EXHIBIT 10.6
(XL CAPITAL ASSURANCE(SM) LOGO)
1221 Avenue of the Americas
New York, New York 10020
Telephone: (212) 478-3400
FINANCIAL GUARANTY INSURANCE POLICY
OBLIGOR: AmeriCredit Automobile Receivables POLICY NO: CA03541A
Trust 2007-A-X
INSURED OBLIGATION: The $1,200,000,000 EFFECTIVE DATE: January 18, 2007
AmeriCredit Automobile Receivables Trust
2007-A-X Automobile Receivables Asset Backed
Notes, $217,000,000 Class A-1 Notes,
$348,000,000 Class A-2 Notes, $248,000,000
Class A-3 Notes and $387,000,000 Class A-4
Notes, issued by AmeriCredit Automobile
Receivables Trust 2007-A-X pursuant to the
Indenture.
XL CAPITAL ASSURANCE INC. ("XLCA"), a New York stock insurance company, in
consideration of the payment of the premium, hereby unconditionally and
irrevocably guarantees to the Trustee for the benefit of the Owners of the
Insured Obligations, full and complete payment by the Obligor of Scheduled
Payments in respect of the Insured Obligation, subject only to the terms of this
Policy (which includes the Endorsement(s) attached hereto).
XLCA will pay the Insured Amount to the Trustee upon the presentation of a
Payment Notice to XLCA on the later of (a) one (1) Business Day following
receipt by XLCA of a Payment Notice or (b) the Business Day on which Scheduled
Payments are due for payment. XLCA shall be subrogated to the Owners' rights to
payment on the Insured Obligations to the extent of any payment by XLCA
hereunder. The obligations of XLCA with respect to a Scheduled Payment will be
discharged to the extent funds to pay such Scheduled Payment are deposited in
the account specified in the Payment Notice, whether such funds are properly
applied by the Trustee or claimed by an Owner.
In addition, in the event that any Scheduled Payment which has become due
for payment and which is made to an Owner by or on behalf of the Trustee is
recovered or is recoverable from the Owner pursuant to a final order of a court
of competent jurisdiction in an Insolvency Proceeding that such payment
constitutes an avoidable preference to such Owner within the meaning of any
applicable bankruptcy law, XLCA unconditionally and irrevocably guarantees
payment of the amount of such recovery (in accordance with the Endorsement
attached hereto).
This Policy sets forth in full the undertaking of XLCA and shall not be
cancelled or revoked by XLCA for any reason, including failure to receive
payment of any premium due hereunder or under the Insurance Agreement, and may
not be further endorsed or modified without the written consent of XLCA. The
premium on this Policy is not refundable for any reason. This Policy does not
insure against loss of any prepayment or other acceleration payment which at any
time may become due in respect of any Insured Obligation, other than at the sole
option of XLCA, nor against any risk other than Nonpayment and Avoided Payment,
including any shortfalls, if any, attributable to the liability of the Obligor
for taxes or withholding taxes if any, including interest and penalties in
respect of such liability.
THIS POLICY IS NOT COVERED BY THE PROPERTY/CASUALTY INSURANCE SECURITY FUND
SPECIFIED IN ARTICLE 76 OF THE NEW YORK INSURANCE LAW.
Any capitalized terms not defined herein shall have the meaning given such
terms in the Endorsement attached hereto and forming a part hereof, or in the
Insurance Agreement referenced therein. In witness whereof, XLCA has caused this
Policy to be executed as of the Effective Date.
XL CAPITAL ASSURANCE INC. XL CAPITAL ASSURANCE INC.
/s/ Catherine R. Lau /s/ James W. Lundy, Jr.
- ------------------------------------- ----------------------------------------
Name: Catherine Lau Name: James W. Lundy, Jr.
Title: Senior Managing Director Title: Associate General Counsel
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FINANCIAL GUARANTY INSURANCE POLICY ENDORSEMENT NO. 1 EFFECTIVE
DATE JANUARY 18, 2007, ATTACHED TO AND FORMING
PART OF FINANCIAL GUARANTY INSURANCE
POLICY NO. CA03541A
Obligor: AmeriCredit Automobile Receivables Trust 2007-A-X
Insured Obligation: $1,200,000,000 AmeriCredit Automobile Receivables Trust
2007-A-X Automobile Receivables Asset Backed Notes,
$217,000,000 Class A-1 Notes, $348,000,000 Class A-2
Notes, $248,000,000 Class A-3 Notes and $387,000,000 Class
A-4 Notes, issued by AmeriCredit Automobile Receivables
Trust 2007-A-X pursuant to the Indenture
Beneficiary: Wells Fargo Bank, National Association, as trustee (the
"Trustee") under the Indenture dated as of January 9, 2007
(the "Indenture") between the Obligor and the Trustee.
Capitalized terms used herein and not otherwise defined herein or in
the Policy shall have the meanings assigned to them in the Insurance Agreement,
the Sale and Servicing Agreement or the Indenture as in effect on the date of
execution of this Policy without giving effect to any subsequent amendment or
modification thereto unless such amendment or modification has been approved in
writing by XLCA.
As used herein the term "Business Day" means any day other than
Saturday or Sunday on which commercial banking institutions in New York, New
York, Minneapolis, Minnesota and the State in which the executive offices of the
Servicer are located are generally open for banking business.
As used herein the term "Insolvency Proceeding" means the
commencement, after the date hereof, of any bankruptcy, insolvency, readjustment
of debt, reorganization, marshalling of assets and liabilities or similar
proceedings by or against any Person, the commencement, after the date hereof,
of any proceedings by or against any Person for the winding up or liquidation of
its affairs, or the consent, after the date hereof, to the appointment of a
trustee, conservator, receiver or liquidator in any bankruptcy, insolvency,
readjustment of debt, reorganization, marshalling of assets and liabilities or
similar proceedings of or relating to any Person.
As used herein the term "Insurance Agreement" means the Insurance
Agreement, dated as of January 9, 2007, by and among XLCA, the Obligor,
AmeriCredit, the Servicer, the Custodian, the Seller, the Trustee, the Trust
Collateral Agent, the Collateral Agent and the Backup Servicer,
As used herein the term "Insured Amount" means, that portion of the
Scheduled Payments that shall become due for payment but shall be unpaid by
reason of Nonpayment.
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As used herein the term "Nonpayment" means, with respect to any
Distribution Date, the failure of the Trustee to receive, in full, in accordance
with the terms of the Indenture that Scheduled Payment that is due for payment
with respect to such date.
As used herein the term "Owner" means the registered owner of any
Insured Obligation as indicated in the registration books maintained by or on
behalf of the Obligor for such purpose or, if the Insured Obligation is in
bearer form, the holder of the Insured Obligation.
As used herein, the term "Person" means an individual, a partnership,
a limited liability company, a joint venture, a corporation, a trust, an
unincorporated organization, and a government or any department or agency
thereof.
As used herein the term "Scheduled Payment" means for any Distribution
Date, the excess, if any (without duplication) of (i) the Noteholders' Interest
Distributable Amount plus the Noteholders' Parity Deficit Amount plus, if such
Distribution Date is the Final Scheduled Distribution Date for any Class of
Notes, the Outstanding Amount of such Class of Notes over (ii) the amount
actually deposited into the Note Distribution Account on or with respect to such
Distribution Date for application to the amounts described in the foregoing
clause (i), in accordance with the original terms of the Insured Obligations and
the Indenture when issued and without regard to any subsequent amendment or
modification of the Insured Obligations or the Indenture that has not been
consented to in writing by XLCA. Notwithstanding the foregoing, "Scheduled
Payments" shall in no event include payments which become due on an accelerated
basis as a result of (a) any default by the Obligor, (b) the occurrence of an
Event of Default under the Indenture, (c) mandatory or optional redemption, in
whole or in part, or (d) any other cause, unless XLCA elects, in its sole
discretion, to pay such amounts in whole or in part (in which event Scheduled
Payments shall include such accelerated payments as, when, and to the extent so
elected by XLCA). In the event that it does not make such election, Scheduled
Payments shall include payments due in accordance with the original scheduled
terms without regard to any acceleration. In addition, "Scheduled Payment" shall
not include, nor shall coverage be provided under the Policy in respect of, (i)
any make whole, redemption or call premium payable in respect of the Insured
Obligations, (ii) any amounts due in respect of the Insured Obligations
attributable to any increase in interest rate, penalty or other sum payable by
the Obligor by reason of any default or event of default in respect of the
Insured Obligations, or by reason of any deterioration of the creditworthiness
of the Obligor or (iii) any taxes, withholding or other charge imposed by any
governmental authority due in connection with the payment of any Scheduled
Payment to any holder of an Insured Obligation.
As used herein the term "Term of this Policy" means the period from
and including the Effective Date to and including the first date on which (i)
all Scheduled Payments have been paid that are required to be paid by the
Obligor under the Indenture; and (ii) any period during which any Scheduled
Payment could have been avoided in whole or in part as a preference payment
under applicable bankruptcy, insolvency, receivership or similar law has
expired; provided, however, that if any proceedings
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requisite to avoidance as a preference payment have been commenced prior to the
occurrence of (i) and (ii) above, and the Owners are ultimately required to
return any Avoided Payment (as defined below) as a result of such proceeding
pursuant to a final and nonappealable order in resolution of any such proceeding
(whether or not such order is entered before or after the occurrence of (i) and
(ii) above), then the Term of the Policy shall terminate on the date on which
XLCA has made all payments required to be made under the terms of this Policy in
respect of all such Avoided Payments.
To make a claim under the Policy, the Trustee shall deliver to XLCA a
Payment Notice in the form of Exhibit A hereto (a "Payment Notice"),
appropriately completed and executed by the Trustee. A Payment Notice under this
Policy may be presented to XLCA by (i) delivery of the original Payment Notice
to XLCA at its address set forth below, or (ii) facsimile transmission of the
original Payment Notice to XLCA at its facsimile number set forth below. If
presentation is made by facsimile transmission, the Trustee shall (x)
simultaneously confirm transmission by telephone to XLCA at its telephone number
set forth below, and (y) as soon as reasonably practicable, deliver the original
Payment Notice to XLCA at its address set forth below. Any Payment Notice
received by XLCA after 10:00 a.m., New York City time, on a Business Day, or on
any day that is not a Business Day, will be deemed to be received by XLCA at
9:00 a.m., New York City time, on the next succeeding Business Day. XLCA shall
make payments due in respect of Insured Amounts no later than 2:00 p.m. New York
City time to the Trustee upon the presentation of a Payment Notice to XLCA on
the later of (a) one (1) Business Day following receipt by XLCA of a Payment
Notice or (b) the Business Day on which Scheduled Payments are due for payment.
Subject to the foregoing, if the payment of any amount with respect to
the Scheduled Payment is voided (a "Preference Event") as a result of an
Insolvency Proceeding and as a result of such Preference Event, the Owner is
required to return such voided payment, or any portion of such voided payment,
made in respect of the Insured Obligation (an "Avoided Payment"), XLCA will pay
an amount equal to such Avoided Payment, as and when such payment would
otherwise be due pursuant to the Indenture without regard to acceleration or
prepayment, and upon payment of such Avoided Payment and receipt by XLCA from
the Trustee on behalf of such Owner of (x) a certified copy of a final order of
a court exercising jurisdiction in such Insolvency Proceeding to the effect that
the Owner or the Trustee on behalf of the Owner is required to return any such
payment or portion thereof because such payment was voided under applicable law,
with respect to which order the appeal period has expired without an appeal
having been filed (the "Final Order"), (y) an assignment, substantially in the
form attached hereto as Exhibit B, properly completed and executed by such Owner
irrevocably assigning to XLCA all rights and claims of such Owner relating to or
arising under such Avoided Payment, and (z) a Payment Notice in the form of
Exhibit A hereto appropriately completed and executed by the Trustee.
XLCA shall make payments due in respect of Avoided Payments no later
than 2:00 p.m. New York City time on the Business Day following XLCA's receipt
of the documents required under clauses (x) through (z) of the preceding
paragraph. Any such documents received by XLCA after 10:00 a.m. New York City
time on any Business Day
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or on any day that is not a Business Day shall be deemed to have been received
by XLCA at 9:00 a.m., New York City time, on the next succeeding Business Day.
All payments made by XLCA hereunder on account of any Avoided Payment shall be
disbursed to the receiver, conservator, debtor-in-possession or trustee in
bankruptcy named in the Final Order and not to any Holder directly (unless a
Holder previously paid such amount to the receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the Final Order, in which
case such payment shall be disbursed to the Trustee for distribution to such
Holder upon proof of such payment reasonably satisfactory to XLCA).
XLCA hereby waives and agrees not to assert any and all rights to
require the Trustee to make demand on or to proceed against any person, party or
security prior to the Trustee demanding payment under this Policy.
No defenses, set-offs and counterclaims of any kind available to XLCA
so as to deny payment of any amount due in respect of this Policy will be valid
and XLCA hereby waives and agrees not to assert any and all such defenses
(including without limitation, defense of fraud in the inducement or fact or any
other circumstances which would have the effect of discharging a surety in law
or in equity), set-offs and counterclaims, including, without limitation, any
such rights acquired by subrogation, assignment or otherwise. Upon any payment
hereunder, in furtherance and not in limitation of XLCA's equitable right of
subrogation and XLCA's rights under the Insurance Agreement, XLCA will be
subrogated to the rights of the Owner in respect of which such payment was made
to receive any and all amounts due in respect of the obligations in respect of
which XLCA has made a payment hereunder. Any rights of subrogation acquired by
XLCA as a result of any payment made under this Policy shall, in all respects,
be subordinate and junior in right of payment to the prior indefeasible payment
in full of any amounts due the Owner on account of payments due under the
Insured Obligation.
This Policy is neither transferable nor assignable, in whole or in
part, except to a successor trustee duly appointed and qualified under the
Indenture. All Payment Notices and other notices, presentations, transmissions,
deliveries and communications made by the Trustee to XLCA with respect to this
Policy shall specifically refer to the number of this Policy and shall be made
to XLCA at:
XL Capital Assurance Inc.
1221 Avenue of the Americas
New York, New York 10020
Attention: Surveillance
Telephone: (212) 478-3400
Facsimile: (212) 478-3597
or such other address, telephone number or facsimile number as XLCA may
designate to the Trustee in writing from time to time. Each such Payment Notice
and other notice, presentation, transmission, delivery and communication shall
be effective only upon actual receipt by XLCA.
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The obligations of XLCA under this Policy are irrevocable, primary,
absolute and unconditional, subject to satisfaction of the conditions for making
a claim under the Policy, and neither the failure of any Person to perform any
covenant or obligation in favor of XLCA (or otherwise), nor the failure or
omission to make a demand permitted hereunder, nor the failure of any assignment
or grant of any security interest, nor the commencement of any Insolvency
Proceeding by or against the Obligor, the Seller, the Servicer, the Trustee or
any other person shall in any way affect or limit XLCA's obligations under this
Policy. If a successful action or proceeding to enforce this Policy is brought
by the Trustee, the Trustee shall be entitled to recover from XLCA costs and
expenses reasonably incurred, including, without limitation, reasonable fees and
expenses of counsel.
This Policy and the obligations of XLCA hereunder shall terminate on
the expiration of the Term of this Policy. This Policy shall be returned to XLCA
by the Trustee upon the expiration of the Term of this Policy.
The foregoing notwithstanding, if an Insolvency Proceeding is existing
by or against the Obligor, the Seller or the Servicer during the one year and
one day period set forth in clauses (ii) or (iii) of the definition of "Term of
this Policy" above, then this Policy and XLCA's obligations hereunder shall
terminate on (and the "Termination Date" shall be) the later of (i) the date of
the conclusion or dismissal of such Insolvency Proceeding without continuing
jurisdiction by the court in such Insolvency Proceeding, and (ii) the date on
which XLCA has made all payments required to be made under the terms of this
Policy in respect of Avoided Payments.
The Property/Casualty Insurance Security Fund specified in Article 76
of the New York Insurance Law does not cover this Policy. The Florida Insurance
Guaranty Association created under Part II of Chapter 631 of the Florida
Insurance Code does not cover this Policy. In the event that XLCA were to become
insolvent, the California Insurance Guaranty Association, established pursuant
to Article 14.2 of Chapter 1 of Part 2 of Division 1 of the California Insurance
Code excludes from coverage any claims arising under this Policy.
THIS POLICY SHALL BE CONSTRUED, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED, IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES
THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION.
In the event any term or provision of the form of this Policy is
inconsistent with the provision of this Endorsement, the provision of this
Endorsement shall take precedence and be binding.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, XL Capital Assurance Inc. has caused this
Endorsement to the Policy to be executed on the Effective Date.
/s/ Catherine Lau James W. Lundy, Jr.
- ------------------------------------- ----------------------------------------
Name: Catherine Lau Name: James W. Lundy, Jr.
Title: Senior Managing Director Title: Associate General Counsel
Policy No. CA03541A
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EXHIBIT A TO FINANCIAL GUARANTY POLICY NO. CA03541A
XL Capital Assurance Inc.
1221 Avenue of the Americas
New York, New York 10020
Attention: Surveillance
PAYMENT NOTICE
UNDER FINANCIAL GUARANTY POLICY NO. CA03541A
[ Identify Trustee] as Trustee (the "Trustee"), hereby certifies to XL
Capital Assurance Inc. ("XLCA") with reference to that certain Financial
Guaranty Policy, No. CA03541A, dated January 9, 2007 (the "Policy"), issued by
XLCA in favor of the Trustee on behalf of the Owner under the Indenture, as
follows:
1. The Trustee is the trustee under the Indenture and the beneficiary
on behalf of each Owner of the Policy.
2. Trustee is entitled to make a demand under the Policy pursuant to
the Sale and Servicing Agreement.
3. This notice relates to the [insert date] [Distribution Date]. The
amount demanded is to be paid in immediately available funds to the [Specify
Account] at [Identify Financial Institution Holding Account] account number
[_____] which is the "Note Distribution Account."
[For a Payment Notice in respect of Insured Amounts other than Avoided
Payment, use paragraph 4.]
4. The Trustee demands payment of $________ which is an amount equal
to [Describe calculation of the Insured Amount under Policy].
[For a Payment Notice in respect of an Avoided Payment use the following
paragraphs [4] or [5].]
[4.] or [5.] The Trustee hereby represents and warrants, based upon
information available to it, that (i) the amount entitled to be drawn under the
Policy on the date hereof in respect of Avoided Payments is the amount paid or
to be paid simultaneously with such draw on the Policy, by the Owner on account
of a Preference Event [$________] (the "Avoided Payment Amount"), (ii) the Owner
with respect to which the drawing is being made under the Policy has paid or
simultaneously with such
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draw on the Policy will pay such Avoided Payment Amount, and (iii) the documents
required by the Policy to be delivered in connection with such Avoided Payment
and Avoided Payment Amount have previously been presented to XLCA or are
attached hereto.
[6] The Trustee agrees that, following payment of funds by XLCA, it
shall use reasonable efforts to procure (a) that such amounts are applied
directly to the payment of any Insured Amount which is due for payment; (b) that
such funds are not applied for any other purpose; and (c) the maintenance of
accurate record of such payments in respect of the Insured Obligation and the
corresponding claim on the Policy and the proceeds thereof.
[7] The Trustee, on behalf of itself and the Owners, hereby assigns to
XLCA all rights and claims (including rights of actions and claims in respect of
securities laws violations or otherwise) of the Trustee and the Owners with
respect to the Insured Obligation to the extent of any payments under the
Policy. The foregoing assignment is in addition to, and not in limitation of,
rights of subrogation otherwise available to XLCA in respect of such payments.
The Trustee shall take such action and deliver such instruments as may be
reasonably required by XLCA to effectuate the purposes of the provisions of this
Clause 7.
[8] The Trustee, on behalf of itself and the Owners, hereby appoints
XLCA as agent and attorney-in-fact for the Trustee and the Owners in any legal
proceeding in respect of the Insured Obligation. The Trustee, on behalf of
itself and the Owners, thereby (and without limiting the generality of the
preceding sentence) agrees that XLCA may at any time during the continuation of
any proceeding by or against any debtor with respect to which a Preference Claim
(as defined below) or other claim with respect to the Insured Obligation is
asserted under any Insolvency Proceeding, direct all matters relating to such
Insolvency Proceeding, including, without limitation, (a) all matters relating
to any claim in connection with a Insolvency Proceeding seeking the avoidance as
a preferential transfer of any payment made with respect to the obligations (a
"Preference Claim"), (b) the direction of any appeal of any order relating to
any Preference Claim and (c) the posting of any surety, supersedes or
performance bond pending any such appeal. In addition, the Trustee, on behalf of
itself and the Owners, hereby agrees that XLCA shall be subrogated to, and the
Trustee, on behalf of itself and the Owners, hereby delegates and assigns, to
the fullest extent permitted by law, the rights of the Trustee and the Owners in
the conduct of any Insolvency Proceeding, including, without limitation, all
rights of any party to an adversary proceeding or action with respect to any
court order issued in connection with any such Insolvency Proceeding, to the
extent of any payment under the Policy.
Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to them in the Policy or the Indenture.
IN WITNESS WHEREOF, this notice has been executed this ____ day of
________, ____.
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____________________, as Trustee
By:
------------------------------------
Authorized Officer
Any Person Who Knowingly And With Intent To Defraud Any Insurance Company Or
Other Person Files An Application For Insurance Or Statement Of Claim Containing
Any Materially False Information, Or Conceals For The Purpose Of Misleading
Information Concerning Any Fact Material Thereof, Commits A Fraudulent Insurance
Act, Which Is A Crime, And Shall Also Be Subject To A Civil Penalty Not To
Exceed Five Thousand Dollars And The Stated Value Of The Claim For Each Such
Violation
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EXHIBIT B TO FINANCIAL GUARANTY INSURANCE POLICY, NO. CA03541A
FORM OF ASSIGNMENT
Reference is made to the Financial Guaranty Insurance Policy No. CA03541A,
dated January 18, 2007 (together with the Endorsement attached thereto, the
"Policy") issued by XL Capital Assurance Inc. ("XLCA") relating to the Class
[[]] Notes issued by AmeriCredit Automobile Receivables Trust 2007-A-X pursuant
to that certain Indenture dated as of January 18, 2007. Unless otherwise defined
herein, capitalized terms used in this Assignment shall have the meanings
assigned thereto in the Policy as incorporated by reference therein. In
connection with the Avoided Payment of [$_____] paid by the undersigned (the
"Owner") on [_____] and the payment by XLCA in respect of such Avoided Payment
pursuant to the Policy, the Owner hereby irrevocably and unconditionally,
without recourse, representation or warranty (except as provided below), sells,
assigns, transfers, conveys and delivers all of such Owner's rights, title and
interest in and to any rights or claims, whether accrued, contingent or
otherwise, which the Owner now has or may hereafter acquire, against any person
relating to, arising out of or in connection with such Avoided Payment. The
Owner represents and warrants that such claims and rights are free and clear of
any lien or encumbrance created or incurred by such Owner.(1)
----------------------------------------
Owner
- ----------
(1) In the event that the terms of this form of assignment are reasonably
determined to be insufficient solely as a result of a change of law or
applicable rules after the date of the Policy to fully vest all of the
Owner's right, title and interest in such rights and claims, the Owner and
XLCA shall agree on such other form as is reasonably necessary to effect
such assignment, which assignment shall be without recourse, representation
or warranty except as provided above.