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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 15, 1996
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
(Exact name of registrant as specified in its charter)
Delaware 333-08645-01 13-7097632
(State or other jurisdiction (Commission (IRS employer
of incorporation) file number) identification No.)
44 Whippany Road, Morristown, NJ 07962
(Address of principal executive offices)
Registrant's telephone number, including area code: (302) 658-7581
1209 Orange Street, Wilmington, DE 19801
(Former name or former address, if changed since last report)
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Item 1. CHANGES IN CONTROL OF REGISTRANT.
Not applicable.
Item 2. ACQUISITION OR DISPOSITION OF ASSETS.
Not applicable.
Item 3. BANKRUPTCY OR RECEIVERSHIP.
Not applicable.
Item 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
Not applicable.
Item 5. OTHER EVENTS.
On October 15, 1996 the Registrant sold $3,057,720,000 of
Equipment Receivable-Backed Notes (the "Notes"), secured by,
among other items, a pool of equipment leases, installment sales
contracts, promissory notes, loan and security agreements and
similar types of receivables (collectively, the "Contracts").
Item 6. RESIGNATIONS OF REGISTRANT'S DIRECTORS.
Not applicable.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial statements of businesses acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
The following is filed herewith. The exhibit numbers
correspond with Item 601(b) of Regulation S-K.
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Exhibit No. Description
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4.1 Transfer and Servicing Agreement, dated as of
October 1, 1996, among Antigua Funding
Corporation, AT&T Capital Leasing Services,
Inc., AT&T Credit Corporation, NCR Credit
Corp., AT&T Commercial Finance Corporation
and AT&T Capital Corporation.
4.2 Indenture, dated as of October 1, 1996,
between The Bank of New York as Owner Trustee
and The Chase Manhattan Bank as Indenture
Trustee.
4.3 Amended and Restated Trust Agreement, dated
as of October 1, 1996, between Antigua
Funding Corporation and The Bank of New York,
as Owner Trustee.
4.5 Purchase and Sale Agreement, dated as of
October 1, 1996, among Antigua Funding
Corporation, AT&T Capital Leasing Services,
Inc., AT&T Credit Corporation, NCR Credit
Corp., AT&T Commercial Finance Corporation
and AT&T Capital Corporation.
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this Report to be signed on its behalf by
the undersigned hereunto duly authorized.
CAPITA EQUIPMENT RECEIVABLES
TRUST 1996-1
Dated: October 15, 1996 By: ANTIGUA FUNDING CORPORATION
as depositor of Capita Equipment
Receivables Trust 1996-1
By: /S/ Madelyn C. Law
------------------------------------
Madelyn C. Law
Vice President and Assistant
Secretary
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INDEX TO EXHIBITS
Exhibit
Number Page
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4.1 Transfer and Servicing Agreement, dated as of October 1, 1996,
among Antigua Funding Corporation, AT&T Capital Leasing Services,
Inc., AT&T Credit Corporation, NCR Credit Corp., AT&T Commercial
Finance Corporation and AT&T Capital Corporation.
4.2 Indenture, dated as of October 1, 1996, between The Bank of New
York as Owner Trustee and The Chase Manhattan Bank as Indenture
Trustee.
4.3 Amended and Restated Trust Agreement, dated as of October 1,
1996, between Antigua Funding Corporation and The Bank of New
York, as Owner Trustee.
4.5 Purchase and Sale Agreement, dated as of October 1, 1996, among
Antigua Funding Corporation, AT&T Capital Leasing Services, Inc.,
AT&T Credit Corporation, NCR Credit Corp., AT&T Commercial
Finance Corporation and AT&T Capital Corporation.
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Exhibit 4.1
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TRANSFER AND SERVICING AGREEMENT
AMONG
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
ISSUER
ANTIGUA FUNDING CORPORATION
DEPOSITOR
AT&T CAPITAL CORPORATION
IN ITS INDIVIDUAL CAPACITY AND AS SERVICER
THE CHASE MANHATTAN BANK
INDENTURE TRUSTEE
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DATED AS OF OCTOBER 1, 1996
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TABLE OF CONTENTS
PAGE
INTRODUCTION 1
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.1. Definitions . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.2. Usage of Terms . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.3. Calculations . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.4. Section References . . . . . . . . . . . . . . . . . . . 10
SECTION 1.5. No Recourse . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE II CONVEYANCE OF CONTRACTS . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.1. Conveyance of Contracts and Related Assets . . . . . . . 11
SECTION 2.2. Custody of Contract Files . . . . . . . . . . . . . . . 12
SECTION 2.3. Further Assurances . . . . . . . . . . . . . . . . . . . 14
SECTION 2.4. Representations and Warranties of Depositor . . . . . . 14
SECTION 2.5. Nonpetition Covenant . . . . . . . . . . . . . . . . . . 17
SECTION 2.6. Purchase of Contracts Upon Breach of Representations
and Warranties . . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE III ADMINISTRATION AND SERVICING OF CONTRACTS . . . . . . . . . . . 19
SECTION 3.1. Duties of the Servicer . . . . . . . . . . . . . . . . . 19
SECTION 3.2. Collection of Contract Payments; Modifications of
Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.3. Realization Upon Contracts . . . . . . . . . . . . . . . 22
SECTION 3.4. Insurance, Maintenance and Taxes . . . . . . . . . . . . 23
SECTION 3.5. Maintenance of Security Interests in Equipment . . . . . 26
SECTION 3.6. Covenants, Representations, and Warranties of
Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 3.7. Sub-Servicers . . . . . . . . . . . . . . . . . . . . . 28
SECTION 3.8. Total Servicing Fee; Payment of Expenses by Servicer . . 28
SECTION 3.9. Servicer's Certificate . . . . . . . . . . . . . . . . . 29
SECTION 3.10. Annual Statement as to Compliance; Notice of Servicer
Termination Event . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.11. Annual Independent Accountants' Report . . . . . . . . . 30
SECTION 3.12. Access to Certain Documentation and Information
Regarding Contracts . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 3.13. Certain Duties of the Servicer under the Trust
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 3.14. Duties of the Servicer under the Indenture . . . . . . . 32
SECTION 3.15. Fidelity Bond . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE IV COLLECTIONS AND DEPOSITS . . . . . . . . . . . . . . . . . . . 34
SECTION 4.1. Initial Deposit . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.2. Collections . . . . . . . . . . . . . . . . . . . . . . 34
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SECTION 4.3. Application of Collections . . . . . . . . . . . . . . . 35
SECTION 4.4. Net Deposits . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 4.5. Expiration of Lease Contracts . . . . . . . . . . . . . 36
ARTICLE V TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 5.1. Optional Purchase of All Contracts; Liquidation of
Trust Assets . . . . . . . . . . . . . . . . . . . . . . . . . 37
ARTICLE VI THE DEPOSITOR . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 6.1. Liability of Depositor . . . . . . . . . . . . . . . . . 38
SECTION 6.2. Merger or Consolidation of, or Assumption of the
Obligations of, Depositor; Amendment of Certificate of
Incorporation . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 6.3. Limitation on Liability of Depositor and Others . . . . 39
SECTION 6.4. Depositor May Own Equity Certificates or Notes . . . . . 39
ARTICLE VII THE SERVICER . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 7.1. Liability of Servicer; Indemnities . . . . . . . . . . . 40
SECTION 7.2. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer . . . . . . . . . . . . . . . . . 41
SECTION 7.3. Limitation on Liability of Servicer and Others . . . . . 42
SECTION 7.4. Servicer Not to Resign . . . . . . . . . . . . . . . . . 42
SECTION 7.5. Corporate Existence . . . . . . . . . . . . . . . . . . 42
ARTICLE VIII SERVICER TERMINATION EVENTS . . . . . . . . . . . . . . . . . . 43
SECTION 8.1. Servicer Termination Event . . . . . . . . . . . . . . . 43
SECTION 8.2. Consequences of a Servicer Termination Event . . . . . . 44
SECTION 8.3. Indenture Trustee to Act; Appointment of Successor . . . 45
SECTION 8.4. Notification to Equity Certificateholders and
Noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 8.5. Waiver of Past Defaults . . . . . . . . . . . . . . . . 46
ARTICLE IX MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . 47
SECTION 9.1. Amendment . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 9.2. Protection of Title to Trust Assets . . . . . . . . . . 48
SECTION 9.3. Governing Law . . . . . . . . . . . . . . . . . . . . . 50
SECTION 9.4. Severability of Provisions . . . . . . . . . . . . . . . 50
SECTION 9.5. Assignment . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 9.6. Third-Party Beneficiaries . . . . . . . . . . . . . . . 50
SECTION 9.7. Counterparts . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 9.8. Intention of Parties . . . . . . . . . . . . . . . . . . 51
SECTION 9.9. Notices . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 9.10. Income Tax Characterization . . . . . . . . . . . . . . 51
SECTION 9.11. Limitation of Liability . . . . . . . . . . . . . . . . 51
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EXHIBITS
Exhibit A-1 -- Schedule of Lease Contracts and Leased Equipment
Exhibit A-2 -- Schedule of Loan Contracts
Exhibit B -- Form of Servicer's Certificate
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THIS TRANSFER AND SERVICING AGREEMENT, dated as of October 1, 1996, is
made among CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1 (the "Issuer"), ANTIGUA
FUNDING CORPORATION, a Delaware corporation, as Depositor (the "Depositor"),
AT&T CAPITAL CORPORATION, a Delaware corporation, in its individual capacity and
as Servicer (in its individual capacity, "TCC"; in its capacity as Servicer, the
"Servicer"), and THE CHASE MANHATTAN BANK, a New York banking corporation, as
trustee under the Indenture hereinafter referred to (the "Indenture Trustee").
In consideration of the mutual agreements herein contained, and of
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITIONS. All terms defined in the Indenture or the
Trust Agreement (each as defined below) shall have the same meaning in this
Agreement. Whenever capitalized and used in this Agreement, the following words
and phrases, unless the context otherwise requires, shall have the following
meanings:
ACCOUNTANTS' REPORT: The report of a firm of nationally recognized
independent accountants described in Section 3.11.
ACCOUNTING DATE: With respect to a Payment Date, the last day of the
preceding calendar month.
ADMINISTRATIVE FEE: With respect to any Collection Period, all
administrative fees, expenses and charges collected in respect of the Contracts
during such Collection Period, including late fees, late payment interest,
documentation fees, insurance administration charges and that portion of any
Extension Fees allocated to the Servicer.
AFFILIATE: With respect to any Person, any other Person directly or
indirectly controlling, controlled by, or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
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AGREEMENT OR "THIS AGREEMENT": This Transfer and Servicing Agreement,
all amendments and supplements thereto and all exhibits and schedules to any of
the foregoing.
BOOK VALUE: With respect to any Leased Equipment, the value of such
Leased Equipment as shown on the accounting books and records of TCC or the
applicable Originator, as appropriate, as of the Cut-Off Date. The Book Value
for each item of Leased Equipment shall be set forth on Exhibit A-1 hereto.
BUSINESS DAY: Any day (other than a Saturday, Sunday or legal
holiday) on which commercial banking institutions in New York, New York, or any
other location of any successor Servicer or successor Indenture Trustee, are
open for regular business.
COLLECTION ACCOUNT: The account designated as such in, and
established and maintained pursuant to, Section 8.02 of the Indenture.
COLLECTION PERIOD: With respect to a Payment Date, the calendar month
preceding the month in which such Payment Date occurs (such calendar month being
referred to as the "related" Collection Period with respect to such Payment
Date). With respect to an Accounting Date, the Collection Period in which such
Accounting Date occurs is referred to herein as the "related" Collection Period
with respect to such Accounting Date.
COLLECTION RECORDS: All manually prepared or computer generated
records relating to collection efforts or payment histories with respect to the
Contracts.
CONTRACT FILE: The documents, electronic entries, instruments and
writings listed in Section 2.2 pertaining to a particular Contract.
CONTRACT POOL PRINCIPAL BALANCE: With respect to any Payment Date,
the sum of the Contract Principal Balances (computed as of the related
Accounting Date) for all Contracts.
CONTRACT PRINCIPAL BALANCE: As of any Accounting Date:
(i) in the case of a Lease Contract, the present value of the unpaid
Scheduled Payments due on such Lease Contract after such Accounting Date
(excluding all Scheduled Payments due on or prior to, but not received as
of, such Accounting Date, as well as any Scheduled Payments due after, but
received as of, such Accounting Date), after giving effect to any
Prepayments received on or prior to such Accounting Date, discounted
monthly at the rate of 8.10% per annum (assuming, for purposes of such
calculation, that each Scheduled Payment is due on the last day of the
applicable Collection Period), and
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(ii) in the case of a Loan Contract, the lesser of (a) the unpaid
principal balance of such Loan Contract as of such Accounting Date (after
giving effect to any Scheduled Payments due on or prior to such Accounting
Date, whether or not received, as well as any Prepayments, and any
Scheduled Payments due after such Accounting Date, received as of such
Accounting Date), and (b) the present value of the unpaid Scheduled
Payments due on such Loan Contract after such Accounting Date (excluding
all Scheduled Payments due on or prior to, but not received as of, such
Accounting Date, as well as any Scheduled Payments due after, but received
as of, such Accounting Date), after giving effect to any Prepayments
received on or prior to such Accounting Date, discounted monthly at the
rate of 8.10% per annum (assuming, for purposes of such calculation, that
each Scheduled Payment is due on the last day of the applicable Collection
Period);
PROVIDED that, for purposes of computing the Monthly Principal Amount or the
Requisite Cash Collateral Amount for a given Payment Date (as well as all
Payment Dates thereafter), the Contract Principal Balance of any Contract which
became a Liquidated Contract during the related Collection Period or was
required to be purchased by TCC as of the last day of the related Collection
Period in accordance with Section 2.6, will be deemed to be zero on and after
the last day of such Collection Period.
CONTRACT REPRESENTATIONS AND WARRANTIES: As defined in Section 2.6.
CONTRACTS: The Lease Contracts and the Loan Contracts.
CORPORATE TRUST OFFICE: With respect to the Owner Trustee, the
principal office of the Owner Trustee at which at any particular time its
corporate trust business shall be administered, which office on the date of
execution and delivery of this Agreement is located at 101 Barclay Street, Floor
12 East, New York, New York 10286, Attention: Corporate Trust Administration--
Asset Backed Unit; the telecopy number for the Corporate Trust Office of the
Owner Trustee on the date of execution and delivery of this Agreement is (212)
815-5544; 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 is located at 450 West 33rd Street, New, New
York 10001, Attention: Advance Structured Products Group; the telecopy number
for the Corporate Trust Office of the Indenture Trustee on the date of execution
and delivery of this Agreement is (212) 946-3916.
CUT-OFF DATE: October 1, 1996.
CUT-OFF DATE CONTRACT POOL PRINCIPAL BALANCE: $3,185,229,329.
DEPOSIT DATE: With respect to any Collection Period, the Business Day
immediately preceding the related Determination Date.
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DEPOSITOR: Antigua Funding Corporation, a Delaware corporation, or
its successor in interest pursuant to Section 6.2.
DETERMINATION DATE: With respect to any Collection Period, the fifth
Business Day immediately preceding the related Payment Date.
ELIGIBLE SERVICER: TCC, the Indenture Trustee or another Person
which at the time of its appointment as Servicer (i) is servicing a portfolio of
equipment lease contracts, installment sale contracts, promissory notes, loan
and security agreements and/or other similar types of receivables comparable to
the Contracts, (ii) is legally qualified and has the capacity to service the
Contracts, (iii) has demonstrated the ability professionally and competently to
service a portfolio of equipment lease contracts, installment sale contracts,
promissory notes, loan and security agreements and other similar types of
receivables comparable to the Contracts with reasonable skill and care, and (iv)
has available software which is adequate to perform its duties and
responsibilities under this Agreement.
EQUIPMENT: With respect to any Contract, the property which is leased
or purchased pursuant to such Contract, or which otherwise provides security for
the payment of amounts payable thereunder.
EQUITY CERTIFICATE BALANCE: As of any date, the Original Equity
Certificate Balance less all distributions previously made to the Equity
Certificates in respect of principal.
EQUITY CERTIFICATE MAJORITY: Holders of Equity Certificates
representing more than 50% of the Equity Certificate Balance.
EXTENSION FEES: With respect to any Contract, any fee received by the
Servicer in consideration for the granting of an extension on the payment of any
Scheduled Payment due under such Contract. Any Extension Fees received shall be
allocated as follows: (1) 50% thereof shall be allocated to the Issuer and
shall constitute Pledged Revenues; and (2) 50% thereof shall be allocated to the
Servicer and shall constitute an Administrative Fee.
INDENTURE: The Indenture, dated as of October 1, 1996, between the
Issuer and the Indenture Trustee, as the same may be amended and supplemented
from time to time.
INDENTURE TRUSTEE: The Person acting as Trustee under the Indenture,
its successors in interest and any successor Trustee under the Indenture.
INDEPENDENT ACCOUNTANTS: As defined in Section 3.11(a).
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INSURANCE, MAINTENANCE AND TAX ACCOUNTS: The accounts which are
established and maintained pursuant to Section 3.4(a).
INSURANCE POLICY: With respect to a Contract, any insurance policy
benefiting the lessor or secured party under the Contract providing loss or
physical damage, theft or similar coverage with respect to the Equipment.
ISSUER: Capita Equipment Receivables Trust 1996-1.
LEASE CONTRACTS: The lease contracts listed on Exhibit A-1 hereto
(excluding any such lease contract which has become a Purchased Contract) and
all rights and obligations under such contracts, including, without limitation,
all monies at any time paid or payable thereon or in respect thereof from and
after the Cut-Off Date (whether in the form of (i) Scheduled Payments (including
those Scheduled Payments due prior to, but not received as of, the Cut-Off Date,
but excluding those Scheduled Payments due on or after, but received prior to,
the Cut-Off Date), (ii) Prepayments, (iii) Liquidation Proceeds, (iv) Extension
Fees, (v) payments to be applied by the Servicer to the payment of insurance
charges, maintenance, taxes or other similar obligations, (vi) payments to be
retained by the Servicer in payment of Administrative Fees, or otherwise), and
all rights of the lessor in the related Equipment (other than any ownership
interest of the lessor in such Equipment), Insurance Policies and any other
security for the payment of amounts due under such contracts.
LEASED EQUIPMENT: With respect to any Lease Contract, the Equipment
subject to such Lease Contract, as more particularly described on Exhibit A-1
hereto.
LIEN: Any security interest, lien, charge, pledge, preference, equity
or encumbrance of any kind, including tax liens, mechanics' liens and any liens
that attach by operation of law.
LIQUIDATED CONTRACT: With respect to any Collection Period, (i) a
Contract which, during such Collection Period, was charged off as uncollectible
by the Servicer in accordance with its credit and collection policies and
procedures (which shall be no later than the date as of which the Servicer has
repossessed and disposed of the related Equipment and otherwise collected all
proceeds (including any proceeds of insurance to be applied as described in
Section 3.4(c)(ii)) which, in the Servicer's reasonable judgment, can be
collected under such Contract) following a default thereunder or upon damage to
or destruction of such Equipment (if such Equipment is not to be replaced or
repaired in accordance with Section 3.4(c)(i)), or (ii) a Contract as to which,
during such Collection Period, 10% or more of a Scheduled Payment shall have
become 180 days delinquent.
LIQUIDATION PROCEEDS: All amounts received by the Servicer (i) in
connection with the liquidation of any Contract and disposition of the related
Equipment or (ii) as insurance proceeds with respect to any damaged or destroyed
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Equipment to be applied as described in Section 3.4(c)(ii), in each case net of
(a) reasonable out-of-pocket expenses incurred by or on behalf of the Servicer
in connection with the collection of such Contract and the maintenance,
repossession, repair, storage and disposition of the related Equipment
(including taxes and insurance charges, to the extent in excess of amounts
available therefor and relating to such Contract in the Insurance, Maintenance
and Tax Accounts, as well as attorneys' fees) and (b) amounts that are required
to be refunded to the Obligor on such Contract; PROVIDED, HOWEVER, that the
Liquidation Proceeds with respect to any Contract and disposition of the related
Equipment shall in no event be less than zero. Liquidation Proceeds shall be
allocated as follows: (1) in the case of any Loan Contract, all Liquidation
Proceeds shall be allocated to the Issuer; and (2) in the case of any Lease
Contract, Liquidation Proceeds shall be allocated pro rata between the Issuer,
on the one hand, and the Depositor, on the other, based upon the Required Payoff
Amount for such Lease Contract (determined as of the Collection Period during
which such Lease Contract became a Liquidated Contract) and the Book Value of
the related Leased Equipment, respectively; PROVIDED that, in the event the
Liquidation Proceeds exceed the sum of the Required Payoff Amount for a given
Lease Contract plus the Book Value of the related Leased Equipment, any such
excess shall be allocated solely to the Depositor.
LOAN CONTRACTS: The installment sale contracts, promissory notes,
loan and security agreements and other similar types of receivables listed on
Exhibit A-2 hereto (excluding any such contract, note, agreement or receivable
which has become a Purchased Contract) and all rights and obligations under such
contracts, including, without limitation, all monies at any time paid or payable
thereon or in respect thereof from and after the Cut-Off Date (whether in the
form of (i) Scheduled Payments (including those Scheduled Payments due prior to,
but not received as of, the Cut-Off Date, but excluding those Scheduled Payments
due on or after, but received prior to, the Cut-Off Date), (ii) Prepayments,
(iii) Liquidation Proceeds, (iv) Extension Fees, (v) payments to be applied by
the Servicer to the payment of insurance charges, maintenance, taxes or other
similar obligations, (vi) payments to be retained by the Servicer in payment of
Administrative Fees, or otherwise), and all rights of the secured party in the
related Equipment, Insurance Policies and any other security for the payment of
amounts due under such contracts.
MONTHLY RECORDS: All records and data maintained by the Servicer with
respect to the Contracts in accordance with its customary standards, policies
and procedures.
NOTE DISTRIBUTION ACCOUNT: The account designated as such in, and
established and maintained pursuant to, Section 8.04 of the Indenture.
NOTE MAJORITY: Holders of Notes representing a majority of the
Principal Balance of each Class of the Notes then Outstanding.
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OBLIGOR: The lessee, borrower, purchaser or any other Person or
Persons who are obligated to make payments under a Contract.
OPINION OF COUNSEL: A written opinion of counsel acceptable in form
and substance and from counsel acceptable to the Owner Trustee and, if such
opinion or a copy thereof is required to be delivered to the Indenture Trustee,
to the Indenture Trustee.
ORIGINAL TERM: With respect to any Contract, the term of such
Contract as of the Cut-Off Date (which shall include any renewals or extensions
of the original term thereof prior to the Cut-Off Date), as such term may be
extended in accordance with Section 3.2(c) or as a result of a bankruptcy
proceeding with respect to the related Obligor, but excluding, in the case of
any Lease Contract, any other extensions or renewals thereof.
ORIGINATORS: AT&T Capital Leasing Services, Inc., AT&T Credit
Corporation, NCR Credit Corp. and AT&T Commercial Finance Corporation.
OWNER TRUSTEE: The Bank of New York, acting not individually but
solely as trustee, or its successor in interest, and any successor Owner Trustee
appointed as provided in the Trust Agreement.
PAYMENT DATE: The fifteenth day of each calendar month (or, if such
fifteenth day is not a Business Day, the next succeeding Business Day),
commencing November 15, 1996.
PERSON: Any legal person, including any individual, corporation,
partnership, joint venture, estate, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof, or any other entity.
PLEDGED REVENUES: (i) All Scheduled Payments on the Contracts
received on or after the Cut-Off Date (including all Scheduled Payments due
prior to, but not received as of, the Cut-Off Date, but excluding any Scheduled
Payments due on or after, but received prior to, the Cut-Off Date); (ii) any
Prepayments received on the Contracts on or after the Cut-Off Date (other than,
in the case of a Lease Contract, any portion thereof allocated to the
Depositor); (iii) the Purchase Amount of any Contracts purchased by TCC in
accordance with Section 2.6 (other than any portion thereof attributable to the
Book Value of the Leased Equipment); (iv) the amount paid by the Depositor to
purchase the Contracts pursuant to Section 5.1; (v) that portion of the
Liquidation Proceeds received in respect of any Contracts and the disposition of
the related Equipment on or after the Cut-Off Date and allocated to the Issuer;
(vi) that portion of any Extension Fees received on or after the Cut-Off Date
and allocated to the Issuer; and (vii) any earnings on the investment of amounts
credited to the Collection Account and the Note Distribution Account.
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PREPAYMENT: With respect to any Collection Period for any Contract, a
voluntary prepayment during such Collection Period of amounts due and owing
under such Contract; PROVIDED that, in the case of any Lease Contract, the
amount, if any, by which any such Prepayment exceeds the Required Payoff Amount
for such Contract shall be allocated to the Depositor in respect of the related
Leased Equipment.
PRINCIPAL BALANCE: As of any date, when used with respect to a Class
of Notes, the original principal balance of such Class, less all distributions
previously made to such Class in respect of principal.
PURCHASE AGREEMENT: The Purchase and Sale Agreement, dated as of
October 1, 1996, among TCC, the Originators and the Depositor.
PURCHASE AMOUNT: With respect to a Contract and related Equipment
required to be purchased by TCC in accordance with Section 2.6, the sum of (i)
the Required Payoff Amount for such Contract as of the Accounting Date on which
such obligation to so purchase arises, plus (ii) in the case of a Lease
Contract, the Book Value of the related Leased Equipment (that portion of the
Purchase Amount attributable to such Book Value to be allocated to the
Depositor).
PURCHASED CONTRACT: As of any Deposit Date, any Contract which TCC
has purchased as of the related Accounting Date, as required by Section 2.6, and
as to which, on or before such Deposit Date, (i) that portion of the Purchase
Amount relating to the Required Payoff Amount for such Contract has been
deposited in the Collection Account, and (ii) that portion, if any, of the
Purchase Amount relating to the Book Value of the related Leased Equipment has
been distributed to the Depositor.
RELATED ASSETS: The assets, in addition to the Contracts, transferred
by the Depositor to the Issuer pursuant to Section 2.1(a).
RELATED DOCUMENTS: The Trust Agreement, the Indenture, the Equity
Certificates, the Notes, the Purchase Agreement and the Cash Collateral Account
Agreement. The Related Documents executed by any party are referred to herein
as "such party's Related Documents," "its Related Documents" or by a similar
expression.
REQUIRED PAYOFF AMOUNT: With respect to any Collection Period for any
Contract, the sum of (i) the Scheduled Payment due in such Collection Period,
together with any Scheduled Payments due in prior Collection Periods but not yet
received, plus (ii) the Contract Principal Balance of such Contract (after
taking into account the Scheduled Payment due in such Collection Period, whether
or not received).
RESPONSIBLE OFFICER: When used with respect to the Servicer, the
Depositor or any other Person, the President, any Vice-President or Assistant
Vice-President or the Controller of such Person, or any other officer or
employee having similar functions.
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SCHEDULE OF CONTRACTS: Collectively, the schedules of Lease Contracts
and Loan Contracts (which shall be made available to the parties hereto on a
computer disk or other data storage medium) attached hereto as (or described in)
Exhibit A-1 and Exhibit A-2, respectively.
SCHEDULED PAYMENT: With respect to any Collection Period for any
Contract during the Original Term of such Contract, the scheduled payment or
payments due under such Contract in such Collection Period other than those
portions of such payments which, under such Contract, are to be (i) applied by
the Servicer to the payment of insurance charges, maintenance, taxes and other
similar obligations, or (ii) retained by the Servicer in payment of
Administrative Fees.
SERVICER: AT&T Capital Corporation, its successor in interest
pursuant to Section 8.2 or, after any termination of the Servicer upon a
Servicer Termination Event, any successor Servicer.
SERVICER TERMINATION EVENT: An event described in Section 8.1.
SERVICER'S CERTIFICATE: With respect to each Determination Date, a
certificate, completed by and executed on behalf of the Servicer, in accordance
with Section 3.9, substantially in the form attached hereto as Exhibit B.
SERVICING ACCOUNT: The account designated as such in, and established
and maintained pursuant to, Section 8.05 of the Indenture.
SERVICING FEE: With respect to any Collection Period, the fee payable
to the Servicer for services rendered during such Collection Period, which shall
be equal to one-twelfth of the Servicing Fee Rate multiplied by the Contract
Pool Principal Balance determined as of the last day of the preceding Collection
Period (or, in the case of the Servicing Fee with respect to the Collection
Period commencing on the Cut-Off Date, the Contract Pool Principal Balance as of
the Cut-Off Date).
SERVICING FEE RATE: 1.25% per annum.
SUB-SERVICER: The Person named as servicer or sub-servicer in any
agreement between the Servicer and such Person by which such Person is
contractually obligated to perform on the Servicer's behalf all or a part of the
servicing obligations described herein.
TCC: AT&T Capital Corporation, a Delaware corporation.
TOTAL SERVICING FEE: The sum of the Servicing Fee, the Administrative
Fees and any earnings on the investment of amounts in the Servicing Account.
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TRUST ACCOUNTS: The Collection Account, the Note Distribution
Account, the Servicing Account, the Insurance, Maintenance and Tax Accounts and
such other accounts as may be established in the name of the Issuer or the
Indenture Trustee pursuant to the Trust Agreement or this Agreement.
TRUST AGREEMENT: The Amended and Restated Trust Agreement, dated as
of October 1, 1996, between the Depositor and the Owner Trustee, as the same may
be amended and supplemented from time to time in accordance with the terms
thereof.
UCC: The Uniform Commercial Code as in effect in the relevant
jurisdiction.
SECTION 1.2. USAGE OF TERMS. With respect to all terms used in this
Agreement, the singular includes the plural and the plural the singular; words
importing any gender include the other gender; references to "writing" include
printing, typing, lithography, and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement; references to
Persons include their permitted successors and assigns; and the terms "include"
or "including" mean "include without limitation" or "including without
limitation."
SECTION 1.3. CALCULATIONS. All calculations of the amount of the
Servicing Fee shall be made on the basis of a 360-day year consisting of twelve
30-day months. All references to the Contract Principal Balance of a Contract
as of any date shall refer to the close of business on such date.
SECTION 1.4. SECTION REFERENCES. All references to Articles,
Sections, paragraphs, subsections, exhibits and schedules shall be to such
portions of this Agreement unless otherwise specified.
SECTION 1.5. NO RECOURSE. No recourse may be taken, directly or
indirectly, under this Agreement or any certificate or other writing delivered
in connection herewith or therewith, against any stockholder, officer or
director, as such, of the Depositor, TCC, the Servicer, the Indenture Trustee or
the Owner Trustee or of any predecessor or successor of the Depositor, TCC, the
Servicer, the Indenture Trustee or the Owner Trustee.
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ARTICLE II
CONVEYANCE OF CONTRACTS
SECTION 2.1. CONVEYANCE OF CONTRACTS AND RELATED ASSETS. (a)
Subject to the terms and conditions of this Agreement, the Depositor, pursuant
to the mutually agreed upon terms contained herein, hereby transfers, assigns,
and otherwise conveys to the Issuer, without recourse (but without limitation of
its obligations in this Agreement), as of the Closing Date, all of the right,
title and interest, including any security interest, whether now owned or
hereafter acquired, of the Depositor in and to the following:
(i) the Contracts, including, without limitation, (A) all monies at
any time paid or payable thereon or in respect thereof from and after the
Cut-Off Date in the form of (1) Scheduled Payments (including those
Scheduled Payments due prior to, but not received as of, the Cut-Off Date,
but excluding those Scheduled Payments due on or after, but received prior
to, the Cut-Off Date), (2) Prepayments (other than, in the case of a Lease
Contract, any portion thereof allocated to the Depositor in accordance with
this Agreement), (3) Liquidation Proceeds (but only that portion thereof
allocated to the Issuer in accordance with this Agreement), (4) Extension
Fees, (5) payments to be applied by the Servicer to the payment of
insurance charges, maintenance, taxes or other similar obligations, and (6)
payments to be retained by the Servicer in payment of Administrative Fees,
but excluding any payments made and attributable to the purchase price or
use of any Leased Equipment upon expiration of the related Lease Contract
(whether upon completion of the Original Term thereof, Prepayment thereof
or otherwise), (B) all rights of the lessor or the secured party, as the
case may be, in the Equipment related to the Loan Contracts and all present
or future leases and other contracts relating to such Equipment and all
revenues, payments, rights to payment, profits, accounts, chattel paper,
products and contract rights arising from or related to such Equipment or
any use thereof or from any such lease or other contract, (C) all rights of
the lessor or secured party, as the case may be, in all Insurance Policies
and any other security (other than any ownership interest of the lessor in
the Leased Equipment) for the payment of amounts due under the Contracts
(including all rights, if any, the lessor or the secured party may have
against vendors and other third parties for payments of such amounts), (D)
all items contained in the related Contract Files and any and all other
documents that are kept on file in accordance with the applicable
Originator's customary procedures relating to the Contracts, and (E) all
proceeds of the foregoing;
(ii) all funds on deposit from time to time in the Trust Accounts
and all investments therein and proceeds thereof; and
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(iii) the Purchase Agreement, including (A) any Purchase Amount paid
(other than any portion thereof attributable to the Book Value of the
Leased Equipment), and (B) any deemed loan made by the Depositor to the
Originators and all security therefor, including the security interest in
the Contracts and Equipment granted by the Originators to the Depositor to
secure such deemed loan, as described in Section 2.2 of the Purchase
Agreement, and all proceeds of the foregoing.
The foregoing does not constitute, nor is it intended to result in, the creation
or assumption by the Issuer, the Owner Trustee, the Indenture Trustee, any
Noteholder or any Equity Certificateholder of any obligation of the Depositor,
the Servicer or any other Person in connection with the Contracts or the related
Equipment or any agreement or instrument relating thereto, including any
obligation to the Obligors.
(b) Subject to the terms and conditions of this Agreement, upon the
transfer of the Contracts and other assets pursuant to Section 2.1(a), the
Depositor will be entitled to (i) the Leased Equipment and any payments made and
attributable to the purchase price or use of the Leased Equipment upon
expiration of the related Lease Contract (whether upon completion of the
Original Term thereof, Prepayment thereof or otherwise), (ii) that portion of
any Prepayments and Liquidation Proceeds received on or after the Cut-Off Date
and allocated to the Depositor in accordance with this Agreement and (iii) that
portion of any Purchase Amount attributable to the Book Value of the Leased
Equipment.
(c) As security for the payment of amounts described in Section
2.1(a)(i)(3), the Depositor hereby grants to the Issuer a security interest in
all of the right, title and interest, whether now owned or hereafter acquired,
of the Depositor in and to the Leased Equipment and all proceeds thereof.
SECTION 2.2. CUSTODY OF CONTRACT FILES.
(a) The Owner Trustee, on behalf of the Issuer, hereby appoints the
Servicer, and the Servicer hereby accepts such appointment, to act as the agent
of the Issuer as custodian of the following documents or instruments (with
respect to each Contract), which will be, as of the Closing Date, in the
possession of the Servicer or its agents:
(i) The fully executed original of the Contract or a facsimile
copy thereof (together with any agreements modifying the Contract,
including, without limitation, any extension agreements);
(ii) Documents evidencing or related to any Insurance Policy,
or copies thereof; and
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(iii) Such documents, if any, that the applicable Originator
keeps on file in accordance with its customary procedures indicating that
the Equipment is owned or leased by the Obligor and subject to the interest
of the lessor or secured party.
(b) The Servicer agrees to maintain the Contract Files at the
locations where they are currently maintained, or at such other locations as
shall from time to time be identified to the Trustee by written notice. The
Servicer may temporarily move individual Contract Files or any portion thereof
without notice as necessary to conduct collection and other servicing activities
in accordance with its customary practices and procedures.
(c) As custodian, the Servicer shall have and perform the following
powers and duties:
(i) hold the Contract Files on behalf of the Equity
Certificateholders, the Depositor, the Owner Trustee, the Issuer, the
Noteholders and the Indenture Trustee, maintain accurate records pertaining
to each Contract to enable it to comply with the terms and conditions of
this Agreement and the Related Documents, maintain a current inventory
thereof and certify to the Trustee annually that it continues to maintain
possession of such Contract Files;
(ii) implement written policies and procedures with respect to
persons authorized to have access to the Contract Files and the receipting
for Contract Files taken from their storage area by an employee of the
Servicer for purposes of servicing or any other purposes; and
(iii) attend to all details in connection with maintaining
custody of the Contract Files on behalf of the Equity Certificateholders,
the Depositor, the Owner Trustee, the Issuer, the Noteholders and the
Indenture Trustee.
(d) In performing its duties under this Section, the Servicer agrees
to act with reasonable care, using that degree of skill and care that it
exercises with respect to similar contracts owned and/or serviced by it. The
Servicer shall promptly report to the Trustee any failure by it to hold the
Contract Files as herein provided and shall promptly take appropriate action to
remedy any such failure. In acting as custodian of the Contract Files, the
Servicer agrees further not to assert any beneficial ownership interests in the
Contracts or the Contract Files. The Servicer agrees to indemnify the Equity
Certificateholders, the Depositor, the Owner Trustee, the Issuer, the
Noteholders and the Indenture Trustee for any and all liabilities, obligations,
losses, damages, payments, costs or expenses of any kind whatsoever which may be
imposed on, incurred or asserted against the Equity Certificateholders, the
Depositor, the Owner Trustee, the Issuer, the Noteholders or the Indenture
Trustee as the result of any act or omission by the Servicer relating to the
maintenance and custody of the Contract Files; PROVIDED, HOWEVER, that the
Servicer will not be liable for any portion of any such
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amount resulting from the negligence or willful misconduct of any Equity
Certificateholder, the Depositor, the Owner Trustee, the Issuer, any Noteholder
or the Indenture Trustee.
SECTION 2.3. FURTHER ASSURANCES. Following the Closing Date, the
Depositor shall, at the reasonable request of the Owner Trustee, the Indenture
Trustee or the Servicer, and at the Depositor's expense, execute and deliver any
further instruments of transfer or other documents, and shall take all such
other actions that may be necessary, appropriate or desirable, to fully convey
the Contracts and the Related Assets to the Issuer or otherwise to evidence,
effectuate or implement the transactions contemplated hereby. In addition, the
Depositor, as agent for the Issuer, shall defend the Contracts and the Related
Assets against any and all claims and demands of all Persons at any time
claiming the same or any interest therein adverse to that of the Issuer.
SECTION 2.4. REPRESENTATIONS AND WARRANTIES OF DEPOSITOR. By its
execution of this Agreement, the Depositor makes the following representations
and warranties. Unless otherwise specified, such representations and warranties
speak as of the date of execution and delivery of this Agreement or, as to the
representations and warranties contained in paragraphs (k), (l), (m) and (n), as
of the Closing Date.
(a) ORGANIZATION AND GOOD STANDING. The Depositor has been duly
organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware, with power and authority to own its
properties and to conduct its business as such properties are currently
owned and such business is currently conducted, and had at all relevant
times, and now has, power, authority and legal right to acquire, own and
transfer the Contracts and the other property transferred to the Issuer.
(b) DUE QUALIFICATION. The Depositor is duly qualified to do
business as a foreign corporation in good standing, and has obtained all
necessary licenses and approvals, in all jurisdictions where the failure to
do so would materially and adversely affect the performance of its
obligations under this Agreement and the Related Documents.
(c) POWER AND AUTHORITY. The Depositor has the power and
authority to execute and deliver this Agreement and the Depositor's Related
Documents and to carry out the terms hereof and thereof; the Depositor has
full power and authority to transfer and assign the Trust Assets to be
transferred and assigned to and deposited with the Issuer by it and has
duly authorized such transfer and assignment to the Issuer by all necessary
corporate action; and the execution, delivery and performance of this
Agreement and the Depositor's Related Documents have been duly authorized
by the Depositor by all necessary corporate action.
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(d) NO CONSENT REQUIRED. No consent, license, approval or
authorization of, or registration or declaration with, any Person or any
governmental authority, bureau or agency is required in connection with the
execution, delivery or performance of this Agreement and the Related
Documents, except for such as have been obtained, effected or made or as
described in paragraph (m) below.
(e) VALID TRANSFER; BINDING OBLIGATIONS. This Agreement
effects, as of the Closing Date, a valid transfer and assignment of the
Contracts and the other Trust Assets, enforceable against the Depositor and
creditors of and purchasers from the Depositor; and this Agreement and the
Depositor's Related Documents, when duly executed and delivered, shall
constitute legal, valid and binding obligations of the Depositor
enforceable in accordance with their respective terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights generally
and by equitable limitations on the availability of specific remedies,
regardless of whether such enforceability is considered in a proceeding in
equity or at law.
(f) NO VIOLATION. The execution and delivery of this Agreement
and the Related Documents, the consummation of the transactions
contemplated by this Agreement and the Related Documents and the
fulfillment of the terms of this Agreement and the Related Documents shall
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, or both) a
default under the certificate of incorporation or by-laws of the Depositor,
or any indenture, agreement, mortgage, deed of trust or other instrument to
which the Depositor is a party or by which it is bound, or result in the
creation or imposition of any Lien upon any of its properties pursuant to
the terms of any such indenture, agreement, mortgage, deed of trust or
other instrument, other than this Agreement, or violate any law, order,
rule or regulation applicable to the Depositor of any court or of any
federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Depositor or any
of its properties.
(g) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to the Depositor's knowledge, threatened against the Depositor,
before any court, regulatory body, administrative agency or other tribunal
or governmental instrumentality having jurisdiction over the Depositor or
its properties (A) asserting the invalidity of this Agreement or any of the
Related Documents, (B) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or any of the Related
Documents, (C) seeking any determination or ruling that might materially
and adversely affect the performance by the Depositor of its obligations
under, or the validity or enforceability of, this Agreement or any of the
Related Documents, or (D) seeking to adversely affect (i) the federal
income tax or other federal, state or
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local tax attributes of the Equity Certificates or the Notes or (ii) the
federal, state or local tax treatment of any of the transactions
contemplated by this Agreement and the Related Documents.
(h) PLACE OF BUSINESS. The principal executive offices of the
Depositor, and the offices where the Depositor keeps its records concerning
the Contracts and related documents, are located at 44 Whippany Road,
Morristown, New Jersey.
(i) REGISTRATION STATEMENT. No stop order suspending the
effectiveness of the Registration Statement relating to the Notes has been
issued, and no proceeding for that purpose has been instituted or is
threatened, by the Securities and Exchange Commission.
(j) FILINGS. Since the effective date of the Registration
Statement relating to the Notes, there has occurred no event required to be
set forth in an amendment or supplement to the Registration Statement or
Prospectus that has not been so set forth, and there has been no document
required to be filed under the Securities Exchange Act of 1934 and the
rules and regulations of the Securities and Exchange Commission thereunder
that upon such filing would be deemed to be incorporated by reference in
the Prospectus that has not been so filed.
(k) GOOD TITLE. Immediately prior to the transfer and
assignment of the Contracts and Related Assets to the Issuer pursuant to
Section 2.1(a), the Depositor had good title thereto and was the sole owner
thereof (subject, in the case of amounts in the Insurance, Maintenance and
Tax Accounts, to the rights of the Obligors therein), free of any Lien.
Upon the transfer and assignment of the Contracts and Related Assets to the
Issuer pursuant to Section 2.1(a), the Issuer will have good title thereto
and will be the sole owner thereof (subject, in the case of amounts in the
Insurance, Maintenance and Tax Accounts, to the rights of the Obligors
therein), free of any Lien.
(l) NO IMPAIRMENT. No person has a participation in or other
right to receive Scheduled Payments under any Contract, and the Depositor
has taken no action to convey any right to any Person that would result in
such Person having a right to Scheduled Payments received with respect to
any Contract.
(m) LAWFUL ASSIGNMENT. No Contract was originated in, or is
subject to the laws of, any jurisdiction the laws of which would make
unlawful, void or voidable the transfer and assignment of such Contract
from the Depositor to the Issuer under this Agreement. Each Contract may
be sold, assigned and transferred by the Depositor to the Issuer without
the consent of, or prior approval from, or any notification to, the
applicable Obligor, other than (i)
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certain Contracts (which, in proportion to the aggregate of all of the
Contracts, are not material) that require notification of the assignment to
the Obligor, which notification will be given by the Servicer not later
than 10 days following the Closing Date, and (ii) certain Contracts (which,
in proportion to the aggregate of all of the Contracts, are not material)
that require the consent of the Obligor, which consent will be obtained by
the Servicer not later than 10 days following the Closing Date.
(n) ALL FILINGS MADE. All filings and other actions required to
be made, taken or performed by any Person in any jurisdiction to give the
Issuer a first priority perfected lien or ownership interest in the
Contracts has been made, taken or performed.
(o) SCHEDULE OF CONTRACTS ACCURATE. The information with
respect to the Contracts contained in the Schedule of Contracts is true and
correct in all material respects.
SECTION 2.5. NONPETITION COVENANT. None of the Depositor, the
Servicer, the Owner Trustee (in its individual capacity or on behalf of the
Trust) nor TCC shall petition or otherwise invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Issuer or the Depositor under any federal or state bankruptcy, insolvency or
similar law or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Issuer or the Depositor or any
substantial part of its property, or ordering the winding up or liquidation of
the affairs of the Issuer or the Depositor.
SECTION 2.6. PURCHASE OF CONTRACTS UPON BREACH OF REPRESENTATIONS AND
WARRANTIES. Concurrently with the execution and delivery of this Agreement,
TCC, the Originators and the Depositor have entered into the Purchase Agreement,
the rights of the Depositor under which have been assigned by the Depositor to
the Issuer pursuant to Section 2.1(a). Under the Purchase Agreement, TCC and
the Originators have made certain representations and warranties to the
Depositor with respect to the Contracts (the "Contract Representations and
Warranties"). As of the second Accounting Date following its discovery or its
receipt of notice of any breach of the Contract Representations and Warranties
that materially and adversely affects the value of any Contract (including any
Liquidated Contract), TCC shall, unless such breach shall have been cured in all
material respects, (i) purchase such Contract from the Issuer, and (ii) in the
case of a Lease Contract, purchase the related Leased Equipment from the
Depositor. On or before the related Deposit Date, TCC shall pay the Purchase
Amount to the Servicer on behalf of the Owner Trustee and the Depositor, as
their interests may appear. The obligations of the Depositor with respect to
any such breach of representations and warranties shall be limited to taking any
and all actions necessary to enable the Owner Trustee to enforce directly the
obligations of TCC to purchase the applicable Contract under the Purchase
Agreement. It is understood and agreed that, except as set forth in the
following paragraph, the obligation of TCC to purchase any
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Contract, together with the related Equipment, as to which a breach has occurred
and is continuing shall, if such obligation is fulfilled, constitute the sole
remedy against TCC for such breach available to the Owner Trustee on behalf of
the Equity Certificateholders, to the Depositor or the Indenture Trustee on
behalf of the Noteholders and to the Depositor, as their interests may appear.
In addition to the foregoing and notwithstanding whether the Contract
and related Equipment shall have been purchased by TCC, TCC shall indemnify the
Equity Certificateholders, the Depositor, the Owner Trustee, the Issuer, the
Noteholders and the Indenture Trustee against all costs, expenses, losses,
damages, claims and liabilities, including reasonable fees and expenses of
counsel, which may be asserted against or incurred by any of them as a result of
third party claims arising out of the events or facts giving rise to such
breach.
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ARTICLE III
ADMINISTRATION AND SERVICING OF CONTRACTS
SECTION 3.1. DUTIES OF THE SERVICER. The Servicer is hereby
authorized to act as agent for the Issuer and the Depositor and in such capacity
shall manage, service, administer and make collections on the Contracts, and
perform the other actions required by the Servicer under this Agreement. The
Servicer agrees that its servicing of the Contracts shall be carried out in
accordance with customary and usual procedures of institutions which service
equipment lease contracts, installment sale contracts, promissory notes, loan
and security agreements and other similar types of receivables comparable to the
Contracts and, to the extent more exacting, the degree of skill and attention
that the Servicer exercises from time to time with respect to all comparable
such contracts that it services for itself or others. In performing such
duties, so long as TCC is the Servicer, it shall comply in all material respects
with its customary standards, policies and procedures in effect from time to
time. The Servicer may at any time change its customary standards, policies and
procedures; PROVIDED that any such change shall not materially impair the
collectibility of any Contract nor the Servicer's ability to perform its
obligations under this Agreement and the Related Documents. The Servicer's
duties shall include, without limitation, billing, collection and posting of all
payments, responding to inquiries of Obligors on the Contracts, investigating
delinquencies, sending invoices to Obligors, accounting for collections and
furnishing monthly and annual statements to the Owner Trustee and the Indenture
Trustee with respect to distributions, monitoring the status of Insurance
Policies with respect to the Equipment and performing the other duties specified
herein. The Servicer shall also administer and enforce all material rights and
responsibilities of the lessor or secured party under the Contracts and provided
for in the Insurance Policies, to the extent that such Insurance Policies relate
to the Contracts, the Equipment or the Obligors. To the extent consistent with
the standards, policies and procedures otherwise required hereby, the Servicer
shall follow its customary standards, policies and procedures and shall have
full power and authority to do any and all things in connection with such
managing, servicing, administration and collection that it may deem necessary or
desirable, including the authority to forego collection efforts under
circumstances deemed appropriate by the Servicer in accordance with its
customary standards, policies and procedures. Without limiting the generality
of the foregoing, the Servicer is hereby authorized and empowered by the Owner
Trustee to execute and deliver, on behalf of the Equity Certificateholders, the
Depositor and the Issuer or any of them, any and all instruments of satisfaction
or cancellation, or of partial or full release or discharge, and all other
comparable instruments, with respect to the Contracts and with respect to the
Equipment in accordance with its customary standards, policies and procedures.
The Servicer is hereby authorized to commence, in its own name (or in the name
of the Issuer, PROVIDED the Servicer has obtained the Owner Trustee's consent,
which consent shall not be unreasonably withheld), a legal proceeding to enforce
a Contract pursuant to Section 3.3 or to commence or participate in any other
legal proceeding (including, without limitation, a bankruptcy proceeding)
relating to or
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involving a Contract, an Obligor or the related Equipment. If the Servicer
commences or participates in such a legal proceeding in its own name, the Issuer
shall thereupon be deemed to have automatically assigned such Contract to the
Servicer solely for purposes of commencing or participating in any such
proceeding as a party or claimant, and the Servicer is authorized and empowered
by the Owner Trustee to execute and deliver in the Servicer's name any notices,
demands, claims, complaints, responses, affidavits or other documents or
instruments in connection with any such proceeding. The Owner Trustee shall
furnish the Servicer with any powers of attorney and other documents which the
Servicer may reasonably request and which the Servicer deems necessary or
appropriate and take any other steps which the Servicer may deem necessary or
appropriate to enable the Servicer to carry out its servicing and administrative
duties under this Agreement.
SECTION 3.2. COLLECTION OF CONTRACT PAYMENTS; MODIFICATIONS OF
CONTRACTS.
(a) Consistent with the standards, policies and procedures required
by this Agreement, the Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Contracts as and when
the same shall become due, and shall follow such collection procedures as it
follows with respect to all comparable contracts that it services for itself or
others and otherwise act with respect to the Contracts, the related Equipment,
the Insurance Policies and the other Trust Assets in such manner as will, in the
reasonable judgment of the Servicer, maximize the amount to be received by the
Issuer and the Depositor with respect thereto. The Servicer is authorized in
its discretion to waive any Administrative Fees or Extension Fees that may be
collected in the ordinary course of servicing any Contract.
(b) The Servicer may at any time agree to a modification or amendment
of a Contract in accordance with its credit and collection policies and
procedures (it being acknowledged that any modification or amendment of a
Contract resulting from a bankruptcy proceeding with respect to the Obligor will
not be deemed to have been agreed to by the Servicer hereunder):
(i) in order to (A) change the Obligor's regular due date to a
date within the Collection Period in which such due date occurs or (B) re-
amortize (over the remainder of the original term) the Scheduled Payments
on a Contract following a partial Prepayment (PROVIDED that the sum of such
partial Prepayment and the Contract Principal Balance of the Contract after
the re-amortization is at least equal to the Required Payoff Amount for
such Contract prior to the partial Prepayment), or
(ii) for any other purpose, PROVIDED that no such modification
or amendment shall:
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(A) change the amount or the due date of any Scheduled Payment
(except as provided in clauses (i)(A) and (B) above, Section 3.2(c)(i)
or Section 3.2(d)),
(B) release the related Equipment from the Contract, unless (1)
equipment of equal or greater value is substituted, (2) the remaining
related Equipment has a value at least equal to the Required Payoff
Amount of the Contract, or (3) the release is pursuant to a partial
Prepayment (which, in the case of a partial Prepayment on a Lease
Contract, meets the requirements of Section 3.2(d)) and the ratio of
the value of the related Equipment to the Contract Principal Balance
of the Contract after such Prepayment and release is at least equal to
such ratio prior to such Prepayment and release;
(C) cause any of the representations or warranties contained in
the Contract Representations and Warranties (excluding, for this
purpose, those representations and warranties contained in clauses
(D), (V) (except as such representation or warranty relates to the
requirement that payments be made on the Contract regardless of the
condition or suitability of the related Equipment and notwithstanding
any defense, set-off or counterclaim against the manufacturer, lessor
or lender), (AA) or (BB)) to cease to be true; or
(D) except as provided in clause (ii)(A) above, result in the
Contract Principal Balance or Required Payoff Amount of the Contract
being less than it would have been absent such modification or
amendment.
(c) The Servicer may grant payment extensions on a Contract in
accordance with its credit and collection policies and procedures (it being
acknowledged that any extensions on a Contract resulting from a bankruptcy
proceeding with respect to the Obligor will not be deemed to have been granted
by the Servicer hereunder) if the Servicer believes in good faith that such
extension is necessary to avoid a termination and liquidation of such Contract
and will maximize the amount to be received by the Issuer with respect to such
Contract; PROVIDED, HOWEVER, that:
(i) the aggregate period of all extensions granted on a
Contract shall not exceed six months; and
(ii) in no event may any Contract be extended beyond the
Collection Period immediately preceding the final Stated Maturity Date.
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Nothing in this Section 3.2(c) shall be deemed to prevent the Servicer from
extending or renewing, or otherwise accepting the continued performance by the
Obligor under, a Contract after expiration of its stated term.
(d) The Servicer may, in its discretion, allow a Prepayment, in whole
or in part, of any Lease Contract which, by its terms, is not prepayable, but
only if the amount of such Prepayment (or, in the case of a partial Prepayment,
the sum of such Prepayment and the remaining Contract Principal Balance of the
Lease Contract after application of such Prepayment), together with such
additional amounts as are (i) available to the Servicer for the purpose of
prepaying such Lease Contract (excluding any monies otherwise constituting
Pledged Revenues) and (ii) deposited in the Collection Account contemporaneously
with the deposit therein of such Prepayment, is at least equal to the Required
Payoff Amount for such Lease Contract.
(e) The Servicer shall remit all payments by or on behalf of the
Obligors (other than amounts constituting Administrative Fees) received by the
Servicer to the Servicing Account as soon as practicable, but in no event later
than the second Business Day after receipt thereof.
SECTION 3.3. REALIZATION UPON CONTRACTS. Consistent with the
standards, policies and procedures required by this Agreement, the Servicer
shall, except as provided in the following paragraph, take such action as is
reasonably necessary (including making commercially reasonable efforts to
repossess (or otherwise comparably convert the ownership of) and dispose of the
related Equipment) to collect from the Obligor or otherwise all amounts payable
under any Contract as to which the Obligor is in default in the making of one or
more Scheduled Payments thereunder, if the Servicer has determined such default
is not likely to be cured. The Servicer will not be required to repossess (or
otherwise comparably convert the ownership of) any Equipment the repossession of
which, in accordance with the Servicer's credit and collection policies and
procedures, and based on the Servicer's good faith estimate of the value of the
Equipment and its availability, would not be reasonable. The Servicer is
authorized to follow such customary practices and procedures as it shall deem
necessary or advisable, consistent with the standard of care required by Section
3.1, which practices and procedures may include the sale of the related
Equipment at public or private sale, the submission of claims under an Insurance
Policy and other actions by the Servicer in order to realize upon such a
Contract. The foregoing is subject to the provision that, in any case in which
the Equipment shall have suffered damage, the Servicer shall not expend funds in
connection with any repair or towards the repossession of such Equipment unless
it shall determine in its reasonable judgment that such repair and/or
repossession shall increase the proceeds of liquidation of the related Contract
by an amount greater than the amount of such expenses. All amounts received
upon liquidation of a Contract (except as otherwise provided below), including
any proceeds derived from the disposition of the related Equipment, shall be
remitted by the Servicer to the Servicing Account as soon as practicable, but in
no event later than the second Business Day after receipt thereof. The Servicer
shall, to the extent
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the proceeds of such liquidation are sufficient therefor, be entitled to recover
all reasonable out-of-pocket expenses incurred by it in the course of
liquidating a Contract, which amounts may be retained by the Servicer from such
proceeds (and shall not be required to be deposited as provided in Section
3.2(e)) to the extent of such expenses. The Servicer shall be entitled to
retain in the Servicing Account, from liquidation proceeds, a reserve for out-
of-pocket liquidation expenses in an amount equal to such expenses, in addition
to those previously incurred, as it reasonably estimates will be incurred. Upon
completion of such liquidation, the remainder of any such reserve, after
reimbursement to the Servicer of all out-of-pocket liquidation expenses, shall
constitute Liquidation Proceeds and be transferred as provided in Section
4.2(a). The Servicer shall, in accordance with Section 3.4(f), pay on behalf of
the Issuer and the Depositor any sales, use, personal property and other taxes
assessed on repossessed Equipment, as well as any sales or similar taxes on the
disposition thereof, and shall be entitled to reimbursement of any such tax from
liquidation proceeds with respect to the related Contract as provided in Section
3.4(b).
Although it is intended that the Servicer repossess and dispose of any
Equipment in a commercially reasonable manner with a view to realizing proceeds
at least equal to the fair market value of the Equipment, the Servicer may, in
its discretion, choose to dispose of Equipment through a new lease or in some
other manner which provides for payment for the Equipment over time. In any
such event, the Servicer will be required to pay from its own funds, and deposit
in the Servicing Account, an amount which, in its reasonable judgment, is equal
to the fair market value of such Equipment (less any related out-of-pocket
liquidation expenses), and the Servicer will be entitled to all payments
received thereafter in respect of such Equipment. Any such amounts so deposited
by the Servicer shall be treated as additional Liquidation Proceeds with respect
to the related Contract and Equipment.
SECTION 3.4. INSURANCE, MAINTENANCE AND TAXES.
(a) The Servicer shall establish one or more insurance, maintenance
and tax accounts (collectively, the "Insurance, Maintenance and Tax Accounts")
in the name of the Servicer and for the benefit of the respective Obligors and,
to the extent provided herein, the Issuer and the Depositor. The Servicer shall
deposit into the Insurance, Maintenance and Tax Accounts any payments made by or
on behalf of Obligors which constitute (i) insurance charges paid by an Obligor
to the lessor or secured party under a Contract, (ii) any insurance payments or
recoveries paid by an insurance company or comparable third party and related to
the damage to, or destruction of, the Equipment related to such Contract (unless
paid directly by such insurance company or comparable third party directly to
the Obligor), (iii) any payments made by or on behalf of Obligors which
constitute amounts paid by an Obligor to the lessor or secured party under a
Contract in respect of the maintenance of the related Equipment, and (iv) taxes
paid by the Obligor with respect to the related Contract or Equipment (except
for any such payments in respect of taxes which were paid by the applicable
Originator prior to the Cut-Off Date, which payments shall
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constitute Scheduled Payments hereunder). None of the foregoing payments shall
constitute Pledged Revenues except under the circumstances described in clause
(c)(ii) below.
(b) The Servicer may pay from its own funds, or may withdraw amounts
from the Insurance, Maintenance and Tax Accounts, when and if appropriate, to
pay, when due (i) all insurance charges in the amounts received under clause
(a)(i) above, (ii) any amounts payable under any applicable maintenance contract
or otherwise with respect to the maintenance of the related Equipment in the
amounts received under clause (a)(iii) above, and (iii) all taxes in the amounts
received under clause (a)(iv) above. If the Servicer has paid any such
insurance charges, maintenance costs or taxes from its own funds (including any
such amounts that may have been paid prior to the Closing Date), the Servicer
shall be entitled to reimbursement therefor from any appropriate amounts
available therefor in the Insurance, Maintenance and Tax Accounts, from payments
thereafter received from the applicable Obligor in respect thereof or from
liquidation proceeds in the event such Contract is liquidated. The Servicer is
authorized in its discretion to waive its right to receive reimbursement of any
such amount.
(c) Amounts on deposit in the Insurance, Maintenance and Tax Accounts
which represent amounts received by the Servicer pursuant to clause (a)(ii)
above shall be applied by the Servicer as follows: (i) if equipment is
purchased to replace the Equipment that was damaged or destroyed, and such
replacement equipment is (in the reasonable opinion of the Servicer) of
comparable use and equivalent value to the Equipment that was damaged or
destroyed, or if the Equipment is to be repaired, the Servicer shall release
such amount so received from the insurance company or comparable third party in
payment or reimbursement for such replacement equipment or such repair; and (ii)
if such replacement option is not exercised or the Equipment is not to be
repaired, then the Servicer shall treat such amount as Liquidation Proceeds and
(A) if the related Contract is a Loan Contract, transfer such amount from the
Insurance, Maintenance and Tax Accounts to the Collection Account, and (B) if
the related Contract is a Lease Contract, (I) transfer that portion thereof
which is allocated to the Issuer (as described in the second sentence of the
definition of "Liquidation Proceeds") from the Insurance, Maintenance and Tax
Accounts to the Collection Account, and (II) distribute the balance thereof from
the Insurance, Maintenance and Tax Accounts to the Depositor.
(d) The Servicer may sue to enforce or collect upon the Insurance
Policies, in its own name, if possible, or as agent of the Issuer and the
Depositor. If the Servicer elects to commence a legal proceeding to enforce an
Insurance Policy, the act of commencement shall be deemed to be an automatic
assignment of the rights of the Issuer and the Depositor under such Insurance
Policy to the Servicer for purposes of collection only. If, however, in any
enforcement suit or legal proceeding it is held that the Servicer may not
enforce an Insurance Policy on the grounds that it is not a real party in
interest or a holder entitled to enforce the Insurance Policy, the Owner
Trustee,
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on behalf of the Issuer and the Depositor, shall take such steps as the Servicer
deems necessary to enforce such Insurance Policy, including bringing suit in its
name or the name of the Owner Trustee for the benefit of the Equity
Certificateholders and the Depositor and the Indenture Trustee for the benefit
of the Noteholders.
(e) Consistent with its customary standards, policies and procedures,
with respect to each Contract, the Servicer shall maintain insurance against
casualty loss with respect to any Equipment financed by or leased pursuant to
the Contract, to the extent the Contract requires the lessor or secured party
under the Contract to maintain such insurance, and shall otherwise require the
Obligor under the Contract to maintain such insurance, to the extent the
Contract requires that such insurance be maintained by the Obligor. The
Servicer shall not otherwise be liable to the Owner Trustee, the Indenture
Trustee, the Depositor or any Noteholder or Equity Certificateholder for any
casualty loss with respect to any Equipment related to a Contract, except to the
extent otherwise explicitly provided in this Agreement.
(f) The Servicer shall determine and pay when due all sales, use,
personal property and other taxes payable in respect of the Equipment related to
each Contract. To the extent the Servicer has previously received from the
related Obligor payments with respect to such taxes and has deposited such
payments in the Insurance, Maintenance and Tax Accounts in accordance with
clause (a)(iv) above, the Servicer shall, in accordance with clause (b)(iii)
above, either (i) pay such taxes from amounts withdrawn from the Insurance,
Maintenance and Tax Accounts, or (ii) pay such taxes from its own funds and
thereafter reimburse itself from amounts withdrawn from the Insurance,
Maintenance and Tax Accounts. In the event the Servicer has not previously
received payments from the Obligor for this purpose, or to the extent any such
payments received were insufficient to pay the taxes due, the Servicer shall
nonetheless pay such taxes from its own funds and shall bill the Obligor for any
amounts so paid. The Servicer shall be entitled to reimbursement for any taxes
so paid from its own funds, as provided in clause (b)(iii) above. Failure on
the part of the Servicer to perform its duties in a timely fashion under this
clause shall constitute a breach of this Agreement by the Servicer for which
indemnity will be available in accordance with Section 7.1.
(g) The Servicer shall give prompt written notice to the Indenture
Trustee of the Servicer's failure to pay when due any insurance charge or tax
payment required to be paid pursuant to this Section 3.4 and the reason for such
failure. Upon receipt of any such notice, or if the Indenture Trustee has
otherwise received notice of any such failure to pay an insurance charge or tax
payment, the Indenture Trustee shall take such actions as are reasonably
necessary (including the withdrawal of monies, if any, available therefor in the
Insurance, Maintenance and Tax Accounts and attributable to payments previously
made by the related Obligor and payment of such insurance charge or tax payment)
to cause any such amounts to be paid. The Indenture Trustee shall be permitted
to withdraw monies from the Insurance, Maintenance and
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Tax Accounts for purposes of performing its obligations under this paragraph,
but shall not, in any event, be required to use its own funds for such purposes.
SECTION 3.5. MAINTENANCE OF SECURITY INTERESTS IN EQUIPMENT. To the
extent the Servicer's credit and collection policies and procedures in this
regard would so require (it being acknowledged that, in certain instances, such
credit and collection policies and procedures would not so require), the
Servicer shall take such steps as are necessary to maintain perfection of any
security interest created by each Contract in the related Equipment on behalf of
the Issuer and the Depositor, including, but not limited to, obtaining the
execution by the Obligors and the recording, registering, filing, re-recording,
re-filing, and re-registering of all security agreements, financing statements
and continuation statements as are necessary to maintain such security interest
granted by the Obligors under the respective Contracts. The Owner Trustee
hereby authorizes the Servicer, and the Servicer agrees (to the extent the
Servicer's credit and collection policies and procedures in this regard would so
require), to take any and all steps necessary to re-perfect such security
interest on behalf of the Issuer and the Depositor as necessary because of the
relocation of Equipment or for any other reason.
SECTION 3.6. COVENANTS, REPRESENTATIONS, AND WARRANTIES OF SERVICER.
By its execution and delivery of this Agreement, the Servicer makes the
following representations, warranties and covenants.
(a) The Servicer covenants as follows:
(i) LIENS IN FORCE. The Equipment securing each Contract
shall not be released in whole or in part from any interest the lessor
or secured party may have in such Equipment under the terms of the
Contract, except upon payment in full of the Contract or as otherwise
contemplated herein;
(ii) NO IMPAIRMENT. The Servicer shall do nothing to
impair the rights of the Issuer, the Equity Certificateholders, the
Depositor or the Noteholders in the Contracts, the Insurance Policies
or the other Trust Assets; and
(iii) NO AMENDMENTS. The Servicer shall not extend or
otherwise amend the terms of any Contract with respect to the
Scheduled Payments thereon, except (A) in accordance with Section 3.2,
or (B) at such time as the Notes and the Equity Certificates are no
longer Outstanding, with the consent of the Owner Trustee.
(b) The Servicer represents, warrants and covenants as of the
date of execution and delivery of this Agreement:
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(i) ORGANIZATION AND GOOD STANDING. The Servicer has
been duly organized and is validly existing and in good standing under
the laws of its jurisdiction of organization, with power, authority
and legal right to own its properties and to conduct its business as
such properties are currently owned and such business is currently
conducted, and had at all relevant times, and now has, power,
authority and legal right to enter into and perform its obligations
under this Agreement and the Servicer's Related Documents;
(ii) DUE QUALIFICATION. The Servicer is duly qualified to
do business as a foreign corporation in good standing, and has
obtained all necessary licenses and approvals, in all jurisdictions
where the failure to do so would materially and adversely affect the
performance of its obligations under this Agreement and the Related
Documents;
(iii) POWER AND AUTHORITY. The Servicer has the power and
authority to execute and deliver this Agreement and to carry out the
terms hereof; and the execution, delivery and performance of this
Agreement and the Servicer's Related Documents have been duly
authorized by the Servicer by all necessary corporate action;
(iv) BINDING OBLIGATION. This Agreement and the
Servicer's Related Documents shall each constitute the legal, valid
and binding obligation of the Servicer enforceable in accordance with
its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally and by equitable
limitations on the availability of specific remedies, regardless of
whether such enforceability is considered in a proceeding in equity or
at law;
(v) NO VIOLATION. The execution and delivery of this
Agreement, the consummation of the transactions contemplated by this
Agreement and the Servicer's Related Documents, and the fulfillment of
the terms hereof, shall 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, or both) a default under, the articles of
incorporation or bylaws of the Servicer, or any indenture, agreement,
mortgage, deed of trust or other instrument to which the Servicer is a
party or by which it is bound, or result in the creation or imposition
of any Lien upon any of its properties pursuant to the terms of any
such indenture, agreement, mortgage, deed of trust or other
instrument, other than this Agreement or any Related Document, or
violate any law, order, rule or regulation applicable to the Servicer
of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Servicer or any of its properties;
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(vi) NO PROCEEDINGS. There are no proceedings or
investigations pending or, to the Servicer's knowledge, threatened
against the Servicer, before any court, regulatory body,
administrative agency or other tribunal or governmental
instrumentality having jurisdiction over the Servicer or its
properties (A) asserting the invalidity of this Agreement or any of
the Servicer's Related Documents, (B) seeking to prevent the issuance
of the Equity Certificates or the Notes or the consummation of any of
the transactions contemplated by this Agreement or any of the
Servicer's Related Documents, or (C) seeking any determination or
ruling that might materially and adversely affect the performance by
the Servicer of its obligations under, or the validity or
enforceability of, this Agreement or any of the Servicer's Related
Documents or (D) seeking to adversely affect (i) the federal income
tax or other federal, state or local tax attributes of the Equity
Certificates or the Notes or (ii) the federal, state or local tax
treatment of any of the transactions contemplated by this Agreement
and the Related Documents; and
(vii) NO CONSENTS. The Servicer is not required to obtain
the consent of any other party or any consent, license, approval or
authorization, or registration or declaration with, any governmental
authority, bureau or agency in connection with the execution,
delivery, performance, validity or enforceability of this Agreement or
any of the Servicer's Related Documents.
SECTION 3.7. SUB-SERVICERS. The Servicer may, without the Owner
Trustee's or the Indenture Trustee's consent, maintain or enter into one or more
agreements with Sub-Servicers for the servicing and administration of the
Contracts by such Sub-Servicers. Notwithstanding the terms or existence of any
such agreement between the Servicer and a Sub-Servicer, the Servicer shall not
be relieved of any of its obligations under this Agreement by reason of such
agreement and shall be obligated to the same extent and under the same terms and
conditions as if the Servicer alone was servicing and administering the
Contracts, and neither the Owner Trustee nor the Indenture Trustee shall have
any obligation to deal with anyone other than the Servicer with respect to the
servicing of the Contracts.
SECTION 3.8. TOTAL SERVICING FEE; PAYMENT OF EXPENSES BY SERVICER.
On each Payment Date, the Servicer shall be entitled to receive out of the
Collection Account the Servicing Fee (less that portion thereof to be retained
and applied by the Trustee in accordance with the Cash Collateral Account
Agreement) for the related Collection Period pursuant to Section 8.03(i) of the
Indenture. The Servicer shall be entitled to retain, as additional servicing
compensation under this Agreement, any Administrative Fees and any earnings on
the investment of amounts in the Servicing Account. The Servicer shall be
required to pay all expenses incurred by it in connection with its activities
under this Agreement (including taxes imposed on the Servicer and all expenses
incurred in connection with reports to Equity Certificateholders and
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Noteholders). In addition, the Servicer (i) shall pay to the Indenture Trustee,
and the Indenture Trustee shall be entitled to, certain annual fees and shall
reimburse the Indenture Trustee for all ordinary and reasonable out-of-pocket
expenses incurred or made by it in connection with the performance of its duties
under the Indenture (excluding those incurred or made in the performance of its
duties under Article V of the Indenture, as referred to in Section 6.07(b) of
the Indenture), (ii) shall pay to the Owner Trustee, and the Owner Trustee shall
be entitled to, certain annual fees and shall reimburse the Owner Trustee for
all ordinary and reasonable out-of-pocket expenses incurred or made by it in
connection with the performance of its duties under the Trust Agreement and
(iii) shall pay to the Luxembourg Paying Agent and the Luxembourg Listing Agent
(collectively, the "Luxembourg Agents"), and the Luxembourg Agents shall be
entitled to, certain annual fees and shall reimburse the Luxembourg Agents for
all ordinary and reasonable out-of-pocket expenses incurred or made by them in
connection with the performance of their duties under the Indenture. Such
expenses shall include the reasonable compensation and expenses, disbursements
and advances of the agents, counsel, accountants and experts of the Indenture
Trustee, the Owner Trustee and the Luxembourg Agents, as appropriate.
SECTION 3.9. SERVICER'S CERTIFICATE. No later than 10:00 a.m. New
York City time on each Determination Date, the Servicer shall deliver to the
Owner Trustee, the Indenture Trustee and each Rating Agency a Servicer's
Certificate executed by a Responsible Officer of the Servicer containing, among
other things, (i) all information necessary to enable the Indenture Trustee to
make the withdrawals and distributions required by Sections 8.03 and 8.06 of the
Indenture (including, for purposes of making withdrawals from the Cash
Collateral Account pursuant to Section 8.06(c) of the Indenture, notice to the
Indenture Trustee of any amounts to be so withdrawn which have not resulted,
directly or indirectly, from delinquencies or defaults, or both, on the
Contracts), (ii) all information necessary to enable the Indenture Trustee to
send the statements to Noteholders and Equity Certificateholders required by
Section 7.05 of the Indenture, and (iii) all information necessary to enable the
Indenture Trustee to reconcile all deposits to, and withdrawals from, the
Servicing Account and the Collection Account for the related Collection Period
and Payment Date, including the accounting required by Section 4.4. Contracts
purchased by TCC on the related Deposit Date or by the Depositor on the related
Accounting Date, and each Contract which became a Liquidated Contract or which
was paid in full during the related Collection Period, shall be identified by
account number (as set forth in the Schedule of Contracts). A copy of such
certificate may be obtained by any Equity Certificateholder or Noteholder (or by
any Note Owner, upon certification that such Person is a Note Owner and payment
of any expenses associated with the distribution thereof) by a request in
writing to the Indenture Trustee addressed to the Corporate Trust Office.
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SECTION 3.10. ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF SERVICER
TERMINATION EVENT.
(a) The Servicer shall deliver to the Owner Trustee, the Indenture
Trustee and each Rating Agency, on or before March 31 (or 90 days after the end
of the Servicer's fiscal year, if other than December 31) of each year,
beginning on March 31, 1997, a certificate signed by any Responsible Officer of
the Servicer, dated as of December 31 (or other applicable date) of the
immediately preceding year, stating that (i) a review of the activities of the
Servicer during the preceding 12-month period (or such other period as shall
have elapsed from the Closing Date to the date of the first such certificate)
and of its performance under this Agreement has been made under such officer's
supervision, and (ii) to such officer's knowledge, based on such review, the
Servicer has fulfilled all its obligations under this Agreement throughout such
period, or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer and the nature
and status thereof.
(b) The Servicer shall deliver to the Owner Trustee, the Indenture
Trustee and each Rating Agency, promptly after having obtained knowledge
thereof, but in no event later than two Business Days thereafter, written notice
in a certificate signed by any Responsible Officer of the Servicer of any event
which with the giving of notice or lapse of time, or both, would become a
Servicer Termination Event under Section 8.1(a). The Depositor or the Servicer
shall deliver to the Owner Trustee, the Indenture Trustee, the Servicer or the
Depositor (as applicable) and each Rating Agency promptly after having obtained
knowledge thereof, but in no event later than three Business Days thereafter,
written notice in a certificate signed by any Responsible Officer of the
Servicer of any event which with the giving of notice or lapse of time, or both,
would become a Servicer Termination Event under any other clause of Section 8.1.
SECTION 3.11. ANNUAL INDEPENDENT ACCOUNTANTS' REPORT.
(a) The Servicer shall cause a firm of nationally recognized
independent certified public accountants (the "Independent Accountants"), who
may also render other services to the Servicer, to deliver to the Owner Trustee,
the Indenture Trustee and each Rating Agency, on or before March 31 (or 90 days
after the end of the Servicer's fiscal year, if other than December 31) of each
year, beginning on March 31, 1997, with respect to the twelve months ended the
immediately preceding December 31 (or other applicable date) (or such other
period as shall have elapsed from the Closing Date to the date of such
certificate), a statement (the "Accountant's Report") addressed to the Board of
Directors of the Servicer, to the Owner Trustee and to the Indenture Trustee, to
the effect that such firm has audited the financial statements of the Servicer
and issued its report thereon and that such audit was made in accordance with
generally accepted auditing standards, and accordingly included such tests of
the accounting records and such other auditing procedures as such firm
considered necessary in the circumstances, including procedures as determined by
the Independent Accountants related to (i) the documents and records concerning
the servicing of
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equipment lease contracts, installment sale contracts, promissory notes, loan
and security agreements and/or other similar types of receivables under
servicing agreements substantially similar one to another (such Accountant's
Report to have attached thereto a schedule setting forth the servicing
agreements covered thereby, including this Agreement); and (ii) the delinquency
and loss statistics relating to the Servicer's portfolio of equipment lease
contracts, installment sale contracts, promissory notes, loan and security
agreements and/or other similar types of receivables; and except as described in
the Accountant's Report, disclosed no exceptions or errors in the records
relating to the contracts serviced for others that, in the firm's opinion,
generally accepted auditing standards requires such firm to report. The
Accountant's Report shall further state that (1) a review of certain agreed upon
procedures was performed with respect to two randomly selected Servicer's
Certificates during the applicable period, and (2) except as disclosed in the
Report, no exceptions or errors in the Servicer's Certificates so examined were
found.
(b) The Accountants' Report shall also indicate that the firm is
independent of the Depositor and the Servicer within the meaning of the Code of
Professional Ethics of the American Institute of Certified Public Accountants.
(c) A copy of the Accountants' Report may be obtained by any Equity
Certificateholder or Noteholder (or by any Note Owner, upon certification that
such Person is a Note Owner and payment of any expenses associated with the
distribution thereof) by a request in writing to the Indenture Trustee addressed
to the Corporate Trust Office.
SECTION 3.12. ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION
REGARDING CONTRACTS. The Servicer shall provide to representatives of the Owner
Trustee and the Indenture Trustee reasonable access to the documentation
regarding the Contracts. In each case, such access shall be afforded without
charge but only upon reasonable request and during normal business hours.
Nothing in this Section shall derogate from the obligation of the Servicer to
observe any applicable law, rule or contractual provision with an Obligor
prohibiting disclosure of information regarding the Obligors, and the failure of
the Servicer to provide access as provided in this Section as a result of such
obligation shall not constitute a breach of this Section.
SECTION 3.13. CERTAIN DUTIES OF THE SERVICER UNDER THE TRUST
AGREEMENT. The Servicer shall, and hereby agrees that it will, monitor the
Issuer's compliance with all applicable provisions of federal securities laws,
notify the Issuer of any actions to be taken by the Issuer necessary for
compliance with such laws and prepare on behalf of the Issuer all notices,
filings or other documents or instruments required to be filed under such laws.
SECTION 3.14. DUTIES OF THE SERVICER UNDER THE INDENTURE. The
Servicer shall, and hereby agrees that it will, perform on behalf of the Issuer
and the Owner
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Trustee the following duties of the Issuer or the Owner Trustee, as applicable,
under the Indenture (references are to the applicable Sections in the
Indenture):
(a) the direction to the Paying Agents, if any, to deposit
moneys with the Indenture Trustee (Section 3.03);
(b) the obtaining and preservation of the Issuer's qualification
to do business in each jurisdiction in which such qualification is or shall
be necessary to protect the validity and enforceability of the Indenture,
the Notes and each other instrument and agreement included in the Trust
Estate (Section 3.04);
(c) the preparation of all supplements, amendments, financing
statements, continuation statements, instruments of further assurance and
other instruments, in accordance with Section 3.05 of the Indenture,
necessary to protect the Trust Estate (Section 3.05);
(d) the annual delivery of Opinions of Counsel, in accordance
with Section 3.06 of the Indenture, as to the Trust Estate, and the annual
delivery of the Officers' Certificate and certain other statements, in
accordance with Section 3.09 of the Indenture, as to compliance with the
Indenture (Sections 3.06 and 3.09);
(e) the preparation and obtaining of documents and instruments
required for the release of the Issuer from its obligations under the
Indenture (Section 4.01);
(f) the monitoring of the Issuer's obligations as to the
satisfaction and discharge of the Indenture and the preparation of an
Officers' Certificate and the obtaining of the Opinion of Counsel and the
Independent Certificate relating thereto (Section 4.01);
(g) the preparation of any written instruments required to
confirm more fully the authority of any co-trustee or separate trustee and
any written instruments necessary in connection with the resignation or
removal of any co-trustee or separate trustee (Sections 6.08 and 6.11);
(h) the opening of one or more accounts in the Issuer's name,
the preparation of Issuer Orders, Officers' Certificates and Opinions of
Counsel and all other actions necessary with respect to investment and
reinvestment of funds in the Trust Accounts (Sections 8.02, 8.04 and 8.05);
(i) the determination, and giving notice, of the amounts, if
any, specified in clauses (i) through (iii) of Section 8.06(c) of the
Indenture for each Payment Date (Section 8.06);
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(j) the preparation of Issuer Orders and the obtaining of
Opinions of Counsel with respect to the execution of supplemental
indentures (Sections 9.01, 9.02 and 9.03);
(k) the preparation of all Officers' Certificates, Opinions of
Counsel and Independent Certificates with respect to any requests by the
Issuer to the Indenture Trustee to take any action under the Indenture
(Section 11.01); and
(l) the recording of the Indenture, if applicable (Section
11.15).
SECTION 3.15. FIDELITY BOND. Within 30 days after the Closing Date,
the Servicer shall obtain, and shall thereafter maintain, (i) a policy or
policies of insurance covering errors and omissions by the Servicer, and (ii) a
fidelity bond. Such policy or policies and such fidelity bond shall be in such
form and amount as is generally customary among persons that service a portfolio
of equipment lease contracts, installment sale contracts, promissory notes, loan
and security agreements and/or other similar types of receivables having an
unpaid balance of at least $100,000,000 and which are generally regarded as
servicers acceptable to institutional investors. Each such policy shall name
the Issuer, the Indenture Trustee and the Depositor as parties insured
thereunder as their respective interests may appear.
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ARTICLE IV
COLLECTIONS AND DEPOSITS
SECTION 4.1. INITIAL DEPOSIT. On the Closing Date, the Servicer
shall deposit in the Servicing Account (i) all Scheduled Payments and
Prepayments of Contracts received by the Servicer on or after the Cut-Off Date
(including those Scheduled Payments due prior to, but not received as of, the
Cut-Off Date, but excluding those Scheduled Payments due on or after, but
received prior to, the Cut-Off Date) and on or prior to the second Business Day
immediately preceding such date and (ii) all Liquidation Proceeds (including
proceeds of Insurance Policies to be treated as such in accordance with Section
3.4) realized in respect of the Contracts and related Equipment and applied by
the Servicer after the Cut-Off Date.
SECTION 4.2. COLLECTIONS.
(a) Pursuant to the Indenture, the Indenture Trustee has established
the Servicing Account. The Servicer shall make deposits to and transfers from
the Servicing Account, and shall be entitled to make withdrawals therefrom, as
provided in this Agreement. The Servicer shall remit to the Servicing Account
all payments by or on behalf of the Obligors on the Contracts (other than
amounts constituting Administrative Fees) and all Liquidation Proceeds
(including (1) proceeds of Insurance Policies to be treated as such in
accordance with Section 3.4 and (2) deficiency amounts paid by the Servicer with
respect to the disposition of Equipment to be treated as such in accordance with
the last paragraph of Section 3.3) received by the Servicer, in each case, as
soon as practicable, but in no event later than the second Business Day after
receipt thereof. Within three Business Days after the deposit of such payments
and proceeds therein, the Servicer shall transfer all amounts credited to the
Servicing Account on account of such payments and proceeds (i) to the extent
they constitute Pledged Revenues, to the Collection Account, and (ii) to the
extent they represent amounts allocated to the Depositor, to the Depositor.
Notwithstanding the foregoing, the Servicer may utilize an alternative
remittance schedule acceptable to the Servicer if the Servicer provides to the
Indenture Trustee written confirmation from each Rating Agency that such
alternative remittance schedule will not result in the downgrading or withdrawal
by the Rating Agency of the rating then assigned to the Notes or the Equity
Certificates. Amounts from time to time in the Servicing Account shall be
invested in accordance with Section 8.07 of the Indenture, and the Servicer
shall be entitled to any earnings on such investments as additional servicing
compensation hereunder. In the event of any losses on such investments, the
Servicer shall deposit in the Servicing Account the amount thereof, net of any
earnings otherwise distributable to the Servicer.
(b) The Servicer shall remit to the Collection Account (i) that
portion of any Purchase Amount relating to the Required Payoff Amount received
by the Servicer upon the purchase by TCC of any Contract pursuant to Section
2.6, and (ii) that portion
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of the amount paid by the Depositor to purchase the Contracts pursuant to
Section 5.1 as is required to be deposited in the Collection Account pursuant to
such Section.
(c) Notwithstanding the provisions of subsections (a) and (b) hereof,
the Servicer will be entitled to be reimbursed from amounts on deposit in the
Servicing Account or the Collection Account with respect to a Collection Period
for amounts previously deposited in the Servicing Account or the Collection
Account but later determined by the Servicer in good faith to (i) have resulted
from mistaken deposits or postings or checks returned for insufficient funds, or
(ii) be required to be repaid to an Obligor. The amount to be reimbursed
hereunder may be retained pursuant to Section 4.4 at any time or may otherwise
be paid to the Servicer on the related Payment Date pursuant to Section 8.03(i)
of the Indenture upon certification by the Servicer of such amounts and the
provision of such information to the Indenture Trustee as may be necessary to
verify the accuracy of such certification.
(d) The Servicer shall remit directly to the Depositor that portion
of any Purchase Amount relating to the Book Value of any Leased Equipment
received by the Servicer upon the purchase by TCC of any Contract pursuant to
Section 2.6.
SECTION 4.3. APPLICATION OF COLLECTIONS. For the purposes of this
Agreement, all collections for a Collection Period shall be applied by the
Servicer as follows:
(a) With respect to each Contract, payments by or on behalf of
the Obligor thereof (other than Administrative Fees with respect to such
Contract, to the extent collected) shall be applied to Scheduled Payments
and Prepayments in accordance with the terms of such Contract and the
Servicer's credit and collection policies and procedures. With respect to
each Liquidated Contract, that portion of the Liquidation Proceeds
allocated to the Issuer shall be applied, for purposes of this Agreement
and the Indenture only, to Scheduled Payments and Prepayment on the
Contract as if the Liquidation Proceeds had been paid by the Obligor on the
Accounting Date, and then to any other amounts due and payable with respect
to such Contract. The Servicer shall not be entitled to any Administrative
Fees with respect to a Liquidated Contract unless the Required Payoff
Amount for such Contract has been deposited in the Collection Account.
(b) With respect to each Contract that has become a Purchased
Contract as of any Deposit Date, that portion of the Purchase Amount
relating to the Required Payoff Amount shall be applied, for purposes of
this Agreement and the Indenture only, to Scheduled Payments and Prepayment
on the Contract as if the Purchase Amount had been paid by the Obligor on
the related Accounting Date. All payments by or on behalf of an Obligor
received with respect to any Purchased Contract after the Accounting Date
immediately
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preceding the Deposit Date on which the Purchase Amount was paid by TCC,
shall be paid to TCC and shall not be included in Pledged Revenues.
(c) With respect to each Contract that has been purchased by the
Depositor pursuant to Section 5.1, the purchase price shall be applied, for
purposes of this Agreement and the Indenture only, to Scheduled Payments
and Prepayments on the Contract as if such purchase price had been paid by
the Obligor on the Accounting Date. All payments by or on behalf of an
Obligor received with respect to any Contract so purchased after the
Accounting Date on which the purchase price was paid by the Depositor,
shall be paid to the Depositor and shall not be included in the Amount
Available.
SECTION 4.4. NET DEPOSITS. So long as no Servicer Termination Event
shall have occurred and be continuing with respect to the Servicer, the Servicer
may make the remittances or transfers to be made by it pursuant to Section 4.2
net of amounts (which amounts may be netted prior to any such remittance or
transfer) that would otherwise be distributed to it pursuant to Section 8.03(i)
of the Indenture; PROVIDED, HOWEVER, that the Servicer shall account for all of
such amounts in the related Servicer's Certificate as if such amounts were
deposited and distributed separately; and PROVIDED, FURTHER, that the amounts
that would otherwise be distributed to the Servicer pursuant to Section 8.03(i)
of the Indenture shall not include that portion of the Servicing Fee for the
related Collection Period to be applied by the Indenture Trustee in accordance
with the Cash Collateral Account Agreement. If an error is made by the Servicer
in calculating the amount to be deposited or retained by it, with the result
that an amount less than required is deposited in the Collection Account, the
Servicer shall make a payment of the deficiency to the Collection Account
immediately upon becoming aware, or receiving notice from the Indenture Trustee,
of such error.
SECTION 4.5. EXPIRATION OF LEASE CONTRACTS. In the case of any Lease
Contract which has reached the end of its Original Term, is not in default and
as to which, in accordance with the terms of such Lease Contract, the lessor
thereunder is entitled to the related Equipment, the Servicer shall take such
action as the Depositor shall direct to cause title to such Equipment in the
Depositor to be free and clear of any Liens created by this Agreement or any
Related Document. Any payments thereafter made by the Obligor in respect of
such Equipment, whether on the related Lease Contract or otherwise, shall be the
property of the Depositor or its designated assignee.
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ARTICLE V
TERMINATION
SECTION 5.1. OPTIONAL PURCHASE OF ALL CONTRACTS; LIQUIDATION OF TRUST
ASSETS.
(a) At such time as the sum of the Aggregate Principal Balance of the
Notes and the Equity Certificate Balance is less than 10% of the Cut-Off Date
Contract Pool Principal Balance, the Depositor shall have the option to purchase
the corpus of the Issuer (excluding any rights the Issuer may have with respect
to the Cash Collateral Account); PROVIDED, HOWEVER, that the amount to be paid
for such purchase (as set forth in the following sentence) shall, in any event,
be sufficient to pay the full amount of unpaid principal of and interest payable
on the Notes and the Equity Certificates on the related Payment Date. To
exercise such option, Depositor shall, on any Accounting Date, pay to the
Servicer the aggregate purchase price for the Contracts (which shall be an
amount equal to the sum of the Required Payoff Amounts for all of the
Contracts), plus the appraised value of any other property (including the right
to receive any future recoveries) held as part of the Issuer, such appraisal to
be conducted by an appraiser mutually agreed upon by the Depositor and the
Indenture Trustee (or, if the Notes are no longer Outstanding, the Owner
Trustee), and shall succeed to all interests in and to the Trust Assets. The
fees and expenses related to such appraisal shall be paid by the Depositor. The
Servicer shall immediately deposit the purchase price so paid into the
Collection Account, to be treated as Available Pledged Revenues and distributed
in accordance with Section 8.03 of the Indenture.
(b) Notice of any termination of the Issuer shall be given by the
Servicer to the Owner Trustee and the Indenture Trustee as soon as practicable
(but in no event more than three Business Days) after the Servicer has received
notice thereof.
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ARTICLE VI
THE DEPOSITOR
SECTION 6.1. LIABILITY OF DEPOSITOR. The Depositor shall be liable
hereunder only to the extent of the obligations in this Agreement specifically
undertaken by the Depositor and the representations made by the Depositor.
SECTION 6.2. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, DEPOSITOR; AMENDMENT OF CERTIFICATE OF INCORPORATION.
(a) The Depositor shall not merge or consolidate with any other
Person or permit any other Person to become the successor to the Depositor's
business except in accordance with the requirements of this Section. The
certificate of incorporation of any corporation (i) into which the Depositor may
be merged or consolidated, (ii) resulting from any merger or consolidation to
which the Depositor shall be a party, or (iii) succeeding to the business of
Depositor, shall contain provisions relating to limitations on business and
other matters substantively identical to those contained in the Depositor's
certificate of incorporation. Any such successor corporation shall execute an
agreement of assumption of every obligation of the Depositor under this
Agreement and each Related Document and, whether or not such assumption
agreement is executed, shall be the successor to the Depositor under this
Agreement without the execution or filing of any document or any further act on
the part of any of the parties to this Agreement. The Depositor shall provide
prompt notice of any merger, consolidation or succession pursuant to this
Section 6.2 to the Owner Trustee, the Indenture Trustee and the Rating Agencies.
Notwithstanding the foregoing, the Depositor shall not merge or consolidate with
any other Person or permit any other Person to become a successor to the
Depositor's business, unless (w) immediately after giving effect to such
transaction, no representation or warranty made pursuant to Section 2.4 shall
have been breached (for purposes hereof, such representations and warranties
shall speak as of the date of the consummation of such transaction) and no event
that, after notice or lapse of time, or both, would become an Event of Default
or a Servicer Termination Event shall have occurred and be continuing, (x) the
Depositor shall have delivered to the Owner Trustee and the Indenture Trustee a
certificate of a Responsible Officer of the Depositor and an Opinion of Counsel
each stating that such consolidation, merger or succession and such agreement of
assumption comply with this Section 6.2 and that all conditions precedent, if
any, provided for in this Agreement relating to such transaction have been
complied with, (y) the Depositor shall have delivered to the Owner Trustee and
the Indenture Trustee an Opinion of Counsel, stating that, in the opinion of
such counsel, either (A) all financing statements and continuation statements
and amendments thereto have been executed and filed that are necessary to
preserve and protect the interest of the Issuer in the Trust Assets and reciting
the details of the filings or (B) no such action shall be necessary to preserve
and protect such interest, and (z) the Rating Agency Condition shall have been
satisfied.
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(b) The Depositor hereby agrees that it shall not (i) take any action
prohibited by Article XVI of its certificate of incorporation or (ii) without
the prior written consent of the Owner Trustee and the Indenture Trustee and
without satisfaction of the Rating Agency Condition, amend Article III, Article
IX, Article XIV or Article XVI of its certificate of incorporation.
SECTION 6.3. LIMITATION ON LIABILITY OF DEPOSITOR AND OTHERS. The
Depositor and any director or officer or employee or agent of the Depositor may
rely in good faith on the advice of counsel or on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising under this Agreement. The Depositor shall not be under any obligation
to appear in, prosecute or defend any legal action that is not incidental to its
obligations as transferor of the Contracts under this Agreement and that in its
opinion may involve it in any expense or liability.
SECTION 6.4. DEPOSITOR MAY OWN EQUITY CERTIFICATES OR NOTES. Each of
the Depositor and any Affiliate of the Depositor may in its individual or any
other capacity become the owner or pledgee of Equity Certificates or Notes with
the same rights as it would have if it were not the Depositor or an Affiliate
thereof except as otherwise specifically provided herein or in the Related
Documents. Equity Certificates or Notes so owned by or pledged to the Depositor
or such Affiliate shall have an equal and proportionate benefit under the
provisions of this Agreement or any Related Document, without preference,
priority, or distinction as among all of the Equity Certificates or Notes;
PROVIDED that any Equity Certificates or Notes owned by the Depositor or any
Affiliate thereof, during the time such Equity Certificates or Notes are owned
by them, shall be without voting rights for any purpose set forth in this
Agreement or any Related Document (it being acknowledged that any Equity
Certificate held by the Revolving Trust Trustee shall not be deemed to be owned
by the Depositor or an Affiliate of the Depositor for this purpose). The
Depositor shall notify the Owner Trustee and the Indenture Trustee promptly
after it or any of its Affiliates become the owner or pledgee of an Equity
Certificate or a Note.
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ARTICLE VII
THE SERVICER
SECTION 7.1. LIABILITY OF SERVICER; INDEMNITIES.
(a) The Servicer (in its capacity as such and, in the case of TCC,
without limitation of its obligations under the Purchase Agreement) shall be
liable hereunder only to the extent of the obligations in this Agreement
specifically undertaken by the Servicer and the representations made by the
Servicer.
(b) The Servicer shall indemnify, defend and hold harmless the
Issuer, the Owner Trustee, the Indenture Trustee, the Depositor, their
respective officers, directors, agents and employees, the Equity
Certificateholders and the Noteholders from and against any and all costs,
expenses, losses, claims, damages and liabilities to the extent that such cost,
expense, loss, claim, damage or liability arose out of, or was imposed upon the
Issuer, the Owner Trustee, the Indenture Trustee, the Depositor, the Equity
Certificateholders or the Noteholders through the Servicer's breach of this
Agreement, the gross negligence, willful misfeasance or bad faith of the
Servicer in the performance of its duties under this Agreement or by reason of
reckless disregard of its obligations and duties under this Agreement.
(c) The Servicer shall indemnify, defend and hold harmless the Owner
Trustee, in its individual capacity, its officers, directors, agents and
employees, from and against all costs, taxes (other than income taxes on fees
and expenses payable to the Owner Trustee), expenses, losses, claims, damages
and liabilities arising out of or incurred in connection with the acceptance or
performance of the trusts and duties contained in the Trust Agreement and the
Related Documents, except to the extent that such cost, taxes (other than income
taxes), expense, loss, claim, damage or liability (A) is due to the willful
misfeasance or gross negligence of the Owner Trustee, or (B) arises from the
Owner Trustee's breach of any of its representations or warranties set forth in
Section 7.3 of the Trust Agreement.
(d) Indemnification under this Article shall include, without
limitation, reasonable fees and expenses of counsel and expenses of litigation.
If the Servicer has made any indemnity payments pursuant to this Article and the
recipient thereafter collects any of such amounts from others, the recipient
shall promptly repay such amounts collected to the Servicer, together with any
interest earned thereon.
(e) TCC, in its individual capacity, hereby acknowledges that the
indemnification provisions in the Purchase Agreement benefiting the Issuer, the
Owner Trustee and the Indenture Trustee are enforceable by each hereunder.
(f) The provisions of this Section shall survive the resignation or
removal of the Owner Trustee and the termination of the Related Documents.
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SECTION 7.2. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, THE SERVICER. The Servicer shall not merge or consolidate with
any other Person, convey, transfer or lease substantially all its assets as an
entirety to another Person, or permit any other Person to become the successor
to the Servicer's business unless, after the merger, consolidation, conveyance,
transfer, lease or succession, the successor or surviving entity shall be an
Eligible Servicer and shall be capable of fulfilling the duties of the Servicer
contained in this Agreement. Any corporation (i) into which the Servicer may be
merged or consolidated, (ii) resulting from any merger or consolidation to which
the Servicer shall be a party, (iii) which acquires by conveyance, transfer, or
lease substantially all of the assets of the Servicer, or (iv) succeeding to the
business of the Servicer, in any of the foregoing cases shall execute an
agreement of assumption to perform every obligation of the Servicer under this
Agreement and, whether or not such assumption agreement is executed, shall be
the successor to the Servicer under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties to this
Agreement, anything in this Agreement to the contrary notwithstanding; PROVIDED,
HOWEVER, that nothing contained herein shall be deemed to release the Servicer
from any obligation. The Servicer shall provide notice of any merger,
consolidation or succession pursuant to this Section to the Owner Trustee, the
Indenture Trustee and each Rating Agency. Notwithstanding the foregoing, the
Servicer shall not merge or consolidate with any other Person or permit any
other Person to become a successor to the Servicer's business, unless
(a) immediately after giving effect to such transaction, no representation or
warranty made pursuant to Section 3.6 shall have been breached (for purposes
hereof, such representations and warranties shall speak as of the date of the
consummation of such transaction) and no event that, after notice or lapse of
time, or both, would become a Servicer Termination Event shall have occurred and
be continuing, (b) the Servicer shall have delivered to the Owner Trustee and
the Indenture Trustee a certificate of a Responsible Officer of the Servicer and
an Opinion of Counsel each stating that such consolidation, merger or succession
and such agreement of assumption comply with this Section and that all
conditions precedent, if any, provided for in this Agreement relating to such
transaction have been complied with, (c) the Servicer shall have delivered to
the Owner Trustee and the Indenture Trustee an Opinion of Counsel, stating that,
in the opinion of such counsel, either (1) all financing statements and
continuation statements and amendments thereto have been executed and filed that
are necessary to preserve and protect the interest of the Owner Trustee in the
Trust Assets and reciting the details of the filings or (2) no such action shall
be necessary to preserve and protect such interest, and (d) the Rating Agency
Condition has been satisfied.
SECTION 7.3. LIMITATION ON LIABILITY OF SERVICER AND OTHERS. Neither
the Servicer nor any of the directors or officers or employees or agents of the
Servicer shall be under any liability to the Issuer, the Equity
Certificateholders, the Depositor, the Noteholders, the Owner Trustee or the
Indenture Trustee except as provided in this Agreement, for any action taken or
for refraining from the taking of any action in good faith pursuant to this
Agreement; PROVIDED, HOWEVER, that this provision shall not
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protect the Servicer or any such person against any liability that would
otherwise be imposed by reason of a breach of this Agreement or willful
misfeasance, bad faith or gross negligence (excluding errors in judgment) in the
performance of duties, by reason of reckless disregard of obligations and duties
under this Agreement or any violation of law by the Servicer or such person, as
the case may be; PROVIDED FURTHER, that this provision shall not affect any
liability to indemnify the Owner Trustee and the Indenture Trustee for costs,
taxes, expenses, claims, liabilities, losses or damages paid by the Owner
Trustee or the Indenture Trustee, each in its individual capacity. The Servicer
and any director, officer, employee or agent of the Servicer may rely in good
faith on the advice of counsel or on any document of any kind PRIMA FACIE
properly executed and submitted by any Person respecting any matters arising
under this Agreement.
SECTION 7.4. SERVICER NOT TO RESIGN. Subject to the provisions of
Section 7.2, the Servicer shall not resign from the obligations and duties
imposed on it by this Agreement as Servicer except upon a determination that by
reason of a change in legal requirements the performance of its duties under
this Agreement would cause it to be in violation of such legal requirements in a
manner which would have a material adverse effect on the Servicer, and a Note
Majority (or, at such time as the Notes are no longer Outstanding, an Equity
Certificate Majority) does not elect to waive the obligations of the Servicer to
perform the duties which render it legally unable to act or to delegate those
duties to another Person. Any such determination permitting the resignation of
the Servicer shall be evidenced by an Opinion of Counsel to such effect
delivered to the Owner Trustee and the Indenture Trustee. No resignation of the
Servicer shall become effective until a successor Servicer that is an Eligible
Servicer shall have assumed the responsibilities and obligations of the
Servicer; PROVIDED, HOWEVER, that in the event a successor Servicer is not
appointed within 60 days after the Servicer has given notice of its resignation
and has provided the Opinion of Counsel required by this Section, the Servicer
may petition a court for its removal.
SECTION 7.5. CORPORATE EXISTENCE. The Servicer shall maintain its
existence, rights and franchises as a corporation under the laws of the
jurisdiction of its incorporation, and will obtain and preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which the failure to so qualify would have an adverse effect on the validity or
enforceability of any Contract or this Agreement or on the ability of the
Servicer to perform its duties under this Agreement.
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ARTICLE VIII
SERVICER TERMINATION EVENTS
SECTION 8.1. SERVICER TERMINATION EVENT. For purposes of this
Agreement, each of the following shall constitute a "Servicer Termination
Event":
(a) Any failure by the Servicer to deposit within the time
periods specified in this Agreement in the Collection Account for
distribution to Equity Certificateholders or Noteholders, or to distribute
to the Depositor, any proceeds or payment required to be so deposited or
distributed under the terms of this Agreement (or, if TCC is the Servicer,
the Purchase Agreement) that continues unremedied for a period of five
Business Days (three Business Days with respect to payment of Purchase
Amounts) after written notice is received by the Servicer from the
Indenture Trustee or after discovery of such failure by a Responsible
Officer of the Servicer; or
(b) Failure by the Servicer to deliver to the Indenture Trustee
and the Owner Trustee the Servicer's Certificate by the third Business Day
prior to the related Payment Date, or failure on the part of the Servicer
to observe its covenants and agreements set forth in Section 7.2; or
(c) Failure on the part of the Servicer duly to observe or
perform in any material respect any other covenants or agreements of the
Servicer set forth in this Agreement (or, if TCC is the Servicer, the
Purchase Agreement), which failure (i) materially and adversely affects the
rights of the Issuer, Equity Certificateholders or Noteholders, and
(ii) continues unremedied for a period of 30 days after the date on which
written notice of such failure, requiring the same to be remedied, shall
have been given to the Servicer by the Owner Trustee, the Indenture Trustee
or any Equity Certificateholder or Noteholder; or
(d) (i) The commencement of an involuntary case under the
federal bankruptcy laws, as now or hereinafter in effect, or another
present or future federal or state bankruptcy, insolvency or similar law
and such case is not dismissed within 60 days; or (ii) the entry of a
decree or order for relief by a court or regulatory authority having
jurisdiction in respect of the Servicer in an involuntary case under the
federal bankruptcy laws, as now or hereafter in effect, or another present
or future, federal or state, bankruptcy, insolvency or similar law, or
appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Servicer or of any
substantial part of their respective properties or ordering the winding up
or liquidation of the affairs of the Servicer; or
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<PAGE>
(e) The commencement by the Servicer of a voluntary case under
the federal bankruptcy laws, as now or hereafter in effect, or any other
present or future, federal or state, bankruptcy, insolvency or similar law,
or the consent by the Servicer to the appointment of or taking possession
by a receiver, liquidator, assignee, trustee, custodian, sequestrator or
other similar official of the Servicer or of any substantial part of its
property or the making by the Servicer of an assignment for the benefit of
creditors or the failure by the Servicer generally to pay its debts as such
debts become due or the taking of corporate action by the Servicer in
furtherance of any of the foregoing; or
(f) Any representation, warranty or statement of the Servicer
made in this Agreement or any certificate, report or other writing
delivered by the Servicer pursuant hereto shall prove to be incorrect in
any material respect as of the time when the same shall have been made, the
incorrectness of such representation, warranty or statement has a material
adverse effect on the Issuer, Equity Certificateholders or Noteholders,
and, within 30 days after written notice thereof shall have been given to
the Servicer or the Depositor by the Owner Trustee, the Indenture Trustee
or any Equity Certificateholder or Noteholder, the circumstances or
condition in respect of which such representation, warranty or statement
was incorrect shall not have been eliminated or otherwise cured.
SECTION 8.2. CONSEQUENCES OF A SERVICER TERMINATION EVENT. If a
Servicer Termination Event shall occur and be continuing, the Indenture Trustee
may, and at the direction of a Note Majority (or, at such time as the Notes are
no longer Outstanding, an Equity Certificate Majority) shall, by notice given in
writing to the Servicer and the Owner Trustee, terminate all of the rights and
obligations of the Servicer under this Agreement. On or after the receipt by
the Servicer of such written notice, all authority, power, obligations and
responsibilities of the Servicer under this Agreement, whether with respect to
the Equity Certificates, the Notes, the Trust Assets or otherwise, shall be
terminated and automatically shall pass to, be vested in and become obligations
and responsibilities of the Indenture Trustee (unless and until a successor
Servicer is appointed in accordance with Section 8.3); PROVIDED, HOWEVER, that
the Indenture Trustee shall have no liability with respect to any obligation
which was required to be performed by the terminated Servicer prior to the date
that the Indenture Trustee becomes the Servicer or any claim of a third party
based on any alleged action or inaction of the terminated Servicer. The
Indenture Trustee is authorized and empowered by this Agreement to execute and
deliver, on behalf of the terminated Servicer, as attorney-in-fact or otherwise,
any and all documents and other instruments and to do or accomplish all other
acts or things necessary or appropriate to effect the purposes of such notice of
termination. The terminated Servicer agrees to cooperate with the Indenture
Trustee in effecting the termination of the responsibilities and rights of the
terminated Servicer under this Agreement, including, without limitation, the
transfer to the Indenture Trustee for administration by it of all cash amounts
that shall at the time be held by the terminated Servicer for deposit, or have
been deposited by the terminated Servicer, in any of the Trust Accounts or
thereafter received with respect
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<PAGE>
to the Contracts and the delivery to the Indenture Trustee of all Contract
Files, Monthly Records and Collection Records and a computer tape in readable
form as of the most recent Business Day containing all information necessary to
enable the Indenture Trustee or a successor Servicer to service the Contracts
and the other Trust Assets. The terminated Servicer shall grant the Owner
Trustee, the Indenture Trustee and the successor Servicer reasonable access to
the terminated Servicer's premises at the terminated Servicer's expense.
SECTION 8.3. INDENTURE TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.
(a) On and after the time the Servicer receives a notice of
termination pursuant to Section 8.2, the Indenture Trustee shall be the
successor in all respects to the Servicer in its capacity as servicer under this
Agreement and the transactions set forth or provided for in this Agreement, and
shall be subject to all the responsibilities, restrictions, duties, liabilities
and termination provisions relating thereto placed on the Servicer by the terms
and provisions of this Agreement. As compensation therefor, the Indenture
Trustee shall be entitled to receive the Total Servicing Fee. The Owner Trustee
and the Indenture Trustee shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession.
(b) Notwithstanding the foregoing, the Indenture Trustee may, if it
shall be unwilling to so act, or shall, if it is legally unable to so act,
appoint, or petition a court of competent jurisdiction to appoint, any Eligible
Servicer as the successor to the Servicer hereunder in the performance of all or
any part of the responsibilities, duties or liabilities of the Servicer
hereunder. Pending appointment of a successor pursuant to the preceding
sentence, the Indenture Trustee shall act as successor Servicer unless it is
legally unable to do so, in which event the outgoing Servicer shall continue to
act as Servicer until a successor has been appointed and accepted such
appointment.
(c) In connection with such appointment and assumption, the
Indenture Trustee may make such arrangements for the compensation of such
successor out of payments on the Contracts as it and such successor shall agree;
PROVIDED, HOWEVER, that no such monthly compensation shall, without the written
consent of the Depositor and 100% of the Noteholders and the Equity
Certificateholders, exceed the Total Servicing Fee. The Indenture Trustee and
such successor shall take such action, consistent with this Agreement, as shall
be necessary to effectuate any such succession.
(d) If a successor Servicer is acting as Servicer hereunder, it
shall be subject to termination under Section 8.2 upon the occurrence of any
Servicer Termination Event applicable to it as Servicer.
(d) At such time as any successor Servicer (including the Indenture
Trustee) becomes Servicer hereunder, it shall agree to perform all of the
obligations of the Servicer under, and be subject to the terms of, the Cash
Collateral Account
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<PAGE>
Agreement, and shall take such actions as the parties to the Cash Collateral
Account Agreement may reasonably request to evidence such agreement.
SECTION 8.4. NOTIFICATION TO EQUITY CERTIFICATEHOLDERS AND
NOTEHOLDERS. Upon any termination of, or appointment of a successor to, the
Servicer pursuant to this Article VIII, the Owner Trustee shall give prompt
written notice thereof to Equity Certificateholders at their respective
addresses appearing in the Certificate Register and to each Rating Agency, and
the Indenture Trustee shall give prompt written notice thereof to Noteholders at
their respective addresses appearing in the Note Register.
SECTION 8.5. WAIVER OF PAST DEFAULTS. A Note Majority (or, at such
time as the Notes are no longer Outstanding, an Equity Certificate Majority) may
waive any default by the Servicer in the performance of its obligations
hereunder and its consequences. Upon any such waiver of a past default, such
default shall cease to exist, and any Servicer Termination Event arising
therefrom shall be deemed to have been remedied for every purpose of this
Agreement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
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<PAGE>
ARTICLE IX
MISCELLANEOUS PROVISIONS
SECTION 9.1. AMENDMENT.
(a) This Agreement may be amended by the Depositor, the Servicer, the
Issuer and the Indenture Trustee without the consent of any of the Noteholders
or Equity Certificateholders, (i) to cure any ambiguity, (ii) to correct or
supplement any provisions in this Agreement that may be inconsistent with any
other provision herein, or (iii) to make any other provisions with respect to
matters or questions arising under this Agreement that are not inconsistent with
the provisions hereof; PROVIDED, HOWEVER, that such action shall not, as
evidenced by an Opinion of Counsel, adversely affect in any material respect the
interests of the Noteholders or Equity Certificateholders.
(b) This Agreement may also be amended from time to time by the
Depositor, the Servicer, the Issuer and the Indenture Trustee with the consent
of an Equity Certificate Majority and a Note Majority (which consent of any
Holder of an Equity Certificate or Note given pursuant to this Section or
pursuant to any other provision of this Agreement shall be conclusive and
binding on such Holder and on all future Holders of such Equity Certificate or
Note and of any Equity Certificate or Note issued upon the transfer thereof or
in exchange thereof or in lieu thereof whether or not notation of such consent
is made upon the Equity Certificate or Note) for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement, or of modifying in any manner the rights of the Holders of
Equity Certificates or Notes; PROVIDED, HOWEVER, that no such amendment shall
(a) increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Contracts or distributions required to be
made on any Equity Certificate or Note or the rate of interest payable thereon,
(b) amend any provisions of Section 5.06 or 8.03 of the Indenture in such a
manner as to affect the priority of payment of interest or principal to
Noteholders or Equity Certificateholders, or (c) reduce the aforesaid percentage
required to consent to any such amendment or any waiver hereunder, without the
consent of the Holders of all Equity Certificates or Notes then Outstanding and
affected thereby; and PROVIDED, FURTHER, that no such amendment shall be
effective unless and until the Rating Agency Condition has been satisfied.
(c) Promptly after the execution of any such amendment or consent,
the Owner Trustee or the Indenture Trustee, as appropriate, shall furnish
written notification of the substance of such amendment or consent to each
Equity Certificateholder and Noteholder.
(d) It shall not be necessary for the consent of Equity
Certificateholders or Noteholders pursuant to Section 9.1(b) to approve the
particular form of any proposed amendment or consent, but it shall be sufficient
if such consent shall approve
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<PAGE>
the substance thereof. The manner of obtaining such consents (and any other
consents of Equity Certificateholders and Noteholders provided for in this
Agreement) and of evidencing the authorization of the execution thereof by
Equity Certificateholders or Noteholders shall be subject to such reasonable
requirements as the Owner Trustee or Indenture Trustee, as applicable, may
prescribe, including the establishment of record dates.
(e) Prior to the execution of any amendment to this Agreement, the
Owner Trustee shall be entitled to receive and rely upon an Opinion of Counsel
stating that the execution of such amendment is authorized or permitted by this
Agreement, in addition to the Opinion of Counsel referred to in Section 9.2(h).
The Owner Trustee may, but shall not be obligated to, enter into any such
amendment which affects the Owner Trustee's own rights, duties or immunities
under this Agreement or otherwise.
SECTION 9.2. PROTECTION OF TITLE TO TRUST ASSETS.
(a) The Depositor shall execute and file such financing statements
and cause to be executed and filed such continuation and other statements
(including those prepared by the Servicer pursuant to Section 3.14(c)), all in
such manner and in such places as may be required by law fully to preserve,
maintain and protect the interest of the Issuer, the Owner Trustee and the
Indenture Trustee in the Trust Assets and in the proceeds thereof; except that
(i) UCC-1 financing statements and continuation statements, listing the Obligor
as debtor and the related Equipment as collateral, need be filed only as
required by Section 3.5; and (ii) no assignments of any such financing
statements relating to the Equipment shall be filed to reflect the assignment of
the Contracts by the Originators to the Depositor and by the Depositor to the
Issuer. The Depositor shall deliver (or cause to be delivered) to the Owner
Trustee and the Indenture Trustee file-stamped copies of, or filing receipts
for, any document filed as provided above, as soon as available following such
filing.
(b) Neither the Depositor nor the Issuer shall change its name,
identity or corporate structure in any manner that would, could or might make
any financing statement or continuation statement filed by the Depositor in
accordance with paragraph (a) above seriously misleading within the meaning of
Section 9-402(7) of the UCC, unless it shall have given the Owner Trustee and
the Indenture Trustee at least 60 days' prior written notice thereof, and shall
promptly file appropriate amendments to all previously filed financing
statements and continuation statements.
(c) Each of the Depositor, the Servicer and the Issuer shall give the
Owner Trustee and the Indenture Trustee at least 60 days' prior written notice
of any relocation of its principal executive office if, as a result of such
relocation, the applicable provisions of the UCC would require the filing of any
amendment of any previously filed financing or continuation statement or of any
new financing statement. The Servicer shall at all times maintain each office
from which it services Contracts and its principal executive office within the
United States of America.
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<PAGE>
(d) The Servicer shall maintain accounts and records as to each
Contract accurately and in sufficient detail to permit (i) the reader thereof to
know at any time the status of such Contract, including payments and recoveries
made and payments owing (and the nature of each) and (ii) reconciliation between
payments or recoveries on (or with respect to) each Contract and the amounts
from time to time deposited in the Collection Account in respect of such
Contract.
(e) The Servicer shall maintain its computer systems so that, from
and after the time of transfer and assignment under this Agreement of the
Contracts to the Issuer, the Servicer's master computer records (including any
backup archives) that refer to any Contract indicate clearly that the Contract
is owned by the Issuer. Indication of the Issuer's ownership of a Contract
shall be deleted from or modified on the Servicer's computer systems when, and
only when, the Contract has been paid in full, liquidated (including receipt of
all recoveries reasonably expected to be collected) or purchased by the
Depositor or TCC.
(f) Upon receipt by the Servicer of reasonable prior notice, Servicer
shall permit the Owner Trustee, the Indenture Trustee and their respective
agents, at any time during the Servicer's normal business hours to inspect,
audit and make copies of and abstracts from the Servicer's records regarding any
Contracts or any other portion of the Trust Assets.
(g) The Servicer shall furnish to the Owner Trustee and the Indenture
Trustee at any time upon request a list (which may, at the option of the
Servicer, be on a computer disk or other electronic storage medium) of all
Contracts then held as part of the Trust Assets, together with a reconciliation
of such list to the Schedule of Contracts and to each of the Servicer's
Certificates furnished before such request indicating removal of Contracts from
the Issuer. Upon request, the Servicer shall furnish a copy of any list to the
Depositor. Subject to the following sentence, the Owner Trustee shall hold any
such list and Schedule of Contracts for examination by interested parties during
normal business hours at the Corporate Trust Office upon reasonable notice by
such Persons of their desire to conduct an examination. The Owner Trustee shall
and shall cause its representatives to hold in confidence all information
thereon relating to the identity of the Obligors except to the extent disclosure
may be required by Section 9-208 of the UCC or by other applicable law (and all
reasonable applications for confidential treatment are unavailing) and except to
the extent that the Owner Trustee may reasonably determine that such disclosure
is consistent with its obligations under the Indenture.
(h) The Depositor and the Servicer shall deliver to the Owner Trustee
and the Indenture Trustee simultaneously with the execution and delivery of this
Agreement and of each amendment thereto and upon the occurrence of the events
giving rise to an obligation to give notice pursuant to Section 9.2(b) or (c),
an Opinion of Counsel either (a) stating that, in the opinion of such Counsel,
all financing statements and continuation statements have been executed and
filed that are necessary fully to
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<PAGE>
preserve and protect the interest of the Issuer and the Indenture Trustee in the
Contracts and the other Trust Assets, and reciting the details of such filings
or referring to prior Opinions of Counsel in which such details are given, or
(b) stating that, in the opinion of such counsel, no such action is necessary to
preserve and protect such interest.
(i) The Servicer shall deliver to the Owner Trustee and the Indenture
Trustee, within 90 days after the beginning of each calendar year beginning with
the first calendar year beginning more than three months after the Closing Date,
an Opinion of Counsel, either (a) stating that, in the opinion of such counsel,
all financing statements and continuation statements have been executed and
filed that are necessary fully to preserve and protect the interest of the
Issuer and the Indenture Trustee in the Contracts, and reciting the details of
such filings or referring to prior Opinions of Counsel in which such details are
given, or (b) stating that, in the opinion of such counsel, no action shall be
necessary to preserve and protect such interest.
SECTION 9.3. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.
SECTION 9.4. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Equity
Certificates or the Notes or the respective rights of the Holders thereof.
SECTION 9.5. ASSIGNMENT. Notwithstanding anything to the contrary
contained in this Agreement, except as provided in Section 7.2 or Section 8.2
(and as provided in the provisions of the Agreement concerning the resignation
of the Servicer), this Agreement may not be assigned by the Depositor or the
Servicer without (i) the prior written consent of the Owner Trustee, the
Indenture Trustee, a Note Majority and an Equity Certificate Majority, and (ii)
satisfaction of the Rating Agency Condition.
SECTION 9.6. THIRD-PARTY BENEFICIARIES. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. Nothing in this Agreement, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder, any benefit or any legal or equitable right, remedy or
claim under this Agreement.
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<PAGE>
SECTION 9.7. COUNTERPARTS. For the purpose of facilitating its
execution and for other purposes, this Agreement may be executed simultaneously
in any number of counterparts, each of which counterparts shall be deemed to be
an original, and all of which counterparts shall constitute but one and the same
instrument.
SECTION 9.8. INTENTION OF PARTIES. The parties hereto intend that,
in the event that the conveyance of the Contracts and other Trust Assets
pursuant to this Agreement is determined to be made as security for a loan made
by the Issuer, the Equity Certificateholders or the Noteholders to the
Depositor, the Depositor hereby grants to the Issuer to secure such loan a first
priority security interest in all of the Depositor's right, title and interest
in and to the rights and property intended to be conveyed to the Issuer pursuant
to Section 2.1(a). This Agreement shall, in such event, constitute a security
agreement under applicable law.
SECTION 9.9. NOTICES. All demands, notices and communications under
this Agreement shall be in writing, personally delivered or mailed by certified
mail-return receipt requested, or by facsimile transmission, and shall be deemed
to have been duly given upon receipt (a) in the case of TCC, the Depositor or
the Servicer, at the following address: 44 Whippany Road, Morristown, New
Jersey 07962, Attention: General Counsel, (b) in the case of the Owner Trustee,
at its Corporate Trust Office, and (c) in the case of the Indenture Trustee, at
its Corporate Trust Office, or at such other address as shall be designated by
any such party in a written notice to the other parties.
SECTION 9.10. INCOME TAX CHARACTERIZATION. The Depositor has
structured the Trust Agreement, the Indenture, the Cash Collateral Account
Agreement, the Notes and the Equity Certificates with the intention that the
Notes will qualify under applicable federal, state, local and foreign tax law as
indebtedness of the Depositor secured by the Contracts. The Depositor and the
Servicer agree to treat and to take no action inconsistent with the treatment of
the Notes as such indebtedness for purposes of federal, state, local and foreign
income or franchise taxes and any other tax imposed on or measured by income.
SECTION 9.11. LIMITATION OF LIABILITY. It is expressly understood and
agreed by the parties hereto that (a) this Agreement is executed and delivered
by The Bank of New York, not individually or personally but solely as Owner
Trustee of the Issuer under the Trust Agreement, in the exercise of the powers
and authority conferred and vested in it, (b) each of the representations,
undertakings and agreements herein made on the part of the Issuer is made and
intended not as personal representations, undertakings and agreements by The
Bank of New York but is made and intended for the purpose for binding only the
Issuer, (c) nothing herein contained shall be construed as creating any
liability on The Bank of New York, individually or personally, to perform any
covenant either expressed or implied contained herein, all such liability, if
any, being expressly waived by the parties to this Agreement and by any person
claiming by, through or under them and (d) under no circumstances shall The Bank
of New York be personally liable for the payment of any indebtedness or expenses
of the
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<PAGE>
Issuer or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Issuer under this Agreement or
any related documents.
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<PAGE>
IN WITNESS WHEREOF, the Issuer, the Depositor, TCC, the Servicer and
the Indenture Trustee have caused this Transfer and Servicing Agreement to be
duly executed by their respective officers as of the day and year first above
written.
ISSUER:
CAPITA EQUIPMENT RECEIVABLES
TRUST 1996-1
By THE BANK OF NEW YORK,
not in its individual capacity but
solely as Owner Trustee
By /s/ Cheryl L. Laser
----------------------------------------
Name: Cheryl L. Laser
Title: Assistant Vice President
DEPOSITOR:
ANTIGUA FUNDING CORPORATION
By /s/ James Elton
----------------------------------------
Name: James Elton
Title: Vice President
AT&T CAPITAL CORPORATION
In its individual capacity and as Servicer
By /s/ Ramon Oliu, Jr.
----------------------------------------
Name: Ramon Oliu, Jr.
Title: Vice President and Controller
INDENTURE TRUSTEE:
THE CHASE MANHATTAN BANK
not in its individual capacity but
solely as Indenture Trustee
By /s/ Charles E. Dooley
----------------------------------------
Name: Charles E. Dooley
Title: Vice President
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<PAGE>
EXHIBIT A-1
SCHEDULE OF LEASE CONTRACTS AND LEASED EQUIPMENT
A-1-1
INTENTIONALLY
OMITTED
<PAGE>
EXHIBIT A-2
SCHEDULE OF LOAN CONTRACTS
A-1-1
INTENTIONALLY
OMITTED
<PAGE>
EXHIBIT B
FORM OF SERVICER'S CERTIFICATE
The undersigned, on behalf of AT&T Capital Corporation, in its
capacity as servicer (the "Servicer") under the Transfer and Servicing
Agreement, dated as of October 1, 1996 (the "Transfer and Servicing Agreement"),
among Capita Equipment Receivables Trust 1996-1, Antigua Funding Corporation,
The Chase Manhattan Bank, as trustee under the Indenture, and AT&T Capital
Corporation, in its individual capacity and as Servicer, DO HEREBY CERTIFY that
he/she is a Responsible Officer of the Servicer and, pursuant to Section 3.9 of
the Transfer and Servicing Agreement, DO HEREBY FURTHER CERTIFY the following
with respect to the Payment Date occurring on :
-----------------
B-1
<PAGE>
This Certificate shall constitute the Servicer's Certificate required
by Section 3.9 of the Transfer and Servicing Agreement with respect to the above
Payment Date. Any term capitalized but not defined herein shall have the
meaning ascribed thereto in the Transfer and Servicing Agreement.
IN WITNESS WHEREOF the undersigned has hereunto set his/her hand this
day of , .
- --------------- ---------------------------- ------------
AT&T CAPITAL CORPORATION
By
Name:
Title:
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE:
PAYMENT DATE:
COLLECTION PERIOD:
I. INFORMATION REGARDING THE CONTRACTS
1. CONTRACT POOL PRINCIPAL BALANCE
a. Beginning of Collection Period(1) $
b. End of Collection Period $
c. Reduction for Collected Period $
2. DELINQUENT SCHEDULED PAYMENTS
a. Beginning of Collection Period $
b. End of Collection Period $
3. LIQUIDATED CONTRACTS
a. Number of Liquidated Contracts with respect to
Collection Period _______
b. Required Payoff Amounts of Liquidated Contracts $
c. Total Reserve for Liquidation Expenses
d. Total Liquidation Proceeds Received(2) $
e. Liquidation Proceeds Allocated to Owner Trust $
f. Liquidation Proceeds Allocated to Depositor $
g. Current Realized Losses $
4. PREPAID CONTRACTS
a. Number of Prepaid Contracts with respect to
Collection Period _______
b. Required Payoff Amounts of Prepaid Contracts $
5. PURCHASED CONTRACTS (BY TCC)
a. Number of Contracts Purchased by TCC with respect
to Collection Period _______
b. Required Payoff Amounts of Purchased Contracts $
__________
(1) For Initial Collection Period, equal to $3,185,229,329.
(2) Net of any addition to reserve for liquidation expenses.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
6. DELINQUENCY STATUS OF CONTRACTS (END OF COLLECTION PERIOD)(3)
----------------------------------------------------------------
% of Aggregate
Number of % of Aggregate Required Required Payoff
Contracts Contracts Payoff Amounts Amounts
----------------------------------------------------------------
a. Current
b. 31-60 days
c. 61-90 days
d. 91-120 days
e. 120+ days
f. Total
___________
(3) Show delinquency of Contracts as of the end of the current Collection
Period.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
7. HISTORICAL LOSS EXPERIENCE WITH RESPECT TO CONTRACTS
<TABLE>
<CAPTION>
-------------------------------------------------------------
3 Collection 6 Collection
[Month/Year] Periods Periods Cumulative
Collection Ending Ending Since
Period [Month/Year] [Month/Year] Cut-off Date
-------------------------------------------------------------
<S> <S> <S> <S> <S>
a. Number of Liquidated
Contacts
b. Number of Liquidated
Contracts as a Percentage
of Initial Contracts
c. Required Payoff Amounts
of Liquidated Contracts
d. Liquidation Proceeds
Allocated to Owner Trust
e. Aggregate Current
Realized Losses
f. Aggregate Current Realized
Losses as a Percentage of
Cut-off Date Contract Pool
Principal Balance
</TABLE>
__________
(4) Show loss experience of Contracts for the current Collection Period and
historic experience for most recent 3 and 6 month periods and cumulative
experience for the Trust.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
8. HISTORICAL DELINQUENCY EXPERIENCE WITH RESPECT TO CONTRACTS(5)
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
Required
Required Required Pay of Required
Payoff Payoff Amounts of Payoff
Amounts of % of Aggregate Amounts of % of Aggregate Contracts % of Aggregate Amounts of % of Aggregate
Contracts Required Contracts Required 91-120 Required Contracts Required
Collection 31-60 Days Payoff 61-90 Days Payoff Days Payoff 120+ Days Payoff
Periods Past Due Amounts Past Due Amounts Past Due Amounts Past Due Amounts
<S> <C> <C> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
__________
(5) Show delinquency experience for current and all prior Collection Periods.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
II. INFORMATION REGARDING THE SECURITIES
1. SUMMARY OF BALANCE INFORMATION(6)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Principal Class Factor Principal Class Factor
Balance as of as of Balance as of as of
Coupon [Month/Year] [Month/Year] [Month/Year] [Month/Year]
Class Rate Payment Date Payment Date Payment Date Payment Date
<S> <C> <C> <C> <C> <C>
----------------------------------------------------------------------------------------------------------------
</TABLE>
a. Class A-1 Notes 5.60%
b. Class A-2 Notes 5.95%
c. Class A-3 Notes 6.11%
d. Class A-4 Notes 6.28%
e. Class B Notes 6.57%
f. Equity Certificates 6.75%
g. Total N.A.
___________
(6) Show information for current and immediately preceding Payment Date.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
2. MONTHLY PRINCIPAL AMOUNT
a. Principal Balance of Notes and Equity Certificates
(End of Collection Period) $
b. Contract Pool Principal Balance (End of Collection
Period) $
c. Monthly Principal Amount $
3. GROSS COLLECTIONS
a. Scheduled Payments Received $
b. Liquidation Proceeds Allocated to Owner Trust $
c. Required Payoff Amounts of Prepaid Contracts $
d. Required Payoff Amounts of Purchased Contracts $
e. Proceeds of Clean-up Call $
f. Investment Earnings on Collection Account and Note
Distribution Account $
g. Extension Fees Allocated to Owner Trust $
h. Total Gross Collections (sum (a) through (g)) $
4. DETERMINATION OF AVAILABLE FUNDS
a. Total Gross Collections $
b. Withdrawal from Cash Collateral Account $
c. Total Available Funds (sum of (a) and (b)) $
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
5. APPLICATION OF AVAILABLE FUNDS
----------------------------------------------------------
Item Amount Remaining Available Funds
----------------------------------------------------------
a. Total Available Funds
b. Servicing Fee
c. Interest on Notes:
i) Class A-1 Notes
ii) Class A-2 Notes
iii) Class A-3 Notes
iv) Class A-4 Notes
v) Class B Notes
d. Interest on Equity
Certificates
e. Principal of Notes and
Equity Certificates:
i) Class A-1 Notes
ii) Class A-2 Notes
iii) Class A-3 Notes
iv) Class A-4 Notes
v) Class B Notes
vi) Equity Certificates
f. Deposit to Cash
Collateral Account
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
----------------------------------------------------------
Item Amount Remaining Available Funds
----------------------------------------------------------
g. Amount to be applied
in accordance with
CCA Loan Agreement
h. Balance, if any, to
Equity Certificates
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
III. INFORMATION REGARDING THE CASH COLLATERAL ACCOUNT
1. BALANCE RECONCILIATION(7)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
[Month/Year] [Month/Year]
Item Payment Date Payment Date
---------------------------------------------------------------------------------------------------
<S> <C> <C>
a. Available Cash Collateral Amount (Beginning) $ $
b. Deposits to Cash Collateral Account $ $
c. Withdrawals from Cash Collateral Account $ $
d. Releases of Cash Collateral Account Surplus $ $
e. Available Cash Collateral Amount (End) $ $
f. Requisite Cash Collateral Amount $ $
g. Cash Collateral Account Shortfall $ $
2. CALCULATION OF REQUISITE CASH COLLATERAL AMOUNT
a. For Payment Dates from, and including, the
November 1996 Payment Date to, and including,
the October 1997 Payment Date
1) Initial Cash Collateral Amount $207,040,000
b. For Payment Dates from, and including, the November 1997
Payment Date until the Final Payment Date, the sum of
1) 8% of the Contract Pool Principal Balance
2) The Aggregate Principal Balance of the Notes and the
Equity Certificate Balance less the Contract Pool
Principal Balance $
3) Tool $
</TABLE>
__________
(7) Show for current and immediately preceding Payment Date.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
c. Floor equal to the lesser of
1) 2% of Cut-Off Date Contract Pool Principal
Balance ($63,704,600); and
2) the Aggregate Principal Balance of the Notes
and the Equity Certificate Balance $
d. Requisite Cash Collateral Amount $
3. CALCULATION OF CASH COLLATERAL ACCOUNT WITHDRAWALS
a. Interest Shortfalls $
b. Principal Deficiency Amount $
c. Principal Payable at Stated Maturity Date of Class
of Notes or Equity Certificates $
d. Total Cash Collateral Account Withdrawals $
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
IV. INFORMATION REGARDING DISTRIBUTIONS ON SECURITIES
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------
Distribution Class A-1 Class A-2 Class A-3 Class A-4 Class B Equity
Amounts Notes Notes Notes Notes Notes Certificates
<S> <C> <C> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------------
</TABLE>
1. INTEREST DUE
2. INTEREST PAID
3. INTEREST SHORTFALL
4. PRINCIPAL PAID
5. TOTAL DISTRIBUTION AMOUNT
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
V. INFORMATION REGARDING OTHER POOL CHARACTERISTICS (8)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
As of End of [Month/Year] As of End of [Month/Year]
Item Collection Period Collection Period
--------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. ORIGINAL CONTRACT CHARACTERISTICS
a. Original Number of Contracts 280,634 N.A.
b. Cut-Off Date Contract Pool $3,185,229,329 N.A.
Principal Balance
c. Original Weighted Average 38.6 months N.A.
Remaining Term
d. Weighted Average Original Term 56.1 months N.A.
2. CURRENT CONTRACT CHARACTERISTICS
a. Number of Contracts
b. Average Contract
Principal Balance
c. Weighted Average Remaining
Term
</TABLE>
__________
(8) For Current Contract Characteristics, show for current and immediately
preceding Collection Periods. Original Contract Characteristics do not
change.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
VI. PURCHASED, LIQUIDATED AND PAID CONTRACTS
1. The following list includes the account number for each Contract
which, during the Collection Period to which this report relates, was
(i) purchased by TCC, (ii) designated as a Liquidated Contract or
(iii) paid in full (either due to a prepayment or at maturity):
[Insert list]
<PAGE>
Exhibit 4.2
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
5.60% RECEIVABLE-BACKED NOTES, CLASS A-1
5.95% RECEIVABLE-BACKED NOTES, CLASS A-2
6.11% RECEIVABLE-BACKED NOTES, CLASS A-3
6.28% RECEIVABLE-BACKED NOTES, CLASS A-4
6.57% RECEIVABLE-BACKED NOTES, CLASS B
INDENTURE
DATED AS OF OCTOBER 1, 1996
THE CHASE MANHATTAN BANK
TRUSTEE
<PAGE>
CROSS REFERENCE TABLE
TIA Indenture
Section Section
- ------- ---------
310(a)(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.10
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.(2)
(a)(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.08;6.11
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.12
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.12
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.01
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.02
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.02
313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.04
(b)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.04
(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.04
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.05
(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.04
314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.03
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.06;11.15
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01
(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01
(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01
(f). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.01
315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.01
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.05;11.05
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.01
(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.01
(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.14
316(a)(last sentence). . . . . . . . . . . . . . . . . . . . . . . 1.01
(a)(1)(A). . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.12
(a)(1)(B). . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.13
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.08
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
317(a)(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.03
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.03
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.03
318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.07
- ------------------------
<PAGE>
1 Note: This Cross Reference Table shall not, for any purpose, be deemed
to be part of this Indenture.
2 N.A. means Not Applicable.
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I Definitions and Incorporation by Reference . . . . . . 3
SECTION 1.01. Definitions. . . . . . . . . . . . . . . . . . . . 3
SECTION 1.02. Incorporation by Reference of Trust Indenture Act. 24
SECTION 1.03. Rules of Construction. . . . . . . . . . . . . . . 25
ARTICLE II The Notes. . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.01. Form . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.02. Execution, Authentication and Delivery . . . . . . 26
SECTION 2.03. Temporary Notes. . . . . . . . . . . . . . . . . . 27
SECTION 2.04. Registration; Registration of Transfer and Exchange 27
SECTION 2.05. Mutilated, Destroyed, Lost or Stolen Notes . . . . 29
SECTION 2.06. Person Deemed Owner. . . . . . . . . . . . . . . . 29
SECTION 2.07. Payment of Principal and Interest; Defaulted Interest 30
SECTION 2.08. Cancellation . . . . . . . . . . . . . . . . . . . 30
SECTION 2.09. Book-Entry Notes . . . . . . . . . . . . . . . . . 31
SECTION 2.10. Notices to Depository. . . . . . . . . . . . . . . 32
SECTION 2.11. Definitive Notes . . . . . . . . . . . . . . . . . 32
SECTION 2.12. Calculations . . . . . . . . . . . . . . . . . . . 32
SECTION 2.13. Deposit of Series 1996-1 Note Proceeds . . . . . . 32
ARTICLE III Covenants. . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 3.01. Payment of Principal and Interest. . . . . . . . . 34
SECTION 3.02. Maintenance of Office or Agency. . . . . . . . . . 34
SECTION 3.03. Money for Payments To Be Held in Trust . . . . . . 34
SECTION 3.04. Existence. . . . . . . . . . . . . . . . . . . . . 36
SECTION 3.05. Protection of Trust Estate . . . . . . . . . . . . 36
SECTION 3.06. Opinions as to Trust Estate. . . . . . . . . . . . 37
SECTION 3.07. Performance of Obligations; Servicing of Contracts 37
SECTION 3.08. Negative Covenants . . . . . . . . . . . . . . . . 39
SECTION 3.09. Annual Statement as to Compliance. . . . . . . . . 39
SECTION 3.10. Issuer May Consolidate or Merge Only on Certain
Terms. . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 3.11. Successor or Transferee . . . . . . . . . . . . . 42
SECTION 3.12. No Other Business. . . . . . . . . . . . . . . . . 42
SECTION 3.13. No Borrowing . . . . . . . . . . . . . . . . . . . 42
SECTION 3.14. Servicer's Obligations . . . . . . . . . . . . . . 43
SECTION 3.15. Guarantees, Loans, Advances and Other Liabilities. 43
SECTION 3.16. Income Tax Characterization. . . . . . . . . . . . 43
SECTION 3.17. Restricted Payments. . . . . . . . . . . . . . . . 43
SECTION 3.18. Notice of Events of Default. . . . . . . . . . . . 43
SECTION 3.19. Further Instruments and Acts . . . . . . . . . . . 44
-i-
<PAGE>
SECTION 3.20. Compliance with Laws . . . . . . . . . . . . . . . 44
SECTION 3.21. Amendments of Transfer and Servicing Agreement
and Trust Agreement. . . . . . . . . . . . . . . . 44
SECTION 3.22. Trust Obligation . . . . . . . . . . . . . . . . . 44
SECTION 3.23. Appointment of Luxembourg Paying Agent and
Luxembourg Listing Agent.. . . . . . . . . . . . . 44
ARTICLE IV Satisfaction and Discharge . . . . . . . . . . . . . . 46
SECTION 4.01. Satisfaction and Discharge of Indenture. . . . . . 46
SECTION 4.02. Application of Trust Money . . . . . . . . . . . . 47
SECTION 4.03. Repayment of Moneys Held by Paying Agent . . . . . 47
SECTION 4.04. Release of Trust Estate. . . . . . . . . . . . . . 47
ARTICLE V Remedies . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 5.01. Events of Default. . . . . . . . . . . . . . . . . 49
SECTION 5.02. Rights upon Event of Default . . . . . . . . . . . 50
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement
by Trustee; Authority of Trustee . . . . . . . . . 50
SECTION 5.04. Remedies . . . . . . . . . . . . . . . . . . . . . 52
SECTION 5.05. Optional Preservation of the Contracts . . . . . . 53
SECTION 5.06. Priorities . . . . . . . . . . . . . . . . . . . . 53
SECTION 5.07. Limitation of Suits. . . . . . . . . . . . . . . . 54
SECTION 5.08. Unconditional Rights of Noteholders To Receive
Principal and Interest . . . . . . . . . . . . . . 55
SECTION 5.09. Restoration of Rights and Remedies . . . . . . . . 55
SECTION 5.10. Rights and Remedies Cumulative . . . . . . . . . . 55
SECTION 5.11. Delay or Omission Not a Waiver . . . . . . . . . . 56
SECTION 5.12. Control by Noteholders . . . . . . . . . . . . . . 56
SECTION 5.13. Waiver of Past Defaults. . . . . . . . . . . . . . 56
SECTION 5.14. Undertaking for Costs. . . . . . . . . . . . . . . 57
SECTION 5.15. Waiver of Stay or Extension Laws . . . . . . . . . 57
SECTION 5.16. Action on Notes. . . . . . . . . . . . . . . . . . 57
SECTION 5.17. Performance and Enforcement of Certain Obligations 57
ARTICLE VI The Trustee. . . . . . . . . . . . . . . . . . . . . . 59
SECTION 6.01. Duties of Trustee. . . . . . . . . . . . . . . . . 59
SECTION 6.02. Rights of Trustee. . . . . . . . . . . . . . . . . 61
SECTION 6.03. Individual Rights of Trustee . . . . . . . . . . . 62
SECTION 6.04. Trustee's Disclaimer . . . . . . . . . . . . . . . 63
SECTION 6.05. Notice of Defaults . . . . . . . . . . . . . . . . 63
SECTION 6.06. Reports by Trustee to Holders. . . . . . . . . . . 63
SECTION 6.07. Compensation and Indemnity . . . . . . . . . . . . 63
SECTION 6.08. Replacement of Trustee . . . . . . . . . . . . . . 64
SECTION 6.09. Successor Trustee by Merger. . . . . . . . . . . . 65
SECTION 6.10. Appointment of Co-Trustee or Separate Trustee. . . 66
-ii-
<PAGE>
SECTION 6.11. Eligibility; Disqualification. . . . . . . . . . . 67
SECTION 6.12. Preferential Collection of Claims Against Issuer . 67
SECTION 6.13. Representations and Warranties of the Trustee. . . 67
SECTION 6.14. Servicer's Obligations . . . . . . . . . . . . . . 68
ARTICLE VII Noteholders' Lists and Reports . . . . . . . . . . . . 69
SECTION 7.01. Note Registrar To Furnish Trustee Names and
Addresses to Noteholders . . . . . . . . . . . . . 69
SECTION 7.02. Preservation of Information; Communications to
Noteholders. . . . . . . . . . . . . . . . . . . . 69
SECTION 7.03. Reports by Issuer. . . . . . . . . . . . . . . . . 69
SECTION 7.04. Reports by Trustee . . . . . . . . . . . . . . . . 70
SECTION 7.05. Statements to Noteholders and Equity
Certificateholders . . . . . . . . . . . . . . . . 70
SECTION 7.06. Availability of Reports, Statements and Other
Information to Note Owners in Luxembourg . . . . . 71
ARTICLE VIII Trust Accounts, Disbursements and Releases . . . . . . 72
SECTION 8.01. Collection of Money. . . . . . . . . . . . . . . . 72
SECTION 8.02. Collection Account . . . . . . . . . . . . . . . . 72
SECTION 8.03. Distributions. . . . . . . . . . . . . . . . . . . 72
SECTION 8.04. Note Distribution Account. . . . . . . . . . . . . 73
SECTION 8.05. Servicing Account. . . . . . . . . . . . . . . . . 74
SECTION 8.06. Cash Collateral Account. . . . . . . . . . . . . . 74
SECTION 8.07. General Provisions Regarding Servicing Account,
Collection Account, Note Distribution Account and
Cash Collateral Account. . . . . . . . . . . . . . 76
ARTICLE IX Supplemental Indentures. . . . . . . . . . . . . . . . 79
SECTION 9.01. Supplemental Indentures Without Consent of
Noteholders or Equity Certificateholders . . . . . 79
SECTION 9.02. Supplemental Indentures With Consent of
Noteholders and Equity Certificateholders. . . . . 80
SECTION 9.03. Execution of Supplemental Indentures . . . . . . . 82
SECTION 9.04. Effect of Supplemental Indenture . . . . . . . . . 82
SECTION 9.05. Conformity With Trust Indenture Act. . . . . . . . 83
SECTION 9.06. Reference in Notes to Supplemental Indentures. . . 83
ARTICLE X Redemption of Notes. . . . . . . . . . . . . . . . . . 84
SECTION 10.01. Redemption . . . . . . . . . . . . . . . . . . . . 84
SECTION 10.02. Form of Redemption Notice. . . . . . . . . . . . . 84
SECTION 10.03. Notes Payable on Redemption Date . . . . . . . . . 85
ARTICLE XI Miscellaneous. . . . . . . . . . . . . . . . . . . . . 86
SECTION 11.01. Compliance Certificates and Opinions, etc. . . . . 86
SECTION 11.02. Form of Documents Delivered to Trustee . . . . . . 88
-iii-
<PAGE>
SECTION 11.03. Acts of Noteholders. . . . . . . . . . . . . . . . 89
SECTION 11.04. Notices, etc., to Trustee, Issuer, Luxembourg Listing
Agent and Rating Agencies. . . . . . . . . . . . . 89
SECTION 11.05. Notices to Noteholders; Waiver . . . . . . . . . . 90
SECTION 11.06. Alternate Payment and Notice Provisions. . . . . . 91
SECTION 11.07. Conflict with Trust Indenture Act. . . . . . . . . 91
SECTION 11.08. Effect of Headings and Table of Contents . . . . . 91
SECTION 11.09. Successors and Assigns . . . . . . . . . . . . . . 91
SECTION 11.10. Severability . . . . . . . . . . . . . . . . . . . 91
SECTION 11.11. Benefits of Indenture. . . . . . . . . . . . . . . 92
SECTION 11.12. Legal Holidays . . . . . . . . . . . . . . . . . . 92
SECTION 11.13. Governing Law. . . . . . . . . . . . . . . . . . . 92
SECTION 11.14. Counterparts . . . . . . . . . . . . . . . . . . . 92
SECTION 11.15. Recording of Indenture . . . . . . . . . . . . . . 92
SECTION 11.16. No Petition. . . . . . . . . . . . . . . . . . . . 92
SECTION 11.17. Inspection . . . . . . . . . . . . . . . . . . . . 92
SECTION 11.18. Limitation of Liability. . . . . . . . . . . . . . 93
SECTION 11.19. Amendment of Cash Collateral Account Agreement . . 93
Testimonium, Signatures and Seals. . . . . . . . . . . . . . . . . . 95
Exhibit A Form of Depository Agreement
Exhibit B Form of Monthly Statements to Noteholders and Equity
Certificateholders
Exhibit C-1 Form of Class A Note
Exhibit C-2 Form of Class B Note
-iv-
<PAGE>
INDENTURE, dated as of October 1, 1996, between CAPITA EQUIPMENT
RECEIVABLES TRUST 1996-1, a trust formed pursuant to the laws of the State of
New York (the "Issuer"), and THE CHASE MANHATTAN BANK, a New York banking
corporation, in its capacity as Trustee (the "Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Issuer's 5.60%
Receivable-Backed Notes, Class A-1 (the "Class A-1 Notes"), 5.95%
Receivable-Backed Notes, 6.11% Receivable-Backed Notes, Class A-2 (the "Class
A-2 Notes"), 6.28% Receivable-Backed Notes, Class A-3 (the "Class A-3 Notes"),
6.57% Receivable-Backed Notes, Class A-4 (the "Class A-4 Notes"), and Class B
(the "Class B Notes" and, together with the Class A-1 Notes, the Class A-2
Notes, the Class A-3 Notes and the Class A-4 Notes, the "Notes"):
As security for the payment and performance by the Issuer of its
obligations under this Indenture and the Notes, the Issuer hereby Grants to the
Trustee, on behalf of and for the benefit of the Noteholders to secure the
payment and performance of the Secured Obligations, the following (collectively,
the "Trust Estate"):
GRANTING CLAUSE FIRST
All rights, title, interest (including security interests) and
privileges of the Issuer, whether now owned or hereafter acquired, whether now
existing or hereafter arising and wherever located, in and to:
(a) the Contracts and the related Equipment (subject to the rights of
the Depositor therein, as set forth in the Transfer and Servicing
Agreement);
(b) the Pledged Revenues;
(c) the Trust Accounts;
(d) the Cash Collateral Account and the Insurance, Maintenance and
Tax Accounts;
(e) the Transfer and Servicing Agreement, including (i) any deemed
loan made by the Issuer to the Depositor and the security therefor,
including the security interest granted by the Depositor to the Issuer to
secure such deemed loan, as described in Section 9.8 of the Transfer and
Servicing Agreement, and (ii) the obligation of the Depositor pursuant to
Section 2.1(a)(i)(3) of the Transfer and Servicing Agreement to cause
payment of the allocable portion of Liquidation Proceeds to the Issuer and
the security interest in the Leased Equipment granted by the Depositor to
the Issuer pursuant to Section 2.1(c) of the Transfer and Servicing
Agreement;
<PAGE>
(f) the Purchase Agreement, including (i) any Purchase Amount paid
(other than any portion thereof attributable to the Book Value of the
Leased Equipment) and (ii) any deemed loan made by the Depositor to the
Originators and the security therefor, including the security interest in
the Contracts and Equipment granted by the Originators to the Depositor to
secure such deemed loan, as described in Section 2.2 of the Purchase
Agreement; and
(g) all present and future claims, demands, causes and choses in
action in respect of any or all of the foregoing and all payments on or
under and all proceeds of every kind and nature whatsoever 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, accounts receivables, 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 which at any
time constitute all or part of or are included in the proceeds of any of
the foregoing.
GRANTING CLAUSE SECOND
All other property of every name and nature from time to time
hereafter by delivery or by writing of any kind conveyed, pledged, assigned or
transferred, as and for additional security hereunder by the Issuer or by anyone
in its behalf or with its written consent to the Trustee, which is hereby
authorized to receive any and all such property at any and all times and to hold
and apply the same subject to the terms hereof.
The Trustee, for the benefit of the Holders of the Notes, acknowledges
such Grant. The Trustee, on behalf of the Holders of the Notes, accepts the
trusts under this Indenture in accordance with the provisions of this Indenture
and agrees to perform its duties required in this Indenture to the best of its
ability to the end that the interests of the Holders of the Notes may be
adequately and effectively protected.
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
All terms defined in the Transfer and Servicing Agreement or the Trust
Agreement (each as defined below) shall have the same meaning in this Indenture.
Except as otherwise specified herein or as the context may otherwise require,
the following terms have the respective meanings set forth below for all
purposes of this Indenture.
"ACCOUNTING DATE" means, with respect to a Payment Date, the last day
of the preceding calendar month.
"ACT" has the meaning specified in Section 11.03(a).
"AFFILIATE" means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect
to any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"AGGREGATE PRINCIPAL BALANCE" means, as of any date, the aggregate of
the Principal Balances of each Class of Notes.
"AMOUNT AVAILABLE" means, with respect to any Payment Date, the sum of
(i) the Available Pledged Revenues for such Payment Date, and (ii) that portion
of the balance in the Cash Collateral Account available for withdrawal by the
Trustee in accordance with Section 8.06(c).
"AUTHORIZED OFFICER" means, with respect to the Issuer, any officer of
the Owner Trustee who is authorized to act for the Owner Trustee in matters
relating to the Issuer and who is identified on the list of Authorized Officers
delivered by the Owner Trustee to the Trustee on the Closing Date (as such list
may be modified or supplemented from time to time thereafter).
"AVAILABLE CASH COLLATERAL AMOUNT" means, with respect to a Payment
Date, the amount of funds equal to the lesser of (i) the amount on deposit in
the Cash Collateral Account (determined (a) exclusive of any net investment
earnings thereon, and (b) before giving effect to any deposit to be made to or
withdrawals from the Cash Collateral Account with respect to such Payment Date),
and (ii) the Requisite Cash Collateral Amount.
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"AVAILABLE PLEDGED REVENUES" means, with respect to any Payment Date,
the sum of (i) the Related Collection Period Pledged Revenues for such Payment
Date, (ii) all Purchase Amounts (other than any portion thereof attributable to
the Book Value of the Leased Equipment) on deposit in the Collection Account as
of the immediately preceding Deposit Date, (iii) the amount paid by the
Depositor to purchase the Contracts pursuant to Section 5.1 of the Transfer and
Servicing Agreement on deposit in the Collection Account as of the immediately
preceding Deposit Date, (iv) all net income from investments of funds in the
Collection Account and the Note Distribution Account during the related
Collection Period, and (v) to the extent necessary to pay the Note Interest
Distributable Amount and the Equity Certificate Interest Distributable Amount
for such Payment Date, the Current Collection Period Pledged Revenues for such
Payment Date.
"BOOK-ENTRY NOTE" means any Note registered in the name of the
Depository or its nominee, ownership of which is reflected on the books of the
Depository or on the books of a person maintaining an account with such
Depository (directly or as an indirect participant in accordance with the rules
of such Depository).
"BUSINESS DAY" means any day (other than a Saturday, Sunday or legal
holiday) on which commercial banking institutions in New York, New York, or any
other location of any successor Servicer or successor Trustee, are open for
regular business.
"CASH COLLATERAL ACCOUNT" means the Eligible Account established and
maintained by the Trustee in accordance with Section 8.06.
"CASH COLLATERAL ACCOUNT AGREEMENT" means the Loan Agreement, dated as
of October 15, 1996, among the Depositor, the Owner Trustee, the Trustee, the
Cash Collateral Account Lenders and the Cash Collateral Account Lenders' Agent,
as the same may be amended, supplemented or otherwise modified in accordance
with the terms thereof.
"CASH COLLATERAL ACCOUNT LENDERS" means the parties identified as
lenders in the Cash Collateral Account Agreement.
"CASH COLLATERAL ACCOUNT LENDERS' AGENT" means the party identified as
agent for the Cash Collateral Account Lenders in the Cash Collateral Account
Agreement.
"CLASS" means, when used with respect to the Notes, all Notes of a
given Class.
"CLASS A NOTES" means, collectively, the Class A-1 Notes, the Class
A-2 Notes, the Class A-3 Notes and the Class A-4 Notes.
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"CLASS A-1 INTEREST CARRYOVER SHORTFALL" means, with respect to any
Payment Date, the excess, if any, of the Class A-1 Interest Distributable Amount
for the preceding Payment Date over the amount that was actually distributed in
respect of interest on the Class A-1 Notes on such preceding Payment Date, plus,
to the extent permitted by law, an amount equal to one-twelfth of the product of
(i) the Class A-1 Interest Rate and (ii) such excess.
"CLASS A-1 INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Payment Date, the sum of the Class A-1 Monthly Interest Distributable Amount and
the Class A-1 Interest Carryover Shortfall for such Payment Date.
"CLASS A-1 INTEREST RATE" means 5.60% per annum.
"CLASS A-1 MONTHLY INTEREST DISTRIBUTABLE AMOUNT" means, with respect
to any Payment Date, an amount equal to one-twelfth of the product of (i) the
Class A-1 Interest Rate and (ii) the Principal Balance of the Class A-1 Notes on
the immediately preceding Payment Date, after giving effect to all payments of
principal to Class A-1 Noteholders on or prior to such immediately preceding
Payment Date (or, in the case of the first Payment Date, the Original Principal
Balance of the Class A-1 Notes).
"CLASS A-1 NOTES" means the 5.60% Receivable-Backed Notes, Class A-1,
substantially in the form of Exhibit C-1.
"CLASS A-1 STATED MATURITY DATE" means October 15, 1997 (or, if such
day is not a Business Day, the next succeeding Business Day thereafter).
"CLASS A-2 INTEREST CARRYOVER SHORTFALL" means, with respect to any
Payment Date, the excess, if any, of the Class A-2 Interest Distributable Amount
for the preceding Payment Date over the amount that was actually distributed in
respect of interest on the Class A-2 Notes on such preceding Payment Date, plus,
to the extent permitted by law, an amount equal to one-twelfth of the product of
(i) the Class A-2 Interest Rate and (ii) such excess.
"CLASS A-2 INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Payment Date, the sum of the Class A-2 Monthly Interest Distributable Amount and
the Class A-2 Interest Carryover Shortfall for such Payment Date.
"CLASS A-2 INTEREST RATE" means 5.95% per annum.
"CLASS A-2 MONTHLY INTEREST DISTRIBUTABLE AMOUNT" means, with respect
to any Payment Date, an amount equal to one-twelfth of the product of (i) the
Class A-2 Interest Rate and (ii) the Principal Balance of the Class A-2 Notes on
the immediately preceding Payment Date, after giving effect to all payments of
principal to Class A-2 Noteholders on or prior to such immediately preceding
Payment Date (or, in the case of the first Payment Date, the Original Principal
Balance of the Class A-2 Notes).
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"CLASS A-2 NOTES" means the 5.95% Receivable-Backed Notes, Class A-2,
substantially in the form of Exhibit C-1.
"CLASS A-2 STATED MATURITY DATE" means July 15, 1998 (or, if such day
is not a Business Day, the next succeeding Business Day thereafter).
"CLASS A-3 INTEREST CARRYOVER SHORTFALL" means, with respect to any
Payment Date, the excess, if any, of the Class A-3 Interest Distributable Amount
for the preceding Payment Date over the amount that was actually distributed in
respect of interest on the Class A-3 Notes on such preceding Payment Date, plus,
to the extent permitted by law, an amount equal to one-twelfth of the product of
(i) the Class A-3 Interest Rate and (ii) such excess.
"CLASS A-3 INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Payment Date, the sum of the Class A-3 Monthly Interest Distributable Amount and
the Class A-3 Interest Carryover Shortfall for such Payment Date.
"CLASS A-3 INTEREST RATE" means 6.11% per annum.
"CLASS A-3 MONTHLY INTEREST DISTRIBUTABLE AMOUNT" means, with respect
to any Payment Date, an amount equal to one-twelfth of the product of (i) the
Class A-3 Interest Rate and (ii) the Principal Balance of the Class A-3 Notes on
the immediately preceding Payment Date, after giving effect to all payments of
principal to Class A-3 Noteholders on or prior to such immediately preceding
Payment Date (or, in the case of the first Payment Date, the Original Principal
Balance of the Class A-3 Notes).
"CLASS A-3 NOTES" means the 6.11% Receivable-Backed Notes, Class A-3,
substantially in the form of Exhibit C-1.
"CLASS A-3 STATED MATURITY DATE" means July 15, 1999 (or, if such day
is not a Business Day, the next succeeding Business Day thereafter).
"CLASS A-4 INTEREST CARRYOVER SHORTFALL" means, with respect to any
Payment Date, the excess, if any, of the Class A-4 Interest Distributable Amount
for the preceding Payment Date over the amount that was actually distributed in
respect of interest on the Class A-4 Notes on such preceding Payment Date, plus,
to the extent permitted by law, an amount equal to one-twelfth of the product of
(i) the Class A-4 Interest Rate and (ii) such excess.
"CLASS A-4 INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Payment Date, the sum of the Class A-4 Monthly Interest Distributable Amount and
the Class A-4 Interest Carryover Shortfall for such Payment Date.
"CLASS A-4 INTEREST RATE" means 6.28% per annum.
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"CLASS A-4 MONTHLY INTEREST DISTRIBUTABLE AMOUNT" means, with respect
to any Payment Date, an amount equal to one-twelfth of the product of (i) the
Class A-4 Interest Rate and (ii) the Principal Balance of the Class A-4 Notes on
the immediately preceding Payment Date, after giving effect to all payments of
principal to Class A-4 Noteholders on or prior to such immediately preceding
Payment Date (or, in the case of the first Payment Date, the Original Principal
Balance of the Class A-4 Notes).
"CLASS A-4 NOTES" means the 6.28% Receivable-Backed Notes, Class A-4,
substantially in the form of Exhibit C-1.
"CLASS A-4 STATED MATURITY DATE" means June 15, 2000 (or, if such day
is not a Business Day, the next succeeding Business Day thereafter).
"CLASS B INTEREST CARRYOVER SHORTFALL" means, with respect to any
Payment Date, the excess, if any, of the Class B Interest Distributable Amount
for the preceding Payment Date over the amount that was actually distributed in
respect of interest on the Class B Notes on such preceding Payment Date, plus,
to the extent permitted by law, an amount equal to one-twelfth of the product of
(i) the Class B Interest Rate and (ii) such excess.
"CLASS B INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Payment Date, the sum of the Class B Monthly Interest Distributable Amount and
the Class B Interest Carryover Shortfall for such Payment Date.
"CLASS B INTEREST RATE" means 6.57% per annum.
"CLASS B MONTHLY INTEREST DISTRIBUTABLE AMOUNT" means, with respect to
any Payment Date, an amount equal to one-twelfth of the product of (i) the Class
B Interest Rate and (ii) the Principal Balance of the Class B Notes on the
immediately preceding Payment Date, after giving effect to all payments of
principal to Class B Noteholders on or prior to such immediately preceding
Payment Date (or, in the case of the first Payment Date, the Original Principal
Balance of the Class B Notes).
"CLASS B NOTES" means the 6.57% Receivable-Backed Notes, Class B,
substantially in the form of Exhibit C-2.
"CLASS B STATED MATURITY DATE" means March 15, 2001 (or, if such day
is not a Business Day, the next succeeding Business Day thereafter).
"CLOSING DATE" means October 15, 1996.
"CODE" means the Internal Revenue Code of 1986, as amended from time
to time, and Treasury Regulations promulgated thereunder.
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"COLLECTION ACCOUNT" means the Eligible Account or Accounts
established and maintained by the Trustee in accordance with Section 8.02.
"COLLECTION PERIOD" means, with respect to any Payment Date, the
calendar month preceding the month in which such Payment Date occurs (such
calendar month being referred to as the "related" Collection Period with respect
to such Payment Date). With respect to an Accounting Date, the Collection
Period in which such Accounting Date occurs is referred to herein as the
"related" Collection Period with respect to such Accounting Date.
"CONTRACT POOL PRINCIPAL BALANCE" means, with respect to any Payment
Date, the sum of the Contract Principal Balances (computed as of the related
Accounting Date) for all Contracts.
"CONTRACT PRINCIPAL BALANCE" means, as of any Accounting Date:
(i) in the case of a Lease Contract, the present value of the unpaid
Scheduled Payments due on such Lease Contract after such Accounting Date
(excluding all Scheduled Payments due on or prior to, but not received as
of, such Accounting Date, as well as any Scheduled Payments due after, but
received as of, such Accounting Date), after giving effect to any
Prepayments received on or prior to such Accounting Date, discounted
monthly at the rate of 8.10% per annum (assuming, for purposes of such
calculation, that each Scheduled Payment is due on the last day of the
applicable Collection Period); and
(ii) in the case of a Loan Contract, the lesser of (a) the unpaid
principal balance of such Loan Contract as of such Accounting Date (after
giving effect to any Scheduled Payments due on or prior to such Accounting
Date, whether or not received, as well as any Prepayments, and any
Scheduled Payments due after such Accounting Date, received as of such
Accounting Date), and (b) the present value of the unpaid Scheduled
Payments due on such Loan Contract after such Accounting Date (excluding
all Scheduled Payments due on or prior to, but not received as of, such
Accounting Date, as well as any Scheduled Payments due after, but received
as of, such Accounting Date), after giving effect to any Prepayments
received on or prior to such Accounting Date, discounted monthly at the
rate of 8.10% per annum (assuming, for purposes of such calculation, that
each Scheduled Payment is due on the last day of the applicable Collection
Period);
PROVIDED that, for purposes of computing the Monthly Principal Amount or the
Requisite Cash Collateral Amount for a given Payment Date (as well as all
Payment Dates thereafter), the Contract Principal Balance of any Contract which
became a Liquidated Contract during the related Collection Period or was
required to be purchased by TCC as of the last day of the related Collection
Period in accordance with
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Section 2.6 of the Transfer and Servicing Agreement, will be deemed to be zero
on and after the last day of such Collection Period.
"CONTRACTS" means the Lease Contracts and the Loan Contracts.
"CORPORATE TRUST OFFICE" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at date of the execution of this Agreement is located at 450 West
33rd Street, New York, New York 10001, Attention: Advance Structured Products
Group; or at such other address as the Trustee may designate from time to time
by notice to the Noteholders and the Issuer, or the principal corporate trust
office of any successor Trustee (the address of which the successor Trustee will
notify the Noteholders and the Issuer).
"CURRENT COLLECTION PERIOD PLEDGED REVENUES" means, with respect to
any Payment Date, the amount of Pledged Revenues in the Collection Account as of
the immediately preceding Deposit Date which were received by the Servicer after
the related Collection Period, including all Liquidation Proceeds so received
but excluding any Purchase Amounts.
"CURRENT REALIZED LOSSES" means, with respect to any Payment Date, the
aggregate Liquidation Losses of all Contracts that became Liquidated Contracts
during the related Collection Period.
"CUT-OFF DATE" means October 1, 1996.
"CUT-OFF DATE CONTRACT POOL PRINCIPAL BALANCE" is $3,185,229,329.
"DEFAULT" means any occurrence that is, or with notice or the lapse of
time or both would become, an Event of Default.
"DEPOSIT DATE" means, with respect to any Collection Period, the
Business Day immediately preceding the related Determination Date.
"DEFINITIVE NOTES" means any Note evidenced by a definitive, fully
registered Note and any Note issued in lieu of a Book-Entry Note pursuant to
Section 2.11.
"DEPOSITOR" means Antigua Funding Corporation, a Delaware corporation.
"DEPOSITORY" means the initial Depository, The Depository Trust
Company, the nominee of which is Cede & Co., as the registered Holder of the
Class A Notes and the Class B Notes as of the Closing Date, and any permitted
successor depository. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(3) of the Uniform Commercial Code of
the State of New York.
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"DEPOSITORY AGREEMENT" means the agreement among the Issuer, the
Trustee and The Depository Trust Company, as the initial Depository, dated as of
the Closing Date, relating to the Notes, substantially in the form of Exhibit A.
"DEPOSITORY PARTICIPANT" means a broker, dealer, bank or other
financial institution or other Person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.
"DETERMINATION DATE" means, with respect to any Collection Period, the
fifth Business Day immediately preceding the related Payment Date.
"DUFF & PHELPS" means Duff & Phelps Credit Rating Co., or any
successor thereto.
"ELIGIBLE ACCOUNT" means (i) an account maintained at an Eligible
Institution; (ii) an account or accounts the deposits in which are fully insured
by either the Bank Insurance Fund or the Savings Association Insurance Fund of
the FDIC; (iii) a trust account (which shall be a "segregated trust account")
maintained with the corporate trust department of a federal or state chartered
depository institution or trust company with trust powers and acting in its
fiduciary capacity for the benefit of the Trustee, which depository institution
or trust company (or, if such depository institution or trust company is a
subsidiary of a bank holding company, such bank holding company) shall have
capital and surplus of not less than $50,000,000 and the securities of such
depository institution or trust company (or, if such depository institution or
trust company is a subsidiary of a bank holding company and has no securities
which are rated, the securities of such bank holding company) shall have a
credit rating from each of the Rating Agencies (if rated by such Rating Agency)
in one of its generic credit rating categories which signifies investment grade;
or (iv) an account that will not cause any Rating Agency to downgrade or
withdraw its then-current rating assigned to the Notes or the Equity
Certificates, as confirmed in writing by such Rating Agency.
"ELIGIBLE INSTITUTION" means any depository institution (which may be
the Trustee or an Affiliate of the Trustee) organized under the laws of the
United States or any state, the deposits of which are insured to the full extent
permitted by law by the Bank Insurance Fund of the FDIC, which is subject to
supervision and examination by federal or state authorities and whose short-term
deposits, commercial paper or other short-term debt obligations have been rated
at least P-1 by Moody's, A-1 by S&P, F-1 by Fitch (if rated by Fitch) and D-1 by
Duff & Phelps (if rated by Duff & Phelps) or whose unsecured long-term debt has
been rated in one of the two highest rating categories by each Rating Agency (if
rated by such Rating Agency).
"ELIGIBLE INVESTMENTS" means any one or more of the following types of
investments:
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(i) direct obligations of, and obligations fully guaranteed as
to timely receipt of principal and interest by, the United States of
America, or any agency or instrumentality of the United States of America
the obligations of which are backed by the full faith and credit of the
United States of America;
(ii) (A) demand and time deposits in, certificates of deposit of,
bankers' acceptances issued by, or federal funds sold by any depository
institution or trust company (including the Trustee or any Affiliate of the
Trustee, acting in its commercial capacity) incorporated under the laws of
the United States of America or any state thereof and subject to
supervision and examination by federal or state authorities, so long as, at
the time of such investment or contractual commitment providing for such
investment, the short-term deposits, commercial paper or other short-term
debt obligations of such depository institution or trust company are rated
at least P-1 by Moody's, A-1+ by S&P, F-1+ by Fitch (if rated by Fitch) and
D-1+ by Duff & Phelps (if rated by Duff & Phelps); and (B) any other demand
or time deposit or certificate of deposit which is fully insured by the
Bank Insurance Fund of the FDIC;
(iii) shares of an investment company registered under the
Investment Company Act of 1940, whose shares are registered under the
Securities Act of 1933, as amended, and have a rating from each of the
Rating Agencies in its highest rating category;
(iv) repurchase obligations with respect to (A) any security
described in clause (i) above or (B) any other security issued or
guaranteed by an agency or instrumentality of the United States of America,
in either case entered into with a depository institution or trust company
(acting as principal) described in clause (ii)(A) above;
(v) securities bearing interest or sold at a discount issued by
any corporation incorporated under the laws of the United States of America
or any state thereof which, at the time of such investment, have a credit
rating of at least Aa3 from Moody's, AAA from S&P, AAA from Fitch (if rated
by Fitch) and AAA from Duff & Phelps (if rated by Duff & Phelps);
(vi) commercial paper having a rating of at least P-1 by Moody's,
A-1+ by S&P, F-1+ by Fitch (if rated by Fitch) and D-1+ by Duff & Phelps
(if rated by Duff & Phelps) at the time of such investment;
(vii) investments in money market funds rated in the highest
rating category by each of Moody's, S&P, Fitch (if rated by Fitch) and Duff
& Phelps (if rated by Duff & Phelps); and
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(viii) any other investment which will not cause any Rating Agency
to downgrade or withdraw its then-current rating assigned to the Notes or
the Equity Certificates, as confirmed in writing by such Rating Agency.
Eligible Investments may be purchased by or through the Trustee or any of its
Affiliates.
"EQUIPMENT" means, with respect to any Contract, the property which is
leased or purchased pursuant to such Contract, or which otherwise provides
security for the payment of amounts payable thereunder.
"EQUITY CERTIFICATE BALANCE" means, as of any date, the Original
Equity Certificate Balance less all distributions previously made to the Equity
Certificates in respect of principal.
"EQUITY CERTIFICATE INTEREST CARRYOVER SHORTFALL" means, with respect
to any Payment Date, the excess, if any, of the Equity Certificate Interest
Distributable Amount for the preceding Payment Date over the amount that was
actually distributed in respect of interest on the Equity Certificates on such
preceding Payment Date, plus, to the extent permitted by law, an amount equal to
one-twelfth of the product of (i) the Equity Certificate Interest Rate and (ii)
such excess.
"EQUITY CERTIFICATE INTEREST DISTRIBUTABLE AMOUNT" means, with respect
to any Payment Date, the sum of the Equity Certificate Monthly Interest
Distributable Amount and the Equity Certificate Interest Carryover Shortfall for
such Payment Date.
"EQUITY CERTIFICATE INTEREST RATE" means 6.75% per annum.
"EQUITY CERTIFICATE MONTHLY INTEREST DISTRIBUTABLE AMOUNT" means, with
respect to any Payment Date, an amount equal to one-twelfth of the product of
(i) the Equity Certificate Interest Rate and (ii) the Equity Certificate Balance
on the immediately preceding Payment Date, after giving effect to all payments
of principal to Equity Certificateholders on or prior to such immediately
preceding Payment Date (or, in the case of the first Payment Date, the Original
Equity Certificate Balance).
"EQUITY CERTIFICATE POOL FACTOR" means, with respect to any Payment
Date and the Equity Certificates, an six-digit decimal figure equal to the
Equity Certificate Balance as of such Payment Date (after giving effect to all
distributions on such date) divided by the original Equity Certificate Balance.
"EQUITY CERTIFICATE PRINCIPAL DISTRIBUTABLE AMOUNT" means, with
respect to any Payment Date (other than the Equity Certificate Stated Maturity
Date), the Equity Certificateholders' Percentage of the Monthly Principal Amount
for such Payment Date. The "Equity Certificate Principal Distributable Amount"
on the Equity Certificate Stated Maturity Date will equal the Equity Certificate
Balance as of such
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Stated Maturity Date. In no event may the Equity Certificate Principal
Distributable Amount for any Payment Date exceed the Equity Certificate Balance
immediately prior to such Payment Date.
"EQUITY CERTIFICATE STATED MATURITY DATE" means September 15, 2004
(or, if such day is not a Business Day, the next succeeding Business Day
thereafter).
"EQUITY CERTIFICATEHOLDER" means the holder of an Equity Certificate.
It is expected that the Depositor, as the original holder of the Equity
Certificates, will assign the Equity Certificates to the Revolving Trust Trustee
in connection with the transactions contemplated hereby and by the Related
Documents. As such, until notified to the contrary and at the direction of the
Depositor, the Trustee shall be entitled to treat the Revolving Trust Trustee as
the holder of all Equity Certificates for all purposes of this Indenture. In
the event that the Issuer is terminated pursuant to Section 9.1(b) of the Trust
Agreement and the Equity Certificates are canceled, all rights hereunder
provided in respect of the Equity Certificates (including the right to receive
distributions of principal, interest and other amounts described herein) shall
automatically vest in the successor in interest to the Equity
Certificateholders, as such successor in interest shall be identified by the
Revolving Trust Trustee.
"EQUITY CERTIFICATEHOLDERS' PERCENTAGE" means, with respect to any
Payment Date, 100% minus the Noteholders' Percentage as of such Payment Date.
"EVENT OF DEFAULT" has the meaning specified in Section 5.01.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXECUTIVE OFFICER" means, with respect to any corporation, the Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer, President,
Executive Vice President, any Vice President, any Responsible Officer, the
Secretary or the Treasurer of such corporation; and with respect to any
partnership, any general partner thereof.
"FITCH" means Fitch Investors Service, L.P., or any successor thereto.
"GRANT" means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, and grant a lien upon and a
security interest in and right of set-off against, deposit, set over and confirm
pursuant to this Indenture. A Grant of the Trust Estate or of any other
agreement or instrument shall include all rights, powers and options (but none
of the obligations) of the Granting party thereunder, including the immediate
and continuing right to claim for, collect, receive and give receipt for
principal and interest payments in respect of the Trust Estate and all other
moneys 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
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generally to do and receive anything that the Granting party is or may be
entitled to do or receive thereunder or with respect thereto.
"HOLDER" or "NOTEHOLDER" means the Person in whose name a Note is
registered on the Note Register.
"INDEBTEDNESS" means, with respect to any Person at any time, (a)
indebtedness or liability of such Person for borrowed money whether or not
evidenced by bonds, debentures, notes or other instruments, or for the deferred
purchase price of property or services (including trade obligations); (b)
obligations of such Person as lessee under leases which should have been or
should be, in accordance with generally accepted accounting principles, recorded
as capital leases; (c) current liabilities of such Person in respect of unfunded
vested benefits under plans covered by Title IV of ERISA; (d) obligations issued
for or liabilities incurred on the account of such Person; (e) obligations or
liabilities of such Person arising under acceptance facilities; (f) obligations
of such Person under any guarantees, endorsements (other than for collection or
deposit in the ordinary course of business) and other contingent obligations to
purchase, to provide funds for payment, to supply funds to invest in any Person
or otherwise to assure a creditor against loss; (g) obligations of such Person
secured by any lien on property or assets of such Person, whether or not the
obligations have been assumed by such Person; or (h) obligations of such Person
under any interest rate or currency exchange agreement.
"INDENTURE" means this Indenture as amended or supplemented from time
to time.
"INDEPENDENT" means, when used with respect to any specified Person,
that the Person (a) is in fact independent of the Issuer, any other obligor upon
the Notes, the Depositor, the Servicer and any Affiliate of any of the foregoing
Persons, (b) does not have any direct financial interest or any material
indirect financial interest in the Issuer, any such other obligor, the
Depositor, the Servicer or any Affiliate of any of the foregoing Persons and (c)
is not connected with the Issuer, any such other obligor, the Depositor, the
Servicer or any Affiliate of any of the foregoing Persons as an officer,
employee, promoter, underwriter, trustee, partner, director or person performing
similar functions.
"INDEPENDENT CERTIFICATE" means a certificate or opinion to be
delivered to the Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.01, made by an
Independent appraiser or other expert appointed by an Issuer Order and approved
by the Trustee in the exercise of reasonable care, and such opinion or
certificate shall state that the signer has read the definition of "Independent"
in this Indenture and that the signer is Independent within the meaning thereof.
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"INTEREST RATE" means the Class A-1 Interest Rate, the Class A-2
Interest Rate, the Class A-3 Interest Rate, the Class A-4 Interest Rate and the
Class B Interest Rate, as applicable.
"ISSUER" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision contained herein and required by the TIA, each other obligor on
the Notes.
"ISSUER ORDER" and "ISSUER REQUEST" means a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and
delivered to the Trustee.
"LEASE CONTRACTS" means the lease contracts listed on Exhibit A-1 to
the Transfer and Servicing Agreement (excluding any such lease contract which
has become a Purchased Contract) and all rights and obligations under such
contracts, including, without limitation, all monies at any time paid or payable
thereon or in respect thereof from and after the Cut-Off Date (whether in the
form of (i) Scheduled Payments (including those Scheduled Payments due prior to,
but not received as of, the Cut-Off Date, but excluding those Scheduled Payments
due on or after, but received prior to, the Cut-Off Date), (ii) Prepayments,
(iii) Liquidation Proceeds, (iv) Extension Fees, (v) payments to be applied by
the Servicer to the payment of insurance charges, maintenance, taxes or other
similar obligations, (vi) payments to be retained by the Servicer in payment of
Administrative Fees, or otherwise), and all rights of the lessor in the related
Equipment (other than any ownership interest of the lessor in such Equipment),
Insurance Policies and any other security for the payment of amounts due under
such contracts.
"LIEN" means any security interest, lien, charge, pledge, preference,
equity or encumbrance of any kind, including tax liens, mechanics' liens and any
liens that attach by operation of law.
"LIQUIDATED CONTRACT" means, with respect to any Collection Period,
(i) a Contract which, during such Collection Period, was charged off as
uncollectible by the Servicer in accordance with its credit and collection
policies and procedures (which shall be no later than the date as of which the
Servicer has repossessed and disposed of the related Equipment and otherwise
collected all proceeds (including any proceeds of insurance to be applied as
described in Section 3.4(c)(ii) of the Transfer and Servicing Agreement) which,
in the Servicer's reasonable judgment, can be collected under such Contract)
following a default thereunder or upon damage to or destruction of such
Equipment (if such Equipment is not to be replaced in accordance with Section
3.4(c)(i) of the Transfer and Servicing Agreement), or (ii) a Contract as to
which, during such Collection Period, 10% or more of a Scheduled Payment shall
have become 180 days delinquent.
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"LIQUIDATION LOSS" means, with respect to any Liquidated Contract, the
amount, if any, by which (a) the Required Payoff Amount for such Liquidated
Contract as of the date such Contract became a Liquidated Contract exceeds (b)
that portion of the Liquidation Proceeds for such Liquidated Contract allocated
to the Issuer.
"LIQUIDATION PROCEEDS" means all amounts received by the Servicer (i)
in connection with the liquidation of any Contract and disposition of the
related Equipment or (ii) as insurance proceeds with respect to any damaged or
destroyed Equipment to be applied as described in Section 3.4(c)(ii) of the
Transfer and Servicing Agreement, in each case net of (a) reasonable
out-of-pocket expenses incurred by or on behalf of the Servicer in connection
with the collection of such Contract and the maintenance, repossession, repair,
storage and disposition of the related Equipment (including taxes and insurance
charges, to the extent in excess of amounts available therefor and relating to
such Contract in the Insurance, Maintenance and Tax Accounts, as well as
attorneys' fees) and (b) amounts that are required to be refunded to the Obligor
on such Contract; PROVIDED, HOWEVER, that the Liquidation Proceeds with respect
to any Contract and disposition of the related Equipment shall in no event be
less than zero. Liquidation Proceeds shall be allocated as follows: (1) in the
case of any Loan Contract, all Liquidation Proceeds shall be allocated to the
Issuer; and (2) in the case of any Lease Contract, Liquidation Proceeds shall be
allocated pro rata between the Issuer, on the one hand, and the Depositor, on
the other, based upon the Required Payoff Amount for such Lease Contract
(determined as of the Collection Period during which such Lease Contract became
a Liquidated Contract) and the Book Value of the related Leased Equipment,
respectively; PROVIDED that, in the event the Liquidation Proceeds exceed the
sum of the Required Payoff Amount for a given Lease Contract plus the Book Value
of the related Leased Equipment, any such excess shall be allocated solely to
the Depositor.
"LOAN CONTRACTS" means the installment sale contracts, promissory
notes, loan and security agreements and other similar types of receivables
listed on Exhibit A-2 to the Transfer and Servicing Agreement (excluding any
such contract, note, agreement or receivable which has become a Purchased
Contract) and all rights and obligations under such contracts, including,
without limitation, all monies at any time paid or payable thereon or in respect
thereof from and after the Cut-Off Date (whether in the form of (i) Scheduled
Payments (including those Scheduled Payments due prior to, but not received as
of, the Cut-Off Date, but excluding those Scheduled Payments due on or after,
but received prior to, the Cut-Off Date), (ii) Prepayments, (iii) Liquidation
Proceeds, (iv) Extension Fees, (v) payments to be applied by the Servicer to the
payment of insurance charges, maintenance, taxes or other similar obligations,
(vi) payments to be retained by the Servicer in payment of Administrative Fees,
or otherwise), and all rights of the secured party in the related Equipment,
Insurance Policies and any other security for the payment of amounts due under
such contracts.
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"LUXEMBOURG LISTING AGENT" has the meaning ascribed thereto in Section
3.23.
"LUXEMBOURG PAYING AGENT" has the meaning ascribed thereto in Section
3.23.
"MONTHLY PRINCIPAL AMOUNT" means, with respect to any Payment Date,
the excess, if any, of (i) the sum of the Aggregate Principal Balance of the
Notes and the Equity Certificate Balance as of such Payment Date (determined
prior to the payment of any principal in respect thereof on such Payment Date),
over (ii) the Contract Pool Principal Balance as of the last day of the
Collection Period relating to such Payment Date.
"MOODY'S" means Moody's Investors Service, Inc., or any successor
thereto.
"NOTE" means a Class A-1 Note, Class A-2 Note, Class A-3 Note, Class
A-4 Note or Class B Note, as applicable.
"NOTE DISTRIBUTION ACCOUNT" means the Eligible Account or Accounts
established and maintained by the Trustee in accordance with Section 8.04.
"NOTE INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Payment Date, the sum of the Class A-1 Interest Distributable Amount, the Class
A-2 Interest Distributable Amount, the Class A-3 Interest Distributable Amount,
the Class A-4 Interest Distributable Amount and the Class B Interest
Distributable Amount.
"NOTE MAJORITY" means Holders representing a majority of the Principal
Balance of each Class of the Notes then Outstanding.
"NOTE OWNER" means, with respect to a Book-Entry Note, the Person who
is the beneficial owner of such Book-Entry Note, as reflected on the books of
the Depository, or on the books of a Person maintaining an account with such
Depository (directly or as an indirect participant, in each case in accordance
with the rules of such Depository) and with respect to any Definitive Notes, the
Holder.
"NOTE POOL FACTOR" means, with respect to any Payment Date and each
Class of Notes, an six-digit decimal figure equal to the Principal Balance of
such Class of Notes as of such Payment Date (after giving effect to all
distributions on such date) divided by the original Principal Balance of such
Class of Notes.
"NOTE PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any
Payment Date (other than the Stated Maturity Date with respect to any Class of
Notes), the Noteholders' Percentage of the Monthly Principal Amount for such
Payment Date. The Note Principal Distributable Amount on the Stated Maturity
Date for any Class of
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Notes will equal the sum of (i) the Noteholders' Percentage of the Monthly
Principal Amount, plus (ii) the excess, if any, of the Principal Balance of such
Class of Notes over the amount in clause (i). In no event may the Note
Principal Distributable Amount for any Payment Date exceed the Principal Balance
of the Notes immediately prior to such Payment Date.
"NOTE REGISTER" and "NOTE REGISTRAR" have the respective meanings
specified in Section 2.04.
"NOTEHOLDERS' PERCENTAGE" means, (i) with respect to any Payment Date
prior to the Payment Date on which the Equity Certificate Balance is reduced to
$95,659,329, 97.70%, (ii) with respect to the Payment Date on which the Equity
Certificate Balance is reduced to $95,659,329, the greater of (a) 97.70%, and
(b) 100% less that percentage of the Monthly Principal Amount for such Payment
Date which is necessary to reduce the Equity Certificate Balance to $95,659,329,
(iii) with respect to any Payment Date thereafter and prior to the Payment Date
on which the Principal Balance of the Class B Notes is reduced to zero, 100%,
(iv) with respect to the Payment Date on which the Principal Balance of the
Class B Notes is reduced to zero, that percentage of the Monthly Principal
Amount for such Payment Date which is necessary to reduce the Principal Balance
of the Class B Notes to zero, and (vi) with respect to any Payment Date after
the Payment Date on which the Principal Balance of the Class B Notes is reduced
to zero, 0%.
"NOTES" means the Class A Notes and the Class B Notes.
"N.Y. UCC" means the UCC as in effect in the State of New York from
time to time.
"OFFICER'S CERTIFICATE" means a certificate signed by any Authorized
Officer of the Issuer, under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.01, and delivered to
the Trustee. Unless otherwise specified, any reference in this Indenture to an
Officer's Certificate shall be to an Officer's Certificate of any Authorized
Officer of the Issuer.
"OPINION OF COUNSEL" means one or more written opinions of counsel who
may, except as otherwise expressly provided in this Indenture, be employees of
or counsel to the Issuer or the Servicer and which shall comply with any
applicable requirements of Section 11.01.
"ORIGINAL EQUITY CERTIFICATE BALANCE" means $127,509,329.
"ORIGINAL PRINCIPAL BALANCE" means (i) with respect to the Class A-1
Notes, $1,125,000,000, (ii) with respect to the Class A-2 Notes, $695,000,000,
(ii) with respect to the Class A-3 Notes, $659,000,000, (iv) with respect to the
Class A-4 Notes, $400,220,000, and (v) with respect to the Class B Notes,
$178,500,000.
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"OUTSTANDING" means, as of the date of determination, all Notes
theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore canceled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent in trust for the Holders of such Notes (provided, however,
that if such Notes are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor, satisfactory
to the Trustee, has been made); and
(iii) Notes in exchange for or in lieu of other Notes which have
been authenticated and delivered pursuant to this Indenture unless proof
satisfactory to the Trustee is presented that any such Notes are held by a
bona fide purchaser;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
Outstanding Amount of the Notes have given any request, demand, authorization,
direction, notice, consent or waiver hereunder or under any Related Document,
Notes owned by the Issuer, any other obligor upon the Notes, the Depositor or
any Affiliate of any of the foregoing Persons shall be disregarded and deemed
not to be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Notes that the Trustee knows to be so owned
shall be so disregarded. Notes so owned that have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to the satisfaction of
the Trustee the pledgee's right so to act with respect to such Notes and that
the pledgee is not the Issuer, any other obligor upon the Notes, the Depositor
or any Affiliate of any of the foregoing Persons.
"OUTSTANDING AMOUNT" means the Aggregate Principal Balance of the
Notes, or the Principal Balance of a Class of Notes, as applicable, Outstanding
at the date of determination.
"OWNER TRUSTEE" means The Bank of New York, not in its individual
capacity but solely as Owner Trustee under the Trust Agreement, or any successor
trustee under the Trust Agreement.
"PAYING AGENT" means the Trustee, the Luxembourg Paying Agent or any
other Person that meets the eligibility standards for the Trustee specified in
Section 6.11 and is authorized by the Issuer to make the distributions from the
Note Distribution Account, including payment of principal of or interest on the
Notes on behalf of the Issuer.
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"PAYMENT DATE" means the fifteenth day of each calendar month (or, if
such fifteenth day is not a Business Day, the next succeeding Business Day),
commencing November 15, 1996.
"PERSON" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust (including any beneficiary
thereof), unincorporated organization or government or any agency or political
subdivision thereof.
"PLEDGED REVENUES" means (i) all Scheduled Payments on the Contracts
received on or after the Cut-Off Date (including all Scheduled Payments due
prior to, but not received as of, the Cut-Off Date, but excluding any Scheduled
Payments due on or after, but received prior to, the Cut-Off Date); (ii) any
Prepayments received on the Contracts on or after the Cut-Off Date (other than,
in the case of a Lease Contract, any portion thereof allocated to the
Depositor); (iii) the Purchase Amount of any Contracts purchased by TCC in
accordance with Section 2.6 of the Transfer and Servicing Agreement (other than
any portion thereof attributable to the Book Value of the Leased Equipment);
(iv) the amount paid by the Depositor to purchase the Contracts pursuant to
Section 5.1 of the Transfer and Servicing Agreement; (v) that portion of the
Liquidation Proceeds received in respect of any Contracts and the related
Equipment on or after the Cut-Off Date and allocated to the Issuer; (vi) that
portion of any Extension Fees received on or after the Cut-Off Date and
allocated to the Issuer; and (vii) any earnings on the investment of amounts
credited to the Collection Account and the Note Distribution Account.
"PREPAYMENT" means, with respect to any Collection Period for any
Contract, a voluntary prepayment during such Collection Period of amounts due
and owing under such Contract; PROVIDED that, in the case of any Lease Contract,
the amount, if any, by which any such Prepayment exceeds the Required Payoff
Amount for such Contract shall be allocated to the Depositor in respect of the
related Leased Equipment.
"PREDECESSOR NOTE" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.05 in lieu of a mutilated, lost,
destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.
"PRINCIPAL BALANCE" means, as of any date, when used with respect to a
Class of Notes, the Original Principal Balance of such Class, less all
distributions previously made to such Class in respect of principal.
"PRINCIPAL DEFICIENCY AMOUNT" means, with respect to any Payment Date,
the lesser of (a) the Current Realized Losses for the related Collection Period
or (b) the excess, if any, of (i) the Aggregate Principal Balance of the Notes
plus the Equity
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Certificate Balance (after giving effect to all distributions of principal from
Available Pledged Revenues on such Payment Date), over (ii) the aggregate of the
Required Payoff Amounts for all Contracts as of the last day of the related
Collection Period.
"PROCEEDING" means any suit in equity, action at law or other judicial
or administrative proceeding.
"PURCHASE AGREEMENT" means the Purchase and Sale Agreement, dated as
of October 1, 1996, among TCC, the Originators and the Depositor.
"PURCHASE AMOUNT" means, with respect to a Contract and related
Equipment required to be purchased by TCC in accordance with Section 2.6 of the
Transfer and Servicing Agreement, the sum of (i) the Required Payoff Amount for
such Contract as of the Accounting Date on which such obligation to so purchase
arises, plus (ii) in the case of a Lease Contract, the Book Value of the related
Leased Equipment (that portion of the Purchase Amount attributable to such Book
Value to be allocated to the Depositor).
"PURCHASED CONTRACT" means, as of any Deposit Date, any Contract which
TCC has purchased as of the related Accounting Date, as required by Section 2.6
of the Transfer and Servicing Agreement, and as to which, on or before such
Deposit Date, (i) that portion of the Purchase Amount relating to the Required
Payoff Amount for such Contract has been deposited in the Collection Account,
and (ii) that portion, if any, of the Purchase Amount relating to the Book Value
of the related Leased Equipment has been distributed to the Depositor.
"RATING AGENCY" means each of Moody's, S&P, Fitch and Duff & Phelps,
so long as such Persons maintain a rating on the Notes or the Equity
Certificates; and, if none of Moody's, S&P, Fitch or Duff & Phelps maintains a
rating on the Notes or the Equity Certificates, such other nationally recognized
statistical rating organization, if any, selected by the Depositor.
"RATING AGENCY CONDITION" means, with respect to any action, that each
Rating Agency shall have been given 10 days' prior notice thereof and that each
of the Rating Agencies shall have notified the Issuer, the Servicer, the
Trustee, and the Depositor in writing that such action will not result in a
reduction, qualification or withdrawal of the then-current rating of the Notes
or the Equity Certificates.
"RECORD DATE" means, with respect to a Payment Date or Redemption
Date, the close of business on the last Business Day immediately preceding such
Payment Date or Redemption Date (so long as the Notes are Book-Entry Notes), or
the last day of the prior calendar month (if Definitive Notes have been issued).
"REDEMPTION DATE" means, in the case of a redemption of the Notes
pursuant to Section 10.01(a) or a payment to Noteholders pursuant to Section
10.01(b),
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the Payment Date specified by the Servicer or the Issuer pursuant to Section
10.01(a) or 10.01(b), as applicable.
"REDEMPTION PRICE" means (a) in the case of a redemption of the Notes
pursuant to Section 10.01(a), an amount equal to the principal amount of the
Notes redeemed plus accrued and unpaid interest on the principal amount of each
Class of Notes at the respective Interest Rate for each such Class of Notes
being so redeemed to but excluding the Redemption Date, or (b) in the case of a
payment made to Noteholders pursuant to Section 10.01(b), the amount on deposit
in the Note Distribution Account, but not in excess of the amount specified in
clause (a) above.
"REGISTERED HOLDER" means the Person in whose name a Note is
registered on the Note Register on the applicable Record Date.
"RELATED COLLECTION PERIOD PLEDGED REVENUES" means, with respect to
any Payment Date, the amount of Pledged Revenues in the Collection Account which
were received by the Servicer during the related Collection Period, including
all Liquidation Proceeds so received but excluding any Purchase Amounts.
"RELATED DOCUMENTS" means the Trust Agreement, the Notes, the Equity
Certificates, the Transfer and Servicing Agreement, the Purchase Agreement, the
Cash Collateral Account Agreement, the Depository Agreements and the
underwriting agreements between the Depositor and the underwriters of the Notes.
The Related Documents executed by any party are referred to herein as "such
party's Related Documents," "its Related Documents" or by a similar expression.
"REQUIRED PAYOFF AMOUNT" means, with respect to any Collection Period
for any Contract, the sum of (i) the Scheduled Payment due in such Collection
Period, together with any Scheduled Payments due in prior Collection Periods but
not yet received, plus (ii) the Contract Principal Balance of such Contract
(after taking into account the Scheduled Payment due in such Collection Period,
whether or not received).
"REQUISITE CASH COLLATERAL AMOUNT" means, (i) with respect to any
Payment Date on or prior to the Payment Date occurring in October, 1997, an
amount equal to $207,040,000, and (ii) with respect to any Payment Date
thereafter, an amount equal to the greater of (a) the sum of (1) 8.0% of the
Contract Pool Principal Balance for such Payment Date, plus (2) the excess, if
any, of (A) the sum of the Aggregate Principal Balance of the Notes and the
Equity Certificate Balance after giving effect to any payment of principal in
respect thereof on such Payment Date, over (B) the Contract Pool Principal
Balance for such Payment Date, and (b) $63,704,600; PROVIDED that in no event
will the Requisite Cash Collateral Amount exceed the sum of the Aggregate
Principal Balance of the Notes and the Equity Certificate Balance.
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"RESPONSIBLE OFFICER" means, with respect to the Trustee, any officer
of the Trustee assigned by the Trustee to administer its corporate trust affairs
relating to the Trust Estate.
"REVOLVING TRUST TRUSTEE" means The First National Bank of Chicago,
not in its individual capacity but solely as trustee for the Capita Revolving
Trust 1996-1.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc., or any successor thereto.
"SCHEDULE OF CONTRACTS" means, collectively, the schedules of Lease
Contracts and Loan Contracts (which shall be made available to the parties to
the Transfer and Servicing Agreement on a computer disk or other data storage
medium) attached to the Transfer and Servicing Agreement as (or described in)
Exhibit A-1 and Exhibit A-2, respectively.
"SCHEDULED PAYMENT" means, with respect to any Collection Period for
any Contract during the Original Term of such Contract, the scheduled payment or
payments due under such Contract in such Collection Period other than those
portions of such payments which, under such Contract, are to be (i) applied by
the Servicer to the payment of insurance charges, maintenance, taxes and other
similar obligations, or (ii) retained by the Servicer in payment of
Administrative Fees.
"SECURED OBLIGATIONS" means all amounts and obligations which the
Issuer may at any time owe to or on behalf of the Trustee for the benefit of the
Noteholders under this Indenture.
"SERVICING ACCOUNT" means the Eligible Account or Accounts established
and maintained pursuant to Section 8.05.
"STATE" means any one of the 50 states of the United States of America
or the District of Columbia.
"STATED MATURITY DATE" means, with respect to (i) each Class of Notes,
the Class A-1 Stated Maturity Date, the Class A-2 Stated Maturity Date, the
Class A-3 Stated Maturity Date, the Class A-4 Stated Maturity Date and the Class
B Stated Maturity Date, as appropriate, and (ii) the Equity Certificates, the
Equity Certificate Stated Maturity Date.
"TCC" means AT&T Capital Corporation, a Delaware corporation.
"TERMINATION DATE" means the date on which the Trustee shall have
received payment and performance of all Secured Obligations and the obligations
of the Trustee to the Holders of Equity Certificates hereunder and to the Cash
Collateral Account Lenders and the Depositor under the Cash Collateral Account
Agreement shall
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have been satisfied, or such earlier date on which the Issuer is terminated in
accordance with the Trust Agreement.
"TRANSFER AND SERVICING AGREEMENT" means the Transfer and Servicing
Agreement, dated as of October 1, 1996, among the Depositor, the Servicer, the
Trustee and the Issuer.
"TRUST ACCOUNTS" means the Servicing Account, the Collection Account
and the Note Distribution Account, and such other accounts as may be established
in the name of the Issuer or the Trustee pursuant to the Trust Agreement or the
Transfer and Servicing Agreement.
"TRUST AGREEMENT" means the Amended and Restated Trust Agreement,
dated as of October 1, 1996, between the Depositor and the Owner Trustee, as the
same may be amended and supplemented from time to time in accordance with the
terms thereof.
"TRUST ESTATE" means the Trust Estate as described in the Granting
Clauses hereof.
"TRUST INDENTURE ACT" OR "TIA" means the Trust Indenture Act of 1939,
as amended, as in force on the date hereof, unless otherwise specifically
provided.
"TRUSTEE" means The Chase Manhattan Bank, a New York banking
corporation, as Trustee under this Indenture, or any successor Trustee under
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.
SECTION 1.02. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
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"obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
have the meaning assigned to them by such definitions.
SECTION 1.03. RULES OF CONSTRUCTION. Unless otherwise specified:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles
as in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
(v) words in the singular include the plural and words in the
plural include the singular; and
(vi) references to Sections, Subsections, Schedules and Exhibits shall
refer to such portions of this Indenture.
Unless the context shall clearly indicate otherwise, or may otherwise
require, in this Indenture the terms "herein," "hereunder," "hereby," "hereto,"
"hereof" and any similar terms refer to this Indenture as a whole and not to any
particular article, section or subdivision hereof.
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ARTICLE II
THE NOTES
SECTION 2.01. FORM. Each Class of Class A Notes and the Class B
Notes, in each case together with the Trustee's certificate of authentication,
shall be in substantially the forms set forth in Exhibits C-1 and C-2,
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 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.
The terms of the Notes set forth in Exhibits C-1 and C-2 are part of
the terms of this Indenture.
SECTION 2.02. EXECUTION, AUTHENTICATION AND DELIVERY. The Notes
shall be executed on behalf of the Issuer by any of its Authorized Officers.
The signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals who
were at any time Authorized Officers of the 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.
The Trustee shall upon receipt of an Issuer Order authenticate and
deliver Class A-1 Notes for original issue in an aggregate principal amount of
$1,125,000,000, Class A-2 Notes for original issue in an aggregate principal
amount of $695,000,000, Class A-3 Notes for original issue in an aggregate
principal amount of $659,000,000, Class A-4 Notes for original issue in an
aggregate principal amount of $400,220,000 and Class B Notes in an aggregate
principal amount of $178,500,000. The aggregate principal amount of Class A-1
Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes and Class B Notes
outstanding at any time may not exceed such respective amounts except as
provided in Section 2.05.
Each Note shall be dated the date of its authentication. The Notes
shall be issuable as registered Notes in the minimum denomination of $10,000 and
in integral multiples thereof.
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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 Trustee by the manual signature of one of its authorized
signatories, and such certificate upon any Note shall be conclusive evidence,
and the only evidence, that such Note has been duly authenticated and delivered
hereunder.
SECTION 2.03. TEMPORARY NOTES. Pending the preparation of definitive
Notes, the Issuer may execute, and upon receipt of an Issuer Order the Trustee
shall authenticate and deliver, temporary Notes which are printed, lithographed,
typewritten, mimeographed or otherwise produced, of the tenor of the definitive
Notes in lieu of which they are issued and with such variations not inconsistent
with the terms of this Indenture as the officers executing such Notes may
determine, as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuer will cause definitive Notes
to be prepared without unreasonable delay. After the preparation of definitive
Notes, the temporary Notes shall be exchangeable for definitive Notes upon
surrender of the temporary Notes at the office or agency of the Issuer to be
maintained as provided in Section 3.02, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Notes, the Issuer shall
execute and the 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 definitive Notes.
SECTION 2.04. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
The Issuer shall cause to be kept a register (the "Note Register") in which,
subject to such reasonable regulations as it may prescribe, the Issuer shall
provide for the registration of Notes and the registration of transfers of
Notes. The Trustee shall be the initial "Note Registrar" for the purpose of
registering Notes and transfers of Notes as herein provided. The Issuer may
revoke the appointment of, and remove, any Note Registrar if the Issuer
determines in its sole discretion that such Note Registrar failed to perform its
obligations under this Indenture in any material respect. Any Note Registrar
shall be permitted to resign as Note Registrar upon 30 days' notice to the
Issuer and, if the Note Registrar is not the Trustee, to the Trustee; PROVIDED,
HOWEVER, that such resignation shall not be effective and such Note Registrar
shall continue to perform its duties as Note Registrar until the Issuer has
appointed a successor Note Registrar or elected to assume such duties. Upon any
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note
Registrar.
If a Person other than the Trustee is appointed by the Issuer as Note
Registrar, the Issuer will give the Trustee prompt written notice of the
appointment of such Note Registrar and of the location, and any change in the
location, of the Note Register, and the Trustee shall have the right to inspect
the Note Register at all
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reasonable times and to obtain copies thereof, and the Trustee shall have the
right to rely upon a certificate executed on behalf of the Note Registrar by an
Executive Officer thereof as to the names and addresses of the Holders of the
Notes and the principal amounts and number of such Notes.
Upon surrender for registration of transfer of any Note at the office
or agency of the Issuer to be maintained as provided in Section 3.02, the Issuer
shall execute, and the Trustee shall authenticate and the Noteholder shall
obtain from the Trustee, in the name of the designated transferee or
transferees, one or more new Notes of the same Class in any authorized
denominations, of a like aggregate principal amount.
At the option of the Holder, Notes may be exchanged for other Notes in
any authorized denominations, of a like aggregate principal amount, upon
surrender of the Notes to be exchanged at such office or agency. Whenever any
Notes are so surrendered for exchange, the Issuer shall execute, and the Trustee
shall authenticate and the Noteholder shall obtain from the Trustee, the Notes
which the Noteholder making the exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed by, or be accompanied by a written instrument of
transfer in form satisfactory to the Trustee duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing, with such
signature guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in a "signature guarantee program" determined by the Note
Registrar in accordance with the Exchange Act, and such other documents as the
Trustee may require.
No service charge shall be made to a Holder for any registration of
transfer or exchange of Notes, but the Issuer or the Trustee may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of Notes,
other than exchanges pursuant to Section 2.03 or 9.06 not involving any
transfer.
The preceding provisions of this Section notwithstanding, the Issuer
shall not be required to make and the Note Registrar need not register transfers
or exchanges of Notes selected for redemption or of any Note for a period of 15
days preceding the due date for any payment with respect to the Note.
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SECTION 2.05. MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (i) any
mutilated Note is surrendered to the Trustee, or the Trustee receives evidence
to its satisfaction of the destruction, loss or theft of any Note, and (ii)
there is delivered to the Trustee such security or indemnity as may be required
by the Trustee to hold the Issuer and the Trustee harmless, then, in the absence
of notice to the Issuer, the Note Registrar or the Trustee that such Note has
been acquired by a bona fide purchaser, the Issuer shall execute and upon its
request the Trustee shall authenticate and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Note, a replacement Note;
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 Trustee shall be entitled to recover such
replacement Note (or such payment) from the Person to whom it was delivered or
any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or indemnity
provided therefor to the extent of any loss, damage, cost or expense incurred by
the Issuer or the Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the
Issuer or the Trustee may require the payment by the Holder of such Note of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other reasonable expenses (including the fees and
expenses of the Trustee or the Note Registrar) connected therewith.
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.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.06. PERSON DEEMED OWNER. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Trustee and any agent of
the Issuer or the 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,
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whether or not such Note be overdue, and none of the Issuer, the Trustee nor any
agent of the Issuer or the Trustee shall be affected by notice to the contrary.
SECTION 2.07. PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED INTEREST.
(a) The Notes shall accrue interest as provided in the forms of the
Class A Notes and the Class B Note set forth in Exhibits C-1 and C-2,
respectively, and such interest shall be payable on each Payment Date as
specified therein, subject to Section 3.01. Any installment of interest or
principal, if any, payable on any Note which is punctually paid or duly provided
for by the Issuer on the applicable Payment Date shall be paid to the Person in
whose name such Note (or one or more Predecessor Notes) is registered on the
Record Date, by check mailed first-class, postage prepaid to such Person's
address as it appears on the Note Register on such Record Date, except that,
unless Definitive Notes have been issued pursuant to Section 2.11, with respect
to Notes registered on the Record Date in the name of the nominee of the
Depository, payment will be made by wire transfer in immediately available funds
to the account designated by such nominee and except for the final installment
of principal payable with respect to such Note on a Payment Date, which shall be
payable as provided below. The funds represented by any such checks returned
undelivered shall be held in accordance with Section 3.03.
(b) The principal of each Note shall be payable in installments on
each Payment Date as provided in the forms of the Class A Notes and the Class B
Note set forth in Exhibits C-1 and C-2, respectively. Notwithstanding the
foregoing, the entire unpaid principal amount of the Notes shall be due and
payable, if not previously paid, on the date on which an Event of Default shall
have occurred and be continuing and the Trustee or a Note Majority have declared
the Notes to be immediately due and payable in the manner provided in Section
5.02. All principal payments on a class of Notes shall be made pro rata to the
Noteholders of such Class entitled thereto. The 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. Notices in
connection with redemptions of Notes shall be mailed to Noteholders as provided
in Section 10.02.
SECTION 2.08. CANCELLATION. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and shall be promptly
canceled by the Trustee. The Issuer may at any time deliver to the Trustee for
cancellation any Notes previously authenticated and delivered hereunder which
the Issuer may have acquired in any manner whatsoever, and all Notes so
delivered shall be promptly canceled by the Trustee. No Notes shall be
authenticated in lieu of or in exchange for
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any Notes canceled as provided in this Section, except as expressly permitted by
this Indenture. All canceled Notes may be held or disposed of by the Trustee in
accordance with its standard retention or disposal policy as in effect at the
time unless the Issuer shall direct by an Issuer Order that they be destroyed or
returned to it, provided that such Issuer Order is timely and the Notes have not
been previously disposed of by the Trustee.
SECTION 2.09. BOOK-ENTRY NOTES. The Notes, upon original issuance,
will be issued in the form of a typewritten Note or Notes representing the
Book-Entry Notes, to be delivered to The Depository Trust Company, the initial
Depository, by, or on behalf of, the Issuer. Each such Note shall initially be
registered on the Note Register in the name of Cede & Co., the nominee of the
initial Depository, and no Note Owner will receive a Definitive Note
representing such Note Owner's interest in such Note, except as provided in
Section 2.11. Unless and until Definitive Notes have been issued to Note Owners
pursuant to Section 2.11:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Note Registrar and the Trustee shall be entitled to deal
with the Depository for all purposes of this Indenture (including the
payment of principal of and interest on the Notes and the giving of
instructions or directions hereunder) as the sole holder of the Notes, and
shall have no obligation to the Note Owners;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Indenture, the provisions of this Section
shall control;
(iv) the rights of Note Owners shall be exercised only through
the Depository and shall be limited to those established by law and
agreements between such Note Owners and the Depository and/or the
Depository Participants. Pursuant to the Depository Agreement, unless and
until Definitive Notes are issued pursuant to Section 2.11, the initial
Depository will make book-entry transfers among the Depository Participants
and receive and transmit payments of principal of and interest on the Notes
to such Depository Participants; and
(v) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes evidencing
a specified percentage of the Outstanding Amount of the Notes, the
Depository shall be deemed to represent such percentage only to the extent
that it has received instructions to such effect from Note Owners and/or
Depository Participants owning or representing, respectively, such required
percentage of the beneficial interest in the Notes and has delivered such
instructions to the Trustee.
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SECTION 2.10. NOTICES TO DEPOSITORY. Whenever a notice or other
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to Note Owners pursuant to Section
2.11, the Trustee shall give all such notices and communications specified
herein to be given to Holders of the Notes to the Depository and shall have no
obligation to the Note Owners.
SECTION 2.11. DEFINITIVE NOTES. If (i) the Depositor advises the
Trustee in writing that the Depository is no longer willing or able properly to
discharge its responsibilities with respect to the Notes, and the Depositor is
unable to locate a qualified successor, (ii) the Depositor at its option advises
the Trustee in writing that it elects to terminate the book-entry system through
the Depository or (iii) after the occurrence of an Event of Default, a Note
Majority advises the Trustee and the Depository in writing that the continuation
of a book-entry system through the Depository is no longer in the best interests
of the Note Owners, then the Depository shall notify all Note Owners and the
Trustee of the occurrence of any such event and of the availability of
Definitive Notes to Note Owners requesting the same. Upon surrender to the
Trustee of the Note or Notes representing the Book-Entry Notes by the
Depository, accompanied by registration instructions, the Issuer shall execute
and the Trustee shall authenticate the Definitive Notes in accordance with the
instructions of the Depository. None of the Issuer, the Note Registrar or the
Trustee shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Notes, all references herein to obligations
imposed upon or to be performed by the Depository shall be deemed to be imposed
upon and performed by the Trustee or a Paying Agent (if other than the Trustee),
to the extent applicable with respect to such Definitive Notes, and the Trustee
shall recognize the Holders of the Definitive Notes as Noteholders.
SECTION 2.12. CALCULATIONS. All calculations of the amount of
interest accrued on the Equity Certificates and the Notes and all calculations
of the amount of the Servicing Fee shall be made on the basis of a 360-day year
consisting of twelve 30-day months.
SECTION 2.13. DEPOSIT OF SERIES 1996-1 NOTE PROCEEDS. From the
proceeds derived from the sale of the Notes, including any accrued interest paid
as part of the purchase price thereof, there shall be deposited with the
Trustee:
(1) for credit to the Note Distribution Account, an amount equal to
any accrued interest on the Notes paid as part of the purchase price
thereof; and
(2) for credit to the Cash Collateral Account, as the initial deposit
required to be made by the Depositor in accordance with the Cash Collateral
Account Agreement, an amount equal to $95,558,000.
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The balance of the proceeds of the Notes shall be paid to or upon the order of
the Depositor.
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ARTICLE III
COVENANTS
SECTION 3.01. PAYMENT OF PRINCIPAL AND INTEREST. The Issuer will
duly and punctually pay the principal and interest on the Notes in accordance
with the terms of the Notes and this Indenture. Without limiting the foregoing,
the Issuer will cause to be distributed all amounts on deposit in the Note
Distribution Account on a Payment Date in accordance with Section 8.04(b).
Amounts properly withheld under the Code by any Person from a payment to any
Noteholder of interest and/or principal shall be considered as having been paid
by the Issuer to such Noteholder for all purposes of this Indenture.
SECTION 3.02. MAINTENANCE OF OFFICE OR AGENCY. The Issuer will
maintain in the Borough of Manhattan, City of New York, an office or agency
where Notes may be surrendered for registration of transfer or exchange, and
where notices and demands to or upon the Issuer in respect of the Notes and this
Indenture may be served. The Issuer hereby initially appoints the Trustee to
serve as its agent for the foregoing purposes. In the event Definitive Notes
are issued pursuant to Section 2.11, the Issuer will also maintain in Luxembourg
an office or agency where Notes may be surrendered for registration of transfer
or exchange. The Issuer hereby appoints the Luxembourg Paying Agent to serve as
its agent for such purposes. The Issuer will give prompt written notice to the
Trustee of the location, and of any change in the location, of any such office
or agency. If at any time the Issuer shall fail to maintain any such office or
agency or shall fail to furnish the Trustee with the address thereof, such
surrenders, notices and demands may be made or served at the Corporate Trust
Office, and the Issuer hereby appoints the Trustee as its agent to receive all
such surrenders, notices and demands.
SECTION 3.03. MONEY FOR PAYMENTS TO BE HELD IN TRUST. As provided in
Section 8.04, 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 8.04(b) shall be made on behalf of the Issuer by the Trustee
or by another Paying Agent, and no amounts so withdrawn from the Note
Distribution Account for payments of Notes shall be paid over to the Issuer.
On or before the Business Day preceding each Payment Date and
Redemption Date, the Issuer shall deposit or cause to be deposited in the Note
Distribution Account an aggregate sum sufficient to pay the amounts then
becoming due, such sum to be held in trust for the benefit of the Persons
entitled thereto and (unless the Paying Agent is the Trustee) shall promptly
notify the Trustee of its action or failure so to act.
The Issuer will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with
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the Trustee (and if the Trustee acts as Paying Agent, it hereby so agrees),
subject to the provisions of this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and pay such sums to such Persons as herein provided;
(ii) give the Trustee notice of any default (of which it has
actual knowledge) by the Issuer (or any other obligor upon the Notes) in
the making of any payment required to be made with respect to the Notes;
(iii) at any time during the continuance of any such default, upon
the written request of the Trustee, forthwith pay to the Trustee all sums
so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay to
the Trustee all sums held by it in trust for the payment of Notes if at any
time it ceases to meet the standards required to be met by a Paying Agent
at the time of its appointment; and
(v) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable
reporting requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Trustee all sums held in trust by
such Paying Agent, such sums to be held by the 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 Trustee, such Paying Agent shall be released from all
further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds, any money
held by the 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 upon
Issuer Request shall be deposited by the Trustee in the Collection Account; and
the Holder of such Note shall thereafter, as an unsecured general creditor, look
only to the Issuer for payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money shall thereupon cease; PROVIDED,
HOWEVER, that the Trustee or such Paying Agent, before being required to make
any such repayment, may at the expense 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
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City of New York, notice that such money remains unclaimed and that, after a
date specified therein, which shall not be less than 30 days from the date of
such publication, any unclaimed balance of such money then remaining will be
repaid to or for the account of the Issuer. The Trustee may also adopt and
employ, at the expense of the Issuer, any other reasonable means of notification
of such repayment (including, but not limited to, mailing notice of such
repayment to Holders whose Notes have been called but have not been surrendered
for redemption or whose right to or interest in moneys due and payable but not
claimed is determinable from the records of the Trustee or of any Paying Agent,
at the last address of record for each such Holder).
SECTION 3.04. EXISTENCE. The Issuer will keep in full effect its
existence, rights and franchises as a trust under the laws of the State of New
York (unless it becomes, or any successor Issuer hereunder is or becomes,
organized under the laws of any other state or of the United States of America,
in which case the Issuer will keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and will obtain and
preserve its qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Contracts and each other
instrument or agreement included in the Trust Estate.
SECTION 3.05. PROTECTION OF TRUST ESTATE. The Issuer intends the
security interest Granted pursuant to this Indenture in favor of the Trustee to
be prior to all other liens in respect of the Trust Estate, and the Issuer shall
take all actions necessary to obtain and maintain, in favor of the Trustee, for
the benefit of the Noteholders, a first lien on and a first priority, perfected
security interest in the Trust Estate. The Issuer will from time to time
execute and deliver all such supplements and amendments hereto and all such
financing statements, continuation statements, instruments of further assurance
and other instruments, all as prepared by the Servicer and delivered to the
Issuer, and will take such other action necessary or advisable to:
(i) grant more effectively all or any portion of the Trust
Estate;
(ii) maintain or preserve the lien and security interest (and the
priority thereof) in favor of the Trustee for the benefit of the Trustee
created by this Indenture or carry out more effectively the purposes
hereof;
(iii) perfect, publish notice of or protect the validity of any
Grant made or to be made by this Indenture;
(iv) enforce any of the Contracts and each other instrument or
agreement included in the Trust Estate;
(v) preserve and defend title to the Trust Estate and the rights
of the Trustee in such Trust Estate against the claims of all persons and
parties; or
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(vi) pay all taxes or assessments levied or assessed upon the
Trust Estate when due.
The Issuer hereby designates the Trustee its agent and attorney-in-fact to
execute any financing statement, continuation statement or other instrument
required by the Trustee pursuant to this Section.
SECTION 3.06. OPINIONS AS TO TRUST ESTATE.
(a) On the Closing Date, the Issuer shall furnish to the Trustee an
Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording and filing of this
Indenture, 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 first priority lien and security interest in favor of the Trustee,
for the benefit of the Trustee, 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 and security interest effective.
(b) On or before April 30 in each calendar year, beginning in 1997,
the Issuer shall furnish to the Trustee an Opinion of Counsel with respect to
each jurisdiction in which the Contracts are located or a Uniform Commercial
Code financing statement has been filed by the Servicer 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 first priority lien and security interest 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 maintain such lien and
security interest. Such Opinion of Counsel shall also describe the recording,
filing, re-recording and refiling of this Indenture, any indentures supplemental
hereto and any other requisite documents and the execution and filing of any
financing statements and continuation statements that will, in the opinion of
such counsel, be required to maintain the lien and security interest of this
Indenture until April 30 in the following calendar year.
SECTION 3.07. PERFORMANCE OF OBLIGATIONS; SERVICING OF CONTRACTS.
(a) The Issuer will not take any action and will use its best efforts
not to permit any action to be taken by others that would release any Person
from any of such Person's material covenants or obligations under any instrument
or agreement included in the Trust Estate or that would result in the amendment,
hypothecation, subordination, termination or discharge of, or impair the
validity or effectiveness of, any such instrument or agreement, except as
expressly provided in this Indenture, the Transfer and Servicing Agreement or
such other instrument or agreement.
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(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Trustee in an Officer's Certificate of the Issuer
shall be deemed to be action taken by the Issuer. Initially, the Issuer has
contracted with the Servicer to assist the Issuer in performing its duties under
this Indenture. The Owner Trustee shall not be responsible for the action or
inaction of the Servicer.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Related Documents
and in the instruments and agreements included in the Trust Estate, including
but not limited to filing or causing to be filed all UCC financing statements
and continuation statements required to be filed by the terms of this Indenture
and the Transfer and Servicing Agreement in accordance with and within the time
periods provided for herein and therein. Except as expressly provided herein,
the Issuer shall not waive, amend, modify, supplement or terminate any of its
Related Documents or any provision thereof without the consent of the Trustee or
a Note Majority.
(d) If the Issuer shall have knowledge of the occurrence of a
Servicer Termination Event under the Transfer and Servicing Agreement, the
Issuer shall promptly notify the Trustee and the Rating Agencies thereof, and
shall specify in such notice the action, if any, the Issuer is taking with
respect of such default. If a Servicer Termination Event shall arise from the
failure of the Servicer to perform any of its duties or obligations under the
Transfer and Servicing Agreement with respect to the Contracts, the Issuer shall
take all reasonable steps available to it to remedy such failure.
(e) If the Issuer has given notice of termination to the Servicer of
the Servicer's rights and powers pursuant to Section 8.2 of the Transfer and
Servicing Agreement, as promptly as possible thereafter, the Issuer shall
appoint a successor servicer in accordance with Section 8.3 of the Transfer and
Servicing Agreement.
(f) Upon any termination of the Servicer's rights and powers pursuant
to the Transfer and Servicing Agreement, the Issuer shall promptly notify the
Trustee. As soon as a successor Servicer is appointed, the Issuer shall notify
the Trustee of such appointment, specifying in such notice the name and address
of such successor Servicer.
(g) The Issuer agrees that it will not waive timely performance or
observance by the Servicer or the Depositor of their respective duties under the
Related Documents if the effect thereof would adversely affect the Holders of
the Notes.
SECTION 3.08. NEGATIVE COVENANTS. Until the Termination Date, the
Issuer shall not:
(i) except as expressly permitted by this Indenture or the Trust
Agreement, sell, transfer, exchange or otherwise dispose of any of the
properties
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or assets of the Issuer, including those included in the Trust Estate,
unless directed to do so by the Trustee;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than amounts
properly withheld from such payments under the Code or applicable state
law) or assert any claim against any present or former Noteholder by reason
of the payment of the taxes levied or assessed upon any part of the Trust
Estate;
(iii) dissolve or liquidate in whole or in part;
(iv) permit the validity or effectiveness of this Indenture to be
impaired, or permit the lien in favor of the Trustee created by this
Indenture to be amended, hypothecated, subordinated, terminated or
discharged, or permit any Person to be released from any covenants or
obligations with respect to the Notes under this Indenture except as may be
expressly permitted hereby;
(v) permit any lien, charge, excise, claim, security interest,
mortgage or other encumbrance (other than the lien in favor of the Trustee
created by this Indenture) to be created on or extend to or otherwise arise
upon or burden the Trust Estate or any part thereof or any interest therein
or the proceeds thereof (other than tax liens, mechanics' liens and other
liens that arise by operation of law, in each case on the Equipment and
arising solely as a result of an action or omission of the related
Obligor);
(vi) permit the lien in favor of the Trustee created by this
Indenture not to constitute a valid first priority (other than with respect
to any such tax, mechanics' or other lien described in clause (v) above)
security interest in the Trust Estate; or
(vii) amend, modify or fail to comply with the provisions of the
Related Documents without the prior written consent of the Trustee.
SECTION 3.09. ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer will
deliver to the Trustee, within 120 days after the end of each fiscal year of the
Issuer (commencing with the fiscal year ended December 31, 1996), an Officer's
Certificate stating, as to the Authorized Officer signing such Officer's
Certificate, that
(i) a review of the activities of the Issuer during such year
and of performance under this Indenture has been made under such Authorized
Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, based on
such review, the Issuer has complied with all conditions and covenants
under this Indenture throughout such year, or, if there has been a default
in the compliance
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of any such condition or covenant, specifying each such default known to
such Authorized Officer and the nature and status thereof.
SECTION 3.10. ISSUER MAY CONSOLIDATE OR MERGE ONLY ON CERTAIN TERMS.
(a) The Issuer shall not consolidate or merge with or into any other
Person, unless
(i) the Person (if other than the Issuer) formed by or surviving
such consolidation or merger shall be a Person organized and existing under
the laws of the United States of America or any State and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Trustee, in form and substance satisfactory to the Trustee, the due and
punctual payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this Indenture
and each other Related Document on the part of the Issuer to be performed
or observed, all as provided herein;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel which
shall be delivered to and shall be satisfactory to the Trustee to the
effect that such transaction will not have any material adverse tax
consequence to the Trust, any Noteholder or any Equity Certificateholder;
(v) any action as is necessary to maintain the lien and security
interest created in favor of the Trustee by this Indenture shall have been
taken;
(vi) the Issuer shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel (which shall describe the actions
taken as required by clause (a)(v) of this Section or that no such actions
will be taken) each stating that such consolidation or merger and such
supplemental indenture comply with this Article III and that all conditions
precedent herein provided for relating to such transaction have been
compiled with (including any filing required by the Exchange Act); and
(vii) the Issuer or the Person (if other than the Issuer) formed
by or surviving such consolidation or merger has a net worth, immediately
after such consolidation or merger, that is (a) greater than zero and (b)
not less than the net worth of the Issuer immediately prior to giving
effect to such consolidation or merger.
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(b) The Issuer shall not convey or transfer all or substantially all
of its properties or assets, including those included in the Trust Estate, to
any Person (except as expressly permitted by the Indenture or the Transfer and
Servicing Agreement), unless
(i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer shall (A) be a United States citizen or
a Person organized and existing under the laws of the United States of
America or any State, (B) expressly assume, by an indenture supplemental
hereto, executed and delivered to the Trustee, in form and substance
satisfactory to the Trustee, the due and punctual payment of the principal
of and interest on all Notes and the performance or observance of every
agreement and covenant of this Indenture and each Related Document on the
part of the Issuer to be performed or observed, all as provided herein, (C)
expressly agree by means of such supplemental indenture that all right,
title and interest so conveyed or transferred shall be subject and
subordinate to the rights of Holders of the Notes, (D) unless otherwise
provided in such supplemental indenture, expressly agree to indemnify,
defend and hold harmless the Issuer against and from any loss, liability or
expense arising under or related to this Indenture and the Notes and (E)
expressly agree by means of such supplemental indenture that such Person
(or if a group of Persons, then one specified Person) shall make all
filings with the Commission (and any other appropriate Person) required by
the Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel which
shall be delivered to and shall be satisfactory to the Trustee to the
effect that such transaction will not have any material adverse tax
consequence to the Trust, any Noteholder or any Equity Certificateholder;
(v) any action as is necessary to maintain the lien and security
interest created in favor of the Trustee by this Indenture shall have been
taken;
(vi) the Issuer shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel (which shall describe the actions
taken as required by clause (b)(v) of this Section or that no such actions
will be taken) each stating that such conveyance or transfer and such
supplemental indenture comply with this Article III and that all conditions
precedent herein provided for relating to such transaction have been
complied with (including any filing required by the Exchange Act); and
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(vii) the Person acquiring by conveyance or transfer the
properties or assets of the Issuer has a net worth, immediately after such
conveyance or transfer, that is (a) greater than zero and (b) not less than
the net worth of the Issuer immediately prior to giving effect to such
conveyance or transfer.
SECTION 3.11. SUCCESSOR OR TRANSFEREE.
(a) Upon any consolidation or merger of the Issuer in accordance with
Section 3.10(a), the Person formed by or surviving such consolidation or merger
(if other than the Issuer) shall succeed to, and be substituted for, and may
exercise every right and power of, the Issuer under this Indenture 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 3.10(b), Capita Equipment Receivables Trust
1996-1 will be released from every covenant and agreement of this Indenture to
be observed or performed on the part of the Issuer with respect to the Notes
immediately upon the delivery of written notice to the Trustee stating that
Capita Equipment Receivables Trust 1996-1 is to be so released.
SECTION 3.12. NO OTHER BUSINESS. The Issuer shall not engage in any
business other than financing, purchasing, owning, selling and managing the
Contracts and the related Equipment in the manner contemplated by this Indenture
and the Related Documents and activities incidental thereto.
SECTION 3.13. NO BORROWING. The Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
Indebtedness except for (i) the Notes and (ii) any other Indebtedness permitted
by or arising under the Related Documents. The proceeds of the Notes shall be
used exclusively to fund the Depositor's purchase of the Contracts and the other
assets specified in the Transfer and Servicing Agreement and to pay the Issuer's
organizational, transactional and start-up expenses.
SECTION 3.14. SERVICER'S OBLIGATIONS. The Issuer shall monitor the
performance of the Servicer under the Transfer and Servicing Agreement, and
shall use its reasonable good faith efforts to cause the Servicer duly and
punctually to perform all of its duties and obligations thereunder.
SECTION 3.15. GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES.
Except as contemplated by the Transfer and Servicing Agreement or this
Indenture, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuming another's payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree
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contingently to do so) any stock, obligations, assets or securities of, any
other interest in, or make any capital contribution to, any other Person.
SECTION 3.16. INCOME TAX CHARACTERIZATION. The Depositor has
structured the Trust Agreement, this Indenture, the Cash Collateral Account
Agreement, the Notes and the Equity Certificates with the intention that the
Notes will qualify under applicable federal, state, local and foreign tax law as
indebtedness of the Depositor secured by the Contracts. The Depositor, the
Servicer, each Noteholder and each Note Owner agree to treat and to take no
action inconsistent with the treatment of the Notes as such indebtedness for
purposes of federal, state, local and foreign income or franchise taxes and any
other tax imposed on or measured by income. Each Noteholder and each Note
Owner, by acceptance of its Note or beneficial interest therein, agrees to be
bound by the provisions of this Section. Each Noteholder agrees that it will
cause any Note Owner acquiring an interest in a Note through it to comply with
this Indenture as to treatment as indebtedness under applicable tax law, as
described in this Section.
SECTION 3.17. RESTRICTED PAYMENTS. Except as expressly permitted by
this Indenture, the Trust Agreement or the Transfer and Servicing Agreement, the
Issuer shall not, directly or indirectly, (i) make any distribution (by
reduction of capital or otherwise), whether in cash, property, securities or a
combination thereof, to any owner of a beneficial interest in the Issuer or
otherwise with respect to any ownership or equity interest or security in or of
the Issuer or to the Servicer, (ii) redeem, purchase, retire or otherwise
acquire for value any such ownership or equity interest or security or (iii) set
aside or otherwise segregate any amounts for any such purpose. The Issuer will
not, directly or indirectly, make payments to or distributions from any of the
Trust Accounts except in accordance with this Indenture and the Related
Documents.
SECTION 3.18. NOTICE OF EVENTS OF DEFAULT. The Issuer agrees to give
the Trustee and the Rating Agencies prompt written notice of each Event of
Default hereunder and each default on the part of the Servicer or the Depositor
of its obligations under the Transfer and Servicing Agreement.
SECTION 3.19. FURTHER INSTRUMENTS AND ACTS. Upon request of the
Trustee, the Issuer will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 3.20. COMPLIANCE WITH LAWS. The Issuer shall comply with the
requirements of all applicable laws, the non-compliance with which would,
individually or in the aggregate, materially and adversely affect the ability of
the Issuer to perform its obligations under the Notes, this Indenture or any
Related Document.
SECTION 3.21. AMENDMENTS OF TRANSFER AND SERVICING AGREEMENT AND
TRUST AGREEMENT. The Issuer shall not agree to any amendment to Section 9.1 of
the
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Transfer and Servicing Agreement or Section 11.1 of the Trust Agreement to
eliminate the requirements thereunder that the Trustee or the Holders of the
Notes consent to amendments thereto as provided therein.
SECTION 3.22. TRUST OBLIGATION. No recourse may be taken, directly
or indirectly, with respect to the obligations of the Issuer, the Owner Trustee
or the Trustee on the Notes or under this Indenture or any certificate or other
writing delivered in connection herewith or therewith, against (i) the Trustee
or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer,
director, employee or agent of the Trustee or the Owner Trustee in its
individual capacity, any holder of a beneficial interest in the Issuer, the
Owner Trustee or the Trustee or of any successor or assign of the Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Trustee and the Owner Trustee
have no such obligations in their individual capacity) and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
For all purposes of this Indenture, in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Articles VI, VII and
VIII of the Trust Agreement.
SECTION 3.23. APPOINTMENT OF LUXEMBOURG PAYING AGENT AND LUXEMBOURG
LISTING AGENT. The Issuer hereby appoints Kredietbank S.A. Luxembourgeoise as
paying agent in Luxembourg (the "Luxembourg Paying Agent") and, so long as the
Notes are listed on the Luxembourg Stock Exchange, as listing agent in
Luxembourg (the "Luxembourg Listing Agent") with respect to the Notes. The
Issuer will cause Kredietbank S.A. Luxembourgeoise to execute and deliver to the
Trustee an instrument satisfying the requirements of Section 3.03 (in its
capacity as a Paying Agent) and in which Kredietbank S.A. Luxembourgeoise shall
also agree with the Trustee to perform all obligations under this Indenture in
its capacity as Luxembourg Paying Agent and Luxembourg Listing Agent. All fees
and expenses of the Luxembourg Paying Agent and the Luxembourg Listing Agent
shall be paid by the Servicer in accordance with the Transfer and Servicing
Agreement.
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ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.01. SATISFACTION AND DISCHARGE OF INDENTURE. This
Indenture shall cease to be of further effect with respect to the Notes except
as to (i) rights of registration of transfer and exchange, (ii) substitution of
mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to
receive payments of principal and interest thereon, (iv) Sections 3.03, 3.04,
3.05, 3.07, 3.08, 3.10, 3.12, 3.13, 3.16, 3.20 and 3.21, (v) the rights,
obligations and immunities of the Trustee hereunder (including the rights of the
Trustee under Section 6.07 and the obligations of the Trustee under Section
4.02) and (vi) the rights of Noteholders as beneficiaries hereof with respect to
the property so deposited with the Trustee payable to all or any of them, and
the Trustee, on demand of and at the expense of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with
respect to the Notes, when
(A) either
(1) all Notes theretofore authenticated and delivered (other
than (i) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.05 and (ii) Notes for
whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Issuer and thereafter repaid to
the Issuer or discharged from such trust, as provided in Section 3.03)
have been delivered to the Trustee for cancellation; or
(2) all Notes not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity Date within one year, or
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name, and at the
expense, of the Issuer,
and the Issuer, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be irrevocably deposited with the
Trustee as part of the Trust Estate cash or direct obligations of or
obligations guaranteed by the United States of America (which will
mature prior to the date such amounts are payable), in trust in an
Eligible Account in the name of the Trustee for such purpose, in an
amount sufficient to pay and discharge the
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entire indebtedness on such Notes not theretofore delivered to the
Trustee for cancellation when due to their Stated Maturity Date or
Redemption Date (if Notes shall have been called for redemption
pursuant to Section 10.01(a)), as the case may be;
(B) the Issuer has paid or caused to be paid all Secured Obligations;
and
(C) the Issuer has delivered to the Trustee an Officer's Certificate,
an Opinion of Counsel and (if required by the TIA or the Trustee) an
Independent Certificate from a firm of certified public accountants, each
meeting the applicable requirements of Section 11.01(a) and each stating
that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with and
the Rating Agency Condition has been satisfied.
Notwithstanding the satisfaction and discharge of this Indenture with
respect to the Notes, the obligations of the Trustee to the Holders of Equity
Certificates hereunder and to the Cash Collateral Account Lenders and the
Depositor under the Cash Collateral Account Agreement shall survive until the
payment in full of the Equity Certificates and the payment of all amounts due
and owing to the Cash Collateral Account Lenders and the Depositor under the
Cash Collateral Account Agreement or the termination of the Issuer in accordance
with the Trust Agreement.
SECTION 4.02. APPLICATION OF TRUST MONEY. All moneys deposited with
the Trustee pursuant to Section 4.01 shall be held in trust and applied by it,
in accordance with the provisions of the Notes and this Indenture, to the
payment, either directly or through any Paying Agent, as the Trustee may
determine, to the Holders of the particular Notes for the payment or redemption
of which such moneys have been deposited with the Trustee, of all sums due and
to become due thereon for principal and interest; but such moneys need not be
segregated from other funds except to the extent required herein or in the
Transfer and Servicing Agreement or required by law.
SECTION 4.03. REPAYMENT OF MONEYS HELD BY PAYING AGENT. In
connection with the satisfaction and discharge of this Indenture with respect to
the Notes, all moneys then held by any Paying Agent other than the Trustee under
the provisions of this Indenture with respect to such Notes shall, upon demand
of the Issuer, be paid to the Trustee to be held and applied according to
Section 3.03 and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.
SECTION 4.04. RELEASE OF TRUST ESTATE. The Trustee shall, on or
after the Termination Date, release any remaining portion of the Trust Estate
from the lien created by this Indenture and deposit in the Collection Account
any funds then on deposit in any other Trust Account. The Trustee shall release
property from the lien
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created by this Indenture pursuant to this Section only upon receipt of an
Issuer Request accompanied by an Officer's Certificate, an Opinion of Counsel
and (if required by the TIA) Independent Certificates in accordance with TIA
Sections 314(c) and 314(d)(1) meeting the applicable requirements of Section
11.01.
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ARTICLE V
REMEDIES
SECTION 5.01. 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; or
(ii) default in the payment of the principal of any Note on the
Redemption Date or Stated Maturity Date applicable thereto; or
(iii) default in the observance or performance in any material
respect 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 after there shall
have been given, by registered or certified mail, to the Issuer by the
Trustee or to the Issuer and the Trustee by the Holders of at least 25% of
the Outstanding Amount 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) the commencement of an involuntary case against the Issuer
or the Depositor under any applicable Federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, and such case
is not dismissed within 60 days; or
(v) (A) the commencement by the Issuer or the Depositor of a
voluntary case under any applicable Federal or state bankruptcy, insolvency
or other similar law now or hereafter in effect, (B) the entry of an order
for relief in an involuntary case against the Issuer or the Depositor under
any such law, (C) the consent by the Issuer or the Depositor to the entry
of any such order for relief, (D) the consent by the Issuer or the
Depositor to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or
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similar official of the Issuer or the Depositor or for any substantial part
of the Trust Estate, (E) the making by the Issuer or the Depositor of any
general assignment for the benefit of creditors, (F) the failure by the
Issuer or the Depositor generally to pay its debts as such debts become
due, (G) the liquidation of the Issuer or the Depositor, or (H) the taking
of action by the Issuer or the Depositor, as applicable, in furtherance of
any of the foregoing.
The Issuer shall deliver to the Trustee, within five days after
obtaining knowledge of the occurrence thereof, written notice in the form of an
Officer's Certificate of any event which with the giving of notice and the lapse
of time would become an Event of Default under clause (iii) or (iv), its status
and what action the Issuer is taking or proposes to take with respect thereto.
SECTION 5.02. RIGHTS UPON EVENT OF DEFAULT.
If an Event of Default shall have occurred and be continuing, a Note
Majority or the Trustee may, upon prior written notice to the Rating Agencies,
declare by written notice to the Issuer that the Notes become, whereupon they
shall become, immediately due and payable at par, together with accrued interest
thereon. Notwithstanding anything to the contrary in this Section, if an Event
of Default specified in Section 5.01(iv) or (v) shall occur and be continuing,
the Notes shall become immediately due and payable at par, together with accrued
interest thereon. If an Event of Default shall have occurred and be continuing,
the Trustee may exercise any of the remedies specified in Sections 5.03 and
5.04.
SECTION 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE; AUTHORITY OF TRUSTEE.
(a) The Issuer covenants that if any Notes are accelerated following
the occurrence of an Event of Default, the Issuer will, upon demand of the
Trustee, pay to it, for the benefit of the Holders of such Notes, the whole
amount then due and payable on such Notes for principal and interest, with
interest upon the overdue principal, and, to the extent payment at such rate of
interest shall be legally enforceable, upon overdue installments of interest, at
the applicable 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 Trustee and
its agents and counsel.
(b) If an Event of Default occurs and is continuing, the Trustee may
in its discretion proceed to protect and enforce its rights and the rights of
the Noteholders, by such appropriate Proceedings as the Trustee shall deem most
effective to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy or
legal or equitable right vested in the Trustee by this Indenture or by law.
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(c) In case there shall be pending, relative to the Issuer, the
Depositor or any other obligor upon the Notes or any Person having or claiming
an ownership interest in the Trust Estate, Proceedings under Title 11 of the
United States Code or any other applicable Federal or state bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, sequestrator or similar official shall
have been appointed for or taken possession of the Issuer, the Depositor or such
other obligor or Person, or its property, or in case of any other comparable
judicial Proceedings relative to the Issuer, the Depositor or other obligor upon
the Notes, or to the creditors or property of the Issuer, the Depositor or such
other obligor, the 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 Trustee shall have made any demand
pursuant to the provisions of this Section, shall be entitled and empowered, by
intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to file
such other papers or documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for reasonable
compensation to the Trustee and each predecessor Trustee, and their
respective agents, attorneys and counsel, and for reimbursement of all
expenses and liabilities incurred, and all advances made, by the Trustee
and each predecessor Trustee, except as a result of negligence or bad
faith) and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to vote
on behalf of the Holders of Notes in any election of a trustee, a standby
trustee or Person performing similar functions in any such Proceedings;
(iii) to collect and receive any moneys or other property payable
or deliverable on any such claims and to distribute all amounts received
with respect to the claims of the Noteholders and of the Trustee on their
behalf; and
(iv) to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
or the Holders of Notes allowed in any judicial proceedings relative to the
Issuer, its creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Trustee, and, in the event that the Trustee shall consent to the
making of payments directly to such Noteholders, to pay to the Trustee such
amounts as shall be sufficient to cover reasonable compensation to the Trustee,
each predecessor Trustee and their respective agents, attorneys and counsel, and
all other expenses and liabilities incurred, and all advances made, by the
Trustee and each predecessor Trustee except as a result of negligence or bad
faith.
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(d) Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or vote for or accept or adopt on behalf of any
Noteholder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Noteholder in any such proceeding
except, as aforesaid, to vote for the election of a trustee in bankruptcy or
similar Person.
(e) All rights of action and of asserting claims under this Indenture
or under any of the Notes, may be enforced by the Trustee without the possession
of any of the Notes or the production thereof in any trial or other Proceedings
relative thereto, and any such action or Proceedings instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment, subject to the payment of the expenses, disbursements and
compensation of the Trustee, each predecessor Trustee and their respective
agents and attorneys, shall be for the ratable benefit of the Holders of the
Notes.
(f) In any Proceedings brought by the Trustee (including any
Proceedings involving the interpretation of any provision of this Indenture),
the Trustee shall be held to represent all the Holders of the Notes, and it
shall not be necessary to make any Noteholder a party to any such Proceedings.
SECTION 5.04. REMEDIES. If an Event of Default shall have occurred
and be continuing, the Trustee may (subject to Section 5.05) and, in the case of
an Event of Default described in Section 5.01(iv) or (v), shall, as to the
actions described in the following clauses (i), (ii) and (iii):
(i) institute Proceedings in its own name and as or on behalf of
a trustee of an express trust for the collection of all amounts then
payable on the Notes or under this Indenture with respect thereto, whether
by declaration or otherwise, enforce any judgment obtained, and collect
from the Issuer and any other obligor upon such Notes moneys adjudged due;
(ii) institute Proceedings from time to time for the complete or
partial foreclosure of this Indenture with respect to the Trust Estate;
(iii) exercise any remedies of a secured party under the UCC and
any other remedy available to the Trustee and take any other appropriate
action to protect and enforce the rights and remedies of the Trustee on
behalf of the Noteholders; and
(iv) sell the Trust Estate 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; PROVIDED, HOWEVER, that the
Trustee may not sell or otherwise liquidate the Trust Estate following an
Event of Default unless
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(A) the Holders of 100% of the Outstanding Amount of the Notes
consent thereto,
(B) the proceeds of such sale or liquidation distributable to
the Noteholders will be sufficient to discharge in full all amounts
then due and unpaid upon such Notes for principal and interest, or
(C) the Trustee determines that the Trust Estate 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 Trustee provides prior
written notice to the Rating Agencies and obtains the consent of
Holders of 66-2/3% of the Outstanding Amount of the Notes.
In determining such sufficiency or insufficiency with respect to clause (B) or
(C), the Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the Trust
Estate for such purpose.
SECTION 5.05. OPTIONAL PRESERVATION OF THE CONTRACTS. If any Notes
have been declared to be due and payable under Section 5.02 following an Event
of Default and such declaration and its consequences have not been rescinded and
annulled, the Trustee may, but need not, elect to maintain possession of the
Trust Estate. It is the desire of the parties hereto and the Noteholders that
there be at all times sufficient funds for the payment of principal of and
interest on the Notes, and the Trustee shall take such desire into account when
determining whether or not to maintain possession of the Trust Estate. In
determining whether to maintain possession of the Trust Estate, the Trustee may,
but need not, obtain and rely upon an opinion of an Independent investment
banking or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Trust Estate for such purpose.
SECTION 5.06. PRIORITIES.
If the Trustee collects any money or property pursuant to this Article
V, including any money or property in respect of liquidation of the Trust Estate
pursuant to Section 5.04(a)(iv), the Trustee shall pay as promptly as
practicable out the money or property in the following order:
FIRST: amounts due and owing to the Trustee pursuant to Section 6.07;
SECOND: amounts due and owing and required to be distributed to the
Servicer pursuant to priority (i) of Section 8.03 and not previously
distributed;
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THIRD: to Class A Noteholders for amounts due and unpaid on the Class
A Notes for interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class A Notes for interest;
FOURTH: to Class A Noteholders for amounts due and unpaid on the
Class A Notes for principal, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Class A Notes for
principal;
FIFTH: to Class B Noteholders for amounts due and unpaid on the Class
B Notes for interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class B Notes for interest;
SIXTH: to Class B Noteholders for amounts due and unpaid on the Class
B Notes for principal, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class B Notes for
principal;
SEVENTH: amounts due and unpaid on the Equity Certificates for
interest and principal, to the Owner Trustee for distribution to Equity
Certificateholders in accordance with Section 5.2(c) of the Trust
Agreement;
EIGHTH: to the parties entitled thereto in accordance with the Cash
Collateral Agreement for amounts due and unpaid thereunder; and
NINTH: the remainder, if any, to the Owner Trustee for distribution
to Equity Certificateholders in accordance with Section 5.2(d) of the Trust
Agreement.
SECTION 5.07. LIMITATION OF SUITS. No Holder of any Note shall have
any right to institute any Proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless:
(i) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the Outstanding Amount
of the Notes have made written request to the Trustee to institute such
Proceeding in respect of such Event of Default in its own name as Trustee
hereunder;
(iii) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in complying with such request;
(iv) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute such Proceedings;
and
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(v) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority
of the Outstanding Amount of the Notes;
it being understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
Holders of Notes or to obtain or to seek to obtain priority or preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided.
In the event the Trustee shall receive conflicting or inconsistent
requests and indemnity from two or more groups of Holders of Notes, each
representing less than a majority of the Outstanding Amount of the Notes, the
Trustee may conclusively rely on and act upon the request of the group
representing the largest Outstanding Amount of the Notes.
SECTION 5.08. UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE
PRINCIPAL AND INTEREST. Notwithstanding any other provisions in this Indenture,
the Holder of any Note shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest on such Note
on or after the respective due dates thereof expressed in such Note or in this
Indenture (or, in the case of redemption, on or after the Redemption Date) and
to institute suit for the enforcement of any such payment, and such right shall
not be impaired without the consent of such Holder.
SECTION 5.09. RESTORATION OF RIGHTS AND REMEDIES. If the 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 Trustee or to such
Noteholder, then and in every such case the Issuer, the 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 Trustee and the Noteholders shall continue as
though no such Proceeding had been instituted.
SECTION 5.10. RIGHTS AND REMEDIES CUMULATIVE. No right or remedy
herein conferred upon or reserved to the 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 5.11. DELAY OR OMISSION NOT A WAIVER. No delay or omission
of the Trustee or any Holder of any Note to exercise any right or remedy
accruing upon any Default or Event of Default shall impair any such right or
remedy or constitute a waiver of any such Default or Event of Default or an
acquiescence therein. Every right
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and remedy given by this Article V or by law to the Trustee or to the
Noteholders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Noteholders, as the case may be.
SECTION 5.12. CONTROL BY NOTEHOLDERS. The Holders of a majority of
the Outstanding Amount of the Notes shall have the right to direct the time,
method and place of conducting any Proceeding for any remedy available to the
Trustee with respect to the Notes or exercising any trust or power conferred on
the Trustee; provided that
(i) such direction shall not be in conflict with any rule of law
or with this Indenture;
(ii) subject to the express terms of Section 5.04, any direction
to the Trustee to sell or liquidate all or any portion of the Trust Estate
shall be by the Holders of Notes representing not less than 100% of the
Outstanding Amount of the Notes; and
(iii) the Trustee may take any other action deemed proper by the
Trustee that is not inconsistent with such direction; PROVIDED, HOWEVER,
that, subject to Section 6.01, the Trustee need not take any action that it
determines might involve it in liability or might materially adversely
affect the rights of any Noteholders not consenting to such action.
SECTION 5.13. WAIVER OF PAST DEFAULTS.
The Holders of Notes of not less than a majority of the Outstanding
Amount 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 which cannot be
modified or amended without the consent of the Holder of each Note. In the case
of any such waiver, the Issuer, the Trustee and the Holders of the Notes shall
be restored to their former positions and rights hereunder, respectively; but no
such waiver shall extend to any subsequent or other Default or impair any right
consequent thereto.
Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or Event of Default or impair any right consequent thereto.
SECTION 5.14. UNDERTAKING FOR COSTS. All parties to this Indenture
agree, and each Holder of any Note by such Holder's acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture, or in any suit
against the Trustee for any
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action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall not apply to (a) any suit instituted by
the Trustee, (b) any suit instituted by any Noteholder, or group of Noteholders,
in each case holding in the aggregate more than 10% of the Outstanding Amount of
the Notes 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 5.15. WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in any manner whatsoever, claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantages of any such law, and covenants that
it will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 5.16. ACTION ON NOTES. The 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 Trustee or the Noteholders shall be impaired by the recovery
of any judgment by the Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Trust Estate or upon any
of the assets of the Issuer.
SECTION 5.17. PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS.
(a) Promptly following a request from the Trustee to do so and at the
Depositor's expense, the Issuer agrees to take all such lawful action as the
Trustee may request to compel or secure the performance and observance by the
Depositor or the Servicer, as applicable, of each of their obligations to the
Issuer under or in connection with the Transfer and Servicing Agreement in
accordance with the terms thereof, and to exercise any and all rights, remedies,
powers and privileges lawfully available to the Issuer under or in connection
with the Transfer and Servicing Agreement to the extent and in the manner
directed by the Trustee, including the transmission of notices of default on the
part of the Depositor or the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Depositor or the Servicer of each of their obligations under the Transfer and
Servicing Agreement.
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(b) If an Event of Default has occurred and is continuing, the
Trustee may, and at the direction (which direction shall be in writing,
including facsimile) of the Holders of at least 66-2/3% of the Outstanding
Amount of the Notes shall, exercise all rights, remedies, powers, privileges and
claims of the Issuer against the Depositor or the Servicer under or in
connection with the Transfer and Servicing Agreement, including the right or
power to take any action to compel or secure performance or observance by the
Depositor or the Servicer of each of their obligations to the Issuer thereunder
and to give any consent, request, notice, direction, approval, extension or
waiver under the Transfer and Servicing Agreement, and any right of the Issuer
to take such action shall be suspended.
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ARTICLE VI
THE TRUSTEE
SECTION 6.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise the rights and powers vested in it by this Indenture with
the same degree of care and skill in their exercise as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the 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
Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture; however,
the Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture and, if
applicable, the Trustee's other Related Documents.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.12.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall not be liable for interest on any money
received by it.
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(f) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law or the terms of this Indenture
or the Transfer and Servicing Agreement.
(g) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayments
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
(i) In no event shall the Trustee be required to perform, or be
responsible for the manner of performance of, any of the obligations of the
Servicer, or any other party, under the Transfer and Servicing Agreement, except
during such time, if any, as the Trustee shall be the successor to, and be
vested with the rights, powers, duties and privileges of the Servicer, in
accordance with the terms of the Transfer and Servicing Agreement.
(j) The Trustee shall, and hereby agrees that it will, perform all of
the obligations and duties required of it under the Transfer and Servicing
Agreement.
(k) Without limiting the generality of this Section, the Trustee
shall have no duty (i) to see to any recording, filing or depositing of this
Indenture or any agreement referred to herein or any financing statement
evidencing a security interest in the Equipment, or to see to the maintenance of
any such recording or filing or depositing or to any recording, refiling or
redepositing of any thereof, (ii) to see to any insurance of the Equipment or
Obligors or to effect or maintain any such insurance, (iii) except as
specifically provided in the Transfer and Servicing Agreement, to see to the
payment or discharge of any tax, assessment or other governmental charge or any
Lien or encumbrance of any kind owing with respect to, assessed or levied
against any part of the Trust Estate, (iv) to confirm or verify the contents of
any reports or certificates delivered to the Trustee pursuant to this Indenture
or the Transfer and Servicing Agreement believed by the Trustee to be genuine
and to have been signed or presented by the proper party or parties, or (v) to
inspect the Equipment at any time or ascertain or inquire as to the performance
of observance of any of the Issuer's, the Depositor's or the Servicer's
representations, warranties or covenants or the Servicer's duties and
obligations as Servicer under the Transfer and Servicing Agreement.
(l) Except for actions expressly authorized by this Indenture or the
Transfer and Servicing Agreement or taken by the Trustee pursuant to Section
6.01(a), the Trustee shall take no action reasonably likely to impair (i) the
interests of the Trust
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Estate in any contract or agreement now existing or hereafter created or (ii)
the value of any contract or agreement now existing or hereafter created.
(m) The Trustee shall have no power to vary the corpus of the Trust
Estate, except as expressly provided in this Indenture.
(n) In the event that the Note Registrar or the Paying Agent (if
other than the Trustee) shall fail to perform any obligation, duty or agreement
in the manner or on the day required to be performed by the Note Registrar or
the Paying Agent, as the case may be, under this Indenture, the Trustee shall be
obligated, as soon as possible upon knowledge of a Responsible Officer thereof
and receipt of appropriate records, if any, to perform such obligation, duty or
agreement in the manner so required.
(o) The Trustee shall not be required to take notice or be deemed to
have notice or knowledge of any Event of Default (other than an Event of Default
pursuant to Section 5.01(i) or (ii)) unless a Responsible Officer of the Trustee
shall have received written notice thereof or otherwise has actual knowledge
thereof. In the absence of receipt of such notice or knowledge, the Trustee may
conclusively assume that there is no Event of Default.
SECTION 6.02. RIGHTS OF TRUSTEE.
Except as otherwise provided in Section 6.01:
(a) the Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper person. The Trustee
need not (except under the circumstances described in paragraph (g) below)
investigate any fact or matter stated in the document;
(b) before the Trustee acts or refrains from acting, it may require
an Officer's Certificate (with respect to factual matters) or an Opinion of
Counsel, as applicable. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on the Officer's
Certificate or Opinion of Counsel, as applicable, or as directed by the
requisite amount of Note Owners as provided herein;
(c) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or a custodian or nominee, and the Trustee shall not be
responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed
with due care by it hereunder;
(d) the Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its
rights or powers;
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PROVIDED, HOWEVER, that the Trustee's conduct does not constitute willful
misconduct, negligence or bad faith;
(e) the Trustee may consult with counsel, and the advice or opinion
of counsel with respect to legal matters relating to this Indenture and the
Notes shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the advice or opinion of
such counsel;
(f) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders of Notes, pursuant to the provisions of
this Indenture, unless such Holders of Notes shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that may be incurred therein or thereby; PROVIDED, HOWEVER,
that the Trustee shall, upon the occurrence of an Event of Default (that
has not been cured), exercise the rights and powers vested in it by this
Indenture with the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct
of such person's own affairs;
(g) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
bond or other paper or document, unless requested in writing to do so by
the Holders of Notes evidencing not less than 25% of the Outstanding Amount
thereof; PROVIDED, HOWEVER, that if the payment within a reasonable time to
the Trustee of the costs, expenses or liabilities likely to be incurred by
it in the making of such investigation is, in the opinion of the Trustee,
not reasonably assured to the Trustee by the security afforded to it by the
terms of this Indenture or the Transfer and Servicing Agreement, the
Trustee may require reasonable indemnity against such cost, expense or
liability as a condition to so proceeding; the reasonable expense of every
such examination shall be paid by the Person making such request, or, if
paid by the Trustee, shall be immediately reimbursed by the Person making
such request upon demand; and
(h) The right of the Trustee to perform any discretionary act
enumerated in this Indenture shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or willful
misconduct in the performance of such act.
SECTION 6.03. INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its
individual or any other capacity may become the owner or pledgee of Notes and
may otherwise deal with the Issuer or its Affiliates with the same rights it
would have if it were not Trustee. Any Paying Agent, Note Registrar,
co-registrar or co-paying agent may do the
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same with like rights. However, the Trustee is required to comply with Sections
6.11 and 6.12.
SECTION 6.04. TRUSTEE'S DISCLAIMER. The Trustee shall not be
responsible for and, except as provided in Section 6.13, makes no representation
as to the validity or adequacy of this Indenture, the Trust Estate or the Notes,
it shall not be accountable for the Issuer's use of the proceeds from the Notes,
and it shall not be responsible for any statement of the Issuer in the Indenture
or in any document issued in connection with the sale of the Notes or in the
Notes other than the Trustee's certificate of authentication.
SECTION 6.05. NOTICE OF DEFAULTS. If a Default occurs and is
continuing and if it is known to a Responsible Officer of the Trustee, the
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 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 6.06. REPORTS BY TRUSTEE TO HOLDERS. The Trustee shall
provide or cause to be provided to each Noteholder all such tax information as
may be required by law to be distributed to enable such holder to prepare its
federal and state income tax returns.
SECTION 6.07. COMPENSATION AND INDEMNITY.
(a) The Servicer, pursuant to the Transfer and Servicing Agreement,
has covenanted and agreed to pay to the Trustee, and the Trustee shall be
entitled to, certain annual fees and to reimburse the Trustee for all ordinary
and reasonable out-of-pocket expenses incurred or made by it in connection with
the performance of its duties hereunder (excluding those incurred or made in the
performance of its duties under Article V, as referred to in paragraph (b)
below). Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts.
(b) The Trustee shall also be entitled to reimbursement, from moneys
available therefor in accordance with Section 5.06, for all reasonable
out-of-pocket expenses (including the reasonable fees of any attorneys,
investment bankers and public accountants) incurred or made by it in connection
with the performance of its duties under Article V. When the Trustee incurs
expenses after the occurrence of a Default specified in Section 5.01(iv) or (v)
with respect to the Issuer, the expenses are intended to constitute expenses of
administration under Title 11 of the United States Code or any other applicable
Federal or state bankruptcy, insolvency or similar law. Notwithstanding
anything else set forth in this Indenture or the Related Documents, the Trustee
agrees that the obligations of the Issuer to the Trustee hereunder and under the
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Related Documents shall be recourse to the Trust Estate only. In addition, the
Trustee agrees that its recourse to the Issuer or the Trust Estate shall be
limited to the right to receive the reimbursement referred to in the first
sentence of this paragraph.
(c) The Trustee and any director, officer, employee or agent of the
Trustee shall be indemnified by the Issuer and held harmless against any loss,
liability or reasonable expense incurred in connection with this Indenture or
the Notes, other than any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence in the performance by the Trustee
of its duties hereunder or any loss, liability or expense incurred by the
Trustee in connection with the performance of its duties pursuant to Section
6.01, including, without limitation, any such loss, liability or expense
incurred in connection with any legal action or resulting from any error in any
tax or information return prepared by any Person other than the Trustee.
SECTION 6.08. REPLACEMENT OF TRUSTEE. The Trustee may resign at any
time by so notifying the Issuer in writing. The Issuer may remove the Trustee
if:
(i) the Trustee fails to comply with Section 6.11;
(ii) a court having jurisdiction in the premises in respect of
the Trustee in an involuntary case or proceeding under federal or state
banking or bankruptcy laws, as now or hereafter constituted, or any other
applicable federal or state bankruptcy, insolvency or other similar law,
shall have entered a decree or order granting relief or appointing a
receiver, liquidator, assignee, custodian, trustee, conservator,
sequestrator (or similar official) for the Trustee or for any substantial
part of the Trustee's property, or ordering the winding-up or liquidation
of the Trustee's affairs;
(iii) an involuntary case under the federal bankruptcy laws, as
now or hereafter in effect, or another present or future federal or state
bankruptcy, insolvency or similar law is commenced with respect to the
Trustee and such case is not dismissed within 60 days;
(iv) the Trustee commences a voluntary case under any federal or
state banking or bankruptcy laws, as now or hereafter constituted, or any
other applicable federal or state bankruptcy, insolvency or other similar
law, or consents to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, conservator, sequestrator (or
other similar official) for the Trustee or for any substantial part of the
Trustee's property, or makes any assignment for the benefit of creditors or
fails generally to pay its debts as such debts become due or takes any
corporate action in furtherance of any of the foregoing;
(v) the Trustee otherwise becomes incapable of acting; or
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(vi) the rating assigned to the long-term unsecured debt
obligations of the Trustee (or the holding company thereof) by the Rating
Agencies shall be lowered below the rating of "BBB", "Baa3" or equivalent
rating or be withdrawn by any Rating Agency.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Issuer shall promptly appoint a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee, to the Issuer and to each Rating Agency.
Thereupon the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers and
duties of the Trustee under this Indenture. The successor Trustee shall mail a
notice of its succession to Noteholders. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of a majority in Outstanding Amount of the Notes may petition any court
of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 6.11, any Noteholder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor Trustee
pursuant to this Section and payment of all fees and expenses owed to the
retiring Trustee. Notwithstanding the replacement of the Trustee pursuant to
this Section, the retiring Trustee shall be entitled to payment or reimbursement
of such amounts as such Person is entitled pursuant to Section 6.07.
SECTION 6.09. SUCCESSOR TRUSTEE BY MERGER. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee; PROVIDED that no such merger,
conversion or consolidation shall relieve the Trustee of its obligation to
comply with Section 6.11. The Trustee shall provide the Rating Agencies prompt
notice of any such transaction.
In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Notes shall have been authenticated but not delivered, any
such successor to the
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Trustee may adopt the certificate of authentication of any predecessor trustee,
and deliver such Notes so authenticated; and in case at that time any of the
Notes shall not have been authenticated, any successor to the Trustee may
authenticate such Notes either in the name of any predecessor hereunder or in
the name of the successor to the Trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the Notes or in
this Indenture provided that the certificate of the Trustee shall have.
SECTION 6.10. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
(a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Trust may at the time be located, the Trustee shall have
the power and may execute and deliver all instruments to appoint one or more
Persons to act as a co-trustee or co-trustees, or separate trustee or separate
trustees, of all or any part of the Trust, and to vest in such Person or
Persons, in such capacity and for the benefit of the Noteholders, such title to
the Trust, or any part hereof, and, subject to the other provisions of this
Section, such powers, duties, obligations, rights and trusts as the Trustee may
consider necessary or desirable. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor Trustee under
Section 6.11 and no notice to Noteholders of the appointment of any co-trustee
or separate trustee shall be required under Section 6.08.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and exercised
or performed by the Trustee and such separate trustee or co-trustee jointly
(it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Trustee joining in such act),
except to the extent that under any law of any jurisdiction in which any
particular act or acts are to be performed the Trustee shall be incompetent
or unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to the Trust
or any portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-trustee, but solely at the
direction of the Trustee;
(ii) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
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(c) Any notice, request or other writing given to the Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Indenture, specifically including every provision of this Indenture
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
SECTION 6.11. ELIGIBILITY; DISQUALIFICATION. The Trustee shall at
all times satisfy the requirements of TIA Section 310(a). The Trustee shall
have a combined capital and surplus of at least $50,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA Section 310(b), including the optional provision permitted by the second
sentence of TIA Section 310(b)(9); PROVIDED, HOWEVER, that there shall be
excluded from the operation of TIA Section 310(b)(1) any indenture or indentures
under which other securities of the Issuer are outstanding if the requirements
for such exclusion set forth in TIA Section 310(b)(1) are met.
SECTION 6.12. PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER. The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.
SECTION 6.13. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The
Trustee represents and warrants as of the Closing Date that:
(i) the Trustee is a banking corporation organized, existing and
in good standing under the laws of the State of New York;
(ii) the Trustee has full power, authority and right to execute,
deliver and perform this Indenture and each of the Trustee's Related
Documents, and has taken all necessary action to authorize the execution,
delivery and performance by it of this Indenture and each such Related
Document; and
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(iii) each of this Indenture and the Trustee's Related Documents
has been duly executed and delivered by the Trustee and represents a legal,
valid and binding obligation of the Trustee enforceable against the Trustee
in accordance with its terms, except as such enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect affecting the enforcement of
creditors' rights in general and except as such enforceability may be
limited by general principles of equity (whether considered in a suit at
law or in equity).
SECTION 6.14. SERVICER'S OBLIGATIONS. The Trustee shall, subject to
Section 6.01, use its reasonable good faith efforts to cause the Servicer duly
and punctually to perform all of its duties and obligations under the Transfer
and Servicing Agreement.
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ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.01. NOTE REGISTRAR TO FURNISH TRUSTEE NAMES AND ADDRESSES
TO NOTEHOLDERS. The Note Registrar will furnish or cause to be furnished to the
Trustee (a) not more than five 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
Trustee may reasonably require, of the names and addresses of the Holders of
Notes as of such Record Date, (b) at such other times as the Trustee may request
in writing, within 30 days after receipt by the Note Registrar of any such
request, a list of similar form and content as of a date not more than 10 days
prior to the time such list is furnished; PROVIDED, HOWEVER, that so long as the
Trustee is the Note Registrar, no such list shall be required to be furnished.
SECTION 7.02. PRESERVATION OF INFORMATION; COMMUNICATIONS TO
NOTEHOLDERS.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of the Holders of Notes contained in the
most recent list furnished to the Trustee as provided in Section 7.01 and the
names and addresses of Holders of Notes received by the Trustee in its capacity
as Note Registrar. The Trustee may destroy any list furnished to it as provided
in such Section 7.01 upon receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA Section 312(b) with
other Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Trustee and the Note Registrar shall have the
protection of TIA Section 312(c).
SECTION 7.03. REPORTS BY ISSUER.
(a) The Issuer shall:
(i) file with the Trustee and the Luxembourg Listing Agent,
within 15 days after the Issuer is required to file the same with the
Commission, copies of the annual reports and of the information, documents
and other reports (or copies of such portions of any of the foregoing as
the Commission may from time to time by rules and regulations prescribe)
which the Issuer may be required to file with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act;
(ii) file with the Trustee and the Commission in accordance with
rules and regulations prescribed from time to time by the Commission such
additional information, documents and reports with respect to compliance by
the Issuer
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with the conditions and covenants of this Indenture as may be required from
time to time by such rules and regulations; and
(iii) supply to the Trustee and the Luxembourg Listing Agent a
sufficient number of copies (and the Trustee shall transmit by mail to all
Noteholders described in TIA Section 313(c)) of such summaries of any
information, documents and reports required to be filed by the Issuer
pursuant to clauses (i) and (ii) of this paragraph as may be required by
rules and regulations prescribed from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year. In the event the Issuer changes
its fiscal year, it shall promptly notify the Trustee.
SECTION 7.04. REPORTS BY TRUSTEE. If required by TIA Section 313(a),
within 60 days after each March 31 beginning with March 31, 1997, the Trustee
shall mail to each Noteholder as required by TIA Section 313(c) and the
Luxembourg Listing Agent a brief report dated as of such date that complies with
TIA Section 313(a). The Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Noteholders shall
be filed by the Trustee with the Commission, the Luxembourg Stock Exchange and
each other stock exchange, if any, on which the Notes are listed. The Issuer
shall notify the Trustee if and when the Notes are listed on any other stock
exchange.
SECTION 7.05. STATEMENTS TO NOTEHOLDERS AND EQUITY
CERTIFICATEHOLDERS.
(a) On each Payment Date, the Trustee shall include with each
distribution to each Noteholder, a statement (which statement shall also be
provided to each Rating Agency and to the Luxembourg Listing Agent), based
solely on information in the Servicer's Certificate delivered on the related
Determination Date pursuant to Section 3.9 of the Transfer and Servicing
Agreement, in substantially the form attached hereto as Exhibit B.
(b) On each Payment Date, the Owner Trustee shall include with each
distribution to each Equity Certificateholder, a statement (which statement
shall also be provided to each Rating Agency), based solely on information in
the Servicer's Certificate delivered on the related Determination Date pursuant
to Section 3.9 of the Transfer and Servicing Agreement, in substantially the
form attached hereto as Exhibit B.
(c) Note Owners may obtain copies of the statements delivered by the
Trustee pursuant to subsection (a) above upon written request to the Trustee at
its Corporate Trust Office (together with a certification that such Person is a
Note Owner and payment of any expenses associated with the distribution
thereof). Equity
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Certificate Owners may obtain copies of the certificates delivered by the Owner
Trustee pursuant to subsection (b) above upon written request to the Owner
Trustee at the Corporate Trust Office (together with a certification that such
Person is an Equity Certificate Owner and payment of any expenses associated
with the distribution thereof).
SECTION 7.06. AVAILABILITY OF REPORTS, STATEMENTS AND OTHER
INFORMATION TO NOTE OWNERS IN LUXEMBOURG. Note Owners may obtain copies of all
statements, reports and other documents and information furnished to the
Luxembourg Listing Agent pursuant to this Article VII upon written request to
the Luxembourg Listing Agent. The Luxembourg Listing Agent shall publish notice
of the availability of such statements, reports and other documents and
information periodically (the frequency of such publications to be at the
direction of the Depositor, but in any event no less frequently than annually,
commencing in November, 1996) in the LUXEMBURGER WORT or another leading
newspaper having general circulation in Luxembourg.
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ARTICLE VIII
TRUST ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.01. COLLECTION OF MONEY. Except as otherwise expressly
provided herein, the Trustee may demand payment or delivery of, and shall
receive and collect, directly and without intervention or assistance of any
fiscal agent or other intermediary, all money and other property payable to or
receivable by the Trustee pursuant to this Indenture. The Trustee shall apply
all such money received by it as provided in this Indenture. Except as
otherwise expressly provided in this Indenture, if any default occurs in the
making of any payment or performance under any agreement or instrument that is
part of this Indenture or the Notes, the Trustee may take such action as may be
appropriate to enforce such payment or performance, including the institution
and prosecution of appropriate Proceedings. Any such action shall be without
prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.
SECTION 8.02. COLLECTION ACCOUNT. On or prior to the Closing Date,
the Trustee shall establish the Collection Account in the name of the Trustee
for the benefit of the Equity Certificateholders and the Noteholders. The
Collection Account shall be an Eligible Account and initially shall be a
segregated trust account established with the Trustee and maintained with the
Trustee, into which (i) the Servicer shall deposit or cause to be deposited all
amounts described in Sections 4.1, 4.2 and 5.1 of the Transfer and Servicing
Agreement, and (ii) the Trustee shall deposit the amounts described in Section
8.06(c).
SECTION 8.03. DISTRIBUTIONS. No later than 3:00 p.m., New York City
time, on each Payment Date, the Trustee shall (based solely on the information
contained in the Servicer's Certificate delivered on the related Determination
Date, upon which the Trustee may conclusively rely) distribute the following
amounts and in the order of priority specified below. Within each order of
priority, amounts shall be deemed withdrawn first from Available Pledged
Revenues, and second (but only as to amounts described in clauses (ii) through
(iv) below) from amounts deposited in the Collection Account pursuant to Section
8.06(c).
(i) first, from the Available Pledged Revenues then on deposit
in the Collection Account, to the Servicer, the Servicing Fee for the
related Collection Period (less that portion thereof to be applied by the
Trustee in accordance with the Cash Collateral Account Agreement) and any
amounts specified in Section 4.2(c) of the Transfer and Servicing
Agreement, to the extent the Servicer has not reimbursed itself in respect
of such amounts pursuant to Section 4.4 of the Transfer and Servicing
Agreement;
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(ii) second, from the Amount Available then remaining on deposit
in the Collection Account, to the Note Distribution Account, an amount
equal to the Note Interest Distributable Amount for such Payment Date;
(iii) third, from the Amount Available then remaining on deposit
in the Collection Account, to the Equity Certificate Distribution Account,
an amount equal to the Equity Certificate Interest Distributable Amount for
such Payment Date;
(iv) fourth, from the Amount Available then remaining on deposit
in the Collection Account, (A) to the Note Distribution Account, an amount
equal to the Note Principal Distributable Amount for such Payment Date, and
(B) to the Equity Certificate Distribution Account, an amount equal to the
Equity Certificate Principal Distributable Amount for such Payment Date, or
if the remaining Amount Available is less than the sum of the amounts
specified in this clause (iv), such remaining Amount Available to the Note
Distribution Account and the Equity Certificate Distribution Account pro
rata based upon the Note Principal Distributable Amount and the Equity
Certificate Principal Distributable Amount, respectively;
(v) fifth, from the Amount Available then remaining on deposit
in the Collection Account, to the Cash Collateral Account, the amount, if
any, necessary to increase the balance therein to the Requisite Cash
Collateral Amount;
(vi) sixth, from the Amount Available then remaining on deposit
in the Collection Account, to the parties entitled thereto in accordance
with the Cash Collateral Account Agreement, any amounts due and unpaid
thereunder; and
(vii) seventh, any remaining Amount Available to the Equity
Certificate Distribution Account.
SECTION 8.04. NOTE DISTRIBUTION ACCOUNT.
(a) On or prior to the Closing Date, the Trustee shall establish the
Note Distribution Account in the name of the Trustee for the benefit of the
Noteholders. The Note Distribution Account shall be an Eligible Account and
initially shall be a segregated trust account established with the Trustee and
maintained with the Trustee.
(b) On each Payment Date and Redemption Date, the Trustee shall
distribute all amounts on deposit in the Note Distribution Account in the
following amounts and in the following order of priority (except as otherwise
provided in Section 5.06):
(i) interest on the Notes in the following order of priority:
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(A) to the Class A-1 Noteholders, the Class A-1 Interest
Distributable Amount, to the Class A-2 Noteholders, the Class A-2
Interest Distributable Amount, to the Class A-3 Noteholders, the Class
A-3 Interest Distributable Amount, and to the Class A-4 Noteholders,
the Class A-4 Interest Distributable Amount, or, if the remaining
amount on deposit in the Note Distribution Account is less than the
sum of the amounts specified in this clause (A), such remaining amount
pro rata to each of such Classes based their respective entitlements
to interest pursuant to this clause (A); and
(B) to the Class B Noteholders, the Class B Interest
Distributable Amount; and
(ii) principal on the Notes in the following order of priority:
(A) principal of the Class A-1 Notes until the principal balance
thereof has been reduced to zero;
(B) principal of the Class A-2 Notes until the principal balance
thereof has been reduced to zero;
(C) principal of the Class A-3 Notes until the principal balance
thereof has been reduced to zero;
(D) principal of the Class A-4 Notes until the principal balance
thereof has been reduced to zero; and
(E) principal of the Class B Notes until the principal balance
thereof has been reduced to zero.
SECTION 8.05. SERVICING ACCOUNT. On or prior to the Closing Date,
the Trustee shall establish the Servicing Account in the name of the Trustee for
the benefit of the Equity Certificateholders, the Noteholders and the Depositor.
The Servicing Account shall be an Eligible Account. The Servicer shall deposit
or cause to be deposited in the Servicing Account all amounts described in
Sections 4.1 and 4.2 of the Transfer and Servicing Agreement, subject to Section
4.4 thereof. The Servicer shall make transfers from the Servicing Account, and
shall be entitled to make withdrawals from the Servicing Account, as provided in
the Transfer and Servicing Agreement.
SECTION 8.06. CASH COLLATERAL ACCOUNT.
(a) On or prior to the Closing Date, the Cash Collateral Account will
be established in accordance with the requirements of the Cash Collateral
Account Agreement for the benefit of (i) the Equity Certificateholders and the
Noteholders, to the extent of deficiencies resulting, directly or indirectly,
from delinquencies or defaults,
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or both, on the Contracts, and (ii) the Cash Collateral Account Lenders and the
Depositor, as their interests may appear. The Cash Collateral Account shall be
an Eligible Account and initially shall be a segregated trust account
established with the Trustee and maintained with the Trustee. The Cash
Collateral Account will be funded in an amount equal to the Requisite Cash
Collateral Amount as of the Closing Date from (1) the proceeds of loans made by
the Cash Collateral Account Lenders in an amount equal to $111,482,000, which
proceeds shall be deposited in the Cash Collateral Account on or prior to the
Closing Date, and (2) proceeds of the Notes to be deposited therein in
accordance with Section 2.13.
(b) If the amount on deposit in the Cash Collateral Account on any
Payment Date (after giving effect to any deposits therein pursuant to Section
8.03(v) and any withdrawals therefrom pursuant to Section 8.06(c), but excluding
for this purpose any net earnings on the investment of funds therein, which will
not constitute Available Cash Collateral Amount and will be distributed in
accordance with Section 8.07(a)) is greater than the Requisite Cash Collateral
Amount for such Payment Date, the Servicer shall direct the Trustee to
distribute the amount of the excess in accordance with the Cash Collateral
Account Agreement. Amounts properly distributed pursuant to the prior sentence
shall be deemed released from the Trust Estate and the security interest herein
granted to the Trustee, and the Issuer shall in no event thereafter be required
to refund any such distributed amounts.
(c) On the last Business Day preceding each Payment Date, the Trustee
shall, in accordance with directions from the Servicer, withdraw from amounts on
deposit in the Cash Collateral Account, and deposit into the Collection Account,
an amount equal to the lesser of the Available Cash Collateral Amount for such
Payment Date and the sum of the following amounts, if any (to the extent the
deficiency represented by such amounts has resulted, directly or indirectly,
from delinquencies or defaults, or both, on the Contracts):
(i) the amount, if any, by which the Available Pledged Revenues
with respect to such Payment Date, after payment of the amounts specified
in clause (i) of Section 8.03, is less than the sum of the amounts
specified in clauses (ii) and (iii) of Section 8.03; plus
(ii) the Principal Deficiency Amount, if any, for such Payment
Date; plus
(iii) the amount, if any, by which the Available Pledged Revenues
with respect to the Stated Maturity Date for any Class of Notes or the
Equity Certificates, after payment of all amounts specified in clauses (i)
through (iii) of Section 8.03, is less than the remaining Principal Balance
of such Class of Notes or the Equity Certificate Balance, as applicable.
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In the event that the Available Cash Collateral Amount for any Payment Date is
less than the total amount, if any, specified above for such Payment Date, the
amount actually withdrawn by the Trustee shall be applied in the order of
priority specified above, and, within each clause specified above, in the order
of priority specified in Sections 8.03 and 8.04. For purposes of making
withdrawals from the Cash Collateral Account pursuant to this paragraph, the
Trustee may conclusively presume, in the absence of written notice from the
Servicer to the contrary, that all amounts to be so withdrawn have resulted,
directly or indirectly, from delinquencies or defaults, or both, on the
Contracts. The Servicer shall, in accordance with the Transfer and Servicing
Agreement, give the Trustee and the Cash Collateral Account Lenders' Agent
notice, at least three Business Days prior to each Payment Date, of the amounts,
if any, specified in clauses (i) through (iii) above for such Payment Date.
SECTION 8.07. GENERAL PROVISIONS REGARDING SERVICING ACCOUNT,
COLLECTION ACCOUNT, NOTE DISTRIBUTION ACCOUNT AND CASH COLLATERAL ACCOUNT.
(a) So long as no Default or Event of Default shall have occurred and
be continuing, all amounts held in the Servicing Account, the Collection
Account, the Note Distribution Account and the Cash Collateral Account shall, to
the extent permitted by applicable laws, rules and regulations, be invested, as
directed by the Servicer, in Eligible Investments that mature not later than one
Business Day prior to the Payment Date for the Collection Period to which such
amounts relate (or, in the case of the Cash Collateral Account, in Eligible
Investments that mature not later than one Business Day prior to the next
Payment Date with respect to which amounts may be withdrawn therefrom). Any
such written direction shall certify that any such investment is authorized by
this Section. Investments in Eligible Investments shall be made in the name of
the Trustee on behalf of the Trust, and such investments shall not be (1)
purchased at a price in excess of the principal amount thereof plus accrued
interest thereon, nor (2) sold or disposed of prior to their maturity at a price
less than the principal amount thereof plus accrued interest thereon. Any
investment of funds in the Servicing Account, the Collection Account, the Note
Distribution Account or the Cash Collateral Account shall be made in Eligible
Investments held by a financial institution in accordance with the following
requirements:
(i) all Eligible Investments shall be held in an account with
such financial institution in the name of the Trustee;
(ii) with respect to securities held in such account, such
securities shall be:
(A) certificated securities (as such term is used in N.Y. UCC
Section 8-313(d)(i)), securities deemed to be certificated securities
under applicable regulations of the United States government, or
uncertificated securities issued by an issuer organized under the laws
of the State of New York or the State of Delaware,
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(B) either (I) in the possession of such institution, (II) in
the possession of a "clearing corporation" (as such term is used in
Section 8-102(5) of the N.Y. UCC, registered in the name of such
clearing corporation or its nominee, not endorsed for collection or
surrender or any other purpose not involving transfer, not containing
any evidence of a right or interest inconsistent with the Trustee's
security interest therein, and held by such clearing corporation in an
account of such institution, (III) held in an account of such
institution with the Federal Reserve Bank of New York, or (IV) in the
case of uncertificated securities, issued in the name of such
institution, and
(C) identified, by book entry or otherwise, as held for the
account of, or pledged to, the Trustee on the records of such
institution, and such institution shall have sent the Trustee a
confirmation thereof;
(iii) with respect to repurchase obligations held in such account,
such repurchase obligations shall be identified by such institution, by
book entry or otherwise, as held for the account of, or pledged to, the
Trustee on the records of such institution, and the related securities
shall be held in accordance with the requirements of clause (ii) above; and
(iv) with respect to other Eligible Investments other than
securities and repurchase agreements, such Eligible Investments shall be
held in a manner acceptable to the Trustee.
Subject to the other provisions hereof, the Trustee shall have sole control over
each such investment and the income thereon, and any certificate or other
instrument evidencing any such investment, if any, shall be delivered directly
to the Trustee or its agent, together with each document of transfer, if any,
necessary to transfer title to such investment to the Trustee in a manner which
complies with this Section. All interest, dividends, gains upon transfer and
other income from, or earnings on, investments of funds in the Collection
Account and the Note Distribution Account and shall be deposited in the
Collection Account and distributed on the next Payment Date in accordance with
Section 8.03. All interest, dividends, gains upon transfer and other income
from, or earnings on, investments of funds in the Servicing Account shall be
retained therein until distributed to the Servicer as additional servicing
compensation in accordance with Section 3.8 of the Transfer and Servicing
Agreement. All interest, dividends, gains upon transfer and other income from,
or earnings on, investments of funds in the Cash Collateral Account shall be
retained therein until applied in accordance with the Cash Collateral Account
Agreement.
(b) Subject to Section 6.01(c), the Trustee shall not in any way be
held liable by reason of any insufficiency in any of the Servicing Account, the
Collection Account, the Note Distribution Account or the Cash Collateral Account
resulting from any loss on any Eligible Investment included therein except for
losses attributable to the
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Trustee's failure to make payments on such Eligible Investments issued by the
Trustee in accordance with their terms.
(c) The Trustee, in holding all funds in the Servicing Account, the
Collection Account, the Note Distribution Account and the Cash Collateral
Account, and in making distributions as provided in this Agreement, shall act
solely on behalf of and as agent for the Equity Certificateholders, the
Noteholders and (as to the Cash Collateral Account) the Cash Collateral Account
Lenders and the Depositor.
(d) Any account which is required to be established as an Eligible
Account pursuant to this Indenture and which ceases to be an Eligible Account
shall within five Business Days (or such longer period, not to exceed 30 days,
as to which each Rating Agency may consent) be established by the Trustee as a
new account which shall be an Eligible Account, and any cash and/or any
investments shall be transferred to such new account.
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ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS
OR EQUITY CERTIFICATEHOLDERS.
(a) Without the consent of the Holders of any Notes or Equity
Certificateholders, but with prior notice to the Rating Agencies, the Issuer and
the 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 provisions of the Trust Indenture Act as in force at the date of
the execution thereof), in form satisfactory to the Trustee, for any of the
following purposes:
(i) to correct or amplify the description of any property at any
time subject to the lien of this Indenture, or better to assure, convey and
confirm unto the Trustee any property subject to, or required to be
subjected to, the lien created by this Indenture, or to subject to the lien
created by this Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another Person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein and
in the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit of
the Holders of the Notes, or to surrender any right or power herein
conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any property
to or with the Trustee;
(v) to cure any ambiguity or to correct or supplement any
provision herein which may be inconsistent with any other provision herein;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes and
to add to or change any of the provisions of this Indenture as shall be
necessary to facilitate the administration of the trusts hereunder by more
than one trustee, pursuant to the requirements of Article VI;
(vii) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the qualification
of this Indenture under the TIA or under any similar Federal statute
hereafter enacted and to add to this Indenture such other provisions as may
be expressly required by the TIA; or
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(viii) to avoid a reduction, qualification or withdrawal of any
rating on the Notes.
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.
(b) The Issuer and the Trustee, when authorized by an Issuer Order,
may, also without the consent of any of the Holders of the Notes or the Equity
Certificateholders, but upon satisfaction of the Rating Agency Condition, enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; PROVIDED, HOWEVER, that such action
shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Noteholder.
SECTION 9.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS AND
EQUITY CERTIFICATEHOLDERS.
(a) The Issuer and the Trustee, when authorized by an Issuer Order,
also may, with prior notice to the Rating Agencies and the consent of a Note
Majority of each Class affected thereby, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Holders of the Notes under this
Indenture; PROVIDED, HOWEVER, that, no such supplemental indenture shall,
without the consent of the Holder of each Outstanding Note affected thereby:
(i) change the date, timing or method of determination 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 provision of this
Indenture relating to the application of collections on, or the proceeds of
the sale of, the Trust Estate to payment of principal of or interest on the
Notes, or change any place of payment where, or the coin or currency in
which, any Note or the interest thereon is payable, 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 the Notes on or after
the respective due dates thereof (or, in the case of redemption, on or
after the Redemption Date);
(ii) impair the right of the Holder to institute suit pursuant to
Section 5.08;
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(iii) reduce the percentage of the Outstanding Amount of the
Notes, the consent of the Holders of which is required for any such
supplemental indenture, or the consent of the Holders of which is required
for any waiver of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences provided for in this
Indenture;
(iv) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(v) reduce the percentage of the Outstanding Amount of the Notes
required to direct the Trustee to direct the Issuer to sell or liquidate
the Trust Estate pursuant to Section 5.04;
(vi) modify any provision of this Section except to increase any
percentage specified herein or to provide that certain additional
provisions of this Indenture or the Related Documents cannot be modified or
waived without the consent of the Holder of each Outstanding Note affected
thereby;
(vii) permit the creation of any lien ranking prior to or on a
parity with the lien created by this Indenture with respect to any part of
the Trust Estate or, except as otherwise permitted or contemplated herein,
terminate the lien created by this Indenture on any property at any time
subject hereto or deprive the Holder of any Note of the security provided
by the lien created by this Indenture;
(viii) modify or alter the definition of the term "Requisite Cash
Collateral Amount"; or
(viii) result in a reduction, qualification or withdrawal of the
rating of any class of Notes.
Any supplemental indenture to be entered into in accordance with this
Section shall be deemed to affect all Outstanding Notes other than any Class of
Notes with respect to which an Opinion of Counsel for the Issuer is addressed
and delivered to the Trustee to the effect that the interests of the Holders of
Notes of such Class are not affected in any material respect by the supplemental
indenture.
It shall not be necessary for any Act of Noteholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof. The
manner of obtaining such approvals shall be subject to such reasonable
requirements as the Trustee may prescribe.
(b) The Issuer and the Trustee, when authorized by an Issuer Order,
also may, with prior notice to the Rating Agencies and the consent of the Equity
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Certificateholders, enter into an indenture or indentures supplemental hereto
for the purpose of modifying the rights of the Equity Certificateholders under
this Indenture.
The Trustee may in its discretion, but shall not be obligated to,
determine whether or not the rights of the Equity Certificateholders under this
Indenture would be modified by any supplemental indenture, and any such
determination shall be conclusive upon the Equity Certificateholders. The
Trustee shall not be liable for any such determination made in good faith.
It shall not be necessary for the Equity Certificateholders to approve
the particular form of any proposed supplemental indenture, but it shall be
sufficient if the Equity Certificateholders shall approve the substance thereof.
The manner of obtaining such approvals and of evidencing the authorization of
the execution thereof by Equity Certificateholders shall be subject to such
reasonable requirements as the Trustee may prescribe.
(c) Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to this Section, the Trustee shall mail to the
Holders of the Notes and the Equity Certificateholders 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 Trustee to mail
such notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture.
SECTION 9.03. EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modifications thereby of the trusts created
by this Indenture, the Trustee shall be entitled to receive, and subject to
Sections 6.01 and 6.02 shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture that affects the Trustee's own
rights, duties, liabilities or immunities under this Indenture or otherwise.
SECTION 9.04. 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 Equity Certificates affected thereby, and the
respective rights, limitations of rights, obligations, duties, liabilities and
immunities under this Indenture of the Trustee, the Issuer, the Holders of the
Notes and the Equity Certificateholders 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.
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SECTION 9.05. 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 Trust Indenture Act as then
in effect so long as this Indenture shall then be qualified under the Trust
Indenture Act.
SECTION 9.06. REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Trustee shall, bear a
notation in form approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Issuer or the Trustee shall so determine, new
notes so modified as to conform, in the opinion of the Trustee and the Issuer,
to any such supplemental indenture may be prepared and executed by the Issuer
and authenticated and delivered by the Trustee in exchange for Outstanding
Notes.
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ARTICLE X
REDEMPTION OF NOTES
SECTION 10.01. REDEMPTION.
(a) In the event that the Depositor pursuant to Section 5.1 of the
Transfer and Servicing Agreement purchases the corpus of the Trust, the Notes
are subject to redemption in whole, but not in part, on the Payment Date on
which such repurchase occurs, for a purchase price equal to the Redemption
Price; PROVIDED, HOWEVER, that the Issuer has available funds sufficient to pay
the Redemption Price. The Depositor, the Servicer or the Issuer shall furnish
the Rating Agencies notice of such redemption. If the Notes are to be redeemed
pursuant to this paragraph, the Servicer or the Issuer shall furnish notice of
such election to the Trustee not later than 25 days (or such lesser number of
days as shall be satisfactory to the Trustee) prior to the Redemption Date, and
the Issuer shall deposit, or cause to be deposited, into the Note Distribution
Account the Redemption Price of the Notes to be redeemed, whereupon all such
Notes shall be due and payable on the Redemption Date upon the furnishing of a
notice complying with Section 10.02 to each Holder of the Notes.
(b) In the event that the assets of the Trust are sold pursuant to
Section 9.1 of the Trust Agreement, the proceeds of such sale shall be
distributed as provided in Section 5.06. If amounts are to be paid to
Noteholders pursuant to this paragraph, the Servicer or the Issuer shall, to the
extent practicable, furnish notice of such event to the Trustee not later than
25 days (or such lesser number of days as shall be satisfactory to the Trustee)
prior to the Redemption Date whereupon all such amounts shall be payable on the
Redemption Date.
SECTION 10.02. FORM OF REDEMPTION NOTICE.
(a) Notice of redemption under Section 10.01(a) shall be given by the
Trustee not less than five days prior to the applicable Redemption Date (1) by
first-class mail, postage prepaid, mailed to each Holder of Notes, as of the
close of business on the Record Date with respect to the Payment Date
immediately preceding the applicable Redemption Date, at such Holder's address
appearing in the Note Register, and (2) by publication in the LUXEMBURGER WORT
or another leading newspaper having general circulation in Luxembourg. If, at
the time of such redemption, the Notes are listed on the Luxembourg Stock
Exchange, notice thereof shall also be given to the Luxembourg Stock Exchange in
the same manner.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
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(iii) the place where such Notes are to be surrendered for payment
of the Redemption Price (which shall be the office or agency of the Issuer
to be maintained as provided in Section 3.02).
Notice of redemption of the Notes shall be given by the Trustee in the
name and at the expense of the Issuer. Failure to give notice of redemption, or
any defect therein, to any Holder of any Note shall not impair or affect the
validity of the redemption of any other Note.
(b) Prior notice of redemption under Section 10.01(b) is not required
to be given to Noteholders.
SECTION 10.03. NOTES PAYABLE ON REDEMPTION DATE. The Notes or
portions thereof to be redeemed shall, following notice of redemption (if any)
as required by Section 10.02, on the Redemption Date, become due and payable at
the Redemption 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 11.01. COMPLIANCE CERTIFICATES AND OPINIONS, ETC.
(a) Upon any application or request by the Issuer to the Trustee to
take any action under any provision of this Indenture, the Issuer shall furnish
to the Trustee (i) an Officer's Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with, (ii) an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if any, have been
complied with and (iii) (if required by the TIA) an Independent Certificate from
a firm of certified public accountants meeting the applicable requirements of
this Section, except that, in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Indenture, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition and
the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is necessary
to enable such signatory to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
(b)(i) Prior to the deposit of any property or securities with the
Trustee that is to be made the basis for the release of any property
subject to the lien created by this Indenture, the Issuer shall, in
addition to any obligation imposed in Section 11.01(a) or elsewhere in this
Indenture, furnish to the Trustee (1) an Officer's Certificate certifying
or stating the opinion of each person signing such certificate as to the
fair value (within 90 days of such deposit) to the Issuer of the property
or securities to be so deposited, (2) 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 and any other
requisite
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documents, and with respect to the execution and filing of any financing
statements and continuation statements, as are necessary to perfect and
make effective the first priority lien and security interest in favor of
the Trustee, for the benefit of the Trustee, created by this Indenture in
the property or securities to be so deposited, and reciting the details of
such action, or stating that, in the opinion of such counsel, no such
action is necessary to make such lien and security interest effective, and
(3) evidence that the Rating Agency Condition has been satisfied.
(ii) Whenever the Issuer is required to furnish to the Trustee an
Officer's Certificate certifying or stating the opinion of any signer
thereof as to the matters described in clause (i) above, the Issuer shall
also deliver to the Trustee an Independent Certificate as to the same
matters, if the fair value to the Issuer of the property to be so deposited
and of all other such property made the basis of any such withdrawal or
release since the commencement of the then-current fiscal year of the
Issuer, as set forth in the certificates delivered pursuant to clause (i)
above and this clause (ii), is 10% or more of the Outstanding Amount of the
Notes, but such a certificate need not be furnished with respect to any
property so deposited, if the fair value thereof to the Issuer as set forth
in the related Officer's Certificate is less than $25,000 or less than one
percent of the Outstanding Amount of the Notes.
(iii) Other than with respect to any release described in clause
(A) or (B) of Section 11.01(b)(v), whenever any property or securities are
to be released from the lien created by this Indenture, the Issuer shall
also furnish to the Trustee an Officer's Certificate certifying or stating
the opinion of each person signing such certificate as to the fair value
(within 90 days of such release) of the property or securities proposed to
be released and stating that in the opinion of such person the proposed
release will not impair the security created by this Indenture in
contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the Trustee an
Officer's Certificate certifying or stating the opinion of any signer
thereof as to the matters described in clause (iii) above, the Issuer shall
also furnish to the Trustee an Independent Certificate as to the same
matters if the fair value of the property or securities and of all other
property or securities (other than property described in clauses (A) or (B)
of Section 11.01(b)(v)) released from the lien created by this Indenture
since the commencement of the then current fiscal year, as set forth in the
certificates required by clause (iii) above and this clause (iv), equals
10% or more of the Outstanding Amount of the Notes, but such certificate
need not be furnished in the case of any release of property or securities
if the fair value thereof as set forth in the related Officer's Certificate
is less than $25,000 or less than one percent of the then Outstanding
Amount of the Notes.
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(v) Notwithstanding any other provision of this Section, the
Issuer may, without compliance with the other provisions of this Section,
(A) collect, liquidate, sell or otherwise dispose of Contracts as and to
the extent permitted or required by the Related Documents (including as
provided in Section 3.1 of the Transfer and Servicing Agreement) and (B)
make cash payments out of the Trust Accounts as and to the extent permitted
or required by the Related Documents.
SECTION 11.02. FORM OF DOCUMENTS DELIVERED TO TRUSTEE. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Servicer, the Depositor or the Issuer, stating that the information with
respect to such factual matters is in the possession of the Servicer, the
Depositor or the Issuer, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Trustee, it is provided that the Issuer shall
deliver any document as a condition of the granting of such application, or as
evidence of the Issuer's compliance with any term hereof, it is intended that
the truth and accuracy, at the time of the granting of such application or at
the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Trustee's right to rely upon the truth and accuracy of
any statement or opinion contained in any such document as provided in Article
VI.
SECTION 11.03. ACTS OF NOTEHOLDERS.
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(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Trustee, and, where it is hereby expressly required, to the
Issuer. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the
Noteholders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 6.01) conclusive in
favor of the Trustee and the Issuer, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Trustee deems
sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Notes shall bind the Holder of every
Note issued upon the registration thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to be done by the
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.
SECTION 11.04. NOTICES, ETC., TO TRUSTEE, ISSUER, LUXEMBOURG LISTING
AGENT AND RATING AGENCIES. Any request, demand, authorization, direction,
notice, consent, waiver or Act of Noteholders or other documents provided or
permitted by this Indenture to be made upon, given or furnished to or filed
with:
(a) the Trustee by any Noteholder or by the Issuer shall be
sufficient for every purpose hereunder if in writing and mailed,
first-class, postage prepaid, to the Trustee at its Corporate Trust Office,
(b) the Issuer by the 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: Capita Equipment
Receivables Trust 1996-1, in care of The Bank of New York, as Owner
Trustee, 101 Barclay Street, Floor 12 East, New York, New York 10286,
Attention: Corporate Trust Administration--Asset Backed Unit, or at any
other address previously furnished in writing to the Trustee by the Issuer.
The Issuer shall promptly transmit any notice received by it from the
Noteholders to the Trustee, or
(c) the Luxembourg Listing Agent by the Trustee, by the Issuer or by
any Noteholder shall be sufficient for every purpose hereunder if in
writing and
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mailed, first-class, postage prepaid, to the Luxembourg Listing Agent
addressed to: Kredietbank S.A. Luxembourgeoise, 43, boulevard Royal,
L-2955 Luxembourg, Attention: Corporate Trust Division, or at any other
address previously furnished in writing to the Trustee by the Luxembourg
Listing Agent.
Notices required to be given to the Rating Agencies by the Issuer, the
Trustee or the Owner Trustee shall be in writing, personally delivered or mailed
by certified mail, return receipt requested to (i) in the case of Moody's, at
the following address: Moody's Investors Service, Inc., ABS Monitoring
Department, 99 Church Street, New York, New York 10007, (ii) in the case of
Standard & Poor's, at the following address: Standard & Poor's Ratings Services,
26 Broadway (20th Floor), New York, New York 10004, Attention of Asset Backed
Surveillance Department (iii) in the case of Fitch, at the following address:
Fitch Investors Services, L.P., One State Street Plaza, New York, New York 10004
(and, in the case of any Servicer's Certificate, with an additional copy to
Fitch Investors Services, L.P., 1201 East 7th Street, Powell, Wyoming 82435) and
(iv) in the case of Duff & Phelps, at the following address: Duff & Phelps
Credit Rating Co., 17 State Street, New York, New York 10004; or as to each of
the foregoing, at such other address as shall be designated by written notice to
the other parties.
SECTION 11.05. NOTICES TO NOTEHOLDERS; WAIVER. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if (i) in
writing and mailed, first-class, postage prepaid, to each Noteholder affected by
such event, at his address as it appears on the Note Register, and (ii)
published in the LUXEMBURGER WORT or another leading newspaper having general
circulation in Luxembourg, not later than the latest date, and not earlier than
the earliest date, prescribed for the giving of such notice. In any case where
notice to Noteholders is given by mail, neither the failure to mail such notice
nor any defect in any notice so mailed to any particular Noteholder shall affect
the sufficiency of such notice with respect to other Noteholders, and any notice
that is mailed in the manner herein provided shall conclusively be presumed to
have been duly given.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Trustee but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event of Noteholders when such notice is required to be
given pursuant to any provision of this Indenture, then any reasonable manner of
giving such notice as shall be satisfactory to the Trustee shall be deemed to be
a sufficient giving of such notice.
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Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute a Default or
Event of Default.
SECTION 11.06. ALTERNATE PAYMENT AND NOTICE PROVISIONS.
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Holder of a Note
providing for a method of payment, or notice by the Trustee or any Paying Agent
to such Holder, that is different from the methods provided for in this
Indenture for such payments or notices. The Issuer will furnish to the Trustee
a copy of each such agreement and the Trustee will cause payments to be made and
notices to be given in accordance with such agreements.
SECTION 11.07. CONFLICT WITH TRUST INDENTURE ACT. If any provision
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control.
The provisions of TIA Sections 310 through 317 that impose duties on
any Person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
SECTION 11.08. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
SECTION 11.09. SUCCESSORS AND ASSIGNS. All covenants and agreements
in this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not.
All agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 11.10. SEVERABILITY. In case any provision in this Indenture
or in the Notes shall be invalid, illegal or unenforceable, the validity,
legality, and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
SECTION 11.11. BENEFITS OF INDENTURE. Nothing in this Indenture or
in the Notes, express or implied, shall give to any Person, other than the
parties hereto and their successors hereunder, and the Noteholders, and any
other party secured hereunder, and any other Person with an ownership interest
in any part of the Trust Estate, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
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SECTION 11.12. LEGAL HOLIDAYS. In any case where the date on which
any payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
SECTION 11.13. GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICTS OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.14. COUNTERPARTS. This Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 11.15. RECORDING OF INDENTURE. If this Indenture is subject
to recording in any appropriate public recording offices, such recording is to
be effected by the Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Trustee or any other counsel reasonably
acceptable to the Trustee) to the effect that such recording is necessary either
for the protection of the Noteholders or any other Person secured hereunder or
for the enforcement of any right or remedy granted to the Trustee under this
Indenture.
SECTION 11.16. NO PETITION. The Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time institute against the Depositor or the Issuer, or
join in any institution against the Depositor or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Notes, this Indenture or any
of the Related Documents.
SECTION 11.17. INSPECTION. The Issuer agrees that, on reasonable
prior notice, it will permit any representative of the Trustee, during the
Issuer's normal business hours, to examine all the books of account, records,
reports, and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees, and independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested. The Trustee shall
and shall cause its representatives to hold in confidence all such information
(including the identity of the Obligors on the Contracts) except to the extent
disclosure may be required by Section 9-208 of the UCC or by any other
applicable law (and all reasonable applications for confidential treatment are
unavailing) and except to
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the extent that the Trustee may reasonably determine that such disclosure is
consistent with its obligations hereunder.
SECTION 11.18. LIMITATION OF LIABILITY. It is expressly understood
and agreed by the parties hereto that (a) this Agreement is executed and
delivered by The Bank of New York, not individually or personally but solely as
Owner Trustee of the Issuer under the Trust Agreement, in the exercise of the
powers and authority conferred and vested in it, (b) each of the
representations, undertakings and agreements herein made on the part of the
Issuer is made and intended not as personal representations, undertakings and
agreements by The Bank of New York but is made and intended for the purpose for
binding only the Issuer, (c) nothing herein contained shall be construed as
creating any liability on The Bank of New York, individually or personally, to
perform any covenant either expressed or implied contained herein, all such
liability, if any, being expressly waived by the parties to this Agreement and
by any person claiming by, through or under them and (d) under no circumstances
shall The Bank of New York be personally liable for the payment of any
indebtedness or expenses of the Issuer or be liable for the breach or failure of
any obligation, representation, warranty or covenant made or undertaken by the
Issuer under this Agreement or any related documents.
SECTION 11.19. AMENDMENT OF CASH COLLATERAL ACCOUNT AGREEMENT.
(a) The Trustee may consent to amendments to the Cash Collateral
Account Agreement without the consent of any of the Noteholders or Equity
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions in the Cash Collateral Account Agreement that may be inconsistent
with any other provision therein, or (iii) to make any other provisions with
respect to matters or questions arising under the Cash Collateral Account
Agreement that are not inconsistent with the provisions thereof; PROVIDED,
HOWEVER, that such action shall not, as evidenced by an Opinion of Counsel,
adversely affect in any material respect the interests of the Noteholders or
Equity Certificateholders.
(b) The Trustee may also consent to amendments to the Cash Collateral
Account Agreement with the consent of an Equity Certificate Majority and a Note
Majority for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of the Cash Collateral Account Agreement;
PROVIDED, HOWEVER, that no such amendment shall (a) reduce the amount available
in the Cash Collateral Account for the payment of interest or principal to
Noteholders or Equity Certificateholders, or (b) reduce the aforesaid percentage
required to consent to any such amendment, without the consent of the Holders of
all Equity Certificates or Notes then Outstanding and affected thereby; and
PROVIDED, FURTHER, that no such amendment shall be effective unless and until
the Rating Agency Condition has been satisfied.
-92-
<PAGE>
(c) Promptly after the execution of any such amendment, the Trustee
shall furnish written notification of the substance of such to each Equity
Certificateholder and Noteholder.
(d) It shall not be necessary for the consent of Equity
Certificateholders or Noteholders pursuant to Section 11.19(b) to approve the
particular form of any proposed amendment, but it shall be sufficient if such
consent shall approve the substance thereof.
-93-
<PAGE>
IN WITNESS WHEREOF, the Issuer and the Trustee have caused this
Indenture to be duly executed by their respective officers, thereunto duly
authorized, all as of the day and year first above written.
CAPITA EQUIPMENT RECEIVABLES TRUST
1996-1
By THE BANK OF NEW YORK,
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement
By /s/ Cheryl L. Laser
---------------------------------
Name: Cheryl L. Laser
---------------------------
Title: Assistant Vice President
---------------------------
THE CHASE MANHATTAN BANK,
not in its individual capacity but
solely as Trustee,
By /s/ Charles E. Dooley
---------------------------------
Name: Charles E. Dooley
---------------------------
Title: Vice President
---------------------------
-94-
<PAGE>
EXHIBIT A
Form of Depository Agreement
A-1
INTENTIONALLY
OMITTED
<PAGE>
EXHIBIT B
Form of Monthly Statements to Noteholders and Equity Certificateholders
B-1
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
I. INFORMATION REGARDING THE CONTRACTS
1. CONTRACT POOL PRINCIPAL BALANCE
a. Beginning of Collection Period(1) $
b. End of Collection Period $
c. Reduction for Collected Period $
2. DELINQUENT SCHEDULED PAYMENTS
a. Beginning of Collection Period $
b. End of Collection Period $
3. LIQUIDATED CONTRACTS
a. Number of Liquidated Contracts with respect to
Collection Period _______
b. Required Payoff Amounts of Liquidated Contracts $
c. Total Reserve for Liquidation Expenses
d. Total Liquidation Proceeds Received(2) $
e. Liquidation Proceeds Allocated to Owner Trust $
f. Liquidation Proceeds Allocated to Depositor $
g. Current Realized Losses $
4. PREPAID CONTRACTS
a. Number of Prepaid Contracts with respect to
Collection Period _______
b. Required Payoff Amounts of Prepaid Contracts $
5. PURCHASED CONTRACTS (BY TCC)
a. Number of Contracts Purchased by TCC with respect
to Collection Period _______
b. Required Payoff Amounts of Purchased Contracts $
__________
(1) For Initial Collection Period, equal to $3,185,229,329.
(2) Net of any addition to reserve for liquidation expenses.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE:
PAYMENT DATE:
COLLECTION PERIOD:
6. DELINQUENCY STATUS OF CONTRACTS (END OF COLLECTION PERIOD)(3)
----------------------------------------------------------------
% of Aggregate
Number of % of Aggregate Required Required Payoff
Contracts Contracts Payoff Amounts Amounts
----------------------------------------------------------------
a. Current
b. 31-60 days
c. 61-90 days
d. 91-120 days
e. 120+ days
f. Total
___________
(3) Show delinquency of Contracts as of the end of the current Collection
Period.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
7. HISTORICAL LOSS EXPERIENCE WITH RESPECT TO CONTRACTS
<TABLE>
<CAPTION>
-------------------------------------------------------------
3 Collection 6 Collection
[Month/Year] Periods Periods Cumulative
Collection Ending Ending Since
Period [Month/Year] [Month/Year] Cut-off Date
-------------------------------------------------------------
<S> <S> <S> <S> <S>
a. Number of Liquidated
Contacts
b. Number of Liquidated
Contracts as a Percentage
of Initial Contracts
c. Required Payoff Amounts
of Liquidated Contracts
d. Liquidation Proceeds
Allocated to Owner Trust
e. Aggregate Current
Realized Losses
f. Aggregate Current Realized
Losses as a Percentage of
Cut-off Date Contract Pool
Principal Balance
</TABLE>
__________
(4) Show loss experience of Contracts for the current Collection Period and
historic experience for most recent 3 and 6 month periods and cumulative
experience for the Trust.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
8. HISTORICAL DELINQUENCY EXPERIENCE WITH RESPECT TO CONTRACTS(5)
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
Required
Required Required Pay of Required
Payoff Payoff Amounts of Payoff
Amounts of % of Aggregate Amounts of % of Aggregate Contracts % of Aggregate Amounts of % of Aggregate
Contracts Required Contracts Required 91-120 Required Contracts Required
Collection 31-60 Days Payoff 61-90 Days Payoff Days Payoff 120+ Days Payoff
Periods Past Due Amounts Past Due Amounts Past Due Amounts Past Due Amounts
<S> <C> <C> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
__________
(5) Show delinquency experience for current and all prior Collection Periods.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
II. INFORMATION REGARDING THE SECURITIES
1. SUMMARY OF BALANCE INFORMATION(6)
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
Principal Class Factor Principal Class Factor
Balance as of as of Balance as of as of
Coupon [Month/Year] [Month/Year] [Month/Year] [Month/Year]
Class Rate Payment Date Payment Date Payment Date Payment Date
<S> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------
</TABLE>
a. Class A-1 Notes 5.60%
b. Class A-2 Notes 5.95%
c. Class A-3 Notes 6.11%
d. Class A-4 Notes 6.28%
e. Class B Notes 6.57%
f. Equity Certificates 6.75%
g. Total N.A.
___________
(6) Show information for current and immediately preceding Payment Date.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
2. MONTHLY PRINCIPAL AMOUNT
a. Principal Balance of Notes and Equity Certificates
(End of Collection Period) $
b. Contract Pool Principal Balance (End of Collection
Period) $
c. Monthly Principal Amount $
3. GROSS COLLECTIONS
a. Scheduled Payments Received $
b. Liquidation Proceeds Allocated to Owner Trust $
c. Required Payoff Amounts of Prepaid Contracts $
d. Required Payoff Amounts of Purchased Contracts $
e. Proceeds of Clean-up Call $
f. Investment Earnings on Collection Account and Note
Distribution Account $
g. Extension Fees Allocated to Owner Trust $
h. Total Gross Collections (sum (a) through (g)) $
4. DETERMINATION OF AVAILABLE FUNDS
a. Total Gross Collections $
b. Withdrawal from Cash Collateral Account $
c. Total Available Funds (sum of (a) and (b)) $
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
5. APPLICATION OF AVAILABLE FUNDS
----------------------------------------------------------
Item Amount Remaining Available Funds
----------------------------------------------------------
a. Total Available Funds
b. Servicing Fee
c. Interest on Notes:
i) Class A-1 Notes
ii) Class A-2 Notes
iii) Class A-3 Notes
iv) Class A-4 Notes
v) Class B Notes
d. Interest on Equity
Certificates
e. Principal of Notes and
Equity Certificates:
i) Class A-1 Notes
ii) Class A-2 Notes
iii) Class A-3 Notes
iv) Class A-4 Notes
v) Class B Notes
vi) Equity Certificates
f. Deposit to Cash
Collateral Account
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
----------------------------------------------------------
Item Amount Remaining Available Funds
----------------------------------------------------------
g. Amount to be applied
in accordance with
CCA Loan Agreement
h. Balance, if any, to
Equity Certificates
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
III. INFORMATION REGARDING THE CASH COLLATERAL ACCOUNT
1. BALANCE RECONCILIATION(7)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
[Month/Year] [Month/Year]
Item Payment Date Payment Date
---------------------------------------------------------------------------------------------------
<S> <C> <C>
a. Available Cash Collateral Amount (Beginning) $ $
b. Deposits to Cash Collateral Account $ $
c. Withdrawals from Cash Collateral Account $ $
d. Releases of Cash Collateral Account Surplus $ $
e. Available Cash Collateral Amount (End) $ $
f. Requisite Cash Collateral Amount $ $
g. Cash Collateral Account Shortfall $ $
2. CALCULATION OF REQUISITE CASH COLLATERAL AMOUNT
a. For Payment Dates from, and including, the
November 1996 Payment Date to, and including, the
October 1997 Payment Date
1) Initial Cash Collateral Amount $207,040,000
b. For Payment Dates from, and including, the November 1997
Payment Date until the Final Payment Date, the sum of
1) 8% of the Contract Pool Principal Balance
2) The Aggregate Principal Balance of the Notes and the
Equity Certificate Balance less the Contract Pool
Principal Balance $
3) Tool $
</TABLE>
__________
(7) Show for current and immediately preceding Payment Date.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
c. Floor equal to the lesser of
1) 2% of Cut-Off Date Contract Pool Principal
Balance ($63,704,600); and
2) the Aggregate Principal Balance of the Notes
and the Equity Certificate Balance $
d. Requisite Cash Collateral Amount $
3. CALCULATION OF CASH COLLATERAL ACCOUNT WITHDRAWALS
a. Interest Shortfalls $
b. Principal Deficiency Amount $
c. Principal Payable at Stated Maturity Date of Class
of Notes or Equity Certificates $
d. Total Cash Collateral Account Withdrawals $
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE:
PAYMENT DATE:
COLLECTION PERIOD:
IV. INFORMATION REGARDING DISTRIBUTIONS ON SECURITIES
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------
Distribution Class A-1 Class A-2 Class A-3 Class A-4 Class B Equity
Amounts Notes Notes Notes Notes Notes Certificates
<S> <C> <C> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------------
</TABLE>
1. INTEREST DUE
2. INTEREST PAID
3. INTEREST SHORTFALL
4. PRINCIPAL PAID
5. TOTAL DISTRIBUTION AMOUNT
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
V. INFORMATION REGARDING OTHER POOL CHARACTERISTICS (8)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
As of End of [Month/Year] As of End of [Month/Year]
Item Collection Period Collection Period
--------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. ORIGINAL CONTRACT CHARACTERISTICS
a. Original Number of Contracts 280,634 N.A.
b. Cut-Off Date Contract Pool $3,185,229,329 N.A.
Principal Balance
c. Original Weighted Average 38.6 months N.A.
Remaining Term
d. Weighted Average Original Term 56.1 months N.A.
2. CURRENT CONTRACT CHARACTERISTICS
a. Number of Contracts
b. Average Contract
Principal Balance
c. Weighted Average Remaining
Term
</TABLE>
__________
(8) For Current Contract Characteristics, show for current and immediately
preceding Collection Periods. Original Contract Characteristics do not
change.
<PAGE>
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
MONTHLY SERVICING REPORT
DETERMINATION DATE: PAYMENT DATE:
COLLECTION PERIOD:
VI. PURCHASED, LIQUIDATED AND PAID CONTRACTS
1. The following list includes the account number for each Contract
which, during the Collection Period to which this report relates, was
(i) purchased by TCC, (ii) designated as a Liquidated Contract or
(iii) paid in full (either due to a prepayment or at maturity):
[Insert list]
<PAGE>
EXHIBIT C-1
REGISTERED $________________/*
No. [ ]
SEE REVERSE FOR CERTAIN DEFINITIONS
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.
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
______% RECEIVABLE-BACKED NOTE, CLASS A-[1][2][3][4]
Capita Equipment Receivables Trust 1996-1, a trust organized and
existing under the laws of the State of New York (herein referred to as the
"Issuer"), for value received, hereby promises to pay to [
], or registered assigns, the principal sum of [
] payable on each Payment Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is $__________
[INSERT INITIAL PRINCIPAL AMOUNT OF NOTE] and the denominator of which is
$__________ [INSERT INITIAL CLASS A-[1][2][3][4] PRINCIPAL BALANCE] by (ii) the
aggregate amount, if any, payable from the Note Distribution Account in respect
of principal on the Class A-[1][2][3][4] Notes pursuant to Section 8.04(b)(ii)
of the Indenture hereinafter referred to; PROVIDED, HOWEVER, that the entire
unpaid principal amount of this Note shall be due and payable on the earliest of
the Payment Date occurring in _________________ (the "Class A-[1][2][3][4]
Stated Maturity Date") and the Redemption Date, if any, pursuant to Section
10.01(a) or (b) of
- -----------------------
*Denominations of $10,000 and integral multiples thereof.
C-1-1
<PAGE>
the Indenture. The Issuer will pay interest on this Note on each Payment Date
in an amount equal to one-twelfth of the product of (i) the rate per annum shown
above and (ii) 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) or, with respect to the first Payment Date, the original
principal amount of this Note. Such principal of and interest on this Note
shall be paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
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 Trustee whose name appears below by manual signature, this Note shall not be
entitled to any benefit under the Indenture, 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.
Date: CAPITA EQUIPMENT RECEIVABLES TRUST
1996-1
By THE BANK OF NEW YORK
not in its individual capacity but solely as Owner Trustee under the Trust
Agreement,
By
--------------------------------
Name:
Title:
C-1-2
<PAGE>
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
not in its individual capacity but
solely as Trustee,
By
-------------------------------
Authorized Signatory
C-1-3
<PAGE>
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer
(herein called the "Notes"), issued in five classes designated as its %
Receivable-Backed Notes, Class A-1, % Receivable-Backed Notes, Class A-2,
% Receivable-Backed Notes, Class A-3, % Receivable-Backed Notes,
Class A-4, and % Receivable-Backed Notes, Class B, respectively, all
issued under an Indenture dated as of October 1, 1996 (such indenture, as
supplemented or amended, herein called the "Indenture"), between the Issuer and
The Chase Manhattan Bank, as trustee (the "Trustee," which term includes any
successor 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 Trustee and the Holders of
the Notes. The Notes are subject to all terms of the Indenture. All terms used
in this Note that are defined in the Indenture, as supplemented or amended,
shall have the meanings assigned to them in or pursuant to the Indenture, as so
supplemented or amended.
The Notes are and will be secured by the collateral pledged as
security therefor as provided in the Indenture.
Principal of the Class A-[1][2][3][4] Notes will be payable on each
Payment Date in an amount described on the face hereof. "PAYMENT DATE" means
the fifteenth day of each month, or, if any such date is not a Business Day, the
next succeeding Business Day, commencing in November 1996.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the earliest of the Class A-[1][2][3][4] Stated
Maturity Date and the Redemption Date, if any, pursuant to Section 10.01(a) or
10.01(b) of the Indenture. Notwithstanding the foregoing, the entire unpaid
principal amount of the Notes shall be due and payable on the date on which an
Event of Default shall have occurred and be continuing and the Trustee or a Note
Majority have declared the Notes to be immediately due and payable in the manner
provided in Section 5.02 of the Indenture. All principal payments on the Class
A-[1][2][3][4] Notes shall be made pro rata to the Class A-[1][2][3][4]
Noteholders entitled thereto.
Payments of interest on this Note due and payable on each Payment
Date, together with the installment of principal, if any, to the extent not in
full payment of this Note, shall be made by check mailed to the Person whose
name appears as the Registered Holder of this Note (or one or more Predecessor
Notes) on the Note Register as of the close of business on each Record Date,
except that with respect to Notes registered on the Record Date in the name of
the nominee of the Depository (initially, such nominee to be Cede & Co.),
payments will be made by wire transfer in immediately available funds to the
account designated by such nominee. Such checks shall be mailed to the Person
entitled thereto at the address of such Person as it appears on the Note
Register as of the applicable Record Date without requiring that this Note
C-1-4
<PAGE>
be submitted for notation of payment. Any reduction in the principal amount of
this Note (or any one or more Predecessor Notes) affected by any payments made
on any Payment Date shall be binding upon all future Holders of this Note and of
any Note issued upon the registration of transfer hereof or in exchange hereof
or in lieu hereof, whether or not noted hereon. If funds are expected to be
available, as provided in the Indenture, for payment in full of the then
remaining unpaid principal amount of this Note on a Payment Date, then the
Trustee, in the name of and on behalf of the Issuer, will notify the Person who
was the Registered Holder hereof as of the Record Date with respect to the
Payment Date immediately preceding such Redemption Date by notice mailed within
five days of such Redemption Date and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Trustee's
principal Corporate Trust Office or at the office of the Trustee's agent
appointed for such purposes located in The City of New York.
The Issuer shall pay interest on overdue installments of interest at
the Class A-[1][2][3][4] Interest Rate to the extent lawful.
As provided in the Indenture, the Notes may be redeemed pursuant to
Section 10.01(a) of the Indenture, in whole, but not in part, at the option of
the Depositor on any Payment Date on or after the date on which the sum of the
Aggregate Principal Balance of the Notes and the Equity Certificate Balance is
less than or equal to 10% of the Cut-Off Date Contract Pool Principal Balance.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or agency
designated by the Issuer pursuant to the Indenture, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by, the Holder hereof or his 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 a "signature guarantee program" determined by the
Note Registrar in accordance with the Exchange Act, and such other documents as
the Trustee may require, and thereupon one or more new Notes of authorized
denominations and in the same aggregate principal amount will be issued to the
designated transferee or transferees. No service charge will be charged for any
registration of transfer or exchange of this Note, but the transferor may be
required to pay a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any such registration of transfer or
exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Trustee on the Notes or under the
Indenture or any certificate or other writing delivered in connection therewith,
against (i) the Trustee or the Owner Trustee in its individual capacity, (ii)
any owner of a beneficial interest in the Issuer or
C-1-5
<PAGE>
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Trustee or of any
successor or assign of the Trustee or the Owner Trustee in its individual
capacity, except as any such Person may have expressly agreed and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution or failure to pay any installment or call owing to such
entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that by
accepting the benefits of the Indenture and such Note that such Noteholder or
Note Owner will not at any time institute against the Depositor or the Issuer,
or join in any institution against the Depositor or the Issuer, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Notes, the Indenture or the Related Documents.
The Depositor has structured the Trust Agreement, the Indenture, the
Cash Collateral Account Agreement, the Notes and the Equity Certificates with
the intention that the Notes will qualify under applicable federal, state, local
and foreign tax law as indebtedness of the Depositor secured by the Contracts.
The Depositor, the Servicer, each Noteholder and each Note Owner agree to treat
and to take no action inconsistent with the treatment of the Notes as such
indebtedness for purposes of federal, state, local and foreign income or
franchise taxes and any other tax imposed on or measured by income. Each
Noteholder and each Note Owner, by acceptance of its Note or beneficial interest
therein, agrees to be bound by the provisions of this paragraph. Each
Noteholder agrees that it will cause any Note Owner acquiring an interest in a
Note through it to comply with the Indenture as to treatment as indebtedness
under applicable tax law, as described in this paragraph.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the Person in whose name this Note (as of the day of determination or as
of such other date as may be specified in the Indenture) is registered as the
owner hereof for all purposes, whether or not this Note be overdue, and neither
the Issuer, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Holders of Notes representing a
majority of the Outstanding Amount of each class of Notes at the time
Outstanding. The Indenture also contains provisions permitting the Holders of
Notes representing specified percentages of the Outstanding Amount of each class
of Notes, on behalf of the Holders of all the Notes, to
C-1-6
<PAGE>
waive compliance by the Issuer with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Note (or any one or more Predecessor
Notes) shall be conclusive and binding upon such Holders and upon all future
Holders of this Note and of any Note issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof whether or not notation of such
consent or waiver is made upon this Note. The Indenture also permits the
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain circumstances,
to merge or consolidate, subject to the rights of the Trustee and the Holder of
Notes under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place, and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Related Documents, neither The Bank of New York in its
individual capacity, any owner of a beneficiary interest in the Issuer, nor any
of their respective partners, beneficiaries, agents, officers, directors,
employees or 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 Owner Trustee for the sole purpose of binding the interests of the Owner
Trustee in the assets of the Issuer. The Holder of this Note by the acceptance
hereof agrees that except as expressly provided in the Related Documents, in the
case of an Event of Default under the Indenture, the Holder 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.
C-1-7
<PAGE>
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:
-----------------------------------
- -----------------------------------
- -------------------
** 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.
C-1-8
<PAGE>
EXHIBIT C-2
REGISTERED $_______________/*
No. [ ]
SEE REVERSE FOR CERTAIN DEFINITIONS
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.
THIS NOTE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A-1 NOTES,
THE CLASS A-2 NOTES, THE CLASS A-3 NOTES AND THE CLASS A-4 NOTES, AS DESCRIBED
IN THE INDENTURE REFERRED TO HEREIN.
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
______% RECEIVABLE-BACKED NOTE, CLASS B
Capita Equipment Receivables Trust 1996-1, a trust organized and
existing under the laws of the State of New York (herein referred to as the
"Issuer"), for value received, hereby promises to pay to [
], or registered assigns, the principal sum of [
] payable on each Payment Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is $__________
[INSERT INITIAL PRINCIPAL AMOUNT OF NOTE] and the denominator of which is
$__________ [INSERT INITIAL CLASS B PRINCIPAL BALANCE] by (ii) the aggregate
amount, if any, payable from the Note Distribution Account in respect of
principal on the Class B Notes pursuant to Section 8.04(b)(ii) of
- ------------------------
*Denominations of $10,000 and integral multiples thereof.
C-2-1
<PAGE>
the Indenture hereinafter referred to; PROVIDED, HOWEVER, that the entire unpaid
principal amount of this Note shall be due and payable on the earliest of the
Payment Date occurring in _____________________ (the "Class B Stated Maturity
Date") and the Redemption Date, if any, pursuant to Section 10.01(a) or (b) of
the Indenture. The Issuer will pay interest on this Note on each Payment Date
in an amount equal to one-twelfth of the product of (i) the rate per annum shown
above and (ii) 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) or, with respect to the first Payment Date, the original
principal amount of this Note. Such principal of and interest on this Note
shall be paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
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 Trustee whose name appears below by manual signature, this Note shall not be
entitled to any benefit under the Indenture, 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.
Date: CAPITA EQUIPMENT RECEIVABLES TRUST
1996-1
By THE BANK OF NEW YORK
not in its individual capacity but solely as Owner Trustee under the Trust
Agreement,
By
-------------------------------
Name:
Title:
C-2-2
<PAGE>
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
not in its individual capacity but
solely as Trustee,
By
------------------------------
Authorized Signatory
C-2-3
<PAGE>
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer
(herein called the "Notes"), issued in five classes designated as its _______%
Receivable-Backed Notes, Class A-1, _______% Receivable-Backed Notes, Class A-2,
_______% Receivable-Backed Notes, Class A-3, _______% Receivable-Backed Notes,
Class A-4, and _______% Receivable-Backed Notes, Class B, respectively, all
issued under an Indenture dated as of October 1, 1996 (such indenture, as
supplemented or amended, herein called the "Indenture"), between the Issuer and
The Chase Manhattan Bank, as trustee (the "Trustee," which term includes any
successor 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 Trustee and the Holders of
the Notes. The Notes are subject to all terms of the Indenture. All terms used
in this Note that are defined in the Indenture, as supplemented or amended,
shall have the meanings assigned to them in or pursuant to the Indenture, as so
supplemented or amended.
The Notes are and will be secured by the collateral pledged as
security therefor as provided in the Indenture.
Principal of the Class B Notes will be payable on each Payment Date in
an amount described on the face hereof. "PAYMENT DATE" means the fifteenth day
of each month, or, if any such date is not a Business Day, the next succeeding
Business Day, commencing in November 1996.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the earliest of the Class B Stated Maturity Date and
the Redemption Date, if any, pursuant to Section 10.01(a) or 10.01(b) of the
Indenture. Notwithstanding the foregoing, the entire unpaid principal amount of
the Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Trustee or a Note Majority have
declared the Notes to be immediately due and payable in the manner provided in
Section 5.02 of the Indenture. All principal payments on the Class B Notes
shall be made pro rata to the Class B Noteholders entitled thereto.
Payments of interest on this Note due and payable on each Payment
Date, together with the installment of principal, if any, to the extent not in
full payment of this Note, shall be made by check mailed to the Person whose
name appears as the Registered Holder of this Note (or one or more Predecessor
Notes) on the Note Register as of the close of business on each Record Date,
except that with respect to Notes registered on the Record Date in the name of
the nominee of the Depository (initially, such nominee to be Cede & Co.),
payments will be made by wire transfer in immediately available funds to the
account designated by such nominee. Such checks shall be mailed to the Person
entitled thereto at the address of such Person as it appears on the Note
Register as of the applicable Record Date without requiring that this Note
C-2-4
<PAGE>
be submitted for notation of payment. Any reduction in the principal amount of
this Note (or any one or more Predecessor Notes) affected by any payments made
on any Payment Date shall be binding upon all future Holders of this Note and of
any Note issued upon the registration of transfer hereof or in exchange hereof
or in lieu hereof, whether or not noted hereon. If funds are expected to be
available, as provided in the Indenture, for payment in full of the then
remaining unpaid principal amount of this Note on a Payment Date, then the
Trustee, in the name of and on behalf of the Issuer, will notify the Person who
was the Registered Holder hereof as of the Record Date with respect to the
Payment Date immediately preceding such Redemption Date by notice mailed within
five days of such Redemption Date and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Trustee's
principal Corporate Trust Office or at the office of the Trustee's agent
appointed for such purposes located in The City of New York.
The Issuer shall pay interest on overdue installments of interest at
the Class B Interest Rate to the extent lawful.
As provided in the Indenture, the Notes may be redeemed pursuant to
Section 10.01(a) of the Indenture, in whole, but not in part, at the option of
the Depositor on any Payment Date on or after the date on which the sum of the
Aggregate Principal Balance of the Notes and the Equity Certificate Balance is
less than or equal to 10% of the Cut-Off Date Contract Pool Principal Balance.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or agency
designated by the Issuer pursuant to the Indenture, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by, the Holder hereof or his 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 a "signature guarantee program" determined by the
Note Registrar in accordance with the Exchange Act, and such other documents as
the Trustee may require, and thereupon one or more new Notes of authorized
denominations and in the same aggregate principal amount will be issued to the
designated transferee or transferees. No service charge will be charged for any
registration of transfer or exchange of this Note, but the transferor may be
required to pay a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any such registration of transfer or
exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Trustee on the Notes or under the
Indenture or any certificate or other writing delivered in connection therewith,
against (i) the Trustee or the Owner Trustee in its individual capacity, (ii)
any owner of a beneficial interest in the Issuer or
C-2-5
<PAGE>
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Trustee or of any
successor or assign of the Trustee or the Owner Trustee in its individual
capacity, except as any such Person may have expressly agreed and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution or failure to pay any installment or call owing to such
entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that by
accepting the benefits of the Indenture and such Note that such Noteholder or
Note Owner will not at any time institute against the Depositor or the Issuer,
or join in any institution against the Depositor or the Issuer, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Notes, the Indenture or the Related Documents.
The Depositor has structured the Trust Agreement, the Indenture, the
Cash Collateral Account Agreement, the Notes and the Equity Certificates with
the intention that the Notes will qualify under applicable federal, state, local
and foreign tax law as indebtedness of the Depositor secured by the Contracts.
The Depositor, the Servicer, each Noteholder and each Note Owner agree to treat
and to take no action inconsistent with the treatment of the Notes as such
indebtedness for purposes of federal, state, local and foreign income or
franchise taxes and any other tax imposed on or measured by income. Each
Noteholder and each Note Owner, by acceptance of its Note or beneficial interest
therein, agrees to be bound by the provisions of this paragraph. Each
Noteholder agrees that it will cause any Note Owner acquiring an interest in a
Note through it to comply with the Indenture as to treatment as indebtedness
under applicable tax law, as described in this paragraph.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the Person in whose name this Note (as of the day of determination or as
of such other date as may be specified in the Indenture) is registered as the
owner hereof for all purposes, whether or not this Note be overdue, and neither
the Issuer, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Holders of Notes representing a
majority of the Outstanding Amount of each class of Notes at the time
Outstanding. The Indenture also contains provisions permitting the Holders of
Notes representing specified percentages of the Outstanding Amount of each class
of Notes, on behalf of the Holders of all the Notes, to
C-2-6
<PAGE>
waive compliance by the Issuer with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Note (or any one or more Predecessor
Notes) shall be conclusive and binding upon such Holders and upon all future
Holders of this Note and of any Note issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof whether or not notation of such
consent or waiver is made upon this Note. The Indenture also permits the
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain circumstances,
to merge or consolidate, subject to the rights of the Trustee and the Holder of
Notes under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place, and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Related Documents, neither The Bank of New York in its
individual capacity, any owner of a beneficiary interest in the Issuer, nor any
of their respective partners, beneficiaries, agents, officers, directors,
employees or 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 Owner Trustee for the sole purpose of binding the interests of the Owner
Trustee in the assets of the Issuer. The Holder of this Note by the acceptance
hereof agrees that except as expressly provided in the Related Documents, in the
case of an Event of Default under the Indenture, the Holder 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.
C-2-7
<PAGE>
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:
-----------------------------------
- -----------------------------------
- ------------------
** 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.
C-2-8
<PAGE>
Exhibit 4.3
- ------------------------------------------------------
- ------------------------------------------------------
AMENDED AND RESTATED
TRUST AGREEMENT
BETWEEN
ANTIGUA FUNDING CORPORATION
AND
THE BANK OF NEW YORK
OWNER TRUSTEE
---------------------------
DATED AS OF OCTOBER 1, 1996
---------------------------
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
- ------------------------------------------------------
- ------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . 1
Section 1.1. Definitions . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Usage of Terms. . . . . . . . . . . . . . . . . . . 3
Section 1.3. Calculations. . . . . . . . . . . . . . . . . . . . 4
Section 1.4. Section References. . . . . . . . . . . . . . . . . 4
Section 1.5. Action by or Consent of Equity Certificateholders . 4
ARTICLE II CREATION OF TRUST . . . . . . . . . . . . . . . . . 4
Section 2.1. Creation of Trust . . . . . . . . . . . . . . . . . 4
Section 2.2. Office. . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.3. Purposes and Powers . . . . . . . . . . . . . . . . 5
Section 2.4. Trust May Consolidate or Merge Only on Certain Terms 6
Section 2.5. Appointment of Owner Trustee. . . . . . . . . . . . 6
Section 2.6. Initial Capital Contribution of Trust Estate. . . . 6
Section 2.7. Declaration of Trust. . . . . . . . . . . . . . . . 6
Section 2.8. Liability of the Depositor. . . . . . . . . . . . . 6
Section 2.9. Representations and Warranties of the Depositor . . 7
Section 2.10. Covenants of the Depositor. . . . . . . . . . . . . 8
Section 2.11. Covenants of the Equity Certificateholders. . . . . 12
ARTICLE III THE EQUITY CERTIFICATES . . . . . . . . . . . . . . 12
Section 3.1. Initial Ownership . . . . . . . . . . . . . . . . . 12
Section 3.2. The Equity Certificates; Authorized Denominations . 12
Section 3.3. Authentication of Equity Certificates . . . . . . . 13
Section 3.4. Registration of Transfer and Exchange of Equity
Certificates. . . . . . . . . . . . . . . . . . . . 13
Section 3.5. Mutilated, Destroyed, Lost or Stolen Equity
Certificates. . . . . . . . . . . . . . . . . . . . 15
Section 3.6. Persons Deemed Owners . . . . . . . . . . . . . . . 15
Section 3.7. Access to List of Equity Certificateholders' Names
and Addresses . . . . . . . . . . . . . . . . . . . 16
Section 3.8. Maintenance of Office or Agency . . . . . . . . . . 16
Section 3.9. Appointment of Paying Agent . . . . . . . . . . . . 16
ARTICLE IV ACTIONS BY OWNER TRUSTEE. . . . . . . . . . . . . . 17
Section 4.1. Restriction on Power of Equity Certificateholders . 17
Section 4.2. Prior Notice to Equity Certificateholders with
Respect to Certain Matters. . . . . . . . . . . . . 17
Section 4.3. Action by Equity Certificateholders with Respect
to Bankruptcy . . . . . . . . . . . . . . . . . . . 18
Section 4.4. Restrictions on Equity Certificateholders' Power. . 18
-i-
<PAGE>
ARTICLE V APPLICATION OF TRUST FUNDS; CERTAIN DUTIES. . . . . 19
Section 5.1. Trust Accounts. . . . . . . . . . . . . . . . . . . 19
Section 5.2. Application of Funds in the Equity Certificate
Distribution Account. . . . . . . . . . . . . . . . 20
Section 5.3. Method of Payment . . . . . . . . . . . . . . . . . 22
Section 5.4. No Segregation of Monies; No Interest . . . . . . . 22
ARTICLE VI AUTHORITY AND DUTIES OF OWNER TRUSTEE . . . . . . . 23
Section 6.1. General Authority . . . . . . . . . . . . . . . . . 23
Section 6.2. General Duties. . . . . . . . . . . . . . . . . . . 23
Section 6.3. Action upon Instruction . . . . . . . . . . . . . . 23
Section 6.4. No Duties Except as Specified in this Agreement, in
Related Documents or in Instructions. . . . . . . . 24
Section 6.5. No Action Except under Specified Documents or
Instructions. . . . . . . . . . . . . . . . . . . . 25
Section 6.6. Restrictions. . . . . . . . . . . . . . . . . . . . 25
Section 6.7. Covenant of the Owner Trustee . . . . . . . . . . . 25
ARTICLE VII CONCERNING THE OWNER TRUSTEE. . . . . . . . . . . . 26
Section 7.1. Acceptance of Trust and Duties. . . . . . . . . . . 26
Section 7.2. Furnishing of Documents . . . . . . . . . . . . . . 27
Section 7.3. Representations and Warranties. . . . . . . . . . . 27
Section 7.4. Reliance; Advice of Counsel . . . . . . . . . . . . 28
Section 7.5. Not Acting in Individual Capacity . . . . . . . . . 29
Section 7.6. Owner Trustee Not Liable for Equity Certificates,
Notes or tracts . . . . . . . . . . . . . . . . . . 29
Section 7.7. Owner Trustee May Own Equity Certificates and Notes 29
ARTICLE VIII COMPENSATION OF OWNER TRUSTEE . . . . . . . . . . . 29
Section 8.1. Owner Trustee's Fees and Expenses . . . . . . . . . 29
Section 8.2. Indemnification . . . . . . . . . . . . . . . . . . 30
Section 8.3. Non-recourse Obligations. . . . . . . . . . . . . . 30
ARTICLE IX TERMINATION . . . . . . . . . . . . . . . . . . . . 30
Section 9.1. Termination of the Trust. . . . . . . . . . . . . . 30
ARTICLE X SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER
TRUSTEES. . . . . . . . . . . . . . . . . . . . . . . 33
Section 10.1. Eligibility Requirements for Owner Trustee. . . . . 33
Section 10.2. Resignation or Removal of Owner Trustee . . . . . . 33
Section 10.3. Successor Owner Trustee . . . . . . . . . . . . . . 34
Section 10.4. Merger or Consolidation of Owner Trustee. . . . . . 35
Section 10.5. Appointment of Co-Trustee or Separate Trustee . . . 35
-ii-
<PAGE>
ARTICLE XI MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . . 36
Section 11.1. Amendment . . . . . . . . . . . . . . . . . . . . . 36
Section 11.2. GOVERNING LAW . . . . . . . . . . . . . . . . . . . 38
Section 11.3. Severability of Provisions. . . . . . . . . . . . . 38
Section 11.4. Equity Certificates Nonassessable and Fully Paid. . 38
Section 11.5. Third-Party Beneficiaries . . . . . . . . . . . . . 38
Section 11.6. Counterparts. . . . . . . . . . . . . . . . . . . . 38
Section 11.7. Notices . . . . . . . . . . . . . . . . . . . . . . 38
-iii-
<PAGE>
EXHIBITS
Exhibit A -- Form of Equity Certificate
Exhibit B -- Form of Representation Letter
<PAGE>
THIS AMENDED AND RESTATED TRUST AGREEMENT, dated as of October 1,
1996, is made between Antigua Funding Corporation, a Delaware corporation (the
"Depositor"), and The Bank of New York, a New York banking corporation, as Owner
Trustee (in such capacity, the "Owner Trustee").
In consideration of the mutual agreements herein contained, and of
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. DEFINITIONS. All terms defined in the Indenture and the
Transfer and Servicing Agreement (each as defined below) shall have the same
meaning in this Agreement. Whenever capitalized and used in this Agreement, the
following words and phrases, unless otherwise specified, shall have the
following meanings:
ACT: The meaning assigned in Section 3.4(g).
AGREEMENT OR "THIS AGREEMENT": This Amended and Restated Trust
Agreement, all amendments and supplements thereto and all exhibits and schedules
to any of the foregoing.
APPLICANTS: The meaning assigned in Section 3.7.
AUTHENTICATION AGENT: The Bank of New York, or its successor in
interest, and any successor authentication agent appointed as provided in this
Agreement.
BENEFIT PLAN: The meaning assigned in Section 3.4(f).
CERTIFICATE REGISTER AND CERTIFICATE REGISTRAR: The register
maintained and the registrar appointed pursuant to Section 3.4(a).
CODE: The Internal Revenue Code of 1986, as amended.
CORPORATE TRUST OFFICE: The principal office of the Owner Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the Closing Date is located at 101 Barclay Street, Floor 12
East, New York, New York 10286, Attention: Corporate Trust
Administration--Asset Backed Unit; the telecopy number for the Corporate Trust
Office on the date of the execution of this Agreement is (212) 815-5544.
DEPOSITOR: Antigua Funding Corporation, a Delaware corporation, in
its capacity as depositor hereunder.
<PAGE>
EQUITY CERTIFICATE DISTRIBUTION ACCOUNT: The account designated as
the Equity Certificate Distribution Account in, and which is established and
maintained pursuant to, Section 5.1.
EQUITY CERTIFICATE: A certificate executed by the Owner Trustee
evidencing a beneficial ownership interest in the Trust, substantially in the
form attached hereto as Exhibit A.
EQUITY CERTIFICATE BALANCE: As of any date, $127,509,329 minus all
distributions in respect of principal on the Equity Certificates prior to such
date.
EQUITY CERTIFICATE MAJORITY: The meaning assigned in Section 1.5(a).
EQUITY CERTIFICATEHOLDER: A Person in whose name an Equity
Certificate is registered in the Certificate Register.
ERISA: The meaning assigned to such term in Section 3.4(f).
EXPENSES: The meaning assigned to such term in Section 8.2.
INDEMNIFIED PARTIES: The meaning assigned to such term in Section
8.2.
INDENTURE: The Indenture, dated as of October 1, 1996, between the
Trust and The Chase Manhattan Bank, as Indenture Trustee, as the same may be
amended and supplemented from time to time.
N.Y. UCC: The UCC as in effect in the State of New York from time to
time.
OWNER TRUSTEE: The Bank of New York, or its successor in interest,
acting not individually but solely as trustee, and any successor trustee
appointed as provided in this Agreement.
PAYING AGENT: Any paying agent or co-paying agent appointed pursuant
to Section 3.9, which initially shall be the Owner Trustee.
RECORD DATE: With respect to any Payment Date or Redemption Date, the
close of business on the last Business Day immediately preceding such Payment
Date or Redemption Date.
RELATED DOCUMENTS: This Agreement, the Notes, the Equity
Certificates, the Transfer and Servicing Agreement, the Indenture, the Purchase
Agreement, the Cash Collateral Account Agreement, the Depository Agreements, the
Revolving Trust Agreement, and the underwriting agreements among the Depositor,
TCC and the underwriters of the Notes. The Related Documents executed by any
party are referred
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to herein as "such party's Related Documents," "its Related Documents" or by a
similar expression.
RESPONSIBLE OFFICER: When used with respect to the Owner Trustee, the
President, any Vice President or any Trust Officer, or any other officer or
employee having similar functions.
REVOLVING TRUST TRUSTEE: The First National Bank of Chicago or its
successor as Trustee under the Revolving Trust Agreement.
REVOLVING TRUST AGREEMENT: The Trust Agreement, dated as of October
15, 1996, among Antigua Funding Corporation, as depositor, AT&T Capital
Corporation, as administrator, The First National Bank of Chicago, as collateral
agent, and The First National Bank of Chicago, as Trustee, relating to Capita
Revolving Trust 1996-1.
TRANSFER AND SERVICING AGREEMENT: The Transfer and Servicing
Agreement, dated as of October 1, 1996, among the Trust, the Depositor, TCC, in
its individual capacity and as Servicer, and The Chase Manhattan Bank, as
trustee under the Indenture, as the same may be amended and supplemented from
time to time.
TRUST: The trust created by this Agreement, the estate of which
consists of the Trust Assets.
TRUST ACCOUNTS: The Equity Certificate Distribution Account, and such
other accounts as may be established in the name of the Trust pursuant to the
Indenture or the Transfer and Servicing Agreement.
TRUST ASSETS: The property and proceeds of every description conveyed
pursuant to Section 2.6 hereof and Section 2.1 of the Transfer and Servicing
Agreement, together with the Trust Accounts (including all Eligible Investments
therein and all proceeds therefrom) and the right to withdraw funds from the
Cash Collateral Account pursuant to Section 8.06 of the Indenture.
Section 1.2. USAGE OF TERMS. With respect to all terms used in this
Agreement, the singular includes the plural and the plural the singular; words
importing any gender include the other genders; references to "writing" include
printing, typing, lithography, and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement; references to
Persons include their permitted successors and assigns; and the terms "include"
or "including" mean "include without limitation" or "including without
limitation."
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Section 1.3. CALCULATIONS. All calculations of the amount of
interest accrued on the Equity Certificates shall be made on the basis of a
360-day year consisting of twelve 30-day months.
Section 1.4. SECTION REFERENCES. All references to Articles,
Sections, paragraphs, subsections, exhibits and schedules shall be to such
portions of this Agreement unless otherwise specified.
Section 1.5. ACTION BY OR CONSENT OF EQUITY CERTIFICATEHOLDERS.
(a) Except as expressly provided herein, any action that may be taken
by the Equity Certificateholders under this Agreement may be taken by the
Holders of Equity Certificates evidencing not less than a majority of the
Equity Certificate Balance at the time of such action (an "Equity
Certificate Majority"). Except as expressly provided herein, any written
notice or consent of the Equity Certificateholders delivered pursuant to
this Agreement shall be effective at the time of the delivery of such
notice if signed by an Equity Certificate Majority.
(b) Whenever any provision of this Agreement refers to action to be
taken, or consented to, by Equity Certificateholders, such provision shall
be deemed to refer to Equity Certificateholders of record as of the Record
Date immediately preceding the date on which such action is to be taken, or
consent given, by Equity Certificateholders.
Section 1.6. NO RECOURSE. Each Equity Certificateholder by accepting
an Equity Certificate acknowledges that such Equity Certificateholder's Equity
Certificates represent beneficial interests in the Trust only and do not
represent interests in or obligations of the Depositor, the Servicer, the Owner
Trustee, the Indenture Trustee or any Affiliate of any of the foregoing and no
recourse may be had against such parties or their assets, except as may be
expressly set forth or contemplated in this Agreement, the Equity Certificates
or the Related Documents.
ARTICLE II
CREATION OF TRUST
Section 2.1. CREATION OF TRUST. There is hereby formed a trust to be
known as "Capita Equipment Receivables Trust 1996-1."
Section 2.2. OFFICE. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address as the
Owner Trustee may designate by written notice to the Equity Certificateholders,
the Depositor, and the Indenture Trustee.
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Section 2.3. PURPOSES AND POWERS. The purpose of the Trust is, and
the Trust shall have the power and authority, to engage in the following
activities:
(i) to issue the Notes pursuant to the Indenture and to sell the
Notes in the manner directed by the Depositor;
(ii) to issue the Equity Certificates to or upon the order of the
Depositor, pursuant to this Agreement;
(iii) with the proceeds of the sale of the Notes, to pay the
organizational, start-up and transactional expenses of the Trust (if and to
the extent not paid by the Depositor pursuant to Section 2.6); and to
acquire the Contracts and the other items conveyed pursuant to the Transfer
and Servicing Agreement;
(v) to assign, grant, transfer, pledge, mortgage and convey any
or all of the Trust Assets to the Indenture Trustee pursuant to the
Indenture for the benefit of the Noteholders;
(vi) to hold, manage and distribute to the Equity
Certificateholders any portion of the Trust Assets released from the Lien
of, and remitted to the Trust pursuant to, the Indenture and to distribute
to the Equity Certificateholders any other portion of the Trust Assets in
the manner prescribed by the Transfer and Servicing Agreement, the
Indenture and the Cash Collateral Account Agreement;
(vii) to enter into and perform its obligations under the Transfer
and Servicing Agreement and the other Related Documents to which it is to
be a party;
(viii) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish the
foregoing or are incidental thereto or connected therewith; and
(ix) subject to compliance with the Related Documents, to engage
in such other activities as may be required in connection with conservation
of the Trust Assets and the making of distributions to the Equity
Certificateholders and the Noteholders.
The Owner Trustee is hereby authorized to engage in the foregoing activities on
behalf of the Trust. The Depositor is hereby authorized to execute any
registration statements, applications or other documents on behalf of the Trust
that are necessary, suitable or convenient to accomplish the foregoing. The
Owner Trustee, on behalf of the Trust, shall not engage in any activity other
than in connection with the foregoing or other than as required or expressly
authorized by the terms of this Agreement or the Related Documents.
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Section 2.4. TRUST MAY CONSOLIDATE OR MERGE ONLY ON CERTAIN TERMS.
(a) The Trust shall not consolidate or merge with or into any other
Person, unless the conditions specified in Section 3.10(a) of the Indenture have
been satisfied.
(b) The Trust shall not convey or transfer all or substantially all
of its properties or assets, including those included in the Trust Estate under
the Indenture, to any Person (except as expressly permitted by the Indenture or
the Transfer and Servicing Agreement), unless the conditions specified in
Section 3.10(b) of the Indenture have been satisfied.
Section 2.5. APPOINTMENT OF OWNER TRUSTEE. The Depositor hereby
appoints the Owner Trustee as trustee of the Trust effective as of the date
hereof, to have all the rights, powers and duties set forth herein, and the
Owner Trustee hereby accepts such appointment.
Section 2.6. INITIAL CAPITAL CONTRIBUTION OF TRUST ESTATE. The
Depositor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, as of the date hereof, the sum of $10. The Owner Trustee hereby
acknowledges receipt in trust from the Depositor, as of the date hereof, of the
foregoing contribution, which shall constitute the initial Trust Assets and
shall be deposited in the Equity Certificate Distribution Account. The
Depositor shall pay organizational expenses of the Trust as they may arise or
shall, upon the request of the Owner Trustee, promptly reimburse the Owner
Trustee for any such expenses paid by the Owner Trustee.
Section 2.7. DECLARATION OF TRUST. The Owner Trustee hereby declares
that it will hold the Trust Assets in trust upon and subject to the conditions
set forth herein for the use and benefit of the Equity Certificateholders,
subject to the interests and rights in the Trust Assets granted to other Persons
by the Related Documents.
Section 2.8. LIABILITY OF THE DEPOSITOR.
(a) The Depositor shall be liable directly to indemnify each injured
party for all losses, claims, damages, liabilities and expenses of the Trust, to
the extent not paid out of the Trust Assets, PROVIDED, HOWEVER, that the
Depositor shall not be liable for any losses incurred by an Equity
Certificateholder in the capacity of an investor in the Equity Certificates or a
Note Owner in the capacity of an investor in the Notes; PROVIDED, FURTHER, that
the Depositor shall not be liable to indemnify any injured party if such party
has agreed that its recourse against the Trust for any obligation or liability
of the Trust to such party shall be limited to the assets of the Trust. In
addition, any third party creditors of the Trust (other than in connection with
the obligations described in the provisos to the preceding sentence for which
the Depositor shall not be liable) shall be deemed third party beneficiaries of
this paragraph.
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(b) The Depositor, other than to the extent set forth in paragraph
(a), shall not have any personal liability for any liability or obligation of
the Trust or by reason of any action taken by the parties to this Agreement
pursuant to any provisions of this Agreement or any Related Document.
Section 2.9. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR. By
execution of this Agreement, the Depositor makes the following representations
and warranties on which the Owner Trustee relies in accepting the Trust Assets
in trust and issuing the Notes and Equity Certificates.
(a) ORGANIZATION AND GOOD STANDING. It has been duly organized and
is validly existing as a corporation in good standing under the laws of the
State of Delaware, with power and authority to own its properties and to
conduct its business as such properties are currently owned and as such
business is currently conducted and is proposed to be conducted pursuant to
this Agreement and the Related Documents.
(b) DUE QUALIFICATION. It is duly qualified to do business as a
foreign corporation in good standing, and has obtained all necessary
licenses and approvals, in all jurisdictions in which the ownership or
lease of its property, the conduct of its business and the performance of
its obligations under this Agreement and the Related Documents requires
such qualification.
(c) POWER AND AUTHORITY. It has the power and authority to execute
and deliver this Agreement and its Related Documents and to perform its
obligations pursuant thereto (including but not limited to the transfer of
the Contracts to the Trust); and the execution, delivery and performance of
this Agreement and its Related Documents have been duly authorized by all
necessary corporate action.
(d) NO CONSENT REQUIRED. No consent, license, approval or
authorization of, or registration or declaration with, any Person or any
governmental authority, bureau or agency is required to be obtained by the
Depositor in connection with the execution, delivery or performance of this
Agreement and the Depositor's Related Documents, except for such as have
been obtained, effected or made.
(e) NO VIOLATION. The consummation of the transactions contemplated
by this Agreement and its Related Documents and the fulfillment of its
obligations under this Agreement and its Related Documents will not
conflict with, result in any breach of any of the terms and provisions of
or constitute (with or without notice, lapse of time or both) a default
under, its certificate of incorporation or by-laws, or any indenture,
agreement, mortgage, deed of trust or other instrument to which it is a
party or by which it is bound, or result in the creation or imposition of
any Lien upon any of its properties pursuant to the
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terms of any such indenture, agreement, mortgage, deed of trust or other
instrument, or violate any law, order, rule or regulation applicable to it
of any court or of any Federal or state regulatory body, administrative
agency or other governmental instrumentality having jurisdiction over it or
any of its properties.
(f) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to its knowledge, threatened against it before any court,
regulatory body, administrative agency or other tribunal or governmental
instrumentality having jurisdiction over it or its properties (A) asserting
the invalidity of this Agreement or any of the Related Documents, (B)
seeking to prevent the issuance of the Equity Certificates or the Notes or
the consummation of any of the transactions contemplated by this Agreement
or any of the Related Documents, (C) seeking any determination or ruling
that might materially and adversely affect its performance of its
obligations under, or the validity or enforceability of, this Agreement or
any of the Related Documents, or (D) seeking to adversely affect the
Federal income tax or other Federal, state or local tax attributes of the
Trust, the Notes or the Equity Certificates.
(g) PLACE OF BUSINESS. The principal executive offices of the
Depositor are in Morristown, New Jersey, and the offices where the
Depositor keeps its records concerning the Contracts and related documents
are in Morristown, New Jersey.
(h) NOT AN INVESTMENT COMPANY. The Depositor is not an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended, or is exempt from all provisions of such Act.
(i) BINDING OBLIGATIONS. This Agreement and each of the Depositor's
Related Documents constitutes the legal, valid and binding obligation of
the Depositor, enforceable against the Depositor in accordance with its
terms, except (A) as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect, affecting the enforcement of creditors' rights
in general, and (B) as such enforceability may be limited by general
principles of equity (whether considered in a suit at law or in equity).
Section 2.10. COVENANTS OF THE DEPOSITOR. The Depositor agrees and
covenants for the benefit of each Note Owner, each Equity Certificateholder and
the Owner Trustee, during the term of this Agreement, and to the fullest extent
permitted by applicable law, that:
(a) OTHER INDEBTEDNESS. It shall not create, incur or suffer to
exist any indebtedness or engage in any business, except, in each case, as
permitted by its certificate of incorporation and the Related Documents.
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(b) NON-PETITION. It shall not, for any reason, institute
proceedings for itself or the Trust to be adjudicated a bankrupt or
insolvent, or consent to the institution of bankruptcy or insolvency
proceedings against itself or the Trust, or file a petition seeking or
consenting to reorganization or relief under any applicable Federal or
state law relating to the bankruptcy of itself or the Trust, or consent to
the appointment of a receiver, liquidator, assignee, trustee, sequestrator
(or other similar official) of itself or the Trust or a substantial part of
its assets or the property of the Trust or cause or permit itself or the
Trust to make any assignment for the benefit of creditors, or admit in
writing its inability or the inability of the Trust to pay its debts
generally as they become due, or declare or effect a moratorium on the debt
of itself or the Trust or take any action in furtherance of any such
action.
(c) OTHER PARTIES. It shall obtain from each counterparty to each
Related Document to which it or the Trust is a party and each other
agreement entered into on or after the date hereof to which it or the Trust
is a party, an agreement by each such counterparty that such counterparty
shall not institute against, or join any other Person in instituting
against, it or the Trust, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other similar proceedings under
the laws of the United States or any state of the United States.
(d) NO LIENS. Except for the conveyances as provided hereunder or in
the Related Documents, the Depositor will not sell, pledge, assign or
transfer to any other Person, or grant, create, incur, assume or suffer to
exist any Lien on, any Contract or any other Trust Assets or any Equipment
(except as created by the related Contract), whether now existing or
hereafter created, and the Depositor shall defend the right, title and
interest of the Trust in, to and under the Contracts and the other Trust
Assets, whether now existing or hereafter created, and such rights,
remedies, powers and privileges, against all claims of third parties
claiming through or under the Depositor; the Depositor will immediately
notify the Trustee of the existence of any Lien on any Contract or
Equipment (except as created by the related Contract); and the Depositor
shall defend the right, title and interest of the Trust in, to and under
the Contracts and the other Trust Assets, whether now existing or hereafter
created, against all claims of third parties claiming through or under the
Depositor.
(e) ENFORCEMENT OF PURCHASE AGREEMENT. The Depositor agrees to take
all action necessary and appropriate to enforce its rights and claims under
the Purchase Agreement.
(f) SEPARATE BUSINESS. The Depositor:
(i) will (A) maintain and prepare financial reports,
financial statements, books and records and bank accounts separate
from those of
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its Affiliates and any other person or entity and (B) not permit any
Affiliate or any other person or entity independent access to its bank
accounts;
(ii) will not commingle its funds and other assets with
those of any Affiliate, any guarantor of any of the obligations of the
Depositor (each, a "Guarantor"), any Affiliate of any Guarantor or any
other person or entity;
(iii) will conduct its own business in its own name and will
hold all of its assets in its own name;
(iv) will remain solvent and pay its debts and liabilities
(including employment and overhead expenses) from its assets as the
same become due;
(v) will do all things necessary to observe corporate
formalities, and preserve its existence as a single-purpose,
bankruptcy-remote entity in accordance with the standards of the
Rating Agencies providing ratings on the Notes or the Equity
Certificates, as such standards are in effect on the date of issuance
of the Notes and the Equity Certificates;
(vi) will enter into transactions with Affiliates only if
each such transaction is commercially reasonable and on substantially
similar terms as a transaction that would be entered into on an arm's
length basis with a person or entity other than an Affiliate of the
Depositor;
(vii) will pay the salaries of its own employees from its own
funds and maintain a sufficient number of employees in light of its
contemplated business operations;
(viii) will compensate each of its consultants and agents from
its own funds for services provided to it and pay from its own assets
all obligations of any kind incurred;
(ix) will not guarantee, become obligated for, or hold
itself or its credit out to be responsible for, or available to
satisfy, the debts or obligations of any other person or entity or the
decisions or actions respecting the daily business or affairs of any
other person or entity (except as contemplated by its certificate of
incorporation and the Related Documents);
(x) will not (i) acquire obligations or securities of any
Affiliate or any of the stockholders of the Depositor or (ii) buy or
hold any evidence of indebtedness issued by any other person or
entity, other than cash,
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investment-grade securities, the Contracts and other pools of
receivables similar to the Contracts;
(xi) will allocate fairly and reasonably and pay from its
own funds the cost of (i) any overhead expenses (including paying for
any office space) shared with any Affiliate of the Depositor and (ii)
any services (such as asset management, legal and accounting) that are
provided jointly to the Depositor and one or more of its Affiliates;
(xii) will maintain and utilize separate stationery, invoices
and checks bearing its own name and allocate separate office space
(which may be a separately identified area in office space shared with
one or more Affiliates of the Depositor) and maintain a separate sign
in the office directory of the building in which the Depositor
maintains its principal place of business;
(xiii) will not make any loans or advances to, or pledge its
assets for the benefit of, any other person or entity, including,
without limitation, any Affiliate or Guarantor or any Affiliate of any
Guarantor (except as contemplated by its certificate of incorporation
and the Related Documents);
(xiv) will be, and at all times will hold itself out to the
public as, a legal entity separate and distinct from any other person
or entity;
(xv) will, in the event that any authorized officer knows of
any misunderstanding regarding the separate identity of the Depositor,
correct such misunderstanding;
(xvi) will not identify itself or any of its Affiliates as a
division or part of any other entity; and
(xvii) will maintain adequate capital for the normal
obligations reasonably foreseeable in a business of its size and
character and in light of its contemplated business operations.
(g) PURCHASE AGREEMENT NOTICES. The Depositor (i) shall promptly
give the Owner Trustee and the Indenture Trustee copies of any notices,
reports or certificates given or delivered to the Depositor under the
Purchase Agreement, (ii) shall not without the consents, approvals and
opinions, if any, required by Section 11.1, as if Section 11.1 related to
the Purchase Agreement rather than this Agreement, enter into any
amendment, supplement or other modification to, or waiver of any provision
of, the Purchase Agreement and (iii) shall not permit the removal of a
Contract from the operation of the Purchase
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Agreement unless there is a corresponding right or obligation of the
Depositor to remove such Contract from the Trust.
Section 2.11. COVENANTS OF THE EQUITY CERTIFICATEHOLDERS. Each
Equity Certificateholder by becoming an Equity Certificateholder agrees:
(a) to be bound by the terms and conditions of the Equity
Certificates of which such Holder is the beneficial owner and of this
Agreement, including any supplements or amendments hereto and to perform
the obligations of a Holder as set forth therein or herein, in all respects
as if it were a signatory hereto. This undertaking is made for the benefit
of the Trust, the Owner Trustee and all other Equity Certificateholders
present and future.
(b) not to, for any reason, institute proceedings for the Trust or
the Depositor to be adjudicated a bankrupt or insolvent, or consent to the
institution of bankruptcy or insolvency proceedings against the Trust or
the Depositor, or file a petition seeking or consenting to reorganization
or relief under any applicable Federal or state law relating to bankruptcy,
or consent to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of the Trust or the Depositor or a
substantial part of its property, or cause or permit the Trust or the
Depositor to make any assignment for the benefit of its creditors, or admit
in writing its inability to pay its debts generally as they become due, or
declare or effect a moratorium on its debt or take any action in
furtherance of any such action.
ARTICLE III
THE EQUITY CERTIFICATES
Section 3.1. INITIAL OWNERSHIP. Upon the formation of the Trust by
the contribution by the Depositor pursuant to Section 2.6 and until the issuance
of the Equity Certificates, the Depositor shall be the sole beneficiary of the
Trust.
Section 3.2. THE EQUITY CERTIFICATES; AUTHORIZED DENOMINATIONS.
(a) The Equity Certificates shall be executed on behalf of the Trust
by the Owner Trustee by manual or facsimile signature of any authorized
signatory of the Owner Trustee having such authority. Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures were affixed, authorized to sign on behalf of the Owner Trustee shall
be validly issued and entitled to the benefits of this Agreement,
notwithstanding that such individuals or any of them have ceased to be so
authorized prior to the authentication and delivery of such Equity Certificates.
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(b) On the Closing Date, one Equity Certificate, in the principal
amount of $127,509,329, shall be issued to or upon the written order of the
Depositor signed by its President or any Vice President. Unless and until the
Equity Certificate is transferred pursuant to Section 3.4(b), there shall at all
times be a single Equity Certificate. In the event of any such transfer, Equity
Certificates may thereafter be issued in denominations of $250,000 initial
principal amount and integral multiples of $1,000 thereof.
Section 3.3. Authentication of Equity Certificates. No Equity
Certificate shall entitle its holder to any benefit under this Agreement, or
shall be valid for any purpose, unless there shall appear on such Equity
Certificate a certificate of authentication substantially in the form set forth
in Exhibit A, executed by the Owner Trustee or the Authentication Agent, by
manual or facsimile signature; such authentication shall constitute conclusive
evidence that such Certificate shall have been duly authenticated and delivered
hereunder. The Owner Trustee hereby initially appoints itself as Authentication
Agent. All Equity Certificates shall be dated the date of their authentication.
Section 3.4. REGISTRATION OF TRANSFER AND EXCHANGE OF EQUITY
CERTIFICATES.
(a) The Certificate Registrar shall maintain, or cause to be
maintained, at the office or agency maintained pursuant to Section 3.8, a
Certificate Register in which, subject to such reasonable regulations as it
may prescribe, the Owner Trustee shall provide for the registration of
Equity Certificates and of transfers and exchanges of Equity Certificates
as provided in this Agreement. The Owner Trustee hereby initially appoints
itself Certificate Registrar for the purpose of registering Equity
Certificates and transfers and exchanges of Equity Certificates as provided
in this Agreement.
(b) The Depositor may transfer the Equity Certificate to the
Revolving Trust Trustee, and in connection therewith may instruct the
Certificate Registrar to register the sole Equity Certificate in the name
of the Revolving Trust Trustee or in the name of Cede & Co., as nominee of
The Depository Trust Company, provided that the Depositor has obtained an
opinion of counsel (with a copy to the Owner Trustee and the Certificate
Registrar, permitting reliance thereon by the Owner Trustee and Certificate
Registrar) to the effect that the interests in the Revolving Trust sold to
investors will be treated as debt for tax purposes (provided that no
opinion need be provided regarding the characterization of any cash
collateral account). The Equity Certificate shall not thereafter be
transferable, except (i) as required by the terms of the Revolving Trust
Agreement, (ii) upon the termination of the Revolving Trust Agreement, and
(iii) as may be required to reflect the interest of a successor trustee
under the Revolving Trust Agreement.
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(c) If the registration of transfer of an Equity Certificate is
permitted by subsection (b), then, upon surrender for registration of
transfer of such Equity Certificate at the office or agency maintained
pursuant to Section 3.8, the Owner Trustee shall execute, authenticate and
deliver (or shall cause the Authentication Agent to authenticate and
deliver), in the name of the designated transferee or transferees, one or
more new Equity Certificates in authorized denominations and aggregate
proportion of the Equity Certificate Balance dated the date of
authentication by the Owner Trustee or any Authentication Agent. If the
registration of transfer of an Equity Certificate is permitted by
subsection (b), then at the option of the Holder, such Equity Certificate
may be exchanged for other Equity Certificates in authorized denominations
of a like aggregate amount upon surrender of the Equity Certificates to be
exchanged at the office or agency maintained pursuant to Section 3.8.
(d) Every Equity Certificate presented or surrendered for
registration of transfer or exchange must be accompanied by a written
instrument of transfer in form satisfactory to the Owner Trustee and the
Certificate Registrar duly executed by the Holder or his attorney duly
authorized in writing. Each Equity Certificate properly surrendered for
registration of transfer or exchange shall be canceled and subsequently
disposed of by the Owner Trustee in accordance with its customary practice.
(e) No service charge shall be made for any registration of transfer
or exchange of Equity Certificates, but the Owner Trustee or the
Certificate Registrar may require payment of a sum sufficient to cover any
tax or governmental charge that may be imposed in connection with any
transfer or exchange of Equity Certificates.
(f) No Equity Certificate may be acquired by or for the account of
(i) an employee benefit plan (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) that is
subject to the provisions of Title 1 of ERISA, (ii) a plan described in
Section 4975(e)(1) of the Code, or (iii) any entity whose underlying assets
include plan assets by reason of a plan's investment in the entity (each, a
"Benefit Plan"). By accepting and holding an Equity Certificate, the
Holder thereof shall be deemed to have represented and warranted that it is
not a Benefit Plan.
(g) In addition to the restrictions of subsection (b) above, and
except for the transfer of the Equity Certificate to the Revolving Trust
Trustee or its designee, no transfer of an Equity Certificate may be made
by the Depositor or any other Person unless such transfer is exempt from
the registration requirements of the Securities Act of 1933 (the "Act"), as
amended, and any applicable state securities laws or is made in accordance
with the Act and such state laws. In the event that any such transfer is
to be made, (A) the Depositor may require a written Opinion of Counsel
acceptable to and in form and
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substance satisfactory to the Depositor that such transfer may be made
pursuant to an exemption, describing the applicable exemption and the basis
therefor, from the Act and such state laws or is being made pursuant to the
Act and such state laws, which Opinion of Counsel shall not be an expense
of the Owner Trustee or the Depositor, and (B) the Owner Trustee shall
require the transferee to execute a representation letter substantially in
the form of Exhibit B attached hereto, which representation letter shall
not be an expense of the Owner Trustee or the Depositor. The Equity
Certificateholder desiring to effect such transfer shall, and does hereby
agree to, indemnify the Owner Trustee, the Depositor and the Certificate
Registrar against any liability that may result if the transfer is not so
exempt or is not made in accordance with the Act and such state laws.
Section 3.5. MUTILATED, DESTROYED, LOST OR STOLEN EQUITY
CERTIFICATES. If (a) any mutilated Equity Certificate is surrendered to the
Certificate Registrar, or the Certificate Registrar receives evidence to its
satisfaction of the destruction, loss or theft of any Equity Certificate, and
(b) there is delivered to the Certificate Registrar and the Owner Trustee such
security or indemnity as may be required by them to save each of them harmless,
then, in the absence of notice to the Certificate Registrar or the Owner Trustee
that such Equity Certificate has been acquired by a bona fide purchaser, the
Owner Trustee on behalf of the Trust shall execute, authenticate and deliver (or
the Authentication Agent shall authenticate and deliver), in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Equity Certificate, a new
Equity Certificate of like tenor and portion of the Equity Certificate Balance.
In connection with the issuance of any new Equity Certificate under this Section
3.5, the Owner Trustee may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Owner Trustee and the
Certificate Registrar) connected therewith. Any duplicate Equity Certificate
issued pursuant to this Section 3.5 shall constitute conclusive evidence of
ownership of a beneficial interest in the Trust, as if originally issued,
whether or not the lost, stolen or destroyed Equity Certificate shall be found
at any time.
Section 3.6. PERSONS DEEMED OWNERS. Prior to due presentation of an
Equity Certificate for registration of transfer, the Owner Trustee, the
Certificate Registrar and any agent of the Owner Trustee or the Certificate
Registrar may treat the person in whose name any Equity Certificate is
registered as the owner of such Equity Certificate for the purpose of receiving
distributions pursuant to Section 5.2, and for all other purposes whatsoever,
and neither the Owner Trustee, the Certificate Registrar nor any agent of the
Owner Trustee or the Certificate Registrar shall be affected by any notice to
the contrary.
Section 3.7. ACCESS TO LIST OF EQUITY CERTIFICATEHOLDERS' NAMES AND
ADDRESSES. The Owner Trustee shall furnish or cause to be furnished to the
Servicer, within 15 days after receipt by the Owner Trustee of a written request
therefor, a list, in such form as the Servicer may reasonably require, of the
names and addresses of the
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Equity Certificateholders as of the most recent Record Date for payment of
distributions to Equity Certificateholders. If one or more Equity
Certificateholders evidencing not less than 25% of the Equity Certificate
Balance (hereinafter referred to as "Applicants"), apply in writing to the Owner
Trustee, and such application states that the Applicants desire to communicate
with other Equity Certificateholders with respect to their rights under this
Agreement or under the Equity Certificates and is accompanied by a copy of the
communication that such Applicants propose to transmit, then the Owner Trustee
shall, within five Business Days after the receipt of such application, afford
such Applicants access, during normal business hours, to the current list of
Equity Certificateholders. Every Equity Certificateholder, by receiving and
holding an Equity Certificate, agrees that none of the Servicer or the Owner
Trustee, nor any agent thereof, shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the Equity
Certificateholders under this Agreement, regardless of the source from which
such information was derived.
Section 3.8. MAINTENANCE OF OFFICE OR AGENCY. The Owner Trustee
shall maintain in the Borough of Manhattan, The City of New York, an office or
offices or agency or agencies where Equity Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Owner Trustee in respect of the Equity Certificates and the Related
Documents may be served. The Owner Trustee initially designates its Corporate
Trust Office as its principal corporate trust office for such purposes. The
Owner Trustee shall give prompt written notice to the Depositor and to the
Equity Certificateholders of any change in the location of the Certificate
Register or any such office of agency.
Section 3.9. APPOINTMENT OF PAYING AGENT. The Paying Agent shall
make distributions to Equity Certificateholders from the Equity Certificate
Distribution Account pursuant to Section 5.2, and shall report the amounts of
such distributions to the Owner Trustee. Any Paying Agent shall have the
revocable power to withdraw funds from the Equity Certificate Distribution
Account for the purpose of making the distributions referred to above. The
Owner Trustee may revoke such power and remove the Paying Agent if the Owner
Trustee determines in its sole discretion that the Paying Agent shall have
failed to perform its obligations under this Agreement in any material respect.
The Paying Agent shall initially be the Owner Trustee, and any co-paying agent
(which shall be a bank or trust company) chosen by the Owner Trustee. Any
Paying Agent chosen by the Owner Trustee shall be permitted to resign as Paying
Agent upon 30 days' written notice to the Owner Trustee. The Owner Trustee
shall cause each Paying Agent appointed by the Owner Trustee to execute and
deliver to the Owner Trustee an instrument in which such Paying Agent shall
agree with the Owner Trustee that as Paying Agent, such successor Paying Agent
or additional Paying Agent will hold all sums, if any, held by it for payment to
the Equity Certificateholders in trust for the benefit of the Equity
Certificateholders entitled thereto until such sums shall be paid to such Equity
Certificateholders. The Paying Agent shall return all unclaimed funds to the
Owner Trustee, and upon removal of a Paying Agent, such Paying Agent shall also
return all funds in its possession to the Owner Trustee. The provisions of
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Sections 7.1, 7.3, 7.4 and 8.2 shall apply to the Owner Trustee also in its role
as Paying Agent for so long as the Owner Trustee shall act as Paying Agent and,
to the extent applicable, to any other Paying Agent appointed hereunder. Any
reference in this Agreement to the Paying Agent shall include any co-paying
agent unless the context requires otherwise.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.1. RESTRICTION ON POWER OF EQUITY CERTIFICATEHOLDERS. No
Equity Certificateholder shall have any right to vote or in any manner otherwise
control the operation and management of the Trust except as expressly provided
in this Agreement.
Section 4.2. PRIOR NOTICE TO EQUITY CERTIFICATEHOLDERS WITH RESPECT
TO CERTAIN MATTERS. The Owner Trustee shall not take any of the following
actions, unless at least 30 days before the taking of such action, the Owner
Trustee shall have notified the Equity Certificateholders in writing of the
proposed action and the Owner Trustee shall not have received written notice
prior to the 30th day after such notice is given that an Equity Certificate
Majority have withheld consent or provided alternative direction:
(a) the amendment of this Agreement pursuant to Section 11.1, unless
such amendment would not, as evidenced by an Opinion of Counsel, materially
and adversely affect the interests of the Equity Certificateholders;
(b) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required, as provided
in Section 9.02 of the Indenture, unless such amendment would not, as
evidenced by an Opinion of Counsel, materially and adversely affect the
interests of the Equity Certificateholders;
(c) the amendment of any other Related Document pursuant to the
provisions thereof, unless such amendment would not, as evidenced by an
Opinion of Counsel, materially and adversely affect the interests of the
Equity Certificateholders; or
(d) the initiation or settlement of any material claim, proceeding or
lawsuit affecting the Trust or the Trust Assets.
Section 4.3. ACTION BY EQUITY CERTIFICATEHOLDERS WITH RESPECT TO
BANKRUPTCY. The Owner Trustee shall not have the power to commence a voluntary
proceeding in bankruptcy relating to the Depositor or the Trust without the
unanimous prior approval of the Indenture Trustee and all Equity
Certificateholders and the
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delivery to the Owner Trustee by the Indenture Trustee and each Equity
Certificateholder of a certificate certifying that the Indenture Trustee, or
such Equity Certificateholder, as the case may be, reasonably believes that the
Depositor or the Trust, as appropriate, is insolvent.
Section 4.4. RESTRICTIONS ON EQUITY CERTIFICATEHOLDERS' POWER. No
Equity Certificateholder shall have any right by virtue or by availing itself of
any provisions of this Agreement to institute any suit, action, or proceeding in
equity or at law upon or under or with respect to this Agreement or any Related
Document, unless (i) the Equity Certificateholders have provided instruction to
the Owner Trustee pursuant to Section 6.3, (ii) Equity Certificateholders
evidencing not less than 25% of the Equity Certificate Balance previously shall
have given to the Owner Trustee a written notice of default under or breach of
this Agreement or any Related Document and of the continuance thereof, as
provided in this Agreement, and (iii) Equity Certificateholders evidencing not
less than 25% of the Equity Certificate Balance shall have made written request
upon the Owner Trustee to institute such action, suit or proceeding in its own
name as Owner Trustee under this Agreement and shall have offered to the Owner
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Owner Trustee, for 30
days after its receipt of such notice, request, and offer of indemnity, shall
have neglected or refused to institute any such action, suit, or proceeding, and
during such 30-day period no request or waiver inconsistent with such written
request has been given to the Owner Trustee pursuant to and in compliance with
this Section or Section 6.3; it being understood and intended, and being
expressly covenanted by each Equity Certificateholder with every other Equity
Certificateholder and the Owner Trustee, that no one or more Holders of Equity
Certificates shall have any right in any manner whatever by virtue or by
availing itself or themselves of any provisions of this Agreement to affect,
disturb, or prejudice the rights of the Holders of any other of the Equity
Certificates, or to obtain or seek to obtain priority over or preference to any
other such Holder, or to enforce any right under this Agreement, except in the
manner provided in this Agreement and for the equal, ratable, and common benefit
of the Equity Certificateholders. For the protection and enforcement of the
provisions of this Section 4.4, each and every Equity Certificateholder and the
Owner Trustee shall be entitled to such relief as can be given either at law or
in equity.
Section 4.5. AUTHORITY OF THE DEPOSITOR. The Depositor shall have
the authority to sign, on behalf of the Owner Trust, all filings with the
Securities and Exchange Commission made by the Owner Trust.
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ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.1. TRUST ACCOUNTS.
(a) The Owner Trustee shall establish and maintain the Equity
Certificate Distribution Account in the name of the Trust for the benefit of the
Equity Certificateholders. The Equity Certificate Distribution Account shall be
an Eligible Account and initially shall be a segregated trust account
established with the Owner Trustee and maintained with the Owner Trustee.
(b) The Owner Trustee shall possess all right, title and interest in
all funds on deposit from time to time in the Equity Certificate Distribution
Account and in all proceeds thereof. If, at any time, the Equity Certificate
Distribution Account ceases to be an Eligible Account, the Owner Trustee shall
within 5 Business Days (or such longer period, not to exceed 30 calendar days,
as to which each Rating Agency may consent) establish a new Equity Certificate
Distribution Account, as an Eligible Account and shall transfer any cash and
investments to such new Equity Certificate Distribution Account.
(c) All amounts held in the Equity Certificate Distribution Account
shall, to the extent permitted by applicable laws, rules and regulations, be
invested by the Owner Trustee at the direction of the Depositor in Eligible
Investments that mature not later than one Business Day prior to the immediately
following Payment Date. Such investments shall not be sold or disposed of prior
to their maturity. All investments of funds in the Equity Certificate
Distribution Account shall be held by a financial institution in accordance with
the following requirements:
(i) all Eligible Investments shall be held in an account
with such financial institution in the name of the Owner Trustee;
(ii) with respect to securities held in such account, such
securities must be:
(A) certificated securities (as such term is used in N.Y.
UCC Section 8-313(d)(i)), securities deemed to be certificated
securities under applicable regulations of the United States
government, or uncertificated securities issued by an issuer organized
under the laws of the State of New York or the State of Delaware;
(B) either (I) in the possession of such financial
institution, (II) in the possession of a clearing corporation (as such
term is used in N.Y. UCC Section 8-102(5)), registered in the name of
such clearing corporation or its nominee, not endorsed for collection
or surrender or any other purpose not involving transfer, not
containing any evidence of a right or interest inconsistent with the
Owner Trustee's security interest
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therein, and held by such clearing corporation in an account of such
financial institution, (III) held in an account of a financial
institution with the Federal Reserve Bank of New York, or (IV) in the
case of uncertificated securities, issued in the name of such
financial institution; and
(C) identified, by book entry or otherwise, as held for the
account of, or pledged to, the Owner Trustee on the records of such
financial institution, and such financial institution shall have sent
the Owner Trustee a confirmation thereof;
(iii) with respect to repurchase obligations held in a
Certificate Account, each such repurchase obligation must be identified by
such financial institution, by book entry or otherwise, as held for the
account of, or pledged to, the Owner Trustee on the records of such
financial institution, and the related securities must be held in
accordance with the requirements of clause (ii) above;
(iv) with respect to any Eligible Investments other than
securities and repurchase agreements, such Eligible Investments must be
held in a manner acceptable to the Owner Trustee.
Subject to the other provisions hereof, the Owner Trustee shall have
sole control over each such investment and the income thereon, and any
certificate or other instrument evidencing any such investment, if any, shall be
delivered directly to the Owner Trustee or its agent, together with each
document of transfer, if any, necessary to transfer title to such investment to
the Owner Trustee in a manner which complies with this Section 5.1. All
interest, dividends, gains upon sale and other income from, or earnings on
investment of, funds in the Equity Certificate Distribution Account shall be
deposited in the Equity Certificate Distribution Account and distributed on the
next Payment Date pursuant to Section 5.2(d). The Depositor shall deposit in
the Equity Certificate Distribution Account an amount equal to any net loss on
such investments immediately as realized.
Section 5.2. APPLICATION OF FUNDS IN THE EQUITY CERTIFICATE
DISTRIBUTION ACCOUNT.
(a) On each Payment Date the Paying Agent will, based on the
information contained in the Servicer's Certificate delivered on the related
Determination Date pursuant to Section 3.9 of the Transfer and Servicing
Agreement, distribute to Equity Certificateholders, to the extent of the funds
available, amounts deposited in the Equity Certificate Distribution Account
pursuant to Sections 8.03 and 8.06 of the Indenture with respect to such Payment
Date in the following order of priority:
(i) first, from the amounts deposited in the Equity
Certificate Distribution Account pursuant to Sections 8.03 and 8.06 of the
Indenture, to the
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Equity Certificateholders, on a pro rata basis, an amount equal to the
Equity Certificate Interest Distributable Amount;
(ii) second, from the amounts deposited in the Equity
Certificate Distribution Account pursuant to Sections 8.03 and 8.06 of the
Indenture, to the Equity Certificateholders, on a pro rata basis, an amount
equal to the Equity Certificate Principal Distributable Amount;
(iii) third, to the Equity Certificateholders on a pro rata
basis, all amounts, if any, deposited in the Equity Certificate
Distribution Account pursuant to Section 8.03(vii) of the Indenture.
(b) On the Payment Date following the date on which amounts received
in respect of the Depositor's exercise of its option to purchase the corpus of
the Trust pursuant to Section 5.1(a) of the Transfer and Servicing Agreement are
deposited in the Equity Certificate Distribution Account pursuant to Section
8.03 of the Indenture, the Paying Agent will distribute such funds (taking into
account any concurrent distribution made pursuant to Section 5.2(a)) in the
following order of priority:
(i) first, to Equity Certificateholders, on a pro rata
basis, an amount equal to the Equity Certificate Interest Distributable
Amount; and
(ii) second, to Equity Certificateholders, on a pro rata
basis, the remaining Equity Certificate Balance.
(c) On the Payment Date following each date on which the Indenture
Trustee makes payments of money or property in respect of liquidation of the
Trust Assets pursuant to Section 5.06 of the Indenture and deposits funds
received in connection with such liquidation in the Equity Certificate
Distribution Account, the Paying Agent will distribute such funds (taking into
account any concurrent distribution made pursuant to Section 5.2(a)) in the
following order of priority:
(i) first, to Equity Certificateholders, on a pro rata
basis, an amount equal to the Equity Certificate Interest Distributable
Amount; and
(ii) second, to Equity Certificateholders, on a pro rata
basis, for amounts in respect of principal on the Equity Certificates to
the extent necessary to reduce the Equity Certificate Balance to zero.
(d) Any funds remaining in the Equity Certificate Distribution
Account after distribution of all other amounts specified in this Section 5.2
shall be distributed to the Equity Certificateholders, pro rata.
(e) On each Payment Date, the Paying Agent shall send to each Equity
Certificateholder the statement required pursuant to Section 7.05(b) of the
Indenture.
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(f) In the event that any withholding tax is imposed on the Trust's
payment to an Equity Certificateholder, such tax shall reduce the amount
otherwise distributable to such Equity Certificateholder in accordance with this
Section. The Paying Agent is hereby authorized and directed to retain from
amounts otherwise distributable to the Equity Certificateholders sufficient
funds for the payment of any tax that is legally owed by the Trust (but such
authorization shall not prevent the Owner Trustee from contesting any such tax
in appropriate proceedings, and withholding payment of such tax, if permitted by
law, pending the outcome of such proceedings). The amount of any withholding
tax imposed with respect to an Equity Certificateholder shall be treated as cash
distributed to such Equity Certificateholder at the time it is withheld by the
Trust and remitted to the appropriate taxing authority. If there is a
possibility that withholding tax is payable with respect to a distribution (such
as a distribution to a non-U.S. Certificateholder), the Owner Trustee may in its
sole discretion withhold such amounts in accordance with this paragraph (f). In
the event that an Equity Certificateholder wishes to apply for a refund of any
such withholding tax, the Owner Trustee shall reasonably cooperate with such
Equity Certificateholder in making such claim so long as such Equity
Certificateholder agrees to reimburse the Owner Trustee for any out-of-pocket
expenses incurred.
(g) Each reference to "pro rata" distributions in this Section 5.2
means in accordance with the proportion the original denomination of such Equity
Certificate bears to the initial Equity Certificate Balance.
Section 5.3. METHOD OF PAYMENT. Subject to Section 9.1(d),
distributions of funds required to be made to Equity Certificateholders on any
Payment Date shall be made to each Equity Certificateholder of record on the
preceding Record Date either (i) by wire transfer, in immediately available
funds, to the account of such Holder at a bank or other entity having
appropriate facilities therefor, provided that such Certificateholder shall have
provided to the Certificate Registrar appropriate written instructions at least
five Business Days prior to such Payment Date and such Holder's Certificates in
the aggregate evidence an initial denomination of not less than $10,000,000 (or
if such Certificateholder is the Revolving Trust Trustee or its nominee, the
Depository Trust Company or its nominee, or the Depositor or an Affiliate
thereof), or (ii) if not, by check mailed to such Certificateholder at the
address of such Holder appearing in the Certificate Register.
Section 5.4. NO SEGREGATION OF MONIES; NO INTEREST. Subject to
Section 5.1, monies received by the Owner Trustee hereunder need not be
segregated in any manner except to the extent required by law or by the
Indenture and may be deposited under such general conditions as may be
prescribed by law, and the Owner Trustee shall not be liable for any interest
thereon.
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ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.1. GENERAL AUTHORITY. The Owner Trustee is authorized and
directed to execute and deliver the Related Documents to which the Trust is to
be a party and each certificate or other document attached as an exhibit to or
contemplated by the Trust's Related Documents and any amendment thereto, and on
behalf of the Trust, to direct the Indenture Trustee to authenticate and deliver
to or upon the order of the Depositor the Class A-1 Notes in the aggregate
principal amount of $1,125,000,000, the Class A-2 Notes in the aggregate
principal amount of $695,000,000, the Class A-3 Notes in the aggregate principal
amount of $659,000,000, the Class A-4 Notes in the aggregate principal amount of
$400,220,000, and the Class B Notes in the aggregate principal amount of
$178,500,000. In addition to the foregoing, the Owner Trustee is authorized,
but shall not be obligated, to take all actions required of the Trust pursuant
to the Related Documents.
Section 6.2. GENERAL DUTIES. It shall be the duty of the Owner
Trustee to discharge (or cause to be discharged through such agents as shall be
appointed) all of its responsibilities pursuant to the terms of this Agreement
and the Related Documents and to administer the Trust in the interest of the
Equity Certificateholders, subject to the Related Documents and in accordance
with the provisions of this Agreement.
Section 6.3. ACTION UPON INSTRUCTION.
(a) Subject to Article IV, an Equity Certificate Majority shall have
the exclusive right to direct the actions of the Owner Trustee in the management
of the Trust, so long as such instructions are not inconsistent with the express
terms set forth herein or in any Related Document, and provided that if the
Indenture Trustee, the Noteholders or the Servicer are entitled, pursuant to the
Indenture or the Transfer and Servicing Agreement, to direct any actions of the
Owner Trustee, such directions shall control. The Equity Certificateholders may
not instruct the Owner Trustee in a manner inconsistent with this Agreement or
the Related Documents.
(b) The Owner Trustee shall not be required to take any action
hereunder or under any Related Document if the Owner Trustee shall have
reasonably determined, or shall have been advised by counsel, that such action
is contrary to the terms hereof or of any Related Document or is otherwise
contrary to law.
(c) Whenever the Owner Trustee is unable to decide between
alternative courses of action permitted or required by the terms of this
Agreement or any Related Document, and the Owner Trustee has not received
instructions with respect to such matter from the Indenture Trustee, the
Noteholders or the Servicer pursuant to the terms of the Indenture or the
Transfer and Servicing Agreement, the Owner Trustee shall promptly give notice
(in such form as shall be appropriate under the circumstances) to the Equity
Certificateholders requesting instruction as to the course of action to be
adopted, and to the extent the Owner Trustee acts in good faith in
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accordance with any written instruction received from the Equity
Certificateholders, the Owner Trustee shall not be liable on account of such
action to any Person. If the Owner Trustee shall not have received appropriate
instruction within 15 days of such notice (or within such shorter period of time
as reasonably may be specified in such notice or may be necessary under the
circumstances) it may, but shall be under no duty to, take or refrain from
taking such action, not inconsistent with this Agreement or the Related
Documents, as it shall deem to be in the best interests of the Equity
Certificateholders, and shall have no liability to any Person for such action or
inaction.
(d) In the event that the Owner Trustee is unsure as to the
application of any provision of this Agreement or any Related Document or any
such provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to take
with respect to a particular set of facts, the Owner Trustee may give notice (in
such form as shall be appropriate under the circumstances) to the Equity
Certificateholders requesting instruction and, to the extent that the Owner
Trustee acts or refrains from acting in good faith in accordance with any such
instruction received, the Owner Trustee shall not be liable, on account of such
action or inaction, to any Person. If the Owner Trustee shall not have received
appropriate instruction within 15 days of such notice (or within such shorter
period of time as reasonably may be specified in such notice or may be necessary
under the circumstances) it may, but shall be under no duty to, take or refrain
from taking such action, not inconsistent with this Agreement or the Related
Documents, as it shall deem to be in the best interests of the Equity
Certificateholders, and shall have no liability to any Person for such action or
inaction.
Section 6.4. NO DUTIES EXCEPT AS SPECIFIED IN THIS AGREEMENT, IN
RELATED DOCUMENTS OR IN INSTRUCTIONS. The Owner Trustee shall not have any duty
or obligation to manage, make any payment with respect to, register, record,
sell, dispose of, or otherwise deal with the Trust Assets, or to otherwise take
or refrain from taking any action under, or in connection with, any document
contemplated hereby to which the Trust is a party, except as expressly provided
by the terms of this Agreement (including as provided in Section 6.2), in any
Related Document or in any written instruction received by the Owner Trustee
pursuant to Section 6.3; and no implied duties or obligations shall be read into
this Agreement or any Related Document against the Owner Trustee. The Owner
Trustee shall have no responsibility for preparing, monitoring or filing any
financing or continuation statements in any public office at any time or
otherwise to perfect or maintain the perfection of any security interest or lien
granted to it hereunder or to record this Agreement or any Related Document;
however, the Owner Trustee will from time to time execute and deliver such
financing or continuation statements as are prepared by the Servicer and
delivered to the Owner Trustee for its execution on behalf of the Trust for the
purpose of perfecting or maintaining the perfection of such a security interest
or lien or effecting such a recording. The Owner Trustee nevertheless agrees
that it will, at its own cost and
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expense (and not at the expense of the Trust), promptly take all action as may
be necessary to discharge any liens on any part of the Trust Assets that are
attributable to claims against the Owner Trustee in its individual capacity that
are not related to the ownership or the administration of the Trust Assets.
Section 6.5. NO ACTION EXCEPT UNDER SPECIFIED DOCUMENTS OR
INSTRUCTIONS. The Owner Trustee shall not manage, control, use, sell, dispose
of or otherwise deal with any part of the Trust Assets except (i) in accordance
with the powers granted to and the authority conferred upon the Owner Trustee
pursuant to this Agreement, (ii) in accordance with the Related Documents and
(iii) in accordance with any document or instruction delivered to the Owner
Trustee pursuant to Section 6.3.
Section 6.6. RESTRICTIONS. The Owner Trustee shall not take any
action (a) that is inconsistent with the purposes of the Trust set forth in
Section 2.3 or (b) that, to the actual knowledge of the Owner Trustee, would
result in the Trust becoming taxable as a corporation for Federal income tax
purposes. The Equity Certificateholders may not direct the Owner Trustee to
take action that would violate the provisions of this Section.
Section 6.7. COVENANT OF THE OWNER TRUSTEE. The Owner Trustee agrees
that it will not, for any reason, institute proceedings for the Trust or the
Depositor to be adjudicated a bankrupt or insolvent, or consent to the
institution of bankruptcy or insolvency proceedings against the Trust or the
Depositor, or file a petition seeking or consenting to reorganization or relief
under any applicable Federal or state law relating to bankruptcy, or consent to
the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or
other similar official) of the Trust or the Depositor or a substantial part of
its property, or cause or permit the Trust or the Depositor to make any
assignment for the benefit of its creditors, or admit in writing its inability
to pay its debts generally as they become due, or declare or effect a moratorium
on its debt or take any action in furtherance of any such action.
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.1. ACCEPTANCE OF TRUST AND DUTIES. The Owner Trustee
accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts but only upon the terms of this Agreement. The
Owner Trustee also agrees to disburse all monies actually received by it
constituting part of the Trust Assets upon the terms of the Related Documents
and this Agreement. The Owner Trustee shall not be answerable or accountable
hereunder or under any Related Document under any circumstances, except (i) for
its own willful misconduct or gross negligence, (ii) in the case of the
inaccuracy of any representation or warranty contained in Section 7.3, (iii) for
liabilities arising from the failure of the Owner Trustee to perform obligations
expressly undertaken by it in the last sentence of Section 6.4, or (iv) for
taxes, fees or
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other charges on, based on or measured by, any fees, commissions or compensation
received by the Owner Trustee in connection with any of the transactions
contemplated by this Agreement or any Related Document. In particular, but not
by way of limitation (and subject to the exceptions set forth in the preceding
sentence):
(a) the Owner Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Owner Trustee;
(b) the Owner Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
instructions of the Certificateholders meeting the requirements of Section
6.3;
(c) no provision of this Agreement or any Related Document shall
require the Owner Trustee to expend or risk funds or otherwise incur any
financial liability in the performance of any of its rights or powers
hereunder or under any Related Document if the Owner Trustee shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured or
provided to it;
(d) under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under this Agreement or any of the
Related Documents, including the principal of and interest on the Equity
Certificates or the Notes;
(e) the Owner Trustee shall not be responsible for or in respect of
the validity or sufficiency of this Agreement (except as provided in
Section 7.3) or for the due execution hereof by the Depositor or for the
form, character, genuineness, sufficiency, value or validity of any of the
Trust Assets or for or in respect of the validity or sufficiency of the
Related Documents, other than the certificate of authentication on the
Equity Certificates, and the Owner Trustee shall in no event assume or
incur any liability, duty, or obligation to the Indenture Trustee, any
Noteholder or to any Equity Certificateholder, other than as expressly
provided for herein and in the Related Documents;
(f) the Owner Trustee shall not be liable for the default or
misconduct of the Indenture Trustee or the Servicer under any of the
Related Documents or otherwise and the Owner Trustee shall have no
obligation or liability to perform the obligations of the Trust under this
Agreement or the Related Documents that are required to be performed by the
Indenture Trustee under the Indenture or by the Servicer under the Transfer
and Servicing Agreement; and
(g) the Owner Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement, or to institute,
conduct or defend any litigation under this Agreement or otherwise or in
relation to this Agreement or any Related Document, at the request, order
or direction of the
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Equity Certificateholders, unless such Equity Certificateholders have
offered to the Owner Trustee security or indemnity satisfactory to it
against the costs, expenses and liabilities that may be incurred by the
Owner Trustee therein or thereby. The right of the Owner Trustee to
perform any discretionary act enumerated in this Agreement or in any
Related Document shall not be construed as a duty, and the Owner Trustee
shall not be answerable for other than its gross negligence or willful
misconduct in the performance of any such act.
Section 7.2. FURNISHING OF DOCUMENTS. The Owner Trustee shall
furnish to the Equity Certificateholders promptly upon receipt of a written
request therefor, duplicates or copies of all reports, notices, requests,
demands, certificates, financial statements and any other instruments furnished
to the Owner Trustee under the Related Documents unless the Equity
Certificateholders have previously received such items.
Section 7.3. REPRESENTATIONS AND WARRANTIES. The Owner Trustee
hereby represents and warrants to the Depositor and the Equity
Certificateholders that:
(a) It is a banking corporation duly organized and validly existing
in good standing under the laws of the State of New York. It has all
requisite corporate power and authority and all franchises, grants,
authorizations, consents, orders and approvals from all governmental
authorities necessary to execute, deliver and perform its obligations under
this Agreement and each Related Document to which the Trust is a party.
(b) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement and each Related Document to
which the Trust is a party, and this Agreement and each such Related
Document will be executed and delivered by one of its officers who is duly
authorized to execute and deliver this Agreement and such Related Document
on its behalf.
(c) Neither the execution nor the delivery by it of this Agreement
and each Related Document to which the Trust is a party, nor the
consummation by it of the transactions contemplated hereby or thereby nor
compliance by it with any of the terms or provisions hereof or thereof will
contravene any Federal or New York law, governmental rule or regulation
governing the banking or trust powers of the Owner Trustee or any judgment
or order binding on it, or constitute any default under its charter
documents or by-laws or any indenture, mortgage, contract, agreement or
instrument to which it is a party or by which any of its properties may be
bound or result in the creation or imposition of any lien, charge or
encumbrance on the Trust Assets resulting from actions by or claims against
the Owner Trustee individually which are unrelated to this Agreement or the
Related Documents.
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Section 7.4. RELIANCE; ADVICE OF COUNSEL.
(a) The Owner Trustee shall incur no liability to anyone in acting
upon any signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond, or other document or paper believed by it to
be genuine and believed by it to be signed by the proper party or parties. The
Owner Trustee may accept a certified copy of a resolution of the board of
directors or other governing body of any corporate party as conclusive evidence
that such resolution has been duly adopted by such body and that the same is in
full force and effect. As to any fact or matter the method of the determination
of which is not specifically prescribed herein, the Owner Trustee may for all
purposes hereof rely on a certificate, signed by the president or any vice
president or by the treasurer or other authorized officers of the relevant
party, as to such fact or matter, and such certificate shall constitute full
protection to the Owner Trustee for any action taken or omitted to be taken by
it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in
the performance of its duties and obligations under this Agreement or the
Related Documents, the Owner Trustee (i) may act directly or through its agents
or attorneys pursuant to agreements entered into with any of them, and the Owner
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with reasonable care, and (ii) may consult with counsel, accountants and
other skilled persons to be selected with reasonable care and employed by it.
The Owner Trustee shall not be liable for anything done, suffered or omitted in
good faith by it in accordance with the written opinion or advice of any such
counsel, accountants or other such persons and not contrary to this Agreement or
any Related Document.
Section 7.5. NOT ACTING IN INDIVIDUAL CAPACITY. Except as provided
in this Article VII, in accepting the trusts hereby created The Bank of New York
acts solely as Owner Trustee hereunder and not in its individual capacity and
all Persons having any claim against the Owner Trustee by reason of the
transactions contemplated by this Agreement or any Related Document shall look
only to the Trust Assets for payment or satisfaction thereof.
Section 7.6. OWNER TRUSTEE NOT LIABLE FOR EQUITY CERTIFICATES, NOTES
OR CONTRACTS. The recitals contained herein, in the Equity Certificates (other
than the signature and counter-signature of the Owner Trustee on the Equity
Certificates) and in the Notes (other than the signature or counter-signature of
the Owner Trustee on the Notes) shall be taken as the statements of the
Depositor, and the Owner Trustee assumes no responsibility for the correctness
thereof. The Owner Trustee makes no representations as to the validity or
sufficiency of this Agreement, of any Related Document or of the Equity
Certificates (other than the signature and counter-signature of the Owner
Trustee on the Equity Certificates) or the Notes (other than the signature or
counter-signature of the Owner Trustee on the Notes), or of any Contract or
related documents. The Owner Trustee shall at no time have any responsibility
or liability for
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or with respect to the legality, validity and enforceability of any Contract, or
the perfection and priority of any security interest created by any Contract in
any Equipment or the maintenance of any such perfection and priority of any
security interest created by any Contract in any Equipment, or for or with
respect to the sufficiency of the Trust Assets or its ability to generate the
payments to be distributed to Equity Certificateholders under this Agreement or
the Noteholders under the Indenture, including, without limitation: the
existence, condition and ownership of any Equipment; the existence and
enforceability of any insurance thereon; the existence and contents of any
Contract or any computer or other record thereof; the validity of the assignment
of any Contract to the Trust or of any intervening assignment; the completeness
of any Contract; the performance or enforcement of any Contract; the compliance
by the Depositor or the Servicer with any warranty or representation made under
any Related Document or in any related document or the accuracy of any such
warranty or representation or any action of the Indenture Trustee or the
Servicer taken in the name of the Owner Trustee.
Section 7.7. OWNER TRUSTEE MAY OWN EQUITY CERTIFICATES AND NOTES.
The Owner Trustee in its individual or any other capacity may become the owner
or pledgee of Equity Certificates or Notes and may deal with the Depositor, the
Indenture Trustee and the Servicer in banking or other transactions with the
same rights as it would have if it were not Owner Trustee.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.1. OWNER TRUSTEE'S FEES AND EXPENSES. The Servicer,
pursuant to the Transfer and Servicing Agreement, has covenanted and agreed to
pay to the Owner Trustee, and the Owner Trustee shall be entitled to, certain
annual fees and to reimbursement for all ordinary and reasonable out-of-pocket
expenses incurred or made by it in the performance of its duties under this
Agreement, including the reasonable compensation, expenses and disbursements of
such agents, representatives, experts and counsel as the Owner Trustee may
employ in connection with the exercise and performance of its rights and its
duties hereunder; PROVIDED, HOWEVER, that the Owner Trustee shall only be
entitled to reimbursement for expenses hereunder to the extent such expenses (i)
are fees of outside counsel engaged by the Owner Trustee in respect of the
performance of its obligations hereunder or (ii) relate to the performance of
its obligations pursuant to Section 5.3.
Section 8.2. INDEMNIFICATION. The Depositor shall be liable as
primary obligor for, and shall indemnify the Owner Trustee in its individual
capacity and its successors, assigns, agents and servants, and any co-trustee
(collectively, the "Indemnified Parties") from and against, any and all
liabilities, obligations, losses, damages, taxes, claims, actions and suits, and
any and all reasonable costs, expenses and disbursements (including reasonable
legal fees and expenses) of any kind and
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nature whatsoever (collectively, "Expenses") which may at any time be imposed
on, incurred by, or asserted against the Owner Trustee or any Indemnified Party
in any way relating to or arising out of this Agreement, the Related Documents,
the Trust Assets, the administration of the Trust Assets or the action or
inaction of the Owner Trustee hereunder, except only that the Depositor shall
not be liable for or required to indemnify the Owner Trustee from and against
Expenses arising or resulting from any of the matters described in the third
sentence of Section 7.1. The indemnities contained in this Section shall
survive the resignation or termination of the Owner Trustee or the termination
of this Agreement.
Section 8.3. NON-RECOURSE OBLIGATIONS. Notwithstanding anything in
this Agreement or any Related Document, the Owner Trustee agrees in its
individual capacity and in its capacity as Owner Trustee for the Trust that all
obligations of the Trust to the Owner Trustee individually or as Owner Trustee
for the Trust shall be recourse to the Trust Assets only and specifically shall
not be recourse to the assets of any Equity Certificateholder.
ARTICLE IX
TERMINATION
Section 9.1. TERMINATION OF THE TRUST.
(a) The respective obligations and responsibilities of the Depositor
and the Owner Trustee created by this Agreement and the Trust created by this
Agreement shall terminate upon the earliest of (i) the maturity or other
liquidation of the last Contract (including the purchase by the Depositor at its
option of the corpus of the Trust as described in Section 5.1 of the Transfer
and Servicing Agreement or the liquidation of the Trust Assets pursuant to
Section 5.06 of the Indenture) and the subsequent distribution of amounts in
respect of such Contracts as provided in the Related Documents, (ii) the
circumstances described in subsection (b) below, or (iii) the payment to
Noteholders of all amounts required to be paid to them pursuant to the
Indenture, the payment to Equity Certificateholders of all amounts required to
be paid to them pursuant to this Agreement and the payment to the Cash
Collateral Account Lenders and the Depositor of all amounts due under the Cash
Collateral Account Agreement; PROVIDED, HOWEVER, that in no event shall the
trust created by this Agreement continue beyond the expiration of 21 years from
the death of the last survivor of the descendants living on the date of this
Agreement of Rose Kennedy of the Commonwealth of Massachusetts; and PROVIDED,
FURTHER, that the rights to compensation and indemnification under Sections 8.1
and 8.2, respectively, shall survive the termination of the Trust. In any case,
there shall be delivered to the Owner Trustee, the Indenture Trustee and the
Rating Agencies an Opinion of Counsel that all applicable preference periods
under Federal, state and local bankruptcy, insolvency and similar laws have
expired with respect to the payments pursuant to clause (iii). The Servicer
shall promptly notify the Owner Trustee of any prospective termination
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pursuant to this Section 9.1. The bankruptcy, liquidation, dissolution,
termination, resignation, expulsion, withdrawal, death or incapacity of any
Equity Certificateholder shall not (x) operate to terminate this Agreement or
the Trust, nor (y) entitle such Equity Certificateholder's legal representatives
or heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of all or any part of the Trust or Trust Assets
nor (z) otherwise affect the rights, obligations and liabilities of the parties
hereto.
(b) In the event of
(i) the commencement of an involuntary case in respect of
the Depositor under the Federal bankruptcy laws, as now or hereinafter in
effect, or another present or future Federal or state bankruptcy,
insolvency or similar law and such case is not dismissed within 60 days;
(ii) the entry of a decree or order for relief by a court or
regulatory authority having jurisdiction in respect of the Depositor in an
involuntary case under the Federal bankruptcy laws, as now or hereafter in
effect, or another present or future Federal or state bankruptcy,
insolvency or similar law, or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Depositor
or of any substantial part of its property, or ordering the winding up or
liquidation of the affairs of the Depositor; or
(iii) the commencement by the Depositor of a voluntary case
under the Federal bankruptcy laws, as now or hereafter in effect, or any
other present or future Federal or state bankruptcy, insolvency or similar
law, or the consent by the Depositor to the appointment of or taking
possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Depositor or of any
substantial part of its property, or the making by the Depositor of an
assignment for the benefit of creditors, or the failure by the Depositor
generally to pay its debts as such debts become due, or the taking of
corporate action by the Depositor in furtherance of any of the foregoing;
then, after the Indenture Trustee, as required by Section 5.04 of the Indenture,
has foreclosed upon its security interest in the Trust Estate granted pursuant
to the Indenture, the respective obligations and responsibilities of the
Depositor, the Equity Certificateholders and the Owner Trustee created by this
Agreement and the Trust created by this Agreement shall terminate. All Persons
who were Equity Certificateholders on the date of such termination shall
thereupon be entitled to receive distributions directly from the Indenture
Trustee in the manner and order of priority specified in Section 5.06 of the
Indenture.
(c) Except as provided in Section 9.1(a), neither the Depositor nor
any Equity Certificateholder shall be entitled to revoke or terminate the Trust.
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(d) Within five Business Days of receipt of notice of termination of
the Trust given by the Servicer pursuant to Section 9.1(a) hereof or Section
5.1(b) of the Transfer and Servicing Agreement, the Owner Trustee shall mail
written notice to the Equity Certificateholders specifying (i) the Payment Date
upon which final payment of the Equity Certificates shall be made upon
presentation and surrender of Equity Certificates at the office of the Paying
Agent therein specified, (ii) the amount of any such final payment, and (iii)
that the Record Date otherwise applicable to such Payment Date is not
applicable, payments being made only upon presentation and surrender of the
Equity Certificates at the office of the Paying Agent therein specified. The
Owner Trustee shall give such notice to the Certificate Registrar at the time
such notice is given to Equity Certificateholders. In the event such notice is
given, (i) the Indenture Trustee shall make deposits into the Equity Certificate
Distribution Account in accordance with Section 8.03 of the Indenture, or (ii)
in the case of an optional purchase of Contracts pursuant to Section 5.1 of the
Transfer and Servicing Agreement, the Indenture Trustee shall deposit the amount
specified in Section 5.1 of the Transfer and Servicing Agreement in the Equity
Certificate Distribution Account. Upon presentation and surrender of the Equity
Certificates, the Paying Agent shall cause to be distributed to Equity
Certificateholders amounts distributable on such Payment Date pursuant to
Section 5.2.
(e) In the event that all of the Equity Certificateholders shall not
surrender their Equity Certificates for cancellation within six months after the
date specified in the above-mentioned written notice, the Owner Trustee shall
give a second written notice to the remaining Equity Certificateholders to
surrender their Equity Certificates for cancellation and receive the final
distribution with respect thereto. If within one year after the second notice
all the Equity Certificates shall not have been surrendered for cancellation,
the Owner Trustee may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Equity Certificateholders concerning
surrender of their Equity Certificates, and the cost thereof shall be paid out
of the funds and other assets that remain subject to this Agreement. Any funds
which are payable to Equity Certificateholders remaining in the Trust after
exhaustion of such remedies shall be distributed by the Owner Trustee to The
United Way (but only upon termination of this Agreement), and the Equity
Certificateholders, by acceptance of their Equity Certificates, hereby waive any
rights with respect to such funds.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.1. ELIGIBILITY REQUIREMENTS FOR OWNER TRUSTEE. The Owner
Trustee shall at all times be a corporation (i) authorized to exercise corporate
trust powers; (ii) having a combined capital and surplus of at least $50,000,000
and subject to supervision or examination by Federal or State authorities; and
(iii) having (or having a parent which has) a long-term debt rating of at least
investment grade by Moody's,
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S&P, Fitch (if rated by Fitch) and Duff & Phelps (if rated by Duff & Phelps).
If such corporation shall publish reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purpose 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. In
case at any time the Owner Trustee shall cease to be eligible in accordance with
the provisions of this Section, the Owner Trustee shall resign immediately in
the manner and with the effect specified in Section 10.2.
Section 10.2. RESIGNATION OR REMOVAL OF OWNER TRUSTEE. The Owner
Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Depositor and the Servicer at least 30
days before the date specified in such instrument. Upon receiving such notice
of resignation, the Depositor shall promptly appoint a successor Owner Trustee
meeting the qualifications set forth in Section 10.1 by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Owner Trustee and one copy to the successor Owner Trustee, provided that the
Depositor shall have received written confirmation from each of the Rating
Agencies that the proposed appointment will not result in a reduction,
qualification or withdrawal of the ratings then assigned to the Notes and the
Equity Certificates by such Rating Agency. If no successor Owner Trustee shall
have been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Owner Trustee may petition
any court of competent jurisdiction for the appointment of a successor Owner
Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.1 and shall fail to resign after
written request therefor by the Depositor or if at any time the Owner Trustee
shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a
receiver of the Owner Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the Owner Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor may remove the Owner Trustee. If the Depositor
shall remove the Owner Trustee under the authority of the immediately preceding
sentence, the Depositor shall promptly appoint a successor Owner Trustee meeting
the qualification requirements of Section 10.1 by written instrument, in
duplicate, one copy of which instrument shall be delivered to the outgoing Owner
Trustee so removed and one copy to the successor Owner Trustee and payment of
all fees owed to the outgoing Owner Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section shall
not become effective until all fees and expenses, including any indemnity
payments, due to the outgoing Owner Trustee have been paid and until acceptance
of appointment by the successor Owner Trustee pursuant to Section 10.3. The
Depositor shall provide notice of such resignation or removal of the Owner
Trustee to each of the Rating Agencies.
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Section 10.3. SUCCESSOR OWNER TRUSTEE. Any successor Owner Trustee
appointed pursuant to Section 10.2 shall execute, acknowledge and deliver to the
Depositor and to its predecessor Owner Trustee an instrument accepting such
appointment under this Agreement, and thereupon the resignation or removal of
the predecessor Owner Trustee shall become effective and such successor Owner
Trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties, and obligations of its predecessor under
this Agreement, with like effect as if originally named as Owner Trustee. The
predecessor Owner Trustee shall deliver to the successor Owner Trustee all
documents and statements and monies held by it under this Agreement; and the
Depositor and the predecessor Owner Trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for fully and
certainly vesting and confirming in the successor Owner Trustee all such rights,
powers, duties, and obligations.
No successor Owner Trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor Owner Trustee
shall be eligible pursuant to Section 10.1.
Upon acceptance of appointment by a successor Owner Trustee pursuant
to this Section, the Depositor shall mail notice of the successor of such Owner
Trustee to all Equity Certificateholders, the Indenture Trustee, the Noteholders
and the Rating Agencies. If the Depositor shall fail to mail such notice within
10 days after acceptance of appointment by the successor Owner Trustee, the
successor Owner Trustee shall cause such notice to be mailed at the expense of
the Depositor.
Section 10.4. MERGER OR CONSOLIDATION OF OWNER TRUSTEE. Any
corporation into which the Owner Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Owner Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Owner Trustee, shall be the successor of the Owner Trustee
hereunder, provided such corporation shall be eligible pursuant to Section 10.1,
without the execution or filing of any instrument or any further act on the part
of any of the parties hereto, anything herein to the contrary notwithstanding,
and provided further that the Owner Trustee shall mail notice of such merger or
consolidation to the Rating Agencies.
Section 10.5. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Assets may at the time be located, the Owner Trustee shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Owner Trustee to act as co-trustee, jointly with the
Owner Trustee, or separate trustee or separate trustees, of all or any part of
the Trust Assets, and to vest in such Person, in such capacity, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section, such powers, duties, obligations, rights and trusts as the
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Owner Trustee may consider necessary or desirable. No co-trustee or separate
trustee under this Agreement shall be required to meet the terms of eligibility
as a successor trustee pursuant to Section 10.1 and no notice of the appointment
of any co-trustee or separate trustee shall be required pursuant to Section
10.1.
Each 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 Owner Trustee shall be conferred upon and exercised or performed
by the Owner 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 Owner Trustee joining in such act), except to
the extent that under any law of any jurisdiction in which any particular
act or acts are to be performed the Owner Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties, and obligations (including the holding of title to the
Trust Assets 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 Owner Trustee;
(ii) no trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement;
and
(iii) the Owner Trustee may at any time accept the resignation of
or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Owner 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. 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 Owner
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Owner Trustee. Each such instrument shall be filed with the Owner
Trustee.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Owner Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.
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ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.1. AMENDMENT.
(a) This Agreement may be amended by the Depositor and the Owner
Trustee, without the consent of any of the Equity Certificateholders or
Noteholders, but with prior notice to the Rating Agencies and the Indenture
Trustee, for any of the following purposes:
(i) to correct or amplify the description of the Trust
Assets;
(ii) to cure any ambiguity;
(iii) to correct or supplement any provision herein which may
be inconsistent with any other provision herein;
(iv) to make any other provisions with respect to matters or
questions arising under this Agreement, provided that such amendment shall
not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Noteholder or Equity
Certificateholder; or
(v) to avoid a reduction, qualification or withdrawal of
any rating of the Notes or the Equity Certificates.
(b) This Agreement may also be amended from time to time by the
Depositor and the Owner Trustee with the consent of an Equity Certificate
Majority and, unless such amendment does not, as evidenced by an Opinion of
Counsel, materially and adversely affect the interests of Noteholders, the
consent of a Note Majority (which consent of any Holder of an Equity Certificate
or Note given pursuant to this Section or pursuant to any other provision of
this Agreement shall be conclusive and binding on such Holder and on all future
Holders of such Equity Certificate or Note and of any Equity Certificate or Note
issued upon the transfer thereof or in exchange therefor or in lieu thereof
whether or not notation of such consent is made upon the Equity Certificate or
Note) for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement, or of modifying in any
manner the rights of the Holders of Equity Certificates or Notes; PROVIDED,
HOWEVER, that no such amendment shall (i) increase or reduce in any manner the
amount of, or accelerate or delay the timing of, collections of payments on
Contracts or distributions that shall be required to be made on any Equity
Certificate or Note, (ii) reduce the aforesaid percentage required to consent to
any such amendment or any waiver hereunder, without the consent of the Holders
of all Equity Certificates and Notes then outstanding, or (iii) result in a
reduction, qualification or withdrawal of the rating of the Notes or the Equity
Certificates.
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(c) Prior to the execution of any such amendment or consent, the
Depositor shall furnish written notification of the substance of such amendment
or consent to each Rating Agency.
(d) Promptly after the execution of any such amendment or consent,
the Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Equity Certificateholder and the Indenture Trustee
unless such parties have previously received such notification.
(e) It shall not be necessary for the consent of Equity
Certificateholders or Noteholders pursuant to Section 11.1(b) to approve the
particular form of any proposed amendment or consent, but it shall be sufficient
if such consent shall approve the substance thereof. The manner of obtaining
such consents (and any other consents of Equity Certificateholders and
Noteholders provided for in this Agreement) and of evidencing the authorization
of the execution thereof by Equity Certificateholders shall be subject to such
reasonable requirements as the Owner Trustee may prescribe, including the
establishment of record dates.
(f) Prior to the execution of any amendment to this Agreement or any
Related Document, the Owner Trustee shall be entitled to receive and rely upon
an Opinion of Counsel stating that the execution of such amendment is authorized
or permitted by this Agreement and that all conditions precedent to the
execution and delivery of such amendment have been satisfied. The Owner Trustee
may, but shall not be obligated to, enter into any such amendment which affects
the Owner Trustee's own rights, duties or immunities under this Agreement or any
Related Document, or otherwise.
SECTION 11.2. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.
Section 11.3. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Equity
Certificates or the rights of the Holders thereof.
Section 11.4. EQUITY CERTIFICATES NONASSESSABLE AND FULLY PAID.
Equity Certificateholders shall not, except as expressly provided for herein
with respect to the Depositor, be personally liable for obligations of the
Trust, the beneficial interests in the
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Trust represented by the Equity Certificates shall be nonassessable for any
losses or expenses of the Trust or for any reason whatsoever, and Equity
Certificates upon authentication thereof by or on behalf of the Owner Trustee
pursuant to Section 3.3 are and shall be deemed fully paid.
Section 11.5. THIRD-PARTY BENEFICIARIES. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. Except as otherwise provided in this
Agreement, no other Person shall have any right or obligation hereunder.
Section 11.6. COUNTERPARTS. For the purpose of facilitating its
execution and for other purposes, this Agreement may be executed simultaneously
in any number of counterparts, each of which counterparts shall be deemed to be
an original, and all of which counterparts shall constitute but one and the same
instrument.
Section 11.7. NOTICES. All demands, notices and communications under
this Agreement shall be in writing, personally delivered or mailed by certified
mail-return receipt requested, or by facsimile, and shall be deemed to have been
duly given upon receipt (a) in the case of the Depositor, at the following
address: Antigua Funding Corporation, c/o AT&T Capital Corporation, 44 Whippany
Road, Morristown, New Jersey 07962, Attention: General Counsel, (b) in the case
of the Owner Trustee, at the Corporate Trust Office, and (c) in the case of each
Rating Agency, Moody's Investors Service, Inc., 99 Church Street, New York, New
York 10007; Standard & Poor's Ratings Services, 26 Broadway, New York, New York
10004 Attention: Asset-Backed Surveillance; Fitch Investors Services, L.P., One
State Street Plaza, New York, New York 10004; Duff & Phelps Credit Rating Co.,
17 State Street, New York, New York 10004; or at such other address as shall be
designated by any such party in a written notice to the other parties.
Notwithstanding the foregoing, any notice required or permitted to be mailed to
an Equity Certificateholder shall be given by first class mail, postage prepaid,
at the address of such Holder as shown in the Certificate Register, and any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the Equity
Certificateholder receives such notice.
-38-
<PAGE>
IN WITNESS WHEREOF, the Depositor and the Owner Trustee have caused
this Trust Agreement to be duly executed by their respective officers as of the
day and year first above written.
ANTIGUA FUNDING CORPORATION
By /s/ James Elton
--------------------------------------
Name: James Elton
-------------------------------
Title: Vice President
-------------------------------
THE BANK OF NEW YORK
By /s/ Cheryl L. Laser
--------------------------------------
Name: Cheryl L. Laser
-------------------------------
Title: Assistant Vice President
-------------------------------
-39-
<PAGE>
EXHIBIT A
[FORM OF EQUITY CERTIFICATE]
CAPITA EQUIPMENT RECEIVABLES TRUST 1996-1
6.75% EQUITY CERTIFICATE
evidencing a beneficial interest in the Trust, as defined below, the
property of which includes a pool of equipment leases, installment
sale contracts, promissory notes, loan and security agreements and
similar types of receivables, all transferred to the Trust by Antigua
Funding Corporation.
This Equity Certificate does not represent an obligation of, or an
interest in, Antigua Funding Corporation or any affiliate thereof.
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT UNDER
THE CIRCUMSTANCES SPECIFIED IN SECTION 3.4 OF THE
TRUST AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND
LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 3.4 OF THE TRUST AGREEMENT REFERRED TO
HEREIN.
Certificate No. ____
Denomination: $________
Cut-Off Date:
Aggregate Denomination of all
October 1, 1996
Equity Certificates: $127,509,329
First Payment Date: Interest Rate: 6.75%
November 15, 1996
Stated Maturity Date:
Servicer:
September 15, 2004
AT&T Capital Corporation
<PAGE>
CUSIP: 13970L AF 9
A-2
<PAGE>
THIS CERTIFIES THAT is the
registered owner of a nonassessable, fully-paid, beneficial interest in the
Capita Equipment Receivables Trust 1996-1 (the "Trust"). The Trust was created
pursuant to a Trust Agreement, dated as of October 1, 1996 (the "Trust
Agreement"), between Antigua Funding Corporation and The Bank of New York, not
in its individual capacity but solely as owner trustee (the "Owner Trustee"), a
summary of certain of the pertinent provisions of which is set forth below. To
the extent not otherwise defined herein, the capitalized terms used herein have
the meanings assigned to them in the Trust Agreement or the Indenture, dated as
of October 1, 1996 (the "Indenture"), between the Trust and The Chase Manhattan
Bank, as Indenture Trustee.
This Certificate is one of the duly authorized Certificates designated
as "6.75% Equity Certificates" (herein called the "Equity Certificates"). The
Trust has also issued, under the Indenture, Notes designated as 5.60%
Receivable-Backed Notes, Class A-1 (the "Class A-1 Notes"), 5.95%
Receivable-Backed Notes, Class A-2 (the "Class A-2 Notes") 6.11%
Receivable-Backed Notes, Class A-3 (the "Class A-3 Notes"), 6.28%
Receivable-Backed Notes, Class A-4 (the "Class A-4 Notes"), and 6.57%
Receivable-Backed Notes, Class B (the "Class B Notes" and, together with the
Class A-1, Class A-2, Class A-3 and Class A-4 Notes, the "Notes"). This Equity
Certificate is issued under the Trust Agreement and is subject to the terms,
provisions and conditions of the Trust Agreement and the Indenture, to which
Trust Agreement and Indenture the holder of this Equity Certificate by virtue of
the acceptance hereof assents and by which such holder is bound. The property
of the Trust includes (as more fully described in the Trust Agreement) a pool of
equipment leases, installment sale contracts, promissory notes, loan and
security agreements and similar types of receivables (the "Contracts"), the
right to a portion of the Liquidation Proceeds arising from disposition of the
Equipment related to the Lease Contracts following default thereunder, certain
monies received thereunder after the Cut-Off Date, certain bank accounts,
proceeds from certain insurance policies and proceeds of all of the foregoing.
Under the Trust Agreement, there will be distributed on the 15th day
of each month or, if such 15th day is not a Business Day, the next succeeding
Business Day (the "Payment Date"), commencing on November 15, 1996 to the person
in whose name this Equity Certificate is registered at the close of business on
the Business Day immediately preceding such Payment Date (the "Record Date"),
such Certificateholder's fractional undivided interest in the sum of (a) the
Equity Certificate Interest Distributable Amount, (b) the Equity Certificate
Principal Distributable Amount, (c) any remaining Amount Available after
distribution of all other amounts payable on such Payment Date, to the extent of
the funds available therefor. As provided in the Indenture, interest hereon is
subordinated in right of payment to the payment of interest on the Notes, and
principal hereon is subordinated in right of payment to the payment of principal
on the Notes.
Each Equity Certificateholder, by its acceptance of an Equity
Certificate, covenants and agrees that such Equity Certificateholder will not at
any time institute
A-3
<PAGE>
against the Depositor or join in any institution against the Depositor or the
Trust of any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Equity Certificates, the Notes, the Trust Agreement or any of the Related
Documents.
Except as provided in the Trust Agreement, distributions on this
Equity Certificate will be made by the Owner Trustee either (i) by wire
transfer, in immediately available funds, to the account of such Holder at a
bank or other entity having appropriate facilities therefor, provided that such
Equity Certificateholder shall have provided to the Certificate Registrar
appropriate written instructions at least five Business Days prior to such
Payment Date and such Holder's Equity Certificates in the aggregate evidence an
initial denomination of not less than $10,000,000 (or if such Certificateholder
is the Revolving Trust Trustee or its nominee, the Depository Trust Company or
its nominee, or the Depositor or an Affiliate thereof), or (ii) if not, by check
mailed to such Equity Certificateholder at the address of such Holder appearing
in the Certificate Register. Except as otherwise provided in the Trust
Agreement and notwithstanding the above, the final distribution on this Equity
Certificate will be made after due notice by the Owner Trustee of the pendency
of such distribution and only upon presentation and surrender of this Equity
Certificate at the office or agency maintained for that purpose by the Owner
Trustee. The Record Date otherwise applicable to distributions shall not be
applicable to such final distribution.
The Equity Certificates do not represent an obligation of, or an
interest in, the Depositor, the Servicer, the Owner Trustee or any Affiliate of
any of them. The Equity Certificates are limited in right of payment to certain
collections and recoveries respecting the Contracts, all as more specifically
set forth in the Trust Agreement and the Indenture. A copy of the Trust
Agreement and the Indenture may, upon request, be examined by any Equity
Certificateholder during normal business hours at the principal office of the
Depositor and at such other places, if any, designated by the Depositor.
The Trust Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
parties thereto and the rights of the Equity Certificateholders under the Trust
Agreement at any time by the Depositor and the Owner Trustee. In certain
limited circumstances, the Trust Agreement may only be amended with the consent
of the Holders of Equity Certificates evidencing not less than a majority of the
Equity Certificate Balance and, in certain circumstances, 100% of the Equity
Certificate Balance. Any such consent by the Holder of this Equity Certificate
shall be conclusive and binding on such Holder and on all future Holders of this
Equity Certificate and of any Equity Certificate issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such consent
is made upon this Equity Certificate.
A-4
<PAGE>
Under the limited circumstances specified in Section 3.4 of the Trust
Agreement, the transfer of this Equity Certificate is registrable in the
Certificate Register upon surrender of this Equity Certificate for registration
of transfer at the offices or agencies of the Certificate Registrar maintained
by the Owner Trustee in New York, New York accompanied by a written instrument
of transfer in form satisfactory to the Owner Trustee and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Equity Certificates of
authorized denominations evidencing the same aggregate beneficial interest in
the Trust of the same class will be issued to the designated transferee. Under
such circumstances, the Equity Certificates are issuable only as registered
Certificates without coupons in denominations of $250,000 initial principal
amount and integral multiples of $1,000 thereof, and Equity Certificates are
exchangeable for new Equity Certificates of authorized denominations of a like
aggregate initial principal amount, as requested by the Holder surrendering the
same. No service charge will be made for any such registration of transfer or
exchange, but the Owner Trustee may require payment of a sum sufficient to cover
any tax or governmental charges payable in connection therewith. The initial
Certificate Registrar appointed under the Trust Agreement is The Bank of New
York.
The Equity Certificates may not be acquired by (a) an employee benefit
plan (as defined in Section 3(3) of ERISA) that is subject to the provisions of
Title 1 of ERISA, (b) a plan described in Section 4975(e)(1) of the Code or (c)
any entity whose underlying assets include plan assets by reason of a plan's
investment in the entity (each, a "Benefit Plan"). By accepting and holding
this Equity Certificate, the Holder hereof shall be deemed to have represented
and warranted that it is not a Benefit Plan.
The Owner Trustee, the Certificate Registrar and any agent of the
Owner Trustee or the Certificate Registrar may treat the person in whose name
this Equity Certificate is registered as the owner hereof for the purpose of
receiving distributions and for all other purposes, and neither the Owner
Trustee, the Certificate Registrar nor any such agent shall be affected by any
notice to the contrary.
The obligations and responsibilities created by the Trust Agreement
and Trust created thereby shall terminate upon the payment to Equity
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the disposition of all property held as part of the Trust.
The Depositor may at its option purchase the corpus of the Trust at a price
specified in the Transfer and Servicing Agreement, and such purchase of the
Contracts and other property of the Trust will effect early retirement of the
Equity Certificates; provided, however, such right of purchase is exercisable
only as of a Record Date as of which the aggregate principal balance of the
Notes and the Equity Certificates is less than 10% of the Initial Contract Pool
Principal Balance.
The recitals contained herein shall be taken as the statements of the
Depositor or the Servicer, as the case may be, and the Owner Trustee assumes no
A-5
<PAGE>
responsibility for the correctness thereof. The Owner Trustee makes no
representations as to the validity or sufficiency of this Equity Certificate or
of any Contract or related document.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee, by manual or facsimile
signature, this Equity Certificate shall not entitle the holder hereof to any
benefit under the Trust Agreement or the Transfer and Servicing Agreement or be
valid for any purpose.
A-6
<PAGE>
IN WITNESS WHEREOF, the Owner Trustee on behalf of the Trust and not
in its individual capacity has caused this Equity Certificate to be duly
executed.
Dated: October 15, 1996 CAPITA EQUIPMENT RECEIVABLES TRUST
1996-1
By: THE BANK OF NEW YORK, not in
its individual capacity but
solely as Owner Trustee
By:
------------------------------
Name:
Title:
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 6.75% Equity Certificates of Capita Equipment
Receivables Trust 1996-1 referred to in the within-mentioned Trust Agreement.
THE BANK OF NEW YORK,
not in its individual capacity but
solely as Owner Trustee
By:
------------------------------
Name:
Title:
A-7
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
- --------------------------------------------------------------------------------
(Please print or typewrite name and address, including postal zip code, of
assignee)
- --------------------------------------------------------------------------------
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
- --------------------------------------------------------------------------------
Attorney to transfer said Certificate on the books of the Certificate Registrar,
with full power of substitution in the premises.
Dated:
*
----------------------------------
Signature Guaranteed:
*
----------------------------------
SIGNATURE GUARANTEE
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the [Registrar], which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Certificate
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended.
A-8
<PAGE>
EXHIBIT B
FORM OF REPRESENTATION LETTER
The Bank of New York
101 Barclay Street, Floor 12E
New York, New York 10286
Antigua Funding Corporation
44 Whippany Road
Morristown, New Jersey 07962
RE: Capita Equipment Receivables Trust 1996-1
Equity Certificates
The undersigned purchaser (the "Purchaser") understands that the
purchase of the above-referenced certificates (the "Certificates") may be made
only by (a) institutions which are "Accredited Investors" under Rule 501(a)(1),
(2), (3) or (7) of Regulation D, as promulgated under the Securities Act of
1933, as amended (the "1933 Act"), or an entity in which all of the equity
owners meet such requirements, which includes banks, savings and loan
associations, registered brokers and dealers, insurance companies, investment
companies, and organizations described in Section 501(c)(3) of the Internal
Revenue Code, corporations, business trusts and partnerships, not formed for the
specific purpose of acquiring the Certificates offered, with total assets in
excess of $5,000,000, or (b) "Qualified Institutional Buyers" under Rule 144A,
as promulgated under the 1933 Act. The undersigned represents on behalf of the
Purchaser that the Purchaser is an "Accredited Investor" or a "Qualified
Institutional Buyer" within the meaning of such definitions. The Purchaser is
urged to review carefully the responses, representations and warranties it is
making herein.
REPRESENTATIONS AND WARRANTIES
The Purchaser makes the following representations and warranties in
order to permit the Owner Trustee and the Depositor to determine its suitability
as a purchaser of Certificates and to determine that the exemption from
registration relied upon by the Depositor under Section 4(2) of the 1933 Act is
available to it.
1. The Purchaser understands that the Certificates have not been and
will not be registered under the 1933 Act and may be resold (which resale is not
currently contemplated) only if registered pursuant to the provisions of the
1933 Act or if an exemption from registration is available, that the Depositor
is not required to register the Certificates and that any transfer must comply
with Section 3.4 of the Trust Agreement relating to the Certificates.
2. The Purchaser will comply with all applicable Federal and state
securities laws in connection with any subsequent resale of the Certificates.
B-1
<PAGE>
3. The Purchaser is a sophisticated institutional investor and has
knowledge and experience in financial and business matters and is capable of
evaluating the merits and risks of its investment in the Certificates and is
able to bear the economic risk of such investment.
4. The Purchaser is acquiring the Certificates as principal for its
own account (or for the account of one or more other institutional investors for
which it is acting as duly authorized fiduciary or agent) for the purpose of
investment and not with a view to or for sale in connection with any
distribution thereof, subject nevertheless to any requirement of law that the
disposition of the Purchaser's property shall at all times be and remain within
its control.
5. The Purchaser does not qualify as (i) an employee benefit plan (a
"Plan") as defined in section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), whether or not it is subject to the
provisions of Title I of ERISA, (ii) a plan described in section 4975(e)(1) of
the Internal Revenue Code of 1986 (also a "Plan"), or (iii) an entity whose
underlying assets are deemed to be assets of a Plan by reason of such Plan's
investment in the entity (as determined under Department of Labor Regulations,
29 C.F.R. Section 2510.3-101 (1990)).
6. The Purchaser understands that such Certificate will bear a
legend substantially as set forth in the form of Certificate included in the
Trust Agreement.
7. The Purchaser agrees that it will obtain from any purchaser of
the Certificates from it the same representations, warranties and agreements
contained in the foregoing paragraphs 1 through 6 and in this paragraph 7.
The representations and warranties contained herein are made for your
benefit and shall be binding upon the heirs, executors, administrators and other
successors of the undersigned. If there is more than one signatory hereto, the
obligations, representations, warranties and agreements of the undersigned are
made jointly and severally.
Executed at _______________, ________________, this _________ day of
____________, ________.
Purchaser's Name (Print)
By
------------------------------------
Signature
Its
------------------------------------
- --------------------------------------------
- -----------
B-2
<PAGE>
------------------------------------
Address of Purchaser
------------------------------------
Purchaser's Taxpayer
Identification Number
B-3
<PAGE>
Exhibit 4.5
- ----------------------------------------------------------
- ----------------------------------------------------------
PURCHASE AND SALE AGREEMENT
AMONG
ANTIGUA FUNDING CORPORATION
PURCHASER
AT&T CAPITAL CORPORATION
IN ITS INDIVIDUAL CAPACITY AND AS SERVICER
AND
AT&T CAPITAL LEASING SERVICES, INC.
AT&T CREDIT CORPORATION
NCR CREDIT CORP.
AT&T COMMERCIAL FINANCE CORPORATION
SELLERS
---------------------------
DATED AS OF OCTOBER 1, 1996
---------------------------
- ----------------------------------------------------------
- ----------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.1 General . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.2 Specific Terms . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.3 Usage of Terms . . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.4 Certain References . . . . . . . . . . . . . . . . . . . 3
SECTION 1.5 No Recourse . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.6 Action by or Consent of Noteholders or Equity
Certificateholders . . . . . . . . . . . . . . . . . . . 3
ARTICLE II CONVEYANCE OF THE CONTRACTS . . . . . . . . . . . . . . . . . 4
SECTION 2.1 Conveyance of Contracts and Related Assets . . . . . . . 4
SECTION 2.2 Intention of the Parties . . . . . . . . . . . . . . . . 5
ARTICLE III REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . 6
SECTION 3.1 Representations and Warranties of TCC . . . . . . . . . 6
SECTION 3.2 Representations and Warranties of Leasing Services. . . 8
SECTION 3.3 Representations and Warranties of Credit Corp. . . . . . 10
SECTION 3.4 Representations and Warranties of NCR Credit . . . . . . 12
SECTION 3.5 Representations and Warranties of CFC . . . . . . . . . 14
SECTION 3.6 Representations and Warranties of Antigua . . . . . . . 17
ARTICLE IV COVENANTS OF THE SELLERS . . . . . . . . . . . . . . . . . . 19
SECTION 4.1 Protection of Title of Antigua and the Trust . . . . . . 19
SECTION 4.2 Other Liens or Interests . . . . . . . . . . . . . . . . 22
SECTION 4.3 Costs and Expenses . . . . . . . . . . . . . . . . . . . 22
SECTION 4.4 Indemnification . . . . . . . . . . . . . . . . . . . . 22
SECTION 4.5 Negative Covenant . . . . . . . . . . . . . . . . . . . 24
ARTICLE V REPURCHASES . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 5.1 Repurchase of Contracts Upon Breach of Representation
or Warranty . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 5.2 Reassignment of Purchased Contracts and Leased
Equipment . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 5.3 Waivers . . . . . . . . . . . . . . . . . . . . . . . . 26
ARTICLE VI MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 6.1 Liability of the Sellers and TCC . . . . . . . . . . . . 26
SECTION 6.2 Merger or Consolidation of a Seller, TCC or Antigua . . 26
SECTION 6.3 Limitation on Liability of the Sellers, TCC and Others
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 6.4 The Sellers and TCC May Own Notes or Equity
Certificates . . . . . . . . . . . . . . . . . . . . . . 28
<PAGE>
SECTION 6.5 Amendment . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 6.6 Notices . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 6.7 Merger and Integration . . . . . . . . . . . . . . . . . 30
SECTION 6.8 Severability of Provisions . . . . . . . . . . . . . . . 30
SECTION 6.9 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . 30
SECTION 6.10 Counterparts . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 6.11 Conveyance of the Contracts to the Trust . . . . . . . . 30
SECTION 6.12 Nonpetition Covenant . . . . . . . . . . . . . . . . . . 31
SCHEDULES
Schedule A-1 -- Schedule of Lease Contracts and Leased Equipment
Schedule A-2 -- Schedule of Loan Contracts
Schedule B -- Schedule of Representations and Warranties of the Sellers
and TCC
-ii-
<PAGE>
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT, dated as of October 1, 1996,
executed between Antigua Funding Corporation, a Delaware corporation, as
purchaser ("Antigua"), AT&T Capital Corporation, a Delaware corporation, in
its individual capacity ("TCC"), and as servicer (the "Servicer"), AT&T
Capital Leasing Services, Inc., a Massachusetts corporation ("Leasing
Services"), AT&T Credit Corporation, a Delaware corporation ("Credit
Corp."), NCR Credit Corp., a Delaware corporation ("NCR Credit") and AT&T
Commercial Finance Corporation, a Delaware corporation ("CFC"), as sellers
(each a "Seller" and, together, "the Sellers").
W I T N E S S E T H:
WHEREAS, pursuant to the terms of an Amended and Restated Trust
Agreement, dated as of October 1, 1996 (the "Trust Agreement"), between
Antigua and The Bank of New York, as Owner Trustee, Antigua has formed
Capita Equipment Receivables Trust 1996-1 (the "Trust"), and the Trust has
issued the Equity Certificates to Antigua; and
WHEREAS, pursuant to the terms of an Indenture, dated as of
October 1, 1996 (the "Indenture"), between the Trust and The Chase
Manhattan Bank, as Trustee (the "Indenture Trustee"), the Trust has, on the
Closing Date, issued the Notes (as defined in the Indenture); and
WHEREAS, the Sellers own certain Lease Contracts as are more
particularly described in Schedule A-1 attached hereto and have an
ownership or security interest in the items of Equipment subject thereto
(the "Leased Equipment"), as more particularly described in Schedule A-1
attached hereto, and the Sellers own certain Loan Contracts as are more
particularly described in Schedule A-2 attached hereto, which create a
security interest in the items of equipment subject thereto (the "Loan
Equipment"), (the Loan Equipment and the Leased Equipment being
collectively referred to herein as the "Equipment"); and
WHEREAS, pursuant to the terms of a Transfer and Servicing
Agreement, dated as of October 1, 1996 (the "Transfer and Servicing
Agreement"), by and among the Trust, Antigua, as depositor, and TCC, in its
individual capacity and as Servicer, to be executed concurrently with the
execution of this Agreement, Antigua will convey the Contracts to the
Trust; and
WHEREAS, pursuant to a Loan Agreement, dated as of October 1,
1996, among the Owner Trustee, the Indenture Trustee, the Depositor, TCC,
in its individual capacity and as Servicer, the Lenders party thereto, and
the agent thereunder, there will be established a Cash Collateral Account
for the benefit of the Noteholders and the Equity Certificateholders; and
<PAGE>
WHEREAS, Antigua has agreed to acquire the Contracts and the
Leased Equipment from the Sellers and the Sellers have agreed to transfer
the Contracts and the Leased Equipment to Antigua; and
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and for other good and valuable consideration, the receipt of
which is acknowledged, Antigua, TCC, the Servicer and the Sellers,
intending to be legally bound, hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 GENERAL. The words "herein," "hereof" and
"hereunder" and other words of similar import refer to this Agreement as a
whole and not to any particular Article, Section or other subdivision, and
Article, Section, Schedule and Exhibit references, unless otherwise
specified, refer to Articles and Sections of and Schedules and Exhibits to
this Agreement. All capitalized terms used herein without definition shall
have the respective meanings assigned to such terms in the Transfer and
Servicing Agreement or, if not defined in the Transfer and Servicing
Agreement, in the Indenture.
SECTION 1.2 SPECIFIC TERMS. Whenever used in this Agreement,
the following words and phrases, unless the context otherwise requires,
shall have the following meanings:
"AGREEMENT" means this Purchase and Sale Agreement and all
amendments hereof and supplements hereto.
"CLOSING DATE" means October 15, 1996.
"RELATED DOCUMENTS" means the Trust Agreement, the Indenture, the
Transfer and Servicing Agreement, the Equity Certificates, the Notes and
the Cash Collateral Account Agreement. The Related Documents to be
executed by any party are referred to herein as "such party's Related
Documents," "its Related Documents" or by a similar expression.
"REPURCHASE EVENT" means, with respect to any Contract, the
occurrence of a breach of any of the representations and warranties set
forth in the Schedule of Representations that materially and adversely
affects the value of such Contract.
"SCHEDULE OF CONTRACTS" means, collectively, the schedules of
Lease Contracts and Loan Contracts attached hereto as Schedule A-1 and
Schedule A-2, respectively.
-2-
<PAGE>
"SCHEDULE OF REPRESENTATIONS" means the Schedule of
Representations and Warranties attached hereto as Schedule B.
"TRUST" means the trust created by the Trust Agreement, the
estate of which consists of the Trust Assets.
"TRUST ASSETS" means the property and proceeds of every
description conveyed pursuant to Section 2.6 of the Trust Agreement and
Section 2.1 of the Transfer and Servicing Agreement, together with the
Trust Accounts (including all Eligible Investments therein and all proceeds
therefrom), and the right to withdraw funds from the Cash Collateral
Account pursuant to Section 8.06 of the Indenture.
SECTION 1.3 USAGE OF TERMS. With respect to all terms used in
this Agreement, the singular includes the plural and the plural the
singular; words importing any gender include the other gender; references
to "writing" include printing, typing, lithography, and other means of
reproducing words in a visible form; references to agreements and other
contractual instruments include all subsequent amendments thereto or
changes therein entered into in accordance with their respective terms and
not prohibited by this Agreement or the Transfer and Servicing Agreement;
references to Persons include their permitted successors and assigns; and
the terms "include" or "including" mean "include without limitation" or
"including without limitation."
SECTION 1.4 CERTAIN REFERENCES. All references to the Contract
Principal Balance of a Contract as of an Accounting Date shall refer to the
close of business on such day, or as of the first day of a Monthly Period
shall refer to the opening of business on such day. All references to the
last day of a Monthly Period shall refer to the close of business on such
day.
SECTION 1.5 NO RECOURSE. Without limiting the obligations of
the Sellers or TCC hereunder, no recourse may be taken, directly or
indirectly, under this Agreement or any certificate or other writing
delivered in connection herewith or therewith, against any stockholder,
officer or director, as such, of any of Antigua, the Sellers, TCC, the
Servicer, the Indenture Trustee or the Owner Trustee, or of any predecessor
or successor of any of Antigua, the Sellers, TCC, the Servicer, the
Indenture Trustee or the Owner Trustee.
SECTION 1.6 ACTION BY OR CONSENT OF NOTEHOLDERS OR EQUITY
CERTIFICATEHOLDERS. Whenever any provision of this Agreement refers to
action to be taken, or consented to, by Noteholders or Equity
Certificateholders, such provision shall be deemed to refer to Noteholders
or Equity Certificateholders, as the case may be, of record as of the
Record Date immediately preceding the date on which such action is to be
taken, or consent given, by such Noteholders or Equity Certificateholders,
as the case may be. Solely for the purposes of any action to be taken, or
consented to, by Noteholders or Equity Certificateholders, any Note or
Equity Certificate registered in
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the name of any of Antigua, a Seller or TCC, or any Affiliate thereof (but
not including the Revolving Trust), shall be deemed not to be outstanding,
and the related Principal Balance, as applicable, evidenced thereby shall
not be taken into account in determining whether the requisite Principal
Balance necessary to effect any such action or consent has been obtained;
PROVIDED, HOWEVER, that, solely for the purpose of determining whether the
Indenture Trustee or Owner Trustee is entitled to rely upon any such action
or consent, only Notes or Equity Certificates which the Indenture Trustee
or Owner Trustee knows to be so owned shall be so disregarded.
ARTICLE II
CONVEYANCE OF THE CONTRACTS
SECTION 2.1 CONVEYANCE OF CONTRACTS AND RELATED ASSETS.
(a) Each of the Sellers hereby subscribes to purchase the
following number of shares of common stock, par value $.01 per share, of
Antigua, in consideration for the amount of capital to be contributed by
such Seller, all as specified below:
Leasing Services: $1,604,049,883.34 45.34 shares
Credit Corp.: $1,466,619,268.74 41.38 shares
NCR Credit: $ 264,236,058.58 7.43 shares
CFC: $ 170,225,456.83 4.85 shares
Antigua agrees that the capital to be contributed by any Seller may take
the form of assets.
(b) In satisfaction of its subscription agreement in Section
2.1(a) plus additional cash to be received from Antigua, each of the
Sellers hereby sells, transfers, assigns, and otherwise conveys to Antigua,
without recourse (but without limitation of its obligations in this
Agreement), and Antigua hereby acquires, all right, title and interest,
including security interests, whether now owned or hereafter acquired, of
each of the Sellers in and to the following:
(i) the Contracts, including, without limitation, (A) all monies
at any time paid or payable thereon or in respect thereof from and
after the Cut-Off Date, including but not limited to (1) Scheduled
Payments (including those Scheduled Payments due prior to, but not
received as of, the Cut-Off Date, but excluding those Scheduled
Payments due on or after, but received prior to, the
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Cut-Off Date), (2) Prepayments, (3) Liquidation Proceeds,
(4) Extension Fees, (5) payments to be applied by the Servicer to the
payment of insurance charges, maintenance, taxes or other similar
obligations, and (6) payments to be retained by the Servicer in
payment of Administrative Fees, (B) all security interests of the
lessor or secured party, as the case may be, in the related Equipment
and all present or future leases and other contracts relating to the
Equipment and all revenues, payments, rights to payment, profits,
accounts, chattel paper, products and contract rights arising from or
related to the Equipment or any use thereof or from any such lease or
other contract, (C) all rights of the lessor or secured party, as the
case may be, in all Insurance Policies and all other security for the
payment of amounts due under the Contracts (including all rights, if
any, the lessor or the secured party may have against vendors and
other third parties for payments of such amounts), (D) all items
contained in the related Contract Files and any and all other
documents that are kept on file in accordance with the applicable
Seller's customary procedures relating to the Contracts, and (E) any
and all proceeds of any and all of the foregoing; and
(ii) the Leased Equipment and all proceeds thereof, including in
any event and without limitation, all present and future leases and
other contracts relating to the Leased Equipment and all revenues,
payments, rights to payment, profits, accounts, chattel paper,
products and contract rights arising from or related to the Leased
Equipment or any use thereof or from any such lease or other contract,
and any and all proceeds of any and all of the foregoing.
(C) ANTIGUA ACKNOWLEDGES THAT THE SELLERS ARE TRANSFERRING THE
LEASED EQUIPMENT "AS-IS, WHERE-IS," AND THAT THE SELLERS MAKE NO
REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO THE LEASED EQUIPMENT,
INCLUDING WITHOUT LIMITATION ITS MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.
SECTION 2.2 INTENTION OF THE PARTIES. The execution and
delivery of this Agreement shall constitute an acknowledgment by each of
the Sellers, TCC and Antigua that they intend that each assignment and
transfer herein contemplated constitute a sale and assignment outright, and
not for security, of the property described in Section 2.1(b), conveying
good title thereto free and clear of any Liens, from the Sellers to
Antigua, and that all such property shall not be a part of the estate of
any Seller or TCC in the event of the bankruptcy, reorganization,
arrangement, insolvency or liquidation proceeding, or other proceeding
under any federal or state bankruptcy or similar law, or the occurrence of
another similar event, of, or with respect to, any Seller or TCC. In the
event that such conveyance is determined to be made as security for a loan
made by Antigua, the Trust, the Equity Certificateholders or the
Noteholders to the Sellers or TCC, the Sellers and TCC hereby grant to
Antigua a security interest in all of the Sellers' and TCC's right, title
and interest in and to the property described in Section 2.1(b) to secure
the loan determined to have been made to
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the Sellers or TCC and the payment and performance of the other obligations
of the Sellers and TCC under this Agreement, and agree that in such event
this Agreement shall constitute a security agreement under applicable law.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1 REPRESENTATIONS AND WARRANTIES OF TCC. TCC makes
the following representations and warranties, on which Antigua relies in
purchasing the Contracts and in transferring the Contracts to the Trust
under the Transfer and Servicing Agreement. Such representations are made
as of the Closing Date, but shall survive the sale, transfer and assignment
of the Contracts hereunder and the transfer of the Contracts by Antigua to
the Trust under the Transfer and Servicing Agreement. TCC and Antigua
agree that Antigua will assign to the Trust all of Antigua's rights under
this Agreement at the Closing Date and that the Trust will thereafter be
entitled to enforce this Agreement against TCC in the Trust's own name.
(a) SCHEDULE OF REPRESENTATIONS. With respect to each Contract,
the representations and warranties set forth on the Schedule of
Representations are true and correct as of the date specified therein.
(b) ORGANIZATION AND GOOD STANDING. TCC has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware, with power and authority to
own its properties and to conduct its business as such properties are
currently owned and such business is currently conducted, and had at
all relevant times, and now has, power, authority and legal right to
acquire, own and sell the Contracts transferred to Antigua.
(c) DUE QUALIFICATION. TCC is duly qualified to do business as
a foreign corporation in good standing, and has obtained all necessary
licenses and approvals, in each jurisdiction in which the ownership or
lease of its property or the conduct of its business requires such
qualification and in which the failure to so qualify would have a
material adverse impact on its business or financial condition.
(d) POWER AND AUTHORITY. TCC has the power and authority to
execute and deliver this Agreement and its Related Documents and to
carry out its terms and their terms, respectively, and the execution,
delivery and performance of this Agreement and all of TCC's Related
Documents have been duly authorized by TCC by all necessary corporate
action.
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(e) NO CONSENTS. TCC holds all necessary licenses, certificates
and permits from all government authorities necessary for conducting
its business as it is presently conducted, and is not required to
obtain the consent of any other party or any consent, license,
approval or authorization from, or registration or declaration with,
any governmental authority, bureau or agency in connection with the
execution, delivery, performance, validity or enforceability of this
Agreement, except for such consents, licenses, approvals or
authorizations, or registrations or declarations, as shall have been
obtained or filed, as the case may be, prior to the Closing Date.
(f) VALID SALE; BINDING OBLIGATIONS. This Agreement and each of
TCC's Related Documents have been duly executed and delivered, and
effect a valid sale, transfer and assignment of the Contracts and the
Originator's interest in the related Equipment, enforceable against
TCC, and creditors of and purchasers from TCC; and this Agreement and
each of TCC's Related Documents constitute legal, valid and binding
obligations of TCC, enforceable in accordance with their respective
terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally and by equitable
limitations on the availability of specific remedies, regardless of
whether such enforceability is considered in a proceeding in equity or
at law.
(g) NO VIOLATION. The execution and delivery of this Agreement,
the consummation of the transactions contemplated by this Agreement
and the Related Documents and the fulfillment of the terms of this
Agreement and the Related Documents shall 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, or both) a default under, the
certificate of incorporation or bylaws of TCC, or any indenture,
agreement, mortgage, deed of trust or other instrument to which TCC is
a party or by which it is bound, or result in the creation or
imposition of any Lien upon any of its properties pursuant to the
terms of any such indenture, agreement, mortgage, deed of trust or
other instrument, other than this Agreement, the Transfer and
Servicing Agreement and the Indenture, or violate any law, order, rule
or regulation applicable to TCC of any court or of any federal or
state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over TCC or any of its properties.
(h) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to the knowledge of TCC, threatened against TCC, before
any court, regulatory body, administrative agency or other tribunal or
governmental instrumentality having jurisdiction over TCC or any
properties of TCC (i) asserting the invalidity of this Agreement or
any of the Related Documents, (ii) seeking to prevent the issuance of
the Notes or the Equity Certificates or the consummation of any of the
transactions contemplated by this Agreement or any of the Related
Documents, (iii) seeking any determination or ruling that might
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materially and adversely affect the performance by TCC of its
obligations under, or the validity or enforceability of, this
Agreement or any of the Related Documents or (iv) seeking to affect
adversely the federal income tax or other federal, state or local tax
attributes of, or seeking to impose any excise, franchise, transfer or
similar tax upon, the transfer and acquisition of the Contracts
hereunder or under the Transfer and Servicing Agreement.
(i) CHIEF EXECUTIVE OFFICES. The chief executive office of TCC
is located at 44 Whippany Road, Morristown, New Jersey, and the
offices where TCC keeps its records concerning the Contracts and
related documents are in Morristown, New Jersey.
SECTION 3.2 REPRESENTATIONS AND WARRANTIES OF LEASING SERVICES.
Leasing Services makes the following representations and warranties, on
which Antigua relies in purchasing the Contracts and in transferring the
Contracts to the Trust under the Transfer and Servicing Agreement. Such
representations are made as of the Closing Date, but shall survive the
sale, transfer and assignment of the Contracts hereunder and the transfer
thereof by Antigua to the Trust under the Transfer and Servicing Agreement.
Leasing Services and Antigua agree that Antigua will assign to the Trust
all of Antigua's rights under this Agreement and that the Trust will
thereafter be entitled to enforce this Agreement against Leasing Services
in the Trust's own name.
(a) SCHEDULE OF REPRESENTATIONS. With respect to each Contract
sold by Leasing Services to Antigua hereunder, the representations and
warranties set forth on the Schedule of Representations are true and
correct as of the date specified therein.
(b) ORGANIZATION AND GOOD STANDING. Leasing Services has been
duly organized and is validly existing as a corporation in good
standing under the laws of the Commonwealth of Massachusetts, with
power and authority to own its properties and to conduct its business
as such properties are currently owned and such business is currently
conducted, and had at all relevant times, and now has, power,
authority and legal right to acquire, own and sell the Contracts sold
by Leasing Services to Antigua hereunder.
(c) DUE QUALIFICATION. Leasing Services is duly qualified to do
business as a foreign corporation in good standing, and has obtained
all necessary licenses and approvals, in each jurisdiction in which
the ownership or lease of its property or the conduct of its business
requires such qualification and in which the failure to so comply
would have a material adverse impact on its business or financial
condition.
(d) POWER AND AUTHORITY. Leasing Services has the power and
authority to execute and deliver this Agreement and its Related
Documents and to carry out its terms and their terms, respectively;
Leasing Services has full
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power and authority to sell and assign the Contracts to be sold and
assigned to and deposited with Antigua hereunder and has duly
authorized such sale and assignment to Antigua by all necessary
corporate action; and the execution, delivery and performance of this
Agreement and all of Leasing Services's Related Documents have been
duly authorized by Leasing Services by all necessary corporate action.
(e) NO CONSENTS. Leasing Services holds all necessary licenses,
certificates and permits from all government authorities necessary for
conducting its business as it is presently conducted, and is not
required to obtain the consent of any other party or any consent,
license, approval or authorization from, or registration or
declaration with, any governmental authority, bureau or agency in
connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents, licenses,
approvals or authorizations, or registrations or declarations, as
shall have been obtained or filed, as the case may be, prior to the
Closing Date.
(f) VALID SALE; BINDING OBLIGATIONS. This Agreement and each of
Leasing Services's Related Documents have been duly executed and
delivered, and effect a valid sale, transfer and assignment of the
Contracts and Leasing Services' interest in the related Equipment,
enforceable against Leasing Services, and creditors of and purchasers
from Leasing Services; and this Agreement and each of Leasing
Services's Related Documents constitute legal, valid and binding
obligations of Leasing Services, enforceable in accordance with their
respective terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting
the enforcement of creditors' rights generally and by equitable
limitations on the availability of specific remedies, regardless of
whether such enforceability is considered in a proceeding in equity or
at law.
(g) NO VIOLATION. The execution and delivery of this Agreement,
the consummation of the transactions contemplated by this Agreement
and the Related Documents and the fulfillment of the terms of this
Agreement and the Related Documents shall 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, or both) a default under, the
articles of incorporation or bylaws of Leasing Services, or any
indenture, agreement, mortgage, deed of trust or other instrument to
which Leasing Services is a party or by which it is bound, or result
in the creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such indenture, agreement, mortgage, deed
of trust or other instrument, other than this Agreement, the Transfer
and Servicing Agreement and the Indenture, or violate any law, order,
rule or regulation applicable to Leasing Services of any court or of
any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over Leasing Services
or any of its properties.
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<PAGE>
(h) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to the knowledge of Leasing Services, threatened against
Leasing Services, before any court, regulatory body, administrative
agency or other tribunal or governmental instrumentality having
jurisdiction over Leasing Services or any properties of Leasing
Services (i) asserting the invalidity of this Agreement or any of the
Related Documents, (ii) seeking to prevent the issuance of the Notes
or the Equity Certificates or the consummation of any of the
transactions contemplated by this Agreement or any of the Related
Documents, (iii) seeking any determination or ruling that might
materially and adversely affect the performance by Leasing Services of
its obligations under, or the validity or enforceability of, this
Agreement or any of the Related Documents or (iv) seeking to affect
adversely the federal income tax or other federal, state or local tax
attributes of, or seeking to impose any excise, franchise, transfer or
similar tax upon, the transfer and acquisition of the Contracts
hereunder or under the Transfer and Servicing Agreement.
(i) CHIEF EXECUTIVE OFFICES. The chief executive office of
Leasing Services is located at 550 Cochituate Road, Framingham,
Massachusetts, and the offices where Leasing Services keeps its
records concerning the Contracts and related documents are in
Framingham, Massachusetts.
SECTION 3.3 REPRESENTATIONS AND WARRANTIES OF CREDIT CORP.
Credit Corp. makes the following representations and warranties, on which
Antigua relies in purchasing the Contracts and in transferring the
Contracts to the Trust under the Transfer and Servicing Agreement. Such
representations are made as of the Closing Date but shall survive the sale,
transfer and assignment of the Contracts hereunder and the transfer thereof
by Antigua to the Trust under the Transfer and Servicing Agreement. Credit
Corp. and Antigua agree that Antigua will assign to the Trust all of
Antigua's rights under this Agreement and that the Trust will thereafter be
entitled to enforce this Agreement against Credit Corp. in the Trust's own
name.
(a) SCHEDULE OF REPRESENTATIONS. With respect to each Contract
sold by Credit Corp. to Antigua hereunder, the representations and
warranties set forth on the Schedule of Representations are true and
correct as of the date specified therein.
(b) ORGANIZATION AND GOOD STANDING. Credit Corp. has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware, with power and authority to
own its properties and to conduct its business as such properties are
currently owned and such business is currently conducted, and had at
all relevant times, and now has, power, authority and legal right to
acquire, own and sell the Contracts sold by Credit Corp. to Antigua
hereunder.
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<PAGE>
(c) DUE QUALIFICATION. Credit Corp. is duly qualified to do
business as a foreign corporation in good standing, and has obtained
all necessary licenses and approvals, in each jurisdiction in which
the ownership or lease of its property or the conduct of its business
requires such qualification and in which the failure to so qualify
would have a material adverse impact on its business or financial
condition.
(d) POWER AND AUTHORITY. Credit Corp. has the power and
authority to execute and deliver this Agreement and its Related
Documents and to carry out its terms and their terms, respectively;
Credit Corp. has full power and authority to sell and assign the
Contracts to be sold and assigned to and deposited with Antigua
hereunder and has duly authorized such sale and assignment to Antigua
by all necessary corporate action; and the execution, delivery and
performance of this Agreement and all of Credit Corp.'s Related
Documents have been duly authorized by Credit Corp. by all necessary
corporate action.
(e) NO CONSENTS. Credit Corp. holds all necessary licenses,
certificates and permits from all government authorities necessary for
conducting its business as it is presently conducted, and is not
required to obtain the consent of any other party or any consent,
license, approval or authorization from, or registration or
declaration with, any governmental authority, bureau or agency in
connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents, licenses,
approvals or authorizations, or registrations or declarations, as
shall have been obtained or filed, as the case may be, prior to the
Closing Date.
(f) VALID SALE; BINDING OBLIGATIONS. This Agreement and each of
Credit Corp.'s Related Documents have been duly executed and
delivered, and effect a valid sale, transfer and assignment of the
Contracts and Credit Corp.'s interest in the related Equipment,
enforceable against Credit Corp., and creditors of and purchasers from
Credit Corp.; and this Agreement and each of Credit Corp.'s Related
Documents constitute legal, valid and binding obligations of Credit
Corp., enforceable in accordance with their respective terms, except
as enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights generally and by equitable limitations on the
availability of specific remedies, regardless of whether such
enforceability is considered in a proceeding in equity or at law.
(g) NO VIOLATION. The execution and delivery of this Agreement,
the consummation of the transactions contemplated by this Agreement
and the Related Documents and the fulfillment of the terms of this
Agreement and the Related Documents shall 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, or both) a default under, the
certificate of incorporation or bylaws of Credit Corp., or any
indenture, agreement, mortgage, deed of trust or other instrument to
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which Credit Corp. is a party or by which it is bound, or result in
the creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such indenture, agreement, mortgage, deed
of trust or other instrument, other than this Agreement, the Transfer
and Servicing Agreement and the Indenture, or violate any law, order,
rule or regulation applicable to Credit Corp. of any court or of any
federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over Credit Corp. or
any of its properties.
(h) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to the knowledge of Credit Corp., threatened against
Credit Corp., before any court, regulatory body, administrative agency
or other tribunal or governmental instrumentality having jurisdiction
over Credit Corp. or any properties of Credit Corp. (i) asserting the
invalidity of this Agreement or any of the Related Documents,
(ii) seeking to prevent the issuance of the Notes or the Equity
Certificates or the consummation of any of the transactions
contemplated by this Agreement or any of the Related Documents,
(iii) seeking any determination or ruling that might materially and
adversely affect the performance by Credit Corp. of its obligations
under, or the validity or enforceability of, this Agreement or any of
the Related Documents or (iv) seeking to affect adversely the federal
income tax or other federal, state or local tax attributes of, or
seeking to impose any excise, franchise, transfer or similar tax upon,
the transfer and acquisition of the Contracts hereunder or under the
Transfer and Servicing Agreement.
(i) CHIEF EXECUTIVE OFFICES. The chief executive office of
Credit Corp. is located at 2 Gatehall Drive, Parsippany, New Jersey
and the offices where Credit Corp. keeps its records concerning the
Contracts and related documents are in Parsippany, New Jersey.
SECTION 3.4 REPRESENTATIONS AND WARRANTIES OF NCR CREDIT. NCR
Credit makes the following representations and warranties, on which Antigua
relies in purchasing the Contracts and in transferring the Contracts to the
Trust under the Transfer and Servicing Agreement. Such representations are
made as of the Closing Date but shall survive the sale, transfer and
assignment of the Contracts hereunder and the transfer thereof by Antigua
to the Trust under the Transfer and Servicing Agreement. NCR Credit and
Antigua agree that Antigua will assign to the Trust all of Antigua's rights
under this Agreement and that the Trust will thereafter be entitled to
enforce this Agreement against NCR Credit in the Trust's own name.
(a) SCHEDULE OF REPRESENTATIONS. With respect to each Contract
sold by NCR Credit to Antigua hereunder, the representations and
warranties set forth on the Schedule of Representations are true and
correct as of the date specified therein.
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<PAGE>
(b) ORGANIZATION AND GOOD STANDING. NCR Credit has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware, with power and authority to
own its properties and to conduct its business as such properties are
currently owned and such business is currently conducted, and had at
all relevant times, and now has, power, authority and legal right to
acquire, own and sell the Contracts sold by NCR Credit to Antigua
hereunder.
(c) DUE QUALIFICATION. NCR Credit is duly qualified to do
business as a foreign corporation in good standing, and has obtained
all necessary licenses and approvals, in each jurisdiction in which
the ownership or lease of its property or the conduct of its business
requires such qualification and in which the failure to so qualify
would have a material adverse impact on its business or financial
condition.
(d) POWER AND AUTHORITY. NCR Credit has the power and authority
to execute and deliver this Agreement and its Related Documents and to
carry out its terms and their terms, respectively; NCR Credit has full
power and authority to sell and assign the Contracts to be sold and
assigned to and deposited with Antigua hereunder and has duly
authorized such sale and assignment to Antigua by all necessary
corporate action; and the execution, delivery and performance of this
Agreement and all of NCR Credit's Related Documents have been duly
authorized by NCR Credit by all necessary corporate action.
(e) NO CONSENTS. NCR Credit holds all necessary licenses,
certificates and permits from all government authorities necessary for
conducting its business as it is presently conducted, and is not
required to obtain the consent of any other party or any consent,
license, approval or authorization from, or registration or
declaration with, any governmental authority, bureau or agency in
connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents, licenses,
approvals or authorizations, or registrations or declarations, as
shall have been obtained or filed, as the case may be, prior to the
Closing Date.
(f) VALID SALE; BINDING OBLIGATIONS. This Agreement and each of
NCR Credit's Related Documents have been duly executed and delivered,
and effect a valid sale, transfer and assignment of the Contracts and
NCR Credit's interest in the related Equipment, enforceable against
NCR Credit, and creditors of and purchasers from NCR Credit; and this
Agreement and each of NCR Credit's Related Documents constitute legal,
valid and binding obligations of NCR Credit, enforceable in accordance
with their respective terms, except as enforceability may be limited
by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and by
equitable limitations on the availability of specific remedies,
regardless of whether such enforceability is considered in a
proceeding in equity or at law.
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<PAGE>
(g) NO VIOLATION. The execution and delivery of this Agreement,
the consummation of the transactions contemplated by this Agreement
and the Related Documents and the fulfillment of the terms of this
Agreement and the Related Documents shall 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, or both) a default under, the
certificate of incorporation or bylaws of NCR Credit, or any
indenture, agreement, mortgage, deed of trust or other instrument to
which NCR Credit is a party or by which it is bound, or result in the
creation or imposition of any Lien upon any of its properties pursuant
to the terms of any such indenture, agreement, mortgage, deed of trust
or other instrument, other than this Agreement, the Transfer and
Servicing Agreement and the Indenture, or violate any law, order, rule
or regulation applicable to NCR Credit of any court or of any federal
or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over NCR Credit or any of its
properties.
(h) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to the knowledge of NCR Credit, threatened against NCR
Credit, before any court, regulatory body, administrative agency or
other tribunal or governmental instrumentality having jurisdiction
over NCR Credit or any properties of NCR Credit (i) asserting the
invalidity of this Agreement or any of the Related Documents,
(ii) seeking to prevent the issuance of the Notes or the Equity
Certificates or the consummation of any of the transactions
contemplated by this Agreement or any of the Related Documents,
(iii) seeking any determination or ruling that might materially and
adversely affect the performance by NCR Credit of its obligations
under, or the validity or enforceability of, this Agreement or any of
the Related Documents or (iv) seeking to affect adversely the federal
income tax or other federal, state or local tax attributes of, or
seeking to impose any excise, franchise, transfer or similar tax upon,
the transfer and acquisition of the Contracts hereunder or under the
Transfer and Servicing Agreement.
(i) CHIEF EXECUTIVE OFFICES. The chief executive office of NCR
Credit is located at 2 Gatehall Drive, Parsippany, New Jersey, and the
offices where NCR Credit keeps its records concerning the Contracts
and related documents are in Parsippany, New Jersey.
SECTION 3.5 REPRESENTATIONS AND WARRANTIES OF CFC. CFC makes
the following representations and warranties, on which Antigua relies in
purchasing the Contracts and in transferring the Contracts to the Trust
under the Transfer and Servicing Agreement. Such representations are made
as of the Closing Date but shall survive the sale, transfer and assignment
of the Contracts hereunder and the transfer thereof by Antigua to the Trust
under the Transfer and Servicing Agreement. CFC and Antigua agree that
Antigua will assign to the Trust all of Antigua's rights under this
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Agreement and that the Trust will thereafter be entitled to enforce this
Agreement against CFC in the Trust's own name.
(a) SCHEDULE OF REPRESENTATIONS. With respect to each Contract
sold by CFC to Antigua hereunder, the representations and warranties
set forth on the Schedule of Representations are true and correct as
of the date specified therein.
(b) ORGANIZATION AND GOOD STANDING. CFC has been duly organized
and is validly existing as a corporation in good standing under the
laws of the State of Delaware, with power and authority to own its
properties and to conduct its business as such properties are
currently owned and such business is currently conducted, and had at
all relevant times, and now has, power, authority and legal right to
acquire, own and sell the Contracts sold by CFC to Antigua hereunder.
(c) DUE QUALIFICATION. CFC is duly qualified to do business as
a foreign corporation in good standing, and has obtained all necessary
licenses and approvals, in each jurisdiction in which the ownership or
lease of its property or the conduct of its business requires such
qualification and in which the failure to so qualify would have a
material adverse impact on its business or financial condition.
(d) POWER AND AUTHORITY. CFC has the power and authority to
execute and deliver this Agreement and its Related Documents and to
carry out its terms and their terms, respectively; CFC has full power
and authority to sell and assign the Contracts to be sold and assigned
to and deposited with Antigua hereunder and has duly authorized such
sale and assignment to Antigua by all necessary corporate action; and
the execution, delivery and performance of this Agreement and all of
CFC's Related Documents have been duly authorized by CFC by all
necessary corporate action.
(e) NO CONSENTS. CFC holds all necessary licenses, certificates
and permits from all government authorities necessary for conducting
its business as it is presently conducted, and is not required to
obtain the consent of any other party or any consent, license,
approval or authorization from, or registration or declaration with,
any governmental authority, bureau or agency in connection with the
execution, delivery, performance, validity or enforceability of this
Agreement, except for such consents, licenses, approvals or
authorizations, or registrations or declarations, as shall have been
obtained or filed, as the case may be, prior to the Closing Date.
(f) VALID SALE; BINDING OBLIGATIONS. This Agreement and each of
CFC's Related Documents have been duly executed and delivered, and
effect a valid sale, transfer and assignment of the Contracts and
CFC's interest in the related Equipment, enforceable against CFC, and
creditors of and purchasers from CFC;
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and this Agreement and each of CFC's Related Documents constitute
legal, valid and binding obligations of CFC, enforceable in accordance
with their respective terms, except as enforceability may be limited
by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and by
equitable limitations on the availability of specific remedies,
regardless of whether such enforceability is considered in a
proceeding in equity or at law.
(g) NO VIOLATION. The execution and delivery of this Agreement,
the consummation of the transactions contemplated by this Agreement
and the Related Documents and the fulfillment of the terms of this
Agreement and the Related Documents shall 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, or both) a default under, the
certificate of incorporation or bylaws of CFC, or any indenture,
agreement, mortgage, deed of trust or other instrument to which CFC is
a party or by which it is bound, or result in the creation or
imposition of any Lien upon any of its properties pursuant to the
terms of any such indenture, agreement, mortgage, deed of trust or
other instrument, other than this Agreement, the Transfer and
Servicing Agreement and the Indenture, or violate any law, order, rule
or regulation applicable to CFC of any court or of any federal or
state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over CFC or any of its properties.
(h) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to the knowledge of CFC, threatened against CFC, before
any court, regulatory body, administrative agency or other tribunal or
governmental instrumentality having jurisdiction over CFC or any
properties of CFC (i) asserting the invalidity of this Agreement or
any of the Related Documents, (ii) seeking to prevent the issuance of
the Notes or the Equity Certificates or the consummation of any of the
transactions contemplated by this Agreement or any of the Related
Documents, (iii) seeking any determination or ruling that might
materially and adversely affect the performance by CFC of its
obligations under, or the validity or enforceability of, this
Agreement or any of the Related Documents or (iv) seeking to affect
adversely the federal income tax or other federal, state or local tax
attributes of, or seeking to impose any excise, franchise, transfer or
similar tax upon, the transfer and acquisition of the Contracts
hereunder or under the Transfer and Servicing Agreement.
(i) CHIEF EXECUTIVE OFFICES. The chief executive office of CFC
is located at 44 Whippany Road, Morristown, New Jersey, and the
offices where CFC keeps its records concerning the Contracts and
related documents are in Morristown, New Jersey.
SECTION 3.6 REPRESENTATIONS AND WARRANTIES OF ANTIGUA. Antigua
makes the following representations and warranties, on which each of the
Sellers and
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TCC relies in selling, assigning, transferring and conveying the Contracts
to Antigua hereunder. Such representations are made as of the Closing Date
but shall survive the sale, transfer and assignment of the Contracts
hereunder and the transfer thereof by Antigua to the Trust under the
Transfer and Servicing Agreement.
(a) ORGANIZATION AND GOOD STANDING. Antigua has been duly
organized and is validly existing and in good standing as a
corporation under the laws of the State of Delaware, with the power
and authority to own its properties and to conduct its business as
such properties are currently owned and such business is currently
conducted, and had at all relevant times, and has, full power,
authority and legal right to acquire and own the Contracts and to
transfer the Contracts to the Trust pursuant to the Transfer and
Servicing Agreement.
(b) DUE QUALIFICATION. Antigua is duly qualified to do business
as a foreign corporation in good standing, and has obtained all
necessary licenses and approvals in each jurisdiction where the
failure to do so would materially and adversely affect (i) Antigua's
ability to acquire the Contracts, (ii) the validity or enforceability
of the Contracts or (iii) Antigua's ability to perform its obligations
hereunder and under the Related Documents.
(c) POWER AND AUTHORITY. Antigua has the power and authority to
execute and deliver this Agreement and its Related Documents and to
carry out its terms and their terms, respectively, and to acquire the
Contracts and the Equipment; and the execution, delivery and
performance of this Agreement and its Related Documents and all of the
documents required pursuant hereto or thereto have been duly
authorized by Antigua by all necessary action.
(d) NO CONSENTS. Antigua holds all necessary licenses,
certificates and permits from all government authorities necessary for
conducting its business as it is presently conducted, and is not
required to obtain the consent of any other party or any consent,
license, approval or authorization from, or registration or
declaration with, any governmental authority, bureau or agency in
connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents, licenses,
approvals or authorizations, or registrations or declarations, as
shall have been obtained or filed, as the case may be, prior to the
Closing Date.
(e) BINDING OBLIGATION. This Agreement and each of Antigua's
Related Documents constitutes a legal, valid and binding obligation of
Antigua, enforceable against Antigua in accordance with its terms; and
this Agreement and each of Antigua's Related Documents constitute
legal, valid and binding obligations of Antigua, enforceable in
accordance with their respective terms, except as enforceability may
be limited by bankruptcy, insolvency, reorganization or other similar
laws affecting the enforcement of creditors' rights
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generally and by equitable limitations on the availability of specific
remedies, regardless of whether such enforceability is considered in a
proceeding in equity or at law.
(f) NO VIOLATION. The execution, delivery and performance by
Antigua of this Agreement, the consummation of the transactions
contemplated by this Agreement and the Related Documents and the
fulfillment of the terms of this Agreement and the Related Documents
do not and will 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, or both) a default under the certificate of incorporation or
bylaws of Antigua, or any indenture, agreement, mortgage, deed of
trust or other instrument to which Antigua is a party or by which
Antigua is bound or to which any of its properties are subject, or
result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement,
mortgage, deed of trust or other instrument (other than the Transfer
and Servicing Agreement and the Indenture), or violate any law, order,
rule or regulation, applicable to Antigua or its properties, of any
federal or state regulatory body or any court, administrative agency,
or other governmental instrumentality having jurisdiction over Antigua
or any of its properties.
(g) NO PROCEEDINGS. There are no proceedings or investigations
pending, or, to the knowledge of Antigua, threatened against Antigua,
before any court, regulatory body, administrative agency, or other
tribunal or governmental instrumentality having jurisdiction over
Antigua or its properties: (i) asserting the invalidity of this
Agreement or any of the Related Documents, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement
or any of the Related Documents, (iii) seeking any determination or
ruling that might materially and adversely affect the performance by
Antigua of its obligations under, or the validity or enforceability
of, this Agreement or any of the Related Documents or (iv) that may
adversely affect the federal or state income tax attributes of, or
seeking to impose any excise, franchise, transfer or similar tax upon,
the transfer and acquisition of the Contracts hereunder or the
transfer of the Contracts to the Trust pursuant to the Transfer and
Servicing Agreement.
(h) CHIEF EXECUTIVE OFFICES. The chief executive office of
Antigua is located at 44 Whippany Road, Morristown, New Jersey, and
the offices where Antigua keeps its records concerning the Contracts
and related documents are in Morristown, New Jersey.
In the event of any breach of a representation and warranty made by Antigua
hereunder, each of the Sellers and TCC covenants and agrees that (i) it
will not take any action or pursue any remedy that it may have hereunder,
in law, in equity or otherwise, until a year and a day have passed since
the date on which all Notes and Certificates issued by the Trust, or a
trust or similar vehicle formed by Antigua, have been paid in
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full, and (ii) any remedy it may have hereunder is subject to Section 6.12.
Each of the Sellers, TCC and Antigua agree that damages will not be an
adequate remedy for breach of the foregoing covenant and that this covenant
may be specifically enforced by Antigua or by the Owner Trustee on behalf
of the Trust.
ARTICLE IV
COVENANTS OF THE SELLERS
SECTION 4.1 PROTECTION OF TITLE OF ANTIGUA AND THE TRUST.
(a) At or prior to the Closing Date, Leasing Services shall have
filed or caused to be filed UCC-1 financing statements, executed by Leasing
Services, as seller or debtor, naming Antigua as secured party and the
Trust as assignee and (i) describing the Contracts and other property
described in Section 2.1 as collateral, filed with the office of the
Secretary of State of the Commonwealth of Massachusetts and in the
appropriate filing office in Middlesex County, and (ii) describing the
Leased Equipment as collateral, filed with the appropriate filing office in
each jurisdiction where Leased Equipment is located (other than Tennessee
and Maryland). Leasing Services shall deliver (or cause to be delivered)
to Antigua, the Owner Trustee and the Indenture Trustee file-stamped copies
of, or filing receipts for, any document filed as provided above, as soon
as available following such filing. In the event that Leasing Services
fails to perform its obligations under this subsection, Antigua or the
Owner Trustee may do so at the expense of TCC.
(b) At or prior to the Closing Date, Credit Corp. shall have
filed or caused to be filed UCC-1 financing statements, executed by Credit
Corp., as seller or debtor, naming Antigua as secured party and the Trust
as assignee and (i) describing the Contracts and other property described
in Section 2.1 as collateral, with the office of the Secretary of State of
the State of New Jersey, and (ii) describing the Leased Equipment as
collateral, filed with the appropriate filing office in each jurisdiction
where Leased Equipment is located (other than Tennessee and Maryland).
Credit Corp. shall deliver (or cause to be delivered) to Antigua, the Owner
Trustee and the Indenture Trustee file-stamped copies of, or filing
receipts for, any document filed as provided above, as soon as available
following such filing. In the event that Credit Corp. fails to perform its
obligations under this subsection, Antigua or the Owner Trustee may do so
at the expense of TCC.
(c) At or prior to the Closing Date, NCR Credit shall have filed
or caused to be filed UCC-1 financing statements, executed by NCR Credit,
as seller or debtor, naming Antigua as secured party and the Trust as
assignee and (i) describing the Contracts and other property described in
Section 2.1 as collateral, with the office of the Secretary of State of the
State of New Jersey, and (ii) describing the Leased Equipment as
collateral, filed with the appropriate filing office in each jurisdiction
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where Leased Equipment is located (other than Tennessee and Maryland). NCR
Credit shall deliver (or cause to be delivered) to Antigua, the Owner
Trustee and the Indenture Trustee file-stamped copies of, or filing
receipts for, any document filed as provided above, as soon as available
following such filing. In the event that NCR Credit fails to perform its
obligations under this subsection, Antigua or the Owner Trustee may do so
at the expense of TCC.
(d) At or prior to the Closing Date, CFC shall have filed or
caused to be filed UCC-1 financing statements, executed by CFC, as seller
or debtor, naming Antigua as secured party and the Owner Trust as assignee
and (i) describing the Contracts and other property described in Section
2.1 as collateral, with the office of the Secretary of State of the State
of Oregon, and (ii) describing the Leased Equipment as collateral, filed
with the appropriate filing office in each jurisdiction where Leased
Equipment is located (other than Tennessee and Maryland). CFC shall
deliver (or cause to be delivered) to Antigua, the Owner Trustee and the
Indenture Trustee file-stamped copies of, or filing receipts for, any
document filed as provided above, as soon as available following such
filing. In the event that CFC fails to perform its obligations under this
subsection, Antigua or the Owner Trustee may do so at the expense of TCC.
(e) If any of the Sellers or TCC change its name, identity, or
corporate structure in any manner that would, could or might make any
financing statement or continuation statement filed by such Seller or TCC
(or by Antigua or the Owner Trustee on behalf of such Seller or TCC) in
accordance with paragraphs (a) - (d) above seriously misleading within the
meaning of Section 9-402(7) of the UCC, it shall give Antigua and the Owner
Trustee written notice thereof no later than 10 days following the
occurrence of such change, and shall file appropriate amendments to all
such previously filed financing statements and continuation statements
within the time period required by the UCC.
(f) If any of the Sellers or TCC relocate its principal
executive office and, as a result of such relocation, the applicable
provisions of the UCC would require the filing of any amendment of any
previously filed financing or continuation statement or of any new
financing statement, it shall give Antigua, the Indenture Trustee and the
Owner Trustee written notice thereof; and shall promptly file such
appropriate amendments or financing statements within the time period
required by the UCC.
(g) Each of the Sellers and TCC shall at all times maintain its
principal executive office, and any office from which it services
Contracts, within the United States of America.
(h) Each of the Sellers shall maintain its computer systems so
that, from and after the time of sale under this Agreement of the
Contracts, the Leased Equipment and the other items described in Section
2.1(b) to Antigua, and the conveyance of the Contracts by Antigua to the
Trust, the master computer records (including archives) of each of the
Sellers that shall refer to a Contract, any Leased
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Equipment or any of the other items described in Section 2.1(b) indicate
clearly that such Contract, Leased Equipment or other item described in
Section 2.1(b) has been sold to Antigua and that such Contract has been
conveyed by Antigua to the Trust. Indication of the Trust's ownership of a
Contract shall be deleted from or modified on any of the Sellers' computer
systems when, and only when, the Contract has been paid in full, liquidated
(including receipt of all recoveries reasonably expected to be collected)
or purchased by the Depositor or TCC.
(i) If at any time any of the Sellers shall propose to sell,
grant a security interest in, or otherwise transfer any interest in lease
contracts or loan contracts of a character similar to the Contracts to any
prospective purchaser, lender or other transferee, such Seller shall give
to such prospective purchaser, lender, or other transferee computer tapes,
records, or print-outs (including any restored from archives) that, if they
shall refer in any manner whatsoever to any Contract, shall indicate
clearly that such Contract has been sold to Antigua and is owned by the
Trust. Each Seller, TCC and Antigua agree that, if any one of them
receives an inquiry from a bona fide potential creditor regarding whether
any lease contract, loan contract or item of equipment is identified on the
Schedule of Contracts, they will instruct the Indenture Trustee to disclose
the contents of the Schedule of Contracts to such potential creditor in
accordance with the provisions of Section 11.17 of the Indenture.
(j) If any Seller receives payments in respect of Contracts, any
Leased Equipment or any of the other items described in Section 2.1(b),
such Seller agrees to pay or cause to be paid to the Servicer all such
payments as soon as practicable after identification thereof, but in no
event later than two Business Days after receipt thereof by such Seller.
(k) Each Seller shall notify Antigua and the Indenture Trustee
within three Business Days after becoming aware of any Lien on any
Contract, Leased Equipment or other item described in Section 2.1(b), other
than the conveyances hereunder or under the Transfer and Servicing
Agreement.
(l) Each Seller will promptly pay and discharge all taxes,
assessments, levies and other governmental charges imposed on it which may
materially and adversely affect any of the Contracts, Leased Equipment or
other items described in Section 2.1(b), or Antigua's rights with respect
thereto.
(m) Each Seller hereby agrees that it will perform its
obligations under the agreements relating to the Contracts in conformity
with its customary and usual policies and procedures relating to the
Contracts.
(n) No later than 10 days after the Closing Date, the Sellers
and TCC shall deliver to Antigua, the Owner Trustee and the Indenture
Trustee a written certification that all notifications and consents
required by paragraph (R) in the Schedule of Representations hereto have
been given or obtained, as applicable.
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SECTION 4.2 OTHER LIENS OR INTERESTS. Except for the
conveyances hereunder, with respect to any Contract, the Seller will not
sell, pledge, assign or transfer to any other Person, or grant, create,
incur, assume or suffer to exist any Lien on such Contract or any interest
therein, and such Seller shall defend the right, title, and interest of
Antigua and the Trust in and to such Contract against all claims of third
parties claiming through or under such Seller.
SECTION 4.3 COSTS AND EXPENSES. Each Seller and TCC shall pay
all reasonable costs and disbursements in connection with the performance
of its obligations hereunder and its Related Documents.
SECTION 4.4 INDEMNIFICATION.
Each of the Sellers, acting severally and not jointly, and TCC,
as applicable, shall defend, indemnify and hold harmless Antigua, the
Trust, the Owner Trustee, the Indenture Trustee, the Noteholders and the
Equity Certificateholders from and against:
(a) any and all costs, expenses, losses, damages, claims, and
liabilities, arising out of or resulting from any breach of any
representations and warranties of such Seller or TCC, as applicable,
contained herein (other than those set forth in the Schedule of
Representations, the exclusive remedies for which are specified in Section
5.1);
(b) any and all costs, expenses, losses, damages, claims, and
liabilities, arising out of or resulting from the use, ownership or
operation of any item of Equipment (notwithstanding the disclaimer of
Section 2.1(c)); and, in addition, each of the Sellers and TCC shall cause
Antigua and the Trust to be named as an additional insured under its
liability insurance policies;
(c) any and all costs, expenses, losses, damages, claims and
liabilities arising out of or resulting from any action taken, or failed to
be taken, by it in respect of any portion of the Trust Assets other than
any action taken in accordance with this Agreement or any Related Document;
(d) any taxes that may at any time be asserted against Antigua,
the Trust, the Owner Trustee, the Indenture Trustee, the Noteholders and
the Equity Certificateholders with respect to the transactions contemplated
in this Agreement, including, without limitation, any sales, gross
receipts, general corporation, tangible or intangible personal property,
privilege, or license taxes (but not including any taxes asserted with
respect to, and as of the date of, the sale, transfer and assignment of the
Contracts to Antigua and of the Trust Assets to the Trust or the issuance
and original sale of the Notes or the Equity Certificates, or asserted with
respect to ownership of the Contracts or the Trust Assets, which shall be
indemnified by the Sellers and TCC pursuant to clause (e) below), or
federal, state or other income taxes, arising out of
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distributions on the Notes or the Equity Certificates or transfer taxes
arising in connection with the transfer of the Notes or the Equity
Certificates) and costs and expenses in defending against the same, arising
or imposed against such Persons by reason of the acts to be performed by
such Seller or TCC, as applicable, under this Agreement;
(e) any taxes which may at any time be asserted against such
Persons with respect to, and as of the date of, the conveyance or ownership
of the Contracts and the conveyance or ownership of the Trust Assets under
the Purchase Agreement or the Transfer and Servicing Agreement or the
issuance and original sale of the Notes and the Equity Certificates,
including, without limitation, any sales, gross receipts, personal
property, tangible or intangible personal property, privilege or license
taxes (but not including any federal or other income taxes, including
franchise taxes, arising out of the transactions contemplated hereby or
transfer taxes arising in connection with the transfer of Notes or Equity
Certificates) and costs and expenses in defending against the same, arising
or imposed against such Persons;
(f) any and all costs, expenses, losses, claims, damages, and
liabilities to the extent that such cost, expense, loss, claim, damage, or
liability arose out of, or was imposed upon Antigua, the Owner Trustee, the
Trust, the Indenture Trustee, the Noteholders and the Equity
Certificateholders through the negligence, willful misfeasance, or bad
faith of such Seller or TCC, as applicable, in the performance of its
duties under this Agreement or by reason of reckless disregard of the
obligations and duties of such Seller or TCC, as applicable, under this
Agreement;
(g) any loss, liability or expense incurred by reason of the
violation by such Seller or TCC, as applicable, of federal or state
securities laws in connection with the registration or the sale of the
Notes and the Equity Certificates; and
(h) any loss, liability or expense imposed upon, or incurred by,
Antigua, the Owner Trustee, the Indenture Trustee, the Trust, the
Noteholders or the Equity Certificateholders as a result of the failure of
any Contract, or the sale of the related Equipment, to comply with all
requirements of applicable law, but only to the extent such loss, liability
or expense is not covered by the repurchase of such Contract and Equipment
as required by Section 5.1.
Indemnification under this Section 4.4 shall include reasonable
fees and expenses of counsel and expenses of litigation and shall survive
termination of the Trust. The indemnity obligations hereunder shall be in
addition to any obligation that any Seller or TCC, as applicable, may
otherwise have.
Promptly after receipt by an indemnified party under this Section
4.4 of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of
the commencement thereof; but the
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omission so to notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under
such subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with counsel satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof, the indemnifying
party shall not be liable to such indemnified party under such subsection
for any legal expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified
party, effect the settlement or compromise of, or consent to the entry of
any judgment with respect to, any pending or threatened action or claim in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to
such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act,
by or on behalf of any indemnified party.
SECTION 4.5 NEGATIVE COVENANT. TCC and the Sellers (a) shall
not engage in any transaction or series of transactions or otherwise take
any action or omit to take any action which could result in a determination
that any Seller shall have received less than reasonably equivalent value
for the transfer and conveyance of the Contracts and the other property
described in Section 2.1(b) to Antigua either on the Closing Date or
thereafter and (b) in any event, shall not use the proceeds received from
the transfer and conveyance of the Contracts and the other property
described in Section 2.1(b) either on the Closing Date or thereafter (i) to
pay any dividend or make any distribution on or in respect of its capital
stock or (ii) to purchase, redeem or otherwise acquire or retire for value
any of its capital stock or the capital stock of any of its affiliates
(other than any of its wholly owned subsidiaries or a corporation which by
virtue thereof would become a wholly owned subsidiary of the Seller), if,
in the case of either (i) or (ii), at the time of any such action and after
giving effect thereto (x) the present fair saleable value of the assets of
such Seller or TCC is less than the amount that would be required to be
paid on or in respect of such Seller's or TCC's total liabilities
(including a reasonable estimate of its contingent liabilities (net of tax
benefits to the extent reasonably likely to be realized)), (y) the assets
of such Seller or TCC constitute an unreasonably small capital to carry out
such Seller's or TCC's business as it is then conducted or as such Seller
or TCC then intends to conduct its business or (z) such Seller or TCC has
incurred, intends to incur, or believes that it will incur, debts that
would be beyond such Seller's or TCC's ability to pay as they mature.
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ARTICLE V
REPURCHASES
SECTION 5.1 REPURCHASE OF CONTRACTS UPON BREACH OF
REPRESENTATION OR WARRANTY. Upon the occurrence of a Repurchase Event, TCC
shall, unless such breach shall have been cured in all material respects,
repurchase such Contract from the Trust and the related Leased Equipment
(in the case of a Lease Contract) from Antigua and, on or before the
related Deposit Date, TCC shall pay the Purchase Amount to the Servicer on
behalf of the Owner Trustee and Antigua pursuant to Section 2.6 of the
Transfer and Servicing Agreement. It is understood and agreed that, except
as set forth in the following paragraph, the obligation of TCC to
repurchase any Contract and the related Leased Equipment (if applicable) as
to which a breach has occurred and is continuing shall, if such obligation
is fulfilled, constitute the sole remedy against TCC and the applicable
Seller for such breach available to Antigua, the Noteholders, the Equity
Certificateholders, the Owner Trustee on behalf of the Equity
Certificateholders or the Indenture Trustee on behalf of the Noteholders.
The provisions of this Section 5.1 are intended to grant the Owner Trustee
and the Indenture Trustee a direct right against TCC to demand performance
hereunder, and in connection therewith, TCC waives any requirement of prior
demand against Antigua or the Sellers with respect to such repurchase
obligation. Notwithstanding any other provision of this Agreement or the
Transfer and Servicing Agreement to the contrary, the obligation of TCC
under this Section shall not terminate upon a termination of TCC as
Servicer under the Transfer and Servicing Agreement and shall be performed
by TCC in accordance with the terms hereof notwithstanding the failure of
the Servicer or Antigua to perform any of their respective obligations with
respect to such Contract under the Transfer and Servicing Agreement.
In addition to the foregoing and notwithstanding whether the
related Contract and the related Leased Equipment (if applicable) shall
have been purchased by TCC, TCC shall indemnify Antigua, the Owner Trustee,
the Indenture Trustee, the Trust, the Noteholders and the Equity
Certificateholders against all costs, expenses, losses, damages, claims and
liabilities, including reasonable fees and expenses of counsel, which may
be asserted against or incurred by any of them as a result of third party
claims arising out of the events or facts giving rise to such Repurchase
Events.
SECTION 5.2 REASSIGNMENT OF PURCHASED CONTRACTS AND LEASED
EQUIPMENT. Upon deposit in the Collection Account of the Purchase Amount
of any Contract and the related Leased Equipment (if applicable)
repurchased by TCC under Section 5.1, Antigua and the Owner Trustee shall
take such steps as may be reasonably requested by TCC in order to assign to
TCC all of Antigua's and the Trust's right, title and interest in and to
such Contract and the related Leased Equipment (if applicable) and all
security and documents conveyed to Antigua and the Trust directly relating
thereto, without recourse, representation or warranty, except as to the
absence of liens, charges or encumbrances created by or arising as a result
of actions of Antigua or the
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<PAGE>
Owner Trustee. Such assignment shall be a sale and assignment outright,
and not for security. If, following the reassignment of a Purchased
Contract and the related Leased Equipment (if applicable), in any
enforcement suit or legal proceeding, it is held that TCC may not enforce
any such Contract on the ground that it shall not be a real party in
interest or a holder entitled to enforce the Contract, Antigua and the
Owner Trustee shall, at the expense of TCC, take such steps as TCC deems
reasonably necessary to enforce the Contract, including bringing suit in
Antigua's or the Owner Trustee's name or the name of the Indenture Trustee
on behalf of the Noteholders or Equity Certificateholders, as applicable.
SECTION 5.3 WAIVERS. No failure or delay on the part of
Antigua, the Trust or the Owner Trustee as assignee of Antigua, in
exercising any power, right or remedy under this Agreement shall operate as
a waiver thereof, nor shall any single or partial exercise of any such
power, right or remedy preclude any other or future exercise thereof or the
exercise of any other power, right or remedy.
ARTICLE VI
MISCELLANEOUS
SECTION 6.1 LIABILITY OF THE SELLERS AND TCC. Each of the
Sellers and TCC shall be liable in accordance herewith only to the extent
of the obligations in this Agreement specifically undertaken, individually
and not jointly, by each Seller and TCC, and the representations and
warranties of each Seller and TCC.
SECTION 6.2 MERGER OR CONSOLIDATION OF A SELLER, TCC OR ANTIGUA.
Any corporation or other entity (i) into which any Seller, TCC or Antigua
may be merged or consolidated, (ii) resulting from any merger or
consolidation to which any Seller, TCC or Antigua is a party or
(iii) succeeding to the business of any Seller, TCC or Antigua, shall be
the successor to such Seller, TCC or Antigua, as the case may be (without
relieving such Seller, TCC or Antigua of its responsibilities hereunder, if
it survives such merger or consolidation) without the execution or filing
of any document or any further act by any of the parties to this Agreement.
Such Seller, TCC or Antigua shall promptly inform the other parties, the
Owner Trustee and the Indenture Trustee of such merger, consolidation or
purchase and assumption. Notwithstanding the foregoing, as a condition to
the consummation of the transactions referred to in clauses (i), (ii) and
(iii) above, (x) immediately after giving effect to such transaction, no
representation or warranty made pursuant to Sections 3.1 (other than
subsections (a) and (i)), 3.2 (other than subsections (a) and (i)), 3.3
(other than subsections (a) and (i)), 3.4 (other than subsections (a) and
(i)), 3.5 (other than subsections (a) and (i)) and 3.6 (other than
subsection (h)) of this Agreement shall have been breached (for purposes
hereof, such representations and warranties shall speak as of the date of
the consummation of such transaction), (y) such Seller, TCC or Antigua, as
applicable, shall have delivered written notice of such consolidation,
merger or purchase and assumption to the Rating
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<PAGE>
Agencies prior to the consummation of such transaction and shall have
delivered to the Owner Trustee and the Indenture Trustee an Officer's
Certificate and an Opinion of Counsel each stating that such consolidation,
merger or succession and such agreement of assumption comply with this
Section 6.2 and that all conditions precedent, if any, provided for in this
Agreement, relating to such transaction have been complied with, and
(z) such Seller, TCC or Antigua, as applicable, shall have delivered to the
Owner Trustee and the Indenture Trustee an Opinion of Counsel, stating
that, in the opinion of such counsel, either (A) all financing statements
and continuation statements and amendments thereto have been executed and
filed that are necessary to preserve and protect the interest of the Owner
Trustee in the Trust Assets and reciting the details of the filings or
(B) no such action shall be necessary to preserve and protect such
interest.
SECTION 6.3 LIMITATION ON LIABILITY OF THE SELLERS, TCC AND
OTHERS.
(a) Except with respect to the Representations and Warranties
herein and in the Schedule of Representations, and the indemnification
obligations set forth in Section 4.4 herein, each Seller and TCC may rely
in good faith on the advice of counsel or on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising under this Agreement. Each Seller and TCC shall not be under any
obligation to appear in, prosecute or defend any legal action that is not
incidental to its obligations under this Agreement or its Related Documents
and that in its reasonable judgment may involve it in any expense or
liability.
(b) Any officer, director, employee or agent of TCC or any
Seller may rely in good faith on the advice of counsel or on any document
of any kind prima facie properly executed and submitted by any Person
respecting any matters arising under this Agreement. Neither any Seller
nor TCC shall be under any obligation to appear in, prosecute or defend any
legal action that is not incidental to its obligations under this Agreement
or its Related Documents and that in its reasonable judgment may involve it
in any expense or liability.
SECTION 6.4 THE SELLERS AND TCC MAY OWN NOTES OR EQUITY
CERTIFICATES. Subject to the provisions of the Transfer and Servicing
Agreement, each of the Sellers and TCC, and any Affiliate of any Seller or
TCC, may in its individual or any other capacity become the owner or
pledgee of Notes or Equity Certificates with the same rights as it would
have if it were not a Seller, TCC or an Affiliate thereof (except as
provided in Section 1.6).
SECTION 6.5 AMENDMENT.
(a) This Agreement may be amended by the Sellers, TCC and
Antigua without the consent of the Owner Trustee, the Indenture Trustee,
the Equity Certificateholders or the Noteholders (i) to cure any ambiguity;
(ii) to correct or supplement any provisions in this Agreement that may be
inconsistent with any other provisions herein; or (iii) to make any other
provisions with respect to matters or
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<PAGE>
questions arising under this Agreement that are not inconsistent with the
provisions hereof, PROVIDED, HOWEVER, that such action shall not, as
evidenced by an Opinion of Counsel delivered to the Owner Trustee and the
Indenture Trustee, adversely affect in any material respect the interests
of the Noteholders or Equity Certificateholders.
(b) This Agreement may also be amended from time to time by the
Sellers, TCC and Antigua, with the prior written consent of a Note Majority
and an Equity Certificate Majority (which consent of any Holder of an
Equity Certificate or Note given pursuant to this Section or pursuant to
any other provision of this Agreement shall be conclusive and binding on
such Holder and on all future Holders of such Equity Certificate or Note
and of any Equity Certificate or Note issued upon the transfer thereof or
in exchange thereof or in lieu thereof whether or not notation of such
consent is made upon the Equity Certificate or Note), for the purpose of
adding any provisions to or changing in any manner or eliminating any of
the provisions of this Agreement, or of modifying in any manner the rights
of the Equity Certificateholders or the Noteholders; PROVIDED, HOWEVER,
that no such amendment shall (i) increase or reduce in any manner the
amount of, or accelerate or delay the timing of, collections of payments on
Contracts, distributions that shall be required to be made on any Equity
Certificate or Note or the applicable rate of interest payable thereon,
(ii) amend any provisions of Section 5.06 or 8.03 of the Indenture in such
a manner as to affect the priority of payment of interest or principal to
Noteholders or Equity Certificateholders, or (iii) reduce the aforesaid
percentage required to consent to any such amendment or any waiver
hereunder, without the consent of the Holders of all Notes or Equity
Certificates then Outstanding and affected thereby; and PROVIDED, FURTHER,
that no such amendment shall be effective unless and until the Rating
Agency Condition has been satisfied.
(c) Promptly after the execution of any such amendment or
consent, the Owner Trustee or the Indenture Trustee, as applicable, shall
furnish written notification of the substance of such amendment or consent
to each Equity Certificateholder and Noteholder.
(d) It shall not be necessary for the consent of Equity
Certificateholders or Noteholders pursuant to this Section to approve the
particular form of any proposed amendment or consent, but it shall be
sufficient if such consent shall approve the substance thereof. The manner
of obtaining such consents (and any other consents of Equity
Certificateholders and Noteholders provided for in this Agreement) and of
evidencing the authorization of the execution thereof by Equity
Certificateholders or Noteholders shall be subject to such reasonable
requirements as the Owner Trustee or the Indenture Trustee, as applicable,
may prescribe, including the establishment of record dates. The consent of
any Holder of an Equity Certificate or Note given pursuant to this Section
or pursuant to any other provision of this Agreement shall be conclusive
and binding on such Holder and on all future Holders of such Equity
Certificate or Note and of any Equity Certificate or Note issued upon the
transfer
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<PAGE>
thereof or in exchange thereof or in lieu thereof whether or not notation
of such consent is made upon the Equity Certificate or Note.
SECTION 6.6 NOTICES. All demands, notices and communications to
the Sellers, TCC or Antigua hereunder shall be in writing, personally
delivered, or sent by telecopier (subsequently confirmed in writing),
reputable overnight courier or mailed by certified mail, return receipt
requested, and shall be deemed to have been given upon receipt:
(a) in the case of TCC, to AT&T Capital Corporation, 44 Whippany
Road, Morristown, New Jersey 07962-1983, Attention: General Counsel, or
such other address as shall be designated by TCC in a written notice
delivered to the other parties and to the Owner Trustee and the Indenture
Trustee;
(b) in the case of Leasing Services, to AT&T Capital
Corporation, 44 Whippany Road, Morristown, New Jersey 07962-1983,
Attention: General Counsel, or such other address as Leasing Services
shall be designated by a written notice delivered to the other parties and
to the Owner Trustee and the Indenture Trustee;
(c) in the case of Credit Corp., to AT&T Capital Corporation, 44
Whippany Road, Morristown, New Jersey 07962-1983, Attention: General
Counsel, or such other address as shall be designated by Credit Corp. in a
written notice delivered to the other parties and to the Owner Trustee and
the Indenture Trustee;
(d) in the case of NCR Credit, to AT&T Capital Corporation, 44
Whippany Road, Morristown, New Jersey 07962-1983, Attention: General
Counsel, or such other address as shall be designated by NCR Credit in a
written notice delivered to the other parties and to the Owner Trustee and
the Indenture Trustee;
(e) in the case of CFC, to AT&T Capital Corporation, 44 Whippany
Road, Morristown, New Jersey 07962-1983, Attention: General Counsel, or
such other address as CFC shall be designated by CFC in a written notice
delivered to the other parties and to the Owner Trustee and the Indenture
Trustee; and
(f) in the case of Antigua, to AT&T Capital Corporation, 44
Whippany Road, Morristown, New Jersey 07962-1983, Attention: General
Counsel.
SECTION 6.7 MERGER AND INTEGRATION. Except as specifically
stated otherwise herein, this Agreement and the Related Documents set forth
the entire understanding of the parties relating to the subject matter
hereof, and all prior understandings, written or oral, are superseded by
this Agreement and the Related Documents. This Agreement may not be
modified, amended, waived or supplemented except as provided herein.
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<PAGE>
SECTION 6.8 SEVERABILITY OF PROVISIONS. If any one or more of
the covenants, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, provisions or terms
shall be deemed severable from the remaining covenants, provisions or terms
of this Agreement and shall in no way affect the validity or enforceability
of the other provisions of this Agreement.
SECTION 6.9 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF, AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES UNDER THIS AGREEMENT SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.
SECTION 6.10 COUNTERPARTS. For the purpose of facilitating the
execution of this Agreement and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which
counterparts shall constitute but one and the same instrument.
SECTION 6.11 CONVEYANCE OF THE CONTRACTS TO THE TRUST. The
Sellers and TCC acknowledge that Antigua intends, pursuant to the Transfer
and Servicing Agreement, to convey the Contracts, the Leased Equipment and
the other items described in Section 2.1(b), together with its rights under
this Agreement, to the Trust on the Closing Date. The Sellers and TCC
acknowledge and consent to such conveyance and waive any further notice
thereof and covenant and agree that the representations and warranties of
the Sellers and TCC contained in this Agreement and the rights of Antigua
hereunder are intended to benefit the Owner Trustee, the Indenture Trustee,
the Trust, the Noteholders and the Equity Certificateholders. In
furtherance of the foregoing, the Sellers and TCC covenant and agree to
perform their duties and obligations hereunder, in accordance with the
terms hereof, for the benefit of the Owner Trustee, the Indenture Trustee,
the Trust, the Equity Certificateholders and the Noteholders and that,
notwithstanding anything to the contrary in this Agreement, the Sellers and
TCC shall be directly liable to the Owner Trustee, the Indenture Trustee
and the Trust (notwithstanding any failure by the Servicer or Antigua to
perform its duties and obligations hereunder or under the Transfer and
Servicing Agreement) and that the Owner Trustee and the Indenture Trustee
may enforce the duties and obligations of the Sellers or TCC under this
Agreement against the Sellers or TCC for the benefit of the Trust, the
Equity Certificateholders and the Noteholders.
SECTION 6.12 NONPETITION COVENANT. Neither the Sellers, TCC nor
Antigua shall petition or otherwise invoke the process of any court or
government authority for the purpose of commencing or sustaining a case
against the Trust (or, in the case of the Sellers or TCC, against Antigua)
under any federal or state bankruptcy, insolvency or similar law or
appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Trust (or Antigua) or any
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<PAGE>
substantial part of its property, or ordering the winding up or liquidation
of the affairs of the Trust (or Antigua).
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<PAGE>
IN WITNESS WHEREOF, the parties have caused this
Purchase and Sale Agreement to be duly executed by their respective
officers as of the day and year first above written.
ANTIGUA FUNDING CORPORATION,
as Purchaser
By /s/ James Elton
-----------------------------------------
Name: James Elton
Title: Vice President
AT&T CAPITAL CORPORATION,
In its individual capacity and as
Servicer
By /s/ Ramon Oliu, Jr.
-----------------------------------------
Name: Ramon Oliu, Jr.
Title: Vice President and Controller
AT&T CAPITAL LEASING SERVICES, INC.,
as a Seller
By /s/ Glenn A. Votek
-----------------------------------------
Name: Glenn A. Votek
Title: Assistant Treasurer
AT&T CREDIT CORPORATION,
as a Seller
By /s/ Glenn A. Votek
-----------------------------------------
Name: Glenn A. Votek
Title: Assistant Treasurer
NCR CREDIT CORP.,
as a Seller
By /s/ Glenn A. Votek
-----------------------------------------
Name: Glenn A. Votek
Title: Assistant Treasurer
AT&T COMMERCIAL FINANCE
CORPORATION, as a Seller
By /s/ Glenn A. Votek
-----------------------------------------
Name: Glenn A. Votek
Title: Assistant Treasurer
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<PAGE>
SCHEDULE A-1
SCHEDULE OF LEASE CONTRACTS AND LEASED EQUIPMENT
INTENTIONALLY
OMITTED
<PAGE>
SCHEDULE A-2
SCHEDULE OF LOAN CONTRACTS
INTENTIONALLY
OMITTED
<PAGE>
SCHEDULE B
SCHEDULE OF REPRESENTATIONS AND WARRANTIES
OF THE SELLERS AND TCC
With respect to each Contract as of the Cut-Off Date, the
applicable Seller and TCC represent and warrant as follows :
A. CHARACTERISTICS OF CONTRACTS. Each Contract (i) constitutes
a valid, binding and enforceable payment obligation of the Obligor in
accordance with its terms (except as may be limited by applicable
bankruptcy, insolvency or other similar laws affecting the enforceability
of creditors' rights generally and the availability of equitable remedies),
(ii) has been duly and properly sold, assigned and conveyed by the
applicable Seller to Antigua, (iii) was originated by one of the Sellers in
the ordinary course of such Seller's business, or (in the case of any
Contract purchased by one of the Sellers) was acquired by such Seller for
proper consideration and was validly assigned to such Seller by the
originator of such Contract, and (iv) contains customary and enforceable
provisions adequate to enable realization against the Obligor and/or the
related Equipment (although no representation or warranty is made with
respect to the perfection or priority of any security interest in such
related Equipment).
B. ADVERSE SELECTION. No selection procedures adverse to the
Noteholders or Equity Certificateholders were utilized in selecting the
Contract from those lease and loan contracts owned by the Seller on the
Cut-Off Date.
C. COMPLIANCE WITH LAW. All requirements of applicable
Federal, state and local laws, and regulations thereunder, in respect of
all of the Contracts, have been complied with in all material respects.
D. NO DEFAULT. There is no known default, breach, violation or
event permitting cancellation or termination of the Contract by the lessor
(in the case of Lease Contracts) or by the secured party (in the case of
Loan Contracts) under the terms of any Contract (other than Scheduled
Payment delinquencies (in excess of 10% of the Scheduled Payment due) of
not more than 59 days), and (except for payment extensions and waivers of
Administrative Fees in accordance with TCC's servicing and collections
policies and procedures) there has been no waiver of any of the foregoing;
and as of the Cut-Off Date, no related Equipment had been repossessed.
E. GOOD TITLE. Immediately prior to the sale, assignment and
conveyance of each Contract by a Seller to Antigua, such Seller had good
title to such Contract and the Seller's interest in the related Equipment
(subject to the terms of such Contract) and was the sole owner thereof,
free of any Lien (other than the rights of the Obligor under the related
Contract).
B-1
<PAGE>
F. NO IMPAIRMENT. No person has a participation in or other
right to receive Scheduled Payments under any Contract, and none of the
Sellers nor TCC has taken any action to convey any right to any Person that
would result in such Person having a right to Scheduled Payments received
with respect to any Contract.
G. NO FRAUD OR MISREPRESENTATION. Each Contract was originated
or purchased by a Seller and sold by such Seller to Antigua without any
fraud or misrepresentation on the part of such Seller or TCC.
H. THE OBLIGORS. Each Obligor (i) is located in the United
States, and (ii) is not (a) the United States of America or any State or
local government or any agency, department, subdivision or instrumentality
thereof or (b) Antigua, a Seller, TCC or any subsidiary thereof.
I. LAWFUL ASSIGNMENT. The sale, transfer and assignment of
such Contract and the Seller's interest in the related Equipment from a
Seller to Antigua under this Agreement, and the transfer and conveyance of
such Contract from, and grant of a security interest in the related
Equipment by, Antigua to the Trust under the Transfer and Servicing
Agreement, are not unlawful, void or voidable under the laws of the
jurisdiction applicable to such Contract.
J. ALL FILINGS MADE. All filings and other actions required to
be made, taken or performed by any Person in any jurisdiction to give
Antigua a first priority perfected lien or ownership interest in the
Contracts and a first priority perfected security interest in the Seller's
interest in the Equipment have been made, taken or performed.
K. CONTRACT FILES COMPLETE. There exists a Contract File
pertaining to each Contract, and such Contract File contains the Contract
or a facsimile copy thereof.
L. ONE ORIGINAL. There is only one original executed copy of
each Contract or, if there are multiple originals, all such originals are
in the possession of the Seller or the signed original in the possession of
the Seller is noted thereon as being the only copy that constitutes chattel
paper.
M. CHATTEL PAPER. The Contracts constitute chattel paper
within the meaning of the UCC as in effect in the States of New Jersey,
Massachusetts and Oregon (other than those Contracts in which the lessor is
financing exclusively the Obligor's software license or maintenance
contract for leased Equipment, which constitute either "accounts" or
"general intangibles" under the UCC, and which Contracts, in proportion to
the Initial Contract Pool Principal Balance, are not material).
N. OBLIGOR BANKRUPTCY. Each Contract was entered into by an
Obligor who, at the Cut-Off Date, had not been identified on the records of
TCC or the Sellers as being the subject of a current bankruptcy proceeding.
B-2
<PAGE>
O. COMPUTER TAPE. The Computer Tape containing information
with respect to the Contracts that was made available by Antigua to the
Owner Trustee and the Indenture Trustee on the Closing Date and was used to
select the Contracts was complete and accurate in all material respects as
of the Cut-Off Date and includes a description of the same Contracts that
are described in the Schedule of Contracts to the Transfer and Servicing
Agreement.
P. MARKING RECORDS. By the Closing Date, the portions of the
electronic master record of TCC and each Seller relating to the Contracts
will have been clearly and unambiguously marked to show that the Contracts
constitute part of the Trust Assets and are owned by the Trust in
accordance with the terms of the Transfer and Servicing Agreement.
Q. PAST DUE. No Contract has a Scheduled Payment delinquency
(in excess of 10% of the Scheduled Payment due) of more than 59 days past
due as of the Cut-Off Date (although some Contracts may have experienced
such delinquencies prior to the Cut-Off Date).
R. ASSIGNMENT TO THE OWNER TRUST. Each Contract may be sold,
assigned and transferred by the Seller to Antigua, and may be assigned and
transferred by Antigua to the Trust, without the consent of, or prior
approval from, or any notification to, the applicable Obligor, other than
(i) certain Contracts which, in proportion to the aggregate of all the
Contracts, are not material that require notification of the assignment to
the Obligor, which notification will have been given by the Servicer not
more than 10 days following the Closing Date and (ii) Contracts which, in
proportion to the aggregate of all the Contracts, are not material that
require the consent of the Obligor, which consent will have been obtained
not more than 10 days following the Closing Date.
S. CONTRACT NOT ASSUMABLE. Each Contract prohibits the sale,
assignment or transfer of the Obligor's interest therein, the assumption of
the Contract by another person in a manner that would release the Obligor
thereof from the Obligor's obligation, or any sale, assignment or transfer
of the related Equipment, without the prior consent of the lessor (in the
case of Lease Contracts) or the secured party (in the case of Loan
Contracts), other than Contracts which may (i) permit assignment to a
subsidiary, corporate parent or other affiliate, (ii) permit the assignment
to a third party, provided the Obligor remains liable under the Contract,
or (iii) permit assignment to a third party with a credit standing
(determined by TCC in accordance with its underwriting policy and practice
at the time for an equivalent contract type, term and amount) equal to or
better than the original Obligor.
T. PAYMENTS IN UNITED STATES DOLLARS. The Obligor under each
Contract is required to make payments thereunder (i) in United States
dollars, and (ii) in fixed amounts and on fixed and predetermined dates.
B-3
<PAGE>
U. MAINTENANCE AND REPAIR. Each Contract requires the Obligor
to assume responsibility for payment of all expenses in connection with the
maintenance and repair of the related Equipment, the payment of all
premiums for insurance of such Equipment and the payment of all taxes
(including sales and property taxes) relating to such Equipment.
V. SCHEDULED PAYMENTS. Each Contract requires the Obligor
thereunder to make all scheduled payments thereon under all circumstances
and regardless of the condition or suitability of the related Equipment and
notwithstanding any defense, set-off or counterclaim that the Obligor may
have against the manufacturer, lessor or lender (as the case may be).
W. REPAIR OR REPLACEMENT OF DAMAGED EQUIPMENT. Under each
Lease Contract, if the Equipment is damaged or destroyed, the Obligor is
required either (i) to repair such Equipment, (ii) to make a termination
payment to the lessor in an amount not less than the Required Payoff
Amount, or (iii) in some cases, to replace such damaged or destroyed
Equipment with other equipment of comparable use and value.
X. NO TERMINATION BY LESSEE. None of the Lease Contracts
permit the Obligor to terminate the Lease Contract prior to the latest
Stated Maturity Date or to otherwise prepay the amounts due and payable
thereunder except for a DE MINIMIS number of Lease Contracts which allow
for an early termination or prepayment upon payment of an amount which is
not less than the Required Payoff Amount.
Y. PREPAYMENT OPTION. Any Loan Contract that permits the
prepayment of the amount due thereunder, at the option of the Obligor,
requires that the prepayment in full must be in an amount not less than the
principal amount then outstanding plus accrued interest thereon to the date
of such prepayment.
Z. NO TRANSFER OF TITLE REQUIRED. It is not a precondition to
the valid transfer or assignment of the Seller's interest in any of the
Equipment related to any Contract that title to such Equipment be
transferred on the records of any governmental or quasi-governmental
agency, body or authority.
AA. SCHEDULE OF CONTRACTS. The information with respect to the
Contracts listed on the Schedule of Contracts attached to the Purchase
Agreement is true, correct and complete in all material respects.
BB. NO WAIVERS. No provisions of any Contract have been waived,
altered or modified in any material respect, except as indicated in the
Contract File.
CC. NO CONSUMER LEASES. No Lease Contract is a "consumer lease"
as defined in Article 2A of the UCC.
B-4
<PAGE>
DD. EQUIPMENT ACCEPTED. To the best of TCC's or the applicable
Seller's knowledge, each Obligor has accepted the related Equipment and has
had reasonable opportunity to inspect and test such Equipment.
B-5
