EXHIBIT 10.6
$200,000,000
Variable Funding Note, Class A
$25,000,000
Variable Funding Note, Class B
---------------------------------
SECOND AMENDED AND RESTATED INDENTURE
Dated as of February 14, 2007
-----------------------------------
PAGE FUNDING LLC,
Issuer
and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
Trustee
TABLE OF CONTENTS
PAGE NO.
ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE..............................................................4
SECTION 1.1 Definitions...............................................................................4
SECTION 1.2 [Reserved]................................................................................4
SECTION 1.3 Other Definitional Provisions.............................................................4
ARTICLE II THE NOTES..............................................................................................5
SECTION 2.1 Form......................................................................................5
SECTION 2.2 Execution, Authentication and Delivery....................................................5
SECTION 2.3 [Reserved]................................................................................6
SECTION 2.4 Registration; Registration of Transfer and Exchange.......................................6
SECTION 2.5 Restrictions on Transfer and Exchange.....................................................7
SECTION 2.6 Mutilated, Destroyed, Lost or Stolen Note.................................................9
SECTION 2.7 Persons Deemed Owner.....................................................................10
SECTION 2.8 Payment of Principal and Interest; Defaulted Interest....................................10
SECTION 2.9 Cancellation.............................................................................11
SECTION 2.10 Release of Trust Estate..................................................................11
SECTION 2.11 Amount Limited; Advances.................................................................11
ARTICLE III COVENANTS............................................................................................12
SECTION 3.1 Payment of Principal and Interest........................................................12
SECTION 3.2 Maintenance of Office or Agency..........................................................13
SECTION 3.3 Money for Payments to be Held in Trust...................................................13
SECTION 3.4 Existence................................................................................14
SECTION 3.5 Protection of Trust Estate...............................................................14
SECTION 3.6 Opinions as to Trust Estate..............................................................15
SECTION 3.7 Performance of Obligations; Servicing of Receivables.....................................16
SECTION 3.8 Negative Covenants.......................................................................17
SECTION 3.9 Annual Statement as to Compliance........................................................18
SECTION 3.10 Issuer May Consolidate, Etc. Only with Consent...........................................18
SECTION 3.11 Successor or Transferee..................................................................18
SECTION 3.12 No Other Business........................................................................18
SECTION 3.13 No Borrowing.............................................................................19
SECTION 3.14 Servicer's Obligations...................................................................19
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities........................................19
SECTION 3.16 Capital Expenditures.....................................................................19
SECTION 3.17 Compliance with Laws.....................................................................19
SECTION 3.18 Restricted Payments......................................................................19
SECTION 3.19 Notice of Events of Default and Funding Termination Events...............................19
SECTION 3.20 Further Instruments and Acts.............................................................20
SECTION 3.21 Amendments of Sale and Servicing Agreement...............................................20
SECTION 3.22 Income Tax Characterization..............................................................20
SECTION 3.23 Separate Existence of the Issuer.........................................................20
SECTION 3.24 Amendment of Issuer's Organizational Documents...........................................20
SECTION 3.25 Other Agreements.........................................................................20
SECTION 3.26 Rule 144A Information....................................................................20
SECTION 3.27 Change of Control........................................................................21
ARTICLE IV SATISFACTION AND DISCHARGE............................................................................21
SECTION 4.1 Satisfaction and Discharge of Indenture..................................................21
SECTION 4.2 Application of Trust Money...............................................................22
SECTION 4.3 Repayment of Moneys Held by Note Paying Agent............................................22
-i-
TABLE OF CONTENTS
PAGE NO.
ARTICLE V REMEDIES...............................................................................................22
SECTION 5.1 Events of Default........................................................................22
SECTION 5.2 Rights Upon Event of Default.............................................................24
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee..........................25
SECTION 5.4 Remedies.................................................................................26
SECTION 5.5 Optional Preservation of the Receivables.................................................27
SECTION 5.6 Priorities...............................................................................28
SECTION 5.7 Limitation of Suits......................................................................29
SECTION 5.8 Unconditional Rights of the Noteholders To Receive Principal and Interest................31
SECTION 5.9 Restoration of Rights and Remedies.......................................................31
SECTION 5.10 Rights and Remedies Cumulative...........................................................31
SECTION 5.11 Delay or Omission Not a Waiver...........................................................31
SECTION 5.12 [Reserved]...............................................................................31
SECTION 5.13 Waiver of Past Defaults..................................................................31
SECTION 5.14 Undertaking for Costs....................................................................32
SECTION 5.15 Waiver of Stay or Extension Laws.........................................................32
SECTION 5.16 Sale of Trust Estate.....................................................................32
ARTICLE VI THE TRUSTEE...........................................................................................35
SECTION 6.1 Duties of Trustee........................................................................35
SECTION 6.2 Rights of Trustee........................................................................36
SECTION 6.3 Individual Rights of Trustee.............................................................37
SECTION 6.4 Trustee's Disclaimer.....................................................................37
SECTION 6.5 Notice of Defaults.......................................................................37
SECTION 6.6 Reports by Trustee to the Noteholders....................................................37
SECTION 6.7 Compensation and Indemnity...............................................................37
SECTION 6.8 Replacement of Trustee...................................................................38
SECTION 6.9 Successor Trustee by Merger..............................................................38
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee............................................39
SECTION 6.11 Eligibility: Disqualification............................................................40
SECTION 6.12 [RESERVED]...............................................................................40
SECTION 6.13 Appointment and Powers...................................................................40
SECTION 6.14 Performance of Duties....................................................................40
SECTION 6.15 Limitation on Liability..................................................................41
SECTION 6.16 [Reserved]...............................................................................41
SECTION 6.17 Successor Trustee........................................................................41
SECTION 6.18 [Reserved]...............................................................................42
SECTION 6.19 Representations and Warranties of the Trustee............................................42
SECTION 6.20 Waiver of Setoffs........................................................................43
SECTION 6.21 Control by the Controlling Note Purchaser and the Majority Noteholders of the Highest
Priority Class 43
ARTICLE VII [RESERVED]...........................................................................................43
ARTICLE VIII COLLECTION OF MONEY AND RELEASES OF TRUST ESTATE....................................................43
SECTION 8.1 Collection of Money......................................................................43
SECTION 8.2 Release of Trust Estate..................................................................43
ARTICLE IX SUPPLEMENTAL INDENTURES...............................................................................44
SECTION 9.1 Supplemental Indentures with Consent of the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class................................................44
SECTION 9.2 Supplemental Indentures with Consent of Note Purchasers and Noteholders..................45
SECTION 9.3 Execution of Supplemental Indentures.....................................................47
SECTION 9.4 Effect of Supplemental Indenture.........................................................47
-ii-
ARTICLE X REPAYMENT AND PREPAYMENT OF NOTES......................................................................48
SECTION 10.1 Repayment of the Notes; Optional Prepayment of the Notes.................................48
SECTION 10.2 Notice of Prepayment.....................................................................48
SECTION 10.3 General Procedures.......................................................................49
ARTICLE XI MISCELLANEOUS.........................................................................................49
SECTION 11.1 Compliance Certificates and Opinions, etc................................................49
SECTION 11.2 Form of Documents Delivered to Trustee...................................................50
SECTION 11.3 Acts of Noteholders or Note Purchasers...................................................51
SECTION 11.4 Notices, etc., to Trustee, Issuer, the Note Purchasers and Noteholders...................51
SECTION 11.5 Waiver...................................................................................52
SECTION 11.6 Alternate Payment and Notice Provisions..................................................53
SECTION 11.7 Effect of Headings and Table of Contents.................................................53
SECTION 11.8 Successors and Assigns...................................................................53
SECTION 11.9 Benefits of Indenture....................................................................53
SECTION 11.10 Severability.............................................................................53
SECTION 11.11 Legal Holidays...........................................................................53
SECTION 11.12 Governing Law............................................................................54
SECTION 11.13 Counterparts.............................................................................54
SECTION 11.14 Recording of Indenture...................................................................54
SECTION 11.15 Issuer Obligation........................................................................54
SECTION 11.16 No Petition..............................................................................54
SECTION 11.17 Inspection...............................................................................54
SECTION 11.18 Market Value.............................................................................55
SECTION 11.19 Intercreditor Agreement to Control.......................................................55
SECTION 11.20 Controlling Note Purchaser; Majority Noteholders of Highest Priority Class...............55
SECTION 11.21 Separate Grants................................................Error! Bookmark not defined.
SECTION 11.22 Entire Agreement.........................................................................56
Exhibits
- --------
Exhibit A-1 Form of Class A Note
Exhibit A-2 Form of Class B Note
Exhibit B Form of Transferor Representation Letter
Exhibit C Form of Transferee Representation Letter (Qualified Institutional Buyers)
Exhibit D Form of Transferee Representation Letter (Institutional Accredited Investors)
Exhibit E Form of Collateral Release Letter
-iii-
SECOND AMENDED AND RESTATED INDENTURE dated as of February 14, 2007
("Indenture"), by and between PAGE FUNDING LLC, a Delaware limited liability
company (the "Issuer"), and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national
banking association, as trustee (the "Trustee").
Each party agrees as follows for the benefit of the other parties and
for the benefit of the Note Purchasers and each Holder of the Issuer's Variable
Funding Notes, Class A (the "Class A Notes") and each Holder of the Issuer's
Variable Funding Notes, Class B (the "Class B Notes" and, together with the
Class A Notes, the "Notes"):
To secure the payment of principal of and interest on, and any other
amounts owing in respect of the Notes, the other Secured Obligations and any and
all other amounts due and payable to the Note Purchasers and the Noteholders
under the Basic Documents, and to secure compliance with this Indenture, the
Issuer has agreed to pledge the Collateral (as defined below) as collateral to
the Trustee for the benefit of the Noteholders and the Note Purchasers.
In addition, to secure the payment of principal of and interest on, and
any other amounts owing in respect of the Class B Notes, the Bear Secured
Obligations and any and all other amounts due and payable to the Class B Note
Purchasers and the Class B Noteholders under the Basic Documents, and to secure
compliance with this Indenture, the Issuer has agreed to pledge the Pledged
Subordinate Securities as collateral to the Trustee for the benefit of the Class
B Noteholders and the Class B Note Purchasers.
Furthermore, to secure the payment of principal of and interest on, and
any other amounts owing in respect of the Class B notes issued pursuant to the
Bear Indenture and any and all other amounts due and payable to the Class B note
purchasers and the Class B noteholders under the Bear Basic Documents, and to
secure compliance with the Bear Indenture, the Issuer has agreed to pledge the
UBS Cross Collateral, on a subordinated basis and subject to the Intercreditor
Agreement, as collateral to the Bear Indenture Trustee for the benefit of the
Class B noteholders and the Class B note purchasers under the Bear Basic
Documents.
As security for the payment and performance by the Issuer of the
Secured Obligations, the Issuer has agreed to assign the Collateral (as defined
below) as collateral to the Trustee for the benefit of the Noteholders and the
Note Purchasers.
In addition, as security for the payment and performance by the Issuer
of the Secured Obligations owing to the Class B Noteholders and the Class B Note
Purchasers and the Bear Secured Obligations, the Issuer has agreed to assign the
Pledged Subordinate Securities as collateral to the Trustee for the benefit of
the Class B Noteholders and the Class B Note Purchasers.
Furthermore, as security for the payment and performance by the Issuer
of the Bear Secured Obligations owing to the Class B noteholders and the Class B
note purchasers under the Bear Basic Documents, and as consideration for the
assignment by Page Three Funding LLC, on a subordinated basis and subject to the
Bear Intercreditor Agreement, of the Bear Cross Collateral as collateral to the
Trustee for the benefit of the Class B Noteholders and the Class B Note
Purchasers, the Issuer has agreed to assign, on a subordinated basis and subject
to the Intercreditor Agreement, the UBS Cross Collateral as collateral to the
Bear Indenture Trustee for the benefit of the Class B noteholders and the Class
B note purchasers under the Bear Basic Documents.
GRANTING CLAUSES
I. The Issuer hereby Grants to the Trustee on each Funding Date, as
Trustee for the benefit of the Noteholders and the Note Purchasers, all right,
title and interest of the Issuer, whether now existing or hereafter arising, in
and to the following;
(a) the Receivables listed in the Schedule of Receivables and each
Addition Notice;
(b) all monies received under the Receivables after the related Cutoff
Date and all Net Liquidation Proceeds received with respect to the Receivables
on and after the related Cutoff Date;
-1-
(c) the security interests in the Financed Vehicles and any accessions
thereto granted by Obligors pursuant to the related Contracts and any other
interest of the Issuer in such Financed Vehicles, including, without limitation,
the certificates of title or, with respect to such Financed Vehicles in the
States listed in Annex B to the Sale and Servicing Agreement, other evidence of
title issued by the applicable Department of Motor Vehicles or similar authority
in such States, with respect to such Financed Vehicles;
(d) any proceeds from claims on any Receivables Insurance Policies or
certificates relating to the Financed Vehicles securing the Receivables or the
Obligors thereunder;
(e) all proceeds from recourse against Dealers or Consumer Lenders with
respect to the Receivables and all other rights arising out of or with respect
to the Receivables (but none of the obligations) of the Seller under any
agreements with Dealers or Consumer Lenders;
(f) refunds for the costs of extended service contracts with respect to
Financed Vehicles securing Receivables, refunds of unearned premiums with
respect to credit life and credit accident and health insurance policies or
certificates covering an Obligor or Financed Vehicle under a Receivable or his
or her obligations with respect to a Financed Vehicle and any recourse to
Dealers or Consumer Lenders for any of the foregoing;
(g) the Receivable File related to each Receivable and all other
documents that the Issuer keeps on file in accordance with its customary
procedures relating to the Receivables, for Obligors of the Financed Vehicles;
(h) all amounts and property from time to time held in or credited to
the Collection Account, the Note Distribution Account, the Principal Funding
Account and the Lockbox Accounts;
(i) all property (including the right to receive future Net Liquidation
Proceeds) that secures a Receivable that has been acquired by or on behalf of
the Seller, the Purchaser or the Issuer pursuant to a liquidation of such
Receivable;
(j) all of the rights and benefits (but none of the obligations of the
Issuer) under the Sale and Servicing Agreement and all other Basic Documents,
including a direct right to cause the Seller to purchase Receivables from the
Issuer pursuant to the Sale and Servicing Agreement under the circumstances
specified therein;
(k) each Note Purchase Agreement (to the extent of the Issuer's rights
against, but not including any of its obligations to, the Seller);
(l) the proceeds from any Servicer's errors and omissions policy or
fidelity bond, to the extent that such proceeds relate to any Receivable,
Financed Vehicle or other Collateral;
(m) each TFC Assignment; and
(n) 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 and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing (collectively, the property described in this Granting
Clause I, the "COLLATERAL").
The foregoing Grant is made in trust to the Trustee, for the benefit of
the Noteholders and the Note Purchasers, to secure the payment of principal of
and interest on, and any other amounts owing in respect of the Notes, to secure
the payment of all Secured Obligations and any and all other amounts due and
payable to the Note Purchasers and the Noteholders under the Basic Documents, in
each case whether now owed or hereafter arising, and to secure compliance with
this Indenture. The Trustee hereby acknowledges such Grant, accepts the trusts
under this Indenture in accordance with the provisions of this Indenture and
agrees to perform its duties as required in this Indenture.
-2-
The Grant of Liens pursuant to the foregoing Granting Clause I shall be
deemed to constitute two separate and distinct grants of Liens and because of,
among other things, their differing rights in the Collateral, obligations to the
Class A Note Purchasers and the Class A Noteholders, on the one hand, are
fundamentally different from the obligations to the Class B Note Purchasers and
the Class B Noteholders, on the other hand, and must be separately classified in
any plan of reorganization proposed or adopted in an insolvency proceeding. To
further effectuate the intent of the parties as provided in the immediately
preceding sentence, if it is held that the claims of the Class A Note Purchaser
and the Class A Noteholders, on the one hand, and the claims of the Class B Note
Purchasers and the Class B Noteholders, on the other hand, in each case in
respect of the Collateral constitute only one secured claim (rather than
separate classes of senior and junior secured claims), then the Class B Note
Purchasers and the Class B Noteholders hereby acknowledge and agree that all
distributions shall be made as if there were separate classes of senior and
junior secured claims in respect of the Collateral (with the effect being that,
to the extent that the aggregate value of the Collateral is sufficient (for this
purpose ignoring all claims held by the Class B Note Purchasers and the Class B
Noteholders), the Class A Note Purchaser and the Class A Noteholders shall be
entitled to receive, in addition to amounts distributed to them in respect of
principal, pre-petition interest and other claims, all amounts owing in respect
of post-petition interest, with the Class B Note Purchasers and the Class B
Noteholders hereby acknowledging and agreeing to turn over to the Trustee for
application in accordance with the terms of the Basic Documents amounts
otherwise received or receivable by them with respect to the Collateral (but not
with respect to the Pledged Subordinate Securities or the Class B Available
Funds) to the extent necessary to effectuate the intent of this sentence, even
if such turnover has the effect of reducing the claim or recovery of the Class B
Note Purchasers and the Class B Noteholders.
II. The Issuer hereby Grants to the Trustee, as Trustee for the benefit
of the Class B Noteholders and each Class B Note Purchaser, all right, title and
interest of the Issuer, whether now existing or hereafter arising, in and to the
following;
(a) any Pledged Subordinate Securities delivered to the Trustee
pursuant to Section 3.3(c) of the Sale and Servicing Agreement; and
(b) 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 and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing.
The foregoing Grant is made in trust to the Trustee, for the benefit of
the Class B Noteholders and each Class B Note Purchaser, to secure the payment
of principal of and interest on, and any other amounts owing in respect of the
Class B Notes, to secure the payment of all Secured Obligations, all Bear
Secured Obligations and any and all other amounts due and payable, in each case,
to the Class B Note Purchasers and the Class B Noteholders pursuant to the Basic
Documents and to secure compliance with this Indenture. The Trustee hereby
acknowledges such Grant, accepts the trusts under this Indenture in accordance
with the provisions of this Indenture and agrees to perform its duties as
required in this Indenture.
III. The Issuer hereby Grants to the Bear Indenture Trustee, as trustee
for the benefit of the Class B note purchasers and the Class B noteholders under
the Bear Basic Documents, all right, title and interest of the Issuer (subject
to Granting Clause I and the Intercreditor Agreement), whether now existing or
hereafter arising, in and to the following;
(a) the Collateral; and
-3-
(b) 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 and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing (collectively, the property described in this Granting
Clause III, the "UBS CROSS COLLATERAL").
The foregoing Grant is made in trust to the Bear Indenture Trustee, as
trustee for the benefit of the Class B note purchasers and the Class B
noteholders under the Bear Basic Documents, to secure the payment of principal
of and interest on, and any other amounts owing in respect of all Bear Secured
Obligations and any and all other amounts due and payable, in each case, to the
Class B note purchasers and the Class B noteholders pursuant to the Bear Basic
Documents and to secure compliance with the Bear Indenture. Notwithstanding
anything to the contrary set forth herein or in any of the Basic Documents or
the Bear Basic Documents, the foregoing Grant is expressly (i) subordinate to,
and subject to the prior Lien of the Trustee, the Class A Noteholders and the
Class A Note Purchasers granted pursuant to Granting Clause I and (ii) subject
to the terms and provisions of the Intercreditor Agreement, and, in the event of
a conflict between the terms and provisions of this Indenture, on the one hand,
and the Intercreditor Agreement, on the other hand, the terms and provisions of
the Intercreditor Agreement shall control.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 DEFINITIONS. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to them in Annex A to
the Third Amended and Restated Sale and Servicing Agreement dated as of February
14, 2007 among the Issuer, the Seller, the Servicer, the Purchaser, the Backup
Servicer and the Trustee, as the same may be further amended, supplemented or
otherwise modified from time to time in accordance with its terms (the "Sale and
Servicing Agreement").
SECTION 1.2 [RESERVED].
SECTION 1.3 OTHER DEFINITIONAL PROVISIONS. (i) All terms defined in
this Indenture shall have the defined meanings when used in any instrument
governed hereby and in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(ii) Accounting terms used but not defined or partly defined in this
Indenture, in any instrument governed hereby or in any certificate or other
document made or delivered pursuant hereto, to the extent not defined, shall
have the respective meanings given to them under GAAP or any such instrument,
certificate or other document, as applicable. To the extent that the definitions
of accounting terms in this Indenture or in any such instrument, certificate or
other document are inconsistent with the meanings of such terms under GAAP, the
definitions contained in this Indenture or in any such instrument, certificate
or other document shall control.
(iii) The words "HEREOF," "HEREIN," "HEREUNDER" and words of similar
import when used in this Indenture shall refer to this Indenture as a whole and
not to any particular provision of this Indenture.
-4-
(iv) Section, Schedule and Exhibit references contained in this
Indenture are references to Sections, Schedules and Exhibits in or to this
Indenture unless otherwise specified; and the term "INCLUDING" shall mean
"INCLUDING WITHOUT LIMITATION."
(v) The definitions contained in this Indenture are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(vi) Any agreement, instrument or statute defined or referred to herein
or in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as the same may from time to time be amended,
modified or supplemented and includes (in the case of agreements or instruments)
references to all attachments and instruments associated therewith; all
references to a Person include its permitted successors and assigns.
(vii) The singular form of the terms "NOTE" and "NOTEHOLDER" shall not
preclude issuance of more than one Note or ownership of Notes by more than one
Noteholder. The singular forms of such terms shall also mean the plural forms of
such terms and the plural form of such terms shall also mean the singular form
thereof, in each case as the context requires.
ARTICLE II
THE NOTES
SECTION 2.1 FORM. The Notes, together with the Trustee's certificate of
authentication, shall be in substantially the form set forth in Exhibit A-1 (in
the case of the Class A Notes) and EXHIBIT A-2 (in the case of the Class B
Notes), 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 the Notes, as evidenced by their execution of the Notes. Any
portion of the text of the Notes may be set forth on the reverse thereof, with
an appropriate reference thereto on the face of the Notes. The Class A Notes
were originally issued on the Class A Closing Date and the Class B Notes will be
issued on the Class B Closing Date. Each class of Notes shall be subject to
Advances and prepayments from time to time in accordance with SECTION 2.11 and
ARTICLE X, respectively.
(a) The Notes shall be typewritten, printed, lithographed or engraved
or produced by any combination of these methods (with or without steel engraved
borders), all as determined by the officers executing the Notes, as evidenced by
their execution of the Notes.
(b) The terms of the Notes set forth in Exhibits A-1 and A-2 are part
of the terms of this Indenture.
SECTION 2.2 EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
(a) A Note bearing the manual or facsimile signature of individuals who
were at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Note or did not hold
such offices at the date of such Note.
(b) The Trustee shall upon receipt of an Issuer Order for
authentication and delivery, authenticate and deliver each class of Notes for
original issue in an aggregate principal amount up to, but not in excess of, the
Class A Maximum Invested Amount, in the case of the Class A Notes, and the Class
B Maximum Invested Amount, in the case of the Class B Notes.
-5-
(c) Each Note shall be dated the date of its authentication. The Notes
shall be issuable as registered Notes in the minimum denomination of $1,000,000
and in integral multiples of $1,000 in excess thereof (except for one Note of a
class which may be issued in a lesser denomination and other than an integral
multiple of $1,000).
(d) No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears attached to such Note
a certificate of authentication substantially in the form provided for herein,
executed by the Trustee by the manual signature of one of its authorized
signatories, and such certificate attached to such Note shall be conclusive
evidence, and the only evidence, that such Note has been duly authenticated and
delivered hereunder.
SECTION 2.3 [RESERVED]
SECTION 2.4 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE. The
Issuer shall cause the Trustee to keep a register (the "Note Register") in
which, subject to such reasonable regulations as it may prescribe and subject to
the provisions of Section 2.5, the Trustee shall provide for the registration of
the Notes, and the registration of transfers and exchanges of the Notes. The
Trustee shall be "Note Registrar" for the purpose of registering the Notes and
transfers of the Notes as herein provided. Upon any resignation or removal of
any Note Registrar, the Issuer shall promptly appoint a successor.
(a) If a Person other than the Trustee is appointed by the Issuer as
Note Registrar, such Person must be acceptable to the Controlling Note Purchaser
and, in addition, the Issuer will give the Trustee, the Note Purchasers and the
Noteholders prompt written notice of the appointment of such Note Registrar
(once approved by the Controlling Note Purchaser) and of the location, and any
change in the location, of the Note Register, and the Trustee shall have the
right to inspect the Note Register at all reasonable times and to obtain copies
thereof. The Trustee shall have the right to conclusively rely upon a
certificate executed on behalf of the Note Registrar by an Executive Officer
thereof as to the name and address of each Holder of a Note and the Percentage
Interest and number of each Note.
(b) Subject to SECTION 2.5 hereof, upon surrender for registration of
transfer of a 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(a) of the UCC are
met, the Trustee shall have the Issuer execute and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Notes in the minimum Percentage Interest of 1%
representing in the aggregate the Percentage Interest on the face of the Note to
be transferred.
(c) At the option of a Holder, a Note may be exchanged for another Note
in any authorized Percentage Interest, of the same class and a like aggregate
Percentage Interest, upon surrender of the Note to be exchanged at such office
or agency. Whenever a Note is so surrendered for exchange, subject to Section
2.5 hereof, if the requirements of SECTION 8-401(a) of the UCC are met, the
Issuer shall execute, and upon request by the Issuer the Trustee shall
authenticate, and the Noteholder shall obtain from the Trustee, the Note which
the Noteholder making the exchange is entitled to receive.
(d) The Note or Notes issued upon any registration of transfer or
exchange of a Note shall be the valid obligation of the Issuer, evidencing, in
the aggregate, the same debt, and entitled to the same benefits under this
Indenture, as the Note surrendered upon such registration of transfer or
exchange.
(e) Every Note presented or surrendered for registration of transfer or
exchange shall be (i) duly endorsed by, or accompanied by a written assignment
in substantially the form attached to EXHIBIT A duly executed by, the Holder
thereof or such Holder's attorney, duly authorized in writing, with such
signature guaranteed by an "ELIGIBLE GUARANTOR INSTITUTION" meeting the
requirements of the Note Registrar which requirements include membership or
participation in Securities Transfer Agents Medallion Program ("STAMP") or such
other "SIGNATURE GUARANTEE PROGRAM" as may be determined by the Note Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and (ii) accompanied by such other
documents as the Trustee may require.
-6-
(f) No service charge shall be made to a Holder for any registration of
transfer or exchange of a Note, but the Note Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any registration of transfer or exchange of a Note, other
than exchanges pursuant to SECTION 9.6 not involving any transfer.
(g) The preceding provisions of this SECTION 2.4 notwithstanding, the
Issuer shall not be required to make and the Note Registrar shall not register
transfers or exchanges of a Note selected for redemption or of any Note for a
period of two (2) Business Days preceding the due date for any payment with
respect to such Note.
SECTION 2.5 RESTRICTIONS ON TRANSFER AND EXCHANGE.
(a) No transfer of a Note shall be made unless the transferor thereof
has provided a representation letter substantially in the form of EXHIBIT B that
such transfer is (i) to the Issuer or an Affiliate of the Issuer, or (ii) in
compliance with Section 2.5(b) hereof, to a qualified purchaser (as defined
under Section 2(a)(51) of the Investment Company Act) that is a qualified
institutional buyer (as defined in Rule 144A under the Securities Act) in a
transaction meeting the requirements of Rule 144A under the Securities Act, or
(iii) in compliance with Section 2.5(c) hereof, to a qualified purchaser (as
defined in Section 2(a)(51) of the Investment Company Act) that is an
institutional "ACCREDITED INVESTOR" as defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D promulgated under the Securities Act, or (iv) to a qualified
purchaser (as defined under Section 2(a)(51) of the Investment Company Act) in a
transaction complying with or exempt from the registration requirements of the
Securities Act and in accordance with any applicable securities laws of any
state of the United States or any other jurisdiction; PROVIDED, that (except
with respect to the transfer of the Note or Advance made by the Noteholder), in
the case of CLAUSES (iv) the Trustee or the Issuer may require an Opinion of
Counsel to the effect that such transfer may be effected without registration
under the Securities Act, which Opinion of Counsel, if so required, shall be
addressed to the Issuer and the Trustee and shall be secured at the expense of
the Holder. Each prospective purchaser by its acquisition of a Note,
acknowledges that such Note will contain a legend substantially to the effect
set forth in SECTION 2.5(e) (unless the Issuer determines otherwise in
accordance with applicable law).
Any transfer or exchange of a Note to a proposed transferee shall be
conducted in accordance with the provisions of Section 2.4, and shall be
contingent upon receipt by the Note Registrar of (A) such Note properly endorsed
for assignment or transfer, (B) written instruction from such transferring
Holder directing the Note Registrar to cause the transfer to such transferees,
in such Percentage Interests (not to exceed the Percentage Interest on the face
of the Note to be transferred) as the transferring Holder shall specify in such
instructions; and (C) such certificates or signatures as may be required under
such Note or this Section 2.5, in each case, in form and substance satisfactory
to the Note Registrar. The Note Registrar shall cause any such transfers and
related cancellations or increases and related reductions, as applicable, to be
properly recorded in its books in accordance with the requirements of Section
2.4.
(b) If a Note is sold to a "qualified purchaser" (as defined in Section
2(a)(51) of the Investment Company Act) that is a "qualified institutional
buyer" (as defined in Rule 144A of the Securities Act) purchasing for its own
account or for the account of another "qualified purchaser" that is a "qualified
institutional buyer," such Note shall be issued as a certificated Note in
definitive, fully registered form without interest coupons with the applicable
legends set forth in the form of the Note registered in the name of the
beneficial owner or a nominee thereof, duly executed by the Issuer and
authenticated by the Trustee as hereinafter provided. Any transfer to a
"qualified purchaser" that is a "qualified institutional buyer" is expressly
conditioned upon the requirement that such transferee shall deliver a
representation letter in the form of EXHIBIT C.
(c) If the Note is sold in the United States to U.S. Persons under
Section 4(2) of the Securities Act to a "qualified purchaser" (as defined in
Section 2(a)(51) of the Investment Company Act) that is an institutional
"accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) under the
-7-
Securities Act), it shall be issued in the form of certificated Note in
definitive, fully registered form without interest coupons with the applicable
legends set forth in the form of the Note registered in the name of the
beneficial owner or a nominee thereof, duly executed by the Issuer and
authenticated by the Trustee as hereinafter provided. Any transfer to a
"qualified purchaser" (as defined in Section 2(a)(51) of the Investment Company
Act) that is an institutional "ACCREDITED INVESTOR" is expressly conditioned
upon the requirement that such transferee shall deliver a representation letter
in the form of EXHIBIT D.
(d) The Note Registrar shall not register any transfer or exchange of
any Class A Note to the extent that upon such transfer or exchange there would
be more than four (4) Class A Noteholders then reflected on the Note Register.
The Note Registrar shall not register any transfer or exchange of any Class B
Note to the extent that upon such transfer or exchange there would be more than
ninety (90) Class B Noteholders then reflected on the Note Register.
(e) Unless the Issuer determines otherwise in accordance with
applicable law, each Note shall have the following legend:
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR "BLUE
SKY" LAWS AND MAY BE RESOLD, PLEDGED OR TRANSFERRED ONLY TO (1) THE ISSUER (UPON
REDEMPTION THEREOF OR OTHERWISE) OR AN AFFILIATE OF THE ISSUER (AS CERTIFIED BY
THE ISSUER) OR (2) A "QUALIFIED PURCHASER" (AS DEFINED IN SECTION 2(a)(51) OF
THE INVESTMENT COMPANY ACT) THAT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D PROMULGATED UNDER THE
SECURITIES ACT THAT EXECUTES A CERTIFICATE, SUBSTANTIALLY IN THE FORM SPECIFIED
IN THE INDENTURE, TO THE EFFECT THAT IT IS AN INSTITUTIONAL ACCREDITED INVESTOR
ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY
OR AGENT FOR OTHERS (WHICH OTHERS ARE ALSO QUALIFIED PURCHASERS THAT ARE
INSTITUTIONAL ACCREDITED INVESTORS) (3) SO LONG AS THIS NOTE IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A TO A PERSON THAT EXECUTES A CERTIFICATE,
SUBSTANTIALLY IN THE FORM SPECIFIED IN THE INDENTURE, TO THE EFFECT THAT SUCH
PERSON IS A "QUALIFIED PURCHASER" (AS DEFINED UNDER SECTION 2(a)(51) OF THE
INVESTMENT COMPANY ACT) THAT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A), ACTING FOR ITS OWN ACCOUNT, OR AS A FIDUCIARY OR AGENT FOR OTHERS
(WHICH OTHERS ARE ALSO QUALIFIED PURCHASERS THAT ARE QUALIFIED INSTITUTIONAL
BUYERS) TO WHOM NOTICE IS GIVEN THAT THE SALE, PLEDGE, OR TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, OR (4) TO A QUALIFIED PURCHASER (AS DEFINED UNDER
SECTION 2(a)(51) OF THE INVESTMENT COMPANY ACT) IN A TRANSACTION OTHERWISE
EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION, IN
EACH SUCH CASE, IN COMPLIANCE WITH THE INDENTURE AND ALL APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION: PROVIDED,
THAT, IN THE CASE OF CLAUSE (4), THE TRUSTEE OR THE ISSUER MAY REQUIRE AN
OPINION OF COUNSEL TO THE EFFECT THAT SUCH TRANSFER MAY BE EFFECTED WITHOUT
REGISTRATION UNDER THE SECURITIES ACT, WHICH OPINION OF COUNSEL, IF SO REQUIRED,
SHALL BE ADDRESSED TO THE ISSUER AND THE TRUSTEE AND SHALL BE SECURED AT THE
EXPENSE OF THE HOLDER. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF THE
EXEMPTION PROVIDED BY RULE 144A FOR RESALES OF THIS NOTE.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AND SUBJECT TO INCREASES
AND DECREASES AS SET FORTH HEREIN AND IN THE INDENTURE. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
[THE NOTE REGISTRAR SHALL NOT REGISTER ANY TRANSFER OR EXCHANGE OF THIS NOTE TO
THE EXTENT THAT UPON SUCH TRANSFER OR EXCHANGE THERE WOULD BE MORE THAN FOUR (4)
CLASS A NOTEHOLDERS THEN REFLECTED ON THE NOTE REGISTER.]
-8-
[THE NOTE REGISTRAR SHALL NOT REGISTER ANY TRANSFER OR EXCHANGE OF THIS NOTE TO
THE EXTENT THAT UPON SUCH TRANSFER OR EXCHANGE THERE WOULD BE MORE THAN NINETY
(90) CLASS B NOTEHOLDERS THEN REFLECTED ON THE NOTE REGISTER.]
[THIS NOTE IS SUBJECT TO THE TERMS AND PROVISIONS OF AN INTERCREDITOR AGREEMENT
DATED AS OF FEBRUARY 14, 2007 BY AND AMONG THE CLASS A NOTE PURCHASER, THE CLASS
A NOTEHOLDER, THE CLASS B NOTE PURCHASERS, THE CLASS B NOTEHOLDERS, THE ISSUER,
THE PURCHASER, THE SELLER, THE SERVICER AND THE TRUSTEE, AS THE SAME MAY BE
AMENDED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME.]
[THIS NOTE IS SUBORDINATE IN RIGHT OF PAYMENT TO THE ISSUER'S CLASS A NOTES
ISSUED PURSUANT TO THE INDENTURE REFERENCED HEREIN AND TO ALL OTHER AMOUNTS DUE
AND OWING TO THE CLASS A NOTEHOLDERS AND THE CLASS A NOTE PURCHASER IN
ACCORDANCE WITH THE TERMS OF THE BASIC DOCUMENTS AND IS SUBJECT TO THE TERMS AND
PROVISIONS OF AN INTERCREDITOR AGREEMENT DATED AS OF FEBRUARY 14, 2007 BY AND
AMONG THE CLASS A NOTE PURCHASER, THE CLASS A NOTEHOLDER, THE CLASS B NOTE
PURCHASERS, THE CLASS B NOTEHOLDERS, THE ISSUER, THE PURCHASER, THE SELLER, THE
SERVICER AND THE TRUSTEE, AS THE SAME MAY BE AMENDED, SUPPLEMENTED OR OTHERWISE
MODIFIED FROM TIME TO TIME.]
(f) Notwithstanding any of the foregoing provisions of this Section
2.5, no transfer or assignment of a Secured Obligation shall be made that would
cause there to be more than 90 owners and assignees of the Class B Notes at any
time. For purposes of determining the number of owners and assignees of the
Class B Notes, a Person (beneficial owner) owning an interest in a partnership
(including any entity treated as a partnership for federal income tax purposes),
grantor trust or S corporation (flow through entity), that owns, directly or
through other flow-through entities, an interest in the Class B Notes, is
treated as an owner or an assignee of the Class B Notes if (i) substantially all
of the value of the beneficial owner's interest in the flow through entity is
attributable to the flow-through entity's interest (direct or indirect) in the
Class B Notes, and (ii) the principal purpose of the use of the tiered
arrangement is to permit the satisfaction of the 90 owner and assignee of Class
B Notes limitation.
SECTION 2.6 MUTILATED, DESTROYED, LOST OR STOLEN NOTE. If (i) any
mutilated Note is surrendered to the Trustee, or the Trustee receives evidence
to its satisfaction of the destruction, loss or theft of any Note, and (ii)
there is delivered to the Trustee such security or indemnity as may be required
by it to hold the Issuer and the Trustee harmless, then, in the absence of
notice to the Issuer, the Note Registrar or the Trustee that such Note has been
acquired by a protected purchaser, and, provided that the requirements of
Section 8-405 and 8-406 of the UCC are met, the Issuer shall execute, and upon
request by the Issuer, the Trustee shall authenticate and deliver in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Note, a
replacement Note; PROVIDED, HOWEVER, that if any such destroyed, lost or stolen
Note, but not a mutilated Note, shall have become, or within seven days shall
be, due and payable or shall have been called for redemption, instead of issuing
a replacement Note, the Issuer may direct the Trustee, in writing, to pay such
destroyed, lost or stolen Note when so due or payable without surrender thereof.
If, after the delivery of such replacement Note or payment of a destroyed, lost
or stolen Note pursuant to the preceding sentence, a protected purchaser of the
original Note in lieu of which such replacement Note was issued, presents for
payment such original Note, the Issuer and the Trustee shall be entitled to
recover such replacement Note (or such payment) from the Person to whom it was
delivered or any assignee of such Person, except a protected purchaser, and
shall be entitled to recover upon the security or indemnity provided therefor to
the extent of any loss, damage, cost or expense incurred by the Issuer or the
Trustee in connection therewith.
(a) Upon the issuance of any replacement Note under this Section, the
Issuer may require the payment by the Holder of such Note of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Trustee) connected therewith.
-9-
(b) 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 the Notes duly issued hereunder.
(c) 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 any mutilated, destroyed, lost or stolen Note.
SECTION 2.7 PERSONS DEEMED OWNER. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Trustee and any agent of
the Issuer or the Trustee may treat the Person in whose name such Note is
registered (as of the applicable Record Date) as the owner of such Note for the
purpose of receiving payments of principal of and interest, if any, on such
Note, for all other purposes whatsoever and whether or not such Note be overdue,
and none of the Issuer, the Trustee or any agent of the Issuer or the Trustee
shall be affected by notice to the contrary.
SECTION 2.8 PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED INTEREST.
(a) The Class A Notes shall accrue interest as provided in the form of
Class A Note set forth in EXHIBIT A-1, and such interest shall be due and
payable on each Settlement Date, as specified therein. The Class B Notes shall
accrue interest as provided in the form of Class B Note set forth in Exhibit
A-2, and such interest shall be due and payable on each Settlement Date, as
specified therein. Any installment of interest or principal, if any, payable on
any Note which is punctually paid or duly provided for by the Issuer on the
applicable Settlement Date shall be paid to the Person in whose name such Note
is registered on the Record Date, either (i) by wire transfer in immediately
available funds to such Person's account as it appears on the Note Register on
such Record Date if (A) such Noteholder has provided to the Note Registrar
appropriate written instructions at least five Business Days prior to such
Settlement Date and such Holder's Note in the aggregate evidence a Percentage
Interest of not less than 1% or (B) such Noteholder is the Seller, or an
Affiliate thereof, or if not, (ii) by check mailed to such Noteholder at the
address of such Noteholder appearing on the Note Register, except for the final
installment of principal payable with respect to such Note on a Settlement Date
or on the applicable Facility Termination Date, which shall be payable as
provided below.
(b) If the Class A Facility Termination Date is determined in
accordance with subsection (I) of the definition thereof, the outstanding
principal balance of the Class A Notes and all accrued and unpaid interest
thereon will be amortized and shall be payable in full by the Class A Final
Scheduled Settlement Date. If the Class A Facility Termination Date is
determined in accordance with subsection (II) of the definition thereof, such
Class A Facility Termination Date will result in immediate acceleration of the
Class A Notes in accordance with Section 5.2. If the Class A Facility
Termination Date is determined in accordance with subsection (III) of the
definition thereof, the outstanding principal balance of the Class A Notes and
all accrued and unpaid interest thereon will be amortized and shall be payable
in full by the third Settlement Date following the relevant anniversary of the
Class A Closing Date. The outstanding principal amount of the Class B Notes and
all accrued and unpaid interest thereon shall be payable in full by the Class B
Facility Termination Date and otherwise as provided in Section 3.1, the form of
Class B Note attached hereto as Exhibit A-2, and the other Basic Documents. The
principal amount outstanding under any Note at any time shall be equal to the
product of the Percentage Interest represented by such Note and the then
outstanding applicable Invested Amount. All principal payments on the Notes of a
class shall be made pro rata to the Noteholders of such class entitled thereto
based on their respective Percentage Interests. Upon written notice from the
Issuer, the Trustee shall notify the Person in whose name a Note is registered
at the close of business on the Record Date preceding the Settlement Date on
which the Issuer expects that the final installment of principal of and interest
on such Note will be paid. Such notice shall be mailed or transmitted by
facsimile prior to such final Settlement Date and shall specify that such final
installment will be payable only upon presentation and surrender of such Note
and shall specify the place where such Note may be presented and surrendered for
payment of such installment.
-10-
(c) If the Issuer defaults in any payment of interest on a Note, the
Issuer shall pay defaulted interest (plus interest on such defaulted interest to
the extent lawful) at the applicable Note Interest Rate then in effect
(calculated for this purpose using the applicable Default Applicable Margin) in
any lawful manner. The Issuer shall pay such defaulted interest to the
Noteholders entitled thereto on the immediately following Settlement Date. At
least three (3) days before any such Settlement Date, the Issuer shall mail to
the Noteholders and the Trustee a notice that states the Settlement Date and the
amount of defaulted interest to be paid.
SECTION 2.9 CANCELLATION. Any Note surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and shall be promptly
canceled by the Trustee. The Issuer may at any time deliver to the Trustee for
cancellation any Note previously authenticated and delivered hereunder which the
Issuer may have acquired in any manner whatsoever, and the Note so delivered
shall be promptly canceled by the Trustee. No Note shall be authenticated in
lieu of or in exchange for any Note canceled as provided in this Section, except
as expressly permitted by this Indenture. A canceled Note may be held or
disposed of by the Trustee in accordance with its standard retention or disposal
policy as in effect at the time unless the Issuer shall direct by an Issuer
Order that they be destroyed or returned to it; PROVIDED that such Issuer Order
is timely and such Note has not been previously disposed of by the Trustee.
SECTION 2.10 RELEASE OF TRUST ESTATE. Subject to the terms of the other
Basic Documents and SECTIONS 10.1 and 11.1, the Trustee shall, on or after the
Termination Date, release any remaining portion of the Trust Estate from the
lien created by this Indenture and deposit in the Collection Account any funds
then on deposit in any other Pledged Account. In addition, the Trustee shall
release Ineligible Receivables from the lien created by this Indenture upon any
dividend of such Ineligible Receivables that is permitted under Section 5.10 of
the Sale and Servicing Agreement. The Trustee shall release property from the
lien created by this Indenture pursuant to this SECTION 2.10 only upon receipt
of an Issuer Request accompanied by an Officer's Certificate meeting the
applicable requirements of SECTION 11.1.
SECTION 2.11 AMOUNT LIMITED; ADVANCES.
(a) The maximum aggregate principal amount of the Class A Notes that
may be authenticated and delivered and Outstanding at any time under this
Indenture (except for Class A Notes authenticated and delivered pursuant to
SECTION 2.6 in replacement for destroyed, lost or stolen Class A Notes) is
limited to the Class A Maximum Invested Amount.
On each Business Day prior to the Class A Facility Termination Date
that is a Class A Funding Date, and upon the satisfaction of all conditions
precedent to (a) the funding of a Class A Advance and (b) the purchase of
Receivables, in each case as set forth in Section 2.1(b) of the Sale and
Servicing Agreement, and Section 6.02 and Section 6.03 of the Class A Note
Purchase Agreement, the Issuer shall be entitled to borrow additional funds
pursuant to a Class A Advance made by the Class A Note Purchaser on such Class A
Funding Date, in accordance with Section 2.02 and Section 2.03 of the Class A
Note Purchase Agreement, in an aggregate principal amount equal to the Class A
Advance Amount with respect to such Class A Funding Date. Each request by the
Issuer for a Class A Advance shall include a certification by the Issuer as to
the satisfaction of the conditions specified in the previous sentence.
The aggregate outstanding principal amount of the Class A Notes may be
increased (subject to the Class A Maximum Invested Amount) through the funding
of Class A Advances. Each Class A Advance and corresponding Class A Advance
Amount shall be recorded by the Class A Note Purchaser, and the Class A Note
Purchaser's record (which may be in electronic or other form in the Class A Note
Purchaser's reasonable discretion) shall show all Class A Advance Amounts and
prepayments. Absent manifest error, such record of the Class A Note Purchaser
shall be dispositive with respect to the determination of the outstanding
principal amount of the Class A Notes. The Class A Notes (i) can be funded by
Class A Advances on any Class A Funding Date in a minimum amount of $2,000,000
-11-
and any higher amount (subject to the Class A Maximum Invested Amount), and (ii)
subject to subsequent Class A Advances pursuant to this SECTION 2.11(a), are
subject to prepayment in whole or in part, at the option of the Issuer as
provided in ARTICLE X herein. In addition, and independent of optional
prepayments pursuant to ARTICLE X, in the event that a Class A Borrowing Base
Deficiency exists on any date of determination as determined by the Class A Note
Purchaser in its sole discretion, the Issuer shall on the same Business Day of
the receipt of notice from the Class A Note Purchaser (or if notice is received
after 10:01 a.m. New York time, then on the next Business Day), prepay the Class
A Invested Amount by an amount equal to such Class A Borrowing Base Deficiency
by paying such amount to or at the direction of the Class A Note Purchaser.
(b) The maximum aggregate principal amount of the Class B Notes that
may be authenticated and delivered and Outstanding at any time under this
Indenture (except for Class B Notes authenticated and delivered pursuant to
Section 2.6 in replacement for destroyed, lost or stolen Class B Notes) is
limited to the Class B Maximum Invested Amount.
On each Business Day prior to the Class B Facility Termination Date
that is a Class B Funding Date, and upon the satisfaction of all conditions
precedent to (a) the funding of a Class B Advance and (b) the purchase of
Receivables, in each case as set forth in Section 2.1(b) of the Sale and
Servicing Agreement, and Section 6.02 and Section 6.03 of the Class B Note
Purchase Agreement, the Issuer shall be entitled to borrow additional funds
pursuant to a Class B Advance made by each Class B Note Purchaser on such Class
B Funding Date, in accordance with Section 2.02 and Section 2.03 of the Class B
Note Purchase Agreement, in an aggregate principal amount equal to the Class B
Advance Amount (subject to the Class B Maximum Invested Amount) with respect to
such Class B Funding Date. Each request by the Issuer for a Class B Advance
shall include a certification by the Issuer as to the satisfaction of the
conditions specified in the previous sentence.
The aggregate outstanding principal amount of the Class B Notes may be
increased (subject to the Class B Maximum Invested Amount) through the funding
of Class B Advances. Each Class B Note Purchaser shall record its respective pro
rata portion of each Class B Advance and corresponding Class B Advance Amount,
and each Class B Note Purchaser's record (which may be in electronic or other
form in each Class B Note Purchaser's reasonable discretion) shall show all
Class B Advance Amounts and prepayments made or received by such Class B Note
Purchaser. Absent manifest error, such record of each Class B Note Purchaser
shall be dispositive with respect to the determination of such Class B Note
Purchaser's respective pro rata portion of the outstanding principal amount of
the Class B Notes. The Class B Notes (i) can be funded by Class B Advances on
any Class B Funding Date in a minimum amount of $250,000 and any higher amount
(subject to the Class B Maximum Invested Amount), and (ii) subject to subsequent
Class B Advances pursuant to this Section 2.11(a), are subject to prepayment in
whole or in part, at the option of the Issuer as provided in Article X herein.
In addition, and independent of optional prepayments pursuant to Article X, in
the event that a Class B Borrowing Base Deficiency exists on any date of
determination as determined by a Class B Note Purchaser in its sole discretion,
the Issuer shall on the same Business Day of the receipt of notice from such
Class B Note Purchaser (or if notice is received after 10:01 a.m. New York time,
then on the next Business Day), prepay the Class B Invested Amount by an amount
equal to such Class B Borrowing Base Deficiency by paying the respective pro
rata portion of such amount to or at the direction of each Class B Note
Purchaser. Notwithstanding the foregoing and subject to Section 3.05(c) of the
Class B Note Purchase Agreement, the Issuer may not prepay any such Class B
Invested Amount to cure a Class B Borrowing Base Deficiency or otherwise
pursuant to Article X with funds other than Class B Available Funds unless and
until any and all amounts then due and owing to the Class A Note Purchaser and
the Class A Noteholders under the Basic Documents have been paid in full.
ARTICLE III
COVENANTS
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The Issuer will duly and
punctually pay or cause to be paid the principal of and interest on the Notes in
accordance with the terms of the Notes, this Indenture, the Sale and Servicing
Agreement and the other Basic Documents. Without limiting the foregoing, the
Issuer will cause to be distributed on each Settlement Date all amounts
deposited in the Note Distribution Account pursuant to the Sale and Servicing
-12-
Agreement to the Noteholders and the Note Purchasers in the order of priority
specified in Section 5.8 of the Sale and Servicing Agreement. Amounts properly
withheld under the Code by the Trustee from a payment to the Noteholders of
interest and/or principal shall be considered as having been paid by the Issuer
to the Noteholders for all purposes of this Indenture.
SECTION 3.2 MAINTENANCE OF OFFICE OR AGENCY. The Issuer will maintain
in Minneapolis, Minnesota, an office or agency where the Notes may be
surrendered for registration of transfer or exchange, and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Issuer hereby initially appoints the Trustee to serve as its agent
for the foregoing purposes. The Issuer will give prompt written notice to the
Trustee, the Note Purchasers and the Noteholders of the location, and of any
change in the location, of any such office or agency. If at any time the Issuer
shall fail to maintain any such office or agency or shall fail to furnish the
Trustee with the address thereof, such surrenders, notices and demands may be
made or served at the Corporate Trust Office, and the Issuer hereby appoints the
Trustee as its agent to receive all such surrenders, notices and demands.
SECTION 3.3 MONEY FOR PAYMENTS TO BE HELD IN TRUST. On or before each
Settlement Date, the Trustee shall deposit or cause to be deposited in the Note
Distribution Account from the Collection Account an aggregate sum sufficient to
pay the amounts then becoming due under each class of Notes and all other
amounts then due and owing to the Noteholders and the Note Purchasers under the
Basic Documents, such sums to be held in trust for the benefit of the Persons
entitled thereto. Except as provided in SECTION 3.3(c) hereof, all payments of
amounts due and payable with respect to the Notes and such other amounts that
are to be made from amounts withdrawn from the Note Distribution Account shall
be made on behalf of the Issuer by the Trustee or by the Note Paying Agent, and
no amounts so withdrawn from the Note Distribution Account for payment of the
Notes or to the Noteholders or the Note Purchasers shall be paid to the Issuer.
(a) The Issuer shall cause each Note Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in which such Note
Paying Agent shall agree with the Trustee (and if the Trustee acts as Note
Paying Agent, it hereby so agrees), subject to the provisions of this Section,
that such Note Paying Agent shall:
(i) hold all sums held by it for the payment of amounts due
with respect to the Notes and such other amounts in trust for the
benefit of the Persons entitled thereto until such sums shall be paid
to such Persons or otherwise disposed of as herein provided and pay
such sums to such Persons as herein provided;
(ii) give the Trustee notice of any default by the Issuer (or
any other obligor upon the Notes) of which it has actual knowledge in
the making of any payment required to be made with respect to the Notes
or to the Noteholders or the Note Purchasers;
(iii) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Note Paying Agent;
(iv) immediately resign as a Note Paying Agent and forthwith
pay to the Trustee all sums held by it in trust for the payment of the
Notes and such other amounts if at any time it ceases to meet the
standards required to be met by a Note Paying Agent at the time of its
appointment; and
(v) comply with all requirements of the Code with respect to
the withholding from any payments made by it on the Notes of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith.
(b) 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 Note Paying Agent to pay to the Trustee all sums held in trust
by such Note Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which the sums were held by such Note Paying Agent; and
-13-
upon such a payment by any Note Paying Agent to the Trustee, such Note Paying
Agent shall be released from all further liability with respect to such money.
(c) Subject to applicable laws with respect to the escheat of funds,
any money held by the Trustee or any Note Paying Agent in trust for the payment
of any amount due with respect to the Notes and remaining unclaimed for two
years after such amount has become due and payable shall be discharged from such
trust and be paid to the Issuer on Issuer Request and shall be deposited by the
Trustee in the Collection Account; and the Noteholders and the Note Purchasers
shall thereafter, as unsecured general creditors, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Trustee or such Note Paying Agent with respect to such
trust money shall thereupon cease; provided, however, that the Trustee or such
Note Paying Agent, before being required to make any such repayment, shall at
the expense of the Issuer cause to be published once, in a newspaper published
in the English language, customarily published on each Business Day and of
general circulation in the City of New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such publication, any unclaimed balance of such money
then remaining will be repaid to the Issuer. The Trustee shall also adopt and
employ, at the expense of the Issuer, any other reasonable means of notification
of such repayment (including, but not limited to, mailing notice of such
repayment to the Holder whose Notes have been called but have not been
surrendered for redemption or whose right to or interest in moneys due and
payable but not claimed is determinable from the records of the Trustee or of
any Note Paying Agent, at the last address of record for each such Holder).
SECTION 3.4 EXISTENCE. Except as otherwise permitted by the provisions
of SECTION 3.10, the Issuer will keep in full effect its existence, rights and
franchises as a limited liability company under the laws of the State of
Delaware (unless it becomes, or any successor Issuer hereunder is or becomes,
organized under the laws of any other state or of the United States of America,
in which case the Issuer will keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and will obtain and
preserve its qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral, the Pledged
Subordinate Securities, the UBS Cross Collateral, the other Basic Documents and
each other instrument or agreement included in the Trust Estate.
SECTION 3.5 PROTECTION OF TRUST ESTATE. The Issuer intends the security
interest Granted pursuant to Granting Clause I of this Indenture in favor of the
Trustee, for the benefit of the Noteholders and the Note Purchasers, to be prior
to all other liens in respect of the Collateral, and the Issuer shall take all
actions necessary to obtain and maintain, in favor of the Trustee, for the
benefit of the Noteholders and the Note Purchasers, a first lien on and a first
priority, perfected security interest in the Collateral, subject to the
Intercreditor Agreement. In addition, the Issuer intends the security interest
Granted pursuant to Granting Clause II of this Indenture in favor of the
Trustee, for the benefit of the Class B Noteholders and the Class B Note
Purchasers, to be prior to all other liens in respect of the Pledged Subordinate
Securities, and the Issuer shall take all actions necessary to obtain and
maintain, in favor of the Trustee, for the benefit of the Class B Noteholders
and the Class B Note Purchasers, a first lien on and a first priority, perfected
security interest in the Pledged Subordinate Securities. Furthermore, the Issuer
intends the security interest Granted pursuant to Granting Clause III of this
Indenture in favor of the Bear Indenture Trustee, for the benefit of the Class B
noteholders and the Class B note purchasers under the Bear Basic Documents, to
be prior to all other liens in respect of the UBS Cross Collateral (other than
the Lien granted in Granting Clause I of this Indenture and subject to the
Intercreditor Agreement), and the Issuer shall take all actions necessary to
obtain and maintain, in favor of the Bear Indenture Trustee, for the benefit of
the Class B noteholders and the Class B note purchasers under the Bear Basic
Documents, a second lien on and a second priority, perfected security interest
in the UBS Cross Collateral (subject only to the Lien Granted in Granting Clause
I of this Indenture and subject to the Intercreditor Agreement). The Issuer will
from time to time prepare (or shall cause to be prepared), execute and deliver
all such supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:
(i) Grant more effectively all or any portion of the Trust
Estate;
-14-
(ii) maintain or preserve each lien and security interest (and
the priority thereof) in favor of the Trustee for the benefit of the
applicable Noteholders and the applicable Note Purchasers created by
this Indenture or carry out more effectively the purposes hereof;
(iii) maintain or preserve each lien and security interest
(and the priority thereof) in favor of the Bear Indenture Trustee for
the benefit of the Class B noteholders and the Class B note purchasers
under the Bear Basic Documents created by this Indenture or carry out
more effectively the purposes hereof;
(iv) perfect, publish notice of or protect the validity of any
Grant made or to be made by this Indenture;
(v) enforce (A) subject to the Intercreditor Agreement, any of
the Collateral on behalf of the Noteholders or the Note Purchasers, or
(B) any of the Pledged Subordinate Securities on behalf of the Class B
Noteholders or the Class B Note Purchasers, or (C) subject to the
Intercreditor Agreement, the UBS Cross Collateral on behalf of the
Class B noteholders or the Class B note purchasers under the Bear Basic
Documents;
(vi) preserve and defend title to (A) subject to the
Intercreditor Agreement, the Collateral and the rights of the Trustee,
the Noteholders and the Note Purchasers in such Collateral against the
claims of all persons and parties; (B) the Pledged Subordinate
Securities and the rights of the Trustee, the Class B Noteholders and
the Class B Note Purchasers in such Pledged Subordinate Securities
against the claims of all persons and parties; and (C) subject to the
Intercreditor Agreement, the UBS Cross Collateral and the rights of the
Bear Indenture Trustee, the Class B noteholders and the Class B note
purchasers under the Bear Basic Documents in such UBS Cross Collateral
against the claims of all persons and parties (other than the Lien
Granted pursuant to Clause I of this Indenture); and
(vii) pay all taxes or assessments levied or assessed upon the
Trust Estate when due; provided that no Available Funds may be used to
pay taxes or assessments levied or assessed upon that portion of the
Trust Estate consisting of the Pledged Subordinate Securities and no
Class B Available Funds may be used to pay taxes or assessments levied
or assessed upon that portion of the Trust Estate consisting of the
Collateral.
The Issuer hereby designates the Trustee its agent and attorney-in-fact
to execute any financing statement, continuation statement or other instrument
required by the Trustee pursuant to this Section.
Subject to Section 4.5 of the Sale and Servicing Agreement, the Issuer
hereby authorizes the Controlling Note Purchaser, the Trustee and their
respective agents to file such financing statements and continuation statements
and take such other actions as the Controlling Note Purchaser or the Trustee may
deem advisable in connection with the security interest in the Collateral
Granted by the Issuer under Granting Clause I of this Indenture to the extent
permitted by applicable law. In addition, the Issuer hereby authorizes the Class
B Note Purchasers, the Trustee and their respective agents to file such
financing statements and continuation statements and take such other actions as
the Class B Note Purchasers or the Trustee may deem advisable in connection with
the security interest in the Pledged Subordinate Securities Granted by the
Issuer under Granting Clause II of this Indenture to the extent permitted by
applicable law. Furthermore, subject to the terms and provisions of the
Intercreditor Agreement, the Issuer hereby authorizes the Bear Indenture Trustee
and the Class B note purchasers under the Bear Basic Documents and their
respective agents to file such financing statements and continuation statements
and take such other actions as the Bear Indenture Trustee or such Class B note
purchasers may deem advisable in connection with the security interest in the
UBS Cross Collateral Granted by the Issuer under Granting Clause III of this
Indenture to the extent permitted by applicable law and subject to the prior
Lien of Granting Clause I of this Indenture. Any such financing statements and
continuation statements shall be prepared by the Issuer.
SECTION 3.6 OPINIONS AS TO TRUST ESTATE.
-15-
(a) On the Class B Closing Date, the Issuer shall furnish to the
Trustee and each Note Purchaser an Opinion of Counsel either stating that, in
the opinion of such counsel, such action has been taken with respect to the
recording and filing of this Indenture, any indentures supplemental hereto, and
any other requisite documents, and with respect to the execution and filing of
any financing statements and continuation statements, as are necessary to
perfect and make effective (i) the first priority lien and security interest in
favor of the Trustee, for the benefit of the Noteholders and the Note
Purchasers, created by Granting Clause I of this Indenture in the Receivables
and such other items of Collateral, (ii) the first priority lien and first
priority perfected security interest in favor of the Trustee, for the benefit of
the Class B Noteholders and the Class B Note Purchasers, created by Granting
Clause II of this Indenture in the Pledged Subordinate Securities, and (iii) the
second priority lien and second priority security interest in favor of the Bear
Indenture Trustee, for the benefit of the Class B noteholders and the Class B
note purchasers under the Bear Basic Documents, created by Granting Clause III
of this Indenture (subject only to the Lien Granted in Granting Clause I of this
Indenture) in the UBS Cross Collateral (collectively, the "Opinion Collateral")
and reciting the details of such action, or stating that, in the opinion of such
counsel, no such action is necessary to make such lien and security interest
effective.
(b) Within 90 days after the beginning of each calendar year, beginning
in 2007, the Issuer shall furnish to the Trustee, each Note Purchaser, the Bear
Indenture Trustee and each Class B note purchaser under the Bear Basic Documents
an Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording, filing, re-recording and
refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as are necessary to maintain
the liens and security interests created by this Indenture in the Opinion
Collateral and reciting the details of such action or stating that in the
opinion of such counsel no such action is necessary to maintain such liens and
security interests. Such Opinion of Counsel shall also describe any action
necessary (as of the date of such opinion) to be taken in the following year to
maintain the liens and security interests of this Indenture in the Opinion
Collateral.
SECTION 3.7 PERFORMANCE OF OBLIGATIONS; SERVICING OF RECEIVABLES. The
Issuer will not take any action and will use its best efforts not to permit any
action to be taken by others that would release any Person from any of such
Person's material covenants or obligations under any instrument or agreement
included in the Trust Estate or that would result in the amendment,
hypothecation, subordination, termination or discharge of or impair the validity
or effectiveness of, any such instrument or agreement, except as ordered by any
bankruptcy or other court or as expressly provided in this Indenture, the other
Basic Documents or such other instrument or agreement.
(a) 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 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 Servicer to assist the Issuer in performing its duties under
this Indenture.
(b) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the other Basic
Documents and in the instruments and agreements included in the Trust Estate,
including but not limited to preparing (or causing to be prepared) and 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
Basic Documents in accordance with and within the time periods provided for
herein and therein. Except as otherwise expressly provided therein, the Issuer
shall not waive, amend, modify, supplement or terminate any Basic Document or
any provision thereof.
(c) If a responsible officer of the Issuer shall have written notice or
actual knowledge of the occurrence of a Default, an Event of Default, a Class B
Default, a Class B Event of Default, a Servicer Termination Event or Funding
Termination Event, the Issuer shall promptly notify the Trustee, the Note
Purchasers and the Noteholders thereof in accordance with SECTION 11.4, and
shall specify in such notice the action, if any, the Issuer is taking in respect
of such default. If a Servicer Termination Event or Funding Termination Event
shall arise from the failure of the Servicer to perform any of its duties or
obligations under the Sale and Servicing Agreement with respect to the
Receivables, the Issuer shall take all reasonable steps available to it to
remedy such failure.
-16-
(d) The Issuer agrees that it shall not have any right to waive, and
shall not waive, timely performance or observance by the Servicer, the Purchaser
or the Seller of their respective duties under the Basic Documents except in
accordance with the terms thereof.
SECTION 3.8 NEGATIVE COVENANTS. So long as any class of Notes is
Outstanding, the Issuer shall not:
(i) except as expressly permitted by this Indenture or the
other Basic Documents, sell, transfer, exchange or otherwise dispose of
any of the properties or assets of the Issuer, including those included
in the Trust Estate, unless directed to do so by the Majority
Noteholders of the Highest Priority Class and the Controlling Note
Purchaser or the Majority Noteholders of the Highest Priority Class and
the Controlling Note Purchaser (or with respect to the Pledged
Subordinate Securities, the Class B Majority Noteholders, or with
respect to the UBS Cross Collateral (subject to the Intercreditor
Agreement), the Class B majority noteholders under the Bear Basic
Documents) have approved such disposition;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than
amounts properly withheld from such payments under the Code) or assert
any claim against any Note Purchaser or any present or former
Noteholders by reason of the payment of the taxes levied or assessed
upon any part of the Trust Estate; or
(iii) permit the validity or effectiveness of this Indenture,
the Intercreditor Agreement or any other Basic Document to be impaired;
or
(iv) (A) permit the lien created by this Indenture on the
Collateral in favor of the Trustee for the benefit of the Noteholders
and the Note Purchasers to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be released from any
covenants or obligations under this Indenture or any other Basic
Document except as may be expressly permitted hereby or thereby, (B)
permit any Lien (other than the lien of this Indenture and the other
Basic Documents) to be created on or extend to or otherwise arise upon
or burden any Collateral, or any part thereof or any interest therein
or the proceeds thereof (other than tax liens, mechanics' liens and
other liens that arise by operation of law, in each case on a Financed
Vehicle and arising solely as a result of an action or omission of the
related Obligor), (C) permit the lien of this Indenture not to
constitute a valid first priority (other than with respect to any such
tax, mechanics' or other similar lien) perfected security interest in
any portion of the Collateral; or
(v) (A) permit the lien created by this Indenture on the
Pledged Subordinate Securities in favor of the Trustee for the benefit
of the Class B Noteholders and the Class B Note Purchasers to be
amended, hypothecated, subordinated (other than with respect to any
such tax, mechanics' or other similar lien), terminated or discharged,
or permit any Person to be released from any covenants or obligations
under this Indenture or any other Basic Document except as may be
expressly permitted hereby or thereby, (B) permit any Lien (other than
the lien of this Indenture and the other Basic Documents) to be created
on or extend to or otherwise arise upon or burden any Pledged
Subordinate Securities, or any part thereof or any interest therein or
the proceeds thereof (other than tax liens, mechanics' liens and other
liens that arise by operation of law, in each case on a Financed
Vehicle and arising solely as a result of an action or omission of the
related Obligor), (C) permit the lien of this Indenture not to
constitute a valid first priority perfected security interest in any
portion of the Pledged Subordinate Securities (other than with respect
to any such tax, mechanics' or other similar lien); or
(vi) subject in each case to the terms and provisions of the
Intercreditor Agreement, (A) permit the lien created by this Indenture
on the UBS Cross Collateral in favor of the Bear Indenture Trustee for
the benefit of the Class B noteholders and the Class B note purchasers
under the Bear Basic Documents to be amended, hypothecated,
subordinated (other than with respect to any such tax, mechanics' or
other similar lien or the lien Granted pursuant to Granting Clause I of
this Indenture), terminated or discharged, or permit any Person to be
released from any covenants or obligations under this Indenture or any
other Basic Document except as may be expressly permitted hereby or
thereby, (B) permit any Lien (other than the lien of this Indenture and
the other Basic Documents) to be created on or extend to or otherwise
-17-
arise upon or burden any UBS Cross Collateral, or any part thereof or
any interest therein or the proceeds thereof (other than tax liens,
mechanics' liens and other liens that arise by operation of law, in
each case on a Financed Vehicle and arising solely as a result of an
action or omission of the related Obligor), (C) permit the lien of this
Indenture not to constitute a valid second priority perfected security
interest in any portion of the UBS Cross Collateral (subject only to
any such tax, mechanics' or other similar lien and the lien Granted
pursuant to Granting Clause I of this Indenture); or
(vii) amend or modify the provisions of any of the Basic
Documents except in accordance with the terms thereof.
SECTION 3.9 ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer will deliver
to the Trustee, the Noteholders and the Note Purchasers on or before March 31 of
each year, beginning March 31, 2007, an Officer's Certificate, dated as of
December 31 of the preceding year, stating, as to the Authorized Officer signing
such Officer's Certificate, that:
(i) a review of the activities of the Issuer during the
preceding year and of 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 and no event has
occurred and is continuing which is, or after notice or lapse of time
or both would become, an Event of Default, or a Class B Event of
Default, or, if there has been a default in the compliance of any such
condition or covenant, specifying each such default known to such
Authorized Officer and the nature and status thereof.
SECTION 3.10 ISSUER MAY CONSOLIDATE, ETC. Only with Consent. The Issuer
shall not consolidate or merge with or into any other Person, or convey or
transfer all or substantially all of its properties to any Person without the
prior written consent of the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class.
SECTION 3.11 SUCCESSOR OR TRANSFEREE. Upon any consolidation or merger
of the Issuer with the prior written consent of the Note Purchasers and the
Majority Noteholders of each class of Notes in accordance with SECTION 3.10, the
Person formed by or surviving such consolidation or merger (if other than the
Issuer) shall succeed to, and be substituted for, and may exercise every right
and power of, and be obligated to meet the requirements of the Issuer under this
Indenture and the other Basic Documents with the same effect as if such Person
had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties of
the Issuer with the prior written consent of the Note Purchasers and the
Majority Noteholders of each class of Notes in accordance with Section 3.10, the
Issuer will be released from every covenant and agreement of this Indenture to
be observed or performed on the part of the Issuer with respect to the Notes
immediately upon the delivery of written notice to the Trustee, the Note
Purchasers and the Noteholders stating that the Issuer is to be so released.
SECTION 3.12 NO OTHER BUSINESS. The Issuer will not at any time engage
in any other business activities than the purchase of the Receivables and the
Other Conveyed Property, pledging the Receivables and the other Collateral to
the Trustee for the benefit of the Note Purchasers and the Noteholders pursuant
to Granting Clause I of the Indenture, pledging the Pledged Subordinate
Securities to the Trustee for the benefit of the Class B Note Purchasers and the
Class B Noteholders pursuant to Granting Clause II of the Indenture, pledging
the UBS Cross Collateral, subject to the Intercreditor Agreements, to the Bear
-18-
Indenture Trustee for the benefit of the Class B note purchasers and the Class B
noteholders under the Bear Basic Documents pursuant to Granting Clause III of
the Indenture, transferring the Receivables and the Other Conveyed Property in
connection with Securitization Transactions and in connection with whole-loan
sales, acquiring the Pledged Subordinate Securities in connection with
Securitization Transactions, issuing the Notes and other activities relating to
the foregoing to the extent permitted by the organizational documents of the
Issuer as in effect on the date hereof, or as amended with the prior written
consent of the Controlling Note Purchaser. Without limitation of the foregoing,
the Issuer will not at any time be an issuer of securities other than the Notes
or a borrower under any loan or financing agreement, facility or other
arrangement other than the facilities established pursuant to this Agreement and
the other Basic Documents.
SECTION 3.13 NO BORROWING. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
Indebtedness except for (i) the Notes, and (ii) any other Indebtedness permitted
by or arising under the Basic Documents. The proceeds of the Notes shall be used
solely to fund the Issuer's purchase of the Related Receivables and the other
assets specified in the Sale and Servicing Agreement and to pay the Issuer's
organizational, transactional and start-up expenses.
SECTION 3.14 SERVICER'S OBLIGATIONS. The Issuer shall cause the
Servicer to comply with Sections 4.9, 4.10, 4.11 and 5.9 of the Sale and
Servicing Agreement.
SECTION 3.15 GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES. Except
as contemplated by the Basic Documents, the Issuer shall not make any loan or
advance or credit to, or guarantee (directly or indirectly or by an instrument
having the effect of 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, or 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.
SECTION 3.16 CAPITAL EXPENDITURES. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
SECTION 3.17 COMPLIANCE WITH LAWS. The Issuer shall comply with the
requirements of all applicable laws, including, without limitation, Consumer
Laws.
SECTION 3.18 RESTRICTED PAYMENTS. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to any owner of a beneficial interest in the Issuer or otherwise with
respect to any ownership or equity interest or security in or of the Issuer,
(ii) redeem, purchase, retire or otherwise acquire for value any such ownership
or equity interest or security or (iii) set aside or otherwise segregate any
amounts for any such purpose; provided, however, that the Issuer may make, or
cause to be made, distributions to the Trustee and to any owner of a beneficial
interest in the Issuer as permitted by, and to the extent funds are available
for such purpose from distributions under the Sale and Servicing Agreement. The
Issuer will not, directly or indirectly, make payments to or distributions from
the Collection Account and the other Pledged Accounts except in accordance with
this Indenture and the other Basic Documents.
SECTION 3.19 NOTICE OF EVENTS OF DEFAULT AND FUNDING TERMINATION
EVENTS. Upon a responsible officer of the Issuer having notice or actual
-19-
knowledge thereof, the Issuer agrees to give each of the Trustee, each Note
Purchaser and the Noteholders prompt written notice of each Event of Default
hereunder and each Funding Termination Event, Servicer Termination Event, Class
B Event of Default, Class B Default or other Default on the part of the Issuer,
the Servicer, the Purchaser or the Seller of its obligations under any Basic
Document.
SECTION 3.20 FURTHER INSTRUMENTS AND ACTS. Upon request of the Trustee,
any Note Purchaser or the Majority Noteholders of a Class of Notes, the Issuer
will execute and deliver such further instruments and do such further acts as
may be reasonably necessary or proper to carry out more effectively the purpose
of this Indenture and the other Basic Documents. SECTION 3.21 Amendments of Sale
and Servicing Agreement. The Issuer shall not agree to any amendment to Section
11.1 of the Sale and Servicing Agreement to eliminate any requirements
thereunder that the Trustee, the Controlling Note Purchaser, the Note Purchaser
of an affected class of Notes, or the Majority Noteholders of an affected class
of Notes consent to amendments thereto as provided therein.
SECTION 3.22 INCOME TAX CHARACTERIZATION. It is the intent of the
Issuer and the Noteholders that, for Federal, state and local income and
franchise tax purposes, the Notes will evidence indebtedness of the Issuer
secured by the Collateral (and the Pledged Subordinate Securities, in the case
of the Class B Notes). Each Noteholder, by its acceptance of a Note, agrees to
treat such Note for Federal, state and local income and franchise tax purposes
as indebtedness of the Issuer.
SECTION 3.23 SEPARATE EXISTENCE OF THE ISSUER. During the term of the
Indenture, the Issuer shall observe and comply with the applicable legal
requirements for the recognition of the Issuer as a legal entity separate and
apart from its Affiliates, including without limitation, those requirements set
forth in Section 9(b) of the LLC Agreement.
SECTION 3.24 AMENDMENT OF ISSUER'S ORGANIZATIONAL DOCUMENTS. During the
term of the Indenture, the Issuer shall not amend the LLC Agreement except in
accordance with the provisions thereof and with the prior written consent of the
Controlling Note Purchaser and the Majority Noteholders of the Highest Priority
Class.
SECTION 3.25 OTHER AGREEMENTS. The Issuer shall not enter into any
agreement that does not contain non-petition or limited recourse language
acceptable to the Controlling Note Purchaser with respect to the Issuer.
SECTION 3.26 RULE 144A INFORMATION. At any time when the Issuer is not
subject to Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended, upon the request of a Noteholder, the Issuer shall promptly furnish to
such Noteholder or to a prospective purchaser of a Note designated by such
Noteholder, as the case may be, the information required to be delivered
pursuant to Rule 144A(d)(4) under the Securities Act ("Rule 144A Information")
in order to permit compliance by such Noteholder with Rule 144A in connection
with the resale of a Note by such Noteholder; provided, however, that the Issuer
shall not be required to furnish Rule 144A Information in connection with any
request made on or after the date which is three years from the later of (i) the
most recent renewal of the term of the applicable Commitment pursuant to Section
2.05 of the applicable Note Purchase Agreement, (ii) the date such Note (or any
predecessor Note) was acquired from the Issuer or (iii) the date such Note (or
any predecessor Note) was last acquired from an "affiliate" of the Issuer within
-20-
the meaning of Rule 144 under the Securities Act; and provided further that the
Issuer shall not be required to furnish such information at any time to a
prospective purchaser located outside of the United States who is not a "United
States Person" within the meaning of Regulation S under the Securities Act if
such Note may then be sold to such prospective purchaser in accordance with Rule
904 under the Securities Act (or any successor provision thereto).
SECTION 3.27 CHANGE OF CONTROL. CPS will and shall at all times be the
legal and beneficial owner of all of the issued and outstanding membership
interests of the Issuer.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 SATISFACTION AND DISCHARGE OF INDENTURE.
(a) This Indenture shall cease to be of further effect with respect to
the Class A Notes except as to (i) rights of registration of transfer and
exchange, (ii) substitution of mutilated, destroyed, lost or stolen Class A
Notes, (iii) rights of the Class A Noteholders to receive payments of principal
thereof and interest thereon and rights of the Class A Note Purchaser to receive
payments in respect of amounts owed by the Issuer to the Class A Note Purchaser
under the Basic Documents, (iv) SECTIONS 3.3, 3.4, 3.5, 3.6, 3.8, 3.10, 3.11,
3.18, 3.19, 3.20, 3.21, 3.23, 3.24 and 11.17, (v) the rights, obligations and
immunities of the Trustee hereunder (including the rights of the Trustee under
SECTION 6.7 and the obligations of the Trustee under Section 4.2) and (vi) the
rights of the Class A Noteholders and the Class A Note Purchaser as
beneficiaries hereof with respect to the property so deposited with the Trustee
payable to all or any of them, and the Trustee, on demand of and at the expense
of the Issuer, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to the Class A Notes, when:
(i) the Class A Notes theretofore authenticated and delivered
(other than (i) Class A Notes that have been destroyed, lost or stolen
and that have been replaced or paid as provided in Section 2.6 and (ii)
Class A Notes for which payment money has theretofore been deposited in
trust or segregated and held in trust by the Issuer and thereafter
repaid to the Issuer or discharged from such trust, as provided in
Section 3.3) have been delivered to the Trustee for cancellation;
(ii) the Issuer has paid or caused to be paid all Secured
Obligations in respect of the Class A Notes and all other amounts due
and owing to the Class A Note Purchaser and the Class A Noteholders
pursuant to the Basic Documents; and
(iii) the Issuer has delivered to the Trustee, the Class A
Noteholders and the Class A Note Purchaser an Officer's Certificate
meeting the applicable requirements of Section 11.1(a) and stating that
all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with.
(b) This Indenture shall cease to be of further effect with respect to
the Class B Notes except as to (i) rights of registration of transfer and
exchange, (ii) substitution of mutilated, destroyed, lost or stolen Class B
Notes, (iii) rights of the Class B Noteholders to receive payments of principal
thereof and interest thereon and rights of each Class B Note Purchaser to
receive payments in respect of amounts owed by the Issuer to each Class B Note
Purchaser under the Basic Documents, (iv) SECTIONS 3.3, 3.4, 3.5, 3.6, 3.8,
3.10, 3.11, 3.18, 3.19, 3.20, 3.21, 3.23, 3.24 and 11.17, (v) the rights,
obligations and immunities of the Trustee hereunder (including the rights of the
Trustee under SECTION 6.7 and the obligations of the Trustee under SECTION 4.2)
and (vi) the rights of the Class B Noteholders and each Class B Note Purchaser
as beneficiaries hereof with respect to the property so deposited with the
Trustee payable to all or any of them, and the Trustee, on demand of and at the
expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to the Class B Notes,
when:
-21-
(i) the Class B Notes theretofore authenticated and delivered
(other than (i) Class B Notes that have been destroyed, lost or stolen
and that have been replaced or paid as provided in Section 2.6 and (ii)
Class B Notes for which payment money has theretofore been deposited in
trust or segregated and held in trust by the Issuer and thereafter
repaid to the Issuer or discharged from such trust, as provided in
Section 3.3) have been delivered to the Trustee for cancellation;
(ii) the Issuer has paid or caused to be paid all Secured
Obligations in respect of each class of Notes (and all Bear Secured
Obligations in the case of the Class B Notes) and all other amounts due
and owing to the Note Purchasers and the Noteholders under the Basic
Documents; and
(iii) the Issuer has delivered to the Trustee, the Class B
Noteholders and each Class B Note Purchaser an Officer's Certificate
meeting the applicable requirements of Section 11.1(a) and stating that
all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with.
SECTION 4.2 APPLICATION OF TRUST MONEY. All moneys deposited with the
Trustee pursuant to SECTION 4.1 or SECTION 4.3 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Notes, this Indenture
and the other Basic Documents, to the payment, either directly or through the
Note Paying Agent, as the Trustee may determine, to the applicable Noteholders
and the applicable Note Purchasers for the payment or redemption of which such
moneys have been deposited with the Trustee, of all sums due and to become due
thereon for principal and interest (in the case of the Noteholders) and all sums
due and payable by the Issuer under the Basic Documents (in the case of any Note
Purchaser); but such moneys need not be segregated from other funds except to
the extent required herein, in the Sale and Servicing Agreement or in the other
Basic Documents or required by law. Any funds remaining with the Trustee or on
deposit in the Pledged Accounts following the repayment in full of the Notes,
the other Secured Obligations, the termination of the Commitments, the payment
in full of the Notes and all other amounts owed to the Noteholders, the Note
Purchasers, Trustee and Backup Servicer under the Basic Documents, and the
satisfaction and discharge of this Indenture, shall be remitted to the Deposit
Account.
SECTION 4.3 Repayment of Moneys Held by Note Paying Agent. In
connection with the satisfaction and discharge of this Indenture with respect to
a class of Notes, all moneys then held by the Note Paying Agent other than the
Trustee under the provisions of this Indenture with respect to such class of
Notes shall, upon demand of the Issuer, be remitted to the Trustee to be held
and applied according to SECTION 4.2 and thereupon the Note Paying Agent shall
be released from all further liability with respect to such moneys.
ARTICLE V
REMEDIES
SECTION 5.1 EVENTS OF DEFAULT.
(a) "EVENT OF DEFAULT", wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
-22-
(i) default in the payment of (A) any interest on the Highest
Priority Class of Notes or any other amount (except principal) due with
respect to the Highest Priority Class of Notes or (B) any amount in
excess of $50,000 due to the Controlling Note Purchaser pursuant to the
Basic Documents, when the same becomes due and payable, which default
continues for a period of two (2) days;
(ii) default in the payment of the principal of or any
installment of the principal of the Highest Priority Class of Notes
when the same becomes due and payable;
(iii) default in the observance or performance of any covenant
or agreement of the Issuer, the Purchaser, the Seller or the Servicer
made in any Basic Document (other than a covenant or agreement, a
default in the observance or performance of which is elsewhere in this
Section specifically dealt with and other than the failure by the
Seller or the Servicer to repurchase any Receivable in accordance with
the terms of the Sale and Servicing Agreement), or any representation
or warranty of the Issuer, the Purchaser, the Seller or the Servicer
made in any Basic Document or any Original Basic Document or in any
certificate or other writing delivered pursuant to any Basic Document
or Original Basic Document or in connection therewith (including any
Servicer's Certificate or any Borrowing Base Certificate with respect
to the Highest Priority Class) proving to have been incorrect in any
material respect as of the time when the same shall have been made or
deemed to have been made, and such default shall continue or not be
cured within 30 days from written notice by the Controlling Note
Purchaser or a Noteholder of the Highest Priority Class, or the
circumstance or condition in respect of which such misrepresentation or
warranty was incorrect shall not have been eliminated or otherwise
cured within 30 days from written notice by the Noteholders of the
Highest Priority Class or the Controlling Note Purchaser; provided that
no breach shall be deemed to occur hereunder in respect of any
representation or warranty relating to eligibility of any Receivable on
the Class A Closing Date, the Class B Closing Date or any related
Funding Date to the extent the Seller has repurchased such Receivable
in accordance with the provisions of the Sale and Servicing Agreement;
(iv) the failure by the Seller or the Servicer to repurchase
any Receivable in accordance with the terms of the Sale and Servicing
Agreement;
(v) an Insolvency Event with respect to the Issuer, the Seller
or the Servicer shall have occurred;
(vi) a Borrowing Base Deficiency with respect to the Highest
Priority Class shall exist and not be cured within two (2) Business
Days;
(vii) the Internal Revenue Service shall file notice of a Lien
pursuant to Section 6323 of the Code with regard to any assets of the
Issuer or any material portion of the assets of the Seller and such
Lien shall not have been released within 30 days, or the Pension
Benefit Guaranty Corporation shall file notice of a Lien pursuant to
Section 4068 of ERISA with regard to any of the assets of the Issuer or
the Seller and such Lien shall not have been released within 30 days;
(viii) (a) any Basic Document or any Lien granted thereunder
by the Issuer or the Seller shall (except in accordance with its
terms), in whole or in part, terminate, cease to be effective or cease
to be the legally valid, binding and enforceable obligation of the
Issuer or the Seller; or (b) the Issuer or the Seller or any other
party shall, directly or indirectly, contest in any manner such
effectiveness, validity, binding nature or enforceability of any Basic
Document;
(ix) a Servicer Termination Event shall have occurred;
(x) the Issuer or the Seller shall fail to pay any principal
of or premium or interest on any indebtedness having a principal amount
of $250,000 or $1,000,000, respectively, or greater when the same
becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise) and such failure shall
continue after the applicable grace period, if any, specified in the
agreement or instrument relating to such indebtedness; or any other
default under any agreement or instrument relating to any such
indebtedness of the Issuer or the Seller, as applicable, or any other
-23-
event, shall occur and shall continue after the applicable grace
period, if any, specified in such agreement or instrument if the effect
of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such indebtedness; or any such
indebtedness shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled required prepayment),
redeemed, purchased or defeased, or an offer to prepay, redeem,
purchase or defease such indebtedness shall be required to be made, in
each case, prior to the stated maturity thereof;
(xi) a Change of Control or a Material Adverse Change (in the
reasonable opinion of the Controlling Note Purchaser) shall have
occurred with respect to the Issuer or the Seller;
(xii) the Issuer shall become an investment company required
to be registered under the Investment Company Act;
(xiii) any final judgment or ruling shall have been rendered
against, or any settlement entered into by, the Seller or any
subsidiary thereof, excluding the Issuer, which judgment, ruling or
settlement exceeds, in the aggregate, $6,000,000 or any final judgment
or ruling shall have been rendered against the Issuer; provided, in
either case, that such final judgment, ruling or settlement shall have
remained unpaid, and enforcement thereof shall have remained unstayed
and unbonded, for a period in excess of 30 days from the date of entry
of such judgment or ruling or the date of effectiveness of such
settlement;
(xiv) the Trustee shall for any reason fail to have a first
priority perfected security interest in the Collateral for the benefit
of the Noteholders and the Note Purchasers; or
(xv) any Basic Document shall be terminated or cease to be in
full force or effect; provided, however, in the case of a termination
of any Lockbox Agreement, an Event of Default shall occur only upon the
failure of the Seller or the Issuer to obtain a successor lockbox
arrangement reasonably acceptable to the Controlling Note Purchaser
within thirty (30) days of such termination.
(b) The Issuer shall deliver to the Trustee, each Note Purchaser and
each Noteholder, within two days after the occurrence thereof, written notice in
the form of an Officer's Certificate of any Event of Default which has occurred
or any event which either with the giving of notice or the lapse of time, or
both, would become an Event of Default, its status and what action the Issuer is
taking or proposes to take with respect thereto.
(c) After the earlier of the receipt of notice by the Trustee and the
date of actual knowledge by a Responsible Officer of the Trustee of the
occurrence of any Default or Event of Default hereunder, the Trustee shall give
prompt written notice to each Note Purchaser and each Noteholder of each such
Default or Event of Default hereunder so known to the Trustee.
SECTION 5.2 RIGHTS UPON EVENT OF DEFAULT. If an Event of Default or a
Class A Funding Termination Event specified in clauses (i) through (iii) of the
definition thereof shall have occurred and be continuing, the Trustee may, and
at the direction of the Controlling Note Purchaser and the Majority Noteholders
of the Highest Priority Class shall, and with respect to an Event of Default
pursuant to Section 5.1(a)(v) hereof, the Trustee shall declare the Notes to be
immediately due and payable at par, together with accrued interest thereon
(calculated for these purposes using the applicable Default Applicable Margin).
In addition, if an Event of Default shall have occurred and be continuing, the
Trustee may, and at the direction of the Controlling Note Purchaser and the
Majority Noteholders of the Highest Priority Class shall, exercise any of the
remedies specified in Section 5.4.
At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article V provided, the
Controlling Note Purchaser and the Majority Noteholders of the Highest Priority
Class may, by written notice to the Issuer and the Trustee, rescind and annul
such declaration and its consequences if the Issuer has paid or deposited with
the Trustee a sum sufficient to pay:
-24-
(i) all payments of principal of and interest (calculated for
these purposes using the applicable Default Applicable Margin) on the
Notes, all amounts due to the Note Purchasers under the Basic
Documents, and all other amounts that would then be due hereunder, upon
the Notes or under the Basic Documents if the Event of Default giving
rise to such acceleration had not occurred; and
(ii) all sums paid or advanced by the Trustee hereunder and
the reasonable compensation, expenses, disbursements and advances of
the Trustee and its agents and counsel; and
(iii) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such acceleration,
have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any
right consequent thereto.
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.
(a) The Issuer covenants that if (i) default is made in the payment of
any interest on, or principal of, the Notes, or any amount due from the Issuer
to any Note Purchaser under the Basic Documents, when the same becomes due and
payable, the Issuer will, upon demand of the Trustee, pay to the Trustee, for
the benefit of the Noteholders and the Note Purchasers, as applicable, the whole
amount then due and payable on the Notes for principal and interest, with
interest upon the overdue principal, and, to the extent payment at such rate of
interest shall be legally enforceable, upon overdue installments of interest, at
the applicable Note Interest Rate, all other amounts due and owing by the Issuer
under the Basic Documents and, in each case, in addition thereto such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee and its agents and counsel.
(b) If an Event of Default occurs and is continuing, the Trustee may in
its discretion subject to the prior written consent of the Controlling Note
Purchaser and the Majority Noteholders of the Highest Priority Class and shall,
at the direction of the Controlling Note Purchaser and the Majority Noteholders
of the Highest Priority Class, proceed to protect and enforce its rights and the
rights of the Note Purchasers and the Noteholders by such appropriate
Proceedings as the Trustee, the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class shall deem most effective to protect
and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture, any other Basic Document or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy
or legal or equitable right vested in the Trustee by this Indenture, any other
Basic Document or by law.
(c) [RESERVED].
(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 or any portion thereof, proceedings under Title 11 of the
United States Code or any other applicable Federal or state bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, sequestrator or similar official shall
have been appointed for or taken possession of the Issuer or its property or
such other obligor or Person, or in case of any other comparable judicial
proceedings relative to the Issuer or other obligor upon the Notes, or to the
creditors or property of the Issuer or such other obligor, the Trustee,
irrespective of whether the principal of the Notes shall then be due and payable
as therein expressed or by declaration or otherwise and irrespective of whether
the Trustee shall have made any demand pursuant to the provisions of this
Section, shall be entitled and empowered, by intervention in such proceedings or
otherwise:
(i) to file and prove a claim or claims for the whole amount
of principal and interest owing and unpaid in respect of the Notes and
the whole amount then due to the Note Purchasers under the Basic
Documents and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for reasonable compensation to the Trustee and
each predecessor Trustee, and their respective agents, attorneys and
counsel, and for reimbursement of all expenses and liabilities
-25-
incurred, and all advances made, by the Trustee and each predecessor
Trustee, except as a result of negligence, bad faith or willful
misconduct) and of the Note Purchasers and the Noteholders allowed in
such proceedings;
(ii) unless prohibited by applicable law and regulations, to
vote on behalf of the Noteholders and the Note Purchasers in any
election of a trustee, a standby trustee or person performing similar
functions in any such proceedings;
(iii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders, the Note
Purchasers and of the Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Trustee, the Note Purchasers 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 the Noteholders and each Note
Purchaser to make payments to the Trustee, and, in the event that the Trustee
shall consent to the making of payments directly to the Noteholders or the Note
Purchasers, to pay to the Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Trustee, each predecessor Trustee and their
respective agents, attorneys and counsel, and all other expenses and liabilities
incurred, and all advances made, by the Trustee and each predecessor Trustee
except as a result of negligence or bad faith.
(e) Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or vote for or accept or adopt on behalf of any
Noteholder or any Note Purchaser any plan of reorganization, arrangement,
adjustment or composition affecting any class of the Notes or the rights of any
Noteholder or any Note Purchaser or to authorize the Trustee to vote in respect
of the claim of any Noteholder or any Note Purchaser 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,
any other Basic Document or under the Notes, may be enforced by the 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 Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment, subject to the payment of the
expenses, disbursements and compensation of the Trustee, each predecessor
Trustee and their respective agents and attorneys, shall be for the benefit of
the Noteholders and the Note Purchasers.
(g) In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture or any other
Basic Document), the Trustee shall be held to represent the Note Purchasers and
the Noteholders, and it shall not be necessary to make the Note Purchasers or
the Noteholders a party to any such proceedings. Notwithstanding the foregoing,
nothing contained in this Indenture shall be deemed to prohibit a Note Purchaser
or a Noteholder from representing itself in any such action or proceeding.
SECTION 5.4 REMEDIES.
(a) If an Event of Default shall have occurred and be continuing, the
Controlling Note Purchaser and the Majority Noteholders of the Highest Priority
Class may do one or more of the following (subject to SECTION 5.5):
(i) institute or direct the Trustee to institute Proceedings
in its own name and as trustee of an express trust for the collection
of all amounts then payable by the Issuer under any Basic Document, on
the Notes or under this Indenture with respect thereto, and all amounts
due and owing to any Noteholder or any Note Purchaser pursuant to the
Basic Documents, whether by declaration or otherwise, enforce any
judgment obtained, and collect from the Issuer and any other obligor
upon the Notes or such other obligations moneys adjudged due;
-26-
(ii) institute or direct the Trustee to institute Proceedings
from time to time for the complete or partial foreclosure of this
Indenture with respect to the Collateral;
(iii) exercise or direct the Trustee to exercise any remedies
of a secured party under the UCC with respect to the Collateral and
take any other appropriate action to protect and enforce the rights and
remedies of the Trustee, the Note Purchasers and the Noteholders under
the Basic Documents; and
(iv) sell or direct the Trustee to sell the Collateral or any
portion thereof or rights or interest therein, at one or more public or
private sales (including, without limitation, the sale of the
Collateral in connection with a securitization thereof) called and
conducted in any manner permitted by law,
in each case without giving consideration to whether the proceeds of
any such sale shall be sufficient to pay amounts due and owing to the Class B
Note Purchasers and the Class B Noteholders pursuant to the Basic Documents.
(b) If a Class B Event of Default shall have occurred and be
continuing, the Class B Note Purchasers and the Class B Majority Noteholders may
do one or more of the following, subject in each case to the terms and
provisions of the Intercreditor Agreement:
(i) institute or direct the Trustee to institute Proceedings
from time to time for the complete or partial foreclosure of this
Indenture solely with respect to the Pledged Subordinate Securities;
(ii) exercise or direct the Trustee to exercise any remedies
of a secured party under the UCC solely with respect to the Pledged
Subordinate Securities and take any other appropriate action to protect
and enforce the rights and remedies of the Trustee, the Class B Note
Purchasers and the Class B Noteholders under the Basic Documents solely
with respect to the Pledged Subordinate Securities; and
(iii) sell or direct the Trustee to sell the Pledged
Subordinate Securities 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.
(c) If a Class B Event of Default shall have occurred and be
continuing, the Class B note purchasers and the Class B majority noteholders
under the Bear Basic Documents may do one or more of the following, subject in
each case to the terms and provisions of the Intercreditor Agreement:
(i) institute or direct the Bear Indenture Trustee to
institute Proceedings from time to time for the complete or partial
foreclosure of this Indenture solely with respect to the UBS Cross
Collateral;
(ii) exercise or direct the Bear Indenture Trustee to exercise
any remedies of a secured party under the UCC solely with respect to
the UBS Cross Collateral and take any other appropriate action to
protect and enforce the rights and remedies of the Class B note
purchasers and the Class B noteholders under the Bear Basic Documents
solely with respect to the UBS Cross Collateral; and
(iii) sell or direct the Bear Indenture Trustee to sell the
UBS Cross Collateral 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.
SECTION 5.5 OPTIONAL PRESERVATION OF THE RECEIVABLES. If the Notes have
been declared to be due and payable under Section 5.2 following an Event of
Default and such declaration and its consequences have not been rescinded and
annulled, the Trustee may, but need not, elect to maintain possession of the
Collateral with the prior written consent of the Controlling Note Purchaser and
the Majority Noteholders of the Highest Priority Class. It is the desire of the
-27-
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, subject to the
Intercreditor Agreement, the Trustee shall take such desire into account when
determining whether or not to maintain possession of the Collateral. In
determining whether to maintain possession of the Collateral, the Trustee may,
but need not, obtain and rely upon an opinion of an Independent investment
banking or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Collateral for such purpose.
SECTION 5.6 PRIORITIES.
(a) If the Trustee collects any money or property in respect of the
Collateral pursuant to this Article V, it shall pay out the money or property in
the following order of priority:
(i) FIRST: to the Trustee for amounts due under Section 6.7;
(ii) SECOND: to the Class A Noteholders for amounts due and
unpaid on the Class A Notes in respect of interest (including any
premium), ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class A Notes in
respect of interest (including any premium);
(iii) THIRD: to the Class A Noteholders for amounts due and
unpaid on the Class A Notes in respect of principal, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class A Notes in respect of principal, until the
outstanding principal amount of the Class A Notes is reduced to zero;
(iv) FOURTH: to the Class A Note Purchaser for any amounts due
and owing thereto under the Basic Documents;
(v) FIFTH: to the Class A Noteholders, ratably, without
preference or priority of any kind, for any amounts due and owing
thereto under the Basic Documents;
(vi) SIXTH: to the Class B Noteholders for amounts due and
unpaid on the Class B Notes in respect of interest (including any
premium), ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class B Notes in
respect of interest (including any premium);
(vii) SEVENTH: to the Class B Noteholders for amounts due and
unpaid on the Class B Notes in respect of principal, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class B Notes in respect of principal, until the
outstanding principal amount of the Class B Notes is reduced to zero;
(viii) EIGHTH: to each Class B Note Purchaser, ratably,
without preference or priority of any kind, for any amounts due and
owing thereto under the Basic Documents;
(ix) NINTH: to the Class B Noteholders, ratably, without
preference or priority of any kind, for any amounts due and owing
thereto under the Basic Documents;
(x) TENTH: to the Bear Indenture Trustee for the benefit of
the Class B note purchasers and the Class B noteholders under the Bear
Basic Documents, ratably, without preference or priority of any kind,
for any amounts due and owing thereto in respect of the Bear Secured
Obligations; and
(xi) ELEVENTH: any excess amounts remaining after making the
payments described in clauses FIRST through TENTH above, to be applied
as Available Funds pursuant to Section 5.7(a) of the Sale and Servicing
Agreement to the extent that any amounts payable thereunder have not
been previously paid pursuant to clauses FIRST through TENTH above.
-28-
(b) If the Trustee collects any money or property in respect of the
Pledged Subordinate Securities pursuant to this Article V, it shall pay out the
money or property in the following order of priority:
(i) FIRST: to the Class B Noteholders for amounts due and
unpaid on the Class B Notes in respect of interest (including any
premium), ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class B Notes in
respect of interest (including any premium);
(ii) SECOND: to the Class B Noteholders for amounts due and
unpaid on the Class B Notes in respect of principal, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class B Notes in respect of principal, until the
outstanding principal amount of the Class B Notes is reduced to zero;
(iii) THIRD: to each Class B Note Purchaser, ratably, without
preference or priority of any kind, for any amounts due and owing
thereto under the Basic Documents;
(iv) FOURTH: to the Class B Noteholders, ratably, without
preference or priority of any kind, for any amounts due and owing
thereto under the Basic Documents;
(v) FIFTH: to the Bear Indenture Trustee for the benefit of
the Class B note purchasers and the Class B noteholders under the Bear
Basic Documents, ratably, without preference or priority of any kind,
for any amounts due and owing thereto in respect of the Bear Secured
Obligations; and
(vi) SIXTH: any excess amounts remaining after making the
payments described in clauses FIRST through FIFTH above, to be applied
as Class B Available Funds pursuant to Section 5.7(b) of the Sale and
Servicing Agreement to the extent that any amounts payable thereunder
have not been previously paid pursuant to clauses FIRST through FIFTH
above.
(c) The Trustee may fix a record date and Settlement Date for any
payment to the Note Purchasers and the Noteholders pursuant to this Section. At
least 15 days before such record date the Trustee shall mail to the Issuer, each
Note Purchaser and each Noteholder a notice that states such record date, the
Settlement Date and the amount to be paid.
SECTION 5.7 LIMITATION OF SUITS.
(a) The Controlling Note Purchaser shall have the 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, in
each case with respect to the Collateral or the UBS Cross Collateral, provided,
that:
(i) the Majority Noteholders of the Highest Priority Class
have previously given written notice to the Trustee of a continuing
Event of Default;
(ii) the Majority Noteholders of the Highest Priority Class
have made a written request to the Trustee to institute such proceeding
in respect of such Event of Default in its own name as Trustee
hereunder;
(iii) the Majority Noteholders of the Highest Priority Class
have offered to the Trustee indemnity reasonably satisfactory to it
against the costs, expenses and liabilities to be incurred in complying
with such request; and
-29-
(iv) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute such
proceedings;
it being understood and intended that no Holder of a Note 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 Holder of the
Notes or to obtain or to seek to obtain priority or preference over any other
Holder or to enforce any right under this Indenture, except in the manner
provided herein or in the other Basic Documents, in each case subject to the
Intercreditor Agreement, and it being understood that if a Note is held by the
Controlling Note Purchaser or an Affiliate thereof, the Holder may directly
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.
(b) The Class B Note Purchasers shall have the 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, in each
case solely with respect to the Pledged Subordinate Securities and the Class B
Available Funds, provided, that:
(i) the Class B Majority Noteholders have previously given
written notice to the Trustee of a continuing Class B Event of Default;
(ii) the Class B Majority Noteholders have made a written
request to the Trustee to institute such proceeding in respect of such
Class B Event of Default in its own name as Trustee hereunder;
(iii) the Class B Majority Noteholders have offered to the
Trustee indemnity reasonably satisfactory to it against the costs,
expenses and liabilities to be incurred in complying with such request;
and
(iv) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute such
proceedings;
it being understood and intended that no Holder of a Class B Note 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 Holder or
to obtain or to seek to obtain priority or preference over any other Holder or
to enforce any right under this Indenture, in each case solely with respect to
the Pledged Subordinate Securities, except in the manner provided herein or in
the other Basic Documents and it being understood that if a Class B Note is held
by the Controlling Note Purchaser or an Affiliate thereof, the Holder may
directly 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.
(c) Only the Bear Indenture Trustee shall have the 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, in
each case solely with respect to the UBS Cross Collateral and subject to the
prior Lien thereon Granted pursuant to Granting Clause I of this Indenture and
to the terms and provisions of the Intercreditor Agreement, provided, that:
(i) the Class B majority noteholders under the Bear Basic
Documents shall have previously given written notice to the Bear
Indenture Trustee of a continuing Class B Event of Default pursuant to
the Bear Basic Documents;
(ii) the Class B majority noteholders under the Bear Basic
Documents shall have made a written request to the Bear Indenture
Trustee to institute such proceeding in respect of such Class B Event
of Default in its own name as Bear Indenture Trustee thereunder;
(iii) the Class B majority noteholders under the Bear Basic
Documents shall have offered to the Bear Indenture Trustee indemnity
reasonably satisfactory to it against the costs, expenses and
liabilities to be incurred in complying with such request; and
-30-
(iv) the Bear Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity shall have has failed to
institute such proceedings;
it being understood and intended that no Class B noteholder under the Bear Basic
Documents shall have any right in any manner whatever by virtue of, or by
availing of, any provision of this Indenture, any other Basic Document or any
Bear Basic Document to affect, disturb or prejudice the rights of any other
Class B noteholder under the Bear Basic Documents or to obtain or to seek to
obtain priority or preference over any other Class B noteholder under the Bear
Basic Documents or to enforce any right under this Indenture, except in the
manner provided herein, in the other Basic Documents or in the Bear Basic
Documents.
SECTION 5.8 UNCONDITIONAL RIGHTS OF THE NOTEHOLDERS TO RECEIVE
PRINCIPAL AND INTEREST. Notwithstanding any other provisions of this Indenture,
(i) each Noteholder shall have the right, which is absolute and unconditional,
to receive payment of the applicable Percentage Interest of principal of and
interest, if any, on such Note on or after the respective due dates thereof
expressed in such Note or in this Indenture in accordance with the priorities
specified in Section 5.8 of the Sale and Servicing Agreement and Section 5.6(a)
of this Indenture, and (ii) each Note Purchaser shall have the right, which is
absolute and unconditional, to receive payment of all amounts owed to it by the
Issuer under the Basic Documents when the same shall become due (in accordance
with the priorities specified in Section 5.8 of the Sale and Servicing Agreement
and Section 5.6(a) of this Indenture), and, in each case, to institute suit for
the enforcement of any such payment, and such right shall not be impaired
without the consent of the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class, as applicable.
SECTION 5.9 RESTORATION OF RIGHTS AND REMEDIES. If any Note Purchaser
or any Noteholder has instituted any proceeding to enforce any right or remedy
under this Indenture and such proceeding has been discontinued or abandoned for
any reason or has been determined adversely to the Trustee, such Note Purchaser
or to such Noteholder, then and in every such case the Issuer, the Trustee, such
Note Purchaser and such Noteholder shall, subject to any determination in such
Proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee, such Note
Purchaser and such Noteholder shall continue as though no such proceeding had
been instituted.
SECTION 5.10 RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein
conferred upon or reserved to any Note Purchaser or any Noteholder is intended
to be exclusive of any other right or remedy, and every right and remedy shall,
to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.11 DELAY OR OMISSION NOT A WAIVER. No delay or omission of
any Note Purchaser or any Noteholder to exercise any right or remedy accruing
upon any Default, Event of Default, Class B Default or Class B Event of Default
shall impair any such right or remedy or constitute a waiver of any such
Default, Event of Default, Class B Default or Class B Event of Default or an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Trustee, any Note Purchaser or any Noteholder may be exercised from time
to time, and as often as may be deemed expedient, by the Trustee, such Note
Purchaser or such Noteholder, as the case may be.
SECTION 5.12 [RESERVED].
SECTION 5.13 WAIVER OF PAST DEFAULTS. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.2, the
-31-
Controlling Note Purchaser and the Majority Noteholders of the Highest Priority
Class may waive any past Default or Event of Default and its consequences except
a Default or Event of Default (i) in payment of principal of or interest on the
Highest Priority Class of Notes or (ii) in respect of a covenant or provision
hereof which cannot be modified or amended without the consent of each affected
Note Purchaser and each affected Noteholder. In the case of any such waiver, the
Issuer, the Trustee, the Note Purchasers 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 Default or Event of Default or impair
any right consequent thereto.
Upon any such waiver, such Default or Event of Default shall cease to
exist and be deemed to have been cured and not to have occurred, and any Event
of Default arising therefrom shall be deemed to have been cured and not to have
occurred, for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or Event of Default or impair any right
consequent thereto.
SECTION 5.14 UNDERTAKING FOR COSTS. Each of the Issuer and the Trustee
agrees, and each Note Purchaser and each Noteholder, by its acceptance of a
Note, shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (a) any suit instituted by the
Trustee, (b) any suit instituted by any Note Purchaser or Noteholders holding in
the aggregate more than 10% of Percentage Interests of any class of Notes or (c)
any suit instituted by the Noteholders for the enforcement of the payment of
principal of or interest on the Notes on or after the respective due dates
expressed in the Notes and in this Indenture.
SECTION 5.15 WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants (to
the extent that it may lawfully do so) that it will not at any time insist upon,
or plead or in any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and
the Issuer (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power and any right of the Issuer to take
such action shall be suspended.
SECTION 5.16 SALE OF TRUST ESTATE.
(a) To the extent permitted by applicable law, the Trustee shall not in
any private sale sell to a third party the Collateral, or any portion thereof
pursuant to Section 5.4(a)(iv) unless,
(i) the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class consent to or direct the
Trustee in writing to make such sale; or
(ii) the proceeds of such sale would be not less than the sum
of (x) all amounts due on the entire unpaid principal amount of each
class of Notes and interest due or to become due thereon in accordance
with Section 5.6(a) hereof on the Settlement Date next succeeding the
date of such sale and (y) all amounts due the Note Purchasers and the
Noteholders under the Basic Documents.
The Trustee shall act upon the direction of the Controlling Note
Purchaser and the Majority Noteholders of the Highest Priority Class pursuant to
Section 5.16(a)(i) without giving consideration to whether the proceeds of any
such sale shall be sufficient to pay amounts due and owing to the Class B Note
Purchasers and the Class B Noteholders pursuant to the Basic Documents.
-32-
(b) To the extent permitted by applicable law, the Trustee shall not in
any private sale sell to a third party the Pledged Subordinate Securities, or
any portion thereof pursuant to Section 5.4(b)(iii) unless,
(i) the Class B Note Purchasers and the Class B Majority
Noteholders consent to or direct the Trustee in writing to make such
sale; or
(ii) the proceeds of such sale would be not less than the sum
of (x) all amounts due on the entire unpaid principal amount of the
Class B Notes and interest due or to become due thereon in accordance
with Section 5.6(b) hereof on the Settlement Date next succeeding the
date of such sale and (y) all amounts due the Class B Note Purchasers
and the Class B Noteholders under the Basic Documents.
(c) To the extent permitted by applicable law and subject to the prior
Lien Granted pursuant to Granting Clause I of this Indenture and to the terms
and provisions of the Intercreditor Agreement, the Bear Indenture Trustee shall
not in any private sale sell to a third party the UBS Cross Collateral, or any
portion thereof pursuant to Section 5.4(c)(iii) unless,
(i) the Class B note purchasers and the Class B majority
noteholders under the Bear Basic Documents consent to or direct the
Bear Indenture Trustee in writing to make such sale; or
(ii) the proceeds of such sale would be not less than the sum
of (x) all amounts due on the entire unpaid principal amount of the
Class B notes under the Bear Basic Documents and interest due or to
become due thereon in accordance with Section 5.6(b) hereof on the
Settlement Date next succeeding the date of such sale and (y) all
amounts due the Class B note purchasers and the Class B noteholders
under the Bear Basic Documents.
(d) For any public sale of the Trust Estate pursuant to Section
5.4(a)(iv) or 5.4(b)(iii), the Trustee shall have provided the applicable Note
Purchasers, the applicable Noteholders and the Bear Indenture Trustee, if
applicable, with notice of such sale at least two weeks in advance of such sale
which notice shall specify the date, time and location of such sale. For any
public sale of the Trust Estate pursuant to Section 5.4(c)(iii), the Bear
Indenture Trustee shall have provided the Class B note purchasers and the Class
B noteholders under the Bear Basic Documents with notice of such sale at least
two weeks in advance of such sale which notice shall specify the date, time and
location of such sale.
(e) In connection with a sale of all or any portion of the Collateral
pursuant to Section 5.4(a)(iv):
(i) any Note Purchaser or any Noteholder may bid for and
purchase the property offered for sale, and may hold, retain, possess
and dispose of such property, without further accountability, and (x)
any Noteholder of the Highest Priority Class may, in paying the
purchase money therefor, deliver in lieu of cash any Outstanding Note
of the Highest Priority Class or claims for interest thereon for credit
in the amount that shall, upon distribution of the net proceeds of such
sale, be payable thereon, and the Note of the Highest Priority Class so
delivered shall be cancelled and extinguished except that, in case the
amounts so payable thereon shall be less than the amount due thereon,
such Note shall be returned to the related Noteholder after being
appropriately stamped to show such partial payment and (y) the
Controlling Note Purchaser may, in paying the purchase money therefor,
set-off against any amount owed to it by the Issuer under the Basic
Documents;
(ii) the Trustee shall execute and deliver an appropriate
instrument of conveyance transferring its interest in any portion of
the Collateral in connection with a sale thereof; and
(iii) the Trustee is hereby irrevocably appointed the agent
and attorney-in-fact of the Issuer to transfer and convey its interest
in any portion of the Collateral in connection with a sale thereof, and
to take all action necessary to effect such sale.
(f) In connection with a sale of all or any portion of the Pledged
Subordinate Securities pursuant to Section 5.4(b)(iii):
-33-
(i) any Class B Note Purchaser or any Class B Noteholder may
bid for and purchase the property offered for sale, and may hold,
retain, possess and dispose of such property, without further
accountability, and (x) any Class B Noteholder may, in paying the
purchase money therefor, deliver in lieu of cash any Outstanding Class
B Note or claims for interest thereon for credit in the amount that
shall, upon distribution of the net proceeds of such sale, be payable
thereon, and the Class B Note so delivered shall be cancelled and
extinguished except that, in case the amounts so payable thereon shall
be less than the amount due thereon, such Class B Note shall be
returned to the related Class B Noteholder after being appropriately
stamped to show such partial payment and (y) any Class B Note Purchaser
may, in paying the purchase money therefor, set-off against any amount
owed to it under the Basic Documents;
(ii) the Trustee shall execute and deliver an appropriate
instrument of conveyance transferring its interest in any portion of
the Pledged Subordinate Securities in connection with a sale thereof;
and
(iii) the Trustee is hereby irrevocably appointed the agent
and attorney-in-fact of the Issuer to transfer and convey its interest
in any portion of the Pledged Subordinate Securities in connection with
a sale thereof, and to take all action necessary to effect such sale.
(g) In connection with a sale of all or any portion of the UBS Cross
Collateral pursuant to Section 5.4(c)(iii), subject to the prior Lien Granted
pursuant to Granting Clause I of this Indenture and to the terms and provisions
of the Intercreditor Agreement:
(i) any Class B note purchaser or any Class B noteholder under
the Bear Basic Documents may bid for and purchase the property offered
for sale, and may hold, retain, possess and dispose of such property,
without further accountability, and (x) any Class B noteholder under
the Bear Basic Documents may, in paying the purchase money therefor,
deliver in lieu of cash any outstanding Class B note issued under the
Bear Basic Documents or claims for interest thereon for credit in the
amount that shall, upon distribution of the net proceeds of such sale,
be payable thereon, and the Class B note so delivered shall be
cancelled and extinguished except that, in case the amounts so payable
thereon shall be less than the amount due thereon, such Class B note
shall be returned to the related Class B noteholder after being
appropriately stamped to show such partial payment and (y) any Class B
note purchaser under the Bear Basic Documents may, in paying the
purchase money therefor, set-off against any amount owed to it under
the Bear Basic Documents;
(ii) the Bear Indenture Trustee shall execute and deliver an
appropriate instrument of conveyance transferring its interest in any
portion of the UBS Cross Collateral in connection with a sale thereof;
and
(iii) the Bear Indenture Trustee is hereby irrevocably
appointed the agent and attorney-in-fact of the Issuer to transfer and
convey its interest in any portion of the UBS Cross Collateral in
connection with a sale thereof, and to take all action necessary to
effect such sale.
(h) The method, manner, time, place and terms of any sale of all or any
portion of the Trust Estate pursuant to Section 5.4(a)(iv), Section 5.4(b)(iii)
or Section 5.4(c)(iii) or otherwise shall be commercially reasonable.
SECTION 5.17 CONSEQUENCES OF A TFC FUNDING TERMINATION EVENT. Upon a
responsible officer of the Issuer having notice or actual knowledge thereof, the
Issuer agrees to give the Trustee, the Class A Noteholders and the Class A Note
Purchaser prompt written notice of any TFC Funding Termination Event. Upon the
occurrence and continuation of a TFC Funding Termination Event, the Class A Note
Purchaser and the Class A Majority Noteholders may terminate CPS and TFC as the
Servicer and subservicer, respectively, of the TFC Receivables, and direct the
Trustee to sell the TFC Receivables or any portion thereof or rights or interest
therein, at one or more public or private sales (including, without limitation,
-34-
the sale of the TFC Receivables in connection with a securitization thereof)
called and conducted in any manner permitted by applicable law. The proceeds of
any such sale shall be applied as Available Funds pursuant to Section 5.7(a) or
Section 5.7(c) of the Sale and Servicing Agreement, as applicable. Upon the
occurrence of a TFC Funding Termination Event, no future Advance may be made
with respect to a TFC Receivable.
ARTICLE VI
THE TRUSTEE
SECTION 6.1 DUTIES OF TRUSTEE. If an Event of Default has occurred and
is continuing, the Trustee shall exercise the rights and powers vested in it by
this Indenture and the other Basic Documents and use 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.
(a) Except during the continuance of an Event of Default:
(i) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and each of
the other Basic Documents to which it is a party (and, solely with
respect to any of its rights, obligations or remedies with respect to
any Bear Cross Collateral for the benefit of the Class B Noteholders
and the Class B Note Purchasers, such duties as are specified with
respect thereto in the Bear Basic Documents (including, without
limitation, the Bear Intercreditor Agreement)) and no implied covenants
or obligations shall be read into this Indenture against the Trustee;
and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture; however, the Trustee shall examine the certificates and
opinions to determine whether or not they conform on their face to the
requirements of this Indenture.
(b) The Trustee may 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; and
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts.
(c) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Issuer.
(d) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law or the terms of this Indenture
or the Sale and Servicing Agreement. (e) No provision of this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder or in the exercise
of any of its rights or powers, if it shall have reasonable grounds to believe
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(f) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
(g) The Trustee shall permit any representative of any Note Purchaser
or any Noteholder, during the Trustee's normal business hours, to examine all
books of account, records, reports and other papers of the Trustee relating to
the Notes and the transactions contemplated by the Basic Documents, to make
-35-
copies and extracts therefrom and to discuss the Trustee's affairs and actions,
as such affairs and actions relate to the Trustee's duties with respect to the
Notes and the Note Purchasers, with the Trustee's officers and employees
responsible for carrying out the Trustee's duties with respect to the Notes and
the Note Purchasers.
(h) The Trustee shall, and hereby agrees that it will, perform all of
the obligations and duties required of it under the other Basic Documents and,
solely with respect to any of its rights, obligations or remedies with respect
to any Bear Cross Collateral for the benefit of the Class B Noteholders and the
Class B Note Purchasers, such duties as are specified with respect thereto in
the Bear Basic Documents (including, without limitation, the Bear Intercreditor
Agreement).
(i) Except for actions expressly authorized by this Indenture, the
Trustee shall take no action reasonably likely to impair the security interests
created or existing under any Receivable or Financed Vehicle or to impair the
value of any Receivable or Financed Vehicle.
(j) All information obtained by the Trustee regarding the Obligors and
the Receivables, whether upon the exercise of its rights under this Indenture or
otherwise, shall be maintained by the Trustee in confidence and shall not be
disclosed to any other Person, other than the Trustee's attorneys, accountants
and agents unless such disclosure is required by this Indenture or any
applicable law or regulation.
SECTION 6.2 RIGHTS OF TRUSTEE. Subject to Sections 6.1 and this Section
6.2, the Trustee shall be protected and shall incur no liability to the Issuer,
any Note Purchaser or any Noteholder in relying upon the accuracy, acting in
reliance upon the contents, and assuming the genuineness of any notice, demand,
certificate, signature, instrument or other document reasonably believed by the
Trustee to be genuine and to have been duly executed by the appropriate
signatory, and, except to the extent the Trustee has actual knowledge to the
contrary or as required pursuant to Section 6.1 the Trustee shall not be
required to make any independent investigation with respect thereto.
(a) Before the Trustee acts or refrains from acting, it may require an
Officer's Certificate. Subject to Section 6.1(c), the Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on the
Officer's Certificate.
(b) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or a custodian or nominee, and the Trustee shall not be responsible
for any misconduct or negligence on the part of, or for the supervision of the
Servicer, the Backup Servicer or any other such agent, attorney, custodian or
nominee appointed with due care by it hereunder.
(c) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Trustee's conduct does not constitute
willful misconduct, negligence or bad faith.
(d) The Trustee may consult with counsel, and the advice or opinion of
counsel with respect to legal matters relating to this Indenture, the other
Basic Documents 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.
(e) The Trustee shall be under no obligation to institute, conduct or
defend any litigation under this Indenture or in relation to this Indenture, at
the request, order or direction of any Note Purchaser or any Noteholder,
pursuant to the provisions of this Indenture, unless such Note Purchaser and/or
such Noteholder, as applicable, shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that may be
incurred therein or thereby; provided, however, that the Trustee shall, upon the
occurrence of an Event of Default (that has not been cured), exercise the rights
and powers vested in it by this Indenture in accordance with Section 6.1.
-36-
(f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other paper
or document, unless requested in writing to do so by the Controlling Note
Purchaser and the Majority Noteholders of the Highest Priority Class; provided,
however, that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture or the
Sale and Servicing Agreement, the Trustee may require reasonable indemnity
against such cost, expense or liability as a condition to so proceeding; the
reasonable expense of every such examination shall be paid by the Person making
such request, or, if paid by the Trustee, shall be reimbursed by the Person
making such request upon demand.
SECTION 6.3 INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its individual
or any other capacity may become the owner or pledgee of a Note and may
otherwise deal with the Issuer or its Affiliates with the same rights it would
have if it were not the Trustee. Any Note Paying Agent, Note Registrar,
co-registrar or co-paying agent may do the same with like rights. However, the
Trustee must comply with Section 6.11.
SECTION 6.4 TRUSTEE'S DISCLAIMER. The Trustee shall not be responsible
for and makes no representation as to the validity or adequacy of this
Indenture, the Trust Estate, the Collateral, the Pledged Subordinate Securities,
the UBS Cross Collateral or the Notes, it shall not be accountable for the
Issuer's use of the proceeds from the Notes, and it shall not be responsible for
any statement of the Issuer in the Indenture or in any document issued in
connection with the sale of the Notes or in the Notes other than the Trustee's
certificate of authentication.
SECTION 6.5 NOTICE OF DEFAULTS. If an Event of Default occurs and is
continuing and if it is either known by, or written notice of the existence
thereof has been delivered to, a Responsible Officer of the Trustee, the Trustee
shall mail to each Note Purchaser and each Noteholder a notice of the Default
within three (3) Business Days after such knowledge or notice occurs. Except in
the case of a Default in payment of principal of or interest on any class of
Notes (including payments pursuant to the mandatory redemption provisions of
such class of Notes, if any) or a default in payment of any other amount due and
owing to any Noteholder or any Note Purchaser pursuant to the Basic Documents,
the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of the Noteholders.
SECTION 6.6 REPORTS BY TRUSTEE TO THE NOTEHOLDERS. The Trustee shall on
behalf of the Issuer deliver to the Noteholders and each Note Purchaser such
information as may be reasonably required to enable the Noteholders and the Note
Purchasers to prepare their respective Federal and State income tax returns.
SECTION 6.7 COMPENSATION AND INDEMNITY. Pursuant to Section 5.7(a) of
the Sale and Servicing Agreement, the Issuer shall pay to the Trustee from time
to time compensation for its services. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Issuer
shall reimburse the Trustee, pursuant and subject to Section 5.7(a) of the Sale
and Servicing Agreement, for all reasonable out-of-pocket expenses incurred or
made by it, including costs of collection, in addition to the compensation for
its services. Such expenses shall include the reasonable compensation and
expenses, disbursements and advances of the Trustee's agents, counsel,
accountants and experts. The Issuer shall or shall cause the Servicer to
indemnify the Trustee against any and all loss, liability or expense incurred by
the Trustee without willful misfeasance, negligence or bad faith on its part
arising out of or in connection with the acceptance or the administration of
-37-
this trust and the performance of its duties hereunder, including the costs and
expenses of defending itself against any claim or liability in connection
therewith. The Trustee shall notify the Issuer and the Servicer promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Issuer and the Servicer shall not relieve the Issuer of its obligations
hereunder or the Servicer of its obligations under Article XII of the Sale and
Servicing Agreement. The Trustee may have separate counsel and the Issuer shall
or shall cause the Servicer to pay the reasonable fees and expenses of such
counsel. Neither the Issuer nor the Servicer need reimburse any expense or
indemnify against any loss, liability or expense incurred by the Trustee through
the Trustee's own willful misconduct, negligence or bad faith.
(b) The Issuer's payment obligations to the Trustee pursuant to this
Section shall survive the discharge of this Indenture. When the Trustee incurs
expenses after the occurrence of a Default specified in Section 5.1(a)(v) with
respect to the Issuer, the expenses are intended to constitute expenses of
administration under Title 11 of the United States Code or any other applicable
Federal or State bankruptcy, insolvency or similar law. Notwithstanding anything
else set forth in this Indenture or the other Basic Documents, the recourse of
the Trustee hereunder and under the other Basic Documents specifically shall not
be recourse to the assets of any Noteholder or any Note Purchaser.
SECTION 6.8 Replacement of Trustee. The Issuer may, with the consent of
the Controlling Note Purchaser and the Majority Noteholders of the Highest
Priority Class, and at the request of the Controlling Note Purchaser and the
Majority Noteholders of the Highest Priority Class shall, remove the Trustee if:
(i) the Trustee fails to comply with Section 6.11 or the
Trustee fails to perform any other material covenant or agreement of
the Trustee set forth in the Basic Documents to which the Trustee is a
party and such failure continues for 45 days after written notice of
such failure from a Note Purchaser or a Noteholder;
(ii) an Insolvency Event with respect to the Trustee occurs;
or
(iii) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Issuer shall promptly appoint a successor
Trustee acceptable to the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class. If the Issuer fails to appoint such a
successor Trustee, the Controlling Note Purchaser and/or the Majority
Noteholders of the Highest Priority Class may appoint a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee, each Note Purchaser, each Noteholder and
the Issuer, whereupon, the resignation or removal of the retiring Trustee shall
become effective, and the successor Trustee shall have all the rights, powers
and duties of the retiring Trustee under this Indenture. The retiring Trustee
shall promptly transfer all property held by it as Trustee to the successor
Trustee.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer, the
Controlling Note Purchaser and the Majority Noteholders of the Highest Priority
Class may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor Trustee
pursuant to SECTION 6.8.
Notwithstanding the replacement of the Trustee pursuant to this
Section, the Issuer's and the Servicer's obligations under Section 6.7 shall
continue for the benefit of the retiring Trustee.
SECTION 6.9 SUCCESSOR TRUSTEE BY MERGER. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all its
-38-
corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee. The Trustee shall provide prior
written notice of any such transaction to each Noteholder and each Note
Purchaser.
(a) In case at the time such successor or successors to the Trustee by
merger, conversion or consolidation shall succeed to the trusts created by this
Indenture the Notes shall have been authenticated but not delivered, any such
successor to the Trustee may adopt the certificate of authentication of any
predecessor trustee, and deliver the Notes so authenticated; and in case at that
time the Notes shall not have been authenticated, any successor to the Trustee
may authenticate the Notes either in the name of any predecessor hereunder or in
the name of the successor to the Trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the Notes or in
this Indenture provided that the certificate of the Trustee shall have.
SECTION 6.10 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
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 Trustee with the consent of
the Controlling Note Purchaser and the Majority Noteholders of the Highest
Priority Class shall have the power and may execute and deliver all instruments
to appoint one or more Persons to act as a co-trustee or co-trustees, or
separate trustee or separate trustees, of all or any part of the Trust Estate,
and to vest in such Person or Persons, in such capacity and for the benefit of
the Noteholders and the Note Purchasers, such title to the Trust Estate, or any
part thereof, and, subject to the other provisions of this Section, such powers,
duties, obligations, rights and trusts as the Trustee may consider necessary or
desirable. 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 the Note Purchasers or the Noteholders of the appointment of any co-trustee
or separate trustee shall be required under Section 6.8 hereof.
(a) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed
the Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof in
any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the
Trustee;
(ii) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder, including acts
or omissions of predecessor or successor trustees; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
(b) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Indenture and the conditions
of this Article VI. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Indenture,
specifically including every provision of this Indenture relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
-39-
(c) Any separate trustee or co-trustee may at any time constitute the
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Indenture on its behalf and in its name. If any separate trustee or co-trustee
shall die, dissolve, become insolvent, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall vest
in and be exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 6.11 ELIGIBILITY: DISQUALIFICATION. The Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition and subject to supervision or
examination by federal or state authorities; and having a rating, both with
respect to long-term and short-term unsecured obligations, of not less than
investment grade by Standard & Poor's or Moody's. The Trustee shall provide
copies of such reports to each Note Purchaser and each Noteholder upon request.
SECTION 6.12 [RESERVED].
SECTION 6.13 APPOINTMENT AND POWERS. Subject to the terms and
conditions hereof, the Noteholders and the Note Purchasers hereby appoint Wells
Fargo Bank, National Association as Trustee, custodian and bailee with respect
to the Collateral, and Wells Fargo Bank, National Association hereby accepts
such appointment and agrees to act as Trustee with respect to the Collateral for
the benefit of the Noteholders and the Note Purchasers, to maintain custody and
possession of such Collateral (except as otherwise provided hereunder) and to
perform the other duties of the Trustee in accordance with the provisions of
this Indenture and the other Basic Documents. In addition, subject to the terms
and conditions hereof, the Class B Noteholders and the Class B Note Purchasers
hereby appoint Wells Fargo Bank, National Association as the Trustee with
respect to the Pledged Subordinate Securities, and Wells Fargo Bank, National
Association hereby accepts such appointment and agrees to act as Trustee with
respect to the Pledged Subordinate Securities for the benefit of the Class B
Noteholders and the Class B Note Purchasers, to maintain custody and possession
of such Pledged Subordinate Securities (except as otherwise provided hereunder)
and to perform the other duties of the Trustee in accordance with the provisions
of this Indenture and the other Basic Documents. In addition, subject to the
terms and conditions hereof, the Class B Noteholders and the Class B Note
Purchasers hereby appoint Wells Fargo Bank, National Association as the Trustee
with respect to the Bear Cross Collateral, and Wells Fargo Bank, National
Association hereby accepts such appointment and agrees to act as Trustee with
respect to the Bear Cross Collateral for the benefit of the Class B Noteholders
and the Class B Note Purchasers, to exercise all rights and remedies relating to
such Bear Cross Collateral on behalf of the Class B Noteholders and the Class B
Note Purchasers (as provided herein and in the Bear Basic Documents), in each
case subject to the terms and provisions of the Bear Intercreditor Agreement,
and to perform the other duties of the Trustee in accordance with the provisions
of this Indenture and the other Basic Documents. Each Note Purchaser and each
Noteholder, by its acceptance of a Note, hereby authorizes the Trustee to take
such action on its behalf, and to exercise such rights, remedies, powers and
privileges hereunder, as such Note Purchaser or such Noteholder may direct and
as are specifically authorized to be exercised by the Trustee by the terms
hereof, together with such actions, rights, remedies, powers and privileges as
are reasonably incidental thereto. The Trustee shall act upon and in compliance
with the written instructions of the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class delivered pursuant to this Indenture
promptly following receipt of such written instructions; provided that the
Trustee shall not act in accordance with any instructions (i) which are not
authorized by, or in violation of the provisions of, this Indenture or any
Intercreditor Agreement, (ii) which are in violation of any applicable law, rule
or regulation or (iii) for which the Trustee has not received reasonable
indemnity. Receipt of such instructions shall not be a condition to the exercise
by the Trustee of its express duties hereunder, except where this Indenture
provides that the Trustee is permitted to act only following and in accordance
with such instructions.
SECTION 6.14 PERFORMANCE OF DUTIES. The Trustee shall have no duties or
-40-
responsibilities except those expressly set forth in this Indenture and the
other Basic Documents to which the Trustee is a party or as directed by the
Majority Noteholders of the Highest Priority Class or the Controlling Note
Purchaser in accordance with this Indenture and the other Basic Documents. The
Trustee shall not be required to take any discretionary actions hereunder except
(i) at the written direction of the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class, or (ii) in the case of discretionary
actions solely with respect to the Pledged Subordinate Securities or the Bear
Cross Collateral, subject to the prior Lien Granted pursuant to Granting Clause
I of the Bear Indenture and the Bear Intercreditor Agreement, at the written
direction of the Class B Note Purchasers and the Class B Majority Noteholders.
The Trustee shall, and hereby agrees that it will, perform all of the duties and
obligations required of it under the Basic Documents.
SECTION 6.15 LIMITATION ON LIABILITY. Neither the Trustee nor any of
its directors, officers or employees shall be liable for any action taken or
omitted to be taken by it or them in good faith hereunder, or in connection
herewith, except that the Trustee shall be liable for its negligence, bad faith
or willful misconduct. Notwithstanding any term or provision of this Indenture,
the Trustee shall incur no liability to the Issuer, any Note Purchaser or any
Noteholder for any action taken or omitted by the Trustee in connection with the
Collateral, the Pledged Subordinate Securities or the UBS Cross Collateral,
except for the negligence, bad faith or willful misconduct on the part of the
Trustee, and, further, shall incur no liability to any Note Purchaser or any
Noteholder except for negligence, bad faith or willful misconduct in carrying
out its duties to such Note Purchaser or such Noteholder. The Trustee shall at
all times be free independently to establish to its reasonable satisfaction, but
shall have no duty to independently verify, the existence or nonexistence of
facts that are a condition to the exercise or enforcement of any right or remedy
hereunder or under any of the Basic Documents. The Trustee may consult with
counsel, and shall not be liable for any action taken or omitted to be taken by
it hereunder in good faith and in accordance with the written advice of such
counsel. The Trustee shall not be under any obligation to exercise any of the
remedial rights or powers vested in it by this Indenture or to follow any
direction from any Note Purchaser or any Noteholder unless it shall have
received reasonable security or indemnity satisfactory to the Trustee against
the costs, expenses and liabilities which might be incurred by it.
SECTION 6.16 [RESERVED].
SECTION 6.17 SUCCESSOR TRUSTEE.
(a) MERGER. Any Person into which the Trustee may be converted or
merged, or with which it may be consolidated, or to which it may sell or
transfer its trust business and assets as a whole or substantially as a whole,
or any Person resulting from any such conversion, merger, consolidation, sale or
transfer to which the Trustee is a party, shall (provided it is otherwise
qualified to serve as the Trustee hereunder) be and become a successor Trustee
hereunder and be vested with all of the title to and interest in the Collateral,
the Pledged Subordinate Securities and the UBS Cross Collateral and all of the
trusts, powers, descriptions, immunities, privileges and other matters and have
all of the obligations as its predecessor without the execution or filing of any
instrument or any further act, deed or conveyance on the part of any of the
parties hereto, anything herein to the contrary notwithstanding, except to the
extent, if any, that any such action is necessary to perfect, or continue the
perfection of, the security interest of the Trustee for the benefit of the (i)
the Note Purchasers and the Noteholders in the Collateral, (ii) the Class B Note
Purchasers and the Class B Noteholders in the Pledged Subordinate Securities,
and (iii) subject to the prior Lien Granted pursuant to Granting Clause I of
this Indenture and to the terms and provisions of the Intercreditor Agreement,
the Bear Indenture Trustee for the benefit of the Class B note purchasers and
the Class B noteholders under the Bear Basic Documents in the UBS Cross
Collateral; provided that any such successor shall also be the successor Trustee
under SECTION 6.9.
(b) REMOVAL. The Trustee may be removed by the Controlling Note
Purchaser and the Majority Noteholders of the Highest Priority Class at any
time, with or without cause, by an instrument or concurrent instruments in
-41-
writing delivered to the Trustee and the Issuer. A temporary successor may be
removed at any time to allow a successor Trustee to be appointed pursuant to
subsection (c) below. Any removal pursuant to the provisions of this subsection
(b) shall take effect only upon the date which is the latest of (i) the
effective date of the appointment of a successor Trustee and the acceptance in
writing by such successor Trustee of such appointment and of its obligation to
perform its duties hereunder in accordance with the provisions hereof, and (ii)
receipt by the Note Purchasers and the Noteholders of an Opinion of Counsel to
the effect described in Section 3.4.
(c) ACCEPTANCE BY SUCCESSOR. The Controlling Note Purchaser and the
Majority Noteholders of the Highest Priority Class shall have the sole right to
appoint each successor Trustee. Every temporary or permanent successor Trustee
appointed hereunder shall execute, acknowledge and deliver to its predecessor
and to the Trustee, the Note Purchasers, the Noteholders and the Issuer an
instrument in writing accepting such appointment hereunder and the relevant
predecessor shall execute, acknowledge and deliver such other documents and
instruments as will effectuate the delivery of all Collateral, Pledged
Subordinate Securities and UBS Cross Collateral to the successor Trustee,
whereupon such successor, without any further act, deed or conveyance, shall
become fully vested with all the estates, properties, rights, powers, duties and
obligations of its predecessor. Such predecessor shall, nevertheless, on the
written request of the Controlling Note Purchaser and the Majority Noteholders
of the Highest Priority Class or the Issuer, execute and deliver an instrument
transferring to such successor all the estates, properties, rights and powers of
such predecessor hereunder. In the event that any instrument in writing from the
Issuer or the Controlling Note Purchaser and the Majority Noteholders of the
Highest Priority Class is reasonably required by a successor Trustee to more
fully and certainly vest in such successor the estates, properties, rights,
powers, duties and obligations vested or intended to be vested hereunder in the
Trustee, any and all such written instruments shall at the request of the
temporary or permanent successor Trustee, be forthwith executed, acknowledged
and delivered by the Trustee or the Issuer, as the case may be. The designation
of any successor Trustee and the instrument or instruments removing any Trustee
and appointing a successor hereunder, together with all other instruments
provided for herein, shall be maintained with the records relating to the
Collateral, the Pledged Subordinate Securities and the UBS Cross Collateral and,
to the extent required by applicable law, filed or recorded by the successor
Trustee in each place where such filing or recording is necessary to effect the
transfer of the Collateral, the Pledged Subordinate Securities and the UBS Cross
Collateral to the successor Trustee or to protect or continue the perfection of
the security interests granted hereunder.
SECTION 6.18 [RESERVED].
SECTION 6.19 REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The Trustee
represents and warrants to the Issuer, each Note Purchaser and each Noteholder
as follows:
(a) The Trustee is a national banking association, duly organized,
validly existing and in good standing under the laws of the United States and is
duly authorized and licensed under applicable law to conduct its business as
presently conducted.
(b) The Trustee has all requisite right, power and authority to execute
and deliver this Indenture and to perform all of its duties as Trustee
hereunder.
(c) The execution and delivery by the Trustee of this Indenture and the
other Basic Documents to which it is a party, and the performance by the Trustee
of its duties hereunder and thereunder, have been duly authorized by all
necessary corporate proceedings and no further approvals or filings, including
any governmental approvals, are required for the valid execution and delivery by
the Trustee, or the performance by the Trustee, of this Indenture and such other
Basic Documents.
(d) The Trustee has duly executed and delivered this Indenture and each
other Basic Document to which it is a party, and each of this Indenture and each
such other Basic Document constitutes the legal, valid and binding obligation of
the Trustee, enforceable against the Trustee in accordance with its terms,
except as (i) such enforceability may be limited by bankruptcy, insolvency,
-42-
reorganization and similar laws relating to or affecting the enforcement of
creditors' rights generally and (ii) the availability of equitable remedies may
be limited by equitable principles of general applicability.
SECTION 6.20 WAIVER OF SETOFFS. The Trustee hereby expressly waives any
and all rights of setoff that the Trustee may otherwise at any time have under
applicable law with respect to any Pledged Account or Deposit Account and agrees
that amounts in the Pledged Accounts or Deposit Account shall at all times be
held and applied solely in accordance with the provisions hereof and the other
Basic Documents.
SECTION 6.21 CONTROL BY THE CONTROLLING NOTE PURCHASER AND THE MAJORITY
NOTEHOLDERS OF THE HIGHEST PRIORITY CLASS. The Trustee shall comply with notices
and instructions given by the Issuer only if accompanied by the written consent
of the Controlling Note Purchaser and the Majority Noteholders of the Highest
Priority Class, except that if any Event of Default shall have occurred and be
continuing, the Trustee shall act upon and comply with notices and instructions
given by the Controlling Note Purchaser and the Majority Noteholders of the
Highest Priority Class alone in the place and stead of the Issuer.
Notwithstanding the foregoing, the Trustee shall comply with notices and
instructions given by the Issuer solely with respect to the Pledged Subordinate
Securities or the Bear Cross Collateral, subject to the Bear Intercreditor
Agreement, only if accompanied by the written consent of the Class B Note
Purchasers and the Class B Majority Noteholders.
ARTICLE VII
[RESERVED]
ARTICLE VIII
COLLECTION OF MONEY AND RELEASES OF TRUST ESTATE
SECTION 8.1 COLLECTION OF MONEY. Except as otherwise expressly provided
herein, the Trustee may demand payment or delivery of, and shall receive and
collect, directly and without intervention or assistance of any fiscal agent or
other intermediary, all money and other property payable to or receivable by the
Trustee pursuant to this Indenture and the other Basic Documents. The Trustee
shall apply all such money received by it as provided in this Indenture, the
Sale and Servicing Agreement and the other Basic Documents. Except as otherwise
expressly provided in this Indenture or in the other Basic Documents, 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 Trustee may take such action
as may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.
SECTION 8.2 RELEASE OF TRUST ESTATE. Subject to the payment of its fees
and expenses pursuant to Section 6.7, the Trustee may, and when required by the
provisions of this Indenture shall, execute instruments to release property from
the lien of this Indenture, in a manner and under circumstances that are not
inconsistent with the provisions of this Indenture and the other Basic
Documents. No party relying upon an instrument executed by the Trustee as
provided in this Article VIII shall be bound to ascertain the Trustee's
authority, inquire into the satisfaction of any conditions precedent or see to
the application of any moneys.
-43-
(a) The Trustee shall, at such time as there are no Notes Outstanding,
all amounts due and owing to the Note Purchasers and the Noteholders under any
of the Basic Documents have been paid in full, all sums due the Trustee pursuant
to Section 6.7 have been paid and the respective terms of the Commitments shall
have expired, release any remaining portion of the Trust Estate that secured the
Notes and the other obligations of the Issuer, the Purchaser and the Seller to
the Note Purchasers and the Noteholders pursuant to the Basic Documents from the
lien of this Indenture and release to the Deposit Account any funds then on
deposit in the Pledged Accounts. The Trustee shall release property from the
lien of this Indenture pursuant to this Section 8.2(b) only upon receipt of an
Issuer Request accompanied by an Officer's Certificate, a copy of each of which
shall also be delivered to each Note Purchaser and each Noteholder.
OPINION OF COUNSEL. The Trustee and each Note Purchaser shall receive
at least seven days' notice when requested by the Issuer to take any action
pursuant to Section 8.2(a), accompanied by copies of any instruments involved,
and the Trustee shall also require as a condition to such action, an Opinion of
Counsel in form and substance satisfactory to the Trustee, stating the legal
effect of any such action, outlining the steps required to complete the same,
and concluding that all conditions precedent to the taking of such action have
been complied with and such action will not materially and adversely affect the
security for the Notes or the rights of any Note Purchaser and/or any Noteholder
in contravention of the provisions of this Indenture or any of the other Basic
Documents; provided, however, that such Opinion of Counsel shall not be required
to express an opinion as to the fair value of the Trust Estate. Counsel
rendering any such opinion may rely, without independent investigation, on the
accuracy and validity of any certificate or other instrument delivered to the
Trustee in connection with any such action.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 SUPPLEMENTAL INDENTURES WITH CONSENT OF THE CONTROLLING
NOTE PURCHASER AND THE MAJORITY NOTEHOLDERS OF THE HIGHEST PRIORITY CLASS.
(a) With the prior written consent of the Controlling Note Purchaser
and the Majority Noteholders of the Highest Priority Class, the Issuer and the
Trustee, when authorized by an Issuer Order, at any time and from time to time,
may enter into one or more indentures supplemental hereto, in form satisfactory
to the Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property at
any time subject to the lien of this Indenture (other than the Pledged
Subordinate Securities), or better to assure, convey and confirm unto
the Trustee any property subject or required to be subjected to the
lien of this Indenture (other than the Pledged Subordinate Securities),
or to subject to the lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein
and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit
of any class of Noteholders and any Note Purchaser, or to surrender any
right or power herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be
inconsistent with any other provision herein or in any supplemental
indenture or to make any other provisions with respect to matters or
questions arising under this Indenture or in any supplemental
indenture; provided that such action shall not adversely affect the
interests of any Note Purchaser or any Noteholder; or
-44-
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as
shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of
Article VI.
The Trustee is hereby authorized to join in the execution of any such
supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
(b) With the prior written consent of the Class B Note Purchasers and
the Class B Majority Noteholders, the Issuer and the Trustee, when authorized by
an Issuer Order, at any time and from time to time, may enter into one or more
indentures supplemental hereto, in form satisfactory to the Trustee, to correct
or amplify the description of the Pledged Subordinate Securities, or better to
assure, convey and confirm unto the Trustee the Pledged Subordinate Securities.
The Trustee is hereby authorized to join in the execution of any such
supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
(c) With the prior written consent of the Bear Indenture Trustee, the
Class B note purchasers and the Class B majority noteholders under the Bear
Basic Documents and subject to the prior Lien Granted pursuant to Granting
Clause I of this Indenture and to the terms and provisions of the Intercreditor
Agreement, the Issuer and the Trustee, when authorized by an Issuer Order, at
any time and from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, to correct or amplify
the description of the UBS Cross Collateral, or better to assure, convey and
confirm unto the Trustee the UBS Cross Collateral. The Trustee is hereby
authorized to join in the execution of any such supplemental indenture and to
make any further appropriate agreements and stipulations that may be therein
contained.
(d) The Issuer and the Trustee, when authorized by an Issuer Order,
may, also with the consent of the Controlling Note Purchaser and the Majority
Noteholders of the Highest Priority Class, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of any Note Purchaser or any Noteholder under
this Indenture; provided, however, that such action shall not, as evidenced by
an Opinion of Counsel, adversely affect in any material respect the interests of
such Note Purchaser or such Noteholder.
SECTION 9.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTE PURCHASERS AND
NOTEHOLDERS.
(a) The Issuer and the Trustee, when authorized by an Issuer Order,
also may, with the prior written consent of the Controlling Note Purchaser and
the Majority Noteholders of the Highest Priority Class, enter into an indenture
or indentures supplemental hereto for any purpose; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Note Purchaser or any Noteholder;
provided, further however, that, no such supplemental indenture shall, without
the prior written consent of the affected Note Purchaser and all of the
Noteholders of a class of Notes affected thereby:
(i) change the date of payment of any installment of principal
of or interest on a class of Notes or any other amount owed by the
Issuer under the Basic Documents, or reduce the Percentage Interest
thereof, the interest rate thereon, change the provisions of this
Indenture relating to the application of collections on, or the
proceeds of the sale of, the Collateral to payment of principal of or
interest on any class of Notes or any other amount owed by the Issuer
under the Basic Documents, or change any place of payment where, or the
coin or currency in which, any class of Notes or the interest thereon
or any other amount owed by the Issuer under the Basic Documents is
payable;
(ii) impair the right to institute suit for the enforcement of
the provisions of this Indenture requiring the application of funds
available therefor, as provided in ARTICLE V, to the payment of any
such amount due on any class of Notes or any other amount owed by the
Issuer under the Basic Documents on or after the respective due dates
thereof;
-45-
(iii) reduce the Percentage Interest, the consent of the
Holders of which is required for any such supplemental indenture, or
eliminate the requirement that the applicable Note Purchaser consent
thereto, or the consent of the Holders of which or the applicable Note
Purchaser is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences provided for in this Indenture;
(iv) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(v) reduce the Percentage Interest required to direct the
Trustee to direct the Issuer to sell or liquidate the Collateral or
eliminate the requirement that the Controlling Note Purchaser and the
Majority Noteholders of the Highest Priority Class so direct pursuant
to Section 5.4(a);
(vi) modify any provision of this Section except to increase
any percentage specified herein or to provide that certain additional
provisions of this Indenture or the other Basic Documents cannot be
modified or waived without the consent of the Controlling Note
Purchaser and the Majority Noteholders of the Highest Priority Class;
(vii) modify any of the provisions of this Indenture in such
manner as to affect the calculation of the amount or timing of any
payment of (x) interest or principal due on any class of Notes on any
Settlement Date (including the calculation of any of the individual
components of such calculation) or (y) any amount due to any Note
Purchaser or any Noteholder under the Basic Documents, or affect the
rights of any Note Purchaser or any Noteholder under the Basic
Documents or to affect the rights of any Noteholder to the benefit of
any provisions for the mandatory redemption of any class of Notes
contained herein; or
(viii) 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 Collateral or, except as otherwise permitted or contemplated herein
or in any of the Basic Documents, terminate the Lien of this Indenture
on any property at any time subject hereto or deprive the Noteholders
or a Note Purchaser of the security provided by the Lien of this
Indenture.
(b) The Issuer and the Trustee, when authorized by an Issuer Order,
also may, with the prior written consent of the Class B Note Purchasers and the
Class B Majority Noteholders, enter into an indenture or indentures supplemental
hereto for any purpose that affects solely the rights of any Class B Note
Purchaser or any Class B Noteholder; provided, however, that such action shall
not, as evidenced by an Opinion of Counsel, adversely affect in any respect the
interests of any Class A Note Purchaser or any Class A Noteholder; provided,
further however, that, no such supplemental indenture shall, without the prior
written consent of all of the Class B Noteholders:
(i) change the provisions of this Indenture relating to the
application of collections on, or the proceeds of the sale of, the
Pledged Subordinate Securities or the Bear Cross Collateral to payment
of principal of or interest on the Class B Notes;
(ii) reduce the Percentage Interest required to direct the
Trustee to direct the Issuer to sell or liquidate the Pledged
Subordinate Securities or eliminate the requirement that the Class B
Note Purchasers and the Class B Majority Noteholders so direct pursuant
to Section 5.4(b); or
(iii) permit the creation of any Lien ranking prior to or on a
parity with the Lien created pursuant to Granting Clause II of this
Indenture or, except as otherwise permitted or contemplated herein or
in any of the Basic Documents, terminate the Lien created pursuant to
Granting Clause II of this Indenture at any time subject hereto or
deprive the Class B Noteholders or the Class B Note Purchasers of the
security provided by the Lien created pursuant to Granting Clause II of
this Indenture.
(c) The Issuer and the Trustee, when authorized by an Issuer Order,
also may, with the prior written consent of the Bear Indenture Trustee and the
Class B note purchasers and the Class B majority noteholders under the Bear
Basic Documents, enter into an indenture or indentures supplemental hereto for
any purpose that affects solely the rights of any Class B note purchaser or any
-46-
Class B noteholder under the Bear Basic Documents; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in any
respect the interests of any Class A Note Purchaser or any Class A Noteholder;
provided, further however, that, no such supplemental indenture shall, without
the prior written consent of all of the Class B noteholders and Class B note
purchasers under the Bear Basic Documents:
(i) change the provisions of this Indenture relating to the
application of collections on, or the proceeds of the sale of, the UBS
Cross Collateral to payment of principal of or interest on the Class B
Notes;
(ii) reduce the Percentage Interest required to direct the
Bear Indenture Trustee to direct the Issuer to sell or liquidate the
UBS Cross Collateral or eliminate the requirement that the Class B note
purchasers and the Class B majority noteholders under the Bear Basic
Documents so direct pursuant to Section 5.4(c); or
(iii) subject to the Intercreditor Agreements, permit the
creation of any Lien ranking prior to or on a parity with the Lien
created pursuant to Granting Clause III of this Indenture (other than
the Lien granted pursuant to Granting Clause I of this Indenture) or,
except as otherwise permitted or contemplated herein or in any of the
Basic Documents, terminate the Lien created pursuant to Granting Clause
III of this Indenture at any time subject hereto or deprive the Bear
Indenture Trustee or the Class B noteholders or the Class B note
purchasers under the Bear Basic Documents, as applicable, of the
security provided by the Lien created pursuant to Granting Clause III
of this Indenture, subject to the prior Lien Granted pursuant to
Granting Clause I of this Indenture and the terms and provisions of the
Intercreditor Agreement.
(d) Unless otherwise specified by the Controlling Note Purchaser, the
Trustee may determine whether or not a class of Notes would be affected by any
supplemental indenture and any such determination shall be conclusive upon the
Note Purchasers and the Noteholders, whether theretofore or thereafter
authenticated and delivered hereunder. The Trustee shall not be liable for any
such determination made in good faith.
(e) It shall not be necessary for any Act of the Noteholders of an
affected class under this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act shall approve the
substance thereof. It shall be necessary for any Act of any affected Note
Purchaser under this Section to approve the substance and particular form of any
proposed supplemental indenture.
(f) Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to this Section, the Trustee shall mail to each
Note Purchasers and each Noteholder a copy of such supplemental indenture. Any
failure of the Trustee to mail such copy shall not, however, in any way impair
or affect the validity of any such supplemental indenture.
SECTION 9.3 EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modifications thereby of the trusts created
by this Indenture, the Trustee shall be entitled to receive, and subject to
Sections 6.1 and 6.2, shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture that affects the Trustee's own
rights, duties, liabilities or immunities under this Indenture or otherwise.
SECTION 9.4 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and be deemed to be modified and amended in accordance therewith, and the
respective rights, limitations of rights, obligations, duties, liabilities and
immunities under this Indenture of the Trustee, the Issuer, the Note Purchasers
and the Noteholders shall thereafter be determined, exercised and enforced
-47-
hereunder subject in all respects to such modifications and amendments, and all
the terms and conditions of any such supplemental indenture shall be and be
deemed to be part of the terms and conditions of this Indenture for any and all
purposes.
ARTICLE II
REPAYMENT AND PREPAYMENT OF NOTES
SECTION 10.1 REPAYMENT OF THE NOTES; OPTIONAL PREPAYMENT OF THE NOTES.
If the Class A Facility Termination Date is determined in accordance with
subsection (I) of the definition thereof, the outstanding principal balance of
the Class A Notes and all accrued and unpaid interest thereon will be amortized
and shall be payable in full by the Class A Final Scheduled Settlement Date. If
the Class A Facility Termination Date is determined in accordance with
subsection (II) of the definition thereof, the Class A Facility Termination Date
will result in immediate acceleration of the Class A Notes pursuant to Section
5.2 hereof. If the Class A Facility Termination Date is determined in accordance
with subsection (III) of the definition thereof, the outstanding principal
balance of the Class A Notes and all accrued and unpaid interest thereon will be
amortized and shall be payable in full by the third Settlement Date following
the relevant anniversary of the Class A Closing Date. Subject to the prior
payment in full of the Class A Notes and any outstanding amounts due and owing
to the Class A Note Purchaser and the Class A Noteholders under the Basic
Documents, the outstanding principal amount of the Class B Notes and all accrued
and unpaid interest thereon shall be payable in full on the Class B Facility
Termination Date and otherwise as provided in Section 3.1, the form of Class B
Note attached as Exhibit A-2, the Sale and Servicing Agreement and the other
Basic Documents. The Issuer may, at its option, prepay the applicable Invested
Amount of any class of Notes, in whole or in part, at any time on any Business
Day (such day the "Prepayment Date") in accordance with this Section 10.1 and
Section 10.2; provided that no such prepayment may occur in connection with the
closing of a Securitization Transaction unless all proceeds from such
Securitization Transaction, net of any placement and/or underwriting fees, any
premiums due to the related financial guaranty insurers and any required account
deposits, are deposited into the Collection Account on the related
Securitization Closing Date and the Pledged Subordinate Securities, if any, are
delivered to the Trustee pursuant to Section 3.3(c) of the Sale and Servicing
Agreement on the related Securitization Closing Date; provided further, that no
such prepayment may occur (i) unless and until all amounts due and payable in
respect of clauses (i) through (v) of Section 5.7(a) of the Sale and Servicing
Agreement have been paid in full irrespective of whether Available Funds are
sufficient for this purpose or (ii) if, after giving effect to such prepayment
and the release of any related Collateral, a Class A Borrowing Base Deficiency
shall exist. Simultaneous with any such prepayment, the Issuer shall pay all
accrued and unpaid interest on the applicable Invested Amount to be prepaid and
all other amounts then due and owing to the Class A Note Purchaser and the Class
A Noteholders under the Basic Documents. Upon the deposit of any prepayment and
all such other amounts then due and owing to the Class A Note Purchaser and the
Class A Noteholders under the Basic Documents into the Collection Account, the
Trustee shall release the Collateral (including any UBS Cross Collateral and, in
the case of a prepayment of the Class B Notes, if no Class B Borrowing Base
Deficiency would exist after giving effect to such prepayment, the related
Pledged Subordinate Securities, if any) that is the subject of such prepayment
from the lien of this Indenture. In connection with such prepayment, the Trustee
shall be entitled to conclusively rely upon the direction of the Issuer to the
Trustee (a form of which is attached hereto as Exhibit E) to release such
Collateral and UBS Cross Collateral (or Pledged Subordinate Securities, in the
case of a prepayment of the Class B Notes) as may be identified by the Issuer in
writing and consented to in writing by the Controlling Note Purchaser (in the
case of any Collateral and UBS Cross Collateral to be released) or the Class B
Note Purchaser (in the case of any Pledged Subordinate Securities to be
released) as being the subject of such prepayment upon the conditions specified
in such writing, which consent shall not unreasonably be withheld. All
prepayments in part shall be in principal amounts of at least $100,000. The
Issuer shall cause any proceeds (including, without limitation, capitalized
interest amounts) that would otherwise be due and payable to the Issuer upon a
subsequent transfer of the related Receivables after a Securitization Closing
Date (any such proceeds, the "Pre-Funding Proceeds") to be deposited into the
Collection Account for distribution as Class B Available Funds pursuant to
Section 5.8(b) of the Sale and Servicing Agreement.
SECTION 10.2 NOTICE OF PREPAYMENT. Notice of the prepayment of any
class
-48-
of Notes shall be given, upon the direction of the Issuer, by the Trustee by
facsimile transmission, courier or first class mail, postage prepaid, mailed,
faxed or couriered not less than five (5) days prior to the related Prepayment
Date, to each Note Purchaser and each Noteholder. All notices of prepayment
shall state (i) the Prepayment Date, (ii) the applicable Invested Amount(s) to
be prepaid, (iii) the estimated accrued and unpaid interest on the applicable
Invested Amount(s) to be prepaid and (iv) any other amounts due and owing to any
Note Purchaser under the Basic Documents. Failure to give notice of prepayment,
or any defect therein, to a Noteholder or a Note Purchaser shall not impair or
affect the validity of such prepayment.
SECTION 10.3 GENERAL PROCEDURES.
(a) The applicable Invested Amount of a class of Notes and amounts due
to the related Note Purchasers under the Basic Documents shall not be considered
reduced by any allocation, setting aside or distribution of any portion of the
Available Funds unless such Available Funds shall have been actually paid to the
Noteholders of such class or to the related Note Purchasers, as applicable. The
applicable Invested Amount of a class of Notes and amounts due to the related
Note Purchasers by the Issuer under the Basic Documents shall not be considered
repaid by any distribution of any portion of the Available Funds if at any time
such distribution is rescinded or must otherwise be returned for any reason, in
which event, if such amount has been returned by the Noteholders of such class
or the related Note Purchasers, as applicable, such principal, interest and/or
other amount shall be reinstated in an amount equal to the amount returned by
the Noteholders of such class or the related Note Purchasers, as applicable. No
provision of this Indenture shall require the payment or permit the collection
of interest in excess of the maximum permitted by applicable law.
(b) The applicable Class B Invested Amount and amounts due to the Class
B Note Purchasers by the Issuer under the Basic Documents shall not be
considered reduced by any allocation, setting aside or distribution of any
portion of the Class B Available Funds unless such Class B Available Funds shall
have been actually paid to the Class B Noteholders or to the Class B Note
Purchasers, as applicable. The applicable Class B Invested Amount and amounts
due to the Class B Note Purchasers by the Issuer under the Basic Documents shall
not be considered repaid by any distribution of any portion of the Class B
Available Funds if at any time such distribution is rescinded or must otherwise
be returned for any reason, in which event, if such amount has been returned by
the Class B Noteholders or the Class B Note Purchasers, as applicable, such
principal, interest and/or other amount shall be reinstated in an amount equal
to the amount returned by the Class B Noteholders or the Class B Note
Purchasers, as applicable. No provision of this Indenture shall require the
payment or permit the collection of interest in excess of the maximum permitted
by applicable law.
ARTICLE III
MISCELLANEOUS
SECTION 11.1 COMPLIANCE CERTIFICATES AND OPINIONS, ETC. Except as set
forth herein, upon any application or request by the Issuer to the Trustee to
take any action under any provision of this Indenture (other than any request
hereunder by the Issuer for an Advance), the Issuer shall furnish to the
Trustee, with a copy of each to each Note Purchaser and each Noteholder, (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,
and (ii) an Opinion of Counsel stating that in the opinion of such counsel all
such conditions precedent, if any, have been complied with, except that, in the
case of any such application or request as to which the furnishing of such
documents is specifically required by any provision of this Indenture, no
additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
-49-
(i) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory such condition or covenant has been complied with.
(b) Other than with respect to Dollars, prior to the deposit of any
Collateral, any Pledged Subordinate Securities, any UBS Cross Collateral or any
other property or securities with the 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, in addition to any obligation imposed in Section 11.1(a) or
elsewhere in this Indenture, furnish to the Trustee, with a copy thereof to each
Note Purchaser and each Noteholder, an Officer's Certificate certifying or
stating the opinion of each person signing such certificate as to the fair value
(on the date of such deposit) to the Issuer of the Collateral, the Pledged
Subordinate Securities, the UBS Cross Collateral or the other property or
securities to be so deposited.
(c) Other than with respect to the release of any Purchased Receivables
or Liquidated Receivables or the release, if any, of any Receivables upon a
mandatory or partial prepayment of any class of Notes and other amounts due to
any Note Purchaser from the Issuer under the Basic Documents pursuant to Section
10.1, whenever any property or securities are to be released from the lien of
this Indenture, the Issuer shall also furnish, prior to or contemporaneous with
such release, to the Trustee, with a copy thereof to each Note Purchaser and
each Noteholder, an Officer's Certificate certifying or stating the opinion of
each person signing such certificate as to the fair value (such fair value to be
as of a date 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.
(d) Notwithstanding Section 2.10 or any provision of this Section, the
Issuer may (A) collect, liquidate, sell or otherwise dispose of Receivables as
and to the extent permitted or required by the Basic Documents and (B) make cash
payments out of the Pledged Accounts as and to the extent permitted or required
by the Basic Documents.
SECTION 11.2 FORM OF DOCUMENTS DELIVERED TO TRUSTEE. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it is not necessary that all such matters be certified by,
or covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.
(a) Any certificate or opinion of an Authorized Officer of the Issuer
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his or her certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Servicer, the Seller, the Purchaser or the Issuer, stating that the
information with respect to such factual matters is in the possession of the
Servicer, the Seller, the Purchaser or the Issuer, unless such counsel knows, or
in the exercise of reasonable care should know, that the certificate or opinion
or representations with respect to such matters are erroneous.
-50-
(b) 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.
(c) Whenever in this Indenture, in connection with any application or
certificate or report to the Trustee, it is provided that the Issuer shall
deliver any document as a condition of the granting of such application, or as
evidence of the Issuer's compliance with any term hereof, it is intended that
the truth and accuracy, at the time of the granting of such application or at
the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the 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 OR NOTE PURCHASERS. Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by any Noteholder or any Note
Purchaser may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholder or such Note Purchaser in
person or by agents duly appointed in writing; and except as herein otherwise
expressly provided such action shall become effective when such instrument or
instruments are delivered to the Trustee, and, where it is hereby expressly
required, to the Issuer. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the "Act" of
such Noteholder or such Note Purchaser signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and (subject to
Section 6.1) conclusive in favor of the Trustee and the Issuer, if made in the
manner provided in this Section.
(a) The fact and date of the execution by any person of any such
instrument or writing may be proved in any customary manner of the Trustee.
(b) The ownership of the Notes of each class shall be proved by the
Note Register.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other action by a Holder of a Note shall bind each Holder of such Note
issued upon the registration thereof or in exchange therefor or in lieu thereof,
in respect of anything done, omitted or suffered to be done by the Trustee or
the Issuer in reliance thereon, whether or not notation of such action is made
upon such Note.
(d) Any waiver, consent or approval given by the Controlling Note
Purchaser under this Indenture or any other Basic Document shall be binding upon
each Class A Noteholder, each Class B Note Purchaser, each Class B Noteholder
and their respective successors and permitted assigns. In addition, any waiver,
consent or approval given by the Majority Noteholders of a class of Notes under
this Indenture or any other Basic Document shall be binding upon each Holder of
the related class of Notes and their respective successors and permitted
assigns.
SECTION 11.4 NOTICES, ETC., TO TRUSTEE, ISSUER, THE NOTE PURCHASERS AND
NOTEHOLDERS. Any request, demand, authorization, direction, notice, consent,
waiver or Act of the any Noteholder or any Note Purchasers or other documents
provided or permitted by this Indenture to be made upon, given or furnished to
or filed with:
(i) the Trustee by any Note Purchaser, any Noteholder or by
the Issuer shall be sufficient for every purpose hereunder if
personally delivered, delivered by overnight courier or mailed
certified mail, return receipt requested and shall be deemed to have
been duly given upon receipt of the Trustee at its Corporate Trust
Office;
(ii) the Issuer by the Trustee or by any Note Purchaser or any
Noteholder shall be sufficient for every purpose hereunder if
personally delivered, delivered by overnight courier or mailed
-51-
certified mail, return receipt requested and shall deemed to have been
duly given upon receipt by the Issuer at the Corporate Trust Office of
the Owner Trustee, with a copy to Consumer Portfolio Services, Inc.
16355 Laguna Canyon Road, Irvine, California 92618 Attention: Mark
Creatura, Esq. Confirmation: (888) 785-6691, Telecopy No. (949)
753-6897 or at such other address previously furnished in writing to
the Trustee by the Issuer. The Issuer shall promptly transmit any
notice received by it from any Noteholders or any Note Purchaser to the
Trustee; or
(iii) any notice to a Note Purchaser shall be sufficient for
any purpose hereunder if in writing and delivered by overnight courier
or mailed certified mail, return receipt requested, or personally
delivered or telexed or telecopied to the recipient as follows (or such
other address previously furnished in writing to the Trustee):
If to the Class A Note Purchaser, to:
UBS Real Estate Securities Inc.
1285 Avenue of the Americas, 11th Floor
Attention: Prakash Wadhwani
New York, New York 10019
Telephone: 212-713-3983
Telecopy: 212-713-7999
If to the Class B Note Purchasers, to:
The Patriot Group, LLC
One Thorndal Circle, 3rd Floor
Darien, CT 06820
Attention: Bruce Katz
Telephone: (203) 656-4395
Telecopy: (203) 656-4483
and
Waterfall Eden Fund, LP
1185 Avenue of the Americas
18th Floor
New York, NY 10036
Attention: Jack Ross
Telephone: (212) 843-8905
Telecopy: (212) 843-8909
(iv) any notice to a Noteholder shall be sufficient for any
purpose hereunder if in writing and delivered by overnight courier or
mailed certified mail, return receipt requested, or personally
delivered or telexed or telecopied to the recipient's contact
information reflected in the Note Register.
(v) Any Note Purchaser may deliver to the Noteholders any
notices, reports, Servicer's Certificates or any other documentation
delivered to such Note Purchaser hereunder or under any Basic Document,
but is under no obligation to so deliver such documentation and shall
not be liable for the content thereof.
SECTION 11.5 WAIVER. Where this Indenture provides for notice in any
manner, such notice may be waived in writing by any Person entitled to receive
such notice with respect to itself only, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice by any
-52-
Note Purchaser or any Noteholder shall be filed with the Trustee but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such a waiver. In case, by reason of the suspension of regular
mail service as a result of a strike, work stoppage or similar activity, it
shall be impractical to mail notice of any event to any Note Purchaser or any
Noteholder when such notice is required to be given pursuant to any provision of
this Indenture, then any manner of giving such notice as shall be satisfactory
to the Trustee shall be deemed to be a sufficient giving of such notice.
SECTION 11.6 ALTERNATE PAYMENT AND NOTICE PROVISIONS. Notwithstanding
any provision of this Indenture or any class of Notes to the contrary, the
Issuer may enter into any agreement with the Holder of any class of Notes or any
Note Purchaser providing for a method of payment, or notice by the Trustee or
the Note Paying Agent to such Holder or such Note Purchaser, that is different
from the methods provided for in this Indenture for such payments or notices,
provided that such methods are reasonable and consented to by the Trustee (which
consent shall not be unreasonably withheld). The Issuer will furnish to the
Trustee a copy of each such agreement and the Trustee will cause payments to be
made and notices to be given in accordance with such agreements.
SECTION 11.7 EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 11.8 SUCCESSORS AND ASSIGNS. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 11.9 BENEFITS OF INDENTURE; THIRD-PARTY BENEFICIARIES.
(a) Nothing in this Indenture or in the Notes, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, each Note Purchaser (each of which shall be a third-party beneficiary
of this Indenture) and its successors and assigns, and the Noteholders, and any
other party secured hereunder, and any other Person with an ownership interest
in any part of the Trust Estate, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
(b) Each of the Bear Indenture Trustee, each Class B note purchaser and
each Class B noteholder under the Bear Basic Documents shall be deemed to be a
third-party beneficiary with respect to this Indenture to the same extent as if
it was a party hereto, subject to the terms and provisions of the Intercreditor
Agreements.
SECTION 11.10 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 11.11 LEGAL HOLIDAYS. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes, this Indenture or any other Basic Document) 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.
-53-
SECTION 11.12 Governing Law. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS
LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.13 COUNTERPARTS. This Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument. Any signature page to this Indenture containing a manual
signature may be delivered by facsimile transmission or other electronic
communication device capable of transmitting or creating a printable written
record, and when so delivered shall have the effect of delivery of an original
manually signed signature page.
SECTION 11.14 RECORDING OF INDENTURE. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
(which may be counsel to the Trustee or any other counsel reasonably acceptable
to the Trustee) to the effect that such recording is necessary either for the
protection of the Noteholders, the Note Purchasers or any other Person secured
hereunder or for the enforcement of any right or remedy granted to the Trustee
under this Indenture.
SECTION 11.15 ISSUER OBLIGATION. The obligations of the Issuer under
this Indenture and the other Basic Documents shall be full recourse obligations
of the Issuer. Notwithstanding the foregoing, no recourse may be taken, directly
or indirectly, with respect to the obligations of the Issuer or the Trustee on
the Notes, under this Indenture, any other Basic Document or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Trustee in its individual capacity (ii) any owner of a beneficial interest in
the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director,
employee or agent of the Issuer or the Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer or the Trustee or of any successor
or assign of the Trustee in its individual capacity, except as any such Person
may have expressly agreed (it being understood that the Trustee has no such
obligations in its individual capacity) and except that any such partner, owner
or beneficiary shall be fully liable, to the extent provided by applicable law,
for any unpaid consideration for stock, unpaid capital contribution or failure
to pay any installment or call owing to such entity. Nothing contained in this
Section shall limit or be deemed to limit any obligations of the Issuer, the
Purchaser, the Seller or the Servicer hereunder or under any other Basic
Document, as applicable, which obligations are full recourse obligations of the
Issuer, the Purchaser, the Seller and the Servicer.
SECTION 11.16 NO PETITION. The Trustee, by entering into this
Indenture, hereby covenants and agrees that it will not at any time institute
against the Issuer, or join in any institution against the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States Federal or state bankruptcy or
similar law in connection with any obligations relating to the Notes, this
Indenture or any of the Basic Documents.
SECTION 11.17 INSPECTION. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of any Note Purchaser, any Noteholder
or the Trustee, during the Issuer's normal business hours, to examine all the
books of account, records, reports, and other papers of the Issuer, to make
copies and extracts therefrom, to cause such books to be audited by independent
certified public accountants, and to discuss the Issuer's affairs, finances and
-54-
accounts with the Issuer's officers, employees, and independent certified public
accountants, all at such reasonable times and as often as may be reasonably
requested. Each of the Trustee, each Note Purchaser and each Noteholder shall
and shall cause their respective representatives to hold in confidence all such
information except to the extent disclosure may be required by law (and all
reasonable applications for confidential treatment are unavailing) and except to
the extent that the Trustee may reasonably determine that such disclosure is
consistent with its Obligations hereunder.
SECTION 11.18 MARKET VALUE. In connection with the Class A Note
Purchaser's provision of the Market Value to the Servicer pursuant to Section
3.05(a) of the Class A Note Purchase Agreement, and the Servicer's provision of
such Market Value to the Class B Note Purchasers pursuant to Section 3.05(a) of
the Class B Note Purchase Agreement, the Issuer expressly acknowledges and
agrees that the Class A Note Purchaser is agreeing to permit the Servicer to
furnish the Market Value to the Class B Note Purchaser solely as an
accommodation in connection with the transactions contemplated by this Indenture
and the other Basic Documents. The Class A Note Purchaser makes no
representation or warranty (whether express or implied, oral or written) as to
the accuracy or completeness, or fitness for a particular use, of the Market
Value, and assumes no responsibility whatsoever to the Servicer, the Seller, the
Purchaser, the Issuer, the Trustee, the Class A Noteholders, the Class B Note
Purchasers or the Class B Noteholders in connection with its calculation of
Market Value or any use of such Market Value by the Issuer, the Trustee, any
Class A Noteholder, any Class B Note Purchaser, any Class B Noteholder, any of
their respective affiliates or any other Person and, consequently, none of the
Issuer, the Trustee, the Class A Noteholders, the Class B Note Purchasers or the
Class B Noteholders is relying upon the Class A Note Purchaser for the Market
Value in such regard. In consideration of the Class A Note Purchaser's providing
the Market Value to the Servicer and permitting the provision of such Market
Value to the Class B Note Purchasers from time to time, for which the Class A
Note Purchaser is not receiving any compensation, each of the Issuer, the
Trustee, each Class B Note Purchaser and each Class B Noteholder hereby
unconditionally and irrevocably releases and discharges the Class A Note
Purchaser and its respective affiliates, directors, officers, agents, employees
and representatives from, and the Issuer hereby agrees to indemnify, hold
harmless and reimburse the Class A Note Purchaser and any such other Person or
Persons with respect to, any and all actions, liabilities, losses, damages or
claims of any kind or nature whatsoever (including, without limitation,
reasonable attorney's fees and expenses and expenses of litigation), as
incurred, that may be imposed on or incurred by or asserted against the Class A
Note Purchaser or any such other Person or Persons in any way relating to or
arising out of (i) the Class A Note Purchaser's calculation of Market Value,
(ii) the Class A Note Purchaser's provision of such Market Value to the
Servicer, (iii) the Servicer's provision of such Market Value to the Class B
Note Purchaser, (iv) the use of such Market Value by any of the Servicer, the
Seller, the Purchaser, the Issuer, the Trustee, any Class B Note Purchaser, any
Class B Noteholder, any of their respective affiliates or any other Person in
connection with the transactions contemplated by this Indenture and the other
Basic Documents or otherwise, or (v) with respect to a any Pledged Subordinate
Securities issued in connection with a Securitization Transaction, the lead
placement agent's calculation of the market value thereof for purposes of the
definition of Class B Borrowing Base. Indemnification under this Section 11.18
shall survive the termination of this Indenture and the other Basic Documents.
These indemnity obligations shall be in addition to any obligations that the
Issuer may otherwise have under applicable law, hereunder or under any other
Basic Document.
SECTION 11.19 INTERCREDITOR AGREEMENT TO CONTROL. The rights,
obligations and remedies of the parties to this Indenture, the Noteholders and
the Note Purchasers hereunder, under the Notes and under the other Basic
Documents are subject in all respects to the terms and provisions of the
Intercreditor Agreement; provided, however that to the extent such rights,
obligations and remedies relate to the Bear Cross Collateral, such rights,
obligations and remedies are subject in all respects to the terms and provisions
of the Bear Intercreditor Agreement. In the event of any conflict between the
terms of this Indenture, the Notes or any other Basic Document, on the one hand,
and the Intercreditor Agreement or the Bear Intercreditor Agreement, as
applicable, on the other hand, the Intercreditor Agreement or the Bear
Intercreditor Agreement, as applicable, shall control.
SECTION 11.20 CONTROLLING NOTE PURCHASER; MAJORITY NOTEHOLDERS OF
HIGHEST PRIORITY CLASS. Notwithstanding anything contained in this Indenture,
the Notes or any other Basic Document to the contrary, in taking or refraining
-55-
from taking any action with respect to this Indenture, the Notes or any other
Basic Document, (i) the Class A Note Purchaser, when acting as Controlling Note
Purchaser, will be acting solely for its own benefit, and (ii) any Class A
Noteholder, when acting as one of the Majority Noteholders of the Highest
Priority Class, shall be acting solely for its own benefit, and in each case not
as agent, fiduciary or in any other capacity on behalf of the Issuer, the
Purchaser, the Seller, the Servicer, any Class B Note Purchaser, any Class B
Noteholder or any other Person. The interests of the Class A Note Purchaser and
the Class A Noteholders may be adverse to the interests of the Issuer, the
Purchaser, the Seller, the Servicer, the Class B Note Purchasers and the Class B
Noteholders (or any of them), and the Class A Note Purchaser and the Class A
Noteholders are not obligated to consider the interests of the Issuer, the
Purchaser, the Seller, the Servicer, any Class B Note Purchaser, any Class B
Noteholder or any other Person in taking or refraining from taking any action
under this Indenture, the Class A Notes or any other Basic Document (including
without limitation making any determination of Market Value, making any
determination of market value of Pledged Subordinate Securities, determining
whether or not to extend the Servicer's term, declaring an Event of Default,
declaring a Class A Funding Termination Event, declaring a Servicer Termination
Event, agreeing to any amendments to or waivers under any Basic Document,
accelerating the Class A Notes or exercising any other rights or remedies under
any Basic Document). Accordingly, any action taken or omitted by the Class A
Note Purchaser or any Class A Noteholder under this Indenture, the Class A Notes
or any other Basic Document may not be in the interests of, and may be directly
adverse to the interests of, the Issuer, the Purchaser, the Seller, the
Servicer, the Class B Note Purchasers and the Class B Noteholders (or any of
them). In addition, except as otherwise expressly provided in this Indenture,
the Class A Notes or the other Basic Documents, the Class A Note Purchaser or
any Class A Noteholder may waive or modify the terms of this Indenture, the
Class A Notes or any other Basic Document from time to time without the consent
of any Class B Note Purchaser or any Class B Noteholder, and shall, if an Event
of Default, a Class A Funding Termination Event or a Servicer Termination Event
shall occur, have the sole and absolute discretion to exercise rights and
remedies under the Basic Documents with respect to the Collateral (but excluding
any Pledged Subordinate Securities and any Class B Available Funds), including
without limitation to terminate the Servicer and/or to cause an acceleration of
the Class A Notes and the liquidation of the Collateral, in each case without
regard to the interests of the Issuer, the Purchaser, the Seller, the Servicer,
any Class B Note Purchaser, any Class B Noteholder or any other Person. The
Issuer, the Purchaser, the Seller, the Servicer, the Class B Note Purchasers and
the Class B Noteholders hereby waive any and all conflicts of interest (if any)
that may arise in respect of the exercise of any such rights or remedies by the
Class A Note Purchaser or any Class A Noteholder.
SECTION 11.21 ENTIRE AGREEMENT. This Agreement, together with the other
Basic Documents, including the exhibits and schedules thereto, contains a final
and complete integration of all prior expressions by the parties hereto with
respect to the subject matter hereof and shall constitute the entire agreement
among the parties hereto with respect to the subject matter hereof, superseding
all previous oral statements and other writings with respect thereto.
SECTION11.22 NO NOVATION. It is expressly understood and agreed by the
parties hereto that the amendment and restatement of this Indenture is in no way
intended to and shall not be deemed to constitute a novation or repayment of the
outstanding Class A Advances and the other obligations and liabilities existing
under the Original Basic Documents and the security interest of the Trustee in
the Collateral for the benefit of the Noteholders and the Note Purchasers shall
remain in full force and effect after giving effect to the amendment and
restatement of this Indenture and such security interest is hereby reaffirmed by
the Issuer.
SECTION 11.23 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND INDEMNITIES
UNDER ORIGINAL INDENTURE. The representations, warranties and indemnity
obligations of the Issuer made in the Original Indenture and each other Original
Basic Document prior to the Class B Closing Date shall survive the Class B
Closing Date and the execution and delivery of this Agreement, and each such
representation and warranty so made is true and correct as of the date
originally made and as of the date hereof.
-56-
IN WITNESS WHEREOF, the Issuer and the Trustee have caused this
Indenture to be duly executed by their respective officers, hereunto duly
authorized, all as of the day and year first above written.
PAGE FUNDING LLC, as Issuer
By:____________________________________________
Name:__________________________________________
Title:_________________________________________
WELLS FARGO BANK, NATIONAL ASSOCIATION, as
Trustee
By:____________________________________________
Name:__________________________________________
Title:_________________________________________
-57-
EXHIBIT A-1
VARIABLE FUNDING NOTE, CLASS A
REGISTERED Maximum Invested Amount: $200,000,000
No. A-1 Percentage Interest:____ %
SEE REVERSE FOR CERTAIN CONDITIONS
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR "BLUE
SKY" LAWS AND MAY BE RESOLD, PLEDGED OR TRANSFERRED ONLY TO (1) THE ISSUER (UPON
REDEMPTION THEREOF OR OTHERWISE) OR AN AFFILIATE OF THE ISSUER (AS CERTIFIED BY
THE ISSUER) OR (2) A "QUALIFIED PURCHASER" (AS DEFINED IN SECTION 2(a)(51) OF
THE INVESTMENT COMPANY ACT) THAT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D PROMULGATED UNDER THE
SECURITIES ACT THAT EXECUTES A CERTIFICATE, SUBSTANTIALLY IN THE FORM SPECIFIED
IN THE INDENTURE, TO THE EFFECT THAT IT IS AN INSTITUTIONAL ACCREDITED INVESTOR
ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY
OR AGENT FOR OTHERS (WHICH OTHERS ARE ALSO QUALIFIED PURCHASERS THAT ARE
INSTITUTIONAL ACCREDITED INVESTORS) (3) SO LONG AS THIS NOTE IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A TO A PERSON THAT EXECUTES A CERTIFICATE,
SUBSTANTIALLY IN THE FORM SPECIFIED IN THE INDENTURE, TO THE EFFECT THAT SUCH
PERSON IS A "QUALIFIED PURCHASER" (AS DEFINED UNDER SECTION 2(a)(51) OF THE
INVESTMENT COMPANY ACT) THAT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A), ACTING FOR ITS OWN ACCOUNT, OR AS A FIDUCIARY OR AGENT FOR OTHERS
(WHICH OTHERS ARE ALSO QUALIFIED PURCHASERS THAT ARE QUALIFIED INSTITUTIONAL
BUYERS) TO WHOM NOTICE IS GIVEN THAT THE SALE, PLEDGE, OR TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, OR (4) TO A QUALIFIED PURCHASER (AS DEFINED UNDER
SECTION 2(a)(51) OF THE INVESTMENT COMPANY ACT) IN A TRANSACTION OTHERWISE
EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION, IN
EACH SUCH CASE, IN COMPLIANCE WITH THE INDENTURE AND ALL APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION: PROVIDED,
THAT, IN THE CASE OF CLAUSE (4), THE TRUSTEE OR THE ISSUER MAY REQUIRE AN
OPINION OF COUNSEL TO THE EFFECT THAT SUCH TRANSFER MAY BE EFFECTED WITHOUT
REGISTRATION UNDER THE SECURITIES ACT, WHICH OPINION OF COUNSEL, IF SO REQUIRED,
SHALL BE ADDRESSED TO THE ISSUER AND THE TRUSTEE AND SHALL BE SECURED AT THE
EXPENSE OF THE HOLDER. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF THE
EXEMPTION PROVIDED BY RULE 144A FOR RESALES OF THIS NOTE.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AND SUBJECT TO INCREASES
AND DECREASES AS SET FORTH HEREIN AND IN THE INDENTURE. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
THE NOTE REGISTRAR SHALL NOT REGISTER ANY TRANSFER OR EXCHANGE OF THIS NOTE TO
THE EXTENT THAT UPON SUCH TRANSFER OR EXCHANGE THERE WOULD BE MORE THAN FOUR (4)
CLASS A NOTEHOLDERS REFLECTED ON THE NOTE REGISTER.
A-1-1
THIS NOTE IS SUBJECT TO THE TERMS AND PROVISIONS OF AN INTERCREDITOR AGREEMENT
DATED AS OF FEBRUARY 14, 2007 BY AND AMONG THE CLASS A NOTE PURCHASER, THE CLASS
A NOTEHOLDER, THE CLASS B NOTE PURCHASERS, THE CLASS B NOTEHOLDERS, THE ISSUER,
THE PURCHASER, THE SELLER, THE SERVICER AND THE TRUSTEE, AS THE SAME MAY BE
AMENDED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME.
PAGE FUNDING LLC
VARIABLE FUNDING NOTE, CLASS A
PAGE FUNDING LLC, a Delaware limited liability company (herein referred to as
the "ISSUER"), for value received, hereby promises to pay to [________________]
(the "NOTEHOLDER"), or its registered assigns, such Noteholder's pro rata
portion (based on the Percentage Interest reflected on the face of this Note) of
the principal sum of TWO HUNDRED MILLION DOLLARS ($200,000,000.00) or, if less,
such Noteholder's pro rata portion (based on the Percentage Interest reflected
on the face of this Class A Note) of the aggregate unpaid principal amount
outstanding under all of the Class A Notes (whether or not shown on the schedule
attached hereto (or such electronic counterpart maintained by the Trustee)),
which amount shall be payable in the amounts and at the times set forth in
Section 2.8(b) of the Indenture. The Issuer will pay interest on the
Noteholder's pro rata portion of Class A Advances under all of the Class A Notes
at the Class A Note Interest Rate. Such interest on Class A Advances shall be
due and payable on each Settlement Date until the principal of this Class A Note
is paid or made available for payment, to the extent funds will be available
from the Collection Account processed from and including the preceding
Settlement Date to but excluding each such Settlement Date in respect of (a) an
amount equal to the pro rata portion of the Class A Noteholders' Monthly
Interest Distributable Amount for the related Interest Period, plus (b) an
amount equal to a pro rata portion of any accrued and unpaid Class A
Noteholders' Interest Carryover Shortfall with respect to prior Interest
Periods, with interest on the amount of such Class A Noteholders' Interest
Carryover Shortfall at the Class A Note Interest Rate from the first Business
Day of the related Interest Period. Prior to the Class A Scheduled Maturity Date
and unless an Event of Default or a Class A Funding Termination Event specified
in clauses (i) through (iii) of the definition thereof shall have occurred, the
Issuer shall only be required to make interest payments on the Class A Invested
Amount of the Class A Notes to the holder hereof; provided that the Issuer may,
at its option, prepay the Class A Invested Amount of the Class A Notes, in whole
or in part, at any time pursuant to Section 10.1 of the Indenture. Following the
occurrence of an Event of Default or a Class A Funding Termination Event
specified in clauses (i) through (iii) of the definition thereof, the
Controlling Note Purchaser and the Majority Noteholders of the Highest Priority
Class may declare the Class A Invested Amount of the Class A Notes to be
immediately due and payable at par, together with accrued interest thereon, in
accordance with Section 5.2 of the Indenture. Principal of and interest on this
Class A Note shall be paid in the manner specified on the reverse hereof.
The principal of and interest on this Class A Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. This Class A Note does not
represent an interest in, or an obligation of, the Servicer or any affiliate of
the Servicer other than the Issuer.
This Class A Note amends and restates the Second Amended and Restated Variable
Funding Note dated as of August 31, 2005 (the "ORIGINAL CLASS A NOTE"), and is
not a novation of the Original Class A Note. All terms of this Class A Note that
are governed by the Indenture are as set forth herein.
Reference is made to the further provisions of this Class A Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Class A Note. Although a summary of certain provisions of
the Indenture are set forth below and on the reverse hereof and made a part
hereof, this Class A Note does not purport to summarize the Indenture and
reference is made to the Indenture for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and obligations of the Servicer and the Trustee. A copy
of the Indenture may be requested from the Trustee by writing to the Trustee at:
Wells Fargo Bank, National Association, 6th & Marquette, MAC N9311-161,
Minneapolis, Minnesota 55479, Attention: Corporate Trust Services, -- Asset
Backed Administration. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to them in the Indenture.
Unless the certificate of authentication hereon has been executed by the Trustee
whose name 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.
A-1-2
[Signature page follows.]
A-1-3
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer.
Date: [_______], 2007 PAGE FUNDING LLC
By:____________________________________________
Name:__________________________________________
Title:_________________________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is the Note issued under the within-mentioned Indenture.
WELLS FARGO BANK, NATIONAL ASSOCIATION, not in
its individual capacity, but solely as Trustee
By:______________________________________________
Authorized Signature
A-1-4
REVERSE OF THE CLASS A NOTE
This Class A Note is the duly authorized Class A Note of the Issuer, designated
as its Variable Funding Note, Class A (herein called the "CLASS A NOTE"), issued
under (i) the Second Amended and Restated Indenture, dated as of February 14,
2007 (such Indenture, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof, is herein
called the "INDENTURE"), by and between the Issuer and Wells Fargo Bank,
National Association, a national banking association, as trustee (the "TRUSTEE",
which term includes any successor Trustee under the Indenture), to which
Indenture and all indentures supplemental thereto, together with the other Basic
Documents, reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Trustee, the Note Purchasers and the
Noteholders. This Class A Note is subject to all terms and conditions of the
Indenture and the other Basic Documents. All terms used in this Note that are
defined in the Indenture, as amended, supplemented or otherwise modified from
time to time in accordance with the terms thereof, shall have the meanings
assigned to them in or pursuant to the Indenture, as so amended, supplemented or
otherwise modified.
"SETTLEMENT DATE" means, with respect to each Accrual Period, the 15th day of
the following calendar month, or if such day is not a Business Day, the
immediately following Business Day, commencing on August 16, 2004.
As described above, the entire unpaid principal amount of this Class A Note
shall be due and payable on the Class A Facility Termination Date.
Notwithstanding the foregoing, if an Event of Default or a Class A Funding
Termination Event specified in clauses (i) through (iii) of the definition
thereof shall have occurred and be continuing then, in certain circumstances,
principal on this Class A Note may be paid earlier, as described in the
Indenture.
Payments of interest on this Class A Note due and payable on each Settlement
Date, together with the installment of principal then due, if any, and any
payments of principal made on any Business Day in respect of any prepayments, to
the extent not in full payment of this Class A Note, shall be paid to the Person
in whose name this Class A Note is registered on the Record Date, either (i) by
wire transfer in immediately available funds to such Person's account as it
appears on the Note Register on such Record Date if (A) such Class A Noteholder
has provided to the Note Registrar appropriate written instructions at least
five Business Days prior to such Settlement Date and such Holder's Class A Note
in the aggregate evidence a Percentage Interest of not less than 1% or (B) such
Class A Noteholder is the Seller, or an Affiliate thereof, or if not, (ii) by
check mailed to such Class A Noteholder at the address of such Class A
Noteholder appearing on the Note Register, except for the final installment of
principal payable with respect to such Class A Note on a Settlement Date or on
the Class A Facility Termination Date, which shall be payable as provided below.
Any reduction in the principal amount of this Class A Note (or any predecessor
Class A Note) effected by any payments made on any date shall be binding upon
all future Holders of this Class A Note and of any Class A Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not noted thereon. Final payment of principal (together with any accrued and
unpaid interest) on this Class A Note will be paid to the Holder of this Class A
Note only upon presentation and surrender of this Class A Note at the Corporate
Trust Office for cancellation by the Trustee.
The Issuer shall pay interest on overdue installments of interest at the Class A
Note Interest Rate (calculated for this purpose using the Class A Default
Applicable Margin) to the extent lawful.
As provided in the Indenture and subject to certain limitations set forth
therein, the transfer of this Class A Note may be registered on the Note
Register upon surrender of this Class A Note for registration of transfer at the
office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer substantially in
the form attached hereto duly executed by the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class A Notes of authorized
Percentage Interest and in the same aggregate Percentage Interest will be issued
to the designated transferee or transferees. No service charge will be charged
for any registration of transfer or exchange of this Class A 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, other than exchanges pursuant to Section 9.6 of the
Indenture not involving a transfer.
A-1-5
The obligations of the Issuer under the Indenture, this Class A Note and the
other Basic Documents shall be full recourse obligations of the Issuer.
Notwithstanding the foregoing, each Class A Noteholder, by its acceptance of a
Class A Note, covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer or the Trustee on the
Class A Notes, under the Indenture, any other Basic Document or any certificate
or other writing delivered in connection herewith or therewith, against (i) the
Trustee in its individual capacity (ii) any owner of a beneficial interest in
the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director,
employee or agent of the Issuer or the Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer or the Trustee or of any successor
or assign of the Trustee in its individual capacity, except in each case as any
such Person may have expressly agreed (it being understood that the Trustee has
no such obligations in its individual capacity) and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Nothing contained in this Section shall limit or be deemed to limit any
obligations of the Issuer, the Purchaser, the Seller or the Servicer hereunder
or under any other Basic Document, as applicable, which obligations are full
recourse obligations of the Issuer, the Purchaser, the Seller and the Servicer.
Each Class A Noteholder, by its acceptance of a Class A Note, covenants and
agrees that by accepting the benefits of the Indenture that such Class A
Noteholder will not institute against the Issuer, or join in any institution
against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings under any United States Federal or state bankruptcy
or similar law in connection with any obligations relating to the Note, the
Indenture or the Basic Documents.
Prior to the due presentment for registration of transfer of this Class A Note,
the Trustee and any agent of the Trustee may treat the Person in whose name the
Class A Note (as of the applicable Record Date) is registered as the owner
hereof for all purposes, whether or not the Class A Note be overdue, and none of
the Issuer, the Trustee or any agent of the Issuer or the Trustee shall be
affected by notice to the contrary.
It is the intent of the Issuer and the Class A Noteholders that, for Federal,
State and local income and franchise tax purposes, this Class A Note will
evidence indebtedness of the Issuer secured by the Collateral. Each Class A
Noteholder, by its acceptance of a Class A Note, agrees to treat the Class A
Note for Federal, State and local income and franchise tax purposes as
indebtedness of the Issuer.
The Indenture permits in certain circumstances, 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 Note Purchasers and the
Noteholders under the Indenture at any time by the Issuer with the consent of
the Controlling Note Purchaser and the Majority Noteholders of the Highest
Priority Class. The Indenture also contains provisions permitting the
Controlling Note Purchaser and/or the Majority Noteholders of the Highest
Priority Class to waive compliance by the Issuer with certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Controlling Note Purchaser and the Majority Noteholders of the Highest Priority
Class (or the Holders of any predecessor Note) shall be conclusive and binding
upon the Note Purchasers, the current Noteholders and all future Noteholders and
of a Class A 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 such Class A Note.
Any waiver, consent or approval given by the Controlling Note Purchaser under
the Indenture or any other Basic Document shall be binding upon each Class A
Noteholder, each Class B Note Purchaser, each Class B Noteholder and their
respective successors and permitted assigns. In addition, any waiver, consent or
approval given by the Majority Noteholders of a class of Notes under this
Indenture or any other Basic Document shall be binding upon each Holder of the
related class of Notes and their respective successors and permitted assigns.
In connection with the Class A Note Purchaser's provision of the Market Value to
the Servicer under the Class A Note Purchase Agreement and the Servicer's
provision of such Market Value to the Class B Note Purchaser pursuant to the
Class B Note Purchase Agreement, each Class A Noteholder, by its acceptance of a
Class A Note, expressly acknowledges and agrees that the Class A Note Purchaser
is agreeing to permit the Servicer to furnish the Market Value to the Class B
Note Purchaser solely as an accommodation in connection with the transactions
contemplated by this Note and the other Basic Documents. The Class A Note
A-1-6
Purchaser makes no representation or warranty (whether express or implied, oral
or written) as to the accuracy or completeness, or fitness for a particular use,
of the Market Value, and assumes no responsibility whatsoever to any Class A
Noteholder in connection with its calculation of Market Value or any use of such
Market Value by the Servicer, the Seller, the Issuer, the Purchaser, any Class A
Noteholder, any of their respective affiliates or any other Person and,
consequently, none of the Servicer, the Seller, the Purchaser, the Issuer or the
Class A Noteholders is relying upon the Class A Note Purchaser for the Market
Value in such regard.
The rights, obligations and remedies of the Class A Noteholders pursuant to the
Class A Notes and under the other Basic Documents are subject in all respects to
the terms and provisions of the Intercreditor Agreement. In the event of any
conflict between the terms of this Class A Note or any other Basic Document and
the Intercreditor Agreement, the Intercreditor Agreement shall control.
The term "ISSUER" as used in this Class A Note includes any successor to the
Issuer under the Indenture.
This Class A Note is issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations set forth therein.
This Class A Note and the Indenture shall be construed in accordance with the
law of the State of New York, without reference to its conflict of law
provisions (other than Section 5-1401 of the General Obligations Law), and the
obligations, rights and remedies of the parties hereunder and thereunder shall
be determined in accordance with such law.
No reference herein to the Indenture and no provision of this Class A Note or of
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 Class A
Note at the times, place, and rate, and in the coin or currency herein
prescribed, subject to any duty of the Issuer to deduct or withhold any amounts
as required by law, including any applicable U.S. withholding taxes.
A-1-7
INCREASES AND DECREASES
==================================================================================================================
Unpaid Note
Principal Interest Interest Period Notation Made
Date Amount Increase Decrease Total Rate (if applicable) By
==================================================================================================================
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
==================================================================================================================
A-1-8
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: _______________________ _________________________ *
Signature Guaranteed:
__________________
*/ NOTE: 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-1-9
EXHIBIT A-2
VARIABLE FUNDING NOTE, CLASS B
REGISTERED Maximum Invested Amount: $25,000,000(1)
No. A-1 Percentage Interest:___ %
SEE REVERSE FOR CERTAIN CONDITIONS
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR "BLUE
SKY" LAWS AND MAY BE RESOLD, PLEDGED OR TRANSFERRED ONLY TO (1) THE ISSUER (UPON
REDEMPTION THEREOF OR OTHERWISE) OR AN AFFILIATE OF THE ISSUER (AS CERTIFIED BY
THE ISSUER) OR (2) A "QUALIFIED PURCHASER" (AS DEFINED IN SECTION 2(a)(51) OF
THE INVESTMENT COMPANY ACT) THAT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D PROMULGATED UNDER THE
SECURITIES ACT THAT EXECUTES A CERTIFICATE, SUBSTANTIALLY IN THE FORM SPECIFIED
IN THE INDENTURE, TO THE EFFECT THAT IT IS AN INSTITUTIONAL ACCREDITED INVESTOR
ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY
OR AGENT FOR OTHERS (WHICH OTHERS ARE ALSO QUALIFIED PURCHASERS THAT ARE
INSTITUTIONAL ACCREDITED INVESTORS) (3) SO LONG AS THIS NOTE IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A TO A PERSON THAT EXECUTES A CERTIFICATE,
SUBSTANTIALLY IN THE FORM SPECIFIED IN THE INDENTURE, TO THE EFFECT THAT SUCH
PERSON IS A "QUALIFIED PURCHASER" (AS DEFINED UNDER SECTION 2(a)(51) OF THE
INVESTMENT COMPANY ACT) THAT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A), ACTING FOR ITS OWN ACCOUNT, OR AS A FIDUCIARY OR AGENT FOR OTHERS
(WHICH OTHERS ARE ALSO QUALIFIED PURCHASERS THAT ARE QUALIFIED INSTITUTIONAL
BUYERS) TO WHOM NOTICE IS GIVEN THAT THE SALE, PLEDGE, OR TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, OR (4) TO A QUALIFIED PURCHASER (AS DEFINED UNDER
SECTION 2(a)(51) OF THE INVESTMENT COMPANY ACT) IN A TRANSACTION OTHERWISE
EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION, IN
EACH SUCH CASE, IN COMPLIANCE WITH THE INDENTURE AND ALL APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION: PROVIDED,
THAT, IN THE CASE OF CLAUSE (4), THE TRUSTEE OR THE ISSUER MAY REQUIRE AN
OPINION OF COUNSEL TO THE EFFECT THAT SUCH TRANSFER MAY BE EFFECTED WITHOUT
REGISTRATION UNDER THE SECURITIES ACT, WHICH OPINION OF COUNSEL, IF SO REQUIRED,
SHALL BE ADDRESSED TO THE ISSUER AND THE TRUSTEE AND SHALL BE SECURED AT THE
EXPENSE OF THE HOLDER. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF THE
EXEMPTION PROVIDED BY RULE 144A FOR RESALES OF THIS NOTE.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AND SUBJECT TO INCREASES
AND DECREASES AS SET FORTH HEREIN AND IN THE INDENTURE. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
_____________________
(1) Less the outstanding amount of any Bear Secured Obligations.
A-2-1
THE NOTE REGISTRAR SHALL NOT REGISTER ANY TRANSFER OR EXCHANGE OF THIS NOTE TO
THE EXTENT THAT UPON SUCH TRANSFER OR EXCHANGE THERE WOULD BE MORE THAN NINETY
(90) CLASS B NOTEHOLDERS REFLECTED ON THE NOTE REGISTER.
THIS NOTE IS SUBORDINATE IN RIGHT OF PAYMENT TO THE ISSUER'S CLASS A NOTES
ISSUED PURSUANT TO THE INDENTURE REFERENCED HEREIN AND TO ALL OTHER AMOUNTS DUE
AND OWING TO THE CLASS A NOTEHOLDERS AND THE CLASS A NOTE PURCHASER IN
ACCORDANCE WITH THE TERMS OF THE BASIC DOCUMENTS AND IS SUBJECT TO THE TERMS AND
PROVISIONS OF AN INTERCREDITOR AGREEMENT DATED AS OF FEBRUARY 14, 2007 BY AND
AMONG THE CLASS A NOTE PURCHASER, THE CLASS A NOTEHOLDER, THE CLASS B NOTE
PURCHASERS, THE CLASS B NOTEHOLDERS, THE ISSUER, THE PURCHASER, THE SELLER, THE
SERVICER AND THE TRUSTEE, AS THE SAME MAY BE AMENDED, SUPPLEMENTED OR OTHERWISE
MODIFIED FROM TIME TO TIME.
PAGE FUNDING LLC
VARIABLE FUNDING NOTE, CLASS B
PAGE FUNDING LLC, a Delaware limited liability company (herein referred to as
the "ISSUER"), for value received, hereby promises to pay to [________________]
(the "NOTEHOLDER"), or its registered assigns, such Noteholder's pro rata
portion (based on the Percentage Interest reflected on the face of this Note) of
the principal sum of TWENTY FIVE MILLION DOLLARS ($25,000,000.00), less the
outstanding amount of any Bear Secured Obligations, or, if less, such
Noteholder's pro rata portion (based on the Percentage Interest reflected on the
face of this Class B Note) of the aggregate unpaid principal amount outstanding
under all of the Class B Notes (whether or not shown on the schedule attached
hereto (or such electronic counterpart maintained by the Trustee)), which amount
shall be payable in the amounts and at the times set forth in Section 2.8(b) of
the Indenture. Subject to the prior payment of all amounts then due and owing on
the Class A Notes and all other amounts due and owing to the Class A Note
Purchaser under the Basic Documents, the Issuer will pay interest on the
Noteholder's pro rata portion of Class B Advances under all of the Class B Notes
at the Class B Note Interest Rate. Such interest on Class B Advances shall be
due and payable on each Settlement Date until the principal of this Class B Note
is paid or made available for payment, to the extent funds will be available
from the Collection Account processed from and including the preceding
Settlement Date to but excluding each such Settlement Date in respect of (a) an
amount equal to a pro rata portion of the Class B Noteholders' Monthly Interest
Distributable Amount for the related Interest Period, plus (b) an amount equal
to a pro rata portion of any accrued and unpaid Class B Noteholders' Interest
Carryover Shortfall with respect to prior Interest Periods, with interest on the
amount of such Class B Noteholders' Interest Carryover Shortfall at the Class B
Note Interest Rate from the first Business Day of the related Interest Period.
Prior to the Class B Facility Termination Date and unless an Event of Default
shall have occurred, the Issuer shall only be required to make interest payments
on the Class B Invested Amount of the Class B Notes to the holder hereof;
provided that the Issuer may, at its option and subject to the prior payment of
all amounts then due and owing on the Class A Notes and all other amounts due
and owing to the Class A Note Purchaser under the Basic Documents, prepay the
Class B Invested Amount of the Class B Notes, in whole or in part, at any time
pursuant to Section 10.1 of the Indenture. Following the occurrence of an Event
of Default, the Controlling Note Purchaser and the Majority Noteholders of the
Highest Priority Class may declare the Class B Invested Amount of the Class B
Notes to be immediately due and payable at par, together with accrued interest
thereon, in accordance with Section 5.2 of the Indenture. Principal of and
interest on this Class B Note shall be paid in the manner specified on the
reverse hereof.
The principal of and interest on this Class B Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. This Class B Note does not
represent an interest in, or an obligation of, the Servicer or any affiliate of
the Servicer other than the Issuer.
Reference is made to the further provisions of this Class B Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Class B Note. Although a summary of certain provisions of
the Indenture are set forth below and on the reverse hereof and made a part
hereof, this Class B Note does not purport to summarize the Indenture and
reference is made to the Indenture for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and obligations of the Servicer and the Trustee. A copy
of the Indenture may be requested from the Trustee by writing to the Trustee at:
Wells Fargo Bank, National Association, 6th & Marquette, MAC N9311-161,
Minneapolis, Minnesota 55479, Attention: Corporate Trust Services, -- Asset
Backed Administration. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to them in the Indenture.
A-2-2
Unless the certificate of authentication hereon has been executed by the Trustee
whose name 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.
[Signature page follows.]
A-2-3
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer.
Date: [_______], 2007 PAGE FUNDING LLC
By:____________________________________________
Name:__________________________________________
Title:_________________________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is the Note issued under the within-mentioned Indenture.
WELLS FARGO BANK, NATIONAL ASSOCIATION, not in
its individual capacity, but solely as Trustee
By: ____________________________________________
Authorized Signature
A-2-4
REVERSE OF THE CLASS B NOTE
This Class B Note is the duly authorized Class B Note of the Issuer, designated
as its Variable Funding Note, Class B (herein called the "CLASS B NOTE"), issued
under (i) the Second Amended and Restated Indenture, dated as of February 14,
2007 (such Indenture, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof, is herein
called the "INDENTURE"), by and between the Issuer and Wells Fargo Bank,
National Association, a national banking association, as trustee (the "TRUSTEE",
which term includes any successor Trustee under the Indenture), to which
Indenture and all indentures supplemental thereto, together with the other Basic
Documents, reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Trustee, the Note Purchasers and the
Noteholders. This Class B Note is subject to all terms and conditions of the
Indenture and the other Basic Documents. All terms used in this Note that are
defined in the Indenture, as amended, supplemented or otherwise modified from
time to time in accordance with the terms thereof, shall have the meanings
assigned to them in or pursuant to the Indenture, as so amended, supplemented or
otherwise modified.
"SETTLEMENT DATE" means, with respect to each Accrual Period, the 15th day of
the following calendar month, or if such day is not a Business Day, the
immediately following Business Day, commencing on February 15, 2007.
As described above, the entire unpaid principal amount of this Class B Note
shall be due and payable on the Class B Facility Termination Date.
Notwithstanding the foregoing, if an Event of Default or shall have occurred and
be continuing then, in certain circumstances, principal on this Class B Note may
be paid earlier, as described in the Indenture.
Payments of interest on this Class B Note due and payable on each Settlement
Date, together with the installment of principal then due, if any, and any
payments of principal made on any Business Day in respect of any prepayments, to
the extent not in full payment of this Class B Note, shall be paid to the Person
in whose name this Class B Note is registered on the Record Date, either (i) by
wire transfer in immediately available funds to such Person's account as it
appears on the Note Register on such Record Date if (A) such Class B Noteholder
has provided to the Note Registrar appropriate written instructions at least
five Business Days prior to such Settlement Date and such Holder's Class B Note
in the aggregate evidence a Percentage Interest of not less than 1% or (B) such
Class B Noteholder is the Seller, or an Affiliate thereof, or if not, (ii) by
check mailed to such Class B Noteholder at the address of such Class B
Noteholder appearing on the Note Register, except for the final installment of
principal payable with respect to such Class B Note on a Settlement Date or on
the Class B Facility Termination Date, which shall be payable as provided below.
Any reduction in the principal amount of this Class B Note (or any predecessor
Class B Note) effected by any payments made on any date shall be binding upon
all future Holders of this Class B Note and of any Class B Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not noted thereon. Final payment of principal (together with any accrued and
unpaid interest) on this Class B Note will be paid to the Holder of this Class B
Note only upon presentation and surrender of this Class B Note at the Corporate
Trust Office for cancellation by the Trustee.
The Issuer shall pay interest on overdue installments of interest at the Class B
Note Interest Rate (calculated for this purpose using the Class B Default
Applicable Margin) to the extent lawful.
As provided in the Indenture and subject to certain limitations set forth
therein, the transfer of this Class B Note may be registered on the Note
Register upon surrender of this Class B Note for registration of transfer at the
office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer substantially in
the form attached hereto duly executed by the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class B Notes of authorized
Percentage Interest and in the same aggregate Percentage Interest will be issued
to the designated transferee or transferees. No service charge will be charged
for any registration of transfer or exchange of this Class B 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, other than exchanges pursuant to Section 9.6 of the
Indenture not involving a transfer.
A-2-5
No transfer or assignment of a Secured Obligation shall be made that would cause
there to be more than 90 owners and assignees of the Class B Notes at any time.
For purposes of determining the number of owners and assignees of the Class B
Notes, a Person (beneficial owner) owning an interest in a partnership
(including any entity treated as a partnership for federal income tax purposes),
grantor trust or S corporation (flow through entity), that owns, directly or
through other flow-through entities, an interest in the Class B Notes, is
treated as an owner or an assignee of the Class B Notes if (i) substantially all
of the value of the beneficial owner's interest in the flow through entity is
attributable to the flow-through entity's interest (direct or indirect) in the
Class B Notes, and (ii) the principal purpose of the use of the tiered
arrangement is to permit the satisfaction of the 90 owner and assignee of Class
B Notes limitation.
The obligations of the Issuer under the Indenture, this Class B Note and the
other Basic Documents shall be full recourse obligations of the Issuer.
Notwithstanding the foregoing, each Class B Noteholder, by its acceptance of a
Class B Note, covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer or the Trustee on the
Class B Notes, under the Indenture, any other Basic Document or any certificate
or other writing delivered in connection herewith or therewith, against (i) the
Trustee in its individual capacity (ii) any owner of a beneficial interest in
the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director,
employee or agent of the Issuer or the Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer or the Trustee or of any successor
or assign of the Trustee in its individual capacity, except in each case as any
such Person may have expressly agreed (it being understood that the Trustee has
no such obligations in its individual capacity) and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Nothing contained in this Section shall limit or be deemed to limit any
obligations of the Issuer, the Purchaser, the Seller or the Servicer hereunder
or under any other Basic Document, as applicable, which obligations are full
recourse obligations of the Issuer, the Purchaser, the Seller and the Servicer.
Each Class B Noteholder, by its acceptance of a Class B Note, covenants and
agrees that by accepting the benefits of the Indenture that such Class B
Noteholder will not institute against the Issuer, or join in any institution
against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings under any United States Federal or state bankruptcy
or similar law in connection with any obligations relating to the Note, the
Indenture or the Basic Documents.
Prior to the due presentment for registration of transfer of this Class B Note,
the Trustee and any agent of the Trustee may treat the Person in whose name the
Class B Note (as of the applicable Record Date) is registered as the owner
hereof for all purposes, whether or not the Class B Note be overdue, and none of
the Issuer, the Trustee or any agent of the Issuer or the Trustee shall be
affected by notice to the contrary.
It is the intent of the Issuer and the Class B Noteholders that, for Federal,
State and local income and franchise tax purposes, this Class B Note will
evidence indebtedness of the Issuer secured by the Collateral. Each Class B
Noteholder, by its acceptance of a Class B Note, agrees to treat the Class B
Note for Federal, State and local income and franchise tax purposes as
indebtedness of the Issuer.
The Indenture permits in certain circumstances, 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 Note Purchasers and the
Noteholders under the Indenture at any time by the Issuer with the consent of
the Controlling Note Purchaser and the Majority Noteholders of the Highest
Priority Class. The Indenture also contains provisions permitting the
Controlling Note Purchaser and/or the Majority Noteholders of the Highest
Priority Class to waive compliance by the Issuer with certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Controlling Note Purchaser and the Majority Noteholders of the Highest Priority
Class (or the Holders of any predecessor Note) shall be conclusive and binding
upon the Note Purchasers, the current Noteholders and all future Noteholders and
of a Class B 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 such Class B Note.
Any waiver, consent or approval given by the Controlling Note Purchaser under
the Indenture or any other Basic Document shall be binding upon each Class A
Noteholder, each Class B Note Purchaser, each Class B Noteholder and their
respective successors and permitted assigns. In addition, any waiver, consent or
approval given by the Majority Noteholders of a class of Notes under this
Indenture or any other Basic Document shall be binding upon each Holder of the
related class of Notes and their respective successors and permitted assigns.
A-2-6
In connection with the Class A Note Purchaser's provision of the Market Value to
the Servicer under the Class A Note Purchase Agreement and the Servicer's
provision of such Market Value to the Class B Note Purchaser pursuant to the
Class B Note Purchase Agreement, each Class B Noteholder, by its acceptance of a
Class B Note, expressly acknowledges and agrees that the Class A Note Purchaser
is agreeing to permit the Servicer to furnish the Market Value to the Class B
Note Purchaser solely as an accommodation in connection with the transactions
contemplated by this Note and the other Basic Documents. The Class A Note
Purchaser makes no representation or warranty (whether express or implied, oral
or written) as to the accuracy or completeness, or fitness for a particular use,
of the Market Value, and assumes no responsibility whatsoever to any Class B
Noteholder in connection with its calculation of Market Value or any use of such
Market Value by the Servicer, the Seller, the Issuer, the Purchaser, any Class B
Note Purchaser, any Class B Noteholder, any of their respective affiliates or
any other Person and, consequently, none of the Servicer, the Seller, the
Purchaser, the Issuer, the Class B Note Purchasers or the Class B Noteholders is
relying upon the Class A Note Purchaser for the Market Value in such regard. In
consideration of the Class A Note Purchaser's providing the Market Value to the
Servicer and permitting the provision of such Market Value to the Class B Note
Purchasers, for which the Class A Note Purchaser is not receiving any
compensation, each Class B Noteholder, by its acceptance of a Class B Note,
unconditionally and irrevocably releases and discharges the Class A Note
Purchaser and its respective affiliates, directors, officers, agents, employees
and representatives from, and agrees to indemnify, hold harmless and reimburse
the Class A Note Purchaser and any such other Person or Persons with respect to,
any and all actions, liabilities, losses, damages or claims of any kind or
nature whatsoever (including, without limitation, reasonable attorney's fees and
expenses), as incurred, that may be imposed on or incurred by or asserted
against the Class A Note Purchaser or any such other Person or Persons in any
way relating to or arising out of (i) the Class A Note Purchaser's calculation
of Market Value, (ii) the Class A Note Purchaser's provision of such Market
Value to the Servicer, (iii) the Servicer's provision of such Market Value to
the Class B Note Purchaser, or (iv) the use of such Market Value by any of the
Servicer, the Seller, the Purchaser, the Issuer, any Class B Note Purchaser, any
Class B Noteholder, any of their respective affiliates or any other Person in
connection with the transactions contemplated by this Note and the other Basic
documents or otherwise.
The rights, obligations and remedies of the Class B Noteholders pursuant to the
Class B Notes and under the other Basic Documents are subject in all respects to
the terms and provisions of the Intercreditor Agreement (and any such rights,
obligations and remedies relating to the Bear Cross Collateral are subject in
all respects to the Bear Intercreditor Agreement). In the event of any conflict
between the terms of this Class B Note or any other Basic Document and the
Intercreditor Agreement, the Intercreditor Agreement (or, in the case of any
such terms relating to the Bear Cross Collateral, the Bear Intercreditor
Agreement) shall control.
Notwithstanding anything contained in this Note or the other Basic Documents to
the contrary, in taking or refraining from taking any action with respect to the
Class A Notes or any other Basic Document, (i) the Class A Note Purchaser, when
acting as Controlling Note Purchaser, will be acting solely for its own benefit,
and (ii) any Class A Noteholder, when acting as one of the Majority Noteholders
of the Highest Priority Class, shall be acting solely for its own benefit, and
in each case not as agent, fiduciary or in any other capacity on behalf of the
Issuer, the Purchaser, the Seller, the Servicer, any Class B Note Purchaser, any
Class B Noteholder or any other Person. The interests of the Class A Note
Purchaser and the Class A Noteholders may be adverse to the interests of the
Issuer, the Purchaser, the Seller, the Servicer, the Class B Note Purchasers and
the Class B Noteholders (or any of them), and the Class A Note Purchaser and the
Class A Noteholders are not obligated to consider the interests of the Issuer,
the Purchaser, the Seller, the Servicer, any Class B Note Purchaser, any Class B
Noteholder or any other Person in taking or refraining from taking any action
under the Class A Notes or any other Basic Document (including without
limitation making any determination of Market Value, making any determination of
market value of Pledged Subordinate Securities, determining whether or not to
extend the Servicer's term, declaring an Event of Default, declaring a Class A
Funding Termination Event, declaring a Servicer Termination Event, agreeing to
any amendments to or waivers under any Basic Document, accelerating the Class A
Notes or exercising any other rights or remedies under any Basic Document or
applicable law). Accordingly, any action taken or omitted by the Class A Note
Purchaser or any Class A Noteholder under the Class A Notes or any other Basic
Document may not be in the interests of, and may be directly adverse to the
interests of, the Issuer, the Purchaser, the Seller, the Servicer, the Class B
Note Purchasers and the Class B Noteholders (or any of them). In addition,
except as otherwise expressly provided in the Basic Documents, the Class A Note
Purchaser or any Class A Noteholder may waive or modify the terms of any Basic
Document from time to time without the consent of any Class B Note Purchaser or
A-2-7
any Class B Noteholder, and shall, if an Event of Default, a Class A Funding
Termination Event or a Servicer Termination Event shall occur, have the sole and
absolute discretion to exercise rights and remedies under the Basic Documents
with respect to the Collateral (but excluding any Pledged Subordinate Securities
and any Class B Available Funds), including without limitation to terminate the
Servicer and/or to cause an acceleration of the Class A Notes and the
liquidation of the Collateral, in each case without regard to the interests of
the Issuer, the Purchaser, the Seller, the Servicer, any Class B Note Purchaser,
any Class B Noteholder or any other Person. The Issuer, the Purchaser, the
Seller, the Servicer, the Class B Note Purchasers and the Class B Noteholders
hereby waive any and all conflicts of interest (if any) that may arise in
respect of the exercise of any such rights or remedies by the Class A Note
Purchaser or any Class A Noteholder.
The term "ISSUER" as used in this Class B Note includes any successor to the
Issuer under the Indenture.
This Class B Note is issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations set forth therein.
This Class B Note and the Indenture shall be construed in accordance with the
law of the State of New York, without reference to its conflict of law
provisions (other than Section 5-1401 of the General Obligations Law), and the
obligations, rights and remedies of the parties hereunder and thereunder shall
be determined in accordance with such law.
No reference herein to the Indenture and no provision of this Class B Note or of
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 Class B
Note at the times, place, and rate, and in the coin or currency herein
prescribed, subject to any duty of the Issuer to deduct or withhold any amounts
as required by law, including any applicable U.S. withholding taxes.
A-2-8
INCREASES AND DECREASES
==================================================================================================================
Date Unpaid Increase Decrease Total Note Interest Period Notation Made
Principal Interest
Amount Rate (if applicable) By
==================================================================================================================
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
==================================================================================================================
A-2-9
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: ____________________________ __________________________*
Signature Guaranteed:
_____________________
*/ NOTE: 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-2-10