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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) March 31, 1999
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Deutsche Recreational Asset Funding Corporation
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(Exact Name of Registrant as Specified in its Charter)
Nevada
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(State or Other Jurisdiction of Incorporation)
333-56303 91-1904587
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(Commission File Number) (I.R.S. Employer Identification No.)
655 Maryville Centre Drive, St. Louis, Missouri 63141
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(Address of Principal Executive Offices) (Zip Code)
(314) 523-3000
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events.
The Registrant is filing the exhibits listed in Item 7(c) below in
connection with the offering of Asset Backed Notes by Distribution Financial
Services RV Trust 1999-1.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit
No. Document Description
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1.1 Underwriting Agreement dated March 12, 1999 among Deutsche
Bank Securities Inc., Deutsche Recreational Asset Funding
Corporation and Deutsche Financial Services Corporation.
1.2 Terms Agreement dated March 12, 1999 among Deutsche Bank
Securities Inc., Deutsche Recreational Asset Funding
Corporation and Deutsche Financial Services Corporation.
4.1 Amended and Restated Trust Agreement dated as of March 1, 1999
between Deutsche Recreational Asset Funding Corporation and
Norwest Bank Minnesota, National Association, as Owner
Trustee.
4.3 Indenture dated as of March 1, 1999 between Distribution
Financial Services RV Trust 1999-1 and The Chase Manhattan
Bank, as Indenture Trustee.
10.1 Transfer and Servicing Agreement dated as of March 1, 1999
among Deutsche Recreational Asset Funding Corporation,
Distribution Financial Services RV Trust 1999-1 and Deutsche
Financial Services Corporation.
10.3 Ganis/Depositor Transfer Agreement dated as of March 1, 1999
between Ganis Credit Corporation and Deutsche Recreational
Asset Funding Corporation.
10.4 DFS/Ganis Transfer Agreement dated as of March 1, 1999 between
Deutsche Financial Services Corporation and Ganis Credit
Corporation.
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SIGNATURES
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.
DEUTSCHE RECREATIONAL ASSET
FUNDING CORPORATION
(Registrant)
Dated: March 31, 1999 By:/S/ Richard C. Goldman
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Name: Richard C. Goldman
Title: Vice President
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Exhibit 1.1
EXECUTION
DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION
DISTRIBUTION FINANCIAL SERVICES RV TRUSTS
Asset Backed Notes and Asset Backed Certificates
UNDERWRITING AGREEMENT
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March 12, 1999
DEUTSCHE BANK SECURITIES INC.
Acting on behalf of itself and, if applicable, as the Representative of the
several Underwriters named in Schedule 1 to the Terms Agreement (in either
such capacity sometimes herein the "Representative")
31 West 52nd Street
New York, New York 10019
Ladies and Gentlemen:
Section 1. Introductory. Deutsche Recreational Asset Funding
Corporation, a Nevada corporation (the "Depositor"), proposes to sell Asset
Backed Notes (the "Notes") and Asset Backed Certificates (the "Certificates" and
together with the Notes, the "Securities") from time to time in one or more
series (each, a "Series"). Each Series, which may include one or more classes of
Notes and/or one or more classes of Certificates, will be issued by a trust
formed with respect to such Series (each, a "Trust"). Each Trust will be formed
pursuant to a Trust Agreement (including any related Amended and Restated Trust
Agreement, each a "Trust Agreement") to be entered into between the Depositor
and the trustee specified therein (the "Owner Trustee"). Each Series of Notes
will be issued and secured pursuant to an Indenture (an "Indenture") between the
Trust and the indenture trustee specified therein (the "Indenture Trustee" and
together with the Owner Trustee, the "Trustees") and will represent indebtedness
of the related Trust. Each Certificate will represent a fractional undivided
interest in the related Trust. The assets of the Trust (the "Trust Property")
will include, among other things, a pool of retail installment sale contracts,
installment loans, or notes (the "Receivables") secured by new or used
recreational vehicles and/or recreational sport and power boats (including any
boat motors and accompanying trailers) and yachts (both power and sail), certain
monies due or received thereunder, security interests in the items financed
thereby and certain other property that shall have secured a Receivable and that
shall be obtained by the applicable Trust incidental to a foreclosure or
repossession in the event of a payment default.
The Securities are more fully described in the Registration Statement
(as defined herein). Each Series of Securities and any classes of Securities
(each, a "Class") within such Series may vary as to, among other things, number
and types of Classes, principal or notional amount,
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interest rate, the percentage interest, if any, evidenced by each Class in the
payments of principal of and interest on, or with respect to, the Trust
Property, priority of payment among Classes, credit enhancement with respect to
the related Trust Property or Securities, the Classes of such Series subject to
this Underwriting Agreement, and any other terms contemplated by the Terms
Agreement (as defined herein) with respect to the Securities of such Series.
Each offering of the Securities to which this Underwriting Agreement
applies will be made pursuant to the Registration Statement through the
Representative or through an underwriting syndicate managed by the
Representative. Whenever the Depositor determines to form a Trust and to make
such an offering of Securities of a Series, it will enter into an appropriate
agreement (the "Terms Agreement"), a form of which is attached hereto as Exhibit
A, providing for the sale of certain classes of such Securities to, and the
purchase and offering thereof by, the Representative and such other
underwriters, if any, as have authorized the Representative to enter into such
Terms Agreement on their behalf (the "Underwriters," which term shall include
the Representative, whether acting alone in the sale of such Securities, in
which case any reference herein to the Representative shall be deemed to refer
to the Representative in its individual capacity as Underwriter of the
Securities, or as a member of an underwriting syndicate). Such Terms Agreement
shall specify the undivided interest, principal or notional amount of each Class
of the Securities to be issued, the Classes of Securities subject to this
Underwriting Agreement, the price at which such Classes of Securities are to be
purchased by the Underwriters from the Depositor and the initial public offering
price or prices or the method by which the price or prices at which such
Securities are to be sold will be determined.
Each such offering of Securities as to which Deutsche Bank Securities
Inc. is the sole underwriter or acts as the Representative of the several
Underwriters will be governed by this Underwriting Agreement, as supplemented by
the applicable Terms Agreement, and this Underwriting Agreement and such Terms
Agreement shall inure to the benefit of and be binding upon each Underwriter
participating in the offering of such Securities. This Underwriting Agreement is
non-exclusive, and the Depositor may enter into any other underwriting agreement
with any other underwriter with respect to the offering and sale of Securities
of a Series.
Section 2. Representations, Warranties and Covenants of DFS and the
Depositor. Each of Deutsche Financial Services Corporation ("DFS") and the
Depositor, as applicable, represents and warrants to, and agrees with, each
Underwriter, as of the date of the related Terms Agreement, that:
(a) The registration statement specified in the related Terms
Agreement, on Form S-3, including a prospectus, has been filed with the
Securities and Exchange Commission (the "Commission") for the registration under
the Securities Act of 1933, as amended (the "Act"), of the Securities, which
registration statement has been declared effective by the Commission. Such
registration statement, as amended to the date of the related Terms Agreement,
including any documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the Act which were filed under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), on or before the effective date of the
Registration Statement (as such date is defined in Rule 158(c) under the Act,
the "Effective Date"), is hereinafter called the "Registration Statement," and
such prospectus, as such prospectus is supplemented by a prospectus supplement
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relating to the Securities of the related Series, each in the form first filed
after the date of the related Terms Agreement pursuant to Rule 424(b) under the
Act, including any documents incorporated by reference therein pursuant to Item
12 of Form S-3 under the Act which were filed under the Exchange Act on or
before the date of such prospectus supplement (such prospectus supplement,
including such incorporated documents, in the form first filed after the date of
the related Terms Agreement pursuant to Rule 424(b) is hereinafter called the
"Prospectus Supplement"), is hereinafter called the "Prospectus" (except where
the context requires otherwise). Any reference herein to the terms "amend,"
"amendment" or "supplement" with respect to the Registration Statement, the
Prospectus or the Prospectus Supplement shall be deemed to refer to and include
the filing of any document under the Exchange Act after the Effective Date or
the issue date of the Prospectus or Prospectus Supplement, as the case may be,
deemed to be incorporated therein by reference pursuant to Item 12 of Form S-3
under the Act.
(b) The related Registration Statement, at the time it became
effective, and the prospectus contained therein, and any amendments thereof and
supplements thereto filed prior to the date of the related Terms Agreement,
conformed in all material respects to the requirements of the Act and the rules
and regulations of the Commission thereunder (the "Rules and Regulations"); on
the date of the related Terms Agreement and on the related Closing Date, the
Registration Statement, the Prospectus and the related Prospectus Supplement,
and any amendments thereof and supplements thereto, will conform in all material
respects to the requirements of the Act and the Rules and Regulations; such
Registration Statement, at the time it became effective, did not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading;
such Prospectus and Prospectus Supplement, on the date of any filing pursuant to
Rule 424(b) and on the related Closing Date, will not include any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they are
made, not misleading; provided, however, that neither DFS nor the Depositor
makes any representations or warranties as to the information contained in or
omitted from (A) such Registration Statement or such Prospectus (or any
supplement thereto) in reliance upon and in conformity with written information
furnished to the Depositor by or on behalf of the Underwriters specifically for
use in the preparation thereof as specified in the related Terms Agreement or
(B) any ABS Filing (as defined herein), or in any amendment thereof or
supplement thereto, incorporated by reference in such Registration Statement or
such Prospectus (or any amendment thereof or supplement thereto).
(c) Each of DFS and the Depositor is a corporation duly incorporated,
validly existing and in good standing under the laws of the state of its
incorporation, and is duly qualified to transact business and is in good
standing in each jurisdiction in the United States of America in which the
conduct of its business or the ownership of its property requires such
qualification, with corporate power to own, lease and operate its property and
conduct its business as it is currently conducted.
(d) Each of DFS and the Depositor has, and will have, the requisite
power to execute and deliver each this Underwriting Agreement and each Trust
Agreement, Indenture, transfer and servicing agreement, transfer agreement or
other document executed by either of them in connection with the issuance and
sale of the related Securities (each, an "Agreement") (as
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applicable) and Terms Agreement and to perform their respective obligations
hereunder and thereunder.
(e) Each of the Agreements (as applicable), Terms Agreements and this
Underwriting Agreement has been, or will be, duly and validly authorized,
executed and delivered by each of DFS and the Depositor, and each of the
Agreements (as applicable), Terms Agreements and this Underwriting Agreement
constitutes, or will constitute, the valid, legal and binding obligation of each
of DFS and the Depositor, enforceable against each of DFS and the Depositor in
accordance with its terms.
(f) The Securities of each Series conform, or will conform as of the
related Closing Date, to the description thereof contained in the Registration
Statement, the Prospectus, and the related Prospectus Supplement; and the
Securities of such Series, on the related Closing Date, will have been duly and
validly authorized and, when such Securities are duly and validly executed,
issued and delivered in accordance with the related Agreement, and sold to the
Underwriters as provided herein and in the related Terms Agreement, will each be
validly issued and outstanding and entitled to the benefits of such Agreement.
(g) Neither the execution and delivery by DFS or the Depositor of any
Agreement (as applicable), Terms Agreement or this Underwriting Agreement nor
the consummation by DFS or the Depositor of the transactions contemplated herein
or therein, nor the issuance of the Securities of a Series by a Trust or the
public offering thereof as contemplated in the Prospectus and the applicable
Prospectus Supplement, will conflict in any material respect with or result in a
material breach of, or constitute a material default (with notice or passage of
time or both) under, or result in the imposition of any lien, pledge, charge,
encumbrance, adverse claim or other security interest of any other person
(collectively, "Liens") upon any of the property or assets of DFS or the
Depositor (except as required or permitted pursuant thereto or hereto), pursuant
to any material mortgage, indenture, loan agreement, contract or other
instrument to which DFS or the Depositor is party or by which either of them is
bound, nor will such action result in any violation of any provisions of any
applicable law, administrative regulation or administrative or court decree, the
certificate of incorporation or by-laws of DFS or the Depositor. Neither DFS nor
the Depositor is in violation of its certificate of incorporation, in default in
any material respect in the performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease, trust agreement, transfer and
servicing agreement or other instrument to which it is a party or by which it
may be bound, or to which any material portion of its property or assets is
subject.
(h) No legal or governmental proceedings are pending to which DFS or
the Depositor is a party or of which any property of DFS or the Depositor is the
subject, which if determined adversely to DFS or the Depositor would,
individually or in the aggregate, have a material adverse effect on the
financial position, shareholders' equity or results of operations of DFS or the
Depositor; and to the best of DFS's or the Depositor's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others.
(i) No consent, approval, authorization or order of, or registration,
filing or declaration with, any court or governmental agency or body is
required, or will be required, in connection with (i) the execution and delivery
by DFS or the Depositor of any Agreement (as
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applicable), Terms Agreement or this Underwriting Agreement or the performance
by DFS or the Depositor of any Agreement (as applicable), Terms Agreement or
this Underwriting Agreement or (ii) the offer, sale or delivery of the
Securities of any Series, except such as shall have been obtained or made, as
the case may be, or will be obtained or made, as the case may be, prior to the
applicable Closing Date, or will not materially adversely affect the ability of
DFS or the Depositor to perform its obligations under any Agreement (as
applicable), Terms Agreement or this Underwriting Agreement.
(j) Each of DFS and the Depositor possesses, and will possess, all
material licenses, certificates, authorities or permits issued by the
appropriate state, federal or foreign regulatory agencies or bodies necessary to
conduct the business now conducted by it and as described in the Prospectus and
Prospectus Supplement, except to the extent that the failure to have such
licenses, certificates, authorities or permits does not have a material adverse
effect on the Securities of any Series or the financial condition of DFS or the
Depositor, and neither DFS nor the Depositor has received, nor will have
received as of each Closing Date, any notice of proceedings relating to the
revocation or modification of any such license, certificate, authority or permit
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would materially and adversely affect the conduct of its
business, operations or financial condition.
(k) On the related Closing Date, (i) the Depositor will have good and
marketable title to the related Receivables being transferred by it to the Trust
pursuant thereto, free and clear of any Lien, except to the extent permitted in
the applicable Agreement, (ii) the Depositor will not have assigned to any
person any of its right, title or interest in such Receivables or in the
applicable Agreement, (iii) the Depositor will have the power and authority to
sell such Receivables to the Trust, and upon execution and delivery of the
applicable Agreement by the Owner Trustee, the Trust will have good and
marketable title thereto, in each case free of Liens other than any Lien created
by an Underwriter, and (iv) if applicable, the related Trust shall have the
power and authority to assign such Receivables to the related Indenture Trustee,
and, upon execution and delivery of the related Indenture, such Indenture
Trustee will have all the interest in such Receivables conveyed thereby, free of
Liens other than any Lien created by an Underwriter.
(l) The properties and businesses of each of DFS and the Depositor
conform, and will conform, in all material respects, to the descriptions thereof
contained in the Prospectus and the Prospectus Supplements.
(m) Since the date as of which information is given in the Registration
Statement, there has not been any material adverse change in the business or net
worth of the Depositor, the Transferor or DFS.
Section 3. Purchase, Sale and Delivery of Securities. (a) On the basis
of the representations, warranties and agreements contained in this Underwriting
Agreement and in the Terms Agreement for a particular offering of Securities,
but subject to the terms and conditions set forth in this Underwriting Agreement
and subject to the execution of such Terms Agreement, the Depositor agrees to
sell to each Underwriter, severally and not jointly, and each Underwriter,
severally and not jointly, agrees to purchase from the Depositor, the respective
original principal amounts of the related Securities set forth in the related
Terms Agreement opposite the name of
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such Underwriter, plus any additional original principal amount of Securities
which such Underwriter may be obligated to purchase pursuant to Section 12
hereof, at the purchase price therefor set forth in such Terms Agreement.
The parties hereto agree that settlement for all securities sold
pursuant to this Underwriting Agreement shall take place on the terms set forth
herein and not as set forth in Rule 15c6-1(a) under the Exchange Act.
(b) Against payment of the purchase price specified in the applicable
Terms Agreement in same day funds drawn to the order of the Depositor (or paid
by such other manner as may be agreed upon by the Depositor and the
Representative), the Depositor will deliver the related Securities of a Series
to the Underwriters at the offices of Mayer, Brown & Platt, 190 South LaSalle
Street, Chicago, Illinois 60603 at such time as shall be specified in such Terms
Agreement, or at such other place and time as the Representative and the
Depositor shall agree upon, each such time being herein referred to as a
"Closing Date." The Securities of each Series will initially be in definitive,
fully registered form or will be maintained through the facilities of The
Depository Trust Company, as indicated in the applicable Prospectus Supplement.
Section 4. Public Offering of Securities. It is understood by the
parties hereto that, after the Registration Statement becomes effective, the
Underwriters propose to offer the Securities for sale to the public (which may
include selected dealers), as set forth in the Prospectus.
Section 5. Covenants of DFS and the Depositor. Each of DFS and the
Depositor jointly and severally covenants and agrees with each Underwriter:
(a) That immediately following the execution of each Terms Agreement,
the Depositor shall prepare a Prospectus Supplement setting forth the amount of
Securities covered thereby and the terms thereof not otherwise specified in the
Prospectus, the price at which such Securities are to be purchased by the
Underwriters from the Depositor, either the initial public offering price or the
method by which the price at which such Securities are to be sold will be
determined, the selling concessions and reallowances, if any, and such other
information as the Representative and the Depositor deem appropriate in
connection with the offering of such Securities; provided, however, that each of
DFS and the Depositor shall make no amendment or supplement to the Registration
Statement affecting or relating to any material extent to the Securities of a
Series to which this Underwriting Agreement relates, and shall make no amendment
or supplement to the Prospectus or the Prospectus Supplement without furnishing
the Representative with a copy of the proposed form thereof and providing the
Representative with a reasonable opportunity to review the same, and shall not
file any such amendment or supplement to which the Representative shall
reasonably object; and, provided further, that each of DFS and the Depositor
shall advise the Representative, promptly after it receives notice thereof, of
the time when any amendment to the Registration Statement has been filed or
becomes effective or any supplement to the Prospectus or the Prospectus
Supplement or any amended Prospectus or Prospectus Supplement has been filed or
mailed for filing, of the issuance of any stop order by the Commission, of the
suspension of the qualification of the Securities of a Series for offering or
sale in any jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement, the Prospectus or the Prospectus
Supplement or for additional information; and, in the
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event of the issuance of any such stop order or of any order preventing or
suspending the use of any Prospectus or Prospectus Supplement relating to the
Securities of a Series or suspending any such qualification, promptly shall use
its best efforts to obtain its withdrawal.
(b) That the Depositor shall cause any Computational Materials and any
Structural Term Sheets (each as defined herein) with respect to the Securities
of a Series that are delivered by an Underwriter to the Depositor pursuant to
Section 9 to be filed with the Commission on a Current Report on Form 8-K (an
"ABS Filing") pursuant to Rule 13a-11 under the Exchange Act on the business day
immediately following the later of (i) the day on which such Computational
Materials and Structural Term Sheets are delivered to counsel for the Depositor
by an Underwriter prior to 1:00 p.m. New York time and (ii) the date on which
the related Prospectus Supplement is first made available to the public. The
Depositor shall cause any Collateral Term Sheet with respect to the Securities
of a Series that is delivered by the Representative to the Depositor in
accordance with the provisions of Section 10 to be filed with the Commission on
an ABS Filing pursuant to Rule 13a-11 under the Exchange Act on the business day
immediately following the day on which such Collateral Term Sheet is delivered
to counsel for the Depositor by the Representative. Each such ABS Filing shall
be incorporated by reference in the related Prospectus and the related
Registration Statement.
(c) Promptly from time to time to take such action as the
Representative may reasonably request in order to qualify the Securities of a
Series for offering and sale under the securities laws of such states as the
Representative may request and to continue such qualifications in effect so long
as necessary under such laws for the distribution of such Securities; provided,
that in connection therewith neither DFS nor the Depositor shall be required to
qualify as a foreign corporation to do business or to file a general consent to
service of process in any jurisdiction.
(d) To furnish to each Underwriter copies of the Registration Statement
(one of which will be signed and will include all exhibits), each related
preliminary prospectus, the Prospectus, and all amendments and supplements to
such documents, in each case as soon as available and in such quantities as such
Underwriter may from time to time reasonably request; and, if the delivery of a
Prospectus or Prospectus Supplement shall be at the time required by law in
connection with sales of the Securities of a Series and either (i) any event
shall have occurred as a result of which the Prospectus or Prospectus Supplement
would include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, or (ii) for any
other reason it shall be necessary during such same period to amend or
supplement the Prospectus or Prospectus Supplement, to notify the Representative
and to prepare and furnish to the Representative as the Representative may from
time to time reasonably request an amendment or a supplement to the Prospectus
or Prospectus Supplement which will correct such statement or omission or effect
such compliance, or if it is necessary at any time to amend or supplement the
Prospectus or Prospectus Supplement to comply with the Act or the Rules and
Regulations, the Depositor will promptly prepare and file with the Commission an
amendment or supplement that will correct such statement or omission or an
amendment that will effect such compliance; provided, however, that the
Depositor will not be required to file any such amendment or supplement with
respect to any Computational Materials, Structural Term Sheets or Collateral
Term Sheets incorporated by reference in the Prospectus other than any
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amendments or supplements of such Computational Materials or Structural Term
Sheets that are furnished to the Depositor by the Underwriters pursuant to
Section 9(c) hereof or any amendments or supplements of such Collateral Term
Sheets that are furnished to the Depositor by the Underwriters pursuant to
Section 10(c) hereof which are required to be filed in accordance therewith.
(e) To file or cause to be filed with the Commission all reports
required to be filed with respect to each Series pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act.
(f) So long as any of the Securities of a Series are outstanding, to
furnish each Underwriter copies of all reports or other communications
(financial or other) furnished to holders of such Securities, and to deliver to
the Underwriters during such same period (i) as soon as they are available,
copies of any reports and financial statements furnished to or filed with the
Commission and (ii) such additional information concerning the business and
financial condition of the Depositor as such Underwriter may from time to time
reasonably request.
(g) To pay all expenses (other than fees of counsel for the
Underwriters, except as provided below) incident to the performance of the
obligations under this Underwriting Agreement and the related Terms Agreement,
including:
(i) the word processing, printing and filing of the
Registration Statement as originally filed and of each amendment
thereto;
(ii) the reproduction of this Underwriting Agreement and the
related Terms Agreement;
(iii) the preparation, printing, issuance and delivery of the
Securities of each Series to the Underwriters;
(iv) the fees and disbursements of counsel and accountants
for DFS and/or the Depositor;
(v) the qualification of the Securities of a Series under
securities laws in accordance with the provisions of Section 5(c)
hereof, including filing fees and the reasonable fees and disbursements
of counsel for the Underwriters in connection therewith and in
connection with the preparation of the Blue Sky Survey;
(vi) if requested by the Representative, the determination of
the eligibility of the Securities for investment and the reasonable
fees and disbursements of counsel for the Underwriters in connection
therewith and in connection with the preparation of the Legal
Investment Memorandum;
(vii) the printing and delivery to the Underwriters of copies
of the Registration Statement as originally filed and of each amendment
thereto, of the preliminary prospectuses, and of the Prospectus and
Prospectus Supplement and any amendments or supplements thereto;
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(viii) the printing and delivery to the Underwriters of copies
of the Blue Sky Survey and, if requested by the Representative, the
Legal Investment Memorandum, if any;
(ix) the fees of any rating agency rating the Securities of a
Series; and
(x) the fees and expenses of each Trustee and its counsel.
If the sale of the Securities of a Series is not consummated by reason
of any failure, refusal or inability on the part of DFS or the Depositor to
perform any agreement on its part to be performed, or because any condition of
the Underwriters' obligations hereunder required to be fulfilled shall not have
been fulfilled (other than as a result of any breach or default by the
Underwriters), each of DFS and the Depositor shall jointly and severally be
obligated to reimburse the Underwriters for all out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for the Underwriters.
For purposes of the preceding sentence, the conditions in clauses (ii) and (iii)
of Section 6(d) shall not be conditions required to be fulfilled by DFS or the
Depositor.
(h) So long as the Securities of a Series are outstanding, or until
such time as each Underwriter shall cease to maintain a secondary market in such
Securities, whichever occurs first, to deliver to each Underwriter all
statements and reports furnished to the related Trustee pursuant the applicable
Agreement, as soon as such statements and reports are furnished to such Trustee.
(i) From and after the related Closing Date, not to take any action
inconsistent with the related Trust's ownership of the related Receivables other
than as permitted by the applicable Agreement.
(j) To the extent, if any, that the rating provided with respect to any
Class of Securities of a Series by a rating agency or agencies that initially
rate such Securities is conditional upon the furnishing of documents or the
taking of any other actions by DFS and/or the Depositor, to furnish such
documents and take any such other actions.
(k) That during the period when a prospectus is required by law to be
delivered in connection with the sale of the Securities of a Series pursuant to
this Underwriting Agreement and the related Terms Agreement, the Depositor will
file, or cause the related Trustee to file on behalf of the related Trust, on a
timely and complete basis, all documents that are required to be filed by such
Trust with the Commission pursuant to Sections 13, 14 or 15(d) of the Exchange
Act.
Section 6. Conditions Precedent to the Obligations of the Underwriters.
The obligation of the Underwriters to purchase and pay for the Securities of a
Series is subject to the accuracy of the representations and warranties on the
part of DFS and the Depositor herein and in the related Terms Agreement as of
the respective dates thereof and the related Closing Date, to the accuracy of
the statements of officers of DFS and the Depositor made pursuant to the
provisions hereof and thereof, to the performance by each of DFS and the
Depositor of its obligations hereunder and thereunder and to the following
additional conditions precedent:
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(a) The Registration Statement shall have become effective not later
than 4:00 p.m., New York time, on the day following the date of this
Underwriting Agreement or such later date as shall have been consented to by the
Representative; and prior to the related Closing Date no stop order suspending
the effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the knowledge of
DFS or the Depositor, shall be contemplated by the Commission. If the Depositor
has elected to rely upon Rule 430A of the Rules and Regulations, the price of
the Securities of a Series and any price-related information previously omitted
from the effective Registration Statement pursuant to such Rule 430A shall have
been transmitted to the Commission for filing pursuant to Rule 424(b) of the
Rules and Regulations within the prescribed time period, and prior to the
related Closing Date the Depositor shall have provided evidence satisfactory to
the Representative of such timely filing, or a post-effective amendment
providing such information shall have been promptly filed and declared effective
in accordance with the requirements of Rule 430A of the Rules and Regulations.
(b) Each of DFS and the Depositor shall have delivered on or before the
related Closing Date to the Representative a certificate, dated as of such
Closing Date, signed by its president, a senior vice president or a vice
president to the effect that the signer of such certificate has carefully
examined the Registration Statement, the Prospectus, each related Agreement and
this Underwriting Agreement and related Terms Agreement and that:
(i) to the best of such officer's knowledge, the representations
and warranties of DFS and/or the Depositor, as the case may be, in this
Underwriting Agreement and the related Terms Agreement are true and
correct in all material respects at and as of such Closing Date with
the same effect as if made on such Closing Date;
(ii) each of DFS and the Depositor, as the case may be, has
complied with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to such Closing Date;
(iii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been initiated or, to DFS's or the Depositor's knowledge,
threatened as of such Closing Date; and
(iv) nothing has come to such person's attention that would lead
such person to believe that the Prospectus as amended and supplemented
as of such Closing Date contains any untrue statement of a material
fact or omits to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading.
(c) Since the respective dates as of which information is given in the
Prospectus and Prospectus Supplement, there shall not have occurred any material
adverse change or any development involving a prospective material adverse
change in or affecting particularly the business or assets of the related Trust,
the Depositor or DFS or any material adverse change in the financial position or
results or operations of such Trust, the Depositor or DFS otherwise than as set
forth or contemplated in the Prospectus and Prospectus Supplement, which in any
such case makes it impracticable or inadvisable in the Representative's judgment
to proceed with the
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<PAGE>
public offering or the delivery of the related Securities on the terms and in
the manner contemplated in the related Terms Agreement and Prospectus and
Prospectus Supplement.
(d) Subsequent to the execution and delivery of a Terms Agreement,
there shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting particularly the business, financial
condition or properties of DFS or the Depositor which, in the Representative's
judgment, materially impairs the investment quality of the related Securities,
(ii) any material adverse change in the financial markets in the United States
or any outbreak of hostilities or other calamity or crisis, the effect of which
is such as to make it, in the judgment of the Representative, impracticable or
inadvisable to market such Securities or to enforce contracts for the sale of
such Securities, (iii) the suspension of trading generally by either the
American Stock Exchange or the New York Stock Exchange, or the establishment of
minimum or maximum prices or ranges of prices, by either of such exchanges or by
order of the Commission or any other governmental authority, or any banking
moratorium declared by Federal, Missouri or New York authorities or (iv) any
event that would constitute a default under such Terms Agreement or this
Underwriting Agreement or default in the performance of DFS's or the Depositor's
obligations under any related Agreement or which, with the passage of time or
the giving of notice or both, would constitute such default.
(e) The Representative shall have received from counsel (who shall be
satisfactory to the Representative) for DFS and the Depositor, an opinion, dated
the related Closing Date, addressed to the Underwriters and satisfactory in form
and substance to the Representative and to counsel to the Underwriters, with
respect to the matters set forth in Exhibit B hereto.
(f) The Representative shall have received from counsel (who shall be
satisfactory to the Representative) for the Depositor, an opinion, dated the
related Closing Date and satisfactory in form and substance to the
Representative and to counsel to the Underwriters, to the effect that the
information in the Prospectus and Prospectus Supplement under the heading "State
and Local Tax Consequences," to the extent it constitutes matters of Missouri,
Illinois, California or New York law or legal conclusions with respect thereto,
has been reviewed by such counsel and is correct in all material respects.
(g) The Representative shall have received from counsel (who shall be
satisfactory to the Representative) for DFS and the Depositor, an opinion, dated
the related Closing Date, addressed to the Underwriters and satisfactory in form
and substance to the Representative and to counsel to the Underwriters, relating
to certain insolvency and bankruptcy matters and federal income tax matters.
(h) The Representative shall have received from counsel (who shall be
satisfactory to the Representative) for each Trustee, an opinion, dated the
related Closing Date, addressed to the Underwriters, DFS and the Depositor and
satisfactory in form and substance to the Representative and to counsel to the
Underwriters, in substantially the form of Exhibit C hereto.
(i) The Representative shall have received an officer's certificate
dated the related Closing Date of the chairman of the board, the president, an
executive vice president or the treasurer of each Trustee in which such officer
shall state that, to the best of his/her knowledge after reasonable
investigation, the representations and warranties of such Trustee contained in
the
11
<PAGE>
related Agreement are true and correct in all material respects, and that such
Trustee has complied in all material respects with all agreements and satisfied
all conditions on its part to be performed or satisfied under the related
Agreement at or prior to such Closing Date.
(j) Each Trustee shall have furnished to the Representative a
certificate of the Trustee, signed by one or more duly authorized officers of
such Trustee, dated the related Closing Date, as to the due acceptance of the
related Agreement by such Trustee and the due execution and delivery of the
Securities of such Series by such Trustee thereunder and such other matters as
the Representative shall reasonably request.
(k) Counsel to DFS and the Depositor shall have furnished to the
Representative any opinions supplied to the rating agencies relating to certain
matters with respect to the Securities of a Series, which opinions shall also be
addressed to the Underwriters. Drafts of such opinions shall have been furnished
to the Representative no later than five business days prior to the related
Closing Date.
(l) The Representative shall have received a letter, dated the related
Closing Date and addressed to the Underwriters, from certified public
accountants (who shall be satisfactory to the Representative), substantially in
the form approved by the Representative and counsel to the Underwriters.
(m) The Representative shall have received a copy of (i) a file-stamped
acknowledgment copy of each UCC-1 financing statement on Form UCC-1
appropriately filed with respect to the transfer of the related Receivables by
DFS to the Depositor, identifying such Receivables as collateral and naming DFS
as debtor and the Depositor as the secured party, (ii) a file-stamped
acknowledgment copy of each UCC-1 financing statement on Form UCC-1
appropriately filed with respect to the transfer of the related Receivables by
the Depositor to the Owner Trustee pursuant to the related Agreement,
identifying such Receivables as collateral and naming the Depositor as debtor
and the Trust as the secured party, and (iii) if applicable, a file-stamped
acknowledgment copy of each UCC-1 financing statement on Form UCC-1
appropriately filed with respect to the grant of the related Receivables by the
Trust to the Indenture Trustee pursuant to the related Indenture, identifying
such Receivables as collateral and naming the Trust as debtor and the Indenture
Trustee as the secured party.
(n) All documents incident to the Agreements, Terms Agreements and this
Underwriting Agreement shall be reasonably satisfactory in form and substance to
the Representative and counsel to the Underwriters; and all actions taken by the
Depositor to authorize the offering and sale of the Securities of a Series shall
be reasonably satisfactory in form and substance to the Representative and
counsel to the Underwriters; and DFS and/or the Depositor shall furnish the
Representative and counsel to the Underwriters with such other opinions,
certificates, letters and documents as the Representative or counsel to the
Underwriters shall reasonably request.
(o) The Securities of the related Series shall have received the
ratings specified in the related Terms Agreement.
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<PAGE>
(p) On or prior to the related Closing Date, there has been no
downgrading, nor has any notice been given of (i) any intended or possible
downgrading or (ii) any review or possible changes in rating the direction of
which has not been indicated, in the rating accorded and originally requested by
and paid for by or on behalf of the Depositor relating to any previously issued
asset-backed securities of any Trust by any "nationally recognized statistical
rating organization" (as such terms is defined for purposes of the Exchange
Act).
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Underwriting Agreement
(with respect to the related Securities) and the related Terms Agreement may be
terminated by the Representative by notice to the Depositor at any time at or
prior to the related Closing Date, and such termination shall be without
liability of any party to any other party except as provided in Section 5
hereof.
Section 7. Indemnification and Contribution. (a) Each of DFS and the
Depositor shall, jointly and severally, indemnify and hold harmless each
Underwriter and each person who controls any Underwriter within the meaning of
Section 15 of the Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, if such
settlement is effected with the written consent of the Depositor and
DFS (which consent shall not be unreasonably withheld); and
(iii) against any and all expense whatsoever (including, subject to
Section 7(c) hereof, the reasonable fees and disbursements of counsel
chosen by the Representative) incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, to the
extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this Section 7 shall not apply to any loss, liability,
claim, damage or expense to the extent arising out of any untrue statement or
omission or alleged untrue statement or omission made (A) in reliance upon and
in conformity with written information furnished to the Depositor by the
Representative expressly for use in the Registration Statement (or any amendment
thereto) or any preliminary prospectus or the Prospectus (or any amendment or
13
<PAGE>
supplement thereto) and set forth in the Prospectus and in the Prospectus
Supplement, in each case as specified in the related Terms Agreement, or (B) in
any ABS Filing or any amendment or supplement thereof, except to the extent that
any untrue statement or alleged untrue statement therein or omission therefrom
results (or is alleged to have resulted) from an error (a "Pool Error") in the
information concerning the characteristics of the Receivables furnished by the
Depositor to the Underwriter in writing or by electronic transmission that was
used in the preparation of any Computational Materials or ABS Term Sheets (or
amendments or supplements thereof) included in such ABS Filing (or amendment or
supplement thereof).
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Depositor and DFS, each of their respective directors, each of their
respective officers who signed the Registration Statement, and each person, if
any, who controls the Depositor and DFS, respectively, within the meaning of
Section 15 of the Act, against any and all loss, liability, claim, damage and
expense described in the indemnity contained in subsection (a) of this Section
7, as incurred, but only with respect to (i) untrue statements or omissions, or
alleged untrue statements or omissions, made in the Registration Statement (or
any amendment thereto), or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Depositor through the Representative expressly for
use in the Registration Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), in each
case as specified in the related Terms Agreement, or (ii) any Computational
Materials or ABS Term Sheets (or amendments or supplements thereof) furnished to
the Depositor by such Underwriter through the Representative pursuant to Section
9 or Section 10, or directly by such Underwriter, to the extent that such
materials were delivered to investors by such Underwriter, and incorporated by
reference in such Registration Statement or the related Prospectus or any
amendment or supplement thereof (except that no such indemnity shall be
available for any losses, claims, damages or liabilities, or actions in respect
thereof, resulting from any Pool Error).
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it with
respect to which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve it from any liability which it may have
otherwise than on account of this Section 7. An indemnifying party may
participate at its own expense in the defense of any such action. In no event
shall the indemnifying parties be liable for the fees and expenses of more than
one counsel (in addition to any local counsel) separate from their own counsel
for all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances.
Section 8. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 7 is for any reason held to be unenforceable by the indemnified parties
although applicable in accordance with its terms, the Depositor and DFS, jointly
and severally, on the one hand, and the Underwriters (as applicable), on the
other, shall contribute to the aggregate losses, liabilities, claims, damages
and expenses of the nature contemplated by said Section 7 incurred by the
Depositor, DFS and one or more Underwriters, as incurred, in such proportions
that each applicable Underwriter is responsible for that portion represented by
the percentage that the underwriting discount received
14
<PAGE>
by it bears to the initial public offering price of the related Series of
Securities, and the Depositor and DFS shall be jointly and severally responsible
for the balance; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. Notwithstanding the other provisions of this Section 8, an
Underwriter shall not be required to contribute any amount in excess of the
amount by which the total price at which such Securities were offered to the
public exceeds the amount of any damages which such Underwriter has otherwise
been required to pay in respect of such losses, liabilities, claims, damages and
expenses. For purposes of this Section 8, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the Act shall have the same
rights to contribution as such Underwriter and each officer of the Depositor or
DFS who signed the Registration Statement, and each person, if any, who controls
the Depositor or DFS within the meaning of Section 15 of the Act shall have the
same rights to contribution as the Depositor and DFS.
Section 9. Computational Materials and Structural Term Sheets. (a) Not
later than 5 p.m., New York time, on the business day before the date on which
the applicable ABS Filing relating to the Securities of a Series is required to
be filed by the Depositor with the Commission pursuant to Section 5(b) hereof,
the Representative shall deliver to the Depositor a complete copy of all
materials provided by the Underwriters to prospective investors in such
Securities that constitute (i) "Computational Materials" within the meaning of
the no-action letter dated May 20, 1994, issued by the Division of Corporation
Finance of the Commission to Kidder, Peabody Acceptance Corporation I, Kidder,
Peabody & Co. Incorporated and Kidder Structured Asset Corporation and the
no-action letter dated May 27, 1994, issued by the Division of Corporation
Finance of the Commission to the Public Securities Association (together, the
"Kidder Letters"), the filing of which material is a condition of the relief
granted in such letters (such materials being the "Computational Materials") and
(ii) "Structural Term Sheets" within the meaning of the no-action letter dated
February 17, 1995, issued by the Division of Corporation Finance of the
Commission to the Public Securities Association (the "PSA Letter"), the filing
of which material is a condition of the relief granted in such letter (such
materials being the "Structural Term Sheets"); prior to such delivery by the
Representative to the Depositor of such materials, the Representative shall
notify, or cause to be notified, the Depositor or its counsel by telephone of
its intention to deliver such materials and the approximate date on which such
delivery of such materials is expected to occur.
(b) Each Underwriter represents and warrants to and agrees with the
Depositor, as of the date of the related Terms Agreement and as of the related
Closing Date, that:
(i) the Computational Materials furnished to the Depositor
pursuant to Section 9(a) constitute (either in original, aggregated or
consolidated form) all of the materials furnished to prospective
investors by such Underwriter prior to the time of delivery thereof to
the Depositor that are required to be filed with the Commission with
respect to the related Securities in accordance with the Kidder
Letters, and such Computational Materials comply with the requirements
of the Kidder Letters; and
(ii) the Structural Term Sheets furnished to the Depositor
pursuant to Section 9(a) constitute all of the materials furnished to
prospective investors by the Underwriter
15
<PAGE>
prior to the time of delivery thereof to the Depositor that are
required to be filed with the Commission as "Structural Term Sheets"
with respect to the related Securities in accordance with the PSA
Letter, and such Structural Term Sheets comply with the requirements of
the PSA Letter.
(c) If, at any time when a prospectus relating to the Securities of a
Series is required to be delivered under the Act, it shall be necessary to amend
or supplement the related Prospectus and Prospectus Supplement as a result of an
untrue statement of a material fact contained in any Computational Materials or
Structural Term Sheets provided by the Underwriters pursuant to this Section 9
or the omission to state therein a material fact required, when considered in
conjunction with the related Prospectus and Prospectus Supplement, to be stated
therein or necessary to make the statements therein, when read in conjunction
with the related Prospectus and Prospectus Supplement, not misleading, or if it
shall be necessary to amend or supplement any ABS Filing relating to any
Computational Materials or Structural Term Sheets to comply with the Act or the
Rules and Regulations, the Representative promptly will prepare and furnish to
the Depositor for filing with the Commission an amendment or supplement that
will correct such statement or omission or an amendment which will effect such
compliance.
Section 10. Collateral Term Sheets. (a) Prior to the delivery of any
"Collateral Term Sheet" within the meaning of the PSA Letter, the filing of
which material is a condition of the relief granted in such letter (such
material being the "Collateral Term Sheets" and together with Structural Term
Sheets, referred to herein as "ABS Term Sheets"), to a prospective investor in
Securities of a Series, the Representative shall, in order to facilitate the
timely filing of such material with the Commission, notify the Depositor and its
counsel by telephone of its intention to deliver such materials and the
approximate date on which the first such delivery of such materials is expected
to occur. Not later than 2 p.m., New York time, on the business day immediately
following the date on which any Collateral Term Sheet was first delivered to a
prospective investor in such Securities, the Representative shall deliver to the
Depositor a complete copy of all materials provided by the Underwriters to
prospective investors in the Securities that constitute "Collateral Term
Sheets." At the time of each such delivery, the Representative shall indicate in
writing that the materials being delivered constitute Collateral Term Sheets.
(b) Each Underwriter represents and warrants to and agrees with the
Depositor as of the date of the related Terms Agreement and as of the related
Closing Date, that the Collateral Term Sheets furnished to the Depositor
pursuant to Section 10(a) constitute all of the materials furnished to
prospective investors by such Underwriter prior to time of delivery thereof to
the Depositor that are required to be filed with the Commission as "Collateral
Term Sheets" with respect to the related Securities in accordance with the PSA
Letter, and such Collateral Term Sheets comply with the requirements of the PSA
Letter.
(c) If, at any time when a prospectus relating to the Securities of a
Series is required to be delivered under the Act, it shall be necessary to amend
or supplement the related Prospectus and Prospectus Supplement as a result of an
untrue statement of a material fact contained in any Collateral Term Sheets
provided by the Underwriters pursuant to this Section 10 or the omission to
state therein a material fact required, when considered in conjunction with
16
<PAGE>
the related Prospectus and Prospectus Supplement, to be stated therein or
necessary to make the statements therein, when read in conjunction with the
related Prospectus and Prospectus Supplement, not misleading, or if it shall be
necessary to amend or supplement any ABS Filing relating to any Collateral Term
Sheets to comply with the Act or the Rules and Regulations, the Representative
promptly will prepare and furnish to the Depositor for filing with the
Commission an amendment or supplement that will correct such statement or
omission or an amendment which will effect such compliance.
Section 11. Survival of Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of
each of DFS, the Depositor or its officers and of the Underwriters set forth in
or made pursuant to this Underwriting Agreement and the related Terms Agreement
will remain in full force and effect, regardless of any investigation or
statement as to the results thereof, made by or on behalf of any Underwriter,
DFS, the Depositor or any of their respective representatives, officers or
directors of any controlling person, and will survive delivery of and payment
for the related Securities.
Section 12. Default by One or More of the Underwriters. If one or more
of the Underwriters shall fail on a Closing Date to purchase the related
Securities which it or they are obligated to purchase under this Underwriting
Agreement and the applicable Terms Agreement (the "Defaulted Securities"), the
Representative shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth and under the applicable Terms Agreement; if, however, the Representative
shall not have completed such arrangements within such 24-hour period, then:
(a) if the principal amount of Defaulted Securities does not exceed 10%
of the principal amount of such Series of Securities to be purchased pursuant to
such Terms Agreement, each of the non-defaulting Underwriters named in such
Terms Agreement shall be obligated, severally and not jointly, to purchase the
full amount thereof in the proportions that their respective underwriting
obligations thereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the principal amount of Defaulted Securities exceeds 10% of the
principal amount of such Series of Securities to be purchased pursuant to such
Terms Agreement, the applicable Terms Agreement shall terminate without
liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section 12 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of the related Terms Agreement, either the Representative or the Depositor shall
have the right to postpone the related Closing Date for a period not exceeding
seven days in order to effect any required changes in the Registration
Statement, Prospectus or Prospectus Supplement or in any other documents or
arrangements.
17
<PAGE>
Section 13. Notices. All communications hereunder will be in writing
and:
(i) if sent to the Underwriters, will be mailed, delivered or
sent by facsimile transmission and confirmed to the Representative at:
Deutsche Bank Securities Inc.
31 West 52nd Street
New York, New York 10019
Attention: James Rothman
Telephone: (212) 469-8000
Facsimile: (212) 469-5923;
with a copy to:
Brown & Wood LLP
815 Connecticut Avenue, Suite 701, N.W.
Washington, D.C. 20006-4004
Attention: Edward E. Gainor
Telephone: (202) 973-0600
Facsimile: (202) 223-0485;
(ii) if sent to the Depositor, will be mailed, delivered or sent
by facsimile transmission, and confirmed to it at:
Deutsche Recreational Asset Funding Corporation
c/o Deutsche Financial Services Corporation
655 Maryville Centre Drive
St. Louis, Missouri 63141
Attention: Richard Schumacher
Telephone: (314) 523-3950
Facsimile: (314) 523-3993;
(iii) if sent to DFS, will be mailed, delivered or sent by
facsimile transmission, and confirmed to it at:
Deutsche Financial Services Corporation
655 Maryville Centre Drive
St. Louis, Missouri 63141
Attention: Richard Schumacher
Telephone: (314) 523-3950
Facsimile: (314) 523-3993;
or to such other address as DFS, the Depositor or the Representative may
designate in writing to the other parties hereto.
Section 14. Successors. This Underwriting Agreement will inure to the
benefit of and be binding upon the Underwriters, DFS and the Depositor and their
respective successors and the
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<PAGE>
officers and directors and controlling persons referred to in Section 7 hereof,
and no other person will have any right or obligations hereunder.
Section 15. Governing Law. THIS UNDERWRITING AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK. EACH PARTY HERETO HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF ANY NEW YORK STATE OR FEDERAL COURT SITTING IN THE BOROUGH OF
MANHATTAN IN THE CITY OF NEW YORK, NEW YORK OVER ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS UNDERWRITING AGREEMENT AND ANY TERMS
AGREEMENT, AND IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF THE ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE OR FEDERAL COURT, AND
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE
OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OF PROCEEDING.
Section 16. Nonpetition Covenant. Notwithstanding any prior termination
of this Underwriting Agreement or any Terms Agreement, the Underwriters shall
not acquiesce, petition or otherwise invoke or cause the Depositor or any Trust
to invoke the process of any court or government authority for the purpose of
commencing or sustaining a case against the Depositor or any Trust 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 Depositor or any Trust or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
Depositor or any Trust.
Section 17. Counterparts. This Underwriting Agreement may be executed
by each of the parties hereto in any number of counterparts, and by each of the
parties hereto on separate counterparts, each of which counterparts, when so
executed and delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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If the foregoing is in accordance with your understanding, please sign
and return to us a counterpart hereof, whereupon this letter and your acceptance
hereof shall constitute a binding agreement between the Underwriters, the
Depositor and DFS.
Very truly yours,
DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION
By:/s/ Richard C. Goldman
-------------------------------------
Name: Richard C. Goldman
Title: Vice President
By:/s/ Richard H. Schumacher
-------------------------------------
Name: Richard H. Schumacher
Title: Vice President
DEUTSCHE FINANCIAL SERVICES CORPORATION
By:/s/ Richard C. Goldman
-------------------------------------
Name: Richard C. Goldman
Title: Senior Vice President
By:/s/ Richard H. Schumacher
-------------------------------------
Name: Richard H. Schumacher
Title: Senior Vice President
Accepted in New York, New York,
as of the date hereof:
DEUTSCHE BANK SECURITIES INC.
By:/s/ James Rothman
--------------------------------
Name: JAMES ROTHMAN
Title: VICE PRESIDENT
By:/s/ David Bondy
--------------------------------
Name: DAVID BONDY
Title: DIRECTOR
Acting on behalf of itself and, if applicable, as the Representative of the
Underwriters named in the related Terms Agreement.
<PAGE>
EXHIBIT A
DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION
DISTRIBUTION FINANCIAL SERVICES RV TRUST _____-__
Asset Backed Securities
TERMS AGREEMENT
---------------
[Date]
To: Deutsche Recreational Asset Funding Corporation, as Depositor under the
Trust Agreement dated as of [Date] (the "Trust Agreement").
Re: Underwriting Agreement dated as of March 12, 1999 (the "Standard
Terms," and together with this Terms Agreement, the "Agreement").
Series Designation: Series ____.
Terms of the Series Securities: Distribution Financial Services RV
Trust ____-__ Asset Backed [Notes][Certificates], Class __, Class __, Class __,
Class __, Class __, Class __ and Class __ [Notes][Certificates] (the
"Securities") will evidence beneficial ownership interest in a pool of
Receivables having the characteristics described in the Prospectus Supplement
dated the date hereof. Only the Class __, Class __, Class __, Class __ and Class
__ [Notes] [Certificates] (collectively, the "Offered Securities") are being
sold pursuant to the terms hereof.
Registration Statement: File Number 33-______.
Ratings: It is a condition of Closing that at the Closing Date the
Class __ and Class __ Securities be rated "____" by _______________ ("____") and
"___" by _____________ ("_____"); that the Class __ Securities be rated "___" by
____ and "___" by ____; that the Class __ Securities be rated "__" by ____ and
"__" by _______.
Terms of Sale of Offered Securities: The Depositor agrees to sell to
Deutsche Bank Securities Inc. [and ______________________________ (the
"Underwriter[s]")] and Deutsche Bank Securities Inc. [and ___________________
each] agree[s][, severally and not jointly,] to purchase from the Depositor the
Offered Securities in the principal amounts and prices set forth beneath their
[respective] name[s] on Schedule 1. The purchase price for each class of the
Offered Securities shall be the applicable Purchase Price Percentage set forth
in Schedule 1 multiplied by the applicable principal amount.
<PAGE>
Cut-off Date: [Date]
Closing Date: 10:00 A.M., New York time, on or about [Date]. On the
Closing Date, the Depositor will deliver the Offered Securities to the
Underwriters against payment therefor.
Underwriter-Provided Information: The Depositor and DFS each
acknowledge and agree that the information set forth in (i) the table
immediately following the _______ paragraph under the caption "Underwriting" in
the Prospectus Supplement dated [Date], (ii) the _______ and _______ paragraphs
under such caption in such Prospectus Supplement and (iii) the table immediately
following the _______ paragraph under such caption in such Prospectus
Supplement, as such information relates to the Securities, constitute the only
information furnished in writing by or on behalf of the Underwriters for
inclusion in the Registration Statement, the Prospectus or the Prospectus
Supplement, and the Underwriters confirm that such statements are correct.
Incorporation of the Standard Terms: Each of the provisions of the
Standard Terms is incorporated herein by reference in its entirety and shall be
deemed to be a part of this Terms Agreement to the same extent as if such
provisions had been set forth in full herein and each of the representations and
warranties set forth therein shall be deemed to have been made on and as of the
date of this Terms Agreement, and the Standard Terms and this Terms Agreement
shall be construed as, together, one and the same agreement. Without limiting
the foregoing, Sections 14 through 17 of the Standard Terms are incorporated
herein by reference in their entirety.
A-2
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the undersigned a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement among the Underwriters, Deutsche Recreational Asset Funding
Corporation and Deutsche Financial Services Corporation.
Very truly yours,
DEUTSCHE BANK SECURITIES INC.
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
[Acting on behalf of itself and as the
Representative of the Underwriters
named herein.]
Accepted in New York, New York,
as of the date hereof:
DEUTSCHE RECREATIONAL ASSET FUNDING
CORPORATION
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
DEUTSCHE FINANCIAL SERVICES CORPORATION
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
A-3
<PAGE>
Schedule 1
----------
<TABLE>
<CAPTION>
Class Interest Purchase Approximate Approximate
- ----- Rate Initial Price Percentage Amount Amount
-------- Principal ---------------- Purchased by Purchased by
Amount (1) Deutsche Bank Securities [ ]
---------- Inc. ------------
<S> <C> -------------------------
Class $ % $ $
Class $ % $ $
Class $ % $ $
Class $ % $ $
Class $ % $ $
Total/ $ % $ $
Wtd Avg
</TABLE>
(1) Approximate.
A-4
<PAGE>
EXHIBIT B
1. DFS is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Nevada, and is duly qualified to
transact business and is in good standing in each jurisdiction in the United
States of America in which failure to so qualify would have a material adverse
effect on its business and financial condition.
2. The Depositor is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Nevada and is duly qualified to
transact business and is in good standing in each jurisdiction in the United
States in which the conduct of its business or the ownership of its property
requires such qualification.
3. The Depositor has the corporate power and corporate authority to carry on
its business as described in the Prospectus and to own its own assets in
connection therewith.
4. DFS and the Depositor each has the requisite power to execute and deliver
each Agreement (as applicable), Terms Agreement and the Underwriting Agreement
and to perform its obligations thereunder.
5. Each of the Agreements (as applicable), Terms Agreement and the
Underwriting Agreement has been duly and validly authorized, executed and
delivered by each of DFS and the Depositor, and each constitutes the valid,
legal and binding obligation of each of DFS and the Depositor, enforceable
against each of DFS and the Depositor in accordance with its terms, except as
enforceability thereof may be limited by bankruptcy, insolvency, reorganization
or other similar laws relating to or affecting the enforcement of creditors'
rights generally and by general equitable principles, regardless of whether such
enforceability is considered in a proceeding in equity or at law.
6. The Securities of the applicable Series have been duly and validly
authorized, and, when duly and validly executed and delivered in accordance with
the related Agreement, and following delivery to and payment therefor by the
Underwriters as provided in the related Terms Agreement, will be validly issued
and outstanding and entitled to the benefits of the related Agreement.
7. Neither the execution and delivery by DFS or the Depositor of any
Agreement (as applicable), a Terms Agreement or the Underwriting Agreement nor
the consummation of DFS or the Depositor of the transactions therein
contemplated, nor the issuance of the Securities of a Series by a Trust or the
public offering thereof as contemplated in the Prospectus and Prospectus
Supplement, will conflict with or result in a breach of, or constitute a default
(with notice or passage of time or both) under, or result in the imposition of
any lien, charge or encumbrance upon any of the property or assets of DFS or the
Depositor (except as required or permitted pursuant thereto) pursuant to any
indenture, mortgage, contract or other instrument to which DFS or the Depositor
is party or by which any of them is bound, nor will such action violate any
provision of the certificate of incorporation or by-laws of DFS or the
Depositor. To the best of such counsel's knowledge and information, the
execution and delivery of the Agreements, a Terms Agreement and the Underwriting
Agreement and the consummation of the transactions
<PAGE>
contemplated thereby will not result in the violation of the provisions of any
applicable federal or Missouri law, administrative regulation or court decree.
8. There are no legal or governmental proceedings pending or, to the
knowledge of such counsel, threatened which are required to be disclosed in the
Registration Statement, other than those disclosed therein, and all pending
legal or governmental proceedings to which DFS or the Depositor is a party or to
which any of its property is subject which are not described in the Registration
Statement, including ordinary routine litigation incidental to the business,
are, considered in the aggregate, not material. There are no legal or
governmental proceedings pending or, to the best of such counsel's knowledge and
information, threatened (A) asserting the invalidity of an Agreement or the
Securities of a Series, (B) seeking to prevent the issuance of such Securities
or the consummation by DFS or the Depositor of any of the transactions
contemplated by the Agreements, a Terms Agreement or the Underwriting Agreement
or (C) which might materially and adversely affect the performance by DFS or the
Depositor of its obligations under the Agreements (as applicable), a Terms
Agreement or the Underwriting Agreement.
9. No consent, approval, authorization or order of, or registration, filing
or declaration with, any court or governmental agency or body is required in
connection with (i) the execution and delivery by DFS or the Depositor of the
Agreements (as applicable), a Terms Agreement or of the Underwriting Agreement
or the performance by DFS or the Depositor of any of its obligations therein or
(ii) the offer, sale or delivery of the Securities of a Series, except such as
shall have been obtained or made, as the case may be, or will be obtained or
made, as the case may be, prior to the applicable Closing Date.
10. Each of DFS and the Depositor possesses all material licenses,
certificates, authorities or permits issued by the appropriate state or federal
regulatory agencies or bodies necessary to conduct the business now conducted by
it and as described in the Prospectus as amended and supplemented, except to the
extent that the failure to have such licenses, certificates, authorities or
permits does not have a material adverse effect on the Securities of a Series or
the financial condition of DFS or the Depositor, and neither DFS nor the
Depositor has received any notice of proceedings relating to the revocation or
modification of any such license, certificate, authority or permit which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would materially and adversely affect the conduct of its business,
operations or financial condition.
11. The Registration Statement has become effective under the Act and, to
the best of such counsel's knowledge, no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceeding for that purpose
has been instituted or threatened by the Commission. The Registration Statement
and the Prospectus as amended and supplemented (other than the financial
statements and other accounting information contained in the Registration
Statement or the Prospectus, or omitted therefrom, as to which such counsel does
not express any opinion) comply as to form in all material respects with the
requirements of the Act and the rules and regulations thereunder.
B-2
<PAGE>
12. There are no contracts or other documents required to be filed as an
exhibit to the Registration Statement or required to be described in the
Registration Statement or the Prospectus which are not so filed or described as
required.
13. The Securities, each Agreement and the Underwriting Agreement each
conform in all material respects with the descriptions thereof contained in the
Registration Statement and the Prospectus.
14. Each of DFS and the Depositor has full power and authority to sell and
assign the related Receivables and has duly authorized its sale and assignment
of such property by all necessary corporate action.
15. All filings necessary under applicable law to perfect the transfer of
the related Receivables by DFS to the Depositor pursuant to the related
Agreement have been made and, provided that DFS does not relocate its principal
place of business in a state other than Missouri, no other filings (other than
the filing of continuation statements) need be made to maintain the perfection
of the sale of such Receivables to the Depositor pursuant to the related
Agreement.
16. Immediately prior to the transfer of the related Receivables to the
Trust, the Depositor is the sole owner of all right, title and interest in, and
has good and marketable title to, such Receivables to be transferred by it to
the Trust. The assignment of the related Receivables, all documents and
instruments relating thereto and all proceeds thereof to the Trust, pursuant to
the related Agreement, vest in the Trust all interests which are purported to be
conveyed thereby, free and clear of all liens, security interests, encumbrances
or other rights of others, except as specifically permitted pursuant to the
related Agreement.
17. Immediately prior to the transfer of the related Receivables to the
Trust, the Depositor's interest in such Receivables and the proceeds of each of
the foregoing were perfected, to the extent any filing was necessary to effect
such perfection, upon the appropriate filing of the UCC-1 financing statement,
the form of which is attached to such opinion, and constituted a perfected
ownership interest therein, free and clear of all liens, security interests,
encumbrances and other rights of others, except as specifically permitted
pursuant to the related Agreement. If a court concludes that the transfer of the
related Receivables from the Depositor to the Trust is a sale, the interest of
the Trust in such Receivables and the proceeds of each of the foregoing was
perfected, to the extent any filing was necessary to effect such perfection,
upon the appropriate filing of the UCC-1 financing statement, the form of which
is attached to such opinion, and constitutes a perfected ownership interest
therein, free and clear of all liens, security interests, encumbrances and other
rights of others, except as specifically permitted pursuant to the related
Agreement. If a court concludes that such transfer is not a sale, the related
Agreement constitutes a grant by the Depositor to the Trust of a valid security
interest in the related Receivables and the proceeds of each of the foregoing,
which security interest was perfected upon the appropriate filing of the UCC-1
financing statement, the form of which is attached to such opinion, and
constitutes a first priority perfected security interest therein. No filing or
other action, other than the appropriate filing of the UCC-1 financing
statements, is necessary to perfect and maintain the ownership interest or the
security interest of the Trust in the related Receivables and the proceeds of
each of the foregoing against third parties.
B-3
<PAGE>
18. If applicable, immediately prior to the grant of the related
Receivables to the Indenture Trustee, the related Trust is the sole owner of all
right, title and interest in, and has good and marketable title to, such
Receivables to be granted by it to the Indenture Trustee. The assignment of the
related Receivables, all documents and instruments relating thereto and all
proceeds thereof to the Indenture Trustee, pursuant to the related Indenture,
vest in the Indenture Trustee all interests which are purported to be conveyed
thereby, free and clear of all liens, security interests, encumbrances or other
rights of others, except as specifically permitted pursuant to the related
Indenture.
19. If applicable, immediately prior to the grant of the related Receivables
to the Indenture Trustee, the related Trust's interest in such Receivables and
the proceeds of each of the foregoing were perfected, to the extent any filing
was necessary to effect such perfection, upon the appropriate filing of the
UCC-1 financing statement, the form of which is attached to such opinion, and
constituted a perfected ownership interest therein, free and clear of all liens,
security interests, encumbrances and other rights of others, except as
specifically permitted pursuant to the related Indenture. The related Indenture
constitutes a grant by the related Trust to the Indenture Trustee of a valid
security interest in the related Receivables and the proceeds of each of the
foregoing, which security interest was perfected upon the appropriate filing of
the UCC-1 financing statement, the form of which is attached to such opinion,
and constitutes a first priority perfected security interest therein. No filing
or other action, other than the appropriate filing of the UCC-1 financing
statements, is necessary to perfect and maintain the security interest of the
Indenture Trustee in the related Receivables and the proceeds of each of the
foregoing against third parties.
20. The related Trust Agreement is not required to be qualified under the
Trust Indenture Act of 1939, as amended. If applicable, the related Indenture
has been duly qualified under the Trust Indenture Act of 1939, as amended.
21. None of DFS, the Transferor, the Depositor or the related Trust is (and
none of them will, as a result of the offer and sale of the Securities of a
Series, be) an "investment company" or "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of 1940, as amended.
22. If applicable, the Class or Classes of Securities of a Series so
designated in the related Prospectus Supplement will be "eligible securities"
within the meaning of paragraph (a) of Rule 2a-7 under the Investment Company
Act of 1940, as amended.
23. The statements in the Prospectus Supplement under the headings "Summary
of Terms - Tax Status," "Summary of Terms - ERISA Considerations," "Summary of
Terms - Legal Investment," "Description of the Notes, " "Description of the
Transfer and Servicing Agreements," "Federal Income Tax Consequences," "State
and Local Tax Consequences" and "ERISA Considerations" and in the Prospectus
under the heading "Description of the Notes," "Description of the Certificates,"
"Certain Information Regarding the Securities," "Description of the Transfer and
Servicing Agreements," "Certain Legal Aspects of the Receivables," "Federal
Income Tax Consequences," "State and Local Tax Consequences" and "ERISA
Considerations," to the extent that they constitute matters of law or legal
conclusions with respect thereto, were prepared or reviewed by such counsel and
are correct in all material respects.
B-4
<PAGE>
24. Nothing has come to such counsel's attention that would lead such
counsel to believe that the Registration Statement, at the time it became
effective, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus and Prospectus
Supplement, at the date thereof or on the applicable Closing Date, included or
includes an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
B-5
<PAGE>
EXHIBIT C
1. The Trustee has been duly incorporated, formed or organized and is
validly existing in good standing under the laws of the jurisdiction governing
its incorporation, formation or organization with full trust power and authority
to enter into and perform its obligations under the related Agreement.
2. The related Agreement has been duly executed and delivered by the
Trustee, and, insofar as the laws governing the trust powers of the Trustee are
concerned and assuming due authorization, execution and delivery thereof by each
of the Depositor and DFS (as applicable), such Agreement constitutes a legal,
valid and binding obligation of the Trustee, enforceable against the Trustee in
accordance with its terms, except as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganizations or other similar laws relating to or
affecting the enforcement of creditor' rights generally and by general equitable
principles, regardless of whether such enforceability is considered in a
proceeding in equity or at law.
3. The related Securities have been duly executed, authenticated and
delivered by the Trustee.
4. Neither the execution nor delivery by the Trustee of the related
Agreement, nor the consummation of any of the transactions by the Trustee
contemplated thereby required the consent or approval of, the giving of notice
to, the registration with, or the taking of any other action with respect to,
any governmental authority or agency under any existing federal or related state
law governing the trust powers of the Trustee, except such as have been
obtained, made or taken.
<PAGE>
Exhibit 1.2
EXECUTION
DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION
DISTRIBUTION FINANCIAL SERVICES RV TRUST 1999-1
Asset Backed Securities
TERMS AGREEMENT
---------------
March 12, 1999
To: Deutsche Recreational Asset Funding Corporation, as Depositor under the
Trust Agreement dated as of March 1, 1999 (the "Trust Agreement").
Re: Underwriting Agreement dated as of March 12, 1999 (the "Standard
Terms," and together with this Terms Agreement, the "Agreement").
Series Designation: Series 1999-1.
Terms of the Series 1999-1 Securities: Distribution Financial Services
RV Trust 1999-1 Asset Backed Notes, Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class B, and Class C Notes (the "Securities") will
evidence beneficial ownership interest in a pool of Receivables having the
characteristics described in the Prospectus Supplement dated the date hereof.
Only the Class A-1, Class A-2, Class A-3, Class A-4, Class A-5, Class A-6, Class
B, and Class C Notes (collectively, the "Offered Securities") are being sold
pursuant to the terms hereof.
Registration Statement: File Number 333-56303.
Certificate Ratings: It is a condition of Closing that at the Closing
Date the Class A-1 Securities be rated "A-1+" by Standard & Poor's, a division
of the McGraw-Hill Companies, Inc. ("S&P") and "F1+" by Fitch IBCA ("Fitch");
that the Class A-2, Class A-3, Class A-4, Class A-5, and Class A-6 Securities be
rated "AAA" by S&P and by Fitch; that the Class B Securities be rated "A" by S&P
and by Fitch; and that the Class C Securities be rated "BBB" by S&P and by
Fitch.
Terms of Sale of Offered Securities: The Depositor agrees to sell to
Deutsche Bank Securities Inc., Bear, Stearns & Co. Inc. and Morgan Stanley & Co.
Incorporated (the "Underwriters") and Deutsche Bank Securities Inc., Bear,
Stearns & Co. Inc. and Morgan Stanley & Co. Incorporated each agree, severally
and not jointly, to purchase from the Depositor
<PAGE>
the Offered Securities in the principal amounts and prices set forth beneath
their respective names on Schedule 1. The purchase price for each class of the
Offered Securities shall be the applicable Purchase Price Percentage set forth
in Schedule 1 multiplied by the applicable principal amount.
Cut-off Date: March 1, 1999.
Closing Date: 10:00 A.M., New York time, on or about March 18, 1999.
On the Closing Date, the Depositor will deliver the Offered Securities to the
Underwriters against payment therefor.
Underwriter-Provided Information: The Depositor and DFS each
acknowledge and agree that the information set forth in (i) the table
immediately following the first paragraph under the caption "Underwriting" in
the Prospectus Supplement dated March 12, 1999, (ii) the second and third
paragraphs under such caption in such Prospectus Supplement and (iii) the table
immediately following the third paragraph under such caption in such Prospectus
Supplement, as such information relates to the Securities, constitute the only
information furnished in writing by or on behalf of the Underwriters for
inclusion in the Registration Statement, the Prospectus or the Prospectus
Supplement, and the Underwriters confirm that such statements are correct.
Incorporation of the Standard Terms: Each of the provisions of the
Standard Terms is incorporated herein by reference in its entirety and shall be
deemed to be a part of this Terms Agreement to the same extent as if such
provisions had been set forth in full herein and each of the representations and
warranties set forth therein shall be deemed to have been made on and as of the
date of this Terms Agreement, and the Standard Terms and this Terms Agreement
shall be construed as, together, one and the same agreement. Without limiting
the foregoing, Sections 14 through 17 of the Standard Terms are incorporated
herein by reference in their entirety.
2
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the undersigned a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement among the Underwriters, Deutsche Recreational Asset Funding
Corporation and Deutsche Financial Services Corporation.
Very truly yours,
DEUTSCHE BANK SECURITIES INC.
By:/s/ James Rothman
-----------------------------
Name: JAMES ROTHMAN
Title: VICE PRESIDENT
By:/s/ David Bondy
-----------------------------
Name: DAVID BONDY
Title: DIRECTOR
Acting on behalf of itself
and as the Representative
of the Underwriters named
herein.
Accepted in New York, New York,
as of the date hereof:
DEUTSCHE RECREATIONAL ASSET FUNDING
CORPORATION
By:/s/ Richard C. Goldman
--------------------------------
Name: Richard C. Goldman
Title: Vice President
By:/s/ Richard H. Schumacher
--------------------------------
Name: Richard H. Schumacher
Title: Vice President
DEUTSCHE FINANCIAL SERVICES CORPORATION
By:/s/ Richard C. Goldman
--------------------------------
Name: Richard C. Goldman
Title: Senior Vice President
By:/s/ Richard H. Schumacher
--------------------------------
Name: Richard H. Schumacher
Title: Senior Vice President
<PAGE>
Schedule 1
----------
<TABLE>
<CAPTION>
Approximate Approximate Approximate
Amount Amount Amount Purchased
Initial Purchase Purchased by Purchased by by Morgan
Interest Principal Price Deutsche Bank Bear, Stearns Stanley & Co.
Class Rate Amount (1) Percentage Securities Inc. & Co. Inc. Incorporated
----- ---- ----------- ---------- --------------- ---------- ------------
<S> <C>C <C> <C> <C> <C> <C>
Class A-1 4.97% $112,743,000 99.900000% $37,581,000 $37,581,000 $37,581,000
Class A-2 5.38 227,529,000 99.799484 75,843,000 75,843,000 75,843,000
Class A-3 5.70 197,998,000 99.735600 65,999,333 65,999,333 65,999,333
Class A-4 5.84 192,642,000 99.735422 64,214,000 64,214,000 64,214,000
Class A-5 5.97 159,722,000 99.715387 53,240,667 53,240,667 53,240,667
Class A-6 6.02 64,366,000 99.646257 21,455,333 21,455,333 21,455,333
Class B 6.36 25,000,000 99.391902 8,333,333 8,333,333 8,333,333
Class C 7.23 20,000,000 99.227946 6,666,667 6,666,667 6,666,667
Total $1,000,000,000
</TABLE>
(1) Approximate.
<PAGE>
Exhibit 4.1
AMENDED AND RESTATED TRUST AGREEMENT
between
DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION,
as Depositor,
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
as Owner Trustee
Dated as of March 1, 1999
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.01. Capitalized Terms.................................1
SECTION 1.02. Other Definitional Provisions.....................1
ARTICLE II
Organization
SECTION 2.01. Name..............................................2
SECTION 2.02. Office............................................2
SECTION 2.03. Purposes and Powers...............................2
SECTION 2.04. Appointment of Owner Trustee......................3
SECTION 2.05. Initial Capital Contribution of Owner
Trust Estate......................................3
SECTION 2.06. Declaration of Trust..............................3
SECTION 2.07. Liability of Owners...............................3
SECTION 2.08. Title to Trust Property...........................3
SECTION 2.09. Situs of Trust....................................4
SECTION 2.10. Representations and Warranties of the Depositor...4
SECTION 2.11. [Reserved]........................................5
SECTION 2.12. Federal Income Tax Allocations; Tax Treatment.....5
SECTION 2.13. Administrative Duties.............................6
SECTION 2.14. [Reserved]........................................7
ARTICLE III
Residual Interest
SECTION 3.01. Ownership.........................................7
SECTION 3.02. Maintenance of Office or Agency...................7
ARTICLE IV
Actions by Owner Trustee
SECTION 4.01. Prior Notice to the Residual Interestholder
with Respect to Certain Matters............8
SECTION 4.02. Action by the Residual Interestholder with
Respect to Certain Matters.................8
SECTION 4.03. [Reserved]........................................8
i
<PAGE>
SECTION 4.04. Restrictions on the Residual
Interestholder's Power.....................9
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01. Residual Interest Distribution Account............9
SECTION 5.02. Application of Trust Funds........................9
SECTION 5.03. Method of Payment................................10
SECTION 5.04. No Segregation of Moneys; No Interest............10
SECTION 5.05. Accounting and Reports to the Residual
Interestholder, Internal
Revenue Service and Others................10
SECTION 5.06. Signature on Returns; Tax Matters Partner........11
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.01. General Authority................................11
SECTION 6.02. General Duties...................................11
SECTION 6.03. Action upon Instruction..........................11
SECTION 6.04. No Duties Except as Specified in this
Agreement or in Instructions..............12
SECTION 6.05. No Action Except Under Specified Documents
or Instructions...........................13
SECTION 6.06. Restrictions.....................................13
ARTICLE VII
Concerning Owner Trustee
SECTION 7.01. Acceptance of Trusts and Duties..................13
SECTION 7.02. Furnishing of Documents..........................14
SECTION 7.03. Representations and Warranties...................14
SECTION 7.04. Reliance; Advice of Counsel......................15
SECTION 7.05. Not Acting in Individual Capacity................16
SECTION 7.06. Owner Trustee Not Liable for Residual
Interest or Receivables...................16
SECTION 7.07. Owner Trustee May Own Notes......................16
ARTICLE VIII
Compensation of Owner Trustee
SECTION 8.01. Owner Trustee's Fees and Expenses................17
SECTION 8.02. Indemnification..................................17
SECTION 8.03. Payments to Owner Trustee........................17
ii
<PAGE>
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01. Termination of Trust Agreement...................18
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.01. Eligibility Requirements for Owner Trustee......18
SECTION 10.02. Resignation or Removal of Owner Trustee.........18
SECTION 10.03. Successor Owner Trustee.........................19
SECTION 10.04. Merger or Consolidation of Owner Trustee........19
SECTION 10.05. Appointment of Co-Trustee or Separate Trustee...19
ARTICLE XI
Miscellaneous
SECTION 11.01. Supplements and Amendments......................20
SECTION 11.02. No Legal Title to Owner Trust Estate in
Residual Interestholder...................22
SECTION 11.03. Limitations on Rights of Others.................22
SECTION 11.04. Notices.........................................22
SECTION 11.05. Severability....................................22
SECTION 11.06. Separate Counterparts...........................22
SECTION 11.07. Successors and Assigns..........................23
SECTION 11.08. Covenants of the Depositor......................23
SECTION 11.09. No Petition.....................................23
SECTION 11.10. No Recourse.....................................23
SECTION 11.11. Headings........................................23
SECTION 11.12. GOVERNING LAW...................................23
SECTION 11.13. Benefit Plan.....................................24
SECTION 11.14. Submission to Jurisdiction......................24
iii
<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT dated as of March 1, 1999 (this
"Agreement"), between DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION, a Nevada
corporation, as depositor (the "Depositor"), and NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, a national banking association, as owner trustee (the
"Owner Trustee"). This Agreement amends and restates the Trust Agreement dated
as of February 25, 1999 between the parties hereto (the "Original Trust
Agreement").
ARTICLE I
Definitions
SECTION 1.01. Capitalized Terms. For all purposes of this Agreement,
capitalized terms used herein and defined in Appendix A to the Transfer and
Servicing Agreement shall have the meanings set forth in such Appendix A. The
"Transfer and Servicing Agreement" means the Transfer and Servicing Agreement,
dated the same date as this Agreement, among Distribution Financial Services RV
Trust 1999-1 (the "Trust"), the Depositor, and Deutsche Financial Services
Corporation, as Servicer.
SECTION 1.02. Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
unless otherwise defined therein.
(b) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto, accounting terms not defined in this
Agreement or in any such certificate or other document, and accounting terms
partly defined in this Agreement or in any such certificate or other document to
the extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles. To the extent that the definitions of
accounting terms in this Agreement or in any such certificate or other document
are inconsistent with the meanings of such terms under generally accepted
accounting principles, the definitions contained in this Agreement or in any
such certificate or other document shall control.
(c) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Article and Section
references contained in this Agreement are references to Articles and Sections
in or to this Agreement unless otherwise specified; and the term "including"
shall mean "including without limitation".
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
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(e) Any agreement, instrument or statute defined or referred to herein
(including the Transfer and Servicing Agreement referred to above) or in any
instrument or certificate delivered in connection herewith means such agreement,
instrument or statute as from time to time amended, amended and restated or
otherwise modified and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and assigns.
ARTICLE II
Organization
SECTION 2.01. Name. The trust created under the Original Trust
Agreement shall be known as "Distribution Financial Services RV Trust 1999-1,"
in which name the Owner Trustee may conduct the business of the Trust, make and
execute contracts and other instruments on behalf of the Trust and sue and be
sued.
SECTION 2.02. Office. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address outside of
New York as the Owner Trustee may designate by written notice to the Residual
Interestholder and the Depositor.
SECTION 2.03. Purposes and Powers.
(a) The purpose of the Trust is to engage in the following
activities:
(i) to acquire the Receivables and other Depositor
Conveyed Property pursuant to the Transfer and Servicing Agreement;
(ii) to issue the Notes pursuant to the Indenture and to
sell the Notes;
(iii) with the proceeds of the sale of the Notes to pay the
organizational, start-up and transactional expenses of the Trust and to
pay the balance to the Depositor;
(iv) to Grant the Trust Estate pursuant to the Indenture
and to hold, manage and distribute to the Residual Interestholder
pursuant to the terms of the Transfer and Servicing Agreement any
portion of the Trust Estate released from the Lien of, and remitted to
the Trust pursuant to, the Indenture;
(v) to enter into and perform its obligations under the
Basic Documents to which it is to be a party;
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(vi) 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
(vii) subject to compliance with the Basic Documents, to
engage in such other activities as may be required in connection with
conservation of the Owner Trust Estate and the making of distributions
to the Residual Interestholder and the Noteholders.
The Trust is hereby authorized to engage in the foregoing activities. The Trust
shall not engage in any activity other than in connection with the foregoing or
other than as required or authorized by the terms of this Agreement or the other
Basic Documents.
SECTION 2.04. Appointment of Owner Trustee. The Depositor hereby
confirms the appointment of 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.
SECTION 2.05. Initial Capital Contribution of Owner Trust Estate.
Pursuant to the Original Trust Agreement, the Depositor assigned, transferred,
conveyed and set over to the Owner Trustee, as of the date thereof, the sum of
$1. The Owner Trustee hereby acknowledges receipt in trust from the Depositor,
as of the date thereof, of the foregoing contribution, which shall constitute
the initial Owner Trust Estate and shall be deposited in the Residual Interest
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 2.06. Declaration of Trust. The Owner Trustee hereby declares
that it shall hold the Owner Trust Estate in trust upon and subject to the
conditions set forth herein for the use and benefit of the Residual
Interestholder, subject to the obligations of the Trust under the Basic
Documents. It is the intention of the parties hereto that the Trust constitute a
trust under the common law of the State of New York and that this Agreement
constitute the governing instrument of such trust.
SECTION 2.07. Liability of Owners. The Residual Interestholder shall
not have any personal liability for any liability or obligation of the Trust.
SECTION 2.08. Title to Trust Property. Legal title to all the Owner
Trust Estate shall be vested at all times in the Trust as a separate legal
entity except where applicable law in any jurisdiction requires title to any
part of the Owner Trust Estate to be vested in a trustee or trustees, in which
case title shall be deemed to be vested in the Owner Trustee, a co-trustee
and/or a separate trustee, as the case may be.
SECTION 2.09. Situs of Trust. The Trust shall be located and
administered in the State of Minnesota. All bank accounts maintained by the
Owner Trustee on behalf of the Trust shall
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be located in the State of Minnesota. The Trust shall not have any employees in
any state other than Minnesota; provided, however, that nothing herein shall
restrict or prohibit the Owner Trustee from having employees within or without
the State of Minnesota. Payments shall be received by the Trust only in
Minnesota, and payments shall be made by the Trust only from Minnesota. The only
office of the Trust shall be determined in accordance with Section 2.02.
SECTION 2.10. Representations and Warranties of the Depositor. The
Depositor hereby represents and warrants to the Owner Trustee that:
(i) The Depositor is duly organized and validly existing as a
corporation in good standing under the laws of the State of Nevada,
with power and authority to own its properties and to conduct its
business as such properties are currently owned and such business is
presently conducted.
(ii) 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 in which the ownership or
lease of its property or the conduct of its business shall require such
qualifications.
(iii) The Depositor has the power and authority to execute and
deliver this Agreement and to carry out its terms; the Depositor has
full power and authority to transfer and assign the property to be
transferred and assigned to and deposited with the Trust and the
Depositor has duly authorized such transfer and assignment and deposit
to the Trust by all necessary corporate action; and the execution,
delivery and performance of this Agreement have been duly authorized by
the Depositor by all necessary corporate action.
(iv) The consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof do not conflict with,
result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time) a default under,
the articles of incorporation or bylaws of the Depositor, or any
indenture, agreement or other instrument to which the Depositor is a
party or by which it is bound; nor result in the creation or imposition
of any Lien upon any of its properties pursuant to the terms of any
such indenture, agreement or other instrument (other than pursuant to
the Basic Documents); nor violate any law or, to the best of the
Depositor's knowledge, any 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 its properties.
(v) To the Depositor's best knowledge, there are no
proceedings or investigations pending or threatened before any court,
regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Depositor or its
properties: (A) asserting the invalidity of this Agreement, (B) seeking
to prevent the
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consummation of any of the transactions contemplated by this Agreement
or (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.
SECTION 2.11. [Reserved]
SECTION 2.12. Federal Income Tax Allocations; Tax Treatment.
(a) If the Residual Interest is held by more than one Person or the
Trust is recharacterized as a separate entity the net income of the Trust for
any month as determined for federal income tax purposes (and each item of
income, gain, loss and deduction entering into the computation thereof) shall be
allocated:
(1) first, to the holder(s) of interests in the Residual
Interest as of the close of business on the last day of such month, in
proportion to their interests in the Residual Interest, any amounts of
income payable in respect of the Residual Interest for such month; and
(2) second, to the holder(s) of interests in the Residual
Interest, and to other holders of interests in the Reserve Account, to
the extent of any remaining net income, in accordance with their
respective interest therein.
If the net income of the Trust for any month is insufficient for the allocations
described in subclause (a)(1), subsequent net income shall first be allocated to
make up such shortfall before being allocated as provided in the preceding
sentence. Net losses of the Trust, if any, for any month as determined for
federal income tax purposes (and each item of income, gain, loss and deduction
entering into the computation thereof) shall be allocated to the Depositor or
other holders of interests in the Reserve Account to the extent the Depositor or
other holders of interests in the Reserve Account are reasonably expected to
bear the economic burden of such net losses, and any remaining net losses shall
be allocated to any other holder of an interest in the Residual Interest as of
the close of business on the last day of such month in proportion to such
Person's interest in the Residual Interest on such day. The Depositor is
authorized to modify the allocations in this paragraph if necessary or
appropriate, in its sole discretion, for the allocations to fairly reflect the
economic income, gain or loss to the Depositor or other holders of interests in
the Reserve Account, or as otherwise required by the Code.
(b) All "excess nonrecourse liabilities" represented by all outstanding
Notes issued by the Trust, as well as the deductions attributable thereto, shall
be allocated one hundred percent to the Depositor in accordance with Treasury
Regulations section 1.752-3(a)(3). Notwithstanding any other provision of this
Agreement, if the Residual Interest is held solely by one Person or the Trust
has not been recharacterized as a separate entity, the application of clause (a)
and this clause (b) shall be disregarded.
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(c) It is the intent of the parties hereto that, solely for purposes of
federal income, state and local income, franchise and single business tax and
any other taxes measured in whole or in part by income, until the Residual
Interest is held by more than one Person or the Trust is recharacterized as a
separate entity, the Trust will be disregarded as an entity separate from its
beneficial owner and the Notes will be treated as debt. If the Residual Interest
is held by more than one Person or the Trust is recharacterized as a separate
entity, it is the intention of the parties hereto that, solely for purposes of
federal income, state and local income, franchise and single business tax and
any other taxes measured in whole or in part by income, the Trust shall be
treated as a partnership and the Residual Interestholder(s) and the Depositor
shall be treated as partners in that partnership with the assets of the
partnership being the Receivables and other assets held by the Trust, and the
Notes being debt of that partnership. The parties agree that, unless otherwise
required by appropriate tax authorities, the Trust shall file or cause to be
filed annual or other necessary returns, reports and other forms consistent with
the characterization of the Trust as a partnership for such tax purposes.
SECTION 2.13. Administrative Duties.
(a) Duties with Respect to the Specified Agreements. The Depositor
shall perform the duties of the Trust under the Indenture and the Note
Depository Agreement (collectively the "Specified Agreements"). In addition, the
Depositor shall consult with the Owner Trustee as the Depositor deems
appropriate regarding the duties of the Trust under the Specified Agreements.
The Depositor shall monitor the performance of the Trust's duties and shall
advise the Owner Trustee when action is necessary to comply with the Trust's
duties under the Specified Agreements. The Depositor shall prepare for execution
by the Owner Trustee or shall cause the preparation by other appropriate Persons
of all such documents, reports, filings, instruments, certificates and opinions
as it shall be the duty of the Trust to prepare, file or deliver pursuant to the
Specified Agreements. In furtherance of the foregoing, the Depositor shall take
all necessary action that is the duty of the Trust to take pursuant to Sections
3.04, 3.05, 3.06, 3.09, 3.14, 3.19, 6.08 and 7.03 of the Indenture.
(b) Duties with Respect to the Trust.
(i) In addition to the duties of the Depositor set forth in
the Basic Documents, but subject to the terms of the Basic Documents,
the Depositor shall perform such calculations and shall prepare for
execution by the Trust or the Owner Trustee or shall cause the
preparation by other appropriate Persons of all such documents,
reports, filings, instruments, certificates and opinions as it shall be
the duty of the Trust or the Owner Trustee to prepare, file or deliver
pursuant to state and federal tax and securities laws and shall take
all other appropriate action that it is the duty of the Trust or the
Owner Trustee to take pursuant to the Basic Documents relating to the
preparation and filing of tax returns, the furnishing of documents and
with respect to supplements and amendments of the Specified Agreements.
In accordance with the request of the Owner
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Trustee but subject to the terms of the Basic Documents, the Depositor
shall administer, perform or supervise the performance of such other
activities in connection with the Basic Documents as are not covered by
any of the foregoing provisions and as are expressly requested by the
Owner Trustee and are reasonably within the capability of the
Depositor.
(ii) Notwithstanding anything in this Agreement or any of the
other Basic Documents to the contrary, the Depositor shall be
responsible for promptly notifying the Owner Trustee in the event that
any withholding tax is imposed on the Trust's payments (or allocations
of income) to the Residual Interestholder. Any such notice shall be in
writing and specify the amount of any withholding tax required to be
withheld by the Owner Trustee.
(c) Records. The Depositor shall maintain appropriate books of account,
including capital accounts, and records relating to the Trust, which books of
account and records shall be accessible for inspection by the Owner Trustee at
any time during normal business hours.
(d) Additional Information to be Furnished to the Trust. The Depositor
shall furnish to the Owner Trustee from time to time such additional information
regarding the Trust or the Basic Documents as the Owner Trustee shall reasonably
request.
SECTION 2.14. [Reserved].
ARTICLE III
Residual Interest
SECTION 3.01. Ownership. The Residual Interest shall represent an
undivided ownership interest in the Trust. The Depositor shall be the only
holder of the Residual Interest. The Residual Interest shall not be
certificated, shall not have a principal balance and shall not bear interest.
The Depositor shall not sell, assign, pledge or otherwise transfer the Residual
Interest. Any amendment to this Agreement which would change the foregoing shall
be subject to the condition that the Depositor shall retain at least 1/10th of
1% of the Residual Interest.
SECTION 3.02. Maintenance of Office or Agency. The Owner Trustee
shall maintain an office or offices or agency or agencies outside of New York
where notices and demands to or upon the Owner Trustee in respect of the
Residual Interest and the Basic Documents may be served. The Owner Trustee
initially designates the Corporate Trust Office of the Owner Trustee
as its office for such purposes. The Owner Trustee shall give prompt written
notice to the Depositor, the Servicer and the Indenture Trustee of any change in
the location of any such office or agency.
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ARTICLE IV
Actions by Owner Trustee
SECTION 4.01. Prior Notice to the Residual Interestholder with Respect
to Certain Matters. With respect to the following matters, the Owner Trustee
shall not take action unless, at least 30 days before the taking of such action,
the Owner Trustee shall have notified the Residual Interestholder in writing of
the proposed action and the Residual Interestholder shall not have notified the
Owner Trustee in writing prior to the 30th day after such notice is given that
the Residual Interestholder has withheld consent or provided alternative
direction:
(a) the initiation of any claim or lawsuit by the Trust (except claims
or lawsuits brought in connection with collection of the Receivables) and the
compromise of any action, claim or lawsuit brought by or against the Trust
(except with respect to the aforementioned claims or lawsuits brought in
connection with collection of the Receivables);
(b) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(c) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interests of the Residual
Interestholder; or
(d) the appointment pursuant to the Indenture of a successor Note
Registrar or Indenture Trustee, or the consent to the assignment by the Note
Registrar or Indenture Trustee of its obligations under the Indenture.
SECTION 4.02. Action by the Residual Interestholder with Respect to
Certain Matters. The Owner Trustee shall not have the power, except upon the
direction of the Residual Interestholder, to remove the Servicer under the
Transfer and Servicing Agreement pursuant to Section 8.01 thereof or, except as
expressly provided in the Basic Documents, to sell the Receivables after the
termination of the Indenture. The Owner Trustee shall take the actions referred
to in the preceding sentence only upon written instructions signed by the
Residual Interestholder.
SECTION 4.03. [Reserved].
SECTION 4.04. Restrictions on the Residual Interestholder's Power. The
Residual Interestholder shall not direct the Owner Trustee to take or to refrain
from taking any action if such action or inaction would be contrary to any
obligation of the Trust or the Owner Trustee under this Agreement or any of the
other Basic Documents or would be contrary to Section 2.03, nor shall the Owner
Trustee be obligated to follow any such direction, if given.
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ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01. Residual Interest Distribution Account. The Owner
Trustee, for the benefit of the Residual Interestholder, shall establish and
maintain in the name of the Trust an Eligible Deposit Account (the "Residual
Interest Distribution Account" or "Residual Interestholder Distribution
Account"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Residual Interestholder.
The Owner Trustee shall possess all right, title and interest in all funds on
deposit from time to time in the Residual Interest Distribution Account and in
all proceeds thereof. Except as otherwise provided herein or in the Transfer and
Servicing Agreement, the Residual Interest Distribution Account shall be under
the sole dominion and control of the Owner Trustee for the benefit of the
Residual Interestholder. If, at any time, the Residual Interest Distribution
Account ceases to be an Eligible Deposit Account, the Owner Trustee (or the
Depositor on behalf of the Owner Trustee, if the Certificate Distribution
Account is not then held by the Owner Trustee or an Affiliate thereof) shall
within 10 Business Days (or such longer period, not to exceed 30 calendar days,
as to which each Rating Agency may consent) establish a new Residual Interest
Distribution Account as an Eligible Deposit Account and shall transfer any cash
and/or any investments to such new Residual Interest Distribution Account.
SECTION 5.02. Application of Trust Funds.
(a) On each Monthly Payment Date, the Owner Trustee shall distribute to
the Residual Interestholder, amounts, if any received from the Indenture Trustee
pursuant to Section 5.06(b) of the Transfer and Servicing Agreement with respect
to such Monthly Payment Date or received pursuant to Section 5.04 of the
Indenture.
(b) On each Monthly Payment Date, the Owner Trustee shall send to the
Residual Interestholder the statement or statements provided to the Owner
Trustee by the Servicer pursuant to Section 5.08 of the Transfer and Servicing
Agreement with respect to such Monthly Payment Date.
(c) In the event that any withholding tax is imposed on the Trust's
payment (or allocations of income) to a Residual Interestholder, such tax shall
reduce the amount otherwise distributable to the Residual Interestholder in
accordance with this Section. The Owner Trustee is hereby authorized and
directed to retain from amounts otherwise distributable to the Residual
Interestholder's 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 a Residual Interestholder
shall be treated as cash distributed to the Residual Interestholder at the
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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. Residual
Interestholder), the Owner Trustee may in its sole discretion withhold such
amounts in accordance with this paragraph (c).
SECTION 5.03. Method of Payment. Subject to Section 9.01(c),
distributions required to be made to Residual Interestholder on any Monthly
Payment Date shall be made to the Residual Interestholder either by wire
transfer, in immediately available funds, to the account of such Residual
Interestholder at a bank or other entity having appropriate facilities therefor,
if the Residual Interestholder shall have provided to the Owner Trustee
appropriate written instructions at least five Business Days prior to such
Monthly Payment Date or, if not, by check mailed to the Residual Interestholder
at the address of the Residual Interestholder determined in accordance with
Section 11.04.
SECTION 5.04. No Segregation of Moneys; No Interest. Moneys received by
the Owner Trustee hereunder need not be segregated in any manner except to the
extent required by law or the Basic Documents 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.
SECTION 5.05. Accounting and Reports to the Residual Interestholder,
Internal Revenue Service and Others. Subject to Section 2.12, the Depositor
shall (a) maintain (or cause to be maintained) the books of the Trust on a
calendar year basis and the accrual method of accounting, (b) prepare and
deliver to the Residual Interestholder during such calendar year, as may be
required by the Code and applicable Treasury Regulations, and not later than the
latest date permitted by law, such information as may be required (including
Schedule K-1) to enable the Residual Interestholder to prepare its federal and
state income tax returns, (c) prepare and file such tax returns relating to the
Trust (including a partnership information return, IRS Form 1065) and make such
elections as from time to time may be required or appropriate under any
applicable state or federal statute or any rule or regulation thereunder so as
to maintain the Trust's characterization as a disregarded entity if there is
only one Residual Interestholder, or, if there is more than one Residual
Interestholder, as a partnership for federal income tax purposes, (d) cause such
tax returns to be signed in the manner required by law and (e) collect or cause
to be collected any withholding tax as described in and in accordance with
Section 5.02(c) with respect to income or distributions to the Residual
Interestholder. The Owner Trustee shall elect under Section 1278 of the Code to
include in income currently any market discount that accrues with respect to the
Receivables. The Owner Trustee shall not make the election provided under
Section 754 of the Code.
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SECTION 5.06. Signature on Returns; Tax Matters Partner.
(a) Subject to Section 2.12, the Owner Trustee shall sign on behalf of
the Trust the tax returns of the Trust, unless applicable law requires the
Depositor to sign such documents, in which case such documents shall be signed
by the Depositor.
(b) The Depositor shall be designated the "tax matters partner" of the
Trust pursuant to Section 6231(a)(7)(A) of the Code and applicable Treasury
Regulations.
ARTICLE VI
Authority and Duties of Owner Trustee
SECTION 6.01. General Authority. The Owner Trustee is authorized and
directed to execute and deliver the Basic 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 Basic Documents to which the Trust is to be a party and, in
each case, in such form as the Depositor shall approve, as evidenced
conclusively by the Owner Trustee's execution thereof. 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 Basic Documents. The Owner
Trustee is further authorized from time to time to take such action as the
Depositor recommends with respect to the Basic Documents.
SECTION 6.02. General Duties. It shall be the duty of the Owner Trustee
to discharge (or cause to be discharged) all of its responsibilities pursuant to
the terms of this Agreement and the other Basic Documents to which the Trust is
a party and to administer the Trust in the interest of the Residual
Interestholder, subject to the Basic Documents and in accordance with the
provisions of this Agreement. Notwithstanding the foregoing, the Owner Trustee
shall be deemed to have discharged its duties under the Basic Documents to the
extent the Depositor has agreed to perform them pursuant to Section 2.13 of this
Agreement.
SECTION 6.03. Action upon Instruction.
(a) Subject to Article IV and to the other terms of the Basic
Documents, the Residual Interestholder may by written instruction direct the
Owner Trustee in the management of the Trust. Such direction may be exercised at
any time by written instruction of the Residual Interestholder pursuant to
Article IV.
(b) The Owner Trustee shall not be required to take any action
hereunder or under any other Basic Document if the Owner Trustee shall have
reasonably determined, or shall have been advised by counsel, that such action
is likely to result in liability on the part of the Owner Trustee or is contrary
to the terms hereof or of any other Basic Document or is otherwise contrary to
law.
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(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or under
any other Basic Document, the Owner Trustee shall promptly give notice (in such
form as shall be appropriate under the circumstances) to the Residual
Interestholder requesting instruction as to the course of action to be adopted,
and to the extent the Owner Trustee acts in good faith in accordance with any
written instruction of the Residual Interestholder, 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 10 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 other Basic Documents, as it shall deem to be in the best interests of
the Residual Interestholder, 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 other Basic 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 Residual
Interestholder requesting instruction and, to the extent that the Owner Trustee
acts or refrains from acting in good faith in accordance with any such
instruction from the Residual Interestholder, 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 10 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 other Basic Documents, as it shall deem to be in the best
interests of the Residual Interestholder, and shall have no liability to any
Person for such action or inaction.
SECTION 6.04. No Duties Except as Specified in this Agreement 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 Owner Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with, any document contemplated hereby
to which the Owner Trustee is a party, except as expressly provided by the terms
of this Agreement, any other Basic Document to which the Trust is a party or in
any written instruction received by the Owner Trustee as contemplated by Section
6.03; and no implied duties or obligations shall be read into this Agreement or
any other Basic Document against the Owner Trustee. The Owner Trustee shall have
no responsibility for filing any financing or continuation statement in any
public office at any time or to otherwise perfect or maintain the perfection of
any security interest or lien granted to it hereunder or to prepare or file any
Securities and Exchange Commission filing for the Trust or to record this
Agreement or any other Basic Document. The Owner Trustee nevertheless agrees
that it shall, at its own cost and expense, promptly take all action as may be
necessary to discharge any Liens on any part of
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the Owner Trust Estate that result from actions by, or claims against, the Owner
Trustee that are not related to the ownership or the administration of the Owner
Trust Estate.
SECTION 6.05. 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 Owner Trust Estate 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 Basic Documents
and (iii) in accordance with any instruction delivered to the Owner Trustee as
contemplated by Section 6.03.
SECTION 6.06. Restrictions. The Owner Trustee shall not take any action
(a) that is inconsistent with the purposes of the Trust set forth in Section
2.03 or (b) that, to the actual knowledge of the Owner Trustee, would result in
the Trust's becoming taxable as a corporation for federal income tax purposes.
The Residual Interestholder shall not direct the Owner Trustee to take action
that would violate the provisions of this Section.
ARTICLE VII
Concerning Owner Trustee
SECTION 7.01. Acceptance of Trusts 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 moneys actually received by it
constituting part of the Owner Trust Estate upon the terms of the Basic
Documents and this Agreement. The Owner Trustee shall not be answerable or
accountable hereunder or under any other Basic Document under any circumstances,
except (i) for its own willful misconduct or negligence or (ii) in the case of
the inaccuracy of any representation or warranty contained in Section 7.03
expressly made by the Owner Trustee. 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 by a Trust 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 accordance with the instructions of the
Residual Interestholder.
(c) No provision of this Agreement or any other Basic 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 other Basic 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.
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(d) Under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under any of the Basic Documents, including
the principal of and interest on the Notes.
(e) The Owner Trustee shall not be responsible for or in respect of the
validity or sufficiency of this Agreement or for the due execution hereof by the
Depositor or for the form, character, genuineness, sufficiency, value or
validity of any of the Owner Trust Estate, or for or in respect of the validity
or sufficiency of the Basic Documents, and the Owner Trustee shall in no event
assume or incur any liability, duty or obligation to any Noteholder or to the
Residual Interestholder, other than as expressly provided for herein or
expressly agreed to in the Basic Documents.
(f) The Owner Trustee shall not be liable for the default or misconduct
of the Depositor, the Indenture Trustee or the Servicer under any of the Basic
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
other Basic Documents that are required to be performed by the Indenture Trustee
under the Indenture or the Servicer or the Depositor under the Transfer and
Servicing Agreement.
(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 other Basic Document, at the request, order or direction of the
Residual Interestholder, unless the Residual Interestholder has 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 other Basic Document shall not be
construed as a duty, and the Owner Trustee shall not be answerable for other
than its negligence or willful misconduct in the performance of any such act.
SECTION 7.02. Furnishing of Documents. The Owner Trustee shall furnish
to the Residual Interestholder, 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 Basic Documents.
SECTION 7.03. Representations and Warranties. The Owner Trustee
hereby represents and warrants to the Depositor, for the benefit of the Residual
Interestholder, that:
(a) The Owner Trustee is a national banking association duly organized
and validly existing in good standing under the laws of the United States. The
Owner Trustee has all requisite power and authority to execute, deliver and
perform its obligations under this Agreement and each other Basic Document to
which it is a party.
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(b) The Owner Trustee has taken all action necessary to authorize the
execution and delivery by it of this Agreement and each of the other Basic
Documents to which it is a party, and this Agreement and each of the other Basic
Documents to which it is a party has been executed and delivered by one of its
officers who is duly authorized to execute and deliver this Agreement and each
of the other Basic Documents to which it is a party on its behalf.
(c) This Agreement and each of the other Basic Documents to which it is
a party constitutes a legal, valid and binding obligation of the Owner Trustee,
enforceable against the Owner Trustee in accordance with its respective terms,
subject, as to enforceability, to applicable bankruptcy, insolvency,
reorganization, conservatorship, receivership, liquidation and other similar
laws affecting enforcement of the rights of creditors of banks generally and to
equitable limitations on the availability of specific remedies.
(d) Neither the execution or the delivery by the Owner Trustee of this
Agreement and each of the other Basic Documents to which it is a party, nor the
consummation by it of the transactions contemplated hereby and thereby, nor
compliance by it with any of the terms or provisions hereof and thereof, shall
contravene any federal or state 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 bylaws
or any indenture, mortgage, contract, agreement or instrument to which it is a
party or by which any of its properties may be bound.
(e) The Owner Trustee has received the Schedule of Receivables.
SECTION 7.04. 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 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 other
Basic 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
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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 other Basic Document.
SECTION 7.05. Not Acting in Individual Capacity. Except as provided in
this Article VII, in accepting the trusts hereby created, Norwest Bank
Minnesota, National Association, 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
other Basic Document shall look only to the Owner Trust Estate for payment or
satisfaction thereof.
SECTION 7.06. Owner Trustee Not Liable for Residual Interest or
Receivables. The recitals contained herein 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 other Basic Document or of the
Residual Interest or the Notes, or of any Receivable or related documents. The
Owner Trustee shall at no time have any responsibility or liability for or with
respect to the legality, validity and enforceability of any Receivable or the
perfection and priority of any security interest created by any Receivable in
any Financed Vehicle or the maintenance of any such perfection and priority, or
for or with respect to the sufficiency of the Owner Trust Estate or its ability
to generate the payments to be distributed to the Residual Interestholder under
this Agreement or the Noteholders under the Indenture, including, without
limitation: the existence, condition and ownership of any Financed Vehicle; the
existence and enforceability of any insurance thereon; the existence and
contents of any Receivable on any computer or other record thereof; the validity
of the transfer of any Receivable to the Trust or of any intervening transfer;
the completeness of any Receivable; the performance or enforcement of any
Receivable; the compliance by the Depositor or the Servicer with any warranty or
representation made under any other Basic 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 or any subservicer taken in the name of the
Owner Trustee.
SECTION 7.07. Owner Trustee May Own Notes. The Owner Trustee in its
individual or any other capacity may become the owner or pledgee of Notes and
may deal with the Depositor, the Indenture Trustee and the Servicer in banking
transactions with the same rights as it would have if it were not Owner Trustee.
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ARTICLE VIII
Compensation of Owner Trustee
SECTION 8.01. Owner Trustee's Fees and Expenses. The Owner Trustee
shall receive as compensation for its services hereunder reasonable expenses
incurred before the date hereof and such fees as have been separately agreed
upon before the date hereof between the Depositor and the Owner Trustee, and the
Owner Trustee shall be entitled to be reimbursed by the Depositor for its other
reasonable expenses hereunder incurred after the date hereof, 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.
SECTION 8.02. Indemnification. The Depositor shall be liable as primary
obligor for, and shall indemnify the Owner Trustee and its successors, assigns,
agents and servants (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 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 other Basic Documents, the Owner Trust
Estate, the administration of the Owner Trust Estate or the action or inaction
of the Owner Trustee hereunder, except only that the Depositor shall not be
liable for or required to indemnify an Indemnified Party from and against
Expenses arising or resulting from any of the matters described in the third
sentence of Section 7.01. The indemnities contained in this Section shall
survive the resignation or termination of the Owner Trustee or the termination
of this Agreement. In any event of any claim, action or proceeding for which
indemnity shall be sought pursuant to this Section, the Owner Trustee's choice
of legal counsel shall be subject to the approval of the Depositor, which
approval shall not be unreasonably withheld.
SECTION 8.03. Payments to Owner Trustee. Any amounts paid to the Owner
Trustee pursuant to this Article VIII shall be deemed not to be a part of the
Owner Trust Estate immediately after such payment.
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01. Termination of Trust Agreement.
(a) This Agreement (other than Article VIII) and the Trust shall
terminate and be of no further force or effect upon the final distribution by
the Owner Trustee of all moneys or other property or proceeds of the Owner Trust
Estate in accordance with the terms of the Indenture,
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the Transfer and Servicing Agreement and Article V. The bankruptcy, liquidation,
dissolution, death or incapacity of the Residual Interestholder shall not (x)
operate to terminate this Agreement or the Trust or (y) entitle the Residual
Interestholder'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 Owner Trust Estate or (z) otherwise affect the
rights, obligations and liabilities of the parties hereto.
(b) Except as provided in Section 9.01(a), none of the Depositor or the
Residual Interestholder shall be entitled to revoke or terminate the Trust.
ARTICLE X
Successor Owner Trustees and Additional Owner Trustees
SECTION 10.01. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a bank authorized to exercise corporate trust
powers; having a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by federal or state authorities; and
having (or having a parent that has) time deposits that are rated at least A-1
by Standard & Poor's and F1+ by Fitch. If such bank 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 bank 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 10.02.
SECTION 10.02. 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. Upon receiving such notice of
resignation, the Depositor shall promptly appoint a successor Owner Trustee 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. 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 10.01 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
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immediately preceding sentence, the Depositor shall promptly appoint a successor
Owner Trustee 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 shall pay 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 acceptance of appointment by the successor Owner
Trustee pursuant to Section 10.03 and payment of all fees and expenses owed to
the outgoing Owner Trustee. The Depositor shall provide notice of such
resignation or removal of the Owner Trustee to each of the Rating Agencies.
SECTION 10.03. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.02 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 upon payment of its fees and expenses 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 10.01.
Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Depositor shall mail notice thereof to the Indenture Trustee,
the Noteholders and the Rating Agencies. If the Depositor shall fail to mail
such notice within 10 days after acceptance of such appointment by the successor
Owner Trustee, the successor Owner Trustee shall cause such notice to be mailed
at the expense of the Depositor.
SECTION 10.04. 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, 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; provided, that such corporation
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shall be eligible pursuant to Section 10.01 and, provided, further, that the
Owner Trustee shall mail notice of such merger or consolidation to the Rating
Agencies.
SECTION 10.05. 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 Owner Trust Estate or any Financed Vehicle may at the time be located,
the Depositor and the Owner Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Depositor and Owner Trustee to act as co-trustee, jointly with
the Owner Trustee, or as separate trustee or separate trustees, of all or any
part of the Owner Trust Estate, 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
Depositor and the Owner Trustee may consider necessary or desirable. If the
Depositor shall not have joined in such appointment within 15 days after the
receipt by it of a request so to do, the Owner Trustee alone shall have the
power to make such appointment. No co-trustee or separate trustee under this
Agreement shall be required to meet the terms of eligibility as a successor
Owner Trustee pursuant to Section 10.01 and no notice of the appointment of any
co-trustee or separate trustee shall be required pursuant to Section 10.03.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(a) 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 Owner Trust Estate 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;
(b) No trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement; and
(c) The Depositor and the Owner Trustee acting jointly 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
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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 as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. 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 co-trustee or separate trustee.
ARTICLE XI
Miscellaneous
SECTION 11.01. Supplements and Amendments. This Agreement may be
amended from time to time by the Depositor and the Owner Trustee, with prior
written notice to the Rating Agencies, without the consent of any of the
Noteholders or the Residual Interestholder, to cure any ambiguity, to correct or
supplement any provisions in this Agreement or for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions in
this Agreement or of modifying in any manner the rights of the Noteholders or
the Residual Interestholder; 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 or Residual Interestholder.
This Agreement may also be amended from time to time by the Depositor
and the Owner Trustee, without the consent of any of the Noteholders or the
Residual Interestholder, in order to enable all or a portion of the Trust to
qualify as a "financial asset securitization investment trust" under federal tax
laws and regulations (a "FASIT"), to permit a FASIT election to be made under
such laws and regulations and to make such modifications to this Agreement as
may be permitted by reason of the making of such election; provided that (i) the
Rating Agency Condition shall have been satisfied with respect thereto, (ii) an
Opinion of Counsel is rendered that such election will not have material adverse
consequences to any Noteholder or to the Residual Interestholder, and (iii) the
ability of the FASIT to add or remove assets shall be limited to the same extent
as "real estate mortgage investment conduits" ("REMICs") under applicable
federal tax laws and regulations.
This Agreement may also be amended from time to time by the Depositor
and the Owner Trustee, with prior written notice to the Rating Agencies, with
the consent of the Majority Noteholders and the consent of the Residual
Interestholder, for the purpose of adding any
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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 Noteholders or
the Residual Interestholder; 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 Receivables or distributions that shall be
required to be made for the benefit of the Noteholders or the Residual
Interestholder; or (b) reduce the percentage of the Outstanding Amount of the
Notes required to consent to any such amendment to less than the percentage
contemplated by the definition of Majority Noteholders, without the consent of
the Holders of all the outstanding Notes.
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 Residual Interestholder, the Indenture Trustee and
each of the Rating Agencies.
It shall not be necessary for the consent of the Residual
Interestholder or the 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 Residual Interestholder provided for in
this Agreement or in any other Basic Document) and of evidencing the
authorization of the execution thereof by Residual Interestholder shall be
subject to such reasonable requirements as the Owner Trustee may prescribe.
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. The Owner Trustee may, but shall not be obligated to, enter into any
such amendment that affects the Owner Trustee's own rights, duties or immunities
under this Agreement or otherwise.
In connection with the execution of any amendment to this Trust
Agreement or any amendment of any other agreement to which the Issuer is a
party, the Owner Trustee shall be entitled to receive and conclusively rely upon
an Opinion of Counsel to the effect that such amendment is authorized or
permitted by the Basic Documents and that all conditions precedent in the Basic
Documents for the execution and delivery thereof by the Issuer or the Owner
Trustee, as the case may be, have been satisfied.
The Owner Trustee shall comply with Section 3.07(g) of the Indenture
with respect to the amendments, modifications, supplements, terminations and
surrenders referred to therein.
SECTION 11.02. No Legal Title to Owner Trust Estate in Residual
Interestholder. The Residual Interestholder shall not have legal title to any
part of the Owner Trust Estate. The Residual Interestholder shall be entitled to
receive distributions with respect to its undivided ownership interest in the
Trust only in accordance with the terms of this Agreement and the other Basic
Documents. No transfer, by operation of law or otherwise, of any right, title or
interest of the Residual Interestholder to and in its undivided ownership
interest shall operate to
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terminate this Agreement or the trusts hereunder or entitle any transferee to an
accounting or to the transfer to it of legal title to any part of the Owner
Trust Estate.
SECTION 11.03. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Owner Trustee, the Depositor, the
Residual Interestholder and, to the extent expressly provided herein, the
Indenture Trustee and the Noteholders, and nothing in this Agreement, whether
express or implied, shall be construed to give to any other Person any legal or
equitable right, remedy or claim in the Owner Trust Estate or under or in
respect of this Agreement or any covenants, conditions or provisions contained
herein.
SECTION 11.04. Notices. Unless otherwise expressly specified or
permitted by the terms hereof, all notices shall be in writing and shall be
deemed given upon receipt by the intended recipient or three Business Days after
mailing if mailed by certified mail, postage prepaid (except that notice to the
Owner Trustee shall be deemed given only upon actual receipt by the Owner
Trustee), if to the Owner Trustee, addressed to Norwest Bank Minnesota, National
Association, Sixth & Marquette, Minneapolis, Minnesota 55479-0070, Attention:
Corporate Trust Services/Asset-Backed Administration; if to the Depositor or the
Residual Interestholder, addressed to Deutsche Recreational Asset Funding
Corporation, 655 Maryville Centre Drive, St. Louis, MO 63141, Attention: Senior
Vice President/Treasurer or Chief Legal Counsel; or, as to each party, at such
other address as shall be designated by such party in a written notice to the
other party hereto.
SECTION 11.05. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 11.06. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 11.07. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, each of the
Depositor and its permitted assigns, the Owner Trustee and its successors and
the Residual Interestholder and its successors and permitted assigns, all as
herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by the Residual Interestholder shall bind the successors
and assigns of the Residual Interestholder.
SECTION 11.08. Covenants of the Depositor. In the event that any
litigation with claims in excess of $1,000,000 to which the Depositor is a party
which shall be reasonably likely to result in a material judgment against the
Depositor that the Depositor shall not be able to satisfy shall be commenced by
the Residual Interestholder, during the period beginning nine
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months following the commencement of such litigation and continuing until such
litigation is dismissed or otherwise terminated (and, if such litigation has
resulted in a final judgment against the Depositor, such judgment has been
satisfied), the Depositor shall not declare any dividend or make any other
distribution on or in respect of its shares to any of its equity holders, or
repay the principal amount of any indebtedness of the Depositor held by any
Affiliate of the Depositor, unless (i) after giving effect to such distribution
or repayment, the Depositor's liquid assets shall not be less than the amount of
actual damages claimed in such litigation or (ii) the Rating Agency Condition
shall have been satisfied with respect to any such distribution or repayment.
SECTION 11.09. No Petition. The Owner Trustee, by entering into this
Agreement, and each Noteholder and Note Owner, by accepting the benefits of this
Agreement, hereby covenant and agree that they shall not at any time, acquiesce,
petition or otherwise invoke or cause (or join with any other Person in
acquiescing, petitioning or otherwise invoking or causing) the Depositor or the
Trust to invoke the process of any court or government authority for the purpose
of commencing or sustaining a case against the Depositor or the Trust 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 Depositor or the Trust or any substantial part of the
property of the Depositor or the Trust, or ordering the winding up or
liquidation of the affairs of the Depositor or the Trust.
SECTION 11.10. No Recourse. The Residual Interestholder acknowledges
that the Residual Interest represents an undivided ownership interest in the
Trust only and does not represent interests in or obligations of the Depositor,
the Transferor, DFS, the Servicer, the Owner Trustee, the Indenture Trustee or
any Affiliate thereof and no recourse may be had against such Persons or their
assets, except as may be expressly set forth or contemplated in this Agreement
or the Basic Documents.
SECTION 11.11. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 11.12. GOVERNING LAW. THIS AGREEMENT 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 SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.13. Benefit Plan. The Residual Interestholder represents and
warrants that it is not a Benefit Plan. "Benefit Plan" means (i) an employee
benefit plan (as defined in Section 3(3) of ERISA) that is subject to the
provisions of Title I 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.
24
<PAGE>
SECTION 11.14. Submission to Jurisdiction. Each of the parties
hereto hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any other Basic Document or
for recognition and enforcement of any judgment in respect thereof, to
the non-exclusive general jurisdiction of the courts of the State of
New York, the courts of the United States of America for the Southern
District of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter
have to the venue of such action or proceeding in any such court or
that such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to such Person at its address set forth in Section 11.04 or at
such other address notified to the other party to this Agreement
pursuant thereto; and
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall
limit the right to sue in any other jurisdiction.
[SIGNATURES FOLLOW]
25
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Trust Agreement to be duly executed by their respective officers
hereunto duly authorized, as of the day and year first above written.
DEUTSCHE RECREATIONAL ASSET FUNDING
CORPORATION, as Depositor
By: /s/ Richard C. Goldman
---------------------------------------
Name: Richard C. Goldman
Title: Vice President
By: /s/ Richard H. Schumacher
---------------------------------------
Name: Richard H. Schumacher
Title: Vice President
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, not in its individual capacity but
solely as Owner Trustee
By: /s/ Marianna C. Stershic
---------------------------------------
Name: Marianna C. Stershic
Title: Assistant Vice President
S-1
<PAGE>
Exhibit 4.3
INDENTURE
between
DISTRIBUTION FINANCIAL SERVICES RV TRUST 1999-1,
as Issuer
and
THE CHASE MANHATTAN BANK,
as Indenture Trustee
Dated as of March 1, 1999
<PAGE>
TABLE OF CONTENTS
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01 Definitions..................................................2
SECTION 1.02 Incorporation by Reference of Trust Indenture Act............2
SECTION 1.03 Rules of Construction........................................2
ARTICLE II
The Notes
SECTION 2.01 Form.........................................................3
SECTION 2.02 Execution, Authentication and Delivery.......................3
SECTION 2.03 Temporary Notes..............................................4
SECTION 2.04 Registration; Registration of Transfer and Exchange..........4
SECTION 2.05 Mutilated, Destroyed, Lost or Stolen Notes...................6
SECTION 2.06 Persons Deemed Owner.........................................6
SECTION 2.07 Payment of Principal and Interest; Defaulted Interest........7
SECTION 2.08 Cancellation.................................................8
SECTION 2.09 Reserved.....................................................8
SECTION 2.10 Book-Entry Notes.............................................8
SECTION 2.11 Notices to Clearing Agency...................................9
SECTION 2.12 Definitive Notes.............................................9
SECTION 2.13 Tax Treatment...............................................10
ARTICLE III
Covenants
SECTION 3.01 Payment of Principal and Interest...........................10
SECTION 3.02 Maintenance of Office or Agency.............................10
SECTION 3.03 Money for Payments To Be Held in Trust......................10
SECTION 3.04 Existence...................................................12
SECTION 3.05 Protection of Trust Estate..................................12
SECTION 3.06 Opinions as to Trust Estate.................................13
SECTION 3.07 Performance of Obligations; Servicing of Receivables........13
SECTION 3.08 Negative Covenants..........................................15
SECTION 3.09 Annual Statement as to Compliance...........................15
SECTION 3.10 Issuer May Consolidate, etc., Only on Certain Terms.........16
SECTION 3.11 Successor or Transferee.....................................17
SECTION 3.12 No Other Business...........................................18
SECTION 3.13 No Borrowing................................................18
SECTION 3.14 Servicer's Obligations......................................18
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SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities...........18
SECTION 3.16 Capital Expenditures........................................18
SECTION 3.17 (Reserved)..................................................18
SECTION 3.18 Restricted Payments.........................................18
SECTION 3.19 Notice of Events of Default.................................18
SECTION 3.20 Further Instruments and Acts................................19
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01 Satisfaction and Discharge of Indenture.....................19
SECTION 4.02 Application of Trust Money..................................20
SECTION 4.03 Repayment of Moneys Held by Paying Agent....................20
ARTICLE V
Remedies
SECTION 5.01 Events of Default...........................................20
SECTION 5.02 Acceleration of Maturity; Rescission and Annulment..........22
SECTION 5.03 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee...........................................22
SECTION 5.04 Remedies; Priorities........................................24
SECTION 5.05 Optional Preservation of the Receivables....................26
SECTION 5.06 Limitation of Suits.........................................26
SECTION 5.07 Unconditional Rights of Noteholders To Receive Principal
and Interest................................................27
SECTION 5.08 Restoration of Rights and Remedies..........................27
SECTION 5.09 Rights and Remedies Cumulative..............................27
SECTION 5.10 Delay or Omission Not a Waiver..............................28
SECTION 5.11 Control by Noteholders......................................28
SECTION 5.12 Waiver of Past Defaults.....................................28
SECTION 5.13 Undertaking for Costs.......................................29
SECTION 5.14 Waiver of Stay or Extension Laws............................29
SECTION 5.15 Action on Notes.............................................29
SECTION 5.16 Performance and Enforcement of Certain Obligations..........29
ARTICLE VI
The Indenture Trustee
SECTION 6.01 Duties of Indenture Trustee.................................31
SECTION 6.02 Rights of Indenture Trustee.................................32
SECTION 6.03 Individual Rights of Indenture Trustee......................33
SECTION 6.04 Indenture Trustee's Disclaimer..............................33
SECTION 6.05 Notice of Defaults..........................................33
SECTION 6.06 Reports by Indenture Trustee to Holders.....................33
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SECTION 6.07 Compensation and Indemnity..................................33
SECTION 6.08 Replacement of Indenture Trustee............................34
SECTION 6.09 Successor Indenture Trustee by Merger.......................35
SECTION 6.10 Appointment of CoIndenture Trustee or Separate Indenture
Trustee.....................................................35
SECTION 6.11 Eligibility; Disqualification...............................37
SECTION 6.12 Preferential Collection of Claims Against Issuer............37
SECTION 6.13 Representations and Warranties..............................37
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.01 Issuer To Furnish Indenture Trustee Names and Addresses of
Noteholders.................................................38
SECTION 7.02 Preservation of Information; Communications to Noteholders..38
SECTION 7.03 Reports by Issuer...........................................38
SECTION 7.04 Reports by Indenture Trustee................................39
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.01 Collection of Money.........................................39
SECTION 8.02 Trust Accounts..............................................39
SECTION 8.03 General Provisions Regarding Accounts.......................41
SECTION 8.04 Release of Trust Estate.....................................42
SECTION 8.05 Opinion of Counsel..........................................42
ARTICLE IX
Supplemental Indentures
SECTION 9.01 Supplemental Indentures Without Consent of Noteholders......43
SECTION 9.02 Supplemental Indentures with Consent of Noteholders.........44
SECTION 9.03 Execution of Supplemental Indentures........................46
SECTION 9.04 Effect of Supplemental Indenture............................46
SECTION 9.05 Conformity with Trust Indenture Act.........................46
SECTION 9.06 Reference in Notes to Supplemental Indentures...............46
ARTICLE X
Redemption of Notes
SECTION 10.01 Redemption.................................................46
SECTION 10.02 Form of Redemption Notice..................................47
SECTION 10.03 Notes Payable on Redemption Date...........................47
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ARTICLE XI
Miscellaneous
SECTION 11.01 Compliance Certificates and Opinions, etc..................47
SECTION 11.02 Form of Documents Delivered to Indenture Trustee...........49
SECTION 11.03 Acts of Noteholders........................................50
SECTION 11.04 Notices, etc., to Indenture Trustee, Issuer and
Rating Agencies............................................51
SECTION 11.05 Notices to Noteholders; Waiver.............................51
SECTION 11.06 Alternate Payment and Notice Provisions....................52
SECTION 11.07 Conflict with Trust Indenture Act..........................52
SECTION 11.08 Effect of Headings and Table of Contents...................52
SECTION 11.09 Successors and Assigns.....................................52
SECTION 11.10 Separability...............................................52
SECTION 11.11 Benefits of Indenture......................................52
SECTION 11.12 Legal Holidays.............................................52
SECTION 11.13 Governing Law..............................................53
SECTION 11.14 Counterparts...............................................53
SECTION 11.15 Recording of Indenture.....................................53
SECTION 11.16 Trust Obligation...........................................53
SECTION 11.17 No Petition................................................53
SECTION 11.18 No Prohibited Transaction..................................54
SECTION 11.19 Inspection.................................................54
SECTION 11.20 Submission to Jurisdiction.................................54
EXHIBIT A - Form of Note (Section 2.01)
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<PAGE>
CROSS REFERENCE TABLE(1)
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
(d).............................................................7.04
313 (a).............................................................7.04
(b) (1).........................................................7.04
(b) (2)...................................................7.04; 11.5
(c).............................................................7.04
(d).............................................................7.03
314 (a)............................................................11.01
(b)............................................................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).............................................................5.13
- --------
(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.
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<PAGE>
316 (a) (last sentence).............................................2.07
(a) (1) (A).....................................................5.11
(a) (1) (B).....................................................5.12
(a) (2).........................................................5.11
(b).............................................................5.07
(c).............................................................N.A.
317 (a) (1).........................................................5.03
(a) (2).........................................................5.03
(b).............................................................3.03
318 (a)............................................................11.07
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<PAGE>
INDENTURE dated as of March 1, 1999, between DISTRIBUTION FINANCIAL
SERVICES RV TRUST 1999-1, a New York common law trust (the "Issuer"), and THE
CHASE MANHATTAN BANK, a New York banking corporation, as trustee and not in its
individual capacity (the "Indenture 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 Class A-1 Asset
Backed Notes, Class A-2 Asset Backed Notes, Class A-3 Asset Backed Notes, Class
A-4 Asset Backed Notes, Class A-5 Asset Backed Notes, Class A-6 Asset Backed
Notes, Class B Asset Backed Notes and Class C Asset Backed Notes (together, the
"Notes"):
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the Closing Date,
as Indenture Trustee for the benefit of the Holders of the Notes, all of the
Issuer's right, title and interest in, to and under: (a) the Receivables and all
moneys received thereon on and after the Cutoff Date; (b) the security interests
in the Financed Vehicles created pursuant to the Receivables and any other
interest of the Issuer in such Financed Vehicles; (c) any proceeds with respect
to the Receivables under any Insurance Policies; (d) any proceeds from recourse
to Dealers; (e) any Financed Vehicle acquired in repossession; (f) the contents
of the Receivable Files and all rights, benefits and proceeds arising therefrom
or in connection therewith; (g) all funds on deposit from time to time in Trust
Accounts, and all investments and proceeds thereof (including all income
thereon); (h) the Transfer and Servicing Agreement; and (i) all present and
future claims, demands, causes of action 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 thereof, voluntary or involuntary, into cash or
other liquid property, all cash proceeds, accounts, accounts receivable, 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 (collectively, the "Collateral").
The foregoing Grant is made in trust to secure the payment of principal
of and interest on, and any other amounts owing in respect of, the Notes,
equally and ratably without prejudice, priority or distinction (subject to the
terms of this Indenture), and to secure compliance with the provisions of this
Indenture, all as provided in this Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the Holders of
the Notes, acknowledges such Grant and accepts the trusts under this Indenture
in accordance with the provisions of this Indenture.
<PAGE>
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01 Definitions. Except as otherwise specified herein or as
the context may otherwise require, capitalized terms used herein have the
respective meanings set forth in Appendix A to the Transfer and Servicing
Agreement, dated the same date as this Indenture, among Distribution Financial
Services RV Trust 1999-1 (the "Issuer"), Deutsche Recreational Asset Funding
Corporation (the "Depositor"), and Deutsche Financial Services Corporation, as
the Servicer.
SECTION 1.02 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture
Trustee.
"obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule have
the meaning assigned to them by such definitions.
SECTION 1.03 Rules of Construction. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;
(iii) "or" is not exclusive;
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(iv) "including" means including without limitation;
(v) words in the singular include the plural and words in the
plural include the singular; and
(vi) any agreement (including the Transfer and Servicing
Agreement referred to above), instrument or statute defined or referred
to herein or in any instrument or certificate delivered in connection
herewith means such agreement, instrument or statute as from time to
time amended, amended and restated, or otherwise modified and includes
(in the case of agreements or instruments) references to all
attachments thereto and instruments incorporated therein; references to
a Person are also to its permitted successors and assigns.
ARTICLE II
The Notes
SECTION 2.01 Form. The Notes, together with the Indenture Trustee's
certificate of authentication, shall be in substantially the form set forth in
Exhibit A, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
officers executing such Notes, as evidenced by their execution of the Notes. Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.
The definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the officers executing such Notes, as
evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication. The terms of
the Notes set forth in Exhibit A 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 Indenture Trustee shall upon Issuer Order authenticate and deliver
Class A-1 Notes for original issue in an aggregate principal amount of
$112,743,000, Class A-2 Notes for original issue in an
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<PAGE>
aggregate principal amount of $227,529,000, Class A-3 Notes for original issue
in an aggregate principal amount of $197,998,000, Class A-4 Notes for original
issue in an aggregate principal amount of $192,642,000, Class A-5 Notes for
original issue in an aggregate principal amount of $159,722,000, Class A-6 Notes
for original issue in an aggregate principal amount of $64,366,000, Class B
Notes for original issue in an aggregate principal amount of $25,000,000, and
Class C Notes for original issue in an aggregate principal amount of
$20,000,000. The aggregate principal amount of Class A-1 Notes, Class A-2 Notes,
Class A-3 Notes, Class A-4 Notes, Class A-5 Notes, Class A-6 Notes, Class B
Notes and Class C 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 $1,000 and
in integral multiples thereof.
No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized officers, 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 Indenture
Trustee shall authenticate and deliver, temporary Notes that are printed,
lithographed, typewritten, mimeographed or otherwise produced, of the tenor of
the definitive Notes in lieu of which they are issued and with such variations
not inconsistent with the terms of this Indenture as the officers executing such
Notes may determine, as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuer shall cause definitive Notes
to be prepared without unreasonable delay. After the preparation of definitive
Notes, the temporary Notes shall be exchangeable for definitive Notes upon
surrender of the temporary Notes at the office or agency of the Issuer to be
maintained as provided in Section 3.02, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Notes, the Issuer shall
execute, and the Indenture Trustee shall authenticate and deliver in exchange
therefor, a like principal amount of definitive Notes of authorized
denominations and of the same Class. Until so exchanged, the temporary Notes
shall in all respects be entitled to the same benefits under this Indenture as
definitive Notes.
SECTION 2.04 Registration; Registration of Transfer and Exchange. The
Issuer shall cause to be kept a register (the "Note Register") in which, subject
to such reasonable regulations as it may prescribe, the Issuer shall provide for
the registration of Notes and the registration of transfers of Notes. The
Indenture Trustee initially shall be the "Note Registrar" for the purpose of
registering Notes and transfers of Notes as herein provided. Upon any
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note
Registrar and shall promptly notify the Noteholders of such appointment or
assumption.
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If a Person other than the Indenture Trustee is appointed by the Issuer
as Note Registrar, the Issuer shall give the Indenture Trustee prompt written
notice of the appointment of such Note Registrar and of the location, and any
change in the location, of the Note Register, and the Indenture Trustee shall
have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate executed on behalf of the Note Registrar by an Executive
Officer thereof as to the names and addresses of the Holders of the Notes and
the principal amounts and number of such Notes.
Upon surrender for registration of transfer of any Note at the office
or agency of the Issuer to be maintained as provided in Section 3.02, the Issuer
shall execute, and the Indenture Trustee shall authenticate and the Noteholder
shall obtain from the Indenture Trustee, in the name of the designated
transferee or transferees, one or more new Notes of the same Class in any
authorized denominations, of a like aggregate principal amount.
At the option of the Holder, Notes may be exchanged for other Notes of
the same Class in any authorized denominations, of a like aggregate principal
amount, upon surrender of the Notes to be exchanged at such office or agency.
Whenever any Notes are so surrendered for exchange, the Issuer shall
execute, and the Indenture Trustee shall authenticate and the Noteholder shall
obtain from the Indenture Trustee, the Notes which the Noteholder making the
exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Issuer, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed by, or be accompanied by a written instrument of
transfer in form satisfactory to the Indenture Trustee duly executed by, the
Holder thereof or such Holder's attorney duly authorized in writing, with such
signature guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements may include membership or
participation in the Securities Transfer Agent's Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Note
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Exchange Act.
No service charge shall be made to a Holder for any registration of
transfer or exchange of Notes, but the Issuer 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 Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by it to hold the Issuer and the Indenture Trustee
harmless, then, in the absence of notice to the Issuer, the Note Registrar or
the Indenture Trustee that such Note has been acquired by a bona fide purchaser,
the Issuer shall execute, and upon its request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note of the same Class; provided,
however, that if any such destroyed, lost or stolen Note, but not a mutilated
Note, shall have become or within seven days shall be due and payable, or shall
have been called for redemption, instead of issuing a replacement Note, the
Issuer may pay such destroyed, lost or stolen Note when so due or payable or
upon the Redemption Date without surrender thereof. If, after the delivery of
such replacement Note or payment of a destroyed, lost or stolen Note pursuant to
the proviso to the preceding sentence, a bona fide purchaser of the original
Note in lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer and the Indenture Trustee shall be entitled to recover
such replacement Note (or such payment) from the Person to whom it was delivered
or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or indemnity
provided therefor to the extent of any loss, damage, cost or expense incurred by
the Issuer or the Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the
Issuer may require the payment by the Holder of such Note of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) 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 Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in whose name
any Note is registered (as of the day of determination except as provided in
Section 2.07) as the owner of such Note for the purpose of receiving payments of
principal of and interest, if any, on such Note and for all other purposes
whatsoever, whether or not such Note be overdue, and none of the Issuer, the
Indenture Trustee or any agent of the Issuer or the Indenture Trustee shall be
affected by notice to the contrary.
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SECTION 2.07 Payment of Principal and Interest; Defaulted Interest.
(a) The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the
Class A-4 Notes, the Class A-5 Notes, the Class A-6 Notes, the Class B Notes and
the Class C Notes shall accrue interest at the Class A-1 Interest Rate, the
Class A-2 Interest Rate, the Class A-3 Interest Rate, the Class A-4 Interest
Rate, the Class A-5 Interest Rate, the Class A-6 Interest Rate, the Class B
Interest Rate and the Class C Interest Rate, respectively, and such interest
shall be due and payable on each Monthly Payment Date. Any installment of
interest or principal payable on a Note that is punctually paid or duly provided
for by the Issuer on the applicable Monthly Payment Date shall be paid to the
Person in whose name such Note (or one or more Predecessor Notes) is registered
at the close of business 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 2.12, with respect to Notes registered at the close of business on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
nominee shall be Cede & Co.), payment shall be made by wire transfer in
immediately available funds to the account designated by such nominee, except
for the final installment of principal payable with respect to such Note on a
Monthly Payment Date or on the applicable class Stated Maturity Date (and except
for the Redemption Price for any Note called for redemption pursuant to Section
10.01) which shall be payable as provided below. The funds represented by any
such checks returned undelivered shall be held in accordance with Section 3.03.
(b) The principal of each Note shall be payable in installments on each
Monthly Payment Date; provided, however, that the entire unpaid principal amount
of each Note shall be due and payable on the applicable class Stated Maturity
Date. Notwithstanding the foregoing, the entire unpaid principal amount of the
Notes shall be due and payable, if not previously paid, if an Event of Default
shall have occurred and be continuing and if the Indenture Trustee or the
Majority Noteholders have declared the Notes to be immediately due and payable
in the manner provided in Section 5.02. All principal and interest payments on
each Class of Notes shall be made pro rata to the Noteholders of such Class
entitled thereto. The Indenture Trustee shall notify the Person in whose name a
Note is registered at the close of business on the Record Date preceding the
Monthly Payment Date on which the Issuer expects that the final installment of
principal of and interest on such Note shall be paid if the Issuer or the
Servicer has notified the Indenture Trustee of such expectation at least five
Business Days prior to such Record Date. Such notice shall be mailed or
transmitted by facsimile prior to such final Monthly Payment Date and shall
specify that such final installment shall be payable to the Holder of record as
of the applicable Record Date 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.
(c) If any interest payable on any Class of Notes is not paid on any
Monthly Payment Date, interest on such unpaid interest shall accrue at the
applicable Interest Rate, and to the extent unpaid shall be due and payable on
succeeding Monthly Payment Dates, to the extent permitted by law.
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(d) A Noteholder's portion of the aggregate outstanding principal
balance of the related Class of Notes is the product of (i) the original
denomination of such Noteholder's Notes and (ii) the applicable Note Pool
Factor.
SECTION 2.08 Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever, and all Notes so delivered shall be promptly cancelled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes cancelled as provided in this Section, except as expressly permitted
by this Indenture. All cancelled Notes may be held or disposed of by the
Indenture Trustee in accordance with its standard retention or disposal policy
as in effect at the time unless the Issuer shall direct by an Issuer Order that
they be destroyed or returned to it; provided, that such Issuer Order is timely
and the Notes have not been previously disposed of by the Indenture Trustee.
SECTION 2.09 Reserved.
SECTION 2.10 Book-Entry Notes. The Notes, upon original issuance, shall
be issued in the form of typewritten Notes representing the Book-Entry Notes, to
be delivered to The Depository Trust Company, the initial Clearing Agency, by,
or on behalf of, the Issuer. The Book-Entry Notes shall be registered initially
on the Note Register in the name of Cede & Co., the nominee of the initial
Clearing Agency, and no Note Owner thereof shall receive a definitive Note
representing such Note Owner's interest in such Note, except as provided in
Section 2.12. Unless and until definitive, fully registered Notes (the
"Definitive Notes") have been issued to such Note Owners pursuant to Section
2.12:
(i) the provisions of this Section shall be in full force
and effect;
(ii) the Note Registrar and the Indenture Trustee shall be
entitled to deal with the Clearing Agency for all
purposes of this Indenture (including the payment of
principal of and interest on the Notes and the giving
of instructions or directions hereunder) as the sole
holder of the Notes, and shall have no obligation to
the Note Owners;
(iii) to the extent that the provisions of this Section
conflict with any other provisions of this Indenture,
the provisions of this Section shall control;
(iv) the rights of Note Owners shall be exercised only
through the Clearing Agency and shall be limited to
those established by law and agreements between such
Note Owners and the Clearing Agency and/or the
Clearing Agency Participants pursuant to the Note
Depository Agreement. Unless and until Definitive
Notes are issued pursuant to Section 2.12, the
initial Clearing Agency shall make book-entry
transfers among the Clearing Agency
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Participants and receive and transmit payments of
principal of and interest on the Notes to such
Clearing Agency Participants; and
(v) whenever this Indenture requires or permits actions
to be taken based upon instructions or directions of
Holders of Notes evidencing a specified percentage of
the Outstanding Amount of the Notes, the Clearing
Agency shall be deemed to represent such percentage
only to the extent that it has received instructions
to such effect from Note Owners and/or Clearing
Agency Participants owning or representing,
respectively, such required percentage of the
beneficial interest in the Notes and has delivered
such instructions to the Indenture Trustee.
SECTION 2.11 Notices to Clearing Agency. Whenever a notice or other
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to such Note Owners pursuant to
Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Holders of the Notes to the
Clearing Agency, and shall have no obligation to such Note Owners.
SECTION 2.12 Definitive Notes. If (i) the Depositor advises the
Indenture Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities with respect to the Book-Entry
Notes and the Depositor is unable to locate a qualified successor within 90 days
of the giving of such advice, (ii) the Depositor at its option advises the
Indenture Trustee in writing that it elects to terminate the book-entry system
through the Clearing Agency or (iii) after the occurrence of an Event of Default
or a Servicer Default, Note Owners of the Book-Entry Notes representing
beneficial interests aggregating at least a majority of the Outstanding Amount
of such Notes advise the Clearing Agency in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interests
of such Note Owners, then the Clearing Agency shall notify all Note Owners and
the Indenture 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 Indenture Trustee of the typewritten Notes representing the
Book-Entry Notes by the Clearing Agency, accompanied by registration
instructions, the Issuer shall execute and the Indenture Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the Indenture Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Notes, the Indenture Trustee shall recognize the
Holders of the Definitive Notes as Noteholders.
SECTION 2.13 Tax Treatment. The Issuer has entered into this Indenture,
and the Notes shall be issued, with the intention that, for all purposes
including federal, state and local income, single business and franchise tax
purposes, the Notes shall qualify as indebtedness of the Issuer secured by the
Trust Estate. The Issuer, by entering into this Indenture, and each Noteholder,
by its acceptance of a Note (and each Note Owner by its acceptance of an
interest in the applicable Book-Entry Note), agree to treat the Notes for all
purposes, including federal, state and local income, single business and
franchise tax purposes, as indebtedness of the Issuer.
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ARTICLE III
Covenants
SECTION 3.01 Payment of Principal and Interest. The Issuer shall duly
and punctually pay the principal of and interest, if any, on the Notes in
accordance with the terms of the Notes and this Indenture. Without limiting the
foregoing, subject to Section 8.02(c), the Issuer shall cause to be distributed
all amounts on deposit in the Note Distribution Account on a Monthly Payment
Date deposited therein pursuant to the Transfer and Servicing Agreement (i) for
the benefit of the Class A-1 Notes, to the Class A-1 Noteholders, (ii) for the
benefit of the Class A-2 Notes, to the Class A-2 Noteholders, (iii) for the
benefit of the Class A-3 Notes, to the Class A-3 Noteholders, (iv) for the
benefit of the Class A-4 Notes, to the Class A-4 Noteholders, (v) for the
benefit of the Class A-5 Notes, to the Class A-5 Noteholders, (vi) for the
benefit of the Class A-6 Notes, to the Class A-6 Noteholders, (vii) for the
benefit of the Class B Notes, to the Class B Noteholders and (viii) for the
benefit of the Class C Notes, to the Class C Noteholders. Amounts properly
withheld under the Code by any Person from a payment to any Noteholder of
interest and/or principal shall be considered as having been paid by the Issuer
to such Noteholder for all purposes of this Indenture.
SECTION 3.02 Maintenance of Office or Agency. The Issuer shall maintain
in the Borough of Manhattan, The City of New York, an office or agency where
Notes may be surrendered for registration of transfer or exchange, and where
notices and demands to or upon the Issuer in respect of the Notes and this
Indenture may be served. The Issuer hereby initially appoints the Indenture
Trustee to serve as its agent for the foregoing purposes. The Issuer shall give
prompt written notice to the Indenture Trustee of the location, and of any
change in the location, of any such office or agency. If at any time the Issuer
shall fail to maintain any such office or agency or shall fail to furnish the
Indenture Trustee with the address thereof, such surrenders, notices and demands
may be made or served at the Corporate Trust Office, and the Issuer hereby
appoints the Indenture Trustee as its agent to receive all such surrenders,
notices and demands.
SECTION 3.03 Money for Payments To Be Held in Trust. All payments of
amounts due and payable with respect to any Notes that are to be made from
amounts withdrawn from the Collection Account and the Note Distribution Account
pursuant to Section 8.02 shall be made on behalf of the Issuer by the Indenture
Trustee or by another Paying Agent, and no amounts so withdrawn from the
Collection Account and the Note Distribution Account for payments of Notes shall
be paid over to the Issuer except as provided in this Section.
On each Monthly 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 under the Notes, such sum to
be held in trust for the benefit of the Persons entitled thereto, and (unless
the Paying Agent is the Indenture Trustee) shall promptly notify the Indenture
Trustee of its action or failure so to act.
The Issuer shall cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee an instrument in which
such Paying Agent shall agree with the
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Indenture Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby
so agrees), subject to the provisions of this Section, that such Paying Agent
shall:
(i) hold all sums held by it for the payment of amounts
due with respect to the Notes in trust for the
benefit of the Persons entitled thereto until such
sums shall be paid to such Persons or otherwise
disposed of as herein provided and pay such sums to
such Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by
the Issuer (or any other obligor upon the Notes) of
which it has actual knowledge in the making of any
payment required to be made with respect to the
Notes;
(iii) at any time during the continuance of any such
default, upon the written request of the Indenture
Trustee, forthwith pay to the Indenture Trustee all
sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith
pay to the Indenture Trustee all sums held by it in
trust for the payment of Notes if at any time it
ceases to meet the standards required hereby to be
met by a Paying Agent at the time of its appointment;
and
(v) comply with all requirements of the Code with respect
to the withholding from any payments made by it on
any Notes of any applicable withholding taxes imposed
thereon and with respect to any applicable reporting
requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds, any money
held by the Indenture Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Note and remaining unclaimed for two years
after such amount has become due and payable shall be discharged from such trust
and be paid to the Issuer on Issuer Request; and the Holder of such Note shall
thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided, however, that the Indenture
Trustee or such Paying Agent, before being required to make any such repayment,
shall at the expense and direction of the Issuer cause to be published once, in
a newspaper published in the English language, customarily published on each
Business Day and of general circulation in The City of New York, notice that
such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such publication, any unclaimed
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balance of such money then remaining shall be repaid to the Issuer. The
Indenture Trustee shall also adopt and employ, at the expense and direction 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 Indenture Trustee or of any Paying Agent,
at the last address of record for each such Holder).
SECTION 3.04 Existence. The Issuer shall 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 shall keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and shall 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 Collateral and each other
instrument or agreement included in the Trust Estate.
SECTION 3.05 Protection of Trust Estate. The Issuer shall 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, and shall take such other action necessary or advisable
to:
(i) maintain or preserve the lien and security interest
(and the priority thereof) of this Indenture or carry
out more effectively the purposes hereof;
(ii) perfect, publish notice of or protect the validity of
any Grant made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
(iv) preserve and defend title to the Trust Estate and the
rights of the Indenture Trustee and the Noteholders
in such Trust Estate against the claims of all
persons and parties.
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument prepared by the Issuer required to be executed pursuant to this
Section 3.05.
SECTION 3.06 Opinions as to Trust Estate. (a) On the Closing Date, the
Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either
stating that, in the opinion of such counsel, such action has been taken with
respect to the recording and filing of this Indenture, any indentures
supplemental hereto, and any other requisite documents, and with respect to the
execution and filing of any financing statements and continuation statements, as
are necessary to perfect and make effective the lien and security interest of
this Indenture and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to make such lien and
security interest effective.
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(b) On or before March 15, in each calendar year, beginning in 2000,
the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either
stating that, in the opinion of such counsel, such action has been taken with
respect to the recording, filing, re-recording and refiling of this Indenture,
any indentures supplemental hereto and any other requisite documents and with
respect to the execution and filing of any financing statements and continuation
statements as is necessary to maintain the lien 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 shall, in the opinion of
such counsel, be required to maintain the lien and security interest of this
Indenture until March 15 in the following calendar year.
SECTION 3.07 Performance of Obligations; Servicing of Receivables.
(a) The Issuer shall not take any action and shall 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.
(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 Indenture 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.
(c) The Issuer shall punctually perform and observe all of its
obligations and agreements contained in this Indenture, the other Basic
Documents and in the instruments and agreements included in the 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.
(d) If the Issuer shall have knowledge of the occurrence of a Servicer
Default under the Transfer and Servicing Agreement, the Issuer shall promptly
notify the Indenture Trustee and the Rating Agencies thereof, and shall specify
in such notice the action, if any, the Issuer is taking with respect to such
default. If a Servicer Default shall arise from the failure of the Servicer to
perform any of its duties or obligations under the Transfer and Servicing
Agreement with respect to the Receivables, the Issuer shall take all reasonable
steps available to it to remedy such failure.
(e) As promptly as possible after notice of termination of the
Servicer's rights and powers has been given to the Servicer pursuant to Section
8.01 of the Transfer and Servicing
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Agreement, the Indenture Trustee shall appoint a successor servicer (the
"Successor Servicer"), and such Successor Servicer shall accept its appointment
by a written assumption in a form acceptable to the Indenture Trustee. Any
Successor Servicer other than the Indenture Trustee shall (i) be an established
financial institution having a net worth of not less than $100,000,000 and whose
regular business includes the servicing of Contracts and (ii) enter into a
servicing agreement with the Issuer having substantially the same provisions as
the provisions of the Transfer and Servicing Agreement applicable to the
Servicer which is being replaced by such Successor Servicer. If the Indenture
Trustee shall succeed to the Servicer's duties as servicer of the Receivables as
provided herein and in the Transfer and Servicing Agreement, it shall do so in
its individual capacity and not in its capacity as Indenture Trustee and,
accordingly, the provisions of Article VI hereof shall be inapplicable to the
Indenture Trustee in its duties as the successor to the Servicer and in
connection with the Indenture Trustee's servicing of the Receivables. In case
the Indenture Trustee shall become successor to the Servicer under the Transfer
and Servicing Agreement, the Indenture Trustee shall be entitled to receive the
Servicing Fee in accordance with the Basic Documents (so long as it is acting as
Servicer) and shall also be entitled to appoint as Servicer any one of its
Affiliates, provided that it shall be fully liable for the actions and omissions
of such Affiliate in such capacity as Successor Servicer.
(f) (Reserved.)
(g) Without derogating from the absolute nature of the assignment
granted to the Indenture Trustee under this Indenture or the rights of the
Indenture Trustee hereunder, the Issuer agrees (i) that it shall not, without
the prior written consent of the Indenture Trustee or the Majority Noteholders,
amend, modify, waive, supplement, terminate or surrender, or agree to any
amendment, modification, supplement, termination, waiver or surrender of, the
terms of any Collateral (except to the extent otherwise provided in the Transfer
and Servicing Agreement) or the Basic Documents, or waive timely performance or
observance by any Person under the Basic Documents; and (ii) that any such
amendment, modification, waiver, supplement, termination or surrender shall not
(A) increase or reduce in any manner the amount of, or accelerate or delay the
timing of, distributions that are required to be made for the benefit of the
Noteholders or (B) reduce the aforesaid percentage of the Notes that is required
to consent to any such amendment, without the consent of the Holders of all the
Outstanding Notes. If any such amendment, modification, waiver, supplement,
termination or surrender shall be so consented to by the Indenture Trustee or
such Holders, the Issuer agrees, promptly following a request by the Indenture
Trustee to do so, to execute and deliver, in its own name and at its own
expense, such agreements, instruments, consents and other documents as the
Indenture Trustee may deem necessary or appropriate in the circumstances.
SECTION 3.08 Negative Covenants. So long as any Notes are Outstanding,
the Issuer shall not:
(i) except as expressly permitted by this Indenture or
any other Basic Document sell, transfer, exchange or
otherwise dispose of any of the properties or assets
of the Issuer, including those included in the Trust
Estate, unless directed to do so by the Indenture
Trustee, or dissolve or liquidate in whole or in
part;
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(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the
Notes (other than amounts properly withheld from such
payments under the Code or applicable state law) or
assert any claim against any present or former
Noteholder by reason of the payment of the taxes
levied or assessed upon the Issuer or any part of the
Trust Estate; or
(iii) (A) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien of this
Indenture to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be
released from any covenants or obligations with
respect to the Notes under this Indenture except as
may be expressly permitted hereby, (B) permit any
lien, charge, excise, claim, security interest,
mortgage or other encumbrance (other than the lien of
this Indenture) to be created on or extend to or
otherwise arise upon or burden the 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 any of the Financed Vehicles and
arising solely as a result of an action or omission
of the related Obligor) or (C) permit the lien of
this Indenture not to constitute a valid first
priority (other than with respect to any such tax,
mechanics' or other lien) security interest in the
Trust Estate.
SECTION 3.09 Annual Statement as to Compliance. The Issuer shall
deliver to the Indenture Trustee, on or before March 15 of each year beginning
in 2000, 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 its 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 its compliance with any such condition or
covenant, specifying each such default known to such
Authorized Officer and the nature and status thereof.
SECTION 3.10 Issuer May Consolidate, etc., Only on Certain Terms.
(a) The Issuer shall not consolidate or merge with or into any other
Person, unless:
(i) the Person (if other than the Issuer) formed by or
surviving such consolidation or merger shall be a
Person organized and existing under the laws of the
United States of America or any State or the District
of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered
to the Indenture Trustee, in form satisfactory to the
Indenture
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Trustee, the due and punctual payment of the
principal of and interest on all Notes and the
performance or observance of every agreement and
covenant of this Indenture on the part of the Issuer
to be performed or observed, all as provided herein;
(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
(and shall have delivered copies thereof to the
Indenture Trustee) to the effect that such
transaction shall not have any material adverse tax
consequence to the Issuer, any Noteholder or the
Residual Interestholder;
(v) any action that is necessary to maintain the lien and
security interest created by this Indenture shall
have been taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of
Counsel 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 complied with (including any filing required by
the Exchange Act).
(b) Except as otherwise expressly contemplated by the Transfer and
Servicing Agreement, the Issuer shall not convey or transfer any of its
properties or assets, including those included in the Trust Estate, to any
Person, unless:
(i) the Person that acquires by conveyance or transfer
the properties and assets of the Issuer the
conveyance or transfer of which is hereby restricted
(A) shall 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
assumes, by an indenture supplemental hereto,
executed and delivered to the Indenture Trustee, in
form satisfactory to the Indenture Trustee, the due
and punctual payment of the principal of and interest
on all Notes and the performance or observance of
every agreement and covenant of this Indenture on the
part of the Issuer to be performed or observed, all
as provided herein, (C) expressly agrees 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 agrees 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 agrees
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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
(and shall have delivered copies thereof to the
Indenture Trustee) to the effect that such
transaction shall not have any material adverse tax
consequence to the Issuer, any Noteholder or the
Residual Interestholder;
(v) any action that is necessary to maintain the lien and
security interest created by this Indenture shall
have been taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of
Counsel 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).
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 the assets and properties of the
Issuer including the Trust Estate pursuant to Section 3.10(b), (i) the Person
acquiring such assets and properties 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 and (ii)
Distribution Financial Services RV Trust 1999-1 shall be released from every
covenant and agreement of this Indenture to be observed or performed on the part
of the Issuer with respect to the Notes immediately upon the delivery of written
notice to the Indenture Trustee stating that Distribution Financial Services RV
Trust 1999-1 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
Receivables in the manner contemplated by this Indenture and the other Basic
Documents and activities incidental thereto.
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SECTION 3.13 No Borrowing. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness other than as contemplated by this Indenture and the other Basic
Documents.
SECTION 3.14 Servicer's Obligations. The Issuer shall cause the
Servicer to comply with Sections 4.09, 4.10, 4.11 and Article IX of the Transfer
and Servicing Agreement.
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 of credit to, or guarantee (directly
or indirectly or by an instrument having the effect of assuring 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 contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person.
SECTION 3.16 Capital Expenditures. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
SECTION 3.17 (Reserved).
SECTION 3.18 Restricted Payments. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuer or otherwise with respect to any ownership or equity interest or security
in or of the Issuer or to the Servicer, (ii) redeem, purchase, retire or
otherwise acquire for value any such ownership or equity interest or security or
(iii) set aside or otherwise segregate any amounts for any such purpose;
provided, however, that the Issuer may make, or cause to be made, distributions
as contemplated by, and to the extent funds are available for such purpose
under, this Indenture, the Transfer and Servicing Agreement or the Trust
Agreement. The Issuer shall not, directly or indirectly, make payments to or
distributions from the Collection Account except in accordance with this
Indenture and the other Basic Documents.
SECTION 3.19 Notice of Events of Default. In addition to its
obligations under the last paragraph of Section 5.01, the Issuer shall give the
Indenture Trustee and the Rating Agencies written notice of each Event of
Default hereunder and each default on the part of the Servicer, DFS, the
Transferor or the Depositor of its obligations under the Transfer and Servicing
Agreement, in each case promptly after becoming aware of such Event of Default
or default.
SECTION 3.20 Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer shall 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.
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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 thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.05, 3.08,
3.10, 3.12 and 3.13, (v) the rights, obligations and immunities of the Indenture
Trustee hereunder (including the rights of the Indenture Trustee under Section
6.07 and the obligations of the Indenture Trustee under Section 4.02) and (vi)
the rights of Noteholders as beneficiaries hereof with respect to the property
so deposited with the Indenture Trustee payable to all or any of them, and the
Indenture Trustee, on demand of and at the expense of the Issuer, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture
with respect to the Notes, when
(A) either
(1) all Notes theretofore authenticated and delivered (other
than (i) Notes that have been destroyed, lost or stolen and
that have been replaced or paid as provided in Section 2.05
and (ii) Notes for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the
Issuer and thereafter repaid to the Issuer or discharged from
such trust, as provided in Section 3.03) have been delivered
to the Indenture Trustee for cancellation; or
(2) all such Notes not theretofore delivered to the Indenture
Trustee for cancellation
a. have become due and payable,
b. shall become due and payable at the applicable Stated
Maturity Date within one year, or
c. are to be called for redemption within one year under
arrangements satisfactory to the Indenture Trustee for the
giving of notice of redemption by the Indenture Trustee in
the name, and at the expense, of the Issuer,
and the Issuer, in the case of a., b, or c, above, has irrevocably
deposited or caused to be irrevocably deposited with the Indenture
Trustee cash or direct obligations of or obligations guaranteed by the
United States of America (which shall mature prior to the date such
amounts are payable), in trust for such purpose, in an amount
sufficient to pay and discharge the entire indebtedness on such Notes
not theretofore delivered to the Indenture Trustee for cancellation
when due to the applicable Stated Maturity Date or Redemption Date (if
Notes shall have been called for redemption pursuant to Section 10.01),
as the case may be;
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(B) the Issuer has paid or caused to be paid all other sums payable
hereunder by the Issuer; and
(C) the Issuer has delivered to the Indenture Trustee an Officer's
Certificate, an Opinion of Counsel and (if required by the TIA or
the Indenture Trustee) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable
requirements of Section 11.01(a) and, subject to Section 11.02,
each stating that all conditions precedent herein provided for
relating to the satisfaction and discharge of this Indenture have
been complied with.
SECTION 4.02 Application of Trust Money. All moneys deposited with the
Indenture Trustee pursuant to Section 4.01 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Holders of the particular Notes for the
payment or redemption of which such moneys have been deposited with the
Indenture 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 Indenture Trustee under
the provisions of this Indenture with respect to such Notes shall, upon demand
of the Issuer, be paid to the Indenture Trustee to be held and applied according
to Section 3.03 and thereupon such Paying Agent shall be released from all
further liability with respect to such moneys.
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 any portion of the unpaid
principal balance of any Class of Notes on the Stated
Maturity Date of such Class of Notes; or
(iii) default in the observance or performance of any covenant or
agreement of the Issuer made in this Indenture (other than
a covenant or agreement, a default in the observance or
performance of which is elsewhere in this Section
specifically
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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
representation 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 Indenture Trustee (or
to the Issuer and the Indenture Trustee by the Holders of
Notes representing 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 filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the
Issuer or any substantial part of the Trust Estate in an
involuntary case under any applicable federal or state
bankruptcy, insolvency or other similar law now or
hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar
official of the Issuer or for any substantial part of the
Trust Estate, or ordering the winding-up or liquidation of
the Issuer's affairs, and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days;
or
(v) the commencement by the Issuer of a voluntary case under
any applicable federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or the
consent by the Issuer to the entry of an order for relief
in an involuntary case under any such law, or the consent
by the Issuer to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any
substantial part of the Trust Estate, or the making by the
Issuer of any general assignment for the benefit of
creditors, or the failure by the Issuer generally to pay
its debts as such debts become due, or the taking of any
action by the Issuer in furtherance of any of the
foregoing.
The Issuer shall deliver to the Indenture Trustee, within five days
after 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), its status and what action
the Issuer is taking or proposes to take with respect thereto.
SECTION 5.02 Acceleration of Maturity; Rescission and Annulment. If an
Event of Default should occur and be continuing, then and in every such case the
Indenture Trustee or the Majority Noteholders may declare all of the Notes to be
immediately due and payable, by a notice in writing to the Issuer (and to the
Indenture Trustee if given by Noteholders), and upon any such declaration the
unpaid principal amount of the Notes, together with accrued and unpaid interest
thereon through the date of acceleration, shall become immediately due and
payable.
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At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Majority Noteholders by written notice to the Issuer and the Indenture Trustee,
may rescind and annul such declaration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture Trustee
a sum sufficient to pay:
(A) all payments of principal of and interest on all Notes
and all other amounts that would then be due hereunder
or upon such Notes if the Event of Default giving rise
to such acceleration had not occurred; and
(B) all sums paid or advanced by the Indenture Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and
its agents and counsel; and
(ii) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such
acceleration, have been cured or waived as provided in
Section 5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
SECTION 5.03 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.
(a) The Issuer covenants that if (i) default is made in the payment of
any interest on any Note when the same becomes due and payable, and such default
continues for a period of five days, or (ii) default is made in the payment of
the principal of or any installment of the principal of any Note when the same
becomes due and payable, the Issuer shall, upon demand of the Indenture Trustee,
pay to it, for the benefit of the Holders of the Notes, the whole amount then
due and payable on such Notes for principal and interest, with interest on the
overdue principal and, to the extent payment at such rate of interest shall be
legally enforceable, on overdue installments of interest at the rate borne by
the Notes and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Indenture Trustee and
its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such amounts upon
such demand, the Indenture Trustee, in its own name and as trustee of an express
trust, may institute a Proceeding for the collection of the sums so due and
unpaid, and may prosecute such Proceeding to judgment or final decree, and may
enforce the same against the Issuer or other obligor upon such Notes and collect
in the manner provided by law out of the property of the Issuer or other obligor
upon such Notes, wherever situated, the moneys adjudged or decreed to be
payable.
(c) If an Event of Default occurs and is continuing, the Indenture
Trustee may, as more particularly provided in Section 5.04, in its discretion,
proceed to protect and enforce its rights and
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the rights of the Noteholders, by such appropriate Proceedings as the Indenture
Trustee shall deem most effective to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy or legal or equitable right vested in the Indenture
Trustee by this Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest in
the 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 or trustee in bankruptcy or reorganization, or liquidator,
sequestrator or similar official, shall have been appointed for or taken
possession of the Issuer or its property or such other obligor or Person, or in
case of any other comparable judicial Proceedings relative to the Issuer or
other obligor upon the Notes or to the creditors or property of the Issuer or
such other obligor, the Indenture Trustee, irrespective of whether the principal
of any Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Indenture Trustee shall
have made any demand pursuant to the provisions of this Section, shall be
entitled and empowered, by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in
respect of the Notes and to file such other papers or
documents as may be necessary or advisable in order to
have the claims of the Indenture Trustee (including
any claim for reasonable compensation to the Indenture
Trustee and each predecessor Indenture Trustee, and
their respective agents, attorneys and counsel, and
for reimbursement of all expenses and liabilities
incurred, and all advances made, by the Indenture
Trustee and each predecessor Indenture Trustee, except
as a result of negligence or bad faith) and of the
Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law 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 Indenture Trustee
on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to
have the claims of the Indenture Trustee or the
Holders of Notes allowed in any Proceedings relative
to the Issuer, its creditors and its property;
and any trustee, receiver, liquidator, sequestrator or similar official in any
such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Indenture Trustee and, in the event that the Indenture Trustee
shall consent to the making of payments directly to such Noteholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation
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to the Indenture Trustee, each predecessor Indenture Trustee and their
respective agents, attorneys and counsel, and all other expenses and liabilities
incurred, and all advances made, by the Indenture Trustee and each predecessor
Indenture Trustee except as a result of negligence or bad faith.
(e) Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except as contemplated by clause (d)(ii)
above.
(f) All rights of action and of asserting claims under this Indenture,
or under any of the Notes, may be enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any trial or other
Proceedings relative thereto, and any such action or Proceedings instituted by
the Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
liabilities, disbursements and compensation of the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents and attorneys, shall
be for the ratable benefit of the Holders of the Notes.
(g) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Holders of the Notes, and it shall not be necessary to
make any Noteholder a party to any such Proceedings.
SECTION 5.04 Remedies; Priorities. (a) If an Event of Default shall
have occurred and be continuing, the Indenture Trustee may do one or more of the
following (subject to Section 5.05):
(i) institute Proceedings in its own name and as trustee
of an express trust for the collection of all amounts
then payable on the Notes or under this Indenture with
respect thereto, whether by declaration or otherwise,
enforce any judgment obtained and collect from the
Issuer 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 take any other appropriate action to protect and
enforce the rights and remedies of the Indenture
Trustee and the Holders of the Notes; 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 Indenture Trustee may not sell or otherwise
liquidate the Trust Estate following an Event of Default, other than an Event of
Default described in Section 5.01(i) or (ii),
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unless (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 are sufficient to discharge in full all amounts then due and unpaid
upon such Notes for principal and interest at the time of such sale or
liquidation or (C) the Indenture Trustee determines that the Trust Estate shall
not continue to provide sufficient funds for the payment of principal of and
interest on the Notes as they would have become due if the Notes had not been
declared due and payable, and the Indenture Trustee obtains the consent of
Holders of Notes representing at least 66 2/3% of the Outstanding Amount of the
Notes. In determining such sufficiency or insufficiency with respect to clause
(B) and (C), the Indenture Trustee may, but need not, obtain at the Issuer's
expense 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.
(b) If the Indenture Trustee collects any money or property pursuant to
this Article V, it shall pay out the money or property in the following order of
priority on each Monthly Payment Date:
FIRST: to the Indenture Trustee for amounts due under Section 6.07;
SECOND: to the Servicer (if DFS is no longer the Servicer), for due
and unpaid Servicing Fees or any other amounts due to it by the Issuer pursuant
to the Transfer and Servicing Agreement;
THIRD: to the Class A Noteholders for amounts due and unpaid on the
Class A Notes for interest, on a pro rata basis without preference or priority
of any kind (including without preference or priority among the different
Classes of Class A Notes), according to the amounts due and payable on the Class
A Notes for interest;
FOURTH: to the Class B Noteholders for amounts due and unpaid on the
Class B Notes for interest, on a pro rata basis, without preference or priority
of any kind, according to the amounts due and payable on the Class B Notes for
interest;
FIFTH: to the Class C Noteholders for amounts due and unpaid on the
Class C Notes for interest, on a pro rata basis, without preference or priority
of any kind, according to the amounts due and payable on the Class C Notes for
interest.
SIXTH: to the Class A Noteholders for amounts due and unpaid on the
Class A Notes for principal, on a pro rata basis, without preference or priority
of any kind (including without preference or priority among the different
Classes of Class A Notes), until the Outstanding Amount of each Class of the
Class A Notes is reduced to zero;
SEVENTH: to the Class B Noteholders for amounts due and unpaid on the
Class B Notes for principal, on a pro rata basis, without preference or priority
of any kind, until the Outstanding Amount of the Class B Notes is reduced to
zero;
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EIGHTH: to the Class C Noteholders, for amounts due and unpaid on the
Class C Notes for principal, on a pro rata basis, without preference or priority
of any kind, until the Outstanding Amount of the Class C Notes is reduced to
zero;
NINTH: if DFS is the Servicer, for due and unpaid Servicing Fees or any
other amounts due to it by the Issuer pursuant to the Transfer and Servicing
Agreement; and
TENTH: to the Owner Trustee for distribution to the Residual
Interestholder pursuant to the Trust Agreement.
The Indenture Trustee may fix a record date and payment date (which shall be a
Monthly Payment Date) for any payment to Noteholders pursuant to this Section.
At least 15 days before such record date, the Issuer shall mail to each
Noteholder and the Indenture Trustee a notice that states the record date, the
payment date and the amount to be paid.
SECTION 5.05 Optional Preservation of the Receivables. If the Notes
have been declared to be due and payable under Section 5.02 following an Event
of Default and such declaration and its consequences have not been rescinded and
annulled, the Indenture Trustee 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 Indenture 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
Indenture Trustee may, but need not, obtain at the Issuer's expense 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 Limitation of Suits. No Holder of any Note shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(i) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(ii) the Holders of Notes representing not less than 25% of
the Outstanding Amount of the Notes have made written
request to the Indenture Trustee to institute such
Proceeding in respect of such Event of Default in its
own name as Indenture Trustee hereunder;
(iii) such Holder or Holders have offered to the Indenture
Trustee reasonable indemnity against the costs,
expenses and liabilities to be incurred in complying
with such request;
(iv) the Indenture 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 Indenture Trustee during such
60-day period by the Majority Noteholders.
It is understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
Holders of Notes or to obtain or to seek to obtain priority or preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of Notes,
each representing less than a majority of the Outstanding Amount of the Notes,
the Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provisions of this Indenture.
SECTION 5.07 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, if any, on such Note on or
after the respective due dates thereof expressed in such Note or in this
Indenture (or, in the case of redemption, on or after the Redemption Date) and
to institute suit for the enforcement of any such payment, and such right shall
not be impaired without the consent of such Holder.
SECTION 5.08 Restoration of Rights and Remedies. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right or
remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had been
instituted.
SECTION 5.09 Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or to the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.10 Delay or Omission Not a Waiver. No delay or omission of
the Indenture 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 and remedy given by this Article V or by law
to the Indenture Trustee or to the Noteholders may be exercised from time to
time, and as
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often as may be deemed expedient, by the Indenture Trustee or by the
Noteholders, as the case may be.
SECTION 5.11 Control by Noteholders. Subject to Section 5.16(b), the
Majority Noteholders shall have the right to direct the time, method and place
of conducting any Proceeding for any remedy available to the Indenture Trustee
with respect to the Notes or exercising any trust or power conferred on the
Indenture Trustee; provided that:
(i) such direction shall not be in conflict with any rule
of law or with this Indenture;
(ii) subject to the express terms of Section 5.04, any
direction to the Indenture Trustee to sell or
liquidate the Trust Estate shall be by Holders of
Notes representing not less than 100% of the
Outstanding Amount of the Notes;
(iii) if the conditions set forth in Section 5.05 have been
satisfied and the Indenture Trustee elects to retain
the Trust Estate pursuant to such Section, then any
direction to the Indenture Trustee by Holders of Notes
representing less than 100% of the Outstanding Amount
of the Notes to sell or liquidate the Trust Estate
shall be of no force and effect; and
(iv) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee that is not
inconsistent with such direction.
Notwithstanding the rights of Noteholders set forth in this Section, subject to
Section 6.01, the Indenture Trustee need not take any action that it determines
might involve it in personal liability or might materially adversely affect the
rights of any Noteholders not consenting to such action.
SECTION 5.12 Waiver of Past Defaults. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.02, the
Majority Noteholders may waive any Default or Event of Default then existing and
its consequences except a Default or Event of Default (a) in payment of
principal of or interest on any of the Notes, which shall be waived only with
the consent of the Holder of each Note, 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 Indenture
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 Event of Default or impair any right consequent
thereto.
Upon any such waiver, such Default or Event of Default shall cease to
exist and be deemed to have been cured and not to have occurred, and any Event
of Default arising from such Default 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.
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SECTION 5.13 Undertaking for Costs. All parties to this Indenture
agree, and each Holder of a Note by such Holder's acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (a) any suit instituted by the
Indenture Trustee, (b) any suit instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate Notes representing 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 5.14 Waiver of Stay or Extension Laws. The Issuer covenants (to
the extent that it may lawfully do so) that it shall 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 advantage of any such law, and covenants that it
shall not hinder, delay or impede the execution of any power herein granted to
the Indenture Trustee, but shall suffer and permit the execution of every such
power as though no such law had been enacted.
SECTION 5.15 Action on Notes. The Indenture Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the lien of this Indenture nor any rights or remedies
of the Indenture Trustee or the Noteholders shall be impaired by the recovery of
any judgment by the Indenture Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Trust Estate or upon any
of the assets of the Issuer. Any money or property collected by the Indenture
Trustee shall be applied in accordance with Section 5.04(b).
SECTION 5.16 Performance and Enforcement of Certain Obligations. (a) If
an Event of Default has occurred and is continuing, promptly following a request
from the Indenture Trustee to do so, the Issuer shall take all such lawful
action as the Indenture Trustee may request to compel or secure the performance
and observance by any party to the Transfer and Servicing Agreement, of each of
such party's obligations to the Issuer under or in connection with the Transfer
and Servicing Agreement, 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
Indenture Trustee, including the transmission of notices of default on the part
of any party to the Transfer and Servicing Agreement and the institution of
legal or administrative actions or proceedings to compel or secure performance
by any party to the Transfer and Servicing Agreement of such party's obligations
under the Transfer and Servicing Agreement.
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(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and at the direction (which direction shall be in writing
or by telephone (confirmed in writing promptly thereafter)) of the Holders of
Notes representing at least 66 2/3% of the Outstanding Amount of the Notes
shall, subject to the proviso and last sentence of Section 5.11, exercise all
rights, remedies, powers, privileges and claims of the Issuer against any party
to any of the Basic Documents under or in connection with any of the Basic
Documents, including the right or power to take any action to compel or secure
performance or observance by any party to any of the Basic Documents of such
party's obligations to the Issuer thereunder and to give any consent, request,
notice, direction, approval, extension or waiver under any of the Basic
Documents, and any right of the Issuer to take such action shall be suspended.
ARTICLE VI
The Indenture Trustee
SECTION 6.01 Duties of Indenture Trustee.
(a) If an Event of Default has occurred and is continuing, the
Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set
forth in this Indenture and the Transfer and Servicing
Agreement and no implied covenants or obligations
shall be read into this Indenture or the Transfer and
Servicing Agreement against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the Indenture
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon certificates or opinions
furnished to the Indenture Trustee and conforming to
the requirements of this Indenture or the Transfer and
Servicing Agreement; however, the Indenture Trustee
shall examine the certificates and opinions to
determine whether or not they conform to the
requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph
(b) of this Section;
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(ii) the Indenture Trustee shall not be liable for any
error of judgment made in good faith by a Responsible
Officer unless it is proved that the Indenture Trustee
was negligent in ascertaining the pertinent facts; and
(iii) the Indenture Trustee shall not be liable with respect
to any action it takes or omits to take in good faith
in accordance with a direction received by it pursuant
to Section 5.11 or Section 5.16(b).
(d) Every provision of this Indenture and the Transfer and Servicing
Agreement that in any way relates to the Indenture Trustee is subject to
paragraphs (a), (b), (c) and (g) of this Section.
(e) The Indenture Trustee shall not be liable for interest on any money
received by it except as the Indenture Trustee may agree in writing with the
Issuer.
(f) Money held in trust by the Indenture Trustee need not be segregated
from other funds except to the extent required by law or the terms of this
Indenture or the Transfer and Servicing Agreement.
(g) No provision of this Indenture or the Transfer and Servicing
Agreement shall require the Indenture Trustee to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder or thereunder or in the exercise of any of its rights or powers, if it
shall have reasonable grounds to believe that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
(h) Every provision of this Indenture or the Transfer and Servicing
Agreement relating to the conduct or affecting the liability of or affording
protection to the Indenture Trustee shall be subject to the provisions of this
Section and to the provisions of the TIA.
SECTION 6.02 Rights of Indenture Trustee.
(a) The Indenture Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The Indenture
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Indenture Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on an Officer's Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Indenture Trustee shall
not be responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.
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(d) The Indenture Trustee shall not be liable for any action it takes
or omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, that the Indenture Trustee's conduct does not
constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture and
the Notes shall be full and complete authorization and protection from liability
in respect to any action taken, omitted or suffered by it hereunder in good
faith and in accordance with the advice or opinion of such counsel.
(f) The Indenture Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Noteholders pursuant to this Indenture, unless such
Noteholders shall have offered to the Indenture Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be incurred by
it in compliance with such request or direction.
(g) The Indenture Trustee shall not be charged with knowledge of any
Default, Event of Default or Servicer Default unless (i) a Responsible Officer
of the Indenture Trustee assigned to its Corporate Trust Office shall have
actual knowledge thereof or (ii) written notice thereof shall have been given to
the Indenture Trustee by the Issuer, the Depositor, the Servicer or any
Noteholder.
SECTION 6.03 Individual Rights of Indenture Trustee. The Indenture
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Issuer, the Depositor, the Servicer or
their respective Affiliates with the same rights it would have if it were not
Indenture Trustee. Any Paying Agent, Note Registrar, co-registrar or co-paying
agent may do the same with like rights. However, the Indenture Trustee must
comply with Sections 6.11 and 6.12.
SECTION 6.04 Indenture Trustee's Disclaimer. The Indenture Trustee
shall not be responsible for and makes no representation as to the validity or
adequacy of this Indenture, the Collateral or the Notes, it shall not be
accountable for the Issuer's use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in this Indenture or in any
document issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee's certificate of authentication. The Indenture
Trustee shall have no responsibility for reviewing the contents of the
Receivable Files or for maintaining custody of or protecting same, for
monitoring the servicing of the Receivables by the Servicer or for perfecting or
continuing the perfection of the Indenture Trustee's security interest in the
Collateral, including the filing, re-filing, recording or re-recording of any
notice, instrument or document in any public office at any time or times. The
Indenture Trustee shall have no duty to conduct any affirmative investigation as
to the occurrence of any condition requiring the purchase of any Receivable
pursuant to the Transfer and Servicing Agreement.
SECTION 6.05 Notice of Defaults. If a Default occurs and is continuing
and if it is known to a Responsible Officer of the Indenture Trustee, the
Indenture Trustee shall mail to each Noteholder notice of the Default within 90
days after it occurs. Except in the case of a Default in payment of principal of
or interest on any Note (including payments pursuant to the redemption
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provisions of such Note), the Indenture Trustee may withhold the notice if and
so long as a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of Noteholders.
SECTION 6.06 Reports by Indenture Trustee to Holders. The Indenture
Trustee shall deliver to each Noteholder who was a Noteholder during the
applicable year, not later than the latest date permitted by law, such
information as may be required to enable such holder to prepare its federal and
state income tax returns, provided, that, such information shall consist only of
Form 1099s or any successor forms required to be given by Paying Agents to
Noteholders pursuant to the Code.
SECTION 6.07 Compensation and Indemnity. The Issuer shall pay to the
Indenture Trustee from time to time reasonable compensation for its services.
The Indenture Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Issuer shall reimburse the
Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by
it, including costs of collection, in addition to the compensation for its
services. Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Indenture Trustee's agents, counsel,
accountants and experts. The Issuer shall indemnify the Indenture Trustee
against any and all loss, liability or expense (including attorneys' fees)
incurred by it in connection with the administration of this trust and the
performance of its duties hereunder. The Indenture Trustee shall notify the
Issuer promptly of any claim for which it may seek indemnity. Failure by the
Indenture Trustee to so notify the Issuer shall not relieve the Issuer of its
obligations hereunder. The Issuer shall defend any such claim, and the Indenture
Trustee may have separate counsel and the Issuer shall pay the fees and expenses
of such counsel. The Issuer need not reimburse any expense or indemnify against
any loss, liability or expense incurred by the Indenture Trustee through the
Indenture Trustee's own willful misconduct, negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee pursuant to
this Section shall survive the discharge of this Indenture. Without prejudice to
any other rights available to the Indenture Trustee under applicable law, when
the Indenture 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.
SECTION 6.08 Replacement of Indenture Trustee. No resignation or
removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section 6.08. The Indenture Trustee
may resign at any time by so notifying the Issuer. The Majority Noteholders may
remove the Indenture Trustee by so notifying the Indenture Trustee and may
appoint a successor Indenture Trustee. The Issuer shall remove the Indenture
Trustee if:
(i) the Indenture Trustee fails to comply with Section
6.11;
(ii) the Indenture Trustee is adjudged a bankrupt or
insolvent;
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(iii) a receiver or other public officer takes charge of the
Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes incapable of
acting.
If the Indenture Trustee resigns or is removed by the Issuer or by the Majority
Noteholders (and the Majority Noteholders shall not have appointed a successor
Indenture Trustee and such successor Indenture Trustee shall not have accepted
its appointment as set forth below within 30 days after the Indenture Trustee
shall have been removed by such Majority Noteholders), or if a vacancy exists in
the office of Indenture Trustee for any reason (the Indenture Trustee in the
event of any such resignation, removal or vacancy being referred to herein as
the retiring Indenture Trustee), the Issuer shall promptly appoint a successor
Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer. Thereupon the
resignation or removal of the retiring Indenture Trustee shall become effective,
and the successor Indenture Trustee shall have all the rights, powers and duties
of the Indenture Trustee under this Indenture. The successor Indenture Trustee
shall mail a notice of its succession to Noteholders. The retiring Indenture
Trustee shall promptly, upon payment of its charges, transfer all property held
by it as Indenture Trustee to the successor Indenture Trustee
If a successor Indenture Trustee does not take office within 60 days
after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Majority Noteholders may petition any court
of competent jurisdiction for the appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant to
this Section, the Issuer's obligations under Section 6.07 shall continue for the
benefit of the retiring Indenture Trustee.
SECTION 6.09 Successor Indenture Trustee by Merger. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all its corporate trust business or assets to, another corporation
or banking association, the resulting, surviving or transferee corporation
without any further act shall be the successor Indenture Trustee; provided, that
such corporation or banking association shall be otherwise qualified and
eligible under Section 6.11. The Indenture Trustee shall provide the Rating
Agencies prior written notice of any such transaction. Such notice shall be
deemed given if a description of such transaction is published in a newspaper of
general circulation in The City of New York.
In case at the time such successor or successors by merger, conversion
or consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not delivered,
any such successor to the Indenture Trustee may adopt the
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certificate of authentication of any predecessor trustee and deliver such Notes
so authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.
SECTION 6.10 Appointment of Co-Indenture Trustee or Separate Indenture
Trustee.
(a) Notwithstanding any other 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 Estate may at the time be located, the Indenture
Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a co-trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Trust Estate, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Noteholders, such title to the Trust Estate, or any part hereof, and, subject to
the other provisions of this Section, such powers, duties, obligations, rights
and trusts as the Indenture Trustee may consider necessary or desirable. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 6.11 and no notice to
Noteholders of the appointment of any co-trustee or separate trustee shall be
required under Section 6.08 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred
or imposed upon the Indenture Trustee shall be
conferred or imposed upon and exercised or performed
by the Indenture Trustee and such separate trustee or
co-trustee jointly (it being understood that such
separate trustee or co-trustee is not authorized to
act separately without the Indenture Trustee joining
in such act), except to the extent that under any law
of any jurisdiction in which any particular act or
acts are to be performed the Indenture Trustee shall
be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and
obligations (including the holding of title to the
Trust Estate or any portion thereof in any such
jurisdiction) shall be exercised and performed singly
by such separate trustee or co-trustee, but solely at
the direction of the Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee
hereunder; and
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or
co-trustee.
(c) Any notice, request or other writing given to the Indenture Trustee
shall be deemed to have been given to
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each of the then separate trustees and co-trustees, as effectively as if given
to each of them. Every instrument appointing any separate trustee or co-trustee
shall refer to this Agreement and the conditions of this Article VI. Each
separate trustee and co-trustee, upon its acceptance of the trusts conferred,
shall be vested with the estates or property specified in its instrument of
appointment, either jointly with the Indenture Trustee or separately, as may be
provided therein, subject to all the provisions of this Indenture, specifically
including every provision of this Indenture relating to the conduct of,
affecting the liability of, or affording protection to, the Indenture Trustee.
Every such instrument shall be filed with the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee as its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Indenture on its behalf and in its name. If any separate trustee
or co-trustee shall die, become incapable of acting, resign or be removed, all
of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 6.11 Eligibility; Disqualification. The Indenture Trustee shall
at all times satisfy the requirements of TIA Section 310(a). The Indenture
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, and the time
deposits of the Indenture Trustee shall be rated at least A-1 by Standard &
Poor's and F1+ by Fitch. The Indenture Trustee shall comply with TIA Section
310(b), subject to the penultimate paragraph thereof; 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
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). An Indenture Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.
SECTION 6.13 Representations and Warranties. The Indenture Trustee
hereby represents and warrants to the Issuer, for the benefit of the
Noteholders, that:
(a) The Indenture Trustee is a banking corporation duly organized and
validly existing in good standing under the laws of the State of New York. The
Indenture Trustee has all requisite corporate power and authority to execute,
deliver and perform its obligations under this Indenture and each other Basic
Document to which it is a party.
(b) The Indenture Trustee has taken all action necessary to authorize
the execution and delivery by it of this Indenture and each of the other Basic
Documents to which it is a party, and this Indenture and each of the other Basic
Documents to which it is a party has been executed and delivered by one of its
officers who is duly authorized to execute and deliver this Indenture and each
of the other Basic Documents to which it is a party on its behalf.
(c) This Indenture and each of the other Basic Documents to which it is
a party constitutes a legal, valid and binding obligation of the Indenture
Trustee, enforceable against the
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Indenture Trustee in accordance with its respective terms, subject, as to
enforceability, to applicable insolvency, reorganization, conservatorship,
receivership, liquidation and other similar laws affecting enforcement of the
rights of creditors of banks generally and to equitable limitations on the
availability of specific remedies.
(d) Neither the execution or the delivery by the Indenture Trustee of
this Indenture and each of the other Basic Documents to which it is a party, nor
the consummation by it of the transactions contemplated hereby and thereby, nor
compliance by it with any of the terms or provisions hereof and thereof, shall
contravene any federal or state law, governmental rule or regulation governing
the banking or trust powers of the Indenture Trustee or any judgment or order
binding on it, or constitute any default under its charter documents or bylaws.
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.01 Issuer To Furnish Indenture Trustee Names and Addresses of
Noteholders. The Issuer shall furnish or cause to be furnished to the Indenture
Trustee (a) not more than five days after each Record Date, a list, in such form
as the Indenture Trustee may reasonably require, of the names and addresses of
the Holders of Notes as of such Record Date, and (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished; provided, however,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished.
SECTION 7.02 Preservation of Information; Communications to
Noteholders.
(a) The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as provided
in Section 7.01 and the names and addresses of Holders of Notes received by the
Indenture Trustee in its capacity as Note Registrar. The Indenture Trustee may
destroy any list furnished to it as provided in such Section 7.01 upon receipt
of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA Section 312(b) with
other Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall have
the protection of TIA Section 312(c).
SECTION 7.03 Reports by Issuer. (a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after
the Issuer is required to file the same with the
Commission, copies of the annual reports and of the
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information, documents and other reports (or copies of
such portions of any of the foregoing as the
Commission may from time to time by rules and
regulations prescribe) that the Issuer may be required
to file with the Commission pursuant to Section 13 or
15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from
time to time by the Commission such additional
information, documents and reports with respect to
compliance by the Issuer with the conditions and
covenants of this Indenture as may be required from
time to time by such rules and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture
Trustee shall transmit by mail to all Noteholders
described in TIA Section 313(c)) such summaries of any
information, documents and reports required to be
filed by the Issuer pursuant to clauses (i) and (ii)
of this Section 7.03(a) as may be required by rules
and regulations prescribed from time to time by the
Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year.
SECTION 7.04 Reports by Indenture Trustee. If required by TIA Section
313(a), within 60 days after each July 15 beginning with July 15, 1999, the
Indenture Trustee shall mail to each Noteholder as required by TIA Section
313(c) a brief report dated as of such date that complies with TIA Section
313(a). The Indenture Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Noteholders shall
be filed by the Indenture Trustee with the Commission and each stock exchange,
if any, on which the Notes are listed. The Issuer shall notify the Indenture
Trustee if and when the Notes are listed on any stock exchange.
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.01 Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable to
or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it as provided in this Indenture.
Except as otherwise expressly provided in this Indenture, if any default occurs
in the making of any payment or performance under any agreement or instrument
that is part of the Trust Estate, the Indenture Trustee may take such action as
may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate Proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this
Indenture and any
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right to proceed thereafter as provided in Article V. Notwithstanding the
foregoing provisions of this Section 8.01, the Indenture Trustee shall not be
empowered to demand payment of or to enforce payment or performance of any
Receivable, except during the continuance of an Event of Default, and, during
the pendency of such an Event of Default, shall be protected in refraining from
making any such demand or instituting any proceeding to enforce such payment or
performance as long as the Servicer shall be servicing the Receivables.
SECTION 8.02 Trust Accounts.
(a) On or prior to the Closing Date, the Issuer shall cause the
Servicer or the Indenture Trustee, as applicable, to establish and maintain the
Trust Accounts as provided in Section 5.01 of the Transfer and Servicing
Agreement.
(b) Collections with respect to the Receivables and other amounts with
respect to each Collection Period shall be deposited in the Collection Account
as provided in Sections 5.02 and 5.05 of the Transfer and Servicing Agreement.
On each Monthly Payment Date, all amounts required to be deposited in the Note
Distribution Account with respect to the preceding Collection Period pursuant to
Sections 5.06 and 5.07 of the Transfer and Servicing Agreement shall be
transferred from the applicable Trust Account to the Note Distribution Account.
(c) On each Monthly Payment Date and Redemption Date, the Indenture
Trustee shall distribute all amounts on deposit in the Note Distribution Account
to Noteholders in respect of the Notes to the extent of amounts due and unpaid
on the Notes for principal and interest in the following amounts and in the
following order of priority (subject to and except as otherwise provided in
Section 5.04(b)):
(i) an amount equal to the Noteholders' Interest
Distributable Amount shall be distributed:
(A) first, to the Class A Noteholders, on a pro rata
basis, without preference or priority of any kind
(including without preference or priority among
the different Classes of the Class A Notes),
interest accrued for the related Interest Accrual
Period at the respective Interest Rates for the
different Classes of the Class A Notes, plus
interest due and unpaid on the Class A Notes from
prior Interest Accrual Periods (plus interest on
overdue interest on each Class of the Class A
Notes at the respective Interest Rate for such
Class of the Class A Notes, to the extent
permitted by law);
(B) second, after giving effect to clause (i)(A), to
the Class B Noteholders, on a pro rata basis
without preference or priority, interest accrued
for the related Interest Accrual Period at the
Class B Interest Rate on the Class B Notes, plus
interest due and unpaid on the Class B Notes from
prior Interest Accrual Periods (plus interest on
overdue interest on the
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(C) third, after giving effect to clauses (i)(A) and
(i)(B), to the Class C Noteholders, on a pro rata
basis without preference or priority, interest
accrued for the related Interest Accrual Period
at the Class C Interest Rate on the Class C
Notes, plus interest due and unpaid on the Class
C Notes from prior Interest Accrual Periods (plus
interest on overdue interest on the Class C Notes
at the Class C Interest Rate to the extent
permitted by law); and
(ii) an amount equal to the Noteholders' Monthly Principal
Distributable Amount shall be distributed in the
following order of priority in each case to the extent
of the remaining amounts on deposit in the Note
Distribution Account after giving effect to
distributions pursuant to clause (i):
(A) to the Holders of the Class A-1 Notes on account
of principal until the Outstanding Amount of the
Class A-1 Notes is reduced to zero;
(B) to the Holders of the Class A-2 Notes on account
of principal until the Outstanding Amount of the
Class A-2 Notes is reduced to zero;
(C) to the Holders of the Class A-3 Notes on account
of principal until the Outstanding Amount of the
Class A-3 Notes is reduced to zero;
(D) to the Holders of the Class A-4 Notes on account
of principal until the Outstanding Amount of the
Class A-4 Notes is reduced to zero;
(E) to the Holders of the Class A-5 Notes on account
of principal until the Outstanding Amount of the
Class A-5 Notes is reduced to zero;
(F) to the Holders of the Class A-6 Notes on account
of principal until the Outstanding Amount of the
Class A-6 Notes is reduced to zero;
(G) to the Holders of the Class B Notes on account of
principal until the Outstanding Amount of the
Class B Notes is reduced to zero; and
(H) to the Holders of the Class C Notes on account of
principal until the Outstanding Amount of the
Class C Notes is reduced to zero.
SECTION 8.03 General Provisions Regarding Accounts.
(a) So long as no Default or Event of Default shall have occurred and
be continuing, all or a portion of the funds in the Trust Accounts shall be
invested or reinvested in Eligible Investments pursuant to Section 5.01(b) of
the Transfer and Servicing Agreement by the Indenture
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Trustee. The Servicer shall not direct the Indenture Trustee to make any
investment of any funds or to sell any investment held in any of the Trust
Accounts unless the security interest Granted and perfected in such account
shall continue to be perfected in such investment or the proceeds of such sale,
in either case without any further action by any Person, and, in connection with
any direction to the Indenture Trustee to make any such investment or sale, if
requested by the Indenture Trustee, the Issuer shall deliver to the Indenture
Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to such
effect.
(b) Subject to Section 6.01(c), the Indenture Trustee shall not in any
way be held liable by reason of any insufficiency in any of the Trust Accounts
resulting from any loss on any Eligible Investment included therein except for
losses attributable to the Indenture Trustee's failure to make payments on such
Eligible Investments issued by the Indenture Trustee, in its commercial capacity
as principal obligor and not as trustee, in accordance with their terms.
(c) If (i) the Servicer (pursuant to Section 5.01(b) of the Transfer
and Servicing Agreement) shall have failed to give investment directions for any
funds on deposit in the Trust Accounts to the Indenture Trustee by 11:00 a.m.
Eastern Time (or such other time as may be agreed by the Servicer and Indenture
Trustee) on any Business Day or (ii) a Default or Event of Default shall have
occurred and be continuing with respect to the Notes but the Notes shall not
have been declared due and payable pursuant to Section 5.02 or (iii) if such
Notes shall have been declared due and payable following an Event of Default but
amounts collected or receivable from the Trust Estate are being applied in
accordance with Section 5.05 as if there had not been such a declaration, then
the Indenture Trustee shall, to the fullest extent practicable, invest and
reinvest funds in the Trust Accounts (other than the Note Distribution Account)
in money market funds having a rating from each of the Rating Agencies in the
highest investment category granted thereby (including funds for which the
Indenture Trustee or the Owner Trustee or any of their respective Affiliates is
investment manager or advisor).
(d) Nothing in this Section 8.03 shall require the investment of any
funds on deposit in the Note Distribution Account.
SECTION 8.04 Release of Trust Estate. (a) Subject to the payment of its
fees, expenses and indemnities pursuant to Section 6.07, the Indenture Trustee
shall, when required by Section 8.04(b), execute instruments (prepared by the
Issuer) to release (without recourse or warranty) property from the lien of this
Indenture, or convey the Indenture Trustee's interest in the same, in a manner
and under circumstances that are not inconsistent with the provisions of this
Indenture. No party relying upon an instrument executed by the Indenture Trustee
as provided in this Article VIII shall be bound to ascertain the Indenture
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any moneys.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and all sums due the Indenture Trustee pursuant to Section 6.07 have
been paid, release any remaining portion of the Trust Estate that secured the
Notes from the lien of this Indenture and release to the Issuer or any other
Person entitled thereto any funds then on deposit in the Trust Accounts. The
Indenture Trustee shall release property from the lien of this Indenture
pursuant to this Section
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8.04(b) only upon receipt of an Issuer Request accompanied by an Officer's
Certificate, an Opinion of Counsel and (if required by the TIA) Independent
Certificates in accordance with TIA Sections 314(c) and 314(d)(1) meeting the
applicable requirements of Section 11.01.
SECTION 8.05 Opinion of Counsel. The Indenture Trustee shall receive at
least seven days notice when requested by the Issuer to take any action pursuant
to Section 8.04(a), accompanied by copies of any instruments involved, and the
Indenture Trustee shall also require, as a condition to such action, an Opinion
of Counsel, in form satisfactory to the Indenture Trustee, stating the legal
effect of any such action, outlining the steps required to complete the same,
and concluding that all conditions precedent to the taking of such action have
been complied with and such action shall not materially and adversely impair the
security for the Notes or the rights of the Noteholders in contravention of the
provisions of this Indenture; provided, however, that such Opinion of Counsel
shall not be required to express an opinion as to the fair value of the Trust
Estate. Counsel rendering any such opinion may rely, without independent
investigation, on the accuracy and validity of any certificate or other
instrument delivered to the Indenture Trustee in connection with any such
action.
ARTICLE IX
Supplemental Indentures
SECTION 9.01 Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of the Holders of any Notes but with prior
notice to the Rating Agencies, the Issuer and the Indenture Trustee, when
authorized by an Issuer Order, at any time and from time to time, may enter into
one or more indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as in force at the date of the execution
thereof), in form satisfactory to the Indenture Trustee, for any of the
following purposes:
(i) to correct or amplify the description of any property
at any time subject to the lien of this Indenture, or
better to assure, convey and confirm unto the
Indenture Trustee any property subject or required to
be subjected to the lien of this Indenture, or to
subject to the lien of 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 Indenture Trustee;
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(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture that
may be inconsistent with any other provision herein or
in any supplemental indenture or to make any other
provisions with respect to matters or questions
arising under this Indenture or in any supplemental
indenture; provided, that such action shall not
adversely affect in any material respect the interests
of the Holders of the Notes;
(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
(viii) to enable all or a portion of the Trust to qualify as
a "financial asset securitization investment trust"
under federal tax laws and regulations (a "FASIT"), to
permit a FASIT election to be made under such laws and
regulations and to make such modifications to this
Indenture as may be permitted by reason of the making
of such election; provided that (i) the Rating Agency
Condition shall have been satisfied with respect
thereto, (ii) an Opinion of Counsel is rendered that
such election will not have material adverse
consequences to any Noteholder or Residual
Interestholder, and (iii) the ability of the FASIT to
add or remove assets shall be limited to the same
extent as "real estate mortgage investment conduits"
("REMICs") under applicable federal tax laws and
regulations.
The Indenture Trustee is hereby authorized to join in the execution of any such
supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, may, also without the consent of any of the Holders of the Notes but with
prior notice to the Rating Agencies, 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. The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may,
with prior notice to the Rating Agencies and with the consent of the Majority
Noteholders,
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by Act of such Majority Noteholders delivered to the Issuer and the Indenture
Trustee, enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture or of modifying in any manner the
rights of the 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 of payment of any installment of
principal of or interest on any Note, or reduce the
principal amount thereof, the interest rate thereon or
the Redemption Price with respect thereto, change the
provisions of this Indenture relating to the
application of collections on, or the proceeds of the
sale of, the 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) 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
certain defaults hereunder and their consequences
provided for in this Indenture;
(iii) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding Amount of the
Notes required to direct the Indenture Trustee
pursuant to Sections 5.11 or 5.16(b) or to direct the
Indenture Trustee to sell or liquidate the Trust
Estate pursuant to Section 5.04;
(v) modify any provision of this Section except to
increase any percentage specified herein or to provide
that certain additional provisions of this Indenture
cannot be modified or waived without the consent of
the Holder of each Outstanding Note affected thereby;
(vi) modify any of the provisions of this Indenture in such
manner as to affect the calculation of the amount of
any payment of interest or principal due on any Note
on any Monthly Payment Date (including the calculation
of any of the individual components of such
calculation) or to affect the rights of the Holders of
Notes to the benefit of any provisions for the
redemption of the Notes contained herein; or
(vii) permit the creation of any lien ranking prior to or on
a parity with the lien of this Indenture with respect
to any part of the Trust Estate or, except as
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otherwise permitted or contemplated herein, terminate
the lien of this Indenture on any property at any time
subject hereto or deprive the Holder of any Note of
the security provided by the lien of this Indenture.
The Indenture Trustee may in its discretion determine whether or not any Notes
would be affected by any supplemental indenture and any such determination shall
be conclusive upon the Holders of all Notes, whether theretofore or thereafter
authenticated and delivered hereunder. The Indenture Trustee shall not be liable
for any such determination made in good faith.
It shall not be necessary for any Act of Noteholders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Indenture Trustee of any
supplemental indenture pursuant to this Section, the Indenture Trustee shall
mail to the Holders of the Notes to which such amendment or supplemental
indenture relates a notice setting forth in general terms the substance of such
supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
This Section 9.02 is subject to Section 5.07.
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 modification thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled to receive, and
subject to Sections 6.01 and 6.02, shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Indenture Trustee may, but shall
not be obligated to, enter into any such supplemental indenture that affects the
Indenture Trustee's own rights, duties, liabilities or immunities under this
Indenture or otherwise.
SECTION 9.04 Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and shall be deemed to be modified and amended in accordance therewith
with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the Holders of the Notes
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 9.05 Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article 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.
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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 Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
Redemption of Notes
SECTION 10.01 Redemption. The Notes are subject to redemption in whole,
but not in part on any Monthly Payment Date on which the Servicer exercises its
option to purchase the Trust Estate pursuant to Section 9.01(a) of the Transfer
and Servicing Agreement, for a purchase price equal to the Redemption Price
(such Monthly Payment Date being referred to as the "Redemption Date"). The
Servicer shall furnish the Rating Agencies notice of such redemption. If the
Notes are to be redeemed pursuant to this Section 10.01, the Servicer shall
furnish notice of such election to the Indenture Trustee not later than 50 days
prior to the Redemption Date and the Issuer shall deposit or cause to be
deposited by 10:00 A.M. New York City time on the Redemption Date with the
Indenture Trustee in the Note Distribution Account the Redemption Price of each
Class of Notes whereupon all such Notes shall be due and payable on the
Redemption Date upon the furnishing of a notice complying with Section 10.02 to
each Holder of the Notes.
SECTION 10.02 Form of Redemption Notice. Notice of redemption under
Section 10.01 shall be given by the Indenture Trustee by first-class mail,
postage prepaid, or by facsimile mailed or transmitted, not later than 30 days
prior to the applicable Redemption Date to each Holder of Notes, as of the close
of business on the Record Date preceding the giving of such notice, at such
Holder's address or facsimile number appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
(iii) the place where such Notes are to be surrendered for
payment of the Redemption Price (which shall be the
office or agency of the Issuer to be maintained as
provided in Section 3.02).
Notice of redemption of the Notes shall be given by the Indenture Trustee in the
name and at the expense of the Issuer. Failure to give notice of redemption, or
any defect therein, to any Holder of any Note shall not impair or affect the
validity of the redemption of any other Note.
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SECTION 10.03 Notes Payable on Redemption Date. The Notes shall,
following notice of redemption 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.
ARTICLE XI
Miscellaneous
SECTION 11.01 Compliance Certificates and Opinions, etc.
(a) Upon any application or request by the Issuer to the Indenture
Trustee to take any action under any provision of this Indenture, the Issuer
shall furnish to the Indenture Trustee (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:
(1) 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;
(2) 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;
(3) 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
(4) a statement as to whether, in the opinion of each
such signatory, such condition or covenant has been
complied with.
(b) (i) Prior to the deposit of any Collateral or other property
or securities with the Indenture Trustee that is to be
made the basis for the release of any property or
securities subject to the lien of this Indenture, the
Issuer shall, in addition to any
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obligation imposed in Section 11.01(a) or elsewhere in
this Indenture, furnish to the Indenture 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 deposit) to the Issuer of
the Collateral or other property or securities to be so
deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or
stating the opinion of any signer thereof as to the
matters described in clause (i) above, the Issuer shall
also deliver to the Indenture Trustee an Independent
Certificate as to the same matters, if the fair value to
the Issuer of the property or securities to be so
deposited and of all other such property or securities
made the basis of any such 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 or securities 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) Whenever any property or securities are to be released
from the lien of this Indenture, the Issuer shall also
furnish to the Indenture 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 shall
not impair the security under this Indenture in
contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or
stating the opinion of any signer thereof as to the
matters described in clause (iii) above, the Issuer
shall also furnish to the Indenture Trustee an
Independent Certificate as to the same matters if the
fair value of the property or securities and of all
other property, other than property as contemplated by
clause (v) below or securities released from the lien of
this Indenture since the commencement of the
then-current calendar 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.
(v) Notwithstanding any other provision of this Section, the
Issuer may, without compliance with the requirements of
the other provisions of this Section, (A) collect,
liquidate, sell or otherwise dispose of Receivables or
Financed Vehicles as and to the extent permitted or
required by the Basic Documents and (B) make cash
payments out of the Trust Accounts as and to the extent
permitted or
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required by the Basic Documents, so long as the Issuer
shall deliver to the Indenture Trustee every six months,
commencing on the day which is six months after the
Closing Date (or, if such day is not a Business Day, on
the next Business Day), an Officer's Certificate of the
Issuer stating that all the dispositions of Collateral
described in clauses (A) or (B) above that occurred
during the preceding six calendar months were in the
ordinary course of the Issuer's business and that the
proceeds thereof were applied in accordance with the
Basic Documents.
SECTION 11.02 Form of Documents Delivered to Indenture Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which such officer's
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 any party to the Transfer and Servicing Agreement,
stating that the information with respect to such factual matters is in the
possession of such party to the Transfer and Servicing Agreement, unless the
person signing such certificate of an Authorized Officer or such Opinion of
Counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI.
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SECTION 11.03 Acts of Noteholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided
such action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee and, where it is hereby expressly required,
to the Issuer. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Noteholders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 6.01) conclusive in
favor of the Indenture Trustee and the Issuer, if made in the manner provided in
this Section.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Notes shall bind the Holder of every
Note issued upon the registration thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Note.
SECTION 11.04 Notices, etc., to Indenture Trustee, Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Noteholders or other documents provided or permitted by this Indenture
to be made upon, given or furnished to or filed with:
(i) the Indenture Trustee by any Noteholder or by the Issuer
shall be sufficient for every purpose hereunder if made,
given, furnished or filed in writing to or with the
Indenture Trustee at its Corporate Trust Office, or
(ii) the Issuer by the Indenture Trustee or by any Noteholder
shall be sufficient for every purpose hereunder if in
writing and mailed first-class, postage prepaid to the
Issuer addressed to: Distribution Financial Services RV
Trust 1999-1, in care of the Owner Trustee at its
Corporate Trust Office, or at any other address
previously furnished in writing to the Indenture Trustee
by the Issuer. The Issuer shall promptly transmit any
notice received by it from the Noteholders to the
Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally delivered
or mailed by certified mail, return receipt requested, to (i) in the case of
Fitch, at the following address: Fitch IBCA, Inc., One State Street
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<PAGE>
Plaza, New York 10004, Attention: Asset-Backed Securities Surveillance Group, or
(ii) in the case of Standard & Poor's, at the following address: Standard &
Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc., 25
Broadway (15th Floor), New York, New York 10004, Attention: Asset Backed
Surveillance Department; or as to each of the foregoing, at such other address
as shall be designated by written notice to the other parties.
SECTION 11.05 Notices to Noteholders; Waiver. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid, or sent by facsimile transmission, to
each Noteholder affected by such event, at such Holder's address as it appears
on the Note Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. In any case where
notice to Noteholders is given by mail, neither the failure to mail such notice
nor any defect in any notice so mailed to any particular Noteholder shall affect
the sufficiency of such notice with respect to other Noteholders, and any notice
that is mailed in the manner herein provided shall conclusively be presumed to
have been duly given.
Where this Indenture provides for notice in any manner, such notice may
be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Noteholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Indenture Trustee shall be deemed to
be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute a Default or
Event of Default.
SECTION 11.06 Alternate Payment and Notice Provisions. Notwithstanding
any provision of this Indenture or any of the Notes to the contrary, the Issuer
may enter into any agreement with any Holder of a Note providing for a method of
payment, or notice by the Indenture Trustee or any Paying Agent to such Holder,
that is different from the methods provided for in this Indenture for such
payments or notices. The Issuer shall furnish to the Indenture Trustee a copy of
each such agreement and the Indenture Trustee shall cause payments to be made
and notices to be given in accordance with such agreement if it is
administratively acceptable to it.
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.
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<PAGE>
The provisions of TIA Sections 310 through 317 that impose duties on
any person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
SECTION 11.08 Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 11.09 Successors and Assigns. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Indenture Trustee in
this Indenture shall bind its successors, co-trustees and agents.
SECTION 11.10 Separability. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
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.
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
CONFLICT 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 and the Issuer shall deliver to the
Indenture Trustee an Opinion of Counsel to the effect that such recording is
necessary either for the protection of the Noteholders or any other Person
secured hereunder or for the enforcement of any right or remedy granted to the
Indenture Trustee under this Indenture.
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<PAGE>
SECTION 11.16 Trust Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) the
Residual Interestholder or any other owner of a beneficial interest in the
Issuer or (iii) any partner, owner, beneficiary, officer, director, employee or
agent of the Indenture Trustee or the Owner Trustee in its individual capacity,
the Residual Interestholder or any other holder of a beneficial interest in the
Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign
of the Indenture Trustee or the Owner Trustee in its individual capacity, except
as any such Person may have expressly agreed (it being understood that the
Indenture Trustee and the Owner Trustee have no such obligations in their
individual capacities) and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity. For all purposes of this Indenture, in
the performance of any duties or obligations of the Issuer hereunder, the Owner
Trustee shall be subject to, and entitled to the benefits of, the terms and
provisions of Article VI, VII and VIII of the Trust Agreement.
SECTION 11.17 No Petition. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, and each Note Owner, by
accepting a beneficial interest in a Note, hereby covenant and agree that they
shall not at any time acquiesce, petition or otherwise invoke or cause (or join
with any other Person in acquiescing, petitioning or otherwise invoking or
causing) the Depositor or the Issuer to invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Depositor or the Issuer 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 Depositor or the Issuer or any
substantial part of the property of the Depositor or the Issuer, or ordering the
winding up or liquidation of the affairs of the Depositor or the Issuer.
SECTION 11.18 No Prohibited Transaction. Each investor using the
assets of a Benefit Plan which acquires a Note, or to whom a Note is transferred
by its acceptance and holding of any Note or an interest therein, will be deemed
to represent and warrant that its acquisition and continued holding will not,
throughout the term of the holding, result in a non-exempt prohibited
transaction under Section 406 of the Employment Retirement Income Security Act
of 1974, as amended, or Section 4975 of the Internal Revenue Code of 1986, as
amended.
SECTION 11.19 Inspection. The Issuer agrees that, on reasonable prior
notice, it shall permit any representative of the Indenture Trustee, during the
Issuer's normal business hours, to examine all the books of account, records,
reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees and Independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested. The Indenture
Trustee shall, and shall cause its representatives to, hold in confidence all
such information except to the extent disclosure may be required by law (and all
reasonable applications for confidential treatment are unavailing) and except to
the extent that the
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<PAGE>
Indenture Trustee may reasonably determine that such disclosure is consistent
with its obligations hereunder.
SECTION 11.20 Submission to Jurisdiction. Each of the parties hereto
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Indenture or any other Basic Document or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Person at its
address set forth in Section 11.04 or at such other address notified to the
other party to this Indenture pursuant thereto; and
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to sue
in any other jurisdiction.
[SIGNATURES FOLLOW]
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<PAGE>
IN WITNESS WHEREOF, the Issuer and the Indenture 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.
DISTRIBUTION FINANCIAL SERVICES RV
TRUST 1999-1,
By: NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, not in its individual
capacity but solely as Owner Trustee
By: /s/ Marianna C. Stershic
----------------------------------------
Name: Marianna C. Stershic
Title: Assistant Vice President
THE CHASE MANHATTAN BANK, not in its individual
capacity but solely as Indenture Trustee
By: /s/ Jo Ann Manieri
----------------------------------------
Name: Jo Ann Manieri
Title: Trust Officer
S-1
<PAGE>
STATE OF MINNESOTA )
) ss.:
COUNTY OF HENNEPIN )
BEFORE ME, the undersigned authority, a Notary Public in and for said
county and state, on this day personally appeared Marianna C. Stershic, known to
me to be the person and officer whose name is subscribed to the foregoing
instrument and acknowledged to me that the same was the act of DISTRIBUTION
FINANCIAL SERVICES RV TRUST 1999-1, a New York common law trust, and that (s)he
executed the same as the act of said trust for the purpose and consideration
therein expressed, and in the capacities therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this 18th day of March, 1999.
/s/ Stephen P. Seitz
-----------------------------------------------
Notary Public in and for the State of Minnesota
My commission expires:
01/31/2000
- -----------------------
S-2
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BEFORE ME, the undersigned authority, a Notary Public in and for said
county and state, on this day personally appeared JoAnn Manieri, known to me to
be the person and officer whose name is subscribed to the foregoing instrument
and acknowledged to me that the same was the act of THE CHASE MANHATTAN BANK, a
New York banking corporation, and that (s)he executed the same as the act of
said corporation for the purpose and consideration therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this 18th day of March, 1999.
/s/ Kristen Driscoll
-----------------------------------------------
Notary Public in and for the State of New York.
My commission expires:
March 9, 2000
- -----------------------
S-3
<PAGE>
EXHIBIT A
(FORM OF NOTE)
<PAGE>
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.
[For Class B Notes Only: THIS CLASS B NOTE IS SUBORDINATED TO THE CLASS A NOTES
AS CONTEMPLATED BY THE INDENTURE REFERRED TO BELOW.]
[For Class C Notes Only: THIS CLASS C NOTE IS SUBORDINATED TO THE CLASS A NOTES
AND THE CLASS B NOTES AS CONTEMPLATED BY THE INDENTURE REFERRED TO BELOW.]
REGISTERED
$
------------
Class [ ] Interest Rate: __%
CUSIP Number: ___________
ISIN Number: ___________
No. R-__
<PAGE>
DISTRIBUTION FINANCIAL SERVICES RV TRUST 1999-1
CLASS [ ] ASSET BACKED NOTES
Distribution Financial Services RV Trust 1999-1, a New York common law
trust (herein referred to as the "Issuer"), for value received, hereby promises
to pay to _________, or registered assigns, the principal sum of ___________
DOLLARS payable on each Monthly Payment Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is the outstanding
principal balance of this Note and the denominator of which is the aggregate
outstanding principal balance of the Notes of this Class by (ii) the aggregate
amount, if any, payable from the Note Distribution Account in respect of
principal on the Notes of this Class pursuant to the Indenture dated as of March
1, 1999 (the "Indenture"), between the Issuer and The Chase Manhattan Bank, a
New York banking corporation, as Indenture Trustee (the "Indenture Trustee");
provided, however, that the entire unpaid principal amount of this Note shall be
due and payable on the earlier of the Stated Maturity Date of this Class and the
Redemption Date, if any. Capitalized terms used but not defined herein are as
defined in or by reference in the Indenture, which also contains rules as to
construction that shall be applicable herein.
The Issuer shall pay interest on this Note at the rate per annum shown
above on each Monthly Payment Date until the principal of this Note is paid or
made available for payment, on the principal amount of this Note outstanding on
the preceding Monthly Payment Date (after giving effect to all payments of
principal made on the preceding Monthly Payment Date), subject to certain
limitations contained in the Indenture. Interest on this Note shall accrue for
each Monthly Payment Date from and including the Closing Date (in the case of
the first Monthly Payment Date) or from and including the most recent Monthly
Payment Date on which interest has been paid to but excluding such Monthly
Payment Date. (Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.) ([For Class A-1 only: Interest shall be computed on the
basis of the actual number of days in each Interest Accrual Period divided by
360.]) 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 Indenture 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.
-2-
<PAGE>
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer, as of the date set forth
below.
Date:_________________
DISTRIBUTION FINANCIAL SERVICES RV
TRUST 1999-1,
By: NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Owner Trustee under the Trust Agreement
By:
-----------------------------------
Authorized Officer
S-1
<PAGE>
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: THE CHASE MANHATTAN BANK, not in its
--------------------- individual capacity but solely as
Indenture Trustee
By:
----------------------------------
Authorized Officer
S-2
<PAGE>
This Note is one of a duly authorized issue of Notes of the Issuer,
issued under the Indenture, to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Notes. The Notes are subject to all terms of the Indenture. In the event of
any conflict or inconsistency between this Note and the Indenture, the Indenture
shall govern in all respects.
Payments on this Note, shall be made in accordance with the Indenture.
Any reduction in the principal amount of this Note (or any one or more
Predecessor Notes) effected by any payments made on any Monthly 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.
The Issuer shall pay interest on overdue installments of interest at
the Interest Rate for this Class to the extent lawful.
The transfer and exchange of this Note are subject to the terms of the
Indenture.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under
the Indenture or any certificate or other writing delivered in connection
therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) the Residual Interestholder or any other owner of a
beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
officer, director, employee or agent of the Indenture Trustee or the Owner
Trustee in its individual capacity, the Residual Interestholder or any other
holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Indenture Trustee and the Owner
Trustee have no such obligations in their individual capacities) and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution or failure to pay any installment or call owing to such
entity.
Each investor using the assets of a Benefit Plan which acquires a Note,
or to whom a Note is transferred by its acceptance and holding of any Note or an
interest therein, will be deemed to represent and warrant that its acquisition
and continued holding will not, throughout the term of the holding, result in a
non-exempt prohibited transaction under Section 406 of the Employment Retirement
Income Security Act of 1974, as amended, or Section 4975 of the Internal Revenue
Code of 1986, as amended.
Each Noteholder, by accepting a Note, and each Note Owner, by accepting
a beneficial interest in a Note, covenants and agrees that such Noteholder and
Note Owner shall not at any time acquiesce, petition or otherwise invoke or
cause (or join with any other Person in acquiescing, petitioning or otherwise
invoking or causing) the Depositor or the Issuer to invoke the process of
S-3
<PAGE>
any court or government authority for the purpose of commencing or sustaining a
case against the Depositor or the Issuer 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 Depositor or
the Issuer or any substantial part of the property of the Depositor or the
Issuer, or ordering the winding up or liquidation of the affairs of the
Depositor or the Issuer.
The Issuer has entered into the Indenture and this Note is issued with
the intention that, for all purposes, including federal, state and local income,
single business and franchise tax purposes, the Notes shall qualify as
indebtedness of the Issuer secured by the Trust Estate. Each Noteholder, by
acceptance of a Note (and each Note Owner by acceptance of a beneficial interest
in a Note), agrees to treat the Notes for all purposes, including federal, state
and local income, single business and franchise tax purposes, as indebtedness of
the Issuer.
Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Note is registered (as of the
day of determination or as of such other date as may be specified in the
Indenture) as the owner hereof for the purpose of receiving payments of
principal of and interest, if any, on this Note and for all other purposes
whatsoever, whether or not this Note be overdue, and none of the Issuer, the
Indenture Trustee or any agent of the Issuer or the Indenture Trustee shall be
affected by notice to the contrary.
The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.
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 contemplated by the
Indenture and this Note.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of The Chase Manhattan Bank, in its
individual capacity, Norwest Bank Minnesota, National Association, in its
individual capacity, the Residual Interestholder or any other owner of a
beneficial interest in the Issuer, or 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 this Note or performance of, or
failure to perform, any of the covenants, obligations or indemnifications
contained in the Indenture. The Holder of this Note by its acceptance hereof
(and each Note Owner, by accepting a beneficial interest in this Note) agrees
that, except as expressly provided in the Basic Documents, in the case of an
Event of Default under the Indenture, no claim shall be had 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
S-4
<PAGE>
Issuer for any and all liabilities, obligations and undertakings contained in
the Indenture or in this Note.
S-5
<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:
*/
---------------------------------
---------------------------------
*/ NOTICE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.
S-6
<PAGE>
Exhibit 10.1
TRANSFER AND SERVICING AGREEMENT
among
DISTRIBUTION FINANCIAL SERVICES RV TRUST 1999-1,
as Issuer,
DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION,
as Depositor
and
DEUTSCHE FINANCIAL SERVICES CORPORATION,
as Servicer
Dated as of March 1, 1999
<PAGE>
TABLE OF CONTENTS
ARTICLE I
Definitions
SECTION 1.01. Definitions.................................................1
SECTION 1.02. Other Definitional Provisions...............................1
ARTICLE II
Contribution of Receivables
SECTION 2.01. Contribution................................................2
SECTION 2.02. Intent of the Parties.......................................2
ARTICLE III
The Receivables
SECTION 3.01. Representations and Warranties with Respect to
the Receivables.............................................3
SECTION 3.02. Custody of Receivable Files.................................5
SECTION 3.03. Duties of Servicer as Custodian.............................6
SECTION 3.04. Instructions; Authority To Act..............................6
SECTION 3.05. Custodian's Indemnification.................................6
SECTION 3.06. Effective Period and Termination............................7
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.01. Duties of Servicer..........................................7
SECTION 4.02. Collection and Application of Receivable Payments...........8
SECTION 4.03. Realization upon Receivables................................8
SECTION 4.04. Physical Damage Insurance...................................9
SECTION 4.05. Maintenance of Security Interests in Financed Vehicles......9
SECTION 4.06. Covenants of Servicer.......................................9
SECTION 4.07. Purchase of Receivables upon Breach.........................9
SECTION 4.08. Servicing Fee..............................................10
SECTION 4.09. Servicer's Certificate.....................................10
SECTION 4.10. Annual Statement as to Compliance; Notice of Default.......10
SECTION 4.11. Annual Independent Certified Public Accountants' Report....11
SECTION 4.12. Access to Certain Documentation and Information Regarding
Receivables.........................................11
SECTION 4.13. Servicer Expenses..........................................12
SECTION 4.14. Appointment of Subservicer.................................12
i
<PAGE>
SECTION 4.15. Fidelity Bond; Errors and Omissions Insurance..............12
ARTICLE V
Distributions; Statements to Noteholders
SECTION 5.01. Establishment of Trust Accounts............................13
SECTION 5.02. Collections................................................16
SECTION 5.03. Application of Collections.................................17
SECTION 5.04. Advances...................................................17
SECTION 5.05. Additional Deposits........................................18
SECTION 5.06. Distributions..............................................18
SECTION 5.07. Reserve Account............................................19
SECTION 5.08. Statements to Noteholders..................................20
ARTICLE VI
The Depositor
SECTION 6.01. Representations of Depositor...............................21
SECTION 6.02. Corporate Existence........................................22
SECTION 6.03. Liability of the Depositor.................................22
SECTION 6.04. Indemnification............................................23
SECTION 6.05. Merger or Consolidation of, or Assumption of the
Obligations of, Depositor...........................24
SECTION 6.06. Limitation on Liability of Depositor and Others............24
SECTION 6.07. Depositor May Own Notes....................................24
SECTION 6.08. Pennsylvania Motor Vehicle Sales Finance Act License.......24
ARTICLE VII
The Servicer
SECTION 7.01. Representations and Warranties of the Servicer.............25
SECTION 7.02. Indemnities, etc. of Servicer..............................26
SECTION 7.03. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer............................27
SECTION 7.04. Limitation on Liability of Servicer and Others.............27
SECTION 7.05. Resignation of Servicer....................................28
ARTICLE VIII
Servicer Default
SECTION 8.01. Servicer Default...........................................29
SECTION 8.02. Appointment of Successor...................................30
SECTION 8.03. Repayment of Advances......................................31
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SECTION 8.04. Notification to Noteholders................................31
SECTION 8.05. Waiver of Past Defaults....................................31
ARTICLE IX
Termination
SECTION 9.01. Optional Purchase of All Receivables.......................31
ARTICLE X
Miscellaneous
SECTION 10.01. Amendment.................................................32
SECTION 10.02. Protection of Title to Trust; Change of Name, Identity,
Corporate Structure or Location of the
Depositor, Etc....................................33
SECTION 10.03. Notices...................................................34
SECTION 10.04. Assignment................................................35
SECTION 10.05. Limitations on Rights of Others...........................35
SECTION 10.06. Severability..............................................35
SECTION 10.07. Separate Counterparts.....................................35
SECTION 10.08. Headings..................................................35
SECTION 10.09. Governing Law.............................................36
SECTION 10.10. Nonpetition Covenants.....................................36
SECTION 10.11. Limitation of Liability of Owner Trustee and Indenture
Trustee...........................................36
SECTION 10.12. Waiver....................................................37
SECTION 10.13. Separate Corporate Existence..............................37
SECTION 10.14. Submission to Jurisdiction................................39
SECTION 10.15. Tax Treatment.............................................40
APPENDIX A Definitions (Section 1.01)
SCHEDULE A Schedule of Receivables
SCHEDULE B Location of the Receivable Files (Section 3.03(b))
EXHIBIT A Form of Monthly Payment Date Statement to Noteholders
(Section 5.08)
EXHIBIT B Form of Servicer's Certificate (Section 4.09)
EXHIBIT C Final Certification of Custodian (Section 3.02)
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TRANSFER AND SERVICING AGREEMENT dated as of March 1, 1999 (this
"Agreement") among DISTRIBUTION FINANCIAL SERVICES RV TRUST 1999-1, a New York
common law trust (the "Issuer"), DEUTSCHE RECREATIONAL ASSET FUNDING
CORPORATION, a Nevada corporation, as Depositor (the "Depositor"), and DEUTSCHE
FINANCIAL SERVICES CORPORATION, a Nevada corporation ("DFS"), as Servicer.
WHEREAS, the Issuer desires to acquire Receivables from the Depositor;
WHEREAS, the Depositor is willing to contribute such Receivables to the
Issuer; and
WHEREAS, the Depositor acquired such Receivables from the Transferor
pursuant to the Ganis/Depositor Transfer Agreement, and the Transferor acquired
certain of such Receivables from DFS pursuant to the DFS/Ganis Transfer
Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. Except as otherwise specified herein or as
the context may otherwise require, capitalized terms used herein (including in
the recitals hereto) have the respective meanings assigned thereto in Appendix A
for all purposes of this Agreement.
SECTION 1.02. Other Definitional Provisions.
(a) All terms defined in Appendix A attached hereto shall have the
defined meanings when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein.
(b) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto, accounting terms not defined in this
Agreement or in any such certificate or other document, and accounting terms
partly defined in this Agreement or in any such certificate or other document to
the extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles. To the extent that the definitions of
accounting terms in this Agreement or in any such certificate or other document
are inconsistent with the meanings of such terms under generally accepted
accounting principles, the definitions contained in this Agreement or in any
such certificate or other document shall control.
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(c) The words "hereof", "herein", "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Article, Section, Schedule
and Exhibit references contained in this Agreement are references to Articles,
Sections, Schedules and Exhibits in or to this Agreement unless otherwise
specified; and the term "including" shall mean "including without limitation".
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred to herein
or in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, amended and
restated or otherwise modified and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments incorporated
therein; references to a Person are also to its permitted successors and
assigns.
(f) Each reference to the "close of business" on a particular day shall
mean 5:00 p.m. Pacific Time on such day.
ARTICLE II
Contribution of Receivables
SECTION 2.01. Contribution. The Depositor does hereby transfer, assign,
set over and otherwise convey to the Issuer, as a capital contribution, without
recourse (subject to the obligations of the Depositor set forth herein), all
right, title and interest of the Depositor in, to and under (but none of the
obligations of the Depositor under):
(a) the Receivables, the DFS/Ganis Transfer Agreement and the
other Transferor Conveyed Property;
(b) the Ganis/Depositor Transfer Agreement; and
(c) the proceeds of any and all of the foregoing.
The Receivables and other items covered by clauses (a)-(c) of this
Section 2.01 shall be referred to collectively as the "Depositor Conveyed
Property".
SECTION 2.02. Intent of the Parties.
(a) The Depositor and the Issuer intend that the conveyance by the
Depositor to the Issuer of the right, title and interest of the Depositor in, to
and under the Receivables and the
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other Depositor Conveyed Property pursuant to this Agreement shall constitute a
capital contribution and not a loan. However, in the event that, notwithstanding
the intent of the parties, such conveyance is deemed to be a transfer for
security and not a capital contribution, then (i) the Depositor shall be deemed
to have granted, and in such event does hereby grant, to the Issuer a first
priority security interest in all of its right, title and interest in, to and
under the Depositor Conveyed Property, and (ii) this Agreement shall constitute
a security agreement under applicable law with respect to such conveyance. If
such conveyance is deemed to be a transfer for security and not a capital
contribution, the Depositor consents to the Issuer hypothecating and
transferring such security interest in favor of any assignee or assignees and
transferring the obligations secured thereby to such assignee or assignees.
(b) No party hereto shall take any action that is inconsistent with the
ownership of the Depositor Conveyed Property by the Issuer, and each party
hereto shall inform any Person inquiring about the Receivables that the Issuer
owns the Depositor Conveyed Property. Without limiting the generality of the
foregoing, for accounting, tax and other purposes the Depositor and the Issuer
shall treat the transfer of the Depositor Conveyed Property by the Depositor to
the Issuer as a capital contribution by the Depositor to the Issuer.
Notwithstanding any other provision of this Agreement, no Person shall have any
recourse to DFS, the Transferor, the Depositor or the Servicer on account of the
financial inability of any Obligor to make payments in respect of a Receivable.
ARTICLE III
The Receivables
SECTION 3.01. Representations and Warranties with Respect to the
Receivables. DFS has made the representations and warranties set forth in
Section 3.01 of the DFS/Ganis Transfer Agreement, and has consented to the
assignment by the Transferor to the Depositor and by the Depositor to the Issuer
of the Transferor's rights with respect thereto. The Transferor has made the
representations and warranties set forth in Section 3.01 of the Ganis/Depositor
Transfer Agreement, and has consented to the assignment by the Depositor to the
Issuer of the Depositor's rights with respect thereto. Pursuant to Section 2.01
of this Agreement, the Depositor has transferred to the Issuer all of the
Depositor's right, title and interest in, to and under the DFS/Ganis Transfer
Agreement and the Ganis/Depositor Transfer Agreement, which shall be understood
to include the representations and warranties of DFS and the Transferor therein,
upon which the Issuer relies in accepting the Receivables, together with all
rights of the Depositor with respect to any breach thereof, including the right
to require DFS or the Transferor, as the case may be, to purchase Receivables in
accordance with the DFS/Ganis Transfer Agreement or the Ganis/Depositor
Transferor Agreement, as the case may be.
The Depositor makes the following representations and warranties as to
the Receivables on which the Issuer is deemed to have relied in acquiring the
Receivables. Such representations
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and warranties speak as of the execution and delivery of this Agreement and as
of the Closing Date, but shall survive the transfer and assignment of the
Receivables to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture.
(a) Title. No Receivable has been sold, transferred, assigned or
pledged by the Depositor to any Person other than the Issuer. Immediately prior
to the transfer and assignment by the Depositor to the Issuer, the Depositor had
good and marketable title to each Receivable, free and clear of all Liens and,
immediately upon the transfer thereof, the Issuer shall have good and marketable
title to each Receivable, free and clear of all Liens; and such transfer has
been perfected under the UCC.
(b) All Filings Made. All filings (including UCC filings) necessary in
any jurisdiction to give (i) the Issuer a first perfected ownership interest in
the Receivables and (ii) the Indenture Trustee a first perfected security
interest in the Receivables have been made.
Upon discovery by the Depositor, the Servicer, the Owner Trustee or the
Indenture Trustee of a breach of any of the representations and warranties of
the Depositor set forth in this Section, of the Transferor set forth in Section
3.01 of the Ganis/Depositor Transfer Agreement or of DFS set forth in Section
3.01 of the DFS/Ganis Transfer Agreement, in each case which materially and
adversely affects the value of the Receivables or the interest therein of the
Issuer or the Indenture Trustee (or which materially and adversely affects the
interest of the Issuer or the Indenture Trustee in the related Receivable in the
case of a representation and warranty relating to a particular Receivable), the
Person discovering such breach shall give prompt written notice to the other
parties hereto. On the last day of the Collection Period following the
Collection Period during which the Depositor discovers or receives notice of any
such breach of any such representation or warranty, if such breach shall not
have been cured in all material respects by such last day, then the Depositor
shall purchase (and, if applicable, the Depositor shall enforce the obligation
of DFS, under the DFS/Ganis Transfer Agreement, or Ganis, under the
Ganis/Depositor Transfer Agreement, to purchase) such Receivable from the Issuer
as of such last day at a price equal to the Purchase Amount of such Receivable,
which price the Depositor shall remit in the manner specified in Section 5.05;
provided that this section is subject to the longer time period for a breach of
Section 3.01(xiii) of the DFS/Ganis Transfer Agreement and Section 3.01(xiii) of
the Ganis/Depositor Transfer Agreement set forth in Section 3.01 of such
agreements; provided, further, however, that the obligation of the Depositor to
purchase any Receivable that arises as a result of a breach of the
representations and warranties of DFS or the Transferor under the DFS/Ganis
Transfer Agreement or the Ganis/Depositor Agreement, as the case may be, is
subject to the payment of the Purchase Amount by DFS or the Transferor in
accordance with the DFS/Ganis Transfer Agreement or the Ganis/Depositor Transfer
Agreement, as the case may be. Subject to the indemnification provisions
contained in the last paragraph of this Section, the sole remedy of the Issuer,
the Owner Trustee, the Indenture Trustee, the Residual Interestholder and the
Noteholders with respect to a breach of representations and warranties of the
Depositor set forth in this Section shall be to require the Depositor to
purchase Receivables pursuant to this Section, subject to the
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conditions contained herein; provided that this Section shall not limit the
right of the Servicer, the Owner Trustee or the Indenture Trustee to enforce (or
to cause the Depositor to enforce) the obligation of DFS or the Transferor to
purchase Receivables pursuant to the DFS/Ganis Transfer Agreement or the
Ganis/Depositor Transfer Agreement, as the case may be.
The Depositor shall indemnify the Issuer, the Owner Trustee and the
Indenture Trustee and hold each harmless against any loss, damages, penalties,
fines, forfeitures, legal fees and related costs, judgments, and other costs and
expenses resulting from any claim, demand, defense or assertion based on or
grounded upon, or resulting from, a breach of the Depositor's representations
and warranties contained in this Agreement; provided that the Depositor shall
not be liable for any indirect damages or for any loss, damage, penalty, fine,
forfeiture, legal fees and related costs, judgments and other costs and expenses
caused by the wilful misconduct of the Issuer, the Owner Trustee or the
Indenture Trustee.
SECTION 3.02. Custody of Receivable Files. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Issuer hereby
revocably appoints the Servicer, and the Servicer hereby accepts such
appointment, to act for the benefit of the Issuer and the Indenture Trustee as
custodian of the following documents or instruments which are hereby or shall
hereby be constructively delivered to the Indenture Trustee, as pledgee of the
Issuer, as of the Closing Date with respect to each Receivable:
(a) the fully executed original Receivable;
(b) a fully executed assignment of the Receivable in blank or from the
related Dealer to DFS or the Transferor, as the case may be, if such Receivable
was acquired by DFS or the Transferor, as the case may be, from a Dealer.
(c) a certificate of physical damage insurance, application form for
such insurance signed by the Obligor or a signed representation letter from the
Obligor named in the Receivable pursuant to which the Obligor has agreed to
obtain physical damage insurance for the Financed Vehicle, or copies thereof;
(d) the Lien Certificate or application therefor or a certification
from the Servicer that it has received confirmation from an authorized official
of the appropriate governmental office of the existence of the first lien of DFS
or the Transferor with respect to the related Financed Vehicle; and
(e) a credit application signed by the Obligor, or a copy thereof.
Within 120 days after the Closing Date, the Servicer, as custodian,
shall ascertain whether all of the Receivable Files are in its possession, and
shall deliver to the Indenture Trustee a certification ("Final Certification")
substantially in the form attached as Exhibit C hereto. During the term of this
Agreement, in the event the Servicer, as custodian, discovers any
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defect with respect to the Receivable File, the Servicer, as custodian, shall
give written specification of such defect to the Indenture Trustee.
SECTION 3.03. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer shall hold the Receivable Files as
custodian for the benefit of the Issuer and the Indenture Trustee and maintain
such accurate and complete accounts, records and computer systems pertaining to
each Receivable File as shall enable the Issuer to comply with this Agreement.
In performing its duties as custodian the Servicer shall act with reasonable
care, using that degree of skill and attention that the Servicer exercises with
respect to the receivable files relating to all comparable recreational vehicle
receivables that the Servicer services for itself or others. The Servicer shall
conduct, or cause to be conducted, periodic audits of the Receivable Files held
by it under this Agreement and of the related accounts, records and computer
systems, in such a manner as shall enable the Issuer or the Indenture Trustee to
verify the accuracy of the Servicer's record keeping. The Servicer shall
promptly report to the Issuer and the Indenture Trustee any failure on its part
to hold the Receivable Files and maintain its accounts, records and computer
systems as herein provided and shall promptly take appropriate action to remedy
any such failure.
(b) Maintenance of and Access to Records. The Servicer shall maintain
each Receivable File at its office specified in Schedule B or at such other
office as shall be specified to the Issuer and the Indenture Trustee by written
notice not later than 90 days after any change in location. The Servicer shall
make available to the Issuer and the Indenture Trustee or their respective duly
authorized representatives, attorneys or auditors a list of locations of the
Receivable Files, and access to such Receivable Files and the related accounts,
records and computer systems maintained by the Servicer at such times during
normal business hours as the Issuer or the Indenture Trustee shall instruct.
Access to Receivable Files by Noteholders, Note Owners and the Residual
Interestholder is covered by Section 4.12. Nothing in this Section shall affect
the obligation of the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors and the failure of the Servicer
to provide access to information as a result of such obligation shall not
constitute a breach of this Section.
(c) Release of Documents. Upon written instruction from the Indenture
Trustee, the Servicer shall release any Receivable File to the Indenture
Trustee, the Indenture Trustee's agent or the Indenture Trustee's designee, as
the case may be, at such place or places as the Indenture Trustee may designate,
as soon as practicable following the Servicer's receipt of such written
instruction.
SECTION 3.04. Instructions; Authority To Act. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable Files
upon its receipt of written instructions signed by a Trust Officer of the
Indenture Trustee.
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SECTION 3.05. Custodian's Indemnification. The Servicer as custodian
shall indemnify the Trust, the Owner Trustee and the Indenture Trustee and each
of their respective officers, directors, employees and agents for any and all
liabilities, obligations, losses, compensatory damages, payments, costs or
expenses of any kind whatsoever that may be imposed on, incurred by or asserted
against the Trust, the Owner Trustee or the Indenture Trustee or any of their
respective officers, directors, employees and agents as the result of any
improper act or omission in any way relating to the maintenance and custody of
the Receivable Files by the Servicer as custodian thereof; provided, however,
that the Servicer shall not be liable to the Owner Trustee for any portion of
any such amount resulting from the willful misfeasance, bad faith or negligence
of the Owner Trustee, and the Servicer shall not be liable to the Indenture
Trustee for any portion of any such amount resulting from the willful
misfeasance, bad faith or negligence of the Indenture Trustee.
SECTION 3.06. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Cutoff Date and shall
continue in full force and effect until terminated pursuant to this Section. If
DFS shall resign as Servicer in accordance with Article VII of this Agreement or
if all of the rights and obligations of any Servicer shall have been terminated
pursuant to Section 8.01, the appointment of such Servicer as custodian shall be
terminated by the Indenture Trustee or by the Holders of Notes evidencing not
less than 25% of the Outstanding Amount of the Notes (or, if Notes have been
paid in full, by the Owner Trustee or by the Residual Interestholder, in the
same manner as the Indenture Trustee or such Holders of Notes may terminate the
rights and obligations of the Servicer under Section 8.01). The Indenture
Trustee or, with the consent of the Indenture Trustee, the Owner Trustee may
terminate the Servicer's appointment as custodian, with cause, at any time upon
written notification to the Servicer and, without cause, upon 30 days' prior
written notification to the Servicer. As soon as practicable after any
termination of such appointment, the Servicer shall deliver the Receivable Files
to the Indenture Trustee or the Indenture Trustee's agent at such place or
places as the Indenture Trustee may reasonably designate.
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.01. Duties of Servicer. The Servicer, for the benefit of the
Issuer (to the extent provided herein), shall manage, service, administer and
make collections on the Receivables (other than Purchased Receivables) with
reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to all comparable recreational vehicle receivables that
it services for itself or others. The Servicer's duties shall include collection
and posting of all payments, responding to inquiries of Obligors on such
Receivables, investigating delinquencies, sending payment coupons to Obligors,
reporting tax information to Obligors, accounting for collections, furnishing
monthly and annual statements to the Owner Trustee and the Indenture Trustee
with respect to distributions and making Advances pursuant to Section
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5.04. Subject to the provisions of Section 4.02, the Servicer shall follow its
customary standards, policies and procedures in performing its duties as
Servicer. Without limiting the generality of the foregoing, the Servicer is
authorized and empowered to execute and deliver, on behalf of itself, the
Issuer, the Owner Trustee, the Indenture Trustee, the Noteholders, the Residual
Interestholder or any of them, any and all instruments of satisfaction or
cancellation, or partial or full release or discharge, and all other comparable
instruments, with respect to such Receivables or to the Financed Vehicles
securing such Receivables. If the Servicer shall commence a legal proceeding to
enforce a Receivable, the Issuer (in the case of a Receivable other than a
Purchased Receivable) shall thereupon be deemed to have automatically assigned,
solely for the purpose of collection, such Receivable to the Servicer. If in any
enforcement suit or legal proceeding it shall be held that the Servicer may not
enforce a Receivable on the grounds that it shall not be a real party in
interest or a holder entitled to enforce such Receivable, the Owner Trustee
shall, at the Servicer's expense and direction, take steps to enforce such
Receivable, including bringing suit in its name or the name of the Owner
Trustee, the Indenture Trustee, the Residual Interestholder or the Noteholders.
The Owner Trustee shall upon the written request of the Servicer furnish the
Servicer with any powers of attorney and other documents reasonably necessary or
appropriate to enable the Servicer to carry out its servicing and administrative
duties hereunder.
SECTION 4.02. Collection and Application of Receivable Payments. The
Servicer shall make reasonable efforts to collect all payments called for under
the terms and provisions of the Receivables as and when the same shall become
due and shall follow such collection procedures as it follows with respect to
all comparable recreational vehicle receivables that it services for itself or
others. Subject to the foregoing, the Servicer may grant extensions, rebates or
adjustments on a Receivable, which shall not, for the purposes of this
Agreement, modify the original due dates (except that DFS as Servicer may, for
administrative purposes, modify the due date of a Receivable to a different date
in the same month, which date shall be reflected in its servicing records) or
amounts of the originally scheduled payments of interest on Receivables;
provided, however, that if the Servicer extends the date for final payment by
the Obligor of any Receivable beyond the Final Scheduled Maturity Date, it shall
promptly purchase the Receivable from the Issuer in accordance with the terms of
Section 4.07. The Servicer may in its discretion waive any late payment charge
or any other fees that may be collected in the ordinary course of servicing a
Receivable. The Servicer shall not agree to any alteration of the interest rate
or the originally scheduled payments on any Receivable. The Servicer shall apply
payments by or on behalf of Obligors in accordance with Section 5.03.
SECTION 4.03. Realization upon Receivables. On behalf of the Issuer,
the Servicer shall use its best efforts, consistent with its customary servicing
procedures, to repossess or otherwise convert the ownership of the Financed
Vehicles securing any Receivable as to which the Servicer shall have determined
eventual payment in full is unlikely. The Servicer shall follow such customary
and usual practices and procedures as it shall deem necessary or advisable in
its servicing of the Receivables, which may include reasonable efforts to
realize upon any recourse to Dealers and selling the Financed Vehicle at public
or private sale. The Servicer shall be
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entitled to reimbursement out of recoveries on such Defaulted Receivable for its
reasonable, out-of-pocket costs and expenses incurred in realizing upon any
Financed Vehicle securing any Receivable that becomes a Defaulted Receivable or
in attempting to repossess any Financed Vehicle and in prosecuting legal action
against any Obligor in respect of any Receivable. The foregoing shall be subject
to the provision that, in any case in which the Financed Vehicle shall have
suffered damage, (i) the Servicer shall not expend funds in connection with the
repair or the repossession of such Financed Vehicle unless it shall determine in
its discretion that such repair and/or repossession shall increase the
Liquidation Proceeds by an amount greater than the amount of its expenses in
connection with such repair and/or repossession, and (ii) the Servicer may,
subject to Section 4.01, allow Obligors to use the proceeds of the applicable
Insurance Policy to repair or replace such Financed Vehicle rather than to
prepay the related Receivable.
SECTION 4.04. Physical Damage Insurance. The Servicer shall, in
accordance with its customary servicing procedures, require that each Obligor
shall have obtained physical damage insurance covering the Financed Vehicle as
of the execution of the Receivable.
SECTION 4.05. Maintenance of Security Interests in Financed Vehicles.
The Servicer shall, in accordance with its customary servicing procedures, take
such steps as are necessary to maintain perfection of the security interest
created by each Receivable in the related Financed Vehicle. The Servicer is
hereby authorized to take such steps as are necessary to re-perfect such
security interest on behalf of the Issuer and the Indenture Trustee in the event
of the relocation of a Financed Vehicle or for any other reason.
SECTION 4.06. Covenants of Servicer. The Servicer shall not release the
Financed Vehicle securing any Receivable from the security interest granted by
such Receivable in whole or in part (except in the event of payment in full by
the Obligor thereunder or repossession, or except as ordered by a court of
competent jurisdiction), nor shall the Servicer impair the rights of the Issuer,
the Indenture Trustee, the Residual Interestholder or the Noteholders in such
Receivable, nor shall the Servicer increase the number of scheduled payments due
under a Receivable.
SECTION 4.07. Purchase of Receivables upon Breach. The Servicer or the
Owner Trustee shall inform the other party and the Indenture Trustee and the
Depositor promptly, in writing, upon the discovery of any breach of the
Servicer's obligations under Section 4.02, 4.05 or 4.06. Unless the breach shall
have been cured by the last day of the second Collection Period following such
discovery (or, at the Servicer's election, the last day of the first following
Collection Period), the Servicer shall purchase from the Trust any Receivable
materially and adversely affected by such breach as of such last day. If the
Servicer takes any action during any Collection Period pursuant to Section 4.02
that impairs the rights of the Issuer, the Indenture Trustee, the Noteholders or
the Residual Interestholder in any Receivable or as otherwise provided in
Section 4.02, the Servicer shall purchase such Receivable from the Trust as of
the close of business on the last day of such Collection Period. In
consideration of the purchase of any such Receivable pursuant to either of the
two preceding sentences, the Servicer shall remit
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the Purchase Amount in the manner specified in Section 5.05. Subject to Section
7.02, the sole remedy of the Issuer, the Owner Trustee, the Indenture Trustee,
the Noteholders or the Residual Interestholder with respect to a breach pursuant
to Section 4.02, 4.05 or 4.06 shall be to require the Servicer to purchase
Receivables pursuant to this Section. The Owner Trustee and the Indenture
Trustee shall have no duty to conduct any affirmative investigation as to the
occurrence of any condition requiring the purchase of any Receivable pursuant to
this Section.
SECTION 4.08. Servicing Fee. The Servicing Fee for each Monthly Payment
Date shall equal the product of (a) one-twelfth, (b) the Servicing Fee Rate and
(c) the Pool Balance as of the first day of the preceding Collection Period. The
Servicer shall also be entitled to keep all late fees, prepayment charges and
other administrative fees or similar charges provided for under the Receivables
or allowed by applicable law, in each case, to the extent not prohibited by
applicable law, collected (from whatever source) on the Receivables, plus any
reimbursement pursuant to the last paragraph of Section 7.02, plus amounts
distributed from the Reserve Account in accordance with Section 5.07(c).
SECTION 4.09. Servicer's Certificate. At least two Business Days prior
to each Determination Date the Servicer shall provide to the Indenture Trustee
sufficient information relating to the Receivables for the applicable Collection
Period to enable the Indenture Trustee to prepare Section VII of the Servicer's
Certificate. Not later than 11:00 A.M. (New York time) on each Determination
Date, the Servicer shall deliver to the Owner Trustee, each Paying Agent, the
Indenture Trustee and the Depositor, with a copy to the Rating Agencies, a
Servicer's Certificate containing all information necessary to make the
distributions to be made on the related Monthly Payment Date pursuant to
Sections 5.05 and 5.06 for the related Collection Period. Receivables to be
purchased by the Servicer, the Depositor, DFS or the Transferor shall be
identified by the Servicer by account number with respect to such Receivable (as
specified in the Schedule of Receivables).
SECTION 4.10. Annual Statement as to Compliance; Notice of Default.
(a) The Servicer shall deliver to the Owner Trustee and the Indenture
Trustee, on or before March 15 of each year beginning in 2000, an Officer's
Certificate, dated as of December 31 of the preceding year, stating that (i) a
review of the activities of the Servicer during the preceding 12 month period
(or such shorter period as shall have elapsed since the Closing Date) and of its
performance under this Agreement has been made under the supervision of the
officers of the Servicer signing such Officer's Certificate and (ii) to the best
of such officers' knowledge, based on such review, the Servicer has fulfilled
all its obligations under this Agreement throughout such year or, if there has
been a default in the fulfillment of any such obligation, specifying each such
default known to such officers and the nature and status thereof. The Indenture
Trustee shall send a copy of such certificate and the report referred to in
Section 4.11 to the Rating Agencies. A copy of such certificate and the report
referred to in Section 4.11 may be obtained by any Noteholder, Note Owner or the
Residual Interestholder by a request in writing to the Owner Trustee addressed
to the Corporate Trust Office. Upon the telephone
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request of the Owner Trustee, the Indenture Trustee shall promptly furnish the
Owner Trustee a list of Noteholders as of the date specified by the Owner
Trustee.
(b) The Servicer shall deliver to the Owner Trustee, the Indenture
Trustee and the Rating Agencies, promptly after having obtained knowledge
thereof, but in no event later than five (5) Business Days thereafter, written
notice in an Officer's Certificate of any event which is or which with the
giving of notice or lapse of time, or both, would become, a Servicer Default
under Section 8.01(a) or (b).
SECTION 4.11. Annual Independent Certified Public Accountants' Report.
The Servicer shall cause a firm of nationally recognized "independent certified
public accountants" (within the meaning of the Code of Professional Ethics of
the American Institute of Certified Public Accountants), which may also render
other services to the Servicer, the Depositor or their Affiliates, to deliver to
the Owner Trustee and the Indenture Trustee on or before March 15 of each year
beginning in 2000, a report addressed to the Board of Directors of the Servicer,
to the effect that (a) such firm has examined certain documents and records of
the Servicer relating to the servicing of Receivables under this Agreement
during the preceding calendar year (or, in the case of the first such report,
during the period from the Closing Date through the end of 1999), (b) such
examination (i) was made in accordance with generally accepted auditing
standards and accordingly included such tests and auditing procedures as such
firm considered necessary in the circumstances, and (ii) included tests relating
to recreational vehicle loans serviced for others in compliance with the minimum
servicing standards identified in the Mortgage Bankers Association of America's
Uniform Single Attestation Program for Mortgage Bankers (the "Program"), to the
extent such standards are applicable to the servicing obligations set forth in
this Agreement, (c) management of the Servicer has asserted to such firm that
the Servicer has complied with the minimum servicing standards identified in the
Program to the extent that such standards are applicable to the servicing
obligations set forth in this Agreement, and (d) in the opinion of such firm,
such assertion of the Servicer's management is correct (or, if such assertion of
the Servicer's management is not correct, stating why such assertion is not
correct).
SECTION 4.12. Access to Certain Documentation and Information
Regarding Receivables. The Servicer shall provide to the Noteholders, Note
Owners, and the Residual Interestholder access to the Receivable Files in such
cases where the Noteholders, Note Owners, or the Residual Interestholder, as
applicable, shall be required by applicable statutes or regulations to review
such documentation. Access shall be afforded without charge, but only upon
reasonable request and during the normal business hours at the offices of the
Servicer. Nothing in this Section shall affect the obligation of the Servicer to
observe any applicable law prohibiting disclosure of information regarding the
Obligors and the failure of the Servicer to provide access to information as a
result of such obligation shall not constitute a breach of this Section.
The Servicer shall provide to the Noteholders, Note Owners, and the
Residual Interestholder and any supervisory agents or examiners which may relate
to the Noteholders,
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Note Owners, or the Residual Interestholder, including the Office of Thrift
Supervision, the Office of the Comptroller of the Currency or the FDIC and other
similar entities, access to any documentation regarding the Receivables which
may be required by any applicable regulations. Such access shall be afforded
without charge, upon reasonable request, during normal business hours and at the
offices of the Servicer, all in accordance with federal government, the FDIC,
the Office of Thrift Supervision, the Office of the Comptroller of the Currency
or any other similar regulations.
SECTION 4.13. Servicer Expenses. The Servicer shall be required to pay
all expenses incurred by it in connection with its activities hereunder,
including fees and disbursements of independent accountants, taxes imposed on
the Servicer and expenses incurred by the Servicer in connection with
distributions and reports to Noteholders.
SECTION 4.14. Appointment of Subservicer. The Servicer may at any time
appoint a subservicer to perform all or any portion of its obligations as
Servicer hereunder including but not limited to its obligations as custodian as
set forth in Article III hereof. Prior to the appointment of any subservicer
other than the Transferor, the Servicer shall cause the Rating Agency Condition
to have been satisfied in connection therewith. Notwithstanding the appointment
of any subservicer (including but not limited to the Transferor), the Servicer
shall remain obligated and be liable to the Issuer, the Owner Trustee, the
Indenture Trustee, the Noteholders and the Residual Interestholder for the
servicing, administering and custodianship of the Receivables in accordance with
the provisions hereof without diminution of such obligation and liability by
virtue of the appointment of such subservicer and to the same extent and under
the same terms and conditions as if the Servicer alone were servicing and
administering and acting as custodian of the Receivables. The fees and expenses
of the subservicer shall be as agreed between the Servicer and its subservicer
from time to time, and none of the Issuer, the Owner Trustee, the Indenture
Trustee, the Noteholders or the Residual Interestholder shall have any
responsibility therefor.
SECTION 4.15. Fidelity Bond; Errors and Omissions Insurance. The
Servicer shall maintain, at its own expense, a blanket fidelity bond and an
errors and omissions insurance policy, with broad coverage with responsible
companies on all officers, employees or other persons acting in any capacity
with regard to the Receivables to handle funds, money, documents and papers
relating to the Receivables. Any such fidelity bond and errors and omissions
insurance shall protect and insure the Servicer against losses, including
forgery, theft, embezzlement, fraud, errors and omissions and negligent acts of
such persons. Such fidelity bond shall also protect and insure the Servicer
against losses in connection with any failure to maintain insurance policies
required pursuant to this Agreement and the release or satisfaction of a
Receivable without having obtained payment in full of the indebtedness secured
thereby. No provision of this Section 4.15 requiring such fidelity bond and
errors and omissions insurance shall diminish or relieve the Servicer from its
duties and obligations as set forth in this Agreement. The coverage under any
such bond and insurance policy shall be in such amounts as are customary for the
business of servicing recreational vehicle receivables.
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ARTICLE V
Distributions; Statements to Noteholders
SECTION 5.01. Establishment of Trust Accounts.
(a)(i) The Servicer, for the benefit of the Noteholders and
the Residual Interestholder, shall establish and maintain in the name
of the Indenture Trustee an Eligible Deposit Account (the "Collection
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Noteholders and
Residual Interestholder.
(ii) The Indenture Trustee, for the benefit of the
Noteholders, shall establish and maintain in the name of the Indenture
Trustee an Eligible Deposit Account (the "Note Distribution Account"),
bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Noteholders.
(iii) The Servicer, for the benefit of the Noteholders and the
Servicer, shall establish and maintain in the name of the Indenture
Trustee an Eligible Deposit Account (the "Reserve Account"), bearing a
designation clearly indicating that the funds deposited therein are
held for the benefit of the Noteholders and the Servicer.
(b) Subject to Section 8.03 of the Indenture, funds on deposit in the
Collection Account and the Reserve Account (the Collection Account and the
Reserve Account being referred to collectively, with the Note Distribution
Account, as the "Trust Accounts") shall be invested by the Indenture Trustee in
Eligible Investments selected in writing by the Servicer, in each case pursuant
to a direction of the Servicer which shall contain a certification that the
requested investment constitutes an Eligible Investment and is permitted to be
made hereby by the Indenture Trustee. It is understood and agreed that the
Indenture Trustee shall not be liable for any loss arising from an investment in
Eligible Investments made in accordance with this Section 5.01(b) except to the
extent that the Indenture Trustee is the obligor of such Eligible Investments,
unless such loss is occasioned by a reduction in the market price of such
investment and not by default of the Indenture Trustee in its capacity as
obligor. All such Eligible Investments shall be held by the Indenture Trustee
for the benefit of the Noteholders and the Residual Interestholder (or for such
of such holders for whose benefit the applicable account is maintained). All
Investment Earnings with respect to amounts on deposit in a Trust Account shall
be added to the balance of funds on deposit in such Trust Account, subject to
application of funds on deposit in such Trust Account pursuant to the applicable
Basic Document. Other than as permitted by the Rating Agencies, funds on deposit
in the Collection Account and the Reserve Account shall be invested in Eligible
Investments that shall mature (A) not later than the
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Business Day immediately preceding the next Monthly Payment Date or (B) on such
next Monthly Payment Date if either (x) such investment is held in the trust
department of the institution with which each of the Collection Account and the
Reserve Account is then maintained and is invested in a time deposit of such
institution that is rated at least A-1 by Standard & Poor's and F1+ by Fitch or
(y) DFS (so long as the short-term unsecured debt obligations of DFS are either
(i) rated at least F1+ by Fitch and A-1 by Standard & Poor's on the date such
investment is made or (ii) guaranteed by an entity whose short-term unsecured
debt obligations are rated at least F1+ by Fitch and A-1 by Standard & Poor's on
the date such investment is made) has agreed to advance funds on such Monthly
Payment Date to the Note Distribution Account in the amount payable on such
investment on such Monthly Payment Date pending receipt thereof to the extent
necessary to make distributions on such Monthly Payment Date. The guarantee
referred to in clause (y) of the preceding sentence shall be subject to the
Rating Agency Condition. For the purpose of the foregoing, unless DFS
affirmatively agrees in writing with the Indenture Trustee to make such advance
with respect to such investment prior to the time an investment is made, it
shall not be deemed to have agreed to make such advance. Funds deposited in a
Trust Account on a day which immediately precedes a Monthly Payment Date upon
the maturity of any Eligible Investments are not required to be invested
overnight. Funds on deposit in the Note Distribution Account shall not be
invested.
(c)(i) The Indenture Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Trust Accounts and in
all proceeds thereof (including all income thereon) and all such funds,
investments, proceeds and income shall be part of the Trust Estate. The Trust
Accounts shall be under the sole dominion and control of the Indenture Trustee
for the benefit of the Noteholders and the Residual Interestholder (or for such
of such holders for whose benefit the applicable account is maintained). If, at
any time, any of the Trust Accounts ceases to be an Eligible Deposit Account,
the Indenture Trustee (or the Servicer on its behalf) shall within 10 Business
Days (or such longer period, not to exceed 30 calendar days, as to which each
Rating Agency may consent) establish a new Trust Account as an Eligible Deposit
Account and shall transfer any cash and/or any investments to such new Trust
Account.
(ii) With respect to the Trust Account Property, the Indenture Trustee
agrees, by its acceptance hereof, that:
(A) any Trust Account Property that is held in
deposit accounts shall be held solely in the Eligible Deposit
Accounts, subject to the last sentence of Section 5.01(c)(i);
and each such Eligible Deposit Account shall be subject to the
exclusive custody and control of the Indenture Trustee, and
the Indenture Trustee shall have sole signature authority with
respect thereto;
(B) any Trust Account Property that constitutes a
Certificated Item (other than a Clearing Corporation Item,
Euroclear Item or Cedel Item) or Instrument shall be
registered in the name of the Indenture Trustee or endorsed to
the Indenture Trustee or in blank by an authorized person,
with signature
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guaranteed, and the Indenture Trustee shall maintain
continuous possession of such Certificated Item or Instrument
on behalf of the Trust in the State of New York;
(C) any Trust Account Property that constitutes an
Uncertificated Item (except those Uncertificated Items
consisting of Clearing Corporation Items) shall be
continuously registered on the books of the issuer thereof to
the Indenture Trustee;
(D) in the case of any Trust Account Property that
constitutes a Clearing Corporation Item, the Indenture Trustee
shall cause (i) the relevant Clearing Corporation to make
appropriate entries on its books increasing the appropriate
securities account of the Indenture Trustee at such Clearing
Corporation by the amount of such Clearing Corporation Item,
and (ii) such Clearing Corporation Item to be (1) continuously
registered to the Clearing Corporation or its custodian or the
nominee of either subject to the exclusive control of such
Clearing Corporation (in the case of a Clearing Corporation
Item that is an Uncertificated Item) or continuously
maintained in the State of New York in the possession of such
Clearing Corporation or its custodian or the nominee of either
subject to the exclusive control of such Clearing Corporation
(in the case of a Clearing Corporation Item that is a
Certificated Item), and (2) continuously identified on the
books and records of such Clearing Corporation for the sole
and exclusive account of the Indenture Trustee;
(E) in the case of any Trust Account Property that
constitutes a Euroclear Item, the Indenture Trustee shall
cause (i) Euroclear to make appropriate entries on its books
increasing the appropriate securities account of the Indenture
Trustee's client securities account at Euroclear and to send
confirmation to the Indenture Trustee that Euroclear is
holding such Euroclear Item for the account of the Indenture
Trustee, and (ii) such Euroclear Item to be (1) continuously
registered to Euroclear, and (2) continuously identified on
the books and records of Euroclear for the sole and exclusive
account of the Indenture Trustee;
(F) in the case of any Trust Account Property that
constitutes a Cedel Item, the Indenture Trustee shall cause
(i) Cedel to make appropriate entries on its books
transferring each such Cedel Item to the Indenture Trustee's
client securities account at Cedel and to send confirmation to
the Indenture Trustee that Cedel is holding such Cedel Item
for the account of the Indenture Trustee, and (ii) such Cedel
Item to be (1) continuously registered to Cedel, and (2)
continuously identified on the books and records of Cedel for
the sole and exclusive account of the Indenture Trustee;
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(G) in the case of any Trust Account Property that
constitutes a Government Item, the Indenture Trustee shall
cause (i) the transfer of such Government Item to one or more
book-entry accounts for the Indenture Trustee at the Federal
Reserve Bank of New York, and (ii) such Government Item to be
continuously identified in one or more book-entry accounts for
the Indenture Trustee at the Federal Reserve Bank of New York;
and
(H) without limiting the foregoing, the Servicer
shall instruct the Indenture Trustee to take such different or
additional action as may be, based on an Opinion of Counsel of
the Servicer, reasonably appropriate in order to maintain the
perfection and priority of the security interest of the
Indenture Trustee in the Trust Account Property under
applicable law, including Articles 8 and 9 of the UCC and
regulations of the U.S. Department of the Treasury governing
transfers of interests in Government Items, and the Indenture
Trustee shall cooperate with the Servicer in connection
therewith.
(iii) The Servicer shall have the power, revocable by the
Indenture Trustee or by the Owner Trustee with the consent of the
Indenture Trustee, to make withdrawals and payments from the Trust
Accounts (other than the Note Distribution Account) for the purpose of
permitting the Servicer or the Owner Trustee to carry out its
respective duties hereunder or permitting the Indenture Trustee to
carry out its duties under the Indenture.
All references in this Section 5.01 (or in terms defined in Appendix A
and used without definition in this Section 5.01) to the UCC shall be to the UCC
as in effect in the State of New York, as amended from time to time.
SECTION 5.02. Collections. (a) The Servicer shall remit within two
Business Days of receipt thereof to the Collection Account all payments by or on
behalf of the Obligors with respect to the Receivables (other than Purchased
Receivables) and all Liquidation Proceeds, both as collected during each
Collection Period. For purposes of this Article V the phrase "payments by or on
behalf of Obligors" shall mean payments made with respect to the Receivables or
the Financed Vehicles by Persons other than the Servicer, DFS, the Transferor or
the Depositor.
(b) Notwithstanding anything in this Agreement to the
contrary, if (i) DFS is the Servicer, (ii) no Servicer Default has
occurred and is continuing and (iii) (x) DFS arranges for and maintains
a letter of credit or other form of credit enhancement for the benefit
of the Trust in respect of the Servicer's obligations to make deposits
of payments and Liquidation Proceeds in the Collection Account that is
acceptable in form and substance to each Rating Agency or (y) DFS
otherwise obtains the Rating Agency confirmations described below,
then, subject to any limitations in the confirmations described below,
the Servicer need not make the daily deposits of payments and
Liquidation Proceeds into the Collection Account as provided in Section
5.02(a), but may make a single deposit into the Collection Account in
same-day funds not later than
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2:00 p.m., New York City time, on each Determination Date in a net
amount equal to the amount which would have been on deposit with
respect to the immediately preceding Collection Period in the
Collection Account; provided, however, that prior to ceasing daily
deposits as described in Section 5.02(a) the Servicer shall have
delivered to the Indenture Trustee (i) written confirmation from each
of the Rating Agencies that the failure by DFS to make daily deposits
shall not result in a qualification, reduction or withdrawal of the
rating of any outstanding Notes and (ii) a certificate of a vice
president or other officer of the Servicer stating that all conditions
described in this paragraph to the cessation of the Servicer's duty to
make daily deposits have been satisfied. If (i) DFS is no longer the
Servicer, (ii) a Servicer Default has occurred and is continuing, (iii)
any Rating Agency shall notify the Servicer that the letter of credit
or other form of credit enhancement described in the previous sentence
is not satisfactory to such Rating Agency or (iv) any Rating Agency
shall revoke its confirmation described in the previous sentence or DFS
shall fail to comply with any limitations in any such confirmation,
then (x) the Servicer shall comply with Section 5.02(a) until such time
as the conditions described in the previous sentence have been
satisfied and (y) DFS promptly shall notify the Indenture Trustee as to
the failure of such conditions to be satisfied.
(c) If (i) the Servicer makes a deposit into the Collection
Account in respect of a payment of a Receivable and such payment was
received by the Servicer in the form of a check which is not honored
for any reason or (ii) the Servicer makes a mistake with respect to the
amount of any payment and deposits an amount that is less than or more
than the actual amount of such payment, the Servicer shall
appropriately adjust the amount subsequently deposited into the
Collection Account to reflect such dishonored check or mistake. Any
Receivable in respect of which a dishonored check is received shall be
deemed not to have been paid.
(d) As an administrative convenience, unless the Servicer is
required to remit payments daily pursuant to Section 5.02(a) (taking
into effect Section 5.02(b)), the Servicer may make the deposit of
payments by or on behalf of Obligors, Advances and Purchase Amounts for
or with respect to the related Collection Period out of distributions
to be made to the Servicer with respect to such Collection Period.
However, the Servicer shall account to the Owner Trustee, the Indenture
Trustee, the Noteholders and the Residual Interestholder as if all
deposits, distributions and transfers were made individually.
SECTION 5.03. Application of Collections. All payments by or on behalf
of Obligors for any Collection Period shall be applied by the Servicer as
follows: (a) first, payments by or on behalf of the Obligors (other than with
respect to Purchased Receivables) shall be applied to reduce Outstanding
Advances to the extent described in Section 5.04; and (b) second, any excess
shall be applied to interest and principal on the Receivables in accordance with
the Simple Interest Method; and (c) third, any remaining amounts shall be
applied to any late fees and other charges in accordance with the customary
servicing procedures that the Servicer
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follows with respect to all comparable recreational vehicle receivables that it
services for itself or others.
SECTION 5.04. Advances. As of the close of business on the last day of
each Collection Period, subject to the last sentence of this Section, the
Servicer shall advance an amount equal to the amount of interest due on the
Receivables at their respective APRs for such Collection Period (assuming the
Receivables pay on their respective due dates) minus the amount of interest
actually received by the Servicer on the Receivables during such Collection
Period (such amount, an "Advance"). With respect to each Receivable, the Advance
shall increase Outstanding Advances. If such calculation (i.e., the subtraction
of the amount of interest due on the Receivables at their respective APRs for
the related Collection Period (assuming the Receivables pay on their respective
due dates) from the amount of interest actually received on the Receivables
during the related Collection Period) results in a negative number, an amount
equal to the absolute value of such negative number shall be paid to the
Servicer (out of funds that otherwise would be deposited in the Collection
Account) and the amount of Outstanding Advances shall be reduced by such amount,
in each case in accordance with Section 5.03. In addition, in the event that a
Receivable becomes a Defaulted Receivable, Liquidation Proceeds with respect to
such Receivable attributable to accrued and unpaid interest thereon (but not
including interest for the then current Collection Period) shall be paid to (or
retained by) the Servicer (out of funds that otherwise would be deposited in the
Collection Account) to reduce Outstanding Advances.
Notwithstanding the foregoing, the Servicer shall not make any Advance:
(i) unless the Servicer, in its sole discretion, believes that the Servicer
shall be reimbursed for such Advance as contemplated by this Section; (ii) in
respect of principal of the Receivables; or (iii) in respect of a Defaulted
Receivable or a Purchased Receivable.
SECTION 5.05. Additional Deposits. The Servicer shall deposit in the
Collection Account on or before 2:00 p.m. New York time on the Determination
Date following each Collection Period the related Advance pursuant to Section
5.04. The Servicer and the Depositor shall deposit or cause to be deposited in
the Collection Account the aggregate Purchase Amount with respect to Purchased
Receivables and the Servicer shall deposit therein all amounts to be paid under
Section 9.01, in each case on or prior to 2:00 p.m. New York time on the
Determination Date following the Collection Period as of which such purchase is
made by the Servicer, DFS, the Transferor or the Depositor, as the case may be.
In addition, any other deposits required to be made by the Depositor or the
Servicer to the Collection Account and which are not otherwise provided for by
Section 5.02 or by the other provisions of this Section 5.05 shall be made on or
prior to 2:00 p.m. New York time on the Determination Date following the related
Collection Period.
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SECTION 5.06. Distributions.
(a)(i) On each Determination Date, the Servicer shall
calculate all amounts required to be deposited in the Note Distribution
Account and the Residual Interestholder Distribution Account.
(ii) On each Monthly Payment Date, the Servicer shall instruct
the Indenture Trustee (based on the information contained in the
Servicer's Certificate delivered on the related Determination Date
pursuant to Section 4.09) to make, and the Indenture Trustee shall
make, the following deposits and distributions from amounts on deposit
in the Collection Account for receipt by the Servicer or deposit in the
applicable account by 11:00 a.m. (New York time) on such Monthly
Payment Date, to the extent of the Total Distribution Amount, in the
following order of priority:
(A) to the Servicer (if DFS is no longer the
Servicer), the Servicing Fee and all unpaid Servicing Fees
from prior Collection Periods;
(B) to the Note Distribution Account, from the Total
Distribution Amount remaining after the application of clause
(A), the Noteholders' Interest Distributable Amount;
(C) to the Note Distribution Account, from the Total
Distribution Amount remaining after the application of clauses
(A) and (B), the Noteholders' Regular Principal Distributable
Amount;
(D) If DFS is the Servicer, to DFS in its capacity as
the Servicer, from the Total Distribution Amount remaining
after the application of clauses (A) through (C), the
Servicing Fee and all unpaid Servicing Fees from prior
Collection Periods;
(E) to the Reserve Account, from the Total
Distribution Amount remaining after the application of clauses
(A) through (D), the amount, if any, by which the Specified
Reserve Account Balance for such Monthly Payment Date exceeds
the amount then on deposit in the Reserve Account; and
(F) to the Note Distribution Account, from the Total
Distribution Amount remaining after the application of clauses
(A) through (E), the Noteholders' Excess Distributable Amount,
if any.
(b) On each Monthly Payment Date, the portion of the Total Distribution
Amount, if any, remaining after making in full each of the allocations and
distributions set forth in Section 5.06(a)(ii), shall be distributed by the
Indenture Trustee from the Collection Account to the
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Owner Trustee for distribution by the Owner Trustee to the Residual
Interestholder pursuant to Section 5.02(a) of the Trust Agreement.
SECTION 5.07. Reserve Account.
(a) On the Closing Date the Depositor shall deposit (or cause to be
deposited) an amount, in immediately available funds, equal to the Reserve
Account Initial Deposit into the Reserve Account. By its execution hereof, the
Indenture Trustee acknowledges receipt of such deposit in the Reserve Account.
(b) In the event that the Noteholders' Interest Distributable Amount
plus the Noteholders' Regular Principal Distributable Amount for a Monthly
Payment Date exceeds the sum of the amounts deposited into the Note Distribution
Account pursuant to Section 5.06(a)(ii) on such Monthly Payment Date, the
Servicer shall instruct the Indenture Trustee to withdraw from the Reserve
Account on such Monthly Payment Date (or, if the Reserve Account is not
maintained at the Indenture Trustee, on the Determination Date preceding such
Monthly Payment Date) an amount equal to such excess, to the extent of funds
available therein, and deposit such amount into the Note Distribution Account
(and the Indenture Trustee shall make such withdrawal and deposit).
(c) If the amount on deposit in the Reserve Account on any Monthly
Payment Date (after giving effect to all deposits thereto or withdrawals
therefrom on such Monthly Payment Date) is greater than the Specified Reserve
Account Balance for such Monthly Payment Date and the Overcollateralization
Amount for such Monthly Payment Date is equal to or exceeds the Targeted
Overcollateralization Amount, then the Servicer shall instruct the Indenture
Trustee to distribute (and the Indenture Trustee shall distribute) the amount of
such excess to the Servicer as additional compensation for servicing the
Receivables. On the first Monthly Payment Date as of which the aggregate
principal amount of the Notes has been reduced to zero, the Servicer shall
instruct the Indenture Trustee to distribute (and the Indenture Trustee shall
distribute) the amount (if any) on deposit in the Reserve Account to the
Servicer as additional compensation for servicing the Receivables. In the event
that DFS is no longer the Servicer, amounts payable to the Servicer pursuant to
this clause (c) shall be paid instead to the Depositor on each applicable
Monthly Payment Date.
SECTION 5.08. Statements to Noteholders. At least three Business Days
prior to each Monthly Payment Date, the Servicer shall provide to the Indenture
Trustee and the Owner Trustee (with a copy to each Paying Agent) information
relating to the Receivables for the applicable Collection Period in order that
the Indenture Trustee may perform the requisite calculations and forward to each
Noteholder of record as of the most recent Record Date a statement substantially
in the form of Exhibit A setting forth the information specified in such Exhibit
and the following information as to the Notes to the extent applicable:
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(i) the amount of distributions to be made on such Monthly
Payment Date allocable to principal of each Class of Notes;
(ii) the amount of such distributions to be made on such
Monthly Payment Date allocable to interest on or with respect to each
Class of Notes;
(iii) the outstanding principal balance of each Class of Notes
and the Note Pool Factor for each such Class, after giving effect to
payments allocated to principal reported under clause (i) above;
(iv) the amount of the Servicing Fee paid to the Servicer with
respect to the related Collection Period or Collection Periods, as the
case may be;
(v) the amount of Realized Losses, if any, with respect to the
related Collection Period;
(vi) the balance of the Reserve Account on such Monthly
Payment Date after giving effect to deposits and withdrawals to be made
on such Monthly Payment Date, if any;
(vii) the Pool Balance as of the close of business on the last
day of the preceding Collection Period; and
(viii) the Noteholders' Interest Carryover Shortfall, if any,
and the change in such amounts from the preceding statement.
Each amount set forth on the Monthly Payment Date statement
under clauses (i), (ii), (iv) and (viii) above shall be expressed as a
dollar amount per $1,000 of original principal balance of a Note.
ARTICLE VI
The Depositor
SECTION 6.01. Representations of Depositor. The Depositor makes the
following representations on which the Issuer is deemed to have relied in
acquiring the Receivables. The representations speak as of the execution and
delivery of this Agreement and as of the Closing Date, in the case of the
Receivables, and shall survive the transfer of the Receivables to the Issuer and
the pledge thereof to the Indenture Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Depositor is duly organized and
validly existing as a corporation in good standing under the laws of the State
of Nevada, with the
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corporate power and authority to own its properties and to conduct its business
as such properties are currently owned and such business is presently conducted,
and had at all relevant times, and has, the corporate power, authority and legal
right to acquire and own the Receivables.
(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 in which the ownership or lease of
property or the conduct of its business shall require such qualifications.
(c) Power and Authority. The Depositor has the corporate power and
authority to execute and deliver this Agreement and to carry out its respective
terms; the Depositor has full power and authority to transfer and assign the
property to be transferred and assigned to and deposited with the Issuer, and
the Depositor shall have duly authorized such transfer and assignment to the
Issuer by all necessary corporate action; and the execution, delivery and
performance of this Agreement by the Depositor has been duly authorized by the
Depositor by all necessary corporate action.
(d) Binding Obligation. This Agreement constitutes a legal, valid and
binding obligation of the Depositor enforceable in accordance with its terms.
(e) No Violation. The consummation of the transactions contemplated by
this Agreement by the Depositor and the fulfillment of the terms hereof by the
Depositor do not conflict with, result in any breach of any of the terms and
provisions of, or constitute (with or without notice or lapse of time) a default
under, the articles of incorporation or bylaws of the Depositor, or any
indenture, agreement 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 or
other instrument (other than pursuant to the Basic Documents); or violate any
law or, to the best of the Depositor's knowledge, any 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 its properties.
(f) No Proceedings. To the Depositor's best knowledge, there are no
proceedings or investigations pending or threatened before any court, regulatory
body, administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties: (i) asserting the invalidity
of this Agreement, the Indenture or any of the other Basic Documents, the Notes
or the Residual Interest, (ii) seeking to prevent the issuance of the Notes or
the Residual Interest or the consummation of any of the transactions
contemplated by this Agreement, the Indenture or any of the other Basic
Documents, (iii) 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, the Indenture, any of the
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other Basic Documents, the Notes or the Residual Interest or (iv) which might
adversely affect the federal or state income tax attributes of the Notes or the
Residual Interest.
(g) Chief Executive Office. The chief executive office of the Depositor
is located at 655 Maryville Centre Drive, St. Louis, Missouri 63141.
SECTION 6.02. Corporate Existence. During the term of this Agreement,
the Depositor shall keep in full force and effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation and shall 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 Agreement, the Basic Documents
and each other instrument or agreement necessary or appropriate to the proper
administration of this Agreement and the transactions contemplated hereby. In
addition, all transactions and dealings between the Depositor and its Affiliates
shall be conducted on an arm's-length basis.
SECTION 6.03. Liability of the Depositor. The Depositor shall be liable
in accordance herewith only to the extent of the obligations specifically
undertaken by the Depositor under this Agreement.
SECTION 6.04. Indemnification. (a) The Depositor shall indemnify,
defend and hold harmless the Issuer, the Owner Trustee, the Indenture Trustee
and any of the officers, directors, employees and agents of the Issuer, the
Owner Trustee and the Indenture Trustee from and against any taxes that may at
any time be asserted against any such Person with respect to the transactions
contemplated herein and in the other Basic Documents (except any income taxes
arising out of fees paid to the Owner Trustee and the Indenture Trustee),
including any sales, gross receipts, general corporation, tangible personal
property, privilege or license taxes (but, in the case of the Issuer, not
including any taxes asserted with respect to, and as of the date of, the
transfer of the Receivables to the Issuer or the issuance and original sale of
the Notes and the Residual Interest, or asserted with respect to ownership of
the Receivables, or federal or other income taxes arising out of distributions
on the Notes and the Residual Interest) and costs and expenses in defending
against the same.
(b) The Depositor shall indemnify, defend and hold harmless the Issuer,
the Owner Trustee, the Indenture Trustee, the Noteholders and Residual
Interestholder and any of the officers, directors, employees and agents of the
Issuer, the Owner Trustee and the Indenture Trustee from and against any loss,
liability or expense incurred by reason of (i) the Depositor's willful
misfeasance, bad faith or negligence in the performance of its duties under this
Agreement, or by reason of reckless disregard of its obligations and duties
under this Agreement and (ii) the Depositor's or the Issuer's violation of
federal or state securities laws in connection with the offering and sale of the
Notes or the Residual Interest.
(c) The Depositor shall indemnify, defend and hold harmless the Owner
Trustee and the Indenture Trustee and their respective officers, directors,
employees and agents from and
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against all costs, expenses, losses, claims, damages and liabilities arising out
of or incurred in connection with the acceptance or performance of the trusts
and duties herein and in the Trust Agreement contained, in the case of the Owner
Trustee, and herein and in the Indenture contained, in the case of the Indenture
Trustee, except to the extent that such cost, expense, loss, claim, damage or
liability: (i) in the case of the Owner Trustee, shall be due to the willful
misfeasance, bad faith or negligence (except for errors in judgment) of the
Owner Trustee or, in the case of the Indenture Trustee, shall be due to the
willful misfeasance, bad faith or negligence (except for errors in judgment) of
the Indenture Trustee; or (ii) in the case of the Owner Trustee, shall arise
from the breach by the Owner Trustee of any of its representations or warranties
set forth in Section 7.03 of the Trust Agreement.
(d) The Depositor shall pay any and all taxes levied or assessed upon
all or any part of the Owner Trust Estate (other than any taxes expressly
excluded from the Depositor's responsibilities pursuant to this Section 6.04).
Indemnification under this Section shall survive the resignation or
removal of the Owner Trustee or the Indenture Trustee and the termination of
this Agreement and the other Basic Documents and shall include reasonable fees
and expenses of counsel and expenses of litigation. If the Depositor shall have
made any indemnity payments pursuant to this Section and the Person to or on
behalf of whom such payments are made thereafter shall collect any of such
amounts from others, such Person shall promptly repay such amounts to the
Depositor, without interest.
SECTION 6.05. Merger or Consolidation of, or Assumption of the
Obligations of, Depositor. Any Person (a) into which the Depositor may be merged
or consolidated, (b) which may result from any merger or consolidation to which
the Depositor shall be a party or (c) which may succeed to the properties and
assets of the Depositor substantially as a whole, which Person in any of the
foregoing cases executes an agreement of assumption to perform every obligation
of the Depositor under this Agreement, shall be the successor to the Depositor
hereunder without the execution or filing of any document or any further act by
any of the parties to this Agreement; provided, however, that (i) immediately
after giving effect to such transaction, no representation or warranty made by
the Depositor pursuant to Section 3.01 shall have been breached (unless the
applicable breach shall have been cured, or the applicable Receivable shall have
been purchased in accordance therewith), (ii) the Depositor 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 and that all
conditions precedent, if any, provided for in this Agreement relating to such
transaction have been complied with, (iii) the Rating Agency Condition shall
have been satisfied with respect to such transaction and (iv) the Depositor
shall have delivered to the Owner Trustee and the Indenture Trustee an Opinion
of Counsel either (A) stating that, in the opinion of such counsel, all
financing statements and continuation statements and amendments thereto have
been executed and filed that are necessary fully to preserve and protect the
interest of the Owner Trustee and Indenture Trustee, respectively, in the
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Receivables and reciting the details of such filings, or (B) stating that, in
the opinion of such counsel, no such action shall be necessary to preserve and
protect such interests. Notwithstanding anything herein to the contrary, the
execution of the foregoing agreement of assumption and compliance with clauses
(i), (ii), (iii) and (iv) above shall be conditions to the consummation of the
transactions referred to in clauses (a), (b) or (c) above.
SECTION 6.06. Limitation on Liability of Depositor and Others. The
Depositor and any director, officer, 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 hereunder. The Depositor shall not be under any obligation to appear in,
prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement, and that in its opinion may involve it in any
expense or liability.
SECTION 6.07. Depositor May Own Notes. The Depositor and any Affiliate
thereof may in its individual or any other capacity become the owner or pledgee
of Notes with the same rights as it would have if it were not the Depositor or
an Affiliate thereof, except as expressly provided herein or in any other Basic
Document.
SECTION 6.08. Pennsylvania Motor Vehicle Sales Finance Act License. The
Depositor shall use its best efforts to maintain, and shall cause the Trust to
use its best efforts to maintain, the effectiveness of all licenses required
under the Pennsylvania Motor Vehicle Sales Finance Act in connection with this
Agreement and the other Basic Documents and the transactions contemplated hereby
and thereby until such time as the Trust shall terminate in accordance with the
Trust Agreement.
ARTICLE VII
The Servicer
SECTION 7.01. Representations and Warranties of the Servicer. DFS makes
the following representations and warranties on which each of the Transferor,
the Depositor and the Issuer is deemed to have relied in acquiring the
Receivables. Such representations and warranties speak as of the execution and
delivery of this Agreement and as of the Closing Date but shall survive (1) the
transfer and assignment of the Receivables to the Issuer and the pledge thereof
to the Indenture Trustee pursuant to the Indenture and (2) the removal of DFS as
Servicer.
(i) DFS is a corporation duly organized, validly existing and
in good standing under the laws of the State of Nevada with the full
power and authority to own and conduct its business as it is presently
conducted by DFS. DFS is or shall be in compliance with the laws of any
state to the extent necessary to insure the enforceability
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of each Receivable and the servicing of the Receivables in accordance
with the terms of this Agreement.
(ii) DFS has the full power and authority to consummate all
transactions contemplated by this Agreement. DFS has duly authorized
the execution, delivery and performance of this Agreement, has duly
executed and delivered this Agreement and this Agreement constitutes a
legal, valid and binding obligation of DFS, enforceable against it in
accordance with its terms.
(iii) Neither the execution and delivery of this Agreement by
DFS, the acquisition or origination of the Receivables by DFS, the
consummation by DFS of the transactions contemplated hereby, nor the
fulfillment of or compliance by DFS with the terms and conditions of
this Agreement shall conflict with or result in a breach of any of the
terms of the charter or by-laws of DFS or any legal restriction or any
agreement or instrument to which DFS is now a party or by which it is
bound, or constitute a default or result in an acceleration under any
of the foregoing, or result in the violation of any law, rule,
regulation, order, judgment or decree to which DFS or its property is
subject.
(iv) DFS does not believe, nor does it have any reason or
cause to believe, that it cannot perform each and every covenant of DFS
contained in this Agreement.
(v) There is no litigation pending or, to the knowledge of
DFS, threatened, which if determined adversely to DFS would adversely
affect the execution, delivery or enforceability of this Agreement, or
the ability of DFS to service the Receivables hereunder in accordance
with the terms hereof or which would have a material adverse effect on
the financial condition of DFS.
(vi) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery
and performance by DFS of or compliance by DFS with this Agreement or
the consummation by DFS of the transactions contemplated by this
Agreement.
(vii) The collection practices used by DFS with respect to
each Receivable have been in all respects legal, proper, prudent and
customary in the origination and servicing of receivables similar to
the Receivables.
(viii) The chief executive office of DFS is located in St.
Louis, Missouri.
(ix) Neither the representations and warranties of DFS set
forth in this Agreement nor any statement, report or other document
furnished or to be furnished by DFS in connection with or pursuant to
this Agreement or in connection with the transactions contemplated
hereby contains any untrue statement of fact or omits to state a fact
necessary to make the statements contained therein not misleading;
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SECTION 7.02. Indemnities, etc. of Servicer. The Servicer shall be
liable in accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer under this Agreement:
(a) The Servicer shall indemnify, defend and hold harmless the Issuer,
the Owner Trustee, the Indenture Trustee, the Noteholders, the Residual
Interestholder and the Depositor and any of the officers, directors, employees
and agents of the Issuer, the Owner Trustee and the Indenture Trustee from and
against any and all costs, expenses, losses, damages, claims and liabilities
arising out of or resulting from the use, ownership or operation by the Servicer
or any Affiliate thereof of a Financed Vehicle.
(b) The Servicer shall indemnify, defend and hold harmless the Issuer,
the Owner Trustee, the Indenture Trustee, the Depositor, the Noteholders, the
Residual Interestholder and any of the officers, directors, employees and agents
of the Issuer, the Owner Trustee and the Indenture Trustee 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 any such Person through, the 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 agrees to pay when due the compensation and any other
amounts due to the Indenture Trustee and the Owner Trustee pursuant to Section
6.07 of the Indenture and Section 8.02 of the Trust Agreement (in the event the
Issuer or the Depositor, as applicable, cannot fully indemnify the Indenture
Trustee or the Owner Trustee), as applicable.
For purposes of this Section, in the event of the termination of the
rights and obligations of DFS (or any successor thereto pursuant to Section
7.03) as Servicer pursuant to Section 8.01, or a resignation by such Servicer
pursuant to this Agreement, such Servicer shall be deemed to be the Servicer
pending appointment of a successor Servicer (other than the Indenture Trustee)
pursuant to Section 8.02.
Indemnification and other payments under this Section shall survive the
resignation or removal of the Owner Trustee or the Indenture Trustee or the
termination of this Agreement and the Indenture and shall include reasonable
fees and expenses of counsel and expenses of litigation. If the Servicer shall
have made any indemnity payments pursuant to this Section and the Person to or
on behalf of whom such payments are made thereafter collects any of such amounts
from others, such Person shall promptly repay such amounts to the Servicer,
without interest.
SECTION 7.03. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer. Any Person (a) into which the Servicer may be merged
or consolidated, (b) resulting from any merger or consolidation to which the
Servicer is a party, or (c) succeeding to the
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properties and assets of the Servicer substantially as a whole, which Person (in
each of the cases contemplated by clauses (a)-(c)) executed an agreement of
assumption to perform every obligation of the Servicer hereunder, shall be the
successor to the Servicer under this Agreement without further act on the part
of any of the parties to this Agreement; provided, however, that (i) immediately
after giving effect to such transaction, no Servicer Default and no event which,
after notice or lapse of time, or both, would become a Servicer Default shall
have occurred and be continuing, (ii) the Servicer 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 and that all conditions
precedent provided for in this Agreement relating to such transaction have been
complied with, (iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction and (iv) 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 (A) all financing statements and
continuation statements and amendments thereto have been executed and filed that
are necessary fully to preserve and protect the interest of the Owner Trustee
and the Indenture Trustee, respectively, in the Receivables and reciting the
details of such filings or (B) no such action shall be necessary to preserve and
protect such interests. Notwithstanding anything herein to the contrary, the
execution of the foregoing agreement of assumption and compliance with clauses
(i), (ii), (iii) and (iv) above shall be conditions to the consummation of the
transactions referred to in clause (a), (b) or (c) above.
SECTION 7.04. Limitation on Liability of Servicer and Others. Neither
the Servicer nor any of the directors, officers, employees or agents of the
Servicer shall be under any liability to the Issuer, the Noteholders or the
Residual Interestholder, except as provided under this Agreement, for any action
taken or for refraining from the taking of any action pursuant to this Agreement
or for errors in judgment; provided, however, that this provision shall not
protect the Servicer or any such Person against any liability that would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
in the performance of the Servicer's duties under this Agreement or by reason of
reckless disregard of obligations and duties under this Agreement. The Servicer
and any director, officer, employee or agent of the Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted by
any Person respecting any matters arising under this Agreement.
Except as provided in this Agreement, the Servicer shall not be under
any obligation to appear in, prosecute or defend any legal action that shall not
be incidental to its duties to service the Receivables in accordance with this
Agreement and that in its opinion may involve it in any expense or liability;
provided, however, that the Servicer may undertake any reasonable action that it
may deem necessary or desirable in respect of this Agreement and the other Basic
Documents and the rights and duties of the parties to this Agreement and the
other Basic Documents and the interests of the Noteholders under the Indenture
and of the Residual Interestholder under the Trust Agreement.
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SECTION 7.05. Resignation of Servicer. Subject to the provisions of
Section 7.03, the Person which is the Servicer shall not resign from the
obligations and duties hereby imposed on it as Servicer under this Agreement
except upon a determination that the performance of its duties under this
Agreement shall no longer be permissible under applicable law. Notice of any
such determination permitting the resignation of the Servicer shall be
communicated to the Owner Trustee and the Indenture Trustee at the earliest
practicable time (and, if such communication is not in writing, shall be
confirmed in writing at the earliest practicable time) and any such
determination shall be evidenced by an Opinion of Counsel to such effect
delivered to the Owner Trustee and the Indenture Trustee concurrently with or
promptly after such notice. No such resignation shall become effective until the
Indenture Trustee or a successor Servicer shall have assumed the
responsibilities and obligations of the resigning Servicer in accordance with
Section 8.02. In addition, in effecting such resignation, the resigning Servicer
shall cooperate with the successor Servicer, the Indenture Trustee and the Owner
Trustee in effecting the termination of its responsibilities and rights as
Servicer under this Agreement, including the transfer to the successor Servicer
for administration by it of all cash amounts that shall at the time be held by
it for deposit, or shall thereafter be received by it with respect to any
Receivable. The resigning Servicer shall also give the successor Servicer access
to its records, software, systems, facilities and employees in order to
facilitate the servicing transfer. All reasonable costs and expenses (including
attorneys' fees) incurred in connection with transferring the Receivable Files
and the Servicer's duties to the successor Servicer and amending this Agreement
to reflect such succession as Servicer shall be paid by DFS upon presentation of
reasonable documentation of such costs and expenses. Upon receipt of notice of
the occurrence of any such resignation, the Owner Trustee shall give notice
thereof to the Rating Agencies.
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ARTICLE VIII
Servicer Default
SECTION 8.01. Servicer Default. If any one of the following events (a
"Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to deliver to the Indenture Trustee for
deposit in any of the Trust Accounts or the Residual Interestholder Distribution
Account any required payment or to direct the Indenture Trustee to make any
required distributions therefrom, which failure continues unremedied for a
period of three Business Days after written notice of such failure is received
by the Servicer from the Owner Trustee or the Indenture Trustee or after
discovery of such failure by the Servicer; or
(b) any failure by the Servicer duly to observe or to perform in any
material respect any other covenant or agreement of the Servicer set forth in
this Agreement or any other Basic Document, which failure shall (i) materially
and adversely affect the rights of the Noteholders or the Residual
Interestholder and (ii) continue unremedied for a period of 60 days after the
date on which written notice of such failure shall have been given (A) to the
Servicer by the Owner Trustee or the Indenture Trustee or (B) to the Servicer,
and to the Owner Trustee and the Indenture Trustee, by the Holders of Notes
evidencing not less than 25% of the Outstanding Amount of the Notes or by the
Residual Interestholder; or
(c) the occurrence of an Insolvency Event with respect to the Servicer;
then, and in each and every case, so long as the Servicer Default shall
not have been remedied, either the Indenture Trustee or the Holders of Notes
evidencing not less than 25% of the Outstanding Amount of the Notes, by notice
then given in writing to the Servicer (and to the Indenture Trustee and the
Owner Trustee if given by the Noteholders) may terminate all the rights and
obligations (other than the obligations set forth in Section 7.02 hereof) of the
Servicer under this Agreement. On or after the latest of receipt by the Servicer
of such written notice or the date of termination specified in such notice or
deemed specified pursuant to Section 8.02(d), all authority and power of the
Servicer under this Agreement, whether with respect to the Notes or the
Receivables or otherwise, shall, without further action, pass to and be vested
in the Indenture Trustee or such successor Servicer as may be appointed under
Section 8.02; and, without limitation, the Indenture Trustee and the Owner
Trustee are hereby authorized and empowered to execute and deliver, for the
benefit of the predecessor 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, whether to complete the transfer and endorsement of the Receivables
and related documents, or otherwise. The predecessor Servicer shall cooperate
with the successor Servicer, the Indenture Trustee and the Owner Trustee in
effecting the termination of the responsibilities and rights of
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the predecessor Servicer under this Agreement, including the transfer to the
successor Servicer for administration by it of all cash amounts that shall at
the time be held by the predecessor Servicer for deposit, or shall thereafter be
received by it with respect to any Receivable. The predecessor Servicer shall
also give the successor Servicer access to its records, software, systems,
facilities and employees in order to facilitate the servicing transfer. All
reasonable costs and expenses (including attorneys' fees) incurred in connection
with transferring the Receivable Files and the Servicer's duties to the
successor Servicer and amending this Agreement to reflect such succession as
Servicer pursuant to this Section shall be paid by the predecessor Servicer upon
presentation of reasonable documentation of such costs and expenses. Upon
receipt of notice of the occurrence of a Servicer Default, the Owner Trustee
shall give notice thereof to the Rating Agencies.
The Owner Trustee agrees that if it gives a notice under clause (a) or
clause (b) above, the Owner Trustee shall simultaneously send a copy of such
notice to the Indenture Trustee. The Indenture Trustee agrees that if it gives a
notice under clause (a) or clause (b) above, the Indenture Trustee shall
simultaneously send a copy of such notice to the Owner Trustee.
SECTION 8.02. Appointment of Successor.
(a) Upon the Servicer's receipt of notice of termination pursuant to
Section 8.01 or the Servicer's resignation in accordance with the terms of this
Agreement, the predecessor Servicer shall continue to perform its functions as
Servicer under this Agreement, in the case of termination, only until the date
specified in such termination notice or, if no such date is specified in a
notice of termination, until receipt of such notice (subject in each case to
Section 8.02(d)) and, in the case of resignation, until the later of (i) the
date 45 days from the delivery to the Owner Trustee and the Indenture Trustee of
written notice of such resignation (or written confirmation of such notice) in
accordance with the terms of this Agreement and (ii) the date upon which the
predecessor Servicer shall become unable to act as Servicer, as specified in the
notice of resignation and accompanying Opinion of Counsel. In the event of the
Servicer's termination hereunder, the Indenture Trustee shall appoint a
successor Servicer, and the successor Servicer shall accept its appointment by a
written assumption in form acceptable to the Owner Trustee and the Indenture
Trustee. In the event that a successor Servicer has not been appointed at the
time when the predecessor Servicer has ceased to act as Servicer in accordance
with this Section, the Indenture Trustee without further action shall
automatically be appointed the successor Servicer and the Indenture Trustee
shall be entitled to the Servicing Fee. Notwithstanding the above, the Indenture
Trustee shall, if it shall be legally unable so to act, appoint or petition a
court of competent jurisdiction to appoint any established institution, having a
net worth of not less than $100,000,000 and whose regular business shall include
the servicing of recreational vehicle receivables, as the successor to the
Servicer under this Agreement.
(b) Upon appointment, the successor Servicer (including the Indenture
Trustee acting as successor Servicer) shall be the successor in all respects to
the predecessor Servicer and shall
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be subject to all the responsibilities, duties and liabilities arising
thereafter relating thereto placed on the predecessor Servicer and shall be
entitled to the Servicing Fee and all the rights granted to the predecessor
Servicer by the terms and provisions of this Agreement.
(c) The Servicer may not resign except as contemplated by Section 7.05.
(d) Notwithstanding anything herein to the contrary, any notice of
termination delivered by Noteholders pursuant to Section 8.01 that (i) does not
contain therein a date as of which such termination shall take effect or (ii)
contains such a date of termination, shall be deemed, in the case of clauses (i)
and (ii) to contain a date of termination which is no sooner than the date,
established by the Indenture Trustee by notice to the Servicer, which shall be
the earliest date practicable by which the Indenture Trustee is capable of
assuming the functions of Servicer hereunder.
SECTION 8.03. Repayment of Advances. If the Servicer shall change, the
predecessor Servicer shall be entitled to receive reimbursement for Outstanding
Advances pursuant to Section 5.04 with respect to all Advances made by the
predecessor Servicer.
SECTION 8.04. Notification to Noteholders. Upon any termination of, or
appointment of a successor to, the Servicer pursuant to this Article VIII, the
Indenture Trustee shall give prompt written notice thereof to Noteholders and
the Rating Agencies.
SECTION 8.05. Waiver of Past Defaults. The Majority Noteholders may, on
behalf of all Noteholders, waive in writing any default by the Servicer in the
performance of its obligations hereunder and its consequences, except a default
in making any required deposits to or payments from any of the Trust Accounts in
accordance with this Agreement. Upon any such waiver of a past default, such
default shall cease to exist, and any Servicer Default 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 thereto.
ARTICLE IX
Termination
SECTION 9.01. Optional Purchase of All Receivables.
(a) If the Pool Balance is less than ten percent (10%) of the Initial
Pool Balance as of the last day of any Collection Period, then the Servicer
shall have the option to purchase all (but not less than all) of the Owner Trust
Estate, other than the Trust Accounts, on any Monthly Payment Date following
such day. To exercise such option, the Servicer shall deposit pursuant to
Section 5.05 in the Collection Account an amount equal to the aggregate of the
Purchase Amounts for the Receivables (provided that if the Obligor of a
Receivable is financially unable
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to make some or all of the payments on such Receivable, the Purchase Amount in
respect of such Receivable shall be the fair market value of such Receivable),
plus the appraised value of any other property held by the Trust other than the
Trust Accounts (the value of any other property held by the Trust, other than
the Trust Accounts to be determined as of the last day of the Collection Period
preceding such Monthly Payment Date by an appraiser mutually agreed upon by the
Servicer, the Owner Trustee and the Indenture Trustee), and shall succeed to all
interests in and to the Trust. Notwithstanding the foregoing, the Servicer shall
not be permitted to exercise such option unless the resulting distribution to
the Noteholders on such Monthly Payment Date would be sufficient to pay the sum
of the outstanding principal balance of the Notes plus all accrued and unpaid
interest thereon. This Section 9.01 is subject to the terms and conditions of
Section 10.01 of the Indenture.
(b) Following the satisfaction and discharge of the Indenture and the
payment in full of the principal of and interest on the Notes, the Residual
Interestholder shall succeed to the rights of the Noteholders hereunder and the
Owner Trustee shall succeed to the rights of, and assume the obligations of, the
Indenture Trustee pursuant to this Agreement.
ARTICLE X
Miscellaneous
SECTION 10.01. Amendment. This Agreement may be amended by the Issuer,
the Depositor and the Servicer, with the consent of the Indenture Trustee, but
without the consent of any other Person, to cure any ambiguity, to correct or
supplement any provisions in this Agreement or for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions in
this Agreement or of modifying in any manner the rights of the Noteholders or
Residual Interestholder; 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 any
Noteholder or the Residual Interestholder.
This Agreement may also be amended from time to time by the Issuer, the
Depositor and the Servicer, with the consent of the Indenture Trustee and the
consent of the Majority Noteholders and the consent of the Residual
Interestholder, 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 Noteholders or the Residual Interestholder;
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 Receivables or distributions that shall be required to be made for
the benefit of the Noteholders or (b) reduce the aforesaid percentage of the
Outstanding Amount of the Notes, the Holders of which are required to consent to
any such amendment, without the consent of the Holders of all of the outstanding
Notes.
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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 the Indenture Trustee and each of the Rating Agencies.
It shall not be necessary for the consent of Noteholders or the
Residual Interestholder 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.
Prior to the execution of or the consent to any amendment to this
Agreement, the Owner Trustee and the Indenture Trustee shall be entitled to
receive and rely upon (i) an Opinion of Counsel stating that the execution of
such amendment is authorized or permitted by this Agreement and (ii) the Opinion
of Counsel referred to in Section 10.02(i). The Owner Trustee and the Indenture
Trustee may, but shall not be obligated to, enter into or consent to any such
amendment which affects the Owner Trustee's or the Indenture Trustee's, as
applicable, own rights, duties or immunities under this Agreement or otherwise.
SECTION 10.02. Protection of Title to Trust; Change of Name, Identity,
Corporate Structure or Location of the Depositor, Etc.
(a) The Depositor shall execute and file such financing statements and
cause to be executed and filed such continuation statements, 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 and of the Indenture Trustee in the
Receivables and in the proceeds thereof. 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) The Depositor shall not change its name, identity or corporate
structure in any manner that would, could or might make any financing statement
or continuation statement filed 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 five days' prior
written notice thereof and shall have promptly filed appropriate amendments to
all previously filed financing statements or continuation statements.
(c) The Depositor shall give the Owner Trustee and the Indenture
Trustee at least 60 days' prior written notice of any relocation of its chief
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 and shall
promptly file any such amendment or new financing statement. The Servicer shall
at all times maintain each office from which it shall service Receivables, and
its principal executive office, within the United States of America.
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(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit (i) the reader thereof
to know at any time the status of such Receivable, 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
Receivable and the amounts from time to time deposited in the Collection Account
in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that, from and
after the time of transfer under this Agreement of the Receivables, the
Servicer's master computer records (including any backup archives) that refer to
a Receivable shall indicate clearly the interest of the Issuer and the Indenture
Trustee in such Receivable and that such Receivable is owned by the Issuer and
has been pledged to the Indenture Trustee. Indication of the Issuer's and the
Indenture Trustee's interest in a Receivable shall be deleted from or modified
on the Servicer's computer systems when, and only when, the related Receivable
shall have been paid in full or shall have become a Purchased Receivable.
(f) If at any time the Depositor or the Servicer shall propose to sell,
grant a security interest in, or otherwise transfer any interest in recreational
vehicle receivables to any prospective purchaser, lender or other transferee,
the Servicer shall give to such prospective purchaser, lender or other
transferee computer tapes, records or printouts (including any restored from
backup archives) that, if they shall refer in any manner whatsoever to any
Receivable, shall indicate clearly that such Receivable has been transferred to
and is owned by the Issuer and has been pledged to the Indenture Trustee.
(g) The Servicer shall permit the Indenture Trustee and its agents at
any time during normal business hours to inspect, audit and make copies of and
abstracts from the Servicer's records regarding any Receivable.
(h) Upon request, the Servicer shall furnish to the Owner Trustee or to
the Indenture Trustee, within five Business Days, a list of all Receivables (by
contract number and name of Obligor) then held as part of the Trust, together
with a reconciliation of such list to the Schedule of Receivables and to each of
the Servicer's Certificates furnished before such request indicating removal of
Receivables from the Trust.
(i) The Servicer shall deliver to the Owner Trustee and the Indenture
Trustee, promptly after the execution and delivery of this Agreement, and of
each amendment hereto and on each Monthly Payment Date occurring in September,
an Opinion of Counsel (which may be an employee of the Servicer) stating that,
in the opinion of such counsel, either (A) all financing statements and
continuation statements have been executed and filed that are necessary fully to
preserve and protect the interest of the Owner Trustee and the Indenture Trustee
in the Receivables, and reciting the details of such filings or referring to
prior Opinions of Counsel in which such details are given, or (B) no such action
shall be necessary to preserve and protect
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such interest. Each such Opinion of Counsel shall specify any action necessary
(as of the date of such opinion) to be taken in the following year to preserve
and protect such interest.
(j) The Depositor shall, to the extent required by applicable law,
cause the Notes and Certificates to be registered with the Commission pursuant
to Section 12(b) or Section 12(g) of the Exchange Act within the time periods
specified in such sections.
SECTION 10.03. Notices. All demands, notices, directions,
communications and instructions upon, to, or by the Depositor, the Servicer, the
Owner Trustee, the Indenture Trustee or the Rating Agencies under this Agreement
shall be in writing, personally delivered or mailed by certified mail, return
receipt requested, and shall be deemed to have been duly given upon receipt (a)
in the case the Servicer (so long as DFS is the Servicer), to Deutsche Financial
Services Corporation, 655 Maryville Centre Drive, St. Louis, Missouri 63141,
Attention: Senior Vice President/Treasurer or Chief Legal Officer, (b) in the
case of the Depositor, to Deutsche Recreational Asset Funding Corporation, 655
Maryville Centre Drive, St. Louis, Missouri 63141, Attention: President, (c) in
the case of the Issuer or the Owner Trustee, at the Corporate Trust Office with
respect to the Owner Trustee, (d) in the case of the Indenture Trustee, at the
Corporate Trust Office with respect to the Indenture Trustee, (e) in the case of
Fitch, to Fitch IBCA Inc., One State Street Plaza, New York, New York 10004,
Attention: Asset-Backed Securities Surveillance Group, and (f) in the case of
Standard & Poor's, to Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc., 25 Broadway (15th Floor), New York, New York 10004,
Attention: Asset Backed Surveillance Department; or, as to each of the
foregoing, at such other address as shall be designated by written notice to the
other Persons listed in this Section.
SECTION 10.04. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in this Section, in Sections 6.05 and 7.03
of this Agreement and as provided in the provisions of this Agreement concerning
the resignation of the Servicer, this Agreement may not be assigned by the
Depositor or the Servicer. The parties hereto hereby acknowledge and consent to
the mortgage, pledge, assignment and grant of a security interest by the Issuer
to the Indenture Trustee pursuant to the Indenture for the benefit of the
Noteholders of all right, title and interest of the Issuer in, to and under the
Depositor Conveyed Property and/or the assignment of any or all of the Issuer's
rights under this Agreement to the Indenture Trustee.
SECTION 10.05. Limitations on Rights of Others. The provisions of
this Agreement are solely for the benefit of the Depositor, the Servicer, the
Issuer, the Owner Trustee, the Indenture Trustee, the Noteholders and the
Residual Interestholder, and, except as expressly provided in this Agreement,
nothing in this Agreement shall be construed to give to any other Person any
legal or equitable right, remedy or claim in the Owner Trust Estate or under or
in respect of this Agreement or any covenants, conditions or provisions
contained herein.
SECTION 10.06. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of
36
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such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 10.07. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 10.08. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 10.09. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE PERFECTION (AND THE EFFECT OF
PERFECTION OR NON-PERFECTION) OF THE INTERESTS OF ANY PERSON IN CONVEYED
PROPERTY ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW
YORK.
SECTION 10.10. Nonpetition Covenants. Notwithstanding any prior
termination of this Agreement, the Servicer and the Depositor shall not
acquiesce, petition or otherwise invoke or cause the Issuer to invoke the
process of any court or government authority for the purpose of commencing or
sustaining a case against the Issuer 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 any
substantial part of its property, or ordering the winding up or liquidation of
the affairs of the Issuer. Notwithstanding any prior termination of this
Agreement, the Servicer and the Issuer shall not acquiesce, petition or
otherwise invoke or cause the Depositor to invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
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 Depositor or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
Depositor.
SECTION 10.11. Limitation of Liability of Owner Trustee and Indenture
Trustee.
(a) Notwithstanding anything contained herein to the contrary, this
Agreement has been countersigned by Norwest Bank Minnesota, National
Association, not in its individual capacity but solely in its capacity as Owner
Trustee of the Issuer and in no event shall Norwest Bank Minnesota, National
Association, in its individual capacity or, except as expressly provided in the
Trust Agreement, as beneficial owner of the Issuer have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or
37
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in any of the certificates, notices or agreements delivered pursuant hereto, as
to all of which recourse shall be had solely to the assets of the Issuer. For
all purposes of this Agreement, in the performance of its duties or obligations
hereunder or 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.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been accepted by The Chase Manhattan Bank, not in its individual
capacity but solely as Indenture Trustee and in no event shall The Chase
Manhattan Bank have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets of the Issuer.
SECTION 10.12. Waiver. Each of DFS, the Depositor, the Trust, the Owner
Trustee and the Indenture Trustee hereby (a) acknowledges that Mayer, Brown &
Platt represents (i) DFS, the Transferor, and the Depositor in connection with
the transactions contemplated by the Basic Documents, (ii) Affiliates of the
Transferor, DFS and the Depositor in other matters, (iii) underwriters of the
Notes (and Affiliates of such underwriters) in other matters, (iv) the
institutions which are the Indenture Trustee and the Owner Trustee (and
Affiliates of such institutions) in other matters, and (v) the Specified
Accountants in other matters, and (b) waives any conflict of interest relating
thereto. Notwithstanding any other provision of this Agreement, Mayer, Brown &
Platt is entitled to rely on this Section.
SECTION 10.13. Separate Corporate Existence. The Depositor hereby
acknowledges that the Trust is entering into the transactions contemplated by
the Basic Documents in reliance upon the Depositor's identity as a legal entity
separate from DFS and the Transferor. Therefore, the Depositor shall take all
reasonable steps to make it apparent to third Persons that each of DFS and the
Transferor is an entity with assets and liabilities distinct from those of the
Depositor and any other Affiliate and that the Depositor is not a division of
DFS or the Transferor or any other Person. Without limiting the foregoing, the
Depositor shall (and shall cause each of DFS and the Transferor to) operate and
conduct its business and otherwise act in a manner which is consistent with the
following:
(a) The Depositor shall maintain its own stationery and other business
forms separate from those of any other Person (including DFS and the Transferor)
and shall conduct business in its own name.
(b) The Depositor shall not need to maintain any office space of its
own (apart from the office space used by Servicer) as part of its operations. If
the Depositor utilizes any office space, such office space shall be clearly
demarcated as being allocated to Depositor.
(c) DFS or the Transferor may issue consolidated financial statements
that shall include the Depositor, but such financial statements shall contain a
footnote to the effect that
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DFS contributed certain Receivables to the Transferor, the Transferor then
contributed the Receivables to the Depositor and the Depositor in turn
contributed the Receivables to the Trust. Separate financial statements shall
also be prepared for the Depositor. In addition to the aforementioned footnote
to any consolidated financial statement, DFS, the Transferor and the Depositor
shall take certain actions to disclose publicly the Depositor's separate
existence and the transactions contemplated hereby, including, without
limitation, through the filing of UCC financing statements. Neither DFS, the
Transferor nor the Depositor has concealed or shall conceal from any interested
party any transfers contemplated by the Basic Documents, although Obligors shall
not be affirmatively informed in the first instance of the transfer of their
obligations.
(d) The Transferor has caused and shall continue to cause an
Independent Director to be elected to the board of directors of the Depositor,
and the Depositor compensates the Independent Director.
(e) The Depositor shall not have its own employees, and the Depositor's
business relating to the Receivables shall be primarily conducted through DFS as
Servicer. However, any allocations of direct, indirect or overhead expenses for
items shared among the Depositor, the Transferor and DFS that are not included
as part of the Servicing Fee are and shall be made among such entities to the
extent practical on the basis of actual use or value of services rendered and
otherwise on a basis reasonably related to actual use or the value of services
rendered.
(f) DFS, the Depositor and the Transferor shall maintain their assets
and liabilities in such a manner that it is not costly or difficult to
segregate, ascertain or otherwise identify the individual assets and liabilities
of the Depositor from those of the others or from those of any other Person,
including any other subsidiary or other Affiliate of DFS. Except as set forth
below, the Depositor shall maintain its own books of account and corporate
records separate from DFS, the Transferor, and any other subsidiary or other
Affiliate of DFS. The Depositor shall not commingle or pool its funds (or other
assets) or liabilities with those of DFS, the Transferor, or any other
subsidiary or Affiliate of DFS except as specifically provided in this Agreement
with respect to the temporary commingling of collections of the Receivables and
except with respect to the retention by DFS, in its capacity as Servicer, of the
books and records pertaining to the Receivables. However, DFS shall not
generally make the books and records relating to the Receivables available to
any of the creditors of DFS or other interested persons, and in the rare
instance when it does so, DFS simultaneously also shall provide the marked
computer records and shall make such books and records available for the sole
purpose of permitting creditors and other interested parties of DFS to verify
the existence of DFS and performance of its duties as Servicer. The Depositor
shall not maintain joint bank accounts or other depository accounts to which
DFS, the Transferor, or any other subsidiary or Affiliate of DFS (other than DFS
solely in its capacity as Servicer) has independent access.
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(g) Each of DFS and the Transferor, on the one hand, and the Depositor,
on the other hand, shall strictly observe corporate formalities, including with
respect to its dealings with the other. Specifically, no transfer of assets
between DFS and the Transferor on the one hand, and the Depositor, on the other
hand, shall be made without adherence to corporate formalities.
(h) Neither the Depositor, on the one hand, or DFS, the Transferor, or
any other subsidiary or other Affiliate of DFS, on the other hand, shall be, or
shall hold itself out to be, responsible for the debts of the other, or, except
as provided in this Agreement with respect to the duties of the Servicer, the
decisions or actions respecting the daily business and affairs of the other,
except as contemplated by the expense reimbursement and indemnification
provisions of the Basic Documents and any underwriting agreement executed in
connection therewith.
(i) All distributions made by the Depositor to the Transferor as its
sole shareholder shall be made in accordance with applicable law.
(j) Any other transactions between DFS and the Depositor or DFS and the
Transferor permitted by (although not expressly provided for in the Basic
Documents) shall be fair and equitable to DFS, the Depositor and the Transferor,
shall be the type of transaction that would be entered into by a prudent Person
in the position of DFS, the Depositor or the Transferor vis a vis each other,
and shall be on terms that are at least favorable as may be obtained from a
Person who is not DFS, the Depositor or the Transferor.
(k) The Depositor is not named, and has not entered into any agreement
to be named, directly or indirectly, as a direct or contingent beneficiary or
loss payee on any insurance policy covering the property of DFS, the Transferor
or any other subsidiary or other Affiliate of DFS except for an insurance policy
with respect to the liability of directors and officers maintained by Deutsche
Bank AG for the benefit of its direct and indirect subsidiaries.
SECTION 10.14. Submission to Jurisdiction. Each of the parties hereto
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any other Basic Document or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
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(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Person at its
address set forth in Section 10.03 or at such other address notified to the
other parties to this Agreement pursuant thereto; and
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to sue
in any other jurisdiction.
SECTION 10.15. Tax Treatment. The parties hereto agree to treat (and
DFS shall cause the Transferor to treat) the Trust and the Notes for tax
purposes in a manner which is consistent with the applicable tax treatment
specified in the other Basic Documents.
[SIGNATURES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Transfer and
Servicing Agreement to be duly executed as of the day and year first above
written.
DISTRIBUTION FINANCIAL SERVICES RV TRUST 1999-1
By: Norwest Bank Minnesota, National Association, not in its
individual capacity but solely as Owner Trustee on behalf
of the Trust
By: /s/ Marianna C. Stershic
------------------------------------
Name: Marianna C. Stershic
----------------------------------
Title: Assistant Vice President
---------------------------------
DEUTSCHE RECREATIONAL ASSET FUNDING
CORPORATION, as Depositor
By: /s/ Richard C. Goldman
------------------------------------
Name: Richard C. Goldman
----------------------------------
Title: Vice President
---------------------------------
By: /s/ Richard H. Schumacher
------------------------------------
Name: Richard H. Schumacher
----------------------------------
Title: Vice President
---------------------------------
DEUTSCHE FINANCIAL SERVICES CORPORATION,
as Servicer
By: /s/ Richard C. Goldman
------------------------------------
Name: Richard C. Goldman
----------------------------------
Title: Senior Vice President
---------------------------------
By: /s/ Richard H. Schumacher
------------------------------------
Name: Richard H. Schumacher
----------------------------------
Title: Senior Vice President
---------------------------------
S-1
<PAGE>
Acknowledged, accepted and agreed
to as of the day and year first above written:
The Chase Manhattan Bank,
not in its individual capacity but
solely as Indenture Trustee
By: /s/ Jo Ann Manieri
-------------------------
Name: Jo Ann Manieri
-----------------------
Title: Trust Officer
----------------------
S-2
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APPENDIX A
DEFINITIONS
"Accelerated Principal Distribution Amount" means, with respect to any
Monthly Payment Date, the portion, if any, of the Total Distribution Amount for
the related Collection Period that remains after the applications set forth in
clauses (A) through (E) of Section 5.06(a)(ii) of the Transfer and Servicing
Agreement.
"Act" has the meaning specified in Section 11.03(a) of the Indenture.
"Advance" means the amount of interest, as of the close of business on
the last day of a Collection Period, which the Servicer advances on the
Receivables pursuant to Section 5.04 of the Transfer and Servicing Agreement.
"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 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.
"Amount Financed" means with respect to a Receivable, the amount
advanced toward the purchase price of the Financed Vehicle and any related
costs.
"Annual Percentage Rate" or "APR" of a Receivable means the annual rate
of finance charges stated in the related Contract.
"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 a signature resolution, an
incumbency certificate or other similar certificate delivered by the Owner
Trustee to the Indenture Trustee on the Closing Date (as such list may be
modified or supplemented from time to time thereafter).
"Basic Documents" means the Transfer and Servicing Agreement, the
DFS/Ganis Transfer Agreement, the Ganis/Depositor Transfer Agreement, the
Indenture, the Trust Agreement and the Note Depository Agreement and the other
documents and certificates delivered in connection therewith.
"Benefit Plan" has the meaning assigned to such term in Section 11.13
of the Trust Agreement.
A-1
<PAGE>
"Book-Entry Notes" means a beneficial interest in the Notes, ownership
and transfers of which shall be made through book entries by a Clearing Agency
as described in Section 2.10 of the Indenture.
"Business Day" means any day other than a Saturday, a Sunday or a day
on which banking institutions or trust companies in the State of New York are
authorized or obligated by law, regulation or executive order to remain closed.
"Cedel" means Cedelbank, a corporation organized under the laws of the
Grand Duchy of Luxembourg.
"Cedel Item" means a "security" as defined in Section 8-102(a)(15) of
the UCC that (i) is a debt or equity security and (ii) is capable of being
transferred to the Indenture Trustee's account at Cedel pursuant to Section 5.01
of the Transfer and Servicing Agreement.
"Certificated Item" means a "certificated security" as defined in
Section 8-102(a)(4) of the UCC.
"Class" means any one of the classes of Notes, i.e., the Class A-1
Notes, the Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes, the Class
A-5 Notes, the Class A-6 Notes, the Class B Notes or the Class C Notes.
"Class A-1 Interest Rate" means 4.97% per annum (computed on the basis
of the actual number of days in each Interest Accrual Period divided by 360).
"Class A-2 Interest Rate" means 5.38% per annum (computed on the basis
of a 360-day year consisting of twelve 30-day months).
"Class A-3 Interest Rate" means 5.70% per annum (computed on the basis
of a 360-day year consisting of twelve 30-day months).
"Class A-4 Interest Rate" means 5.84% per annum (computed on the basis
of a 360-day year consisting of twelve 30-day months).
"Class A-5 Interest Rate" means 5.97% per annum (computed on the basis
of a 360-day year consisting of twelve 30-day months).
"Class A-6 Interest Rate" means 6.02% per annum (computed on the basis
of a 360-day year consisting of twelve 30-day months).
"Class B Interest Rate" means 6.36% per annum (computed on the basis of
a 360-day year consisting of twelve 30-day months).
A-2
<PAGE>
"Class C Interest Rate" means 7.23% per annum (computed on the basis of
a 360-day year consisting of twelve 30-day months).
"Class A-1 Noteholder" means the Person in whose name a Class A-1 Note
is registered in the Note Register.
"Class A-2 Noteholder" means the Person in whose name a Class A-2 Note
is registered in the Note Register.
"Class A-3 Noteholder" means the Person in whose name a Class A-3 Note
is registered in the Note Register.
"Class A-4 Noteholder" means the Person in whose name a Class A-4 Note
is registered in the Note Register.
"Class A-5 Noteholder" means the Person in whose name a Class A-5 Note
is registered in the Note Register.
"Class A-6 Noteholder" means the Person in whose name a Class A-6 Note
is registered in the Note Register.
"Class B Noteholder" means the Person in whose name a Class B Note is
registered in the Note Register.
"Class C Noteholder" means the Person in whose name a Class C Note is
registered in the Note Register.
"Class A Notes" means the Class A-1 Notes, Class A-2 Notes, Class A-3
Notes, Class A-4 Notes, Class A-5 Notes and Class A-6 Notes.
"Class A-1 Notes" means the 4.97% Asset Backed Notes, Class A-1,
substantially in the form of Exhibit A to the Indenture.
"Class A-2 Notes" means the 5.38% Asset Backed Notes, Class A-2,
substantially in the form of Exhibit A to the Indenture.
"Class A-3 Notes" means the 5.70% Asset Backed Notes, Class A-3,
substantially in the form of Exhibit A to the Indenture.
"Class A-4 Notes" means the 5.84% Asset Backed Notes, Class A-4,
substantially in the form of Exhibit A to the Indenture.
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"Class A-5 Notes" means the 5.97% Asset Backed Notes, Class A-5,
substantially in the form of Exhibit A to the Indenture.
"Class A-6 Notes" means the 6.02% Asset Backed Notes, Class A-6,
substantially in the form of Exhibit A to the Indenture.
"Class B Notes" means the 6.36% Asset Backed Notes, Class B,
substantially in the form of Exhibit A to the Indenture.
"Class C Notes" means the 7.23% Asset Backed Notes, Class C,
substantially in the form of Exhibit A to the Indenture.
"Class A-1 Stated Maturity Date" means the Monthly Payment Date in
March, 2000.
"Class A-2 Stated Maturity Date" means the Monthly Payment Date in May,
2006.
"Class A-3 Stated Maturity Date" means the Monthly Payment Date in
February 2009.
"Class A-4 Stated Maturity Date" means the Monthly Payment Date in
October, 2011.
"Class A-5 Stated Maturity Date" means the Monthly Payment Date in
August, 2013.
"Class A-6 Stated Maturity Date" means the Monthly Payment Date in
November, 2016.
"Class B Stated Maturity Date" means the Monthly Payment Date in June,
2018.
"Class C Stated Maturity Date" means the Monthly Payment Date in June,
2020.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Clearing Corporation" has the meaning specified in Section 8-102(a)(5)
of the UCC.
"Clearing Corporation Item" means securities which are in the custody
of or maintained on the books of a Clearing Corporation or a nominee subject to
the control of a Clearing Corporation and, if they are Certificated Items in
registered form, properly endorsed to or registered in the name of the Clearing
Corporation or such nominee.
"Closing Date" means March 18, 1999.
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"Code" means the Internal Revenue Code of 1986, as amended, and
Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of the
Indenture.
"Collection Account" means the account designated as such, established
and maintained pursuant to Section 5.01(a) of the Transfer and Servicing
Agreement.
"Collection Period" means a calendar month. Any amount stated as of the
last day of a Collection Period or as of the first day of a Collection Period
shall give effect to the following calculations as determined as of the close of
business on such last day: (1) all applications of collections, (2) all Advances
and reductions of Outstanding Advances and (3) all distributions to be made on
the following Monthly Payment Date.
"Commission" has the meaning specified in Section 1.02 of the
Indenture.
"Computer Tape" means the computer tape, containing information on the
DFS Receivables and the Transferor Receivables, delivered by DFS to the Issuer
on or prior to the Closing Date.
"Contract" means a retail installment sale contract or installment loan
contract relating to a recreational vehicle.
"Corporate Trust Office" or "Corporate Trust Administration Department"
means (i) the office of the Indenture Trustee at which at any particular time
its corporate trust business shall be principally administered, which office at
the date of the execution of the Indenture is located at 450 West 33rd Street
(14th Floor), New York, New York 10001; or at such other address as the
Indenture Trustee may designate from time to time by notice to the Noteholders
and the Depositor, or the principal corporate trust office of any successor
Indenture Trustee (of which address such successor Indenture Trustee shall
notify the Noteholders and the Depositor) and (ii) with respect to the Owner
Trustee, the office of the Owner Trustee located at Sixth & Marquette,
Minneapolis, Minnesota 55479-0070 or at such other address outside of New York
as the Owner Trustee may designate by notice to the Certificate Owners, the
Indenture Trustee, the Noteholders, the Residual Interestholder and the
Depositor, or the principal corporate trust office of any successor Owner
Trustee (of which address such successor Owner Trustee shall notify the Residual
Interestholder, the Indenture Trustee and the Depositor).
"Cutoff Date" means March 1, 1999.
"Dealer" means the dealer which sold a Financed Vehicle to an Obligor
and, if applicable, which originated and assigned the related Receivable to DFS
or the Transferor, as the case may be.
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"Dealer Agreement" means an agreement between a Dealer and DFS or the
Transferor, as the case may be, pursuant to which DFS or the Transferor, as the
case may be, purchased one or more Receivables.
"Default" means any occurrence that is, or with notice or the lapse of
time or both would become, an Event of Default.
"Defaulted Receivable" means a Receivable as to which (a) all or any
part of a scheduled payment is 120 days past due and the Servicer has not
repossessed the related Financed Vehicle or (b) the Servicer has repossessed and
liquidated the related Financed Vehicle, whichever occurs first.
"Definitive Notes" has the meaning specified in Section 2.10 of the
Indenture.
"Depositor" means Deutsche Recreational Asset Funding Corporation, in
its capacity as depositor under the Transfer and Servicing Agreement, and its
successors in interest.
"Depositor Conveyed Property" has the meaning specified in Section 2.01
of the Transfer and Servicing Agreement.
"Determination Date" means, with respect to any Monthly Payment Date
and the Collection Period immediately preceding such Monthly Payment Date, the
Business Day immediately preceding such Monthly Payment Date.
"DFS" means Deutsche Financial Services Corporation, a Nevada
corporation, or its successors in interest.
"DFS Conveyed Property" has the meaning specified in Section 2.01 of
the DFS/Ganis Transfer Agreement.
"DFS Receivables" has the meaning specified in Section 2.01 of the
DFS/Ganis Transfer Agreement.
"DFS/Ganis Transfer Agreement" means the DFS/Ganis Transfer Agreement
dated as of March 1, 1999 between DFS and Ganis, as amended, amended and
restated or otherwise modified from time to time.
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"Eligible Deposit Account" means either (1) a segregated account with
an Eligible Institution or (2) a segregated trust account with the corporate
trust department of a depository institution organized under the laws of the
United States of America or any one of the states thereof or the District of
Columbia (or any domestic branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so long as any
of the securities of such depository institution shall have a credit rating from
each Rating Agency in one of its generic rating categories that signifies
investment grade.
"Eligible Institution" means (1) the corporate trust department of the
Indenture Trustee or the Owner Trustee, or (2) a depository institution
organized under the laws of the United States of America or any one of the
states thereof or the District of Columbia (or any domestic branch of a foreign
bank), (i) which has either (A) a long-term unsecured debt rating of AAA by
Standard & Poor's and AAA by Fitch or (B) a certificate of deposit rating of
A-1+ by Standard & Poor's and F1+ by Fitch, or any other long-term, short-term
or certificate of deposit rating acceptable to the Rating Agencies and (ii)
whose deposits are insured by the FDIC. If so qualified, the Indenture Trustee
or the Owner Trustee may be considered an Eligible Institution for the purposes
of clause (2) of this definition.
"Eligible Investments" means book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:
(1) direct obligations of, and obligations fully guaranteed as to
the full and timely payment by, the United States of America;
(2) demand deposits, time deposits or certificates of deposit of any
depository institution or trust company incorporated under the laws of the
United States of America or any state thereof (or any domestic branch of a
foreign bank) and subject to supervision and examination by Federal or State
banking or depository institution authorities; provided, however, that at the
time of the investment or contractual commitment to invest therein, the
commercial paper or other short-term unsecured debt obligations (other than such
obligations the rating of which is based on the credit of a Person other than
such depository institution or trust company) thereof shall have a credit rating
from each of the Rating Agencies in the highest investment category granted
thereby;
(3) commercial paper having, at the time of the investment or
contractual commitment to invest therein, a rating from each of the Rating
Agencies in the highest investment category granted thereby;
(4) investments in money market funds having a rating from each of the
Rating Agencies in the highest investment category granted thereby (including
funds for which the Indenture Trustee or the Owner Trustee or any of their
respective Affiliates is investment manager or advisor);
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(5) bankers' acceptances issued by any depository institution or trust
company referred to in clause (2) above;
(6) repurchase obligations with respect to any security that is a
direct obligation of, or fully guaranteed by, the United States of America or
any agency or instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either case entered
into with a depository institution or trust company (acting as principal)
described in clause (2);
(7) repurchase obligations with respect to any security or whole loan,
entered into with (i) a depository institution or trust company (acting as
principal) described in clause (2) above (except that the rating referred to in
the proviso in such clause (b) shall be A-1 or higher in the case of Standard &
Poor's) (such depository institution or trust company being referred to in this
definition as a "financial institution"), (ii) a broker/dealer (acting as
principal) registered as a broker or dealer under Section 15 of the Exchange Act
(a "broker/dealer") the unsecured short-term debt obligations of which are rated
F1+ by Fitch and at least A-1 by Standard & Poor's at the time of entering into
such repurchase obligation (a "rated broker/dealer"), (iii) an unrated
broker/dealer (an "unrated broker/dealer"), acting as principal, that is a
wholly-owned subsidiary of a non-bank holding company the unsecured short-term
debt obligations of which are rated F1+ by Fitch and at least A-1 by Standard &
Poor's at the time of entering into such repurchase obligation (a "Rated Holding
Company") or (iv) an unrated subsidiary (a "Guaranteed Counterparty"), acting as
principal, that is a wholly-owned subsidiary of a direct or indirect parent
Rated Holding Company, which guarantees such subsidiary's obligations under such
repurchase agreement; provided that the following conditions are satisfied:
(A) the aggregate amount of funds invested in repurchase
obligations of a financial institution, a rated broker/dealer, an
unrated broker/dealer or Guaranteed Counterparty in respect of which
the Standard & Poor's unsecured short-term ratings are A-1 (in the case
of an unrated broker/dealer or Guaranteed Counterparty, such rating
being that of the related Rated Holding Company) shall not exceed 20%
of the sum of the then outstanding principal balance of the Notes
(there being no limit on the amount of funds that may be invested in
repurchase obligations in respect of which such Standard & Poor's
rating is A-1+ (in the case of an unrated broker/dealer or Guaranteed
Counterparty, such rating being that of the related Rated Holding
Company));
(B) in the case of the Reserve Account, the rating from
Standard & Poor's in respect of the unsecured short-term debt
obligations of the financial institution, rated broker/dealer, unrated
broker/dealer or Guaranteed Counterparty (in the case of an unrated
broker/dealer or Guaranteed Counterparty, such rating being that of the
related Rated Holding Company) shall be A-1+;
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(C) the repurchase obligation must mature within 30 days of
the date on which the Indenture Trustee or the Issuer, as applicable,
enters into such repurchase obligation;
(D) the repurchase obligation shall not be subordinated to any
other obligation of the related financial institution, rated
broker/dealer, unrated broker/dealer or Guaranteed Counterparty;
(E) the collateral subject to the repurchase obligation is
held, in the appropriate form, by a custodial bank on behalf of the
Indenture Trustee or the Issuer, as applicable;
(F) the repurchase obligation shall require that the
collateral subject thereto shall be marked to market daily;
(G) in the case of a repurchase obligation of a Guaranteed
Counterparty, the following conditions shall also be satisfied:
(i) the Indenture Trustee or the Issuer, as
applicable, shall have received an opinion of counsel (which
may be in- house counsel) to the effect that the guarantee of
the related Rated Holding Company is a legal, valid and
binding agreement of the Rated Holding Company, enforceable in
accordance with its terms, subject as to enforceability to
bankruptcy, insolvency, reorganization and moratorium or other
similar laws affecting creditors' rights generally and to
general equitable principles;
(ii) the Indenture Trustee or the Issuer, as
applicable, shall have received (x) an incumbency certificate
for the signer of such guarantee, certified by an officer of
such Rated Holding Company and (y) a resolution, certified by
an officer of the Rated Holding Company, of the board of
directors (or applicable committee thereof) of the Rated
Holding Company authorizing the execution, delivery and
performance of such guarantee by the Rated Holding Company;
(iii) the only conditions to the obligation of such
Rated Holding Company to pay on behalf of the Guaranteed
Counterparty shall be that the Guaranteed Counterparty shall
not have paid under such repurchase obligation when required
(it being understood that no notice to, demand on or other
action in respect of the Guaranteed Counterparty is necessary)
and that the Indenture Trustee or the Issuer shall make a
demand on the Rated Holding Company to make the payment due
under such guarantee;
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(iv) the guarantee of the Rated Holding Company shall
be irrevocable with respect to such repurchase obligation and
shall not be subordinated to any other obligation of the Rated
Holding Company; and
(v) each of Standard & Poor's and Fitch has confirmed
in writing to the Indenture Trustee or Issuer, as applicable,
that it has reviewed the form of the guarantee of the Rated
Holding Company and has determined that the issuance of such
guarantee shall not result in the downgrade or withdrawal of
the ratings assigned to the Notes.
(H) the repurchase obligation shall require that the
repurchase obligation be overcollateralized and shall provide that,
upon any failure to maintain such overcollateralization, the repurchase
obligation shall become due and payable, and unless the repurchase
obligation is satisfied immediately, the collateral subject to the
repurchase agreement shall be liquidated and the proceeds applied to
satisfy the unsatisfied portion of the repurchase obligation;
(8) any other investment with respect to which the Issuer or the
Servicer has received written notification from the Rating Agencies that the
acquisition of such investment as an Eligible Investment shall not result in a
withdrawal or downgrading of the ratings on the Notes.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Euroclear Item" means a "security" as defined in Section 8-102(a)(15)
of the UCC that (i) is a debt or equity security and (ii) is capable of being
transferred to the Indenture Trustee's account at Euroclear pursuant to Section
5.01 of the Transfer and Servicing Agreement.
"Event of Default" has the meaning specified in Section 5.01 of the
Indenture.
"Excess Overcollateralization Amount" means, with respect to each
Monthly Payment Date, the excess, if any, of (i) the Overcollateralization
Amount over (ii) the Targeted Overcollateralization Amount (after application of
payments in reduction of the principal amounts of the Notes on such Monthly
Payment Date).
"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
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President, the Secretary or the Treasurer of such corporation; and with respect
to any partnership, any general partner thereof.
"Expenses" has the meaning specified in Section 8.02 of the Trust
Agreement.
"FDIC" means the Federal Deposit Insurance Corporation or any successor
organization.
"Fidelity Bond" means a fidelity bond to be maintained by the Servicer
pursuant to Section 4.15 of the Transfer and Servicing Agreement.
"Final Certification" has the meaning specified in Section 3.02 of the
Transfer and Servicing Agreement.
"Final Scheduled Maturity Date" means the Monthly Payment Date
immediately following the latest scheduled maturity date of the Receivables.
"Final Scheduled Payment Date" means, with respect to any Class of
Notes, the Stated Maturity Date of such Class of Notes.
"Financed Vehicle" means a new or used recreational vehicle, together
with all accessions thereto, securing an Obligor's indebtedness under the
respective Receivable.
"Fitch" means Fitch IBCA, Inc. or its successor.
"Ganis" means Ganis Credit Corporation, a Delaware corporation, or its
successors in interest.
"Ganis/Depositor Transfer Agreement" means the Ganis/Depositor Transfer
Agreement dated as of March 1, 1999 between Ganis and the Depositor, as the same
may be amended, amended and restated or otherwise modified from time to time.
"Government Item" means a security (other than a security issued by the
Government National Mortgage Association) issued or guaranteed by the United
States of America or an agency or instrumentality thereof representing a full
faith and credit obligation of the United States of America and, with respect to
each of the foregoing, that is maintained in book-entry on the records of a
Federal Reserve Bank.
"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 a right of set-off against pursuant to the Indenture. A
Grant of the Collateral or of any other agreement or instrument shall include
all rights, powers and options (but none of the obligations) of the granting
party thereunder, including the immediate and continuing right to claim for,
collect,
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receive and give receipt for principal and interest payments in respect of the
Collateral 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 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" means the Person in whose name a Note is registered on the
Note Register.
"Indemnified Parties" shall have the meaning specified in Section 8.02
of the Trust Agreement.
"Indenture" means the Indenture dated as of March 1, 1999 between the
Issuer and the Indenture Trustee, as the same may be amended, amended and
restated, supplemented or otherwise modified from time to time.
"Indenture Trustee" means The Chase Manhattan Bank, a New York banking
corporation, as Indenture Trustee under the Indenture, or any successor
Indenture Trustee under the Indenture.
"Independent" means, when used with respect to any specified Person,
that the Person (a) is in fact independent of the Issuer, any other obligor on
the Notes, the Depositor 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 or any Affiliate
of any of the foregoing Persons and (c) is not connected with the Issuer, any
such other obligor, the Depositor 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 Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01 of the
Indenture, made by an Independent appraiser or other expert appointed by an
Issuer Order, and such opinion or certificate shall state that the signer has
read the definition of "Independent" in the Indenture and that the signer is
Independent within the meaning thereof.
"Independent Director" has the meaning specified in the articles of
incorporation of the Depositor.
"Initial Pool Balance" means $1,000,003,403.
"Insolvency Event" means, with respect to a specified Person, (1) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property in an
involuntary case under any applicable federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official for
such Person or for any substantial part of its property, or ordering the
winding-up or liquidation of such Person's affairs, and such decree or order
shall remain unstayed and in effect for a period of 60 consecutive days; or (2)
the commencement by such Person of a voluntary case under any applicable federal
or state bankruptcy, insolvency or other similar law now or hereafter in effect,
or the consent by such Person to the entry of an order for relief in an
involuntary case under any such law, or the consent by such Person to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official for such Person or for any
substantial part of its property, or the making by such Person of any general
assignment for the benefit of creditors, or the failure by such Person generally
to pay its debts as such debts become due, or the taking of action by such
Person in furtherance of any of the foregoing.
"Instrument" has the meaning specified in Section 9-105(1)(i) of the
UCC.
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"Insurance Policy" means, with respect to a Receivable, any insurance
policy benefiting the holder of the Receivable providing loss or physical
damage, credit life, credit disability, theft, mechanical breakdown or similar
coverage with respect to the Financed Vehicle or the Obligor.
"Interest Accrual Period" means the period from (and including) the
immediately preceding Monthly Payment Date (or in the case of the first Monthly
Payment Date, from and including the Closing Date) to and including the day
preceding the applicable Monthly Payment Date.
"Interest Rate" means the interest rate for any one or more of the
Classes of Notes, or collectively for all Classes of Notes, in each case as the
context requires.
"Investment Earnings" means the realized investment earnings (net of
losses and investment expenses) on amounts on deposit in the Trust Accounts.
"Issuer" means Distribution Financial Services RV Trust 1999-1, a New
York common law trust, 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" or "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 Indenture Trustee.
"Lien" means a security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than tax liens, mechanics' liens and any liens
that attach to a Receivable by operation of law as a result of any act or
omission by the related Obligor.
"Lien Certificate" means, with respect to a Financed Vehicle, an
original certificate of title, certificate of lien or other notification issued
by the Registrar of Titles of the applicable State to a secured party which
indicates that the lien of the secured party on the Financed Vehicle is recorded
on the original certificate of title. In any jurisdiction in which the original
certificate of title is required to be given to the Obligor, the term "Lien
Certificate" means only a certificate or notification issued to a secured party
by such Registrar of Titles.
"Liquidation Proceeds" means, with respect to any Defaulted Receivable,
the monies collected in respect thereof, from whatever source, on such Defaulted
Receivable during the Collection Period in which such Receivable became a
Defaulted Receivable, net of the sum of any amounts of expenses incurred by the
Servicer in connection with such liquidation and any amounts required by law to
be remitted to the Obligor on such Defaulted Receivable.
"Majority Noteholders" means the Holders of Notes representing not less
than a majority of the Outstanding Amount of the Notes.
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"Monthly Payment Date" means, with respect to each Collection Period,
the 15th day of the following month or, if such day is not a Business Day, the
immediately following Business Day, commencing on April 15, 1999.
"Note" means any Class A Note, Class B Note or Class C Note.
"Note Depository Agreement" means the agreement dated the Closing Date
among the Trust, the Indenture Trustee, and The Depository Trust Company, as the
initial Clearing Agency, relating to the Notes, as the same may be amended,
amended and restated or otherwise modified from time to time.
"Note Distribution Account" means the account designated as such,
established and maintained pursuant to Section 5.01 of the Transfer and
Servicing Agreement.
"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 Clearing Agency or on the books of a Person maintaining an account with such
Clearing Agency (directly as a Clearing Agency Participant or as an indirect
participant, in each case in accordance with the rules of such Clearing Agency).
"Note Pool Factor" means, with respect to each Class of Notes as of the
close of business on the last day of a Collection Period, a seven-digit decimal
figure equal to the outstanding principal balance of such Class of Notes (after
giving effect to any reductions thereof to be made on the immediately following
Monthly Payment Date) divided by the original outstanding principal balance of
such Class of Notes. The Note Pool Factor shall be 1.0000000 as of the Closing
Date; thereafter, the Note Pool Factor shall decline to reflect reductions in
the outstanding principal balance of such Class of Notes.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.04 of the Indenture.
"Noteholder" means the Person in whose name a Note is registered on the
Note Register.
"Noteholders' Distributable Amount" means, with respect to any Monthly
Payment Date, the sum of the Noteholders' Monthly Principal Distributable Amount
and the Noteholders' Interest Distributable Amount for such Monthly Payment
Date.
"Noteholders' Excess Distributable Amount" means, with respect to each
Monthly Payment Date, the lesser of (i) the Accelerated Principal Distribution
Amount and (ii) the amount, if any, necessary after application of the
Noteholders' Regular Principal Distribution Amount for such Monthly Payment
Date, to reduce the aggregate principal amount of the Notes so that the
Overcollateralization Amount shall equal the Targeted Overcollateralization
Amount
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(after application of payments in reduction of the aggregate principal amount of
the Notes on such Monthly Payment Date).
"Noteholders' Interest Carryover Shortfall" means, with respect to any
Monthly Payment Date, the result of (a) the excess of the Noteholders' Interest
Distributable Amount for the immediately preceding Monthly Payment Date, over
the amount in respect of interest that is actually deposited in the Note
Distribution Account on such immediately preceding Monthly Payment Date, plus
(b) interest on the amount of interest due but not paid to Noteholders on the
preceding Monthly Payment Date, to the extent permitted by law, at the
respective Interest Rates borne by each Class of the Notes for the related
Interest Accrual Period.
"Noteholders' Interest Distributable Amount" means, with respect to any
Monthly Payment Date, the sum of the Noteholders' Monthly Interest Distributable
Amount for such Monthly Payment Date and the Noteholders' Interest Carryover
Shortfall for such Monthly Payment Date. For all purposes of the Transfer and
Servicing Agreement and the other Basic Documents, interest with respect to the
Notes shall be computed on the basis of twelve 30-day months in a 360-day year
except for the Class A-1 Notes which shall be calculated on the basis of the
actual number days in a year divided by 360.
"Noteholders' Monthly Interest Distributable Amount" means, with
respect to any Monthly Payment Date, interest accrued for the related Interest
Accrual Period on each Class of Notes at the respective Interest Rate for such
Class on the outstanding principal balance of the Notes of such Class, which
outstanding principal balance shall be calculated as of the immediately
preceding Monthly Payment Date (or, in the case of the first Monthly Payment
Date, as of the Closing Date), after giving effect to all payments in reduction
of the aggregate principal amount of the Notes of such Class on or prior to such
immediately preceding Monthly Payment Date.
"Noteholders' Monthly Principal Distributable Amount" means, with
respect to any Monthly Payment Date, the lesser of (i) the sum of the Regular
Principal Distribution Amount plus the Accelerated Principal Distribution Amount
for such Monthly Payment Date and (ii) the amount, if any, necessary to reduce
the aggregate principal amount of the Notes so that the Overcollateralization
Amount shall equal the Targeted Overcollateralization Amount after application
of payments for such Monthly Payment Date in reduction of the aggregate
principal amount of the Notes; provided that on and after the Stated Maturity
Date for any Class or Classes of Notes, the Noteholders' Monthly Principal
Distributable Amount shall be calculated as an amount which is not less than the
amount required to reduce the aggregate principal amount of the Notes of such
Class or Classes to zero.
"Noteholders' Regular Principal Distributable Amount" means, with
respect to each Monthly Payment Date, the lesser of (i) the Regular Principal
Distribution Amount and (ii) the amount, if any, necessary to reduce the
aggregate principal amount of the Notes so that the Overcollateralization Amount
shall equal the Targeted Overcollateralization Amount after
A-15
<PAGE>
application of payments in reduction of the aggregate principal amount of the
Notes on such Monthly Payment Date; provided that on and after the Stated
Maturity Date for any Class or Classes of Notes, the Noteholders' Regular
Principal Distributable Amount shall be calculated as an amount which is not
less than the amount required to reduce the aggregate principal amount of the
Notes of such Class or Classes to zero.
"Notes" means the Class A Notes, the Class B Notes and the Class C
Notes.
"Obligor" on a Receivable means the purchaser or co-purchasers of the
Financed Vehicle and any other Person who owes payments under the Receivable.
"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 of the Indenture,
and delivered to the Indenture Trustee and, with respect to any other Basic
Document, means a certificate signed by (i) any vice president and (ii) the
president, treasurer, assistant treasurer, secretary or assistant secretary of
the Servicer (or any other Person specified in any such Basic Document as
delivering an Officer's Certificate). Unless otherwise specified, any reference
in the Indenture to an Officer's Certificate shall be to an Officer's
Certificate signed by 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 the Indenture, be an employee of
or counsel to the Issuer, the Servicer, the Transferor or the Depositor and who
shall be satisfactory to the Indenture Trustee, and which opinion or opinions
shall be addressed to the Indenture Trustee as Indenture Trustee, shall comply
with any applicable requirements of Section 11.01 of the Indenture and shall be
in form satisfactory to the Indenture Trustee.
"Original Trust Agreement" is defined in the preamble to the Trust
Agreement.
"Outstanding" means, as of any date of determination, all Notes
theretofore authenticated and delivered under the Indenture except:
(i) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in
the necessary amount has been theretofore deposited with the Indenture
Trustee or any Paying Agent in trust for the Holders of such Notes
(provided, however, that if such Notes are to be redeemed, notice of
such redemption has been duly given pursuant to the Indenture or
provision for such notice has been made, satisfactory to the Indenture
Trustee); and
A-16
<PAGE>
(iii) Notes in exchange for or in lieu of which other Notes
have been authenticated and delivered pursuant to the Indenture unless
proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a bona fide purchaser;
provided, that in determining whether the Holders of the requisite
Outstanding Amount of the Notes have given any request, demand,
authorization, direction, notice, consent or waiver under any Basic
Document, (x) Notes owned by the Issuer, any other obligor upon the
Notes, the Depositor, the Transferor or any Affiliate of any of the
foregoing Persons shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Indenture Trustee
shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that
the Indenture Trustee knows to be so owned shall be so disregarded
(Notes so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the
Indenture Trustee the pledgee's right so to act with respect to such
Notes and that the pledgee is not the Issuer, any other obligor upon
the Notes, the Depositor, the Transferor or any Affiliate of any of the
foregoing Persons), and (y) clause (ii) of this definition of
Outstanding shall be disregarded; provided further, that when monies
referred to in clause (ii) of this definition are payable to
Noteholders, then the related Notes shall be deemed to be Outstanding
until the principal balances of such Notes shall have been reduced to
zero.
"Outstanding Amount" means the aggregate principal amount of all Notes,
or Class of Notes, as applicable, Outstanding at the date of determination.
"Outstanding Advances" on the Receivables means the sum, as of the
close of business on the last day of a Collection Period, of all Advances as
reduced as provided in Section 5.04 of the Transfer and Servicing Agreement.
"Overcollateralization Amount" means, with respect to any Monthly
Payment Date, the amount, if any, by which the Pool Balance as of the end of the
related Collection Period exceeds the aggregate Outstanding Amount of the Notes.
"Owner Trust Estate" means all right, title and interest of the Trust
in and to the property and rights assigned to the Trust pursuant to Article II
of the Transfer and Servicing Agreement, all funds on deposit from time to time
in the Trust Accounts and all other property of the Trust from time to time,
including any rights of the Owner Trustee and the Trust pursuant to the Transfer
and Servicing Agreement.
"Owner Trustee" means Norwest Bank Minnesota, National Association, a
national banking association, not in its individual capacity but solely as owner
trustee under the Trust Agreement, and any successor Owner Trustee thereunder.
A-17
<PAGE>
"Paying Agent" means the Indenture Trustee or any other Person that
meets the eligibility standards for the Indenture Trustee specified in Section
6.11 of the Indenture and is authorized by the Issuer to make payments to and
distributions from the Collection Account and the Note Distribution Account,
including payments of principal of or interest on the Notes on behalf of the
Issuer.
"Person" means any individual, corporation, limited liability company,
estate, partnership, joint venture, association, joint stock company, trust
(including any beneficiary thereof), unincorporated organization or government
or any agency or political subdivision thereof.
"Pool Balance" means, as of the close of business on the last day of a
Collection Period, the aggregate Principal Balance of the Receivables as of such
day (excluding Purchased Receivables and Defaulted Receivables).
"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 of the Indenture in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.
"Principal Balance" means, with respect to a Receivable, as of the
close of business on the last day of a Collection Period, the Amount Financed
minus the sum of (i) the portion of all payments made by or on behalf of the
related Obligor on or prior to such date and allocable to principal using the
Simple Interest Method and (ii) any payment of the Purchase Amount for such
Receivable allocable to principal.
"Proceeding" means any suit in equity, action at law or other judicial
or administrative proceeding.
"Purchase Amount" means the amount, as of the close of business on the
last day of a Collection Period, required to prepay in full a Receivable under
the terms thereof including interest to the end of such Collection Period.
"Purchased Receivable" means a Receivable purchased as of the close of
business on the last day of a Collection Period by the Servicer pursuant to
Section 4.07 of the Transfer and Servicing Agreement, by DFS pursuant to Section
3.01 of the DFS/Ganis Transfer Agreement, by the Transferor pursuant to Section
3.01 of the Ganis/Depositor Transfer Agreement, or by the Depositor pursuant to
Section 3.01 of the Transfer and Servicing Agreement.
"Rating Agency" means Fitch and Standard & Poor's or, if no such
organization or successor is any longer in existence, a nationally recognized
statistical rating organization or
A-18
<PAGE>
other comparable Person designated by the Depositor, notice of which designation
shall be given to the Indenture Trustee, the Owner Trustee and the Servicer.
"Rating Agency Condition" means, with respect to any action, that each
Rating Agency shall have been given 10 Business Days (or such shorter period as
is acceptable to each Rating Agency) prior notice thereof and that each of the
Rating Agencies shall have notified any of the Depositor, the Servicer, the
Indenture Trustee, the Owner Trustee or the Issuer in writing that such action
shall not result in a qualification, reduction or withdrawal of the then current
rating of any Class of the Notes.
"Realized Loss" means, with respect to any Receivable that becomes a
Defaulted Receivable during any Collection Period, the excess of the Principal
Balance of such Defaulted Receivable over all Liquidation Proceeds or other
amounts received by the Servicer with respect to such Receivable to the extent
allocable to principal during such Collection Period.
"Receivable" means any Contract listed on Schedule A to the Transfer
and Servicing Agreement (which Schedule may be in the form of microfiche,
computer tape or other computer-readable form).
"Receivable Files" means the documents specified in Section 3.02 of the
Transfer and Servicing Agreement.
"Record Date" means, with respect to any Monthly Payment Date
(including the Redemption Date), the close of business on the day immediately
preceding such Monthly Payment Date or, if Definitive Notes have been issued
pursuant to Section 2.12 of the Indenture, the last day of the month immediately
preceding such Monthly Payment Date.
"Recoveries" means, with respect to any Receivable that becomes a
Defaulted Receivable, monies collected in respect thereof, from whatever source,
during any Collection Period following the Collection Period in which such
Receivable became a Defaulted Receivable, net of the sum of (i) any amounts
expended by the Servicer for the account of the Obligor and (ii) any amounts
required by law to be remitted to the Obligor.
"Redemption Date" is defined in Section 10.01 of the Indenture.
"Redemption Price" means, in the case of a redemption of the Notes
pursuant to Section 10.01 of the Indenture, an amount equal to the unpaid
principal amount of the Notes redeemed plus accrued and unpaid interest thereon
at the respective Interest Rates for each Class of Notes being so redeemed
through the end of the Interest Accrual Period relating to the applicable
Monthly Payment Date.
"Registered Holder" means the Person in whose name a Note is registered
on the Note Register on the applicable Record Date.
A-19
<PAGE>
"Registrar of Titles" means, with respect to any state, the
governmental agency or body responsible for the registration of, and the
issuance of certificates of title relating to, motor vehicles and liens thereon.
"Regular Principal Distribution Amount" means, with respect to any
Monthly Payment Date, the sum of the following amounts, without duplication,
with respect to the Receivables in respect of the Collection Period preceding
such Monthly Payment Date: (i) that portion of all collections on Receivables
allocable to principal, (ii) all Liquidation Proceeds or other collections
attributable to the principal amount of Receivables that became Defaulted
Receivables during such Collection Period, plus the amount of Realized Losses
with respect to the Defaulted Receivables, (iii) to the extent attributable to
principal, the Purchase Amount of each Receivable that became a Purchased
Receivable during such Collection Period and (iv) partial payments relating to
refunds of extended warranty protection plan costs or of physical damage, credit
life or disability insurance policy premiums, but only if such costs or premiums
were financed by the respective Obligors thereon as of the date of the original
Contract and only to the extent not included under clause (i) above.
"Reserve Account" means the account designated as such, established and
maintained pursuant to Section 5.01(a) of the Transfer and Servicing Agreement.
"Reserve Account Initial Deposit" means an amount equal to $5,000,000.
"Residual Interest" means the beneficial undivided ownership interest
in the Trust.
"Residual Interestholder" means the Depositor in its capacity as the
owner of the Residual Interest.
"Residual Interestholder Distribution Account" has the meaning
specified in Section 5.01 of the Trust Agreement.
"Responsible Officer" means, with respect to the Indenture Trustee, any
Trust Officer thereof.
"Schedule of Receivables" means the list of the Receivables set forth
in Schedule A to the Transfer and Servicing Agreement (which Schedule may be in
the form of microfiche or computer tape or other computer-readable form).
"Secretary of State" means the Secretary of State of the State of
Delaware.
"Securities" means the Notes.
"Securities Act" means the Securities Act of 1933, as amended.
A-20
<PAGE>
"Servicer" means DFS, as the servicer of the Receivables, and each
successor to DFS (in the same capacity).
"Servicer Default" has the meaning specified in Section 8.01 of the
Transfer and Servicing Agreement.
"Servicer's Certificate" means a certificate of the Servicer delivered
pursuant to Section 4.09 of the Transfer and Servicing Agreement, substantially
in the form of Exhibit B thereto.
"Servicing Fee" means the fee payable to the Servicer for services
rendered during each Collection Period, determined pursuant to Section 4.08 of
the Transfer and Servicing Agreement.
"Servicing Fee Rate" means fifty basis points (.50%) per annum.
"Simple Interest Method" means the method of allocating a payment with
respect to a Receivable to principal and interest, pursuant to which the portion
of such payment that is allocated to interest is equal to the product of the
stated APR multiplied by the unpaid principal balance of the Receivable
multiplied by the period of time elapsed (as a fraction of a calendar year)
since the preceding payment of interest was made and the remainder of such
payment is allocable to reduce the principal.
"Specified Accountants" means KPMG LLP.
"Specified Agreement" has the meaning set forth in Section 2.13(a) of
the Trust Agreement.
"Specified Reserve Account Balance" means, with respect to any Monthly
Payment Date, two percent (2%) of the Pool Balance as of the close of business
on the last day of the immediately preceding Collection Period; provided,
however, that the Specified Reserve Account Balance shall not be less than
seventy-five basis points (0.75%) of the Initial Pool Balance. Notwithstanding
the preceding sentence, the Specified Reserve Account Balance shall not exceed
the outstanding principal balance of the Notes.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc., or its successor.
"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) the Class A-1 Notes,
the Class A-1 Stated Maturity Date; (ii) the Class A-2 Notes, the Class A-2
Stated Maturity Date; (iii) the Class A-3 Notes, the Class A-3 Stated Maturity
Date; (iv) the Class A-4 Notes, the Class A-4
A-21
<PAGE>
Stated Maturity Date; (v) the Class A-5 Notes, the Class A-5 Stated Maturity
Date; (vi) the Class A-6 Notes, the Class A-6 Stated Maturity Date; (vii) the
Class B Notes, the Class B Stated Maturity Date; and (viii) the Class C Notes,
the Class C Stated Maturity Date.
"Step Rate Receivable" means a Receivable which provides that the APR
will increase to a different fixed rate from time to time during the term of
such Receivable.
"Successor Servicer" has the meaning specified in Section 3.07(e) of
the Indenture.
"Targeted Overcollateralization Amount" means, with respect to any
Monthly Payment Date, an amount equal to one percent (1%) of the Pool Balance as
of the end of the preceding Collection Period.
"Total Distribution Amount" means, with respect to any Monthly Payment
Date, the sum of the following amounts, without duplication, with respect to the
Receivables in respect of the Collection Period preceding such Monthly Payment
Date: (1) all collections on Receivables allocable to interest and principal,
(2) all Liquidation Proceeds or other collections attributable to accrued
interest on or the principal amount of Receivables that became Defaulted
Receivables during such Collection Period, plus the amount of Realized Losses
with respect to the Defaulted Receivables, (3) all Advances made by the
Servicer, (4) the Purchase Amount of each Receivable that became a Purchased
Receivable during such Collection Period, (5) all Recoveries and (6) partial
payments relating to refunds of extended warranty protection plan costs or of
physical damage, credit life or disability insurance policy premiums, but only
if such costs or premiums were financed by the respective Obligors thereon as of
the date of the original contract and only to the extent not included under
clause (1) above; provided, however, that in calculating the Total Distribution
Amount the following shall be excluded: (i) all payments and proceeds (including
Liquidation Proceeds) of any Purchased Receivables, the Purchase Amount of which
has been included in the Total Distribution Amount in a prior Collection Period;
(ii) amounts received in respect of interest on the Receivables (which amounts
shall be determined based on the Simple Interest Method) during such preceding
Collection Period in excess of the amount of interest that would be due on the
aggregate Principal Balance of the Receivables during such Collection Period at
their respective APRs if a payment were received on each Receivable during such
Collection Period on the date payment is due under the terms of such Receivable;
(iii) late payments of interest to the extent applied to reimbursement of
Servicer Advances; and (iv) Liquidation Proceeds with respect to a Receivable
attributable to accrued and unpaid interest thereon (but not including interest
for the then current Collection Period) but only to the extent of any
unreimbursed Advances.
"Transfer and Servicing Agreement" means the Transfer and Servicing
Agreement dated as of March 1, 1999 among the Issuer, the Depositor, and DFS, as
Servicer, as the same may be amended, amended and restated or otherwise modified
from time to time.
"Transferor" means Ganis.
A-22
<PAGE>
"Transferor Conveyed Property" has the meaning specified in Section
3.01 of the Ganis/Depositor Transfer Agreement.
"Transferor Receivables" has the meaning specified in Section 2.01 of
the Ganis/Depositor Transfer Agreement.
"Treasury Regulations" means regulations, including proposed or
temporary Regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Trust" means the Issuer.
"Trust Account Property" means the Trust Accounts, all amounts and
investments held from time to time in any Trust Account (whether in the form of
deposit accounts, Physical Property, book-entry securities, uncertificated
securities or otherwise), and all proceeds of the foregoing.
"Trust Accounts" has the meaning specified in Section 5.01 in the
Transfer and Servicing Agreement.
"Trust Agreement" means the Amended and Restated Trust Agreement dated
as of March 1, 1999 between the Depositor and the Owner Trustee, as the same may
be further amended, amended and restated or otherwise modified from time to
time.
"Trust Estate" means all money, instruments, rights and other property
that are subject or intended to be subject to the lien and security interest of
the Indenture for the benefit of the Noteholders (including, without limitation,
all property and interests Granted to the Indenture Trustee), including all
proceeds thereof.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as
in force on the Closing Date, unless otherwise specifically provided.
"Trust Officer" means (i) in the case of the Indenture Trustee, any
officer within the Corporate Trust Office of the Indenture Trustee, including
any Vice President, Assistant Vice President, Senior Trust Officer, Trust
Officer, Secretary, Assistant Secretary or any other officer of the Indenture
Trustee customarily performing functions similar to those performed by any of
the above designated officers and also, with respect to a particular matter, any
other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject, and (ii) in the case
of the Owner Trustee, any officer in the Corporate Trust Administration
Department of the Owner Trustee with direct responsibility for the
administration of the Trust Agreement and the other Basic Documents on behalf of
the Owner Trustee.
A-23
<PAGE>
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from time
to time.
"Uncertificated Item" means an "uncertificated security" as defined in
Section 8-102(a)(18) of the UCC.
A-24
<PAGE>
SCHEDULE A
Schedule of Receivables
Delivered to the Owner Trustee and Indenture Trustee at Closing
A-25
<PAGE>
SCHEDULE B
Location of Receivable Files
660 Newport Center Drive
Newport Beach, CA 92660
A-26
<PAGE>
EXHIBIT A
DISTRIBUTION FINANCIAL SERVICES RV TRUST 1999-1
MONTHLY PAYMENT DATE STATEMENT TO NOTEHOLDERS
Pool Balance
Distribution Allocable to Principal on Notes
Class A-1 Notes: ($ per $1,000 original principal amount)
Class A-2 Notes: ($ per $1,000 original principal amount)
Class A-3 Notes: ($ per $1,000 original principal amount)
Class A-4 Notes: ($ per $1,000 original principal amount)
Class A-5 Notes: ($ per $1,000 original principal amount)
Class A-6 Notes: ($ per $1,000 original principal amount)
Class B Notes: ($ per $1,000 original principal amount)
Class C Notes: ($ per $1,000 original principal amount)
Distribution Allocable to Interest on Notes
Class A-1 Notes: ($ per $1,000 original principal amount)
Class A-2 Notes: ($ per $1,000 original principal amount)
Class A-3 Notes: ($ per $1,000 original principal amount)
Class A-4 Notes: ($ per $1,000 original principal amount)
Class A-5 Notes: ($ per $1,000 original principal amount)
Class A-6 Notes: ($ per $1,000 original principal amount)
Class B Notes: ($ per $1,000 original principal amount)
Class C Notes: ($ per $1,000 original principal amount)
Note Balance After Giving Effect to Principal Distributions on Notes Class A-1
Notes Class A-2 Notes Class A-3 Notes Class A-4 Notes Class A-5 Notes Class
A-6 Notes Class B Notes Class C Notes
Note Pool Factor
Class A-1 Notes
Class A-2 Notes
Class A-3 Notes
Class A-4 Notes
Class A-5 Notes
A-1
<PAGE>
Class A-6 Notes
Class B Notes
Class C Notes
Servicing Fee
Servicing Fee Per $1,000 Note
Realized Losses
Reserve Account Balance
Payments Received with Respect to Receivables During Most Recently Ended
Collection Period
Amounts Allocated or Distributed on the Preceding Monthly Payment Date
(including reconciliation of such amounts with information provided by the
Servicer prior to current Monthly Payment Date)
Distribution to Residual Interestholder
Noteholders' Interest Carryover Shortfall, if any
Aggregate Purchase Amounts for Receivables, if any, that were purchased in the
related Collection Period
A-2
<PAGE>
EXHIBIT B
SERVICER'S MONTHLY CERTIFICATE
DISTRIBUTION FINANCIAL SERVICES RV TRUST 1999-1
Determination Date:
Monthly Payment Date:
Collection Period Ending:
I. Collection Account Summary
Total Available Funds:
Principal and Interest Payments Received (including Prepayments):
Net Liquidation Proceeds (including Rebates/Insurance Amounts):
Current Monthly Interest Advance:
Amount of Withdrawal, if any, from Reserve Account:
Purchase Amounts for Purchased Receivables:
Total Distribution Amount Sent to Trustee:
II. Excess or Shortfalls
Amount of Interest Payments Due During the Collection Period for
Receivables:
Amount of Interest Payments Received During the Collection Period for
Receivables:
Amount of Current Month Excess/Shortfall:
III. Calculation of Reserve Account Deposit/Withdrawals
Specified Reserve Account Balance
Deposits to Reserve Account (only if Reserve Account less than the Specified
Reserve Account Balance):
Withdrawals from Reserve Account (to the extent there are shortfalls on
payments of Interest or Principal):
Amount in Reserve Account as of Determination Date (excluding amount to be
paid on next Monthly Payment Date):
B-1
<PAGE>
IV. Collections on Receivables
(a) Interest and Principal Payments Received:
Interest Payments Received:
Scheduled Principal Payments Received:
Principal Prepayments Received:
Total Interest and Principal Payments Received:
(b) Liquidation Proceeds:
Gross Proceeds of Defaulted Receivables (including
Rebates/Insurance):
minus: Reasonable Expenses:
Net Liquidation Proceeds:
Allocation of Liquidation Proceeds:
Amount Allocable to Interest Payments:
Amount Allocable to Principal Payments:
(c) Purchase Amount--Receivables purchased from Trust:(1)
Amount Allocable to Interest:
Amount Allocable to Principal:
Total Collected Funds:
V. Calculation of Servicing and Trustee Fees:
Pool Balance of Receivables as of First Day of Collection Period:
multiplied by Servicing Fee Rate:
divided by Months per Year:
Servicing Fee Amount:
Pool Balance of Receivables as of First Day of Collection Period:
multiplied by Trustee Fee Rate:
divided by Months per Year:
Trustee Fee Amount:
- --------
(1) Identify pursuant to Section 4.09 of the Transfer and Servicing Agreement.
B-2
<PAGE>
VI. Pool Balance and Portfolio Performance
(a) Pool Balance:
Initial Pool Balance:
Pool Balance as of Preceding Accounting Date:
Pool Balance as of Current Accounting Date
Age of Pool in Months:
(b) Default and Delinquency Performance (Includes Repossessions
and Bankruptcies):
<TABLE>
<CAPTION>
Current Month Number of Loans Principal Balance Percentage
<S> <C>
30 - 59 Days Delinquent
60 - 89 Days Delinquent
90+ Days Delinquent
Defaults
Cumulative Defaults
</TABLE>
Schedule of Liquidated Receivables
Description of Vehicle
Account Number
Original Principal Balance of the Liquidated Receivables
Outstanding Principal Balance of the Liquidated Receivables
Gross Recovery
Net of Expenses
Realized Loss
Chargeoff Date
Repossession Date
Liquidation Date
Current Period Defaulted Receivables:
Description of Vehicle
Account Number
Original Principal Balance of the Defaulted Receivables
Outstanding Principal Balance of the Defaulted Receivables
Recovery Net of Expenses
Realized Loss
Chargeoff Date
Schedule of Repossession Inventory
B-3
<PAGE>
Description of Vehicle
Account Number
Original Principal Balance of the Defaulted Receivables
Outstanding Principal Balance of the Defaulted Loan
Recovery Net of Expenses
Realized Loss
Chargeoff Date
Repossession Date
Current Period Realized Losses
Current Month's Realized Losses as Percentage of Initial Pool Balance
(Annualized):
Preceding Month's Realized Losses as Percentage of Initial Pool Balance
(Annualized):
Second Preceding Month's Realized Losses as Percentage of Initial Pool Balance
(Annualized):
VII. Distributions of the Total Distributable Amount
Total Pool Factor:
Note Pool Factor:
A. Monthly Servicing Fee and any unpaid servicing fees from prior Monthly
Payment Dates: Servicer Reimbursements for Mistaken Deposits or
Postings of Checks Returned for Insufficient Funds (not Otherwise
Reimbursed to Servicer):
B. Noteholders' Interest Distributable Amount:
Class A-1
Class A-2
Class A-3
Class A-4
Class A-5
Class A-6
Class B
Class C
Noteholders' Monthly Principal Distributable Amount:
Class A-1
Class A-2
Class A-3
Class A-4
Class A-5
Class A-6
Class B
Class C
B-4
<PAGE>
EXHIBIT C
FINAL CERTIFICATION OF CUSTODIAN
(date)
(to be addressed to the
Indenture Trustee)
Re: Transfer and Servicing Agreement dated as of March 1, 1999,
among Distribution Financial Services RV Trust 1999-1,
Deutsche Recreational Asset Funding Corporation, and Deutsche
Financial Services Corporation, as Servicer (the "Agreement")
Gentlemen:
In accordance with the provisions of Section 3.02 of the
above-referenced Agreement, the undersigned, as custodian, hereby certifies that
as to each Receivable listed in the Schedule of Receivables, it has reviewed the
related Receivable File and has determined that (i) all documents required to be
delivered to it pursuant to the Agreement are in its possession, (ii) such
documents have been reviewed by it and appear regular on their face and relate
to such Receivable (for each of the Receivables listed on the attachment hereto
a certified confirmation of the lien is included in the Receivables File in lieu
of a fully executed original Lien Certificate or application therefor), and
(iii) based on its examination and only as to the foregoing documents, the
information set forth in the Schedule of Receivables respecting such Receivable
is correct. Capitalized terms used but not defined herein shall have the
meanings provided by the Agreement.
DEUTSCHE FINANCIAL SERVICES
CORPORATION
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
C-1
<PAGE>
Exhibit 10.3
GANIS/DEPOSITOR TRANSFER AGREEMENT
between
GANIS CREDIT CORPORATION,
as Transferor,
and
DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION,
as Depositor
Dated as of March 1, 1999
<PAGE>
TABLE OF CONTENTS
ARTICLE I
Definitions
SECTION 1.01. Definitions...................................................1
SECTION 1.02. Other Definitional Provisions.................................1
ARTICLE II
Contribution of Receivables
SECTION 2.01. Contribution..................................................2
SECTION 2.02. Intent of the Parties.........................................3
ARTICLE III
The Receivables
SECTION 3.01. Representations and Warranties as to Receivables..............4
ARTICLE IV
The Transferor
SECTION 4.01. Representations of Transferor................................10
SECTION 4.02. Corporate Existence..........................................12
SECTION 4.03. Liability of the Transferor..................................12
SECTION 4.04. Indemnification..............................................12
SECTION 4.05. Merger or Consolidation of, or Assumption of the Obligations
of, Transferor..................................12
SECTION 4.06. Limitation on Liability of Transferor and Others.............13
ARTICLE V
Miscellaneous
SECTION 5.01. Amendment....................................................13
SECTION 5.02. Protection of Title; Change of Name, Identity, Corporate
Structure or Location, Etc......................14
SECTION 5.03. Notices......................................................14
SECTION 5.04. Assignment...................................................15
SECTION 5.05. Limitations on Rights of Others..............................15
SECTION 5.06. Severability.................................................15
SECTION 5.07. Separate Counterparts........................................15
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SECTION 5.08. Headings.....................................................16
SECTION 5.09. Governing Law................................................16
SECTION 5.10. Nonpetition Covenants........................................16
SECTION 5.11. Waiver.......................................................16
SECTION 5.12. Separate Corporate Existence.................................16
SECTION 5.13. Submission to Jurisdiction...................................17
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GANIS/DEPOSITOR TRANSFER AGREEMENT dated as of March 1, 1999 (this
"Agreement") between DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION, a Nevada
corporation (the "Depositor") and GANIS CREDIT CORPORATION, a Delaware
corporation ("Ganis" or the "Transferor").
WHEREAS, the Depositor desires to acquire Receivables from the
Transferor;
WHEREAS, the Transferor is willing to contribute such Receivables to
the Depositor; and
WHEREAS, the Transferor acquired certain of such Receivables from DFS
pursuant to the DFS/Ganis Transfer Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. Except as otherwise specified herein or as
the context may otherwise require, capitalized terms used herein (including in
the recitals hereto) have the respective meanings assigned thereto in Appendix A
to the Transfer and Servicing Agreement for all purposes of this Agreement.
"Transfer and Servicing Agreement" means the Transfer and Servicing Agreement,
dated the same date as this Agreement, among Distribution Financial Services RV
Trust 1999-1, the Depositor, and Deutsche Financial Services Corporation, as
Servicer, as the same may be amended, amended and restated or otherwise modified
from time to time.
SECTION 1.02. Other Definitional Provisions.
(a) All terms defined in Appendix A to the Transfer and
Servicing Agreement shall have the defined meanings when used in any certificate
or other document made or delivered pursuant hereto unless otherwise defined
therein.
(b) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto, accounting terms not defined in this
Agreement or in any such certificate or other document, and accounting terms
partly defined in this Agreement or in any such certificate or other document to
the extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles. To the extent that the definitions of
accounting terms in this Agreement or in any such certificate or other document
are inconsistent with the meanings of such terms under generally accepted
accounting principles,
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the definitions contained in this Agreement or in any such certificate or other
document shall control.
(c) The words "hereof", "herein", "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; Article and Section
references contained in this Agreement are references to Articles and Sections
in this Agreement unless otherwise specified; and the term "including" shall
mean "including without limitation".
(d) The definitions contained in this Agreement are applicable
to the singular as well as the plural forms of such terms and to the masculine
as well as to the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred
to herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
amended and restated or otherwise modified and includes (in the case of
agreements or instruments) references to all attachments thereto and instruments
incorporated therein; references to a Person are also to its permitted
successors and assigns.
(f) Each reference to the "close of business" on a particular
day shall mean 5:00 p.m. Pacific Time on such day.
ARTICLE II
Contribution of Receivables
SECTION 2.01. Contribution. The Transferor does hereby transfer,
assign, set over and otherwise convey to the Depositor, as a capital
contribution, without recourse (subject to the obligations of the Transferor set
forth herein), all right, title and interest of the Transferor in, to and under
(but none of the obligations of the Transferor under):
(a) all of the Receivables originated by the Transferor or
acquired by the Transferor from Dealers (all of such Receivables being referred
to collectively as the "Transferor Receivables" and individually as a
"Transferor Receivable") and all moneys received thereon on and after the Cutoff
Date;
(b) the security interests in the Financed Vehicles created
pursuant to the Transferor Receivables and any other interest of the Transferor
in the Financed Vehicles;
(c) any proceeds with respect to the Transferor Receivables
under any Insurance Policies and all claims under such Insurance Policies;
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(d) any proceeds from recourse to Dealers with respect to
Transferor Receivables;
(e) any Financed Vehicle, relating to a Transferor Receivable,
acquired in repossession;
(f) the contents of the Receivable Files with respect to
Transferor Receivables and all rights, benefits and proceeds arising therefrom
or in connection therewith;
(g) all funds on deposit from time to time in the Trust
Accounts, and all investments and proceeds thereof (including all income
thereon);
(h) the DFS/Ganis Transfer Agreement;
(i) the DFS Conveyed Property; and
(j) the proceeds of any and all of the foregoing.
The Receivables and other items covered by clauses (a)-(j) of this
Section 2.01 shall be referred to collectively as the "Transferor Conveyed
Property".
SECTION 2.02. Intent of the Parties. (a) The Transferor and the
Depositor intend that the conveyance by the Transferor to the Depositor of the
right, title and interest of the Transferor in, to and under the Receivables and
the other Transferor Conveyed Property pursuant to this Agreement shall
constitute a capital contribution and not a loan, that such conveyance is
absolute and unconditional, and that the Transferor retain no interest in, to or
under the Receivables and the other Transferor Conveyed Property. However, in
the event that, notwithstanding the intent of the parties, such conveyance is
deemed to be a transfer for security and not a capital contribution, then (i)
the Transferor shall be deemed to have granted, and in such event does hereby
grant, to the Depositor a first priority security interest in all of its right,
title and interest in, to and under the Transferor Conveyed Property, and (ii)
this Agreement shall constitute a security agreement under applicable law with
respect to such conveyance.
(b) No party hereto shall take any action that is inconsistent with the
ownership of the Transferor Conveyed Property by the Depositor, it being
understood that this sentence shall not prevent the transfer of the Transferor
Conveyed Property by the Depositor to the Issuer in accordance with the Transfer
and Servicing Agreement. Each party hereto shall inform any Person inquiring
about the Receivables that the Transferor Conveyed Property has been transferred
by the Transferor to the Depositor and by the Depositor to the Issuer (and such
transfers shall be reflected in the accounting records and computer systems of
the parties hereto). Without limiting the generality of the foregoing, for
accounting, tax and other purposes each party hereto shall treat the transfer of
the Transferor Conveyed Property by the Transferor to the Depositor as a capital
contribution by the Transferor to the Depositor. Notwithstanding any
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other provision of this Agreement, no Person shall have any recourse to DFS, the
Transferor, the Depositor or the Servicer on account of the financial inability
of any Obligor to make payments in respect of a Receivable.
ARTICLE III
The Receivables
SECTION 3.01. Representations and Warranties as to Receivables. DFS has
made representations and warranties set forth in Section 3.01 of the DFS/Ganis
Transfer Agreement, and has consented to the assignment by the Transferor to the
Depositor and by the Depositor to the Issuer of the Transferor's rights with
respect thereto. Pursuant to Section 2.01 of this Agreement, the Transferor has
transferred to the Depositor all of the Transferor's right, title and interest
in, to and under the DFS/Ganis Transfer Agreement, which shall be understood to
include the representations and warranties of DFS therein, upon which the
Depositor relies in accepting the Receivables, together with all rights of the
Transferor with respect to any breach thereof, including the right to require
DFS to purchase Receivables in accordance with the DFS/Ganis Transfer Agreement.
The Transferor makes the following representations and warranties as to
the Receivables, on which representations and warranties each of the Depositor
and the Issuer is deemed to have relied in acquiring the Receivables. Such
representations and warranties speak as of the execution and delivery of this
Agreement and as of the Closing Date and shall survive the transfer and
assignment of the Receivables to the Issuer and the pledge thereof to the
Indenture Trustee pursuant to the Indenture.
(i) Characteristics of Receivables. All of the
Receivables (other than the DFS Receivables) were originated by the Transferor
or acquired by the Transferor from Dealers. Each Transferor Receivable (A) was
fully and properly executed by the parties thereto, (B) contains customary and
enforceable provisions such as to render the rights and remedies of the holder
thereof adequate for realization against the collateral security, (C) is fully
amortizing and provides for fixed level periodic payments which, if made when
due, shall fully amortize the Amount Financed over the original term (except
that if such Transferor Receivable is a Step Rate Receivable, such periodic
payments will vary from time to time during the term of such Receivable) and (D)
provides for, in the event that such Transferor Receivable is prepaid in full,
payment of an amount that fully pays the Principal Balance and includes accrued
but unpaid interest at least through the date of prepayment calculated at a rate
at least equal to its Annual Percentage Rate. Each Transferor Receivable
provides that payments thereon are to be applied in accordance with the Simple
Interest Method. If such Transferor Receivable was originated by a Dealer, such
Receivable, to the knowledge of the Transferor, (A) was originated by the Dealer
for the retail sale of a Financed Vehicle in the ordinary course of such
Dealer's business, (B) was purchased by the Transferor from such Dealer for new
value under a Dealer Agreement and (C) was validly assigned by the Dealer to the
Transferor. To the knowledge of the Transferor,
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such Dealer had all necessary licenses and permits to originate Transferor
Receivables in the state where such Dealer was located. If such Transferor
Receivable was originated by the Transferor, such Transferor Receivable was
originated for value by the Transferor in the ordinary course of its business to
finance the purchase of, or refinance, the related Financed Vehicle by the
related Obligor. The Transferor had all necessary licenses and permits to
originate or purchase such Transferor Receivable at the time of such origination
and purchase. The Transferor Receivables were selected at random by the
Transferor from its portfolio of recreational vehicle receivables originated by
the Transferor or acquired by the Transferor from Dealers.
(ii) No Fraud or Misrepresentation. To the
knowledge of the Transferor, each Transferor Receivable originated by a Dealer
was originated by the Dealer and sold by the Dealer to the Transferor without
any fraud or misrepresentation on the part of such Dealer.
(iii) Compliance with Law. To the knowledge of the
Transferor, all requirements of applicable federal, state and local laws, and
regulations thereunder (including, without limitation, usury laws, the Federal
Truth-in- Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing
Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the
Federal Trade Commission Act, the Magnuson-Moss Warranty Act, the Federal
Reserve Board's Regulations "B" and "Z", the Soldiers' and Sailors' Civil Relief
Act of 1940, state motor vehicle retail installment sales acts and lending acts
and state adaptations of the National Consumer Act and of the Uniform Consumer
Credit Code and other consumer credit laws and equal credit opportunity and
disclosure laws) in respect of all of the Transferor Receivables and each and
every sale of Financed Vehicles relating thereto, have been complied with in all
material respects, and each Transferor Receivable and the sale of the Financed
Vehicle evidenced by each Transferor Receivable complied at the time it was
originated or made and now complies in all material respects with all applicable
legal requirements, including the laws and regulations contemplated by this
clause (iii).
(iv) Origination. Each Transferor Receivable was
originated in the United States of America.
(v) Binding Obligation. Each Transferor Receivable
represents the genuine, legal, valid and binding payment obligation of the
Obligor thereon, enforceable by the holder thereof in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency,
reorganization or 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; and all parties to each Transferor Receivable had full legal
capacity to execute and deliver such Transferor Receivable and all other
documents related thereto and to grant the security interest purported to be
granted thereby.
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(vi) No Government Obligor. No Obligor of a
Transferor Receivable is the United States of America or any State or any
agency, department, subdivision or instrumentality thereof.
(vii) Obligor Bankruptcy. At the Cutoff Date, no
Obligor had been identified on the records of the Transferor as being the
subject of a current bankruptcy proceeding.
(viii) Schedule of Receivables. The information with
respect to Transferor Receivables set forth in the Schedule of Receivables is
true and correct in all material respects as of the close of business on the
Cutoff Date.
(ix) Marking Records. By the Closing Date, the
Transferor shall have caused the portions of its electronic ledger relating to
the Receivables to be clearly and unambiguously marked to show that the
Receivables have been transferred absolutely from DFS to the Transferor (in the
case of the DFS Receivables), from the Transferor to the Depositor and from the
Depositor to the Trust.
(x) Computer Tape. The Computer Tape was complete
and accurate as of the Cutoff Date and includes a description of the same
Receivables that are described in the Schedule of Receivables.
(xi) Chattel Paper. The Transferor Receivables
constitute chattel paper within the meaning of the UCC as in effect in the
states in which the Obligors reside.
(xii) One Original. There is only one original
executed copy of each Transferor Receivable.
(xiii) Receivable Files Complete. There exists a
Receivable File pertaining to each Transferor Receivable and, to the knowledge
of the Transferor, such Receivable File contains (a) a fully executed original
of the Transferor Receivable, with a fully executed assignment thereof in blank
or from the related Dealer to the Transferor, as the case may be, if such
Transferor Receivable was acquired by the Transferor from a Dealer, (b) a
certificate of physical damage insurance, application form for such insurance
signed by the Obligor or a signed representation letter from the Obligor named
in the Transferor Receivable pursuant to which the Obligor has agreed to obtain
physical damage insurance for the Financed Vehicle, or copies thereof, (c) the
Lien Certificate or a copy of the application therefor or a certification from
the Servicer that it has received confirmation from an authorized official of
the appropriate governmental office of the existence of the first lien of the
Transferor with respect to the related Financed Vehicle and (d) a credit
application signed by the Obligor, or a copy thereof. Each of such documents
which is required to be signed by the Obligor has been signed by the Obligor in
the appropriate spaces. Each of the foregoing documents has been
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correctly prepared. The complete file for each Transferor Receivable currently
is in the possession of the Servicer.
(xiv) Receivables in Force. No Transferor Receivable
has been satisfied, subordinated or rescinded, and the Financed Vehicle securing
each such Transferor Receivable has not been released from the lien of the
related Transferor Receivable in whole or in part. No provisions of any
Transferor Receivable have been waived, altered or modified (except that DFS as
servicer may have, for administrative purposes, modified the due date of a
Transferor Receivable to a different date in the month, which modification is
reflected in its servicing records) in any respect since its origination, except
by instruments or documents identified in the Receivable File. No Transferor
Receivable has been modified as a result of application of the Soldiers' and
Sailors' Civil Relief Act of 1940, as amended.
(xv) Lawful Assignment. No Transferor Receivable
was originated in, or is subject to the laws of, any jurisdiction the laws of
which (a) would make unlawful, void or voidable the transfer and assignment of
such Transferor Receivable under this Agreement or the pledge of such Transferor
Receivable under the Indenture or (b) would impair the validity or
enforceability of any Transferor Receivable because of any such transfer,
assignment or pledge.
(xvi) Good Title. No Transferor Receivable has been
sold, transferred, assigned or pledged by the Transferor except pursuant to this
Agreement; immediately prior to the conveyance of the Receivables by the
Transferor to the Depositor pursuant to this Agreement, the Transferor had good
and indefeasible title to the Receivables, free and clear of any Lien. No Dealer
has a participation in, or other right to receive, payments or proceeds in
respect of any Transferor Receivable. The Transferor has not taken any action to
convey any right to any Person that would result in such Person having a right
to payments received under the related Insurance Policies or the related Dealer
Agreements or to payments due under such Transferor Receivables. This Agreement
is effective to transfer to the Depositor all of the right, title and interest
of the Transferor in, to and under the Receivables.
(xvii) Security Interest in Financed Vehicle. Each
Transferor Receivable has created a valid, binding and enforceable first
priority security interest in favor of the Transferor in the related Financed
Vehicle, which is in full force and effect. Each Lien Certificate contained in
the Receivables Files shows the Transferor named as the original secured party
under each Transferor Receivable and as the holder of a first priority security
interest in such Financed Vehicle. With respect to each Transferor Receivable
for which the Lien Certificate is not contained in the related Receivable File,
the Servicer has either received written evidence that such Lien Certificate
showing the Transferor as first lienholder has been applied for or has certified
in writing in the related Receivable File that it has received confirmation from
the appropriate governmental office of the existence of the first lien of the
Transferor with respect to the related Financed Vehicle. The security interest
of the Transferor in each such Financed Vehicle has been validly assigned by the
Transferor to the Depositor pursuant to this Agreement.
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Each Transferor Receivable is secured by an enforceable and perfected first
priority security interest in the Financed Vehicle in the name of the Transferor
as secured party, which security interest is prior to all other Liens upon and
security interests in such Financed Vehicle.
(xviii) All Filings Made; Valid Security Interest.
All filings (including, without limitation, UCC filings) required to be made by
any Person and actions required to be taken or performed by any Person in any
jurisdiction to give the Depositor a first priority perfected ownership interest
in the Receivables and the proceeds thereof have been made, taken or performed,
subject to the transfer thereof by the Depositor to the Issuer. At the Closing
Date the Depositor shall have a valid, subsisting and enforceable first priority
ownership interest in each Receivable and the proceeds thereof, subject to the
transfer thereof by the Depositor to the Issuer.
(xix) No Impairment. The Transferor has not done
and shall not do anything to convey any right to any Person that would result in
such Person having a right to payments due under a Receivable or otherwise to
impair the rights of the Trust in any Receivable or the proceeds thereof.
(xx) No Release. No Transferor Receivable is
assumable by another Person in a manner which would release the Obligor thereof
from such Obligor's obligations to the Transferor with respect to such
Transferor Receivable.
(xxi) No Defenses. No Transferor Receivable is
subject to any right of rescission, setoff, counterclaim or defense and, to the
knowledge of the Transferor, no such right has been asserted or threatened with
respect to any Transferor Receivable. The operation of the terms of any
Transferor Receivable or the exercise of any right thereunder shall not render
the Transferor Receivable unenforceable in whole or in part or subject to any
right of rescission, setoff, counterclaim or defense, and to the knowledge of
the Transferor, no such right of rescission, setoff, counterclaim or defense has
been asserted or threatened with respect thereto.
(xxii) No Default. To the knowledge of the
Transferor, there has been no default, breach, violation or event permitting
acceleration under the terms of any Transferor Receivable (other than payment
delinquencies as of the Cutoff Date of not more than 59 days), and no condition
exists or event has occurred and is continuing that with notice, the lapse of
time or both would constitute a default, breach, violation or event permitting
acceleration under the terms of any Transferor Receivable, and there has been no
waiver of any of the foregoing. As of the Cutoff Date, no Financed Vehicle
relating to any Transferor Receivable had been repossessed.
(xxiii) Insurance. Each Transferor Receivable
requires the Obligor to maintain physical loss and damage insurance, naming the
Transferor and its successors and assigns as additional insured parties or loss
payees, and each Transferor Receivable permits the holder thereof to obtain
physical loss and damage insurance at the expense of the Obligor if the
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Obligor fails to do so. No Financed Vehicle relating to any Transferor
Receivable was insured under a policy of force-placed insurance on the Cutoff
Date.
(xxiv) Past Due. At the Cutoff Date, no Transferor
Receivable was more than 59 days past due.
(xxv) No Liens. There are no Liens or claims which
have been filed, and, to the knowledge of the Transferor, none pending or
threatened to be filed, for work, labor, materials or unpaid state or federal
taxes affecting the Financed Vehicle securing any Transferor Receivable which
are or may become liens prior or equal to the lien of the Transferor Receivable.
(xxvi) Remaining Principal Balance. At the Cutoff
Date, the Principal Balance of each Transferor Receivable set forth in the
Schedule of Receivables is true and accurate in all material respects.
(xxvii) Final Scheduled Maturity Date. No
Receivable has a final maturity which is sooner than the first Monthly Payment
Date following the Closing Date or later than 240 months after the Cutoff Date.
(xxviii) Certain Characteristics. (A) Each
Receivable had a remaining maturity, as of the Cutoff Date, of at least 2 months
but not more than 240 months; (B) each Receivable had an original maturity of at
least 12 months but not more than 240 months; (C) each Receivable had an
original principal balance of at least $$1,313.31 and not more than $889,770.23;
(D) each Receivable had a Principal Balance as of the Cutoff Date of at least
$153.62 and not more than $873,403.15; (E) as of the Cutoff Date, each
Receivable has an Annual Percentage Rate of at least 4.00% and not more than
18.50%; (F) approximately 50.52% of the aggregate Principal Balance of the
Receivables (measured as of the Cutoff Date), constituting 56.18% of the number
of such Receivables, were secured by used Financed Vehicles at the time such
Receivables were originated; (G) no funds have been advanced by the Transferor,
any Dealer, or any Person acting on behalf of any of them in order to cause any
Transferor Receivable to qualify under paragraph (xxv) above; (H) as of the
Cutoff Date, other than California (19.74%), Florida (9.20%), Oregon (6.93%) and
Texas (11.06%), no State represented more than 5% of the Initial Pool Balance
with respect to the billing addresses of the Obligors (as determined by
reference to the records of DFS); and (I) the Principal Balance of each
Transferor Receivable set forth in Schedule of Receivables is true and accurate
in all material respects as of the Cutoff Date. As of the Cutoff Date, the sum
of the Principal Balances of the Receivables which are Step Rate Receivables
does not exceed 1% of the Initial Pool Balance.
For purposes of determining whether the Transferor is obligated to
purchase a Receivable on account of a breach of a representation and warranty
pursuant to this Section 3.01 or indemnify in respect of such breach pursuant to
the last paragraph of this Section 3.01, the
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determination as to whether a representation or warranty that is made to the
knowledge of the Transferor has been breached shall be made without regard to
such knowledge of the Transferor as if such representation and warranty were not
qualified by the knowledge of the Transferor.
Upon discovery by any party hereto of a breach of any of the
representations and warranties of the Transferor set forth in this Section or of
DFS set forth in Section 3.01 of the DFS/Ganis Transfer Agreement, in each case
which materially and adversely affects the value of the Receivables or the
interest therein of the Issuer or the Indenture Trustee (or which materially and
adversely affects the interest of the Issuer or the Indenture Trustee in the
related Receivable in the case of a representation and warranty relating to a
particular Receivable), the party discovering such breach shall give prompt
written notice to the other parties hereto. On the last day of the Collection
Period following the Collection Period during which the Transferor discovers or
receives notice of any such breach of any such representation or warranty, if
such breach shall not have been cured in all material respects by such last day,
the Transferor shall purchase (and, if applicable, the Transferor shall enforce
the obligation of DFS, under the DFS/Ganis Transfer Agreement, to purchase) such
Receivable from the Issuer (or from the Depositor, if the Depositor is required
to purchase such Receivable pursuant to Section 3.01 of the Transfer and
Servicing Agreement) as of such last day at a price equal to the Purchase Amount
of such Receivable, which price the Transferor shall remit in the manner
specified in Section 5.05 of the Transfer and Servicing Agreement; provided,
that, with respect to the representation set forth in paragraph (xiii) above,
such purchase shall be required with respect to a Receivable only if any
resulting breach is not cured (it being understood that if the related Lien
Certificate has been duly applied for from the applicable governmental offices
as evidenced by a copy of the application therefor, the receipt of such Lien
Certificate shall not be required to cure a breach of the applicable
representation and warranty) within 90 days after completion of the review and
examination of the Receivable File for such Receivable pursuant to Section 3.02
of the Transfer and Servicing Agreement. Subject to the indemnification
provisions contained in the last paragraph of this Section, the sole remedy of
the Depositor, the Issuer, the Owner Trustee, the Indenture Trustee, the
Residual Interestholder and the Noteholders with respect to a breach of
representations and warranties of the Transferor set forth in this Section shall
be to require the Transferor to purchase Receivables pursuant to this Section,
subject to the conditions contained herein; it being understood that this
sentence shall not limit the right of the parties to the Transfer and Servicing
Agreement to enforce (or to cause the Transferor to enforce) the obligation of
DFS to purchase Receivables pursuant to the DFS/Ganis Transfer Agreement.
The Transferor shall indemnify the Depositor, the Issuer, the Owner
Trustee and the Indenture Trustee and hold each harmless against any loss,
damages, penalties, fines, forfeitures, legal fees and related costs, judgments,
and other costs and expenses resulting from any claim, demand, defense or
assertion based on or grounded upon, or resulting from, a breach of the
representations and warranties of the Transferor contained in this Agreement;
provided that the Transferor shall not be liable for any indirect damages or for
any loss, damage, penalty, fine, forfeiture, legal fees and related costs,
judgments and other costs and expenses caused by the wilful misconduct of the
Depositor, the Issuer, the Owner Trustee or the Indenture Trustee.
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ARTICLE IV
The Transferor
SECTION 4.01. Representations of Transferor. The Transferor makes the
following representations on which each of the Depositor and the Issuer is
deemed to have relied in acquiring the Receivables. The representations speak as
of the execution and delivery of this Agreement and as of the Closing Date, in
the case of the Receivables, and shall survive the transfer of the Receivables
to the Issuer and the pledge thereof to the Indenture Trustee pursuant to the
Indenture.
(a) Organization and Good Standing. The Transferor is duly
organized and validly existing as a corporation in good standing under the laws
of the State of Delaware, with the corporate power and authority to own its
properties and to conduct its business as such properties are currently owned
and such business is presently conducted, and had at all relevant times, and
has, the corporate power, authority and legal right to acquire and own the
Receivables.
(b) Due Qualification. The Transferor 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 property or the conduct of its business shall require such
qualifications.
(c) Power and Authority. The Transferor has the corporate
power and authority to execute and deliver this Agreement and to carry out its
respective terms; the Transferor has full power and authority to transfer and
assign the property to be transferred and assigned to the Depositor, and the
Transferor shall have duly authorized such transfer and assignment by all
necessary corporate action; and the execution, delivery and performance of this
Agreement by the Transferor has been duly authorized by the Transferor by all
necessary corporate action.
(d) Binding Obligation. This Agreement constitutes a legal,
valid and binding obligation of the Transferor enforceable in accordance with
its terms.
(e) No Violation. The consummation of the transactions
contemplated by this Agreement by the Transferor and the fulfillment of the
terms hereof by the Transferor do not conflict with, result in any breach of any
of the terms and provisions of, or constitute (with or without notice or lapse
of time) a default under, the articles of incorporation or bylaws of the
Transferor, or any indenture, agreement or other instrument to which the
Transferor 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 or other instrument (other than pursuant to the Basic
Documents); or violate any law or, to the best of the Transferor's knowledge,
any order, rule or regulation applicable to the Transferor of any court or of
any
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federal or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Transferor or its properties.
(f) No Proceedings. To the Transferor's best knowledge, there
are no proceedings or investigations pending or threatened before any court,
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Transferor or its properties: (i) asserting the
invalidity of this Agreement, the Indenture or any of the other Basic Documents,
the Notes or the Certificates, (ii) seeking to prevent the issuance of the Notes
or the Certificates or the consummation of any of the transactions contemplated
by this Agreement, the Indenture or any of the other Basic Documents, (iii)
seeking any determination or ruling that might materially and adversely affect
the performance by the Transferor of its obligations under, or the validity or
enforceability of, this Agreement, the Indenture, any of the other Basic
Documents, the Notes or the Certificates or (iv) which might adversely affect
the federal or state income tax attributes of the Notes or the Certificates.
(g) Chief Executive Office. The chief executive office of the
Transferor is located at 660 Newport Center Drive, Newport Beach, California
92660.
SECTION 4.02. Corporate Existence. During the term of this Agreement,
the Transferor shall keep in full force and effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation and shall 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 Agreement, the Basic Documents
and each other instrument or agreement necessary or appropriate to the proper
administration of this Agreement and the transactions contemplated hereby.
SECTION 4.03. Liability of the Transferor. The Transferor shall be
liable in accordance herewith only to the extent of the obligations specifically
undertaken by the Transferor under this Agreement.
SECTION 4.04. Indemnification. (a) The Transferor shall indemnify,
defend and hold harmless the Depositor against any taxes that may at any time be
asserted against the Depositor with respect to any sales, tangible personal
property, privilege or license taxes relating to this Agreement (but not
including any taxes asserted with respect to, and as of the date of, the
transfer of the Receivables to the Depositor or the issuance and original sale
of the Notes or the Residual Interest, or asserted with respect to ownership of
the Receivables, or federal or other income taxes) and costs and expenses in
defending against the same.
(b) The Transferor shall indemnify, defend and hold harmless the
Depositor and any of the officers, directors, employees and agents of the
Depositor from and against any loss, liability or expense incurred by reason of
the Transferor's willful misfeasance, bad faith or negligence in the performance
of its duties under this Agreement, or by reason of reckless disregard of its
obligations and duties under this Agreement.
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Indemnification under this Section shall survive termination of this
Agreement and the other Basic Documents and shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Transferor shall have
made any indemnity payments pursuant to this Section and the Person to or on
behalf of whom such payments are made thereafter shall collect any of such
amounts from others, such Person shall promptly repay such amounts to the
Transferor, without interest.
SECTION 4.05. Merger or Consolidation of, or Assumption of the
Obligations of, Transferor. Any Person (a) into which the Transferor may be
merged or consolidated, (b) which may result from any merger or consolidation to
which the Transferor shall be a party or (c) which may succeed to the properties
and assets of the Transferor substantially as a whole, which Person in any of
the foregoing cases executes an agreement of assumption to perform every
obligation of the Transferor under this Agreement, shall be the successor to the
Transferor hereunder without the execution or filing of any document or any
further act by any of the parties to this Agreement; provided, however, that (i)
immediately after giving effect to such transaction, no representation or
warranty made by the Transferor in Section 3.01 shall have been breached (unless
the applicable breach shall have been cured in all material respects, or the
applicable Receivable shall have been purchased in accordance herewith), (ii)
the Transferor shall have delivered to the Depositor, 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 and that all conditions precedent, if any,
provided for in this Agreement relating to such transaction have been complied
with, (iii) the Transferor shall have delivered to the Owner Trustee and the
Indenture Trustee an Opinion of Counsel either (A) stating that, in the opinion
of such counsel, all financing statements and continuation statements and
amendments thereto have been executed and filed that are necessary fully to
preserve and protect the interest of the Owner Trustee and Indenture Trustee,
respectively, in the Receivables and reciting the details of such filings, or
(B) stating that, in the opinion of such counsel, no such action shall be
necessary to preserve and protect such interests. Notwithstanding anything
herein to the contrary, the execution of the foregoing agreement of assumption
and compliance with clauses (i), (ii), and (iii) above shall be conditions to
the consummation of the transactions referred to in clauses (a), (b) or (c)
above.
SECTION 4.06. Limitation on Liability of Transferor and Others. The
Transferor and any director, officer, employee or agent of the Transferor 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 hereunder. The Transferor shall not be under any obligation to appear
in, prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement, and that in its opinion may involve it in any
expense or liability.
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ARTICLE V
Miscellaneous
SECTION 5.01. Amendment. This Agreement may be amended by the parties
hereto, with the consent of the Indenture Trustee, but without the consent of
any other Person; provided, however, that no such amendment shall be effective
unless either (a) the Owner Trustee and the Indenture Trustee shall have been
delivered an Opinion of Counsel to the effect that such amendment shall not
adversely affect in any material respect the interests of any Noteholder or the
Residual Interestholder, or (b) the Holders of 100% of the Outstanding Amount of
the Notes shall have consented to such amendment.
Promptly after the execution of any such amendment or consent, the
Depositor shall furnish written notification of the substance of such amendment
or consent to the Indenture Trustee and each of the Rating Agencies.
Prior to the execution of or the consent to any amendment to this
Agreement, the Indenture Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that the execution of or the consent to such
amendment is authorized or permitted by this Agreement. The Indenture Trustee
may, but shall not be obligated to, consent to any such amendment which affects
the Indenture Trustee's own rights, duties or immunities under this Agreement or
otherwise.
SECTION 5.02. Protection of Title; Change of Name, Identity, Corporate
Structure or Location, Etc.
(a) The Transferor shall execute and file such financing
statements and cause to be executed and filed such continuation statements, all
in such manner and in such places as may be required by law fully to preserve,
maintain and protect the interest of the Depositor, the Issuer and of the
Indenture Trustee in the Receivables and in the proceeds thereof. The Transferor
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) The Transferor shall not change its name, identity or
corporate structure in any manner that would, could or might make any financing
statement or continuation statement filed 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 Depositor, the Owner Trustee and the Indenture Trustee
at least five days' prior written notice thereof and shall have promptly filed
appropriate amendments to all previously filed financing statements or
continuation statements.
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(c) The Transferor shall give the Depositor, the Owner Trustee
and the Indenture Trustee at least 60 days' prior written notice of any
relocation of its chief 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 and shall promptly file any such amendment or new financing statement.
(d) If at any time the Transferor shall propose to sell, grant
a security interest in, or otherwise transfer any interest in recreational
vehicle receivables to any prospective purchaser, lender or other transferee,
the Transferor shall give (or shall cause the Servicer to give) to such
prospective purchaser, lender or other transferee computer tapes, records or
printouts (including any restored from backup archives) that, if they shall
refer in any manner whatsoever to any Receivable, shall indicate clearly that
such Receivable has been transferred by the Transferor to the Depositor and by
the Depositor to the Issuer and is owned by the Issuer and has been pledged to
the Indenture Trustee.
SECTION 5.03. Notices. All demands, notices, directions, communications
and instructions upon, to, or by the Servicer, the Transferor, the Depositor,
the Issuer, the Owner Trustee, the Indenture Trustee or the Rating Agencies
under this Agreement shall be in writing, personally delivered or mailed by
certified mail, return receipt requested, and shall be deemed to have been duly
given upon receipt (a) in the case of the Servicer (so long as DFS is the
Servicer), to Deutsche Financial Services Corporation, 655 Maryville Centre
Drive, St. Louis, Missouri 63141, Attention: Senior Vice President/Treasurer or
Chief Legal Officer, (b) in the case of the Transferor, to Ganis Credit
Corporation, 660 Newport Center Drive, Newport Beach, California 92660,
Attention: Senior Vice President, (c) in the case of the Depositor, to Deutsche
Recreational Asset Funding Corporation, 655 Maryville Centre Drive, St. Louis,
Missouri 63141, Attention: President, (d) in the case of the Issuer or the Owner
Trustee, at the Corporate Trust Office (as defined in the Trust Agreement), (e)
in the case of the Indenture Trustee, at the Corporate Trust Office, (f) in the
case of Fitch, to Fitch IBCA, Inc., One State Street Plaza, New York, New York
10004, Attention: Asset-Backed Securities Surveillance Group, and (g) in the
case of Standard & Poor's, to Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc., 25 Broadway (15th Floor), New York, New York
10004, Attention of Asset Backed Surveillance Department; or, as to each of the
foregoing, at such other address as shall be designated by written notice to the
other Persons listed in this Section.
SECTION 5.04. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 4.05 of this Agreement, this
Agreement may not be assigned by the Transferor. The Transferor hereby
acknowledges and consents to (i) the transfer by the Depositor to the Issuer
pursuant to the Transfer and Servicing Agreement of all right, title and
interest of the Depositor in, to and under (but none of the obligations of the
Depositor under) the Transferor Conveyed Property and this Agreement, including
the representations and warranties of DFS in the DFS/Ganis Transfer Agreement
and of the Transferor in this Agreement, together with all rights of the
Depositor with respect to any breach thereof, including the right to require DFS
to purchase Receivables in accordance with the DFS/Ganis Transfer
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Agreement and to require the Transferor to purchase Receivables in accordance
with this Agreement, and (ii) the other terms of and transactions contemplated
by the Transfer and Servicing Agreement and the other Basic Documents.
SECTION 5.05. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of DFS, the Transferor, the Depositor, the
Servicer, the Issuer, the Owner Trustee, the Indenture Trustee and the
Noteholders, and, except as expressly provided in this Agreement, nothing in
this Agreement shall be construed to give to any other Person any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
covenants, conditions or provisions contained herein.
SECTION 5.06. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 5.07. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 5.08. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 5.09. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE PERFECTION (AND THE EFFECT OF
PERFECTION OR NON-PERFECTION) OF THE INTERESTS OF ANY PERSON IN CONVEYED
PROPERTY ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW
YORK.
SECTION 5.10. Nonpetition Covenants. Notwithstanding any prior
termination of this Agreement, the Transferor shall not acquiesce, petition or
otherwise invoke or cause the Issuer to invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Issuer 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 any substantial part of its property, or
ordering the winding up or liquidation of the affairs of the Issuer.
Notwithstanding any prior termination of this Agreement, the Transferor shall
not acquiesce, petition or otherwise invoke or cause the Depositor to invoke the
process of any court or government authority for the purpose of commencing or
sustaining a case against the Depositor under any federal or state bankruptcy,
insolvency or similar law, or
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appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or
other similar official of the Depositor or any substantial part of its property,
or ordering the winding up or liquidation of the affairs of the Depositor.
SECTION 5.11. Waiver. Each party hereto hereby (a) acknowledges that
Mayer, Brown & Platt represents (i) DFS, the Transferor, and the Depositor in
connection with the transactions contemplated by the Basic Documents, (ii)
Affiliates of the Transferor, DFS and the Depositor in other matters, (iii)
underwriters of the Notes (and Affiliates of such underwriters) in other
matters, (iv) the institutions which are the Indenture Trustee and the Owner
Trustee (and Affiliates of such institutions) in other matters, and (v) the
Specified Accountants in other matters, and (b) waives any conflict of interest
relating thereto. Notwithstanding any other provision of this Agreement, Mayer,
Brown & Platt is entitled to rely on this Section.
SECTION 5.12. Separate Corporate Existence. Each party hereto hereby
acknowledges that the Trust is entering into the transactions contemplated by
the Basic Documents in reliance upon the Depositor's identity as a legal entity
separate from DFS and the Transferor. Therefore, each of the Transferor and the
Depositor shall take all reasonable steps to make it apparent to third Persons
that the Depositor is an entity with assets and liabilities distinct from those
of DFS and the Transferor and that the Depositor is not a division of DFS, the
Transferor or any other Person. Without limiting the foregoing, each party
hereto shall operate and conduct its respective businesses and otherwise act in
a manner which is consistent with Section 10.13 of the Transfer and Servicing
Agreement.
SECTION 5.13. Submission to Jurisdiction. Each of the parties hereto
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any other Basic Document or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter have to the
venue of such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to such
Person at its address set forth in Section 5.03 or at such other address
notified to the other party to this Agreement pursuant thereto; and
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(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction.
[SIGNATURES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Ganis/Depositor
Transfer Agreement to be duly executed by their respective officers as of the
day and year first above written.
GANIS CREDIT CORPORATION, as Transferor
By: /s/ Richard C. Goldman
----------------------------------------
Name: Richard C. Goldman
--------------------------------------
Title: Vice President
-------------------------------------
By: /s/ Richard H. Schumacher
----------------------------------------
Name: Richard H. Schumacher
--------------------------------------
Title: Assistant Treasurer
-------------------------------------
DEUTSCHE RECREATIONAL ASSET FUNDING
CORPORATION, as Depositor
By: /s/ Richard C. Goldman
----------------------------------------
Name: Richard C. Goldman
--------------------------------------
Title: Vice President
-------------------------------------
By: /s/ Richard H. Schumacher
----------------------------------------
Name: Richard H. Schumacher
--------------------------------------
Title: Vice President
-------------------------------------
S-1
<PAGE>
Exhibit 10.4
DFS/GANIS TRANSFER AGREEMENT
between
DEUTSCHE FINANCIAL SERVICES CORPORATION
and
GANIS CREDIT CORPORATION
Dated as of March 1, 1999
<PAGE>
TABLE OF CONTENTS
ARTICLE I
Definitions
SECTION 1.01. Definitions.................................................1
SECTION 1.02. Other Definitional Provisions...............................1
ARTICLE II
Contribution of Receivables
SECTION 2.01. Contribution................................................2
SECTION 2.02. Intent of the Parties.......................................3
ARTICLE III
The Receivables
SECTION 3.01. Representations and Warranties as to Receivables............4
ARTICLE IV
DFS
SECTION 4.01. Representations of DFS.....................................10
SECTION 4.02. Corporate Existence........................................12
SECTION 4.03. Liability of DFS ..........................................12
SECTION 4.04. Indemnification............................................12
SECTION 4.05. Merger or Consolidation of, or Assumption of the
Obligations of, DFS.................................12
SECTION 4.06. Limitation on Liability of DFS and Others..................13
ARTICLE V
Miscellaneous
SECTION 5.01. Amendment..................................................13
SECTION 5.02. Protection of Title; Change of Name, Identity, Corporate
Structure or Location, Etc..........................13
SECTION 5.03. Notices....................................................14
SECTION 5.04. Assignment.................................................15
SECTION 5.05. Limitations on Rights of Others............................15
SECTION 5.06. Severability...............................................15
SECTION 5.07. Separate Counterparts......................................15
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SECTION 5.08. Headings...................................................15
SECTION 5.09. Governing Law..............................................15
SECTION 5.10. Nonpetition Covenants......................................16
SECTION 5.11. Waiver.....................................................16
SECTION 5.12. Separate Corporate Existence...............................16
SECTION 5.13. Submission to Jurisdiction.................................16
SECTION 5.13 Submission to Jurisdiction.................................16
ii
<PAGE>
DFS/GANIS TRANSFER AGREEMENT dated as of March 1, 1999 (this
"Agreement") between DEUTSCHE FINANCIAL SERVICES CORPORATION, a Nevada
corporation ("DFS") and GANIS CREDIT CORPORATION, a Delaware corporation
("Ganis").
WHEREAS, Ganis desires to acquire Receivables from DFS; and
WHEREAS, DFS is willing to contribute such Receivables to Ganis.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. Except as otherwise specified herein or as
the context may otherwise require, capitalized terms used herein (including in
the recitals hereto) have the respective meanings assigned thereto in Appendix A
to the Transfer and Servicing Agreement for all purposes of this Agreement.
"Transfer and Servicing Agreement" means the Transfer and Servicing Agreement,
dated the same date as this Agreement, among Distribution Financial Services RV
Trust 1999-1, Deutsche Recreational Asset Funding Corporation and DFS, as
Servicer, as the same may be amended, amended and restated or otherwise modified
from time to time.
SECTION 1.02. Other Definitional Provisions.
(a) All terms defined in Appendix A to the Transfer and Servicing
Agreement shall have the defined meanings when used in any certificate or other
document made or delivered pursuant hereto unless otherwise defined therein.
(b) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto, accounting terms not defined in this
Agreement or in any such certificate or other document, and accounting terms
partly defined in this Agreement or in any such certificate or other document to
the extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles. To the extent that the definitions of
accounting terms in this Agreement or in any such certificate or other document
are inconsistent with the meanings of such terms under generally accepted
accounting principles, the definitions contained in this Agreement or in any
such certificate or other document shall control.
(c) The words "hereof", "herein", "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular
<PAGE>
provision of this Agreement; Article and Section references contained in this
Agreement are references to Articles and Sections in this Agreement unless
otherwise specified; and the term "including" shall mean "including without
limitation".
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred to herein
or in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, amended and
restated or otherwise modified and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments incorporated
therein; references to a Person are also to its permitted successors and
assigns.
(f) Each reference to the "close of business" on a particular day shall
mean 5:00 p.m. Pacific Time on such day.
ARTICLE II
Contribution of Receivables
SECTION 2.01. Contribution. DFS does hereby transfer, assign, set over
and otherwise convey to Ganis, as a capital contribution, without recourse
(subject to the obligations of DFS set forth herein), all right, title and
interest of DFS in, to and under (but none of the obligations of DFS under):
(a) all of the Receivables originated by DFS or acquired by DFS from
Dealers (all of such Receivables being referred to collectively as the "DFS
Receivables" and individually as a "DFS Receivable") and all moneys received
thereon on and after the Cutoff Date;
(b) the security interests in the Financed Vehicles created pursuant to
the DFS Receivables and any other interest of DFS in the Financed Vehicles;
(c) any proceeds with respect to the DFS Receivables under any
Insurance Policies and all claims under such Insurance Policies;
(d) any proceeds from recourse to Dealers with respect to DFS
Receivables;
(e) any Financed Vehicle, relating to a DFS Receivable, acquired in
repossession;
(f) the contents of the Receivable Files with respect to DFS
Receivables and all rights, benefits and proceeds arising therefrom or in
connection therewith;
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(g) all funds on deposit from time to time in the Trust Accounts, and
all investments and proceeds thereof (including all income thereon); and
(h) the proceeds of any and all of the foregoing.
The DFS Receivables and other items covered by clauses (a)-(h) of this
Section 2.01 shall be referred to collectively as the "DFS Conveyed Property".
The conveyance of the DFS Conveyed Property by DFS to Ganis (and the other terms
of this Agreement) shall not be deemed to limit the right of DFS (i) to act as
Servicer or (ii) in its capacity as Servicer, to receive compensation as set
forth in the Basic Documents.
SECTION 2.02. Intent of the Parties. (a) DFS and Ganis intend that the
conveyance by DFS to Ganis of the right, title and interest of DFS in, to and
under the DFS Receivables and the other DFS Conveyed Property pursuant to this
Agreement shall constitute a capital contribution and not a loan, that such
conveyance is absolute and unconditional, and that DFS retain no interest in, to
or under the DFS Receivables and the other DFS Conveyed Property. However, in
the event that, notwithstanding the intent of the parties, such conveyance is
deemed to be a transfer for security and not a capital contribution, then (i)
DFS shall be deemed to have granted, and in such event does hereby grant, to
Ganis a first priority security interest in all of its right, title and interest
in, to and under DFS Conveyed Property, and (ii) this Agreement shall constitute
a security agreement under applicable law with respect to such conveyance.
(b) No party hereto shall take any action that is inconsistent with the
ownership of the DFS Conveyed Property by Ganis, it being understood that this
sentence shall not prevent the transfer of the DFS Conveyed Property by Ganis to
the Depositor in accordance with the Ganis/Depositor Transfer Agreement and the
transfer of the DFS Conveyed Property by the Depositor to the Issuer in
accordance with the Transfer and Servicing Agreement. Each party hereto shall
inform any Person inquiring about the Receivables that the DFS Conveyed Property
has been transferred by DFS to Ganis, by Ganis to the Depositor and by the
Depositor to the Issuer (and such transfers shall be reflected in the accounting
records and computer systems of the parties hereto). Without limiting the
generality of the foregoing, for accounting, tax and other purposes each party
hereto shall treat the transfer of the DFS Conveyed Property by DFS to Ganis as
a capital contribution by DFS to Ganis. Notwithstanding any other provision of
this Agreement, no Person shall have any recourse to DFS, Ganis or the Servicer
on account of the financial inability of any Obligor to make payments in respect
of a Receivable.
(c) DFS and Ganis intend that, solely for purposes of allocating income
between DFS and Ganis, (i) the conveyance of DFS Receivables by DFS to Ganis
shall be effective as of the respective dates on which DFS originated or
acquired such DFS Receivables, (ii) all proceeds and income arising on or prior
to the Closing Date in respect of such DFS Receivables shall be deemed to have
been transferred by DFS to Ganis as of such respective dates of origination and
execution, and (iii) Ganis shall be deemed to have paid such proceeds and income
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simultaneously to DFS as a repayment of intercompany debt owed by Ganis to DFS.
The preceding sentence shall not limit or otherwise affect the other provisions
of this Agreement, including the provisions of Section 3.01 relating to the
obligation of DFS to purchase Receivables in the circumstances contemplated
thereby.
ARTICLE III
The Receivables
SECTION 3.01. Representations and Warranties as to Receivables.
DFS makes the following representations and warranties as to the
Receivables, on which representations and warranties each of Ganis, the
Depositor and the Issuer is deemed to have relied in acquiring the Receivables.
Such representations and warranties speak as of the execution and delivery of
this Agreement and as of the Closing Date and shall survive the transfer and
assignment of the Receivables to the Issuer and the pledge thereof to the
Indenture Trustee pursuant to the Indenture.
(i) Characteristics of Receivables. All of the Receivables
(other than the Transferor Receivables) were originated by DFS or
acquired by DFS from Dealers. Each DFS Receivable (A) was fully and
properly executed by the parties thereto, (B) contains customary and
enforceable provisions such as to render the rights and remedies of the
holder thereof adequate for realization against the collateral
security, (C) is fully amortizing and provides for fixed level periodic
payments which, if made when due, shall fully amortize the Amount
Financed over the original term (except that if such DFS Receivable is
a Step Rate Receivable, such periodic payments will vary from time to
time during the term of such Receivable) and (D) provides for, in the
event that such DFS Receivable is prepaid in full, payment of an amount
that fully pays the Principal Balance and includes accrued but unpaid
interest at least through the date of prepayment calculated at a rate
at least equal to its Annual Percentage Rate. Each DFS Receivable
provides that payments thereon are to be applied in accordance with the
Simple Interest Method. If such DFS Receivable was originated by a
Dealer, such Receivable, to the knowledge of DFS, (A) was originated by
the Dealer for the retail sale of a Financed Vehicle in the ordinary
course of such Dealer's business, (B) was purchased by DFS from such
Dealer for new value under a Dealer Agreement and (C) was validly
assigned by the Dealer to DFS. To the knowledge of DFS, such Dealer had
all necessary licenses and permits to originate DFS Receivables in the
state where such Dealer was located. If such DFS Receivable was
originated by DFS, such DFS Receivable was originated for value by DFS
in the ordinary course of its business to finance the purchase of, or
refinance, the related Financed Vehicle by the related Obligor. DFS had
all necessary licenses and permits to originate or purchase such DFS
Receivable at the time of such origination and purchase. The DFS
Receivables were selected at random by DFS from
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its portfolio of recreational vehicle receivables originated by DFS or
acquired by DFS from Dealers.
(ii) No Fraud or Misrepresentation. To the knowledge of DFS,
each DFS Receivable originated by a Dealer was originated by the Dealer
and sold by the Dealer to DFS without any fraud or misrepresentation on
the part of such Dealer.
(iii) Compliance with Law. To the knowledge of DFS, all
requirements of applicable federal, state and local laws, and
regulations thereunder (including, without limitation, usury laws, the
Federal Truth-in- Lending Act, the Equal Credit Opportunity Act, the
Fair Credit Billing Act, the Fair Credit Reporting Act, the Fair Debt
Collection Practices Act, the Federal Trade Commission Act, the
Magnuson-Moss Warranty Act, the Federal Reserve Board's Regulations "B"
and "Z", the Soldiers' and Sailors' Civil Relief Act of 1940, state
motor vehicle retail installment sales acts and lending acts and state
adaptations of the National Consumer Act and of the Uniform Consumer
Credit Code and other consumer credit laws and equal credit opportunity
and disclosure laws) in respect of all of the DFS Receivables and each
and every sale of Financed Vehicles relating thereto, have been
complied with in all material respects, and each DFS Receivable and the
sale of the Financed Vehicle evidenced by each DFS Receivable complied
at the time it was originated or made and now complies in all material
respects with all applicable legal requirements, including the laws and
regulations contemplated by this clause (iii).
(iv) Origination. Each DFS Receivable was originated in the
United States of America.
(v) Binding Obligation. Each DFS Receivable represents the
genuine, legal, valid and binding payment obligation of the Obligor
thereon, enforceable by the holder thereof in accordance with its
terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization or 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; and
all parties to each DFS Receivable had full legal capacity to execute
and deliver such DFS Receivable and all other documents related thereto
and to grant the security interest purported to be granted thereby.
(vi) No Government Obligor. No Obligor of a DFS Receivable is
the United States of America or any State or any agency, department,
subdivision or instrumentality thereof.
(vii) Obligor Bankruptcy. At the Cutoff Date, no Obligor had
been identified on the records of DFS as being the subject of a current
bankruptcy proceeding.
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(viii) Schedule of Receivables. The information with respect
to DFS Receivables set forth in the Schedule of Receivables is true and
correct in all material respects as of the close of business on the
Cutoff Date.
(ix) Marking Records. By the Closing Date, DFS shall have
caused the portions of its electronic ledger relating to the DFS
Receivables to be clearly and unambiguously marked to show that the DFS
Receivables have been transferred absolutely from DFS to Ganis, from
Ganis to the Depositor and from the Depositor to the Trust.
(x) Computer Tape. The Computer Tape was complete and accurate
as of the Cutoff Date and includes a description of the same DFS
Receivables that are described in the Schedule of Receivables.
(xi) Chattel Paper. The DFS Receivables constitute chattel
paper within the meaning of the UCC as in effect in the states in which
the Obligors reside.
(xii) One Original. There is only one original executed copy
of each DFS Receivable.
(xiii) Receivable Files Complete. There exists a Receivable
File pertaining to each DFS Receivable and, to the knowledge of DFS,
such Receivable File contains (a) a fully executed original of the DFS
Receivable, with a fully executed assignment thereof in blank or from
the related Dealer to DFS, as the case may be, if such DFS Receivable
was acquired by DFS from a Dealer, (b) a certificate of physical damage
insurance, application form for such insurance signed by the Obligor or
a signed representation letter from the Obligor named in the DFS
Receivable pursuant to which the Obligor has agreed to obtain physical
damage insurance for the Financed Vehicle, or copies thereof, (c) the
Lien Certificate or a copy of the application therefor or a
certification from the Servicer that it has received confirmation from
an authorized official of the appropriate governmental office of the
existence of the first lien of DFS with respect to the related Financed
Vehicle and (d) a credit application signed by the Obligor, or a copy
thereof. Each of such documents which is required to be signed by the
Obligor has been signed by the Obligor in the appropriate spaces. Each
of the foregoing documents has been correctly prepared. The complete
file for each DFS Receivable currently is in the possession of the
Servicer.
(xiv) Receivables in Force. No DFS Receivable has been
satisfied, subordinated or rescinded, and the Financed Vehicle securing
each such DFS Receivable has not been released from the lien of the
related DFS Receivable in whole or in part. No provisions of any DFS
Receivable have been waived, altered or modified (except that DFS as
servicer may have, for administrative purposes, modified the due date
of a DFS Receivable to a different date in the month, which
modification is reflected in its
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servicing records) in any respect since its origination, except by
instruments or documents identified in the Receivable File. No DFS
Receivable has been modified as a result of application of the
Soldiers' and Sailors' Civil Relief Act of 1940, as amended.
(xv) Lawful Assignment. No DFS Receivable was originated in,
or is subject to the laws of, any jurisdiction the laws of which (a)
would make unlawful, void or voidable the transfer and assignment of
such DFS Receivable under this Agreement or the pledge of such DFS
Receivable under the Indenture or (b) would impair the validity or
enforceability of any DFS Receivable because of any such transfer,
assignment or pledge.
(xvi) Good Title. No DFS Receivable has been sold,
transferred, assigned or pledged by DFS except pursuant to this
Agreement; immediately prior to the conveyance of the DFS Receivables
by DFS to Ganis pursuant to this Agreement, DFS had good and
indefeasible title to the DFS Receivables, free and clear of any Lien.
No Dealer has a participation in, or other right to receive, payments
or proceeds in respect of any DFS Receivable. DFS has not taken any
action to convey any right to any Person that would result in such
Person having a right to payments received under the related Insurance
Policies or the related Dealer Agreements or to payments due under such
DFS Receivables. This Agreement is effective to transfer to the
Transferor all of the right, title and interest of DFS in, to and under
the DFS Receivables.
(xvii) Security Interest in Financed Vehicle. Each DFS
Receivable has created a valid, binding and enforceable first priority
security interest in favor of DFS in the related Financed Vehicle,
which is in full force and effect. Each Lien Certificate contained in
the Receivables Files shows DFS named as the original secured party
under each DFS Receivable and as the holder of a first priority
security interest in such Financed Vehicle. With respect to each DFS
Receivable for which the Lien Certificate is not contained in the
related Receivable File, the Servicer has either received written
evidence that such Lien Certificate showing DFS as first lienholder has
been applied for or has certified in writing in the related Receivable
File that it has received confirmation from the appropriate
governmental office of the existence of the first lien of DFS with
respect to the related Financed Vehicle. The security interest of DFS
in each such Financed Vehicle has been validly assigned by DFS to Ganis
pursuant to this Agreement. Each DFS Receivable is secured by an
enforceable and perfected first priority security interest in the
Financed Vehicle in the name of DFS as secured party, which security
interest is prior to all other Liens upon and security interests in
such Financed Vehicle.
(xviii) All Filings Made; Valid Security Interest. All filings
(including, without limitation, UCC filings) required to be made by any
Person and actions required to be taken or performed by any Person in
any jurisdiction to give Ganis a first priority perfected ownership
interest in the DFS Receivables and the proceeds thereof have been
made, taken or performed, subject to the transfer thereof by Ganis to
the Depositor. At
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the Closing Date Ganis shall have a valid, subsisting and enforceable
first priority ownership interest in each Receivable and the proceeds
thereof, subject to the transfer thereof by Ganis to the Depositor.
(xix) No Impairment. DFS has not done and shall not do
anything to convey any right to any Person that would result in such
Person having a right to payments due under a Receivable or otherwise
to impair the rights of the Trust in any Receivable or the proceeds
thereof.
(xx) No Release. No DFS Receivable is assumable by another
Person in a manner which would release the Obligor thereof from such
Obligor's obligations to DFS with respect to such DFS Receivable.
(xxi) No Defenses. No DFS Receivable is subject to any right
of rescission, setoff, counterclaim or defense and, to the knowledge of
DFS, no such right has been asserted or threatened with respect to any
DFS Receivable. The operation of the terms of any DFS Receivable or the
exercise of any right thereunder shall not render the DFS Receivable
unenforceable in whole or in part or subject to any right of
rescission, setoff, counterclaim or defense, and to the knowledge of
DFS, no such right of rescission, setoff, counterclaim or defense has
been asserted or threatened with respect thereto.
(xxii) No Default. To the knowledge of DFS, there has been no
default, breach, violation or event permitting acceleration under the
terms of any DFS Receivable (other than payment delinquencies as of the
Cutoff Date of not more than 59 days), and no condition exists or event
has occurred and is continuing that with notice, the lapse of time or
both would constitute a default, breach, violation or event permitting
acceleration under the terms of any DFS Receivable, and there has been
no waiver of any of the foregoing. As of the Cutoff Date, no Financed
Vehicle relating to any DFS Receivable had been repossessed.
(xxiii) Insurance. Each DFS Receivable requires the Obligor to
maintain physical loss and damage insurance, naming DFS and its
successors and assigns as additional insured parties or loss payees ,
and each DFS Receivable permits the holder thereof to obtain physical
loss and damage insurance at the expense of the Obligor if the Obligor
fails to do so. No Financed Vehicle relating to any DFS Receivable was
insured under a policy of force-placed insurance on the Cutoff Date.
(xxiv) Past Due. At the Cutoff Date, no DFS Receivable was
more than 59 days past due.
(xxv) No Liens. There are no Liens or claims which have been
filed, and, to the knowledge of DFS, none pending or threatened to be
filed, for work, labor, materials or unpaid state or federal taxes
affecting the Financed Vehicle securing any DFS
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Receivable which are or may become liens prior or equal to the lien of
the DFS Receivable.
(xxvi) Remaining Principal Balance. At the Cutoff Date, the
Principal Balance of each DFS Receivable set forth in the Schedule of
Receivables is true and accurate in all material respects.
(xxvii) Final Scheduled Maturity Date. No Receivable has a
final maturity which is sooner than the first Monthly Payment Date
following the Closing Date or later than 240 months after the Cutoff
Date.
(xxviii) Certain Characteristics. (A) Each Receivable had a
remaining maturity, as of the Cutoff Date, of at least 2 months but not
more than 240 months; (B) each Receivable had an original maturity of
at least 12 months but not more than 240 months; (C) each Receivable
had an original principal balance of at least $1,313.31 and not more
than $889,770.23; (D) each Receivable had a Principal Balance as of the
Cutoff Date of at least $153.62 and not more than $873,403.15; (E) as
of the Cutoff Date, each Receivable has an Annual Percentage Rate of at
least 4.00% and not more than 18.50%; (F) approximately 50.52% of the
aggregate Principal Balance of the Receivables (measured as of the
Cutoff Date), constituting 56.18% of the number of such Receivables,
were secured by used Financed Vehicles at the time such Receivables
were originated; (G) no funds have been advanced by DFS, any Dealer, or
any Person acting on behalf of any of them in order to cause any DFS
Receivable to qualify under paragraph (xxv) above; (H) as of the Cutoff
Date, other than California (19.74%), Florida (9.20%), Oregon (6.93%)
and Texas (11.06%), no State represented more than 5% of the Initial
Pool Balance with respect to the billing addresses of the Obligors
(determined by reference to the records of DFS); and (I) the Principal
Balance of each DFS Receivable set forth in Schedule of Receivables is
true and accurate in all material respects as of the Cutoff Date. As of
the Cutoff Date, the sum of the Principal Balances of the Receivables
which are Step Rate Receivables does not exceed 1% of the Initial Pool
Balance.
For purposes of determining whether DFS is obligated to
purchase a Receivable on account of a breach of a representation and
warranty pursuant to this Section 3.01 or indemnify in respect of such
breach pursuant to the last paragraph of this Section 3.01, the
determination as to whether a representation or warranty that is made
to the knowledge of DFS has been breached shall be made without regard
to such knowledge of DFS as if such representation and warranty were
not qualified by the knowledge of DFS.
Upon discovery by any party hereto of a breach of any of the
representations and warranties of DFS set forth in this Section, which
materially and adversely affects the value of the Receivables or the
interest therein of the Issuer or the Indenture Trustee (or which
materially and adversely affects the interest of the Issuer or the
Indenture Trustee
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in the related Receivable in the case of a representation and warranty
relating to a particular Receivable), the party discovering such breach
shall give prompt written notice to the other parties hereto. On the
last day of the Collection Period following the Collection Period
during which DFS discovers or receives notice of any such breach of any
such representation or warranty, if such breach shall not have been
cured in all material respects by such last day, DFS shall purchase
such Receivable from the Issuer (or from the Depositor, if the
Depositor is required to purchase such Receivable pursuant to Section
3.01 of the Transfer and Servicing Agreement) as of such last day at a
price equal to the Purchase Amount of such Receivable, which price DFS
shall remit in the manner specified in Section 5.05 of the Transfer and
Servicing Agreement; provided, that, with respect to the representation
set forth in paragraph (xiii) above, such purchase shall be required
with respect to a Receivable only if any resulting breach is not cured
(it being understood that if the related Lien Certificate has been duly
applied for from the applicable governmental offices as evidenced by a
copy of the application therefor, the receipt of such Lien Certificate
shall not be required to cure a breach of the applicable representation
and warranty) within 90 days after completion of the review and
examination of the Receivable File for such Receivable pursuant to
Section 3.02 of the Transfer and Servicing Agreement. Subject to the
indemnification provisions contained in the last paragraph of this
Section, the sole remedy of Ganis, the Depositor, the Issuer, the Owner
Trustee, the Indenture Trustee, the Residual Interestholder and the
Noteholders with respect to a breach of representations and warranties
of DFS set forth in this Section shall be to require DFS to purchase
Receivables pursuant to this Section, subject to the conditions
contained herein.
DFS shall indemnify Ganis, the Depositor, the Issuer, the
Owner Trustee and the Indenture Trustee and hold each harmless against
any loss, damages, penalties, fines, forfeitures, legal fees and
related costs, judgments, and other costs and expenses resulting from
any claim, demand, defense or assertion based on or grounded upon, or
resulting from, a breach of the representations and warranties of DFS
contained in this Agreement; provided that DFS shall not be liable for
any indirect damages or for any loss, damage, penalty, fine,
forfeiture, legal fees and related costs, judgments and other costs and
expenses caused by the wilful misconduct of Ganis, the Issuer, the
Owner Trustee or the Indenture Trustee.
ARTICLE IV
DFS
SECTION 4.01. Representations of DFS. DFS makes the following
representations on which each of Ganis, the Depositor and the Issuer is deemed
to have relied in acquiring the Receivables. The representations speak as of the
execution and delivery of this Agreement and as of the Closing Date, in the case
of the Receivables, and shall survive the transfer of the
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Receivables to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture.
(a) Organization and Good Standing. DFS is duly organized and validly
existing as a corporation in good standing under the laws of the State of
Nevada, with the corporate power and authority to own its properties and to
conduct its business as such properties are currently owned and such business is
presently conducted, and had at all relevant times, and has, the corporate
power, authority and legal right to acquire and own the Receivables.
(b) Due Qualification. DFS 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 property
or the conduct of its business shall require such qualifications.
(c) Power and Authority. DFS has the corporate power and authority to
execute and deliver this Agreement and to carry out its respective terms; DFS
has full power and authority to transfer and assign the property to be
transferred and assigned to Ganis, and DFS shall have duly authorized such
transfer and assignment by all necessary corporate action; and the execution,
delivery and performance of this Agreement by DFS has been duly authorized by
DFS by all necessary corporate action.
(d) Binding Obligation. This Agreement constitutes a legal, valid and
binding obligation of DFS enforceable in accordance with its terms.
(e) No Violation. The consummation of the transactions contemplated by
this Agreement by DFS and the fulfillment of the terms hereof by DFS do not
conflict with, result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time) a default under, the
articles of incorporation or bylaws of DFS, or any indenture, agreement or other
instrument to which DFS 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 or other instrument (other than pursuant
to the Basic Documents); or violate any law or, to the best of the knowledge of
DFS, any order, rule or regulation applicable to DFS of any court or of any
federal or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over DFS or its properties.
(f) No Proceedings. To the best knowledge of DFS, there are no
proceedings or investigations pending or threatened before any court, regulatory
body, administrative agency or other governmental instrumentality having
jurisdiction over DFS or its properties: (i) asserting the invalidity of this
Agreement, the Indenture or any of the other Basic Documents, the Notes or the
Certificates, (ii) seeking to prevent the issuance of the Notes or the
Certificates or the consummation of any of the transactions contemplated by this
Agreement, the Indenture or any of the other Basic Documents, (iii) seeking any
determination or ruling that might materially and adversely affect the
performance by DFS of its obligations under, or the validity or
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enforceability of, this Agreement, the Indenture, any of the other Basic
Documents, the Notes or the Certificates or (iv) which might adversely affect
the federal or state income tax attributes of the Notes or the Certificates.
(g) Chief Executive Office. The chief executive office of DFS is
located at 655 Maryville Centre Drive, St. Louis, Missouri 63141.
SECTION 4.02. Corporate Existence. During the term of this Agreement,
DFS shall keep in full force and effect its existence, rights and franchises as
a corporation under the laws of the jurisdiction of its incorporation and shall
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 Agreement, the Basic Documents and each other instrument
or agreement necessary or appropriate to the proper administration of this
Agreement and the transactions contemplated hereby.
SECTION 4.03. Liability of DFS . DFS shall be liable in accordance
herewith only to the extent of the obligations specifically undertaken by DFS
under this Agreement.
SECTION 4.04. Indemnification. (a) DFS shall indemnify, defend and hold
harmless Ganis against any taxes that may at any time be asserted against Ganis
with respect to any sales, tangible personal property, privilege or license
taxes relating to this Agreement (but not including any taxes asserted with
respect to, and as of the date of, the transfer of the Receivables to Ganis or
the issuance and original sale of the Notes and the Residual Interest, or
asserted with respect to ownership of the Receivables, or federal or other
income taxes) and costs and expenses in defending against the same.
(b) DFS shall indemnify, defend and hold harmless Ganis and any of the
officers, directors, employees and agents of Ganis from and against any loss,
liability or expense incurred by reason of the willful misfeasance of DFS, bad
faith or negligence in the performance of its duties under this Agreement, or by
reason of reckless disregard of its obligations and duties under this Agreement.
Indemnification under this Section shall survive termination of this
Agreement and the other Basic Documents and shall include reasonable fees and
expenses of counsel and expenses of litigation. If DFS shall have made any
indemnity payments pursuant to this Section and the Person to or on behalf of
whom such payments are made thereafter shall collect any of such amounts from
others, such Person shall promptly repay such amounts to DFS, without interest.
SECTION 4.05. Merger or Consolidation of, or Assumption of the
Obligations of, DFS. Any Person (a) into which DFS may be merged or
consolidated, (b) which may result from any merger or consolidation to which DFS
shall be a party or (c) which may succeed to the properties and assets of DFS
substantially as a whole, which Person in any of the foregoing cases executes an
agreement of assumption to perform every obligation of DFS under this
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Agreement, shall be the successor to DFS hereunder without the execution or
filing of any document or any further act by any of the parties to this
Agreement; provided, however, that (i) immediately after giving effect to such
transaction, no representation or warranty made by DFS in Section 3.01 shall
have been breached (unless the applicable breach shall have been cured in all
material respects, or the applicable Receivable shall have been purchased in
accordance herewith), (ii) DFS shall have delivered to Ganis, 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 and that all conditions precedent, if any,
provided for in this Agreement relating to such transaction have been complied
with, (iii) DFS shall have delivered to the Owner Trustee and the Indenture
Trustee an Opinion of Counsel either (A) stating that, in the opinion of such
counsel, all financing statements and continuation statements and amendments
thereto have been executed and filed that are necessary fully to preserve and
protect the interest of the Owner Trustee and Indenture Trustee, respectively,
in the DFS Receivables and reciting the details of such filings, or (B) stating
that, in the opinion of such counsel, no such action shall be necessary to
preserve and protect such interests. Notwithstanding anything herein to the
contrary, the execution of the foregoing agreement of assumption and compliance
with clauses (i), (ii), and (iii) above shall be conditions to the consummation
of the transactions referred to in clauses (a), (b) or (c) above.
SECTION 4.06. Limitation on Liability of DFS and Others. DFS and any
director, officer, employee or agent of DFS 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 hereunder. DFS shall not
be under any obligation to appear in, prosecute or defend any legal action that
shall not be incidental to its obligations under this Agreement, and that in its
opinion may involve it in any expense or liability.
ARTICLE V
Miscellaneous
SECTION 5.01. Amendment. This Agreement may be amended by the parties
hereto, with the consent of the Indenture Trustee, but without the consent of
any other Person; provided, however, that no such amendment shall be effective
unless either (a) the Owner Trustee and the Indenture Trustee shall have been
delivered an Opinion of Counsel to the effect that such amendment shall not
adversely affect in any material respect the interests of any Noteholder or the
Residual Interestholder, or (b) the Holders of 100% of the Outstanding Amount of
the Notes shall have consented to such amendment.
Promptly after the execution of any such amendment or consent, Ganis
shall furnish written notification of the substance of such amendment or consent
to the Indenture Trustee and each of the Rating Agencies.
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Prior to the execution of or the consent to any amendment to this
Agreement, the Indenture Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that the execution of or the consent to such
amendment is authorized or permitted by this Agreement. The Indenture Trustee
may, but shall not be obligated to, consent to any such amendment which affects
the Indenture Trustee's own rights, duties or immunities under this Agreement or
otherwise.
SECTION 5.02. Protection of Title; Change of Name, Identity, Corporate
Structure or Location, Etc.
(a) DFS shall execute and file such financing statements and cause to
be executed and filed such continuation statements, all in such manner and in
such places as may be required by law fully to preserve, maintain and protect
the interest of Ganis, the Issuer and of the Indenture Trustee in the
Receivables and in the proceeds thereof. DFS 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) DFS shall not change its name, identity or corporate structure in
any manner that would, could or might make any financing statement or
continuation statement filed in accordance with paragraph (a) above seriously
misleading within the meaning of Section 9- 402(7) of the UCC, unless it shall
have given Ganis, the Owner Trustee and the Indenture Trustee at least five
days' prior written notice thereof and shall have promptly filed appropriate
amendments to all previously filed financing statements or continuation
statements.
(c) DFS shall give Ganis, the Owner Trustee and the Indenture Trustee
at least 60 days' prior written notice of any relocation of its chief 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 and shall promptly file
any such amendment or new financing statement.
(d) If at any time DFS shall propose to sell, grant a security interest
in, or otherwise transfer any interest in recreational vehicle receivables to
any prospective purchaser, lender or other transferee, DFS shall give (or shall
cause the Servicer to give) to such prospective purchaser, lender or other
transferee computer tapes, records or printouts (including any restored from
backup archives) that, if they shall refer in any manner whatsoever to any DFS
Receivable, shall indicate clearly that such DFS Receivable has been transferred
by DFS to Ganis and by Ganis to the Issuer and is owned by the Issuer and has
been pledged to the Indenture Trustee.
SECTION 5.03. Notices. All demands, notices, directions, communications
and instructions upon, to, or by DFS, Ganis, the Depositor, the Issuer, the
Owner Trustee, the Indenture Trustee or the Rating Agencies under this Agreement
shall be in writing, personally delivered or mailed by certified mail, return
receipt requested, and shall be deemed to have been duly given upon receipt (a)
in the case of DFS, to Deutsche Financial Services Corporation, 655
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Maryville Centre Drive, St. Louis, Missouri 63141, Attention: Senior Vice
President/Treasurer or Chief Legal Officer, (b) in the case of Ganis, to Ganis
Credit Corporation, 660 Newport Center Drive, Newport Beach, California 92660,
Attention: Senior Vice President, (c) in the case of the Depositor, to Deutsche
Recreational Asset Funding Corporation, 655 Maryville Centre Drive, St. Louis,
Missouri 63141, Attention: President, (d) in the case of the Issuer or the Owner
Trustee, at the Corporate Trust Office (as defined in the Trust Agreement), (e)
in the case of the Indenture Trustee, at the Corporate Trust Office, (f) in the
case of Fitch, to Fitch IBCA, Inc., One State Street Plaza, New York, New York
10004, Attention: Asset-Backed Securities Surveillance Group, and (g) in the
case of Standard & Poor's, to Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc., 25 Broadway (15th Floor), New York, New York
10004, Attention: Asset Backed Surveillance Department; or, as to each of the
foregoing, at such other address as shall be designated by written notice to the
other Persons listed in this Section.
SECTION 5.04. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 4.05 of this Agreement, this
Agreement may not be assigned by DFS. DFS hereby acknowledges and consents to
(i) the transfer by Ganis to the Depositor pursuant to the Ganis/Depositor
Transfer Agreement of all right, title and interest of Ganis in, to and under
(but none of the obligations of Ganis under) the DFS Conveyed Property and this
Agreement, (ii) the transfer by the Depositor to the Issuer pursuant to the
Transfer and Servicing Agreement of all right, title and interest of the
Depositor in, to and under (but none of the obligations of the Depositor under)
the DFS Conveyed Property and this Agreement, including the representations and
warranties of DFS in this Agreement, together with all rights of Ganis with
respect to any breach thereof, including the right to require DFS to purchase
Receivables in accordance with this Agreement, and (iii) the other terms of and
transactions contemplated by the Transfer and Servicing Agreement and the other
Basic Documents.
SECTION 5.05. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of DFS, Ganis, the Depositor, the Servicer,
the Issuer, the Owner Trustee, the Indenture Trustee and the Noteholders, and,
except as expressly provided in this Agreement, nothing in this Agreement shall
be construed to give to any other Person any legal or equitable right, remedy or
claim under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.
SECTION 5.06. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 5.07. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
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SECTION 5.08. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 5.09. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE PERFECTION (AND THE EFFECT OF
PERFECTION OR NON-PERFECTION) OF THE INTERESTS OF ANY PERSON IN CONVEYED
PROPERTY ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW
YORK.
SECTION 5.10. Nonpetition Covenants. Notwithstanding any prior
termination of this Agreement, DFS shall not acquiesce, petition or otherwise
invoke or cause the Issuer to invoke the process of any court or government
authority for the purpose of commencing or sustaining a case against the Issuer
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 any substantial part of its property, or
ordering the winding up or liquidation of the affairs of the Issuer.
Notwithstanding any prior termination of this Agreement, DFS shall not
acquiesce, petition or otherwise invoke or cause the Depositor to invoke the
process of any court or government authority for the purpose of commencing or
sustaining a case against 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 Depositor or
any substantial part of its property, or ordering the winding up or liquidation
of the affairs of the Depositor.
SECTION 5.11. Waiver. Each party hereto hereby (a) acknowledges that
Mayer, Brown & Platt represents (i) DFS, the Transferor, and the Depositor in
connection with the transactions contemplated by the Basic Documents, (ii)
Affiliates of the Transferor, DFS and the Depositor in other matters, (iii)
underwriters of the Notes (and Affiliates of underwriters of the Notes) in other
matters, (iv) the institutions which are the Indenture Trustee and the Owner
Trustee (and Affiliates of such institutions) in other matters, and (v) the
Specified Accountants in other matters, and (b) waives any conflict of interest
relating thereto. Notwithstanding any other provision of this Agreement, Mayer,
Brown & Platt is entitled to rely on this Section.
SECTION 5.12. Separate Corporate Existence. Each party hereto hereby
acknowledges that the Trust is entering into the transactions contemplated by
the Basic Documents in reliance upon (i) the identity of DFS as a legal entity
separate from the Depositor and (ii) the identity of Ganis as a legal entity
separate from the Depositor. Therefore, each party hereto shall take all
reasonable steps to make it apparent to third Persons that the Depositor is an
entity with assets and liabilities distinct from those of DFS and Ganis and that
the Depositor is not a division of DFS, Ganis or any other Person. Without
limiting the foregoing, each party hereto shall operate
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and conduct its respective businesses and otherwise act in a manner which is
consistent with Section 10.13 of the Transfer and Servicing Agreement.
SECTION 5.13. Submission to Jurisdiction. Each of the parties hereto
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any other Basic Document or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Person at its
address set forth in Section 5.03 or at such other address notified to the other
party to this Agreement pursuant thereto; and
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to sue
in any other jurisdiction.
[SIGNATURES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this DFS/Ganis
Transfer Agreement to be duly executed by their respective officers as of the
day and year first above written.
DEUTSCHE FINANCIAL SERVICES CORPORATION
By: /s/ Richard C. Goldman
-------------------------------------
Name: Richard C. Goldman
-----------------------------------
Title: Senior Vice President
----------------------------------
By: /s/ Richard H. Schumacher
-------------------------------------
Name: Richard H. Schumacher
-----------------------------------
Title: Senior Vice President
----------------------------------
GANIS CREDIT CORPORATION
By: /s/ Richard C. Goldman
-------------------------------------
Name: Richard C. Goldman
-----------------------------------
Title: Vice President
----------------------------------
By: /s/ Richard H. Schumacher
-------------------------------------
Name: Richard H. Schumacher
-----------------------------------
Title: Assistant Treasurer
----------------------------------
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