Document:

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Exhibit 10.2

                               [uWink Letterhead]

October 25, 2006
Bradley Rotter
850 Corbet Avenue
Suite 6
San Francisco, CA 94131

Dear Bradley:

Reference is made to the $100,000, 10% Convertible Note, dated April 19, 2006,
and due October 19, 2006, between uWink, Inc. (the Company) and you. This letter
will confirm our agreement regarding the note as follows:

         1.       Effective as of the date hereof, you hereby agree to convert
                  the $100,000 principal amount and $5,685 in accrued interest
                  outstanding under the note into shares of common stock at a
                  conversion of $1 per share. In accordance with the terms of
                  the note, you will be entitled to an additional 20% of such
                  amount in shares of common stock, such that the total amount
                  to be converted is $126,822. As such, you hereby agree to
                  accept 126,822 shares of common stock of the company (the
                  "Shares"), together with the warrants set forth below, in full
                  and final satisfaction of the company's obligations to you
                  under the note.

         2.       In accordance with the terms of the note and in consideration
                  of your agreement to convert the amount outstanding under the
                  note into the Shares, the Company will also issue to you
                  three-year immediately exercisable warrants to purchase
                  100,000 shares of common stock at an exercise price of $0.345
                  per share.

Best,

/s/ Nolan K. Bushnell
---------------------
Nolan K. Bushnell
Chairman and CEO

Agreed and accepted:

/s/ Bradley Rotter
---------------------
Bradley RotterBilly Martin's Western Wear, LA, Inc

Java Express, Inc.

           

(a Nevada Corporation)

Convertible Note

Java Express, Inc., a Nevada Corporation ("Company") for value received (summarized more specifically in Exhibit I.) hereby promises to pay to Kelly Trimble (the "Holder") or its assignee, the sum of Eleven Thousand Eighty-five  Dollars and Seventy-five Cents. ($11,085.75) US, with no interest in consideration of the conversion right and payable in accordance with the terms and conditions set forth herein.

1)

Payment Terms:  Principal shall be all due and payable on December 31, 2006.

2)

Right to Convert by Holder:  The Holder of this Note shall have the option to convert the entire amount or any portion thereof, of the principal of this Note into shares of common stock of the Company at a conversion price as hereinafter provided in Paragraph 3 below.

3)

Conversion Price:  The principal of the Note shall be converted into common shares of the Company (the "Converted Shares") at a share price equal to the "bid" price of the Company's common stock on the date of the conversion, or in the event the Company has no bid price, the principal of this Note shall be converted into 12,000 shares as an equity position of the Company.

4)

Conversion Date:  The Conversion Date for the Holder of the Note shall be anytime after December 31, 2006 but no later than December 31, 2007 (the Holder’s Conversion Period).

5)

Manner of Exercise of Conversion rights:  In order to exercise the conversion rights of this Note, the Holder must give notice to the Company at anytime during the Holder's Conversion Period of its intention to exercise

its conversion rights.  Absent such a notice to the Company, the Holder's conversion rights shall expire after the expiration of the Holder's Conversion Period.

6)

Prepayment:  The Company shall have the right to prepay all or any part of the principal of this Note without penalty.  However, in the event the Company elects to prepay the Note, the Holder shall have ten (10) days from the receipt of written notice of this prepayment election to exercise its conversion rights as set forth above in Paragraph 2.

7)

Default:  In the event the Company fails to pay the principal of this Note when due, the Holder shall have the option, after providing thirty (30) days written notice to the Company, to (1) declare the unpaid principal balance all due and payable or (2) exercise their conversion rights for all of the unpaid principal as set forth above in Paragraph 2.

8)

Company to Reserve Shares:   The Company shall at all times during the term of this Note reserve and keep available out of its authorized but unissued shares, such amount of its duly authorized shares of common stock as shall be necessary to effect the conversion of this Note. 

9)

Notices:  All notices given pursuant to this Note must be in writing and may be given by (1) personal delivery, or (2) registered or certified mail, return receipt requested, or (3) via facsimile transmission.

10) Arbitration:  The parties hereby submit all controversies, claims and matters of difference arising out of the Note to arbitration in Utah.  This submission and agreement to arbitrate shall be specifically enforceable. 

IN WITNESS WHEREOF, the Company has caused this Note to be executed by its duly authorized officer this 6th day of October, 2006.

Java Express, Inc.

By: /s/ Howard Abrams

      President

10-06-06Exhibit 4.13

CREDIT AGREEMENT

among

THE HERTZ CORPORATION, and

PUERTO RICANCARS, INC.,

as Borrowers

 

THE SEVERAL LENDERS

FROM TIME TO TIME PARTIES HERETO,

GELCO CORPORATION dba GE FLEET SERVICES,

as Administrative Agent, Domestic Collateral Agent and PRUSVI Collateral Agent,

Dated as of September 29, 2006

GE CAPITAL MARKETS GROUP, INC.,

as Lead Arranger and Bookrunning Manager

 

 

 

Table of Contents

	
   

  	
  Page

  
	
  SECTION 1. DEFINITIONS

   

  	
  3

  
	
  1.1 Defined Terms

  	
  3

  
	
  1.2 Other Definitional Provisions

  	
  64

  
	
   

  SECTION 2. AMOUNT AND TERMS OF COMMITMENTS

  	
  65

  
	
   

  2.1 Commitments

  	
  65

  
	
  2.2 Procedure for Revolving Credit Borrowing

  	
  70

  
	
  2.3 Termination or Reduction of Revolving Facility
  Commitments

  	
  72

  
	
  2.4 Reserved

  	
  72

  
	
  2.5 Reserved

  	
  72

  
	
  2.6 Reserved

  	
  72

  
	
  2.7 Reserved

  	
  72

  
	
  2.8 Repayment of Loans

  	
  72

  
	
   

  SECTION 3. RESERVED

  	
  74

  
	
   

  SECTION 4. GENERAL PROVISIONS APPLICABLE TO LOANS

  	
  74

  
	
   

  4.1 Interest Rates and Payment Dates

  	
  74

  
	
  4.2 Conversion and Continuation Options

  	
  76

  
	
  4.3 Minimum Amounts of Sets

  	
  78

  
	
  4.4 Optional and Mandatory Prepayments

  	
  78

  
	
  4.5 Commitment Fees; Administrative Agent’s Fee;
  Other Fees

  	
  81

  
	
  4.6 Computation of Interest and Fees

  	
  82

  
	
  4.7 Inability to Determine Interest Rate

  	
  83

  
	
  4.8 Pro Rata Treatment and Payments

  	
  85

  
	
  4.9 Illegality

  	
  91

  
	
  4.10 Requirements of Law

  	
  92

  
	
  4.11 Taxes

  	
  96

  
	
  4.12 Indemnity

  	
  106

  
	
  4.13 Certain Rules Relating to the Payment of
  Additional Amounts

  	
  108

  
	
  4.14
  Controls on Prepayment if Aggregate Lender Exposure Exceeds Aggregate
  Revolving Facility Commitments

  	
  112

  
	
  4.15 Reserved

  	
  112

  
	
  4.16 Cash Management System

  	
  112

  
	
   

  SECTION 5. REPRESENTATIONS AND WARRANTIES

  	
  114

  
	
   

  5.1 Financial Condition

  	
  114

  
	
  5.2 No Change; Solvent

  	
  117

  
	
  5.3 Corporate Existence; Compliance with Law

  	
  117

  
	
  5.4 Corporate Power; Authorization; Enforceable
  Obligations

  	
  118

  
	
  5.5 No Legal Bar

  	
  120

  

 

 

i

 

	
  5.6 No Material Litigation

  	
  120

  
	
  5.7 No Default

  	
  121

  
	
  5.8 Ownership of Property; Liens

  	
  121

  
	
  5.9 Intellectual Property

  	
  121

  
	
  5.10 No Burdensome Restrictions

  	
  122

  
	
  5.11 Taxes

  	
  122

  
	
  5.12 Federal Regulations

  	
  123

  
	
  5.13 ERISA

  	
  123

  
	
  5.14 Collateral

  	
  125

  
	
  5.15 Investment Company Act; Other Regulations

  	
  127

  
	
  5.16 Subsidiaries

  	
  128

  
	
  5.17 Purpose of Loans

  	
  128

  
	
  5.18 Environmental Matters

  	
  128

  
	
  5.19 No Material Misstatements

  	
  130

  
	
  5.20 Reserved

  	
  131

  
	
  5.21 Reserved

  	
  131

  
	
  5.22 Senior Indebtedness

  	
  131

  
	
  5.23 Labor Matters

  	
  131

  
	
  5.24 Reserved

  	
  132

  
	
  5.25 Insurance

  	
  132

  
	
  5.26 Eligible Accounts

  	
  132

  
	
  5.27 Eligible Vehicles

  	
  132

  
	
  5.28 Anti-Terrorism

  	
  133

  
	
   

  	
   

  
	
  SECTION 6. CONDITIONS PRECEDENT

  	
  133

  
	
   

  	
   

  
	
  6.1 Conditions to Initial Extension of Credit

  	
  133

  
	
  6.2 Conditions to Each Other Extension of Credit

  	
  142

  
	
   

  	
   

  
	
  SECTION 7. AFFIRMATIVE COVENANTS

  	
  143

  
	
   

  	
   

  
	
  7.1 Financial Statements

  	
  144

  
	
  7.2 Certificates; Other Information

  	
  148

  
	
  7.3 Payment of Obligations

  	
  151

  
	
  7.4 Conduct of Business and Maintenance of
  Existence

  	
  151

  
	
  7.5 Maintenance of Property, Insurance

  	
  152

  
	
  7.6 Inspection of Property; Books and Records;
  Discussions

  	
  153

  
	
  7.7 Notices

  	
  154

  
	
  7.8 Environmental Laws

  	
  158

  
	
  7.9 Reserved

  	
  160

  
	
  7.10 Reserved

  	
  160

  
	
  7.11 Reserved

  	
  160

  
	
  7.12 Reserved

  	
  160

  
	
  7.13 Post-Closing Security Perfection

  	
  160

  
	
  7.14 Existing ABL Facility Advance Rate Event

  	
  162

  
	
   

  	
   

  

 

 

ii

 

	
  SECTION 8. NEGATIVE COVENANTS

  	
  162

  
	
   

  	
   

  
	
  8.1 Limitation on Liens

  	
  162

  
	
  8.2 Limitation on Fundamental Changes

  	
  165

  
	
  8.3 Limitation on Sale of Assets

  	
  167

  
	
  8.4 Reserved.

  	
  168

  
	
  8.5 Limitation on Negative Pledge Clauses

  	
  168

  
	
  8.6 Limitation on Lines of Business

  	
  168

  
	
  8.7 Negative Pledge

  	
  169

  
	
   

  	
   

  
	
  SECTION 9. EVENTS OF DEFAULT

  	
  169

  
	
   

  	
   

  
	
  SECTION 10. THE AGENTS AND THE OTHER REPRESENTATIVES

  	
  178

  
	
   

  	
   

  
	
  10.1 Appointment

  	
  178

  
	
  10.2 Delegation of Duties

  	
  179

  
	
  10.3 Exculpatory Provisions

  	
  179

  
	
  10.4 Reliance by Agents

  	
  181

  
	
  10.5 Notice of Default

  	
  182

  
	
  10.6 Acknowledgements and Representations by
  Lenders

  	
  183

  
	
  10.7 Indemnification

  	
  184

  
	
  10.8 Agents and Other Representatives in Their
  Individual Capacity

  	
  186

  
	
  10.9 Collateral Matters

  	
  186

  
	
  10.10 Successor Agent.

  	
  188

  
	
  10.11 Other Representatives

  	
  190

  
	
  10.12 Reserved.

  	
  190

  
	
  10.13 Withholding Tax

  	
  190

  
	
   

  	
   

  
	
  SECTION 11. MISCELLANEOUS

  	
  191

  
	
   

  	
   

  
	
  11.1 Amendments and Waivers

  	
  191

  
	
  11.2 Notices

  	
  196

  
	
  11.3 No Waiver; Cumulative Remedies

  	
  199

  
	
  11.4 Survival of Representations and Warranties

  	
  200

  
	
  11.5 Payment of Expenses and Taxes

  	
  200

  
	
  11.6 Successors and Assigns; Participations and
  Assignments

  	
  203

  
	
  11.7 Adjustments; Set-off; Calculations;
  Computations

  	
  214

  
	
  11.8 Judgment

  	
  216

  
	
  11.9 Counterparts

  	
  217

  
	
  11.10 Severability

  	
  218

  
	
  11.11 Integration

  	
  218

  
	
  11.12 Governing Law

  	
  218

  
	
  11.13 Submission To Jurisdiction; Waivers

  	
  219

  
	
  11.14 Acknowledgements

  	
  220

  
	
  11.15 Waiver Of Jury Trial

  	
  221

  
	
  11.16 Confidentiality

  	
  221

  
	
  11.17 USA Patriot Act Notice

  	
  223

  
	
  11.18 Reserved

  	
  223

  
	
  11.19 Several Liability, Postponement of
  Subrogation

  	
  223

  

 

iii

 

SCHEDULES

	
  A

  	
   

  	
  Commitments and Addresses

  
	
  B

  	
   

  	
  Fiscal Periods

  
	
  5.2

  	
   

  	
  Material Adverse Effect
  Disclosure and Distributions

  
	
  5.4

  	
   

  	
  Consents Required

  
	
  5.6

  	
   

  	
  Litigation

  
	
  5.9

  	
   

  	
  Intellectual Property
  Claims

  
	
  5.16

  	
   

  	
  Subsidiaries

  
	
  5.18

  	
   

  	
  Environmental Matters

  
	
  5.25

  	
   

  	
  Insurance

  
	
  6.1(i)

  	
   

  	
  Lien Searches

  
	
  6.1(j)

  	
   

  	
  Local and Foreign Counsel

  

 

 

iv

 

EXHIBITS

	
  A-1

  	
   

  	
  Form
  of Revolving Credit Note

  
	
  B-1

  	
   

  	
  Domestic
  Guarantee and Collateral Agreement

  
	
  B-2

  	
   

  	
  PRUSVI
  Guarantee and Collateral Agreement

  
	
  C

  	
   

  	
  Cash
  Management Systems

  
	
  D-1

  	
   

  	
  Opinion
  of Debevoise & Plimpton LLP, Special New York Counsel to the Loan Parties

  
	
  D-2

  	
   

  	
  Opinion
  of Harold Rolfe, General Counsel to the Parent Borrower

  
	
  D-3

  	
   

  	
  Opinion
  of Tom Bolt & Associates, P.C., Special United States Virgin Islands
  Counsel to Certain of the Loan Parties

  
	
  D-4

  	
   

  	
  Opinion
  of Adsuar Muñiz Goyco & Besosa, P.S.C., Special Puerto Rico Counsel to
  Certain of the Loan Parties

  
	
  E

  	
   

  	
  Form
  of U.S. Tax Compliance Certificate

  
	
  F

  	
   

  	
  Form
  of Assignment and Acceptance

  
	
  G

  	
   

  	
  Reserved

  
	
  H

  	
   

  	
  Form
  of Borrowing Certificate

  
	
  I

  	
   

  	
  Form
  of Closing Certificate

  
	
  J

  	
   

  	
  Form
  of Borrowing Base Certificate

  

 

 

v

 

CREDIT AGREEMENT,
dated as of September 29, 2006, among THE HERTZ CORPORATION, a Delaware
corporation (together with its successors and assigns the “Parent Borrower”),
PUERTO RICANCARS, INC., a Puerto Rican corporation (“Puerto Ricancars”) (Puerto
Ricancars together with the Parent Borrower, being collectively referred to
herein as the “Borrowers” and each being individually referred to as a “Borrower”),
the several banks and other financial institutions from time to time parties to
this Agreement (as further defined in Section 1.1, the “Lenders”), GELCO
CORPORATION d.b.a. GE Fleet Services (“GE Fleet Services”), as administrative
agent, collateral agent for Collateral owned by the Parent Borrower for the Lenders
hereunder and collateral agent for Collateral owned by Puerto Ricancars for the
Lenders hereunder (in such capacities, respectively, the “Administrative
Agent”, the “Domestic Collateral Agent” and the “PRUSVI
Collateral Agent”).

The parties hereto
hereby agree as follows:

W I T N E S S E T H:

WHEREAS, Hertz
Global Holdings, Inc., a Delaware corporation (“Holdings”), and its
Wholly Owned Subsidiaries (such term and each other capitalized term used in
these recitals and not otherwise previously defined, as hereinafter defined),
including CCMG Corporation, a Delaware corporation (together with its
successors and assigns “CCMGC”), are each companies organized by
Clayton, Dubilier & Rice, Inc. (“CD&R”), TC Group L.L.C. (which
operates under the trade name The Carlyle Group) (“Carlyle”), Merrill
Lynch Global Private Equity (“MLGPE” and, collectively with CD&R and
Carlyle, the “Sponsors”) or any of their respective Affiliates;

WHEREAS, Holdings
has, through one or more of its Wholly-Owned Subsidiaries, acquired (the “Acquisition”)
all of the issued and outstanding capital stock of the Parent Borrower,
pursuant to the Stock Purchase Agreement, dated as of September 12, 2005 (the “Acquisition
Agreement”), among Holdings, Ford Holdings LLC (the “Seller”) and Ford
Motor Company;

WHEREAS, the
Parent Borrower has obtained a senior secured term loan facility (the “Senior
Term Facility”), under which the Parent Borrower has obtained (a) senior
secured term loans (as further defined in subsection 1.1, the “Senior Term
Loans”) in an amount of up to $2,000,000,000 and (b) a pre-funded synthetic
letter of credit facility in an aggregate amount of $250,000,000;

WHEREAS, the
Parent Borrower, HERC and the other borrowers named therein have obtained a
senior secured ABL revolving loan facility in an amount of up to $1,600,000,000
(as further defined in subsection 1.1, the “Existing ABL Facility”).

WHEREAS, in order
to (i) acquire, finance or refinance Eligible Vehicles (as herein defined),
(ii) repay debt owing by the Parent Borrower and intercompany debt owing by
Puerto Ricancars to Parent Borrower and (iii) finance the working capital and
other business requirements and other general corporate purposes of the Parent
Borrower and Puerto Ricancars and their respective Subsidiaries, the Parent
Borrower and Puerto Ricancars have requested that the Lenders make the Loans
provided for herein;

 

1

 

NOW, THEREFORE, in
consideration of the premises and the mutual agreements contained herein, the
parties hereto agree as follows:

SECTION 1.  DEFINITIONS.

1.1           Defined
Terms.  As used in this Agreement,
the following terms shall have the following meanings:

“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 1/2 of 1%.  For purposes hereof:  ”Prime
Rate” shall mean a rate per annum equal to the rate last quoted by The Wall
Street Journal as the “base rate on corporate loans posted by at least 75% of
the nation’s largest banks” in the United States or, if The Wall Street Journal
ceases to quote such rate, the highest per annum interest rate published by the
Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest
Rates) as the “bank prime loan” rate or, if such rate is no longer quoted
therein, any similar rate quoted therein (as determined by the Administrative
Agent) or any similar release by the Board (as determined by the Administrative
Agent).  “Federal Funds Effective Rate”
shall mean, 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 of New York, or, if such rate is not so published for any day
which is a Business Day, the average of the quotations for the day of such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it. 
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.

“Acceleration”:  as
defined in subsection 9(e).

“Account Debtor”:  each
Person who is obligated on an Account, chattel paper or a General Intangible.

“Accounts”:  as
defined in the UCC; and, with respect to any Person, all such Accounts of such
Person, whether now existing or existing in the future, including (a) all
accounts receivable of such Person (whether or not specifically listed on
schedules furnished to the Administrative Agent), including all accounts
created by or arising from all of such Person’s sales of goods or rendition of
services made under any of its trade names, or through any of its divisions, (b)
all unpaid rights of such Person (including rescission, replevin, reclamation
and stopping in transit) relating to the foregoing or arising therefrom, (c)
all rights to any goods represented by any of the foregoing, including returned
or repossessed goods, (d) all reserves and credit balances held by such Person
with respect to any such accounts receivable of any Obligors, (e) all letters
of credit, guarantees or collateral for any of the foregoing and (f) all
insurance policies or rights relating to any of the foregoing.

 

2

 

“Acquisition”:  as
defined in the Recitals hereto.

“Acquisition
Agreement”:  as defined in the Recitals hereto.

“Administrative
Agent”:  as defined in the Preamble hereto and shall include any
successor to the Administrative Agent appointed pursuant to subsection 10.10.

“Affected
Eurocurrency Rate”:  as defined in subsection 4.7.

“Affected Loans”:  as
defined in subsection 4.9.

“Affiliate”:  as
to any Person, any other Person (other than a Subsidiary) which, directly or
indirectly, is in control of, is controlled by, or is under common control
with, such Person.  For purposes of this
definition, “control” of a Person means the power, directly or indirectly,
either to (a) vote 20% or more of the securities having ordinary voting power
for the election of directors of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.

“Agents”:  the
collective reference to the Administrative Agent, the Domestic Collateral Agent
and the PRUSVI Collateral Agent.

“Aggregate
Lender Exposure”:  the aggregate principal amount of all
Revolving Credit Loans then outstanding.

“Agreement”:  this
Credit Agreement, as amended, supplemented, waived or otherwise modified, from
time to time.

“Applicable
Margin”:  the rate per annum determined as
follows:  (A) with respect to ABR Loans, 0.25% per annum and,
(B) with respect to Eurocurrency Loans, 1.25% per annum.

“Approved Fund”:  as
defined in subsection 11.6(b).

“Arranger”  GE Capital Markets Group, Inc., as Lead
Arranger under this Agreement.

“Assignee”:  as
defined in subsection 11.6(b).

“Assignment and
Acceptance”:  an Assignment and Acceptance, substantially in the
form of Exhibit F.

“Availability
Reserves”:  without duplication of any other reserves or items
that are otherwise addressed or excluded through eligibility criteria, such
reserves, subject to subsection 2.1(c), as the Administrative Agent, in its
Permitted Discretion, determines as being appropriate to reflect any
impediments to the realization upon the Facility Assets consisting of Eligible
Accounts or Eligible Vehicles included in the Domestic Borrowing Base or PRUSVI
Borrowing Base (including claims that the Administrative Agent so determines
will need to be satisfied in connection with the realization upon such Facility
Assets).

 

3

 

“Benefited
Lender”:  as defined in subsection 11.7(a).

“Board”:  the
Board of Governors of the Federal Reserve System.

“Borrowers”:  as
defined in the Preamble hereto.

“Borrowing”:  the
borrowing of one Type of Loan by either the Parent Borrower or Puerto
Ricancars, from all the Lenders having Revolving Facility Commitments on a
given date (or resulting from a conversion or conversions on such date) having
in the case of Eurocurrency Loans the same Interest Period.

“Borrowing Base
Certificate”:  as defined in subsection 7.2(f).

“Borrowing Date”:  any
Business Day specified in a notice pursuant to subsection 2.2 as a date on
which the Parent Borrower, Puerto Ricancars or any other Borrower requests the
Lenders to make Loans hereunder.

“Brazilian
Indebtedness”:  Indebtedness of Car
Renal System do Brasil Locacao de Veiculos Ltda or any successor in interest thereto
and/or any other Subsidiary engaged in, or Special Purpose Entity otherwise
supporting or relating to, the business of leasing or renting vehicles in
Brazil.

“Business Day”:  a
day other than a Saturday, Sunday or other day on which commercial banks in New
York, New York are authorized or required by law to close, except that, when
used in connection with a Eurocurrency Loan, “Business Day” shall mean, in the
case of any Eurocurrency Loan in Dollars, any Business Day on which dealings in
Dollars between banks may be carried on in London, England and New York, New
York.

“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 or
options to purchase any of the foregoing.

“Carlyle”:  as defined in the Recitals hereto.

“Cash
Equivalents”:  (a) securities issued or fully guaranteed or
insured by the United States government or any agency or instrumentality
thereof, (b) time deposits, certificates of deposit or bankers’
acceptances of (i) any Lender or Affiliate thereof or (ii) any commercial bank
having capital and surplus in excess of $500,000,000 and the commercial paper
of the holding company of which is rated at least A-2 or the equivalent thereof
by Standard & Poor’s Ratings Group (a division of The McGraw Hill Companies
Inc.) or any successor rating agency (“S&P”) or at least P-2 or the
equivalent thereof by Moody’s Investors Service, Inc. or any successor rating
agency (“Moody’s”) (or if at such time neither is issuing ratings, then
a comparable rating of such other nationally recognized rating agency as shall
be approved by the Administrative Agent in its reasonable judgment), (c)
commercial paper rated at least A-2 or the equivalent thereof by S&P or at
least P-2 or the equivalent thereof by Moody’s (or if at such time neither is
issuing ratings, then a comparable rating of such other nationally recognized
rating agency as shall be approved by the Administrative Agent in its
reasonable judgment),

 

4

 

(d) investments in money market funds complying with the risk
limiting conditions of Rule 2a-7 or any successor rule of the Securities and
Exchange Commission under the Investment Company Act, and (e) investments
similar to any of the foregoing denominated in foreign currencies approved by
the board of directors of the Parent Borrower, in each case provided in clauses
(a), (b), (c) and (e) above only, maturing within twelve months after the date
of acquisition.

“Cash
Management System”: as defined in Section 4.16.

“CCMGC”: as
defined in the Recitals hereto.

“CD&R”:  as
defined in the Recitals hereto.

“CD&R
Investors”:  the collective reference to (i) Clayton, Dubilier
& Rice Fund VII, L.P., a Cayman Islands exempted limited partnership, or
any successor thereto, (ii) CD&R CCMG Co-Investor L.P., a Cayman Islands
exempted limited partnership, or any successor thereto, (iii) CD&R Parallel
Fund VII, L.P., a Cayman Islands exempted limited partnership, or any successor
thereto, (iv) any Affiliate of any thereof, and (v) any successor in interest
to any thereof.

“Change of
Control”:  the occurrence of any of the following
events:  (a) at any time prior to the initial registered public
offering of CCMGC’s or any Parent Entity’s Voting Stock the Permitted Holders
shall in the aggregate be the “beneficial owner” (as defined in Rules 13d-3 and
13d-5 under the Exchange Act) of (x) so long as CCMGC is a Subsidiary of any
Parent Entity, shares of Voting Stock having less than 51% of the total voting
power of all outstanding shares of such Parent Entity (other than a Parent
Entity that is a Subsidiary of another Parent Entity) and (y) if CCMGC is not a
Subsidiary of any Parent Entity, shares of Voting Stock having less than 51% of
the total voting power of all outstanding shares of CCMGC, (b) on and after the
date of the initial registered public offering of CCMGC’s or any Parent
Entity’s Voting Stock, (i) (x) the Permitted Holders shall in the aggregate be
the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act) of (A) so long as CCMGC is a Subsidiary of any Parent Entity, shares of
Voting Stock having less than 35% of the total voting power of all outstanding
shares of such Parent Entity (other than a Parent Entity that is a Subsidiary
of another Parent Entity) and (B) if CCMGC is not a Subsidiary of any Parent
Entity, shares of Voting Stock having less than 35% of the total voting power
of all outstanding shares of CCMGC and (y) any “person” or “group” (as such
terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than one
or more Permitted Holders, shall be the “beneficial owner” of (A) so long as
CCMGC is a Subsidiary of any Parent Entity, shares of Voting Stock having more
than 35% of the total voting power of all outstanding shares of such Parent
Entity (other than a Parent Entity that is a Subsidiary of another Parent
Entity) and (B) if CCMGC is not a Subsidiary of any Parent Entity, shares of
Voting Stock having more than 35% of the total voting power of all outstanding
shares of CCMGC or (ii) the Continuing Directors shall cease to constitute
a majority of the members of the board of directors of CCMGC; (c) CCMGC shall
cease to own, directly or indirectly, 100% of the Capital Stock of the Parent
Borrower (or any successor to the Parent Borrower permitted pursuant to
subsection 8.2); or (d) a “Change of Control” as defined in any Financing
Documentation; as used in this 

 

5

 

paragraph “Voting Stock” shall mean shares of Capital Stock
entitled to vote generally in the election of directors.

“Chief
Executive Office”:  with respect to any Person, the location from
which such Person manages the main part of its business operations or other
affairs.

“Closing Date”:  the
date on which all the conditions precedent set forth in subsection 6.1 shall be
satisfied or waived.

“Code”:  the
Internal Revenue Code of 1986, as amended from time to time.

“Collateral”:  all
assets of the Loan Parties, now owned or hereafter acquired, upon which a Lien
is purported or intended to be created by any Security Document.

“Commitment Fee
Rate”:  0.375% per annum.

“Commitment
Period”:  the period from and including the Closing Date to but
not including the Termination Date, or such earlier date as the Revolving
Facility Commitments shall terminate as provided herein.

“Commonly
Controlled Entity”:  an entity, whether or not incorporated,
which is under common control with the Parent Borrower within the meaning of
Section 4001 of ERISA or is part of a group which includes the Parent Borrower
and which is treated as a single employer under Section 414(b) or (c) of the
Code or, solely for purposes of Section 302 of ERISA and Section 412 of the
Code, is treated as a single employer under Sections 414(m) and (o) of the
Code.

“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 delivered to the Administrative
Agent (a copy of which shall be provided by the Administrative Agent to the
Parent Borrower on request); provided that the designation by any Lender
of a Conduit Lender shall not relieve the designating Lender of any of its
obligations under this Agreement, including its obligation to fund a Loan 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 any provision of this Agreement, including without limitation
subsection 4.10, 4.11, 4.12 or 11.5, than the designating Lender would have
been entitled to receive in respect of the extensions of credit made by such
Conduit Lender if such designating Lender had not designated such Conduit
Lender hereunder, (b) be deemed to have any Revolving Facility Commitment or
(c) be designated if such designation would otherwise increase the costs of the
Revolving Facility to any Borrower.

“Continuing
Directors”:  the directors of CCMGC on the Closing Date, and each
other director if, in each case, such other director’s nomination for election
to the board of directors of CCMGC is recommended by at least a majority of the
then Continuing Directors or the election of such other director is approved by
one or more Permitted Holders.

 

6

 

“Contractual
Obligation”:  as to any Person, any provision of any material
security issued by such Person or of any material agreement, instrument or
other undertaking to which such Person is a party or by which it or any of its
property is bound.

“Default”:  any
of the events specified in Section 9, whether or not any requirement for the
giving of notice (other than, in the case of subsection 9(e), a Default
Notice), the lapse of time, or both, or any other condition specified in
Section 9, has been satisfied.

“Default Notice”:  as
defined in subsection 9(e).

“Defaulting
Lender”:  as defined in subsection 4.8(c).

“Deposit
Account”:  any deposit account (as such term is defined in
Article 9 of the UCC).

“Disposition”:  any
sale, issuance, conveyance, transfer, lease or other disposition (including
through a Sale and Leaseback Transaction).

“Dollars”
and “$”:  dollars in lawful currency of the United States of
America.

“Dollar Senior
Notes”: 8.875% Senior Notes due 2014 of the Parent Borrower, as the same
may be exchanged for substantially similar unsecured senior notes or unsecured
senior subordinated notes, as applicable, that have been registered under the
Securities Act, and as the same or such substantially similar notes may be
amended, supplemented, waived or otherwise modified from time to time.

“Domestic
Borrowing Base”:  as of any date of determination, the result of:

(a)           85%
of the net book value of Eligible Domestic Accounts, plus

(b)           90%
of the net book value of Eligible Domestic Program Vehicles, plus

(c)           85%
of the net book value of the Eligible Domestic Risk Vehicles provided, that,
not more than 10% in the aggregate  of the Domestic Borrowing Base shall consist
of former Eligible Domestic Program Vehicles that are no longer in compliance
with the applicable repurchase program eligibility criteria, plus

(d)           the
sum of all amounts on deposit with, or manufacturer receivables owing to, any
“qualified intermediary” under any LKE Program and derived from or otherwise
attributable to the transfer of Eligible Domestic Program Vehicles and Eligible
Domestic Risk Vehicles, plus

(e)           the sum of all amounts on deposit in
a Deposit Account over which the Domestic Collateral Agent has a perfected
first priority security interest and has control, minus

(f)            the amount of all Availability
Reserves related to the Domestic Borrowing Base.

 

7

 

Notwithstanding
the foregoing, the portion of the Domestic Borrowing Base consisting of
Eligible Domestic Vehicles registered or submitted for registration in the
State of Kansas shall not be more than the lesser of (i) $15,000,000 and (ii)
10.0% of the Total Borrowing Base.

For purposes of
calculating the Domestic Borrowing Base: 
(i) the net book value of Eligible Domestic Program Vehicles will be
amortized to reflect the values for such Vehicles as determined under the
applicable Manufacturer Repurchase Program Agreement, (ii) the net book value
of Eligible Domestic Risk Vehicles will be amortized to reflect the values for
such Vehicles pursuant to the normal depreciation in the ordinary course of
business as determined by the Parent Borrower; (iii) the book value of Eligible
Domestic Vehicles will be calculated on a pro forma basis giving effect to the
acquisition of Vehicles to be registered in the States of Hawaii or Kansas and
for which the necessary registration documentation (including a certificate of
title) has been submitted to the applicable Governmental Authority; and (iv)
all calculations will be made in accordance with GAAP).

Upon the
occurrence of and during the continuance of an Existing ABL Facility Advance
Rate Event, with respect to (i) Eligible Domestic Program Vehicles and Eligible
Domestic Risk Vehicles of a manufacturer that is not then in bankruptcy or that
is then in bankruptcy and which has at such time, as part of its bankruptcy
proceeding, affirmed its obligations under its buyback program with the Parent
Borrower and resumed making payments to the Parent Borrower under its buyback
program, the advance rate for Eligible Domestic Program Vehicles shall be
reduced to 85% and the advance rate for Eligible Domestic Risk Vehicles shall
be reduced to 80%; and (ii) Eligible Domestic Program Vehicles of a
manufacturer that is then in bankruptcy and which has not at such time, as part
of its bankruptcy proceeding, affirmed its obligations under its buyback
program with the Parent Borrower and resumed making payments to the Parent
Borrower under its buyback program, the advance rates for Eligible Domestic
Program Vehicles shall each be reduced to 77%.

Any such
reductions of advance rates shall take effect on the date that is seven (7)
days after the Administrative Agent shall notify Parent Borrower of such
reduction unless prior to such date Parent Borrower shall have remedied the
relevant Existing ABL Facility Advance Rate Event (including, but not limited
to, by way of receipt of any Specified Equity Contribution, as that term is
defined in the Existing ABL Facility) and shall apply to all applicable
Vehicles then included in the Domestic Borrowing Base.

“Domestic
Collateral Agent”:  as defined in the Recitals hereto and shall
include any successor thereto, which has been approved by the Administrative
Agent.

“Domestic
Guarantee and Collateral Agreement”:  the Domestic Guarantee and
Collateral Agreement delivered to the Domestic Collateral Agent as of the date
hereof, substantially in the form of Exhibit B-1, as the same may be amended,
supplemented, waived or otherwise modified from time to time.

“Domestic
Secured Parties”:  the “Secured Parties” as defined in the
Domestic Guarantee and Collateral Agreement.

 

8

 

“Domestic
Security Documents”:  the collective reference to the Domestic
Guarantee and Collateral Agreement and all other similar security documents
hereafter delivered to the Domestic Collateral Agent or the PRUSVI Collateral
Agent, as applicable, granting or perfecting a Lien on any asset or assets of
any Person to secure the obligations and liabilities of the Loan Parties
hereunder and/or under any of the other Loan Documents or to secure any
guarantee of any such obligations and liabilities, including any security
documents executed and delivered or caused to be delivered to the Domestic
Collateral Agent or the PRUSVI Collateral Agent, as applicable, pursuant to
subsection 7.13, in each case, as amended, supplemented, waived or otherwise
modified from time to time.

“Domestic
Subsidiaries Guaranty”:  the guaranty of the obligations of the
Borrowers under the Loan Documents provided pursuant to the Domestic Guarantee
and Collateral Agreement.

“Domestic
Subsidiary”:  any Subsidiary of the Parent Borrower which is not
a Foreign Subsidiary.

“Domestic
Subsidiary Guarantor”:  each Domestic Subsidiary (other than any
Special Purpose Subsidiary, any Subsidiary of a Foreign Subsidiary, Navigation
Solutions LLC and Hertz Vehicle Sales Corporation) of the Parent Borrower which
executes and delivers a Domestic Subsidiary Guaranty, in each case, unless and
until such time as the respective Domestic Subsidiary Guarantor ceases to
constitute a Domestic Subsidiary of the Parent Borrower or is released from all
of its obligations under the Domestic Subsidiaries Guaranty in accordance with
terms and provisions thereof.

“Eligible
Accounts”:  those Accounts created by a Borrower in the ordinary
course of its business, due pursuant to a Manufacturer Repurchase Program
Agreement arising out of a sale of Eligible Program Vehicles, that comply in
all material respects with each of the representations and warranties
respecting Eligible Accounts made in the Loan Documents, and that are not
excluded as ineligible by virtue of one or more of the excluding criteria set
forth below.  In determining the amount
to be included, Eligible Accounts shall be calculated net of customer deposits
and unapplied cash.  Eligible Accounts
shall not include the following:

(a)           Accounts
that the Account Debtor has failed to pay within 60 days of original invoice
date, provided that, notwithstanding the foregoing, up to $10,000,000 of
Accounts on extended terms shall not be deemed ineligible under this clause so
long as the Account Debtor has not failed to pay within 90 days of the original
invoice date,

(b)           Accounts
owed by an Account Debtor and Accounts owed by Affiliates of such Account
Debtor if 50% or more of the total amount of all Accounts owed by that Account
Debtor and its Affiliates are deemed ineligible under clause (a) above,

(c)           Without
duplication, the amount of any credit balances greater than 60 days past their
invoice date with respect to any Account,

(d)            Accounts
with respect to which the Account Debtor is a creditor of any Loan Party or any
Subsidiary of a Loan Party, has or has asserted a right of setoff, or has

 

9

 

disputed its obligation to pay all or any portion of the
Account, to the extent of such claim, right of setoff, or dispute,

(e)           Accounts
with respect to which the Account Debtor is insolvent, is subject to a
proceeding related thereto, has gone out of business, or as to which a Loan
Party has received notice of an imminent proceeding related to such Account
Debtor being or alleged to be insolvent or which proceeding is reasonably
likely to result in a material impairment of the financial condition of such
Account Debtor, provided, that such accounts shall be Eligible Accounts if (i)
such Account Debtor has assumed its applicable Manufacturer Repurchase Program
Agreement and (ii) such Account Debtor has affirmed its obligations to pay such
receivables in accordance with their terms, and

(f)            Accounts
that consist of incentive payments.

“Eligible
Domestic Accounts”:  the Eligible Accounts owned by the Parent
Borrower.

“Eligible
Domestic Program Vehicles”: Eligible Program Vehicles owned by the Parent
Borrower.

“Eligible
Domestic Risk Vehicles”:  Eligible
Risk Vehicles owned by the Parent Borrower.

“Eligible
Domestic Vehicles”:  Eligible
Vehicles owned by the Parent Borrower.

“Eligible
Program Vehicles”:  Rental Car
Vehicles registered or submitted for registration in the States of Hawaii or
Kansas, the Commonwealth of Puerto Rico or Saint Thomas, United States Virgin
Islands that are eligible under a Manufacturer Repurchase Program Agreement; provided,
however, that, with respect to any manufacturer other than General
Motors and Ford (for each of which a collateral assignment of the applicable
Manufacturer Repurchase Program Agreements shall be obtained on or prior to the
Closing Date), if a collateral assignment of the Manufacturer Repurchase
Program Agreement with such manufacturer, as each such agreement relates to the
Facility Assets, is not executed and delivered by such applicable manufacturer
in form and substance reasonably satisfactory to Administrative Agent within 60
days following the Closing Date, Rental Car Vehicles eligible under a
Manufacturer Repurchase Program Agreement from such manufacturer shall cease to
be Eligible Program Vehicles until such time as such collateral assignment is
executed and delivered (and, for the avoidance of doubt, shall not constitute
or qualify as Eligible Risk Vehicles).

“Eligible
PRUSVI Accounts”:  the Eligible Accounts owned by Puerto
Ricancars.

“Eligible
PRUSVI Program Vehicles”:  Eligible
Program Vehicles owned by Puerto Ricancars.

“Eligible
PRUSVI Risk Vehicles”:  Eligible Risk
Vehicles owned by Puerto Ricancars.

“Eligible
PRUSVI Vehicles”:  Eligible Vehicles
owned by Puerto Ricancars.

 

10

 

“Eligible Risk
Vehicles”:  Rental Car Vehicles
registered or submitted for registration in States of Hawaii or Kansas, the
Commonwealth of Puerto Rico or Saint Thomas, United States Virgin Islands that
are not eligible under a Manufacturer Repurchase Program Agreement; provided,
further, for the avoidance of doubt, that Rental Car Vehicles that are
eligible under a Manufacturer Repurchase Program Agreement, but which do not
constitute or qualify as Eligible Program Vehicles pursuant to the proviso set
forth in the definition of “Eligible Program Vehicles” shall not constitute or
qualify as Eligible Risk Vehicles.

“Eligible
Vehicles”:  collectively, all
Eligible Program Vehicles and Eligible Risk Vehicles reflected in the most
recent Borrowing Base Certificate delivered by Borrowers to the Administrative
Agent, except any Vehicles to which any of the exclusionary criteria set forth
below applies.  Eligible Vehicles shall
not include any Vehicle or Vehicles of any Borrower that:

(a)           is
not owned by such Borrower free and clear of all Liens (other than Permitted
Liens) and rights of any other Person except the Liens in favor of the Domestic
Collateral Agent, the PRUSVI Collateral Agent or the Administrative Agent, on
behalf of itself and Lenders;

(b)           is
not covered by a certificate of title issued by the appropriate state
Governmental Authority; provided, that with respect to Vehicles located
in the Commonwealth of Puerto Rico not covered by a certificate of title issued
by the appropriate state Governmental Authority, such Vehicles shall be
Eligible Vehicles if Puerto Ricancars has other customary evidence of ownership
reasonably satisfactory to the PRUSVI Collateral Agent, including, but not
limited to, a notarized seller’s invoice or a manufacturer’s statement or
origin;

(c)           is
not subject to a first priority lien in favor of the Domestic Collateral Agent
or the PRUSVI Collateral Agent, as applicable, on behalf of itself and Lenders
(other than Vehicles owned on the Closing Date and other than Kansas Vehicles);

(d)           with
respect to Vehicles owned by either Borrower on the Closing Date (other than
Kansas Vehicles), (i) the certificate of title for such Vehicle has not been
submitted for notation of the Lien in favor of the Domestic Collateral Agent or
the PRUSVI Collateral Agent, as applicable, to the applicable Governmental
Authorities in the State of Hawaii, the Commonwealth of Puerto Rico or the U.S.
Virgin Islands or with respect to Vehicles for which certificates of title are
to be, but have not yet been, issued by the appropriate state Governmental
Authority in the Commonwealth of Puerto Rico, Puerto Ricancars has not
submitted for stamping or notation on the respective certificates of title when
issued the security interest of the PRUSVI Collateral Agent or (ii) if the
applicable time period for such Vehicle set forth in Section 7.13 has expired,
the security interest of the Domestic Collateral Agent or the PRUSVI Collateral
Agent, as applicable, on behalf of itself and Lenders, has not been stamped or
otherwise noted on the certificates of title for such Vehicles, in compliance
with the first sentence of Section 7.13;

(e)           does
not comply with any of the representations or warranties pertaining to Vehicles
set forth in the Loan Documents; or

 

11

 

(f)            is
not covered by casualty and liability insurance in compliance with Section 7.5
hereof .

“Environmental
Costs”:  any and all costs or expenses (including attorney’s and
consultant’s fees, investigation and laboratory fees, response costs, court
costs and litigation expenses, fines, penalties, damages, settlement payments,
judgments and awards), of whatever kind or nature, known or unknown, contingent
or otherwise, arising out of, or in any way relating to, any actual or alleged
violation of, noncompliance with or liability under any Environmental
Laws.  Environmental Costs include any
and all of the foregoing, without regard to whether they arise out of or are
related to any past, pending or threatened proceeding of any kind.

“Environmental
Laws”:  any and all U.S. or foreign federal, state, provincial,
territorial, foreign, local or municipal laws, rules, orders, enforceable
guidelines and orders-in-council, regulations, statutes, ordinances, codes,
decrees, and such requirements of any Governmental Authority properly
promulgated and having the force and effect of law or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health (as it relates to exposure
to Materials of Environmental Concern) or the environment, as have been, or now
or at any relevant time hereafter are, in effect.

“Environmental
Permits”:  any and all permits, licenses, registrations,
notifications, exemptions and any other authorization required under any
Environmental Law.

“Equipment”
means (a) any Vehicles and (b) any equipment owned by or leased
to the Parent Borrower or any of its Subsidiaries that is revenue earning
equipment, or is classified as “revenue earning equipment” in the consolidated
financial statements of the Parent Borrower, including any such equipment
consisting of (i) construction,
industrial, commercial and office equipment, (ii) earthmoving, material handling, compaction, aerial and
electrical equipment, (iii) air
compressors, pumps and small tools, and (iv) other
personal property.

“Equity
Investors”:  the collective reference
to (a) the CD&R Investors, the Carlyle Investors and the Merrill Lynch
Investors and (b) any entity that succeeds to all of the rights and obligations
of any of the foregoing by operation of law.

“ERISA”:  the
Employee Retirement Income Security Act of 1974, as amended from time to time.

“Escrow
Agreement”: as defined in Exhibit C hereto.

“Eurocurrency
Base Rate”:  with respect to each day during each Interest Period
pertaining to a Eurocurrency Loan, the rate per annum determined by the
Administrative Agent to be the arithmetic mean (rounded to the nearest 1/100th
of 1%) of the offered rates for deposits in Dollars with a term comparable to
such Interest Period that appears on the Telerate British Bankers Assoc.
Interest Settlement Rates Page (as defined below) at approximately 11:00 A.M.,
London time, on the second full Business Day preceding the first day of such
Interest Period; provided, however, that if there shall at any
time no longer exist a Telerate British Bankers Assoc. Interest Settlement
Rates Page, “Eurocurrency Base Rate” shall mean, with respect to 

 

12

 

each day during each Interest Period pertaining to a Eurocurrency Loan,
the rate per annum equal to the rate at which the Administrative Agent is
offered deposits in Dollars at or about 10:00 A.M., New York City time, two
Business Days prior to the beginning of such Interest Period in the interbank
eurocurrency market where the eurocurrency and foreign currency and exchange
operations in respect of Dollars are then being conducted for delivery on the
first day of such Interest Period for the number of days comprised therein and
in an amount comparable to the amount of its Eurocurrency Loan to be
outstanding during such Interest Period. 
“Telerate British Bankers Assoc. Interest Settlement Rates Page”
shall mean the display designated as Page 3750 on the Telerate System (or such
other page as may replace such page on such service for the purpose of
displaying the rates at which Dollar deposits are offered by leading banks in
the London interbank deposit market).

“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

  	
   

  

 

“Eurocurrency
Reserve Requirements”:  for any day as applied to a Eurocurrency
Loan, the aggregate (without duplication) of the rates (expressed as a decimal
fraction) of reserve requirements in effect on such day (including basic,
supplemental, marginal and emergency reserves under any regulations of the
Board or other Governmental Authority having jurisdiction with respect thereto)
dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D of the
Board) maintained by a member bank of the Federal Reserve System.

“Euro MTN
Facility”:  the Euro Medium-Term
Notes of Hertz Finance Centre plc and/or the Parent Borrower, issued and
outstanding on the date hereof pursuant to the Amended and Restated Fiscal
Agency Agreement, dated as of July 16, 2004, among the Parent Borrower, Hertz
Finance Centre PLC, JPMorgan Chase Bank and J.P. Morgan Bank Luxembourg S.A.,
as amended, modified or supplemented from time to time.

“Euro Senior
Notes”:  7.875% Senior Notes due 2014
of the Parent Borrower, as the same may be exchanged for substantially similar
unsecured senior notes or unsecured senior subordinated notes, as applicable,
that have been registered under the Securities Act, and as the same or such
substantially similar notes may be amended, supplemented, waived or otherwise
modified from time to time.

“Event of
Default”:  any of the events specified in Section 9, provided
that any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.

 

13

 

“Exchange Act”:  the
Securities Exchange Act of 1934, as amended from time to time.

“Excluded
Assets”: as defined in the Domestic Guarantee and Collateral Agreement and
the PRUSVI Guarantee and Collateral Agreement.

“Existing ABL
Facility”: as defined in the recitals hereto, as amended, modified or
supplemented from time to time.

“Existing ABL
Facility Credit Agreement”:  the
Credit Agreement dated as of December 21, 2005 and as amended as of June 30,
2006 among HERC, the Parent Borrower, the Canadian borrowers party thereto,
Deutsche Bank AG, New York Branch, as Administrative Agent and Collateral Agent
and the other agents party thereto, and as further amended, modified or
supplemented from time to time.

“Existing ABL
Facility Documents”:  the “Loan
Documents” defined in the Existing ABL Facility Credit Agreement, as the
same may be amended, supplemented, waived, replaced or otherwise modified from
time to time.

“Existing ABL
Facility Advance Rate Event”:  the
occurrence of either of the following: (i) a breach of any of the
financial covenants set forth in Section 8.1 the Existing ABL Facility Credit
Agreement (as in effect of the date of this Agreement) and the waiver of such
breach by the lenders thereunder or (ii) (A) the amendment,
supplementation or other modification of (a) any such financial
covenant described in clause (i) above, (b) the definition of
“Liquidity Event” set forth in the Existing ABL Facility Credit Agreement (as
in effect on the date of this Agreement) or (c) any component
definition used in either of the foregoing clauses (a) and
(b) (including, without limitation, changes arising from a Refinance of
the Existing ABL Facility Credit Agreement) and (B) such financial
covenant or the definition of a Liquidity Event would be breached or result in
the occurrence of a Liquidity Event, as applicable, if it had not been so
amended, supplemented or otherwise modified.

“Existing
Facilities”:  collectively, the
Senior Term Loans and the Existing ABL Facility, including any Refinance
thereof.

“Extension of
Credit”:  as to any Lender, the making of a Loan by such Lender.

“Facility
Assets”: collectively, the Collateral and the Kansas Vehicles and all
proceeds thereof.

“Fair Market
Value”:  with respect to any asset or property, the fair market
value of such asset or property as determined in good faith by the board of
directors of the Parent Borrower, whose determination will be conclusive.

“Federal Funds
Effective Rate”:  as defined in the definition of the term “ABR”
in this subsection 1.1.

“Financing
Disposition”:  any Disposition, or
incurrence of any Lien on, property or assets by the Parent Borrower or any
Subsidiary thereof to or in favor of any Special Purpose 

 

14

 

Entity, or by any Special Purpose Subsidiary, in each case in
connection with the incurrence by a Special Purpose Entity of Indebtedness, or
obligations to make payments to the obligor on Indebtedness, which may be
secured by a Lien in respect of such property or assets.

“Financing
Documentation”:  the Existing ABL
Facility Credit Agreement, the Senior Term Loans Documents, the New Notes
Indentures, the Special Purpose Financing Documents and the Foreign Fleet
Financing Documents, if any, in each case including any Interest Rate
Protection Agreements related thereto.

“first priority”
means, with respect to any Lien purported to be created in any Collateral
pursuant to any Security Document, that such Lien is the most senior Lien to
which such Collateral is subject (subject to Permitted Liens).

“Fiscal Period”:  means
each fiscal month of the Parent Borrower and its Subsidiaries as described on
Schedule B.

“Fiscal Year”:  any
period of twelve consecutive months ending on December 31 of any calendar year.

“Foreign Fleet
Financing Documents”: any documents pursuant to which any Foreign Fleet
Financings (including the Foreign Fleet Bridge Financing) (as each such term is
defined in the Existing ABL Facility Credit Agreement, as in existence on the
date hereof) are consummated or otherwise governing the terms thereof.

“Foreign
Pension Plan”:  a registered pension plan which is subject to
applicable pension legislation other than ERISA or the Code, which a Subsidiary
sponsors or maintains, or to which it makes or is obligated to make
contributions.

“Foreign Plan”:  each
Foreign Pension Plan, deferred compensation or other retirement or
superannuation plan, fund, program, agreement, commitment or arrangement
whether oral or written, funded or unfunded, sponsored, established, maintained
or contributed to, or required to be contributed to, or with respect to which
any liability is borne, outside the United States of America, by the Parent
Borrower or any of its Subsidiaries, other than any such plan, fund, program,
agreement or arrangement sponsored by a Governmental Authority.

“Foreign
Subsidiary”:  any Subsidiary of the Parent Borrower which is
organized and existing under the laws of any jurisdiction outside of the United
States of America or that is a Foreign Subsidiary Holdco.  For the avoidance of doubt, any Subsidiary of
the Parent Borrower which is organized and existing under the laws of Puerto
Rico shall be a Foreign Subsidiary.

“Foreign
Subsidiary Holdco”:  any Subsidiary of the Parent Borrower, so
long as such Subsidiary has no material assets other than securities of one or
more Foreign Subsidiaries and Indebtedness issued by such Foreign Subsidiaries
(or Subsidiaries thereof), and other assets relating to an ownership interest
in any such securities, Indebtedness or Subsidiaries.  As of the Closing Date, each of Hertz
International Ltd. and CCMG HERC Sub, Inc. are Foreign Subsidiary Holdcos.

 

15

“GAAP”:  
generally accepted accounting principles in the United States of America in
effect from time to time.

“General
Intangibles”:  ”general intangibles” (as such term is defined in
Article 9 of the UCC), including payment intangibles, contract rights, rights
to payment, rights arising under common law, statutes, or regulations, choses
or things in action, goodwill, patents, trade names, trade secrets, trademarks,
servicemarks, copyrights, blueprints, drawings, purchase orders, customer
lists, monies due or recoverable from pension funds, route lists, rights to payment
and other rights under any royalty or licensing agreements, infringement
claims, computer programs, information contained on computer disks or tapes,
software, literature, reports, catalogs, insurance premium rebates, tax
refunds, and tax refund claims, and any and all supporting obligations in
respect thereof, and any other personal property other than Accounts, Deposit
Accounts, goods, Investment Property, and Negotiable Collateral.

“Governmental
Authority”:  any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to
government, including the European Union.

“Guarantee
Obligation”:  as to any Person (the “guaranteeing person”),
any obligation of (a) the guaranteeing person or (b) another Person (including
any bank under any letter of credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counterindemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in
any manner, whether directly or indirectly, including any such obligation of
the guaranteeing person, whether or not contingent, (i) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (A) for the purchase or payment of
any such primary obligation or (B) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (iii) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation or (iv) otherwise to assure or hold harmless the owner of
any such primary obligation against loss in respect thereof; provided, however,
that the term Guarantee Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business.  The amount of any Guarantee Obligation of any
guaranteeing person shall be deemed to be the lower of (a) an amount equal to
the stated or determinable amount of the primary obligation in respect of which
such Guarantee Obligation is made and (b) the maximum amount for which such
guaranteeing person may be liable pursuant to the terms of the instrument
embodying such Guarantee Obligation, unless such primary obligation and the
maximum amount for which such guaranteeing person may be liable are not stated
or determinable, in which case the amount of such Guarantee Obligation shall be
such guaranteeing person’s maximum reasonably anticipated liability in respect
thereof as determined by the Parent Borrower in good faith.

“Guarantors”:  the
collective reference to the Parent Borrower and each Subsidiary of the Parent
Borrower (other than (a) any Foreign Subsidiary, (b) any Subsidiary of a
Foreign Subsidiary, (c) any Special Purpose Subsidiary, (d) Navigations
Solutions and (e) Hertz Vehicle Sales Corporation), which is from time to time
party to the Domestic Guarantee and

 

16

 

Collateral Agreement or the PRUSVI Guarantee and Collateral Agreement,
as applicable; individually, a “Guarantor”.

“HERC”:  Hertz
Equipment Rental Corporation, together with its successors and assigns.

“Holdings”:  as
defined in the Recitals hereto.

“Indebtedness”:  of
any Person at any date, (a) all indebtedness of such Person for borrowed money
or for the deferred purchase price of property or services (other than trade
liabilities incurred in the ordinary course of business and payable in
accordance with customary practices), (b) any other indebtedness of such Person
which is evidenced by a note, bond, debenture or similar instrument, (c) all
obligations of such Person under Financing Leases, (d) all obligations of such
Person in respect of acceptances issued or created for the account of such
Person, (e) for purposes of subsection 9(e) only, all obligations of such
Person in respect of interest rate protection agreements, interest rate
futures, interest rate options, interest rate caps and any other interest rate
hedge arrangements, and (f) all indebtedness or obligations of the types
referred to in the preceding clauses (a) through (e) to the extent secured by
any Lien on any property owned by such Person even though such Person has not
assumed or otherwise become liable for the payment thereof.

“Indemnified
Liabilities”:  as defined in
subsection 11.5.

“Indentures”:  as defined in the Existing ABL Facility
Credit Agreement as in effect as of the date hereof.

“Individual
Lender Exposure”:  of any Lender, at any time, the aggregate
principal amount of all Revolving Credit Loans made by such Lender and then
outstanding.

“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”:  as defined in subsection 5.9.

“Interest
Payment Date”:  (a) as to any ABR 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, and (c) as to any Eurocurrency Loan having an Interest Period
longer than three months, (i) each day which is three months, or a whole
multiple thereof, after the first day of such Interest Period and (ii) the last
day of such Interest Period.

“Interest
Period”:  with respect 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 months
(or, if required pursuant to subsection 2.1(a), one week) thereafter, as
selected by the 

 

17

 

applicable 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 months
(or if required pursuant to subsection 2.1(a), one week) thereafter, as
selected by the applicable Borrower by irrevocable notice to the Administrative
Agent not less than 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)           any Interest Period that would otherwise extend beyond the
Termination Date shall (for all purposes other than subsection 4.12) end on the
Termination Date;

(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 applicable Borrower shall select Interest Periods so as
not to require a scheduled payment of any Eurocurrency Loan during an Interest
Period for such Loan.

“Interest Rate
Protection Agreement”:  any interest rate protection agreement,
interest rate future, interest rate option, interest rate cap or collar or other
interest rate hedge arrangement in form and substance, and for a term,
reasonably satisfactory to the Administrative Agent, to or under which the
Parent Borrower or any of its Subsidiaries is or becomes a party or a
beneficiary.

“Investment
Company Act”:  the Investment Company Act of 1940, as amended
from time to time.

“Investment
Property”:  ”investment property” (as such term is defined in
Article 9 of the UCC), and any and all supporting obligations in respect
thereof.

“Judgment
Currency”:  as defined in subsection
11.8.

“Kansas
Vehicles”:  Rental Car Vehicles, the
title to which is evidenced by a certificate of title issued by the State of
Kansas or any department or agency thereof.

 

18

 

“Lenders”:  the
several banks and other financial institutions from time to time parties to
this Agreement together with, in each case, any affiliate of any such bank or
financial institution through which such bank or financial institution elects,
by notice to the Administrative Agent, and the Borrowers, to make any Loans
available to any Borrower, provided that for all purposes of voting or
consenting with respect to (a) any amendment, supplementation or modification
of any Loan Document, (b) any waiver of any of the requirements of any Loan
Document or any Default or Event of Default and its consequences or (c) any
other matter as to which a Lender may vote or consent pursuant to subsection
11.1 hereof, the bank or financial institution making such election shall be deemed
the “Lender” rather than such affiliate, which shall not be entitled to so vote
or consent.

“Lien”:  any
mortgage, pledge, hypothecation, assignment, security deposit arrangement,
encumbrance, lien (statutory or other), charge or other security interest or
any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation,
any conditional sale or other title retention agreement and any Financing Lease
having substantially the same economic effect as any of the foregoing).

“Liquidity
Event”: as defined in the Existing ABL Facility Credit Agreement as in
effect as of June 30, 2006.

“LKE Account”:
  any deposit account (i) maintained by, for the benefit of, or under
the control of, the “qualified intermediary” in connection with the LKE Program
and (ii) which holds solely proceeds related to the LKE Program.

“LKE Domestic
Collateral Agent”: as defined in Exhibit C hereto.

“LKE Program”:  a “like-kind-exchange program” with respect
to certain of the Vehicles of the Parent Borrower and its Subsidiaries, under
which such Vehicles will be Disposed from time to time and proceeds of such
Dispositions will be held in a LKE Account and used to acquire replacement
Vehicles and/or repay indebtedness secured by such Vehicles, in a series of
transactions intended to qualify as a “like-kind-exchange” within the meaning
of the Code.

“Loan”:  a
Revolving Credit Loan; collectively, the “Loans”.

“Loan Documents”:  this
Agreement, any Notes, the Domestic Guarantee and Collateral Agreement, the
PRUSVI Guarantee and Collateral Agreement and any other Security Documents,
each as amended, supplemented, waived or otherwise modified from time to time.

“Loan Parties”:  the
Parent Borrower, Puerto Ricancars and each other Subsidiary of the Parent
Borrower that is a party to a Loan Document; individually, a “Loan Party”.  For the avoidance of doubt, no Special
Purpose Subsidiary shall be a Loan Party.

“Management
Investors”:  the collective reference to the officers, directors,
employees and other members of the management of CCMGC, the Parent Borrower or
any of their Subsidiaries, or family members or relatives thereof or trusts for
the benefit of any of the foregoing, who at any particular date shall beneficially
own or have the right to acquire, directly or indirectly, common stock of CCMGC
or any Parent Entity.

 

19

 

“Manufacturer
Repurchase Program Agreement”: a manufacturer repurchase program agreement,
provided that any such agreements entered into after the Closing Date shall be
substantially similar to the agreements existing on the Closing Date or
otherwise acceptable to the Administrative Agent in its commercially reasonable
credit judgment, exercised in good faith in accordance with customary business
practices for comparable asset-based lending transactions.

“Master
Exchange Agreement”: as defined in Exhibit C hereto.

“Material
Adverse Effect”:  a material adverse effect on (a) the business,
operations, property or condition (financial or otherwise) of the Borrowers and
their Subsidiaries taken as a whole or (b) the validity or enforceability as to
any Loan Party thereto of this Agreement or any of the other Loan Documents or
the rights or remedies of the Administrative Agent, the Domestic Collateral
Agent, the PRUSVI Collateral Agent and the Lenders under the Loan Documents or
with respect to the Facility Assets comprising the Domestic Borrowing Base and
the PRUSVI Borrowing Base, in each case taken as a whole.

“Material
Subsidiaries”:  Subsidiaries of the Parent Borrower constituting,
individually or in the aggregate (as if such Subsidiaries constituted a single
Subsidiary), a “significant subsidiary” in accordance with Rule 1-02 under
Regulation S-X.

“Materials of
Environmental Concern”:  any hazardous or toxic substances or
materials or wastes defined, listed, or regulated as such in or under, or which
may give rise to liability under, any applicable Environmental Law, including
gasoline, petroleum (including crude oil or any fraction thereof), petroleum
products or by-products, asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.

“Material
Vehicle Lease Obligation”:  as
defined in the Existing ABL Facility Credit Agreement.

“Merrill Lynch
Investors”:  the collective reference
to (i) ML Global Private Equity Fund, L.P., a Cayman Islands exempted limited
partnership, or any successor thereto, (ii) Merrill Lynch Ventures L.P. 2001, a
Delaware limited partnership, or any successor thereto, (iii) CMC-Hertz
Partners, L.P., a Delaware limited partnership, or any successor thereto, (iv)
ML Hertz Co-Investor, L.P., a Delaware limited partnership, or any successor
thereto, (v) any Affiliate of any thereof, and (vi) any successor in interest
to any thereof.

“Moody’s”:  as
defined in the definition of “Cash Equivalents” in this subsection 1.1.

“MLGPE”:  as defined in the Recitals hereto.

“Multiemployer
Plan”:  a Plan which is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.

“Navigations Solutions”:  Navigation
Solutions, LLC, a Delaware limited liability company.

 

20

 

“Negotiable
Collateral”:  letters of credit, letter of credit rights,
instruments, promissory notes, drafts, documents, and chattel paper (including
electronic chattel paper and tangible chattel paper), and any and all
supporting obligations in respect thereof.

“New Notes”:
the Dollar Senior Notes, the Euro Senior Notes and the Senior Subordinated
Notes.

“New Notes
Indentures”: the indentures dated as of December 21, 2005 under which the
New Notes are issued, as the same may be amended, supplemented, waived or
otherwise modified from time to time.

“Non-Consenting
Lender”: as defined in subsection 11.1(d).

“Non-Excluded
Taxes”:  as defined in subsection 4.11.

“Non-Defaulting
Lender”:  Any Lender other than a Defaulting Lender.

“Notes”:  the
collective reference to the Revolving Credit Notes.

“Obligation
Currency”:  as defined in subsection
11.8.

“Obligor”:  any
purchaser of goods or services or other Person obligated to make payment to the
Parent Borrower or any of its Subsidiaries (other than any Subsidiary that is
not a Loan Party) in respect of a purchase of such goods or services.

“Other
Representatives”:  GE Capital Markets Group, Inc., as sole lead
arranger and bookrunner.

“Parent
Borrower”:  as defined in the Preamble hereto.

“Parent Entity”:  any
of Holdings, and any other Person that is a Subsidiary of Holdings and of which
CCMGC is a subsidiary.

“Participants”:  as
defined in subsection 11.6(c).

“PBGC”:  the
Pension Benefit Guaranty Corporation established pursuant to Subtitle A of
Title IV of ERISA (or any successor thereto).

“Permitted
Discretion”:  the commercially reasonable judgment of the
Administrative Agent, exercised in good faith in accordance with customary
business practices for comparable asset-based lending transactions, as to any
factor which such Agent reasonably determines:  (a) will or
reasonably could be expected to adversely affect in any material respect the
value of any Eligible Accounts or Eligible Vehicles, the enforceability or
priority of the applicable Agent’s Liens thereon or the amount which any Agent
or the Lenders would be likely to receive (after giving consideration to delays
in payment and costs of enforcement) in the liquidation of such Eligible
Accounts or Eligible Vehicles or (b) is evidence that any collateral report or
financial information delivered to such Agent by any Person on behalf of the
applicable Borrower is incomplete, inaccurate or misleading in any material
respect.  In exercising such 

 

21

 

judgment, such Agent may consider, without duplication, such factors
already included in or tested by the definition of Eligible Accounts or Eligible
Vehicles, as well as any of the following:  (i) changes after the
Closing Date in any material respect in any concentration of risk with respect
to Accounts; and (ii) any other factors arising after the Closing Date that
change in any material respect the credit risk of lending to the Borrower on
the security of the Eligible Accounts or Eligible Vehicles.

“Permitted
Holders”:  (a) any of the Equity Investors, Management Investors,
CD&R, Carlyle, MLGPE and any of their respective Affiliates; (b) any investment
fund or vehicle managed, sponsored or advised by CD&R, Carlyle, MLGPE or
any Affiliate thereof, and any Affiliate of or successor to any such investment
fund or vehicle; (c) any limited or general partners of, or other investors in,
any CD&R Investor, Carlyle Investor or Merrill Lynch Investor or any
Affiliate thereof, or any such investment fund or vehicle and (d) any Person
acting in the capacity of an underwriter in connection with a public or private
offering of Capital Stock of CCMGC or any Parent Entity.

“Permitted
Liens”:  as defined in subsection 8.1.

“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 which is covered by ERISA and in
respect of which the Parent Borrower or a Commonly Controlled Entity is an
“employer” as defined in Section 3(5) of ERISA.

“Prime Rate”:  as
defined in the definition of the term “ABR” in this subsection 1.1.

“PRUSVI
Borrowing Base”:  as of any date of determination, the result of,

(a)           85%
of the net book value of Eligible PRUSVI Accounts, plus

(b)           90%
of the net book value of Eligible PRUSVI Program Vehicles, plus

(c)           85%
of the net book value of the Eligible PRUSVI Risk Vehicles, provided, that, nor
more than 10% in the aggregate of the PRUSVI Borrowing Base shall consist of
former Eligible PRUSVI Program Vehicles that are no longer in compliance with
the applicable repurchase program eligibility criteria, plus

(d)           the
sum of all amounts on deposit with, or manufacturer receivables owing to, any
“qualified intermediary” under any LKE Program and derived from or otherwise
attributable to the transfer of Eligible PRUSVI Program Vehicles and Eligible
PRUSVI Risk Vehicles, plus

(e)           the sum of all amounts on deposit in
a Deposit Account over which the PRUSVI Collateral Agent has a perfected first
priority security interest and has control, minus

 

22

 

(f)            the amount of all Availability
Reserves related to the PRUSVI Borrowing Base.

Notwithstanding the
foregoing, the portion of the PRUSVI Borrowing Base consisting of Eligible
PRUSVI Vehicles registered or submitted for registration in Puerto Rico and
Saint Thomas, United States Virgin Islands shall not be more than the lesser of
(i) $35,000,000 and (ii) 20.0% of the Total Borrowing Base.

For purposes of
calculating the PRUSVI Borrowing Base, the net book value of: (i) Eligible
PRUSVI Program Vehicles will be amortized to reflect the values for such
Vehicles as determined under the applicable Manufacturer Repurchase Program
Agreement; (ii) the net book value of Eligible PRUSVI Risk Vehicles will be amortized
to reflect the values for such Vehicles pursuant to the normal depreciation in
the ordinary course of business as determined by Puerto Ricancars; (iii)
Eligible PRUSVI Vehicles will be calculated on a pro forma basis giving effect
to the acquisition of Vehicles to be registered in Puerto Rico or Saint Thomas,
United States Virgin Islands and for which the necessary registration
documentation (including a certificate of title) has been submitted to the
applicable Governmental Authority and (iv) all calculations will be made in
accordance with GAAP.

Upon the
occurrence of and during the continuance of an Existing ABL Facility Advance
Rate Event, with respect to (i) Eligible PRUSVI Program Vehicles and Eligible
PRUSVI Risk Vehicles of a manufacturer that is not then in bankruptcy or that
is then in bankruptcy and which has at such time, as part of its bankruptcy
proceeding, affirmed its obligations under its buyback program with Puerto
Ricancars and resumed making payments to Puerto Ricancars under its buyback
program, the advance rate for Eligible PRUSVI Program Vehicles shall be reduced
to 85% and the advance rate for Eligible PRUSVI Risk Vehicles shall be reduced
to 80%; and (ii) Eligible PRUSVI Program Vehicles of a manufacturer that is
then in bankruptcy and which has not at such time, as part of its bankruptcy
proceeding, affirmed its obligations under its buyback program with Puerto
Ricancars and resumed making payments to Puerto Ricancars under its buyback
program, the advance rates for Eligible PRUSVI Program Vehicles shall each be
reduced to 77%.

Any such
reductions of advance rates shall take effect on the date that is seven (7)
days after the Administrative Agent shall notify Parent Borrower of such
reduction unless prior to such date Parent Borrower shall have remedied the
relevant Existing ABL Facility Advance Rate Event (including, but not limited
to, by way of receipt of any Specified Equity Contribution, as that term is
defined in the Existing ABL Facility) and shall apply to all applicable
Vehicles then included in the PRUSVI Borrowing Base.

“PRUSVI
Collateral Agent”:  as defined in the
Preamble hereto and any successor thereto.

“PRUSVI
Guarantee and Collateral Agreement”:  the PRUSVI Guarantee and
Collateral Agreement delivered to the PRUSVI Collateral Agent as of the date
hereof, substantially in the form of Exhibit B-2, as the same may be amended,
supplemented, waived or otherwise modified from time to time.

 

23

 

“PRUSVI Secured
Parties”:  the “Secured Parties” as
defined in the PRUSVI Guarantee and Collateral Agreement.

“PRUSVI
Security Documents”:  the collective reference to the PRUSVI
Guarantee and Collateral Agreement and all other similar security documents
hereafter delivered to the PRUSVI Collateral Agent granting or perfecting a
Lien on any asset or assets of any Person to secure the obligations and
liabilities of Puerto Ricancars hereunder and/or under any of the other Loan
Documents or to secure any guarantee of any such obligations and liabilities,
in each case, as amended, supplemented, waived or otherwise modified from time
to time.

“Refinance”:  with
respect to any then outstanding Indebtedness, the issuance of Indebtedness
issued or given in exchange for, or the proceeds of which are used to, extend,
refinance, renew, replace, substitute or refund such theretofore outstanding
Indebtedness.

“Register”:  as
defined in subsection 11.6(b).

“Regulation S-X”:  Regulation
S-X promulgated by the Securities and Exchange Commission, as in effect on the
Closing Date.

“Regulation T”:  Regulation
T of the Board as in effect from time to time.

“Regulation U”:  Regulation
U of the Board as in effect from time to time.

“Regulation X”:  Regulation
X of the Board as in effect from time to time.

“Rental Car
Revenue Earning Vehicles”:  all passenger Vehicles owned by or
leased to either Borrower that are classified as “revenue earning equipment” in
the consolidated financial statements of the Parent Borrower and are or have
been offered for lease or rental by either Borrower in its car rental
operations (and not, for the avoidance of doubt, in connection with any
business or operations involving the leasing or renting of other types of
Equipment), including any such Vehicles being held for sale.

“Rental Car
Service Vehicles”:  all passenger
Vehicles, other than Vehicles that may lawfully be used to transport more than
15 passengers, owned by or leased to either Borrower that are classified as
“plant, property and equipment” in the consolidated financial statements of the
Parent Borrower and are or have been utilized by either Borrower in its car
rental operations (and not, for the avoidance of doubt, in connection with any
business or operations involving the leasing or renting of other types of
Equipment), including any such Vehicles being held for sale.

“Rental Car
Vehicles”:  all Rental Car Revenue Earning Vehicles and all
Rental Car Service Vehicles.

“Reorganization”:  with
respect to any Multiemployer Plan, the condition that such plan is in reorganization
within the meaning of Section 4241 of ERISA.

 

24

 

“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 .13, .14, .16, .18, .19 or .20 of PBGC Reg. § 2615 or any
successor regulation thereto.

“Required
Lenders”:  Lenders the sum of whose outstanding Revolving
Facility Commitments (or after the termination thereof, outstanding Individual
Lender Exposures) represent at least a majority of Total Revolving Facility
Commitment less the Revolving Facility Commitments of all Defaulting Lenders
(or after the termination thereof, the sum of the Individual Lender Exposures
of Non-Defaulting Lenders) at such time; provided, that, if there are
two or more Lenders, then in any event, Required Lenders shall consist of at
least two Lenders

“Requirement 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, statute, ordinance, code, decree, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its material
property or to which such Person or any of its material property is subject,
including laws, ordinances and regulations pertaining to zoning, occupancy and
subdivision of real properties; provided that the foregoing shall not
apply to any non-binding recommendation of any Governmental Authority.

“Responsible
Officer”:  as to any Person, any of the following officers of
such Person:  (a) the chief executive officer or the president of
such Person and, with respect to financial matters, the chief financial
officer, the treasurer or the controller of such Person, (b) any vice president
of such Person or, with respect to financial matters, any assistant treasurer
or assistant controller of such Person, who has been designated in writing to
the Administrative Agent as a Responsible Officer by such chief executive
officer or president of such Person or, with respect to financial matters, such
chief financial officer of such Person, (c) with respect to subsection 7.7 and
without limiting the foregoing, the general counsel of such Person and
(d) with respect to ERISA matters, the senior vice president - human resources
(or substantial equivalent) of such Person.

“Revolving
Credit Lender”:  any Lender having a
Revolving Facility Commitment hereunder and/or a Revolving Credit Loan
outstanding hereunder.

“Revolving
Credit Loan”:  as provided in subsection 2.1(a).

“Revolving
Credit Note”:  as defined in subsection 2.1(d).

“Revolving
Facility”:  the revolving credit facility available to the
Borrowers hereunder.

“Revolving
Facility Commitment”: with respect to each Lender, the commitment of such
Lender hereunder to make Extensions of Credit to the Borrowers in the amount
set forth opposite its name on Schedule A hereto or as may subsequently be set
forth in the Register from time to time.

 

25

 

“Revolving
Facility Commitment Percentage”:  of any Lender at any time shall
be that percentage which is equal to a fraction (expressed as a percentage) the
numerator of which is the Revolving Facility Commitment of such Lender at such
time and the denominator of which is the Total Revolving Facility Commitment at
such time, provided that if any such determination is to be made after
the Total Revolving Facility Commitment (and the related Revolving Facility
Commitments of the Lenders) has (or have) terminated, the determination of such
percentages shall be made immediately before giving effect to such termination.

“Revolving
Facility Lender”:  each Lender which has a Revolving Facility
Commitment or which has any outstanding Revolving Credit Loans.  Unless the context otherwise requires, each
reference in this Agreement to a Revolving Facility Lender includes each
Revolving Facility Lender and shall include references to any Affiliate of any
such Lender which is acting as a Revolving Facility Lender.

“S&P”:  as
defined in the definition of the term “Cash Equivalents” in this subsection
1.1.

“Sale and
Leaseback Transaction”:  as defined in the Existing ABL Facility
Credit Agreement (as in effect on the date hereof).

“Secured
Parties”:  the reference to the PRUSVI Secured Parties, the Domestic
Secured Parties, or the collective reference thereto, as applicable.

“Securities Act”:  the
Securities Act of 1933, as amended from time to time.

“Security
Provisions”:  as defined in Section
6.1 (l)

“Security
Documents”:  the collective reference to the PRUSVI Security
Documents and the Domestic Security Documents.

“Seller”:  as
defined in the Recitals.

“Senior
Subordinated Notes”:  10.500% Senior
Subordinated Notes due 2016 of the Parent Borrower, as the same may be
exchanged for substantially similar unsecured senior subordinated notes, that
have been registered under the Securities Act, and as the same or such
substantially similar notes may be amended, supplemented, waived or otherwise
modified from time to time.

“Senior
Subordinated Notes Indenture”:  the
indenture governing the 10.500% Senior Subordinated Notes due 2016 of Parent
Borrower issued on December 21, 2005, as the same may be exchanged for
substantially similar unsecured senior notes or unsecured senior subordinated
notes, as applicable, that have been registered under the Securities Act, and
as the same or such substantially similar notes may be amended, supplemented,
waived or otherwise modified from time to time.

“Senior Term
Facility”:  as defined in the Recitals, and as the same may be
amended, supplemented, waived or otherwise modified from time to time, or
refinanced or replaced from time to time.

 

26

 

“Senior Term
Loans”:  as defined in the Recitals, and as the same may be
amended, supplemented, waived or otherwise modified from time to time, or
refinanced or replaced from time to time.

“Senior Term
Loans Credit Agreement”:  as defined
in the Existing ABL Facility Credit Agreement, as amended, modified or
supplemented from time to time.

“Senior Term
Loans Documents”:  the “Loan
Documents” as defined in the Senior Term Loans Credit Agreement, and as the
same may be amended, supplemented, waived or otherwise modified from time to
time, or refinanced or replaced from time to time.

“Set”:  the collective reference to Eurocurrency
Loans, 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).

“Single Employer
Plan”:  any Plan which is covered by Title IV of ERISA, but which
is not a Multiemployer Plan.

“Solvent” and
“Solvency”:  with respect to any Person on a particular date, the
condition that, on such date, (a) the fair value of the property of such Person
is greater than the total amount of liabilities, including contingent
liabilities, of such Person, (b) the present fair salable value of the
assets of such Person is not less than the amount that will be required to pay
the probable liability of such Person on its debts as they become absolute and
matured, (c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person’s ability to pay as such debts
and liabilities mature, and (d) such Person is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for which
such Person’s property would constitute an unreasonably small amount of
capital.

“Special
Purpose Entity”:  (x) any
Special Purpose Subsidiary or (y) any other Person that is engaged in the
business of acquiring, selling, leasing, financing or refinancing Vehicles
and/or other Equipment, and/or related rights (including under leases,
manufacturer warranties and buy-back programs, and insurance policies) and/or
assets (including managing, exercising and disposing of any such rights and/or
assets).

“Special
Purpose Financing Documents”: any documents pursuant to which any Special
Purpose Financings (including the U.S. Securitization) are consummated.

“Special
Purpose Financing”: any financing or refinancing of assets consisting of or
including Vehicles and/or other Equipment of the Parent Borrower or any
Subsidiary that have been transferred to a Special Purpose Entity or made
subject to a Lien in a Financing Disposition.

“Special
Purpose Financing Undertakings”: representations, warranties, covenants,
indemnities, guarantees of performance and (subject to clause (y) of the
proviso below) other agreements and undertakings entered into or provided by
the Parent Borrower or any of its Subsidiaries that the Parent Borrower
determines in good faith (which determination shall be conclusive) are
customary or otherwise necessary or advisable in connection with a Special
Purpose Financing or a Financing Disposition; provided that (x) it is
understood that

 

27

 

Special Purpose Financing Undertakings may consist of or include (i)
reimbursement and other obligations in respect of notes, letters of credit,
surety bonds and similar instruments provided for credit enhancement purposes
or (ii) hedging obligations, or other obligations relating to Interest Rate
Protection Agreements or Permitted Hedging Arrangements entered into by the
Parent Borrower or any Subsidiary, in respect of any Special Purpose Financing
or Financing Disposition, and (y) subject to the preceding clause (x), any such
other agreements and undertakings shall not include any Guarantee Obligations
in respect of Indebtedness of a Special Purpose Subsidiary by the Parent
Borrower or a Subsidiary that is not a Special Purpose Subsidiary.

“Special
Purpose Subsidiary”:  a Subsidiary of the Parent Borrower that
(a) is engaged solely in (x) the business of acquiring, selling, leasing,
financing or refinancing Vehicles and/or Equipment and/or related rights
(including under leases, manufacturer warranties and buy-back programs, and
insurance policies) and/or assets (including managing, exercising and disposing
of any such rights and/or assets), all proceeds thereof and all rights
(contractual and other), collateral and other assets relating thereto, and (y)
any business or activities incidental or related to such business, and (b) is
designated as a “Special Purpose Subsidiary” by the board of directors of the
Parent Borrower.

“Specified
Obligations”:  obligations of the Loan Parties under the Loan
Documents consisting of the payment of principal of and interest on Loans.

“Sponsors”:  as defined in the Recitals hereto.

“Subsidiary”:  as
to any Person, a corporation, partnership, limited liability company or other
entity (a) of which shares of stock or other ownership interests having
ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to elect a
majority of the board of directors or other managers of such corporation,
partnership, limited liability company or other entity are at the time owned by
such Person, or (b) the management of which is otherwise controlled, directly
or indirectly through one or more intermediaries, or both, by such Person and,
in the case of this clause (b), which is treated as a consolidated subsidiary
for accounting purposes.  Unless
otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this
Agreement shall refer to a Subsidiary or Subsidiaries of the Parent Borrower.

“Taxes”: as
defined in subsection 4.11(a).

“Termination
Date”:  December 21, 2011.

“Total
Borrowing Base”:  collectively, the
Domestic Borrowing Base and the PRUSVI Borrowing Base.

“Total
Revolving Facility Commitment”:  at any time, the sum of the
Revolving Facility Commitments of all of the Lenders at such time.  The original Total Revolving Facility
Commitment is $275,000,000.

“Transferee”:  any
Participant or Assignee.

 

28

 

“Treaty”:  the
Treaty establishing the European Economic Community, being the Treaty of Rome
of March 25, 1957 as amended by the Single European Act 1986 and the Maastricht
Treaty (which was signed on February 7, 1992 and came into force on November 1,
1993) and as may, from time to time, be further amended, supplemented or
otherwise modified.

“Type”:  the
type of Loan determined based on the currency in which the same is denominated,
and the interest option applicable thereto, with there being multiple Types of
Loans hereunder, namely ABR Loans and Eurocurrency Loans.

“UCC”:  the
Uniform Commercial Code as in effect in the State of New York from time to
time.

“Underfunding”:  the
excess of the present value of all accrued benefits under a Plan (based on
those assumptions used to fund such Plan), determined as of the most recent
annual valuation date, over the value of the assets of such Plan allocable to
such accrued benefits.

“Unutilized
Borrowing Base” means an amount equal to the remainder of (x) the sum of
the Domestic Borrowing Base and the PRUSVI Borrowing Base less (y) the total
Individual Lender Exposure for all Lenders.

“Unutilized
Revolving Facility Commitment”:  with respect to any Lender at
any time, an amount equal to the remainder of (x) such Lender’s Revolving
Facility Commitment as in effect at such time less (y) such Lender’s Individual
Lender Exposure at such time.

“U.S. ABS
Program Documents”:  collectively,
the documents and agreements delivered in connection with those certain U.S.
rental car asset backed securities issued by Hertz Vehicle Financing LLC, as
amended, modified, supplemented or refinanced from time to time.

“U.S. Extender
of Credit”: as defined in subsection 4.11(b).

“U.S. Tax Compliance
Certificate”:  as defined in subsection 4.11(b).

“Vehicles”
means motor vehicles owned or operated by, or leased or rented to or by, the
Parent Borrower or Puerto Ricancars, including automobiles, trucks, vans, sport
utility vehicles and other motor vehicles.

“Wholly Owned
Subsidiary”:  as to any Person, any Subsidiary of such Person of
which such Person owns, directly or indirectly through one or more Wholly Owned
Subsidiaries, all of the Capital Stock of such Subsidiary other than directors
qualifying shares or shares held by nominees.

1.2           Other
Definitional Provisions.  (a)  Unless otherwise specified therein, all terms
defined in this Agreement shall have the defined meanings when used in any
Notes, any other Loan Document or any certificate or other document made or
delivered pursuant hereto.

(b)           As
used herein and in any Notes and any other Loan Document, and any certificate
or other document made or delivered pursuant hereto or thereto, accounting
terms 

 

29

 

relating to Borrowers and their respective Subsidiaries not
defined in subsection 1.1 and accounting terms partly defined in subsection
1.1, to the extent not defined, shall have the respective meanings given to
them under GAAP.

(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, subsection, Schedule and
Exhibit references are to this Agreement unless otherwise specified.  The words “include”, “includes” and “including” shall be
deemed to be followed by the phrase “without limitation”.

(d)           The
meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.

SECTION 2.  AMOUNT AND TERMS OF COMMITMENTS.

2.1           Commitments.

(a)           Subject
to and upon the terms and conditions set forth herein, each Lender with a
Revolving Facility Commitment severally agrees to make, at any time and from
time to time on or after the Closing Date and prior to the Termination Date, a
Revolving Credit Loan or Revolving Credit Loans to each Borrower, as
applicable, (each a “Revolving Credit Loan” and, collectively, the “Revolving
Credit Loans”), which Revolving Credit Loans:

(i)            shall
be denominated in Dollars;

(ii)           shall,
at the option of the Borrowers, be incurred and maintained as, and/or converted
into, ABR Loans or Eurocurrency Loans, provided that,  except as otherwise specifically provided in
subsection 4.9 and subsection 4.10, all Revolving Credit Loans comprising the
same Borrowing shall at all times be of the same Type;

(iii)          may be repaid and reborrowed in accordance with the
provisions hereof;

(iv)          shall not be made (and shall not be required to be made) by
any Lender to the extent the incurrence thereof (after giving effect to the use
of the proceeds thereof on the date of the incurrence thereof to repay any
amounts theretofore outstanding pursuant to this Agreement) would cause the
Individual Lender Exposure of such Lender to exceed the amount of its Revolving
Facility Commitment at such time;

(v)           shall
not be made (and shall not be required to be made) by any Lender to the extent
the incurrence thereof (after giving effect to the use of the proceeds thereof
on the date of the incurrence thereof to repay any amounts theretofore
outstanding pursuant to this Agreement) would cause the Aggregate Lender
Exposure outstanding to both Borrowers to exceed the Total Revolving Facility
Commitment as then in effect.

 

30

 

(b)           Revolving
Credit Loans shall not be made to (i) the Parent Borrower to the extent the
incurrence thereof would cause the Aggregate Lender Exposure outstanding to
Parent Borrower to exceed  the Domestic
Borrowing Base at such time (based on the Borrowing Base Certificate last
delivered), or (ii) Puerto Ricancars to the extent the incurrence thereof would
cause the Aggregate Lender Exposure outstanding to Puerto Ricancars to exceed
the PRUSVI Borrowing Base at such time (based on the Borrowing Base Certificate
last delivered).

(c)           Notwithstanding
anything to the contrary in subsection 2.1(a) or elsewhere in this Agreement,
the Administrative Agent shall have the right to establish Availability Reserves
in such amounts, and with respect to such matters, affecting the Domestic
Borrowing Base, the PRUSVI Borrowing Base or the Total Borrowing Base, as the
Administrative Agent, in its Permitted Discretion shall deem necessary or
appropriate, against the Domestic Borrowing Base, PRUSVI Borrowing Base and
Total Borrowing Base, including reserves with respect to (i) sums that the
respective Borrowers are or will be required to pay (such as taxes (including
payroll and sales taxes), assessments, insurance premiums, or, in the case of
leased assets, rents or other amounts payable under such leases) and have not
yet paid and (ii) amounts owing by the respective Borrowers or, without
duplication, their respective Subsidiaries to any Person to the extent secured by
a Lien on, or trust over, any of the Facility Assets, which Lien or trust, in
the Permitted Discretion of the Administrative Agent is capable of ranking
senior in priority to or pari passu with
one or more of the Liens granted in the Security Documents (such as Liens or
trusts in favor of landlords, warehousemen, carriers, mechanics, materialmen,
laborers, or suppliers, or Liens or trusts for ad valorem, excise, sales, or
other taxes where given priority under applicable law) in and to such Facility
Asset; provided that the Administrative Agent shall have provided the
applicable Borrower at least ten Business Days’ prior written notice of any
such establishment; and provided, further, that the
Administrative Agent may only establish an Availability Reserve after the date
hereof based on an event, condition or other circumstance arising after the
Closing Date or based on facts not known to such Agent as of the Closing
Date.  The amount of any Availability
Reserve established by such Agent shall have a reasonable relationship to the
event, condition or other matter that is the basis for the Availability
Reserve.  Upon delivery of such notice,
such Agent shall be available to discuss the proposed Availability Reserve, and
the applicable Borrower may take such action as may be required so that the
event, condition or matter that is the basis for such Availability Reserve or
increase no longer exists, in a manner and to the extent reasonably
satisfactory to the Agent in the exercise of its Permitted Discretion.  In no event shall such notice and opportunity
limit the right of the Agent to establish such Availability Reserve, unless
such Agent shall have determined in its Permitted Discretion that the event,
condition or other matter that is the basis for such new Availability Reserve
no longer exists or has otherwise been adequately addressed by the applicable
Borrower.  Notwithstanding anything
herein to the contrary, Reserves shall not duplicate eligibility criteria
contained in the definition of “Eligible Accounts”, “Eligible Vehicles” and
vice versa, or reserves or criteria deducted in computing the net book value of
“Eligible Vehicles”.

(d)           Each
Borrower agrees that, upon the request to the Administrative Agent by any
Revolving Credit Lender made on or prior to the Closing Date or in connection
with any assignment pursuant to subsection 11.6(b), in order to evidence such
Lender’s Revolving Credit Loans, such Borrower will execute and deliver to such
Lender a promissory note substantially in the form of Exhibit A-1, with
appropriate insertions as to payee, date and principal amount (each, as
amended, supplemented, replaced or otherwise modified from time to time, a “Revolving

 

31

Credit Note”), payable
to such Lender and in a principal amount equal to the aggregate unpaid
principal amount of all Revolving Credit Loans made by such Revolving Credit
Lender to such Borrower.  Each Revolving
Credit Note shall (i) be dated the Closing Date, (ii) be stated to mature on the
Termination Date and (iii) provide for the payment of interest in accordance
with subsection 4.1.

(e)           Notwithstanding
anything to the contrary contained herein, the parties acknowledge and agree
that (i) the Parent Borrower shall not be jointly or jointly and severally
liable with Puerto Ricancars for any liabilities or obligations of Puerto
Ricancars hereunder and (ii) Puerto Ricancars shall not be jointly or jointly
and severally liable with the Parent Borrower for any liabilities or
obligations of the Parent Borrower hereunder.

2.2           Procedure
for Revolving Credit Borrowing.  Each
of the Borrowers may borrow under the Revolving Facility Commitments during the
Commitment Period on any Business Day, provided that the applicable
Borrower shall give the Administrative Agent, irrevocable notice (which notice
must be received by the Administrative Agent prior to (a) 12:30 P.M., New York
City time, at least three Business Days prior to the requested Borrowing Date,
if all or any part of the requested Revolving Credit Loans are to be initially
Eurocurrency Loans made in Dollars, or (b) 10:00 a.m., New York City time,
on the requested Borrowing Date, for ABR Loans made in Dollars specifying (i)
the identity of the Borrower, (ii) the amount to be borrowed, (iii) the
requested Borrowing Date, (iv) whether the borrowing is to be of
Eurocurrency Loans, ABR Loans or a combination thereof and (v) if the borrowing
is to be entirely or partly of Eurocurrency Loans, the respective amounts of
each such Type of Loan and the respective lengths of the initial Interest
Periods therefor.  Each borrowing shall
be in an amount equal to (x) in the case of ABR Loans, in multiples of
$1,000,000 (or, if the Revolving Facility Commitments then available (as
calculated in accordance with subsection 2.1(a)) are less than $1,000,000, such
lesser amount) and (y) in the case of Eurocurrency Loans shall be in an
amount equal to $5,000,000 or a whole multiple of $1,000,000 in excess
thereof.  Upon receipt of any such notice
from a Borrower, the Administrative Agent, shall promptly notify each
applicable Revolving Credit Lender thereof. 
Subject to the satisfaction of the conditions precedent specified in
subsection 6.2, each applicable Revolving Credit Lender will make the amount of
its pro rata share of each borrowing of Revolving Credit Loans available to the
Administrative Agent for the account of the Borrower identified in such notice
at the office of the Administrative Agent, specified in subsection 11.2 prior
to 12:30 P.M. (or 10:00 A.M., in the case of the initial borrowing hereunder),
New York City time, or at such other office of the Administrative Agent, or at
such other time as to which the Administrative Agent shall notify such Borrower
reasonably in advance of the Borrowing Date with respect thereto, on the
Borrowing Date requested by such Borrower in Dollars and in funds immediately
available to the Administrative Agent.

2.3           Termination
or Reduction of Revolving Facility Commitments.  The Parent Borrower (on behalf of itself and
each other Borrower) shall have the right, upon not less than three Business
Days’ notice to the Administrative Agent (which will promptly notify the
Lenders thereof), to terminate the Revolving Facility Commitments or, from time
to time, to reduce the amount of the Revolving Facility Commitments; provided
that no such termination or reduction shall be permitted if, after giving
effect thereto and to any prepayments of the Revolving Credit Loans made on the
effective date thereof, the aggregate principal amount of the

 

32

Revolving Credit Loans then outstanding, would exceed the
Revolving Facility Commitments then in effect. 
Any such reduction shall be in an amount equal to $5,000,000 or a whole
multiple of $1,000,000 in excess thereof and shall reduce permanently the
applicable Revolving Facility Commitments then in effect.

2.4           Reserved.

2.5           Reserved.

2.6           Reserved.

2.7           Reserved.

2.8           Repayment
of Loans.  (a)  Each Borrower hereby unconditionally promises
to pay to the Administrative Agent (in the currency in which such Loan is
denominated) for the account of each Lender the then unpaid principal amount of
each Revolving Credit Loan of such Lender made to such Borrower, on the
Termination Date (or such earlier date on which the Revolving Credit Loans
become due and payable pursuant to Section 9). 
Each Borrower hereby further agrees to pay interest (which payments
shall be in the same currency in which the respective Loan referred to above is
denominated) on the unpaid principal amount of such Loans from time to time
outstanding from the date hereof until payment in full thereof at the rates per
annum, and on the dates, set forth in subsection 4.1.

(b)           Reserved.

(c)           Each
Lender shall maintain in accordance with its usual practice an account or
accounts evidencing indebtedness of each of the Borrowers to such Lender
resulting from each Loan of such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Agreement.

(d)           The
Administrative Agent shall maintain the Register pursuant to subsection
11.6(b), and a subaccount therein for each Lender, in which shall be recorded
(i) the amount of each Loan made hereunder, the Type thereof, the Borrowers to
which such Loan is made, each Interest Period, if any, applicable thereto, (ii)
the amount of any principal or interest due and payable or to become due and
payable from each of the Borrowers to each applicable Lender hereunder and
(iii) both the amount of any sum received by the Administrative Agent hereunder
from each of the Borrowers and each applicable Lender’s share thereof.

(e)           The
entries made in the Register and the accounts of each Lender maintained
pursuant to subsection 2.8(d) shall, to the extent permitted by applicable law,
be prima facie evidence of the existence and amounts of the obligations of each
of the Borrowers therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of any Borrower to repay (with applicable interest) the Loans made
to such Borrower by such Lender in accordance with the terms of this Agreement.

 

33

 

SECTION 3.  RESERVED.

SECTION 4.  GENERAL PROVISIONS APPLICABLE TO LOANS.

4.1           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 in effect for such day.

(b)           Each
ABR Loan shall bear interest for each day that it is outstanding at a rate per
annum equal to the ABR for such day plus the Applicable Margin in effect for
such day.

(c)           If
all or a portion of (i) the principal amount of any Loan, (ii) any interest
payable thereon or (iii) 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 which
is (x) in the case of overdue principal, the rate that would otherwise be
applicable thereto pursuant to the relevant foregoing provisions of this subsection
plus 2.00%, (y) in the case of overdue interest, the rate that would be
otherwise applicable to principal of the related Loan pursuant to the relevant
foregoing provisions of this subsection (other than clause (x) above) plus
2.00% and (z) in the case of, fees, commissions or other amounts, the rate
described in paragraph (b) of this subsection for ABR Loans that are Revolving
Credit Loans accruing interest at the ABR rate plus 2.00%, in each case 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 subsection shall be payable
from time to time on demand.

(e)           It
is the intention of the parties hereto to comply strictly with applicable usury
laws; accordingly, it is stipulated and agreed that the aggregate of all
amounts which constitute interest under applicable usury laws, whether
contracted for, charged, taken, reserved, or received, in connection with the
indebtedness evidenced by this Agreement or any Notes, or any other document
relating or referring hereto or thereto, now or hereafter existing, shall never
exceed under any circumstance whatsoever the maximum amount of interest allowed
by applicable usury laws.

4.2           
Conversion and Continuation Options.

(a)           The applicable Borrowers may elect from time to time to
convert outstanding Revolving Credit Loans from Eurocurrency Loans made or
outstanding in Dollars to ABR Loans, by giving the Administrative Agent
irrevocable notice of such election prior to 11:00 a.m. (New York time) on the
second Business Day prior to such conversion, provided that any such
conversion of Eurocurrency Loans may only be made on the last day of an
Interest Period with respect thereto. 
The Borrowers may elect from time to time to convert outstanding
Revolving Credit Loans from ABR Loans to Eurocurrency Loans by giving the
Administrative Agent irrevocable notice of such election prior to 11:00 a.m.
(New York time) on the third Business Day prior to such conversion.  Any such notice of conversion to Eurocurrency
Loans

 

34

 

shall specify the length
of the initial Interest Period or Interest Periods therefor.  Upon receipt of any such notice the
Administrative Agent shall promptly notify each affected Lender thereof.  All or any part of outstanding Eurocurrency
Loans and ABR Loans may be converted as provided herein, provided that (i) (unless
the Required Lenders otherwise consent) no Loan may be converted into a
Eurocurrency Loan when any Default or Event of Default has occurred and is
continuing and, in the case of any Default, the Administrative Agent has given
notice to the applicable Borrower that no such conversions may be made and (ii) no
Loan may be converted into a Eurocurrency Loan after the date that is one month
prior to the Termination Date.

(b)           Any
Eurocurrency Loan may be continued as such upon the expiration of the then
current Interest Period with respect thereto by the applicable Borrowers giving
notice to the Administrative Agent of the length of the next Interest Period to
be applicable to such Loan, determined in accordance with the applicable
provisions of the term “Interest Period” set forth in subsection 1.1, provided
that no Eurocurrency Loan may be continued as such (i) (unless the Required
Lenders otherwise consent) when any Default or Event of Default has occurred
and is continuing and, in the case of any Default, the Administrative Agent has
given notice to the applicable Borrower that no such continuations may be made
or (ii) after the date that is one month prior to either the Termination Date,
and provided, further, that in the case of Eurocurrency Loans
made or outstanding in Dollars if the applicable Borrower shall fail to give
any required notice as described above in this paragraph or if such
continuation is not permitted pursuant to the preceding proviso such
Eurocurrency Loans shall be automatically converted to ABR Loans on the last
day of such then expiring Interest Period. 
Upon receipt of any such notice of continuation pursuant to this
subsection 4.2(b), the Administrative Agent shall promptly notify each affected
Lender thereof.

4.3           Minimum
Amounts of Sets.  All borrowings,
conversions and continuations of Loans hereunder and all selections of Interest
Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, the aggregate principal amount
of the Eurocurrency Loans comprising each Set shall be equal to $5,000,000 or a
whole multiple of $1,000,000 in excess thereof and so that there shall not be
more than 25 Sets at any one time
outstanding.

4.4           Optional
and Mandatory Prepayments.  (a)  Each of the Borrowers may at any time and
from time to time prepay the Loans made to it, in whole or in part, subject to
subsection 4.12, without premium or penalty, by irrevocable written notice by the
applicable Borrower to the Administrative Agent given prior to 11:00 a.m. (New
York time) on the third Business Day prior to such payment (in the case of
Eurocurrency Loans) or prior to 11:00 a.m. (New York time) on the Business Day
prior to such payment (in the case of ABR Loans).  Such notice shall specify, in the case of any
prepayment of Loans, the identity of the prepaying Borrower, the date and
amount of prepayment and whether the prepayment is of Eurocurrency Loans, ABR
Loans or a combination thereof, and, in each case if a combination thereof, the
principal amount allocable to each.  Upon
the receipt of any such notice the Administrative Agent shall promptly notify
each affected 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 (if a Eurocurrency Loan is
prepaid other than at the end of the Interest Period applicable thereto) any
amounts payable pursuant to subsection 4.12. 
The Revolving Credit Loans pursuant to this subsection shall (unless the
Parent Borrower otherwise directs) be applied, first, to

 

35

payment of the Revolving Credit Loans then outstanding, and then,
to all other amounts then due and owing hereunder.  Partial prepayments pursuant to this
subsection 4.4(a) shall be in multiples of $1,000,000, provided that,
notwithstanding the foregoing, any Loan may be prepaid in its entirety.

(b)           (i)
On any day on which the Aggregate Lender Exposure outstanding to Puerto
Ricancars exceeds the PRUSVI Borrowing Base at such time (based on the
Borrowing Base Certificate last delivered), Puerto Ricancars shall prepay on
such day the principal of Revolving Credit Loans made to it in an amount equal
to such excess.

(ii)           On any day on which the Aggregate Lender Exposure
outstanding to Parent Borrower exceeds the Domestic Borrowing Base (based on
the Borrowing Base Certificate last delivered), the Parent Borrower shall
prepay on such day the principal of Revolving Credit Loans made to it in an
amount equal to such excess.

(iii)          On any day on which the Aggregate Lender Exposure
outstanding to both Borrowers exceeds the Total Revolving Facility Commitment
at such time, the Borrowers shall prepay on such day the principal of Revolving
Credit Loans in an amount equal to such excess.

(c)           For
avoidance of doubt, the Revolving Facility Commitments shall not be
correspondingly reduced by the amount of any prepayments of Revolving Credit
Loans made under subsection 4.4(b).

(d)           Notwithstanding
the foregoing provisions of this subsection 4.4, if at any time any prepayment
of the Loans pursuant to subsection 4.4(a) or 4.4(b) would result, after giving
effect to the procedures set forth in this Agreement, in any Borrower incurring
breakage costs under subsection 4.12 as a result of Eurocurrency Loans being
prepaid other than on the last day of an Interest Period with respect thereto,
then, the relevant Borrower may, so long as no Default or Event of Default
shall have occurred and be continuing, in its sole discretion, initially (i)
deposit a portion (up to 100%) of the amounts that otherwise would have been
paid in respect of such Eurocurrency Loans with a Lender (which is able to
accept deposits and pay interest thereon to the applicable Borrower), for the
benefit of the Administrative Agent and Lenders, (which deposit must be equal
in amount to the amount of such Eurocurrency Loans not immediately prepaid), to
be held as security for the obligations of such Borrowers to make such
prepayment pursuant to a cash collateral agreement to be entered into on terms
reasonably satisfactory to the Administrative Agent, as applicable, with such
cash collateral to be directly applied upon the first occurrence thereafter of
the last day of an Interest Period with respect to such Eurocurrency Loans (or
such earlier date or dates as shall be requested by such Borrower); or (ii)
make a prepayment of the Revolving Credit Loans in accordance with subsection
4.4(a) with an amount equal to a portion (up to 100%) of the amounts that
otherwise would have been paid in respect of such Eurocurrency Loans (which
prepayment, together with any deposits pursuant to clause (i) above, must be
equal in amount to the amount of such Eurocurrency Loans not immediately
prepaid), provided, that, in the case of either clause (i) or
(ii), such unpaid Eurocurrency Loans shall continue to bear interest in
accordance with subsection 4.1 until such 

 

36

 

unpaid Eurocurrency Loans or the related portion of such
Eurocurrency Loans have or has been prepaid.

4.5           Commitment
Fees; Administrative Agent’s Fee; Other Fees.  (a) 
Each Borrower agrees to pay (such payment to be made pro rata based on
the most recent Domestic Borrowing Base and PRUSVI Borrowing Base) to the
Administrative Agent, for the account of each Lender a commitment fee for the
period from and including the first day of the Commitment Period to the
Termination Date, computed at the Commitment Fee Rate on the average daily
amount of the Unutilized Revolving Facility Commitment of such Revolving Credit
Lender during the period for which payment is made, payable quarterly in
arrears on the last day of each March, June, September and December and on the
Termination Date or such earlier date as the Revolving Facility Commitments
shall terminate as provided herein provided, that, prior to the
60th day following the Closing Date, the commitment fee for such period from
and including the Closing Date shall be computed at the Commitment Fee Rate on
the lesser of (i) the average daily amount of the Unutilized Revolving Facility
Commitment of such Revolving Credit Lender and (ii) the average daily amount of
the Unutilized Borrowing Base.

(b)           Each
Borrower agrees to pay to the Administrative Agent any fees in the amounts and
on the dates previously agreed to in writing (including, without limitation, in
any fee letters) by the Borrowers and the Administrative Agent in connection
with this Agreement.

4.6           Computation
of Interest and Fees.  (a)  Interest (other than interest based on the
Prime Rate) shall be calculated on the basis of a 360-day year for the actual
days elapsed; and commitment fees and interest based on the Prime Rate, shall
be calculated on the basis of a 365-day year (or 366-day year, as the case may
be) for the actual days elapsed.  The
Administrative Agent shall as soon as practicable notify the Parent Borrower
and the affected 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 Parent Borrower
and the affected 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 each of the
Borrowers and the Lenders in the absence of manifest error.  The Administrative Agent shall, at the
request of the Parent Borrower or any Lender, deliver to the Parent Borrower or
such Lender a statement showing in reasonable detail the calculations used by
the Administrative Agent in determining any interest rate pursuant to
subsection 4.1, excluding any Eurocurrency Base Rate which is based upon the
Telerate British Bankers Assoc. Interest Settlement Rates Page and any ABR Loan
which is based upon the Prime Rate.

4.7           Inability
to Determine Interest Rate.  If prior
to the first day of any Interest Period, the Administrative Agent shall have
determined (which determination shall be conclusive and binding upon each of
the Borrowers) that, by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining the Eurocurrency
Rate with respect to any Eurocurrency Loan (the “Affected Eurocurrency Rate”)
for such Interest Period, the Administrative Agent shall give telecopy or
telephonic notice thereof to the Parent Borrower

 

37

and the Lenders as soon as practicable thereafter.  If such notice is given (a) any Eurocurrency
Loans, the rate of interest applicable to which is based on the Affected
Eurocurrency Rate requested to be made on the first day of such Interest Period
shall be made as ABR Loans (to the extent otherwise permitted by subsection
4.2), (b) any Loans that were to have been converted on the first day of such
Interest Period to or continued as Eurocurrency Loans the rate of interest
applicable to which is based upon the Affected Eurocurrency Rate shall be
converted to or continued as ABR Loans (to the extent otherwise permitted by
subsection 4.2) and (c) any outstanding Eurocurrency Loans that were to have
been converted on the first day of such Interest Period to or continued as
Eurocurrency Loans the rate of interest applicable to which is based upon the
Affected Eurocurrency Rate and that are not otherwise permitted to be converted
to or continued as ABR Loans by subsection 4.2 shall, upon demand by the
applicable Revolving Credit Lenders the Revolving Facility Commitment
Percentage of which aggregate greater than 50% of such Revolving Credit Loans
be immediately repaid by the applicable Borrower on the last day of the then
current Interest Period with respect thereto together with accrued interest
thereon or otherwise, at the option of the Parent Borrower, shall remain outstanding
and bear interest at a rate which reflects, as to each of the Revolving Credit
Lenders, such Revolving Credit Lender’s cost of funding such Eurocurrency Loans
as reasonably determined by such Revolving Credit Lender, plus the Applicable
Margin hereunder. If any such repayment occurs on a day which is not the last
day of the then current Interest Period with respect to such affected
Eurocurrency Loan, the applicable Borrower shall pay to each of the applicable
Revolving Credit Lenders such amounts, if any, as may be required pursuant to
subsection 4.12.  Until such notice has
been withdrawn by the Administrative Agent, no further Eurocurrency Loans the
rate of interest applicable to which is based upon the Affected Eurocurrency
Rate shall be made or continued as such, nor shall any of the Borrowers have
the right to convert ABR Loans to Eurocurrency Loans the rate of interest
applicable to which is based upon the Affected Eurocurrency Rate.

4.8           Pro
Rata Treatment and Payments. 
(a)  Each borrowing of Revolving
Credit Loans by any of the applicable Borrowers from the Lenders hereunder
shall be made, each payment by any of the Borrowers on account of any
commitment fee in respect of the Revolving Facility Commitments hereunder shall
be allocated by the Administrative Agent, and any reduction of the Revolving
Facility Commitments of the Lenders, as applicable, shall be allocated by the
Administrative Agent pro rata according to the Revolving Facility Commitment
Percentage, as applicable, of the applicable Lenders.  Each payment (including each prepayment) by
any of the applicable Borrowers on account of principal of and interest on any
Revolving Credit Loans, as applicable, shall be allocated by the Administrative
Agent pro rata according to the respective outstanding principal amounts of
such Revolving Credit Loans then held by the relevant Revolving Credit
Lenders.  Each payment (including each
prepayment) by the Parent Borrower on account of principal of and interest on any
Revolving Credit Loans, as applicable, shall be allocated by the Administrative
Agent to the outstanding principal amounts of such Revolving Credit Loans then
due and owing by Parent Borrower.  Each
payment (including each prepayment) by Puerto Ricancars on account of principal
of and interest on any Revolving Credit Loans, shall be allocated by the
Administrative Agent to the outstanding principal amounts of such Revolving
Credit Loans then due and owing by Puerto Ricancars.  All payments (including prepayments) to be
made by any of the Borrowers hereunder, whether on account of principal,
interest, fees, or otherwise, shall be made without set-off or counterclaim and
shall be made prior 

 

38

to 1:00 P.M., New York City time, on the due date thereof to
the Administrative Agent for the account of the Lenders holding the relevant
Loans at the Administrative Agent’s office specified in subsection 11.2, in
immediately available funds.  Payments
received by the Administrative Agent after such time shall be deemed to have
been received on the next Business Day. 
The Administrative Agent shall distribute such payments to such Lenders,
if any such payment is received prior to 1:00 P.M., New York City time, on a Business
Day, in like funds as received prior to the end of such Business Day and
otherwise the Administrative Agent shall distribute such payment to such
Lenders on the next succeeding Business Day. 
If any payment hereunder (other than payments on the Eurocurrency Loans)
becomes due and payable on a day other than a Business Day, the maturity of
such payment shall be extended to the next succeeding Business Day, and, with
respect to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension. 
If any payment on a Eurocurrency Loan becomes due and payable on a day
other than a Business Day, the maturity of such payment shall be extended to
the next succeeding Business Day (and, with respect to payments of principal,
interest thereon shall be payable at the then applicable rate during such
extension) 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.

(b)           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 such Agent, such Agent may
assume that such Lender is making such amount available to such Agent, and such
Agent may, in reliance upon such assumption, make available to the applicable
Borrowers in respect of such borrowing 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 equal to the daily average Federal Funds Effective
Rate 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 subsection shall be conclusive in the absence of
manifest error.  If such Lender’s share
of such borrowing is not made available to the applicable Agent by such Lender
within three Business Days of such Borrowing Date, (x) the applicable Agent
shall notify the Parent Borrower of the failure of such Lender to make such
amount available to the Administrative Agent and such Agent shall also be
entitled to recover such amount with interest thereon at the rate per annum
applicable to ABR Loans hereunder, in either case on demand, from such Borrower
and (y) then such Borrower may, without waiving or limiting any rights or
remedies it may have against such Lender hereunder or under applicable law or
otherwise, (i) borrow a like amount on an unsecured basis from any commercial
bank for a period ending on the date upon which such Lender does in fact make such
borrowing available, provided that at the time such borrowing is made
and at all times while such amount is outstanding such Borrower would be
permitted to borrow such amount pursuant to subsection 2.1 and/or (ii) take any
action permitted by the following subsection 4.8(c).

(c)           Notwithstanding
anything contained in this Agreement:

(i)            If
at any time a Revolving Credit Lender shall not make a Revolving Credit Loan
required to be made by it hereunder (any such Lender, a “Defaulting Lender”),
the Parent Borrower shall have the right to seek one or 

 

39

 

more Persons reasonably satisfactory to the
Administrative Agent and the Parent Borrower to each become a substitute
Revolving Credit Lender and assume all or part of the Revolving Facility
Commitment of such Defaulting Lender.  In
such event, the Parent Borrower, the Administrative Agent and any such
substitute Revolving Credit Lender shall execute and deliver, and such Defaulting
Lender shall thereupon be deemed to have executed and delivered, an
appropriately completed Assignment and Acceptance to effect such substitution.

(ii)           In determining the Required Lenders, any Lender that at
the time is a Defaulting Lender (and the Revolving Credit Loans and/or Revolving
Facility Commitment of such Defaulting Lender) shall be excluded and
disregarded.  No commitment fee shall
accrue for the account of a Defaulting Lender so long as such Lender shall be a
Defaulting Lender.

(iii)          If at any time any Borrower shall be required to make any
payment under any Loan Document to or for the account of a Defaulting Lender,
then such Borrower, so long as it is then permitted to borrow Revolving Credit
Loans hereunder, may set off and otherwise apply its obligation to make such
payment against the obligation of such Defaulting Lender to make such defaulted
Loan.  In such event, the amount so set
off and otherwise applied shall be deemed to constitute a Revolving Credit Loan
by such Defaulting Lender made on the date of such set-off and included within
any borrowing of Revolving Credit Loans as the Administrative Agent may
reasonably determine.

(iv)          If, with respect to any Defaulting Lender, which for the
purposes of this subsection 4.8(c)(iv), shall include any Revolving Credit
Lender that has taken any action or become the subject of any action or
proceeding of a type described in subsection 9(f), any Borrower shall be
required to pay any amount under any Loan Document to or for the account of
such Defaulting Lender, then such Borrower, so long as it is then permitted to
borrow Revolving Credit Loans hereunder, may satisfy such payment obligation by
paying such amount to the Administrative Agent to be (to the extent permitted
by applicable law and to the extent not utilized by the Administrative Agent to
satisfy obligations of the Defaulting Lender owing to it) held by the
Administrative Agent in escrow pursuant to its standard terms (including as to
the earning of interest), and applied (together with any accrued interest) by
it from time to time to make any Revolving Credit Loans or other payments as
and when required to be made by such Defaulting Lender hereunder.

4.9           Illegality.  Notwithstanding any other provision herein,
if the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof occurring after the Closing Date shall
make it unlawful for any Lender to make or maintain any Eurocurrency Loans as
contemplated by this Agreement (“Affected Loans”), (a) such Lender shall
promptly give written notice of such circumstances to the Parent Borrower and
the Administrative Agent (which notice shall be withdrawn whenever such
circumstances no longer exist), (b) the commitment of such Lender hereunder to
make Affected Loans, continue Affected Loans as such and convert an ABR Loan to
an Affected Loan shall forthwith be cancelled and, 

 

40

 

until such time as it shall no longer be unlawful for such
Lender to make or maintain such Affected Loans, such Lender shall then have a
commitment only to make an ABR Loan when an Affected Loan is requested (to the
extent otherwise permitted by subsection 4.2), (c) such Lender’s Loans then
outstanding as Affected Loans, if any, shall be converted automatically to ABR
Loans on the respective last days of the then current Interest Periods with
respect to such Loans or within such earlier period as required by law (to the
extent otherwise permitted by subsection 4.2) and (d) such Lender’s Loans
then outstanding as Affected Loans, if any, not otherwise permitted to be
converted to ABR Loans by subsection 4.2 shall, upon notice to the Parent
Borrower, be prepaid with accrued interest thereon on the last day of the then
current Interest Period with respect thereto (or such earlier date as may be
required by any such Requirement of Law). 
If any such conversion or prepayment of an Affected Loan occurs on a day
which is not the last day of the then current Interest Period with respect
thereto, the applicable Borrower shall pay to such Lender such amounts, if any,
as may be required pursuant to subsection 4.12.

4.10         Requirements
of Law.  (a)  If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof applicable
to any Lender, 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, in each case made subsequent to the Closing Date (or,
if later, the date on which such Lender becomes a Lender):

(i)            shall
subject such Lender to any tax of any kind whatsoever with respect to any
Eurocurrency Loans made or maintained by it or its obligation to make or
maintain Eurocurrency Loans, or change the basis of taxation of payments to
such Lender in respect thereof, in each case, except for Non-Excluded Taxes and
taxes measured by or imposed upon the overall net income, or franchise taxes,
or taxes measured by or imposed upon overall capital or net worth, or branch
taxes (in the case of such capital, net worth or branch taxes, imposed in lieu
of such net income tax), of such Lender or its applicable lending office,
branch, or any affiliate thereof;

(ii)           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 which is not otherwise included in the determination of the
Eurocurrency Rate, hereunder; or

(iii)          shall impose on such Lender any other condition (excluding
any tax of any kind whatsoever);

and the result of any of
the foregoing is to increase the cost to such Lender, by an amount which such
Lender deems to be material, of making, converting into, continuing or
maintaining Eurocurrency Loans or to reduce any amount receivable hereunder in
respect thereof, then, in any such case, upon notice to the Parent Borrower
from such Lender, through the Administrative Agent, in accordance herewith, the
applicable Borrower shall promptly pay such Lender, upon its demand, any
additional amounts necessary to compensate such Lender for such increased cost
or 

 

41

 

reduced amount receivable
with respect to such Eurocurrency Loans, provided that, in any such
case, such Borrower may elect to convert the Eurocurrency Loans made by such
Lender hereunder to ABR Loans (in compliance with subsection 4.2) by giving the
Administrative Agent at least one Business Day’s notice of such election, in
which case such Borrower shall promptly pay to such Lender, upon demand,
without duplication, amounts theretofore required to be paid to such Lender
pursuant to this subsection 4.10(a) and such amounts, if any, as may be
required pursuant to subsection 4.12.  If
any Lender becomes entitled to claim any additional amounts pursuant to this
subsection, it shall provide prompt notice thereof to the Parent Borrower, through
the Administrative Agent, certifying (x) that one of the events described in
this paragraph (a) has occurred and describing in reasonable detail the nature
of such event, (y) as to the increased cost or reduced amount resulting from
such event and (z) as to the additional amount demanded by such Lender and a
reasonably detailed explanation of the calculation thereof.  Such a certificate as to any additional
amounts payable pursuant to this subsection submitted by such Lender, through
the Administrative Agent, to the Parent Borrower 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.

(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, in each case,
made subsequent to the Closing Date, does or shall have the effect of reducing
the rate of return on such Lender’s or such corporation’s capital as a
consequence of such Lender’s obligations hereunder to a level below that which
such Lender or such corporation could have achieved but for such 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, within ten Business Days after
submission by such Lender to the Parent Borrower (with a copy to the
Administrative Agent) of a written request therefor certifying (x) that
one of the events described in this paragraph (b) has occurred and describing
in reasonable detail the nature of such event, (y) as to the reduction of the
rate of return on capital resulting from such event and (z) as to the
additional amount or amounts demanded by such Lender or corporation and a
reasonably detailed explanation of the calculation thereof, the applicable
Borrower shall pay to such Lender such additional amount or amounts as will
compensate such Lender or corporation for such reduction.  Such a certificate as to any additional amounts
payable pursuant to this subsection submitted by such Lender, through the
Administrative Agent, to the Parent Borrower 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.

(c)           Notwithstanding
anything to the contrary this subsection 4.10, no Borrower shall be required to
pay any amount with respect to any additional cost or reduction specified in
paragraph (a) or paragraph (b) above, to the extent such additional cost or
reduction is attributable, directly or indirectly, to the application of,
compliance with or implementation of specific capital adequacy requirements or
new methods of calculating capital adequacy, including any part or “pillar”
(including Pillar 2 (“Supervisory Review Process”)), of the International
Convergence of Capital Measurement Standards: a Revised Framework, published by
the Basel Committee on Banking Supervision in June 2004, or any implementation,
adoption 

 

42

(whether voluntary or compulsory) thereof, whether by an EC
Directive or the FSA Integrated Prudential Sourcebook or any other law or
regulation, or otherwise.

4.11         Taxes.  (a) 
Except as provided below in this subsection or as required by law, all
payments made by each of the Borrowers and the Agents under this Agreement and
any Notes 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 (“Taxes”), excluding Taxes measured by or imposed upon the
overall net income of any Agent or Lender or its applicable lending office, or
any branch or affiliate thereof, and all franchise Taxes, branch Taxes, Taxes
on doing business or Taxes measured by or imposed upon the overall capital or
net worth of any such Agent or Lender or its applicable lending office, or any
branch or affiliate thereof, in each case imposed:  (i) by the
jurisdiction under the laws of which such Agent or Lender, applicable lending
office, branch or affiliate is organized or is located, or in which its
principal executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii) by
reason of any connection between the jurisdiction imposing such Tax and such
Agent or Lender, applicable lending office, branch or affiliate other than a
connection arising solely from such Agent or Lender having executed, delivered
or performed its obligations under, or received payment under or enforced, this
Agreement or any Notes.  If any such
non-excluded Taxes (“Non-Excluded Taxes”) are required to be withheld
from any amounts payable by any Borrower or any Agent to the Administrative
Agent or any Lender hereunder or under any Notes, the amounts payable by such
Borrower shall be increased to the extent necessary to yield to the
Administrative Agent or such Lender (after payment of all Non-Excluded Taxes)
interest or any such other amounts payable hereunder at the rates or in the
amounts specified in this Agreement; provided, however, that each
of the Borrowers shall be entitled to deduct and withhold, and the Borrowers
shall not be required to indemnify for, any Non-Excluded Taxes, and any such
amounts payable  by any Borrower or any
Agent to, or for the account of, any such Agent or Lender shall not be
increased (x) if such Agent or Lender fails to comply with the requirements of
paragraphs (b) or (c) of this subsection or (y) with respect to any
Non-Excluded Taxes imposed in connection with the payment of any fees paid
under this Agreement unless such Non-Excluded Taxes are imposed as a result of
a change in treaty, law or regulation that occurred after such Agent becomes an
Agent hereunder or such Lender becomes a Lender hereunder (or, if such Agent or
Lender is a non-U.S. intermediary or flow-through entity for U.S. federal
income tax purposes, after the relevant beneficiary or member of such Agent or
Lender became such a beneficiary or member, if later) (such change, at such
time, a “Change in Law”) or (z) with respect to any Non-Excluded Taxes imposed
by the United States or any state or political subdivision thereof, unless such
Non-Excluded Taxes are imposed as a result of a Change in Law.  Whenever any Non-Excluded Taxes are payable
by any of the Borrowers, as promptly as possible thereafter the applicable
Borrower shall send to the Administrative Agent for its own account or for the
account of such Lender, as the case may be, a certified copy of an original
official receipt received by such Borrower showing payment thereof.  If any of the Borrowers fails to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or fails to
remit to the Administrative Agent the required receipts or other required
documentary evidence, such 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

 

43

as a result of any such failure.  The agreements in this subsection 4.11 shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.

(b)           Each
Agent and each Lender that stands ready to make, makes or holds any Extension
of Credit to any Borrower (a “U.S. Extender of Credit”), in each case
that is not incorporated under the laws of the United States of America or a
state thereof shall:

                (X)

(i)            on
or before the date of any payment by any of the Borrowers under this Agreement
or any Notes to, or for the account of, such Agent or Lender, deliver to the
Parent Borrower and the Administrative Agent (A) two duly completed copies
of United States Internal Revenue Service Form W-8BEN (certifying that it is a
resident of the applicable country within the meaning of the income tax treaty
between the United States and that country) or Form W-8ECI, or successor
applicable form, as the case may be, in each case certifying that it is
entitled to receive all payments under this Agreement and any Notes without
deduction or withholding of any United States federal income taxes, and (B)
such other forms, documentation or certifications, as the case may be,
certifying that it is entitled to an exemption from United States backup
withholding tax with respect to payments under this Agreement and any Notes;

(ii)           deliver to the Borrowers and the Administrative Agent two
further copies of any such form or certification on or before the date that any
such form or certification expires or becomes obsolete and after the occurrence
of any event requiring a change in the most recent form or certificate
previously delivered by it to the Borrowers; and

(iii)          obtain such extensions of time for filing and completing
such forms or certifications as may reasonably be requested by any Borrower or
the Administrative Agent; or

(Y)           in
the case of any such Lender that is not a “bank” within the meaning of Section
881(c)(3)(A) of the Code and is claiming the so-called “portfolio interest
exemption”,

(i)            represent
to the Borrowers and the Administrative Agent that it is not a bank within the
meaning of Section 881(c)(3)(A) of the Code;

(ii)           deliver to the Borrowers on or before the date of any
payment by any of the Borrowers, with a copy to the Administrative Agent,
(A) two certificates substantially in the form of Exhibit E (any such
certificate a “U.S. Tax Compliance Certificate”) and (B) two accurate
and complete original signed copies of Internal Revenue Service Form W-8BEN, or
successor applicable form, certifying to such Lender’s legal entitlement at the
date of such form to an exemption from U.S. withholding tax under the
provisions of Section 871(h) or

 

44

Section 881(c) of the Code with respect to payments to
be made under this Agreement and any Notes (and shall also deliver to the
Borrowers and the Administrative Agent two further copies of such form or
certificate on or before the date it expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recently provided form
or certificate and, if necessary, obtain any extensions of time reasonably
requested by any Borrower or the Administrative Agent for filing and completing
such forms or certificates); and

(iii)          deliver, to the extent legally entitled to do so, upon
reasonable request by any Borrower, to the Borrowers and the Administrative
Agent such other forms as may be reasonably required in order to establish the
legal entitlement of such Lender to an exemption from withholding with respect
to payments under this Agreement and any Notes, provided that in
determining the reasonableness of a request under this clause (ii) such Lender
shall be entitled to consider the cost (to the extent unreimbursed by any of
the Borrowers) which would be imposed on such Lender of complying with such
request; or

(Z)           in
the case of any such Lender that is a non-U.S. intermediary or flow-through
entity for U.S. federal income tax purposes,

(i)            on
or before the date of any payment by any of the Borrowers under this Agreement
or any Notes to, or for the account of, such Lender, deliver to the Borrowers
and the Administrative Agent two accurate and complete original signed copies
of Internal Revenue Service Form W-8IMY and, if any beneficiary or member of
such Lender is claiming the so-called “portfolio interest exemption”, (I)
represent to the Borrowers and the Administrative Agent that such Lender is not
a bank within the meaning of Section 881(c)(3)(A) of the Code, and (II) also
deliver to the Borrowers and the Administrative Agent two U.S. Tax Compliance
Certificates certifying to such Lender’s legal entitlement at the date of such
certificate to an exemption from U.S. Withholding tax under the provisions of
Section 881(c) of the Code with respect to payments to be made under this
Agreement and any Notes; and

(A)                              with respect to each beneficiary or member of such Lender
that is not claiming the so-called “portfolio interest exemption”, also deliver
to the Borrower and the Administrative Agent (I) two duly completed copies of
Internal Revenue Service Form W-8BEN (certifying that such beneficiary or
member is a resident of the applicable country within the meaning of the income
tax treaty between the United States and that country), Form W-8ECI or Form
W-9, or successor applicable form, as the case may be, in each case so that
each such beneficiary or member is entitled to receive all payments under this
Agreement and any Notes without deduction or withholding of any United States
federal income taxes and (II) such other forms, documentation or
certifications, as the case may be, certifying that each such beneficiary or
member is 

 

45

 

entitled to an exemption from United States backup
withholding tax with respect to all payments under this Agreement and any
Notes; and

(B)                                with respect to each beneficiary or member of such Lender
that is claiming the so-called “portfolio interest exemption”, (I) represent to
the Borrowers and the Administrative Agent that such beneficiary or member is
not a bank within the meaning of Section 881(c)(3)(A) of the Code, and (II)
also deliver to the Borrowers and the Administrative Agent two U.S. Tax
Compliance Certificates from each beneficiary or member and two accurate and
complete original signed copies of Internal Revenue Service Form W-8BEN, or
successor applicable form, certifying to such beneficiary’s or member’s legal
entitlement at the date of such certificate to an exemption from U.S.
withholding tax under the provisions of Section 871(h) or Section 881(c) of the
Code with respect to payments to be made under this Agreement and any Notes;

(ii)           deliver to the Borrowers and the Administrative Agent two
further copies of any such forms, certificates or certifications referred to
above on or before the date any such form, certificate or certification expires
or becomes obsolete, or any beneficiary or member changes, and after the
occurrence of any event requiring a change in the most recently provided form,
certificate or certification and obtain such extensions of time reasonably
requested by the Parent Borrower or the Administrative Agent for filing and
completing such forms, certificates or certifications; and

(iii)          deliver, to the extent legally entitled to do so, upon
reasonable request by any Borrower, to the Borrowers and the Administrative
Agent such other forms as may be reasonably required in order to establish the
legal entitlement of such Lender (or beneficiary or member) to an exemption
from withholding with respect to payments under this Agreement and any Notes, provided
that in determining the reasonableness of a request under this clause (iii)
such Lender shall be entitled to consider the cost (to the extent unreimbursed
by any of the Borrowers) which would be imposed on such Lender (or beneficiary
or member) of complying with such request;

unless in any such case
any change in treaty, law or regulation has occurred after the date such Person
becomes a Lender hereunder (or a beneficiary or member in the circumstances
described in clause (Z) above, if later) which renders all such forms
inapplicable or which would prevent such Lender (or such beneficiary or member)
from duly completing and delivering any such form with respect to it and such
Lender so advises the Parent Borrower and the Administrative Agent.

(c)           Each
Agent and each U.S. Extender of Credit, in each case that is organized under
the laws of the United States of America or a state thereof, shall on or before
the 

 

46

date of any payment by any of the Borrowers under this
Agreement or any Notes to, or for the account of, such Agent or U.S. Extender
of Credit, deliver to the Borrowers and the Administrative Agent two duly
completed copies of Internal Revenue Service Form W-9, or successor form,
certifying that such Agent or U.S. Extender of Credit is a United States Person
(within the meaning of Section 7701(a)(30) of the Internal Revenue Code) and
that such Agent or U.S. Extender of Credit is entitled to a complete exemption
from United States backup withholding tax.

4.12         Indemnity.  Each Borrower agrees to indemnify each Lender
in respect of Extensions of Credit made, or requested to be made, to the
Borrowers, and to hold each such Lender harmless from any loss or expense which
such Lender may sustain or incur (other than through such Lender’s gross
negligence or willful misconduct) as a consequence of (a) default by such
Borrower in making a borrowing of, conversion into or continuation of
Eurocurrency Loans after the Parent Borrower has given a notice requesting the
same in accordance with the provisions of this Agreement, (b) default by such
Borrower in making any prepayment or conversion of Eurocurrency Loans after the
Parent Borrower has given a notice thereof in accordance with the provisions of
this Agreement or (c) the making of a payment or prepayment of Eurocurrency
Loans or the conversion of Eurocurrency Loans on a day which is not the last
day of an Interest Period with respect thereto. 
Such indemnification may include an amount equal to the excess, if any,
of (i) the amount of interest which would have accrued on the amount so
prepaid, or converted, or not so borrowed, converted or continued, for the
period from the date of such prepayment or conversion or of such failure to
borrow, convert or continue to the last day of the applicable 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 Eurocurrency 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) which 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.  If any Lender becomes entitled
to claim any amounts under the indemnity contained in this subsection 4.12, it
shall provide prompt notice thereof to the Parent Borrower, through the
Administrative Agent, certifying (x) that one of the events described in clause
(a), (b) or (c) has occurred and describing in reasonable detail the nature of
such event, (y) as to the loss or expense sustained or incurred by such Lender
as a consequence thereof and (z) as to the amount for which such Lender seeks
indemnification hereunder and a reasonably detailed explanation of the
calculation thereof.  Such a certificate
as to any indemnification pursuant to this subsection submitted by such Lender,
through the Administrative Agent, to the Parent Borrower 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.

4.13         Certain
Rules Relating to the Payment of Additional Amounts.  (a) 
Upon the request, and at the expense of the applicable Borrower, each
Lender to which any of the Borrowers is required to pay any additional amount
pursuant to subsection 4.10 or 4.11, and any Participant in respect of whose
participation such payment is required, shall reasonably afford such Borrower
the opportunity to contest, and reasonably cooperate with such Borrower in
contesting, the imposition of any Non-Excluded Tax giving rise to such payment;
provided that (i) such Lender shall not be required to afford such
Borrower the opportunity to so contest unless 

 

47

such Borrower shall have confirmed in writing to such Lender
its obligation to pay such amounts pursuant to this Agreement and (ii) such
Borrower shall reimburse such Lender for its reasonable attorneys’ and accountants’
fees and out-of-pocket disbursements incurred in so cooperating with such
Borrower in contesting the imposition of such Non-Excluded Tax; provided,
however, that notwithstanding the foregoing no Lender shall be required
to afford any Borrower the opportunity to contest, or cooperate with such
Borrower in contesting, the imposition of any Non-Excluded Taxes, if such
Lender in its sole discretion in good faith determines that to do so would have
an adverse effect on it.

(b)           If
a Lender changes its applicable lending office (other than (i) pursuant to
paragraph (c) below or (ii) after an Event of Default under subsection 9(a) or
(f) has occurred and is continuing) and the effect of such change, as of the
date of such change, would be to cause any of the Borrowers to become obligated
to pay any additional amount under subsection 4.10 or 4.11, such Borrower shall
not be obligated to pay such additional amount.

(c)           If
a condition or an event occurs which would, or would upon the passage of time
or giving of notice, result in the payment of any additional amount to any
Lender by any of the Borrowers pursuant to subsection 4.10 or 4.11, such Lender
shall promptly notify the applicable Borrower and the Administrative Agent and
shall take such steps as may reasonably be available to it to mitigate the
effects of such condition or event (which shall include efforts to rebook the
Loans held by such Lender at another lending office, or through another branch
or an Affiliate, of such Lender); provided that such Lender shall not be
required to take any step that, in its reasonable judgment, would be materially
disadvantageous to its business or operations or would require it to incur
additional costs (unless the Parent Borrower agrees to reimburse such Lender
for the reasonable incremental out-of-pocket costs thereof).

(d)           If
any of the Borrowers shall become obligated to pay additional amounts pursuant
to subsection 4.10 or 4.11 and any affected Lender shall not have promptly
taken steps necessary to avoid the need for payments under subsection 4.10 or
4.11 or if no such steps are possible, the applicable Borrower shall have the
right, for so long as such obligation remains, (i) with the assistance of the
Administrative Agent, to seek one or more substitute Lenders reasonably
satisfactory to the Administrative Agent and such Borrower to purchase the
affected Loan, in whole or in part, at an aggregate price no less than such
Loan’s principal amount plus accrued interest, and assume the affected
obligations under this Agreement, or (ii) so long as no Default or Event of
Default then exists or will exist immediately after giving effect to the
respective prepayment, upon at least four Business Days’ irrevocable notice to
the Administrative Agent, to prepay the affected Loan, in whole or in part,
subject to subsection 4.12, without premium or penalty.  In the case of the substitution of a Lender,
the Parent Borrower (and any other applicable Borrower), the Administrative
Agent, the affected Lender, and any substitute Lender shall execute and deliver
an appropriately completed Assignment and Acceptance pursuant to subsection
11.6(b) to effect the assignment of rights to, and the assumption of
obligations by, the substitute Lender; provided that any fees required
to be paid by subsection 11.6(b) in connection with such assignment shall be
paid by the Parent Borrower or the substitute Lender.  In the case of a prepayment of an affected
Loan, the amount specified in the notice shall be due and payable on the date
specified therein, together with any accrued interest to such date on the
amount prepaid.  In the case of each of
the substitution of a Lender and of the prepayment of an affected Loan, the
applicable Borrower shall first pay the affected

 

48

 

Lender any additional amounts owing under subsections 4.10
and 4.11 (as well as any commitment fees and other amounts then due and owing
to such Lender, including any amounts under this subsection 4.13) prior to such
substitution or prepayment.

(e)           If
any Agent or any Lender receives a refund directly attributable to taxes for
which any of the Borrowers has made additional payments pursuant to subsection
4.10(a) or 4.11(a), such Agent or such Lender, as the case may be, shall
promptly pay such refund (together with any interest with respect thereto
received from the relevant taxing authority, but net of any reasonable cost
incurred in connection therewith) to such Borrower; provided, however,
that such Borrower agrees promptly to return such refund (together with any
interest with respect thereto due to the relevant taxing authority) (free of
all Non-Excluded Taxes) to such Agent or the applicable Lender, as the case may
be, upon receipt of a notice that such refund is required to be repaid to the
relevant taxing authority.

(f)            The
obligations of any Agent, Lender or Participant under this subsection 4.13
shall survive the termination of this Agreement and the payment of the Loans
and all amounts payable hereunder.

4.14         Controls
on Prepayment if Aggregate Lender Exposure Exceeds Aggregate Revolving Facility
Commitments.  (a)  In addition to the provisions set forth in
subsection 4.4(b), the Parent Borrower and Puerto Ricancars will implement and
maintain internal controls to monitor the borrowings and repayments of Loans by
the Borrowers, with the object of preventing any request for an Extension of
Credit that would result in (i) the Aggregate Lender Exposure outstanding to
both Borrowers being in excess of the aggregate Revolving Facility Commitments
then in effect or (ii) any other circumstance under which an Extension of
Credit would not be permitted pursuant to subsection 2.1(a) and (b).

(b)           The
Administrative Agent will calculate the Aggregate Lender Exposure outstanding
to both Borrowers, from time to time, and in any event not less frequently than
once during each calendar week.

4.15         Reserved.

4.16         Cash
Management System.

(a)           Within
120 days following the Closing Date, Borrowers will establish and maintain
until the Termination Date, the cash management system described in Exhibit
C with such changes as may be mutually agreed (the “Cash Management
System”).  Without limiting the
generality of the foregoing, within 120 days following the Closing Date, the
Borrowers shall deliver to the Administrative Agent, executed amendments to the
Master Exchange Agreement and Escrow Agreement referenced in Exhibit C, amendments
to such other agreements entered into in connection the LKE Program (including,
without limitation, the Amended and Restated Administration Agreement) and such
other amendments, agreements, instruments and documents as shall be necessary
to establish the Cash Management System, all such amendments and other
agreements, instruments and documents to be in form and substance reasonably
satisfactory to the Required Lenders.

 

49

 

(b)           Until
such time as the Parent Borrower shall have complied with the provisions of
subsection 4.16(a) as it relates to Part I of Exhibit C, no amounts shall be
included in the Domestic Borrowing Base pursuant to clause (d) of the
definition of “Domestic Borrowing Base”.

(c)           Until
such time as the Parent Borrower shall have complied with the provisions of
subsection 4.16(a) as it relates to Part I of Exhibit C, (i) the Parent
Borrower shall cause all proceeds from the disposition of Facility Assets to be
transferred to the Hertz Collateral Account (as such term is defined in Exhibit
C) or to another account acceptable to the Administrative Agent, as promptly as
practicable, but in any event within seven (7) Business Days, after such
proceeds were deposited into the Joint Collection Account and (ii) the Parent
Borrower shall promptly provide the Administrative Agent with such reporting
and other information as the Administrative Agent shall reasonably request in
order to permit the Administrative Agent to monitor the requirements set forth
in clause (i) of this subsection 4.16(c).

SECTION 5.  REPRESENTATIONS
AND WARRANTIES.  To induce the
Administrative Agent and each Lender to make the Extensions of Credit requested
to be made by it on the Closing Date and on each Borrowing Date thereafter,
each of the Parent Borrower and Puerto Ricancars, in each case with respect
only to itself and its Subsidiaries, hereby represents and warrants, on the
Closing Date, in each case after giving effect to the Loans, and on every
Borrowing Date thereafter to the Administrative Agent and each Lender that:

5.1           Financial
Condition.  (a)  The audited consolidated balance sheets of
the Parent Borrower and its consolidated Subsidiaries as of December 31, 2003,
December 31, 2004 and December 31, 2005 and the related consolidated statements
of operations, stockholder’s equity and cash flows for the fiscal years ended
on such dates, reported on by and accompanied by unqualified reports from
PricewaterhouseCoopers LLP, and the unaudited consolidated balance sheets of
the Parent Borrower and its consolidated Subsidiaries as of June 30, 2006 and
the related consolidated statements of operations and cash flows for the period
ended on such date, present fairly, in all material respects, the consolidated
financial condition as at such date, and the consolidated results of operations
and consolidated cash flows for the respective fiscal years or periods then
ended, of the Parent Borrower and its consolidated Subsidiaries.  All such financial statements, including the
related schedules and notes thereto, have been prepared in accordance with GAAP
consistently applied throughout the periods covered thereby (except as approved
by a Responsible Officer, and disclosed in any such schedules and notes, and
subject to the omission of footnotes from such unaudited financial
statements).  During the period from
December 31, 2005 to and including the Closing Date, there has been
no sale, transfer or other disposition by the Parent Borrower and its
consolidated Subsidiaries of any material part of the business or property of
the Parent Borrower and its consolidated Subsidiaries, taken as a whole, and no
purchase or other acquisition by any of them of any business or property
(including any Capital Stock of any other Person) material in relation to the
consolidated financial condition of the Parent Borrower and its consolidated
Subsidiaries, taken as a whole, in each case, which is not reflected in the
foregoing financial statements or in the notes thereto and has not otherwise
been disclosed in writing to the Lenders on or prior to the Closing Date.

 

50

 

(b)           The
audited consolidated balance sheets of Puerto Ricancars as of December 31, 2003
and December 31, 2004 and the related consolidated statements of income and
retained earnings and cash flows for the fiscal years ended on such dates,
reported on by and accompanied by unqualified reports from
PricewaterhouseCoopers LLP, and the unaudited consolidated balance sheet of
Puerto Ricancars as of June 30, 2006 and the related consolidated statements of
income and retained earnings and cash flows for the period ended on such date,
present fairly, in all material respects, the consolidated financial condition
as at such date, and the consolidated results of operations and consolidated
cash flows for the respective fiscal years or periods then ended, of Puerto
Ricancars. All such financial statements, including the related schedules and
notes thereto, have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby (except as approved by a Responsible
Officer, and disclosed in any such schedules and notes, and subject to the
omission of footnotes from such unaudited financial statements).  During the period from
December 31, 2005 to and including the Closing Date, there has been
no sale, transfer or other disposition by Puerto Ricancars of any material part
of the business or property of Puerto Ricancars and no purchase or other
acquisition Puerto Ricancars of any business or property (including any Capital
Stock of any other Person) material in relation to the consolidated financial
condition of Puerto Ricancars which is not reflected in the foregoing financial
statements or in the notes thereto and has not otherwise been disclosed in
writing to the Lenders on or prior to the Closing Date.

5.2           No
Change; Solvent.  Since December 31,
2005, except as and to the extent disclosed on Schedule 5.2, (a) there has been
no development or event relating to or affecting any Loan Party which has had
or would be reasonably expected to have a Material Adverse Effect (after giving
effect to (i) the making of the Extensions of Credit to be made on the Closing
Date and the application of the proceeds thereof as contemplated hereby, and
(ii) the payment of actual or estimated fees, expenses, financing costs
and tax payments related to the transactions contemplated hereby) and (b)
except to the extent disclosed on Schedule 5.2 or as otherwise permitted under
this Agreement and each other Loan Document, no dividends or other
distributions have been declared, paid or made upon the Capital Stock of the
Parent Borrower or Puerto Ricancars, nor has any of the Capital Stock of the
Parent Borrower or Puerto Ricancars been redeemed, retired, purchased or
otherwise acquired for value by the Parent Borrower or Puerto Ricancars or any
of their Subsidiaries.  As of the Closing
Date, after giving effect to the consummation of the transactions described in
preceding clauses (i) through (ii) in clause (a) above, each Borrower is
Solvent.

5.3           Corporate
Existence; Compliance with Law.  Each
of the Loan Parties (a) is duly organized, validly existing and (except
for Puerto Ricancars in the commonwealth of Puerto Rico, which shall be in good
standing in the commonwealth of Puerto Rico by no later than 45 days after the
Closing Date) in good standing under the laws of the jurisdiction of its
incorporation or formation, (b) has the corporate 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
to the extent that the failure to have such legal right would not be reasonably
expected to have a Material Adverse Effect, (c) is duly qualified as a foreign
corporation or limited liability company and in good standing under the laws of
each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, other than in such
jurisdictions where the failure to be so qualified and in good standing would
not be reasonably expected to have a Material Adverse Effect and (d) is in 

 

51

 

compliance with all Requirements of Law, except to the extent
that the failure to comply therewith would not, in the aggregate, be reasonably
expected to have a Material Adverse Effect.

5.4           Corporate
Power; Authorization; Enforceable Obligations.  Each Loan Party has the corporate 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 each of the Borrowers, to obtain
Extensions of Credit hereunder, and each such Loan Party has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Loan Documents to which it is a party and, in the case of each of the
Borrowers, to authorize the Extensions of Credit to it, if any, on the terms
and conditions of this Agreement and any Notes. 
No consent or authorization of, filing with, notice to or other similar
act by or in respect of, any Governmental Authority or any other Person is
required to be obtained or made by or on behalf of any Loan Party in connection
with the execution, delivery, performance, validity or enforceability of the
Loan Documents to which it is a party or, in the case of each of the Borrowers,
with the Extensions of Credit to it, if any, hereunder, except for (a)
consents, authorizations, notices and filings described in Schedule 5.4, all of
which have been obtained or made prior to the Closing Date, (b) filings to
perfect the Liens created by the Security Documents, (c) filings pursuant to
the Assignment of Claims Act of 1940, as amended (31 U.S.C. § 3727 et seq.), in
respect of Accounts of the Parent Borrower, Puerto Ricancars and their
Subsidiaries the Obligor in respect of which is the United States of America or
any department, agency or instrumentality thereof and (d) consents,
authorizations, notices and filings which the failure to obtain or make would
not reasonably be expected to have a Material Adverse Effect.  This Agreement has been duly executed and
delivered by each of the Borrowers, and each other Loan Document to which any
Loan Party is a party will be duly executed and delivered on behalf of such
Loan Party.  This Agreement constitutes a
legal, valid and binding obligation of each of the Borrowers and each other
Loan Document to which any Loan Party is a party when executed and delivered
will constitute a legal, valid and binding obligation of such Loan Party,
enforceable against such Loan Party in accordance with its terms, except as
enforceability may be limited by applicable domestic or foreign 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).

5.5           No
Legal Bar.  The execution, delivery
and performance of the Loan Documents by any of the Loan Parties, the
Extensions of Credit hereunder and the use of the proceeds thereof (a) will not
violate any Requirement of Law or Contractual Obligation of such Loan Party in
any respect that would reasonably be expected to have a Material Adverse Effect
and (b) will not result in, or require, the creation or imposition of any Lien
(other than the Liens permitted by subsection 8.1) on any of its properties or
revenues pursuant to any such Requirement of Law or Contractual Obligation.

5.6           No
Material Litigation.  No litigation,
investigation or proceeding of or before any arbitrator or Governmental
Authority is pending or, to the knowledge of the Parent Borrower or Puerto
Ricancars, threatened by or against Borrowers or any of their Subsidiaries or
against any of their respective properties or revenues, except as described on
Schedule 5.6, (a) which is so pending or threatened at any time on or prior to
the Closing Date and relates to any of the Loan Documents or any of the
transactions contemplated hereby or thereby or (b) which would be reasonably
expected to have a Material Adverse Effect.

 

52

 

5.7           No
Default.  None of the Parent
Borrower, Puerto Ricancars nor any of their Subsidiaries is in default under or
with respect to any of its Contractual Obligations in any respect which would
be reasonably expected to have a Material Adverse Effect.  No Default or Event of Default has occurred
and is continuing.

5.8           Ownership
of Property; Liens.  Each of the
Parent Borrower, Puerto Ricancars and their Subsidiaries has good title in fee
simple to, or a valid leasehold interest in, all its material real property, and
good title to, or a valid leasehold interest in, all its other material
property, and none of such property that consists of Facility Assets is subject
to any Lien, except for Liens permitted by subsection 8.1.

5.9           Intellectual
Property.  The Parent Borrower,
Puerto Ricancars and each of their Subsidiaries owns, or has the legal right to
use, all United States and foreign patents, patent applications, trademarks,
trademark applications, trade names, copyrights, technology, know-how and
processes necessary for each of them to conduct its business as currently
conducted (the “Intellectual Property”) except for those the failure to
own or have such legal right to use would not be reasonably expected to have a
Material Adverse Effect.  Except as
provided on Schedule 5.9, no claim has been asserted and is pending by any
Person challenging or questioning the use of any such Intellectual Property or
the validity or effectiveness of any such Intellectual Property, nor does the
Parent Borrower nor Puerto Ricancars know of any such claim, and, to the
knowledge of the Parent Borrower or Puerto Ricancars, the use of such
Intellectual Property by the Parent Borrower or Puerto Ricancars and their
Subsidiaries does not infringe on the rights of any Person, except for such claims
and infringements which in the aggregate, would not be reasonably expected to
have a Material Adverse Effect.

5.10         No
Burdensome Restrictions.  None of the
Parent Borrower, Puerto Ricancars nor any of their Subsidiaries is in violation
of any Requirement of Law or Contractual Obligation of or applicable to the
Parent Borrower or any of its Subsidiaries that would be reasonably expected to
have a Material Adverse Effect.

5.11         Taxes.  To the knowledge of the Parent Borrower and
Puerto Ricancars, each of CCMGC, the Parent Borrower, Puerto Ricancars and
their Subsidiaries has filed or caused to be filed all United States federal
income tax returns and all other material tax returns (other than the Annual
Report for the year ended December 31, 2005 to be filed in Puerto Rico) which
are required to be filed and has paid (a) all taxes shown to be due and payable
on such returns and (b) all taxes shown to be due and payable on any
assessments of which it has received notice 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 (i) taxes, fees or other
charges with respect to which the failure to pay, in the aggregate, would not
have a Material Adverse Effect or (ii) taxes, fees or other charges the amount
or validity of which are currently being contested in good faith by appropriate
proceedings diligently conducted and with respect to which reserves in
conformity with GAAP have been provided on the books of CCMGC, the Parent
Borrower, Puerto Ricancars or their Subsidiaries, as the case may be); and no
tax Lien has been filed, and no claim is being asserted, with respect to any
such tax, fee or other charge.

 

53

 

5.12         Federal
Regulations.  No part of the proceeds
of any Extensions of Credit will be used for any purpose which violates the
provisions of the Regulations of the Board, including without limitation,
Regulation T, Regulation U or Regulation X of the Board.  If requested by any Lender or the
Administrative Agent, the Parent Borrower and Puerto Ricancars 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, referred to in
said Regulation U.

5.13         ERISA.  (a) 
During the five year period prior to each date as of which this
representation is made, or deemed made, with respect to any Plan (or, with
respect to (f) or (h) below, as of the date such representation is made or
deemed made), none of the following events or conditions, either individually
or in the aggregate, has resulted or is reasonably likely to result in a
Material Adverse Effect: (a) a Reportable Event; (b) an “accumulated
funding deficiency” (within the meaning of Section 412 of the Code or Section
302 of ERISA); (c) any noncompliance with the applicable provisions of ERISA or
the Code; (d) a termination of a Single Employer Plan (other than a standard
termination pursuant to Section 4041(b) of ERISA); (e) a Lien on the property
of the Parent Borrower, Puerto Ricancars or their Subsidiaries in favor of the
PBGC or a Plan; (f) any Underfunding with respect to any Single Employer Plan;
(g) a complete or partial withdrawal from any Multiemployer Plan by the Parent
Borrower, Puerto Ricancars or any Commonly Controlled Entity; (h) any liability
of the Parent Borrower, Puerto Ricancars or any Commonly Controlled Entity
under ERISA if the Parent Borrower, Puerto Ricancars or any such Commonly Controlled
Entity were to withdraw completely from all Multiemployer Plans as of the
annual valuation date most closely preceding the date on which this
representation is made or deemed made; (i) the Reorganization or Insolvency of
any Multiemployer Plan; or (j) any transactions that resulted or could
reasonably be expected to result in any liability to the Parent Borrower,
Puerto Ricancars or any Commonly Controlled Entity under Section 4069 of ERISA
or Section 4212(c) of ERISA.

(b)           With
respect to any Foreign Plan, none of the following events or conditions exists
and is continuing that, either individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect: (a) substantial
non-compliance with its terms and with the requirements of any and all
applicable laws, statutes, rules, regulations and orders; (b) failure to be
maintained, where required, in good standing with applicable regulatory
authorities; (c) any obligation of the Parent Borrower, Puerto Ricancars or
their Subsidiaries in connection with the termination or partial termination
of, or withdrawal from, any Foreign Plan; (d) any Lien on the property of the
Parent Borrower, Puerto Ricancars or their Subsidiaries in favor of a
Governmental Authority as a result of any action or inaction regarding a
Foreign Plan; (e) for each Foreign Plan which is a funded or insured plan,
failure to be funded or insured on an ongoing basis to the extent required by
applicable non-U.S. law (using actuarial methods and assumptions which are consistent
with the valuations last filed with the applicable Governmental Authorities);
(f) any facts that, to the best knowledge of the Parent Borrower, Puerto
Ricancars or any of their Subsidiaries, exist that would reasonably be expected
to give rise to a dispute and any pending or threatened disputes that, to the
best knowledge of the Parent Borrower, Puerto Ricancars or any of their
Subsidiaries, would reasonably be expected to result in a material liability to
the Parent Borrower, Puerto Ricancars or any of their Subsidiaries concerning
the assets of any Foreign Plan (other than individual claims for the payment of
benefits); and (g) 

 

54

failure to make all contributions in a timely manner to the
extent required by applicable non-U.S. law.

5.14         Collateral.  (a) 
Upon execution and delivery thereof by the parties thereto, the Domestic
Guarantee and Collateral Agreement will be effective to create (to the extent
described therein) in favor of the Domestic Collateral Agent for the ratable
benefit of the Secured Parties, a legal, valid and enforceable security
interest in the Collateral described therein, except as may be limited by
applicable domestic or foreign bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors’ rights generally, general equitable principles (whether considered
in a proceeding in equity or at law) and an implied covenant of good faith and
fair dealing.  When (a) the actions
specified in Section 4 of the Domestic Guarantee and Collateral Agreement have
been duly taken, (b) all applicable Deposit Accounts (as defined in the
Domestic Guarantee and Collateral Agreement) a security interest in which is
required to be or is perfected by “control” (as described in the Uniform
Commercial Code as in effect in the State of New York from time to time) are
under the “control” of the Domestic Collateral Agent or the Administrative
Agent, as agent for the Domestic Collateral Agent and as directed by the
Domestic Collateral Agent, and (c) the Vehicle titles have been duly registered
showing the Lien of the Domestic Collateral Agent, the security interests
granted pursuant thereto shall constitute (to the extent described therein) a
perfected security interest in, all right, title and interest of each pledgor
(as applicable) party thereto in the Collateral described therein with respect
to such pledgor (as applicable).

(b)           Upon
execution and delivery thereof by the parties thereto, the PRUSVI Guarantee and
Collateral Agreement will be effective to create (to the extent described
therein) in favor of the PRUSVI Collateral Agent, for the ratable benefit of
the Secured Parties, a legal, valid and enforceable security interest in the
Collateral described therein, except as may be limited by applicable domestic
or foreign bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors’ rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.  When (a) the actions specified in
Section 4 of the PRUSVI Guarantee and Collateral Agreement have been duly
taken, (b) all applicable Deposit Accounts (as defined in the PRUSVI Guarantee
and Collateral Agreement) a security interest in which is required to be or is
perfected by “control” (as described in the Uniform Commercial Code as in
effect in the State of New York from time to time) are under the “control” of
the PRUSVI Collateral Agent or the Administrative Agent, as agent for the
PRUSVI Collateral Agent and as directed by the PRUSVI Collateral Agent, and (c)
the financing statement with respect to each Vehicle has been filed at the
Puerto Rico Department of Transportation and Public Works and Vehicle titles
have been duly registered showing the Lien of the PRUSVI Collateral Agent, the
security interests granted pursuant thereto shall constitute (to the extent
described therein) a perfected security interest in, all right, title and
interest of each pledgor (as applicable) party thereto in the Collateral
described therein with respect to such pledgor (as applicable).

5.15         Investment
Company Act; Other Regulations.  None
of the Borrowers is an “investment company”, or a company “controlled” by an “investment
company”, within the meaning of the Investment Company Act.  None of the Borrowers is subject to
regulation under

 

55

 

any Federal or State statute or regulation (other than
Regulation X of the Board) which limits its ability to incur Indebtedness as
contemplated hereby.

5.16         Subsidiaries.  Schedule 5.16 sets forth all the Subsidiaries
of Borrowers at the Closing Date, the jurisdiction of their incorporation and
the direct or indirect ownership interest of the Borrowers therein.

5.17         Purpose
of Loans.  The proceeds of Revolving
Credit Loans shall be used by the Borrowers for the acquisition, financing or
refinancing of Eligible Vehicles, to repay debt owing by the Parent Borrower
and intercompany debt owing by Puerto Ricancars to the Parent Borrower and for
general corporate purposes of the Parent Borrower and Puerto Ricancars.

5.18         Environmental
Matters.  Other than as disclosed on
Schedule 5.18 or exceptions to any of the following that would not,
individually or in the aggregate, reasonably be expected to give rise to a
Material Adverse Effect:

(a)           The
Borrowers and their Subsidiaries:  (i) are, and within the period of
all applicable statutes of limitation have been, in compliance with all
applicable Environmental Laws; (ii) hold all Environmental Permits (each of
which is in full force and effect) required for any of their current operations
or for any property owned, leased, or otherwise operated by any of them and
reasonably expect to timely obtain without material expense all such
Environmental Permits required for planned operations; (iii) are, and
within the period of all applicable statutes of limitation have been, in
compliance with all of their Environmental Permits; and (iv) believe they will
be able to maintain compliance with Environmental Laws, including any
reasonably foreseeable future requirements thereto.

(b)           Materials
of Environmental Concern have not been transported, disposed of, emitted,
discharged, or otherwise released or threatened to be released, to or at any
real property presently or formerly owned, leased or operated by the Borrowers
or any of their Subsidiaries or at any other location, which would reasonably
be expected to (i) give rise to liability or other Environmental Costs of
the Borrowers or any of their Subsidiaries under any applicable Environmental
Law, or (ii) interfere with any Borrower’s planned or continued operations.

(c)           There
is no judicial, administrative, or arbitral proceeding (including any notice of
violation or alleged violation) under any Environmental Law to which any
Borrower or any of their Subsidiaries is, or to the knowledge of the Borrowers
or any of their Subsidiaries is reasonably likely to be, named as a party that
is pending or, to the knowledge of any Borrower or any of their Subsidiaries,
threatened.

(d)           None
of the Borrowers nor any of their Subsidiaries has received any written request
for information, or been notified that it is a potentially responsible party,
under the federal Comprehensive Environmental Response,
Compensation, and Liability Act or any similar Environmental Law, or
received any other written request for information from any Governmental
Authority with respect to any Materials of Environmental Concern.

 

56

 

(e)           None
of the Borrowers nor any of their Subsidiaries has entered into or agreed to
any consent decree, order, or settlement or other agreement, nor is subject to
any judgment, decree, or order or other agreement, in any judicial,
administrative, arbitral, or other forum, relating to compliance with or
liability under any Environmental Law.

5.19         No
Material Misstatements.  The written
information, reports, financial statements, exhibits and schedules furnished by
or on behalf of the Borrowers to the Administrative Agent and the Lenders in
connection with the negotiation of any Loan Document or included therein or
delivered pursuant thereto, taken as a whole, did not contain as of the Closing
Date any material misstatement of fact and did not omit to state as of the
Closing Date any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not materially
misleading in their presentation of the Borrowers and their Subsidiaries taken
as a whole.  It is understood that (a) no
representation or warranty is made concerning the forecasts, estimates, pro
forma information, projections and statements as to anticipated future
performance or conditions, and the assumptions on which they were based,
contained in any such information, reports, financial statements, exhibits or
schedules, except that as of the date such forecasts, estimates, pro forma
information, projections and statements were generated, (i) such forecasts,
estimates, pro forma information, projections and statements were based on the
good faith assumptions of the management of the Borrowers and (ii) such
assumptions were believed by such management to be reasonable and (b) such
forecasts, estimates, pro forma information and statements, and the assumptions
on which they were based, may or may not prove to be correct.

5.20         Reserved.

5.21         Reserved.

5.22         Senior
Indebtedness.  The Loans and all
other obligations hereunder and under the other Loan Documents constitute “Senior
Indebtedness” and “Designated Senior Indebtedness” under and as defined in the
Senior Subordinated Notes Indenture (to the extent such obligations constitute “Indebtedness”
as defined in such document on the date hereof).  The obligations of each Guarantor under the
Domestic Guarantee and Collateral Agreement constitute “Guarantor Senior
Indebtedness” of such Guarantor under and as defined in the Senior Subordinated
Notes Indenture (to the extent such obligations constitute “Indebtedness” as
defined in such document on the date hereof).

5.23         Labor
Matters.  There are no strikes
pending or, to the knowledge of the Borrowers, reasonably expected to be
commenced against the Borrowers or any of their Subsidiaries which,
individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect.  The hours
worked and payments made to employees of the Borrowers and each of their
Subsidiaries have not been in violation of any applicable laws, rules or
regulations, except where such violations would not reasonably be expected to
have a Material Adverse Effect.

5.24         Reserved.

 

57

 

5.25         Insurance.  Schedule 5.25 sets forth a complete and
correct listing of all insurance that is (a) maintained by the Loan Parties and
(b) material to the business and operations of the Borrowers and their
Subsidiaries taken as a whole maintained by Subsidiaries other than Loan
Parties, in each case as of the Closing Date, with the amounts insured (and any
deductibles) set forth therein.

5.26         Eligible
Accounts.  As of the date of any
Borrowing Base Certificate, all Accounts included in the calculation of
Eligible Accounts on such Borrowing Base Certificate satisfy all requirements
of an “Eligible Account” hereunder.

5.27         Eligible
Vehicles.  As of the date of any
Borrowing Base Certificate, all Vehicles included in the calculation of
Eligible Vehicles on such Borrowing Base Certificate satisfy all requirements
of an “Eligible Vehicles” hereunder.

5.28         Anti-Terrorism.  As of the Closing Date, the Borrowers and
their Subsidiaries are in compliance with the Uniting and Strengthening of
America by Providing the Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001, except as would not reasonably be expected to have a
Material Adverse Effect.

SECTION 6.  CONDITIONS PRECEDENT.

6.1           Conditions
to Initial Extension of Credit.  This
Agreement, including the agreement of each Lender to make the initial Extension
of Credit requested to be made by it, shall become effective on the date on
which the following conditions precedent shall have been satisfied or waived:

(a)           Loan
Documents.  The Administrative Agent
shall have received the following Loan Documents, executed and delivered as
required below, with, in the case of clause (i), a copy for each Lender:

(i)            this
Agreement, executed and delivered by a duly authorized officer of each
Borrower;

(ii)           the Domestic Guarantee and Collateral Agreement, executed
and delivered by a duly authorized officer of the Parent Borrower and each
Domestic Subsidiary (other than (i) any Special Purpose Subsidiary, (ii) any
Subsidiary of a Foreign Subsidiary, (iii) Navigations Solutions and (iv) Hertz
Vehicle Sales Corporation); and

(iii)          each PRUSVI Security Document executed and delivered by a
duly authorized officer of Puerto Ricancars and each other Loan Party signatory
thereto.

(b)           Reserved.

(c)           Reserved.

(d)           Reserved.

 

58

 

(e)           Reserved.

(f)            Collateral
Assignments of Manufacturer Repurchase Program Agreements.  The Administrative Agent shall have received
a collateral assignment of the Manufacturer Repurchase Program Agreements with
General Motors and Ford, as each such Manufacturer Repurchase Program Agreement
relates to the Facility Assets, executed and delivered by each applicable
manufacturer in form and substance reasonably satisfactory to Administrative
Agent.

(g)           Financial
Information.  The Administrative
Agent shall have received unaudited financial statements for the Borrowers for
the most recent interim quarter for which financial statements are available
(but in no event for a period ended less than 45 days prior to the Closing
Date).

(h)           Governmental
Approvals and/or Consents.  All Loans
to the Borrowers (and all guarantees thereof and security therefor), shall be
in substantial compliance in all material respects with all applicable
requirements of law, including Regulations T, U and X of the Board (the “Margin
Regulations”).  The Administrative
Agent shall have received a certificate of a Responsible Officer of the Parent
Borrower stating that all other consents, authorizations, notices and filings
referred to in Schedule 5.4 are in full force and effect or have the status
described therein, and the Administrative Agent shall have received evidence
thereof reasonably satisfactory to it.

(i)            Lien
Searches.  The Administrative Agent
shall have received the results of a recent search by a Person reasonably
satisfactory to the Administrative Agent, of the UCC, judgment and tax lien
filings which have been filed with respect to personal property of the Parent
Borrower and Puerto Ricancars in any of the jurisdictions set forth in Schedule
6.1(i), and the results of such search shall not reveal any liens other than
liens permitted by subsection 8.1.

(j)            Legal
Opinions. The Administrative Agent shall have received the following
executed legal opinions:

(i)            the
executed legal opinion of Debevoise & Plimpton LLP, special New York
counsel to each of the Parent Borrower, Puerto Ricancars and the other Loan
Parties, substantially in the form of Exhibit D-1;

(ii)           the executed legal opinion of Harold Rolfe, general
counsel to the Parent Borrower, substantially in the form of Exhibit D-2;

(iii)          the executed legal opinion of Tom Bolt & Associates,
P.C., special United States Virgin Islands counsel to each of the Parent
Borrower, Puerto Ricancars and certain other Loan Parties, substantially in the
form of Exhibit D-3; and

(iv)          the executed legal opinion of Adsuar Muñiz Goyco &
Besosa, P.S.C., special Puerto Rico counsel to each of the Parent Borrower,
Puerto Ricancars and certain other Loan Parties, substantially in the form of
Exhibit D-4; and

 

59

 

(k)           Closing
Certificate.  The Administrative
Agent shall have received a certificate from each Loan Party, dated the Closing
Date, substantially in the form of Exhibit I, with appropriate insertions and
attachments.

(l)            Perfected
Liens.

(i)            The
Domestic Collateral Agent shall, subject to the provisions (the “Security
Provisions”) contained in the definition of “Eligible Vehicles” set forth in
subsection 1.1 hereof and subsection 7.13 hereof have obtained a valid security
interest in the Collateral covered by the Domestic Guarantee and Collateral
Agreement (with the priority contemplated therein); and, subject to the
Security Provisions, all documents, instruments, filings, recordations and
searches reasonably necessary in connection with the perfection of such
security interests shall have been executed and delivered, in the case of UCC
filings, written authorization to make such UCC filings shall have been
delivered to the Domestic Collateral Agent, and none of such collateral shall
be subject to any other pledges, security interests or mortgages except for
Permitted Liens; provided that with respect to any such collateral the
security interest in which may not be perfected by filing of a UCC financing
statement, if perfection of the Domestic Collateral Agent’s security interest
in such collateral may not be accomplished on or before the Closing Date
without undue burden or expense, then delivery of documents and instruments for
perfection of such security interest shall not constitute a condition precedent
to the initial borrowings hereunder.

(ii)           The PRUSVI Collateral Agent shall, subject to the Security
Provisions, have obtained a valid security interest in the Collateral covered
by the PRUSVI Guarantee and Collateral Agreement (with the priority
contemplated therein); and, subject to the Security Provisions, all documents,
instruments, filings, recordations and searches reasonably necessary in connection
with the perfection of such security interests shall have been executed and
delivered and none of such collateral shall be subject to any other pledges,
security interests or mortgages except for Permitted Liens.

(m)          Reserved.

(n)           Reserved.

(o)           Fees.
 The Agents and the Lenders shall have
received all fees and expenses required to be paid or delivered by the
Borrowers to them on or prior to the Closing Date, including the fees referred
to in subsection 4.5.

(p)           Borrowing
Certificate.  The Administrative
Agent shall have received a certificate from Puerto Ricancars and the Parent
Borrower, dated the Closing Date, substantially in the form of Exhibit H, with
appropriate insertions and attachments, reasonably satisfactory in form and
substance to the Administrative Agent, executed by a Responsible Officer and
the Secretary or any Assistant Secretary of Puerto Ricancars and the Parent
Borrower.

 

60

 

(q)           Corporate
Proceedings of the Loan Parties.  The
Administrative Agent shall have received a copy of the resolutions, in form and
substance reasonably satisfactory to the Administrative Agent, of the board of
directors of each Loan Party authorizing, as applicable, (i) the
execution, delivery and performance of this Agreement, any Notes and the other
Loan Documents to which it is or will be a party as of the Closing Date, (ii)
the Extensions of Credit to such Loan Party (if any) contemplated hereunder and
(iii) the granting by it of the Liens to be created pursuant to the Security
Documents to which it will be a party as of the Closing Date, certified by the
Secretary or an Assistant Secretary of such Loan Party as of the Closing Date,
which certificate shall be in form and substance reasonably satisfactory to the
Administrative Agent and shall state that the resolutions thereby certified
have not been amended, modified (except as any later such resolution may modify
any earlier such resolution), revoked or rescinded and are in full force and
effect.

(r)            Incumbency
Certificates of the Loan Parties. 
The Administrative Agent shall have received a certificate of each Loan
Party, dated the Closing Date, as to the incumbency and signature of the
officers of such Loan Party executing any Loan Document, reasonably
satisfactory in form and substance to the Administrative Agent executed by a
Responsible Officer and the Secretary or any Assistant Secretary of such Loan
Party.

(s)           Governing
Documents.  The Administrative Agent
shall have received copies of the certificate or articles of incorporation and
by-laws (or other similar governing documents serving the same purpose) of each
Loan Party, certified as of the Closing Date as complete and correct copies
thereof by the Secretary or an Assistant Secretary of such Loan Party.

(t)            Insurance.  Parent Borrower shall have used reasonable
best efforts to ensure that the Administrative Agent shall have received
evidence in form and substance reasonably satisfactory to it that all of the
requirements of subsection 7.5 of this Agreement and subsection 5.2.2 Domestic
Guarantee and Collateral Agreement and any similar section of any PRUSVI
Guarantee and Collateral Agreement shall have been satisfied. Parent Borrower
shall have used reasonable best efforts to cause the Administrative Agent and
the other Secured Parties to have been named as additional insureds with
respect to liability policies and the Domestic Collateral Agent and/or the
PRUSVI Collateral Agent, as applicable, to have been named as loss payee with
respect to the casualty insurance maintained by each Borrower insuring the
Facility Assets.

(u)           No
Material Adverse Effect.  No fact,
event, change or circumstances shall have occurred since June 30, 2006 that has
had or would be reasonably likely to have a Material Adverse Effect.  Only as used in this subsection 6.1(u), “Material
Adverse Effect” shall mean an effect that results in or causes, or would
reasonably be expected to result in or cause, a material adverse change in any
of (a) the condition (financial or otherwise), business, operations or property
of the Parent Borrower and its subsidiaries, taken as a whole, and (b) the
validity or enforceability of any Loan Document or the rights and remedies of
the Administrative Agent, the Lenders and the other Secured Parties under the
Loan Documents, in each case taken as a whole.

(v)           Reserved.

 

61

 

(w)          Reserved.

(x)            Reserved.

(y)           Reserved.

(z)            Solvency.  The Administrative Agent shall have received
a certificate of the chief financial officer or, if none, the treasurer,
controller, vice president (finance) or other responsible financial officer
reasonably satisfactory to the Administrative Agent of each of the Borrowers
certifying the solvency of such Borrower in customary form (as per the
applicable jurisdiction of such Borrower) reasonably satisfactory to the
Administrative Agent.

(aa)         Borrowing
Base Certificate.  The Administrative
Agent shall have received a Borrowing Base Certificate pursuant to subsection
7.2(f).

(bb)         Cash
Management.  The Administrative Agent
shall be reasonably satisfied with the arrangements made by the Parent Borrower
and Puerto Ricancars to comply with the provisions of Exhibit C hereof.

The making of the
initial Extensions of Credit by the Lenders hereunder shall conclusively be
deemed to constitute an acknowledgement by the Administrative Agent and each
Lender that each of the conditions precedent set forth in this subsection 6.1
shall have been satisfied in accordance with its respective terms or shall have
been irrevocably waived by such Person.

6.2           Conditions
to Each Other Extension of Credit. 
The agreement of each Lender to make any Extension of Credit requested
to be made by it on any date (including the initial Extension of Credit) is
subject to the satisfaction or waiver of the following conditions precedent:

(a)           Representations
and Warranties.  Each of the
representations and warranties made by any Loan Party pursuant to this
Agreement or any other Loan Document (or in any amendment, modification or
supplement hereto or thereto) to which it is a party, and each of the
representations and warranties contained in any certificate furnished at any
time by or on behalf of any Loan Party pursuant to this Agreement or any other
Loan Document shall, except to the extent that they relate to a particular
date, 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)           Borrowing
Notice.  With respect to any
Borrowing, the Administrative Agent shall have received a notice of such
Borrowing as required by subsection 2.2 (or such notice shall have been deemed
given in accordance with subsection 2.2).

Each borrowing of
Loans by any of the Borrowers hereunder shall constitute a representation and
warranty by the Borrowers as of the date of such borrowing that the

 

62

 

conditions contained in this subsection 6.2 have been satisfied
(including, with respect to the initial Extension of Credit hereunder).

SECTION 7.  AFFIRMATIVE COVENANTS.

Each of the Parent
Borrower and Puerto Ricancars hereby agrees that, from and after the Closing
Date and so long as the Revolving Facility Commitments remain in effect, and
thereafter until payment in full of the Loans and any other amount then due and
owing to any Lender or any Agent hereunder and under any Note, each of the
Parent Borrower and Puerto Ricancars shall and (except in the case of delivery
of financial information, reports and notices) shall cause each of its
respective Subsidiaries to:

7.1           Financial
Statements.  Furnish to the
Administrative Agent for delivery to each Lender (and the Administrative Agent
agrees to make and so deliver such copies):

(a)           as
soon as available, but in any event not later than the fifth Business Day after
the 90th day following the end of each fiscal year of the Parent Borrower
ending on or after December 31, 2006, a copy of the consolidated balance sheet
of the Parent Borrower and its consolidated Subsidiaries as at the end of such
year and the related consolidated statements of operations, stockholder’s
equity and cash flows for such year, setting forth in each case, in comparative
form the figures for and as of the end of 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 PricewaterhouseCoopers LLP or other
independent certified public accountants of nationally recognized standing not
unacceptable to the Administrative Agent in its reasonable judgment (it being
agreed that the furnishing of the Parent Borrower’s annual report on Form 10-K
for such year, as filed with the Securities and Exchange Commission, will
satisfy the Parent Borrower’s obligation under this subsection 7.1(a) with
respect to such year except with respect to the requirement that such financial
statements be reported on without a “going concern” or like qualification or
exception, or qualification arising out of the scope of the audit); and

(b)           as soon
as available, but in any event not later than the fifth Business Day after the
45th day following the end of each of the first three quarterly periods of each
fiscal year of the Parent Borrower, the unaudited consolidated balance sheet of
the Parent Borrower and its consolidated Subsidiaries as at the end of such
quarter and the related unaudited consolidated statements of operations and
cash flows of the Parent Borrower and its consolidated Subsidiaries 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 and as of the
corresponding periods of the previous year, certified by a Responsible Officer
of the Parent Borrower as being fairly stated in all material respects (subject
to normal year-end audit and other adjustments) (it being agreed that the
furnishing of the Parent Borrower’s quarterly report on Form 10-Q for such
quarter, as filed with the Securities and Exchange Commission, will satisfy the
Parent Borrower’s obligations under this subsection 7.1(b) with respect to such
quarter);

(c)           as
soon as available, but in any event not later than the fifth Business Day after
the 30th day following the end of each month, the unaudited consolidated
balance sheet of the Parent Borrower and its consolidated Subsidiaries as at
the end of such month (other than any month that is the last month of a fiscal
quarter) and the related unaudited statement of operations

 

63

 

of the Parent Borrower and its consolidated Subsidiaries for
such month, setting forth in each case, in comparative form the figures for and
as of the end of the corresponding month during the previous year; and

(d)           all
such financial statements delivered pursuant to subsection 7.1(a) or (b) to be
(and, in the case of any financial statements delivered pursuant to subsection
7.1(b) shall be certified by a Responsible Officer of the Parent Borrower as
being) complete and correct in all material respects in conformity with GAAP
and to be (and, in the case of any financial statements delivered pursuant to
subsection 7.1(b) shall be certified by a Responsible Officer of the Parent
Borrower as being) prepared in reasonable detail in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods that began on or after the Closing Date (except as approved by such
accountants or officer, as the case may be, and disclosed therein, and except,
in the case of any financial statements delivered pursuant to subsection
7.1(b), for the absence of certain notes);

(e)            as
soon as available, but in any event not later than (i) October 31, 2006 with
respect to the fiscal year of Puerto Ricancars ending on or about December 31,
2005 and (ii) 270 days following the end of each fiscal year of Puerto
Ricancars thereafter, a copy of the consolidated balance sheet of Puerto
Ricancars and its consolidated Subsidiaries as at the end of such year and the
related consolidated statements income and retained earnings and cash flows for
such year, setting forth in each case, in comparative form the figures for and
as of the end of 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 PricewaterhouseCoopers LLP or other independent certified public
accountants of nationally recognized standing not unacceptable to the
Administrative Agent in its reasonable judgment; and

(f)           
as soon as available, following the end of each of the first three quarterly
periods of each fiscal year of Puerto Ricancars, the unaudited consolidated
balance sheet of Puerto Ricancars and its consolidated Subsidiaries as at the
end of such quarter and the related unaudited consolidated statements of income
and retained earnings and cash flows of Puerto Ricancars and its consolidated
Subsidiaries 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 and as of the corresponding periods of the previous year, certified
by a Responsible Officer of Puerto Ricancars as being fairly stated in all
material respects (subject to normal year-end audit and other adjustments);

(g)           all
such financial statements delivered pursuant to subsection 7.1(e) or (f) to be
(and shall be certified by a Responsible Officer of Puerto Ricancars as being)
complete and correct in all material respects in conformity with GAAP and to be
(and shall be certified by a Responsible Officer of Puerto Ricancars as being)
prepared in reasonable detail in accordance with GAAP applied consistently
throughout the periods reflected therein and with prior periods that began on
or after the Closing Date (except as approved by such accountants or officer,
as the case may be, and disclosed therein, and except, in the case of any
financial statements delivered pursuant to subsection 7.1(f), for the absence
of certain notes);

 

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7.2           Certificates;
Other Information.  Furnish to the
Administrative Agent for delivery to each Lender (and the Administrative Agent
agrees to make and so deliver such copies):

(a)           concurrently
with the delivery of the financial statements referred to in subsection 7.1(a)
and 7.1(e), a certificate of the independent certified public accountants
reporting on such financial statements stating that in making the audit
necessary therefor no knowledge was obtained of any Default or Event of Default
insofar as the same relates to any financial accounting matters covered by
their audit, except as specified in such certificate (which certificate may be
limited to the extent required by accounting rules or guidelines);

(b)           concurrently
with the delivery of the financial statements and reports referred to in
subsections 7.1(a) and (b) and 7.1(e) and (f), a certificate signed by a
Responsible Officer of each of the Parent Borrower or Puerto Ricancars, as
applicable stating that, to the best of such Responsible Officer’s knowledge,
each of the Parent Borrower or Puerto Ricancars and their respective
Subsidiaries during such period has observed or performed all of its covenants
and other agreements, and satisfied every condition, contained in this
Agreement or 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, in each case, as
specified in such certificate;

(c)           as
soon as available, but in any event not later than the fifth Business Day
following the 90th day after the beginning of each fiscal year of the Parent
Borrower, a copy of the annual business plan by the Parent Borrower of the
projected operating budget (including an annual consolidated balance sheet,
income statement and statement of cash flows of the Parent Borrower and its
Subsidiaries) and including segment information consistent with customary past
practices of the Parent Borrower, such practices subject to such adjustments as
are reasonable in the good faith determination of the Parent Borrower, each
such business plan to be accompanied by a certificate of a Responsible Officer
of the Parent Borrower to the effect that such Responsible Officer believes
such projections to have been prepared on the basis of reasonable assumptions
at the time of preparation and delivery thereof;

(d)           within
five Business Days after the same are sent, copies of all financial statements
and reports which, the Parent Borrower sends to its public security holders,
and within five Business Days after the same are filed, copies of all financial
statements and periodic reports which the Parent Borrower may file with the
Securities and Exchange Commission or any successor or analogous Governmental
Authority;

(e)           within
five Business Days after the same are filed, copies of all registration
statements and any amendments and exhibits thereto, which the Parent Borrower
may file with the Securities and Exchange Commission or any successor or
analogous Governmental Authority, and such other documents or instruments as
may be reasonably requested by the Administrative Agent in connection
therewith; and

(f)            not
later than 5:00 P.M. (New York time) on or before the tenth Business Day of
each Fiscal Period of the Parent Borrower and its Subsidiaries (or (i) more
frequently as the Parent Borrower may elect or (ii) upon the occurrence and
continuance of an Event of 

 

65

Default, not later than Wednesday of each week), a borrowing
base certificate setting forth the Domestic Borrowing Base and the PRUSVI
Borrowing Base (in each case with supporting calculations) substantially in the
form of Exhibit J (each, a “Borrowing Base Certificate”), which shall be
prepared as of the last Business Day of the preceding Fiscal Period of the
Parent Borrower and its Subsidiaries (or (x) such other applicable date in the
case of clause (i) above or (y) the previous Friday in the case of clause (ii)
above) in the case of each subsequent Borrowing Base Certificate.  Each such Borrowing Base Certificate shall
include such supporting information as may be reasonably requested from time to
time by the Administrative Agent; and

(g)           promptly,
such additional financial and other information as any Agent or Lender may from
time to time reasonably request.

7.3           Payment
of Obligations.  Pay, discharge or
otherwise satisfy at or before maturity or before they become delinquent, as
the case may be, all its material obligations of whatever nature, including
taxes, except where the amount or validity thereof is currently being contested
in good faith by appropriate proceedings diligently conducted and reserves in
conformity with GAAP with respect thereto have been provided on the books of
the Parent Borrower or any of its Subsidiaries, as the case may be.

7.4           Conduct
of Business and Maintenance of Existence. 
Continue to engage in business of the same general type as conducted by
the Borrowers and their Subsidiaries on the Closing Date, taken as a whole, and
preserve, renew and keep in full force and effect its corporate existence and
take all reasonable action to maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of the business of the Borrowers
and their Subsidiaries, taken as a whole, except as otherwise expressly
permitted pursuant to subsection 8.3, provided that the Borrowers and
their Subsidiaries shall not be required to maintain any such rights,
privileges or franchises, if the failure to do so would not reasonably be
expected to have a Material Adverse Effect; and comply with all Contractual
Obligations and Requirements of Law except to the extent that failure to comply
therewith, in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.

7.5           Maintenance
of Property, Insurance.  Keep all
property useful and necessary in the business of the Borrowers and their
Subsidiaries, taken as a whole, in good working order and condition; maintain
with financially sound and reputable insurance companies insurance on all
property material to the business of the Borrowers and their Subsidiaries,
taken as a whole, in at least such amounts and against at least such risks (but
including in any event public liability, product liability and business
interruption) as are consistent with the past practices of the Borrowers and
their Subsidiaries and otherwise as are usually insured against in the same
general area by companies engaged in the same or a similar business; furnish to
the Administrative Agent, upon written request, information in reasonable
detail as to the insurance carried; and ensure that at all times the
Administrative Agent and the other Secured Parties shall be named as additional
insureds with respect to liability policies and the Administrative Agent,
Domestic Collateral Agent and/or the PRUSVI Collateral Agent, as applicable,
shall be named as loss payee with respect to the casualty insurance maintained
by each Borrower with respect to the Facility Assets; provided that,
unless an Event of Default shall have occurred and be continuing, the
Administrative Agent, Domestic Collateral Agent and/or the PRUSVI Collateral
Agent, as applicable, shall turn over to the applicable Borrower any amounts
received by it as 

 

66

loss payee under any casualty insurance maintained by the
Borrowers or their Subsidiaries and, unless an Event of Default shall have
occurred and be continuing, the Administrative Agent, the Domestic Collateral
Agent and PRUSVI Collateral Agent agree that the Borrowers shall have the sole
right to adjust or settle any claims under such insurance.

7.6           Inspection
of Property; Books and Records; Discussions.  (a) 
Keep proper books of records and account in which full, complete and
correct entries in conformity with GAAP and all material Requirements of Law
shall be made of all dealings and transactions in relation to its business and
activities; and permit representatives of the Administrative Agent to visit and
inspect any of its properties and examine and, to the extent reasonable, make
abstracts from any of its books and records and to discuss the business,
operations, properties and financial and other condition of such entity and its
Subsidiaries with officers and employees of such entity and its Subsidiaries
and with its independent certified public accountants, in each case at any
reasonable time, upon reasonable notice, and as often as may reasonably be
desired.  Each Borrower shall keep
records of its Vehicles constituting Facility Assets that are accurate and
complete in all material respects and shall furnish the Administrative Agent
with reports respecting such Vehicles in form and detail reasonably
satisfactory to the Administrative Agent and Lenders at such times as the
Administrative Agent may reasonably request.

(b)           At
reasonable times during normal business hours and upon reasonable prior notice
that the Administrative Agent requests, independently of or in connection with
the visits and inspections provided for in clause (a) above, the Borrowers will
grant access to the Administrative Agent (including employees of the
Administrative Agent or any consultants, accountants, lawyers and appraisers
retained by the Administrative Agent) to such Person’s premises, books,
records, accounts, and Vehicles constituting Facility Assets so that the
Administrative Agent may conduct (or engage third parties to conduct) such
field examinations, verifications and evaluations (including environmental
assessments) of the Facility Assets as the Administrative Agent may deem
necessary or appropriate.  Unless an
Event of Default exists, or if previously approved by Parent Borrower or its
Subsidiary, no environmental assessment by the Administrative Agent may include
any sampling or testing of the soil, surface water or groundwater.  All such field examinations and other
verifications and evaluations shall be at the sole expense of the Loan Parties;
provided that absent the existence and continuation of an Event of Default,
such expenses shall not exceed $50,000 per year.  All amounts chargeable to the applicable
Borrowers under this subsection 7.6(b) shall constitute obligations that are
secured by all of the applicable Collateral and shall be payable to the
Administrative Agent hereunder.

7.7           Notices.  Promptly give notice to the Administrative
Agent and each Lender of:

(a)           as
soon as possible after a Responsible Officer of either Borrower knows or
reasonably should know thereof, the occurrence of any Default or Event of
Default;

(b)           as
soon as possible after a Responsible Officer of either Borrower knows or
reasonably should know thereof, any litigation, investigation or proceeding
which may exist at any time between the Borrowers or any of their Subsidiaries
and any Governmental Authority, which in either case, if adversely determined
would reasonably be expected to have a Material Adverse Effect;

 

67

 

(c)           as
soon as possible after a Responsible Officer of either Borrower knows or
reasonably should know thereof, the occurrence of any default or event of
default under any of the Indentures, the Existing ABL Facility Credit
Agreement, or the Senior Term Loans Credit Agreement or any default or Event of
Default or amortization event under the U.S. ABS Program Documents; or

(d)           the
following events, as soon as possible and in any event within 30 days after a
Responsible Officer of either Borrower or any of its Subsidiaries knows or
reasonably should know thereof:  (i) the occurrence or expected occurrence
of any Reportable Event (or similar event) with respect to any Single Employer
Plan (or Foreign Plan), a failure to make any required contribution to a Single
Employer Plan, Multiemployer Plan or Foreign Plan, the creation of any Lien on
the property of the Borrowers or their Subsidiaries in favor of the PBGC, a
Plan or a Foreign Plan or any withdrawal from, or the full or partial
termination, Reorganization or Insolvency of, any Multiemployer Plan or Foreign
Plan; (ii) the institution of proceedings or the taking of any other formal
action by the PBGC or the Borrowers or any of their Subsidiaries or any
Commonly Controlled Entity or any Multiemployer Plan which could reasonably be
expected to result in the withdrawal from, or the termination, Reorganization
or Insolvency of, any Single Employer Plan, Multiemployer Plan or Foreign Plan;
provided, however, that no such notice will be required under
clause (i) or (ii) above unless the event giving rise to such notice, when
aggregated with all other such events under clause (i) or (ii) above, could be
reasonably expected to result in a Material Adverse Effect; or (iii) the first
occurrence of an Underfunding under a Single Employer Plan or Foreign Plan that
exceeds 10% of the value of the assets of such Single Employer Plan or Foreign
Plan, in each case, determined as of the most recent annual valuation date of
such Single Employer Plan or Foreign Plan on the basis of the actuarial
assumptions used to determine the funding requirements of such Single Employer
Plan or Foreign Plan as of such date;

(e)           Reserved;

(f)            as
soon as possible after a Responsible Officer of either Borrower knows or
reasonably should know thereof, (i) any release or discharge by the Borrowers
or any of their Subsidiaries of any Materials of Environmental Concern required
to be reported under applicable Environmental Laws to any Governmental
Authority, unless the Parent Borrower reasonably determines that the total
Environmental Costs arising out of such release or discharge would not reasonably
be expected to have a Material Adverse Effect; (ii) any condition,
circumstance, occurrence or event not previously disclosed in writing to the
Administrative Agent that would reasonably be expected to result in liability
or expense under applicable Environmental Laws, unless the Parent Borrower
reasonably determines that the total Environmental Costs arising out of such
condition, circumstance, occurrence or event would not reasonably be expected
to have a Material Adverse Effect, or would not reasonably be expected to
result in the imposition of any lien or other material restriction on the
title, ownership or transferability of any facilities and properties owned,
leased or operated by the Borrowers or any of their Subsidiaries that would
reasonably be expected to result in a Material Adverse Effect; and (iii) any
proposed action to be taken by the Borrowers or any of their Subsidiaries that
would reasonably be expected to subject the Borrowers or any of their
Subsidiaries to any material additional or different requirements or
liabilities under Environmental Laws, unless the Parent Borrower reasonably
determines that the 

 

68

 

total Environmental Costs arising out of such proposed action
would not reasonably be expected to have a Material Adverse Effect; and

(g)           any
loss, damage, or destruction to the Facility Assets in the amount of $1,000,000
or more, whether or not covered by insurance;

Each notice
pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer of the Parent Borrower or Puerto Ricancars, as applicable
(and, if applicable, the relevant Commonly Controlled Entity or Subsidiary)
setting forth details of the occurrence referred to therein and stating what action
the Parent Borrower or Puerto Ricancars (or, if applicable, the relevant
Commonly Controlled Entity or Subsidiary) proposes to take with respect
thereto.

7.8           Environmental
Laws.  (a)  (i) 
Comply substantially with, and require substantial compliance by all
tenants, subtenants, contractors, and invitees with, all applicable
Environmental Laws; (ii) obtain, comply substantially with and maintain any and
all Environmental Permits necessary for its operations as conducted and as
planned; and (iii) require that all tenants, subtenants, contractors, and
invitees obtain, comply substantially with and maintain any and all
Environmental Permits necessary for their operations as conducted and as
planned, with respect to any property leased or subleased from, or operated by
the Borrowers or their Subsidiaries.  For
purposes of this subsection 7.8(a), noncompliance shall not  constitute a breach of this covenant, provided
that, upon learning of any actual or suspected noncompliance, the Borrowers and
any such affected Subsidiary shall promptly undertake and diligently pursue
reasonable efforts, if any, to achieve compliance, and provided, further,
that in any case such noncompliance would not reasonably be expected to have a
Material Adverse Effect.

(b)           Promptly
comply, in all material respects, with all orders and directives of all
Governmental Authorities regarding Environmental Laws, other than such orders
or directives (i) as to which the failure to comply would not reasonably be
expected to result in a Material Adverse Effect or (ii) as to which: (x)
appropriate reserves have been established in accordance with GAAP; (y) an
appeal or other appropriate contest is or has been timely and properly taken
and is being diligently pursued in good faith; and (z) if the effectiveness of
such order or directive has not been stayed, the failure to comply with such
order or directive during the pendency of such appeal or contest could not
reasonably be expected to give rise to a Material Adverse Effect.

(c)           Maintain,
update as appropriate, and implement in all material respects an ongoing
program reasonably designed to ensure that all the properties and operations of
the Borrowers and their Subsidiaries are periodically reasonably reviewed by
competent personnel to identify and promote compliance with and to reasonably
and prudently manage any material Environmental Costs that would reasonably be
expected to affect the Parent Borrower or any of its Subsidiaries, including
compliance and liabilities relating to:  discharges to air and water;
acquisition, transportation, storage and use of hazardous materials; waste
disposal; species protection; and recordkeeping required under Environmental
Laws.  For the purposes of this
subsection 7.8(c), the failure to maintain an environmental program shall not
constitute an Event of Default (i) unless it would reasonably be expected to
result in a Material Adverse Effect or (ii) if within 90 days of receipt
of a reasonable request from the Administrative Agent, the 

 

69

 

Borrowers and their Subsidiaries have taken reasonable and
diligent steps to implement and maintain such a program in compliance with this
subsection.

7.9           Reserved.

7.10         Reserved.

7.11         Reserved.

7.12         Reserved.

7.13         Post-Closing
Security Perfection.  Notwithstanding
anything in this Agreement or any other Loan Document to the contrary, with
respect to the Vehicles constituting Collateral owned on the Closing Date, the
Borrowers will not be required to deliver the motor vehicle titles evidencing
the liens of the Domestic Collateral Agent or the PRUSVI Collateral Agent, as
applicable, on such Vehicles, and in particular to cause the security interest
of the Domestic Collateral Agent or the PRUSVI Collateral Agent, as applicable,
to be stamped or otherwise noted on the certificates of title for such
Vehicles, until (i) 240 days in the case of Vehicles registered or to be
registered in the Commonwealth of Puerto Rico, (ii) 180 days in the case of
Vehicles registered or to be registered in the U.S. Virgin Islands and (iii)
seven (7) days in the case of Vehicles registered or to be registered in the
state of Hawaii, in each case, following the date of submission of the
registration documentation to the applicable Governmental Authority.  With respect to the Vehicles owned on the
Closing Date, the Borrowers shall submit the motor vehicle titles, together
with all other paperwork and documentation necessary to cause the security
interest of the Domestic Collateral Agent or the PRUSVI Collateral Agent, as
applicable, to be stamped or otherwise noted on the certificates of title for
such Vehicles and as appropriate, file financing statements with respect to the
security interest granted to the PRUSVI Collateral Agent in Vehicles owned by
Puerto Ricancars, to the applicable Hawaii, Puerto Rico and U.S. Virgin Islands
governmental authorities as promptly as is reasonably practicable for the
applicable Borrower.  A Vehicle owned on
the Closing Date shall become an “Eligible Vehicle”, (i.e. eligible for
inclusion in the Domestic Borrowing Base or PRUSVI Borrowing Base, as
applicable) at the time that the applicable motor vehicle title, together with
all other paperwork and documentation necessary to cause the security interest
of the Domestic Collateral Agent or the PRUSVI Collateral Agent, as applicable,
to be stamped or otherwise noted on such certificate of title, has been
submitted to the applicable Hawaii, Puerto Rico or U.S. Virgin Islands
governmental authorities.  Failure to
satisfy any of the foregoing requirements will not constitute a breach or
result in any Default under this Agreement; provided, that, any
Vehicles for which the requirements of the first sentence of this paragraph are
not satisfied within the applicable time period shall be excluded from the
Domestic Borrowing Base or PRUSVI Borrowing Base, as applicable, upon the
expiration of the applicable time period and remain so excluded until such time
as the applicable requirements are so satisfied.

7.14         Existing
ABL Facility Advance Rate Event. 
Parent Borrower shall notify the Administrative Agent in writing
promptly, and in any event within two (2) Business Days of the occurrence of an
Existing ABL Facility Advance Rate Event.

 

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SECTION 8.  NEGATIVE COVENANTS.  Each of the Parent Borrower and Puerto
Ricancars hereby agrees that, from and after the Closing Date and so long as
the Revolving Facility Commitments remain in effect, and thereafter until
payment in full of the Loans and any other amount then due and owing to any
Lender or any Agent hereunder and under any Note, the Parent Borrower and
Puerto Ricancars shall not and shall not permit any of its respective
Subsidiaries to, directly or indirectly:

8.1           Limitation
on Liens.  Create, incur, assume or
suffer to exist any Lien upon any of the Facility Assets, whether now owned or
hereafter acquired, except for the following (Liens described below are herein
referred to as “Permitted Liens”; provided, however, that no
reference to a Permitted Lien herein, including any statement or provision as
to the acceptability of any Permitted Lien, shall in any way constitute or be
construed so as to postpone or subordinate any Liens or other rights of the
Agents, the Lenders or any of them hereunder or arising under any other Loan
Document in favor of such Permitted Lien):

(a)           Liens
for taxes, assessments and similar charges not yet delinquent or the nonpayment
of which in the aggregate would not reasonably be expected to have a Material
Adverse Effect, or which are being contested in good faith by appropriate
proceedings diligently conducted and adequate reserves with respect thereto are
maintained on the books of the Parent Borrower or its Subsidiaries, as the case
may be, in conformity with GAAP;

(b)           carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens
arising in the ordinary course of business and relating to obligations which
are not overdue for a period of more than 60 days or which are being contested
in good faith by appropriate proceedings diligently conducted;

(c)           Liens
of landlords or of mortgagees of landlords arising by operation of law or
pursuant to the terms of real property leases, provided that the rental
payments secured thereby are not yet due and payable;

(d)           pledges,
deposits or other Liens in connection with workers’ compensation, unemployment
insurance, other social security benefits or other insurance related
obligations (including pledges or deposits securing liability to insurance
carriers under insurance or self-insurance arrangements);

(e)           Liens
arising by reason of any judgment, decree or order of any court or other
Governmental Authority, if appropriate legal proceedings which may have been
duly initiated for the review of such judgment, decree or order, are being
diligently prosecuted and shall not have been finally terminated or the period
within which such proceedings may be initiated shall not have expired;

(f)            Liens
to secure the performance of bids, trade contracts (other than for borrowed
money), obligations for utilities, leases, statutory obligations, surety and
appeal bonds, performance bonds, judgment and like bonds, replevin and similar
bonds and other obligations of a like nature incurred in the ordinary course of
business;

 

71

 

(g)           zoning
restrictions, easements, rights-of-way, restrictions on the use of property,
other similar encumbrances incurred in the ordinary course of business and
minor irregularities of title, which do not materially interfere with the
ordinary conduct of the business of the Parent Borrower and its Subsidiaries
taken as a whole;

(h)           Liens
created pursuant to the LKE Program;

(i)            Liens in
favor of third parties in connection with financing or other financial
accommodations provided by such third parties, provided, that,
(i) such liens shall not encumber any Facility Assets contained in the Total
Borrowing Base or any proceeds thereof, (ii) all cash and other proceeds of any
such Liens created in favor of such third parties shall be segregated in a
manner reasonably acceptable to the Administrative Agent from all cash and
other proceeds of Facility Assets contained in the Total Borrowing Base, (iii)
such liens shall not encumber any Kansas Vehicles or proceeds thereof and (iv)
with respect to each owner of Facility Assets, such liens shall not affect the
Facility Assets owned by such owner (x) disproportionately by manufacturer or
type of vehicle or (y) disproportionately by location of Facility Assets within
a given territory;

(j)             Purchase
money liens on vehicles in favor of the sellers of such vehicles, provided,
that, such liens are discharged prior to or contemporaneously with such
vehicles being included in the Total Borrowing Base; and

(k)           Liens
created pursuant to the Security Documents.

8.2           Limitation
on Fundamental Changes.  Enter into
any merger, consolidation or amalgamation, or liquidate, wind up or dissolve
itself (or suffer any liquidation or dissolution), or convey, sell, lease,
assign, transfer or otherwise dispose of, all or substantially all of its
property, business or assets, except:

(a)           any
Subsidiary of the Parent Borrower (other than Puerto Ricancars) may be merged,
consolidated or amalgamated with or into the Parent Borrower (provided that the
Parent Borrower shall be the continuing or surviving corporation) or any
Subsidiary of the Parent Borrower may be merged consolidated or amalgamated
with or into any one or more Wholly Owned Subsidiaries of the Parent Borrower
(provided, that, (i) the Wholly Owned Subsidiary or Subsidiaries of the Parent
Borrower shall be the continuing or surviving entity and (ii) in any merger
involving Puerto Ricancars, Puerto Ricancars shall be the continuing or
surviving entity);

(b)           any
Subsidiary of the Parent Borrower (other than Puerto Ricancars) may sell,
lease, transfer or otherwise dispose of any or all of its assets (upon
voluntary liquidation or otherwise) to the Parent Borrower or any Wholly Owned
Subsidiary of the Parent Borrower (and, in the case of a non-Wholly Owned
Subsidiary, may be liquidated to the extent the Parent Borrower or any Wholly
Owned Subsidiary which is a direct parent of such non-Wholly Owned Subsidiary
receives a pro rata distribution of the assets thereof);

(c)           any
conveyance, sale, lease, assignment, transfer or other disposition of property,
business or assets not constituting Facility Assets; provided, that not more
than 

 

72

 

$125,000,000 in the aggregate shall be permitted to be sold
pursuant to this clause (d) after the Closing Date;

(d)           any
Financing Disposition (as such term is defined in the Existing ABL Facility
Credit Agreement, as in effect on the date hereof) not involving Facility
Assets (unless in compliance with Section 8.1(i)); and

(e)           as
expressly permitted by subsection 8.3 below.

8.3           Limitation
on Sale of Assets.  Convey, sell,
lease, assign, transfer, license, abandon or otherwise dispose (including,
without limitation, in any sale-leaseback transaction) of any of the Facility
Assets, whether now owned or hereafter acquired, to any Person, unless (a)
after giving pro forma effect thereto (including the application of the net
proceeds thereof), (i) the Aggregate Lender Exposure outstanding to the
Borrowers would not exceed the Total Borrowing Base, (ii) the Aggregate Lender
Exposure outstanding to the Parent Borrower would not exceed the Domestic
Borrowing Base and (iii) the Aggregate Lender Exposure outstanding to Puerto
Ricancars would not exceed the PRUSVI Borrowing Base or (b) the net cash
proceeds thereof are applied to repay the outstanding Revolving Credit Loans
(without any corresponding reduction in the Revolving Facility Commitments); provided,
further, that, in the case of any sale and leaseback transaction or
securitization transaction involving the Facility Assets: (i) all cash and
other proceeds of any such transaction shall be segregated in a manner
reasonably acceptable to the Administrative Agent from all cash and other
proceeds of Facility Assets contained in the Total Borrowing Base, (ii) any
such transaction shall not involve the Kansas Vehicles or the proceeds thereof
and (iii) any such transaction shall not affect the Facility Assets (x)
disproportionately by manufacturer or type of vehicles, (y) disproportionately
by location of Facility Assets or (z) disproportionately by owner of Facility
Assets (i.e., among Borrowers).

8.4           Reserved.

8.5           Limitation
on Negative Pledge Clauses.  Enter
into with any Person any agreement which prohibits or limits the ability of the
Parent Borrower or Puerto Ricancars to create, incur, assume or suffer to exist
any Lien in favor of the Lenders in respect of obligations and liabilities
under this Agreement or any other Loan Documents upon any of the Facility
Assets, whether now owned or hereafter acquired, other than (a) this Agreement,
the other Loan Documents and any related documents, the Senior Term Loans
Documents, and the Existing ABL Facility Loan Documents, (b)
those negative pledge clauses with respect to Facility Assets contained in debt
instruments and agreements to which a Borrower is a party on the Closing Date
which are set forth on Schedule 8.5, (c) agreements relating to a LKE Program,
(d) agreements governing financing or other financial accommodations provided
by third parties to any Borrower and satisfying all of the requirements set
forth in subsection 8.1(i), and (e) agreements governing purchase money
financing provided by the manufacturers of Vehicles, provided, that,
such purchase money financing satisfies all of the requirements set forth in
subsection 8.1(j).

8.6           Limitation
on Lines of Business.   Enter into
any business, either directly or through any Subsidiary or joint venture or
similar arrangement, except for those businesses of the same general type as
those in which Parent Borrower and its Subsidiaries are engaged on the Closing
Date or which are reasonably related thereto.

 

73

 

8.7           Negative
Pledge.  The Borrowers shall not
directly or indirectly enter into or assume any agreement (other than the Loan
Documents) creating any Lien upon any Kansas Vehicles, whether now owned or
hereafter acquired, other than Liens as expressly permitted pursuant to Section
8.1 hereof

SECTION 9.  EVENTS OF DEFAULT.  If any of the following events shall occur
and be continuing:

(a)           Any
of the Borrowers shall fail to pay any principal of any Loan when due in
accordance with the terms hereof (whether at stated maturity, by mandatory
prepayment or otherwise); or any of the Borrowers shall fail to pay any
interest on any Loan, or any other amount payable hereunder, 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 in any amendment, modification or supplement hereto
or thereto) or which is contained in any certificate furnished at any time by
or on behalf of any Loan Party pursuant to this Agreement or any such other
Loan Document shall prove to have been incorrect in any material respect on or
as of the date made or deemed made; or

(c)           Any
Loan Party shall default in the observance or performance of any agreement
contained in subsections 4.16, 7.2(f) (after one Business Day grace period),
7.4 (with respect to maintenance of existence) 7.5, 7.6, 7.7(a) or Section 8 of
this Agreement; provided that, in the case of a default in the
observance or performance of its obligations under subsection 7.7(a) hereof, such
default shall have continued unremedied for a period of two days after a
Responsible Officer of the Parent Borrower shall have discovered or should have
discovered such default; and provided, further, that if (x) any
such failure with respect to subsections 4.16, 7.4, 7.5 or 7.6  is of a type that can be cured within five
Business Days and (y) such Default could not materially adversely impact the
Lenders’ Liens on the Collateral or the negative pledge with respect to the
Kansas Vehicles, such failure shall not constitute an Event of Default for five
Business Days after the occurrence thereof so long as the Loan Parties are
diligently pursuing the cure of such failure; 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 9), and such default shall
continue unremedied for a period ending on the earlier of (i) the date 32 days
after a Responsible Officer of the Borrowers shall have discovered or should
have discovered such default and (ii) the date 15 days after written
notice has been given to the Borrowers by the Administrative Agent or the
Required Lenders; or

(e)           The
Parent Borrower or any of its Domestic Subsidiaries shall (A) (i) default in
(x) any payment of principal of or interest on any Indebtedness (including,
without limitation, any Material Vehicle Lease Obligation, but excluding the
Loans) in excess of $60,000,000 or (y) in the payment of any Guarantee
Obligation (other than any Guarantee Obligations in respect of Brazilian
Indebtedness in excess of $60,000,000, beyond the period of grace (not to
exceed 30 days), if any, provided in the instrument or agreement under which
such 

 

74

 

Indebtedness or Guarantee Obligation was created; or (ii)
default in the observance or performance of any other agreement or condition
relating to any Indebtedness (including, without limitation, any Material
Vehicle Lease Obligation, but excluding the Loans and excluding any Brazilian
Indebtedness) or Guarantee Obligation, other than any Guarantee Obligation s in
respect of the Brazilian Indebtedness) referred to in clause (i) above 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
holders of such Indebtedness or beneficiary or beneficiaries of such Guarantee
Obligation (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice or lapse of
time if required, such Indebtedness to become due prior to its stated maturity
or such Guarantee Obligation to become payable (an “Acceleration”), and
such time shall have lapsed and, if any notice (a “Default Notice”)
shall be required to commence a grace period or declare the occurrence of an
event of default before notice of Acceleration may be delivered, such Default
Notice shall have been given or (B) default in the observance or performance of
any agreement or condition (other than as referred to in clause (A)(i) above)
relating to any Material Vehicle Lease Obligation referred to in clause (A)(i)
above, and the lessor thereunder or its permitted assignee shall have
terminated such Material Vehicle Lease Obligation, and such termination shall
have caused an “amortization event” (or similar event however denominated)
under the Special Purpose Financing to which such Material Vehicle Lease
Obligation relates provided, however, that,
no Default or Event of Default shall be deemed to occur (i) if such default
arises under the Existing Facilities and is a default based upon the breach of
a financial covenant or financial covenants thereunder and such default is
cured or waived by the holders of the applicable Existing Facilities, in each
case prior to the earliest of (a) ten (10) Business Days after the occurrence
of such default, (b) acceleration of the indebtedness under the applicable
Existing Facility and (c) termination of the commitments under the applicable
Existing Facility, (ii) if such default is a default based upon the breach of a
negative covenant or negative covenants under the Existing Facilities or arises
as a cross-default to the occurrence of a default under another facility,
including any Material Vehicle Obligation, and, in either case, such default is
cured or waived by the holders of the applicable facility, in each case prior
to the earliest of (a) twenty (20) Business Days after the occurrence of such
default, (b) acceleration of the indebtedness or the occurrence of an
“amortization event” (or similar event however denominated) under the
applicable facility and (c) termination of the commitments under the applicable
facility, and (iii) in the case of any other default, until such time as any
applicable grace period (not to exceed 30 days) has expired in accordance with
the terms of the relevant facility agreements;
or

(f)            Any
Foreign Subsidiary shall (i) default in (x) any payment of principal of or
interest on any Indebtedness (including, without limitation, any Material
Vehicle Lease Obligation, but excluding the Loans) in excess of $75,000,000 or
(y) in the payment of any Guarantee Obligation in excess of $75,000,000, or
(ii) default in the observance or performance of any other agreement or
condition relating to any Indebtedness (including, without limitation, any
Material Vehicle Lease Obligation, but excluding the Loans) or Guarantee
Obligation referred to in clause (i) above, 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, with the giving of notice or lapse of time if required,
such

 

75

 

 Indebtedness or such
Guarantee Obligation to become due and payable before its stated maturity or
before its regularly scheduled dates of payment; or

(g)           If
(i) any Loan Party or any Material Subsidiaries of the Parent Borrower 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, interim receiver, receivers,
receiver and manager, trustee, custodian, conservator or other similar official
for it or for all or any substantial part of its assets, or any Loan Party or any
Material Subsidiaries of the Parent Borrower shall make a general assignment
for the benefit of its creditors; or (ii) there shall be commenced against any
Loan Party or any Material Subsidiaries of the Parent Borrower any case,
proceeding or other action of a nature referred to in clause (i) above which
(A) results in the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged, unstayed or unbonded for
a period of 60 days; or (iii) there shall be commenced against any Loan Party
or any Material Subsidiaries of the Parent Borrower 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 which
results in the entry of an order for any such relief which shall not have been
vacated, discharged, stayed or bonded pending appeal within 60 days from the
entry thereof; or (iv) any Loan Party or any Material Subsidiaries of the
Parent Borrower shall take any corporate 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 Loan Party or any
Material Subsidiaries of the Parent Borrower shall be generally unable to, or
shall admit in writing its general inability to, pay its debts as they become
due; or

(h)           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 either of the Parent Borrower 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 Administrative Agent 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
other than a standard termination pursuant to Section 4041(b) of ERISA,
(v) either of the Parent Borrower or any Commonly Controlled Entity shall,
or in the reasonable opinion of the Administrative Agent is reasonably 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, if any, could be reasonably expected to result
in a Material Adverse Effect; or

(i)            One
or more judgments or decrees shall be entered against the Parent Borrower or
any of its Subsidiaries involving in the aggregate at any time a liability (net
of any 

 

76

insurance or indemnity payments actually received in respect
thereof prior to or within 60 days from the entry thereof, or to be received in
respect thereof in the event any appeal thereof shall be unsuccessful) of
$50,000,000 or more, and all such judgments or decrees shall not have been
vacated, discharged, stayed or bonded pending appeal within 60 days from the
entry thereof; or

(j)            Any
of the Security Documents shall cease for any reason to be in full force and
effect (other than pursuant to the terms hereof or thereof), or any Loan Party
which is a party to any of the Security Documents shall so assert in writing,
or (ii) the Lien created by any of the Security Documents shall cease to be
perfected and enforceable in accordance with its terms or of the same effect as
to perfection and priority purported to be created thereby with respect to any
significant portion of the Collateral (other than in connection with any
termination of such Lien in respect of any Collateral as permitted hereby or by
any Security Document), and such failure of such Lien to be perfected and
enforceable with such priority shall have continued unremedied for a period of
20 days; or

(k)           Any
Loan Document (other than this Agreement or any of the Security Documents)
shall cease for any reason to be in full force and effect (other than pursuant
to the terms hereof or thereof) or any Loan Party shall so assert in writing;
or

(l)            A
Change of Control shall have occurred;

then, and in any such event, (A) if such
event is an Event of Default specified in clause (i) or (ii) of paragraph (g)
above with respect to any Borrower, automatically the Revolving Facility
Commitments, if any, shall immediately terminate and the Loans hereunder (with
accrued interest thereon) and all other amounts owing under this Agreement
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 Parent Borrower, declare the
Revolving Facility Commitments to be terminated forthwith, whereupon the
Revolving Facility Commitments, if any, 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 Parent Borrower, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement to be due and payable
forthwith, whereupon the same shall immediately become due and payable.

Except as
expressly provided above in this Section 9, presentment, demand, protest and
all other notices of any kind are hereby expressly waived.

SECTION 10.  THE AGENTS AND THE OTHER REPRESENTATIVES.

10.1         Appointment.  Each Lender hereby irrevocably designates and
appoints the Agents as the agents of such Lender under this Agreement and the
other Loan Documents, and each such Lender irrevocably authorizes each 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 or required of such Agent by
the terms of this Agreement and the other Loan Documents, together with such
other powers as

 

77

are reasonably incidental thereto.  Notwithstanding any provision to the contrary
elsewhere in this Agreement, the Agents shall not have any duties or
responsibilities, except, in the case of the Administrative Agent, the Domestic
Collateral Agent and the PRUSVI Collateral Agent, those expressly set forth
herein or in any other Loan Document, 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 any Agent or the Other
Representatives.  Each of the Agents may
perform any of their respective duties under this Agreement, the other Loan
Documents and any other instruments and agreements referred to herein or
therein by or through its respective officers, directors, agents, employees or
Affiliates (it being understood and agreed, for avoidance of doubt and without
limiting the generality of the foregoing, that the Administrative Agent, the
Domestic Collateral Agent and the PRUSVI Collateral Agent may perform any of
their respective duties under the Security Documents by or through one or more
of their respective Affiliates).

10.2         Delegation
of Duties.  In performing its
functions and duties under this Agreement, each Agent shall act solely as agent
for the Lenders and, as applicable, the other Secured Parties, and no Agent
assumes any (and shall not be deemed to have assumed any) obligation or
relationship of agency or trust with or for Borrowers or any of their
respective Subsidiaries.  Each 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.  No Agent shall be responsible for the
negligence or misconduct of any agents or attorneys-in-fact or counsel selected
by it with reasonable care.

10.3         Exculpatory
Provisions.  None of the Agents nor
any of their officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (a) liable for any action taken or omitted to be taken by
such Person under or in connection with this Agreement or any other Loan
Document (except for the gross negligence or willful misconduct of such Person
or any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates) or (b) responsible in any manner to any of the Lenders for (i)
any recitals, statements, representations or warranties made by any Borrower or
any other 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, (ii) for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any Notes or any other Loan Document, (iii) for any failure
of any Borrower or any other Loan Party to perform its obligations hereunder or
under any other Loan Document, (iv) the performance or observance of any of the
terms, provisions or conditions of this Agreement or any other Loan Document,
(v) the satisfaction of any of the conditions precedent set forth in Section 6,
or (vi) the existence or possible existence of any Default or Event of
Default.  No Agent shall 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 Borrower or any other Loan Party.  Each Lender agrees that, except for notices,
reports and other documents expressly required to be furnished to the Lenders
by the Administrative Agent hereunder or given to the Agents for the account of
or with copies for the Lenders, the Agents 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), 

 

78

 

prospects or creditworthiness of any Borrower or any other
Loan Party which may come into the possession of the Agents or any of their officers,
directors, employees, agents, attorneys-in-fact or Affiliates.

10.4         Reliance
by Agents.  Each Agent shall be
entitled to rely, and shall be fully protected (and shall have no liability to
any Person) in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telecopy, telex or teletype message, 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 any
Borrower), independent accountants and other experts selected by each
Agent.  The Agents may deem and treat the
payee of any Note as the owner thereof for all purposes unless such Note shall
have been transferred in accordance with subsection 11.6 and all actions
required by such Section in connection with such transfer shall have been
taken.  Any request, authority or consent
of any Person or entity who, at the time of making such request or giving such
authority or consent, is the holder of any Note shall be conclusive and binding
on any subsequent holder, transferee, assignee or endorsee, as the case may be,
of such Note or of any Note or Notes issued in exchange therefor.  Each Agent shall be fully justified as
between itself and the Lenders 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 and/or such other requisite
percentage of the Lenders as is required pursuant to subsection 11.1(a) as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it
by reason of taking or continuing to take any such action.  Each Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and any
Notes and the other Loan Documents in accordance with a request of the Required
Lenders and/or such other requisite percentage of the Lenders as is required
pursuant to subsection 11.1(a), 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.

10.5         Notice
of Default.  No Agent shall be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received notice from a
Lender, any other Agent or any 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 prompt notice thereof to the Lenders and each of the other Agents.  The Agents shall take such action reasonably
promptly with respect to such Default or Event of Default as shall be directed
by the Required Lenders and/or such other requisite percentage of the Lenders
as is required pursuant to subsection 11.1(a); provided that unless and
until the Agents shall have received such directions, the Agents 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.

10.6         Acknowledgements
and Representations by Lenders.  Each
Lender expressly acknowledges that none of the Agents or the Other
Representatives nor any of their officers, directors, employees, agents,
attorneys-in-fact or Affiliates has made any representations or warranties to
it and that no act by any Agent or any Other Representative hereafter taken,
including any review of the affairs of any Borrowers or any other Loan Party, 

 

79

 

shall be deemed to constitute any representation or warranty
by such Agent or such Other Representative to any Lender.  Each Lender represents to the Agents, the
Other Representatives and each of the Loan Parties that, independently and
without reliance upon the any Agent, the Other Representatives or any other
Lender, and based on such documents and information as it has deemed
appropriate, it has made and will make, its own appraisal of and investigation
into the business, operations, property, financial and other condition and
creditworthiness of the Borrowers and the other Loan Parties, it has made its
own decision to make its Loans hereunder and enter into this Agreement and it
will make its own decisions in taking or not taking any action under this
Agreement and the other Loan Documents and, except as expressly provided in
this Agreement, neither the Agents nor any Other Representative shall have any
duty or responsibility, either initially or on a continuing basis, to provide
any Lender or the holder of any Note with any credit or other information with
respect thereto, whether coming into its possession before the making of the
Loans or at any time or times thereafter. 
Each Lender represents to each other party hereto that it is a bank, savings
and loan association or other similar savings institution, insurance company,
investment fund or company or other financial institution which makes or
acquires commercial loans in the ordinary course of its business, that it is
participating hereunder as a Lender for such commercial purposes, and that it
has the knowledge and experience to be and is capable of evaluating the merits
and risks of being a Lender hereunder. 
Each Lender acknowledges and agrees to comply with the provisions of
subsection 11.6 applicable to the Lenders hereunder.

10.7         Indemnification.  The Lenders agree to indemnify each Agent (or
any Affiliate thereof) (to the extent not reimbursed by the Borrowers or any
other Loan Party and without limiting the obligation of the Borrowers to do
so), ratably according to their respective Revolving Facility Commitment
Percentages in effect on the date on which indemnification is sought under this
subsection (or, if indemnification is sought after the date upon which the
Revolving Facility Commitments shall have terminated and the Loans shall have
been paid in full, ratably in accordance with their Revolving Facility
Commitment 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 which
may at any time (including at any time following the payment of the Loans) be
imposed on, incurred by or asserted against such Agent (or any Affiliate thereof)
in any way relating to or arising out of this Agreement, any of the other Loan
Documents or the transactions contemplated hereby or thereby or any action
taken or omitted by any Agent (or any Affiliate thereof) 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 to the
extent arising from (a) such Agent’s gross negligence or willful misconduct or
(b) claims made or legal proceedings commenced against such Agent by any
security holder or creditor thereof arising out of and based upon rights
afforded any such security holder or creditor solely in its capacity as such.  The agreements in this subsection shall
survive the payment of the Loans and all other amounts payable hereunder.

(a)           Any
Agent shall be fully justified in failing or refusing to take any action
hereunder and under any other Loan Document (except actions expressly required
to be taken by it hereunder or under the Loan Documents) unless it shall first
be indemnified to its satisfaction by the Lenders pro rata against any and all liability, cost and expense that it may
incur by reason of taking or continuing to take any such action.

 

80

 

(b)           The
agreements in this subsection 10.7 shall survive the payment of all Borrower
Obligations and Guaranteed Obligations (each as defined in the Domestic
Guarantee and Collateral Agreement).

10.8         Agents
and Other Representatives in Their Individual Capacity.  Each Agent, the Other Representatives and
their Affiliates may make loans to, accept deposits from and generally engage
in any kind of business with any Borrower or any other Loan Party as though
such Agent and the Other Representatives were not an Agent or the Other
Representatives hereunder and under the other Loan Documents.  With respect to Loans made or renewed by them
and any Note issued to them, each Agent and the Other Representatives 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 they were not an
Agent or an Other Representative, and the terms “Lender” and “Lenders” shall
include the Agents and the Other Representatives in their individual Lender
capacities.

10.9         Collateral
Matters.  (a)  Each Lender authorizes and directs each of
the Domestic Collateral Agent and the PRUSVI Collateral Agent, as applicable,
to enter into the Security Documents for the benefit of the Lenders and the
other Secured Parties.  Each Lender
hereby agrees, and each holder of any Note by the acceptance thereof will be
deemed to agree, that, except as otherwise set forth herein, any action taken
by any of the Agents or the Required Lenders in accordance with the provisions
of this Agreement or the Security Documents, and the exercise by the Agents or
the Required Lenders of the powers set forth herein or therein, together with
such other powers as are reasonably incidental thereto, shall be authorized and
binding upon all of the Lenders.  Each of
the Agents is hereby authorized on behalf of all of the Lenders, without the
necessity of any notice to or further consent from any Lender, from time to
time, to take any action with respect to any Collateral or Security Documents
which may be necessary to perfect and maintain perfected the security interest
in and liens upon the Collateral granted pursuant to the Security Documents.

(b)           The
Lenders hereby authorize the Administrative Agent, the Domestic Collateral
Agent and the PRUSVI Collateral Agent, as applicable, in each case at its
option and in its discretion, to release any Lien granted to or held by such
Agent upon any Collateral (i) upon termination of the Revolving Facility
Commitments and payment and satisfaction of all of the obligations under the
Loan Documents at any time arising under or in respect of this Agreement or the
Loan Documents or the transactions contemplated hereby or thereby, (ii) constituting
property being sold or otherwise disposed of (to Persons other than a Loan
Party) upon the sale or other disposition thereof in compliance with subsection
8.3, (iii) if approved, authorized or ratified in writing by the Required
Lenders (or such greater amount, to the extent required by subsection 11.1),
(iv) in connection with the granting of Liens thereon in favor of another
Person in compliance with subsection 8.1(i), or (v) as otherwise may be
expressly provided in the relevant Security Documents.  Upon request by the Administrative Agent, the
Domestic Collateral Agent or the PRUSVI Collateral Agent, at any time, the
Lenders will confirm in writing such Agent’s authority to release particular
types or items of Collateral pursuant to this subsection 10.9.

(c)           No
Agent shall have any obligation whatsoever to the Lenders to assure that the
Collateral exists or is owned by a Borrower or is cared for, protected or
insured or that 

 

81

the Liens granted to any Agent herein or pursuant hereto have
been properly or sufficiently or lawfully created, perfected, protected or
enforced or are entitled to any particular priority, or to exercise or to
continue exercising at all or in any manner or under any duty of care,
disclosure or fidelity any of the rights, authorities and powers granted or
available to the Agents in this subsection 10.9 or in any of the Security
Documents, it being understood and agreed that in respect of the Collateral, or
any act, omission or event related thereto, each Agent may act in any manner it
may deem appropriate, in its sole discretion, given such Agent’s own interest
in the Collateral as Lender and that no Agent shall have any duty or liability
whatsoever to the Lenders, except for its gross negligence or willful
misconduct.

(d)           Each
of the Domestic Collateral Agent and the PRUSVI Collateral Agent may, and
hereby does, appoint the Administrative Agent as its agent for the purposes of
holding any Collateral and/or perfecting the Collateral Agent’s security
interest therein and for the purpose of taking such other action with respect
to the Collateral as such Agents may from time to time agree.

10.10       Successor
Agent.

(a)           Subject
to the appointment of a successor as set forth herein, the Administrative
Agent, the Domestic Collateral Agent and the PRUSVI Collateral Agent may resign
as Administrative Agent, Domestic Collateral Agent or PRUSVI Collateral Agent,
respectively, upon 10 days’ notice to the applicable Lenders and the Parent Borrower.  If the Administrative Agent or the PRUSVI
Collateral Agent shall resign as Administrative Agent or PRUSVI Collateral
Agent, as applicable, 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 be subject to approval by the Parent
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 or the PRUSVI Collateral Agent, as applicable, and
the term “Administrative Agent” or “PRUSVI Collateral Agent”, as applicable,
shall mean such successor agent effective upon such appointment and approval,
and the former Agent’s rights, powers and duties as Administrative Agent or
PRUSVI Collateral Agent, as applicable, shall be terminated, without any other
or further act or deed on the part of such former Agent or any of the parties
to this Agreement or any holders of the Loans. 
If the Domestic Collateral Agent shall resign as Domestic Collateral
Agent under this Agreement and the other Loan Documents, then the Required
Lenders shall appoint a successor Domestic Collateral Agent for the Lenders,
which successor agent shall be subject to approval by the Parent Borrower
(which approval shall not be unreasonably withheld or delayed), whereupon such
successor agent shall succeed to the rights, powers and duties of the Domestic
Collateral Agent, and the term “Domestic Collateral Agent” shall mean such
successor agent effective upon such appointment and approval, and the former
agent’s rights, powers and duties of the Domestic Collateral Agent shall be
terminated, without any other or further act or deed on the part of the former agent
or any of the parties to this Agreement or any holders of the Loans.  After any retiring Agent’s resignation or
removal as Agent, the provisions of this Section 10 shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Agent under
this Agreement and the other Loan Documents. 
Additionally, after such retiring Agent’s resignation as such Agent, the
provisions of this subsection shall inure to its benefit as to any actions
taken

 

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or omitted to be taken by it while it was such Agent under
this Agreement and the other Loan Documents.

10.11       Other
Representatives.  None of the
entities identified as bookrunners and lead arrangers pursuant to the
definition of Other Representative contained herein, shall have any duties or
responsibilities hereunder or under any other Loan Document in its capacity as
such.

10.12       Reserved.

10.13       Withholding
Tax.  To the extent required by any
applicable law, each Agent may withhold from any payment to any Lender an
amount equivalent to any applicable withholding tax, and in no event shall such
Agent be required to be responsible for or pay any additional amount with
respect to any such withholding.  If the
Internal Revenue Service or any other Governmental Authority asserts a claim
that any Agent did not properly withhold tax from amounts paid to or for the
account of any Lender because the appropriate form was not delivered or was not
properly executed or because such Lender failed to notify such Agent of a
change in circumstances which rendered the exemption from or reduction of
withholding tax ineffective or for any other reason, such Lender shall
indemnify such Agent fully for all amounts paid, directly or indirectly, by
such Agent as tax or otherwise, including any penalties or interest and
together with any expenses incurred.

SECTION 11.  MISCELLANEOUS.

11.1         Amendments
and Waivers.  (a)  Neither this Agreement nor any other Loan
Document, nor any terms hereof or thereof, may be amended, supplemented,
modified or waived except in accordance with the provisions of this subsection
11.1.  The Required Lenders may, or, with
the written consent of the Required Lenders, the Administrative Agent (and the Domestic
Collateral Agent or the PRUSVI Collateral Agent, as applicable) may, from time
to time, (x) enter into with the respective Loan Parties hereto or
thereto, as the case may be, written amendments, supplements or modifications
hereto and to the other Loan Documents for the purpose of adding any provisions
to this Agreement or to the other Loan Documents or changing, in any manner the
rights or obligations of the Lenders or the Loan Parties hereunder or
thereunder or (y) waive at any Loan Party’s request, on such terms and
conditions as the Required Lenders or the Administrative Agent (or the Domestic
Collateral Agent or the PRUSVI Collateral Agent, as applicable), 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:

(i)            reduce
or forgive the amount or extend the scheduled date of maturity of any Loan or
of any scheduled installment thereof or reduce the stated rate of any interest,
commission or fee payable hereunder (other than as a result of any waiver of
the applicability of any post-default increase in interest rates) or extend the
scheduled date of any payment thereof or increase the amount or extend the
expiration date of any Lender’s Revolving Facility Commitment or change the
currency in which any Loan is payable, in each case without the consent of each
Lender directly affected thereby (it being understood that waivers

 

83

 

or modifications of conditions precedent, covenants,
Defaults or Events of Default or of a mandatory reduction in the aggregate
Revolving Facility Commitment of all Lenders shall not constitute an increase
of the Revolving Facility Commitment of any Lender, and that an increase in the
available portion of any Revolving Facility Commitment of any Lender shall not
constitute an increase in the Revolving Facility Commitment of such Lender);

(ii)           amend, modify or waive any provision of this subsection
11.1(a) or reduce the percentage specified in the definition of Required
Lenders, or consent to the assignment or transfer by the Parent Borrower or
Puerto Ricancars of any of its rights and obligations under this Agreement and
the other Loan Documents (other than pursuant to subsection 8.2 or 11.6(a)), in
each case without the written consent of all the Lenders;

(iii)          release any Guarantor under any Security Document, or, in
the aggregate (in a single transaction or a series of related transactions),
all or substantially all of the Collateral without the consent of all of the
Lenders, except as expressly permitted hereby or by any Security Document (as
such documents are in effect on the date hereof or, if later, the date of
execution and delivery thereof in accordance with the terms hereof);

(iv)          require any Lender to make Loans having an Interest Period
of longer than six months without the consent of such Lender; or

(v)           amend,
modify or waive any provision of Section 10 without the written consent of the
then Agents affected thereby.

(b)           Any
waiver and any amendment, supplement or modification pursuant to this
subsection 11.1 shall apply to each of the Lenders and shall be binding upon
the Loan Parties, the Lenders, the Agents and all future holders of the
Loans.  In the case of any waiver, each
of the Loan Parties, the Lenders and the Agents 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.

(c)           Notwithstanding
any provision herein to the contrary, this Agreement may be amended (or amended
and restated) with the written consent of the Required Lenders, the
Administrative Agent and the Borrowers (x) to add one or more additional credit
facilities to this Agreement and to permit the extensions of credit from time
to time outstanding thereunder and the accrued interest and fees in respect
thereof to share ratably in the benefits of this Agreement and the other Loan
Documents with the existing Facilities and the accrued interest and fees in
respect thereof, (y) to include, as appropriate, the Lenders holding such
credit facilities in any required vote or action of the Required Lenders or of
the Lenders and (z) to provide class protection for any additional credit
facilities in a manner consistent with those provided the original Facilities
pursuant to the provisions of subsection 11.1(a) as originally in effect.

 

84

 

(d)           If,
in connection with any proposed change, waiver, discharge or termination of or
to any of the provisions of this Agreement and/or any other Loan Document as
contemplated by subsection 11.1(a), the consent of each Lender or each affected
Lender, as applicable, is required and the consent of the Required Lenders at
such time is obtained but the consent of one or more of such other Lenders
whose consent is required is not obtained (each such other Lender, a “Non-Consenting
Lender”) then the Parent Borrower may, on ten Business Days’ prior written
notice to the Administrative Agent and the Non-Consenting Lender, replace such
Non-Consenting Lender by causing such Lender to (and such Lender shall be
obligated to) assign pursuant to Section 11.6 (with the assignment fee and any
other reasonable out-of-pocket costs and expenses to be paid by the Parent
Borrower in such instance) all of its rights and obligations under this
Agreement to one or more assignees; provided that neither the Administrative
Agent nor any Lender shall have any obligation to the Parent Borrower to find a
replacement Lender; provided, further, that the applicable assignee shall have
agreed to the applicable change, waiver, discharge or termination of  this Agreement and/or the other Loan
Documents; and provided, further, that all obligations of the Borrowers owing
to the Non-Consenting Lender relating to the Loans and participations so
assigned shall be paid in full by the assignee Lender to such Non-Consenting
Lender concurrently with such Assignment and Acceptance.  In connection with any such replacement under
this subsection 11.1(d), if the Non-Consenting Lender does not execute and
deliver to the Administrative Agent a duly completed Assignment and Acceptance
and/or any other documentation necessary to reflect such replacement within a
period of time deemed reasonable by the Administrative Agent after the later of
(a) the date on which the replacement Lender executes and delivers such
Assignment and Acceptance and/or such other documentation and (b) the date as
of which all obligations of the Borrowers owing to the Non-Consenting Lender
relating to the Loans and participations so assigned shall be paid in full by
the assignee Lender to such Non-Consenting Lender, then such Non-Consenting
Lender shall be deemed to have executed and delivered such Assignment and
Acceptance and/or such other documentation as of such date and the applicable
Borrower shall be entitled (but not obligated) to execute and deliver such
Assignment and Acceptance and/or such other documentation on behalf of such
Non-Consenting Lender.

11.2         Notices.  (a)  All
notices, requests, and demands to or upon the respective parties hereto to be
effective shall be in writing (including telecopy), and, unless otherwise
expressly provided herein, shall be deemed to have been duly given or made when
delivered by hand, or three days after being deposited in the mail, postage
prepaid, or, in the case of telecopy notice, when received, or, in the case of
delivery by a nationally recognized overnight courier, when received, addressed
as follows in the case of the Borrowers, the Administrative Agent the Domestic
Collateral Agent and the PRUSVI Collateral Agent, and as set forth in Schedule
A in the case of the other parties hereto, or to such other address as may be
hereafter notified by the respective parties hereto and any future holders of
the Loans:

The Borrowers:                                                                                                                                                              The Hertz
Corporation

225 Brae Boulevard

Park Ridge, NJ 07656

Attention:  Chief Financial Officer

Facsimile: 201-307-2324

Telephone: 201-307-2000

 

85

 

 

	
  with copies to:

  	
   

  	
  The Hertz Corporation

  
	
   

  	
   

  	
  225 Brae Boulevard

  
	
   

  	
   

  	
  Park Ridge, NJ 07656

  
	
   

  	
   

  	
  Attention: General Counsel

  
	
   

  	
   

  	
  Facsimile: 201-594-3122

  
	
   

  	
   

  	
  Telephone: 207-307-2000

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Debevoise & Plimpton
  LLP

  
	
   

  	
   

  	
  919 Third Avenue

  
	
   

  	
   

  	
  New York, New York 10022

  
	
   

  	
   

  	
  Attention:  William
  B. Beekman, Esq.

  
	
   

  	
   

  	
  Facsimile:  (212)
  521-8813

  
	
   

  	
   

  	
  Telephone:  (212)
  909-6215

  
	
   

  	
   

  	
   

  
	
  The
  Administrative Agent/

  	
   

  	
  Gelco
  Corporation

  
	
  the Domestic Collateral
  Agent/

  	
   

  	
  c/o GE Corporate Financial
  Services

  
	
  the PRUSVI Collateral
  Agent:

  	
   

  	
  201 Merritt 7

  
	
   

  	
   

  	
  Norwalk, Connecticut
  06856-5201

  
	
   

  	
   

  	
  Attention: Operations Site
  Leader-2nd Floor

  
	
   

  	
   

  	
  Tel: 203-956-4146

  
	
   

  	
   

  	
  Fax: 203-229-5788

  
	
   

  	
   

  	
   

  
	
  with a copies to:

  	
   

  	
  GE Commercial Finance,
  Fleet Services

  
	
   

  	
   

  	
  3 Capital Drive

  
	
   

  	
   

  	
  Eden Prairie, Minnesota
  55344

  
	
   

  	
   

  	
  Attention: Loan Operations
  Leader

  
	
   

  	
   

  	
  Tel: 952-828-1000

  
	
   

  	
   

  	
  Fax: 952-903-8613

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  and

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Winston & Strawn LLP

  
	
   

  	
   

  	
  200 Park Avenue

  
	
   

  	
   

  	
  New York, New York 10166

  
	
   

  	
   

  	
  Attention: William D.
  Brewer, Esq.

  
	
   

  	
   

  	
  Facsimile: (212) 294-4700

  
	
   

  	
   

  	
  Telephone: (212) 294-6793

  

 

provided that any notice, request or demand to or
upon the Administrative Agent or the Lenders pursuant to subsection 2.7, 3.2,
4.2, 4.4 or 4.8 shall not be effective until received.

(b)           Without
in any way limiting the obligation of any Loan Party and its Subsidiaries to
confirm in writing any telephonic notice permitted to be given hereunder, the
Administrative Agent may prior to receipt of written confirmation act without
liability upon the basis of such telephonic notice, believed by the
Administrative Agent in good faith to be from a Responsible Officer.

 

86

 

11.3         No
Waiver; Cumulative Remedies.  No
failure to exercise and no delay in exercising, on the part of any Agent, any
Lender or any Loan Party, 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.

11.4         Survival
of Representations and Warranties. 
All representations and warranties made hereunder and in the other Loan
Documents (or in any amendment, modification or supplement hereto or thereto)
and in any certificate delivered pursuant hereto or such other Loan Documents
shall survive the execution and delivery of this Agreement and the making of
the Loans hereunder.

11.5         Payment
of Expenses and Taxes.  The Parent
Borrower agrees (a) to pay or reimburse
the Agents and the Other Representatives for (1) all their reasonable
out-of-pocket costs and expenses incurred in connection with (i) the
syndication of the Facilities and the 
development, preparation, execution and delivery 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, (ii) the
consummation and administration of the transactions (including the syndication
of the Revolving Facility Commitments) contemplated hereby and thereby and
(iii) efforts to monitor the Loans and verify, protect, evaluate, assess,
appraise, collect, sell, liquidate or otherwise dispose of any of the Facility
Assets, and (2) (i) the reasonable fees and disbursements of Winston &
Strawn LLP, and such other special or local counsel, consultants, advisors, appraisers
and auditors of the Administrative Agent whose retention (other than during the
continuance of an Event of Default) is approved by the Parent Borrower,  (b) to
pay or reimburse each Lender, the Arrangers and the Agents for all their
reasonable costs and expenses incurred in connection with the enforcement or
preservation of any rights under this Agreement, the other Loan Documents and
any other documents prepared in connection herewith or therewith, including the
fees and disbursements of counsel to the Agents and the Lenders, (c) to pay, indemnify, or reimburse each Lender,
the Arrangers and the Agents for, and hold each Lender, the Arrangers and the
Agents 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 other similar taxes, if any, which may be payable or determined to
be payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and (d) to pay, indemnify or reimburse each Lender,
the Arrangers, each Agent, their respective affiliates, and their respective
officers, directors, trustees, employees, shareholders, members, attorneys and
other advisors, agents and controlling persons (each, an “Indemnitee”)
for, and hold each 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 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 the Parent Borrower, Puerto Ricancars of any of
their Subsidiaries 

 

87

or any of the property of the Parent Borrower, Puerto
Ricancars  or any of their Subsidiaries
(all the foregoing in this clause (d), collectively, the “Indemnified
Liabilities”), provided that the Parent Borrower and Puerto
Ricancars shall not have any obligation hereunder to the Administrative Agent,
the Arranger, any other Agent or any Lender with respect to indemnified liabilities
arising from (i) the gross negligence or willful misconduct of the
Administrative Agent, any other Agent, the Arranger or any such Lender (or any
of their respective directors, trustees, officers, employees, agents,
successors and assigns) or (ii) claims made or legal proceedings commenced
against the Administrative Agent, any other Agent, the Arranger, or any such
Lender by any security holder or creditor thereof arising out of and based upon
rights afforded any such security holder or creditor solely in its capacity as
such.  No Indemnitee shall be liable for
any consequential or punitive damages in connection with the Facilities.  All amounts due under this Section shall be
payable not later than 30 days after written demand therefor.  Statements reflecting amounts payable by the
Loan Parties pursuant to this Section shall be submitted to the address of the
Parent Borrower set forth in subsection 11.2, or to such other Person or
address as may be hereafter designated by the Parent Borrower in a notice to
the Administrative Agent. 
Notwithstanding the foregoing, except as provided in clauses (b) and (c)
above, the Parent Borrower and Puerto Ricancars shall have no obligation under
this subsection 11.5 to any Indemnitee with respect to any tax, levy, impost,
duty, charge, fee, deduction or withholding imposed, levied, collected,
withheld or assessed by any Governmental Authority.  The agreements in this Section shall survive
repayment of the Loans and all other amounts payable hereunder.

11.6         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, except that (i) other than in accordance with subsection 8.2,
none of the Loan Parties may 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 any Loan Party 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 other than a Conduit Lender may, in the
ordinary course of business and in accordance with applicable law, assign to
one or more assignees (each, an “Assignee”) all or a portion of its
rights and obligations under this Agreement (including its Revolving Facility
Commitment and/or Loans, pursuant to an Assignment and Acceptance,
substantially in the form of Exhibit F) with the prior written consent (such
consent not to be unreasonably withheld or delayed) of:

(A)                              The Parent Borrower, provided that no consent of the
Parent 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 subsection 9(a) or (f) has occurred and is continuing, any other Person; provided, further, that if any Lender assigns
all or a portion of its rights and obligations under this Agreement to one of
its affiliates in connection with or in contemplation of the sale or other
disposition of its interest in such 

 

88

 

affiliate, the Parent Borrower’s prior written consent
shall be required for such assignment; and

(B)                                the Administrative Agent, provided that no consent of
the Administrative Agent shall be required for an assignment to a Lender or an
affiliate of a Lender.

(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 Revolving Facility Commitments or Loans, the amount
of the Revolving Facility Commitments or Loans of the assigning Lender subject
to each such assignment (determined as of the date the Assignment and
Acceptance with respect to such assignment is delivered to the Administrative
Agent) shall not be less than $5,000,000 unless the Parent Borrower and the
Administrative Agent otherwise consent, provided that (1) no such
consent of the Parent Borrower shall be required if an Event of Default under
subsection 9(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 Acceptance, together with a
processing and recordation fee of $3,500; provided that for concurrent
assignments to two or more Approved Funds such assignment fee shall only be
required to be paid once in respect of and at the time of such assignments; 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 subsection 11.6, the term “Approved Fund” has the following
meaning:  ”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 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 Acceptance, the Assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Acceptance, 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 

 

89

 

Acceptance, be released from its obligations under
this Agreement (and, in the case of an Assignment and Acceptance 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 (and bound by any related obligations under) subsections 4.10,
4.11, 4.12, 4.13 and 11.5).  Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this subsection 11.6 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 subsection.

(iv)          The Borrowers hereby designate the Administrative Agent,
and the Administrative Agent agrees, to serve as the Borrowers’ agent, solely
for purposes of this subsection 11.6, to maintain at one of its offices in New
York, New York, Norwalk, Connecticut or Eden Prairie, Minnesota, a copy of each
Assignment and Acceptance delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Revolving Facility Commitments
of, and interest and principal amount of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive absent manifest error, and the Borrowers, the Administrative Agent
and the Lenders shall treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary.  The Register shall be available for
inspection by the Borrowers 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 Acceptance 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)(ii) of this
subsection 11.6 and any written consent to such assignment required by
paragraph (b)(ii) of this subsection 11.6, the Administrative Agent shall
accept such Assignment and Acceptance, record the information contained therein
in the Register and give prompt notice of such assignment and recordation to
the Parent Borrower.  No assignment shall
be effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph.

(vi)          On or prior to the effective date of any assignment
pursuant to this subsection 11.6(b), the assigning Lender shall surrender any
outstanding Notes held by it all or a portion of which are being assigned.  Any Notes surrendered by the assigning Lender
shall be returned by the Administrative Agent to the Parent Borrower marked
“cancelled”.

Notwithstanding
the foregoing, no Assignee, which as of the date of any assignment to it
pursuant to this subsection 11.6(b) would be entitled to receive any greater
payment under subsection 4.10, 4.11 or 11.5 than the assigning Lender would
have been entitled to receive as of such date under such subsections with
respect to the rights assigned, shall be entitled to receive such greater
payments unless the assignment was made after an Event of

 

90

 

Default under subsection 9(a) or (f) has occurred and is continuing or
the Parent Borrower has expressly consented in writing to waive the benefit of
this provision at the time of such assignment.

(c)           (i)  Any Lender other than a Conduit Lender may,
in the ordinary course of its business and in accordance with applicable law,
without the consent of the Parent 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 Revolving Facility 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, (C) such Lender shall remain the holder of any such Loan for
all purposes under this Agreement and the other Loan Documents, and (D) the
Parent Borrower, the Administrative Agent 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
subsection 11.1(a) and (2) directly affects such Participant.  Subject to paragraph (c)(ii) of this
subsection 11.6, each Borrower agrees that each Participant shall be entitled
to the benefits of (and shall have the related obligations under) subsections
4.10, 4.11, 4.12, 4.13 and 11.5 to the same extent as if it were a Lender and
had acquired its interest by assignment pursuant to paragraph (b) of this
subsection.  To the extent permitted by
law, each Participant also shall be entitled to the benefits of subsection
11.7(b) as though it were a Lender, provided that such Participant shall
be subject to subsection 11.7(a) as though it were a Lender.

(ii)           No Loan Party shall be obligated to make any greater payment
under subsection 4.10, 4.11 or 11.5 than it would have been obligated to make
in the absence of any participation, unless the sale of such participation is
made with the prior written consent of the Parent Borrower and the Parent
Borrower expressly waives the benefit of this provision at the time of such
participation.  Any Participant that is
not incorporated under the laws of the United States of America or a state
thereof shall not be entitled to the benefits of subsection 4.11 unless such
Participant complies with subsection 4.11(b) and provides the forms and
certificates referenced therein to the Lender that granted such participation.

(d)           Any
Lender, without the consent of the Parent Borrower or the Administrative Agent,
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 subsection 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 (by foreclosure or otherwise) any such pledgee or Assignee for such
Lender as a party hereto.

 

91

 

(e)           No
assignment or participation made or purported to be made to any Assignee or
Participant shall be effective without the prior written consent of the Parent
Borrower if it would require the Parent Borrower or Puerto Ricancars to make
any filing with any Governmental Authority or qualify any Loan or Note under
the laws of any jurisdiction, and the Parent Borrower shall be entitled to
request and receive such information and assurances as it may reasonably
request from any Lender or any Assignee or Participant to determine whether any
such filing or qualification is required or whether any assignment or
participation is otherwise in accordance with applicable law.

(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
Parent Borrower or the Administrative Agent and without regard to the
limitations set forth in subsection 11.6(b). 
Each 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 domestic or foreign bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding under any
state, federal or provincial 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.  Each
such indemnifying Lender shall pay in full any claim received from the Parent
Borrower pursuant to this subsection 11.6(f) within 30 Business Days of receipt
of a certificate from a Responsible Officer of the Parent Borrower specifying
in reasonable detail the cause and amount of the loss, cost, damage or expense
in respect of which the claim is being asserted, which certificate shall be
conclusive absent manifest error. 
Without limiting the indemnification obligations of any indemnifying
Lender pursuant to this subsection 11.6(f), in the event that the indemnifying
Lender fails timely to compensate the Parent Borrower for such claim, any Loans
held by the relevant Conduit Lender shall, if requested by the Parent Borrower,
be assigned promptly to the Lender that administers the Conduit Lender and the
designation of such Conduit Lender shall be void.

(g)           If
the Parent Borrower wishes to replace the Loans or Revolving Facility
Commitments with ones having different terms, it shall have the option, with
the consent of the Administrative Agent and subject to at least three Business
Days’ advance notice to the Lenders, instead of prepaying the Loans or reducing
or terminating the Revolving Facility Commitments to be replaced, to (i) require
the Lenders to assign such Loans or Revolving Facility Commitments to the
Administrative Agent or its designees and (ii) amend the terms
thereof in accordance with subsection 11.1. 
Pursuant to any such assignment, all Loans and Revolving Facility
Commitments to be replaced shall be purchased at par (allocated among the
Lenders in the same manner as would be required if such Loans were being
optionally prepaid or such Revolving Facility Commitments were being optionally
reduced or terminated by the Borrowers), accompanied by payment of any accrued
interest and fees thereon and any amounts owing pursuant to subsection
4.12.  By receiving such purchase price,
the Lenders shall automatically be deemed to have assigned the Loans or
Revolving Facility Commitments pursuant to the terms of the form of Assignment
and Acceptance attached hereto as Exhibit F, and accordingly no other action by
such Lenders shall be required in connection therewith.  The 

 

92

 

provisions of this paragraph are intended to facilitate the
maintenance of the perfection and priority of existing security interests in
the Collateral during any such replacement.

11.7         Adjustments;
Set-off; Calculations; Computations. 
(a)  If any Lender (a “Benefited
Lender”) shall at any time receive any payment of all or part of its
Revolving Credit Loans owing to it, or interest thereon, 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
subsection 9(f), or otherwise (except pursuant to subsection 4.4, 4.13(d) or
11.6)), in a greater proportion than any such payment to or collateral received
by any other Lender, if any, in respect of such other Lender’s Revolving Credit
Loans owing to it, or interest thereon, such Benefited Lender shall purchase
for cash from the other Lenders an interest (by participation, assignment or
otherwise) in such portion of each such other Lender’s Revolving Credit Loans
owing to it, or shall provide such other Lenders with the benefits of any such
collateral, or the proceeds thereof, as shall be necessary to cause such
Benefited Lender to share the excess payment or benefits of such collateral or
proceeds 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 Benefited 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 any Borrower, any such notice
being expressly waived by each Borrower to the extent permitted by applicable
law, upon the occurrence of an Event of Default under subsection 9(a) to
set-off and appropriate and apply against any amount then due and payable under
subsection 9(a) by such Borrower 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 such Borrower.  Each
Lender agrees promptly to notify the Parent Borrower and the Administrative
Agent after any such set-off and application made by such Lender, provided
that the failure to give such notice shall not affect the validity of such
set-off and application.

11.8         Judgment.  (a) 
If, for the purpose of obtaining or enforcing judgment against any Loan
Party in any court in any jurisdiction, it becomes necessary to convert into
any other currency (such other currency being hereinafter in this subsection
11.8 referred to as the “Judgment Currency”) an amount due under any
Loan Document in any currency (the “Obligation Currency”) other than the
Judgment Currency, the conversion shall be made at the rate of exchange
prevailing on the Business Day immediately preceding the date of actual payment
of the amount due, in the case of any proceeding in the courts of any
jurisdiction outside the United States, the Commonwealth of Puerto Rico or the
U.S. Virgin Islands that will give effect to such conversion being made on such
date, or the date on which the judgment is given, in the case of any proceeding
in the courts of any other jurisdiction (the applicable date as of which such
conversion is made pursuant to this subsection 11.8 being hereinafter in this
subsection 11.8 referred to as the “Judgment Conversion Date”).

(b)           If,
in the case of any proceeding in the court of any jurisdiction referred to in
subsection 11.8(a), there is a change in the rate of exchange prevailing
between the Judgment

 

93

 

Conversion Date and the date of actual receipt for value of
the amount due, the applicable Loan Party shall pay such additional amount (if
any, but in any event not a lesser amount) as may be necessary to ensure that
the amount actually received in the Judgment Currency, when converted at the
rate of exchange prevailing on the date of payment, will produce the amount of
the Obligation Currency which could have been purchased with the amount of the
Judgment Currency stipulated in the judgment or judicial order at the rate of
exchange prevailing on the Judgment Conversion Date. Any amount due from any
Loan Party under this subsection 11.8(b) shall be due as a separate debt and
shall not be affected by judgment being obtained for any other amounts due
under or in respect of any of the Loan Documents.

(c)           The
term “rate of exchange” in this subsection 11.8 means the rate of exchange at
which the Administrative Agent, on the relevant date at or about 12:00 noon
(New York time), would be prepared to sell, in accordance with its normal
course foreign currency exchange practices, the Obligation Currency against the
Judgment Currency.

11.9         Counterparts.  This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts
(including by telecopy), and all of such counterparts taken together shall be
deemed to constitute one and the same instrument.  A set of the copies of this Agreement signed
by all the parties shall be delivered to the Parent Borrower and the
Administrative Agent.

11.10       Severability.  Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

11.11       Integration.  This Agreement and the other Loan Documents
represent the entire agreement of each of the Loan Parties party hereto, the
Administrative Agent and the Lenders with respect to the subject matter hereof,
and there are no promises, undertakings, representations or warranties by any
of the Loan Parties party hereto, 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.

11.12       Governing
Law.  THIS AGREEMENT AND ANY NOTES
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND ANY
NOTES SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF NEW YORK.

11.13       Submission To Jurisdiction; Waivers.  Each party hereto hereby irrevocably and
unconditionally:

(i)            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

 

94

 

the United States of America for the Southern District
of New York, and appellate courts from any thereof;

(ii)           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 forum and agrees not to
plead or claim the same;

(iii)          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 the
applicable Borrower the applicable Lender, the Arranger, the Administrative
Agent, the Domestic Collateral Agent or the PRUSVI Collateral Agent, as the
case may be, at the address specified in subsection 11.2 or at such other
address of which the Administrative Agent, the Domestic Collateral Agent, the
PRUSVI Collateral Agent, the Arranger, any such Lender and any such Borrower
shall have been notified pursuant thereto;

(iv)          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

(v)           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 subsection any
consequential or punitive damages.

11.14       Acknowledgements.  Each Borrower 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
any Agent nor any Other Representative or Lender has any fiduciary relationship
with or duty to any Borrower arising out of or in connection with this
Agreement or any of the other Loan Documents, and the relationship between the
Administrative Agent and Lenders, on the one hand, and the Borrowers, on the
other hand, in connection herewith or therewith is solely that of creditor and
debtor; and

(c)           no
joint venture is created hereby or by the other Loan Documents or otherwise
exists by virtue of the transactions contemplated hereby and thereby among the
Lenders or among any of the Borrowers and the Lenders.

11.15       Waiver
Of Jury Trial.  EACH OF THE
BORROWERS, THE AGENTS AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR ANY NOTES OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM
THEREIN.

 

95

 

 

11.16       Confidentiality.  Each Agent and each Lender agrees to keep
confidential any information (a) provided to it by or on behalf of the Parent
Borrower, Puerto Ricancars or any of their respective Subsidiaries pursuant to
or in connection with the Loan Documents or (b) obtained by such Lender based
on a review of the books and records of the Parent Borrower, Puerto Ricancars
or any of their respective Subsidiaries; provided that nothing herein
shall prevent any Lender from disclosing any such information (i) to any Agent,
any Other Representative or any other Lender, (ii) to any Transferee, or
prospective Transferee or any creditor or any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating
to any Borrower and its obligations which agrees to comply with the provisions
of this subsection pursuant to a written instrument (or electronically recorded
agreement from any Person listed above in this clause (ii), which Person has
been approved by the Parent Borrower (such approval not to be unreasonably
withheld), in respect to any electronic information (whether posted or
otherwise distributed on Intralinks or any other electronic distribution
system)) for the benefit of the Parent Borrower (it being understood that each
relevant Lender shall be solely responsible for obtaining such instrument (or
such electronically recorded agreement)), (iii) to its affiliates and the
employees, officers, directors, agents, attorneys, accountants and other
professional advisors of it and its affiliates, provided that such
Lender shall inform each such Person of the agreement under this subsection
11.16 and take reasonable actions to cause compliance by any such Person
referred to in this clause (iii) with this agreement (including, where
appropriate, to cause any such Person to acknowledge its agreement to be bound
by the agreement under this subsection 11.16), (iv) upon the request or demand
of any Governmental Authority having jurisdiction over such Lender or its
affiliates or to the extent required in response to any order of any court or
other Governmental Authority or as shall otherwise be required pursuant to any
Requirement of Law, provided that such Lender shall, unless prohibited
by any Requirement of Law, notify the Parent Borrower of any disclosure
pursuant to this clause (iv) as far in advance as is reasonably practicable
under such circumstances, (v) which has been publicly disclosed other than in
breach of this Agreement, (vi) in connection with the exercise of any remedy
hereunder, under any Loan Document or under any Interest Rate Protection
Agreement, (vii) in connection with periodic regulatory examinations and
reviews conducted by the National Association of Insurance Commissioners or any
Governmental Authority having jurisdiction over such Lender or its affiliates
(to the extent applicable), (viii) in connection with any litigation to which
such Lender (or, with respect to any Interest Rate Protection Agreement, any
affiliate of any Lender party thereto) may be a party, subject to the proviso
in clause (iv), and (ix) if, prior to such information having been so provided
or obtained, such information was already in an Agent’s or a Lender’s
possession on a non-confidential basis without a duty of confidentiality to any
Borrower being violated.

11.17       USA
Patriot Act Notice.  Each Lender
hereby notifies each Borrower that pursuant to the requirements of the USA
Patriot Act (Title III of Pub.:  107-56 (signed into law October 26,
2001)) (the “Patriot Act”), it is required to obtain, verify, and record
information that identifies each Borrower, which information includes the name
of each Borrower and other information that will allow such Lender to identify
each Borrower in accordance with the Patriot Act, and each Borrower agrees to
provide such information from time to time to any Lender.

11.18       Reserved.

 

96

 

11.19       Several
Liability, Postponement of Subrogation. 
The obligations of the Borrowers hereunder and under the other Loan
Documents shall be several and not joint or joint and several, and, as such,
each Borrower shall be liable only for all of the such obligations of such
Borrower under this Agreement and the other Loan Documents.  To the fullest extent permitted by law the
liability of each Borrower for the obligations under this Agreement and the
other Loan Documents shall be absolute, unconditional and irrevocable, without
regard to (i) the validity or enforceability of this Agreement or any other
Loan Document, any of the obligations hereunder or thereunder or any other
collateral security therefor or guarantee or right of offset with respect
thereto at any time or from time to time held by any applicable Secured Party,
(ii) any defense, set-off or counterclaim (other than a defense of payment or
performance hereunder; provided that no Borrower hereby waives any suit
for breach of a contractual provision of any of the Loan Documents) which may
at any time be available to or be asserted by such other applicable Borrower or
any other Person against any Secured Party or (iii) any other circumstance
whatsoever (with or without notice to or knowledge of such other applicable
Borrower or such Borrower) which constitutes, or might be construed to
constitute, an equitable or legal discharge of such other applicable Borrower
for the obligations hereunder or under any other Loan Document, or of such
Borrower under this Section, in bankruptcy or in any other instance.

 

97

 

 

                                IN WITNESS WHEREOF, each of the
undersigned has caused this Agreement to be duly executed and delivered as of
the date first above written.

 

 

 

	
   

  	
  BORROWERS:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PUERTO
  RICANCARS, INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Elyse Douglas

  	
   

  
	
   

  	
  Name:
  Elyse Douglas

  	
   

  
	
   

  	
  Title:
  Treasurer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  THE
  HERTZ CORPORATION

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Elyse Douglas

  	
   

  
	
   

  	
  Name:
  Elyse Douglas

  	
   

  
	
   

  	
  Title:  Treasurer

  	
   

  

 

 

 

 

	
   

  	
   

  	
   

  	
   

  
	
   

  	
  LENDERS:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  GELCO
  CORPORATION DBA GE FLEET

  SERVICES,
  as Administrative Agent, Domestic Collateral Agent, PRUSVI Collateral Agent
  and

  Lender

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Richard J. Chertiz

  	
   

  
	
   

  	
  Name:
  Richard J. Chertiz

  	
   

  
	
   

  	
  Title:
  Senior Vice President

  	
   

  

 

 

 

 

	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MERRILL
  LYNCH MORTGAGE CAPITAL, INC,

  as
  Lender

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Joseph Magnus

  	
   

  
	
   

  	
  Name:
   Joseph Magnus

  	
   

  
	
   

  	
  Title:
  Vice President

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