Exhibit 4.5
DEUTSCHE FLOORPLAN RECEIVABLES, L.P.
Seller
DEUTSCHE FINANCIAL SERVICES CORPORATION
Servicer
and
THE CHASE MANHATTAN BANK
Trustee
Distribution Financial Services Floorplan Master Trust
AMENDED AND RESTATED
POOLING AND SERVICING AGREEMENT
Dated as of April 1, 2000
TABLE OF CONTENTS
PAGE
ARTICLE I Definitions.............................................................. 1
SECTION 1.1. Definitions......................................................... 1
SECTION 1.2. Other Definitional Provisions....................................... 24
SECTION 1.3. Provisions Relating to Rating Agencies.............................. 25
ARTICLE II Conveyance of Receivables................................................ 25
SECTION 2.1. Conveyance of Receivables........................................... 25
SECTION 2.2. Acceptance by Trustee............................................... 27
SECTION 2.3. Representations and Warranties of the Seller Relating to
the Seller and the Agreement...................................... 27
SECTION 2.4. Representations and Warranties of the Seller Relating to
the Receivables................................................... 30
SECTION 2.5. Addition of Accounts................................................ 31
SECTION 2.6. Covenants of the Seller............................................. 34
SECTION 2.7. Removal of Eligible Accounts........................................ 36
SECTION 2.8. Removal of Ineligible Accounts...................................... 37
SECTION 2.9. Sale of Ineligible Receivables...................................... 39
SECTION 2.10. Removal of Receivables in Connection with Overconcentration
Amount............................................................ 39
ARTICLE III Administration and Servicing of Receivables.............................. 39
SECTION 3.1. Acceptance of Appointment and Other Matters Relating to
the Servicer...................................................... 39
SECTION 3.2. Servicing Compensation.............................................. 41
SECTION 3.3. Representations, Warranties and Covenants of the Servicer........... 41
SECTION 3.4. Reports and Records for the Trustee................................. 44
SECTION 3.5. Annual Servicer's Certificate and Assertion......................... 44
SECTION 3.6. Annual Independent Public Accountants' Attestation and
Agreed Upon Procedures Report..................................... 45
SECTION 3.7. Tax Treatment....................................................... 45
SECTION 3.8. Notices to DFS...................................................... 46
SECTION 3.9. Adjustments......................................................... 46
ARTICLE IV Rights of Holders and Allocation and Application of Collections.......... 46
SECTION 4.1. Rights of Holders................................................... 46
SECTION 4.2. Establishment of the Collection Account............................. 47
SECTION 4.3. Allocations and Applications of Collections and Other Funds......... 48
SECTION 4.4. Unallocated Principal Collections................................... 49
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TABLE OF CONTENTS
(continued)
PAGE
SECTION 4.5. Allocations to the Dealer Overconcentration
Series............................................................ 49
ARTICLE V Distributions and Reports to Certificateholders.......................... 50
ARTICLE VI The Certificates......................................................... 50
SECTION 6.1. The Certificates.................................................... 50
SECTION 6.2. Authentication of Certificates...................................... 50
SECTION 6.3. New Issuances....................................................... 51
SECTION 6.4. Registration of Transfer and Exchange of Certificates............... 53
SECTION 6.5. Mutilated, Destroyed, Lost or Stolen Certificates................... 55
SECTION 6.6. Persons Deemed Owners............................................... 55
SECTION 6.7. Access to List of Registered Certificateholders' Names and
Addresses......................................................... 55
SECTION 6.8. Book-Entry Certificates............................................. 56
SECTION 6.9. Notices to Depository............................................... 57
SECTION 6.10. Definitive Certificates............................................. 57
SECTION 6.11. Global Certificate; Exchange Date................................... 57
SECTION 6.12. Meetings of Certificateholders...................................... 58
ARTICLE VII Other Matters Relating to the Seller..................................... 60
SECTION 7.1. Liability of the Seller............................................. 60
SECTION 7.2. Limitation on Liability of the Seller............................... 60
SECTION 7.3. Seller Indemnification of the Trust and the Trustee................. 60
SECTION 7.4. Liabilities......................................................... 61
ARTICLE VIII Other Matters Relating to the Servicer................................... 61
SECTION 8.1. Liability of the Servicer........................................... 61
SECTION 8.2. Merger or Consolidation of, or Assumption of, the Obligations
of the Servicer................................................... 61
SECTION 8.3. Limitation on Liability of the Servicer and Others.................. 62
SECTION 8.4. Servicer Indemnification of the Trust and the Trustee............... 62
SECTION 8.5. The Servicer Not to Resign.......................................... 63
SECTION 8.6. Access to Certain Documentation and Information
Regarding the Receivables......................................... 63
SECTION 8.7. Delegation of Duties................................................ 63
SECTION 8.8. Examination of Records.............................................. 63
SECTION 8.9. Custodial Arrangements.............................................. 64
ARTICLE IX Early Amortization Events................................................ 64
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TABLE OF CONTENTS
(continued)
PAGE
SECTION 9.1. Early Amortization Events........................................... 64
SECTION 9.2. Additional Rights Upon the Occurrence of Certain Events............. 66
ARTICLE X Servicer Defaults........................................................ 67
SECTION 10.1. Servicer Defaults................................................... 67
SECTION 10.2. Trustee to Act; Appointment of Successor............................ 69
ARTICLE XI The Trustee.............................................................. 70
SECTION 11.1. Duties of Trustee................................................... 70
SECTION 11.2. Certain Matters Affecting the Trustee............................... 72
SECTION 11.3. Trustee Not Liable for Recitals in Certificates..................... 73
SECTION 11.4. Trustee May Own Certificates........................................ 74
SECTION 11.5. The Servicer to Pay Trustee's Fees and Expenses..................... 74
SECTION 11.6. Eligibility Requirements for Trustee................................ 74
SECTION 11.7. Resignation or Removal of Trustee................................... 75
SECTION 11.8. Successor Trustee................................................... 75
SECTION 11.9. Merger or Consolidation of Trustee.................................. 76
SECTION 11.10. Appointment of Co-Trustee or Separate Trustee....................... 76
SECTION 11.11. Tax Returns......................................................... 77
SECTION 11.12. Trustee May Enforce Claims Without Possession of Certificates....... 77
SECTION 11.13. Suits for Enforcement............................................... 78
SECTION 11.14. Representations and Warranties of Trustee........................... 78
SECTION 11.15. Maintenance of Office or Agency..................................... 78
ARTICLE XII Termination.............................................................. 78
SECTION 12.1. Termination of Trust................................................ 78
SECTION 12.2. Final Distribution.................................................. 79
SECTION 12.3. Seller's Termination Rights......................................... 80
ARTICLE XIII Miscellaneous Provisions................................................. 80
SECTION 13.1. Amendment........................................................... 80
SECTION 13.2. Protection of Right, Title and Interest to Trust.................... 82
SECTION 13.3. Limitation on Rights of Certificateholders.......................... 83
SECTION 13.4. No Petition......................................................... 84
SECTION 13.5. GOVERNING LAW....................................................... 84
SECTION 13.6. Notices............................................................. 84
SECTION 13.7. Severability of Provisions.......................................... 85
SECTION 13.8. Assignment.......................................................... 85
SECTION 13.9. Certificates Nonassessable and Fully Paid........................... 85
SECTION 13.10. Further Assurances.................................................. 85
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PAGE
SECTION 13.11. No Waiver, Cumulative Remedies...................................... 85
SECTION 13.12. Counterparts........................................................ 85
SECTION 13.13. Third-Party Beneficiaries........................................... 85
SECTION 13.14. Actions by Certificateholders....................................... 85
SECTION 13.15. Rule 144A Information............................................... 86
SECTION 13.16. Action by Trustee................................................... 86
SECTION 13.17. Merger and Integration.............................................. 86
SECTION 13.18. Headings............................................................ 86
SECTION 13.19. Continued Effectiveness of the Existing Pooling and
Servicing Agreement............................................... 86
SECTION 13.20. Submission to Jurisdiction.......................................... 86
SECTION 13.21. Actions by Seller on Behalf of Trust................................ 87
EXHIBITS
Exhibit A [Reserved]
Exhibit B Form of Assignment of Receivables in Additional Accounts
Exhibit C Form of Annual Servicer's Certificate
Exhibit D Form of Legends
Exhibit E [Reserved]
Exhibit F Forms of Certificates for European Transfer
Exhibit G Forms of Opinions of Counsel
Exhibit H Form of Reassignment of Receivables in Removed Accounts
SCHEDULES
Schedule 1 List of Accounts
Schedule 2 Designation of Collection Account
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AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT dated as of
April 1, 2000, among DEUTSCHE FLOORPLAN RECEIVABLES, L.P., a Delaware limited
partnership, as Seller, DEUTSCHE FINANCIAL SERVICES CORPORATION, a Nevada
corporation, as Servicer, and THE CHASE MANHATTAN BANK, a New York banking
corporation, as Trustee.
WHEREAS, each party hereto executed a Pooling and Servicing
Agreement dated as of December 1, 1993, an amended and restated Pooling and
Servicing Agreement dated as of April 1, 1994, an amendment, dated as of January
24, 1996 to the Pooling and Servicing Agreement and an amended and restated
Pooling and Servicing Agreement dated as of October 1, 1996 (as so amended and
restated, the "Existing Pooling and Servicing Agreement") and now wishes to
amend and restate the Existing Pooling and Servicing Agreement;
NOW THEREFORE, in consideration of the mutual agreements herein
contained, each party agrees to amend and restate the Existing Pooling and
Servicing Agreement, for the benefit of the other parties and for the benefit of
the Certificateholders and the other Beneficiaries to the extent provided
herein, as follows:
ARTICLE I
Definitions
SECTION 1.1. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings:
"Account" shall mean each Initial Account and, from and after the
related Addition Date, each Additional Account. The term "Account" shall not
apply to any Removed Accounts reassigned or assigned to the Seller or the
Servicer in accordance with the terms of this Agreement.
"Accounts Receivable" shall mean, with respect to any Dealer, all
amounts shown on such Dealer's records as amounts payable by a customer in
respect of goods or services sold by such Dealer to such customer.
"Accounts Receivable Business" shall mean the extensions of credit
made by DFS or an Approved Affiliate to Dealers in order to finance the Accounts
Receivable of such Dealers.
"Accounts Receivable Financing Agreement" shall mean an accounts
receivable financing agreement entered into by DFS or an Approved Affiliate with
a Dealer in connection with the Accounts Receivable Business with such Dealer.
"Act" shall mean the Securities Act of 1933, as amended.
"Addition Date" shall have the meaning specified in Section 2.5(c).
"Addition Notice" shall have the meaning specified in Section
2.5(c).
"Additional Accounts" shall mean each individual revolving credit
arrangement established by DFS or an Approved Affiliate with a Dealer in
connection with the Floorplan Business, the Accounts Receivable Business, or the
Asset Based Lending Business, which account is designated pursuant to Section
2.5(a) or (b) to be included as an Account and is identified in a computer file
or microfiche or written list delivered to the Trustee by the Seller pursuant to
Sections 2.1 and 2.5(d).
"Additional Cut-Off Date" shall mean, with respect to Additional
Accounts, the day specified in the Addition Notice delivered with respect to
such Additional Accounts pursuant to Section 2.5(c).
"Adjustment Payment" shall have the meaning specified in Section
3.9.
"Affiliate" shall mean, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agent" shall mean, with respect to any Series, the Person (if any)
so designated in the related Supplement.
"Agreement" shall mean this Pooling and Servicing Agreement, as the
same may from time to time be amended or supplemented, including, with respect
to any Series or Class, by the related Supplement.
"Allocable Miscellaneous Payments" shall mean, with respect to any
Series and for any Collection Period, the product of the amount of Miscellaneous
Payments for such Collection Period and a fraction, the numerator of which is
the Invested Amount for such Series immediately prior to the following
Distribution Date and the denominator of which is the Trust Invested Amount as
of such time.
"Applicants" shall have the meaning specified in Section 6.7.
"Appointment Date" shall have the meaning specified in Section 9.2.
"Approved Affiliate" shall mean any Affiliate of DFS if the Rating
Agency Condition has been satisfied with respect to designating such Affiliate
as an Approved Affiliate.
"A/R Receivable Overconcentration" on any Determination Date shall
mean the excess, if any, of (a) the aggregate of all amounts of Principal
Receivables in Accounts created pursuant to Accounts Receivable Financing
Agreements as of the last day of the Collection Period immediately preceding
such Determination Date over (b) 20% of the Pool Balance on the last day of such
immediately preceding Collection Period or, if the Rating Agency Condition is
satisfied, such larger percentage of such Pool Balance as is stated in the
applicable notice from each applicable Rating Agency in connection with the
satisfaction of such Rating Agency Condition.
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"A/R Receivables" shall mean Receivables arising from the Accounts
Receivable Business.
"Asset Based Lending Business" shall mean the extensions of credit
made by DFS or an Approved Affiliate to Dealers in order to provide loans based
on the value of certain assets of such Dealer and generally secured by a first
priority security interest in such assets.
"Asset Based Lending Financing Agreement" shall mean an asset based
lending financing agreement entered into by DFS or an Approved Affiliate and a
Dealer in connection with the Asset Based Lending Business with such Dealer.
"Asset Based Receivable Overconcentration" on any Determination Date
shall mean the excess of (a) the aggregate of all amounts of Principal
Receivables in Accounts created pursuant to Asset Based Lending Financing
Agreements on the last day of the Collection Period immediately preceding such
Determination Date over (b) 20% of the Pool Balance on the last day of such
immediately preceding Collection Period or, if the Rating Agency Condition is
satisfied, such larger percentage of such Pool Balance as is stated in the
applicable notice from each applicable Rating Agency in connection with the
satisfaction of such Rating Agency Condition.
"Asset Based Receivables" shall mean Receivables arising from the
Asset Based Lending Business.
"Assignment" shall have the meaning specified in Section 2.5(d).
"Authorized European Newspaper" shall mean a daily newspaper, in the
official language of the country of publication, customarily published at least
once a day for at least five days in each calendar week, and of general
circulation in Luxembourg (or, if not practical in Luxembourg, in Europe)
including, without limitation, the Luxemburger Wort.
"Authorized Newspaper" shall mean any newspaper or newspapers of
general circulation in New York City customarily published on each Business Day,
whether or not published on Saturdays, Sundays and holidays.
"Automatic Addition Condition" shall mean, with respect to the
addition of Accounts pursuant to Section 2.5(c), that, as of the related Notice
Date, (i) during the calendar quarter in which such addition occurs, the number
of new Accounts for Dealers that are financing products of the type already
being financed by DFS and purchasing such products from Existing Manufacturers
does not exceed 5% of the number of all Accounts at the end of the preceding
calendar quarter, (ii) during the twelve months ending at the beginning of such
calendar quarter, the number of such new Accounts does not exceed 20% of the
number of all Accounts at the beginning of such twelve month period, (iii) the
average for the three months preceding the month of such addition of the
aggregate balance of Receivables that have been SAU or NSF for more than 30 days
does not exceed 1.25% of the Pool Balance at the end of the month preceding the
month of such addition, and (iv) the annualized average for such three month
period of the net losses incurred in respect of the Receivables does not exceed
1.75% of the Pool Balance at the end of the month preceding the month of such
addition. An Account that is removed from the Trust pursuant to Section 2.7 for
the purpose of permitting DFS or the
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related Approved Affiliate to convey a Participation Interest in the receivables
arising in such Account and, after such Participation Interest is created, is
designated as an Additional Account pursuant to Section 2.5 and has an Addition
Date that is no more than 45 days after its Removal Date, shall not be a "new
Account" for purposes of this definition.
"Beneficiary" shall mean any of the Holders of the Investor
Certificates, any of the Holders of the Dealer Overconcentration Series and any
Enhancement Provider.
"Benefit Plan" shall have the meaning specified in Section 6.4(c).
"Book-Entry Certificates" shall mean beneficial interests in the
Investor Certificates, ownership and transfers of which shall be made through
book entries by a Depository as described in Section 6.8.
"Business Day" shall mean any day other than (a) a Saturday or a
Sunday or (b) another day on which banking institutions in the state in which
the Corporate Trust Office is located are authorized or obligated by law,
executive order or governmental decree to be closed.
"Cedel" shall mean Centrale de Livraison de Valeurs Mobilieres S.A.
"Certificate" shall mean any of the Investor Certificates or the
Seller's Certificates.
"Certificate Owner" shall mean, with respect to a Book-Entry
Certificate, the Person who is the beneficial owner of a Book-Entry Certificate.
"Certificate Rate" shall mean, with respect to any Series or Class,
the interest rate, if any, specified therefor in the related Supplement;
provided, however, that the Dealer Overconcentration Series shall not have a
Certificate Rate.
"Certificate Register" shall have the meaning specified in Section
6.4.
"Certificateholder" shall mean an Investor Certificateholder or a
Person in whose name any one of the Seller's Certificates is registered.
"Certificateholders' Interest" shall have the meaning specified in
Section 4.1.
"Class" shall mean, with respect to any Series, any one of the
classes of Investor Certificates of that Series.
"Closing Date" shall mean, with respect to any Series, the Closing
Date specified in the related Supplement.
"Collateral Security" shall mean, with respect to any Receivable,
(i) the security interest, if any, granted by or on behalf of the related Dealer
with respect thereto, including a first priority perfected security interest in
the related Products, Accounts Receivable or assets, (ii) all other security
interests or liens and property subject thereto from time to time purporting to
secure payment of such Receivable, whether pursuant to the agreement giving rise
to such
4
Receivable or otherwise, together with all financing statements signed by a
Dealer describing any collateral securing such Receivable, (iii) all guarantees,
insurance and other agreements (including Floorplan Agreements and subordination
agreements with other lenders) or arrangements of whatever character from time
to time supporting or securing payment of such Receivable whether pursuant to
the agreement giving rise to such Receivable or otherwise, and (iv) all Records
in respect of such Receivable.
"Collection Account" shall have the meaning specified in Section
4.2.
"Collection Period" shall mean, with respect to any Distribution
Date, the calendar month preceding the month in which such Distribution Date
occurs.
"Collections" shall mean, without duplication, all payments by or on
behalf of Dealers received by the Servicer in respect of the Receivables
(including proceeds from the realization upon any Collateral Security), in the
form of cash, checks, wire transfers or any other form of payment. Collections
of Non-Principal Receivables shall include all Recoveries.
"Common Depositary" shall mean the Person specified as such in the
applicable Supplement, in its capacity as common depositary for the respective
accounts of any Foreign Clearing Agencies.
"Concentration Limit Percentage" shall have the meaning contemplated
by the definition of Dealer Concentration Limit.
"Corporate Trust Office" shall mean the principal office of the
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of the execution of this Agreement is
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Capital Markets Fiduciary Services, Deutsche Floorplan Receivables.
"Cut-Off Date" shall mean October 31, 1993.
"Date of Processing" shall mean, with respect to any transaction,
the date on which such transaction is first recorded on the Servicer's computer
file of accounts (without regard to the effective date of such recordation).
"Dealer" shall mean a Person engaged generally in the business of
purchasing consumer or commercial products from a manufacturer or distributor
thereof and holding such Products for sale or lease in the ordinary course of
business or a Person engaged generally in the business of manufacturing or
distributing Products for sale to Dealers in the ordinary course of business.
"Dealer Overconcentration" shall be determined by the Servicer on
each Determination Date. A Dealer Overconcentration shall exist with respect to
a Dealer (an "Overconcentrated Dealer") if the aggregate amount of the Principal
Receivables owed by such Dealer exceeds the applicable Dealer Concentration
Limit. "Dealer Concentration Limit" is a dollar amount calculated as a
percentage of the Pool Balance as of the end of each Collection Period (the
"Concentration Limit Percentage"). If the Dealer is among the fifteen Dealers
owing the largest amount of Principal Receivables as of the end of a Collection
Period (the "Top 15
5
Dealers"), the Concentration Limit Percentage as of April 20, 2000 is 3%. If the
Dealer is not among the Top 15 Dealers, the Concentration Limit Percentage as of
April 20, 2000 is 2%. The Concentration Limit Percentage for Top 15 Dealers, as
well as the Concentration Limit Percentage for the other Dealers, may be
increased or decreased from time to time by the Seller upon notice to the
Trustee and the Servicer without the consent of any Investor Certificateholder
if the Rating Agency Condition has been satisfied in connection with that
increase or decrease. For purposes of the definitions of Dealer
Overconcentration, Overconcentrated Dealer and Top 15 Dealers, a Dealer and all
of its Affiliates that are Dealers shall be considered to be a single Dealer.
For so long as a Dealer Overconcentration exists, allocations of Principal
Collections, Non-Principal Collections, Defaulted Amounts and Miscellaneous
Payments related to an Overconcentrated Dealer shall be allocated in accordance
with Section 4.5.
"Dealer Overconcentration Series" shall mean an uncertificated
Series known as the "Distribution Financial Services Floorplan Master Trust
Dealer Overconcentration Series."
"Defaulted Amount" on any Determination Date shall mean an amount
(which shall not be less than zero) equal to (a) the sum for all the Accounts of
the amount of Principal Receivables which became Defaulted Receivables during
the immediately preceding Collection Period (or with respect to a particular
Dealer, the amount of Principal Receivables of such Dealer which became
Defaulted Receivables during such Collection Period) minus (b) the full amount
of any such Defaulted Receivables for such Collection Period which are subject
to reassignment or assignment to the Seller or the Servicer in accordance with
the terms of this Agreement (or, with respect to a particular Dealer, the full
amount of such Defaulted Receivables of such Dealer which are subject to
reassignment or assignment to the Seller or the Servicer in accordance with the
terms of this Agreement); provided, however, that, if an Insolvency Event occurs
with respect to the Seller, the amounts of such Defaulted Receivables which are
subject to reassignment to the Seller shall not be included in clause (b) and,
if an Insolvency Event occurs with respect to the Servicer, the amount of such
Defaulted Receivables which are subject to assignment to the Servicer shall not
be included in clause (b).
"Defaulted Receivables" on any Determination Date shall mean (a) all
Receivables (other than all of the Ineligible Receivables) in an Account which
are charged off as uncollectible in respect of the immediately preceding
Collection Period in accordance with the Servicer's customary and usual
servicing procedures for servicing Dealer receivables comparable to the
Receivables which have not been sold to third parties and (b) all Receivables
which were Eligible Receivables when transferred to the Trust on the initial
Closing Date or the related Addition Date or on their respective Transfer Date,
which arose in an Account that thereafter became an Ineligible Account and which
remained outstanding for any six consecutive Determination Dates (inclusive of
the Determination Date on which such determination is being made) after such
Account became an Ineligible Account.
"Definitive Certificates" shall have the meaning specified in
Section 6.8.
"Definitive Euro-Certificates" shall have the meaning specified in
Section 6.11.
"Delayed Funding Receivable" shall mean a Receivable in respect of
which the related Floorplan Agreement permits DFS or an Approved Affiliate to
delay payment of the
6
purchase price of the related Product to the Manufacturer for a specified period
after the invoice date for such Product; provided that such Receivable shall be
a Delayed Funding Receivable only until DFS or such Approved Affiliate funds the
payment of such purchase price. Notwithstanding anything herein to the contrary,
if the Rating Agency Condition is satisfied, then the Receivables referred to in
the preceding sentence shall not be Delayed Funding Receivables and the
provisions herein relating to Delayed Funding Receivables shall no longer be of
any force or effect.
"Deposit Date" shall mean each day on which the Servicer deposits
Collections in the Collection Account pursuant to Section 4.3 hereof.
"Depository" shall mean The Depository Trust Company, as initial
Depository, the nominee of which is CEDE & Co., or any other organization
registered as a "clearing agency" pursuant to Section 17A of the Securities
Exchange Act of 1934, as amended. The Depository shall at all times be a
"clearing corporation" as defined in Section 8-102(3) of the Uniform Commercial
Code of the State of New York.
"Depository Agreement" shall mean, with respect to any Series or
Class, an agreement among the Trust, the Trustee and the initial Depository. The
Seller is hereby authorized to enter into each Depository Agreement on behalf of
the Trust.
"Depository Participant" shall mean a broker, dealer, bank or other
financial institution or other Person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.
"Designated Account" shall have the meaning specified in Section
2.8(b).
"Designated Balance" shall have the meaning specified in Section
2.8(b).
"Determination Date" with respect to any Distribution Date shall
mean the day that is two Business Days prior to such Distribution Date.
"Deutsche FRI" shall mean Deutsche Floorplan Receivables, Inc., a
Nevada corporation, and its successors and assigns.
"Deutsche FRLP" shall mean Deutsche Floorplan Receivables, L.P., a
Delaware limited partnership, and its successors.
"Deutsche FRLP Certificate" shall mean the certificate executed by
the Seller and authenticated by the Trustee, substantially in the form of
Exhibit A to the Existing Pooling and Servicing Agreement.
"Deutsche North America" shall mean Deutsche Bank Americas Holding
Corp., a Delaware corporation, and its successors in interest.
"DFS" shall mean Deutsche Financial Services Corporation, a Nevada
corporation, and its successors and assigns.
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"Discount Factor" shall initially mean 0.50% and shall be adjusted
as provided in this definition. If on any Distribution Date the Net Receivables
Rate for such Distribution Date less (i) the weighted average of the Certificate
Rates (as determined in accordance with this definition) for all outstanding
Series (other than the Dealer Overconcentration Series) for such Distribution
Date less (ii) the annualized Net Loss Rate for the preceding twelve Collection
Periods is less than 1%, then the Discount Factor for such Distribution Date
shall be adjusted upwards, rounded up to the nearest 0.1% (but in no event to
exceed 1%), so that the Net Receivables Rate less the rate in clause (i) less
the rate in clause (ii) shall be equal to 1%; and the Discount Factor shall
remain at such adjusted percentage until it is further adjusted by the terms of
this sentence or either of the following two sentences. Notwithstanding the
foregoing, the Seller, at its discretion, may increase or decrease the Discount
Factor, but in no event shall the Discount Factor exceed 1% or be less than the
percentage required by the immediately preceding sentence or be greater than the
percentage required by the next sentence. Notwithstanding the foregoing, if the
application of the Discount Factor would cause the Pool Balance to be less than
the Required Participation Amount, then the Discount Factor shall be the
percentage (which shall in no event be less than 0%), rounded down to the
nearest 0.1%, which, when applied, shall cause the Pool Balance to at least
equal the Required Participation Amount. For purposes of this definition, (i) if
a Certificate Rate is calculated as the lesser of (x) a fixed rate or a formula
rate and (y) the Net Receivables Rate, then such Certificate Rate shall be the
rate in clause (x) and (ii) if an interest rate swap agreement provides the
interest distributable on a Series or Class of Investor Certificates, then the
Certificate Rate for such Series or Class of Investor Certificates shall be the
interest rate payable by the Trust to the related swap counterparty.
"Discount Portion" shall mean, with respect to a Receivable, the
portion thereof equal to the product of the Discount Factor and the outstanding
principal balance of such Receivable.
"Distribution Date" shall mean the fifteenth day of each month or,
if such day is not a Business Day, the next succeeding Business Day.
"Distribution Date Statement" shall mean, with respect to any
Series, a report prepared by the Servicer on each Determination Date for the
immediately preceding Collection Period in substantially the form set forth in
the related Supplement.
"Duff & ▇▇▇▇▇▇" shall mean Duff & ▇▇▇▇▇▇ Credit Rating Co. or its
successor.
"Early Amortization Event" shall have the meaning specified in
Section 9.1 and, with respect to any Series, shall also mean any Early
Amortization Event specified in the related Supplement.
"Early Amortization Period" shall mean, with respect to any Series,
the period beginning at the close of business on the Business Day immediately
preceding the day on which the Early Amortization Event is deemed to have
occurred and ending upon the earliest to occur of (a) the payment in full to the
Investor Certificateholders of such Series of the Invested Amount with respect
to such Series, (b) the Termination Date with respect to such Series and (c) if
such Early Amortization Period has resulted from the occurrence of an Early
Amortization Event described in Section 9.1(a), the end of the first Collection
Period during which an Early
8
Amortization Event would no longer be deemed to exist pursuant to Section
9.1(a), so long as no other Early Amortization Event with respect to such Series
shall have occurred and the scheduled termination of the Revolving Period with
respect to such Series shall not have occurred. The Dealer Overconcentration
Series shall not have an Early Amortization Period.
"Eligible Account" shall mean each individual revolving credit
arrangement payable in U.S. dollars and established by DFS or an Approved
Affiliate with a Dealer in the ordinary course of business pursuant to a
Financing Agreement, which arrangement, as of the date of determination with
respect thereto: (a) is in favor of a Dealer (i) which is doing business in the
United States of America (including its territories and possessions), (ii) which
has not been identified by the Servicer as being the subject of any voluntary or
involuntary bankruptcy proceeding or being in a voluntary or involuntary
liquidation, and (iii) in which the direct controlling shareholder of DFS (which
is currently Deutsche North America) or any Affiliate thereof does not have an
equity investment, (b) is in existence and maintained and serviced by DFS or an
Approved Affiliate and (c) is an Account in respect of which no amounts have
been charged off as uncollectible.
"Eligible Deposit Account" shall mean either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution or trust company
organized under the laws of the United States of America or any one of the
states thereof, or the District of Columbia (or any domestic branch of a foreign
bank), having corporate trust powers and acting as trustee for funds deposited
in such account, so long as any of the securities of such depository institution
or trust company shall have a credit rating from each Rating Agency in one of
its rating categories which signifies investment grade.
"Eligible Institution" shall mean (a) the corporate trust department
of the Trustee or (b) a depository institution or trust company organized under
the laws of the United States of America or any one of the states thereof, or
the District of Columbia (or any domestic branch of a foreign bank), which at
all times (i) has either (A) a long-term unsecured debt rating of A2 or better
by Moody's, AAA by Standard & Poor's and, if Fitch has rated such debt, AA- or
better by Fitch or such other rating that is acceptable to each Rating Agency,
as evidenced by a letter from such Rating Agency to the Trustee or (B) a
certificate of deposit rating of P-1 by Moody's, A-1+ by Standard & Poor's and,
if Fitch has rated such certificate of deposit, F-1+ by Fitch or such other
rating that is acceptable to each Rating Agency, as evidenced by a letter from
such Rating Agency to the Trustee and (ii) whose deposits are insured by the
FDIC. If so qualified, the Trustee may be considered an Eligible Institution for
the purposes of clause (b) of this definition.
"Eligible Investments" shall mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form having original or remaining maturities of 30 days or less, but in no event
occurring later than the Distribution Date next succeeding the Trustee's
acquisition thereof, which evidence:
(a) direct obligations of, and obligations fully guaranteed as to
timely payment by, the United States of America;
9
(b) demand deposits, time deposits or certificates of deposit of
any depository institution or trust company incorporated under the laws of
the United States of America or any state thereof (or any domestic branch
of a foreign bank) and subject to supervision and examination by Federal
or state banking or depository institution authorities; provided, however,
that at the time of the Trust's investment or contractual commitment to
invest therein, the commercial paper or other short-term unsecured debt
obligations (other than such obligations the rating of which is based on
the credit of a person or entity other than such depository institution or
trust company) thereof shall have a credit rating from each of the Rating
Agencies in the Highest Investment Category granted thereby;
(c) commercial paper having, at the time of the Trust's investment
or contractual commitment to invest therein, a rating from each of the
Rating Agencies in the Highest Investment Category granted thereby;
(d) investments in money market funds having a rating from each of
the Rating Agencies in the Highest Investment Category granted thereby or
otherwise approved in writing thereby;
(e) bankers' acceptances issued by any depository institution or
trust company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that is a
direct obligation of, or fully guaranteed by, the United States of America
or any agency or instrumentality thereof the obligations of which are
backed by the full faith and credit of the United States of America, in
either case entered into with a depository institution or trust company
(acting as principal) described in clause (b); and
(g) any other investment as to which (x) the Rating Agency
Condition has been satisfied and (y) the Seller certifies will not result
in the Seller or the Trust becoming an "investment company" under the
Investment Company Act.
"Eligible Receivable" shall mean each Receivable:
(a) which was originated or acquired by DFS or the related
Approved Affiliate in the ordinary course of business;
(b) which arose under an Eligible Account;
(c) which is owned by DFS or the related Approved Affiliate at the
time of sale or contribution by DFS or the related Approved Affiliate to
the Seller;
(d) which represents the obligation of a Dealer to repay an
advance made or to be made to or on behalf of such Dealer (i) to finance
the acquisition of Products or (ii) in connection with the Accounts
Receivable Business or the Asset Based Lending Business;
(e) which at the time of creation and, except at the Closing Date
for the initial Series in the case of Receivables in respect of which the
related financed Product has been sold, at the time of transfer to the
Trust is secured, to the extent required by the
10
related Financing Agreement, by, inter alia, a first priority perfected
security interest (whether by prior filing, purchase money security
interest statutory priority, or subordination agreement from prior filers
or otherwise) in the related Product, Accounts Receivable other assets
financed by the related advance (except that such security interest need
not be a first priority security interest (x) in the case of a Receivable
arising in an Account for which the payment terms are on a scheduled
payment plan basis and the maximum credit line is $250,000 or less and
which was included as an Account hereunder on or before the Closing Date
for Series 1994-1 or (y) in the case of any Receivable if the Rating
Agency Condition is satisfied with respect thereto); and the perfection of
such security interest is governed by the laws of one or more of the
states of the United States, the District of Columbia or, if the Rating
Agency Condition is satisfied, a territory or possession of the United
States;
(f) which was created in compliance in all respects with all
Requirements of Law applicable thereto and pursuant to a Financing
Agreement which complies in all respects with all Requirements of Law
applicable to any party thereto;
(g) with respect to which all consents, licenses, approvals or
authorizations of, or registrations or declarations with, any Governmental
Authority required to be obtained, effected or given by DFS, the related
Approved Affiliate or the Seller in connection with the creation of such
Receivable or the transfer thereof to the Trust or the execution, delivery
and performance by DFS or the related Approved Affiliate of the Financing
Agreement pursuant to which such Receivable was created, have been duly
obtained, effected or given and are in full force and effect;
(h) as to which at all times following the transfer of such
Receivable to the Trust, the Trust shall have (x) good and marketable
title thereto free and clear of all Liens arising prior to the transfer or
arising at any time other than Liens permitted by this Agreement, or (y) a
first priority perfected security interest therein and in the related
Collateral Security (and in the proceeds thereof);
(i) which shall at all times be the legal, valid, binding and
assignable payment obligation of the Dealer relating thereto, enforceable
against such Dealer in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws, now or hereafter in
effect, affecting the enforcement of creditors' rights in general and
except as such enforceability may be limited by general principles of
equity (whether considered in a suit at law or in equity);
(j) which at the time of transfer to the Trust is not subject to
any valid claim of a right of rescission, setoff, counterclaim or any
other defense (including defenses arising out of violations of usury laws)
of the Dealer;
(k) as to which, at the time of transfer of such Receivable to the
Trust, DFS, the related Approved Affiliate and the Seller have satisfied
all their respective obligations with respect to such Receivable required
to be satisfied at such time (whether pursuant to the related Financing
Agreement, the related Floorplan Agreement or otherwise);
11
(l) as to which, at the time of transfer of such Receivable to the
Trust, neither DFS, the related Approved Affiliate nor the Seller has
taken or failed to take any action which would impair the rights of the
Trust or the Certificateholders therein;
(m) which constitutes "chattel paper", an "account" or a "general
intangible", and is not represented by an "instrument," each as defined in
Article 9 of the UCC as then in effect in the State of Missouri; provided
that the Financing Agreement giving rise to such Receivable may be subject
by its terms, or by judicial interpretation, to the laws of other states;
(n) with respect to which the representations set forth in
Sections 2.4(a)(i) and (ii) were correct as of the Transfer Date with
respect thereto; and
(o) if such Receivable has the benefit of a Floorplan Agreement,
such Floorplan Agreement provides that the related Manufacturer is
obligated, subject to the specific terms of such Floorplan Agreement
(which may vary among Floorplan Agreements), to repurchase Products that
the Servicer repossesses upon a default by the related Dealer.
"Eligible Servicer" shall mean the Trustee or an entity which, at
the time of its appointment as Servicer, (a) is legally qualified and has the
capacity to service the Accounts, (b) has demonstrated the ability to
professionally and competently service a portfolio of similar accounts in
accordance with high standards of skill and care and (c) is qualified to use the
software that is then currently being used to service the Accounts or obtains
the right to use or has its own software which is adequate to perform its duties
under this Agreement.
"Enhancement" shall mean the rights and benefits provided to the
Investor Certificateholders of any Series or Class pursuant to any letter of
credit, surety bond, cash collateral account, spread account, guaranteed rate
agreement, maturity liquidity facility, tax protection agreement, interest rate
swap agreement or other similar arrangement. The subordination of any Series or
Class to any other Series or Class or of the Seller's Interest to any Series or
Class shall be deemed to be an Enhancement. Enhancement provided to a particular
Series or Class shall not be available to another Series or Class unless the
applicable Enhancement Agreement otherwise provides.
"Enhancement Agreement" shall mean any agreement, instrument or
document governing the terms of any Enhancement or pursuant to which any
Enhancement is issued or outstanding.
"Enhancement Provider" shall mean the Person providing any
Enhancement, other than any Certificateholders (including any holders of the
Seller's Certificates) the Certificates of which are subordinated to any Series
or Class.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Euroclear Operator" shall mean ▇▇▇▇▇▇ Guaranty Trust Company of New
York, Brussels office, as operator of the Euroclear System.
12
"Exchange Date" shall mean any date that is after the Series
Issuance Date, in the case of Definitive Euro-Certificates in registered form,
or upon presentation of certification of non-United States beneficial ownership
(as described in Section 6.11), in the case of Definitive Euro-Certificates in
bearer form.
"Existing Manufacturer" shall mean (i) each Manufacturer with which
DFS has entered into a business arrangement, either through a Floorplan
Agreement or any other arrangement, on or prior to the Closing Date for Series
1994-1, (ii) each Manufacturer with which DFS enters into such a business
arrangement after the Closing Date for Series 1994-1 so long as the aggregate
balances of the Receivables subject to such Floorplan Agreement do not exceed
lesser of (a) 1% of the Pool Balance at the beginning of the Collection Period
in which the addition of the related Additional Account occurs and (b) $25
million and (iii) each Manufacturer with which DFS enters into such a business
arrangement after the Closing Date for Series 1994-1 and as to which the Rating
Agency Condition is satisfied.
"Existing Pooling and Servicing Agreement" shall have the meaning
set forth in the recitals.
"FDIC" shall mean the Federal Deposit Insurance Corporation or any
successor entity thereto.
"Final Maturity Date" shall have the meaning specified in Section
12.1.
"Financing Agreement" shall mean any Wholesale Financing Agreement,
Accounts Receivable Financing Agreement or Asset Based Lending Financing
Agreement.
"Financing Guidelines" shall mean DFS's written policies and
procedures, as such policies and procedures may be amended from time to time,
(a) relating to the operation of the Floorplan Business, the Accounts Receivable
Business and the Asset Based Lending Business, including the written policies
and procedures for determining the interest rate, if any, charged to Dealers,
the other terms and conditions relating to DFS's wholesale financing accounts,
the creditworthiness of Dealers and the extension of credit to Dealers, and (b)
relating to the maintenance of accounts and collection of receivables.
"Fitch" shall mean Fitch IBCA, Inc. or its successor.
"Floorplan Agreement" shall mean an agreement, entered into by DFS
or the related Approved Affiliate and a Manufacturer pursuant to which such
Manufacturer agrees, among other matters, to repurchase from DFS or such
Approved Affiliate, as applicable, Products sold by such Manufacturer to any of
its Dealers and financed by DFS or such Approved Affiliate under a Wholesale
Financing Agreement if DFS or such Approved Affiliate acquires possession of
such Products because of a default by such Dealer under such Wholesale Financing
Agreement, voluntary surrender or other circumstances.
"Floorplan Business" shall mean the extensions of credit made by DFS
or the related Approved Affiliate to Dealers in order to finance Products
purchased by Dealers from Manufacturers.
13
"Floorplan Receivables" shall mean Receivables arising from the
Floorplan Business.
"Foreign Clearing Agency" shall mean Cedel and the Euroclear
Operator.
"Global Certificate" shall have the meaning specified in Section
6.11.
"Governmental Authority" shall mean the United States of America,
any state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Highest Investment Category" means, with respect to a Rating
Agency, the highest long-term or short-term rating given by that Rating Agency
with respect to long-term or short-term obligations or investments, as the case
may be.
"Holder" shall mean a Certificateholder.
"Ineligible Account" shall mean an Account that at the time of
determination is not an Eligible Account.
"Ineligible Amount" on any Determination Date shall mean the amount
of Ineligible Receivables included in the Trust on such Determination Date.
"Ineligible Receivable" shall mean, without duplication, (i) any
Receivable that arises in an Eligible Account, was not an Eligible Receivable at
the time of its transfer to the Trust and was transferred to the Trust in
accordance with Section 2.9, (ii) any Receivable that, at the time of its
transfer to the Trust, has been SAU or NSF for more than 30 days, and (iii) the
aggregate of Receivables that, at the time of transfer of each such Receivable
to the Trust, have been SAU or NSF for a period of one to 30 days but only to
the extent that such aggregate amount exceeds 0.75% of the Pool Balance at the
end of such Collection Period.
"Initial Account" shall mean each individual revolving credit
arrangement established by DFS or an Approved Affiliate with a Dealer which was
identified in the computer file or microfiche or written list delivered to the
Trustee on the Closing Date for the Series issued in 1993 by the Seller pursuant
to Section 2.1.
"Initial Invested Amount" shall mean, with respect to any Series and
for any date, an amount equal to the initial invested amount specified in the
related Supplement. The Initial Invested Amount for any Series may be increased
or decreased from time to time as specified in the related Supplement. However,
the Dealer Overconcentration Series shall not have an Initial Invested Amount.
"Insolvency Event" shall mean any event specified in Section 9.1(b)
or 9.1(c).
"Insolvency Proceeds" shall have the meaning specified in Section
9.2(b).
"Insurance Proceeds" with respect to an Account shall mean any
amounts received by the Servicer pursuant to any policy of insurance which are
required to be paid to
14
DFS pursuant to a Wholesale Financing Agreement, Accounts Receivable Financing
Agreement or Asset Based Lending Financing Agreement.
"Internal Revenue Code" shall mean the Internal Revenue Code of
1986, as amended.
"Invested Amount" shall mean, with respect to any Series and at the
time of determination thereof, an amount equal to the invested amount specified
in the related Supplement at such time. However, the Dealer Overconcentration
Series shall not have an Invested Amount.
"Investment Company Act" shall mean the Investment Company Act of
1940, as amended.
"Investor Certificateholder" shall mean the Person in whose name a
Registered Certificate is registered in the Certificate Register or the bearer
of any Global Certificate and, with respect to the Dealer Overconcentration
Series, shall mean the Person or Persons in whose name an interest in the Dealer
Overconcentration Series is registered in the Certificate Register.
"Investor Certificates" shall mean any one of the certificates
(including the Registered Certificates or any Global Certificate) executed by
the Seller and authenticated by or on behalf of the Trustee, substantially in
the form attached to the related Supplement other than the Seller's
Certificates. The Dealer Overconcentration Series shall not be evidenced by any
certificate.
"Investors' Servicing Fee" shall mean the portion of the Servicing
Fee allocable to the Investor Certificateholders pursuant to the terms of the
Supplements.
"Lien" shall mean any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or other), preference, participation interest, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever,
including any conditional sale or other title retention agreement, any financing
lease having substantially the same economic effect as any of the foregoing and
the filing of any financing statement under the UCC or comparable law of any
jurisdiction to evidence any of the foregoing; provided, however, that (i) any
assignment permitted by Section 8.2, (ii) any Lien created by this Agreement,
any Supplement or any Participation Agreement, (iii) any security interests in
Products or Accounts Receivable that are subordinate to the security interests
securing the related Receivables and (iv) any inchoate lien that arises by
operation of law, is not delinquent or due and affects collateral securing a
Receivable (but does not encumber any Receivable) shall not be deemed to
constitute a Lien.
"Manager" shall mean the lead manager, manager or co-manager or
person performing a similar function with respect to an offering of Definitive
Euro-Certificates.
"Manufacturer" shall mean a Person engaged generally in the business
of manufacturing or distributing Products for sale or lease to Dealers in the
ordinary course of business.
15
"Manufacturer Overconcentration" on any Determination Date shall
mean, with respect to all Accounts covered by a Floorplan Agreement with the
same Manufacturer as obligor, the excess of (a) the aggregate of all amounts of
Principal Receivables in such Accounts on the last day of the Collection Period
immediately preceding such Determination Date that are covered by such Floorplan
Agreement over (b) 15% of the Pool Balance on the last day of such immediately
preceding Collection Period or, if the Rating Agency Condition is satisfied,
such larger percentage of such Pool Balance as is stated in the notice from each
applicable Rating Agency in connection with the satisfaction of such Rating
Agency Condition.
"Miscellaneous Payments" shall mean, with respect to any Collection
Period and the related Distribution Date, the sum of (a) Adjustment Payments and
Transfer Deposit Amounts on deposit in the Collection Account on such
Distribution Date and (b) Unallocated Principal Collections available to be
treated as Miscellaneous Payments pursuant to Section 4.4 on such Distribution
Date.
"Monthly Payment Rate" shall mean, unless otherwise specified for a
Series in the related Supplement, for any Collection Period, the percentage
derived from dividing the Principal Collections (without excluding therefrom the
Discount Portions) collected during such Collection Period by the aggregate
balance of the Principal Receivables (without deducting therefrom the Discount
Portions) as of the beginning of such Collection Period.
"Monthly Servicing Fee" shall mean, with respect to any Series, the
amount specified therefor in the related Supplement.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc., or its
successor.
"Net Loss Rate" shall mean, with respect to a Collection Period, the
percentage derived from a fraction, the numerator of which is the aggregate of
the net losses on Receivables (exclusive of the Ineligible Receivables) that
were charged off during such Collection Period (i.e., gross losses less any
recoveries (including recoveries from Collateral Security) received in such
Collection Period in respect of charged off Receivables, whether such charge off
occurred in such Collection Period or a prior Collection Period) and the
denominator of which is the aggregate of the Principal Receivables (without
deducting therefrom the Discount Portions) in the Trust at the beginning of such
Collection Period.
"Net Receivables Rate" shall mean, with respect to a Distribution
Date and unless otherwise specified for a Series in the related Supplement, (i)
the weighted average of the interest rates borne by the Receivables during the
second Collection Period preceding such Distribution Date (interest payments on
the Receivables at such rates being due and payable in the Collection Period
preceding such Distribution Date) plus (ii) the product of (x) the Monthly
Payment Rate for the Collection Period preceding such Distribution Date, (y) the
Discount Factor for such Distribution Date and (z) twelve less (iii) 2% per
annum.
"Non-Principal Collections" shall mean the sum of (a) Collections of
interest and all other non-principal charges (including insurance service fees
and handling fees) on the Receivables, (b) the product of (i) principal payments
on the Receivables and (ii) the Discount Factor, and (c) all Recoveries.
16
"Non-Principal Receivables" with respect to any Account shall mean
all amounts billed to the related Dealer in respect of interest and all other
non-principal charges.
"Notice Date" shall have the meaning specified in Section 2.5(c).
"NSF" shall mean, with respect to a Receivable, that a check in
payment of such Receivable has been returned because of insufficient funds and
has not thereafter been paid.
"Officers' Certificate" with respect to any corporation (in the case
of the Seller, the Officers' Certificate shall be with respect to Deutsche FRI)
shall mean, unless otherwise specified in this Agreement, a certificate signed
by (a) the Chairman of the Board, Vice Chairman of the Board, President or any
Vice President and (b) a Treasurer, Associate or Assistant Treasurer, Secretary
or Assistant Secretary of such corporation.
"Opinion of Counsel" shall mean a written opinion of counsel, who
may be counsel of the Seller or DFS and who shall be acceptable to the Trustee.
"Overconcentrated Dealer" shall have the meaning specified in the
definition of Dealer Overconcentration.
"Overconcentration Amount" on any Determination Date shall mean the
sum of the Asset Based Receivable Overconcentration, the A/R Receivable
Overconcentration, the Manufacturer Overconcentrations and the Product Line
Overconcentrations on such Determination Date.
"Overconcentration Percentage" on any Determination Date shall mean,
with respect to an Overconcentrated Dealer, the percentage equivalent of a
fraction, (a) the numerator of which is equal to the result of (i) the aggregate
amount of Principal Receivables in all Accounts of such Dealer as of the end of
the Collection Period immediately preceding such Determination Date, minus (ii)
the product of (A) the Concentration Limit Percentage for such Overconcentrated
Dealer, and (B) the Unconcentrated Pool Balance as of the end of such Collection
Period, and (b) the denominator of which is the amount determined in accordance
with clause (a)(i).
"Participation Agreement" shall mean an agreement between DFS or an
Approved Affiliate and a lender (i) pursuant to which DFS or such Approved
Affiliate, as applicable, conveys to such lender an undivided interest in
certain receivables that is pari passu in all respects (other than
nonsubordinated interest strips and fees) with the undivided interest retained
by DFS or such Approved Affiliate, as applicable, and (ii) that satisfies the
applicable requirements of the Receivables Contribution and Sale Agreement.
"Participation Interest" shall mean the undivided interest, created
pursuant to a Participation Agreement, in a receivable in which a Receivable
represents the remaining undivided interest. The Trustee is hereby authorized to
execute and deliver any documentation reasonably requested and prepared by the
Seller in order to effect and evidence any Participation Interest, subject in
each case to the terms and conditions of this Agreement and the Receivables
Contribution and Sale Agreement.
17
"Paying Agent" shall mean any Person authorized by the Trustee to
make distributions of principal of or interest on any Certificates on behalf of
the Trustee.
"Permitted Transactions" shall have the meaning specified in Section
2.6(f).
"Person" shall mean any legal person, including any individual,
corporation, partnership, association, limited liability company, joint-stock
company, trust, unincorporated organization, governmental entity or other
entity.
"Pool Balance" shall mean, as of the time of determination thereof,
the product of (a) the aggregate of Principal Receivables (without deducting
therefrom the Discount Portion) in the Trust at such time (other than all
Ineligible Receivables) and (b) 1 minus the Discount Factor.
"Principal Collections" shall mean Collections under the Receivables
other than Non-Principal Collections.
"Principal Receivables" with respect to an Account shall mean
amounts shown on the Servicer's records as Receivables (other than such amounts
which represent Non-Principal Receivables and Discount Portions) payable by the
related Dealer.
"Principal Terms" shall mean, with respect to any Series, one or
more of the following items, not all of which will necessarily apply to each
Series: (a) the name or designation; (b) the initial principal amount (or method
for calculating such amount), if applicable; (c) the Certificate Rate or
Certificate Rates (or method for the determination thereof); (d) the payment
date or dates and the date or dates from which interest shall accrue; (e) the
method for allocating Collections to Investor Certificateholders; (f) the
designation of any Series Accounts and the terms governing the operation of any
such Series Accounts; (g) the Monthly Servicing Fee and the Investors' Servicing
Fee; (h) any Enhancement Provider for and terms of any form of Enhancement with
respect thereto; (i) the terms on which the Investor Certificates of such Series
may be exchanged for Investor Certificates of another Series, repurchased,
redeemed in an optional redemption or mandatory redemption or remarketed to
other investors; (j) the Termination Date; (k) the number of Classes of Investor
Certificates of such Series and, if more than one Class, the rights and
priorities of each such Class; (l) the extent to which the Investor Certificates
of such Series shall be issuable in temporary or permanent global form (and, in
such case, the depositary for such Global Certificate or certificates, the terms
and conditions, if any, upon which such Global Certificate may be exchanged, in
whole or in part, for Definitive Certificates, and the manner in which any
interest payable on a temporary or Global Certificate shall be paid); (m)
whether the Investor Certificates of such Series may be issued in bearer form
and any limitations imposed thereon; (n) the priority of such Series with
respect to any other Series; (o) whether such Series shall be part of a group;
(p) the date on which such Series will begin its accumulation period,
amortization period or controlled amortization period, if any; and (q) any other
terms of such Series which are permitted or not prohibited by this Agreement.
"Product Line Overconcentration" on any Determination Date shall
mean, with respect to Accounts created pursuant to Wholesale Financing
Agreements, the excess of (a) the aggregate of all amounts of Principal
Receivables in such Accounts that represent financing for a single Product line
(according to DFS's classification system) on the last day of the Collection
18
Period immediately preceding such Determination Date over (b) (i) 25% of the
Pool Balance on the last day of such immediately preceding Collection Period if
such Product line is not computers and related equipment and (ii) 40% of such
Pool Balance if such Product line is computers and related equipment or, in the
case of clause (i) or (ii), if the Rating Agency Condition is satisfied, such
larger percentage of such Pool Balance as is stated in the applicable notice
from each applicable Rating Agency in connection with the satisfaction of such
Rating Agency Condition.
"Products" shall mean the commercial and consumer goods financed by
DFS or the related Approved Affiliate for Dealers pursuant to a Wholesale
Financing Agreement.
"Purchase Price" shall mean, with respect to any Receivable for any
date on which such Receivable is to be purchased pursuant to Section 3.3 or by
DFS as a result of the breach of representations and warranties in the
Receivables Contribution and Sale Agreement, (a) an amount equal to the amount
payable by the Dealer in respect thereof as reflected in the records of the
Servicer as of the date of purchase plus (b) interest accrued (to the extent
interest accrues on such Receivable) from the end of the last Collection Period
in respect of which interest on such Receivable was billed by the Servicer, at a
per annum rate equal to the rate being charged to the Dealer under the Wholesale
Financing Agreement, Accounts Receivable Financing Agreement or Asset Based
Lending Financing Agreement, as the case may be, based on the actual number of
days elapsed over a year of 360 days.
"Rating Agency" shall mean, with respect to any outstanding Series
or Class, each statistical rating agency, if any, selected by the Seller to rate
the Investor Certificates of such Series or Class.
"Rating Agency Condition" shall mean, with respect to any action,
that each Rating Agency shall have notified the Seller, the Servicer and the
Trustee in writing that such action shall not result in a reduction or
withdrawal of such Rating Agency's rating of any outstanding Series or Class
with respect to which it is a Rating Agency. The Rating Agency Condition shall
be inapplicable at any time that no such Series or Class is outstanding.
"Reassignment" shall have the meaning specified in Section 2.7(c).
"Receivables" shall mean, with respect to an Account, all amounts
payable (including interest, finance charges and other charges), and the
obligation to pay such amounts, by the related Dealer from time to time in
respect of advances made by DFS or the related Approved Affiliate to or on
behalf of such Dealer in connection with the Floorplan Business, the Accounts
Receivable Business, or the Asset Based Lending Business, as the case may be,
together with the group of writings evidencing such amounts and the security
interest created in connection therewith and all of the rights, remedies, powers
and privileges thereunder (including under the related Financing Agreement);
provided that if a Participation Interest has been created in respect of such
Account, whether before or after that Account has been designated as an Account,
the amounts so payable by the related Dealer that are allocable to such
Participation Interest shall not be part of the "Receivables" in respect of such
Account. A Receivable that, prior to its transfer to the Seller, was subject to
a participation from an Approved Affiliate in favor of DFS shall be considered a
Receivable. Receivables which become Defaulted
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Receivables shall remain in the Trust but shall cease to be included in the Pool
Balance on the day on which they become Defaulted Receivables. Delayed Funding
Receivables shall cease to be included as Receivables on the day on which an
Insolvency Event in respect of DFS occurs, whether or not such Delayed Funding
Receivables are funded after the occurrence of such Insolvency Event.
Receivables which DFS or the related Approved Affiliate is unable to transfer to
the Seller pursuant to the Receivables Contribution and Sale Agreement or which
the Seller is unable to transfer to the Trust as provided in Section 2.6(b) and
Receivables which arise in Designated Accounts from and after the related
Removal Commencement Date shall not be included in calculating the Pool Balance.
"Receivables Contribution and Sale Agreement" shall mean the
Receivables Contribution and Sale Agreement as amended and restated as of
October 1, 1996 among DFS, Deutsche Business Services Corporation and the Seller
(and any Affiliate of DFS which may become a party thereto from time to time).
"Record Date" shall mean, with respect to any Distribution Date, the
close of business on the day preceding such Distribution Date; provided that
with respect to any Distribution Date for a Series for which Definitive
Certificates have been issued pursuant to Section 6.10, subsequent to the
issuance of such Definitive Certificates the Record Date for such Distribution
Date shall be the last day of the month preceding the month in which such
Distribution Date occurs.
"Records" shall mean, with respect to any Receivable, all documents,
books, records and other information (including, without limitation, computer
programs, tapes, discs, punch cards, data processing software and related
property and rights) relating to such Receivable and the related Dealer.
"Recoveries" on any Determination Date shall mean all amounts
received, including Insurance Proceeds, by the Servicer during the Collection
Period immediately preceding such Determination Date with respect to Receivables
which have previously become Defaulted Receivables.
"Reference Rate" shall mean the per annum rate of interest, if any,
designated from time to time by DFS or the related Approved Affiliate, as
applicable, to a Wholesale Financing Agreement, A/R Financing Agreement or Asset
Based Lending Financing Agreement.
"Registered Certificateholder" shall mean the Holder of a Registered
Certificate.
"Registered Certificates" shall have the meaning specified in
Section 6.1.
"Related Accounts" shall mean all Accounts relating to a single
Dealer.
"Related Documents" shall mean, collectively, the Receivables
Contribution and Sale Agreement and, with respect to any Series, any applicable
Enhancement Agreement.
"Removal Commencement Date" shall have the meaning specified in
Section 2.8(a).
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"Removal Date" shall mean a date specified in a Removal Notice as
the date on which the applicable Accounts are to be removed.
"Removal Notice" shall mean a notice delivered by the Seller (or the
Servicer on its behalf) pursuant to Section 2.7 or 2.8 specifying a Removal Date
for Removed Accounts.
"Removed Account" shall have the meaning specified in Section
2.7(b).
"Required Participation Amount" shall mean, at any time of
determination, an amount equal to the sum of the amounts for each Series
obtained by multiplying the Required Participation Percentage for such Series by
the Initial Invested Amount for such Series at such time.
"Required Participation Percentage" shall mean, with respect to any
Series, the percentage specified therefor in the related Supplement. However,
the Dealer Overconcentration Series shall not have a Required Participation
Percentage.
"Requirements of Law" for any Person shall mean the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation, or determination of an
arbitrator or Governmental Authority, in each case applicable to or binding upon
such Person or to which such Person is subject, whether Federal, state or local
(including usury laws and the Federal Truth in Lending Act).
"Responsible Officer" shall mean any officer of the Trustee with
direct responsibility for the administration of this Agreement and also, with
respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with that
relevant subject.
"Revolving Period" shall mean with respect to any Series, the period
specified as such in the related Supplement. However, the Dealer
Overconcentration Series shall not have a period designated as a Revolving
Period.
"SAU" shall mean, with respect to a Receivable, that if such
Receivable was originally secured by a security interest in a Product, such
Product has been sold and such Receivable is not paid in full.
"Seller" shall mean Deutsche FRLP.
"Seller's Certificates" shall mean, collectively, the Deutsche FRLP
Certificate and any outstanding Supplemental Certificates.
"Seller's Interest" shall have the meaning specified in Section 4.1.
"Seller's Participation Amount" shall mean, at any time of
determination, an amount equal to (a) the Pool Balance at such time minus (b)
the aggregate Invested Amounts for all outstanding Series (other than the Dealer
Overconcentration Series, which shall not be considered to have an Invested
Amount) at such time.
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"Series" shall mean (a) any series of Investor Certificates and (b)
the Dealer Overconcentration Series.
"Series Account" shall mean any deposit, trust, escrow, reserve or
similar account maintained for the benefit of the Investor Certificateholders of
any Series or Class, as specified in any Supplement.
"Series Cut-Off Date" shall mean, with respect to any Series, the
date, if any, specified as such in the related Supplement.
"Series Issuance Date" shall mean, with respect to any Series, the
date on which the Investor Certificates of such Series are to be originally
issued in accordance with Section 6.3 and the related Supplement.
"Series 1994-1" shall mean the series of Investor Certificates
issued and designated as "Series 1994-1".
"Service Transfer" shall have the meaning specified in Section 10.1.
"Servicer" shall initially mean DFS, in its capacity as Servicer
under this Agreement, and after any Service Transfer, the Successor Servicer.
"Servicer Default" shall have the meaning specified in Section 10.1.
"Servicing Fee" shall have the meaning specified in Section 3.2.
"Servicing Officer" shall mean any officer of the Servicer involved
in, or responsible for, the administration and servicing of the Receivables
whose name appears on a list of servicing officers furnished to the Trustee by
the Servicer as such list may from time to time be amended.
"Specified Party" means any of the Seller, the Servicer, DFS, if it
is not the Servicer, Deutsche North America, so long as DFS is an Affiliate of
Deutsche North America, or, if Deutsche North America has merged or consolidated
with another Person, the surviving Person (but only so long as DFS is an
Affiliate of the surviving Person) or any other Person which is the direct,
controlling shareholder of DFS.
"Standard & Poor's" shall mean Standard & Poor's, a division of The
McGraw Hill-Companies, Inc., or its successor.
"Successor Servicer" shall have the meaning specified in Section
10.2(a).
"Supplement" shall mean, with respect to any Series, a supplement to
this Agreement, executed and delivered in connection with the original issuance
of the Investor Certificates of such Series, if applicable, pursuant to Section
6.3, and all amendments thereof and supplements thereto. No Investor
Certificates shall be issued pursuant to the Supplement for the Dealer
Overconcentration Series.
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"Supplemental Certificate" shall have the meaning specified in
Section 6.3.
"Tax Opinion" shall mean, with respect to any action, an Opinion of
Counsel to the effect that, for Federal income and Missouri state income and
franchise tax purposes, (a) such action shall not adversely affect the
characterization of the Investor Certificates of any outstanding Series or Class
as debt or as partnership interests, (b) such action shall not cause or
constitute a taxable event with respect to any Investor Certificateholders or
the Trust and (c) in the case of Section 6.3(b), each Class of the Investor
Certificates of the new Series shall be characterized as debt or as partnership
interests.
"Termination Date" shall mean, with respect to any Series, the
termination date, if any, specified in the related Supplement. However, the
Supplement for the Dealer Overconcentration Series shall not specify a
Termination Date.
"Termination Notice" shall have the meaning specified in Section
10.1.
"Termination Proceeds" shall have the meaning specified in Section
12.2(c).
"Transfer Agent and Registrar" shall have the meaning specified in
Section 6.4.
"Transfer Date" shall have the meaning specified in Section 2.1.
"Transfer Deposit Amount" shall mean, with respect to any Receivable
reassigned or assigned to the Seller or the Servicer, as applicable, pursuant to
Section 2.4(c) or Section 3.3, the amounts specified in such Sections.
"Trust" shall mean the Distribution Financial Services Floorplan
Master Trust created by this Agreement, formerly known as the Deutsche Floorplan
Receivables Master Trust, the corpus of which shall consist of the Trust Assets.
"Trust Assets" shall have the meaning specified in Section 2.1.
"Trust Invested Amount" shall mean, at any time of determination,
the sum of the Invested Amounts for all outstanding Series at such time.
"Trust Termination Date" shall have the meaning specified in Section
12.1.
"Trustee" shall mean The Chase Manhattan Bank, or its successor in
interest, or any successor trustee appointed as herein provided.
"UCC" shall mean the Uniform Commercial Code, as amended from time
to time, as in effect in any applicable jurisdiction.
"Unallocated Principal Collections" shall have the meaning specified
in Section 4.4.
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"Unconcentrated Percentage" shall mean, with respect to an
Overconcentrated Dealer, the result of (a) 100% minus (b) the Overconcentration
Percentage for such Overconcentrated Dealer.
"Unconcentrated Pool Balance" shall mean, as of the end of any
Collection Period, the lesser of: (1) the Pool Balance at the end of such
Collection Period, and (2)(a)(i) such Pool Balance minus (ii) the sum of the
Principal Receivables in all Accounts of all Overconcentrated Dealers at the end
of such Collection Period, divided by (b)(i) 100% minus (ii) the sum of (x) the
product of (A) the number of Overconcentrated Dealers as to which the applicable
Concentration Limit Percentage is 3% and (B) 3%, (y) the product of (A) the
number of Overconcentrated Dealers as to which the applicable Concentration
Limit Percentage is 2% and (B) 2%, and (z) the product of (A) the number of
Overconcentrated Dealers as to which the applicable Concentration Limit
Percentage is other than 3% or 2% and (B) in each case, such applicable
Concentration Limit Percentage.
"Vice President" when used with respect to the Seller and Servicer
shall mean any vice president (in the case of the Seller, a vice president of
Deutsche FRI) whether or not designated by a number or word or words added
before or after the title "vice president".
"Wholesale Financing Agreement" shall mean a wholesale financing
agreement entered into by DFS or the related Approved Affiliate and a Dealer in
order to finance Products purchased by such Dealer from a Manufacturer.
SECTION 1.2. Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(b) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate or
other document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles. To the extent that
the definitions of accounting terms in this Agreement or in any such certificate
or other document are inconsistent with the meanings of such terms under
generally accepted accounting principles, the definitions contained in this
Agreement or in any such certificate or other document shall control.
(c) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; Section, Schedule
and Exhibit references contained in this Agreement are references to Sections,
Schedules and Exhibits in or to this Agreement unless otherwise specified; and
the term "including" shall mean "including without limitation."
(d) The definitions contained in this Agreement 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.
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(e) All references to any agreement shall be understood to be
references to such agreement as it may be amended, amended and restated or
otherwise modified from time to time.
SECTION 1.3. Provisions Relating to Rating Agencies. Provisions in
this Agreement relating to Standard & Poor's, Moody's, Fitch, Duff & ▇▇▇▇▇▇ or a
Rating Agency shall be effective only so long as there is a Series of Investor
Certificates outstanding that has been rated by such Rating Agency at the
request of the Seller. By way of illustration and not limitation of the
foregoing, if no Series of Investor Certificates then outstanding has been rated
at the request of the Seller by Fitch, a notice required hereunder to be given
to a Rating Agency need not be given to Fitch and an Eligible Institution need
not have its debt or certificates of deposit rated by Fitch.
ARTICLE II
Conveyance of Receivables
SECTION 2.1. Conveyance of Receivables. By execution of this
Agreement, the Seller does hereby sell, transfer, assign, set over and otherwise
convey, without recourse (except as expressly provided herein), to the Trust for
the benefit of the Certificateholders and the other Beneficiaries on the Closing
Date for the Series issued in 1993, in the case of the Initial Accounts, and on
the applicable Addition Date, in the case of Additional Accounts, (a) all of its
right, title and interest in, to and under the Receivables in each Account and
all Collateral Security with respect thereto owned by the Seller at the close of
business on the Cut-Off Date, in the case of the Initial Accounts, and on the
applicable Additional Cut-Off Date, in the case of Additional Accounts, and all
monies due or to become due and all amounts received with respect thereto and
all proceeds (including "proceeds" as defined in Section 9-306 of the UCC as in
effect in the State of Missouri and Recoveries) thereof, (b) all of the Seller's
rights, remedies, powers and privileges with respect to such Receivables, and
the Receivables conveyed to the Trust in the next sentence, under the related
Floorplan Agreements, if any, (c) all of the Seller's rights, remedies, powers
and privileges with respect to such Receivables under the Receivables
Contribution and Sale Agreement, and (d) without limiting the foregoing, all of
the Seller's right, title and interest in, to and under the Receivables
Contribution and Sale Agreement. As of each Business Day prior to the earlier of
(i) the occurrence of an Early Amortization Event specified in Section 9.1(b),
(c), (d) or (e) and (ii) the Trust Termination Date, on which Receivables are
created in the Accounts (a "Transfer Date"), the Seller does hereby sell,
transfer, assign, set over and otherwise convey, without recourse (except as
expressly provided herein), to the Trust for the benefit of the
Certificateholders and the other Beneficiaries, all of its right, title and
interest in, to and under the Receivables in each Account (other than any
Receivables created in any Designated Account from and after the applicable
Removal Date) and all Collateral Security with respect thereto owned by the
Seller at the close of business on such Transfer Date and not theretofore
conveyed to the Trust, all monies due or to become due and all amounts received
with respect thereto and all proceeds (including "proceeds" as defined in
Section 9-306 of the UCC as in effect in the State of Missouri and Recoveries)
thereof. Such property, together with all monies on deposit in, and Eligible
Investments credited to, the Collection Account or any Series Account, any
Enhancements and the Collateral Security with respect to the Receivables shall
collectively constitute the assets of the Trust (the "Trust Assets"). The
foregoing sale,
25
transfer, assignment, set-over and conveyance and any subsequent sales,
transfers, assignments, set-overs and conveyances do not constitute, and are not
intended to result in, the creation or an assumption by the Trust, the Trustee,
any Agent or any Beneficiary of any obligation of the Servicer, DFS, the Seller,
or any other Person in connection with the Accounts, the Receivables or any
Participation Interest or under any agreement or instrument relating thereto
(including any Participation Agreement), including any obligation to any
Dealers, Manufacturers, or owners of a Participation Interest and DFS (and not
any of the other foregoing Persons) shall continue to perform and be responsible
for their respective obligations under the Financing Agreements, Floorplan
Agreements, Participation Agreements and any related agreements and
arrangements. The foregoing transfer, assignment, setover and conveyance to the
Trust, and any subsequent transfer, assignment, setover and conveyance to the
Trust, shall be made to the Trustee, on behalf of the Trust, and each reference
in this Agreement or any Supplement to any such transfer, assignment, setover
and conveyance shall be construed accordingly.
In connection with such sales, the Seller agrees to record and file,
at its own expense, a financing statement on form UCC-1 (and continuation
statements when applicable) with respect to the Receivables now existing and
hereafter created for the sale of chattel paper, accounts and general
intangibles (as defined in Section 9-105 of the UCC as in effect in any state
where the Seller's or DFS's chief executive offices or books and records
relating to the Receivables are located) meeting the requirements of applicable
state law in such manner and in such jurisdictions as are necessary to perfect
the sale and assignment of the Receivables and the other Trust Assets to the
Trust, and to deliver a file-stamped copy of such financing statements or other
evidence of such filing to the Trustee on or prior to the Closing Date for the
Series issued in 1993, in the case of the Initial Accounts, and (if any
additional filing is so necessary) the applicable Addition Date, in the case of
Additional Accounts. The Trustee shall be under no obligation whatsoever to file
such financing statement, or a continuation statement to such financing
statement, or to make any other filing under the UCC in connection with such
sales.
In connection with such sales, the Seller further agrees, at its own
expense, on or prior to the Closing Date for the Series issued in 1993, in the
case of the Initial Accounts, the applicable Addition Date, in the case of
Additional Accounts, and the applicable Removal Commencement Date, in the case
of Removed Accounts, (a) to cause DFS to indicate in its books and records,
which may include computer files, as required by the Receivables Contribution
and Sale Agreement, that the Receivables created in connection with the Accounts
(other than Removed Accounts) have been sold, and the Collateral Security
assigned, to the Seller in accordance with the Receivables Contribution and Sale
Agreement and sold to the Trust pursuant to this Agreement for the benefit of
the Certificateholders and the other Beneficiaries and (b) to deliver to the
Trustee (or cause DFS to do so) a computer file or microfiche or written list
containing a true and complete list of all such Accounts (other than Removed
Accounts) specifying for each such Account, as of the Cut-Off Date, in the case
of the Initial Accounts, and the applicable Additional Cut-Off Date, in the case
of Additional Accounts, (i) its account number and (ii) the aggregate amount of
Principal Receivables in such Account. Such file or list, as supplemented from
time to time to reflect Additional Accounts and Removed Accounts, shall be
marked as Schedule 1 to this Agreement and is hereby incorporated into and made
a part of this Agreement. The Trustee shall be under no obligation whatsoever to
verify the accuracy or completeness of the information contained in Schedule 1
from time to time.
26
In the event that such sale and assignment is deemed to constitute a
pledge of security for a loan, it is the intent of this Agreement that the
Seller shall be deemed to have granted to the Trustee a first priority perfected
security interest in all of the Seller's right, title and interest to and under
the Receivables and the Collateral Security and all proceeds thereof, the
Floorplan Agreements and the Receivables Contribution and Sale Agreement, and
that this Agreement shall constitute a security agreement under applicable law.
Notwithstanding any other provision of this Agreement, no asset
shall be acquired by the Seller or the Trust or disposed of by the Seller or the
Trust for the primary purpose of recognizing gains or decreasing losses due to
market value changes.
SECTION 2.2. Acceptance by Trustee. (a) The Trustee hereby
acknowledges its acceptance, on behalf of the Trust, of all right, title and
interest previously held by the Seller to the property, now existing and
hereafter created, conveyed to the Trust pursuant to Section 2.1 and declares
that, subject to the terms and conditions hereof and of any Supplement, it shall
maintain such right, title and interest, upon the trust herein set forth, for
the benefit of the Certificateholders and the other Beneficiaries. The Trustee
further acknowledges that, prior to or simultaneously with the execution and
delivery of this Agreement, the Seller delivered to the Trustee the computer
file or microfiche or written list which the Seller represented as being the
computer file or list relating to the Initial Accounts described in the last
paragraph of Section 2.1.
(a) The Trustee shall have no power to create, assume or incur
indebtedness or other liabilities in the name of the Trust other than as
contemplated in this Agreement.
SECTION 2.3. Representations and Warranties of the Seller Relating
to the Seller and the Agreement. The Seller hereby represents and warrants to
the Trust and to the Trustee as of each Closing Date that:
(a) Organization and Good Standing. The Seller is a limited
partnership duly organized and validly existing and in good standing under the
law of the State of Delaware and has, in all material respects, full power,
authority and legal right to own its properties and conduct its business as such
properties are presently owned and such business is presently conducted, and to
execute, deliver and perform its obligations under this Agreement and to execute
and deliver to the Trustee pursuant hereto the Certificates.
(b) Due Qualification. The Seller is duly qualified to do business
and, where necessary, is in good standing as a foreign partnership (or is exempt
from such requirement) and has obtained all necessary licenses and approvals in
each jurisdiction in which the conduct of its business requires such
qualification except where the failure to so qualify or obtain licenses or
approvals would not have a material adverse effect on its ability to perform its
obligations hereunder.
(c) Due Authorization. The execution and delivery of this
Agreement and the applicable Supplement and the Related Documents and the
execution and delivery to the Trustee of the Certificates by the Seller and the
consummation of the transactions provided for or contemplated by this Agreement
and the applicable Supplement and the Related Documents,
27
have been duly authorized by the Seller by all necessary partnership action on
the part of the Seller.
(d) No Conflict. The execution and delivery of this Agreement, the
applicable Supplement, the Related Documents and the Certificates, the
performance of the transactions contemplated by this Agreement and the
applicable Supplement and the Related Documents and the fulfillment of the terms
hereof and thereof, shall not conflict with, result in any breach of any of the
material terms and provisions of, or constitute (with or without notice or lapse
of time or both) a material default under, any indenture, contract, agreement,
mortgage, deed of trust, or other instrument to which the Seller is a party or
by which it or its properties are bound.
(e) No Violation. The execution and delivery of this Agreement,
the applicable Supplement, the Related Documents and the Certificates, the
performance of the transactions contemplated by this Agreement and the
applicable Supplement and the Related Documents and the fulfillment of the terms
hereof and thereof applicable to the Seller, shall not conflict with or violate
any material Requirements of Law applicable to the Seller.
(f) No Proceedings. There are no proceedings or, to the best
knowledge of the Seller, investigations pending or threatened against the Seller
before any Governmental Authority (i) asserting the invalidity of this
Agreement, the applicable Supplement, any of the Related Documents or the
Certificates, (ii) seeking to prevent the issuance of the Certificates or the
consummation of any of the transactions contemplated by this Agreement and the
applicable Supplement or the Related Documents, (iii) seeking any determination
or ruling that, in the reasonable judgment of the Seller, would materially and
adversely affect the performance by the Seller of its obligations under this
Agreement and the applicable Supplement or the Related Documents, (iv) seeking
any determination or ruling that would materially and adversely affect the
validity or enforceability of this Agreement and the applicable Supplement, the
Related Documents or the Certificates or (v) seeking to affect adversely the
income tax attributes of the Trust under the United States Federal or any State
income, single business or franchise tax systems.
(g) All Consents Required. All appraisals, authorizations,
consents, orders, approvals or other actions of any Person or of any
governmental body or official required in connection with the execution and
delivery of this Agreement, the applicable Supplement, the Related Documents and
the Certificates, the performance of the transactions contemplated by this
Agreement, the applicable Supplement and any of the Related Documents, and the
fulfillment of the terms hereof and thereof, have been obtained, except where
the failure to so obtain such item shall not have a material adverse effect on
its ability to render such performance.
(h) Enforceability. This Agreement and the applicable Supplement
and the Related Documents each constitutes a legal, valid and binding obligation
of the Seller enforceable against the Seller in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect affecting the enforcement of creditors' rights in general and except as
such enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity).
28
(i) Record of Accounts. As of the Closing Date for the Series
issued in 1993, in the case of the Initial Accounts, as of the applicable
Addition Date, in the case of the Additional Accounts, and, as of the applicable
Removal Date, in the case of Removed Accounts, Schedule 1 to this Agreement is
an accurate and complete listing in all material respects of all the Accounts as
of the Cut-Off Date, the applicable Additional Cut-Off Date or the applicable
Removal Date, as the case may be, and the information contained therein with
respect to the identity of such Accounts and the Receivables existing thereunder
is true and correct in all material respects as of the Cut-Off Date, such
applicable Additional Cut-Off Date or such Removal Date, as the case may be.
(j) Valid Transfer. This Agreement or, in the case of Additional
Accounts, the related Assignment constitutes a valid sale, transfer and
assignment to the Trust of all right, title and interest of the Seller in the
Receivables and the Collateral Security and the proceeds thereof and all of the
Seller's rights, remedies, powers and privileges with respect to the Receivables
under the Receivables Contribution and Sale Agreement and the related Financing
Agreements and Floorplan Agreements, if any, and, upon the filing of the
financing statements described in Section 2.1 with the applicable filing office
and, in the case of the Receivables hereafter created and the proceeds thereof,
upon the creation thereof, the Trust shall have a perfected ownership interest
in such property, free of the Liens of any other Person, except for Liens
permitted under Section 2.6(a). Except as otherwise provided in this Agreement,
neither the Seller nor any Person claiming through or under the Seller has any
claim to or interest in the Trust Assets.
The representations and warranties set forth in this Section 2.3
shall survive the transfer and assignment of the Receivables to the Trust and
the issuance of the Certificates. Upon discovery by the Seller, the Servicer,
any Agent or any Responsible Officer of the Trustee of a breach of any of the
foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other parties, any Agent and to any
Enhancement Providers.
In the event of any breach of any of the representations and
warranties set forth in this Section 2.3 having a material adverse effect on the
interests of the Investor Certificateholders, then either the Trustee or the
Holders of Investor Certificates evidencing not less than a majority in
aggregate unpaid principal amount of all outstanding Investor Certificates, by
notice then given in writing to the Seller (and to the Trustee, any Enhancement
Providers and the Servicer if given by the Investor Certificateholders), may
direct the Seller to purchase the Certificateholders' Interest within 60 days of
such notice (or within such longer period as may be specified in such notice),
and the Seller shall be obligated to make such purchase on a Distribution Date
occurring within such 60-day period on the terms and conditions set forth below;
provided, however, that no such purchase shall be required to be made if, by the
end of such 60-day period (or such longer period as may be specified), the
representations and warranties set forth in this Section 2.3 shall be true and
correct in all material respects, and any material adverse effect on the
Certificateholders' Interest caused thereby shall have been cured.
The Seller shall deposit in the Collection Account in immediately
available funds on the Business Day preceding such Distribution Date, in payment
for such purchase, an amount equal to the sum of the amounts specified therefor
with respect to each outstanding Series in the
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related Supplement. Notwithstanding anything to the contrary in this Agreement,
such amounts shall be distributed to the Investor Certificateholders on such
Distribution Date in accordance with Article IV and the terms of each
Supplement. If the Trustee or the Investor Certificateholders give notice
directing the Seller to purchase the Certificateholders' Interest as provided
above, the obligation of the Seller to purchase the Certificateholders' Interest
pursuant to this Section 2.3 shall constitute the sole remedy respecting an
event of the type specified in the first sentence of this Section 2.3 available
to the Investor Certificateholders (or the Trustee on behalf of the Investor
Certificateholders).
SECTION 2.4. Representations and Warranties of the Seller Relating
to the Receivables. (a) Representations and Warranties. The Seller hereby
represents and warrants to the Trustee and the Trust that:
(i) Each Receivable and all other Trust Assets existing on
the Closing Date for the Series issued in 1993 or, in the case of
Additional Accounts, on the applicable Addition Date, and on each Transfer
Date, has been conveyed to the Trust free and clear of any Lien.
(ii) With respect to each Receivable and all other Trust
Assets existing on the Closing Date for the Series issued in 1993 or, in
the case of Additional Accounts, on the applicable Addition Date, and on
each Transfer Date, all consents, licenses, approvals or authorizations of
or registrations or declarations with any Governmental Authority required
to be obtained, effected or given by the Seller in connection with the
conveyance of such Receivable or other Trust Assets to the Trust have been
duly obtained, effected or given and are in full force and effect.
(iii) On the Cut-Off Date, each Initial Account was an
Eligible Account. On the applicable Additional Cut-Off Date, each
applicable Additional Account is an Eligible Account. On the date any
Receivables are transferred to the Trust, the related Account or
Additional Account was or is an Eligible Account or if it was or is an
Ineligible Account on such date, such Account is being removed from the
Trust in accordance with Section 2.8.
(iv) On the Closing Date for the Series issued in 1993, in
the case of the Initial Accounts, and, in the case of the Additional
Accounts, on the applicable Additional Cut-Off Date, and on each Transfer
Date, each Receivable conveyed to the Trust on such date is an Eligible
Receivable or, if such Receivable is not an Eligible Receivable, the
Account relating to such Receivable is an Eligible Account in accordance
with Section 2.9.
(b) Notice of Breach. The representations and warranties set forth
in this Section 2.4 shall survive the transfer and assignment of the Receivables
to the Trust and the issuance of the Certificates. Upon discovery by the Seller,
the Servicer, any Agent or a Responsible Officer of the Trustee of a breach of
any of the representations and warranties set forth in this Section 2.4, the
party discovering such breach shall give prompt written notice to the other
parties and to any Enhancement Providers.
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(c) Reassignment. In the event any representation or warranty
under Section 2.4(a) is not true and correct as of the date specified therein
with respect to any Receivable or Account and such breach has a material adverse
effect on the Certificateholders' Interest in any such Receivable or Account,
then, within 30 days (or such longer period as may be agreed to by the Trustee)
of the earlier to occur of the discovery of any such event by the Seller or the
Servicer, or receipt by the Seller or the Servicer of written notice of any such
event given by the Trustee, any Agent or any Enhancement Provider, the Seller
shall accept a reassignment of such Receivable or, in the case of such an untrue
representation or warranty with respect to an Account, all Receivables in such
Account, on the Determination Date immediately succeeding the day of such
discovery or notice on the terms and conditions set forth in the next succeeding
paragraph; provided, however, that no such reassignment shall be required to be
made with respect to such Receivable if, by the end of such 30-day period (or
such longer period as may be agreed to by the Trustee), the breached
representation or warranty shall then be true and correct in all material
respects and any material adverse effect caused thereby shall have been cured.
The Seller shall accept a reassignment of each such Receivable by
directing the Servicer to deduct, subject to the next sentence, the principal
amount of such Receivables (exclusive of their Discount Portions) from the Pool
Balance on or prior to the end of the Collection Period in which such
reassignment obligation arises. If, following such deduction, the Pool Balance
would be less than the Required Participation Amount on the immediately
preceding Determination Date (after giving effect to the allocations,
distributions, withdrawals and deposits to be made on the Distribution Date
following such Determination Date), then not later than 12:00 noon New York City
time on the day on which such reassignment occurs, the Seller shall deposit in
the Collection Account in immediately available funds the amount (the "Transfer
Deposit Amount") by which the Pool Balance would be less than the Required
Participation Amount (up to the principal amount of such Receivables exclusive
of the Discount Portions thereof); provided that if the Transfer Deposit Amount
is not deposited as required by this sentence, then the amounts to be deducted
in respect of such Receivables shall only be deducted from the Pool Balance to
the extent that the Pool Balance is not reduced below the Required Participation
Amount and the Receivables, the amounts to be deducted in respect of which have
not been so deducted, shall not be reassigned to the Seller and shall remain
part of the Trust. Upon reassignment of any such Receivable, but only after
payment by the Seller of the Transfer Deposit Amount, if any, the Trust shall
automatically and without further action be deemed to sell, transfer, assign,
set over and otherwise convey to the Seller, without recourse, representation or
warranty, all the right, title and interest of the Trust in and to such
Receivable, all Collateral Security and all moneys due or to become due with
respect thereto and all proceeds thereof. The Trustee shall execute such
documents and instruments of transfer or assignment as shall be furnished by the
Seller and shall take such other actions as shall reasonably be requested by the
Seller, to effect the conveyance of such Receivables pursuant to this Section.
The obligation of the Seller to accept a reassignment of any such Receivable and
to pay any related Transfer Deposit Amount shall constitute the sole remedy
respecting the event giving rise to such obligation available to
Certificateholders (or the Trustee on behalf of Certificateholders).
SECTION 2.5. Addition of Accounts. (a) If, on any Distribution Date,
(i) the Pool Balance (for purposes of this paragraph, determined by excluding
from the calculation thereof all Delayed Funding Receivables) as of the close of
business on the last day of the
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preceding Collection Period is less than the Required Participation Amount as of
such Distribution Date (after giving effect to the allocations, distributions,
withdrawals and deposits to be made on such Distribution Date), or (ii) the
result obtained by multiplying (x) the Seller's Participation Amount (for
purposes of this paragraph, determined by using the Pool Balance as determined
in accordance with this paragraph) as of such Distribution Date (after giving
effect to the allocations, distributions, withdrawals and deposits to be made on
such Distribution Date), by (y) the percentage equivalent of the portion of the
Seller's Interest represented by the Deutsche FRLP Certificate, is less than 5%
of the Pool Balance on such last day, then the Seller shall, within 10 Business
Days following such Distribution Date, designate additional Eligible Accounts to
be included as Accounts and transfer to the Trust the Receivables (and the
related Collateral Security) of those Additional Accounts in a sufficient amount
such that after giving effect to such designation and transfer: (i) the Pool
Balance (determined in accordance with this paragraph) as of the close of
business on the Addition Date is at least equal to such Required Participation
Amount; and (ii) the result obtained by multiplying (x) such Seller's
Participation Amount (determined in accordance with this paragraph) by (y) the
percentage equivalent of the portion of the Seller's Interest represented by the
Deutsche FRLP Certificate, is at least equal to 5% of such Pool Balance, as the
case may be. The Seller shall satisfy the conditions specified in Section 2.5(d)
in designating such Additional Accounts and conveying the related Receivables to
the Trust. The failure of the Seller to transfer Receivables to the Trust as
provided in this paragraph solely as a result of the unavailability of a
sufficient amount of Eligible Receivables shall not constitute a breach of this
Agreement; provided, however, that any such failure shall nevertheless result in
the occurrence of an Early Amortization Event described in Section 9.1(a).
(b) The Seller may from time to time, at its sole discretion,
subject to the conditions specified in paragraph (d) below, voluntarily
designate additional Eligible Accounts to be included as Accounts and transfer
to the Trust the Receivables (and the related Collateral Security) of such
Additional Accounts.
(c) Receivables and Collateral Security from such Additional
Accounts shall be sold to the Trust effective on a date (each an "Addition
Date") specified in a written notice provided by the Seller (or the Servicer on
its behalf) to the Trustee, the Rating Agencies, any Agent and any Enhancement
Providers specifying the Additional Cut-Off Date and the Addition Date for such
Additional Accounts (each an "Addition Notice") on or before the fifth Business
Day but not more than the 30th day prior to the related Addition Date or, if the
Automatic Addition Condition is satisfied, on the Determination Date following
the Collection Period in which such Addition Dates occur (the "Notice Date"). An
Addition Notice may relate to one or more Accounts added on one or more Addition
Dates.
(d) The Seller shall be permitted to convey to the Trust the
Receivables and all Collateral Security related thereto in any Additional
Accounts designated by the Seller as such pursuant to Section 2.5(a) or (b) only
upon satisfaction of each of the following conditions on or prior to the related
Addition Date (except for the condition in clause (vii), if applicable, which
shall be satisfied on or before the tenth Business Day after the applicable
Notice Date):
(i) the Seller shall have provided the Trustee, any Agent,
the Rating Agencies and any Enhancement Providers with a timely Addition
Notice;
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(ii) such Additional Accounts shall all be Eligible Accounts;
(iii) the Seller shall have delivered to the Trustee a duly
executed written assignment (including an acceptance by the Trustee) in
substantially the form of Exhibit B (the "Assignment") covering the
Receivables in the Accounts specified in the Addition Notice and the
computer file or microfiche or written list required to be delivered
pursuant to Section 2.1;
(iv) the Seller shall, to the extent required by Section 4.3,
have deposited in the Collection Account all Collections with respect to
such Additional Accounts since the Additional Cut-Off Date;
(v) (A) no selection procedures reasonably believed by the
Seller to be adverse to the interests of the Beneficiaries shall have been
used in selecting such Additional Accounts; (B) the list of Additional
Accounts delivered pursuant to clause (iii) above shall be true and
correct in all material respects as of the Additional Cut-Off Date and (C)
as of each of the Notice Date and the Addition Date, neither DFS nor the
Seller shall have been insolvent nor shall any of them have been made
insolvent by such transfer nor shall any of them be aware of any pending
insolvency;
(vi) if the Automatic Addition Condition is not satisfied
with respect to such addition, the Rating Agency Condition shall have been
satisfied with respect to such addition, provided that the Rating Agency
Condition must be satisfied for any Additional Account designated pursuant
to Section 2.5(b) if such Additional Account contains Asset Based
Receivables (or, if such Additional Account contains A/R Receivables if a
Participation Interest has been created in such A/R Receivables);
(vii) If (A) one or more of the Additional Accounts specified
in such Addition Notice shall contain Receivables secured by a security
interest in a type of Product that has not been previously financed in the
Floorplan Business or (B) one or more of the Additional Accounts is
supported by a Floorplan Agreement with a Manufacturer that, as of the
related Addition Date, is not an Existing Manufacturer, then, whether or
not the Automatic Condition is satisfied, the Rating Agency Condition
shall have been satisfied in respect of the addition of each Additional
Account specified in clauses (A) and (B) on or prior to the related
Addition Date;
(viii) the addition of the Receivables arising in such
Additional Accounts shall not result in the occurrence of an Early
Amortization Event;
(ix) the Seller shall have delivered to the Trustee and any
Enhancement Providers a certificate of a Vice President or more senior
officer confirming (A) the items set forth in paragraphs (ii) through
(vii) above and (B) that the Seller reasonably believes that the addition
of the Receivables arising in such Additional Accounts shall not result in
the occurrence of an Early Amortization Event; and
(x) the Seller shall have delivered to the Trustee and any
Enhancement Providers (A) an Opinion of Counsel with respect to the
Receivables in the Additional Accounts added since the last delivery of
such Opinion substantially in the form of
33
Exhibit G-2 and (B) except in the case of an addition required by Section
2.5(a), a Tax Opinion with respect to such addition; provided that if such
Opinion of Counsel and Tax Opinion are required to be delivered, they
shall be from outside counsel no less frequently than quarterly; provided
further that, unless the Rating Agency Condition is satisfied, such
Opinion of Counsel and Tax Opinion shall be from outside counsel if the
rating of the unsecured long-term debt of the parent of DFS or, if DFS
does not have a parent, DFS is below investment grade.
(e) The Seller hereby represents and warrants as of the applicable
Addition Date as to the matters set forth in Section 2.5(d)(v). Upon discovery
by the Seller, the Servicer, any Agent, a Responsible Officer of the Trustee or
any Enhancement Providers of a breach of the foregoing representations and
warranties, the party discovering the breach shall give prompt written notice to
the other parties, to any Agent and to any Enhancement Providers.
(f) Notwithstanding anything in this Section 2.5 to the contrary,
the additions of Additional Accounts pursuant to Section 2.5(b) on or prior to
the Closing Date for Series 1994-1 need not satisfy clause (i), (vi), (vii) or
(x) of Section 2.5(d).
SECTION 2.6. Covenants of the Seller. The Seller hereby covenants
that:
(a) No Liens. Except for the conveyances hereunder or as provided
in Section 6.3(c), the Seller shall not sell, pledge, assign or transfer to any
other Person, or grant, create, incur, assume or suffer to exist any Lien on,
any Receivable or any other Trust Asset, whether now existing or hereafter
created, or any interest therein, Seller's Interest or the Seller's Certificates
and the Seller shall defend the right, title and interest of the Trust in, to
and under the Receivables and the other Trust Assets, whether now existing or
hereafter created, and such rights, remedies, powers and privileges, against all
claims of third parties claiming through or under the Seller.
(b) Account Allocations. In the event that the Seller is unable
for any reason to transfer Receivables to the Trust, then the Seller agrees that
it shall allocate, after the occurrence of such event, payments on each Account
with respect to the principal balance of such Account first to the oldest
principal balance of such Account and to have such payments applied as
Collections in accordance with the terms of this Agreement. The parties hereto
agree that Non-Principal Receivables, whenever created, accrued in respect of
Principal Receivables which have been conveyed to the Trust shall continue to be
a part of the Trust notwithstanding any cessation of the transfer of additional
Principal Receivables to the Trust and Collections with respect thereto shall
continue to be allocated and paid in accordance with the terms of this
Agreement.
(c) Delivery of Collections. In the event that the Seller, DFS or
any Affiliate thereof receives payments in respect of Receivables, the Seller
and DFS agree to pay or cause to be paid to the Servicer or any Successor
Servicer all payments received thereby in respect of the Receivables as soon as
practicable after receipt thereof, but in no event later than two Business Days
after the receipt by the Seller, DFS or any Affiliate thereof.
34
(d) Notice of Liens. The Seller shall notify the Trustee promptly
after becoming aware of any Lien on any Receivable other than the conveyances
hereunder and Participation Interests.
(e) Compliance with Law. The Seller hereby agrees to comply in all
material respects with all Requirements of Law applicable to the Seller.
(f) Activities of the Seller. The Seller shall not engage in any
business or activity of any kind or enter into any transaction other than (i)
the businesses, activities and transactions contemplated and authorized by this
Agreement or the Related Documents, (ii) acquiring, selling, financing, holding,
assigning, pledging and otherwise dealing with receivables arising out of the
financing of commercial and consumer products, accounts receivable and other
assets and related activities and transactions or out of unsecured loans, (iii)
transferring such receivables to trusts pursuant to a pooling and servicing
agreement or similar agreement or arrangement, (iv) authorizing, selling and
delivering any class of certificates or other securities of any such trust, (v)
issuing, selling, authorizing and delivering one or more series and classes of
bonds, notes or other evidences of indebtedness secured or collateralized by one
or more pools of receivables or by certificates of any class issued by one or
more trusts (collectively, the "Notes"), provided that the Seller shall have no
liability under any Notes except to the extent of the one or more pools of
receivables or the certificates securing or collateralizing such Notes, (vi)
holding and enjoying all of the rights and privileges of any certificates issued
by the trusts to the Seller under the related agreements and holding and
enjoying all of the rights and privileges of any class of any series of Notes,
including any class of Notes or certificates which may be subordinate to any
other class of Notes or certificates, respectively, (vii) performing its
obligations under the agreements and any indenture or other agreement (each, an
"Indenture") pursuant to which any Notes are issued, (viii) engaging in any
activity and exercising any powers permitted to limited partnerships under the
laws of the State of Delaware that are related or incidental to the foregoing
and necessary, convenient or advisable to accomplish the foregoing, and (ix) any
other activity in connection with which the Rating Agency Condition has been
satisfied (such businesses, activities and transactions, collectively,
"Permitted Transactions").
(g) Indebtedness. The Seller shall not create, incur or assume any
indebtedness or issue any securities or sell or transfer any receivables to a
trust or other Person which issues securities in respect of any such
receivables, unless (i) any such indebtedness or securities have no recourse to
any assets of the Seller other than the specified assets to which such
indebtedness or securities relate and (ii) the Rating Agency Condition shall
have been satisfied in connection therewith prior to the incurrence or issuance
thereof.
(h) Guarantees. The Seller shall not become or remain liable,
directly or contingently, in connection with any indebtedness or other liability
of any other Person, whether by guarantee, endorsement (other than endorsements
of negotiable instruments for deposit or collection in the ordinary course of
business), agreement to purchase or purchase, agreement to supply or advance
funds, or otherwise, except in connection with Permitted Transactions and unless
the Rating Agency Condition shall have been satisfied with respect thereto.
(i) Investments. The Seller shall not make or suffer to exist any
loans or advances to, or extend any credit to, or make any investments (by way
of transfer of property,
35
contributions to capital, purchase of stock or securities or evidences of
indebtedness, acquisition of the business or assets, or otherwise) in, any
Affiliate, unless prior thereto the Rating Agency Condition shall have been
satisfied with respect thereto; provided, however, that the Seller shall not be
prohibited under this Section 2.6(i) from making distributions to its partners.
(j) Stock; Merger. The Seller shall not (i) sell any general
partner's interests in the Seller to any Person (other than Deutsche FRI), or
enter into any transaction of merger or consolidation unless (A) the surviving
Person of such merger or consolidation assumes all of the Seller's obligations
under this Agreement, (B) the Seller shall have given the Rating Agencies and
the Trustee at least 10 days' prior notice and the Rating Agency Condition shall
have been satisfied with respect to such transaction and (C) such merger or
consolidation does not conflict with any provisions of the partnership agreement
of the Seller, or (ii) terminate, liquidate or dissolve itself (or suffer any
termination, liquidation or dissolution), or (iii) acquire or be acquired by any
Person, or (iv) otherwise make (or suffer) any material change in the
organization of or method of conducting its business.
(k) Agreements. The Seller shall not become a party to, or permit
any of its properties to be bound by, any indenture, mortgage, instrument,
contract, agreement, lease or other undertaking, except this Agreement, the
Related Documents and any document relating to a Permitted Transaction, or amend
or modify its partnership agreement or cancel, terminate, amend, supplement,
modify or waive any of the provisions of the Receivables Contribution and Sale
Agreement or any of the other Related Documents or request, consent or agree to
or suffer to exist or permit any such cancellation, termination, amendment,
supplement, modification or waiver unless, in any such case, the Rating Agency
Condition shall have been satisfied with respect thereto.
(l) Separate Existence. The Seller shall take all reasonable steps
to make it apparent to third Persons that the Seller is an entity with assets
and liabilities distinct from those of DFS and any other Affiliate and that the
Seller is not a division of DFS or any other Person.
SECTION 2.7. Removal of Eligible Accounts. (a) On each Determination
Date the Seller shall have the right to remove Eligible Accounts in the manner
prescribed in Section 2.7(b). The termination of an Account by a Dealer upon
such Dealer's payment in full of the Receivables in the related Account shall
not be a removal of such Account for purposes of this Section 2.7.
(b) To remove Eligible Accounts, the Seller (or the Servicer on
its behalf) shall take the following actions and make the following
determinations:
(i) not less than five Business Days prior to the Removal
Date, furnish to the Trustee, any Agent, any Enhancement Providers and the
Rating Agencies a Removal Notice specifying the Removal Date, which shall
be a Determination Date (which may be a Determination Date on which such
Removal Notice is given) on which removal of one or more Accounts (the
"Removed Accounts") shall occur;
(ii) from and after such Removal Date, cease to transfer to
the Trust any and all Receivables arising in such Removed Accounts;
36
(iii) represent and warrant that the removal of any such
Eligible Account on any Removal Date shall not, in the reasonable belief
of the Seller, cause an Early Amortization Event to occur or cause the
Pool Balance to be less than the Required Participation Amount;
(iv) represent and warrant that no selection procedures
reasonably believed by the Seller to be adverse to the interests of the
Beneficiaries were utilized in selecting the Accounts to be removed;
(v) cause the Rating Agency Condition to be satisfied with
respect to such removal;
(vi) deliver to the Trustee, each Rating Agency, any Agent
and any Enhancement Providers a Tax Opinion, dated the Removal Date, with
respect to such removal;
(vii) on or before the related Removal Date, deliver to the
Trustee, any Agent and any Enhancement Providers an Officers' Certificate
confirming the items set forth in clauses (iii) through (v) above and
confirming that the Seller reasonably believes that the removal of the
Removed Accounts shall not result in the occurrence of an Early
Amortization Event; the Trustee may conclusively rely on such Officers'
Certificate and shall have no duty to make inquiries with regard to the
matters set forth therein and shall incur no liability in so relying; and
(viii) on or before the fifth Business Day after the Removal
Date, furnish to the Trustee a computer file, microfiche list or other
list of the Removed Accounts that were removed on the Removal Date,
specifying for each Removed Account as of the date of the Removal Notice
its number, the aggregate amount outstanding in such Removed Account and
the aggregate amount of Principal Receivables therein and represent that
such computer file, microfiche list or other list of the Removed Accounts
is true and complete in all material respects and such Removed Accounts
shall be deemed to have been removed from the list of Accounts maintained
by the Trustee.
No Accounts shall be so removed if such removal shall result in a reduction or
withdrawal of the rating of any outstanding Series or Class by the applicable
Rating Agency.
(b) Subject to Section 2.7(b), on the Removal Date with respect to
any such Removed Account, such Removed Account shall be deemed removed from the
Trust for all purposes. After the Removal Date and upon the written request of
the Servicer, the Trustee shall deliver to the Seller a reassignment in
substantially the form of Exhibit H (the "Reassignment").
SECTION 2.8. Removal of Ineligible Accounts. (a) The date on which
the Seller or the Servicer becomes aware that an Account is an Ineligible
Account shall be the "Removal Commencement Date" with respect to such Account.
(b) With respect to each Account that becomes an Ineligible
Account, the Seller (or the Servicer on its behalf) shall take the following
actions and make the following determinations:
37
(i) promptly following the related Removal Commencement
Date, furnish to the Trustee, any Agent and any Enhancement Providers a
Removal Notice specifying the Removal Commencement Date and the Ineligible
Accounts to be removed and the related Removal Date, which shall be a date
occurring on or before the next Determination Date (the "Designated
Accounts");
(ii) determine on the Removal Commencement Date with respect
to such Designated Accounts the aggregate balance of Principal Receivables
in respect of each Designated Account (the "Designated Balance") and amend
Schedule 1 by delivering to the Trustee a computer file or microfiche or
written list containing a true and complete list of the Designated
Accounts specifying for each such Designated Account, as of the Removal
Commencement Date, its account number, the aggregate amount of Receivables
outstanding in such Designated Account and the Designated Balance;
(iii) from and after such Removal Commencement Date, cease to
transfer to the Trust any and all Receivables arising in such Designated
Accounts;
(iv) if such Account was an Ineligible Account at the time it
was originally designated as an Account, from and after such Removal
Commencement Date, allocate Collections of Principal Receivables in
respect of each Designated Account, first to the oldest outstanding
principal balance of such Designated Account, until the Removal
Commencement Date with respect thereto; and
(v) if such Account was an Ineligible Account at the time it
was originally designated as an Account, on each Business Day from and
after such Removal Commencement Date to and until the related Removal
Date, allocate (A) to the Trust (to be further allocated pursuant to the
terms of this Agreement), Defaulted Receivables and Collections of
Non-Principal Receivables in respect of each Designated Account, based on
the ratio of the aggregate amount of Principal Receivables in all
Designated Accounts owned by the Trust on such Business Day to the total
aggregate amount of Principal Receivables in all such Designated Accounts
on such Business Day and (B) to the Seller, the remainder of the Defaulted
Receivables and Collections of Non-Principal Receivables in all such
Designated Accounts on such Business Day.
(c) On the Removal Commencement Date with respect to any such
Ineligible Account, the Seller shall cease to allocate any Collections therefrom
in accordance herewith and such Account shall be deemed a Removed Account and
shall be deemed removed from the Trust for all purposes. After the Removal
Commencement Date and upon the written request of the Servicer, the Trustee
shall deliver to the Seller a Reassignment.
(d) Notwithstanding any other provision of this Agreement, unless
an Account was an Ineligible Account at the time it was originally designated as
an Account, the Reassignment shall remove only such Account and shall not
reassign any Receivable existing in such Account.
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SECTION 2.9. Sale of Ineligible Receivables. The Seller shall sell
to the Trust on each Transfer Date any and all Receivables arising in any
Eligible Accounts that are Ineligible Receivables, provided that on the Cut-Off
Date or, in the case of Receivables arising in Additional Accounts, on the
related Additional Cut-Off Date, and on the applicable Transfer Date, the
Account in which such Receivables arise is an Eligible Account.
SECTION 2.10. Removal of Receivables in Connection with
Overconcentration Amount. (a) If on any Determination Date the Overconcentration
Amount as of the end of the preceding Collection Period exceeds zero, the Seller
may attempt to reduce the Overconcentration Amount to zero by removing
Receivables from the Trust. However, in attempting to reduce the
Overconcentration Amount to zero, the Seller shall not be permitted to remove a
Receivable (a) that has been classified by the Servicer as SAU or NSF for more
than sixty days, (b) that has been charged off, (c) as to which the related
Dealer is in bankruptcy or insolvency proceedings, or (d) if the Servicer
believes that the Receivable will be charged off in the foreseeable future or
that the related Dealer will be in bankruptcy or insolvency proceedings in the
foreseeable future.
(b) In order to remove Receivables in accordance with Section
2.10(a), the Seller shall send a notice to the Trustee and the Rating Agencies
identifying the proposed removal date and the Receivables to be removed,
together with a certification by the Seller and the Servicer to the effect that
such removal complies with the terms of this Section 2.10. On the proposed
removal date, the Seller shall remit to the Trustee, for deposit in the
Collection Account, an amount equal to the outstanding principal balances of
such Receivables.
(c) The Trustee is hereby authorized to enter into any assignment
documentation reasonably requested and prepared by the Seller in connection with
this Section 2.10.
ARTICLE III
Administration and Servicing
of Receivables
SECTION 3.1. Acceptance of Appointment and Other Matters Relating to
the Servicer. (a) The Servicer shall service and administer the Receivables,
shall collect payments due under the Receivables and shall charge-off as
uncollectible Receivables, all in accordance with its customary and usual
servicing procedures in effect from time to time for servicing wholesale
receivables comparable to the Receivables which the Servicer services for its
own account and in accordance with the Financing Guidelines; provided, however,
that (i) the Servicer shall change its policy for charging off wholesale
receivables as totally uncollectible only upon satisfaction of the Rating Agency
Condition and (ii) in respect of a Floorplan Agreement, the obligation of the
related Manufacturer to repurchase repossessed Products may be modified and
subject to various terms, but shall not be deleted; and provided, further, that
if a Successor Servicer shall succeed to the duties of the Servicer, the
Successor Servicer shall service the Receivables in accordance with standards
that would be employed by a prudent lender in servicing comparable receivables
for its own account. The Servicer shall have full power and authority, acting
alone or through any party properly designated by it hereunder, to do
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any and all things in connection with such servicing and administration which it
may deem necessary or desirable. Without limiting the generality of the
foregoing and subject to Section 10.1, the Servicer is hereby authorized and
empowered, unless such power and authority is revoked by the Trustee on account
of the occurrence of a Servicer Default pursuant to Section 10.1, (i) to
instruct the Trustee to make withdrawals and payments from the Collection
Account and any Series Account as set forth in this Agreement or any Supplement,
(ii) to instruct the Trustee to take any action required or permitted under any
Enhancement, (iii) to execute and deliver, on behalf of the Trust for the
benefit of the Certificateholders and the other Beneficiaries, any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge, and all other comparable instruments, with respect to the Receivables
and, after the delinquency of any Receivable and to the extent permitted under
and in compliance with applicable Requirements of Law, to commence enforcement
proceedings (which, to the extent permitted by applicable law, may be in the
name of the Servicer) with respect to such Receivables, (iv) to make any
filings, reports, notices, applications, registrations with, and seek any
consents or authorizations from, the Securities and Exchange Commission and any
State securities authority on behalf of the Trust as may be necessary or
advisable to comply with any Federal or State securities laws or reporting
requirement, and (v) to delegate certain of its servicing, collection,
enforcement and administrative duties hereunder with respect to the Accounts and
the Receivables to any Person who agrees to conduct such duties in accordance
with the Financing Guidelines (or such other standards required hereunder in the
case of a Successor Servicer) and this Agreement; provided, however, that (a)
the Servicer shall notify the Trustee, the Rating Agencies, any Agent and any
Enhancement Providers in writing of any such delegation of its duties which is
not in the ordinary course of its business, (b) no delegation shall relieve the
Servicer of its liability and responsibility with respect to such duties and (c)
the Rating Agency Condition shall have been satisfied with respect to any
delegation whether that delegation is in the ordinary course of business or
otherwise. The Trustee shall execute and deliver to the Servicer any powers of
attorney and other documents prepared by the Servicer and certified by a
Servicing Officer as being reasonably necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties hereunder.
(b) In the event that the Seller is unable or is not permitted for
any reason to transfer Receivables to the Trust in accordance with the
provisions of this Agreement (including by reason of the application of the
provisions of Section 2.1 or Section 9.2 or any court of competent jurisdiction
ordering that the Seller not transfer any additional Receivables to the Trust)
then, in any such event, the Servicer agrees (i) to give prompt written notice
thereof to the Trustee, any Enhancement Providers, any Agent and each Rating
Agency and (ii) that it shall in any such event allocate, after the occurrence
of such event, Principal Collections with respect to each Account first to the
oldest principal balance of Receivables in such Account, and to have such
payments applied as Collections in accordance with Section 4.2. The parties
hereto agree that Non-Principal Collections with respect to Receivables that are
in the Trust shall continue to be allocated and paid in accordance with the
terms of this Agreement.
(c) The Servicer shall not, and any Successor Servicer shall not
be obligated to, use separate servicing procedures, offices, employees or
accounts for servicing the Receivables from the procedures, offices, employees
and accounts used by the Servicer or such Successor Servicer in connection with
servicing other wholesale receivables.
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(d) The Servicer shall comply with and perform its servicing
obligations with respect to the Financing Agreements relating to the Accounts
and the Financing Guidelines (except as otherwise provided in Section 3.1(a)),
except insofar as any failure to so comply or perform would not materially and
adversely affect the rights of the Trust or any of the Beneficiaries. Subject to
compliance with all Requirements of Law and subject to Section 3.1(a), the
Servicer (or DFS) may change the terms and provisions of the Wholesale Financing
Agreements, the Floorplan Agreements, the Accounts Receivable Financing
Agreements, the Asset Based Lending Financing Agreements or the Financing
Guidelines in any respect (including the calculation of the amount or the timing
of charge-offs and the rate of the finance charge assessed thereon), if, in the
reasonable judgment of the Servicer, no Early Amortization Event shall occur as
a result of such change.
SECTION 3.2. Servicing Compensation. As full compensation for its
servicing activities hereunder and reimbursement for its expenses as set forth
in the immediately following paragraph, the Servicer shall be entitled to
receive the Servicing Fee on each Distribution Date on or prior to the Trust
Termination Date payable in arrears. The "Servicing Fee" shall be the aggregate
of the Monthly Servicing Fees specified in the Supplements. The Servicing Fee
shall be payable to the Servicer solely to the extent amounts are available for
payment in accordance with the terms of the Supplements.
The Servicer's expenses include the amounts due to the Trustee
pursuant to Section 11.5 and the reasonable fees and disbursements of
independent accountants and all other expenses (including costs of collection
and legal fees) incurred by the Servicer in connection with its activities
hereunder, and including all other fees and expenses of the Trust not expressly
stated herein to be for the account of or payable by the Certificateholders, the
Seller or the Trust; provided that the Servicer shall not be responsible for
paying federal, state or local income or franchise taxes, if any, of the Seller,
the Trust or any Certificateholder. The Servicer shall be required to pay such
expenses for its own account, and shall not be entitled to any payment therefor
other than the Servicing Fee. The Servicer shall be solely responsible for all
fees and expenses incurred by or on behalf of the Servicer in connection
herewith and the Servicer shall not be entitled to any fee or other payment
from, or claim on, any of the Trust Assets (other than the Servicing Fee).
SECTION 3.3. Representations, Warranties and Covenants of the
Servicer. (a) DFS, as Servicer, hereby makes, and any Successor Servicer by its
appointment hereunder shall make, on each Closing Date (and on the date of any
such appointment) the following representations, warranties and covenants:
(i) Organization and Good Standing. Such party is a
corporation duly organized, validly existing and in good standing under
the applicable laws of the state of its incorporation and has, in all
material respects, full corporate power, authority and legal rights to own
its properties and conduct its wholesale receivable servicing business as
such properties are presently owned and as such business is presently
conducted, and to execute, deliver and perform its obligations under this
Agreement and the applicable Supplement.
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(ii) Due Qualification. Such party is duly qualified to do
business and is in good standing as a foreign corporation (or is exempt
from such requirements) and has obtained all necessary licenses and
approvals in each jurisdiction in which the servicing of the Receivables
as required by this Agreement requires such qualification except where the
failure to so qualify or obtain licenses or approvals would not have a
material adverse effect on its ability to perform its obligations
hereunder and under each Supplement.
(iii) Due Authorization. The execution, delivery, and
performance of this Agreement and the applicable Supplement has been duly
authorized by such party by all necessary corporate action on the part
thereof and are within its corporate powers.
(iv) Binding Obligation. This Agreement and each applicable
Supplement constitutes a legal, valid and binding obligation of such
party, enforceable in accordance with its terms, except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereinafter in effect, affecting
the enforcement of creditors' rights and except as such enforceability may
be limited by general principles of equity (whether considered in a
proceeding at law or in equity).
(v) No Violation. The execution and delivery of this
Agreement and the applicable Supplement by such party, the performance of
the transactions contemplated by this agreement and the applicable
Supplement and the fulfillment of the terms hereof and thereof applicable
to such party shall not conflict with or violate any Requirements of Law
applicable to such party or conflict with, violate, result in any breach
of any of the material terms and provisions of, or constitute (with or
without notice or lapse of time or both) a material default under any
indenture, contract, agreement, mortgage, deed of trust, or other
instrument to which such party is a party or by which it is bound.
(vi) No Proceedings. There are no proceedings or, to the best
knowledge of such party, investigations, pending or threatened against
such party before any court, regulatory body, administrative agency or
other tribunal or governmental instrumentality seeking to prevent the
issuance of the Certificates or the consummation of any of the
transactions contemplated by this Agreement and the applicable Supplement,
seeking any determination or ruling that, in the reasonable judgment of
such party, would materially and adversely affect the performance by such
party of its obligations under this Agreement and the applicable
Supplement, or seeking any determination or ruling that would materially
and adversely affect the validity or enforceability of this Agreement and
the applicable Supplement.
(vii) No Consents. No authorizations, consents, orders or
approvals of or notices to or registrations or declarations or filings
with any Governmental Authority are required to be obtained, effected or
given by the Servicer in connection with the due execution and delivery of
this Agreement and each Supplement by the Servicer and the performance of
the transactions contemplated by this Agreement and each Supplement by
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the Servicer, except for those that have been duly obtained, effected or
given and are in full force and effect.
(viii) Compliance with Requirements of Law. Such party shall
duly satisfy all obligations on its part to be fulfilled under or in
connection with the Receivables and the Accounts, shall maintain in effect
all qualifications required under Requirements of Law in order to service
properly the Receivables and the Accounts and shall comply in all material
respects with all Requirements of Law in connection with servicing the
Receivables and the Accounts the failure to comply with which would have a
material adverse effect on the interests of Beneficiaries.
(ix) No Rescission or Cancellation. Such party shall not
permit any rescission or cancellation of a Receivable except as ordered by
a court of competent jurisdiction or other Governmental Authority;
provided that this clause (ix) shall not prohibit a negotiated work-out of
defaulted Receivables that enhances the Trust's recovery in respect of
such Receivables.
(x) Protection of Beneficiaries Rights. Such party shall
take no action, nor omit to take any action, which would impair the rights
of Beneficiaries in the Receivables nor shall it reschedule, revise or
defer payments due on any Receivable except in accordance with the
Financing Guidelines (or other servicing standards required hereunder in
the case of a Successor Servicer).
(xi) Negative Pledge. Except for the conveyance hereunder to
the Trustee and the conveyances of Participation Interests permitted by
the Receivables Contribution and Sale Agreement, the Servicer shall not
sell, pledge, assign or transfer to any other Person, or grant, create,
incur, assume or suffer to exist any Lien on, any Receivable sold and
assigned to the Trust, whether now existing or hereafter created, or any
interest therein, and the Servicer shall defend the rights, title and
interest of the Trust in, to and under any Receivable sold and assigned to
the Trust, whether now existing or hereafter created, against all claims
of third parties claiming through or under the Seller or the Servicer.
(b) Notice of Breach. The representations and warranties set forth
in this Section 3.3 shall survive the transfer and assignment of the Receivables
to the Trust and the issuance of the Certificates. Upon discovery by the Seller,
the Servicer or a Responsible Officer of the Trustee of a breach of any of the
representations and warranties or covenants set forth in this Section 3.3, the
party discovering such breach shall give prompt written notice to the other
parties and to any Enhancement Providers.
(c) Purchase. In the event any covenant under Section
3.3(a)(viii), (ix) or (x) has not been complied with in any material respect
with respect to any Receivable or Account and such non-compliance has a material
adverse effect on the Certificateholders' Interest in such Receivable or
Account, then, within 30 days (or such longer period as may be agreed to by the
Trustee) of the earlier to occur of the discovery of any such event by the
Seller or the Servicer, or receipt by the Seller or the Servicer of written
notice of any such event given by the Trustee or any Enhancement Providers, the
Servicer shall purchase such Receivable or, in the case of non-
43
compliance with respect to an Account, all Receivables in such Account, on the
Determination Date immediately succeeding the expiration of such 30-day period
(or such longer period as may be agreed to by the Trustee) on the terms and
conditions set forth in the next succeeding paragraph; provided, however, that
no such purchase shall be required to be made with respect to such Receivable
if, by the end of such 30-day period (or such longer period as may be agreed to
by the Trustee) the non-compliance shall have been remedied in all material
respects and any material adverse effect caused thereby shall have been cured.
The Servicer shall effect such purchase by depositing in the Collection Account
in immediately available funds an amount equal to the Purchase Price of such
Receivable. Any such deposit of such Purchase Price into the Collection Account
shall be considered a Transfer Deposit Amount and shall be applied in accordance
with the terms of this Agreement.
Upon each such payment of such Purchase Price, the Trust shall
automatically and without further action be deemed to sell, transfer, assign,
set over and otherwise convey to the Servicer, without recourse, representation
or warranty (other than the representation that the Trustee has not sold,
transferred or assigned an interest in the Receivables), all right, title and
interest of the Trust in and to such Receivables, all monies due or to become
due with respect thereto and all proceeds thereof and the related Collateral
Security. The Trustee shall execute such documents and instruments of transfer
or assignment and take such other actions as shall be reasonably requested and
prepared by the Servicer to effect the conveyance of any such Receivables
pursuant to this Section. The obligation of the Servicer to purchase such
Receivables, and to make the deposits required to be made to the Collection
Account as provided in the preceding paragraph, shall constitute the sole remedy
respecting the event giving rise to such obligation available to
Certificateholders or the Trustee on behalf of Certificateholders.
SECTION 3.4. Reports and Records for the Trustee. On or before each
Distribution Date, with respect to each outstanding Series, the Servicer shall
deliver to any Enhancement Providers, the Rating Agencies, the Trustee and each
Investor Certificateholder a Distribution Date Statement for such Distribution
Date substantially in the form specified in the related Supplement.
SECTION 3.5. Annual Servicer's Certificate and Assertion. The
Servicer shall deliver to the Rating Agencies, the Trustee, any Agent and any
Enhancement Providers on or before March 31 of each calendar year,
(a) an Officer's Certificate substantially in the form of
Exhibit C stating that (i) a review of the activities of the
Servicer during the preceding calendar year (or part of the
preceding calendar year in the case of the first Officers'
Certificate) and of its performance under this Agreement was made
under the supervision of the officer signing such certificate and
(ii) to the best of such officer's knowledge, based on such review,
the Servicer has performed in all material respects its obligations
under this Agreement and each Supplement throughout such year (or
part of such year, as applicable), or, if there has been a material
default in the performance of any such obligation, specifying each
such default known to such officer and the nature and status
thereof, and
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(b) an assertion (made in accordance with generally accepted
auditing standards) addressed to a firm of nationally recognized
independent certified public accountants, who may also render other
services to the Servicer or to the Seller, stating that (i) the
Servicer is responsible for compliance with the servicing
requirements in Sections 3.1, 3.2, 3.3, 3.4, 3.5, 3.6 and 3.9 of
this Agreement and Article IV of this Agreement, and the applicable
provisions of the Supplements for the outstanding Series, and (ii)
based upon the evaluation of the Servicer's compliance with the
aforementioned sections of this Agreement and the applicable
provisions of the Supplements for the outstanding Series throughout
such year, the Servicer believes that it was in compliance with the
aforementioned sections of this Agreement and the applicable
provisions of the Supplements for the outstanding Series in all
material respects, or, if there has been a material default in the
performance of any such obligations, specifying such default known
to the Servicer and the nature and the status thereof.
SECTION 3.6. Annual Independent Public Accountants' Attestation and
Agreed Upon Procedures Report. (a) The Servicer shall cause a firm of nationally
recognized independent certified public accountants, who may also render other
services to the Servicer or to the Seller, to deliver to the Trustee, the Rating
Agencies, each Agent and each Enhancement Provider on or before March 31 of each
year, a report addressed to the Servicer and the Trustee, to the effect that
they have examined the assertion prepared by the Servicer on the Servicer's
compliance with the servicing requirements in Sections 3.1, 3.2, 3.3, 3.4, 3.5,
3.6 and 3.9 of this Agreement and Article IV of this Agreement, and the
applicable provisions of the Supplements for the outstanding Series, and that
based upon examination of such assertion, the Servicer was in compliance with
this Agreement and the applicable provisions of the Supplements for the
outstanding Series throughout such year (or part of such year, as applicable),
in all material respects, or, if there has been a material default in the
performance of any such obligations, specifying such default of the Servicer and
the nature thereof.
(b) On or before March 31 of each calendar year, the Servicer
shall cause a firm of nationally recognized independent public accountants (who
may also render other services to the Servicer or Seller) to furnish a report
(addressed to the Trustee) to the Trustee, each Agent, the Servicer, each Rating
Agency and each Enhancement Provider to the effect that they have performed
certain agreed upon procedures (and which reports the results of those
procedures), which were agreed to by the Servicer, solely to assist in
evaluating the Servicer's assertion as to the Servicer's compliance with the
servicing requirements in Sections 3.1, 3.2, 3.3, 3.4, 3.5, 3.6 and 3.9 of this
Agreement and Article IV of this Agreement, and the applicable provisions of the
Supplements for the outstanding Series.
(c) A copy of each statement, certificate, assertion or report
provided pursuant to Section 3.4, 3.5 or 3.6 may be obtained by any Investor
Certificateholder or Certificate Owner by a request to the Trustee addressed to
the Corporate Trust Office.
SECTION 3.7. Tax Treatment. The Seller has entered into this
Agreement and the Investor Certificates have been (or shall be) issued with the
intention that the Investor Certificates shall qualify as indebtedness secured
by the Receivables for Federal income taxes, state and local income and
franchise taxes (if such franchise taxes are imposed on or measured
45
by income) and any other taxes imposed on or measured by income. The Seller, the
Servicer, each Beneficiary and each Certificateholder and Certificate Owner, by
the acceptance of its Certificate or Book-Entry Certificate or an interest in a
Certificate or a Book-Entry Certificate, as applicable, agrees to treat the
Investor Certificates as indebtedness secured by the Receivables for Federal
income taxes, state and local income and franchise taxes (if such franchise
taxes are imposed on or measured by income) and any other taxes imposed on or
measured by income.
SECTION 3.8. Notices to DFS. In the event DFS is no longer acting as
Servicer, any Successor Servicer appointed pursuant to Section 10.2 shall
deliver or make available to DFS, as the case may be, each certificate and
report required to be prepared, forwarded or delivered thereafter pursuant to
Sections 3.4, 3.5 or 3.6.
SECTION 3.9. Adjustments. (a) If the Servicer adjusts downward the
amount of any Principal Receivable because of a rebate, refund, credit
adjustment or billing error to a Dealer, or because such Receivable was created
in respect of a Product which was refused or returned by a Dealer, then, in any
such case, the Seller's Participation Amount shall be automatically reduced by
the amount of the adjustment. Furthermore, if following such a reduction the
Pool Balance would be less than the Required Participation Amount on the
immediately preceding Determination Date (after giving effect to the
allocations, distributions, withdrawals and deposits to be made on the
Distribution Date immediately following such Determination Date), then the
Seller shall be required to pay an amount equal to such deficiency (up to the
amount of such adjustment) into the Collection Account on the day on which such
reduction occurs (each such payment an "Adjustment Payment").
(b) If (i) the Servicer makes a deposit into the Collection
Account in respect of a Collection of a Receivable and such Collection was
received by the Servicer in the form of a check which is not honored for any
reason or (ii) the Servicer makes a mistake with respect to the amount of any
Collection and deposits an amount that is less than or more than the actual
amount of such Collection, the Servicer shall appropriately adjust the amount
subsequently deposited into the Collection Account to reflect such dishonored
check or mistake. Any Receivable in respect of which a dishonored check is
received shall be deemed not to have been paid.
ARTICLE IV
Rights of Holders and
Allocation and Application of Collections
SECTION 4.1. Rights of Holders. The Investor Certificates shall
represent fractional undivided interests in the Trust, which, with respect to
each Series, shall consist of the right to receive pari passu, to the extent
necessary to make the required payments with respect to the Investor
Certificates of such Series at the times and in the amounts specified in the
related Supplement, the portion of Collections allocable to Investor
Certificateholders of such Series pursuant to this Agreement and such
Supplement, funds on deposit in the Collection Account allocable to
Certificateholders of such Series pursuant to this Agreement and such
Supplement, funds on deposit in any related Series Account and funds available
pursuant to any related Enhancement (collectively, with respect to all Series,
the "Certificateholders' Interest");
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provided that the Investor Certificates of any Series or Class shall not
represent any interest in any Series Account or Enhancement for the benefit of
any other Series or Class; provided, further, that allocations to a Series other
than the Dealer Overconcentration Series are subject to allocations to the
Dealer Overconcentration Series. The Seller's Certificate shall represent a
fractional undivided interest in the Trust, which shall consist of the right to
receive Collections with respect to the Receivables and other amounts at the
times and in the amounts specified in this Agreement or in any Supplement to be
paid to the Seller on behalf of all holders of the Seller's Certificates (the
"Seller's Interest"), and shall evidence the interest in the Trust not allocated
to the Certificateholders' Interest; provided, however, that the Seller's
Certificates shall not represent any interest in the Collection Account, any
Series Account or any Enhancement, except as specifically provided in this
Agreement or any Supplement.
SECTION 4.2. Establishment of the Collection Account. The Trustee
has established and maintained, and shall continue to maintain, in the name of
the Trust an Eligible Deposit Account bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Certificateholders and the other Beneficiaries (the "Collection Account"). The
Trustee shall possess all right, title and interest in all funds from time to
time on deposit in, and all Eligible Investments credited to, the Collection
Account and in all proceeds thereof. The Collection Account shall be under the
sole dominion and control of the Trustee for the benefit of the
Certificateholders and the other Beneficiaries. If, at any time, the Collection
Account ceases to be an Eligible Deposit Account, the Servicer shall, within 10
days after such occurrence, establish a substitute Eligible Deposit Account as
the Collection Account, instruct the Trustee to transfer any cash and/or any
Eligible Investments to such new Collection Account and, from the date any such
substitute account is established, such account shall be the Collection Account.
Neither the Seller nor the Servicer, nor any Person claiming by, through or
under the Seller or Servicer, shall have any right, title or interest in, or any
right to withdraw any amount from, the Collection Account. Pursuant to the
authority granted to the Servicer in Section 3.1, the Servicer shall have the
power, revocable by the Trustee, to instruct the Trustee to make withdrawals and
payments from the Collection Account for the purposes of carrying out the
Servicer's or Trustee's duties specified in this Agreement.
All Eligible Investments shall be held by the Trustee for the
benefit of the Certificateholders and the other Beneficiaries. Funds on deposit
in the Collection Account shall at the direction of the Servicer be invested by
the Trustee solely in Eligible Investments that shall mature so that such funds
shall be available by the close of business on the Business Day preceding the
next Distribution Date (or on or before 10:00 a.m. on such next Distribution
Date in the case of Eligible Investments in respect of which the Trustee is the
obligor). Any request by the Servicer to invest funds in the Collection Account
shall be in writing and shall certify that the requested investment is an
Eligible Investment that matures at or prior to the time required hereby. As of
each Determination Date, all interest and other investment earnings (net of
losses and investment expenses) on funds on deposit in the Collection Account
received on such Determination Date shall be credited to the Collection Account.
Schedule 2, which is hereby incorporated into and made part of this Agreement,
identifies the Collection Account by setting forth the account number of such
account, the account designation of such account and the name of the Eligible
Institution with which such account has been established. If a substitute
Collection Account is established pursuant to this Section 4.2, the Servicer
shall provide to the
47
Trustee an amended Schedule 2, setting forth the relevant information for such
substitute Collection Account.
SECTION 4.3. Allocations and Applications of Collections and Other
Funds. (a) Except as otherwise provided in Sections 4.3(b) and (c), the Servicer
shall deposit Collections into the Collection Account as promptly as possible
after the Date of Processing of such Collections, but in no event later than the
second Business Day after such Date of Processing.
(b) Notwithstanding anything in this Agreement to the contrary,
for so long as (i) DFS remains the Servicer hereunder, (ii) no Servicer Default
has occurred and is continuing and (iii) (x) DFS arranges for and maintains a
letter of credit or other form of Enhancement in respect of the Servicer's
obligations to make deposits of collections on the Receivables in the Collection
Account that is acceptable in form and substance to each Rating Agency and any
Agents or (y) DFS otherwise obtains the Rating Agency confirmations described
below, then, subject to any limitations in the confirmations described below,
the Servicer need not make the daily deposits of Collections into the Collection
Account as provided in Section 4.3(a), but may make a single deposit into the
Collection Account in same-day funds not later than 12:00 noon, New York City
time, on the Business Day immediately preceding the Distribution Date in a net
amount equal to the amount which would have been on deposit with respect to the
immediately preceding Collection Period in the Collection Account; provided,
however, that prior to ceasing daily deposits as described above the Seller
shall have delivered to the Trustee written confirmation from each of the Rating
Agencies that the failure by DFS to make daily deposits shall not result in a
reduction or withdrawal of the rating of any outstanding Series or Class.
(c) Subject to Section 4.4, but notwithstanding anything else in
this Agreement to the contrary, with respect to any Collection Period, whether
the Servicer is required to make deposits of Collections pursuant to paragraph
(a) or (b) above, (i) the Servicer shall only be required to deposit Collections
into the Collection Account up to the aggregate amount of Collections required
to be deposited into all Series Accounts or, without duplication, distributed on
the related Distribution Date to all Investor Certificateholders, to each Agent
or to each Enhancement Provider pursuant to the terms of any Supplement or
Enhancement Agreement and (ii) if at any time prior to such Distribution Date
the amount of Collections deposited in the Collection Account exceeds the amount
required to be deposited pursuant to clause (i) above, the Servicer shall be
permitted to withdraw the excess from the Collection Account.
The Servicer may make any deposits, distributions or payments under
this Agreement or a Supplement net of any amounts to be distributed or paid to
the Servicer under this Agreement or a Supplement; provided that the Servicer
shall account for such deposits, distributions and payments as if such amounts
were deposited, distributed or paid separately without such netting. The
Servicer shall net the portion of its Monthly Servicing Fee allocated to a
particular Series for a Distribution Date only if amounts deposited in the
Collection Account for that Distribution Date otherwise would be sufficient to
pay the amounts that are payable to that Series on such Distribution Date.
(d) Subject to Section 4.5, collections of Non-Principal
Receivables and Principal Receivables, Defaulted Amounts and Miscellaneous
Payments shall be allocated to
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each Series from and after the related Series Cut-Off Date as specified in the
related Supplement, and amounts so allocated to any Series shall not, except as
specified in the related Supplement, be available to the Investor
Certificateholders of any other Series. Allocations thereof between the
Certificateholders' Interest and the Seller's Interest, among the Series in any
group and among the Classes in any Series shall be set forth in the related
Supplement or Supplements.
(e) With respect to a receivable in which a Receivable and a
Participation Interest are undivided interests, the Servicer shall instruct the
Trustee in writing to distribute (and the Trustee shall distribute) the portion
of a collection allocable to such Participation Interest from the Collection
Account (to the extent it has been deposited into the Collection Account) to the
Servicer not later than one month after the deposit of such portion into the
Collection Account.
SECTION 4.4. Unallocated Principal Collections. On each Distribution
Date, (a) the Servicer shall allocate Excess Principal Collections (as described
below) to each Series as set forth in the related Supplement and (b) the
Servicer shall instruct the Trustee in the Distribution Date Statement for such
Distribution Date to withdraw from the Collection Account and pay to the Seller
(i) an amount equal to the excess, if any, of (x) the aggregate amount, if any,
for all outstanding Series of Collections of Principal Receivables which the
related Supplements specify are to be treated as "Excess Principal Collections"
with respect to such Distribution Date, over (y) the aggregate amount, if any,
for all outstanding Series which the related Supplements specify are "Principal
Shortfalls" with respect to such Distribution Date and, without duplication,
(ii) the aggregate amount for all outstanding Series of that portion of
Principal Collections which the related Supplements specify are to be allocated
and paid to the Seller with respect to such Distribution Date; provided,
however, that, in the case of clauses (i) and (ii), such amounts shall be paid
to the Seller only if the Unconcentrated Pool Balance for such Distribution Date
(determined after giving effect to any Principal Receivables transferred to the
Trust on such date) exceeds the Required Participation Amount for the
immediately preceding Determination Date (after giving effect to the
allocations, distributions, withdrawals and deposits to be made on such
Distribution Date). The amount held in the Collection Account as a result of the
proviso in the preceding sentence ("Unallocated Principal Collections") shall be
paid to the Seller at the time the Unconcentrated Pool Balance exceeds the
Required Participation Amount for the immediately preceding Determination Date
(after giving effect to the allocations, distributions, withdrawals and deposits
to be made on the Distribution Date immediately following such Determination
Date); provided, however, that any Unallocated Principal Collections on deposit
in the Collection Account at any time during which any Series is in its
amortization period, accumulation period or Early Amortization Period shall be
deemed to be "Miscellaneous Payments" and shall be allocated and distributed in
accordance with Sections 4.3 and 4.5 and the terms of each Supplement.
SECTION 4.5. Allocations to the Dealer Overconcentration Series. (a)
On each Determination Date, the Servicer shall determine whether a Dealer
Overconcentration exists with respect to any Dealer, and, if any Dealer
Overconcentration does exist, shall calculate the Overconcentration Percentage
for each Overconcentrated Dealer. For so long as a Dealer Overconcentration
exists, Principal Collections, Non-Principal Collections, Defaulted Amounts and
Miscellaneous Payments related to an Overconcentrated Dealer shall be allocated
in accordance with paragraph (b) of this Section.
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(b) Notwithstanding any other provision of this Agreement, (a) the
Overconcentration Percentage of (i) all Principal Collections relating to each
Overconcentrated Dealer, (ii) all Non-Principal Collections relating to each
Overconcentrated Dealer, and (iii) all Defaulted Amounts and Miscellaneous
Payments relating to each Overconcentrated Dealer with respect to each
Collection Period shall be allocated to the Dealer Overconcentration Series, and
(b) the Unconcentrated Percentage of (i) all Principal Collections relating to
each Overconcentrated Dealer, (ii) all Non-Principal Collections relating to
each Overconcentrated Dealer, and (iii) all Defaulted Amounts and Miscellaneous
Payments relating to each Overconcentrated Dealer shall be allocated among the
Seller's Interest and the Certificateholders' Interest of the outstanding Series
(other than the Dealer Overconcentration Series).
ARTICLE V
Distributions and Reports to
Certificateholders
Distributions shall be made to, and reports shall be provided to,
Certificateholders as set forth in the applicable Supplement.
ARTICLE VI
The Certificates
SECTION 6.1. The Certificates. The Investor Certificates of any
Series or Class may be issued (a) in fully registered form ("Registered
Certificates") and shall be substantially in the form of the exhibits with
respect thereto attached to the applicable Supplement, or (b) in uncertificated
form. The Deutsche FRLP Certificate was issued to the Seller in registered form.
If specified in any Supplement, the Investor Certificates of any Series or Class
shall be issued upon initial issuance as a single certificate evidencing the
aggregate original principal amount of such Series or Class as described in
Section 6.11. The Deutsche FRLP Certificate shall be a single certificate and
shall initially represent the entire Seller's Interest. Each Certificate shall
be executed by manual or facsimile signature on behalf of the Seller by its
President or any Vice President. Certificates bearing the manual or facsimile
signature of the individual who was, at the time when such signature was
affixed, authorized to sign on behalf of the Seller shall not be rendered
invalid, notwithstanding that such individual ceased to be so authorized prior
to the authentication and delivery of such Certificates or does not hold such
office at the date of such Certificates. No Certificates shall be entitled to
any benefit under this Agreement, or be valid for any purpose, unless there
appears on such Certificate a certificate of authentication substantially in the
form provided for herein executed by or on behalf of the Trustee by the manual
signature of a duly authorized signatory, and such certificate upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated and delivered hereunder. All Registered
Certificates and Seller's Certificates shall be dated the date of their
authentication.
SECTION 6.2. Authentication of Certificates. The Trustee shall
authenticate and deliver the Investor Certificates of each Series and Class that
are issued upon original issuance to
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or upon the order of the Seller, which order may be given under normal or
facsimile signature. The Trustee authenticated and delivered the Deutsche FRLP
Certificate to the Seller simultaneously with its delivery of the Investor
Certificates of the first Series issued hereunder. If specified in the related
Supplement for any Series or Class, the Trustee shall authenticate and deliver
outside the United States the Global Certificate that is issued upon original
issuance thereof.
SECTION 6.3. New Issuances. (a) The Seller may from time to time
direct the Trustee, on behalf of the Trust, to issue one or more new Series
pursuant to a Supplement. The Investor Certificates of all outstanding Series
shall be equally and ratably entitled as provided herein to the benefits of this
Agreement without preference, priority or distinction, all in accordance with
the terms and provisions of this Agreement and the applicable Supplement except,
with respect to any Series or Class, as provided in the related Supplement.
(b) On or before the Series Issuance Date relating to any new
Series, the parties hereto shall execute and deliver a Supplement which shall
specify the Principal Terms of such new Series. The terms of such Supplement may
modify or amend the terms of this Agreement solely as applied to such new
Series. The obligation of the Trustee to issue the Investor Certificates of such
new Series on the related Closing Date and to execute and deliver the related
Supplement is subject to the satisfaction of the following conditions:
(i) on or before the fifth Business Day immediately
preceding the Series Issuance Date (or in the case of the Dealer
Overconcentration Series or the Series designated as "Series 2000-1" or
"Series 2000-2", on or before the Series Issuance Date of such Series),
the Seller shall have given the Trustee, the Servicer, each Rating Agency,
any Agent and any Enhancement Provider written notice of such issuance and
the anticipated date on which such Series will be issued;
(ii) the Seller shall have delivered to the Trustee the
related Supplement, in form satisfactory to the Trustee, executed by each
party hereto other than the Trustee;
(iii) the Seller shall have delivered to the Trustee any
related Enhancement Agreement executed by each of the parties thereto,
other than the Trustee;
(iv) the Rating Agency Condition, if applicable, shall have
been satisfied with respect to such issuance;
(v) such issuance shall not result in the occurrence of an
Early Amortization Event and the Seller shall have delivered to the
Trustee, any Agent and any Enhancement Provider a certificate of a Vice
President or more senior officer, dated the Series Issuance Date, to the
effect that the Seller reasonably believes that such issuance shall not
result in the occurrence of an Early Amortization Event and is not
reasonably expected to result in the occurrence of an Early Amortization
Event at any time in the future;
(vi) the Seller shall have delivered to the Trustee and any
Enhancement Provider a Tax Opinion, dated the Series Issuance Date, with
respect to such issuance;
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(vii) the result obtained by multiplying (x) the Seller's
Participation Amount by (y) the percentage equivalent of the portion of
the Seller's Interest represented by the Deutsche FRLP Certificate, shall
not be less than 2% of the Pool Balance, in each case as of the Series
Issuance Date, and after giving effect to such issuance;
(viii) if there are any Delayed Funding Receivables in the
Pool Balance, the conditions in clauses (v) and (vii) shall also be
satisfied after excluding from the Pool Balance all Principal Receivables
that are Delayed Funding Receivables; and
(ix) the Seller shall have delivered to the Trustee an
Officer's Certificate to the effect that the conditions precedent in this
Section 6.3(b) have been satisfied; and
Upon satisfaction of the above conditions, the Trustee shall execute the
Supplement and issue to the Seller the Investor Certificates, if any, of such
Series for execution and redelivery to the Trustee for authentication.
(c) The Seller may surrender the Deutsche FRLP Certificate to the
Trustee in exchange for a newly issued Deutsche FRLP Certificate and a second
certificate (a "Supplemental Certificate"), the terms of which shall be defined
in a supplement to this Agreement (which Supplement shall be subject to Section
13.1 hereof to the extent that it amends any of the terms of this Agreement), to
be delivered to or upon the order of the Seller (or the holder of a Supplemental
Certificate, in the case of the transfer or exchange thereof, as provided
below), upon satisfaction of the following conditions:
(i) the result obtained by multiplying (x) the Seller's
Participation Amount (determined in accordance with Section 2.5(a)) by (y)
the percentage equivalent of the portion of the Seller's Interest
represented by the Deutsche FRLP Certificate, shall not be less than 2% of
the Pool Balance (determined in accordance with Section 2.5(a)), in each
case as of the date of, and after giving effect to, such exchange;
(ii) the Rating Agency Condition shall have been satisfied
with respect to such exchange (or transfer or exchange as provided below);
(iii) the Seller shall have delivered to the Trustee, any
Agent and any Enhancement Provider a Tax Opinion, dated the date of such
exchange (or transfer or exchange as provided below), with respect to such
transfer and exchange; and
(iv) the Seller shall have delivered to the Trustee an
Officer's Certificate to the effect that the conditions precedent in this
Section 6.3(c) shall have been satisfied.
The Deutsche FRLP Certificate shall at all times be beneficially owned by the
Seller. Any Supplemental Certificate may be transferred or exchanged only upon
satisfaction of the conditions set forth in clauses (ii) and (iii) above.
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(d) Notwithstanding anything to the contrary in this Agreement,
any Series may be issued in uncertificated form, i.e., without being evidenced
by a certificate of any kind. This is in addition to, and is not the same as,
the fact that certificates of a Series may be issued as Book-Entry Certificates.
All references in this Agreement or a Supplement (x) to a Series shall be deemed
to refer also to an uncertificated Series, and (y) to Certificateholders of a
Series shall be deemed to refer also to the holder or holders of an
uncertificated Series.
SECTION 6.4. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at the office or agency to be maintained
in accordance with the provisions of Section 11.15 a register (the "Certificate
Register") in which, subject to such reasonable regulations as it may prescribe,
a transfer agent and registrar (the "Transfer Agent and Registrar") shall
provide for the registration of the Registered Certificates and the Dealer
Overconcentration Series, and of transfers and exchanges of the Registered
Certificates and the Dealer Overconcentration Series, as herein provided. The
Transfer Agent and Registrar shall initially be the Trustee and any co-transfer
agent and co-registrar chosen by the Seller and acceptable to the Trustee. Any
reference in this Agreement to the Transfer Agent and Registrar shall include
any co-transfer agent and co-registrar unless the context requires otherwise.
Subject to paragraph (c) below, upon surrender for registration of
transfer of any Registered Certificate at any office or agency of the Transfer
Agent and Registrar maintained for such purpose, one or more new Registered
Certificates (of the same Series and Class) in authorized denominations shall be
executed, authenticated and delivered, in the name of the designated transferee
or transferees.
At the option of a Registered Certificateholder, Registered
Certificates (of the same Series and Class) may be exchanged for other
Registered Certificates of authorized denominations upon surrender of the
Registered Certificates to be exchanged at any such office or agency.
The preceding provisions of this Section notwithstanding, the
Trustee or the Transfer Agent and Registrar, as the case may be, shall not be
required to register the transfer of or exchange any Certificate for a period of
15 days preceding the due date for any payment with respect to the Certificate.
Whenever any Investor Certificates are so surrendered for exchange,
the Seller shall execute, the Trustee shall authenticate, and the Transfer Agent
and Registrar shall deliver the Investor Certificates which the Investor
Certificateholder making the exchange is entitled to receive. Every Investor
Certificate presented or surrendered for registration of transfer or exchange
shall be accompanied by a written instrument of transfer in a form satisfactory
to the Trustee or the Transfer Agent and Registrar duly executed by the Investor
Certificateholder or the attorney-in-fact thereof duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Investor Certificates or the Dealer Overconcentration Series, but
the Transfer Agent and Registrar may require payment of a sum sufficient to
cover any tax or governmental charge that may be imposed in connection with any
such transfer or exchange.
53
All Investor Certificates surrendered for registration of transfer
and exchange or for payment shall be canceled and disposed of in a manner
satisfactory to the Trustee. The Trustee shall cancel and destroy any Global
Certificate upon its exchange in full for Definitive Euro-Certificates and shall
deliver a certificate of destruction to the Seller. Such certificate shall also
state that a certificate or certificates of a Foreign Clearing Agency to the
effect referred to in Section 6.11 was received with respect to each portion of
the Global Certificate exchanged for Definitive Euro-Certificates.
The Seller shall execute and deliver to the Trustee Registered
Certificates in such amounts and at such times as are necessary to enable the
Trustee to fulfill its responsibilities under this Agreement and the
Certificates.
(b) The Transfer Agent and Registrar shall maintain at its expense
in the Borough of Manhattan, The City of New York, an office or agency where
Investor Certificates may be surrendered for registration of transfer or
exchange.
(c) (i) Registration of transfer of Investor Certificates
containing a legend to the effect set forth on Exhibit D-1 shall be effected
only if such transfer is made pursuant to an effective registration statement
under the Act, or is exempt from the registration requirements under the Act. In
the event that registration of a transfer is to be made in reliance upon an
exemption from the registration requirements under the Act, the transferor or
the transferee shall deliver, at its expense, to the Seller, the Servicer and
the Trustee, an investment letter from the transferee, substantially in the form
attached to the applicable Supplement, and no registration of transfer shall be
made until such letter is so delivered.
Investor Certificates issued upon registration or transfer of, or
Investor Certificates issued in exchange for, Investor Certificates bearing the
legend referred to above shall also bear such legend unless the Seller, the
Servicer, the Trustee and the Transfer Agent and Registrar receive an opinion of
counsel, satisfactory to each of them, to the effect that such legend may be
removed.
Whenever an Investor Certificate containing the legend referred to
above is presented to the Transfer Agent and Registrar for registration of
transfer, the Transfer Agent and Registrar shall promptly seek instructions from
the Servicer regarding such transfer and shall be entitled to receive and
conclusively rely upon instructions signed by a Servicing Officer prior to
registering any such transfer. The Seller hereby agrees to indemnify the
Transfer Agent and Registrar and the Trustee and to hold each of them harmless
against any loss, liability or expense incurred without negligence or bad faith
on their part arising out of or in connection with actions taken or omitted by
them in relation to any such instructions furnished pursuant to this clause (i).
(ii) Registration of transfer of Investor Certificates
containing a legend to the effect set forth on Exhibit D-2 shall be
effected only if such transfer is made to a Person which is not an
employee benefit plan, trust or account, including an individual
retirement account, that is subject to ERISA or that is described in
Section 4975(e)(1) of the Code or an entity whose underlying assets
include plan assets by reason of a plan's investment in such entity (a
"Benefit Plan"). By accepting and holding any such Investor Certificate,
an Investor Certificateholder shall be deemed to have represented and
54
warranted that it is not a Benefit Plan. With respect to any such
Certificate that is a Book-Entry Certificate, by acquiring any interest in
such Book-Entry Certificate a Certificate Owner shall be deemed to have
represented and warranted that it is not a Benefit Plan.
SECTION 6.5. Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate is surrendered to the Transfer Agent and
Registrar, or the Transfer Agent and Registrar receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate and (b) there
is delivered to the Transfer Agent and Registrar and the Trustee such security
or indemnity as may be required by them to save each of them harmless, then, in
the absence of notice to the Trustee that such Certificate has been acquired by
a bona fide purchaser, the Seller shall execute, the Trustee shall authenticate
and the Transfer Agent and Registrar shall deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate
of like tenor and aggregate fractional undivided interest. In connection with
the issuance of any new Certificate under this Section, the Trustee or the
Transfer Agent and Registrar may require the payment by the Certificateholder of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee and Transfer Agent and Registrar) connected therewith.
Any duplicate Certificate issued pursuant to this Section shall constitute
complete and indefeasible evidence of ownership in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Certificate shall be found
at any time.
SECTION 6.6. Persons Deemed Owners. The Trustee, the Transfer Agent
and Registrar and any agent of any of them may prior to due presentation of a
Registered Certificate for registration of transfer, treat the Person or Persons
in whose name any Registered Certificate is registered as the owner of such
Registered Certificate for the purpose of receiving distributions pursuant to
the terms of the applicable Supplement and for all other purposes whatsoever;
and, in any such case, neither the Trustee, the Transfer Agent and Registrar nor
any agent of any of them shall be affected by any notice to the contrary.
Notwithstanding the foregoing, in determining whether the Holders of the
requisite Investor Certificates have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Certificates owned by the
Seller, the Servicer, any other holder of a Seller's Certificate or any
Affiliate thereof, shall be disregarded and deemed not to be outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Certificates which a Responsible Officer of the Trustee knows to be so owned
shall be so disregarded. Certificates so owned which have been pledged in good
faith shall not be disregarded and may be regarded as outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Certificates and that the pledgee is not the Seller, the
Servicer, any other holder of a Seller's Certificate or any Affiliate thereof.
SECTION 6.7. Access to List of Registered Certificateholders' Names
and Addresses. The Trustee shall furnish or cause to be furnished by the
Transfer Agent and Registrar to the Servicer, within five Business Days after
receipt by the Trustee of a request therefor, a list in such form as the
Servicer may reasonably require, of the names and addresses of the Registered
Certificateholders. If three or more holders of Investor Certificates (the
"Applicants") apply to the Trustee, and such application states that the
Applicants desire to
55
communicate with other Investor Certificateholders with respect to their rights
under this Agreement or any Supplement or under the Investor Certificates and is
accompanied by a copy of the communication which such Applicants propose to
transmit, then the Trustee, after having been indemnified to its reasonable
satisfaction by such Applicants for its costs and expenses, shall afford or
shall cause the Transfer Agent and Registrar to afford such Applicants access
during normal business hours to the most recent list of Registered
Certificateholders of such Series or all outstanding Series, as applicable, held
by the Trustee, within five Business Days after the receipt of such application.
Such list shall be as of a date no more than 45 days prior to the date of
receipt of such Applicants' request.
Every Registered Certificateholder, by receiving and holding a
Registered Certificate, agrees with the Trustee that neither the Trustee, the
Transfer Agent and Registrar, nor any of their respective agents, shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the Registered Certificateholders hereunder, regardless of the
sources from which such information was derived.
SECTION 6.8. Book-Entry Certificates. Unless otherwise specified in
the related Supplement for any Series or Class, the Investor Certificates, upon
original issuance, shall be issued in the form of one or more typewritten
Investor Certificates representing the Book-Entry Certificates, to be delivered
to the Depository, by, or on behalf of, the Seller. The Investor Certificates
shall initially be registered on the Certificate Register in the name of the
Depository or its nominee, and no Certificate Owner shall receive a physical
certificate representing such Certificate Owner's interest in the Investor
Certificates, except as provided in Section 6.10. Unless and until certificated,
fully registered Investor Certificates ("Definitive Certificates") have been
issued to the applicable Certificate Owners pursuant to Section 6.10 or as
otherwise specified in any such Supplement:
(a) the provisions of this Section shall be in full force
and effect;
(b) the Seller, the Servicer and the Trustee may deal with
the Depository and the Depository Participants for all purposes
(including the making of distributions) as the authorized
representatives of the respective Certificate Owners;
(c) to the extent that the provisions of this Section
conflict with any other provisions of this Agreement, the provisions
of this Section shall control; and
(d) the rights of the respective Certificate Owners shall be
exercised only through the Depository and the Depository
Participants and shall be limited to those established by law and
agreements between such Certificate Owners and the Depository and/or
the Depository Participants. Pursuant to the Depository Agreement,
unless and until Definitive Certificates are issued pursuant to
Section 6.10, the Depository shall make book-entry transfers among
the Depository Participants and receive and transmit distributions
of principal and interest on the related Investor Certificates to
such Depository Participants.
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For purposes of any provision of this Agreement requiring or
permitting actions with the consent of, or at the direction of, Investor
Certificateholders evidencing a specified percentage of the aggregate unpaid
principal amount of Investor Certificates, such direction or consent may be
given by Certificate Owners (acting through the Depository and the Depository
Participants) owning Investor Certificates evidencing the requisite percentage
of principal amount of Investor Certificates.
SECTION 6.9. Notices to Depository. Whenever any notice or other
communication is required to be given to Investor Certificateholders of any
Series or Class with respect to which Book-Entry Certificates have been issued,
unless and until Definitive Certificates shall have been issued to the related
Certificate Owners, the Trustee shall give all such notices and communications
to the applicable Depository.
SECTION 6.10. Definitive Certificates. If Book-Entry Certificates
have been issued with respect to any Series or Class and (a) the Seller advises
the Trustee in writing that the Depository is no longer willing or able to
discharge properly its responsibilities under the Depository Agreement with
respect to such Series or Class, and the Trustee or the Seller is unable to
locate a qualified successor, (b) the Seller, at its option, advises the Trustee
in writing that it elects to terminate the book-entry system with respect to
such Series or Class through the Depository or (c) after the occurrence of a
Servicer Default, Certificate owners of such Series or Class evidencing more
than 50% of the aggregate unpaid principal amount of such Series or Class the
Certificates of which are registered in the name of DTC or its nominee advise
the Trustee in writing and the Depository through the Depository Participants
that the continuation of a book-entry system with respect to the Investor
Certificates of such Series or Class through the Depository is no longer in the
best interests of the Certificate Owners with respect to such Certificates, then
the Trustee shall notify all Certificate Owners of such Certificates, through
the Depository, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Trustee of any such Certificates by the Depository, accompanied
by registration instructions from the Depository for registration, the Trustee
shall authenticate and deliver such Definitive Certificates to such Certificate
Owners. Neither the Seller nor the Trustee shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of such Definitive
Certificates all references herein to obligations imposed upon or to be
performed by the Depository shall be deemed to be imposed upon and performed by
the Trustee, to the extent applicable with respect to such Definitive
Certificates and the Trustee shall recognize the Holders of such Definitive
Certificates as Investor Certificateholders hereunder.
SECTION 6.11. Global Certificate; Exchange Date. (a) If specified in
the related Supplement for any Series or Class, the Investor Certificates shall
initially be issued in the form of a single temporary global Certificate (the
"Global Certificate") in bearer form, without interest coupons, in the
denomination of the entire aggregate principal amount of such Series or Class
and substantially in the form set forth in the exhibit with respect thereto
attached to the related Supplement. The Global Certificate shall be
authenticated by the Trustee upon the same conditions, in substantially the same
manner and with the same effect as the Definitive Certificates. The Global
Certificate may be exchanged as described below for Registered Certificates in
definitive form (the "Definitive Euro-Certificates").
57
(b) The Manager shall, upon its determination of the date of
completion of the distribution of the Investor Certificates of such Series or
Class, so advise the Trustee, the Seller, the Common Depositary, and each
Foreign Clearing Agency forthwith. A United States institutional investor may
exchange the portion of the Global Certificate beneficially owned by it only for
an equal aggregate principal amount of Registered Certificates bearing the
applicable legend set forth in the form of Registered Certificate attached to
the related Supplement and having a minimum denomination of $500,000, which may
be in temporary form if the Seller so elects. The Seller may waive the $500,000
minimum denomination requirement if it so elects, by delivery of an Officer's
Certificate to the Trustee to such effect. Upon any demand for exchange for
Definitive Euro-Certificates in accordance with this paragraph, the Seller shall
cause the Trustee to authenticate and deliver the Definitive Euro-Certificates
to the Holder and according to the instructions of the Holder, in the case of
Registered Certificates, but in either case only upon presentation to the
Trustee of a written statement substantially in the form of Exhibit F-1 with
respect to the Global Certificate or portion thereof being exchanged, signed by
a Foreign Clearing Agency and dated on the Exchange Date or a subsequent date,
to the effect that it has received in writing or by tested telex a certification
substantially in the form of (i) in the case of beneficial ownership of the
Global Certificate or a portion thereof being exchanged by a United States
institutional investor pursuant to the second preceding sentence, the
certificate in the form of Exhibit F-2 signed by the Manager which sold the
relevant Certificates or (ii) in all other cases, the certificate in the form of
Exhibit F-3, the certificate referred to in this clause (ii) being dated on the
earlier of the first actual payment of interest in respect of such Certificates
and the date of the delivery of such Certificate in definitive form. Upon
receipt of such certification, the Trustee shall cause the Global Certificate to
be endorsed in accordance with paragraph (d) below. Any exchange as provided in
this Section shall be made free of charge to the holders and the beneficial
owners of the Global Certificate and to the beneficial owners of the Definitive
Euro-Certificates issued in exchange, except that a Person receiving Definitive
Euro-Certificates must bear the cost of insurance, postage, transportation and
the like in the event that such Person does not receive such Definitive
Euro-Certificates in person at the offices of a Foreign Clearing Agency.
(c) The delivery to the Trustee by a Foreign Clearing Agency of
any written statement referred to above may be relied upon by the Seller and the
Trustee as conclusive evidence that a corresponding certification or
certifications has or have been delivered to such Foreign Clearing Agency
pursuant to the terms of this Agreement.
(d) Upon any such exchange of all or a portion of the Global
Certificate for a Definitive Euro-Certificate or Certificates, such Global
Certificate shall be endorsed by or on behalf of the Trustee to reflect the
reduction of its principal amount by an amount equal to the aggregate principal
amount of such Definitive Euro-Certificate or Certificates. Until so exchanged
in full, such Global Certificate shall in all respects be entitled to the same
benefits under this Agreement as Definitive Euro-Certificates authenticated and
delivered hereunder except that the beneficial owners of such Global Certificate
shall not be entitled to receive payments of interest on the Certificates until
they have exchanged their beneficial interests in such Global Certificate for
Definitive Euro-Certificates.
SECTION 6.12. Meetings of Certificateholders. (a) Notice of any
meeting of Investor Certificateholders, setting forth the time and place of such
meeting and in general terms
58
the action proposed to be taken at such meeting, shall be given in accordance
with Section 13.5, the first mailing and publication to be not less than 20 nor
more than 180 days prior to the date fixed for the meeting. To be entitled to
vote at any meeting of Investor Certificateholders a Person shall be (i) a
Holder of one or more Investor Certificates of the applicable Series or Class or
(ii) a Person appointed by an instrument in writing as proxy by the Holder of
one or more such Investor Certificates. The only Persons who shall be entitled
to be present or to speak at any meeting of Investor Certificateholders shall be
the Persons entitled to vote at such meeting and their counsel and any
representatives of the Seller, the Servicer and the Trustee and their respective
counsel.
(b) At a meeting of Investor Certificateholders, Persons entitled
to vote Investor Certificates evidencing a majority of the aggregate unpaid
principal amount of the applicable Series or Class or all outstanding Series, as
the case may be, shall constitute a quorum. No business shall be transacted in
the absence of a quorum, unless a quorum is present when the meeting is called
to order. In the absence of a quorum at any such meeting, the meeting may be
adjourned for a period of not less than 10 days; in the absence of a quorum at
any such adjourned meeting, such adjourned meeting may be further adjourned for
a period of not less than 10 days; at the reconvening of any meeting further
adjourned for lack of a quorum, the Persons entitled to vote Investor
Certificates evidencing at least 25% of the aggregate unpaid principal amount of
the applicable Series or Class or all outstanding Series, as the case may be,
shall constitute a quorum for the taking of any action set forth in the notice
of the original meeting. Notice of the reconvening of any adjourned meeting
shall be given as provided above except that such notice must be given not less
than five days prior to the date on which the meeting is scheduled to be
reconvened. Notice of the reconvening of an adjourned meeting shall state
expressly the percentage of the aggregate principal amount of the outstanding
applicable Investor Certificates which shall constitute a quorum.
(c) Any Investor Certificateholder who has executed an instrument
in writing appointing a person as proxy shall be deemed to be present for the
purposes of determining a quorum and be deemed to have voted; provided that such
Investor Certificateholder shall be considered as present or voting only with
respect to the matters covered by such instrument in writing. Subject to the
provisions of Section 13.1, any resolution passed or decision taken at any
meeting of Investor Certificateholders duly held in accordance with this Section
shall be binding on all Investor Certificateholders whether or not present or
represented at the meeting.
(d) The Trustee shall appoint a temporary chairman of the meeting.
A permanent chairman and a permanent secretary of the meeting shall be elected
by vote of the Holders of Investor Certificates evidencing a majority of the
aggregate unpaid principal amount of Investor Certificates of the applicable
Series or Class or all outstanding Series, as the case may be, represented at
the meeting. No vote shall be cast or counted at any meeting in respect of any
Investors Certificate challenged as not outstanding and ruled by the chairman of
the meeting to be not outstanding. The chairman of the meeting shall have no
right to vote except as an Investor Certificateholder or proxy. Any meeting of
Investor Certificateholders duly called at which a quorum is present may be
adjourned from time to time, and the meeting may be held as so adjourned without
further notice.
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(e) The vote upon any resolution submitted to any meeting of
Investor Certificateholders shall be by written ballot on which shall be
subscribed the signatures of Investor Certificateholders or proxies and on which
shall be inscribed the serial number or numbers of the Investor Certificates
held or represented by them. The permanent chairman of the meeting shall appoint
two inspectors of votes who shall count all votes cast at the meeting for or
against any resolution and who shall make and file with the secretary of the
meeting their verified written reports in duplicate of all votes cast at the
meeting. A record in duplicate of the proceedings of each meeting of Investor
Certificateholders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of votes
on any vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was published as provided above. The record shall be
signed and verified by the permanent chairman and secretary of the meeting and
one of the duplicates shall be delivered to the Servicer and the other to the
Trustee to be preserved by the Trustee, the latter to have attached thereto the
ballots voted at the meeting. Any record so signed and verified shall be
conclusive evidence of the matters therein stated.
ARTICLE VII
Other Matters Relating
to the Seller
SECTION 7.1. Liability of the Seller. The Seller shall be liable for
all obligations, covenants, representations and warranties of the Seller arising
under or related to this Agreement. Except as provided in the preceding
sentence, the Seller shall be liable only to the extent of the obligations
specifically undertaken by it in its capacity as Seller hereunder.
SECTION 7.2. Limitation on Liability of the Seller. Subject to
Sections 7.1, 7.3 and 7.4, neither the Seller, any of its partners, employees or
agents, nor any of the shareholders, directors, officers, employees or agents of
such partners in its capacity as Seller shall be under any liability to the
Trust, the Trustee, the Certificateholders or any other Person for any action
taken or for refraining from the taking of any action in the capacity as Seller
pursuant to this Agreement whether arising from express or implied duties under
this Agreement; provided, however, that this provision shall not protect the
Seller or any such Person against any liability which would otherwise be imposed
by reason of wilful misfeasance, bad faith or gross negligence in the
performance of duties or by reason of reckless disregard of obligations and
duties hereunder. The Seller and any of its partners and any director or officer
or employee or agent of the Seller or any of its partners may rely in good faith
on any document of any kind prima facie properly executed and submitted by any
Person respecting any matters arising hereunder.
SECTION 7.3. Seller Indemnification of the Trust and the Trustee.
The Seller shall indemnify and hold harmless the Trust, for the benefit of the
Certificateholders and the other Beneficiaries, and the Trustee, from and
against any loss, liability, expense, damage or injury suffered or sustained by
reason of any acts, omissions or alleged acts or omissions arising out of
activities of the Trust or the Trustee pursuant to this Agreement, including any
judgment, award, settlement, reasonable attorneys' fees and other costs or
expenses incurred in connection
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with the defense of any actual or threatened action, proceeding or claim;
provided, however, that the Seller shall not indemnify the Trust or the Trustee
if such acts, omissions or alleged acts or omissions constitute fraud, gross
negligence, breach of fiduciary duty or wilful misconduct by the Trustee; and
provided further that the Seller shall not indemnify the Trust, Trustee or the
Certificateholders or any other Beneficiaries for any liabilities, cost or
expense of the Trust with respect to any action taken by the Trustee at the
request of any Certificateholders or other Beneficiaries to the extent the
Trustee is fully indemnified by such Certificateholders or other Beneficiaries
with respect to such action and such action is inconsistent with their rights
hereunder or with respect to any Federal, state or local income or franchise
taxes (or any interest or penalties with respect thereto) required to be paid by
the Trust or any Certificateholder or other Beneficiary in connection herewith
to any taxing authority. Subject to Section 7.1, any indemnification pursuant to
this Section shall only be from (i) the excess of the Seller's Interest for any
date of determination over the Required Participation Amount as of such date and
(ii) any other assets of the Seller not pledged to third parties or otherwise
encumbered in a manner permitted by the Seller's agreement of limited
partnership and shall only be made after payment in full of any amounts that the
Seller is obligated to deposit in the Collection Account pursuant to this
Agreement. Any indemnification under this Article VII shall survive the
resignation or removal of the Trustee and the termination of this Agreement.
SECTION 7.4. Liabilities. Notwithstanding anything to the contrary
in this Agreement, the Seller by entering into this Agreement, and any holder of
any interest in the Seller's Certificate by its acceptance thereof, agree to be
liable, directly to the injured party, for the entire amount of any losses,
claims, damages or liabilities (other than those incurred by an Investor
Certificateholder in its capacity as an Investor Certificateholder) arising out
of or based on the arrangement created by this Agreement or the actions of
Servicer taken pursuant hereto (to the extent Trust Assets remaining after the
Investor Certificateholders and Enhancement Providers, if any, have been paid in
full are insufficient to pay any such losses, claims, damages or liabilities) as
though this Agreement created a partnership under the Delaware Revised Uniform
Partnership Act in which Seller and such holder of the Seller's Certificate were
general partners.
ARTICLE VIII
Other Matters Relating to the Servicer
SECTION 8.1. Liability of the Servicer. The Servicer shall be liable
under this Article VIII only to the extent of the obligations specifically
undertaken by the Servicer in its capacity as Servicer.
SECTION 8.2. Merger or Consolidation of, or Assumption of, the
Obligations of the Servicer. The Servicer shall not consolidate with or merge
with any other Person or convey or transfer its properties and assets
substantially as an entirety to any Person, unless:
(a) the Person formed by such consolidation or with which
the Servicer is merged or the Person which acquires by conveyance or
transfer the properties and assets of the Servicer substantially as
an entirety shall be a Person organized and existing under the laws
of the United States of America or any
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ and, if the Servicer is not the
surviving entity, such Person shall assume, without the execution or
filing of any paper or any further act on the part of any of the
parties hereto, the performance of every covenant and obligation of
the Servicer hereunder, and upon compliance with paragraph (b) below
such Person shall be the Servicer; and
(b) the Servicer has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance or transfer comply with this
Section 8.2 and that all conditions provided for in paragraph (a)
relating to such transaction have been complied with.
Neither this Section 8.2 nor any other part of this Agreement shall
prevent or limit the sale or other transfer of shares of stock of DFS.
The Servicer (if DFS) shall notify the Rating Agencies promptly in
the event that DFS ceases to be a wholly-owned indirect subsidiary of Deutsche
Bank AG.
SECTION 8.3. Limitation on Liability of the Servicer and Others.
Except as provided in Sections 8.1 and 8.4, neither the Servicer nor any of the
directors or officers or employees or agents of the Servicer, shall be under any
liability to the Trust, the Trustee, the Certificateholders or any other Person
for any action taken or for refraining from the taking of any action in its
capacity as Servicer pursuant to this Agreement; provided, however, that this
provision shall not protect the Servicer or any such person against any
liability which would otherwise be imposed by reason of wilful misfeasance, bad
faith or negligence in the performance of duties or by reason of reckless
disregard of obligations and duties hereunder. The Servicer and any director or
officer or employee or agent of the Servicer may rely in good faith on any
document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Receivables in accordance with this
Agreement which in its reasonable opinion may involve it in any expense or
liability.
SECTION 8.4. Servicer Indemnification of the Trust and the Trustee.
The Servicer shall indemnify and hold harmless the Trust, for the benefit of the
Certificateholders and the other Beneficiaries, and the Trustee, from the
Servicer's own funds, from and against any loss, liability, expense, damage or
injury suffered or sustained by reason of any acts, omissions or alleged acts or
omissions arising out of activities of the Servicer, the Trust or the Trustee
pursuant to this Agreement, including any judgment, award, settlement,
reasonable attorneys' fees and other costs or expenses incurred in connection
with the defense of any actual or threatened action, proceeding or claim;
provided, however, that the Servicer shall not indemnify the Trust or the
Trustee if such acts, omissions or alleged acts or omissions constitute fraud,
gross negligence, breach of fiduciary duty or wilful misconduct by the Trustee;
and provided, further that the Servicer shall not indemnify the Trust, the
Trustee or the Certificateholders or the other Beneficiaries (i) for any
liabilities, cost or expense of the Trust with respect to any action taken by
the Trustee at the request of the Certificateholders or any other Beneficiaries
to the extent the Trustee is fully indemnified by such Certificateholders or
other Beneficiaries with
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respect to such action or (ii) with respect to any Federal, state or local
income or franchise taxes (or any interest or penalties with respect thereto)
required to be paid by the Trust or the Certificateholders or the other
Beneficiaries in connection herewith to any taxing authority or (iii) for any
loss due to the financial inability of any Dealer to make payments on or with
respect to any Receivable. Any indemnification under this Article VIII shall
survive the termination of this Agreement and the resignation and removal of the
Trustee.
SECTION 8.5. The Servicer Not to Resign. The Servicer shall not
resign from the obligations and duties hereby imposed on it except upon
determination that (a) the performance of its duties hereunder is no longer
permissible under applicable law and (b) there is no reasonable action which the
Servicer could take to make the performance of its duties hereunder permissible
under applicable law. Any such determination permitting the resignation of the
Servicer shall be evidenced as to clause (a) above by an Opinion of Counsel to
such effect delivered to the Trustee. No such resignation shall become effective
until the Trustee or a Successor Servicer shall have assumed the
responsibilities and obligations of the Servicer in accordance with Section 10.2
hereof. If the Trustee is unable within 120 days of the date of such
determination to appoint a Successor Servicer, the Trustee shall serve as
Successor Servicer hereunder.
SECTION 8.6. Access to Certain Documentation and Information
Regarding the Receivables. The Servicer shall provide to the Trustee access to
the documentation regarding the Accounts and the Receivables in such cases where
the Trustee is required in connection with the enforcement of the rights of the
Certificateholders, or by applicable statutes or regulations, to review such
documentation, such access being afforded without charge but only (a) upon
reasonable request, (b) during normal business hours, (c) subject to the
Servicer's normal security and confidentiality procedures and (d) at offices
designated by the Servicer. Nothing in this Section 8.6 shall derogate from the
obligation of the Seller, the Trustee or the Servicer to observe any applicable
law prohibiting disclosure of information regarding the Dealers and the failure
of the Servicer to provide access as provided in this Section 8.6 as a result of
such obligation shall not constitute a breach of this Section 8.6.
SECTION 8.7. Delegation of Duties. Subject to Section 3.1, in the
ordinary course of business, the Servicer may at any time delegate any duties
hereunder to any Person who agrees to conduct such duties in accordance with the
Financing Guidelines (or, in the case of a Successor Servicer, the servicing
standards required hereunder) and this Agreement. The Servicer shall give prompt
written notice of any such delegation of a material function to the Rating
Agencies, any Agent and any Enhancement Providers. Such delegation shall not
relieve the Servicer of its liability and responsibility with respect to such
duties, and shall not constitute a resignation within the meaning of Section 8.5
and the Rating Agency Condition shall have been satisfied with respect to such
delegation prior to such delegation.
SECTION 8.8. Examination of Records. The Seller and the Servicer
shall indicate generally in its computer files or other records that the
Receivables arising in the Accounts have been conveyed to the Trust pursuant to
this Agreement for the benefit of the Certificateholders and the other
Beneficiaries. The Seller and the Servicer shall, prior to the sale or transfer
to a third party of any receivable held in its custody, examine its computer and
other records to determine that such receivable is not a Receivable.
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SECTION 8.9. Custodial Arrangements. (a) The Servicer shall maintain
custody of all documents, instruments or records that evidence or relate to
Receivables as custodian for the benefit of the Trustee and the Investor
Certificateholders. The Trustee shall have no responsibility or liability for
any acts or omissions or any negligence or wilful misconduct of the Servicer as
such custodian.
(b) In performing its duties under this Section 8.9, the Servicer
agrees to act with that degree of skill and care that it exercises with respect
to similar documents, instruments or records that evidence or relate to
receivables owned or serviced by it.
ARTICLE IX
Early Amortization Events
SECTION 9.1. Early Amortization Events. If any one of the following
events shall occur:
(a) a failure by the Seller to convey Receivables in
Additional Accounts to the Trust within five Business Days after the
day on which it is required to convey such Receivables pursuant to
this Agreement; or
(b) any Specified Party shall file a petition commencing a
voluntary case under any chapter of the Federal bankruptcy laws; or
any Specified Party shall file a petition or answer or consent
seeking reorganization, arrangement, adjustment, or composition
under any other similar applicable Federal law, or shall consent to
the filing of any such petition, answer, or consent; or any
Specified Party shall appoint, or consent to the appointment of, a
custodian, receiver, liquidator, trustee, assignee, sequestrator or
other similar official in bankruptcy or insolvency or receivership
of it or of any substantial part of its property; or any Specified
Party shall make an assignment for the benefit of creditors, or
shall admit in writing its inability to pay its debts generally as
they become due; or
(c) any order for relief against any Specified Party shall
have been entered by a court having jurisdiction in the premises
under any chapter of the Federal bankruptcy laws, and such order
shall have continued undischarged or unstayed for a period of 60
days; or a decree or order by a court having jurisdiction in the
premises shall have been entered approving as properly filed a
petition seeking reorganization, arrangement, adjustment, or
composition of any Specified Party under any other similar
applicable Federal law, and such decree or order shall have
continued undischarged or unstayed for a period of 120 days; or a
decree or order of a court having jurisdiction in the premises for
the appointment of a custodian, receiver, liquidator, trustee,
assignee, sequestrator, or other similar official in bankruptcy or
insolvency or receivership of any Specified Party or of any
substantial part of its property or for the winding up or
liquidation of its affairs, shall have been entered, and such decree
or order shall have remained in force undischarged or unstayed for a
period of 120 days; or
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(d) failure on the part of the Seller, the Servicer or DFS,
as applicable, (i) to make any payment or deposit (including any
Transfer Deposit Amount or Adjustment Payment) required by the terms
of this Agreement or the Receivables Contribution and Sale Agreement
on or before the date occurring five Business Days after the date
such payment or deposit is required to be made, or (ii) with respect
to any Series, to deliver a Distribution Date Statement within ten
Business Days after notice from the Trustee of such failure to
deliver such Distribution Date Statement, or (iii) in the case of
the Seller duly to observe or perform in any material respect the
covenant of the Seller set forth in Section 2.6(a) with respect to a
Receivable, which failure, in the case of this clause (iii), has a
material adverse effect on the interests of the Holders of the
Investor Certificates and continues unremedied for a period of 60
days after the date on which notice of such failure, requiring the
same to be remedied, shall have been given to the Seller by the
Trustee or any Enhancement Provider; provided, however, that an
Early Amortization Event pursuant to this clause (iii) shall not be
deemed to have occurred if the Seller shall have repurchased the
related Receivables or, if applicable, all of the Receivables during
such period in accordance with the provisions of this Agreement; or
(iv) duly to observe or perform in any material respect any other
covenants or agreements of the Seller or the Servicer or DFS, as the
case may be, set forth in this Agreement or the Receivables
Contribution and Sale Agreement, which failure in the case of this
clause (iv) has a material adverse effect on the interests of the
Holders of the Investor Certificates and continues unremedied for a
period of 45 days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to
the Seller and the Servicer by the Trustee or to the Seller and the
Servicer and the Trustee by any Enhancement Provider; or
(e) any representation or warranty made by DFS in the
Receivables Contribution and Sale Agreement or the Seller in this
Agreement or any information contained in a computer file or
microfiche or written list required to be delivered by the Seller
pursuant to Section 2.1, 2.5, 2.7 or 2.8, (i) shall prove to have
been incorrect in any material respect when made or when delivered,
and shall continue to be incorrect in any material respect for a
period of 60 days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to
the Seller by the Trustee and (ii) as a result of such incorrectness
the interests of the Holders of the Investor Certificates are
materially and adversely affected (excluding, however, the
representation and warranty made by the Seller pursuant to Section
2.3(j) if this Agreement constitutes the grant of a perfected
security interest in the Receivables and the Collateral Security and
the proceeds thereof under the UCC as then in effect; provided,
however, that an Early Amortization Event shall not be deemed to
have occurred under this paragraph if the Seller has repurchased the
related Receivable or all such Receivables, if applicable, during
such period in accordance with the provisions of this Agreement; or
(f) the Trust or the Seller shall become an "investment
company" within the meaning of the Investment Company Act;
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then, subject to applicable law, and after the applicable grace
period, if any, an amortization event (an "Early Amortization
Event") shall occur without any notice or other action on the part
of the Trustee, any Agent, the Certificateholders or any other
Beneficiary, immediately upon the occurrence of such event.
SECTION 9.2. Additional Rights Upon the Occurrence of Certain
Events. (a) If an Insolvency Event occurs with respect to the Seller or the
Seller violates Section 2.6(a) for any reason, the Seller shall on the day such
Insolvency Event or violation occurs (the "Appointment Date") immediately cease
to transfer Receivables to the Trust and shall promptly give notice to the
Trustee of such Insolvency Event or violation and the Trust shall be deemed to
have terminated, subject to the liquidation, winding up and dissolution
procedures described below. Notwithstanding any cessation of the transfer to the
Trust of additional Receivables, Receivables transferred to the Trust prior to
the occurrence of such Insolvency Event or violation and Collections in respect
of such Receivables whenever created or accrued in respect of such Receivables,
shall continue to be a part of the Trust. Within 15 days of the date on which
the Trustee receives notice from the Seller of the Appointment Date, the Trustee
shall (i) publish a notice in an Authorized Newspaper that an Insolvency Event
or violation has occurred and that the Trustee intends to sell, dispose of or
otherwise liquidate the Receivables on commercially reasonable terms and in a
commercially reasonable manner and (ii) give notice to Investor
Certificateholders describing the provisions of this Section and requesting
instructions from such Holders. Unless the Trustee shall have received
instructions within 90 days from the date notice pursuant to clause (ii) above
is first given from (x) Holders of Investor Certificates evidencing more than
50% of the aggregate outstanding principal amount of each Series or, with
respect to any Series with two or more Classes, of each Class, to the effect
that such Investor Certificateholders disapprove of such sale, disposition or
liquidation of the Receivables and wish to continue having Receivables
transferred to the Trust as before such Insolvency Event or violation, and (y)
each Holder of a Supplemental Certificate to such effect, then the Trustee shall
promptly sell, dispose of or otherwise liquidate the Receivables, or cause to be
sold, disposed of or otherwise liquidated, in a commercially reasonable manner
and on commercially reasonable terms, which shall include the solicitation of
competitive bids, provided that if such sale, disposition or liquidation is
being made solely on account of the Seller's violation of Section 2.6(a), then
the Trustee shall effect such sale, disposition or liquidation, or cause such
sale, disposition or liquidation to be effected, only if the net proceeds of
such sale, disposition or liquidation, applied in accordance with Section
9.2(b), shall be sufficient to pay accrued and unpaid interest on each Series of
Certificates plus the excess of the outstanding principal balance of each Series
of Certificates over the unreimbursed investor charge-offs, if applicable, for
such Series. The Trustee may obtain and conclusively rely upon a prior
determination from any applicable conservator, receiver or liquidator that the
terms and manner of any proposed sale, disposition or liquidation are
commercially reasonable. The provisions of Sections 9.1 and 9.2 shall not be
deemed to be mutually exclusive.
(b) The proceeds from the sale, disposition or liquidation of the
Receivables pursuant to paragraph (a), net of all reasonable expenses incurred
by the Trustee in connection with such sale, liquidation or other disposition,
which shall be paid to the Trustee from such proceeds ("Insolvency Proceeds")
shall be immediately deposited in the Collection Account. The Trustee shall
determine conclusively the amount of the Insolvency Proceeds which are deemed to
be Non-Principal Receivables and Principal Receivables. The Insolvency Proceeds
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shall be allocated and distributed to Investor Certificateholders in accordance
with Article IV and the terms of each Supplement and the Trust shall terminate
immediately thereafter.
ARTICLE X
Servicer Defaults
SECTION 10.1. Servicer Defaults. If any one of the following events
(a "Servicer Default") shall occur and be continuing with respect to the
Servicer:
(a) any failure by the Servicer to make any payment, transfer or
deposit or to give instructions or to give notice to the Trustee to make any
payment, transfer or deposit or to take any action under any Enhancement
Agreement on or before the date such payment, transfer or deposit or such
instruction or notice is required to be made or given, as the case may be, under
the terms of this Agreement, which failure is not cured within five Business
Days after notice of such failure from the Trustee to the Servicer;
(b) failure on the part of the Servicer duly to observe or perform
its covenant not to create any Lien on any Receivable which failure has a
material adverse effect on the Certificateholders and which continues unremedied
for a period of sixty (60) days after written notice to it of such failure;
provided, however, that a "Servicer Default" shall not be deemed to have
occurred if the Seller or the Servicer shall have repurchased the related
Receivables or, if applicable, all of the Receivables during such period in
accordance with the provisions of this Agreement;
(c) failure on the part of the Servicer duly to observe or perform
any covenants or agreements of the Servicer set forth in this Agreement (other
than with respect to those specified in clause (a) or (b) above and with respect
to clauses (viii), (ix) and (x) under Section 3.3(a) hereof, to the extent the
terms of Section 3.3(c) hereof have been complied with) which failure has a
material adverse effect on the Certificateholders and which continues unremedied
for a period of thirty (30) days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Trustee;
(d) any representation, warranty or certification made by the
Servicer in this Agreement or in any certificate delivered pursuant to this
Agreement shall prove to have been incorrect when made, which has a material
adverse effect on the rights of the Investor Certificateholders of any Series
and which material adverse effect continues for a period of 60 days after the
date on which written notice thereof, requiring the same to be remedied, shall
have been given to the Servicer by the Trustee; provided, however, that a
"Servicer Default" shall not be deemed to have occurred if the Seller or the
Servicer shall have repurchased the related Receivables or, if applicable, all
of such Receivables during such period in accordance with the provisions of this
Agreement;
(e) the Servicer shall consent to the appointment of a conservator
or receiver or liquidator or other similar official in any bankruptcy,
insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings of or relating to the Servicer or of or relating to all or
substantially all of its property, or a decree or order of a court or agency or
67
supervisory authority having jurisdiction in the premises for the appointment of
a conservator or receiver or liquidator or other similar official in any
insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Servicer and such decree or order shall have
remained in force undischarged or unstayed for a period of sixty days; or the
Servicer shall admit in writing its inability to pay its debts generally as they
become due, file a petition to take advantage of any applicable bankruptcy,
insolvency or reorganization statute, make any assignment for the benefit of its
creditors or voluntarily suspend payment of its obligations;
then, in the event of any Servicer Default, so long as the Servicer Default
shall not have been remedied, the Trustee, by notice then given in writing to
the Servicer (a "Termination Notice"), may terminate all but not less than all
of the rights and obligations (other than its obligations that have accrued up
to the time of such termination) of the Servicer as Servicer under this
Agreement and in and to the Receivables and the proceeds thereof. After receipt
by the Servicer of a Termination Notice, and on the date that a Successor
Servicer shall have been appointed by the Trustee pursuant to Section 10.2, all
authority and power of the Servicer under this Agreement shall pass to and be
vested in a Successor Servicer (a "Service Transfer") and, without limitation,
the Trustee is hereby authorized and empowered (upon the failure of the Servicer
to cooperate) to execute and deliver, on behalf of the Servicer, as
attorney-in-fact or otherwise, all documents and other instruments upon the
failure of the Servicer to execute or deliver such documents or instruments, and
to do and accomplish all other acts or things necessary or appropriate to effect
the purposes of such Service Transfer; provided that in no event shall the
Servicer incur any liability for any such action by the Trustee. The Servicer
agrees to cooperate with the Trustee and such Successor Servicer in effecting
the termination of the responsibilities and rights of the Servicer to conduct
servicing hereunder, including the transfer to such Successor Servicer of all
authority of the Servicer to service the Receivables provided for under this
Agreement, including all authority over all Collections which shall on the date
of transfer be held by the Servicer for deposit, or which have been deposited by
the Servicer, in the Collection Account, or which shall thereafter be received
with respect to the Receivables, and in assisting the Successor Servicer. The
Servicer shall promptly transfer its electronic records relating to the
Receivables to the Successor Servicer in such electronic form as the Successor
Servicer may reasonably request and shall promptly transfer to the Successor
Servicer all other records, correspondence and documents necessary for the
continued servicing of the Receivables in the manner and at such times as the
Successor Servicer shall reasonably request. To the extent that compliance with
this Section 10.1 shall require the Servicer to disclose to the Successor
Servicer information of any kind which the Servicer reasonably deems to be
confidential, the Successor Servicer shall be required to enter into such
customary licensing and confidentiality agreements as the Servicer shall deem
necessary to protect its interest.
Notwithstanding the foregoing, a delay in or failure of performance
under Section 10.1(a) for a period of 10 Business Days or under Section 10.1(b),
(c) or (d) for a period of 60 Business Days, shall not constitute a Servicer
Default if such delay or failure could not be prevented by the exercise of
reasonable diligence by the Servicer and such delay or failure was caused by an
act of God or the public enemy, acts of declared or undeclared war, public
disorder, rebellion or sabotage, epidemics, landslides, lightning, fire,
hurricanes, earthquakes, floods or similar causes. The preceding sentence shall
not relieve the Servicer from using its best efforts to perform its obligations
in a timely manner in accordance with the terms of this Agreement,
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and the Servicer shall provide the Trustee, any Agents, any Enhancement
Providers, the Seller and the Certificateholders with an Officers' Certificate
giving prompt notice of such failure or delay by it, together with a description
of its efforts so to perform its obligations. The Servicer shall immediately
notify the Trustee in writing of any Servicer Default.
SECTION 10.2. Trustee to Act; Appointment of Successor. (a) On and
after the receipt by the Servicer of a Termination Notice pursuant to Section
10.1, the Servicer shall continue to perform all servicing functions under this
Agreement until the date specified in the Termination Notice or otherwise
specified by the Trustee in writing or, if no such date is specified in such
Termination Notice, or as otherwise specified by the Trustee, until a date
mutually agreed upon by the Servicer and Trustee. The Trustee shall as promptly
as possible after the giving of a Termination Notice appoint an Eligible
Servicer as a successor servicer (the "Successor Servicer"), subject to the
consent of any Enhancement Providers and any Agents, which consent shall not be
unreasonably withheld, and such Successor Servicer shall accept its appointment
by a written assumption in a form acceptable to the Trustee. In the event that a
Successor Servicer has not been appointed or has not accepted its appointment at
the time when the Servicer ceases to act as Servicer, the Trustee without
further action shall automatically be appointed the Successor Servicer. The
Trustee may delegate any of its servicing obligations to an affiliate or agent
in accordance with Sections 3.1 and 8.7. Notwithstanding the above, the Trustee
shall, if it is legally unable so to act, petition a court of competent
jurisdiction to appoint any established institution having a net worth of not
less than $100,000,000 and whose regular business includes the servicing of
wholesale receivables as the Successor Servicer hereunder. The Trustee shall
promptly give notice to the Rating Agencies, any Enhancement Providers, any
Agents and the Certificateholders upon the appointment of a Successor Servicer.
(b) Upon its appointment, the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions
under this Agreement and shall be subject to all the responsibilities, duties
and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof (except that the Successor Servicer shall not be liable for
any liabilities incurred by the predecessor Servicer), and all references in
this Agreement to the Servicer shall be deemed to refer to the Successor
Servicer, except for references in Sections 3.3 (as it relates to the Initial
Servicer) and 8.4 (exclusive of indemnification for acts, omissions, alleged
acts and alleged omissions that constitute fraud, gross negligence, breach of
fiduciary duty or wilful misconduct by the Successor Servicer) and 11.5, which
shall continue to refer to the Initial Servicer. Any Successor Servicer, by its
acceptance of its appointment, shall automatically agree to be bound by the
terms and provisions of any Enhancement Agreement.
(c) In connection with any Termination Notice, the Trustee shall
review any bids which it obtains from Eligible Servicers and shall be permitted
to appoint any Eligible Servicer submitting such a bid as a Successor Servicer
for servicing compensation not in excess of the Servicing Fee (provided that if
all such bids exceed the Servicing Fee the Seller at its own expense shall pay
when due the amount of any compensation in excess of the Servicing Fee);
provided, however, that the Seller shall be responsible for payment of the
Seller's portion of the Servicing Fee as determined pursuant to this Agreement
and all other amounts in excess of the Investors' Servicing Fee, and that no
such monthly compensation paid out of Collections shall be in excess of the
Investors' Servicing Fee permitted to the Servicer. The Holders of the Seller's
Certificates agree that if DFS (or any Successor Servicer) is terminated as
Servicer hereunder,
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the portion of Collections to be paid to the Seller shall be reduced by an
amount sufficient to pay Seller's share of the compensation of the Successor
Servicer.
(d) All authority and power granted to the Successor Servicer
under this Agreement shall automatically cease and terminate upon termination of
the Trust pursuant to Section 12.1, and shall pass to and be vested in the
Seller and, without limitation, the Seller is hereby authorized and empowered to
execute and deliver, on behalf of the Successor Servicer, as attorney-in-fact or
otherwise, all documents and other instruments, and to do and accomplish all
other acts or things necessary or appropriate to effect the purposes of such
transfer of servicing rights. The Successor Servicer agrees to cooperate with
the Seller in effecting the termination of the responsibilities and rights of
the Successor Servicer to conduct servicing on the Receivables. The Successor
Servicer, at the expense of the Seller, shall transfer its electronic records
relating to the Receivables to the Seller in such electronic form as the Seller
may reasonably request and shall transfer all other records, correspondence and
documents to the Seller in the manner and at such times as the Seller shall
reasonably request. To the extent that compliance with this Section 10.2 shall
require the Successor Servicer to disclose to the Seller information of any kind
which the Successor Servicer deems to be confidential, the Seller shall be
required to enter into such customary licensing and confidentiality agreements
as the Successor Servicer shall deem necessary to protect its interests.
All reasonable costs and expenses (including attorneys' fees)
incurred in connection with transferring the Receivables and the other Trust
Assets to the Successor Servicer and amending this Agreement to reflect such
succession as Successor Servicer pursuant to this Article X shall be paid by the
Servicer (or, if the Trustee is the Successor Servicer, the initial Servicer)
upon presentation of reasonable documentation of such costs and expenses.
ARTICLE XI
The Trustee
SECTION 11.1. Duties of Trustee. (a) The Trustee, prior to the
occurrence of a Servicer Default of which a Responsible Officer of the Trustee
has knowledge and after the curing of all Servicer Defaults which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. If a Servicer Default to the knowledge
of a Responsible Officer of the Trustee has occurred (which has not been cured
or waived), the Trustee shall exercise such of the rights and powers vested in
it by this Agreement and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
substantially conform to the requirements of this Agreement.
(c) Subject to Section 11.1(a), no provision of this Agreement
shall be construed to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act or its own wilful misconduct; provided,
however, that:
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(i) the Trustee shall not be personally liable for an error
of judgment made in good faith by a Responsible Officer or
Responsible Officers of the Trustee, unless it shall be proved that
the Trustee was negligent in ascertaining the pertinent facts;
(ii) the Trustee shall not be charged with knowledge of any
Servicer Default or the failure by the Servicer to comply with the
obligations of the Servicer referred to in Section 10.1(a) and (b)
unless a Responsible Officer of the Trustee obtains actual knowledge
of such failure;
(iii) the Trustee shall not be charged with knowledge of an
Early Amortization Event (or the related Early Amortization Period)
unless a Responsible Officer of the Trustee obtains actual knowledge
thereof;
(iv) the Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of the Holders of Investor
Certificates relating to the time, method or place of conducting any
proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Agreement
or any Supplement; and
(v) prior to the occurrence of a Servicer Default of which a
Responsible Officer has knowledge, and after the curing or waiver of
such Servicer Defaults that may have occurred, the duties and
obligations of the Trustee shall be determined solely by the express
provisions of this Agreement and any Supplements, the Trustee shall
not be liable except for the performance of such duties and
obligations as shall be specifically set forth in this Agreement and
any Supplement, no implied covenants or obligations shall be read
into this Agreement or any Supplement against the Trustee and, in
the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates
or opinions furnished to the Trustee and, if specifically required
to be furnished pursuant to any provision of this Agreement or any
Supplement, conforming to the requirements of this Agreement or such
Supplement.
(d) The Trustee shall not be required 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 there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Agreement shall in any event require
the Trustee to perform, or be responsible for the manner of performance of, any
obligations of the Servicer under this Agreement except during such time, if
any, as the Trustee shall be the successor to, and be vested with the rights,
duties, powers and privileges of, the Servicer in accordance with the terms of
this Agreement. Notwithstanding the prior sentence, the Trustee when acting as
Successor Servicer, is still entitled to indemnification under Sections 7.3 and
8.4.
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(e) Except as expressly provided in this Agreement, the Trustee
shall have no power to vary the corpus of the Trust including the power to (i)
accept any substitute obligation for a Receivable initially assigned to the
Trust under Section 2.1 or 2.5, (ii) add any other investment, obligation or
security to the Trust or (iii) withdraw from the Trust any Receivables.
(f) In the event that the Transfer Agent and Registrar shall fail
to perform any obligation, duty or agreement in the manner or on the day
required to be performed by the Transfer Agent and Registrar, as the case may
be, under this Agreement, the Trustee shall be obligated promptly upon a
Responsible Officer of the Trustee obtaining actual knowledge of such failure to
perform such obligation, duty or agreement in the manner so required.
(g) If the Seller has agreed to transfer any of its wholesale
receivables (other than the Receivables) to another Person, then upon the
written request of the Seller, the Trustee shall enter into such intercreditor
agreements with the transferee of such receivables as are customary and
necessary to identify separately the rights of the Trustee and the Trust, on the
one hand, and such other Person, on the other hand, in the Seller's wholesale
receivables; provided, however, that the Trustee shall not be required to enter
into any intercreditor agreement which could, in the sole opinion of the
Trustee, adversely affect the interests of the Investor Certificateholders or
the Trustee and, upon the request of the Trustee, the Seller shall deliver an
Opinion of Counsel on any matters relating to such intercreditor agreement,
reasonably requested by the Trustee.
(h) Notwithstanding any other provision contained herein, the
Trustee is not acting as, and shall not be deemed to be, a fiduciary for any
Enhancement Provider in its capacity as such or as a Beneficiary, and the
Trustee's sole responsibility with respect to said parties shall be to perform
those duties with respect to said parties as are specifically set forth herein
and no implied duties or obligations shall be read into this Agreement against
the Trustee with respect to any such party.
SECTION 11.2. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 11.01:
(a) the Trustee may rely on and shall be protected in acting on,
or in refraining from acting in accord with, any resolution, Officers'
Certificate, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal, bond or
other paper or document believed by it to be genuine and to have been signed or
presented to it pursuant to this Agreement by the proper party or parties;
(b) the Trustee may consult with counsel and any advice or Opinion
of Counsel shall be full and complete authorization and protection in respect of
any action taken or suffered or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(c) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement, or to institute, conduct or
defend any litigation hereunder or in relation hereto, at the request, order or
direction of any of the Certificateholders, pursuant to the provisions of this
Agreement, unless such Certificateholders shall have offered to the Trustee
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reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; provided, however, that nothing
contained herein shall relieve the Trustee of the obligations, upon the
occurrence of a Servicer Default (which has not been cured or waived) of which a
Responsible Officer of the Trustee has knowledge, to exercise such of the rights
and powers vested in it by this Agreement or any Supplement, and to use the same
degree of care and skill in their exercise as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs;
(d) the Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Agreement;
(e) the Trustee shall not be bound to make any investigation into
the facts of matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond or
other paper or document believed by it to be genuine, unless requested so to do
by (i) Holders of Investor Certificates evidencing more than 25% of the
aggregate unpaid principal amount of all Investor Certificates (or, with respect
to any such matters that do not relate to all Series, 25% of the aggregate
unpaid principal amount of the Investor Certificates of all Series to which such
matters relate); 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 shall be, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the terms of
this 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 Servicer or, if paid by the Trustee,
shall be reimbursed by the Servicer upon demand;
(f) 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, and the Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent, attorney or custodian
appointed with due care by it hereunder;
(g) except as may be required by Section 11.1(a) hereof, the
Trustee shall not be required to make any initial or periodic examination of any
documents or records related to the Receivables or the Accounts for the purpose
of establishing the presence or absence of defects, the compliance by the Seller
with its representations and warranties or for any other purpose; and
(h) the right of the Trustee to perform any discretionary act
enumerated in this Agreement or any Supplement shall not be construed as a duty,
and the Trustee shall not be answerable for other than its negligence or willful
misconduct in the performance of any such act.
SECTION 11.3. Trustee Not Liable for Recitals in Certificates. The
Trustee assumes no responsibility for the correctness of the recitals contained
herein and in the Certificates (other than the certificate of authentication on
the Certificates). Except as set forth in Section 11.14, the Trustee makes no
representations as to the validity or sufficiency of this Agreement or of the
Certificates (other than the certificate of authentication on the Certificates)
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or of any Receivable or related document or any security interest of the Trust
therein. The Trustee shall not be accountable for the use or application by the
Seller of any of the Certificates or of the proceeds of such Certificates, or
for the use or application of any funds paid to the Seller in respect of the
Receivables or deposited in or withdrawn from the Collection Account or any
Series Account.
SECTION 11.4. Trustee May Own Certificates. Subject to compliance
with subsection (a)(4)(i) of Rule 3a-7 of the Investment Company Act: (x) the
Trustee in its individual or any other capacity may become the owner or pledgee
of Investor Certificates and (y) the Trustee in its individual or any other
capacity may deal with the Seller and Servicer in banking and other transactions
with the same rights as it would have if it were not the Trustee.
SECTION 11.5. The Servicer to Pay Trustee's Fees and Expenses. The
Servicer covenants and agrees to pay to the Trustee from time to time, and the
Trustee shall be entitled to receive, reasonable compensation (which shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust) for all services rendered by it in the execution of the trust
hereby created and in the exercise and performance of any of the power and
duties hereunder of the Trustee, and, subject to Section 8.4, the Servicer shall
pay or reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee accordance with any
of the provisions of this Agreement (including the reasonable fees and expenses
of its agents, any co-trustee and counsel) except any such expense, disbursement
or advance as may arise from its negligence or bad faith and except as provided
in the second following sentence. The Servicer's covenants to pay the expenses,
disbursements and advances provided for in the preceding sentence shall survive
the resignation or removal of the Trustee and the termination of this Agreement.
If the Trustee is appointed Successor Servicer pursuant to Section 10.2, the
provisions of this Section 11.5 shall not apply to expenses, disbursements and
advances made or incurred by the Trustee in its capacity as Successor Servicer,
which shall be covered out of the Servicing Fee; provided, however, if such
expenses, disbursements and advances incurred by the Trustee are in amount in
excess of the Servicing Fee, such excess amount shall be paid in full to the
Trustee by DFS. To the extent, if any, that any Federal, state or local taxes
are payable by the Trust, such taxes shall be payable solely out of Trust Assets
an not out of the personal assets of the Trustee.
SECTION 11.6. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be a bank (a) organized and doing business under
the laws of the United States of America or any state thereof authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least $50,000,000 and subject to supervision or examination by
Federal or state authority and (b) which is in compliance with subsection
(a)(4)(i) of Rule 3a-7 of the Investment Company Act. If such bank publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority then, for the purpose of
this Section 11.6, the combined capital and surplus of such bank shall be deemed
to be its combined capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 11.6, the Trustee
shall resign immediately in the manner and with the effect specified in Section
11.7.
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SECTION 11.7. Resignation or Removal of Trustee. (a) The Trustee may
at any time resign and be discharged from the trust hereby created by giving
written notice thereof to the Seller and the Servicer. Upon receiving such
notice of resignation, the Seller shall promptly appoint a successor trustee by
written instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the successor trustee. If no
successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor trustee.
(b) The Servicer may remove the Trustee at any time and from time
to time by giving written notice of such removal to the Trustee if any of the
following events or circumstances occurs at any time (such notice to be sent at
least thirty days prior to the date of removal in the case of clause (vi)
below):
(i) the Trustee shall cease to be eligible in accordance
with Section 11.6 and shall fail to resign after written
request therefor by the Servicer; or
(ii) the Trustee shall be legally unable to act; or
(iii) the Trustee shall be adjudged a bankrupt or insolvent;
or
(iv) a receiver of the Trustee or of its property shall be
appointed; or
(v) any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation; or
(vi) the Trustee shall fail to perform, as determined by the
Servicer in its sole discretion, any of the Trustee's
duties or responsibilities under this Agreement or any
Supplement in a manner and at a cost that is
satisfactory to the Servicer.
The Servicer shall promptly appoint a successor trustee by written instrument,
in duplicate, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee.
(c) Any resignation or removal of the Trustee and appointment of
successor trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee as
provided in Section 11.8 hereof.
SECTION 11.8. Successor Trustee. (a) Any successor trustee appointed
as provided in Section 11.7 hereof shall execute, acknowledge and deliver to the
Seller and to its predecessor Trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor Trustee
shall become effective and such successor trustee, without any further act, deed
or conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as Trustee herein. The predecessor Trustee shall deliver to the successor
trustee all
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documents or copies thereof, at the expense of the Servicer, and statements held
by it hereunder; and the Seller and the predecessor Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for fully and certainly vesting and confirming in the successor trustee all such
rights, power, duties and obligations. The Servicer shall immediately give
notice to each Rating Agency and the Certificateholders upon the appointment of
a successor trustee.
(b) No successor trustee shall accept appointment as provided in
this Section 11.8 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 11.6 hereof.
SECTION 11.9. Merger or Consolidation of Trustee. Any Person into
which the Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
all or substantially all of the corporate trust business of the Trustee, shall
be the successor of the Trustee hereunder, provided such corporation shall be
eligible under the provisions of Section 11.6 hereof, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
SECTION 11.10. Appointment of Co-Trustee or Separate Trustee. (a)
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust may at the time be located, the Trustee shall have the power and
may execute and deliver all instruments to appoint one or more Persons to act as
a co-trustee or co-trustees, or separate trustee or separate trustees, of all or
any part of the Trust, and to vest in such Person or Persons, in such capacity
and for the benefit of the Certificateholders, such title to the Trust, or any
part thereof, and, subject to the other provisions of this Section 11.10, 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
11.6 and no notice to Certificateholders of the appointment of any co-trustee or
separate trustee shall be required under Section 11.8 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee
or co-trustee is not authorized to act separately without the
Trustee joining in such act), except to the extent that under any
law of any jurisdiction in which any particular act or acts are to
be performed (whether as Trustee hereunder or as successor to the
Servicer hereunder), 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;
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(ii) no trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee hereunder; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article XI. 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 Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee and a
copy thereof given to the Servicer.
(d) Any separate trustee or co-trustee may at any time constitute
the Trustee, its agent or attorney-in-fact, with full power and authority, to
the extent not prohibited by law, to do any lawful act under or in respect of
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 11.11. Tax Returns. In the event the Trust shall be required
to file tax returns, the Servicer shall prepare, or shall cause to be prepared,
and shall deliver, or shall cause to be delivered, to the Trustee no later than
five Business Days immediately preceding any applicable due date; the Trustee
shall promptly execute, to the extent it is the appropriate person to so
execute, file any such tax returns to be filed by the Trust and deliver such
executed returns to the Servicer, and such returns shall be filed by the
Servicer. The Servicer in accordance with the terms of the Supplements shall
also prepare or shall cause to be prepared all tax information required by law
to be distributed to the Investor Certificateholders. The Trustee shall
distribute or cause to be distributed such information to the Investor
Certificateholders. The Trustee, upon request, shall furnish the Servicer with
all such information known to the Trustee as may be reasonably required in
connection with the preparation of all tax returns of the Trust or in connection
with the distribution of tax information to the Investor Certificateholders.
SECTION 11.12. Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee. Any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Certificateholders in respect of which such judgment has
been obtained.
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SECTION 11.13. Suits for Enforcement. If a Servicer Default shall
occur and be continuing, the Trustee, in its discretion may, subject to the
provisions of Section 10.1, proceed to protect and enforce its rights and the
rights of the Certificateholders under this Agreement by suit, action or
proceeding in equity or at law or otherwise, whether for the specific
performance of any covenant or agreement contained in this Agreement or in aid
of the execution of any power granted in this Agreement or for the enforcement
of any other legal, equitable or other remedy as the Trustee, being advised by
counsel, shall deem most effectual to protect and enforce any of the rights of
the Trustee or the Certificateholders. Nothing herein contained shall be deemed
to authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Certificateholder any plan of reorganization, arrangement, adjustment or
composition affecting the Certificates or the rights of any Holder thereof, or
authorize the Trustee to vote in respect of the claim of any Certificateholder
in any such proceeding.
SECTION 11.14. Representations and Warranties of Trustee. The
Trustee represents and warrants that:
(i) the Trustee is a banking corporation organized, existing
and in good standing under the laws of the State of New York;
(ii) the Trustee has full power, authority and right to
execute, deliver and perform this Agreement, and has taken all
necessary action to authorize the execution, delivery and
performance by it of this Agreement; and
(iii) this Agreement has been duly executed and delivered by
the Trustee.
SECTION 11.15. Maintenance of Office or Agency. The Trustee shall
maintain at its expense in the Borough of Manhattan, The City of New York, an
office or offices or agency or agencies where notices and demands to or upon the
Trustee in respect of the Certificates and this Agreement may be served. The
Trustee initially designates its Corporate Trust Office as its office such
purposes in New York. The Trustee shall give prompt written notice to the
Servicer and to Holders of the Certificates of a change in the location of the
Certificate Register or any such office or agency. So long as any of the
Certificates are listed on the Luxembourg Stock Exchange and such stock exchange
shall so require, the Trustee shall maintain an additional Paying Agent in
Luxembourg.
ARTICLE XII
Termination
SECTION 12.1. Termination of Trust. The Trust and the respective
obligations and responsibilities of the Seller, the Servicer and the Trustee
created hereby (other than the obligation of the Trustee to make payments to
Investor Certificateholders as hereafter set forth) shall terminate, except with
respect to the duties described in Sections 7.3, 8.4, 11.5 and 12.2(b), upon the
earlier of (i) December 31, 2014 (the "Final Maturity Date"), (ii) the day
following the Distribution Date on which the Invested Amount for all Series is
zero, but only if the Seller has notified the Trustee that it wishes the Trust
to terminate upon such event and (iii) the time
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provided in Section 9.2(b) (the "Trust Termination Date"). The Servicer shall
give the Rating Agencies prompt notice of the termination of the Trust.
SECTION 12.2. Final Distribution. (a) The Servicer shall give the
Trustee notice of the Distribution Date on which the Investor Certificateholders
of any Series or Class may surrender their Investor Certificates for payment of
the final distribution on and cancellation of such Investor Certificates
promptly after the Servicer has determined that a final distribution shall
occur. Such notice shall be accompanied by an Officer's Certificate setting
forth the information specified in Section 3.5 covering the period during the
then-current calendar year through the date of such notice. Upon at least one
Business Day's prior written notice by the Servicer, not later than the fifth
day of the month in which the final distribution in respect of such Series or
Class is payable to Investor Certificateholders, the Trustee shall provide
notice to Investor Certificateholders of such Series or Class specifying (i) the
date upon which final payment of such Series or Class shall be made upon
presentation and surrender of Investor Certificates of such Series or Class at
the office or offices therein designated, (ii) the amount of any such final
payment and (iii) that the Record Date otherwise applicable to such payment date
is not applicable, payments being made only upon presentation and surrender of
such Investor Certificates at the office or office therein specified. The
Trustee shall give such notice to the Transfer Agent and Registrar and the
Rating Agencies at the time such notice is given to Investor Certificateholders.
Notice of the final distribution with respect to any Class of
Certificates listed on the Luxembourg Stock Exchange (so long as the rules
thereof so require) shall be published by the Trustee once in an Authorized
European Newspaper.
(b) Notwithstanding a final distribution to the Investor
Certificateholders of any Series or Class (or the termination of the Trust),
except as otherwise provided in this paragraph, all funds then on deposit in the
Collection Account and any Series Account allocated to such Investor
Certificateholders shall continue to be held in trust for the benefit of such
Investor Certificateholders and the Trustee shall pay such funds to such
Investor Certificateholders upon surrender of their Investor Certificates (and
any excess shall be paid in accordance with the terms of any Enhancement
Agreement). In the event that all such Investor Certificateholders shall not
surrender their Investor Certificates for cancellation within six months after
the date specified in the notice from the Trustee described in paragraph (a),
the Trustee shall give a second notice to the remaining such Investor
Certificateholders to surrender their Investor Certificates for cancellation and
receive the final distribution with respect thereto. If within one year after
the second notice all such Investor Certificates shall not have been surrendered
for cancellation, the Trustee may take appropriate steps, or may appoint an
agent to take appropriate steps, to contact the remaining such Investor
Certificateholders concerning surrender of their Investor Certificates, and the
cost thereof shall be paid out of the funds in the Collection Account or any
Series Account held for the benefit of such Investor Certificateholders. The
Trustee shall pay to the Seller any monies held by it for the payment of
principal or interest with respect to a Series that remain unclaimed for two
years after the date of the first notice of final distribution with respect to
such Series. After such payment to the Seller, Investor Certificateholders
entitled to the money must look to the Seller for payment as general creditors
unless an applicable abandoned property law designates another Person.
79
(c) In the event that the Invested Amount with respect to any
Series is greater than zero on its Termination Date (after giving effect to
deposits and distributions otherwise to be made on such Termination Date), the
Trustee shall sell or cause to be sold on such Termination Date Receivables (or
interests therein) in an amount equal to the sum of (i) the Invested Amount with
respect to such Series on such Termination Date (after giving effect to such
deposits and distributions) plus (ii) accrued and unpaid interest with respect
to such Series; provided, however, that in no event shall such amount exceed the
lesser of (x) such Series' Allocation Percentage (as defined in the Series
Supplements and for the Collection Period in which such Termination Date occurs)
of the aggregate unpaid balance of the Principal Receivables on such Termination
Date and (y) 110% of such Invested Amount. The proceeds, net of all reasonable
expenses incurred by the Trustee in connection with such sale, which shall be
paid to the Trustee from such proceeds (the "Termination Proceeds") from such
sale shall be immediately deposited into the Collection Account for the benefit
of the Investor Certificateholders of such Series. The Termination Proceeds
shall be allocated and distributed to the Investor Certificateholders of such
Series in accordance with the terms of the applicable Supplement.
SECTION 12.3. Seller's Termination Rights. Upon the termination of
the Trust pursuant to Section 12.1, and the surrender of the Seller's
Certificates the Trustee shall sell, assign and convey to the Seller or its
designee, without recourse, representation or warranty, all right, title and
interest of the Trust in the Receivables, whether then existing or thereafter
created, all Collateral Security with respect thereto, all monies due or to
become due and all amounts received with respect thereto and all proceeds
thereof, except for amounts held by the Trustee pursuant to Section 12.2(b), and
all of the Seller's rights, remedies, powers and privileges with respect to such
Receivables under the Receivables Contribution and Sale Agreement. The Trustee
shall execute and deliver such instruments of transfer and assignment, in each
case without recourse, representation or warranty, as shall be reasonably
requested by the Seller to vest in the Seller or its designee all right, title
and interest which the Trust had in all such property.
ARTICLE XIII
Miscellaneous Provisions
SECTION 13.1. Amendment. (a) This Agreement or any Supplement may be
amended from time to time (including in connection with the issuance of a
Supplemental Certificate) by the Servicer, the Seller and the Trustee without
the consent of any of the Certificateholders, but with prior notice to each
Rating Agency, provided that such amendment shall not, as evidenced by an
Officer's Certificate of the Seller, addressed and delivered to the Trustee,
adversely affect in any material respect the interests of any Investor
Certificateholder. In addition, this Agreement and any Supplement may be amended
by the Servicer and the Trustee at the direction of the Seller without the
consent of any of the Certificateholders: (1) to add, modify or eliminate such
provisions as may be necessary or advisable in order to enable the Seller or any
of its Affiliates (including Deutsche Bank AG) to minimize or avoid capital
charges under any applicable law, rule, regulation or guideline relating to
regulatory or risk-based capital, or (2) to enable all or a portion of the Trust
to qualify as a partnership for federal income tax purposes under applicable
regulations on the classification of entities as partnerships or
80
corporations under the Internal Revenue Code, and to the extent that such
regulations eliminate or modify the need therefor, to modify or eliminate
existing provisions of this Agreement or any Supplement relating to the intended
availability of partnership treatment of the Trust for federal income tax
purposes, or (3) to enable all or a portion of the Trust to qualify as, and to
permit an election to be made to cause the Trust to be treated as, a "financial
asset securitization investment trust," as described in the provisions of the
"Small Business Job Protection Act of 1996," H.R. 3448 (and, in connection with
any such election, to modify or eliminate existing provisions of this Agreement
or any Supplement relating to the intended Federal income tax treatment of the
Certificates and the Trust in the absence of such election, which may include
elimination of the sale of Receivables, upon the occurrence of an insolvency
event with respect to Seller, pursuant to the Agreement and certain provisions
of the Agreement relating to the liability of the Seller), or (4) to enable the
Seller or any of its Affiliates to comply with or obtain more favorable
treatment under any law or regulation or any accounting rule or principle, so
long as in each case the Rating Agency Condition has been satisfied and, in the
case of (2) or (3), the Seller and the Trustee have received an Opinion of
Counsel to the effect that such amendment shall not adversely affect the
characterization of the Investor Certificates of any outstanding Series or Class
as debt or as interests in a partnership. Notwithstanding anything contained
herein to the contrary, the Trustee, with the consent of any Enhancement
Providers, may at any time and from time to time amend, modify or supplement the
form of Distribution Date Statement. Notwithstanding anything contained herein
to the contrary, this Agreement or any Supplement may be amended from time to
time by the Servicer, the Seller and the Trustee without the consent of any of
the Certificateholders, but only upon satisfaction of the Rating Agency
Condition, to change in any manner the treatment of Delayed Funding Receivables
under this Agreement or any such Supplement. In addition, this Agreement or any
Supplement may be amended from time to time by the Seller, the Servicer and the
Trustee, without the consent of any Certificateholder, in order to make changes
required in order to obtain a listing of any Class of any Series on the
Luxembourg Stock Exchange.
(b) In the event that Section 13.1(a) is not then applicable, this
Agreement or any Supplement may be amended from time to time (including in
connection with the issuance of a Supplemental Certificate) by the Servicer, the
Seller and the Trustee, with the consent of the Holders of Investor Certificates
evidencing more than 50% of the aggregate unpaid principal amount of the
Investor Certificates of all adversely affected Series and with prior notice to
each Rating Agency, for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or any
Supplement or of modifying in any manner the rights of the Certificateholders;
provided, however, that no such amendment shall (i) reduce in any manner the
amount of, or delay the timing of, any distributions required to be made to any
Investor Certificateholders or deposits of amounts to be so distributed or the
amount available under any Enhancement without the consent of each affected
Investor Certificateholder, (ii) change the definition of or the manner of
calculating the interest of any Investor Certificateholder without the consent
of each affected Investor Certificateholder, (iii) reduce the aforesaid
percentage required to consent to any such amendment without the consent of each
Investor Certificateholder or (iv) adversely affect the rating of any Series or
Class by any Rating Agency without the consent of all of the Holders of the
Investor Certificates of such Series or Class. Any amendment to be effected
pursuant to this paragraph shall be deemed to adversely affect all outstanding
Series, other than any Series with respect to which such action shall not, as
evidenced by an Officer's Certificate of the Seller, addressed and delivered to
the
81
Trustee, adversely affect in any material respect the interests of any Investor
Certificateholder of such Series. The Trustee may, but shall not be obligated
to, enter into any such amendment which affects the Trustee's rights, duties or
immunities under this Agreement or otherwise.
(c) Promptly after the execution of any such amendment or consent
(other than an amendment pursuant to paragraph (a)), the Trustee shall furnish
notification of the substance of such amendment to each Investor
Certificateholder, and the Servicer shall furnish notification of the substance
of such amendment to each Rating Agency, each Agent and each Enhancement
Provider.
(d) It shall not be necessary for the consent of Investor
Certificateholders under this Section to approve the particular form of any
proposed amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Investor Certificateholders shall be
subject to such reasonable requirements as the Trustee may prescribe.
(e) Notwithstanding anything in this Section to the contrary, no
amendment may be made to this Agreement or any Supplement which would adversely
affect in any material respect the interests of any Enhancement Provider without
the written consent of such Enhancement Provider.
(f) Any Supplement executed in accordance with the provisions of
Section 6.3 shall not be considered an amendment to this Agreement for the
purposes of this Section.
(g) Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon (i) an Opinion of Counsel
stating that the execution of such amendment is authorized or permitted by this
Agreement and that all conditions precedent to such execution and delivery have
been satisfied and (ii) the Opinion of Counsel required by Section 13.2(d). The
Trustee may, but shall not be obligated to, enter into any such amendment which
affects the Trustee's own rights, duties or immunities under this Agreement.
SECTION 13.2. Protection of Right, Title and Interest to Trust. (a)
The Servicer shall cause this Agreement, all amendments hereto and/or all
financing statements and continuation statements and any other necessary
documents covering the Certificateholders' and the Trustee's right, title and
interest in and to the Trust Assets to be promptly recorded, registered and
filed, and at all times to be kept recorded, registered and filed, all in such
manner and in such places as may be required by law fully to preserve and
protect the right, title and interest of the Certificateholders and the Trustee
hereunder to all property comprising the Trust. The Servicer shall deliver to
the Trustee file-stamped copies of, or filing receipts for, any document
recorded, registered or filed as provided above, as soon as available following
such recording, registration or filing. The Seller shall cooperate fully with
the Servicer in connection with the obligations set forth above and shall
execute any and all documents reasonably required to fulfill the intent of this
Section 13.2(a).
(b) Within 30 days after the Seller or the Servicer makes any
change in its name, identity or corporate structure which would make any
financing statement or continuation
82
statement filed in accordance with Section 13.2(a) seriously misleading within
the meaning of Section 9-402(7) of the UCC as in effect in the applicable
jurisdiction (including as a result of a Designated Affiliate Transfer), the
Seller shall give the Trustee and any Agent notice of any such change and shall
file such financing statements or amendments as may be necessary to continue the
perfection of the Trust's security interest in the Receivables and the proceeds
thereof.
(c) The Seller and the Servicer shall give the Trustee and any
Agent prompt written notice of any relocation of any office from which it
services Receivables or keeps Records concerning the Receivables or of its
principal executive office if, as a result of such relocation, the applicable
provisions of the UCC would require the filing of any amendment of any
previously filed financing or continuation statement or of any new financing
statement and shall file such financing statements or amendments as may be
necessary to perfect or to continue the perfection of the Trust's security
interest in the Receivables and the proceeds thereof. The Seller and the
Servicer shall at all times maintain each office from which it services
Receivables and its principal executive office within the United States of
America.
(d) The Servicer shall deliver to the Trustee, any Agent and any
Enhancement Provider, upon the execution and delivery of each amendment of this
Agreement or any Supplement, an Opinion of Counsel to the effect specified in
Exhibit G-1.
SECTION 13.3. Limitation on Rights of Certificateholders. (a) The
death or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor shall such death or incapacity entitle such
Certificateholders' legal representatives or heirs to claim an accounting or to
take any action or commence any proceeding in any court for a partition or
winding-up of the Trust, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them.
(b) No Investor Certificateholder shall have any right to vote
(except as expressly provided in this Agreement) or in any manner otherwise
control the operation and management of the Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Certificates, be construed so as to constitute the Investor
Certificateholders from time to time as partners or members of an association,
nor shall any Investor Certificateholder be under any liability to any third
person by reason of any action taken by the parties to this Agreement pursuant
to any provision hereof.
(c) No Investor Certificateholder shall have any right by virtue
of any provisions of this Agreement to institute any suit, action or proceeding
in equity or at law upon or under or with respect to this Agreement, unless such
Investor Certificateholder previously shall have made, and unless the Holders of
Investor Certificates evidencing more than 50% of the aggregate unpaid principal
amount of all Investor Certificates (or, with respect to any such action, suit
or proceeding that does not relate to all Series, 50% of the aggregate unpaid
principal amount of the Investor Certificates of all Series to which such
action, suit or proceeding relates) shall have made, a request to the Trustee to
institute such action, suit or proceeding in its own name as Trustee hereunder
and shall have offered to the Trustee such reasonable indemnity as it may
require against the costs, expenses and liabilities to be incurred therein or
thereby, and the Trustee, for 60 days after such request and offer of indemnity,
shall have neglected or refused to institute any such action, suit or
proceeding; it being understood and intended, and being
83
expressly covenanted by each Investor Certificateholder with every other
Investor Certificateholder and the Trustee, that no one or more Investor
Certificateholders shall have any right in any manner whatever by virtue or by
availing itself or themselves of any provisions of this Agreement to affect,
disturb or prejudice the rights of the holders of any other of the Investor
Certificates, or to obtain or seek to obtain priority over or preference to any
other such Investor Certificateholder, or to enforce any right under this
Agreement, except in the manner herein provided and for the equal, ratable and
common benefit of all Investor Certificateholders except as otherwise expressly
provided in this Agreement. For the protection and enforcement of the provisions
of this Section, each and every Investor Certificateholder and the Trustee shall
be entitled to such relief as can be given either at law or in equity.
SECTION 13.4. No Petition. The Servicer, DFS (if it is no longer the
Servicer) and the Trustee (not in its individual capacity but solely as
Trustee), by entering into this Agreement, each Investor Certificateholder, by
accepting an Investor Certificate or an interest in an Investor Certificate,
each holder of a Supplemental Certificate by accepting a Supplemental
Certificate and any Successor Servicer and each other Beneficiary and each
Certificate Owner, by accepting the benefits of this Agreement, hereby covenants
and agrees or is deemed to covenant and agree, that they shall not at any time
institute against, or encourage or solicit any Person to institute against,
Deutsche FRLP, the general partner of Deutsche FRLP or the Trust, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States Federal or state bankruptcy or
similar law.
SECTION 13.5. GOVERNING LAW. THIS AGREEMENT AND THE CERTIFICATES
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
SECTION 13.6. Notices. (a) All demands, notices, instructions,
directions and communications (collectively, "Notices") under this Agreement
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by registered mail, return receipt requested, to (i) in
the case Deutsche FRLP, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Secretary, (ii) in the case of DFS, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇.
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Secretary, (iii) in the case of the Trustee,
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Capital
Markets Fiduciary Services, Deutsche Floorplan Receivables, (iv) in the case of
Standard & Poor's, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Asset Backed Surveillance Department, (v) in the case of ▇▇▇▇▇'▇, ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Structured Finance
Surveillance, (vi) in the case of Fitch, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, or, as to each party and Rating Agency, at such other address as
shall be designated by such party or Rating Agency in a written notice to each
other party.
(b) Any Notice required or permitted to be given to a Holder of
Registered Certificates shall be given by first-class mail, postage prepaid, at
the address of such Holder as shown in the Certificate Register. Any Notice so
mailed within the time prescribed in this
84
Agreement shall be conclusively presumed to have been duly given, whether or not
the Investor Certificateholder receives such Notice.
SECTION 13.7. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or rights of the Certificateholders.
SECTION 13.8. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 8.2, this Agreement may not be
assigned by the Servicer.
SECTION 13.9. Certificates Nonassessable and Fully Paid. It is the
intention of the parties to this Agreement that the Investor Certificateholders
shall not be personally liable for obligations of the Trust, that the interests
in the Trust represented by the Investor Certificates shall be nonassessable for
any losses or expenses of the Trust or for any reason whatsoever and that
Investor Certificates upon authentication thereof by the Trustee are and shall
be deemed fully paid.
SECTION 13.10. Further Assurances. The Seller and the Servicer agree
to do and perform, from time to time, any and all acts and to execute any and
all further instruments required or reasonably requested by the Trustee more
fully to effect the purposes of this Agreement, including the execution of any
financing statements or continuation statements relating to the Receivables for
filing under the provisions of the UCC of any applicable jurisdiction.
SECTION 13.11. No Waiver, Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Trustee or the
Certificateholders, any right, remedy, power or privilege under this Agreement
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege under this Agreement preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges provided under this
Agreement are cumulative and not exhaustive of any rights, remedies, powers and
privileges provided by law.
SECTION 13.12. Counterparts. This Agreement may be executed in two
or more counterparts (and by different parties on separate counterparts), each
of which shall be an original, but all of which together shall constitute one
and the same instrument.
SECTION 13.13. Third-Party Beneficiaries. This Agreement shall inure
to the benefit of and be binding upon the parties hereto, the Certificateholders
and the other Beneficiaries and their respective successors and permitted
assigns. Except as otherwise expressly provided in this Agreement, no other
Person shall have any right or obligation hereunder.
SECTION 13.14. Actions by Certificateholders. Any request, demand,
authorization, direction, notice, consent, waiver or other act by a
Certificateholder shall bind
85
such Certificateholder and every subsequent holder of any Certificate issued
upon the registration of transfer of the Certificates of such Certificateholder
or in exchange therefor or in lieu thereof in respect of anything done or
omitted to be done by the Trustee or the Servicer in reliance thereon, whether
or not notation of such action is made upon any such Certificate.
SECTION 13.15. Rule 144A Information. For so long as any of the
Investor Certificates of any Series or Class are "restricted securities" within
the meaning of Rule 144(a)(3) under the Act, each of the Seller, the Trustee,
the Servicer and any Enhancement Providers agree to cooperate with each other to
provide to any Investor Certificateholders of such Series or Class and to any
prospective purchaser of Investor Certificates designated by such an Investor
Certificateholder, upon the request of such Investor Certificateholder or
prospective purchaser, any information required to be provided to such holder or
prospective purchaser to satisfy the condition set forth in Rule 144A(d)(4)
under the Act.
SECTION 13.16. Action by Trustee. Upon any application or request by
the Seller or Servicer to the Trustee to take any action under any provision
under this Agreement, the Seller or Servicer, as the case may be, shall furnish
to the Trustee an Officer's Certificate stating that all conditions precedent,
if any, provided for in this Agreement relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
Counsel all such conditions precedent, if any, have been complied with. The
Trustee shall be entitled to conclusively rely on the Officer's Certificate or
the Opinion of Counsel, as the case may be, as authority for any action
undertaken in connection therewith.
SECTION 13.17. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement sets forth the entire understanding of the
parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived, or supplemented except as provided herein.
SECTION 13.18. Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation or
any provision hereof.
SECTION 13.19. Continued Effectiveness of the Existing Pooling and
Servicing Agreement. As amended and restated hereby, the Existing Pooling and
Servicing Agreement shall continue to be in full force and effect and is hereby
ratified and confirmed in all respects.
SECTION 13.20. Submission to Jurisdiction. Each of the parties
hereto hereby irrevocably and unconditionally: (a) submits for itself and its
property in any legal action or proceeding relating to this Agreement, any
Supplement, the Assignments, the Reassignments or the other documents executed
and delivered in connection herewith or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general jurisdiction of the
courts of the State of New York, the courts of the United States of America for
the Southern District of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to the
venue of such action or
86
proceeding in any such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to such
Person at its address determined in accordance with Section 13.6; and
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to ▇▇▇ in any other jurisdiction.
SECTION 13.21. Actions by Seller on Behalf of Trust. The Seller
shall have the right on behalf of the Trust to make any filings, reports,
notices, applications, registrations with, and to seek any consents or
authorizations from, the Securities and Exchange Commission and any State
securities authority on behalf of the Trust as may be necessary or advisable to
comply with any Federal or State securities laws or reporting requirement, and
the parties hereto hereby ratify and approve all such filings, reports, notices,
applications, registrations with, consents or authorizations made, sought or
obtained by the Seller prior to the date hereof.
87
IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee have
caused this Pooling and Servicing Agreement to be duly executed as of the day
and year first above written.
DEUTSCHE FLOORPLAN RECEIVABLES,
L.P., Seller
By: DEUTSCHE FLOORPLAN RECEIVABLES,
INC., General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: President
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
DEUTSCHE FINANCIAL SERVICES
CORPORATION, Servicer
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
THE CHASE MANHATTAN BANK,
Trustee
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Trust Officer
EXHIBIT A
[RESERVED]
A-1
EXHIBIT B
FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS
(As required by Section 2.05
of the Pooling and Servicing Agreement)
ASSIGNMENT No. OF RECEIVABLES IN ADDITIONAL ACCOUNTS dated as of , ,
among Deutsche Floorplan Receivables, L.P., as seller (the "Seller"), Deutsche
Financial Services Corporation ("DFS"), as servicer (the "Servicer"), and The
Chase Manhattan Bank, as trustee (the "Trustee"), pursuant to the Pooling and
Servicing Agreement referred to below.
W I T N E S S E T H :
WHEREAS the Seller, the Servicer and the Trustee are parties to the
Amended and Restated Pooling and Servicing Agreement dated as of April 1, 2000
(as amended, amended and restated or otherwise modified from time to time, the
"Agreement");
WHEREAS, pursuant to the Agreement, the Seller wishes to designate
Additional Accounts to be included as Accounts and to convey the Receivables and
related Collateral Security of such Additional Accounts, whether now existing or
hereafter created, to the Trust as part of the corpus of the Trust (as each such
term is defined in the Agreement); and
WHEREAS the Trustee is willing to accept such designation and
conveyance subject to the terms and conditions hereof;
NOW, THEREFORE, the Seller, the Servicer and the Trustee hereby
agree as follows:
1. Defined Terms. All capitalized terms used herein shall have
the meanings ascribed to them in the Agreement unless otherwise defined herein.
"Addition Date" shall mean, with respect to the Additional Accounts
designated hereby, ___, 20__.
2. Designation of Additional Accounts. The Seller hereby delivers
herewith a computer file or microfiche or written list containing a true and
complete list of all such Additional Accounts specifying for each such Account,
as of the Additional Cut-Off Date, its account number, the aggregate amount of
Receivables outstanding in such Account and the aggregate amount of
Principal Receivables in such Account. Such file or list shall, as of the date
of this Assignment, supplement Schedule 1 to the Agreement.
B-1
3. Conveyance of Receivables. (a) The Seller does hereby sell,
transfer, assign, set over and otherwise convey, without recourse (except as
expressly provided in the Agreement), to the Trust for the benefit of the
Certificateholders and the other Beneficiaries, all its right, title and
interest in, to and under the Receivables in such Additional Accounts and all
Collateral Security with respect thereto, owned by the Seller and existing at
the close of business on the Additional Cut-Off Date and thereafter created from
time to time until the termination of the Trust, all monies due or to become due
and all amounts received with respect thereto and all proceeds (including
"proceeds" as defined in Section 9-306 of the UCC as in effect in the State of
Missouri and Recoveries) thereof. The foregoing sale, transfer, assignment,
set-over and conveyance does not constitute and is not intended to result in the
creation or an assumption by the Trust, the Trustee, any Agent or any
Beneficiary of any obligation of the Servicer, the Seller or any other Person in
connection with the Accounts, the Receivables or under any agreement or
instrument relating thereto, including any obligation to any Dealers.
(b) In connection with such sale, the Seller agrees to record and
file, at its own expense, a financing statement on form UCC-1 (and continuation
statements when applicable) with respect to the Receivables now existing and
hereafter created for the sale of chattel paper (as defined in Section 9-105 of
the UCC as in effect in any state where the Seller's or the Servicer's chief
executive offices or books and records relating to the Receivables are located)
meeting the requirements of applicable state law in such manner and in such
jurisdictions as are necessary to perfect the sale and assignment of the
Receivables and the Collateral Security to the Trust, and to deliver a
file-stamped copy of such financing statements or other evidence of such filing
to the Trustee on or prior to the Addition Date. The Trustee shall be under no
obligation whatsoever to file such financing statement, or a continuation
statement to such financing statement, or to make any other filing under the UCC
in connection with such sales.
(c) In connection with such sale, the Seller further agrees, at
its own expense, on or prior to the Addition Date, to indicate in its computer
files that the Receivables created in connection with the Additional Accounts
designated hereby have been sold and the Collateral Security assigned to the
Trust pursuant to this Assignment for the benefit of the Certificateholders and
the other Beneficiaries.
4. Acceptance by Trustee. Subject to the satisfaction of the
conditions set forth in Section 6 of this Assignment, the Trustee hereby
acknowledges its acceptance, on behalf of the Trust, of all right, title and
interest previously held by the Seller to the property, now existing and
hereafter created, conveyed to the Trust pursuant to Section 3(a) of this
Assignment, and declares that it shall maintain such right, title and interest,
upon the trust set forth in the Agreement for the benefit of the
Certificateholders and other Beneficiaries. The Trustee further acknowledges
that, prior to or simultaneously with the execution and delivery of this
Assignment, the Seller delivered to the Trustee the computer file or microfiche
or written list relating to the Additional Accounts described in Section 2 of
this Assignment. The Trustee shall be under no obligation whatsoever to verify
the accuracy or completeness of the information contained in such file or list.
5. Representations and Warranties of the Seller. The Seller
hereby represents and warrants to the Trustee, on behalf of the Trust, as of the
date of this Assignment and as of the Addition Date that:
B-2
(a) Legal, Valid and Binding Obligation. This Assignment
constitutes a legal, valid and binding obligation of the Seller,
enforceable against the Seller in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect affecting creditors, rights in general and except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity);
(b) Organization and Good Standing. The Seller is a limited
partnership duly organized and validly existing and in good standing under
the law of the State of Delaware and has, in all material respects, full
power, authority and legal right to own its properties and conduct its
business as such properties are presently owned and such business is
presently conducted, and to execute, deliver and perform its obligations
under this Assignment.
(c) Due Qualification. The Seller is duly qualified to do business
and, where necessary, is in good standing as a foreign partnership (or is
exempt from such requirement) and has obtained all necessary licenses and
approvals in each jurisdiction in which the conduct of its business
requires such qualification except where the failure to so qualify or
obtain licenses or approvals would not have a material adverse effect on
its ability to perform its obligations hereunder;
(d) Eligible Accounts. Each Additional Account designated hereby
is an Eligible Account;
(e) Selection Procedures. No selection procedures believed by the
Seller to be adverse to the interests of the Beneficiaries were utilized
in selecting the Additional Accounts designated hereby;
(f) Insolvency. As of the Notice Date and the Addition Date,
neither DFS nor the Seller are insolvent nor, after giving effect to the
conveyance set forth in Section 3 of this Assignment, shall any of them
have been made insolvent, nor are any of them aware of any pending
insolvency;
(g) Valid Transfer. This Assignment constitutes a valid sale,
transfer and assignment to the Trust of all right, title and interest of
the Seller in the Receivables and the Collateral Security and the proceeds
thereof and upon the filing of the financing statements described in
Section 3 of this Assignment with the Secretary of State of the State of
Missouri and other applicable states and, in the case of the Receivables
and the Collateral Security hereafter created and the proceeds thereof,
upon the creation thereof, the Trust shall have a first priority perfected
ownership interest in such property, except for Liens permitted under
Section 2.6(a) of the Agreement. Except as otherwise provided in the
Pooling and Servicing Agreement, neither the Seller nor any Person
claiming through or under the Seller has any claim to or interest in the
Trust Assets;
(h) Due Authorization. The execution and delivery of this
Assignment and the consummation of the transactions provided for or
contemplated by this Assignment
B-3
have been duly authorized by the Seller by all necessary partnership
action on the part of the Seller.
(i) No Conflict. The execution and delivery of this Assignment,
the performance of the transactions contemplated by this Assignment and
the fulfillment of the terms hereof, shall not conflict with, result in
any breach of any of the material terms and provisions of, or constitute
(with or without notice or lapse of time or both) a material default
under, any indenture, contract, agreement, mortgage, deed of trust, or
other instrument to which the Seller is a party or by which it or its
properties are bound;
(j) No Violation. The execution and delivery of this Assignment by
the Seller, the performance of the transactions contemplated by this
Assignment and the fulfillment of the terms hereof applicable to the
Seller shall not conflict with or violate any material Requirements of Law
applicable to the Seller;
(k) No Proceedings. There are no proceedings or, to the best
knowledge of the Seller, investigations pending or threatened against the
Seller before any Governmental Authority (i) asserting the invalidity of
this Assignment, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Assignment, (iii) seeking any
determination or ruling that, in the reasonable judgment of the Seller,
would materially and adversely affect the performance by the Seller of its
obligations under this Assignment, (iv) seeking any determination or
ruling that would materially and adversely affect the validity or
enforceability of this Assignment or (v) seeking to affect adversely the
income tax attributes of the Trust under the United States Federal or any
State income, single business or franchise tax systems;
(l) Record of Accounts. As of the Addition Date, Schedule 1 to
this Assignment is an accurate and complete listing in all material
respects of all the Additional Accounts as of the Additional Cut-Off Date
and the information contained therein with respect to the identity of such
Accounts and the Receivables existing thereunder is true and correct in
all material respects as of the Additional Cut-Off Date;
(m) No Liens. Each Receivable and all Collateral Security existing
on the Addition Date has been conveyed to the Trust free and clear of any
Lien, except for Liens permitted under Section 2.6(a) of the Agreement;
(n) All Consents Required. With respect to each Receivable and all
Collateral Security existing on the Addition Date, all consents, licenses,
approvals or authorizations of or registrations or declarations with any
Governmental Authority required to be obtained, effected or given by the
Seller in connection with the conveyance of such Receivable or Collateral
Security to the Trust, the execution and delivery of this Assignment and
the performance of the transactions contemplated hereby have been duly
obtained, effected or given and are in full force and effect; and
(o) Eligible Receivables. On the Additional Cut-Off Date each
Receivable conveyed to the Trust as of such date is an Eligible Receivable
or, if such Receivable is
B-4
not an Eligible Receivable, such Receivable is conveyed to the Trust in
accordance with Section 2.9 of the Agreement.
6. Conditions Precedent. The acceptance of the Trustee set forth
in Section 4 of this Assignment is subject to the satisfaction, on or prior to
the Addition Date, of the following conditions precedent:
(a) Representations and Warranties. Each of the representations
and warranties made by the Seller in Section 5 of this Assignment shall be
true and correct as of the date of this Assignment and as of the Addition
Date;
(b) Agreement. Each of the conditions set forth in Section 2.5(d)
of the Agreement applicable to the designation of the Additional Accounts
to be designated hereby shall have been satisfied; and
(c) Officer's Certificate. The Seller shall have delivered to the
Trustee an Officer's Certificate, dated the date of this Assignment, in
which an officer of the Seller shall state that the representations and
warranties of the Seller under Section 5 hereof are true and correct. The
Trustee may conclusively rely on such Officers' Certificate, shall have no
duty to make inquiries with regard to the matters set forth therein and
shall incur no liability in so relying.
7. Ratification of Agreement. As supplemented by this Assignment,
the Agreement is in all respects ratified and confirmed and the Agreement as so
supplemented by this Assignment shall be read, taken and construed as one and
the same instrument.
8. Counterparts. This Assignment may be executed in two or more
counterparts (and by different parties in separate counterparts), each of which
shall be an original but all of which together shall constitute one and the same
instrument.
9. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
B-5
IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee have
caused this Assignment to be duly executed and delivered by their respective
duly authorized officers as of the day and the year first above written.
DEUTSCHE FLOORPLAN RECEIVABLES, L.P.,
Seller,
By: DEUTSCHE FLOORPLAN
RECEIVABLES, INC., General Partner
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
DEUTSCHE FINANCIAL SERVICES
CORPORATION, as Servicer
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as Trustee,
By:
--------------------------------------
Name:
Title:
B-6
EXHIBIT C
FORM OF ANNUAL SERVICER'S CERTIFICATE
(As required to be delivered on or before March 31
of each calendar year pursuant to Section 3.5 of
the Pooling and Servicing Agreement)
Deutsche Financial Services Corporation
DISTRIBUTION FINANCIAL SERVICES
FLOORPLAN MASTER TRUST
The undersigned, duly authorized representatives of Deutsche Financial
Services Corporation ("DFS"), as Servicer, pursuant to the Amended and Restated
Pooling and Servicing Agreement dated as of April 1, 2000 (as amended, amended
and restated or otherwise modified from time to time, the "Agreement"), by and
among Deutsche Floorplan Receivables, L.P., as seller, DFS, as servicer, and The
Chase Manhattan Bank, as trustee, do hereby certify that:
1. DFS is, as of the date hereof, the Servicer under the
Agreement.
2. The undersigned are Servicing Officers and are duly authorized
pursuant to the Agreement to execute and deliver this Certificate to the
Trustee, any Agent and any Enhancement Providers.
3. A review of the activities of the Servicer during the calendar
year ended December 31, , and of its performance under the Agreement was
conducted under our supervision.
4. Based on such review, the Servicer has, to the best of our
knowledge, performed in all material respects all of its obligations under
the Agreement throughout such year and no default in the performance of
such obligations has occurred or is continuing except as set forth in
paragraph 5 below.
5. The following is a description of each default in the
performance of the Servicer's obligations under the provisions of the
Agreement known to us to have been made by
the Servicer during the year ended December 31, _____, which sets forth in
detail the (a) nature of each such default, (b) the action taken by the
Servicer, if any, to remedy each such default and (c) the current status
of each such default: [If applicable, insert "None."]
Capitalized terms used but not defined herein are used as defined in the
Agreement.
C-1
IN WITNESS WHEREOF, each of the undersigned has duly executed this
Certificate this ____ day of _______, ______.
___________________________
Name:
Title:
___________________________
Name:
Title:
▇-▇
▇▇▇▇▇▇▇ ▇-▇
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "1933 ACT"). NEITHER THIS CERTIFICATE NOR ANY PORTION HEREOF MAY
BE OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE
1933 ACT AND ANY APPLICABLE PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS
OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE
TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
D-1-1
EXHIBIT D-2
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT PLAN (AS
DEFINED BELOW). */
----------------------------------------
*/ The following should be inserted in any Certificate bearing such legend:
This Certificate may not be acquired by or for the account of any
employee benefit plan, trust or account, including an individual retirement
account, that is subject to the Employee Retirement Income Security Act of 1974,
as amended, or that is described in Section 4975(e)(1) of the Internal Revenue
Code of 1986, as amended, or an entity whose underlying assets include plan
assets by reason of a plan's investment in such entity (a "Benefit Plan"). By
accepting and holding this Certificate or any interest in this Certificate, the
Holder hereof shall be deemed to have represented and warranted that it is not
funding its acquisition with the assets of any Benefit Plan.
D-2-1
EXHIBIT E
[RESERVED]
E-1
EXHIBIT F-1
[FORM OF CLEARANCE SYSTEM CERTIFICATE
TO BE GIVEN TO THE TRUSTEE BY
EUROCLEAR OR CEDEL FOR
DELIVERY OF DEFINITIVE CERTIFICATES
IN EXCHANGE FOR A PORTION OF A
TEMPORARY GLOBAL SECURITY]
DISTRIBUTION FINANCIAL SERVICES FLOORPLAN MASTER TRUST
[ %] [Floating Rate] Asset Backed Certificates, Series [ ]
[Insert title or sufficient description
of Certificates to be delivered]
We refer to that portion of the temporary Global Certificate in
respect of the above-captioned issue which is herewith submitted to be exchanged
for definitive Certificates (the "Submitted Portion") as provided in the Amended
and Restated Pooling and Servicing Agreement dated as of April 1, 2000 (as
amended, amended and restated or otherwise modified from time to time, the
"Agreement"), in respect of such issue. This is to certify that (i) we have
received a certificate or certificates, in writing or by tested telex, with
respect to each of the persons appearing in our records as being entitled to a
beneficial interest in the Submitted Portion and with respect to such persons
beneficial interest either (a) from such person, substantially in the form of
Exhibit F-2 to the Agreement, or (b) from [ ], substantially in the form of
Exhibit F-3 to the Agreement, and (ii) the Submitted Portion includes no part of
the temporary Global Certificate excepted in such certificates.
We further certify that as of the date hereof we have not received
any notification from any of the persons giving such certificates to the effect
that the statements made by them with respect to any part of the Submitted
Portion are no longer true and cannot be relied on as of the date hereof.
We understand that this certificate is required in connection with
certain securities and tax laws in the United States of America. If
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate or a copy thereof to any interested party in
such proceedings.
F-1-1
Dated: 1/
[▇▇▇▇▇▇ Guaranty Trust
Company of New York,
Brussels office, as
operator of the
Euroclear System]2/
[Centrale de Livraison
de Valeurs Mobiliere S.A.]2/
By: ____________________________
-----------------------
1/ To be dated on the Exchange Date.
2/ Delete the inappropriate reference.
F-1-2
EXHIBIT F-2
[FORM OF CERTIFICATE TO BE DELIVERED
TO EUROCLEAR OR CEDEL
BY [ ]
WITH RESPECT TO REGISTERED CERTIFICATES SOLD TO
QUALIFIED INSTITUTIONAL BUYERS]
DISTRIBUTION FINANCIAL SERVICES
FLOORPLAN MASTER TRUST,
[ %] [Floating Rate] Asset Backed Certificates, Series [ ]
In connection with the initial issuance and placement of the above
referenced Asset Backed Certificates (the "Certificates"), an institutional
investor in the United States ("institutional investor") is purchasing U.S. $
aggregate principal amount of the Certificates held in our account at [▇▇▇▇▇▇
Guaranty Trust Company of New York, Brussels office, as operator of the
Euroclear System] [Cedel S.A.] on behalf of such investor.
We reasonably believe that such institutional investor is a
qualified institutional buyer as such term is defined under Rule 144A of the
Securities and Exchange Commission under the Securities Act of 1933, as amended.
[We understand that this certificate is required in connection with
United States laws. We irrevocably authorize you to produce this certificate or
a copy hereof to any interested party in any administrative or legal proceedings
or official inquiry with respect to the matters covered by this certificate.]
The Definitive Certificates in respect of this certificate are to be
issued in registered form in the minimum denomination of U.S. $ 00,000 and such
Definitive Certificates (and, unless the Pooling and Servicing Agreement or
Supplement relating to the Certificates otherwise provides, any Certificates
issued in exchange or substitution for or on registration of transfer of
Certificates) shall bear the following legend:
"THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933. NEITHER THIS CERTIFICATE NOR ANY PORTION
HEREOF MAY BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES OR TO U.S. PERSONS (EACH AS DEFINED HEREIN), EXCEPT IN
COMPLIANCE WITH THE REGISTRATION
F-2-1
PROVISIONS OF SUCH ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM
SUCH REGISTRATION PROVISIONS. THE TRANSFER OF THIS CERTIFICATE IS
SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. THIS CERTIFICATE CANNOT BE EXCHANGED
FOR A BEARER CERTIFICATE."
Dated:
[_________________________________]
Authorized Officer
F-2-2
EXHIBIT F-3
[FORM OF CERTIFICATE TO BE DELIVERED
TO EUROCLEAR OR CEDEL BY A BENEFICIAL OWNER
OF CERTIFICATES, OTHER THAN A QUALIFIED INSTITUTIONAL BUYER]
DISTRIBUTION FINANCIAL SERVICES
FLOORPLAN MASTER TRUST
[ %] [Floating Rate] Asset Backed Certificates, Series [ ]
This is to certify that as of the date hereof and except as provided
in the third paragraph hereof, the above-captioned Certificates held by you for
our account (i) are not owned by a person that is a United States person, (ii)
are owned by a United States person that is (A) the foreign branch of a United
States financial institution (as defined in U.S. Treasury Regulations Section
1.165-12(c)(1)(v)) (a "financial institution") purchasing for its own account or
for resale, or (B) a United States person who acquired the Certificates through
the foreign branch of a financial institution and who holds the Certificates
through the financial institution on the date hereof (and in either case (A) or
(B), the financial institution hereby agrees to comply with the requirements of
Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as
amended, and the regulations thereunder), or (iii) are owned by a financial
institution for purposes of resale during the Restricted Period (as defined in
U.S. Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)) . In addition,
financial institutions described in clause (iii) of the preceding sentence
(whether or not also described in clause (i) or (ii)) certify that they have not
acquired the Certificates for purposes of resale directly or indirectly to a
United States person or to a person within the United States or its possessions.
We undertake to advise you by tested telex if the above statement as
to beneficial ownership is not correct on the date of delivery of the
above-captioned Certificates in bearer form with respect to such of said
Certificates as then appear in your books as being held for our account.
This certificate excepts and does not relate to U.S. $ principal
amount of Certificates held by you for our account, as to which we are not yet
able to certify beneficial ownership. We understand that delivery of Definitive
Certificates in such principal amount cannot be made until we are able to so
certify.
We understand that this certificate is required in connection with
certain securities and tax laws in the United States of America. If
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate or a copy thereof to any interested party in
such proceedings. As used herein, "United States" means the United States of
America (including the States and the District of Columbia), its territories,
its possessions and other areas subject to its jurisdiction; and "United States
Person" means a citizen or resident of the United States, a
F-3-1
corporation, partnership or other entity created or organized in or under the
laws of the United States, or any political subdivision thereof, or an estate or
trust the income of which is subject to United States federal income taxation
regardless of its source.
Dated: 1/ By: As, or as agent for, the
beneficial owner(s) of
the interest in the
Certificates to which
this certificate relates.
-------------------------
1/ This Certificate must be dated on the earlier of the date of the first actual
payment of interest in respect of the Certificates and the date of the delivery
of the Certificates in definitive form.
F-3-2
EXHIBIT G-1
FORM OF OPINION OF COUNSEL
Provisions to be Included in
Opinion of Counsel Delivered Pursuant
to Section 13.2(d)
(a) The Amendment to the [Pooling and Servicing Agreement]
[Supplement], attached hereto as Schedule 1 (the "Amendment"), has been duly
authorized, executed and delivered by the Seller and constitutes the legal,
valid and binding agreement of the Seller, enforceable in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally from time to time in effect. The enforceability of the Seller's
obligations is also subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
(b) The Amendment has been entered into in accordance with the
terms and provisions of Section 13.1 of the Pooling and Servicing Agreement.
G-1-1
EXHIBIT G-2
TO PSA
FORM OF OPINION OF COUNSEL
Provisions to be Included in Opinion of Counsel to be
Delivered Pursuant to Sections 2.5 and 13.2(g)(i) and (ii)(1)
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
opinion of counsel to Deutsche Floorplan Receivables, L.P. (the "Seller")
delivered on any Closing Date. Capitalized terms used but not defined herein are
used as defined in the Amended and Restated Pooling and Servicing Agreement,
dated as of April 1, 2000 (as amended, amended and restated or otherwise
modified from time to time, the "Agreement"), among the Seller, as seller,
Deutsche Financial Services Corporation, as servicer, and The Chase Manhattan
Bank, as trustee.
[(a) The Assignment has been duly authorized, executed and delivered
by the Seller, and constitutes the valid and legally binding obligation of the
Seller, enforceable against the Seller in accordance with its terms.]
(b) Assuming the Receivables [in the Additional Accounts] are
created under, and are evidenced solely by, Wholesale Financing Agreements,
Accounts Receivable Financing Agreements, or Asset Based Financing Agreements,
such Receivables shall constitute "chattel paper", "accounts" or "general
intangibles" as defined under Section 9-105 of the UCC. We note that the Seller
has given us an Officer's Certificate to the effect that the Receivables are
created under Wholesale Financing Agreements, Accounts Receivable Financing
Agreements, or Asset Based Financing Agreements.
(c) [True sale opinion regarding transfer of Receivables from DFS
to the Seller.]
(d) If the transfer of the Receivables [in the Additional
Accounts] and all [of the related] Collateral Security to the Trust pursuant to
the Pooling and Servicing Agreement constitutes a true sale of such Receivables
and Collateral Security to the Trust:
(i) with respect to such Receivables and Collateral Security
in existence on the date hereof, such sale transfers all of the
right, title and interest of the Seller in and to such Receivables
and Collateral Security to the Trust, free and clear of any liens
now existing or hereafter created, but subject to the rights of the
holder of the Deutsche FRLP Certificate and except for Liens
permitted under Section 2.6(a) of the Agreement;
(ii) with respect to such Receivables and Collateral Security
which come into existence after the date hereof, upon the creation
of such Receivables and Collateral Security and the subsequent
transfer of such Receivables and Collateral
---------------------
(1) Include bracketed language only in the case of additions of Accounts
effected pursuant to Section 2.05 of the Pooling and Servicing Agreement.
G-2-1
Security to the Trust in accordance with the Pooling and Servicing
Agreement and receipt by the Seller of the consideration therefor
required pursuant to the Pooling and Servicing Agreement, such sale
shall transfer all of the right, title and interest of the Seller in
and to such Receivables and Collateral Security to the Trust free
and clear of any liens but subject to the rights of the holder of
the Deutsche FRLP Certificate and except for Liens permitted under
Section 2.6(a) of the Agreement;
and, in either case, no further action shall thereafter be required
under Missouri or federal law to protect the Trust's ownership
interest in the Receivables and the Collateral Security against
creditors of, or subsequent purchasers from, the Seller.
(e) If the transfer of the Receivables and Collateral Security to
the Trust pursuant to the Pooling and Servicing Agreement does not constitute a
true sale of the Receivables and the Collateral Security to the Trust, then the
Pooling and Servicing Agreement as amended and supplemented by the Assignment
creates a valid security interest in favor of the Trustee, for the benefit of
the Certificateholders, in the Seller's right, title and interest in and to the
Receivables and the Collateral Security and the proceeds thereof securing the
obligations of the Seller thereunder. Financing statements on form UCC-1 having
been filed in the Offices of the Secretaries of State of the State of Missouri
and [other applicable states] [and counties) and accordingly, such security
interest constitutes a perfected security interest in such Receivables and
Collateral Security and the proceeds thereof subject to no prior liens (but
subject to the Liens permitted by Section 2.6(a) of the Agreement), enforceable
as such against creditors of, and subsequent purchasers from, the Seller,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws relating to or affecting creditors' rights generally
and to general equity principles.
G-2-2
EXHIBIT H
FORM OF REASSIGNMENT OF RECEIVABLES IN REMOVED ACCOUNTS
(As required by Section 2.7 of the Pooling and
Servicing Agreement referred to below)
REASSIGNMENT NO. OF RECEIVABLES,
dated as of , 20__, by and between DEUTSCHE FLOORPLAN
RECEIVABLES, L.P., a limited partnership organized
under the laws of the State of Delaware (the
"Seller"), and The Chase Manhattan Bank, a New York
banking corporation, as trustee (the "Trustee")
pursuant to the Pooling and Servicing Agreement
referred to below.
WITNESSETH
WHEREAS the Seller, Deutsche Financial Services Corporation, as
servicer (the "Servicer"), and the Trustee are parties to the Amended and
Restated Pooling and Servicing Agreement dated as of April 1, 2000 (as amended,
amended and restated or otherwise modified from time to time, the"Agreement");
WHEREAS, pursuant to the Agreement, the Seller wishes (a) to remove
certain Accounts (the "Removed Accounts") and (b) if and only if permitted by
Section 2.8(d) of the Agreement, to cause the Trustee to reconvey the
Receivables of such Removed Accounts and the related Collateral Security,
whether now existing or hereafter created, and all amounts currently held by the
Trust or thereafter received by the Trust in respect of such Removed Accounts,
from the Trust to the Seller (as each such term is defined in the Agreement);
and
WHEREAS the Trustee is willing to accept such removal and to
reconvey the Receivables in the Removed Accounts, such Collateral Security and
any related amounts held or received by the Trust subject to the terms and
conditions hereof.
NOW, THEREFORE, the Seller and the Trustee hereby agree as follows:
1. Defined Terms. All terms defined in the Agreement and used
herein shall have such defined meanings when used herein, unless otherwise
defined herein.
"Removal Date" shall mean, with respect to the Removed Accounts
designated hereby,
2. Notice of Removed Accounts. (a) Not less than five Business
Days prior to the Removal Date, the Seller shall furnish to the Trustee, any
Agent, any Enhancement Providers and the Rating Agencies a written notice
specifying the Determination Date (which may be the Determination Date on which
such notice is given) on which removal of one or more Accounts shall occur, such
date being a Removal Date.
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(b) On or before the fifth Business Day after the Removal Date,
the Seller shall furnish to the Trustee a computer file, microfiche list or
other list of the Removed Accounts that were removed on the Removal Date,
specifying for each Removed Account as of the date of the Removal Notice its
number, the aggregate amount outstanding in such Removed Account and the
aggregate amount of Principal Receivables therein and represent that such
computer file, microfiche list or other list of the Removed Accounts is true and
complete in all material respects.
3. Conveyance of Receivables and Accounts. (a) The Trustee does
hereby transfer, assign, set over and otherwise convey to the Seller, without
recourse, representation or warranty on and after the Removal Date, all right,
title and interest of the Trust in, to and under all [in the case of Removed
Accounts which were Ineligible Accounts at the time they were originally
designated as Accounts, use the following language: Receivables now existing at
the close of business on the Removal Date and thereafter created from time to
time until the termination of the Trust in Removed Accounts designated hereby,
all Collateral Security thereof, all monies due or to become due and all amounts
received with respect thereto (including all Non-Principal Receivables), all
proceeds (as defined in Section 9-306 of the UCC as in effect in the State of
Missouri) and Recoveries thereof relating thereto] [in the case of Removed
Accounts which were not Ineligible Accounts at the time they were originally
designated as Accounts, replace the immediately preceding bracketed text with
the following: the Removed Accounts but not any right, title and interest of the
Trust in, to and under (i) all Receivables existing at the close of business on
the Removal Date in Removed Accounts designated hereby, (ii) all Collateral
Security relating to such Receivables, (iii) all monies due or to become due and
all amounts received with respect to such Receivables (including all
Non-Principal Receivables), (iv) all proceeds (as defined in Section 9-306 of
the UCC in effect in the State of Missouri) of such Receivables and (v) all
Recoveries of such Receivables relating thereto, it being understood that the
items described in clauses (i)-(v) shall continue to be Trust Assets].
(b) If requested by the Seller, in connection with such transfer,
the Trustee agrees to execute and deliver to the Seller on or prior to the date
of this Reassignment, a termination statement under the UCC of each applicable
jurisdiction with respect to the Receivables existing at the close of business
on the Removal Date and thereafter created from time to time and Collateral
Security thereof in the Removed Accounts reassigned hereby (which may be a
single termination statement with respect to all such Receivables and Collateral
Security) evidencing the release by the Trust of its lien on the Receivables in
the Removed Accounts and the Collateral Security, and meeting the requirements
of applicable state law, in such manner and such jurisdictions as are necessary
to remove such lien.
4. Acceptance by Trustee. The Trustee hereby acknowledges that,
prior to or simultaneously with the execution and delivery of this Reassignment,
the Seller delivered to the Trustee the computer file or such microfiche or
written list described in Section 2(b) of this Reassignment.
5. Representations and Warranties of the Seller. The Seller
hereby represents and warrants to the Trustee, on behalf of the Trust, as of the
date of this Reassignment and as of the Removal Date:
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(a) Legal, Valid and Binding Obligation. This Reassignment
constitutes a legal, valid and binding obligation of the Seller,
enforceable against the Seller in accordance with its terms, except
as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights
generally and except as such enforceability may be limited by
general principles of equity (whether considered in a suit at law or
in equity);
(b) No Early Amortization Event. The removal of the Accounts
hereby removed shall not, in the reasonable belief of the Seller,
cause an Early Amortization Event to occur or cause the Pool Balance
to be less than the Required Participation Amount;
(c) Selection Procedures. No selection procedures believed
by the Seller to be adverse to the interests of the Beneficiaries
were utilized in selecting the Accounts to be removed;
(d) True and Complete List. The list of Removed Accounts
described in Section 2 of this Assignment is, as of the Removal
Commencement Date, true and complete in all material respects; and
(e) Rating of Certificates. The removal of such Accounts
shall not result in a reduction or withdrawal of the rating of any
outstanding series or Class by the applicable Rating Agency;
provided, however, that in the event that the removal on such
Removal Date relates solely to Ineligible Accounts, the Seller shall
be deemed to make only the representations and warranties contained
in paragraph 5(a) above.
6. Conditions Precedent. In addition to the conditions precedent
set forth in Section 2.7 of the Agreement, the obligation of the Trustee to
execute and deliver this Reassignment is subject to the satisfaction, on or
prior to the Removal Date, of the following additional conditions precedent:
(a) Officers' Certificate. The Seller shall have delivered to the
Trustee, any Agent, and any Enhancement Providers an Officers' Certificate
certifying that (i) as of the Removal Date, all requirements set forth in
Section 2.7 of the Agreement for removing such Accounts and reconveying the
Receivables of such Removed Accounts and the Collateral Security, whether
existing at the close of business on the Removal Date or thereafter created from
time to time until the termination of the Trust, have been satisfied, and (ii)
each of the representations and warranties made by the Seller in Section 5
hereof is true and correct as of the date of this Reassignment and as of the
Removal Date. The Trustee may conclusively rely on such Officers' Certificate,
shall have no duty to make inquiries with regard to the matters set forth
therein and shall incur no liability in so relying.
(b) The Seller shall have delivered to the Trustee, any Agent, any
Enhancement Providers and each Rating Agency a Tax Opinion, dated the Removal
Date, with respect to the removal of Accounts.
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7. Ratification of Agreement. As supplemented by this
Reassignment, the Agreement is in all respects ratified and confirmed and the
Agreement as so supplemented by this Reassignment shall be read, taken and
construed as one and the same instrument.
8. Counterparts. This Reassignment may be executed in two or more
counterparts, and by different parties on separate counterparts, each of which
shall be an original, but all of which shall constitute one and the same
instrument.
9. GOVERNING LAW. THIS REASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
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IN WITNESS WHEREOF, the undersigned have caused this Reassignment to
be duly executed and delivered by their respective duly authorized officers on
the day and year first above written.
DEUTSCHE FLOORPLAN RECEIVABLES, L.P.,
Seller,
By: DEUTSCHE FLOORPLAN
RECEIVABLES, INC., General Partner
By: ________________________________________
Name:
Title:
By: ________________________________________
Name:
Title:
THE CHASE MANHATTAN BANK, Trustee
By: ________________________________________
Name:
Title:
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Schedule 1
List of Accounts
Delivered separately to the Trustee and deemed to be incorporated
herein.
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Schedule 2
The Collection Account for the Trust has been established with The
Chase Manhattan Bank, Account #507-865677.
2