EXHIBIT 4.2
-----------
EXECUTION COPY
INDENTURE
between
UACSC 2001-C OWNER TRUST
as Issuer
and
BNY MIDWEST TRUST COMPANY
as Indenture Trustee
Dated as of September 25, 2001
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE..........................3
SECTION 1.01. Definitions.....................................................3
SECTION 1.02. Incorporation by Reference of Trust Indenture Act..............16
SECTION 1.03. Rules of Construction..........................................17
ARTICLE II THE NOTES.........................................................18
SECTION 2.01. Form 18
SECTION 2.02. Execution, Authentication and Delivery.........................18
SECTION 2.03. Temporary Notes................................................19
SECTION 2.04. Registration; Registration of Transfer and Exchange............19
SECTION 2.05. Mutilated, Destroyed, Lost or Stolen Notes.....................20
SECTION 2.06. Intentionally Blank............................................21
SECTION 2.07. Payment of Principal and Interest; Defaulted Interest..........22
SECTION 2.08. Cancellation...................................................23
SECTION 2.09. Book-Entry Notes...............................................23
SECTION 2.10. Notices to Clearing Agency.....................................24
SECTION 2.11. Definitive Notes...............................................24
SECTION 2.12. Release of Pledged Assets......................................24
SECTION 2.13. Tax Treatment..................................................25
SECTION 2.14. ERISA..........................................................25
SECTION 2.15. CUSIP Numbers..................................................25
ARTICLE III COVENANTS........................................................25
SECTION 3.01. Payment of Principal and Interest..............................25
SECTION 3.02. Maintenance of Office or Agency................................26
SECTION 3.03. Money for Payments to be Held in Trust.........................26
SECTION 3.04. Existence......................................................27
SECTION 3.05. Protection of Trust Estate.....................................28
SECTION 3.06. Opinions as to Pledged Assets..................................28
SECTION 3.07. Performance of Obligations; Successor Servicer.................29
SECTION 3.08. Negative Covenants.............................................30
SECTION 3.09. Annual Statement as to Compliance..............................31
SECTION 3.10. Issuer May Consolidate, etc. Only on Certain Conditions........31
SECTION 3.11. Successor Transferee...........................................33
SECTION 3.12. No Other Business..............................................34
SECTION 3.13. Servicer's Obligations.........................................34
SECTION 3.14. Restricted Payments............................................34
SECTION 3.15. Notice of Events of Default....................................34
SECTION 3.16. Further Instruments and Acts...................................34
SECTION 3.17. Compliance with Laws...........................................34
SECTION 3.18. Amendments of Trust Agreement..................................34
ARTICLE IV SATISFACTION AND DISCHARGE........................................35
SECTION 4.01. Satisfaction and Discharge of Indenture........................35
SECTION 4.02. Application of Trust Money.....................................36
SECTION 4.03. Repayment of Monies Held by Paying Agent.......................36
ARTICLE V EVENTS OF DEFAULT; REMEDIES........................................36
SECTION 5.01. Events of Default..............................................36
SECTION 5.02. Rights Upon Event of Default...................................38
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee........................................38
SECTION 5.04. Remedies.......................................................40
SECTION 5.05. Optional Preservation of the Receivables.......................41
SECTION 5.06. Priorities.....................................................41
SECTION 5.07. Limitation of Suits............................................42
SECTION 5.08. Unconditional Rights of Noteholders to Receive
Principal and Interest...................................43
SECTION 5.09. Restoration of Rights and Remedies.............................43
SECTION 5.10. Rights and Remedies Cumulative.................................44
SECTION 5.11. Delay or Omission Not a Waiver.................................44
SECTION 5.12. Control by Noteholders.........................................44
SECTION 5.13. Waiver of Past Defaults........................................44
SECTION 5.14. Undertaking for Costs..........................................45
SECTION 5.15. Waiver of Stay or Extension Laws...............................45
SECTION 5.16. Action on Notes................................................45
SECTION 5.17. Performance and Enforcement of Certain Obligations.............46
ARTICLE VI THE INDENTURE TRUSTEE.............................................46
SECTION 6.01. Duties of Indenture Trustee....................................46
SECTION 6.02. Rights of Indenture Trustee....................................49
SECTION 6.03. Individual Rights of Indenture Trustee.........................50
SECTION 6.04. Indenture Trustee's Disclaimer.................................50
SECTION 6.05. Notice of Defaults.............................................50
SECTION 6.06. Reports by Indenture Trustee to Holders........................50
SECTION 6.07. Compensation and Indemnity.....................................50
SECTION 6.08. Replacement of Indenture Trustee...............................51
SECTION 6.09. Successor Indenture Trustee by Merger..........................52
SECTION 6.10. Appointment of Co-Indenture Trustee or Separate Indenture
Trustee........................................................53
SECTION 6.11. Eligibility....................................................54
SECTION 6.12. Preferential Collection of Claims Against Issuer...............54
SECTION 6.13. Representations and Warranties of Indenture Trustee............54
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS...................................55
SECTION 7.01. Issuer to Furnish Names and Addresses of Noteholders...........55
SECTION 7.02. Preservation of Information; Communications to Noteholders.....55
SECTION 7.03. Reports by Issuer..............................................56
SECTION 7.04. Reports by Indenture Trustee...................................56
ARTICLE VIII INTENTIONALLY BLANK.............................................57
ARTICLE IX DISTRIBUTIONS; STATEMENTS TO THE NOTEHOLDERS......................57
SECTION 9.01. Collection Account.............................................57
SECTION 9.02. Collections....................................................57
SECTION 9.03. Purchase Amounts..............................................58
SECTION 9.04. Distributions to Parties.......................................58
SECTION 9.05. Servicer Advances..............................................60
SECTION 9.06. Net Deposits...................................................60
SECTION 9.07. Intentionally Blank............................................60
SECTION 9.08. Intentionally Blank............................................61
SECTION 9.09. Payahead Account...............................................61
SECTION 9.10. Pre-Funding Account............................................61
SECTION 9.11. Release of Pledged Assets......................................62
SECTION 9.12. Opinion of Counsel.............................................62
ARTICLE X CREDIT ENHANCEMENT.................................................63
SECTION 10.01. Subordination................................................63
SECTION 10.02. Spread Account................................................63
SECTION 10.03. Policy........................................................64
ARTICLE XI SUPPLEMENTAL INDENTURES...........................................65
SECTION 11.01. Supplemental Indentures Without Consent of Noteholders........65
SECTION 11.02. Supplemental Indentures With Consent of Noteholders...........67
SECTION 11.03. Execution of Supplemental Indentures..........................68
SECTION 11.04. Effect of Supplemental Indenture..............................68
SECTION 11.05. Conformity With Trust Indenture Act...........................68
SECTION 11.06. Reference in Notes to Supplemental Indentures.................68
ARTICLE XII REDEMPTION OF NOTES..............................................69
SECTION 12.01. Redemption....................................................69
SECTION 12.02. Form of Redemption Notice.....................................69
SECTION 12.03. Notes Payable on Redemption Date..............................70
ARTICLE XIII MISCELLANEOUS...................................................70
SECTION 13.01. Compliance Certificates and Opinions, etc.....................70
SECTION 13.02. Form of Documents Delivered to Indenture Trustee..............71
SECTION 13.03. Acts of Noteholders...........................................73
SECTION 13.04. Notices, etc., to Indenture Trustee, Issuer,
Insurer and Rating Agencies............................73
SECTION 13.05. Notices to Noteholders; Waiver................................74
SECTION 13.06. Alternate Payment and Notice Provisions.......................75
SECTION 13.07. Conflict With Trust Indenture Act.............................75
SECTION 13.08. Effect of Headings and Table of Contents......................75
SECTION 13.09. Successors and Assigns........................................75
SECTION 13.10. Separability..................................................75
SECTION 13.11. Benefits of Indenture.........................................75
SECTION 13.12. Legal Holidays................................................76
SECTION 13.13. Governing Law.................................................76
SECTION 13.14. Counterparts..................................................76
SECTION 13.15. Recording of Indenture........................................76
SECTION 13.16. Trust Obligation..............................................76
SECTION 13.17. No Petition...................................................77
SECTION 13.18. Inspection....................................................77
SECTION 13.19. Limitation of Liability of Owner Trustee......................77
SECTION 13.20. Certain Matters Regarding the Insurer.........................77
SECTION 13.21. Acknolwegement of Parties Insurer Defense Costs................78
EXHIBITS
Schedule A Form of Depository Agreement
Exhibit A-1 Form of Class A-1 Note
Exhibit A-2 Form of Class A-2 Note
Exhibit A-3 Form of Class A-3 Note
Exhibit A-4 Form of Class A-4 Note
Exhibit B Form of Class B Note
TRUST INDENTURE ACT CROSS-REFERENCE TABLE
TIA SECTION OF
REQUIREMENT INDENTURE
----------- ----------
310(a).................................................................6.11
310(b).................................................................6.11
310(c)..................................................................N/A
311(a).................................................................6.12
311(b).................................................................6.12
311(c)..................................................................N/A
312(a)...........................................................7.01, 7.02
312(b).................................................................7.02
312(c).................................................................7.02
313(a).................................................................7.04
313(b).................................................................7.04
313(c).................................................................7.04
314(a).................................................................7.03
314(b).................................................................3.06
314(c)..........................................................4.01, 13.01
314(d)................................................................13.01
314(e)................................................................13.01
314(f)..................................................................N/A
315(a).................................................................6.01
315(b).................................................................6.05
315(c).................................................................6.01
315(d).................................................................6.01
315(e).................................................................5.14
316(a).................................................................5.04
316(b)................................................................11.02
316(c)................................................................13.03
317(a).................................................................5.03
317(b).................................................................3.03
318(a).................................................................1.02
This INDENTURE, dated as of September 25, 2001, is entered into between
UACSC 2001-C OWNER TRUST, a Delaware business trust, as issuer (the "Issuer"),
and BNY MIDWEST TRUST COMPANY, an Illinois banking corporation, as indenture
trustee (the "Indenture Trustee").
Each party agrees as follows for the benefit of the other parties and for
the benefit of the Noteholders and the Insurer:
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee on the Closing Date, on
behalf of and for the benefit of the Noteholders and the Insurer, without
recourse, all of the Issuer's right, title and interest in, to and under, (i)
the Receivables listed on Schedule A to the Trust Agreement, (ii) the security
interests in the Financed Vehicles or in any other property granted by Obligors
pursuant to the Receivables, (iii) any Liquidation Proceeds and any proceeds
from claims or refunds of premiums on any physical damage, lender's single
interest, credit life, disability and hospitalization insurance policies
covering Financed Vehicles or Obligors relating to the Receivables, (iv) funds
deposited in the Spread Account and the Pre-Funding Account (and any Eligible
Investments purchased with funds in any such account), and funds deposited in
the Collection Account and the Payahead Account with respect to the Receivables,
(v) the interest of the Issuer in any proceeds from recourse to Dealers relating
to the Receivables, (vi) all documents contained in the Receivable Files
relating to the Receivables, (vii) all monies paid and all monies due, including
Accrued Interest, as of and after the Cutoff Date (but excluding Accrued
Interest paid prior to the Closing Date), (viii) the rights of the Seller
pursuant to the Purchase Agreements and the rights of the Issuer pursuant to the
Trust Agreement to require UAC to repurchase any such Receivables as to which
there has been a breach of the representations and warranties contained therein,
(ix) the benefits of the Policy with respect to the Receivables and (x) all
proceeds (including, without limitation, "proceeds" as defined in the UCC of the
jurisdiction the law of which governs the perfection of the interest in such
Receivables so transferred) of any of the foregoing. Such property described in
the preceding sentence, together with (a) any and all other right, title and
interest, including any beneficial interest the Issuer may have in the
Collection Account and the Spread Account, and (b) the funds deposited in and
from time to time on deposit in such accounts, and all Eligible Investments and
other securities, instruments and other investments purchased from such funds,
shall hereinafter be referred to as the "Pledged Assets." The Issuer does not
convey to the Indenture Trustee, and the Pledged Assets do not include, any
interest in any contracts with Dealers related to any "dealer reserve" or any
rights to the recapture of any dealer reserve with respect to such Receivables.
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 (except as provided
herein with respect to the subordination of the Class B Notes), 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, on behalf of the Noteholders 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 Noteholders may be adequately and effectively protected.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
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 Trust 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 13.03(a).
"Administration Agreement" means the Administration Agreement, dated as of
September 25, 2001 among the Trust, the Administrator and the Indenture Trustee.
"Administrator" means the Administrator under the Administration Agreement,
which is initially UAC, and its successors and assigns thereunder.
"Affiliate" means, as to any specified Person, any other Person controlling
or controlled by or under common control with such specified Person. For the
purposes of this definition, "control" when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" or "controlled" have the
meanings correlative to the foregoing.
"Authorized Officer" means, with respect to the Issuer, any 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 or to the Indenture Trustee 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 vice president or more senior
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 on
the Closing Date (as such list may be modified or supplemented from time to time
thereafter).
"Available Funds" has the meaning provided in the Trust Agreement.
"Avoided Payment" has the meaning provided in the definition of Preference
Amounts.
"Basic Documents" means the Certificate of Trust, the Trust Agreement, the
Administration Agreement, the Depository Agreement, the Insurance Agreement, the
Policy and this Indenture.
"Book-Entry Notes" means a beneficial interest in the Notes, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 2.09.
"Certificateholders" means the owners or holders of the Certificates
pursuant to the Trust Agreement.
"Class" means all Notes whose form is identical except for variation in
denomination, principal amount or owner.
"Class A Monthly Interest" means the sum of Class A-1 Monthly Interest,
Class A-2 Monthly Interest, Class A-3 Monthly Interest and Class A-4 Monthly
Interest.
"Class A Monthly Principal" means the sum of Class A-1 Monthly Principal,
Class A-2 Monthly Principal, Class A-3 Monthly Principal and Class A-4 Monthly
Principal.
"Class A Note" means a Class A-1 Note, a Class A-2 Note, a Class A-3 Note
or a Class A-4 Note.
"Class A Noteholder" means a Class A-1 Noteholder, a Class A-2 Noteholder,
a Class A-3 Noteholder or a Class A-4 Noteholder.
"Class A-1 Interest Rate" means 2.585% per annum.
"Class A-1 Monthly Interest" means, (i) for the first Payment Date, the
product of one-three hundred sixtieth (1/360th) of the Class A-1 Interest Rate,
the actual number of days from the Closing Date through the day before the first
Payment Date and the Initial Class A-1 Note Balance and (ii) for any subsequent
Payment Date, the product of one-three hundred sixtieth (1/360th) of the Class
A-1 Interest Rate, the actual number of days from the previous Payment Date
through the day before the related Payment Date and the Class A-1 Note Balance
as of the immediately preceding Payment Date (after giving effect to any
distribution of Monthly Principal made on such immediately preceding Payment
Date).
"Class A-1 Monthly Principal" means that portion of Monthly Principal to be
paid to Class A-1 Noteholders on each Payment Date in accordance with Sections
9.04 and 9.10(c).
"Class A-1 Note" means a promissory note executed on behalf of the Trust
and authenticated by the Indenture Trustee substantially in the form attached
hereto as Exhibit A-1.
"Class A-1 Note Balance" means, at any time, the Initial Class A-1 Note
Balance minus all payments of Monthly Principal to Class A-1 Noteholders made up
to such time.
"Class A-1 Noteholder" means the Person in whose name the respective Class
A-1 Note shall be registered in the Note Register, except that, solely for the
purposes of giving any consent, waiver, request, or demand pursuant to this
Indenture, the interest evidenced by any Class A-1 Note registered in the name
of the Issuer, the Seller, the Servicer or UAC, or any Person controlling,
controlled by, or under common control with the Issuer, the Seller or the
Servicer, shall not be taken into account in determining whether the requisite
percentage necessary to effect any such consent, waiver, request, or demand
shall have been obtained.
"Class A-2 Interest Rate" means 3.03% per annum.
"Class A-2 Monthly Interest" means, (i) for the first Payment Date, the
product of one-twelfth of the Class A-2 Interest Rate, the number of days from
the Closing Date (assuming each month has 30 days) through the day before the
first Payment Date divided by 30 and the Initial Class A-2 Note Balance and (ii)
for any subsequent Payment Date, the product of one-twelfth of the Class A-2
Interest Rate and the Class A-2 Note Balance as of the immediately preceding
Payment Date (after giving effect to any distribution of Monthly Principal made
on such immediately preceding Payment Date).
"Class A-2 Monthly Principal" means that portion of Monthly Principal to be
paid to Class A-2 Noteholders on each Payment Date in accordance with Sections
9.04 and 9.10(c).
"Class A-2 Note" means a promissory note executed on behalf of the Trust
and authenticated by the Indenture Trustee substantially in the form attached
hereto as Exhibit A-2.
"Class A-2 Note Balance" means, at any time, the Initial Class A-2 Note
Balance minus all payments of Monthly Principal to Class A-2 Noteholders made up
to such time.
"Class A-2 Noteholder" means the Person in whose name the respective Class
A-2 Note shall be registered in the Note Register, except that, solely for the
purposes of giving any consent, waiver, request, or demand pursuant to this
Indenture, the interest evidenced by any Class A-2 Note registered in the name
of the Issuer, the Seller, the Servicer or UAC, or any Person controlling,
controlled by, or under common control with the Issuer, the Seller or the
Servicer, shall not be taken into account in determining whether the requisite
percentage necessary to effect any such consent, waiver, request, or demand
shall have been obtained.
"Class A-3 Interest Rate" means 3.81% per annum.
"Class A-3 Monthly Interest" means, (i) for the first Payment Date, the
product of one-twelfth of the Class A-3 Interest Rate, the number of days from
the Closing Date (assuming each month has 30 days) through the day before the
first Payment Date divided by 30 and the Initial Class A-3 Note Balance and (ii)
for any subsequent Payment Date, the product of one-twelfth of the Class A-3
Interest Rate and the Class A-3 Note Balance as of the immediately preceding
Payment Date (after giving effect to any distribution of Monthly Principal made
on such immediately preceding Payment Date).
"Class A-3 Monthly Principal" means that portion of Monthly Principal to be
paid to Class A-3 Noteholders on each Payment Date in accordance with Sections
9.04 and 9.10(c).
"Class A-3 Note" means a promissory note executed on behalf of the Trust
and authenticated by the Indenture Trustee substantially in the form attached
hereto as Exhibit A-3.
"Class A-3 Note Balance" means, at any time, the Initial Class A-3 Note
Balance minus all payments of Monthly Principal to Class A-3 Noteholders made up
to such time.
"Class A-3 Noteholder" means the Person in whose name the respective Class
A-3 Note shall be registered in the Note Register, except that, solely for the
purposes of giving any consent, waiver, request, or demand pursuant to this
Indenture, the interest evidenced by any Class A-3 Note registered in the name
of the Issuer, the Seller, the Servicer or UAC, or any Person controlling,
controlled by, or under common control with the Issuer, the Seller or the
Servicer, shall not be taken into account in determining whether the requisite
percentage necessary to effect any such consent, waiver, request, or demand
shall have been obtained.
"Class A-4 Interest Rate" means 4.39% per annum; provided, however, the per
annum rate shall be increased by 0.50% beginning on the first Payment Date on
which the Note Balances (after giving effect to all payments of principal on
such Payment Date) will be less than 10% of the Initial Note Balances if the
Class A-4 Notes will not be redeemed on such Payment Date.
"Class A-4 Monthly Interest" means, (i) for the first Payment Date, the
product of one-twelfth of the Class A-4 Interest Rate, the number of days from
the Closing Date (assuming each month has 30 days) through the day before the
first Payment Date divided by 30 and the Initial Class A-4 Note Balance and (ii)
for any subsequent Payment Date, the product of one-twelfth of the Class A-4
Interest Rate and the Class A-4 Note Balance as of the immediately preceding
Payment Date (after giving effect to any distribution of Monthly Principal made
on such immediately preceding Payment Date).
"Class A-4 Monthly Principal" means that portion of Monthly Principal to be
paid to Class A-4 Noteholders on each Payment Date in accordance with Sections
9.04 and 9.10(c).
"Class A-4 Note" means a promissory note executed on behalf of the Trust
and authenticated by the Indenture Trustee substantially in the form attached
hereto as Exhibit A-4.
"Class A-4 Note Balance" means, at any time, the Initial Class A-4 Note
Balance minus all payments of Monthly Principal to Class A-4 Noteholders made up
to such time.
"Class A-4 Noteholder" means the Person in whose name the respective Class
A-4 Note shall be registered in the Note Register, except that, solely for the
purposes of giving any consent, waiver, request, or demand pursuant to this
Indenture, the interest evidenced by any Class A-4 Note registered in the name
of the Issuer, the Seller, the Servicer or UAC, or any Person controlling,
controlled by, or under common control with the Issuer, the Seller or the
Servicer, shall not be taken into account in determining whether the requisite
percentage necessary to effect any such consent, waiver, request, or demand
shall have been obtained.
"Class B Interest Rate" means 4.73% per annum; provided, however, the per
annum rate shall be increased by 0.50% beginning on the first Payment Date on
which the Note Balances (after giving effect to all payments of principal on
such Payment Date) will be less than 10% of the Initial Note Balances if the
Class B Notes will not be redeemed on such Payment Date.
"Class B Monthly Interest" means, (i) for the first Payment Date, the
product of one-twelfth of the Class B Interest Rate, the number of days from the
Closing Date (assuming each month has 30 days) through the day before the first
Payment Date divided by 30 and the Initial Class B Note Balance and (ii) for any
subsequent Payment Date, the product of one-twelfth of the Class B Interest Rate
and the Class B Note Balance as of the immediately preceding Payment Date (after
giving effect to any distribution of Monthly Principal made on such immediately
preceding Payment Date).
"Class B Monthly Principal" means that portion of Monthly Principal to be
paid to Class B Noteholders on each Payment Date in accordance with Sections
9.04 and 9.10(c).
"Class B Note" means a promissory note executed on behalf of the Trust and
authenticated by the Indenture Trustee substantially in the form attached hereto
as Exhibit B.
"Class B Note Balance" means, at any time, the Initial Class B Note Balance
minus all payments of Monthly Principal to Class B Noteholders made up to such
time.
"Class B Noteholder" means the Person in whose name the respective Class B
Note shall be registered in the Note Register, except that, solely for the
purposes of giving any consent, waiver, request, or demand pursuant to this
Indenture, the interest evidenced by any Class B Note registered in the name of
the Issuer, the Seller, the Servicer or UAC, or any Person controlling,
controlled by, or under common control with the Issuer, the Seller or the
Servicer, shall not be taken into account in determining whether the requisite
percentage necessary to effect any such consent, waiver, request, or demand
shall have been obtained.
"Clearing Agency" means an organization registered as a "Clearing Agency"
pursuant to Section 17A of the Exchange Act.
"Clearing Agency Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
"Closing Date" has the meaning provided in the Trust Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Controlling Party" means the Insurer, so long as no Insurer Default shall
have occurred and be continuing and the Policy shall remain in effect, and the
Indenture Trustee, for so long as an Insurer Default shall have occurred and be
continuing and the Policy shall not have terminated in accordance with its
terms.
"Corporate Trust Office" means the office of the Indenture Trustee located
at ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (facsimile no. 312-827-8562),
Attention: Corporate Trust Administration.
"Default" means any occurrence that is, or with notice or the lapse of time
or both would become, an Event of Default.
"Defaulted Receivable" has the meaning specified in the Trust and Servicing
Agreement.
"Definitive Notes" shall have the meaning specified in Section 2.09.
"Depository Agreement" means the agreement dated the Closing Date, among
the Issuer, the Indenture Trustee and DTC, as the initial Clearing Agency,
relating to the Notes, substantially in the form of Schedule A hereto.
"DTC" means The Depository Trust Company, a New York corporation.
"Eligible Investment" has the meaning specified in the Trust and Servicing
Agreement.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Event of Default" shall have the meaning specified in Section 5.01(a).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Executive Officer" means, with respect to any corporation or bank, the
Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, Executive Vice President, any Vice President, the Secretary or the
Treasurer of such corporation or bank; and with respect to any partnership, any
general partner thereof.
"Final Maturity Date" means October 8, 2002, with respect to the Class A-1
Notes, January 10, 2005, with respect to the Class A-2 Notes, April 10, 2006,
with respect to the Class A-3 Notes, February 8, 2008, with respect to the Class
A-4 Notes, and November 9, 2009, with respect to the Class B Notes.
"Final Order" has the meaning specified in Section 10.03(b).
"First Loss Protection Amount" means, for each Payment Date, an amount (not
less than zero) equal to the lesser of (a) 5.00% multiplied by the outstanding
Note Balances (such amount to be determined as of the prior Payment Date (after
giving effect to all distributions on such prior Payment Date), or in the case
of the first Payment Date, as of the Closing Date) less the amount on deposit in
the Spread Account (other than the Pre-Funding Reserve Balance) (such amount to
be determined as of the prior Payment Date (after giving effect to all
distributions on such prior Payment Date) or, in the case of the first Payment
Date, as of the Closing Date); (b) an amount equal to 3.00% multiplied by the
Initial Note Balances; and (c) the First Loss Protection Amount for the prior
Payment Date.
"Fiscal Agent" shall have the meaning specified in the Insurance Agreement.
"Grant" means mortgage, pledge, bargain, sell, warrant, 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 Pledged Assets 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 Pledged Assets and all other monies
payable thereunder, to give and receive notices and other communications, to
make waivers or other agreements, to exercise all rights and options, to bring
Proceedings in the name of the granting party or otherwise and generally to do
and receive anything that the granting party is or may be entitled to do or
receive thereunder or with respect thereto.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Note Register.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Indenture Trustee" means BNY Midwest Trust Company, an Illinois banking
corporation, as the Indenture Trustee under this Indenture, and its permitted
successors and assigns.
"Independent" when used with respect to any specified Person, means that
such a Person (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.
"Independent Certificate" means a certificate or opinion to be delivered to
the Indenture Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 13.01, made by an
Independent appraiser or other expert appointed by an Issuer Order and approved
by the Indenture Trustee in the exercise of reasonable care, and such opinion or
certificate shall state that the signer has read the definition of "Independent"
in this Indenture and that the signer is Independent within the meaning thereof.
"Initial Class A-1 Note Balance" means $62,105,000.
"Initial Class A-2 Note Balance" means $89,627,000.
"Initial Class A-3 Note Balance" means $67,659,000.
"Initial Class A-4 Note Balance" means $90,809,000.
"Initial Class B Note Balance" means $19,800,000.
"Initial Note Balances" means $330,000,000.
"Initial Spread Account Amount" means $0.00.
"Insolvency Proceeding" means the commencement, after the date hereof, of
any bankruptcy, insolvency, readjustment of debt, reorganization, marshaling of
assets and liabilities or similar proceedings by or against UAC, any of the
Warehouse Subsidiaries or the Seller, the commencement, after the date hereof,
of any proceedings by or against UAC, any of the Warehouse Subsidiaries or the
Seller for the winding up or liquidation of its affairs or the consent, after
the date hereof, to the appointment of a trustee, conservator, receiver, or
liquidator in any bankruptcy, insolvency, readjustment of debt, reorganization,
marshaling of assets and liabilities or similar proceedings of or relating to
UAC, any of the Warehouse Subsidiaries or the Seller.
"Insurance Agreement" means the Insurance and Reimbursement Agreement,
dated as of the Closing Date, among the Seller, UAC individually and as
Servicer, the Warehouse Subsidiaries and the Insurer pursuant to which the
Insurer issued the Policy.
"Insurance Premium" means Premium as defined in the Premium Side Letter
Agreement.
"Insurer Default" means the Insurer is in default under the Policy after
the expiration of any applicable cure period.
"Insurer Defense Costs" means all costs and expenses of the Insurer
(including costs and expenses of the Owner Trustee paid by the Insurer)
reasonably incurred in connection with any action, proceeding or governmental
investigation to which the Trust is a party or subject that could materially
adversely affect the Trust or the Trust estate or the rights or obligations of
the Insurer under any of the Basic Documents, including (without limitation) any
judgment or settlement entered into in connection with any such action,
proceeding or governmental investigation, together with interest thereon at a
rate equal to the Base Rate (as defined in the Insurance Agreement) from time to
time in effect plus 1%.
"Issuer" means the UACSC 2001-C Owner Trust as the issuer of the Notes
under this Indenture and its permitted successors and assigns.
"Issuer Order" and "Issuer Request" each means a written order or request
signed in the name of the Issuer by an Authorized Officer and delivered to the
Indenture Trustee.
"Monthly Interest" means the sum of Class A Monthly Interest and Class B
Monthly Interest.
"Monthly Principal" for any Payment Date will equal the sum of the
following:
(i) the amount by which the Pool Balance declined during the related
Collection Period;
(ii) the additional amount, if any, which is necessary to reduce the Note
Balance of a class of Notes to zero on its Final Maturity Date; and
(iii) any amounts distributed pursuant to Section 9.10(c).
For the purpose of determining Monthly Principal, the unpaid principal
balance of a Defaulted Receivable or a Purchased Receivable is deemed to be
zero on and after the last day of the Collection Period in which such
Receivable became a Defaulted Receivable or a Purchased Receivable. In no
event will Monthly Principal exceed the Outstanding Note Balances.
"Net Cumulative Loss Event" has the meaning specified in the Insurance
Agreement.
"Net Cumulative Loss Percentage" means, for any Payment Date, the fraction
(expressed as a percentage) of which the numerator is the aggregate Principal
Balance of all Defaulted Receivables as of such Payment Date less the aggregate
amount of Liquidation Proceeds received after the Cutoff Date as of such Payment
Date and (ii) the denominator is the Original Pool Balance.
"Net Principal Policy Amount" means the Initial Note Balances minus all
amounts previously drawn on the Policy or from the Spread Account with respect
to Monthly Principal.
"Note" means a Class A-1 Note, a Class A-2 Note, a Class A-3 Note, a Class
A-4 Note or a Class B Note.
"Note Balances" means, at any time, the Initial Note Balances minus all
payments of principal made to the Noteholders up to such time. The term "Note
Balance" means the Outstanding principal balance of a particular Class of Notes,
depending upon the context. When the term "Note Balances" is used herein with
respect to an issue relating to the consent of or voting of Noteholders, such
term shall refer only to the Classes of Notes then Outstanding such that the
Noteholders will vote as a single class.
"Noteholder" has the meaning provided in the definition of Holder.
"Note Owner" means, with respect to a Book-Entry Note, the Person who is
the owner of such Book-Entry Note, as reflected on the books of the Clearing
Agency, or on the books of a Person maintaining an account with such Clearing
Agency (directly as a Clearing Agency participant or as an indirect participant,
in each case in accordance with the rules of such Clearing Agency).
"Note Register" and "Note Registrar" have the respective meanings specified
in Section 2.04.
"Officer's Certificate" means a certificate signed by an Authorized Officer
of the Issuer, under the circumstances described in, and otherwise complying
with, the applicable requirements of Section 13.01, and delivered to the
Indenture Trustee.
"Opinion of Counsel" means one or more written opinions of counsel who may,
except as otherwise expressly provided in this Indenture, be employees of or
counsel to the Seller or the Issuer and who shall be satisfactory to the
Indenture Trustee and, if addressed to the Insurer, satisfactory to the Insurer,
and which shall comply with any applicable requirements of Section 13.01, and
shall be in form and substance satisfactory to the Indenture Trustee, and if
addressed to the Insurer, satisfactory to the Insurer.
"Original Pool Balance" has the meaning specified in the Trust Agreement.
"Outstanding" or "Outstanding Notes" means, as of the date of
determination, all Notes theretofore authenticated and delivered under this
Indenture except:
(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 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 in determining
whether the Holders of the requisite Outstanding Note Balances 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 the Indenture Trustee knows to be so owned shall be so disregarded.
Notes so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Indenture
Trustee the pledgee's right so to act with respect to such Notes and that
the pledgee is not the Issuer, the Seller or any of their respective
Affiliates.
"Owner Trustee" means First Union Trust Company, National Association,
acting not in its individual capacity but solely as trustee under the Trust
Agreement on behalf of the Trust.
"Paying Agent" means the Indenture Trustee or any other Person that meets
the eligibility standards for the Indenture Trustee specified in Section 6.11
and is authorized by the Issuer to make the distributions from the Collection
Account, including payment of principal of or interest on the Notes on behalf of
the Issuer.
"Payment Date" has the meaning provided in the Trust Agreement.
"Pledged Assets" has the meaning provided in the Granting Clause of this
Indenture.
"Policy" means the irrevocable financial guaranty insurance policy dated as
of the Closing Date, issued by the Insurer to the Indenture Trustee for the
benefit of the Noteholders and having a maximum amount available to be drawn in
respect of the Monthly Servicing Fee, Monthly Interest and Monthly Principal
equal to the Policy Amount.
"Policy Amount" on any Payment Date means:
(A) the sum of:
(x) the Monthly Servicing Fee;
(y) Monthly Interest; and
(z) the lesser of (i) the Outstanding Note Balances on such
Payment Date (after giving effect to any distributions of Available
Funds and any funds withdrawn from the Spread Account to pay Monthly
Principal on such Payment Date) and (ii) the Net Principal Policy
Amount (after giving effect to any distributions of Available Funds
and any funds withdrawn from the Spread Account to pay Monthly
Principal).
less:
(B) all amounts on deposit in the Spread Account on such Payment Date
(after giving effect to any amounts withdrawn from the Spread
Account on such Payment Date).
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.05 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.
"Preference Amounts" means any amount guaranteed pursuant to the Policy
which is voided (a "Preference Event") under any applicable bankruptcy,
insolvency, receivership or similar law in an Insolvency Proceeding, and, as a
result of such a Preference Event, the Indenture Trustee or any Noteholder is
required to return such voided payment, or any portion of such voided payment
made or to be made in respect of the Notes (an "Avoided Payment").
"Premium Side Letter Agreement" means the letter dated the Closing Date as
defined in the Insurance Agreement.
"Principal Payment Sequence" means the order in which Monthly Principal
shall be distributed among the Noteholders. The order of distribution of Monthly
Principal is:
(1) to the Class A-1 Noteholders until the Class A-1 Note Balance has been
reduced to zero;
(2) to the Class A-2 Noteholders until the Class A-2 Note Balance has been
reduced to zero;
(3) to the Class A-3 Noteholders until the Class A-3 Note Balance has been
reduced to zero;
(4) to the Class A-4 Noteholders until the Class A-4 Note Balance has been
reduced to zero; and
(5) to the Class B Noteholders until the Class B Note Balance has been
reduced to zero.
However, if the amount of Available Funds (together with amounts withdrawn from
the Spread Account and/or the Policy) are not sufficient on any Payment Date to
pay the required payment of Class A Monthly Principal to Class A Noteholders in
full, the amount of such funds available to pay Class A Monthly Principal to
Class A Noteholders will be distributed pro rata to the Class A Noteholders
based upon the relative Note Balance of each class of Class A Notes.
"Proceeding" means any suit in equity, action at law or other judicial or
administrative proceeding.
"Rating Agency Condition" means, with respect to any action, that (i)
Standard & Poor's shall have been given ten Business Days (or such shorter
period as is acceptable to Standard & Poor's) prior notice thereof and that
Standard & Poor's 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, (ii)
Moody's shall have been given ten Business Days (or such shorter period as is
acceptable to Moody's) prior notice thereof and copies of all documentation
relating to the event requiring such Rating Agency Condition and (iii) each
Rating Agency shall have confirmed to the Insurer that the shadow risk of the
Insurer with respect to the Notes is investment grade.
"Record Date" means, with respect to a Payment Date or Redemption Date, the
close of business on the Business Day immediately preceding such Payment Date or
Redemption Date, or, in the event that Definitive Notes are issued, the close of
business on the last day of the related Collection Period.
"Recoveries of Advances" means, for any Collection Period, all payments
received by the Servicer by or on behalf of Obligors (other than Obligors with
respect to Defaulted Receivables and excluding reimbursements of Outstanding
Advances on Defaulted Receivables pursuant to Section 9.05 hereof and Section
9.04(a)(i) of the Indenture) during such Collection Period representing
recoveries of Interest Shortfalls for which Advances were made for prior
Collection Periods.
"Redemption Date" means the Payment Date specified by the Servicer or the
Issuer pursuant to Section 12.01.
"Redemption Price" means an amount equal to the unpaid principal amount of
the Notes redeemed plus accrued and unpaid interest thereon at the respective
interest rates of each Class of Notes being so redeemed to but excluding the
Redemption Date.
"Required Cash Floor" means, on each Payment Date, 2.00% of the Initial
Note Balances; provided, that on any Payment Date on which a Net Cumulative Loss
Event has occurred and has not been cured, the Required Cash Floor shall equal
3.00% of the Initial Note Balances; provided further, that in the event that a
Net Cumulative Loss Event, an Event of Default, or a Trigger Event shall have
occurred and then been cured and the First Loss Protection Amount shall be
greater than zero, the Required Cash Floor shall equal the greater of (a) 2.00%
of the Initial Note Balances, and (b) the product of (x) a fraction, the
numerator of which is the amount on deposit in the Spread Account at the
beginning of the first Collection Period commencing after any such event is
cured, and the denominator of which is the Note Balances as of the beginning of
such Collection Period, and (y) the Note Balances as of the end of the
Collection Period related to the current Payment Date.
"Required Spread Amount" means, on each Payment Date, the Required Cash
Floor; provided, that on or after the first Payment Date on which the Excess
Yield Requirement (as defined in the Insurance Agreement) has not been met, the
Required Spread Amount shall be the greater of (a) the Required Cash Floor then
in effect and (b) 5.00% of the Note Balances as of the end of the Collection
Period related to the current Payment Date. Notwithstanding the foregoing, upon
and during the continuance of an Event of Default or a Trigger Event, the
Required Spread Amount shall be equal to the Policy Amount as of such Payment
Date, without giving effect to amounts on deposit in the Spread Account, after
giving effect to any draws on the Policy, draws on the Spread Account and other
distributions pursuant to Section 9.04 on such Payment Date. Once such Event of
Default or Trigger Event has been cured or discontinued, the Required Spread
Amount shall be determined as otherwise set forth above.
"Responsible Officer" means, when used with respect to the Indenture
Trustee, any officer within the corporate trust department of the Indenture
Trustee including any vice president, assistant vice president, assistant
treasurer, assistant secretary or any other officer of the Indenture Trustee
customarily performing functions similar to those performed by the persons who
at the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of his knowledge of and familiarity with the
particular subject.
"Securities Act" means the Securities Act of 1933, as amended.
"Servicer Default" means an Event of Servicer Default under the Trust
Agreement.
"Spread Account" shall have the meaning specified in Section 10.02(a).
"State" means any one of the ▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ or the District
of Columbia.
"Termination Date" means the latest of (i) the expiration of the Policy and
the return of the Policy to the Insurer for cancellation, (ii) the date on which
the Insurer shall have received payment and performance of all amounts and
obligations which the Issuer may owe to or on behalf of the Insurer under this
Indenture and (iii) the date on which the Indenture Trustee shall have received
payment and performance of all amounts and obligations which the Issuer may owe
to or on behalf of the Indenture Trustee for the benefit of the Noteholders
under this Indenture or the Notes.
"Trigger Event" has the meaning provided in the Insurance Agreement.
"Trust Agreement" means the Trust and Servicing Agreement, dated as of the
date hereof, among the Seller, the Servicer and the Owner Trustee.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939, as
amended, as in force on the date hereof, unless otherwise specifically provided.
"UAC" means Union Acceptance Corporation, an Indiana corporation, and its
successors.
"Underwriter" means each of Banc of America Securities LLC and First Union
Securities, Inc.
"Underwriter Exemption" means the exemption granted to each Underwriter by
the U.S. Department of Labor, as amended by Prohibited Transaction Exemption
("PTE") 97-34 and PTE 2000-58.
"United States" means the United States of America.
SECTION 1.02. Incorporation by Reference of Trust Indenture Act. Whenever
this Indenture refers to a provision of the TIA, the provision is incorporated
by reference in and made a part of this Indenture. The following TIA terms used
in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"Indenture Securities" means the Notes.
"Indenture Security Holder" means a Noteholder.
"Indenture to be Qualified" means this Indenture.
"Indenture Trustee" or "Institutional Trustee" means the Indenture Trustee.
"Obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule have
the meaning assigned to them by such definitions.
SECTION 1.03. Rules of Construction. Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning assigned
to it in accordance with generally accepted accounting principles as in
effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
(v) words in the singular include the plural and words in the plural
include the singular;
(vi) any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein; references to a Person are also to its permitted
successors and assigns; and
(vii) 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 Schedule references contained in this Indenture are
references to Sections, subsections and Schedules in or to this Indenture
unless otherwise specified.
ARTICLE II
THE NOTES
SECTION 2.01. Form.
(a) The Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes
and Class B Notes, in each case together with the Indenture Trustee's
certificate of authentication, shall be in substantially the forms set forth as
Exhibits ▇-▇, ▇-▇, ▇-▇, ▇-▇ and B 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.
(b) Each Note shall be dated the date of its authentication. The terms of
the Notes set forth in the exhibits hereto are part of the terms of this
Indenture.
SECTION 2.02. Execution, Authentication and Delivery.
(a) The Notes shall be executed on behalf of the Issuer by the Owner
Trustee, as provided herein. The signature of any Authorized Officer on the
Notes may be manual or facsimile. Notes bearing the manual or facsimile
signature of individuals who were at any time Authorized Officers of the Issuer
shall bind the Issuer, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of such
Notes or did not hold such offices at the date of such Notes.
(b) The Indenture Trustee shall, upon receipt of an Issuer Order,
authenticate and deliver for original issue Notes in the amount of the Initial
Class A-1 Note Balance, the Initial Class A-2 Note Balance, the Initial Class
A-3 Note Balance, the Initial Class A-4 Note Balance and the Initial Class B
Note Balance. The aggregate principal amount of the 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.
(c) 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 evidence, and the only evidence,
that such Note has been duly authenticated and delivered hereunder.
SECTION 2.03. Temporary Notes.
(a) Pending the preparation of Definitive Notes, the Issuer may execute,
and upon receipt of an Issuer Order the Indenture Trustee shall authenticate and
deliver, temporary Notes that are printed, lithographed, typewritten,
mimeographed or otherwise produced, of the tenor of the Definitive Notes in lieu
of which they are issued and with such variations not inconsistent with the
terms of this Indenture as the officers executing such Notes may determine, as
evidenced by their execution of such Notes.
(b) If temporary Notes are issued, 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.
(a) The Issuer shall cause to be kept a register (the "Note Register") in
which, subject to such reasonable regulations as it may prescribe, the Issuer
shall provide for the registration of Notes and the registration of transfers of
Notes. The Indenture Trustee shall be the initial "Note Registrar" for the
purpose of registering Notes and transfers of Notes as herein provided. Upon any
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note
Registrar.
(b) If a Person other than the Indenture Trustee is appointed by the Issuer
as Note Registrar, the Issuer will give the Indenture Trustee prompt written
notice of the appointment of such Note Registrar and of the location, and any
change in the location, of the Note Register, and the Indenture Trustee shall
have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee 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 Noteholders and the
principal amounts and number of such Notes.
(c) Upon surrender for registration of transfer of any Note at the office
or agency of the Issuer to be maintained as provided in Section 3.02, 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.
(d) 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.
(e) All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Issuer, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
(f) 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.
(g) No service charge shall be made to a Holder for any registration of
transfer or exchange of Notes, but the Issuer or the Indenture Trustee may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges pursuant to Section 2.03 or 11.06 not
involving any transfer.
(h) The preceding provisions of this Section notwithstanding, the Issuer
shall not be required to make and the Note Registrar need not register transfers
or exchanges of Notes selected for redemption or of any Note for a period of 15
days preceding the due date for any payment with respect to the Note.
SECTION 2.05. Mutilated, Destroyed, Lost or Stolen Notes.
(a) If (i) any mutilated Note is surrendered to the Indenture Trustee, or
the Indenture Trustee receives evidence to its satisfaction of the destruction,
loss or theft of any Note, and (ii) there is delivered to the Indenture Trustee
and the Insurer (unless an Insurer Default shall have occurred and be
continuing) 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 the Indenture Trustee that such Note
has been acquired by a bona fide purchaser, the Issuer shall execute and upon
its request the Indenture Trustee shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Note, a
replacement Note of the same Class; provided, however, that if any such
destroyed, lost or stolen Note, but not a mutilated Note, shall have become or
within seven days 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.
(b) Upon the issuance of any replacement Note under this Section, the
Issuer or the Indenture Trustee may require the payment by the Holder of such
Note of a sum sufficient to cover any tax or other governmental charge that may
be imposed in relation thereto and any other reasonable expenses (including the
fees and expenses of the Indenture Trustee or the Note Registrar) connected
therewith.
(c) Every replacement Note issued pursuant to this Section in replacement
of any mutilated, destroyed, lost or stolen Note shall constitute an original
contractual obligation of the Issuer, whether or not the mutilated, destroyed,
lost or stolen Note shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Notes duly issued hereunder.
(d) The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Notes. In the case of the
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 be
overdue, and none of the Issuer, the Insurer, the Indenture Trustee nor any of
their respective agents shall be affected by notice to the contrary.
SECTION 2.06. Intentionally Blank.
SECTION 2.07. Payment of Principal and Interest; Defaulted Interest.
(a) Each Class of Notes shall accrue interest as provided in this Indenture
at the related interest rate for such Class, and such interest shall be payable
on each Payment Date as specified herein, subject to Section 3.01. Interest
accrued on any Note but not paid on any Payment Date will be due on the
immediately succeeding Payment Date, together with, to the extent permitted by
applicable law, interest on such shortfall at the related interest rate. 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 Payment
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 and except for the
final installment of principal payable with respect to such Note on a Payment
Date, a Redemption Date or on the related Final Maturity Date, as the case may
be (and except for the Redemption Price for any Note called for redemption
pursuant to Section 12.01), which shall be payable as provided below. The funds
represented by any such checks returned undelivered shall be held in accordance
with Section 3.03.
(b) The principal of each Note shall be payable on each Payment Date to the
extent provided in this Indenture and 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 Maturity Date of such Class;
(ii) the Redemption Date;
(iii) if (A) an Event of Default shall have occurred and be continuing
and (B) an Insurer Default shall not have occurred and be continuing and
the Policy shall be in effect, 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 (A) an Event of Default shall have occurred and be continuing
and (B) an Insurer Default shall have occurred and be continuing or the
Policy shall have terminated in accordance with its terms, the date on
which the Noteholders representing not less than 66 2/3% of the Note
Balances shall 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 Payment 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 of such Payment 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 Payment Date) or
receipt of notice of termination of the Trust pursuant to Section 16.01 of the
Trust Agreement and shall specify that such final installment will be payable
only upon presentation and surrender of such Note and shall specify the place
where such Note may be presented and surrendered for payment of such
installment. Notices in connection with redemptions of Notes shall be mailed to
Noteholders as provided in Section 12.02. In addition, the Administrator shall
notify the Insurer and the Rating Agencies upon the final payment of interest on
and principal of each Class of Notes, and upon the termination of the Trust, in
each case pursuant to the Administration Agreement.
SECTION 2.08. Cancellation. All Notes surrendered for payment, registration
of transfer, exchange or redemption shall, if surrendered to any Person other
than the Indenture Trustee, be delivered to the Indenture Trustee and shall be
promptly cancelled by the Indenture Trustee. The Issuer may at any time deliver
to the Indenture Trustee for cancellation any Notes previously authenticated and
delivered hereunder which the Issuer may have acquired in any manner whatsoever,
and all Notes so delivered shall be promptly cancelled by the Indenture Trustee.
No Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Notes may be disposed of by the Indenture Trustee in
accordance with its standard practices.
SECTION 2.09. Book-Entry Notes. The Notes, upon original issuance, will be
issued in the form of typewritten Notes representing the Book-Entry Notes, to be
delivered to DTC, the initial Clearing Agency, by, or on behalf of, the Issuer
(except for any fractional units which cannot be accepted by DTC). Such Notes
shall initially be registered on the Note Register in the name of Cede & Co.,
the nominee of the initial Clearing Agency, and no Note Owner will receive a
Definitive Note representing such Note Owner's interest in such Note, except as
provided in Section 2.11. 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 shall be in full force and effect;
(ii) the Note Registrar and the Indenture Trustee shall be entitled to
deal with the Clearing Agency for all purposes of this Indenture (including
the payment of principal of and interest on the Notes and the giving of
instructions or directions hereunder) as the sole Holder of the Notes, and
shall have no obligation to the Note Owners;
(iii) to the extent that the provisions of this Section conflict with
any other provisions of this Indenture, the provisions of this Section
shall control;
(iv) the rights of Note Owners shall be exercised only through the
Clearing Agency and shall be limited to those established by law and
agreements between such Note Owners and the Clearing Agency 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 Noteholders evidencing a specified
percentage of the Note Balances, 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 Noteholders to the Clearing Agency, and shall
have no obligation to the Note Owners.
SECTION 2.11. Definitive Notes.
(a) 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 Note Balances 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.
(b) 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, 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 Pledged Assets. Subject to Section 13.01 and 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 and Independent Certificates in
accordance with Sections 314(c) and 314(d)(l) 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.
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 of the Issuer secured by the Pledged Assets. The Issuer, 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 of the Issuer.
SECTION 2.14. ERISA.
(a) Each purchaser or transferee of a Class A Note that is a Benefit Plan
(as such term is defined in ERISA) shall be deemed to have represented that the
relevant conditions for exemptive relief under Prohibited Transaction Class
Exemption ("PTCE") ▇▇-▇▇, ▇▇▇▇ ▇▇-▇, ▇▇▇▇ 91-38, PTCE 95-60 or PTCE 96-23, the
Underwriter Exemption or other applicable exemption providing substantially
similar relief have been satisfied.
(b) Each purchaser or transferee of a Class B Note that is a Benefit Plan
(as such term is defined in ERISA) shall be deemed to have represented that the
relevant conditions for exemptive relief under the Underwriter Exemption have
been satisfied.
SECTION 2.15. CUSIP Numbers.
The Issuer in issuing the notes may use "CUSIP" numbers (if then generally
in use), and, if so, the Indenture Trustee may use such "CUSIP" numbers in
notices of redemption as a convenience to the Holders; 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.
ARTICLE III
COVENANTS
SECTION 3.01. Payment of Principal and Interest. The Issuer will duly and
punctually pay Monthly Interest on and Monthly Principal of the Notes in
accordance with the terms of the Notes and this Indenture. Without limiting the
foregoing, subject to Section 9.04(a), the Issuer will cause to be distributed
the amount of Available Funds on a Payment Date. The Issuer will cause the
deposits received on Receivables to be deposited into the Collection Account
pursuant to the Trust Agreement for the benefit of the Noteholders. Amounts
properly withheld under the Code by any Person from a payment of interest and/or
principal to any Noteholder 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 9.02 of the Trust Agreement, 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 Spread Account, the
Pre-Funding Account or the Payahead 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 Spread Account, the Pre-Funding
Account or the Payahead Account for payments with respect to the Notes shall be
paid over to the Issuer except as provided in this Section.
(b) The Notes shall be non-recourse obligations of the Issuer and shall be
limited in right of payment to amounts available from the Pledged Assets and the
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.
(c) The Issuer will cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee and the Insurer 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 by the Paying Agent
or otherwise disposed of as herein provided;
(ii) give the Indenture Trustee 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.
(d) The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which 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 sums.
(e) Subject to applicable laws with respect to escheat of funds, any money
held by the Indenture Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Note and remaining unclaimed for two years
after such amount has become due and payable shall be discharged from such trust
and be paid to the Issuer upon receipt of an Issuer Request; and the Holder of
such Note shall thereafter, as an unsecured general creditor, look only to the
Issuer for payment thereof, and all liability of the Indenture Trustee or such
Paying Agent with respect to such trust money shall thereupon cease; provided,
however, that the Indenture Trustee or such Paying Agent, before being required
to make any such repayment, shall at the expense and direction of the Issuer
cause to be published once, in a newspaper published in the English language,
customarily published on each Business Day and of general circulation in The
City of New York, notice that such money remains unclaimed and that, after a
date specified therein, which shall not be less than 30 days from the date of
such publication, any unclaimed balance of such money then remaining will be
repaid to or for the account of the Issuer. The Indenture Trustee 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 it becomes, or any successor Issuer hereunder is or becomes,
organized under the laws of any other state or of the United States, in which
case the Issuer will keep in full effect its existence, rights and franchises
under the laws of such other jurisdiction) and will obtain and preserve its
qualification to do business in each jurisdiction in which such qualification is
or shall be necessary to protect the validity and enforceability of this
Indenture, the Notes, and the Pledged Assets.
SECTION 3.05. Protection of Trust Estate. The Issuer intends the security
interest Granted pursuant to this Indenture in favor of the Indenture Trustee on
behalf of the Noteholders to be prior to all other liens in respect of the
Pledged Assets, and the Issuer shall take all actions necessary to obtain and
maintain, for the benefit of the Indenture Trustee on behalf of the Noteholders,
a first lien on and a first priority, perfected security interest in the Pledged
Assets. The Issuer will from time to time execute and deliver all such
supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
all as prepared by the 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 Pledged Assets;
(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 Pledged Assets;
(v) preserve and defend title to the Pledged Assets and the rights of
the Indenture Trustee and the Noteholders in such Pledged Assets against
the claims of all persons and parties; or
(vi) pay all taxes or assessments levied or assessed upon the Pledged
Assets 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, which are
prepared and delivered to the Indenture Trustee.
SECTION 3.06. Opinions as to Pledged Assets.
(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 UCC financing statements and continuation statements
have been executed or duly authorized and filed that are necessary to create and
continue the Indenture Trustee's first priority perfected security interest in
the Pledged Assets (subject to the rights of the Insurer under the Insurance
Agreement) for the benefit of the Noteholders, and reciting the details of such
filings or referring to prior Opinions of Counsel in which such details are
given, or (ii) no such action shall be necessary to perfect such security
interest.
(b) Within 90 days after the beginning of each calendar year beginning with
the first calendar year beginning more than three months after the Cutoff Date,
the Issuer shall furnish to the Indenture Trustee and the Insurer an Opinion of
Counsel, dated as of such 90th day, to the effect that, in the opinion of such
counsel, either (i) all UCC financing statements and continuation statements
have been executed or duly authorized and filed that are necessary to create and
continue the Indenture Trustee's first priority perfected security interest in
the Pledged Assets (subject to the rights of the Insurer under the Insurance
Agreement) for the benefit of the Noteholders, and reciting the details of such
filings or referring to prior Opinions of Counsel in which such details are
given, or (ii) no such action shall be necessary to perfect such security
interest. Such Opinion of Counsel shall also specify any financing statements or
continuation statements or other actions necessary (based on the laws in effect
and the facts known as of the date of such opinion) to be executed and filed on
or before March 31 of the following year to preserve and protect such interest.
SECTION 3.07. Performance of Obligations; Successor Servicer.
(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 Pledged Assets or that would result in the amendment,
hypothecation, subordination, termination or discharge of, or impair the
validity or effectiveness of, any such instrument or agreement, except as
expressly provided in the Basic Documents or such other instrument or agreement.
(b) The Issuer may contract with or otherwise obtain the assistance of
other Persons (including, without limitation, the Administrator under the
Administration Agreement) 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. The Indenture Trustee shall not be
responsible for the action or inaction of the Servicer or the Administrator.
Initially, the Issuer has contracted with UAC as the Administrator to assist the
Issuer in performing its duties under this Indenture.
(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 Pledged Assets, 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 Trust Agreement in accordance with and within the time periods provided for
herein and therein. Except as otherwise expressly provided therein, the Issuer
shall not waive, amend, modify, supplement or terminate any Basic Document or
any provision thereof without the consent of the Indenture Trustee, the Insurer
(unless an Insurer Default has occurred and is continuing) and the Holders of at
least a majority of the Outstanding Note Balances of the Notes.
(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 to such default. If a Servicer
Default shall arise from the failure of the Servicer to perform any of its
duties or obligations under the Trust Agreement with respect to the Receivables,
the Issuer shall take all reasonable steps available to it to remedy such
failure.
(e) Upon the resignation or termination of the Servicer pursuant to Section
13.05 or 14.01 of the Trust Agreement, the Indenture Trustee shall appoint a
successor Servicer acceptable to the Insurer. If the Indenture Trustee shall
succeed to the Servicer's duties as servicer of the Receivables as provided in
Section 14.02 of the Trust Agreement, it shall do so in its individual capacity
and not in its capacity as Indenture Trustee and, accordingly, the provisions of
Article Six shall be inapplicable to the Indenture Trustee in its duties as the
successor to the Servicer and the servicing of the Receivables. In case the
Indenture Trustee shall become successor to the Servicer under the Trust
Agreement, the Indenture Trustee shall be entitled to appoint as Servicer one of
its Affiliates; provided that it shall not be liable for the actions and
omissions of any such Affiliate in such capacity as successor Servicer appointed
with due care.
(f) Upon any termination of the Servicer's rights and powers pursuant to
the Trust Agreement, the Issuer shall promptly notify the Indenture Trustee and
the Insurer. As soon as a successor Servicer is appointed, the Issuer shall
notify the Indenture Trustee and the Insurer of such appointment, specifying in
such notice the name and address of such successor Servicer.
(g) The Issuer agrees that it will not waive timely performance or
observance by the Servicer or the Seller of their respective duties under the
Basic Documents: (i) without the prior consent of the Insurer (unless an Insurer
Default shall have occurred and be continuing) or (ii) if the effect thereof
would adversely affect the Noteholders.
SECTION 3.08. Negative Covenants. Until the Termination Date, the Issuer
shall not:
(i) except as expressly permitted by the Basic Documents, sell,
transfer, exchange or otherwise dispose of any of the properties or assets
of the Issuer, including those included in the Pledged Assets, unless
directed to do so by the Indenture Trustee with the prior written consent
of the Insurer (unless an Insurer Default shall have occurred and be
continuing);
(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 any part of the Pledged
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 Pledged Assets or any
part thereof or any interest therein or the proceeds thereof (other than
tax liens, mechanics' liens and other liens that arise by operation of law,
in each case on a Financed Vehicle and arising solely as a result of an
action or omission of the related Obligor), (C) permit the lien created by
this Indenture not to constitute a valid first priority security interest
(other than with respect to any such tax, mechanics' or other lien) in the
Pledged Assets; or
(iv) 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 April 30 of each year,
beginning on the first April 30 that is at least six months after the Closing
Date, an Officer's Certificate dated as of December 31 of the preceding year
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
the Issuer's performance under this Indenture has been made under such
Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, based on such
review, the Issuer has complied with all conditions and covenants under
this Indenture 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 Conditions.
(a) The Issuer shall not consolidate or merge with or into any other
Person, unless:
(i) the Person (if other than the Issuer) formed by or surviving such
consolidation or merger shall (A) be a Person organized and existing under
the laws of the United States or any State, (B) expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture
Trustee and the Insurer, in form and substance satisfactory to the
Indenture Trustee and the Insurer (so long as no Insurer Default shall have
occurred and be continuing), 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,
and (C) 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 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, the Insurer, any Noteholder
or any Certificateholder;
(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 Three 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) so long as no Insurer Default shall have occurred and be
continuing, 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 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 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 Pledged Assets, to any
Person (except 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,
(B) 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 no
Insurer Default shall have occurred and be continuing), the due and
punctual payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this Indenture
and each other Basic Document on the part of the Issuer to be performed or
observed, all as provided herein, (C) expressly agree by means of such
supplemental indenture that all right, title and interest so conveyed or
transferred shall be subject and subordinate to the rights of Noteholders,
(D) unless otherwise provided in such supplemental indenture, expressly
agree to indemnify, defend and hold harmless the Issuer against and from
any loss, liability or expense arising under or related to this Indenture
and the Notes and (E) expressly agree by means of such supplemental
indenture that such Person (or if a group of Persons, then one specified
Person) shall make all filings with the Commission (and any other
appropriate Person) required by the Exchange Act in connection with the
Notes;
(ii) immediately after giving effect to such 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 (so long as no Insurer Default shall have occurred and be
continuing) to the effect that such conveyance or transfer will not have
any material adverse tax consequence to the Trust, the Insurer, any
Noteholder or any Certificateholder;
(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 conveyance or transfer and
such supplemental indenture comply with this Article Three 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 or substantially all the assets or
properties of the Issuer pursuant to Section 3.10(b), the Issuer will be
released from every covenant and agreement of this Indenture to be observed or
performed on the part of the Issuer with respect to the Notes 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 (i) any
business other than financing, purchasing, owning, selling and managing the
Receivables in the manner contemplated by this Indenture and the other Basic
Documents and activities incidental thereto or (ii) any other business or
activities as contemplated by Section 1.03 of the Trust Agreement.
SECTION 3.13. Servicer's Obligations. The Issuer shall cause the Servicer
to comply with the Servicer's obligations under the Trust Agreement.
SECTION 3.14. Restricted Payments. Except as expressly permitted by the
Basic Documents, the Issuer shall not, directly or indirectly, (i) pay any
dividend or make any distribution (by reduction of capital or otherwise),
whether in cash, property, securities or a combination thereof, to the Owner
Trustee or any owner of a beneficial interest in the Issuer or otherwise with
respect to any ownership or equity interest or security in or of the Issuer or
to the Servicer, (ii) redeem, purchase, retire or otherwise acquire for value
any such ownership or equity interest or security or (iii) set aside or
otherwise segregate any amounts for any such purpose; provided, however, that
the Issuer may make, or cause to be made, distributions to the Servicer, the
Indenture Trustee, the Owner Trustee, the Insurer, the Noteholders and the
Certificateholder as contemplated by, and to the extent funds are available for
such purpose under, the Trust Agreement. The Issuer will not, directly or
indirectly, make payments to or distributions from the Collection 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 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 Trust Agreement.
SECTION 3.16. Further Instruments and Acts. Upon request of the Indenture
Trustee or the Insurer, 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. 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.
SECTION 3.18. Amendments of Trust Agreement. The Issuer shall not agree to
any amendment to Section 17.01 of the Trust Agreement to eliminate the
requirements thereunder that the Noteholders consent to amendments thereto as
provided therein.
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, (iv) Sections 3.03, 3.04, 3.05, 3.07,
3.08, 3.10, 3.11, 3.12, 3.17 and 3.18, (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 Policy, which shall survive the Final Maturity Date of
the Class B 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 Policy has expired and 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 Maturity Date of
the Class B 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,
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 Eligible Investments for such purpose, in an amount sufficient to pay and
discharge the entire indebtedness on such Notes not theretofore delivered to the
Indenture Trustee for cancellation when due to the Final Maturity Date of the
Class B Notes or the Redemption Date (if Notes shall have been called for
redemption pursuant to Section 12.01), 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 for the benefit of the Noteholders under this Indenture or the
Notes and (2) the Insurer under this Indenture and the Basic Documents; 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, the
Indenture Trustee) an Independent Certificate from a firm of certified public
accountants, each meeting the applicable requirements of Section 13.01(a) and,
subject to Section 13.02, 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 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; but such
monies need not be segregated from other funds except to the extent required
herein or in the Trust 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.
ARTICLE V
EVENTS OF DEFAULT; REMEDIES
SECTION 5.01. Events of Default.
(a) "Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(i) default in the payment of any interest on any Note when the same
becomes due and payable and such default shall continue for a period of
five days after notice thereof is given to the Issuer by the Indenture
Trustee, the Insurer or the Servicer, or to the Issuer and the Indenture
Trustee by the Holders of at least 25% of the Note Balances;
(ii) default in the payment of any principal due and payable on a
Class of Notes on the Final Maturity Date for such Class of Notes and such
default shall continue for a period of five days after notice thereof is
given to the Issuer by the Indenture Trustee, the Insurer or the Servicer,
or to the Issuer and the Indenture Trustee by the Holders of at least 25%
of the Note Balances;
(iii) (A) 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 elsewhere
in this Section specifically dealt with), and such default shall continue
or not be cured for a period of 60 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 and the Indenture
Trustee by the Holders of at least 25% of the Note Balances or (B) 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 and the
Indenture Trustee by the Holders of at least 25% of the Note Balances of
the Notes;
(iv) 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 Pledged Assets 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 Pledged Assets, or ordering the winding-up or
liquidation of the Issuer's affairs, and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or
(v) 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 Pledged Assets, 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;
provided, however, that so long as no Insurer Default shall have occurred and be
continuing and the Policy shall be in effect, neither the Indenture Trustee nor
the Noteholders may declare an Event of Default under the Indenture. So long as
no Insurer Default shall have occurred and be continuing and the Policy shall be
in effect, 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 Maturity Date for such Class of Notes.
(b) The Issuer shall deliver to the Indenture Trustee and the Insurer,
within five days after obtaining knowledge of the occurrence thereof, written
notice in the form of an Officer's Certificate of any event which with the
giving of notice or the lapse of time would become an Event of Default, its
status and what action the Issuer is taking or proposes to take with respect
thereto.
SECTION 5.02. Rights Upon Event of Default.
(a) So long as no Insurer Default shall have occurred and be 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, the Servicer and the
Indenture Trustee that 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 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 Policy with respect to the Notes.
(b) If an Insurer Default shall have occurred and be continuing or the
Policy shall have terminated in accordance with its terms, and an Event of
Default shall have occurred and be continuing, the Indenture Trustee shall, if
so requested in writing by the Noteholders representing at least 66 2/3% of the
Note Balances, upon prior written notice to each Rating Agency, declare that 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.
(c) Following any Event of Default, the Insurer may elect to prepay all or
any portion of the outstanding amount of the Notes, plus accrued interest
thereon to the date of payment and shall be subrogated to the rights of such
Noteholders; provided, however, that the Insurer shall fulfill its obligations
under the Policy.
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.
(a) The Issuer covenants that, if the Notes are accelerated following the
occurrence of an Event of Default, the Issuer will, upon demand of the Indenture
Trustee, pay to the Indenture Trustee, for the benefit of the Noteholders, the
whole amount then due and payable on such Notes for principal and interest, with
interest upon the overdue principal, and, to the extent payment at such rate of
interest shall be legally enforceable, upon overdue installments of interest, at
the applicable interest rates, 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 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 or the Policy shall have terminated in
accordance with its terms, at the direction of the Noteholders representing at
least 66 2/3% of the Note Balances, as more particularly provided in Section
5.04, proceed to protect and enforce the rights of the Noteholders, by such
appropriate Proceedings as the Indenture Trustee shall deem most effective to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy or legal or equitable
right vested in the Indenture Trustee by this Indenture or by law.
(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 Pledged Assets, 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, shall be
entitled and empowered, by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to file
such other papers or documents as may be necessary or advisable in order to
have the claims of the Indenture Trustee (including any claim for
reasonable compensation to the Indenture Trustee, 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;
(ii) unless prohibited by applicable law and regulations, to vote on
behalf of the Noteholders in any election of a trustee, a standby trustee
or Person performing similar functions in any such Proceedings;
(iii) to collect and receive any monies or other property payable or
deliverable on any such claims and to 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 Noteholders 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.
(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 Noteholders.
(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.
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) below 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 shall have occurred and be
continuing, the Indenture Trustee shall (subject to Section 5.04(b) below and
Section 5.05), if an Insurer Default shall have occurred and be continuing or if
the Policy shall have terminated in accordance with its terms, at the direction
of the Noteholders representing at least 66 2/3% of the Note Balances, 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 Pledged Assets;
(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 under this Indenture or the
Notes;
(iv) sell or cause the Servicer to otherwise liquidate the Pledged
Assets 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 Pledged Assets.
(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, if an Event of Default specified in Section 5.01(a)(i), (ii) or
(iii) 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 Pledged Assets in
whole or in part if the Indenture Trustee reasonably believes that the
proceeds of such sale or liquidation would not be sufficient to pay all
outstanding principal of and accrued interest on the Notes; and
(ii) in the event that the Indenture Trustee is acting at the
direction of the Noteholders representing at least 66 2/3% of the Note
Balances, (so long as an Insurer Default shall have occurred and be
continuing), 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 Pledged Assets in whole or in part unless
an Event of Default as specified in Section 5.01(a)(iv) or (v) shall have
occurred and be continuing.
(c) In determining the sufficiency or insufficiency of the proceeds of a
sale or liquidation of the Pledged Assets to pay all amounts required pursuant
to Section 5.04(b)(i) 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 Pledged
Assets for such purpose.
SECTION 5.05. Optional Preservation of the Receivables. If the Notes shall
have been declared to be due and payable under Section 5.02 following an Event
of Default and such declaration and its consequences shall not have been
rescinded and annulled, the Indenture Trustee shall, absent direction to the
contrary from the Insurer or the Noteholders pursuant to Section 5.04, maintain
possession of the Pledged Assets.
SECTION 5.06. Priorities.
(a) If the Notes shall have been declared to be due and payable under
Section 5.02 following an Event of Default and such declaration and its
consequences shall not have been rescinded and annulled, any money collected by
the Indenture Trustee with respect to the Pledged Assets 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 Pledged Assets or the
Notes (excluding any payments made under the Policy), shall be applied as
follows, notwithstanding the provisions of Section 9.04(a) to the contrary:
(i) first, to pay any unpaid Monthly Servicing Fee, any unpaid
Successor Servicing Fee, any unpaid Transition Costs and Outstanding
Advances to the Servicer;
(ii) second, to pay any accrued and unpaid fees of the Indenture
Trustee and the Owner Trustee without preference or priority of any kind;
(iii) third, to pay Monthly Interest on each Class of Class A Notes on
a pro rata basis based on the interest accrued (including interest accrued
on past due interest) on each Class of Class A Notes;
(iv) fourth, to pay principal on each Class of Class A Notes, on a pro
rata basis based on the Note Balance of each Class of Class A Notes, until
the Note Balance of each Class of Class A Notes is reduced to zero;
(v) fifth, to pay Monthly Interest on the Class B Notes (including
interest accrued on past due interest);
(vi) sixth, to pay principal on the Class B Notes until the Class B
Note Balance is reduced to zero;
(vii) seventh, to pay the aggregate amount of all unreimbursed draws
made on the Policy in respect of the Monthly Servicing Fee, Monthly
Interest and Monthly Principal, plus accrued interest thereon at the rate
provided in the Insurance Agreement;
(viii) eighth, to pay any other amounts owing under the Insurance
Agreement, including, without limitation, any Insurer Defense Costs; and
(ix) ninth, to the Spread Account to be applied in accordance with
Section 10.02 hereof and in accordance with the Trust Agreement.
(b) The Indenture Trustee may 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 Issuer shall mail to each Noteholder and the Indenture Trustee
a notice that states the record date, the payment date and the amount to be
paid.
SECTION 5.07. Limitation of Suits.
(a) 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 shall have previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the Note Balances shall 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 shall have offered to the Indenture
Trustee indemnity reasonably satisfactory to it against the costs, expenses
and liabilities to be incurred in complying with such request;
(iv) the Indenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity shall have failed to institute such
Proceedings;
(v) no direction inconsistent with such written request shall have
been given to the Indenture Trustee during such 60-day period by the
Holders of a majority of the Note Balances; and
(vi) an Insurer Default shall have occurred and be continuing, or the
Policy shall have terminated in accordance with its terms.
It is understood and intended that no one or more Noteholders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other
Noteholders or to obtain or to seek to obtain priority or preference over any
other Holders or to enforce any right under this Indenture, except in the manner
herein provided.
(b) In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Noteholders, each
representing less than a majority of the Note Balances of the Notes, the
Indenture Trustee in its sole discretion may determine which 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
payments of Monthly Interest and Monthly Principal 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 shall have instituted any Proceeding to enforce
any right or remedy under this Indenture and such Proceeding shall have been
discontinued or abandoned for any reason or shall have been determined adversely
to the Indenture Trustee, the Insurer or to 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 and the Noteholders shall continue as
though no such Proceeding had been instituted.
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 Five 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. The Insurer, or if any Insurer
Default shall have occurred and be continuing, the Holders of a majority of the
Note Balances 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
Pledged Assets 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.
(a) Prior to the declaration of the acceleration of the maturity of the
Notes as provided in Section 5.02, the Insurer or, if an Insurer Default shall
have occurred and be continuing, the Noteholders representing not less than a
majority of the Note Balances, may waive any past Default or Event of Default
and/or 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 Noteholders shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend to
any subsequent or other Default or impair any right consequent thereto.
(b) 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; 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 attorneys' fees and expenses,
against any party litigant in such suit, in the manner and to the extent
provided by the Trust Indenture Act; but the provisions of this Section shall
not apply to (i) any suit instituted by the Indenture Trustee, (ii) any suit
instituted by any Noteholder, or group of Noteholders, in each case holding in
the aggregate more than 10% of the Note Balances 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 any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law or any valuation or appraisement 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, 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 or the Noteholders shall be impaired by the recovery of
any judgment by the Indenture Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Pledged Assets 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.
SECTION 5.17. Performance and Enforcement of Certain Obligations.
(a) Promptly following a request from the Controlling Party to do so and at
the Administrator's expense, the Issuer shall take all such lawful action as the
Controlling Party may request to compel or secure the performance and observance
by the Seller and the Servicer as applicable, of each of their obligations to
the Issuer under or in connection with the Trust Agreement in accordance with
the terms thereof, and to exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuer under or in connection with the
Trust Agreement to the extent and in the manner directed by the Controlling
Party, including the transmission of notices of default on the part of the
Seller or the Servicer thereunder and the institution of legal or administrative
actions or Proceedings to compel or secure performance by the Seller or the
Servicer of each of their obligations under the Trust Agreement.
(b) If the Indenture Trustee is the Controlling Party and if an Event of
Default shall have occurred and be 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 Note Balances shall, exercise all
rights, remedies, powers, privileges and claims of the Issuer against the Seller
or the Servicer under or in connection with the Trust 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 Trust Agreement, and any right of the Issuer to
take such action shall be suspended.
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.01. Duties of Indenture Trustee.
(a) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and with the same degree of care and skill in its exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs; provided, however, 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 shall be read into this Indenture against the
Indenture Trustee; and
(ii) in the absence of bad faith on its part, the Indenture Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; however, 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, however, 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 willful
misconduct, except that:
(i) this paragraph does not limit the effect of Section 6.01(b);
(ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is proved
that the Indenture Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Indenture Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 5.12.
(d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Indenture Trustee shall not be liable for interest on any money
received by it.
(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 Trust 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 adequate indemnity against such risk or liability is not
reasonably 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 Trust Agreement and
(ii) hold the Policy in trust, and will hold any proceeds of any claim on the
Policy in trust solely for application as provided in the Trust Agreement.
(j) The Indenture Trustee shall have no discretionary duties other than
performing those ministerial acts set forth in this Indenture to accomplish the
purpose of this Trust as set forth in this Indenture or as otherwise required
under the TIA.
(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 at the direction of Holders of Notes
evidencing a majority of the Outstanding Note Balances, 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.
(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 received written notice
thereof. In the absence of 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, the Indenture
Trustee shall have no duty (i) to see to any recording, filing, or depositing of
this Indenture or any agreement referred to herein or any UCC 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 Pledged Assets, 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) Anything in this Indenture to the contrary notwithstanding, in no event
shall the Indenture Trustee be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including but not limited to lost
profits), even if the Indenture Trustee has been advised of the likelihood of
such loss or damage, regardless of the form of action.
(o) Notwithstanding the foregoing or any other provision in this Indenture
to the contrary, the Indenture Trustee shall be liable in its commercial
capacity for losses attributable to its failure to make payments on Eligible
Investments issued by the Indenture Trustee in its commercial capacity as
principal obligor and not as Indenture Trustee, in accordance with the terms of
the agreements or instruments governing any such Eligible Investments;
(p) The Indenture Trustee shall acknowledge and accept the Administration
Agreement on behalf of the Secured Parties.
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, shall examine them to determine whether they comply as to form to the
requirements of this Indenture.
(b) Before the Indenture Trustee acts or refrains from acting, it may
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 and the Indenture Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent,
attorney, custodian or nominee appointed by the Indenture Trustee with due care.
(d) The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however, that 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 Notes shall be full and complete authorization and protection from liability
in respect to any action taken, omitted or suffered by it hereunder in good
faith and in accordance with the advice or opinion of such counsel.
(f) The 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 reasonably satisfactory to it against the costs, expenses
and liabilities which may be incurred therein or thereby.
(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, however, 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 Indenture, the Indenture Trustee
may require indemnity reasonably satisfactory to it 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 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 Pledged Assets 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 shall have occurred and be
continuing and a Responsible Officer of the Indenture Trustee shall have actual
knowledge or shall have received written notice thereof, the Indenture Trustee
shall mail to each Noteholder and the Insurer notice of the Default within 90
days after it shall have occurred. 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 if and so
long as one 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 it customarily
provides to enable such Holder to prepare its federal and state income tax
returns.
SECTION 6.07. Compensation and Indemnity.
(a) The Issuer shall cause the Servicer to pay to the Indenture Trustee
from time to time reasonable compensation for its services. The Indenture
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuer shall cause the Servicer 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. Such expenses shall include the reasonable compensation and expenses
and disbursements and advances of the Indenture Trustee's agents, counsel,
accountants and experts. The Issuer shall, or shall cause the Administrator to,
indemnify the Indenture Trustee against any and all loss, liability or expense
(including attorneys' fees and expenses) incurred by it in connection with the
administration of this trust and the performance of its duties hereunder. The
Indenture Trustee shall notify the Issuer and the Administrator promptly 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. 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.
(b) 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(e) or (f) 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.
(a) 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, unless an Insurer Default shall have occurred and be continuing or
if the Policy shall have terminated in accordance with its terms, at the request
of the Insurer shall, remove the Indenture Trustee if:
(i) the Indenture Trustee shall have failed 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 shall have commenced 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 shall have consented 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 shall have made any assignment for the benefit of creditors or
shall have failed generally to pay its debts as such debts become due or
shall have taken any corporate action in furtherance of any of the
foregoing; or
(iv) the Indenture Trustee otherwise shall have become incapable of
acting.
(b) 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.
(c) A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee 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.
(d) If a successor Indenture Trustee shall not have taken office within 30
days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Holders of a majority of the Outstanding
Note Balances may, at the expense of the Issuer, petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee.
(e) If the Indenture Trustee shall have failed to comply with Section 6.11,
any Noteholder may petition any court of competent jurisdiction for the removal
of the Indenture Trustee and the appointment of a successor Indenture Trustee.
(f) 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 and payment of all fees and expenses owed to
the outgoing Indenture Trustee. 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.
(a) If the Indenture Trustee consolidates with, merges or converts into, or
transfers all or substantially all of 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
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.
(b) 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, 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 and effect of the certificate of the Indenture Trustee
pursuant to the Notes or this Indenture.
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 Pledged Assets may at the time be located, the Indenture Trustee
shall have the power to 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, and to vest in such Person or Persons, in such capacity and for
the benefit of the Noteholders, such title to the Pledged Assets, or any part
hereof, and, subject to the other provisions of this Section, such powers,
duties, obligations, rights and trusts as the Indenture Trustee may consider
necessary or desirable. No co-trustee or separate trustee 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.
(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 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
(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. The Indenture Trustee shall at all times satisfy
the requirements of TIA Section 310(a). The Indenture Trustee hereunder shall at
all times be a financial institution organized and doing business under the laws
of the United States of America or any state, authorized under such laws to
exercise corporate trust powers, whose long term unsecured debt is rated at
least Baa3 by ▇▇▇▇▇'▇ and shall have a combined capital and surplus of at least
$50,000,000 or shall be a member of a bank holding system the aggregate combined
capital and surplus of which is $50,000,000 and subject to supervision or
examination by federal or state authority, provided that the Indenture Trustee's
separate capital and surplus shall at all times be at least the amount required
by Section 310(a)(2) of the TIA. If such Person publishes reports of condition
at least annually, pursuant to law or to the requirements of a supervising or
examining authority, then for the purposes of this Section 6.11, the combined
capital and surplus of such Person shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so published. In
case at any time the Indenture Trustee shall cease to be eligible in accordance
with the provisions of this Section 6.11, the Indenture Trustee shall resign
immediately in the manner and with the effect specified in Section 6.08. The
Indenture Trustee shall comply with TIA Section 310(b); provided, however, that
there shall be excluded from the operation of TIA Section 310(b)(1) any
indenture or indentures under which other securities of the Issuer are
outstanding if the requirements for such exclusion set forth in TIA Sections
310(b)(1) are met.
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 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:
(a) the Indenture Trustee is a corporation duly organized, validly existing
and in good standing under the laws of its place of incorporation;
(b) the Indenture Trustee has full power, authority and legal right to
execute, deliver, and perform this Indenture and has taken all necessary action
to authorize the execution, delivery and performance by it of this Indenture;
and
(c) this Indenture has been duly executed and delivered by the Indenture
Trustee and constitutes the legal, valid, and binding agreement of the Indenture
Trustee, enforceable in accordance with its terms, except as such enforceability
may be limited by (i) bankruptcy, insolvency, liquidation, reorganization,
moratorium, conservatorship, receivership or other similar laws now or
hereinafter in effect relating to the enforcement of creditors' rights in
general, as such laws apply in the event of a bankruptcy, insolvency,
liquidation, reorganization, moratorium, conservatorship, receivership or
similar occurrence affecting the Indenture Trustee, and (ii) general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law) as well as concepts of reasonableness, good
faith and fair dealing.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.01. Issuer to Furnish Names and Addresses of Noteholders. The
Issuer will furnish or cause to be furnished to the Indenture Trustee or the
Servicer (i) not more than five days after the earlier of (1) each Record Date
and (2) three months after the last Record Date, a list, in such form as the
Indenture Trustee may reasonably require, of the names and addresses of the
Noteholders as of such Record Date and (ii) at such other times as the Indenture
Trustee may request in writing, within 15 days after receipt by the Issuer of
any such request, a list of similar form and content as of a date not more than
ten days prior to the time such list is furnished; provided, however, that so
long as the Indenture Trustee is the Note Registrar, no such list shall be
required to be furnished to the Indenture Trustee, but shall be provided by the
Note Registrar to the Servicer, upon request, as provided above. 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 Noteholders contained in
the most recent list furnished to the Indenture Trustee as provided in Section
7.01 and the names and addresses of Noteholders received by the Indenture
Trustee in its capacity as Note Registrar. The Indenture Trustee may destroy any
list furnished to it as provided in such Section 7.01 upon receipt of a new list
so furnished.
(b) Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall have the
protection of TIA Section 312(c).
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 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.
(b) Unless the Issuer otherwise determines, the fiscal year of the Issuer
shall end on June 30 of each year.
(c) Subject to Section 6.01, delivery of such reports, information and
documents to the Indenture Trustee is for informational purposes only and the
Indenture Trustee's receipt of such shall not constitute constructive notice of
any information contained therein or determinable from information contained
therein, including the Issuer's compliance with any of its covenants hereunder
(as to which the Indenture Trustee is entitled to conclusively rely exclusively
on Officer's Certificates).
SECTION 7.04. 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 the first
December which is greater than three months from the date hereof, 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).
ARTICLE VIII
INTENTIONALLY BLANK
ARTICLE IX
DISTRIBUTIONS; STATEMENTS TO THE NOTEHOLDERS
SECTION 9.01. Collection Account. The Issuer shall cause the Seller to
establish the Collection Account with the Indenture Trustee or another Eligible
Bank as a segregated trust account in the name of the Indenture Trustee for the
benefit of the Secured Parties. The amounts in the Collection Account shall be
invested upon receipt of written direction from the Seller in Eligible
Investments specified in such direction that mature not later than the Business
Day prior to the next succeeding Payment Date and such Eligible Investments
shall be held to maturity. The Indenture Trustee (or its custodian) shall (i)
maintain possession of any negotiable instruments or securities evidencing
Eligible Investments until the time of sale or maturity and each certificated
security or negotiable instrument evidencing an Eligible Investment shall be
endorsed in blank or to the Indenture Trustee or registered in the name of the
Indenture Trustee and (ii) cause any Eligible Investment represented by an
uncertificated security to be registered in the name of the Indenture Trustee.
SECTION 9.02. Collections. The Indenture Trustee shall review the
Servicer's Certificate prepared by the Servicer immediately upon receipt thereof
pursuant to Section 8.09 of the Trust Agreement.
For any Payment Date on which there will not be sufficient Available Funds
to make the distributions required pursuant to Sections 9.04(a)(i) through
(vii), the Indenture Trustee shall withdraw or direct the Servicer to withdraw
from the Spread Account, to the extent of the Available Spread Amount, an amount
equal to such deficiency and promptly deposit such amount in the Collection
Account; or, if the Notes shall have been declared to be due and payable under
Section 5.02 following an Event of Default, for any Payment Date on which there
will not be sufficient Available Funds to make the distributions required
pursuant to Sections 5.06(a)(i) through (vii), but excluding any distributions
required by Section 5.06(a)(ii) and Sections 5.06(a) (iv) or (vi) in an amount
in excess of the amount, if any, required to reduce the aggregate Note Balances
as of the prior Payment Date (after giving effect to any distributions on the
prior Payment Date) to the Pool Balance at the end of the related Collection
Period, the Indenture Trustee shall withdraw or direct the Servicer to withdraw
from the Spread Account, to the extent of the Available Spread Amount, an amount
equal to such deficiency and promptly deposit such amount in the Collection
Account. In either case, if such deficiency exceeds the Available Spread Amount,
the Indenture Trustee shall notify the Insurer of the amount of such excess
deficiency. To the extent the Insurer is required pursuant to the terms of the
Policy to pay the amount of such excess deficiency of the Monthly Servicing Fee,
Monthly Interest and Monthly Principal, the Indenture Trustee shall promptly
(and in any event not later than 1:00 p.m., New York City time, on the Business
Day preceding the Payment Date) deliver a Notice for Payment as defined in the
Policy (appropriately completed) to the Fiscal Agent with respect to the Policy.
The Indenture Trustee shall, immediately upon receipt, deposit in the
Collection Account any funds received by the Indenture Trustee in respect of
funds drawn under the Policy from the Insurer.
SECTION 9.03. Purchase Amounts. Pursuant to the Trust Agreement, the
Servicer and the Seller have agreed to remit to the Collection Account not later
than the Determination Date, the aggregate Purchase Amount for such Collection
Period pursuant to Sections 7.02 and 8.07 of the Trust Agreement. Not later than
11:00 a.m. (New York City time) on the related Payment Date the Servicer shall
remit to the Collection Account the aggregate Optional Disposition Price for
Receivables on such Payment Date pursuant to Section 16.02 of the Trust
Agreement.
SECTION 9.04. Distributions to Parties.
(a) On each Payment Date (unless the Notes shall have been declared to be
due and payable under Section 5.02 following an Event of Default), the Indenture
Trustee shall apply or cause to be applied the Available Funds in the Collection
Account for the prior Collection Period (plus any amounts withdrawn from the
Pre-Funding Account or the Spread Account, or drawn on the Policy pursuant to
Section 9.02), to make the following payments in the listed order of priority:
(i) Without duplication, an amount equal to the sum of (y) Outstanding
Advances on all Receivables that became Defaulted Receivables during the
prior Collection Period, plus (z) Outstanding Advances which the Servicer
determines to be unrecoverable pursuant to Section 9.05 of the Trust
Agreement, to the Servicer;
(ii) To the extent not previously distributed to the Servicer, the
Monthly Servicing Fee, any unpaid Transition Costs and the Successor
Servicing Fee, if any, including any such overdue Monthly Servicing Fee and
overdue Successor Servicing Fee, if any, to the Servicer;
(iii) Class A Monthly Interest (including any overdue amounts) to the
Class A Noteholders;
(iv) Class B Monthly Interest (including any overdue amounts) to the
Class B Noteholders, except that such payment will be subordinate to
Monthly Principal payable to Class A Noteholders under clause (v) to the
extent of principal in respect of a Final Maturity Date for a Class of
Class A Notes on any Payment Date on which the amount of Available Funds,
plus funds withdrawn from the Spread Account or drawn on the Policy will
not be sufficient to fully pay the Note Balance of such Class of Class A
Notes.
(v) Monthly Principal (including any overdue amounts) to the Class A
Noteholders, in accordance with the Principal Payment Sequence;
(vi) Monthly Principal (including any overdue amounts) to the Class B
Noteholders in accordance with the Principal Payment Sequence;
(vii) The Insurance Premium, including any overdue Insurance Premium,
plus accrued interest thereon at the rate provided in the Insurance
Agreement, to the Insurer;
(viii) The amount of Recoveries of Advances, to the Servicer (to the
extent not applied pursuant to (i) above on or prior to such Payment Date);
(ix) The aggregate amount of all unreimbursed draws made on the Policy
in respect of the Monthly Servicing Fee, Monthly Interest and Monthly
Principal and any other amounts payable to the Insurer under the Insurance
Agreement, including any Insurer Defense Costs, plus accrued interest
thereon at the rate provided in the Insurance Agreement, to the Insurer;
(x) The balance for deposit in the Spread Account. The rights of the
Certificateholder to receive distributions from the Spread Account are
described in Sections 10.02(e) and (f).
(b) (i) If on any Payment Date (other than a Payment Date after the Notes
shall have been declared to be due and payable under Section 5.02 following
an Event of Default) there are not sufficient Available Funds to pay the
distributions required by Section 9.04(a)(iii) through (vi), then the
Available Funds (together with amounts withdrawn from the Spread Account
and/or drawn on the Policy, as applicable) payable under Section
9.04(a)(iii) through (vi) shall be allocated first to Class A Noteholders
pari passu for the payment of Class A Monthly Interest, second to the Class
B Noteholders in respect of Class B Monthly Interest, third to the Class A
Noteholders pari passu in respect of Class A Monthly Principal, and finally
the Class B Noteholders in respect of Class B Monthly Principal. The amount
of Monthly Interest allocated to Class A Noteholders shall be based upon
the amount of interest due each Class of Class A Noteholders and the amount
of Monthly Principal allocated to each Class of Class A Noteholders shall
be based upon the relative Outstanding Note Balance of each Class of Class
A Notes.
(ii) Notwithstanding the foregoing, if on any Payment Date, the
Servicer exercises its option to cause a disposition of the remaining
corpus of the Trust pursuant to Section 16.02 of the Trust Agreement: (a)
the Available Funds and amounts withdrawn from the Spread Account or drawn
on the Policy in respect only of Monthly Interest and Monthly Principal
payable to the Noteholders with respect to the immediately preceding
Payment Date as determined in accordance with Sections 9.02 and 9.04 shall
be distributed to the Noteholders on such Payment Date; (b) the Policy will
not be available to pay any shortfall of Monthly Interest or Monthly
Principal payable to the Noteholders after a prepayment of the Note
Balances pursuant to this Section 9.04(b)(ii); and (c) any remaining
Pledged Assets (including all remaining Available Spread Amounts) shall be
paid to the Noteholders on such Payment Date until the Note Balances shall
have been reduced to zero. Any amounts in excess thereof shall be remitted
to the Certificateholder pursuant to the Trust Agreement.
(iii) In making such payments the Indenture Trustee shall be entitled
to rely (without investigation, confirmation or recalculation) upon all
information and calculations contained in the Servicer's Certificate
delivered to the Indenture Trustee pursuant to Section 8.09 of the Trust
Agreement.
(iv) All monthly payments shall be made by wire transfer of
immediately available funds to the Noteholder of record on the preceding
Record Date. Notwithstanding the foregoing, the final payment on the Notes
shall be made only against presentation and surrender of the Notes at the
office or agency then maintained by the Indenture Trustee in accordance
with Section 2.04 of this Indenture.
(c) On each Payment Date, if the Servicer has reported to the Indenture
Trustee in the Servicer's Certificate for any Collection Period that an Obligor
or an Obligor's representative or successor successfully shall have asserted a
claim or defense under bankruptcy law or similar laws for the protection of
creditors generally (including the avoidance of a preferential transfer under
bankruptcy law) that results in a liability to such Obligor for monies
previously collected and remitted to the Indenture Trustee and not otherwise
netted against collections pursuant to Section 9.02, the Indenture Trustee shall
make all payments in respect of such claims or defenses out of the amounts on
deposit in the Collection Account with respect to such Collection Period before
making the distributions required by paragraph (a) of this Section 9.04.
(d) If the Servicer has failed to provide the Indenture Trustee with the
notice required pursuant to Section 9.02, the Indenture Trustee may calculate
Monthly Interest and Monthly Principal and apply funds, if any, in the
Collection Account as of the last day of the Collection Period, to make a
distribution of Monthly Interest and Monthly Principal to the Noteholders.
SECTION 9.05. Servicer Advances . The Servicer is required to make certain
Advances pursuant to Section 9.05 of the Trust Agreement. If the Servicer shall
determine that an Outstanding Advance with respect to any Receivable shall not
be recoverable, the Servicer shall be entitled to reimbursement from any
collections made on other Receivables pursuant to Section 9.04(a)(i), and
Outstanding Advances with respect to such Receivable shall be reduced
accordingly.
SECTION 9.06. Net Deposits. For so long as UAC is the Servicer, UAC (in
whatever capacity) may make the remittances with respect to any Payment Date
pursuant to Section 9.02 above, net of amounts to be distributed to itself or
its delegee under Section 13.06 of the Trust Agreement (also in whatever
capacity) pursuant to Section 9.04, if it determines pursuant to Section 9.02
that there is no deficiency in Available Funds for such Payment Date.
Nonetheless, the Servicer shall account for all of the above described amounts
as if such amounts were deposited and distributed.
SECTION 9.07. Intentionally Blank.
SECTION 9.08. Intentionally Blank.
SECTION 9.09. Payahead Account. The Servicer shall establish the Payahead
Account with the Indenture Trustee or another Eligible Bank in the name of the
Indenture Trustee on behalf of the Obligors and the Noteholders as their
interests may appear pursuant to Section 9.09 of the Trust Agreement. Investment
income or interest earned on the Payahead Account shall be remitted to the
Servicer at least monthly, or as frequently as the Servicer may reasonably
request. On or prior to each Payment Date, the Servicer shall transfer or the
Indenture Trustee (as instructed in the Servicer's Certificate) shall transfer
(a) from the Collection Account to the Payahead Account, in immediately
available funds, all Payaheads received by the Servicer and previously deposited
to the Collection Account during the Collection Period as described in Section
8.02(b) of the Trust Agreement; and (b) from the Payahead Account to the
Collection Account, in immediately available funds, the aggregate amount of
previously deposited Payaheads to be applied to the related Scheduled Payments
on Precomputed Receivables for the related Collection Period or prepayments for
the related Collection Period, pursuant to Section 8.02(b) of the Trust
Agreement, each in the amounts set forth in the Servicer's Certificate delivered
on the related Determination Date. A single, net transfer between the Payahead
Account and the Collection Account may be made. Any amount deposited in any
Payahead Account shall not constitute Available Funds under Section 9.02. Any
amount deposited to the Collection Account from a Payahead Account pursuant to
Section 9.09(b) shall be included in Available Funds under Section 9.02.
SECTION 9.10. Pre-Funding Account. (a) On or before the Closing Date, the
Indenture Trustee shall establish and maintain a segregated trust account in the
corporate trust department of an Eligible Bank referred to herein as the
"Pre-Funding Account". Funds on deposit in the Pre-Funding Account shall be
invested in Eligible Investments in the same manner and subject to the same
limitation as the investment of funds in the Collection Account pursuant to
Section 9.01, including the limitation that Eligible Investments mature not
later than the Business Day prior to the next succeeding Payment Date; provided,
however, that if the Seller shall have given notice to the Indenture Trustee
designating the next Subsequent Transfer Date such Eligible Investments shall
not be required to mature until the Business Day prior to such Subsequent
Transfer Date.
(b) On the Closing Date, the Seller will deposit the Initial Pre-Funded
Amount in the Pre-Funding Account. On each Subsequent Transfer Date, the
Servicer shall instruct the Indenture Trustee to withdraw from the Pre-Funding
Account an amount equal to the Principal Balance of the Subsequent Receivables
transferred to the Trust on such Subsequent Transfer Date and to distribute such
amount to or upon the order of the Seller upon satisfaction of the conditions
set forth in the Trust Agreement with respect to such transfer.
(c)(i) If the Pre-Funded Amount is greater than $100,000 on the Payment
Date on which the Funding Period ends (or, if the Funding Period does not end on
a Payment Date, on the first Payment following the end of the Funding Period),
after giving effect to any reductions in the Pre-Funding Amount on such Payment
Date pursuant to paragraph (b) above, the Servicer shall instruct the Indenture
Trustee to withdraw any remaining amounts from the Pre-Funding Account and to
distribute such amounts pro rata to the Noteholders of each Class of Notes then
outstanding.
(ii) If the Pre-Funded Amount is reduced to $100,000 or less on any Payment
Date, after giving effect to any reductions in the Pre-Funded Amount on such
Payment Date pursuant to paragraph (b) above, the Servicer shall instruct the
Indenture Trustee to withdraw any remaining amounts from the Pre-Funding Account
and to deposit such amounts to the Collection Account for distribution as
principal of the Receivables to the Class of Notes entitled to receive principal
distributions on such Payment Date.
SECTION 9.11. Release of Pledged Assets.
(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 and
to the Insurer pursuant to the Insurance Agreement have been paid, release any
remaining portion of the Pledged Assets 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 Collection Account, Spread Account and Payahead
Account. The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 9.11(b) only upon receipt of an Issuer
Request accompanied by an Officer's Certificate, an Opinion of Counsel and (if
required by the TIA) Independent Certificates in accordance with TIA Sections
314(c) and 314(d)(1) meeting the applicable requirements of Section 13.01.
SECTION 9.12. Opinion of Counsel. The Indenture Trustee shall receive at
least seven days' notice when requested by the Issuer to take any action
pursuant to Section 9.10(a), accompanied by copies of any instruments involved,
and the Indenture Trustee shall also require, as a condition to such action, an
Opinion of Counsel, in form and substance satisfactory to the Indenture Trustee
(and not at the expense of the Indenture Trustee), stating the legal effect of
any such action, outlining the steps required to complete the same, and
concluding that all conditions precedent to the taking of such action have been
complied with and such action will not materially and adversely impair the
security for the Notes or the rights of the Noteholders in contravention of the
provisions of this Indenture; provided, however, that such Opinion of Counsel
shall not be required to express an opinion as to the fair value of the Pledged
Assets. 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.
ARTICLE X
CREDIT ENHANCEMENT
SECTION 10.01. Subordination. The payment of Monthly Principal to Class B
Noteholders shall be subordinated to the payment of Class A Monthly Interest and
Class A Monthly Principal on any Payment Date, and the payment of Class B
Monthly Interest shall be subordinated to the payment of Class A Monthly
Interest and Class A Monthly Principal (i) to the extent of principal owed on a
Final Maturity Date of a Class of Class A Notes or (ii) after the Notes shall
have been declared to be due and payable under Section 5.02 following an Event
of Default.
SECTION 10.02. Spread Account.
(a) On or prior to the Closing Date, the Indenture Trustee shall establish
and maintain a segregated trust account with the Indenture Trustee or in the
corporate trust department of another Eligible Bank referred to herein as the
"Spread Account." The Spread Account shall be maintained in the name of the
Indenture Trustee. The Spread Account and any amounts on deposit therein shall
be part of the Pledged Assets and shall be for the benefit of the Secured
Parties, as their respective interests may appear herein; provided, however,
that the interest of the Insurer therein shall be subordinated to the interests
of the Noteholders as provided herein. On the Closing Date, UAC Securitization
Corporation shall deposit the Initial Spread Account Amount and the Pre-Funding
Reserve Deposit Amount in the Spread Account.
(b) Funds on deposit in the Spread Account shall be invested in Eligible
Investments in the same manner and subject to the same requirements and
limitations as the investment of funds in the Collection Account pursuant to
Section 9.01, including the limitation that Eligible Investments mature not
later than the Business Day prior to the next succeeding Payment Date; provided,
however, that no such limitation on the maturity of Eligible Investments shall
apply if the Indenture Trustee obtains the benefit of a liquidity facility or
similar arrangement from a commercial bank with an Approved Rating or other
provider approved in advance in writing by the Insurer and the Administrative
Agent, with respect to funds in the Spread Account (a "Spread Account Facility")
and Standard & Poor's and ▇▇▇▇▇'▇ confirm in writing that the rating of the
Notes will not be lowered or withdrawn as a result of eliminating or modifying
the limitation on the maturity of Eligible Investments in respect of the Spread
Account. For purposes of determining the availability of funds or the balance in
the Spread Account for any reason under this Indenture, investment earnings on
such funds shall be deemed to be available or on deposit only to the extent that
the aggregate of such amounts, plus the funds on deposit in such Spread Account,
do not exceed the Required Spread Amount.
(c) (i) If on any Payment Date (other than a Payment Date after an Event
of Default shall have occurred and be continuing) the amount of Available Funds
is insufficient to make the distributions required by Sections 9.04(a)(i)
through (vii), the Indenture Trustee shall withdraw or cause to be withdrawn
from the Spread Account and deposited in the Collection Account the lesser of
(x) the entire Available Spread Amount and (y) the amount necessary to make up
such deficiency to pay any deficiency, as provided in Sections 9.02 and 9.04 and
the Policy.
(ii) Alternatively, if on any Payment Date after an Event of Default
the amount of Available Funds is insufficient to make the distributions required
by Sections 5.06(a)(i) through (vii), but excluding any distributions required
by Section 5.06(a)(ii), the Indenture Trustee shall withdraw or cause to be
withdrawn from the Spread Account and deposited in the Collection Account the
lesser of (x) the entire Available Spread Amount and (y) the amount necessary to
make up such deficiency, as provided in Sections 5.06 and 9.02 and the Policy.
(d) On each Payment Date, all distributions made pursuant to Sections
9.04(a)(x) or 5.06(a)(ix), as applicable, shall be deposited into the Spread
Account.
(e) If the amount on deposit in the Spread Account, after giving effect to
the distributions set forth in Section 9.04 (including, without limitation,
payment of amounts due and owing to the Insurer) is greater than the Required
Spread Amount on such Payment Date, such excess shall first be applied to pay
any current and past due Insurance Premiums or any amounts owing to the Insurer
pursuant to the Insurance Agreement including, without limitation,
reimbursement, indemnities, fees and expenses, Insurer Defense Costs, plus
accrued interest thereon, and after payment of such amounts to the Insurer, any
amounts remaining on deposit in the Spread Account shall be distributed by the
Indenture Trustee to the Owner Trustee, or as the Owner Trustee shall direct in
writing in accordance with the Trust Agreement to the Certificateholder. Amounts
properly distributed to the Owner Trustee or Certificateholder pursuant to this
Section, either directly without deposit in the Spread Account or from excess
amounts in the Spread Account shall be deemed released from the security
interest of the Indenture Trustee on behalf of the Secured Parties.
(f) The Servicer is permitted to purchase the Receivables from the Issuer
when the Note Balances have been reduced to 10% or less of the Initial Note
Balances pursuant to Section 16.02 of the Trust Agreement. Upon discharge and
satisfaction of this Indenture pursuant to Section 4.01, amounts remaining in
the Spread Account, after payment of any amounts due and owing to the
Noteholders and to the Insurer, shall be distributed by the Indenture Trustee to
the Owner Trustee, or as the Owner Trustee shall direct in accordance with the
Trust Agreement to the Certificateholder, and such amounts shall not be subject
to any claims or rights of any Noteholder.
SECTION 10.03. Policy.
(a) The Insurer is required under the terms of the Policy to pay the
Monthly Servicing Fee, Monthly Interest and Monthly Principal up to the Policy
Amount in the event of any deficiency of Available Funds to pay such amounts
(after permitted reimbursements of related Outstanding Advances) not covered by
amounts withdrawn from the Spread Account, as determined pursuant to Section
9.02, to the Indenture Trustee for credit to the Collection Account on the later
of (a) 12:00 noon, New York City time, on the Payment Date and (b) 12:00 noon,
New York City time, on the Business Day immediately succeeding presentation to
the Fiscal Agent of the Indenture Trustee's demand therefor. Any demand for
payment pursuant to Section 9.02 to the Fiscal Agent received by the Fiscal
Agent on a Business Day after 1:00 p.m., New York City time, or on any day that
is not a Business Day, will be deemed to be received by the Fiscal Agent at 9:00
a.m., New York City time, on the next Business Day. Notwithstanding the
foregoing, on a Redemption Date, the obligations of the Insurer under the Policy
shall be limited in accordance with Section 9.04(b)(ii). The Indenture Trustee
hereby agrees on behalf of the Noteholders (and each Noteholder, by its
acceptance of its Notes, hereby agrees) for the benefit of the Insurer that the
Indenture Trustee shall recognize that to the extent the Insurer makes a payment
under the Policy, either directly or indirectly (as by paying through the
Indenture Trustee), to the Noteholders, the Insurer will be entitled to be
subrogated to the rights of the Noteholders to the extent of such payments under
the Policy. Any rights of subrogation acquired by the Insurer as a result of any
payment made under the Policy shall, in all respects, be subordinate and junior
in right of payment to the prior indefeasible payment in full of all amounts due
the Indenture Trustee on account of payments due under the Notes pursuant to
Section 9.04 hereof.
(b) The Insurer shall pay any Preference Amounts, but only after there
shall have been delivered to the Insurer (x) a certified copy of a final order
of the court exercising jurisdiction in the Insolvency Proceeding to the effect
that the Indenture Trustee is required to return any such payment or portion
thereof prior to the Termination Date (as defined in the Policy) of the Policy
because such payment was voided under applicable law, with respect to which
order the appeal period has expired without an appeal having been filed (the
"Final Order"), (y) an assignment, in the form of Exhibit D to the Policy,
irrevocably assigning to the Insurer all rights and claims of such Indenture
Trustee relating to or arising under such Avoided Payment and (z) a Notice for
Payment in the form of Exhibit A to the Policy appropriately completed and
executed by the Indenture Trustee. Such payment shall be disbursed to the
receiver, conservator, debtor-in-possession or trustee in bankruptcy named in
the Final Order and not to the Indenture Trustee directly.
The Indenture Trustee, for itself and on behalf of the Noteholders, agrees
that the Insurer may at any time during the continuation of any proceeding
relating to a Final Order direct all matters relating to such Final Order,
including, without limitation, the direction of any appeal of any order relating
to such Final Order and the posting of any surety, supersedeas or performance
bond pending any such appeal. In addition and without limitation of the
foregoing, the Insurer shall be subrogated, to the extent of amounts paid under
the Policy, to the rights of UAC, the Servicer, the Seller, the Issuer, the
Indenture Trustee and the Noteholders in the conduct of any preference claim,
including, without limitation, all rights of any party to any adversarial
proceeding or action with respect to any court order issued in connection with
any such preference claim.
ARTICLE XI
SUPPLEMENTAL INDENTURES
SECTION 11.01. Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of the Holders of any Notes but with the consent of
the Insurer, so long as no Insurer Default shall have occurred and be
continuing, 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
Noteholders, or to surrender any right or power herein conferred upon the
Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any property to
or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any provision
herein or in any supplemental indenture 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
Noteholders;
(vi) to evidence and provide for the acceptance of the appointment
hereunder by a successor trustee with respect to the Notes and to add to or
change any of the provisions of this Indenture as shall be necessary to
facilitate the administration of the trusts hereunder by more than one
trustee, pursuant to the requirements of Article Six; or
(vii) to modify, eliminate or add to the provisions of this Indenture
to such extent as shall be necessary to effect the qualification of this
Indenture under the TIA or under any similar federal statute hereafter
enacted and to add to this Indenture such other provisions as may he
expressly required by the TIA.
The Indenture Trustee shall 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 (i) without the consent of any of the Noteholders, but (ii)
with the consent of the Insurer, so long as an Insurer Default shall not have
occurred, and (iii) 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 Noteholders
under this Indenture; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel, adversely affect in any material respect the
interests of any Noteholder.
SECTION 11.02. Supplemental Indentures With Consent of Noteholders.
(a) The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, also may (i) with prior notice to each Rating Agency, (ii) with the
consent of the Insurer, so long as no Insurer Default shall have occurred and be
continuing (iii) with the consent of the Holders of not less than a majority of
the Outstanding Note Balances, by Act of such Holders delivered to the Issuer
and the Indenture Trustee, 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 Noteholders under this Indenture; provided, however,
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:
(i) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof, the interest
rate thereon 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;
(ii) impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of funds available
therefor, as provided in Article Five, 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);
(iii) reduce the percentage of the Note Balances of the Notes, the
consent of the Holders of which is required for any such supplemental
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;
(iv) modify or alter the provisions of the second proviso to the
definition of the term "Outstanding";
(v) reduce the percentage of the Note Balances of the Notes, the
consent of the Holders of which is required to direct the Indenture Trustee
to sell or liquidate the Pledged Assets pursuant to Section 5.04;
(vi) decrease the percentage of the Note Balances of the Notes
required to amend this Indenture or the other Basic Documents; or
(vii) 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
Pledged Assets 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.
(b) 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.
(c) 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.
(d) Promptly after the execution by the parties hereto of any supplemental
indenture pursuant to this Section, the Indenture Trustee shall mail to the
Noteholders to which such amendment or supplemental indenture relates a notice
setting forth in general terms the substance of such supplemental indenture. Any
failure of the Indenture Trustee to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
supplemental indenture.
SECTION 11.03. 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 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 indenture that affects the
Indenture Trustee's own rights, duties, liabilities or immunities under this
Indenture or otherwise.
SECTION 11.04. 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 Noteholders shall thereafter be determined, exercised
and enforced hereunder subject in all respects to such modifications and
amendments, and all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of this Indenture
for any and all purposes.
SECTION 11.05. 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 11.06. Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
ARTICLE XII
REDEMPTION OF NOTES
SECTION 12.01. Redemption. In the event that the Servicer exercises its
right to require disposition of the corpus of the Trust pursuant to Section
16.02 of the Trust Agreement, the Notes are subject to redemption in whole, but
not in part, on the Payment Date on which such repurchase occurs, for a purchase
price equal to the Redemption Price; provided, however, that the Issuer has
available funds sufficient to pay the Redemption Price. The Servicer or the
Issuer shall furnish the Insurer (so long as an Insurer Default shall not have
occurred and be continuing and the Policy shall be in effect), and each Rating
Agency notice of such redemption. If the Notes are to be redeemed pursuant to
this Section 12.01, the Servicer or the Issuer shall furnish notice of such
election to the Indenture Trustee not later than ten (10) days prior to the
Redemption Date and the Issuer shall deposit with the Indenture Trustee in the
Collection Account the Redemption Price of the Notes to be redeemed whereupon
all such Notes shall be due and payable on the Redemption Date upon the
furnishing of a notice complying with Section 12.02 to each Holder of the Notes.
SECTION 12.02. Form of Redemption Notice. Notice of redemption under
Section 12.01 shall be given by the Indenture Trustee by first-class mail,
postage prepaid, mailed 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,
pursuant to Section 2.07(b) of this Indenture.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) CUSIP numbers; and
(iv) 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 Indenture Trustee
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 12.03. Notes Payable on Redemption Date. The Notes or portions
thereof to be redeemed shall, following notice of redemption (if any) as
required by Section 12.02, on the Redemption Date become due and payable at the
Redemption Price and (unless the Issuer shall default in the payment of the
Redemption Price) no interest shall accrue on the Redemption Price for any
period after the date to which accrued interest is calculated for purposes of
calculating the Redemption Price.
ARTICLE XIII
MISCELLANEOUS
SECTION 13.01. Compliance Certificates and Opinions, etc.
(a) Upon any application or request by the Issuer to the Indenture Trustee
to take any action under any provision of this Indenture, the Issuer shall
furnish to the Indenture Trustee (i) an Officer's Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with, (ii) an Opinion of Counsel stating that
in the opinion of such counsel all such conditions precedent, if any, have been
complied with and (iii) (if required by the TIA) an Independent Certificate from
a firm of certified public accountants meeting the applicable requirements of
this Section and TIA Sections 314(c) and 314(d)(1). 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 Pledged Assets 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 shall, in addition to any obligation imposed in Section 13.01(a) or
elsewhere in this Indenture, 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 Pledged Assets 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 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 Note Balances, 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
of the Note Balances.
(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 Note Balances 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 Note Balances of the
Notes.
SECTION 13.02. Form of Documents Delivered to Indenture Trustee.
(a) In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
(b) Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the 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 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.
(c) Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
(d) Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article Six.
SECTION 13.03. 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 and the
record date applicable to any solicitation for an Act of the Noteholders shall
comply with Section 3.16(c) of the TIA.
(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.
SECTION 13.04. 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 or by the Issuer, it 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 or by any Noteholder, it
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: UACSC 2001-C, in care of
First Union Trust Company, National Association, as Owner Trustee, One
▇▇▇▇▇▇ Square, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Administration, facsimile (▇▇▇) ▇▇▇-▇▇▇▇ 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, it 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: MBIA Insurance Corporation, ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Insured Portfolio Management,
Structured Finance, facsimile (▇▇▇) ▇▇▇-▇▇▇▇.
(b) Any notices delivered to the Issuer hereunder shall also be delivered
(by the same means) to the Servicer and the Administrator c/o Union Acceptance
Corporation, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇, facsimile (▇▇▇) ▇▇▇-▇▇▇▇.
(c) Any 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, Inc., ABS Monitoring Department, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and (ii) in the case of Standard & Poor's, at the following
address: Standard & Poor's Ratings Services, a division of the ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ (▇▇▇▇ ▇▇▇▇▇), ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: Structured Finance/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 13.05. Notices to Noteholders; Waiver.
(a) 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.
(b) 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.
(c) 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.
(d) 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 13.06. 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 13.07. Conflict With Trust Indenture Act.
(a) 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.
(b) 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 13.08. 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 13.09. 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 13.10. Separability. In case any provision in this Indenture or in
the Notes shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 13.11. Benefits of Indenture. The Insurer and its successors and
assigns shall be third-party beneficiaries to the provisions of this Indenture,
and shall be entitled to rely upon and directly enforce such provisions of this
Indenture so long as no Insurer Default shall have occurred and be continuing
and the Policy shall be in effect. The Owner Trustee shall be a third-party
beneficiary to the provisions of this Indenture with respect to fees, expenses
and indemnity upon and following the occurrence of an Event of Default. Nothing
in this Indenture or in the Notes, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder, and the
Noteholders, and any other party secured hereunder, and any other Person with an
ownership interest in any part of the Pledged Assets, 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 Policy, upon delivery of a written notice to the
Indenture Trustee.
SECTION 13.12. Legal Holidays. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
SECTION 13.13. Governing Law. This Indenture shall be construed in
accordance with the laws of the State of New York, without regard to the
conflict of laws principles thereof, and the obligations, rights, and remedies
of the parties under this Indenture shall be determined in accordance with such
laws.
SECTION 13.14. 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 13.15. 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 13.16. 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, or of any holder of a
beneficial interest in the Issuer, 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
capacities) and except that any such partner, owner or beneficiary shall be
fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity. For all purposes of this Indenture, in
the performance of any duties or obligations of the Issuer hereunder, the Owner
Trustee shall be subject to, and entitled to the benefits of, the terms and
provisions of Articles Six, Seven and Eight of the Trust Agreement.
SECTION 13.17. 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 in connection with any obligations relating to
the Notes, this Indenture or any of the other Basic Documents.
SECTION 13.18. 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 or the Insurer may reasonably determine that such disclosure
is consistent with its obligations hereunder.
SECTION 13.19. Limitation of Liability of Owner Trustee. Notwithstanding
anything contained herein to the contrary, this instrument has been
countersigned by the Owner Trustee not in its individual capacity but solely in
its capacity as Owner Trustee of the Issuer and in no event shall the Owner
Trustee 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 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 Seven, Eight, Ten, Twelve, Thirteen, Fourteen and Fifteen
of the Trust Agreement.
SECTION 13.20. 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 or
Certificateholders are entitled to exercise pursuant to this Indenture, without
any consent of such Noteholders or Certificateholders; provided, however, that
without the consent of each Noteholder and Certificateholder affected thereby,
the Insurer shall not exercise such rights to amend this Indenture in any manner
that would (i) reduce the amount of, or delay the timing of, collections of
payments on the Receivables or distributions which are required to be made on
any Note or Certificate, (ii) adversely affect in any material respect the
interests of the Holders of any Notes or Certificates, or (iii) alter the rights
of any such Holder to consent to such amendment.
Notwithstanding any provision in this Indenture to the contrary, in the
event an Insurer Default shall have occurred and be continuing, the Insurer
shall not have the right to take any action under this Indenture 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 or the Certificateholders; provided, that the consent
of the Insurer shall be required at all times with respect to any amendment of
this Indenture.
SECTION 13.21. Acknowledgement of Parties; Insurer Defense Costs. Each of
the Issuer and the Indenture Trustee acknowledges Section 15.14 of the Trust
Agreement, and agrees that the Trust shall reimburse the Insurer for all Insurer
Defense Costs pursuant to Section 9.04 or 5.06 hereof, as applicable.
[next page is signature page]
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.
UACSC 2001-C OWNER TRUST
By FIRST UNION TRUST COMPANY, NATIONAL
ASSOCIATION, not in its individual capacity but
solely on behalf of the Issuer as Owner Trustee under
the Trust Agreement
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Title: Vice President
BNY MIDWEST TRUST COMPANY,
not in its individual capacity but solely as
Indenture Trustee
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Vice President
[SCHEDULES AND EXHIBITS OMITTED]