EXECUTION DRAFT
AMERICREDIT RECEIVABLES FINANCE CORP.
8.19% Automobile Receivables-Backed Notes Series 1994-A
INDENTURE
Dated as of December 1, 1994
LaSalle National Bank
Trustee and Indenture Collateral Agent
TABLE OF CONTENTS
Page
ARTICLE I Definitions and Incorporation by Reference . . . . . . . . . . 3
SECTION 1.1. Definitions. . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.2. Rules of Construction. . . . . . . . . . . . . . . . 10
ARTICLE II The Notes . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.1. Form . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.2. Execution, Authentication and Delivery . . . . . . . 11
SECTION 2.3. Temporary Notes. . . . . . . . . . . . . . . . . . . 12
SECTION 2.4. Registration; Registration of Transfer
and Exchange . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.6. Person Deemed Owner. . . . . . . . . . . . . . . . . 14
SECTION 2.7. Payment of Principal and Interest. . . . . . . . . . 15
SECTION 2.8. Cancellation . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.9. Certain Transfer Restrictions. . . . . . . . . . . . 16
ARTICLE III Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.1. Payment of Principal and Interest. . . . . . . . . . 17
SECTION 3.2. Maintenance of Office or Agency. . . . . . . . . . . 17
SECTION 3.3. Money for Payments To Be Held in Trust . . . . . . . 18
SECTION 3.4. Existence. . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.6. Opinions as to Trust Estate. . . . . . . . . . . . . 20
SECTION 3.7. Performance of Obligations; Servicing of
Receivables. . . . . . . . . . . . . . . . . . . . . 21
SECTION 3.8. Negative Covenants . . . . . . . . . . . . . . . . . 22
SECTION 3.9. Annual Statement as to Compliance. . . . . . . . . . 23
SECTION 3.10. Consolidation and Disposition of Assets. . . . . . . 23
SECTION 3.11. Transferee of Issuer . . . . . . . . . . . . . . . . 24
SECTION 3.12. No Other Business. . . . . . . . . . . . . . . . . . 24
SECTION 3.13. No Borrowing . . . . . . . . . . . . . . . . . . . . 24
SECTION 3.14. Servicer's Obligations . . . . . . . . . . . . . . . 24
SECTION 3.15. Guarantees, Loans, Advances and Other
Liabilities. . . . . . . . . . . . . . . . . . . . . 24
SECTION 3.16. Capital Expenditures . . . . . . . . . . . . . . . . 24
SECTION 3.17. Restricted Payments. . . . . . . . . . . . . . . . . 25
SECTION 3.18. Notice of Events of Default. . . . . . . . . . . . . 25
SECTION 3.19. Further Instruments and Acts . . . . . . . . . . . . 25
SECTION 3.20. Compliance with Laws . . . . . . . . . . . . . . . . 25
SECTION 3.21. Amendments of Sale and Servicing
Agreement. . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.22. Income Tax Characterization. . . . . . . . . . . . . 25
ARTICLE IV Satisfaction and Discharge. . . . . . . . . . . . . . . . . . 26
SECTION 4.1. Satisfaction and Discharge of Indenture. . . . . . . 26
SECTION 4.2. Application of Trust Money . . . . . . . . . . . . . 27
SECTION 4.3. Payment of Moneys Held by Paying Agent . . . . . . . 27
ARTICLE V Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 5.1. Events of Default. . . . . . . . . . . . . . . . . . 28
SECTION 5.2. Rights upon Event of Default . . . . . . . . . . . . 30
SECTION 5.3. Collection of Indebtedness and Suits for
Enforcement by Trustee; Authority of
Controlling Party. . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 5.4. Remedies . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 5.5. Optional Preservation of the
Receivables. . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 5.6. Priorities . . . . . . . . . . . . . . . . . . . . . 34
SECTION 5.7. Limitation of Suits. . . . . . . . . . . . . . . . . 35
SECTION 5.8. Unconditional Rights of Noteholders To
Receive Principal and Interest . . . . . . . . . . . . . . . . 36
SECTION 5.9. Restoration of Rights and Remedies . . . . . . . . . 36
SECTION 5.10. Rights and Remedies Cumulative . . . . . . . . . . . 37
SECTION 5.11. Delay or Omission Not a Waiver . . . . . . . . . . . 37
SECTION 5.12. Control by Noteholders . . . . . . . . . . . . . . . 37
SECTION 5.13. Waiver of Past Defaults. . . . . . . . . . . . . . . 37
SECTION 5.14. Undertaking for Costs. . . . . . . . . . . . . . . . 38
SECTION 5.15. Waiver of Stay or Extension Laws . . . . . . . . . . 38
SECTION 5.16. Action on Notes. . . . . . . . . . . . . . . . . . . 38
SECTION 5.17. Performance and Enforcement of Certain
Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 5.18. Claims Under Policy. . . . . . . . . . . . . . . . . 40
SECTION 5.19. Preference Claims. . . . . . . . . . . . . . . . . . 42
ARTICLE VI The Trustee and the Indenture Collateral
Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 6.1. Duties of Trustee. . . . . . . . . . . . . . . . . . 43
SECTION 6.2. Rights of Trustee. . . . . . . . . . . . . . . . . . 45
SECTION 6.3. Individual Rights of Trustee . . . . . . . . . . . . 46
SECTION 6.4. Trustee's Disclaimer . . . . . . . . . . . . . . . . 46
SECTION 6.5. Notice of Defaults . . . . . . . . . . . . . . . . . 47
SECTION 6.6. Reports by Trustee to Holders. . . . . . . . . . . . 47
SECTION 6.7. Compensation and Indemnity . . . . . . . . . . . . . 47
SECTION 6.8. Replacement of Trustee . . . . . . . . . . . . . . . 48
SECTION 6.9. Successor Trustee by Merger. . . . . . . . . . . . . 49
SECTION 6.10. Appointment of Co-Trustee or Separate
Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 6.11. Eligibility; Disqualification. . . . . . . . . . . . 51
SECTION 6.12. Appointment and Powers . . . . . . . . . . . . . . . 51
SECTION 6.13. Performance of Duties. . . . . . . . . . . . . . . . 52
SECTION 6.14. Limitation on Liability. . . . . . . . . . . . . . . 52
SECTION 6.15. Reliance upon Documents. . . . . . . . . . . . . . . 53
SECTION 6.16. Successor Indenture Collateral Agent . . . . . . . . 53
SECTION 6.17. Compensation and Indemnity . . . . . . . . . . . . . 55
SECTION 6.18. Representations and Warranties of the
Indenture Collateral Agent . . . . . . . . . . . . . . . . . . 56
SECTION 6.19. Waiver of Setoffs. . . . . . . . . . . . . . . . . . 56
SECTION 6.20. Control by the Controlling Party . . . . . . . . . . 57
ARTICLE VII Noteholders' Lists and Reports . . . . . . . . . . . . . . . 57
SECTION 7.1. Issuer to Furnish Trustee Names and
Addresses to Noteholders . . . . . . . . . . . . . . . . . . . 57
SECTION 7.2. Preservation of Information,
Communications to Noteholders. . . . . . . . . . . . . . . . . 57
SECTION 7.3. Reports by Issuer. . . . . . . . . . . . . . . . . . 57
ARTICLE VIII Accounts, Disbursements and Releases. . . . . . . . . . . . 58
SECTION 8.1. Collection of Money. . . . . . . . . . . . . . . . . 58
SECTION 8.2. Trust Accounts . . . . . . . . . . . . . . . . . . . 58
SECTION 8.3. General Provisions Regarding Accounts. . . . . . . . 58
ARTICLE IX Supplemental Indentures . . . . . . . . . . . . . . . . . . . 59
SECTION 9.1. Supplemental Indentures Without Consent
of Noteholders . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 9.2. Supplemental Indentures With Consent of
Noteholders. . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.3. Execution of Supplemental Indentures . . . . . . . . 62
SECTION 9.4. Effect of Supplemental Indenture . . . . . . . . . . 62
SECTION 9.5. Reference in Notes to Supplemental
Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . 62
ARTICLE X Redemption of Notes. . . . . . . . . . . . . . . . . . . . . . 62
SECTION 10.1. Redemption . . . . . . . . . . . . . . . . . . . . . 62
SECTION 10.2. Form of Redemption Notice. . . . . . . . . . . . . . 63
SECTION 10.3. Notes Payable on Redemption Date . . . . . . . . . . 63
ARTICLE XI Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 11.1. Compliance Certificates and Opinions,
etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 11.2. Form of Documents Delivered to Trustee . . . . . . . 65
SECTION 11.3. Acts of Noteholders. . . . . . . . . . . . . . . . . 66
SECTION 11.4. Notices, etc . . . . . . . . . . . . . . . . . . . . 67
SECTION 11.5. Notices to Noteholders; Waiver . . . . . . . . . . . 68
SECTION 11.6. Alternate Payment and Notice Provisions. . . . . . . 69
SECTION 11.7. Effect of Headings and Table of
Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
SECTION 11.8. Successors and Assigns . . . . . . . . . . . . . . . 69
SECTION 11.9. Severability . . . . . . . . . . . . . . . . . . . . 69
SECTION 11.10. Benefits of Indenture. . . . . . . . . . . . . . . . 69
SECTION 11.11. Legal Holidays . . . . . . . . . . . . . . . . . . . 70
SECTION 11.12. GOVERNING LAW. . . . . . . . . . . . . . . . . . . . 70
SECTION 11.13. Counterparts . . . . . . . . . . . . . . . . . . . . 70
SECTION 11.14. Recording of Indenture . . . . . . . . . . . . . . . 70
SECTION 11.15. Trust Obligation . . . . . . . . . . . . . . . . . . 70
SECTION 11.16. No Petition. . . . . . . . . . . . . . . . . . . . . 71
SECTION 11.17. Inspection . . . . . . . . . . . . . . . . . . . . . 71
INDENTURE, dated as of December 1, 1994, between
AMERICREDIT RECEIVABLES FINANCE CORP., a Delaware corporation
(the "Issuer"), and LASALLE NATIONAL BANK, a national banking
association, in its capacities as trustee (the "Trustee) and
as Indenture Collateral Agent (as defined below) and not in
its individual capacity.
Each party agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the
Holders of the Issuer's 8.19% Automobile Receivables-Backed
Notes (the "Notes):
As security for the payment and performance by the
Issuer of its obligations under this Indenture and the Notes,
the Issuer has agreed to assign the Indenture Collateral (as
defined below) as collateral to the Indenture Collateral
Agent for the benefit of the Trustee on behalf of the
Noteholders.
Financial Security Assurance Inc. (the "Security
Insurer") has issued and delivered a financial guaranty
insurance policy, dated the Closing Date (with endorsements,
the "Policy"), pursuant to which the Security Insurer
guarantees certain Scheduled Payments, as defined in the
Policy.
As an inducement to the Security Insurer to issue and
deliver the Policy, the Issuer has executed and delivered the
Insurance and Indemnity Agreement, dated as of December 1,
1994 (as amended from time to time, the "Insurance
Agreement"), among the Security Insurer, the Issuer,
AmeriCredit Receivables Corp., AmeriCredit Financial
Services, Inc. and AmeriCredit Corp.
As an additional inducement to the Security Insurer to
issue the Policy, and as security for the performance by the
Issuer of the Insurer Issuer Secured Obligations and as
security for the performance by the Issuer of the Trustee
Issuer Secured Obligations, the Issuer has agreed to assign
the Indenture Collateral as collateral to the Indenture
Collateral Agent for the benefit of the Issuer Secured
Parties, as their respective interests may appear.
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Collateral
Agent at the Closing Date, on behalf of and for the benefit
of the Issuer Secured Parties to secure the performance of
the respective Issuer Secured Obligations, all of the
Issuer's right, title and interest in and to (a) the
Receivables and all moneys paid or payable thereon or in
respect thereof after October 31, 1994; (b) an assignment of
the security interests of AFS in the Financed Vehicles; (c)
the Insurance Policies and any proceeds from any Insurance
Policies relating to the Receivables, the Obligors or the
Financed Vehicles, including rebates of premiums; (d) rights
of AFS or the Seller against Dealers with respect to the
Receivables under the Dealer Agreements and the Dealer
Assignments; (e) all items contained in the Receivable Files
and any and all other documents that AFS keeps on file in
accordance with its customary procedures relating to the
Receivables, the Obligors or the Financed Vehicles, (f)
property (including the right to receive future Liquidation
Proceeds) that secures a Receivable and that has been
acquired by or on behalf of the Issuer pursuant to
liquidation of such Receivable; (g) all funds on deposit from
time to time in the Trust Accounts (as defined in the Sale
and Servicing Agreement) and in all investments and proceeds
thereof (including all income thereon and all amounts
deposited in respect of Administrative Receivables and
Warranty Receivables); (h) the Purchase Agreement, including
the right assigned to the Issuer to cause AFS to repurchase
Receivables from the Seller under certain circumstances; (i)
the Sale and Servicing Agreement (including all rights of the
Seller under the Purchase Agreement assigned to the Issuer
pursuant to the Sale and Servicing Agreement); (j) the Trust
Accounts and (k) all present and future claims, demands,
causes and choses in action in respect of any or all of the
foregoing and all payments on or under and all proceeds of
every kind and nature whatsoever in respect of any or in lieu
of the foregoing, including all proceeds of the conversion,
voluntary or involuntary, into cash or other liquid property,
all cash proceeds, accounts, accounts receivable, notes,
drafts, acceptances, chattel paper, checks, deposit accounts,
insurance proceeds, condemnation awards, rights to payment of
any and every kind and other forms of obligations and
receivables, instruments and other property which at any time
constitute all or part of or are included in the proceeds of
any of the foregoing (collectively, the "Indenture
Collateral").
The Indenture Collateral Agent, for the benefit of the
Trustee on behalf of the Holders of the Notes and for the
benefit of the Security Insurer acknowledges such Grant. The
Trustee on behalf of the Holders of the Notes accepts the
trusts under this Indenture in accordance with the provisions
of this Indenture and agrees to perform its duties required
in this Indenture to the best of its ability to the end that
the interests of the Holders of the Notes may be adequately
and effectively protected.
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.1. Definitions.
(a) Except as otherwise specified herein or as the
context may otherwise require, the following terms have the
respective meanings set forth below for all purposes of this
Indenture.
"Act" has the meaning specified in Section 11.3(a).
"Administrative Services and Facilities Agreements"
means, the agreements by and between AmeriCredit Financial
Services, Inc. and each of the Issuer and the Seller,
respectively, dated as of December 1, 1994.
"Affiliate" means, with respect to any specified Person,
any other Person controlling or controlled by or under common
control with such specified Person. For the purposes of this
definition, "control" when used with respect to any specified
Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and
the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"AFS" means AmeriCredit Financial Services, Inc.
"Authorized Officer" means, with respect to the Issuer,
any officer of the Issuer who is authorized to act for the
Issuer in matters relating to the Issuer and who is
identified on the list of Authorized Officers delivered by
the Issuer to the Trustee on the Closing Date (as such list
may be modified or supplemented from time to time
thereafter).
"Business Day" means any day other than a Saturday,
Sunday, legal holiday or other day on which commercial
banking institutions in Fort Worth, Texas, New York, New
York, Chicago, Illinois, or any other location of any
successor Servicer, successor Issuer, successor Trustee or
successor Indenture Collateral Agent are authorized or
obligated by law, executive order or governmental decree to
remain closed.
"Closing Date" means December 22, 1994.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time, and Treasury Regulations
promulgated thereunder.
"Controlling Party" means the Security Insurer, so long
as no Insurer Default shall have occurred and be continuing
and the Trustee for the benefit of the Noteholders, for so
long as an Insurer Default shall have occurred and be
continuing.
"Corporate Trust Office" means the principal office of
the Trustee at which at any particular time its corporate
trust business shall be administered which office at date of
the execution of this Indenture is located at 135 S. LaSalle
Street, Suite 200, Chicago, Illinois 60603-4105 Attention:
Asset-Backed Securities Trust Services Department; or at such
other address as the Trustee may designate from time to time
by notice to the Noteholders, the Security Insurer and the
Issuer, or the principal corporate trust office of any
successor Trustee (the address of which the successor Trustee
will notify the Noteholders, the Security Insurer and the
Issuer).
"Default" means any occurrence that is, or with notice
or the lapse of time or both would become, an Event of
Default.
"Event of Default" has the meaning specified in Section
5.1.
"Executive Officer" means, with respect to any
corporation, the Chief Executive Officer, Chief Operating
Officer, Chief Financial Officer, President, Executive Vice
President, any Vice President, any Responsible Officer, the
Secretary or the Treasurer of such corporation; and with
respect to any partnership, any general partner thereof.
"Final Scheduled Distribution Date" means December 15,
1999 (or, if such day is not a Business Day, the next
Business Day thereafter).
"Final Scheduled Maturity Date" means July 31, 1999.
"Grant" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create,
and grant a lien upon and a security interest in and right of
set-off against, deposit, set over and confirm pursuant to
this Indenture. A Grant of the Indenture Collateral or of
any other agreement or instrument shall include all rights,
powers and options (but none of the obligations) of the
Granting party thereunder, including the immediate and
continuing right to claim for, collect, receive and give
receipt for principal and interest payments in respect of the
Indenture Collateral and all other moneys payable thereunder,
to give and receive notices and other communications, to make
waivers or other agreements, to exercise all rights and
options, to bring Proceedings in the name of the Granting
party or otherwise and generally to do and receive anything
that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.
"Holder" or "Noteholder" means the Person in whose name
a Note is registered on the Note Register.
"Indebtedness" means, with respect to any Person at any
time, (a) indebtedness or liability of such Person for
borrowed money whether or not evidenced by bonds, debentures,
notes or other instruments, or for the deferred purchase
price of property or services (including trade obligations);
(b) obligations of such Person as lessee under leases which
should have been or should be, in accordance with generally
accepted accounting principles, recorded as capital leases;
(c) current liabilities of such Person in respect of unfunded
vested benefits under plans covered by Title IV of ERISA; (d)
obligations issued for or liabilities incurred on the account
of such Person; (e) obligations or liabilities of such Person
arising under acceptance facilities; (f) obligations of such
Person under any guarantees, endorsements (other than for
collection or deposit in the ordinary course of business) and
other contingent obligations to purchase, to provide funds
for payment, to supply funds to invest in any Person or
otherwise to assure a creditor against loss; (g) obligations
of such Person secured by any Lien on property or assets of
such Person, whether or not the obligations have been assumed
by such Person; or (h) obligations of such Person under any
interest rate or currency exchange agreement.
"Indenture" means this Indenture as amended or
supplemented from time to time.
"Indenture Collateral" has the meaning specified in the
Granting Clause of this Indenture.
"Indenture Collateral Agent" means, initially, LaSalle
National Bank, in its capacity as collateral agent on behalf
of the Issuer Secured Parties, including its successors in
interest, until and unless a successor Person shall have
become the Indenture Collateral Agent pursuant to Section
6.16 hereof, and thereafter "Indenture Collateral Agent"
shall mean such successor Person; provided however, that the
Trustee and the Indenture Collateral Agent shall always be
the same Person.
"Independent" means, when used with respect to any
specified Person, that the Person (a) is in fact independent
of the Issuer, any other obligor upon the Notes, the Seller
and any Affiliate of any of the foregoing Persons, (b) does
not have any direct financial interest or any material
indirect financial interest in the Issuer, any such other
obligor, the Seller or any Affiliate of any of the foregoing
Persons and (c) is not connected with the Issuer, any such
other obligor, the Seller or any Affiliate of any of the
foregoing Persons as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing
similar functions.
"Independent Certificate" means a certificate or opinion
to be delivered to the Indenture Collateral Agent under the
circumstances described in, and otherwise complying with, the
applicable requirements of Section 11.1, made by an
Independent appraiser or other expert appointed by an Issuer
Order and approved by the Indenture Collateral Agent in the
exercise of reasonable care, and such opinion or certificate
shall state that the signer has read the definition of
"Independent" in this Indenture and that the signer is
Independent within the meaning thereof.
"Insurance Agreement Indenture Cross Default" has the
meaning specified therefor in the Insurance Agreement.
"Insurer Issuer Secured Obligations" means all amounts
and obligations which the Issuer may at any time owe to or on
behalf of the Security Insurer under this Indenture, the
Insurance Agreement or any other Related Document.
"Issuer" means the party named as such in this Indenture
until a successor replaces it and, thereafter, means the
successor and, for purposes of any provision contained herein
each other obligor on the Notes.
"Issuer Order" and "Issuer Request" means a written
order or request signed in the name of the Issuer by any one
of its Authorized Officers and delivered to the Trustee.
"Issuer Secured Obligations" means the Insurer Issuer
Secured Obligations and the Trustee Issuer Secured
Obligations.
"Issuer Secured Parties" means each of the Trustee in
respect of the Trustee Issuer Secured Obligations and the
Security Insurer in respect of the Insurer Issuer Secured
Obligations.
"Letter Agreement" has the meaning specified in Section
6.7.
"Majority Noteholder" means the holder of a Note
Majority.
"Note" means any of the 8.19% Automobile Receivable -
Backed Notes Series 1994-A issued by the Issuer on the
Closing Date.
"Note Interest Rate" means 8.19% per annum (computed on
the basis of a 360-day year of twelve 30-day months).
"Note Register" and "Note Registrar" have the respective
meanings specified in Section 2.4.
"Notice of Claim" has the meaning specified in Section
5.18(b).
"Officers' Certificate" means a certificate signed by
any Authorized Officer of the Issuer, under the circumstances
described in, and otherwise complying with, the applicable
requirements of Section 11.1, and delivered to, the Trustee.
Unless otherwise specified, any reference in this Indenture
to an Officers' Certificate shall be to an Officers'
Certificate of any Authorized Officer of the Issuer.
"Opinion of Counsel" means one or more written opinions
of counsel who may, except as otherwise expressly provided in
this Indenture, be employees of or counsel to the Issuer and
who shall be satisfactory to the Trustee for its benefit and
for the benefit of the Noteholders and, if addressed to the
Security Insurer, satisfactory to the Security Insurer, and
which shall comply with any applicable requirements of
Section 11.1, and shall be in form and substance satisfactory
to the Trustee for its benefit and for the benefit of the
Noteholders, and if addressed to the Security Insurer,
satisfactory to the Security Insurer.
"Outstanding" means, as of the date of determination,
all Notes theretofore authenticated and delivered under this
Indenture except:
(i) Notes theretofore canceled by the Note
Registrar or delivered to the Note Registrar for
cancellation;
(ii) Notes or portions thereof the payment for
which money in the necessary amount has been theretofore
deposited with the Trustee or any Paying Agent in trust
for the Holders of such Notes (provided, however, that
if such Notes are to be redeemed, notice of such
redemption has been duly given pursuant to this
Indenture or provision therefor, satisfactory to the
Trustee, has been made); and
(iii) Notes in exchange for or in lieu of other
Notes which have been authenticated and delivered
pursuant to this Indenture unless proof satisfactory to
the Trustee is presented that any such Notes are held by
a bona fide purchaser;
provided, however, that Notes which have been paid with
proceeds of the Policy shall continue to remain Outstanding
for purposes of this Indenture until the Security Insurer has
been paid as subrogee hereunder or reimbursed pursuant to the
Insurance Agreement as evidenced by a written notice from the
Security Insurer delivered to the Trustee, and the Security
Insurer shall be deemed to be the Holder thereof to the
extent of any payments thereon made by the Security Insurer;
provided, further, that in determining whether the Holders of
the requisite Outstanding Amount of the Notes have given any
request, demand, authorization, direction, notice, consent or
waiver hereunder or under any Related Document, Notes owned
by the Issuer, any other obligor upon the Notes, the Seller
or any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying
upon any such request, demand, authorization, direction,
notice, consent or waiver, only Notes that the Trustee knows
to be so owned shall be so disregarded. Notes so owned that
have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of
the Trustee the pledgee's right so to act with respect to
such Notes and that the pledgee is not the Issuer, any other
obligor upon the Notes, the Seller or any Affiliate of any of
the foregoing Persons.
"Outstanding Amount" means the aggregate principal
amount of all Notes Outstanding at the date of determination.
"Paying Agent" means the Trustee or any other Person
that meets the eligibility standards for the Trustee
specified in Section 6.11 and, so long as no Insurer Default
shall have occurred and be continuing, is consented to by the
Security Insurer and is authorized by the Issuer to make the
distributions from the
Note Distribution Account, including payment of principal of
or interest on the Notes on behalf of the Issuer.
"Payment Date" means a Distribution Date.
"Person" means any individual, corporation, estate,
partnership, limited liability company, joint venture,
association, joint stock company, trust (including any
beneficiary thereof), unincorporated organization or
government or any agency or political subdivision thereof.
"Placement Agreement" means the agreement dated as of
December 1, 1994, relating to the private placement of the
Notes.
"Policy" means the financial guaranty insurance policy
issued by the Security Insurer with respect to the Notes,
including any endorsements thereto, in the form of Exhibit E.
"Policy Claim Amount" has the meaning specified in
Section 5.18(a).
"Predecessor Note" means, with respect to any particular
Note, every previous Note evidencing all or a portion of the
same debt as that evidenced by such particular Note; and, for
the purpose of this definition, any Note authenticated and
delivered under Section 2.5 in lieu of a mutilated, lost,
destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.
"Preference Claim" has the meaning specified in Section
5.19.
"Proceeding" means any suit in equity, action at law or
other judicial or administrative proceeding.
"Rating Agency" means each of Moody's and Standard &
Poor's, so long as such Persons maintain a rating on the
Notes; and if either Moody's or Standard & Poor's no longer
maintains a rating on the Notes, such other nationally
recognized statistical rating organization selected by the
Issuer and (so long as an Insurer Default shall not have
occurred and be continuing) acceptable to the Security
Insurer.
"Rating Agency Condition" means, with respect to any
action, that each Rating Agency shall have been given 10 days
prior notice thereof and that each of the Rating Agencies
shall have notified the Seller, the Servicer, the Security
Insurer, the Trustee and the Issuer in writing that such
action will not result in a reduction or withdrawal of the
then current rating of the Notes and will not result in an
increased capital charge to the Security Insurer.
"Record Date" means, with respect to a Payment Date or
Redemption Date, the close of business on the last Business
Day immediately preceding such Payment Date or Redemption
Date.
"Redemption Date" means in the case of a redemption of
the Notes pursuant to Section 10.1, the Payment Date
specified by the Issuer pursuant to Section 10.1.
"Redemption Price" means in the case of a redemption of
the Notes pursuant to Section 10.1, an amount equal to the
principal amount of the Notes redeemed plus accrued and
unpaid interest thereon at the Note Interest Rate to but
excluding the Redemption Date.
"Registered Holder" means the Person in whose name a
Note is registered on the Note Register on the applicable
Record Date.
"Related Documents" means the Notes, the Purchase
Agreement, the Sale and Servicing Agreement, the Custodian
Agreement, the Administrative Services and Facilities
Agreements, the Policy, the Spread Account Agreement, the
Insurance Agreement, the Indemnification Agreement (as
defined in the Insurance Agreement), the Lockbox Agreement,
the Stock Pledge Agreement and the Placement Agent Agreement
between the Issuer, the Seller and AFS and the placement
agent of the Notes. The Related Documents executed by any
party are referred to herein as "such party's Related
Documents" "its Related Documents" or by a similar
expression.
"Responsible Officer" means, with respect to the
Trustee, any officer of the Trustee assigned by the Trustee
to administer its corporate trust affairs relating to the
Trust Estate.
"Sale and Servicing Agreement" means the Sale and
Servicing Agreement, dated as of December 1, 1994, among the
Issuer, the Seller, AFS, in its individual capacity and as
the Servicer and the Backup Servicer, in the form of Exhibit
B.
"Schedule of Receivables" means the listing of the
Receivables set forth in Exhibit A.
"Scheduled Payments" has the meaning specified therefor
in the Policy.
"Securities Act" means the Securities Act of 1933, as
amended.
"State" means any one of the 50 states of the United
States of America or the District of Columbia.
"Termination Date" means the latest of (i) the
expiration of the Policy and the return of the Policy to the
Security Insurer for cancellation, (ii) the date on which the
Security Insurer shall have received payment and performance
of all Insurer Issuer Secured Obligations and (iii) the date
on which the Trustee shall have received payment and
performance of all Trustee Issuer Secured Obligations.
"Trust Estate" means all money, instruments, rights and
other property that are subject or intended to be subject to
the lien and security interest of this Indenture for the
benefit of the Noteholders (including without limitation, the
Indenture Collateral Granted to the Indenture Collateral
Agent), including all proceeds thereof.
"Trustee" means LaSalle National Bank, a national
banking association, as Trustee under this Indenture, or any
successor Trustee under this Indenture.
"Trustee Issuer Secured Obligations" means all amounts
and obligations which the Issuer may at any time owe to or on
behalf of the Trustee for the benefit of the Noteholders
under this Indenture or the Notes.
"UCC" means, unless the context otherwise requires, the
Uniform Commercial Code, as in effect in the relevant
jurisdiction, as amended from time to time.
(b) Capitalized terms used herein without definition
shall have the respective meanings assigned to such terms in
the Sale and Servicing Agreement.
SECTION 1.2. Rules of Construction. Unless otherwise
specified:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has
the meaning assigned to it in accordance with generally
accepted accounting principles as in effect from time to
time;
(iii) "or" is not exclusive;
(iv) "including" means including without
limitation;
(v) words in the singular include the plural and
words in the plural include the singular; and
(vi) references to Sections, Subsections, Schedules
and Exhibits shall refer to such portions of this
Indenture.
ARTICLE II
The Notes
SECTION 2.1. Form. The Notes and the Trustee's
certificate of authentication shall be in substantially the
forms set forth in Exhibit D, with such appropriate
insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture and may have such
letters, numbers or other marks of identification and such
legends or endorsements placed thereon as may, consistently
herewith, be determined by the officers executing such Notes,
as evidenced by their execution of the Notes. Any portion of
the text of any Note may be set forth on the reverse thereof,
with an appropriate reference thereto on the face of the
Note.
The Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods
(with or without steel engraved borders), all as determined
by the officers executing such Notes, as evidenced by their
execution of such Notes.
Each Note shall be dated the date of its authentication.
The terms of the Notes set forth in Exhibit D are part of the
terms of this Indenture.
SECTION 2.2. Execution, Authentication and Delivery.
The Notes shall be executed on behalf of the Issuer by any of
its Authorized Officers. The signature of any such
Authorized Officer on the Notes may be manual or facsimile.
Notes bearing the manual or facsimile signature of
individuals who were at any time Authorized Officers of the
Issuer shall bind the Issuer, notwithstanding that such
individuals or any of them have ceased to hold such offices
prior to the authentication and delivery of such Notes or did
not hold such offices at the date of such Notes.
The Trustee shall upon receipt of the Policy and Issuer
Order authenticate and deliver Notes for original issue in an
aggregate principal amount of $51,000,000. The aggregate
principal amount of Notes outstanding at any time may not
exceed that amount except as provided in Section 2.5.
Each Note shall be dated the date of its authentication.
The Notes shall be issuable as registered Notes in minimum
denominations of $100,000 and in integral multiples of $1,000
in excess thereof.
No Note shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose, unless
there appears on such Note a certificate of authentication
substantially in the form provided for herein executed by the
Trustee by the manual signature of one of its authorized
signatories, and such certificate upon any Note shall be
conclusive evidence, and the only evidence, that such Note
has been duly authenticated and delivered hereunder.
SECTION 2.3. Temporary Notes. Pending the preparation
of definitive Notes, the Issuer may execute, and upon receipt
of an Issuer Order the Trustee shall authenticate and
deliver, temporary Notes which are printed, lithographed,
typewritten, mimeographed or otherwise produced, of the tenor
of the definitive Notes in lieu of which they are issued and
with such variations not inconsistent with the terms of this
Indenture as the officers executing such Notes may determine,
as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuer will cause
definitive Notes to be prepared without unreasonable delay.
After the preparation of definitive Notes, the temporary
Notes shall be exchangeable for definitive Notes upon
surrender of the temporary Notes at the office or agency of
the Issuer to be maintained as provided in Section 3.2,
without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Notes, the Issuer
shall execute and the Trustee shall authenticate and deliver
in exchange therefor a like principal amount of definitive
Notes of authorized denominations. Until so exchanged, the
temporary Notes shall in all respects be entitled to the same
benefits under this Indenture as definitive Notes.
SECTION 2.4. Registration; Registration of Transfer and
Exchange. The Issuer shall cause to be kept a register (the
"Note Register") in which, subject to such reasonable
regulations as it may prescribe, the Issuer shall provide for
the registration of Notes and the registration of transfers
of Notes. The Trustee shall be "Note Registrar" for the
purpose of registering Notes and transfers of Notes as herein
provided. Upon any resignation of any Note Registrar, the
Issuer shall promptly appoint a successor or, if it elects
not to make such an appointment, assume the duties of Note
Registrar.
If a Person other than the Trustee is appointed by the
Issuer as Note Registrar, the Issuer will give the Trustee
prompt written notice of the appointment of such Note
Registrar and of the location, and any change in the
location, of the Note Register, and the Trustee shall have
the right to inspect the Note Register at all reasonable
times and to obtain copies thereof, and the Trustee shall
have the right to rely upon a certificate executed on behalf
of the Note Registrar by an Executive Officer thereof as to
the names and addresses of the Holders of the Notes and the
principal amounts and number of such Notes.
Upon surrender for registration of transfer of any Note
at the office or agency of the Issuer to be maintained as
provided in Section 3.2, the Issuer shall execute, and the
Trustee shall authenticate and the Noteholder shall obtain
from the Trustee, in the name of the designated transferee or
transferees, one or more new Notes in any authorized
denominations, of a like aggregate principal amount.
At the option of the Holder, Notes may be exchanged for
other Notes in any authorized denominations, of a like
aggregate principal amount, upon surrender of the Notes to be
exchanged at such office or agency. Whenever any Notes are
so surrendered for exchange, the Issuer shall execute, and
the Trustee shall authenticate and the Noteholder shall
obtain from the Trustee, the Notes which the Noteholder
making the exchange is entitled to receive.
All Notes issued upon any registration of transfer or
exchange of Notes shall be the valid obligations of the
Issuer, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Notes surrendered upon
such registration of transfer or exchange.
Every Note presented or surrendered for registration of
transfer or exchange shall be duly endorsed by, or be
accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing
with such signature guaranteed by a commercial bank or trust
company located, or having a correspondent located, in The
City of New York or the city in which the Corporate Trust
Office is located, or by a member firm of a national
securities exchange, and such other documents as the Trustee
may require.
No service charge shall be made to a Holder for any
registration of transfer or exchange of Notes, but the Issuer
or the Trustee may require payment of a sum sufficient to
cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges pursuant to Section
2.3 or 9.6 not involving any transfer.
The preceding provisions of this section
notwithstanding, the Issuer shall not be required to make and
the Note Registrar need not register transfers or exchanges
of Notes selected for redemption or of any Note for a period
of 15 days preceding the due date for any payment with
respect to the Note.
SECTION 2.5. Mutilated, Destroyed, Lost or Stolen
Notes. If (i) any mutilated Note is surrendered to the
Trustee, or the Trustee receives evidence to its satisfaction
of the destruction, loss or theft of any Note, and (ii) there
is delivered to the Trustee and the Security Insurer (unless
an Insurer Default shall have occurred and be continuing)
such security or indemnity as may be required by them to hold
the Issuer, the Trustee and the Security Insurer harmless
(except, in the case of The Prudential Insurance Company of
America or any Affiliate thereof, a written agreement of
indemnity from such Noteholder shall satisfy such
requirement) then, in the absence of notice to the Issuer,
the Note Registrar or the Trustee that such Note has been
acquired by a bona fide purchaser, the Issuer shall execute
and upon its request the Trustee shall authenticate and
deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note; provided,
however, that if any such destroyed, lost or stolen Note, but
not a mutilated Note, shall have become or within seven days
shall be due and payable, or shall have been called for
redemption, instead of issuing a replacement Note, the Issuer
may pay such destroyed, lost or stolen Note when so due or
payable or upon the Redemption Date without surrender
thereof. If, after the delivery of such replacement Note or
payment of a destroyed, lost or stolen Note pursuant to the
proviso to the preceding sentence, a bona fide purchaser of
the original Note in lieu of which such replacement Note was
issued presents for payment such original Note, the Issuer,
the Security Insurer and the Trustee shall be entitled to
recover such replacement Note (or such payment) from the
Person to whom it was delivered or any Person taking such
replacement Note from such Person to whom such replacement
Note was delivered or any assignee of such Person, except a
bona fide purchaser, and shall be entitled to recover upon
the security or indemnity provided therefor to the extent of
any loss, damage, cost or expense incurred by the Issuer or
the Trustee in connection therewith.
Upon the issuance of any replacement Note under this
Section, the Issuer or the Trustee may require the payment by
the Holder of such Note of a sum sufficient to cover any tax
or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees
and expenses of the Trustee or the Note Registrar) connected
therewith.
Every replacement Note issued pursuant to this Section
in replacement of any mutilated, destroyed, lost or stolen
Note shall constitute an original additional contractual
obligation of the Issuer, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time
enforceable by anyone, and shall be entitled to all the
benefits of this Indenture equally and proportionately with
any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies
with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Notes.
SECTION 2.6. Person Deemed Owner. Prior to due
presentment for registration of transfer of any Note, the
Issuer, the Trustee, the Security Insurer and any agent of
the Issuer, the Trustee or the Security Insurer may treat the
Person in whose name any Note is registered (as of the day of
determination) as the owner of such Note for the purpose of
receiving payments of principal of and interest, if any, on
such Note and for all other purposes whatsoever, whether or
not such Note be overdue, and none of the Issuer, the
Security Insurer, the Trustee nor any agent of the Issuer or
the Trustee shall be affected by notice to the contrary.
SECTION 2.7. Payment of Principal and Interest.
(a) The Notes shall accrue interest as provided in the
form of the Note set forth in Exhibit D, and such interest
shall be payable on each Payment Date as specified therein.
Any installment of interest or principal, if any, payable on
any Note which is punctually paid or duly provided for by the
Issuer on the applicable Payment Date shall be paid to the
Person in whose name such Note (or one or more Predecessor
Notes) is registered on the Record Date, by wire transfer
(provided that the Noteholder has delivered to the Trustee in
writing instructions with respect to effecting a wire
transfer to such Noteholder) or by check mailed first-class,
postage prepaid to such Person's address as it appears on the
Note Register on such Record Date, except for the final
installment of principal payable with respect to such Note on
a Payment Date or on the Final Scheduled Distribution Date
(and except for the Redemption Price for any Note called for
redemption pursuant to Section 10.1(a)) which shall be
payable as provided below. The funds represented by any such
checks returned undelivered shall be held in accordance with
Section 3.3.
(b) The principal of each Note shall be payable in
installments on each Payment Date as provided in the form of
Note set forth in Exhibit D. Notwithstanding the foregoing
the entire unpaid principal amount of the Notes shall be due
and payable, if not previously paid, on the date on which an
Event of Default shall have occurred and be continuing so
long as an Insurer Default shall not have occurred and be
continuing or, if an Insurer Default shall have occurred and
be continuing on the date on which an Event of Default shall
have occurred and be continuing and the Trustee or a Note
Majority have declared the Notes to be immediately due and
payable in the manner provided in Section 5.2. All principal
payments on the Notes shall be made pro rata to the
Noteholders entitled thereto. The Trustee shall notify the
Person in whose name a Note is registered at the close of
business on the Record Date preceding the Payment Date on
which the Issuer expects that the final installment of
principal of and interest on such Note will be paid. Such
notice shall be mailed no later than five days prior to such
final Payment Date and shall specify that such final
installment will be payable only upon presentation and
surrender of such Note and shall specify the place where such
Note may be presented and surrendered for payment of such
installment; provided however, if The Prudential Insurance
Company of America or if any Affiliate thereof is a
Noteholder, the final installment shall be made without
presentation and surrender of the Note to the Trustee. By
purchase and acceptance of the Notes, the Prudential
Insurance Company of America agrees to surrender the Notes to
the Trustee within a reasonable period of time after receipt
of such final installment. Notices in connection with
redemptions of Notes shall be mailed to Noteholders as
provided in Section 10.2.
(c) Promptly following the date on which all principal
of and interest on the Notes has been paid in full and the
Notes have been surrendered to the Trustee, the Trustee
shall, if the Security Insurer has paid any amount in respect
of the Notes under the Policy which has not been reimbursed
to it, deliver such surrendered Notes to the Security
Insurer.
SECTION 2.8. Cancellation. Subject to Section 2.7(c),
all Notes surrendered for payment, registration of transfer,
exchange or redemption shall, if surrendered to any Person
other than the Trustee, be delivered to the Trustee and shall
be promptly canceled by the Trustee. Subject to Section
2.7(c), the Issuer may at any time deliver to the Trustee for
cancellation any Notes previously authenticated and delivered
hereunder which the Issuer may have acquired in any manner
whatsoever, and all Notes so delivered shall be promptly
canceled by the Trustee. No Notes shall be authenticated in
lieu of or in exchange for any Notes canceled as provided in
this Section, except as expressly permitted by this
Indenture. Subject to Section 2.7(c), all canceled Notes may
be held or disposed of by the Trustee in accordance with its
standard retention or disposal policy as in effect at the
time unless the Issuer shall direct by an Issuer Order that
they be destroyed or returned to it, provided that such
Issuer Order is timely and the Notes have not been previously
disposed of by the Trustee.
SECTION 2.9. Certain Transfer Restrictions.
(a) No Note may be sold or transferred (including,
without limitation, by pledge or hypothecation) unless such
sale or transfer is (i) pursuant to a registration under the
Securities Act and the securities laws of applicable states,
(ii) pursuant to Rule 144A of the Securities Act or (iii)
exempt from the registration requirements of the Securities
Act of 1933, as amended, and is exempt from registration
under applicable state securities laws. The Issuer shall
require, prior to any sale or other transfer of a Note, in
order to assure compliance with the preceding sentence, that
the Noteholder's prospective transferee certify to the Issuer
and the Trustee in writing the facts surrounding such
transfer in a certificate in the form attached as Exhibit A
to the Placement Agreement or substantially in a form
approved by the Issuer from time to time, as appropriately
modified to reflect the facts applicable to such transfer and
it being understood that such certificate is not intended to
create additional restrictions on transfer of the Notes.
Each such purchaser of the Notes shall be required to
represent in such certificate that it is acquiring its Notes
for its own account and not as nominee for undisclosed
investors and not with a view to any "distribution" within
the meaning of the Securities Act of 1933, as amended, and to
agree in such certificate that it will not resell its Notes
except as set forth above, and subject to the limitation on
the number of Noteholders and other restrictions on
transferability contained herein and in the Indenture.
Neither the Issuer nor the Trustee is obligated to register
the Notes under the Securities Act or any state securities
laws.
(b) No Note may be issued, sold or transferred if
such issuance, sale or transfer would result in 25% or more
of the value of securities issued by the Issuer being held by
persons who are benefit plan investors as defined in
paragraph (f)(2) of the Department of Labor Reg. 2510.3-101.
The foregoing sentence shall be administered and interpreted
in accordance with such regulation to prevent the assets of
the Issuer from being treated as "plan assets" under such
regulations and the Employee Retirement Income Security Act
of 1974, as amended (ERISA).
(c) No Note may be issued, sold or transferred
unless such issue, sale or transfer does not constitute a
"prohibited transaction" under Section 4975 of the Code or
Section 406 of ERISA. If the certificate of the transferee
certifies that funds of an employee benefit plan subject to
ERISA will be used to acquire a Note, the Trustee or the
Issuer shall require, prior to any sale or transfer of a
Note, the certificates of appropriate Persons establishing
that no such prohibited transaction shall exist or an Opinion
of Counsel addressed to the Trustee and the Issuer to the
effect that such sale or transfer does not constitute such a
prohibited transaction in order to assure compliance with the
preceding sentence.
In determining compliance with the transfer restrictions
contained in this Section 2.9, the Trustee may rely upon an
Opinion of Counsel, the cost of obtaining which shall be an
expense of the holder of the Note to be transferred.
ARTICLE III
Covenants
SECTION 3.1. Payment of Principal and Interest. The
Issuer will duly and punctually pay the principal and
interest on the Notes in accordance with the terms of the
Notes and this Indenture. Without limiting the foregoing the
Issuer will cause to be distributed all amounts on deposit in
the Note Distribution Account on a Payment Date. Amounts
properly withheld under the Code by any Person from a payment
to any Noteholder of interest and/or principal shall be
considered as having been paid by the Issuer to such
Noteholder for all purposes of this Indenture.
SECTION 3.2. Maintenance of Office or Agency. The
Issuer will maintain in Dover, Delaware, an office or agency
where Notes may be surrendered for registration of transfer
or exchange, and where notices and demands to or upon the
Issuer in respect of the Notes and this Indenture may be
served. The Issuer hereby initially appoints the Trustee to
serve as its agent for the foregoing purposes. The Issuer
will give prompt written notice to the Trustee of the
location, and of any change in the location, of any such
office or agency. If at any time the Issuer shall fail to
maintain any such office or agency or shall fail to furnish
the Trustee with the address thereof, such surrenders,
notices and demands may be made or served at the Corporate
Trust Office, and the Issuer hereby appoints the Trustee as
its agent to receive all such surrenders, notices and
demands.
SECTION 3.3. Money for Payments To Be Held in Trust.
As provided in Section 8.2, all payments of amounts due and
payable with respect to any Notes that are to be made from
amounts withdrawn from the Note Distribution Account pursuant
to Section 8.2(b) shall be made on behalf of the Issuer by
the Trustee or by another Paying Agent, and no amounts so
withdrawn from the Note Distribution Account for payments of
Notes shall be paid over to the Issuer.
On, or before each Payment Date and Redemption Date, the
Issuer shall deposit or cause to be deposited in the Note
Distribution Account an aggregate sum sufficient to pay the
amounts then becoming due, such sum to be held in trust for
the benefit of the Persons entitled thereto and (unless the
Paying Agent is the Trustee) shall promptly notify the
Trustee of its action or failure so to act.
The Issuer will cause each Paying Agent other than the
Trustee to execute and deliver to the Trustee and the
Security Insurer an instrument in which such Paying Agent
shall agree with the Trustee (and if the Trustee acts as
Paying Agent, it hereby so agrees), subject to the provisions
of this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of
amounts due with respect to the Notes in trust for the
benefit of the Persons entitled thereto until such sums
shall be paid to such Persons or otherwise disposed of
as herein provided and pay such sums to such Persons as
herein provided;
(ii) give the Trustee notice of any default (of
which it has actual knowledge) by the Issuer (or any
other obligor upon the Notes) in the making of any
payment required to be made with respect to the Notes;
(iii) at any time during the continuance of any
such default, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in trust
by such Paying Agent;
(iv) immediately resign as a Paying Agent and
forthwith pay to the Trustee all sums held by it in
trust for the payment of Notes if at any time it ceases
to meet the standards required to be met by a Paying
Agent at the time of its appointment; and
(v) on behalf of and at the direction of the
Issuer, comply with all requirements of the Code with
respect to the withholding from any payments made by it
on any Notes of any applicable withholding taxes imposed
thereon and with respect to any applicable reporting
requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining
the satisfaction and discharge of this Indenture or for any
other purpose, by Issuer Order direct any Paying Agent to pay
to the Trustee all sums held in trust by such Paying Agent,
such sums to be held by the Trustee upon the same trusts as
those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability
with respect to such money.
Any money held by the Trustee or any Paying Agent in
trust for the payment of any amount due with respect to any
Note and remaining unclaimed for two years after such amount
has become due and payable shall be discharged from such
trust and upon Issuer Request with the consent of the
Security Insurer (unless an Insurer Default shall have
occurred and be continuing) shall be deposited by the Trustee
in the Collection Account; and the Holder of such Note shall
thereafter, as an unsecured general creditor, look only to
the Issuer for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money
shall thereupon cease; provided, however, that if such money
or any portion thereof had been previously deposited by the
Security Insurer or the Indenture Collateral Agent with the
Trustee for the payment of principal or interest on the
Notes, to the extent any amounts are owing to the Security
Insurer, such amounts shall be paid promptly to the Security
Insurer upon receipt of a written request by the Security
Insurer to such effect, and provided, further, that the
Trustee or such Paying Agent, before being required to make
any such repayment, may at the expense of the Issuer cause to
be published once, in a newspaper published in the English
language, customarily published on each Business Day and of
general circulation in The City of New York, notice that such
money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date
of such publication, any unclaimed balance of such money then
remaining will be repaid to or for the account of the Issuer.
The Trustee may also adopt and employ, at the expense of the
Issuer, any other reasonable means of notification of such
repayment (including, but not limited to, making notice of
such repayment to Holders whose Notes have been called but
have not been surrendered for redemption or whose right to or
interest in moneys due and payable but not claimed is
determinable from the records of the Trustee or of any Paying
Agent, at the last address of record for each such Holder).
SECTION 3.4. Existence. The Issuer will keep in full
effect its existence, rights and franchises as a corporation
under the laws of the State of Delaware (unless it becomes,
or any successor Issuer hereunder is or becomes, organized
under the laws of any other state or of the United States of
America, in which case the Issuer will keep in full effect
its existence, rights and franchises under the laws of such
other jurisdiction) and will obtain and preserve its
qualification to do business in each jurisdiction in which
such qualification is or shall be necessary to protect the
validity and enforceability of this Indenture, the Notes, the
Indenture Collateral and each other instrument or agreement
included in the Trust Estate.
SECTION 3.5. Protection of Trust Estate. The Issuer
intends the security interest Granted pursuant to this
Indenture in favor of the Issuer Secured Parties to be prior
to all other liens in respect of the Trust Estate, and the
Issuer shall take all actions necessary to obtain and
maintain, in favor of the Indenture Collateral Agent, for the
benefit of the Issuer Secured Parties, a first lien on and a
first priority, perfected security interest in the Trust
Estate. The Issuer will from time to time execute and
deliver all such supplements and amendments hereto and all
such financing statements, continuation statements,
instruments of further assurance and other instruments, all
as prepared by the Servicer and delivered to the Issuer, and
will take such other action necessary or advisable to:
(i) grant more effectively all or any portion of
the Trust Estate;
(ii) maintain or preserve the lien and security
interest (and the priority thereof) in favor of the
Indenture Collateral Agent for the benefit of the Issuer
Secured Parties created by this Indenture or carry out
more effectively the purposes hereof;
(iii) perfect, publish notice of or protect the
validity of any Grant made or to be made by this
Indenture;
(iv) enforce any of the Indenture Collateral;
(v) preserve and defend title to the Trust Estate
and the rights of the Indenture Collateral Agent in such
Trust Estate against the claims of all persons and
parties; and
(vi) pay all taxes or assessments levied or
assessed upon the Trust Estate when due.
The Issuer hereby designates the Indenture Collateral Agent
its agent and attorney-in-fact to execute any financing
statement, continuation statement or other instrument
required by the Indenture Collateral Agent pursuant to this
Section.
SECTION 3.6. Opinions as to Trust Estate.
(a) On the Closing Date the Issuer shall furnish to the
Trustee, the Indenture Collateral Agent and the Security
Insurer an Opinion of Counsel either stating that, in the
opinion of such counsel, such action has been taken with
respect to the recording and filing of this Indenture, any
indentures supplemental hereto, and any other requisite
documents and with respect to the execution and filing of any
financing statements and continuation statements, as are
necessary to perfect and make effective the first priority
lien and security interest in favor of the Indenture
Collateral Agent, for the benefit of the Issuer Secured
Parties, created by this Indenture and reciting the details
of such action, or stating that, in the opinion of such
counsel, no such action is necessary to make such lien and
security interest effective.
(b) On or before April 1 in each calendar year,
beginning in 1996, the Issuer shall furnish to the Trustee,
the Indenture Collateral Agent and the Security Insurer an
Opinion of Counsel with respect to each jurisdiction in which
a Uniform Commercial Code financing statement has been filed
by the Issuer either stating that, in the opinion of such
counsel, such action has been taken with respect to the
recording, filing, re-recording and refiling of this
Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the execution and
filing of any financing statements and continuation
statements as is necessary to maintain the first priority
lien and security interest created by this Indenture and
reciting the details of such action or stating that in the
opinion of such counsel no such action is necessary to
maintain such lien and security interest. Such Opinion of
Counsel shall also describe the recording, filing, re-
recording and refiling of this Indenture, any indentures
supplemental hereto and any other requisite documents and the
execution and filing of any financing statements and
continuation statements that will, in the opinion of such
counsel, be required to maintain the lien and security
interest of this Indenture until April 1 in the following
calendar year.
SECTION 3.7. Performance of Obligations; Servicing of
Receivables.
(a) The Issuer will not take any action and will use
its best efforts not to permit any action to be taken by
others that would release any Person from any of such
Person's material covenants or obligations under any
instrument or agreement included in the Trust Estate or that
would result in the amendment, hypothecation, subordination,
termination or discharge of, or impair the validity or
effectiveness of, any such instrument or agreement, except as
expressly provided in this Indenture, the Sale and Servicing
Agreement or such other instrument or agreement.
(b) The Issuer may contract with other Persons
acceptable to the Controlling Party to assist it in
performing its duties under this Indenture, and any
performance of such duties by a Person identified to the
Trustee and the Security Insurer in an Officers' Certificate
of the Issuer shall be deemed to be action taken by the
Issuer. Initially, the Issuer has contracted with the
Servicer to assist the Issuer in performing its duties under
this Indenture.
(c) The Issuer will punctually perform and observe all
of its obligations and agreements contained in this
Indenture, the Related Documents and in the instruments and
agreements included in the Trust Estate, including but not
limited to filing or causing to be filed all UCC financing
statements and continuation statements required to be filed
by the terms of this Indenture and the Sale and Servicing
Agreement in accordance with and within the time periods
provided for herein and therein.
(d) If the Issuer shall have knowledge of the
occurrence of a Servicer Termination Event under the Sale and
Servicing Agreement, the Issuer shall promptly notify the
Trustee, the Security Insurer, the Noteholders, the Note
Majority and the Rating Agencies thereof, and shall specify
in such notice the action, if any, the Issuer is taking with
respect thereto. If a Servicer Termination Event shall arise
from the failure of the Servicer to perform any of its duties
or obligations under the Sale and Servicing Agreement with
respect to the Receivables, the Issuer shall take all
reasonable steps available to it to remedy such failure.
(e) If an Insurer Default shall have occurred and be
continuing and if the Issuer has given notice of termination
to the Servicer of the Servicer's rights and powers pursuant
to Section 8.2 of the Sale and Servicing Agreement, as
promptly as possible thereafter, the Issuer shall appoint,
with the consent of the Holders of 66 2/3% of the Outstanding
Amount, a successor servicer in accordance with Section 8.3
of the Sale and Servicing Agreement.
(f) Upon any termination of the Servicer's rights and
powers pursuant to the Sale and Servicing Agreement, the
Issuer shall promptly notify the Trustee. As soon as a
successor Servicer is appointed, the Issuer shall notify the
Trustee of such appointment, specifying in such notice the
name and address of such successor Servicer.
(g) The Issuer agrees that it will not waive timely
performance or observance by the Servicer, the Backup
Servicer, the Seller or AFS of their respective duties under
the Related Documents: (x) without the prior consent of the
Controlling Party or (y) if the effect thereof would
adversely affect the Holders of the Notes.
SECTION 3.8. Negative Covenants. Until the Termination
Date, the Issuer shall not:
(i) except as expressly permitted by this
Indenture, the Purchase Agreement or the Sale and
Servicing Agreement, sell, transfer, exchange or
otherwise dispose of any of the properties or assets of
the Issuer, including those included in the Trust
Estate, unless directed to do so by the Controlling
Party;
(ii) claim any credit on, or make any deduction
from the principal or interest payable in respect of,
the Notes (other than amounts properly withheld from
such payments under the Code) or assert any claim
against any present or former Noteholder by reason of
the payment of the taxes levied or assessed upon any
part of the Trust Estate; or
(iii) (A) permit the validity or effectiveness of
this Indenture to be impaired, or permit the lien in
favor of the Indenture Collateral Agent created by this
Indenture to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be
released from any covenants or obligations with respect
to the Notes under this Indenture except as may be
expressly permitted hereby, (B) permit any lien, charge,
excise, claim, security interest, mortgage or other
encumbrance (other than the lien in favor of the
Indenture Collateral Agent created by this Indenture) to
be created on or extend to or otherwise arise upon or
burden the Trust Estate or any part thereof or any
interest therein or the proceeds thereof (other than tax
liens, mechanics' liens and other liens that arise by
operation of law, in each case on a Financed Vehicle and
arising solely as a result of an action or omission of
the related Obligor), (C) permit the lien in favor of
the Indenture Collateral Agent created by this Indenture
not to constitute a valid first priority (other than
with respect to any such tax, mechanics' or other lien)
security interest in the Trust Estate, or (D) amend,
modify or fail to comply with the provisions of the
Related Documents without the prior written consent of
the Controlling Party.
SECTION 3.9. Annual Statement as to Compliance. The
Issuer will deliver to the Trustee, the Noteholders and the
Security Insurer, within 120 days after the end of each
fiscal year of the Issuer (commencing with the fiscal year
1995), an Officers' Certificate stating, as to the Authorized
Officer signing such Officer's Certificate, that
(i) a review of the activities of the Issuer
during such year and of performance under this Indenture
has been made under such Authorized Officer's
supervision; and
(ii) based on such review, the Issuer has complied
with all conditions and covenants under this Indenture
throughout such year, or, if there has been a default in
the compliance of any such condition or covenant,
specifying each such default known to such Authorized
Officer and the nature and status thereof.
SECTION 3.10. Consolidation and Disposition of Assets.
(a) The Issuer shall not consolidate or merge with or
into any other Person.
(b) The Issuer shall not convey or transfer all or
substantially all of its properties or assets, including
those included in the Trust Estate, to any Person (except as
expressly permitted by this Indenture and the Related
Documents).
SECTION 3.11. Transferee of Issuer.
Upon a conveyance or transfer of all the assets and
properties of the Issuer pursuant to Section 3.10(b), the
Issuer will be released from every covenant and agreement of
this Indenture to be observed or performed on the part of the
Issuer with respect to the Notes immediately upon the
delivery of written notice to the Trustee stating that the
Issuer is to be so released.
SECTION 3.12. No Other Business. The Issuer shall not
engage in any business other than financing, purchasing,
owning, selling and managing the Receivables in the manner
contemplated by this Indenture and the Related Documents and
activities incidental thereto. After the Closing Date, the
Issuer shall not fund the purchase of any new Receivables.
SECTION 3.13. No Borrowing. The Issuer shall not
issue, incur, assume, guarantee or otherwise become liable,
directly or indirectly, for any Indebtedness except for (i)
the Notes, (ii) obligations owing from time to time to the
Security Insurer under the Insurance Agreement and (iii) any
other Indebtedness permitted by or arising under the Issuer's
Related Documents. The proceeds of the Notes shall be used
exclusively to fund the Issuer's purchase of the Receivables
and the other assets specified in the Sale and Servicing
Agreement, to fund the Spread Account and to pay the Issuer's
organizational, transactional and start-up expenses.
SECTION 3.14. Servicer's Obligations. The Issuer shall
cause the Servicer to comply with Sections 3.9, 3.10 and 3.11
of the Sale and Servicing Agreement.
SECTION 3.15. Guarantees, Loans, Advances and Other
Liabilities. Except as contemplated by the Sale and
Servicing Agreement or this Indenture, the Issuer shall not
make any loan or advance or credit to, or guarantee (directly
or indirectly or by an instrument having the effect of
assuming another's payment or performance on any obligation
or capability of so doing or otherwise), endorse or otherwise
become contingently liable, directly or indirectly, in
connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently
to do so) any stock, obligations, assets or securities of,
any other interest in, or make any capital contribution to,
any other Person.
SECTION 3.16. Capital Expenditures. The Issuer shall
not make any expenditure (by long-term or operating lease or
otherwise) for capital assets (either realty or personalty).
SECTION 3.17. Restricted Payments. Except as expressly
permitted by this Indenture or the Sale and Servicing
Agreement, the Issuer shall not, directly or indirectly, (i)
make any distribution (by reduction of capital or otherwise),
whether in cash, property, securities or a combination
thereof, to its shareholder or any owner of a beneficial
interest in the Issuer or otherwise with respect to any
ownership or equity interest or security in or of the Issuer
or to the Servicer, (ii) redeem, purchase, retire or
otherwise acquire for value any such ownership or equity
interest or security or (iii) set aside or otherwise
segregate any amounts for any such purpose. The Issuer will
not, directly or indirectly, make payments to or
distributions from the Collection Account except in
accordance with this Indenture and the Related Documents.
SECTION 3.18. Notice of Events of Default. The Issuer
agrees to give the Trustee, the Security Insurer, the
Noteholders and the Rating Agencies prompt written notice of
each Event of Default hereunder, each default on the part of
the Servicer or the Seller of its obligations under the Sale
and Servicing Agreement and each default on the part of AFS
of its obligations under the Purchase Agreement.
SECTION 3.19. Further Instruments and Acts. Upon
request of the Trustee or the Security Insurer, the Issuer
will execute and deliver such further instruments and do such
further acts as may be reasonably necessary or proper to
carry out more effectively the purpose of this Indenture.
SECTION 3.20. Compliance with Laws. The Issuer shall
comply with the requirements of all applicable laws, the non-
compliance with which would, individually or in the
aggregate, materially and adversely affect the ability of the
Issuer to perform its obligations under the Notes, this
Indenture or any Related Document.
SECTION 3.21. Amendments of Sale and Servicing
Agreement. The Issuer shall not agree to any amendment to
Section 10.1 of the Sale and Servicing Agreement to eliminate
the requirements thereunder that the Trustee or the Holders
of the Notes consent to amendments thereto as provided
therein.
SECTION 3.22. Income Tax Characterization. For
purposes of federal income, state and local income and
franchise and any other income taxes, the Issuer directs the
Trustee to treat the Notes as debt of the Issuer.
ARTICLE IV
Satisfaction and Discharge
SECTION 4.1. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect with
respect to the Notes except as to (i) rights of registration
of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders
to receive payments of principal, interest and premium, if
any, thereon, (iv) Sections 3.3, 3.4, 3.5, 3.7, 3.8, 3.10,
3.12, 3.13, 3.20 and 3.21, (v) the rights, obligations and
immunities of the Trustee hereunder (including the rights of
the Trustee under Section 6.7 and the obligations of the
Trustee under Section 4.2, 5.18 and 5.19) and (vi) the rights
of Noteholders as beneficiaries hereof with respect to the
property so deposited with the Trustee payable to all or any
of them, and the Trustee, on demand of and at the expense of
the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to
the Notes, when
(A) either
(1) all Notes theretofore
authenticated and delivered (other than
(i) Notes that have been destroyed, lost
or stolen and that have been replaced or
paid as provided in Section 2.5 and (ii)
Notes for whose payment money has
theretofore been deposited in trust or
segregated and held in trust by the
Issuer and thereafter repaid to the
Issuer or discharged from such trust, as
provided in Section 3.3) have been
delivered to the Trustee for cancellation
and the Policy has expired and been
returned to the Security Insurer for
cancellation; or
(2) all Notes not theretofore
delivered to the Trustee for cancellation
(i) have become due and
payable, or
(ii) will become due and
payable at the Final Scheduled
Distribution Date within one
year, or
(iii) are to be called for
redemption within one year
under arrangements satisfactory
to the Trustee for the giving
of notice of redemption by the
Trustee in the name, and at the
expense, of the Issuer,
and the Issuer, in the case of (i), (ii) or (iii)
above, has irrevocably deposited or caused to be
irrevocably deposited with the Indenture Collateral
Agent as part of the Trust Estate cash or direct
obligations of or obligations guaranteed by the
United States of America (which will mature prior
to the date such amounts are payable), in trust in
an Eligible Account in the name of the Indenture
Collateral Agent for such purpose, in an amount
sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore
delivered to the Trustee for cancellation when due
to the Final Scheduled Distribution Date or
Redemption Date (if Notes shall have been called
for redemption pursuant to Section 10.1(a)), as the
case may be;
(B) the Issuer has paid or caused to be paid all
Insurer Issuer Obligations and all Trustee Issuer Secured
Obligations; and
(C) the Issuer has delivered to the Trustee, the
Indenture Collateral Agent and the Security Insurer an
Officers' Certificate, an Opinion of Counsel and (if required
by the Trustee, the Indenture Collateral Agent and the
Security Insurer) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable
requirements of Section 11.1(a) and each stating that all
conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been
complied with and the Rating Agency Condition has been
satisfied.
SECTION 4.2. Application of Trust Money. All moneys
deposited with the Trustee pursuant to Section 4.1 hereof
shall be held in trust and applied by it, in accordance with
the provisions of the Notes and this Indenture, to the
payment, either directly or through any Paying Agent, as the
Trustee may determine, to the Holders of the particular Notes
for the payment or redemption of which such moneys have been
deposited with the Trustee, of all sums due and to become due
thereon for principal and interest, but such moneys need not
be segregated from other funds except to the extent required
herein or in the Sale and Servicing Agreement or required by
law and shall be held by the Trustee uninvested or invested
in Eligible Investments which meet the criteria specified in
(a)(i) of the definition of Eligible Investments.
SECTION 4.3. Payment of Moneys Held by Paying Agent. In
connection with the satisfaction and discharge of this
Indenture with respect to the Notes, all moneys then held by
any Paying Agent other than the Trustee under the provisions
of this Indenture with respect to such Notes shall, upon
demand of the Issuer, be paid to the Trustee to be held and
applied according to Section 3.3 and thereupon such Paying
Agent shall be released from all further liability with
respect to such moneys.
Section 4.4. Release of Trust Estate. The Indenture
Collateral Agent shall, on or after the Termination Date,
release any remaining portion of the Trust Estate from the
lien created by this Indenture and deposit in the Collection
Account any funds then on deposit in any other Trust Account.
The Indenture Collateral Agent shall release property from
the lien created by this Indenture pursuant to this Section
4.4 only upon receipt of an Issuer Request accompanied by an
Officer's Certificate and an Opinion of Counsel. The Trustee
shall surrender the Policy to the Security Insurer upon the
expiration of the Term of the Policy (as defined in Section 1
of the Policy).
ARTICLE V
Remedies
SECTION 5.1. Events of Default. "Event of Default,"
wherever used herein, means any one of the following events
(whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation
of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative
or governmental body):
(i) default in the payment of any interest on
any Note when the same becomes due and payable, and
such default shall continue for a period of five
days (solely for purposes of this clause, a payment
on the Notes funded by the Security Insurer or the
Indenture Collateral Agent shall be deemed to be a
payment made by the Issuer); or
(ii) default in the payment of the principal
of or any installment of the principal of any Note
when the same becomes due and payable (solely for
purposes of this clause, a payment on the Notes
funded by the Security Insurer or the Indenture
Collateral Agent shall be deemed to be a payment
made by the Issuer); or
(iii) so long as an Insurer Default shall not
have occurred and be continuing an Insurance
Agreement Event of Default shall have occurred;
provided, however, that the occurrence of an
Insurance Agreement Event of Default may not form
the basis of an Event of Default unless the
Security Insurer shall, upon prior written notice
to the Rating Agencies, have delivered to the
Issuer and the Trustee and not rescinded a written
notice specifying that such Insurance Agreement
Event of Default constitutes an Event of Default
under this Indenture;
(iv) so long as an Insurer Default shall have
occurred and be continuing, default in the
observance or performance of any covenant or
agreement of the Issuer made in this Indenture
(other than a covenant or agreement, a default in
the observance or performance of which is elsewhere
in this Section specifically dealt with), or any
representation or warranty of the Issuer made in
this Indenture or in any certificate or other
writing delivered pursuant hereto or in connection
herewith proving to have been incorrect in any
material respect as of the time when the same shall
have been made, and such default shall continue or
not be cured, or the circumstance or condition in
respect of which such misrepresentation or warranty
was incorrect shall not have been eliminated or
otherwise cured, for a period of 30 days after
knowledge thereof by the Issuer or there shall have been
given, by registered or certified mail, to the Issuer by
the Trustee or to the Issuer and the Trustee by the
Holders of at least 25% of the Outstanding Amount of the
Notes, a written notice specifying such default or
incorrect representation or warranty and requiring it to
be remedied and stating that such notice is a "Notice of
Default" hereunder; or
(v) so long as an Insurer Default shall have
occurred and be continuing, the filing of a decree
or order for relief by a court having jurisdiction
in the premises in respect of the Issuer or any
substantial part of the Trust Estate in an
involuntary case under any applicable Federal or
state bankruptcy, insolvency or other similar law
now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or
for any substantial part of the Trust Estate, or
ordering the winding-up or liquidation of the
Issuer's affairs, and such decree or order shall
remain unstayed and in effect for a period of 60
consecutive days; or
(vi) so long as an Insurer Default shall have
occurred and be continuing, the commencement by the
Issuer of a voluntary case under any applicable
Federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect, or the
consent by the Issuer to the entry of an order for
relief in an involuntary case under any such law,
or the consent by the Issuer to the appointment or
taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or
similar Official of the Issuer or for any
substantial part of the Trust Estate, or the making
by the Issuer of any general assignment for the
benefit of creditors, or the failure by the Issuer
generally to pay its debts as such debts become
due, or the taking of action by the Issuer in
furtherance of any of the foregoing.
The Issuer shall deliver to the Trustee and the Security
Insurer, within five days after obtaining knowledge of the
occurrence thereof, written notice in the form of an
Officers' Certificate of any event which with the giving of
notice and the lapse of time would become an Event of Default
under clause (iii), its status and what action the Issuer is
taking or proposes to take with respect thereto.
SECTION 5.2. Rights upon Event of Default.
(a) If an Insurer Default shall not have occurred and
be continuing and an Event of Default shall have occurred and
be continuing the Notes shall become immediately due and
payable at one hundred percent (100%) of their outstanding
principal balance, together with accrued interest thereon.
In the event of any acceleration of the Notes by operation of
this Section 5.2, the Trustee shall continue to be entitled
to make claims under the Policy pursuant to Section 5.18
hereof for Scheduled Payments on the Notes. Payments under
the Policy following acceleration of the Notes shall be
applied by the Trustee:
FIRST: to Noteholders for amounts due and
unpaid on the Notes for interest, ratably, without
preference or priority of any kind, according to
the amounts due and payable on the Notes for
interest, and
SECOND: to Noteholders for amounts due and
unpaid on the Notes for principal, ratably, without
preference or priority of any kind, according to
the amounts due and payable on the Notes for
principal.
(b) In the event the Notes are accelerated due to an
Event of Default, the Security Insurer shall have the right
(in addition to its obligation to pay Scheduled Payments on
the Notes in accordance with the Policy), but not the
obligation, to make payments under the Policy or otherwise of
interest and principal due on the Notes, in whole or in part,
on any date or dates following such acceleration as the
Security Insurer, in its sole discretion, shall elect.
(c) If an Insurer Default shall have occurred and be
continuing and an Event of Default shall have occurred and be
continuing the Trustee in its discretion may, or if so
requested in writing by Holders holding Notes representing at
least 66-2/3% of the aggregate outstanding principal amount
of the Notes shall, upon prior written notice to the Rating
Agencies, declare by written notice to the Issuer that the
Notes become, whereupon they shall become, immediately due
and payable at one hundred percent (100%) of their
outstanding principal balance, together with accrued interest
thereon. Notwithstanding anything to the contrary in this
paragraph (c), if an Event of Default specified in Section
5.1(v) and (vi) shall occur and be continuing when an Insurer
Default has occurred and is continuing the Notes shall become
immediately due and payable at par, together with accrued
interest thereon.
SECTION 5.3. Collection of Indebtedness and Suits for
Enforcement by Trustee; Authority of Controlling Party.
(a) The Issuer covenants that if the Notes are
accelerated following the occurrence of an Event of Default,
the Issuer will, upon demand of the Trustee, pay to it, for
the benefit of the Holders of the Notes, the whole amount
then due and payable on such Notes for principal and
interest, with interest upon the overdue principal, and, to
the extent payment at such rate of interest shall be legally
enforceable, upon overdue installments of interest, at the
Note Interest Rate and in addition thereto such further
amount as shall be sufficient to cover the costs and expenses
of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee and its
agents and counsel.
(b) Each Issuer Secured Party hereby irrevocably and
unconditionally appoints the Controlling Party as the true
and lawful attorney-in-fact of such Issuer Secured Party for
so long as such Issuer Secured Party is not the Controlling
Party, with full power of substitution, to execute,
acknowledge and deliver any notice, document, certificate,
paper, pleading or instrument and to do in the name of the
Controlling Party as well as in the name, place and stead of
such Issuer Secured Party such acts, things and deeds for or
on behalf of and in the name of such Issuer Secured Party
under this Indenture (including specifically under Section
5.4) and under the Related Documents which such Issuer
Secured Party could or might do or which may be necessary,
desirable or convenient in such Controlling Party's sole
discretion to effect the purposes contemplated hereunder and
under the Related Documents and, without limitation,
following the occurrence of an Event of Default, exercise
full right, power and authority to take, or defer from
taking, any and all acts with respect to the administration,
maintenance or disposition of the Trust Estate.
(c) If an Event of Default occurs and is continuing,
the Trustee may at the direction of the Controlling Party
(except as provided in Section 5.3(d) below), proceed to
protect and enforce its rights and the rights of the
Noteholders, by such appropriate Proceedings as the Trustee
shall deem most effective to protect and enforce any such
rights, whether for the specific enforcement of any covenant
or agreement in this Indenture or in aid of the exercise of
any power granted herein, or to enforce any other proper
remedy or legal or equitable right vested in the Trustee by
this Indenture or by law.
(d) In case there shall be pending, relative to the
Issuer or any other obligor upon the Notes or any Person
having or claiming an ownership interest in the Trust Estate,
Proceedings under Title 11 of the United States Code or any
other applicable Federal or state bankruptcy, insolvency or
other similar law, or in case a receiver, assignee or trustee
in bankruptcy or reorganization, liquidator, sequestrator or
similar official shall have been appointed for or taken
possession of the Issuer or its Property or such other
obligor or Person, or in case of any other comparable
judicial Proceedings relative to the Issuer or other obligor
upon the Notes, or to the creditors or property of the Issuer
or such other obligor, the Trustee, irrespective of whether
the principal of any Notes shall then be due and payable as
therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any
demand pursuant to the provisions of this Section, shall be
entitled and empowered, by intervention in such Proceedings
or otherwise:
(i) to file and prove a claim or claims for
the whole amount of principal, interest and
premium, if any, owing and unpaid in respect of the
Notes and to file such other papers or documents as
may be necessary or advisable in order to have the
claims of the Trustee (including any claim for
reasonable compensation to the Trustee and each
predecessor Trustee, and their respective agents,
attorneys and counsel, and for reimbursement of all
expenses and liabilities incurred, and all advances
made, by the Trustee and each predecessor Trustee,
except as a result of negligence or bad faith) and
of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of
Notes in any election of a trustee, a standby
trustee or Person performing similar functions in
any such Proceedings;
(iii) to collect and receive any moneys or
other property payable or deliverable on any such
claims and to distribute all amounts received with
respect to the claims of the Noteholders and of the
Trustee on their behalf; and
(iv) to file such proofs of claim and other
papers or documents as may be necessary or
advisable in order to have the claims of the
Trustee or the Holders of Notes allowed in any
judicial proceedings relative to the Issuer, its
creditors and its property;
and any trustee, receiver, liquidator, custodian or other
similar official in any such Proceeding is hereby authorized
by each of such Noteholders to make payments to the Trustee,
and, in the event that the Trustee shall consent to the
making of payments directly to such Noteholders, to pay to
the Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Trustee, each predecessor
Trustee and their respective agents, attorneys and counsel,
and all other expenses and liabilities incurred, and all
advances made, by the Trustee and each predecessor Trustee
except as a result of negligence or bad faith.
(e) Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or vote for
or accept or adopt on behalf of any Noteholder any plan of
reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof or to
authorize the Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to
vote for the election of a trustee in bankruptcy or similar
Person.
(f) All rights of action and of asserting claims under
this Indenture or under any of the Notes or, if an Insurer
Default shall have occurred and be continuing, under the
Spread Account Agreement, may be enforced by the Trustee
without the possession of any of the Notes or the production
thereof in any trial or other Proceedings relative thereto,
and any such action or Proceedings instituted by the Trustee
shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment
of the expenses, disbursements and compensation of the
Trustee, each predecessor Trustee and their respective agents
and attorneys, shall be for the ratable benefit of the
Holders of the Notes.
(g) In any Proceedings brought by the Trustee
(including any Proceedings involving the interpretation of
any provision of this Indenture or, if an Insurer Default
shall have occurred and be continuing, under the Spread
Account Agreement), the Trustee shall be held to represent
all the Holders of the Notes, and it shall not be necessary
to make any Noteholder a party to any such Proceedings.
SECTION 5.4. Remedies. (a) If an Event of Default shall
have occurred and be continuing the Controlling Party may
(subject to Section 5.5):
(i) institute Proceedings in its own name and
as or on behalf of a trustee of an express trust
for the collection of all amounts then payable on
the Notes or under this Indenture with respect
thereto, whether by declaration or otherwise,
enforce any judgment obtained, and collect from the
Issuer and any other obligor upon such Notes moneys
adjudged due,
(ii) institute Proceedings from time to time
for the complete or partial foreclosure of this
Indenture with respect to the Trust Estate;
(iii) exercise any remedies of a secured party
under the UCC and any other remedy available to the
Trustee and take any other appropriate action to
protect and enforce the rights and remedies of the
Issuer Secured Parties; and
(iv) direct the Indenture Collateral Agent to
sell the Trust Estate or any portion thereof or
rights or interest therein, at one or more public
or private sales called and conducted in any manner
permitted by law; provided, however, that, if the
Trustee is the Controlling Party, the Trustee may
not sell or otherwise liquidate the Trust Estate
following an Event of Default, other than an Event
of Default described in Section 5.1(i) or (ii),
unless (A) the Holders of 100% of the Outstanding
Amount of the Notes consent thereto, (B) the
proceeds of such sale or liquidation distributable
to the Noteholders are sufficient to discharge in
full all amounts then due and unpaid upon such
Notes for principal and interest or (C) the Trustee
determines that the Trust Estate will not continue
to provide sufficient funds for the payment of
principal of and interest on the Notes as they
would have become due if the Notes had not been declared
due and payable, and the Trustee provides prior written
notice to the Rating Agencies and obtains the consent of
Holders of 66-2/3% of the Outstanding Amount of the
Notes. In determining such sufficiency or insufficiency
with respect to clause (B) and (C), the Trustee may, but
need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of
national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Trust
Estate for such purpose.
SECTION 5.5. Optional Preservation of the Receivables.
If the Trustee is Controlling Party and if the Notes have
been declared to be due and payable under Section 5.2
following an Event of Default and such declaration and its
consequences have not been rescinded and annulled, the
Trustee may, but need not, elect to maintain possession of
the Trust Estate. It is the desire of the parties hereto and
the Noteholders that there be at all times sufficient funds
for the payment of principal of and interest on the Notes,
and the Trustee shall take such desire into account when
determining whether or not to maintain possession of the
Trust Estate. In determining whether to maintain possession
of the Trust Estate, the Trustee may, but need not, obtain
and rely upon an opinion of an Independent investment banking
or accounting firm of national reputation as to the
feasibility of such proposed action and as to the sufficiency
of the Trust Estate for such purpose.
SECTION 5.6. Priorities.
(a) If the Trustee collects any money or property
pursuant to this Article V (excluding any payments made under
the Policy), or if the Indenture Collateral Agent delivers
any money or property in respect of liquidation of the Trust
Estate to the Trustee pursuant to Section 5.4(a)(iv), the
Trustee shall pay out the money or property in the following
order:
FIRST: amounts due and owing and required to
be distributed to the Servicer, the Trustee, the
Lockbox Bank, the Custodian, the Backup Servicer,
the Collateral Agent and the Indenture Collateral
Agent, respectively, pursuant to priorities (i) and
(ii) of Section 4.6 of the Sale and Servicing
Agreement and not previously distributed, in the
order of such priorities and without preference or
priority of any kind within such priorities;
SECOND: to Noteholders for amounts due and
unpaid on the Notes for interest, ratably, without
preference or priority of any kind, according to
the amounts due and payable on the Notes for
interest;
THIRD: to Noteholders for amounts due and
unpaid on the Notes for principal, ratably, without
preference or priority of any kind, according to
the amounts due and payable on the Notes for
principal;
FOURTH: amounts due and owing and required to
be distributed to the Security Insurer pursuant to
priority (v) of Section 4.6 of the Sale and
Servicing Agreement and not previously distributed;
and
FIFTH: to the Collateral Agent to be applied
as provided in the Spread Account Agreement.
The Trustee may fix a record date and payment date for
any payment to Noteholders pursuant to this Section. At
least 15 days before such record date, the Issuer shall mail
to each Noteholder and the Trustee a notice that states the
record date, the payment date and the amount to be paid.
SECTION 5.7. Limitation of Suits. No Holder of any
Note shall have any right to institute any Proceeding,
judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(i) such Holder has previously given written
notice to the Trustee of a continuing Event of Default,
(ii) the Holders of not less than 20% of the
Outstanding Amount of the Notes have made written
request to the Trustee to institute such Proceeding in
respect of such Event of Default in its own name as
Trustee hereunder;
(iii) such Holder or Holders have offered to the
Trustee reasonable indemnity against the costs, expenses
and liabilities to be incurred in complying with such
request,
(iv) the Trustee for 30 days after its receipt of
such notice, request and offer of indemnity has failed
to institute such Proceedings;
(v) no direction inconsistent with such written
request has been given to the Trustee during such 30-day
period by the Holders of 66 2/3% of the Outstanding
Amount of the Notes; and
(vi) an Insurer Default shall have occurred and be
continuing;
it being understood and intended that no one or more Holders
of Notes shall have any right in any manner whatever by
virtue of, or by availing of, any provision of this Indenture
to affect, disturb or prejudice the rights of any other
Holders of Notes or to obtain or to seek to obtain priority
or preference over any other Holders or to enforce any right
under this Indenture, except in the manner herein provided.
In the event the Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups
of Holders of Notes, each representing less than a majority
of the Outstanding Amount of the Notes, the Trustee in its
sole discretion may determine what action, if any, shall be
taken, notwithstanding any other provisions of this
Indenture.
SECTION 5.8. Unconditional Rights of Noteholders To
Receive Principal and Interest. Notwithstanding any other
provisions in this Indenture, the Holder of any Note shall
have the right, which is absolute and unconditional, to
receive payment of the principal of and interest on such Note
on or after the respective due dates thereof expressed in
such Note or in this Indenture (or, in the case of
redemption, on or after the Redemption Date) and to institute
suit for the enforcement of any such payment, and such right
shall not be impaired without the consent of such Holder;
provided, however, that so long as an Insurer Default shall
not have occurred and be continuing no such suit shall be
instituted.
SECTION 5.9. Restoration of Rights and Remedies. If
the Controlling Party or any Noteholder has instituted any
Proceeding to enforce any right or remedy under this
Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to
the Trustee or to such Noteholder, then and in every such
case the Issuer, the Trustee and the Noteholders shall,
subject to any determination in such Proceeding be restored
severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the
Trustee and the Noteholders shall continue as though no such
Proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative. No right
or remedy herein conferred upon or reserved to the
Controlling Party or to the Noteholders is intended to be
exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative
and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 5.11. Delay or Omission Not a Waiver. No delay
or omission of the Controlling Party or any Holder of any
Note to exercise any right or remedy accruing upon any
Default or Event of Default shall impair any such right or
remedy or constitute a waiver of any such Default or Event of
Default or an acquiescence therein. Every right and remedy
given by this Article V or by law to the Trustee or to the
Noteholders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the
Noteholders, as the case may be.
SECTION 5.12. Control by Noteholders. If the Trustee
is the Controlling Party, the Holders of 66 2/3% of the
Outstanding Amount of the Notes shall have the right to
direct the time, method and place of conducting any
Proceeding for any remedy available to the Trustee with
respect to the Notes or exercising any trust or power
conferred on the Trustee; provided that
(i) such direction shall not be in conflict with
any rule of law or with this Indenture;
(ii) subject to the express terms of Section 5.4,
any direction to the Trustee to sell or liquidate the
Trust Estate shall be by the Holders of Notes
representing not less than 100% of the Outstanding
Amount of the Notes;
(iii) if the conditions set forth in Section 5.5
have been satisfied and the Trustee elects to retain the
Trust Estate pursuant to such Section, then any
direction to the Trustee by Holders of Notes
representing less than 100% of the Outstanding Amount of
the Notes to sell or liquidate the Trust Estate shall be
of no force and effect; and
(iv) the Trustee may take any other action deemed
proper by the Trustee that is not inconsistent with such
direction; provided, however, that, subject to Section
6.1, the Trustee need not take any action that it
determines might involve it in liability or might
materially adversely affect the rights of any
Noteholders not consenting to such action.
SECTION 5.13. Waiver of Past Defaults. If an Insurer
Default shall have occurred and be continuing, the Holders of
Notes of not less than 66 2/3% of the Outstanding Amount of
the Notes may waive any past Default or Event of Default and
its consequences except a Default (a) in payment of principal
of or interest on any of the Notes or (b) in respect of a
covenant or provision hereof which cannot be modified or
amended without the consent of the Holder of each Note. In
the case of any such waiver, the Issuer, the Trustee and the
Holders of the Notes shall be restored to their former
positions and rights hereunder, respectively; but no such
waiver shall extend to any subsequent or other Default or
Event of Default or impair any right consequent thereto.
Upon any such waiver, such Default shall cease to exist
and be deemed to have been cured and not to have occurred,
and any Event of Default arising therefrom shall be deemed to
have been cured and not to have occurred, for every purpose
of this Indenture; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any
right consequent thereto.
SECTION 5.14. Undertaking for Costs. All parties to
this Indenture agree, and each Holder of any Note by such
Holder's acceptance thereof shall be deemed to have agreed,
that any court may in its discretion require, in any suit for
the enforcement of any right or remedy under this Indenture,
or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of
such suit and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section shall
not apply to (a) any suit instituted by the Trustee, (b) any
suit instituted by any Noteholder, or group of Noteholders,
in each case holding in the aggregate more than 10% of the
Outstanding Amount of the Notes or (c) any suit instituted by
any Noteholder for the enforcement of the payment of
principal of or interest on any Note on or after the
respective due dates expressed in such Note and in this
Indenture (or, in the case of redemption, on or after the
Redemption Date).
SECTION 5.15. Waiver of Stay or Extension Laws. The
Issuer covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead or in any
manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any
time hereafter in force, that may affect the covenants or the
performance of this Indenture; and the Issuer (to the extent
that it may lawfully do so) hereby expressly waives all
benefit or advantages of any such law, and covenants that it
will not hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been
enacted.
SECTION 5.16. Action on Notes. The Trustee's right to
seek and recover judgment on the Notes or under this
Indenture shall not be affected by the seeking, obtaining or
application of any other relief under or with respect to this
Indenture. Neither the lien of this Indenture nor any rights
or remedies of the Trustee or the Noteholders shall be
impaired by the recovery of any judgment by the Trustee
against the Issuer or by the levy of any execution under such
judgment upon any portion of the Trust Estate or upon any of
the assets of the Issuer.
SECTION 5.17. Performance and Enforcement of Certain
Obligations.
(a) Promptly following a request from the Trustee to do
so and at the Seller's expense, the Issuer agrees to take all
such lawful action as the Trustee may request to compel or
secure the performance and observance by the Seller, the
Servicer and AFS, as applicable of each of their obligations
to the Issuer under or in connection with the Sale and
Servicing Agreement or to the Seller under or in connection
with the Purchase Agreement in accordance with the terms
thereof, and to exercise any and all rights, remedies, powers
and privileges lawfully available to the Issuer under or in
connection with the Sale and Servicing Agreement to the
extent and in the manner directed by the Trustee, including
the transmission of notices of default on the part of the
Seller or the Servicer thereunder and the institution of
legal or administrative actions or proceedings to compel or
secure performance by the Seller or the Servicer of each of
their obligations under the Sale and Servicing Agreement.
(b) If the Trustee is Controlling Party and if an Event
of Default has occurred and is continuing the Trustee may,
and at the direction (which direction shall be in writing,
including facsimile) of the Holders of 66-2/3% of the
Outstanding Amount of the Notes shall, exercise all rights,
remedies, powers, privileges and claims of the Issuer against
the Seller or the Servicer under or in connection with the
Sale and Servicing Agreement, including the right or power to
take any action to compel or secure performance or observance
by the Seller or the Servicer of each of their obligations to
the Issuer thereunder and to give any consent, request,
notice, direction, approval, extension or waiver under the
Sale and Servicing Agreement, and any right of the Issuer to
take such action shall be suspended.
(c) Promptly following a request from the Trustee to do
so and at the Seller's expense, the Issuer agrees to take all
such lawful action as the Trustee may request to compel or
secure the performance and observance by AFS of each of its
obligations to the Seller under or in connection with the
Purchase Agreement in accordance with the terms thereof, and
to exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuer under or in
connection with the Purchase Agreement to the extent and in
the manner directed by the Trustee, including the
transmission of notices of default on the part of the Seller
thereunder and the institution of legal or administrative
actions or proceedings to compel or secure performance by AFS
of each of its obligations under the Purchase Agreement.
(d) If the Trustee is Controlling Party and if an Event
of Default has occurred and is continuing the Trustee may,
and at the direction (which direction shall be in writing,
including facsimile) of the Holders of 66-2/3% of the
Outstanding Amount of the Notes shall, exercise all rights,
remedies, powers, privileges and claims of the Seller against
AFS under or in connection with the Purchase Agreement,
including the right or power to take any action to compel or
secure performance or observance by AFS of each of its
obligations to the Seller thereunder and to give any consent,
request, notice, direction, approval, extension or waiver
under the Purchase Agreement, and any right of the Seller to
take such action shall be suspended.
SECTION 5.18. Claims Under Policy.
(a) In the event that the Trustee has delivered a
Deficiency Notice with respect to any Determination Date
pursuant to Section 5.1 of the Sale and Servicing Agreement,
the Trustee shall determine on the related Draw Date whether
the sum of (i) the amount of Available Funds with respect to
such Determination Date (as stated in the Servicer's
Certificate with respect to such Determination Date), and
(ii) the amount of the Deficiency Claim Amount, if any,
distributed by the Collateral Agent pursuant to the Spread
Account Agreement to the Trustee pursuant to a Deficiency
Notice delivered with respect to such Payment Date (as stated
in the certificate delivered on the immediately preceding
Deficiency Claim Date to the Collateral Agent pursuant to
Section 3.03(a) of the Spread Account Agreement) would be
insufficient, after giving effect to the distributions
required by Section 4.6(i)-(ii) of the Sale and Servicing
Agreement, to pay the sum of the Noteholders' Interest
Distributable Amount and the Noteholders' Principal
Distributable Amount for the related Payment Date, then in
such event the Trustee shall furnish to the Security Insurer
no later than 12:00 noon New York City time on the related
Draw Date a completed Notice of Claim in the amount of the
shortfall in amounts so available to pay the Noteholders'
Interest Distributable Amount and the Noteholders' Principal
Distributable Amount with respect to such Payment Date (the
amount of any such shortfall being hereinafter referred to as
the "Policy Claim Amount"). Amounts paid by the Security
Insurer pursuant to a claim submitted under this Section
5.18(a) shall be deposited by the Trustee into the Note
Distribution Account for payment to Noteholders on the
related Payment Date.
(b) Any notice delivered by the Trustee to the Security
Insurer pursuant to subsection 5.18(a) shall specify the
Policy Claim Amount claimed under the Policy and shall
constitute a "Notice of Claim" under the Policy. In
accordance with the provisions of the Policy, the Security
Insurer is required to pay to the Trustee the Policy Claim
Amount properly claimed thereunder by 12:00 noon, New York
City time, on the later of (i) the third Business Day
following receipt on a Business Day of the Notice of Claim,
and (ii) the applicable Payment Date. Any payment made by
the Security Insurer under the Policy shall be applied solely
to the payment of the Notes, and for no other purpose.
(c) The Trustee shall (i) receive as attorney-in-fact
of each Noteholder any Policy Claim Amount from the Security
Insurer and (ii) deposit the same in the Note Distribution
Account for distribution to Noteholders as provided in
Section 3.1 or Section 5.2 of this Indenture. Any and all
Policy Claim Amounts disbursed by the Trustee from claims
made under the Policy shall not be considered payment by the
Issuer or from the Spread Account with respect to such Notes,
and shall not discharge the obligations of the Issuer with
respect thereto. The Security Insurer shall, to the extent
it makes any payment with respect to the Notes, become
subrogated to the rights of the recipients of such payments
to the extent of such payments. Subject to and conditioned
upon any payment with respect to the Notes by or on behalf of
the Security Insurer, the Trustee shall assign to the
Security Insurer all rights to the payment of interest or
principal with respect to the Notes which are then due for
payment to the extent of all payments made by the Security
Insurer and the Security Insurer may exercise any option,
vote, right, power or the like with respect to the Notes to
the extent that it has made payment pursuant to the Policy.
To evidence such subrogation, the Note Registrar shall note
the Security Insurer's rights as subrogee upon the register
of Noteholders upon receipt from the Security Insurer of
proof of payment by the Security Insurer of any Noteholders'
Interest Distributable Amount or Noteholders' Principal
Distributable Amount and upon the surrender or presentment of
any Note for payment, the Trustee shall stamp on such Note
the legend "$[insert applicable amount] paid by Financial
Security and the balance hereof has been cancelled and
reissued." The foregoing subrogation shall in all cases be
subject to the rights of the Noteholders to receive all
Scheduled Payments in respect of the Notes.
(d) The Trustee shall keep a complete and accurate
record of all funds deposited by the Security Insurer into
the Collection Account and the allocation of such funds to
payment of interest on and principal paid in respect of any
Note. The Security Insurer shall have the right to inspect
such records at reasonable times upon one Business Day's
prior notice to the Trustee.
(e) The Trustee shall be entitled to enforce on behalf
of the Noteholders the obligations of the Security Insurer
under the Policy. Notwithstanding any other provision of
this Indenture or any Related Document, the Noteholders are
not entitled to institute proceedings directly against the
Security Insurer.
SECTION 5.19. Preference Claims.
(a) In the event that the Trustee has received a
certified copy of an order of the appropriate court that any
Noteholders' Interest Distributable Amount or Noteholders'
Principal Distributable Amount paid on a Note has been
avoided in whole or in part as a preference payment under
applicable bankruptcy law, the Trustee shall so notify the
Security Insurer, shall comply with the provisions of the
Policy to obtain payment by the Security Insurer of such
avoided payment, and shall, at the time it provides notice to
the Security Insurer, notify Holders of the Notes by mail
that, in the event that any Noteholder's payment is so
recoverable, such Noteholder will be entitled to payment
pursuant to the terms of the Policy. The Trustee shall
furnish to the Security Insurer its records evidencing the
payments of principal of and interest on the Notes, if any,
which have been made by the Trustee so recoverable or
recoverable or recovered from Noteholders, and the dates on
which such payments were made. Pursuant to the terms of the
Policy, the Security Insurer will make such payment on behalf
of the Noteholders to the receiver, conservator, debtor-in-
possession or trustee in bankruptcy named in the Order (as
defined in the Policy) and not to the Trustee or any
Noteholder directly (unless a Noteholder has previously paid
such payment to the receiver, conservator, debtor-in-
possession or trustee in bankruptcy, in which case the
Security Insurer will make such payment to the Trustee for
distribution to such Noteholder upon proof of such payment
reasonably satisfactory to the Security Insurer).
(b) The Trustee shall promptly notify the Security
Insurer of any proceeding or the institution of any action
(of which the Trustee has actual knowledge) seeking the
avoidance as a preferential transfer under applicable
bankruptcy, insolvency, receivership, rehabilitation or
similar law (a "Preference Claim") of any distribution made
with respect to the Notes. Each Holder, by its purchase of
Notes, and the Trustee hereby agree that so long as an
Insurer Default shall not have occurred and be continuing,
the Security Insurer may at any time during the continuation
of any proceeding relating to a Preference Claim direct all
matters relating to such Preference Claim including, without
limitation, (i) the direction of any appeal of any order
relating to any Preference Claim and (ii) the posting of any
surety, supersedeas or performance bond pending any such
appeal at the expense of the Security Insurer, but subject to
reimbursement as provided in the Insurance Agreement. In
addition, and without limitation of the foregoing, as set
forth in Section 5.18(c), the Security Insurer shall be
subrogated to, and each Noteholder and the Trustee hereby
delegate and assign, to the fullest extent permitted by law,
the rights of the Trustee and each Noteholder in the conduct
of any proceeding with respect to a Preference Claim,
including, without limitation, all rights of any party to an
adversary proceeding action with respect to any court order
issued in connection with any such Preference Claim.
ARTICLE VI
The Trustee and the Indenture Collateral Agent
SECTION 6.1. Duties of Trustee.
(a) If an Event of Default has occurred and is
continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and in the same degree of care
and skill in their exercise as a prudent person would
exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) Except during the continuance of an Event of
Default:
(i) the Trustee undertakes to perform such
duties and only such duties as are specifically set
forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture
against the Trustee; and
(ii) in the absence of bad faith on its part,
the Trustee may conclusively rely, as to the truth
of the statements and the correctness of the
opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to
the requirements of this Indenture; however, the
Trustee shall examine the certificates and opinions
to determine whether or not they conform on their
face to the requirements of this Indenture and, if
applicable, the Spread Account Agreement and the
Trustee's other Related Documents.
(c) The Trustee may not be relieved from liability for
its own negligent action, its own grossly negligent failure
to act or its own wilful misconduct, except that:
(i) this paragraph does not limit the effect
of paragraph (b) of this Section;
(ii) the Trustee shall not be liable for any
error of judgment made in good faith by a
Responsible Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Trustee shall not be liable with
respect to any action it takes or omits to take in
good faith in accordance with a direction received
by it pursuant to any provision of this Indenture.
(d) Every provision of this Indenture that in any way
relates to the Trustee is subject to paragraphs (a), (b) and
(c) of this Section.
(e) The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in
writing with the Issuer.
(f) Money held in trust by the Trustee need not be
segregated from other funds except to the extent required by
law or the terms of this Indenture or the Sale and Servicing
Agreement.
(g) No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur
financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers,
if it shall have reasonable grounds to believe that
repayments of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
(h) Every provision of this Indenture relating to the
conduct or affecting the liability of or affording protection
to the Trustee shall be subject to the provisions of this
Section.
(i) The Trustee shall, upon one Business Day's prior
notice to the Trustee, permit any representative of the
Noteholders, Security Insurer, or the Issuer, during the
Trustee's normal business hours, to examine all books of
account, records, reports and other papers of the Trustee
relating to the Notes, to make copies and extracts therefrom
and to discuss the Trustee's affairs and actions, as such
affairs and actions relate to the Trustee's duties with
respect to the Notes, with the Trustee's officers and
employees responsible for carrying out the Trustee's duties
with respect to the Notes.
(j) In no event shall the Trustee be required to
perform, or be responsible for the manner of performance of,
any of the obligations of the Servicer, or any other party,
under the Sale and Servicing Agreement except that LaSalle
National Bank solely in its capacity as Backup Servicer shall
perform and be responsible for such obligations during such
time, if any, as the Backup Servicer shall be the successor
to, and be vested with the rights, powers, duties and
privileges of the Servicer in accordance with the terms of
the Sale and Servicing Agreement.
(k) The Trustee shall, and hereby agrees that it will,
perform all of the obligations and duties required of it
under the Sale and Servicing Agreement.
(l) The Trustee shall, and hereby agrees that it will,
hold the Policy in trust, and will hold any proceeds of any
claim on the Policy in trust solely for the use and benefit
of the Noteholders. The Trustee will deliver to the Rating
Agency notice of any change made to the Policy prior to the
Termination Date.
(m) Without limiting the generality of this Section
6.1, the Trustee, in its capacity as Trustee, shall have no
duty (i) to see to any recording, filing or depositing of
this Indenture or any agreement referred to herein or any
financing statement evidencing a security interest in the
Financed Vehicles, or to see to the maintenance of any such
recording or filing or depositing or to any recording,
refiling or redepositing of any thereof, (ii) to see to any
insurance of the Financed Vehicles or Obligors or to effect
or maintain any such insurance, (iii) to see to the payment
or discharge of any tax, assessment or other governmental
charge or any Lien or encumbrance of any kind owing with
respect to, assessed or levied against any part of the Trust,
(iv) to confirm or verify the contents of any reports or
certificates delivered to the Trustee pursuant to this
Indenture or the Sale and Servicing Agreement believed by the
Trustee to be genuine and to have been signed or presented by
the proper party or parties, or (v) to inspect the Financed
Vehicles at any time or ascertain or inquire as to the
performance or observance of any of the Issuer's, the
Seller's or the Servicer's representations, warranties or
covenants or the Servicer's duties and obligations as
Servicer and as custodian of the Receivable Files under the
Custodian Agreement.
SECTION 6.2. Rights of Trustee.
(a) The Trustee may rely on any document believed by it
to be genuine and to have been signed or presented by the
proper person. The Trustee need not investigate any fact or
matter stated in the document.
(b) Other than with respect to actions required to be
taken by the Trustee pursuant to Section 5.18 and 5.19,
before the Trustee acts or refrains from acting, it may
require an Officers' Certificate (with respect to factual
matters) or an Opinion of Counsel, as applicable. The
Trustee shall not be liable for any action it takes or omits
to take in good faith in reliance on the Officers'
Certificate or Opinion of Counsel, as applicable, or as
directed by the requisite amount of Noteholders as provided
herein.
(c) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or
by or through agents or attorneys or a custodian or nominee,
and the Trustee shall not be responsible for any misconduct
or negligence on the part of, or for the supervision of, any
such agent, attorney, custodian or nominee appointed with due
care by it hereunder.
(d) The Trustee shall not be liable for any action it
takes or omits to take in good faith which it believes to be
authorized or within its rights or powers; provided, however,
that the Trustee's conduct does not constitute wilful
misconduct, negligence or bad faith.
(e) The Trustee may consult with counsel experienced in
such matters, and the advice or opinion of counsel with
respect to legal matters relating to this Indenture and the
Notes shall be full and complete authorization and protection
from liability in respect to any action taken, omitted or
suffered by it hereunder in good faith and in accordance with
the advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to
institute, conduct or defend any litigation under this
Indenture or in relation to this Indenture, at the request,
order or direction of any of the Holders of Notes or the
Controlling Party, pursuant to the provisions of this
Indenture, unless such Holders of Notes or the Controlling
Party shall have offered to the Trustee reasonable security
or indemnity against the costs, expenses and liabilities that
may be incurred therein or thereby; provided, however, that
the Trustee shall, upon the occurrence of an Event of Default
(that has not been cured), exercise the rights and powers
vested in it by this Indenture with reasonable care and
skill.
(g) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing to do so
by the Security Insurer (so long as no Insurer Default shall
have occurred and be continuing) or (if an Insurer Default
shall have occurred and be continuing) by the Holders of
Notes evidencing not less than 25% of the Outstanding Amount
thereof, provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to
it by the terms of this Indenture or the Sale and Servicing
Agreement, the Trustee may require reasonable indemnity
against such cost, expense or liability as a condition to so
proceeding; the reasonable expense of every such examination
shall be paid by the Person making such request, or, if paid
by the Trustee, shall be reimbursed by the Person making such
request upon demand.
SECTION 6.3. Individual Rights of Trustee. The Trustee
in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Issuer or
its Affiliates with the same rights it would have if it were
not Trustee. Any Paying Agent, Note Registrar, co-registrar
or copaying agent may do the same with like rights. However,
the Trustee is required to comply with Sections 6.11 and
6.12.
SECTION 6.4. Trustee's Disclaimer. The Trustee shall
not be responsible for and makes no representation as to the
validity or adequacy of this Indenture, the Trust Estate or
the Notes, it shall not be accountable for the Issuer's use
of the proceeds from the Notes, and it shall not be
responsible for any statement of the Issuer in the Indenture
or in any document issued in connection with the sale of the
Notes or in the Notes other than the Trustee's certificate of
authentication.
SECTION 6.5. Notice of Defaults. If a Default occurs
and is continuing and if it is known to a Responsible Officer
of the Trustee, the Trustee shall mail to each Noteholder and
the Security Insurer notice of the Default within 30 days
after the Default becomes known to a Responsible Officer.
Except in the case of a Default in payment of principal of or
interest on any Note (including payments pursuant to the
mandatory redemption provisions of such Note), the Trustee
may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that
withholding the notice is in the interests of Noteholders.
SECTION 6.6. Reports by Trustee to Holders. The
Trustee shall deliver to each Noteholder such information as
the Issuer may direct it to provide and which information
shall be provided to the Trustee by the Servicer to enable
each Noteholder to prepare its federal and state income tax
returns.
SECTION 6.7. Compensation and Indemnity.
(a) AFS, in a separate letter agreement (the "Letter
Agreement"), has covenanted and agreed to pay to the Trustee,
and the Trustee shall be entitled to, certain annual fees,
which shall not be limited by any law on compensation of a
trustee of an express trust. In the Letter Agreement, AFS
has also agreed to reimburse the Trustee for all reasonable
out-of-pocket expenses incurred or made by it, including
costs of collection, in addition to the compensation for its
services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the
Trustee's agents, counsel, accountants and experts. Pursuant
to the Letter Agreement, AFS has agreed to indemnify the
Trustee against any and all loss, liability or expense
(including attorneys' fees) incurred by it in connection with
the administration of this trust and the performance of its
duties hereunder.
(b) If notwithstanding the provisions of the Letter
Agreement, AFS fails to pay any fee due to the Trustee
pursuant to the terms of the Letter Agreement, the Trustee
shall be entitled to a distribution in respect of such amount
pursuant to Section 4.6(ii) of the Sale and Servicing
Agreement. If notwithstanding the provisions of the Letter
Agreement, AFS fails to make any payment or reimbursement due
to the Trustee for any expense or claim for indemnification
to which the Trustee is entitled pursuant to the terms of the
Letter Agreement or this Indenture, the Trustee shall be
entitled to a distribution in respect of such amount pursuant
to priority SIXTH of Section 3.03(b) of the Spread Account
Agreement (unless the Trustee is the Controlling Party).
AFS' payment obligations to the Trustee pursuant to the
Letter Agreement and this Section shall survive the discharge
of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 5.1(v) or
(vi) with respect to the Issuer, the expenses are intended to
constitute expenses of administration under Title 11 of the
United States Code or any other applicable Federal or state
bankruptcy, insolvency or similar law. Notwithstanding
anything else set forth in this Indenture or the Related
Documents, the Trustee agrees that the obligations of the
Issuer (but not AFS) to the Trustee hereunder and under the
Related Documents shall be recourse to the Trust Estate only
and specifically shall not be recourse to the assets of the
Issuer. In addition, the Trustee agrees that its recourse to
the Issuer, the Trust Estate, the Seller and amounts held
pursuant to the Spread Account Agreement shall be limited to
the right to receive the distributions referred to in the
first two sentences of this Section 6.7(b).
SECTION 6.8. Replacement of Trustee. The Trustee may
resign at any time by so notifying the Issuer, the
Noteholders (if there is an Insurer Default) and the Security
Insurer. The Issuer, may, with the consent of the
Controlling Party, and, at the request of the Controlling
Party shall, remove the Trustee, if:
(i) the Trustee fails to comply with Section
6.11;
(ii) a court having jurisdiction in the
premises in respect of the Trustee in an
involuntary case or proceeding under federal or
state banking or bankruptcy laws, as now or
hereafter constituted, or any other applicable
federal or state bankruptcy, insolvency or other
similar law, shall have entered a decree or order
granting relief or appointing a receiver,
liquidator, assignee, custodian, trustee,
conservator, sequestrator (or similar official) for
the Trustee or for any substantial part of the
Trustee's property, or ordering the winding-up or
liquidation of the Trustee's affairs, provided any
such decree or order shall have continued unstayed
and in effect for a period of 60 consecutive days;
(iii) the Trustee commences a voluntary case
under any federal or state banking or bankruptcy
laws, as now or hereafter constituted, or any other
applicable federal or state bankruptcy, insolvency
or other similar law, or consents to the appointment of
or taking possession by a receiver, liquidator,
assignee, custodian, trustee, conservator, sequestrator
(or other similar official) for the Trustee or for any
substantial part of the Trustee's property, or makes any
assignment for the benefit of creditors or fails
generally to pay its debts as such debts become due or
takes any corporate action in furtherance of any of the
foregoing;
(iv) the Trustee otherwise becomes incapable
of acting; or
(v) the rating assigned to the long-term
unsecured debt obligations of the Trustee (or the
holding company thereof) by the Rating Agencies
shall be lowered below the rating of "BBB", "Baa3"
or equivalent rating or be withdrawn by either of
the Rating Agencies.
If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason (the Trustee
in such event being referred to herein as the retiring
Trustee), the Issuer shall promptly provide written notice of
such event to the Rating Agency and shall appoint a successor
Trustee acceptable to the Controlling Party. If the Issuer
fails to appoint such a successor Trustee, the Controlling
Party may appoint a successor Trustee.
A successor Trustee shall deliver a written acceptance
of its appointment to the retiring Trustee and to the Issuer.
Thereupon the resignation or removal of the retiring Trustee
shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its
succession to Noteholders. The retiring Trustee shall
promptly transfer all property held by it as Trustee to the
successor Trustee.
If a successor Trustee does not take office within 60
days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Controlling Party, the Issuer or the
Holders of a majority in Outstanding Amount of the Notes may
petition any court of competent jurisdiction for the
appointment of a successor Trustee.
Any resignation or removal of the Trustee and
appointment of a successor Trustee pursuant to any of the
provisions of this Section shall not become effective until
acceptance of appointment by the successor Trustee pursuant
to this Section and payment of all fees and expenses owed to
the outgoing Trustee. Notwithstanding the replacement of the
Trustee pursuant to this Section, the retiring Trustee shall
be entitled to payment or reimbursement of such amounts as
such Person is entitled pursuant to Section 6.7.
SECTION 6.9. Successor Trustee by Merger. If the
Trustee
consolidates with, merges or converts into, or transfers all
or substantially all its corporate trust business or assets
to, another corporation or banking association, the
resulting, surviving or transferee corporation without any
further act shall be the successor Trustee, provided however,
that such successor to the Trustee shall be subject to
Section 6.8 of this Indenture and shall meet the minimum
rating required by Section 6.8(v) and the eligibility
requirements of Section 6.11 of this Indenture as of the date
of such succession. The Trustee shall provide the Rating
Agencies prompt notice of any such transaction.
In case at the time such successor or successors by
merger, conversion or consolidation to the Trustee shall
succeed to the trusts created by this Indenture any of the
Notes shall have been authenticated but not delivered, any
such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such
Notes so authenticated; and in case at that time any of the
Notes shall not have been authenticated, any successor to the
Trustee may authenticate such Notes either in the name of any
predecessor hereunder or in the name of the successor to the
Trustee; and in all such cases such certificates shall have
the full force which it is anywhere in the Notes or in this
Indenture provided that the certificate of the Trustee shall
have.
SECTION 6.10. Appointment of Co-Trustee or Separate
Trustee.
(a) Notwithstanding any other provisions of this
Indenture, at any time, for the purpose of meeting any legal
requirement of any jurisdiction in which any part of the
Trust may at the time be located, the Trustee, with the
consent of the Controlling Party and subject to the
disqualifying conditions of Section 6.8 of this Indenture,
shall have the power and may execute and deliver all
instruments to appoint one or more Persons to act as a co-
trustee or co-trustees, or separate trustee or separate
trustees, of all or any part of the Trust, and to vest in
such Person or Persons, in such capacity and for the benefit
of the Noteholders, such title to the Trust, or any part
hereof, and, subject to the other provisions of this Section,
such powers, duties, obligations, rights and trusts as the
Trustee may consider necessary or desirable, provided,
however, that any such Person shall meet the minimum rating
required by Section 6.8(v) of this Indenture as of the date
of such appointment. No co-trustee or separate trustee
hereunder shall be required to meet the terms of eligibility
as a successor Trustee under Section 6.11 and no notice to
Noteholders of the appointment of any co-trustee or separate
trustee shall be required under Section 6.8 hereof.
(b) Every separate trustee and co-trustee shall, to the
extent permitted by law, be appointed and act subject to the
following provisions and conditions:
(i) all rights, powers, duties and
obligations conferred or imposed upon the Trustee
shall be conferred or imposed upon and exercised or
performed by the Trustee and such separate trustee
or co-trustee jointly (it being understood that
such separate trustee or co-trustee is not
authorized to act separately without the Trustee
joining in such act), except to the extent that
under any law of any jurisdiction in which any
particular act or acts are to be performed the
Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such
rights, powers, duties and obligations (including
the holding of title to the Trust or any portion
thereof in any such jurisdiction) shall be
exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction
of the Trustee;
(ii) no trustee hereunder shall be personally
liable by reason of any act or omission of any
other trustee hereunder; and
(iii) the Trustee may at any time accept the
resignation of or remove any separate trustee or
co-trustee.
(c) Any notice, request or other writing given to the
Trustee shall be deemed to have been given to each of the
then separate trustees and co-trustees, as effectively as if
given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Indenture
and the conditions of this Article VI. Each separate trustee
and co-trustee, upon its acceptance of the trusts conferred,
shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Trustee or
separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every
provision of this Indenture relating to the conduct of,
affecting the liability of, or affording protection to, the
Trustee. Every such instrument shall be filed with the
Trustee.
(d) Any separate trustee or co-trustee may at any time
constitute the Trustee, its agent or attorney-in-fact with
full power and authority, to the extent not prohibited by
law, to do any lawful act under or in respect of this
Indenture on its behalf and in its name. If any separate
trustee or co-trustee shall die, become incapable of acting,
resign or be removed, all of its estates, properties, rights,
remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 6.11. Eligibility; Disqualification. The
Trustee shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual
report of condition and have a rating on its long-term
unsecured debt obligations at or above the level specified in
Section 6.8(v) of this Indenture. The Trustee shall provide
copies of such reports to the Security Insurer upon request.
SECTION 6.12. Appointment and Powers. Subject to the
terms and conditions hereof, each of the Issuer Secured
Parties hereby appoints LaSalle National Bank as the
Indenture Collateral Agent with respect to the Indenture
Collateral, and LaSalle National Bank hereby accepts such
appointment and agrees to act as Indenture Collateral Agent
with respect to the Indenture Collateral for the Issuer
Secured Parties, to maintain custody and possession of such
Indenture Collateral (except as otherwise provided hereunder)
and to perform the other duties of the Indenture Collateral
Agent in accordance with the provisions of this Indenture.
Each Issuer Secured Party hereby authorizes the Indenture
Collateral Agent to take such action on its behalf, and to
exercise such rights, remedies, powers and privileges
hereunder, as the Controlling Party may direct and as are
specifically authorized to be exercised by the Indenture
Collateral Agent by the terms hereof, together with such
actions, rights, remedies, powers and privileges as are
reasonably incidental thereto. The Indenture Collateral
Agent shall act upon and in compliance with the written
instructions of the Controlling Party delivered pursuant to
this Indenture promptly following receipt of such written
instructions; provided that the Indenture Collateral Agent
shall not act in accordance with any instructions for which
the Indenture Collateral Agent has not received reasonable
indemnity. Receipt of such instructions shall not be a
condition to the exercise by the Indenture Collateral Agent
of its express duties hereunder, except where this Indenture
provides that the Indenture Collateral Agent is permitted to
act only following and in accordance with such instructions.
SECTION 6.13. Performance of Duties. The Indenture
Collateral Agent shall have no duties or responsibilities
except those expressly set forth in this Indenture and the
other Related Documents to which the Indenture Collateral
Agent is a party or as directed by the Controlling Party in
accordance with this Indenture. The Indenture Collateral
Agent shall not be required to take any action hereunder
except at the written direction and with the indemnification
of the Controlling Party. The Indenture Collateral Agent
shall, and hereby agrees that it will, perform all of the
duties and obligations required of it under the Sale and
Servicing Agreement.
SECTION 6.14. Limitation on Liability. Neither the
Indenture Collateral Agent nor any of its directors, officers
or employees, shall be liable for any action taken or omitted
to be taken by it or them hereunder, or in connection
herewith, except that the Indenture Collateral Agent shall be
liable for its gross negligence, bad faith or willful
misconduct; nor shall the Indenture Collateral Agent be
responsible for the validity, effectiveness, value,
sufficiency or enforceability against the Issuer of this
Indenture or any of the Indenture Collateral (or any part
thereof). Notwithstanding any term or provision of this
Indenture, the Indenture Collateral Agent shall incur no
liability to Issuer or the Issuer Secured Parties for any
action taken or omitted by the Indenture Collateral Agent in
connection with the Indenture Collateral, except for the
gross negligence or willful misconduct on the part of the
Indenture Collateral Agent, and, further, shall incur no
liability to the Issuer Secured Parties except for gross
negligence or willful misconduct in carrying out its duties
to the Issuer Secured Parties. Subject to Section 6.15, the
Indenture Collateral Agent shall be protected and shall incur
no liability to any such party in relying upon the accuracy,
acting in reliance upon the contents, and assuming the
genuineness of any notice, demand, certificate, signature,
instrument or other document reasonably believed by the
Indenture Collateral Agent to be genuine and to have been
duly executed by the appropriate signatory, and (absent
actual knowledge to the contrary) the Indenture Collateral
Agent shall not be required to make any independent
investigation with respect thereto. The Indenture Collateral
Agent shall at all times be free independently to establish
to its reasonable satisfaction, but shall have no duty to
independently verify, the existence or nonexistence of facts
that are a condition to the exercise or enforcement of any
right or remedy hereunder or under any of the Related
Documents. The Indenture Collateral Agent may consult with
counsel, and shall not be liable for any action taken or
omitted to be taken by it hereunder in good faith and in
accordance with the written advice of such counsel. The
Indenture Collateral Agent shall not be under any obligation
to exercise any of the remedial rights or powers vested in it
by this Indenture or to follow any direction from the
Controlling Party unless it shall have received reasonable
security or indemnity satisfactory to the Indenture
Collateral Agent against the costs, expenses and liabilities
which might be incurred by it.
SECTION 6.15. Reliance upon Documents. In the absence
of bad faith or negligence on its part, the Indenture
Collateral Agent shall be entitled to rely on any
communication, instrument, paper or other document reasonably
believed by it to be genuine and correct and to have been
signed or sent by the proper Person or Persons and shall have
no liability in acting, or omitting to act, where such action
or omission to act is in reasonable reliance upon any
statement or opinion contained in any such document or
instrument.
SECTION 6.16. Successor Indenture Collateral Agent.
(a) Merger. Any Person into which the Indenture
Collateral Agent may be converted or merged, or with which it
may be consolidated, or to which it may sell or transfer its
trust business and assets as a whole or substantially as a
whole, or any Person resulting from any such conversion,
merger, consolidation, sale or transfer to which the
Indenture Collateral Agent is a party, shall (provided it is
otherwise qualified to serve as the Indenture Collateral
Agent hereunder) be and become a successor Indenture
Collateral Agent hereunder and be vested with all of the
title to and interest in the Indenture Collateral and all of
the trusts, powers, discretions, immunities, privileges and
other matters as was its predecessor without the execution or
filing of any instrument or any further act, deed or
conveyance on the part of any of the parties hereto, anything
herein to the contrary notwithstanding, except to the extent,
if any, that any such action is necessary to perfect, or
continue the perfection of, the security interest of the
Issuer Secured Parties in the Indenture Collateral, provided
however, that the Trustee and the Indenture Collateral Agent
shall always be the same Person.
(b) Resignation. The Indenture Collateral Agent and
any successor Indenture Collateral Agent may resign at any
time by so notifying the Issuer and the Security Insurer.
(c) Removal. The Indenture Collateral Agent may be
removed by the Controlling Party at any time, with or without
cause, by an instrument or concurrent instruments in writing
delivered to the Indenture Collateral Agent, the other Issuer
Secured Party and the Issuer. A temporary successor may be
removed at any time to allow a successor Indenture Collateral
Agent to be appointed pursuant to subsection (d) below. Any
removal pursuant to the provisions of this subsection (c)
shall take effect only upon the date which is the latest of
(i) the effective date of the appointment of a successor
Indenture Collateral Agent and the acceptance in writing by
such successor Indenture Collateral Agent of such appointment
and of its obligation to perform its duties hereunder in
accordance with the provisions hereof, and (ii) receipt by
the Controlling Party of an Opinion of Counsel to the effect
described in Section 3.6.
(d) Acceptance by Successor. The Controlling Party
shall have the sole right to appoint each successor Indenture
Collateral Agent. Every temporary or permanent successor
Indenture Collateral Agent appointed hereunder shall execute,
acknowledge and deliver to its predecessor and to the
Trustee, each Issuer Secured Party and the Issuer an
instrument in writing accepting such appointment hereunder
and the relevant predecessor shall execute, acknowledge and
deliver such other documents and instruments as will
effectuate the delivery of all Indenture Collateral to the
successor Indenture Collateral Agent, whereupon such
successor, without any further act, deed or conveyance, shall
become fully vested with all the estates, properties, rights,
powers, duties and obligations of its predecessor. Such
predecessor shall, nevertheless, on the written request of
either Issuer Secured Party or the Issuer, execute and
deliver an instrument transferring to such successor all the
estates, properties, rights and powers of such predecessor
hereunder. In the event that any instrument in writing from
the Issuer or an Issuer Secured Party is reasonably required
by a successor Indenture Collateral Agent to more fully and
certainly vest in such successor the estates, properties,
rights, powers, duties and obligations vested or intended to
be vested hereunder in the Indenture Collateral Agent, any
and all such written instruments shall, at the request of the
temporary or permanent successor Indenture Collateral Agent,
be forthwith executed, acknowledged and delivered by the
Trustee or the Issuer, as the case may be. The designation of
any successor Indenture Collateral Agent and the instrument
or instruments removing any Indenture Collateral Agent and
appointing a successor hereunder, together with all other
instruments provided for herein, shall be maintained with the
records relating to the Indenture Collateral and, to the
extent required by applicable law, filed or recorded by the
successor Indenture Collateral Agent in each place where such
filing or recording is necessary to effect the transfer of
the Indenture Collateral to the successor Indenture
Collateral Agent or to protect or continue the perfection of
the security interests granted hereunder.
SECTION 6.17. Compensation and Indemnity.
(a) AFS, in a separate letter agreement or in the
Letter Agreement (the "ICA Letter Agreement") has covenanted
and agreed to pay to the Indenture Collateral Agent, and the
Indenture Collateral Agent shall be entitled to certain
annual fees, which shall not be limited by any law on
compensation of an Indenture Collateral Agent of an express
trust. In the ICA Letter Agreement, AFS has also agreed to
reimburse the Indenture Collateral Agent for all reasonable
out-of-pocket expenses incurred or made by it, including
costs of collection, in addition to the compensation for its
services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the
Indenture Collateral Agent's agents, counsel, accountants and
experts. Pursuant to the ICA Letter Agreement, AFS has
agreed to indemnify the Indenture Collateral Agent against
any and all loss, liability or expense (including attorneys'
fees) incurred by it in connection with the administration of
this trust and the performance of its duties hereunder.
(b) If notwithstanding the provisions of the ICA Letter
Agreement, AFS fails to pay any fee due to the Indenture
Collateral Agent pursuant to the terms of the ICA Letter
Agreement, the Indenture Collateral Agent shall be entitled
to a distribution in respect of such amount pursuant to
Section 4.6(ii) of the Sale and Servicing Agreement. If
notwithstanding the provisions of the ICA Letter Agreement,
AFS fails to make any payment or reimbursement due to the
Indenture Collateral Agent for any expense or claim for
indemnification to which the Indenture Collateral Agent is
entitled pursuant to the terms of the ICA Letter Agreement,
the Indenture Collateral Agent shall be entitled to a
distribution in respect of such amount pursuant either to
priority SIXTH or priority SEVENTH of Section 3.03(b) of the
Spread Account Agreement in accordance with the terms thereof
(unless the Trustee is the Controlling Party). AFS's payment
obligations to the Indenture Collateral Agent pursuant to the
ICA Letter Agreement and this Section shall survive the
discharge of this Indenture. When the Indenture Collateral
Agent incurs expenses after the occurrence of a Default
specified in Section 5.1(v) or (vi) with respect to the
Issuer, the expenses are intended to constitute expenses of
administration under Title 11 of the United States Code or
any other applicable Federal or state bankruptcy, insolvency
or similar law. Notwithstanding anything else set forth in
this Indenture or the Related Documents, the Indenture
Collateral Agent agrees that the obligations of the Issuer to
the Indenture Collateral Agent hereunder and under the
Related Documents shall be limited recourse to amounts
payable to the Indenture Collateral Agent pursuant to Section
4.6(ii) of the Sale and Service Agreement. In addition, the
Indenture Collateral Agent agrees that its recourse to the
Seller and amounts held pursuant to the Spread Account
Agreement shall be limited to the right to receive the
distributions referred to in the second sentence of this
Section 6.17(b).
SECTION 6.18. Representations and Warranties of the
Indenture Collateral Agent. The Indenture Collateral Agent
represents and warrants to the Issuer and to each Issuer
Secured Party as follows:
(a) Due Organization. The Indenture Collateral Agent
is a national banking association, duly organized, validly
existing and in good standing under the laws of the United
States and is duly authorized and licensed under applicable
law to conduct its business as presently conducted.
(b) Corporate Power. The Indenture Collateral Agent
has all requisite right, power and authority to execute and
deliver this Indenture and to perform all of its duties as
Indenture Collateral Agent hereunder.
(c) Due Authorization. The execution and delivery by
the Indenture Collateral Agent of this Indenture and the
other Transaction Documents to which it is a party, and the
performance by the Indenture Collateral Agent of its duties
hereunder and thereunder, have been duly authorized by all
necessary corporate proceedings and no further approvals or
filings, including any governmental approvals, are required
for the valid execution and delivery by the Indenture
Collateral Agent, or the performance by the Indenture
Collateral Agent, of this Indenture and such other Related
Documents.
(d) Valid and Binding Indenture. The Indenture
Collateral Agent has duly executed and delivered this
Indenture and each other Related Document to which it is a
party, and each of this Indenture and each such other Related
Document constitutes the legal, valid and binding obligation
of the Indenture Collateral Agent, enforceable against the
Indenture Collateral Agent in accordance with its terms,
except as (i) such enforceability may be limited by
bankruptcy, insolvency, reorganization and similar laws
relating to or affecting the enforcement of creditors' rights
generally and (ii) the availability of equitable remedies may
be limited by equitable principles of general applicability.
SECTION 6.19. Waiver of Setoffs. The Indenture
Collateral Agent hereby expressly waives any and all rights
of setoff that the Indenture Collateral Agent may otherwise
at any time have under applicable law with respect to any
Trust Account and agrees that amounts in the Trust Accounts
shall at all times be held and applied solely in accordance
with the provisions hereof.
SECTION 6.20. Control by the Controlling Party. The
Indenture Collateral Agent shall comply with notices and
instructions given by the Issuer only if accompanied by the
written consent of the Controlling Party, except that if any
Event of Default shall have occurred and be continuing, the
Indenture Collateral Agent shall act upon and comply with,
notices and instructions given by the Controlling Party alone
in the place and stead of the Issuer.
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.1. Issuer to Furnish Trustee Names and
Addresses of Noteholders. The Issuer will furnish or cause
to be furnished to the Trustee (a) not more than five days
after the earlier of (i) each Record Date and (ii) three
months after the last Record Date, a list, in such form as
the Trustee may reasonably require, of the names and
addresses of the Holders of Notes as of such Record Date, (b)
at such other times as the Trustee may request in writing
within 30 days after receipt by the Issuer of any such
request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished;
provided, however, that so long as the Trustee is the Note
Registrar, no such list shall be required to be furnished.
The Trustee or, if the Trustee is not the Note Registrar, the
Issuer shall furnish to the Security Insurer in writing on an
annual basis on each March 31 and at such other times as the
Security Insurer may request a copy of the list.
SECTION 7.2. Preservation of Information,
Communications to Noteholders.
(a) The Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of the
Holders of Notes contained in the most recent list furnished
to the Trustee as provided in Section 7.1 and the names and
addresses of Holders of Notes received by the Trustee in its
capacity as Note Registrar. The Trustee may destroy any list
furnished to it as provided in such Section 7.1 upon receipt
of a new list so furnished. The Trustee shall make such list
available to the Noteholders and the Security Insurer upon
request.
(b) Noteholders may communicate with other Noteholders
with respect to their rights under this Indenture or under
the Notes.
SECTION 7.3. Reports by Issuer.
(a) The Issuer shall supply to the Trustee for mailing
by the Trustee to all Noteholders, any information pertaining
to the Issuer as may be reasonably necessary, based upon an
Opinion of Counsel, to afford Noteholders the ability to sell
or transfer Notes pursuant to Rule 144A of the Securities
Act.
(b) Unless the Issuer otherwise determines, the fiscal
year of the Issuer shall end on June 30 of each year.
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.1. Collection of Money. Except as otherwise
expressly provided herein, the Trustee may demand payment or
delivery of, and shall receive and collect, directly and
without intervention or assistance of any fiscal agent or
other intermediary, all money and other property payable to
or receivable by the Trustee pursuant to this Indenture. The
Trustee shall apply all such money received by it as provided
in this Indenture. Except as otherwise expressly provided in
this Indenture, if any default occurs in the making of any
payment or performance under any agreement or instrument that
is part of this Indenture or the Notes, the Trustee may take
such action as may be appropriate to enforce such payment or
performance, including the institution and prosecution of
appropriate Proceedings. Any such action shall be without
prejudice to any right to claim a Default or Event of Default
under this Indenture and any right to proceed thereafter as
provided in Article V.
SECTION 8.2. Trust Accounts.
(a) On or prior to the Closing Date, the Indenture
Collateral Agent shall establish and maintain, in the name of
the Indenture Collateral Agent, for the benefit of the
Noteholders, the Trust Accounts as provided in Section 4.1 of
the Sale and Servicing Agreement.
(b) On each Payment Date and Redemption Date, the
Trustee shall distribute amounts on deposit in the Note
Distribution Account to Noteholders in respect of the Notes
to the extent of amounts due and unpaid on the Notes for
principal and interest, first to pay all accrued and unpaid
interest, and then to pay principal on the Notes until the
outstanding amount of the Notes is reduced to zero.
SECTION 8.3. General Provisions Regarding Accounts.
(a) So long as no Default or Event of Default shall
have occurred and be continuing all or a portion of the funds
in the Trust Accounts shall be invested and reinvested by the
Indenture Collateral Agent on behalf of the Issuer in
Eligible Investments in accordance with the provisions of
Section 4.1(c) of the Sale and Servicing Agreement.
(b) Subject to Section 6.1(c), the Indenture Collateral
Agent shall not in any way be held liable by reason of any
insufficiency in any of the Trust Accounts resulting from any
loss on any Eligible Investment included therein except for
losses attributable to the Indenture Collateral Agent's
failure to make payments on such Eligible Investments issued
by the Indenture Collateral Agent, in its commercial capacity
as principal obligor and not as Indenture Collateral Agent,
in accordance with their terms.
ARTICLE IX
Supplemental Indentures
SECTION 9.1. Supplemental Indentures Without Consent of
Noteholders.
(a) Without the consent of the Holders of any Notes but
with the consent of the Security Insurer (unless an Insurer
Default shall have occurred and be continuing) and with prior
notice to the Rating Agencies, the Issuer and the Trustee,
when authorized by an Issuer Order, at any time and from time
to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the
following purposes:
(i) to correct or amplify the description of any
property at any time subject to the lien of this
Indenture, or better to assure, convey and confirm unto
the Indenture Collateral Agent any property subject or
required to be subjected to the lien created by this
Indenture, or to subject to the lien created by this
Indenture additional property;
(ii) to evidence the succession, in compliance with
the applicable provisions hereof, of another Person to
the Issuer, and the assumption by any such successor of
the covenants of the Issuer herein and in the Notes
contained;
(iii) to add to the covenants of the Issuer, for
the benefit of the Holders of the Notes, or to surrender
any right or power herein conferred upon the Issuer,
(iv) to convey, transfer, assign, mortgage or
pledge any property to or with the Indenture Collateral
Agent;
(v) to cure any ambiguity, to correct or
supplement any provision herein or in any supplemental
indenture which may be inconsistent with any other
provision herein or in any supplemental indenture or to
make any other provisions with respect to matters or
questions arising under this Indenture or in any
supplemental indenture; provided that such action shall
not adversely affect the interests of the Holders of the
Notes; or
(vi) to evidence and provide for the acceptance of
the appointment hereunder by a successor trustee with
respect to the Notes and to add to or change any of the
provisions of this Indenture as shall be necessary to
facilitate the administration of the trusts hereunder by
more than one trustee, pursuant to the requirements of
Article VI.
The Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any
further appropriate agreements and stipulations that may be
therein contained.
(b) The Issuer and the Trustee, when authorized by an
Issuer Order, may, also without the consent of any of the
Holders of the Notes but with the consent of the Security
Insurer (unless an Insurer Default shall have occurred and be
continuing) and with prior notice to the Rating Agencies,
enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to, or changing in any
manner or eliminating any of the provisions of, this
Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; provided, however,
that such action shall not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the
interests of any Noteholder.
SECTION 9.2. Supplemental Indentures With Consent of
Noteholders. The Issuer and the Trustee, when authorized by
an Issuer Order, also may, with prior notice to the Rating
Agencies, with the consent of the Controlling Party enter
into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any
manner or eliminating any of the provisions of, this
Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture, provided, however,
that, subject to the express rights of the Security Insurer
under the Related Documents, including its rights to agree to
certain modifications of the Receivables pursuant to Section
3.2 of the Sale and Servicing Agreement and its rights
referred to in Section 5.2(c), no such supplemental indenture
shall, without the consent of the Holder of each Outstanding
Note affected thereby:
(i) change the date of payment of any installment
of principal of or interest on any Note, or reduce the
principal amount thereof, the interest rate thereon or
the Redemption Price with respect thereto, change the
provision of this Indenture relating to the application
of collections on, or the proceeds of the sale of, the
Trust Estate to payment of principal of or interest on
the Notes, or change any place of payment where, or the
coin or currency in which, any Note or the interest
thereon is payable, or impair the right to institute
suit for the enforcement of the provisions of this
Indenture requiring the application of funds available
therefor, as provided in Article V, to the payment of
any such amount due on the Notes on or after the
respective due dates thereof (or, in the case of
redemption, on or after the Redemption Date);
(ii) reduce the percentage of the Outstanding
Amount of the Notes, the consent of the Holders of which
is required for any such supplemental indenture, or the
consent of the Holders of which is required for any
waiver of compliance with certain provisions of this
Indenture or certain defaults hereunder and their
consequences provided for in this Indenture;
(iii) modify or alter the provisions of the second
proviso to the definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding
Amount of the Notes required to direct the Trustee to
direct the Issuer to sell or liquidate the Trust Estate
pursuant to Section 5.4;
(v) modify any provision of this Section except to
increase any percentage specified herein or to provide
that certain additional provisions of this Indenture or
the Related Documents cannot be modified or waived
without the consent of the Holder of each Outstanding
Note affected thereby;
(vi) modify any of the provisions of this Indenture
in such manner as to affect the calculation of the
amount of any payment of interest or principal due on
any Note on any Payment Date (including the calculation
of any of the individual components of such calculation)
or to affect the rights of the Holders of Notes to the
benefit of any provisions for the mandatory redemption
of the Notes contained herein; or
(vii) permit the creation of any lien ranking prior
to or on a parity with the lien created by this
Indenture with respect to any part of the Trust Estate
or, except as otherwise permitted or contemplated
herein, terminate the lien created by this Indenture on
any property at any time subject hereto or deprive the
Holder of any Note of the security provided by the lien
created by this Indenture.
The Trustee may in its discretion determine whether or
not any Notes would be affected by any supplemental indenture
and any such determination shall be conclusive upon the
Holders of all Notes, whether theretofore or thereafter
authenticated and delivered hereunder. The Trustee shall not
be liable for any such determination made in good faith.
Promptly after the execution by the Issuer and the
Trustee of any supplemental indenture pursuant to this
Section, the Trustee shall mail to the Holders of the Notes
to which such amendment or supplemental indenture relates a
notice setting forth in general terms the substance of such
supplemental indenture, and including a copy of such
supplemental indenture. Any failure of the Trustee to mail
such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such
supplemental indenture.
SECTION 9.3. Execution of Supplemental Indentures. In
executing, or permitting the additional trusts created by,
any supplemental indenture permitted by this Article IX or
the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and
subject to Sections 6.1 and 6.2 shall be fully protected in
relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or
permitted by this Indenture. The Trustee may, but shall not
be obligated to, enter into any such supplemental indenture
that affects the Trustee's own rights, duties, liabilities or
immunities under this Indenture or otherwise.
SECTION 9.4. Effect of Supplemental Indenture. Upon
the execution of any supplemental indenture pursuant to the
provisions hereof, this Indenture shall be and be deemed to
be modified and amended in accordance therewith with respect
to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and
immunities under this Indenture of the Trustee, the Issuer
and the Holders of the Notes shall thereafter be determined,
exercised and enforced hereunder subject in all respects to
such modifications and amendments, and all the terms and
conditions of any such supplemental indenture shall be and be
deemed to be part of the terms and conditions of this
Indenture for any and all purposes.
SECTION 9.5. Reference in Notes to Supplemental
Indentures. Notes authenticated and delivered after the
execution of any supplemental indenture pursuant to this
Article IX may, and if required by the Trustee shall, bear a
notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Issuer
or the Trustee shall so determine, new notes so modified as
to conform, in the opinion of the Trustee and the Issuer, to
any such supplemental indenture may be prepared and executed
by the Issuer and authenticated and delivered by the Trustee
in exchange for Outstanding Notes.
ARTICLE X
Redemption of Notes
SECTION 10.1. Redemption. In the event that the
Servicer pursuant to Section 9.1 of the Sale and Servicing
Agreement purchases the Receivables, the Notes are subject to
redemption in whole, but not in part, on the Payment Date on
which such repurchase occurs, for a purchase price equal to
the Redemption Price. The Seller, the Servicer or the Issuer
shall furnish the Security Insurer and the Rating Agencies
notice of such redemption. If the Notes are to be redeemed
pursuant to this Section 10.1, the Issuer shall furnish
notice of such election to the Trustee and to each Noteholder
not later than 25 days prior to the Redemption Date and the
Issuer shall deposit with the Trustee in the Note
Distribution Account not less than seven days prior to the
applicable Redemption Date, the Redemption Price of the Notes
to be redeemed whereupon all such Notes shall be due and
payable on the Redemption Date upon the furnishing of a
notice complying with Section 10.2 to each Holder of the
Notes.
SECTION 10.2. Form of Redemption Notice. Notice of
redemption under Section 10.1 shall be given by the Trustee
by first-class mail, postage prepaid, mailed not less than
five days prior to the applicable Redemption Date to each
Holder of Notes (or, upon request by a Noteholder which
purchased the Notes on the Closing Date, by facsimile), as of
the close of business on the Record Date preceding the
applicable Redemption Date, at such Holder's address
appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
(iii) the place where such Notes are to be
surrendered for payment of the Redemption Price (which
shall be the office or agency of the Issuer to be
maintained as provided in Section 3.2).
Notice of redemption of the Notes shall be given by the
Trustee in the name and at the expense of the Issuer.
Failure to give notice of redemption, or any defect therein,
to any Holder of any Note shall not impair or affect the
validity of the redemption of any other Note.
SECTION 10.3. Notes Payable on Redemption Date. The
Notes or portions thereof to be redeemed shall, following
notice of redemption (if any) as required by Section 10.2, on
the Redemption Date become due and payable at the Redemption
Price and (unless the Issuer shall default in the payment of
the Redemption Price) no interest shall accrue on the
Redemption Price for any period after the date to which
accrued interest is calculated for purposes of calculating
the Redemption Price.
ARTICLE XI
Miscellaneous
SECTION 11.1. Compliance Certificates and Opinions,
etc.
(a) Upon an application or request by the Issuer to the
Trustee or the Indenture Collateral Agent to take any action
under any provision of this Indenture, the Issuer shall
furnish to the Trustee or the Indenture Collateral Agent, as
the case may be, and to the Security Insurer if the
application or request is made to the Indenture Collateral
Agent (i) an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with, and
(ii) an Opinion of Counsel stating that in the opinion of
such counsel all such conditions precedent, if any, have been
complied with, except that, in the case of any such
application or request as to which the furnishing of such
documents is specifically required by any provision of this
Indenture, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture
shall include:
(i) a statement that each signatory of such
certificate or opinion has read or has caused to be read
such covenant or condition and the definitions herein
relating thereto;
(ii) a brief statement as to the nature and scope
of the examination or investigation upon which the
statements or opinions contained in such certificate or
opinion are based;
(iii) a statement that, in the opinion of each such
signatory, such signatory has made such examination or
investigation as is necessary to enable such signatory
to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of
each such signatory, such condition or covenant has been
complied with.
(b) (i) Prior to the deposit of any Indenture
Collateral or other property or securities with the Indenture
Collateral Agent that is to be made the basis for the release
of any property subject to the lien created by this
Indenture, the Issuer shall, in addition to any obligation
imposed in Section 11.1(a) or elsewhere in this Indenture,
furnish to the Indenture Collateral Agent and the Security
Insurer (so long as no Insurer Default shall have occurred
and be continuing) an Officers' Certificate certifying or
stating the opinion of each person signing such certificate
as to the fair value (within 90 days of such deposit) to the
Issuer of the Indenture Collateral or other property or
securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Collateral Agent and the Security Insurer an
Officers' Certificate certifying or stating the opinion of
any signer thereof as to the matters described in clause (i)
above, the Issuer shall also deliver to the Indenture
Collateral Agent and the Security Insurer an Independent
Certificate as to the same matters, if the fair value to the
Issuer of the property to be so deposited and of all other
such property made the basis of any such withdrawal or
release since the commencement of the then current fiscal
year of the Issuer, as set forth in the certificates
delivered pursuant to clause (i) above and this clause (ii),
is 10% or more of the Outstanding Amount of the Notes, but
such a certificate need not be furnished with respect to any
property so deposited, if the fair value thereof to the
Issuer as set forth in the related Officers' Certificate is
less than $25,000 or less than one percent of the Outstanding
Amount of the Notes.
(iii) Other than with respect to any release
described in clause (A) or (B) of Section 11.1(b)(v),
whenever any property or securities are to be released from
the lien created by this Indenture, the Issuer shall also
furnish to the Indenture Collateral Agent and the Security
Insurer (so long as no Insurer Default shall have occurred
and be continuing) an Officers' Certificate certifying or
stating the opinion of each person signing such certificate
as to the fair value (within 90 days of such release) of the
property or securities proposed to be released and stating
that in the opinion of such person the proposed release will
not impair the security created by this Indenture in
contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the
Trustee and the Security Insurer an Officers' Certificate
certifying or stating the opinion of any signer thereof as to
the matters described in clause (iii) above, the Issuer shall
also furnish to the Indenture Collateral Agent and the
Security Insurer an Independent Certificate as to the same
matters if the fair value of the property or securities and
of all other property or securities (other than property
described in clauses (A) or (B) of Section 11.1(b)(v))
released from the lien created by this Indenture since the
commencement of the then current fiscal year, as set forth in
the certificates required by clause (iii) above and this
clause (iv), equals 10% or more of the Outstanding Amount of
the Notes, but such certificate need not be furnished in the
case of any release of property or securities if the fair
value thereof as set forth in the related Officers'
Certificate is less than $25,000 or less than one percent of
the then Outstanding Amount of the Notes.
(v) Notwithstanding any other provision of this
Section, the Issuer may without compliance with the other
provisions of this Section (A) collect, liquidate, sell or
otherwise dispose of Receivables as and to the extent
permitted or required by the Related Documents (including as
provided in Section 3.1 of the Sale and Servicing Agreement)
and (B) make cash payments out of the Trust Accounts as and
to the extent permitted or required by the Related Documents.
SECTION 11.2. Form of Documents Delivered to Trustee.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified
Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one
document, but one such Person may certify or give an opinion
with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several
documents.
Any certificate or opinion of an Authorized Officer of
the Issuer may be based, insofar as it relates to legal
matters, upon a certificate or opinion of, or representations
by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion
or representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such
certificate of an Authorized Officer or Opinion of Counsel
may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an
officer or officers of the Servicer, the Seller or the
Issuer, stating that the information with respect to such
factual matters is in the possession of the Servicer, the
Seller or the Issuer, unless such counsel knows, or in the
exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters
are erroneous.
Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates,
statements, opinions or other instruments under this
Indenture, they may, but need not, be consolidated and form
one instrument.
Whenever in this Indenture, in connection with any
application or certificate or report to the Trustee, it is
provided that the Issuer shall deliver any document as a
condition of the granting of such application, or as evidence
of the Issuer's compliance with any term hereof, it is
intended that the truth and accuracy, at the time of the
granting of such application or at the effective date of such
certificate or report (as the case may be), of the facts and
opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such
application granted or to the sufficiency of such certificate
or report. The foregoing shall not, however, be construed to
affect the Trustees right to rely upon the truth and accuracy
of any statement or opinion contained in any such document as
provided in Article VI.
SECTION 11.3. Acts of Noteholders.
(a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this
Indenture to be given or taken by Noteholders may be embodied
in and evidenced by one or more instruments of substantially
similar tenor signed by such Noteholders in person or by
agents duly appointed in writing; and except as herein
otherwise expressly provided such action shall become
effective when such instrument or instruments are delivered
to the Trustee, and, where it is hereby expressly required,
to the Issuer. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Noteholders signing
such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and
(subject to Section 6.1) conclusive in favor of the Trustee
and the Issuer, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any person of
any such instrument or writing may be proved in any manner
that the Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note
Register.
(d) Any request, demand, authorization, direction,
notice, consent, waiver or other action by the Holder of any
Notes shall bind the Holder of every Note issued-upon the
registration thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to
be done by the Trustee or the Issuer in reliance thereon,
whether or not notation of such action is made upon such
Note.
SECTION 11.4. Notices, etc., to Trustee, Issuer and
Rating Agencies. Any request, demand, authorization,
direction, notice, consent, waiver or Act of Noteholders or
other documents provided or permitted by this Indenture to be
made upon, given or furnished to or filed with:
(a) the Trustee by any Noteholder or by the Issuer
shall be sufficient for every purpose hereunder if made,
given, furnished or filed in writing to or with the Trustee
at its Corporate Trust Office,
(b) the Issuer by the Trustee or by any Noteholder
shall be sufficient for every purpose hereunder if in writing
and mailed, first class, postage prepaid, to the Issuer
addressed to: AmeriCredit Receivables Finance Corp., 200
Bailey Avenue, Fort Worth, Texas 76107-1220, Attention:
Chief Financial Officer, or at any other address previously
furnished in writing to the Trustee by Issuer. The Issuer
shall promptly transmit any notice received by it from the
Noteholders to the Trustee, or
(c) the Security Insurer by the Issuer or the Trustee
shall be sufficient for any purpose hereunder if in writing
and mailed by registered mail or personally delivered or
telexed or telecopied to the recipient as follows:
To the Security Insurer: Financial Security Assurance Inc.
350 Park Avenue
New York, NY 10022
Attention: Surveillance Department
Telex No.: (212) 688-3101
Confirmation: (212) 826-0100
Telecopy Nos.: (212) 339-3518
(212) 339-3529
(In each case in which notice or other communication to the
Security Insurer refers to an Event of Default, a claim on
the Policy or with respect to which failure on the part of
the Security Insurer to respond shall be deemed to constitute
consent or acceptance, then a copy of such notice or other
communication should also be sent to the attention of the
General Counsel and the Head-Financial Guaranty Group "URGENT
MATERIAL ENCLOSED.")
Notices required to be given to the Rating Agencies
by the Issuer or the Trustee shall be in writing,
personally delivered or mailed by certified mail, return
receipt requested to (i) in the case of Moody's, at the
following address: Moody's Investors Service, Inc., ABS
Monitoring Department, 99 Church Street, New York, New
York 10007 and (ii) in the case of Standard & Poor's, at
the following address: Standard & Poor's Corporation, 26
Broadway (20th Floor), New York, New York 10004,
Attention of Asset Backed Surveillance Department; or as
to each of the foregoing, at such other address as shall
be designated by written notice to the other parties.
SECTION 11.5. Notices to Noteholders; Waiver. Where
this Indenture provides for notice to Noteholders of any
event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and
mailed, first-class, postage prepaid to each Noteholder
affected by such event, at his address as it appears on the
Note Register, not later than the latest date, and not
earlier than the earliest date, prescribed for the giving of
such notice. In any case where notice to Noteholders is
given by mail, neither the failure to mail such notice nor
any defect in any notice so mailed to any particular
Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed
in the manner herein provided shall conclusively be presumed
to have been duly given.
Where this Indenture provides for notice in any manner,
such notice may be waived in writing by any Person entitled
to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers
of notice by Noteholders shall be filed with the Trustee but
such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail
service as a result of a strike, work stoppage or similar
activity, it shall be impractical to mail notice of any event
to Noteholders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner
of giving such notice as shall be satisfactory to the Trustee
shall be deemed to be a sufficient giving of such notice.
When this Indenture provides for notice to the Rating
Agencies, failure to give such notice shall not affect any
other rights or obligations created hereunder, and shall not
under any circumstance constitute a Default or Event of
Default.
SECTION 11.6. Alternate Payment and Notice Provisions.
Notwithstanding any provision of this Indenture or any of the
Notes to the contrary, the Issuer may enter into any
agreement with any Holder of a Note providing for a method of
payment, or notice by the Trustee or any Paying Agent to such
Holder, that is different from the methods provided for in
this Indenture for such payments or notices. The Issuer will
furnish to the Trustee a copy of each such agreement and the
Trustee will cause payments to be made and notices to be
given in accordance with such agreements.
SECTION 11.7. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the
construction hereof.
SECTION 11.8. Successors and Assigns. All covenants
and agreements in this Indenture and the Notes by the Issuer
shall bind its successors and assigns, whether so expressed
or not. All agreements of the Trustee in this Indenture
shall bind its successors.
SECTION 11.9. Severability. In case any provision in
this Indenture or in the Notes shall be invalid, illegal or
unenforceable, the validity, legality, and enforceability of
the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 11.10. Benefits of Indenture. The Security
Insurer and its successors and assigns shall be a third-party
beneficiary to the provisions of this Indenture, and shall be
entitled to rely upon and directly to enforce such provisions
of this Indenture so long as no Insurer Default shall have
occurred and be continuing. Nothing in this Indenture or in
the Notes, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder,
and the Noteholders, and any other party secured hereunder,
and any other Person with an ownership interest in any part
of the Trust Estate, any benefit or any legal or equitable
right, remedy or claim under this Indenture. The Security
Insurer may disclaim any of its rights and powers under this
Indenture (in which case the Trustee may exercise such right
or power hereunder), but not its duties and obligations under
the Policy, upon delivery of a written notice to the Trustee.
SECTION 11.11. Legal Holidays. In any case where the
date on which any payment is due shall not be a Business Day,
then (notwithstanding any other provision of the Notes or
this Indenture) payment need not be made on such date, but
may be made on the next succeeding Business Day with the same
force and effect as if made on the date on which nominally
due, and no interest shall accrue for the period from and
after any such nominal date.
SECTION 11.12. GOVERNING LAW. THIS INDENTURE SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.13. Counterparts. This Indenture may be
executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same
instrument.
SECTION 11.14. Recording of Indenture. If this
Indenture is subject to recording in any appropriate public
recording offices, such recording is to be effected by the
Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Trustee or any other
counsel reasonably acceptable to the Trustee, and the
Controlling Party) to the effect that such recording is
necessary either for the protection of the Noteholders or any
other Person secured hereunder or for the enforcement of any
right or remedy granted to the Trustee or the Indenture
Collateral Agent under this Indenture or the Collateral Agent
under the Spread Account Agreement.
SECTION 11.15. Trust Obligation. No recourse may be
taken, directly or indirectly, with respect to the
obligations of the Issuer or the Trustee on the Notes or
under this Indenture or any certificate or other writing
delivered in connection herewith or therewith, against (i)
the Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director, employee or
agent of the Trustee in its individual capacity, any holder
of a beneficial interest in the Issuer or the Trustee or of
any successor or assign of the Trustee in its individual
capacity, except as any such Person may have expressly agreed
(it being understood that the Trustee has no such obligations
in its individual capacity) and except that any such partner,
owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for
stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
SECTION 11.16. No Petition. The Trustee and the
Indenture Collateral Agent, by entering into this Indenture,
and each Noteholder, by accepting a Note, hereby covenant and
agree that they will not at any time institute against the
Seller or the Issuer, or join in any institution against the
Seller or the Issuer of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations
relating to the Notes, this Indenture or any of the Related
Documents.
SECTION 11.17. Inspection. The Issuer agrees that, on
reasonable prior notice, it will permit any representative of
the Trustee or of the Security Insurer, during the Issuer's
normal business hours, to examine all the books of account,
records, reports, and other papers of the Issuer, to make
copies and extracts therefrom, to cause such books to be
audited by independent certified public accountants, and to
discuss the
Issuer's affairs, finances and accounts with the Issuer's
officers, employees, and independent certified public
accountants, all at such reasonable times and as often as may
be reasonably requested. The Trustee shall and shall cause
its representatives to hold in confidence all such
information except to the extent disclosure may be required
by law (and all reasonable applications for confidential
treatment are unavailing) and except to the extent that the
Trustee may reasonably determine that such disclosure is
consistent with its obligations hereunder.
IN WITNESS WHEREOF, the Issuer and the Trustee have
caused this Indenture to be duly executed by their respective
officers, thereunto duly authorized, all as of the day and
year first above written.
AMERICREDIT RECEIVABLES FINANCE
CORP.
By:
Name:
Title:
LASALLE NATIONAL BANK,
not in its individual capacity
but solely as Trustee and
Indenture Collateral Agent,
By:
Name:
Title: Corporate Trust
Officer