DRAFT OF MAY 28, 1999
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HOUSEHOLD AUTOMOTIVE TRUST III
Issuer
INDENTURE
Dated as of June 1, 1999
HOUSEHOLD FINANCE CORPORATION
Master Servicer
THE CHASE MANHATTAN BANK
Trustee
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TABLE OF CONTENTS
PAGE
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ARTICLE I. Definitions and Incorporation by Reference1
SECTION 1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . .1
SECTION 1.2 Incorporation by Reference of the Trust Indenture Act . . . . . .6
SECTION 1.3 Rules of Construction . . . . . . . . . . . . . . . . . . . . . .7
SECTION 1.4 Action by or Consent of Noteholders and Certificateholders. . . .7
SECTION 1.5 Conflict with TIA . . . . . . . . . . . . . . . . . . . . . . . .7
ARTICLE II. The Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
SECTION 2.1 Form; Amount Limited; Issuable in Series. . . . . . . . . . . . .7
SECTION 2.2 Execution, Authentication and Delivery. . . . . . . . . . . . . .8
SECTION 2.3 Temporary Notes . . . . . . . . . . . . . . . . . . . . . . . . .9
SECTION 2.4 Registration; Registration of Transfer and Exchange . . . . . . .9
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes. . . . . . . . . . . 11
SECTION 2.6 Persons Deemed Owner. . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.7 Payment of Principal and Interest; Defaulted Interest . . . . . 13
SECTION 2.8 Cancellation. . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.9 Release of Collateral . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.10 Book-Entry Notes. . . . . . . . . . . . . . . . . . . . . . . . 14
ECTION 2.11 Notices to Clearing Agency. . . . . . . . . . . . . . . . . . . 15
SECTION 2.12 Definitive Notes. . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.13 Final Distribution. . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE III. Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.1 Payment of Principal and Interest . . . . . . . . . . . . . . . 17
SECTION 3.2 Maintenance of Office or Agency . . . . . . . . . . . . . . . . 17
SECTION 3.3 Money for Payments to be Held in Trust. . . . . . . . . . . . . 17
SECTION 3.4 Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.5 Protection of Trust Property. . . . . . . . . . . . . . . . . . 19
SECTION 3.6 Opinions as to Trust Property . . . . . . . . . . . . . . . . . 20
SECTION 3.7 Performance of Obligations; Servicing of Receivables. . . . . . 20
SECTION 3.8 Negative Covenants. . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 3.9 Annual Statement as to Compliance . . . . . . . . . . . . . . . 22
SECTION 3.10 Issuer May Consolidate, Etc. Only on Certain Terms. . . . . . . 22
SECTION 3.11 Successor or Transferee . . . . . . . . . . . . . . . . . . . . 24
SECTION 3.12 No Other Business . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 3.13 No Borrowing. . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.14 Master Servicer's Obligations . . . . . . . . . . . . . . . . . 25
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities . . . . . . . 25
SECTION 3.16 Capital Expenditures. . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.17 Compliance with Laws. . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.18 Restricted Payments . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.19 Notice of Events of Default . . . . . . . . . . . . . . . . . . 26
SECTION 3.20 Further Instruments and Acts. . . . . . . . . . . . . . . . . . 26
SECTION 3.21 Amendments of Master Sale and Servicing Agreement and
Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . 26
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SECTION 3.22 Income Tax Characterization . . . . . . . . . . . . . . . . . . 26
ARTICLE IV. Satisfaction and Discharge . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 4.1 Satisfaction and Discharge of Indenture . . . . . . . . . . . . 26
SECTION 4.2 Application of Trust Money. . . . . . . . . . . . . . . . . . . 27
SECTION 4.3 Repayment of Monies Held by Note Paying Agent . . . . . . . . . 27
ARTICLE V. Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 5.1 Events of Default . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 5.2 Collection of Indebtedness and Suits for Enforcement by Trustee 28
SECTION 5.3 Limitation of Suits . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 5.4 Unconditional Rights of Noteholders To Receive Principal
and Interest. . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 5.5 Restoration of Rights and Remedies. . . . . . . . . . . . . . . 31
SECTION 5.6 Rights and Remedies Cumulative. . . . . . . . . . . . . . . . . 31
SECTION 5.7 Delay or Omission Not a Waiver. . . . . . . . . . . . . . . . . 31
SECTION 5.8 Control by Noteholders. . . . . . . . . . . . . . . . . . . . . 31
SECTION 5.9 Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . 31
SECTION 5.10 Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . 32
SECTION 5.11 Waiver of Stay or Extension Laws. . . . . . . . . . . . . . . . 32
SECTION 5.12 Action on Notes . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 5.13 Performance and Enforcement of Certain Obligations. . . . . . . 33
ARTICLE VI. The Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 6.1 Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 6.2 Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 6.3 Individual Rights of Trustee. . . . . . . . . . . . . . . . . . 37
SECTION 6.4 Trustee's Disclaimer. . . . . . . . . . . . . . . . . . . . . . 37
SECTION 6.5 Notice of Defaults. . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 6.6 Reports by Trustee to Holders . . . . . . . . . . . . . . . . . 37
SECTION 6.7 Compensation and Indemnity. . . . . . . . . . . . . . . . . . . 37
SECTION 6.8 Replacement of Trustee. . . . . . . . . . . . . . . . . . . . . 38
SECTION 6.9 Successor Trustee by ▇▇▇▇▇▇ . . . . . . . . . . . . . . . . . . 39
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee . . . . . . . . . 40
SECTION 6.11 Eligibility: Disqualification . . . . . . . . . . . . . . . . . 41
SECTION 6.12 Preferential Collection of Claims Against Issuer. . . . . . . . 41
SECTION 6.13 Representations and Warranties of the Trustee . . . . . . . . . 41
SECTION 6.14 Waiver of Setoffs . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 6.15 No Consent to Certain Acts of Seller. . . . . . . . . . . . . . 42
ARTICLE VII. Noteholders' Lists and Reports. . . . . . . . . . . . . . . . . . . . 42
SECTION 7.1 Issuer To Furnish To Trustee Names and Addresses of Noteholders 42
SECTION 7.2 Preservation of Information; Communications to Noteholders. . . 43
SECTION 7.3 Reports by Issuer . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 7.4 Reports by Trustee. . . . . . . . . . . . . . . . . . . . . . . 44
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ARTICLE VIII. Accounts, Disbursements and Releases . . . . . . . . . . . . . . . . 44
SECTION 8.1 Collection of Money . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 8.2 Release of Trust Property . . . . . . . . . . . . . . . . . . . 44
SECTION 8.3 Opinion of Counsel. . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE IX. Amendments; Series Supplements . . . . . . . . . . . . . . . . . . . . 45
SECTION 9.1 Amendments Without Consent of Noteholders . . . . . . . . . . . 45
SECTION 9.2 Amendments With Consent of Noteholders. . . . . . . . . . . . . 46
SECTION 9.3 Supplements Authorizing a Series of Notes . . . . . . . . . . . 48
SECTION 9.4 Execution of Series Supplements . . . . . . . . . . . . . . . . 48
SECTION 9.5 Effect of Series Supplement . . . . . . . . . . . . . . . . . . 48
SECTION 9.6 Conformity With Trust Indenture Act . . . . . . . . . . . . . . 48
SECTION 9.7 Reference in Notes to Series Supplements. . . . . . . . . . . . 48
ARTICLE X. Reserved. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE XI. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 11.1 Compliance Certificates and Opinions, etc.. . . . . . . . . . . 49
SECTION 11.2 Form of Documents Delivered to Trustee. . . . . . . . . . . . . 51
SECTION 11.3 Acts of Noteholders . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 11.4 Notices, etc., to Trustee, Issuer and Rating Agencies . . . . . 52
SECTION 11.5 Notices to Noteholders; Waiver. . . . . . . . . . . . . . . . . 52
SECTION 11.6 Alternate Payment and Notice Provisions . . . . . . . . . . . . 53
SECTION 11.7 Conflict with Trust Indenture Act . . . . . . . . . . . . . . . 53
SECTION 11.8 Effect of Headings and Table of Contents. . . . . . . . . . . . 54
SECTION 11.9 Successors and Assigns. . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.10 Separability. . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.11 Benefits of Indenture . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.12 Legal Holidays. . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.13 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.14 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.15 Recording of Indenture. . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.16 Trust Obligation. . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.17 No Petition . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.18 Limited Recourse. . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.19 Inspection. . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 11.20 Limitation of Liability . . . . . . . . . . . . . . . . . . . . 56
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INDENTURE dated as of June 1, 1999, between HOUSEHOLD AUTOMOTIVE
TRUST III, a Delaware business trust (the "Issuer"), HOUSEHOLD FINANCE
CORPORATION, a Delaware corporation (the "Master Servicer") and THE CHASE
MANHATTAN BANK, a New York banking corporation, as trustee (the "Trustee").
In consideration of the mutual agreements contained herein, and
of other good and valuable consideration the receipt and adequacy of which are
hereby acknowledged, the parties agree as follows:
GRANTING CLAUSE
In order to secure the due and punctual payment of the principal
of and interest on the Notes of the related Series when and as the same shall
become due and payable, whether as scheduled, by declaration of acceleration,
prepayment or otherwise, according to the terms of this Indenture, the related
Series Supplement and the related Notes, the Issuer, pursuant to the related
Series Supplement, shall pledge the related Series Trust Estate to the Trustee,
all for the benefit of the Trustee for the benefit of the Holders of the related
Series.
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Definitions. Except as otherwise specified
herein, the following terms have the respective meanings set forth below for
all purposes of this Indenture.
"Act" has the meaning specified in Section 11.3(a).
"Authorized Officer" means, with respect to the Issuer and the
Master Servicer, any officer or agent acting pursuant to a power of attorney of
the Owner Trustee or the Master Servicer, as applicable, who is authorized to
act for the Owner Trustee or the Master Servicer, as applicable, in matters
relating to the Issuer and who is identified on the list of Authorized Officers
delivered by each of the Owner Trustee and the Master Servicer to the Trustee on
the Closing Date (as such list may be modified or supplemented from time to time
thereafter).
"Book Entry Notes" means any 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.
"Class" means, with respect to any Series, all the Notes of such
Series having the same specified payment terms and priority of payment.
"Class SV Preferred Stock" means the preferred stock of the
Seller.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
"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.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time, and Treasury Regulations promulgated thereunder.
"Corporate Trust Office" means the principal office of the
Trustee at which at any particular time its corporate trust business shall be
administered which office at date of the execution of this Agreement is located
at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Structured Finance Services or at such other address as the Trustee may
designate from time to time by notice to the Noteholders, the Master Servicer
and the Issuer, or the principal corporate trust office of any successor Trustee
(the address of which the successor Trustee will notify the Noteholders and the
Issuer).
"Default" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.
"Definitive Notes" has the meaning specified in Section 2.12.
"Event of Default" has the meaning specified in Section 5.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Executive Officer" means, with respect to any corporation, the
Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, Executive Vice President, any Vice President, the Secretary, the
Treasurer, or any Assistant Treasurer of such corporation.
"Grant" means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, ▇▇▇▇▇ ▇ ▇▇▇▇ upon and a
security interest in and right of set-off against, deposit, set over and confirm
pursuant to this Indenture. A Grant of a Series Trust Estate or of any other
agreement or instrument shall include all rights, powers and options (but none
of the obligations) of the granting party thereunder, including the immediate
and continuing right to claim for, collect, receive and give receipt for
principal and interest payments in respect of a Series Trust Estate 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.
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"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Note Register.
"Indebtedness" means, with respect to any Person at any time, (a)
indebtedness or liability of such Person for borrowed money whether or not
evidenced by bonds, debentures, notes or other instruments, or for the deferred
purchase price of property or services (including trade obligations); (b)
obligations of such Person as lessee under leases which should have been or
should be, in accordance with generally accepted accounting principles, recorded
as capital leases; (c) current liabilities of such Person in respect of unfunded
vested benefits under plans covered by Title IV of ERISA; (d) obligations issued
for or liabilities incurred on the account of such Person; (e) obligations or
liabilities of such Person arising under acceptance facilities; (f) obligations
of such Person under any guarantees, endorsements (other than for collection or
deposit in the ordinary course of business) and other contingent obligations to
purchase, to provide funds for payment, to supply funds to invest in any Person
or otherwise to assure a creditor against loss; (g) obligations of such Person
secured by any lien on property or assets of such Person, whether or not the
obligations have been assumed by such Person; or (h) obligations of such Person
under any interest rate or currency exchange agreement.
"Independent" means, when used with respect to any specified
Person, that the person (a) is in fact independent of the Issuer, any other
obligor upon the Notes, the Seller and any Affiliate of any of the foregoing
persons, (b) does not have any direct financial interest or any material
indirect financial interest in the Issuer, any such other obligor, the Seller or
any Affiliate of any of the foregoing Persons and (c) is not connected with the
Issuer, any such other obligor, the Seller or any Affiliate of any of the
foregoing Persons as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions.
"Independent Certificate" means a certificate or opinion to be
delivered to the Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.1, prepared by an
Independent appraiser or other expert appointed pursuant to an Issuer Order and
approved by the 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.
"Issuer Order" and "Issuer Request" means a written order or
request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Trustee.
"Master Sale and Servicing Agreement" means the Master Sale and
Servicing Agreement dated as of June 1, 1999, among the Issuer, the Seller, the
Master Servicer and the Trustee, as the same may be amended or supplemented from
time to time.
"Note" means any Note authenticated and delivered under this
Indenture.
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"Note Owner" means, with respect to a Book-Entry Note, the person
who is the 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 Paying Agent" means the Trustee or any other Person that
meets the eligibility standards for the Trustee specified in Section 6.11 and is
authorized by the Issuer to make payments to and distributions from the Master
Collection Account and the Series 1999-1 Note Account, including payment of
principal of or interest on the Notes on behalf of the Issuer.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.4.
"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 Section 11.1 and TIA
Section 314, and delivered to the Trustee. Unless otherwise specified, any
reference in this Indenture to an Officer's Certificate shall be to an Officer's
Certificate of any Authorized Officer of the Issuer. Each certificate with
respect to compliance with a condition or covenant provided for in this
Agreement shall include (1) a statement that the Authorized Officer signing the
certificate has read such covenant or condition; (2) a brief statement as to the
nature and scope of the examination or investigation upon which the statements
contained in such certificate are based; (3) a statement that in the opinion of
such person, he has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such covenant or
condition has been complied with; and (4) a statement as to whether or not, in
the opinion of such person, such condition or covenant has been complied with.
"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 Trustee or
any Note Paying Agent in trust for the Holders of such Notes (PROVIDED,
HOWEVER, that if such Notes are to be redeemed, notice of such
redemption has been duly given pursuant to a Series Supplement or
provision therefor, satisfactory to the Trustee, has been made); and
(iii) Notes in exchange for or in lieu of other Notes which
have been authenticated and delivered pursuant to this Indenture unless
proof satisfactory to the Trustee is presented that any such Notes are
held by a bona fide purchaser;
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PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
Outstanding Amount of the Notes have given any request, demand, authorization,
direction, notice, consent or waiver hereunder or under any Basic Document,
Notes owned by the Issuer, any other obligor upon the Notes, the Seller or any
Affiliate of any of the foregoing Persons shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Notes that a Responsible Officer of the Trustee
either actually knows to be so owned or has received written notice thereof
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 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 Seller or
any Affiliate of any of the foregoing Persons.
"Outstanding Amount" means the aggregate principal amount of all
Notes, or Class of Notes, as applicable, outstanding at the date of
determination.
"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 2.5 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.
"Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.
"Record Date" means, with respect to a Distribution Date, the
close of business on the Business Day immediately preceding such Distribution
Date. However, if Definitive Notes are issued, the Record Date shall be the
last Business Day of the month preceding a Distribution Date.
"Registration Statement" has the meaning specified therefor in
the Securities Act.
"Responsible Officer" means, with respect to the Trustee or the
Owner Trustee (as defined in the Trust Agreement), any officer within the
Corporate Trust Office of the Trustee or the Owner Trustee, as the case may be,
including any Vice President, Assistant Vice President, Assistant Treasurer,
Assistant Secretary, Financial Services Officer or any other officer of the
Trustee or the Owner Trustee, as the case may be, customarily performing
functions similar to those performed by any of the above designated officers and
having direct responsibility for the administration of this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
5
"State" means any one of the 50 states of the United States of
America or the District of Columbia.
"Tranche" means all of the Notes of a Series (or a Class within a
Series) having the same date of authentication.
"Trust Agreement" means the Trust Agreement dated as of June 1,
1999 between the Seller and the Owner Trustee, as the same may be amended and
supplemented from time to time.
"Trust Property" 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 Trustee), including all proceeds thereof.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of
1939, as amended and as in force on the date hereof, unless otherwise
specifically provided.
"Trustee" means, initially, The Chase Manhattan Bank, a New York
banking corporation, not in its individual capacity but as trustee under this
Indenture, or any successor trustee under this Indenture.
"Trustee Fee" means the fees due to the Trustee, as may be set
forth in that certain fee letter, dated as of the date hereof between the Master
Servicer and The Chase Manhattan Bank.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from time
to time.
"Unregistered Note" means a Note which is not being offered for
sale hereunder pursuant to a Registration Statement.
Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to them in the Master Sale and Servicing
Agreement or the Trust Agreement.
Section 1.2 Incorporation by Reference of the Trust
Indenture Act. Whenever this Indenture refers to a provision of the TIA, the
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:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
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"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Issuer.
All other TIA terms used in this Indenture that are defined by
the TIA, or defined by Commission rule have the meaning assigned to them by such
definitions.
Section 1.3 Rules of Construction. 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;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation; and
(v) words in the singular include the plural and words in the
plural include the singular.
Section 1.4 Action by or Consent of Noteholders and
Certificateholders. Whenever any provision of this Agreement refers to action
to be taken, or consented to, by Noteholders or Certificateholders, such
provision shall be deemed to refer to the Certificateholder or Noteholder, as
the case may be, of record as of the Record Date immediately preceding the
date on which such action is to be taken, or consent given, by Noteholders or
Certificateholders. Solely for the purposes of any action to be taken, or
consented to, by Noteholders or Certificateholders, any Note or Certificate
registered in the name of Seller or any Affiliate thereof shall be deemed not
to be outstanding (except in the event that the Seller and/or an Affiliate
thereof then owns all outstanding Notes and Certificates); PROVIDED, HOWEVER,
that, solely for the purpose of determining whether the Trustee is entitled
to rely upon any such action or consent, only Notes or Certificates which the
Owner Trustee or the Trustee, respectively, knows to be so owned shall be so
disregarded.
Section 1.5 Conflict with TIA. If this Indenture is
qualified under the TIA, and if any provision hereof limits, qualifies or
conflicts with a provision of the TIA that is required under the TIA to be
part of and govern this Indenture, the latter provision shall control. If
any provision of this Indenture modifies or excludes any provision of the TIA
that may be so modified or excluded, the latter provisions shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
7
ARTICLE II.
THE NOTES
Section 2.1 FORM; AMOUNT LIMITED; ISSUABLE IN SERIES.
(a) Notes of each Series, together with the Trustee's
certificate of authentication, shall be in substantially the form set forth in
the related Series Supplement, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture or the related Series Supplement 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.
The 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 officers executing such Notes,
as evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication. The
terms of the Notes set forth in the related Series Supplement are part of the
terms of this Indenture.
(b) The aggregate principal amount of Notes which may be
authenticated and delivered and Outstanding at any time under this Indenture is
not limited; PROVIDED that any Series Supplement may so limit the aggregate
principal amount of Notes of the related Series. The Notes shall be issued in
one or more Series, and may be issued in Classes and/or Tranches within a Series
(and Tranches within a Class).
No Series of Notes shall be issued under this Indenture unless
such Notes have been authorized pursuant to a Series Supplement, and all
conditions precedent to the issuance thereof, as specified in the related Series
Supplement, shall have been satisfied.
All Notes of each Series issued under this Indenture shall be in
all respects equally and ratably entitled to the benefits hereof and secured by
the related Series Trust Estate without preference, priority or distinction on
account of the actual time or times of authentication and delivery, all in
accordance with the terms and provisions hereof and the related Series
Supplement.
Section 2.2 Execution, Authentication and Delivery. The
Notes shall be executed on behalf of the Issuer by any of its Authorized
Officers. The signature of any such Authorized Officer on the Notes may be
original or facsimile.
Notes bearing the original 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
8
authentication and delivery of such Notes or did not hold such offices at the
date of such Notes.
At any time and from time to time after the execution and
delivery of this Indenture and the related Series Supplement, and upon
satisfaction of all the conditions set forth in the related Series Supplement,
the Trustee shall, upon receipt of an Issuer Order and an Officer's Certificate
prepared and delivered by the Master Servicer that all conditions precedent for
such issuance have been satisfied, deliver Notes of the related Series
(including Notes of any Class or Tranche within such Series.)
The Notes of a Series shall be issuable in the denominations
specified in the related Series Supplement.
No Note shall be entitled to any benefit under this Indenture or
any Series Supplement or be valid or obligatory for any purpose, unless there
appears attached to such Note a certificate of authentication substantially in
the form provided for herein executed by the Trustee by the manual signature of
one of its authorized signatories, and such certificate attached to any Note
shall be conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered hereunder.
Section 2.3 Temporary Notes. Pending the preparation of
Definitive Notes of any Series (or of any Class or Tranche within a Series),
the Issuer may execute, and upon receipt of an Issuer Order prepared and
delivered by the Master Servicer, the Trustee shall authenticate and deliver,
temporary Notes which 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.
If temporary Notes of any Series (or of any Class or Tranche
within a Series) are issued, the Issuer will cause Definitive Notes of such
Series (or Class or Tranche) to be prepared without unreasonable delay. After
the preparation of Definitive Notes of such Series (or Class or Tranche), the
temporary Notes shall be exchangeable for Definitive Notes of such Series (or
Class or Tranche) upon surrender of the temporary Notes at the office or agency
of the Issuer to be maintained as provided in Section 3.2, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Notes, the
Issuer shall execute and the Trustee shall authenticate and deliver in exchange
therefor a like principal amount of Definitive Notes of such Series (or Class or
Tranche) of authorized denominations. Until so exchanged, the temporary Notes
of any Series (or Class or Tranche) shall in all respects be entitled to the
same benefits under this Indenture and the related Series Supplement as
Definitive Notes of such Series (or Class or Tranche).
Section 2.4 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
9
the registration of transfers of Notes. The Trustee shall be "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.
If a Person other than the Trustee is appointed by the Issuer as
Note Registrar, the Issuer will give the 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 Trustee shall have the right to inspect
the Note Register at all reasonable times and to obtain copies thereof. The
Trustee shall have the right to rely upon a certificate executed on behalf of
the Note Registrar by an Authorized Officer thereof as to the names and
addresses of the Holders of the Notes and the principal amounts and number of
such Notes.
Upon surrender for registration or transfer of any Note at the
office or agency of the Issuer to be maintained as provided in Section 3.2, and
if the requirements of Section 8-401(1) of the UCC are met, the Issuer shall
execute and cause the Trustee to authenticate one or more new Notes, in any
authorized denominations, of the same class and a like aggregate principal
amount. A Noteholder may also obtain from the Trustee, in the name of the
designated transferee or transferees one or more new Notes, in any authorized
denominations, of the same Class and Tranche, as applicable, and a like
aggregate principal amount. Such requirements shall not be deemed to create a
duty in the Trustee to monitor the compliance by the Issuer with Section 8-401
of the UCC.
At the option of the Holder, Notes of a Series (or Class or
Tranche) may be exchanged for other Notes of such Series (or Class or Tranche)
in any authorized denominations, of the same Class (and Tranche, if applicable)
and 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, and if the requirements of Section 8-401(1) of the UCC are met, the
Issuer shall execute and upon its written request the Trustee shall authenticate
the Notes which the Noteholder making the exchange is entitled to receive. Such
requirements shall not be deemed to create a duty in the Trustee to monitor the
compliance by the Issuer with Section 8-401 of the UCC.
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 and the related Series
Supplement, as the Notes surrendered upon such registration of transfer or
exchange.
Unless specified in a Series Supplement, every Note presented or
surrendered for registration of transfer or exchange shall, unless specified in
a Series Supplement, be (i) duly endorsed by, or be accompanied by a written
instrument of transfer in the form attached as an exhibit to the Note duly
executed by the Holder thereof or such Holder's attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar which requirements include
membership or participation in Securities Transfer Agents
10
Medallion Program ("Stamp") or such other "signature guarantee program" as may
be determined by the Note Registrar in addition to, or in substitution for,
Stamp, all in accordance with the Exchange Act, and (ii) accompanied by such
other documents as the Note Registrar may require.
No service charge shall be made to a Holder for any registration
of transfer or exchange of Notes, but the Note Registrar may require payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of Notes.
Notwithstanding, the preceding provisions of this section, the
Issuer shall not be required to make, and the Note Registrar shall not register,
transfers or exchanges of Notes selected for redemption for a period of 15 days
preceding the Distribution Date.
Any Noteholder using the assets of (i) an employee benefit plan
(as defined in Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")) that is subject to the provisions of Title I of
ERISA, (ii) a plan described in Section 4975(e)(1) of the Internal Revenue Code
of 1986, as amended, or (iii) any entity whose underlying assets include plan
assets by reason of a plan's investment in the entity to purchase the Notes, or
to whom the Notes are transferred, will be deemed to have represented that the
acquisition and continued holding of the Notes will be covered by a U.S.
Department of Labor Class Exemption.
(b) No Holder of an Unregistered Note shall transfer its
Note, unless (i) such transfer is made in accordance with Rule 144A under the
Securities Act or (ii) pursuant to an exemption from registration provided by
Rule 144 under the Securities Act (if available) and the registration and
qualification requirements under applicable state securities laws.
Each Unregistered Note issued hereunder will contain the
following legend limiting sales to "Qualified Institutional Buyers" within the
meaning of Rule 144A under the Securities Act:
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR REGULATORY AUTHORITY OF ANY STATE. THIS NOTE HAS BEEN
OFFERED AND SOLD PRIVATELY. THE HOLDER HEREOF ACKNOWLEDGES THAT THESE
SECURITIES ARE "RESTRICTED SECURITIES" THAT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT AND AGREES FOR THE BENEFIT OF THE OBLIGORS AND
ITS AFFILIATES THAT THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED EXCEPT (A) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED
11
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES
ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A OR (B)
PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER
THE SECURITIES ACT (IF AVAILABLE), IN EACH CASE IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER JURISDICTION.
Section 2.5 MUTILATED, DESTROYED, LOST OR STOLEN NOTES.
If (i) any mutilated Note is surrendered to the Trustee, or the Trustee
receives evidence to its satisfaction of the destruction, loss or theft of
any Note, and (ii) there is delivered to each of the Issuer and the Trustee
such security or indemnity as may be required by it to hold the Issuer and
the Trustee harmless, then, in the absence of notice to the Issuer, the Note
Registrar or the Trustee that such Note has been acquired by a bona fide
purchaser, and provided that the requirements of Section 8-405 of the UCC are
met, the Issuer shall execute and upon its request the 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 Series (or
Class or Tranche) (such requirement shall not be deemed to create a duty in
the Trustee to monitor the compliance by the Issuer with Section 8-405);
PROVIDED, HOWEVER, that if any such destroyed, lost or stolen Note, but not a
mutilated Note, shall have become or within seven days shall be due and
payable, or shall have been called for redemption pursuant to the terms of
the related Series Supplement, the Issuer may, instead of issuing a
replacement Note, direct the Trustee, in writing, to pay such destroyed, lost
or stolen Note when so due or payable or upon the redemption date without
surrender thereof. If, after the delivery of such replacement Note or
payment of a destroyed, lost or stolen Note pursuant to the proviso to the
preceding sentence, a bona fide purchaser of the original Note in lieu of
which such replacement Note was issued presents for payment such original
Note, the Issuer and the Trustee shall be entitled to recover such
replacement Note (or such payment) from the Person to whom it was delivered
or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or
expense incurred by the Issuer or the Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the
Issuer may require the payment by the Holder of such Note of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Trustee) connected therewith.
Every replacement Note of any Series 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
12
the benefits of this Indenture and the related Series Supplement equally and
proportionately with any and all other Notes of the same Series duly issued
hereunder.
The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Notes.
Section 2.6 PERSONS DEEMED OWNER. Prior to due
presentment for registration of transfer of any Note, the Issuer, the Trustee
and any agent of Issuer or the Trustee may treat the Person in whose name any
Note is registered (as of the Record Date) as the owner of such Note for the
purpose of receiving payments of principal of and interest, if any on such
Note and for all other purposes whatsoever, whether or not such Note be
overdue, and none of the Issuer, the Trustee nor any agent of the Issuer or
the Trustee shall be affected by notice to the contrary.
Section 2.7 PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED
INTEREST
(a) The Notes shall accrue interest as provided in the form
of Note set forth in the related Series Supplement and such interest shall be
due and payable on each Distribution Date as specified therein. Any installment
of interest or principal, if any, payable on any Note which is punctually or
duly provided for by the Issuer on the applicable Distribution Date shall be
paid, as provided in the related Series Supplement, or if not so provided to the
Person in whose name such Note (or one or more Predecessor Notes) is registered
on the 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, except
that, if the Notes of a Series are Book Entry Notes, unless Definitive Notes
have been issued for such Series pursuant to Section 2.12, with respect to Notes
of such Series registered on the Record Date in the name of the nominee of the
Clearing Agency (initially, such nominee to be Cede & Co.), payment will 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 Final Scheduled
Distribution Date with respect to a Series as set forth in the relevant Series
Supplement which shall be payable as provided below. The funds represented by
any such checks returned undelivered shall be held in accordance with Section
3.3.
(b) The principal of each Note shall be payable in
installments on each Distribution Date as provided in the form of Note set forth
in the related Series Supplement. Notwithstanding the foregoing, the entire
unpaid principal amount of the Notes shall be due and payable, if not previously
paid, on the date on which an Event of Default shall have occurred and be
continuing, if the Notes are declared to be immediately due and payable in the
manner provided in the related Series Supplement. Upon written notice from the
Master Servicer on behalf of the Issuer, the Trustee shall notify the Person in
whose name a Note is registered at the close of business on the Record Date
preceding the Distribution Date on which the Issuer expects that the final
installment of principal of and interest on such Note will be paid. Such notice
may be
13
mailed or transmitted by facsimile prior to such final Distribution Date and may
specify that such final installment will be payable only upon presentation and
surrender of such Note and shall specify the place where such Note may be
presented and surrendered for payment of such installment.
(c) If the Issuer defaults in a payment of interest on the
Notes, the Issuer shall pay defaulted interest (plus interest on such defaulted
interest to the extent lawful) at the applicable Note Rate to the extent lawful.
Unless otherwise provided in the related Series Supplements, the Issuer may pay
such defaulted interest to the Persons who are Noteholders on a subsequent
special record date, which date shall be at least five Business Days prior to
the payment date. The Issuer shall fix or cause to be fixed any such special
record date and payment date, and, at least 15 days before any such special
record date, the Issuer shall mail to each Noteholder and the Trustee a notice
that states the special record date, the payment date and the amount of
defaulted interest to be paid.
Section 2.8 CANCELLATION. All Notes surrendered for
payment, registration of transfer, exchange or redemption shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly canceled by the Trustee in accordance with its
customary procedures. The Issuer may at any time deliver to the 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 canceled by the Trustee in accordance with its
customary procedures. No Notes shall be authenticated in lieu of or in
exchange for any Notes canceled as provided in this Section, except as
expressly permitted by this Indenture. All canceled Notes may be held or
disposed of by the Trustee in accordance with its standard retention or
disposal policy as in effect at the time.
Section 2.9 RELEASE OF COLLATERAL. The Trustee shall, on
or after a Series Termination Date, release any remaining portion of the
related Series Trust Estate from the lien created by this Indenture and
deposit in the applicable Series Collection Account any funds then on deposit
in any other Trust Account. The Trustee shall release property from the lien
created by this Indenture pursuant to this Section 2.9 only upon receipt of
an Issuer Request by it and the Trustee 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 11.1.
Section 2.10 BOOK-ENTRY NOTES. The Notes, upon original
issuance, may be issued in the form of typewritten 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. Such Notes may
initially be registered 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 Note Owners pursuant to
Section 2.12:
(i) the provisions of this Section shall be in full force and
effect;
14
(ii) the Note Registrar and the 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 and/or the
Clearing Agency Participants. Unless and until Definitive Notes are
issued pursuant to Section 2.12, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit payments of principal of and interest on the Notes to such
Clearing Agency Participants;
(v) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes
evidencing a specified percentage of the Outstanding Amount of the
Notes, 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 in the Notes of a Class, as the case maybe, and has delivered
such instructions to the Trustee; and
(vi) Note Owners may receive copies of any reports sent to
Noteholders pursuant to this Indenture, upon written request, together
with a certification that they are Note Owners and payment of
reproduction and postage expenses associated with the distribution of
such reports, from the Trustee at the Corporate Trust Office.
Section 2.11 NOTICES TO CLEARING AGENCY. With respect to
each Series of Notes which are Book Entry Notes, whenever a notice or other
communication to the Noteholders of such Series is required under this
Indenture, unless and until Definitive Notes shall have been issued to Note
Owners pursuant to Section 2.12, the Trustee shall give all such notices and
communications specified herein to be given to Holders of the Notes to the
Clearing Agency, and shall have no obligation to the Note Owners.
Section 2.12 DEFINITIVE NOTES. If the Notes of a Series
are Book-Entry Notes and if (i) the Master Servicer advises the Trustee in
writing that the Clearing Agency is no longer willing or able to properly
discharge its responsibilities with respect to the Notes of such Series, and
the Master Servicer is unable to locate a qualified successor, (ii) the
Master Servicer at its option advises the Trustee in writing that it elects
to terminate the book-entry system through the Clearing Agency or (iii) after
the occurrence of an Event of Default with respect to such Series, Note
Owners representing beneficial interests
15
aggregating at least a majority of the Outstanding Amount of the Notes advise
the Trustee 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 the Note Owners, then the Clearing Agency shall notify all Note Owners and
the Trustee of the occurrence of any such event and of the availability of
Definitive Notes to Note Owners requesting the same. Upon surrender to the
Trustee of the typewritten Note or Notes representing the Book-Entry Notes by
the Clearing Agency, accompanied by registration instructions, the Issuer shall
execute and upon the written direction of the Issuer the Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the Trustee shall be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be protected in relying on, such instructions. Upon the issuance
of Definitive Notes, the Trustee shall recognize the Holders of the Definitive
Notes as Noteholders.
Section 2.13 FINAL DISTRIBUTION.
(a) The Master Servicer shall give the Trustee at least 15
days prior notice of the Distribution Date on which the Noteholders of any
Series or Class may surrender their Notes for payment of the final distribution
on and cancellation of such Notes. Not later than the fifth day of the month in
which the final distribution in respect of such Series or Class is payable to
Noteholders, the Trustee shall provide notice to the Noteholders of such Series
or Class specifying (i) the date upon which final payment of such Series or
Class will be made upon presentation and surrender of Notes (if required) of
such Series or Class at the office or offices therein designated, (ii) the
amount of any such final payment and (iii) that the Record Date otherwise
applicable to such payment date is not applicable, payments being made only upon
presentation and surrender of such Notes at the office or offices therein
specified. The Trustee shall give such notice to the Registrar and the Note
Paying Agent at the time such notice is given to Noteholders.
(b) Notwithstanding a final distribution to the Noteholders
of any Series or Class, except as otherwise provided in this paragraph, all
funds then on deposit in the Master Collection Account and any Series Trust
Account allocated to such Noteholders shall continue to be held in trust for the
benefit of such Noteholders, and the Note Paying Agent or the Trustee shall pay
such funds to such Noteholders upon surrender of their Notes. In the event that
all such Noteholders shall not surrender their Notes for cancellation within six
months after the date specified in the notice from the Trustee described in
paragraph (a), the Trustee shall give a second notice to the remaining such
Noteholders to surrender their Notes for cancellation and receive the final
distribution with respect thereto. If within one year after the second notice
all such Notes shall not have been surrendered for cancellation, the Trustee may
take appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining such Noteholders concerning surrender of their Notes, and
the cost thereof shall be paid out of the funds in the account held for the
benefit of such Noteholders. The Trustee and the Note Paying Agent shall upon
written request pay to the related Issuer any moneys held by them for the
payment of principal or interest that remains unclaimed for two years. After
payment to the related Issuers, Noteholders entitled to the money must look to
the related Issuers
16
for payment as general unsecured creditors unless an applicable abandoned
property law designates another Person and all liability of the Trustee or such
Note Paying Agent with respect to such trust money shall thereupon cease.
(c) Any notice required or permitted to be given to a Holder
of Registered Notes shall be given by first-class mail, postage prepaid, at the
address of such Holder as shown in the Note Register.
ARTICLE III.
COVENANTS
Section 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The
Issuer will duly and punctually pay or cause to be paid the principal of and
interest on the Notes in accordance with the terms of the Notes, this
Indenture and the related Series Supplement. Amounts properly withheld under
the Code by any Person from a payment to any Noteholder of interest and/or
principal shall be considered as having been paid by the Issuer to such
Noteholder for all purposes of this Indenture.
Section 3.2 MAINTENANCE OF OFFICE OR AGENCY. The Issuer
will maintain in New York an office or agency where Notes may be surrendered
for registration, transfer or exchange of the Notes, and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may
be served. The Issuer hereby initially appoints the Trustee to serve as its
agent for the foregoing purposes. The Issuer will give prompt written notice
to the Trustee of the location, and of any change in the location, of any
such office or agency. If at any time the Issuer shall fail to maintain any
such office or agency or shall fail to furnish the Trustee with the address
thereof, such surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Issuer hereby appoints the Trustee as its
agent to receive all such surrenders, notices and demands.
Section 3.3 MONEY FOR PAYMENTS TO BE HELD IN TRUST. One
Business Day prior to each Distribution Date, the Issuer shall deposit or
cause to be deposited to the related Series Collection Account Available
Funds (which shall be immediately available) with respect to the related
Collection Period. Such sum shall be held in trust for the benefit of the
Persons entitled thereto and (unless the Note Paying Agent is the Trustee),
the Issuer shall promptly notify the Trustee of its action or failure so to
act.
The Issuer will cause each Note Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in which such Note
Paying Agent shall agree with the Trustee (and if the Trustee acts as Note
Paying Agent with respect to clauses (i) and (v), it hereby so agrees), subject
to the provisions of this Section, that such Note 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
17
shall be paid to such Persons or otherwise disposed of as herein
provided and pay such sums to such Persons as herein provided;
(ii) give the Trustee written notice of any default by the
Issuer of which a Responsible Officer of the Note Paying Agent has
actual knowledge (or any other obligor upon the Notes) in the making of
any payment required to be made with respect to the Notes;
(iii) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Note Paying Agent;
(iv) immediately resign as a Note Paying Agent and forthwith
pay to the Trustee all sums held by it in trust for the payment of Notes
if at any time it ceases to meet the standards required to be met by a
Note Paying Agent at the time of its appointment; and
(v) comply with all requirements of the Code with respect to
the withholding from any payments made by it on any Notes of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture and any Series Supplement or for
any other purpose, by Issuer Order direct any Note Paying Agent to pay to the
Trustee all sums held in trust by such Note Paying Agent, such sums to be held
by the Trustee upon the same trusts as those upon which the sums were held by
such Note Paying Agent; and upon such a payment by any Note Paying Agent to the
Trustee, such Note Paying Agent shall be released from all further liability
with respect to such money.
The Trust hereby appoints The Chase Manhattan Bank as Certificate
Paying Agent to make payments to Certificateholders on behalf of the Issuer in
accordance with the provisions of the Certificates, this Agreement and the Trust
Agreement, and The Chase Manhattan Bank hereby accepts such appointment (subject
to removal in the event it not longer serves as Trustee pursuant to Section 6.8)
and further agrees that it will be bound by the provisions of the Trust
Agreement relating to the Certificate Paying Agent and will:
(vi) hold all sums held by it for the payment of amounts due
with respect to the Certificates 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 as provided in the Trust
Agreement and pay such sums to such Persons as herein and therein
provided;
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(vii) give the Owner Trustee notice of any default by the
Issuer of which a Responsible Officer of the Trustee has actual
knowledge in the making of any payment required to be made with respect
to the Certificates;
(viii) at any time during the continuance of any such default,
upon the written request of the Owner Trustee forthwith pay to the Owner
Trustee on behalf of the Issuer all sums so held in Trust by such
Certificate Paying Agent;
(ix) immediately resign as a Certificate Paying Agent and
forthwith pay to the Owner Trustee on behalf of the Issuer all sums held
by it in trust for the payment of Certificates if at any time it ceases
to meet the standards required to be met by a Note Paying Agent at the
time of its appointment; and
(x) comply with all requirements of the Code with respect to
the withholding from any payments made by it on any Certificates of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith.
Section 3.4 EXISTENCE. Except as otherwise permitted by
the provisions of Section 3.10, the Issuer will keep in full effect its
existence, rights and franchises as a business 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
of America, in which case the Issuer will keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and will
obtain and preserve its qualification to do business in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, each Series Supplement, the Notes and each
other instrument or agreement included in the related Series Trust Estate.
Section 3.5 PROTECTION OF TRUST PROPERTY. The Issuer
intends the security interest Granted pursuant to this Indenture and the
related Series Supplement in favor of the Holders to be prior to all other
liens in respect of the related Series Trust Estate, and the Issuer shall
take all actions necessary to obtain and maintain, in favor of the Trustee
for the benefit of the Holders a first lien on and a first priority,
perfected security interest in the related Series Trust Estate. The Issuer
will from time to time prepare (or shall cause to be prepared), execute and
deliver all such supplements and amendments hereto and all such financing
statements, continuation statements, instruments of further assurance and
other instruments, and will take such other action necessary or advisable to:
(i) Grant more effectively all or any portion of the related
Series Trust Estate;
(ii) maintain or preserve the lien and security interest (and
the priority thereof) in favor of the Trustee for the benefit of the
Holders created by this Indenture and the related Series Supplement or
carry out more effectively the purposes hereof;
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(iii) perfect, publish notice of or protect the validity of any
Grant made or to be made by this Indenture and the related Series
Supplement ;
(iv) enforce any of the related Series Trust Estate;
(v) preserve and defend title to the related Series Trust
Estate and the rights of the Trustee in such Trust Property against the
claims of all persons and parties; and
(vi) pay all taxes or assessments levied or assessed upon the
related Series Trust Estate when due.
The Issuer hereby designates the Master Servicer its agent and attorney-in-fact
to execute any financing statement, continuation statement or other instrument
required by the Trustee pursuant to this Section; PROVIDED that, such
designation shall not be deemed to create a duty in the Trustee to monitor the
compliance of the Master Servicer with respect to its duties under this Section
3.5 or the adequacy of any financing statement, continuation statement or other
instrument prepared by the Master Servicer.
Section 3.6 OPINIONS AS TO TRUST PROPERTY.
(a) On the Closing Date, the Issuer shall furnish to the
Trustee an Opinion of Counsel either stating that, in the opinion of such
counsel, such action has been taken with respect to the recording and filing of
this Indenture, Series Supplement, and any other requisite documents, and with
respect to the execution and filing of any financing statements and continuation
statements, as are necessary to perfect and make effective the first priority
lien and security interest in favor of the Trustee for the benefit of the
Holders, created by this Indenture and the related Series Supplement and
reciting the details of such action, or stating that, in the opinion of such
counsel, no such action is necessary to make such lien and security interest
effective.
(b) Within 90 days after the beginning of each calendar year,
beginning with 2000 the Master Servicer on behalf of the Issuer shall furnish to
the 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 of this Indenture, any Series Supplement and any other
requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as are necessary to maintain
the lien and security interest created by this Indenture and the related Series
Supplement 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 and
security interest. Such Opinion of Counsel shall also describe the recording,
filing, re-recording and refiling of this Indenture, any indentures supplemental
hereto and any other requisite documents and the execution and filing of any
financing statements and continuation statements that will, in the opinion of
such counsel, be required to maintain the lien and security interest of this
Indenture and the related Series Supplement until December 31 of the following
calendar year.
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Section 3.7 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 related Series Trust Estate or that
would result in the amendment, hypothecation, subordination, termination or
discharge of, or impair the validity or effectiveness of, any such instrument or
agreement, except as ordered by any bankruptcy or other court or as expressly
provided in this Indenture, the Basic Documents and the related Series Related
Documents or such other instrument or agreement.
(b) The Issuer may contract with other Persons to assist it
in performing its duties under this Indenture, and any performance of such
duties by a Person identified to the 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 to assist the Issuer in performing its
duties under this Indenture and each Series Supplement. The Master Servicer
hereby agrees to service the Receivables in each Series Trust Estate in the
manner set forth in the Master Sale and Servicing Agreement, this Indenture and
each Series Supplement and to perform its duties as may be set forth in the
Master Sale and Servicing Agreement, this Indenture and in each Series
Supplement.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents, all
Series Related Documents and in the instruments and agreements included in the
related Series Trust Estate, including, but not limited, to preparing (or
causing to be prepared) and filing (or causing to be filed) all UCC financing
statements and continuation statements required to be filed by the terms of this
Indenture, the related Series Supplement and the Master Sale and Servicing
Agreement in accordance with and within the time periods provided for herein and
therein. Except as otherwise expressly provided therein, the Issuer shall not
waive, amend, modify, supplement or terminate any Basic Document or any
provision thereof without the consent of the Trustee.
(d) If a Responsible Officer of the Owner Trustee shall have
actual knowledge of the occurrence of a Master Servicer Termination Event under
the Master Sale and Servicing Agreement, the Issuer shall promptly notify the
Trustee and the Rating Agencies thereof in accordance with Section 11.4, and
shall specify in such notice the action, if any, the Issuer is taking in respect
of such default. If a Master Servicer Termination Event shall arise from the
failure of the Master Servicer to perform any of its duties or obligations under
the Master Sale and Servicing Agreement with respect to the Receivables, the
Issuer shall take all reasonable steps available to it to remedy such failure.
Section 3.8 NEGATIVE COVENANTS. So long as any Notes are
Outstanding, the Issuer shall not:
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(i) except as expressly permitted by this Indenture or the
Basic Documents or the related Series Related Documents, sell, transfer,
exchange or otherwise dispose of any of the properties or assets of the
Issuer, including those included in the related Series Trust Estate;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes of a Series
(other than amounts properly withheld from such payments under the Code)
or assert any claim against any present or former Noteholder by reason
of the payment of the taxes levied or assessed upon any part of the
related Series Trust Estate; or
(iii) (A) permit the validity or effectiveness of this
Indenture or any Series Supplement to be impaired, or permit the lien in
favor of the Trustee 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 or any Series Supplement 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 and the related Series Supplement) to be created on or
extend to or otherwise arise upon or burden the related Series 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 a Financed Vehicle and
arising solely as a result of an action or omission of the related
Obligor), (C) permit the lien of this Indenture and the related Series
Supplement not to constitute a valid first priority (other than with
respect to any such tax, mechanics' or other lien) security interest in
the related Series Trust Estate, (D) except as expressly permitted
therein, amend, modify or fail to comply with the provisions of the
Basic Documents or (E) except as expressly permitted therein, amend,
modify or fail to comply with the provisions of the Series Related
Documents.
Section 3.9 ANNUAL STATEMENT AS TO COMPLIANCE. The
Master Servicer on behalf of the Issuer will deliver to the Trustee, within
90 days after the end of each fiscal year of the Issuer (commencing with the
fiscal year ended December 31, 1999), and otherwise in compliance with the
requirements of TIA Section 314(a)(4) an Officer's Certificate stating, as to
the Authorized Officer signing such Officer's Certificate, that
(i) a review of the activities of the Issuer during such year
and of performance under this Indenture has been made under such
Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, based
on such review, the Issuer has complied with all conditions and
covenants under this Indenture and each Series Supplement throughout
such year, or, if there has been a default in the compliance of any such
condition or covenant, specifying each such default known to such
Authorized Officer and the nature and status thereof.
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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 (if other than the Issuer) formed by or
surviving such consolidation or merger shall be a Person organized and
existing under the laws of the United States of America or any State and
shall expressly assume, by an indenture supplemental hereto, executed
and delivered to the Trustee, in form satisfactory to the 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 Series Supplement on the part of the Issuer to
be performed or observed, all as provided herein;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing under
any Series Supplement;
(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 Trustee and the Owner
Trustee) to the effect that such transaction will not have any material
adverse tax consequence to the Trust, any Noteholder or any
Certificateholder;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture and each Series Supplement
shall have been taken; and
(vi) the Issuer shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel each stating that such
consolidation or merger comply with this Article III and that all
conditions precedent herein provided for relating to such transaction
have been complied with (including any filing required by the Exchange
Act).
(b) The Issuer shall not convey or transfer all or
substantially all of its properties or assets, including those included in each
Series Trust Estate, to any Person, unless
(i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer the conveyance or transfer of which
is hereby restricted shall (A) be a United States citizen or a Person
organized and existing under the laws of the United States of America or
any state, (B) expressly assume, by an indenture supplemental hereto,
executed and delivered to the Trustee, in form satisfactory to the
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, each Supplement, each of the Basic Documents
and each of the Series
23
Related Documents on the part of the Issuer to be performed or observed,
all as provided herein, (C) expressly agree by means of such Indenture
Supplement that all right, title and interest so conveyed or transferred
shall be subject and subordinate to the rights of Holders of the Notes,
(D) unless otherwise provided in such Series Supplement, 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,
each Series Supplement and the Notes and (E) expressly agree by means of
such Series Supplement that such Person (or if a group of persons, then
one specified Person) shall prepare (or cause to be prepared) and 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 under
any Series Supplement;
(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 Trustee) to the effect that
such transaction will not have any material adverse tax consequence to
the Trust, any Noteholder or any Certificateholder;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture and each Series Supplement
shall have been taken; and
(vi) the Issuer shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
conveyance or transfer and such Indenture Supplement complies with this
Article III and that all conditions precedent herein provided for
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 and each Series Supplement with the same effect as if such Person
had been named as each Issuer herein.
(b) Upon a conveyance or transfer of all the assets and
properties of the Issuer pursuant to Section 3.10 (b), Household Automotive
Trust III will be released from every covenant and agreement of this Indenture
and each Series Supplement to be observed or performed on the part of the Issuer
with respect to the Notes immediately
24
upon the delivery of written notice to the Trustee stating that Household
Automotive Trust III is to be so released.
Section 3.12 NO OTHER BUSINESS. The Issuer shall not
engage in any business other than financing, purchasing, owning, selling and
managing the Receivables, entering and maintaining any ancillary agreement
related to issuance of the Notes and owning the Class SV Preferred Stock of
the Seller in the manner contemplated by this Indenture, the Basic Documents
and each Series Supplement and all Series Related 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, (ii) obligations owing from
time to time to a related Series Support Provider under the related agreement
regarding Series Support, if any and (iii) any other Indebtedness permitted
by or arising under the Basic Documents and each Series Supplement. The
proceeds of the Notes and the Certificates of a Series shall be used
exclusively to fund the Issuer's purchase of the Receivables of such Series,
or to obtain release of the lien relating to the pledge of the Receivables
for a prior series of notes issued by the Issuer, the purchase of related
property of the Series Trust Estate, to fund any trust account and to pay the
Issuer's organizational, transactional and start-up expenses.
Section 3.14 MASTER SERVICER'S OBLIGATIONS. The Issuer
shall enforce the provisions of Sections 4.9, 4.10 and 4.11 of the Master
Sale and Servicing Agreement with respect to the duties of Master Servicer
thereunder.
Section 3.15 GUARANTEES, LOANS, ADVANCES AND OTHER
LIABILITIES. Except as contemplated by the Master Sale and Servicing
Agreement or this Indenture or any Series Supplement, 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 continently liable, directly or indirectly, in
connection with the obligations, stocks or dividends of, or own, purchase,
repurchase or acquire (or agree continently 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 personally).
Section 3.17 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, any Series Supplement or any Series
Related Document.
Section 3.18 RESTRICTED PAYMENTS. The Issuer shall not,
directly or indirectly, (i) pay any dividend or make any distribution (by
reduction of capital or otherwise), whether
25
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
Seller, (ii) redeem, purchase, retire or otherwise acquire for value any such
ownership or equity interest or security or (iii) set aside or otherwise
segregate any amounts for any such purpose; PROVIDED, HOWEVER, that the Issuer
may make, or cause to be made, distributions to the Seller, Master Servicer, the
Owner Trustee, the Trustee and the Certificateholders as permitted by, and to
the extent funds are available for such purpose under, the Master Sale and
Servicing Agreement or Trust Agreement. The Issuer will not, directly or
indirectly, make payments to or distributions from the Master Collection Account
except in accordance with this Indenture, the Basic Documents, any Series
Supplement or any Series Related Document.
Section 3.19 NOTICE OF EVENTS OF DEFAULT. Upon a
Responsible Officer of the Owner Trustee having actual knowledge thereof, the
Issuer agrees to give the Trustee and the Rating Agencies prompt written
notice of each Event of Default under any Series Supplement and each default
on the part of the Master Servicer or the Seller of its obligations under the
Master Sale and Servicing Agreement.
Section 3.20 FURTHER INSTRUMENTS AND ACTS. Upon request
of the 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 AMENDMENTS OF MASTER SALE AND SERVICING
AGREEMENT AND TRUST AGREEMENT. The Issuer shall not agree to any amendment
to Section 13.1 of the Master Sale and Servicing Agreement or Section 13.1 of
the Trust Agreement to eliminate the requirements thereunder that the Trustee
or the Holders of the Notes consent to amendments thereto as provided therein.
Section 3.22 INCOME TAX CHARACTERIZATION. For purposes of
federal income, state and local income and franchise and any other income
taxes, the Issuer, the Noteholders, the Certificateholders and the Trustee
will treat the Notes as indebtedness and hereby instructs the Trustee to
treat the Notes as indebtedness for federal and state tax reporting purposes.
ARTICLE IV.
SATISFACTION AND DISCHARGE
Section 4.1 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 3.3, 3.4, 3.5, 3.8, 3.10, 3.12, 3.13, 3.20, 3.21 and 3.22, (v)
the rights and immunities of the Trustee hereunder (including the rights of
the Trustee under Section 6.7 and the obligations of the Trustee under
Section 4.2) and (vi) the rights of Noteholders as
26
beneficiaries hereof with respect to the related Series Trust Estate so
deposited with the Trustee payable to all or any of them, and the Trustee, on
demand of and at the expense of the Issuer, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to the
Notes, when
(A) either
(1) all Notes theretofore authenticated and delivered
(other than (i) Notes that have been destroyed, lost or stolen
and that have been replaced or paid as provided in Section 2.5
and (ii) Notes 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 3.3) have been delivered to the
Trustee for cancellation and the related Series Support, if any,
has been returned to the related Series Support Provider; or
(2) all Notes not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable,
(ii) will become due and payable at their
respective Final Scheduled Distribution Dates within one
year, or
(iii) are to be called for redemption within one
year under arrangements satisfactory to the Trustee for
the giving of notice of redemption by the Trustee in the
name, and at the expense, of the Issuer,
and the Issuer, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be irrevocably deposited with
the Trustee cash or direct obligations of or obligations
guaranteed by the United States of America (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
Trustee for cancellation when due on the Final Scheduled
Distribution Date or tender date (if Notes shall have been called
for redemption or tender pursuant to the related Series
Supplement, as the case may be; and
(B) the Issuer has paid or caused to be paid all other
amounts owing to all Holders.
Section 4.2 APPLICATION OF TRUST MONEY. All monies
deposited with the Trustee pursuant to Section 4.1 hereof shall be held in
trust and applied by it, in accordance with the provisions of the Notes, this
Indenture and the related Series Supplement, to the payment, either directly
or through any Note Paying Agent, as the Trustee may determine, to the
Holders of the particular Notes for the payment or redemption of which such
27
monies have been deposited with the 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 Master Sale and
Servicing Agreement or required by law.
Section 4.3 REPAYMENT OF MONIES HELD BY NOTE PAYING
AGENT. In connection with the satisfaction and discharge of this Indenture
with respect to the Notes, all monies then held by any Note Paying Agent
other than the Trustee under the provisions of this Indenture with respect to
such Notes shall, upon demand of the Issuer, be paid to the Trustee to be
held and applied according to Section 3.3 and thereupon such Note Paying
Agent shall be released from all further liability with respect to such
monies.
ARTICLE V.
REMEDIES
Section 5.1 EVENTS OF DEFAULT. The definition of "Event
of Default" with respect to a Series, together with certain rights and
remedies consequent thereto, shall be set forth in the related Series
Supplement.
Section 5.2 COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY TRUSTEE.
(a) Subject to the terms of the related Series Supplement,
the Issuer covenants that if (i) default is made in the payment of any interest
on any Note when the same becomes due and payable, and such default continues
for a period of five days, or (ii) default is made in the payment of the
principal of or any installment of the principal of any Note when the same
becomes due and payable, and such default continues for a period of five days,
the Issuer will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of the Notes, the whole amount then due and payable on such Notes for
principal and interest, with interest upon the overdue principal, and, to the
extent payment at such rate of interest shall be legally enforceable, upon
overdue installments of interest, at the applicable Note 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 Trustee and its agents and outside counsel.
(b) If an Event of Default occurs and is continuing with
respect to a Series, the Trustee may in its discretion proceed to protect and
enforce the rights of the Noteholders of each Series by such appropriate
Proceedings as the Trustee shall deem most effective to protect and enforce any
such rights, whether for the specific enforcement of any covenant or agreement
in this Indenture or the related Series Supplement or in aid of the exercise of
any power granted herein, or to enforce any other proper remedy or legal or
equitable right vested in the Trustee by this Indenture, the related Series
Supplement or by law.
28
(c) In case there shall be pending, relative to the Issuer or
any other obligor upon the Notes or any Person having or claiming an ownership
interest in the related Series Trust Estate, proceedings under Title 11 of the
United States Code or any other applicable Federal or state bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, sequestrator or similar official shall
have been appointed for or taken possession of the Issuer or its property or
such other obligor or Person, or in case of any other comparable judicial
proceedings relative to the Issuer or other obligor upon the Notes of such
Series, or to the creditors or property of the Issuer or such other obligor, the
Trustee, irrespective of whether the principal of any Notes of such Series shall
then be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand pursuant to the
provisions of this Section, shall be entitled and empowered, by intervention in
such proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount
of principal and interest owing and unpaid in respect of such Notes and
to file such other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee against the related Series
Trust Estate (including any claim for reasonable compensation to the
Trustee and each predecessor Trustee, and their respective agents,
attorneys and outside counsel, and for reimbursement of all expenses and
liabilities incurred, and all advances made, by the Trustee and each
predecessor Trustee, except as a result of negligence, bad faith or
willful misconduct) and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to
vote on behalf of the Holders of Notes of such Series 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 received with respect to
the related Series Trust Estate and to distribute all amounts received
with respect to the claims of the Noteholders and of the Trustee on
their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Trustee or the Holders of Notes of such Series, in each case
against the related Series Trust Estate allowed in any judicial
proceedings relative to the Issuer, its creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such proceeding is hereby authorized by each of such Noteholders to make
payments to the Trustee, and, in the event that the Trustee shall consent to the
making of payments directly to such Noteholders, to pay to the Trustee such
amounts as shall be sufficient to cover reasonable compensation to the Trustee,
each predecessor Trustee and their respective agents, attorneys and counsel, and
all other expenses and liabilities incurred, and all advances made, by the
Trustee and each predecessor Trustee except as a result of negligence or bad
faith.
29
(d) Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the 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.
(e) All rights of action and of asserting claims under this
Indenture, the related Series Supplement or under any of the Notes, may be
enforced by the 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 Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment, subject to
the payment of the expenses, disbursements and compensation of the Trustee, each
predecessor Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Holders of the Notes.
(f) In any proceedings brought by the Trustee (and also any
proceedings involving the interpretation of any provision of this Indenture or
the related Series Supplement), the Trustee shall be held to represent all the
Holders of the Notes, and it shall not be necessary to make any Noteholder a
party to any such proceedings.
Section 5.3 LIMITATION OF SUITS. No Holder of any Note
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture or the related Series Supplement, or for the
appointment of a receiver or trustee, or for any other remedy hereunder,
unless:
(i) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the Notes of
the related Series;
(ii) the Holders of not less than 25% of the Outstanding
Amount of the Notes of the related Series have made written request to
the Trustee to institute such proceeding in respect of such Event of
Default in its own name as Trustee hereunder;
(iii) such Holder or Holders have offered to the Trustee
indemnity reasonably satisfactory to it against the costs, expenses and
liabilities to be incurred in complying with such request;
(iv) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute such Proceedings;
and
(v) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority of the Outstanding Amount of the Notes of such Series.
it being understood and intended that no Holders of Notes shall have any right
in any manner whatsoever by virtue of, or by availing of, any provision of this
Indenture to
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affect, disturb or prejudice the rights of any other Holders of Notes or to
obtain or to seek to obtain priority or preference over any other Holders or to
enforce any right under this Indenture, except in the manner herein provided.
Section 5.4 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO
RECEIVE PRINCIPAL AND INTEREST. Notwithstanding any other provisions in 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 or after the respective due dates thereof expressed in such
Note or in this Indenture or the related Series Supplement (or, in the case
of redemption or tender pursuant to any Series Supplement, on or after the
related redemption or tender 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 5.5 RESTORATION OF RIGHTS AND REMEDIES. If the
Trustee or any Noteholder has instituted any Proceeding to enforce any right
or remedy under this Indenture or the related Series Supplement and such
Proceeding has been discontinued or abandoned for any reason, then and in
every such case the Issuer, the Trustee, and the related 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 Trustee, and the related Noteholders shall continue as
though no such proceeding had been instituted.
Section 5.6 RIGHTS AND REMEDIES CUMULATIVE. No right or
remedy herein conferred upon or reserved to the related 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 5.7 DELAY OR OMISSION NOT A WAIVER. No delay or
omission of the Trustee or any Holder of any related Note 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 an acquiescence therein. Every right and remedy given by this
Article V or by law to the Trustee, the Trustee or to the related Noteholders
may be exercised from time to time, and as often as may be deemed expedient,
by the Trustee or by the related Noteholders, as the case may be.
Section 5.8 CONTROL BY NOTEHOLDERS. The Holders of a
majority of the Outstanding Amount of the Notes with respect to such Series
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee with respect to the Notes
of such Series or exercising any trust or power conferred on the Trustee;
PROVIDED that
(i) such direction shall not be in conflict with any rule of
law or with this Indenture or with the related Series Supplement; and
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(ii) the Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction;
PROVIDED, HOWEVER, that, subject to Section 6.1, the Trustee need not take any
action that it determines might involve it in liability or might materially
adversely affect the rights of any Noteholders not consenting to such action.
Section 5.9 WAIVER OF PAST DEFAULTS. Unless otherwise
provided in the related Series Related Documents, a majority of the
Noteholders of a Series may waive any past Default or Event of Default
relating to such Series and its consequences except a Default relating to
such Series (a) in payment of principal of or interest on any of the Notes of
the related Series or (b) in respect of a covenant or provision hereof which
cannot be modified or amended without the consent of the Holder of each Note
of the related Series. In the case of any such waiver, the Issuer, the
Trustee and the Holders of the Notes of the related Series shall be restored
to their former positions and rights hereunder, respectively; but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereto.
Upon any such waiver, such 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 and the related Series Supplement; but no
such waiver shall extend to any subsequent or other Default or Event of Default
or impair any right consequent thereto.
Section 5.10 UNDERTAKING FOR COSTS. All parties to this
Indenture and the related Series Supplement agree, and each Holder of any
Note by such ▇▇▇▇▇▇'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 and the related Series Supplement,
or in any suit against the Trustee for any action taken, suffered or omitted
by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (a) any suit instituted by the
Trustee, (b) any suit instituted by any Noteholder, or group of Noteholders,
in each case holding in the aggregate more than 10% of the Outstanding Amount
of the Notes of the related Series or (c) any suit instituted by 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 and the related Series Supplement.
Section 5.11 WAIVER OF STAY OR EXTENSION LAWS. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead or in any manner whatsoever, claim or take the
benefit 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 related Series Supplement; and the Issuer (to the extent
that it may lawfully do so) hereby expressly waives all benefit of any such
law, and
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covenants that it will not hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.
Section 5.12 ACTION ON NOTES. The Trustee's right to seek
and recover judgment on the Notes or under this Indenture or any Series
Supplement shall not be affected by the seeking, obtaining or application of
any other relief under or with respect to this Indenture or the related
Series Supplement. Neither the lien of this Indenture or the related Series
Supplement nor any rights or remedies of the Trustee or the Noteholders shall
be impaired by the recovery of any judgment by the Trustee against the Issuer
or by the levy of any execution under such judgment upon any portion of the
related Series Trust Estate or upon any of the assets of the Issuer.
Section 5.13 PERFORMANCE AND ENFORCEMENT OF CERTAIN
OBLIGATIONS.
(a) Promptly following a request from the Trustee to do so
and at the Master Servicer's expense, the Issuer agrees to take all such lawful
action as the Trustee may request to compel or secure the performance and
observance by the Seller and the Master Servicer, as applicable, of each of
their obligations to the Issuer under or in connection with the Master Sale and
Servicing Agreement in accordance with the terms thereof, and to exercise any
and all rights, remedies, powers and privileges lawfully available to the Issuer
under or in connection with the Master Sale and Servicing Agreement to the
extent and in the manner directed by the Trustee, including the transmission of
notices of default on the part of the Seller or the Master Servicer thereunder
and the institution of legal or administrative actions or proceedings to compel
or secure performance by the Seller or the Master Servicer of each of their
obligations under the Master Sale and Servicing Agreement.
(b) If an Event of Default has occurred and is continuing
with respect to a Series, the Trustee may, and, at the written direction of the
Holders of 66-2/3% of the Outstanding Amount of the Notes of such Series shall,
exercise all rights, remedies, powers, privileges and claims of the Issuer
against the Seller or the Master Servicer under or in connection with the Master
Sale and Servicing Agreement, including the right or power to take any action to
compel or secure performance or observance by the Seller or the Master Servicer
of each of their obligations to the Issuer thereunder and to give any consent,
request, notice, direction, approval, extension or waiver under the Master Sale
and Servicing Agreement, and any right of the Issuer to take such action shall
be suspended.
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ARTICLE VI.
THE TRUSTEE
Section 6.1 DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing of
which Responsible Officer of the Trustee has actual knowledge, the Trustee shall
exercise the rights and powers vested in it by this Indenture and the Basic
Documents and use the same degree of care and skill in its exercise as a prudent
person would exercise or use under the circumstances in the conduct of such
person's own affairs.
(b) Except during the continuance of an Event of Default with
respect to a Series of which a Responsible Officer of the Trustee has actual
knowledge:
(i) the Trustee undertakes to perform with respect to such
Series such duties and only such duties as are specifically set forth in
this Indenture and the related Series Supplement and no implied
covenants or obligations shall be read into this Indenture or the
related Series Supplement against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee as the case may be and conforming to the
requirements of this Indenture and the related Series Supplement;
however, the Trustee shall examine the certificates and opinions to
determine whether or not they conform on their face to the requirements
of this Indenture or the related Series Supplement provided, further,
that the Trustee shall not be responsible for the accuracy or content of
any resolution, certificate, statement, opinion, report, document, order
or other instrument furnished to it, including, without limitation, any
statistical, numerical or financial data contained therein.
(c) The Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b)
of this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the 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 5.8.
34
(d) The Trustee shall not be liable for interest on any money
received by it except as such Person may agree in writing with the Issuer.
(e) Money held in trust by the Trustee need not be segregated
from other funds except to the extent required by law or the terms of this
Indenture, the related Series Supplement or the Master Sale and Servicing
Agreement.
(f) No provision of this Indenture or the related Series
Supplement shall require the Trustee to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers, if it shall have
reasonable grounds to believe that repayment of such funds or indemnity
reasonably satisfactory to it against such risk or liability is not reasonably
assured to it.
(g) Every provision of this Indenture and the related Series
Supplement relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section and
to the provisions of the TIA.
(h) The Trustee shall, and ▇▇▇▇▇▇ agrees that it will,
perform all of the obligations and duties required of it under the Master Sale
and Servicing Agreement.
(i) Without limiting the generality of this Section 6.1, the
Trustee shall have no duty (i) to see to any recording, filing or depositing of
this Indenture, any Series Supplement or any agreement referred to herein or any
financing statement evidencing a security interest in the Financed Vehicles, or
to see to the maintenance of any such recording or filing or depositing or to
any recording, refiling or redepositing of any thereof, (ii) to see to any
insurance of the Financed Vehicles or Obligors or to effect or maintain any such
insurance, (iii) to see to the payment or discharge of any tax, assessment or
other governmental charge or any Lien or encumbrance of any kind owing with
respect to, assessed or levied against any part of the Trust, (iv) to confirm or
verify the contents of any reports or certificates delivered to the Trustee
pursuant to this Indenture, any Series Supplement or the Master Sale and
Servicing Agreement believed by the Trustee to be genuine and to have been
signed or presented by the proper party or parties, or (v) to inspect the
Financed Vehicles at any time or ascertain or inquire as to the performance of
observance of any of the Issuer's, the Seller's or the Master Servicer's
representations, warranties or covenants or the Master Servicer's duties and
obligations as Master Servicer and as custodian of the Receivable Files under
the Master Sale and Servicing Agreement.
(j) In no event shall The Chase Manhattan Bank, in any of its
capacities hereunder, be deemed to have assumed any duties of the Owner Trustee
under the Delaware Business Trust Statute, common law, or the Trust Agreement.
35
Section 6.2 RIGHTS OF TRUSTEE.
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Trustee shall
not be liable for any action it takes or omits to take in good faith in reliance
on the Officer's Certificate or Opinion of Counsel.
(c) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Trustee shall not be
responsible for any misconduct or negligence on the part of, or for the
supervision of the Master Servicer or any other agent, attorney, custodian or
nominee appointed with due care by it hereunder.
(d) The Trustee shall not be liable for any action it takes
or omits to take in good faith which it believes to be authorized or within its
rights or powers; PROVIDED, HOWEVER, that the Trustee's conduct does not
constitute willful misconduct, negligence or bad faith.
(e) The Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture, the
Basic Documents, any Series Supplement, any Series Related Documents and the
Notes and such advice or opinion of counsel shall be full and complete
authorization and protection from liability in respect to any action taken,
omitted or suffered by it hereunder in good faith and in accordance with the
advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to institute,
conduct or defend any litigation under this Indenture or any Series Supplement
or in relation to this Indenture or any Series Supplement, at the request, order
or direction of any of the Holders of Notes, pursuant to the provisions of this
Indenture or any Series Supplement, unless such Holders of Notes shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities that may be incurred therein or thereby; PROVIDED,
HOWEVER, that the Trustee shall, upon the occurrence of an Event of Default
(that has not been cured), exercise the rights and powers vested in it by this
Indenture and any Series Supplement with reasonable care and skill customary for
the care and skill exercised by trustees under similar circumstances.
(g) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond or
other paper or document, PROVIDED, HOWEVER, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation is, in the opinion of the
Trustee not reasonably assured to the Trustee by the security afforded
36
to it by the terms of this Indenture, any Series Supplement or the Master Sale
and Servicing Agreement, the Trustee may require indemnity reasonably
satisfactory to it against such cost, expense or liability as a condition to so
proceeding; the reasonable expense of every such examination shall be paid by
the Person making such request, or, if paid by the Trustee shall be reimbursed
by the Person making such request upon demand.
(h) The right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the Trustee
shall not be answerable for other than its negligence or willful misconduct in
the performance of such act.
(i) The Trustee shall not be required to give any bond or
surety in respect of the execution of the Trust Estate created hereby or the
powers granted hereunder.
(j) Anything in this Indenture or any Supplement hereto to
the contrary notwithstanding, in no event shall the Trustee be liable for
special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Trustee has been
advised of the likelihood of such loss or damage and regardless of the form of
action.
(k) The Trustee shall not be required to take notice or be
deemed to have notice or knowledge of any default, Event of Default, Master
Servicer Termination Event unless a Responsible Officer of the Trustee shall
have actual notice thereof.
(l) The Trustee shall not in any way be held liable by reason
of any insufficiency in any Trust Account (including, without limitation, the
Master Collection Account, the Series 1999-1 Reserve Account and the Series
1999-1 Collection Account or any subaccount thereof) held by or on behalf of the
Trustee resulting from any investment loss on any Eligible Investment included
therein.
Section 6.3 INDIVIDUAL RIGHTS OF TRUSTEE. The 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 Trustee. Any Note Paying Agent, Note Registrar,
co-registrar or co-paying agent may do the same with like rights. However,
the Trustee must comply with Sections 6.11 and 6.12.
Section 6.4 TRUSTEE'S DISCLAIMER. The Trustee shall not
be responsible for and makes no representation as to the validity or adequacy
of this Indenture, any Series Supplement, the related Series Trust Estate or
the Notes, it shall not be accountable for the Issuer's use of the proceeds
from the Notes, and it shall not be responsible for any statement of the
Issuer in the Indenture, in any Series Supplement or in any document issued
in connection with the sale of the Notes or in the Notes other than the
Trustee's certificate of authentication.
Section 6.5 NOTICE OF DEFAULTS. If an Event of Default
occurs and is continuing and if it is either actually known by, or written
notice of the existence thereof has been
37
delivered to, a Responsible Officer of the Trustee, the Trustee shall mail to
each Noteholder notice of the Default within 90 days after such knowledge or
notice occurs. Except in the case of a Default in payment of principal of or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of Noteholders.
Section 6.6 REPORTS BY TRUSTEE TO HOLDERS. Upon written
request, the Note Paying Agent or the Master Servicer shall on behalf of the
Issuer deliver to each Noteholder such information as may be reasonably
required to enable such Holder to prepare its Federal and state income tax
returns required by law.
Section 6.7 COMPENSATION AND INDEMNITY.
(a) As payable in each Series Supplement, the Issuer shall,
or shall cause the Master Servicer to, pay to the Trustee from time to time the
Trustee Fee as compensation for its services. The Trustee's compensation shall
not be limited by any law on compensation of a trustee of an express trust. The
Issuer shall or shall cause the Master Servicer to reimburse the Trustee for all
reasonable out-of-pocket expenses incurred or made by it, including costs of
collection, in addition to the compensation for its services. Such expenses
shall include the reasonable compensation and expenses, disbursements and
advances of the Trustee's agents, outside counsel, accountants and experts. The
Issuer shall or shall cause the Master Servicer to indemnify the Trustee, and
its respective officers, directors, employees and agents against any and all
loss, liability or expense (including attorneys' fees and expenses) incurred by
each of them in connection with the acceptance or the administration of this
trust and the performance of its duties hereunder. The Trustee shall notify the
Issuer and the Master Servicer promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Issuer and the Master
Servicer shall not relieve the Issuer of its obligations hereunder or the Master
Servicer of its obligations under Article XII of the Master Sale and Servicing
Agreement. The Issuer shall defend or shall cause the Master Servicer to defend
any claim for indemnity that may arise against the Trustee, or the Trustee may
have separate counsel and the Issuer shall or shall cause the Master Servicer to
pay the fees and expenses of such counsel. Neither the Issuer nor the Master
Servicer need reimburse any expense or indemnify against any loss, liability or
expense incurred by the Trustee through such Person's own willful misconduct,
negligence or bad faith.
(b) The Issuer's payment obligations to the Trustee pursuant
to this Section shall survive the resignation or removal of the Trustee and the
discharge of this Indenture. When the Trustee incurs expenses after the
occurrence of an Insolvency Event with respect to the Issuer, the expenses are
intended to constitute expenses of administration under Title 11 of the United
States Code or any other applicable Federal or state bankruptcy, insolvency or
similar law. Notwithstanding anything else set forth in this Indenture, the
Basic Documents, any Series Supplement or any Series Related Documents, the
Trustee agrees that the obligations of the Issuer (but not the Master Servicer)
to the Trustee hereunder and under any Series Supplement or any Series Related
Documents, shall be recourse to the related Series Trust Estate only and
specifically shall
38
not be recourse to the assets of the Issuer or any Securityholder. In addition,
the Trustee agrees that its recourse to the Issuer, the related Series Trust
Estate, the Seller and amounts held pursuant to the related Series Support shall
be limited to the right to receive the distributions as provided for in the
payment priority provisions of the related Series Supplement.
Section 6.8 REPLACEMENT OF TRUSTEE. The Trustee may, and
in the circumstances specified in subparagraph (i) shall, resign at any time
upon 60 days' prior written notice by so notifying the Issuer. Holders of a
majority of Outstanding Amount of the Notes and the Master Servicer. In
addition, the Master Servicer may remove the Trustee by so notifying the
Trustee upon 60 days' written notice. The Issuer may and, at the request of
the Noteholders shall, remove the Trustee, if:
(i) the Trustee fails to comply with Section 6.11;
(ii) a court having jurisdiction in the premises in respect of
the Trustee in an involuntary case or proceeding under Federal or state
banking or bankruptcy laws, as now or hereafter constituted, or any
other applicable Federal or state bankruptcy, insolvency or other
similar law, shall have entered a decree or order granting relief or
appointing a receiver, liquidator, assignee, custodian, trustee,
conservator, sequestrator (or similar official) for the Trustee or for
any substantial part of the Trustee's property, or ordering the
winding-up or liquidation of the Trustee's affairs;
(iii) an involuntary case under the Federal bankruptcy laws, as
now or hereafter in effect, or another present or future Federal or
state bankruptcy, insolvency or similar law is commenced with respect to
the Trustee and such case is not dismissed within 60 days;
(iv) the Trustee commences a voluntary case under any federal
or state banking or bankruptcy laws, as now or hereafter constituted, or
any other applicable federal or state bankruptcy, insolvency or other
similar law, or consents to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, conservator,
sequestrator (or other similar official) for the Trustee or for any
substantial part of the Trustee's property, or makes any assignment for
the benefit of creditors or fails generally to pay its debts as such
debts become due or takes any corporate action in furtherance of any of
the foregoing;
(v) the Trustee otherwise becomes incapable of acting; or
(vi) the rating assigned to the long-term unsecured debt
obligations of the Trustee by the Rating Agencies shall be lowered below
the rating of "BBB", "Baa2" or equivalent rating or be withdrawn by
either of the Rating Agencies.
39
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Issuer shall promptly deliver a notice
of such removal, resignation or vacancy to the Master Servicer and the Master
Servicer may appoint a successor Trustee. If the Master Servicer fails to
appoint such a successor Trustee, the Issuer or a resigning Trustee may petition
any court of competent jurisdiction to appoint a successor Trustee. If the
Trustee resigns or is removed, the Trustee shall also resign or be removed, as
the case may be, as Certificate Paying Agent.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the retiring
Trustee under this Indenture and the Series Supplement. The successor Trustee
shall mail a notice of its succession to Noteholders. The retiring Trustee
shall promptly transfer all property held by it as Trustee to the successor
Trustee.
If the Trustee fails to comply with Section 6.11, any Noteholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this Section, the
Issuer's and the Master Servicer's obligations under Section 6.7 shall continue
for the benefit of the retiring Trustee.
Section 6.9 SUCCESSOR TRUSTEE BY MERGER. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee entity without any
further act shall be the successor Trustee; PROVIDED that such corporation or
banking association shall otherwise be eligible under Section 6.11 hereof.
The Trustee shall provide the Rating Agencies with written notice of any such
transaction as soon as practical thereafter.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor hereunder or in the name of the successor to the
Trustee; and in all such cases such certificates shall have the full force which
it is anywhere in the Notes or in this Indenture provided that the certificate
of the Trustee shall have.
Section 6.10 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
(a) Notwithstanding any other provisions of this Indenture,
at any time, for the purpose of meeting any legal requirement of any
jurisdiction in which any part of
40
the Trust may at the time be located, the Trustee shall have the power and may
execute and deliver all instruments to appoint one or more Persons to act as a
co-trustee or co-trustees, or separate trustee or separate trustees, of all or
any part of the related Series Trust Estate, and to vest in such Person or
Persons, in such capacity and for the benefit of the Noteholders, such title to
the related Series Trust Estate, or any part hereof, and, subject to the other
provisions of this Section, such powers, duties, obligations, rights and trusts
as the Trustee may consider necessary or desirable. No co-trustee or separate
trustee hereunder shall be required to meet the terms of eligibility as a
successor trustee under Section 6.11 and no notice to Noteholders of the
appointment of any co-trustee or separate trustee shall be required under
Section 6.8 hereof.
(b) Every separate trustee and co-trustee shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed the
Trustee shall be incompetent or unqualified to perform such act or acts,
in which event such rights, powers, duties and obligations (including
the holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(ii) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder, including acts or
omissions of predecessor or successor trustees; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Indenture, specifically including every provision of this Indenture
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may at any time
constitute the Trustee, its agent or attorney-in-fact with full power and
authority, to the extent not
41
prohibited by law, to do any lawful act under or in respect of this Agreement on
its behalf and in its name. If any separate trustee or co-trustee shall die,
dissolve, become insolvent, become incapable of acting, resign or be removed,
all of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 6.11 ELIGIBILITY: DISQUALIFICATION. The Trustee
shall at all times: satisfy TIA Section 310(a), 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 have a long-term debt rating of at least
"BBB", "Baa2" or equivalent rating from each of the Rating Agencies. The
Trustee shall comply with TIA Section 310(b), including the optional
provision permitted by the second sentence of TIA Section 310(b)(9);
PROVIDED, HOWEVER, that there shall be excluded from the operation of TIA
Section 310(b)(1) any indenture or indentures under which other securities
of the Issuer are outstanding if the requirements for such exclusion set
forth in TIA Section 310(b)(1) are met.
Section 6.12 PREFERENTIAL COLLECTION OF CLAIMS AGAINST
ISSUER. The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A 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 THE
TRUSTEE. The Trustee represents and warrants to the Issuer as follows:
(a) DUE ORGANIZATION. The Trustee is a New York banking
corporation, duly organized, validly existing and in good standing under the
laws of the State of New York and is duly authorized and licensed under
applicable law to conduct its business as presently conducted.
(b) CORPORATE POWER. The Trustee has all requisite right,
power and authority to execute and deliver this Indenture and each Series
Supplement and to perform all of its duties as the Trustee hereunder.
(c) DUE AUTHORIZATION. The execution and delivery by the
Trustee of this Indenture, each Series Supplement and the other Series Related
Transaction Documents to which it is a party, and the performance by the Trustee
of its duties hereunder and thereunder, have been duly authorized by all
necessary corporate proceedings which are required for the valid execution and
delivery by the Trustee, or the performance by the Trustee, of this Indenture,
each Series Supplement and such other Series Related Documents.
(d) VALID AND BINDING INDENTURE. The Trustee has duly
executed and delivered this Indenture, each Series Supplement, each other Basic
Document and each Series Related Document to which it is a party, and each of
this Indenture, any Series Supplement, each other Basic Document and each other
Series Related Document constitutes the legal, valid and binding obligation of
the Trustee enforceable against the
42
Trustee in accordance with its terms, except as (i) such enforceability may be
limited by bankruptcy, insolvency, reorganization and similar laws relating to
or affecting the enforcement of creditors' rights generally and (ii) the
availability of equitable remedies may be limited by equitable principles of
general applicability.
Section 6.14 WAIVER OF SETOFFS. The Trustee hereby
expressly waives any and all rights of setoff that the Trustee may otherwise
at any time have under applicable law with respect to any Trust Account and
Series Trust Account and agrees that amounts in the Trust Accounts and Series
Trust Accounts shall at all times be held and applied solely in accordance
with the provisions hereof.
Section 6.15 NO CONSENT TO CERTAIN ACTS OF SELLER. The
Seller shall not request that the Trustee consent to, nor shall the Trustee
consent to any action proposed to be taken by the Seller pursuant to Article
FIFTEENTH of the Seller's Articles of Incorporation.
ARTICLE VII.
NOTEHOLDERS' LISTS AND REPORTS
Section 7.1 ISSUER TO FURNISH TO TRUSTEE NAMES AND
ADDRESSES OF NOTEHOLDERS. The Issuer will furnish or cause to be furnished
to the Trustee with respect to each Series of Notes (a) not more than five
days after the earlier of (i) each Record Date with respect to such Series
and (ii) three months after the last Record Date, a list, in such form as the
Trustee may reasonably require, of the names and addresses of the Holders
with respect to such Series as of such Record Date, (b) at such other times
as the 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 10 days prior to the time such list is furnished; PROVIDED,
HOWEVER, that so long as the Trustee is the Note Registrar, no such list
shall be required to be furnished.
Section 7.2 PRESERVATION OF INFORMATION; COMMUNICATIONS
TO NOTEHOLDERS. The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders contained in
the most recent list furnished to the Trustee as provided in Section 7.1 and
the names and addresses of Holders received by the Trustee in its capacity as
Note Registrar. The Trustee may destroy any list furnished to it as provided
in such Section 7.1 upon receipt of a new list so furnished.
(a) Noteholders may communicate pursuant to TIA Section
312(b) with other Noteholders with respect to their rights under this Indenture
or under the Notes.
(b) The Issuer, the Trustee and the Note Registrar shall have
the protection of TIA Section 312(c).
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Section 7.3 REPORTS BY ISSUER.
If this Indenture is qualified under the TIA, the Issuer shall:
(i) file with the Trustee, within 15 days after the Issuer is
required to file the same with the Commission, copies of the annual
reports and copies of 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) which 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 Trustee and 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 conditions and covenants of
this Indenture as may be required from time to time by such rules and
regulations; and
(iii) supply to the Trustee (and the Trustee shall transmit by
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 7.3(a) as may be
required by 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.
(c) The Trustee shall not have any duty or obligation with
respect to any reports or other information delivered to it pursuant to this
Section 7.3.
Section 7.4 REPORTS BY TRUSTEE. If required by TIA
Section 313(a), within 60 days after each March 31 beginning with March 31,
2000 the 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 Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Noteholders
shall be filed by the Trustee with the Commission and each stock exchange, if
any, on which the Notes are listed. The Issuer shall notify the Trustee if and
when the Notes are listed on any stock exchange.
ARTICLE VIII.
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.1 COLLECTION OF MONEY. Except as otherwise
expressly provided herein, the Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable
to or receivable by the Trustee pursuant to this Indenture and
44
the Master Sale and Servicing Agreement. The Trustee shall apply all such money
received by it as provided in this Indenture and the Series Supplement. Except
as otherwise expressly provided in this Indenture or in the Master Sale and
Servicing Agreement, if any default occurs in the making of any payment or
performance under any agreement or instrument that is part of the Series Trust
Estate, the Trustee may take such action as may be appropriate to enforce such
payment or performance, including the institution and prosecution of appropriate
proceedings. Any such action shall be without prejudice to any right to claim a
Default or Event of Default under this Indenture and any right to proceed
thereafter as provided in Article V.
Section 8.2 RELEASE OF TRUST PROPERTY.
(a) Subject to the payment of its fees and expenses pursuant
to Section 6.7, the Trustee may, and when required by the Issuer and the
provisions of this Indenture shall, execute instruments to release property from
the lien of this Indenture, in a manner and under circumstances that are not
inconsistent with the provisions of this Indenture. No party relying upon an
instrument executed by the Trustee as provided in this Article VIII shall be
bound to ascertain the Trustee's authority, inquire into the satisfaction of any
conditions precedent or see to the application of any monies.
(b) The Trustee shall, at such time as there are no Notes
outstanding and all sums due the Trustee pursuant to Section 6.7 have been paid,
release any remaining portion of the related Series 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 Trust Accounts. The
Trustee shall release property from the lien of this Indenture pursuant to this
Section 8.2(b) only upon receipt of an Issuer Request accompanied by an
Officer's Certificate, 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 11.1.
Section 8.3 OPINION OF COUNSEL. The Trustee shall
receive at least seven days' notice when requested by the Issuer to take any
action pursuant to Section 8.2(a), accompanied by copies of any instruments
involved, and the Trustee shall also require as a condition to such action,
an Opinion of Counsel, stating the legal effect of any such action, outlining
the steps required to complete the same, and concluding that all conditions
precedent to the taking of such action have been complied with and such
action will not materially and adversely impair the security for the Notes or
the rights of the Noteholders in contravention of the provisions of this
Indenture; PROVIDED, HOWEVER, that such Opinion of Counsel shall not be
required to express an opinion as to the fair value of the related Series
Trust Estate. Counsel rendering any such opinion may rely, without
independent investigation, on the accuracy and validity of any certificate or
other instrument delivered to the Trustee in connection with any such action.
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ARTICLE IX.
AMENDMENTS; SERIES SUPPLEMENTS
Section 9.1 AMENDMENTS WITHOUT CONSENT OF NOTEHOLDERS.
(a) Except as otherwise provided in the Series Supplement,
without the consent of the Holders of any Notes but with prior written notice to
the Rating Agencies, as evidenced to the Trustee and the Issuer, when authorized
by an Issuer Order, at any time and from time to time, the parties hereto may
enter into one or more amendments hereto, in form satisfactory to the Trustee,
for any of the following purposes:
(i) to correct or amplify the description of any property at
any time subject to the lien of this Indenture, or better to assure,
convey and confirm unto the 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 Holders of the Notes, or to surrender any right or power herein
conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any Series Supplement which may be inconsistent
with any other provision herein or in any Series Supplement or to make
any other provisions with respect to matters or questions arising under
this Indenture or in any Series Supplement; PROVIDED that such action
shall not adversely affect the interests of the Holders of the Notes;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as shall
be necessary to facilitate the administration of the trusts hereunder by
more than one trustee, pursuant to the requirements of Article VI; 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.
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The Trustee is hereby authorized to join in the execution of any
amendment and to make any further appropriate agreements and stipulations that
may be therein contained.
(b) Except as otherwise provided in the Series Supplement,
the Issuer and the Trustee, when authorized by an Issuer Order, may, also
without the consent of any of the Holders of the Notes but with prior written
notice to the Rating Agencies by the Issuer, as evidenced to the Trustee, enter
into an amendment hereto for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of, this Indenture
or of modifying in any manner the rights of the Holders of the Notes under this
Indenture; PROVIDED, HOWEVER, that such action shall not, as evidenced by an
Opinion of Counsel, adversely affect in any material respect the interests of
any Noteholder.
Section 9.2 AMENDMENTS WITH CONSENT OF NOTEHOLDERS.
Except as otherwise provided in the Series Supplement, the Issuer and the
Trustee, when authorized by an Issuer Order provided by the Master Servicer,
also may, upon satisfaction of the Rating Agency Condition and with the
consent of the Holders of not less than a majority of the Outstanding Amount
of each class of Notes affected thereby, by Act of such Holders delivered to
the Issuer and the Trustee, enter into an amendment hereto for the purpose of
adding any provisions to, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; PROVIDED, HOWEVER, that no such
amendment shall, without the consent of the Holder of each Outstanding Note
affected thereby:
(i) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof, the
interest rate thereon, change the provision of this Indenture
relating to the application of collections on, or the proceeds of
the sale of, any Series 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;
(ii) impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of funds
available therefor, as provided in Article V, to the payment of
any such amount due on the Notes on or after the respective due
dates thereof;
(iii) reduce the percentage of the Outstanding Amount of the Notes, the
consent of the Holders of which is required for any such Series
Supplement, or the consent of the Holders of which is required
for any waiver of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences
provided for in this Indenture;
(iv) modify or alter the provisions of the proviso to the definition
of the term "Outstanding";
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(v) reduce the percentage of the Outstanding Amount of the Notes
required to direct the Trustee to direct the Issuer to sell or
liquidate the Series Trust Estate pursuant to Section 5.4;
(vi) modify any provision of this Section except to increase any
percentage specified herein or to provide that certain additional
provisions of this Indenture or the Basic Documents cannot be
modified or waived without the consent of the Holder of each
Outstanding Note affected thereby;
(vii) modify any of the provisions of this Indenture in such manner as
to affect the calculation of the amount of any payment of
interest or principal due on any Note on any Distribution Date
(including the calculation of any of the individual components of
such calculation) or to affect the rights of the Holders of Notes
to the benefit of any provisions for the mandatory redemption of
the Notes contained in the Series Supplement; or
(viii) permit the creation of any lien ranking prior to or on a parity
with the lien of this Indenture with respect to any part of the
Series Trust Estate or, except as otherwise permitted or
contemplated herein or in the Series Supplement or the Series
Related Documents, terminate the lien of this Indenture on any
property at any time subject hereto or deprive the Holder of any
Note of the security provided by the lien of this Indenture.
It shall not be necessary for any Act of Noteholders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Trustee of any
amendment pursuant to this Section, the Trustee shall mail to the Holders of the
Notes to which such amendment relates a notice setting forth in general terms
the substance of such amendment. Any failure of the Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such amendment.
Prior to the execution of any amendment to this Indenture, the
Indenture Trustee shall be entitled to receive and rely upon an Opinion of
Counsel stating that the execution of such amendment is authorized or permitted
by this Indenture. The Indenture Trustee may, but shall not be obligated to,
enter into any such amendment which affects the Indenture Trustee's own rights,
duties or immunities under this Indenture.
Section 9.3 SUPPLEMENTS AUTHORIZING A SERIES OF NOTES.
(a) Each Series of Notes issued hereunder shall be issued
pursuant to a Series Supplement, which shall set forth the terms and provisions
of such Series.
(b) Amendments to Series Supplements shall be governed by the
provisions of the relevant Series Supplement. The Trustee may conclusively
rely on an
48
Opinion of Counsel as to which Series Supplements relate to which Series, or to
this Indenture (and thus all Series) as a whole.
Section 9.4 EXECUTION OF SERIES SUPPLEMENTS. In
executing, or permitting the additional trusts created by, any Series
Supplement permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive,
and subject to Sections 6.1 and 6.2, shall be fully protected in relying
upon, an Opinion of Counsel (and, if requested, an Officer's Certificate)
stating that the execution of such Series Supplement is authorized or
permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such Series Supplement that affects the Trustee's own rights,
duties, liabilities or immunities under this Indenture or otherwise.
Section 9.5 EFFECT OF SERIES SUPPLEMENT. Upon the
execution of any Series Supplement or amendment pursuant to the provisions of
such Series Supplement or hereof, this Indenture shall be and 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
Trustee, the Issuer and the Holders of the Notes 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
Series Supplement or amendment shall be and be deemed to be part of the terms
and conditions of this Indenture for any and all purposes.
Section 9.6 CONFORMITY WITH TRUST INDENTURE ACT. Every
amendment of this Indenture and every Series Supplement executed pursuant to
this Article IX shall conform to the requirements of the Trust Indenture Act
as then in effect so long as this Indenture shall then be qualified under the
Trust Indenture Act.
Section 9.7 REFERENCE IN NOTES TO SERIES SUPPLEMENTS.
Notes authenticated and delivered after the execution of any Series
Supplement pursuant to this Article IX may, and if required by the Issuer
shall, bear a notation as to any matter provided for in such Series
Supplement. If the Issuer shall so determine, new Notes so modified as to
conform, in the opinion of the Issuer, to any such Series Supplement may be
prepared and executed by the Issuer and authenticated and delivered by the
Trustee in exchange for Outstanding Notes.
ARTICLE X.
RESERVED
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ARTICLE XI.
MISCELLANEOUS
Section 11.1 COMPLIANCE CERTIFICATES AND OPINIONS, ETC.
(a) Upon any application or request by the Issuer to the
Trustee to take any action under any provision of this Indenture or any Series
Supplement, the Issuer shall furnish to the Trustee (i) an Officer's Certificate
stating that all conditions precedent, if any, provided for in this Indenture or
any Series Supplement 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 or any Series
Supplement, 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 or any Series Supplement
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 such signatory,
such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any property or securities
with the Trustee that is to be made the basis for the release of any
property or securities subject to the lien of this Indenture and the
related Series Supplement, the Issuer shall, in addition to any
obligation imposed in Section 11.1(a) or elsewhere in this Indenture or
the related Series Supplement, furnish to the Trustee an Officer's
Certificate certifying or stating the opinion of each person signing
such certificate as to the fair value (within 90 days of such deposit)
to the Issuer of the property or securities to be so deposited.
50
(ii) Whenever the Issuer is required to furnish to the Trustee
an Officer's Certificate certifying or stating the opinion of any signer
thereof as to the matters described in clause (i) above, the Issuer
shall also deliver to the Trustee an Independent Certificate as to the
same matters, if the fair value to the Issuer of the 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 delivered pursuant
to clause (i) above and this clause (ii), is 10% or more of the
Outstanding Amount of the Notes; PROVIDED, that such a certificate need
not be furnished with respect to any securities so deposited, if the
fair value thereof to the Issuer as set forth in the related Officer's
Certificate is less than $25,000 or less than 1% percent of the
Outstanding Amount of the Notes.
(iii) Other than with respect to the release of any
Repurchased Receivables or Liquidated Receivables (as such terms are
defined in the Master Sale and Servicing Agreement), whenever any
property or securities are to be released from the lien of this
Indenture and the related Series Supplement, the Issuer shall also
furnish to the 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
and the related Series Supplement in contravention of the provisions
hereof.
(iv) Whenever the Issuer is required to furnish to the 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 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 Repurchased Receivables and Defaulted
Receivables (as such terms are defined in the Master Sale and Servicing
Agreement), or securities 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 (ii) above and this clause (iii), equals
10% or more of the Outstanding Amount of the Notes; PROVIDED, that 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 1 percent of the
then Outstanding Amount of the Notes.
(v) Notwithstanding Section 2.9 or any other provision of
this Section, the Issuer may (A) collect, liquidate, sell or otherwise
dispose of Receivables as and to the extent permitted or required by the
Basic Documents and (B) make cash payments out of the Trust Accounts as
and to the extent permitted or required by the Basic Documents.
Section 11.2 FORM OF DOCUMENTS DELIVERED TO TRUSTEE. In
any case where several matters are required to be certified by, or covered by
an opinion of, any specified Person,
51
it is not necessary that all such matters be certified by, or covered by the
opinion of, only one such Person, or that they be so certified or covered by
only one document, but one such Person may certify or give an opinion with
respect to some matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such matters in one or
several documents.
Any certificate or opinion of an Authorized Officer of the Issuer
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his or her certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer
or Opinion of Counsel may be based, insofar as it relates to factual matters,
upon a certificate or opinion of, or representations by, an officer or officers
of the Master Servicer, the Seller or the Issuer, stating that the information
with respect to such factual matters is in the possession of the Master
Servicer, the Seller or the Issuer, unless such counsel knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture or any Series Supplement, in
connection with any application or certificate or report to the Trustee, it is
provided that the Issuer shall deliver any document as a condition of the
granting of such application, or as evidence of the Issuer's compliance with any
term hereof, it is intended that the truth and accuracy, at the time of the
granting of such application or at the effective date of such certificate or
report (as the case may be), of the facts and opinions stated in such document
shall in such case be conditions precedent to the right of the Issuer to have
such application granted or to the sufficiency of such certificate or report.
The foregoing shall not, however, be construed to affect the Trustee's right to
conclusively rely upon the truth and accuracy of any statement or opinion
contained in any such document as provided in Article VI.
Section 11.3 ACTS OF NOTEHOLDERS.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided
such action shall become effective when such instrument or instruments are
delivered to the 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
52
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 6.1) conclusive in favor of
the Trustee and the Issuer, if made in the manner provided in this Section.
(b) The fact and date of the execution by any person of any
such instrument or writing may be proved in any customary manner of the Trustee.
(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 Notes shall bind the Holder
of every Note issued upon the registration thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by the
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.
Section 11.4 NOTICES, ETC., TO TRUSTEE, ISSUER AND RATING
AGENCIES. Any request, demand, authorization, direction, notice, consent,
waiver or Act of Noteholders or other documents provided or permitted by this
Indenture or any Series Supplement to be made upon, given or furnished to or
filed with:
(a) The Trustee by any Noteholder or by the Issuer shall be
sufficient for every purpose hereunder if personally delivered, delivered by
overnight courier or mailed first-class and shall be deemed to have been duly
given upon receipt to the Trustee at its Corporate Trust Office, or
(b) The Issuer by the Trustee or by any Noteholder shall be
sufficient for every purpose hereunder if personally delivered, delivered by
facsimile or overnight courier or mailed first class, and shall deemed to have
been duly given upon receipt to the Issuer addressed to: Household Automotive
Trust III, in care of Wilmington Trust Company, ▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ Attention: Corporate Trust
Administration, or at any other address previously furnished in writing to the
Trustee by Issuer. The Issuer shall promptly transmit any notice received by it
from the Noteholders to the Trustee.
Notices required to be given to the Rating Agencies by the
Issuer, the Trustee or the Owner Trustee shall be in writing, personally
delivered, delivered by overnight courier or first class or via facsimile to (i)
in the case of Moody's, at the following address: ▇▇▇▇▇'▇ Investors Service,
Inc., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Fax No: (▇▇▇) ▇▇▇-▇▇▇▇ and
(ii) in the case of S&P, at the following address: Standard & Poor's Ratings
Group, ▇▇ ▇▇▇▇▇▇▇▇ (▇▇▇▇ ▇▇▇▇▇), ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Asset
Backed Surveillance Department, Fax No: (▇▇▇) ▇▇▇-▇▇▇▇; or as to each of the
foregoing, at such other address as shall be designated by written notice to the
other parties.
Section 11.5 NOTICES TO NOTEHOLDERS; WAIVER. Where this
Indenture or any Series Supplement provides for notice to Noteholders of any
event, such notice shall be
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sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at his address as it appears on the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given.
Where this Indenture or any Series Supplement 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 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 Trustee shall be deemed to be a
sufficient giving of such notice.
Where this Indenture or any Series Supplement provides for notice
to the Rating Agencies, 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 11.6 ALTERNATE PAYMENT AND NOTICE PROVISIONS.
Notwithstanding any provision of this Indenture, any Series Supplement or
any of the Notes to the contrary, the Issuer may enter into any agreement
with any Holder of a Note providing for a method of payment, or notice by the
Trustee or any Note Paying Agent to such Holder, that is different from the
methods provided for in this Indenture or the related Series Supplement for
such payments or notices, provided that such methods are reasonable and
consented to by the Trustee (which consent shall not be unreasonably
withheld). The Issuer will furnish to the Trustee a copy of each such
agreement and the Trustee will cause payments to be made and notices to be
given in accordance with such agreements.
Section 11.7 CONFLICT WITH TRUST INDENTURE ACT. If this
Indenture is qualified under the Trust Indenture Act and 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.
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Section 11.8 EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 11.9 SUCCESSORS AND ASSIGNS. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successors and assigns, whether so expressed or not. All agreements of the
Trustee in this Indenture, any Series Supplement shall bind its successors.
All agreements of the Master Servicer in this Indenture or any Series
Supplement shall bind its successors and assigns.
Section 11.10 SEPARABILITY. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality, and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
Section 11.11 BENEFITS OF INDENTURE. Nothing in this
Indenture or any Series Supplement 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 related Series
Trust Estate, any benefit or any legal or equitable right, remedy or claim
under this Indenture.
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, this Indenture or any
Series Supplement) 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 an 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, 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 so executed shall be
deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument.
Section 11.15 RECORDING OF INDENTURE. If this Indenture
or any Series Supplement is subject to recording in any appropriate public
recording offices, such recording is to be effected by the Issuer and at its
expense accompanied by an Opinion of Counsel (which may be counsel to the
Trust or any other counsel reasonably acceptable to the 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 Trustee under this Indenture or any Series
Supplement.
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Section 11.16 TRUST OBLIGATION. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the
Seller, the Master Servicer, the Owner Trustee or the Trustee on the Notes or
under this Indenture or any Series Supplement or any certificate or other
writing delivered in connection herewith or therewith, against (i) the
Seller, the Master Servicer, the 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 Seller, the Master Servicer, the Trustee or the Owner Trustee in
its individual capacity, any holder of a beneficial interest in the Issuer,
the Seller, the Master Servicer, the Owner Trustee or the Trustee or of any
successor or assign of the Seller, the Master Servicer, the Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Trustee and the Owner Trustee
have no such obligations in their individual capacity) and except that any
such 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 VI,
VII, and VIII of the Trust Agreement.
Section 11.17 NO PETITION. The Trustee, by entering into
this Indenture, and each Noteholder, by accepting a Note, hereby covenant and
agree that they will not at any time institute against the Seller, or the
Issuer, or join in, cooperate with or encourage others in connection with the
institution against the Seller, or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States Federal or state bankruptcy or similar
law in connection with any obligations relating to the Notes, this Indenture
or any of the Basic Documents or any of the Series Related Documents.
Section 11.18 LIMITED RECOURSE.
(a) Notwithstanding anything in the Series 1999-1 Related
Documents to the contrary, the Series 1991-1 Notes constitute limited recourse
obligations of the Issuer and are limited in recourse to the Series 1999-1 Trust
Estate. The Trustee, by entering into this Indenture and the related Series
1999-1 Supplement, and each Series 1999-1 Noteholder agree that recourse for the
Series 1999-1 Notes is limited to the Series 1999-1 Trust Estate and, if the
Series 1999-1 Trust Estate shall prove to be insufficient to pay amounts due
under the Series 1999-1, shall have no claim against the assets of the Issuer or
the Seller other than the Series 1999-1 Trust Estate.
(b) If, notwithstanding paragraph (a) above, the Series
1999-1 Noteholders are deemed to have any interest in any asset of the Seller
other than the Seller's interest in the Series 1999-1 Trust Estate, including
any interest in assets of the Seller pledged to secure debt obligations of the
Seller other than the Series 1999-1 Notes, the Trustee, by entering into this
Indenture and the related Series 1999-1 Supplement, and each Series 1999-1
Noteholder agree that any such interest is subordinate to the claims of the
holders of any such debt obligations, and the Series 1999-1 Noteholders shall
have no
56
rights in such assets until such other debt obligations are indefeasibly paid in
full. The agreement of the Trustee and the Series 1999-1 Noteholders pursuant
to this Section 11.18(b) is intended to constitute a subordination agreement for
the purposes of Section 510(a) of the Bankruptcy Code.
Section 11.19 INSPECTION. The Issuer agrees that, on
reasonable prior notice, it will permit any representative of the Trustee,
during the Issuer's normal business hours, to examine all the books of
account, records, reports, and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by independent
certified public accountants, and to discuss the Issuer's affairs, finances
and 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 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 Trustee may
reasonably determine that such disclosure is consistent with its Obligations
hereunder.
Section 11.20 LIMITATION OF LIABILITY. It is expressly
understood and agreed by the parties hereto that (a) this Agreement is
executed and delivered by Wilmington Trust Company, not individually or
personally but solely as Owner Trustee of the Issuer under the Trust
Agreement, in the exercise of the powers and authority conferred and vested
in it, (b) each of the representations, undertakings and agreements herein
made on the part of the Issuer is made and intended not as personal
representations, undertakings and agreements by Wilmington Trust Company but
is made and intended for the purpose for binding only the Issuer, (c) nothing
herein contained shall be construed as creating any liability on Wilmington
Trust Company individually or personally, to perform any covenant either
expressed or implied contained herein, all such liability, if any, being
expressly waived by the parties to this Agreement and by any person claiming
by, through or under them and (d) under no circumstances shall Wilmington
Trust Company be personally liable for the payment of any indebtedness or
expenses of the Issuer or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaking by the
Issuer under this Agreement or any related documents.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Issuer, the Master Servicer and the
Trustee have caused this Indenture to be duly executed by their respective
officers, hereunto duly authorized, all as of the day and year first above
written.
HOUSEHOLD AUTOMOTIVE TRUST III
By: WILMINGTON TRUST COMPANY, not in its individual
capacity but solely as Owner Trustee
By:
---------------------------------------------
Name:
Title:
HOUSEHOLD FINANCE CORPORATION.
as Master Servicer
By:
---------------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, not in its
individual capacity but solely as Trustee
By:
---------------------------------------------
Name:
Title:
[Signature Page for the Indenture]
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