Exhibit 4.2
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INDENTURE
between
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ANRC AUTO OWNER TRUST ____,
as Issuer
and
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______________________,
as Indenture Trustee
Dated as of _______,_____
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TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE................................. 2
Section 1.01 Definitions................................................................ 2
Section 1.02 Incorporation by Reference of Trust Indenture Act.......................... 8
Section 1.03 Rules of Construction...................................................... 9
ARTICLE II THE NOTES.................................................................. 10
Section 2.01 Form....................................................................... 10
Section 2.02 Execution, Authentication and Delivery..................................... 10
Section 2.03 Temporary Notes............................................................ 11
Section 2.04 Registration; Registration of Transfer and Exchange........................ 11
Section 2.05 Mutilated, Destroyed, Lost or Stolen Notes................................. 12
Section 2.06 Persons Deemed Owner....................................................... 13
Section 2.07 Payment of Principal and Interest; Defaulted Interest...................... 13
Section 2.08 Cancellation............................................................... 15
Section 2.09 Book-Entry Notes........................................................... 15
Section 2.10 Notices to Clearing Agency................................................. 16
Section 2.11 Definitive Notes........................................................... 16
Section 2.12 Release of Collateral...................................................... 17
Section 2.13 Tax Treatment.............................................................. 17
Section 2.14 ERISA...................................................................... 17
Section 2.15 CUSIP Numbers.............................................................. 17
Section 2.16 Issuer's Obligations Absolute.............................................. 17
Section 2.17 Authenticating Agent....................................................... 18
ARTICLE III COVENANTS.................................................................. 19
Section 3.01 Payment of Principal and Interest.......................................... 19
Section 3.02 Maintenance of Office or Agency............................................ 19
Section 3.03 Money for Payments to be Held in Trust..................................... 19
Section 3.04 Existence.................................................................. 21
Section 3.05 Protection of Collateral................................................... 21
Section 3.06 Opinions as to Collateral.................................................. 22
Section 3.07 Performance of Obligations; Servicing of Contracts......................... 22
Section 3.08 Negative Covenants......................................................... 24
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Section 3.09 Annual Statement as to Compliance.......................................... 24
Section 3.10 Issuer May Consolidate, etc. Only on Certain Terms......................... 25
Section 3.11 Successor Transferee....................................................... 27
Section 3.12 No Other Business.......................................................... 27
Section 3.13 Servicer's Obligations..................................................... 27
Section 3.14 Restricted Payments........................................................ 27
Section 3.15 Notice of Events of Default................................................ 28
Section 3.16 Further Instruments and Acts............................................... 28
Section 3.17 No Borrowing............................................................... 28
Section 3.18 Compliance with Laws....................................................... 28
Section 3.19 Amendments of Sale and Servicing Agreement and Owner Trust Agreement....... 28
Section 3.20 Maintenance of Books and Records........................................... 28
Section 3.21 Guarantees, Loans, Advances and Other Liabilities.......................... 28
Section 3.22 Capital Expenditures....................................................... 29
Section 3.23 Removal of Administrator................................................... 29
ARTICLE IV SATISFACTION AND DISCHARGE................................................. 30
Section 4.01 Satisfaction and Discharge of Indenture.................................... 30
Section 4.02 Application of Trust Money................................................. 31
Section 4.03 Repayment of Monies Held by Paying Agent................................... 31
Section 4.04 Effect of Payments by the Insurer; Subrogation............................. 31
ARTICLE V EVENTS OF DEFAULT; REMEDIES................................................ 33
Section 5.01 Events of Default.......................................................... 33
Section 5.02 Rights Upon Event of Default............................................... 34
Section 5.03 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee.. 35
Section 5.04 Remedies................................................................... 38
Section 5.05 Optional Preservation of the Contracts..................................... 39
Section 5.06 Priorities................................................................. 39
Section 5.07 Limitation of Suits........................................................ 40
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Section 5.08 Unconditional Rights of Noteholders to Receive Principal and Interest...... 41
Section 5.09 Restoration of Rights and Remedies......................................... 41
Section 5.10 Rights and Remedies Cumulative............................................. 42
Section 5.11 Delay or Omission Not a Waiver............................................. 42
Section 5.12 Control by Noteholders..................................................... 42
Section 5.13 Waiver of Past Defaults.................................................... 42
Section 5.14 Undertaking for Costs...................................................... 43
Section 5.15 Waiver of Stay or Extension Laws........................................... 43
Section 5.16 Action on Notes............................................................ 43
Section 5.17 Performance and Enforcement of Certain Obligations......................... 44
ARTICLE VI THE INDENTURE TRUSTEE...................................................... 45
Section 6.01 Duties of Indenture Trustee................................................ 45
Section 6.02 Rights of Indenture Trustee................................................ 47
Section 6.03 Individual Rights of Indenture Trustee..................................... 48
Section 6.04 Indenture Trustee's Disclaimer............................................. 49
Section 6.05 Notice of Defaults......................................................... 49
Section 6.06 Reports by Indenture Trustee to Holders.................................... 49
Section 6.07 Compensation and Indemnity................................................. 49
Section 6.08 Replacement of Indenture Trustee........................................... 50
Section 6.09 Successor Indenture Trustee by Merger...................................... 51
Section 6.10 Appointment of Co-Indenture Trustee or Separate Indenture Trustee.......... 52
Section 6.11 Eligibility; Disqualification.............................................. 53
Section 6.12 Preferential Collection of Claims Against Issuer........................... 53
Section 6.13 Representations and Warranties of Indenture Trustee........................ 53
Section 6.14 Waiver of Setoffs.......................................................... 54
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS............................................. 55
Section 7.01 Indenture Trustee to Furnish Issuer Names and Addresses of Noteholders..... 55
Section 7.02 Preservation of Information; Communications to Noteholders................. 55
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Section 7.03 Reports by Issuer.......................................................... 55
Section 7.04 Fiscal Year................................................................ 56
Section 7.05 Reports by Indenture Trustee............................................... 56
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES....................................... 57
Section 8.01 Collection of Money........................................................ 57
Section 8.02 Trust Accounts............................................................. 57
Section 8.03 Release of Collateral...................................................... 58
Section 8.04 Opinion of Counsel......................................................... 59
ARTICLE IX SUPPLEMENTAL INDENTURES.................................................... 60
Section 9.01 Supplemental Indentures Without Consent of Noteholders..................... 60
Section 9.02 Supplemental Indentures With Consent of Noteholders........................ 61
Section 9.03 Execution of Supplemental Indentures....................................... 62
Section 9.04 Effect of Supplemental Indenture........................................... 63
Section 9.05 Conformity With Trust Indenture Act........................................ 63
Section 9.06 Reference in Notes to Supplemental Indentures.............................. 63
ARTICLE X REDEMPTION OF NOTES........................................................ 64
Section 10.01 Redemption................................................................. 64
Section 10.02 Form of Redemption Notice.................................................. 64
Section 10.03 Notes Payable on Redemption Date........................................... 64
ARTICLE XI MISCELLANEOUS.............................................................. 66
Section 11.01 Compliance Certificates and Opinions, etc. ................................ 66
Section 11.02 Form of Documents Delivered to Indenture Trustee........................... 67
Section 11.03 Acts of Noteholders........................................................ 68
Section 11.04 Notices, etc., to Indenture Trustee, Issuer, Insurer and Rating Agencies... 69
Section 11.05 Notices to Noteholders; Waiver............................................. 69
Section 11.06 Alternate Payment and Notice Provisions.................................... 70
Section 11.07 Conflict With Trust Indenture Act.......................................... 70
Section 11.08 Effect of Headings and Table of Contents................................... 70
Section 11.09 Successors and Assigns..................................................... 70
Section 11.10 Separability............................................................... 71
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Section 11.11 Benefits of Indenture...................................................... 71
Section 11.12 Legal Holidays............................................................. 71
Section 11.13 Governing Law.............................................................. 71
Section 11.14 Counterparts............................................................... 71
Section 11.15 Recording of Indenture..................................................... 71
Section 11.16 Trust Obligation........................................................... 71
Section 11.17 No Petition................................................................ 72
Section 11.18 Inspection................................................................. 72
Section 11.19 Limitation of Liability of Owner Trustee................................... 72
Section 11.20 Certain Matters Regarding the Insurer...................................... 73
EXHIBITS
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Schedule A -- Schedule of Contracts
Exhibit A -- Form of Depository Agreement
Exhibit B -- Form of Class A-1 Note
Exhibit C -- Form of Class A-2 Note
Exhibit D -- Form of Class A-3 Note
Exhibit E -- Form of Class A-4 Note
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THIS INDENTURE, dated as of______________,_________(as amended,
supplemented or otherwise modified and in effect from time to time, this
"Agreement"), is between ANRC Auto Owner Trust____________,a Delaware business
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trust, as the Issuer, and ___________, a______________banking corporation, as
the Indenture Trustee.
Each party agrees as follows for the benefit of the other parties and the
Insurer and for the equal and ratable benefit of the holders of the Issuer's
________% Asset-Backed Notes, Class A-1 (the "Class A-1 Notes"), ___________%
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Asset-Backed Notes, Class A-2 (the "Class A-2 Notes"), _________% Asset-Backed
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Notes, Class A-3 (the "Class A-3 Notes") and ___________% Asset-Backed Notes,
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Class A-4 (the "Class A-4 Notes" and, together with the Class A-1 Notes, the
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Class A-2 Notes and the Class A-3 Notes, the "Notes"):
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GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee on the Closing Date, on
behalf of and for the benefit of the Holders of the Notes and the Insurer,
without recourse, all of the Issuer's right, title and interest in, to and under
the Collateral.
The foregoing Grant is made in trust to secure the payment of principal of
and interest on, and any other amounts owing in respect of, the Notes, equally
and ratably without prejudice, priority or distinction, and to secure compliance
with the provisions of this Indenture and the Insurance Agreement, all as
provided in this Indenture and the Insurance Agreement.
The Indenture Trustee, as Indenture Trustee on behalf of the Holders of the
Notes and the Insurer, acknowledges such Grant, accepts the trusts under this
Indenture in accordance with the provisions of this Indenture and agrees to
perform its duties required in this Indenture to the best of its ability to the
end that the interests of the Holders of the Notes and the Insurer may be
adequately and effectively protected.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
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(a) Except as otherwise specified herein or as the context may
otherwise require, (i) capitalized terms that are used herein that are not
otherwise defined herein shall have the meanings assigned to them in the Sale
and Servicing Agreement (as defined below) and (ii) the following terms have the
respective meanings set forth below for all purposes of this Indenture.
"Act" shall have the meaning specified in Section 11.03(a).
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"Administration Agreement" shall mean the Administration Agreement,
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dated as of __________, _____, by and among the Administrator, the Issuer, the
Seller and the Indenture Trustee, as the same may be amended, supplemented or
otherwise modified and in effect from time to time.
"Administrator" shall mean AutoNation Financial Services Corp., or any
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successor Administrator under the Administration Agreement.
"Authorized Officer" shall mean, with respect to the Issuer, any
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officer of the Owner Trustee who is authorized to act for the Owner Trustee in
matters relating to the Issuer and who is identified on the list of Authorized
Officers delivered by the Owner Trustee to the Indenture Trustee and the Insurer
on the Closing Date (as such list may be modified or supplemented from time to
time thereafter) and, so long as the Administration Agreement is in effect, any
officer of the Administrator who is authorized to act for the Administrator in
matters relating to the Issuer and to be acted upon by the Administrator
pursuant to the Administration Agreement and who is identified on a list of
Authorized Officers delivered by the Administrator to the Indenture Trustee and
the Insurer on the Closing Date (as such list may be modified or supplemented
from time to time thereafter).
"Basic Documents" shall mean the Certificate of Trust, the Owner Trust
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Agreement, the Sale and Servicing Agreement, the Administration Agreement, the
Receivables Purchase Agreement, the Depository Agreement, the Insurance
Agreement, the Insurance Policy, the Indemnification Agreement (as defined in
the Insurance Agreement), the Securities Account Control Agreement, the
Custodial Agreement and this Indenture and the other documents and certificates
delivered in connection therewith.
"Book-Entry Notes" shall mean a beneficial interest in the Notes,
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ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.09.
"Certificate of Trust" shall mean the Certificate of Trust of the
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Issuer substantially in the form of Exhibit A to the Owner Trust Agreement.
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"Class" shall mean a class of Notes whose form is identical except for
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variation in denomination, principal amount or owner.
"Class A-1 Notes" shall mean the Class A-1 Notes, substantially in the
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form of Exhibit B.
"Class A-2 Notes" shall mean the Class A-2 Notes, substantially in the
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form of Exhibit C.
"Class A-3 Notes" shall mean the Class A-3 Notes, substantially in the
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form of Exhibit D.
"Class A-4 Notes" shall mean the Class A-4 Notes, substantially in the
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form of Exhibit E.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
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time to time, and Treasury Regulations promulgated thereunder.
"Collateral" shall mean the Trust Property.
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"Controlling Party" shall mean the Insurer, so long as no Insurer
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Default shall have occurred and be continuing, and the Indenture Trustee, for
the benefit of the Noteholders, for so long as an Insurer Default shall have
occurred and be continuing.
"Default" shall mean any occurrence that is, or with notice or the
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lapse of time or both would become, an Event of Default.
"Definitive Notes" shall have the meaning specified in Section 2.09.
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"Depository Agreement" shall mean the agreement dated as of ________,
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____, by and among the Issuer, the Indenture Trustee, the Owner Trustee and DTC,
as the initial Clearing Agency substantially in the form of Exhibit A hereto, as
the same may be amended, supplemented or otherwise modified and in effect from
time to time.
"DTC" shall mean The Depository Trust Company.
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"Event of Default" shall have the meaning specified in Section 5.01.
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"Executive Officer" shall mean, with respect to any corporation or
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bank, the Chief Executive Officer, Chief Operating Officer, Chief Financial
Officer, President, Executive Vice President, any Vice President, the Secretary,
the Treasurer or Assistant Treasurer of such corporation or bank; and with
respect to any partnership, any general partner thereof.
"Fees" shall mean amounts due to be paid to the Owner Trustee in
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connection with its performance as Owner Trustee in connection with ANRC Auto
Owner Trust _______.
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"Grant" shall mean to mortgage, pledge, bargain, sell, warrant,
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alienate, remise, release, convey, assign, transfer, create and ▇▇▇▇▇ ▇ ▇▇▇▇
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to this Indenture. A Grant of the Collateral or of any
other agreement or instrument shall include all rights, powers and options (but
none of the obligations) of the granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments in respect of the Collateral and all other
monies payable thereunder, to give and receive notices and other communications,
to make waivers or other agreements, to exercise all rights and options, to
bring Proceedings in the name of the granting party or otherwise and generally
to do and receive anything that the granting party is or may be entitled to do
or receive thereunder or with respect thereto.
"Indebtedness" shall mean, with respect to any Person at any time, (i)
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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); (ii)
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; (iii) current liabilities of such Person in respect of
unfunded vested benefits under plans covered by Title IV of ERISA; (iv)
obligations issued for or liabilities incurred on the account of such Person;
(v) obligations or liabilities of such Person arising under acceptance
facilities; (vi) obligations of such Person under any guaranties, 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; (vii) 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 (viii) obligations of such Person under any interest rate or currency
exchange agreement.
"Indenture" shall mean this Agreement, as amended, supplemented or
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otherwise modified and in effect from time to time.
"Indenture Trustee" shall mean _______________, a ________ banking
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corporation, as Indenture Trustee under this Indenture, or any successor
Indenture Trustee under this Indenture.
"Independent" when used with respect to any specified Person, shall
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mean such a Person who (i) is in fact independent of the Issuer, the Seller and
any of their respective Affiliates, (ii) is not a director, officer or employee
of the Issuer, the Seller or any of their respective Affiliates, (iii) is not a
person related to any officer or director of the Issuer, the Seller or any of
their respective Affiliates, (iv) is not a holder (directly or indirectly) of
more than 10% of any voting securities of the Issuer, the Seller or any of their
respective Affiliates, and (v) is not connected with the Issuer, the Seller or
any of their respective Affiliates as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
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"Independent Certificate" shall mean a certificate or opinion to be
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delivered to the Indenture Trustee and the Insurer under the circumstances
described in, and otherwise complying with, the applicable requirements of
Section 11.01, made by an Independent appraiser or other expert appointed by an
Issuer Order and approved by the Indenture Trustee and the Insurer, 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.
"Insurer Default" shall have the meaning set forth in the Sale and
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Servicing Agreement.
"Issuer" shall mean ANRC Auto Owner Trust _________ or any successor
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pursuant to the terms of this Indenture as Issuer under this Indenture.
"Issuer Order" and "Issuer Request" shall mean a written order or
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request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Indenture Trustee.
"Noteholder" or "Holder" shall mean (a) the Person in whose name a
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Note is registered on the Note Register or (b) if the Insurer has made a payment
under the Insurance Policy, the Insurer to the extent provided in Section 2.07
or 4.04 of this Indenture, the proviso to the definition of Outstanding herein
and Section 4.06 of the Sale and Servicing Agreement.
"Note Owner" shall mean, with respect to a Book-Entry Note, the Person
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who is the owner of the beneficial interest 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 Register" and "Note Registrar" have the respective meanings
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specified in Section 2.04.
"Officer's Certificate" shall mean a certificate signed by any
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Authorized Officer of the Issuer, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01, and
delivered to the Indenture Trustee and the Insurer.
"Opinion of Counsel" shall mean a written opinion of counsel (who may,
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except as otherwise expressly provided in this Indenture, be an employee of, or
counsel to, the Depositor or the Issuer or any of their respective Affiliates)
acceptable to the Indenture Trustee and the Insurer, and which opinion shall
comply with any applicable requirements of Section 11.01, and shall be in form
and substance satisfactory to and shall be addressed to the Indenture Trustee,
and the Insurer.
"Outstanding" shall mean, as of the date of determination, all Notes
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theretofore authenticated and delivered under this Indenture except:
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(i) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in
the necessary amount has been theretofore deposited with the Indenture
Trustee or any Paying Agent in trust for the Holders of such Notes
(provided, however, that if such Notes are to be redeemed, notice of such
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redemption has been duly given pursuant to this Indenture or provision for
such notice, satisfactory to the Indenture 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 Indenture Trustee is presented that any such Notes are
held by a bona fide purchaser;
provided, however, that Notes that have been paid with proceeds of the Insurance
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Policy shall continue to remain Outstanding for purposes of this Indenture until
the Insurer has been paid as subrogee hereunder or reimbursed pursuant to the
Insurance Agreement, as evidenced by a written notice from the Insurer delivered
to the Indenture Trustee, and the Insurer shall be deemed to be the Holder of
such Notes to the extent of any unreimbursed payments made thereon by the
Insurer; provided further, that in determining whether the Holders of the
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requisite Outstanding Principal Amount have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or under any other
Basic Document, Notes owned by the Issuer, the Seller or any of their respective
Affiliates shall be disregarded and deemed not to be Outstanding, except that,
in determining whether the Indenture Trustee shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Notes that a Responsible Officer of the Indenture Trustee has actual
knowledge are so owned shall be so disregarded. Notes so owned that have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Indenture Trustee the pledgee's right so to act with
respect to such Notes and that the pledgee is not the Issuer, the Seller or any
of their respective Affiliates.
"Outstanding Principal Amount" shall mean the aggregate principal
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amount of all Notes of one Class or of all Classes, as the case may be,
Outstanding at the date of determination.
"Owner Trust Agreement" shall mean the Amended and Restated Owner
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Trust Agreement, dated as of_______, ____, between the Seller and the Owner
Trustee, as the same may be amended, supplemented or otherwise modified and in
effect from time to time.
"Paying Agent" shall mean the Indenture Trustee or any other Person
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that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11, is acceptable to the Insurer and is authorized by the Issuer to
make the distributions from the Note Distribution Account, including payment of
principal of or interest on the Notes, on behalf of the Issuer.
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"Payment Date" shall mean the __th day of each calendar month, or, if
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any such date is not a Business Day, the next succeeding Business Day,
commencing on _____, ___.
"Predecessor Note" shall mean, with respect to any particular Note,
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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 2.05 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" shall mean any suit in equity, action at law or other
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judicial or administrative proceeding.
"Rating Agency Condition" shall mean, for so long as any Notes remain
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Outstanding and are rated by a Rating Agency, with respect to any action, that
(i) each such Rating Agency shall have been given ten Business Days (or such
shorter period as is acceptable to each such Rating Agency) prior notice thereof
and that each Rating Agency shall have notified the Seller, the Servicer, the
Insurer and the Issuer in writing that such action will not result in a
qualification, reduction or withdrawal of its then-current rating of any Class
of Notes, and (ii) each Rating Agency shall have confirmed to the Insurer that
the shadow rating of the Notes to the Insurer will not be lowered.
"Rating Event" shall mean the qualification, reduction or withdrawal
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by either Rating Agency of its then-current rating of any Class of Notes,
without regard to the Insurance Policy.
"Record Date" shall mean, with respect to a Distribution Date or the
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Redemption Date, the close of business on the Business Day immediately prior to
such Distribution Date or Redemption Date, or, in the event that Definitive
Notes are issued, the close of business on the last day of the calendar month
immediately preceding the month in which such Distribution Date or Redemption
Date occurs.
"Redemption Date" shall mean the Distribution Date specified by the
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Servicer or the Issuer pursuant to Section 10.01.
"Redemption Price" shall mean in the case of a redemption of the Notes
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pursuant to Section 10.01, an amount equal to the unpaid principal amount of the
Notes redeemed plus accrued and unpaid interest thereon at the respective Note
Rates of each Class of Notes being so redeemed to but excluding the Redemption
Date.
"Registered Holder" shall mean the Person in whose name a Note is
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registered on the Note Register on the applicable Record Date.
"Sale and Servicing Agreement" shall mean the Sale and Servicing
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Agreement, dated as of ____________, _____, by and among the Issuer, the Seller,
the Indenture Trustee, the Servicer and the Custodian, as the same may be
amended, supplemented or otherwise modified and in effect from time to time.
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"Securities Account Control Agreement" shall mean the Securities
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Account Control Agreement, dated as of _____________, _____, among the Issuer,
the Seller and the Indenture Trustee, as the same may be amended, supplemented
or otherwise modified and in effect from time to time.
"State" shall mean any one of the ▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ of
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America or the District of Columbia.
"Termination Date" shall mean the latest of (i) the date on which the
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Notes have been paid in full and the Indenture Trustee has returned the
Insurance Policy to the Insurer for cancellation, (ii) the date on which the
Insurer shall have received payment and performance of all amounts and
obligations owed to or on behalf of the Insurer under this Indenture or the
other Basic Documents and (iii) the date on which the Indenture Trustee shall
have received payment and performance of all amounts and obligations which the
Issuer and the Administrator may owe to or on behalf of the Indenture Trustee
for the benefit of the Noteholders under the Basic Documents or the Notes.
"Trust Indenture Act" or "TIA" shall mean the Trust Indenture Act of
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1939, as amended, as in full force and effect on the date hereof, unless
otherwise specifically provided.
SECTION 1.02. Incorporation by Reference of Trust Indenture Act.
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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" shall mean the Securities and Exchange Commission.
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"Indenture Securities" shall mean the Notes.
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"Indenture Security Holder" shall mean a Noteholder.
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"Indenture to be Qualified" shall mean this Indenture.
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"Indenture Trustee" or "Institutional Trustee" shall mean the
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Indenture Trustee.
"Obligor" on the indenture securities shall mean the Issuer and any
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other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
have the meaning assigned to them by such definitions.
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SECTION 1.03. Rules of Construction. Unless the context
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otherwise requires:
(i) a term shall have the meaning assigned to it;
(ii) as used in this Indenture and in any certificate or other
document made or delivered pursuant hereto or thereto, an accounting term
not otherwise defined shall have the meaning assigned to it in accordance
with generally accepted accounting principles as in effect from time to
time. To the extent that the definitions of accounting terms in this
Indenture or in any such certificate or other document are inconsistent
with the meanings of such terms under generally accepted accounting
principles, the definitions contained in this Indenture or in any such
certificate or other document shall control;
(iii) "or" is not exclusive;
(iv) "including" shall mean including without limitation;
(v) words in the singular include the plural and words in the
plural include the singular;
(vi) any agreement, instrument or statute defined or referred
to herein or in any instrument or certificate delivered in connection
herewith shall mean such agreement, instrument or statute as from time to
time amended, modified or supplemented and includes (in the case of
agreements or instruments) references to all attachments thereto and
instruments incorporated therein;
(vii) references to a Person are also to its permitted
successors and assigns; and
(viii) the words "hereof," "herein" and "hereunder" and words of
similar import when used in this Indenture shall refer to this Indenture as
a whole and not to any particular provision of this Indenture; Section,
subsection and Exhibit references contained in this Indenture are
references to Sections, subsections and Exhibits in or to this Indenture
unless otherwise specified.
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ARTICLE II
THE NOTES
SECTION 2.01. Form. The Class A-1 Notes, the Class A-2 Notes, the
----
Class A-3 Notes and the Class A-4 Notes, in each case together with the
Indenture Trustee's certificate of authentication, shall be in substantially the
forms set forth as Exhibits B, C, D and E to this Indenture with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon as
may, consistently herewith, be determined by the officers executing such Notes,
as evidenced by their execution of the Notes. Any portion of the text of any
Note may be set forth on the reverse thereof, with an appropriate reference
thereto on the face of the Note.
Each Note shall be dated the date of its authentication. The terms of the
Notes set forth in Exhibits B, C, D and E hereto are part of the terms of this
Indenture.
SECTION 2.02. Execution, Authentication and Delivery. The Notes shall be
--------------------------------------
executed on behalf of the Issuer by the Owner Trustee, as provided in the Owner
Trust Agreement by any of the Owner Trustee's Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals who were at
any time Authorized Officers of the Owner Trustee shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
The Indenture Trustee shall, upon receipt of an Issuer Order,
authenticate and deliver for original issue the following aggregate principal
amount of Notes: (i) $ __________Class ▇- ▇ ▇▇▇▇▇, (▇▇) $ __________ of Class ▇-
▇ ▇▇▇▇▇, (▇▇▇) $ _________ of Class A-3 Notes and (iv) $ _________ principal
amount of Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4 Notes
outstanding at any time may not exceed such respective amounts, except as
otherwise provided in Section 2.05.
Each Note shall be dated the date of its authentication. The Notes
shall be issuable as registered Notes in the minimum denomination of $1,000 and
in integral multiples of $1,000 in excess thereof, except that one Note of each
Class may be issued in a different denomination.
No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication substantially in the form provided for in the forms of Notes
attached as exhibits to this Indenture executed by the Indenture Trustee by the
manual signature of one of its authorized signatories, and such certificate upon
any Note shall be conclusive
10
evidence, and the only evidence, that such Note has been duly authenticated and
delivered hereunder.
SECTION 2.03. Temporary Notes. Pending the preparation of definitive
---------------
Notes, the Issuer may execute, and upon receipt of an Issuer Order the Indenture
Trustee shall authenticate and deliver, temporary Notes that are printed,
lithographed, engraved, 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 are issued, the Issuer will cause definitive Notes
to be prepared without unreasonable delay. After the preparation of definitive
Notes, the temporary Notes shall be exchangeable for definitive Notes upon
surrender of the temporary Notes at the office or agency of the Issuer to be
maintained as provided in Section 3.02, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Notes, the Issuer shall
execute and the Indenture Trustee shall authenticate and deliver in exchange
therefor a like tenor and principal amount of definitive Notes of authorized
denominations. Until so exchanged, the temporary Notes shall in all respects be
entitled to the same benefits under this Indenture as definitive Notes.
SECTION 2.04. Registration; Registration of Transfer and Exchange.
---------------------------------------------------
The Issuer shall cause to be kept a register (the "Note Register") in which,
-------------
subject to such reasonable regulations as it may prescribe, the Issuer shall
provide for the registration of Notes and the registration of transfers of
Notes. The Indenture Trustee 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 Indenture Trustee is appointed by the
Issuer as Note Registrar, the Issuer will give the Indenture Trustee and the
Insurer prompt written notice of the appointment of such Note Registrar and of
the location, and any change in the location, of the Note Register, and the
Indenture Trustee and the Insurer shall have the right to inspect the Note
Register at all reasonable times and to obtain copies thereof, and the Indenture
Trustee and the Insurer shall have the right to rely upon a certificate executed
on behalf of the Note Registrar by an Executive 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 of transfer of any Note at the office
or agency of the Issuer to be maintained as provided in Section 3.02, the Issuer
shall execute, and the Indenture Trustee shall authenticate and the Noteholder
shall obtain from the Indenture Trustee, in the name of the designated
transferee or transferees, one or more new Notes of the same Class in any
authorized denominations, of a like aggregate principal amount.
11
At the option of the Holder, Notes may be exchanged for other Notes of
the same Class in any authorized denominations, of a like aggregate principal
amount, upon surrender of the Notes to be exchanged at such office or agency.
Whenever any Notes are so surrendered for exchange, the Issuer shall execute,
and the Indenture Trustee shall authenticate and the Noteholder shall obtain
from the Indenture Trustee, the Notes which the Noteholder making the exchange
is entitled to receive.
All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed by, or be accompanied by a written instrument of
transfer in form satisfactory to the Indenture Trustee duly executed by, the
Holder thereof or such Holder's attorney duly authorized in writing, with such
signature guaranteed by a commercial bank or trust company located, or having a
correspondent located, in the city of New York or the city in which the
Corporate Trust Office is located, or by a member firm of a national securities
exchange, and such other documents as the Indenture Trustee may require.
No service charge shall be made to a Holder for any registration of
transfer or exchange of Notes, but the Issuer or the Indenture Trustee may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges pursuant to Section 2.03, 2.07(c) or
9.06 not involving any transfer.
The preceding provisions of this Section notwithstanding, the Issuer
shall not be required to make, and the Note Registrar need not register,
transfers or exchanges of Notes selected for redemption or of any Note (i) for a
period of 15 days preceding the due date for any payment with respect to the
Note or (ii) after the Indenture Trustee sends a notice of redemption with
respect to such Note in accordance with Section 10.01.
The provisions of this Section 2.04 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
transfer of Notes.
SECTION 2.05. Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
------------------------------------------
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Indenture Trustee and the Insurer such
security or indemnity as may be required by them to hold the Issuer, the
Indenture Trustee and the Insurer harmless, then, in the absence of notice to
the Issuer, the Note Registrar or a Responsible Officer of the Indenture 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 Indenture Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a
replacement Note of the same Class; provided that if any such destroyed, lost or
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stolen
12
Note, but not a mutilated Note, shall have become, or within 15 days shall be,
due and payable, or shall have been called for redemption, instead of issuing a
replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so
due or payable or upon the Redemption Date without surrender thereof. 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, the Insurer and the Indenture Trustee
shall be entitled to recover such replacement Note (or such payment) from the
Person to whom it was delivered or any Person taking such replacement Note from
such Person to whom such replacement Note was delivered or any assignee of such
Person, except a 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, the Insurer or the Indenture Trustee in
connection therewith.
Upon the issuance of any replacement Note under this Section 2.05, the
Issuer or the Indenture Trustee may require the payment by the Holder of such
Note of a sum sufficient to cover any tax or other governmental charge that may
be imposed in relation thereto and any other reasonable expenses (including the
fees and expenses of the Indenture Trustee or the Note Registrar and/or counsel)
in connection therewith.
Every replacement Note issued pursuant to this Section 2.05 in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
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 2.06. Persons Deemed Owner. Prior to due presentment for
--------------------
registration of transfer of any Note, the Issuer, the Indenture Trustee, the
Insurer and any of their respective agents may treat the Person in whose name
any Note is registered (as of the day of determination) as the owner of such
Note for the purpose of receiving payments of principal of and interest, if any,
on such Note and for all other purposes whatsoever, whether or not such Note may
be overdue, and none of the Issuer, the Insurer, the Indenture Trustee or any of
their respective agents shall be affected by notice to the contrary.
SECTION 2.07. Payment of Principal and Interest; Defaulted Interest.
-----------------------------------------------------
(a) Each Class of Notes shall accrue interest during each Interest
Accrual Period at the related Note Rate, and such interest shall be payable
monthly on each Distribution Date as specified therein, subject to Section 3.01.
Interest accrued on any Note but not paid on any Distribution Date will be due
on the immediately
13
succeeding Distribution Date, together with, to the extent permitted by
applicable law, interest on such shortfall at the related Note Rate. Interest on
the Class A-1 Notes shall be calculated on the basis of the actual number of
days in the related Interest Accrual Period and a 360-day year. Interest on the
Class A-2 Notes, Class A-3 Notes and the Class A-4 Notes will be calculated on
the basis of a 360-day year consisting of twelve 30-day months. Any installment
of interest or principal, if any, payable on any Note which is punctually paid
or duly provided for by the Issuer on the applicable Distribution Date shall be
paid 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, unless Definitive Notes have been issued pursuant to Section 2.11,
with respect to Notes registered on the Record Date in the name of the nominee
of the Clearing Agency (initially, such nominee to be Cede & Co.), payment will
be made by wire transfer in immediately available funds to the account
designated by such nominee. Notwithstanding the foregoing, the final installment
of principal payable with respect to any Note (whether on a Distribution Date, a
Redemption Date or on the related Final Scheduled Distribution Date, as the case
may be) and the Redemption Price for any Note called for redemption pursuant to
Section 10.01 shall be payable only upon presentation and surrender of such Note
as provided below. Any funds represented by any such checks returned undelivered
shall be held in accordance with Section 3.03.
(b) The principal of each Note shall be payable on each Distribution
Date to the extent provided in the form of the related Note set forth as an
Exhibit hereto. Notwithstanding the foregoing, the entire unpaid principal
amount of the Notes of a Class of Notes shall be due and payable, if not
previously paid, on the earlier of :
(i) the Final Scheduled Distribution Date of such Class of
Notes;
(ii) the Redemption Date;
(iii) if an Event of Default shall have occurred and be
continuing, so long as an Insurer Default shall not have occurred and be
continuing, the date on which the Insurer shall have declared the Notes to
be immediately due and payable in the manner provided in Section 5.02; or
(iv) if an Event of Default shall have occurred and be
continuing, and an Insurer Default has occurred and is continuing, the date
on which the Holders of Notes representing not less than 662/3% of the
Outstanding Principal Amount have declared the Notes to be immediately due
and payable in the manner provided in Section 5.02.
All principal payments on each Class of Notes shall be made pro rata to the
--- ----
Noteholders of such Class entitled thereto. The Indenture 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 shall be mailed within five Business Days
14
of such Distribution Date (or, in the case of Notes registered in the name of
Cede & Co., as nominee of DTC, such notice shall be provided within one Business
Day of such Distribution Date) or receipt of notice of termination of the Trust
pursuant to Section 9.01(c) of the Owner Trust Agreement and shall specify that
such final installment will be payable only upon presentation and surrender of
such Note at the offices or agency maintained for that purpose pursuant to
Section 3.02 and any other office or agency as the Indenture Trustee shall
specify. Notices in connection with redemptions of Notes shall be mailed to
Noteholders as provided in Section 10.02.
(c) Promptly following the date on which all principal of and
interest on the Notes has been paid in full and the Notes have been surrendered
to the Indenture Trustee, the Indenture Trustee shall, if the Insurer has paid
any amount in respect of the Notes under the Insurance Policy that has not been
reimbursed to the Insurer, deliver such surrendered Notes to the Insurer.
SECTION 2.08. Cancellation. All Notes surrendered for payment,
------------
registration of transfer, exchange or redemption, if surrendered to any Person
other than the Indenture Trustee, shall be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever, and all Notes so delivered shall be promptly cancelled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes cancelled as provided in this Section, except as expressly permitted
by this Indenture. All cancelled Notes may be held or disposed of by the
Indenture Trustee in accordance with its standard retention or disposal policy
as in effect at the time unless the Issuer shall direct by an Issuer Order that
they be destroyed or returned to it; provided that such Issuer Order is timely
--------
and the Notes have not been previously disposed of by the Indenture Trustee.
SECTION 2.09. Book-Entry Notes. The Notes, upon original issuance,
----------------
will be issued in the form of a typewritten Note or Notes representing the Book-
Entry Notes, to be delivered to DTC, the initial Clearing Agency, by or on
behalf of the Issuer. Such Notes initially shall 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 2.11. Unless and until
definitive, fully registered Notes (the "Definitive Notes") have been issued to
----------------
Note Owners pursuant to Section 2.11:
(i) the provisions of this Section 2.09 shall be in full force and
effect;
(ii) the Note Registrar and the Indenture Trustee shall be entitled
to deal with the Clearing Agency for all purposes of this Indenture
(including the payment of principal of and interest on the Notes and the
giving of instructions or directions hereunder) as the sole holder of the
Notes, and shall have no obligation to the Note Owners;
15
(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. Pursuant to the Depository Agreement, unless
and until Definitive Notes are issued pursuant to Section 2.11, the
Clearing Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit payments of principal of and interest
on the Notes to such Clearing Agency Participants; and
(v) whenever this Indenture requires or permits actions to be taken
based upon instructions or directions of Holders of Notes evidencing a
specified percentage of the Outstanding Principal Amount, the Clearing
Agency shall be deemed to represent such percentage only to the extent that
it has received instructions to such effect from Note Owners and/or
Clearing Agency Participants owning or representing, respectively, such
required percentage of the beneficial interest in the Notes and has
delivered such instructions to the Indenture Trustee.
SECTION 2.10. Notices to Clearing Agency. Whenever a notice or other
--------------------------
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to Note Owners pursuant to Section
2.11, the Indenture Trustee shall give all such notices and communications
specified herein to be given to Holders of the Notes to the Clearing Agency, and
shall have no obligation to the Note Owners.
SECTION 2.11. Definitive Notes. If (i) the Administrator advises the
----------------
Indenture Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities as described in the Depository
Agreement, and the Administrator or the Indenture Trustee is unable to locate a
qualified successor, or (ii) after the occurrence of an Event of Default or a
Servicer Default, Note Owners representing in the aggregate more than 50% of the
Outstanding Principal Amount of all Classes of Notes advise the Indenture
Trustee through the Clearing Agency Participants in writing that the
continuation of a book-entry system through the Clearing Agency is no longer in
the best interests of the related Note Owners, then the Indenture Trustee shall
notify all Note Owners, through the Clearing Agency, of the availability of
Definitive Notes to Note Owners requesting the same. Upon surrender to the
Indenture Trustee of the Note or Notes evidencing the Book Entry Notes by the
Clearing Agency, accompanied by registration instructions from the Clearing
Agency, the Issuer shall execute and the Indenture Trustee shall authenticate
the Definitive Notes and deliver such Definitive Notes in accordance with the
instructions of the Clearing Agency. None of the Issuer, the Note Registrar or
the Indenture Trustee shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be protected in relying on,
such instructions. Upon the issuance of Definitive Notes of a Class, the
Indenture Trustee shall recognize the Holders of the Definitive Notes as
Noteholders hereunder.
16
The Indenture Trustee shall not be liable if the Indenture Trustee or
the Administrator is unable to locate a qualified successor Clearing Agency. The
Definitive Notes shall be typewritten, printed, mimeographed, 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.
SECTION 2.12. Release of Collateral. Subject to Section 11.01 and
---------------------
except as otherwise provided by the terms of the Basic Documents, the Indenture
Trustee shall release property from the lien of this Indenture only upon receipt
of an Issuer Request accompanied by an Officer's Certificate, an Opinion of
Counsel (not at the expense of the Indenture Trustee) and Independent
Certificates in accordance with Sections 314(c) and 314(d)(1) of the TIA or an
Opinion of Counsel in lieu of such Independent Certificates to the effect that
the TIA does not require any such Independent Certificates. The Indenture
Trustee shall surrender the Insurance Policy to the Insurer for cancellation
upon satisfaction of the conditions in Section 4.01 hereof.
SECTION 2.13. Tax Treatment. The Issuer has entered into this
-------------
Indenture, and the Notes will be issued, with the intention that, for federal,
state and local income, single business and franchise tax purposes, the Notes
will qualify as indebtedness. Each of the Issuer and the Indenture Trustee, by
entering into this Indenture, and each Noteholder, by its acceptance of its Note
(and each Note Owner by its acceptance of an interest in the applicable Book-
Entry Note), agree to treat the Notes for federal, state and local income,
single business and franchise tax purposes as indebtedness.
SECTION 2.14. ERISA. Each purchaser or transferee of a Note that is
-----
a Benefit Plan shall be deemed to have represented that the relevant conditions
for exemptive relief under Prohibited Transaction Class Exemption ("PTCE") 84-
----
14, ▇▇▇▇ ▇▇-▇, ▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ 95-60 or PTCE 96-23 or other applicable
exemption providing substantially similar relief have been satisfied.
SECTION 2.15. CUSIP Numbers. The Issuer in issuing the Notes may use
-------------
"CUSIP numbers" (if they are generally in use), and, if so, the Indenture
-------------
Trustee shall use CUSIP numbers in notices of redemption as a convenience to
Noteholders; provided that any such notice may state that no representation is
--------
made as to the correctness of such numbers either as printed on the Notes or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Notes, and any such redemption
shall not be affected by any defect in or omission of such numbers. The Issuer
will promptly notify the Indenture Trustee of any change in the CUSIP numbers.
SECTION 2.16. Issuer's Obligations Absolute. Nothing contained in
-----------------------------
this Indenture shall impair, as between the Issuer and the Indenture Trustee,
the obligation of the Issuer to pay to the Indenture Trustee all amounts payable
in respect of the Notes as and when the same shall become due and payable in
accordance with the terms hereof, or prevent the Indenture Trustee from
exercising all rights, powers and
17
remedies otherwise permitted by this Indenture and by applicable law upon an
Event of Default under this Indenture.
SECTION 2.17. Authenticating Agent. (a) The Indenture Trustee may
--------------------
appoint one or more authenticating agents with respect to the Notes which shall
be authorized to act on behalf of the Indenture Trustee in authenticating the
Notes in connection with the issuance, delivery, registration of transfer,
exchange or repayment of the Notes. Whenever reference is made in this Agreement
to the authentication of Notes by the Indenture Trustee or the Indenture
Trustee's certificate of authentication, such reference shall be deemed to
include authentication on behalf of the Indenture Trustee by an authenticating
agent and a certificate of authentication executed on behalf of the Indenture
Trustee by an authenticating agent. Each authenticating agent must be acceptable
to the Seller and the Insurer.
(b) Any institution succeeding to the corporate agency business of an
authenticating agent shall continue to be an authenticating agent without the
execution or filing of any paper or any further act on the part of the Indenture
Trustee or such authenticating agent.
(c) An authenticating agent may at any time resign by giving written
notice of resignation to the Indenture Trustee, the Insurer and the Seller. The
Indenture Trustee may at any time terminate the agency of an authenticating
agent by giving notice of termination to such authenticating agent, the Insurer
and the Seller. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time an authenticating agent shall cease to be
acceptable to the Indenture Trustee or the Seller, the Indenture Trustee
promptly may appoint a successor authenticating agent. Any successor
authenticating agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an authenticating agent. No successor
authenticating agent shall be appointed unless acceptable to the Indenture
Trustee, the Insurer and the Seller.
18
ARTICLE III
COVENANTS
SECTION 3.01. Payment of Principal and Interest. The Issuer will
---------------------------------
duly and punctually pay the principal of and interest, if any, on the Notes in
accordance with the terms of the Notes and this Indenture. Without limiting the
foregoing, subject to Section 8.02(c), the Issuer will cause to be distributed
all amounts on deposit in the Note Distribution Account on a Distribution Date
deposited therein pursuant to the Sale and Servicing Agreement for the benefit
of (i) the Class A-1 Notes, to the Class A-1 Noteholders, (ii) the Class A-2
Notes, to the Class A-2 Noteholders, (iii) the Class A-3 Notes, to the Class A-3
Noteholders and (iv) the Class A-4 Notes, to the Class A-4 Noteholders. 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 3.02. Maintenance of Office or Agency. The Issuer will
-------------------------------
maintain or will cause the Administrator or the Indenture Trustee to maintain in
the City of New York, an office or agency where Notes may be surrendered for
registration of transfer or exchange, and where notices and demands to or upon
the Issuer in respect of the Notes and this Indenture may be served. The Issuer
hereby initially appoints the Indenture Trustee to serve as its agent for the
foregoing purposes. The Issuer will give prompt written notice to the Indenture
Trustee of the location, and of any change in the location, of any such office
or agency. If at any time the Issuer shall fail to maintain any such office or
agency or shall fail to furnish the Indenture Trustee with the address thereof,
such surrenders, notices and demands may be made or served at the Corporate
Trust Office, and the Issuer hereby appoints the Indenture Trustee as its agent
to receive all such surrenders, notices and demands.
SECTION 3.03. Money for Payments to be Held in Trust.
--------------------------------------
(a) As provided in Section 8.02, all payments of amounts due and
payable with respect to any Notes that are to be made from amounts withdrawn
from the Collection Account, the Payment Account and the Note Distribution
Account shall be made on behalf of the Issuer by the Indenture Trustee or by
another Paying Agent, and no amounts so withdrawn from the Collection Account,
the Payment Account and the Note Distribution Account for payments of Notes
shall be paid over to the Issuer except as provided in this Section 3.03.
The Notes shall be non-recourse obligations of the Issuer and shall be
limited in right of payment to amounts available from the Collateral and the
Insurance Policy as provided in this Indenture and the Issuer shall not
otherwise be liable for payments on the Notes. No Person shall be personally
liable for any amounts payable under the Notes. If any other provision of this
Indenture conflicts or is deemed to conflict with the provisions of this
paragraph, the provisions of this paragraph shall control.
19
The Issuer will cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee and the Insurer (so long
as the Insurer is the Controlling Party) an instrument in which such Paying
Agent shall agree with the Indenture Trustee (and if the Indenture Trustee acts
as Paying Agent, it hereby so agrees), subject to the provisions of this
Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due
with respect to the Notes in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and pay such sums to such Persons as herein provided;
(ii) give the Indenture Trustee and the Insurer notice of any
default by the Issuer (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 Indenture Trustee, forthwith pay to the
Indenture Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as Paying Agent and forthwith pay to
the Indenture Trustee all sums held by it in trust for the payment of Notes
if at any time it ceases to meet the standards required to be met by a
Paying Agent at the time of its appointment; and
(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 or for any other purpose, by Issuer Order direct any
Paying Agent to pay to the Indenture Trustee all sums held in trust by such
Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts
as those upon which the sums were held by such Paying Agent; and upon such
payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds, any money
held by the Indenture Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Note and remaining unclaimed for two years
after such amount has become due and payable shall be discharged from such trust
and be paid either (i) to the Issuer upon receipt of an Issuer Request and with
the consent of the Insurer or (ii) to the Insurer to the extent such money or
any portion thereof was paid by the Insurer to the Indenture Trustee; and the
Holder of such Note shall thereafter, as an unsecured general creditor, look
only to the Issuer for payment thereof (but only to the extent of the amounts so
paid to the Issuer), and all liability of the Indenture Trustee, the Insurer or
such Paying Agent with respect to such trust money shall thereupon cease;
provided that
--------
20
the Indenture Trustee or such Paying Agent, before being required to make any
such repayment, shall at the expense and direction of the Issuer cause to be
published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in The City of New
York, notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to or for the
account of the Issuer or the Insurer, as applicable. The Indenture Trustee may
also adopt and employ, at the expense of the Issuer, any other reasonable means
of notification of such repayment (including, but not limited to, mailing notice
of such repayment to Holders whose Notes have been called but have not been
surrendered for redemption or whose right to or interest in monies due and
payable but not claimed is determinable from the records of the Indenture
Trustee or of any Paying Agent, at the last address of record for each such
Holder).
SECTION 3.04. Existence. The Issuer will keep in full effect its
---------
existence, rights and franchises as a business trust under the laws of the State
of Delaware (unless, subject to the prior written consent of the Insurer, it
becomes, or any successor Issuer hereunder is or becomes, organized under the
laws of any other State, in which case the Issuer will keep in full effect its
existence, rights and franchises under the laws of such other jurisdiction) and
will obtain and preserve its qualification to do business in each jurisdiction
in which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, and the Collateral and each other
instrument included in the Collateral.
SECTION 3.05. Protection of Collateral. The Issuer intends the
------------------------
security interest Granted pursuant to this Indenture in favor of the Indenture
Trustee on behalf of the Noteholders and the Insurer to be prior to all other
liens in respect of the Collateral, and the Issuer shall take all actions
necessary to obtain and maintain, for the benefit of the Indenture Trustee on
behalf of the Noteholders and the Insurer, a first lien on and a first priority,
perfected security interest in, the Collateral. The Issuer will from time to
time take all actions necessary, including without limitation preparing,
executing, delivering and filing all such supplements and amendments hereto and
all such financing statements, continuation statements, instruments of further
assurance and other instruments, if applicable, all as prepared by the Servicer
and delivered to the Issuer, and will take such other action necessary or
advisable to:
(i) Grant more effectively all or any portion of the
Collateral;
(ii) maintain or preserve the lien and security interest (and
the priority thereof) created by this Indenture or carry out more
effectively the purposes hereof;
(iii) perfect, publish notice of or protect the validity of any
Grant made or to be made by this Indenture;
(iv) enforce any of the Collateral;
21
(v) preserve and defend title to the Collateral and the rights
of the Indenture Trustee, the Insurer and the Noteholders in such
Collateral against the claims of all persons and parties; or
(vi) pay all taxes or assessments levied or assessed upon the
Collateral when due.
The Issuer hereby designates the Indenture Trustee its agent and attorney-in-
fact to execute all financing statements, continuation statements or other
instruments required to be executed pursuant to this Section.
SECTION 3.06. Opinions as to Collateral.
-------------------------
(a) On the Closing Date, the Issuer shall furnish to the Indenture
Trustee and the Insurer an Opinion of Counsel to the effect that, in the opinion
of such counsel, either (i) all financing statements and continuation statements
have been executed and filed that are necessary to create and continue the
Indenture Trustee's first priority perfected security interest in the Collateral
for the benefit of the Noteholders and the Insurer, and reciting the details of
such filings or referring to prior Opinions of Counsel in which such details are
given, or (ii) no such action shall be necessary to perfect such security
interest.
(b) Within 90 days after the beginning of each calendar year
beginning with the first calendar year beginning more than three months after
the Cut-Off Date, the Issuer shall furnish to the Indenture Trustee and the
Insurer an Opinion of Counsel (which may be the same Opinion of Counsel
delivered pursuant to Section 9.02(i) of the Sale and Servicing Agreement),
dated as of a date during such 90-day period, to the effect that, in the opinion
of such counsel, either (i) all financing statements and continuation statements
have been executed and filed that are necessary to create and continue the
Indenture Trustee's first priority perfected security interest in the Collateral
for the benefit of the Noteholders and the Insurer, and reciting the details of
such filings or referring to prior Opinions of Counsel in which such details are
given, or (ii) no such action shall be necessary to perfect such security
interest. Such Opinion of Counsel shall also describe the recording, filing, re-
recording and refiling of this Indenture, any indentures supplemental hereto and
any other requisite documents and the execution and filing of any financing
statements and continuation statements that will, in the opinion of such
counsel, be required to maintain the lien and security interest of this
Indenture until December 31 in the following calendar year.
SECTION 3.07. Performance of Obligations; Servicing of Contracts.
--------------------------------------------------
(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 Collateral or that would result in the amendment,
hypothecation, subordination, termination or discharge of, or impair the
validity or effectiveness of, any such
22
instrument or agreement, except as expressly provided in this Indenture, the
other Basic Documents or such other instrument or agreement.
(b) The Issuer may contract with or otherwise obtain the assistance
of other Persons acceptable to the Insurer so long as the Insurer is the
Controlling Party to assist it in performing its duties and obligations under
this Indenture, and any performance of such duties by a Person identified to the
Indenture Trustee and the Insurer in an Officer's Certificate shall be deemed to
be action taken by the Issuer. Initially, the Issuer has contracted with the
Servicer and the Administrator to assist the Issuer in performing its duties
under this Indenture. The Indenture Trustee shall not be responsible for the
action or inaction of the Servicer or the Administrator.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the other Basic
Documents and in the instruments and agreements included in the Collateral,
including but not limited to filing or causing to be filed all UCC financing
statements and continuation statements required to be filed by the terms of this
Indenture and the Sale and Servicing Agreement in accordance with and within the
time periods provided for herein and therein.
(d) If the Issuer shall have actual knowledge of the occurrence of a
Servicer Default, the Issuer shall promptly notify the Indenture Trustee, the
Insurer and each Rating Agency thereof, and shall specify in such notice the
action, if any, the Issuer is taking with respect of such default. If a Servicer
Default shall arise from the failure of the Servicer to perform any of its
duties or obligations under the Sale and Servicing Agreement with respect to the
Contracts, the Issuer shall take all reasonable steps available to it to remedy
such failure.
(e) Without limiting the absolute nature of the assignment granted to
the Indenture Trustee under this Indenture or the rights of the Indenture
Trustee hereunder, the Issuer agrees (i) that it will not, without the prior
written consent of the Insurer and, so long as an Insurer Default has occurred
and is continuing, either the Indenture Trustee or the Holders of not less than
a majority in Outstanding Principal Amount of the Notes, amend, modify, waive,
supplement, terminate or surrender, or agree to any amendment, modification,
supplement, termination, waiver or surrender of, the terms of any Collateral
(except to the extent permitted pursuant to the Sale and Servicing Agreement) or
waive timely performance or observance by the Servicer or the Seller under the
Sale and Servicing Agreement or any of the other Basic Documents, and (ii) that
any such amendment shall not without the consent of each Noteholder (A) increase
or reduce in any manner the amount of, or accelerate or delay the timing of,
collections of payments on the related Contracts or distributions that are
required to be made for the benefit of the Noteholders, (B) reduce the aforesaid
percentage of the Notes that is required to consent to any such amendment or (C)
result in a taxable event to any of the Noteholders for federal income tax
purposes or result in the Trust being classified as an association or publicly
traded partnership taxable as a corporation for federal income tax purposes. If
the Insurer and, as applicable, the Indenture Trustee or such Holders agree to
any such amendment, modification, supplement or waiver, the Issuer agrees,
promptly following a request by the Indenture Trustee or the Insurer to do so,
to
23
execute and deliver, in its own name and at its own expense, such agreements,
instruments, consents and other documents as the Indenture Trustee or the
Insurer may deem necessary or appropriate in the circumstances.
SECTION 3.08. Negative Covenants. Until the Termination Date, the
------------------
Issuer shall not:
(i) except as expressly permitted by this Indenture or the
other Basic Documents, sell, transfer, exchange or otherwise dispose of any
of the properties or assets of the Issuer, including those included in the
Collateral, unless directed to do so by the Indenture Trustee and with the
prior written consent of the Insurer;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of the Notes (other than amounts
properly withheld from such payments under the Code or applicable state
law) or assert any claim against any present or former Noteholder by reason
of the payment of the taxes levied or assessed upon the Trust or any of its
assets;
(iii) (A) permit the validity or effectiveness of this Indenture
to be impaired, or permit the lien created by this Indenture to be amended,
hypothecated, subordinated, terminated or discharged, or permit any Person
to be released from any covenants or obligations with respect to the Notes
under this Indenture except as may be expressly permitted hereby, (B)
permit any lien, charge, excise, claim, security interest, mortgage or
other encumbrance (other than the lien of this Indenture) to be created on
or extend to or otherwise arise upon or burden the Collateral or any part
thereof or any interest therein or the proceeds thereof (other than tax
liens, mechanics' liens and other liens that arise by operation of law, in
each case on a Financed Vehicle and arising solely as a result of an action
or omission of the related Obligor), or (C) permit the lien created by this
Indenture not to constitute a valid first priority (other than with respect
to any such tax, mechanics' or other lien) security interest in the
Collateral; or
(iv) voluntarily dissolve or liquidate in whole or in part.
SECTION 3.09. Annual Statement as to Compliance. The Issuer will
---------------------------------
deliver to the Indenture Trustee and the Insurer, on or before 120 days after
the end of each fiscal year of the Issuer (commencing with the fiscal year ended
________ ,_______ ), 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
24
this Indenture throughout such year, or, if there has been a default in the
compliance of any such condition or covenant, specifying each such default
known to such Authorized Officer and the nature and status thereof.
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 (A) shall be a Person organized and
existing under the laws of the United States of America or any State or the
District of Columbia, (B) shall not be an "investment company" as defined
in the Investment Company Act and (C) shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture
Trustee and the Insurer, in form and substance satisfactory to the
Indenture Trustee and the Insurer, the due and punctual payment of the
principal of and interest on all Notes and the performance or observance of
every agreement and covenant of this Indenture and each other Basic
Document on the part of the Issuer to be performed or observed, all as
provided herein;
(ii) immediately after giving effect to such consolidation or
merger, no Default or Event of Default shall have occurred and be
continuing;
(iii) the Rating Agency Condition shall have been satisfied with
respect to such consolidation or merger;
(iv) the Issuer shall have received an Opinion of Counsel which
shall be delivered to and shall be satisfactory to the Indenture Trustee
and the Insurer to the effect that such consolidation or merger will not
have any material adverse tax consequence to the Trust or any Noteholder;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture shall have been taken;
(vi) the Issuer shall have delivered to the Indenture Trustee
and the Insurer an Officer's Certificate and an Opinion of Counsel (which
shall describe the actions taken as required by clause (v) above or that no
such actions will be taken) each stating that such consolidation or merger
and such supplemental indenture comply with this Article III and that all
conditions precedent herein provided for relating to such transaction have
been compiled with (including any filings required by the Exchange Act);
and
(vii) the Issuer shall have given the Insurer written notice of
such consolidation or merger at least 20 Business Days prior to the
consummation of such action and, so long as the Insurer is the Controlling
Party, shall have received the prior written approval of the Insurer of
such consolidation or merger and the Issuer or the Person (if other than
the Issuer) formed by or surviving such
25
consolidation or merger has a net worth, immediately after such
consolidation or merger, that is (A) greater than zero and (B) not less
than the net worth of the Issuer immediately prior to giving effect to such
consolidation or merger.
(b) The Issuer shall not convey or transfer all or substantially all
of its properties or assets, including those included in the Collateral, to any
Person (except to the Indenture Trustee as expressly permitted by the Basic
Documents), unless:
(i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer shall (A) be a United States citizen or
a Person organized and existing under the laws of the United States or any
State or the District of Columbia, (B) not be an "investment company" as
defined in the Investment Company Act, (C) expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture
Trustee and the Insurer, in form and substance satisfactory to the
Indenture Trustee and the Insurer (so long as the Insurer is the
Controlling Party), the due and punctual payment of the principal of and
interest on all Notes and the performance or observance of every agreement
and covenant of this Indenture and each other Basic Document on the part of
the Issuer to be performed or observed, all as provided herein, (D)
expressly agree by means of such supplemental indenture that all right,
title and interest so conveyed or transferred shall be subject and
subordinate to the rights of Holders of the Notes and the Insurer, (E)
unless otherwise provided in such supplemental indenture, expressly agree
to indemnify, defend and hold harmless the Issuer, the Insurer and the
Indenture Trustee against and from any loss, liability or expense arising
under or related to this Indenture and the Notes and (F) expressly agree by
means of such supplemental indenture that such Person (or if a group of
Persons, then one specified Person) shall make all filings with the
Commission (and any other appropriate Person) required by the Exchange Act
in connection with the Notes;
(ii) immediately after giving effect to such conveyance or
transfer, no Default or Event of Default shall have occurred and be
continuing;
(iii) the Rating Agency Condition shall have been satisfied with
respect to such conveyance or transfer;
(iv) the Issuer shall have received an Opinion of Counsel which
shall be delivered to and shall be satisfactory to the Indenture Trustee
and the Insurer to the effect that such conveyance or transfer will not
have any material adverse tax consequence to the Trust or any Noteholder;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture shall have been taken;
(vi) the Issuer shall have delivered to the Indenture Trustee
and the Insurer an Officer's Certificate and an Opinion of Counsel (which
shall describe the actions taken as required by clause (v) above or that no
such actions
26
will be taken) each stating that such conveyance or transfer and such
supplemental indenture comply with this Article III and that all conditions
precedent herein provided for relating to such transaction have been
complied with (including any filings required by the Exchange Act); and
(vii) so long as no Insurer Default shall have occurred and be
continuing, the Issuer shall have given the Insurer written notice of such
conveyance or transfer of properties or assets at least 20 Business Days
prior to the consummation of such action and shall have received the prior
written approval of the Insurer of such conveyance or transfer and the
Person acquiring by conveyance or transfer the properties or assets of the
Issuer has a net worth, immediately after such conveyance or transfer, that
is (A) greater than zero and (B) not less than the net worth of the Issuer
immediately prior to giving effect to such conveyance or transfer.
SECTION 3.11. Successor Transferee.
--------------------
(a) Upon any consolidation or merger of the Issuer in accordance with
Section 3.10(a), the Person formed by or surviving such consolidation or merger
(if other than the Issuer) shall succeed to, and be substituted for, and may
exercise every right and power of, the Issuer under this Indenture with the same
effect as if such Person had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets or properties of
the Issuer pursuant to Section 3.10(b), ANRC Auto Owner Trust _____ will be
released from every covenant and agreement of this Indenture to be observed or
performed on the part of the Issuer with respect to the Notes immediately upon
the delivery of written notice to the Indenture Trustee and the Insurer stating
that the Issuer is to be so released.
SECTION 3.12. No Other Business. The Issuer shall not engage in any
-----------------
business other than financing, purchasing, owning, selling and managing the
Contracts in the manner contemplated by this Indenture and the other Basic
Documents and activities incidental thereto.
SECTION 3.13. Servicer's Obligations. The Issuer shall cause the
----------------------
Servicer to comply with the Servicer's obligations under the Sale and Servicing
Agreement.
SECTION 3.14. Restricted Payments. The Issuer shall not, directly or
-------------------
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Depositor 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 Servicer, (ii) redeem, purchase, retire or otherwise
acquire for value any such ownership or equity interest or security or (iii) set
aside or otherwise segregate any amounts for any such purpose; provided that the
--------
Issuer may make, or cause to be made, distributions to the Servicer, the
Depositor, the Indenture Trustee, the Owner Trustee, the Insurer and the
27
Noteholders as contemplated by, and to the extent funds are available for such
purpose under, the Sale and Servicing Agreement, this Indenture or the Owner
Trust Agreement. The Issuer will not, directly or indirectly, make payments to
or distributions from the Collection Account, the Payment Account, the Note
Distribution Account or the Spread Account except in accordance with this
Indenture and the other Basic Documents.
SECTION 3.15. Notice of Events of Default. The Issuer agrees to give
---------------------------
the Indenture Trustee, the Owner Trustee, the Insurer and each Rating Agency
prompt written notice of each Event of Default hereunder and each default on the
part of the Servicer or the Seller of their respective obligations under the
Sale and Servicing Agreement.
The Issuer shall deliver to the Indenture Trustee and the Insurer,
within three days after obtaining knowledge of the occurrence thereof, written
notice in the form of an Officer's Certificate of any Default, its status and
what action the Issuer is taking or proposes to take with respect thereto.
SECTION 3.16. Further Instruments and Acts. Upon request of the
----------------------------
Indenture Trustee or the Insurer (so long as the Insurer is the Controlling
Party), 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 3.17. No Borrowing. The Issuer shall not issue, incur, assume,
------------
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes.
SECTION 3.18. Compliance with Laws. The Issuer shall comply with the
--------------------
requirements of all applicable laws, the non-compliance with which would,
individually or in the aggregate, materially and adversely affect the ability of
the Issuer to perform its obligations under the Notes, this Indenture or any
other Basic Document or have a material adverse effect on the Insurer, the
Noteholders, the Issuer or the Collateral.
SECTION 3.19. Amendments of Sale and Servicing Agreement and Owner
----------------------------------------------------
Trust Agreement. The Issuer shall not agree to any amendment to Section 9.01 of
---------------
the Sale and Servicing Agreement or Section 11.01 of the Owner Trust Agreement
to eliminate the requirements thereunder that the Holders of the Notes consent
to amendments thereto as provided therein.
SECTION 3.20. Maintenance of Books and Records. The Issuer shall
--------------------------------
maintain and implement, or shall cause to be maintained or implemented,
administrative and operating procedures reasonably necessary for the performance
of its obligations hereunder and the Issuer shall keep and maintain at all
times, or cause to be kept or maintained at all times in its office in The City
of New York, or the office of one of its agents in The City of New York, all
documents, books, records, accounts and other information reasonably necessary
or advisable for the performance of its obligations hereunder.
28
SECTION 3.21. Guarantees, Loans, Advances and Other Liabilities.
-------------------------------------------------
Except as contemplated by the Sale and Servicing Agreement, the Owner Trust
Agreement or this Indenture, 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 payment or performance on any obligation or
capability of so doing or otherwise), endorse or otherwise become contingently
liable, directly or indirectly, in connection with the obligations, stocks or
dividends of, or own, purchase, repurchase or acquire (or agree contingently to
do so) any stock, obligations, assets or securities of, or any other interest
in, or make any capital contribution to, any other Person.
SECTION 3.22. Capital Expenditures. The Issuer shall not make any
--------------------
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
SECTION 3.23. Removal of Administrator. So long as any Notes are
------------------------
Outstanding, the Issuer shall not remove the Administrator unless the Rating
Agency Condition shall have been satisfied in connection with such removal and
the Indenture Trustee receives written notice of the foregoing and the Insurer
and the Indenture Trustee shall have given their prior written consent.
29
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.01. Satisfaction and Discharge of Indenture. This Indenture
---------------------------------------
shall cease to be of further effect with respect to the Notes (except as to (i)
rights of registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments
of principal thereof and interest thereon (including any such right of the
Insurer pursuant to Section 2.07(c), Section 4.04 or the definition of
"Outstanding"), (iv) Sections 3.03, 3.04, 3.05, 3.07, 3.08, 3.10, 3.11, 3.12,
3.14, 3.17, 3.18, 3.20, 3.21, 3.22, 3.23 and 6.06, (v) the rights, obligations
and immunities of the Indenture Trustee hereunder (including the rights of the
Indenture Trustee under Section 6.07 and the obligations of the Indenture
Trustee under Section 4.02), (vi) the rights of Noteholders as beneficiaries
hereof with respect to the property so deposited with the Indenture Trustee
payable to all or any of them and (vii) the obligation of the Indenture Trustee
to make claims under the Insurance Policy, which shall survive the Final
Scheduled Distribution Date of the Class A-4 Notes and extend through any
preference period applicable with respect to the Notes or any payments made in
respect of the Notes), and the Indenture Trustee, on demand of and at the
expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to the Notes, when:
(A) either:
(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 2.05 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 3.03) have been
delivered to the Indenture Trustee for cancellation and the Insurance
Policy has been returned to the Insurer for cancellation; or
(2) all Notes not theretofore delivered to the Indenture Trustee
for cancellation:
(i) have become due and payable,
(ii) will become due and payable at the Final Scheduled
Distribution Date of the Class A-4 Notes within one
year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Indenture Trustee
for the giving of notice of redemption by the
Indenture Trustee in the name, and at the expense, of
the Issuer,
30
and the Issuer, in the case of clauses (i), (ii) or (iii) above, has irrevocably
deposited or caused to be irrevocably deposited with the Indenture Trustee cash
or direct obligations of or obligations guaranteed by the United States of
America (which will mature prior to the date such amounts are payable), in trust
in an Eligible Account for such purpose, in an amount sufficient to pay and
discharge the entire indebtedness on such Notes not theretofore delivered to the
Indenture Trustee for cancellation when due on the Final Scheduled Distribution
Date of the Class A-4 Notes or Redemption Date (if Notes shall have been called
for redemption pursuant to Section 10.01), as the case may be;
(B) the Issuer has paid or performed or caused to be paid or
performed all amounts and obligations which the Issuer may owe to or on behalf
of (1) the Indenture Trustee on behalf of itself and for the benefit of the
Noteholders under this Indenture, the Basic Documents or the Notes and (2) the
Insurer under this Indenture and the Basic Documents, and as subrogee of the
rights of the Holders of the Notes; and
(C) the Issuer has delivered to the Indenture Trustee and the Insurer
an Officer's Certificate, an Opinion of Counsel and (if required by the TIA, of
the Indenture Trustee) an Independent Certificate from a firm of certified
public accountants, each meeting the applicable requirements of Section 11.01(a)
and, subject to Section 11.02, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with and the Rating Agency Condition has been satisfied.
SECTION 4.02. Application of Trust Money. All monies deposited with
--------------------------
the Indenture Trustee pursuant to Section 4.01 shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Insurer and the Holders of the
particular Notes for the payment or redemption of which such monies have been
deposited with the Indenture Trustee, of all sums due and to become due thereon
for principal and interest; provided such monies need not be segregated from
--------
other funds except to the extent required herein or in the Sale and Servicing
Agreement or required by law.
SECTION 4.03. Repayment of Monies Held by Paying Agent. In
----------------------------------------
connection with the satisfaction and discharge of this Indenture with respect to
the Notes, all monies then held by any Paying Agent other than the Indenture
Trustee under the provisions of this Indenture with respect to such Notes shall,
upon demand of the Issuer, be paid to the Indenture Trustee to be held and
applied according to Section 3.03 and thereupon such Paying Agent shall be
released from all further liability with respect to such monies.
SECTION 4.04. Effect of Payments by the Insurer; Subrogation.
----------------------------------------------
(a) Anything herein to the contrary notwithstanding, any distribution
of principal of or interest on the Notes that is made with moneys received
pursuant to the terms of the Insurance Policy shall not be considered payment of
the Notes by the Issuer and shall not discharge the Trust Estate in respect of
such distribution. The Indenture
31
Trustee acknowledges that, without the need for any further action on the part
of the Insurer, the Indenture Trustee or the Note Registrar, (i) to the extent
the Insurer makes payments, directly or indirectly, on account of principal of
or interest on the Notes to the Noteholders thereof, the Insurer will be fully
subrogated to the rights of such Noteholders to receive such principal and
interest from distributions of the assets of the Trust and will be deemed, to
the extent of the payments so made, to be a Noteholder and (ii) the Insurer
shall be paid principal and interest in its capacity as a Noteholder until all
such payments by the Insurer have been fully reimbursed, but only from the
sources and in the manner provided herein for the distribution of such principal
and interest and in each case only after the Noteholders have received all
payments of principal and interest due to them under this Agreement on the
related Distribution Date.
(b) Without limiting the rights or interests of the Noteholders as
otherwise set forth herein, so long as no Insurer Default exists or is
continuing, the Indenture Trustee shall cooperate in all respects with any
reasonable request by the Insurer for action to preserve or enforce the
Insurer's rights or interests under this Agreement, including, upon the
occurrence of an Event of Default or a Non-Servicer Default, a request to take
any one or more of the following actions:
(i) institute proceedings for the collection of all amounts
then payable on the Notes or under this Agreement, enforce any judgment
obtained and collect moneys adjudged due; and
(ii) any remedies of a secured party under the UCC and take any
other appropriate action to protect and enforce the rights and remedies of
the Insurer hereunder or under the other Basic Documents.
32
ARTICLE V
EVENTS OF DEFAULT; REMEDIES
SECTION 5.01. Events of Default. "Event of Default" shall mean any
----------------- ----------------
one of the following events (whatever the reason for such Event of Default and
whether it shall be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(a) the delivery to the Insurer of a claim for payment under the
Insurance Policy;
(b) default in the payment of the interest on any Note when the same
becomes due and payable, and such default shall continue for a period of five
days or more;
(c) default in the payment of any principal due and payable on the
applicable Final Scheduled Distribution Date for such Class of Notes;
(d) default in the observance or performance of any covenant or
agreement of the Issuer made in this Indenture (other than a covenant or
agreement, a default in the observance or performance of which is specifically
dealt with elsewhere in this Section 5.01), and such default shall continue or
not be cured for a period of 30 days after notice thereof shall have been given,
by registered or certified mail, to the Issuer by the Indenture Trustee or the
Insurer or to the Issuer, the Insurer and the Indenture Trustee by the Holders
of at least 25% of the Outstanding Principal Amount of the Notes, acting
together as a single class, in each case specifying such default and requiring
it to be remedied and stating that such notice is a notice of Default hereunder;
(e) any representation or warranty made by the Issuer in this
Indenture or in any certificate delivered pursuant hereto or in connection
herewith having been incorrect in a material respect as of the time made, and
such breach not having been cured within 30 days after notice thereof is given
to the Issuer by the Indenture Trustee or the Insurer, or to the Issuer, the
Insurer and the Indenture Trustee by the holders of at least 25% of the
Outstanding Principal Amount of the Notes acting together as a single class, in
each case specifying such breach and requiring it to be remedied and stating
that such notice is a notice of Default hereunder;
(f) the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of the Issuer or any substantial part of
the Collateral in an involuntary case under any applicable federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect, or
appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of the Issuer or for any substantial part of the Collateral, or
ordering the winding-up or liquidation of the Issuer's affairs;
33
(g) the commencement by the Issuer of a voluntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now or
hereafter in effect or the consent by the Issuer to the entry of an order for
relief in an involuntary case under any such law, or the consent by the Issuer
to the appointment or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Issuer or for any
substantial part of the Collateral, or the making by the Issuer of any general
assignment for the benefit of creditors, or the failure by the Issuer generally
to pay its debts as such debts become due, or the taking of action by the Issuer
in furtherance of any of the foregoing;
(h) the failure of the Indenture Trustee to have a valid perfected
first priority security interest in the Trust Property; or
(i) the failure of any of the Basic Documents to be in full force and
effect at any time;
provided that so long as no Insurer Default shall have occurred and be
--------
continuing, neither the Indenture Trustee nor the Noteholders may declare an
Indenture Event of Default under the Indenture. So long as an Insurer Default
shall not have occurred and be continuing, an Event of Default shall occur only
upon delivery by the Insurer to the Indenture Trustee of notice of the
occurrence of an Event of Default. The failure to pay principal on a Class of
Notes shall not result in the occurrence of an Event of Default until the Final
Scheduled Distribution Date for such Class of Notes.
SECTION 5.02. Rights Upon Event of Default.
----------------------------
(a) So long as no Insurer Default has occurred and is continuing, if
an Event of Default shall have occurred and be continuing, then the Insurer
shall have the right, but not the obligation, upon prior written notice to each
Rating Agency, to declare by written notice to the Issuer and the Indenture
Trustee that all, but not less than all of the Notes become immediately due and
payable, and upon any such declaration the unpaid principal amount of the Notes,
together with accrued and unpaid interest thereon, shall become immediately due
and payable. The failure to pay principal on a Class of Notes will not result in
the occurrence of an Event of Default until the Final Scheduled Distribution
Date for such Class of Notes. The Insurer may not, however, cause the Indenture
Trustee to liquidate the Collateral, in whole or in part, if the proceeds of
such liquidation would not be sufficient to pay the Outstanding Principal Amount
of each Class of Notes, together with accrued and unpaid interest thereon at the
respective Note Rates of each Class of Notes, unless the Event of Default arose
from a claim made on the Insurance Policy or from an Event of Default specified
in Section 5.01(f) or (g). The Indenture Trustee will have no discretion with
respect to the acceleration of the Notes under the foregoing circumstances. In
the event of any such acceleration of the Notes, the Indenture Trustee shall
continue to make claims under the Insurance Policy with respect to the Notes.
(b) If an Insurer Default shall have occurred and be continuing and
an Event of Default specified in Section 5.01(b), (c), (d), (e), (f), (g), (h)
or (i) shall have
34
occurred and be continuing, the Indenture Trustee may, and shall, if so
requested in writing by the Holders of Notes representing at least 66 2/3% of
the aggregate Outstanding Principal Amount of the Notes, declare that the Notes
become immediately due and payable, and upon any such declaration the unpaid
Outstanding Principal Amount of the Notes, together with accrued and unpaid
interest thereon, shall become immediately due and payable.
(c) Following any Event of Default, the Insurer, at its sole option,
may elect to pay all or any portion of the Outstanding Principal Amount of the
Notes, plus accrued and unpaid interest thereon to the date of payment.
(d) At any time after such declaration of acceleration of maturity
has been made and before a judgment or decree for payment of the money due has
been obtained by the Indenture Trustee as provided in this Article V, either the
Insurer (so long as an Insurer Default has not occurred and is continuing) or
the Holders of the Notes representing a majority of the Outstanding Principal
Amount of the Notes (if an Insurer Default has occurred and is continuing), by
written notice to the Issuer and the Indenture Trustee, may rescind and annul
such declaration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture Trustee
a sum sufficient to pay:
(A) all payments of principal of and interest on all Notes and all
other amounts that would then be due hereunder or upon such Notes if the Event
of Default giving rise to such acceleration had not occurred; and
(B) all sums advanced by the Insurer, together with interest thereon,
and remitted by the Indenture Trustee or the Insurer hereunder or by the Insurer
under the Insurance Policy, plus all amounts due to the Insurer under the Basic
----
Documents and the reasonable compensation, expenses, disbursements and advances
of the Indenture Trustee, the Owner Trustee and the Insurer and their respective
agents and counsel; and
(ii) All Events of Default have been cured or waived as provided
in Section 5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement
----------------------------------------------------
by Indenture Trustee.
--------------------
(a) The Issuer covenants that, if the Notes are accelerated in
accordance with Section 5.02, the Issuer, upon demand of the Indenture Trustee,
to the extent there are funds available in the Trust Accounts, will pay to the
Indenture Trustee, for the benefit of the Holders of the Notes, the whole amount
then due and payable on such Notes for principal and interest (including,
without limitation, the amounts due on account of the Notes being accelerated),
with interest upon the overdue principal and, to the extent payment at such rate
of interest shall be legally enforceable, upon overdue
35
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 and disbursements of
the Indenture Trustee and its agents and counsel.
(b) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee may, and shall (i) if no Insurer Default shall have occurred
and be continuing, at the direction of the Insurer, or (ii) if an Insurer
Default shall have occurred and be continuing, at the direction of the Holders
of Notes representing at least 66 2/3% of the Outstanding Principal Amount of
the Notes, as more particularly provided in Section 5.04, institute a Proceeding
for the collection of the amounts so due and unpaid, and shall prosecute such
Proceeding to judgment or final decree, and, at the direction of the Controlling
Party, shall enforce the same against the Issuer or other obligor upon such
Notes and collect in the manner provided by law out of the Collateral or the
property of the Issuer or other obligor upon such Notes, wherever situated, the
moneys adjudged or decreed payable. At any time when (i) the Insurer is the
Controlling Party or (ii)(A) the Insurer is the Holder of the Notes pursuant to
Section 2.07 or 4.04 hereof or Section 4.06 of the Sale and Servicing Agreement
and (B) all amounts due to all other Holders of the Notes pursuant to the Notes
and this Indenture have been paid in full, the Insurer may, in its own name,
institute any Proceeding or take any other action permitted under this section
to collect amounts due hereunder from the Issuer or any other obligor on the
Notes.
(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 Collateral, Proceedings under Title 11 of the United States Code
or any other applicable federal or state bankruptcy, insolvency or other similar
law, or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial Proceedings relative to the Issuer
or other obligor upon the Notes, or to the creditors or property of the Issuer
or such other obligor, the Indenture Trustee, irrespective of whether the
principal of any Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Indenture Trustee shall
have made any demand pursuant to the provisions of this Section 5.03, shall be
entitled and empowered (but only at the written direction of the Insurer so long
as it is the Controlling Party), by intervention in such Proceedings or
otherwise:
(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to file
such other papers or documents as may be necessary or advisable in order to
have the claims of the Indenture Trustee (including any claim for
reasonable compensation to the Indenture Trustee and each predecessor
Indenture Trustee, and their respective agents, attorneys and counsel, and
for reimbursement of all expenses and liabilities incurred by the Indenture
Trustee and each predecessor Indenture Trustee, except as a result of
negligence or bad faith) and of the Noteholders allowed in such
Proceedings;
36
(ii) unless prohibited by applicable law and regulations, to
vote on behalf of the Holders of Notes in any election of a trustee, a
standby trustee or Person performing similar functions in any such
Proceedings;
(iii) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders and of the Indenture
Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the
Indenture Trustee or the Holders of Notes 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 Indenture Trustee, and, in the event that the Indenture Trustee
shall consent to the making of payments directly to such Noteholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents, attorneys and counsel, and all other expenses and
liabilities incurred by the Indenture Trustee and each predecessor Indenture
Trustee except as a result of negligence or bad faith on the part of the
Indenture Trustee.
(d) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.
(e) All rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture Trustee
without the possession of any of the Notes or the production thereof in any
trial or other Proceedings relative thereto, and any such action or Proceedings
instituted by the Indenture Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment, subject to the payment of the
expenses, disbursements and compensation of the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents and attorneys, shall
be for the ratable benefit of the Holders of the Notes and the Insurer.
(f) In any Proceedings brought by the Indenture Trustee (including
any Proceedings involving the interpretation of any provision of this
Indenture), the Indenture Trustee shall be held to represent all the
Noteholders, and it shall not be necessary to make any Noteholder a party to any
such Proceedings.
37
SECTION 5.04. Remedies.
--------
(a) If (i) an Event of Default shall have occurred and be continuing,
the Indenture Trustee shall (subject to Section 5.04(b) and Section 5.05), if no
Insurer Default shall have occurred and be continuing, at the direction of the
Insurer, or (ii) if an Event of Default specified in Section 5.01 (b), (c), (d),
(e), (f), (g), (h) or (i) shall have occurred and be continuing, the Indenture
Trustee shall (subject to Section 5.04(b) and Section 5.05), if an Insurer
Default shall have occurred and be continuing, at the direction of the Holders
of Notes representing at least 66 2/3% of the Outstanding Principal Amount of
the Notes, take one or more of the following actions as so directed:
(i) institute Proceedings in its own name and as or on behalf
of a trustee of an express trust for the collection of all amounts then
payable on the Notes or under this Indenture with respect thereto, whether
by declaration or otherwise, enforce any judgment obtained and collect from
the Issuer and any other obligor upon such Notes monies adjudged due;
(ii) institute Proceedings from time to time for the complete
or partial foreclosure of this Indenture with respect to the Collateral;
(iii) exercise any remedies of a secured party under the UCC and
any other remedy available to the Indenture Trustee and take any other
appropriate action to protect and enforce the rights and remedies of the
Indenture Trustee on behalf of the Noteholders and the Insurer under this
Indenture or the Notes;
(iv) sell or cause the Servicer to otherwise liquidate the
Collateral or any portion thereof or rights or interests therein, at one or
more public or private sales called and conducted in any manner permitted
by law and deliver the proceeds of such sale or liquidation to the
Indenture Trustee for distribution in accordance with the terms of this
Indenture; and
(v) maintain possession of the Collateral.
(b) Notwithstanding the foregoing,
(i) in the event that the Indenture Trustee is acting at the
direction of the Insurer, so long as no Insurer Default shall have occurred
and be continuing, unless an Event of Default specified in Section 5.01
(a), (f) or (g) shall have occurred and be continuing, the Insurer shall
not have the right to cause the Indenture Trustee or the Servicer to, and
neither the Indenture Trustee nor the Servicer shall, liquidate the
Collateral in whole or in part if the proceeds of such sale or liquidation
would not be sufficient to pay all outstanding principal of and accrued
interest on the Notes unless the Insurer has paid the Notes in full under
the Insurance Policy; and
(ii) in the event that the Indenture Trustee is acting at the
direction of the Holders of Notes representing at least 66 2/3% of the
Outstanding
38
Principal Amount of the Notes, the Noteholders shall not have the right to
direct the Indenture Trustee or the Servicer to, and neither the Indenture
Trustee nor the Servicer shall, liquidate the Collateral in whole or in
part unless (A) an Event of Default as specified in Section 5.01 (b), (c),
(f), (g), (h) or (i) shall have occurred and be continuing and in any case
the Insurer shall have failed to make a payment required under the
Insurance Policy in accordance with its terms or (B)(1) an Event of Default
as specified in Section 5.01(d) or (e) shall have occurred and be
continuing, (2) the Insurer shall not have failed to make a payment
required under the Insurance Policy in accordance with its terms and (3)
the proceeds of such sale or liquidation would be sufficient to pay all
outstanding principal of and accrued interest on the Notes and all amounts
owing to the Insurer pursuant to the terms of the Insurance Agreement or
the other Basic Documents. In the event of a liquidation of the Collateral
pursuant to clause (ii), the Insurance Policy will not be available to
cover losses to Noteholders resulting from such liquidation, and the
Insurance Policy shall be terminated and the Insurer shall have no further
obligation to make any payment thereunder.
(c) In determining the sufficiency or insufficiency of the proceeds
of a sale or liquidation of the Collateral to pay all amounts required pursuant
to Section 5.04(b)(i) or (ii) above, the Indenture Trustee may, but need not, at
the sole expense of the Issuer obtain and rely upon an opinion of an Independent
investment banking or accounting firm of national reputation as to the
feasibility of such proposed action and as to the sufficiency of the Collateral
for such purpose.
SECTION 5.05. Optional Preservation of the Contracts. If the Notes
--------------------------------------
have been declared to be due and payable under Section 5.02 following an Event
of Default and such declaration and its consequences have not been rescinded and
annulled, the Indenture Trustee, absent direction to the contrary from the
Insurer or the Noteholders pursuant to Section 5.04, shall maintain possession
of the Collateral.
SECTION 5.06. Priorities.
----------
(a) If the Notes have been declared to be due and payable under
Section 5.02 following an Event of Default and such declaration and its
consequences have not been rescinded and annulled, any money collected by the
Indenture Trustee with respect to the Collateral or the Notes pursuant to this
Article or otherwise and any money that may then be held or thereafter received
by the Indenture Trustee with respect to the Collateral or the Notes (excluding
any payments made under the Insurance Policy), shall be applied in the following
order and priority:
first, to the Servicer, to pay any unpaid Servicing Fee;
second, to pay any accrued and unpaid Owner Trustee Fees and
Indenture Trustee Fees and reasonable out-of-pocket expenses without
preference or priority of any kind;
39
third, to the Noteholders, to pay accrued interest on each Class
of Notes on a pro rata basis, without preference or priority of any
--- ----
kind, based on the interest accrued (including, to the extent
permitted by applicable law, interest accrued on any interest accrued
but not timely paid) on each Class of Notes at the related Note Rate
for such Class;
fourth, to the Noteholders, to pay principal on each Class of
Notes on a pro rata basis, without preference or priority of any kind,
--- ----
based on the Outstanding Principal Amount of each Class of Notes,
until the Outstanding Principal Amount of each Class of Notes is
reduced to zero;
fifth, to the Insurer, to pay amounts owing to the Insurer under
the Insurance Agreement or any of the Basic Documents (including,
without limitation, the Insurance Premium); and
sixth, to the Holder of the Residual Interest Certificate.
(b) The Indenture Trustee may, upon notification to the Issuer and
the Insurer, fix a record date and payment date for any payment to Noteholders
pursuant to this Section. At least 15 days before such record date, the
Indenture Trustee shall mail or send by facsimile to each Noteholder and the
Insurer a notice that states the record date, the payment date and the amount to
be paid.
(c) Payments under the Insurance Policy following acceleration of the
Notes pursuant to Section 5.02 shall be applied by the Indenture Trustee as
follows:
first, to the payment of amounts due and unpaid on the Notes in
respect of interest, ratably, without preference or priority of any kind; and
second, to the payment of amounts due and unpaid on the Notes in
respect of principal, ratably, without preference or priority of any kind, until
the Notes are paid in full.
SECTION 5.07. 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 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
Indenture Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the Outstanding
Principal Amount of the Notes have made written request to the Indenture
Trustee to institute such Proceeding in respect of such Event of Default in
its own name as Indenture Trustee hereunder;
(iii) such Holder or Holders have offered to the Indenture
Trustee reasonable indemnity against the costs, expenses and liabilities to
be incurred in complying with such request;
40
(iv) the Indenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute such
Proceedings;
(v) no direction inconsistent with such written request has been
given to the Indenture Trustee during such 60-day period by the Holders of
a majority of the Outstanding Principal Amount of the Notes, voting
together as a single class; and
(vi) the Insurer has given its prior written consent or an
Insurer Default shall have occurred and be continuing.
It is understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
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.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of Notes,
each representing less than a majority of the Outstanding Principal Amount of
the Notes, the Indenture Trustee shall act at the direction of the group of
Holders of Notes with the greater amount of Outstanding Principal Amount of
Notes; however, if the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of Notes
with an equal Outstanding Principal Amount of Notes, the Indenture Trustee in
its sole discretion may determine what action, if any, shall be taken,
notwithstanding any other provisions of this Indenture and any such action shall
be binding on all parties.
SECTION 5.08. 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 on such Note on or after the
respective due dates thereof expressed in such Note or in this Indenture (or, in
the case of redemption, on or after the Redemption Date) and to institute suit
for the enforcement of any such payment, and such right shall not be impaired
without the consent of such Holder.
SECTION 5.09. Restoration of Rights and Remedies. If the Indenture
----------------------------------
Trustee, the Insurer or any Noteholder has instituted any Proceeding to enforce
any right or remedy under this Indenture and such Proceeding has been
discontinued or abandoned for any reason or has been determined adversely to the
Indenture Trustee, the Insurer or such Noteholder, then and in every such case
the Issuer, the Indenture Trustee, the Insurer and the Noteholders shall,
subject to any determination in such Proceeding, be restored severally and
respectively to their former positions hereunder, and thereafter all rights and
remedies of the Indenture Trustee, the Insurer and the Noteholders shall
continue as though no such Proceeding had been instituted.
41
SECTION 5.10. Rights and Remedies Cumulative. No right or remedy
------------------------------
herein conferred upon or reserved to the Indenture Trustee, the Insurer or to
the Noteholders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not a Waiver. No delay or omission of
------------------------------
the Indenture Trustee, the Insurer or any Holder of any 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 Indenture Trustee, the Insurer or to the Noteholders may be
exercised from time to time, and as often as may be deemed expedient, by the
Indenture Trustee, the Insurer or by the Noteholders, as the case may be.
SECTION 5.12. Control by Noteholders. If the Insurer is not the
----------------------
Controlling Party, the Holders of a majority of the Outstanding Principal Amount
of the Notes shall have the right to direct the time, method and place of
conducting any Proceeding for any remedy available to the Indenture Trustee with
respect to the Notes or exercising any trust or power conferred on the Indenture
Trustee; provided that:
--------
(i) such direction shall not be in conflict with any rule of
law or with this Indenture;
(ii) any direction to the Indenture Trustee to sell or liquidate
the Collateral shall be subject to the terms of Section 5.04; and
(iii) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee that is not inconsistent with such
direction.
Notwithstanding the rights of Noteholders set forth in this Section, subject to
Section 6.01, the Indenture Trustee need not take any action that it determines,
in its sole discretion, might involve it in liability or might materially
adversely affect the rights of any Noteholders not consenting to such action.
SECTION 5.13. Waiver of Past Defaults. Prior to the declaration of the
-----------------------
acceleration of the maturity of the Notes as provided in Section 5.02, the
Insurer or the Holders of Notes representing more than 50% of the Outstanding
Principal Amount of the Notes with the consent of the Insurer may waive any past
Default or Event of Default and its consequences except a Default (a) in the
payment of principal of or interest on any of the Notes or (b) in respect of a
covenant or provision hereof that cannot be modified or amended without the
consent of the Holder of each Note, as applicable. In the case of any such
waiver, the Issuer, the Indenture Trustee, the Insurer and the Holders of the
Notes shall be restored to their former positions and rights hereunder,
respectively; but no
42
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, unless otherwise specified in such waiver; but no
such waiver shall extend to any subsequent or other Default or Event of Default
or impair any right consequent thereto.
SECTION 5.14. Undertaking for Costs. All parties to this Indenture
---------------------
agree, and each Holder of any Note by such Holder's acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (i) any suit instituted by the
Indenture Trustee or the Insurer, (ii) any suit instituted by any Noteholder, or
group of Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Principal Amount of the Notes or (iii) any suit instituted by any
Noteholder for the enforcement of the payment of principal of or interest on any
Note on or after the respective due dates expressed in such Note and in this
Indenture (or, in the case of redemption, on or after the Redemption Date).
SECTION 5.15. Waiver of Stay or Extension Laws. The Issuer covenants
--------------------------------
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in and manner whatsoever, claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantages of any such law, and covenants that
it will not hinder, delay or impede the execution of any power herein granted to
the Indenture Trustee or the Insurer, but will suffer and permit the execution
of every such power as though no such law had been enacted.
SECTION 5.16. Action on Notes. The Indenture Trustee's right to seek
---------------
and recover judgment on the Notes or under this Indenture shall not be affected
by the seeking, obtaining or application of any other relief under or with
respect to this Indenture. Neither the lien of this Indenture nor any rights or
remedies of the Indenture Trustee, the Insurer or the Noteholders shall be
impaired by the recovery of any judgment by the Indenture Trustee or the Insurer
against the Issuer or by the levy of any execution under such judgment upon any
portion of the Collateral or upon any of the assets of the Issuer. Any money or
property collected by the Indenture Trustee shall be applied in accordance with
Section 5.06.
43
SECTION 5.17. Performance and Enforcement of Certain Obligations.
--------------------------------------------------
(a) Promptly following a request from the Indenture Trustee or the
Insurer to do so and at the Administrator's expense, the Issuer shall take all
such lawful action as the Indenture Trustee or the Insurer may request to compel
or secure the performance and observance by the Seller, the Originator, the
Custodian, the Administrator and the Servicer, as applicable, of each of their
obligations to the Issuer under or in connection with the Sale and Servicing
Agreement or the other Basic Documents, as applicable, 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 Sale
and Servicing Agreement or the other Basic Documents, as applicable, to the
extent and in the manner directed by the Indenture Trustee or the Insurer,
including the transmission of notices of default on the part of the Seller, the
Originator, the Custodian, the Administrator or the Servicer thereunder and the
institution of legal or administrative actions or proceedings to compel or
secure performance by the Seller, the Originator, the Custodian, the
Administrator or the Servicer of each of their obligations under the Sale and
Servicing Agreement or the other Basic Documents, as applicable.
(b) If the Indenture Trustee is the Controlling Party and if an Event
of Default has occurred and is continuing, the Indenture Trustee may, and at the
direction (which direction shall be given in writing and may include a
facsimile) of the Holders of 66 2/3% of the Outstanding Principal Amount of the
Notes shall, exercise all rights, remedies, powers, privileges and claims of the
Issuer against the Seller or the Servicer under or in connection with the 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 Servicer of each
of their obligations to the Issuer thereunder and to give any consent, request,
notice, direction, approval, extension or waiver under the Sale and Servicing
Agreement, and any right of the Issuer to take such action shall be suspended.
44
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.01. Duties of Indenture Trustee.
---------------------------
(a) If an Event of Default has occurred and is continuing, and of
which the Indenture Trustee shall have actual knowledge or has received notice,
the Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and with the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs; provided that if the Indenture Trustee shall assume
--------
the duties of the Servicer pursuant to Section 3.07(e), the Indenture Trustee in
performing such duties shall use the degree of care and skill customarily
exercised by a prudent institutional servicer with respect to automobile retail
installment sales contracts that it services for itself or others.
(b) Except during the continuance of an Event of Default of which a
Responsible Officer of the Indenture Trustee shall have actual knowledge or
written notice:
(i) the Indenture Trustee undertakes to perform such duties and
only such duties as are specifically set forth in this Indenture and no
implied covenants or obligations (including, without limitation, to
exercise any discretionary powers granted by this Indenture) shall be read
into this Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith or negligence on its part, the
Indenture Trustee may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; provided the Indenture Trustee shall
--------
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture and the other Basic Documents
to which the Indenture Trustee is a party; provided, further, that the
-------- -------
Indenture Trustee shall not be responsible for the accuracy or content of
any of the aforementioned documents and the Indenture Trustee shall have no
obligation to verify, re-compute or recalculate any numerical information
provided to it pursuant to the Basic Documents.
(c) The Indenture Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act or its own wilful
misconduct, except that:
(i) this paragraph does not limit the effect of Section 6.01(b);
(ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is proved
that the Indenture Trustee was negligent in ascertaining the pertinent
facts; and
45
(iii) the Indenture Trustee shall not be liable with respect to
any action it takes or omits to take in good faith in accordance with the
direction received by the Indenture Trustee pursuant to Section 5.12 of
this Indenture.
(d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to paragraphs (a), (b) and (c) of this Section
6.01.
(e) The Indenture Trustee shall not be liable for interest on any
money received by it except as the Indenture Trustee may agree in writing with
the Issuer.
(f) Money held in trust by the Indenture Trustee need not be
segregated from other funds except to the extent required by law or the terms of
this Indenture or the Sale and Servicing Agreement.
(g) No provision of this Indenture shall require the Indenture
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder or in the exercise of any of
its rights or powers, if it shall have reasonable grounds to believe that
repayments of such funds or indemnity satisfactory to the Indenture Trustee in
its reasonable discretion against such risk or liability is not assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of the
TIA.
(i) The Indenture Trustee shall, and hereby agrees that it will (i)
perform all of the obligations and duties required of it under the Sale and
Servicing Agreement and (ii) hold the Insurance Policy in trust, and will hold
any proceeds of any claim on the Insurance Policy in trust solely for
application to the Notes as provided in the Sale and Servicing Agreement.
(j) Except as otherwise required or permitted by the TIA, nothing
contained herein shall be deemed to authorize the Indenture Trustee to engage in
any business operations or any activities other than those set forth in this
Indenture. Specifically, the Indenture Trustee shall have no authority to engage
in any business operations, acquire any assets other than those specifically
included in the Collateral under this Indenture or otherwise vary the assets
held by the Trust. Similarly, the Indenture Trustee shall have no discretionary
duties other than performing those ministerial acts set forth above necessary to
accomplish the purpose of this Trust as set forth in this Indenture.
(k) The Indenture Trustee shall not be liable in its individual
capacity with respect to any action taken, suffered or omitted to be taken by it
in good faith in accordance with this Indenture or the Basic Documents or at the
direction of the Insurer or a majority of the Outstanding Principal Amount of
Notes or the Insurer, relating to the time, method and place of conducting any
Proceeding for any remedy available to the Indenture Trustee, or exercising or
omitting to exercise any trust or power conferred upon the Indenture Trustee,
under this Indenture.
46
(l) The Indenture Trustee shall not be required to take notice or be
deemed to have notice or knowledge of any Default or Event of Default unless a
Responsible Officer of the Indenture Trustee shall have actual knowledge thereof
or shall have received written notice thereof. In the absence of actual
knowledge or receipt of such notice, the Indenture Trustee may conclusively
assume that there is no Default or Event of Default.
(m) Subject to the other provisions of this Indenture and the Basic
Documents, the Indenture Trustee shall have no duty (i) to see to any recording,
filing, or depositing of this Agreement or any agreement referred to herein or
any financing statement or continuation statement evidencing a security
interest, or to see to the maintenance of any such recording or filing or
depositing or to any rerecording, refiling or redepositing of any thereof, (ii)
to see to any 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 Collateral,
or (iv) to confirm or verify the contents of any reports or certificates
delivered to the Indenture Trustee pursuant to this Indenture believed by the
Indenture Trustee to be genuine and to have been signed or presented by the
proper party or parties.
(n) In no event shall the Indenture Trustee be liable for lost
profits, even if the Indenture Trustee has been advised of the likelihood of
such loss or damage regardless of the form of action.
SECTION 6.02. Rights of Indenture Trustee.
---------------------------
(a) Except as otherwise provided in the second succeeding sentence,
the Indenture Trustee may conclusively rely and shall be protected in acting
upon or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, note, direction,
demand, election or other paper or document believed by it to be genuine and to
have been signed or presented by the proper person. The Indenture Trustee need
not investigate any fact or matter stated in the document. Notwithstanding the
foregoing, the Indenture Trustee, subject to Section 6.01(b)(ii) upon receipt of
all resolutions, certificates, statements, opinions, reports, documents, orders
or other instruments furnished to the Indenture Trustee that shall be
specifically required to be furnished pursuant to any provision of this
Indenture or any of the other Basic Documents, as applicable, shall examine them
to determine whether they comply as to form to the requirements of this
Indenture or any of the other Basic Documents, as applicable.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate (with respect to factual matters) or an Opinion
of Counsel, as applicable. The Indenture Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on the Officer's
Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee appointed by the Indenture Trustee
with due care,
47
provided, however, the Indenture Trustee shall not be responsible for the
-------- -------
negligence or misconduct of any custodian, subservicer or any other agent not
expressly appointed by the Indenture Trustee.
(d) The Indenture Trustee shall not be liable for any action it takes
or omits to take in good faith which it believes to be authorized or within its
rights or powers; provided that the Indenture Trustee's conduct does not
--------
constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice or
Opinion of Counsel with respect to legal matters relating to this Indenture and
the other Basic Documents and the Notes shall be full and complete authorization
and protection from liability in respect to any action taken, omitted or
suffered by it hereunder or thereunder in good faith and in accordance with the
advice or opinion of such counsel.
(f) The Indenture Trustee shall be under no obligation to exercise
any of the trusts or powers vested in it by this Indenture or to institute,
conduct or defend any litigation hereunder or in relation hereto at the request,
order or direction of any of the Noteholders, pursuant to the provisions of this
Indenture, unless such Noteholders shall have offered to the Indenture Trustee
security or indemnity satisfactory to the Indenture Trustee in its reasonable
discretion against the costs, expenses and liabilities which may be incurred
therein or thereby; nothing contained herein shall, however, relieve the
Indenture Trustee of the obligation, during the continuance of an Event of
Default of which a Responsible Officer of the Indenture Trustee shall have
actual knowledge, to exercise such of the rights and powers vested in it by this
Indenture, and to use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(g) The Indenture Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document, unless requested in writing to do so
by a majority of Noteholders; provided that if the payment within a reasonable
--------
time to the Indenture Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion of the
Indenture Trustee, not reasonably assured to the Indenture Trustee by the
security afforded to it by the terms of this Agreement, the Indenture Trustee
may require indemnity satisfactory to the Indenture Trustee in its reasonable
discretion against such cost, expense or liability as a condition to taking any
such action.
(h) The right of the Indenture Trustee to perform any discretionary
act enumerated in this Indenture shall not be construed as a duty, and the
Indenture Trustee shall not be answerable for other than its willful misconduct,
negligence or bad faith in the performance of such act.
SECTION 6.03. Individual Rights of Indenture Trustee. The Indenture
--------------------------------------
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Issuer or its Affiliates with the same
rights it would have
48
if it were not Indenture Trustee. Any Paying Agent, Note Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Indenture
Trustee is required to comply with Sections 6.11 and 6.12.
SECTION 6.04. Indenture Trustee's Disclaimer. The Indenture Trustee
------------------------------
shall not be responsible for and makes no representation as to the validity or
adequacy of this Indenture, the other Basic Documents, the Collateral or the
Notes, it shall not be accountable for the Issuer's use of the proceeds from the
Notes, and it shall not be responsible for any statement of the Issuer in this
Indenture or in any document issued in connection with the sale of the Notes or
in the Notes other than the Indenture Trustee's certificate of authentication.
SECTION 6.05. Notice of Defaults. If a Default occurs and is
------------------
continuing and a Responsible Officer of the Indenture Trustee has actual
knowledge or has received written notice thereof, the Indenture Trustee shall
mail to each Noteholder and the Insurer notice of the Default within 90 days
after it occurs and to the Insurer, notice of such Default promptly after it
occurs. Except in the case of a Default in payment of principal of or interest
on any Note (including payments pursuant to the redemption of Notes), the
Indenture Trustee may withhold the notice to the Noteholders if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of Noteholders.
SECTION 6.06. Reports by Indenture Trustee to Holders. The Indenture
---------------------------------------
Trustee shall deliver to each Noteholder such information as may be required to
enable such holder to prepare its federal and state income tax returns.
SECTION 6.07. Compensation and Indemnity. The Issuer shall pay or
--------------------------
cause the Administrator to pay to the Indenture Trustee from time to time
reasonable compensation for its services; provided, however, the amounts payable
-------- -------
by the Issuer hereunder shall be in amounts and in accordance with Section 4.03
of the Sale and Servicing Agreement. The Indenture Trustee's compensation shall
not be limited by any law on compensation of a trustee of an express trust. The
Issuer shall reimburse or cause the Administrator to reimburse the Indenture
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;
provided, however, the amounts payable by the Issuer hereunder shall be in
-------- -------
amounts and in accordance with Section 4.03 of the Sale and Servicing Agreement.
Such expenses shall include the reasonable compensation and expenses and
disbursements and advances of the Indenture Trustee's agents, counsel,
accountants and experts. The Indenture Trustee hereby agrees to act
notwithstanding any failure of the Servicer or the Administrator to pay any
costs or expenses to the Indenture Trustee. The Issuer shall, or shall cause the
Administrator to, indemnify the Indenture Trustee against any and all loss,
liability or expense (including attorneys' fees) incurred by it in connection
with the administration of this trust and the performance of its duties
hereunder, except that neither the Issuer nor the Administrator shall be liable
for or required to indemnify the Indenture Trustee from and against expenses
arising or resulting from negligence, bad faith or wilful misconduct on the part
of the Indenture Trustee; provided, however, any obligation of the Issuer in
-------- -------
respect of such indemnity
49
under this Section 6.07 shall not be payable from the Collateral or Trust
Property. The Indenture Trustee shall notify the Issuer and the Administrator
promptly in writing of any claim for which it may seek indemnity. Failure by the
Indenture Trustee to so notify the Issuer and the Administrator shall not
relieve the Issuer or the Administrator of its obligations hereunder, except as
provided in the last sentence of this paragraph. The Issuer shall, or shall
cause the Administrator to, defend any such claim, and the Indenture Trustee may
have separate counsel and the Issuer shall, or shall cause the Administrator to,
pay the fees and expenses of such counsel. Neither the Issuer nor the
Administrator need reimburse any expense or indemnify against any loss,
liability or expense incurred by the Indenture Trustee through the Indenture
Trustee's own willful misconduct, negligence or bad faith.
The Issuer's obligations to the Indenture Trustee pursuant to this
Section shall survive the resignation or removal of the Indenture Trustee and
the discharge of this Indenture. When the Indenture Trustee incurs expenses
after the occurrence of a Default specified in Section 5.01 (f) or (g) 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.
SECTION 6.08. Replacement of Indenture Trustee. The Indenture Trustee
--------------------------------
may resign at any time by so notifying the Issuer, the Servicer and the Insurer.
The Issuer may, with the consent of the Insurer, and, at the request of the
Insurer unless an Insurer Default shall have occurred and be continuing, shall,
remove the Indenture Trustee, if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) a court having jurisdiction in the premises in respect of
the Indenture Trustee in an involuntary case or proceeding under federal or
state banking or bankruptcy laws, as now or hereafter constituted, or any
other applicable federal or state bankruptcy, insolvency or other similar
law, shall have entered a decree or order granting relief or appointing a
receiver, liquidator, assignee, custodian, trustee, conservator,
sequestrator (or similar official) for the Indenture Trustee or for any
substantial part of the Indenture Trustee's property, or ordering the
winding-up or liquidation of the Indenture Trustee's affairs, provided any
such decree or order shall have continued unstayed and in effect for a
period of 30 consecutive days;
(iii) the Indenture Trustee commences a voluntary case under any
federal or state banking or bankruptcy laws, as now or hereafter
constituted, or any other applicable federal or state bankruptcy,
insolvency or other similar law, or consents to the appointment of or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
conservator, sequestrator or other similar official for the Indenture
Trustee or for any substantial part of the Indenture Trustee's property, or
makes any assignment for the benefit of creditors or fails generally to pay
its debts as such debts become due or takes any corporate action in
furtherance of any of the foregoing;
50
(iv) the Indenture Trustee otherwise becomes incapable of acting;
or
(v) the Indenture Trustee breaches any representation, warranty
or covenant made by it under any Basic Document.
If the Indenture Trustee resigns or is removed or if a vacancy exists
in the office of Indenture Trustee for any reason (the Indenture Trustee in such
event being referred to herein as the retiring Indenture Trustee), the Issuer
shall promptly appoint a successor Indenture Trustee acceptable to the Insurer.
A successor Indenture Trustee shall deliver a written acceptance of
its appointment to the retiring Indenture Trustee, the Insurer and to the
Issuer. Thereupon the resignation or removal of the retiring Indenture Trustee
shall become effective, and the successor Indenture Trustee shall have all the
rights, powers and duties of the Indenture Trustee under this Indenture. The
Issuer or the successor Indenture Trustee shall mail a notice of its succession
to Noteholders. The retiring Indenture Trustee shall promptly transfer all
property held by it as Indenture Trustee to the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 60 days
after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer, the Insurer or the Holders of a majority of the
Outstanding Principal Amount of the Notes may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee acceptable to
the Insurer.
If the Indenture Trustee fails to comply with Section 6.11, any
Noteholder, with the prior written consent of the Insurer, may petition any
court of competent jurisdiction for the removal of the Indenture Trustee and the
appointment of a successor Indenture Trustee acceptable to the Insurer.
Any resignation or removal of the Indenture Trustee and appointment of
a successor Indenture Trustee pursuant to the provisions of this Section shall
not become effective until acceptance of appointment by the successor Indenture
Trustee pursuant to this Section. Notwithstanding the replacement of the
Indenture Trustee pursuant to this Section, the retiring Indenture Trustee shall
be entitled to payment or reimbursement of such amounts as such Person is
entitled pursuant to Section 6.07.
SECTION 6.09. Successor Indenture Trustee by Merger. If the Indenture
-------------------------------------
Trustee consolidates with, merges or converts into, or transfers all or
substantially all its corporate trust business or assets to, another corporation
or banking association, the resulting, surviving or transferee corporation
without any further act shall be the successor Indenture Trustee; provided, that
such corporation or banking association shall be acceptable to the Insurer and
otherwise qualified and eligible under Section 6.11. The Indenture Trustee shall
provide the Insurer and each Rating Agency prompt notice of any such
transaction.
51
In case at the time such successor by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture while any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which, anywhere in the Notes or anywhere in this
Indenture, it is provided that the certificate of the Indenture Trustee shall
have.
SECTION 6.10. Appointment of Co-Indenture Trustee or Separate
-----------------------------------------------
Indenture Trustee.
-----------------
(a) Notwithstanding any other provision of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Collateral may at the time be located, the Indenture
Trustee, with the consent of the Insurer (so long as it is the Controlling
Party) 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, jointly with
the Indenture Trustee, or separate trustee or separate trustees, of all or any
part of the Trust Property, and to vest in such Person or Persons, in such
capacity and for the benefit of the Noteholders and the Insurer, such title to
the Collateral, or any part hereof, and, subject to the other provisions of this
Section, such powers, duties, obligations, rights and trusts as the Indenture
Trustee or the Insurer (so long as it is the Controlling Party) may consider
necessary or desirable. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor Indenture 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 6.08 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 Indenture Trustee shall be conferred or imposed upon and
exercised or performed by the Indenture Trustee and such separate trustee
or co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Indenture
Trustee joining in such act), except to the extent that under any law of
any jurisdiction in which any particular act or acts are to be performed
the Indenture Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust Property or any portion
thereof in any such jurisdiction) shall be exercised and performed singly
by such separate trustee or co-trustee, but solely at the direction of the
Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder; and
52
(iii) the Indenture 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 Indenture
Trustee shall be deemed to have been given to each of the then separate trustees
and co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Indenture and
the conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or property
specified in its instrument of co-appointment, either jointly with the Indenture
Trustee or separately, as may be provided therein, subject to all the provisions
of this Indenture, specifically including every provision relating to the
conduct of, affecting the liability of, or affording protection to, the
Indenture Trustee. Every such instrument shall be filed with the Indenture
Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee, its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect of
this Indenture on its behalf and in its name. If any separate trustee or co-
trustee shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be exercised
by the Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee. Notwithstanding anything to the
contrary in this Indenture, the appointment of any separate trustee or co-
trustee shall not relieve the Indenture Trustee of its obligations and duties
under this Indenture.
SECTION 6.11. Eligibility; Disqualification.
-----------------------------
(a) The Indenture Trustee shall be acceptable to the Insurer and
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition. The Indenture Trustee
shall provide copies of such reports to the Insurer upon request. The Indenture
Trustee shall comply with TIA Section 310(b); provided 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.
(b) If the long term debt rating of the Indenture Trustee shall not
be at least Baa3 from Moody's and BBB from Standard & Poor's, the Rating
Agencies and the Insurer shall be given notice of such lower long-term debt
rating.
SECTION 6.12. Preferential Collection of Claims Against Issuer. The
------------------------------------------------
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). An Indenture Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.
SECTION 6.13. Representations and Warranties of Indenture Trustee.
---------------------------------------------------
The Indenture Trustee hereby makes the following representations and warranties
on which the Issuer and Noteholders shall rely:
53
(a) the Indenture Trustee is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
formation; and
(b) the Indenture Trustee has full power, authority and legal right
to execute, deliver, and perform this Indenture and shall have taken all
necessary action to authorize the execution, delivery and performance by it of
this Indenture.
SECTION 6.14. Waiver of Setoffs. The Indenture Trustee hereby
-----------------
expressly waives any and all rights of setoff that the Indenture Trustee may
otherwise at any time have under applicable law with respect to the Trust
Property or the Trust Account Property and agrees that the amounts in the Trust
Accounts shall at all times be held and applied solely in accordance with the
provisions hereof and of the Sale and Servicing Agreement.
54
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.01. Indenture Trustee to Furnish Issuer Names and Addresses
-------------------------------------------------------
of Noteholders. The Indenture Trustee will furnish or cause to be furnished to
--------------
the Issuer and the Administrator (i) not more than five days after the earlier
of (a) each Record Date and (b) three months after the last Record Date, a list,
in such form as the Issuer may reasonably require, of the names and addresses of
the Holders of Notes as of such Record Date and (ii) at such other times as the
Issuer may request in writing, within 30 days after receipt by the Indenture
Trustee of any such request, a list of similar form and content as of a date not
more than ten days prior to the time such list is furnished; provided that so
--------
long as the Indenture Trustee is the Note Registrar, no such list shall be
required to be furnished. The Indenture Trustee or, if the Indenture Trustee is
not the Note Registrar, the Issuer shall furnish to the Insurer in writing at
such times as the Insurer may reasonably request a copy of the list.
SECTION 7.02. Preservation of Information; Communications to
----------------------------------------------
Noteholders.
-----------
(a) The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as provided
in Section 7.01 and the names and addresses of Holders of Notes received by the
Indenture Trustee in its capacity as Note Registrar. The Indenture Trustee may
destroy any list furnished to it as provided in such Section 7.01 upon receipt
of a new list so furnished. The Indenture Trustee shall make such list available
to the Insurer.
(b) Noteholders may communicate pursuant to TIA Section 312(b) with
other Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall
have the protection of TIA Section 312(c).
SECTION 7.03. Reports by Issuer.
-----------------
(a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after the
Issuer is required to file the same with the Commission, copies of the
annual reports and 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 Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from time to time by the
55
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 Indenture Trustee (and the Indenture 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
7.03(a) as may be required by rules and regulations prescribed from time to
time by the Commission.
SECTION 7.04. Fiscal Year. Unless the Issuer otherwise determines,
-----------
the fiscal year of the Issuer shall end on December 31 of each calendar year.
SECTION 7.05. Reports by Indenture Trustee. To the extent that any of
----------------------------
the events described in TIA Section 313(a) shall have occurred, the Indenture
Trustee shall, within 60 days after each December 15 beginning with December 15,
_____, mail to the Issuer, the Insurer and each Noteholder as required by TIA
Section 313(c) a brief report dated as of such date that complies with TIA
Section 313(a). The Indenture Trustee also shall comply with TIA Section 313(b).
56
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.01. Collection of Money.
-------------------
(a) General. Except as otherwise expressly provided herein, the
-------
Indenture Trustee may demand payment or delivery of, and shall receive and
collect, directly and without intervention or assistance of any fiscal agent or
other intermediary, all money and other property payable to or receivable by the
Indenture Trustee pursuant to this Indenture. The Indenture Trustee shall apply
all such money received by it as provided in this Indenture. Except as otherwise
expressly provided in this Indenture, if any default occurs in the making of any
payment or performance under any agreement or instrument that is part of the
Collateral, the Indenture Trustee may take such action as may be appropriate to
enforce such payment or performance, including the institution and prosecution
of appropriate Proceedings. Any such action shall be without prejudice to any
right to claim a Default or Event of Default under this Indenture and any right
to proceed thereafter as provided in Article V.
(b) Claims Under Insurance Policy. The Notes will be insured by the
-----------------------------
Insurance Policy pursuant to the terms set forth therein, notwithstanding any
provisions to the contrary contained in this Indenture or the Sale and Servicing
Agreement. All amounts received under the Insurance Policy shall be used solely
for the payment to Noteholders of principal of and interest on the Notes.
SECTION 8.02. Trust Accounts.
--------------
(a) On or prior to the Closing Date, the Indenture Trustee shall
establish and maintain in the name of the Indenture Trustee, for the benefit of
the Noteholders and the Insurer, the Trust Accounts as provided in Section 4.01
of the Sale and Servicing Agreement.
(b) On the Business Day immediately preceding each Distribution Date,
based solely on the Distribution Date Statement, the Indenture Trustee shall
withdraw from the Collection Account an amount equal to the amount of Available
Funds available with respect to such Distribution Date and deposit such amount
into the Payment Account, as provided in Section 4.03(a) of the Sale and
Servicing Agreement. On each Distribution Date, the Indenture Trustee will apply
the Available Funds with respect to the related Collection Period, together with
amounts, if any, withdrawn from the Spread Account or representing payment of
the Insured Payment, to make the deposits to the Note Distribution Account
required pursuant to Section 4.03(a) of the Sale and Servicing Agreement.
(c) On each Distribution Date and the Redemption Date, the Indenture
Trustee shall distribute all amounts on deposit in the Note Distribution Account
in respect of such Distribution Date to Noteholders in the following order of
priority:
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(i) to the Holders of each Class of Notes, on a pro rata basis,
the Note Interest Distributable Amount for such Distribution Date;
(ii) if such Distribution Date is the Final Scheduled
Distribution Date with respect to a Class of Notes, to the Holders of such
Class of Notes, the Note Principal Distributable Amount to the extent of
the remaining Outstanding Principal Amount of such Class of Notes;
(iii) to the Holders of the Class A-1 Notes, the remaining Note
Principal Distributable Amount (after giving effect to the payment, if any,
described in clause (ii) above), until the Outstanding Principal Amount of
the Class A-1 Notes is reduced to zero;
(iv) to the Holders of the Class A-2 Notes, the remaining Note
Principal Distributable Amount (after giving effect to the payments, if
any, described in clauses (ii) and (iii) above), until the Outstanding
Principal Amount of the Class A-2 Notes is reduced to zero;
(v) to the Holders of the Class A-3 Notes, the remaining Note
Principal Distributable Amount (after giving effect to the payments, if
any, described in clauses (ii), (iii) and (iv) above), until the
Outstanding Principal Amount of the Class A-3 Notes is reduced to zero; and
(vi) to the Holders of the Class A-4 Notes, the remaining Note
Principal Distributable Amount (after giving effect to the payments, if
any, described in clauses (ii), (iii), (iv) and (v) above), until the
Outstanding Principal Amount of the Class A-4 Notes is reduced to zero.
(d) The Indenture Trustee shall make claims under the Insurance
Policy pursuant to Section 4.02(c) of the Sale and Servicing Agreement and in
accordance with the Insurance Policy. In making any such claim, the Indenture
Trustee shall comply with all the terms and conditions of the Insurance Policy.
Upon receipt of the Insured Payment, the Indenture Trustee shall distribute such
Insured Payment as part of the Note Distributable Amount under this Indenture.
SECTION 8.03. Release of Collateral.
---------------------
(a) Subject to the payment of its fees and expenses pursuant to
Section 6.07, the Indenture Trustee may, and when required by the provisions of
this Indenture shall, execute instruments to release property from the lien of
this Indenture, or convey the Indenture Trustee's interest in the same, in a
manner and under circumstances that are not inconsistent with the provisions of
this Indenture. No party relying upon an instrument executed by the Indenture
Trustee as provided in this Article shall be bound to ascertain the Indenture
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any monies.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and all sums due the Indenture Trustee pursuant to Section 6.07 have
been
58
paid in full and all due to the Insurer under the Basic Documents have been
paid, release any remaining portion of the Collateral that secured the Notes
from the lien of this Indenture and release to the Issuer or any other Person
entitled thereto any funds then on deposit in the Trust Accounts. The Indenture
Trustee shall release property from the lien of this Indenture pursuant to this
Section 8.03(b) only upon receipt by it and the Insurer of an Issuer Request
accompanied by an Officer's Certificate, an Opinion of Counsel and (if required
by the TIA) Independent Certificates in accordance with TIA Sections 314(c) and
314(d)(1) meeting the applicable requirements of Section 11.01.
SECTION 8.04. Opinion of Counsel. The Indenture Trustee and the
------------------
Insurer, shall receive at least seven days prior written notice when requested
by the Issuer to take any action pursuant to Section 8.03(a), accompanied by
copies of any instruments involved, and the Indenture Trustee and the Insurer,
shall also require, as a condition to such action, an Opinion of Counsel, in
form and substance satisfactory to the Indenture Trustee and the Insurer (and
not at the expense of the Indenture Trustee or the Insurer), 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 that such Opinion of Counsel shall not be
--------
required to express an opinion as to the fair value of the Collateral. Counsel
rendering any such opinion may rely, without independent investigation, on the
accuracy and validity of any certificate or other instrument delivered to the
Indenture Trustee in connection with any such action.
59
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.01. Supplemental Indentures Without Consent of Noteholders.
------------------------------------------------------
(a) Without the consent of the Holders of any Notes but with the
consent of the Insurer and with prior notice to each Rating Agency, the Issuer
and the Indenture Trustee, when authorized by an Issuer Order, and the other
parties hereto at any time and from time to time, may enter into one or more
indentures supplemental hereto (which shall conform to the provisions of the TIA
as in force at the date of the execution thereof), in form satisfactory to the
Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property at
any time subject to the lien of this Indenture, or better to assure, convey
and confirm unto the Indenture Trustee any property subject or required to
be subjected to the lien created by this Indenture, or to subject to the
lien created by 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 and the Insurer, or to surrender any right or
power herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be inconsistent
with any other provision herein or in any supplemental indenture or the
Basic Documents or to make any other provisions with respect to matters or
questions arising under this Indenture or in any supplemental indenture;
provided that such action shall not adversely affect the interests of the
--------
Holders of the Notes or the Insurer;
(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
60
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.
The Indenture Trustee is hereby authorized to join in the execution of
any such supplemental indenture and to make any further appropriate agreements
and stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, may, also without the consent of any of the Holders of the Notes but with
the consent of the Insurer and with prior notice to each Rating Agency, enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; provided that (1) such action shall
--------
not (A) materially and adversely affect the interests of any Noteholder, as
evidenced by an Opinion of Counsel to be delivered upon the request of the
Indenture Trustee or (B) as confirmed by each Rating Agency rating the Notes of
the related series, cause the then current rating assigned to any class of such
Notes to be withdrawn or reduced without regard to the Insurance Policy and (2)
an Opinion of Counsel as to applicable tax matters is delivered.
SECTION 9.02. Supplemental Indentures With Consent of Noteholders. The
---------------------------------------------------
Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, with
prior notice to each Rating Agency, with the consent of the Insurer and, so long
as the Insurer is not the Controlling Party, with the consent of the Holders of
not less than a majority of the Outstanding Principal Amount of the Notes,
acting as a single class, by Act of such Holders delivered to the Issuer and the
Indenture Trustee, enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to, or changing in any manner or
eliminating any of the provisions of, this Indenture or of modifying in any
manner the rights of the Holders of the Notes under this Indenture; provided
--------
that, subject to the express rights of the Insurer under the Basic Documents, no
such supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby:
(a) change the date of payment of any installment of principal of, or
interest on, any Note or reduce the principal amount thereof, the note rate
thereon or the Redemption Price with respect thereto, or change any place of
payment where, or the coin or currency in which, any Note or the interest
thereon is payable;
(b) impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of 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 (or, in the case of
redemption, on or after the Redemption Date);
(c) reduce the percentage of the Outstanding Principal Amount of the
Notes, the consent of the Holders of which is required for any such supplemental
61
indenture, 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;
(d) modify or alter the provisions of the second proviso to the
definition of the term "Outstanding";
(e) reduce the percentage of the Outstanding Principal Amount of the
Notes, the consent of the Holders of which is required to direct the Indenture
Trustee to sell or liquidate the Collateral pursuant to Section 5.04;
(f) decrease the percentage of the Outstanding Principal Amount of the
Notes required to amend this Indenture or the other Basic Documents;
(g) permit the creation of any lien ranking prior to or on a parity
with the lien created by this Indenture with respect to any part of the
Collateral for such Notes or, except as otherwise permitted or contemplated
herein, terminate the lien created by this Indenture on any property at any time
subject hereto or deprive the Holder of any Note of the security provided by the
lien created by this Indenture; or
(h) result in a taxable event to any Noteholder for federal income tax
purposes or result in the Trust being classified as an association or publicly
traded partnership taxable as a corporation for federal income tax purposes.
The Indenture Trustee may in its discretion determine whether or not
any Notes would be affected by any supplemental indenture and any such
determination shall be conclusive upon the Holders of all Notes, whether
theretofore or thereafter authenticated and delivered hereunder. The Indenture
Trustee shall not be liable for any such determination made in good faith.
It shall not be necessary for any act of Noteholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such act shall approve the substance thereof.
Promptly after the execution by the parties hereto of any supplemental
indenture pursuant to this Section, the Indenture Trustee shall mail to the
Holders of the Notes to which such amendment or supplemental indenture relates a
notice setting forth in general terms the substance of such supplemental
indenture. Any failure of the Indenture Trustee to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such supplemental indenture.
SECTION 9.03. Execution of Supplemental Indentures. In executing, or
------------------------------------
permitting the additional trusts created by, any supplemental indenture
permitted by this Article or the modifications thereby of the trusts created by
this Indenture, the Indenture Trustee shall, if it requests, be entitled to
receive, and subject to Sections 6.01 and 6.02 shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. The
Indenture Trustee may, but shall not be obligated to, enter into any such
supplemental
62
indenture that affects the Indenture Trustee's own rights, duties, liabilities
or immunities under this Indenture or otherwise. The Indenture Trustee shall
provide a fully executed copy of any supplemental indenture to this Indenture to
the Insurer and each Rating Agency.
SECTION 9.04. Effect of Supplemental Indenture. Upon the execution of
--------------------------------
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be, and shall be deemed to be, modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the parties hereto 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 supplemental indenture shall be, and shall be deemed to be, part of
the terms and conditions of this Indenture for any and all purposes.
SECTION 9.05. Conformity With Trust Indenture Act. Every amendment of
-----------------------------------
this Indenture and every supplemental indenture executed pursuant to this
Article shall conform to the requirements of the Trust Indenture Act as then in
effect so long as this Indenture shall then be qualified under the Trust
Indenture Act.
SECTION 9.06. Reference in Notes to Supplemental Indentures. Notes
---------------------------------------------
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee and the Insurer as to
any matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the Issuer, to any such supplemental
indenture may be prepared and executed by the Issuer and authenticated and
delivered by the Indenture Trustee in exchange for Outstanding Notes.
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ARTICLE X
REDEMPTION OF NOTES
SECTION 10.01. Redemption. In the event that the Servicer pursuant to
----------
Section 8.01(a) of the Sale and Servicing Agreement purchases the corpus of the
Trust, the Notes are subject to redemption in whole, but not in part, on the
Distribution Date on which such repurchase occurs, for a purchase price equal to
the Redemption Price; provided that the Issuer has available funds sufficient to
--------
pay the Redemption Price plus all amounts owed to the Insurer, the Servicer, the
----
Indenture Trustee and the Owner Trustee under the Basic Documents. The Seller,
the Servicer or the Issuer shall furnish the Insurer and each Rating Agency 20
days prior notice of such redemption and the Redemption Date. If the Notes are
to be redeemed pursuant to this Section 10.01, the Servicer or the Issuer shall
furnish notice of such election to the Indenture Trustee not later than 20 days
prior to the Redemption Date and shall deposit, one Business Day prior to the
Redemption Date, with the Indenture Trustee in the Note Distribution Account the
Redemption Price of the Notes to be redeemed and shall pay to the Insurer all
amounts due to it under the Basic Documents, whereupon all such Notes shall be
due and payable on the Redemption Date upon the furnishing of a notice complying
with Section 10.02 to each Holder of the Notes.
SECTION 10.02. Form of Redemption Notice. Notice of redemption under
-------------------------
Section 10.01 shall be given by the Administrator by first-class mail, postage
prepaid or by facsimile, mailed or transmitted not less than five days prior to
the applicable Redemption Date to each Holder of Notes, as of the close of
business on the Record Date preceding the applicable Redemption Date, at such
Holder's address appearing in the Note Register. In addition, the Administrator
shall notify the Insurer and the Rating Agencies upon the redemption of any
Class of Notes, as provided for in Section l(a)(i) of the Administration
Agreement.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
(iii) the place where such Notes are to be surrendered for
payment of the Redemption Price (which shall be the office or agency of the
Issuer to be maintained as provided in Section 3.02).
Notice of redemption of the Notes shall be given by the Administrator
in the name and at the expense of the Issuer. Failure to give notice of
redemption, or any defect therein, to any Holder of any Note shall not impair or
affect the validity of the redemption of any other Note.
SECTION 10.03. Notes Payable on Redemption Date. The Notes or portions
--------------------------------
thereof to be redeemed shall, following notice of redemption (if any) as
required by Section 10.02, on the Redemption Date become due and payable at the
Redemption
64
Price and (unless the Issuer shall default in the payment of the Redemption
Price) no interest shall accrue on the Redemption Price for any period after the
date to which accrued interest is calculated for purposes of calculating the
Redemption Price.
65
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Compliance Certificates and Opinions, etc.
------------------------------------------
(a) Upon any application or request by the Issuer to the Indenture
Trustee to take any action under any provision of this Indenture, the Issuer
shall furnish to the Indenture Trustee and the Insurer (i) an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with, (ii) an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with and (iii) if required by
the TIA, an Independent Certificate from a firm of certified public accountants
meeting the applicable requirements of this Section 11.01. Notwithstanding the
foregoing, in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Indenture, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition and
the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each 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 Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property subject to the lien created by this Indenture, the
Issuer, in addition to any obligation imposed in Section 11.01(a) or elsewhere
in this Indenture, shall furnish to the Indenture Trustee and the Insurer an
Officer's Certificate certifying or stating the opinion of the signer thereof as
to the fair value (within 90 days of such deposit) to the Issuer of the
Collateral or other property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the Indenture
Trustee and the Insurer 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
66
also deliver to the Indenture Trustee and the Insurer an Independent
Certificate as to the named matters, if the fair value to the Issuer of the
property to be so deposited and of all other such property 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 Officer's
Certificates delivered pursuant to clause (i) above and this clause (ii),
is 10% or more of the Outstanding Principal Amount of the Notes, but such
Officer's Certificate need not be furnished with respect to any property 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 one percent
(1%) of the Outstanding Principal Amount of the Notes.
(iii) Whenever any property or securities are to be released from
the lien created by this Indenture, the Issuer shall also furnish to the
Indenture Trustee and the Insurer 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 created by this Indenture in
contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the Indenture
Trustee and the Insurer an Officer's Certificate certifying or stating the
opinion of any signer thereof as to the matters described in clause (iii)
above, the Issuer shall also furnish to the Indenture Trustee and the
Insurer an Independent Certificate as to the same matters if the fair value
of the property or securities and of all other property or securities
released from the lien created by this Indenture since the commencement of
the then current fiscal year, as set forth in the Officer's Certificate
required by clause (iii) above and this clause (iv), equals 10% or more of
the Outstanding Principal Amount of the Notes, but such Officer's
Certificate need not be furnished in the case of any release of property or
securities if the fair value thereof as set forth in the related Officer's
Certificate is less than $25,000 or less than one percent of the then
Outstanding Principal Amount of the Notes.
SECTION 11.02. Form of Documents Delivered to Indenture Trustee. In
------------------------------------------------
any case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer 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 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
67
officers of the Servicer, the Seller or the Issuer, stating that the information
with respect to such factual matters is in the possession of the Servicer, the
Seller or the Issuer, unless such officer or counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI.
SECTION 11.03. Acts of Noteholders.
-------------------
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee, and, where it is hereby expressly required,
to the Issuer. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Noteholders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 6.01) conclusive in
favor of the Indenture Trustee and the Issuer, if made in the manner provided in
this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any 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
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Note.
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SECTION 11.04. Notices, etc., to Indenture Trustee, Issuer, Insurer
----------------------------------------------------
and Rating Agencies.
-------------------
(a) Any request, demand, authorization, direction, notice, consent,
waiver or Act of Noteholders or other documents provided or permitted by this
Indenture shall be in writing and if such request, demand, authorization,
direction, notice, consent, waiver or Act of Noteholders is to be made upon,
given or furnished to or filed with:
(i) the Indenture Trustee by any Noteholder, the Insurer or by
the Issuer shall be sufficient for every purpose hereunder if in writing,
personally delivered, sent by facsimile transmission and confirmed or
mailed by overnight service, to or with the Indenture Trustee at its
Corporate Trust Office;
(ii) the Issuer by the Indenture Trustee, the Insurer or by any
Noteholder shall be sufficient for every purpose hereunder if in writing,
personally delivered, sent by facsimile transmission and confirmed or
mailed by overnight service, to the Issuer addressed to: ANRC Auto Owner
Trust ___, in care of _______________, as Owner Trustee, _______________,
Attention: ______________________ , or at any other address furnished in
writing to the Indenture Trustee by the Issuer; or
(iii) the Insurer by the Issuer or the Indenture Trustee shall be
sufficient for any purpose hereunder if in writing, personally delivered,
sent by facsimile transmission and confirmed or mailed by overnight
service, to the Insurer addressed to: __________________________.
(b) Notices required to be given to the Rating Agencies by the Issuer,
the Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered, sent by facsimile transmission and confirmed or mailed by overnight
service, to (i) in the case of Moody's, at the following address: ▇▇▇▇▇'▇
Investors Service, ABS Monitoring Department, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇ and (ii) in the case of Standard & Poor's, at the following address:
Standard & Poor's Ratings Services, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Asset Backed Surveillance Department; or as to each of the foregoing,
at such other address as shall be designated by written notice to the other
parties.
SECTION 11.05. Notices to Noteholders; Waiver. Where this Indenture
------------------------------
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and 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.
69
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Noteholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Indenture Trustee shall be deemed to
be a sufficient giving of such notice.
Where this Indenture provides for notice to 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 11.06. Alternate Payment and Notice Provisions.
---------------------------------------
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Holder of a Note
providing for a method of payment, or notice by the Indenture Trustee or any
Paying Agent to such Holder, that is different from the methods provided for in
this Indenture for such payments or notices. The Issuer will furnish to the
Indenture Trustee a copy of each such agreement and the Indenture Trustee will
cause payments to be made and notices to be given in accordance with such
agreements.
SECTION 11.07. Conflict With Trust Indenture Act. If any provision
---------------------------------
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control.
The provisions of TIA Sections 310 through 317 that impose duties on
any Person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
SECTION 11.08. Effect of Headings and Table of Contents. The Article
----------------------------------------
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
SECTION 11.09. Successors and Assigns. All covenants and agreements in
----------------------
this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Indenture Trustee in
this Indenture shall bind its successors, co-trustees and agents.
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.
70
SECTION 11.11. Benefits of Indenture. The Insurer and its successors
---------------------
and assigns shall be a third-party beneficiary to the provisions of this
Indenture, and shall be entitled to rely upon and directly to enforce such
provisions of this Indenture so long as no Insurer Default shall have occurred
and be continuing. Nothing in this Indenture or in the Notes, express or
implied, shall give to any Person, other than the parties hereto and the Insurer
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
Collateral, any benefit or any legal or equitable right, remedy or claim under
this Indenture. The Insurer may disclaim any of its rights and powers under this
Indenture, but not its duties and obligations under the Insurance Policy, upon
delivery of a written notice to the Indenture Trustee.
SECTION 11.12. Legal Holidays. In any case where the date on which
--------------
any payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue on the amount of such payment for the period from and after any such
nominal date.
SECTION 11.13. Governing Law. This Indenture shall, in accordance
-------------
with Section 5-1401 of the General Obligations Law of the State of New York, be
governed by, and construed in accordance with, the laws of the State of New York
without regard to conflict of law provisions thereof.
SECTION 11.14. Counterparts. This Indenture may be executed in
------------
several counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
SECTION 11.15. Recording of Indenture. If this Indenture is subject
----------------------
to recording in any appropriate public recording offices, such recording is to
be effected by the Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Indenture Trustee or any other counsel
reasonably acceptable to the Indenture Trustee and the Insurer) to the effect
that such recording is necessary either for the protection of the Noteholders or
any other Person secured hereunder or for the enforcement of any right or remedy
granted to the Indenture Trustee under this Indenture.
SECTION 11.16. Trust Obligation. No recourse may be taken, directly
----------------
or indirectly, with respect to the obligations of the Issuer, the Owner Trustee
or the Indenture Trustee on the Notes or under this Indenture or any certificate
or other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or
of any successor or assign of the Indenture Trustee or the Owner Trustee in its
individual capacity, except as any such Person may have expressly agreed (it
being understood that the Indenture Trustee and the Owner Trustee have no such
obligations in their individual
71
capacity) and except that any such partner, owner or beneficiary shall be fully
liable, to the extent provided by applicable law, for any unpaid consideration
for stock, unpaid capital contribution or failure to pay any installment or call
owing to such entity. 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 Owner Trust Agreement.
SECTION 11.17. No Petition. The parties hereto, by entering into this
-----------
Indenture, and each Noteholder, by accepting a Note or a beneficial interest in
a Note, hereby covenant and agree that they will not at any time institute
against the Seller or the Issuer, or join in any 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.
SECTION 11.18. Inspection. The Issuer agrees that, on reasonable
----------
prior notice, it will permit any representative of the Indenture Trustee or of
the Insurer, 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 Indenture Trustee and the Insurer shall and shall cause their
respective representatives to hold in confidence all such information except to
the extent disclosure may be required by law (and all reasonable applications
for confidential treatment are unavailing) and except to the extent that the
Indenture Trustee and the Insurer may reasonably determine that such disclosure
is consistent with its obligations hereunder.
SECTION 11.19. Limitation of Liability of Owner Trustee.
----------------------------------------
Notwithstanding anything contained herein to the contrary, this instrument has
been countersigned by __________ not in its individual capacity but solely in
its capacity as Owner Trustee of the Issuer and in no event shall ___________ in
its individual capacity or any beneficial owner of the Issuer have any liability
for the representations, warranties, covenants, agreements or other obligations
of the Issuer hereunder, as to all of which recourse shall be had solely to the
assets of the Issuer. For all purposes of this Agreement, 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 Owner Trust Agreement. Notwithstanding anything
herein to the contrary, Section 2.07 of the Owner Trust Agreement shall remain
in full force and effect.
SECTION 11.20. Certain Matters Regarding the Insurer. So long as an
-------------------------------------
Insurer Default shall not have occurred and be continuing, the Insurer shall
have the right to exercise all rights, including voting rights, which the
Noteholders are entitled to exercise pursuant to this Indenture, without any
consent of such Noteholders, subject to any rights specifically granted to
Noteholders in respect of amendments to this Agreement pursuant to Sections
3.07(e) and 9.02.
72
Notwithstanding any provision in this Indenture to the contrary, for
so long as an Insurer Default shall have occurred and be continuing, the Insurer
shall not have the right to take any action under this Agreement or to control
or direct the actions of the Trust, the Seller, the Indenture Trustee or the
Owner Trustee pursuant to the terms of this Indenture, nor shall the consent of
the Insurer be required with respect to any action (or waiver of a right to take
action) to be taken by the Trust, the Seller, the Indenture Trustee, the Owner
Trustee or the Noteholders; provided that the consent of the Insurer shall be
--------
required at all times (which consent, so long as an Insurer Default has occurred
and is continuing, shall not be unreasonably withheld) with respect to any
amendment of this Indenture.
73
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed and delivered as of the day and year first above written.
ANRC AUTO OWNER TRUST
_________, as Issuer
By: ____________, not in its individual
capacity but solely as Owner Trustee
By: ____________________
Name:
Title:
________________________,
as Indenture Trustee
By: ____________________
Name:
Title:
74
SCHEDULE A
SCHEDULE OF CONTRACTS
[Schedules of Contracts are on file at the offices of the Seller, the Servicer,
the Indenture Trustee and the Insurer]
EXHIBIT A
---------
FORM OF NOTE DEPOSITORY AGREEMENT
[Begins on Next Page]
EXHIBIT B
---------
FORM OF CLASS A-1 NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
---
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT
INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
ANRC AUTO OWNER TRUST ____________
____% ASSET-BACKED NOTE, CLASS A-1
REGISTERED $_____________________
No. 1 CUSIP NO. __________________
ANRC Auto Owner Trust ______________, a business trust organized and
existing under the laws of the State of Delaware (the "Issuer"), for value
------
received, hereby promises to pay to Cede & Co., or registered assigns, the
principal sum of _________________________________ ($_____________), payable to
the extent described in the Indenture and the Sale and Servicing Agreement
referred to on the reverse hereof on each Distribution Date; provided that the
--------
entire unpaid principal amount of this Note shall be payable on the earlier of
the Distribution Date occurring in _____________________ (the "Class A-1 Final
---------------
Scheduled Distribution Date") and the Redemption Date, if any, selected pursuant
---------------------------
to the Indenture.
The Issuer will pay interest on this Note at the Class A-1 Note Rate
shown above on each Distribution Date until the principal of this Note is paid
or made available for payment, on the principal amount of this Note outstanding
on the preceding Distribution Date (after giving effect to all payments of
principal made on the preceding Distribution Date), or on the Closing Date in
the case of the first Distribution Date, subject to certain limitations
contained in the Indenture. Interest on this Note will accrue
for each Distribution Date during the period (the "Interest Accrual Period" with
-----------------------
respect to such Distribution Date) from and including the Distribution Date
immediately preceding such Distribution Date (or, in the case of the first
Distribution Date, from and including the Closing Date) to but excluding such
Distribution Date. The Issuer shall pay interest on overdue installments of
interest at the Class A-1 Note Rate to the extent lawful. Interest will be
computed on the basis of a 360-day year and the actual number of days in the
related Interest Accrual Period. Such principal of and interest on this Note
shall be paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Insurance Policy") issued by ___________ (the "Insurer"),
---------------- -------
pursuant to which the Insurer has unconditionally guaranteed payment of the Note
Interest Distributable Amount on each Distribution Date and the Guaranteed Note
Principal Amount of the Notes, all as more fully set forth in the Insurance
Policy.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture referred to on the
reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by an Authorized Officer, as set forth below.
Date: ______________, _____ ANRC AUTO OWNER TRUST _______________
By: _________________________________,
not in its individual capacity, but
solely as Owner Trustee
By: _________________________________,
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
____________________________, as
Indenture Trustee
By: ____________________________
Authorized Signatory
[REVERSE OF CLASS A-1 NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its "____% Asset-Backed Notes, Class A-1" (the "Class A-1 Notes"),
---------------
all issued under the Indenture, dated as of _________, ____ (as amended,
supplemented or otherwise modified and in effect from time to time, the
"Indenture"), between the Issuer and ______________________, as indenture
---------
trustee (the "Indenture Trustee"), to which Indenture and all indentures
-----------------
supplemental thereto reference is hereby made for a statement of the respective
rights and obligations thereunder of the Issuer, the Insurer, the Indenture
Trustee and the Holders of the Notes. The Notes are subject to all terms of the
Indenture. All terms used in this Note that are defined in the Indenture, as
supplemented or amended, shall have the meanings assigned to them in or pursuant
to the Indenture, as so supplemented or amended, and if not defined therein, in
the Sale and Servicing Agreement (as defined in the Indenture).
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably
-----
secured by the collateral pledged as security therefor as provided in the
Indenture.
Principal payable on the Class A-1 Notes will be paid on each
Distribution Date in the amount specified in the Indenture and the Sale and
Servicing Agreement. As described above, the entire unpaid principal amount of
this Note will be payable on the earlier of the Class A-1 Final Scheduled
Distribution Date and the Redemption Date, if any, selected pursuant to the
Indenture. Notwithstanding the foregoing, under certain circumstances, the
entire unpaid principal amount of the Class A-1 Notes shall be due and payable
following the occurrence and continuance of an Event of Default, as described in
the Indenture. All principal payments on the Class A-1 Notes shall be made pro
---
rata to the Class A-1 Noteholders entitled thereto.
----
Payments of principal and interest on this Note due and payable on
each Distribution Date or Redemption Date shall be made by check mailed to the
Person whose name appears as the registered Holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on the
related Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such nominee
to be Cede & Co.), payments will be made by wire transfer in immediately
available funds to the account designated by such nominee. Such checks shall be
mailed to the Person entitled thereto at the address of such Person as it
appears on the Note Register as of the applicable Record Date without requiring
that this Note be submitted for notation of payment. Any reduction in the
principal amount of this Note (or any one or more Predecessor Notes) affected by
any payments made on any Distribution Date or Redemption Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not noted hereon. If funds are expected to be available, as provided in the
Indenture, for payment in full of the remaining unpaid principal amount of this
Note on a Distribution Date or Redemption Date, then the Indenture Trustee, in
the name of and on behalf of the Issuer, will notify the Person who was the
registered Holder hereof as of the Record Date preceding such
Distribution Date or Redemption Date by notice mailed within five days of such
Distribution Date or Redemption Date and the amount then due and payable shall
be payable only upon presentation and surrender of this Note at the Corporate
Trust Office of the Indenture Trustee or at the office of the Indenture
Trustee's agent appointed for such purposes located in The City of New York.
As provided in the Indenture, the Notes are subject to redemption in
whole, but not in part, on any Distribution Date as of which the Pool Balance is
less than or equal to 10% of the Original Pool Balance.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or Agency
designated by the Issuer pursuant to the Indenture. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such registration
of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under
the Indenture or any certificate or other writing delivered in connection
therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Indenture Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary shall be
fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that by
accepting the benefits of the Indenture and such Note that such Noteholder or
Note Owner will not at any time institute against the Seller or the Issuer, or
join in any institution against the Seller or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States Federal or state bankruptcy or similar law.
The Issuer has entered into the Indenture, and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness secured by
the Collateral. Each Noteholder, by acceptance of a Note (and each Note Owner
by acceptance of a beneficial interest in a Note), agrees to treat the Notes for
federal, state and local income, single business and franchise tax purposes as
indebtedness.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and the Insurer and any agent of the
Issuer, the Indenture Trustee or the Insurer may treat the Person in whose name
this Note (as of the day of determination or as of such other date as may be
specified in the Indenture) is registered as the owner hereof for all purposes,
whether or not this Note be overdue, and neither the Issuer, the Indenture
Trustee, the Insurer nor any such agent shall be affected by notice to the
contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Insurer and, so long as an Insurer
Default has occurred and is continuing, of the Holders of Notes representing not
less than a majority of the Outstanding Principal Amount of the Notes. The
Indenture also contains provisions permitting the Insurer and, so long as an
Insurer Default has occurred and is continuing, the Indenture Trustee or the
Holders of Notes representing specified percentages of the Outstanding Principal
Amount of the Notes, on behalf of the Holders of all the Notes, to waive
compliance by the Issuer with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Insurer or Holder of this Note (or any one of more Predecessor
Notes) shall be conclusive and binding upon such Insurer or Holder and upon all
future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note. The Indenture also permits
the Indenture Trustee with the consent of the Insurer to amend or waive certain
terms and conditions set forth in the Indenture without the consent of Holders
of the Notes issued thereunder.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall, in accordance with Section 5-1401
of the General Obligations Law of the State of New York, be construed in
accordance with the laws of the State of New York without regard to its conflict
of law provisions, and the obligations, rights and remedies of the parties
hereunder and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency herein prescribed.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints __________________________, attorney, to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: */
Signature Guaranteed:
*/
*/NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within Note in
every particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.
EXHIBIT C
---------
FORM OF CLASS A-2 NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
---
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT
INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
ANRC AUTO OWNER TRUST ____________
____% ASSET-BACKED NOTE, CLASS A-2
REGISTERED $______________
No. 1 CUSIP NO. ________________
ANRC Auto Owner Trust _______________, a business trust organized and
existing under the laws of the State of Delaware (the "Issuer"), for value
------
received, hereby promises to pay to Cede & Co., or registered assigns, the
principal sum of ________________________________, ($____________), payable to
the extent described in the Indenture and the Sale and Servicing Agreement
referred to on the reverse hereof on each Distribution Date; provided that the
--------
entire unpaid principal amount of this Note shall be payable on the earlier of
the Distribution Date occurring in ____________________________ (the "Class A-2
---------
Final Scheduled Distribution Date") and the Redemption Date, if any, selected
---------------------------------
pursuant to the Indenture. No payments of principal of the Class A-2 Notes
shall be made until the principal amount of the Class A-1 Notes has been reduced
to zero.
The Issuer will pay interest on this Note at the Class A-2 Note Rate
shown above on each Distribution Date until the principal of this Note is paid
or made available for payment, on the principal amount of this Note outstanding
on the preceding Distribution Date (after giving effect to all payments of
principal made on the preceding
Distribution Date), or on the Closing Date in the case of the first Distribution
Date, subject to certain limitations contained in the Indenture. Interest on
this Note will accrue for each Distribution Date during the period (the
"Interest Accrual Period" with respect to such Distribution Date) from and
-----------------------
including the Distribution Date immediately preceding such Distribution Date
(or, in the case of the first Distribution Date, from and including the Closing
Date) to but excluding such Distribution Date. The Issuer shall pay interest on
overdue installments of interest at the Class A-2 Note Rate to the extent
lawful. Interest will be computed on the basis of a 360-day year of twelve 30-
day months. Such principal of and interest on this Note shall be paid in the
manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Insurance Policy") issued by ____________ (the
----------------
"Insurer"), pursuant to which the Insurer has unconditionally guaranteed payment
-------
of the Note Interest Distributable Amount on each Distribution Date and the
Guaranteed Principal Amount of the Notes as more fully set forth in the
Insurance Policy.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture referred to on the
reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by an Authorized Officer, as set forth below.
Date: ______________, _____ ANRC AUTO OWNER TRUST
By: ____________________________________,
not in its individual capacity, but
solely as Owner Trustee
By: ____________________________________,
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
___________________________, as
Indenture Trustee
By: ___________________________
Authorized Signatory
[REVERSE OF CLASS A-2 NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its "____% Asset-Backed Notes, Class A-2" (the "Class A-2 Notes"),
---------------
all issued under the Indenture, dated as of _________, ____ (as amended,
supplemented or otherwise modified and in effect from time to time, the
"Indenture"), between the Issuer and , as indenture trustee (the
"Indenture Trustee"), to which Indenture and all indentures supplemental thereto
-----------------
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Insurer, the Indenture Trustee and the
Holders of the Notes. The Notes are subject to all terms of the Indenture. All
terms used in this Note that are defined in the Indenture, as supplemented or
amended, shall have the meanings assigned to them in or pursuant to the
Indenture, as so supplemented or amended, and if not defined therein, in the
Sale and Servicing Agreement (as defined in the Indenture).
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably
-----
secured by the collateral pledged as security therefor as provided in the
Indenture.
Principal payable on the Class A-2 Notes will be paid on each
Distribution Date in the amount specified in the Indenture and the Sale and
Servicing Agreement. As described above, the entire unpaid principal amount of
this Note will be payable on the earlier of the Class A-2 Final Scheduled
Distribution Date and the Redemption Date, if any, selected pursuant to the
Indenture. Notwithstanding the foregoing, under certain circumstances, the
entire unpaid principal amount of the Class A-2 Notes shall be due and payable
following the occurrence and continuance of an Event of Default, as described in
the Indenture. All principal payments on the Class A-2 Notes shall be made pro
---
rata to the Class A-2 Noteholders entitled thereto.
----
Payments of principal and interest on this Note due and payable on
each Distribution Date or Redemption Date shall be made by check mailed to the
Person whose name appears as the registered Holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on the
related Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such nominee
to be Cede & Co.), payments will be made by wire transfer in immediately
available funds to the account designated by such nominee. Such checks shall be
mailed to the Person entitled thereto at the address of such Person as it
appears on the Note Register as of the applicable Record Date without requiring
that this Note be submitted for notation of payment. Any reduction in the
principal amount of this Note (or any one or more Predecessor Notes) affected by
any payments made on any Distribution Date or Redemption Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not noted hereon. If funds are expected to be available, as provided in the
Indenture, for payment in full of the remaining unpaid principal amount of this
Note on a Distribution Date or Redemption Date, then the Indenture Trustee, in
the name of and on behalf of the Issuer, will notify the Person who was the
registered Holder hereof as of the Record Date preceding such
Distribution Date or Redemption Date by notice mailed within five days of such
Distribution Date or Redemption Date and the amount then due and payable shall
be payable only upon presentation and surrender of this Note, at the Corporate
Trust Office of the Indenture Trustee or at the office of the Indenture
Trustee's agent appointed for such purposes located in The City of New York.
As provided in the Indenture, the Notes are subject to redemption in
whole, but not in part, on any Distribution Date as of which the Pool Balance is
less than or equal to 10% of the Original Pool Balance.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or Agency
designated by the Issuer pursuant to the Indenture. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such registration
of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under
the Indenture or any certificate or other writing delivered in connection
therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Indenture Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary shall be
fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that by
accepting the benefits of the Indenture and such Note that such Noteholder or
Note Owner will not at any time institute against the Seller or the Issuer, or
join in any institution against the Seller or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States Federal or state bankruptcy or similar law.
The Issuer has entered into the Indenture, and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness secured by
the Collateral. Each Noteholder, by acceptance of a Note (and each Note Owner
by acceptance of a beneficial interest in a Note), agrees to treat the Notes for
federal, state and local income, single business and franchise tax purposes as
indebtedness.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and the Insurer and any agent of the
Issuer, the Indenture Trustee or the Insurer may treat the Person in whose name
this Note (as of the day of determination or as of such other date as may be
specified in the Indenture) is registered as the owner hereof for all purposes,
whether or not this Note be overdue, and neither the Issuer, the Indenture
Trustee, the Insurer nor any such agent shall be affected by notice to the
contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Insurer and, so long as an Insurer
Default has occurred and is continuing, of the Holders of Notes representing not
less than a majority of the Outstanding Principal Amount of the Notes. The
Indenture also contains provisions permitting the Insurer and, so long as an
Insurer Default has occurred and is continuing, the Indenture Trustee or the
Holders of Notes representing specified percentages of the Outstanding Principal
Amount of the Notes, on behalf of the Holders of all the Notes, to waive
compliance by the Issuer with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Insurer or Holder of this Note (or any one of more Predecessor
Notes) shall be conclusive and binding upon such Insurer or Holder and upon all
future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note. The Indenture also permits the
Indenture Trustee with the consent of the Insurer to amend or waive certain
terms and conditions set forth in the Indenture without the consent of Holders
of the Notes issued thereunder.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall, in accordance with Section 5-1401
of the General Obligations Law of the State of New York, be construed in
accordance with the laws of the State of New York without regard to its conflict
of law provisions, and the obligations, rights and remedies of the parties
hereunder and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency herein prescribed.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of
assignee:
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints __________________________, attorney, to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: */
Signature Guaranteed:
*/
*/NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within Note in
every particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.
EXHIBIT D
---------
FORM OF CLASS A-3 NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
---
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT
INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
ANRC AUTO OWNER TRUST __________
____% ASSET-BACKED NOTE, CLASS A-3
REGISTERED $____________________
No. 1 CUSIP NO. ________________
ANRC Auto Owner Trust _______________, a business trust organized and
existing under the laws of the State of Delaware (the "Issuer"), for value
------
received, hereby promises to pay to Cede & Co., or registered assigns, the
principal sum of ________________________________, ($____________), payable to
the extent described in the Indenture and the Sale and Servicing Agreement
referred to on the reverse hereof on each Distribution Date; provided that the
--------
entire unpaid principal amount of this Note shall be payable on the earlier of
the Distribution Date occurring in ____________________________ (the "Class A-3
---------
Final Scheduled Distribution Date") and the Redemption Date, if any, selected
---------------------------------
pursuant to the Indenture. No payments of principal of the class A-3 Notes shall
be made until the principal amount of the Class A-1 and Class A-2 Notes have
been reduced to zero.
The Issuer will pay interest on this Note at the Class A-3 Note Rate
shown above on each Distribution Date until the principal of this Note is paid
or made available for payment, on the principal amount of this Note outstanding
on the preceding Distribution Date (after giving effect to all payments of
principal made on the preceding
Distribution Date), or on the Closing Date in the case of the first Distribution
Date, subject to certain limitations contained in the Indenture. Interest on
this Note will accrue for each Distribution Date during the period (the
"Interest Accrual Period" with respect to such Distribution Date) from and
-----------------------
including the Distribution Date immediately preceding such Distribution Date
(or, in the case of the first Distribution Date, from and including the Closing
Date) to but excluding such Distribution Date. The Issuer shall pay interest on
overdue installments of interest at the Class A-3 Note Rate to the extent
lawful. Interest will be computed on the basis of a 360-day year of twelve 30-
day months. Such principal of and interest on this Note shall be paid in the
manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Insurance Policy") issued by _________________ (the
----------------
"Insurer"), pursuant to which the Insurer has unconditionally guaranteed payment
-------
of the Note Interest Distributable Amount on each Distribution Date and the
Guaranteed Principal Amount of the Notes as more fully set forth in the
Insurance Policy.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture referred to on the
reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by an Authorized Officer, as set forth below.
Date: _______________, _____ ANRC AUTO OWNER TRUST ______________________
By:_________________________________________,
not in its individual capacity, but
solely as Owner Trustee
By:_________________________________________,
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
______________________________, as
Indenture Trustee
By: ______________________________
Authorized Signatory
[REVERSE OF CLASS A-3 NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its "____% Asset-Backed Notes, Class A-3" (the "Class A-3 Notes"),
---------------
all issued under the Indenture, dated as of _________, ____ (as amended,
supplemented or otherwise modified and in effect from time to time, the
"Indenture"), between the Issuer and ________________, as indenture trustee (the
---------
"Indenture Trustee"), to which Indenture and all indentures supplemental thereto
-----------------
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Insurer, the Indenture Trustee and the
Holders of the Notes. The Notes are subject to all terms of the Indenture. All
terms used in this Note that are defined in the Indenture, as supplemented or
amended, shall have the meanings assigned to them in or pursuant to the
Indenture, as so supplemented or amended, and if not defined therein, in the
Sale and Servicing Agreement (as defined in the Indenture).
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably
-----
secured by the collateral pledged as security therefor as provided in the
Indenture.
Principal payable on the Class A-3 Notes will be paid on each
Distribution Date in the amount specified in the Indenture and the Sale and
Servicing Agreement. As described above, the entire unpaid principal amount of
this Note will be payable on the earlier of the Class A-3 Final Scheduled
Distribution Date and the Redemption Date, if any, selected pursuant to the
Indenture. Notwithstanding the foregoing, under certain circumstances, the
entire unpaid principal amount of the Class A-3 Notes shall be due and payable
following the occurrence and continuance of an Event of Default, as described in
the Indenture. All principal payments on the Class A-3 Notes shall be made pro
---
rata to the Class A-3 Noteholders entitled thereto.
----
Payments of principal and interest on this Note due and payable on
each Distribution Date or Redemption Date shall be made by check mailed to the
Person whose name appears as the registered Holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on the
related Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such nominee
to be Cede & Co.), payments will be made by wire transfer in immediately
available funds to the account designated by such nominee. Such checks shall be
mailed to the Person entitled thereto at the address of such Person as it
appears on the Note Register as of the applicable Record Date without requiring
that this Note be submitted for notation of payment. Any reduction in the
principal amount of this Note (or any one or more Predecessor Notes) affected by
any payments made on any Distribution Date or Redemption Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not noted hereon. If funds are expected to be available, as provided in the
Indenture, for payment in full of the remaining unpaid principal amount of this
Note on a Distribution Date or Redemption Date, then the Indenture Trustee, in
the name of and on behalf of the Issuer, will notify the Person who was the
registered Holder hereof as of the Record Date preceding such
Distribution Date or Redemption Date by notice mailed within five days of such
Distribution Date or Redemption Date and the amount then due and payable shall
be payable only upon presentation and surrender of this Note, at the Corporate
Trust Office of the Indenture Trustee or at the office of the Indenture
Trustee's agent appointed for such purposes located in The City of New York.
As provided in the Indenture, the Notes are subject to redemption in
whole, but not in part, on any Distribution Date as of which the Pool Balance is
less than or equal to 10% of the Original Pool Balance.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or Agency
designated by the Issuer pursuant to the Indenture. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such registration
of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under
the Indenture or any certificate or other writing delivered in connection
therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Indenture Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary shall be
fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that by
accepting the benefits of the Indenture and such Note that such Noteholder or
Note Owner will not at any time institute against the Seller or the Issuer, or
join in any institution against the Seller or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States Federal or state bankruptcy or similar law.
The Issuer has entered into the Indenture, and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness secured by
the Collateral. Each Noteholder, by acceptance of a Note (and each Note Owner by
acceptance of a beneficial interest in a Note), agrees to treat the Notes for
federal, state and local income, single business and franchise tax purposes as
indebtedness.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and the Insurer and any agent of the
Issuer, the Indenture Trustee or the Insurer may treat the Person in whose name
this Note (as of the day of determination or as of such other date as may be
specified in the Indenture) is registered as the owner hereof for all purposes,
whether or not this Note be overdue, and neither the Issuer, the Indenture
Trustee, the Insurer nor any such agent shall be affected by notice to the
contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Insurer and, so long as an Insurer
Default has occurred and is continuing, of the Holders of Notes representing not
less than a majority of the Outstanding Principal Amount of the Notes. The
Indenture also contains provisions permitting the Insurer and, so long as an
Insurer Default has occurred and is continuing, the Indenture Trustee or the
Holders of Notes representing specified percentages of the Outstanding Principal
Amount of the Notes, on behalf of the Holders of all the Notes, to waive
compliance by the Issuer with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Insurer or Holder of this Note (or any one of more Predecessor
Notes) shall be conclusive and binding upon such Insurer or Holder and upon all
future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note. The Indenture also permits the
Indenture Trustee with the consent of the Insurer to amend or waive certain
terms and conditions set forth in the Indenture without the consent of Holders
of the Notes issued thereunder.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall, in accordance with Section 5-1401
of the General Obligations Law of the State of New York, be construed in
accordance with the laws of the State of New York without regard to its conflict
of law provisions, and the obligations, rights and remedies of the parties
hereunder and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency herein prescribed.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of
assignee:
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _______________________________, attorney, to transfer said Note on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated: */
Signature Guaranteed:
*/
*/NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within Note in
every particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.
EXHIBIT E
---------
FORM OF CLASS A-4 NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
---
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT
INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
ANRC AUTO OWNER TRUST __________
____% ASSET-BACKED NOTE, CLASS A-4
REGISTERED $______________
No.1 CUSIP NO. ____________
ANRC Auto Owner Trust _______________, a business trust organized and
existing under the laws of the State of Delaware (the "Issuer"), for value
------
received, hereby promises to pay to Cede & Co., or registered assigns, the
principal sum of ___________________________________ ($__________), payable to
the extent described in the Indenture and the Sale and Servicing Agreement
referred to on the reverse hereof on each Distribution Date; provided that the
--------
entire unpaid principal amount of this Note shall be payable on the earlier of
the Distribution Date occurring in _________________________ (the "Class A-4
---------
Final Scheduled Distribution Date") and the Redemption Date, if any, selected
---------------------------------
pursuant to the Indenture. No payments of principal of the Class A-4 Notes
shall be made until the principal amount of the Class A-1 Notes, the Class A-2
Notes and the Class A-3 Notes has been reduced to zero.
The Issuer will pay interest on this Note at the Class A-4 Note Rate
shown above on each Distribution Date until the principal of this Note is paid
or made available for payment, on the principal amount of this Note outstanding
on the preceding Distribution Date (after giving effect to all payments of
principal made on the preceding
Distribution Date), or on the Closing Date in the case of the first Distribution
Date, subject to certain limitations contained in the Indenture. Interest on
this Note will accrue for each Distribution Date during the period (the
"Interest Accrual Period" with respect to such Distribution Date) from and
-----------------------
including the Distribution Date immediately preceding such Distribution Date
(or, in the case of the first Distribution Date, from and including the Closing
Date) to but excluding such Distribution Date. The Issuer shall pay interest on
overdue installments of interest at the Class A-4 Note Rate to the extent
lawful. Interest will be computed on the basis of a 360-day year of twelve 30-
day months. Such principal of and interest on this Note shall be paid in the
manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Insurance Policy") issued by ___________ (the "Insurer"),
---------------- ------------
pursuant to which the Insurer has unconditionally guaranteed payment of the Note
Interest Distributable Amount on each Distribution Date and the Guaranteed Note
Principal Amount of the Notes all as more fully set forth in the Insurance
Policy.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture referred to on the
reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of
assignee:
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _______________________________, attorney, to transfer said Note on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated: */
Signature Guaranteed:
*/
*/NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within Note in
every particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by an Authorized Officer, as set forth below.
Date: ______________, _____ ANRC AUTO OWNER TRUST _________________
By:____________________________________,
not in its individual capacity, but
solely as Owner Trustee
By:____________________________________,
Name:
Title:
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
_______________________________, as
Indenture Trustee
By:________________________________
Authorized Signatory
[REVERSE OF CLASS A-4 NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its "____% Asset-Backed Notes, Class A-4" (the "Class A-4 Notes"),
---------------
all issued under the Indenture, dated as of ______________, ____ (as amended,
supplemented or otherwise modified and in effect from time to time, the
"Indenture"), between the Issuer and _______________________________, as
---------
indenture trustee (the "Indenture Trustee"), to which Indenture and all
-----------------
indentures supplemental thereto reference is hereby made for a statement of the
respective rights and obligations thereunder of the Issuer, the Insurer, the
Indenture Trustee and the Holders of the Notes. The Notes are subject to all
terms of the Indenture. All terms used in this Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended, and if not
defined therein, in the Sale and Servicing Agreement (as defined in the
Indenture).
The Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and the Class ▇-
▇ Notes (collectively, the "Notes") are and will be equally and ratably secured
-----
by the collateral pledged as security therefor as provided in the Indenture.
Principal payable on the Class A-4 Notes will be paid on each
Distribution Date in the amount specified in the Indenture and the Sale and
Servicing Agreement. As described above, the entire unpaid principal amount of
this Note will be payable on the earlier of the Class A-4 Final Scheduled
Distribution Date and the Redemption Date, if any, selected pursuant to the
Indenture. Notwithstanding the foregoing, under certain circumstances, the
entire unpaid principal amount of the Class A-4 Notes shall be due and payable
following the occurrence and continuance of an Event of Default, as described in
the Indenture. All principal payments on the Class A-4 Notes shall be made pro
---
rata to the Class A-4 Noteholders entitled thereto.
----
Payments of principal and interest on this Note due and payable on
each Distribution Date or Redemption Date shall be made by check mailed to the
Person whose name appears as the registered Holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on the
related Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such nominee
to be Cede & Co.), payments will be made by wire transfer in immediately
available funds to the account designated by such nominee. Such checks shall be
mailed to the Person entitled thereto at the address of such Person as it
appears on the Note Register as of the applicable Record Date without requiring
that this Note be submitted for notation of payment. Any reduction in the
principal amount of this Note (or any one or more Predecessor Notes) affected by
any payments made on any Distribution Date or Redemption Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not noted hereon. If funds are expected to be available, as provided in the
Indenture, for payment in full of the remaining unpaid principal amount of this
Note on a Distribution Date or Redemption Date, then the Indenture Trustee, in
the name of and on behalf of the Issuer, will notify the Person who was the
registered Holder hereof as of the Record Date preceding such
Distribution Date or Redemption Date by notice mailed within five days of such
Distribution Date or Redemption Date and the amount then due and payable shall
be payable only upon presentation and surrender of this Note at the Corporate
Trust Office of the Indenture Trustee or at the office of the Indenture
Trustee's agent appointed for such purposes located in The City of New York.
As provided in the Indenture, the Notes are subject to redemption in
whole, but not in part, on any Distribution Date as of which the Pool Balance is
less than or equal to 10% of the Original Pool Balance.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or Agency
designated by the Issuer pursuant to the Indenture. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such registration
of transfer or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under
the Indenture or any certificate or other writing delivered in connection
therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Indenture Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary shall be
fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that by
accepting the benefits of the Indenture and such Note that such Noteholder or
Note Owner will not at any time institute against the Seller or the Issuer, or
join in any institution against the Seller or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States Federal or state bankruptcy or similar law.
The Issuer has entered into the Indenture, and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness secured by
the Collateral. Each Noteholder, by acceptance of a Note (and each Note Owner
by acceptance of a beneficial interest in a Note), agrees to treat the Notes for
federal, state and local income, single business and franchise tax purposes as
indebtedness.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and the Insurer and any agent of the
Issuer, the Indenture Trustee or the Insurer may treat the Person in whose name
this Note (as of the day of determination or as of such other date as may be
specified in the Indenture) is registered as the owner hereof for all purposes,
whether or not this Note be overdue, and neither the Issuer, the Indenture
Trustee, the Insurer nor any such agent shall be affected by notice to the
contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Insurer and, so long as an Insurer
Default has occurred and is continuing, of the Holders of Notes representing not
less than a majority of the Outstanding Principal Amount of the Notes. The
Indenture also contains provisions permitting the Insurer and, so long as an
Insurer Default has occurred and is continuing, the Indenture Trustee or the
Holders of Notes representing specified percentages of the Outstanding Principal
Amount of the Notes, on behalf of the Holders of all the Notes, to waive
compliance by the Issuer with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Insurer or Holder of this Note (or any one of more Predecessor
Notes) shall be conclusive and binding upon such Insurer or Holder and upon all
future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note. The Indenture also permits
the Indenture Trustee with the consent of the Insurer to amend or waive certain
terms and conditions set forth in the Indenture without the consent of Holders
of the Notes issued thereunder.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall, in accordance with Section 5-1401
of the General Obligations Law of the State of New York, be construed in
accordance with the laws of the State of New York without regard to its conflict
of law provisions, and the obligations, rights and remedies of the parties
hereunder and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency herein prescribed.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of
assignee:
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _______________________, attorney, to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: */
Signature Guaranteed:
*/
*/NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within Note in
every particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.