Exhibit 4.2
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WACHOVIA AUTO OWNER TRUST 200__-_,
as Issuer,
and
----------,
as Indenture Trustee
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INDENTURE
Dated as of ________, 200__
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$___________ ______% Class A-1 Asset Backed Notes
$___________ ______% Class A-2 Asset Backed Notes
$___________ ______% Class A-3 Asset Backed Notes
$___________ ______% Class A-4 Asset Backed Notes
$___________ ______% Class A-5 Asset Backed Notes
$__________ ______ % Class B Asset Backed Notes
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CROSS REFERENCE TABLE*
TIA Indenture
Section Section
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310 (a)(1)................................................... 6.11
(a)(2)................................................... 6.11
(a)(3)................................................... 6.10; 6.11
(a)(4)................................................... N.A.**
(a)(5)................................................... 6.11
(b)...................................................... 6.08; 6.11
(c)...................................................... N.A.
311 (a)...................................................... 6.12
(b)...................................................... 6.12
(c)...................................................... N.A.
312 (a)...................................................... 7.01
(b)...................................................... 7.02
(c)...................................................... 7.02
313 (a)...................................................... 7.04
(b)(1)................................................... 7.04
(b)(2)................................................... 7.04
(c)...................................................... 7.04; 11.05
(d)...................................................... 7.04
314 (a)...................................................... 3.09; 7.03
(b)...................................................... 3.06; 11.15
(c)(1)................................................... 11.01
(c)(2)................................................... 11.01
(c)(3)................................................... 11.01
(d)...................................................... 11.01
(e)...................................................... 11.01
(f)...................................................... 11.01
315 (a)...................................................... 6.01
(b)...................................................... 6.05; 11.01
(c)...................................................... 6.01
(d)...................................................... 6.01
(e)...................................................... 5.13
316 (a)...................................................... 1.01
(a)(1)(A)................................................ 5.11
(a)(1)(B)................................................ 5.12
(a)(2)................................................... N.A.
(b)...................................................... 5.07
(c)...................................................... N.A.
317 (a)(1)................................................... 5.03
(a)(2)................................................... 5.03
(b)...................................................... 3.03
318 (a)...................................................... 11.07
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* This Cross Reference Table shall not, for any purpose, be deemed to be
part of this Indenture.
** N.A. means Not Applicable. Page
TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions........................................................................................2
Section 1.02. Incorporation by Reference of Trust Indenture Act.................................................15
Section 1.03. Interpretive Provisions...........................................................................16
ARTICLE TWO
THE NOTES
Section 2.01. Form..............................................................................................17
Section 2.02. Execution, Authentication and Delivery............................................................17
Section 2.03. Temporary Notes...................................................................................18
Section 2.04. Tax Treatment.....................................................................................18
Section 2.05. Registration; Registration of Transfer and Exchange...............................................18
Section 2.06. Mutilated, Destroyed, Lost or Stolen Notes........................................................20
Section 2.07. Persons Deemed Owner..............................................................................21
Section 2.08. Payment of Principal and Interest.................................................................21
Section 2.09. Cancellation......................................................................................26
Section 2.10. Book-Entry Notes..................................................................................26
Section 2.11. Notices to Clearing Agency........................................................................27
Section 2.12. Definitive Notes..................................................................................27
Section 2.13. Release of Collateral.............................................................................27
Section 2.14. Employee Benefit Plans............................................................................27
Section 2.15. Authenticating Agents.............................................................................28
ARTICLE THREE
COVENANTS
Section 3.01. Payment of Principal and Interest.................................................................29
Section 3.02. Maintenance of Office or Agency...................................................................29
Section 3.03. Money for Payments to be Held in Trust............................................................29
Section 3.04. Existence.........................................................................................30
Section 3.05. Protection of Trust Estate........................................................................31
Section 3.06. Opinions as to Trust Estate.......................................................................31
Section 3.07. Performance of Obligations; Servicing of Receivables..............................................32
Section 3.08. Negative Covenants................................................................................34
Section 3.09. Annual Statement as to Compliance.................................................................34
Section 3.10. Issuer May Consolidate, etc., Only on Certain Terms...............................................35
Section 3.11. Successor or Transferee...........................................................................36
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Section 3.12. No Other Business.................................................................................36
Section 3.13. No Borrowing......................................................................................37
Section 3.14. Master Servicer's Obligations.....................................................................37
Section 3.15. Guarantees, Loans, Advances and Other Liabilities.................................................37
Section 3.16. Capital Expenditures..............................................................................37
Section 3.17. Removal of Administrator..........................................................................37
Section 3.18. Restricted Payments...............................................................................37
Section 3.19. Notice of Events of Default.......................................................................37
Section 3.20. Further Instruments and Acts......................................................................37
Section 3.21. Compliance with Laws..............................................................................38
Section 3.22. Amendments of Sale and Servicing Agreement and Trust Agreement....................................38
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture...........................................................39
Section 4.02. Satisfaction, Discharge and Defeasance of the Notes...............................................40
Section 4.03. Application of Trust Money........................................................................41
Section 4.04. Repayment of Monies Held by Paying Agent..........................................................41
ARTICLE FIVE
EVENTS OF DEFAULT; REMEDIES
Section 5.01. Events of Default.................................................................................42
Section 5.02. Acceleration of Maturity; Rescission and Annulment................................................43
Section 5.03. Collection of Indebtedness and Suits for Enforcement by Indenture Trustee.........................44
Section 5.04. Remedies..........................................................................................46
Section 5.05. Optional Preservation of the Receivables..........................................................47
Section 5.06. Limitation of Suits...............................................................................47
Section 5.07. Unconditional Rights of Noteholders to Receive Principal and Interest.............................48
Section 5.08. Restoration of Rights and Remedies................................................................48
Section 5.09. Rights and Remedies Cumulative....................................................................48
Section 5.10. Delay or Omission Not a Waiver....................................................................48
Section 5.11. Control by Noteholders of the Controlling Class...................................................48
Section 5.12. Waiver of Past Defaults...........................................................................49
Section 5.13. Undertaking for Costs.............................................................................49
Section 5.14. Waiver of Stay or Extension Laws..................................................................49
Section 5.15. Action on Notes...................................................................................50
Section 5.16. Performance and Enforcement of Certain Obligations................................................50
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ARTICLE SIX
THE INDENTURE TRUSTEE
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Section 6.01. Duties of Indenture Trustee.......................................................................52
Section 6.02. Rights of Indenture Trustee.......................................................................53
Section 6.03. Individual Rights of Indenture Trustee............................................................54
Section 6.04. Indenture Trustee's Disclaimer....................................................................54
Section 6.05. Notice of Defaults................................................................................54
Section 6.06. Reports by Indenture Trustee to Noteholders.......................................................54
Section 6.07. Compensation and Indemnity........................................................................54
Section 6.08. Replacement of Indenture Trustee..................................................................55
Section 6.09. Successor Indenture Trustee by Merger.............................................................56
Section 6.10. Appointment of Co-Trustee or Separate Trustee.....................................................56
Section 6.11. Eligibility; Disqualification.....................................................................58
Section 6.12. Preferential Collection of Claims Against Issuer..................................................58
Section 6.13. Representations and Warranties of Indenture Trustee...............................................58
ARTICLE SEVEN
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders............................60
Section 7.02. Preservation of Information; Communications, Reports and Certain Documents to Noteholders.........60
Section 7.03. Reports by Issuer.................................................................................60
Section 7.04. Reports by Indenture Trustee......................................................................61
ARTICLE EIGHT
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money...............................................................................62
Section 8.02. Accounts..........................................................................................62
Section 8.03. General Provisions Regarding Accounts.............................................................63
Section 8.04. Release of Trust Estate...........................................................................64
Section 8.05. Opinion of Counsel................................................................................64
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent of Noteholders............................................66
Section 9.02. Supplemental Indentures With Consent of Noteholders...............................................67
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Section 9.03. Execution of Supplemental Indentures..............................................................68
Section 9.04. Effect of Supplemental Indenture..................................................................69
Section 9.05. Conformity with Trust Indenture Act...............................................................69
Section 9.06. Reference in Notes to Supplemental Indentures.....................................................69
ARTICLE TEN
REDEMPTION OF NOTES
Section 10.01. Redemption.......................................................................................70
Section 10.02. Form of Redemption Notice........................................................................70
Section 10.03. Notes Payable on Redemption Date.................................................................71
ARTICLE ELEVEN
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions, etc........................................................72
Section 11.02. Form of Documents Delivered to Indenture Trustee.................................................73
Section 11.03. Acts of Noteholders..............................................................................74
Section 11.04. Notices, etc., to Indenture Trustee, Issuer, Depositor and Rating Agencies.......................75
Section 11.05. Notices to Noteholders; Waiver...................................................................75
Section 11.06. Alternate Payment and Notice Provisions..........................................................76
Section 11.07. Conflict with Trust Indenture Act................................................................76
Section 11.08. Effect of Headings and Table of Contents.........................................................76
Section 11.09. Successors and Assigns...........................................................................76
Section 11.10. Severability.....................................................................................77
Section 11.11. Benefits of Indenture; Third Party Beneficiaries.................................................77
Section 11.12. Legal Holidays...................................................................................77
Section 11.13. GOVERNING LAW....................................................................................77
Section 11.14. Counterparts.....................................................................................77
Section 11.15. Recording of Indenture...........................................................................77
Section 11.16. Trust Obligation.................................................................................77
Section 11.17. No Petition......................................................................................78
Section 11.18. Inspection.......................................................................................78
Section 11.19. Subordination Agreement..........................................................................78
EXHIBITS
Exhibit A - Form of Notes.......................................................................................A-1
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This Indenture, dated as of _______, 200__, is between Wachovia Auto
Owner Trust 200__-_, a Delaware statutory trust (the "Issuer"), and ________,
a national banking association, not in its individual capacity but solely as
trustee (the "Indenture Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the holders of the Issuer's ________%
Class A-1 Asset Backed Notes (the "Class A-1 Notes"), ________% Class A-2
Asset Backed Notes (the "Class A-2 Notes"), ________% Class A-3 Asset Backed
Notes (the "Class A-3 Notes"), 4.84% Class A-4 Asset Backed Notes (the "Class
A-4 Notes"), ________% Class A-5 Asset Backed Notes (the "Class A-5 Notes")
and ________% Class B Asset Backed Notes (the "Class B Notes" and, together
with the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the Class
A-4 Notes and the Class A-5 Notes, the "Notes"):
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee on the Closing Date
(with respect to each Initial Receivable) and on each Subsequent Transfer Date
(with respect to each related Subsequent Receivable) on behalf of and for the
benefit of the Noteholders, without recourse, all of the Issuer's right, title
and interest in, to and under, whether now owned or existing or hereafter
acquired or arising, (i) the Receivables, (ii) all amounts due and collected
on or in respect of the Receivables (including proceeds of the repurchase of
Receivables by the Seller pursuant to the Receivables Purchase Agreement)
after the related Cutoff Date, (iii) the security interests in the Financed
Vehicles granted by the Obligors pursuant to the Receivables, (iv) all
proceeds from claims on or refunds of premiums of any physical damage or theft
insurance policies and extended warranties covering the Financed Vehicles and
any proceeds or refunds of premiums of any credit life or credit disability
insurance policies relating to the Receivables, the Financed Vehicles or the
Obligors, (v) the Receivable Files, (vi) the Collection Account, the Note
Payment Account, the Reserve Fund, the Yield Supplement Account, the
Pre-Funding Account and the Negative Carry Account and all amounts,
securities, Financial Assets, investments and other property deposited in or
credited to any of the foregoing and all proceeds thereof, (vii) all rights of
the Depositor under the Receivables Purchase Agreement, including the right to
require the Seller to repurchase Receivables from the Depositor, (viii) any
proceeds of Dealer Recourse, (ix) all rights of the Issuer under the Sale and
Servicing Agreement, including the right to require the Seller to repurchase
or the Master Servicer to purchase Receivables from the Issuer, (x) the right
to realize upon any property (including the right to receive future Net
Liquidation Proceeds and Recoveries) that shall have secured a Receivable and
have been repossessed by or on behalf of the Issuer, (xi) all of the Issuer's
rights under each First-Tier and Second-Tier Subsequent Assignment and (xii)
all present and future claims, demands, causes of action and choses in action
in respect of any or all of the foregoing, and all payments on or under and
all proceeds of every kind and nature whatsoever in respect of any or all of
the foregoing, including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all accounts, accounts
receivable, general intangibles, chattel paper, documents, money, investment
property, deposit accounts, notes, drafts, acceptances, letters of credit,
letter of credit rights, insurance proceeds, condemnation awards, rights to
payment of any and every kind and other forms of obligations and receivables,
instruments and other property which at any time constitute all or part of or
are included in the proceeds of any of the foregoing (collectively, the
"Collateral").
The foregoing Grant is made in trust to secure the payment of
principal and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice, priority or distinction, and to
secure compliance with the provisions of this Indenture, all as provided in
this Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the
Noteholders, acknowledges such Grant, accepts the trusts under this Indenture
in accordance with the provisions of this Indenture and agrees to perform its
duties as required in this Indenture to the best of its ability to the end
that the interests of the Noteholders may be adequately and effectively
protected.
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
(a) .henever used in this Indenture, the following words and phrases,
unless the context otherwise requires, shall have the following meanings.
"Accounts" has the meaning specified in the Sale and Servicing
Agreement.
"Act" has the meaning specified in Section 11.03(a).
"Additional Servicing Fee" means, for any Collection Period, if a
Successor Servicer is appointed pursuant to Section 7.02 of the Sale and
Servicing Agreement, the amount, if any, by which (i) the compensation payable
to such Successor Servicer for such Collection Period exceeds (ii) the Monthly
Servicing Fee for such Collection Period.
"Administration Agreement" means the administration agreement, dated
as of _____, 200__, among the Administrator, the Issuer, the Depositor and the
Indenture Trustee.
"Administrator" means Wachovia Bank, in its capacity as administrator
under the Administration Agreement, and its successors in such capacity.
"Affiliate" has the meaning specified in the Sale and Servicing
Agreement.
"Aggregate Principal Distributable Amount" means, with respect to any
Distribution Date, the Priority Principal Distributable Amount, the Secondary
Principal Distributable Amount and the Regular Principal Distributable Amount.
"Authenticating Agent" has the meaning specified in Section 2.15.
"Authorized Officer" means, with respect to the Issuer, any officer
of the Owner Trustee who is authorized to act for or on behalf of the Owner
Trustee in matters relating to the Issuer and who is identified on the list of
Authorized Officers delivered by the Owner Trustee to the Indenture Trustee on
the Closing Date (as such list may be modified or supplemented from time to
time thereafter) and, for so long as the Administration Agreement is in
effect, any Vice President or more senior officer of the Administrator who is
authorized to act for the
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Administrator in matters relating to the Issuer and to be acted upon by the
Administrator pursuant to the Administration Agreement and who is identified
on the list of Authorized Officers delivered by the Administrator to the
Indenture Trustee on the Closing Date (as such list may be modified or
supplemented from time to time thereafter).
"Available Collections" has the meaning specified in the Sale and
Servicing Agreement.
"Available Funds" has the meaning specified in the Sale and Servicing
Agreement.
"Basic Documents" has the meaning specified in the Sale and Servicing
Agreement.
"Benefit Plan" means (i) employee benefit plans (as defined in
Section 3(3) of ERISA) that are subject to Title I of ERISA, (ii) plans
described in Section 4975(e)(1) of the Code, including individual retirement
accounts or ▇▇▇▇▇ Plans that are not exempt under Section 4975(g) of the Code,
and (iii) any entities whose underlying assets include plan assets by reason
of a plan's investment in such entities.
"Book-Entry Notes" means a beneficial interest in the Notes,
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.10.
"Business Day" has the meaning specified in the Sale and Servicing
Agreement.
"Certificate Payment Account" has the meaning specified in the Sale
and Servicing Agreement.
"Certificateholder" has the meaning specified in the Trust Agreement.
"Class" means a class of Notes, which may be the Class A-1 Notes,
Class A-2 Notes, Class A-3 Notes, Class A-4 Notes, Class A-5 Notes or the
Class B Notes, as the context may require.
"Class A Noteholder" means the Person in whose name a Class A Note is
registered in the Note Register.
"Class A Notes" means the Class A-1 Notes, the Class A-2 Notes, the
Class A-3 Notes, the Class A-4 Notes and the Class A-5 Notes.
"Class A Principal Distributable Amount" means, for any Distribution
Date, the amount distributable in respect of principal of the Class A-3 Notes,
the Class A-4 Notes or the Class A-5 Notes, as applicable, on such
Distribution Date, which amount shall equal the excess of (i) the sum of the
principal amounts of the Class A-3 Notes, the Class A-4 Notes and the Class
A-5 Notes as of the day preceding such Distribution Date over (ii) an amount
equal to ________% of the amount by which the Pool Balance plus the
Pre-Funding Account Amount as of the last day of the preceding Collection
Period exceeds the Overcollateralization Target Amount for that Distribution
Date; provided, however, that on (a) any Distribution Date that the Cumulative
Net Loss Percentage exceeds the related Sequential Payment Trigger (and on
each subsequent Distribution Date until the Cumulative Net Loss Percentage is
less than or equal to the related Sequential Payment Trigger for three
consecutive Distribution Dates), the Class A Principal
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Distributable Amount shall equal the lesser of (1) the Aggregate Principal
Distributable Amount (less amounts distributed to the Class A-1 Notes and
Class A-2 Notes on such Distribution Date) and (2) the Note Balance of the
Class A-3, Class A-4 and Class A-5 Notes and (b) the Final Scheduled
Distribution Date of any one or more of the Class A-3 Notes, Class A-4 Notes
or the Class A-5 Notes, as applicable, the Class A Principal Distributable
Amount for such Distribution Date (and any subsequent Distribution Date until
the principal amount of each such Class of Class A Notes has been paid in
full) will not be less than the amount that is necessary to pay the
outstanding principal amount of each such Class of Class A Notes (which amount
shall be applied first to each such Class of Class A Notes sequentially in
order of numerical designation until the principal amount of such Classes of
Class A Notes have been paid in full).
"Class A-1 Final Scheduled Distribution Date" means the ______ 20__
Distribution Date.
"Class A-1 Interest Rate" means ______% per annum (computed on the
basis of the actual number of days in the related Interest Period divided by
360).
"Class A-1 Noteholder" means the Person in whose name a Class A-1
Note is registered in the Note Register.
"Class A-1 Notes" means the ______% Class A-1 Asset Backed Notes,
substantially in the form of Exhibit A.
"Class A-2 Final Scheduled Distribution Date" means the _______ 20__
Distribution Date.
"Class A-2 Interest Rate" means ______% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).
"Class A-2 Noteholder" means the Person in whose name a Class A-2
Note is registered in the Note Register.
"Class A-2 Notes" means the ______% Class A-2 Asset Backed Notes,
substantially in the form of Exhibit A.
"Class A-3 Final Scheduled Distribution Date" means the _______ 20__
Distribution Date.
"Class A-3 Interest Rate" means ______% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).
"Class A-3 Noteholder" means the Person in whose name a Class A-3
Note is registered in the Note Register.
"Class A-3 Notes" means the ______% Class A-3 Asset Backed Notes,
substantially in the form of Exhibit A.
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"Class A-4 Final Scheduled Distribution Date" means the _______ 20__
Distribution Date.
"Class A-4 Interest Rate" means ______% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).
"Class A-4 Noteholder" means the Person in whose name a Class A-4
Note is registered in the Note Register.
"Class A-4 Notes" means the ______% Class A-4 Asset Backed Notes,
substantially in the form of Exhibit A.
"Class A-5 Final Scheduled Distribution Date" means the _______ 20__
Distribution Date.
"Class A-5 Interest Rate" means ______% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).
"Class A-5 Noteholder" means the Person in whose name a Class A-5
Note is registered in the Note Register.
"Class A-5 Notes" means the ______% Class A-5 Asset Backed Notes,
substantially in the form of Exhibit A.
"Class B Final Scheduled Distribution Date" means the _______ 20__
Distribution Date.
"Class B Interest Rate" means ______% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).
"Class B Noteholder" means the Person in whose name a Class B Note is
registered in the Note Register.
"Class B Notes" means the ______% Class B Asset Backed Notes,
substantially in the form of Exhibit A.
"Class B Principal Distributable Amount" means, for any Distribution
Date, the amount distributable in respect of principal of the Class B Notes on
such Distribution Date, which amount shall equal the excess of (i) the
principal amount of the Class B Notes as of the day preceding such
Distribution Date over (ii) an amount equal to ______% of the amount by which
the Pool Balance plus the Pre-Funding Account Amount as of the last day of the
preceding Collection Period exceeds the Overcollateralization Target Amount
for that Distribution Date; provided, however, that on (a) any Distribution
Date that the Cumulative Net Loss Percentage exceeds the related Sequential
Payment Trigger (and on each subsequent Distribution Date until the Cumulative
Net Loss Percentage is less than or equal to the related Sequential Payment
Trigger for three consecutive Distribution Dates), the Class B Principal
Distributable Amount shall equal the lesser of (1) the excess of the Aggregate
Principal Distributable Amount over the Class A Principal Distributable Amount
and (2) the Note Balance of the Class B Notes and (b) the Class B Final
Scheduled Distribution Date, the Class B Principal Distributable Amount
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for such Distribution Date (and any subsequent Distribution Date until the
principal amount of the Class B Notes has been paid in full) will not be less
than the amount that is necessary to pay the outstanding principal amount of
the Class B Notes.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act, which initially shall be
The Depository Trust Company.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with
the Clearing Agency.
"Closing Date" means ________, 200_.
"Code" means the Internal Revenue Code of 1986 and the Treasury
Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of this
Indenture.
"Collection Account" has the meaning specified in the Sale and
Servicing Agreement.
"Collection Period" means, with respect to any Distribution Date, the
immediately preceding calendar month (or, in the case of the first Collection
Period, the period from but excluding the Initial Cutoff Date to and including
the last day of the month immediately preceding the month in which the first
Distribution Date occurs).
"Commission" has the meaning specified in the Sale and Servicing
Agreement.
"Controlling Class" means the Class A Notes so long as any Class A
Notes are outstanding and thereafter the Class B Notes so long as any Class B
Notes are outstanding.
"Corporate Trust Office" means the principal office of the Indenture
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of execution of this Indenture is
located at______________________________, Attention:
______________________________, or at such other address as the Indenture
Trustee may designate from time to time by written notice to the Noteholders
and the Issuer, or the principal corporate trust office of any successor
Indenture Trustee at the address designated by such successor Indenture
Trustee by written notice to the Noteholders and the Issuer.
"Cumulative Net Loss Percentage" means, with respect to any
Distribution Date and the related Collection Period, the percentage equivalent
of a fraction, (i) the numerator of which is equal to the excess, if any, of
(a) the aggregate Principal Balance of all Receivables that became Defaulted
Receivables during such Collection Period and all prior Collection Periods (in
each case as of the day that each such Receivable became a Defaulted
Receivable) over (b) the aggregate Net Liquidation Proceeds and Recoveries
received by the Master Servicer during such Collection Period and all prior
Collection Periods and (ii) the denominator of which is the Cutoff Date Pool
Balance.
"Cutoff Date" has the meaning specified in the Sale and Servicing
Agreement.
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"Cutoff Date Pool Balance" means the sum of (i) the aggregate
principal balance of the Initial Receivables as of the Initial Cutoff Date and
(ii) the aggregate principal balance of all Subsequent Receivables as of the
related Subsequent Cutoff Date or Dates.
"Dealer Recourse" has the meaning specified in the Sale and Servicing
Agreement.
"Default" means any event that with notice or the lapse of time or
both would become an Event of Default.
"Defaulted Receivable" has the meaning specified in the Sale and
Servicing Agreement.
"Definitive Notes" has the meaning specified in Section 2.10.
"Depositor" has the meaning specified in the Trust Agreement.
"Distribution Date" means the 20th day of each month, or if such 20th
day is not a Business Day, the following business day, commencing on _______,
200_.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"Event of Default" has the meaning specified in Section 5.01.
"Excess Collections" has the meaning specified in Section
2.08(a)(xi).
"Exchange Act" means the Securities Exchange Act of 1934.
"Exchange Act Reports" has the meaning specified in the Sale and
Servicing Agreement.
"Executive Officer" means, with respect to any (i) corporation,
limited liability company or depository institution, the chief executive
officer, the chief operating officer, the chief financial officer, the
president, any Vice President, the secretary or the treasurer of such
corporation, limited liability company or depository institution and (ii)
partnership, any general partner thereof.
"Final Scheduled Distribution Date" means the Class A-1 Final
Scheduled Distribution Date, the Class A-2 Final Scheduled Distribution Date,
the Class A-3 Final Scheduled Distribution Date, the Class A-4 Final Scheduled
Distribution Date, the Class A-5 Final Scheduled Distribution Date or the
Class B Final Scheduled Distribution Date, as the context may require.
"Financed Vehicle" has the meaning specified in the Sale and
Servicing Agreement.
"Financial Asset" has the meaning specified in the Sale and Servicing
Agreement.
"Grant" means to mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create and ▇▇▇▇▇ ▇ ▇▇▇▇ upon and a
security interest in and a right of set-off against, deposit, set over and
confirm pursuant to this Indenture. A Grant of the Collateral or of any other
agreement or instrument shall include all rights, powers and options (but none
of the obligations) of the granting party thereunder, including the immediate
and continuing right to
7
claim for, collect, receive and give receipt for principal and interest
payments in respect of the Collateral and all other monies payable thereunder,
to give and receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options, to bring Proceedings in the
name of the granting party or otherwise, and generally to do and receive
anything that the granting party is or may be entitled to do or receive
thereunder or with respect thereto.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Note Register.
"Indenture" means this Indenture.
"Indenture Trustee" means ____________, a national banking
association, as Indenture Trustee under this Indenture, and any successor in
such capacity.
"Independent" means, when used with respect to any specified Person,
that the Person (i) is in fact independent of the Issuer, any other obligor on
the Notes, the Depositor, the Seller, the Master Servicer and any of their
respective Affiliates, (ii) does not have any direct financial interest or any
material indirect financial interest in the Issuer, any such other obligor,
the Depositor, the Seller, the Master Servicer or any of their respective
Affiliates and (iii) is not connected with the Issuer, any such other obligor,
the Depositor, the Seller, the Master Servicer or any of their respective
Affiliates as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions.
"Independent Certificate" means a certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01, made
by an Independent appraiser or other expert appointed by an Issuer Order and
approved by the Indenture Trustee in the exercise of reasonable care, and such
opinion or certificate shall state that the signer has read the definition of
"Independent" in this Indenture and that the signer is Independent within the
meaning thereof.
"Initial Cutoff Date" has the meaning specified in the Sale and
Servicing Agreement.
"Initial Receivable" has the meaning set forth in the Sale and
Servicing Agreement.
"Insurance Proceeds" has the meaning set forth in the Sale and
Servicing Agreement.
"Interest Carryover Shortfall Amount" means, with respect to any
Distribution Date and a Class of Notes, the excess, if any, of the Interest
Distributable Amount for that Class of Notes on the immediately preceding
Distribution Date over the amount in respect of interest that is actually
deposited in the Note Payment Account with respect to that Class of Notes on
that preceding Distribution Date, plus, to the extent permitted by applicable
law, interest on the amount of interest due but not paid to such Noteholders
on that preceding Distribution Date at the applicable Interest Rate.
"Interest Distributable Amount" means, with respect to any
Distribution Date and a Class of Notes, the sum of the Monthly Interest
Distributable Amount and the Interest Carryover Shortfall Amount for that
Class of Notes for that Distribution Date.
8
"Interest Period" means, with respect to any Distribution Date and
the (i) Class A-1 Notes, the period from, and including, the prior
Distribution Date (or from, and including, the Closing Date with respect to
the first Distribution Date) to, but excluding, the current Distribution Date
and (ii) Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes, the Class
A-5 Notes and the Class B Notes, the period from, and including the 20th day
of the month of the prior Distribution Date (or from, and including, the
Closing Date with respect to the first Distribution Date) to, but excluding,
the 20th day of the month of the current Distribution Date (assuming each
month has 30 days).
"Interest Rate" means the Class A-1 Interest Rate, the Class A-2
Interest Rate, the Class A-3 Interest Rate, the Class A-4 Interest Rate, the
Class A-5 Interest Rate and the Class B Interest Rate, as applicable.
"Issuer" means Wachovia Auto Owner Trust 200__-_ until a successor
replaces it and, thereafter, means the successor and, for purposes of any
provision contained herein and required by the TIA, each other obligor on the
Notes.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Issuer by any Authorized Officer of the Issuer and
delivered to the Indenture Trustee by the Administrator, if signed by an
officer of the Administrator, or at the written direction of the Depositor, if
signed by an officer of the Owner Trustee.
"Maryland Vehicle Sales Finance Act" means Maryland Code Annotated,
Financial Institutions ss.11-401 et seq.
"Master Servicer" means Wachovia Bank, in its capacity as master
servicer under the Sale and Servicing Agreement and its successors in such
capacity.
"Monthly Interest Distributable Amount" means, with respect to any
Distribution Date and any Class of Notes, the interest due on that Class of
Notes for the related Interest Period calculated based on the Interest Rate
for that Class of Notes and the principal amount of that Class of Notes on the
preceding Distribution Date, after giving effect to all payments of principal
to such Noteholders on or prior to that Distribution Date, or, in the case of
the first Distribution Date, on the original principal amount of that Class of
Notes.
"Monthly Servicing Fee" has the meaning specified in the Sale and
Servicing Agreement.
"Monthly Trustee Fees" means the monthly fees payable to each of the
Trustees on each Distribution Date for the related Collection Period for
performing their respective obligations under the Basic Documents.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Negative Carry Account" has the meaning set forth in the Sale and
Servicing Agreement.
"Net Liquidation Proceeds" has the meaning specified in the Sale and
Servicing Agreement.
9
"Nonrecoverable Advance" has the meaning specified in the Sale and
Servicing Agreement.
"Note Balance" means, at any time, the aggregate principal amount of
all Notes that are Outstanding at such time or the aggregate principal amount
of all Notes of the Controlling Class or a particular Class that are
Outstanding at such time, as the context requires.
"Note Depository Agreement" means the agreement, dated the Closing
Date, among the Issuer, the Indenture Trustee and The Depository Trust
Company, as the initial Clearing Agency, relating to the Notes.
"Note Owner" means, with respect to any Book-Entry Note, the Person
who is the beneficial owner of such Book-Entry Note, as reflected on the books
of the Clearing Agency or on the books of a Person maintaining an account with
such Clearing Agency (directly as a Clearing Agency Participant or as an
indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Note Payment Account" has the meaning specified in the Sale and
Servicing Agreement.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.05(a).
"Notes" means the Class A-1 Notes, the Class A-2 Notes, the Class A-3
Notes, the Class A-4 Notes, the Class A-5 Notes and the Class B Notes.
"Obligor" has the meaning specified in the Sale and Servicing
Agreement.
"Officer's Certificate" means a certificate signed by any Authorized
Officer of the Issuer, under the circumstances described in, and otherwise
complying with, the applicable requirements of 11.01, and delivered to the
Indenture Trustee. Unless otherwise specified, any reference in this Indenture
to an Officer's Certificate shall be to an Officer's Certificate of the
Issuer.
"Opinion of Counsel" means one or more written opinions of counsel
who may, except as otherwise expressly provided in this Indenture, be an
employee of, or outside counsel to, the Issuer, the Depositor, the Seller or
the Master Servicer and who shall be acceptable to the Indenture Trustee, and
which opinion or opinions shall be addressed to the Indenture Trustee, shall
comply with any applicable requirements of Section 11.01 and shall be in form
and substance satisfactory to the Indenture Trustee.
"Outstanding" means, as of the date of determination, all Notes
theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore canceled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money
in the necessary amount has been theretofore deposited with the
Indenture Trustee or any Paying Agent in
10
trust for the Noteholders; provided, however, that if such Notes are
to be redeemed, notice of such redemption must have been duly given
pursuant to this Indenture or provision for such notice must have
been made in a manner satisfactory to the Indenture Trustee; and
(iii) Notes in exchange for or in lieu of which other Notes
have been authenticated and delivered pursuant to this Indenture
unless proof satisfactory to the Indenture Trustee is presented that
any such Notes are held by a Protected Purchaser;
provided, however, that in determining whether the Noteholders of the
requisite principal amount of the Notes Outstanding have given any request,
demand, authorization, direction, notice, consent or waiver hereunder or under
any other Basic Document, Notes owned by the Issuer, any other obligor upon
the Notes, the Depositor, the Seller, the Master Servicer or any of their
respective Affiliates shall be disregarded and deemed not to be Outstanding
unless all of the Notes of the related Class or Classes are owned by the
Issuer, any other obligor upon the Notes, the Depositor, the Seller, the
Master Servicer or any of their respective Affiliates, except that, in
determining whether the Indenture Trustee shall be protected in relying on any
such request, demand, authorization, direction, notice, consent or waiver,
only Notes that a Responsible Officer of the Indenture Trustee knows to be so
owned shall be so disregarded. Notes so owned that have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Indenture Trustee the pledgee's right so to act with
respect to such Notes and that the pledgee is not the Issuer, any other
obligor upon the Notes, the Depositor, the Seller, the Master Servicer or any
of their respective Affiliates.
"Overcollateralization Target Amount" means, with respect to any
Distribution Date, an amount equal to ______% of the Pool Balance as of the
last day of the related Collection Period but in no event less than ______% of
the Cutoff Date Pool Balance.
"Owner Trustee" has the meaning specified in the Trust Agreement.
"PASS" has the meaning specified in the Receivables Purchase
Agreement.
"Paying Agent" means the Indenture Trustee or any other Person that
meets the eligibility standards specified in Section 6.11 and is authorized by
the Issuer to make payments to and distributions from the Collection Account,
the Note Payment Account, the Certificate Payment Account, the Yield
Supplement Account, the Negative Carry Account, the Pre-Funding Account and
the Reserve Fund, including payments of principal or interest on the Notes on
behalf of the Issuer. The Indenture Trustee shall be the initial Paying Agent
hereunder.
"Pennsylvania Motor Vehicle Sales Finance Act" means 69 P.S. ss. 601
et seq.
"Permitted Investments" has the meaning specified in the Sale and
Servicing Agreement.
"Person" has the meaning specified in the Sale and Servicing
Agreement.
"Pool Balance" has the meaning specified in the Sale and Servicing
Agreement.
11
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced
by such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.06 in lieu of a mutilated, lost,
destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.
"Pre-Funding Account" has the meaning specified in the Sale and
Servicing Agreement.
"Pre-Funding Account Amount" has the meaning set forth in the Sale
and Servicing Agreement.
"Principal Balance" has the meaning specified in the Sale and
Servicing Agreement.
"Priority Principal Distributable Amount" means, with respect to any
Distribution Date, the excess, if any, of the Note Balance of the Class A
Notes as of such Distribution Date (before giving effect to any payments made
to Noteholders on that Distribution Date) over the sum of the Pool Balance as
of the last day of the preceding Collection Period and any Pre-Funding Account
Amount as of the last day of the preceding Collection Period; provided,
however, that the Priority Principal Distributable Amount for each
Distribution Date on or after the Final Scheduled Distribution Date for any
Class of Class A Notes shall equal the greater of (i) the amount otherwise
calculated pursuant to this definition and (ii) the outstanding principal
balance of such Class of Class A Notes as of the day preceding such
Distribution Date.
"Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.
"Protected Purchaser" has the meaning specified in Section 8-303 of
the UCC.
"PTCE" means Prohibited Transaction Class Exemption.
"Purchased Receivable" has the meaning specified in the Sale and
Servicing Agreement.
"Rating Agency" means Moody's or Standard & Poor's; provided,
however, that if Moody's and Standard & Poor's cease to exist, Rating Agency
shall mean any nationally recognized statistical rating organization or other
comparable Person designated by the Issuer, written notice of which
designation shall have been given to the Depositor, the Master Servicer and
the Trustees.
"Rating Agency Condition" means, with respect to any action, that
each Rating Agency shall have been given ten days (or such shorter period as
is acceptable to each Rating Agency) prior notice thereof and that each Rating
Agency shall have notified the Depositor, the Master Servicer and the Trustees
in writing that such action will not result in a qualification, reduction or
withdrawal of the then-current rating assigned by such Rating Agency to any
Class of Notes.
"Receivable" has the meaning specified in the Receivables Purchase
Agreement.
"Receivable Files" has the meaning specified in the Sale and
Servicing Agreement.
12
"Receivables Purchase Agreement" means the receivables purchase
agreement, dated as of ______, 200_, between the Seller and PASS, as
purchaser.
"Record Date" shall mean, with respect to the Notes and any
Distribution Date or Redemption Date, the close of business on the Business
Day preceding such Distribution Date or Redemption Date, provided, however,
that if Definitive Notes have been issued pursuant to Section 2.12, Record
Date shall mean, with respect to any Distribution Date or Redemption Date, the
last day of the preceding Collection Period.
"Recoveries" has the meaning specified in the Sale and Servicing
Agreement.
"Redemption Date" means, in the case of a redemption of the Notes
pursuant to Section 10.01, the Distribution Date specified by the Master
Servicer pursuant to such Section.
"Redemption Price" means, in the case of a redemption of the Notes
pursuant to Section 10.01, an amount equal to the unpaid principal amount of
the Notes redeemed plus accrued and unpaid interest thereon through the
related Interest Period at the related Interest Rates.
"Regular Principal Distributable Amount" means, with respect to any
Distribution Date, an amount equal to the excess, if any, of (i) the lesser of
(a) the Note Balance of all Notes as of such Distribution Date (before giving
effect to any payments made to Noteholders on that Distribution Date) and (b)
the excess, if any, of (1) the sum of the Note Balance of all Notes as of such
Distribution Date (before giving effect to any payments made to Noteholders on
that Distribution Date) and the Overcollateralization Target Amount over (2)
the Pool Balance as of the last day of the related Collection Period plus any
Pre-Funding Account Amount as of the last day of the related Collection
Period, over (ii) the sum of the Priority Principal Distributable Amount and
the Secondary Principal Distributable Amount, if any.
"Reserve Fund" has the meaning specified in the Sale and Servicing
Agreement.
"Reserve Fund Deficiency" has the meaning specified in the Sale and
Servicing Agreement.
"Reserve Fund Draw Amount" has the meaning specified in the Sale and
Servicing Agreement.
"Responsible Officer" has the meaning specified in the Sale and
Servicing Agreement.
"Sale and Servicing Agreement" means the sale and servicing
agreement, dated as of ________, 200_, among the Issuer, the Depositor, the
Seller and the Master Servicer.
"Secondary Principal Distributable Amount" means, with respect to any
Distribution Date, (i) the excess, if any, of (a) the sum of the Note Balance
of all Notes as of such Distribution Date (before giving effect to any
payments made to Noteholders on that Distribution Date), over (b) the Pool
Balance as of the last day of the preceding Collection Period plus any
Pre-Funding Account Amount as of the last day of such Collection Period, over
(ii) the Priority Principal Distributable Amount, if any, for such
Distribution Date; provided, however, that the
13
Secondary Principal Distributable Amount for each Distribution Date on or
after the Class B Final Scheduled Distribution Date shall equal the greater of
(i) the amount otherwise calculated pursuant to this definition and (ii) the
Note Balance of the Class B Notes as of the day preceding such Distribution
Date.
"Securities Act" means the Securities Act of 1933.
"Securityholders" has the meaning specified in the Sale and Servicing
Agreement
"Seller" has the meaning specified in the Receivables Purchase
Agreement.
"Sequential Payment Trigger" means, with respect to a Distribution
Date, the percentage listed below for that Distribution Date.
Sequential
Payment Sequential
Distribution Date Trigger Distribution Date Payment Trigger
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% ________ 20__ ____%
________ 20__ ____% On and after ____ 20__ ____%
________ 20__ ____%
"Servicer Termination Event" has the meaning specified in the Sale
and Servicing Agreement.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
Division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"State" means any of the 50 states of the United States or the
District of Columbia.
"Subsequent Receivable" has the meaning specified in the Sale and
Servicing Agreement.
"Subsequent Transfer Date" has the meaning specified in the Sale and
Servicing Agreement.
"Successor Servicer" has the meaning specified in the Sale and
Servicing Agreement.
14
"Total Servicing Fee" has the meaning specified in the Sale and
Servicing Agreement.
"Total Trustee Fees" means, for any Collection Period and the related
Distribution Date, with respect to each of the Trustees, the sum of (i) the
Monthly Trustee Fees for such Collection Period and (ii) all accrued but
unpaid Monthly Trustee Fees for the previous Collection Period.
"Transition Costs" has the meaning specified in the Sale and
Servicing Agreement.
"Treasury Regulations" has the meaning specified in the Trust
Agreement.
"Trust Agreement" means the amended and restated trust agreement,
dated as of ______, 200_, between the Depositor and the Owner Trustee.
"Trust Estate" means all money, instruments, rights, and other
property that are subject or intended to be subject to the lien and security
interest of this Indenture for the benefit of the Noteholders (including all
property and interests Granted to the Indenture Trustee), including all
proceeds thereof.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939
as in force on the date hereof, unless otherwise specifically provided.
"Trustees" means the Owner Trustee and the Indenture Trustee.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction.
"United States" means the United States of America.
"Vice President" has the meaning specified in the Sale and Servicing
Agreement.
"Wachovia Bank" has the meaning specified in the Sale and Servicing
Agreement.
(b) Except as otherwise specified herein or as the context may
otherwise require, for all purposes of this Indenture, capitalized terms used
herein that are not otherwise defined shall have the meanings ascribed thereto
in the Sale and Servicing Agreement or the Trust Agreement, as the case may
be.
Section 1.02. .Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, that provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture
Trustee.
15
"obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined in the
TIA, defined by TIA reference to another statute or defined by Commission rule
have the meaning assigned to them by such definitions.
Section 1.03. Interpretive Provisions. With respect to all terms in
this Indenture, unless the context otherwise requires: (i) a term has the
meaning assigned to it; (ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted accounting
principles as in effect from time to time in the United States; (iii) "or" is
not exclusive; (iv) "including" means including without limitation; (v) words
in the singular include the plural and words in the plural include the
singular; (vi) any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein; (vii) references to a Person are also to its successors
and permitted assigns; (viii) the words "hereof", "herein" and "hereunder" and
words of similar import when used in this Indenture shall refer to this
Indenture as a whole and not to any particular provision of this Indenture;
(ix) references contained in this Indenture to Section, Schedule and Exhibit,
as applicable, are references to Sections, Schedules and Exhibits in or to
this Indenture unless otherwise specified; (x) references to "writing" include
printing, typing, lithography and other means of reproducing words in a
visible form; and (xi) the term "proceeds" has the meaning set forth in the
applicable UCC.
16
ARTICLE TWO
THE NOTES
Section 2.01. Form.
(a) The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes,
the Class A-4 Notes, the Class A-5 Notes and the Class B Notes, in each case
together with the Indenture Trustee's certificate of authentication, shall be
in substantially the form set forth in Exhibit A, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon as may,
consistently herewith, be determined by the officers executing such Notes, as
evidenced by their execution of the Notes. Any portion of the text of any Note
may be set forth on the reverse thereof, with an appropriate reference thereto
on the face of the Note.
(b) Definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without
steel engraved borders), all as determined by the Authorized Officers
executing such Notes, as evidenced by their execution of such Notes.
(c) Each Note shall be dated the date of its authentication. The
terms of the Notes as set forth in Exhibit A are part of the terms of this
Indenture and are incorporated herein by reference.
Section 2.02. Execution, Authentication and Delivery.
(a) The Notes shall be executed on behalf of the Issuer by any of its
Authorized Officers. The signature of any such Authorized Officer on the Notes
may be manual or facsimile. Notes bearing the manual or facsimile signature of
individuals who were at any time Authorized Officers of the Issuer shall bind
the Issuer, notwithstanding that such individuals or any of them have ceased
to hold such offices prior to the authentication and delivery of such Notes or
did not hold such offices on the date of such Notes.
(b) The Indenture Trustee shall, upon Issuer Order, authenticate and
deliver for original issue the following aggregate principal amounts of Notes:
(i) $________ of Class A-1 Notes, (ii) $________0 of Class A-2 Notes, (iii)
$________ of Class A-3 Notes, (iv) $________0 of Class A-4 Notes, (v)
$________ of Class A-5 Notes and (vi) $________ of Class B Notes. The
aggregate principal amount of Class A-1 Notes, Class A-2 Notes, Class A-3
Notes, Class A-4 Notes, Class A-5 Notes and Class B Notes Outstanding at any
time may not exceed such respective amounts except as provided in Section
2.06.
(c) Each Note shall be dated the date of its authentication. The
Notes shall be issuable as registered Notes in minimum denominations of $2,000
and in integral multiples of $1,000 in excess thereof.
(d) No Note shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication
17
substantially in the form provided for herein executed by the Indenture
Trustee by the manual signature of one of its authorized signatories, and such
certificate upon any Note shall be conclusive evidence, and the only evidence,
that such Note has been duly authenticated and delivered hereunder.
Section 2.03. Temporary Notes.
(a) Pending the preparation of Definitive Notes pursuant to Section
2.12, the Issuer may execute, and upon receipt of an Issuer Order the
Indenture Trustee shall authenticate and deliver, temporary Notes that are
printed, lithographed, typewritten, mimeographed or otherwise produced, of the
tenor of the Definitive Notes in lieu of which they are issued and with such
variations not inconsistent with the terms of this Indenture as the officers
executing such Notes may determine, as evidenced by their execution of such
Notes.
(b) If temporary Notes are issued pursuant to this Section, the
Issuer shall cause Definitive Notes to be prepared without unreasonable delay.
After the preparation of Definitive Notes, the temporary Notes shall be
exchangeable for Definitive Notes upon surrender of the temporary Notes at the
office or agency of the Note Registrar to be maintained as provided in Section
3.02, without charge to the related Noteholder. Upon surrender for
cancellation of any one or more temporary Notes, the Issuer shall execute, and
the Indenture Trustee shall authenticate and deliver in exchange therefor, a
like tenor and principal amount of Definitive Notes of authorized
denominations. Until so exchanged, the temporary Notes shall in all respects
be entitled to the same benefits under this Indenture as Definitive Notes.
Section 2.04. Tax Treatment. The Issuer has entered into this
Indenture, and the Notes will be issued, with the intention that, for all
purposes including federal, State and local income, single business and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Trust Estate. The Issuer, by entering into this Indenture, and
each Noteholder, by its acceptance of a Note (and each Note Owner by its
acceptance of an interest in the applicable Book-Entry Note), agree to treat
the Notes as indebtedness of the Issuer for all purposes, including federal,
State and local income, single business and franchise tax purposes.
Section 2.05. Registration; Registration of Transfer and Exchange.
(a) The Issuer shall cause to be kept a register (the "Note
Register") in which, subject to such reasonable regulations as it may
prescribe, the Issuer shall provide for the registration of Notes and the
registration of transfers of Notes. Wachovia Bank initially shall be the
registrar (the "Note Registrar") for the purpose of registering Notes and
transfers of Notes as herein provided. Upon any resignation of any Note
Registrar, the Issuer shall promptly appoint a successor or, if it elects not
to make such an appointment, assume the duties of Note Registrar.
(b) If a Person other than the Indenture Trustee or Wachovia Bank is
appointed by the Issuer as Note Registrar, the Issuer will give the Indenture
Trustee prompt written notice of the appointment of such Note Registrar and of
the location, and any change in the location, of the Note Register, and the
Indenture Trustee shall have the right to inspect the Note Register at all
reasonable times and to obtain copies thereof,
18
as to the names and addresses of the Holders of the Notes and the principal
amounts and number of such Notes.
(c) Upon surrender for registration of transfer of any Note at the
office or agency of the Issuer to be maintained as provided in Section 3.02,
provided that the requirements of Section 8-401 of the UCC are met, the Issuer
shall execute, and the Indenture Trustee shall authenticate and deliver to the
Noteholder making such surrender and the Noteholder shall obtain from the
Indenture Trustee, in the name of the designated transferee or transferees,
one or more new Notes of the same Class in any authorized denomination and a
like aggregate principal amount. The Indenture Trustee may rely upon the
Administrator with respect to the determination of whether the requirements of
Section 8-401 of the UCC are met.
(d) At the option of the related Holder, Notes may be exchanged for
other Notes of the same Class in any authorized denominations, of a like
aggregate principal amount, upon surrender of the Notes to be exchanged at
such office or agency. Whenever any Notes are so surrendered for exchange,
provided that the requirements of Section 8-401 of the UCC are met (as
determined by the Issuer), the Issuer shall execute, and the Indenture Trustee
shall authenticate and deliver to the Noteholder making such exchange, the
Notes which such Noteholder is entitled to receive. The Indenture Trustee may
rely upon the Administrator with respect to the determination of whether the
requirements of Section 8-401 of the UCC are met.
(e) All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes
surrendered upon such registration of transfer or exchange.
(f) Each Note presented or surrendered for registration of transfer
or exchange shall be duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Indenture Trustee duly
executed by, the Holder thereof or such Holder's attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar.
(g) No service charge shall be made to a Holder for any registration
of transfer or exchange of Notes, but the Issuer or the Indenture Trustee may
require payment by such Noteholder of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Notes, other than exchanges pursuant
to Section 2.03 or 9.06 not involving any transfer.
(h) The preceding provisions of this Section notwithstanding, the
Issuer shall not be required to make, and the Note Registrar need not
register, transfers or exchanges of Notes with respect to which the due date
for any payment will occur within 15 days.
(i) Each Person to whom a Note is transferred will be required to
represent, in the case of a Definitive Note, or deemed to represent, in the
case of a Book-Entry Note, that (i) such Person is not a Benefit Plan or (ii)
such Person is acquiring a Class A Note and the Person's acquisition, holding
and disposition of the Note are and will be eligible for relief under PTCE
84-14, 90-1, 91-38, 95-60 or 96-23.
19
Section 2.06. Mutilated, Destroyed, Lost or Stolen Notes.
(a) If (i) any mutilated Note is surrendered to the Indenture
Trustee, or the Indenture Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, (ii) there is delivered to the
Indenture Trustee such security or indemnity as may be required by it to hold
the Issuer and the Indenture Trustee harmless and (iii) the requirements of
Section 8-405 of the UCC are met, then, in the absence of notice to the
Issuer, the Note Registrar or the Indenture Trustee that such Note has been
acquired by a Protected Purchaser, the Issuer shall execute, and upon its
request the Indenture Trustee shall authenticate and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Note, a
replacement Note of the same Class; provided, however, that if any such
destroyed, lost or stolen Note, but not a mutilated Note, shall have become or
within seven days of the Indenture Trustee's receipt of evidence to its
satisfaction of such destruction, loss or theft shall be due and payable, or
shall have been called for redemption pursuant to Section 10.01, instead of
issuing a replacement Note, the Issuer may pay such destroyed, lost or stolen
Note when so due or payable or upon the Redemption Date without surrender
thereof. The Indenture Trustee may rely upon the Administrator with respect to
the determination of whether the requirements of Section 8-405 of the UCC are
met. If, after the delivery of such replacement Note or payment of a
destroyed, lost or stolen Note pursuant to the proviso to the preceding
sentence, a Protected Purchaser of the original Note in lieu of which such
replacement Note was issued presents for payment such original Note, the
Issuer and the Indenture Trustee shall be entitled to recover such replacement
Note (or such payment) from the Person to whom such replacement Note was
delivered or any Person taking such replacement Note from such Person to whom
such replacement Note was delivered or any assignee of such Person, except a
Protected Purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Issuer or the Indenture Trustee in connection therewith.
(b) Upon the issuance of any replacement Note under this Section, the
Issuer or the Indenture Trustee may require the payment by the Holder of such
Note of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other reasonable expenses
(including the fees and expenses of the Indenture Trustee or the Note
Registrar) connected therewith.
(c) Every replacement Note issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute
an original additional contractual obligation of the Issuer, whether or not
the mutilated, destroyed, lost or stolen Note shall be at any time enforceable
by anyone, and shall be entitled to all the benefits of this Indenture equally
and proportionately with any and all other Notes duly issued hereunder.
(d) The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Notes.
Section 2.07. Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and
any of their respective agents may, subject to Section 2.06, treat the Person
in whose name such Note is registered in the Note Register (as of the day of
determination) as the owner of such Note for the purpose of receiving
20
payments of principal of and interest, if any, on such Note and for all other
purposes whatsoever, whether or not such Note shall be overdue, and none of
the Issuer, the Indenture Trustee or any of their respective agents shall be
affected by any notice to the contrary.
Section 2.08. Payment of Principal and Interest.
(a) On each Distribution Date, upon receipt of written instructions
from the Master Servicer pursuant to Section 4.06(c) of the Sale and Servicing
Agreement, the Indenture Trustee shall apply the Available Funds to make the
following payments and deposits in the following order of priority:
(i) to the Master Servicer, the Total Servicing Fee and any
Nonrecoverable Advances for the related Collection Period;
(ii) to the Trustees pro rata, the Total Trustee Fees,
provided; however, that the aggregate amount to be paid to the
Trustees for such fees and expenses pursuant to this clause shall not
exceed $100,000 in any given calendar year;
(iii) to the Note Payment Account, for payment of interest
on each Class of Class A Notes, the Interest Distributable Amount for
each Class of Class A Notes;
(iv) to the Note Payment Account, for payment of principal
on the Notes in the priority set forth in Section 2.08(b), the
Priority Principal Distributable Amount, if any;
(v) to the Note Payment Account, for payment of interest on
the Class B Notes, the Interest Distributable Amount for the Class B
Notes;
(vi) to the Note Payment Account, for payment of principal
on the Notes in the priority set forth in Section 2.08(b), the
Secondary Principal Distributable Amount, if any;
(vii) to the Reserve Fund, the Reserve Fund Deficiency, if
any;
(viii) to the Note Payment Account, for payment of principal
on the Notes, the Regular Principal Distributable Amount, if any;
(ix) if a Successor Servicer has been appointed pursuant to
Section 7.02 of the Sale and Servicing Agreement, to such Successor
Servicer, any Transition Costs due in connection with such transfer
of servicing and not paid pursuant to Section 7.01 of the Sale and
Servicing Agreement, plus the Additional Servicing Fee, if any, for
the related Collection Period;
(x) to the Trustees, pro rata, the Total Trustee Fees, to
the extent that they have not previously been paid; and
(xi) unless the Notes have been declared immediately due and
payable following an Event of Default, to the Certificate Payment
Account, for payment to the Certificateholders, or if the Notes have
been declared immediately due and payable
21
following an Event of Default, to the Note Payment Account, for
payment to the Noteholders, any remaining Available Funds (the
"Excess Collections").
Notwithstanding the foregoing, following the occurrence and during
the continuation of an Event of Default which has resulted in an acceleration
of the Notes, all Available Funds shall be deposited into the Note Payment
Account and applied in accordance with Section 2.08(f). Any distributions to
be made by the Indenture Trustee under the Basic Documents may be made by the
Paying Agent.
If the amount on deposit in the Note Payment Account (including any
portion of the Reserve Fund Draw Amount) on any Distribution Date is less than
the amount described in clause (iii) above for such Distribution Date, the
Indenture Trustee, either directly or through the Paying Agent, shall pay the
available amount to the Noteholders of each Class of Class A Notes pro rata
based on the Interest Distributable Amount payable to such Class on such
Distribution Date.
If on any Distribution Date, the aggregate amount on deposit in the
Collection Account, the Yield Supplement Account, the Negative Carry Account
and the Reserve Fund equals or exceeds the Note Balance of all Notes
Outstanding as of the last day of the related Collection Period, the accrued
and unpaid interest thereon and all amounts due to the Master Servicer and the
Trustees, all such amounts will be applied to retire the Notes and pay all
such amounts due to the Master Servicer and the Trustees in accordance with
the provisions of this Section.
(b) The principal of each Note shall be payable in installments on
each Distribution Date in an aggregate amount (unless the Notes have been
declared immediately due and payable following an Event of Default) for all
Classes of Notes equal to the Aggregate Principal Distributable Amount. On
each Distribution Date, upon receipt of instructions from the Master Servicer
pursuant to Section 4.06(c) of the Sale and Servicing Agreement and subject to
Section 2.08(f), the Indenture Trustee shall either directly or through a
Paying Agent apply or cause to be applied the amount on deposit in the Note
Payment Account on such Distribution Date in respect of the Aggregate
Principal Distributable Amount, to make the following payments in the
following order of priority:
(i) to the Class A-1 Noteholders, until the principal amount
of the Class A-1 Notes has been paid in full;
(ii) to the Class A-2 Noteholders, until the principal
amount of the Class A-2 Notes has been paid in full;
(iii) following payment in full of the Class A-2 Notes,
sequentially to the remaining Class A Noteholders, the Class A
Principal Distributable Amount (applying such Class A Principal
Distributable Amount first to the Class A-3 Noteholders until the
principal amount of the Class A-3 Notes has been paid in full, then
to the Class A-4 Noteholders until the principal amount of the Class
A-4 Notes has been paid in full and then to the Class A-5 Noteholders
until the principal amount of the Class A-5 Notes has been paid in
full) until the principal amount of the Class A Notes has been paid
in full; and
22
(iv) following payment in full of the Class A Principal
Distributable Amount to the Class A Noteholders, to the Class B
Noteholders, the Class B Principal Distributable Amount until the
principal amount of the Class B Notes has been paid in full.
In addition, on the Distribution Date following the Collection Period
in which the Pre-Funding Period ends, any funds remaining on deposit in the
Pre-Funding Account as of the end of the Pre-Funding Period will be deposited
into the Collection Account for further deposit into the Note Payment Account
without deduction and distributed to Noteholders as an additional payment of
principal (i) in the priority described above, to the extent such remaining
funds are less than $5,000,000 or (ii) pro rata to each Class of Notes based
on the aggregate initial principal balance of each Class of Notes (and, to the
extent that the outstanding principal amounts of one or more Classes of Class
A Notes have been reduced to zero prior to such Distribution Date or will be
reduced to zero with a portion of the funds allocated to pay principal of such
Class or Classes of Class A Notes pursuant to this clause, such unused funds
will be distributed, pro rata, to the remaining Classes of Class A Notes based
on the aggregate initial principal balance of each remaining Class of Class A
Notes), to the extent such remaining funds are equal to or greater than
$5,000,000.
(c) If on any Distribution Date, the Cumulative Net Loss Percentage
exceeds the related Sequential Payment Trigger, then on such Distribution Date
and on each following Distribution Date until the Cumulative Net Loss
Percentage is less than or equal to the related Sequential Payment Trigger for
three consecutive Distribution Dates, all principal payments on the Notes will
be allocated sequentially, starting with the Class of Notes with the highest
alphabetical designation then outstanding (and, with respect to the Class A
Notes, sequentially, beginning with the Class A-1 Notes or the Class of Class
A Notes at that time with the lowest numerical designation) until that Class
of Notes has been paid in full. Further, the unpaid principal amount, to the
extent not previously paid of the (i) Class A-1 Notes shall be due and payable
on the Class A-1 Final Scheduled Distribution Date, (ii) Class A-2 Notes shall
be due and payable on the Class A-2 Final Scheduled Distribution Date, (iii)
Class A-3 Notes shall be due and payable on the Class A-3 Final Scheduled
Distribution Date, (iv) Class A-4 Notes shall be due and payable on the Class
A-4 Final Scheduled Distribution Date, (v) Class A-5 Notes, shall be due and
payable on the Class A-5 Final Scheduled Distribution Date and (vi) Class B
Notes shall be due and payable on the Class B Final Scheduled Distribution
Date.
(d) Each Class of Notes shall accrue interest during each Interest
Period at the related Interest Rate, and such interest shall be due and
payable on each Distribution Date. Interest on the Class A-1 Notes shall be
calculated on the basis of the actual number of days elapsed and a 360-day
year. Interest on the Class A-2 Notes, the Class A-3 Notes, the Class A-4
Notes, the Class A-5 Notes and the Class B Notes shall be calculated on the
basis of a 360-day year of twelve 30-day months. Subject to Section 3.01, any
installment of interest or principal, if any, payable on any Note that is
punctually paid or duly provided for on the applicable Distribution Date shall
be paid to the Person in whose name such Note (or one or more Predecessor
Notes) is registered on the related Record Date by check mailed first-class
postage prepaid to such Person's address as it appears on the Note Register on
such Record Date; provided, however, that, unless Definitive Notes have been
issued pursuant to Section 2.12, with respect to Notes registered on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
23
nominee to be Cede & Co.), payment shall be made by wire transfer in
immediately available funds to the account designated by such nominee, and
except for the final installment of principal payable with respect to such
Note on a Distribution Date or on the related Final Scheduled Distribution
Date (and except for the Redemption Price for any Note called for redemption
in whole pursuant to Section 10.01), which shall be payable as provided below.
The funds represented by any such checks returned undelivered shall be held in
accordance with Section 3.03. The Indenture Trustee, either directly or
through the Paying Agent, shall pay all Interest Distributable Amounts for any
Distribution Date to the Noteholders on the related Record Date even if a
portion of such Interest Distributable Amount relates to an earlier
Distribution Date.
(e) All principal and interest payments on a Class of Notes shall be
made pro rata to the Noteholders of such Class. Except as otherwise provided
herein, the Indenture Trustee shall, before the Distribution Date on which the
Issuer expects to pay the final installment of principal of and interest on
any Note, notify the Holder of such Note as of the related Record Date of such
final installment. Such notice shall be mailed or transmitted by facsimile and
shall specify that such final installment shall be payable only upon
presentation and surrender of such Note and shall specify the place where such
Note may be presented and surrendered for payment of such installment. Notices
in connection with redemption of Notes shall be sent by mail to Noteholders as
provided in Section 10.02.
(f) Notwithstanding the foregoing, the unpaid principal amount of the
Notes shall be due and payable, to the extent not previously paid, on the date
on which an Event of Default shall have occurred and be continuing, if the
Indenture Trustee or the Holders of Notes evidencing not less than 51% of the
Note Balance of the Controlling Class have declared the Notes to be
immediately due and payable in the manner provided in Section 5.02(a). On each
Distribution Date following acceleration of the Notes, upon receipt of
instructions from the Master Servicer pursuant to Section 4.06(c) of the Sale
and Servicing Agreement, the Indenture Trustee or the Paying Agent shall
deposit all Available Funds into the Note Payment Account and shall apply or
cause to be applied all such amounts to make the following payments and
deposits in the following order of priority:
(i) first, to the Master Servicer, the Total Servicing Fee
and any Nonrecoverable Advances for the related Collection Period;
(ii) second, to the Trustees, the Total Trustee Fees;
(iii) third, on a pro rata basis, to the Class A
Noteholders, the Interest Distributable Amount for each Class of the
Class A Notes;
(iv) (a) fourth, if an Event of Default described in Section
5.01(i), (ii), (v) or (vi) has occurred, in the following order of
priority:
(A) to the Class A-1 Noteholders, payments of
principal until the principal amount of the Class A-1 Notes
has been paid in full;
(B) to the Holders of each Class of remaining Class
A Notes, pro rata based on the outstanding principal amount
of each such Class of Class A Notes as
24
of such Distribution Date, payments of principal until the
principal amount of each such Class of remaining Class A
Notes has been paid in full;
(C) to the Class B Noteholders, the Interest
Distributable Amount for the Class B Notes; and
(D) to the Class B Noteholders, payments of
principal until the principal amount of the Class B Notes
has been paid in full;
(iv)(b) fourth, if an Event of Default described in Section
5.01(iii) or (iv) has occurred, in the following order of priority:
(A) to the Class B Noteholders, the Interest
Distributable Amount for the Class B Notes;
(B) to the Class A-1 Noteholders, payments of
principal until the principal amount of the Class A-1 Notes
has been paid in full;
(C) to the Holders of each Class of remaining Class
A Notes, pro rata based on the outstanding principal amount
of each such Class of Class A Notes as of such Distribution
Date, payments of principal until the principal amount of
each such Class of remaining Class A Notes has been paid in
full; and
(D) to the Class B Noteholders, payments of
principal until the principal amount of the Class B Notes
has been paid in full;
(v) fifth, if a Successor Servicer has been appointed
pursuant to Section 7.02 of the Sale and Servicing Agreement, to such
Successor Servicer, any Transition Costs due in connection with such
transfer of servicing and not paid pursuant to Section 7.01 of the
Sale and Servicing Agreement plus the Additional Servicing Fee, if
any, for the related Collection Period; and
(vi) sixth, to the Certificateholders, any remaining
amounts.
(g) The Indenture Trustee shall transfer or shall cause to be
transferred, amounts from the Reserve Fund, the Yield Supplement Account, the
Negative Carry Account and the Pre-Funding Account and deposit amounts
transferred therefrom at the written direction of the Master Servicer in
accordance with the Sale and Servicing Agreement.
Section 2.09. Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption in whole pursuant to Section
10.01 shall, if surrendered to any Person other than the Indenture Trustee, be
delivered to the Indenture Trustee and shall be promptly cancelled by the
Indenture Trustee. The Issuer may at any time deliver to the Indenture Trustee
for cancellation any Notes previously authenticated and delivered hereunder
which the Issuer may have acquired in any manner whatsoever, and all Notes so
delivered shall be promptly cancelled by the Indenture Trustee. No Notes shall
be authenticated in lieu of or in exchange for any Notes cancelled as provided
in this Section, except as expressly permitted by this Indenture. All
cancelled Notes may be held or disposed of by the Indenture Trustee in
accordance with its
25
standard retention or disposal policy as in effect at the time unless the
Issuer shall direct by an Issuer Order that they be destroyed or returned to
it; provided, that such Issuer Order is timely and the Notes have not been
previously disposed of by the Indenture Trustee.
Section 2.10. Book-Entry Notes. The Notes, upon original issuance,
will be issued in the form of a typewritten Note or Notes representing the
Book-Entry Notes, to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Issuer. The Book-Entry Notes shall
be registered initially on the Note Register in the name of Cede & Co., the
nominee of the initial Clearing Agency, and no Note Owner will receive a
definitive Note representing such Note Owner's interest in such Note, except
as provided in Section 2.12. Unless and until definitive, fully registered
Notes (the "Definitive Notes") have been issued to such Note Owners pursuant
to Section 2.12:
(i) the provisions of this Section shall be in full force
and effect;
(ii) the Note Registrar and the Indenture Trustee shall be
entitled to deal with the Clearing Agency for all purposes of this
Indenture (including the payment of principal of and interest on the
Notes and the giving of instructions or directions hereunder) as the
sole Holder of the Notes, and shall have no obligation to the Note
Owners;
(iii) to the extent that the provisions of this Section
conflict with any other provisions of this Indenture, the provisions
of this Section shall control;
(iv) the rights of Note Owners shall be exercised only
through the Clearing Agency and shall be limited to those established
by law and agreements between such Note Owners and the Clearing
Agency or the Clearing Agency Participants; pursuant to the Note
Depository Agreement, unless and until Definitive Notes are issued
pursuant to Section 2.12, the Clearing Agency will make book-entry
transfers among the Clearing Agency Participants and receive and
transmit payments of principal of and interest on the Notes to such
Clearing Agency Participants; and
(v) whenever this Indenture requires or permits actions to
be taken based upon instructions or directions of the Holders of
Notes (or Holders of Notes of any Class, including the Controlling
Class) evidencing a specified percentage of the Note Balance, the
Clearing Agency shall be deemed to represent such percentage only to
the extent that it has received instructions to such effect from Note
Owners and/or Clearing Agency Participants owning or representing,
respectively, such required percentage of the beneficial interest in
the Notes or such Class of Notes and has delivered such instructions
to the Indenture Trustee.
Section 2.11. Notices to Clearing Agency. Whenever a notice or other
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to such Note Owners pursuant to
Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to be given to the Noteholders to the Clearing
Agency, and shall have no obligation to such Note Owners.
Section 2.12. Definitive Notes. If (i)(a) the Administrator advises
the Indenture Trustee in writing that the Clearing Agency is no longer willing
or able to properly discharge its respon-
26
sibilities with respect to the Book-Entry Notes and (b) neither the Indenture
Trustee nor the Administrator is able to locate a qualified successor or (ii)
after the occurrence of an Event of Default or a Servicer Termination Event,
owners of Book-Entry Notes representing beneficial interests aggregating not
less than 51% of the principal amount of a Class of Notes advise the Indenture
Trustee and the Clearing Agency Participant through the Clearing Agency, in
writing that the continuation of a book-entry system through the Clearing
Agency is no longer in the best interests of such Note Owners, then, in each
case, the Indenture Trustee shall notify such Note Owners of the related Class
of Notes through the Clearing Agency of the occurrence of any such event and
of the availability of Definitive Notes of the related Class of Notes to Note
Owners requesting the same. Upon surrender to the Indenture Trustee of the
Note or Notes representing the Book-Entry Notes by the Clearing Agency,
accompanied by registration instructions, the Issuer at its own expense shall
execute and deliver the Definitive Notes to the Indenture Trustee and the
Indenture Trustee shall authenticate the Definitive Notes in accordance with
the instructions of the Clearing Agency. None of the Issuer, the Note
Registrar or the Indenture Trustee shall be liable for any delay in delivery
of such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Notes of a
Class, the Indenture Trustee shall recognize the Noteholders of the Definitive
Notes as Noteholders hereunder.
Section 2.13. Release of Collateral. Subject to Section 11.01 and the
terms of the other Basic Documents, the Indenture Trustee shall release
property from the lien of this Indenture only upon receipt of an Issuer
Request accompanied by an Officer's Certificate, an Opinion of Counsel and
Independent Certificates in accordance with Sections 314(c) and 314(d)(1) of
the TIA or an Opinion of Counsel in lieu of such Independent Certificates to
the effect that the TIA does not require any such Independent Certificates. If
the Commission shall issue an exemptive order under TIA Section 304(d)
modifying the Indenture Trustee's obligations under TIA Sections 314(c) and
314(d)(1), the Indenture Trustee shall release property from the lien of this
Indenture in accordance with the conditions and procedures set forth in such
exemptive order.
Section 2.14. Employee Benefit Plans. The Class B Notes may not be
acquired by a Benefit Plan. Each Person acquiring a Class B Note is deemed to
represent that such Person is not a Benefit Plan. A fiduciary of a Benefit
Plan purchasing the Class A Notes, or a beneficial interest in Class A Notes,
with the assets of a Benefit Plan is deemed to represent that the purchase of
one or more Class A Notes or a beneficial interest therein is consistent with
its fiduciary duties under ERISA and does not result in a nonexempt prohibited
transaction as defined in Section 406 of ERISA or Section 4975 of the Code. If
the Depositor, the Seller, the Master Servicer, the Indenture Trustee, the
Owner Trustee or any of their respective Affiliates (i) has investment or
administrative discretion with respect to the assets of a Benefit Plan, (ii)
has authority or responsibility to give, or regularly gives, investment advice
with respect to such Benefit Plan assets, for a fee and pursuant to an
agreement or understanding that such advice will (a) serve as a primary basis
for investment decisions with respect to such Benefit Plan assets and (b) be
based on the particular investment needs for such Benefit Plan or (iii) is an
employer maintaining or contributing to such Benefit Plan, then a purchase of
the Class A Notes by such a Benefit Plan may represent a conflict of interest
or act of self-dealing by the fiduciary.
Section 2.15. Authenticating Agents. The Indenture Trustee may
appoint one or more Persons (each, an "Authenticating Agent") with power to
act on its behalf and subject to its
27
direction in the authentication of Notes in connection with issuance,
transfers and exchanges under Sections 2.02, 2.03, 2.05 and 2.06, as fully to
all intents and purposes as though each such Authenticating Agent had been
expressly authorized by those Sections to authenticate such Notes. For all
purposes of this Indenture, the authentication of Notes by an Authenticating
Agent pursuant to this Section shall be deemed to be the authentication of
Notes "by the Indenture Trustee".
Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any entity resulting from
any merger, consolidation or conversion to which any Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of any Authenticating Agent, shall be the
successor of such Authenticating Agent hereunder, without the execution or
filing of any document or any further act on the part of the parties hereto or
such Authenticating Agent or such successor corporation.
Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustees. The Indenture Trustee may at any time
terminate the agency of any Authenticating Agent by giving written notice of
termination to such Authenticating Agent and the Owner Trustee. Upon receiving
such notice of resignation or upon such a termination, the Indenture Trustee
may appoint a successor Authenticating Agent and shall give written notice of
any such appointment to the Owner Trustee.
The Administrator agrees to pay to each Authenticating Agent from
time to time, reasonable compensation for its services. The provisions of
Sections 2.09 and 6.04 shall be applicable to any Authenticating Agent.
28
ARTICLE THREE
COVENANTS
Section 3.01. Payment of Principal and Interest. The Issuer will duly
and punctually pay the principal of and interest, if any, on the Notes in
accordance with the terms of the Notes and this Indenture. Amounts properly
withheld under the Code by any Person from a payment to any Noteholder of
interest or principal shall be considered as having been paid by the Issuer to
such Noteholder for all purposes of this Indenture.
Section 3.02. Maintenance of Office or Agency. The Issuer will
maintain in the Borough of Manhattan, The City of New York, an office or
agency where Notes may be surrendered for registration of transfer or
exchange, and where notices and demands to or upon the Issuer in respect of
the Notes and this Indenture may be served. The Issuer shall give prompt
written notice to the Depositor and the Indenture Trustee of the location, and
of any change in the location, of any such office or agency. If at any time
the Issuer shall fail to maintain any such office or agency or shall fail to
furnish the Indenture Trustee with the address thereof, such surrenders,
notices and demands may be made or served at the Corporate Trust Office.
Section 3.03. Money for Payments to be Held in Trust.
(a) As provided in Section 8.02, all payments of amounts due and
payable with respect to any Notes that are to be made from amounts withdrawn
from the Accounts shall be made on behalf of the Issuer by the Indenture
Trustee or by the Paying Agent, and no amounts so withdrawn from the Accounts
for payments of Notes shall be paid over to the Issuer except as provided in
this Section.
(b) On or before each Distribution Date and Redemption Date, the
Issuer shall deposit or cause to be deposited in the Note Payment Account an
aggregate sum sufficient to pay the amounts then becoming due under the Notes,
such sum to be held in trust for the benefit of the Persons entitled thereto,
and (unless the Paying Agent is the Indenture Trustee) shall promptly notify
the Indenture Trustee in writing of its action or failure so to act.
(c) The Issuer will cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee an instrument in which
such Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions
of this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due
with respect to the Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by the
Issuer (or any other obligor upon the Notes) of which it has actual
knowledge in the making of any payment required to be made with
respect to the Notes;
29
(iii) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee, forthwith
pay to the Indenture Trustee all sums so held in trust by such Paying
Agent;
(iv) immediately resign as a Paying Agent and forthwith pay
to the Indenture Trustee all sums held by it in trust for the payment
of the Notes if at any time it ceases to meet the standards required
to be met by a Paying Agent at the time of its appointment; and
(v) comply with all requirements of the Code and any State
or local tax law with respect to the withholding from any payments
made by it on any Notes of any applicable withholding taxes imposed
thereon and with respect to any applicable reporting requirements in
connection therewith.
(d) The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by
Issuer Order direct any Paying Agent to pay to the Indenture Trustee all sums
held in trust by such Paying Agent, such sums to be held by the Indenture
Trustee upon the same trusts as those upon which such sums were held by such
Paying Agent; and upon such payment by any Paying Agent to the Indenture
Trustee, such Paying Agent shall be released from all further liability with
respect to such sums.
(e) Subject to applicable laws with respect to escheat of funds, any
money held by the Indenture Trustee or any Paying Agent in trust for the
payment of any amount due with respect to any Note and remaining unclaimed for
two years after such amount has become due and payable shall be discharged
from such trust and be paid to the Issuer on Issuer Request; and such
Noteholder shall thereafter, as an unsecured general creditor, look only to
the Issuer for payment thereof (but only to the extent of the amounts so paid
to the Issuer), and all liability of the Indenture Trustee or such Paying
Agent with respect to such trust money shall thereupon cease; provided,
however, that the Indenture Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense and written
direction of the Issuer cause to be published once, in a newspaper published
in the English language, customarily published on each Business Day and of
general circulation in The City of New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less
than 30 days from the date of such publication, any unclaimed balance of such
money then remaining will be repaid to or for the account of the Issuer. The
Indenture Trustee shall also adopt and employ, at the expense and written
direction of the Issuer, any other reasonable means of notification of such
repayment (including mailing notice of such repayment to Holders whose Notes
have been called but have not been surrendered for redemption in whole
pursuant to Section 10.01 or whose right to or interest in monies due and
payable but not claimed is determinable from the records of the Indenture
Trustee or of any Paying Agent, at the last address of record for each such
Holder).
Section 3.04. Existence. The Issuer will keep in full effect its
existence, rights and franchises as a statutory trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other State or of the United States,
in which case the Issuer will keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and will obtain and
preserve its qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the
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validity and enforceability of this Indenture, the Notes, the Collateral and
each other instrument or agreement included in the Trust Estate, including all
licenses required under (i) the Maryland Vehicle Sales Finance Act or (ii) the
Pennsylvania Motor Vehicle Sales Finance Act in connection with this Indenture
and the other Basic Documents and the transactions contemplated hereby and
thereby until such time as the Issuer shall terminate in accordance with the
terms hereof.
Section 3.05. Protection of Trust Estate. The Issuer intends the
security interest Granted pursuant to this Indenture in favor of the Indenture
Trustee on behalf of the Noteholders to be prior to all other liens in respect
of the Trust Estate, and the Issuer shall take all actions necessary to obtain
and maintain, for the benefit of the Indenture Trustee on behalf of the
Noteholders, a first lien on and a first priority, perfected security interest
in the Trust Estate. The Issuer will from time to time authorize, execute and
deliver all such supplements and amendments hereto and all such financing
statements, continuation statements, instruments of further assurance and
other instruments, all as prepared by the Administrator and delivered to the
Issuer, and will take such other action necessary or advisable to:
(i) Grant more effectively any portion of the Trust Estate;
(ii) maintain or preserve the lien and security interest
(and the priority thereof) created by this Indenture or carry out
more effectively the purposes hereof;
(iii) perfect, publish notice of or protect the validity of
any Grant made or to be made by this Indenture;
(iv) enforce any of the Collateral; or
(v) preserve and defend title to the Trust Estate and the
rights of the Indenture Trustee and the Noteholders in such Trust
Estate against the claims of all Persons.
The Issuer hereby authorizes the Indenture Trustee to file any financing
statement or continuation statement required pursuant to this Section and
designates the Indenture Trustee as its agent and attorney-in-fact to execute
any other instrument required under this Section.
Section 3.06. Opinions as to Trust Estate.
(a) On the Closing Date, the Issuer shall furnish to the Indenture
Trustee an Opinion of Counsel to the effect that, in the opinion of such
counsel, either (i) all financing statements and continuation statements have
been executed and filed that are necessary to create and continue the
Indenture Trustee's first priority perfected security interest in the
Collateral for the benefit of the Noteholders, and reciting the details of
such filings or referring to prior Opinions of Counsel in which such details
are given or (ii) no such action shall be necessary to perfect such security
interest.
(b) Within 90 days after the beginning of each fiscal year of the
Issuer beginning with the first fiscal year beginning more than three months
after the Cutoff Date, the Issuer shall furnish to the Indenture Trustee an
Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording, filing, re-recording and
refiling
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of this Indenture, any indentures supplemental hereto and any other requisite
documents and with respect to the authorization and filing of any financing
statements and continuation statements as is necessary to maintain the lien
and security interest created by this Indenture and reciting the details of
such action or stating that in the opinion of such counsel no such action is
necessary to maintain such lien an security interest. Such Opinion of Counsel
shall also describe the recording, filing, re-recording and refiling of this
Indenture, any indentures supplemental hereto and any other requisite
documents and the authorization and filing of any financing statements and
continuation statements that shall, in the opinion of such counsel, be
required to maintain the lien and security interest of this Indenture until
March 31 in the following calendar year.
Section 3.07. Performance of Obligations; Servicing of Receivables.
(a) The Issuer will not take any action and will use its best efforts
not to permit any action to be taken by others that would release any Person
from any of such Person's material covenants or obligations under any
instrument or agreement included in the Trust Estate or that would result in
the amendment, hypothecation, subordination, termination or discharge of, or
impair the validity or effectiveness of, any such instrument or agreement,
except as expressly provided in this Indenture or the other Basic Documents.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer's Certificate of
the Issuer shall be deemed to be action taken by the Issuer. Initially, the
Issuer has contracted with the Master Servicer and the Administrator to assist
the Issuer in performing its duties under this Indenture.
(c) The Issuer will and will cause the Administrator to, punctually
perform and observe all of its obligations and agreements contained in this
Indenture, the other Basic Documents and in the instruments and agreements
included in the Trust Estate, including filing or causing to be filed all UCC
financing statements and continuation statements required to be filed by the
terms of this Indenture and the other Basic Documents in accordance with and
within the time periods provided for herein and therein.
(d) If the Issuer shall have knowledge of the occurrence of a
Servicer Termination Event, the Issuer shall promptly notify the Depositor,
the Indenture Trustee and each Rating Agency in writing of such event, and
shall specify in such notice the action, if any, the Issuer is taking in
respect of such default. If a Servicer Termination Event shall arise from the
failure of the Master Servicer to perform any of its duties or obligations
under the Sale and Servicing Agreement with respect to the Receivables, the
Issuer shall take all reasonable steps available to it to remedy such failure.
(e) As promptly as possible after the giving of notice of termination
to the Master Servicer of the Master Servicer's rights and powers pursuant to
Section 7.01 of the Sale and Servicing Agreement, the Issuer may (subject to
the rights of the Indenture Trustee to direct such appointment pursuant to
Section 7.02 of the Sale and Servicing Agreement) appoint a Successor
Servicer, and such Successor Servicer shall accept its appointment by a
written assumption in a form acceptable to the Indenture Trustee. In the event
that a Successor Servicer has not been appointed and has not accepted its
appointment at the time when the Master Servicer ceases to
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act as Master Servicer, the Indenture Trustee without further action shall be
the successor to the Master Servicer in all respects in accordance with
Section 7.02 of the Sale and Servicing Agreement. The Indenture Trustee may
resign as the Successor Servicer by giving written notice of such resignation
to the Issuer and the Depositor and in such event will be released from such
duties and obligations, such release not to be effective until the date a new
Master Servicer enters into a servicing agreement as provided below. In each
case of either the appointment of the Indenture Trustee (or any Affiliate as
provided below) as Successor Servicer, or resignation of the Indenture Trustee
as Servicer, the Indenture Trustee shall provide to the Depositor, in writing,
such information as reasonably requested by the Depositor to comply with its
reporting obligation under the Exchange Act with respect to a Successor
Servicer or the resignation of the Master Servicer. Upon delivery of any such
notice to the Issuer, the Issuer shall obtain a new Master Servicer as the
Successor Servicer. Any Successor Servicer other than the Indenture Trustee
shall (i) be an established financial institution having a net worth of not
less than $50,000,000 and whose regular business includes the servicing of
retail motor vehicle installment sale contracts, (ii) enter into a servicing
agreement with the Issuer and the Depositor having substantially the same
provisions as the provisions of the Sale and Servicing Agreement applicable to
the Master Servicer and (iii) shall provide to the Depositor, in writing, such
information as reasonably requested by the Depositor to comply with its
reporting obligation under the Exchange Act with respect to a successor Master
Servicer.. If within 30 days after the delivery of the notice referred to
above, the Issuer shall not have obtained such a new Master Servicer, the
Indenture Trustee may appoint, or may petition a court of competent
jurisdiction to appoint, a Successor Servicer. In connection with any such
appointment, the Indenture Trustee may make such arrangements for the
compensation of such successor as it and such successor shall agree with,
subject to the limitations set forth below and in the Sale and Servicing
Agreement, and in accordance with Section 7.02 of the Sale and Servicing
Agreement, the Issuer shall enter into an agreement with such successor for
the servicing of the Receivables (such agreement to be in form and substance
satisfactory to the Indenture Trustee). If the Indenture Trustee shall succeed
to the duties of the Master Servicer as provided herein, it shall do so in its
individual capacity and not in its capacity as Indenture Trustee and,
accordingly, except as otherwise provided in the proviso to Section 6.01(a),
the provisions of Article Six shall be inapplicable to the Indenture Trustee
in its duties as the successor to the Master Servicer and the servicing of the
Receivables. In case the Indenture Trustee shall become successor to the
Master Servicer under the Sale and Servicing Agreement, the Indenture Trustee
shall be entitled to appoint as Master Servicer any one of its Affiliates or
agents; provided that the Indenture Trustee, in its capacity as Master
Servicer, shall be fully liable for the actions and omissions of such
Affiliate or agent in such capacity as Successor Servicer. Notwithstanding any
other provisions of this Indenture to the contrary, in no event shall the
Indenture Trustee be liable for any servicing fee or for any differential in
the amount of the servicing fee paid under the Sale and Servicing Agreement
and the amount necessary to induce any Successor Servicer to act as Successor
Servicer under the Sale and Servicing Agreement.
(f) The Issuer shall promptly notify the Depositor, the Trustees and
the Rating Agencies in writing of (i) any termination of the Master Servicer
pursuant to the Sale and Servicing Agreement and (ii) the appointment of each
Successor Servicer, including the name and address of such Successor Servicer.
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(g) The Issuer shall not waive timely performance or observance by
the Depositor, the Master Servicer or the Seller of their respective duties or
obligations under the Basic Documents if such waiver would reasonably be
expected to materially adversely affect the Noteholders.
Section 3.08. Negative Covenants. For so long as any Notes are
Outstanding, the Issuer shall not:
(i) except as expressly permitted by Section 3.10(b) and the
Basic Documents, sell, transfer, exchange or otherwise dispose of any
of the properties or assets of the Issuer, including those included
in the Trust Estate, unless directed to do so in writing by the
Indenture Trustee;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than
amounts properly withheld from such payments under the Code or
applicable state law) or assert any claim against any present or
former Noteholder by reason of the payment of the taxes levied or
assessed upon the Issuer;
(iii) (a) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien created by this
Indenture to be amended, hypothecated, subordinated, terminated or
discharged, or permit any Person to be released from any covenants or
obligations with respect to the Notes under this Indenture except as
may be expressly permitted hereby, (b) permit any lien, charge,
excise, claim, security interest, mortgage or other encumbrance
(other than the lien of this Indenture) to be created on or extend to
or otherwise arise upon or burden the Trust Estate or any part
thereof or any interest therein or the proceeds thereof (other than
tax liens, mechanics' liens and other liens that arise by operation
of law, in each case on any of the Financed Vehicles and arising
solely as a result of an action or omission of the related Obligor)
or (c) permit the lien created by this Indenture not to constitute a
valid first priority (other than with respect to any such tax,
mechanics' or other lien) security interest in the Trust Estate;
(iv) dissolve or liquidate in whole or in part;
(v) engage in any activities other than those permitted by
Section 2.03 of the Trust Agreement and financing, acquiring, owning,
pledging and managing the Receivables as contemplated by the Basic
Documents and activities incidental to such activities; or
(vi) incur, assume or guarantee any indebtedness other than
the indebtedness evidenced by the Notes or indebtedness otherwise
permitted by the Basic Documents.
Section 3.09. Annual Statement as to Compliance. The Issuer will
deliver to the Depositor and the Indenture Trustee, on or before June 30 of
each year (commencing with the June 30 that is at least six months after the
Closing Date), an Officer's Certificate stating, as to the Authorized Officer
signing such Officer's Certificate, that:
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(a) a review of the activities of the Issuer during the
preceding year (or such shorter period in the case of the first such
Officer's Certificate) and of its performance under this Indenture
has been made under such Authorized Officer's supervision; and
(b) to the best of such Authorized Officer's knowledge,
based on such review, the Issuer has complied with all conditions and
covenants under this Indenture throughout the preceding year (or such
shorter period in the case of the first such Officer's Certificate)
or, if there has been a default in its compliance with any such
condition or covenant, specifying each such default known to such
Authorized Officer and the nature and status thereof.
Section 3.10. Issuer May Consolidate, etc., Only on Certain Terms.
(a) The Issuer shall not consolidate or merge with or into any other
Person, unless:
(i) the Person formed by or surviving such consolidation or
merger shall be a Person organized and existing under the laws of the
United States or any State and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the
Indenture Trustee, in form satisfactory to the Depositor and the
Indenture Trustee, the due and punctual payment of the principal of
and interest on all Notes and the performance or observance of every
agreement and covenant of this Indenture, and each other Basic
Document, on the part of the Issuer to be performed or observed;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee) to
the effect that such transaction will not have any material adverse
tax consequence to the Issuer, any Noteholder or any
Certificateholder;
(v) any action that is necessary to maintain the lien and
security interest created by this Indenture shall have been taken;
and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel each
stating that such consolidation or merger and such supplemental
indenture comply with this Article and that all conditions precedent
provided for in this Indenture relating to such transaction have been
complied with (including any filing required by the Exchange Act).
(b) Other than as specifically contemplated by the Basic Documents,
the Issuer shall not convey or transfer all or substantially all of its
properties or assets, including those included in the Trust Estate, to any
other Person, unless:
35
(i) the Person that acquires by conveyance or transfer the
properties or assets of the Issuer shall (A) be a United States
citizen or a Person organized and existing under the laws of the
United States or any State, (B) expressly assume, by an indenture
supplemental hereto, executed and delivered to the Indenture Trustee,
in form satisfactory to the Indenture Trustee, the due and punctual
payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this
Indenture and each other Basic Document on the part of the Issuer to
be performed or observed, all as provided herein, (C) expressly agree
by means of such supplemental indenture that all right, title and
interest so conveyed or transferred shall be subject and subordinate
to the rights of Noteholders, (D) unless otherwise provided in such
supplemental indenture, expressly agree to indemnify, defend and hold
harmless the Issuer against and from any loss, liability or expense
arising under or related to this Indenture and the Notes and (E)
expressly agree by means of such supplemental indenture that such
Person (or if a group of Persons, then one specified Person) shall
make all filings with the Commission (and any other appropriate
Person) required by the Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Depositor and the
Indenture Trustee) to the effect that such transaction will not have
any material adverse federal tax consequence to the Issuer, any
Noteholder or any Certificateholder;
(v) any action that is necessary to maintain the lien and
security interest created by this Indenture shall have been taken;
and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel each
stating that such conveyance or transfer and such supplemental
indenture comply with this Article and that all conditions precedent
provided for in this Indenture relating to such transaction have been
complied with (including any filing required by the Exchange Act).
Section 3.11. Successor or Transferee.
(a) Upon any consolidation or merger of the Issuer in accordance with
Section 3.10(a), the Person formed by or surviving such consolidation or
merger (if other than the Issuer) shall succeed to, and be substituted for,
and may exercise every right and power of, the Issuer under this Indenture
with the same effect as if such Person had been named as the Issuer herein.
(b) Upon any conveyance or transfer of all the properties and assets
of the Issuer in accordance with Section 3.10(b), the Issuer will be released
from every covenant and agreement of this Indenture to be observed or
performed on the part of the Issuer with respect to the Notes
36
immediately upon the delivery of written notice to the Indenture Trustee and
the Depositor stating that the Issuer is to be so released.
Section 3.12. No Other Business. The Issuer shall not engage in any
business other than financing, acquiring, owning and pledging the Receivables
in the manner contemplated by this Indenture and the other Basic Documents and
activities incidental thereto.
Section 3.13. No Borrowing. The Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for (i) the Notes and (ii) any other indebtedness
permitted by or arising under the Basic Documents.
Section 3.14. Master Servicer's Obligations. The Issuer shall cause
the Master Servicer to comply with the Sale and Servicing Agreement.
Section 3.15. Guarantees, Loans, Advances and Other Liabilities.
Except as contemplated by the Basic Documents, the Issuer shall not make any
loan or advance or credit to, or guarantee (directly or indirectly or by an
instrument having the effect of assuring another's payment or performance on
any obligation or capability of so doing or otherwise), endorse or otherwise
become contingently liable, directly or indirectly, in connection with the
obligations, stocks or dividends of, or own, purchase, repurchase or acquire
(or agree contingently to do so) any stock, obligations, assets or securities
of, or any other interest in, or make any capital contribution to, any other
Person.
Section 3.16. Capital Expenditures. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
Section 3.17. Removal of Administrator. For so long as any Notes are
Outstanding, the Issuer shall not remove the Administrator without cause
unless the Rating Agency Condition shall have been satisfied with respect to
such removal.
Section 3.18. Restricted Payments. Except as expressly permitted by
the Basic Documents, the Issuer shall not, directly or indirectly, (i) pay any
dividend or make any distribution (by reduction of capital or otherwise),
whether in cash, property, securities or a combination thereof, to the Owner
Trustee or any owner of a beneficial interest in the Issuer or otherwise with
respect to any ownership or equity interest or security in or of the Issuer or
to the Master Servicer, (ii) redeem, purchase, retire or otherwise acquire for
value any such ownership or equity interest or security or (iii) set aside or
otherwise segregate any amounts for any such purpose; provided, however, that
the Issuer may make, or cause to be made, (a) distributions as contemplated
by, and to the extent funds are available for such purpose under, the Sale and
Servicing Agreement or the Trust Agreement and (b) payments to the Indenture
Trustee pursuant to Section 1.02(b)(ii) of the Administration Agreement. The
Issuer will not, directly or indirectly, make payments to or distributions
from the Collection Account, the Note Payment Account, the Certificate Payment
Account, the Yield Supplement Account or the Reserve Fund except in accordance
with this Indenture and the other Basic Documents.
Section 3.19. Notice of Events of Default. The Issuer shall give each
Rating Agency, a Responsible Officer of the Indenture Trustee and the
Depositor prompt written notice of each Event of Default hereunder and each
default on the part of the Seller, the Master Servicer or the
37
Depositor of its obligations under the Sale and Servicing Agreement and each
default on the part of the Seller or the Depositor of its obligations under
the Receivables Purchase Agreement.
Section 3.20. Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer will execute and deliver such further
instruments and do such further acts as may be reasonably necessary or proper
to carry out more effectively the purpose of this Indenture.
Section 3.21. Compliance with Laws. The Issuer shall comply with the
requirements of all applicable laws, the non-compliance with which would,
individually or in the aggregate, materially and adversely affect the ability
of the Issuer to perform its obligations under the Notes, this Indenture or
any Basic Document.
Section 3.22. Amendments of Sale and Servicing Agreement and Trust
Agreement. The Issuer shall not agree to any amendment to Section 9.01 of the
Sale and Servicing Agreement or Section 11.01 of the Trust Agreement to
eliminate the requirements thereunder that the Indenture Trustee or the
Noteholders consent to amendments thereto as provided therein.
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ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect with respect to the Notes except as to (i)
rights of registration of transfer and exchange, (ii) substitution of
mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to
receive payments of principal thereof and interest thereon, (iv) Sections
3.03, 3.04, 3.05, 3.08, 3.10, 3.12, 3.13, 3.16 and 3.17, (v) the rights,
obligations and immunities of the Indenture Trustee hereunder (including the
rights of the Indenture Trustee under Section 6.07 and the obligations of the
Indenture Trustee under Section 4.02) and (vi) the rights of Noteholders as
beneficiaries hereof with respect to the property so deposited with the
Indenture Trustee payable to all or any of them, and the Indenture Trustee, on
demand of and at the expense of the Issuer, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to the
Notes, when
(a) either
(i) all Notes theretofore authenticated and
delivered (other than Notes (1) that have been destroyed,
lost or stolen and that have been replaced or paid as
provided in Section 2.06 and (2) for whose payment money has
theretofore been deposited in trust or segregated and held
in trust by the Issuer and thereafter repaid to the Issuer
or discharged from such trust, as provided in Section 3.03)
have been delivered to the Indenture Trustee for
cancellation; or
(ii) all Notes not theretofore delivered to the
Indenture Trustee for cancellation
(A) have become due and payable,
(B) will become due and payable at the
Class B Final Scheduled Distribution Date within
one year or
(C) are to be called for redemption within
one year under arrangements satisfactory to the
Indenture Trustee for the giving of notice of
redemption by the Indenture Trustee in the name,
and at the expense, of the Issuer,
and the Issuer, in the case of clauses (A), (B) or (C)
above, has irrevocably deposited or caused to be irrevocably
deposited with the Indenture Trustee, in trust, cash or
direct obligations of or obligations guaranteed by the
United States (which will mature prior to the date such
amounts are payable), in trust for such purpose, in an
amount sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore delivered to the
Indenture Trustee for cancellation when due to the related
Final Scheduled Distribution Date or Redemption Date (if
Notes shall have been called for redemption pursuant to
Section 10.01), as the case may be;
39
(b) the Issuer has paid or caused to be paid all other sums
payable by the Issuer hereunder and under this Indenture, the other
Basic Documents;
(c) the Issuer has delivered to the Depositor and the
Indenture Trustee an Officer's Certificate, an Opinion of Counsel and
(if required by the TIA or the Indenture Trustee) an Independent
Certificate from a firm of certified public accountants, each meeting
the applicable requirements of Section 11.01(a) and, subject to
Section 11.02, each stating that all conditions precedent provided
for in this Indenture relating to the satisfaction and discharge of
this Indenture have been complied with; and
(d) the Issuer has delivered to the Depositor and the
Indenture Trustee an Opinion of Counsel to the effect that the
satisfaction and discharge of this Indenture pursuant to this Section
will not cause any Noteholder to be treated as having sold or
exchanged any of its Notes for purposes of Section 1001 of the Code.
Section 4.02. Satisfaction, Discharge and Defeasance of the Notes.
(a) Upon satisfaction of the conditions set forth in Section 4.02(b),
the Issuer shall be deemed to have paid and discharged the entire indebtedness
on all the Notes Outstanding, and the provisions of this Indenture, as it
relates to such Notes, shall no longer be in effect (and the Indenture
Trustee, at the expense of the Issuer, shall execute proper instruments
acknowledging the same), except as to:
(i) the rights of the Noteholders to receive, from the trust
funds described in Section 4.02(b)(i), payment of the principal of
and interest on the Notes Outstanding at maturity of such principal
or interest;
(ii) the obligations of the Issuer with respect to the Notes
under Sections 2.05, 2.06, 3.02 and 3.03;
(iii) the obligations of the Administrator to the Indenture
Trustee under Section 6.07; and
(iv) the rights, powers, trusts and immunities of the
Indenture Trustee hereunder and the duties of the Indenture Trustee
hereunder.
(b) The satisfaction, discharge and defeasance of the Notes pursuant
to Section 4.02(a) is subject to the satisfaction of all of the following
conditions:
(i) the Issuer has deposited or caused to be deposited
irrevocably (except as provided in Section 4.04) with the Indenture
Trustee as trust funds in trust, specifically pledged as security
for, and dedicated solely to, the benefit of the Noteholders, which,
through the payment of interest and principal in respect thereof in
accordance with their terms will provide, not later than one day
prior to the due date of any payment referred to below, money in an
amount sufficient, in the opinion of a nationally recognized firm of
Independent certified public accountants expressed in a written
certification thereof delivered to the Indenture Trustee, to pay and
discharge the entire indebtedness on the Notes Outstanding, for
principal thereof and interest thereon to the date of such deposit
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(in the case of Notes that have become due and payable) or to the
maturity of such principal and interest, as the case may be;
(ii) such deposit will not result in a breach or violation
of, or constitute an event of default under, any Basic Document or
other agreement or instrument to which the Issuer is bound;
(iii) no Event of Default has occurred and is continuing on
the date of such deposit or on the 91st day after such date;
(iv) the Issuer has delivered to the Depositor and the
Indenture Trustee an Opinion of Counsel to the effect that the
satisfaction, discharge and defeasance of the Notes pursuant to this
Section will not cause any Noteholder to be treated as having sold or
exchanged any of its Notes for purposes of Section 1001 of the Code;
and
(v) the Issuer has delivered to the Depositor and the
Indenture Trustee an Officer's Certificate and an Opinion of Counsel,
each stating that all conditions precedent provided for in this
Indenture relating to the defeasance contemplated by this Section
have been complied with.
Section 4.03. Application of Trust Money. All monies deposited with
the Indenture Trustee pursuant to this Article shall be held in and applied by
the Indenture Trustee, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, to the
Holders of the Notes for the payment or redemption of which such monies have
been deposited with the Indenture Trustee, of all sums due and to become due
thereon for principal and interest; but such monies need not be segregated
from other funds except to the extent required herein or in the Sale and
Servicing Agreement or required by law.
Section 4.04. Repayment of Monies Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to the
Notes, all monies then held by any Paying Agent other than the Indenture
Trustee under the provisions of this Indenture with respect to such Notes
shall, upon demand of the Issuer, be paid to the Indenture Trustee to be held
and applied according to Section 3.03 and thereupon such Paying Agent shall be
released from all further liability with respect to such monies.
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ARTICLE FIVE
EVENTS OF DEFAULT; REMEDIES
Section 5.01. Events of Default. Wherever used herein, "Event of
Default" means the occurrence of any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) default in the payment of any interest on any Note of
the Controlling Class when the same becomes due and payable, and such
default shall continue for a period of five days;
(ii) default in the payment of the principal of any Note on
its Final Scheduled Distribution Date;
(iii) default in the observance or performance of any
material covenant or agreement of the Issuer made in this Indenture
(other than a covenant or agreement, a default in the observance or
performance of which is specifically dealt with elsewhere in this
Section) and such default shall continue or not be cured for a period
of 60 days after there shall have been given, by registered or
certified mail, to the Issuer by the Depositor or the Indenture
Trustee or to the Issuer, the Depositor and the Indenture Trustee, by
the Holders of Notes evidencing not less than 25% of the Note Balance
of the Controlling Class, a written notice specifying such default
and requiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder;
(iv) any representation or warranty of the Issuer made in
this Indenture or in any certificate or other writing delivered
pursuant hereto or in connection herewith proving to have been
incorrect in any material respect as of the time when the same shall
have been made, and the circumstance or condition in respect of which
such representation or warranty was incorrect shall not have been
eliminated or otherwise cured for a period of 30 days after there
shall have been given, by registered or certified mail, to the Issuer
by the Depositor or the Indenture Trustee or to the Issuer, the
Depositor and the Indenture Trustee by the Holders of Notes
evidencing not less than 25% of the Note Balance of the Controlling
Class, a written notice specifying such incorrect representation or
warranty and requiring it to be remedied and stating that such notice
is a notice of Default hereunder;
(v) the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuer or any
substantial part of the Trust Estate in an involuntary case under any
applicable federal or State bankruptcy, insolvency or other similar
law now or hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the
Issuer or for any substantial part of the Trust Estate, or ordering
the winding-up or liquidation of the Issuer's affairs, and such
decree or order shall remain unstayed and in effect for a period of
60 consecutive days; or
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(vi) the commencement by the Issuer of a voluntary case
under any applicable federal or State bankruptcy, insolvency or other
similar law now or hereafter in effect, or the consent by the Issuer
to the entry of an order for relief in an involuntary case under any
such law, or the consent by the Issuer to the appointment or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any substantial
part of the Trust Estate, or the making by the Issuer of any general
assignment for the benefit of creditors, or the failure by the Issuer
generally to pay its debts as such debts become due, or the taking of
any action by the Issuer in furtherance of any of the foregoing.
The Issuer shall deliver to the Depositor and the Indenture Trustee,
within five days after the occurrence thereof, written notice in the form of
an Officer's Certificate of any event which with the giving of notice or the
lapse of time or both would become an Event of Default under clause (iii) or
(iv) above, its status and what action the Issuer is taking or proposes to
take with respect thereto.
Section 5.02. Acceleration of Maturity; Rescission and Annulment.
(a) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee or the Holders of Notes evidencing not less than 51% of the
Note Balance of the Controlling Class may, upon prior written notice to each
Rating Agency, declare the Notes to be immediately due and payable by written
notice to the Issuer (and to the Indenture Trustee if given by Noteholders),
the Depositor and the Master Servicer, and upon any such declaration the
unpaid principal amount of the Notes, together with accrued and unpaid
interest thereon through the date of acceleration, shall become immediately
due and payable.
(b) If the Notes have been declared immediately due and payable
following an Event of Default, before a judgment or decree for payment of the
amount due has been obtained by the Indenture Trustee as hereinafter provided
in this Article, the Holders of Notes evidencing not less than 51% of the Note
Balance of the Controlling Class, by written notice to the Issuer, the
Depositor and the Indenture Trustee, may rescind and annul such declaration of
acceleration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture
Trustee a sum sufficient to pay all payments of principal of and
interest on the Notes and all other amounts that would then be due
hereunder or upon the Notes if the Event of Default giving rise to
such acceleration had not occurred; and
(ii) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such
acceleration, have been cured or waived as provided in Section 5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
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Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.
(a) If a default is made in the payment of (i) any interest on any
Note of the Controlling Class when the same becomes due and payable, and such
default continues for a period of five days, or (ii) the principal of any Note
on the related Final Scheduled Distribution Date, the Issuer will, upon demand
of the Indenture Trustee, pay to it, for the benefit of the Noteholders, the
entire amount then due and payable on such Notes for principal and interest,
with interest upon the overdue principal at the applicable Interest Rate and,
to the extent payment at such rate of interest shall be legally enforceable,
upon overdue installments of interest at the applicable Interest Rate and, in
addition thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee and its agents
and counsel and other amounts due and owing to the Indenture Trustee pursuant
to Section 6.07.
(b) If the Issuer shall fail forthwith to pay such amounts upon such
demand, the Indenture Trustee, in its own name and as trustee of an express
trust, may institute a Proceeding for the collection of the sums so due and
unpaid, and may prosecute such Proceeding to judgment or final decree, and may
enforce the same against the Issuer or any other obligor upon the Notes and
collect in the manner provided by law out of the property of the Issuer or
other obligor upon such Notes, wherever situated, the monies adjudged or
decreed to be payable.
(c) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee may, as more particularly provided in Section 5.04, in its
discretion, proceed to protect and enforce its rights and the rights of the
Noteholders by such appropriate Proceedings as the Indenture Trustee shall
deem most effective to protect and enforce such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper
remedy or legal or equitable right vested in the Indenture Trustee by this
Indenture or by law.
(d) If there shall be pending, relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest
in the Trust Estate, Proceedings under Title 11 of the United States Code or
any other applicable federal or State bankruptcy, insolvency or other similar
law, or if a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or
Person, or if there shall be pending any other comparable judicial Proceedings
relative to the Issuer or other obligor upon the Notes, or to the creditors or
property of the Issuer or such other obligor, the Indenture Trustee,
irrespective of whether the principal of any Notes shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective
of whether the Indenture Trustee shall have made any demand pursuant to the
provisions of this Section, shall be entitled and empowered, by intervention
in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount
of principal and interest owing and unpaid in respect of the Notes
and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Indenture Trustee
(including any claim for reasonable compensation to the Indenture
Trustee and each predecessor Indenture Trustee, and
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their respective agents and attorneys, and for all expenses and other
amounts due and owing to the Indenture Trustee pursuant to Section
6.07 and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to
vote on behalf of the Noteholders in any election of a trustee, a
standby trustee or Person performing similar functions in any such
Proceedings;
(iii) to collect and receive any monies or other property
payable or deliverable on any such claims and to pay all amounts
received with respect to the claims of the Noteholders and of the
Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the
claims of the Indenture Trustee or the Noteholders allowed in any
Proceedings relative to the Issuer, its creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of the Noteholders to make
payments to the Indenture Trustee and, in the event that the Indenture Trustee
shall consent to the making of payments directly to the Noteholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents and attorneys, and all other expenses and amounts due
and owing to the Indenture Trustee pursuant to Section 6.07.
(e) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Noteholder any plan of reorganization, arrangement, adjustment
or composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the
election of a trustee in bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture Trustee
without the possession of any of the Notes or the production thereof in any
trial or other Proceedings relative thereto, and any such action or
Proceedings instituted by the Indenture Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment, subject to
the payment of the expenses, disbursements and compensation of the Indenture
Trustee, each predecessor Indenture Trustee and their respective agents and
attorneys, shall be for the ratable benefit of the Noteholders.
(g) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Noteholders, and it shall not be necessary to make
any Noteholder a party to any such Proceedings.
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Section 5.04. Remedies.
(a) If the Notes have been declared to be immediately due and payable
following an Event of Default, the Indenture Trustee may, or at the written
direction of the Holders of Notes evidencing not less than 51% of the Note
Balance of the Controlling Class shall, take one or more of the following
actions as so directed (subject to Sections 5.02 and 5.05):
(i) institute Proceedings in its own name and as trustee of
an express trust for the collection of all amounts then payable on
the Notes or under this Indenture with respect thereto, whether by
declaration or otherwise, enforce any judgment obtained and collect
from the Issuer and any other obligor upon the Notes monies adjudged
due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect to the
Trust Estate;
(iii) exercise any remedies of a secured party under the UCC
and take any other appropriate action to protect and enforce the
rights and remedies of the Indenture Trustee and the Noteholders; and
(iv) sell the Trust Estate or any portion thereof or rights
or interest therein, at one or more public or private sales called
and conducted in any manner permitted by law;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Trust Estate at the direction of the Noteholders following an
Event of Default, other than an Event of Default described in Section 5.01(i)
or (ii), unless (A) the Holders of Notes evidencing 100% of the Note Balance
consent thereto, (B) the proceeds of such sale or liquidation will be
sufficient to pay in full the Note Balance and all accrued but unpaid interest
on the Outstanding Notes or (C) the Indenture Trustee determines that the
Trust Estate will not continue to provide sufficient funds for the payment of
principal of and interest on the Notes as they would have become due if the
Notes had not been declared immediately due and payable, and the Indenture
Trustee obtains the consent of the Holders of Notes evidencing not less than
66 2/3% of the Note Balance of the Controlling Class. In determining such
sufficiency or insufficiency with respect to clauses (B) and (C), the
Indenture Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the Trust
Estate for such purpose.
(b) If the Indenture Trustee collects any money or property pursuant
to this Section as a result of selling or liquidating the Trust Estate, it
shall pay out such money or property (together with all Available Collections
and all amounts on deposit in the Accounts) on the related Distribution Date
or other date fixed pursuant to Section 5.04(c) in the order of priority set
forth in Section 2.08(f), provided that amounts on deposit in the Pre-Funding
Account shall be distributed in the order of priority set forth in 2.08(b).
(c) The Indenture Trustee may fix a record date and distribution date
for any payment to Noteholders pursuant to this Section. At least five days
before such record date, the Indenture Trustee on behalf of the Issuer shall
mail to each Noteholder and the Indenture Trustee a notice that states the
record date, the distribution date and the amount to be paid.
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Section 5.05. Optional Preservation of the Receivables. If the Notes
have been declared to be due and payable under Section 5.02 following an Event
of Default and such declaration and its consequences have not been rescinded
and annulled, the Indenture Trustee may, but need not, elect to maintain
possession of the Trust Estate and apply proceeds as if there had been no
declaration of acceleration; provided however, that the Available Funds shall
be applied in accordance with such declaration of acceleration in the manner
specified in Section 2.08(f). It is the desire of the parties hereto and the
Noteholders that there be at all times sufficient funds for the payment of
principal of and interest on the Notes, and the Indenture Trustee shall take
such desire into account when determining whether or not to maintain
possession of the Trust Estate. In determining whether to maintain possession
of the Trust Estate, the Indenture Trustee may, but need not, obtain and rely
upon an opinion of an Independent investment banking or accounting firm of
national reputation as to the feasibility of such proposed action and as to
the sufficiency of the Trust Estate for such purpose.
Section 5.06. Limitation of Suits. No Holder of any Note shall have
any right to institute any Proceeding with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder,
unless:
(a) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(b) the Holders of Notes evidencing not less than 25% of the
Note Balance of the Controlling Class have made written request to
the Indenture Trustee to institute such Proceeding in respect of such
Event of Default in its own name as Indenture Trustee hereunder; (c)
such Holder or Holders have offered to the Indenture Trustee
reasonable indemnity against the costs, expenses and liabilities to
be incurred in complying with such request;
(d) the Indenture Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed to institute
such Proceedings; and
(e) no direction inconsistent with such written request has
been given to the Indenture Trustee during such 60-day period by the
Holders of Notes evidencing not less than 51% of the Note Balance of
the Controlling Class.
It is understood and intended that no one or more Noteholders shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Noteholders or to obtain or to seek to obtain priority or preference
over any other Noteholders or to enforce any right under this Indenture,
except in the manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Notes, each evidencing less than 51% of the Note Balance of the Controlling
Class, the Indenture Trustee in its sole discretion may determine what action,
if any, shall be taken, notwithstanding any other provisions of this
Indenture.
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Section 5.07. Unconditional Rights of Noteholders to Receive
Principal and Interest. Notwithstanding any other provisions of this
Indenture, the Holder of any Note shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest, if any, on
such Note on the respective due dates thereof expressed in such Note or in
this Indenture (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such right shall
not be impaired without the consent of such Holder.
Section 5.08. Restoration of Rights and Remedies. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right
or remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to the Indenture
Trustee or such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had
been instituted.
Section 5.09. Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Indenture Trustee or the Noteholders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 5.10. Delay or Omission Not a Waiver. No delay or omission of
the Indenture Trustee or any Noteholder to exercise any right or remedy
accruing upon any Default or Event of Default shall impair any such right or
remedy or constitute a waiver of any such Default or Event of Default or any
acquiescence therein. Every right and remedy given by this Article or by law
to the Indenture Trustee or the Noteholders may be exercised from time to
time, and as often as may be deemed expedient, by the Indenture Trustee or the
Noteholders, as the case may be.
Section 5.11. Control by Noteholders of the Controlling Class. The
Holders of Notes evidencing not less than 51% of the Note Balance of the
Controlling Class shall have the right to direct the time, method and place of
conducting any Proceeding for any remedy available to the Indenture Trustee
with respect to the Notes or exercising any trust or power conferred on the
Indenture Trustee; provided, however, that:
(i) such direction shall not be in conflict with any rule of
law or with this Indenture;
(ii) subject to the terms of Section 5.04, any direction to
the Indenture Trustee to sell or liquidate the Trust Estate shall be
by the Holders of Notes evidencing not less than 100% of the Note
Balance;
(iii) if the conditions set forth in Section 5.05 have been
satisfied and the Indenture Trustee elects to retain the Trust Estate
pursuant to such Section, then any written direction to the Indenture
Trustee by the Holders of Notes evidencing less than
48
100% of the Note Balance to sell or liquidate the Trust Estate shall
be of no force and effect; and
(iv) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee that is not inconsistent with such
direction.
Notwithstanding the rights of Noteholders set forth in this Section, subject
to Section 6.01, the Indenture Trustee need not take any action that it
reasonably believes might involve it in costs, expenses and liabilities for
which it will not be adequately indemnified or might materially adversely
affect the rights of any Noteholders not consenting to such action.
Section 5.12. Waiver of Past Defaults. Prior to the declaration of
the acceleration of the maturity of the Notes as provided in Section 5.02, the
Holders of Notes evidencing not less than 51% of the Note Balance of the
Controlling Class may, on behalf of all Noteholders, waive any past Default or
Event of Default and its consequences except a Default or Event of Default (i)
in payment of principal of or interest on any of the Notes or (ii) in respect
of a covenant or provision hereof that cannot be amended, supplemented or
modified without the consent of all the Noteholders. Upon any such waiver, the
Issuer, the Indenture Trustee and the Noteholders shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other Default or Event of Default or impair any
right consequent thereto. Upon any such waiver, such Default or Event of
Default shall cease to exist and be deemed to have been cured and not to have
occurred, and any Event of Default arising therefrom shall be deemed to have
been cured and not to have occurred, for every purpose of this Indenture, but
no such waiver shall extend to any subsequent or other Default or Event of
Default or impair any right consequent thereto.
Section 5.13. Undertaking for Costs. All parties to this Indenture
agree, and each Holder of any Note by such Holder's acceptance thereof shall
be deemed to have agreed, that any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Indenture, or in
any suit against the Indenture Trustee for any action taken, suffered or
omitted by it as Indenture Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may
in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant;
provided, however, that the provisions of this Section shall not apply to any
suit instituted by (i) the Indenture Trustee, (ii) any Noteholder, or group of
Noteholders, in each case holding Notes evidencing in the aggregate more than
10% of the Note Balance (or, in the case of any suit which is instituted by
the Controlling Class, more than 10% of the Note Balance of the Controlling
Class) or (iii) any Noteholder for the enforcement of the payment of principal
of or interest on any Note on or after the respective due dates expressed in
such Note and in this Indenture (or, in the case of redemption, on or after
the Redemption Date).
Section 5.14. Waiver of Stay or Extension Laws. The Issuer covenants
(to the extent that it may lawfully do so) that it shall not at any time
insist upon, or plead or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly
49
waives all benefit or advantage of any such law, and covenants that it shall
not hinder, delay or impede the execution of any power herein granted to the
Indenture Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
Section 5.15. Action on Notes. The Indenture Trustee's right to seek
and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under or
with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be
impaired by the recovery of any judgment by the Indenture Trustee against the
Issuer or by the levy of any execution under such judgment upon any portion of
the Trust Estate or upon any of the assets of the Issuer. Any money or
property collected by the Indenture Trustee shall be applied in accordance
with Section 5.04(b).
Section 5.16. Performance and Enforcement of Certain Obligations.
(a) Promptly following a request from the Indenture Trustee to do so
and at the Administrator's expense, the Issuer shall take all such lawful
action as the Indenture Trustee may request to compel or secure the
performance and observance by the Depositor, the Seller and the Master
Servicer of their respective obligations to the Issuer under or in connection
with the Sale and Servicing Agreement or by the Seller of its obligations
under or in connection with the Receivables Purchase Agreement, and to
exercise any and all rights, remedies, powers and privileges lawfully
available to the Issuer under or in connection with the Sale and Servicing
Agreement to the extent and in the manner directed by the Indenture Trustee,
including the transmission of notices of default on the part of the Depositor,
the Seller or the Master Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Depositor, the Seller and the Master Servicer of their respective obligations
under the Sale and Servicing Agreement.
(b) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee may, and at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter)) of Holders
of Notes evidencing not less than 66 2/3% of the Note Balance of the
Controlling Class shall, exercise all rights, remedies, powers, privileges and
claims of the Issuer against the Depositor, the Seller or the Master Servicer
under or in connection with the Sale and Servicing Agreement or against the
Seller under or in connection with the Receivables Purchase Agreement,
including the right or power to take any action to compel or secure
performance or observance by the Depositor, the Seller or the Master Servicer,
as the case may be, of its obligations to the Issuer thereunder and to give
any consent, request, notice, direction, approval, extension or waiver under
the Sale and Servicing Agreement or the Receivables Purchase Agreement, as the
case may be, and any right of the Issuer to take such action shall be
suspended.
(c) Promptly following a request from the Indenture Trustee to do so
and at the Administrator's expense, the Issuer agrees to take all such lawful
action as the Indenture Trustee may request to compel or secure the
performance and observance by the Seller of its obligations to the Depositor
under or in connection with the Receivables Purchase Agreement in accordance
with the terms thereof, and to exercise any and all rights, remedies, powers
and privileges lawfully available to the Depositor or the Issuer under or in
connection with the Receivables
50
Purchase Agreement to the extent and in the manner directed by the Indenture
Trustee, including the transmission of notices of default on the part of the
Depositor or the Seller thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Seller of its obligations under the Receivables Purchase Agreement.
(d) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee may, and at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter)) of the
Holders of Notes evidencing not less than 66 2/3% of the Note Balance of the
Controlling Class shall, exercise all rights, remedies, powers, privileges and
claims of the Depositor against the Seller under or in connection with the
Receivables Purchase Agreement, including the right or power to take any
action to compel or secure performance or observance by the Seller of its
obligations to the Depositor thereunder and to give any consent, request,
notice, direction, approval, extension or waiver under the Receivables
Purchase Agreement, and any right of the Depositor to take such action shall
be suspended.
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ARTICLE SIX
THE INDENTURE TRUSTEE
Section 6.01. Duties of Indenture Trustee.
(a) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such Person's own affairs; provided, however, that if the Indenture Trustee
shall assume the duties of the Master Servicer, pursuant to Section 3.07(e),
the Indenture Trustee in performing such duties shall use the degree of care
and skill customarily exercised by a prudent institutional servicer, with
respect to retail motor vehicle installment sale contracts that it administers
or services, as the case may be, for itself or others.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such duties
and only such duties as are specifically set forth in this Indenture
and no implied covenants or obligations shall be read into this
Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the Indenture
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates
or opinions furnished to the Indenture Trustee and, if required by
the terms of this Indenture, conforming to the requirements of this
Indenture; provided, however, that the Indenture Trustee shall
examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of Section
6.01(b);
(ii) the Indenture Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer of the
Indenture Trustee unless it is proved that the Indenture Trustee was
negligent in ascertaining the pertinent facts; and
(iii) the Indenture Trustee shall not be liable with respect
to any action it takes or omits to take in good faith in accordance
with a direction received by it pursuant to Section 5.11.
(d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Indenture Trustee shall not be liable for interest on any
money received by it except as the Indenture Trustee may agree in writing with
the Issuer.
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(f) Money held in trust by the Indenture Trustee need not be
segregated from other funds except to the extent required by law or the terms
of this Indenture or the Sale and Servicing Agreement.
(g) No provision of this Indenture shall require the Indenture
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder or in the exercise of any of
its rights or powers hereunder, if the Indenture Trustee shall have reasonable
grounds to believe that repayment of such funds or indemnity satisfactory to
it against such risk or liability is not assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of
the TIA.
(i) The Indenture Trustee shall not be charged with knowledge of any
Event of Default unless either (i) a Responsible Officer of the Indenture
Trustee shall have actual knowledge of such Event of Default or (ii) written
notice of such Event of Default shall have been given to the Indenture Trustee
in accordance with the provisions of this Indenture.
Section 6.02. Rights of Indenture Trustee.
(a) The Indenture Trustee may rely on any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Indenture Trustee need not investigate any fact, calculation or matter stated
in any such document. Notwithstanding the foregoing, the Indenture Trustee,
upon receipt of all resolutions, certificates, statements, opinions, reports,
documents, orders or other instruments furnished to the Indenture Trustee that
shall be specifically required to be furnished pursuant to any provision of
this Indenture, shall examine them to determine whether they comply as to form
to the requirements of this Indenture.
(b) Before the Indenture Trustee acts or refrains from acting, it may
request and be entitled to receive an Officer's Certificate or an Opinion of
Counsel. The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on an Officer's Certificate or Opinion
of Counsel unless it is proved that the Indenture Trustee was negligent in
such reliance.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Indenture Trustee shall
not be responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.
(d) The Indenture Trustee shall not be liable for any action it takes
or omits to take in good faith which it believes to be authorized or within
its rights or powers; provided, however, that such action or omission by the
Indenture Trustee does not constitute willful misconduct, negligence or bad
faith.
(e) The Indenture Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture
and the Notes shall be full and
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complete authorization and protection from liability in respect to any action
taken, omitted or suffered by it hereunder in good faith and in accordance
with the advice or opinion of such counsel.
(f) The Indenture Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the request or
direction of any of the Noteholders pursuant to this Indenture, unless such
Noteholders shall have offered to the Indenture Trustee security or indemnity
satisfactory to it against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
Section 6.03. Individual Rights of Indenture Trustee. The Indenture
Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Issuer or its Affiliates with
the same rights it would have if it were not Indenture Trustee. Any Paying
Agent, Note Registrar, co-registrar or co-paying agent may do the same with
like rights.
Section 6.04. Indenture Trustee's Disclaimer. The Indenture Trustee
shall not be (i) responsible for and makes no representation as to the
validity or adequacy of this Indenture or the Notes, (ii) accountable for the
Issuer's use of the proceeds from the Notes and (iii) responsible for any
statement of the Issuer in this Indenture or in any document issued in
connection with the sale of the Notes or in the Notes other than the Indenture
Trustee's certificate of authentication.
Section 6.05. Notice of Defaults. If a Default occurs and is
continuing and if it is known to a Responsible Officer of the Indenture
Trustee, the Indenture Trustee shall mail to each Noteholder notice of such
Default within 30 days after it occurs. Except in the case of a Default in
payment of principal of or interest on any Note (including payments pursuant
to the mandatory redemption provisions of such Note), the Indenture Trustee
may withhold the notice if and so long as a committee of its Responsible
Officers in good faith determines that withholding the notice is in the
interests of Noteholders.
Section 6.06. Reports by Indenture Trustee to Noteholders. The
Indenture Trustee shall deliver, within a reasonable period of time after the
end of each calendar year, to each Person who at any time during such calendar
year was a Noteholder, such information furnished to the Indenture Trustee as
may be required to enable such Person to prepare its federal and State income
tax returns.
Section 6.07. Compensation and Indemnity.
(a) The Administrator, on behalf of the Issuer, shall pay to the
Indenture Trustee from time to time reasonable compensation for its services.
The Indenture Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Administrator, on behalf of
the Issuer, shall reimburse the Indenture Trustee for all expenses, advances
and disbursements reasonably incurred or made by it, including costs of
collection, in addition to the compensation for its services; provided,
however, that the Administrator need not reimburse the Indenture Trustee for
any expense incurred through the Indenture Trustee's willful misconduct,
negligence, or bad faith. Such expenses shall include the reasonable
compensation
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and expenses, disbursements and advances of the Indenture Trustee's agents,
counsel, accountants and experts. The Administrator, on behalf of the Issuer,
shall indemnify the Indenture Trustee for, and hold it and its officers,
directors, employees, representatives and agents, harmless against, any and
all loss, liability or expense (including reasonable attorneys' fees and
expenses) incurred by it in connection with the administration of this trust
and the performance of its duties hereunder; provided, however, that the
Administrator need not indemnify the Indenture Trustee for, or hold it
harmless against, any such loss, liability or expense incurred through the
Indenture Trustee's willful misconduct, negligence, or bad faith. The
Indenture Trustee shall notify the Issuer and the Administrator promptly of
any claim for which it may seek indemnity. Any failure by the Indenture
Trustee to so notify the Issuer and the Administrator shall not, however,
relieve the Administrator of its obligations hereunder. The Administrator, on
behalf of the Issuer, shall defend any such claim. The Indenture Trustee may
have separate counsel in connection with the defense of any such claim, and
the Administrator, on behalf of the Issuer, shall pay the fees and expenses of
such counsel. Neither the Issuer nor the Administrator need reimburse any
expense or indemnify against any loss, liability or expense incurred by the
Indenture Trustee through the Indenture Trustee's own willful misconduct,
negligence or bad faith.
(b) The payment obligations to the Indenture Trustee pursuant to this
Section shall survive the resignation or removal of the Indenture Trustee and
the discharge of this Indenture. When the Indenture Trustee incurs fees or
expenses after the occurrence of a Default specified in Section 5.01(v) or
(vi) with respect to the Issuer, such fees and expenses are intended to
constitute expenses of administration under Title 11 of the United States Code
or any other applicable federal or State bankruptcy, insolvency or similar
law.
Section 6.08. Replacement of Indenture Trustee.
(a) No resignation or removal of the Indenture Trustee and no
appointment of a successor Indenture Trustee shall become effective until the
acceptance of appointment by the successor Indenture Trustee pursuant to this
Section. The Indenture Trustee may resign at any time by so notifying the
Issuer, the Depositor and the Noteholders, and will provide all information
reasonably requested by the Depositor in order to comply with its reporting
obligation under Item 6.02 of Form 8-K under the Exchange Act, with respect to
the resignation of the Indenture Trustee. The Holders of Notes evidencing not
less than 51% of the Note Balance of the Notes may remove the Indenture
Trustee without cause by notifying the Indenture Trustee (with a copy to the
Issuer, the Depositor and the Rating Agencies) of such removal and, following
such removal, may appoint a successor Indenture Trustee. The Issuer shall
remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) the Indenture Trustee is adjudged to be bankrupt or
insolvent;
(iii) a receiver or other public officer takes charge of the
Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes incapable of
acting.
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The Depositor may remove the Indenture Trustee if the Indenture Trustee fails
to comply with Section 3.07(e), Section 6.08 or Section 6.09 with respect to
notice to or providing information to the Depositor, or with Article Nine of
the Sale and Servicing Agreement, in each case if such failure continues for
the lesser or 10 days or such period in which the applicable Exchange Act
Report can be filed timely (without taking into account any extensions). If
the Indenture Trustee resigns or is removed or if a vacancy exists in the
office of the Indenture Trustee for any reason (the Indenture Trustee in such
event being referred to herein as the retiring Indenture Trustee), the
Administrator shall promptly appoint a successor Indenture Trustee and notify
the Depositor such appointment.
(b) Any successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee, the Issuer
and the Depositor and shall also provide all information reasonably requested
by the Depositor in order to comply with its reporting obligation under the
Exchange Act with respect to the replacement Indenture Trustee. Upon delivery
of such written acceptance, the resignation or removal of the retiring
Indenture Trustee shall become effective, and the successor Indenture Trustee
shall have all the rights, powers and duties of the Indenture Trustee under
this Indenture. The successor Indenture Trustee shall mail a notice of its
succession to the Noteholders. The retiring Indenture Trustee shall promptly
transfer all property held by it as Indenture Trustee to the successor
Indenture Trustee.
(c) If a successor Indenture Trustee does not take office within 60
days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Holders of Notes evidencing not less than
51% of the Note Balance of the Controlling Class may petition any court of
competent jurisdiction for the appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any Noteholder may
petition any court of competent jurisdiction for the removal of the Indenture
Trustee and the appointment of a successor Indenture Trustee.
(d) Notwithstanding the replacement of the Indenture Trustee pursuant
to this Section, the Issuer's and the Administrator's obligations under
Section 6.07 shall continue for the benefit of the retiring Indenture Trustee.
Section 6.09. Successor Indenture Trustee by Merger.
(a) If the Indenture Trustee consolidates with, merges or converts
into, or transfers all or substantially all its corporate trust business or
assets to, another corporation or banking association, the resulting,
surviving or transferee corporation or banking association, without any
further act, shall be the successor Indenture Trustee; provided, however, that
such corporation or banking association must be otherwise qualified and
eligible under Section 6.11. The Indenture Trustee shall provide the Rating
Agencies and the Depositor with prior written notice of any such transaction
and shall provide the Depositor with written notice of such event no later
than one Business Day after the effective date of such merger, together with
the information reasonably requested by the Depositor in order to comply with
its reporting obligation under the Exchange Act with respect to a successor
Indenture Trustee.
(b) If at the time such successor or successors by consolidation,
merger or conversion to the Indenture Trustee shall succeed to the trusts
created by this Indenture any of the Notes
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shall have been authenticated but not delivered, any such successor to the
Indenture Trustee may adopt the certificate of authentication of any
predecessor trustee and deliver such Notes so authenticated; and in case at
that time any of the Notes shall not have been authenticated, any such
successor to the Indenture Trustee may authenticate such Notes either in the
name of any predecessor trustee or in the name of the successor to the
Indenture Trustee. In all such cases such certificates shall have the full
force which the Notes or this Indenture provide that the certificate of the
Indenture Trustee shall have.
Section 6.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provision of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Trust Estate may at the time be located, the Indenture
Trustee and the Administrator, acting jointly, shall have the power and may
execute and deliver an instrument to appoint one or more Persons to act as a
co-trustee or co-trustees, jointly with the Indenture Trustee, or separate
trustee or separate trustees, of all or any part of the Trust Estate, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Noteholders, such title to the Trust Estate or any part thereof, and, subject
to the other provisions of this Section, such powers, duties, obligations,
rights and trusts as the Indenture Trustee may consider necessary or
desirable. No co-trustee or separate trustee under this Indenture shall be
required to meet the terms of eligibility as a successor trustee under Section
6.11 and no notice of the appointment of any co-trustee or separate trustee
shall be required under Section 6.08.
(b) Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Indenture Trustee shall be conferred or imposed upon
and exercised or performed by the Indenture Trustee and such separate
trustee or co-trustee jointly (it being understood that such separate
trustee or co-trustee shall not be authorized to act separately
without the Indenture Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular
act or acts are to be performed the Indenture Trustee shall be
incompetent or unqualified to perform such act or acts, in which
event such rights, powers, duties and obligations (including the
holding of title to the Trust Estate or any portion thereof in any
such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the
Indenture Trustee;
(ii) no trustee under this Indenture shall be personally
liable by reason of any act or omission of any other trustee under
this Indenture; and
(iii) the Indenture Trustee and the Administrator may at any
time accept the resignation of or remove any separate trustee or
co-trustee.
(c) Any notice, request or other writing given to the Indenture
Trustee shall be deemed to have been given to each of the then separate
trustees and co-trustees, as effectively as if given to each of them. Every
instrument appointing any separate trustee or co-trustee shall refer to this
Indenture and the conditions of this Article. Each separate trustee and
co-trustee,
57
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Indenture Trustee or separately, as may be provided therein, subject to
all the provisions of this Indenture, specifically including every provision
of this Indenture relating to the conduct of, affecting the liability of, or
affording protection to, the Indenture Trustee. Each such instrument shall be
filed with the Indenture Trustee and a copy thereof given to the
Administrator.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee, its agent or attorney-in-fact with full power and
authority, to the extent permitted by law, to do any lawful act under or in
respect of this Indenture on its behalf and in its name. If any separate
trustee or co-trustee shall die, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall
vest in and be exercised by the Indenture Trustee, to the extent permitted by
law, without the appointment of a new or successor trustee.
Section 6.11. Eligibility; Disqualification. The Indenture Trustee
shall at all times satisfy the requirements of TIA Section 310(a). The
Indenture Trustee or its parent shall have a combined capital and surplus of
at least $50,000,000 as set forth in its most recent published annual report
of condition and shall have a long term debt rating of investment grade by
each of the Rating Agencies or shall otherwise be acceptable to each Rating
Agency. The Indenture Trustee shall comply with TIA Section 310(b).
Within 90 days after ascertaining the occurrence of an Event of
Default which shall not have been cured or waived, unless authorized by the
Commission, the Indenture Trustee shall resign with respect to the Class A
Notes or the Class B Notes in accordance with Section 6.08, and the Issuer
shall appoint a successor Indenture Trustee for one or more of such Classes,
as applicable, so that there will be separate Indenture Trustees for the Class
A Notes and the Class B Notes. In the event the Indenture Trustee fails to
comply with the terms of the preceding sentence, the Indenture Trustee shall
comply with clauses (ii) and (iii) of TIA Section 310(b).
In the case of the appointment pursuant to this Section of a
successor Indenture Trustee with respect to any Class of Notes, the Issuer,
the retiring Indenture Trustee and the successor Indenture Trustee with
respect to such Class of Notes shall execute and deliver an indenture
supplemental hereto wherein each successor Indenture Trustee shall accept such
appointment and which (i) shall contain such provisions as shall be necessary
or desirable to transfer and confirm to, and to vest in, the successor
Indenture Trustee all the rights, powers, trusts and duties of the retiring
Indenture Trustee with respect to the Notes of the Class to which the
appointment of such successor Indenture Trustee relates, (ii) if the retiring
Indenture Trustee is not retiring with respect to all Classes of Notes, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all rights, powers, trusts and duties of the retiring Indenture Trustee
with respect to the Notes of each Class as to which the retiring Indenture
Trustee is not retiring shall continue to be vested in the Indenture Trustee
and (iii) shall add to or change any of the provisions of this Indenture as
shall be necessary to provide for or facilitate the administration of the
trusts hereunder by more than one Indenture Trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute such
Indenture Trustees co-trustees of the same trust and that each such Indenture
Trustee shall be a trustee of a trust or trusts hereunder separate and apart
from any trust or trusts hereunder administered by any other such Indenture
58
Trustee; and upon the removal of the retiring Indenture Trustee shall become
effective to the extent provided herein.
Section 6.12. Preferential Collection of Claims Against Issuer. The
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). An Indenture Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated.
Section 6.13. Representations and Warranties of Indenture Trustee.
The Indenture Trustee hereby makes the following representations and
warranties on which the Issuer and the Noteholders shall rely:
(a) it is a national banking association duly organized,
validly existing and in good standing under the laws of the United
States;
(b) it has full power, authority and legal right to execute,
deliver, and perform its obligations under this Indenture and has
taken all necessary action to authorize the execution, delivery and
performance by it of this Indenture; and
(c) this Indenture is an enforceable obligation of the
Indenture Trustee.
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ARTICLE SEVEN
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. Issuer to Furnish Indenture Trustee Names and Addresses
of Noteholders. The Issuer shall furnish or cause to be furnished to the
Indenture Trustee (i) not more than five days after each Record Date, a list,
in such form as the Indenture Trustee may reasonably require, of the names and
addresses of the Noteholders as of such Record Date and (ii) at such other
times as the Indenture Trustee may request in writing, within 30 days after
receipt by the Issuer of any such request, a list of similar form and content
as of a date not more than ten days prior to the time such list is furnished;
provided, however, that so long as the Indenture Trustee is the Note Registrar
or the Notes are issued as Book-Entry Notes, no such list shall be required to
be furnished.
Section 7.02. Preservation of Information; Communications, Reports
and Certain Documents to Noteholders.
(a) The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Noteholders contained
in the most recent list furnished to the Indenture Trustee as provided in
Section 7.01 and the names and addresses of Noteholders received by the
Indenture Trustee from Wachovia Bank in its capacity as Note Registrar. The
Indenture Trustee may destroy any list furnished to it as provided in such
Section 7.01 upon receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA Section 312(b) with
other Noteholders with respect to their rights under this Indenture or under
the Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall
have the protection of TIA Section 312(c).
(d) The Indenture Trustee will provide to Securityholders the
reports, certificates, opinions and documents specified in Section 3.15 of the
Sale and Servicing Agreement, upon written request to the Indenture Trustee.
Section 7.03. Reports by Issuer.
(a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after
the Issuer is required to file the same with the Commission, copies
of the annual reports and the information, documents and other
reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe)
that the Issuer may be required to file with the Commission pursuant
to Section 13 or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee, the Commission, in
accordance with rules and regulations prescribed from time to time by
the Commission, such additional information, documents and reports
with respect to compliance by the Issuer with the
60
conditions and covenants of this Indenture as may be required from
time to time by such rules and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture
Trustee shall mail to all Noteholders described in TIA Section
313(c)) such summaries of any information, documents and reports
required to be filed by the Issuer pursuant to clauses (i) and (ii)
of this Section 7.03(a) and by the rules and regulations prescribed
from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year.
Section 7.04. Reports by Indenture Trustee.
(a) If required by TIA Section 313(a), within 60 days after each
December 15 beginning with December 15, 20__, the Indenture Trustee shall mail
to each Noteholder as required by TIA Section 313(c) a brief report dated as
of such date that complies with TIA Section 313(a). The Indenture Trustee
shall also comply with TIA Section 313(b).
(b) The Indenture Trustee shall file with the Commission and each
stock exchange, if any, on which the Notes are listed a copy of each report
mailed to Noteholders pursuant to this Indenture. The Issuer shall notify the
Indenture Trustee if and when the Notes are listed on any stock exchange.
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ARTICLE EIGHT
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable
to or receivable by the Indenture Trustee pursuant to this Indenture and the
Sale and Servicing Agreement. The Indenture Trustee shall apply all such money
received by it as provided in this Indenture and the Sale and Servicing
Agreement. Except as otherwise expressly provided in this Indenture, if any
default occurs in the making of any payment or performance under any agreement
or instrument that is part of the Trust Estate, the Indenture Trustee may take
such action as may be appropriate to enforce such payment or performance,
including the institution and prosecution of appropriate Proceedings. Any such
action shall be without prejudice to any right to claim a Default or Event of
Default under this Indenture and any right to proceed thereafter as provided
in Article Five.
Section 8.02. Accounts.
(a) On or before the Closing Date, the Issuer shall cause the Master
Servicer to establish and maintain, at Wachovia Bank in the name of the
Indenture Trustee, for the benefit of the Securityholders, the Master
Servicer, the Trustees and the Paying Agent, the Collection Account as
provided in Section 4.01(a) of the Sale and Servicing Agreement. On or before
each Distribution Date, the Master Servicer shall deposit in the Collection
Account all amounts required to be deposited therein with respect to the
preceding Collection Period as provided in Sections 4.02 and 4.05 of the Sale
and Servicing Agreement. On each Distribution Date, the Indenture Trustee
shall, directly or through the Paying Agent, apply or cause to be applied the
amount on deposit in the Collection Account on such Distribution Date in
accordance with Section 2.08(a).
(b) On or before the Closing Date, the Issuer shall cause the Master
Servicer to establish and maintain, at Wachovia Bank in the name of the
Indenture Trustee, for the benefit of the Securityholders, the Reserve Fund as
provided in Section 4.07 of the Sale and Servicing Agreement. On each
Distribution Date, upon receipt of instructions from the Master Servicer
pursuant to Section 4.06(b) of the Sale and Servicing Agreement, the Indenture
Trustee, directly or through the Paying Agent, shall withdraw from the Reserve
Fund (up to the amount on deposit in the Reserve Fund) and deposit in the
Collection Account, the Reserve Fund Draw Amount, if any, for such
Distribution Date.
(c) On or before the Closing Date, the Issuer shall cause the Master
Servicer to establish and maintain, at Wachovia Bank in the name of the
Indenture Trustee, for the benefit of the Noteholders, the Master Servicer,
the Trustees and the Paying Agent, the Note Payment Account as provided in
Section 4.01(a) of the Sale and Servicing Agreement. On each Distribution
Date, the Indenture Trustee shall, directly or through the Paying Agent, apply
or cause to be applied the amount on deposit in the Note Payment Account on
such Distribution Date in accordance with Section 2.08.
62
(d) On or before the Closing Date, the Issuer shall cause the Master
Servicer to establish and maintain, at Wachovia Bank in the name of the
Indenture Trustee, for the benefit of the Securityholders, the Yield
Supplement Account as provided in Section 4.01(a) of the Sale and Servicing
Agreement. On each Distribution Date, the Indenture Trustee shall, directly or
through the Paying Agent, apply or cause to be applied the Yield Supplement
Account Draw Amount on such Distribution Date in accordance with Section 4.06
of the Sale and Servicing Agreement.
(e) On or before the Closing Date, the Issuer shall cause the Master
Servicer to establish and maintain, at Wachovia Bank in the name of the
Indenture Trustee, for the benefit of the Securityholders, the Pre-Funding
Account as provided in Section 4.01(a) of the Sale and Servicing Agreement.
During the Pre-Funding Period, at the direction of the Master Servicer, the
Indenture Trustee shall, directly or through the Paying Agent, apply or cause
to be applied amounts on deposit in the Pre-Funding Account to purchase
Subsequent Receivables in accordance with Section 4.08 of the Sale and
Servicing Agreement and on the Distribution Date following the Collection
Period in which the Pre-Funding Period ends, distribute any remaining funds on
deposit in the Pre-Funding Account in accordance with the final paragraph of
Section 2.08(b).
(f) On or before the Closing Date, the Issuer shall cause the Master
Servicer to establish and maintain, at Wachovia Bank in the name of the
Indenture Trustee, for the benefit of the Securityholders, the Negative Carry
Account as provided in Section 4.01(a) of the Sale and Servicing Agreement. On
each Distribution Date, pursuant to Section 4.06 of the Sale and Servicing
Agreement, the Indenture Trustee shall, directly or through the Paying Agent,
apply or cause to be applied, pursuant to the written direction of the Master
Servicer, the Negative Carry Account Draw Amount on such Distribution Date and
on the Distribution Date following the Collection Period in which the
Pre-Funding Period ends, distribute any remaining funds on deposit in the
Negative Carry Account to the Collection Account.
Section 8.03. General Provisions Regarding Accounts.
(a) So long as no Default or Event of Default shall have occurred and
be continuing, all or a portion of the funds in the Accounts shall be invested
by the Indenture Trustee at the written direction of the Master Servicer in
Permitted Investments as provided in Sections 4.01, 4.07, 4.08, 4.09 and 4.10
of the Sale and Servicing Agreement. All income or other gain (net of losses
and investment expenses) from investments of monies deposited in the Accounts
shall be withdrawn by the Indenture Trustee, either directly or through the
Paying Agent, from such accounts and distributed (but only under the
circumstances set forth in the Sale and Servicing Agreement) as provided in
Section 4.01, 4.06 or 4.08 of the Sale and Servicing Agreement. The Master
Servicer shall not direct the Indenture Trustee to make any investment of any
funds or to sell any investment held in any of the Accounts unless the
security interest granted and perfected in such account will continue to be
perfected in such investment or the proceeds of such sale, in either case
without any further action by any Person, and, in connection with any
direction to the Indenture Trustee to make any such investment or sale, if
requested by the Indenture Trustee, the Issuer shall deliver to the Indenture
Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to such
effect.
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(b) Subject to Section 6.01(c), the Indenture Trustee shall not in
any way be held liable by reason of any insufficiency in any of the Accounts
resulting from any loss on any Permitted Investment included therein except
for losses attributable to the Indenture Trustee's failure to make payments on
such Permitted Investments issued by the Indenture Trustee, in its commercial
capacity as principal obligor and not as trustee, in accordance with their
terms.
(c) If (i) the Master Servicer shall have failed to give written
investment directions for any funds on deposit in the Accounts to the
Indenture Trustee by 11:00 A.M., New York City time (or such other time as may
be agreed upon by the Issuer and the Indenture Trustee), on the related
Deposit Date or (ii) a Default or Event of Default shall have occurred and be
continuing with respect to the Notes but the Notes shall not have been
declared due and payable pursuant to Section 5.02 or (iii) if the Notes shall
have been declared due and payable following an Event of Default but amounts
collected or receivable from the Trust Estate are being applied in accordance
with Section 5.05 as if there had not been such a declaration, then the
Indenture Trustee upon actual knowledge by a Responsible Officer of the
Indenture Trustee of such event shall, to the fullest extent practicable,
invest and reinvest funds in the Accounts in the one or more Permitted
Investments listed in clause (vii) of the definition of the term "Permitted
Investments".
Section 8.04. Release of Trust Estate.
(a) Subject to the payment of its fees and expenses pursuant to
Section 6.07, the Indenture Trustee may, and when required by the provisions
of this Indenture shall, execute instruments to release property from the lien
of this Indenture, or convey the Indenture Trustee's interest in the same, in
a manner and under circumstances that are not inconsistent with the provisions
of this Indenture. No party relying upon an instrument executed by the
Indenture Trustee as provided in this Article shall be bound to ascertain the
Indenture Trustee's authority, inquire into the satisfaction of any conditions
precedent or see to the application of any monies.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and all sums due the Indenture Trustee pursuant to Section 6.07
have been paid in full, release any remaining portion of the Trust Estate that
secured the Notes from the lien of this Indenture and release to the Issuer or
any other Person entitled thereto any funds then on deposit in the Accounts.
The Indenture Trustee shall release property from the lien of this Indenture
pursuant to this Section only upon receipt of an Issuer Request accompanied by
an Officer's Certificate, an Opinion of Counsel and (if required by the TIA)
Independent Certificates in accordance with TIA Sections 314(c) and 314(d)(1)
meeting the applicable requirements of Section 11.01.
Section 8.05. Opinion of Counsel. The Indenture Trustee shall receive
at least seven days notice when requested by the Issuer to take any action
pursuant to Section 8.04(a), accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, except in connection
with any action contemplated by Section 8.04(b), as a condition to such
action, an Opinion of Counsel, in form and substance satisfactory to the
Indenture Trustee, stating the legal effect of any such action, outlining the
steps required to complete such action, and concluding that all conditions
precedent to the taking of such action have been complied with and such action
will not materially and adversely impair the security for the Notes or the
rights of the Noteholders in contravention of the provisions of this
Indenture; provided, however,
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that such Opinion of Counsel shall not be required to express an opinion as to
the fair value of the Trust Estate. Counsel rendering any such opinion may
rely, without independent investigation, on the accuracy and validity of any
certificate or other instrument delivered to the Indenture Trustee in
connection with any such action.
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ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent of Noteholders.
(a) The Issuer and the Indenture Trustee, when authorized by an
Issuer Order, may, without the consent of any Holders of any Notes but with
the consent of the Rating Agencies, with prior written notice to the Rating
Agencies at any time and from time to time, enter into one or more indentures
supplemental hereto, in form satisfactory to the Indenture Trustee, for any of
the following purposes:
(i) to correct or amplify the description of any property at
any time subject to the lien of this Indenture, or better to assure,
convey and confirm unto the Indenture Trustee any property subject or
required to be subjected to the lien of this Indenture, or to subject
to the lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another Person to the Issuer, and
the assumption by any such successor of the covenants of the Issuer
herein and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit
of the Noteholders, or to surrender any right or power herein
conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture that may be
inconsistent with any other provision herein or in any supplemental
indenture or in any (i) offering document used in connection with the
initial offer and sale of the Notes or to add any provisions to or
change in any manner or eliminate any of the provisions of this
Indenture which will not be inconsistent with other provisions of
this Indenture or (ii) other Basic Document with respect to matters
or questions arising under this Indenture or in any supplemental
indenture;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the
Notes and to add to or change any of the provisions of this Indenture
as shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of
Article Six; or
(vii) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar
federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA;
provided, however, that no such supplemental indenture (i) may materially
adversely affect the interests of any Noteholder and (ii) will be permitted
unless an Opinion of Counsel is delivered to the Indenture Trustee to the
effect that such supplemental indenture will not cause the Issuer to
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be characterized for federal income tax purposes as an association or publicly
traded partnership taxable as a corporation or otherwise have any material
adverse impact on the federal income taxation of any Notes Outstanding or any
Noteholder. A supplemental indenture shall be deemed not to materially
adversely affect the interests of any Noteholder if (i) the Person requesting
such supplemental indenture obtains and delivers to the Indenture Trustee an
Opinion of Counsel to that effect or (ii) the Rating Agency Condition is
satisfied. The Indenture Trustee is hereby authorized to join in the execution
of any such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.
Section 9.02. Supplemental Indentures With Consent of Noteholders.
The Issuer and the Indenture Trustee, when authorized by an Issuer Order, may,
with the consent of the Holders of Notes evidencing not less than 51% of the
Note Balance of the Controlling Class and with prior notice to the Rating
Agencies, by Act of such Holders delivered to the Issuer and the Indenture
Trustee, at any time and from time to time enter into one or more indentures
supplemental hereto for the purpose of adding any provisions to, or changing
in any manner or eliminating any of the provisions of, this Indenture or
modifying in any manner the rights of the Holders of the Notes under this
Indenture; provided, however, that no such supplemental indenture (i) may
materially adversely affect the interests of any Noteholder and (ii) will be
permitted unless an Opinion of Counsel is delivered to the Indenture Trustee
to the effect that such supplemental indenture will not cause the Issuer to be
characterized for federal income tax purposes as an association or publicly
traded partnership taxable as a corporation or otherwise have any material
adverse impact on the federal income taxation of any Notes Outstanding or any
Noteholder; and, provided further, that no such supplemental indenture may,
without the consent of the Holder of each Outstanding Note affected by such
supplemental indenture:
(a) change any Final Scheduled Distribution Date or the date
of payment of any installment of principal of or interest on any
Note, or reduce the principal amount thereof, the Interest Rate
applicable thereto or the Redemption Price with respect thereto,
change the provisions of this Indenture relating to the application
of collections on, or the proceeds of the sale of, the Trust Estate
to payment of principal of or interest on the Notes, or change any
place of payment where, or the coin or currency in which, any Note or
the interest thereon is payable;
(b) impair the right to institute suit for the enforcement
of the provisions of this Indenture requiring the application of
available funds, as provided in Article Five, to the payment of any
amount due on the Notes on or after the respective due dates thereof
(or, in the case of redemption, on or after the Redemption Date);
(c) reduce the percentage of the Note Balance or the Note
Balance of the Controlling Class, the consent of the Holders of Notes
of which is required for any such supplemental indenture, or the
consent of the Holders of Notes of which is required for any waiver
of compliance with the provisions of this Indenture or of defaults
hereunder and their consequences as provided in this Indenture;
(d) modify or alter (A) the provisions of the proviso to the
definition of the term "Outstanding", (B) the definition of the term
"Note Balance" or (C) the definition of the term "Controlling Class";
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(e) reduce the percentage of the Note Balance required to
direct the Indenture Trustee to sell or liquidate the Trust Estate
pursuant to Section 5.04 if the proceeds of such sale would be
insufficient to pay in full the principal amount of and accrued but
unpaid interest on the Notes;
(f) reduce the percentage of the Note Balance of the
Controlling Class the consent of the Holders of Notes of which is
required for any such supplemental indenture amending the provisions
of this Indenture which specify the applicable percentage of the Note
Balance of the Controlling Class the consent of which is required for
such supplemental indenture or the amendment of any other Basic
Document;
(g) affect the calculation of the amount of any interest on
or principal of the Notes payable on any Distribution Date (including
the calculation of any of the individual components of such
calculation);
(h) modify any of the provisions of this Indenture in such a
manner as to affect the rights of the Holders of the Notes to the
benefit of any provisions for the mandatory redemption of the Notes;
or
(i) permit the creation of any lien ranking prior to or on a
parity with the lien of this Indenture with respect to any part of
the Trust Estate or, except as otherwise permitted or contemplated
herein, terminate the lien of this Indenture on any such collateral
at any time subject hereto or deprive the Noteholders of the security
provided by the lien of this Indenture.
The Administrator shall certify to the Indenture Trustee whether or
not any Notes would be affected by any supplemental indenture and any such
certification shall be conclusive upon the Holders of all Notes, whether
theretofore or thereafter authenticated and delivered hereunder.
It shall not be necessary for any Act of Noteholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Indenture Trustee
of any supplemental indenture pursuant to this Section, the Indenture Trustee
shall mail to the Noteholders to which such amendment or supplemental
indenture relates a notice setting forth in general terms the substance of
such supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
Section 9.03. Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article or the modification thereby of the trusts created by
this Indenture, the Indenture Trustee shall be entitled to receive, and
subject to Sections 6.01 and 6.02, shall be fully protected in relying upon,
an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture and that all conditions
precedent in this Indenture to the execution and delivery of such supplemental
indenture have been satisfied. The Indenture Trustee may, but
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shall not be obligated to, enter into any such supplemental indenture that
affects the Indenture Trustee's own rights, duties, liabilities or immunities
under this Indenture or otherwise.
Section 9.04. Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and shall be deemed to be modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective
rights, limitations of rights, obligations, duties, liabilities and immunities
under this Indenture of the Indenture Trustee, the Issuer and the Noteholders
shall thereafter be determined, exercised and enforced hereunder subject in
all respects to such modifications and amendments, and all the terms and
conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.
Section 9.05. Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article shall conform to the requirements of the TIA as then in effect so long
as this Indenture shall then be qualified under the TIA.
Section 9.06. Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the
opinion of the Indenture Trustee and the Issuer, to any such supplemental
indenture may be prepared and executed by the Issuer and authenticated and
delivered by the Indenture Trustee in exchange for Outstanding Notes.
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ARTICLE TEN
REDEMPTION OF NOTES
Section 10.01. Redemption.
(a) The Notes are subject to redemption in whole, but not in part, at
the direction of the Master Servicer pursuant to Section 8.01 of the Sale and
Servicing Agreement, on any Distribution Date on which the Master Servicer
exercises its option to purchase the assets of the Issuer pursuant to said
Section, and the amount paid by the Master Servicer shall be treated as
collections in respect of the Receivables and applied to pay all amounts due
to the Master Servicer under the Sale and Servicing Agreement, all amounts due
to the Trustees and the Paying Agent, and the unpaid principal amount of the
Notes plus accrued and unpaid interest thereon. The Master Servicer or the
Issuer shall furnish each Rating Agency notice of such redemption. If the
Notes are to be redeemed pursuant to this Section, the Master Servicer shall
furnish notice of such redemption to the Seller, the Indenture Trustee, the
Depositor and the Rating Agencies not later than 30 days prior to the
Redemption Date and the Issuer shall deposit by 10:00 A.M., New York City
time, on the Redemption Date with the Indenture Trustee in the Note Payment
Account the Redemption Price of the Notes to be redeemed (all or a portion of
which deposit may be made from Available Funds), whereupon all such Notes
shall be due and payable on the Redemption Date upon the furnishing of a
notice complying with Section 10.02 to each Noteholder.
(b) In the event that the assets of the Issuer are purchased by the
Master Servicer pursuant to Section 8.01(a) of the Sale and Servicing
Agreement, all amounts on deposit in the Note Payment Account shall be paid to
the Noteholders up to the unpaid principal amount of the Notes and all accrued
and unpaid interest thereon. If such amounts are to be paid to Noteholders
pursuant to this Section, the Issuer shall, to the extent practicable, furnish
or cause the Master Servicer to furnish notice of such event to the Depositor,
the Indenture Trustee and the Rating Agencies not later than 30 days prior to
the Redemption Date, whereupon all such amounts shall be payable on the
Redemption Date.
Section 10.02. Form of Redemption Notice. Notice of redemption of the
Notes under Section 10.01 shall be given by the Indenture Trustee by
first-class mail, postage prepaid, or by facsimile transmitted promptly
following receipt of notice from the Issuer or the Master Servicer pursuant to
Section 10.01(a), but not later than ten days prior to the applicable
Redemption Date to each Noteholder, as of the close of business on the Record
Date preceding the applicable Redemption Date, at such Noteholder's address or
facsimile number appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
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(iii) the place where such Notes are to be surrendered for
payment of the Redemption Price (which shall be the office or agency
of the Issuer to be maintained as provided in Section 3.02); and
(iv) that on the Redemption Date, the Redemption Price will
become due and payable upon each Note and that interest thereon shall
cease to accrue from and after the Redemption Date.
Notice of redemption of the Notes shall be given by the Indenture
Trustee in the name and at the expense of the Issuer. Failure to give notice
of redemption, or any defect therein, to any Noteholder shall not impair or
affect the validity of the redemption of any other Note.
Section 10.03. Notes Payable on Redemption Date. The Notes to be
redeemed shall, following notice of redemption as required by Section 10.02,
on the Redemption Date become due and payable at the Redemption Price and
(unless the Issuer shall default in the payment of the Redemption Price) no
interest shall accrue on the Redemption Price for any period after the date to
which accrued interest is calculated for purposes of calculating the
Redemption Price.
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ARTICLE ELEVEN
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions, etc.
(a) Upon any application or request by the Issuer to the Indenture
Trustee to take any action under any provision of this Indenture, the Issuer
shall furnish to the Indenture Trustee (i) an Officer's Certificate stating
that all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with, (ii) an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if
any, have been complied with and (iii) if required by the TIA, an Independent
Certificate from a firm of certified public accountants meeting the applicable
requirements of this Section, except that, in the case of any such application
or request as to which the furnishing of such documents is specifically
required by any provision of this Indenture, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each signatory,
such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as
to whether or not such covenant or condition has been complied with;
and
(iv) a statement as to whether, in the opinion of each
signatory, such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any Collateral or other
property or securities with the Indenture Trustee that is to be made
the basis for the release of any property or securities subject to
the lien of this Indenture, the Issuer shall, in addition to any
obligation imposed in Section 11.01(a) or elsewhere in this
Indenture, deliver to the Indenture Trustee an Officer's Certificate
certifying or stating the opinion of each individual signing such
certificate as to the fair value (within 90 days of such deposit) to
the Issuer of the Collateral or other property or securities to be so
deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the
opinion of any signer thereof as to the matters described in clause
(i) above, the Issuer shall also furnish to the Indenture Trustee an
Independent Certificate as to the same matters, if the fair value to
the Issuer of the
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property or securities to be so deposited and of all other such
securities made the basis of any such withdrawal or release since the
commencement of the then-current fiscal year of the Issuer, as set
forth in the certificates furnished pursuant to clause (i) above and
this clause (ii), is 10% or more of the Note Balance, but such a
certificate need not be furnished with respect to any property or
securities so deposited, if the fair value thereof to the Issuer as
set forth in the related Officer's Certificate is less than $25,000
or less than 1% of the Note Balance.
(iii) Other than with respect to any release described in
clause (A) or (B) of Section 11.01(b)(v), whenever any property or
securities are to be released from the lien of this Indenture, the
Issuer shall also furnish to the Indenture Trustee an Officer's
Certificate certifying or stating the opinion of each person signing
such certificate as to the fair value (within 90 days of such
release) of the property or securities proposed to be released and
stating that in the opinion of such person the proposed release will
not impair the security under this Indenture in contravention of the
provisions hereof.
(iv) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the
opinion of any signer thereof as to the matters described in clause
(iii) above, the Issuer shall also furnish to the Indenture Trustee
an Independent Certificate as to the same matters if the fair value
of the property or securities and of all other property (other than
property described in clauses (A) or (B) of Section 11.01(b)(v))
released from the lien of this Indenture since the commencement of
the then-current calendar year, as set forth in the certificates
required by clause (iii) above and this clause (iv), equals 10% or
more of the Note Balance, but such certificate need not be furnished
in the case of any release of property or securities if the fair
value thereof as set forth in the related Officer's Certificate is
less than $25,000 or less than one percent of the Note Balance at the
time of such release.
(v) Notwithstanding Section 2.13 or any other provision of
this Section, the Issuer may, without compliance with the
requirements of the other provisions of this Section, (A) collect,
liquidate, sell or otherwise dispose of Receivables and Financed
Vehicles as and to the extent permitted or required by the Basic
Documents and (B) make cash payments out of the Accounts as and to
the extent permitted or required by the Basic Documents.
Section 11.02. Form of Documents Delivered to Indenture Trustee.
(a) In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary
that all such matters be certified by, or covered by the opinion of, only one
such Person, or that they be so certified or covered by only one document, but
one such Person may certify or give an opinion with respect to some matters
and one or more other such Persons as to other matters, and any such Person
may certify or give an opinion as to such matters in one or several documents.
(b) Any certificate or opinion of an Authorized Officer of the Issuer
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the
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certificate or opinion or representations with respect to the matters upon
which such officer's certificate or opinion is based are erroneous. Any such
certificate of an Authorized Officer or Opinion of Counsel may be based,
insofar as it relates to factual matters, upon a certificate or opinion of, or
representations by, one or more officers of the Seller, the Master Servicer,
the Depositor, the Issuer or the Administrator, stating that the information
with respect to such factual matters is in the possession of the Seller, the
Master Servicer, the Depositor, the Issuer or the Administrator, unless such
Authorized Officer or counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect
to such matters are erroneous.
(c) Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
(d) Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application
or at the effective date of such certificate or report (as the case may be),
of the facts and opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such application
granted or to the sufficiency of such certificate or report. The foregoing
shall not, however, be construed to affect the Indenture Trustee's right to
rely upon the truth and accuracy of any statement or opinion contained in any
such document as provided in Article Six.
Section 11.03. Acts of Noteholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided
such action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee and, where it is hereby expressly required,
to the Issuer. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Noteholders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 6.01) conclusive in
favor of the Indenture Trustee and the Issuer, if made in the manner provided
in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Note shall bind the Holder of
every Note issued upon the registration thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered
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to be done by the Indenture Trustee or the Issuer in reliance thereon, whether
or not notation of such action is made upon such Note.
Section 11.04. Notices, etc., to Indenture Trustee, Issuer, Depositor
and Rating Agencies. Any request, demand, authorization, direction, notice,
consent, waiver or Act of Noteholders or other documents provided or permitted
by this Indenture shall be in writing and if such request, demand,
authorization, direction, notice, consent, waiver or Act of Noteholders is to
be made upon, given or furnished to or filed with:
(a) the Indenture Trustee by any Noteholder or the Issuer
shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing and sent by first-class mail, postage
prepaid, overnight courier or facsimile (followed by original) to or
with the Indenture Trustee at its Corporate Trust Office;
(b) the Issuer by the Indenture Trustee or any Noteholder
shall be sufficient for every purpose hereunder if in writing and
sent by first-class mail, postage prepaid, overnight courier or
facsimile (followed by original) to the Issuer addressed to: Wachovia
Auto Owner Trust 200__-_, in care of __________, Attention:
___________ (with a copy to the Administrator, ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
17th Floor, Mail code NC 5578, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ABS Deal Administrator), or at any other address
previously furnished in writing to the Indenture Trustee by the
Issuer or the Administrator; the Issuer shall promptly transmit any
notice received by it from the Noteholders to the Indenture Trustee;
or
(c) the Depositor by the Indenture Trustee, the Master
Servicer or any Noteholder, shall be sufficient for every purpose
hereunder if in writing and sent by first-class mail, postage
prepaid, overnight courier or facsimile (followed by original) to the
Depositor addressed to Pooled Auto Securities Shelf LLC, One Wachovia
Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Treasury ABS Department or at any other
address previously furnished in writing to the Indenture Trustee by
the Depositor.
Notices required to be given to each Rating Agency by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered, telecopied, mailed by certified mail, return receipt requested, or
sent by electronic delivery in the case of (i) Moody's, at ▇▇▇▇▇'▇ Investors
Service, Inc., ABS Monitoring Department, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ (e-mail: ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇) or (ii) Standard & Poor's, at
Standard & Poor's Ratings Services, a Division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Asset Backed
Surveillance Department (e-mail: ▇▇▇▇▇▇▇▇_▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇); or at such other
address as shall be designated by written notice to the other parties.
Section 11.05. Notices to Noteholders; Waiver. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and sent by first-class mail, postage prepaid to each Noteholder affected by
such event, at such Noteholder's address as it appears on the Note Register,
not later than the latest date, and not earlier than the earliest date,
prescribed for the giving of such notice.
75
In any case where notice to Noteholders is given by mail, neither the failure
to mail such notice nor any defect in any notice so mailed to any particular
Noteholder shall affect the sufficiency of such notice with respect to other
Noteholders, and any notice that is mailed in the manner herein provided shall
conclusively be presumed to have been duly given.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Noteholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Indenture Trustee shall be deemed
to be a sufficient giving of such notice.
Where this Indenture provides for notice to each Rating Agency,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute a Default
or Event of Default.
Section 11.06. Alternate Payment and Notice Provisions.
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Noteholder
providing for a method of payment, or notice by the Indenture Trustee or any
Paying Agent to such Noteholder, that is different from the methods provided
for in this Indenture for such payments or notices. The Issuer will furnish to
the Indenture Trustee a copy of each such agreement and the Indenture Trustee
will cause payments to be made and notices to be given in accordance with such
agreements.
Section 11.07. Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this Indenture by any of the provisions of the
Trust Indenture Act, such required provision shall control.
The provisions of TIA Sections 310 through 317 that impose duties on
any Person (including the provisions automatically deemed included herein
unless expressly excluded by this Indenture) are a part of and govern this
Indenture, whether or not physically contained herein.
Section 11.08. Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the meaning or interpretation of the terms or provisions
hereof.
Section 11.09. Successors and Assigns. All covenants and agreements
in this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Indenture Trustee
in this Indenture shall bind its successors, co-trustees and agents.
76
Section 11.10. Severability. In case any provision in this Indenture
or in the Notes shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions of this Indenture and
the Notes shall not in any way be affected or impaired thereby.
Section 11.11. Benefits of Indenture; Third Party Beneficiaries.
Nothing in this Indenture or in the Notes, express or implied, shall give to
any Person, other than the parties hereto and their successors hereunder and
the Noteholders, and any other party secured hereunder, and any other Person
with an ownership interest in any part of the Trust Estate, any benefit or any
legal or equitable right, remedy or claim under this Indenture.
Notwithstanding the foregoing, this Indenture shall inure to the benefit of
and be binding upon the parties hereto, and the Owner Trustee, the
Noteholders, the Certificateholders and their respective successors and
permitted assigns shall be third party beneficiaries. Except as otherwise
provided in this Article, no other Person shall have any right or obligation
hereunder.
Section 11.12. Legal Holidays. In any case where the date on which
any payment is due shall not be a Business Day, then (notwithstanding any
other provision of the Notes or this Indenture) payment need not be made on
such date, but may be made on the next succeeding Business Day with the same
force and effect as if made on the date on which nominally due, and no
interest shall accrue for the period from and after any such nominal date.
Section 11.13. GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.14. Counterparts. This Indenture may be executed in any
number of counterparts, each of which when so executed shall be deemed to be
an original, but all of which counterparts shall together constitute but one
and the same instrument.
Section 11.15. Recording of Indenture. If this Indenture is subject
to recording in any appropriate public recording offices, such recording shall
be effected by the Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Indenture Trustee or any other counsel
reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any
other Person secured hereunder or for the enforcement of any right or remedy
granted to the Indenture Trustee under this Indenture.
Section 11.16. Trust Obligation. Except as otherwise provided in
Section 3.07(e), no recourse may be taken, directly or indirectly, with
respect to the obligations of the Issuer, the Owner Trustee or the Indenture
Trustee on the Notes or under this Indenture or any certificate or other
writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee
or of any successor or assign of
77
the Indenture Trustee or the Owner Trustee in its individual capacity, except
as any such Person may have expressly agreed (it being understood that the
Indenture Trustee, except as otherwise provided in Section 3.07(e), and the
Owner Trustee have no such obligations in their individual capacities) and
except that any such partner, owner or beneficiary shall be fully liable, to
the extent provided by applicable law, for any unpaid consideration for stock,
unpaid capital contribution or failure to pay any installment or call owing to
such entity. For all purposes of this Indenture, in the performance of any
duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of
Articles Six, Seven and Eight of the Trust Agreement.
Section 11.17. No Petition. The Indenture Trustee, by entering into
this Indenture, and each Noteholder or Note Owner, by accepting a Note or a
beneficial interest therein, as the case may be, hereby covenant and agree
that they will not at any time institute against the Issuer or the Depositor,
or join in any institution against the Issuer or the Depositor of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or State
bankruptcy or similar law in connection with any obligations relating to the
Notes, this Indenture or any of the other Basic Documents.
Section 11.18. Inspection. The Issuer shall, with reasonable prior
notice, permit any representative of the Indenture Trustee, during the
Issuer's normal business hours, to examine the books of account, records,
reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees, and Independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested. The Indenture
Trustee shall and shall cause its representatives to hold in confidence all
such information except to the extent disclosure may be required by law (and
all reasonable applications for confidential treatment are unavailing) and
except to the extent that the Indenture Trustee may reasonably determine that
such disclosure is consistent with its obligations hereunder.
Section 11.19. Subordination Agreement. Each Noteholder, by accepting
a Note, hereby covenants and agrees that, to the extent it is deemed to have
any interest in any assets of the Depositor, or a securitization vehicle
(other than the Issuer) related to the Depositor, dedicated to other debt
obligations of the Depositor or debt obligations of any other securitization
vehicle (other than the Issuer) related to the Depositor, its interest in
those assets is subordinate to claims or rights of such other debtholders to
those other assets. Furthermore, each Noteholder, by accepting a Note, hereby
covenants and agrees that such agreement constitutes a subordination agreement
for purposes of Section 510(a) of the Bankruptcy Code.
78
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed by their respective officers, thereunto duly authorized, as
of the day and year first above written.
WACHOVIA AUTO OWNER TRUST 200__-_,
By: ____________________,
not in its individual capacity but
solely as Owner Trustee
By:
---------------------------------------
Name:
Title:
---------------------,
not in its individual capacity but solely as
Indenture Trustee
By:
---------------------------------------
Name:
Title:
Indenture
EXHIBIT A
FORM OF CLASS ▇-▇ [▇-▇] [▇-▇] [▇-▇] [A-5] [B] NOTE
[FOR CLASS ▇-▇, ▇-▇, ▇-▇ ▇▇▇ ▇-▇ NOTES: THIS NOTE IS SUBORDINATED IN
RIGHT OF PAYMENT TO THE CLASS A-1 NOTES [, THE CLASS A-2 NOTES] [THE CLASS A-3
NOTES] [AND THE CLASS A-4 NOTES] AS DESCRIBED IN THE INDENTURE REFERRED TO
HEREIN.]
[FOR CLASS B NOTES: THIS NOTE IS SUBORDINATED IN RIGHT OF PAYMENT TO
THE CLASS A NOTES AS DESCRIBED IN THE INDENTURE REFERRED TO HEREIN.]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
THIS NOTE IS NOT A DEPOSIT OR OBLIGATION OF OR AN INTEREST IN
WACHOVIA BANK, NATIONAL ASSOCIATION OR ANY OF ITS AFFILIATES. THIS NOTE IS NOT
GUARANTEED OR INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
GOVERNMENTAL ENTITY OR FUND OF THE UNITED STATES.
[FOR CLASS A NOTES: ANY INVESTOR THAT IS AN EMPLOYEE BENEFIT PLAN OR
OTHER PLAN OR ARRANGEMENT THAT IS SUBJECT TO SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE, BY ITS ACCEPTANCE OF AN INTEREST IN THIS NOTE, WILL BE
DEEMED TO MAKE CERTAIN REPRESENTATIONS.]
[FOR CLASS B NOTES: THIS NOTE MAY NOT BE ACQUIRED BY OR WITH PLAN
ASSETS OF AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN OR ARRANGEMENT THAT IS
SUBJECT TO SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE.]
A-1
REGISTERED $___________
No. R-A1-1 [R-A2-1] [R-A3-1] [R-A4-1] [R-A5-1] [R-B-1] CUSIP NO. ___________
WACHOVIA AUTO OWNER TRUST 200_-_
_____% CLASS ▇-▇ [▇-▇] [▇-▇] [▇-▇] [A-5] [B] ASSET BACKED NOTE
Wachovia Auto Owner Trust 200__-_, a statutory trust organized and
existing under the laws of the State of Delaware (the "Issuer"), for value
received, hereby promises to pay to Cede & Co., or its registered assigns, the
principal sum of ___________________ DOLLARS ($___________), payable to the
extent described in the Indenture referred to on the reverse hereof on each
Distribution Date; provided, however, that the entire unpaid principal amount
of this Note shall be payable on the earlier of _______________, 200__ (the
"Class ▇-▇ [▇-▇] [▇-▇] [▇-▇] [▇-▇] [B] Final Scheduled Distribution Date") and
the Redemption Date, if any, selected pursuant to the Indenture.
The Issuer will pay interest on this Note at the rate per annum shown
above on each Distribution Date until the principal of this Note is paid or
made available for payment, on the principal amount of this Note outstanding
on the preceding Distribution Date (after giving effect to all payments of
principal made on such preceding Distribution Date), or on the Closing Date in
the case of the first Distribution Date or if no interest has yet been paid,
subject to certain limitations contained in the Indenture. Interest on this
Note will accrue for each Distribution Date from, and including, the most
recent Distribution Date on which interest has been paid (or, in the case of
the first Distribution Date or if no interest has yet been paid, from and
including the Closing Date), to but excluding such current Distribution Date.
[For Class A-1 Notes: Interest will be computed on the basis of the actual
number of days during the related Interest Period divided by 360.] [For Class
▇-▇, ▇-▇, ▇-▇, ▇-▇ and B Notes: Interest on this Note will accrue for each
Distribution Date from and including the 20th day of the prior month (or from
and including the Closing Date, in the case of the first Distribution Date or
if no interest has yet been paid) to but excluding the 20th day of the current
month. Interest will be computed on the basis of a 360-day year consisting of
twelve 30-day months.] The Issuer shall pay interest on overdue installments
of interest at the interest rate shown above to the extent lawful. Such
principal and interest on this Note shall be paid in the manner specified on
the reverse hereof.
The principal and interest on this Note are payable in such coin or
currency of the United States as at the time of payment is legal tender for
payment of public and private debts. All payments made by the Issuer with
respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual or facsimile
signature, this Note shall not be entitled to any benefit under the Indenture,
or be valid or obligatory for any purpose.
A-2
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by an Authorized Officer, as of the date set
forth below.
Date: ______, 200_ WACHOVIA AUTO OWNER TRUST 200_-_
By: _______________________________,
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement
By:
------------------------------------
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: ________, 200_ ______________________,
not in its individual capacity but solely
as Indenture Trustee,
By:
------------------------------------
Authorized Signatory
A-3
[REVERSE OF CLASS ▇-▇ [▇-▇] [▇-▇] [▇-▇] [A-5] [B] NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its _____% Class ▇-▇ [▇-▇] [▇-▇] [▇-▇] [A-5] [B] Asset Backed
Notes (the "Class A-[___] Notes"), all issued under the Indenture, dated as of
_________, 200_ (the "Indenture"), between the Issuer and ______________, as
trustee (the "Indenture Trustee"), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the
respective rights and obligations thereunder of the Issuer, the Indenture
Trustee and the Noteholders. The Notes are subject to all terms of the
Indenture. Capitalized terms used herein that are not otherwise defined shall
have the meanings ascribed thereto in the Indenture, which also contains rules
as to construction that shall be applicable hereto.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the
Class A-4 Notes, the Class A-5 Notes and the Class B Notes (collectively, the
"Notes") are, except as otherwise provided in the Indenture or in the Sale and
Servicing Agreement, equally and ratably secured by the Collateral pledged as
security therefor as provided in the Indenture.
Principal payable on the Class ▇-▇ [▇-▇] [▇-▇] [▇-▇] [A-5] [B] Notes
will be paid on each Distribution Date in the amount specified in the
Indenture and in the Sale and Servicing Agreement. As described above, the
entire unpaid principal amount of this Note will be payable on the earlier of
the Class ▇-▇ [▇-▇] [▇-▇] [▇-▇] [A-5] [B] Final Scheduled Distribution Date
and the Redemption Date, if any, selected pursuant to the Indenture.
Notwithstanding the foregoing, under certain circumstances, the entire unpaid
principal amount of the Class ▇-▇ [▇-▇] [▇-▇] [▇-▇] [A-5] [B] Notes shall be
due and payable following the occurrence and continuance of an Event of
Default, if the Indenture Trustee or the Holders of Notes evidencing not less
than 51% of the Note Balance of the Controlling Class have declared the Notes
to be immediately due and payable in the manner provided in Section 5.02 of
the Indenture. All principal payments on the Class ▇-▇ [▇-▇] [▇-▇] [▇-▇] [A-5]
[B] Notes shall be made pro rata to the Class ▇-▇ [▇-▇] [▇-▇] [▇-▇] [▇-▇] [B]
Noteholders entitled thereto.
Payments of principal and interest on this Note due and payable on
each Distribution Date or Redemption Date shall be made by check mailed to the
Person whose name appears as the registered Noteholder (or one or more
Predecessor Notes) on the Note Register as of the close of business on the
related Record Date, except that with respect to Notes registered on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more Predecessor
Notes) effected by any payments made on any Distribution Date or Redemption
Date shall be binding upon all future Noteholders of this Note and of any Note
issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof, whether or not noted hereon. If funds are expected to be
available, as provided in the Indenture, for payment in full of the remaining
unpaid principal amount of this Note on a Distribution Date or Redemption
Date, then the Indenture Trustee, in the name of and on behalf of the Issuer,
will notify the Person who was the registered Noteholder as of the Record Date
preceding such Distribution Date or Redemption Date by notice mailed within 30
days of such
A-4
Distribution Date or Redemption Date and the amount then due and payable shall
be payable only upon presentation and surrender of this Note at the Corporate
Trust Office of the Indenture Trustee or at the office of the Indenture
Trustee's agent appointed for such purposes located in the City of New York.
As provided in the Indenture, the Notes may be redeemed, in whole but
not in part, in the manner and to the extent described in the Indenture and
the Sale and Servicing Agreement.
As provided in the Indenture and subject to the limitations set forth
therein and on the face hereof, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Noteholder or such
Noteholder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, all in accordance with the Exchange Act, and thereupon one
or more new Notes of authorized denominations and in the same aggregate
principal amount will be issued to the designated transferee or transferees.
No service charge will be charged for any registration of transfer or exchange
of this Note, but the transferor may be required to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any such registration of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or a
beneficial interest therein, as the case may be, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or
under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Indenture Trustee or the Owner Trustee,
each in its individual capacity, (ii) any owner of a beneficial interest in
the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director
or employee of the Indenture Trustee or the Owner Trustee, each in its
individual capacity, any holder of a beneficial interest in the Issuer, the
Owner Trustee or the Indenture Trustee or of any successor or assign of the
Indenture Trustee or the Owner Trustee, each in its individual capacity,
except as any such Person may have expressly agreed and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or a
beneficial interest therein, as the case may be, covenants and agrees by
accepting the benefits of the Indenture and such Note that such Noteholder or
Note Owner will not at any time institute against the Depositor or the Issuer,
or join in any institution against the Depositor or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
under any United States federal or State bankruptcy or similar law in
connection with any obligations relating to the Notes, the Certificates, the
Indenture or the other Basic Documents.
[For Class ▇-▇, ▇-▇, ▇-▇, ▇-▇ and A-5 Notes: A fiduciary of a Benefit
Plan purchasing the Class ▇-▇, ▇-▇, ▇-▇, ▇-▇ or A-5 Notes with the assets of a
Benefit Plan is deemed to represent that the purchase of one or more Notes is
consistent with its fiduciary duties under
A-5
ERISA and does not result in a nonexempt prohibited transaction as defined in
Section 406 of ERISA or Section 4975 of the Code.]
[For the Class B Notes: Each person acquiring a Class B Note is
deemed to represent that such person is not an employee benefit plan (as such
term is defined in Section 3(3) of ERISA) that is subject to the provisions of
Title I or ERISA, a plan described in Section 4975(e)(1) of the Code and that
is not exempt under Section 4975(g) of the Code, any entity whose underlying
assets include plan assets by reason of a plan's investment in the entity or a
person investing on behalf of, or with, plan assets of such a plan.]
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, State and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness of the
Issuer secured by the Trust Estate. Each Noteholder, by acceptance of a Note
(and each Note Owner by acceptance of a beneficial interest in a Note), agrees
to treat the Notes for federal, State and local income, single business and
franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note shall be overdue, and none of the Issuer, the Indenture Trustee or
any such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and the rights of the Noteholders under the Indenture at any time
by the Issuer with the consent of the Holders of Notes representing at least
51% of the Note Balance of the Controlling Class. The Indenture also contains
provisions permitting the Noteholders representing specified percentages of
the Note Balance of the Controlling Class, on behalf of all Noteholders, to
waive compliance by the Issuer with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Noteholder of this Note (or any one of more
Predecessor Notes) shall be conclusive and binding upon such Noteholder and
upon all future Noteholders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note. The
Indenture also permits the Issuer and the Indenture Trustee to amend or waive
certain terms and conditions set forth in the Indenture without the consent of
the Noteholders.
The Indenture permits the Issuer, under certain circumstances, to
consolidate or merge with or into another Person, subject to the rights of the
Indenture Trustee and the Noteholders under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions (other than Section 5-1401 of the
General Obligations Law), and the
A-6
obligations, rights and remedies of the parties hereunder and thereunder shall
be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency herein prescribed.
A-7
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
________________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:
________________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably
constitutes and appoints
________________________________________________________________________________
attorney, to transfer said Note on the books kept for registration thereof,
with full power of substitution in the premises.
Dated: *
-------------------------------- -------------------------------
Signature Guaranteed:
*
--------------------------------
---------
* NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in
every particular, without alteration, enlargement or any change
whatsoever. Such signature must be guaranteed by an "eligible guarantor
institution" meeting the requirements of the Note Registrar.
A-8