EXECUTION VERSION
GE Equipment Midticket LLC, Series 2007-1
Issuer
and
The Bank of New York,
as Indenture Trustee.
----------
INDENTURE
Dated as of November 20, 2007
----------
$1,137,359,000 in aggregate principal amount of Notes, consisting of:
$243,000,000 of 4.90565% Class A-1 Notes
$75,000,000 of 4.58% Class A-2a Notes
$208,000,000 of One-Month LIBOR + 0.20% Class A-2b Notes
$53,000,000 of 4.53% Class A-3a Notes
$200,000,000 of One-Month LIBOR + 0.25% Class A-3b Notes
$311,727,000 of One-Month LIBOR + 0.30% Class A-4 Notes
$26,728,000 of 5.88% Class B Notes
$19,904,000 of 6.85% Class C Notes
GE Equipment Midticket LLC, Series 2007-1
Reconciliation and Tie between this Indenture
dated as of November 20, 2007 and the
TIA of 1939, as amended
TIA Section Indenture Section
----------- -----------------
310(a)(1) 6.11
(a)(2) 6.11
(a)(3) 6.10(b)
(a)(4) Not Applicable
(b) 6.11
(c) Not Applicable
311(a) 6.13
(b) 6.13
312(a) 7.1
(b) 7.2(b)
(c) 7.2(c)
313(a) 6.14
(b)(1) 6.14
(b)(2) 6.14
(c) 6.14; 7.3(a)(ii)
(d) 6.14
314(a) 7.3
(b) 3.6; 8.8
(c)(1) 8.7
(c)(2) 8.7
(c)(3) 8.7
(d) 8.7
(e) 11.1
(f) Not Applicable
315(a) 6.1
(b) 6.5
(c) 6.1
(d) 6.7
(e) 5.10
316(a) (last sentence) 2.12
(a)(1)(A) 5.8
(a)(1)(B) 5.9
(a)(2) Not Applicable
317(a)(1) 5.2
(a)(2) 5.2
(b) 6.16
318(a) 11.19
(c) 11.19
TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE.................................................. 3
SECTION 1.1. Definitions......................................................................... 3
SECTION 1.2. Other Interpretive Matters.......................................................... 19
SECTION 1.3. Incorporation by Reference of TIA................................................... 20
ARTICLE II THE NOTES.................................................................................. 20
SECTION 2.1. Form................................................................................ 20
SECTION 2.2. Execution, Authentication and Delivery.............................................. 21
SECTION 2.3. Temporary Notes..................................................................... 21
SECTION 2.4. Registration; Registration of Transfer and Exchange................................. 22
SECTION 2.5. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, Lost or Stolen Notes.......................................... 23
SECTION 2.6. Persons Deemed Owner................................................................ 24
SECTION 2.7. Payment of Principal and Interest; Defaulted Interest............................... 24
SECTION 2.8. Cancellation........................................................................ 26
SECTION 2.9. Book-Entry Notes.................................................................... 26
SECTION 2.10. Notices to Clearing Agency.......................................................... 27
SECTION 2.11. Definitive Notes.................................................................... 27
SECTION 2.12. Notes owned by the Issuer or its Affiliates......................................... 27
SECTION 2.13. CUSIP Numbers....................................................................... 28
SECTION 2.14. Perfection Representations and Warranties........................................... 28
SECTION 2.15. Notes to Constitute Indebtedness.................................................... 28
SECTION 2.16. Determination of LIBOR.............................................................. 28
ARTICLE III COVENANTS................................................................................. 29
SECTION 3.1. Payments............................................................................ 29
SECTION 3.2. Maintenance of Office or Agency..................................................... 29
SECTION 3.3. Paying Agent's Obligations.......................................................... 29
SECTION 3.4. Existence........................................................................... 29
SECTION 3.5. Protection of the Collateral; Further Assurances.................................... 30
SECTION 3.6. Opinions as to the Collateral....................................................... 30
SECTION 3.7. Performance of Obligations; Servicing of Loans...................................... 31
SECTION 3.8. Taxes............................................................................... 32
SECTION 3.9. Annual Statement as to Compliance................................................... 32
SECTION 3.10. Information to Be Provided by the Indenture Trustee................................. 33
SECTION 3.11. Negative Covenants.................................................................. 34
SECTION 3.12. Successor or Transferee............................................................. 36
SECTION 3.13. Notice of Events of Default......................................................... 37
SECTION 3.14. Further Instruments and Acts........................................................ 37
ARTICLE IV SATISFACTION AND DISCHARGE................................................................. 37
SECTION 4.1. Satisfaction and Discharge of Indenture............................................. 37
SECTION 4.2. Application of Trust Funds.......................................................... 38
ARTICLE V REMEDIES.................................................................................... 38
SECTION 5.1. Events of Default................................................................... 38
SECTION 5.2. Remedies............................................................................ 39
SECTION 5.3. [Reserved].......................................................................... 42
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TABLE OF CONTENTS
(continued)
PAGE
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SECTION 5.4. Unconditional Rights of Noteholders To Receive Principal and Interest............... 42
SECTION 5.5. Restoration of Rights and Remedies.................................................. 42
SECTION 5.6. Rights and Remedies Cumulative...................................................... 42
SECTION 5.7. Delay or Omission Not a Waiver...................................................... 42
SECTION 5.8. Control by Noteholders.............................................................. 43
SECTION 5.9. Waiver of Past Defaults............................................................. 44
SECTION 5.10. Undertaking for Costs............................................................... 44
SECTION 5.11. Waiver of Stay or Extension Laws.................................................... 44
SECTION 5.12. Action on Notes..................................................................... 45
SECTION 5.13. [Reserved].......................................................................... 45
SECTION 5.14. Sale of Collateral.................................................................. 45
ARTICLE VI THE INDENTURE TRUSTEE...................................................................... 47
SECTION 6.1. Duties of the Indenture Trustee..................................................... 47
SECTION 6.2. Rights of Indenture Trustee......................................................... 48
SECTION 6.3. Individual Rights of the Indenture Trustee.......................................... 50
SECTION 6.4. Funds Held in Trust................................................................. 50
SECTION 6.5. Notice of Defaults.................................................................. 50
SECTION 6.6. [Reserved].......................................................................... 50
SECTION 6.7. Compensation and Indemnity.......................................................... 50
SECTION 6.8. Resignation and Removal; Appointment of Successor................................... 51
SECTION 6.9. Successor Indenture Trustee by Merger............................................... 52
SECTION 6.10. Appointment of Co-Trustee or Separate Trustee....................................... 53
SECTION 6.11. Eligibility; Disqualification....................................................... 54
SECTION 6.12. Acceptance by Indenture Trustee..................................................... 55
SECTION 6.13. Preferential Collection of Claims Against the Issuer................................ 55
SECTION 6.14. Reports by Indenture Trustee to Noteholders......................................... 55
SECTION 6.15. Representations and Warranties...................................................... 56
SECTION 6.16. The Paying Agent.................................................................... 56
SECTION 6.17. Repayment of Amounts Held by Paying Agent........................................... 58
SECTION 6.18. Provisions of Swap Agreement........................................................ 58
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS............................................................ 59
SECTION 7.1. Issuer To Furnish Indenture Trustee Names and Addresses of Noteholders.............. 59
SECTION 7.2. Preservation of Information; Communications to Noteholders.......................... 59
SECTION 7.3. Reports by Issuer................................................................... 59
SECTION 7.4. De-Listing of Definitive Notes...................................................... 60
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES..................................................... 60
SECTION 8.1. Collection of Amounts Due........................................................... 60
SECTION 8.2. Trust Accounts...................................................................... 60
SECTION 8.3. Priority of Payments................................................................ 61
SECTION 8.4. Reserve Account..................................................................... 65
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TABLE OF CONTENTS
(continued)
PAGE
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SECTION 8.5. Reports............................................................................. 66
SECTION 8.6. General Provisions Regarding Accounts............................................... 67
SECTION 8.7. Release of Collateral............................................................... 68
SECTION 8.8. Opinion of Counsel.................................................................. 68
ARTICLE IX SUPPLEMENTAL INDENTURES.................................................................... 68
SECTION 9.1. Supplemental Indentures Without Consent of Noteholders and Swap Counterparty........ 68
SECTION 9.2. Supplemental Indentures With Consent of Noteholders................................. 69
SECTION 9.3. Execution of Supplemental Indentures................................................ 71
SECTION 9.4. Effect of Supplemental Indenture.................................................... 71
SECTION 9.5. Reference in Notes to Supplemental Indentures....................................... 71
SECTION 9.6. Conformity with Trust Indenture Act................................................. 71
ARTICLE X REDEMPTION OF NOTES......................................................................... 71
SECTION 10.1. Redemption.......................................................................... 71
SECTION 10.2. Form of Redemption Notice........................................................... 72
SECTION 10.3. Notes Payable on Redemption Date.................................................... 72
ARTICLE XI MISCELLANEOUS.............................................................................. 72
SECTION 11.1. Compliance Certificates and Opinions, etc........................................... 72
SECTION 11.2. Form of Documents Delivered to Indenture Trustee.................................... 74
SECTION 11.3. Acts of Noteholders................................................................. 75
SECTION 11.4. Notices, etc., to the Indenture Trustee, Issuer and Rating Agencies................. 76
SECTION 11.5. Notices to Noteholders; ▇▇▇▇▇▇...................................................... 77
SECTION 11.6. Alternate Payment and Notice Provisions............................................. 77
SECTION 11.7. Successors and Assigns.............................................................. 77
SECTION 11.8. Severability........................................................................ 77
SECTION 11.9. Benefits of Indenture............................................................... 78
SECTION 11.10. Legal Holidays...................................................................... 78
SECTION 11.11. Governing Law....................................................................... 78
SECTION 11.12. Counterparts........................................................................ 79
SECTION 11.13. Recording of Indenture.............................................................. 79
SECTION 11.14. Trust Obligation.................................................................... 79
SECTION 11.15. Communication by Noteholders with Other Noteholders................................. 80
SECTION 11.16. Inspection.......................................................................... 80
SECTION 11.17. Agents of Issuer.................................................................... 80
SECTION 11.18. Survival of Representations and Warranties.......................................... 80
SECTION 11.19. Conflict with Trust Indenture Act................................................... 81
SECTION 11.20. Subordination....................................................................... 81
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EXHIBITS
EXHIBIT A-1 Form of Class A Notes
EXHIBIT A-2 Form of Class B Notes
EXHIBIT A-3 Form of Class C Notes
EXHIBIT B Form of Section 3.9 Officers' Certificate
EXHIBIT C Servicing Criteria to be Addressed in Assessment of Compliance
EXHIBIT D Form of Annual Certification of the Indenture Trustee
EXHIBIT E Form of Noteholder's Statement Pursuant to Section 8.5
SCHEDULE 1 Perfection Representations, Warranties and Covenants
-iv-
INDENTURE, dated as of November 20, 2007, between GE Equipment Midticket
LLC, Series 2007-1, a Delaware limited liability company (the "Issuer"), and The
Bank of New York, as trustee and not in its individual capacity (the "Indenture
Trustee").
The Issuer has duly authorized the issuance of $1,137,359,000 in aggregate
principal amount of its Notes, consisting of $243,000,000 aggregate principal
amount of 4.90565% Class A-1 Notes (the "Class A-1 Notes"), $75,000,000
aggregate principal amount of 4.58% Class A-2a Notes (the "Class A-2a Notes"),
$208,000,000 aggregate principal amount of One-Month LIBOR + 0.20% Class A-2b
Notes (the "Class A-2b Notes" and together with the Class A-2a Notes, the "Class
A-2 Notes"), $53,000,000 aggregate principal amount of 4.53% Class A-3a Notes
(the "Class A-3a Notes"), $200,000,000 aggregate principal amount of One-Month
LIBOR + 0.25% Class A-3b Notes (the "Class A-3b Notes" and together with the
Class A-3a Notes, the "Class A-3 Notes"), $311,727,000 aggregate principal
amount of One-Month LIBOR + 0.30% Class A-4 Notes (the "Class A-4 Notes" and,
together with the Class A-1 Notes, the Class A-2 Notes and the Class A-3 Notes,
the "Class A Notes"), $26,728,000 aggregate principal amount of 5.88% Class B
Notes (the "Class B Notes") and $19,904,000 aggregate principal amount of 6.85%
Class C Notes (the "Class C Notes", and together with the Class A Notes and the
Class B Notes, the "Notes"), and to provide therefor the Issuer has duly
authorized the execution and delivery of this Indenture. The Notes shall be
entitled to payments of interest and principal as set forth herein.
All things necessary to make the Notes, when executed by the Issuer and
authenticated and delivered hereunder, the valid obligations of the Issuer, and
to make this Indenture a valid agreement of the Issuer, in accordance with its
terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by
the holders thereof, it is mutually covenanted and agreed, for the benefit of
all Noteholders, as follows:
GRANTING CLAUSE
The Issuer, as security for the Issuer's obligations under the Notes and
this Indenture, hereby Grants to the Indenture Trustee at the Closing Date, for
the benefit of the Noteholders and the Swap Counterparty, a security interest in
all of the Issuer's right, title and interest in, to and under the following,
whether now existing or hereafter arising or acquired (collectively, the
"Collateral"):
(a) the Loans, including the Loan Files, and all obligations of the
Obligors thereunder, including the right to payment of any interest accrued
and to accrue from and after November 1, 2007 or finance charges and other
obligations of such Obligor with respect thereto due or to become due on or
after the Cutoff Date;
(b) the Related Security and Collections with respect thereto;
(c) all property now or hereafter in the possession or custody of, or
in transit to, the Issuer, the Servicer, any Sub-Servicer or the Sellers
relating to any of the foregoing;
(d) all Records with respect to any of the foregoing;
(e) the Sale Agreement;
(f) the Trust Accounts and all funds, Financial Assets, Investment
Property or other property on deposit from time to time in or credited to
the Trust Accounts, including all investments and proceeds thereof and all
income thereon;
(g) the Purchase and Sale Agreement;
(h) the Servicing Agreement;
(i) all rights, title and interest of the Issuer in and to the Swap
Agreement;
(j) all General Intangibles relating to or arising out of any of the
property described in the foregoing clauses (a) through (i);
(k) all present and future claims, demands, causes and choses in
action in respect of any or all of the property described in the foregoing
clauses (a) through (j) and all payments on or under in respect of any or
all of the foregoing, including all proceeds of the conversion, voluntary
or involuntary, into cash or other liquid property, all cash proceeds,
Accounts, Promissory Notes, drafts, acceptances, Chattel Paper, checks,
Deposit Accounts, insurance proceeds, condemnation awards, rights to
payment of any and every kind and other forms of obligations and
receivables, instruments and other property that at any time constitute all
or part of or are included in the proceeds of any and all of the foregoing;
(l) all proceeds of the foregoing clauses (a) through (k); and
(m) all other personal property of the Issuer, of whatever kind or
nature and wherever located.
Such Grant is made in trust to secure (w) the payment of principal of and
interest on, and any other amounts owing in respect of, the Class A Notes,
equally and ratably without prejudice, priority or distinction, (x) the payment
of principal of and interest on, and any other amounts owing in respect of, the
Class B Notes, equally and ratably without prejudice, priority or distinction,
(y) the payment of principal of and interest on, and any other amounts owing in
respect of, the Class C Notes, equally and ratably without prejudice, priority
or distinction, and (z) the obligations owed by the Issuer to the Swap
Counterparty under the Swap Agreement, in each case, in the priority and to the
extent set forth herein and to secure compliance with this Indenture.
The Indenture Trustee, on behalf of the Noteholders and the Swap
Counterparty, (1) acknowledges such Grant, and (2) accepts the trusts under this
Indenture in accordance with 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 and the Swap Counterparty may be adequately and
effectively protected.
2
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. Definitions. Except as otherwise specified or as the context
may otherwise require, the following terms have the meanings set forth below for
all purposes of this Indenture.
"Account" is defined in Section 9-102(a)(2) of the UCC.
"Act" is defined in Section 11.3 of this Indenture.
"Administration Agreement" means the Administration Agreement, dated as of
November 20, 2007 between the Administrator and the Issuer.
"Administration Fee" means the fee payable to the Administrator pursuant to
Section 3 of the Administration Agreement.
"Administrator" means General Electric Capital Corporation in its capacity
as administrator, a Delaware corporation, or any successor Administrator under
the Administration Agreement.
"Affiliate" means, with respect to any Person, (a) each Person that,
directly or indirectly, owns or controls, whether beneficially, or as a trustee,
guardian or other fiduciary, five percent (5%) or more of the stock having
ordinary voting power in the election of directors of such Person, (b) each
Person that controls, is controlled by, or is under common control with such
Person, or (c) each of such Person's officers, directors, joint venturers and
partners. For the purposes of this definition, "control" of a Person means the
possession, directly or indirectly, of the power to direct or cause the
direction of its management or policies, whether through the ownership of voting
securities, by contract or otherwise.
"Annual Percentage Rate" or "APR" of a Loan means, the interest rate or
annual rate of finance charges stated in, or if not explicitly stated, the
implicit finance charges used by the finance company to determine periodic
payments with respect to the related Loan.
"Authorized Officer" means, with respect to any corporation, trust or
limited liability company, as appropriate, the Chairman or Vice-Chairman of the
Board, the President, any Vice President, the Secretary, the Treasurer, any
Assistant Secretary, any Assistant Treasurer, the Managing Member, and each
other officer, employee or member of such corporation, trust or limited
liability company, as appropriate, specifically or similar governing body of
such limited liability company or trust to sign agreements, instruments or other
documents on behalf of such corporation authorized in resolutions of the board
of directors of such corporation or similar governing body of such limited
liability company or trust, as appropriate.
"Available Amounts" means
(i) All payments made by or on behalf of the Obligors (excluding
any late fees, prepayment charges, assumption fees, modifications and
other administrative fees or similar charges allowed by applicable law
with respect to
3
the Loans that constitute part of the servicing fees) received during
the related Collection Period;
(ii) any Recoveries received during the related Collection
Period;
(iii) all Swap Payments Incoming and all Swap Termination
Payments received pursuant to the Swap Agreement with respect to such
Payment Date;
(iv) any proceeds from insurance policies covering the Equipment
or related Obligor received during the related Collection Period;
(v) Liquidation Proceeds received with respect to the related
Collection Period;
(vi) the Purchase Amount of each Loan that became a Purchased
Loan during the related Collection Period (to the extent deposited
into the Collection Account);
(vii) Investment Earnings for such Payment Date;
(viii) Servicing Advances received during the related Collection
Period; and
(ix) payments made by a lessee pursuant to its obligation (if
any) to pay the Termination Value pursuant to the related Loan
received during the related Collection Period;
provided that Available Amounts shall not include all payments or proceeds
(including Liquidation Proceeds) of any Loans the Purchase Amount of which has
been included in the Available Amounts in a prior Collection Period; and
provided further, that with respect to the first Payment Date, Available Amounts
will exclude payments and proceeds of interest on the Loans from the Cut-off
Date through November 1, 2007.
"Available Reserve Account Amount" means, for any Payment Date, an amount
equal to the amount on deposit in the Reserve Account on such date (exclusive of
Investment Earnings on such date and after giving effect to any withdrawals
therefrom on the related Transfer Date but before giving effect to any deposit
to the Reserve Account to be made on such date).
"Bankruptcy Code" means the provisions of Title 11 of the United States
Code, Sections 101 et seq., as amended from time to time.
"Benefit Plan" is defined in Section 2.4(a) of this Indenture.
"Book-Entry Notes" means a beneficial interest in the Notes of a particular
Class, ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.9 of this Indenture.
4
"Business Day" means any day that is not a Saturday, a Sunday or a day on
which banks are required or permitted to be closed in the State of New York or
the State of Connecticut.
"CEF Limited Liability Company Agreement" means the Second Amended and
Restated Limited Liability Company Agreement of CEF Equipment Holding, L.L.C.,
dated as of September 25, 2003, as the same may be amended or supplemented from
time to time.
"Certificated Security" is defined in Section 8-102(a)(4) of the UCC.
"Chattel Paper" is defined in Section 9-102(a)(11) of the UCC.
"Class" means any class of Notes; it being understood that the Class A-1
Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes
collectively shall constitute one Class.
"Class A Noteholder" means any holder of record of a Class A Note.
"Class A Notes" means the Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes and the Class A-4 Notes.
"Class A-1 Interest Rate" means 4.90565% per annum, computed on the basis
of the actual number of days in the related Interest Accrual Period and a year
of 360 days.
"Class A-1 Maturity Date" means November 14, 2008 (or, if such day is not a
Business Day, the next succeeding Business Day thereafter).
"Class A-1 Noteholder" means any holder of record of a Class A-1 Note.
"Class A-1 Notes" means the $243,000,000 aggregate principal amount of
Notes, Class A-1, issued pursuant to this Indenture.
"Class A-2 Maturity Date" means May 14, 2010 (or, if such day is not a
Business Day, the next succeeding Business Day thereafter).
"Class A-2 Noteholder" means any holder of record of a Class A-2 Note.
"Class A-2 Notes" means the Class A-2a Notes and the Class A-2b Notes.
"Class A-2a Interest Rate" means 4.58% per annum, computed on the basis of
a 360-day year of twelve 30-day months.
"Class A-2a Noteholder" means any holder of record of a Class A-2a Note.
"Class A-2a Notes" means the $75,000,000 aggregate principal amount of
Notes, Class A-2a, issued pursuant to this Indenture.
"Class A-2b Interest Rate" means 0.20% per annum, computed on the basis of
the actual number of days in the related Interest Accrual Period and a year of
360 days.
5
"Class A-2b Noteholder" means any holder of record of a Class A-2b Note.
"Class A-2b Notes" means the $208,000,000 aggregate principal amount of
Notes, Class A-2b, issued pursuant to this Indenture.
"Class A-3 Maturity Date" means June 14, 2011 (or, if such day is not a
Business Day, the next succeeding Business Day thereafter).
"Class A-3 Noteholder" means any holder of record of a Class A-3 Note.
"Class A-3 Notes" means the Class A-3a Notes and the Class A-3b Notes.
"Class A-3a Interest Rate" means 4.53% per annum, computed on the basis of
a 360-day year of twelve 30-day months.
"Class A-3a Noteholder" means any holder of record of a Class A-3a Note.
"Class A-3a Notes" means the $53,000,000 aggregate principal amount of
Notes, Class A-3a, issued pursuant to this Indenture.
"Class A-3b Interest Rate" means 0.25% per annum, computed on the basis of
the actual number of days in the related Interest Accrual Period and a year of
360 days.
"Class A-3b Noteholder" means any holder of record of a Class A-3b Note.
"Class A-3b Notes" means the $200,000,000 aggregate principal amount of
Notes, Class A-3b, issued pursuant to this Indenture.
"Class A-4 Interest Rate" means One-Month LIBOR + 0.30% per annum, computed
on the basis of the actual number of days in the related Interest Accrual Period
and a year of 360 days.
"Class A-4 Maturity Date" means May 14, 2013 (or, if such day is not a
Business Day, the next succeeding Business Day thereafter).
"Class A-4 Noteholder" means any holder of record of a Class A-4 Note.
"Class A-4 Notes" means the $311,727,000 aggregate principal amount of
Notes, Class A-4, issued pursuant to this Indenture.
"Class B Interest Rate" means 5.88% per annum, computed on the basis of a
360-day year of twelve 30-day months.
"Class B Maturity Date" means October 15, 2018 (or, if such day is not a
Business Day, the next succeeding Business Day thereafter).
"Class B Noteholder" means any holder of record of a Class B Note.
6
"Class B Notes" means the $26,728,000 aggregate principal amount of Notes,
Class B, issued pursuant to the Indenture.
"Class C Interest Rate" means One-Month LIBOR + 6.85% per annum, computed
on the basis of a 360-day year of twelve 30-day months.
"Class C Maturity Date" means October 15, 2018 (or, if such day is not a
Business Day, the next succeeding Business Day thereafter).
"Class C Noteholder" means any holder of record of a Class C Note.
"Class C Notes" means the $19,904,000 aggregate principal amount of Notes,
Class C, issued pursuant to this Indenture.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Securities Exchange Act that has been designated
as the "Clearing Agency" for purposes of this Indenture.
"Clearing Agency Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
"Closing Date" means November 20, 2007.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and Treasury Regulations promulgated thereunder.
"Collateral" is defined in the Granting Clause of this Indenture.
"Collection Account" means the account designated as such, established and
owned by the Issuer and maintained in accordance with Section 8.2 of this
Indenture.
"Collection Period" means, with respect to any Payment Date, the calendar
month preceding the month in which the Payment Date occurs (or, if for the first
Payment Date, the period from and including the day after the Cutoff Date to and
including the last day of the calendar month preceding the calendar month in
which the first Payment Date occurs).
"Collections" means, with respect to any Payment Date all payments made by
or on behalf of the Obligors received during the related Collection Period, any
Recoveries received during the related Collection Period, any proceeds from
insurance policies covering the Equipment or related Obligor received during the
related Collection Period, Liquidation Proceeds received during the related
Collection Period, and payments made by a lessee pursuant to its obligation (if
any) to pay the Termination Value pursuant to the related Loan received during
the related Collection Period; provided that "Collections" for the first
Collection Period shall exclude interest accrued before November 1, 2007.
"Commission" means the Securities and Exchange Commission.
7
"Corporate Trust Office" means, with respect to the Indenture Trustee, the
principal office of the Indenture Trustee at which at any particular time its
corporate trust business shall be administered, which office at the date of this
Indenture is located for purposes other than Note transfers and final payment,
at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Structured
Finance Services - GE Midticket 2007-1 (facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇), and for
purposes of Note transfers and final payment, at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Structured Finance Services - GE Midticket 2007-1;
or at such other address as the Indenture Trustee may designate from time to
time by notice to the Noteholders and the Issuer, or the principal corporate
trust office of any successor Indenture Trustee (the address of which the
successor Indenture Trustee will notify the Noteholders and the Sellers).
"Credit and Collection Policies" or "Credit and Collection Policy" means
the policies, practices and procedures adopted by the Issuer for providing
equipment loans secured by transportation equipment, industrial equipment,
construction equipment, furniture and fixtures, technology and
telecommunications equipment, printing presses, maritime assets or other
equipment, including the policies and procedures for determining the
creditworthiness of Obligors and the extension of credit to Obligors, or
relating to the maintenance of such types of loans and collections on such types
of loans.
"Cut-off Date" means September 29, 2007.
"Default" means any occurrence that is, or with notice or the lapse of time
or both would become, an Event of Default.
"Defaulted Loan" means a Loan with respect to which (i) the Servicer on
behalf of the Issuer has repossessed the Equipment securing such Loan and which
is not a Liquidated Loan or (ii) any portion of the Loan Value is deemed
uncollectible in accordance with the Credit and Collection Policy.
"Definitive Notes" is defined in Section 2.9 of this Indenture.
"Delinquent Loan" is defined in Annex A to the Servicing Agreement.
"Deposit Account" is defined in Section 9-102(a)(29) of the UCC.
"Determination Date" means, with respect to any Transfer Date, the second
Business Day prior to such Transfer Date.
"Eligible Deposit Account" means: (a) a segregated deposit account
maintained with a depository institution or trust company whose short-term
unsecured debt obligations are rated at least A-1+ by S&P and P-1 by ▇▇▇▇▇'▇,
(b) a segregated account which is either (i) maintained in the corporate trust
department of the Indenture Trustee or (ii) maintained with a depository
institution or trust company whose long term unsecured debt obligations are
rated at least BBB- by S&P and Baa3 by ▇▇▇▇▇'▇, or (c) a segregated trust
account or similar account maintained with a federally or state chartered
depository institution whose long term unsecured debt obligations are rated at
least BBB- by S&P and Baa3 by ▇▇▇▇▇'▇ subject to regulations regarding fiduciary
funds on deposit substantially similar to 12 C.F.R. Section 9.10(b) in effect on
the Closing Date.
8
"Equipment" means any transportation equipment, industrial equipment,
furniture and fixtures, construction equipment, technology and
telecommunications equipment, printing presses, maritime assets or other
equipment, together with all accessions thereto securing an Obligor's
indebtedness under the respective Loan.
"Equipment Loan" means middle market equipment loans that consist of loans
and finance leases secured by new or used transportation equipment, industrial
equipment, construction equipment, furniture and fixtures, maritime assets,
technology and telecommunications equipment or other equipment made to obligors
in the United States of America and managed by the Capital Solutions division of
GE Capital.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Event of Default" is defined in Section 5.1 of this Indenture.
"Excess Reserve" means, with respect to any Payment Date, the excess of the
Available Reserve Account Amount over the Required Reserve Account Amount.
"Excess Spread Amount" means, with respect to any Payment Date, the
portion, if any, of Available Amounts for such Payment Date remaining after
giving effect to the payments made pursuant to clauses (i) through (vii) under
Section 8.3(a) of the Indenture with respect to any Payment Date prior to an
Event of Default.
"Executive Officer" means, with respect to any corporation, the Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer, President,
Executive Vice President, any Vice President, the Secretary or the Treasurer of
such corporation; and with respect to any partnership, any general partner
▇▇▇▇▇▇▇.
"Federal Book-Entry Regulations" means (a) the Federal regulations listed
on Appendix A to Operating Circular No. 7 issued by the Federal Reserve Banks
and (b) the Federal regulations published at 25 C.F.R. Part 350.
"Final Maturity Date" means the Payment Date in October 2018.
"Financial Asset" has the meaning assigned thereto in Section 8-102 of
Article 8 of the UCC.
"Fitch" means Fitch Ratings and its successors and assigns.
"Fixed Rate Notes" means the Class A-1 Notes, Class A-2a Notes, Class A-3a
Notes, Class B Notes and Class C Notes.
"Floating Rate Notes" means the Class A-2b Notes, Class A-3b Notes and
Class A-4 Notes.
"GE Capital" means General Electric Capital Corporation, a Delaware
corporation.
9
"GECITS" means GE Capital Information Technology Solutions, Inc., a
California corporation.
"GECS" means General Electric Capital Services, Inc. or any successors or
assigns thereto.
"General Intangibles" is defined in Section 9-102(a)(42) of the UCC.
"Grant" means to create and ▇▇▇▇▇ ▇ ▇▇▇▇ pursuant to this Indenture, and
other forms of the verb "to Grant" shall have correlative meanings. A Grant with
respect to the Collateral or any other agreement or instrument shall include a
grant of a Lien upon all rights, powers and options (but none of the
obligations) of the Granting party thereunder, including the right, upon the
occurrence of a Default and declaration thereof by the party to whom such ▇▇▇▇▇
is made, to claim for, collect, receive and give receipt for principal and
interest payments in respect of the Collateral and all other amounts 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.
"Indenture" means this Indenture, dated as of November 20, 2007, between
the Issuer and the Indenture Trustee, as the same may be amended and
supplemented from time to time.
"Indenture Trustee" means The Bank of New York, not in its individual
capacity but solely as Indenture Trustee under this Indenture, or any successor
Indenture Trustee under this Indenture.
"Independent" means, with respect to any specified Person, any such Person
who (i) is in fact independent of any Seller, the Servicer, the Issuer, or any
Affiliate of any thereof, (ii) does not have any direct financial interest, or
any material indirect financial interest in any Seller, the Servicer, the
Issuer, or any Affiliate of any thereof and (iii) is not connected with any
Seller, the Servicer, the Issuer, or any Affiliate of any thereof, as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions; provided, however, that a Person shall not fail to
be Independent of any Seller, the Servicer, the Issuer, or any Affiliate of any
thereof merely because such Person is the beneficial owner of 1% or less of any
class of securities issued by the Issuer, the Servicer, or any Affiliate
thereof, as the case may be.
"Independent Certificate" means a certificate or opinion to be delivered to
the Indenture Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.1 of this Indenture,
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.
"Insolvency Event" means, with respect to a specified Person: (a) the entry
by a court having jurisdiction in the premises of (i) a decree or order for
relief in respect of such Person in an involuntary case or proceeding under any
applicable federal or state bankruptcy, insolvency, reorganization, or other
similar law or (ii) a decree or order adjudging such Person a bankrupt or
10
insolvent, or approving as properly filed a petition seeking reorganization,
arrangement, adjustment, or composition of or in respect of such Person under
any applicable Federal or State law, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator, or other similar official of such
Person or of any substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or order for
relief or any such other decree or order unstayed and in effect for a period of
60 consecutive days; or (b) the commencement by such Person of a voluntary case
or proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization, or other similar law or of any other case or proceeding to be
adjudicated a bankrupt or insolvent, or the consent by it to the entry of a
decree or order for relief in respect of such Person in an involuntary case or
proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization, or other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against it, or the filing by it of a petition or
answer or consent seeking reorganization or relief under any applicable federal
or state law, or the consent by it to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver, liquidator,
assignee, trustee, sequestrator, or similar official of such Person or of any
substantial part of its property, or the making by it of an assignment for the
benefit of creditors, or such Person's failure to pay its debts generally as
they become due, or the taking of corporate action by such Person in furtherance
of any such action.
"Instruments" has the meaning assigned thereto in Section 9-102 of Article
9 of the UCC.
"Interest Accrual Period" means, with respect to any Payment Date (the
"current Payment Date") and (a) the Class A-1 Notes and the Floating Rate Notes,
the period from and including the preceding Payment Date (or, in the case of the
initial Payment Date, from and including the Closing Date) to but excluding the
current Payment Date; or (b) the Fixed Rate Notes (other than the Class A-1
Notes), the period from and including the 14th day of each calendar month (or,
in the case of the initial Payment Date, from and including the Closing Date) to
but excluding the 14th day of the succeeding calendar month.
"Interest Rate" means (i) as to the Class A-1 Notes, the Class A-1 Interest
Rate, (ii) as to the Class A-2a Notes, the Class A-2a Interest Rate, (iii) as to
the Class A-2b Notes, the Class A-2b Interest Rate, (iv) as to the Class A-3a
Notes, the Class A-3a Interest Rate, (v) as to the Class A-3b Notes, the Class
A-3b Interest Rate, (vi) as to the Class A-4 Notes, the Class A-4 Interest Rate,
(vii) as to the Class B Notes, the Class B Interest Rate, and (viii) as to the
Class C Notes, the Class C Interest Rate.
"Investment Company Act" means the provisions of the Investment Company Act
of 1940, 15 U.S.C Sections 80a et seq., as amended from time to time, and any
regulations promulgated thereunder.
"Investment Earnings" means, with respect to any Payment Date, the interest
and other investment earnings (net of losses and investment expenses) on amounts
on deposit in the Trust Accounts to be included as part of Available Amounts
pursuant to Section 8.6(a).
"Investment Property" is defined in Section 9-102(a)(49) of the UCC.
11
"Issuer" means GE Equipment Midticket LLC, Series 2007-1, a Delaware
limited liability company, until a successor replaces it and, thereafter, means
the successor and, for purposes of any provision contained in this Indenture and
required by the TIA, each other obligor on the Notes.
"Issuer Limited Liability Company Agreement" means the Limited Liability
Company Agreement of the Issuer, dated as of November 20, 2007, as the same may
be amended or supplemented from time to time.
"Issuer Order" and "Issuer Request" means a written order or request,
respectively, signed in the name of the Issuer by any one of its Authorized
Officers and delivered to the Indenture Trustee.
"LIBOR" is defined in Section 2.16 of this Indenture.
"LIBOR Business Day" means any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the city of London, England are
required to or authorized by law to be closed.
"LIBOR Rate Adjustment Date" is defined in Section 2.16 of this Indenture.
"Lien" means a security interest (as such term is defined in Section 1-201
of Article 1 of the UCC), lien, charge, pledge, equity or encumbrance of any
kind, other than tax liens, mechanics' liens and any liens that attach to the
related Loan by operation of law as a result of any act or omission by the
related Obligor.
"Liquidated Loan" means any Loan (i) liquidated through the sale or other
disposition of all or a portion of the related Equipment or (ii) that has been
charged off in its entirety in accordance with the Credit and Collection Policy
without realizing upon the Equipment.
"Liquidation Proceeds" means, with respect to any Liquidated Loan, the
amounts collected in respect thereof from whatever source (including the
proceeds of insurance policies with respect to the related Equipment or Obligor)
during the Collection Period in which it became a Liquidated Loan, net of the
sum of any amounts expended in connection with such liquidation and any amounts
required by law to be remitted to the Obligor on such Liquidated Loan or any
creditor of such Obligor to the extent required by applicable law or agreement.
"Loan" means any agreement (including any invoice) pursuant to, or under
which, an Obligor shall be obligated to make payments with respect to any
Equipment Loan owned by the Issuer.
"Loan Files" means the documents specified in Section 2.1 of the Sale
Agreement.
"Loan Value" is defined in the Purchase and Sale Agreement.
"Managing Member" means CEF Equipment Holding, L.L.C., a Delaware limited
liability company, or any successor Managing Member under the Issuer Limited
Liability Company Agreement.
12
"Maturity Date" means (i) as to the Class A-1 Notes, the Class A-1 Maturity
Date, (ii) as to the Class A-2 Notes, the Class A-2 Maturity Date, (iii) as to
the Class A-3 Notes, the Class A-3 Maturity Date, (iv) as to the Class A-4
Notes, the Class A-4 Maturity Date, (v) as to the Class B Notes, the Class B
Maturity Date, and (vi) as to the Class C Notes, the Class C Maturity Date.
"Monthly Interest Amount Payable" means, with respect to any Payment Date
(the "current Payment Date") and any Class of Notes, an amount equal to the sum
of (a) the aggregate amount of interest accrued on that Class of Notes at the
applicable Interest Rate from and including the preceding Payment Date (or, in
the case of the initial Payment Date from and including the Closing Date) to but
excluding the current Payment Date plus (b) the Monthly Interest Shortfall for
that Class of Notes and the current Payment Date.
"Monthly Interest Shortfall" means, with respect to any Payment Date (the
"current Payment Date") and any Class of Notes, the excess of the Monthly
Interest Amount Payable for the preceding Payment Date over the amount in
respect of interest on that Class of Notes that was actually paid to the
Noteholder for that Class of Notes on such preceding Payment Date, plus interest
on such excess, to the extent permitted by law, at a rate per annum equal to the
Interest Rate on that Class of Notes, from such preceding Payment Date to but
excluding the current Payment Date.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. or any successor thereto.
"Note Balance" means the aggregate Outstanding Principal Balance of the
Notes from time to time.
"Note Distribution Account" means the account designated as such,
established and owned by the Issuer and maintained in accordance with Section
8.2(a) of this Indenture.
"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 the Clearing
Agency (directly as a Clearing Agency Participant or as an indirect participant,
in each case in accordance with the rules of the Clearing Agency).
"Note Pool Factor" means, as of the close of business on any Payment Date
with respect to any Class of Notes, the Outstanding Principal Balance of that
Class of Notes divided by the original Outstanding Principal Balance of that
Class of Notes (carried out to the seventh decimal place). The Note Pool Factor
for each Class will be 1.0000000 as of the Closing Date, and, thereafter, will
decline to reflect reductions in the Outstanding Principal Balance of the Notes.
"Note Register" and "Note Registrar" have the respective meanings specified
in Section 2.4 of this Indenture.
"Noteholder" means the person in whose name a Class A, Class B or Class C
Note is registered on the Note Register.
"Notes" means the Class A Notes, the Class B Notes and the Class C Notes.
13
"Obligor" means, as to each Loan, any Person who owes payments under the
Loan.
"Officers' Certificate" means, as to any Person, a certificate signed by an
Authorized Officer of such Person.
"Opinion of Counsel" means a written opinion of counsel (who may, except as
otherwise expressly provided in this Indenture, be an employee of or counsel to
the Issuer or an Affiliate of the Issuer), which counsel and opinion shall be
acceptable to the Indenture Trustee, or the Rating Agencies, as applicable.
"Other Assets" is defined in Section 11.20 of this Indenture.
"Outstanding" means, as of the date of determination, all Notes theretofore
authenticated and delivered under this Indenture except:
(i) Notes theretofore canceled by the Note Registrar or delivered to
the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which funds in the
necessary amount have been theretofore deposited with the Indenture Trustee
or any Paying Agent in trust for the Noteholders (provided, however, that
if such Notes are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture); and
(iii) Notes in exchange for or in lieu of other Notes that 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, that in determining whether the
Noteholders of the requisite Outstanding Principal Balance of the Notes
have given any request, demand, authorization, direction, notice, consent
or waiver hereunder or under any Related Document, Notes owned by the
Issuer or any Affiliate thereof shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Indenture Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes that a Responsible Officer
of the Indenture Trustee actually 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 or any Affiliate thereof.
"Outstanding Principal Balance" means the aggregate principal amount of all
Notes, or Class of Notes, as applicable, Outstanding at the date of
determination.
"Overcollateralization Amount" means, with respect to any Payment Date, the
excess, if any, of (i) the Pool Balance at the beginning of the related
Collection Period over (ii) the aggregate Outstanding Principal Balance of the
Class A Notes, Class B Notes and Class C Notes before giving effect to any
principal payments made on the Notes on such Payment Date.
"Paying Agent" means with respect to the Notes, initially the Indenture
Trustee or any other Person that meets the eligibility standards for the
Indenture Trustee specified in
14
Section 6.11 of this Indenture and is authorized by the Issuer to make the
distributions from the Note Distribution Account, including payment of principal
of or interest on the Notes on behalf of the Issuer.
"Payment Date" means, with respect to each Collection Period, the 14th day
of the calendar month following the end of that Collection Period, or, if such
day is not a Business Day, the next Business Day, commencing on December 14,
2007.
"Permitted Investments" means one or more of the following:
(a) obligations of, or guaranteed as to the full and timely payment of
principal and interest by, the United States or obligations of any agency
or instrumentality thereof, when such obligations are backed by the full
faith and credit of the United States;
(b) repurchase agreements on obligations specified in clause (a);
provided, that the short-term debt obligations of the party agreeing to
repurchase are rated at least A-1+ by S&P and P-1 by Moody's;
(c) federal funds, certificates of deposit, time deposits and bankers'
acceptances (which shall each have an original maturity of not more than 90
days or, in the case of bankers' acceptances, shall in no event have an
original maturity of more than 365 days) of any United States depository
institution or trust company incorporated under the laws of the United
States or any State thereof or of any United States branch or agency of a
foreign commercial bank; provided that the short-term debt obligations of
such depository institution or trust company are rated at least A-1+ by S&P
and P-1 by ▇▇▇▇▇'▇;
(d) commercial paper (having original maturities of not more than 30
days) which on the date of acquisition are rated at least A-1+ by S&P and
P-1 by ▇▇▇▇▇'▇;
(e) securities of money market funds rated at least A-1+ by S&P and
P-1 by ▇▇▇▇▇'▇; and
(f) any other investment acceptable to each of the Rating Agencies as
set forth in writing delivered to the Indenture Trustee; provided, that
investments described in clauses (e) and (f) shall be made only so long as
making such investments will not require the Issuer to register as an
investment company under the Investment Company Act of 1940, as amended.
"Person" means any individual, sole proprietorship, partnership, joint
venture, unincorporated organization, trust, association, corporation (including
a business trust), limited liability company, institution, public benefit
corporation, joint stock company, or government or any agency or political
subdivision thereof, or any other entity of whatever nature.
"Pool Balance" means, with respect to the beginning of any calendar month,
the sum of the aggregate Loan Values of the Loans at the opening of business on
the first day of such calendar month.
15
"Precomputed Loan" means any Loan under which the portion of a payment
allocable to earned interest (which may be referred to in the related Loan as an
add-on finance charge) and the portion allocable to principal are determined
according to the sum of periodic balances, the sum of monthly payments or any
equivalent method or are monthly actuarial loans.
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.5 of this Indenture in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.
"Proceeding" means any suit in equity, action at law or other judicial or
administrative proceeding.
"Promissory Note" is defined in Section 9-102(a)(65) of the UCC.
"Purchase Amount" means, as of the close of business on the last day of a
Collection Period, an amount equal to the Loan Value of the applicable Loan, as
of the first day of the immediately following Collection Period (or, with
respect to any applicable Loan that is a Liquidated Loan or Defaulted Loan, as
of the day immediately prior to such Loan becoming a Liquidated Loan or
Defaulted Loan less any Liquidation Proceeds actually received by the Issuer)
plus interest accrued and unpaid thereon as of such last day at a rate per annum
equal to the APR for such Loan.
"Purchase and Sale Agreement" means the Purchase and Sale Agreement, dated
as of November 20, 2007 between the Purchaser and the Issuer, as the same may be
amended or supplemented from time to time.
"Purchased Loan" means a Loan repurchased as of the close of business on
the last day of a Collection Period by the Seller pursuant to the Sale Agreement
and repurchased as of such time by CEF Equipment Holding, L.L.C. pursuant to the
Purchase and Sale Agreement.
"Purchaser" means CEF Equipment Holding, L.L.C., a Delaware limited
liability company, in its capacity as the purchaser, and its successors and
assigns.
"Rating Agency" means each of Fitch, Moody's and S&P. If any of such
organizations or its successor is no longer in existence, the Issuer shall
designate a nationally recognized statistical rating organization or other
comparable Person as a substitute Rating Agency, notice of which designation
shall be given to the Indenture Trustee and the Servicer.
"Rating Agency Condition" means, with respect to any action, that (i) each
Rating Agency (other than Moody's) shall have been given prior notice thereof
and that each of the Rating Agencies (other than Moody's) shall have notified
the Issuer and the Indenture Trustee in writing that such action will not result
in a reduction or withdrawal of the then current rating of any Class of the
Notes and (ii) Moody's shall have been given at least 10 Business Days' prior
notice thereof and shall have not notified the Issuer and the Indenture Trustee
that such action will result in a reduction or withdrawal of the then current
rating of any Class of the Notes.
16
"Record Date" means, with respect to a Payment Date or Redemption Date, the
close of business on the Business Day preceding such Payment Date or Redemption
Date, or, if Definitive Notes are issued, the close of business on the last day
of the calendar month preceding the month of such Payment Date, whether or not
such day is a Business Day, or if Definitive Notes were not outstanding on such
date, the date of issuance of the Definitive Notes.
"Records" means all documents, books, records and other information
(including computer programs, tapes, disks, data processing software and related
property and rights) prepared and maintained by the Issuer with respect to the
Loans and the Obligors thereunder.
"Recoveries" means, with respect to any Liquidated Loan, monies collected
in respect thereof, from whatever source (other than from the sale or other
disposition of the Equipment), after such Loan became a Liquidated Loan.
"Redemption Date" means the Payment Date specified by the Issuer pursuant
to Section 10.1 of this Indenture, as applicable.
"Redemption Price" means the unpaid principal amount of the Notes redeemed,
plus accrued and unpaid interest thereon at the applicable interest rate to but
excluding the Redemption Date.
"Regulation AB" means Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. Sections 229.1100-229.1123, as such may be amended
from time to time, and subject to such clarification and interpretation as have
been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan.
7, 2005)) or by the staff of the Commission, or as may be provided by the
Commission or its staff from time to time.
"Related Documents" means the Sale Agreement, the Purchase and Sale
Agreement, the Servicing Agreement, the Indenture, the Issuer Limited Liability
Company Agreement, the CEF Limited Liability Company Agreement, the
Administration Agreement, the Swap Agreement and all other agreements,
instruments, and documents and including all other pledges, powers of attorney,
consents, assignments, contracts, notices, and all other written matter whether
heretofore, now or hereafter executed by or on behalf of any Person, or any
employee of any Person, and delivered in connection with any of the foregoing.
Any reference in the foregoing documents to a Related Document shall include all
Annexes, Exhibits and Schedules thereto, and all amendments, restatements,
supplements or other modifications thereto, and shall refer to such Related
Document as the same may be in effect at any and all times such reference
becomes operative.
"Related Security" means with respect to any Loan: (a) any interest
(including security interests), if any, in the related Equipment; (b) all
guarantees, insurance or other agreements or arrangements of any kind from time
to time supporting or securing payment of such Loan (including rights (if any)
to receive proceeds on insurance policies covering the Obligors); and (c) all
Records relating to such Loan.
Required Reserve Account Amount" means as of the Closing Date and any
Payment Date thereafter, the lesser of (i) the Outstanding Principal Balance of
the Notes and (ii) the greater of
17
(a) 1.00% of the initial aggregate Loan Value and (b) 1.50% of the initial
aggregate Loan Value, less the excess, if any, of (i) the aggregate Loan Value
as of the end of the related Collection Period minus the Note Balance at the end
of the related Payment Date over (ii) 0.45% of the initial aggregate Loan Value.
"Reserve Account" means the account designated as such, established and
owned by the Issuer and maintained in accordance with Section 8.2.
"Reserve Account Deficiency" means the excess, if any, of the Required
Reserve Account Amount over the Available Reserve Account Amount.
"Responsible Officer" means, with respect to the Indenture Trustee, any
officer within the Corporate Trust Office of the Indenture Trustee, including
any Vice President, Assistant Vice President, Secretary or Assistant Secretary,
or any other officer of the Indenture Trustee customarily performing functions
similar to those performed by any of the above designated officers and also,
with respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"S&P" means Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., or any successor thereto.
"Sale Agreement" means the Sale Agreement, dated as of November 20, 2007,
among GE Capital, GECITS, VFS and the Purchaser, as the same may be amended or
supplemented from time to time.
"Scheduled Payment" on a Loan means that portion of the payment required to
be made by the Obligor during any Collection Period sufficient to amortize the
loan balance under (x) in the case of a Precomputed Loan, the actuarial method
or (y) in the case of a Simple Interest Loan, the simple interest method, in
each case, over the term of the Loan and to provide interest at the APR;
provided that Termination Values shall also constitute Scheduled Payments.
"Securities Account" has the meaning assigned thereto in Section 8-501(a)
of Article 8 of the UCC.
"Securities Act" means the Securities Act of 1933 15 U.S.C. 77a et seq., as
amended, and any regulations promulgated thereunder.
"Securities Exchange Act" means the provisions of the Securities Exchange
Act of 1934 15 U.S.C. Sections 78a et seq., as amended, and any regulations
promulgated thereunder.
"Securities Intermediary" is defined in Section 8-102 of Article 8 of the
UCC.
"Seller" means each of GE Capital, GECITS or VFS, in its capacity as the
seller, its successors and assigns.
"Servicer" means GE Capital, as the Servicer under the Servicing Agreement,
as the case may be, or any other Person designated as a Successor Servicer under
such agreement.
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"Servicing Criteria" means the "servicing criteria" set forth in Item
1122(d) of Regulation AB, as such may be amended from time to time.
"Servicer Default" means an event specified in Section 5.1 of the Servicing
Agreement.
"Servicing Advance" is defined in Annex A to the Servicing Agreement.
"Servicing Agreement" means the Servicing Agreement, dated as of November
20, 2007, between the Issuer and the Servicer, as the same may be amended or
supplemented from time to time.
"Servicing Fee" is defined in Annex A to the Servicing Agreement.
"Simple Interest Loan" means any Loan under which the portion of a payment
allocable to interest and the portion allocable to principal is determined by
allocating a fixed level payment between principal and interest, such that such
payment is allocated first to the accrued and unpaid interest at the Annual
Percentage Rate for such Loan on the unpaid principal balance and the remainder
of such payment is allocable to principal.
"State" means any one of the 50 states of the United States of America or
the District of Columbia.
"Sub-Servicer" is defined in Annex A to the Servicing Agreement.
"Successor Servicer" is defined in Section 6.2 of the Servicing Agreement.
"Swap Agreement" means the 2002 ISDA Master Agreement dated as of November
20, 2007, including all schedules and confirmations thereto between the Issuer
and GECS, in its capacity as Swap Counterparty, as the same may be amended,
supplemented, renewed, extended or replaced from time to time.
"Swap Counterparty" means GECS, solely in its capacity as a swap
counterparty, and any successors or assigns thereto.
"Swap Event of Default" means a "Swap Event of Default" or similar term as
provided in the Swap Agreement.
"Swap Payments Incoming" means on any Payment Date the net amount, if any,
then payable by the Swap Counterparty to the Issuer, excluding any Swap
Termination Payments.
"Swap Payments Outgoing" means on any Payment Date the net amount, if any,
then payable by the Issuer to the Swap Counterparty, excluding any applicable
Swap Termination Payments.
"Swap Termination Event" means a "Swap Termination Event" or similar term
as provided in the Swap Agreement.
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"Swap Termination Payment" means any termination payment payable by the
Issuer to the Swap Counterparty or by the Swap Counterparty to the Issuer under
the Swap Agreement.
"Termination Value" means the "Termination Value" (if any) payable by a
lessee pursuant to the applicable Loan.
"TIA" or the "Trust Indenture Act" means the Trust Indenture Act of 1939,
as in force on the date of this Indenture unless otherwise specifically
provided.
"Transfer Date" means the Business Day preceding the fourteenth day of each
calendar month.
"Treasury Regulations" means regulations, including proposed or temporary
regulations, promulgated under the Code. References to specific provisions of
proposed or temporary regulations shall include analogous provisions of final
Treasury Regulations or other successor Treasury Regulations.
"Trust Account Property" means the Trust Accounts, all amounts, Financial
Assets, Investment Property and other investments or other property held from
time to time in or credited to any Trust Account and all proceeds of the
foregoing.
"Trust Accounts" has the meaning assigned thereto in Section 8.2(a) of this
Indenture.
"UCC" means, unless the context otherwise requires, the Uniform Commercial
Code as in effect in the relevant jurisdiction, as amended from time to time.
"VFS" means VFS Financing, Inc., a Delaware corporation.
SECTION 1.2. Other Interpretive Matters. All terms defined directly or by
incorporation in this Indenture shall have the defined meanings when used in any
document delivered pursuant thereto unless otherwise defined therein. For
purposes of this Indenture, unless the context otherwise requires: (a)
accounting terms not otherwise defined herein and accounting terms partly
defined herein to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles; and unless
otherwise provided, references to any month, quarter or year refer to a fiscal
month, quarter or year as determined in accordance with the fiscal calendar of
GECS; (b) unless defined in this Indenture or the context otherwise requires,
capitalized terms used in this Indenture which are defined in the UCC shall have
the meaning given such term in the UCC; (c) references to any amount as on
deposit or outstanding on any particular date means such amount at the close of
business on such day; (d) the words "hereof," "herein" and "hereunder" and words
of similar import refer to this Indenture as a whole and not to any particular
provision of this Indenture; (e) references to any Section, Schedule or Exhibit
are references to Sections, Schedules and Exhibits in or to this Indenture, and
references to any paragraph, subsection, clause or other subdivision within any
Section or definition refer to such paragraph, subsection, clause or other
subdivision of such Section or definition; (f) the term "including" means
"including without limitation"; (g) references to any law or regulation refer to
that law or regulation as amended from time to time and include any successor
law or regulation; (h) references to any agreement refer to that agreement as
from time to time amended, restated or supplemented or as the terms of such
20
agreement are waived or modified in accordance with its terms; (i) references to
any Person include that Person's successors and assigns; and (j) headings are
for purposes of reference only and shall not otherwise affect the meaning or
interpretation of any provision hereof.
SECTION 1.3. Incorporation by Reference of TIA. 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 terms, where used in the TIA,
shall have the following meanings for the purposes hereof:
"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.
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.
ARTICLE II
THE NOTES
SECTION 2.1. Form. The Notes shall consist of $243,000,000 principal amount
of Class A-1 Notes, $75,000,000 principal amount of Class A-2a Notes,
$208,000,000 principal amount of Class A-2b Notes, $53,000,000 principal amount
of Class A-3a Notes, $200,000,000 principal amount of Class A-3b Notes,
$311,727,000 principal amount of Class A-4 Notes, $26,728,000 principal amount
of Class B Notes, and $19,904,000 principal amount of Class C Notes and the
forms thereof and the Indenture Trustee's certificate of authentication, shall
be in substantially the forms set forth in Exhibits A-1, A-2 and A-3,
respectively, 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.
The Definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the officers executing such Notes, as
evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication. The terms of the
Notes set forth in Exhibits A-1, A-2 and A-3 are part of the terms of this
Indenture.
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The aggregate principal amount of Notes which may be authenticated and
delivered under this Indenture is limited to $1,137,359,000 of Notes, except for
Notes authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Notes pursuant to Sections 2.4, 2.5 or 9.5.
The Notes shall be issuable only in registered form and only in minimum
denominations of at least $1,000; provided that the foregoing shall not restrict
or prevent the transfer in accordance with Section 2.4 of any Note having an
Outstanding Principal Balance of other than an integral multiple of $1,000, or
the issuance of a single Note of each Class, with a denomination less than
$1,000.
SECTION 2.2. Execution, Authentication and Delivery. (a) The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
(b) Notes bearing the manual or facsimile signature of individuals who were
at the time of signature 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.
(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 herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate of authentication shall be
conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.
(d) The Notes may from time to time be executed by the Issuer and delivered
to the Indenture Trustee for authentication together with an Issuer Request to
the Indenture Trustee directing the authentication and delivery of such Notes
and thereupon the same shall be authenticated and delivered by the Indenture
Trustee in accordance with such Issuer Request.
SECTION 2.3. Temporary Notes. Pending the preparation of Definitive Notes,
the Issuer may execute, and upon receipt of an Issuer Order, the Indenture
Trustee shall authenticate and deliver, temporary Notes of the tenor of the
Definitive Notes in lieu of which they are issued and with such variations not
inconsistent with this Indenture as the officers executing such Notes may
determine, as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuer will cause Definitive Notes to be
prepared without unreasonable delay. After the preparation of Definitive Notes,
the temporary Notes shall be exchangeable for Definitive Notes upon surrender of
the temporary Notes at the office or agency of the Issuer to be maintained as
provided in Section 3.2, without charge to the Noteholder. Upon surrender for
cancellation of any one or more temporary Notes, the Issuer shall execute and
the Indenture Trustee shall authenticate and deliver in exchange therefor a like
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 if they were Definitive Notes.
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SECTION 2.4. Registration; Registration of Transfer and Exchange. (a) The
Issuer shall cause to be kept a register (the "Note Register") in which, subject
to such reasonable regulations as it may prescribe, the Issuer shall provide for
the registration of Notes and the registration of transfers of Notes. The Issuer
hereby appoints the Indenture Trustee as 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 is unable to make such an appointment, assume the duties of the Note
Registrar.
If a Person other than the Indenture Trustee is appointed by the Issuer as
the 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, to obtain
copies thereof and 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.
The Indenture Trustee shall not register the transfer of any Note (other
than the transfer of a Note to the nominee of the Clearing Agency) unless the
transferee has executed and delivered to the Indenture Trustee a certification
to the effect that either (i) the transferee is not acquiring and will not hold
any Note with the assets of (a) an "employee benefit plan" (as defined in
Section 3(3) of ERISA) that is subject to Title I of ERISA, (b) a "plan" (as
defined in Section 4975(e)(1) of the Code) that is subject to Section 4975 of
the Code, (c) an entity that is deemed to hold assets of such employee benefit
plan or plan (each of the foregoing, a "Benefit Plan") or (d) other plan that is
subject to any law that is substantially similar to ERISA or Section 4975 of the
Code, or (ii) the transferee's acquisition and continued holding of the Note
will not give rise to a nonexempt prohibited transaction under ERISA, Section
4975 of the Code or any substantially similar applicable law. Each transferee of
a Book-Entry Note shall be deemed to make one of the foregoing representations.
(b) Subject to Section 2.4(a), upon surrender for registration of transfer
of any Note at the office or agency of the Issuer to be maintained as provided
in Section 3.2, if the requirements of Section 8-401(a)(1) of the UCC are met,
the Issuer shall execute, 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 in any authorized
denominations of a like aggregate principal amount. At the option of the
Noteholder, Notes may be exchanged for other new 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, if the requirements of Section 8-401(a)(1) of the UCC
are met, the Issuer shall execute, the Indenture Trustee shall authenticate and
the Noteholder shall obtain from the Indenture Trustee, the Notes that the
Noteholder making the exchange is entitled to receive. The Indenture Trustee
shall make a notation on any such new Note of the amount of principal, if any,
that has been paid on such Note.
(c) 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.
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(d) Every Note presented or surrendered for registration of transfer or
exchange shall (if so required by the Issuer or the Indenture Trustee) be duly
endorsed by, or be accompanied by a written instrument of transfer in form
satisfactory to the Issuer and the Indenture Trustee duly executed by, the
Noteholder thereof or such Noteholder's attorney duly authorized in writing,
with such signature guaranteed by an "eligible guarantor institution" meeting
the requirements of the Note Registrar, which requirements include membership or
participation in the Securities Transfer Agent's Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Note
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Securities Exchange Act.
(e) No service charge shall be made to a Noteholder for any registration of
transfer or exchange of Notes, but the Issuer or the Indenture Trustee will
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 2.3 or 9.5.
SECTION 2.5. 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 such security or
indemnity as may be required by the Indenture Trustee and the Issuer to hold the
Indenture Trustee and the Issuer, respectively, 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, and provided that the
requirements of Section 8-405 of the UCC are met, the Issuer shall execute, and
upon its request the Indenture Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a
replacement Note of the same Class and principal amount and bearing a number not
contemporaneously outstanding; 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
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 payment made) or any assignee of such Person, except a bona fide purchaser,
and shall be entitled to recover upon the security or indemnity provided
therefor to the extent of any loss, damage, cost or expense incurred by the
Issuer or the 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 such Noteholder 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) connected therewith.
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(c) Every replacement Note issued pursuant to this Section in replacement
of any mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuer, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
(d) The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.6. Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee 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 neither the Issuer, the Indenture Trustee nor any agent of the
Issuer or the Indenture Trustee shall be affected by notice to the contrary.
SECTION 2.7. Payment of Principal and Interest; Defaulted Interest. (a) Any
installment of interest or principal, if any, payable on any Note that 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. However, unless Definitive Notes have been issued, with
respect to Notes registered on the Record Date in the name of the nominee of the
Clearing Agency (initially, such nominee to be Cede & Co.), payment will be made
by wire transfer in immediately available funds to the account designated by
such nominee. Notwithstanding the above, the final installment of principal
payable with respect to such Note (and except for the Redemption Price for any
Note called for redemption pursuant to Section 10.1) shall be payable as
provided in clause (b)(ii). The funds represented by any such checks returned
undelivered shall be held in accordance with Section 6.16.
(b) (i) The principal of each Note shall be payable in installments on each
Payment Date as provided in Section 8.3.
(ii) Notwithstanding the foregoing, the entire Outstanding
Principal Balance shall be due and payable on: (A) the date on which
an Event of Default shall have occurred and be continuing if the
Indenture Trustee or the Noteholders representing not less than a
majority of the Outstanding Principal Balance of the Notes have
declared the Notes to be immediately due and payable in the manner
provided in Section 5.2, and (B) if any Notes remain Outstanding, the
Maturity Date.
(iii) Except as otherwise provided in Section 5.2, no part of the
principal of any Note shall be paid prior to the Payment Date on which
such principal is due in accordance with the preceding provisions of
this Section,
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except that the Issuer may redeem the Notes in their entirety in
accordance with Section 10.1.
(iv) 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 no later than five days prior to such
final Payment Date 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.
(v) All reductions in the principal amount of a Note effected by
payments of installments of principal made on any Payment Date shall
be binding upon all holders of such Note and of any Note issued upon
the registration of transfer thereof or in exchange therefore or in
lieu thereof, whether or not such payment is noted on such Note. All
payments on the Notes shall be made without any requirement of
presentment but each holder of any Note shall be deemed to agree, by
its acceptance of the same, to surrender such Note at the Corporate
Trust Office against payment of the final installment of principal of
such Note.
(c) (i) For each Payment Date, the interest due and payable with respect to
the Class A-1 Notes, Class A-2a Notes, Class A-2b Notes, Class A-3a Notes, Class
A-3b Notes, Class A-4 Notes, Class B Notes and Class C Notes will be the
interest that has accrued on the respective Notes since the last Payment Date
or, in the case of the first Payment Date, since the Closing Date, at the Class
A-1 Interest Rate, Class A-2a Interest Rate, Class A-2b Interest Rate, Class
A-3a Interest Rate, Class A-3b Interest Rate, Class A-4 Interest Rate, Class B
Interest Rate and Class C Interest Rate, respectively, applied to the then
Outstanding Principal Balances of the Class A-1 Notes, Class A-2a Notes, Class
A-2b Notes, Class A-3a Notes, Class A-3b Notes, Class A-4 Notes, Class B Notes
and, as applicable, the Class C Notes, respectively, on the preceding Payment
Date subject to Section 3.1. With respect to the Floating Rate Notes and the
Class A-1 Notes, the interest will be calculated on the basis of the actual
number of days in the applicable Interest Accrual Period and a 360 day year.
With respect to the Fixed Rate Notes (other than the Class A-1 Notes), the
interest will be calculated on the basis of a 360-day year of twelve 30-day
months.
(ii) If the Issuer defaults in a payment of interest on the
Notes, the Issuer shall pay, in any lawful manner, defaulted interest
(plus interest on such defaulted interest to the extent lawful) at the
applicable interest rate from the Payment Date for which such payment
is in default. The Issuer shall pay such defaulted interest on a
subsequent special payment date declared by the Issuer to the Persons
who are Noteholders on a subsequent special record date, which special
record date shall be at least five Business Days prior to the special
payment date. At least 15 days before any such special record date,
the Issuer shall mail to each Noteholder a notice that states the
special record date, the special payment date and the amount of
defaulted interest to be paid.
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(d) All payments made with respect to any Note shall be made in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts and shall be applied first to the
interest then due and payable on such Notes and then to the principal thereof.
SECTION 2.8. 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 at the
applicable Corporate Trust Office and shall be promptly canceled by the
Indenture Trustee. The Issuer may at any time deliver to the Indenture Trustee
for cancellation any Notes previously authenticated and delivered hereunder that
the Issuer may have acquired in any manner whatsoever, and all Notes so
delivered shall be promptly canceled by the Indenture Trustee. No Notes shall be
authenticated in lieu of or in exchange for any Notes canceled as provided in
this Section except as expressly permitted by this Indenture. All canceled Notes
may be held or disposed of by the Indenture Trustee in accordance with its
standard retention or disposal policy as in effect at the time unless the Issuer
shall direct by an Issuer Order that they be returned to it; provided, that such
Issuer Order is timely and the Notes have not been previously disposed of by the
Indenture Trustee.
SECTION 2.9. Book-Entry Notes. Each of the Class A Notes, the Class B Notes
and the Class C Notes, upon original issuance, will be issued in the form of
typewritten Notes representing the Book-Entry Notes, to be delivered to The
Depository Trust Company (the initial Clearing Agency), or its custodian, by, or
on behalf of, the Issuer. Each of the Class A Notes, the Class B Notes and the
Class C Notes shall initially be registered on the Note Register in the name of
Cede & Co., the nominee of The Depository Trust Company as the initial Clearing
Agency, and no Class A Note Owner, Class B Note Owner or Class C 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") representing the Class A Notes, the
Class B Notes or the Class C Notes have been issued to the applicable Note
Owners:
(i) the Issuer, the Note Registrar and the Indenture Trustee, and
their officers, directors, employees and agents may deal with the
Clearing Agency for all purposes (including the payment of principal
of and interest on the Class A Notes, the Class B Notes and the Class
C Notes) as the sole Noteholder and shall have no obligations to the
Note Owners;
(ii) to the extent that this Section conflicts with any other
provisions of this Indenture, this Section shall control;
(iii) the rights of the respective Note Owners shall be exercised
only through the Clearing Agency and the Clearing Agency Participants
and shall be limited to those established by law and agreements
between such respective Note Owners and the Clearing Agency and/or the
Clearing Agency Participants pursuant to this Indenture. Unless and
until Definitive Notes are issued pursuant to Section 2.11, the Issuer
intends that 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 related Class A Notes, Class B Notes
27
and Class C Notes, as the case may be, to such Clearing Agency
Participants (and neither the Indenture Trustee nor the Note Registrar
shall have any liability therefor); and
(iv) whenever this Indenture requires or permits actions to be
taken based upon instructions, directions, or the consent of
Noteholders evidencing a specified percentage of the Outstanding
Principal Balance of the Notes (or a Class of Notes), the Clearing
Agency shall be deemed to represent such percentage only to the extent
that it has received instructions to such effect from Note Owners
and/or Clearing Agency Participants owning or representing,
respectively, such required percentage of the beneficial interest in
the Notes (or Class of 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 Class A Noteholders, Class B Noteholders or Class C
Noteholders is required under this Indenture, unless and until Definitive Notes
have been issued to the related Note Owners, the Indenture Trustee shall give
all such notices and communications to the Clearing Agency.
SECTION 2.11. Definitive Notes. (a) If: (i) the Issuer advises the
Indenture Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities under this Indenture with
respect to the Notes, and the Issuer is unable to locate a qualified successor,
(ii) the Issuer advises the Indenture Trustee in writing that it elects to
terminate the book-entry system and, upon receipt of a notice of intent from the
Clearing Agency, the participants holding beneficial interests in the Notes
agree to initiate a termination or (iii) after the occurrence of an Event of
Default or a Servicer Default, Note Owners representing beneficial interests
aggregating at least a majority of the Outstanding Principal Balance of the
Notes advise the Clearing Agency in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interests
of the Note Owners, then the Indenture Trustee shall notify all Note Owners of
the occurrence of such event and of the availability of Definitive Notes to Note
Owners requesting the same. Upon surrender to the Indenture Trustee of the
typewritten Notes representing the Book-Entry Notes by the Clearing Agency,
accompanied by registration and transfer instructions from the Clearing Agency
for registration, the Issuer shall execute, and the Indenture Trustee shall
authenticate, the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the Indenture Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Notes, all references herein to obligations
imposed upon or to be performed by the Clearing Agency shall be deemed to be
imposed upon and performed by the Issuer, to the extent applicable with respect
to such Definitive Notes, and the Issuer shall recognize the holders of the
relevant Definitive Notes as Noteholders hereunder.
(b) Definitive Notes will not be eligible for clearing or settlement
through DTC, Euroclear or Clearstream.
SECTION 2.12. Notes owned by the Issuer or its Affiliates. In determining
whether the Noteholders of the required Outstanding Principal Balance of the
Notes have concurred in any
28
direction, waiver or consent, Notes owned by the Issuer or an Affiliate of the
Issuer shall be considered as though not Outstanding, except that for the
purposes of determining whether the Indenture Trustee shall be protected in
relying on any such direction, waiver or consent, only Notes which a Responsible
Officer actually knows are so owned shall be so disregarded.
SECTION 2.13. CUSIP Numbers. The Issuer in issuing the Notes may use
"CUSIP" numbers (if then generally in use), and, if so, the Indenture Trustee
shall indicate the "CUSIP" numbers of the Notes in notices of redemption and
related materials as a convenience to Noteholders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of redemption and
related materials.
SECTION 2.14. Perfection Representations and Warranties. The parties hereto
agree that the representations, warranties and covenants set forth in Schedule 1
shall be a part of this Indenture for all purposes.
SECTION 2.15. Notes to Constitute Indebtedness. The parties hereto agree
that it is their mutual intent that, for all applicable tax purposes, the Notes
will constitute indebtedness of the Issuer. Further, each party hereto and each
Noteholder (by accepting and holding a Note) hereby covenants to every other
party hereto and to every other Noteholder to treat the Notes as indebtedness
for all applicable tax purposes in all tax filings, reports and returns and
otherwise, and further covenants that neither it nor any of its Affiliates will
take, or participate in the taking of or permit to be taken, any action that is
inconsistent with the treatment of the Notes as indebtedness for tax purposes.
All successors and assignees of the parties hereto shall be bound by the
provisions hereof.
SECTION 2.16. Determination of LIBOR. LIBOR ("LIBOR") applicable to the
calculation of the Interest Rates for the Floating Rate Notes for any Interest
Accrual Period shall be determined on each LIBOR Rate Adjustment Date as
follows:
For any Interest Accrual Period, the rate, as obtained by the Indenture
Trustee, one-month United States dollar deposits which appears on the Reuters
Screen LIBOR01 as of 11:00 A.M., London, England time, on the second LIBOR
Business Day prior to the first day of such Interest Accrual Period (a "LIBOR
Rate Adjustment Date"). "Reuters Screen LIBOR01" means the display designated on
the Reuters 3000 Xtra (or such other page as may replace that page on that
service for the purpose of displaying London interbank offered rates of major
banks). With respect to a LIBOR Rate Adjustment Date on which no rate appears on
Telerate Page 3750, LIBOR for the applicable Interest Accrual Period will be the
rate calculated by the Indenture Trustee as the arithmetic mean of at least two
quotations obtained by the Indenture Trustee after requesting the principal
London offices of each of three major reference banks in the London interbank
market, which may include the Indenture Trustee and its affiliates, as selected
by the Indenture Trustee after consultation with the Issuer, to provide the
Indenture Trustee with its offered quotation for deposits in U.S. dollars for a
one-month period, commencing on the second LIBOR Business Day immediately prior
to the applicable Interest Accrual Period, to prime banks in the London
interbank market at approximately 11:00 a.m., London time, on such LIBOR Rate
Adjustment Date and in a principal amount approximately equal to the aggregate
outstanding principal balance of the Floating Rate Notes. If at least two such
quotations are provided,
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LIBOR determined on the applicable LIBOR Rate Adjustment Date will be the
arithmetic mean of the quotations. If fewer than two quotations referred to in
the preceding sentence above are provided, LIBOR determined on the applicable
LIBOR Rate Adjustment Date will be the rate calculated by the Indenture Trustee
as the arithmetic mean of the rates quoted at approximately 11:00 a.m. in New
York on the applicable LIBOR Rate Adjustment Date by one or more major banks in
New York City, selected by the Indenture Trustee after consultation with the
Issuer for loans in U.S. dollars to leading European banks, having a maturity of
one month, commencing on the second LIBOR Business Day prior to the applicable
Interest Accrual Period, and in a principal amount that is approximately equal
to the aggregate outstanding principal balance of the Floating Rate Notes. If
the banks so selected by the Indenture Trustee are not quoting as provided
above, LIBOR for the applicable LIBOR Rate Adjustment Date will be LIBOR in
effect on the preceding LIBOR Rate Adjustment Date.
The establishment of LIBOR by the Indenture Trustee on any LIBOR Rate
Adjustment Date and the Indenture Trustee's subsequent calculation of the Class
A-2b Interest Rate, the Class A-3b Interest Rate and the Class A-4b Interest
Rate applicable to the relevant Interest Accrual Period, in the absence of
manifest error, shall be final and binding.
Promptly following each LIBOR Rate Adjustment Date, the Indenture Trustee
shall supply the Issuer with the results of its determination of LIBOR on such
date.
ARTICLE III
COVENANTS
SECTION 3.1. Payments. The Issuer will duly and punctually pay the
principal of and interest, if any, on the Notes in accordance with the terms of
the Notes and this Indenture and shall not withdraw funds from the Note
Distribution Account except as set forth in Section 8.3. In addition, the Issuer
will duly and punctually pay to the Swap Counterparty, any Swap Payments
Outgoing and Swap Termination Payments when due in the priorities set forth in
Section 8.3 of this Indenture.
SECTION 3.2. Maintenance of Office or Agency. (a) The Issuer will maintain
at the Corporate Trust Office 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.
(b) The chief executive office of the Issuer at which the Issuer maintains
its records with respect to the Loans, its interests in the Equipment, and the
transactions contemplated hereby, is currently located in Danbury, Connecticut.
The Issuer will not change the location of such offices without giving the
Indenture Trustee at least 30 days prior written notice thereof.
SECTION 3.3. Paying Agent's Obligations. The Issuer will cause each Paying
Agent to comply with the obligations of the Paying Agent set forth in Section
6.16.
SECTION 3.4. Existence. (a) The Issuer will keep in full effect its
existence, rights and franchises as a limited liability company under the laws
of the jurisdiction of its organization.
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(b) The Issuer shall at all times observe and comply in all material
respects with (i) all laws applicable to it, and (ii) all requisite and
appropriate organizational and other formalities in the management of its
business and affairs and the conduct of the transactions contemplated hereby.
SECTION 3.5. Protection of the Collateral; Further Assurances. The Issuer
will from time to time execute and deliver and file, as applicable, all such
supplements and amendments hereto and all such writings of further assurance and
other writings, and will take such other action necessary or advisable to:
(i) more effectively Grant all or any portion of the Collateral;
(ii) maintain or preserve the Lien (and the same priority
thereof) of 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 and perfect the Lien
contemplated hereby in favor of the Indenture Trustee in all property
included in the Collateral;
(iv) enforce or cause the Servicer to enforce any of the
Collateral; or
(v) preserve and defend against the claims of all Persons and
parties, (a) title to the Collateral (including the right to receive
all payments due or to become due with respect to the Loans) and the
interests in the property included in the Collateral and (b) the
rights of the Indenture Trustee and the Noteholders with respect to
such Collateral (including the right to receive all payments due or to
become due with respect to the Loans) and interests with respect to
the property included in the Collateral.
SECTION 3.6. Opinions as to the Collateral. (a) On the Closing Date, the
Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either
stating that, in the opinion of such counsel, such action has been taken with
respect to the recording and filing of this Indenture, any indentures
supplemental hereto and any other requisite documents, and with respect to the
execution and filing of any financing statements and continuation statements, as
are necessary to perfect and make effective the Lien created by this Indenture
and reciting the details of such action, or stating that, in the opinion of such
counsel, no such action is necessary to make such Lien effective.
(b) On or before April 1 in each calendar year, the Issuer shall furnish to
the Indenture Trustee an Opinion of Counsel either stating that, in the opinion
of such counsel, such action has been taken with respect to the recording,
filing, re-recording and refiling of this Indenture, any indentures supplemental
hereto and any other requisite documents, and with respect to the execution and
filing of any financing statements and continuation statements, as is necessary
to maintain the Lien of this Indenture and reciting the details of such action,
or stating that in the opinion of such counsel no such action is necessary to
maintain such Lien. Such Opinion of Counsel shall also describe the recording,
filing, re-recording and refiling of this Indenture, any indentures supplemental
hereto and any other requisite documents, and the execution and filing of any
financing statements and continuation statements, that will, in the
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opinion of such counsel, be required to maintain the Lien of this Indenture
until April 1 in the following calendar year.
SECTION 3.7. Performance of Obligations; Servicing of Loans. (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 material covenants
or obligations under any instrument or agreement included in the Collateral or
that would result in the amendment, hypothecation, subordination, termination or
discharge of, or impair the validity or effectiveness of, any such instrument or
agreement, except as expressly provided in this Indenture, the Servicing
Agreement, Swap Agreement or such other instrument or agreement.
(b) The Issuer will punctually perform and observe all of its obligations
and agreements contained in this Indenture, the other Related Documents and in
the instruments and agreements included in the Collateral, including filing or
causing to be filed all UCC financing statements and continuation statements
required to be filed by this Indenture and the Servicing Agreement in accordance
with and within the time periods provided for herein and therein.
(c) The Issuer hereby covenants and agrees that it will enforce the
obligations of the Servicer under the Servicing Agreement and if a Servicer
Default shall arise from the failure of the Servicer to perform any of its
duties or obligations under the Servicing Agreement with respect to the Loans,
the Issuer shall take all reasonable steps available to it to remedy such
failure.
(d) The Issuer hereby covenants and agrees that: (i) it shall promptly
exercise its rights to terminate the Servicer pursuant to Section 5.1 of the
Servicing Agreement upon the occurrence of a Servicer Default set forth in
clause (a) of such section and (ii) prior to exercising its rights to terminate
the Servicer pursuant to Section 5.1 of the Servicing Agreement upon the
occurrence of a Servicer Default set forth in clause (b) of such section, obtain
the consent of the Noteholders representing a majority of the Outstanding
Principal Balance of the Notes. Within thirty (30) days after the giving of
notice of termination to the Servicer of the Servicer's rights and powers
pursuant to Section 6.2 of the Servicing Agreement, the Issuer shall appoint a
successor servicer (the "Successor Servicer"), such appointment to be reflected
by a written assumption in a form acceptable to the Indenture Trustee. In the
event that a Successor Servicer has not been appointed and accepted its
appointment at the time when the previous Servicer ceases to act as Servicer,
the Indenture Trustee without further action shall automatically be appointed
the Successor Servicer. The Indenture Trustee may resign as the Servicer by
giving written notice of such resignation to the Issuer and in such event will
be released from such duties and obligations, such release not to be effective
until the date a Successor Servicer enters into a servicing agreement with the
Issuer as provided below. Upon delivery of any such notice to the Issuer, the
Issuer shall obtain a new servicer as the Successor Servicer under the Servicing
Agreement. Any Successor Servicer other than the Indenture Trustee shall: (i) be
an established financial institution having a net worth of not less than
$50,000,000 and whose regular business includes the servicing of receivables and
(ii) enter into a servicing agreement with the Issuer having substantially the
same provisions as the provisions of the Servicing Agreement applicable to the
Servicer. If the Indenture Trustee shall succeed to the previous Servicer's
duties as servicer of the Loans as provided herein, it shall do so in its
individual capacity and not in its capacity as Indenture Trustee and,
accordingly, the provisions of Article VI shall be inapplicable
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to the Indenture Trustee in its duties as the Successor Servicer and the
servicing of the Loans. In case the Indenture Trustee shall become the Successor
Servicer under the Servicing Agreement, the Indenture Trustee shall be entitled
to appoint as Servicer any one of its Affiliates; provided, that it shall be
fully liable for the actions and omissions of such Affiliate in its capacity as
Successor Servicer.
(e) Upon any termination of the Servicer's rights and powers pursuant to
the Servicing Agreement, the Issuer shall promptly notify the Indenture Trustee,
▇▇▇▇▇'▇ and S&P. As soon as a Successor Servicer is appointed, the Issuer shall
notify the Indenture Trustee of such appointment, specifying in such notice the
name and address of such Successor Servicer.
(f) The Issuer agrees that it will not, without the prior written consent
of the Indenture Trustee or the Noteholders of at least a majority of the
Outstanding Principal Balance, amend, modify, waive, supplement, terminate or
surrender, or agree to any amendment, modification, supplement, termination,
waiver or surrender of, the terms of any Collateral (except to the extent
otherwise in accordance with the Credit and Collection Policies) or the Related
Documents, or waive timely performance or observance by the Purchaser under the
Purchase and Sale Agreement, the applicable Seller under the Sale Agreement or
the Servicer under the Servicing Agreement; provided, that, no such amendment or
waiver shall: (i) increase or reduce in any manner the amount of, or accelerate
or delay the timing of, deposits required to be made to the Trust Accounts and
payments that are required to be made from the Trust Accounts for the benefit of
the Noteholders, or (ii) reduce the aforesaid percentage of the Notes that are
required to consent to any such amendment, in either case without the consent of
the Noteholders of all the Outstanding Notes. If any such amendment,
modification, supplement or waiver shall be so consented to by the Indenture
Trustee or such Noteholders, the Issuer agrees, promptly following a request by
the Indenture Trustee to do so, to execute and deliver, in its own name and at
its own expense, such agreements, instruments, consents and other documents as
the Indenture Trustee may deem necessary or appropriate in the circumstances.
(g) Promptly following a request from the Indenture Trustee to do so and at
the Issuer's expense, the Issuer shall take all such lawful action as the
Indenture Trustee may request to compel or secure the performance and observance
by the Servicer of its obligations to the Issuer under or in connection with the
Servicing Agreement or by the Purchaser of its obligations to the Issuer under
or in connection with the Purchase and Sale 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
Servicing Agreement (or under or in connection with the Purchase and Sale
Agreement) to the extent and in the manner directed by the Indenture Trustee,
including the transmission of notices of default on the part of the Servicer or
the Purchaser thereunder and the institution of legal or administrative actions
or proceedings to compel or secure performance by the Servicer or the Purchaser
of each of their obligations under the Servicing Agreement or the Purchase and
Sale Agreement.
SECTION 3.8. Taxes. The Issuer shall pay all taxes when due and payable or
levied against its assets, properties or income, including any property that is
part of the Collateral.
SECTION 3.9. Annual Statement as to Compliance. The Issuer will deliver to
the Indenture Trustee, on or before the 90th day after the end of each calendar
year of the Issuer
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(commencing with the calendar year 2007), an Officers' Certificate,
substantially in the form of Exhibit B, stating that:
(i) a review of the activities of the Issuer during such year and
of performance under this Indenture has been made under such
Authorized Officers' supervision; and
(ii) to the best of such Authorized Officers' 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 Officers and the
nature and status thereof.
SECTION 3.10. Information to Be Provided by the Indenture Trustee.
(a) It is agreed and acknowledged that the purpose of this Section 3.10 is
to facilitate compliance by the Purchaser and the Issuer with the provisions of
Regulation AB and related rules and regulations of the Commission. Neither the
Purchaser nor the Issuer shall exercise its right to request delivery of
information or other performance under this Section 3.10 other than in good
faith, or for purposes other than the Issuer's or the Purchaser's compliance
with the Securities Act, the Securities Exchange Act and the rules and
regulations of the Commission thereunder (or to provide disclosure related to a
private offering comparable to that required under the Securities Act). The
Indenture Trustee agrees to cooperate in good faith with any reasonable request
by the Purchaser or the Issuer for information regarding the Indenture Trustee,
including but not limited to, information which is required in order to enable
the Purchaser and the Issuer to comply with Items 1109(a), 1109(b), 1117, 1118,
1119 and 1122 of Regulation AB as it relates to the Indenture Trustee or to the
Indenture Trustee's obligations under this Indenture.
(b) The Indenture Trustee shall be deemed to represent to the Purchaser and
the Issuer, as of the date on which information is provided to Purchaser
pursuant to this Section 3.10, except as disclosed in writing to the Purchaser
prior to such date that: (i) none of the execution or the delivery by the
Indenture Trustee of this Indenture, the performance by the Indenture Trustee of
its obligations under this Indenture nor the consummation of any of the
transactions by the Indenture Trustee contemplated hereby, cause the Indenture
Trustee to be in violation of (x) any indenture, mortgage, bank credit
agreement, note or bond purchase agreement, long-term lease, license or other
agreement or instrument to which the Indenture Trustee is a party or by which it
is bound, which violation would have a material adverse effect on the Indenture
Trustee's ability to perform its obligations under this Indenture, or (y) of any
judgment or order applicable to the Indenture Trustee; and (ii) there are no
proceedings pending or threatened against the Indenture Trustee in any court or
before any governmental authority, agency or arbitration board or tribunal
which, individually or in the aggregate, would have a material adverse effect on
the Noteholders or the right, power and authority of the Indenture Trustee to
enter into this Indenture or to perform its obligations under this Indenture.
(c) For so long as the Issuer is required to report under the Securities
Exchange Act, the Indenture Trustee shall: (i) on or before the fifth Business
Day of each month, provide to the
34
Issuer, in writing, such information regarding the Indenture Trustee as is
requested in writing by the Issuer for the purpose of compliance with Item 1117
of Regulation AB; provided, however, that the Indenture Trustee shall not be
required to provide such information in the event that there has been no change
to the information previously provided by the Indenture Trustee to the Issuer,
and (ii) as promptly as practicable following actual notice to or discovery by a
Responsible Officer of the Indenture Trustee of any changes to such information,
provide to the Purchaser, in writing, such updated information.
(d) As soon as available but no later than March 15 of each calendar year
for so long as the Issuer is required to report under the Securities Exchange
Act, commencing in 2008, the Indenture Trustee shall (if requested in writing by
the Purchaser in order to comply with Item 1122 of Regulation AB) deliver to the
Purchaser reports regarding the assessment by the Indenture Trustee (if so
requested by the Purchaser) of compliance to the Servicing Criteria during the
immediately preceding calendar year, as required under paragraph (b) of Rule
13a-18 and Rule 15d-18 of the Securities Exchange Act and Item 1122 of
Regulation AB. Such reports shall be signed by an Authorized Officer of the
Indenture Trustee and shall address each of the servicing criteria specified in
Exhibit C or such criteria as mutually agreed upon by the Purchaser and the
Indenture Trustee.
(e) As soon as available but no later than March 15 of each calendar year
for so long as the Issuer is required to report under the Securities Exchange
Act, commencing in 2008, the Indenture Trustee shall (if requested in writing by
the Purchaser in order to comply with Item 1122 of Regulation AB) deliver to the
Purchaser a report of a registered public accounting firm that attests to, and
reports on, the assessment of compliance made by the Indenture Trustee and
delivered pursuant to the preceding paragraph. Such attestation shall be made in
accordance with standards for attestation engagements issued or adopted by the
Public Company Accounting Oversight Board and in accordance with Rules
1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act and the
Securities Exchange Act.
(f) As soon as available but no later than March 15 of each calendar year
for so long as the Issuer is required to report under the Securities Exchange
Act, commencing in 2008, the Indenture Trustee shall (if requested in writing by
the Purchaser in order to comply with Item 1122 of Regulation AB) deliver to the
Purchaser and any other Person that will be responsible for signing the
certification required by Rules 13a-14(d) and 15d-14(d) under the Securities
Exchange Act (pursuant to Section 302 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002) (a
"Sarbanes Certification") on behalf of the Issuer or the Purchaser a
certification substantially in the form attached hereto as Exhibit D or such
form as mutually agreed upon by the Purchaser and the Indenture Trustee. The
Indenture Trustee acknowledges that the parties identified in this Section
3.10(f) may rely on the certification provided by the Indenture Trustee
hereunder in signing a Sarbanes Certification and filing such with the
Commission.
SECTION 3.11. Negative Covenants. So long as any Notes are Outstanding, the
Issuer shall not:
(a) sell, transfer, exchange or otherwise dispose of any of the properties
or assets of the Issuer, including those included in the Collateral, except as
expressly permitted by this Indenture or Section 6.2 of the Sale Agreement;
35
(b) 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 Collateral;
(c) engage in any business or activity other than in connection with, or
relating to the financing, purchasing, owning, selling and managing ownership
of, the Loans and the interests in the property constituting the Collateral, the
issuance of the Notes, and the specific transactions contemplated by the Related
Documents and activities incidental thereto;
(d) issue, incur, assume, or allow to remain outstanding any indebtedness,
or guaranty any indebtedness or otherwise become liable, directly or indirectly
for any Indebtedness of any Person, other than the Notes or Swap Agreement,
except as contemplated by this Indenture and the other Related Documents;
(e) seek dissolution or liquidation in whole or in part or reorganization
of its business or affairs;
(f) (A) permit the validity or effectiveness of this Indenture to be
impaired, or permit the Lien of 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 (other than the
Lien of this Indenture) to be created on or extend to or otherwise arise upon or
burden the Collateral or any part thereof or any interest therein or the
proceeds thereof or (C) permit the Lien of this Indenture not to constitute a
valid first priority (other than with respect to any tax lien, mechanics' lien
or other lien not considered a Lien) "security interest" (as such term is
defined in Section 1-201 of Article 1 of the UCC) in the Collateral;
(g) make any loan or advance to any Affiliate of the Issuer or to any other
Person;
(h) make any expenditure (by long-term or operating lease or otherwise) for
capital assets (either realty or personalty);
(i) remove the Managing Member without cause unless the Rating Agency
Condition shall have been satisfied in connection with such removal;
(j) 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, with respect to any ownership or equity interest or
security in or of the Issuer, (ii) redeem, purchase, retire or otherwise acquire
for value any such ownership or equity interest or security, (iii) set aside or
otherwise segregate any amounts for any such purpose or (iv) make payments to or
distributions from the Collection Account, in each case, except in accordance
with this Indenture and the Related Documents;
(k) convey or transfer any of its properties or assets, including those
included in the Collateral, to any Person, unless (i) the Person that acquires
such property or assets shall: (A) 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 and
36
(B) 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 Securities
Exchange Act in connection with the Notes and (ii) the conditions in clause (l)
below have been satisfied; and
(l) consolidate or merge with or into any other Person or convey or
transfer any of its properties or assets, including those included in the
Collateral, to any Person unless:
(i) such Person shall be a United States citizen or a Person
organized and existing under the laws of the United States of America
or any State,
(ii) such Person shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Indenture Trustee,
in form satisfactory to the Indenture Trustee, the due and punctual
payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed, all
as provided herein,
(iii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iv) the Rating Agency Condition shall have been satisfied with
respect to such transaction;
(v) the Issuer shall have received an Opinion of Counsel (and
shall have delivered copies thereof to the Indenture Trustee) to the
effect that such transaction will not have any material adverse tax
consequence to the Issuer or any Noteholder;
(vi) any action that is necessary to maintain the Lien created by
this Indenture and the same priority thereof shall have been taken;
and
(vii) the Issuer shall have delivered to the Indenture Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
consolidation or merger or such conveyance or transfer, as the case
may be, and such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such
transaction have been complied with (including any filing required by
the Securities Exchange Act).
SECTION 3.12. Successor or Transferee. (a) Upon any consolidation or merger
of the Issuer in accordance with Section 3.11(l), 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 and have
every obligation of, the Issuer under this Indenture with the same effect as if
such Person had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties of the
Issuer pursuant to Section 3.11(k), 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
37
immediately upon the delivery of written notice to the Indenture Trustee stating
that the Issuer is to be so released.
SECTION 3.13. Notice of Events of Default. (a) The Issuer shall give the
Indenture Trustee and the Rating Agencies prompt written notice of each Event of
Default hereunder, each default on the part of the Servicer of its obligations
under the Servicing Agreement (and, in the case of a Servicer Default, shall
specify in such notice the action, if any, the Issuer is taking with respect to
such default) each default on the part of the Purchaser of its obligations under
the Purchase and Sale Agreement and the occurrence of each Swap Event of Default
and Swap Termination Event.
(b) The Issuer shall deliver to the Indenture Trustee, within five days
after the Issuer obtains actual knowledge thereof, written notice in the form of
an Officers' Certificate of any event that, with the giving of notice or the
lapse of time or both, would become an Event of Default under clause (iii) of
the definition thereof, its status and what action the Issuer is taking or
proposes to take with respect thereto.
SECTION 3.14. Further Instruments and Acts. Upon request of the Indenture
Trustee, the Issuer will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1. Satisfaction and Discharge of Indenture. (a) This Indenture
shall cease to be of further effect 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) Section 3.2, (v) the rights, obligations and immunities
of the Indenture Trustee hereunder (including the rights of the Indenture
Trustee under Section 6.7) and the obligations of the Indenture Trustee under
Sections 4.2 and 6.4) and (vi) the rights of Noteholders and Swap Counterparty
as beneficiary hereof with respect to the property so deposited with the
Indenture Trustee payable to all or any of them, and the Indenture Trustee, on
demand of and at the expense of the Issuer, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to the
Notes, when (A) all Notes theretofore authenticated and delivered to Noteholders
(other than (x) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.5 and (y) Notes in respect of
which funds have theretofore been deposited in trust or segregated and held in
trust by the Issuer as provided in Section 6.16(i)) have been delivered to the
Indenture Trustee for cancellation and (B) the Issuer has paid or caused to be
paid or provided for (to the satisfaction of the Person entitled thereto) all
other sums due and payable with respect to the Swap Agreement; provided that the
Issuer has delivered to the Indenture Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have been
complied with.
(b) Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Issuer to the Indenture Trustee under Section 6.7, and if
funds shall have been deposited
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with the Indenture Trustee pursuant to Section 4.1(a)(A)(y), the obligations of
the Indenture Trustee under Sections 4.2 and 6.17 (in its capacity as Paying
Agent) shall survive.
(c) The Indenture Trustee shall provide prompt written notice to each
Rating Agency of any satisfaction and discharge of this Indenture pursuant to
this Article IV.
SECTION 4.2. Application of Trust Funds. All funds deposited with the
Indenture Trustee pursuant to Section 4.1 shall be held in trust and (a) 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 Noteholders of the particular Notes for the payment or
redemption of which such funds have been deposited with the Indenture Trustee,
of all sums due and to become due thereon for principal and interest or (b)
applied by it in accordance with the provisions of this Indenture to the
payment, either directly or through any Paying Agent, as the Indenture Trustee
may determine, to the Swap Counterparty any Swap Payments Outgoing or Swap
Termination Payments due; but such funds need not be segregated from other funds
except to the extent required herein or as required by law.
ARTICLE V
REMEDIES
SECTION 5.1. Events of Default. "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;
(ii) default in the payment of the principal of any Note at the
Maturity Date;
(iii) 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), or any
representation or warranty of the Issuer made in this Indenture or in
any certificate or other writing delivered pursuant hereto or in
connection herewith proving to have been incorrect in any material
respect as of the time when the same shall have been made, and such
default shall continue or not be cured, or the circumstance or
condition in respect of which such misrepresentation or warranty was
incorrect shall not have been eliminated or otherwise cured, for a
period of 30 days (or for such longer period, not in excess of 90
days, as may be reasonably necessary to remedy such default if the
Issuer delivers an Officer's Certificate to the Indenture Trustee to
the effect that the Issuer has commenced, or will promptly commence
and diligently pursue, all reasonable efforts to remedy such default
and such default can be remedied in
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90 days or less) after there shall have been given, by registered or
certified mail, to the Issuer by the Indenture Trustee or to the
Issuer and the Indenture Trustee by the Noteholders of at least 25% of
the Outstanding Principal Balance of the Notes, a written notice
specifying such default or incorrect representation or warranty and
requiring it to be remedied and stating that such notice is a notice
of Default hereunder; or
(iv) any Insolvency Event shall occur with respect to the Issuer.
SECTION 5.2. Remedies. (a) If an Event of Default should occur and be
continuing, the Indenture Trustee may, and, at the direction (which direction
shall be in writing) of the Noteholders, pursuant to Section 5.8 or, in the case
of clause (viii) below, at the direction (which direction shall be in writing)
of not less than 66-2/3% of the Outstanding Principal Balance of the Notes, the
Indenture Trustee shall (subject to Section 6.2(a)(v)), do one or more of the
following:
(i) declare all the Notes to be immediately due and payable, by a
notice in writing to the Issuer, and upon any such declaration the
Outstanding Principal Balance, together with accrued and unpaid
interest thereon through the date of acceleration, shall become
immediately due and payable;
(ii) in the case of an Event of Default described in Section
5.1(i) or (ii), demand the Issuer to pay to the Indenture Trustee, for
the benefit of the Noteholders, the whole amount then due and payable
on the Notes for principal and interest, with interest upon the
overdue principal at the applicable interest rate, and, to the extent
payment at such rate of interest shall be legally enforceable, upon
overdue installments of interest, at the applicable interest rate, and
in addition thereto such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel;
(iii) institute Proceedings in its own name and as trustee of an
express trust for the collection of all amounts then payable on the
Notes or under this Indenture with respect thereto, whether by
declaration or otherwise, enforce any judgment obtained, and collect
from the Issuer amounts adjudged due;
(iv) institute Proceedings from time to time for the complete or
partial foreclosure of this Indenture with respect to the Collateral;
(v) exercise any remedies of a secured party under the UCC as in
effect in the State of New York and take any other appropriate action
to protect and enforce the rights and remedies of the Indenture
Trustee, the Swap Counterparty and the Noteholders;
(vi) subject to Section 5.14, sell the Collateral, or any portion
thereof or rights or interest therein, at one or more public or
private sales called and conducted in any manner permitted by law;
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(vii) make demand upon the Issuer, by written notice, that the
Issuer deliver to the Indenture Trustee all Loan Files (in which event
the Issuer covenants to make demand upon the Servicer to so deliver
such Loan Files); and
(viii) exercise all rights, remedies, powers, privileges and
claims of the Issuer against the Servicer or the Purchaser under or in
connection with the Servicing Agreement and the Purchase and Sale
Agreement, including the right or power to terminate or to take any
action to compel or secure performance or observance by the Servicer
or the Purchaser of each of their obligations to the Issuer thereunder
and to give any consent, request, notice, direction, approval,
extension or waiver under the Servicing Agreement or the Purchase and
Sale Agreement, and any right of the Issuer to take such action shall
be suspended.
(b) At any time after a declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the amount due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Noteholders of Notes representing not less than a majority of the Outstanding
Principal Balance, by written notice to the Issuer and the Indenture Trustee,
may rescind and annul such declaration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture Trustee a
sum sufficient to pay:
(A) all payments of principal of and interest on all Notes
including any payments payable to the Swap Counterparty under the Swap
Agreement and all other amounts that would then be due hereunder or
upon such Notes if the Event of Default giving rise to such
acceleration had not occurred; and
(B) all sums paid or advanced by the Indenture Trustee hereunder
and the reasonable compensation, expenses, disbursements and advances
of the Indenture Trustee and its agents and counsel; and
(ii) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such
acceleration, have been cured or waived as provided in Section 5.9.
No such rescission shall affect any subsequent Event of Default or impair
any right consequent thereto.
(c) In case there shall be pending, relative to the Issuer or any Person
having or claiming an ownership interest in the Collateral, Proceedings under
Title 11 of the United States Code or any other applicable Federal or State
bankruptcy, insolvency or other similar law, or in case a receiver, assignee,
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 Person, or in case of any other comparable judicial
Proceedings relative to the Issuer, or to the creditors or property of the
Issuer, 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 this Section) shall be entitled and empowered to, and, at the
direction (which
41
direction shall be in writing) of the Noteholders pursuant to Section 5.8 by
intervention in such proceedings or otherwise:
(i) file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to
file such other papers or documents as may be necessary or advisable
in order to have the claims of the Indenture Trustee (including any
claim for reasonable compensation to the Indenture Trustee and each
predecessor Indenture Trustee, and their respective agents, attorneys
and counsel, and for reimbursement of all expenses and liabilities
incurred, and all advances made, 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 or regulations, vote on
behalf of the Noteholders in any election of a trustee, a standby
trustee or any Person performing similar functions in any such
Proceedings;
(iii) collect and receive any amounts or other property payable
or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders, the Swap
Counterparty and of the Indenture Trustee on their behalf; and
(iv) file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Swap
Counterparty, Indenture Trustee or the Noteholders allowed in any
judicial Proceedings relative to the Issuer, its creditors and its
property;
and any trustee, receiver, liquidator, assignee, custodian, sequestrator or
other similar official in any such Proceeding is hereby authorized by each of
such Noteholders or the Swap Counterparty 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 or the Swap Counterparty, 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, and all advances made, 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 Noteholder 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 or the Swap Agreement, 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
42
thereto, and any such action or Proceedings instituted by the Indenture Trustee
shall be brought in its own name and 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 benefit of the
Noteholders and the Swap Counterparty as provided in this Indenture.
(f) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Noteholders and the Swap Counterparty, and it shall
not be necessary to make any Noteholder or the Swap Counterparty a party to any
such Proceedings.
SECTION 5.3. [Reserved].
SECTION 5.4. Unconditional Rights of Noteholders To Receive Principal and
Interest. Notwithstanding any other provisions in this Indenture, each
Noteholder shall have the right, which is absolute and unconditional, to receive
payment of the principal of and interest, if any, on such Note on or after the
respective due dates thereof expressed in such Note or in this Indenture (or, 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 Noteholder.
SECTION 5.5. Restoration of Rights and Remedies. If the Indenture Trustee
or any Noteholder has instituted any Proceeding to enforce any right or remedy
under this Indenture and such Proceeding has been discontinued or abandoned for
any reason or has been determined adversely to the Indenture Trustee or to such
Noteholder, then and in every such case the Issuer, the Indenture Trustee and
the Noteholders shall, subject to any determination in such Proceeding, be
restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Indenture Trustee and the Noteholders
shall continue as though no such Proceeding had been instituted.
SECTION 5.6. Rights and Remedies Cumulative. Except as otherwise provided
with respect to the replacement or payment of mutilated, destroyed, lost, or
stolen Notes in Section 2.5(d), no right or remedy herein conferred upon or
reserved to the Indenture Trustee 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 5.7. Delay or Omission Not a Waiver. No delay or omission of the
Indenture Trustee or any Noteholder to exercise any right or remedy accruing
upon any Default or Event of Default shall impair any such right or remedy or
constitute a waiver of any such Default or Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Indenture
Trustee or to the Noteholders may be exercised from time to time, and as often
as may be deemed expedient, by the Indenture Trustee or by the Noteholders, as
the case may be.
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SECTION 5.8. Control by Noteholders. (a) Except as otherwise expressly
provided in this Indenture, the Noteholders of not less than a majority of the
Outstanding Principal Balance of the Notes shall have the right to (i) direct
the time, method and place of conducting any Proceeding for any remedy available
to the Indenture Trustee with respect to the Notes, (ii) accelerate the Notes
pursuant to Section 5.2 after an Event of Default or (iii) exercise any trust or
power conferred on the Indenture Trustee; provided, that such direction shall
not be in conflict with any rule of law or with this Indenture; provided,
further, that, subject to Section 6.1, the Indenture Trustee need not take any
action that it determines might involve it in liability on the part of the
Indenture Trustee for which the Indenture Trustee is not indemnified to its
satisfaction or might materially adversely affect the rights of any
Noteholder(s) not consenting to such action. The Indenture Trustee may take any
other action deemed proper by the Indenture Trustee that is not inconsistent
with such direction.
(b) No Noteholder shall have any right to institute any Proceeding, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless:
(i) such Noteholder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(ii) the Noteholder(s) of not less than 66-2/3% of the
Outstanding Principal Balance of the Notes have made written request
to the Indenture Trustee to institute such Proceeding in respect of
such Event of Default in its own name as Indenture Trustee hereunder;
(iii) such Noteholder(s) have offered to the Indenture Trustee
indemnity reasonably acceptable to the Indenture Trustee 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 has failed to institute such
Proceeding;
(v) so long as any of the Notes remain Outstanding, no direction
by other Noteholders inconsistent with such written request has been
given to the Indenture Trustee during such 60-day period by the
Noteholders of 66-2/3% of the Outstanding Principal Balance of the
Notes;
(vi) with respect to any bankruptcy reorganization, arrangement,
insolvency or liquidation proceedings, or similar proceedings under
any United States Federal or State bankruptcy or similar law, the
Noteholders representing not less than 66-2/3% of the Outstanding
Principal Balance of each Class of Notes that remains Outstanding has
consented thereto in writing; provided, that the foregoing shall not
in any way limit the Noteholder's rights to pursue any other creditor
rights or remedies that the Noteholders may have for claims against
the Issuer,
it being understood and intended that no one or more Noteholder(s) shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb
44
or prejudice the rights of any other Noteholder or to obtain or to seek to
obtain priority or preference over any other Noteholder(s) or to enforce any
right under this Indenture, except in the manner herein provided and for the
equal and ratable benefit of all the other Noteholders. Nothing in this Section
shall be construed as limiting the rights of otherwise qualified Noteholders to
petition a court for the removal of an Indenture Trustee pursuant to Section 6.8
hereof.
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 Outstanding Principal Balance of the
Notes, the Indenture Trustee in its sole discretion may determine what action,
if any, shall be taken, notwithstanding any other provisions of this Indenture.
SECTION 5.9. Waiver of Past Defaults. Prior to the time a judgment or
decree for payment of amounts due has been obtained as described in Section 5.2,
the Noteholders of not less than a majority of the Outstanding Principal Balance
of the Notes may waive any past Default or Event of Default and its consequences
except a Default: (a) in 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 each Noteholder. In the case of any such waiver,
the Issuer, the Indenture Trustee and the Noteholders shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other Default or Event of Default or impair any
right consequent thereto.
Upon any such waiver, such Default 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 impair any right consequent thereto.
SECTION 5.10. Undertaking for Costs. All parties to this Indenture agree
(and each Noteholder by such Noteholder's acceptance thereof shall be deemed to
have agreed) that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorney's fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to: (a) any suit instituted by the
Indenture Trustee, (b) any suit instituted by any Noteholder(s) holding in the
aggregate more than 10% of the Outstanding Principal Balance of the Notes or (c)
any suit instituted by any Noteholder for the enforcement of the payment of
principal of or interest on any Note on or after the respective due dates
expressed in such Note and in this Indenture (or, in the case of redemption, on
or after the Redemption Date).
SECTION 5.11. Waiver of Stay or Extension Laws. The Issuer covenants (to
the extent that it may lawfully do so) that it will not at any time insist upon,
or plead or in any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance
45
of this Indenture; and the Issuer (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage 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 5.12. 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 Collateral or upon any of
the assets of the Issuer. Any funds or other property collected by the Indenture
Trustee shall be applied in accordance with Section 8.3(c).
SECTION 5.13. [Reserved]
SECTION 5.14. Sale of Collateral. (a) The power to effect any sale of any
portion of the Collateral described pursuant to Section 5.2 shall not be
exhausted by any one or more sales as to any portion of the Collateral remaining
unsold, but shall continue unimpaired until the entire Collateral shall have
been sold or all amounts due under this Indenture have been paid in full. The
Indenture Trustee may from time to time, upon directions in accordance with
Section 5.8, postpone any public sale by public announcement made at the time
and place of such sale. For any public sale of the Collateral, the Indenture
Trustee shall have provided each Noteholder and Moody's with notice of such sale
at least two weeks in advance of such sale which notice shall specify the date,
time and location of such sale.
(b) To the extent permitted by applicable law, the Indenture Trustee shall
not in any private sell to a third party the Collateral, or any portion thereof
unless,
(i) the holders of not less than 66-2/3% of the then Outstanding
Principal Balance of the Notes consent to or direct the Indenture
Trustee in writing to make such sale; or
(ii) the proceeds of such sale would be not less than the sum of
all amounts due under this Indenture.
(c) In connection with a sale of all or any portion of the Collateral:
(i) any one or more Noteholders may bid for and purchase the
property offered for sale, and upon compliance with the terms of sale
may hold, retain, and possess and dispose of such property, without
further accountability, and any Noteholder may, in paying the purchase
price therefore, deliver in lieu of cash any Outstanding Notes or
claims for interest thereon for credit in the amount that shall, upon
distribution of the net proceeds of such sale, be payable thereon, and
the Notes, in case the amounts so payable thereon shall be less than
the amount due thereon, shall be returned to the Noteholders after
being appropriately stamped to show such partial payment;
46
(ii) the Indenture Trustee is hereby irrevocably appointed the
agent and attorney-in-fact of the Issuer to transfer and convey any
portion of the Collateral in connection with a sale thereof, and to
take all action necessary to effect such sale;
(iii) the Indenture Trustee shall execute and deliver an
appropriate instrument of conveyance transferring, without
representation, warranty or recourse, any portion of the Collateral in
connection with a sale thereof;
(iv) no purchaser or transferee at such a sale 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 funds; and
(v) the Indenture Trustee may not sell or otherwise liquidate the
Collateral following an Event of Default, other than an Event of
Default described in Sections 5.1(i) or (ii), unless the applicable
conditions in this Section 5.14 are met and: (A) all the Noteholders
direct in writing a sale or liquidation of the Collateral, (B)(i) the
Indenture Trustee determines, based on a certification of the Issuer,
that the anticipated proceeds of such sale or liquidation (after
deducting the reasonable expenses of such sale or liquidation), based
on a certificate of the Issuer, would be sufficient to discharge in
full all amounts due and unpaid upon such Notes and other amounts
payable pursuant to Sections 8.3(c) and (ii) the Noteholders acting
unanimously do not direct in writing the Indenture Trustee to the
contrary within fifteen days of receipt of notice of such
determination by the Indenture Trustee or (C) the Indenture Trustee
determines that the Collateral will not continue to provide sufficient
funds for the payment of principal of and interest on the Notes as
they would have become due if the Notes had not been declared due and
payable, and the Indenture Trustee obtains the consent of Noteholders
of 66-2/3% of the Outstanding Principal Balance of the Notes. In
determining whether to sell or hold the Collateral, the Indenture
Trustee may obtain and rely upon an opinion of any Independent
investment banking or accounting firm of national reputation in the
United States as to the feasibility of such proposed action and as to
the sufficiency of the Collateral to discharge in full all amounts
then due and unpaid upon the Notes for principal and interest.
(d) The method, manner, time, place and terms of any sale of all or any
portion of the Collateral shall be commercially reasonable.
(e) The provisions of this Section shall not be construed to restrict the
ability of the Indenture Trustee to exercise any rights and powers against the
Issuer or the Collateral that are vested in the Indenture Trustee by this
Indenture, including, without limitation, the power of the Indenture Trustee to
proceed against the collateral subject to the lien of this Indenture and to
institute judicial proceedings for the collection of any deficiency remaining
thereafter.
(f) The purchase price received by the Indenture Trustee in respect of any
sale made in accordance with this Section shall be deemed conclusive and binding
on the parties hereto and the Noteholders and the proceeds of such sale shall be
applied in accordance with Section 8.3(c).
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ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1. Duties of the Indenture Trustee. (a) If an Event of Default of
which a Responsible Officer of the Indenture Trustee has actual knowledge has
occurred and is continuing, the Indenture Trustee shall exercise the rights and
powers vested in it by this Indenture and use the same degree of care and skill
in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default actually known to
a Responsible Officer:
(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; provided, however, in the case of any
such certificates or opinions that by any provision hereof are
specifically required to be furnished to the Indenture Trustee, the
Indenture Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) No provision of this Indenture shall be construed to relieve the
Indenture Trustee from liability for its own grossly negligent action, its own
grossly negligent failure to act, or its own willful misconduct, except that:
(i) this clause (c) does not limit the effect of clause (b) of
this Section;
(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;
(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 this Indenture;
(iv) the Indenture Trustee shall not be charged with knowledge of
an Event of Default or Servicer Default unless a Responsible Officer
obtains actual knowledge of such event or the Indenture Trustee
receives written notice of such event from the Issuer or Note Owners
owning Notes aggregating not less than 10% of the Outstanding
Principal Balance of the Notes; and
(v) the Indenture Trustee shall have no duty to monitor the
performance of the Issuer or its agents, nor shall it have any
liability in connection with malfeasance or nonfeasance by the Issuer.
The Indenture Trustee shall have
48
no liability in connection with compliance of the Issuer or its agents
with statutory or regulatory requirements related to the Loans. The
Indenture Trustee shall not make or be deemed to have made any
representations or warranties with respect to the Loans or the
validity or sufficiency of any assignment of the Loans to the
Collateral or the Indenture Trustee.
(d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to clauses (a), (b), (c) and (g) of this Section
6.1.
(e) The Indenture Trustee shall not be liable for interest on any amounts
received by it except as the Indenture Trustee may agree in writing with the
Issuer.
(f) 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 satisfactory to it against any loss,
liability or expense is not reasonably assured to it.
(g) Whether or not therein expressly so provided, 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 this Section and the
TIA.
(h) The Indenture Trustee:
(i) shall at all times be a "participant" (as such term is
defined in the Federal Book-Entry Regulations) in the Federal Reserve
System;
(ii) shall, to the extent that any of the Trust Accounts is a
Securities Account, comply with all of the obligations of a Securities
Intermediary under Article 8 of the UCC with respect thereto; and
(iii) agrees that each item of property including cash received
by it for deposit in or credit to a Trust Account, and each investment
made by it pursuant to Section 8.6 shall constitute and be treated by
it as a Financial Asset.
(i) No person other than the Indenture Trustee as provided herein shall
have "control" (as such term is defined in Section 8-106 of Article 8 of the UCC
and Section 9-401 of Article 9 of the UCC) of any of the Trust Accounts.
SECTION 6.2. Rights of Indenture Trustee. (a) Subject to the provisions of
Section 6.1:
(i) the Indenture Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, note, debenture, other
evidence of indebtedness or other paper or document believed by it to
be genuine and to have been signed or presented by the proper party or
parties (and the Indenture Trustee need not investigate any fact or
matter stated in the document);
49
(ii) any request or direction or action of the Issuer mentioned
herein shall be sufficiently evidenced by an Issuer Order;
(iii) whenever in the administration of this Indenture the
Indenture Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action
hereunder, the Indenture Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part,
conclusively rely upon an Officers' Certificate;
(iv) the Indenture Trustee may consult with counsel as to legal
matters and the advice or opinion of any such counsel selected by the
Indenture Trustee with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(v) the Indenture Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Indenture at
the request or direction of any of the Noteholders pursuant to this
Indenture, unless such Noteholders shall have offered to the Trustee
security or indemnity satisfactory to it against the costs, expenses
and liabilities which might be incurred by it in compliance with such
request or direction;
(vi) 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,
direction, consent, order, note, debenture, other evidence of
indebtedness, or other paper or document, but the Indenture Trustee,
in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Indenture Trustee
shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the
Issuer, personally or by agent or attorney;
(vii) the Indenture Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents, attorneys, custodians or nominees and the Indenture
Trustee shall not be responsible for any misconduct or negligence on
the part of any agent, attorney, custodian or nominee appointed with
due care by it hereunder;
(viii) 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;
(ix) the Indenture Trustee shall not be required to give any bond
or surety in respect of the performance of its powers and duties
hereunder;
(x) the Indenture Trustee shall not be bound to ascertain or
inquire as to the performance or observance of any covenants,
conditions or agreements on the part of the Issuer;
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(xi) the permissive rights of the Indenture Trustee to do things
enumerated in this Indenture shall not be construed as a duty and the
Indenture Trustee shall not be answerable for other than its gross
negligence or willful default;
(xii) in the event that the Indenture Trustee is also acting as
Paying Agent or Note Registrar hereunder, the rights and protections
afforded to the Indenture Trustee pursuant to this Article VI shall
also be afforded to such Paying Agent or Note Registrar; and
(xiii) in no event shall the Indenture Trustee be liable for
special, indirect or consequential damages.
(b) The recitals contained herein and in the Notes, except the Indenture
Trustee's certificates of authentication, shall be taken as the statements of
the Issuer, and the Indenture Trustee assumes no responsibility for their
correctness. The Indenture Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Notes, except to the extent provided
by the Indenture Trustee's certificate of authentication on the Notes. The
Indenture Trustee shall not be accountable for the use or application by the
Issuer of the proceeds of the Notes.
SECTION 6.3. Individual Rights of the Indenture Trustee. The Indenture
Trustee shall not, in its individual capacity, but may in a fiduciary capacity,
become the owner of Notes or otherwise extend credit to the Issuer. The
Indenture Trustee may otherwise deal with the Issuer or its Affiliates with the
same rights it would have if it were not the Indenture Trustee. Any Paying
Agent, Note Registrar, co-registrar or co-paying agent may do the same with like
rights. However, the Indenture Trustee must comply with Sections 6.11 and 6.13.
SECTION 6.4. Funds Held in Trust. Funds and investments and other property
held by the Indenture Trustee shall be segregated and held in one or more Trust
Accounts held with the Indenture Trustee hereunder.
SECTION 6.5. Notice of Defaults. If a Default occurs and is continuing and
is actually known to a Responsible Officer, the Indenture Trustee shall mail to
each Noteholder notice of the Default within 90 days after it occurs. Except in
the case of a Default in payment of principal of or interest on any Note
(including payments pursuant to the mandatory redemption provisions of such
Note), the Indenture Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of Noteholders.
SECTION 6.6. [Reserved]
SECTION 6.7. Compensation and Indemnity. The Issuer shall pay to the
Indenture Trustee from time to time reasonable compensation for its services
hereunder as the Issuer and the Indenture Trustee may agree in writing (which
compensation shall not be limited by any law on compensation of a trustee of an
express trust). The Issuer shall reimburse the Indenture Trustee upon its
request, 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
51
shall include the reasonable compensation and expenses, disbursements and
advances of the Indenture Trustee's agents, counsel, accountants and experts.
The Issuer shall indemnify the Indenture Trustee and its officers, directors,
employees and agents and hold them harmless against any and all loss, liability
or expense (including attorneys' fees and disbursements) incurred by them in
connection with the administration of this trust and the performance of its
duties hereunder, including the costs and expenses of defending themselves
against any claim or liability in connection with the exercise or performance of
their duties hereunder. The Indenture Trustee shall notify the Issuer with a
copy to the Servicer, promptly of any claim for which it may seek indemnity.
Failure by the Indenture Trustee to so notify the Issuer shall not relieve the
Issuer of its obligations hereunder. The Issuer shall defend the claim and the
Indenture Trustee may have separate counsel and the Issuer shall, or shall cause
the Servicer to, pay the fees and expenses of such counsel. The Issuer need not
reimburse any expense or indemnify against any loss, liability or expense
incurred by the Indenture Trustee through the Indenture Trustee's own willful
misconduct, negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee pursuant to this
Section shall survive the discharge of this Indenture. When the Indenture
Trustee incurs expenses after the occurrence of a Default specified in Section
5.1(iv), 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.
The Indenture Trustee agrees not to institute (alone or in conjunction with
any other Person) against the Issuer any bankruptcy, reorganization,
arrangement, insolvency, moratorium or liquidation proceedings or other
proceedings under U.S. federal or State bankruptcy or similar laws on account of
the non-payment to the Indenture Trustee of any amounts provided by this Section
6.7, until after the balance of each Note is reduced to zero and the expiration
of a period equal to the longest applicable preference period under such
bankruptcy laws and other applicable laws plus 366 days following such payment;
provided, that nothing in this paragraph shall preclude, or be deemed to estop,
the Indenture Trustee from taking any action prior to the expiration of the
applicable preference period in any involuntary insolvency proceeding filed or
commenced against the Issuer by a Person other than the Indenture Trustee or to
otherwise limit any claims that the Indenture Trustee may have against the
Issuer. The foregoing shall not limit the ability of the Indenture Trustee to
take any action in accordance with Section 5.2.
SECTION 6.8. Resignation and Removal; Appointment of Successor. No
resignation or removal of the Indenture Trustee and no appointment of a
successor Indenture Trustee shall become effective until the acceptance of
appointment by the successor Indenture Trustee pursuant to this Section. The
Indenture Trustee may resign at any time by so notifying the Issuer in writing.
The Noteholders of not less than 66-2/3% of the Outstanding Principal Balance of
the Notes may remove the Indenture Trustee by so notifying the Indenture Trustee
in writing and may appoint a successor Indenture Trustee. The Issuer shall
remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) the Indenture Trustee is adjudged a bankrupt or insolvent;
52
(iii) a receiver or other public officer takes charge of the
Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes incapable of acting.
If the Indenture Trustee resigns or is removed by the Issuer 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.
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 successor Indenture Trustee
shall mail a notice of its succession to Noteholders. The retiring Indenture
Trustee shall promptly transfer all property held by it as Indenture Trustee to
the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 60 days after
the retiring Indenture Trustee resigns or is removed, the retiring Indenture
Trustee, the Issuer or the Noteholders of not less than a majority of the
Outstanding Principal Balance of the Notes may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any Noteholder
may petition any court of competent jurisdiction for the removal of the
Indenture Trustee and the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant to this
Section, the Issuer's obligations under Section 6.7 shall continue for the
benefit of the retiring Indenture Trustee. The retiring Indenture Trustee shall
have no liability for any act or omission by any successor Trustee.
SECTION 6.9. Successor Indenture Trustee by ▇▇▇▇▇▇. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all its corporate trust business or assets to, another corporation
or banking association, the resulting, surviving or transferee corporation
without any further act shall be the successor Indenture Trustee. The Indenture
Trustee shall provide the Rating Agencies and the Issuer prior written notice of
any such transaction unless prohibited by law or by the applicable agreement;
provided, that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11.
In case at the time such successor(s) 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 trustee hereunder or in the name of
the successor to the Indenture Trustee; and in all such cases such certificates
of authentication shall have the full force and effect to the same extent given
to the certificate of authentication of the Indenture Trustee anywhere in the
Notes or in this Indenture.
53
SECTION 6.10. Appointment of Co-Trustee or Separate Trustee. (a)
Notwithstanding any other provisions of this Indenture, at any time, for the
purpose of meeting any legal requirement of any jurisdiction in which any part
of the Collateral may at the time be located, the Indenture Trustee shall have
the power and may execute and deliver all instruments to appoint one or more
Person(s) to act as co-trustee(s), or separate trustee(s) for the benefit of the
Noteholders, and to vest in such Person(s), in such capacity all rights
hereunder with respect to the Collateral, or any part thereof, and, subject to
the other provisions of this Section, such powers, duties, obligations, rights
and trusts as the Indenture Trustee may consider necessary or desirable. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 6.11 and no notice to
Noteholders of the appointment of any co-trustee or separate trustee shall be
required under Section 6.8.
(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(s) are
to be performed, the Indenture Trustee shall be incompetent or
unqualified to perform such act(s), in which event such rights,
powers, duties and obligations (including the holding of rights with
respect to the Collateral 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, in its sole discretion, 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 Agreement and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection to, the Indenture Trustee. 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 as 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 Agreement on its behalf and in its name.
54
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.
(e) The Indenture Trustee shall have no obligation to determine whether a
co-trustee or separate trustee is legally required in any jurisdiction in which
any part of the Collateral may be located.
SECTION 6.11. Eligibility; Disqualification. The Indenture Trustee shall at
all times satisfy the requirements of TIA Section 310(a) and Section 26(a)(1) of
the Investment Company Act of 1940, as amended. There shall at all times be an
Indenture Trustee hereunder which shall (a) be a corporation organized and doing
business under the laws of the United States of America, any state thereof or
the District of Columbia, authorized under such laws to exercise corporate trust
powers; (b) have a combined capital and surplus of at least $50,000,000 as set
forth in its most recent published annual report of condition; (c) be subject to
supervision or examination by federal or state authority; and (d) at the time of
appointment, shall have a long term senior, unsecured debt rating of "Baa3" or
better by ▇▇▇▇▇'▇ (or, if not rated by ▇▇▇▇▇'▇, a comparable rating by another
statistical rating agency). The Indenture Trustee shall comply with TIA Section
310(b), including the optional provision permitted by the second sentence of TIA
Section 310(b)(9); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture(s) under which other securities
of the Issuer are outstanding if the requirements for such exclusion set forth
in TIA Section 310(b)(1) are met.
If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Indenture Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.
This Indenture shall always have a trustee who satisfies the requirements
of Section 310(a)(1) of the TIA. The Indenture Trustee is subject to the
provisions of Section 310(b) of the TIA regarding disqualification of a trustee
upon acquiring any conflicting interest.
If a default occurs under this Indenture, and the Indenture Trustee is
deemed to have a conflicting interest as a result of acting as trustee for each
of the Class A Notes, the Class B Notes and the Class C Notes, a successor
Indenture Trustee shall be appointed for one or all of such Classes, so that
there will be separate Indenture Trustees for the Class A Notes, the Class B
Notes and the Class C Notes. No such event shall alter the voting rights of the
Class A Noteholders, Class B Noteholders or Class C Noteholders under this
Indenture or any other Related Document. However, so long as any amounts remain
unpaid with respect to the Class A Notes, only the Indenture Trustee for the
Class A Noteholders will have the right to exercise remedies under this
Indenture (but subject to the express provisions of Section 5.2 and to the right
of the Class B Noteholders and Class C Noteholders to receive their share of any
proceeds of enforcement) and thereafter so long as any amounts remain unpaid
with respect to the Class B Notes, only the Indenture Trustee for the Class B
Noteholders will have the right to exercise
55
remedies under the Indenture (but subject to the right of the Class C
Noteholders to receive their share of any proceeds of enforcement). Upon
repayment of the Class A Notes in full, all rights to exercise remedies under
this Indenture will transfer to the Indenture Trustee for the Class B Notes and,
upon payment of the Class B Notes in full, all rights to exercise remedies under
this Indenture will transfer to the Indenture Trustee for the Class C Notes.
In the case of the appointment hereunder of a successor Indenture Trustee
with respect to any Class of Notes, the Issuer, the retiring Indenture Trustee
and the successor Indenture Trustee with respect to such Class of Notes shall
execute and deliver an indenture supplemental hereto wherein the successor
Indenture Trustee shall accept such appointment and which (i) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, the successor Indenture Trustee all the rights, powers, trusts and
duties of the retiring Indenture Trustee with respect to the Notes of the Class
to which the appointment of such successor Indenture Trustee relates, (ii) if
the retiring Indenture Trustee is not retiring with respect to all Classes of
Notes, shall contain such provisions as shall be deemed necessary or desirable
to confirm that all the rights, powers, trusts and duties of the retiring
Indenture Trustee with respect to the Notes of each Class as to which the
retiring Indenture Trustee is not retiring shall continue to be vested in the
retiring Indenture Trustee, and (iii) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Indenture Trustee,
it being understood that nothing herein or in such supplemental indenture shall
constitute such Indenture Trustees co-trustees of the same trust and that each
such Indenture Trustee shall be trustee of a trust or trusts hereunder separate
and apart from any trust or trusts hereunder administered by any other such
Indenture Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Indenture Trustee shall
become effective to the extent provided therein.
SECTION 6.12. Acceptance by Indenture Trustee. The Indenture Trustee hereby
acknowledges the grant of a Lien on the Collateral and the receipt of a Lien on
the assets constituting the Collateral granted by the Issuer hereunder and
declares that the Indenture Trustee, through a custodian, will hold such Lien on
the Collateral granted by the Issuer in trust, for the use and benefit of all
Noteholders subject to the terms and provisions hereof.
SECTION 6.13. Preferential Collection of Claims Against the Issuer. The
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). An Indenture Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.
SECTION 6.14. Reports by Indenture Trustee to Noteholders. To the extent
required by the TIA, within 60 days after each December 20 (beginning in 2007),
following the date of this Indenture, the Indenture Trustee shall mail to the
Noteholders a brief report dated as of such reporting date that complies with
TIA Section 313(a), if such a report is required pursuant to TIA Section 313(a).
The Indenture Trustee also shall comply with TIA Section 313(b). The Indenture
Trustee shall also transmit by mail all reports as required by TIA Section
313(c).
A copy of each such report required under TIA Section 313 shall, at the
time of such transmission to Noteholders be filed with the Commission and with
each stock exchange or other
56
market system on which the Notes are listed. The Issuer shall notify the
Indenture Trustee in writing if the Notes become listed on any stock exchange or
market trading system.
SECTION 6.15. Representations and Warranties. The Indenture Trustee hereby
represents that:
(a) the Indenture Trustee is duly organized and validly existing as a
New York banking corporation in good standing under the laws of New York
with power and authority to own its properties and to conduct its business
as such properties are currently owned and such business is presently
conducted;
(b) the Indenture Trustee has the power and authority to execute and
deliver this Indenture and to carry out its terms; and the execution,
delivery and performance of this Indenture have been duly authorized by the
Indenture Trustee by all necessary corporate action;
(c) the consummation of the transactions contemplated by this
Indenture and the fulfillment of the terms hereof do not conflict with,
result in any breach of any of the terms and provisions of, or constitute
(with or without notice or lapse of time) a default under the articles of
incorporation or bylaws of the Indenture Trustee or to the best of the
Indenture Trustee's knowledge, any material agreement or other instrument
to which the Indenture Trustee is a party or by which it is bound; and
(d) to the best of the Indenture Trustee's knowledge, there are no
proceedings or investigations pending or threatened before any court,
regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Indenture Trustee or its
properties: (i) asserting the invalidity of this Indenture, (ii) seeking to
prevent the consummation of any of the transactions contemplated by this
Indenture or (iii) seeking any determination or ruling that might
materially and adversely affect the performance by the Indenture Trustee of
its obligations under, or the validity or enforceability of, this
Indenture.
SECTION 6.16. The Paying Agent. The Issuer hereby appoints the Indenture
Trustee as the initial Paying Agent. All payments of amounts due and payable
with respect to any Notes that are to be made from amounts withdrawn from the
Note Distribution Account pursuant to Section 8.3(b) or (c) or from the
Collection Account pursuant to Section 8.3(a) shall be made on behalf of the
Issuer by the Paying Agent.
The Paying Agent ▇▇▇▇▇▇ agrees that subject to the provisions of this
Section, it shall:
(i) hold any sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided and pay such sums to such Persons as
herein provided;
(ii) give the Indenture Trustee notice of any default by the
Issuer of which it has actual knowledge in the making of any payment
required to be made with respect to the Notes;
57
(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 any sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay to
the Indenture Trustee any 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; and
(v) comply with all requirements of the Code and any applicable
State law with respect to the withholding from any payments made by it
on any Notes of any applicable withholding taxes imposed thereon and
with respect to any applicable reporting requirements in connection
therewith.
For so long as the Paying Agent and the Indenture Trustee are the same
Person, written notice referred to in this Section between the Paying Agent and
the Indenture Trustee shall not be required.
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 any 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.
Subject to applicable laws with respect to escheat of funds, any amounts
held by the Indenture Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Note and remaining unclaimed for two years
after such amount has become due and payable shall be discharged from such trust
and be paid to the Issuer on Issuer Request; and the related Noteholder shall
thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust funds 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 funds remain 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 funds then remaining will be repaid to the Issuer. The Indenture
Trustee shall also adopt and employ, at the expense of the Issuer, any other
reasonable means of notification of such repayment (including mailing notice of
such repayment to Noteholders whose Notes have been called but have not been
surrendered for redemption or whose right to or interest in amounts 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
Noteholder).
Each Paying Agent (other than the initial Paying Agent) shall be appointed
by Issuer Order with written notice thereof to the Indenture Trustee. Any Paying
Agent appointed by the Issuer shall be a Person who would be eligible to be
Indenture Trustee hereunder as provided in
58
Section 6.11. The Issuer shall not appoint any Paying Agent (other than the
Indenture Trustee) which is not, at the time of such appointment, a depository
institution or trust company, including the Indenture Trustee, that (a) is
incorporated under the laws of the United States of America or any State
thereof, (b) is subject to supervision and examination by federal or state
banking authorities and (c) has outstanding unsecured commercial paper or other
short-term unsecured debt obligations that are rated "A-1+" by S&P or "Prime-1"
by ▇▇▇▇▇'▇ (or its equivalent).
SECTION 6.17. Repayment of Amounts Held by Paying Agent. In connection with
the satisfaction and discharge of this Indenture with respect to the Notes, all
funds then held by any Paying Agent other than the Indenture Trustee under 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 4.1, and
thereupon such Paying Agent shall be released from all further liability with
respect to such funds.
SECTION 6.18. Provisions of Swap Agreement. The Issuer has entered into the
Swap Agreement with the Swap Counterparty, in a form satisfactory to the Rating
Agencies. The Issuer may, from time to time, enter into one or more replacement
Swap Agreement in the event that the Swap Agreement is terminated prior to its
scheduled expiration pursuant to a Swap Event of Default or a Swap Termination
Event.
Upon the occurrence of (i) any Swap Event of Default arising from any
action taken, or failure to act, by the Swap Counterparty, or (ii) any Swap
Termination Event (except as described in the following sentence) with respect
to which the Swap Counterparty is an Affected Party (as defined in the Swap
Agreement), the Indenture Trustee may and will, at the direction of the holders
of at least 51% of the Outstanding Principal Balance of the Class A-1 Notes, the
Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes, the Class B Notes and
the Class C Notes, acting together as a single Class, direct the Issuer to
designate an Early Termination Date (as defined in the Swap Agreement) with
respect to the Swap Agreement and the Issuer shall upon such direction designate
an Early Termination Date. If a Swap Termination Event occurs as a result of the
insolvency or bankruptcy of the Swap Counterparty, the Indenture Trustee will
direct the Issuer to designate an Early Termination Date and the Issuer shall
upon such direction designate an Early Termination Date pursuant to the Swap
Agreement.
The Swap Counterparty shall not have any voting rights or rights to
exercise any remedies under this Indenture until after the Outstanding Principal
Balance of the Notes has been reduced to zero and the Noteholders have been paid
all amounts owed to them under this Indenture. After the Outstanding Principal
Balance of the Notes has been reduced to zero and the Noteholders have been paid
all amounts owed to them under this Indenture, the Swap Counterparty shall have
all of the rights and obligations, including all voting rights, of the
Noteholders set forth in this Indenture. Such voting rights shall be exercisable
at any time by the Swap Counterparty based upon the notional amount outstanding
under the Swap Agreement at such time.
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ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1. Issuer To Furnish Indenture Trustee Names and Addresses of
Noteholders. The Issuer will furnish or cause to be furnished to the Indenture
Trustee: (a) not more than five Business Days after the earlier of: (i) each
Record Date and (ii) 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 (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 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.
SECTION 7.2. 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 7.1 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 Section 7.1 upon receipt of a new list so furnished.
(b) Three or more Noteholders, or one or more Noteholder(s) evidencing at
least 25% of the Outstanding Principal Balance of the Notes, 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 7.3. 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) that the Issuer
may be required to file with the Commission pursuant to Section 13 or
15(d) of the Securities Exchange Act or, if the Issuer is not required
to file with the Commission information, documents or reports pursuant
to either Section 13 or Section 15(d) of the Securities Exchange Act,
then the Issuer will file with the Indenture Trustee and with the
Commission, in accordance with rules and regulations prescribed by the
Commission, such of the supplementary and period information,
documents and reports required pursuant to the Securities Exchange Act
as may be prescribed in such rules and regulations;
(ii) file with the Commission, in accordance with the 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 (with a copy of any such filings being delivered promptly to
the Indenture Trustee); and supply to the Indenture
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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) as may be required by the rules and
regulations prescribed from time to time by the Commission.
Unless the Issuer otherwise determines, the fiscal year of the Issuer shall
end on December 31 of each year.
SECTION 7.4. De-Listing of Definitive Notes. If as of the beginning of any
fiscal year for the Issuer, the Definitive Notes are held (directly or, in the
case of Book Entry Notes held through the Clearing Agency) by less than 300
Noteholders and/or Clearing Agency participants having accounts with the
Clearing Agency, the Issuer shall, in accordance with the Securities Exchange
Act and the rules and regulations promulgated thereunder, timely file a Form 15
with respect to the Issuer suspending all reporting requirements under the
Securities Exchange Act.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1. Collection of Amounts Due. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all sums and other property payable to
or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such amounts received by it as provided in this
Indenture. Amounts properly withdrawn by the Issuer pursuant to Section 8.3 of
this Indenture shall be deemed released from the Collateral and the security
interest therein granted to the Indenture Trustee, and the Issuer shall in no
event thereafter be required to refund any such withdrawn amounts. To the extent
there are uninvested amounts deposited in any of the Trust Accounts (as defined
below), the Issuer shall invest all such amounts in Permitted Investments
selected by the Issuer that mature no later than the immediately succeeding
Transfer Date preceding the following Payment Date.
SECTION 8.2. Trust Accounts. (a) On or prior to the Closing Date, the
Issuer covenants to have established and shall thereafter maintain the following
accounts with the Indenture Trustee (the "Trust Accounts"), which accounts shall
be Eligible Deposit Accounts:
(i) Collection Account;
(ii) Note Distribution Account; and
(iii) Reserve Account.
(b) If any Trust Account is a Securities Account, such Trust Account will
be maintained in accordance with Section 6.1(h).
(c) If any Trust Account is a Deposit Account: (i) If, at any time, any
such Trust Account ceases to be an Eligible Deposit Account, the Issuer shall
within 10 Business Days (or such longer period, not to exceed 30 calendar days,
as to which each Rating Agency may
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consent) establish a new Trust Account as an Eligible Deposit Account and shall
transfer any cash and/or any investments held in the no-longer Eligible Deposit
Account to such new Trust Account; and
(ii) the Issuer and Indenture Trustee agree, as security for the
Issuer's obligations under this Indenture, that:
(A) any Trust Account Property that constitutes, or is held
through or in, a Deposit Account shall be, or shall be held through or
in, an Eligible Deposit Account continuously identified in the deposit
bank's books and records as subject to a security interest of the
Indenture Trustee and, except as maybe expressly provided herein to
the contrary, in order to perfect the security interest of the
Indenture Trustee in accordance with Section 9.104 of the UCC, the
Indenture Trustee shall have the power to direct disposition of the
funds in such Deposit Account without further consent by the Issuer;
provided, however, that prior to delivery by the Indenture Trustee to
the Issuer of notice otherwise, the Issuer shall have the right to
direct the disposition of funds in such Deposit Account; provided,
further that the Indenture Trustee agrees that it will not deliver
such notice or exercise its power to direct disposition of the funds
in such Deposit Account until an Event of Default has occurred; and
(B) all Permitted Investments and other investments shall be held
by the Indenture Trustee in accordance with this Agreement and shall
be subject to the Indenture Trustee's security interest in such Trust
Property.
SECTION 8.3. Priority of Payments. (a) On each Payment Date prior to an
Event of Default and acceleration of the Notes, after the payment to the
Servicer of any accrued and unpaid Servicing Fees and reimbursement of any
Servicing Advances, from any amounts withdrawn from the Reserve Account on the
related Transfer Date and Available Amounts, payments shall be made in the
following order of priority:
(i) to the Indenture Trustee, amounts payable to the Indenture
Trustee pursuant to Section 6.7 of the Indenture for the related
Collection Period, provided that, except after the occurrence and
during the continuance of an Event of Default, the aggregate amounts
payable other than in respect of fees shall not exceed $75,000 during
any calendar year;
(ii) to the Administrator, the Administration Fee and all unpaid
Administration Fees from prior Collection Periods in accordance with
the Administration Agreement;
(iii) to the Swap Counterparty any Swap Payments Outgoing in
accordance with the Swap Agreement;
(iv) to pay with the same priority and ratably in proportion to
the Outstanding Principal Balance of the Class A Notes and the amount
of any Swap Termination Payment due and payable by the Issuer to the
Swap Counterparty:
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(1) to the Note Distribution Account, the Monthly Interest
Amount Payable on the Class A Notes; and
(2) to the Swap Counterparty, any Swap Termination Payments
payable to the Swap Counterparty upon the termination of the Swap
Agreement; provided that if any amounts allocable to the Class A
Notes are not needed to pay interest due on such Class A Notes as
of such Payment Date, such amounts will be applied to pay the
portion, if any, of any Swap Termination Payment remaining
unpaid;
(v) to the Note Distribution Account, the Monthly Interest Amount
Payable on the Class B Notes;
(vi) to the Note Distribution Account, the Monthly Interest
Amount Payable on the Class C Notes;
(vii) to the Note Distribution Account, principal payable on the
Notes in an amount equal to the amount by which the Note Balance of
all the Notes then outstanding exceeds the excess of (x) the Pool
Balance at the end of the related Collection Period over (y) the
Overcollateralization Amount;
(viii) to the Note Distribution Account, 50% of the Excess Spread
Amount, if any;
(ix) to the Reserve Account, the amount, if any, required to be
deposited in the Reserve Account pursuant to Section 8.4(c);
(x) to the Indenture Trustee, any amounts payable to the
Indenture Trustee pursuant to Section 6.7 of the Indenture to the
extent not previously reimbursed; and
(xi) to the Issuer, the remaining balance, if any.
(b) On each Payment Date prior to an Event of Default and acceleration of
the Notes, funds on deposit in the Note Distribution Account shall be paid in
the following order of priority:
(i) to the Class A-1 Noteholders, Class A-2a Noteholders, Class
A-2b Noteholders, Class A-3a Noteholders, Class A-3b Noteholders and
the Class A-4 Noteholders, an amount equal to the Monthly Interest
Amount Payable in respect of the Class A-1 Notes, Class A-2a Notes,
Class A-2b Notes, Class A3a Notes, Class A-3b Notes and Class A-4
Notes for the Interest Accrual Period immediately preceding such
Payment Date, together with any such amounts that accrued in respect
of prior Interest Accrual Periods for which no payment was previously
made; provided, that if the Available Amounts remaining to be paid
pursuant to this clause are less than the full amount required to be
so paid, such remaining Available Amounts shall be allocable to the
Holders of the Class A-1 Notes, Class A-2a Notes, Class A-2b Notes,
Class A3a Notes, Class A-3b Notes
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and the Class A-4 Notes pro rata based upon the aggregate amount of
interest due to each class;
(ii) to the Class B Noteholders, the Monthly Interest Amount
Payable in respect of the Class B Notes; provided, that if the
Available Amounts remaining to be paid pursuant to this clause are
less than the full amount required to be so paid, such remaining
Available Amounts shall be paid to the Holders of Class B Notes pro
rata based on their respective entitlement pursuant to this clause;
(iii) to the Class C Noteholders, the Monthly Interest Amount
Payable in respect of the Class C Notes; provided, that if the
Available Amounts remaining to be paid pursuant to this clause are
less than the full amount required to be so paid, such remaining
Available Amounts shall be paid to the Holders of Class C Notes pro
rata based on their respective entitlement pursuant to this clause;
(iv) to the Class A-1 Noteholders, until the Outstanding
Principal Balance of the Class A-1 Notes has been reduced to zero;
(v) to the Class A-2a Noteholders and the Class A-2b Noteholders
(pro rata based on the Outstanding Principal Balances of the Class
A-2a Notes and the Class A-2b Notes), until the Outstanding Principal
Balances of the Class A-2a Notes and the Class A-2b Notes have been
reduced to zero;
(vi) to the Class A-3a Noteholders and the Class A-3b Noteholders
(pro rata based on the Outstanding Principal Balances of the Class
A-3a Notes and the Class A-3b Notes), until the Outstanding Principal
Balances of the Class A-3a Notes and the Class A-3b Notes have been
reduced to zero;
(vii) to the Class A-4 Noteholders, until the Outstanding
Principal Balance of the Class A-4 Notes has been reduced to zero;
(viii) to the Class B Noteholders until the Outstanding Principal
Balance of the Class B Notes has been reduced to zero; and
(ix) to the Class C Noteholders until the Outstanding Principal
Balance of the Class C Notes has been reduced to zero.
(c) Following an Event of Default and acceleration of the Notes, after the
payment to the Servicer of any accrued and unpaid Servicing Fees and
reimbursement of any Servicing Advances, any amounts withdrawn from the Reserve
Account on the related Transfer Date and Available Amounts will be applied in
the following order of priority, at the date or dates fixed by the Indenture
Trustee and, in case of the distribution of the entire amount due on account of
principal or interest, upon presentation of the Notes and surrender thereof:
(i) to pay the Indenture Trustee, for all amounts due under
Section 6.7;
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(ii) to pay the Administrator, all accrued and unpaid
Administration Fees;
(iii) to pay the Swap Counterparty any Swap Payments
Outgoing;
(iv) to pay with the same priority and ratably in proportion
to the Outstanding Principal Balance of the Class A Notes and the
amount of any Swap Termination Payment due and payable by the
Issuer to the Swap Counterparty:
(A) the Monthly Interest Amount Payable on each class
of Class A Notes during the prior Interest Accrual Period,
plus any amount of interest on the Class A Notes that was
not paid when due (and, to the extent permitted by law, any
interest on that unpaid amount); and
(B) any Swap Termination Payments payable to the Swap
Counterparty due under the Swap Agreement; provided that if
any amounts allocable to the Class A Notes are not needed to
pay interest due on such Class A Notes as of such payment
date, such amounts will be applied to pay the portion, if
any, of any Swap Termination Payment remaining unpaid;
(v) to the Class A Noteholders pro rata in respect of
principal until the Class A Noteholders are paid in full;
(vi) to pay the Monthly Interest Amount Payable on the Class
B Notes during the prior interest period, plus any amount of
interest on the Class B Notes that was not paid when due (and, to
the extent permitted by law, any interest on that unpaid amount);
(vii) to the Class B Noteholders in respect of principal
until the Class B Noteholders are paid in full;
(viii) to pay the Monthly Interest Amount Payable on the
Class C Notes during the prior interest period, plus any amount
of interest on the Class C Notes that was not paid when due (and,
to the extent permitted by law, any interest on that unpaid
amount);
(ix) to the Class C Noteholders in respect of principal
until the Class C Noteholders are paid in full; and
(x) to the Issuer the remaining balance, if any.
(d) The Indenture Trustee may fix a special record date and special payment
date for any payment to Noteholders pursuant to this Section. At least 15 days
before such special record
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date, the Issuer shall mail to each Noteholder and the Indenture Trustee a
notice that states the special record date, the special payment date and the
amount to be paid.
(e) All Class A Notes issued under this Indenture shall be in all respects
equally and ratably entitled to the benefits hereof without preference, priority
or distinction on account of the actual time or times of authentication and
delivery, all in accordance with the terms and provisions of this Indenture.
Payments of principal and interest on the Class A Notes shall be made in
accordance with the priorities set forth in this Section 8.3.
(f) All Class B Notes issued under this Indenture shall be in all respects
equally and ratably entitled to the benefits hereof without preference, priority
or distinction on account of the actual time or times of authentication and
delivery, all in accordance with the terms and provisions of this Indenture.
Payments of principal and interest on the Class B Notes shall be made pro rata
among all Outstanding Class B Notes, without preference or priority of any kind.
(g) All Class C Notes issued under this Indenture shall be in all respects
equally and ratably entitled to the benefits hereof without preference, priority
or distinction on account of the actual time or times of authentication and
delivery, all in accordance with the terms and provisions of this Indenture.
Payments of principal and interest on the Class C Notes shall be made pro rata
among all Outstanding Class C Notes, without preference or priority of any kind.
SECTION 8.4. Reserve Account. (a) On each Transfer Date, if the sum of
Available Amounts and other amounts on deposit in the Collection Account is less
than the aggregate amount required to be paid or deposited pursuant to clauses
(i) through (vii) of Section 8.3(a), the Issuer shall withdraw from the Reserve
Account the amount of such deficiency up to the Available Reserve Account Amount
and shall deposit such amount in the Collection Account for application in
accordance with such clauses of Section 8.3(a). On each Transfer Date, if, after
giving effect to the Available Amounts payable and amounts withdrawn from the
Reserve Account pursuant to the preceding sentence and applied pursuant to
Section 8.3, the Outstanding Principal Balance of any Class would exceed zero on
the Maturity Date for such Class, the Issuer shall withdraw from the Reserve
Account the amount of such deficiency up to the Available Reserve Account Amount
and shall deposit such amount in the Collection Account.
(b) On the Final Maturity Date, and on the first Transfer Date following
the occurrence of an Event of Default with respect to the Notes that has
resulted in the acceleration of the Notes, the Issuer shall withdraw from the
Reserve Account the Available Reserve Account Amount and shall apply such amount
in accordance with Section 8.3(c).
(c) If on any Payment Date, after giving effect to all withdrawals from the
Reserve Account on the related Transfer Date, the Available Reserve Account
Amount is less than the Required Reserve Account Amount then in effect,
Available Amounts and other amounts on deposit in the Collection Account shall
be deposited into the Reserve Account pursuant to Section 8.3(a)(ix) up to the
amount of the Reserve Account Deficiency.
(d) On the date on which the Reserve Account has been terminated, after
giving effect to any withdrawal on such date pursuant to Section 8.4(a) or (b)
and making any payments
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to the Noteholders required pursuant to this Indenture, all amounts then
remaining in the Reserve Account shall be released to the Issuer.
(e) The Excess Reserve will be withdrawn from the Reserve Account and
deposited in the Collection Account prior to the applicable Payment Date.
(f) The Reserve Account will terminate on the earliest to occur of (i) the
date on which the Note Balance has been paid in full and all other amounts
payable to the Noteholders have been paid in full; (ii) the Final Maturity Date;
and (iii) the termination of the Issuer.
SECTION 8.5. Reports. On each Determination Date, the Issuer shall, or
shall cause the Servicer to, provide to the Indenture Trustee (with a copy to
the Rating Agencies), for the Indenture Trustee to forward to each Noteholder of
record, a statement substantially in the form of Exhibit E setting forth at
least the following information as to each Class of the Notes to the extent
applicable:
(i) the principal amount to be paid on each Class of Notes;
(ii) the interest amount to be paid on each Class of Notes;
(iii) the Pool Balance as of the opening of business on the first
day of the Collection Period in which such Determination Date occurs;
(iv) the aggregate Outstanding Principal Balance and the Note
Pool Factor for each Class of Notes after giving effect to payments
allocated to principal reported under clause (i) above;
(v) the amount of the Servicing Fee paid to the Servicer with
respect to the preceding Collection Period;
(vi) the amount of Servicing Advances with respect to the
preceding Collection Period;
(vii) the amount of the Administration Fee paid to the
Administrator in respect of the preceding Collection Period;
(viii) the amount of other fees and expenses paid ($______) and
the identity of the party receiving such fees and expenses;
(ix) the aggregate outstanding principal balance of any Loans
that became Liquidated Loans for such Collection Period;
(x) the portion of the outstanding principal balance written off
in respect of Loans that became Defaulted Loans;
(xi) the aggregate Loan Value of Loans that became Defaulted
Loans for such Collection Period;
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(xii) the aggregate Purchase Amounts for Loans, if any, that were
repurchased or purchased in such Collection Period;
(xiii) the aggregate outstanding principal balance of Loans that
became Delinquent Loans for such Collection Periods;
(xiv) the aggregate amount of Recoveries for such Collection
Period;
(xv) the aggregate amount of Liquidation Proceeds for such
Collection Period; and
(xvi) material breaches of Loan representations or warranties or
covenants in the Related Documents.
Each amount set forth pursuant to clauses (i), (ii), (iii), (v) and (vi)
shall be expressed as a dollar amount per $1,000 of original principal balance
of such Note.
In addition, the Issuer shall, or shall cause, a copy of (i) the Servicer's
certificate referred to in Section 2.7, (ii) the Officer's Certificate referred
to in Section 2.8(a) or 2.8(b) and (iii) the report of certified public
accountants referred to in Section 2.9, in each case, of the Servicing Agreement
to be sent to the Rating Agencies and the Indenture Trustee. A copy of such
Servicer's certificate, such Officer's Certificate and such report may be
obtained by any Noteholder by a request in writing to the Issuer addressed to
the Corporate Trust Office.
SECTION 8.6. General Provisions Regarding Accounts. (a) Funds on deposit in
the Trust Accounts shall be invested or reinvested by the Issuer in Permitted
Investments selected by the Issuer. All Investment Earnings on funds on deposit
in the Trust Accounts shall be deemed to constitute a portion of the Available
Amounts. Other than as permitted by the Rating Agencies, funds on deposit in the
Trust Accounts shall be invested in Permitted Investments that will mature so
that such funds will be available at the close of business on the Transfer Date
preceding the following Payment Date; provided, however, that funds on deposit
in Trust Accounts may be invested in Permitted Investments of the entity serving
as Indenture Trustee that may mature so that such funds will be available on the
date prior to the Payment Date. Funds deposited in a Trust Account on the
Transfer Date that precedes a Payment Date upon the maturity of any Permitted
Investments are not required to be invested overnight.
(b) The Issuer shall ensure that, in connection with any investment of any
funds or any sale of any investment held in any of the Trust Accounts, the Lien
granted to the Indenture Trustee and perfected in such Trust Account will
continue to be perfected in such investment or the proceeds of such sale, in
either case without any further action by any Person, and, in connection with
any direction to the Indenture Trustee to make any such investment or sale, if
requested by the Indenture Trustee, the Issuer shall deliver or cause to be
delivered to the Indenture Trustee an Opinion of Counsel to such effect.
(c) The Indenture Trustee shall not in any way be held liable by reason of
any insufficiency in any of the Trust Accounts resulting from any loss on any
Permitted Investment included therein, except for losses attributable to the
Indenture Trustee's failure to make payments on such Permitted Investments
issued by the Indenture Trustee, in its commercial
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capacity as principal obligor and not as trustee, in accordance with their
terms. The Indenture Trustee shall have no liability in respect of losses
incurred as a result of the liquidation of any Permitted Investment prior to its
stated maturity.
(d) (i) If a Default or Event of Default shall have occurred and be
continuing with respect to the Notes but the Notes shall not have been declared
due and payable pursuant to Section 5.2, or, (ii) if the Notes shall have been
declared due and payable following an Event of Default, but amounts collected or
receivable from the Collateral are being applied in accordance with Section
8.3(c) as if there had not been such a declaration; then the Issuer shall, to
the fullest extent practicable, invest and reinvest funds in the Trust Accounts
in the Permitted Investments identified in clause (d) of the definition of
Permitted Investments.
SECTION 8.7. Release of Collateral. (a) Subject to the payment of its fees
and expenses pursuant to Section 6.7, the Indenture Trustee may, and when
required by 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 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 funds.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and all sums due to the Indenture Trustee pursuant to Section 6.7
have been paid, release any remaining portion of the Collateral that secured the
Notes and the Swap Agreement from the Lien of this Indenture.
(c) The Indenture Trustee shall release property from the Lien of this
Indenture pursuant to this Section only upon receipt of an Issuer Request
requesting such release accompanied by an Officers' Certificate, an Opinion of
Counsel and (if required by the TIA) Independent Certificates in accordance with
TIA Sections 314(c) and 314(d)(1) meeting the applicable requirements of Section
11.1.
SECTION 8.8. Opinion of Counsel. The Indenture Trustee shall receive at
least seven days' notice when requested by the Issuer to take any action
pursuant to Section 8.7(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 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 this Indenture; provided, however,
that such Opinion of Counsel shall not be required to express an opinion as to
the fair value of the Collateral. Counsel rendering any such opinion may rely,
without independent investigation, on the accuracy and validity of any
certificate or other instrument delivered to the Indenture Trustee in connection
with any such action.
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ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1. Supplemental Indentures Without Consent of Noteholders and
Swap Counterparty. Without the consent of the Noteholders and the Swap
Counterparty but with prior written notice to the Rating Agencies, the Issuer
and the Indenture Trustee, when authorized by an Issuer Order, at any time and
from time to time, may enter into one or more indentures supplemental hereto
(which shall conform to 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:
(a) 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 a Lien on any property subject or required to be
subjected to the Lien of this Indenture, or to subject to the Lien of this
Indenture additional property;
(b) 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;
(c) to add to the covenants of the Issuer, for the benefit of the
Noteholders and the Swap Counterparty, or to surrender any right or power herein
conferred upon the Issuer;
(d) to mortgage or pledge any property to or with the Indenture Trustee;
(e) to replace the Reserve Account with another form of credit enhancement;
provided that the Rating Agency Condition is satisfied;
(f) to cure any ambiguity, to correct or supplement any provision herein or
in any supplemental indenture that may be inconsistent with any other provision
herein or in any supplemental indenture or 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 materially
adversely affect the interests of the Noteholders or the Swap Counterparty;
(g) to evidence and provide for the acceptance of the appointment hereunder
by a successor or additional trustee with respect to the Notes or any class
thereof and to add to or change any of the provisions of this Indenture as shall
be necessary to facilitate the administration of the trusts hereunder by more
than one trustee, pursuant to the requirements of Article VI; or
(h) to modify, eliminate or add to the provisions of this Indenture to such
extent as shall be necessary to effect the qualification of this Indenture under
the TIA or under any similar Federal statute hereafter enacted and to add to
this Indenture such other provisions as may be expressly required by the TIA.
The Trustee is hereby authorized to join in the execution of any such
supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
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SECTION 9.2. Supplemental Indentures With Consent of Noteholders. The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, with
prior written notice to the Rating Agencies and with the consent of the
Noteholders evidencing not less than a majority of the Outstanding Principal
Balance of the Notes, by Act of such Noteholders 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 no such
supplemental indenture shall, as evidenced by an Officer's Certificate of the
Issuer delivered to the Indenture Trustee, adversely affect in any material
respect the interests of the Swap Counterparty, without the consent of the Swap
Counterparty; and, provided further, that no such supplemental indenture shall,
as evidenced by an Officer's Certificate of the Issuer delivered to the
Indenture Trustee, adversely affect in any material respect the interests of a
Noteholder, without the consent of such Noteholder affected thereby:
(a) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof, the interest rate
thereon or the Redemption Price with respect thereto, change the provisions of
this Indenture relating to the application of collections on, or the proceeds of
the sale of, the Collateral to the payment of principal of or interest on the
Notes, or change any place of payment where, or the coin or currency in which,
any Note or the interest thereon is payable, or impair the right to institute
suit for the enforcement of the provisions of this Indenture requiring the
application of funds available therefor, as provided in Article V, to the
payment of any such amount due on or after the respective due dates thereof (or,
in the case of redemption, on or after the Redemption Date);
(b) reduce the percentage of the Outstanding Principal Balance, the consent
of the Noteholders of which is required for any such supplemental indenture, or
the consent of the Noteholders 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;
(c) modify or alter the provisions of the proviso to the definition of
"Outstanding";
(d) reduce the percentage of the Outstanding Principal Balance required to
direct the Indenture Trustee to direct the Issuer to sell or liquidate the
Collateral pursuant to Section 5.2;
(e) modify any provision of this Section except to increase any percentage
specified herein or to provide that certain additional provisions of this
Indenture or the Related Documents cannot be modified or waived without the
consent of the Noteholder of each Outstanding Note affected thereby;
(f) modify any of the provisions of this Indenture in such manner as to
affect the calculation of the amount of any payment of interest or principal due
on any Note on any Payment Date (including the calculation of any of the
individual components of such calculation) or to affect the rights of the
Noteholders to the benefit of any provisions for the mandatory redemption of the
Notes contained herein; or
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(g) permit the creation of any Lien ranking prior to or on a parity with
the Lien of this Indenture with respect to any part of the Collateral or, except
as otherwise permitted or contemplated herein, terminate the Lien of this
Indenture on any property at any time subject hereto or deprive any Noteholder
of the security provided by the Lien of this Indenture.
It shall not be necessary for any Act of the 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. The manner
of obtaining such consents (and any other consents of Noteholders provided for
in this Indenture or in any other Related Document) and of evidencing the
authorization of the execution thereof by Noteholders shall be subject to such
reasonable requirements as the Indenture Trustee may provide.
Promptly after the execution by the Issuer and the Indenture Trustee of any
supplemental indenture pursuant to this Section, the Indenture Trustee shall
mail to the Noteholders to which such amendment or supplemental indenture
relates a notice setting forth in general terms the substance of such
supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
SECTION 9.3. Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modifications thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled to receive, and,
subject to Sections 6.1 and 6.2, shall be fully protected in relying upon, an
Opinion of Counsel 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 9.4. Effect of Supplemental Indenture. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and be deemed to be modified and amended in accordance therewith with respect
to the Notes and the Swap Agreement affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer, the Swap Counterparty and
the Noteholders shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments, and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.
SECTION 9.5. Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
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SECTION 9.6. Conformity with Trust Indenture Act. Every amendment of this
Indenture and every supplemental indenture executed pursuant to this Article IX
shall conform to the requirements of the TIA as then in effect so long as this
Indenture shall then be qualified under the TIA.
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1. Redemption. The Notes are subject to redemption in whole, but
not in part, on or after any Payment Date on which the aggregate Pool Balance
(calculated as of the end of the related Collection Period) first becomes 10% or
less of the Pool Balance as of the Cut-off Date and for a purchase price equal
to the Redemption Price; provided, however, that the Issuer has available funds
sufficient to pay the Redemption Price following the exercise by the Purchaser
of the clean up call set forth in Section 6.1 of the Purchase and Sale
Agreement. The Issuer shall furnish the Rating Agencies notice of such
redemption. If such Notes are to be redeemed pursuant to this Section, the
Issuer shall furnish notice of such election to the Indenture Trustee not later
than 25 days prior to the Redemption Date and the Issuer shall deposit in the
Note Distribution Account the Redemption Price of the Notes to be redeemed.
SECTION 10.2. Form of Redemption Notice. Notice of redemption under Section
10.1 shall be given by the Issuer by first-class mail, postage prepaid, mailed
not less than five days prior to the applicable Redemption Date to each
Noteholder, as of the close of business on the Record Date preceding the
applicable Redemption Date, at such Noteholder's address appearing in the Note
Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the place where such Notes are to be surrendered for
payment of the Redemption Price (which shall be the office or agency
of the Issuer to be maintained as provided in Section 3.2); and
(iv) the CUSIP numbers of the Notes being redeemed.
Failure to give notice of redemption, or any defect therein, to any
Noteholder shall not impair or affect the validity of the redemption of any
other Note.
SECTION 10.3. Notes Payable on Redemption Date. The Notes or portions
thereof to be redeemed shall, following notice of redemption pursuant to this
Article, become due and payable on the Redemption Date at the Redemption Price
and (unless the Issuer shall default in the payment of the Redemption Price) no
interest shall accrue on the Redemption Price for any period after the date to
which accrued interest is calculated for purposes of calculating the Redemption
Price.
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ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Compliance Certificates and Opinions, etc. (a) Upon any
written application or request (or oral application with prompt written or
telecopied confirmation) by the Issuer to the Indenture Trustee to take any
action under this Indenture, other than any request that (i) the Indenture
Trustee authenticate the Notes specified in such request, or (ii) the Indenture
Trustee pay amounts due and payable to the Issuer hereunder to the Issuer's
assignee specified in such request, the Issuer shall furnish to the Indenture
Trustee: (1) an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with, (2) an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with and (3)
(if required by the TIA) an Independent Certificate from a firm of certified
public accountants meeting the applicable requirements of this Section, except
that, in the case of any such application or request as to which the furnishing
of such documents is specifically required by 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:
(w) 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;
(x) 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;
(y) a statement that, in the opinion of each such signatory, such
signatory has made (or has caused to be 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
(z) a statement as to whether, in the opinion of each such signatory,
such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the Lien of this Indenture, the
Issuer shall, in addition to any obligation imposed in Section 11.1(a) or
elsewhere in this Indenture, furnish to the Indenture Trustee an Officers'
Certificate certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days of such deposit) to the Issuer
of the Collateral or other property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the Indenture
Trustee an Officers' Certificate described in clause (i), the Issuer
shall also deliver to the Indenture Trustee an Independent Certificate
as to the same matters if the fair value to the Issuer of the
Collateral or other property or securities to be so
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deposited and of all other such Collateral or other property or
securities released from the Lien of this Indenture since the
commencement of the then-current fiscal year of the Issuer, as set
forth in the certificates required by clause (i) and this clause (ii),
equals 10% or more of the Outstanding Principal Balance of the Notes,
but such certificate need not be furnished with respect to any
Collateral or other property or securities so deposited if the fair
value thereof to the Issuer as set forth in the related Officers'
Certificate is less than $1,000,000 or less than one percent of the
then Outstanding Principal Balance of the Notes.
(iii) Other than with respect to property as contemplated by
clause (v), whenever any Collateral or other property or securities
are to be released from the Lien of this Indenture, the Issuer shall
also furnish to the Indenture Trustee an Officers' 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 Collateral or other property or securities proposed to be released
and stating that in the opinion of such person the proposed release
will not impair the security under this Indenture in contravention of
the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the Indenture
Trustee an Officers' Certificate described in clause (iii), the Issuer
shall also deliver to the Indenture Trustee an Independent Certificate
as to the same matters if the fair value to the Issuer of the
Collateral or other property or securities and of all other such
Collateral or other property, other than property as contemplated by
clause (v), or securities released from the Lien of this Indenture
since the commencement of the then-current fiscal year of the Issuer,
as set forth in the certificates required by clause (iii) and this
clause (iv), equals 10% or more of the Outstanding Principal Balance
of the Notes, but such certificate need not be furnished in the case
of any release of Collateral or other property or securities if the
fair value thereof to the Issuer as set forth in the related Officers'
Certificate is less than $1,000,000 or less than one percent of the
then Outstanding Principal Balance of the Notes.
(v) Notwithstanding Section 3.9 or any other provision of this
Section, the Issuer may, without compliance with the requirements of
the other provisions of this Section: (A) collect, liquidate, sell or
otherwise dispose of Loans and Equipment as and to the extent
permitted or required by the Related Documents and (B) make cash
payments out of the Trust Accounts as and to the extent permitted or
required by the Related Documents so long as the Issuer shall deliver
to the Indenture Trustee every six months, commencing March 15, 2007,
an Officers' Certificate of the Issuer stating that all such
dispositions of Collateral that occurred since the execution of the
previous such Officers' Certificate (or for the first such Officers'
Certificate, since the Closing Date) were in the ordinary course of
the Issuer's business and that the proceeds thereof were applied in
accordance with the Related Documents.
SECTION 11.2. Form of Documents Delivered to Indenture Trustee. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person,
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it is not necessary that all such matters be certified by, or covered by the
opinion of, only one such Person, or that they be so certified or covered by
only one document, but one such Person may certify or give an opinion with
respect to some matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such matters in one or
several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate, opinion or representations
with respect to the matters upon which his certificate or opinion is based
is/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 any
Seller, the Servicer, the Purchaser, the Issuer or the Administrator, Managing
Member, stating that the information with respect to such factual matters is in
the possession of any Seller, the Servicer, the Purchaser, the Issuer or the
Administrator, Managing Member, as applicable, unless such Authorized Officer or
counsel knows, or in the exercise of reasonable care should know, that the
certificate, opinion or representations with respect to such matters is/are
erroneous. Any Opinion of Counsel may be based on the written opinion of other
counsel, in which event such Opinion of Counsel shall be accompanied by a copy
of such other counsel's opinion and shall include a statement to the effect that
such counsel believes that such counsel and the Indenture Trustee may reasonably
rely upon the opinion of such other counsel.
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.
Where any Person is required or permitted to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
Whenever in this Indenture, in connection with any application, certificate
or report to the Indenture Trustee, it is provided that the Issuer shall deliver
any document as a condition of the granting of such application, or as evidence
of the Issuer's compliance with any term hereof, it is intended that the truth
and accuracy, at the time of the granting of such application or at the
effective date of such certificate or report (as the case may be), of the facts
and opinions stated in such document shall in such case be conditions precedent
to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI.
SECTION 11.3. Acts of Noteholders. (a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture to
be given or taken by Noteholders may be embodied in and evidenced by one or more
instrument(s) 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(s)
are delivered to the Indenture Trustee, and, where it is hereby expressly
required,
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to the Issuer. Such instrument(s) (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Noteholders
signing such instrument(s). 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 6.1) conclusive in favor of the Indenture
Trustee and the Issuer, if made in the manner provided in this Section. At any
time the Notes of any Class are maintained on Book-Entry Notes, any reference in
this Indenture to an Act of Noteholders or a Noteholder or Noteholders
representing a specified portion of the Outstanding Principal Balance of the
Notes or such Class of Notes shall be deemed to refer to an Act of Note Owners
or a Note Owner or Note Owners holding such specified portion of the Outstanding
Principal Balance of the Notes or Class, as the case may be.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which the Indenture Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or Act by the Noteholder shall bind every Noteholder issued upon the
registration of the related Note, 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.
(e) By accepting the Notes issued pursuant to this Indenture, each
Noteholder irrevocably appoints the Indenture Trustee hereunder as the special
attorney-in-fact for such Noteholder vested with full power on behalf of such
Noteholder to effect and enforce the rights of such Noteholder and the revisions
pursuant hereto for the benefit of such Noteholder; provided that nothing
contained in this Section shall be deemed to confer upon the Indenture Trustee
any duty or power to vote on behalf of the Noteholders with respect to any
matter on which the Noteholders have a right to vote pursuant to the terms of
this Indenture.
SECTION 11.4. Notices, etc., to the Indenture Trustee, Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Noteholders, or other documents provided or permitted by this
Indenture, shall be in writing and, if such request, demand, authorization,
direction, notice, consent, waiver or Act of Noteholders is to be made upon,
given or furnished to or filed with:
(a) the Indenture Trustee by any Noteholder or by the Issuer, shall be
sufficient for every purpose hereunder if made, given, furnished or filed in
writing to or with the Indenture Trustee at its Corporate Trust Office, or
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(b) the Issuer by the Indenture Trustee or by any Noteholder, shall be
sufficient for every purpose hereunder if in writing and mailed, first-class,
postage prepaid, to the Issuer addressed to: GE Equipment Midticket LLC, Series
2007-1, in care of General Electric Capital Corporation, ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Capital Markets Operations, and to General
Electric Capital Corporation, as Administrator, ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: General Counsel, or at any other address previously furnished
in writing to the Indenture Trustee by the Issuer or the Administrator. The
Issuer shall promptly transmit any notice received by it from the Noteholders to
the Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Trustee shall be in writing, personally delivered or
mailed by certified mail, return receipt requested, to their respective
addresses set forth in Section 8.1 of the Servicing Agreement.
SECTION 11.5. Notices to Noteholders; Waiver. Where this Indenture provides
for notice to Noteholders of any event or the mailing of any report to
Noteholders, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class, postage prepaid or
certified mail return receipt requested, or sent by private courier or confirmed
telecopy to each Noteholder affected by such event or to whom such report is
required to be mailed, at its 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 or the mailing of such report. In any case where
notice or report to Noteholders is given by mail, neither the failure to mail
such notice or report nor any defect in any notice or report so mailed to any
particular Noteholder shall affect the sufficiency of such notice or report with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by any Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Noteholders shall be filed with the Indenture Trustee but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such a waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to mail or send notice to Noteholders,
in accordance with Section 11.5, of any event or any report to Noteholders when
such notice or report is required to be delivered pursuant to any provision of
this Indenture, then such notification or delivery as shall be made with the
approval of the Trustee shall constitute a sufficient notification for every
purpose hereunder.
Where this Indenture provides for notice to the Rating Agencies, failure to
give such notice shall not affect any other rights or obligations created
hereunder, and shall not under any circumstance constitute a Default or Event of
Default.
SECTION 11.6. Alternate Payment and Notice Provisions. Notwithstanding any
provision of this Indenture or any of the Notes to the contrary, the Issuer may
enter into any agreement with any Noteholder providing for a method of payment,
or notice by the Indenture Trustee or any Paying Agent to such Noteholder, that
is different from the methods provided for
78
in this Indenture or the Notes for such payments or notices. The Issuer will
furnish to the Indenture Trustee a copy of each such agreement and the Indenture
Trustee will cause payments to be made and notices to be given in accordance
with such agreements.
SECTION 11.7. 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 of the Indenture
Trustee, whether so expressed or not.
SECTION 11.8. Severability. Any provision of this Indenture or the Notes
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or of the
Notes, as applicable, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 11.9. Benefits of Indenture. 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, the Noteholders, the Swap Counterparty,
any other party secured hereunder and any other Person with an ownership
interest in any part of the Collateral, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 11.10. 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 Business Day with the same force and effect as if
made on the date on which nominally due, and no interest shall accrue for the
period from and after any such nominal date.
SECTION 11.11. Governing Law. (a) THIS AGREEMENT AND THE OBLIGATIONS
ARISING HEREUNDER SHALL IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION
5-1401(1) OF THE GENERAL OBLIGATIONS LAW, BUT WITHOUT REGARD TO ANY OTHER
CONFLICT OF LAW PROVISIONS THEREOF) AND ANY APPLICABLE LAWS OF THE UNITED STATES
OF AMERICA. THIS INDENTURE IS SUBJECT TO THE TRUST INDENTURE ACT OF 1939, AS
AMENDED, AND SHALL BE GOVERNED THEREBY AND CONSTRUED IN ACCORDANCE THEREWITH.
(b) EACH PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL
COURTS LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY SHALL HAVE EXCLUSIVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THEM
PERTAINING TO THIS AGREEMENT OR TO ANY MATTER ARISING OUT OF OR RELATING TO THIS
AGREEMENT; PROVIDED, THAT EACH PARTY HERETO ACKNOWLEDGES THAT ANY APPEALS FROM
THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE BOROUGH OF
MANHATTAN IN NEW YORK CITY; PROVIDED, FURTHER, THAT NOTHING IN THIS AGREEMENT
SHALL BE DEEMED
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OR OPERATE TO PRECLUDE THE INDENTURE TRUSTEE FROM BRINGING SUIT OR TAKING OTHER
LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE ISSUER COLLATERAL OR
ANY OTHER SECURITY FOR THE ISSUER OBLIGATIONS SECURED HEREUNDER, OR TO ENFORCE A
JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE INDENTURE TRUSTEE. EACH PARTY
HERETO SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR
SUIT COMMENCED IN ANY SUCH COURT, AND EACH PARTY HERETO HEREBY WAIVES ANY
OBJECTION THAT SUCH PARTY MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION,
IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF
SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT. EACH
PARTY HERETO HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER
PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO SUCH PARTY AT ITS ADDRESS DETERMINED IN ACCORDANCE WITH SECTION
11.4 AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF SUCH
PARTY'S ACTUAL RECEIPT THEREOF OR THREE DAYS AFTER DEPOSIT IN THE UNITED STATES
MAIL, PROPER POSTAGE PREPAID. NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF
ANY PARTY HERETO TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
(c) BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL
TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND
EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY
(RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE
RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE
BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE
PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR
PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 11.12. Counterparts. This Indenture may be executed in any number
of counterparts, each of which when so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 11.13. Recording of Indenture. If this Indenture is subject to
recording in any 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) 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.
80
SECTION 11.14. Trust Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Swap
Counterparty, Managing Member or the Indenture Trustee on the Notes, the Swap
Agreement, or under this Indenture or any certificate or other writing delivered
in connection herewith or therewith, against: (i) the Indenture Trustee or
Managing Member in their individual capacities, (ii) any owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, officer,
director, employee or agent of: (a) the Indenture Trustee or Managing Member in
their individual capacities, (b) any owner of a beneficial interest in the
Issuer, Managing Member or the Indenture Trustee or (c) of any successor or
assign of the Indenture Trustee or Managing Member in their individual
capacities, except as any such Person may have expressly agreed (it being
understood that the Indenture Trustee and Managing Member 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.
SECTION 11.15. Communication by Noteholders with Other Noteholders.
Noteholders may communicate, pursuant to TIA Section 312(b), with other
Noteholders with respect to their rights under this Indenture or the Notes. The
Issuer, the Indenture Trustee, the Note Registrar and all other parties shall be
entitled to rely on and shall have the protection of TIA Section 312(c).
SECTION 11.16. Inspection. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Indenture Trustee, during the
Issuer's normal business hours, to examine all the books of account, records,
reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees and Independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested for the purpose of
reviewing or evaluating the financial condition or affairs of the Issuer or the
performance or compliance with the covenants and undertakings of the Issuer
under this Indenture, the Purchase and Sale Agreement or any of the other
documents referred to herein or therein. The Indenture Trustee shall and shall
cause its representatives to hold in confidence all such information; provided,
however, that the foregoing shall not be construed to prohibit: (i) disclosure
of any and all information that is or becomes publicly known, or information
obtained by the Indenture Trustee from sources other than the Issuer or its
agents, (ii) disclosure of any and all information: (A) if required to do so by
any applicable statute, law, rule or regulation, (B) to any government agency or
regulatory or self-regulatory body having or claiming authority to regulate or
oversee any aspects of the Indenture Trustee's business or that of its
Affiliates, (C) pursuant to any subpoena, civil investigative demand or similar
demand or request of any court, regulatory authority, arbitrator or arbitration
to which the Indenture Trustee or an Affiliate or any officer, director,
employee or shareholder thereof is subject, (D) in any preliminary or final
offering circular or prospectus, registration statement or contract or other
document pertaining to the transactions contemplated by this Indenture and
approved in advance by the Issuer or (E) to any Affiliate, independent or
internal auditor, agent, employee or attorney of the Indenture Trustee having a
need to know the same; provided, that the Indenture Trustee advises such
recipient of the confidential nature of the information being disclosed and such
recipient agrees to keep such information confidential,
81
(iii) any other disclosure authorized by the Issuer or (iv) disclosure to the
other parties to the transactions contemplated by the Related Documents.
SECTION 11.17. Agents of Issuer. The Indenture Trustee hereby acknowledges
that it has been advised that any agent of the Issuer may act on behalf of the
Issuer hereunder for purposes of all consents, amendments, waivers and other
actions permitted or required to be taken, delivered or performed by the Issuer,
and the Indenture Trustee agrees that any such action taken by an agent on
behalf of the Issuer shall satisfy the Issuer's obligations hereunder.
SECTION 11.18. Survival of Representations and Warranties. The
representations, warranties and certificate of the Issuer made in this Indenture
or in any certificate or other writing delivered by the Issuer pursuant hereto
shall survive the authentication and delivery of the Notes hereunder.
SECTION 11.19. Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof that is required to
be included in this Indenture by the TIA, such required provision shall control.
The provisions of TIA Sections 310 through 317 that impose duties on any Person
(including the provisions automatically deemed included herein unless expressly
excluded by this Indenture) are a part of and govern this Indenture, whether or
not physically contained herein.
SECTION 11.20. Subordination. Each Noteholder by accepting a Note
acknowledges and agrees that such Note represents indebtedness of the Issuer and
does not represent an interest in any assets (other than a security interest in
the Collateral) of the Purchaser (including by virtue of any deficiency claim in
respect of obligations not paid or otherwise satisfied from the Collateral and
proceeds thereof). In furtherance of and not in derogation of the foregoing,
each Noteholder by accepting a Note acknowledges and agrees that:
(a) by virtue of its rights under such Note and this Indenture, such
Noteholder shall not have any right, title or interest in or to any assets (or
interests therein) (other than a security interest in the Collateral) conveyed
or purported to be conveyed by the Purchaser to any other Person or Persons
(whether by way of a sale, capital contribution or by virtue of the granting of
a lien) ("Other Assets");
(b) the Notes constitute claims (as defined in Section 101 of the
Bankruptcy Code) solely against the Issuer, which may be satisfied solely from
the Collateral and its proceeds (whether through ordinary liquidation or the
exercise of UCC remedies and other remedies provided herein) and do not
constitute claims against the Issuer or the Purchaser to the extent that the
Collateral and such proceeds are insufficient to repay the Notes (including
interest thereon, whether accrued before or after the filing of a bankruptcy
petition) in full; and
(c) such Noteholder shall not file or join in a filing of a petition with
respect to any bankruptcy reorganization, arrangement, insolvency or liquidation
proceedings, or similar proceedings under any United States Federal or State
bankruptcy or similar law relating to the Purchaser, or cooperate or encourage
others to file such a petition, in each case unless the Noteholders representing
not less than 66-2/3% of the Outstanding Principal Balance of each Class of
Notes that remains Outstanding and holders of any rated securities, rated debt
or other
82
rated investment backed by any Other Assets representing not less than 66-2/3%
of the outstanding principal balance of each class of such securities, debt or
other investment has consented thereto in writing; provided, that the foregoing
shall not in any way limit the Noteholder's rights to pursue any other creditor
rights or remedies that the Noteholders may have for claims against the Issuer.
To the extent that, notwithstanding the agreements and provisions contained
in the preceding sentences of this subsection, any Noteholder either (i) asserts
an interest or claim to, or benefit from, Other Assets, whether asserted against
or through the Purchaser or any other Person owned by the Purchaser, or (ii) is
deemed to have any such interest, claim or benefit in or from Other Assets,
whether by operation of law, legal process, pursuant to applicable provisions of
insolvency laws or otherwise (including by virtue of Section 1111(b) of the
Bankruptcy Code or any successor provision having similar effect under the
Bankruptcy Code), and whether deemed asserted against or through the Purchaser
or any other Person owned by the Purchaser, then each Noteholder by accepting a
Note further acknowledges and agrees that any such interest, claim or benefit in
or from Other Assets is and shall be expressly subordinated to the indefeasible
payment in full of all obligations and liabilities of the Purchaser other than
obligations and liabilities to the Noteholders, including, the payment of
post-petition interest on such other obligations and liabilities. This
subordination agreement shall be deemed a subordination agreement within the
meaning of Section 510(a) of the Bankruptcy Code. Each Noteholder further
acknowledges and agrees that no adequate remedy at law exists for a breach of
this Section 11.20 and the terms of this Section 11.20 may be enforced by an
action for specific performance.
83
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed by their respective officers duly authorized as of the day and
year first above written.
GE EQUIPMENT MIDTICKET LLC,
SERIES 2007-1
BY: CEF EQUIPMENT HOLDING, L.L.C.,
its Managing Member
By:
------------------------------------
Name:
Title:
THE BANK OF NEW YORK,
not in its individual capacity but
solely as Indenture Trustee
By:
------------------------------------
Name:
Title:
EXHIBIT A-1
to Indenture
FORM OF CLASS A [__] NOTES
REGISTERED $______________(1)
No. R-___ CUSIP NO. __________________
Unless this Note is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Issuer or its
agent for registration of transfer, exchange or payment, and any Note issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
GE EQUIPMENT MIDTICKET LLC, SERIES 2007-1
[___]% CLASS A [____] NOTES
GE EQUIPMENT MIDTICKET LLC, SERIES 2007-1, a limited liability company duly
organized and existing under the laws of the State of Delaware (including any
successor, the "Issuer"), for value received, hereby promises to pay to CEDE &
CO., or registered assigns, the principal sum of _________________________
DOLLARS ($___________), payable as set forth in the Indenture; provided,
however, that the entire unpaid principal amount of this Note shall be due and
payable on the earlier of the [___________] Payment Date and the Redemption
Date, if any, pursuant to Section 10.1 of the Indenture. The Issuer will pay
interest on this Note at the rate per annum shown above, on each Payment Date
until the principal of this Note is paid or made available for payment, on the
principal amount of this Note outstanding on the preceding Payment Date (after
giving effect to all payments of principal made on the preceding Payment Date),
subject to certain limitations contained in Section 3.1 of the Indenture.
Interest on this Note will accrue for each Payment Date from the most recent
Payment Date on which interest has been paid to but excluding the then current
Payment Date or, if no interest has yet been paid, from the date hereof.
Interest will be computed on the basis of [the actual number of days in the
Interest Accrual Period and a 360 day year] [a 360-day year of twelve 30-day
----------
(1) Denominations of $1,000 and in greater whole-dollar denominations in excess
thereof.
A-1-1
months]. Such principal of and interest on this Note shall be paid in the manner
specified in the Indenture.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
Unless the certificate of authentication hereon has been executed by the
Indenture Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture referred to on the reverse hereof, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer.
Dated: [____________]
GE EQUIPMENT MIDTICKET LLC,
SERIES 2007-1
By: CEF Equipment Holding, L.L.C.
its Managing Member
By:
------------------------------------
Name:
Title:
A-1-2
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: [____________]
[___________________], not in its individual capacity but solely as
Indenture Trustee.
By:
------------------------------
Authorized Signatory
A-1-3
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its [____]% Class A [____] Notes (herein called the "Class A
[____] Notes" or the "Notes"), all issued under an Indenture dated as of
[____________] (such Indenture, as supplemented or amended, is herein called the
"Indenture"), between the Issuer and [___________________], not in its
individual capacity but solely as trustee (the "Indenture Trustee", which term
includes any successor Indenture Trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights and obligations thereunder of the Issuer, the
Indenture Trustee and the Noteholders. The Notes are subject to all terms of the
Indenture. All terms used in this Note that are not otherwise defined herein and
that are defined in this Indenture shall have the meanings assigned to them in
or pursuant to this Indenture.
The Class A [____] Notes are and will be equally and ratably secured by the
collateral pledged as security therefor as provided in this Indenture.
The Issuer shall pay interest on overdue installments of interest at the
Class A [____] Interest Rate to the extent lawful.
Each Noteholder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer or the Indenture Trustee on the Notes or under the Indenture or
any certificate or other writing delivered in connection therewith, against: (i)
the Indenture Trustee or the Managing Member in their individual capacities,
(ii) any owner of a beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of: (a) the Indenture
Trustee or the Managing Member in their individual capacities, (b) any holder of
a beneficial interest in the Issuer, the Managing Member or the Indenture
Trustee or of (c) any successor or assign of the Indenture Trustee or the
Managing Member in their individual capacities, except as any such Person may
have expressly agreed and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the Note, will be deemed to represent and
warrant that either (i) it is not acquiring and will not hold any Note with the
assets of (a) an "employee benefit plan" (as defined in Section 3(3) of ERISA)
that is subject to Title I of ERISA, (b) a "plan" (as defined in Section
4975(e)(1) of the Code) that is subject to Section 4975 of the Code (c) an
entity that is deemed to hold assets of such employee benefit plan or plan (each
of the foregoing, a "Benefit Plan") or (d) other plan that is subject to any law
that is substantially similar to ERISA or Section 4975 of the Code (ii) its
acquisition and continued holding of the Note will not give rise to a nonexempt
prohibited transaction under ERISA, Section 4975 of the Code, or any
substantially similar applicable law.
It is the intent of the Issuer, the Servicer, the Noteholders and the Note
Owners that, for purposes of Federal and State income tax and any other tax
measured in whole or in part by
A-1-4
income, the Notes will qualify as indebtedness of the Issuer. Each Noteholder or
Note Owner, by acceptance of a Note, or, in the case of a Note Owner, a
beneficial interest in a Note, agrees to treat, and to take no action
inconsistent with the treatment of, the Notes for such tax purposes as
indebtedness of the Issuer.
This Note and the Indenture and the obligations arising hereunder and
thereunder shall in all respects, including all matters of construction,
validity and performance, be governed by, and construed and enforced in
accordance with, the internal laws of the State of New York (including Section
5-1401(1) of the General Obligations Law, but without regard to any other
conflict of laws provisions thereof) and any applicable laws of the United
States of America.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Related Documents, neither [___________________], in its
individual capacity, any owner of a beneficial interest in the Issuer, nor any
of their respective partners, beneficiaries, agents, officers, directors,
employees, successors or assigns shall be personally liable for, nor shall
recourse be had to any of them for, the payment of principal of or interest on,
or performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in this Note or the Indenture, it being expressly
understood that said covenants, obligations and indemnifications have been made
by the Indenture Trustee for the sole purposes of binding the interests of the
Indenture Trustee in the assets of the Issuer. The Noteholder by the acceptance
hereof, and each Note Owner by the acceptance of a beneficial interest herein,
each agrees that, except as expressly provided in the Related Documents, in the
case of an Event of Default under the Indenture, the Noteholder and Note Owner
shall have no claim against any of the foregoing for any deficiency, loss or
claim therefrom; provided, however, that nothing contained herein shall be taken
to prevent recourse to, and enforcement against, the assets of the Issuer for
any and all liabilities, obligations and undertakings contained in the Indenture
or in this Note.
A-1-5
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto _____________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ______________________, attorney, to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: _____________ _______________________________ */
Signature Guaranteed:
-------------------------------------
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee program"
as may be determined by the Note Registrar in addition to, or in substitution
for, STAMP, all in accordance with the Securities Exchange Act of 1934, as
amended.
----------
*/ NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular without alteration, enlargement or any change whatsoever.
A-1-6
EXHIBIT A-2
to Indenture
FORM OF CLASS B NOTES
REGISTERED $______________(2)
No. R-___ CUSIP NO. __________________
Unless this Note is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Issuer or its
agent for registration of transfer, exchange or payment, and any Note issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
GE EQUIPMENT MIDTICKET LLC, SERIES 2007-1
[___]% CLASS B NOTES
GE EQUIPMENT MIDTICKET LLC, SERIES 2007-1, a limited liability company duly
organized and existing under the laws of the State of Delaware (including any
successor, the "Issuer"), for value received, hereby promises to pay to CEDE &
CO., or registered assigns, the principal sum of _________________________
DOLLARS ($___________), payable as set forth in the Indenture; provided,
however, that the entire unpaid principal amount of this Note shall be due and
payable on the earlier of the [____________] Payment Date and the Redemption
Date, if any, pursuant to Section 10.1 of the Indenture. The Issuer will pay
interest on this Note at the rate per annum shown above, on each Payment Date
until the principal of this Note is paid or made available for payment, on the
principal amount of this Note outstanding on the preceding Payment Date (after
giving effect to all payments of principal made on the preceding Payment Date),
subject to certain limitations contained in Section 3.1 of the Indenture.
Interest on this Note will accrue for each Payment Date from the most recent
Payment Date on which interest has been paid to but excluding the then current
Payment Date or, if no interest has yet been paid, from the date hereof.
Interest will be computed on the basis of the actual number
----------
(2) Denominations of $1,000 and in greater whole-dollar denominations in excess
thereof.
A-2-1
of days in the Interest Accrual Period and a 360 day year. Such principal of and
interest on this Note shall be paid in the manner specified in the Indenture.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
Unless the certificate of authentication hereon has been executed by the
Indenture Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture referred to on the reverse hereof, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer.
Dated: [____________]
GE EQUIPMENT MIDTICKET LLC,
SERIES 2007-1
By: CEF Equipment Holding, L.L.C.
its Managing Member
By:
------------------------------------
Name:
Title:
A-2-2
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: [____________]
[___________________], not in its
individual capacity but solely as
Indenture Trustee
By:
-------------------------------------
Authorized Signatory
A-2-3
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its [___]% Class B Notes (herein called the "B Notes" or the
"Notes"), all issued under an Indenture dated as of [____________] (such
Indenture, as supplemented or amended, is herein called the "Indenture"),
between the Issuer and [___________________], not in its individual capacity but
solely as trustee (the "Indenture Trustee", which term includes any successor
Indenture Trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights and obligations thereunder of the Issuer, the Indenture Trustee and the
Noteholders. The Notes are subject to all terms of the Indenture. All terms used
in this Note that are not otherwise defined herein and that are defined in the
Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
Class B Notes are and will be equally and ratably secured by the collateral
pledged as security therefor as provided in the Indenture and are subordinated
to the Class A Notes to the extent provided in the Indenture.
The Issuer shall pay interest on overdue installments of interest at the
Class B Interest Rate to the extent lawful.
Each Noteholder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer or the Indenture Trustee on the Notes or under the Indenture or
any certificate or other writing delivered in connection therewith, against: (i)
the Indenture Trustee or the Managing Member in their individual capacities,
(ii) any owner of a beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of: (a) the Indenture
Trustee or the Managing Member in their individual capacities, (b) any holder of
a beneficial interest in the Issuer, the Managing Member or the Indenture
Trustee or of (c) any successor or assign of the Indenture Trustee or the
Managing Member in their individual capacities, except as any such Person may
have expressly agreed and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the Note, will be deemed to represent and
warrant that either (i) it is not acquiring and will not hold any Note with the
assets of (a) an "employee benefit plan" (as defined in Section 3(3) of ERISA)
that is subject to Title I of ERISA, (b) a "plan" (as defined in Section
4975(e)(1) of the Code) that is subject to Section 4975 of the Code, (c) an
entity that is deemed to hold assets of such employee benefit plan or plan (each
of the foregoing, a "Benefit Plan") or (d) other plan that is subject to any law
substantially similar to ERISA or Section 4975 of the Code (ii) its acquisition
and continued holding of the Note will not give rise to a nonexempt prohibited
transaction under ERISA, Section 4975 of the Code, or any substantially similar
applicable law.
It is the intent of the Issuer, the Servicer, the Noteholders and the Note
Owners that, for purposes of Federal and State income tax and any other tax
measured in whole or in part by
A-2-4
income, the Notes will qualify as indebtedness of the Issuer. Each Noteholder or
Note Owner, by acceptance of a Note, or, in the case of a Note Owner, a
beneficial interest in a Note, agrees to treat, and to take no action
inconsistent with the treatment of, the Notes for such tax purposes as
indebtedness of the Issuer.
This Note and the Indenture and the obligations arising hereunder and
thereunder shall in all respects, including all matters of construction,
validity and performance, be governed by, and construed and enforced in
accordance with, the internal laws of the State of New York (including Section
5-1401(1) of the General Obligations Law, but without regard to any other
conflict of laws provisions thereof) and any applicable laws of the United
States of America.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Related Documents, neither [___________________], in its
individual capacity, any owner of a beneficial interest in the Issuer, nor any
of their respective partners, beneficiaries, agents, officers, directors,
employees, successors or assigns shall be personally liable for, nor shall
recourse be had to any of them for, the payment of principal of or interest on,
or performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in this Note or the Indenture, it being expressly
understood that said covenants, obligations and indemnifications have been made
by the Indenture Trustee for the sole purposes of binding the interests of the
Indenture Trustee in the assets of the Issuer. The Noteholder, by the acceptance
hereof, and each Note Owner by the acceptance of a beneficial interest herein,
each agrees that, except as expressly provided in the Related Documents, in the
case of an Event of Default under the Indenture, the Noteholder and Note Owner
shall have no claim against any of the foregoing for any deficiency, loss or
claim therefrom; provided, however, that nothing contained herein shall be taken
to prevent recourse to, and enforcement against, the assets of the Issuer for
any and all liabilities, obligations and undertakings contained in the Indenture
or in this Note.
A-2-5
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ______________________, attorney, to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: _____________ _______________________________ *
Signature Guaranteed:
-------------------------------------
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee program"
as may be determined by the Note Registrar in addition to, or in substitution
for, STAMP, all in accordance with the Securities Exchange Act of 1934, as
amended.
----------
* NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular without alteration, enlargement or any change whatsoever.
A-2-6
EXHIBIT A-3
to Indenture
FORM OF CLASS C NOTES
REGISTERED $______________(3)
No. R-___ CUSIP NO. __________________
Unless this Note is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Issuer or its
agent for registration of transfer, exchange or payment, and any Note issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
GE EQUIPMENT MIDTICKET LLC, SERIES 2007-1
[___]% CLASS C NOTES
GE EQUIPMENT MIDTICKET LLC, SERIES 2007-1, a limited liability company duly
organized and existing under the laws of the State of Delaware (including any
successor, the "Issuer"), for value received, hereby promises to pay to CEDE &
CO., or registered assigns, the principal sum of _________________________
DOLLARS ($___________), payable as set forth in the Indenture; provided, that
the entire unpaid principal amount of this Note shall be due and payable on the
earlier of the [____________] Payment Date and the Redemption Date, if any,
pursuant to Section 10.1 of the Indenture. The Issuer will pay interest on this
Note at the rate per annum shown above, on each Payment Date until the principal
of this Note is paid or made available for payment, on the principal amount of
this Note outstanding on the preceding Payment Date (after giving effect to all
payments of principal made on the preceding Payment Date), subject to certain
limitations contained in Section 3.1 of the Indenture. Interest on this Note
will accrue for each Payment Date from the most recent Payment Date on which
interest has been paid to but excluding the then current Payment Date or, if no
interest has yet been paid, from the date hereof. Interest will be computed on
the basis of the actual number of days in the
----------
(3) Denominations of $1,000 and in greater whole-dollar denominations in excess
thereof.
A-3-1
Interest Accrual Period and a 360 day year. Such principal of and interest on
this Note shall be paid in the manner specified in the Indenture.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
Unless the certificate of authentication hereon has been executed by the
Indenture Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture referred to on the reverse hereof, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer.
Dated: [____________]
GE EQUIPMENT MIDTICKET LLC,
SERIES 2007-1
By: CEF Equipment Holding, L.L.C.
its Managing Member
By:
------------------------------------
Name:
Title:
A-3-2
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Dated: [____________]
[___________________], not in its
individual capacity but solely as
Indenture Trustee
By:
------------------------------------
Authorized Signatory
A-3-3
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its [___]% Class C Notes (herein called the "C Notes" or the
"Notes"), all issued under an Indenture dated as of [____________] (such
Indenture, as supplemented or amended, is herein called the "Indenture"),
between the Issuer and [___________________], not in its individual capacity but
solely as trustee (the "Indenture Trustee", which term includes any successor
Indenture Trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights and obligations thereunder of the Issuer, the Indenture Trustee and the
Noteholders. The Notes are subject to all terms of the Indenture. All terms used
in this Note that are not otherwise defined herein and that are defined in the
Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
Class C Notes are and will be equally and ratably secured by the collateral
pledged as security therefor as provided in the Indenture and are subordinated
to the Class A Notes and the Class B Notes to the extent provided in the
Indenture.
The Issuer shall pay interest on overdue installments of interest at the
Class C Interest Rate to the extent lawful.
Each Noteholder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer or the Indenture Trustee on the Notes or under the Indenture or
any certificate or other writing delivered in connection therewith, against: (i)
the Indenture Trustee or the Managing Member in their individual capacities,
(ii) any owner of a beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of: (a) the Indenture
Trustee or the Managing Member in their individual capacities, (b) any holder of
a beneficial interest in the Issuer, the Managing Member or the Indenture
Trustee or of (c) any successor or assign of the Indenture Trustee or the
Managing Member in their individual capacities, except as any such Person may
have expressly agreed and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the Note, will be deemed to represent and
warrant that either (i) it is not acquiring and will not hold any Note with the
assets of (a) an "employee benefit plan" (as defined in Section 3(3) of ERISA)
that is subject to Title I of ERISA, (b) a "plan" (as defined in Section
4975(e)(1) of the Code) that is subject to Section 4975 of the Code, (c) an
entity that is deemed to hold assets of such employee benefit plan or plan (each
of the foregoing, a "Benefit Plan") or (d) other plan that is subject to any law
that is substantially similar to ERISA or Section 4975 of the Code (ii) its
acquisition and continued holding of the Note will not give rise to a nonexempt
prohibited transaction under ERISA, Section 4975 of the Code, or any
substantially similar applicable law.
It is the intent of the Issuer, the Servicer, the Noteholders and the Note
Owners that, for purposes of federal and State income tax and any other tax
measured in whole or in part by
A-3-4
income, the Notes will qualify as indebtedness of the Issuer. Each Noteholder or
Note Owner, by acceptance of a Note, or, in the case of a Note Owner, a
beneficial interest in a Note, agrees to treat, and to take no action
inconsistent with the treatment of, the Notes for such tax purposes as
indebtedness of the Issuer.
This Note and the Indenture and the obligations arising hereunder and
thereunder shall in all respects, including all matters of construction,
validity and performance, be governed by, and construed and enforced in
accordance with, the internal laws of the State of New York (including Section
5-1401(1) of the General Obligations Law, but without regard to any other
conflict of laws provisions thereof) and any applicable laws of the United
States of America.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Related Documents, neither [___________________], in its
individual capacity, any owner of a beneficial interest in the Issuer, nor any
of their respective partners, beneficiaries, agents, officers, directors,
employees, successors or assigns shall be personally liable for, nor shall
recourse be had to any of them for, the payment of principal of or interest on,
or performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in this Note or the Indenture, it being expressly
understood that said covenants, obligations and indemnifications have been made
by the Indenture Trustee for the sole purposes of binding the interests of the
Indenture Trustee in the assets of the Issuer. The Noteholder, by the acceptance
hereof, and each Note Owner by the acceptance of a beneficial interest herein,
each agrees that, except as expressly provided in the Related Documents, in the
case of an Event of Default under the Indenture, the Noteholder and Note Owner
shall have no claim against any of the foregoing for any deficiency, loss or
claim therefrom; provided, that nothing contained herein shall be taken to
prevent recourse to, and enforcement against, the assets of the Issuer for any
and all liabilities, obligations and undertakings contained in the Indenture or
in this Note.
A-3-5
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ______________________, attorney, to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: _____________ _______________________________ *
Signature Guaranteed:
----------------------------------------
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee program"
as may be determined by the Note Registrar in addition to, or in substitution
for, STAMP, all in accordance with the Securities Exchange Act of 1934, as
amended.
----------
* NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular without alteration, enlargement or any change whatsoever.
A-3-6
EXHIBIT B
to Indenture
FORM OF SECTION 3.9 OFFICERS' CERTIFICATE
_____________, _____
[__________________]
[______________________]
[______________________]
Attention: [___________________]
Pursuant to Section 3.9 of the Indenture, dated as of [__________] (the
"Indenture"), between GE EQUIPMENT MIDTICKET LLC, SERIES 2007-1 (the "Issuer")
and THE BANK OF NEW YORK, as Indenture Trustee, the undersigned hereby certifes
that:
(i) a review of the activities of the Issuer during the previous
fiscal year and of performance under the Indenture has been made under
the supervision of the undersigned; and
(ii) to the best knowledge of the undersigned, based on such
review, the Issuer has complied with all conditions and covenants
under the Indenture throughout such year. [or, if there has been a
default in the compliance of any such condition or covenant, this
certificate is to specify each such default known to the undersigned
and the nature and status thereof]
GE EQUIPMENT MIDTICKET LLC,
SERIES 2007-1
By: CEF Equipment Holding, L.L.C.
its Managing Member
By:
------------------------------------
Name:
Title:
B-1
EXHIBIT C
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by the Indenture Trustee shall
address, at a minimum, the criteria identified as below as "Applicable Servicing
Criteria":
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
-----------------------------------------------------------------------------------------------------------------------------
REFERENCE CRITERIA
GENERAL SERVICING CONSIDERATIONS
1122(d)(1)(i) Policies and procedures are instituted to monitor any performance or other
triggers and events of default in accordance with the transaction agreements.
1122(d)(1)(ii) If any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party's
performance and compliance with such servicing activities.
1122(d)(1)(iii) Any requirements in the transaction agreements to maintain a back-up servicer
for the pool assets are maintained.
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in effect on the party
participating in the servicing function throughout the reporting period in
the amount of coverage required by and otherwise in accordance with the terms
of the transaction agreements.
CASH COLLECTION AND ADMINISTRATION
1122(d)(2)(i) Payments on pool assets are deposited into the appropriate custodial bank
accounts and related bank clearing accounts no more than two business days
following receipt, or such other number of days specified in the transaction
agreements.
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an obligor or to an [X]
investor are made only by authorized personnel.
1122(d)(2)(iii) Advances of funds or guarantees regarding collections, cash flows or
distributions, and any interest or other fees charged for such advances, are
made, reviewed and approved as specified in the transaction agreements.
1122(d)(2)(iv) The related accounts for the transaction, such as cash reserve accounts or [X]
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth in the
transaction agreements.
1122(d)(2)(v) Each custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes of this
criterion, "federally insured depository institution" with respect to a
foreign financial institution means a foreign financial institution that
meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange Act.
C-1
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
-----------------------------------------------------------------------------------------------------------------------------
REFERENCE CRITERIA
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent unauthorized access.
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for all asset-backed
securities related bank accounts, including custodial accounts and related
bank clearing accounts. These reconciliations are (A) mathematically
accurate; (B) prepared within 30 calendar days after the bank statement
cutoff date, or such other number of days specified in the transaction
agreements; (C) reviewed and approved by someone other than the person who
prepared the reconciliation; and (D) contain explanations for reconciling
items. These reconciling items are resolved within 90 calendar days of their
original identification, or such other number of days specified in the
transaction agreements.
INVESTOR REMITTANCES AND REPORTING
1122(d)(3)(i) Reports to investors, including those to be filed with the Commission, are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with the terms
specified in the transaction agreements; (C) are filed with the Commission as
required by its rules and regulations; and (D) agree with investors' or the
trustee's records as to the total unpaid principal balance and number of pool
assets serviced by the Servicer.
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in accordance with [X]
timeframes, distribution priority and other terms set forth in the
transaction agreements.
1122(d)(3)(iii) Disbursements made to an investor are posted within two business days to the
Servicer's investor records, or such other number of days specified in the
transaction agreements.
1122(d)(3)(iv) Amounts remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank statements.
POOL ASSET ADMINISTRATION
1122(d)(4)(i) Collateral or security on pool assets is maintained as required by the
transaction agreements or related asset pool documents.
1122(d)(4)(ii) Pool assets and related documents are safeguarded as required by the
transaction agreements.
1122(d)(4)(iii) Any additions, removals or substitutions to the asset pool are made, reviewed
and approved in accordance with any conditions or requirements in the
transaction agreements.
1122(d)(4)(iv) Payments on pool assets, including any payoffs, made in accordance with the
related pool asset documents are posted
C-2
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
-----------------------------------------------------------------------------------------------------------------------------
REFERENCE CRITERIA
to the Servicer's obligor records maintained no more than two business days
after receipt, or such other number of days specified in the transaction
agreements, and allocated to principal, interest or other items (e.g.,
escrow) in accordance with the related asset pool documents.
1122(d)(4)(v) The Servicer's records regarding the pool assets agree with the Servicer's
records with respect to an obligor's unpaid principal balance.
1122(d)(4)(vi) Changes with respect to the terms or status of an obligor's account (e.g.,
loan modifications or re-agings) are made, reviewed and approved by
authorized personnel in accordance with the transaction agreements and
related pool asset documents.
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forbearance plans, modifications
and deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance with the
timeframes or other requirements established by the transaction agreements.
1122(d)(4)(viii) Records documenting collection efforts are maintained during the period a
pool asset is delinquent in accordance with the transaction agreements. Such
records are maintained on at least a monthly basis, or such other period
specified in the transaction agreements, and describe the entity's activities
in monitoring delinquent pool assets including, for example, phone calls,
letters and payment rescheduling plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).
1122(d)(4)(ix) Adjustments to interest rates or rates of return for pool assets with
variable rates are computed based on the related pool asset documents.
1122(d)(4)(x) Regarding any funds held in trust for an obligor (such as escrow accounts):
(A) such funds are analyzed, in accordance with the obligor's pool asset
documents, on at least an annual basis, or such other period specified in the
transaction agreements; (B) interest on such funds is paid, or credited, to
obligors in accordance with applicable pool asset documents and state laws;
and (C) such funds are returned to the obligor within 30 calendar days of
full repayment of the related pool assets, or such other number of days
specified in the transaction agreements.
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or insurance payments) are
made on or before the related penalty or expiration dates, as indicated on
the appropriate bills or notices for such payments, provided that such
support has been received by the servicer at least 30 calendar days prior to
these dates, or such other number of days specified in the transaction
agreements.
C-3
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
-----------------------------------------------------------------------------------------------------------------------------
REFERENCE CRITERIA
1122(d)(4)(xii) Any late payment penalties in connection with any payment to be made on
behalf of an obligor are paid from the servicer's funds and not charged to
the obligor, unless the late payment was due to the obligor's error or
omission.
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted within two business
days to the obligor's records maintained by the servicer, or such other
number of days specified in the transaction agreements.
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are recognized and
recorded in accordance with the transaction agreements.
1122(d)(4)(xv) Any external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set forth in the
transaction agreements.
C-4
EXHIBIT D
FORM OF ANNUAL CERTIFICATION OF THE INDENTURE TRUSTEE
Re: GE Equipment Midticket LLC, Series 2007-1
Dated:___________________
The Bank of New York, not in its individual capacity but solely as
indenture trustee (the "Indenture Trustee"), certifies to CEF Equipment Holding,
L.L.C. (the "Purchaser"), its officers and GE Equipment Midticket LLC, Series
2007-1 (the "Issuer"), with the knowledge and intent that they will rely upon
this certification, that:
(1) It has reviewed the report on assessment of the Indenture Trustee's
compliance provided in accordance with Rules 13a-18 and 15d-18 under the
Securities Exchange Act of 1934, as amended (the "Securities Exchange Act") and
Item 1122 of Regulation AB (the "Servicing Assessment"), and the registered
public accounting firm's attestation report provided in accordance with Rules
13a-18 and 15d-18 under the Securities Exchange Act and Section 1122(b) of
Regulation AB (the "Attestation Report") that were delivered by the Indenture
Trustee to the Purchaser pursuant to the Indenture dated as of November [_],
2007 (as amended, supplemented or otherwise modified from time to time, the
"Indenture"), by and between the Issuer and the Indenture Trustee (collectively,
the "Indenture Trustee Information") (in making such statement, the Indenture
Trustee makes no representation or warranty as to any information prepared or
provided to it by a third person and upon which it relied in preparing our
information);
(2) To the best of its knowledge, the Indenture Trustee Information, taken
as a whole, does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in the light of the
circumstances under which such statements were made, not misleading with respect
to the period of time covered by the Indenture Trustee Information; and
(3) To the best of its knowledge, all of the Indenture Trustee Information
required to be provided by the Indenture Trustee under the Indenture has been
provided to the Purchaser.
THE BANK OF NEW YORK, as Indenture Trustee
By:
--------------------------------------
Name:
Title:
D-1
EXHIBIT E
to Indenture
Form of Noteholder's Statement Pursuant to Section 8.5
Payment Date:
AMOUNT OF PRINCIPAL BEING PAID ON NOTES:
Class A-1 Notes: ($_______ per $1,000 original principal amount)
Class A-2a Notes: ($_______ per $1,000 original principal amount)
Class A-2b Notes: ($_______ per $1,000 original principal amount)
Class A-3a Notes: ($_______ per $1,000 original principal amount)
Class A-3b Notes: ($_______ per $1,000 original principal amount)
Class A-4 Notes: ($_______ per $1,000 original principal amount)
Class B Notes: ($_______ per $1,000 original principal amount)
Class C Notes: ($_______ per $1,000 original principal amount)
AMOUNT OF INTEREST BEING PAID IN NOTES:
Class A-1 Notes: ($_______ per $1,000 original principal amount)
Class A-2a Notes: ($_______ per $1,000 original principal amount)
Class A-2b Notes: ($_______ per $1,000 original principal amount)
Class A-3a Notes: ($_______ per $1,000 original principal amount)
Class A-3b Notes: ($_______ per $1,000 original principal amount)
Class A-4 Notes: ($_______ per $1,000 original principal amount)
Class B Notes: ($_______ per $1,000 original principal amount)
Class C Notes: ($_______ per $1,000 original principal amount)
POOL BALANCE AT END OF THE PRECEDING COLLECTION PERIOD:
E-1
AFTER GIVING EFFECT TO DISTRIBUTIONS ON THIS PAYMENT DATE:
(1) Outstanding Principal Balance of Class A-1 Notes:
(2) Outstanding Principal Balance of Class A-2a Notes:
(3) Outstanding Principal Balance of Class A-2b Notes:
(4) Outstanding Principal Balance of Class A-3a Notes:
(5) Outstanding Principal Balance of Class A-3b Notes:
(6) Outstanding Principal Balance of Class A-4 Notes:
(7) Outstanding Principal Balance of Class B Notes:
(8) Outstanding Principal Balance of Class C Notes:
(9) Class A-1 Note Pool Factor:
(10) Class A-2a Note Pool Factor:
(11) Class A-2b Note Pool Factor:
(12) Class A-3a Note Pool Factor:
(13) Class A-3b Note Pool Factor:
(14) Class A-4 Note Pool Factor:
(15) Class B Note Pool Factor:
(16) Class C Note Pool Factor:
(ii) Amount of Servicing Fee: ($_______ per $1,000 original principal amount)
(iii) Amount of Servicer Advances: ($_______ per $1,000 original principal
amount)
(iv) Amount of Administration Fee: ($_______ per $1,000 original principal
amount)
(v) Amount of other fees and expenses paid ($____) [Disclose identity of
party receiving such fees and expenses];
(vi) Aggregate amount of outstanding principal balance of Loans that become
Liquidated Loans for the Collection Period;
(vii) Aggregate amount of the portion of the outstanding principal balance of
Loans written off in respect of Loans that became Defaulted Loans for
such Collection Period;
E-2
(viii) Aggregate Loan Value of Loans that became Defaulted Loans for the
Collection Period;
(ix) Aggregate Purchase Amounts for the Collection Period;
(x) Aggregate amount of outstanding principal balance of Loans that became
Delinquent Loans for the Collection Period;
(xi) Aggregate amount of Recoveries for the Collection Period;
(xii) Aggregate amount of Liquidation Proceeds for the Collection Period; and
(xiii) Material breaches of Loan representations or warranties or covenants in
the Related Documents.
Attention: [________________________]
E-3
SCHEDULE 1
to Indenture
PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS
In addition to the representations, warranties and covenants contained in the
Indenture, to induce the Indenture Trustee to enter into the Indenture, the
Issuer hereby represents, warrants, and covenants to Indenture Trustee on behalf
of the Noteholders as to itself as follows, on the Closing Date:
General
1. The Indenture creates a valid and continuing security interest (as
defined in the applicable UCC) in the Collateral in favor of the Indenture
Trustee, which security interest is prior to all other Liens, and is enforceable
as such as against creditors of and purchasers from the Issuer.
2. The Loans constitute "accounts," "general intangibles," "instruments,"
or "tangible chattel paper," within the meaning of the UCC as in effect in the
State of New York.
3. The Issuer has taken all steps necessary to perfect its security
interest against the Purchaser in the property securing the Loans that
constitute chattel paper.
Creation
4. The Issuer owns and has good and marketable title to the Loans free and
clear of any Lien, claim or encumbrance of any Person, excepting only liens for
taxes, assessments or similar governmental charges or levies incurred in the
ordinary course of business that are not yet due and payable or as to which any
applicable grace period shall not have expired, or that are being contested in
good faith by proper proceedings and for which adequate reserves have been
established, but only so long as foreclosure with respect to such a lien is not
imminent and the use and value of the property to which the Lien attaches is not
impaired during the pendency of such proceeding.
Perfection
5. The Issuer has caused or will have caused, within ten days after the
effective date of the Indenture, the filing of all appropriate financing
statements in the proper filing office in the appropriate jurisdictions under
applicable law in order to perfect the sale of the Loans from Purchaser to the
Issuer, and the security interest in the Loans granted to the Indenture Trustee
hereunder and all financing statements referred to in this paragraph contain a
statement that: "A purchase of or security interest in any collateral described
in this financing statement will violate the rights of the Indenture Trustee.".
6. With respect to Loans that constitute an instrument or tangible chattel
paper, either:
SCHEDULE 1
1
(a) Such instruments or tangible chattel paper are in the possession
of a custodian and the Indenture Trustee has received a written
acknowledgment from the custodian that the custodian is holding such
instruments or tangible chattel paper to effect the Indenture Trustee's
security interest therein; or
(b) A custodian received possession of such instruments or tangible
chattel paper after the Indenture Trustee received a written
acknowledgment from such custodian that such custodian is acting to effect
the Indenture Trustee's security interest therein.
7. With respect to the Trust Accounts and all subaccounts that constitute
deposit accounts the Issuer has delivered to the Indenture Trustee a fully
executed agreement pursuant to which the bank maintaining the deposit accounts
has agreed to comply with all instructions originated by the Indenture Trustee
directing disposition of the funds in the Trust Accounts without further consent
by the Issuer.
Priority
8. Other than the transfer of the Loans to the Issuer under the Purchase
and Sale Agreement and the security interest granted to the Indenture Trustee
pursuant to the Indenture, neither the Issuer nor the Purchaser has pledged,
assigned, sold, granted a security interest in, or otherwise conveyed any of the
Loans or the Trust Accounts or any subaccount thereof. Neither the Issuer nor
the Purchaser has authorized the filing of, or is aware of any financing
statements against the Issuer or the Purchaser that include a description of
collateral covering the Loans or the Trust Accounts or any subaccount thereof
other than any financing statement relating to the security interest granted to
the Indenture Trustee hereunder or that has been terminated.
9. Survival of Perfection Representations. Notwithstanding any other
provision of the Indenture or any other Related Document, the Perfection
Representations contained in this Schedule shall be continuing, and remain in
full force and effect until such time as all Notes under the Indenture have been
finally and fully paid and performed.
10. No Waiver. The parties to the Indenture: (i) shall not, without
obtaining a confirmation of the then-current rating of the Notes, waive any of
the Perfection Representations; (ii) shall provide the Ratings Agencies with
prompt written notice of any breach of the Perfection Representations, and (iii)
shall not, without obtaining a confirmation of the then-current rating of the
Notes (as determined after any adjustment or withdrawal of the ratings following
notice of such breach) waive a breach of any of the Perfection Representations.
11. Issuer to Maintain Perfection and Priority. The Issuer covenants that,
in order to evidence the interests of the Issuer and the Indenture Trustee under
this Agreement, the Issuer shall or shall cause the Servicer to, take such
action, or execute and deliver such instruments (other than effecting a Filing
(as defined below), unless such Filing is effected in accordance with this
paragraph) as may be necessary or advisable (including, without limitation, such
actions as are requested by the Indenture Trustee) to maintain and perfect, as a
first priority interest, the Indenture Trustee's security interest in the
Collateral. The Issuer shall cause the Servicer to, from time to time and within
the time limits established by law, prepare and present to the Indenture Trustee
for the Indenture Trustee to authorize (based in reliance on the Opinion
SCHEDULE 1
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of Counsel hereinafter provided for) the Servicer to file all financing
statements, amendments, continuations, initial financing statements in lieu of a
continuation statement, terminations, partial terminations, releases or partial
releases, or any other filings necessary or advisable to continue, maintain and
perfect the Indenture Trustee's security interest in the Collateral as a
first-priority interest (each a "Filing"). The Issuer shall cause the Servicer
to, present each such Filing to the Indenture Trustee together with (x) an
Opinion of Counsel to the effect that such Filing is (i) consistent with grant
of the security interest to the Indenture Trustee pursuant to the Granting
Clause of this Indenture, (ii) satisfies all requirements and conditions to such
Filing in this Indenture and (iii) satisfies the requirements for a Filing of
such type under the Uniform Commercial Code in the applicable jurisdiction (or
if the Uniform Commercial Code does not apply, the applicable statute governing
the perfection of security interests), and (y) a form of authorization for the
Issuer's signature authorizing the Servicer to effect such Filing under the
Uniform Commercial Code without the signature of the Issuer where allowed by
applicable law.
SCHEDULE 1
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