DIRECT PARENT STOCK PLEDGE AGREEMENT
VCR USA HOLDINGS II INC.
in favor of
GOLDMAN SACHS CREDIT PARTNERS L.P..,
as Administrative Agent
dated as of June 14, 2006
TABLE OF CONTENTS
SECTION 1. DEFINED TERMS
Other Definitional Provisions
SECTION 2. GRANT OF SECURITY INTEREST
Amendments, etc. with respect to the Obligations
Parent' s Obligation Absolute and Unconditional
Limitation on Liability
Waiver of Rights of Reimbursement, Contribution and Subrogation
SECTION 3. REPRESENTATIONS AND WARRANTIES
Corporate Existence; Compliance with Law
Corporate Power; Authorization; Enforceable Obligations
Title; No Other Liens
Perfected First Priority Liens
Jurisdiction of Organization; Chief Executive Office
SECTION 4. COVENANTS
Covenants in Credit Agreement
Delivery of Instruments and Chattel Paper
Payment of Obligations
Maintenance of Perfected Security Interest; Further Documentation
Changes in Name, etc
SECTION 5. REMEDIAL PROVISIONS
Proceeds to be Turned Over To Administrative Agent
Application of Proceeds
Code and Other Remedies
SECTION 6. THE ADMINISTRATIVE AGENT
Administrative Agent' s Appointment as Attorney-in-Fact, etc
Duty of Administrative Agent
Filing of Financing Statements
Authority of Administrative Agent
SECTION 7. MISCELLANEOUS
Amendments in Writing
No Waiver by Course of Conduct; Cumulative Remedies
Enforcement Expenses; Indemnification
Successors and Assigns
Submission To Jurisdiction; Waivers
WAIVER OF JURY TRIAL
Schedule 1 Notice Address of Pledgor
Schedule 2 Description of Pledged Securities
Schedule 3 Jurisdiction of Organization, Identification Number and Location of Chief Executive Office
DIRECT PARENT STOCK PLEDGE AGREEMENT, dated as of June 14, 2006, made by VCR USA HOLDINGS II INC., a Delaware corporation (the " Pledgor" ) in favor of GOLDMAN SACHS CREDIT PARTNERS L.P., (" GSCP" ) as Administrative Agent (in such capacity together with its successors and permitted assigns in such capacity, the " Administrative Agent" ) for the banks and other financial institutions (the " Lenders" ) from time to time parties to the Credit Agreement, dated as of June 14, 2006 (as amended, supplemented or otherwise modified from time to time, the " Credit Agreement" ), among Vanguard Car Rental USA Holdings Inc., a Delaware corporation (the " US Borrower" ), National Car Rental (Canada) Inc., an Canada corporation (the " Canadian Borrower" ), the Administrative Agent, the Lenders, GSCP, J.P. Morgan Securities Inc. and Lehman Brothers Inc., as Sole Joint Lead Arrangers and Joint Bookrunners, GSCP and JP Morgan Chase Bank, N.A., as Co-Syndication Agents, Lehman Commercial Paper Inc., Bank of Montreal and Wachovia Bank, National Association, as Co-Documentation Agents, and Bank of Montreal, as Canadian Agent. Capitalized terms used herein shall have the meanings set forth in Section 1 hereof.
W I T N E S S E T H :
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally agreed to make extensions of credit to the US Borrower and the Canadian Borrower upon the terms and subject to the conditions set forth therein;
WHEREAS, it is a condition precedent to the obligation of the Lenders to make their respective extensions of credit to the US Borrower and the Canadian Borrower under the Credit Agreement that the Pledgor shall have executed and delivered this Agreement to the Administrative Agent;
NOW, THEREFORE, in consideration of these premises and to induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective extensions of credit to the US Borrower and the Canadian Borrower thereunder, the Pledgor hereby agrees with the Administrative Agent, for the benefit of the Secured Parties as follows:
SECTION 1. DEFINED TERMS
1.1 Definitions . Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement and the following terms are used herein as defined in the New York UCC: Accounts, Certificated Security, Chattel Paper, General Intangibles, Instruments and Supporting Obligations.
(a) The following terms shall have the following meanings:
" Agreement" : this Parent Stock Pledge Agreement, as the same may be amended, supplemented or otherwise modified from time to time.
" Borrower Obligations" : the collective reference to the Obligations (as defined in the Credit Agreement).
" Collateral Account" : any collateral account established by the Administrative Agent as provided in Section 5 .2
" Guarantor Obligations" : with respect to any Guarantor, the collective reference to all obligations and liabilities of such Guarantor which may arise under or in connection with the
Guarantee and Collateral Agreement (including, Section 2 thereof) or any other Loan Document to which such Guarantor is a party, in each case whether on account of guarantee obligations, reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including, all reasonable fees and disbursements of counsel to the Administrative Agent or to any Secured Party that are required to be paid by such Guarantor pursuant to the terms of the Guarantee and Collateral Agreement or any other Loan Document).
" Intercompany Note" : any promissory note evidencing loans made by the Pledgor to US Borrower or any of its Subsidiaries.
" New York UCC" : the Uniform Commercial Code as from time to time in effect in the State of New York.
" Obligations" : the collective reference to the Borrower Obligations and the Guarantor Obligations.
" Parent" : VCR USA Holdings II Inc., a Delaware corporation.
" Pledgor" : as defined in the preamble.
" Pledged Collateral" : as defined in Section 2 .
" Pledged Debt" : shall mean all intercompany loans and advances and other forms of indebtedness owed to the Pledgor by the US Borrower or any of its Subsidiaries, whether or not evidenced by an instrument or represented by a security, including, without limitation, all indebtedness described on Schedule 2 under the heading " Pledged Debt" (as such schedule may be amended or supplemented from time to time), issued by the obligors named therein, the instruments (if any) evidencing such indebtedness, and all interest, cash, instruments and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such indebtedness.
" Pledged Securities" : the collective reference to the Pledged Debt and the Pledged Stocks.
" Pledged Stocks" : all equity interests of Capital Stock held by the Pledgor in the US Borrower, as specified on Schedule 2 (as such schedule may be amended or modified from time to time) and the certificates, if any, representing such equity interests and any interest of the Pledgor on the books and records of the US Borrower or on the books and records of any securities intermediary pertaining to such interest and all dividends, distributions, cash, warrants, rights, options, instruments, securities and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such equity interest that may be issued or granted to, or held by, the Pledgor while this Agreement is in effect.
" Proceeds" : all " proceeds" as such term is defined in Section 9-102(a)(64) of the New York UCC and, in any event, including, all dividends or other income from the Pledged Securities, collections thereon or distributions or payments with respect thereto.
" Secured Parties" : the collective reference to the Agents and the Lenders under the Credit Agreement (including any Issuing Lender in its capacity as Issuing Lender) and any Qualified Counterparties and shall include all former Agents, Lenders and Qualified Counterparties to the extent that any Obligations owing to such Persons were incurred while such
Persons were Agents, Lenders or Qualified Counterparties and such Obligations have not been paid or satisfied in full.
" Securities Act" : the Securities Act of 1933, as amended.
" Uniform Commercial Code" : the Uniform Commercial Code as in effect from time to time in any applicable jurisdiction.
1.2 Other Definitional Provisions . The words " hereof," " herein," " hereto" 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 and Schedule references are to this Agreement unless otherwise specified.
(a) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.
(b) References to " Sections," " Exhibits" and " Schedules" shall be to Sections, Exhibits and Schedules, as the case may be, of this Agreement unless otherwise specifically provided. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose or be given any substantive effect.
(c) The use herein of the word " include" or " including" , when following any general statement, term or matter, shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, but rather shall be deemed to refer to all other items or matters that fall within the broadest possible scope of such general statement, term or matter.
(d) If any conflict or inconsistency exists between this Agreement and the Credit Agreement, the Credit Agreement shall govern.
(e) All references herein to provisions of the New York UCC shall include all successor provisions under any subsequent version or amendment to any Article of the New York UCC.
(f) Where the context requires, terms relating to the Pledged Collateral or any part thereof, when used in relation to the Pledgor, shall refer to the Pledgor' s Pledged Collateral or the relevant part thereof.
SECTION 2. GRANT OF SECURITY INTEREST
2.1 Grant . The Pledgor hereby collaterally assigns, transfers and grants to the Administrative Agent, for the ratable benefit of the Secured Parties, a security interest in, all of the following property now owned or at any time hereafter acquired by the Pledgor or in which the Pledgor now has or at any time in the future may acquire any right, title or interest (collectively, the " Pledged Collateral" ), as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Obligations:
(a) all Pledged Stocks;
(b) all Pledged Debt; and
(c) to the extent not otherwise included, all Proceeds and products of any and all of the foregoing, all Supporting Obligations in respect of any of the foregoing and all collateral security and guarantees given by any Person with respect to any of the foregoing.
2.2 Amendments, etc. with respect to the Obligations . The Parent shall remain obligated hereunder notwithstanding that, without any reservation of rights against the US Borrower and without notice to or further assent by the Parent, any demand for payment of any of the Obligations made by the Administrative Agent or any Secured Party may be rescinded by the Administrative Agent or such Secured Party and any of the Obligations continued, and the Obligations, or the liability of any other Person upon or for any part thereof, or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, increased, extended, amended, modified, accelerated, compromised, waived, surrendered or released by the Administrative Agent or any Secured Party, and the Specified Hedge Agreements, the Credit Agreement and the other Loan Documents and any other documents executed and delivered in connection therewith may be amended, modified, supplemented or terminated, in whole or in part, as the Administrative Agent (or the Required Lenders or all Lenders, as the case may be) may deem advisable from time to time, and any collateral security, guarantee or right of offset at any time held by the Administrative Agent or any Secured Party for the payment of the Obligations may be sold, exchanged, waived, surrendered or released. Neither the Administrative Agent nor any Secured Party shall, except to the extent set forth in, and for the benefit of the parties to, the agreements and instruments governing such Lien have any obligation to protect, secure, perfect or insure any Lien at any time held by it as security for the Obligations or for the pledge contained in this Section 2 or any property subject thereto.
2.3 Parent' s Obligation Absolute and Unconditional . The Parent waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations and notice of or proof of reliance by the Administrative Agent or any Secured Party upon the pledge contained in this Section 2 or acceptance of the pledge contained in this Section 2 ; the Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the pledge contained in this Section 2 , and all dealings between the US Borrower and the Parent, on the one hand, and the Administrative Agent and the Secured Parties, on the other hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon the obligation contained in this Section 2 . The Parent waives diligence, presentment, protest and notice of default or nonpayment to or upon the US Borrower or any of the Guarantors with respect to the Obligations. The Parent understands and agrees that the pledge contained in this Section 2 shall be construed as a continuing, absolute and unconditional obligation without regard to (a) the validity or enforceability of the Credit Agreement or any other Loan Document, any of the Obligations or any collateral security therefor or guarantee or right of offset with respect thereto at any time or from time to time held by the Administrative Agent or any Secured Party, (b) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by the US Borrower or any other Person against the Administrative Agent or any Secured Party, or (c) any other circumstance whatsoever (with or without notice to or knowledge of the US Borrower, any Guarantor or the Parent) which constitutes, or might be construed to constitute, an equitable or legal discharge of the US Borrower for the US Obligations or of such Guarantor under the guarantee of such Guarantor contained in Section 2 of the Guarantee and Collateral Agreement or of the Parent for its obligations contained in this Section 2 , in bankruptcy or in any other instance. When making any demand hereunder or otherwise pursuing its rights and remedies hereunder against the Parent, the Administrative Agent or any Secured Party may, but shall be under no obligation to, make a similar demand on or otherwise pursue such rights and remedies as it may have against the US Borrower, any Guarantor or any other Person or against any collateral security or guarantee for the Obligations or any right of offset with respect thereto, and any failure by the Administrative Agent or any Secured Party to make any such demand, to pursue such other rights or
remedies or to collect any payments from the US Borrower, any Guarantor or any other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of the US Borrower, any Guarantor or any other Person or any such collateral security, guarantee or right of offset, shall not relieve the Parent of any obligation or liability under this Section 2 , and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Administrative Agent or any Secured Party against the Parent. For the purposes hereof " demand" shall include the commencement and continuance of any legal proceedings.
2.4 Reinstatement . The pledge contained in this Section 2 shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of any of the Obligations is rescinded or must otherwise be restored or returned by the Administrative Agent or any Secured Party upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the US Borrower, any Guarantor or the Parent, or upon or as a result of the appointment of a receiver, intervener or conservator of, or trustee or similar officer for, the US Borrower, any Guarantor or the Parent or any substantial part of their respective property, or otherwise, all as though such payments had not been made.
2.5 Limitation on Liability . Notwithstanding anything to the contrary in the Credit Agreement, the Notes, this Agreement or the other Security Documents, the following shall apply:
(a) Except to the extent provided in subparagraphs (b), (c), (d) and (e) below, the Pledgor shall not be personally liable for repayment of the Notes or any other sums due under the Credit Agreement, the Notes or the Security Documents or for the payment of any deficiency established following a judicial foreclosure or a non-judicial foreclosure under this Agreement or under any of the other Security Documents, except to the extent of the Pledgor' s interest in the Pledged Collateral and all other collateral given as security for the payment and/or performance by the Pledgor of its obligation under the Credit Agreement, the Notes and the Security Documents, and the sole recourse of the Administrative Agent against the Pledgor for any Event of Default shall be by judicial or non-judicial foreclosure or other remedies set forth in this Agreement or otherwise available at law or in equity;
(b) The limitation of liability set forth in subparagraph (a) above shall be deemed void and shall have no force or effect in the event the Pledgor shall claim that this Agreement, the Credit Agreement, the Notes or any other Security Document is invalid or unenforceable to an extent that would preclude a foreclosure (whether judicial or non-judicial) of the Pledged Collateral or otherwise prevent the Secured Parties from realizing on the Pledged Collateral or any portion thereof by any remedies set forth in the Credit Agreement, the Notes or the Security Documents.
(c) The limitation of liability set forth in subparagraph (a) above shall not prejudice the rights of the Secured Parties to:
(w) Name the Pledgor as a party defendant in any action, proceeding, reference or arbitration, in each case, however, subject to the limitations of subparagraph (a) above;
(x) Assert any unpaid amounts due under the Credit Agreement, the Notes and the Security Documents as a defense or offset to or against any claim or cause of action made or alleged against the Secured Parties by the Pledgor; or
(y) Exercise self-help remedies such as setoff or foreclosure against the Pledged Collateral, or any portion thereof, or any other collateral given as security for the payment and performance obligations of the Pledgor under the Credit Agreement, the Notes and the Security Documents.
(d) The limitation of liability set forth in subparagraph (a) above does not apply to and the Pledgor shall be subject to full personal liability for any and all losses, liabilities, damages, injuries, costs, expenses and claims of any kind whatsoever, incurred or suffered by the Secured Parties or its assignees as a result of any of the following:
(w) the Pledgor' s fraud or intentional misrepresentation by the Pledgor in connection with this Agreement or the Pledged Collateral or other collateral given as security for the payment and performance obligations of the Pledgor under the Credit Agreement, the Notes and the Security Documents;
(x) negligent administration by the Pledgor of Proceeds received after the occurrence of an Event of Default or the failure of the Pledgor to apply said Proceeds to the obligations owing by the Pledgor under this Agreement or to the normal operating expenses of the Pledged Collateral, but