EXHIBIT 4.2
VOLKSWAGEN AUTO LEASE TRUST 20[__]-[__]
[_____]% Auto Lease Asset Backed Notes, Class A-1
[_____]% Auto Lease Asset Backed Notes, Class A-2
[_____]% Auto Lease Asset Backed Notes, Class A-3
[_____]% Auto Lease Asset Backed Notes, Class A-4
[__________],
as Indenture Trustee,
and
VOLKSWAGEN AUTO LEASE TRUST 20[__]-[__],
as Issuer
INDENTURE
Dated as of [___________], [____]
TRUST INDENTURE ACT CROSS-REFERENCE CHART
(THIS CHART IS NOT A PART OF THIS INDENTURE)
TIA SECTION INDENTURE REFERENCE
- ----------- -------------------
310(a)(1)................................................. 6.8, 6.11
310(a)(2)................................................. 6.8, 6.11
310(a)(3)................................................. 6.10(b)
310(a)(4)................................................. Not applicable
310(a)(5)................................................. 6.11
310(b).................................................... 6.11
310(c).................................................... Not applicable
311(a).................................................... 6.15
311(b).................................................... 6.15
311(c).................................................... Not applicable
312(a).................................................... 7.1, 7.2(a)
312(b).................................................... 7.2(b)
312(c).................................................... 7.2(c)
313(a).................................................... 7.3
313(b).................................................... 7.3
313(c).................................................... 7.3
313(d).................................................... 7.3
314(a).................................................... 3.9
314(b).................................................... 3.6
314(c)(1)................................................. 11.1(a)
314(c)(2)................................................. 11.1(a)
314(c)(3)................................................. 11.1(a)
314(d).................................................... 11.1(b)
314(e).................................................... 11.1(a)
315(a).................................................... 6.1(b)
315(b).................................................... 6.5
315(c).................................................... 6.1(a)
315(d).................................................... 6.1(c)
315(d)(1)................................................. 6.1(b), 6.1(c)(i)
315(d)(2)................................................. 6.1(c)(ii)
315(d)(3)................................................. 6.1(c)(iii)
315(e).................................................... 5.13
316(a)(1)(A).............................................. 5.11
316(a)(1)(B).............................................. 5.12
316(a)(2)................................................. Not Applicable
316(b).................................................... 5.7
316(c).................................................... 5.6(b)
317(a)(1)................................................. 5.3(a), 5.3(b)
317(a)(2)................................................. 5.3(d)
317(b).................................................... 3.3
318(a).................................................... 11.17
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS.................................................... 2
Section 1.1 Definitions............................................. 2
Section 1.2 Interpretive Provisions................................. 2
ARTICLE II THE NOTES..................................................... 2
Section 2.1 Form.................................................... 2
Section 2.2 Execution, Authentication and Delivery.................. 2
Section 2.3 Temporary Notes......................................... 3
Section 2.4 Registration; Registration of Transfer and Exchange..... 3
Section 2.5 Mutilated, Destroyed, Lost or Stolen Notes.............. 5
Section 2.6 Persons Deemed Owners................................... 6
Section 2.7 Cancellation............................................ 6
Section 2.8 Release of Collateral................................... 6
Section 2.9 Book-Entry Notes........................................ 6
Section 2.10 Notices to Clearing Agency.............................. 7
Section 2.11 Definitive Notes........................................ 7
Section 2.12 Authenticating Agents................................... 8
Section 2.13 Tax Treatment........................................... 8
ARTICLE III REPRESENTATIONS, WARRANTIES AND COVENANTS.................... 9
Section 3.1 Payment of Principal and Interest....................... 9
Section 3.2 Maintenance of Office or Agency......................... 9
Section 3.3 Money for Payments to be Held in Trust.................. 9
Section 3.4 Existence............................................... 11
Section 3.5 Protection of Collateral................................ 11
Section 3.6 Opinions as to Collateral............................... 11
Section 3.7 Performance of Obligations; Administration of the
Transaction SUBI Assets.............................. 12
Section 3.8 Negative Covenants...................................... 12
Section 3.9 Issuer Certificates and Reports......................... 13
Section 3.10 Restrictions on Certain Other Activities................ 14
Section 3.11 Notice of Defaults...................................... 14
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Section 3.12 Further Instruments and Acts............................ 14
Section 3.13 Delivery of Transaction SUBI Certificate................ 14
Section 3.14 Compliance with Laws.................................... 15
Section 3.15 Perfection Representations.............................. 15
Section 3.16 '34 Act Filings......................................... 15
ARTICLE IV SATISFACTION AND DISCHARGE.................................... 15
Section 4.1 Satisfaction and Discharge of Indenture................. 15
Section 4.2 Application of Trust Money.............................. 16
Section 4.3 Repayment of Monies Held by Paying Agent................ 16
ARTICLE V INDENTURE DEFAULT.............................................. 16
Section 5.1 Indenture Defaults...................................... 16
Section 5.2 Acceleration of Maturity; Waiver of Indenture Default... 18
Section 5.3 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.................................... 18
Section 5.4 Remedies; Priorities.................................... 20
Section 5.5 Optional Preservation of the Transaction SUBI Assets.... 22
Section 5.6 Limitation of Suits..................................... 22
Section 5.7 Unconditional Rights of Noteholders to Receive Principal
and Interest......................................... 23
Section 5.8 Restoration of Rights and Remedies...................... 23
Section 5.9 Rights and Remedies Cumulative.......................... 24
Section 5.10 Delay or Omission Not a Waiver.......................... 24
Section 5.11 Control by Noteholders.................................. 24
Section 5.12 Waiver of Past Defaults................................. 24
Section 5.13 Undertaking for Costs................................... 25
Section 5.14 Waiver of Stay or Extension Laws........................ 25
Section 5.15 Action on Notes......................................... 25
Section 5.16 Performance and Enforcement of Certain Obligations...... 25
Section 5.17 Sale of Collateral...................................... 26
ARTICLE VI THE INDENTURE TRUSTEE......................................... 27
Section 6.1 Duties of Indenture Trustee............................. 27
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Section 6.2 Rights of Indenture Trustee............................. 28
Section 6.3 Individual Rights of Indenture Trustee.................. 29
Section 6.4 Indenture Trustee's Disclaimer.......................... 29
Section 6.5 Notice of Defaults...................................... 30
Section 6.6 Reports by Indenture Trustee to Noteholders............. 30
Section 6.7 Compensation and Indemnity.............................. 30
Section 6.8 Removal, Resignation and Replacement of Indenture
Trustee.............................................. 31
Section 6.9 Successor Indenture Trustee by Merger................... 32
Section 6.10 Appointment of Co-Trustee or Separate Trustee........... 32
Section 6.11 Eligibility; Disqualification........................... 34
Section 6.12 Trustee as Holder of Transaction SUBI Certificate....... 34
Section 6.13 Representations and Warranties of Indenture Trustee..... 34
Section 6.14 Furnishing of Documents................................. 34
Section 6.15 Preferential Collection of Claims Against the Issuer.... 35
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS............................... 35
Section 7.1 Issuer to Furnish Indenture Trustee Noteholder Names and
Addresses............................................ 35
Section 7.2 Preservation of Information; Communications to
Noteholders.......................................... 35
Section 7.3 Reports by Indenture Trustee............................ 35
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES........................ 35
Section 8.1 Collection of Money..................................... 35
Section 8.2 Accounts................................................ 36
Section 8.3 Servicer Certificate.................................... 36
Section 8.4 Disbursement of Funds................................... 38
Section 8.5 General Provisions Regarding Accounts................... 40
Section 8.6 Release of Collateral................................... 41
ARTICLE IX SUPPLEMENTAL INDENTURES....................................... 41
Section 9.1 Supplemental Indentures Without Consent of Noteholders.. 41
Section 9.2 Supplemental Indentures With Consent of Noteholders..... 43
Section 9.3 Execution of Supplemental Indentures.................... 43
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(continued)
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Section 9.4 Effect of Supplemental Indenture........................ 44
Section 9.5 Reference in Notes to Supplemental Indentures........... 44
ARTICLE X REDEMPTION OF NOTES............................................ 44
Section 10.1 Redemption.............................................. 44
Section 10.2 Form of Redemption Notice............................... 45
Section 10.3 Notes Payable on Redemption Date........................ 45
ARTICLE XI MISCELLANEOUS................................................. 46
Section 11.1 Compliance Certificates and Opinions.................... 46
Section 11.2 Form of Documents Delivered to the Indenture Trustee.... 47
Section 11.3 Acts of Noteholders..................................... 48
Section 11.4 Notices................................................. 48
Section 11.5 Notices to Noteholders; Waiver.......................... 49
Section 11.6 Effect of Headings and Table of Contents................ 49
Section 11.7 Successors and Assigns.................................. 49
Section 11.8 Severability............................................ 50
Section 11.9 Benefits of Indenture................................... 50
Section 11.10 Legal Holidays.......................................... 50
Section 11.11 Governing Law........................................... 50
Section 11.12 Counterparts............................................ 50
Section 11.13 Recording of Indenture.................................. 50
Section 11.14 Trust Obligation; No Recourse........................... 50
Section 11.15 No Petition............................................. 51
Section 11.16 Limitation of Liability of Owner Trustee................ 51
Section 11.17 TIA Incorporation and Conflicts......................... 51
Section 11.18 Intent.................................................. 51
Section 11.19 Each SUBI Separate; Assignees of SUBI................... 52
Section 11.20 Submission to Jurisdiction; Waiver of Jury Trial........ 52
Section 11.21 Subordination of Claims................................. 53
Section 11.22 Information Requests.................................... 53
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Section 11.23 Regulation AB Information to be Provided by the
Indenture Trustee.................................... 53
SCHEDULE I PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS
EXHIBIT A FORM OF NOTE
EXHIBIT B FORM OF DEPOSITORY AGREEMENT
EXHIBIT C SERVICING CRITERIA TO BE ADDRESSED IN INDENTURE TRUSTEE'S ASSESSMENT
OF COMPLIANCE
EXHIBIT D FORM OF INDENTURE TRUSTEE'S ANNUAL CERTIFICATION
APPENDIX A DEFINITIONS
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THIS INDENTURE, dated as of [__________], [_____], (this "Indenture") is
between VOLKSWAGEN AUTO LEASE TRUST 20[__]-[__], a Delaware statutory trust (the
"Issuer"), and [__________], [a national banking association], as trustee (the
"Indenture Trustee").
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 [_____]% Auto Lease
Asset Backed Notes, Class A-1 (the "Class A-1 Notes"), [_____]% Auto Lease Asset
Backed Notes, Class A-2 (the "Class A-2 Notes"), [_____]% Auto Lease Asset
Backed Notes, Class A-3 (the "Class A-3 Notes"), [_____]% Auto Lease Asset
Backed Notes, Class A-4 (the "Class A-4 Notes" and together with the Class A-1
Notes, the Class A-2 Notes and the Class A-3 Notes, the "Notes"):
GRANTING CLAUSE
The Issuer, to secure the payment of principal of and interest on, and any
other amounts owing in respect of, the Notes equally and ratably without
prejudice, priority or distinction except as set forth herein, and to secure
compliance with the provisions of this Indenture, hereby Grants in trust to the
Indenture Trustee on the Closing Date, as trustee for the benefit of the
Noteholders, all of such Person's right, title and interest, whether now owned
or hereafter acquired, in and to (i) the Trust Estate and (ii) 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 all 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, securities, financial assets and other
property that at any time constitute all or part of or are included in the
proceeds of any of the foregoing (collectively, the "Collateral"), in each case
as such terms are defined herein.
The Indenture Trustee, as trustee on behalf of the Noteholders,
acknowledges the foregoing Grant, accepts the trusts under this Indenture in
accordance with the provisions of this Indenture and agrees to perform its
duties required in this Indenture.
Notwithstanding any statement to the contrary contained in any Transaction
Document, neither the Indenture Trustee nor any of the Noteholders shall have
any security interest in any funds held by the Qualified Intermediary or in any
Qualified Intermediary Account which represent Sales Proceeds with respect to
any of the Transaction Vehicles relating to the Transaction Units, and such
funds shall not constitute Collateral; provided, however, that Sales Proceeds
from the sale of any Transaction Vehicle received after the exercise of remedies
with respect to a Default pursuant to Article V shall not be deposited with the
Qualified Intermediary or into any Qualified Intermediary Account, and nothing
contained herein shall limit any right of the Indenture Trustee or any
Noteholder with respect to Sales Proceeds received after such exercise of
remedies. It is the intention of the parties hereto that the preceding sentence
shall satisfy the requirements of Treasury Regulation Section 1.1031(k)-1(g)(4),
which requires that the Issuer, the Transferor and their respective Affiliates
not have the right to receive, pledge, borrow or otherwise obtain the benefits
of money or other property held by the Qualified Intermediary.
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINITIONS. Capitalized terms used herein that are not
otherwise defined herein shall have the meanings ascribed thereto in Appendix A
hereto.
SECTION 1.2 INTERPRETIVE PROVISIONS.
(a) For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires, (i) terms used in this
Indenture include, as appropriate, all genders and the plural as well as the
singular, (ii) references to words such as "herein", "hereof" and the like shall
refer to this Indenture as a whole and not to any particular part, Article or
Section within this Indenture, (iii) the term "include" and all variations
thereof shall mean include without limitation and (iv) the term "proceeds" shall
have the meaning set forth in the applicable UCC.
(b) As used in this Indenture and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Indenture or in any such certificate or other document, and accounting
terms partly defined in this Indenture or in any such certificate or other
document to the extent not defined, shall have the respective meanings given to
them under generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Indenture or in any such certificate or
other document are inconsistent with the meanings of such terms under generally
accepted accounting principles, the definitions contained in this Indenture or
in any such certificate or other document shall control.
ARTICLE II
THE NOTES
SECTION 2.1 FORM. The Notes, together with the Indenture Trustee's
certificate of authentication, shall be in substantially the form set forth as
Exhibit A hereto, 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 such 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 such Note.
The terms of the Notes set forth in Exhibit A hereto are part of the terms
of this Indenture.
SECTION 2.2 EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be
executed by the Owner Trustee on behalf of the Issuer by any of its Authorized
Officers. The signature of any Authorized Officer of the Owner Trustee on the
Notes may be manual or by facsimile. Notes bearing the manual or facsimile
signature of individuals who were at any time Authorized Officers of the Owner
Trustee shall bind the Issuer, notwithstanding that any such individuals
2
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 Indenture Trustee shall, upon Issuer Order, authenticate and deliver
for original issue the following aggregate principal amounts of the Notes: (i)
$[_____] of Class A-1 Notes, (ii) $[_____] of Class A-2 Notes, (iii) $[_____] of
Class A-3 Notes, and (iv) $[_____] of Class A-4 Notes. The aggregate principal
amount of Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4 Notes
outstanding at any time may not exceed such respective amounts, 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 book-entry form in minimum denominations of
$100,000 and in integral multiples of $1,000 in excess thereof; provided,
however, that on the Closing Date, one Class A-1 Note, one Class A-2 Note, one
Class A-3 Note and one Class A-4 Note may be issued in a denomination that
includes any remaining portion of the Initial Class A-1 Note Balance, the
Initial Class A-2 Note Balance, the Initial A-3 Note Balance and the Initial A-4
Note Balance, respectively.
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
Indenture 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 Indenture
Trustee shall authenticate and deliver, temporary Notes that are printed,
lithographed, typewritten, mimeographed or otherwise produced, substantially 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 shall 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 such temporary Notes at the office or agency of the Issuer to be
maintained as provided in Section 3.2, without charge to the related Noteholder.
Upon surrender for cancellation of any one or more temporary Notes, the Issuer
shall execute and the Indenture Trustee shall authenticate and deliver in
exchange therefor, a like principal amount of Definitive Notes of authorized
denominations. Until so exchanged, such 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
Indenture Trustee is hereby appointed the "Note Registrar" for the purpose of
registering Notes and transfers of Notes as herein provided. Upon any
resignation of
3
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 Indenture Trustee is appointed by the Issuer as
Note Registrar, the Issuer shall give the Indenture Trustee prompt written
notice of such appointment and the location, and any change in such location, of
the Note Register, and the Indenture Trustee shall have the right to inspect the
Note Register at all reasonable times and to obtain copies thereof, and the
Indenture Trustee shall have the right to rely upon a certificate executed on
behalf of the Note Registrar by an Authorized Officer of the Note Registrar as
to the names and addresses of the Noteholders 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, if the
requirements of Section 8-401 of the UCC are met, the Issuer shall execute and
the Indenture Trustee shall authenticate and the related Noteholder shall obtain
from the Indenture Trustee, in the name of the designated transferee, one or
more new Notes in any authorized denominations, of the same Class and a like
aggregate principal amount.
At the option of the related Noteholder, Notes may be exchanged for other
Notes in any authorized denominations, of the same Class and a like aggregate
principal amount, upon surrender of such Notes at such office or agency.
Whenever any Notes are so surrendered for exchange, if the requirements of
Section 8-401 of the UCC are met, the Issuer shall execute, the Indenture
Trustee shall authenticate and the Noteholder shall obtain from the Indenture
Trustee the Notes that the Noteholder making such exchange is entitled to
receive.
Every Note presented or surrendered for registration of transfer or
exchange shall (if so required by the Issuer or the Indenture Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form and
substance satisfactory to the Issuer and the Indenture Trustee, duly executed by
the Noteholder thereof or its attorney-in-fact duly authorized in writing.
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.
No service charge shall be made to a Noteholder for any registration of
transfer or exchange of Notes, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith, other than exchanges pursuant to Sections 2.3 or 9.5 not
involving any transfer.
By acquiring a Note (or any interest therein), each purchaser and
transferee shall be deemed to represent and warrant that either (a) it is not
acquiring such Note (or any interest therein) with the plan assets of an
"employee benefit plan" as defined in Section 3(3) of ERISA, which is subject to
Title I of ERISA, a "plan" as defined in Section 4975 of the Code, an entity
whose underlying assets include "plan assets" of any of the foregoing, or a
governmental plan as defined in Section 3(32) of ERISA which is subject to
applicable law that is substantially similar to the fiduciary responsibility
provisions of ERISA or Section 4975 of the Code; or (b) the
4
acquisition and holding of such Note (or interest therein) will not give rise to
a nonexempt prohibited transaction under ERISA or Section 4975 of the Code (or,
in the case of a governmental plan, any substantially similar law).
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 any Note (i) selected for redemption or (ii) for a period of 15
days preceding the due date for any payment with respect to such Note.
SECTION 2.5 MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by it to hold the Issuer and the Indenture Trustee
harmless, then, in the absence of notice to the Issuer, the Note Registrar or
the Indenture Trustee that such Note has been acquired by a "protected
purchaser" (as contemplated by Article 8 of the UCC), and provided that the
requirements of Section 8-405 of the UCC are met, the Issuer shall execute and
upon Issuer Request the Indenture 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
become due and payable, or shall have been called for redemption, instead of
issuing a replacement Note, the Issuer may upon delivery of the security or
indemnity herein required pay such destroyed, lost or stolen Note when so due or
payable or upon the Redemption Date without the 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 "protected purchaser" (as
contemplated by Article 8 of the UCC) of the original Note in lieu of which such
replacement Note was issued presents for payment such original Note, the Issuer
and the Indenture 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 "protected purchaser" (as contemplated by
Article 8 of the UCC), 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 Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the Issuer or
the Indenture Trustee may require the payment by the related Noteholder 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 Indenture 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.
5
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 PERSONS DEEMED OWNERS. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and
their respective agents may treat the Person in whose name any Note is
registered (as of the date 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
neither the Issuer, the Indenture Trustee nor any of their respective agents
shall be affected by notice to the contrary.
SECTION 2.7 CANCELLATION. All Notes surrendered for payment, registration
of transfer, exchange or redemption shall, if surrendered to any Person other
than the Indenture Trustee, be delivered to the Indenture Trustee and shall be
promptly cancelled by the Indenture Trustee. The Issuer may at any time deliver
to the Indenture Trustee for cancellation any Notes previously authenticated and
delivered hereunder that the Issuer may have acquired in any manner whatsoever,
and all Notes so delivered shall be promptly cancelled by the Indenture Trustee.
No Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Notes may be held or disposed of by the Indenture
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
that such Notes have not been previously disposed of by the Indenture Trustee.
SECTION 2.8 RELEASE OF COLLATERAL. Subject to Section 11.1 and the terms of
those Transaction Documents to which the Indenture Trustee is a party, the
Indenture Trustee shall release property from the lien of this Indenture only
upon receipt of an Issuer Request.
SECTION 2.9 BOOK-ENTRY NOTES. Unless otherwise specified herein, the Notes,
upon original issuance, will be issued in the form of one or more typewritten
Notes representing the Book-Entry Notes, to be delivered to the Indenture
Trustee, as agent for DTC, the initial Clearing Agency, by, or on behalf of, the
Issuer. One fully registered Note shall be issued with respect to each $500
million in principal amount of each Class of Notes or such lesser amount as
necessary. Such Notes shall initially be registered on the Note Register in the
name of Cede & Co., the nominee of the initial Clearing Agency, and no Note
Owner shall receive a Definitive Note representing such Note Owner's interest in
such Note except as provided in Section 2.11. Unless and until Definitive Notes
have been issued to Note Owners pursuant to Section 2.11:
(a) the provisions of this Section shall be in full force and effect;
(b) the Note Registrar and the Indenture Trustee shall be entitled to
deal with the Clearing Agency for all purposes of this Indenture (including the
payment of principal of and interest on the Notes and the giving of instructions
or directions hereunder) as the sole Noteholder, and shall have no obligation to
Note Owners;
6
(c) to the extent that the provisions of this Section conflict with
any other provisions of this Indenture, the provisions of this Section shall
control;
(d) the rights of Note Owners shall be exercised only through the
Clearing Agency and shall be limited to those established by law and agreements
between or among such Note Owners and the Clearing Agency or Clearing Agency
Participants; pursuant to the Depository Agreement, unless and until Definitive
Notes are issued pursuant to Section 2.11, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive and
transmit payments of principal of and interest on the Notes to such Clearing
Agency Participants; and
(e) whenever this Indenture requires or permits actions to be taken
based upon instructions or directions of Noteholders evidencing a specified
percentage of the Outstanding Note Amount, the Clearing Agency shall be deemed
to represent such percentage only to the extent that it has received
instructions to such effect from Note Owners or Clearing Agency Participants
owning or representing, respectively, such required percentage of the beneficial
interest in the Notes and has delivered such instructions to the Indenture
Trustee.
SECTION 2.10 NOTICES TO CLEARING AGENCY. Whenever a notice or other
communication to Noteholders is required under this Indenture, unless and until
Definitive Notes shall have been issued to Note Owners pursuant to Section 2.11,
the Indenture Trustee shall give all such notices and communications specified
herein to be given to Noteholders to the Clearing Agency, and shall have no
obligation to the Note Owners.
SECTION 2.11 DEFINITIVE NOTES. If (i) (A) the Administrator advises the
Indenture Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities as described in the Depository
Agreement and (B) the Indenture Trustee or the Administrator is unable to locate
a qualified successor, (ii) the Administrator at its option advises the
Indenture Trustee in writing that it elects to terminate the book-entry system
through the Clearing Agency or (iii) after an Indenture Default, Note Owners
representing in the aggregate not less than a majority of the Outstanding Note
Amount, voting together as a single class, advise the Indenture Trustee through
the Clearing Agency and its Clearing Agency Participants in writing that the
continuation of a book-entry system through the Clearing Agency or its successor
is no longer in the best interest of Note Owners, the Indenture Trustee shall be
required to notify all Note Owners, through the Clearing Agency, of the
occurrence of such event and the availability through the Clearing Agency of
Definitive Notes to Note Owners requesting the same. Upon surrender to the
Indenture Trustee by the Clearing Agency of the Note or Notes representing the
Book-Entry Notes and the receipt of instructions for re-registration, the
Indenture Trustee shall issue Definitive Notes to Note Owners, who thereupon
shall become Noteholders for all purposes of this Indenture. None of the Issuer,
the Note Registrar or the Indenture Trustee shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions.
The Indenture Trustee shall not be liable if the Indenture Trustee or the
Administrator is unable to locate a qualified successor Clearing Agency. The
Definitive Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of such methods
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(with or without steel engraved borders), all as determined by the officers
executing such Notes, as evidenced by their execution of such Notes.
If Definitive Notes are issued and the Indenture Trustee is not the Note
Registrar, the Issuer shall furnish or cause to be furnished to the Indenture
Trustee a list of the names and addresses of the Noteholders (i) as of each
Record Date, within five days thereafter and (ii) as of not more than ten days
prior to the time such list is furnished, within 30 days after receipt by the
Issuer of a written request therefor.
SECTION 2.12 AUTHENTICATING AGENTS. Upon the request of the Issuer, the
Indenture Trustee shall, and if the Indenture Trustee so chooses the Indenture
Trustee may, appoint one or more Authenticating Agents with power to act on its
behalf and subject to its direction in the authentication of Notes in connection
with issuance, transfers and exchanges under Sections 2.2, 2.4, 2.5 and 9.5, as
fully to all intents and purposes as though each such Authenticating Agent had
been expressly authorized by such Sections to authenticate such Notes. For all
purposes of this Indenture, the authentication of Notes by an Authenticating
Agent pursuant to this Section shall be deemed to be the authentication of Notes
by the Indenture Trustee. The Indenture Trustee shall be the Authenticating
Agent in the absence of any appointment thereof.
Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of any Authenticating Agent, shall be the successor
of such Authenticating Agent hereunder, without the execution or filing of any
further act on the part of the parties hereto or such Authenticating Agent or
such successor corporation.
Any Authenticating Agent may at any time resign by giving written notice of
resignation to the Indenture Trustee and the Issuer. The Indenture Trustee may
at any time terminate the agency of any Authenticating Agent by giving written
notice of termination to such Authenticating Agent and the Issuer. Upon
receiving such notice of resignation or upon such termination, the Indenture
Trustee shall promptly appoint a successor Authenticating Agent and shall give
written notice of such appointment to the Issuer. The provisions of Sections 2.7
and 6.4 shall be applicable to any Authenticating Agent.
SECTION 2.13 TAX TREATMENT. The Issuer has entered into this Indenture, and
the Notes shall be issued, with the intention that, solely for federal, state
and local income, franchise and/or value added tax purposes, the Notes shall
qualify as indebtedness secured by the Collateral. The Issuer, by entering into
this Indenture, and each Noteholder, by its acceptance of a Note (and each Note
Owner by its acceptance of an interest in the applicable Book-Entry Note), agree
to treat the Notes for federal, state and local income, franchise and/or value
added tax purposes as indebtedness.
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ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The Issuer shall duly and
punctually pay the principal of and interest on the Notes in accordance with the
terms of the Notes and this Indenture. Amounts properly withheld under the Code
by any Person from a payment to any Noteholder of interest or principal shall be
considered to have been paid by the Issuer to such Noteholder for all purposes
of this Indenture. The final interest payment on each Class of Notes is due on
the earlier of (a) the Payment Date (including any Redemption Date) on which the
principal amount of that Class of Notes is reduced to zero or (b) the applicable
Final Scheduled Payment Date for that Class of Note.
SECTION 3.2 MAINTENANCE OF OFFICE OR AGENCY. The Note Registrar, on behalf
of the Issuer, shall maintain at the Corporate Trust Office or at such other
location in the Borough of Manhattan, The City of New York, chosen by the Note
Registrar, acting for the Issuer, an office or agency where Notes may be
surrendered for registration of transfer or exchange, and where notices to and
demands upon the Issuer in respect of the Notes and this Indenture may be
served. The Issuer hereby appoints the Indenture Trustee as its agent to receive
all such surrenders, notices and demands. The Issuer shall give prompt written
notice to the Indenture 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 Indenture
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
Indenture 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 Sections
8.4 and 5.4(b), all payments of amounts due and payable with respect to any
Notes that are to be made from amounts withdrawn from the Collection Account
shall be made on behalf of the Issuer by the Indenture Trustee or by another
Paying Agent, and no amounts so withdrawn therefrom for payments on Notes shall
be paid over to the Issuer except as provided in this Section.
On or prior to each Payment Date and Redemption Date, the Issuer shall
deposit or cause to be deposited into the Collection Account an aggregate sum
sufficient to pay the amounts then becoming due under the Notes, and the Paying
Agent shall hold such sum in trust for the benefit of the Persons entitled
thereto and (unless the Paying Agent is the Indenture Trustee) shall promptly
notify the Indenture Trustee of any failure by the Issuer to effect such
deposit.
The Issuer shall cause each Paying Agent other than the Indenture Trustee
to execute and deliver to the Indenture Trustee an instrument in which such
Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent, it hereby so agrees to the extent relevant),
subject to the provisions of this Section, that such Paying Agent shall:
(a) 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
9
Persons or otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(b) give the Indenture Trustee written notice of any default by the
Issuer of which it has actual knowledge (or any other obligor upon the Notes) in
the making of any payment required to be made with respect to the Notes;
(c) at any time during the continuance of any such default, upon the
written request of the Indenture Trustee, forthwith pay to the Indenture Trustee
all sums so held in trust by such Paying Agent;
(d) promptly resign as a Paying Agent and forthwith pay to the
Indenture 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
(e) 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 Indenture Trustee all sums held in trust by such
Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts
as those upon which such sums were held by such Paying Agent; and upon such
payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds, any money held
by the Indenture 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
distributed by the Indenture Trustee to the Issuer and the related Noteholder
shall thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof, and all liability of the Indenture Trustee or such Paying Agent
with respect to such trust money shall thereupon cease; provided, however, that
the Indenture Trustee or such Paying Agent, before being required to make any
such repayment, shall at the reasonable 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 date shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining shall be paid to
the Certificateholders. The Indenture Trustee shall also adopt and employ, at
the written direction of the Issuer and at the expense of the Issuer, any other
reasonable means of notification of such repayment (including mailing notice of
such repayment to Noteholders the Notes of which have been called but not
surrendered for redemption or whose right to or interest in monies due and
payable but not claimed is determinable from the records of the Indenture
Trustee or any Paying Agent at the last address of record for each such
Noteholder).
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SECTION 3.4 EXISTENCE. The Issuer shall keep in full effect its existence
and rights as a statutory trust under the laws of the State of Delaware.
SECTION 3.5 PROTECTION OF COLLATERAL. The Issuer intends the security
interest Granted pursuant to this Indenture in favor of the Indenture Trustee on
behalf of the Noteholders to be prior to all other liens in respect of the
Collateral, and the Issuer shall take all actions necessary to obtain and
maintain, for the benefit of the Indenture Trustee on behalf of the Noteholders,
a first lien on and a first priority, perfected security interest in the
Collateral. The Issuer shall from time to time execute and deliver all such
supplements and amendments hereto, shall file or authorize the filing of all
such financing statements, continuation statements, instruments of further
assurance and other instruments, all as prepared by the Administrator and
delivered to the Issuer, and shall take such other action necessary or advisable
to:
(a) Grant more effectively all or any portion of the Collateral;
(b) maintain or preserve the lien and security interest (and the
priority thereof) created by this Indenture or carry out more effectively the
purposes hereof;
(c) perfect, publish notice of or protect the validity of any Grant
made or to be made by this Indenture;
(d) enforce any of the Collateral;
(e) preserve and defend title to the Collateral and the rights of the
Indenture Trustee and the Noteholders in the Collateral against the claims of
all Persons; or
(f) pay or cause to be paid all taxes or assessments levied or
assessed upon the Collateral when due.
The Issuer hereby designates the Indenture Trustee as its agent and
attorney-in-fact and hereby authorizes the Indenture Trustee to file all
financing statements, continuation statements or other instruments required to
be executed (if any) pursuant to this Section. Notwithstanding anything to the
contrary contained herein (including the authorization to file granted in the
preceding sentence), the Indenture Trustee shall have no duty and shall not be
responsible for filing any financing or continuation statements or recording any
documents or instruments in any public office at any time or times or otherwise
perfecting or maintaining the perfection of any security interest.
SECTION 3.6 Opinions as to Collateral.
(a) On the Closing Date, the Issuer shall furnish or cause to be
furnished to the Indenture Trustee, an Opinion of Counsel to the effect that, in
the opinion of such counsel, either (i) all financing statements and
continuation statements have been duly filed that are necessary to create and
maintain the lien and first-priority security interest of the Indenture Trustee
in the Transaction SUBI Certificate and reciting the details of such action, or
(ii) no such action is necessary to create and maintain such lien and security
interest.
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(b) On or before April 30th of each calendar year, beginning with
April 30, [_____], the Issuer shall furnish to the Indenture Trustee an Opinion
of Counsel to the effect that in the opinion of such counsel, either (i) all
financing statements and continuation statements have been filed that are
necessary to continue the lien and security interest of the Indenture Trustee in
the Transaction SUBI Certificates and reciting the details of such filings or
referring to prior Opinions of Counsel in which such details are given, or (ii)
no such action is necessary to continue 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 [March 31] in
the following calendar year.
SECTION 3.7 PERFORMANCE OF OBLIGATIONS; ADMINISTRATION OF THE TRANSACTION
SUBI ASSETS.
(a) The Issuer shall not take any action and shall use its best
efforts not to permit any action to be taken by others, including the
Administrator, 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 paragraph (c)
below, the Transaction Documents or such other instrument or agreement.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer's Certificate of
the Issuer shall be deemed to be action taken by the Issuer. Initially, the
Issuer has contracted with the Administrator, and the Administrator has agreed,
to assist the Issuer in performing its duties under this Indenture.
(c) The Issuer shall, and, shall cause the Administrator and the
Servicer to agree to, punctually perform and observe all of its obligations and
agreements contained in this Indenture, the other Transaction Documents and the
instruments and agreements included in the Collateral, including 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 other Transaction
Documents in accordance with and within the time periods provided for herein and
therein. Except as otherwise expressly provided therein, the Issuer, as a party
to the Transaction Documents and as Holder of the Transaction SUBI Certificate,
shall not amend any Transaction Document to which it is a party or any provision
thereof other than in accordance with the amendment provisions set forth in such
Transaction Document.
SECTION 3.8 NEGATIVE COVENANTS. So long as any Notes are Outstanding, the
Issuer shall not:
(a) engage in any activities other than financing, acquiring, owning,
pledging and managing the Transaction SUBI Certificate and the other Collateral
as contemplated by this Indenture and the other Transaction Documents;
12
(b) except as expressly permitted herein or in the other Transaction
Documents, sell, transfer, exchange or otherwise dispose of any of the assets of
the Issuer;
(c) 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 applicable state law) 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;
(d) (i) permit the validity or effectiveness of this Indenture to be
impaired, permit the lien of this Indenture to be amended, hypothecated,
subordinated, terminated or discharged or permit any Person to be released from
any covenants or obligations under this Indenture, except as may be expressly
permitted hereby, (ii) permit any Adverse Claim (other than Permitted Liens) to
be created on or extend to or otherwise arise upon or burden the Trust Estate,
any part thereof or any interest therein or the proceeds thereof or (iii) except
as otherwise provided in the Transaction Documents, permit the lien of this
Indenture not to constitute a valid first priority (other than with respect to
any Permitted Lien) security interest in the Trust Estate;
(e) incur, assume or guarantee any indebtedness other than
indebtedness incurred in accordance with the Transaction Documents;
(f) except as otherwise permitted by the Transaction Documents,
dissolve or liquidate in whole or in part; or
(g) merge or consolidate with any other Person.
SECTION 3.9 ISSUER CERTIFICATES AND REPORTS.
(a) The Issuer shall deliver to the Indenture Trustee and each Rating
Agency, within [90] days after the end of each calendar year (commencing with
the year ending [__________]), an Officer's 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 its performance under this Indenture has been made under such
Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, 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.
(b) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after the
Issuer is required (if at all) to file the same with the Commission,
copies of the annual reports and such other information, documents and
reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe)
as the Issuer may be required to file with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act or such other reports required
pursuant to TIA Section 314(a)(1);
13
(ii) file with the Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from time to time by
the Commission such other information, documents and reports with
respect to compliance by the Issuer with the conditions and covenants
of this Indenture as may be required from time to time by such rules
and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture Trustee
shall transmit by mail to all Noteholders as required by TIA Section
313(c)) such summaries of any information, documents and reports
required to be filed by the Issuer pursuant to clauses (i) and (ii) of
this Section 3.9(b) as may be required pursuant to rules and
regulations prescribed from time to time by the Commission.
(c) Delivery of such reports, information and documents to the
Indenture Trustee is for informational purposes only and the Indenture Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Issuer's compliance with any of its covenants hereunder (as to which the
Indenture Trustee is entitled to rely exclusively on Officer's Certificates).
(d) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall be the same as the fiscal year of the Servicer.
SECTION 3.10 RESTRICTIONS ON CERTAIN OTHER ACTIVITIES. Except as otherwise
provided in the Transaction Documents, the Issuer shall not: (i) engage in any
activities other than financing, acquiring, owning, pledging and managing the
Transaction SUBI Certificate and the other Collateral in the manner contemplated
by the Transaction Documents; (ii) issue, incur, assume, guarantee or otherwise
become liable, directly or indirectly, for any indebtedness other than the
Notes; (iii) make any loan, advance or credit to, guarantee (directly or
indirectly or by an instrument having the effect of assuring 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, own, purchase,
repurchase or acquire (or agree contingently to do so) any stock, obligations,
assets or securities of, or any other interest in, or make any capital
contribution to, any other Person; or (iv) make any expenditure (by long-term or
operating lease or otherwise) for capital assets (either realty or personalty).
SECTION 3.11 NOTICE OF DEFAULTS. The Issuer agrees to give the Indenture
Trustee and each Rating Agency prompt written notice of each Indenture Default
hereunder.
SECTION 3.12 FURTHER INSTRUMENTS AND ACTS. Upon request of the Indenture
Trustee, the Issuer shall execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
SECTION 3.13 DELIVERY OF TRANSACTION SUBI CERTIFICATE. On the Closing Date,
the Issuer shall deliver or cause to be delivered to the Indenture Trustee as
security for its obligations hereunder, the Transaction SUBI Certificate. The
Indenture Trustee shall take possession of the Transaction SUBI Certificate in
New York and shall at all times during the period of this Indenture maintain
custody of the Transaction SUBI Certificate in New York.
14
SECTION 3.14 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
other Transaction Document.
SECTION 3.15 PERFECTION REPRESENTATIONS.
(a) The representations, warranties and covenants set forth in
Schedule I hereto shall be a part of this Indenture for all purposes.
(b) Notwithstanding any other provision of this Indenture or any other
Transaction Document, the perfection representations contained in Schedule I
hereto shall be continuing, and remain in full force and effect until such time
as all obligations under this Indenture have been finally and fully paid and
performed.
(c) The parties to this Indenture: (i) shall not waive any of the
perfection representations contained in Schedule I hereto; (ii) shall provide
the Rating Agencies with prompt written notice of any breach of perfection
representations contained in Schedule I hereto and (iii) shall not waive a
breach of any of the perfection representations contained in Schedule I hereto.
SECTION 3.16 '34 ACT FILINGS. The Issuer hereby authorizes the Servicer and
the Transferor, or either of them, to prepare, sign, certify and file any and
all reports, statements and information respecting the Issuer and/or the Notes
required to be filed pursuant to the Securities and Exchange Act of 1934, as
amended, and the rules and regulations thereunder.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture shall
discharge with respect to the Collateral securing the Notes except as to (a)
rights of registration of transfer and exchange, (b) substitution of mutilated,
destroyed, lost or stolen Notes, (c) rights of Noteholders to receive payments
of principal thereof and interest thereon, (d) Sections 3.3, 3.4, 3.5, 3.8,
3.10, 3.11 and 3.13, (e) the rights, obligations and immunities of the Indenture
Trustee hereunder (including the rights of the Indenture Trustee under Section
6.7 and the obligations of the Indenture Trustee under Section 4.2) and (f) the
rights of Noteholders as beneficiaries hereof with respect to the property so
deposited with the Indenture Trustee payable to all or any of them, and the
Indenture Trustee, on demand and at the expense and on behalf of the Issuer,
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture, when (i) either (A) all Notes theretofore authenticated and
delivered (other than (1) Notes that have been mutilated, destroyed, lost or
stolen and that have been replaced or paid as provided in Section 2.5 and (2)
Notes for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Issuer and thereafter paid to the Persons
entitled thereto or discharged from such trust, as provided in Section 3.3) have
been delivered to the Indenture Trustee for cancellation; or (B) all Notes not
theretofore delivered to the Indenture Trustee for cancellation (1) have become
due and payable, (2) will become due and payable on the applicable Final
15
Scheduled Payment Date within one year or (3) are to be called for redemption
within one year under arrangements satisfactory to the Indenture Trustee for the
giving of notice of redemption by the Indenture Trustee in the name, and at the
expense, of the Issuer, and the Issuer, in the case of clauses (1), (2) or (3)
above, has irrevocably deposited or caused to be irrevocably deposited with the
Indenture Trustee cash or direct obligations of or obligations guaranteed by the
United States (that will mature prior to the date such amounts are payable), in
trust for such purpose, in an amount sufficient to pay and discharge the entire
indebtedness on such Notes (including interest and any fees and expenses due and
payable to the Owner Trustee and the Indenture Trustee) not theretofore
delivered to the Indenture Trustee for cancellation, when due, to the applicable
Final Scheduled Payment Date for each Class, or to the Redemption Date (if Notes
shall have been called for redemption pursuant to Section 10.1), as the case may
be; (ii) the Issuer has paid or caused to be paid all other sums payable
hereunder by the Issuer; and (iii) the Issuer has delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel, each meeting the
applicable requirements of Section 11.1 and, subject to Section 11.2, each
stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with (and, in
the case of an Officer's Certificate, stating that the Rating Agency Condition
has been satisfied).
SECTION 4.2 APPLICATION OF TRUST MONEY. All monies deposited with the
Indenture Trustee pursuant to Section 4.1 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 Indenture Trustee
may determine, to the Noteholders of the particular Notes for the payment or
redemption of which such monies have been deposited with the Indenture Trustee
of all sums due and to become due thereon for principal and interest. Such
monies need not be segregated from other funds of the Indenture Trustee except
to the extent required herein or as required by law.
SECTION 4.3 REPAYMENT OF MONIES HELD BY PAYING AGENT. In connection with
the satisfaction and discharge of this Indenture with respect to the Notes, all
monies then held by any Paying Agent other than the Indenture Trustee under the
provisions of this Indenture with respect to such Notes shall, upon demand of
the Issuer, be paid to the Indenture Trustee to be held and applied according to
Section 3.3 and such Paying Agent shall thereupon be released from all further
liability with respect to such monies.
ARTICLE V
INDENTURE DEFAULT
SECTION 5.1 INDENTURE DEFAULTS. The occurrence and continuation of any one
of the following events (whatever the reason for such Indenture Default and
whether it shall be voluntary or involuntary or 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) shall constitute a
default under this Indenture (each, an "Indenture Default"):
(a) default in the payment of any interest on any Note when the same
becomes due, and such default shall continue for a period of 5 days or more;
16
(b) default in the payment of principal of any Note at the related
Final Scheduled Payment Date or the Redemption Date;
(c) 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, which
default or inaccuracy materially and adversely affects the interests of the
Noteholders, 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
60 days after there shall have been given, by registered or certified mail, to
the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee
by Noteholders representing at least a majority of the Outstanding Note Amount,
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;
(d) 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 90
consecutive days; or
(e) 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, the consent by the Issuer to
the appointment of 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, the making by the Issuer of any general
assignment for the benefit of creditors, 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;
provided, however, that a delay in or failure of performance referred to under
clauses (a), (b) or (c) above for a period of 150 days will not constitute an
Indenture Default if that delay or failure was caused by force majeure or other
similar occurrence.
The Issuer shall promptly deliver to the Indenture Trustee and each Rating
Agency written notice in the form of an Officer's Certificate of any Indenture
Default, its status and what action the Issuer is taking or proposes to take
with respect thereto.
Subject to the provisions herein relating to the duties of the Indenture
Trustee, if an Indenture Default occurs and is continuing, the Indenture Trustee
shall be under no obligation to exercise any of the rights or powers under this
Indenture at the request or direction of any Noteholder, if the Indenture
Trustee reasonably believes that it will not be adequately
17
indemnified against the costs, expenses and liabilities that might be incurred
by it in complying with such request. Subject to such provisions for
indemnification and certain limitations contained herein, Noteholders holding
not less than a majority of the Outstanding Note Amount, voting together as a
single class, shall have the right to direct the time, method and place of
conducting any proceeding or any remedy available to the Indenture Trustee or
exercising any trust power conferred on the Indenture Trustee, and Noteholders
holding not less than a majority of the Outstanding Note Amount, voting together
as a single class, may, in certain cases, waive any default with respect
thereto, except a default in the payment of principal or interest or a default
in respect of a covenant or provision of the Indenture that cannot be modified
or amended without the waiver or consent of all of the holders of the
Outstanding Notes.
SECTION 5.2 ACCELERATION OF MATURITY; WAIVER OF INDENTURE DEFAULT. If an
Indenture Default should occur and be continuing, the Indenture Trustee or
Noteholders representing a majority of the Outstanding Note Amount, voting
together as a single class, may declare the principal of the Notes to be
immediately due and payable. Upon such declaration, the Indenture Trustee shall
promptly provide written notice to each Rating Agency. Such declaration may be
rescinded by Noteholders holding a majority of the Outstanding Note Amount,
voting together as a single class before a judgment or decree for payment of the
amount due has been obtained by the Indenture Trustee if (a) the Issuer has
deposited with the Indenture Trustee an amount sufficient to pay (i) all
interest on and principal of the Notes as if the Indenture Default giving rise
to such declaration had not occurred and (ii) all reasonable amounts previously
advanced by the Indenture Trustee and its reasonable costs and expenses and (b)
all Indenture Defaults (other than the nonpayment of principal of the Notes that
has become due solely by such acceleration) have been cured or waived.
At any time prior to the declaration of the acceleration of the maturity of
the Notes, Noteholders holding not less than a majority of the Outstanding Note
Amount, voting together as a single class, by written notice to the Issuer and
the Indenture Trustee, may waive such Indenture Default and its consequences,
except a default (i) in payment of principal of or interest on the Notes or (ii)
in respect of any covenant or provision in this Indenture that cannot be
modified or amended without the unanimous consent of the Noteholders. No such
waiver shall affect any subsequent default or impair any right consequent
thereto.
If the Notes have been declared due and payable following an Indenture
Default, the Indenture Trustee may institute proceedings to collect amounts due,
exercise remedies as a secured party (including foreclosure or sale of the Trust
Estate) or elect to maintain the Trust Estate and continue to apply the proceeds
from the Trust Estate as if there had been no declaration of acceleration. Any
sale of the Trust Estate by the Indenture Trustee will be subject to the terms
and conditions of Section 5.4.
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
INDENTURE TRUSTEE.
(a) The Issuer covenants that if there is a default in the payment of
(i) any interest on the Notes when the same becomes due, and such default
continues for a period of five days or (ii) the principal of the Notes at the
related Final Scheduled Payment or the Redemption Date, the Issuer shall, upon
demand of the Indenture Trustee in writing as directed by
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Noteholders holding not less than a majority of the Outstanding Note Amount, pay
to the Indenture Trustee, for the benefit of such Noteholders, the entire amount
then due and payable on such Notes for principal and interest, with interest on
the overdue principal, and, to the extent payment at such rate of interest shall
be legally enforceable, upon overdue installments of interest, at the applicable
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 Indenture
Trustee and its agents, attorneys and counsel.
(b) In case the Issuer shall fail forthwith to pay amounts described
in Section 5.3(a) upon demand, the Indenture Trustee, in its own name and as
trustee of an express trust, may institute a Proceeding for the collection of
the sums so due and unpaid, and may prosecute such Proceeding to judgment or
final decree, and may enforce the same against the Issuer or other obligor upon
such Notes and collect in the manner provided by law out of the property of the
Issuer or other obligor upon such Notes, wherever situated, the monies adjudged
or decreed to be payable.
(c) If an Indenture Default occurs and is continuing, the Indenture
Trustee may, in its discretion, proceed to protect and enforce its rights and
the rights of the Noteholders, by such appropriate Proceedings as the Indenture
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 Indenture
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 property of
the Issuer or such other obligor, the Indenture 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 Indenture 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 and interest 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 Indenture Trustee (including any
claim for reasonable compensation to the Indenture Trustee and each
predecessor Indenture Trustee, and their respective agents, attorneys
and counsel, and for reimbursement of all expenses and liabilities
incurred, and all advances and disbursements made, by the Indenture
Trustee and each predecessor Indenture Trustee, except as a result of
negligence or bad faith) and of the Noteholders allowed in such
Proceedings;
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(ii) unless prohibited by applicable law and regulations, to vote
on behalf of the Noteholders in any election of a trustee, a standby
trustee or Person performing similar functions in any such
Proceedings; to collect and receive any monies 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 the
Indenture Trustee on their behalf; and
(iii) 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
Indenture Trustee or the Noteholders 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
Noteholder to make payments to the Indenture Trustee and, in the event
the Indenture Trustee shall consent to the making of payments directly
to such Noteholders, to pay to the Indenture Trustee such amounts as
shall be sufficient to cover reasonable compensation to the Indenture
Trustee, each predecessor Indenture Trustee and their respective
agents, attorneys and counsel, and all other expenses and liabilities
incurred and all advances and disbursements made by the Indenture
Trustee and each predecessor Indenture Trustee except as a result of
negligence or bad faith, and any other amounts due the Indenture
Trustee under Section 6.7.
(e) Nothing herein contained shall be deemed to authorize the
Indenture 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 Noteholder or 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 the Notes, may be enforced by the Indenture Trustee without the
possession of the Notes or the production thereof in any trial or other
Proceedings relative thereto, and any such action or Proceedings instituted by
the Indenture 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,
advances, disbursements and compensation of the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents, attorneys and counsel
shall be for the ratable benefit of the Noteholders in respect of which such
judgment has been recovered.
(g) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Noteholders, and it shall not be necessary to make any
Noteholder a party to any such Proceedings.
SECTION 5.4 REMEDIES; PRIORITIES.
(a) If an Indenture Default shall have occurred and be continuing, the
Indenture Trustee may do one or more of the following (subject to Sections 5.2
and 5.5):
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(i) institute Proceedings in its own name and as 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 monies 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
take any other appropriate action to protect and enforce the rights
and remedies of the Indenture Trustee and the Noteholders; and
(iv) subject to Section 5.17, after an acceleration of the
maturity of the Notes pursuant to Section 5.2, 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 the Indenture Trustee may not sell or otherwise
liquidate the Trust Estate following an Indenture Default, unless (A) the
Transferor elects to exercise its rights to purchase the Transaction SUBI
Certificate pursuant to Section 9.4 of the Trust Agreement, (B) Noteholders
holding 100% of the Outstanding Note Amount consent thereto, (C) the proceeds of
such sale are sufficient to discharge in full all amounts then due and unpaid
upon all Outstanding Notes or (D) there has been an Indenture Default described
in Section 5.1(a) or (b) and the Indenture 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 Indenture Trustee obtains
the consent of Noteholders holding not less than 66-2/3% of the Outstanding Note
Amount, voting together as a single class; provided, further, that the Indenture
Trustee may not sell the Trust Estate unless it shall first have obtained an
Opinion of Counsel (at the expense of the Issuer) that such sale will not cause
the Origination Trust or an interest therein or portion thereof or the Issuer to
be classified as an association or a publicly traded partnership taxable as a
corporation for federal income tax purposes. In determining such sufficiency or
insufficiency with respect to clauses (B) and (C) of the preceding sentence, the
Indenture Trustee may but need not obtain (at the expense of the Issuer) 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.
(b) If the Indenture Trustee collects any money or property pursuant
to this Article upon sale of the Trust Estate, it shall pay out such money or
property held as Collateral (including available monies on deposit in the
Reserve Account) and deposited in the Collection Account in accordance with the
following priorities:
(i) to the Indenture Trustee, the SUBI Trustee and the Owner
Trustee, for any accrued and unpaid fees, expenses and indemnity
payments pursuant to the terms of this Indenture, the Origination
Trust Agreement or the Trust Agreement, as applicable; provided that
aggregate expenses payable to the
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Indenture Trustee, the SUBI Trustee and the Owner Trustee pursuant to
this clause (i) shall be limited to $100,000 per annum in the
aggregate;
(ii) to the Servicer (or any predecessor Servicer, if
applicable), for reimbursement of all outstanding Advances;
(iii) pro rata, to the Servicer, the Servicing Fee, together with
any unpaid Servicing Fees in respect of one or more prior Collection
Periods, and to the Administrator, the Administration Fee, together
with any unpaid Administration Fees in respect of one or more prior
Collections Periods;
(iv) to the Noteholders, an amount equal to the Accrued Note
Interest;
(v) to the Holders of the Class A-1 Notes, in respect of
principal thereof until the Class A-1 Notes have been paid in full;
(vi) to the Holders of the Class A-2 Notes, the Class A-3 Notes
and the Class A-4 Notes, in respect of principal thereof, on a pro
rata basis (based on the Outstanding Note Amount of each Class on such
Payment Date), until all such Classes of the Notes have been paid in
full;
(vii) to the Indenture Trustee, the SUBI Trustee and the Owner
Trustee, for any accrued and unpaid fees, expenses and indemnity
payments; and
(viii) any remaining funds shall be distributed to or at the
direction of the Certificateholder.
(c) The Indenture 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 Indenture
Trustee a notice that states the record date, the payment date and the amount to
be paid.
SECTION 5.5 OPTIONAL PRESERVATION OF THE TRANSACTION SUBI ASSETS. If the
Notes have been declared to be due and payable under Section 5.2 following an
Indenture Default and such declaration and its consequences have not been
rescinded and annulled, the Indenture Trustee may, unless directed to sell
pursuant to Section 9.4 of the Trust Agreement, but need not, elect to maintain
possession of the Trust Estate and continue to apply the proceeds thereof in
accordance with Section 3.1 and 8.4. It is the intent 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 Indenture Trustee shall take
such intent 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 Indenture Trustee may but need not obtain (at the expense of the
Issuer) 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 LIMITATION OF SUITS.
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(a) 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 Noteholder previously has given to the Indenture Trustee written notice
of a continuing Indenture Default, (ii) Noteholders holding not less than 25% of
the Outstanding Note Amount have made written request to the Indenture Trustee
to institute such Proceeding in respect of such Indenture Default in its own
name as Indenture Trustee, (iii) such Noteholder has offered the Indenture
Trustee reasonable indemnity against the costs, expenses and liabilities to be
incurred in complying with such request, (iv) the Indenture Trustee has for 60
days failed to institute such Proceedings and (v) no direction inconsistent with
such written request has been given to the Indenture Trustee during such 60 day
period by Noteholders holding a majority of the Outstanding Note Amount.
No Noteholder or group of Noteholders 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 Noteholders or to obtain or
to seek to obtain priority or preference over any other Noteholder or to enforce
any right under this Indenture, except in the manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Noteholders, each
representing less than a majority of the Outstanding Note Amount, the Indenture
Trustee in its sole discretion may determine what action, if any, shall be
taken, notwithstanding any other provisions of this Indenture.
(b) No Noteholder shall have any right to vote except as provided
pursuant to this Indenture and the Notes, nor any right in any manner to
otherwise control the operation and management of the Issuer. However, in
connection with any action as to which Noteholders are entitled to vote or
consent under this Indenture and the Notes, the Issuer may set a record date for
purposes of determining the identity of Noteholders entitled to vote or consent
in accordance with TIA Section 316(c).
SECTION 5.7 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL AND
INTEREST. Notwithstanding any other provision in this Indenture, any Noteholder
shall have the right, which is absolute and unconditional, to receive payment of
the principal of and interest on, if any, such Note on or after the respective
due dates thereof expressed in such Note or 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 in accordance with Section 5.6, and such right
shall not be impaired without the consent of such Noteholder.
SECTION 5.8 RESTORATION OF RIGHTS AND REMEDIES. If the Indenture Trustee 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 Indenture Trustee or such
Noteholder, then and in every such case the Issuer, the Indenture 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 Indenture Trustee and the Noteholders
shall continue as though no such Proceeding had been instituted.
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SECTION 5.9 RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or 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, 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 5.10 DELAY OR OMISSION NOT A WAIVER. No delay or omission of the
Indenture Trustee or any Noteholder to exercise any right or remedy accruing
upon any Default or Indenture Default shall impair any such right or remedy or
constitute a waiver of any such Default or Indenture Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Indenture
Trustee or the Noteholders may be exercised from time to time, and as often as
may be deemed expedient, by the Indenture Trustee or by the Noteholders, as the
case may be.
SECTION 5.11 CONTROL BY NOTEHOLDERS. Subject to the provisions of Sections
5.6, 6.2(d) and 6.2(e), Noteholders holding not less than a majority of the
Outstanding Note Amount shall have the right to direct the time, method and
place of conducting any Proceeding for any remedy available to the Indenture
Trustee with respect to the Notes or with respect to the exercise of any trust
or power conferred on the Indenture Trustee, provided that:
(a) such direction shall not be in conflict with any rule of law or
this Indenture;
(b) subject to Section 5.4, any direction to the Indenture Trustee to
sell or liquidate the Trust Estate shall be made by Noteholders holding not less
than 100% of the Outstanding Note Amount;
(c) if the conditions set forth in Section 5.5 have been satisfied and
the Indenture Trustee elects to retain the Trust Estate pursuant to such
Section, and except in the case of a sale of the Trust Estate pursuant to
Section 9.2 of the Trust Agreement, then any direction to the Indenture Trustee
by Noteholders holding less than 100% of the Outstanding Note Amount to sell or
liquidate the Trust Estate shall be of no force and effect; and
(d) the Indenture Trustee may take any other action deemed proper by
the Indenture Trustee that is not inconsistent with such direction.
Notwithstanding the rights of Noteholders set forth in this Section,
subject to Section 6.1, the Indenture Trustee need not take any action it
determines might expose it to personal liability or might materially adversely
affect or unduly prejudice the rights of any Noteholders not consenting to such
action.
SECTION 5.12 WAIVER OF PAST DEFAULTS. Prior to the acceleration of the
maturity of the Notes as provided in Section 5.2, Noteholders holding not less
than a majority of the Outstanding Note Amount may waive any past Indenture
Default and its consequences except an Indenture Default (i) in payment of
principal of or interest on the Notes or (ii) in respect of a covenant or
provision hereof that cannot be modified or amended without the consent of each
Noteholder. In
24
the case of any such waiver, the Issuer, the Indenture Trustee and the
Noteholders shall be restored to their former positions and rights hereunder,
respectively, but no such waiver shall extend to any subsequent or other
Indenture Default or impair any right consequent thereto.
Upon any such waiver, such Indenture Default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Indenture 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 Indenture Default or impair any right consequent thereto.
SECTION 5.13 UNDERTAKING FOR COSTS. All parties to this Indenture agree,
and each Noteholder by such Noteholder'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 Indenture Trustee for any action taken, suffered or omitted by it as
Indenture 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 (i) any suit instituted by the
Indenture Trustee, (ii) any suit instituted by any Noteholder or group of
Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Note Amount or (iii) any suit instituted by any Noteholder for the
enforcement of the payment of principal of or interest on any Note on or after
the related due dates expressed in such Note and in this Indenture (or, in the
case of redemption, on or after the Redemption Date).
SECTION 5.14 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 advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Indenture
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
SECTION 5.15 ACTION ON NOTES. The Indenture 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 Indenture Trustee or the Noteholders shall be impaired by the recovery of
any judgment by the Indenture 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. Any money or property collected by the Indenture
Trustee shall be applied in accordance with Section 5.4(b).
SECTION 5.16 PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS.
(a) Promptly following a request from the Indenture Trustee to do so,
the Issuer shall take all such lawful action as the Indenture Trustee may
request to compel or secure
25
the performance and observance by the Servicer of its obligations to the Issuer
under or in connection with the Servicing Agreement and the Transaction SUBI
Servicing Supplement, 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 each such agreement to the extent and in the manner
directed by the Indenture Trustee, including the transmission of notices of
default on the part of the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Servicer of its obligations under the Servicing Agreement.
(b) If an Indenture Default has occurred and is continuing, the
Indenture Trustee may, and at the direction (which direction shall be in
writing) of Noteholders holding not less than a majority of the Outstanding Note
Amount, shall, exercise all rights, remedies, powers, privileges and claims of
the Issuer against the Transferor and the Servicer under or in connection with
the Servicing Agreement or any other Transaction Document, including the right
or power to take any action to compel or secure performance or observance by the
Servicer of its obligations to the Issuer thereunder and to give any consent,
request, notice, direction, approval, extension or waiver under such Transaction
Document, and any right of the Issuer to take such action shall be suspended.
SECTION 5.17 SALE OF COLLATERAL. If the Indenture Trustee acts to sell the
Collateral or any part thereof, pursuant to Section 5.4(a), the Indenture
Trustee shall publish a notice in an Authorized Newspaper stating that the
Indenture Trustee intends to effect such a sale in a commercially reasonable
manner and on commercially reasonable terms, which shall include the
solicitation of competitive bids. Following such publication, the Indenture
Trustee shall, unless otherwise prohibited by applicable law from any such
action, sell the Collateral or any part thereof, in such manner and on such
terms as provided above to the highest bidder, provided, however, that the
Indenture Trustee may from time to time postpone any sale by public announcement
made at the time and place of such sale. The Indenture Trustee shall give notice
to the Transferor and Servicer of any proposed sale, and the Transferor, the
Servicer or any Affiliate thereof shall be permitted to bid for the Collateral
at any such sale. The Indenture Trustee may obtain a prior determination from a
conservator, receiver or trustee in bankruptcy of the Issuer that the terms and
manner of any proposed sale are commercially reasonable. The power to effect any
sale of any portion of the Collateral pursuant to Section 5.4 and this Section
5.17 shall not be exhausted by any one or more sales as to any portion of the
Collateral remaining unsold, but shall continue unimpaired until the entire
Collateral shall have been sold or all amounts payable on the Notes shall have
been paid.
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ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1 DUTIES OF INDENTURE TRUSTEE.
(a) If an Indenture Default has occurred and is continuing, the
Indenture 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 Indenture Default:
(i) the Indenture 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 Indenture Trustee; and
(ii) the Indenture Trustee may conclusively rely in good faith on
its part, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to
the Indenture Trustee and conforming to the requirements of this
Indenture; but in the case of any such certificates or opinions which
by any provision hereof are specifically required to be furnished to
the Indenture Trustee, the Indenture Trustee shall examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Indenture (but need not confirm or
investigate the accuracy of mathematical calculations or other facts
stated therein).
(c) The Indenture Trustee shall not be relieved from liability for its
own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section 6.1;
(ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is
proved that the Indenture Trustee was negligent in ascertaining the
pertinent facts; and
(iii) the Indenture 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 Section 5.11.
(d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to paragraphs (a), (b) and (c) of this Section 6.1.
(e) The Indenture Trustee shall not be liable for interest on any
money received by it except as the Indenture Trustee may agree in writing with
the Issuer.
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(f) Money held in trust by the Indenture Trustee need not be
segregated from other funds of the Indenture Trustee except to the extent
required by law or the terms of this Indenture or any other Transaction Document
to which the Indenture Trustee is a party.
(g) No provision of this Indenture shall require the Indenture 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 indemnity reasonably satisfactory to it 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 Indenture Trustee
shall be subject to the provisions of this Section.
(i) The Indenture Trustee shall not be deemed to have knowledge of any
Indenture Default or other event unless a Responsible Officer has actual
knowledge thereof or has received written notice thereof in accordance with the
provisions of this Indenture or any other Transaction Document.
(j) Nothing contained herein shall be deemed to authorize the
Indenture Trustee to engage in any business operations or any activities other
than those set forth in this Indenture. Specifically, the Indenture Trustee
shall have no authority to engage in any business operations, acquire any assets
other than those specifically included in the Trust Estate under this Indenture
or otherwise vary the assets held by the Issuer. Similarly, the Indenture
Trustee shall have no discretionary duties other than performing those
ministerial acts set forth above necessary to accomplish the purpose of the
Issuer as set forth in this Indenture.
SECTION 6.2 RIGHTS OF INDENTURE TRUSTEE.
(a) The Indenture Trustee may conclusively rely and shall be protected
in acting upon or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order, note,
direction, demand, election or other paper or document reasonably believed by it
to be genuine and to have been signed or presented by the proper person. The
Indenture Trustee need not investigate any fact or matter stated in the
document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate (with respect to factual matters) or an Opinion
of Counsel, as applicable. The Indenture Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on such Officer's
Certificate or Opinion of Counsel.
(c) The Indenture 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 Indenture Trustee shall
not be responsible for any misconduct or negligence on the part of, or for the
supervision of, the Administrator, any co-trustee or separate trustee appointed
in accordance with the provisions of Section 6.10 or any other such agent,
attorney, custodian or nominee appointed with due care by it hereunder.
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(d) The Indenture Trustee shall not be liable for any action it takes
or omits to take in good faith that it believes to be authorized or within its
rights or powers; provided, however, that the Indenture Trustee's conduct does
not constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice of
such counsel or any 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 Indenture Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture or to institute, conduct
or defend any litigation under this Indenture or in relation to this Indenture
or to honor the request or direction of any of the Noteholders pursuant to this
Indenture unless such Noteholders shall have offered to the Indenture Trustee
reasonable security or indemnity satisfactory to the Indenture Trustee against
the reasonable costs, expenses, disbursements, advances and liabilities that
might be incurred by it, its agents and its counsel in compliance with such
request or direction.
(g) The Indenture 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 holders of
Notes evidencing not less than a majority of the Outstanding Note Amount;
provided, however, that if the payment within a reasonable time to the Indenture
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 Indenture Trustee, not
reasonably assured to the Indenture Trustee by the security afforded to it by
the terms of this Indenture, the Indenture Trustee may require reasonable
indemnity against such cost, expense or liability as a condition to so
proceeding. The reasonable expense of each such investigation shall be paid by
the Person making such request, or, if paid by the Indenture Trustee, shall be
reimbursed by the Person making such request upon demand.
(h) Any request or direction of the Issuer mentioned herein shall be
sufficiently evidenced by an Issuer Request.
SECTION 6.3 INDIVIDUAL RIGHTS OF INDENTURE TRUSTEE. Subject to Section 310
of the TIA, the Indenture Trustee in its individual or any other capacity may
become the owner or pledgee of Notes. The Indenture Trustee may deal with the
Transferor, the Owner Trustee, the Administrator and their respective Affiliates
in banking transactions with the same rights it would have if it were not
Indenture Trustee, and the Transferor, the Owner Trustee, the Administrator and
their respective Affiliates may maintain normal commercial banking relationships
with the Indenture Trustee and its Affiliates. Any Paying Agent, Note Registrar,
co-registrar, co-paying agent, co-trustee or separate trustee may do the same
with like rights. The Indenture Trustee must, however, comply with Section 6.11.
SECTION 6.4 INDENTURE TRUSTEE'S DISCLAIMER. The Indenture Trustee shall not
be responsible for and makes no representation as to the validity or adequacy of
this Indenture, the
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Trust Estate or the Notes, shall not be accountable for the Issuer's use of the
proceeds from the Notes and shall not be responsible for any statement in this
Indenture or in any document issued in connection with the sale of the Notes or
in the Notes, all of which shall be taken as the statements of the Issuer, other
than the Indenture Trustee's certificate of authentication.
SECTION 6.5 NOTICE OF DEFAULTS. If an Indenture Default occurs and is
continuing, and if it is known to a Responsible Officer of the Indenture
Trustee, the Indenture Trustee shall mail to each Noteholder and each Rating
Agency notice of such Indenture Default within 90 days after it occurs. Except
in the case of an Indenture Default with respect to payment of principal of or
interest on any Note (including payments pursuant to the redemption of Notes),
the Indenture Trustee may withhold such notice if and so long as a Responsible
Officer in good faith determines that withholding such notice is in the
interests of the Noteholders.
SECTION 6.6 REPORTS BY INDENTURE TRUSTEE TO NOTEHOLDERS. The Indenture
Trustee, at the expense of the Issuer, shall deliver to each Noteholder, not
later than the latest date permitted by law, such information as may be
reasonably requested (and reasonably available to the Indenture Trustee) to
enable such holder to prepare its federal and state income tax returns.
SECTION 6.7 COMPENSATION AND INDEMNITY. The Issuer shall cause the
Administrator to agree to (i) pay to the Indenture Trustee from time to time
such compensation as the Issuer, the Administrator and the Indenture Trustee
shall from time to time agree in writing for services rendered by the Indenture
Trustee hereunder in accordance with a fee letter between the Administrator and
the Indenture Trustee, (ii) reimburse the Indenture Trustee for all reasonable
expenses, advances and disbursements reasonably incurred by it in connection
with the performance of its duties as Indenture Trustee and (iii) indemnify the
Indenture Trustee for, and hold it harmless against, any and all loss, liability
or expense (including reasonable attorneys' fees) incurred by it in connection
with the administration of the Issuer or the performance of its duties as
Indenture Trustee. The Indenture Trustee's compensation shall not be limited by
any law on compensation of a trustee of an express trust. The Indenture Trustee
shall notify the Issuer and the Administrator promptly of any claim for which it
may seek indemnity. Failure by the Indenture Trustee to so notify the Issuer and
the Administrator shall not relieve the Issuer or the Administrator of its
obligations hereunder. The Issuer shall, or shall cause the Administrator to
agree to, defend any such claim, and the Indenture Trustee may have separate
counsel and the Issuer shall, or shall cause the Administrator to agree to, pay
the fees and expenses of such counsel. The Indenture Trustee shall not be
indemnified by the Administrator, the Issuer, the Transferor or the Servicer
against any loss, liability or expense incurred by it through its own willful
misconduct, negligence or bad faith, except that the Indenture Trustee shall not
be liable (i) for any error of judgment made by it in good faith unless it is
proved that the Indenture Trustee was negligent in ascertaining the pertinent
facts, (ii) with respect to any action it takes or omits to take in good faith
in accordance with a direction received by it from the Noteholders in accordance
with the terms of this Indenture and (iii) for interest on any money received by
it except as the Indenture Trustee and the Issuer may agree in writing.
The compensation and indemnity obligations to the Indenture Trustee
pursuant to this Section shall survive the discharge of this Indenture. When the
Indenture Trustee incurs expenses after the occurrence of a Default set forth in
Section 5.1(e) with respect to the Issuer,
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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.
SECTION 6.8 REMOVAL, RESIGNATION AND REPLACEMENT OF INDENTURE TRUSTEE. The
Indenture Trustee may resign at any time by so notifying the Issuer, the
Servicer, the Administrator and each Rating Agency. The Noteholders holding at
least a majority of the Outstanding Note Amount may remove the Indenture Trustee
without cause by so notifying the Indenture Trustee, the Servicer and the
Issuer, and following that removal may appoint a successor Indenture Trustee.
The Issuer shall remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) a court having jurisdiction in the premises in respect of
the Indenture 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 Indenture Trustee or for any substantial part of the Indenture
Trustee's property, or ordering the winding-up or liquidation of the
Indenture Trustee's affairs, provided any such decree or order shall
have continued unstayed and in effect for a period of 30 consecutive
days;
(iii) the Indenture 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
Indenture Trustee or for any substantial part of the Indenture
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;
or
(iv) the Indenture Trustee otherwise becomes incapable of acting.
Upon the resignation or required removal of the Indenture Trustee, or the
failure of the Noteholders to appoint a successor Indenture Trustee following
the removal without cause of the Indenture Trustee (the Indenture Trustee in any
such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall be required promptly to appoint a successor Indenture Trustee. Any
successor Indenture Trustee must at all times have a combined capital and
surplus of at least $50,000,000, a long-term debt rating of "A" or better by or
is otherwise acceptable to, each Rating Agency and satisfy the requirements of
Section 310(a) of the TIA. Additionally, prior to the appointment of any
successor Indenture Trustee, the Rating Agency Condition must be satisfied with
respect to such successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer. Thereupon the
resignation or removal of the retiring
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Indenture Trustee shall become effective and the successor Indenture Trustee,
without any further act, deed or conveyance, shall have all the rights, powers
and duties of the Indenture Trustee under this Indenture, subject to
satisfaction of the Rating Agency Condition. The successor Indenture Trustee
shall mail a notice of its succession to Noteholders. The retiring Indenture
Trustee shall promptly transfer all property held by it as Indenture Trustee to
the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 45 days after
the retiring Indenture Trustee resigns or is removed, the retiring Indenture
Trustee, the Issuer or Noteholders holding not less than a majority of the
Outstanding Note Amount may petition any court of competent jurisdiction (at the
expense of the Issuer) for the appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any Noteholder
may petition any court of competent jurisdiction for the removal of the
Indenture Trustee and the appointment of a successor Indenture Trustee.
Any resignation or removal of the Indenture Trustee and appointment of a
successor Indenture Trustee pursuant to any of the provisions of this Section
shall not become effective until acceptance of appointment by the successor
Indenture Trustee pursuant to this Section and payment of all fees and expenses
owed to the outgoing Indenture Trustee. Notwithstanding the replacement of the
Indenture Trustee pursuant to this Section, the retiring Indenture 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 INDENTURE TRUSTEE BY MERGER. If the Indenture Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to another corporation or depository
institution the resulting, surviving or transferee corporation, without any
further act, shall be the successor Indenture Trustee; provided, that such
corporation or depository institution shall be otherwise qualified and eligible
under Section 6.11. The Indenture Trustee shall provide each Rating Agency prior
written notice of any such transaction.
In case at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture, the Notes shall have been authenticated but not delivered, any
such successor to the Indenture 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 Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee.
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 Estate may at the time be located, the Indenture
Trustee and the Administrator acting jointly shall have the power and may
execute and deliver all instruments to appoint one or more Persons to
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act as a co-trustee or co-trustees, or separate trustee or separate trustees, of
all or any part of the Collateral, and to vest in such Person or Persons, in
such capacity and for the benefit of the Noteholders, such title to the Trust
Estate or any part hereof and, subject to the other provisions of this Section,
such powers, duties, obligations, rights and trusts as the Indenture Trustee and
the Administrator may consider necessary or desirable. If the Administrator
shall not have joined in such appointment within 15 days after it received a
request that it so join, the Indenture Trustee alone shall have the power to
make 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.
(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 Indenture Trustee shall be conferred or imposed upon
and exercised or performed by the Indenture Trustee and such separate
trustee or co-trustee jointly (it being intended that such separate
trustee or co-trustee is not authorized to act separately without the
Indenture 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 Indenture 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
Collateral 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 Indenture Trustee;
(ii) no separate trustee or co-trustee hereunder shall be
personally liable by reason of any act or omission of any other
trustee hereunder; and
(iii) the Indenture Trustee and the Administrator 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 Indenture
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. 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 Indenture
Trustee or separately, as may be provided therein, subject to all the provisions
of this Indenture and specifically including every provision of this Indenture
relating to the conduct of, affecting the liability of or affording protection
to the Indenture Trustee. Every such instrument shall be filed with the
Indenture Trustee and a copy thereof given to the Administrator.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture 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,
33
then all of its estates, properties, rights, remedies and trusts shall vest in
and be exercised by the Indenture Trustee to the extent permitted by law,
without the appointment of a new or successor trustee. Notwithstanding anything
to the contrary in this Indenture, the appointment of any separate trustee or
co-trustee shall not relieve the Indenture Trustee of its obligations and duties
under this Indenture.
SECTION 6.11 ELIGIBILITY; DISQUALIFICATION. The Indenture Trustee shall at
all times satisfy the requirements of Section 310(a) of the TIA and shall in
addition 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 a long-term
debt rating of "A" or better by, or be otherwise acceptable to, each Rating
Agency. The Indenture Trustee shall also satisfy the requirements of Section
310(b) of the TIA. The Transferor, the Administrator, the Servicer and their
respective Affiliates may maintain normal commercial banking relationships with
the Indenture Trustee and its Affiliates, but neither the Issuer nor any
Affiliate of the Issuer may serve as Indenture Trustee.
SECTION 6.12 TRUSTEE AS HOLDER OF TRANSACTION SUBI CERTIFICATE. Following
the occurrence and continuation of an Indenture Default, to the extent that the
Issuer has rights as a Holder of the Transaction SUBI Certificate, including
rights to distributions and notice, or is entitled to consent to any actions
taken by the Transferor, the Issuer may initiate such action or grant such
consent only with consent of the Indenture Trustee at the direction of the
Noteholders of not less than a majority of the Outstanding Note Amount.
Following the occurrence and continuation of an Indenture Default, the Indenture
Trustee shall exercise rights as a Holder of the Transaction SUBI Certificate or
the right to consent or withhold consent with respect to actions taken by the
Transferor or the Issuer, upon the written direction of holders of a majority of
the Outstanding Note Amount; provided, however, that any direction to the
Indenture Trustee to remove or replace the Servicer upon a Servicer Default
shall be made by Noteholders holding not less than 66-2/3% of the Outstanding
Note Amount.
SECTION 6.13 REPRESENTATIONS AND WARRANTIES OF INDENTURE TRUSTEE. The
Indenture Trustee hereby makes the following representations and warranties on
which the Issuer and Noteholders shall rely:
(i) the Indenture Trustee is a [national banking association duly
organized, validly existing and in good standing under the laws of the
United States of America]; and
(ii) the Indenture Trustee has full power, authority and legal
right to execute, deliver, and perform this Indenture and shall have
taken all necessary action to authorize the execution, delivery and
performance by it of this Indenture.
SECTION 6.14 FURNISHING OF DOCUMENTS. The Indenture Trustee shall furnish
to any Noteholder promptly upon receipt of a written request by such Noteholder
(at the expense of the requesting Noteholder) therefor, duplicates or copies of
all reports, notices, requests, demands, certificates and any other instruments
furnished to the Indenture Trustee under the Transaction Documents.
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SECTION 6.15 PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE ISSUER. The
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). Any Indenture Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated therein.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 ISSUER TO FURNISH INDENTURE TRUSTEE NOTEHOLDER NAMES AND
ADDRESSES. The Issuer shall furnish or cause to be furnished to the Indenture
Trustee (i) not more than five days after each Record Date a list, in such form
as the Indenture Trustee may reasonably require, of the names and addresses of
the Noteholders as of such Record Date and (ii) at such other times as the
Indenture 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 ten days prior to the time such list is furnished; provided, however,
that so long as the Indenture Trustee is the Note Registrar or the Notes are
issued as Book-Entry Notes, no such list shall be required to be furnished to
the Indenture Trustee.
SECTION 7.2 PRESERVATION OF INFORMATION; COMMUNICATIONS TO NOTEHOLDERS.
(a) The Indenture Trustee shall preserve in as current a form as is
reasonably practicable the names and addresses of the Noteholders contained in
the most recent list furnished to the Indenture Trustee as provided in Section
7.1 and the names and addresses of Noteholders received by the Indenture Trustee
in its capacity as Note Registrar. The Indenture Trustee may destroy any list
furnished to it as provided in Section 7.1 upon receipt of a new list so
furnished; provided, however, that so long as the Indenture Trustee is the Note
Registrar or the Notes are issued as Book-Entry Notes, no such list shall be
required to be preserved or maintained.
(b) The Noteholders may communicate pursuant to TIA Section 312(b)
with other Noteholders regarding their rights under this Indenture or under the
Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall
have the protection of TIA Section 312(c).
SECTION 7.3 REPORTS BY INDENTURE TRUSTEE. If required by TIA Section
313(a), within 60 days after each March 31, beginning with March 31, [____], the
Indenture Trustee shall mail to each Noteholder and shall file with the
Commission as required by TIA Sections 313(c) and 313(d), respectively, a brief
report dated as of such date that complies with TIA Section 313(a). The
Indenture Trustee also shall comply with TIA Section 313(b).
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 COLLECTION OF MONEY. Except as otherwise expressly provided
herein, the Indenture Trustee may demand payment or delivery of, and shall
receive and collect, directly and
35
without intervention or assistance of any fiscal agent or other intermediary,
all money and other property payable to or receivable by the Indenture Trustee
pursuant to this Indenture. The Indenture 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 the Trust
Estate, the Indenture 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 an Indenture Default under this Indenture and any right to
proceed thereafter as provided in Article V.
SECTION 8.2 ACCOUNTS.
(a) There has been established and there shall be maintained an
Eligible Account (initially at [___________]) in the name of the Indenture
Trustee until the Outstanding Note Amount is reduced to zero, which is
designated as the "Reserve Account". The Reserve Account shall be held for the
benefit of the Noteholders, and shall bear a designation clearly indicating that
the funds on deposit therein are held for the benefit of the Noteholders. The
Reserve Account shall be under the sole dominion and control of the Indenture
Trustee until the Outstanding Note Amount has been reduced to zero. On or prior
to the Closing Date, the Issuer shall deposit (or cause to be deposited) an
amount equal to the Targeted Reserve Account Balance into the Reserve Account.
(b) There has been established and there shall be maintained an
Eligible Account (initially at [___________]) in the name of the Indenture
Trustee until the Outstanding Note Amount is reduced to zero, which is
designated the "Collection Account". The Collection Account shall be held for
the benefit of the Noteholders , and shall bear a designation clearly indicating
that the funds on deposit therein are held for the benefit of the Noteholders.
The Collection Account shall be under the sole dominion and control of the
Indenture Trustee until the Outstanding Note Amount has been reduced to zero.
(c) There has been established and there shall be maintained an
Eligible Account (initially at [___________]) in the name of the Indenture
Trustee until the Outstanding Note Balance is reduced to zero, which is
designated as the "Principal Distribution Account." The Principal Distribution
Account shall be held for the benefit of the Noteholders, and shall bear a
designation clearly indicating that the funds on deposit therein are held for
the benefit of the Noteholders. The Principal Distribution Account shall be
under the sole dominion and control of the Indenture Trustee until the
Outstanding Note Amount has been reduced to zero.
(d) All monies deposited from time to time in the Accounts pursuant to
this Indenture or the other Transaction Documents shall be held by the Indenture
Trustee as part of the Collateral and shall be applied to the purposes herein
provided. If any Account shall cease to be an Eligible Account, the Indenture
Trustee, until the Outstanding Note Amount has been reduced to zero, shall, as
necessary, assist the Administrator in causing each Account to be moved to an
institution at which it shall be an Eligible Account.
SECTION 8.3 SERVICER CERTIFICATE.
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(a) Prior to 11:00 a.m., New York City time, on each Determination
Date, the Issuer shall cause the Servicer to agree to deliver to the Indenture
Trustee, the Issuer, the Administrator and each Paying Agent hereunder, a
certificate (the "Servicer Certificate") including, among other things, the
following information with respect to the related Payment Date and the related
Collection Period:
(i) the amount of Collections for such Collection Period;
(ii) the amount of Available Funds for such Collection Period;
(iii) the Accrued Class A-1 Note Interest, the Accrued Class A-2
Note Interest, the Accrued Class A-3 Note Interest and the Accrued
Class A-4 Note Interest with respect to such Payment Date;
(iv) the Class A-1 Note Balance, the Class A-2 Note Balance, the
Class A-3 Note Balance and the Class A-4 Note Balance, in each case
before giving effect to payments on such Payment Date;
(v) (A) the amount on deposit in the Reserve Account and the
Specified Targeted Account Balance, each as of the beginning and end
of the related Collection Period, (B) the amount deposited in the
Reserve Account in respect of such Payment Date, if any, (C) the
amount, if any, to be withdrawn from the Reserve Account on such
Payment Date, (D) the balance on deposit in the Reserve Account on
such Payment Date after giving effect to withdrawals therefrom and
deposits thereto in respect of such Payment Date and (E) the change in
such balance from the immediately preceding Payment Date;
(vi) the aggregate amount being paid on such Payment Date in
respect of interest on and principal of each Class of Notes;
(vii) the First Priority Principal Distribution Amount and the
Regular Principal Distribution Amount for such Payment Date;
(viii) the Note Factor for each Class of the Notes (after giving
effect to distributions to the Noteholders on such Payment Date);
(ix) the amount of Advances included in Available Funds for such
Collection Period;
(x) any Payment Date Advance Reimbursement for such Collection
Period;
(xi) amounts released to the Certificateholders on such Payment
Date;
(xii) the Servicing Fee and the Administration Fee for such
Collection Period; and
37
(xiii) the amount of Cumulative Net Residual Losses and
Cumulative Net Credit Losses through such Collection Period.
Each amount set forth pursuant to clauses (iii), (iv), (vi) and (vii) above
shall be expressed in the aggregate and as a dollar amount per $1,000 of
original principal balance of a Note.
(b) The Indenture Trustee shall have no duty or obligation to verify
or confirm the accuracy of any of the information or numbers set forth in the
Servicer Certificate delivered to the Indenture Trustee in accordance with this
Section, and the Indenture Trustee shall be fully protected in relying upon such
Servicer Certificate.
SECTION 8.4 DISBURSEMENT OF FUNDS.
(a) On each Payment Date, prior to 1:00 p.m., New York City time, the
Paying Agent, in accordance with the related Servicer Certificate and pursuant
to the instructions of the Servicer, shall transfer from the Collection Account
all Available Funds and shall apply such amount, in accordance with the
following priorities:
(i) to the Servicer, the Payment Date Advance Reimbursement;
(ii) pro rata, to the Servicer, the Servicing Fee, together with
any unpaid Servicing Fees in respect of one or more prior Collection
Periods, and to the Administrator, the Administration Fee, together
with any unpaid Administration Fees in respect of one or more prior
Collection Periods;
(iii) pro rata, to the Holders of the Notes, for payment to each
respective Class of Noteholders, an amount equal to the Accrued Class
A-1 Note Interest, the Accrued Class A-2 Note Interest, the Accrued
Class A-3 Note Interest and the Accrued Class A-4 Note Interest,
respectively, for such Payment Date;
(iv) to the Principal Distribution Account, the First Priority
Principal Distribution Amount for such Payment Date, which amount
shall be paid in the order of priority set forth in Section 8.4(b);
(v) to the Reserve Account, until the amount of funds in the
Reserve Account is equal to the Targeted Reserve Account Balance;
(vi) to the Principal Distribution Account, the Regular Principal
Distribution Amount for such Payment Date, if any, which will be
allocated to pay principal on the Notes in the order of priority set
forth in Section 8.4(b);
(vii) to the Indenture Trustee, the SUBI Trustee or the Owner
Trustee, as applicable, all amounts due as compensation or indemnity
payments (to the extent not previously paid) pursuant to the terms of
this Indenture, the Origination Trust Agreement or the Trust
Agreement; and
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(viii) any remaining funds shall be distributed to or at the
direction of the Certificateholder.
(b) On each Payment Date, prior to 1:00 p.m., New York City time, the
Paying Agent, in accordance with the related Servicer Certificate and pursuant
to the instructions of the Servicer, shall transfer from the Principal
Distribution Account all amounts on deposit therein and shall distribute such
amounts in the following order of priority:
(i) to the Holders of the Class A-1 Notes in respect of
principal, until the Class A-1 Notes are paid in full;
(ii) to the Holders of the Class A-2 Notes in respect of
principal, until the Class A-2 Notes are paid in full;
(iii) to the Holders of the Class A-3 Notes in respect of
principal, until the Class A-3 Notes are paid in full; and
(iv) to the Holders of the Class A-4 Notes in respect of
principal, until the Class A-4 Notes are paid in full.
(c) To the extent that Available Funds for any Payment Date are
insufficient to pay in full the amounts specified in clauses (i) through (iv) of
Section 8.4(a) on any Payment Date (the "Available Funds Shortfall Amount"), the
Indenture Trustee shall withdraw funds on deposit in the Reserve Account in
accordance with the related Servicer Certificate and pursuant to the
instructions of the Servicer to make such payments. After giving effect to all
payments set forth in the preceding sentence, funds shall also be withdrawn from
the Reserve Account in accordance with Section 8.4(d).
(d) If on any Payment Date, after giving effect to all deposits to and
withdrawals from the Reserve Account, the amount on deposit in the Reserve
Account exceeds the Targeted Reserve Account Balance, the Indenture Trustee
shall distribute any such excess to or at the direction of the
Certificateholder. Upon any such distributions to the Certificateholder, the
Noteholders will have no further rights in, or claims to such amounts.
(e) On each Payment Date or Redemption Date, from the amounts
allocated therefor in accordance with Section 8.4(a) and Section 8.4(b), the
Paying Agent shall duly and punctually distribute payments of principal and
interest on the Notes due and payable by check mailed to the Person whose name
appears as the registered holder of a Note (or one or more Predecessor Notes) on
the Note Register as of the close of business on the related Record Date, except
that with respect to Notes registered on the Record Date in the name of the
nominee of DTC (initially, such nominee to be Cede & Co.), payments will be made
by wire transfer in immediately available funds to the account designated by
such nominee. Such checks shall be mailed to the Person entitled thereto at the
address of such Person as it appears on the Note Register as of the applicable
Record Date without requiring that the Note be submitted for notation of
payment. Any reduction in the principal amount of any Note (or any one or more
Predecessor Notes) affected by any payments made on any Payment Date or
Redemption Date shall be binding upon all future holders of any Note issued upon
the registration of transfer thereof or in exchange hereof or in lieu hereof,
whether or not noted thereon. Amounts properly
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withheld under the Code by any Person from payment to any Noteholder of interest
or principal shall be considered to have been paid by the Indenture Trustee to
such Noteholder for purposes of this Indenture. If funds are expected to be
available pursuant to a notice delivered to the Indenture Trustee for payment in
full of the remaining unpaid principal amount of the Notes on a Payment Date or
Redemption Date, then the Indenture Trustee, in the name of and on behalf of the
Issuer, will notify each Person who was the registered holder of a Note as of
the Record Date preceding the most recent Payment Date or Redemption Date by
notice mailed within 30 days (and not less than 15 days) of such Payment Date or
Redemption Date and the amount then due and payable shall be payable only upon
presentation and surrender of the Note at the Corporate Trust Office of the
Indenture Trustee or at the office of the Indenture Trustee's agent appointed
for such purposes located in The City of New York.
(f) On each Payment Date, the Indenture Trustee shall send by first
class mail or other reasonable means (including, but not limited to, the posting
on the Indenture Trustee's website at www.jpmorgan.com/sfr) an unaudited report
(which may be or may be based upon the Servicer Certificate prepared by the
Servicer) to each Person that was a Noteholder as of the close of business on
the related Record Date (which shall be Cede & Co. as shown on the applicable
Servicer Certificate as the nominee of DTC unless Definitive Notes are issued
under the limited circumstances described herein) and each Rating Agency (via
electronic delivery in accordance with Section 11.4) setting forth the
information provided in the Servicer's Certificate delivered in accordance with
Section 8.3 with respect to such Payment Date and the related Collection Period.
Note Owners may obtain copies of such reports upon a request in writing to the
Indenture Trustee at the Corporate Trust Office.
(g) None of the Noteholders, the Indenture Trustee, the Owner Trustee,
the Transferor, the Administrator or the Servicer shall be required to refund
any amounts properly distributed or paid to them in accordance with this
Indenture, regardless of whether there are sufficient funds on any subsequent
Payment Date to make in full distributions to the Noteholders.
SECTION 8.5 GENERAL PROVISIONS REGARDING ACCOUNTS.
(a) All of the funds in the Reserve Account and the Collection Account
(if the Servicer is required to deposit collections in the Collection Account
within two Business Days of receipt) shall be invested and reinvested by the
Indenture Trustee, until the Outstanding Note Amount has been reduced to zero,
at the direction of the Administrator, in Permitted Investments selected by the
Administrator which mature no later than the day before the Payment Date
succeeding the date of such investment. No such investment shall be sold prior
to maturity. Any investment earnings on the Reserve Account and Collection
Account will be taxable to the Certificateholder (or, if the Transferor is the
Certificateholder and if the Transferor is disregarded for tax purposes in the
applicable jurisdictions, to VCI). Net investment earnings on any Account shall
be deposited in such Account.
(b) Subject to Section 6.1(c), the Indenture Trustee shall not in any
way be held liable by reason of any insufficiency in any Account resulting from
any loss on any Permitted Investment included therein, except for losses
attributable to the Indenture Trustee's
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failure to make payments on any such Permitted Investments issued by the
Indenture Trustee in its commercial capacity as principal obligor and not as
trustee, in accordance with their terms.
(c) If (i) the Administrator shall have failed to give investment
directions for any funds on deposit in the Reserve Account or Collection Account
to the Indenture Trustee by 11:00 a.m., New York City time (or such other time
as may be agreed by the Administrator and the Indenture Trustee), on any
Business Day or (ii) a Default or Indenture Default shall have occurred and be
continuing with respect to the Notes but the Notes shall not have been declared
due and payable pursuant to Section 5.2 or (iii) if the Notes shall have been
declared due and payable following an Indenture Default and amounts collected or
receivable from the Collateral are being applied in accordance with Section 5.5
as if there had not been such a declaration, then the Indenture Trustee shall,
to the fullest extent practicable, invest and reinvest funds in investments that
are Permitted Investments in accordance with standing instructions most recently
given by the Administrator.
SECTION 8.6 RELEASE OF COLLATERAL.
(a) Subject to the payment of its fees and expenses under Section 6.7
and the satisfaction of the conditions set forth in Section 4.1, the Indenture
Trustee may, and when required by the provisions of this Indenture shall,
execute instruments to release property from the lien of this Indenture, or
convey the Indenture Trustee's interest in the same, in a manner and under
circumstances that are not inconsistent with the provisions of this Indenture.
No party relying upon an instrument executed by the Indenture Trustee as
provided in this Article shall be bound to ascertain the Indenture Trustee's
authority, inquire into the satisfaction of any conditions precedent or see to
the application of any monies.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding, release any remaining portion of the Collateral that secured the
Notes from the lien of this Indenture and release to the Issuer or any other
Person entitled thereto any funds then on deposit in the Accounts. Such release
shall include delivery to the Issuer or its designee of the Transaction SUBI
Certificate and release of the lien of this Indenture and transfer of dominion
and control over the Accounts to the Issuer or its designee. The Indenture
Trustee shall release property from the lien of this Indenture pursuant to this
Section only upon receipt of an Issuer Request.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS.
(a) Except as provided in Section 9.2, without the consent of the
Noteholders or any other Person, the Issuer and the Indenture Trustee (when so
directed by an Issuer Request), may enter into one or more 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 for the
purpose of modifying in any manner the rights of the Noteholders under this
Indenture; provided that (i) any supplement that materially and adversely
affects the interests of
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the Noteholders shall require the consent of Noteholders evidencing not less
than a majority of the aggregate outstanding principal amount of the Outstanding
Notes, voting as a single class, and (ii) any supplement that materially and
adversely affects the interests of the Indenture Trustee, the Owner Trustee, the
Servicer, the Certificateholders or the Administrator shall require the prior
written consent of the Persons whose interests are materially and adversely
affected; provided further, that such action shall not, as evidenced by an
Opinion of Counsel delivered to the Indenture Trustee, (A) affect the treatment
of the Notes as debt for federal income tax purposes, (B) be deemed to cause a
taxable exchange of the Notes for federal income tax purposes or (C) cause the
Issuer, the Transferor or the Origination Trust to be classified as an
association (or a publicly traded partnership) taxable as a corporation for
federal income tax purposes. A supplement shall be deemed not to materially and
adversely affect the interests of the Noteholders if the Rating Agency Condition
is satisfied with respect to such supplement. The consent of the Servicer, the
Certificateholders or the Administrator shall be deemed to have been given if
the Servicer does not receive a written objection from such Person within 10
Business Days after a written request for such consent shall have been given.
(b) It shall not be necessary for the consent of any Person pursuant
to this Section for such Person to approve the particular form of any proposed
supplement, but it shall be sufficient if such Person consents to the substance
thereof.
(c) Notwithstanding anything herein to the contrary, any term or
provision of this Indenture may be amended by the Issuer and the Indenture
Trustee (when so directed by an Issuer Request) without the consent of any of
the Noteholders or any other Person to add, modify or eliminate any provisions
as may be necessary or advisable in order to comply with or obtain more
favorable treatment under or with respect to any law or regulation or any
accounting rule or principle (whether now or in the future in effect); it being
a condition to any such amendment that the Rating Agency Condition shall have
been satisfied.
(d) Prior to the execution of any supplemental indenture, the Initial
Beneficiary shall provide each Rating Agency with written notice of the
substance of such supplement. No later than 10 Business Days after the execution
of any supplemental indenture, the Issuer shall furnish a copy of such
supplement to each Rating Agency, the Servicer, the Administrator, the Owner
Trustee and the Indenture Trustee.
(e) The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further appropriate
agreements and stipulations as may be therein contained.
(f) Promptly after the execution by the Issuer and the Indenture
Trustee of any supplemental indenture pursuant to this Section or Section 9.2,
the Indenture Trustee shall mail to the Noteholders to which such amendment or
supplemental indenture relates a notice (to be provided by the Issuer) setting
forth in general terms the substance of such supplemental indenture. Any failure
of the Indenture 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.
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SECTION 9.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS.
With the consent of Noteholders holding not less than a majority of the
Outstanding Note Amount, the Issuer and the Indenture Trustee, when directed by
an Issuer Request, may enter into one or more 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 for the purpose of
modifying in any manner the rights of the Noteholders under this Indenture;
provided, that no supplemental indenture entered into under Section 9.1 or this
Section shall, without the consent of the Noteholder of each Outstanding Note
affected thereby and prior notice to the Rating Agencies:
(a) reduce the interest rate or principal amount of any Note, or delay
the Final Scheduled Payment Date of any Note without the consent of the Holder
of such Note;
(b) reduce the percentage of the Outstanding Note Amount, the consent
of the Noteholders of which is required for any such supplemental indenture or
the consent of the Noteholders of which is required for any waiver of compliance
with provisions of this Indenture or Indenture Defaults hereunder and the
consequences provided for in this Indenture;
(c) modify or alter the provisions of the proviso to the definition of
the term "Outstanding";
(d) reduce the percentage of the Outstanding Note Amount required to
direct the Indenture Trustee to direct the Issuer to sell the Trust Estate
pursuant to Section 5.4, if the proceeds of such sale would be insufficient to
pay the Outstanding Note Amount plus accrued but unpaid interest on the Notes;
(e) permit the creation of any lien ranking prior to or on a parity
with the lien of this Indenture with respect to any part of the Trust Estate or,
except as otherwise permitted or contemplated herein, terminate the lien of this
Indenture on any property at any time subject hereto or deprive any Noteholder
of the security provided by the lien of this Indenture; or
(f) impair the right to institute suit for the enforcement of payment
as provided in Section 5.7.
Any such supplemental indenture shall be executed only upon delivery of an
Opinion of Counsel delivered to the Indenture Trustee to the effect that such
action shall not (A) affect the treatment of the Notes as debt for federal
income tax purposes, (B) be deemed to cause a taxable exchange of the Notes for
federal income tax purposes or (C) cause the Issuer, the Transferor or the
Origination Trust to be classified as an association (or a publicly traded
partnership) taxable as a corporation for federal income tax purposes.
SECTION 9.3 EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article or the modifications thereby of the trusts created by
this Indenture, the Indenture 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 Indenture Trustee may but shall not be
obligated to enter into
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any such supplemental indenture that affects the Indenture Trustee's own rights,
duties, liabilities or indemnities 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 shall 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 Indenture Trustee, the Issuer and the Noteholders 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 shall 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 may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1 REDEMPTION.
(a) Pursuant to Section 9.4 of the Trust Agreement, the Transferor
shall be permitted at its option to purchase the interest in the Transaction
SUBI evidenced by the Transaction SUBI Certificate from the Issuer on any
Payment Date if the Outstanding Note Balance is less than or equal to 10% of the
Initial Note Balance. The purchase price for the Transaction SUBI Certificate
shall equal the Optional Purchase Price, which amount shall be deposited by the
Transferor into the Collection Account on the Redemption Date. In connection
with an Optional Purchase, the Notes shall be redeemed on the Redemption Date in
whole, but not in part, for the Redemption Price.
(b) If the Transferor exercises the Optional Purchase, on the
Redemption Date, prior to 1:00 p.m., New York City time, the Paying Agent shall
transfer the Optional Purchase Price from the Collection Account to the
Noteholders as the Redemption Price.
(c) If on any Payment Date the amount on deposit in the Reserve
Account, after giving effect to withdrawals therefrom and deposits thereto in
respect of that Payment Date, is greater than or equal to the balance of the
Notes then outstanding, then such amount will be used to redeem the then
Outstanding Notes. On such Payment Date, (i) the Indenture Trustee shall
transfer all amounts on deposit in the Reserve Account to the Collection
Account, (ii) the Paying Agent shall transfer an amount equal to the Outstanding
Note Amount to the Noteholders
44
as the Redemption Price, and (iii) the Outstanding Notes shall be redeemed in
whole, but not in part, on such Payment Date.
(d) If the Notes are to be redeemed pursuant to Sections 10.1(a) and
10.1(b) or Section 10.1(c), the Administrator or the Issuer shall provide at
least 30 days' prior notice of the redemption of the Notes to the Indenture
Trustee and the Issuer, and the Indenture Trustee shall provide prompt (but not
later than 10 days prior to the applicable Redemption Date) notice thereof to
the Noteholders.
SECTION 10.2 FORM OF REDEMPTION NOTICE. Notice of redemption under Section
10.1 shall be given by the Indenture Trustee by first-class mail, postage
prepaid, mailed to each Holder of Notes 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. In addition, the Administrator shall notify each
Rating Agency upon the redemption of the Notes, pursuant to the Administration
Agreement.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) the place where the Notes to be redeemed 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); and
(d) that on the Redemption Date, the Redemption Price will become due
and payable upon each such Note and that interest thereon shall cease to accrue
from and after the Redemption Date.
Notice of redemption of the Notes shall be given by the Indenture Trustee
in the name and at the expense of the Issuer. Failure to give notice of
redemption (or any defect therein) to any Noteholder shall not impair or affect
the validity of the redemption of any other Note.
SECTION 10.3 NOTES PAYABLE ON REDEMPTION DATE. The Notes to be redeemed
shall, following notice of redemption as required by Section 10.2, become due
and payable on the Redemption Date 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.
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ARTICLE XI
MISCELLANEOUS
SECTION 11.1 COMPLIANCE CERTIFICATES AND OPINIONS.
(a) Upon any application or request by the Issuer to the Indenture
Trustee to take any action under any provision of this Indenture, the Indenture
Trustee and each Rating Agency shall be entitled to receive (i) an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with, (ii) an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, and (iii) in the case of
conditions precedent compliance with which is subject to verification by
accountants, a certificate or opinion of an accountant that satisfies TIA
Section 314(c)(3).
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 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) In addition to any obligation imposed in Section 11.1(a) or
elsewhere in this Indenture:
(i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for
the release of any property or securities subject to the lien of this
Indenture, the Issuer shall furnish to the Indenture Trustee an
Officer's 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 Collateral or other property or
securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the Indenture
Trustee an Officer's 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 Trustee an Independent
Certificate as to the same matters, if the fair
value of the property or securities to be so deposited and of all
other such securities made the basis of any such withdrawal or release
since the commencement of the then-current calendar year of the
Issuer, as set forth in the certificates delivered pursuant to clause
(i) above and this clause, is 10% or more of the Outstanding Note
Amount, but such a certificate need not be furnished with respect to
any securities so deposited, if the fair value thereof to the Issuer
as set forth in the related Officer's Certificate is less than $25,000
or less than 1% of the Outstanding Note Amount.
(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 of this Indenture, the Issuer shall
also furnish to the Indenture Trustee an Officer's 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 under this Indenture in contravention of the provisions
hereof.
(iv) Whenever the Issuer is required to furnish to the Indenture
Trustee an Officer's 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 Trustee 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 of this Indenture since the commencement of the
then current calendar year, as set forth in the Officer's Certificates
required by clause (iii) above and this clause, equals 10% or more of
the Outstanding Note Amount, but such Officer's 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 Officer's
Certificate is less than $25,000 or less than 1% of the Outstanding
Note Amount.
(v) Notwithstanding Section 2.8 or any other provision of this
Section, the Issuer may (A) collect, liquidate, sell or otherwise
dispose of the Collateral as and to the extent permitted or required
by the Transaction Documents and (B) make cash payments out of the
Accounts as and to the extent permitted or required by the Transaction
Documents.
SECTION 11.2 FORM OF DOCUMENTS DELIVERED TO THE INDENTURE 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 may be based, insofar
as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel. Any such
47
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 Administrator, the Transferor
or the Issuer, stating that the information with respect to such factual matters
is in the possession of the Administrator, the Transferor or the Issuer.
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 Indenture 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 Indenture Trustee's 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 Indenture 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 Indenture 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 Indenture 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 Note 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
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Note.
SECTION 11.4 NOTICES. All demands, notices and communications hereunder
shall be in writing and shall be delivered or mailed by registered or certified
first-class United States mail, postage prepaid, hand delivery, prepaid courier
service, or by telecopier, and addressed in each case as follows: (i) if to the
Issuer, at the Corporate Trust Office of the Owner Trustee, with a
48
copy to the Administrator, at 3800 Hamlin Road, Auburn Hills, Michigan 48326
(telecopier no. (248) 754-4581), Attention: General Counsel, with a copy to the
Indenture Trustee; (ii) if to the Indenture Trustee, to [__________]; (iii) if
to Moody's, via electronic delivery for all relevant monthly information
(including the reports required by Section 8.4(f)) to
ServicerReports@Moodys.com, or to Moody's Investors Service, Inc., 99 Church
Street, New York, New York 10007 (telecopier no. (212) 298-7139), Attention: ABS
Monitoring Department - 4th Floor ; (iv) if to S&P, via electronic delivery to
Service_reports@Sandp.com; and for any information not available in electronic
format, to Standard & Poor's Ratings Services, 55 Water Street, New York, New
York 10041-0003 (telecopier no. (212) 438-2664), Attention: Asset Backed
Surveillance Group; or (v) at such other address as shall be designated by any
of the foregoing in a written notice to the other parties hereto. Delivery shall
occur only upon receipt or reported tender of such communication by an officer
of the recipient entitled to receive such notices located at the address of such
recipient for notices hereunder.
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 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 Indenture 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 of 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 Indenture Trustee shall be deemed to be a
sufficient giving of such notice.
Where this Indenture provides for notice to each Rating Agency, failure to
give such notice shall not affect any other rights or obligations created
hereunder, and shall not under any circumstance constitute an Indenture Default.
SECTION 11.6 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 11.7 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 Indenture Trustee in this
Indenture shall bind its successors.
49
SECTION 11.8 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 11.9 BENEFITS OF INDENTURE. Nothing in this Indenture or in the
Notes, expressed or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, the Noteholders (and, with respect to
Sections 8.3 and 8.4, the Certificateholders), 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.
SECTION 11.10 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 11.11 GOVERNING LAW. THIS INDENTURE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL, SUBSTANTIVE LAWS OF THE STATE OF NEW
YORK WITHOUT REFERENCE TO THE RULES THEREOF RELATING TO CONFLICTS OF LAW AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
SECTION 11.12 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 11.13 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 accompanied by an Opinion of Counsel reasonably
acceptable to the Indenture Trustee) 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
Indenture Trustee under this Indenture.
SECTION 11.14 TRUST OBLIGATION; NO RECOURSE. Each Noteholder or Note Owner,
by acceptance of a Note, or, in the case of a Note Owner, a beneficial interest
in a Note, covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee, the Transaction SUBI Trustee or the Owner Trustee in their
respective individual capacities, (ii) any Certificateholder or any other owner
of a beneficial interest in the Issuer, (iii) the Servicer, the Administrator or
the Origination Trust or (iv) any partner, owner, beneficiary, agent, officer,
director, employee, successor or assign of any Person described in clauses (i),
(ii) and (iii) above, except as any such Person may have expressly agreed (it
being understood that the Indenture Trustee, the SUBI Trustee and the Owner
Trustee have no such obligations in their individual capacity) and except that
any such partner, owner or beneficiary
50
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 11.15 NO PETITION. With respect to each Bankruptcy Remote Party,
each of the Indenture Trustee, by entering into this Indenture, and each
Noteholder and Note Owner, by accepting a Note or, in the case of a Note Owner,
a beneficial interest in a Note, hereby covenants and agrees that prior to the
date which is one year and one day after payment in full of all obligations
under each Financing (i) no party hereto shall authorize such Bankruptcy Remote
Party to commence a voluntary winding-up or other voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to
such Bankruptcy Remote Party or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect in any jurisdiction or seeking the
appointment of an administrator, a trustee, receiver, liquidator, custodian or
other similar official with respect to such Bankruptcy Remote Party or any
substantial part of its property or to consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against such Bankruptcy Remote Party, or to make a
general assignment for the benefit of any party hereto or any other creditor of
such Bankruptcy Remote Party, and (ii) none of the parties hereto shall commence
or join with any other Person in commencing any proceeding against such
Bankruptcy Remote Party under any bankruptcy, reorganization, liquidation or
insolvency law or statute now or hereafter in effect in any jurisdiction.
SECTION 11.16 LIMITATION OF LIABILITY OF OWNER TRUSTEE. Notwithstanding
anything contained herein to the contrary, this instrument has been
countersigned by [_____] not in its individual capacity but solely in its
capacity as Owner Trustee of the Issuer and in no event shall [__________] in
its individual capacity or any beneficial owner of the Issuer have any liability
for the representations, warranties, covenants, agreements or other obligations
of the Issuer hereunder, as to all of which recourse shall be had solely to the
assets of the Issuer.
SECTION 11.17 TIA INCORPORATION AND CONFLICTS. The provisions of TIA
Sections 310 through 317 that impose duties on any Person (including the
provisions automatically deemed included herein unless expressly excluded by
this Indenture) are a part of and govern this Indenture, whether or not
physically contained herein. If any provision hereof limits, qualifies or
conflicts with another provision hereof that is required to be included in this
Indenture by any of the provisions of the TIA, such required provision shall
control.
SECTION 11.18 INTENT.
(a) It is the intent of the Issuer that the Notes constitute
indebtedness for all financial accounting purposes and the Issuer agrees and
each purchaser of a Note (by virtue of the acquisition of such Note or an
interest therein) shall be deemed to have agreed, to treat the Notes as
indebtedness for all financial accounting purposes.
(b) It is the intent of the Issuer that the Notes constitute
indebtedness of the Issuer for all tax purposes and the Issuer agrees and each
purchaser of a Note (by virtue of the acquisition of such Note or an interest
therein) shall be deemed to have agreed to treat the Notes as indebtedness for
all tax purposes.
51
SECTION 11.19 EACH SUBI SEPARATE; ASSIGNEES OF SUBI. Each of the Indenture
Trustee, by entering into this Indenture, and each Noteholder or Note Owner, by
accepting a Note, or, in the case of a Note Owner, a beneficial interest in a
Note, hereby covenants and agrees that (a) the Transaction SUBI is a separate
series of the Origination Trust as provided in Section 3806(b)(2) of Chapter 38
of Title 12 of the Delaware Code, 12 Del.Code Section 3801 et seq., (b)(i) the
debts, liabilities, obligations and expenses incurred, contracted for or
otherwise existing with respect to the Transaction SUBI and the Transaction SUBI
Portfolio shall be enforceable against the Transaction SUBI Portfolio only, and
not against any Other SUBI Assets or the UTI Portfolio and (ii) the debts,
liabilities, obligations and expenses incurred, contracted for or otherwise
existing with respect to any Other SUBI, any Other SUBI Portfolio, the UTI or
the UTI Portfolio shall be enforceable against such Other SUBI Portfolio or the
UTI Portfolio only, as applicable, and not against the Transaction SUBI or any
Other SUBI Assets, (c) except to the extent required by law, UTI Assets or SUBI
Assets with respect to any SUBI (other than the Transaction SUBI) shall not be
subject to the claims, debts, liabilities, expenses or obligations arising from
or with respect to the Transaction SUBI in respect of such claim, (d)(i) no
creditor or holder of a claim relating to the Transaction SUBI or the
Transaction SUBI Portfolio shall be entitled to maintain any action against or
recover any assets allocated to the UTI or the UTI Portfolio or any Other SUBI
or the assets allocated thereto, and (ii) no creditor or holder of a claim
relating to the UTI, the UTI Portfolio or any SUBI other than the Transaction
SUBI or any SUBI Assets other than the Transaction SUBI Portfolio shall be
entitled to maintain any action against or recover any assets allocated to the
Transaction SUBI, and (e) any purchaser, assignee or pledgee of an interest in
the Transaction SUBI or the Transaction SUBI Certificate must, prior to or
contemporaneously with the grant of any such assignment, pledge or security
interest, (i) give to the Origination Trust a non-petition covenant
substantially similar to that set forth in Section 6.9 of the Origination Trust
Agreement, and (ii) execute an agreement for the benefit of each holder,
assignee or pledgee from time to time of the UTI or UTI Certificate and any
Other SUBI or Other SUBI Certificate, to release all claims to the assets of the
Origination Trust allocated to the UTI Portfolio and each Other SUBI Portfolio
and in the event that such release is not given effect, to fully subordinate all
claims it may be deemed to have against the assets of the Origination Trust
allocated to the UTI Portfolio and each Other SUBI Portfolio.
SECTION 11.20 SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL. Each of the
parties hereto hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Indenture or any documents executed and delivered in
connection herewith, or for recognition and enforcement of any judgment in
respect thereof, to the nonexclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of America for the Southern
District of New York and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar
52
form of mail), postage prepaid, to such Person at its address determined in
accordance with Section 11.4 of this Indenture;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to sue in any other jurisdiction; and
(e) to the extent permitted by applicable law, waives all right of
trial by jury in any action, proceeding or counterclaim based on, or arising out
of, under or in connection with this Indenture, any other Transaction Document,
or any matter arising hereunder or thereunder.
SECTION 11.21 SUBORDINATION OF CLAIMS. Each Noteholder or Note Owner, by
accepting a Note, or, in the case of a Note Owner, a beneficial interest in a
Note, hereby covenants and agrees that, to the extent such Person is deemed to
have any interest in any assets of the Transferor, or a securitization vehicle
(other than the Issuer) related to the Transferor, dedicated to other debt
obligations of the Transferor or debt obligations of any other securitization
vehicle (other than the Issuer) related to the Transferor, such Person's
interest in those assets is subordinate to claims or rights of such other
debtholders to those other assets. Furthermore, each Noteholder or Note Owner,
by accepting a Note, or, in the case of a Note Owner, a beneficial interest in a
Note, hereby covenants and agrees that such agreement constitutes a
subordination agreement for purposes of Section 510(a) of the Bankruptcy Code.
SECTION 11.22 INFORMATION REQUESTS. The parties hereto shall provide any
information reasonably requested by the Servicer, the Issuer, the Transferor or
any of their Affiliates, at the expense of the Servicer, the Issuer, the
Transferor or any of their Affiliates, as applicable, in order to comply with or
obtain more favorable treatment under any current or future law, rule,
regulation, accounting rule or principle.
SECTION 11.23 REGULATION AB INFORMATION TO BE PROVIDED BY THE INDENTURE
TRUSTEE. (a) For so long as the Issuer is required to report under the Exchange
Act, the Indenture Trustee shall (i) on or before the fifth Business Day of each
month, provide to the Transferor, in writing, such information regarding the
Indenture Trustee as is requested by the Transferor (if any) for the purpose of
compliance with Item 1117 of Regulation AB; provided, however, that the
Indenture Trustee shall not be required to provide such information in the event
that there has been no change to the information previously provided by the
Indenture Trustee to Transferor, and (ii) as promptly as practicable following
notice to or discovery by a Responsible Officer of the Indenture Trustee of any
changes to such information, provide to the Transferor, in writing, such updated
information.
(a) As soon as available but no later than March 15 of each calendar
year for so long as the Issuer is required to report under the Exchange Act,
commencing in [_____], the Indenture Trustee shall:
(i) deliver to the Transferor a report regarding the Indenture
Trustee's assessment of compliance with the Servicing Criteria during
the immediately preceding calendar year, as required under paragraph
(b) of Rule 13a-18, Rule 15d-18 of the Exchange Act and Item 1122 of
Regulation AB. Such report shall be signed by an authorized officer of
the Indenture Trustee, and shall address each
53
of the Servicing Criteria specified in Exhibit C or such criteria as
mutually agreed upon by the Transferor and the Indenture Trustee;
(ii) deliver to the Transferor a report of a registered public
accounting firm that attests to, and reports on, the assessment of
compliance made by the Indenture Trustee and delivered pursuant to the
preceding paragraph. Such attestation shall be in accordance with
Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities
Act and the Exchange Act; and
(iii) deliver to the Transferor and any other Person that will be
responsible for signing the certification (a "Sarbanes Certification")
required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act
(pursuant to Section 302 of the Sarbanes-Oxley Act of 2002) on behalf
of the Issuer or the Transferor substantially in the form attached
hereto as Exhibit D or such form as mutually agreed upon by the
Transferor and the Indenture Trustee.
The Indenture Trustee acknowledges that the parties identified in
clause (iii) above may rely on the certification provided by the
Indenture Trustee pursuant to such clause in signing a Sarbanes
Certification and filing such with the Commission.
[Signature Page to Follow]
54
IN WITNESS WHEREOF, the Issuer and the Indenture 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.
VOLKSWAGEN AUTO LEASE TRUST 20[__]-[__],
AS ISSUER
By: [_________________________________],
not in its individual capacity but
solely as Owner Trustee
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[________________], as Indenture Trustee
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
S-1
SCHEDULE I
PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS
In addition to the representations, warranties and covenants contained in
this Indenture, the Issuer hereby represents, warrants, and covenants to the
Indenture Trustee as follows on the Closing Date:
1. The Indenture creates a valid and continuing security interest (as defined in
the applicable UCC) in the Collateral in favor of the Indenture Trustee, which
security interest is prior to all other Adverse Claims and is enforceable as
such as against creditors of and purchasers from the Issuer.
2. The Transaction SUBI Certificate constitutes a "general intangible,"
"instrument," "certificated security," or "tangible chattel paper," within the
meaning of the applicable UCC. The Accounts and all subaccounts thereof,
constitute either deposit accounts or securities accounts.
3. All of the Collateral that constitutes securities entitlements has been or
will have been credited to one of the Accounts. The securities intermediary for
each Account has agreed to treat all assets credited to the Accounts as
"financial assets" within the meaning of the applicable UCC.
4. The Issuer owns and has good and marketable title to the Collateral free and
clear of any Adverse Claims, claim or encumbrance of any Person, excepting only
liens for taxes, assessments or similar governmental charges or levies incurred
in the ordinary course of business that are not yet due and payable or as to
which any applicable grace period shall not have expired, or that are being
contested in good faith by proper proceedings and for which adequate reserves
have been established, but only so long as foreclosure with respect to such a
lien is not imminent and the use and value of the property to which the Adverse
Claim attaches is not impaired during the pendency of such proceeding.
5. The Issuer has received all consents and approvals to the grant of the
security interest in the Collateral hereunder to the Indenture Trustee required
by the terms of the Collateral that constitutes instruments or payment
intangibles.
6. The Issuer has received all consents and approvals required by the terms of
the Collateral that constitutes securities entitlements, certificated securities
or uncertificated securities to the transfer to the Indenture Trustee of its
interest and rights in the Collateral hereunder.
7. The Issuer has caused or will have caused, within ten days after the
effective date of the Indenture, the filing of all appropriate financing
statements in the proper filing office in the appropriate jurisdictions under
applicable law in order to perfect the security interest in the Collateral
granted to the Indenture Trustee hereunder.
8. With respect to Collateral that constitutes an instrument or tangible chattel
paper, either:
I-1
(i) All original executed copies of each such instrument or tangible
chattel paper have been delivered to the Indenture Trustee; or
(ii) Such instruments or tangible chattel paper are in the possession of a
custodian and the Indenture Trustee has received a written acknowledgment
from such custodian that such custodian is holding such instruments or
tangible chattel paper solely on behalf and for the benefit of the
Indenture Trustee; or
(iii) A custodian received possession of such instruments or tangible
chattel paper after the Indenture Trustee received a written acknowledgment
from such custodian that such custodian is acting solely as agent of the
Indenture Trustee.
9. With respect to the Accounts and all subaccounts thereof that constitute
deposit accounts, either:
(i) The Issuer has delivered to the Indenture Trustee a fully executed
agreement pursuant to which the bank maintaining the deposit accounts has
agreed to comply with all instructions originated by the Indenture Trustee
directing disposition of the funds in the Accounts without further consent
by the Issuer; or
(ii) The Issuer has taken all steps necessary to cause the Indenture
Trustee to become the account holder of the Accounts.
10. With respect to Collateral or Accounts or subaccounts thereof that
constitute securities accounts or securities entitlements, either:
(i) The Issuer has caused or will have caused, within ten days after the
effective date of the Indenture, the filing of all appropriate financing
statements in the proper filing office in the appropriate jurisdictions
under applicable law in order to perfect the security interest granted in
the Collateral to the Indenture Trustee; or
(ii) The Issuer has delivered to the Indenture Trustee a fully executed
agreement pursuant to which the securities intermediary has agreed to
comply with all instructions originated by the Indenture Trustee relating
to the Accounts without further consent by the Issuer; or
(iii) The Issuer has taken all steps necessary to cause the securities
intermediary to identify in its records the Indenture Trustee as the person
having a security entitlement against the securities intermediary in the
Accounts.
11. With respect to Collateral that constitutes certificated securities (other
than securities entitlements), all original executed copies of each security
certificate that constitutes or evidences the Collateral have been delivered to
the Indenture Trustee, and each such security certificate either (i) is in
bearer form, (ii) has been indorsed by an effective indorsement to the Indenture
Trustee or in blank, or (iii) has been registered in the name of the Indenture
Trustee.
Other than the transfer of the Transaction SUBI and the Transaction SUBI
Certificate from VCI to the Transferor under the SUBI Sale Agreement, the
transfer of the Transaction SUBI and the
2
Transaction SUBI Certificate from the Transferor to the Issuer under the SUBI
Transfer Agreement and the security interest in the Collateral granted to the
Indenture Trustee pursuant to the Indenture, none of VCI, the Transferor or the
Issuer has pledged, assigned, sold, granted a security interest in, or otherwise
conveyed any of the Collateral or the Accounts or any subaccounts thereof. The
Issuer has not authorized the filing of, or is aware of any financing statements
against the Issuer that include a description of collateral covering the
Collateral or the Accounts or any subaccount thereof other than any financing
statement relating to the security interest granted to the Indenture Trustee
hereunder or that has been terminated.
12. None of the instruments, certificated securities or tangible chattel paper
that constitute or evidence the Collateral has any marks or notations indicating
that they have been pledged, assigned or otherwise conveyed to any Person other
than the Indenture Trustee.
13. Neither the Accounts nor any subaccounts thereof are in the name of any
person other than the Issuer or the Indenture Trustee. The Issuer has not
consented to the securities intermediary of any Account to comply with
entitlement orders of any person other than the Indenture Trustee.
3
EXHIBIT A
FORM OF NOTE
REGISTERED $___________________
No. R-_______ CUSIP NO. __________
ISIN NO. ___________
SEE REVERSE FOR CERTAIN DEFINITIONS
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
TRANSFERS OF THE NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE TAX
TRANSFER DOCUMENTATION AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE
INDENTURE.
THE HOLDER, BY ACCEPTANCE OF THIS NOTE, SHALL BE DEEMED TO HAVE AGREED TO
TREAT THE NOTES AS DEBT SOLELY OF THE ISSUER FOR UNITED STATES FEDERAL, STATE
AND LOCAL INCOME, FRANCHISE AND/OR VALUE ADDED TAX PURPOSES.
A-1
VOLKSWAGEN AUTO LEASE TRUST 20[__]-[__]
[_____]% ASSET BACKED NOTE, CLASS [A-1] [A-2] [A-3] [A-4]
VOLKSWAGEN AUTO LEASE TRUST 20[__]-[__], a Delaware statutory trust
(including any permitted successors and assigns, the "Issuer"), for value
received, hereby promises to pay to CEDE & CO., or registered assigns, the
principal sum of _____________________ Dollars ($[_____]) in monthly
installments on the 20th of each month, or if such day is not a Business Day, on
the immediately succeeding Business Day, commencing on [_____], [_____] (each, a
"Payment Date") until the principal of this Note is paid or made available for
payment, and to pay interest on each Payment Date on the Class [A-1] [A-2] [A-3]
[A-4] Note Balance as of the preceding Payment Date (after giving effect to all
payments of principal made on the preceding Payment Date), or as of the Closing
Date in the case of the first Payment Date or if no interest has yet been paid,
at the rate per annum shown above (the "Interest Rate"), in each case as and to
the extent described below; provided, however, that the entire Class [A-1] [A-2]
[A-3] [A-4] Note Balance shall be due and payable on the earlier of [_____](1)
[_____](2) [_____](3) [_____](4) (the "Final Scheduled Payment Date") and the
Redemption Date, if any, pursuant to Section 10.1 of the Indenture. Interest on
this Note will accrue for each Payment Date from and including the preceding
Payment Date (or, in the case of the initial Payment Date or if no interest has
yet been paid, from and including the Closing Date) to but excluding such
Payment Date. Interest will be computed on the basis of [actual days elapsed and
a 360-day year](5) [a 360-day year of twelve 30-day months](6). The Issuer shall
pay interest on overdue installments of interest at the Interest Rate to the
extent lawful. Such principal of and interest on this Note shall be paid in the
manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States as at the time of payment is legal tender for
payment of public and private debts. All payments made by the Issuer with
respect to this Note shall be applied first to interest due and payable on this
Note as provided above and then to the unpaid principal of this Note.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
Unless the certificate of authentication hereon has been executed by the
Indenture Trustee the name of which appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture referred to on the
reverse hereof or be valid or obligatory for any purpose.
- ----------
(1) Insert for the Class A-1 Notes.
(2) Insert for the Class A-2 Notes.
(3) Insert for the Class A-3 Notes.
(4) Insert for the Class A-4 Notes.
(5) Insert for the Class A-1 Notes.
(6) Insert for the Class A-2 Notes, the Class A-3 Notes and the Class A-4
Notes.
A-2
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or by facsimile, by its Authorized Officer as of the date set forth
below.
Dated: ____________, [____]
VOLKSWAGEN AUTO LEASE
TRUST [______________],
By: [__________________________], not in
its individual capacity but solely
as Owner Trustee
By
-------------------------------------
Name:
----------------------------------
Title:
---------------------------------
A-3
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: ____________, [_____]
[_____________________________________],
as Indenture Trustee
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
A-4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its "[_____]% Asset Backed Notes, Class [A-1] [A-2] [A-3] [A-4]"
(herein called the "Notes") issued under an Indenture, dated as of [__________],
[_____] (such indenture, as supplemented or amended, is herein called the
"Indenture"), between the Issuer and [___________], as trustee (the "Indenture
Trustee", which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations
thereunder of the Issuer, the Indenture Trustee and the Noteholders. The Notes
are subject to all terms of the Indenture. All terms used in this Note that are
defined in the Indenture, as supplemented or amended, shall have the meanings
assigned to them in or pursuant to the Indenture, as so supplemented or amended.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class
A-4 Notes are and will be equally and ratably secured by the Collateral pledged
as security therefor as provided in the Indenture. However, to the extent
provided in the Indenture and prior to an acceleration of the principal amount
of the Notes after an Event of Default, each Class will receive principal
payments sequentially so no principal payments shall be made in respect of the
Class A-2 Notes until the Class A-1 Notes have been paid in full, no principal
payments shall be made in respect of the Class A-3 Notes until the Class A-2
Notes have been paid in full, and no principal payments shall be made in respect
of the Class A-4 Notes until the Class A-3 Notes have been paid in full. All
covenants and agreements made by the Issuer in the Indenture are for the benefit
of the Holders of the Notes.
Principal payable on the Notes will be paid on each Payment Date in the
amount specified in the Indenture. As described above, the entire unpaid
principal amount of this Note will be payable on the earlier of the Final
Scheduled Payment and the Redemption Date, if any, selected pursuant to the
Indenture. Notwithstanding the foregoing, under certain circumstances, the
entire unpaid principal amount of the Notes shall be due and payable following
the occurrence and continuance of an Indenture Default, as described in the
Indenture. In such an event, principal payments on the Class A-1 Notes shall be
made first and principal payments on the remaining Classes of Notes shall be
made pro rata to the Noteholders entitled thereto.
Payments of principal and interest on this Note due and payable on each
Payment Date or Redemption Date shall be made by check mailed to the Person
whose name appears as the registered holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on the
related Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of The Depository Trust Company (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in immediately
available funds to the account designated by such nominee. Such checks shall be
mailed to the Person entitled thereto at the address of such Person as it
appears on the Note Register as of the applicable Record Date without requiring
that this Note be submitted for notation of payment. Any reduction in the
principal amount of this Note (or any one or more Predecessor Notes) affected by
any payments made on any Payment Date or Redemption Date shall be binding upon
all future holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted
hereon. If funds are expected to be available, as provided in the Indenture, for
payment in full of the remaining unpaid principal
A-5
amount of this Note on a Payment Date or Redemption Date, then the Indenture
Trustee, in the name of and on behalf of the Issuer, will notify the Person who
was the registered holder hereof as of the Record Date preceding such Payment
Date or Redemption Date by notice mailed within five days of such Payment Date
or Redemption Date and the amount then due and payable shall be payable only
upon presentation and surrender of this Note at the Corporate Trust Office of
the Indenture Trustee or at the office of the Indenture Trustee's agent
appointed for such purposes located in The City of New York.
As provided in the Indenture, the Transferor will be permitted at its
option to purchase the interest in the Transaction SUBI evidenced by the
Transaction SUBI Certificate from the Issuer on any Payment Date if, either
before or after giving effect to any payment of principal required to be made on
such Payment Date, the Note Balance is less than or equal to 10% of the Initial
Note Balance. The purchase price for the Transaction SUBI Certificate shall
equal the Note Balance, together with accrued interest thereon up to but not
including the Redemption Date (the "Optional Purchase Price"), which amount
shall be deposited by the Transferor into the Collection Account on the Payment
Date fixed for redemption. In connection with an Optional Purchase, the Notes
will be redeemed on such Payment Date in whole, but not in part, for the
Redemption Price.
In addition, as provided in the Indenture, if on any Payment Date the
amount on deposit in the Reserve Account, after giving effect to withdrawals
therefrom and deposits thereto in respect of that Payment Date, is greater than
or equal to the balance of the Notes then outstanding, such amount will be used
to redeem the then Outstanding Notes.
As provided in the Indenture and subject to certain limitations set forth
therein, the transfer of this Note may be registered on the Note Register upon
surrender of this Note for registration of transfer at the office or agency
designated by the Issuer pursuant to the Indenture. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such registration
of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case of a
Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under
the Indenture or any certificate or other writing delivered in connection
therewith against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Indenture Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed 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.
Each Noteholder or Note Owner, by accepting a Note, or, in the case of a
Note Owner, a beneficial interest in a Note, covenants and agrees that, to the
extent such Person is deemed to
6
have any interest in any assets of the Transferor, or a securitization vehicle
(other than the Issuer) related to the Transferor, dedicated to other debt
obligations of the Transferor or debt obligations of any other securitization
vehicle (other than the Issuer) related to the Transferor, such Person's
interest in those assets is subordinate to claims or rights of such other
debtholders to those other assets. Furthermore, each Noteholder or Note Owner,
by accepting a Note, or, in the case of a Note Owner, a beneficial interest in a
Note, covenants and agrees that such agreement constitutes a subordination
agreement for purposes of Section 510(a) of the Bankruptcy Code.
It is the intent of the Issuer that the Notes constitute indebtedness for
all financial accounting and tax purposes and the Issuer agrees and each
purchaser of a Note (by virtue of the acquisition of such Note or an interest
therein) shall be deemed to have agreed, to treat the Notes as indebtedness for
all financial accounting and tax purposes.
Each Noteholder or Note Owner by acceptance of a Note, or, in the case of a
Note Owner, a beneficial interest in a Note, will be deemed to have represented
that (a) such Noteholder or Note Owner is not, and will not acquire the Note or
beneficial interest therein on behalf or with the assets of, any "employee
benefit plan" as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), any "plan" as defined in Section
4975(e)(1) of the Code, an entity whose underlying assets include "plan assets"
of any of the foregoing, or a governmental plan as defined in Section 3(32) of
ERISA which is subject to applicable law that is substantially similar to the
fiduciary responsibility provisions of ERISA or Section 4975 of the Code or (b)
the acquisition and holding of the Note or beneficial interest therein will not
give rise to nonexempt prohibited transaction under ERISA or Section 4975 of the
Code (or, in the case of a governmental plan, any substantially similar law).
The Notes represent obligations of the Issuer only and do not represent
interests in, recourse to or obligations of the Transferor, the UTI
Beneficiaries or any of their respective Affiliates.
With respect to each Bankruptcy Remote Party, each Noteholder or Note
Owner, by acceptance of a Note, or, in the case of a Note Owner, a beneficial
interest in a Note, hereby covenants and agrees that prior to the date which is
one year and one day after payment in full of all obligations under each
Financing (i) such Noteholder or Note Owner shall not authorize such Bankruptcy
Remote Party to commence a voluntary winding-up or other voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to
such Bankruptcy Remote Party or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect in any jurisdiction or seeking the
appointment of an administrator, a trustee, receiver, liquidator, custodian or
other similar official with respect to such Bankruptcy Remote Party or any
substantial part of its property or to consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against such Bankruptcy Remote Party, or to make a
general assignment for the benefit of any party hereto or any other creditor of
such Bankruptcy Remote Party, and (ii) such Noteholder or Note Owner shall not
commence or join with any other Person in commencing any proceeding against such
Bankruptcy Remote Party under any bankruptcy, reorganization, liquidation or
insolvency law or statute now or hereafter in effect in any jurisdiction. Each
Noteholder or Note Owner agrees that, prior to the date which is one year and
one day after the payment in full of all
7
obligations under each Financing, it will not institute against, or join any
other Person in instituting against, any Bankruptcy Remote Party an action in
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or similar proceeding under the laws of the United States or any State of the
United States.
Prior to the due presentment for registration of transfer of this Note, the
Owner Trustee, the Indenture Trustee and any agent of the Owner Trustee or the
Indenture Trustee may treat the Person in whose name this Note (as of the day of
determination or as of such other date as may be specified in the Indenture) is
registered as the owner hereof for all purposes, whether or not this Note be
overdue, and neither the Owner Trustee, the Indenture Trustee nor any such agent
shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Noteholders under the Indenture at any time by the
Issuer with the consent of Noteholders representing not less than a majority of
the Outstanding Note Amount. The Indenture also contains provisions permitting
Noteholders representing specified percentages of the Outstanding Note Amount,
on behalf of all Noteholders, to waive compliance by the Issuer with certain
provisions of the Indenture and certain past Indenture Defaults and their
consequences. Any such consent or waiver by the Noteholder of this Note (or any
one or more Predecessor Notes) shall be conclusive and binding upon such
Noteholder and upon all future Noteholders of this Note and of any note issued
upon the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note. The
Indenture also permits the Issuer and the Indenture Trustee to amend or waive
certain terms and conditions set forth in the Indenture without the consent of
the Noteholders.
The Notes are issuable only in registered form in denominations as provided
in the Indenture, subject to certain limitations therein set forth.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL SUBSTANTIVE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE
RULES THEREOF RELATING TO CONFLICTS OF LAW AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Each Noteholder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in a Note, covenants and agrees that (a) the
Transaction SUBI is a separate series of the Origination Trust as provided in
Section 3806(b)(2) of Chapter 38 of Title 12 of the Delaware Code, 12 Del.Code
Section 3801 et seq., (b)(i) the debts, liabilities, obligations and expenses
incurred, contracted for or otherwise existing with respect to the Transaction
SUBI and the Transaction SUBI Portfolio shall be enforceable against the
Transaction SUBI Portfolio only, and not against any Other SUBI Assets or the
UTI Portfolio and (ii) the debts, liabilities, obligations and expenses
incurred, contracted for or otherwise existing with respect to any Other SUBI,
any Other SUBI Portfolio, the UTI or the UTI Portfolio shall be enforceable
against such Other SUBI Portfolio or the UTI Portfolio only, as applicable, and
not against the Transaction SUBI or any Other SUBI Assets, (c) except to the
extent required by law, UTI Assets or SUBI Assets with respect to any SUBI
(other than the Transaction SUBI) shall not be subject to the
8
claims, debts, liabilities, expenses or obligations arising from or with respect
to the Transaction SUBI in respect of such claim, (d)(i) no creditor or holder
of a claim relating to the Transaction SUBI or the Transaction SUBI Portfolio
shall be entitled to maintain any action against or recover any assets allocated
to the UTI or the UTI Portfolio or any Other SUBI or the assets allocated
thereto, and (ii) no creditor or holder of a claim relating to the UTI, the UTI
Portfolio or any SUBI other than the Transaction SUBI or any SUBI Assets other
than the Transaction SUBI Portfolio shall be entitled to maintain any action
against or recover any assets allocated to the Transaction SUBI, and (e) any
purchaser, assignee or pledgee of an interest in the Transaction SUBI or the
Transaction SUBI Certificate, must, prior to or contemporaneously with the grant
of any such assignment, pledge or security interest, (i) give to the Origination
Trust a non-petition covenant substantially similar to that set forth in Section
6.9 of the Origination Trust Agreement and (ii) execute an agreement for the
benefit of each holder, assignee or pledgee from time to time of the UTI or UTI
Certificate and any Other SUBI or Other SUBI Certificate, to release all claims
to the assets of the Origination Trust allocated to the UTI and each Other SUBI
Portfolio and in the event that such release is not given effect, to fully
subordinate all claims it may be deemed to have against the assets of the
Origination Trust allocated to the UTI Portfolio and each Other SUBI Portfolio.
No reference herein to the Indenture and no provision of this Note or the
Indenture shall alter or impair the obligation of the Issuer, which is absolute
and unconditional, to pay the principal of and interest on this Note at the
times, place and rate and in the coin or currency herein prescribed.
9
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
_______________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto _____________________________________________________________ (name and
address of assignee) the within Note and all rights thereunder, and hereby
irrevocably constitutes and appoints attorney, to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: (1) Signature Guaranteed:
------------------------
- ----------
(1) The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.
A-10
EXHIBIT B
FORM OF DEPOSITORY AGREEMENT
[on file with Mayer, Brown, Rowe & Maw LLP]
B-1
EXHIBIT C
SERVICING CRITERIA TO BE ADDRESSED IN
INDENTURE TRUSTEE'S ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by the Indenture Trustee shall
address, at a minimum, the criteria identified as below as "Applicable Servicing
Criteria":
[To be inserted]
C-1
EXHIBIT D
FORM OF INDENTURE TRUSTEE'S ANNUAL CERTIFICATION
RE: VOLKSWAGEN AUTO LEASE TRUST 20[__]-[__]
[______________], not in its individual capacity but solely as indenture
trustee (the "Indenture Trustee"), certifies to Volkswagen Auto Lease
Underwritten Funding (the "Transferor"), and its officers, with the knowledge
and intent that they will rely upon this certification, that:
(1) It has reviewed the report on assessment of the Indenture Trustee's
compliance provided in accordance with Rules 13a-18 and 15d-18 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and Item 1122
of Regulation AB (the "Servicing Assessment"), and the registered public
accounting firm's attestation report provided in accordance with Rules 13a-18
and 15d-18 under the Exchange Act and Section 1122(b) of Regulation AB (the
"Attestation Report") that were delivered by the Indenture Trustee to the
Transferor pursuant to the Indenture, dated as of [__________], by and between
the Indenture Trustee and Volkswagen Auto Lease Trust 20[__]-[__] (collectively,
the "Indenture Trustee Information");
(2) To the best of its knowledge, the Indenture Trustee Information, taken
as a whole, does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in the light of the
circumstances under which such statements were made, not misleading with respect
to the period of time covered by the Indenture Trustee Information;
(3) To the best of its knowledge, all of the Indenture Trustee Information
required to be provided by the Indenture Trustee under the Agreement has been
provided to the Transferor; and
(4) To the best of its knowledge, except as disclosed in the Servicing
Assessment or the Attestation Report, the Indenture Trustee has fulfilled its
obligations under the Agreement.
[______________________], not in its
individual capacity but solely as
Indenture Trustee
Date: _________________________
D-1
APPENDIX A
DEFINITIONS
The following terms have the meanings set forth, or referred to, below:
"Accounts" means the Collection Account, the Reserve Account and the
Principal Distribution Account.
"Accrued Class A-1 Note Interest" shall mean, with respect to any Payment
Date, the sum of the Class A-1 Noteholders' Monthly Accrued Interest for such
Payment Date and the Class A-1 Noteholders' Interest Carryover Shortfall.
"Accrued Class A-2 Note Interest" shall mean, with respect to any Payment
Date, the sum of the Class A-2 Noteholders' Monthly Accrued Interest for such
Payment Date and the Class A-2 Noteholders' Interest Carryover Shortfall.
"Accrued Class A-3 Note Interest" shall mean, with respect to any Payment
Date, the sum of the Class A-3 Noteholders' Monthly Accrued Interest for such
Payment Date and the Class A-3 Noteholders' Interest Carryover Shortfall.
"Accrued Class A-4 Note Interest" shall mean, with respect to any Payment
Date, the sum of the Class A-4 Noteholders' Monthly Accrued Interest for such
Payment Date and the Class A-4 Noteholders' Interest Carryover Shortfall.
"Accrued Note Interest" shall mean, with respect to any Payment Date, the
sum of the Accrued Class A-1 Note Interest, the Accrued Class A-2 Note Interest,
the Accrued Class A-3 Note Interest and the Accrued Class A-4 Note Interest.
"Act" has the meaning set forth in Section 11.3(a) of the Indenture.
"Administration Agreement" means the Administration Agreement, dated as of
the Closing Date, among the Administrator, the Issuer and the Indenture Trustee,
as the same may be amended and supplemented from time to time.
"Administration Fee" means, with regard to the Administrator of the Issuer
under the Administration Agreement, for any Collection Period, an amount equal
to $5,000.
"Administrative Trustee" means U.S. Bank, as Administrative Trustee under
the Origination Trust Agreement, and its successors.
"Administrator" means VCI, or any successor Administrator for the Issuer
under the Administration Agreement.
"Advance" has the meaning set forth in Section 7.8 of the Transaction SUBI
Servicing Supplement.
"Adverse Claim" means, for any asset or property of a Person, a lien,
security interest, mortgage, pledge or encumbrance in, of or on such asset or
property in favor of any other Person, except any Permitted Lien.
"Affiliate" means, for any specified Person, any other Person which,
directly or indirectly, controls, is controlled by or is under common control
with such specified Person and "affiliated" has a meaning correlative to the
foregoing. For purposes of this definition, "control" means the power, directly
or indirectly, to cause the direction of the management and policies of a
Person.
"Authenticating Agent" means any Person authorized by the Indenture Trustee
to act on behalf of the Indenture Trustee to authenticate and deliver the Notes.
"Authorized Newspaper" means a newspaper of general circulation in The City
of New York, printed in the English language and customarily published on each
Business Day, whether or not published on Saturdays, Sundays and holidays.
"Authorized Officer" means (a) with respect to the Issuer, (i) any officer
of the Owner Trustee who is authorized to act for the Owner Trustee in matters
relating to the Issuer and who is identified on the list of Authorized Officers
delivered by the Owner Trustee to the Indenture Trustee on the Closing Date (as
such list may be modified or supplemented from time to time thereafter) and (ii)
so long as the Administration Agreement is in effect, any officer of the
Administrator who is authorized to act for the Administrator in matters relating
to the Issuer pursuant to the Administration Agreement and who is identified on
the list of Authorized Officers delivered by the Administrator to the Owner
Trustee and the Indenture Trustee on the Closing Date (as such list may be
modified or supplemented from time to time thereafter) and (b) with respect to
the Owner Trustee, the Indenture Trustee and the Servicer, any officer of the
Owner Trustee, the Indenture Trustee or the Servicer, as applicable, who is
authorized to act for the Owner Trustee, the Indenture Trustee or the Servicer,
as applicable, in matters relating to the Owner Trustee, the Indenture Trustee
or the Servicer and who is identified on the list of Authorized Officers
delivered by each of the Owner Trustee, the Indenture Trustee and the Servicer
to the Indenture Trustee on the Closing Date (as such list may be modified or
supplemented from time to time thereafter).
"Available Funds" means, for any Payment Date and the related Collection
Period, an amount equal to the sum of the following amounts: (i) the Collections
received by the Servicer during such Collection Period, (ii) Advances made by
the Servicer on such Payment Date, (iii) any amounts paid with respect to such
Payment Date by VCI to the Issuer in accordance with Section 2.3 of the SUBI
Sale Agreement or by the Servicer to the Issuer in accordance with Section 7.12
of the Transaction SUBI Servicing Supplement, and (iv) all investment earnings
(if any) on amounts on deposit in the Collection Account for the related
Collection Period.
"Available Funds Shortfall Amount" has the meaning set forth in Section
8.4(c) of the Indenture.
"Bankruptcy Event" means, for any Person, that such Person makes a general
assignment for the benefit of creditors or any proceeding is instituted by or
against such Person seeking to
2
adjudicate it bankrupt or insolvent, or seeking the liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief or composition of it
or its debts under any law relating to bankruptcy, insolvency or reorganization
or relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee or other similar official for it or any
substantial part of its property and, in the case of any proceeding instituted
against such Person, such proceeding remains unstayed for more than 90 days.
"Bankruptcy Remote Party" means any of the Transferor, the Issuer, the
Origination Trust or any Special Purpose Entity (and the general partner of any
Special Purpose Entity that is a partnership, or the managing member of any
Special Purpose Entity that is a limited liability company) that holds a
beneficial interest in the Origination Trust.
"Base Residual Value" means, for each Leased Vehicle related to an Included
Unit, the lowest of (a) the MSRP ALG Residual of the related Vehicle, (b) the
Maximum Residualized MSRP ALG Residual of the related Vehicle and (c) the Stated
Residual Value of the related Vehicle.
"Benefit Plan" means (i) any "employee benefit plan" whether or not subject
to ERISA, (ii) a "plan" described by Section 4975(e)(1) of the Code or (iii) any
entity deemed to hold the assets of any of the foregoing by reason of an
employee benefit plan's or other plan's investment in such entity.
"Book-Entry Notes" means a beneficial interest in the Notes, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 2.9 of the Indenture.
"Business Day" means any day other than a Saturday, a Sunday or a day on
which banking institutions in the states of Delaware, Illinois, Michigan, or New
York are authorized or obligated by law, executive order or government decree to
be closed.
"Casualty" means, with respect to any Transaction Unit, that the Servicer
has actual knowledge that the Vehicle included in such Unit (a) shall have
suffered damage or destruction resulting in an insurance settlement on the basis
of an actual, constructive or compromised total loss, (b) shall have suffered
destruction or damage beyond repair, (c) shall have suffered damage that makes
repairs uneconomic or (d) shall have suffered destruction, damage, theft, loss
or disappearance that, in accordance with Customary Servicing Practices, results
in a termination of the related User Lease.
"Certificate" means a certificate evidencing the beneficial interest of the
Certificateholder in the Issuer, substantially in the form of Exhibit A to the
Trust Agreement.
"Certificateholder" means the registered holder of the Certificate.
"Class" means a group of Notes whose form is identical except for variation
in denomination, principal amount or owner, and references to "each Class" thus
mean each of the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class A-4 Notes.
3
"Class A-1 Interest Rate" means [_____]% per annum (computed on the basis
of the actual number of days elapsed, but assuming a 360-day year of twelve
30-day months).
"Class A-1 Note Balance" means, as of any date, the Initial Class A-1 Note
Balance reduced by all payments of principal made on or prior to such date on
the Class A-1 Notes.
"Class A-1 Noteholders' Interest Carryover Shortfall" means, with respect
to any Payment Date, the excess of the Class A-1 Noteholders' Monthly Accrued
Interest for the preceding Payment Date and any outstanding Class A-1
Noteholders' Interest Carryover Shortfall on such preceding Payment Date, over
the amount in respect of interest that is actually paid to Holders of Class A-1
Notes on such preceding Payment Date, plus interest on the amount of interest
due but not paid to Holders of Class A-1 Notes on the preceding Payment Date, to
the extent permitted by law, at the Class A-1 Interest Rate for the related
Interest Period.
"Class A-1 Noteholders' Monthly Accrued Interest" means, with respect to
any Payment Date, the aggregate interest accrued for the related Interest Period
on the Class A-1 Notes at the Class A-1 Interest Rate on the Class A-1 Note
Balance on the immediately preceding Payment Date or the Closing Date, as the
case may be, after giving effect to all payments of principal to the Holders of
the Class A-1 Notes on or prior to such preceding Payment Date.
"Class A-1 Notes" means the Class of Auto Lease Asset Backed Notes
designated as Class A-1 Notes, issued in accordance with the Indenture.
"Class A-2 Interest Rate" means [_____]% per annum (computed on the basis
of a 360-day year of twelve 30-day months).
"Class A-2 Note Balance" means, as of any date, the Initial Class A-2 Note
Balance reduced by all payments of principal made on or prior to such date on
the Class A-2 Notes.
"Class A-2 Notes" means the Class of Auto Lease Asset Backed Notes
designated as Class A-2 Notes, issued in accordance with the Indenture.
"Class A-2 Noteholders' Interest Carryover Shortfall" means, with respect
to any Payment Date, the excess of the Class A-2 Noteholders' Monthly Accrued
Interest for the preceding Payment Date and any outstanding Class A-2
Noteholders' Interest Carryover Shortfall on such preceding Payment Date, over
the amount in respect of interest that is actually paid to Holders of the Class
A-2 Notes on such preceding Payment Date, plus interest on the amount of
interest due but not paid to Holders of the Class A-2 Notes on the preceding
Payment Date, to the extent permitted by law, at the Class A-2 Interest Rate for
the related Interest Period.
"Class A-2 Noteholders' Monthly Accrued Interest" means, with respect to
any Payment Date, the sum of the aggregate interest accrued for the related
Interest Period on the Class A-2 Notes at the Class A-2 Interest Rate on the
Class A-2 Note Balance immediately preceding the Payment Date or the Closing
Date, as the case may be, after giving effect to all payments of principal to
the Holders of the Class A-2 Notes on or prior to such preceding Payment Date.
"Class A-3 Interest Rate" means [_____]% per annum (computed on the basis
of a 360-day year of twelve 30-day months).
4
"Class A-3 Note Balance" means, as of any date, the Initial Class A-3 Note
Balance reduced by all payments of principal made on or prior to such date on
the Class A-3 Notes.
"Class A-3 Notes" means the Class of Auto Lease Asset Backed Notes
designated as Class A-3 Notes, issued in accordance with the Indenture.
"Class A-3 Noteholders' Interest Carryover Shortfall" means, with respect
to any Payment Date, the excess of the Class A-3 Noteholders' Monthly Accrued
Interest for the preceding Payment Date and any outstanding Class A-3
Noteholders' Interest Carryover Shortfall on such preceding Payment Date, over
the amount in respect of interest that is actually paid to Holders of the Class
A-3 Notes on such preceding Payment Date, plus interest on the amount of
interest due but not paid to Holders of the Class A-3 Notes on the preceding
Payment Date, to the extent permitted by law, at the Class A-3 Interest Rate for
the related Interest Period.
"Class A-3 Noteholders' Monthly Accrued Interest" means, with respect to
any Payment Date, the sum of the aggregate interest accrued for the related
Interest Period on the Class A-3 Notes at the Class A-3 Interest Rate on the
Class A-3 Note Balance immediately preceding the Payment Date or the Closing
Date, as the case may be, after giving effect to all payments of principal to
the Noteholders of the Class A-3 Notes on or prior to such preceding Payment
Date.
"Class A-4 Interest Rate" means [_____]% per annum (computed on the basis
of a 360-day year of twelve 30-day months).
"Class A-4 Note Balance" means, as of any date, the Initial Class A-4 Note
Balance reduced by all payments of principal made on or prior to such date on
the Class A-4 Notes.
"Class A-4 Notes" means the Class of Auto Lease Asset Backed Notes
designated as Class A-4 Notes, issued in accordance with the Indenture.
"Class A-4 Noteholders' Interest Carryover Shortfall" means, with respect
to any Payment Date, the excess of the Class A-4 Noteholders' Monthly Accrued
Interest for the preceding Payment Date and any outstanding Class A-4
Noteholders' Interest Carryover Shortfall on such preceding Payment Date, over
the amount in respect of interest that is actually paid to Noteholders of the
Class A-4 Notes on such preceding Payment Date, plus interest on the amount of
interest due but not paid to Noteholders of the Class A-4 Notes on the preceding
Payment Date, to the extent permitted by law, at the Class A-4 Interest Rate for
the Class A-4 Notes for the related Interest Period.
"Class A-4 Noteholders' Monthly Accrued Interest" means, with respect to
any Payment Date, the sum of the aggregate interest accrued for the related
Interest Period on the Class A-4 Notes at the Class A-4 Interest Rate on the
Class A-4 Note Balance immediately preceding the Payment Date or the Closing
Date, as the case may be, after giving effect to all payments of principal to
the Noteholders of the Class A-4 Notes on or prior to such preceding Payment
Date.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act and shall initially be DTC.
5
"Clearing Agency Participant" means a broker, dealer, bank or other
financial institution or other Person for which from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means [_______], [____].
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor law, and the Treasury Regulations promulgated thereunder.
"Collateral" has the meaning set forth in the Granting Clause of the
Indenture.
"Collection Account" means the trust account designated as such established
and maintained pursuant to Section 8.2(b) of the Indenture.
"Collection Period" means the period commencing on the first day of each
fiscal month and ending on the last day of such fiscal month (or, in the case of
the initial Collection Period, the period commencing on the close of business on
the Cut-Off Date and ending on [___________]). As used herein, the "related"
Collection Period with respect to a Payment Date shall be deemed to be the
Collection Period which precedes such Payment Date.
"Collections" means, with respect to any Collection Period, an amount equal
to the following, but only to the extent relating solely to the Transaction SUBI
Portfolio: (a) all monthly lease payments on any Lease, (b) Sales Proceeds (it
being understood that, with respect to Sales Proceeds, the Servicer shall not be
obligated to remit the actual Sales Proceeds but instead such actual Sales
Proceeds shall be held by the Qualified Intermediary or in a Qualified
Intermediary Account which shall not constitute Collateral) in respect of any
Leased Vehicle, (c) Excess Wear and Tear Charges, Excess Mileage Charges and any
other payments, receipts or Recoveries (including any residual value insurance
proceeds and other insurance proceeds) by or on behalf of any Lessee or
otherwise with respect to any Unit and (d) all Pull-Ahead Amounts with respect
to any Lease; provided that the term "Collections" shall not include (i)
Supplemental Servicing Fees, (ii) payments allocable to sales, use or other
taxes (which shall be collected by the Servicer and remitted to the applicable
Governmental Authority or used to reimburse the Servicer for payment of such
amounts in accordance with Customary Servicing Practices), (iii) payments
allocable to premiums for force-placed insurance policies purchased by the
Servicer on behalf of any Lessee (which shall be collected by the Servicer and
remitted to the applicable insurance company (or if such amounts were paid by
the Servicer, to the Servicer) in accordance with Customary Servicing
Practices), (iv) payments allocable to fines for parking violations incurred by
any Lessee but assessed to the Origination Trust as the owner of the related
Vehicle (which shall be collected by the Servicer and remitted to the applicable
Governmental Authority (or if such amounts were paid by the Servicer, to the
Servicer) in accordance with Customary Servicing Practices) and (v) rebates of
premiums with respect to the cancellation of any insurance policy or service
contract.
"Commission" means the U.S. Securities and Exchange Commission.
"Corporate Trust Office" means:
6
(a) as used in the Indenture, or otherwise with respect to Indenture
Trustee, the principal office of the Indenture Trustee at which at any
particular time its corporate trust business shall be administered which office
at date of the execution of the Indenture is located at [____________], or at
such other address as the Indenture Trustee may designate from time to time by
notice to the Noteholders, the Administrator, the Servicer and the Issuer, or
the principal corporate trust office of any successor Indenture Trustee (the
address of which the successor Indenture Trustee will notify the Noteholders and
the Owner Trustee); and
(b) as used in the Trust Agreement, or otherwise with respect to Owner
Trustee, the corporate trust office of the Owner Trustee located at
[____________], or at such other address as the Owner Trustee may designate by
notice to the Certificateholder and the Transferor, or the principal corporate
trust office of any successor Owner Trustee (the address of which the successor
Owner Trustee will notify the Certificateholder and the Transferor).
"Credit Losses" means, for any Collection Period, an amount equal to the
excess of (a) the sum of the Securitization Value for all Included Units
charged-off (i.e., that became Terminated Units before maturity of the related
Lease and for which all scheduled payments thereunder have not been made) during
that Collection Period over (b) the sum of Sales Proceeds and Recoveries
received by the Servicer with respect to charged-off Units during that
Collection Period.
"Cumulative Net Credit Losses" means, through any Collection Period, the
sum of the Credit Losses for all Collection Periods from and including the
Cut-Off Date to and including such Collection Period.
"Cumulative Net Residual Losses" means, through any Collection Period, the
sum (which number may be positive or negative) of the Residual Losses for all
Collection Periods from and including the Cut-Off Date to and including such
Collection Period.
"Customary Servicing Practices" means the customary practices of the
Servicer with respect to Vehicles and Leases held by the Origination Trust,
without regard to whether such Vehicles and Leases have been identified and
allocated into a SUBI Portfolio, as such practices may be changed from time to
time.
"Cut-Off Date" means the close of business on [______________],[_____].
"Dealer" means a motor vehicle dealership in the VCI dealer network.
"Default" means any occurrence that is, or with notice or lapse of time or
both would become, an Indenture Default.
"Defaulted Unit" means any Unit with a related Lease for which any of the
following has occurred during a Collection Period: (a) any payment on such Lease
is past due 90 or more days, (b) the related Vehicle has been repossessed but
has not been charged off or (c) such related Lease has been charged off in
accordance with Customary Servicing Practices.
"Definitive Note" means a definitive fully registered Note issued pursuant
to Section 2.11 of the Indenture.
7
"Delaware Trustee" means Wilmington Trust Company, as Delaware Trustee
under the Origination Trust Agreement.
"Delinquent Unit" means any Transaction Unit (other than a Defaulted Unit)
with a related Transaction Lease on which any payment is past due for more than
30 days.
"Depository Agreement" means the agreement among the Issuer, the Indenture
Trustee and DTC, as the initial Clearing Agency, dated as of the Closing Date,
substantially in the form of Exhibit B to the Indenture.
"Determination Date" means the second Business Day preceding the related
Payment Date, beginning [___________], [____].
"Dollar" and "$" mean lawful currency of the United States of America.
"DTC" means The Depository Trust Company, and its successors.
"Eligible Account" means either (a) a segregated account with an Eligible
Institution or (b) a segregated trust account with the corporate trust
department of a depository institution acting in its fiduciary capacity
organized under the laws of the United States of America or any one of the
states thereof or the District of Columbia (or any domestic branch of a foreign
bank), having corporate trust powers and acting as trustee for funds deposited
in such account, so long as the long-term unsecured debt of such depository
institution shall have a credit rating from each Rating Agency in one of its
generic rating categories which signifies investment grade. Any such trust
account may be maintained with the Owner Trustee, the Indenture Trustee or any
of their respective Affiliates, if such accounts meet the requirements described
in clause (b) of the preceding sentence.
"Eligible Institution" means a depository institution or trust company
(which may be the Owner Trustee, the Indenture Trustee or any of their
respective Affiliates) organized under the laws of the United States of America
or any one of the states thereof or the District of Columbia (or any domestic
branch of a foreign bank) (a) which at all times (i) has either (A) a long-term
senior unsecured debt rating of "Aa2" or better by Moody's and "AA-" or better
by Standard & Poor's or such other rating that is acceptable to each Rating
Agency, as evidenced by a letter from such Rating Agency to the Issuer or the
Indenture Trustee or (B) a certificate of deposit rating of "P-1" by Moody's and
"A-1+" by Standard & Poor's or (C) such other rating that is acceptable to each
Rating Agency, as evidenced by a letter from such Rating Agency to the Issuer or
the Indenture Trustee and (b) whose deposits are insured by the Federal Deposit
Insurance Corporation.
"Eligible Unit" means, at the Cut-Off Date, a Unit:
(a) which was originated out of the lease of a new Vehicle;
(b) the Lessee of which (a) is a resident of, or organized under the
laws of and with its chief executive office in, the USA, (b) is not an Affiliate
of VCI, (c) is not a government or a governmental subdivision or agency, (d) is
not shown on the Servicer's records as a debtor in a pending bankruptcy
proceeding and (e) is not the Lessee of any Defaulted Unit;
8
(c) for which the related Lease requires substantially equal monthly
payments;
(d) for which the related Lease has a remaining lease term less than
60 months and had an original lease term greater than 12 months and less than or
equal to 72 months;
(e) for which the related Lease is an "account" or "chattel paper"
within the meaning of Section 9-102 of the UCC of all applicable jurisdictions;
(f) for which the related Lease is denominated and payable only in
Dollars;
(g) for which the related Lease constitutes the legal, valid and
binding obligation of the related Lessee enforceable against such Lessee in
accordance with its terms subject to no offset, counterclaim, defense or other
Adverse Claim;
(h) for which the related Lease arises under a contract that does not
require the Lessee under such contract to consent to the transfer, sale or
assignment of the rights of the Origination Trust under such contract;
(i) which does not, in whole or in part, materially contravene any
law, rule or regulation applicable thereto (including, without limitation, those
relating to usury, truth in lending, fair credit billing, fair credit reporting,
equal credit opportunity, fair debt collection practices and privacy);
(j) which has a Securitization Value not greater than $[__________];
(k) which was generated in the ordinary course of the Origination
Trust's business;
(l) which is not a Delinquent Unit or a Defaulted Unit;
(m) for which the related Lease provides for level payments that fully
amortize the adjusted capitalized cost of such Lease to the related Stated
Residual Value over the term of such Lease;
(n) which was originated in compliance with Customary Servicing
Practices;
(o) for which there is only one original of the related Lease, which
is held by the Servicer on behalf of the Origination Trust;
(p) for which there is no credit-related recourse to the related
Dealer;
(q) for which the related Lease was originated on or after
[____________];
(r) for which the related Lease is in full force and effect, and has
not been satisfied, subordinated or rescinded;
9
(s) for which the related Lease requires the related Lessee to obtain
physical damage insurance covering the related Vehicle in accordance with
Customary Servicing Practices;
(t) for which the related Vehicle is a Volkswagen brand or Audi brand
Vehicle; and
(u) for which the related Lease was originated in compliance, and
complies in all material respects, with all material applicable legal
requirements.
"End User" means, with respect to each Lease, the lessee thereunder.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" means at any time, with respect to any Person or entity,
any member of such Person's or entity's "controlled group", within the meaning
of Section 4001 of ERISA or Section 414(b), (c), (m) or (o) of the Code.
"Event of Loss" means, with respect to any Transaction Unit, a Casualty
with respect to the Vehicle included in such Unit.
"Excess Mileage Charges" means, with respect to any Unit, the amount of
charges for excess mileage on the related Vehicle received from the Lessee at
the expiration of the Lease.
"Excess Wear and Tear Charges" means, with respect to any Unit, the amount
of charges for wear and tear to the related Vehicle received from the Lessee at
the expiration of the Lease.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Executive Officer" means (i) with respect to any corporation or depository
institution, the Chief Executive Officer, the Chief Operating Officer, the Chief
Financial Officer, the President, the Executive Vice President, any Vice
President, the Secretary or the Treasurer of such corporation or depository
institution and (ii) with respect to any partnership, any general partner
thereof.
"Final Scheduled Payment Date" means, with respect to (i) the Class A-1
Notes, [______], [______]; (ii) the Class A-2 Notes, [______], [______]; (iii)
the Class A-3 Notes, [______], [______]; and (iv) the Class A-4 Notes, [______],
[______].
"Financing" means, collectively, (i) any financing transaction of any sort
undertaken by VCI or any Affiliate of VCI involving, directly or indirectly,
Origination Trust Assets (including, without limitation, any financing
undertaken in connection with the issuance and assignment of any SUBI and
related SUBI Certificate), (ii) any sale or purchase by the Transferor or any
other Special Purpose Entity of any interest in one or more SUBIs and (iii) any
other asset securitization, synthetic lease, sale-leaseback, secured loan or
similar transaction involving Origination Trust Assets or any beneficial
interest therein or in the Origination Trust.
10
"First Priority Principal Distribution Amount" means, with respect to any
Payment Date, an amount not less than zero, equal to (a) the Outstanding Amount
of the Notes as of the preceding Payment Date (after giving effect to any
principal payments made on the Notes on such preceding Payment Date), minus (b)
the aggregate Securitization Value at the end of the Collection Period preceding
such Payment Date; provided, however, that the First Priority Principal
Distribution Amount on and after the Final Scheduled Payment Date of any class
of the Notes shall not be less than the amount that is necessary to reduce the
Outstanding Amount of that Class of Notes to zero.
"GAAP" means generally accepted accounting principles in the USA, applied
on a materially consistent basis; provided, however, that no financial test
contained in the Transaction Documents shall fail to be satisfied as a result of
the adoption or amendment (including any published interpretation) after the
Closing Date by any governmental or accounting body of any financial accounting
standard, and any notices, representations or certifications based on financial
accounting data that are required under the Transaction Documents may be
delivered without giving effect to the adoption or amendment of such financial
accounting standard.
"Governmental Authority" means any (a) Federal, state, municipal, foreign
or other governmental entity, board, bureau, agency or instrumentality, (b)
administrative or regulatory authority (including any central bank or similar
authority) or (c) court or judicial authority.
"Grant" means to mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, grant a lien upon and a
security interest in and right of set-off against, deposit, set over and confirm
pursuant to the Indenture. A Grant of the 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, collect, receive and give receipt for principal and
interest payments in respect of the 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. Other forms of the verb "to Grant"
shall have correlative meanings.
"Holder" means, as the context may require, the Certificateholder or a
Noteholder or both.
"Included Units" means, for any Collection Period, all Transaction Units as
of the beginning of such Collection Period (or, in the case of the initial
Collection Period, the Closing Date), other than Units the beneficial interest
in which were repurchased by VCI during such Collection Period pursuant to
Section 2.3 of the SUBI Sale Agreement. The "Included Units" for any Cut-Off
Date means the Included Units for the Collection Period which begins on the day
after such Cut-Off Date.
"Indenture" means the Indenture, dated as of the Closing Date, between the
Issuer and Indenture Trustee, as the same may be amended and supplemented from
time to time.
"Indenture Default" has the meaning set forth in Section 5.1 of the
Indenture.
11
"Indenture Secured Parties" means the Noteholders.
"Indenture Trustee" means [_________________], [a national banking
association], not in its individual capacity but as indenture trustee under the
Indenture, or any successor trustee under the Indenture.
"Independent" means, when used with respect to any specified Person, that
such Person (i) is in fact independent of the Issuer, any other obligor upon the
Notes, the Administrator and any Affiliate of any of the foregoing Persons, (ii)
does not have any direct financial interest or any material indirect financial
interest in the Issuer, any such other obligor, the Administrator or any
Affiliate of any of the foregoing Persons and (iii) is not connected with the
Issuer, any such other obligor, the Administrator 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 Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.1(b) of the Indenture,
made by an independent appraiser or other expert appointed by an Issuer Order,
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.
"Initial Beneficiary" means VCI, as initial beneficiary under the
Origination Trust Agreement and its permitted successors and assigns.
"Initial Class A-1 Note Balance" means $[__________].
"Initial Class A-2 Note Balance" means $[__________].
"Initial Class A-3 Note Balance" means $[__________].
"Initial Class A-4 Note Balance" means $[__________].
"Initial Note Balance" means, for any Class, the Initial Class A-1 Note
Balance, the Initial Class A-2 Note Balance, the Initial Class A-3 Note Balance,
the Initial Class A-4 Note Balance, as applicable, or with respect to the Notes
generally, the sum of the foregoing.
"Initial Securitization Value" means $[___________].
"Initial Trust Agreement" means the Trust Agreement, dated as of
[____________], [_____], between the Transferor and the Owner Trustee.
"Insurance Policy" means (i) any comprehensive and collision, fire, theft
or other insurance policy maintained by a Lessee in which the Servicer or the
Origination Trust is named as loss payee with respect to one or more Transaction
Units and (ii) any credit life or credit disability insurance maintained by a
Lessee in connection with any Transaction Unit.
12
"Interest Period" means, with respect to any Payment Date, from and
including the Closing Date (in the case of the first Payment Date) or from and
including the most recent Payment Date to but excluding that Payment Date.
"Interest Rate" means (a) with respect to the Class A-1 Notes, the Class
A-1 Interest Rate, (b) with respect to the Class A-2 Notes, the Class A-2
Interest Rate, (c) with respect to the Class A-3 Notes, the Class A-3 Interest
Rate or (d) with respect to the Class A-4 Notes, the Class A-4 Interest Rate.
"Issuer" means Volkswagen Auto Lease Trust 20[__]-[__], a Delaware
statutory trust established pursuant to the Initial Trust Agreement and
continued under the Trust Agreement, 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 of the
Issuer signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Indenture Trustee.
"Lease" means a lease of a Vehicle.
"Lessee" means, with respect to each Lease, the lessee thereunder.
"Lien" means any mortgage, pledge, security interest, lien or other
encumbrance of any kind.
"Maximum Residualized MSRP ALG Residual" means, with respect to any Lease,
the residual value estimate produced by Automotive Lease Guide that is a
percentage of the "Maximum Residualizable MSRP," which consists of the MSRP of
the typically equipped vehicle and value adding options, giving only partial
credit or no credit for those options that add little or no value to the resale
price of the vehicle.
"Monthly Remittance Condition" has the meaning set forth in Section 7.3 of
the Transaction SUBI Servicing Supplement.
"Moody's" means Moody's Investors Service, Inc., or any successor that is a
nationally recognized statistical rating organization.
"MSRP" means, with respect to any Vehicle, the Manufacturer's Suggested
Retail Price for such Vehicle.
"MSRP ALG Residual" means, with respect to any Lease, residual value
estimates produced by Automotive Lease Guide based on the total MSRP of the base
vehicle and all VCI authorized options, without making a distinction between the
value adding options and non-value adding options.
"Note" means a Class A-1 Note, Class A-2 Note, Class A-3 Note or Class A-4
Note, in each case substantially in the form of Exhibit A to the Indenture.
13
"Note Balance" means, for any Class, the Class A-1 Note Balance, the Class
A-2 Note Balance, the Class A-3 Note Balance or the Class A-4 Note Balance, as
applicable, or with respect to the Notes generally, the sum of the foregoing.
"Note Factor" means, with respect to the Notes or any Class on any Payment
Date, the seven digit decimal equivalent of a fraction the numerator of which is
the Note Balance of the Notes of such Class on such Payment Date (after giving
effect to any payment of principal on such Payment Date) and the denominator of
which is the Initial Note Balance.
"Noteholder" means, as of any date, the Person in whose name a Note is
registered on the Note Register on such date.
"Note Owner" means, with respect to a Book-Entry Note, the Person who is
the beneficial owner of such Book-Entry Note, as reflected on the books of the
Clearing Agency or a Person maintaining an account with such Clearing Agency
(directly as a Clearing Agency Participant or as an indirect participant, in
each case in accordance with the rules of such Clearing Agency).
"Note Register" and "Note Registrar" have the respective meanings set forth
in Section 2.4 of the Indenture.
"Officer's Certificate" means a certificate signed by an Authorized Officer
of the Issuer, under the circumstances described in, and otherwise complying
with, the applicable requirements of Section 11.1 of the Indenture, and
delivered to, the Indenture Trustee.
"Opinion of Counsel" means one or more written opinions of counsel who may,
except as otherwise expressly provided in the Indenture or any other applicable
Transaction Document, be employees of or counsel to the Issuer or the
Administrator, and who shall be satisfactory to the Indenture Trustee, and which
opinion or opinions comply with any applicable requirements of the Transaction
Documents and are in form and substance reasonably satisfactory to the
recipient(s). Opinions of Counsel need address matters of law only and may be
based upon stated assumptions as to relevant matters of fact.
"Optional Purchase" has the meaning set forth in Section 9.4 of the Trust
Agreement.
"Optional Purchase Price" has the meaning set forth in Section 9.4 of the
Trust Agreement.
"Origination Trust" means VW Credit Leasing, Ltd., a Delaware statutory
trust formed under the Statutory Trust Act.
"Origination Trust Agreement" means the Trust Agreement, dated as of June
2, 1999, among VCI as Settlor and Initial Beneficiary, Wilmington Trust Company,
as Delaware Trustee, and U.S. Bank, as Administrative Trustee and UTI Trustee,
as amended, supplemented and modified by the Transaction SUBI Supplement and as
the same may be further amended supplemented or modified from time to time.
14
"Origination Trust Assets" means, at any time, all assets owned by the
Origination Trust at such time.
"Origination Trust Documents" means the Origination Trust Agreement, the
Transaction SUBI Supplement, the Servicing Agreement (including the Transaction
SUBI Servicing Supplement), the Transaction SUBI Certificate and all amendments
or modifications thereto.
"Origination Trustees" means, collectively, the SUBI Trustee, the UTI
Trustee, the Administrative Trustee and the Delaware Trustee.
"Other SUBI" means any special unit of beneficial interest in the
Origination Trust other than the Transaction SUBI.
"Other SUBI Assets" means the Origination Trust Assets allocated to any
SUBI other than the Transaction SUBI.
"Other SUBI Certificate" means a certificate of beneficial ownership
representing beneficial ownership of the Origination Trust Assets allocated to
any SUBI other than the Transaction SUBI.
"Other SUBI Portfolio" means a portfolio of Origination Trust Assets other
than the Transaction SUBI Portfolio.
"Other SUBI Trustee" means the trustee of any Other SUBI appointed under
Section 4.2(d) of the Origination Trust Agreement.
"Outstanding" means, as of any date, all Notes (or all Notes of an
applicable Class) theretofore authenticated and delivered under this Indenture
except:
(i) Notes (or Notes of an applicable Class) theretofore cancelled by
the Note Registrar or delivered to the Note Registrar for cancellation;
(ii) Notes (or Notes of an applicable Class) or portions thereof the
payment for which money in the necessary amount has been theretofore deposited
with the Indenture Trustee or any Paying Agent in trust for the related
Noteholders (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 Indenture Trustee, has been made); and
(iii) Notes (or Notes of an applicable Class) in exchange for or in
lieu of other Notes (or Notes of such Class) that have been authenticated and
delivered pursuant to this Indenture unless proof satisfactory to the Indenture
Trustee is presented that any such Notes are held by a bona fide purchaser;
provided that in determining whether Noteholders holding the requisite
Outstanding Note Amount have given any request, demand, authorization,
direction, notice, consent or waiver hereunder or under any Transaction
Document, Notes owned by the Issuer, the Transferor, the Servicer, the
Administrator or any of their respective Affiliates shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the Indenture
Trustee shall be
15
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Notes that a Responsible Officer 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 thereof establishes to the
satisfaction of the Indenture Trustee such pledgee's right so to act with
respect to such Notes and that such pledgee is not the Issuer, the Transferor,
the Administrator or any of their respective Affiliates.
"Outstanding Amount" or "Outstanding Note Amount" means the aggregate
principal amount of all Notes, or Class of Notes, as applicable, Outstanding at
the date of determination.
"Owner Trustee" means [___________], a [Delaware banking corporation], not
in its individual capacity but solely as owner trustee under the Trust
Agreement, and any successor Owner Trustee thereunder.
"Paying Agent" means the Indenture Trustee or any other Person that meets
the eligibility standards for the Indenture Trustee set forth in Section 6.11 of
the Indenture and is authorized by the Issuer to make the payments to and
distributions from the Collection Account, including the payment of principal of
or interest on the Notes on behalf of the Issuer.
"Payment Date" means the [20th]day of each calendar month; provided,
however, whenever a Payment Date would otherwise be a day that is not a Business
Day, the Payment Date shall be the next Business Day; provided, further, that
the initial Payment Date shall be [___________], [_____]. As used herein, the
"related" Payment Date with respect to a Collection Period shall be deemed to be
the Payment Date which follows such Collection Period.
"Payment Date Advance Reimbursement" means, with respect to any Payment
Date, an amount equal to the sum of all outstanding Advances made by the
Servicer prior to such Payment Date.
"Permitted Investments" means (a) evidences of indebtedness, maturing
within thirty (30) days after the date of loan thereof, issued by, or guaranteed
by the full faith and credit of, the federal government of the USA, (b)
repurchase agreements with banking institutions or broker-dealers registered
under the Securities Exchange Act of 1934 which are fully secured by obligations
of the kind specified in clause (a), (c) money market funds (i) rated not lower
than the highest rating category from Moody's and "AAA m" or "AAAm-g" from
Standard & Poor's or (ii) which are otherwise acceptable to each Rating Agency,
as evidenced by a letter from such Rating Agency to the Issuer or the Indenture
Trustee or (d) commercial paper issued by any corporation incorporated under the
laws of the USA and rated at least "A-1+" (or the equivalent) by Standard &
Poor's and at least "P-1" (or the equivalent) by Moody's.
"Permitted Lien" means (1) with respect to any Unit (a) the interests of
the parties under the Transaction Documents; (b) the interests of the
Origination Trust and any Lessee as provided in any Lease; (c) any liens thereon
for taxes, assessments, levies, fees and other government and similar charges
not due and payable or the amount or validity of which is being contested in
good faith by appropriate proceedings; (d) any liens of mechanics, suppliers,
vendors, materialmen, laborers, employees, repairmen and other like liens
arising in the ordinary course of the Servicer's, the Issuer's or the
Origination Trust's (or if a Lease is then in effect, any
16
Lessee's) business securing obligations which are not due and payable or the
amount or validity of which is being contested in good faith by appropriate
proceedings; (e) liens arising out of any judgment or award against the
Transferor or the Origination Trust (or if a Lease is then in effect, any
Lessee) with respect to which an appeal or proceeding for review is being taken
in good faith and with respect to which there shall have been secured a stay of
execution pending such appeal or proceeding for review; and (f) any lien of the
Origination Trust noted on the certificate of title of the Vehicle included in
such Unit for the sole purpose of causing the certificate of title for such
Vehicle to be returned or otherwise delivered to the Transferor, the Servicer or
the Origination Trust from the relevant registrar of titles and which does not
convey to the Origination Trust any other rights with respect to such Vehicle;
and (2) with respect to any SUBI or SUBI Certificate, the type of liens
described in subclauses (a), (c) and (e) of the foregoing clause (1).
"Person" means any individual, corporation, limited liability company,
estate, partnership, joint venture, association, joint stock company, trust
(including any beneficiary thereof), unincorporated organization or government
or any agency or political subdivision thereof.
"Postmaturity Term Extension" means, with respect to any Included Unit,
that the Servicer has granted an extension of the term of the related Lease, and
the Lease term as so extended ends beyond the Collection Period preceding the
Final Scheduled Payment Date for the Class A-4 Notes.
"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; provided, however, for the purpose of this definition, any
Note authenticated and delivered under Section 2.5 of the Indenture in lieu of a
mutilated, destroyed, lost or stolen Note shall be deemed to evidence the same
debt as the mutilated, destroyed, lost or stolen Note.
"Principal Distribution Account" means the account designated as such,
established and maintained pursuant to Section 8.2(c) of the Indenture.
"Proceeding" means any suit in equity, action at law or other judicial or
administrative proceeding.
"Pull-Ahead Amount" means, with respect to any Included Unit and the
related Lease, an amount equal to (a) the sum of (i) any due and unpaid payments
under such Lease, plus (ii) the monthly payment amount times the number of
monthly payments not yet due with respect to such Lease, minus (b) any unearned
rent charges calculated under the scheduled actuarial method under such Lease.
"Qualified Intermediary" means any Person acting as a "qualified
intermediary" for VCI's like-kind exchange program pursuant to Section
1.1031(k)-1(g)(4) of the Treasury Regulations promulgated under the Code.
"Qualified Intermediary Account" means each account established by the
Qualified Intermediary used to receive or hold funds in connection with VCI's
like-kind exchange program.
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"Rating Agency" means either Moody's or Standard & Poor's, as the context
may require. If neither Moody's nor Standard & Poor's nor a successor thereto
remains in existence, "Rating Agency" shall mean any nationally recognized
statistical rating organization or other comparable Person designated by the
Transferor, notice of which shall be given to the Indenture Trustee, the Owner
Trustee and the Servicer.
"Rating Agency Condition" means, with respect to any event and each Rating
Agency, either (a) written confirmation by such Rating Agency that the
occurrence of such event will not cause it to downgrade, qualify or withdraw its
rating assigned to the Notes or (b) that such Rating Agency shall have been
given notice of such event at least ten (10) days prior to such event (or, if
(10) days' advance notice is impracticable, as much advance notice as is
practicable) and such rating agency shall not have issued any written notice
that the occurrence of such event will cause it to downgrade, qualify or
withdraw its rating assigned to the Notes. Notwithstanding the foregoing, no
Rating Agency has any duty to review any notice given with respect to any event,
and it is understood that such Rating Agency may not actually review notices
received by it prior to or after the expiration of the ten (10) day period
described in (b) above. Further, each Rating Agency retains the right to
downgrade, qualify or withdraw its rating assigned to all or any of the Notes at
any time in its sole judgment even if the Rating Agency Condition with respect
to an event had been previously satisfied pursuant to clause (a) or clause (b)
above.
"Record Date" means, unless otherwise specified in any Transaction
Document, with respect to any Payment Date or Redemption Date, (i) for any
Definitive Notes and for the Certificates, the close of business on the last
Business Day of the calendar month immediately preceding the calendar month in
which such Payment Date or Redemption Date occurs and (ii) for any Book-Entry
Notes, the close of business on the Business Day immediately preceding such
Payment Date or Redemption Date.
"Records" means, for any Transaction Unit, all contracts, books, records
and other documents or information (including computer programs, tapes, disks,
software and related property and rights, to the extent legally transferable)
relating to such Transaction Unit or the related Lessee.
"Recoveries" means, with respect to any Transaction Unit that has become a
Defaulted Unit, all monies collected by the Servicer (from whatever source,
including, but not limited to, proceeds of a deficiency balance or insurance
proceeds recovered after the charge-off of the related Transaction Unit) on such
Defaulted Unit, net of any expenses incurred by the Servicer in connection
therewith, Supplemental Servicing Fees and any payments required by law to be
remitted to the Lessee.
"Redemption Date" means in the case of a redemption of the Notes pursuant
to Section 10.1 of the Indenture, the Payment Date specified by the
Administrator or the Issuer pursuant to Section 10.1 of the Indenture.
"Redemption Price" means an amount equal to the unpaid principal amount of
the Notes redeemed plus accrued and unpaid interest thereon at the applicable
Interest Rate for the Notes being so redeemed, up to but excluding the
Redemption Date.
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"Registered Holder" means the Person in whose name a Note is registered on
the Note Register on the related Record Date.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. Sections 229.110-229.1123, as such regulation may be
amended from time to time and subject to such clarification and interpretation
as have been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531
(January 7, 2005)) or by the staff of the Commission, or as may be provided in
writing by the Commission or its staff from time to time.
"Regular Principal Distribution Amount" means, with respect to any Payment
Date, an amount not less than zero, equal to the difference between (a) the
excess, if any, of (i) the Outstanding Amount of the Notes as of the preceding
Payment Date (after giving effect to any principal payments made on the Notes on
such preceding Payment Date) over (ii) the Targeted Note Balance minus (b) the
First Priority Principal Distribution Amount, if any, with respect to such
Payment Date.
"Related Rights" means, with respect to any Vehicle and related Lease, all
Origination Trust Assets to the extent such assets are associated with such
Unit.
"Reporting Date" means the second Business Day preceding the related
Payment Date.
"Reserve Account" means the account designated as such, established and
maintained pursuant to Section 8.2(a) of the Indenture.
"Residual Losses" means, for any Collection Period, an amount (which, for
the avoidance of doubt, shall be a positive number in the case of residual
losses and a negative number in the case of residual gains) equal to (a) the sum
of all residual losses (i.e., the amount by which the Securitization Value of a
Transaction Unit exceeds the Sales Proceeds for such Unit) for all Included
Units that became Terminated Units during such Collection Period following the
scheduled termination of the related Leases minus (b) the sum of all Excess
Mileage Charges and Excess Wear and Tear Charges received by the Servicer with
respect to Included Units during such Collection Period.
"Responsible Officer" means, with respect to the Indenture Trustee, any
officer within the corporate trust department of the Indenture Trustee,
including any vice president, assistant vice president, assistant secretary,
assistant treasurer, trust officer or any other officer of the Indenture Trustee
who customarily performs functions similar to those performed by the persons who
at the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such person's knowledge of and familiarity with
the particular subject and who shall have direct responsibility for the
administration of the Indenture and, with respect to the Owner Trustee, any
officer within the Corporate Trust Office of the Owner Trustee and having direct
responsibility for the administration of the Issuer, including any Vice
President, Assistant Vice President, Assistant Treasurer, Assistant Secretary,
or any other officer customarily performing functions similar to those performed
by any of the above designated officers and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such
officer's knowledge of and familiarity with the particular subject.
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"Sales Proceeds" means, with respect to any Transaction Vehicle, an amount
equal to the aggregate amount of proceeds received by the Servicer from the
purchaser in connection with the sale or other disposition of such Transaction
Vehicle, net of any and all out-of-pocket costs and expenses incurred by the
Servicer in connection with such sale or other disposition, including without
limitation, all repossession, auction, painting, repair and any and all other
similar liquidation and refurbishment costs and expenses.
"Sarbanes-Oxley Act" means the Sarbanes-Oxley Act of 2002, as amended.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Securitization Rate" means, with respect to any Included Unit, [_____]%.
"Securitization Value" means, for each Included Unit, (a) as of the Cut-Off
Date or any date other than the maturity date of the related Lease, the sum of
(i) the present value (discounted at the Securitization Rate) of the aggregate
monthly payments remaining on the Lease (including monthly payments due and not
yet paid for which the Servicer has never made an Advance) and (ii) the present
value (discounted at the Securitization Rate) of the Base Residual Value of the
related Vehicle and (b) as of the maturity date of the related Lease, the Base
Residual Value of the related Vehicle; provided, however, that the
Securitization Value of a Terminated Unit is equal to zero.
"Servicer" means VCI, initially, and any replacement Servicer appointed
pursuant to the Transaction SUBI Servicing Supplement.
"Servicer Certificate" has the meaning set forth in Section 8.3(a) of the
Indenture.
"Servicer Replacement Event" means any one or more of the following that
shall have occurred and be continuing:
(a) any failure by the Servicer to deliver or cause to be delivered
any required payment to the Indenture Trustee for distribution to the
Noteholders, which failure continues unremedied for ten business days after
discovery thereof by an officer of the Servicer or receipt by the Servicer of
written notice thereof from the Indenture Trustee or Noteholders evidencing at
least a majority of the Outstanding Note Amount, voting together as a single
class;
(b) any failure by the Servicer to duly observe or perform in any
material respect any other of its covenants or agreements in the Transaction
SUBI Servicing Supplement or the Servicing Agreement, which failure materially
and adversely affects the rights of any holder of the Transaction SUBI
Certificate or the Noteholders, and which continues unremedied for 90 days after
discovery thereof by an officer of the Servicer or receipt by the Servicer of
written notice thereof from the Indenture Trustee or Noteholders evidencing at
least a majority of the Outstanding Note Amount, voting together as a single
class;
(c) any representation or warranty of the Servicer made in the
Transaction SUBI Servicing Supplement or the Servicing Agreement, any other
Transaction Document to which the Servicer is a party or by which it is bound or
any certificate delivered pursuant to the Transaction SUBI Servicing Supplement
or the Servicing Agreement shall prove to be incorrect
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in any material respect when made, which failure materially and adversely
affects the rights of any holder of the Transaction SUBI Certificate or the
Noteholders, and such failure continues unremedied for 90 days after discovery
thereof by an officer of the Servicer or receipt by the Servicer of written
notice thereof from the Indenture Trustee or Noteholders evidencing at least a
majority of the Outstanding Note Amount, voting together as a single class; it
being understood that any repurchase of a Unit by VCI pursuant to Section 2.3 of
the SUBI Sale Agreement shall be deemed to remedy any incorrect representation
or warranty with respect to such Unit; or
(d) the Servicer suffers a Bankruptcy Event;
provided, however, that a delay in or failure of performance referred to under
clauses (a), (b) or (c) above for a period of 150 days will not constitute a
Servicer Replacement Event if such delay or failure was caused by force majeure
or other similar occurrence.
"Servicing Agreement" means the Amended and Restated Servicing Agreement,
dated as of December 21, 2000, between the Origination Trust and VCI, as
amended, modified and supplemented by the Transaction SUBI Servicing Supplement,
and as the same may be further amended or modified from time to time.
"Servicing Criteria" shall mean the "servicing criteria" set forth in Item
1122(d) of Regulation AB.
"Servicing Fee" means, for any Collection Period, an amount equal to the
product of (a) one-twelfth (or, in the case of the initial Collection Period
(i.e., the period commencing on the close of business on the Cut-Off Date and
ending on [__________], [____]), one-sixth), (b) 1.00% and (c) the aggregate
Securitization Value at the beginning of such Collection Period (or, in the case
of the first Payment Date, at the Cut-Off Date) of all Included Units for such
Collection Period.
"Settlor" means VCI, as settlor under the Origination Trust Agreement.
"Special Purpose Entity" means any special purpose corporation,
partnership, limited partnership, trust, business trust, limited liability
company or other entity created for one or more Financings.
"Standard & Poor's" means Standard & Poor's Ratings Services, a division of
the McGraw-Hill Companies, Inc., or any successor that is a nationally
recognized statistical rating organization.
"Stated Residual Value" means, for any Unit, the stated residual value of
the related Vehicle established at the time of origination of the related Lease
or as subsequently revised in connection with an extension of a Lease in
accordance with Customary Servicing Practices.
"Statutory Trust Act" means Chapter 38 of Title 12 of the Delaware Code, 12
Del. Code Section 3801 et seq., as the same may be amended from time to time.
"SUBI" means a special unit of beneficial interest in the Origination
Trust.
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"SUBI Assets" means a separate portfolio of Origination Trust Assets
allocated to a SUBI.
"SUBI Certificate" means any trust certificate representing any SUBI.
"SUBI Portfolio" means any portfolio of Origination Trust Assets allocated
to the Transaction SUBI or any Other SUBI.
"SUBI Sale Agreement" means the SUBI Sale Agreement, dated as of the
Closing Date, between VCI and the Transferor, as the same may be amended or
modified from time to time.
"SUBI Transfer Agreement" means the SUBI Transfer Agreement, dated as of
the Closing Date, between the Transferor and the Issuer, as amended or
supplemented from time to time.
"SUBI Trustee" means [U.S. Bank], as SUBI Trustee under the Transaction
SUBI Supplement.
"Subordinated Note" has the meaning set forth in Section 2.4 of the SUBI
Sale Agreement.
"Supplemental Servicing Fees" means any and all (i) late fees, (ii)
extension fees, (iii) prepayment charges, (iv) early termination fees or any
other fees paid to the Servicer in connection with the termination of any Lease
(other than monthly lease payments and Excess Wear and Tear Charges and Excess
Mileage Charges), (v) non-sufficient funds charges and (vi) any and all other
administrative fees or similar charges allowed by applicable law received by or
on behalf of the Servicer, the Transferor, the Issuer or the Origination Trust
with respect to any Unit.
"Targeted Note Balance" means, the excess, if any, of (x) the aggregate
Securitization Value at the end of the Collection Period preceding such Payment
Date over (y) the Targeted Overcollateralization Amount with respect to such
Payment Date.
"Targeted Overcollateralization Amount" means $[__________].
"Targeted Reserve Account Balance" means $[__________].
"Taxes" means all taxes, charges, fees, levies or other assessments
(including income, gross receipts, profits, withholding, excise, property,
sales, use, license, occupation and franchise taxes and including any related
interest, penalties or other additions) imposed by any jurisdiction or taxing
authority (whether foreign or domestic).
"Terminated Unit" shall mean an Included Unit for which any of the
following has occurred during a Collection Period:
(a) the related Leased Vehicle was sold or otherwise disposed of by the
Servicer following (i) such Unit becoming a Defaulted Unit or (ii) the scheduled
or early termination (including any early termination by the related Lessee) of
the related Lease;
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(b) such Unit became a Defaulted Unit or the related Lease terminated or
expired more than 90 days prior to the end of such Collection Period and the
related Leased Vehicle was not sold; or
(c) the Servicer's records, in accordance with Customary Servicing
Practices, disclose that all insurance proceeds expected to be received have
been received by the Servicer following a Casualty or other loss with respect to
the related Leased Vehicle.
"TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended and as in force on the date hereof, unless otherwise specifically
provided.
"Transaction Documents" means the Indenture, the Notes, the Depository
Agreement, the Transaction SUBI Servicing Supplement, the Transaction SUBI
Supplement, the Servicing Agreement (to the extent that it deals solely with the
Transaction SUBI and the Transaction SUBI Portfolio), the Origination Trust
Agreement (to the extent that it deals solely with the Transaction SUBI and the
Transaction SUBI Portfolio), the SUBI Sale Agreement, the SUBI Transfer
Agreement, the Administration Agreement, the Trust Agreement and all other
documents, instruments and agreements executed or furnished on the Closing Date
in connection herewith and therewith, as the same may be amended or modified
from time to time.
"Transaction Lease" means, for any Transaction Vehicle, the Lease for such
Transaction Vehicle.
"Transaction SUBI" means that special unit of beneficial interest of the
Origination Trust created by the Transaction SUBI Supplement to which
Transaction Units are allocated.
"Transaction SUBI Certificate" means the certificate of beneficial
ownership, representing beneficial ownership of the Origination Trust Assets
comprising the Transaction SUBI Portfolio, issued pursuant to the Transaction
SUBI Supplement.
"Transaction SUBI Portfolio" means the Origination Trust Assets that are
from time to time identified and allocated to the Transaction SUBI in accordance
with the terms of the Origination Trust Documents.
"Transaction SUBI Servicing Supplement" means the Transaction SUBI
Supplement 20[__]-[__] to Servicing Agreement, dated as of the Closing Date,
among the Origination Trust, the SUBI Trustee and the Servicer, as the same may
be amended or modified from time to time.
"Transaction SUBI Supplement" means the Transaction SUBI Supplement
20[__]-[__] to Origination Trust Agreement, dated as of the Closing Date,
between VCI, as Settlor and Initial Beneficiary, and U.S. Bank, as
Administrative Trustee, UTI Trustee and SUBI Trustee, as the same may be amended
or modified from time to time.
"Transaction Unit" means a Unit that has been allocated to the Transaction
SUBI Portfolio, the entire beneficial ownership interest in which is represented
by the Transaction SUBI Certificate.
23
"Transaction Vehicle" means, at any time, a Vehicle then identified and
allocated to the Transaction SUBI.
"Transferor" means Volkswagen Auto Lease Underwritten Funding, LLC, a
Delaware limited liability company.
"Treasury Regulations" means regulations, including proposed or temporary
regulations, promulgated under the Code from time to time.
"Trust Agreement" means the Amended and Restated Trust Agreement, dated as
of the Closing Date, between the Transferor and the Owner Trustee, as the same
may be amended and supplemented from time to time.
"Trust Estate" means all money, accounts, chattel paper, general
intangibles, goods, instruments, investment property and other property of the
Issuer, including (i) the Transaction SUBI Certificate (transferred pursuant to
the SUBI Transfer Agreement), evidencing a 100% beneficial interest in the
Transaction SUBI, including the right to payments thereunder after the Cut-Off
Date, (ii) the rights of the Issuer to the funds on deposit from time to time in
the Reserve Account, the Collection Account and any other account or accounts
established pursuant to the Indenture and all cash, investment property and
other property from time to time credited thereto and all proceeds thereof
(including investment earnings, net of losses and investment expenses, on
amounts on deposit therein), (iii) the rights of the Transferor, as buyer, under
the SUBI Sale Agreement, (iv) the rights of the Issuer, as buyer, under the SUBI
Transfer Agreement, (v) the rights of the Issuer as a third-party beneficiary
under the Origination Trust Documents, to the extent relating to the Included
Units, and (vi) all proceeds of the foregoing (it being understood that, with
respect to Sales Proceeds, the actual Sales Proceeds shall be held by the
Qualified Intermediary or in a Qualified Intermediary Account and shall not
constitute part of the Trust Estate).
"UCC" means, unless the context otherwise requires, the Uniform Commercial
Code as in effect in the relevant jurisdiction, as amended from time to time.
"Unit" means a Vehicle, the related Lease and the Related Rights associated
therewith.
"United States" or "USA" means the United States of America (including all
states, the District of Columbia and political subdivisions thereof).
["U.S. Bank" means U.S. Bank National Association, a national banking
association, with a corporate trust office in Chicago, Illinois.]
"UTI" has the meaning specified in Section 4.1(a) of the Origination Trust
Agreement.
"UTI Asset" has the meaning specified in Section 4.1(a) of the Origination
Trust Agreement.
"UTI Certificate" has the meaning specified in Section 4.1(a) of the
Origination Trust Agreement.
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"UTI Portfolio" means the portfolio consisting of all Origination Trust
Assets not allocated to a SUBI Portfolio.
"UTI Trustee" means [U.S. Bank], as UTI Trustee under the Origination Trust
Agreement.
"VCI" means VW Credit, Inc., a Delaware corporation, and its successors and
assigns.
"Vehicle" means an automobile, sport utility vehicle, van, luxury vehicle,
mid-range vehicle, economy vehicle or light general purpose truck, together with
any and all non-severable appliances, parts, instruments, accessories,
furnishings, other equipment, accessions, additions, improvements, substitutions
and replacements from time to time in or to such vehicle.
"Volkswagen AG" means Volkswagen Aktiengesellschaft or its successor in
interest.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms. Unless otherwise inconsistent with the
terms of this Indenture, all accounting terms used herein shall be interpreted,
and all accounting determinations hereunder shall be made, in accordance with
GAAP. Amounts to be calculated hereunder shall be continuously recalculated at
the time any information relevant to such calculation changes.
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