  We construct a new Quillen model, based on the notions of Drinfeld's DG
quotient and localization pair, for the Morita homotopy theory of DG
categories. This new Quillen model carries a natural closed symmetric monoidal
structure and allows us to re-interpret Toen's construction of the internal
Hom-functor for the homotopy category of DG categories as a total right derived
internal Hom-functor.
