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HONDA TITLING D LLC
LIMITED LIABILITY COMPANY AGREEMENT
Between
AMERICAN HONDA FINANCE CORPORATION
and
HONDA FUNDING INC.
as Members
Dated as of May __, 1999
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TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Other Definitional Provisions. . . . . . . . . . . . . . . . 3
ARTICLE TWO
ORGANIZATION OF COMPANY
Section 2.01. Formation. . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.02. Name and Office. . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.03. Duration.. . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.04. Registered Office and Registered Agent.. . . . . . . . . . . 4
Section 2.05. Execution, Delivery and Filing of Certificate. . . . . . . . 4
ARTICLE THREE
PURPOSES
Section 3.01. Purposes.. . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 3.02. Power and Authority. . . . . . . . . . . . . . . . . . . . . 5
Section 3.03. Limitations on Powers. . . . . . . . . . . . . . . . . . . . 5
Section 3.04. Company Opportunity. . . . . . . . . . . . . . . . . . . . . 6
ARTICLE FOUR
CAPITAL CONTRIBUTIONS; BORROWINGS
Section 4.01. Admission and Initial Contributions of Members.. . . . . . . 6
Section 4.02. Additional Capital Contributions.. . . . . . . . . . . . . . 6
Section 4.03. Withdrawals. . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.04. Borrowings.. . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.05. Additional Members.. . . . . . . . . . . . . . . . . . . . . 7
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MANAGEMENT
Section 5.01. Powers of the Members. . . . . . . . . . . . . . . . . . . . 7
Section 5.02. Limitations on Powers of Members.. . . . . . . . . . . . . . 8
Section 5.03. Self Dealing.. . . . . . . . . . . . . . . . . . . . . . . . 8
Section 5.04. Standard of Care; Liability. . . . . . . . . . . . . . . . . 8
Section 5.05. Compensation.. . . . . . . . . . . . . . . . . . . . . . . . 9
Section 5.06. Meetings of Members. . . . . . . . . . . . . . . . . . . . . 9
Section 5.07. Consent. . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 5.08. Independent Member.. . . . . . . . . . . . . . . . . . . . . 9
Section 5.09. Managers.. . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE SIX
POWER TO INSTITUTE BANKRUPTCY OR INSOLVENCY PROCEEDINGS
Section 6.01. Unanimous Vote Required. . . . . . . . . . . . . . . . . . . 10
Section 6.02. Voting on Bankruptcy or Insolvency.. . . . . . . . . . . . . 10
ARTICLE SEVEN
CAPITAL ACCOUNTS; PROFITS AND LOSSES; DISTRIBUTIONS
Section 7.01. Capital Accounts.. . . . . . . . . . . . . . . . . . . . . . 10
Section 7.02. Allocation of Profits and Losses.. . . . . . . . . . . . . . 11
Section 7.03. Distributions. . . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE EIGHT
EXCULPATION OF LIABILITY; INDEMNIFICATION
Section 8.01. Exculpation of Liability.. . . . . . . . . . . . . . . . . . 11
Section 8.02. Indemnification. . . . . . . . . . . . . . . . . . . . . . . 11
Section 8.03. Fiduciary Duty.. . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE NINE
TERM OF COMPANY
Section 9.01. Commencement.. . . . . . . . . . . . . . . . . . . . . . . . 12
Section 9.02. Dissolution. . . . . . . . . . . . . . . . . . . . . . . . . 12
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ARTICLE TEN
APPLICATION OF ASSETS
Section 10.01. Application of Assets. . . . . . . . . . . . . . . . . . . . 12
Section 10.02. Termination. . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 10.03. Claims of the Members. . . . . . . . . . . . . . . . . . . . 13
ARTICLE ELEVEN
RESTRICTION ON TRANSFERS OF INTERESTS
Section 11.01. Restriction on Transfers of Interests. . . . . . . . . . . . 13
ARTICLE TWELVE
INVESTMENT REPRESENTATION
Section 12.01. Investment Representation. . . . . . . . . . . . . . . . . . 13
ARTICLE THIRTEEN
MISCELLANEOUS PROVISIONS
Section 13.01. Limitations on Amendment.. . . . . . . . . . . . . . . . . . 13
Section 13.02. Books of Account; Reports. . . . . . . . . . . . . . . . . . 14
Section 13.03. Bank Accounts and Investment of Funds. . . . . . . . . . . . 14
Section 13.04. Accounting Decisions.. . . . . . . . . . . . . . . . . . . . 14
Section 13.05. Federal Income Tax Elections.. . . . . . . . . . . . . . . . 14
Section 13.06. Entire Agreement.. . . . . . . . . . . . . . . . . . . . . . 14
Section 13.07. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 13.08. Consent of Members.. . . . . . . . . . . . . . . . . . . . . 15
Section 13.09. Further Execution. . . . . . . . . . . . . . . . . . . . . . 15
Section 13.10. Binding Effect.. . . . . . . . . . . . . . . . . . . . . . . 15
Section 13.11. Severability.. . . . . . . . . . . . . . . . . . . . . . . . 15
Section 13.12. Captions.. . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 13.13. Counterparts.. . . . . . . . . . . . . . . . . . . . . . . . 15
Section 13.14. Delaware Law to Control. . . . . . . . . . . . . . . . . . . 16
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EXHIBITS
Exhibit A - Members; Capital Contributions; Membership Percentages . . .A-1
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This Limited Liability Company Agreement of Honda Titling D LLC, a
Delaware limited liability company (the "Company"), dated as of May __, 1999, is
between American Honda Finance Corporation ("AHFC"), a California corporation,
and Honda Funding Inc., a Delaware corporation (the "Independent Member" and,
together with AHFC, the "Members"); and
WHEREAS, the Members desire to form a limited liability company under
and pursuant to the Delaware Limited Liability Company Act for the purposes set
forth in this Agreement by causing a Certificate of Formation of the Company to
be filed with the office of the Secretary of State of the State of Delaware and
by entering into this Agreement;
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree to form the Company in accordance with the Delaware
Limited Liability Company Act and subject to the terms and provisions of this
Agreement.
ARTICLE ONE
DEFINITIONS
Section 1.01. DEFINITIONS. As used in this Agreement, the following
terms shall have the following meanings:
"ACT" means the Delaware Limited Liability Company Act (6 DEL. C.
Section 18-101, ET SEQ.), as amended from time to time.
"AFFILIATE" of any Person means any other Person that (i) directly or
indirectly controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any employee benefit plan) or (ii) is an officer or director of
such Person. For purposes of this definition, a Person shall be deemed to be
"controlled by" another Person if such other person possesses, directly or
indirectly, the power (i) to vote 5% or more of the securities (on a fully
diluted basis) having ordinary voting power for the election of directors,
members or managing partners of such Person or (ii) to direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.
"AGREEMENT" means this Limited Liability Company Agreement of the
Company, as it may be amended, restated or supplemented from time to time.
"CAPITAL ACCOUNTS" shall have the meaning set forth in Section 7.01.
"CAPITAL CONTRIBUTIONS" means the amount of all cash, money, and notes
payable on demand and the agreed upon value of other property or services
contributed by the Members to the Company.
"CERTIFICATE" means the Certificate of Formation of the Company,
including any restatements thereof or amendments thereto, which are filed with
the Delaware Secretary of State.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL" shall have the meaning set forth in Section 3.01(b).
"COVERED PERSON" shall have the meaning set forth in Section 8.03.
"DELAWARE SECRETARY OF STATE" means the Secretary of State of the State
of Delaware.
"FISCAL YEAR" means the taxable year of the holder of the Majority
Interest.
"INDEPENDENT DIRECTOR" means an individual who is not (i) a director,
officer or employee of AHFC or any Affiliate of AHFC (other than any limited or
special purpose corporation or limited liability company similar to the
Company); (ii) a person related to any officer or director of AHFC or any
Affiliate of AHFC; (iii) a direct or indirect holder of more than 10% of any
voting securities of AHFC or any Affiliate of AHFC; or (iv) a person related to
a direct or indirect holder of more than 10% of any voting securities of AHFC or
any Affiliate of AHFC.
"INDEPENDENT MEMBER" shall have the meaning set forth in Section 5.08.
"MAJORITY INTEREST" means the interest in the Company of AHFC.
"MAJORITY OF THE REMAINING MEMBERS" means those Members holding more
than 50% of the Membership Percentages and more than 50% of the Capital Account
balances of the Members.
"MANAGERS" means Honda Funding Inc. and such other persons or entities
that may be designated from time to time by the Members as managers of the
Company to perform such functions for the Company as may be determined from time
to time by the Members. A Manager shall be deemed to be a "manager" of the
Company within the meaning of Section 18-101 of the Act.
"MEMBERS" means the persons or entities designated as Members of the
Company in Exhibit A. Any reference to a Member shall, unless the context
clearly requires otherwise, include a reference to its predecessors and
successors in interest.
"MEMBERSHIP PERCENTAGES" means the Members' respective limited liability
company interests in the Company as set forth in Exhibit A.
"ORIGINATION TRUST" means Honda Lease Trust, a Delaware business trust.
"PERSON" means any legal person, including any individual, partnership,
corporation, trust, bank, trust company, limited liability company, limited
liability partnership, joint stock company, association, joint venture, estate
(including any beneficiaries), unincorporated organization or government or any
agency or potential subdivision thereof.
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"PROFITS" and "LOSSES" mean the Company's taxable income or loss for
each Fiscal Year (or other period) determined in accordance with the accounting
methods followed by the Company for federal income tax purposes, except that any
income of the Company that is exempt from federal income tax and not otherwise
taken into account in computing Profits and Losses shall be added to such
taxable income or loss.
"RECEIVABLES" shall have the meaning set forth in Section 3.01(a).
"SECURITIES" shall have the meaning set forth in Section 3.01(d).
"SUBI" shall have the meaning set forth in Section 3.01(c).
"TRUST" shall have the meaning set forth in Section 3.01(c).
"TRUSTEE" shall have the meaning set forth in Section 6.01.
"UTI" shall have the meaning set forth in Section 3.01(c).
Section 1.02. OTHER DEFINITIONAL PROVISIONS.
(a) For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, (i) terms used herein
include, as appropriate, all genders and the plural as well as the singular,
(ii) references to this Agreement include all Exhibits hereto, (iii) references
to words such as "herein" and "hereof" shall refer to this Agreement as a whole
and not to any particular part, Article or Section herein, (iv) references to an
Article or Section such as "Article One" or "Section 1.01" shall refer to the
applicable Article or Section of this Agreement, (v) the term "include" and all
variations thereof shall mean "include without limitation", (vi) the term "or"
shall include "and/or" and (vii) the term "proceeds" shall have the meaning
ascribed to such term in the Uniform Commercial Code, as adopted by and in
effect in the State of Delaware.
(b) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate or
other document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles in effect from time
to time. To the extent that the definitions of accounting terms in this
Agreement or in any such certificate or other document are inconsistent with the
meanings of such terms under such generally accepted accounting principles, the
definitions contained in this Agreement or in any such certificate or other
document shall control.
ARTICLE TWO
ORGANIZATION OF COMPANY
Section 2.01. FORMATION. The parties hereto hereby form a limited
liability company pursuant to the provisions of the Act and this Agreement, and
agree that the rights, duties and
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liabilities of the Members and Managers shall be as provided in the Act,
except as otherwise provided in this Agreement. Pursuant to Section 18-201(d)
of the Act, this Agreement shall become effective as of the formation of the
Company.
Section 2.02. NAME AND OFFICE. The name of the Company shall be Honda
Titling D LLC, and its office shall be located at ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or such other place as the Members may determine from time to
time.
Section 2.03. DURATION. The term of the Company shall commence on the
date the Certificate is filed in the office of the Delaware Secretary of State
and shall continue until March 31, 2027, unless the Company is dissolved before
such date in accordance with the provisions of this Agreement. The existence of
the Company as a separate legal entity shall continue until cancellation of the
Certificate in the manner required by the Act.
Section 2.04. REGISTERED OFFICE AND REGISTERED AGENT. The Company's
initial registered office shall be at the office of its registered agent at
Corporation Trust Center, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and the
name of its initial registered agent at such address shall be The Corporation
Trust Company. The registered office and registered agent may be changed from
time to time in accordance with the Act. If the registered agent shall ever
resign, the Company shall promptly appoint a successor.
Section 2.05. EXECUTION, DELIVERY AND FILING OF CERTIFICATE. ▇.
▇▇▇▇▇▇, or such person as designated by ▇. ▇▇▇▇▇▇, as an "authorized person"
within the meaning of the Act, shall execute, deliver and file the Certificate
with the Delaware Secretary of State.
ARTICLE THREE
PURPOSES
Section 3.01. PURPOSES. The purposes for which the Company is formed
are to, solely in its capacity as General Partner of Honda Titling D L.P.:
(a) acquire, own, hold, service, sell, assign, pledge,
finance, refinance and otherwise deal with from time to time (i) motor
vehicle leases; (ii) installment obligations relating to motor vehicles;
(iii) motor vehicle retail installment sale or conditional sale
contracts; (iv) motor vehicle wholesale inventory loans or sales
contracts secured by, among other things, new or used motor vehicles;
(v) dealer rental car loans or sales contracts including dealer rental
car loans or sales contracts secured by, among other things, new or used
motor vehicles; (vi) receivables, including any right to payment from a
person or entity, whether constituting an account, chattel paper,
instrument or general intangible, arising out of or relating to the sale
of new or used motor vehicles or related products and supplies;
(vii) interests in any of the foregoing; and (viii) any proceeds or
other monies due under any of the foregoing, any related fees and
charges, security interests in the foregoing or other property securing
payment thereof and related agreements, instruments, documents and
rights (collectively, the "Receivables");
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(b) acquire, own, hold, service, sell, assign, pledge,
finance, refinance and otherwise deal with Receivables, any collateral
securing the Receivables, all related insurance policies, related
agreements with Affiliates, agreements with motor vehicle dealers,
manufacturers and lessors and other originators or servicers of
Receivables and any proceeds or further rights associated therewith
(collectively, the "Collateral");
(c) sell, assign, pledge or otherwise transfer Receivables,
Collateral, Securities and notes or beneficial interests in any of the
foregoing, undivided trust interests ("UTIs") and special units of
beneficial interests ("SUBIs") of the Origination Trust to trusts or
other entities established by or on behalf of the Company or one of its
Affiliates (each, a "Trust") or to Affiliates of the Company;
(d) authorize, sell and deliver or participate in the
issuance of one or more series or classes of participation certificates,
bonds, notes or other evidences of interest or indebtedness
(collectively, "Securities"), in either case issued by Trusts;
(e) acquire Securities, UTIs or SUBIs or other property of a
Trust, including remainder interests in collateral or reserve accounts;
(f) issue, authorize, sell and deliver Securities, UTIs,
SUBIs or other instruments secured, Collateral collateralized by or
evidencing beneficial interests in Receivables or Securities;
(g) hold, and to enjoy all of the rights and privileges as a
holder or beneficial owner of, any Securities, Collateral, UTIs or
SUBIs;
(h) negotiate, authorize, execute, deliver or assume or
perform the obligations under any agreement, instrument or document
relating to the activities set forth in subsections (a) through (g)
above, including but not limited to any trust agreement, sale and
servicing agreement, pooling and servicing agreement, indenture,
reimbursement agreement, credit support agreement, receivables purchase
agreement, indemnification agreement, placement agreement, underwriting
agreement or any other documents or agreements contemplated thereby or
specifically described therein;
(i) on its own behalf or on behalf of Honda Titling D L.P.,
to bring and defend actions and proceedings at law or in equity or
before any court or governmental, administrative or other regulatory
agency, body or commission;
(j) on its own behalf or on behalf of Honda Titling D L.P.,
to open, maintain and close bank, brokerage and other accounts and to
pay fees and changes applicable to transactions related thereto;
(k) to issue membership interests as provided for herein; and
(l) engage in any activity and to exercise any powers
permitted to limited liability companies under the laws of the State of
Delaware that are related or incidental to the foregoing and necessary,
convenient or advisable to accomplish the foregoing.
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Section 3.02. POWER AND AUTHORITY. In its capacity as General Partner
of Honda Titling D L.P., the Company shall have the power and authority to take
any and all actions necessary, appropriate, proper, advisable, incidental or
convenient to accomplish or for the furtherance of the purposes set forth in
Section 3.01. The Company shall serve as a General Partner of Honda Titling D
L.P. The Company, and Honda Funding Inc. or ▇. ▇▇▇▇▇▇, on behalf of the
Company, shall enter into and perform the Limited Partnership Agreement of Honda
Titling D L.P. without any further act, vote or approval of any Member, Manager
or other person, notwithstanding any other provision of this Agreement, the Act
or other applicable law, rule or regulation.
Section 3.03. LIMITATIONS ON POWERS. Notwithstanding any other
provision of this Agreement and any provision of law, the Company shall not do
any of the following:
(a) engage in any business or activity other than as set
forth in this Agreement;
(b) without the unanimous affirmative vote of the Members,
(i) merge or consolidate with or into any other Person, (ii) act other
than in the Company's own name, (iii) dissolve or liquidate, in whole or
in part, or institute proceedings to be adjudicated bankrupt or
insolvent, (iv) consent to the institution of bankruptcy or insolvency
proceedings against it, (v) file a petition seeking or consent for
reorganization or relief under any applicable federal or state law
relating to bankruptcy, (vi) consent to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator or other similar official of
the Company or all or a substantial part of its property, (vii) make any
assignment for the benefit of creditors, (viii) admit in writing its
inability to pay its debts generally as they become due; (ix) institute
or join in any institution of, any bankruptcy, insolvency, liquidation,
reorganization or arrangement proceedings or other proceedings under any
federal or state bankruptcy or similar law, against any entity in which
the Company holds an ownership interest; or (x) take any limited
liability company action in furtherance of the actions set forth in
clauses (i) through (ix) above;
(c) without the unanimous affirmative vote of the Members,
take or cause to be taken any of the actions referred to in clauses (i)
through (vii) of subparagraph (b) above with respect to any entity of
which the Company is a partner or member or any entity of which such
partner or member is, in turn, a partner or member (each such entity
being referred to as a "Downstream Entity");
(d) without the unanimous affirmative vote of the Members,
merge or consolidate with any other corporation, company or entity or
sell all or substantially all of its assets or acquire all or
substantially all of the assets or capital stock or other ownership
interest of any other corporation, company or entity; or
(e) without the unanimous affirmative vote of the Members,
(i) amend, modify or terminate or cause to be amended, modified or
terminated, the organizational documents of any Downstream Entity,
(ii) cause any Downstream Entity to hold property other than in such
entity's own name, (iii) take any action or cause to be taken any action
with respect to the dissolution or winding up of any Downstream Entity,
except as
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permitted in such Downstream Entity's organizational documents,
or elect not to continue such Downstream Entity's business; or
(f) take or cause to be taken any action not otherwise
permitted under the organizational documents of any Downstream Entity.
Section 3.04. COMPANY OPPORTUNITY. No Member need afford the Company
or any other Member the opportunity of investing or otherwise participating in
any other enterprise, regardless of whether such enterprises, but for this
sentence, would be deemed an opportunity of the Company. Nothing in this
Agreement shall prohibit any Member from engaging in any other business
activity, whether or not competitive with, similar to, or within the scope of
the activities conducted by or on behalf of, the Company.
ARTICLE FOUR
CAPITAL CONTRIBUTIONS; BORROWINGS
Section 4.01. ADMISSION AND INITIAL CONTRIBUTIONS OF MEMBERS.
(a) Each of AHFC and the Independent Member shall be admitted as a
member of the Company at the time such entity (i) executes this Agreement or a
counterpart signature page to this Agreement and (ii) is listed as a Member on
Exhibit A attached hereto.
(b) The Members shall make the Capital Contributions set forth next
to their names in Exhibit A upon the formation of the Company. No interest
shall accrue on any Capital Contribution made to the Company.
Section 4.02. ADDITIONAL CAPITAL CONTRIBUTIONS. The Members shall not
be obligated to make additional Capital Contributions except with the consent of
all Members.
Section 4.03. WITHDRAWALS. No Member shall be entitled to be repaid
any portion of its Capital Account or withdraw from the Company without the
consent of all Members or as otherwise provided in this Agreement.
Section 4.04. BORROWINGS. The Company may borrow sums to be used for
any of the business purposes described in Section 3.01; provided, however, that
any such borrowing shall require the prior approval of a Majority Interest and
shall not be prohibited by this Agreement, any applicable law, regulation or
agreement. Any Member may advance such sums to the Company as approved in
writing by a Majority Interest. Any amounts borrowed from a Member shall not
constitute a contribution to the capital of the Company but shall constitute a
debt of the Company which shall be repaid before any distributions to the
Members.
Section 4.05. ADDITIONAL MEMBERS. No additional Members shall be
admitted to the Company without the unanimous consent of the Members.
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ARTICLE FIVE
MANAGEMENT
Section 5.01. POWERS OF THE MEMBERS.
(a) The Company shall be managed by its Members. Subject to the
other provisions of this Article and Article Six, each Member shall have the
authority, on behalf of the Company, to do all things necessary or appropriate
for the accomplishment of the purposes of the Company, including, but not
limited to, (i) acquiring and selling, assigning and transferring installment
obligations, leases, retail installment sale or conditional sale contracts,
inventory loans, motor vehicle wholesale inventory sales contracts, dealer
rental car loans or sales contracts, promissory notes, security agreements and
receivables; (ii) disbursing Company funds for Company purposes; (iii) investing
and reinvesting Company funds; (iv) executing contracts, notes, mortgages and
other agreements and instruments; (v) employing attorneys, accountants, Managers
or other agents, which may include Affiliates of the Company; (vi) paying all
Company obligations; (vii) performing all ministerial acts and duties relating
to the payment of all indebtedness, taxes and assessments due or to become due
with regard to any property of the Company; (viii) purchasing and maintaining
insurance on behalf of the Company against any liability or expense asserted
against or incurred by or on behalf of the Company; (ix) transacting the
Company's business under an assumed name or name other than its name as set
forth in the Certificate; (x) appointing any Member or other person as agent for
service of process on the Company as required by the law of any jurisdiction in
which the Company transacts business; (xi) commencing, prosecuting or defending
any proceeding in the Company's name; and (xii) doing such other acts as may
facilitate the Company's exercise of its powers; provided, however, that all
such acts shall fall within the purposes of the Company set forth in Section
3.01.
(b) Notwithstanding anything in this Agreement to the contrary, the
Company shall at all times have at least one Independent Member, and no action
of the type described in Article Six shall occur without the consent of each
Independent Member.
(c) Each Member irrevocably appoints the other Members as its
attorney-in-fact on its behalf and in its stead to execute and swear to any
amendment to the Certificate and file any writing, and to give any notice which
may be required by any rule or law and which may be necessary or appropriate in
order to effect any action by or on behalf of the Company or the Members taken
as provided in this Agreement or which may be necessary or appropriate to
correct any errors or omissions. This power of attorney is coupled with an
interest and shall not be revoked by the act of any Member. This power of
attorney shall survive and not be affected by an assignment by any Member of its
limited liability company interest in the Company; provided, however, that where
a Member's entire limited liability company interest is assigned to an assignee
who becomes a substitute Member in its stead, such power shall survive for the
sole purpose of enabling such Member to effect such substitution. Each Member
shall provide seven days' prior written notice of actions to be taken as
attorney-in-fact on behalf of another Member and the acting Member shall be
authorized to take such actions unless the other Member objects in writing
during such notice period.
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(d) The Members shall not, and shall not allow the Company otherwise
to (i) commingle any funds or other assets of the Company with the funds or
assets of any other Person, (ii) perform the obligations of another Person,
(iii) guarantee the obligations of another Person, (iv) pledge the assets of
another Person or (v) enter into transactions with any Person except as
specifically authorized and contemplated in this Agreement and related
agreements. The Company shall (A) conduct business in its own name and hold
itself out as a separate entity, (B) maintain a separate office location or, if
the Company shares office space with others, pay its fair allocable share of
overhead costs and (C) observe all organizational formalities. The bank
accounts, financial and accounting books, records and financial statements of
the Company shall be maintained separate from those of every other Person. All
obligations and indebtedness of any kind incurred by the Company shall be paid
from the assets of the Company and the Company's assets shall not be used to pay
any obligation or indebtedness of any other Person, other than certain expenses,
obligations or indebtedness of the Origination Trust and any trustee of any of
the foregoing with respect to transactions of or with respect to such Trust or
as set forth in Section 3.01 herein.
(e) A copy of the Certificate or amendments to the Certificate will
be provided to each Member upon written request to the Company.
(f) Subject to the other provisions of this Article and Article Six,
the Members shall have full power to act for and to bind the Company to the
extent provided by Delaware law. Every contract, note, mortgage, lease, deed or
other instrument or agreement executed by any Member shall be conclusive
evidence that at the time of execution the Company was then in existence, that
this Agreement had not theretofore been terminated or amended in any manner and
that the execution and delivery of such instrument was duly authorized by the
Members. A Manager may bind the Company only to the extent authorized by the
Members.
Section 5.02. LIMITATIONS ON POWERS OF MEMBERS. Notwithstanding any
other provision of this Agreement, no act shall be taken, sum expended, decision
made, obligation incurred or power exercised by any Member on behalf of the
Company without prior written notice to all Members outlining the proposed
action followed by the written consent of a Majority Interest with respect to:
(i) any mortgage, grant of security interest, pledge or encumbrance of any asset
of the Company; (ii) any merger of the Company with another entity; (iii) any
transaction involving an actual or potential conflict of interest between a
Member and the Company; (iv) any material change in the character of the
business and affairs of the Company; or (v) any act that would contravene in a
material respect any provision of this Agreement or the Act.
Section 5.03. SELF DEALING. Any Member and any Affiliate thereof may
deal with the Company, directly or indirectly, as vendor, purchaser, employee,
agent or otherwise. No contract or other act of the Company shall be voidable
or affected in any manner by the fact that a Member or an Affiliate thereof is
directly or indirectly interested in such contract or other act apart from its
interest as a Member, nor shall any Member or an Affiliate thereof be
accountable to the Company or the other Members in respect of any profits
directly or indirectly realized by reason of such contract or other act, and
such interested Member shall be eligible to vote or take any other action as a
Member in respect of such contract or other act as it would be entitled were it
or its Affiliate not interested therein. Notwithstanding the foregoing, (i) any
direct or indirect interest of a Member or an Affiliate thereof in any contract
or other act, other than its interest as
9
a Member, shall be disclosed to all other Members, (ii) such contract or
other act shall be approved by a Majority Interest unless the same is
specifically authorized herein and (iii) the Members shall not receive or
hold any property of the Company as collateral security in respect of any
claim against the Company.
Section 5.04. STANDARD OF CARE; LIABILITY. Each Member and its
respective directors, officers, stockholders and Affiliates shall discharge its
duties in good faith, with the care an ordinarily prudent person in a like
position would exercise under similar circumstances, and in a manner he
reasonably believes to be in the best interests of the Company as required by
this Agreement or the Act. A Member shall not be liable for monetary damages to
the Company for any breach of any such duties except for receipt of a financial
benefit to which the Member is not entitled, voting for or assenting to a
distribution to Members in violation of this Agreement or the Act, or a knowing
violation of the law.
Section 5.05. COMPENSATION. The Company shall reimburse each Member
for any reasonable out-of-pocket expenses incurred on behalf of the Company. In
addition, any Member may receive reasonable compensation for any services
rendered to the Company approved by the Majority Interest.
Section 5.06. MEETINGS OF MEMBERS. All Members shall be entitled to
vote on any matter submitted to a vote of the Members. Unless a greater vote is
required by the Act or this Agreement, the affirmative vote of a Majority
Interest shall be required. Meetings of Members for the transaction of such
business as may properly come before the Members may be held at such place, on
such date and at such time as the Majority Interest shall determine. Special
meetings of Members for any proper purpose or purposes may be called at any time
by the holders of at least 25% of the Membership Percentages of all Members.
The Company shall deliver or mail written notice stating the date, time, place
and purposes of any meeting to each Member entitled to vote at the meeting.
Such notice shall be given not less than 10 nor more than 60 days before the
date of the meeting.
Section 5.07. CONSENT. Any action required or permitted to be taken at
an annual or special meeting of the Members may be taken without a meeting, if
the Members unanimously consent, in writing, to take the proposed action. Every
written consent shall bear the date of consent in lieu of meeting and the
signature of each Member who signs the consent.
Section 5.08. INDEPENDENT MEMBER. The Company shall at all times have
at least one Member (each, an "Independent Member") that shall be a special
purpose corporation formed pursuant to a charter or articles of incorporation
that (i) limits its business purposes and activities and (ii) requires the
unanimous consent of its entire board of directors (without any vacancies),
including the affirmative vote of all Independent Directors before such member
may approve, permit or take any action, or cause any action to be taken in
respect of the following actions with respect to any limited liability company
of which it is a member, to (a) institute proceedings to have itself adjudicated
bankrupt or insolvent, (b) consent to the institution of bankruptcy or
insolvency proceedings against it, (c) file a petition seeking, or consent to,
such member's or limited liability company's reorganization or relief under any
applicable federal or state law relating to bankruptcy, (d) consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator or other
similar official of such member or limited liability company or all or a
10
substantial part of its property, (e) make any assignment for the benefit of its
creditors, admit in writing its inability to pay its debts generally as they
become due, (f) institute, or join in any institution of, any bankruptcy,
insolvency, liquidation, reorganization or arrangement proceedings or other
proceedings under any federal or state bankruptcy or similar law, against any
entity in which such member or limited liability company holds an ownership
interest or (g) take any action in furtherance of the actions set forth in
clauses (a) through (f) above.
Section 5.09. MANAGERS. Except as otherwise provided by the Act:
(a) the debts, obligations and liabilities of the Company,
whether arising in contract, tort or otherwise, shall be solely the
debts, obligations and liabilities of the Company, and no Manager shall
be obligated personally for any such debt, obligation, or liability of
the Company solely by reason of being a Manager of the Company;
(b) no Manager shall be required to make any Capital
Contribution in the form of cash to the Company; and
(c) no Manager shall be (i) entitled to receive any Profits
or (ii) liable for any Losses.
ARTICLE SIX
POWER TO INSTITUTE BANKRUPTCY OR INSOLVENCY PROCEEDINGS
Section 6.01. UNANIMOUS VOTE REQUIRED. Notwithstanding any other
provision of this Agreement and any provision of law that otherwise so empowers
the Company, the Company shall not, without (i) the prior written consent of
each trustee from time to time (each, a "Trustee") under any pooling and
servicing agreement, indenture, trust agreement or similar agreement between the
Company, a Trustee and a servicer, if any, pursuant to which the Company shall
issue certificates and/or notes and (ii) the affirmative vote of 100% of the
Members of the Company, including the Independent Member, institute proceedings
to be adjudicated a bankrupt or insolvent or consent to the institution of
bankruptcy or insolvency proceedings against it, or file a petition seeking, or
consent to, reorganization or relief under any applicable federal or state law
relating to bankruptcy, or consent to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or all
or a substantial part of its property, or make any assignment for the benefit of
creditors, or admit in writing its inability to pay its debts generally as they
become due, or take any limited liability company action in furtherance of any
such action.
Section 6.02. VOTING ON BANKRUPTCY OR INSOLVENCY. All Members,
including each Independent Member, shall be entitled to vote on any proposal of
the type described in Section 6.01. The affirmative vote of 100% of the
Members, including each Independent Member, entitled to vote on such a proposal
shall be required for such a proposal to be adopted.
11
ARTICLE SEVEN
CAPITAL ACCOUNTS; PROFITS AND LOSSES; DISTRIBUTIONS
Section 7.01. CAPITAL ACCOUNTS. A capital account shall be maintained
for each Member (each, a "Capital Account"), to which contributions and Profits
shall be credited and against which distributions and Losses shall be charged.
Capital Accounts shall be maintained in accordance with the accounting
principles of Code Section 704 and the Treasury Regulations thereunder.
Section 7.02. ALLOCATION OF PROFITS AND LOSSES.
The Profits and Losses of the Company shall be determined as of the end
of each Fiscal Year of the Company and shall be allocated to AHFC. Honda
Funding Inc. will have no interest in the Profits and Losses.
Section 7.03. DISTRIBUTIONS.
(a) The Company shall distribute to AHFC such sums as the Majority
Interest determines to be available for distribution and not required to provide
for current or anticipated Company needs. All distributions shall be made to
AHFC.
(b) No distributions shall be declared and paid unless, after the
distribution is made, the Company would be able to pay its debts as they become
due in the usual course of business and the assets of the Company are in excess
of the sum of (i) the Company's liabilities, plus (ii) the amount that would be
needed to satisfy the preferential rights of other Members upon dissolution that
are superior to the rights of the Members receiving the distribution.
(c) The Company shall not be required to make a distribution to a
Member on account of its interest in the Company if such distribution would
violate Section 18-607 of the Act or other applicable law.
ARTICLE EIGHT
EXCULPATION OF LIABILITY; INDEMNIFICATION
Section 8.01. EXCULPATION OF LIABILITY. Except as otherwise provided
by the Act, the debts, obligations and liabilities of the Company, whether
arising in contract, tort or otherwise, shall be solely the debts, obligations
and liabilities of the Company, and no Member shall be obligated personally for
any such debt, obligation or liability of the Company solely by reason of being
a Member of the Company.
Section 8.02. INDEMNIFICATION. The Company hereby agrees to indemnify
each Member, Manager, employee or agent of the Company, and each director,
officer, employee or Affiliate of each Member, who was or is a party or is
threatened to be made a party to a threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative, and
whether formal or informal (other than an action by or in the right of the
Company) by
12
reason of the fact that such person is or was a Member, employee or
agent of the Company against expenses (including reasonable attorneys' fees),
judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with the action, suit or
proceeding.
Section 8.03. FIDUCIARY DUTY. To the extent that, at law or in equity,
a Member, Manager, or agent of the Company or a director, officer, employee or
Affiliate of such person (each, a "Covered Person") has duties (including
fiduciary duties) and liabilities relating thereto to the Company or to any
other Covered Person, a Covered Person acting under this Agreement shall not be
liable to the Company or to any Member for its good faith reliance on the
provisions of this Agreement. The provisions of this Agreement, to the extent
that they restrict the duties and liabilities of a Covered Person otherwise
existing at law or in equity, are agreed by the Members to replace such other
duties and liabilities of such Covered Person.
ARTICLE NINE
TERM OF COMPANY
Section 9.01. COMMENCEMENT. The term of the Company shall commence
upon the filing of the Certificate with the Delaware Secretary of State. The
bankruptcy of a Member or the occurrence of any other event under Section 18-304
of the Act shall not cause a Member to cease to be a Member of the Company and
upon the occurrence of such an event, the business of the Company shall continue
without dissolution.
Section 9.02. DISSOLUTION. The Company shall be dissolved and its
affairs wound up upon the occurrence of any of the following events: (i) the
sale or other disposition of substantially all of the assets of the Company;
(ii) the written consent thereto of all of the Members; (iii) the retirement,
expulsion or dissolution of a Member; provided, however, that the Company shall
not dissolve and be wound up if within 90 days after such event, all remaining
Members agree in writing to continue the business of the Company and to admit
one or more Members as necessary or desired; or (iv) the entry of a decree of
judicial dissolution pursuant to Section 18-802 of the Act.
ARTICLE TEN
APPLICATION OF ASSETS
Section 10.01. APPLICATION OF ASSETS. Upon dissolution of the Company,
the Company shall cease carrying on its business and affairs and shall commence
winding up of the Company's business and affairs and complete the winding up as
soon as practicable. The Company's affairs shall be concluded by a Member or
Members selected in writing by the Majority Interest. The assets of the Company
may be liquidated or distributed in kind, as determined by the Majority
Interest, and the same shall first be applied to the payment of, or to a
reasonable reserve for the payment of, the Company's liabilities (including such
provision for contingent, conditional or unmatured liabilities as the Majority
Interest shall deem appropriate) and then to
13
AHFC. If the assets of the Company shall not be sufficient to pay all of the
liabilities of the Company, to the fullest extent permitted by the Act, no
assets of the Company may be sold or disposed of without the written consent
of all of the holders of outstanding securities issued by any trust formed in
respect of a transaction to which the Company is a party. To the extent that
Company assets cannot either be sold without undue loss or readily divided
for distribution in kind to the Members, then the Company may, as determined
by the Majority Interest, convey those assets to a trust or other suitable
holding entity established for the benefit of the Members in order to permit
the assets to be sold without undue loss and the proceeds thereof distributed
to the Members at a future date. The legal form of the holding entity, the
identity of the trustee or other fiduciary and the terms of its governing
instrument shall be determined by the Majority Interest.
Section 10.02. TERMINATION. The Company shall terminate when all the
assets of the Company, after payment of or due provision for all debts,
liabilities and obligations of the Company, shall have been distributed to AHFC
in the manner provided for in this Article and the Certificate shall have been
cancelled in the manner required by the Act.
Section 10.03. CLAIMS OF THE MEMBERS. The Members and former Members
shall look solely to the Company's assets for the return of their Capital
Contributions, and if the assets of the Company remaining after payment of or
due provision for all debts, liabilities and obligations of the Company are
insufficient to return such Capital Contributions, the Members and former
Members shall not have recourse against the Company or any other Member.
ARTICLE ELEVEN
RESTRICTION ON TRANSFERS OF INTERESTS
Section 11.01. RESTRICTION ON TRANSFERS OF INTERESTS. No Member may
assign, pledge or otherwise transfer its interest in the Company in whole or
part. Any attempt by a Member to transfer its interest shall be null and void.
ARTICLE TWELVE
INVESTMENT REPRESENTATION
Section 12.01. INVESTMENT REPRESENTATION. The Members represent to
each other and to the Company that they are acquiring their respective interests
in the Company for their own accounts, and without a view to selling or pledging
them.
ARTICLE THIRTEEN
MISCELLANEOUS PROVISIONS
Section 13.01. LIMITATIONS ON AMENDMENT. The Company shall not,
without the prior written consent of each nationally recognized rating agency
that has rated any securities issued
14
and outstanding pursuant to any pooling and servicing agreement, indenture,
trust agreement or other similar agreement entered into by the Company or any
Affiliate of the Company, amend, alter, change or repeal Article Three,
Section 5.08, Article Six or this Section. Subject to the foregoing
limitation, the Company reserves the right to amend, alter, change or repeal
any provision contained in this Agreement in the manner now or hereafter
prescribed by statute or applicable law, and all rights conferred upon
Members herein are granted subject to this reservation, provided that this
Agreement may not be amended without the affirmative vote of 100% of the
Members of the Company, including the Independent Members.
Section 13.02. BOOKS OF ACCOUNT; REPORTS.
(a) The Company shall keep true and complete books of account and
records of all Company transactions. The books of account and records shall be
kept at the principal office of the Company. The Company shall maintain at such
office (i) a list of names and addresses of all Members; (ii) a copy of the
Certificate; (iii) copies of the Company's federal, state and local income tax
returns and reports for the three most recent years; (iv) copies of this
Agreement; and (v) copies of the financial statements of the Company for the
three most recent years. Such Company records shall be available to any Member
or its designated representative during ordinary business hours at the
reasonable request and expense of such Member.
(b) The Company will use its best efforts to furnish, or cause to be
furnished, to Members the following items on the date indicated: (i) annually
by June 30, (A) an annual report consisting of an income statement for the prior
year and a balance sheet as of the year ended, and (B) Member information tax
returns (Schedule K-1), and (ii) as required, such other information concerning
the Company and the property of the Company as may be appropriate in order to
make full and fair disclosure to the Members of the current financial and
operating conditions of the Company.
Section 13.03. BANK ACCOUNTS AND INVESTMENT OF FUNDS. All funds of the
Company shall be deposited in its name in such checking accounts, savings
accounts, time deposits or certificates of deposit or shall be invested in such
other manner, as shall be designated by the Majority Interest from time to time.
Withdrawals shall be made upon such signature or signatures as the Majority
Interest may designate.
Section 13.04. ACCOUNTING DECISIONS. All decisions as to accounting
matters, except as specifically provided to the contrary herein, shall be made
by the Majority Interest in accordance with generally accepted accounting
principles consistently applied. Such decisions shall be acceptable to the
accountants retained by the Company, and the Majority Interest may rely upon the
advice of the accountants as to whether such decisions are in accordance with
generally accepted accounting principles.
Section 13.05. FEDERAL INCOME TAX ELECTIONS. The Company shall, to the
extent permitted by applicable law and regulations and upon obtaining any
necessary approval of the Commissioner of Internal Revenue, elect to use such
methods of depreciation, and make all other federal income tax elections in such
manner, as the Majority Interest determines to be most favorable to the Members.
The Majority Interest may rely upon the advice of the accountants retained by
the Company as to the availability and effect of all such elections. The
Majority
15
Interest shall elect to treat the Company as a single member entity formed as
an agent of AHFC and not as a separate corporation or partnership for federal
and applicable state income tax purposes
Section 13.06. ENTIRE AGREEMENT. This Agreement constitutes the entire
Agreement between the parties and may be modified only as provided herein. No
representations or oral or implied agreements have been made by any party hereto
or its agent, and no party to this Agreement has relied upon any representation
or agreement not set forth herein. This Agreement supersedes any and all other
agreements, either oral or written, among the Company and its Members.
Section 13.07. NOTICES. Except as provided below, all communications
and notices provided for hereunder shall be in writing (including telecopy or
electronic facsimile transmission or similar writing) and shall be given to the
other party at its address or telecopy numbers set forth on Exhibit A hereto, or
at such other address or telecopy number as such party may hereafter specify for
the purposes of notice to the other party hereto. Each such notice or other
communication shall be effective (i) if given by telecopy, upon receipt thereof,
(ii) if given by mail, three business days after the time such communication is
deposited in the mails with first-class postage prepaid or (iii) if given by any
other means, when received at the address specified in this Section.
Section 13.08. CONSENT OF MEMBERS. Various provisions of this
Agreement require or permit the consent, agreement, approval or disapproval,
written or otherwise, of the Members or some specified proportion thereof. In
any such case, the Company may give all Members written notice that any Member
who does not indicate its disapproval by written notice to the Company within a
specified period of time (not less than 30 days after mailing of the notice)
shall be deemed to have given its consent or approval to the action or event or
to have made the agreement referred to in the notice. In such event, any Member
who does not indicate its disapproval by written notice to the Company within
the time specified shall be deemed to have given its written consent, approval,
disapproval or agreement.
Section 13.09. FURTHER EXECUTION. Upon request of the Company from
time to time, the Members shall execute and swear to or acknowledge any amended
Certificate and any other writing which may be required by any rule or law or
which may be appropriate to the effecting of any action by or on behalf of the
Company or the Members which has been taken in accordance with the provisions of
this Agreement.
Section 13.10. BINDING EFFECT. This Agreement shall be binding upon
and shall inure to the benefit of the parties, their successors and permitted
assigns. None of the provisions of this Agreement shall be construed as for the
benefit of or as enforceable by any creditor of the Company or the Members or
any other person not a party to this Agreement.
Section 13.11. SEVERABILITY. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements, provisions
or terms of this Agreement and shall in no way affect the validity or
16
enforceability of the other provisions of this Agreement or of any security or
the rights of the holders thereof.
Section 13.12. CAPTIONS. All captions are for convenience only, do not
form a substantive part of this Agreement and shall not restrict or enlarge any
substantive provisions of this Agreement.
Section 13.13. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original and all of which
shall constitute one instrument. The Company shall have custody of the
counterparts executed in the aggregate by all Members.
Section 13.14. DELAWARE LAW TO CONTROL. This Agreement shall be
governed by, and all questions with respect to the construction of this
Agreement and the rights and liabilities of the parties hereto shall be
determined in accordance with, the internal laws of the State of Delaware,
without regard to any otherwise applicable principles of conflicts of laws.
* * * * *
17
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective officers as of the day and year first above
written.
AMERICAN HONDA FINANCE CORPORATION, as Member
By: /s/ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇. ▇▇▇▇▇▇
Title: President
HONDA FUNDING INC., as Independent Member
By: /s/ ▇. ▇▇▇▇▇▇
---------------------------------
Name; ▇. ▇▇▇▇▇▇
Title: President
18
EXHIBIT A
Capital Membership
Member's Name and Address Contributions Percentages
------------------------- ------------- ------------
American Honda Finance Corporation
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ $0 100%
-----------
-----------
Honda Funding Inc.
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ -0- 0%
----------- -----------
Total $0 100%
----------- -----------
----------- -----------
A-1
