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REGISTRATION NO. 333-81455
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 2
TO FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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RYDER VEHICLE LEASE TRUST 1999-A
(Issuer with respect to the Notes)
RYDER FUNDING LP
(Originator of the Trust described herein and Transferor of the 99% Vehicle
SUBI Certificate to the Trust)
RYDER TRUCK RENTAL LT
(Issuer with respect to the SUBI and the 99% SUBI Certificates)
RYDER TRUCK RENTAL I LP
(Originator of Ryder Truck Rental LT and transferor of the SUBI and the 99%
SUBI Certificates to the Transferor)
(Exact name as specified in Originator's charter)
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<S> <C> <C>
Delaware 7513 52-7000600
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)
</TABLE>
3600 NW 82ND AVENUE
MIAMI, FLORIDA 33166
(305) 500-3254
(Address, including zip code, and telephone number, including area
code, of principal executive offices of Ryder Funding LP,
Ryder Truck Rental LT and Ryder Truck Rental I LP)
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SERGE G. MARTIN, ESQ.
STEEL HECTOR & DAVIS LLP
200 SOUTH BISCAYNE BOULEVARD
MIAMI, FLORIDA 33131-2398
(305) 577-7000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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COPIES TO:
DALE W. LUM, ESQ.
BROWN & WOOD LLP
555 CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94104
(415) 772-1200
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Approximate date of commencement of proposed sale to the public: As soon
as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
PROPOSED TITLE OF EACH CLASS OF AMOUNT TO OFFERING AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED BE REGISTERED PRICE PER UNIT(1) OFFERING PRICE(1) FEE(1)(4)
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Asset Backed Notes, Class A-1.................... $250,000 100% $250,000 $69.50
Asset Backed Notes, Class A-2.................... $250,000 100% $250,000 $69.50
Asset Backed Notes, Class A-3.................... $250,000 100% $250,000 $69.50
Asset Backed Notes, Class A-4.................... $250,000 100% $250,000 $69.50
99% 1999-A Special Unit of Beneficial
Interest Certificate(2)................. (3) (3) (3) (3)
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(1) Estimated solely for the purpose of calculating the registration fee.
(2) The 1999-A Special Unit of Beneficial Interest (the "Lease SUBI")
issued by Ryder Truck Rental LT will constitute a beneficial interest
in a specified portion of the assets of Ryder Truck Rental LT,
including certain lease contracts. The 1999-A2 Special Unit of
Beneficial Interest (the "Vehicle SUBI") issued by Ryder Truck Rental
LT will constitute a beneficial interest in a specified portion of the
assets of Ryder Truck Rental LT, including certain vehicles relating to
such lease contracts. The Lease SUBI and the Vehicle SUBI
(collectively, the "SUBI," and each, a "1999-A SUBI") will not be
offered to investors hereunder. A 99% Special Unit of Beneficial
Interest Certificate will be issued for each 1999-A SUBI (the "SUBI
Certificates") representing a 99% undivided interest in each 1999-A
SUBI. The SUBI Certificate for the Lease SUBI will be pledged and the
SUBI Certificate for the Vehicle SUBI will be transferred to the Owner
Trustee for the Ryder Vehicle Lease Trust 1999-A issuing the Asset
Backed Notes, Class A-1, Class A-2, Class A-3 and Class A-4. The SUBI
Certificates will not be offered to investors hereunder.
(3) Not applicable.
(4) Previously paid.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
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<PAGE> 2
Subject to Completion, Preliminary
Prospectus dated October 15, 1999
$
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(RYDER LOGO)
ASSET BACKED SENIOR NOTES
RYDER VEHICLE LEASE TRUST 1999-A
ISSUER
RYDER FUNDING LP
TRANSFEROR
RYDER TRUCK RENTAL, INC.
ADMINISTRATIVE AGENT
The trust's main sources for payment of the senior notes will be lease
payments generated by a portfolio of commercial full service lease contracts and
the proceeds from the future sale of the trucks, highway tractors and trailers
currently leased under those contracts.
Interest and principal will be payable quarterly and the first
scheduled payment date is January 17, 2000.
Before you decide to invest, read this prospectus carefully, especially
the risk factors beginning on page __.
THE SENIOR NOTES ARE OBLIGATIONS OF THE TRUST ONLY. THE SENIOR NOTES
ARE NOT OBLIGATIONS OF RYDER FUNDING LP, RYDER TRUCK RENTAL, INC. OR ANY OF
THEIR AFFILIATES.
THE TRUST WILL ISSUE THE FOLLOWING CLASSES OF SENIOR NOTES--
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Original Proceeds to
Principal Interest Rate Final Payment Underwriting the
Amount (per annum) Date Price to Public Discount Transferor
----------- ------------- ------------- --------------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Per Class A-1 Note $__________ _____% __________ _____ __________% _____% ________%
Per Class A-2 Note $__________ _____% __________ _____ __________% _____% ________%
Per Class A-3 Note $__________ _____% __________ _____ __________% _____% ________%
Per Class A-4 Note $__________ _____% __________ _____ __________% _____% ________%
Total ............. $__________ __________% _____% ________%
</TABLE>
o The price to the public and proceeds to the transferor do not include
interest accrued from __________, 1999, the date the notes will be
issued.
o The proceeds to the transferor excludes expenses, estimated at
approximately $__________.
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED THESE
SECURITIES OR DETERMINED THAT THIS PROSPECTUS IS ACCURATE OR COMPLETE. IT IS
ILLEGAL FOR ANYONE TO TELL YOU OTHERWISE.
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MERRILL LYNCH & CO.
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The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the SEC
is effective. This prospectus is not an offer to sell these securities, and it
is not soliciting an offer to buy them, in any state where an offer or sale is
not permitted.
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<PAGE> 3
IMPORTANT NOTICE ABOUT INFORMATION PRESENTED IN THIS PROSPECTUS
CONTENT OF PROSPECTUS
You should rely only on the information contained in this document. We
have not authorized anyone to provide you with different information.
We include cross-references in this prospectus to the captions under
which you can find additional related information. The following table of
contents lists the pages on which these captions are located.
You can find a listing of the pages where capitalized terms used in
this prospectus are defined under the caption "INDEX OF CAPITALIZED TERMS"
beginning on page [131].
LIMITATIONS ON OFFERS OR SOLICITATIONS
We do not intend this document to be an offer or solicitation:
o if used in a jurisdiction in which an offer or solicitation is not
authorized;
o if the person making an offer or solicitation is not qualified to do
so; or
o if an offer or solicitation is made to anyone to whom it is unlawful
to make an offer or solicitation.
DEALER PROSPECTUS DELIVERY REQUIREMENTS
Until ______________, ____ all dealers that effect transactions in the
senior notes, whether or not participating in this offering, may be required to
deliver a prospectus. This requirement is in addition to the dealers' obligation
to deliver a prospectus when acting as underwriters with respect to their unsold
allotments or subscriptions.
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TABLE OF CONTENTS
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PAGE PAGE
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OVERVIEW OF TRANSACTION.............................4
SUMMARY.............................................5
RISK FACTORS.......................................13
OVERVIEW OF THE TRANSACTION........................21
THE TRUST..........................................22
Formation.......................................22
Capitalization..................................23
The Owner Trustee...............................23
Property of the Trust...........................24
USE OF PROCEEDS....................................25
THE ORIGINATION TRUST..............................25
General.........................................25
The UTI Beneficiaries...........................26
The Origination Trustee.........................26
Property of the Origination Trust...............27
Lease Origination and the Titling of Vehicles...27
THE SUBIs..........................................28
General.........................................28
Transfers of the SUBI Certificates..............29
THE TRANSFEROR.....................................30
RYDER..............................................30
General.........................................30
Shared Services Center..........................31
The Leases......................................31
Lease Underwriting Procedures...................37
Insurance.......................................37
Collection, Repossession and Disposition
Procedures Servicing............................38
Lease Payments..................................39
Historical Data.................................42
Delinquency Experience..........................42
Write-off Experience............................43
Residual Value Performance......................43
Year 2000 Preparation...........................44
THE SPECIFIED LEASES...............................47
General.........................................47
Characteristics of the Specified Leases.........47
Representations, Warranties and Covenants.......52
MATURITY, PAYMENT AND YIELD CONSIDERATIONS.........54
NOTE FACTORS AND TRADING INFORMATION...............59
DESCRIPTION OF THE SENIOR NOTES....................60
General.........................................60
Interest........................................60
Principal.......................................61
Optional Purchase...............................63
The Indenture Trustee...........................63
Book-Entry Registration.........................63
CERTAIN INFORMATION REGARDING THE SECURITIES.......68
Payments on the Securities......................68
Optional Purchase...............................70
Statements to Senior Noteholders................71
Definitive Notes................................72
SECURITY FOR THE SECURITIES........................73
General.........................................73
The Program Operating Lease.....................73
The Subordinated Notes..........................75
The Certificates................................75
The Accounts....................................76
The Contingent and Excess Liability Insurance...79
ADDITIONAL DOCUMENT PROVISIONS.....................80
The Indenture...................................80
The Trust Agreement.............................85
The SUBI Trust Agreement........................87
The Administration Agreement....................90
Miscellaneous Provisions.......................103
CERTAIN LEGAL ASPECTS OF THE ORIGINATION TRUST
AND THE SUBIS....................................108
The Origination Trust..........................108
The SUBIs......................................110
Insolvency-Related Matters.....................110
CERTAIN LEGAL ASPECTS OF THE SPECIFIED LEASES
AND THE SPECIFIED VEHICLES.......................113
Back-up Security Interests.....................113
Titling Grade Period--Lack of Perfected
Ownership Interest...........................115
Vicarious Tort Liability.......................116
Repossession of Specified Vehicles.............116
Deficiency Judgments...........................117
Other Limitations..............................117
MATERIAL FEDERAL INCOME TAX CONSEQUENCES..........117
General........................................117
Senior Notes...................................118
CERTAIN STATE TAX CONSEQUENCES....................124
General........................................124
Delaware.......................................125
Florida........................................125
Miscellaneous..................................125
ERISA CONSIDERATIONS..............................126
General........................................126
Prohibited Transactions........................126
RATINGS OF THE SECURITIES.........................127
UNDERWRITING......................................128
LEGAL MATTERS.....................................129
EXPERTS...........................................129
AVAILABLE INFORMATION.............................129
INDEX OF PRINCIPAL TERMS..........................131
INDEX TO FINANCIAL STATEMENTS.....................F-1
GLOBAL CLEARANCE, SETTLEMENT AND TAX
DOCUMENTATION PROCEDURES.........................A-1
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3
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OVERVIEW OF TRANSACTION
[GRAPHIC OMITTED]
o The above special units of beneficial interest, or SUBIs, represent specific
assets that produce income for the issuer.
o The vehicle SUBI represents the specified vehicles and the lease SUBI
represents the specified leases.
o The UTI represents other origination trust assets and the issuer has neither
any rights in those assets nor in the income the produce.
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SUMMARY
o This summary highlights selected information from this prospectus and does
not contain all of the information that you need to consider in making your
investment decision. To understand all of the terms of the offering of the
senior notes, you should carefully read this entire prospectus.
o This summary provides an overview of some calculations, cash flows and
other information to aid your understanding and is qualified by the full
description of these calculations, cash flows and other information in this
prospectus.
BASIC TERMS OF THE SENIOR NOTES
ISSUER/TRUST: Ryder Vehicle Lease Trust 1999-A
TRANSFEROR: Ryder Funding LP
ADMINISTRATIVE
AGENT: Ryder Truck Rental, Inc.
MAINTENANCE
PROVIDER: Ryder Truck Rental, Inc.
OWNER TRUSTEE: Chase Manhattan Bank Delaware
INDENTURE
TRUSTEE: U.S. Bank National Association
ORIGINATION
TRUST: Ryder Truck Rental LT
ORIGINATION
TRUSTEE: RTRT, Inc.
TRUST ASSETS: Beneficial and security interests in leased vehicles and
lease contracts, and related proceeds
LEASES: Commercial leases of trucks, highway tractors and trailers
CUTOFF DATE: Opening of business on October 1, 1999
CREDIT
ENHANCEMENT: A reserve fund, a residual value surplus account, the
subordinated notes retained by the transferor and the
certificates
NOTES TO BE OFFERRED:
Class A-1 notes: $ ___,000,000
Class A-2 notes: $ ___,000,000
Class A-3 notes: $ ___,000,000
Class A-4 notes: $ ___,000,000
INTEREST RATES:
Class A-1 notes: _.___%
Class A-2 notes: _.___%
Class A-3 notes: _.___%
Class A-4 notes: _.___%
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INTEREST BASIS:
Class A-1
notes: Actual number of days elapsed and assuming a 360-day year
Other senior
notes: A 360-day year of twelve 30-day months
PAYMENT
DATES: The first business day after the 14th day of each January,
April, July and October
RECORD DATE: Holders of record are determined one business day
prior to a payment date
FIRST PAYMENT
DATE: January 17, 2000
FINAL PAYMENT DATES:
Class A-1 notes: _________ 15, ____
Class A-2 notes: _________ 15, ____
Class A-3 notes: _________ 15, ____
Class A-4 notes: _________ 15, ____
CLEARANCE AND
SETTLEMENT: The Depository Trust
Company, Cedelbank and
Euroclear
CLOSING DATE: Expected to be ______
___, 1999
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THE STRUCTURE OF THIS TRANSACTION
GENERAL
Ryder Truck Rental, Inc. has assigned commercial lease contracts and the related
leased vehicles to Ryder Truck Rental LT. The leased vehicles include trucks,
highway tractors and trailers. Some of these lease contracts and the related
leased vehicles have been allocated to a separate pool of assets. Beneficial and
security interests - but not direct ownership - in the vehicles and contracts in
that pool will be transferred to the trust. Neither the trust nor holders of the
trust's securities will receive any interest in assets other than those in that
pool. Payment of the senior notes will be backed by those beneficial and
security interests in the vehicles and contracts in the pool.
The trust will apply the net proceeds from the issuance and sale of the senior
notes to purchase those interests in the pool. In addition to the senior notes,
the trust is also issuing $_________ in aggregate principal amount of asset
backed subordinated notes and $_________ in aggregate principal amount of asset
backed certificates. The trust is not offering the subordinated notes or the
certificates under this prospectus.
The trust will rely upon collections from the pool's lease contracts, sales
proceeds from the disposition of the related vehicles and funds on deposit in
specified accounts, to make payments on the senior notes. The trust will be
solely liable for payments made on the senior notes.
REPAYMENT OF THE NOTES
The timing of payments of principal on the senior notes is largely dependent on
the timing of collections of cash flows generated by the underlying assets.
Principal will be paid on your senior notes on each payment date in an amount
generally equal to the available principal distribution amount generated by the
underlying pool of vehicle lease contracts and proceeds from the sale of the
leased vehicles.
Principal payments on the senior notes generally will be made to the holders of
the senior notes sequentially, so that no principal will be paid on any class of
senior notes until each class of senior notes with a lower numerical designation
has been paid in full. For example, no principal will be paid on the Class A-2
Notes until the Class A-1 Notes have been paid in full.
Until all principal due to the senior notes is paid, no principal will be paid
to the subordinated notes and the certificates. Principal will then be paid to
the subordinated notes until they have been paid in full, and then to the asset
backed certificates.
An exception to the sequential payment rule is that allocable principal from the
sale of the trust's assets following a default under the indenture and the
acceleration of the senior notes or the transferor's insolvency will be paid
first, on a pro rata basis, to all classes of the senior notes until they have
been paid in full, and second, ratably, to the subordinated notes (which amounts
will be paid to the reserve fund) and the certificates pro rata until they have
been paid in full.
The unpaid principal amount of each class of senior notes will be payable in
full on the final payment dates listed on the cover page of this prospectus.
Ryder Truck Rental, Inc. will administer the lease contracts, the disposition of
the related vehicles when their leases terminate and the collection of amounts
due in respect of the leases and will also provide maintenance and other
services in connection with the
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leases and the vehicles. It also will be entitled to certain lease payments that
are not being securitized in this transaction and that are thus neither the
property of the issuer nor in any other way available to make payments on the
senior notes. If the total amount that Ryder collects from on a pool lease is
less than the amount due, the shortfall will be allocated pro rata to the
trust's and Ryder's portions of the amount due.
FOR INFORMATION ON THE COMPONENTS OF THE LEASE PAYMENTS THAT THE SENIOR NOTES
WILL OR WILL NOT BE ENTITLED TO AND ON RYDER'S ROLE IN SERVICING THE LEASES, SEE
"RYDER --THE LEASES, --COLLECTION, REPOSSESSION AND DISPOSITION PROCEDURES, --
SERVICING, AND -- LEASE PAYMENTS"
FOR INFORMATION ON THE ALLOCATION OF COLLECTION SHORTFALLS SEE "ADDITIONAL
DOCUMENT PROVISIONS--THE ADMINISTRATION AGREEMENT--COLLECTIONS--FINANCIAL
COMPONENT PAYMENTS".
SEE "DESCRIPTION OF THE SENIOR NOTES -- PRINCIPAL" AND "CERTAIN INFORMATION
REGARDING THE SECURITIES -- PAYMENTS ON THE SECURITIES -- DEPOSITS TO THE
DISTRIBUTION ACCOUNTS; PRIORITY OF PAYMENTS" FOR ADDITIONAL DETAIL REGARDING THE
ALLOCATION OF ANY PRINCIPAL LOSSES OR SHORTFALLS IN AMOUNTS REQUIRED TO BE
DISTRIBUTED TO HOLDERS OF SENIOR NOTES AND THE REIMBURSEMENT OF THOSE LOSSES.
OPTIONAL REDEMPTION OF THE NOTES
The transferor has the option to purchase all of the assets of the trust on any
payment date when the unpaid principal balance of the senior notes is less than
or equal to 10% of the total initial balance of the senior notes, subordinated
notes and asset backed certificates. If the transferor exercises this option,
any senior notes that are outstanding at that time will be prepaid in whole at a
redemption price equal to their unpaid principal amount, plus accrued and unpaid
interest.
THE PROPERTY OF THE TRUST
GENERAL
The primary property of the trust will be:
o the vehicle SUBI certificate, which is described below, including the right
to receive 99% of the amounts realized from sales of specified vehicles;
o the program operating lease under which the trust will lease the vehicle SUBI
certificate to the transferor;
o the right under the program operating lease to receive an amount equal to 99%
of the payments made in respect of the financial component of specified
vehicle leases;
o the pledge by Ryder Funding LP of the lease SUBI certificate to secure the
payments due under program operating lease; and
o the right to certain amounts deposited in the reserve fund and the residual
value surplus account.
THE PROGRAM OPERATING LEASE
When the senior notes are issued, the trust and the transferor will enter into a
program operating lease, under which the trust will lease the vehicle SUBI
certificate to the transferor, subject to the lien of the indenture. Pursuant to
the program operating lease and a pledge of the lease SUBI certificate, the
transferor will be obligated to make payments during the period that each
underlying vehicle is represented by the vehicle SUBI and covered by the program
operating lease.
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The transferor will make payments on the program operating lease before each
payment date in an amount generally equal to certain payments made on or for the
specified leases and specified vehicles during the three-month collection period
immediately before the month in which the related payment date occurs. These
payments consist of:
o the financial component of the fixed charge portion of the total monthly
payment paid under each specified lease, and
o termination value payments made upon the exercise of any annual termination
option included in a specified lease.
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The trust will apply these collected payments, together with certain proceeds
received for the related collection period from the sale or other disposition of
specified vehicles either:
o after the scheduled maturity or other termination of the related specified
leases, or
o as a result of an exercise of the annual termination option when the lessee
does not make a termination value payment,
to pay interest on and principal of the senior notes, the subordinated notes and
the certificates in accordance with their terms.
THE SPECIFIED LEASES AND THE SPECIFIED VEHICLES
The specified vehicles are commercial trucks, highway tractors and trailers
titled in the name of the origination trust or, in some cases, that will be
titled in the name of the origination trust during the 60 days after the
closing. The specified leases are full-service leases of specified vehicles.
Ryder Truck Rental, Inc. originated the specified leases in [26] states and
services the specified leases, as well as many other leases in which the trust
does not have an interest. The initial securitization value of the specified
leases and specified vehicles will be their net book value on the administrative
agent's books and the residual value of the specified vehicles will be their
currently estimated sales proceeds upon the scheduled maturity of their
specified leases. As of October 1, 1999:
o the aggregate securitization value of the specified leases and specified
vehicles was $__________;
o the aggregate estimated sales proceeds of the specified vehicles at scheduled
maturity was $__________;
o the weighted average original term of the specified leases was ____ months;
and
o the weighted average remaining term to scheduled maturity of the specified
leases was _____ months.
THE SUBI CERTIFICATES
The origination trust will issue two special units of beneficial interest, which
are also called SUBIs:
o a lease SUBI that will constitute a beneficial interest in the specified
portfolio of lease contracts, and
o a vehicle SUBI that will constitute a beneficial interest in vehicles that
are leased under those lease contracts.
The SUBIs relating to the trust thus consists of the lease SUBI and the vehicle
SUBI. The SUBIs will not be offered to you under this prospectus.
A 99% SUBI certificate will be issued for each of the lease SUBI and the vehicle
SUBI. One SUBI certificate will represent a 99% undivided interest in the lease
SUBI and the other SUBI certificate will represent a 99% undivided interest in
the vehicle SUBI. The SUBI certificate for the lease SUBI will be pledged and
the SUBI certificate for the vehicle SUBI will be transferred to the trust at
the time it issues the senior notes. The SUBI certificates will not be offered
to you under this prospectus.
The SUBI certificates will evidence a 99% beneficial interest in the SUBI
assets, not a direct ownership interest in the SUBI assets. The SUBI assets are
a portfolio of specified leases and specified vehicles having an aggregate
securitization value as of a cutoff date of $__________. By holding the SUBI
certificates and the program operating lease, the trust will receive an amount
equal to 99% of all payments made on or in respect
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of the SUBI assets. Payments made on or in respect of the 1% beneficial interest
in the SUBI assets not evidenced by the SUBI certificates will not be available
to make payments on the senior notes, the subordinated notes or the
certificates.
The SUBI certificates will not evidence an interest in any origination trust
assets other than the SUBI assets, and payments made on or for all other
origination trust assets will not be available to make payments on the senior
notes.
FOR MORE INFORMATION REGARDING THE TRUST'S PROPERTY SEE "THE SUBIs" AND "THE
SPECIFIED LEASES".
CREDIT ENHANCEMENT
The credit enhancement for the senior notes will consist primarily of the
following:
o subordination of the subordinated notes;
o subordination of the certificates;
o the reserve fund; and
o the residual value surplus account.
SUBORDINATION OF THE SUBORDINATED NOTES
The subordinated notes will be subordinated to the senior notes to provide
credit enhancement for the senior notes.
SUBORDINATION OF THE CERTIFICATES
The certificates will be subordinated to the senior notes to provide additional
credit enhancement for the senior notes.
THE RESERVE FUND
As an additional source of credit enhancement, the administrative agent will
establish a reserve fund. The reserve fund will be funded as follows:
o On the closing date, the transferor will make an initial deposit into the
reserve fund of $__________, which is ___% of the aggregate initial
securitization value of the specified leases and specified vehicles.
o Interest paid on the subordinated notes will be deposited into the reserve
fund.
o On each payment date, any excess interest collections remaining after
interest on the senior notes, subordinated notes and asset backed
certificates and various other obligations and expenses of the trust have
been paid will be deposited into the reserve fund.
Deposits will be made to the reserve fund after the closing date only to the
extent needed to maintain a balance in the reserve fund equal to its initial
deposit. Any further excess interest collections will be paid to the transferor.
Available amounts in the reserve fund on each payment date will be available to
cover shortfalls in distributions of interest and principal on the senior notes
and the certificates.
THE RESIDUAL VALUE SURPLUS ACCOUNT
As an additional source of credit enhancement, a residual value surplus account
will provide funds for the benefit of the senior notes and the certificates in
the event any residual value losses are incurred on the sale of specified
vehicles.
Residual value losses will be any amount by which the net proceeds from the sale
of specified vehicles are less than the aggregate securitization values of those
specified vehicles and their specified leases.
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The residual value surplus account will not be funded with an initial balance,
but before each payment date it will be funded with the amount by which the
sales proceeds for each specified vehicle sold during the preceding collection
period exceeded its securitization value.
After all distributions required on a given payment date have been made, any
funds remaining in the residual value surplus account will be paid to the
transferor.
FOR MORE INFORMATION REGARDING THE RESIDUAL VALUE SURPLUS ACCOUNT, SEE "SECURITY
FOR THE SECURITIES--THE ACCOUNTS--THE RESIDUAL VALUE SURPLUS ACCOUNT".
ADMINISTRATION AND MAINTENANCE
Ryder Truck Rental, Inc. will act as administrative agent to service the
origination trust assets, including the SUBI assets, and will also act as
maintenance provider to provide certain supplies, maintenance and other services
for the specified vehicles and to the lessees under the specified leases.
FOR MORE INFORMATION REGARDING THE ADMINISTRATIVE AGENT AND THE MAINTENANCE
PROVIDER, SEE "ADDITIONAL DOCUMENT PROVISIONS--THE ADMINISTRATION AGREEMENT" AND
"RYDER".
TAX STATUS
Steel Hector & Davis LLP, as special tax counsel to the transferor, is of the
opinion that:
o the senior notes will be characterized as indebtedness for federal income tax
purposes, and
o the trust will not be a separately taxable entity for federal income tax
purposes.
By accepting a senior note, each holder or beneficial owner will agree to treat
the senior notes as indebtedness. You should consult your own tax advisor
regarding the federal income tax consequences of the purchase, ownership and
disposition of the senior notes, and the tax consequences arising under the laws
of any state or other taxing jurisdiction.
FOR MORE INFORMATION, SEE "CERTAIN FEDERAL INCOME TAX CONSEQUENCES".
ERISA CONSIDERATIONS
It is expected that the senior notes will be eligible for purchase by employee
benefit plans. However, plans contemplating a purchase of senior notes should
consult their counsel before making a purchase.
FOR MORE INFORMATION, SEE "ERISA CONSIDERATIONS".
SENIOR NOTE RATINGS
The senior notes will be issued only if the Class A-1 Notes are rated in the
highest short-term rating category and the other senior notes are rated in the
highest long-term category by Moody's Investors Service, Inc. and Duff & Phelps
Credit Rating Co. There can be no assurance that a rating will not be lowered or
withdrawn by an assigning rating agency.
MONEY MARKET INVESTMENT
The Class A-1 Notes have been structured to be eligible securities for purchase
by money market funds under Rule 2a-7 under the Investment Company Act of 1940.
However, money market funds contemplating a purchase of Class A-1 Notes should
consult their counsel before making a purchase.
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<PAGE> 14
RISK FACTORS
You should consider the following risk factors in deciding whether to purchase
the senior notes:
YOU MAY HAVE DIFFICULTY
SELLING YOUR SENIOR NOTES OR
OBTAINING YOUR DESIRED SALES
PRICE. o The senior notes will not be listed on any
securities exchange. The underwriters
intend to make a secondary market for the
senior notes. The underwriters will do so
by offering to buy the senior notes from
investors that wish to sell. However, the
underwriters will not be obligated to make
offers to buy the senior notes and may stop
making offers at any time. In addition, the
prices offered, if any, may not reflect
prices that other potential purchasers
would be willing to pay, were they to be
given the opportunity. There have been
times in the past where there have been
very few buyers of asset backed securities
and thus there has been a lack of
liquidity. There may be a similar lack of
liquidity at times in the future. As a
result, you may not be able to sell your
senior notes when you want to do so, or you
may not be able to obtain the price that
you wish to receive.
YOU WILL EXPERIENCE A LOSS ON
YOUR INVESTMENT IF DEFAULTS ON
THE LEASE CONTRACTS OR RESIDUAL
VALUE LOSSES EXCEED THE
AVAILABLE CREDIT ENHANCEMENT. o The trust does not have, nor is it expected
to have, any significant assets or sources
of funds other than the SUBI certificates
and payments under the program operating
lease, together with available funds in the
reserve fund, the residual value surplus
account and the distribution and collection
accounts. The senior notes represent
obligations solely of the trust and will
not be insured or guaranteed by any entity.
Accordingly, you will rely primarily upon
payments on the program operating lease -
which are based on collections on the
specified leases and specified vehicles -
together with monies on deposit in the
reserve fund and the residual value surplus
account for payments on the senior notes.
The reserve fund and the residual value
surplus account, together with the credit
enhancement provided by subordination of
the subordinated notes and the
certificates, will cover delinquencies on
the specified leases and losses on the
specified leases and specified vehicles up
to some level. However, if the level of
delinquencies and losses exceeds the
available credit enhancement, you will
suffer a loss. You will have no claim to
any amounts properly distributed to others
from time to time.
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<PAGE> 15
YOUR SHARE OF POSSIBLE LOSSES
MAY NOT BE PROPORTIONATE. o Principal payments on the senior notes
generally will be made to the holders of
the senior notes sequentially, so that no
principal will be paid on any class of
senior notes until each class of senior
notes with a lower numerical designation
has been paid in full. Losses in excess of
the available credit enhancement relating
to the specified leases and specified
vehicles will be allocated to each class of
senior notes based on a fraction equal to
the unpaid principal amount of that class
divided by the unpaid principal amount of
all classes. As a result, a class of senior
notes with a later maturity may be
allocated more losses than a class of
senior notes with an earlier maturity as a
relative percentage of their initial
principal amounts.
THE TIMING OF PRINCIPAL
PAYMENTS IS UNCERTAIN. o The amount of distributions of principal on
the senior notes and the time when you
receive those distributions depends on the
rate of payments and losses relating to the
specified leases and the specified
vehicles, which cannot be predicted with
certainty. Those principal payments may be
regularly scheduled payments or unscheduled
payments like those resulting from
prepayments or liquidations of defaulted
specified leases. Additionally, the
administrative agent may be required to
make payments relating to specified leases
and specified vehicles under some
circumstances, and the transferor will have
the right to purchase all assets of the
trust pursuant to a clean-up call. Each of
these payments will have the effect of
shortening the average life of the senior
notes. You will bear any reinvestment risks
resulting from a faster or slower rate of
payments of the specified leases and the
specified vehicles.
DURING A TITLING GRACE PERIOD
THE ORIGINATION TRUST WILL LACK
A PERFECTED OWNERSHIP INTEREST
IN SOME VEHICLES. o During a titling grace period, vehicles
having an aggregate securitization value on
the cutoff date not to exceed $__________,
representing ____% of the aggregate
securitization value of all the assets in
the trust pool, will be titled in the name
of Ryder Truck Rental, Inc. rather than in
the name of the origination trust or the
origination trustee on behalf of the
origination trust. During this grace
period, the administrative agent will title
these vehicles in the name of the
origination trust or the origination
trustee on behalf of the origination trust
but no action will be taken to note a lien
in favor of the transferor on the
applicable certificates of title. An
ownership interest or security
14
<PAGE> 16
interest in a motor vehicle registered in
most states may be perfected against
creditors and subsequent purchasers without
notice for valuable consideration only by
one or more of the following:
o depositing with the state's department
of motor vehicles a properly endorsed
certificate of title for the vehicle
showing the transferee or secured party
as legal owner or lienholder thereon,
o filing a sworn notation of lien with the
state's department of motor vehicles and
noticing such lien on the certificate of
title, or
o if the vehicle has not been previously
registered, filing an application for an
original registration together with an
application for registration of the
secured party as legal owner or
lienholder, as the case may be, with the
state's department of motor vehicles.
The origination trust and the transferor
may thus not have a validly perfected
ownership interest and security interest,
respectively, in some vehicles during the
grace period. As a result, the origination
trust's and the transferor's ownership or
security interest in these vehicles will
not be perfected and the transferor's
interest could be inferior to interests of
other creditors or purchasers who have
taken the steps described above. If such
creditors or purchasers successfully did
so, the affected vehicles would not be
available to generate their expected cash
flow and you could suffer a loss on your
investment.
FOR A DISCUSSION OF THE POSSIBLE LIABILITY
OF THE TRUST IN CONNECTION WITH THE
NEGLIGENT USE OR OPERATION OF THE LEASED
VEHICLES, SEE "CERTAIN LEGAL ASPECTS OF THE
SPECIFIED LEASES AND THE SPECIFIED VEHICLES
--TITLING GRACE PERIOD -- LACK OF PERFECTED
OWNERSHIP INTEREST".
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<PAGE> 17
THE GEOGRAPHIC CONCENTRATION
OF THE LEASES, ECONOMIC FACTORS
AND THE COMMERCIAL TRUCK,
TRACTOR AND TRAILER MARKET
COULD NEGATIVELY AFFECT THE
TRUST'S ASSETS. o The specified leases were originated in
[26] states, with [___]% -- the largest
percentage of specified leases in any state
-- originated in [_____________]. Less than
[___]% of the total number of specified
leases were originated in any states other
than [_____________], [_____________] and
[_____________]. Adverse economic
conditions in one of more of these states
or in the market for commercial trucks,
tractors and trailers may have a
disproportionate impact on the performance
of the specified leases and the specified
vehicles. Economic factors like
unemployment, interest rates, the rate of
inflation and consumer perceptions of the
economy may affect the rate of prepayment
and defaults on the specified leases and
the ability to sell or dispose of the
related specified vehicles for an amount at
least equal to their residual values.
THE ADMINISTRATIVE AGENT AND
THE MAINTENANCE PROVIDER
HAVE INTERESTS BEYOND
SERVICING THE ASSETS OF THE
TRUST AND THEREFORE MAY HAVE
COMPETING OR CONFLICTING
INTERESTS. o Ryder Truck Rental, Inc., in addition to
serving as administrative agent and
maintenance provider, also is and will be
engaged in leasing and providing
maintenance services in connection with its
own vehicles and servicing its own leases.
It therefore may from time to time have
competing interests or conflicts of
interest in performing its obligations with
respect to the maintenance and sale of
specified vehicles and the servicing of
specified leases. Ryder has contractually
agreed that when serving as administrative
agent and maintenance provider it will use
the same degree of skill, care and
attention and the same customary and usual
procedures it employs in connection with
vehicles it leases and maintains for its
own account.
A DEFAULT, REPLACEMENT OR
DECLINE IN THE QUALITY OF THE
SERVICE OF THE ADMINISTRATIVE
AGENT OR THE MAINTENANCE
PROVIDER COULD DELAY OR LIMIT
PAYMENTS TO YOU. o Because the specified leases and specified
vehicles will be serviced and maintained by
the administrative agent and the
maintenance provider, a default by or the
replacement of either could reduce or delay
payments made under the specified leases.
Ryder Truck Rental, Inc. will serve as both
the administrative agent and the
maintenance provider. Any reduction or
delay in the payments made under the
specified leases could cause delays in
payments due to you or limit the amount of
principal and interest paid to you. A
decline in the quality of service provided
by the administrative agent or the
maintenance provider could also cause
delays in payments due to you or limit the
amount of principal and interest paid to
you.
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<PAGE> 18
VICARIOUS TORT LIABILITY MAY
RESULT IN A LOSS ON YOUR
INVESTMENT. o Some states allow a party that incurs an
injury involving a leased vehicle to sue
the owner of the vehicle merely because of
that ownership. Most states, however,
either prohibit these vicarious liability
suits or limit the lessor's liability to
the amount of liability insurance that the
lessee was required to carry under
applicable law but failed to maintain. If
vicarious liability imposed on the
origination trust exceeds the coverage
provided by its primary and excess
liability insurance policies, you could
experience delays in payments due to you or
may ultimately suffer a loss.
FOR A DISCUSSION OF THE POSSIBLE LIABILITY
OF THE TRUST IN CONNECTION WITH THE USE OR
OPERATION OF THE LEASED VEHICLES, SEE
"CERTAIN LEGAL ASPECTS OF THE SPECIFIED
LEASES AND THE SPECIFIED VEHICLES
--VICARIOUS TORT LIABILITY".
A BANKRUPTCY OF THE
TRANSFEROR OR THE
ADMINISTRATIVE AGENT COULD
DELAY OR LIMIT PAYMENTS TO
YOU. o Following a bankruptcy or insolvency of the
administrative agent or the transferor, a
court could conclude that the vehicle SUBI
certificate is owned by the administrative
agent or the transferor, instead of the
trust. This conclusion could be either
because the transfer of the vehicle SUBI
certificate from the transferor to the
trust was not a TRUE SALE or because the
court concluded that the transferor or the
trust should be treated as the same entity
as administrative agent or the transferor
for bankruptcy purposes. If this were to
occur, you could experience delays in
payments due to you or may not ultimately
receive all interest and principal due to
you as a result of:
o the AUTOMATIC STAY which prevents a
secured creditor from exercising
remedies against a debtor in bankruptcy
without permission from the court; and
o the fact that neither the trust nor the
indenture trustee has a perfected
security interest in the specified
vehicles and may not have a perfected
security interest in any cash
collections of the specified leases and
specified vehicles held by the
administrative agent at the time that a
bankruptcy proceeding begins.
FOR A DISCUSSION OF HOW A BANKRUPTCY
PROCEEDING OF THE ADMINISTRATIVE AGENT, THE
TRANSFEROR OR CERTAIN RELATED ENTITIES MAY
AFFECT THE TRUST AND THE SENIOR NOTES, SEE
"CERTAIN LEGAL ASPECTS OF THE ORIGINATION
TRUST AND THE SUBIs--INSOLVENCY RELATED
MATTERS".
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<PAGE> 19
IF ERISA LIENS ARE PLACED ON
THE ASSETS OF THE TRUST, YOU
COULD SUFFER A LOSS ON YOUR
INVESTMENT. o Liens in favor of the Pension Benefit
Guaranty Corporation could attach to the
specified leases and specified vehicles and
be used to satisfy unpaid ERISA obligations
of any member of a controlled group that
includes Ryder Truck Rental, Inc. and its
affiliates. These liens could have priority
over the interest of security holders in
SUBI assets, like the specified vehicles,
that are not covered by a prior perfected
security interest in favor of the indenture
trustee. The transferor believes that the
likelihood of this liability being asserted
against the assets of the trust or, if so
asserted, being successfully pursued, is
remote. However, you cannot be sure the
lease contracts and leased vehicles will
not become subject to an ERISA liability.
YEAR 2000 COMPUTER PROBLEMS
COULD DELAY OR LIMIT PAYMENTS
TO YOU. o Many computers and computer chips were not
programmed to recognize more than two
digits in the year of a given date. As a
result, in the year 2000, those computers
will not know whether an "00" refers to the
year 1900 or the year 2000. To the extent
that computer systems of the administrative
agent, maintenance provider, indenture
trustee or any parties that they rely on
continue to have these problems in the year
2000 and later, you could experience delays
in payments due to you or may not
ultimately receive all interest and
principal due to you. In addition, if
lessees under the specified leases
experience computer problems in the year
2000 or later, they may default or make
late payments under the specified leases.
As a result, you could experience delays in
payments due to you or may not ultimately
receive all principal and interest due to
you.
FOR A DISCUSSION OF RYDER'S YEAR 2000
PREPARATIONS BY AND HOW THEY MAY AFFECT THE
TRUST AND THE SENIOR NOTES, SEE
"RYDER--YEAR 2000 PREPARATIONS".
A CHANGE OR WITHDRAWAL BY
THE RATING AGENCIES OF THEIR
INITIAL RATINGS MAY REDUCE THE
MARKET VALUE OF THE SENIOR
NOTES. o A security rating is not a recommendation
by a rating agency that you buy, sell or
hold securities. Similar ratings on
different types of securities do not
necessarily mean the same thing. You are
encouraged to analyze the significance of
each rating independently from any other
rating. Any rating agency may change its
rating of the senior notes after the senior
notes are issued if that rating
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<PAGE> 20
agency believes that circumstances have
changed. A rating downgrade may reduce the
price that a subsequent purchaser will be
willing to pay for the senior notes.
IF THE TRUST IS REQUIRED TO SELL
ITS ASSETS, YOU MAY SUFFER A
LOSS ON YOUR INVESTMENT. o If the transferor becomes bankrupt or
insolvent, the trust will be dissolved and
the indenture trustee will be required to
sell the assets of the trust, including the
SUBI certificates, on commercially
reasonable terms. Because the bankruptcy of
the transferor will also require the
origination trust to be terminated with
respect to holding the SUBI assets, the
SUBI assets will be distributed to the
purchaser of the trust's assets and the
specified vehicles will be retitled at the
direction of that purchaser. The indenture
trustee will distribute the proceeds from
the sale of the trust's assets and monies
on deposit in the reserve fund, after the
payment of certain unpaid fees and
reimbursement of outstanding advances,
first to the senior note holders for
interest due, second to the reserve fund
for interest due on the subordinated notes,
third to the certificate holders for
interest due, fourth pro rata to each class
of senior note holders based on their
class' note balances until the senior notes
have been paid in full, and fifth to the
certificate holders and the subordinated
note holders ratably -- with amounts due on
the subordinated notes being paid to the
reserve fund. If these proceeds and amounts
are not sufficient to pay the senior notes
in full, you would incur a loss on your
investment.
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<PAGE> 21
THE FAILURE TO MAKE PRINCIPAL
PAYMENTS ON THE NOTES WILL
GENERALLY NOT RESULT IN AN
EVENT OF DEFAULT. o You should be aware that the amount of
principal required to be paid to you prior
to the final scheduled payment date for a
class of senior notes generally will be
limited to amounts available for those
purposes. Therefore, the failure to repay
principal of a class of senior notes
generally will not result in the occurrence
of an event of default under the indenture
until the final scheduled payment date for
the class of notes.
THE SENIOR NOTES ARE NOT
SUITABLE INVESTMENTS FOR ALL
INVESTORS. o The senior notes are not a suitable
investment if you require a regular
predictable schedule of payments. The
senior notes are complex investments that
should be considered only by investors who,
either alone or with their financial, tax
and legal advisors, have the expertise to
analyze prepayment, reinvestment, default
and market risk, the tax consequences of an
investment, and the interaction of these
factors.
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<PAGE> 22
OVERVIEW OF THE TRANSACTION
PLEASE REFER TO PAGE 4 FOR A DIAGRAM PROVIDING AN OVERVIEW OF THE
TRANSACTION DESCRIBED IN THIS PROSPECTUS. YOU CAN FIND A LISTING OF THE PAGES
WHERE CAPITALIZED TERMS USED IN THIS PROSPECTUS ARE DEFINED UNDER THE CAPTION
"INDEX OF CAPITALIZED TERMS" BEGINNING ON PAGE [131].
Ryder Truck Rental, Inc. ("Ryder") has assigned, and will assign,
full-service commercial truck, tractor and trailer leases and the related
vehicles to Ryder Truck Rental LT, a Delaware business trust (the "Origination
Trust"). The Origination Trust was created in July 1997 to facilitate the
titling of trucks, tractors and trailers in connection with the securitization
of truck, tractor and trailer leases. The Origination Trust has issued to Ryder
Truck Rental I LP ("RTR I LP") and Ryder Truck Rental II LP ("RTR II LP" and,
together with RTR I LP, the "UTI Beneficiaries") a 99% and a 1% beneficial
interest, respectively, in the undivided trust interest (the "UTI"). The UTI
represents the entire beneficial interest in assets of the Origination Trust
that have not been allocated to special units of beneficial interest such as the
one described in this prospectus. The trustee of the Origination Trust will be
directed by the UTI Beneficiaries:
o to establish two special units of beneficial interest (each a
"1999-A SUBI," and collectively, the "SUBIs");
o to allocate a separate portfolio of leases and some related assets
of the Origination Trust (the "Specified Leases") to one 1999-A SUBI
(the "Lease SUBI"); and
o to allocate the vehicles that are leased under the Specified Leases
and some other related assets of the Origination Trust (the
"Specified Vehicles") to the other 1999-A SUBI (the "Vehicle SUBI").
The SUBIs will represent the entire beneficial interest in the Specified Leases
and Specified Vehicles (collectively, the "SUBI Assets"). RTR I LP and RTR II LP
will respectively be issued 99% and 1% interests in each 1999-A SUBI. Upon
creation of each 1999-A SUBI, the related SUBI Assets will no longer be a part
of the Origination Trust Assets represented by the UTI, and the interest in the
Origination Trust Assets represented by the UTI will be reduced accordingly.
Each 1999-A SUBI will evidence an indirect beneficial interest, rather than a
direct legal interest, in the related SUBI Assets. Each 1999-A SUBI will not
represent a beneficial interest in any Origination Trust Assets other than the
related SUBI Assets. Payments made on or in respect of any Origination Trust
Assets other than the SUBI Assets will not be available to make payments on the
Senior Notes. The UTI Beneficiaries may from time to time cause special units of
beneficial interest other than the SUBIs (each, an "Other SUBI") to be created
out of the UTI. The Trust (and, accordingly, the Senior Noteholders) will have
no interest in the UTI, any Other SUBI or any assets of the Origination Trust
Assets evidenced by the UTI or any Other SUBI. See "The SUBIs" and "The
Origination Trust".
RTR I LP will sell, transfer and assign its 99% interest each 1999-A
SUBI (collectively, the "SUBI Interest") to Ryder Funding LP (the "Transferor").
The Transferor will in turn (a) transfer and assign the certificate representing
its 99% interest in the Vehicle SUBI (the "Vehicle SUBI Certificate") to Ryder
Vehicle Lease Trust 1999-A (the "Trust"), and (b) pledge the certificate
representing its 99% interest in the Lease SUBI (the "Lease SUBI Certificate",
and together with the Vehicle SUBI Certificate, the "SUBI Certificates") to the
Trust. RTR II LP will permanently retain the 1% beneficial interest in the SUBI
Assets not represented by the SUBI Certificates (the "Retained SUBI Interest").
The Trust will issue four classes of senior notes (the "Senior Notes") in an
aggregate principal amount of $__________ (the "Initial Senior
21
<PAGE> 23
Note Balance") and will pledge the Vehicle SUBI Certificate and its interest in
the Lease SUBI Certificate to the Indenture Trustee as security therefor. The
Trust will also issue one class of ___% asset backed subordinated notes (the
"Subordinated Notes," and together with the Senior Notes, the "Notes") in an
aggregate principal amount of $________ (the "Initial Subordinated Note
Balance") and one class of asset backed certificates (the "Certificates") in an
aggregate principal amount of $__________ (the "Initial Certificate Balance").
The Senior Notes, the Subordinated Notes and the Certificates are collectively
referred to in this prospectus as the "Securities" and the holders of those
Securities are referred to as "Securityholders". Each Note will represent an
obligation of, and for some non-tax purposes, each Certificate will represent a
fractional undivided interest in, the Trust. Payments in respect of the
Subordinated Notes and the Certificates will be subordinated to payments in
respect of the Senior Notes to the extent described in this prospectus. The
Subordinated Notes and the Certificates are not being offered to you in this
offering.
On the date of initial issuance of the Securities (the "Closing Date"),
the Trust and the Transferor will enter into a program operating lease (the
"Program Operating Lease") under which the Trust will lease the Vehicle SUBI
Certificate, subject to the lien of the Indenture, to the Transferor in exchange
for the obligation of the Transferor to make certain payments during the period
that each underlying Specified Vehicle is covered by the Program Operating
Lease. The Trust will apply these payments, together with proceeds received from
certain sales of Specified Vehicles, to pay interest on and principal of the
Securities.
As a condition to the issuance of the Senior Notes, Moody's Investors
Service, Inc. and Duff & Phelps Credit Rating Co. (each, a "Rating Agency"),
must each rate the Senior Notes in their highest rating category. See "Ratings
of the Securities" for further information concerning the ratings assigned to
the Senior Notes, including the limitations of such ratings.
THE TRUST
FORMATION
The Trust will be formed under the laws of the State of Delaware solely
for the purposes of the transactions described in this prospectus. The trust
will be governed by an amended and restated trust agreement, dated as of
October 1, 1999 (the "Trust Agreement") between the Transferor and Chase
Manhattan Bank Delaware, as Owner Trustee.
The Trust will issue the Senior Notes under an indenture dated as of
October 1, 1999, between the Trust and U.S. Bank National Association, as
trustee (in that capacity, the "Indenture Trustee"). The Subordinated Notes and
the Certificates will be issued under the Trust Agreement.
The Trust will not engage in any activity other than as duly authorized
in accordance with the terms of the Trust Agreement. On the Closing Date, the
authorized purposes of the Trust will be limited to:
o issuing the Securities;
o acquiring the Vehicle SUBI Certificate and the other property of the
Trust Estate with the proceeds from the sale of the Securities;
o assigning and pledging the Trust Estate to the Indenture Trustee
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<PAGE> 24
o leasing the Vehicle SUBI Certificate to the Transferor;
o making payments on the Securities;
o entering into and performing its obligations under the Basic
Documents to which it is a party; and
o engaging in other transactions, including entering into agreements,
that are necessary, suitable or convenient to accomplish, or that
are incidental to or connected with, any of the foregoing
activities.
Approval of additional Trust activities and purposes may be requested by holders
of at least 75% of the outstanding balance of the Certificates and will require
(a) that each Rating Agency have delivered a letter to the effect that the
activities and purposes would not cause its then-current ratings of the Senior
Notes or the Certificates to be qualified, reduced or withdrawn, and (b)
approval by holders of at least 75% of the outstanding balance of the Senior
Notes, or if the Senior Notes are no longer outstanding, by the Subordinated
Noteholder.
Under an administration agreement (the "Trust Administration
Agreement"), Ryder, as administrator (the "Administrator"), will perform the
Trust's administrative obligations under the Trust Agreement and the Indenture.
The Trust's principal offices will be in Wilmington, Delaware, in care
of the Owner Trustee, at the address listed below under "The Owner Trustee".
CAPITALIZATION
On the Closing Date, the Trust will be capitalized with $____________
aggregate principal amount of Securities. The Trust will sell the Senior Notes
and the Certificates other than the Transferor Certificate to third party
investors that are expected to be unaffiliated with the Transferor, the
Administrative Agent or their respective affiliates. In exchange for the
transfer of the Vehicle SUBI Certificate, the Trust will pay the Transferor the
net proceeds from the sale of the Senior Notes and the Certificates, and will
issue to the Transferor the Subordinated Notes and a Certificate with a
$________ principal balance, which will approximately equal to 1% of the Initial
Certificate Balance (the "Transferor Certificate"). The following table
illustrates the capitalization of the Trust as of the Closing Date, as if the
issuance and sale of the Securities had taken place on that date:
Senior Notes................................. $
Subordinated Notes...........................
Certificates.................................
Transferor Certificate.......................
------------
Total................................... $
============
THE OWNER TRUSTEE
Chase Manhattan Bank Delaware will be the trustee (the "Owner Trustee")
under the Trust Agreement. Chase Manhattan Bank Delaware is a Delaware banking
corporation, and its Corporate Trust Office is located at 1201 Market Street,
Wilmington, Delaware 19801. The Transferor, the Administrative Agent and their
affiliates may maintain normal commercial
23
<PAGE> 25
banking relationships with the Owner Trustee and its affiliates. The fees and
expenses of the Owner Trustee will be paid by the Administrator. See "Additional
Document Provisions--Miscellaneous Provisions--Fees and Expenses".
PROPERTY OF THE TRUST
On the Closing Date, the Transferor will transfer the Vehicle SUBI
Certificate to the Trust pursuant to the Issuer SUBI Certificate Transfer
Agreement and will pledge the Lease SUBI Certificate to the Trust pursuant to
the Program Operating Lease. The Trust will then pledge its interest in each
SUBI Certificate to the Indenture Trustee under the Indenture and then, subject
to that pledge, will lease the Vehicle SUBI Certificate to the Transferor
pursuant to the Program Operating Lease. See "The SUBIs--Transfers of the SUBI
Certificates".
After giving effect to the transactions described in this prospectus,
the property of the Trust (the "Trust Estate") generally will include:
o the Vehicle SUBI Certificate, evidencing a 99% beneficial interest
in the assets allocated to the Vehicle SUBI (the "Vehicle SUBI
Assets"), including the right to payments thereunder from certain
Sales Proceeds on deposit in the SUBI Collection Account and the
Residual Value Surplus Account and investment earnings, net of
losses and investment expenses, on amounts on deposit in the SUBI
Collection Account and the Residual Value Surplus Account;
o the rights of the Trust under the Program Operating Lease;
o the rights of the Trust as pledgee of the Lease SUBI Certificate;
o the rights of the Trust as secured party under a back-up security
agreement with respect to the SUBI Certificates and the 99%
undivided interest in other SUBI Assets;
o the rights of the Trust to funds on deposit from time to time in the
Note Distribution Account and any other account or accounts
established pursuant to the Indenture;
o the rights of the Transferor, as transferee, under the SUBI
Certificate Transfer Agreement;
o the rights of the Trust, as transferee, under the Issuer SUBI
Certificate Transfer Agreement;
o the rights of the Trust as a third-party beneficiary under the
Administration Agreement, including rights to certain Advances, and
the SUBI Trust Agreement;
o the security interest of the Trust in the Subordinated Notes and the
Reserve Fund (including investment earnings, net of losses and
investment expenses, on amounts on deposit therein); and
o all proceeds of the foregoing.
The Indenture will require the Trust Estate to be pledged by the Trust to the
Indenture Trustee.
Because the SUBI will represent a beneficial interest in the SUBI
Assets, Senior Noteholders will be dependent on payments made on the Specified
Leases and proceeds received in connection with the sale or other disposition of
Specified Vehicles for the payment of interest on and principal of the Senior
Notes. The Trust will not have a direct ownership interest in the Specified
Leases or a direct ownership interest or perfected security interest in the
Specified
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<PAGE> 26
Vehicles - which will be titled in the name of the Origination Trust or the
Origination Trustee on behalf of the Origination Trust - and it is therefore
possible that a claim or lien in respect of the Specified Vehicles or the
Origination Trust could limit the amounts payable in respect of the SUBI
Certificates to less than the amounts received from the lessees of the Specified
Vehicles (each, an "Obligor") or received from the sale or other disposition of
Specified Vehicles. To the extent that a claim or lien were to delay the
disposition of the Specified Vehicles or reduce the amount paid to the holders
of the SUBI Certificates in respect of their beneficial interests in the SUBI
Assets, Senior Noteholders could experience delays in payment or losses on their
investment. See "Risk Factors--A bankruptcy of the transferor or the
administrative agent could delay or limit payments on the senior notes", "The
SUBIs", "Certain Legal Aspects of the Origination Trust and the SUBIs--The
SUBIs" and "Certain Legal Aspects of the Specified Leases and the Specified
Vehicles--Back-up Security Interests".
USE OF PROCEEDS
The net proceeds from the sale of the Senior Notes -- the proceeds of
the public offering minus expenses relating thereto -- together with the
proceeds from the issuance of the Subordinated Notes and the Certificates, will
be applied by the Trust to acquire the Vehicle SUBI Certificate and the pledge
of the Lease SUBI Certificate.
THE ORIGINATION TRUST
GENERAL
The Origination Trust is a Delaware business trust and is governed by
an amended and restated trust agreement dated as of February 1, 1998 (the
"Origination Trust Agreement"), among the UTI Beneficiaries, the Administrative
Agent, RTRT, Inc., as Trustee (the "Origination Trustee"), Delaware Trust
Capital Management, Inc. and U.S. Bank National Association ("U.S. Bank"), as
trust agent (in that capacity, the "Trust Agent"). The assets of the Origination
Trust (the "Origination Trust Assets") consist of:
o full service operating leases (the "Leases") assigned to the
Origination Trust by Ryder;
o the commercial trucks, tractors and trailers leased under those
Leases (the "Vehicles"); and
o certain payments under the Leases, proceeds from sales of the
Vehicles, and other assets more fully described below.
The primary business purpose of the Origination Trust is to take assignments of,
and serve as record holder of title to, the Leases and Vehicles, in order to
facilitate the titling of the Vehicles in connection with asset backed
securities issuance transactions.
Under an administration agreement dated as of February 1, 1998, as
amended by a supplement to be dated as of October 1, 1999 (as amended or
supplemented from time to time, the "Administration Agreement") among the
Origination Trust, RTR I LP and RTR II LP, as UTI Beneficiaries and, Ryder, as
administrative agent (in that capacity, the "Administrative Agent"), Ryder will
service the Leases, including the Specified Leases, and, as maintenance provider
(in that capacity, the "Maintenance Provider"), will provide specified services
and maintenance in respect of the Vehicles, including the Specified Vehicles.
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Except as otherwise described under "Additional Document
Provisions--The SUBI Trust Agreement," under the Origination Trust Agreement,
the Origination Trust has not and will not:
o issue interests or securities other than the SUBI Interest and the
Retained SUBI Interest, the SUBI Certificates, the Retained SUBI
Certificates, Other SUBIs, one or more certificates representing
each Other SUBI (the "Other SUBI Certificates"), the UTI and one or
more certificates representing the UTI (the "UTI Certificates");
o borrow money, except from Ryder or the UTI Beneficiaries in
connection with funds used to acquire Leases and Vehicles;
o make loans;
o invest in or underwrite securities;
o offer securities in exchange for Origination Trust Assets, with the
exception of the SUBI Certificates, the Retained SUBI Certificates,
Other SUBI Certificates and the UTI Certificates;
o repurchase or otherwise reacquire its securities, other than for
purposes of cancellation, except as permitted by or in connection
with financing or refinancing the acquisition of Leases and Vehicles
or as otherwise permitted by each such financing or refinancing; or
o grant any security interest in or lien on any Origination Trust
Assets.
For further information regarding the Origination Trust, the servicing of the
Leases and the provision of services and maintenance in respect of the
Vehicles, see "Additional Document Provisions--The SUBI Trust Agreement" and
"--The Administration Agreement".
THE UTI BENEFICIARIES
RTR I LP and RTR II LP are the UTI Beneficiaries under the Origination
Trust Agreement. The sole general partners of RTR I LP and RTR II LP are Ryder
Truck Rental I LLC ("RTR I LLC") and Ryder Truck Rental II LLC ("RTR II LLC"),
respectively, each a Delaware limited liability company. Ryder is the sole
limited partner of each of the UTI Beneficiaries. The UTI Beneficiaries were
formed as limited partnerships under the laws of Delaware in June 1997 for the
sole purpose of being initial beneficiaries of the Origination Trust, holding
the UTI and the UTI Certificates, acquiring interests in the SUBI and Other
SUBIs and engaging in related transactions. The limited liability company
operating agreements of each of RTR I LLC and RTR II LLC and the limited
partnership agreements of each UTI Beneficiary limit their respective activities
to the foregoing purposes and to any activities incidental thereto or necessary
therefor. So long as any financings involving interests in the Origination
Trust, including the transaction described in this prospectus, are outstanding,
neither RTR I LLC nor RTR II LLC may transfer its general partnership interest
in the related UTI Beneficiary. The principal offices of RTR I LP and RTR II LP
are located at 3600 N.W. 82nd Avenue, Miami, Florida 33166 and their telephone
number is (305) 500-3726.
THE ORIGINATION TRUSTEE
The Origination Trustee is a wholly owned special purpose subsidiary of
U.S. Bank and was incorporated in June 1997 for the sole purpose of acting as
Origination Trustee. The Origination Trustee is not affiliated with Ryder or any
of its affiliates. U.S. Bank, as Trust Agent, serves as agent for the
Origination Trustee to perform some functions of the Origination
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Trustee under the Origination Trust Agreement. Under the Origination Trust
Agreement, if U.S. Bank can no longer act as the Trust Agent, the designees of
the UTI Beneficiaries which may not be either UTI Beneficiary or any of their
affiliates -- will have the option to purchase the stock of the Origination
Trustee for a nominal amount. If the UTI Beneficiaries do not timely exercise
that option, the Origination Trustee will appoint a new trust agent which will
have the option to purchase the stock of the Origination Trustee. If none of
these options is timely exercised, U.S. Bank may sell the stock of the
Origination Trustee to another party.
PROPERTY OF THE ORIGINATION TRUST
The Origination Trust Assets generally consist of:
o Leases originated by Ryder and all monies due from Obligors
thereunder;
o Vehicles and all proceeds of those Vehicles;
o all of Ryder's rights with respect to those Leases and Vehicles;
o the rights to proceeds from any physical damage, liability or other
insurance policies, if any, covering the Leases or the related
Obligors or the Vehicles, including but not limited to the
Contingent and Excess Liability Insurance; and
o all proceeds of the foregoing.
From time to time after the date of this prospectus, Ryder will assign
additional Leases to the Origination Trust and, as described below, title the
related Vehicles in the name of the Origination Trust or the Origination Trustee
on behalf of the Origination Trust.
LEASE ORIGINATION AND THE TITLING OF VEHICLES
All Leases have been or will be underwritten using the underwriting
criteria described under "Ryder--Lease Underwriting Procedures". Under each
Lease, the Origination Trust, or the Origination Trustee on behalf of the
Origination Trust, will be listed as the owner of the related Vehicle on the
Vehicle's certificate of title. Liens will not be placed on the certificates of
title, nor will new certificates of title be issued, to reflect the interest of
the Trust, as holder of the Vehicle SUBI Certificate, in the Specified Vehicles.
After the sale of the Vehicle SUBI Certificate to the Trust, the
Administrative Agent will be obligated to repurchase any Vehicles covered by
Leases not meeting certain representations and warranties of the Administrative
Agent by making Reallocation Payments in respect thereof. Those representations
and warranties relate primarily to the origination of the Leases, and do not
typically relate to the creditworthiness of the related Obligors or the
collectibility of the Leases.
All of the Specified Vehicles will either be titled in the name of the
Origination Trust or the Origination Trustee on behalf of the Origination Trust
by the Closing Date, or will be titled in the name of Ryder but will be
re-titled into the name of the Origination Trust or the Origination Trustee on
behalf of the Origination Trust within 60 days after the Closing Date (the
"Titling Grace Period"). Specified Vehicles relating to Specified Leases having
an aggregate Cutoff Date Securitization Value of $____________ will be titled in
the name of the Origination Trust or the Origination Trustee on behalf of the
Origination Trust by the Closing Date. Specified Vehicles relating to Specified
Leases having an aggregate Cutoff Date Securitization Value not to exceed
$____________ will be titled in the name of the Origination Trust or the
Origination Trustee on behalf of the Origination Trust during the Titling Grace
Period. If the Administrative Agent fails
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to properly retitle any Titling Grace Period Vehicle, it will be required to
make a payment equal to the Securitization Value of the related Specified Lease
as of the last day of the Titling Grace Period. See "Risk Factors--During a
titling grace period the origination trust will lack a perfected ownership
interest in some vehicles". Other Leases and Vehicles will also to be assigned
to the Origination Trust after the Closing Date but will not constitute
Specified Leases or Specified Vehicles.
All Vehicles owned by the Origination Trust will be held for the
benefit of entities that from time to time hold beneficial interests in the
Origination Trust. Those interests will be evidenced with respect to:
o Leases and Vehicles not allocated to the 1999-A SUBIs or an Other
SUBI, by the UTI,
o the Specified Leases and the Specified Vehicles, by the 1999-A
SUBIs, or
o Leases and Vehicles financed in another transaction, by an Other
SUBI.
Entities holding beneficial interests in the Origination Trust will not have a
direct ownership in the related Leases or a direct ownership or perfected
security interest in the related Vehicles.
The certificates of title for the Specified Vehicles will not reflect
the indirect interest of the Trust in the Specified Vehicles by virtue of its
beneficial interest in the Vehicle SUBI Assets. Therefore, if the Senior Notes
were recharacterized as secured loans, the Trust would not have a perfected lien
in the Specified Vehicles, but will have filed a financing statement to perfect
the security interest in the Vehicle SUBI Assets, but only to the extent that
the security interest may be perfected by filing under the UCC. For further
information regarding the titling of the Specified Vehicles and the interest of
the Trust therein, see "Certain Legal Aspects of the Specified Leases and the
Specified Vehicles--Back-up Security Interests".
THE SUBIs
GENERAL
Each 1999-A SUBI will be issued by the Origination Trust under a
supplement to be dated as of October 1, 1999 (the "SUBI Supplement" and,
together with the Origination Trust Agreement, the "SUBI Trust Agreement") to
the Origination Trust Agreement. The 1999-A SUBIs will not represent a direct
interest in the SUBI Assets or an interest in any Origination Trust Assets other
than the related SUBI Assets. The Trust and the Senior Noteholders will have no
interest in the UTI, any Other SUBI or any assets of the Origination Trust
evidenced by the UTI or any Other SUBI. Payments made on or in respect of
Origination Trust Assets not represented by the SUBIs will not be available to
make payments on the Senior Notes. For further information regarding the
Origination Trust, see "The Origination Trust".
The Lease SUBI Certificate will evidence a beneficial interest in the
assets allocated to the Lease SUBI (the "Lease SUBI Assets"), which will
generally consist of the Specified Leases and all proceeds of or payments on
those leases received or due on or after October 1, 1999 (the "Cutoff Date") and
all other related Lease SUBI Assets, including:
o amounts in the SUBI Collection Account received in respect of the
Specified Leases,
o certain monies due under or payable in respect of the Specified
Leases on or after the Cutoff Date, including the right to receive
payments made to Ryder, the Transferor, the Origination Trust, the
Origination Trustee or the Administrative Agent under any insurance
policy relating to the Specified Leases or the related Obligors, and
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o all proceeds of the foregoing.
The Vehicle SUBI Certificate will evidence a beneficial interest in the
Vehicle SUBI Assets, which will generally consist of the Specified Vehicles and
all proceeds of or payments on those vehicles received or due on or after the
Cutoff Date and all other related Vehicle SUBI Assets, including:
o amounts in the SUBI Collection Account received in respect of the
sale of the Specified Vehicles and the Residual Value Surplus
Account,
o certain monies due under or payable in respect of the Specified
Vehicles on or after the Cutoff Date, including the right to receive
payments made to Ryder, the Transferor, the Origination Trust, the
Origination Trustee or the Administrative Agent under any insurance
policies related to the Specified Vehicles, and
o all proceeds of the foregoing.
On the Closing Date the Origination Trust will issue (a) the SUBI
Certificates, evidencing the SUBI Interest, to RTR I LP and (b) certificates
evidencing the Retained SUBI Interest (the "Retained SUBI Certificates"), to RTR
II LP. RTR II LP will permanently retain the Retained SUBI Certificates and will
be entitled to receive 1% of all payments made on or in respect of the SUBI
Assets and will share in 1% of all losses and liabilities incurred with respect
to the SUBI Assets. Accordingly, payments made in respect of the Retained SUBI
Certificates will not be available to make payments on the Senior Notes.
TRANSFERS OF THE SUBI CERTIFICATES
Simultaneously with the issuance of the SUBI Certificates to RTR I LP,
RTR I LP will convey the SUBI Certificates to the Transferor pursuant to a
transfer agreement to be dated as of October 1, 1999 (the "SUBI Certificate
Transfer Agreement"). RTR I LP will covenant to treat the conveyance of the SUBI
Certificates to the Transferor as an absolute sale, transfer and assignment for
all purposes.
Immediately after the transfer of the SUBI Certificates to the Transferor, the
Transferor will:
o transfer to the Trust, without recourse, all of its right, title and
interest in and to the Vehicle SUBI Certificate and the SUBI
Interest it represents under a transfer agreement dated as of
October 1, 1999 (the "Issuer SUBI Certificate Transfer Agreement");
o deliver the Vehicle SUBI Certificate to the Trust;
o pledge the Lease SUBI Certificate, and the SUBI Interest it
represents, to the Trust under the Program Operating Lease as
security for the obligations of the Transferor under the Program
Operating Lease; and
o deliver the Lease SUBI Certificate to the Trust to perfect the
pledge.
In exchange, the Trust will pay to the Transferor the net proceeds from the sale
of the Senior Notes and Certificates to third party investors, and will issue to
the Transferor the Subordinated Notes and the Transferor Certificate.
Immediately following the transfer of the Vehicle SUBI Certificate and
the pledge of the Lease SUBI Certificate to the Trust, the Trust will pledge its
interest in the Trust Estate, which includes the Vehicle SUBI Certificate and
the pledge of the Lease SUBI Certificate, to the Indenture Trustee as security
for the Senior Notes. The Trust and the Transferor will then enter
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into the Program Operating Lease, under which the Trust will lease the Vehicle
SUBI Certificate to the Transferor, subject to the pledge thereof to the
Indenture Trustee. During the term of the Program Operating Lease, the
Transferor, as lessee of the Vehicle SUBI Certificate, will be required to make
Program Operating Lease Payments to the Trust and will be entitled to receive
proceeds from the Vehicle SUBI Certificate - as well as from the Lease SUBI
Certificate - in respect of the Specified Vehicles to the extent described under
"Security for the Securities--The Program Operating Lease".
THE TRANSFEROR
The Transferor is a limited partnership that was formed under the laws
of Delaware in May 1998. The sole general partner of the Transferor is Ryder
Truck Rental III LLC ("RTR III LLC"), a Delaware limited liability company. RTR
III LLC may not transfer its general partnership interest in the Transferor so
long as any financings involving interests held by the Transferor at any time in
the Origination Trust, including the transaction described in this prospectus,
are outstanding. Ryder is the sole limited partner of the Transferor. The
principal office of the Transferor is located at 3600 N.W. 82nd Avenue, Miami,
Florida 33166 and its telephone number is (305) 500-3726.
The Transferor and RTR III LLC were organized solely for the purpose of
acquiring interests in the UTI, the SUBIs and Other SUBIs, causing securities
like as the Senior Notes to be issued, and engaging in related transactions. The
limited partnership agreement of the Transferor and the limited liability
company agreement of RTR III LLC limit their respective activities to those
purposes and to any activities incidental or necessary thereto.
RYDER
GENERAL
All of the Leases, including the Specified Leases, have been originated
by Ryder in the ordinary course of its leasing business using the underwriting
criteria described under "Ryder--Lease Underwriting Procedures". Additionally,
Ryder, as the Administrative Agent, will service the Leases, including the
Specified Leases, and, as and Maintenance Provider, will provide specified
services and maintenance in respect of the Vehicles, including the Specified
Vehicles.
Ryder is a Florida corporation that was incorporated in 1953. Ryder
provides full service truck leasing to about 13,000 commercial customers ranging
from large national enterprises to small companies. As of December 31, 1998,
Ryder had a fleet of 109,124 vehicles -- including 14,751 vehicles leased to
affiliates -- leased or rented through 894 locations in 48 states, Puerto Rico,
and 8 Canadian provinces. Under a full service lease, Ryder provides its
customers with vehicles, maintenance, supplies and related equipment necessary
for operation, while its customers furnish and supervise their own drivers, and
dispatch and exercise control over the related vehicles. Additionally, as of
December 31, 1998, Ryder provided contract maintenance services to more than
1,500 customers, serviced 44,856 vehicles -- including approximately 9,560
vehicles owned by affiliates -- under maintenance contracts. Ryder also provided
short-term truck rental, which tends to be seasonal, to commercial customers to
supplement their fleets during peak business periods. As of December 31, 1998,
Ryder had a fleet of 37,517 vehicles, ranging from heavy-duty tractors and
trailers to light-duty trucks, available for commercial short-term rental.
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Ryder is a wholly owned subsidiary of Ryder System, Inc. ("Ryder
System"). Ryder System is a publicly held Florida corporation that was
incorporated in 1955. Through its subsidiaries, Ryder System engages primarily
in the following businesses:
o full service leasing, maintenance and short-term commercial rental
of trucks, tractors and trailers; and
o integrated logistics, including dedicated contract carriage, the
management of carriers and inventory deployment.
Ryder System's common stock, which is listed and traded on the New York
Stock Exchange under the symbol "R", is a component of both the Dow Jones
Transportation Average and the Standard & Poor's 500 Index. At December 31,
1998, Ryder System and its subsidiaries had a fleet of 173,116 vehicles and
45,373 employees.
Further information regarding Ryder System and its subsidiaries,
including Ryder, is available in the periodic reports Ryder System files with
the Commission. For the location of the Commission's reference locations and
internet address at which such information is available see "Available
Information".
SHARED SERVICES CENTER
Ryder has consolidated most financial administrative functions,
including collections and underwriting, into its Shared Services Center, a
centralized processing center located in Alpharetta, Georgia. This change is
intended to result in more efficient and consistent centralized processing of
selected administrative operations. The Shared Service Center was developed to:
o reduce on-going annual administrative costs;
o enhance customer service through process standardization;
o create an organizational structure that will improve market
flexibility; and
o allow future reengineering efforts to be more easily attained at
lower implementation costs.
The transfer of functions to the Shared Service Center was completed in December
1997.
THE LEASES
USE AND NATURE OF THE VEHICLES
Ryder furnishes commercial trucks, highway-tractors and trailers to a
wide range of customers under full service operating leases with terms running
typically five or six years. Full service leasing is Ryder's and Ryder System's
largest product line, with about 13,000 customers and approximately 109,000
vehicles on lease in the United States and Canada. The leased vehicles may be
generically configured or they may be specialized units with refrigeration
systems or other application-specific equipment.
Ryder purchases trucks and highway-tractors from manufacturers such as
Navistar/International, Freightliner, Mack, Volvo and Isuzu, and trailers from
manufacturers such as Utility and Stoughton. Ryder also specifies many of the
components used by those
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vehicle vendors. Ryder purchases such components from various manufacturers,
including Cummins engines, Bridgestone tires, Meritor Automotive clutches,
transmissions, axles, brakes and drivelines, ASF Castloc fifth wheels, Kysor fan
clutches, Bendix valves and Accuride wheels.
Full-service truck leases are designed for customers who wish to manage
their own transportation systems without investing the capital and human
resources necessary to purchase and maintain a fleet. Ryder offers its customers
a flexible range of full-service truck leasing products and virtually all of the
support services needed to operate them, including safety and regulatory
compliance programs, vehicle specification and acquisition support, preventive
maintenance, licensing and permitting, emergency road service, fuel and fuel tax
reporting, vehicle painting and washing and vehicle liability and protection
programs. Companies in a variety of industries, such as the beverage, baking and
snack, newspaper, grocery, chemicals, retail and automotive aftermarket parts
industries, lease their trucks from Ryder.
TRUCK LEASE AND SERVICE AGREEMENT
Ryder's Truck Lease and Service Agreement (each, a "TLSA") is a
contract between Ryder, and an Obligor, that, when taken together with the lease
schedule for a Vehicle (each, a "Schedule A" and, together with a TLSA, a
"Lease"), requires the Obligor to make Total Monthly Payments for a
predetermined number of months in exchange for the use of one or more Vehicles.
In addition to use of the Vehicle, to the extent set forth in the related Lease,
the Obligor will also be entitled to receive other services related to that
Vehicle. Maintenance and mechanical repair of the Vehicle by Ryder, however, is
almost always included. The terms of a Lease do not separate the payment for
Vehicle use from the payment for maintenance and other goods and services within
the Total Monthly Payment. See "--Lease Payments". At the scheduled maturity or
other termination of a Lease (the "Maturity Date"), the Obligor must return the
related Vehicle to Ryder at a specified maintenance facility and must restore
the Vehicle to its original condition, if any structural alterations have been
made by the Obligor.
The TLSA is a form of master lease that describes the general terms of
the Lease and the respective rights and obligations of Ryder and the Obligor.
These terms, unless amended, apply to all Vehicles leased under a TLSA. Every
Schedule A describes each particular Vehicle being leased, its Fixed Charge, the
term of its lease (the "Lease Term") and the depreciation schedule and other
specific terms of the Lease, including the party responsible for maintaining
liability insurance on the Vehicle and the party responsible for physical risk
of loss or damage to the Vehicle. The Schedule A also specifies each Vehicle's
domicile and the location of the maintenance facility where the Vehicle will be
routinely maintained and repaired.
A typical full-service operating Lease will provide for payments based
on, among other things, the original value of the Vehicle leased thereunder, the
amount of total depreciation over the Lease Term and the prorated cost of all
unexpired license fees, applicable taxes and other expenses prepaid by Ryder for
the Vehicle, as well as payments for various other goods and services Ryder
provides in connection with the Vehicle. Both the financial and service
commitments of the parties are covered by the Lease and, accordingly, both Ryder
and the Obligor have continuing performance obligations during the term of the
Lease. In connection with the origination of a Lease, Ryder modifies its
standard Lease in the ordinary course of its business to meet the requirements
of the related Obligor and all descriptions of a Lease contained in this
prospectus are of a typical or illustrative Lease. Modifications may affect,
among other
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things, the services provided, the payment terms, the allocation of risk and the
parties' respective rights and obligations upon termination or breach. A breach
of or default under a Lease may result in the termination of the Lease. The
termination may occur either (a) as part of the termination of a master lease,
thus effecting the termination of all Vehicles leased under the master lease
arrangement, or (b) only with respect to the specific Vehicle directly affected
by the breach or default.
MAINTENANCE AND SERVICES PROVIDED
A typical Lease may cover:
o maintenance and repair of the related Vehicles by Ryder at a
specified maintenance facility, including all labor and parts;
o exterior washing of the Vehicles;
o specification assistance, whereby Ryder will assist the Obligor in
formulating appropriate specifications based on the Obligor's
intended use of the Vehicles;
o supplying the Obligor with one or more substitute Vehicles (each, a
"Substitute Vehicle"), at no extra cost to the Obligor, if a
mechanical failure renders a Vehicle temporarily inoperable;
o emergency road service in the event that a Vehicle suffers
mechanical or tire failure;
o initial exterior painting and lettering, up to a specified
allowance, at the time the Vehicles are placed into service;
o licensing and payment of certain specified taxes, up to a specified
annual amount;
o enrollment of the Obligor in a Vehicle-related safety program;
o the provision of fuel, whether by Ryder or the Obligor;
o whether Ryder will extend its liability insurance to cover the
Obligor for the Vehicles and any Substitute Vehicles (the "Insured
Vehicles"); and
o whether Ryder or the Obligor assumes the risk of physical damage to
and theft and loss of the Vehicles or any Substitute Vehicles. See
"--Insurance".
A Lease may provide that Ryder will supply the Obligor with a
substitute vehicle at no extra cost if a mechanical failure renders a Vehicle
temporarily inoperable. The Fixed Charge on a Vehicle, more fully described
under "--Lease Payments", will continue to accrue on a Vehicle if the Vehicle is
out of service due to a temporary mechanical failure unless Ryder fails to
provide a Substitute Vehicle, in which event the Fixed Charge will not continue
to accrue until the Vehicle is repaired. Ryder will not provide a Substitute
Vehicle when:
o a Vehicle is out of service for the performance of scheduled
preventative maintenance;
o a Vehicle is out of service for the repair of physical damage, such
as that caused by collision, fire, vandalism or Act of God;
o a Vehicle is out of service because the Obligor has violated the
related Lease;
o a Vehicle has been stolen;
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o a Vehicle has been outfitted with special equipment or has otherwise
been customized for use by the Obligor; or
o special equipment, which Ryder is not contracted to maintain, is
being repaired.
If a Vehicle is out of service for the repair of physical damage, Ryder will
rent the related Obligor a replacement vehicle at a rental rate equal to the
lease rate on the related Lease; however, the Fixed Charge on the out of service
Vehicle will continue to accrue. Ryder may also rent Obligors additional
Vehicles for short-term use so that the Obligor can manage fluctuations in its
needs, and the rates therefor may be set forth in the related Lease.
Although Ryder may be responsible for providing fuel to the related
Vehicles under a Lease, the Lease will not include charges for any fuel so
provided. All fuel charges are separately billed to the Obligor on a monthly
basis. If Ryder is responsible for providing fuel, it obtains all applicable
fuel tax permits, prepares and files fuel tax returns and pays the taxes imposed
on the consumption of fuel, which amounts are billed to the Obligor. If the
Obligor provides fuel, then it performs those fuel tax permitting and reporting
functions and indemnifies Ryder for any liability for the failure to pay all
applicable fuel taxes.
VEHICLE OPERATING RULES
Under the terms and conditions applicable to each Lease of a Vehicle,
an Obligor must:
o operate the related Vehicles in the normal and ordinary course of
its business;
o comply with all federal, state and local laws and regulations;
o not use the Vehicles in a reckless or abusive manner;
o operate the Vehicles only within the United States or, occasionally,
Canada, and pay for all charges that accrue if a Vehicle is detained
outside of these countries;
o if the Obligor operates a Vehicle, such as a trailer, while it is
connected to a vehicle that Ryder does not maintain, maintain the
connected vehicle in good operating condition; and
o pay for all physical damage, repairs, maintenance and expenses
resulting from operation of a Vehicle in violation of any of the
Lease restrictions.
DRIVERS
Under a Lease, only properly licensed and qualified drivers under the
Obligor's exclusive direction and control are permitted to operate the Vehicles.
Ryder reserves the right to request in writing that the Obligor remove unsafe or
incompetent drivers based on their safety record, accident experience or
driver's license status. If Ryder asks an Obligor to remove a driver and the
Obligor fails to comply with that request, then any or all of the following may
apply:
o the Obligor must reimburse Ryder for any damages occurring while the
driver asked to be removed operates the Vehicle, even if Ryder
assumed responsibility for paying for physical damage to the
Vehicle,
o even if Ryder extended liability insurance to the Obligor, the
Obligor must defend, release, indemnify and hold harmless Ryder for
all damages and defense costs resulting from the driver's operation
of the Vehicle,
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o Ryder may cancel any liability insurance it extended to the Obligor
by providing the Obligor with 30 days' prior written notice, or
o Ryder may terminate any physical damage coverage it extended to the
Obligor by providing the Obligor with 30 days' prior written notice.
If Ryder terminates the physical damage coverage, the Obligor will
become responsible for all physical damage to the Vehicles, and must
provide Ryder with proof of satisfactory physical damage insurance.
OBLIGOR EXPENSES
With respect to each Vehicle an Obligor leases pursuant to a Lease, the
Obligor is responsible for the following expenses:
o taxes, licenses, fees and tolls (collectively, "Taxes") arising from
the use or operation of the Vehicle, other than those items Ryder
has contracted to pay for or provide, including sales, use, excise,
gross receipts or any similar tax, and any special license fees or
taxes resulting from the operation and use of the Vehicle by the
Obligor;
o any excess over the annual allowances that may be stated in the
Lease for state motor vehicle license fees, registration fees,
vehicle inspection fees, personal property taxes, federal vehicle
use taxes and fuel tax permits;
o any increased costs resulting from a change in the assessment method
for any of the preceding items;
o reimbursement of Ryder for settlement of a claim or lien resulting
from the Obligor's failure to pay any taxes, fees or tolls on the
Leased Vehicles; and
o all damages, repairs, maintenance and related expenses resulting
from the operation of the Vehicles in violation of the Lease terms.
The foregoing items comprise part of the Maintenance Component of Total Monthly
Payments and will not be available to make payments in respect of the Senior
Notes.
ACCIDENTS, VEHICLE THEFT OR VEHICLE DESTRUCTION
The Leases require the Obligors to notify Ryder immediately of any
accident involving an Insured Vehicle, to provide Ryder with a detailed report
of the accident and to cooperate with Ryder and the insurer of the Insured
Vehicle in defending any claim. Within 30 days after that notice, Ryder will
determine if the Insured Vehicle is damaged beyond economic repair. If so, once
the related Obligor pays Ryder all amounts owed under the Lease for the Insured
Vehicle, including any proceeds owed under any physical damage insurance policy
obtained by the Obligor, the Lease will terminate as to the Insured Vehicle.
The Obligors must also notify Ryder immediately if an Insured Vehicle
is lost or stolen. If an Insured Vehicle is not located within 30 days after
that notice, the related Lease will terminate as to the Insured Vehicle once the
related Obligor pays Ryder all amounts owed to Ryder for the Insured Vehicle
under the Lease, including any proceeds received by the Obligor under any
physical damage insurance policy.
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<PAGE> 37
CARGO LOSS
Ryder is not responsible for the loss of or damage to cargo carried in
or on any Insured Vehicle, even if the loss or damage is caused by Ryder's
negligence.
ANNUAL TERMINATION OPTION
The Leases generally contain an annual termination option (the "Annual
Termination Option") which permits either Ryder or the Obligor to terminate a
Lease on the annual anniversary of the date the related Vehicle was delivered to
the Obligor, or with respect to some Leases, more frequently, by giving the
other party at least 60 days' written notice of its election to exercise the
Annual Termination Option. If Ryder exercises the Annual Termination Option on a
Lease, the related Obligor will have the right, but not the obligation, to
purchase the related Vehicle. If an Obligor exercises the Annual Termination
Option on a Lease, Ryder has the option to require the Obligor to purchase the
related Vehicle on the effective date of the termination.
If an Obligor elects or is required to purchase a Vehicle in connection
with the exercise of the Annual Termination Option, the Obligor must remit a
payment to Ryder (the "Termination Value Payment") in the amount specified in
the Schedule A as the termination value of the Vehicle (the "Termination
Value"). Additionally, the Obligor must pay all sales and use taxes relating to
the purchase. The Termination Value of a Vehicle ordinarily will exceed its
Residual Value. If an Obligor fails to purchase a Vehicle when required to do
so, Ryder may solicit wholesale cash bids for the Vehicle and require the
Obligor to pay the difference between the highest bid and the Termination Value
of the Vehicle.
Obligors have neither the right nor the obligation to purchase a
Vehicle at the Maturity Date of the related Lease.
If an Obligor becomes bankrupt or insolvent, then the Obligor may have
the right to reject some or all of the Leases relating to the Obligor, in which
case the Obligor would not be required to perform its obligations under the
Leases, and although Ryder could treat the Leases as having been terminated,
Ryder could not enforce any requirement that the Obligor purchase the related
Obligor Vehicles.
36
<PAGE> 38
LEASE UNDERWRITING PROCEDURES
The underwriting or credit review and approval area is responsible for
all credit requests for potential and existing lease customers of Ryder. The
credit decision for a potential customer is based on an analysis of financial
information obtained from third party sources, bank and trade references, as
well as Ryder's experience with respect to the customer's payment performance.
The tools available to Ryder's underwriting staff include numerous automated
tools provided by the Dun & Bradstreet Corporation. Ryder's credit policy has
been centralized at the Shared Service Center with extensive oversight by
Ryder's corporate headquarters. For example, credit personnel are not able to
extend credit or increase credit limits beyond certain predetermined guidelines,
which are enforced by corporate headquarters. Any requests beyond the
predetermined limits require corporate approval.
INSURANCE
LIABILITY INSURANCE AND INDEMNITY
Each Lease specifies whether Ryder or the Obligor is responsible for
procuring and maintaining liability insurance on the related Vehicles and any
Substitute Vehicles. The liability insurance must cover both parties, either as
an insured or additional insured, for the ownership, maintenance, use and
operation of the Vehicles, up to certain specified per-occurrence dollar limits.
If the Obligor fails to obtain required liability insurance, then it must
indemnify Ryder for all damages arising out of the ownership, maintenance, use
or operation of the Vehicles. The insurer must be acceptable to Ryder, and the
liability insurance must provide primary coverage, rather than additional or
excess coverage. If Ryder extends its liability insurance to the Obligor, it may
terminate the extension of the insurance by providing the Obligor with 30 days'
prior written notice. The Obligor must then obtain the required liability
insurance from a third party insurer.
Each Lease requires the Obligor to indemnify Ryder for all damages in
excess of the liability insurance arising out of the ownership, maintenance, use
or operation of the Insured Vehicles and injuries or death to the Obligor or the
Obligor's employees, drivers or agents arising out of the ownership,
maintenance, use or operation of the Insured Vehicles.
PHYSICAL DAMAGE
OBLIGOR RISK OF LOSS. If an Obligor is required by a Lease to be
responsible for physical damage, the Obligor must pay for all physical damage,
including theft and loss, to the related Vehicles, even if the damage occurs as
a result of Ryder's negligence or on Ryder's premises. If a Vehicle is repaired
by a garage that Ryder has not approved and the repair is defective, then Ryder
may re-repair the Vehicle at the Obligor's expense. The Obligor must furnish
Ryder with evidence of reasonably acceptable physical damage insurance coverage
on the Vehicles, listing Ryder as the named insured or endorsed as the loss
payee. Ryder reserves the right to retain the salvage value of any Vehicle that
is damaged beyond economic repair. If Ryder elects to retain the salvage value,
it will deduct the salvage value from the amount owed to Ryder by the related
Obligor for the Vehicle.
RYDER RISK OF LOSS. If a Lease requires Ryder to be responsible
for physical damage to the related Vehicles, then Ryder assumes the risk of all
physical damage to and loss and theft of the Insured Vehicles, except that:
37
<PAGE> 39
o the Obligor remains responsible for the deductible amount per
occurrence as specified in the Schedule A;
o Ryder will not pay, and the Obligor is responsible, for physical
damage caused by the Obligor's violation of the Lease terms and for
any willful damage to an Insured Vehicle, including (1) damage
caused in a labor dispute involving the Obligor or (2) any theft or
conversion of an Insured Vehicle by the Obligor's employees or
agents; Ryder will be entitled to retain the salvage value of any
Insured Vehicle that is damaged beyond economic repair through an
excluded peril, in which case the salvage value of the Insured
Vehicle will be deducted from the amount owed by the Obligor; and
o Ryder may terminate its responsibility for physical damage to and
loss and theft of the Insured Vehicles by giving the Obligor 30
days' prior written notice, after which time the Obligor then
assumes all risk of loss with respect to, and must procure physical
damage insurance covering, those Vehicles.
COLLECTION, REPOSSESSION AND DISPOSITION PROCEDURES
COLLECTIONS. Ryder's collections activities have been centralized into
one administrative center at the Shared Service Center with more than [50]
professionals devoted to collections. Ryder uses numerous automated tools to
assist it in the identification, tracking and resolution of collections
disputes. In addition to various Dun & Bradstreet Corporation performance
indices, Ryder also uses a number of proprietary performance measurements. When
a delinquency is identified, Ryder makes calls and/or sends demand letters to
the delinquent Obligor. The tone of a phone call or the level of aggressiveness
placed on each collection effort is determined by the length and amount of the
delinquency, credit history and quality of the Obligor and customer relationship
considerations.
DEFAULTS. When an Obligor fails to bring its account back into accord
with contractual or otherwise acceptable payment terms, Ryder may issue a
default notice to the Obligor. Receipt of a default notification typically
requires the Obligor to remit payment within seven days and achieve either
contractual or otherwise acceptable payment terms. Failure to remit payment can
result in the termination of the related Lease, in which case Ryder will:
o demand the immediate return of all Obligor Vehicles,
o initiate repossession actions if the Obligor fails to return the
Obligor Vehicles, or
o require the Obligor to purchase the Obligor Vehicles for their
Termination Values.
REPOSSESSIONS. Once a Specified Vehicle is repossessed, depending on
its condition and specifications, if it is determined to still have useful life
remaining, it will either be leased to another customer of Ryder that has a need
for the same type of vehicle or placed into Ryder's commercial rental fleet, or
it will be sold into the marketplace through Ryder's used vehicle sales
marketing group.
SERVICING
LEASE COLLECTIONS. Billing transactions for both securitized and
unsecuritized vehicles will continue to be generated by Ryder's existing billing
system and appear on one invoice. A portion of the payments received with
respect to invoices that include securitized Vehicles will be paid to the
Origination Trust. The payments will be available for either partial or full
38
<PAGE> 40
payment of the financial component (the "Financial Component") of the fixed
charge portion (the "Fixed Charge") of the total monthly payment payable under
the Leases (the "Total Monthly Payment"). See "Lease Payments--Calculation of
the Financial Component".
On a daily basis, invoices that include securitized Vehicles will be
compared with payments received for the invoices. The appropriate amounts to be
paid to the Origination Trust and advanced by Ryder will be calculated
accordingly. See "Additional Document Provisions--The Administration
Agreement--Advances" for a discussion of the calculation of Financial Component
Advances and the repayment of the Advances.
RESIDUALS. Ryder will begin the disposal process for a Specified
Vehicle upon its return when the related Specified Lease has reached its
Maturity Date or date of early termination. Specified Vehicles will be prepared
for sale and placed on Ryder's used vehicle sales lots for retail/commercial
sales or they may be traded to manufacturers' groups through local or national
"trade packages".
If a Specified Vehicle is sold during the Collection Period in which
its lease terminates, Ryder will remit the Sales Proceeds to the SUBI Collection
Account within two days of processing. If the Specified Vehicle is not sold
during the Collection Period in which the Specified Vehicle comes off-lease,
Ryder will advance the Securitization Value to the SUBI Collection Account for
that Specified Vehicle. See "Additional Document Provisions--The Administration
Agreement--Advances" for a discussion of the calculation of Sales Proceeds
Advances and the repayment of those Advances.
LEASE PAYMENTS
Over the Lease Term, the Obligor is required to make Total Monthly
Payments intended to cover:
o the cost of financing the related Vehicles,
o scheduled depreciation of the Vehicles, and
o certain specified services and maintenance to be performed and
supplies to be furnished by Ryder.
Invoices are sent to each Obligor setting forth the Total Monthly
Payment due with respect to the Obligor Vehicles. Total Monthly Payments are
generally comprised of four components:
o the Fixed Charge, which is a fixed dollar amount due every month
during the Lease Term regardless of the actual usage of the Vehicle
by the Obligor;
o a variable charge, which changes from month to month depending on
Vehicle usage;
o a variable charge for fuel provided by Ryder during the preceding
month; and
o a variable charge for other services, including without limitation
accident charges, repairs, accessory charges, customer vehicle fuel
for non-Ryder vehicles, miscellaneous charges, credits and
interstate fuel taxes.
The Leases require the related Obligors to pay the invoiced Total Monthly
Payment within ten days of the date of the invoice. See "--Collection,
Repossession and Disposition Procedures". However, with regard to the Trust and
Specified Leases and as discussed in more detail below under "--Calculation of
the Financial Component," only the rights to the Financial Component
39
<PAGE> 41
of the Fixed Charge, which represents the financing cost and depreciation of the
related Specified Vehicle, will be available to the Transferor and the Trust to
make payments in respect of the Program Operating Lease and the Senior Notes.
Total Monthly Payments made by Obligors under the Specified Leases
normally will be paid by mail, deposited into a lock box maintained by a bank
and controlled by the Administrative Agent and then deposited into the SUBI
Collection Account within two Business Days of processing, unless the Monthly
Remittance Condition has been met, which would then permit the Administrative
Agent to make the deposits on a monthly basis. See "Additional Document
Provisions--The Administration Agreement--Collections".
CALCULATION OF THE FINANCIAL COMPONENT
In the case of the Specified Leases, only the rights to the Financial
Component of the Fixed Charge, which represents the financing cost and
depreciation of the related Specified Vehicle, will be available to the
Transferor and the Trust to make payments in respect of the Program Operating
Lease and the Senior Notes. Because the Financial Component and the Maintenance
Component are not billed separately to the Obligor or tracked separately by
Ryder, a predetermined dollar amount of the Fixed Charge component of Total
Monthly Payments will be identified as the Financial Component. The remainder of
the Fixed Charge, in addition to the other components of the Total Monthly
Payment, will comprise the Maintenance Component. The Maintenance Component will
be allocated to and retained by Ryder, as Maintenance Provider, pro rata with
the Financial Component. Although each Lease provides that Ryder may change the
Fixed Charge on specified dates twice yearly based on changes in the Consumer
Price Index, the Financial Component of each Specified Lease will be established
as of the Cutoff Date and will not change over the Lease Term.
Under the Administration Agreement, the portion of each Total Monthly
Payment allocated to the Maintenance Component of the Specified Leases will be
retained by the Maintenance Provider, will not be available to make Program
Operating Lease Payments and, therefore, will not be available to make payments
on the Senior Notes.
The following example is included to depict, with respect to a
hypothetical lease, the nature of its Financial Component and the relationship
of the Financial Component to the Securitization Rate in the amortization of the
Cutoff Date Securitization Value of the related leased vehicle. It is set forth
for illustrative purposes only.
Amortization of a vehicle lease contract:
Cutoff Date Securitization Value (Book Value) $30,000.00
Residual Value $26,000.00
Securitization Rate 8.00%
Remaining Lease Term (Months) 30
Fixed Charge Per Month $600.00
(Calculated) Financial Component $320.89
40
<PAGE> 42
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
32,000.00
Securitization 31,000.00 Cut-off Date
Value Securitization Value
30,000.00
29,000.00
Residual Value
28,000.00
27,000.00
Amortization of the Lease
26,000.00 (Decrease of Securitization Value)
25,000.00
0 5 10 15 20 25 30
</TABLE>
Depiction of the components of the Financial Component
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
350.00
Total 300.00
Financial
Component 250.00
200.00
150.00
100.00
[X] Interest
50.00
[ ] Depreciation
0.00
1 5 9 13 17 21 25 29
</TABLE>
CALCULATION OF THE SECURITIZATION VALUE OF THE SPECIFIED LEASES
Under the Administration Agreement, the Administrative Agent will
calculate a Securitization Value for each Specified Lease equal to the
following:
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<PAGE> 43
Calculation Date Securitization Value Formula
- ---------------- ----------------------------
as of the Cutoff Date -- the value of the Specified Lease and the related
Specified Vehicle on Ryder's books (the "Net Book
Value") as of the Cutoff Date (the "Cutoff Date
Securitization Value");
as of its Maturity Date -- the estimated sales proceeds of the Specified
Vehicle as determined on or before the Cutoff Date
(the "Residual Value"); and
as of any other date -- the present value, calculated using the
Securitization Rate, of the sum of (a) the
aggregate Financial Component payments remaining on
the Specified Lease and (b) the Residual Value of
the Specified Vehicle.
For each Specified Lease, the Financial Component will equal the
constant payment required to amortize the Net Book Value of the Specified Lease
and the related Specified Vehicle to the Residual Value of that Specified
Vehicle over the Lease Term, at a rate equal to the Securitization Rate. The
Securitization Value, which represents the amount of financing that will be
raised against each Specified Vehicle and related Specified Lease, will at any
given time during the term of the Specified Lease represent the principal amount
of Securities that can be amortized by the sum of the Financial Component
payments due in respect of the Specified Vehicle over the remaining Lease Term,
plus the Residual Value of the Specified Vehicle, in each case discounted at an
annualized rate equal to the Securitization Rate. The "Securitization Rate" will
equal the sum of (a) the weighted average interest rate on the Securities on the
Closing Date, (b) the Administration Fee and (c) [0.___%].
HISTORICAL DATA
The following tables set forth selected delinquency, write-off and
residual value performance data for Ryder's portfolio of leased trucks, tractors
and trailers located throughout the United States as of and for the years ended
December 31, 1993 through December 31, 1998, and the six months ended June 30,
1998 and 1999. The tables are followed by a discussion of Ryder's views as to
trends, anomalies and reasons for changes in the tables.
The data presented in the following tables are for illustrative
purposes only. Delinquency, write-off and residual value performance experience
may be influenced by a variety of economic, social, geographic and other
factors. Neither Ryder nor the Trust can assure that Ryder's delinquency,
write-off and residual value experience with respect to its portfolio of leased
trucks, tractors and trailers in the future, or the Trust's experience with
respect to the Specified Vehicles, will be similar to that set forth below.
Ryder writes off a receivable automatically when it is six months past
due. Prior to that time a write-off may be taken, on an account-by-account
basis, if Ryder's credit and collections personnel determine that circumstances
so warrant, such as in the case of a court-approved reorganization plan or a
liquidating obligor with poor pay-out prospects.
42
<PAGE> 44
DELINQUENCY EXPERIENCE
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30, AT DECEMBER 31,
--------------------------- --------------------------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
------------- ------------- -------------- ------------- ------------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
Number of Customers.. 11,979 10,965 11,217 11,287 11,393 10,923 10,208
Number of Vehicles... 92,276 84,258 88,249 83,091 79,750 78,561 72,313
Ending Net Book
Value of Vehicles... $ 2,857,591,050 2,486,163,560 2,615,245,281 2,443,976,045 2,453,850,570 2,414,791,790 2,011,432,118
Dollar Amount of
Leases Delinquent...
61-90 Days..... $5,990,596 6,068,691 7,794,902 7,579,897 3,885,370 1,624,538 1,449,054
91 Days or More $3,135,128 3,170,869 3,028,988 4,780,667 2,621,514 1,568,546 1,486,811
Percentage
Delinquent as a
Percentage of Net
Book Value
61-90 Days... 0.21% 0.24% 0.30% 0.31% 0.16% 0.07% 0.07%
91 Days or
More......... 0.11% 0.13% 0.12% 0.20% 0.11% 0.06% 0.07%
</TABLE>
----------------------
o The Ending Net Book Value of Vehicles is based on the sum of the Net
Book Value of all Vehicles under the Leases.
o In presenting the Dollar Amount of Leases Delinquent the period of
delinquency is based on the number of days any portion of a payment
is contractually past due.
o The Percentage Delinquent as a Percentage of Net Book Value is shown
as a percentage of the aggregate Net Book Value of Vehicles at
period end.
WRITE-OFF EXPERIENCE
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30, AT DECEMBER 31,
--------------------------- --------------------------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
------------- ------------- -------------- ------------- ------------- ------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Number of Customers.. 11,979 10,965 11,217 11,287 11,393 10,923 10,208
Number of Vehicles... 92,276 84,258 88,249 83,091 79,750 78,561 72,313
Ending Net Book
Value of Vehicles... 2,857,591,050 2,486,163,560 2,615,245,281 2,443,976,045 2,453,850,570 2,414,791,790 2,011,432,118
Dollar Amount of
Write-offs.......... $2,330,114 3,495,406 5,339,570 6,157,679 4,076,041 3,560,212 1,915,465
Write-offs as a
Percentage of Net
Book Value.......... 0.16% 0.28% 0.20% 0.25% 0.17% 0.15% 0.10%
</TABLE>
----------------------
o The Dollar Amount of Write-offs is based on the time at which Ryder
formally determines a Lease receivable to be uncollectible and
removes the Lease receivable from its books. Ryder's general policy
is to write off an account automatically when it is 6 months past
due. Prior to that time a write off may be taken, on an
account-by-account basis, if Ryder's collections personnel determine
that circumstances so warrant.
o The Dollar Amount of Write-offs is net of recoveries.
o Write-offs as a Percentage of Net Book Value are listed as a
percentage of the aggregate Net Book Value of Vehicles at period end
and six-month data is annualized.
RESIDUAL VALUE PERFORMANCE
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30, AT DECEMBER 31,
--------------------------- --------------------------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
------------- ------------- -------------- ------------- ------------- ------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Number of Vehicles
Sold................ 7,799 6,308 12,868 10,431 8,391 9,103 5,061
Aggregate Residual
Values of Vehicles
Sold................ $120,626,799 89,906,055 190,271,739 180,266,234 123,949,475 120,433,482 59,083,279
Aggregate Sales
Proceeds............ $140,258,967 107,941,002 225,322,796 211,878,187 147,923,019 149,847,757 76,789,821
Aggregate Gain (Loss) $19,632,167 18,034,947 35,051,056 31,611,953 23,973,544 29,414,274 17,706,542
Average Gain (Loss)
Per Vehicle......... $2,517 2,859 2,724 3,031 2,857 3,264 3,499
</TABLE>
o The Number of Vehicles Sold only includes Vehicles that were under
full service lease contracts. These full service lease contracts
were all originated after [December 31, 1989].
Ryder believes the increase in the number of vehicles under lease over
the periods presented by the tables above primarily reflects increased market
demand for leased vehicles, and the increasing trend in delinquency experience
through 1998 reflects relatively low levels of delinquency in earlier years and
start-up related inefficiencies associated with Ryder's strategic move to
centralizing its lease collection and administration activities in a national
shared service center. Ryder believes decreases in delinquency since this period
are the result of the improved collection effectiveness of the shared service
center.
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<PAGE> 45
Ryder believes the increasing trend in net write-off experience
reflected in the above table is due to general growth in the size of the lease
portfolio. The significant level of net write-off experience in 1997 as compared
to other periods presented by the tables above reflects the implementation of
the national shared service center. As part of its effort to uniformly apply
write-off policies across the Company, the shared service center wrote-off a
number of accounts in 1997 for which an allowance for loss was previously
provided, but the write-off had not yet occurred.
Ryder believes the increasing trend in the number of vehicles sold is
due to overall growth in the size of its portfolio, combined with the conscious
effort by Ryder, particularly in 1997, to control the size of its portfolio by
actively selling certain used equipment. Ryder believes competitive pressures on
selling prices, more accurate forecasting of the residual value of vehicles sold
and the sales efforts discussed previously are responsible for the decreasing
trend in average gain per vehicle since 1994 shown in the table above.
YEAR 2000 PREPARATION
The YEAR 2000 issue is the result of computer systems, software
products and embedded technology using two digits rather than four to indicate
the applicable year. If not addressed, such computer systems, software products
and embedded technology may be unable to properly interpret dates beyond the
year 1999, which could cause system failures or miscalculations and lead to
disruptions in the activities and operations of Ryder System and its
subsidiaries, including Ryder.
During 1997, after consideration of the potential impact to operations,
including customer and supplier relationships, an enterprise-wide program was
initiated to modify computer information systems to be Year 2000 compliant or to
replace non-compliant systems at Ryder System and its subsidiaries. A Year 2000
Steering Committee comprised of senior executives was established to address
compliance issues and alternatives. A program office dedicated to implementing
the Year 2000 compliance plan was also established, and it has engaged external
consultants to provide day-to-day management oversight and contractors to
remediate and test non-compliant source code. Ryder System has stated that it
believes adequate resources have been allocated to the Year 2000 effort and that
it expects the Year 2000 compliance program to be completed on a timely basis.
Ryder System and its subsidiaries have identified three major areas
determined to be critical for successful Year 2000 compliance:
o information systems, such as mainframes, PCs, networks and similar
type systems maintained at customer sites, and legacy applications
relating to operations such as financial reporting, human resources,
purchasing, treasury, marketing and sales;
o third-party relationships, including customers, suppliers, vendors
and government agencies; and
o facilities and equipment which may contain microprocessors with
embedded technology.
44
<PAGE> 46
Ryder System and its subsidiaries' Year 2000 compliance program for
each major area can be segregated into three broad phases. Phase I of the
program is the assessment of information systems, facilities and equipment, and
services and products provided by third parties in order to identify exposures
to Year 2000 issues and to develop a master plan of action including
remediation, retirement or replacement of non-compliant systems. Phase II of the
program is the implementation of action plans. Phase III of the program is the
final testing of each major area of exposure to ensure compliance, the placement
of remediated items into production and contingency planning to assess
reasonably likely worst case scenarios.
Ryder System and its subsidiaries have completed the assessment of the
legacy application and system software. Their remediation plan for this area is
segregated into 15 major partitions worldwide. Overall, approximately 99% of the
effort in this area had been performed as of September 30, 1999. Remediation and
testing activities were virtually complete on core business applications as of
September 30, 1999. Final testing of remediated code is scheduled to be
substantially completed during November of 1999. In addition, due to the
uncertainties inherent in this undertaking, contingency planning has been
initiated to evaluate a course of action to minimize the impact of any
unforeseen disruption resulting from non-compliance.
Ryder System and its subsidiaries rely on suppliers, vendors and
government agencies to timely provide a wide range of goods and services,
including equipment, supplies, telecommunications, utilities, transportation
services and banking services. Their management believes that third-party
relationships represent the greatest risk with respect to the Year 2000 issue
because of their limited ability to influence actions of third parties and to
estimate the impact of non-compliance of third parties throughout their
operations. They are making concerted efforts to understand the Year 2000 status
of third parties whose Year 2000 non-compliance could either have a material
adverse effect on their business, financial condition or results of operations
or involve a safety risk to their employees or customers. They continue to
survey and communicate with customers, suppliers and vendors with whom they have
important financial and operational relationships to assess the status of their
Year 2000 compliance program and to develop a joint contingency plan.
The vendor compliance program of Ryder System and its subsidiaries
includes the following: assessing vendor compliance status; tracking vendor
compliance progress; developing contingency plans, including identifying
alternate vendors, as needed; addressing contract language; replacing,
remediating or upgrading equipment; requesting certification from vendors or
making on-site assessments, as required; and sending questionnaires and
conducting phone interviews. Some significant suppliers and vendors have not
responded to inquiries, have declined to respond because of liability concerns
or have not responded with sufficient detail for Ryder System and its
subsidiaries to ensure (a) timely Year 2000 compliance, or (b) the impact to the
company in the event of non-compliance. Ryder System is continuing to pursue
adequate responses from mission critical business partners under the new "Year
2000 Readiness Disclosure" legislation. However, Ryder System and its
subsidiaries can provide no assurance that Year 2000 compliance plans will be
successfully completed by third parties in a timely manner.
In the facilities and equipment area, Ryder's exposure relates to
embedded technology in, among other things, vehicles, vehicle-related devices,
and fuel storage and other facilities. Based upon preliminary testing and
discussions with major truck manufacturers, it appears that the microprocessors
installed by the truck manufacturers are Year 2000 compliant. Remediation of
45
<PAGE> 47
leak detection devices on underground fuel storage tanks has been completed.
Ryder is continuing to assess its exposure and to develop action and contingency
plans for other critical facilities and equipment, including on-board vehicle
computers acquired from manufacturers other than major truck manufacturers.
Ryder System and its subsidiaries have developed a Year 2000
contingency plan development process to mitigate potential disruptions in their
activities and operations that may be created by failures of critical business
partners, facilities and equipment, and internal systems. Their management
currently believes that the most likely worst case scenario will consist of some
localized disruptions of systems that may affect individual business processes,
facilities or suppliers for a short time rather than systemic or long-term
problems affecting business operations as a whole. Through visits to key
operating sites, departments, customers, and vendors, potential disruption
scenarios are being identified and contingency plans are being developed. These
plans address preparation, assessment of failure, and resumption of critical
business functions. Detailed contingency plans for each business unit and for
critical business processes are expected to be completed during November of
1999. However, Ryder System and its subsidiaries can provide no assurance that
they will correctly anticipate the level, impact or duration of non-compliance
by critical business partners, facilities and equipment or internal systems, or
that contingency plans will be sufficient to mitigate the impact of
non-compliance.
The inability of Ryder to address the necessary Year 2000 modifications
of computerized information systems could result in a significant adverse effect
on its performance as Administrative Agent and Maintenance Provider, including
the potential inability to collect receivables, pay obligations, and operate
service facilities. Any such inability could have a material adverse effect on
Senior Noteholders and you could suffer a loss on your investment.
The foregoing description under the heading "Year 2000 Preparation"
contains various "forward looking statements" within the meaning of Section 27A
of the Securities Act and Section 21E of the Securities Exchange Act of 1934
(the "Exchange Act"), which represent expectations or beliefs expressed by Ryder
System management concerning future events, including that the assessment and
remediation efforts associated with Year 2000 issues will be completed by Ryder
System and its subsidiaries on a timely basis and that completion of the
contingency plan relating to year 2000 issues is expected by the end of fiscal
year 1999. Ryder System cautions that these statements are further qualified by
important factors that could cause actual results to differ materially from
those in the forward looking statements, including the failure of Ryder System
and its subsidiaries to resolve year 2000 issues on a timely basis due to
non-performance by outside contractors, the failure of third parties to
remediate their year 2000 issues or other factors, or the failure of Ryder
System and its subsidiaries to develop an adequate contingency plan relating to
year 2000 issues. Results actually achieved thus may differ materially from the
expected results included in these statements. The safe harbor for forward
looking statements under Section 27A of the Securities Act and Section 21E of
the Exchange Act does not apply to initial public offerings but does apply to
the Exchange Act reports from which the foregoing statements by Ryder System
have been taken.
ADDITIONAL INFORMATION ON THE COST TO RYDER SYSTEM OF ADDRESSING YEAR
2000 ISSUES AND ON ITS OTHER RELATED EFFORTS AND CONTINGENCY PLANS IS AVAILABLE
IN PERIODIC REPORTS FILED BY RYDER SYSTEM WITH THE SEC, WHICH ARE AVAILABLE FROM
THE SEC'S REFERENCE FACILITIES AND WEB SITE, THE ADDRESSES FOR WHICH ARE SET
FORTH UNDER "AVAILABLE INFORMATION."
46
<PAGE> 48
THE SPECIFIED LEASES
GENERAL
The Specified Leases selected from the Origination Trust's portfolio of
Leases will consist of a pool of ______ Vehicles for which the related Leases
had an Aggregate Cutoff Date Securitization Value of $____________. The
Specified Leases were assigned to the Origination Trust by Ryder on or prior to
the Closing Date. The Specified Leases are operating leases under generally
accepted accounting principles and have been selected based upon the criteria
specified in the SUBI Trust Agreement and described under "--Characteristics of
the Specified Leases--General" and "--Representations, Warranties and
Covenants". Ryder will represent and warrant that it used no adverse selection
procedures in selecting the Specified Leases for allocation to the Lease SUBI as
SUBI Assets and that it is not aware of any bias in the selection of the
Specified Leases that would cause delinquencies or losses on the Specified
Leases to be worse than any other Leases held by the Origination Trust. However,
there can be no assurance as to delinquencies or losses on the Specified Leases.
Each Specified Lease will provide that Ryder may terminate the
Specified Lease and repossess the related Specified Vehicle following an event
of default by the related Obligor (each, a "Lease Default"). Typical Lease
Defaults include, but may not be limited to, failure of the Obligor to make
payments when due, certain events of bankruptcy or insolvency of the Obligor,
failure of the Obligor to maintain the insurance required by the related
Specified Lease (if the Obligor is required to maintain the insurance), failure
to make required repairs on the related Specified Vehicle or failure to comply
with any other term or condition of the Specified Lease. Ryder regularly tracks
Obligors' compliance with their payment and insurance obligations and monitors
Obligors for noncompliance as more fully described under "Ryder--Insurance" and
"--Collection, Repossession and Disposition Procedures".
In the event of termination of a Specified Lease where the related
Obligor is in default following a casualty of the related Specified Vehicle,
amounts collected with respect to the Specified Lease and Specified Vehicle,
after deducting costs and other sums retained by the Administrative Agent in
connection therewith, may be less than the Securitization Value of the Specified
Lease. In the event that any of the foregoing shortfalls are not covered from
available monies on deposit in the Residual Value Surplus Account and Reserve
Fund and the subordination of payments otherwise payable to the holders of the
Subordinated Notes and the Certificates to the extent described in this
prospectus, investors in the Senior Notes could suffer a loss on their
investment.
CHARACTERISTICS OF THE SPECIFIED LEASES
GENERAL. The Specified Leases were selected by reference to several
criteria, including, that as of the Cutoff Date, each Specified Lease applied to
a Specified Vehicle that:
o is a truck, tractor or trailer;
o has a model year of 1998 or later;
o is subject to a Lease with a Maturity Date on or after the [August
2000] Payment Date and no later than the [August 2009] Payment Date;
and
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<PAGE> 49
o Fixed Charge payments in respect of which were not more than 60 days
past due as of the Cutoff Date.
Based on an analysis of the recent payment history of the Specified Leases, on
average 53% paid in under 30 days and the remaining 47% paid on average in 31 to
60 days of the due date.
FOR A LISTING OF OTHER APPLICABLE SELECTION CRITETIA SEE "--REPRESENTATIONS,
WARRANTIES AND COVENANTS".
As of the Cutoff Date, the Specified Leases had:
o an average Cutoff Date Securitization Value of $__________;
o a weighted average original term of ______ months;
o a weighted average term to maturity of _____ months; and
o an aggregate Securitization Value (the "Aggregate Cutoff Date
Securitization Value") of $__________.
As of the Cutoff Date, no single Obligor accounted for more than
______% of the total Net Book Value of the Specified Vehicles. As of the Cutoff
Date, the top five and ten Obligors accounted for approximately ____% and ____%
of the Specified Vehicles by Aggregate Cutoff Date Securitization Value,
respectively, and the Specified Vehicles had an aggregate Residual Value of
$__________.
DISTRIBUTION OF THE SPECIFIED VEHICLES BY CUTOFF DATE SECURITIZATION
VALUE
As of the Cutoff Date, the composition of the Specified Vehicles by
Cutoff Date Securitization Value was as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE
NUMBER OF AGGREGATE CUTOFF DATE CUTOFF DATE
CUTOFF DATE SECURITIZATION VALUE ($) VEHICLES SECURITIZATION VALUE ($) SECURITIZATION VALUE
- ------------------------------------ -------- ------------------------ --------------------
<S> <C> <C> <C>
6,711.00 to 10,000.00 1 6,711.00 0.00
10,000.01 to 20,000.00 318 5,919,426.00 1.97
20,000.01 to 30,000.00 571 14,707,224.00 4.90
30,000.01 to 40,000.00 897 32,063,620.00 10.69
40,000.01 to 50,000.00 1,133 51,094,641.00 17.04
50,000.01 to 60,000.00 1,594 88,063,177.00 29.37
60,000.01 to 70,000.00 1,210 77,977,999.00 26.00
70,000.01 to 80,000.00 339 24,898,695.00 8.30
80,000.01 to 90,000.00 55 4,516,370.00 1.51
90,000.01 to 100,000.00 3 284,819.00 0.09
100,000.01 to 110,000.00 2 202,684.00 0.07
120,000.01 to 125,195.00 1 125,195.00 0.04
----- -------------- ------
Total: 6,124 299,860,561.00 100.00
===== ============== ======
</TABLE>
- -------------------------------
o The percentage column may not add to 100.00% due to rounding.
48
<PAGE> 50
DISTRIBUTION OF THE SPECIFIED VEHICLES BY ORIGINAL MATURITY
As of the Cutoff Date, the distribution of the Specified Vehicles by
the term of original maturity was as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE
NUMBER OF AGGREGATE CUTOFF DATE CUTOFF DATE
TERM OF MATURITY VEHICLES SECURITIZATION VALUE ($) SECURITIZATION VALUE
- ---------------- -------- ------------------------ --------------------
<S> <C> <C> <C>
24--35 months 13 621,375.00 0.21
36--47 months 302 14,523,601.00 4.84
48--59 months 442 19,256,604.00 6.42
60--71 months 1,312 60,526,877.00 20.19
72--83 months 2,811 144,078,353.00 48.05
84--95 months 937 47,335,644.00 15.79
96--107 months 284 12,758,439.00 4.25
108--120 months 23 759,668.00 0.25
----- -------------- ------
Total: 6,124 299,860,561.00 100.00
===== ============== ======
</TABLE>
- ---------------------------------
o The percentage column may not add to 100.00% due to rounding.
DISTRIBUTION OF THE SPECIFIED VEHICLES BY REMAINING TERM
As of the Cutoff Date, the composition of the Specified Vehicles by
number of months until Maturity Date was as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE
NUMBER OF AGGREGATE CUTOFF DATE CUTOFF DATE
REMAINING TERM VEHICLES SECURITIZATION VALUE ($) SECURITIZATION VALUE
- -------------- -------- ------------------------ --------------------
<S> <C> <C> <C>
12--23 months 17 583,234.00 0.19
24--35 months 202 9,227,432.00 3.08
36--47 months 447 19,975,438.00 6.66
48--59 months 1,124 50,416,554.00 16.81
60--71 months 2,040 104,589,229.00 34.88
72--83 months 1,872 95,087,989.00 31.71
84--95 months 379 18,408,244.00 6.14
96--107 months 24 945,464.00 0.32
108--120 months 19 626,977.00 0.21
----- -------------- ------
Total: 6,124 299,860,561.00 100.00
===== ============== ======
</TABLE>
- ---------------------------
o The percentage column may not add to 100.00% due to rounding.
49
<PAGE> 51
DISTRIBUTION OF THE SPECIFIED VEHICLES BY STATE
As of the Cutoff Date, the distribution of the Specified Vehicles by
state of origination, based on the state in which the related Specified Vehicle
is titled, was as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF AGGREGATE CUTOFF DATE AGGREGATE CUTOFF DATE
STATE VEHICLES SECURITIZATION VALUE ($) SECURITIZATION VALUE
- ----- -------- ------------------------ ---------------------
<S> <C> <C> <C>
Alabama 398 20,671,642.00 6.89
Arizona 139 5,749,199.00 1.92
California 409 20,050,941.00 6.69
Colorado 198 9,377,550.00 3.13
Delaware 12 634,280.00 0.21
Florida 1 65,766.00 0.02
Idaho 9 481,928.00 0.16
Illinois 55 2,667,049.00 0.89
Indiana 561 23,988,615.00 8.00
Kansas 108 5,543,690.00 1.85
Maryland 11 541,909.00 0.18
Massachusetts 340 14,903,692.00 4.97
Minnesota 92 4,096,412.00 1.37
Mississippi 243 13,516,872.00 4.51
New Mexico 35 1,819,000.00 0.61
North Carolina 645 35,263,637.00 11.76
Ohio 501 24,436,682.00 8.15
Oklahoma 173 7,233,149.00 2.41
Oregon 33 1,547,503.00 0.52
Pennsylvania 648 30,595,027.00 10.20
South Carolina 315 16,626,151.00 5.54
Tennessee 542 29,769,022.00 9.93
Utah 31 1,345,720.00 0.45
Virginia 230 9,351,329.00 3.12
Washington 135 7,259,174.00 2.42
Wisconsin 260 12,324,622.00 4.11
----- -------------- ------
Total: 6,124 299,860,561.00 100.00
===== ============== ======
</TABLE>
- --------------------------
o The percentage column may not add to 100.00% due to rounding.
50
<PAGE> 52
DISTRIBUTION OF THE SPECIFIED VEHICLES BY ASSET CLASS
As of the Cutoff Date, the distribution of the Specified Vehicles by
asset class was as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF AGGREGATE CUTOFF DATE AGGREGATE CUTOFF DATE
ASSET CLASS VEHICLES SECURITIZATION VALUE ($) SECURITIZATION VALUE
----------- -------- ------------------------ --------------------
<S> <C> <C> <C>
Dry Trailer 285 5,989,630.00 2.00
Diesel Truck (less than or equal to
16,000 pounds) 326 8,884,786.00 2.96
Diesel Truck (less than or equal to
26,000 pounds/less than or equal to 20
feet) 260 10,343,356.00 3.45
Diesel Truck (less than or equal to
26,000 pounds/greater than 20 feet) 513 19,770,066.00 6.59
Diesel Truck (greater than 26,000
pounds/less than or equal to
20 feet) 55 2,489,477.00 0.83
Diesel Truck (greater than 26,000
pounds/greater than 20 feet) 356 15,801,745.00 5.27
Flatbed Trailer 7 123,093.00 0.04
Gas Straight Truck 18 434,563.00 0.14
Other Tractor 13 831,539.00 0.28
Other Trailer 2 91,583.00 0.03
Other Truck 267 11,722,737.00 3.91
Panel Van and Pickup 123 2,390,687.00 0.80
Parcel Van 65 1,580,372.00 0.53
Refrigeration Trailer 43 2,492,258.00 0.83
Refrigeration Truck (greater than or
equal to 26,000 pounds) 189 9,017,340.00 3.01
Refrigeration Truck (less than or equal
to 26,000 pounds) 126 7,479,114.00 2.49
Single Axle Sleeper Tractor 56 3,260,507.00 1.09
Single Axle Tractor 866 42,629,874.00 14.22
Stake and Flatbed Truck 168 6,968,764.00 2.32
Tandem Axle Cab-Over Engine Sleeper 1 56,913.00 0.02
Tandem Axle Conventional Sleeper
Tractor 1,426 92,621,140.00 30.89
Tandem Axle Tractor 959 54,881,017.00 18.30
----- -------------- ------
Total 6,124 299,860,561.00 100.00
===== ============== ======
</TABLE>
o The percentage column may not add to 100.00% due to rounding.
51
<PAGE> 53
DISTRIBUTION OF THE SPECIFIED VEHICLES BY MANUFACTURER
As of the Cutoff Date, the distribution of the Specified Vehicles by
manufacturer was as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF AGGREGATE CUTOFF DATE AGGREGATE CUTOFF DATE
MANUFACTURER VEHICLES SECURITIZATION VALUE ($) SECURITIZATION VALUE
- ------------ -------- ------------------------ --------------------
<S> <C> <C> <C>
Freightliner 2,413 141,100,402.00 47.06
International (Navistar) 1,842 83,705,778.00 27.91
Mack Trucks 555 29,017,035.00 9.68
Isuzu 422 12,205,878.00 4.07
Volvo 101 6,835,305.00 2.28
General Motors Corp 228 6,273,515.00 2.09
Kenworth 64 5,098,590.00 1.70
Great Dane Trailers 207 4,327,056.00 1.44
Utility Trailers 79 3,041,046.00 1.01
Peterbilt 27 2,017,732.00 0.67
Ford 70 1,722,979.00 0.57
Ottawa 28 1,416,525.00 0.47
Sterling Ford 24 1,340,011.00 0.45
Trailmobile Trailers 28 743,680.00 0.25
Stoughton Trailers 16 287,248.00 0.10
Other 5 180,667.00 0.06
Dorsey Trailers 3 137,380.00 0.05
Freightliner Custom Chassis Corp 3 133,337.00 0.04
Cheverolet 4 91,397.00 0.03
Clements Trailer 2 78,440.00 0.03
Budd Trailer 1 43,460.00 0.01
Fruehauf Trailers 1 38,254.00 0.01
Dodge 1 24,846.00 0.01
----- -------------- ------
Total 6,124 299,860,561.00 100.00
===== ============== ======
</TABLE>
o The percentage column may not add to 100.00% due to rounding.
REPRESENTATIONS, WARRANTIES AND COVENANTS
The Specified Leases and the related Specified Vehicles will be
described in a schedule appearing as an exhibit to the SUBI Trust Agreement,
which will identify each Specified Vehicle by vehicle identification number and
set forth as to each Specified Lease or Specified Vehicle, as the case may be,
among other things:
o the date of origination,
o the Net Book Value,
o the Residual Value,
o the Financial Component,
o the Fixed Charge, and
52
<PAGE> 54
o the number of months remaining from the Cutoff Date to the month in
which the Maturity Date occurs.
Under the Administration Agreement, the Administrative Agent will
represent and warrant as to certain characteristics of each Specified Lease and
Specified Vehicle as described in the first paragraph under "--Characteristics
of the Specified Leases--General". The Administrative Agent will also represent
and warrant thaT each Specified Lease or, to the extent applicable, the related
Specified Vehicle or Obligor:
o was originated by Ryder in the United States for an Obligor with a
U.S. address in the ordinary course of Ryder's business;
o is a U.S. dollar-denominated obligation;
o has been validly assigned to the Origination Trust by Ryder, except
that if a Specified Vehicle is a Titling Grace Period Vehicle, it
will be retitled in the name of the Origination Trust or the
Origination Trustee on behalf of the Origination Trust during the
Titling Grace Period, and Ryder will provide each Rating Agency with
a report on the status of such retitling on or before the end of the
Titling Grace Period;
o provides for constant or increasing Fixed Charge payments to be made
by the Obligor over the Lease Term;
o is a Lease as to which no selection procedure was used that was
believed to be adverse to the holders of interests in the
Origination Trust, the SUBIs or any Other SUBI;
o was created in compliance in all material respects with all
applicable federal and state laws, including disclosure laws;
o as of the date assigned to the Origination Trust, (a) is a legal,
valid and binding payment obligation of the Obligor, enforceable
against the Obligor in accordance with its terms, as amended, (b)
has not been satisfied, subordinated, rescinded, canceled or
terminated, (c) no right of rescission, setoff, counterclaim or
defense has been asserted or threatened in writing and (d) no
written default notice has been transmitted to Ryder;
o had an original term of not less than 12 months and has a remaining
term of not greater than 120 months;
o an executed copy of the documentation associated therewith is
located at one of Ryder's offices;
o the Obligor or Ryder has obtained physical damage insurance covering
the related Specified Vehicle as required under the Lease;
o the Obligor or Ryder has obtained liability insurance covering the
related Specified Vehicle as required under the Lease;
o does not have any Fixed Charge payment that is in whole or in part
more than 60 days past due as of the Cutoff Date;
o has not had any liens or claims filed on or against it for work,
labor or materials; and
o the monthly Fixed Charge due is equal to or greater than the monthly
Financial Component due in respect thereof.
53
<PAGE> 55
The Administrative Agent will be required to deposit or cause to be
deposited into the SUBI Collection Account an amount equal to the Securitization
Value of a Specified Lease (the "Reallocation Payment") if:
o the Origination Trustee, the Administrative Agent, the Trust or the
Transferor discovers a breach of any representation, warranty or
covenant referred to in the preceding paragraph that materially and
adversely affects the Trust's interests in a Specified Lease or
Specified Vehicle, and
o the breach is not cured in all material respects within 60 days
after the Administrative Agent discovers the breach or is given
notice of it.
The Reallocation Payment must be made by the Administrative Agent as of
the day on which the related cure period ended. Upon such payment, the related
Specified Lease and Specified Vehicle shall no longer constitute SUBI Assets.
The foregoing payment obligation will survive any termination of Ryder as
Administrative Agent under the Administration Agreement. Under some
circumstances, the Administrative Agent will be required to make Reallocation
Payments in respect of some Specified Leases as to which certain servicing
procedures have not been followed that materially and adversely affect the
interests of the Trust in the Specified Lease. Additionally, if the
Administrative Agent fails to properly retitle any Titling Grace Period Vehicle
during the Titling Grace Period, it will be required to make a deposit in the
SUBI Collection Account equal to the Securitization Value of the related
Specified Lease as of the last day of the Titling Grace Period and such
Specified Lease and the related Specified Vehicle will be transferred to the
Administrative Agent.
MATURITY, PAYMENT AND YIELD CONSIDERATIONS
In general, the rate of payment of principal and the yield to maturity
of the Senior Notes will be directly related to the rate at which payments on or
in respect of the Specified Leases and the Specified Vehicles are made. A
prepayment of a Specified Lease in full may be in the form of:
o proceeds resulting from a voluntary early termination of the
Specified Lease;
o proceeds resulting from the exercise of the Annual Termination
Option and receipt of the related Termination Value Payment;
o Termination Proceeds following a default by or bankruptcy of the
related Obligor;
o Insurance Proceeds resulting from Casualty Termination Leases; or
o Reallocation Payments made by the Administrative Agent.
The rate of prepayments on the Specified Leases may be influenced by a
variety of economic, social and other factors, including competing truck,
tractor and trailer lessors and the conditions in the used truck, tractor and
trailer market.
Ryder does not maintain records of the historical prepayment experience
of its truck, tractor and trailer lease portfolio. Ryder is not aware of any
publicly available industry statistics setting forth termination rates for
truck, tractor and trailer leases similar to the Leases. Neither Ryder nor the
Trust can assure that prepayments on the Specified Leases will conform to any
54
<PAGE> 56
historical experience, nor can they predict the actual prepayment rates that may
be experienced on the Specified Leases.
In general, prepayments of Specified Leases will shorten the weighted
average life of the Senior Notes, which is the average amount of time during
which each dollar of the principal balance of a Senior Note is outstanding. As
the rate of payment of principal on the Senior Notes will depend primarily on
the rate of payment - including prepayments - of the Specified Leases, the final
payment of principal of the Senior Notes could occur significantly earlier than
the final payment dates specified on the front cover of this prospectus for each
class of Senior Notes (each, a "Final Payment Date"). If prepayments on
Specified Leases cause the principal of the Senior Notes to be paid earlier than
anticipated, the Senior Noteholders will bear the risk of being able to reinvest
principal payments at interest rates at least equal to the Interest Rate on the
Senior Notes.
The effective yield on, and average life of, the Senior Notes will
depend on, among other things, the amount of scheduled payments on or in respect
of the Specified Leases and the Specified Vehicles and the rate at which such
payments are made to the Senior Noteholders. The timing of changes in the rate
of payments in respect of the Specified Vehicles also may affect significantly
an investor's actual yield to maturity and the average life of the Senior Notes.
A substantial increase in the rate of payments on or in respect of the Specified
Leases and Specified Vehicles - including liquidations of the Specified Leases -
may shorten the final maturity of, and may significantly affect the yield on,
the Senior Notes.
An investor's expected yield will be affected by:
o the price paid for the Senior Notes,
o the rate of prepayments of the Specified Leases, and
o the investor's assumed reinvestment rate.
These factors do not operate independently, but are interrelated. For example,
if prepayments on the Specified Leases are slower than anticipated, an
investor's yield will be lower if interest rates are higher than anticipated and
higher if interest rates are lower than anticipated. Conversely, if prepayments
on the Specified Leases are faster than anticipated, an investor's yield will be
higher if interest rates are higher than anticipated and lower if interest rates
are lower than anticipated.
The following information is provided solely to illustrate the effect
of prepayments of the Specified Leases on the unpaid principal amounts of the
Senior Notes and the weighted average life of the Senior Notes under the
assumptions stated below, and is not a prediction of the prepayment rates that
might actually be experienced with respect to the Specified Leases.
Prepayments on truck, tractor and trailer leases may be measured by a
prepayment standard or model. The prepayment model used in this prospectus is
based on a Conditional Prepayment Rate. A "Conditional Prepayment Rate" or "CPR"
represents a constant annual rate of prepayment relative to the then outstanding
Securitization Value of a pool of Specified Leases applied monthly during the
indicated portion of the life of a Specified Lease. A 100% Prepayment Assumption
assumes a 0% CPR for the first month of the life of a Specified Lease and an
additional 12/11% CPR per annum each month thereafter during the life of the
Specified Lease until month 12. Beginning in the 12th month and in each month
thereafter until the 30th month during the life of a Specified Lease, a 100%
Prepayment Assumption assumes a 12% CPR
55
<PAGE> 57
per annum. Beginning in the 30th month during the life of a Specified Lease, a
100% Prepayment Assumption assumes a 12% CPR and an additional 1/3% CPR per
annum each month thereafter until month 60 and each month thereafter during the
life of a Specified Lease, a 100% Prepayment Assumption assumes a 22% CPR.
The tables below were prepared on the basis of certain assumptions,
including that:
o all Total Monthly Payments are timely received and no Specified
Lease is ever delinquent;
o no Reallocation Payment is made in respect of any Specified Lease;
o there are no losses in respect of the Specified Leases;
o an Optional Purchase does not occur;
o distributions of principal of and interest on the Senior Notes are
made on January 15, April 15, July 15 and October 15 of each year
whether or not the day is a Business Day;
o all payments in respect of the Subordinated Notes are deposited to
the Reserve Fund;
o the Administration Fee is 1.00% per annum;
o all prepayments on the Specified Leases are prepayments in full;
o all Program Operating Lease Payments are timely made;
o no Residual Value Surplus is deposited into the Residual Value
Surplus Account; and
o the Reserve Fund is funded with an amount equal to the Initial
Deposit.
No representation is made as to what the actual levels of losses and
delinquencies on the Specified Leases will be. Because payments on the Specified
Leases will differ from those used in preparing the following tables,
distributions of principal of the Senior Notes may be made earlier or later than
as set forth in the tables. Investors are urged to make their investment
decisions on a basis that includes their determination as to anticipated
prepayment rates under a variety of the assumptions discussed herein.
56
<PAGE> 58
The following tables set forth the percentages of the unpaid principal
balance of the Senior Notes that would be outstanding after each of the dates
shown, based on a rate equal to 0%, 50%, 100%, 150% and 200% of the Prepayment
Assumption. As used in the table, "0% Prepayment Assumption" assumes no
prepayments on a Specified Lease, "50% Prepayment Assumption" assumes that a
Specified Lease will prepay at 50% of the Prepayment Assumption, and so forth.
PERCENTAGE OF CLASS A-1 SENIOR NOTE BALANCE OUTSTANDING
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
PAYMENT DATE 0% 50% 100% 150% 200%
-- --- ---- ---- ----
_______ 1999 100% 100% 100% 100% 100%
_______ 2000
_______ 2000
_______ 2001
_______ 2001
_______ 2002
_______ 2002
_______ 2003
_______ 2003
_______ 2004
_______ 2004
_______ 2005
_______ 2005
Weighted Average Life (years)
</TABLE>
-----------------------------------------
o The weighted average life of the Class A-1 Senior Notes is
determined by (a) multiplying the amount of each distribution in
reduction of principal balance by the number of years from the
Closing Date to the related Payment Date, (b) adding the results
and (c) dividing the sum by the aggregate distributions in
reduction of principal balance referred to in clause (a).
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PERCENTAGE OF CLASS A-2 SENIOR NOTE BALANCE OUTSTANDING
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
PAYMENT DATE 0% 50% 100% 150% 200%
-- --- ---- ---- ----
_______ 1999 100% 100% 100% 100% 100%
_______ 2000
_______ 2000
_______ 2001
_______ 2001
_______ 2002
_______ 2002
_______ 2003
_______ 2003
_______ 2004
_______ 2004
_______ 2005
_______ 2005
Weighted Average Life (years)
</TABLE>
-----------------------------------------
o The weighted average life of the Class A-2 Senior Notes is
determined by (a) multiplying the amount of each distribution in
reduction of principal balance by the number of years from the
Closing Date to the related Payment Date, (b) adding the results
and (c) dividing the sum by the aggregate distributions in
reduction of principal balance referred to in clause (a).
PERCENTAGE OF CLASS A-3 SENIOR NOTE BALANCE OUTSTANDING
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
PAYMENT DATE 0% 50% 100% 150% 200%
-- --- ---- ---- ----
_______ 1999 100% 100% 100% 100% 100%
_______ 2000
_______ 2000
_______ 2001
_______ 2001
_______ 2002
_______ 2002
_______ 2003
_______ 2003
_______ 2004
_______ 2004
_______ 2005
_______ 2005
Weighted Average Life (years)
</TABLE>
-----------------------------------------
o The weighted average life of the Class A-3 Senior Notes is
determined by (a) multiplying the amount of each distribution in
reduction of principal balance by the number of years from the
Closing Date to the related Payment Date, (b) adding the results
and (c) dividing the sum by the aggregate distributions in
reduction of principal balance referred to in clause (a).
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<PAGE> 60
PERCENTAGE OF CLASS A-4 SENIOR NOTE BALANCE OUTSTANDING
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
PAYMENT DATE 0% 50% 100% 150% 200%
-- --- ---- ---- ----
_______ 1999 100% 100% 100% 100% 100%
_______ 2000
_______ 2000
_______ 2001
_______ 2001
_______ 2002
_______ 2002
_______ 2003
_______ 2003
_______ 2004
_______ 2004
_______ 2005
_______ 2005
Weighted Average Life (years)
</TABLE>
-----------------------------------------
o The weighted average life of the Class A-4 Senior Notes is
determined by (a) multiplying the amount of each distribution in
reduction of principal balance by the number of years from the
Closing Date to the related Payment Date, (b) adding the results
and (c) dividing the sum by the aggregate distributions in
reduction of principal balance referred to in clause (a).
NOTE FACTORS AND TRADING INFORMATION
The "Note Factor" for the Senior Notes will be a seven-digit decimal
that the Administrative Agent will compute for each Payment Date, which will
represent the remaining outstanding principal balance of the Senior Notes as of
that Payment Date, after giving effect to payments made on the Payment Date,
expressed as a fraction of the initial outstanding principal balance of the
Senior Notes. The Note Factor will initially be 1.0000000, and will thereafter
decline to reflect reductions in the Senior Note Balance. A Senior Noteholder's
portion of the principal balance of the Senior Notes, will be the product of (a)
the original denomination of the Senior Notes and (b) the applicable Note
Factor.
On each Payment Date, the Indenture Trustee will provide to Cede & Co.
("Cede") as the nominee of The Depository Trust Company ("DTC") (unless
Definitive Notes are issued under the limited circumstances described herein),
unaudited reports concerning payments received on or in respect of the Specified
Leases and the Specified Vehicles, the Note Factor for the Senior Notes, and
various other items of information. Senior Note Owners may obtain copies of the
reports upon a request in writing to the Indenture Trustee at its Corporate
Trust Office. In addition, Senior Noteholders will be furnished information for
tax reporting purposes during each calendar year, not later than the latest date
permitted by law. For further details concerning information furnished to Senior
Noteholders and Senior Note Owners, see "Certain Information Regarding the
Securities--Statements to Senior Noteholders" and "Description of the Senior
Notes-- Book-Entry Registration".
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<PAGE> 61
DESCRIPTION OF THE SENIOR NOTES
GENERAL
The Senior Notes will be issued under the Indenture. The Indenture,
together with the SUBI Trust Agreement, the Administration Agreement, the Trust
Administration Agreement, the Trust Agreement, the Program Operating Lease, the
SUBI Certificate Transfer Agreement, and the Issuer SUBI Certificate Transfer
Agreement, are called the "Basic Documents". The following summaries of the
material provisions of the Basic Documents and the summaries of material
provisions included under "The SUBIs", "The Origination Trust", "The Specified
Leases--Characteristics of the Specified Leases", "--General" and
"--Representations, Warranties and Covenants", "Security for the Securities" and
"Additional Document Provisions" do not purport to be complete and are subject
to, and qualified in their entirety by reference to, the provisions of those
documents. Where particular provisions of or terms used in a Basic Document are
referred to, the actual provisions, including definitions of terms, are
incorporated by reference as part of those summaries. Copies of the Basic
Documents may be obtained by request to the Transferor at the address set forth
under "The Transferor".
The Senior Notes will be issued in minimum denominations of $1,000 and
integral multiples of $1,000 in excess thereof in book-entry form. The Senior
Notes initially will be represented by certificates registered in the name of
Cede, the nominee of DTC. No Senior Note Owner will be entitled to receive a
certificate representing that owner's Senior Note, except as set forth below.
Unless and until Senior Notes are issued in fully registered certificated form
(the "Definitive Notes") under the limited circumstances described below, all
references herein to distributions, notices, reports and statements to Senior
Noteholders will refer to the same actions made with respect to DTC or Cede, as
the case may be, for the benefit of Senior Note Owners in accordance with DTC
procedures. See "--Book-Entry Registration" and "Certain Information Regarding
the Securities--Definitive Notes".
Distributions in respect of the Subordinated Notes and the Certificates
will be subordinated to distributions in respect of the Senior Notes to the
extent described under "Certain Information Regarding the Securities--Payments
on the Securities".
INTEREST
Interest on the unpaid principal balance of the Senior Notes will be
paid in quarterly installments on the first Business Day after the 14th day of
each January, April, July and October, beginning January 17, 2000 (each, a
"Payment Date") to holders of record of the Senior Notes (the "Senior
Noteholders") as of the day immediately preceding the Payment Date (each such
date, a "Record Date"), with the final interest payment due on the earlier of
(a) the Payment Date on which the principal balance of the Senior Notes is
reduced to zero or (b) the Final Payment Date. A "Business Day" will be any day
other than a Saturday, a Sunday or a day on which banking institutions in the
states of Delaware, Florida, Illinois or New York are authorized or obligated by
law, executive order or government decree to be closed.
Interest will accrue on each class of Senior Notes at the interest rate
specified for each class on the front cover of this prospectus (each, an
"Interest Rate"), from and including the Closing Date, or from and including the
15th day of the month in which the preceding Payment Date occurred to and
including the 14th day of the month in which the Payment Date occurs (each, an
"Accrual Period") at the applicable Interest Rate until the principal amount of
the
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<PAGE> 62
Senior Notes has been paid in full. Interest on the Class A-1 Senior Notes will
be calculated on the basis of the actual number of days elapsed, but assuming a
360-day year. Interest on the other classes of Senior Notes will be calculated
on the basis of a 360-day year consisting of twelve 30-day months.
As more fully described under "Certain Information Regarding the
Securities--Payments on the Securities", interest payments on the Senior Notes
on a Payment Date generally will be made from the sum of:
o Available Funds remaining after the Administrative Agent has been
paid the Payment Date Advance Reimbursement and the Administration
Fee, and
o the Reserve Fund Draw Amount, if any.
PRINCIPAL
Securityholders are entitled to receive on each Payment Date an amount
(the "Principal Distribution Amount") equal to the greater of (a) the sum of (1)
the Optimal Principal Distribution Amount and (2) any Principal Carryover
Shortfall as of the preceding Payment Date, and (b) if the amount on deposit in
the Reserve Fund after giving effect to all deposits and withdrawals referenced
in clause (a) of the definition of the Reserve Fund Draw Amount as more fully
described under "Security for the Securities--The Accounts--The Reserve Fund",
exceeds the unpaid principal amount of the Securities, the unpaid principal
amount of the Securities (the "Securities Balance"). Notwithstanding the
foregoing, the Principal Distribution Amount shall not exceed the Securities
Balance.
The funds available to make principal distributions on a Payment Date
(the "Available Principal Distribution Amount") will equal the sum of (a) the
amount of Available Funds remaining after the Administrative Agent has been paid
the Payment Date Advance Reimbursement and the Administration Fee, and after
accrued interest has been paid on the Securities and (b) the Reserve Fund Draw
Amount remaining after accrued interest has been paid on the Securities.
Principal payments will be made to Securityholders in the priority set forth
below on each Payment Date in an amount equal to the lesser of (a) the Principal
Distribution Amount and (b) the Available Principal Distribution Amount (the
"Quarterly Principal Distributable Amount").
"Principal Carryover Shortfall" will mean, as of the close of any
Payment Date, the sum of the excess, if any, of the then Principal Distribution
Amount over the Quarterly Principal Distributable Amount.
On each Payment Date, unless the maturity of the Senior Notes has been
accelerated following an Indenture Default, principal payments shall be made
sequentially so that no principal will be paid on any class of Senior Notes
until each class of Senior Notes with a lower numerical designation shall have
been paid in full. Thus no principal will be paid on the Class A-2 Senior Notes
until the principal on the Class A-1 Senior Notes shall have been paid in full.
No principal will be paid on the Class A-3 Senior Notes until the principal on
the Class A-2 Senior Notes shall have been paid in full. No principal will be
paid on the Class A-4 Senior Notes until the principal on the Class A-3 Senior
Notes shall have been paid in full. Until all principal due to the Senior Notes
is paid, no principal will be paid to the Subordinated Notes and the
Certificates. Any remaining principal payment will then be paid first to the
subordinated
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notes until they have been paid in full -- which amounts will be deposited into
the Reserve Fund until the Reserve Fund is fully funded -- and then to the
certificates.
On any Payment Date, (a) the "Senior Note Balance" and the "Certificate
Balance" will equal the Initial Senior Note Balance or the Initial Certificate
Balance, as the case may be, reduced by all payments of principal made on or
prior to the Payment Date on the Senior Notes or the Certificates, as the case
may be, and (b) the "Subordinated Note Balance" will equal the Initial
Subordinated Note Balance, reduced by all payments of principal made on or prior
to the Payment Date, whether paid to the Subordinated Noteholder or deposited in
the Reserve Fund.
On each Payment Date after the maturity of the Senior Notes has been
accelerated following an Indenture Default, principal will be allocated, first,
pro rata among all outstanding classes of Senior Notes, second, to the
Subordinated Notes, and third, to the Certificates. See "Certain Information
Regarding the Securities--Payments on the Securities" and "Additional Document
Provisions--The Indenture--Indenture Defaults".
The "Optimal Principal Distributable Amount" for any Payment Date and
the related Collection Period will equal the sum of the following amounts:
o for each Specified Vehicle for which the related Specified Lease did
not terminate during that Collection Period, the difference between
the Securitization Value of the Specified Lease at the beginning and
at the end of that Collection Period;
o for each Specified Vehicle for which the related Specified Lease
reached its Maturity Date during that Collection Period, the
Securitization Value of the Specified Lease as of the Maturity Date;
o for each Specified Lease terminated by the Obligor or the
Administrative Agent during that Collection Period pursuant to
exercise of the Annual Termination Option, the Securitization Value
of such Specified Lease as of the effective date of termination;
o for each Specified Vehicle purchased by the Administrative Agent
before its Maturity Date, the Securitization Value of the related
Specified Lease as of the date of the purchase;
o for each Specified Vehicle relating to a Specified Lease that became
a Casualty Termination Lease during that Collection Period, the
Securitization Value of the Specified Lease as of the date the
Specified Lease became a Casualty Termination Lease; and
o for each Specified Lease that became a Default Termination Lease
during that Collection Period, the Securitization Value of the
Specified Lease as of the date the Specified Lease became a Default
Termination Lease.
A "Casualty Termination Lease" will mean a Specified Lease that
terminated because the related Specified Vehicle has been lost, stolen or
damaged beyond economic repair.
A "Default Termination Lease" will mean a Specified Lease terminated by
(a) the Administrative Agent following a default by or bankruptcy of the related
Obligor; or (b) the Obligor -- other than by exercising the Annual Termination
Option -- based on an alleged breach
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by the Maintenance Provider under the Specified Lease, which Specified Lease and
the related Specified Vehicle shall no longer be a SUBI Asset, but shall be
reallocated to the UTI.
The principal amount of the Senior Notes, to the extent not paid, will
be due on the Final Payment Date. The actual date on which the Senior Note
Balance is paid may be earlier than the Final Payment Date based on a variety of
factors, including the factors described under "Risk Factors -- The timing of
principal payments is uncertain" and "Maturity, Payment and Yield
Considerations".
OPTIONAL PURCHASE
The Senior Notes may be redeemed in whole, but not in part, on any
Payment Date when an Optional Purchase can be exercised. The redemption price
will equal the Senior Note Balance plus accrued interest thereon at the Interest
Rate. See "Certain Information Regarding the Securities--Optional Purchase".
THE INDENTURE TRUSTEE
U.S. Bank will be the Indenture Trustee under the Indenture. The
Indenture Trustee is a national banking association and its Corporate Trust
Office is located at One Illinois Center, 111 East Wacker Drive, Suite 3000,
Chicago, Illinois 60601. The fees and expenses of the Indenture Trustee will be
paid by the Administrative Agent or the Administrator. See "Additional Document
Provisions--Miscellaneous Provisions--Fees and Expenses". The Transferor, the
Administrative Agent and their respective affiliates may maintain normal
commercial banking relationships with the Indenture Trustee and its affiliates.
BOOK-ENTRY REGISTRATION
The Senior Notes will be issued in book-entry form. DTC will act as
securities depository for the Senior Notes. The Senior Notes will be issued as
fully registered securities registered in the name of Cede, the nominee of DTC.
An investor acquiring an interest in the Senior Notes (each, a "Senior Note
Owner") may hold its interest through DTC in the United States, or Cedelbank
("Cedelbank") or the Euroclear system ("Euroclear") in Europe, which in turn
hold through DTC. One fully registered Senior Note will be issued with respect
to each $200 million in principal amount of Senior Notes or such smaller amount
as necessary. It is anticipated that the only Senior Noteholder will be Cede,
the nominee of DTC. Senior Note Owners will not be recognized by the Indenture
Trustee as "Senior Noteholders", as that term will be used in the Indenture, and
Senior Note Owners will only be permitted to exercise the rights of Senior
Noteholders indirectly through DTC and its Participants, as further described
below.
DTC was created to hold securities for its participating members (the
"Participants") and to facilitate the clearance and settlement of securities
transactions between Participants through electronic book-entry changes in
accounts of its Participants, thereby eliminating the need for physical movement
of certificates. DTC is:
o a limited-purpose trust company organized under the laws of the
State of New York,
o a "banking organization" within the meaning of the New York Banking
Law,
o a member of the Federal Reserve System,
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o a "clearing corporation" within the meaning of the Uniform
Commercial Code (the "UCC") in effect in the State of New York, and
o a "clearing agency" registered pursuant to the provisions of Section
17A of the Exchange Act.
Participants include securities brokers and dealers, including the Initial
Purchaser, banks, trust companies and clearing corporations. Indirect access to
the DTC system also is available to banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a Participant,
either directly or indirectly (the "Indirect Participants"). Transfers between
Participants in DTC will occur in accordance with DTC rules. The rules
applicable to DTC and its Participants are on file with the SEC.
Cedelbank and the Euroclear will hold omnibus positions on behalf of
their Participants through customers' securities accounts in the Depositaries
which will in turn will hold such positions in customers' securities accounts in
DTC through Citibank, N.A. or Morgan Guaranty Trust Company of New York, the
relevant depositaries (collectively, the "Depositaries") of Cedelbank or
Euroclear, respectively, and each a participating member of DTC. Transfers
between Participants in Cedelbank ("Cedelbank Participants") and Participants in
Euroclear ("Euroclear Participants") will occur in accordance with their
respective rules and operating procedures.
Cross-market transfers between persons holding directly or indirectly
through DTC, on the one hand, and directly or indirectly through Cedelbank
Participants or Euroclear Participants, on the other, will be effected in DTC in
accordance with DTC rules on behalf of Cedelbank or Euroclear by its Depositary.
However, each such cross-market transaction will require delivery of
instructions to Cedelbank or Euroclear by the counterparty in such system in
accordance with its rules and procedures and within its established deadlines
(European time). Cedelbank or Euroclear will, if the transaction meets its
settlement requirements, deliver instructions to its Depositary to take action
to effect final settlement on its behalf of delivering or receiving securities
in DTC, and making or receiving payment in accordance with normal procedures for
same-day funds settlement applicable to DTC. Cedelbank Participants and
Euroclear Participants may not deliver instructions directly to the related
Depositaries.
Because of time-zone differences, credits of securities received in
Cedelbank or Euroclear as a result of a transaction with a DTC Participant will
be made during subsequent securities settlement processing and dated the
business day following the DTC settlement date. Such credits or any transactions
in such securities settled during such processing will be reported to the
relevant Cedelbank Participants or Euroclear Participants on such business day.
Cash received in Cedelbank or Euroclear as a result of sales of Senior Notes by
or through a Cedelbank Participant or Euroclear Participant to a DTC Participant
will be received with value on the DTC settlement date but will be available in
the relevant Cedelbank or Euroclear cash account only as of the business day
following settlement in DTC.
Senior Note Owners that are not Participants or Indirect Participants
but desire to purchase, sell or otherwise transfer ownership of, or an interest
in, Senior Notes may do so only through Participants and Indirect Participants.
Participants will receive a credit for the Senior Notes on DTC's records. The
ownership interest of each Senior Note Owner will in turn be recorded on the
respective records of Participants and Indirect Participants. Senior Note Owners
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<PAGE> 66
will not receive written confirmation from DTC of their purchase of Senior
Notes, but Senior Note Owners are expected to receive written confirmations
providing details of the transaction, as well as periodic statements of their
holdings, from the Participant or Indirect Participant through which the Senior
Note Owner entered into the transaction. Transfers of ownership interests in the
Senior Notes will be accomplished by entries made on the books of Participants
acting on behalf of Senior Note Owners.
To facilitate subsequent transfers, all Senior Notes deposited by
Participants with DTC will be registered in the name of Cede, the nominee of
DTC. The deposit of Senior Notes with DTC and their registration in the name of
Cede will not change the beneficial ownership of the Senior Notes. DTC will have
no knowledge of the actual Senior Note Owners and its records will reflect only
the Participants to whose accounts those Senior Notes are credited, which may or
may not be the Senior Note Owners. Participants and Indirect Participants will
remain responsible for keeping account of their holdings on behalf of their
customers.
Conveyance of notices and other communications by DTC to Participants,
by Participants to Indirect Participants and by Participants and Indirect
Participants to Senior Note Owners will be governed by arrangements among them,
subject to any statutory or regulatory requirements as may be in effect from
time to time.
DTC's practice is to credit Participants' accounts on each Payment Date
in accordance with their respective holdings of Senior Notes shown on DTC's
records unless DTC has reason to believe that it will not receive payment on
that Payment Date. Payments by Participants and Indirect Participants to Senior
Note Owners will be governed by standing instructions and customary practices,
as is the case with securities held for the accounts of customers in bearer form
or registered in "street name". These payments will be the responsibility of the
Participants and not of DTC, the Indenture Trustee or the Transferor, subject to
any statutory or regulatory requirements as may be in effect from time to time.
Payment of principal of and interest on the Senior Notes to DTC will be the
responsibility of the Indenture Trustee, disbursement of the payments to
Participants will be the responsibility of DTC and disbursement of the payments
to Senior Note Owners will be the responsibility of Participants and Indirect
Participants. As a result, under the book-entry format, Senior Note Owners may
experience some delay in their receipt of payments. DTC will forward the
payments to its Participants, which will then forward them to Indirect
Participants or Senior Note Owners.
Because DTC can only act on behalf of Participants, who in turn act on
behalf of Indirect Participants and certain banks, the ability of a Senior Note
Owner to pledge Senior Notes to persons or entities that do not participate in
the DTC system, or otherwise take actions with respect to the Senior Notes, may
be limited due to the lack of a physical certificate for the Senior Notes.
DTC management is aware that some computer applications and systems
used for processing data were written using two digits rather than four to
define the applicable year, and therefore may not recognize a date using "00" as
the year 2000. This could result in "Year 2000" problems, such as the inability
of these systems to properly process transactions with dates in the year 2000
and thereafter. DTC has developed and is implementing a program to address this
issue so that its applications and systems relating to the payment of
distributions -- including principal and income payments -- to securityholders,
book-entry deliveries and settlement of trades within DTC continue to function
properly. This program includes a technical assessment
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<PAGE> 67
and a remediation plan, each of which is complete. DTC plans to implement a
testing phase of this program which is expected to be completed within
appropriate time frames.
In addition, DTC is contacting and will continue to contact third party
vendors that provide services to DTC to determine the extent of their Year 2000
compliance, and DTC will develop contingency plans as it deems appropriate to
address failures in Year 2000 compliance on the part of third party vendors.
However, there can be no assurance that the systems of third party vendors will
be timely converted and will not adversely affect the proper functioning of
DTC's services.
The information set forth in the preceding two paragraphs has been
provided by DTC for informational purposes only and is not intended to serve as
a representation, warranty or contract modification of any kind. The Trust makes
no representations as to the accuracy or completeness of this information.
If the DTC Systems are not made year 2000 compliant on a timely basis,
DTC's ability to provide DTC services, including payments on the Notes may be
materially and adversely affected. If this were to occur, Senior Note Owners
could experience delays in payments due or may not ultimately receive all
interest and principal due to the Senior Note Owners.
Neither DTC nor Cede will consent or vote with respect to the Senior
Notes. Under its usual procedures, DTC will mail an omnibus proxy to the
Indenture Trustee as soon as possible after each applicable record date for such
a consent or vote. The omnibus proxy will assign Cede's consenting or voting
rights to those Participants who have Notes credited to their accounts with the
Participants on that record date. These Participants will be identified in a
listing attached to the omnibus proxy.
Cedelbank is incorporated under the laws of Luxembourg as a
professional depository. Cedelbank holds securities for Cedelbank Participants
and facilitates the clearance and settlement of securities transactions between
Cedelbank Participants through electronic book-entry changes in accounts of
Cedelbank Participants, thereby eliminating the need for physical movement of
certificates. Transactions may be settled in Cedelbank in any of 34 currencies,
including United States dollars. Cedelbank provides to Cedelbank Participants,
among other things, services for safekeeping, administration, clearance and
settlement of internationally traded securities and securities lending and
borrowing. Cedelbank interfaces with domestic markets in several countries. As a
professional depositary, Cedelbank is subject to regulation by the Luxembourg
Monetary Institute. Cedelbank Participants are recognized financial institutions
around the world, including underwriters, securities brokers and dealers, banks,
trust companies, clearing corporation and certain other organizations. Indirect
access to Cedelbank is also available to others, such as banks, brokers, dealers
and trust companies that clear through or maintain a custodial relationship with
a Cedelbank Participant, either directly or indirectly.
Euroclear was created in 1968 to hold securities for Euroclear
Participants and to clear and settle transactions between Euroclear Participants
through simultaneous electronic book-entry delivery against payment, thereby
eliminating the need for physical movement of certificates and any risk from
lack of simultaneous transfers of securities and cash. Transactions may now be
settled in any of 34 currencies, including United States dollars. The Euroclear
System includes various other services, including securities lending and
borrowing, and interfaces with domestic markets in more than 25 countries
generally similar to the arrangements
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for cross-market transfers with DTC described above. Euroclear is operated by
the Brussels, Belgium office of Morgan Guaranty Trust Company of New York (the
"Euroclear Operator"), under contract with Euroclear Clearance System S.C., a
Belgian cooperative corporation (the "Cooperative"). All operations are
conducted by the Euroclear Operator, and all Euroclear securities, clearance
accounts, and Euroclear cash accounts, are accounts with the Euroclear Operator,
not the Cooperative. The Cooperative Board establishes policy for the Euroclear
System. Euroclear Participants include banks, including central banks,
securities brokers and dealers and other professional financial intermediaries.
Indirect access to the Euroclear System is also available to other firms that
clear through or maintain a custodial relationship with a Euroclear Participant,
either directly or indirectly.
The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. As such, it is
regulated and examined by the Board of Governers of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.
Securities clearance accounts and cash accounts with the Euroclear
Operator are governed by the Terms and Conditions Governing use of Euroclear and
the related Operating Procedures of the Euroclear System and applicable Belgian
law (collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawals of securities and
cash from Euroclear and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
The Euroclear Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants, and has no record of or relationship with persons
holding through Euroclear Participants.
Distributions with respect to Senior Notes held through Cedelbank or
Euroclear will be credited to the cash accounts of Cedelbank Participants or
Euroclear Participants in accordance with the relevant system's rules and
procedures, to the extent received by its Depositary. Such distributions will be
subject to tax reporting and withholding in accordance with relevant United
States tax laws and regulations. For further information in this regard, see
"Certain Federal Income Tax Consequences--Senior Notes--Tax Consequences to
Foreign Investors" herein and "Global Clearance, Settlement and Tax
Documentation Procedures--Certain U.S. Federal Income Tax Documentation
Requirements" in Annex I hereto. Cedelbank or the Euroclear Operator, as the
case may be, will take any other action permitted to be taken by a Senior
Noteholder on behalf of a Cedelbank Participant or Euroclear Participant only in
accordance with its relevant rules and procedures and subject to the related
Depositary's ability to effect such actions on its behalf through DTC.
Although DTC, Cedelbank and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of Senior Notes among Participants
of DTC, Cedelbank and Euroclear, they are under no obligation to perform or
continue to perform such procedures and the procedures may be discontinued at
any time.
None of the Administrative Agent, the Transferor, the Administrator or
the Indenture Trustee will have any liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests of the
Senior Notes held by Cede, DTC, Cedelbank or Euroclear, or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
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CERTAIN INFORMATION REGARDING THE SECURITIES
PAYMENTS ON THE SECURITIES
GENERAL
As more fully described under "Summary--Credit Enhancement--The SUBI
Certificates", the SUBI Interest evidenced by the SUBI Certificates will
evidence a 99% beneficial interest in the SUBI Assets, which comprise Specified
Vehicles and Specified Leases having an aggregate Cutoff Date Securitization
Value of $___________. The Retained SUBI Interest evidenced by the Retained SUBI
Certificates will evidence a 1% beneficial interest in the SUBI Assets and will
be permanently retained by Ryder II LP. Accordingly, Ryder II LP will be
entitled to receive 1% of all payments made on or in respect of the SUBI Assets
and will share in 1% of all losses and liabilities incurred with respect to the
SUBI Assets. Any payments made in respect of the Retained SUBI Interest will not
be available to make Program Operating Lease Payments or payments on the Senior
Notes.
On the tenth calendar day of each month in which a Payment Date occurs
or, if such day is not a Business Day, the immediately succeeding Business Day
(each, a "Determination Date"), the Administrative Agent will inform the
Indenture Trustee and the Owner Trustee of, among other things, the amount of
(a) Collections, (b) Advances to be made by the Administrative Agent and (c) the
Administration Fee payable to the Administrative Agent, in each case with
respect to the three-month period immediately preceding the month in which the
Payment Date occurs (the "Collection Period"). On or before each Determination
Date, the Administrative Agent will also determine the Optimal Principal
Distributable Amount and, based on Available Funds and other amounts available
for distribution on the related Payment Date as described below, the amount to
be distributed to the Securityholders.
The Indenture Trustee and the Owner Trustee will make distributions to
the Securityholders out of amounts on deposit in the related Distribution
Accounts. The amount to be distributed to the Administrative Agent and the
Securityholders will be determined in the manner described below.
DETERMINATION OF AVAILABLE FUNDS
The amount of funds available for distribution on a Payment Date will
generally equal the sum of Available Funds and the Reserve Fund Draw Amount.
On each Payment Date, the sum of (a) 1% of Collections for the related
Collection Period and (b) 1% of the Residual Value Surplus Draw Amount for the
related Collection Period (the "Retained Certificate Distribution Amount") will
be due the Retained Certificateholder representing amounts owed in respect of
the Retained SUBI Certificates and will not be available to make Program
Operating Lease Payments or payments on the Senior Notes.
"Available Funds" for a Payment Date and the related Collection Period
will equal the sum of the following amounts: (a) 99% of Collections, (b)
Advances required to be made by the Administrative Agent, (c) 99% of the
Residual Value Surplus Draw Amount and (d) in the case of an Optional Purchase,
the Optional Purchase Price.
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The "Available Funds Shortfall Amount" for a Payment Date and the
related Collection Period will equal the amount by which Available Funds is less
than the amount necessary to make the distributions in clauses (c) through (f)
of the first paragraph under "--Deposits to the Distribution Accounts; Priority
of Payments", except that the Optimal Principal Distributable Amount rather than
the Quarterly Principal Distributable Amount will be used for purposes of clause
(f).
DEPOSITS TO THE DISTRIBUTION ACCOUNTS; PRIORITY OF PAYMENTS
SUBI COLLECTION ACCOUNT. On each Payment Date, after taking into
account the distribution of amounts to be paid to the Retained SUBI
Certificateholder on the related Payment Date, the Administrative Agent will
allocate amounts on deposit in the SUBI Collection Account with respect to the
related Collection Period as described below and will instruct the Origination
Trustee, acting through the Trust Agent, to cause the following deposits and
distributions to be made in the following amounts and order of priority:
(a) to the Administrative Agent, the Payment Date Advance
Reimbursement;
(b) to the Administrative Agent, the Administration Fee;
(c) to the Note Distribution Account, to pay interest due on the
outstanding Senior Notes on that Payment Date, and, to the extent
permitted under applicable law, interest on any overdue interest at
the Interest Rate;
(d) to the Reserve Fund, an amount equal to the interest due on the
outstanding Subordinated Notes on that Payment Date, and, to the
extent permitted under applicable law, interest on any overdue
interest at the Subordinated Note Rate;
(e) to the Certificate Distribution Account, an amount equal to the
interest accrued on the Certificates with respect to that Payment
Date, and, to the extent permitted under applicable law, interest
on any overdue interest at the Certificate Rate;
(f) to the related Distribution Account or, in the case of the
Subordinated Notes, to the Reserve Fund, the Quarterly Principal
Distributable Amount, which will be allocated to pay principal on
the Senior Notes, the Subordinated Notes and the Certificates in
the amounts and order of priority described under "Description of
the Senior Notes--Principal"; and
(g) to the Reserve Fund, all remaining amounts (the "Excess Amounts").
RESERVE FUND. On each Payment Date, after taking into account amounts
available to be distributed to Securityholders from the SUBI Collection Account,
the Administrative Agent will allocate the Reserve Fund Draw Amount on deposit
in the Reserve Fund with respect to the related Collection Period and will
instruct the Indenture Trustee to make the following deposits and distributions
in the following amounts and order of priority:
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(a) to the Note Distribution Account, to pay any remaining interest due
on the outstanding Senior Notes on that Payment Date, and, to the
extent permitted under applicable law, interest on any overdue
interest at the Interest Rate;
(b) to the Reserve Fund, an amount equal to any remaining interest due
on the outstanding Subordinated Notes on that Payment Date, and, to
the extent permitted under applicable law, interest on any overdue
interest at the Subordinated Note Rate;
(c) to the Certificate Distribution Account, an amount equal to any
remaining interest accrued on the Certificates with respect to that
Payment Date, and, to the extent permitted under applicable law,
interest on any overdue interest at the Certificate Rate; and
(d) to the related Distribution Account - or, in the case of the
Subordinated Notes, to the Reserve Fund, and thereafter, in the
event of any remaining shortfall in amounts required to pay the
Quarterly Principal Distributable Amount with respect to the
Certificates, to the Certificate Distribution Account - the
remaining Quarterly Principal Distributable Amount, which will be
allocated to pay principal on the Securities in the amounts and
order of priority described under "Description of the Senior
Notes--Principal".
On each Payment Date, if, after the giving effect to the distributions
set forth above, the amount on deposit in the Reserve Fund exceeds the Reserve
Fund Requirement, any such excess (a) up to the amounts deposited into the
Reserve Fund on or before that Payment Date in respect of the Subordinated Notes
will be released to the Transferor as the Subordinated Noteholder and (b) any
additional excess shall be released to the Transferor.
The "Payment Date Advance Reimbursement" for a Payment Date will equal
the sum of all outstanding (a) Sales Proceeds Advances (1) in respect of
Specified Vehicles that were sold during the related Collection Period and (2)
that have been outstanding as of the end of that Collection Period for at least
270 days and (b) Financial Component Advances as to which the related Obligor
has made all or a portion of the advanced Total Monthly Payment or that have
been outstanding as of the end of the Collection Period for at least 180 days.
Amounts deposited in the Reserve Fund in accordance with clause (d) in
the first paragraph under "--SUBI Collection Account" and clause (b) under
"--Reserve Fund" will be deemed to have been distributed to the Subordinated
Noteholder as payments in respect of interest, including overdue interest, and
the Subordinated Noteholder will not be entitled to any further interest on such
amounts after the related Payment Date.
The final distribution to any Senior Noteholder will be made only upon
surrender and cancellation of the certificate representing its Senior Notes at
an office or agency of the Trust specified in the notice of termination. Any
funds remaining in the Trust, after the related Trustee has taken certain
measures to locate the related Senior Noteholders and those measures have
failed, will be distributed to the Administrative Agent.
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OPTIONAL PURCHASE
In order to avoid excessive administrative expenses, the Transferor
will be permitted at its option to purchase from the Trust the Vehicle SUBI
Certificate and SUBI Interest evidenced thereby, and to terminate the pledge of
the Lease SUBI Certificate and the SUBI Interest evidenced thereby, on any
Payment Date if, either before or after giving effect to any payment of
principal required to be made on that Payment Date, the Securities Balance is
less than or equal to 10% of the sum of the Initial Senior Note Balance, the
Initial Certificate Balance and the Initial Subordinated Note Balance
(collectively, the "Initial Securities Balance"). The exercise of that option by
the Transferor is referred to in this prospectus as an "Optional Purchase". The
purchase price for the Vehicle SUBI Certificate and the termination of the
pledge of the Lease SUBI Certificate will equal the Securities Balance, together
with accrued interest thereon to the date fixed for redemption (the "Optional
Purchase Price"), which will be deposited by the Transferor into the SUBI
Collection Account on the Deposit Date related to the Payment Date fixed for
redemption. In connection with an Optional Purchase, the Senior Notes will be
redeemed on that Payment Date in whole, but not in part, for the Redemption
Price. The "Redemption Price" for the Senior Notes will equal the Senior Note
Balance, plus accrued and unpaid interest thereon at the related Interest Rates,
to but not including the Payment Date fixed for redemption. The Administrator or
the Trust will provide at least 45 days' prior notice of the redemption of the
Senior Notes to the Indenture Trustee, which will provide at least 30 days'
notice to the Senior Noteholders. On the Payment Date fixed for redemption, the
Senior Notes will be due and payable at the Redemption Price, and no interest
will accrue on the Senior Notes after the Payment Date.
STATEMENTS TO SENIOR NOTEHOLDERS
On each Payment Date, the Indenture Trustee or the Owner Trustee, as
the case may be, will include with each distribution to each Senior Noteholder
of record, or as of the close of business on the related Record Date -- which,
in the case of the Senior Notes, shall be Cede as the nominee of DTC unless
Definitive Notes are issued under the limited circumstances described in this
prospectus -- and each Rating Agency, a statement, setting forth with respect to
that Payment Date or the related Deposit Date or Collection Period, as the case
may be, among other things, the following:
(a) the amount of Collections allocable to each of the SUBI
Certificates and the Retained SUBI Certificates for that Collection
Period;
(b) the amount being distributed to the Senior Noteholders (the "Senior
Note Distribution Amount");
(c) the amount of the Senior Note Distribution Amount allocable to
interest on and principal of the Senior Notes, and any Principal
Carryover Shortfall for the Senior Notes, the Subordinated Notes
and the Certificates, respectively;
(d) the amount of Available Funds for that Collection Period;
(e) the amount of Sales Proceeds Advances and Financial Component
Advances included in Available Funds;
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(f) the amount of Residual Value Losses and Residual Value Surplus for
that Collection Period and the Residual Value Surplus Draw Amount,
if any, included in Available Funds, after giving effect to the
Retained Certificate Distribution Amount;
(g) the Reserve Fund Draw Amount, if any, the balance on deposit in the
Reserve Fund on that Payment Date after giving effect to
withdrawals therefrom and deposits thereto in respect of that
Payment Date and the change in that balance from the immediately
preceding Payment Date;
(h) the aggregate outstanding principal balance of the Senior Notes,
the Subordinated Notes and the Certificates;
(i) the Note Factor for the Senior Notes after giving effect to the
distribution of the Senior Note Distribution Amount;
(j) the amount of Special Event Purchases made during that Collection
Period and the aggregate Cutoff Date Securitization Value of all
Specified Leases relating to Special Event Purchases made (a)
during the related calendar year or (b) since the Closing Date;
(k) the Payment Date Advance Reimbursement; and
(l) the Administration Fee.
Each amount set forth pursuant to clauses (b), (c), (h) and (k) above
will be expressed in the aggregate and as a dollar amount per $1,000 of original
principal balance of a Senior Note, Subordinated Note or Certificate, as
applicable. Copies of the statements may be obtained by Senior Noteholders or
Senior Note Owners by a request in writing addressed to the Indenture Trustee.
In addition, within the prescribed period of time for tax reporting purposes
after the end of each calendar year, the Indenture Trustee -- during the term of
the Indenture -- will mail to each person who at any time during that calendar
year was a Senior Noteholder a statement containing that information as is
reasonably necessary to permit the Noteholder to prepare its state and federal
income taxes.
DEFINITIVE NOTES
Definitive Notes will be issued in fully registered,
certificated form to Senior Note Owners rather than to DTC only if:
o DTC is no longer willing or able to discharge its responsibilities
as depository with respect to the Senior Notes, and neither the
Indenture Trustee nor the Transferor is able to locate a qualified
successor,
o the Transferor, at its option, elects to terminate the book-entry
system through DTC, or
o after an Indenture Default, Senior Note Owners representing in the
aggregate not less than 51% of the aggregate principal amount of the
Senior Notes advise the Indenture Trustee through DTC and its
Participants in writing that the continuation of a book-entry system
through DTC or its successor is no longer in the best interest of
Senior Note Owners.
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Upon the occurrence of any of the events described in the immediately
preceding paragraph, the Indenture Trustee will be required to notify all Senior
Note Owners, through Participants, of the availability through DTC of Definitive
Notes. Upon surrender by DTC of the certificates representing all Senior Notes
and the receipt of instructions for re-registration, the Indenture Trustee will
issue Definitive Notes to Senior Note Owners, who thereupon will become Senior
Noteholders for all purposes of the Indenture.
Payments on the Definitive Notes will be made by the Indenture Trustee
or the Owner Trustee, as the case may be, directly to the holders of the
Definitive Notes in accordance with the procedures set forth in this prospectus
and to be set forth in the Indenture. Interest and principal payments on the
Securities on each Payment Date will be made to the holders in whose names the
related Definitive Notes were registered at the close of business on the Record
Date with respect to that Payment Date. Payments will be made by check mailed to
the address of such holders as they appear on the Note Register. However, the
final payment on any Definitive Notes, or if Definitive Notes have not been
issued, certificates registered in the name of Cede representing the Senior
Notes, will be made only upon presentation and surrender of the Definitive Notes
at the office or agency specified in the notice of final payment to Senior
Noteholders. The Indenture Trustee or the Owner Trustee, as the case may be, or
a paying agent will provide that notice to the registered Senior Noteholders not
more than 30 days or less than 15 days prior to the date on which the final
payment is expected to occur.
Definitive Notes will be transferable and exchangeable at the offices
of the Indenture Trustee or the Owner Trustee or the Note Registrar to be set
forth in the Indenture. No service charge will be imposed for any registration
of transfer or exchange, but the Indenture Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge imposed in connection
therewith.
SECURITY FOR THE SECURITIES
GENERAL
The property of the Trust -- the Trust Estate -- will consist of:
o the right to receive payments under the Program Operating Lease
under which the Trust will lease to the Transferor the Vehicle
SUBI Certificate and the SUBI Interest evidenced thereby, which
is more fully described under "The SUBIs--General";
o the pledge by the Transferor of the Lease SUBI Certificate as
security for such payments;
o the right to receive 99% of the amounts realized from sales of
Specified Vehicles;
o certain rights to payment from the Reserve Fund and the Residual
Value Surplus Account; and
o the other property and assets described under "The
Trust--Property of the Trust", including available amounts on
deposit in the Reserve Fund and the Trust's rights as a
third-party beneficiary of the SUBI Trust Agreement and the
Administration Agreement.
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THE PROGRAM OPERATING LEASE
GENERAL
Immediately following the sale, transfer and assignment of the Vehicle
SUBI Certificate to the Trust and the pledge to the Indenture Trustee of the
Trust's interest therein as described in "The SUBIs--Transfers of the SUBI
Certificates", the Trust and the Transferor will enter into the Program
Operating Lease pursuant to which the Trust will lease the Vehicle SUBI
Certificate to the Transferor during the term of the Program Operating Lease. As
lessee, the Transferor will be entitled to receive all proceeds from the Vehicle
SUBI Certificate in respect of the Specified Vehicles during the term of the
Program Operating Lease and will be required to make Program Operating Lease
Payments to the Trust.
PROGRAM OPERATING LEASE TERMS
Under the Program Operating Lease, the Transferor will make payments to
the Trust in the amount of (a) the Financial Component of the Fixed Charge paid
by the Obligors during the related Collection Period and (b) all Termination
Value Payments made by Obligors following the exercise of the Annual Termination
Option during the related Collection Period (the "Program Operating Lease
Payments").
The termination date of the Program Operating Lease (the "Program
Operating Lease Termination Date") will be 60 days after the latest Maturity
Date of any Specified Lease as of the Cutoff Date. Notwithstanding the Program
Operating Lease Termination Date, the Program Operating Lease will expire with
respect to each Specified Lease and the related Specified Vehicle on the
earliest to occur of:
o the related Maturity Date;
o the effective date of exercise by the Administrative Agent or
the related Obligor of the Annual Termination Option;
o the date of the Administrative Agent's termination of that
Specified Lease for other commercial reasons as described under
"Additional Document Provisions--The Administration
Agreement--Purchase of Specified Vehicles Before their Maturity
Dates";
o the date that Specified Lease becomes a Default Termination
Lease;
o the date that Specified Lease becomes a Casualty Termination
Lease; or
o the date the Administrative Agent is required to purchase that
Specified Vehicle pursuant to certain provisions of the
Administration Agreement.
PROGRAM OPERATING LEASE DEFAULTS; REMEDIES
Defaults under the Program Operating Lease (each, a "Program Operating
Lease Default") will include, among other things, the failure by the Transferor
to make timely Program Operating Lease Payments to the Trust, breach of a
material representation or warranty, failure to observe or perform certain
covenants and the occurrence of an Indenture Default. Upon the occurrence of a
Program Operating Lease Default, (a) the Indenture Trustee, as assignee of the
Trust's rights under the Program Operating Lease pursuant to the pledge of the
Trust Estate, will be entitled to terminate the Program Operating Lease and to
foreclose on the pledge of the Lease SUBI Certificate. Upon that termination,
the Trust will directly receive all distributions with respect to, or will have
the right to sell, the SUBI Certificates and to apply the funds on deposit
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in the Accounts to pay interest on and principal of the Senior Notes. Each
Program Operating Lease Default will constitute an Indenture Default, which will
permit the Senior Noteholders to accelerate the maturity of the Senior Notes
and, in some circumstances, cause the sale of the Trust Estate. See "Additional
Document Provisions--The Indenture--Indenture Defaults". If the maturity of the
Senior Notes has been accelerated following a Program Operating Lease Default,
the Indenture Trustee, as assignee of the Trust, will be entitled to demand that
the Transferor pay all previously due but as yet unpaid Program Operating Lease
Payments plus, as liquidated damages, an amount equal to the sum of:
o any interest due and unpaid on the Securities,
o the unpaid principal balance of the Securities, and
o any other amounts payable by the Transferor under the Basic
Documents.
Upon payment of such amounts, the Transferor will be entitled to receive the
SUBI Certificates.
THE SUBORDINATED NOTES
Interest will accrue on the unpaid principal amount of the Subordinated
Notes during each Accrual Period at a rate per annum (the "Subordinated Note
Rate") equal to ____%. Interest on the Subordinated Notes will be calculated on
the basis of a 360-day year consisting of twelve 30-day months. Payments of
interest on and principal of the Subordinated Notes will be subordinated to
payments on the Senior Notes to the extent described herein.
To secure payments of principal and interest on the other Securities,
the Transferor will pledge all of its right, title and interest in the
Subordinated Notes to the Trust and deliver them to the Indenture Trustee as a
portion of the Trust Estate. On each Payment Date, payments in respect of the
Subordinated Notes will be deposited into the Reserve Fund. If, on any Payment
Date, after the application of amounts required to be paid on that Payment Date,
the amount on deposit therein exceeds the Reserve Fund Requirement, (a) any such
excess up to the amounts deposited into the Reserve Fund on or before that
Payment Date in respect of the Subordinated Notes will be released to the
Transferor as the Subordinated Noteholder and (b) any additional excess shall be
released to the Transferor.
THE CERTIFICATES
Payments on the Certificates will be subordinated to payments on the
Senior Notes and the Subordinated Notes to the extent described in this
prospectus. The right of the holder of the Transferor Certificate to receive
distributions of principal and interest will rank pari passu with the rights of
the holders of the other Certificates.
Interest on the Certificates will accrue during each Accrual Period at
a rate per annum (the "Certificate Rate") equal to ___% until the principal
amount of the Certificates has been paid in full. Interest on the Certificates
will be calculated on the basis of a 360-day year consisting of twelve 30-day
months. Interest payments on the Certificates on a Payment Date generally will
be made from the sum of (1) Available Funds remaining after the Administrative
Agent has been paid the Payment Date Advance Reimbursement and the
Administration Fee and all amounts allocated to payment of interest on the
Senior Notes have been paid and (2) the Reserve Fund Draw Amount, if any,
remaining after all amounts allocated to payment of interest on the Senior Notes
have been paid.
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Principal payments will be made to Certificateholders as described
under "Description of the Senior Notes -- Principal". If not paid in full prior
to the Final Payment Date, the remaining Certificate Balance, if any, will be
payable on that Payment Date.
The Certificates will be subject to prepayment in whole, but not in
part, on any Payment Date relating to an Optional Purchase. In the event of an
Optional Purchase, the Certificateholders will receive an amount in respect of
the Certificates equal to the Certificate Balance, together with accrued
interest thereon at the Certificate Rate.
THE ACCOUNTS
THE SUBI COLLECTION ACCOUNT
On or prior to the Closing Date, the Origination Trustee will establish
a trust account for the benefit of the holders of interests in the SUBI, into
which collections on or in respect of the Specified Leases and the Specified
Vehicles will generally be deposited (the "SUBI Collection Account").
DEPOSITS INTO THE SUBI COLLECTION ACCOUNT. As more fully described
under "Additional Document Provisions--The Administration Agreement --
Collections" and "--Monthly Remittance Condition", Collections and other amounts
received on or in respect of the SUBI Assets generally will be deposited by the
Administrative Agent into the SUBI Collection Account within two days after
processing, unless the Monthly Remittance Condition is satisfied. If the Monthly
Remittance Condition is satisfied, such amounts received in respect of a Monthly
Period will be deposited into the SUBI Collection Account on the second Business
Day following the end of the related Monthly Period, or, in the case of the
Monthly Period immediately preceding the related Payment Date, the related
Deposit Date. In addition, on each Deposit Date, the following additional
amounts, if any, in respect of the related Collection Period and Payment Date
will be deposited into the SUBI Collection Account: Advances made by the
Administrative Agent, the Residual Value Surplus Draw Amount and, in the case of
an Optional Purchase, the Optional Purchase Price. Payments received in respect
of the Maintenance Component either will not be deposited into the SUBI
Collection Account or will be withdrawn from the SUBI Collection Account on a
daily basis and, in either event, will be paid to or retained by the Maintenance
Provider. See "Additional Document Provisions--The Administration
Agreement--Collections" and "--Monthly Remittance Condition".
WITHDRAWALS FROM THE SUBI COLLECTION ACCOUNT. On each Deposit Date, the
Administrative Agent shall cause the Origination Trustee to withdraw from the
SUBI Collection Account and deposit in the Residual Surplus Value Account, the
amount of Residual Value Surplus for each Specified Vehicle sold during the
related Collection Period. On each Payment Date, the Origination Trustee shall
transmit or shall cause to be transmitted:
o the sum of (1) all Available Funds for the related Collection Period
and (2) the Retained Administration Payment in the amounts and in
the priority, and to such accounts as set forth under "Certain
Information Regarding the Securities--Payments on the
Securities--Deposits to the Distribution Accounts; Priority of
Payments", and
o the excess of (1) the Retained Certificate Distribution Amount --
representing amounts payable in respect of the Retained SUBI
Interest -- for the related Collection Period over (2) 1% of the
Administration Fee for the related Collection Period (the "Retained
Administration Payment"),
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to an account specified by the holder of the Retained SUBI Certificates.
In the event that on any date the Administrative Agent supplies the
Origination Trustee and the Indenture Trustee with an officer's certificate
setting forth the basis for such withdrawal, the Origination Trustee shall remit
to the Administrative Agent or the Maintenance Provider, as the case may be,
without interest and before to any other distribution from the SUBI Collection
Account on that date, monies from the SUBI Collection Account representing (a)
payments in respect of the Maintenance Component and (b) unreimbursed
Disposition Expenses.
THE RESERVE FUND
On or before the Closing Date, the Owner Trustee will establish a trust
account in the name of the Indenture Trustee for the benefit of the
Securityholders (the "Reserve Fund"). The Reserve Fund will be established to
provide additional security for payments on the Senior Notes. On each Payment
Date, amounts on deposit in the Reserve Fund, together with Available Funds will
be available to make, the distributions described under "Certain Information
Regarding the Securities--Payments on the Securities--Deposits to the
Distribution Accounts; Priority of Payments".
The Reserve Fund initially will be funded by the Transferor with a
deposit of $__________ (the "Initial Deposit"), and the amounts on deposit in
the Reserve Fund will be pledged to the Trust. As described under "--The
Subordinated Notes", all payments made on the Subordinated Notes will be
deposited in the Reserve Fund. On each Payment Date, monies on deposit in the
Reserve Fund will be supplemented by the deposit of:
o payments of interest on and principal of the Subordinated Notes,
o any Excess Amounts, and
o income received on the investment of funds on deposit in the SUBI
Collection Account, the Residual Value Surplus Account and the
Reserve Fund.
On each Payment Date, a withdrawal will be made from the Reserve Fund
in an amount (the "Reserve Fund Draw Amount") equal to the sum of (a) the lesser
of (1) the Available Funds Shortfall Amount, calculated as described under
"Certain Information Regarding the Securities--Payments on the
Securities--Determination of Available Funds" for that Payment Date, and (2) the
amount on deposit in the Reserve Fund after giving effect to all deposits
thereto on the related Deposit Date or that Payment Date; and (b) in the event
the amount on deposit in the Reserve Fund, after giving effect to all
withdrawals therefrom and deposits thereto made on or in respect of that Payment
Date exceeds the unpaid principal balance of the Securities, the Securities
Balance.
On any Payment Date on which the amount on deposit in the Reserve Fund,
after giving effect to all withdrawals therefrom and deposits thereto in respect
of that Payment Date, exceeds the Reserve Fund Requirement, any such excess (a)
up to the amounts deposited into the Reserve Fund on or before that Payment Date
in respect of the Subordinated Notes, will be released to the Transferor as the
holder of the Subordinated Notes (in that capacity, the "Subordinated
Noteholder") and (b) any additional excess shall be released to the Transferor.
On any Payment Date, the "Reserve Fund Requirement" will equal:
o [____%] of the Initial Securities Balance, or
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o on any Payment Date occurring on or after the earlier to occur of
the date on which the last remaining Specified Lease terminates or
the date on which the Program Operating Lease is terminated
following a Program Operating Lease Default, zero, or
o on any Payment Date when the Senior Note Balance shall be zero, the
Securities Balance.
THE RESIDUAL VALUE SURPLUS ACCOUNT
On or before the Closing Date, the Origination Trustee will cause a
trust account to be established in the name of the Origination Trustee for the
benefit of the holders of interests in the SUBIs, into which all Residual Value
Surplus with respect to a Collection Period will be deposited on the related
Deposit Date (the "Residual Value Surplus Account").
The Residual Value Surplus Account will not be funded with any money on
the Closing Date. On the Business Day immediately preceding each Payment Date
(each, a "Deposit Date"), the Administrative Agent will cause the Origination
Trustee to transfer to the Residual Value Surplus Account from the SUBI
Collection Account the amount, if any, of Residual Value Surplus for each
Expired Vehicle sold during that Collection Period.
On each Deposit Date, a withdrawal of an amount equal to the lesser of
(a) the sum of all Residual Value Losses and any unreimbursed Disposition
Expenses relating to Specified Vehicles that were sold by the Administrative
Agent during the related Collection Period and (b) the amount on deposit in the
Residual Value Surplus Account (the "Residual Value Surplus Draw Amount") will
be made from the Residual Value Surplus Account for deposit into the SUBI
Collection Account. On each Payment Date, after giving effect to the withdrawal
of the Residual Value Surplus Draw Amount, if any, from the Residual Value
Surplus Account described in the immediately preceding paragraph on the related
Deposit Date, any amounts remaining on deposit in the Residual Value Surplus
Account will be paid to the Transferor.
THE DISTRIBUTION ACCOUNTS
On or before the Closing Date, (a) the Indenture Trustee will establish
a trust account in the name of the Indenture Trustee on behalf of the Senior
Noteholders, into which amounts released from the SUBI Collection Account and,
when necessary, from the Reserve Fund, for distribution to the Senior
Noteholders will be deposited and from which all distributions to the Senior
Noteholders will be made (the "Note Distribution Account") and (b) the Owner
Trustee will establish a trust account in the name of the Owner Trustee on
behalf of the Certificateholders, into which amounts released from the SUBI
Collection Account and, when necessary, from the Reserve Fund, for distribution
to the Certificateholders will be deposited and from which all distributions to
the Certificateholders will be made (the "Certificate Distribution Account" and,
together with the Note Distribution Account, the "Distribution Accounts"). For
further information regarding these deposits and payments, see "--The SUBI
Collection Account" and "--The Reserve Fund".
On or before each Payment Date, (a) the Origination Trustee shall
deposit or cause to be deposited from the SUBI Collection Account and (b) the
Indenture Trustee shall deposit from the Reserve Fund, if necessary,
respectively, the amounts allocable to the Senior Noteholders and the
Certificateholders, as set forth in "Certain Information Regarding the
Securities--Payments on the Securities--Deposits to the Distribution Accounts;
Priority of Payments" for the related
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Payment Date in the Note Distribution Account and the Certificate Distribution
Account, respectively. On each Payment Date, the Indenture Trustee and the Owner
Trustee will distribute to the Senior Noteholders and the Certificateholders the
allocated amounts for the related Collection Period to the Senior Noteholders
and the Certificateholders, respectively.
MAINTENANCE OF THE ACCOUNTS
The Note Distribution Account and the Reserve Fund, and the SUBI
Collection Account and the Residual Value Surplus Account will be maintained
with the Indenture Trustee and the Trust Agent, respectively, so long as either
(a) the short-term unsecured debt obligations of the Indenture Trustee or the
Trust Agent, as the case may be, are rated in the highest short-term rating
category by each Rating Agency or (b) the Indenture Trustee or the Trust Agent,
as the case may be, is a depository institution or trust company having a
long-term unsecured debt rating acceptable to each Rating Agency and corporate
trust powers and the related Account is maintained in the corporate trust
department of the Indenture Trustee or the Trust Agent, as the case may be (the
"Required Deposit Rating"). Each of the foregoing accounts will be segregated
trust accounts. If either of the Indenture Trustee or the Trust Agent at any
time does not have the Required Deposit Rating, the Administrative Agent shall,
with the assistance of the Indenture Trustee or the Trust Agent, as the case may
be, as necessary, cause the related Account to be moved to a depository
institution or trust company organized under the laws of the United States or
any State that has the Required Deposit Rating.
On the Payment Date on which all Securities have been paid in full and
following payment of any remaining obligations of the Transferor under the Basic
Documents, any amounts remaining on deposit in the Accounts -- after giving
effect to all withdrawals therefrom and deposits thereto in respect of that
Payment Date -- will be paid to the Transferor.
PERMITTED INVESTMENTS
When funds are deposited in (a) the SUBI Collection Account and the
Residual Value Surplus Account and (b) the Reserve Fund, they will be invested
at the direction of the Administrative Agent and the Administrator,
respectively, in one or more Permitted Investments maturing no later than the
Deposit Date immediately succeeding the date of that investment. Notwithstanding
the foregoing, investments on which the entity at which the related Account is
located is the obligor may mature on the related Deposit Date.
On each Payment Date, all net income or other gain from the investment
of funds on deposit in the Residual Value Surplus Account, the Reserve Fund and
the SUBI Collection Account in respect of the related Collection Period will be
deposited in the Reserve Fund. "Permitted Investments" will be specified in the
SUBI Trust Agreement and will be limited to investments that meet the criteria
of each Rating Agency from time to time as being consistent with its
then-current rating of the Senior Notes and the Certificates.
THE CONTINGENT AND EXCESS LIABILITY INSURANCE
In addition to the personal property and liability insurance coverage
required to be obtained and maintained by the Obligor or Ryder pursuant to the
Specified Leases, and as additional protection in the event the Obligor fails to
maintain the required insurance, Ryder maintains contingent liability insurance
for the benefit of, among others, Ryder, the Origination Trust, the UTI
Beneficiaries, the Transferor and the Trust, which provides coverage, with no
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annual or aggregate cap on the number of claims thereunder, for liability caused
by any Specified Vehicle owned by the Origination Trust. Ryder also maintains
substantial amounts of excess insurance coverage as to which the Origination
Trustee is an additional named insured (together with the aforementioned primary
contingent liability insurance policy, the "Contingent and Excess Liability
Insurance"). These insurance policies collectively provide insurance coverage in
excess of $10 million per accident and permit multiple claims in any policy
period. Claims could be imposed against the assets of the Origination Trust if
such coverage were exhausted and damages were assessed against the Origination
Trust. In that event, investors in the Senior Notes could incur a loss on their
investment. See "Risk Factors--Vicarious tort liability may result in a loss of
your investment", "Certain Legal Aspects of the Origination Trust and the
SUBIs--The SUBIs" and "Certain Legal Aspects of the Specified Leases and the
Specified Vehicles--Vicarious Tort Liability" for a discussion of related risks.
With respect to damage to the Specified Vehicles, an Obligor may be
required by the related Specified Lease to maintain comprehensive and collision
insurance. As more fully described under "Additional Document Provisions--The
Administration Agreement--Insurance on Specified Vehicles", the Administrative
Agent will be required to monitor the maintenance of required Obligor insurance.
In the event that the foregoing insurance coverage was exhausted and no
third-party reimbursement for that damage was available, investors in the Senior
Notes could incur a loss on their investment.
The Administration Agreement will provide that for so long as any
Senior Notes or Certificates are outstanding, neither the Origination Trustee
nor Ryder may terminate or cause the termination of any Contingent and Excess
Liability Insurance policy unless each Rating Agency has delivered a letter to
the effect that such termination or any replacement insurance would not cause
its then-current ratings of the Senior Notes or the Certificates to be
qualified, reduced or withdrawn. These obligations of Ryder will survive any
termination of Ryder as Administrative Agent under the Administration Agreement.
ADDITIONAL DOCUMENT PROVISIONS
THE INDENTURE
INDENTURE DEFAULTS. The following events (each an "Indenture Default")
will be events of default under the Indenture:
o a default for 30 days or more in the payment of interest on the
Senior Notes;
o a default in the payment of principal of the Senior Notes on the
Final Payment Date or on a Payment Date fixed for redemption of the
Senior Notes;
o the occurrence of a Program Operating Lease Default;
o a default in the observance or performance of any covenant or
agreement, or any representation or warranty made in the Indenture
or in any certificate or writing delivered under the Indenture
proves to have been incorrect in any material respect at the time
made, and the continuation of that default for a period of 30 days
after notice thereof is given to the Trust by the Indenture Trustee
or to the Trust and the Indenture Trustee by the holders of not less
than 25% of the aggregate principal balance of the Senior Notes; or
o certain events of bankruptcy, insolvency, receivership or
liquidation of the Trust.
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Senior Noteholders holding at least a majority of the aggregate
principal balance of the Senior Notes may waive any past default or Indenture
Default prior to the declaration of the acceleration of the maturity of the
Senior Notes, except a default in the payment of principal of or interest on any
of the Senior Notes, or in respect of any covenant or provision in the Indenture
that cannot be modified or amended without unanimous consent of the Senior
Noteholders.
REMEDIES. If an Indenture Default occurs and is continuing, the
Indenture Trustee or the holders of a majority of the aggregate principal
balance of the Senior Notes may declare the principal of the Senior Notes to be
immediately due and payable. This declaration may be rescinded by the holders of
a majority of the aggregate principal balance of the Senior Notes before a
judgment or decree for payment of the amount due has been obtained by the
Indenture Trustee if
o the Trust has deposited with the Indenture Trustee an amount
sufficient to pay (1) all interest on and principal of the Senior
Notes as if the Indenture Default giving rise to that declaration
had not occurred and (2) all amounts advanced by the Indenture
Trustee and its costs and expenses, and
o all Indenture Defaults -- other than the nonpayment of principal of
the Senior Notes that has become due solely due to that acceleration
-- have been cured or waived.
If the Senior Notes have been declared due and payable following an
Indenture Default, the Indenture Trustee may institute proceedings to collect
amounts due, exercise remedies as a secured party, including foreclosure or sale
of the Trust Estate, or elect to maintain the Trust Estate and continue to apply
proceeds from the Trust Estate as if there had been no declaration of
acceleration. The Indenture Trustee may not, however, unless it is required to
sell the Trust Estate under the Trust Agreement as a result of the bankruptcy or
insolvency of the Transferor, sell the Trust Estate following an Indenture
Default -- other than the occurrence of an Indenture Default described in the
first two bullet points in the definition thereof -- unless
o 100% of the Senior Noteholders consent thereto,
o the proceeds of that sale are sufficient to pay in full the
principal of and the accrued interest on all outstanding Securities,
or
o the Indenture Trustee determines that the Trust Estate would not be
sufficient on an ongoing basis to make all payments on the Senior
Notes as such payments would have become due if such obligations had
not been declared due and payable, and the Indenture Trustee obtains
the consent of holders of 66?% of the aggregate principal balance of
the Senior Notes.
The Indenture Trustee may, but is not required to, obtain and rely upon an
opinion of an independent accountant or investment banking firm as to the
sufficiency of the Trust Estate to pay interest on and principal of the Senior
Notes on an ongoing basis. Any sale of the Trust Estate, other than a sale
resulting from the bankruptcy, insolvency or termination of the Transferor, is
subject to the requirement that an opinion of counsel be delivered to the effect
that such sale will not cause the Origination Trust or the Trust to be
classified as an association, or a publicly traded partnership, taxable as a
corporation for federal income tax purposes.
In the event of a sale of the Trust Estate, either as a result of the
bankruptcy or insolvency of the Transferor or following the occurrence of an
Indenture Default under the circumstances described in the prior paragraph, at
the direction of the Indenture Trustee or the Senior Noteholders, the proceeds
of such sale, including available monies on deposit in the Reserve
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Fund, will be distributed first, to the Indenture Trustee for amounts due as
compensation or indemnity payments pursuant to the terms of the Indenture;
second, to the Administrative Agent for reimbursement of all outstanding
Advances; third, to the Administrative Agent for amounts due in respect of
unpaid Administration Fees; fourth, to the Senior Noteholders to pay due and
unpaid interest -- including any overdue interest and, to the extent permitted
under applicable law, interest on any overdue interest at the Interest Rate;
fifth, to the Reserve Fund for the payment of due and unpaid interest including
any overdue interest and, to the extent permitted under applicable law, interest
on any overdue interest at the Subordinated Note Rate -- on the Subordinated
Notes; sixth, to the Certificate Distribution Account for the payment of due and
unpaid interest -- including any overdue interest and, to the extent permitted
under applicable law, interest on any overdue interest at the Certificate Rate
- -- on the Certificates; seventh, to the Senior Noteholders to pay due and unpaid
principal on the Senior Notes, which shall be allocated to the classes of Senior
Notes on a pro rata basis; eighth, ratably to the Subordinated Noteholder for
amounts due and unpaid in accordance with the terms of the Subordinated Notes,
which amounts shall be deposited into the Reserve Fund, and the
Certificateholders for amounts due and unpaid in accordance with the terms of
the Certificates; ninth, to the Transferor, in its capacity as Subordinated
Noteholder, up to the amount deposited into the Reserve Fund in respect of the
Subordinated Notes on or before the date of the preceding distributions; and
tenth, any remaining amounts shall be paid to the Transferor.
Subject to the provisions of the Indenture relating to the duties of
the Indenture Trustee, if an Indenture Default occurs and is continuing, the
Indenture Trustee will be under no obligation to exercise any of the rights or
powers under the Indenture at the request or direction of any of the Senior
Noteholders if the Indenture Trustee reasonably believes it will not be
adequately indemnified against the costs, expenses and liabilities that might be
incurred by it in complying with that request. Subject to such provisions for
indemnification and some limitations contained in the Indenture, the holders of
at least a majority of the aggregate principal balance of the Senior Notes will
have the right to direct the time, method and place of conducting any proceeding
or any remedy available to the Indenture Trustee or exercising any trust power
conferred on the Indenture Trustee. In addition, the holders of at least a
majority of the aggregate principal balance of the Senior Notes may, in some
cases, waive any default with respect to the Indenture, except a default in the
payment of principal or interest or a default in respect of a covenant or
provision of the Indenture that cannot be modified without the waiver or consent
of all holders of outstanding Senior Notes.
No Senior Noteholder will have the right to institute any proceeding
with respect to the Indenture unless:
o that Senior Noteholder previously has given the Indenture Trustee
written notice of a continuing Indenture Default,
o Senior Noteholders holding not less than 25% of the aggregate
principal balance of the Senior Notes have made written request of
the Indenture Trustee to institute that proceeding in its own name
as Indenture Trustee,
o the Senior Noteholder has offered the Indenture Trustee reasonable
indemnity,
o the Indenture Trustee has for 60 days failed to institute that
proceeding, and
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o no direction inconsistent with that written request has been given
to the Indenture Trustee during that 60 day period by Senior
Noteholders holding a majority of the aggregate principal balance of
the Senior Notes.
Neither the Indenture Trustee nor the Owner Trustee in their respective
individual capacities, nor any holder of a Subordinated Note or a Certificate,
nor any of their respective owners, beneficiaries, agents, officers, directors,
employees, successors or assigns will, in the absence of an express agreement to
the contrary, be personally liable for the payment of interest on or principal
of the Senior Notes or for the agreements of the Trust or the Trustee, in its
capacity as trustee, contained in the Indenture.
CERTAIN COVENANTS. Under the Indenture, the Trust will covenant that it
will not
o sell, transfer, exchange or otherwise dispose of any of its assets,
except as expressly permitted by the Indenture, the Program
Operating Lease and the other Basic Documents,
o claim any credit on or make any deduction from the principal and
interest payable in respect of the Senior Notes -- other than
amounts withheld under the Code or applicable state law -- or assert
any claim against any present or former Senior Noteholder because of
the payment of taxes levied or assessed upon the Trust, or
o permit (1) the validity or effectiveness of the Indenture to be
impaired, (2) any person to be released from any covenants or
obligations with respect to the Senior Notes under the Indenture
except as may be expressly permitted thereby or (3) any lien,
charge, excise, claim, security interest, mortgage or other
encumbrance to be created on or extend to or otherwise arise upon or
burden the Trust's assets or any part thereof, or any interest
therein or the proceeds therefrom.
The Trust may not engage in any activities other than financing, acquiring,
owning, leasing -- subject to the lien of the Indenture, pledging and managing
the SUBI Certificates as contemplated by the Indenture and the other Basic
Documents. The Trust will not incur, assume or guarantee any indebtedness other
than indebtedness incurred pursuant to the Securities or otherwise in accordance
with the Basic Documents.
REPLACEMENT OF THE INDENTURE TRUSTEE. Senior Noteholders holding at
least a majority of the aggregate principal balance of the Senior Notes may
remove the Indenture Trustee without cause by so notifying the Indenture Trustee
and the Trust, and following that removal may appoint a successor Indenture
Trustee. Any successor Indenture Trustee must at all times satisfy all
applicable requirements of the Trust Indenture Act of 1939, and in addition,
have a combined capital and surplus of at least $50,000,000 and a long-term debt
rating of "A" or better by each Rating Agency or be otherwise acceptable to each
Rating Agency. Each Rating Agency must confirm that the appointment of the
successor Indenture Trustee would not cause the then-current ratings on the
Senior Notes and the Certificates to be qualified, reduced or withdrawn.
The Indenture Trustee may resign at any time by so notifying the Trust,
the Administrative Agent and each Rating Agency. The Trust will be required to
remove the Indenture Trustee if the Indenture Trustee:
o ceases to be eligible to continue as the Indenture Trustee,
o is adjudged to be bankrupt or insolvent, or
o otherwise becomes incapable of acting.
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Upon the resignation or removal of the Indenture Trustee, or the failure of the
Senior Noteholders to appoint a successor Indenture Trustee following the
removal without cause of the Indenture Trustee, the Trust will be required
promptly to appoint a successor Indenture Trustee.
DUTIES OF INDENTURE TRUSTEE. Except during the continuance of an
Indenture Default, the Indenture Trustee will
o perform such duties and only such duties as are specifically set
forth in the Indenture,
o rely, as to the truth of the statements and the correctness of the
opinions expressed therein, on certificates or opinions furnished to
the Indenture Trustee that conform to the requirements of the
Indenture, and
o examine any such certificates and opinions that are specifically
required to be furnished to the Indenture Trustee by the Indenture
to determine whether or not they conform to the requirements of the
Indenture.
Upon the continuance of an Indenture Default, the Indenture Trustee will be
required to exercise the rights and powers vested in it by the Indenture and use
the same degree of care and skill in the exercise thereof as a prudent person
would exercise or use under the circumstances in the conduct of that person's
own affairs.
COMPENSATION AND INDEMNITY. The Administrative Agent or the
Administrator will
o pay the Indenture Trustee from time to time reasonable compensation
for its services,
o reimburse the Indenture Trustee for all reasonable expenses,
advances and disbursements reasonably incurred by it in connection
with the performance of its duties as Indenture Trustee, and
o indemnify the Indenture Trustee for, and hold it harmless against,
any loss, liability or expense, including reasonable attorneys' fees
and expenses, incurred by it in connection with the performance of
its duties as Indenture Trustee.
The Indenture Trustee will not be indemnified by the Administrator against any
loss, liability or expense incurred by it through its own willful misconduct,
negligence or bad faith, except that the Indenture Trustee will not be liable
o for any error of judgment made by it in good faith, unless it is
proved that the Indenture Trustee was negligent in ascertaining the
pertinent facts,
o with respect to any action it takes or omits to take in good faith
in accordance with a direction received by it from the Senior
Noteholders in accordance with the terms of the Indenture, and
o for interest on any money received by it except as the Indenture
Trustee and the Trust may agree in writing.
The Indenture Trustee will not be deemed to have knowledge of any event unless
an officer of the Indenture Trustee has actual knowledge of the event or has
received written notice of the event in accordance with the provisions of the
Indenture.
ACCESS TO SENIOR NOTEHOLDER LISTS. If Definitive Notes are issued in
the limited circumstances set forth in "Certain Information Regarding the
Securities--Definitive Notes", or the Indenture Trustee is not the Senior Note
Registrar, the Trust will furnish or cause to be furnished to the Indenture
Trustee a list of the names and addresses of the Senior Noteholders (a) as of
each Record Date, within five days thereafter and (b) as of not more than ten
days before
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the time that list is furnished, within 30 days after receipt by the Trust of a
written request for the list.
ANNUAL COMPLIANCE STATEMENT. The Trust will be required to file an
annual written statement with the Indenture Trustee certifying the fulfillment
of its obligations under the Indenture.
SATISFACTION AND DISCHARGE OF INDENTURE. The Indenture will be
discharged with respect to the collateral securing the Senior Notes upon the
delivery to the Indenture Trustee for cancellation of all of the Senior Notes
or, with some limitations -- including receipt of certain opinions with respect
to tax matters -- upon deposit with the Indenture Trustee of funds sufficient
for the payment in full of all of the Senior Notes, including interest, and any
fees due and payable to the Owner Trustee or the Indenture Trustee.
THE TRUST AGREEMENT
AUTHORITY AND DUTIES OF THE OWNER TRUSTEE. The Owner Trustee will
administer the Trust in the interest of the Certificateholders, subject to the
lien of the Indenture and the obligations of the Trust with respect to the
Subordinated Notes, in accordance with the Trust Agreement and the other Basic
Documents.
Subject to the rights of the Indenture Trustee under the Indenture, the
Transferor, as holder of the Transferor Certificate, may, by written
instruction, direct the Owner Trustee in the administration of the Trust;
provided that such instruction shall not, as evidenced by an opinion of counsel,
materially adversely affect any Senior Noteholder or Certificateholder. The
Owner Trustee will not be required to follow any such instruction if it
reasonably determines or is advised by counsel that so doing is likely to result
in liability to the Owner Trustee, contrary to the terms of the Trust Agreement
or any other Basic Document or any obligation of the Owner Trustee or the Trust,
or unlawful.
The Owner Trustee will not be required to perform any of the
obligations of the Trust under the Trust Agreement or the other Basic Documents
that are required to be performed by
o the Administrative Agent under the Administration Agreement or the
SUBI Trust Agreement,
o the Administrator under the Trust Agreement, the Trust
Administration Agreement or the Indenture;
o the Transferor under the SUBI Certificate Transfer Agreement or the
Program Operating Lease, or
o the Indenture Trustee under the Indenture.
RESTRICTIONS ON ACTIONS BY OWNER TRUSTEE. The Owner Trustee may not:
o initiate or settle any claim or lawsuit involving the Trust, unless
brought by the Administrative Agent to collect amounts owed under a
Specified Lease;
o amend the Indenture by a supplemental indenture where Senior
Noteholder consent is required;
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o amend the Indenture by supplemental indenture where Senior
Noteholder consent is not required if such amendment materially
adversely affects the Certificateholders; or
o amend any Basic Document other than the Trust Agreement if such
amendment materially adversely affects the Certificateholders;
unless (1) the Owner Trustee provides 30 days' written notice thereof to the
Certificateholders and each Rating Agency and (2) Certificateholders holding at
least 25% of the aggregate principal balance of the Certificates do not object
in writing to any such proposed amendment within 30 days of that notice.
ACTIONS BY CERTIFICATEHOLDERS AND OWNER TRUSTEE WITH RESPECT TO CERTAIN
MATTERS. The Owner Trustee may not, except upon the occurrence of an
Administrative Agent Default subsequent to the payment in full of the Senior
Notes and in accordance with the written directions of Certificateholders
holding 66 2/3% of the aggregate principal balance of the Certificates, remove
the Administrative Agent with respect to the SUBI Assets or appoint a successor
Administrative Agent with respect thereto. However, the Owner Trustee will not
be required to follow any directions of the Certificateholders if doing so would
be contrary to any obligation of the Owner Trustee or the Trust. The Owner
Trustee may not sell the Vehicle SUBI Certificate or assign its interest in the
Lease SUBI Certificate except in the event of the bankruptcy or dissolution of
the Trust or the Transferor, or upon an Indenture Default - and in any event
unless the Owner Trustee has properly foreclosed on the Lease SUBI. Upon any
such sale of the Vehicle SUBI Certificate or the assignment of the Lease SUBI
Certificate, the applicable Vehicle SUBI Assets and Lease SUBI Assets will be
distributed to the purchaser thereof and will no longer constitute Origination
Trust Assets, and the Specified Vehicles may be retitled as directed by that
purchaser.
The right of the Transferor or the Certificateholders to take any
action affecting the Trust Estate will be subject to the rights of the Indenture
Trustee under the Indenture.
RESIGNATION AND REMOVAL OF THE OWNER TRUSTEE. The Owner Trustee may
resign at any time upon written notice to the Administrator, the Administrative
Agent, the Transferor, the Indenture Trustee and the Certificateholders,
whereupon the Transferor will be obligated to appoint a successor Owner Trustee.
The Transferor or Certificateholders holding at least a majority of the
aggregate principal balance of the Certificates may remove the Owner Trustee if
the Owner Trustee becomes insolvent, ceases to be eligible or becomes legally
unable to act. Upon removal of the Owner Trustee, the Transferor will appoint a
successor Owner Trustee. The Transferor will be required to deliver written
notice to each Rating Agency of any resignation or removal of the Owner Trustee.
The Owner Trustee and any successor thereto must at all times:
o be able to exercise corporate trust powers;
o be subject to supervision or examination by federal or state
authorities;
o have a combined capital and surplus of at least $50 million; and
o have a long-term debt rating of "A" or better by each Rating Agency
or be otherwise acceptable to each Rating Agency.
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Each Rating Agency must also confirm that the appointment of the successor Owner
Trustee would not cause the then-current ratings of the Senior Notes or the
Certificates to be qualified, reduced or withdrawn. Any co-trustee or separate
trustee appointed for the purpose of meeting applicable state requirements will
not be required to meet these eligibility requirements.
TERMINATION. The Trust Agreement will terminate upon (a) the final
distribution of all funds or other property or proceeds of the Trust Estate in
accordance with the terms of the Indenture and the final distribution on the
Subordinated Notes and the Certificates pursuant to the Trust Agreement, (b) the
occurrence of certain events of bankruptcy, insolvency, receivership or
liquidation with respect to the Transferor or (c) an Optional Purchase by the
Transferor. Upon termination of the Trust Agreement pursuant to clause (b)
above, the Owner Trustee will direct the Indenture Trustee to sell the Trust
Estate, other than amounts on deposit in the Distribution Accounts, in a
commercially reasonable manner and on commercially reasonable terms. The
Indenture Trustee will apply the proceeds of that sale to pay amounts owed to
the Indenture Trustee and interest on and principal of the Securities in
accordance with the terms of the Indenture. See "--The Indenture--Remedies".
LIABILITIES AND INDEMNIFICATION. The Transferor, as holder of the
Transferor Certificate and the Subordinated Notes, will be directly liable for
any claims against the Trust -- other than payment of principal of and interest
on the Securities -- as if the Trust were a partnership and the Transferor were
a general partner thereof. The Transferor, in that capacity, will indemnify the
Owner Trustee for any expenses incurred by the Owner Trustee in the performance
of its duties under the Trust Agreement. The Transferor will not be entitled to
make any claim upon the Trust Estate for the payment of any such liabilities or
indemnified expenses. The Transferor will not indemnify the Owner Trustee for
expenses resulting from the willful misconduct, bad faith or negligence of the
Owner Trustee, or for the inaccuracy of any representation or warranty of the
Owner Trustee in the Trust Agreement. The Owner Trustee will not be liable for:
o any error in judgment of an officer of the Owner Trustee,
o any action taken or omitted to be taken in accordance with the
instructions of any Certificateholder, the Indenture Trustee, the
Transferor or the Administrative Agent,
o the interest on or principal of the Securities, or
o the default or misconduct of the Administrator, the Administrative
Agent, the Transferor or the Indenture Trustee.
THE SUBORDINATED NOTES. The Subordinated Notes will be issued to the
Transferor pursuant to the Trust Agreement, pledged by the Transferor to the
Trust and held by the Indenture Trustee during the term of the Indenture as part
of the Trust Estate pledged to the Indenture Trustee. The Subordinated Notes
will be subordinated in right of payment to the Senior Notes to the extent
described herein. See "Certain Information Regarding the Securities--Payments on
the Securities" and "Security for the Securities--The Subordinated Notes". If a
default occurs with respect to the Trust's obligations under the Subordinated
Notes while the Senior Notes are outstanding, the Subordinated Noteholder will
not be permitted to declare the principal balance of the Subordinated Notes to
be immediately due and payable.
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THE SUBI TRUST AGREEMENT
THE SUBIs, OTHER SUBIs AND THE UTI.
The UTI Beneficiaries are the initial beneficiaries of the Origination
Trust. The UTI Beneficiaries may from time to time assign, transfer, grant and
convey, or cause to be assigned, transferred, granted and conveyed, to the
Origination Trustee, in trust, Origination Trust Assets. The UTI Beneficiaries
will hold the UTI, which represents a beneficial interest in all Origination
Trust Assets except for (a) any Origination Trust Assets allocated to Other
SUBIs ("Other SUBI Assets") and (b) the SUBI Assets (those Origination Trust
Assets to be referred to as the "UTI Assets"). The UTI Beneficiaries may in the
future pledge the UTI as security for obligations to third-party lenders and may
in the future create and sell or pledge Other SUBIs in connection with
financings similar to the transaction described in this prospectus. Each holder
or pledgee of the UTI will be required to expressly waive any claim to the
Origination Trust Assets other than the UTI Assets and to fully subordinate any
such claims to those other Origination Trust Assets in the event that the waiver
is not given full effect. Each holder or pledgee of any Other SUBI will be
required to expressly waive any claim to the Origination Trust Assets, except
for the related Other SUBI Assets, and to fully subordinate those claims to the
Origination Trust Assets or any other SUBI in the event that waiver is not given
effect. Except under the limited circumstances described under "Certain Legal
Aspects of the Origination Trust and the SUBIs--The SUBIs" and "--The SUBIs,
Other SUBIs and the UTI", the SUBI Assets will not be available to make payments
in respect of, or pay expenses relating to, the UTI or any Other SUBI. Any Other
SUBI Assets evidenced by any Other SUBIs will not be available to make payments
in respect of, or pay expenses relating to, the SUBIs, the UTI or any Other
SUBI.
Each Other SUBI will be created pursuant to a supplement to the
Origination Trust Agreement (each, an "Other SUBI Supplement"), which will amend
the Origination Trust Agreement only with respect to the Other SUBI to which it
relates. The SUBI Supplement will amend the Origination Trust Agreement only as
it relates to the SUBIs and no Other SUBI Supplement will amend the Origination
Trust Agreement as it relates to the SUBIs.
All Origination Trust Assets, including the SUBI Assets, will be owned by
the Origination Trustee on behalf of the beneficiaries of the Origination Trust.
The SUBI Assets will be segregated from the rest of the Origination Trust Assets
on the books and records of the Origination Trustee and the Administrative
Agent, and the holders of other beneficial interests in the Origination Trust --
including the UTI and any Other SUBIs -- will have no rights in or to the SUBI
Assets. Liabilities of the Origination Trust will be respectively allocated to
the SUBI Assets, the UTI Assets and Other SUBI Assets if incurred in each case
with respect thereto, or will be allocated pro rata among all Origination Trust
Assets if incurred with respect to the Origination Trust Assets generally.
SPECIAL OBLIGATIONS OF THE UTI BENEFICIARIES
The UTI Beneficiaries will be jointly and severally liable for all
debts and obligations arising with respect to the Origination Trust Assets or
the operation of the Origination Trust, except that their liability with respect
to any pledge of the UTI and any assignee or pledgee of a SUBI or a SUBI
Certificate or any Other SUBI or Other SUBI Certificate shall be as set forth in
the financing documents relating thereto. To the extent the UTI Beneficiaries
pay or suffer any liability or expense with respect to the Origination Trust
Assets or the operation of the Origination Trust, the UTI Beneficiaries will be
indemnified, defended and held harmless out of the assets of the Origination
Trust against any such liability or expense, including reasonable attorneys'
fees and expenses.
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ORIGINATION TRUSTEE DUTIES AND POWERS; FEES AND EXPENSES
Under the SUBI Trust Agreement, the Origination Trustee will be
required to (a) apply for and maintain, or cause to be applied for and
maintained, all licenses, permits and authorizations necessary or appropriate to
accept assignments of the Specified Leases and the Specified Vehicles and to
carry out its duties as Origination Trustee and (b) when required by applicable
state law or administrative practice, file, or cause to be filed, applications
for certificates of title as are necessary or appropriate so as to cause the
Origination Trust or the Origination Trustee on behalf of the Origination Trust
to be recorded as the owner or holder of legal title of record to the Specified
Vehicles. In carrying out these duties, the Origination Trustee will be required
to exercise the same degree of care and skill as a prudent person would exercise
or use under the circumstances in the conduct of that person's own affairs.
The Origination Trustee may be replaced by the UTI Beneficiaries,
acting together, if it ceases to be qualified in accordance with the terms of
the SUBI Trust Agreement, or if certain representations and warranties made by
the Origination Trustee therein prove to have been materially incorrect when
made or in the event of certain events of bankruptcy or insolvency of the
Origination Trustee.
The Origination Trustee will make no representations as to the validity
or sufficiency of the SUBIs, the SUBI Certificates, or the Retained SUBI
Certificates -- other than the execution and authentication of the SUBI
Certificates and the Retained SUBI Certificates -- or of any Specified Lease,
Specified Vehicle or related document, will not be responsible for performing
any of the duties of the UTI Beneficiaries or the Administrative Agent and will
not be accountable for the use or application by any owners of beneficial
interests in the Origination Trust Assets of any funds paid in respect of the
Origination Trust Assets or the investment of any of such monies before such
monies are deposited into the accounts relating to the SUBIs, any Other SUBI and
the UTI. The Origination Trustee will not independently verify the Specified
Leases or the Specified Vehicles. The duties of the Origination Trustee will
generally be limited to the acceptance of assignments of Leases, the titling of
Vehicles in the name of the Origination Trust or the Origination Trustee on
behalf of the Origination Trust, the creation of the SUBIs, Other SUBIs and the
UTI, the creation of the SUBI Collection Account and the Residual Value Surplus
Account and the receipt of the various certificates, reports or other
instruments required to be furnished to the Origination Trustee under the SUBI
Trust Agreement, in which case the Origination Trustee will only be required to
examine them to determine whether they conform to the requirements of the SUBI
Trust Agreement.
The Origination Trustee will be under no obligation to exercise any of
the rights or powers vested in it by the SUBI Trust Agreement, to make any
investigation of any matters arising thereunder or to institute, conduct or
defend any litigation thereunder or in relation thereto at the request, order or
direction of the UTI Beneficiaries, the Administrative Agent or the holders of a
majority in interest in the SUBIs, unless such party or parties have offered to
the Origination Trustee reasonable security or indemnity against any costs,
expenses or liabilities that may be incurred therein or thereby. The reasonable
expenses of every such exercise of rights or powers or examination will be paid
by the party or parties requesting such exercise or examination or, if paid by
the Origination Trustee, will be a reimbursable expense of the Origination
Trustee.
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The Origination Trustee may enter into one or more agreements with such
person or persons, including without limitation any affiliate of the Origination
Trustee, as are by experience and expertise qualified to act in a trustee
capacity and otherwise acceptable to the UTI Beneficiaries. The Origination
Trustee has engaged U.S. Bank as Trust Agent. Under the SUBI Trust Agreement,
the Trust Agent shall perform each and every obligation of the Origination
Trustee under the SUBI Trust Agreement.
INDEMNITY OF TRUSTEE AND TRUST AGENTS
The Origination Trustee and each Trust Agent will be indemnified and
held harmless out of and to the extent of the Origination Trust Assets with
respect to any loss, liability, claim, damage or reasonable expense, including
reasonable fees and expenses of counsel and reasonable expenses of litigation
(collectively, a "Loss"), arising out of or incurred in connection with (a) any
of the Origination Trust Assets, including without limitation any Loss relating
to Leases or Vehicles, any personal injury or property damage claims arising
with respect to any such Vehicle or any Loss relating to any tax arising with
respect to any Origination Trust Asset, or (b) the Origination Trustee's or the
Trust Agent's acceptance or performance of the trusts and duties contained in
the SUBI Trust Agreement. Notwithstanding the foregoing, neither the Origination
Trustee nor any Trust Agent will be indemnified or held harmless out of the
Origination Trust Assets as to such a Loss:
o for which Ryder shall be liable under the Administration Agreement,
o incurred by reason of the Origination Trustee's or that Trust
Agent's willful misfeasance, bad faith or negligence, or
o incurred by reason of the Origination Trustee's or that Trust
Agent's breach of its respective representations and warranties made
in the SUBI Trust Agreement or the Administration Agreement.
TERMINATION
The Origination Trust will dissolve and the obligations and
responsibilities of the UTI Beneficiaries and the Origination Trustee will
terminate upon the later to occur of the full payment of all amounts owed under
the Origination Trust Agreement, the Trust Agreement and the Indenture or any
financing in connection with an Other SUBI.
TRUST AS THIRD-PARTY BENEFICIARY
As the holder of the Vehicle SUBI Certificate and the SUBI Interest
evidenced thereby and a pledgee of the Lease SUBI Certificate and the SUBI
Interest evidenced thereby, the Trust will be a third-party beneficiary of the
SUBI Trust Agreement. Therefore, the Trust may, and, upon the direction of
holders of Senior Notes and Certificates holding at least 51% of the aggregate
unpaid principal balance of the Senior Notes and Certificates, unless a higher
percentage is required by either the Trust Agreement or the Indenture, voting
together as a single class, will, exercise any right conferred by the SUBI Trust
Agreement upon a holder of any interest in the SUBIs. However, during the term
of the Indenture, any action with respect to the SUBIs must be approved by the
Senior Noteholders in such percentage as required by the Indenture. See
"--Miscellaneous Provisions--Amendment Provisions".
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THE ADMINISTRATION AGREEMENT
GENERAL
Under the Administration Agreement, the Administrative Agent will
perform on behalf of the Origination Trust all of the obligations of the lessor
under the Specified Leases, including, but not limited to, collecting and
processing payments, responding to inquiries of Obligors, investigating
delinquencies, sending payment statements, paying costs of the sale or other
disposition of Expired Vehicles or Default Vehicles, overseeing the Specified
Leases, commencing legal proceedings to enforce Specified Leases and servicing
the Specified Leases, including accounting for collections, furnishing monthly
and annual statements to the Origination Trustee with respect to distributions
and generating federal income tax information. In this regard, the
Administrative Agent will make reasonable efforts to collect all amounts due on
or in respect of the Specified Leases and, in a manner consistent with the
Administration Agreement, will be obligated to service the Specified Leases
generally in accordance with the customary and usual procedures of institutions
that service truck, tractor and trailer leases and, to the extent more exacting,
the procedures used by the Administrative Agent in respect of truck, tractor and
trailer leases serviced by it for its own account. Payments made in respect of
the Maintenance Component will be retained by or remitted to the Maintenance
Provider as compensation for providing maintenance and other specified services
to the Specified Vehicles, and will not be available to make Program Operating
Lease Payments or to make payments on the Senior Notes. See "Ryder--Lease
Payments--Calculation of the Financial Component". The Trust will be a
third-party beneficiary of the Administration Agreement.
The Administration Agreement will require the Administrative Agent to
obtain all licenses and make all filings required to be held or filed by the
Origination Trust in connection with the ownership of the Specified Leases and
the Specified Vehicles and take all necessary steps to maintain evidence of the
Origination Trust's ownership on the certificates of title to the Specified
Vehicles.
The Administrative Agent will be responsible for filing all periodic
sales and use tax or property, real or personal, tax reports, periodic renewals
of licenses and permits, periodic renewals of qualifications to act as a
business trust and other periodic regulatory filings, registrations or approvals
arising with respect to or required of the Origination Trustee or the
Origination Trust.
CUSTODY OF LEASE DOCUMENTS AND CERTIFICATES OF TITLE
To reduce administrative costs and ensure uniform quality in the
servicing of the Specified Leases and Ryder's own portfolio of leases, the
Origination Trustee will appoint the Administrative Agent as its agent, bailee
and custodian of the Specified Leases, the certificates of title relating to the
Specified Vehicles, the insurance policies and insurance records and other
documents related to the Specified Leases and the related Obligors and Specified
Vehicles. Such documents will not be physically segregated from other leases,
certificates of title, insurance policies and insurance records or other
documents related to other leases and vehicles owned or serviced by the
Administrative Agent, including Leases and Vehicles which are not part of the
SUBI Assets. The accounting records and computer systems of Ryder will reflect
the allocation of the Specified Leases and Specified Vehicles to the SUBIs, and
the interest of the holders of the SUBI Certificates therein. UCC financing
statements reflecting certain interests in the
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Specified Leases will be filed as described under "Certain Legal Aspects of the
Specified Leases and Specified Vehicles--Back-up Security Interests".
COLLECTIONS
GENERAL. Under the Administration Agreement, except as otherwise
permitted under the Monthly Remittance Condition and described under "--Monthly
Remittance Condition", the Administrative Agent will deposit Collections
received into the SUBI Collection Account within two Business Days of
processing. "Collections" with respect to any Collection Period will include all
net collections collected or received in respect of the SUBI Assets during the
three Monthly Periods comprising that Collection Period that are allocable to
the Program Operating Lease or the Securities, including:
o Financial Component payments and Partial Financial Component
Payments made by Obligors;
o Reallocation Payments made by the Administrative Agent;
o Sales Proceeds other than Residual Value Surplus, Termination
Proceeds, Casualty Proceeds and Insurance Proceeds;
o Termination Value Payments; and
o payments by the Administrative Agent of the Securitization Value of
certain Specified Leases before the Maturity Dates of such Specified
Leases and certain Expired Vehicles, as described in this prospectus
under "--Purchase of Specified Vehicles Before their Maturity Dates"
and "--Purchase of Expired Vehicles".
MONTHLY REMITTANCE CONDITION. The Administration Agreement will require
the Administrative Agent to make all deposits of Collections received on or in
respect of the Specified Leases and the Specified Vehicles to be deposited into
the SUBI Collection Account on the second Business Day following processing
thereof. However, so long as the Monthly Remittance Condition is satisfied, the
Administrative Agent may retain such amounts received during a Monthly Period
until the second day following that Monthly Period. The "Monthly Remittance
Condition" will be satisfied if (a)(1) Ryder is the Administrative Agent, (2)
Ryder's short-term debt is rated in the highest rating category, or is otherwise
acceptable to, each Rating Agency and (3) no Administrative Agent Default has
occurred or (b)(1) the Administrative Agent obtains a letter of credit, surety
bond or insurance policy under which demands for payment may be made to secure
timely remittance of monthly collections to the SUBI Collection Account and (2)
the Trustees are provided with confirmation from each Rating Agency to the
effect that the use of such alternative remittance schedule will not result in
the qualification, reduction or withdrawal of its then-current rating on the
Senior Notes or the Certificates. Pending deposit into the SUBI Collection
Account, Collections may be used by the Administrative Agent at its own risk and
for its own benefit and will not be segregated from its own funds.
NET DEPOSITS. For so long as Ryder is the Administrative Agent, the
Administrative Agent will be permitted to deposit into the SUBI Collection
Account only the net amount distributable to the Trust, as holder of the Vehicle
SUBI Certificate, on the related Deposit Date. The Administrative Agent will,
however, account to the Trust, the Trustees and the Senior Noteholders and
Certificateholders as if all of the deposits and distributions described herein
were made individually. This provision has been established for the
administrative convenience
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of the parties involved and will not affect amounts required to be deposited
into the Accounts for the benefit of the Securityholders.
PAYMENT OF THE MAINTENANCE COMPONENT TO THE MAINTENANCE PROVIDER.
During each Collection Period, the Maintenance Component payment, to the extent
available, will be allocated and retained by or paid to the Maintenance
Provider. Payments on the Specified Leases will be allocated pro rata using the
Financial Component and the Maintenance Component thereof.
FINANCIAL COMPONENT PAYMENTS. If an Obligor makes a monthly payment
equal to the Total Monthly Payment billed with respect to all Vehicles leased by
that Obligor for the related Monthly Period, which may include one or more
Specified Vehicles as well as one or more Vehicles allocated to the UTI or one
or more Other SUBIs (collectively, "Obligor Vehicles"), the Administrative Agent
will deposit into the SUBI Collection Account the entire Financial Component
relating to the Specified Vehicles leased by that Obligor. If an Obligor makes a
monthly payment of less than the Total Monthly Payment billed in respect of a
Specified Vehicle or in respect of all Obligor Vehicles for that Monthly Period,
the Administrative Agent will deposit into the SUBI Collection Account a pro
rata share of the total amount paid (the "Partial Financial Component Payment")
determined by multiplying the total amount paid by a percentage equal to the
Financial Component due divided by the Total Monthly Payment due.
SALES PROCEEDS AND TERMINATION PROCEEDS
Under the Administration Agreement, the Administrative Agent, on behalf
of the Trust, will sell or otherwise dispose of Specified Vehicles:
o related to Specified Leases that have reached their respective
Maturity Dates, or as to which the Annual Termination Option was
exercised but an amount equal to the related Termination Value
Payment was not paid (each, an "Expired Vehicle"),
o related to Default Termination Leases (each, a "Defaulted Vehicle"),
and
o under the circumstances described under "--Purchase of Specified
Vehicles Before their Maturity Dates".
In connection with the sale or other disposition of an Expired Vehicle or a
Defaulted Vehicle, within two Business Days of processing, the Administrative
Agent will deposit into the SUBI Collection Account all Sales Proceeds from
Specified Vehicles received during the related Collection Period. On each
Deposit Date, the Administrative Agent will cause the Origination Trustee,
acting through the Trust Agent, to transfer any Residual Value Surplus to the
Residual Value Surplus Account. Any payment received from the related Obligor in
respect of the Termination Value of the related Specified Vehicle will be
deposited into the SUBI Collection Account.
"Disposition Expenses" will mean expenses and other amounts reasonably
incurred by the Administrative Agent in connection with the sale or other
disposition of an Expired Vehicle or a Defaulted Vehicle, including but not
limited to sales commissions, and expenses incurred in connection with making
claims under any Contingent and Excess Liability Insurance or other applicable
insurance policies. Disposition Expenses will be reimbursable to the
Administrative Agent:
o as a deduction from Sales Proceeds, Termination Proceeds and
Casualty Proceeds, and
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o in the case of Disposition Expenses relating to the sale of
Vehicles, from amounts on deposit in the Residual Value Surplus
Account.
"Residual Value Losses" in respect of a Collection Period will mean the
amount by which the Sales Proceeds from the sale of Specified Vehicles,
excluding any Insurance Proceeds, during that Collection Period are less than
the aggregate Securitization Values of the related Specified Leases.
"Residual Value Surplus" will mean the amount, if any, by which the
Sales Proceeds of any Expired Vehicle, excluding any amounts paid by an Obligor
or any Casualty Proceeds, exceed the Securitization Value of the related
Specified Lease as of the effective date of termination of that Specified Lease.
"Sales Proceeds" with respect to any Expired Vehicle or Defaulted
Vehicle will mean all proceeds received from the sale or other disposition of
that Vehicle, including any applicable Insurance Proceeds, less all applicable
Disposition Expenses and, in the case of an Expired Vehicle, any outstanding
Sales Proceeds Advances.
"Termination Proceeds" with respect to any Defaulted Vehicle will mean
an amount equal to the sum of (1) any payment received from the related Obligor
in respect of the Termination Value of Vehicle and (2) the Sales Proceeds.
PURCHASE OF SPECIFIED VEHICLES BEFORE THEIR MATURITY DATES
The Administrative Agent will be required to purchase or cause to be
purchased a Specified Vehicle before the Maturity Date of the related Specified
Lease and remit to the SUBI Collection Account an amount equal to the
Securitization Value of that Specified Lease as of the effective date of
termination if:
o that Specified Lease becomes a Casualty Termination Lease and,
pursuant to that Specified Lease, the Administrative Agent is
responsible for paying for the loss or theft of or damage to that
Specified Vehicle;
o the Administrative Agent (1) agrees with the Obligor to a change in
the lease rates applicable to that Specified Vehicle and that change
results in a change in the Residual Value and/or the Lease Term or
(2) invoices the Obligor for a material mileage surcharge under that
Specified Lease for that Specified Vehicle;
o at the request of the Obligor, the Administrative Agent permits that
Obligor to (1) terminate that Specified Lease other than through the
exercise of the Annual Termination Option or (2) reduce or delay
payments due in respect of the Financial Component of that Specified
Lease;
o that Obligor exercises the Annual Termination Option or that
Specified Lease becomes a Default Termination Lease and the
Administrative Agent (1) releases the Obligor from its obligation to
purchase that Specified Vehicle for its Termination Value or (2)
neither demands that the Obligor so purchase that Specified Vehicle
nor offers a termination or default settlement to the Obligor for
that Specified Vehicle; or
o that Obligor exercises the Annual Termination Option or that
Specified Lease becomes a Default Termination Lease and that
Specified Lease has been amended to
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eliminate the Obligor's obligation to thereupon purchase that
Specified Vehicle for its Termination Value.
The Administrative Agent will be required to purchase a Specified
Vehicle before the Maturity Date of the related Specified Lease and remit to the
SUBI Collection Account an amount equal to the Securitization Value of that
Specified Lease as of the effective date of termination if the related Obligor
desires to change the domicile of or title to a Vehicle subject to a Lease and
that change would result in (a) the Origination Trust doing business in a
jurisdiction in which it is not then qualified and licensed or (b) significant
transfer expenses not paid by the Obligor, including without limitation the
imposition of any transfer tax. In addition, the Administrative Agent may, but
will not be required to, purchase or cause to be purchased a Specified Vehicle
before the Maturity Date of the related Specified Lease and remit to the SUBI
Collection Account an amount equal to the Securitization Value of that Specified
Lease as of the effective date of termination if (a) the Administrative Agent
exercises the Annual Termination Option, including, without limitation, if the
related Obligor rejects an increase in the Maintenance Component when the
current Maintenance Component provides the Maintenance Provider with below
average service margins or (b) the Administrative Agent elects to purchase that
Specified Vehicle for any other administrative or commercial reason (each, a
"Special Event Purchase"). Notwithstanding the foregoing, Special Event
Purchases may only be made with respect to Specified Vehicles having an
aggregate initial Securitization Value of no more than 10% of the Initial
Securities Balance in the aggregate over the term of the Securities, and with
respect to no more than 5% of the Initial Securities Balance in any calendar
year.
"Insurance Proceeds" will include recoveries under any insurance policy
or rights thereunder or proceeds therefrom, including any self-insurance and
also including the Contingent and Excess Liability Insurance, and any vehicle
liability insurance policy required to be obtained and maintained by the
Administrative Agent or the related Obligors pursuant to the Specified Leases,
and amounts paid by any insurer under any other insurance policy relating to the
Specified Leases or the related Obligors or Specified Vehicles.
PURCHASE OF EXPIRED VEHICLES. The Administrative Agent may purchase an
Expired Vehicle at any time. With respect to the related Specified Lease, in the
event that
o no Sales Proceeds Advance has been made, the purchase price will
equal the Securitization Value of that Specified Lease as of the
date of expiration, and
o a Sales Proceeds Advance has been made,
no additional amounts need be remitted by the Administrative Agent; however, the
Administrative Agent will relinquish all rights to reimbursement of that Sales
Proceeds Advance.
CASUALTY PROCEEDS. If an Obligor is responsible for paying for damage
to a Specified Vehicle relating to a Casualty Termination Lease, the
Administrative Agent will remit to the SUBI Collection Account, within two
Business Days of processing, an amount equal to the sum of
o all Insurance Proceeds received in respect of damage to that
Specified Vehicle (the "Insurance Casualty Proceeds"), and
o any proceeds received from the sale of that Specified Vehicle at
salvage, net of any applicable Disposition Expenses (the "Salvage
Casualty Proceeds", and together with the Insurance Casualty
Proceeds, the "Casualty Proceeds").
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All Casualty Proceeds will be deposited in the SUBI Collection Account.
In the event that a Specified Lease becomes a Casualty Termination
Lease and that Specified Lease requires the Administrative Agent to be
responsible for all loss or theft of or damage to the related Specified Vehicle,
the Administrative Agent will remit to the SUBI Collection Account an amount
equal to the Securitization Value of that Casualty Termination Lease as of the
effective date of casualty.
EXTENSIONS
The Administration Agreement will provide that no extensions of a
Specified Lease may be granted, except that for operational and administrative
purposes, the Administrative Agent may, on behalf of the Trust, delay or
accelerate the Maturity Date of a Specified Lease by as much as 45 days.
NOTIFICATION OF LIENS AND CLAIMS
The Administrative Agent will be required to notify as soon as
practicable the Transferor -- in the event that Ryder is not acting as the
Administrative Agent, the Indenture Trustee and the Origination Trustee of all
liens or claims of any kind of a third party that would materially and adversely
affect the interests of, among others, the Transferor or the Origination Trust
in any Specified Lease or Specified Vehicle. When the Administrative Agent
becomes aware of any such lien or claim with respect to any Specified Lease or
Specified Vehicle, it will take whatever action it deems reasonably necessary to
cause that lien or claim to be removed.
ADVANCES
On each Deposit Date, the Administrative Agent will be obligated to
make, by deposit into the SUBI Collection Account, a Financial Component Advance
in respect of the unpaid Financial Component of certain Specified Vehicles, and
a Sales Proceeds Advance in respect of the Securitization Value of Specified
Leases relating to certain Expired Vehicles. An "Advance" refers to either a
Financial Component Advance or a Sales Proceeds Advance. The Administrative
Agent will be required to make an Advance only to the extent that it determines
that such Advance will be recoverable from future payments or collections on the
related Specified Lease or Specified Vehicle or otherwise. In making Advances,
the Administrative Agent will assist in maintaining a regular flow of scheduled
payments on the Specified Leases and, accordingly, in respect of the Program
Operating Lease and the Senior Notes, rather than guarantee or insure against
losses. Accordingly, all Advances will be reimbursable to the Administrative
Agent, without interest, as described in this prospectus.
FINANCIAL COMPONENT ADVANCES. If an Obligor makes a monthly payment
that is less than the Total Monthly Payment billed with respect to all Obligor
Vehicles for the related Monthly Period, but the payment made is greater than or
equal to the Fixed Charge for all Obligor Vehicles, the Administrative Agent
will advance the entire difference between (a) the amount of the Financial
Component due and (b) the Partial Financial Component Payment (each, a "Full
Financial Component Advance").
If an Obligor makes a monthly payment that is less than the Total
Monthly Payment billed with respect to all Obligor Vehicles for the related
Monthly Period, and the payment made is less than the Fixed Charge for all
Obligor Vehicles, the Administrative Agent will advance an amount equal to
(a)(1) the actual Obligor payment, multiplied by (2) a percentage equal to (A)
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the actual Obligor payment divided by (B) the Fixed Charge for all Obligor
Vehicles, less (b) the Partial Financial Component Payment (each, a "Partial
Financial Component Advance"). Notwithstanding the foregoing, the total amount
paid shall not exceed the total amount of the Financial Component due for the
related Monthly Period.
The Administrative Agent will be entitled to reimbursement of all
Partial Financial Component Advances and all Full Financial Component Advances
(collectively, "Financial Component Advances") from (a) subsequent payments made
by the related Obligor in respect of the Total Monthly Payment due or (b) if the
Obligor defaults on its obligation to make the entire Total Monthly Payment due
or fails to make the entire Total Monthly Payment due within 180 days after the
date of billing, from Available Funds as part of the Payment Date Advance
Reimbursement on the Payment Date in the Collection Period immediately
succeeding the Collection Period in which that default occurred or that 180-day
period ended.
SALES PROCEEDS ADVANCES. If, during a Collection Period, the
Administrative Agent has not sold a Specified Vehicle that became an Expired
Vehicle during that Collection Period, on the related Deposit Date the
Administrative Agent will advance the Securitization Value of the related
Specified Lease to the Trust (each, a "Sales Proceeds Advance").
After the Administrative Agent makes a Sales Proceeds Advance for an
Expired Vehicle, the Trust will have no claim against or interest in that
Expired Vehicle or any Sales Proceeds resulting from its sale or other
disposition except with respect to Residual Value Surplus. If the Administrative
Agent sells an Expired Vehicle after making a Sales Proceeds Advance, the Trust
will retain the Sales Proceeds Advance and the Administrative Agent will retain
the Sales Proceeds up to the Securitization Value of the related Specified
Lease, and will deposit the Residual Value Surplus into the SUBI Collection
Account, which will be transferred on the related Deposit Date to the Residual
Value Surplus Account.
If the Administrative Agent has not sold an Expired Vehicle within 270
days after it has made a Sales Proceeds Advance, it will be reimbursed for that
Sales Proceeds Advance from the SUBI Collection Account. Within six months of
receiving that reimbursement, if the related Specified Vehicle has not been
sold, the Administrative Agent shall cause that Specified Vehicle to be sold at
auction and shall remit the proceeds associated with the disposition of that
Specified Vehicle to the SUBI Collection Account.
INSURANCE ON THE SPECIFIED VEHICLES
Each Specified Lease will indicate whether Ryder or the related Obligor
will be required to maintain in full force and effect during the related Lease
Term a comprehensive collision and physical damage insurance policy covering the
actual cash value of the related Specified Vehicle and naming the Origination
Trustee, on behalf of the Origination Trust, as loss payee. Additionally, either
Ryder or the related Obligor will be required to maintain vehicle liability
insurance in amounts equal to the greater of the amount prescribed by applicable
state law or industry standards as set forth in the related Specified Lease,
naming the Origination Trust or Origination Trustee, on behalf of the
Origination Trust, as an additional insured. Because Obligors may choose their
own insurers to provide the required coverage, the actual terms and conditions
of their policies may vary. If an Obligor fails to obtain or maintain the
required insurance, the related Specified Lease will be in default and the
Administrative Agent may either obtain insurance on behalf of, and at the
expense of, the Lessee or deem the related Lease in
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default. In that event, it is the practice of the Administrative Agent to
repossess the related Specified Vehicle.
Ryder does not require Obligors to carry credit disability, credit life
or credit health insurance or other similar insurance coverage that provides for
payments to be made on the Specified Leases on behalf of such Obligors in the
event of disability or death. To the extent that such insurance coverage is
obtained on behalf of an Obligor, payments received in respect of such coverage
may be applied to payments on the related Specified Lease to the extent that
such Obligor's beneficiary chooses to do so.
REALIZATION UPON CHARGED-OFF SPECIFIED LEASES
The Administrative Agent will use commercially reasonable efforts to
repossess and liquidate Defaulted Vehicles. Such liquidation may be effected
through repossession of that Defaulted Vehicles and their disposition through
sale, or the Administrative Agent may take any other action permitted by
applicable law. The Administrative Agent may enforce all rights of the lessor
under the related Default Termination Lease, sell that Defaulted Vehicle in
accordance with such Default Termination Lease and commence and pursue any
proceedings in connection with such Default Termination Lease. In connection
with any such repossession, the Administrative Agent will follow such practices
and procedures as it deems necessary or advisable and as are normal and usual in
the servicing of full-service operating truck, tractor and trailer leases, and
in each case in compliance with applicable law, and to the extent more exacting,
the practices and procedure used by the Administrative Agent in respect of any
leases serviced by it for its own account. The Administrative Agent will be
responsible for all costs and expenses incurred in connection with the sale or
other disposition of Defaulted Vehicles, but will be entitled to reimbursement
to the extent such costs constitute Disposition Expenses or are expenses
recoverable under an applicable insurance policy. Proceeds from the sale or
other disposition of repossessed Specified Vehicles will constitute Termination
Proceeds and will be deposited into the SUBI Collection Account. To the extent
not otherwise covered by Sales Proceeds or Termination Proceeds, the
Administrative Agent will be entitled to reimbursement of all Disposition
Expenses from amounts on deposit in the Residual Value Surplus Account upon
presentation to the Indenture Trustee of an officer's certificate of the
Administrative Agent. Collections in respect of a Collection Period will include
all Sales Proceeds and Termination Proceeds collected during that Collection
Period.
ADMINISTRATIVE AGENT RECORDS, DETERMINATIONS AND REPORTS
The Administrative Agent will retain or cause to be retained all
data -- including, without limitation, computerized records, operating software
and related documentation -- relating directly to or maintained in connection
with the servicing of the Specified Leases. Upon the occurrence and continuance
of an Administrative Agent Default and termination of the Administrative Agent's
obligations under the Administration Agreement, the Administrative Agent will
use commercially reasonable efforts to effect the orderly and efficient transfer
of the servicing of the Specified Leases to a successor servicer.
The Administrative Agent will perform some monitoring and reporting
functions on behalf of the Transferor, the Trust, the Trustees and the Senior
Noteholders, including the preparation and delivery to the Indenture Trustee,
the Origination Trustee and each Rating Agency, on or before each Determination
Date, of a quarterly certificate setting forth all information necessary to make
all distributions required in respect of the related Collection
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Period, and the preparation and delivery of quarterly statements setting forth
the information described under "Certain Information Regarding the
Securities--Statements to Senior Noteholders", and an annual officer's
certificate specifying the occurrence and status of any Administrative Agent
Default.
EVIDENCE AS TO COMPLIANCE
Under the Administration Agreement, on or before April 30 of each year,
beginning April 30, 2000, a firm of nationally recognized independent
accountants will furnish the Trust with a statement as to compliance by the
Administrative Agent during the preceding 12 months ended December 31 - or since
the Closing Date in the case of the first such statement.
The Administration Agreement will also provide for the delivery to the
Trust, on or before April 30 of each year, beginning April 30, 2000, of a
certificate, signed by an officer of the Administrative Agent, stating that
there has been no Administrative Agent Default during the preceding 12 months
ended December 31 -- or since the Closing Date in the case of the first such
certificate -- or, if there has been any Administrative Agent Default,
describing each such default.
Copies of such statements and certificates may be obtained by Senior
Noteholders or Senior Note Owners by a request in writing addressed to the
Indenture Trustee or the Owner Trustee, as the case may be, at the related
Corporate Trust Office.
SERVICING COMPENSATION
The Administrative Agent will be entitled to compensation for the
performance of its servicing and administrative obligations with respect to the
SUBI Assets under the Administration Agreement. The Administrative Agent will be
entitled to receive a fee in respect of the SUBI Assets allocable to the SUBI
Interest and the Retained SUBI Interest equal to, for each month in the related
Collection Period (each, a "Monthly Period"), one-twelfth of the product of (a)
1.00% and (b) the aggregate Securitization Value of all Specified Leases as of
the first day of that Monthly Period (the "Administration Fee"). The
Administration Fee will be payable on each Payment Date in respect of the three
Monthly Periods comprising the related Collection Period and will be calculated
and paid based upon a 360-day year consisting of twelve 30-day months.
The Administrative Agent will also be entitled to additional
compensation in the form of expense reimbursement, administrative fees or
similar charges paid with respect to the Specified Leases including any late
payment fees now or later in effect. The Administrative Agent will pay all
expenses incurred by it in connection with its servicing and administration
activities under the Administration Agreement and will not be entitled to
reimbursement of such expenses, except to the extent such expenses constitute
Disposition Expenses.
The Administration Fee will compensate the Administrative Agent for
performing the functions of a third party servicer of the Specified Leases as an
agent for the Origination Trust under the Administration Agreement, including
collecting and processing payments, responding to inquiries of Obligors,
investigating delinquencies, sending payment statements, paying costs of the
sale or other disposition of Expired Vehicles and Defaulted Vehicles, overseeing
the SUBI Assets and administering the Specified Leases, including making
Advances, accounting for collections, furnishing monthly and annual statements
to the Origination Trustee with respect to distributions and generating federal
income tax information.
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ADMINISTRATIVE AGENT RESIGNATION AND TERMINATION
The Administrative Agent may not resign from its obligations and duties
under the Administration Agreement unless it determines that its duties
thereunder are no longer permissible by reason of a change in applicable law or
regulations. No such resignation will become effective until a successor
administrative agent has assumed the Administrative Agent's obligations under
the Administration Agreement. The Administrative Agent may not assign the
Administration Agreement or any of its rights, powers, duties or obligations
thereunder except as otherwise provided therein or except in connection with a
consolidation, merger, conveyance, transfer or lease made in compliance with the
Administration Agreement.
The rights and obligations of the Administrative Agent under the
Administration Agreement may be terminated following the occurrence and
continuance of an Administrative Agent Default, as described under
"--Administrative Agent Defaults".
INDEMNIFICATION BY THE ADMINISTRATIVE AGENT
The Administrative Agent will indemnify the Trustees and their
respective agents for any loss, liability, claim, damage or expense that may be
incurred by them as a result of any act or omission by the Administrative Agent
in connection with the performance of its duties under the Administration
Agreement but only to the extent such liability arose out of the Administrative
Agent's negligence, willful misconduct, bad faith or recklessness.
ADMINISTRATIVE AGENT DEFAULTS
The following are among the events that would constitute
"Administrative Agent Defaults" under the Administration Agreement:
(a) any failure by the Administrative Agent to deliver to (1) the
Origination Trustee for distribution to holders of interests in the
UTI, the SUBIs or any Other SUBI, (2) the Indenture Trustee for
distribution to the Noteholders or (3) the Owner Trustee for
distribution to the Certificateholders, any required payment, which
failure continues unremedied for five Business Days after discovery
thereof by an officer of the Administrative Agent or receipt by the
Administrative Agent of notice thereof from the Indenture Trustee,
the Trustee or Senior Noteholders or Certificateholders evidencing
not less than 25% of the aggregate principal balance of the
Securities, voting together as a single class;
(b) any failure by the Administrative Agent to duly observe or perform
in any material respect any other of its covenants or agreements in
the Administration Agreement, which failure materially and
adversely affects the rights of holders of interests in the UTI,
the SUBIs or any Other SUBI or the Senior Noteholders or
Certificateholders, and which continues unremedied for 90 days
after written notice thereof is given as described in clause (a)
above;
(c) any failure by the Administrative Agent to deliver to the
Origination Trustee any report required to be delivered to the
Origination Trustee or the Trust pursuant to the Administration
Agreement within 30 Business Days after the date that report is
due;
(d) any failure to deliver to the Indenture Trustee any report required
to be delivered to the Indenture Trustee or the Trust pursuant to
the Basic Documents, which failure
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continues for 30 Business Days after discovery of that failure by
an officer of the Administrative Agent or receipt by the
Administrative Agent of written notice thereof from the Indenture
Trustee;
(e) any representation, warranty or statement of the Administrative
Agent made in the Administration Agreement, any other Basic
Document to which the Administrative Agent is a party or by which
it is bound or any certificate, report or other writing delivered
pursuant to the Administration Agreement shall prove to be
incorrect in any material respect when made, which failure
materially and adversely affects the rights of holders of interests
in the UTI, the SUBIs or any Other SUBI or the Senior Noteholders
or the Certificateholders, and which failure continues unremedied
for 30 days after written notice thereof is given as described in
clause (a) above;
(f) any failure by the Administrative Agent to maintain or pay when due
any premium in respect of any Contingent and Excess Liability
Insurance Policy; and
(g) the occurrence of certain events of bankruptcy, insolvency,
receivership or liquidation in respect of the Administrative Agent;
provided, however, that the occurrence of any event set forth in
clauses (a) through (f) with respect to either 1999-A SUBI will be
an Administrative Agent Default only with respect to the SUBIs and
will not be an Administrative Agent Default with respect to the UTI
or any Other SUBI.
Notwithstanding the foregoing, a delay in or failure of performance referred to
under clause (b) for a period of 120 days, under clause (c) for a period of 45
Business Days or under clause (e) for a period of 60 days, will not constitute
an Administrative Agent Default if that failure or delay was caused by force
majeure or other similar occurrence. Upon the occurrence of any such event, the
Administrative Agent will not be relieved from using all commercially reasonable
efforts to perform its obligations in a timely manner in accordance with the
terms of the Administration Agreement, and the Administrative Agent will provide
to the Indenture Trustee, the Origination Trustee, the Transferor and the
Securityholders prompt notice of such failure or delay by it, together with a
description of its efforts to so perform its obligations.
Upon the occurrence of any Administrative Agent Default, the sole
remedy available to the holders of the UTI, the SUBIs and any Other SUBIs will
be to remove the Administrative Agent and appoint a successor Administrative
Agent. However, if the commencement of a bankruptcy or similar case or
proceeding were the only default, the Administrative Agent or its
trustee-in-bankruptcy might have the power to prevent that removal. See
"--Removal or Replacement of the Administrative Agent".
TERMINATION
The Administration Agreement will terminate upon the earlier to occur
of (a) the dissolution of the Origination Trust or (b) the discharge of the
Administrative Agent in accordance with the terms of the Administration
Agreement, which will effect a termination only with respect to the SUBI Assets
and not with respect to any other Origination Trust Assets.
REMOVAL OR REPLACEMENT OF THE ADMINISTRATIVE AGENT
Upon the occurrence of an Administrative Agent Default, the Origination
Trustee may, to the extent such Administrative Agent Default relates (a) to all
Origination Trust Assets, upon the
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direction of the holders of the SUBIs, the UTI and any Other SUBI - excluding
Ryder, the UTI Beneficiaries or any other affiliate of the Administrative Agent
- - terminate all of the rights and obligations of the Administrative Agent under
the Administration Agreement with respect to all Origination Trust Assets or (b)
only to the SUBI Assets, upon the direction of the holder and pledge of the SUBI
Certificates, terminate all of the rights and obligations of the Administrative
Agent under the Administration Agreement with respect to the SUBI Assets. For
purposes of the immediately preceding sentence, the holder and pledgee of the
SUBI Certificates will be the Indenture Trustee acting at the direction of
Senior Noteholders holding not less than 66?% of the aggregate principal balance
of the Senior Notes, so long as any Senior Notes are outstanding. In each case,
the Origination Trustee will effect that termination by delivering notice
thereof to the Administrative Agent, with a copy to each Rating Agency or any
other securities based on any Other SUBIs affected by that Administrative Agent
Default.
Upon the termination or resignation of the Administrative Agent, the
Administrative Agent subject to that termination or removal will continue to
perform its functions as Administrative Agent, in the case of (a) termination,
until the earlier of the date specified in the termination notice or, if no such
date is specified therein, the date of the Administrative Agent's receipt of
such notice, and (b) resignation, until the later of (1) 45 days after the
delivery to the Origination Trustee of the written resignation notice or (2) the
date upon which the resigning Administrative Agent becomes unable to act as
Administrative Agent, as specified in the resignation notice and accompanying
opinion of counsel.
In the event of a termination of the Administrative Agent as a result
of an Administrative Agent Default with respect to the SUBI Assets only, the
Origination Trustee, acting at the direction of the holder and pledgee of the
SUBI Certificates -- which holder for this purpose will be the Indenture
Trustee, acting at the direction of Senior Noteholders holding not less than
66?% of the aggregate principal balance of the Senior Notes -- will appoint a
successor Administrative Agent. The Origination Trustee will have the right to
approve that successor Administrative Agent, and that approval may not be
unreasonably withheld. If a successor Administrative Agent is not appointed by
the effective date of the predecessor Administrative Agent's resignation or
termination, then the Origination Trustee will act as successor Administrative
Agent. If the Origination Trustee is legally unable to act as Administrative
Agent, then the Origination Trustee will be required to appoint, or petition a
court of competent jurisdiction to appoint, any established entity the regular
business of which includes the servicing of truck, tractor and trailer leases as
the successor Administrative Agent.
Upon appointment of a successor Administrative Agent, the successor
Administrative Agent will assume all of the rights and obligations of the
Administrative Agent under the Administration Agreement; provided, however, that
no successor Administrative Agent will have any responsibilities with respect to
the purchase of additional Leases or Vehicles by the Origination Trust or with
respect to making Advances. Any compensation payable to a successor
Administrative Agent may not be in excess of that permitted the predecessor
Administrative Agent unless the holders of the UTI, the SUBIs and any Other
SUBIs, as the case may be, bear such excess costs exclusively. If a bankruptcy
trustee or similar official has been appointed for the Administrative Agent,
that trustee or official may have the power to prevent the Indenture Trustee,
the Owner Trustee, the Senior Noteholders or the Certificateholders from
effecting that transfer of servicing. The predecessor Administrative Agent will
have the right to be reimbursed for any outstanding Advances made with respect
to the SUBI Assets to the extent funds are available therefore in respect of the
Advances made.
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MISCELLANEOUS PROVISIONS
AMENDMENT PROVISIONS
GENERAL. For so long as any Senior Notes are outstanding, the Trust's
rights in the SUBI Certificates will be subject to the lien of the Indenture.
The Indenture Trustee will be the holder of the SUBI Certificates for purposes
of determining whether any proposed amendment to the SUBI Trust Agreement, the
Administration Agreement or the Trust Agreement will materially adversely affect
the interests of the holders of the SUBI Certificates.
AMENDMENT OF THE SUBI TRUST AGREEMENT AND THE ADMINISTRATION AGREEMENT.
Each of the SUBI Trust Agreement and the Administration Agreement may be amended
without the consent of the holders of the Senior Notes, the Certificateholders,
the SUBI Certificates, the UTI Certificates or any Other SUBI Certificates, as
the case may be, to cure any ambiguity, correct or supplement any provision
therein that may be inconsistent with any other provision therein, add any other
provisions with respect to matters or questions arising under the related
agreement that are not inconsistent with the provisions of the respective
agreements or add or amend any provision that provides additional rights to any
of such holders; provided, that any such action will not, in the good faith
judgment of the parties thereto, materially and adversely affect the interest of
any of such holders, or upon the delivery of an opinion of counsel to the effect
that such amendment will not adversely and materially affect the interest of any
such holder. Each of the SUBI Trust Agreement and the Administration Agreement
may also be amended from time to time as it relates to either 1999-A SUBI, by
the parties thereto, including to change the manner in which the Residual Value
Surplus Account or the Reserve Fund is funded, including the elimination of the
Residual Value Surplus Account or the Reserve Fund, or to change the remittance
schedule for depositing Collections and other amounts into the SUBI Collection
Account,
o upon confirmation from each Rating Agency to the effect that such
amendment would not cause its then-current rating on the Senior
Notes or Certificates to be qualified, reduced or withdrawn, or
o upon receipt of the consent of Senior Noteholders holding at least
a majority of the aggregate principal balance of the Senior Notes
and, to the extent affected thereby, the consent of
Certificateholders holding at least a majority of the aggregate
principal balance of the Certificates,
for the purpose of adding any provision to, or changing in any manner or
eliminating any provision of, the agreements or modifying in any manner the
rights of the Senior Notes or Certificates; provided, however, that
o no such amendment may increase or reduce in any manner the amount
of, or accelerate or delay the timing of, collections of payments
in respect of the SUBI Interest or the SUBI Certificates,
distributions required to be made on the Senior Notes or the
Certificates or the Interest Rate or the Certificate Rate,
o no amendment of any type shall reduce the percentage of the
aggregate principal amount of the Senior Notes and the Certificates
required to consent to any such amendment, in each case without the
consent of all the holders or 100% of all outstanding Senior Notes
or Certificates, as the case may be, and
o an opinion of counsel as to certain tax matters is delivered.
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To the extent that any such amendment also relates to or affects the UTI or any
Other SUBI, such amendment will require the consent of the holders affected
thereby. Notwithstanding the foregoing, the SUBI Trust Agreement and the
Administration Agreement may be amended at any time by the parties thereto to
the extent reasonably necessary to assure that none of the Origination Trust,
the Trust or the Transferor will be classified as an association, or a publicly
traded partnership, taxable as a corporation for federal income tax purposes.
AMENDMENT OF TRUST AGREEMENT. The Trust Agreement may be amended by the
Transferor and the Owner Trustee without the consent of any of the Senior
Noteholders or Certificateholders to cure any ambiguity, correct or supplement
any provision herein that may be inconsistent with any other provision in the
Trust Agreement, add any other provisions with respect to matters or questions
arising under the Trust Agreement that are not inconsistent with the provisions
of the Trust Agreement or add or amend any provision in the agreement in
connection with permitting transfers of the Subordinated Notes or the
Certificates; provided, however, that such action shall not, as evidenced by an
opinion of counsel, materially adversely affect the interests of the holders of
the SUBI Certificates or the Retained SUBI Certificates -- which, so long as any
Senior Notes are outstanding, shall include the Indenture Trustee -- or any the
Senior Notes or Certificates.
The Trust Agreement may also be amended from time to time by the
Transferor and the Owner Trustee,
o with prior written notice to each Rating Agency and confirmation
from each Rating Agency that such amendment would not cause the
then-current ratings assigned to the Senior Notes and the
Certificates to be qualified, reduced or withdrawn,
o with the consent of the Senior Noteholders holding at least a
majority of the aggregate principal balance of the Senior Notes and
o to the extent affected thereby, the consent of the holders of the
Subordinated Notes holding at least a majority of the aggregate
principal balance of the Subordinated Notes, and Certificateholders
holding at least a majority of the aggregate principal balance of
the Certificates,
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Trust Agreement or of modifying in any
manner the rights of the Senior Noteholders, the Certificateholders or the
holders of the Subordinated Notes. No such amendment shall, however,
o increase or reduce in any manner the amount of, or accelerate or
delay the timing of, distributions that are required to be made on
the Notes or the Certificates, or
o reduce the percentage of the Senior Noteholders, holders of the
Subordinated Notes or Certificateholders required to consent to any
such amendment,
without the consent of the holders of 100% of all outstanding Certificates other
than the Transferor Certificate, and provided, further that an opinion of
counsel shall be furnished to the Indenture Trustee and the Owner Trustee to the
effect that such amendment shall not (1) affect the treatment of the Senior
Notes as debt for federal income tax purposes, (2) be deemed to cause a taxable
exchange of the Senior Notes for federal income tax purposes or (3) cause the
Trust or the SUBI Certificates to be classified as an association, or a publicly
traded partnership, taxable as a corporation for federal income tax purposes.
Notwithstanding the foregoing, the Trust Agreement may be amended at any time by
the parties thereto to the extent reasonably necessary to assure that none of
the Origination Trust, the Trust or the Transferor will be classified as an
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association, or a publicly traded partnership, taxable as a corporation for
federal income tax purposes.
The Trust Agreement may also be amended from time to time to approve
additional Trust activities and purposes upon the request of holders of at least
75% of the outstanding balance of the Certificates provided, however, that any
such amendment will also require
o that each Rating Agency have delivered a letter to the effect that
the activities and purposes would not cause its then-current
ratings of the Senior Notes or the Certificates to be qualified,
reduced or withdrawn, and
o approval by holders of at least 75% of the outstanding balance of
the Senior Notes, or if the Senior Notes are no longer outstanding,
by the Subordinated Noteholder.
See "The Trust--Formation".
The Trust Agreement will require the Owner Trustee to give the
Certificateholders 30 days' written notice of any proposed supplement to the
Indenture which would materially adversely affect the Certificateholders if the
consent of the Senior Noteholders is not required or any other amendment or
supplement to any other Basic Document unless the Owner Trustee is furnished
with an opinion of counsel that such amendment or supplement would not
materially adversely affect the Certificateholders. The Trust Agreement provides
that the Owner Trustee will not enter into such amendment unless
Certificateholders holding 25% or more of the aggregate principal balance of the
Certificates consent in writing.
AMENDMENT OF INDENTURE. Without the consent of the Senior Noteholders
but with prior notice to each Rating Agency, the Owner Trustee, on behalf of the
Trust, and the Indenture Trustee, upon request by the Trust, may execute a
supplemental indenture for the purpose of adding to the covenants of the Trust,
curing any ambiguity, correcting or supplementing any provision that may be
inconsistent with any other provision or adding any other provision with respect
to matters or questions arising under the Indenture that will not be
inconsistent with other provisions of the Indenture.
Without the consent of the holder of each outstanding Senior Note
affected thereby, no supplemental indenture may:
o change the Final Payment Date of, or Interest Rate on, reduce the
principal amount thereof, or the Redemption Price with respect
thereto or change any place of payment where, or the coin or
currency in which, the Senior Notes or the interest thereon is
payable:
o impair any right to institute suit for the enforcement of certain
provisions of the Indenture regarding payment:
o reduce the percentage of the aggregate principal balance of the
Senior Notes the consent of the holders of which is required for
any supplemental indenture or for any waiver of compliance with
certain provisions of the Indenture or of certain defaults
thereunder and their consequences as provided for therein:
o modify or alter the provisions of the Indenture regarding the
voting of Senior Notes held by the Transferor, the Administrative
Agent or any of their respective affiliates or any obligor on the
Senior Notes:
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o reduce the percentage of the aggregate principal balance of Senior
Notes the consent of the holders of which is required to direct the
Indenture Trustee to sell or liquidate the Trust Estate, if the
proceeds of that sale would be insufficient to pay the aggregate
principal balance and accrued but unpaid interest on the Senior
Notes:
o decrease the percentage of the aggregate principal balance of
Senior Notes required to amend the sections of the Indenture that
specify the applicable percentage of the aggregate principal
balance of Senior Notes necessary to amend the Indenture or the
other Basic Documents; or
o permit the creation of any lien ranking prior to or on a parity
with the lien of the Indenture with respect to any of the
collateral for the Senior Notes or, except as otherwise permitted
by or contemplated in the Indenture, terminate the lien of the
Indenture on any such collateral or deprive the holder of any
Senior Note of the security afforded by the lien of the Indenture.
The Trust and the Indenture Trustee may also enter into supplemental
indentures, with the consent of holders of at least a majority of the aggregate
principal balance of the Senior Notes, and with written notice to each Rating
Agency, for the purpose of adding any provision to, changing in any manner or
eliminating any provision of the Indenture or for the purpose of modifying in
any manner the rights of the Senior Noteholders; provided, that
o such action will not, (1) as evidenced by an opinion of counsel,
materially adversely affect the interests of any Senior Noteholder
and (2) as confirmed by each Rating Agency, cause the then-current
ratings assigned to the Senior Notes or the Certificates to be
qualified, reduced or withdrawn, and
o an opinion of counsel as to certain tax matters is delivered.
AMENDMENT OF THE PROGRAM OPERATING LEASE. The Program Operating Lease
may be amended without the consent of the Senior Noteholders or the
Certificateholders; provided, however, that
o such amendment may not, as evidenced by an opinion of counsel,
materially adversely affect the interests of the Senior Noteholders
or the Certificateholders, unless 100% of the Senior Noteholders
and Certificateholders materially adversely affected consent
thereto,
o as confirmed by each Rating Agency, that amendment will not cause
the then-current rating assigned to any Senior Notes or the
Certificates to be qualified, withdrawn or reduced, and
o an opinion of counsel as to certain tax matters is delivered.
Notwithstanding the foregoing, the Program Operating Lease may be amended at any
time by the parties thereto to the extent reasonably necessary to ensure that
none of Origination Trust, the Trust or the Transferor will be classified as an
association, or a publicly traded partnership, taxable as a corporation for
federal income tax purposes.
SUBI CERTIFICATE TRANSFER AGREEMENT. The SUBI Certificate Transfer
Agreement may be amended from time to time by the parties thereto.
ISSUER SUBI CERTIFICATE TRANSFER AGREEMENT. The Issuer SUBI Certificate
Transfer Agreement may be amended from time to time by the parties thereto.
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BANKRUPTCY PROVISIONS
THE UTI BENEFICIARIES AND THE ORIGINATION TRUST. The Trustees, the UTI
Beneficiaries, any Paying Agent, the Transferor, the Trust Agent, Ryder, the
Administrative Agent, each holder of an interest in the SUBI, an Other SUBI or
the UTI, and each Securityholder, by accepting the related Security
(collectively, the "Non-Petition Parties") will covenant that for a period of
one year and one day after payment in full of all amounts due to each holder or
pledgee of an interest in the UTI, the SUBIs or any Other SUBI, they will not
institute, or join in instituting, any bankruptcy, reorganization, insolvency or
liquidation proceeding or other similar proceeding against either UTI
Beneficiary or the Origination Trust. Notwithstanding the foregoing, each
Securityholder, the Indenture Trustee and the Owner Trustee may institute or
join any such proceeding if 100% of the holders of the SUBI and any Other SUBIs
consent, excluding the UTI Beneficiaries, the Transferor and any of their
respective affiliates. Each pledgee of the UTI, the SUBIs or any Other SUBI must
give a similar non-petition covenant.
THE TRANSFEROR AND THE TRUST. Each of the Administrative Agent, the
Transferor, the Owner Trustee, the Indenture Trustee and each Securityholder, by
accepting the related Security, will covenant not to institute or join in
instituting any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding, or other similar proceeding against the Transferor or
the Trust for a period of one year and one day after the Senior Notes and the
Certificates have been paid in full; provided, however, that 100% of the Senior
Noteholders, or, if no Senior Notes are then outstanding, the Subordinated
Noteholder, or, if no Notes are then outstanding, 100% of the
Certificateholders, in each case excluding the Transferor and any of its
affiliates, may at any time institute or join in instituting any bankruptcy,
reorganization, insolvency or liquidation proceeding against the Transferor or
the Trust.
SENIOR NOTES OR CERTIFICATES OWNED BY THE TRUST, TRANSFEROR,
ADMINISTRATIVE AGENT OR THEIR AFFILIATES
Any Senior Notes or Certificates owned by the Trust, the Transferor,
the Administrative Agent or any of their respective affiliates will be entitled
to benefits under the Indenture or the Trust Agreement, as the case may be,
equally and proportionately to the benefits afforded other owners of the Senior
Notes or Certificates, respectively, except that such Senior Notes or
Certificates will be deemed not to be outstanding for the purpose of determining
whether the requisite percentage of Senior Noteholders or Certificateholders, as
the case may be, have given any request, demand, authorization, direction,
notice, consent or other action under the Basic Documents.
FEES AND EXPENSES
THE ORIGINATION TRUSTEE. The Origination Trustee will be entitled to
reasonable compensation for its services with respect to the SUBI Assets, which
will be paid by the Administrative Agent, the amount of which will be agreed
upon from time to time by the Origination Trustee and the Administrative Agent.
THE ADMINISTRATIVE AGENT. As more fully described under "--The
Administration Agreement--Servicing Compensation", as compensation for the
servicing of the SUBI Assets and administering the distribution of funds in
respect thereof, the Administrative Agent will be entitled to receive the
Administration Fee on each Payment Date, together with reimbursement of
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fees and expenses and any late payment fees now or later in effect or similar
charges paid with respect to the Specified Leases.
The Administrative Agent will pay all expenses incurred by it in the
performance of its duties under the Administration Agreement, including fees and
disbursements of independent accountants, taxes imposed on the Administrative
Agent and expenses incurred in connection with distributions and reports to the
Trustees. The Administrative Agent will pay the fees and expenses of the
Trustees.
THE INDENTURE TRUSTEE. As more fully described under "Additional
Document Provisions--The Indenture--Compensation and Indemnity", the
Administrative Agent or the Administrator will pay the Indenture Trustee
compensation for its services and reimburse it for its reasonable expenses
relating thereto.
THE OWNER TRUSTEE AND PAYING AGENT. The Administrator will pay the
Owner Trustee and each Paying Agent such fees as have been agreed upon among the
Transferor, the Administrator and the Owner Trustee or the Paying Agent, and
will reimburse the Owner Trustee and each Paying Agent for their reasonable
expenses. The Administrator will not be entitled to be reimbursed from the Trust
Estate for the payment of such expenses.
GOVERNING LAW. The SUBI Trust Agreement and the Trust Agreement will be
governed by the laws of the State of Delaware. The Administration Agreement, the
Indenture, the SUBI Certificate Transfer Agreement, the Issuer SUBI Certificate
Transfer Agreement and the Program Operating Lease will be governed by the laws
of the State of New York.
CERTAIN LEGAL ASPECTS OF THE ORIGINATION TRUST AND THE SUBIs
THE ORIGINATION TRUST
GENERAL
The Origination Trust is a business trust under Delaware law. In a
business trust, the trust property is managed for the profit of the
beneficiaries, as opposed to a common law "asset preservation" trust, where the
trustee is charged with the mere maintenance of trust property. The principal
requirement for the formation of a business trust in Delaware is the execution
of a trust agreement and the filing of a Certificate of Trust with the Secretary
of State of the State of Delaware. The Origination Trust has been so formed. The
Origination Trust has also made trust filings or obtained certificates of
authority to transact business in some states where, in the judgment of the
Administrative Agent, such action may be required.
Because the Origination Trust has been registered as a business trust
for Delaware and other state law purposes, it, like a corporation, may be
eligible to be a debtor in its own right under the United States Bankruptcy Code
(the "Bankruptcy Code"), as further described under "--Insolvency-Related
Matters". To the extent that the Origination Trust may be eligible for relief
under the Bankruptcy Code or similar applicable state laws (the "Insolvency
Laws"), the Origination Trustee is not authorized to commence a case or
proceeding thereunder. Each of the Origination Trustee, the UTI Beneficiaries
and the holders from time to time of the UTI, the SUBIs and any Other SUBI have
agreed not to institute a case or proceeding against the Origination Trust under
any Insolvency Law for a period of one year and one day after payment in full of
all distributions to holders of the UTI, the SUBIs and any Other SUBI under the
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Origination Trust Agreement. See "Additional Document Provisions--Miscellaneous
Provisions--Bankruptcy Provisions".
ALLOCATION OF ORIGINATION TRUST LIABILITIES
The Origination Trust Assets may in the future be comprised of several
portfolios of Other SUBI Assets, together with the SUBI Assets and the UTI
Assets. The UTI Beneficiaries may in the future pledge the UTI as security for
obligations to third-party lenders, and may in the future create and sell or
pledge Other SUBIs in connection with other financings. The Origination Trust
Agreement will permit the Origination Trust, in the course of its activities, to
incur certain liabilities relating to its assets other than the SUBI Assets, or
relating to its assets generally. Pursuant to the Origination Trust Agreement,
as among the beneficiaries of the Origination Trust, an Origination Trust
liability relating to a particular portfolio of Origination Trust Assets will be
allocated to and charged against the portfolio of Origination Trust Assets to
which it belongs. Origination Trust liabilities incurred with respect to the
Origination Trust Assets generally will be borne pro rata among all portfolios
of Origination Trust Assets. The Origination Trustee and the beneficiaries of
the Origination Trust, including the Trust, will be bound by that allocation. In
particular, the Origination Trust Agreement will require the holders from time
to time of the UTI Certificates and any Other SUBI Certificates to waive any
claim they might otherwise have with respect to the SUBI Assets and to fully
subordinate any claims to the SUBI Assets in the event that such waiver is not
given effect. Similarly, by virtue of holding Senior Notes or a beneficial
interest therein, Senior Noteholders, and Note Owners will be deemed to have
waived any claim they might otherwise have with respect to the UTI Assets or any
Other SUBI Assets. See "Additional Document Provisions--The SUBI Trust
Agreement--The SUBIs, Other SUBIs and the UTI".
The Origination Trust Assets are located in several states, the tax
laws of which vary. Additionally, the Origination Trust may in the future own
Leases and Vehicles located in states other than the states in which it conducts
business as of the date of this prospectus. In the event any state or locality
imposes a tax on the Origination Trust at the entity level, the UTI
Beneficiaries have agreed to indemnify the holders of the SUBI Certificates, the
Retained SUBI Certificates and each Other SUBI Certificates for the full amount
of such taxes. Should the UTI Beneficiaries fail to fulfill their respective
indemnification obligations, amounts otherwise distributable to them as holders
of the UTI Certificates will be applied to satisfy such obligations. However, it
is possible that Senior Noteholders could incur a loss on their investment in
the event the UTI Beneficiaries did not have sufficient assets available,
including distributions in respect of the UTI, to satisfy such state or local
tax liabilities.
The Origination Trust Agreement provides for the UTI Beneficiaries to
be liable as if the Origination Trust were a partnership and the UTI
Beneficiaries were general partners of the partnership to the extent necessary
after giving effect to the payment of liabilities allocated severally to the
holders of the SUBI Certificates, the Retained SUBI Certificates and any Other
SUBI Certificates. However, it is possible that the Senior Noteholders and
Certificateholders could incur a loss on their investment to the extent any such
claim were allocable to the Trust as the holder of the Vehicle SUBI Certificate
or the pledgee of the Lease SUBI Certificate, either because a lien arose in
connection with the SUBI Assets or in the event the UTI Beneficiaries did not
have sufficient assets available, including distributions in respect of the UTI,
to satisfy such claimant or creditor in full.
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THE SUBIs
The SUBIs will evidence a beneficial interest in the related SUBI
Assets. The SUBIs will represent neither a direct legal interest in the related
SUBI Assets, nor an interest in any Origination Trust Assets other than the
related SUBI Assets. Under the allocation of Origination Trust liabilities
described under "Additional Document Provisions--The SUBI Trust Agreement--The
SUBIs, Other SUBIs and the UTI", payments made on or in respect of such other
Origination Trust Assets will not be available to make payments on the Senior
Notes or to cover expenses of the Origination Trust allocable to the SUBI
Assets. Any liability to third parties arising from or in respect of a Specified
Lease or a Specified Vehicle will be borne by the holders of the SUBI Interest,
including the Trust, and the Retained SUBI Interest. If any such liability
arises from a Lease or Vehicle that is an Other SUBI Asset or an UTI Asset, the
SUBI Assets will not be subject to such liability.
Because the Trust's primary asset will be the Vehicle SUBI Certificate
and its rights as a pledgee of the Lease SUBI Certificate, the Trust, and,
accordingly, the Indenture Trustee, will have an indirect beneficial ownership
interest, rather than a security interest, in the SUBI Assets allocable to the
SUBI Interest. Except as otherwise described below or under "Certain Legal
Aspects of the Specified Leases and Specified Vehicles", generally the Trust
will not have a perfected security interest in the SUBI Assets, and in no
circumstances will the Trust have a direct ownership or perfected security
interest in any Specified Vehicle.
The Trust will generally be deemed to own the Vehicle SUBI Certificate
and, through such ownership, to have an indirect beneficial ownership interest
in the Specified Vehicles. If a court of competent jurisdiction were to
recharacterize the sale of the Vehicle SUBI Certificate and the SUBI Interest
evidenced thereby to the Trust, the Trust, or, during the term of the Indenture,
the Indenture Trustee, could instead be deemed to have a perfected security
interest in the Vehicle SUBI Certificate, and certain rights susceptible of
perfection under the UCC, but in no event would the Trust or the Indenture
Trustee be deemed to have a perfected security interest in the Specified
Vehicles.
Because the Trust will not directly own the SUBI Assets, and because
its interest therein will generally be an indirect beneficial ownership
interest, perfected liens of third-party creditors of the Origination Trust in
SUBI Assets will take priority over the interests of the Trust and the Indenture
Trustee in the SUBI Assets. Therefore, a general creditor of the Origination
Trust may obtain a lien on one or more SUBI Assets, regardless of whether its
claim would be allocated to such SUBI Assets under the terms of the Origination
Trust Agreement. Such liens could include liens arising under various federal
and state criminal statutes, certain liens in favor of the Pension Benefit
Guaranty Corporation and judgment liens resulting from successful claims against
the Origination Trust arising from the operation of the Specified Vehicles. See
"Risk Factors--Liens may be imposed on the trust's assets due to ERISA
liabilities" and "--Vicarious tort liability may result in a loss of your
investment" and "Certain Legal Aspects of the Specified Leases and the Specified
Vehicles--Vicarious Tort Liability" for a further discussion of these risks.
INSOLVENCY-RELATED MATTERS
As described under "Additional Document Provisions--The SUBI Trust
Agreement--The SUBIs, Other SUBIs and the UTI" and "--The SUBIs", each holder or
pledgee of the UTI
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Certificates and any Other SUBI Certificate will be required to expressly
disclaim any interest in the SUBI Assets and to fully subordinate any claims to
the SUBI Assets in the event that disclaimer is not given effect. Although no
assurances can be given, in the unlikely event of the bankruptcy of RTR I LP,
the Transferor believes that the SUBI Assets would not be treated as part of RTR
I LP's bankruptcy estate and that, even if they were so treated, the
subordination by the holders and pledgees of the UTI Certificates and any Other
SUBI Certificate would be enforceable. In addition, as described under "Risk
Factors--A bankruptcy of the transferor or administrative agent could delay or
limit payments on the senior notes", each of RTR I LP, the Origination Trust, or
the Origination Trustee when acting on its behalf, and the Transferor has taken
steps in structuring the transactions described herein and has undertaken to act
throughout the life of such transactions in a manner intended to ensure that in
the event a voluntary or involuntary case is commenced by or against Ryder under
the Insolvency Laws, the separate legal existence of each of Ryder, on the one
hand, and the Origination Trust, RTR I LP and the Transferor, on the other hand,
will be maintained such that none of the respective assets and liabilities of
the Origination Trust, RTR I LP or the Transferor should be consolidated with
those of Ryder.
With respect to RTR I LLC and RTR III LLC, these steps include their
creation as separate limited liability companies under limited liability company
agreements containing certain limitations, including, the requirement that each
must have at all times a managing member that is a corporation with at least two
independent directors, and restrictions on the nature of their businesses and
operations and on their ability to commence a voluntary case or proceeding under
any Insolvency Law without the unanimous affirmative vote of all members,
including each independent member. With respect to RTR I LP and the Transferor,
these steps include their creation as separate, special purpose limited
partnerships, pursuant to limited partnership agreements containing certain
limitations (including, restrictions on the nature of their respective
businesses and on their ability to commence a voluntary case or proceeding under
any Insolvency Law without the unanimous affirmative vote of all members of
their respective general partners, including each independent director of each
managing member).
There can be no assurance, however, that the limitations on the
activities of RTR I LP, the Origination Trust and the Transferor, as well as the
restrictions on their abilities to obtain relief under Insolvency Laws or lack
of eligibility thereunder, as described above, would prevent a court from
concluding that their assets and liabilities should be consolidated with those
of Ryder, if Ryder becomes the subject of a case or proceeding under any
Insolvency Law. On the Closing Date, Brown & Wood LLP, as special counsel to the
Transferor, will deliver an opinion based on a reasoned analysis of analogous
case law - although there is no precedent based on directly similar facts - to
the effect that, subject to certain facts, assumptions and qualifications
specified in the opinion, under present reported decisional authority and
applicable statutes to federal bankruptcy cases, if Ryder were to become a
debtor in a case under the Bankruptcy Code, it would not be a proper exercise by
a court of its equitable discretion (a) to disregard the separate legal
existence of any of the Origination Trust, RTR I LP or the Transferor from that
of Ryder and (b) to order the substantive consolidation of the assets and
liabilities of any of the Origination Trust, RTR I LP or the Transferor with the
assets and liabilities of Ryder. Among other things, that opinion will assume
that each of the Origination Trust, or the Origination Trustee when acting on
its behalf, RTR I LP and the Transferor will follow certain procedures in the
conduct of its affairs, including maintaining separate records and books of
account from those of Ryder, not commingling its respective assets with those of
Ryder, doing business in a separate office from Ryder and not holding itself out
as having agreed to pay, or being liable for,
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the debts of Ryder. In addition, that opinion will assume that except as
expressly provided by the Origination Trust Agreement and the Administration
Agreement - each of which contains terms and conditions consistent with those
that would be arrived at on an arm's length basis between unaffiliated entities
in the belief of the parties thereto - Ryder generally will not guarantee the
obligations of the Origination Trust, RTR I LP or the Transferor to third
parties, and will not conduct the day-to-day business or activities of any
thereof, other than in its capacity as Administrative Agent acting under and in
accordance with the Administration Agreement. Each of Ryder, the Origination
Trust, RTR I LP and the Transferor intends to follow and has represented that it
will follow these and other procedures related to maintaining the separate
identities and legal existences of each of the Origination Trust, RTR I LP and
the Transferor. Such a legal opinion, however, will not be binding on any court.
If a case or proceeding under any Insolvency Law were to be commenced
by or against any of Ryder, the Origination Trust, RTR I LP or the Transferor,
if a court were to order the substantive consolidation of the assets and
liabilities of any of such entities with those of Ryder or if an attempt were
made to litigate any of the foregoing issues, delays in distributions on the
SUBI Certificates, and possible reductions in the amount of such distributions,
to the Trust - either directly or, if the Program Operating Lease remains in
effect, indirectly to the extent resulting in delayed or reduced Program
Operating Lease Payments from the Transferor to the Trust - and therefore to the
Senior Noteholders, could occur. In addition, the SUBI Trust Agreement provides
that if the Transferor becomes bankrupt or insolvent or the Trust is dissolved -
which could occur as a result of the bankruptcy of the Transferor - the SUBI
will be terminated and the SUBI Trust Agreement will terminate with respect to
the SUBI. In each case, the Origination Trustee will be required to distribute
the SUBI Assets to the holders of the SUBI Certificates. Because the Trust has
pledged its rights in and to the SUBI Certificates to the Indenture Trustee,
such distribution would be made to the Indenture Trustee, which would be
responsible for retitling the Specified Vehicles. The cost of that retitling
would reduce amounts payable from the SUBI Assets that are available for
payments of interest on and principal of the Senior Notes, and in that event,
the Senior Noteholders could suffer a loss on their investment.
RTR I LP will treat its conveyance of the SUBI Certificates to the
Transferor as an absolute sale, transfer and assignment of all of its interest
therein for all purposes. However, if a case or proceeding under any Insolvency
Law were commenced by or against RTR I LP, and RTR I LP as debtor-in-possession
or a creditor, receiver or bankruptcy trustee of RTR I LP were to take the
position that the sale, transfer and assignment of the SUBI Certificates by RTR
I LP to the Transferor should instead be treated as a pledge of the SUBI
Certificates to secure a borrowing by RTR I LP, delays in payments of proceeds
of the SUBI Certificates to the Trust, and therefore to the Senior Noteholders,
could occur or, should the court rule in favor of that position, reductions in
the amount of such payments could result. On the Closing Date, Brown & Wood LLP,
as special counsel to the Transferor, will deliver an opinion to the effect
that, subject to certain facts, assumptions and qualifications specified
therein:
o In the event that the Transferor were to become a debtor in a case
under the Bankruptcy Code subsequent to the sale, transfer and
assignment of the Vehicle SUBI Certificate to the Trust, the sale,
transfer and assignment of the Vehicle SUBI Certificate from the
Transferor would be characterized as an absolute sale, transfer and
assignment of the SUBI Certificate from the Transferor to the Trust,
and the Vehicle SUBI Certificate and the proceeds thereof would not
be property of the Transferor's bankruptcy estate;
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o In the event that RTR I LP were to become a debtor in a case under
the Bankruptcy Code subsequent to the sale, transfer and assignment
of the SUBI Certificates to the Transferor, the sale, transfer and
assignment of the SUBI Certificates from RTR I LP would be
characterized as an absolute sale, transfer and assignment of the
SUBI Certificates from RTR I LP to the Transferor, and the SUBI
Certificates and the proceeds thereof would not be property of RTR I
LP's bankruptcy estate; and
o In the event that Ryder were to become a debtor in a case under the
Bankruptcy Code subsequent to Ryder's sale, transfer and assignment
of the Specified Vehicles and Specified Leases to the Origination
Trust, the sale, transfer and assignment of the Specified Vehicles
and Specified Leases from Ryder would be characterized as an
absolute sale, transfer and assignment of the Specified Vehicles and
Specified Leases from Ryder to the Origination Trust, and the
Specified Vehicles, the Specified Leases or the proceeds thereof
would not be property of the Transferor 's bankruptcy estate.
As indicated above, however, such a legal opinion is not binding on any court.
As a precautionary measure, the Transferor will take the actions
requisite to obtaining a security interest in the SUBI Certificates as against
RTR I LP which the Transferor will assign to the Trust and the Trust will assign
to the Indenture Trustee. The Indenture Trustee will perfect its security
interest in each SUBI Certificate, which will each be a "certificated security"
under the UCC, by possession. Accordingly, if the conveyance of the SUBI
Certificates by RTR I LP to the Transferor were not respected as an absolute
sale, transfer and assignment, the Transferor, and ultimately the Trust and the
Indenture Trustee as successors in interest, should be treated as a secured
creditor of RTR I LP, although a case or proceeding under any Insolvency Law
with respect to RTR I LP could result in delays or reductions in distributions
on the SUBI Certificates as indicated above, notwithstanding such perfected
security interest.
In the event that the Administrative Agent were to become subject to a
case under the Bankruptcy Code, some payments made within one year of the
commencement of such case, including Advances, Reallocation Payments and
payments made with respect to the Titling Grace Period Vehicles which were not
properly retitled during the Titling Grace Period, may be recoverable by the
Administrative Agent as debtor-in-possession or by a creditor or a trustee in
bankruptcy as a preferential transfer from the Administrative Agent. See "Risk
Factors--A bankruptcy of the transferor or the administrative agent could delay
or limit payments on the senior notes".
CERTAIN LEGAL ASPECTS OF THE SPECIFIED LEASES AND THE SPECIFIED VEHICLES
BACK-UP SECURITY INTERESTS
Because the Trust will own the Vehicle SUBI Certificate, the Trust will
have an indirect beneficial interest, rather than a security interest, in the
Vehicle SUBI Assets. The Trust also will be a pledgee of the Lease SUBI
Certificate held by Transferor which in turn will have an indirect beneficial
interest, rather than a security interest, in the Lease SUBI Assets. Except as
otherwise described below, the Owner Trustee generally will not have a perfected
security interest in the property of the Trust or the SUBI Assets and in no
circumstances will the Owner Trustee have a perfected security interest in any
Specified Vehicle.
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As described under "Certain Legal Aspects of the Origination Trust and
the SUBIs", the Indenture Trustee will have a security interest in the SUBI
Certificates perfected by possession.
The SUBI Assets will consist principally of the Specified Leases and
the related Specified Vehicles, subject to the rights of the Obligors under the
Specified Leases. To the extent that the pledge of the Lease SUBI Certificate
were to be viewed as representing a transfer of the assets of the Origination
Trust, the Specified Leases would be "chattel paper" as defined in the UCC.
Pursuant to the UCC, a non-possessory security interest in chattel paper may be
perfected by filing a UCC-1 financing statement with the appropriate filing
office in the state where the debtor has its chief executive office.
Accordingly, as a precaution, UCC-1 financing statements relating to the
Specified Leases will be filed naming:
o the Origination Trust as debtor and the Indenture Trustee as
assignee secured party;
o RTR I LP as debtor and the Indenture Trustee as assignee secured
party;
o the Transferor as debtor and the Indenture Trustee as assignee
secured party; and
o the Trust as debtor and the Indenture Trustee as secured party.
Perfection and the effect of perfection or non-perfection of a security interest
in the Specified Vehicles are governed by the certificate of title statutes of
the states in which such Specified Vehicles are located. Because of the
administrative burden and expense of perfecting an interest in trucks, tractors
and trailers under the certificate of title statutes in the states in which the
Specified Leases were originated, the Indenture Trustee's interest in the
Specified Vehicles will be unperfected, and if the transfer of the Vehicle SUBI
Certificate were to be viewed as a transfer of the Vehicle SUBI Assets, the
Indenture Trustee would only have a perfected security interest in the Specified
Leases. The Indenture Trustee's security interest in the Specified Leases could
be subordinate to the interests of some other parties who take possession of the
Specified Leases. Specifically, the Trust's security interest in a Specified
Lease could be subordinate to the rights of a purchaser of that Specified Lease
who takes possession thereof without knowledge or actual notice of the Trust's
security interest. The Specified Leases will not be stamped to indicate the
precautionary security arrangements. However, the Administration Agreement
requires the Administrative Agent to retain custody of the Specified Leases. To
the extent that a valid lien is imposed by a third party against a Specified
Vehicle, the interest of the lienholder will be superior to the unperfected
beneficial interest of the Trust in that Specified Vehicle. Although the
Administration Agreement will require the Administrative Agent to contest all
such liens and cause the removal of any liens that may be imposed, if any such
liens are imposed against the Specified Vehicles, investors in the Senior Notes
could incur a loss on their investment. For further information relating to
potential liens on the SUBI Assets, see "Additional Document Provisions--The
Administration Agreement--Notification of Liens and Claims", "Additional
Document Provisions--The Administration Agreement--Custody of Lease Documents
and Certificates of Title" and "Certain Legal Aspects of the Origination Trust
and the SUBIs--The SUBIs".
As noted under "Certain Legal Aspects of the Origination Trust and the
SUBIs--The SUBIs", various liens could be imposed upon all or part of the SUBI
Assets that, by operation of law, would take priority over the Trust's interest
therein. Such liens would include mechanic's, repairmen's, garagemen's and motor
vehicle accident liens and some liens for personal property taxes, in each case
arising with respect to a particular Specified Vehicle, liens arising under
various state and federal criminal statutes and some liens more fully described
under "Risk Factors--Liens may be imposed on the trust's assets due to ERISA
liabilities" in favor of the
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Pension Benefit Guaranty Corporation. Additionally, any perfected security
interest of the Trust in all or part of the property of the Trust could also be
subordinate to claims of any trustee in bankruptcy or debtor-in-possession in
the event of a bankruptcy of the Transferor prior to any perfection of the
transfer of the assets sold, transferred and assigned by the Transferor to the
Trust pursuant to the Agreement, as more fully described under "Risk Factors-- A
bankruptcy of the transferor or the administrative agent could delay or limit
payments on the senior notes".
TITLING GRACE PERIOD -- LACK OF PERFECTED OWNERSHIP INTEREST
During the Titling Grace Period, some of the Specified Vehicles will be
titled in the name of Ryder rather than in the name of the Origination Trust or
the Origination Trustee on behalf of the Origination Trust (the "Titling Grace
Period Vehicles"). During the Titling Grace Period, the Administrative Agent
will title the Titling Grace Period Vehicles in the name of the Origination
Trust or the Origination Trustee on behalf of the Origination Trust but no
action will be taken to note the lien of the Transferor on the applicable
certificates of title.
An ownership interest or security interest in a motor vehicle
registered in most states may be perfected against creditors and subsequent
purchasers without notice for valuable consideration only by one or more of the
following: depositing with a state's department of motor vehicles a properly
endorsed certificate of title for the vehicle showing the transferee or secured
party as legal owner or lienholder thereon, filing a sworn notation of lien with
the state's department of motor vehicles and noticing such lien on the
certificate of title, or if the vehicle has not been previously registered,
filing an application in usual form for an original registration together with
an application for registration of the secured party as legal owner or
lienholder, as the case may be, with a state's department of motor vehicles.
Therefore, the Origination Trust and the Transferor may not have a validly
perfected ownership interest and security interest, respectively, in the Titling
Grace Period Vehicles.
As a result, the Origination Trust's and the Transferor's ownership and
security interest, as the case may be, in such a Titling Grace Period Vehicle
will not be perfected and the Transferor's interest in the Titling Grace Period
Vehicles will be inferior to other creditors or purchasers who have taken the
necessary steps described above. However, Ryder will assign its ownership
interest in the Specified Vehicles subject to the Specified Leases and will
transfer such Vehicles to the Origination Trust on or prior to the Closing Date,
and within the Titling Grace Period will retitle all of the Specified Vehicles
in the name of the Origination Trust or the Origination Trustee on behalf of the
Origination Trust. In many states, an assignment of an ownership interest is an
effective conveyance of an interest without amendment of any owner noted on a
vehicle's certificate of title, and the assignee succeeds thereby to the
assignor's rights as owner. However, the Origination Trust's and the
Transferor's interest in these Specified Vehicles could be defeated through
fraud or negligence, and because the Origination Trust is not yet identified as
the owner on the certificate of title, Ryder's bankruptcy.
Failure to retitle a Titling Grace Period Vehicle in the name of the
Origination Trust or the Origination Trustee on behalf of the Origination Trust
by the end of the Titling Grace Period will require the Administrative Agent to
make a payment equal to the Securitization Value of the related Specified Lease
as of the last day of the Titling Grace Period. See "The Origination Trust--
Lease Originations and the Titling of Vehicles" and "The Specified
Leases--Representations, Warranties and Covenants". On or prior to the last day
of the Titling Grace Period the Administrative Agent will provide each Rating
Agency and the Indenture Trustee
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with an Officer's Certificate of the Administrative Agent as to the status of
the retitling of the Titling Grace Period Vehicles. Although all of the
Specified Vehicles have been or will be, during the Titling Grace Period, titled
in the name of the Origination Trust or the Origination Trustee on behalf of the
Origination Trust, no liens will be recorded on the related certificates of
title. See "Certain Legal Aspects of the Specified Leases and Specified
Vehicles--Back-up Security Interests".
VICARIOUS TORT LIABILITY
Although the Origination Trust will own the Specified Vehicles, they
will be operated by the related Obligors and their invitees. State laws differ
as to whether anyone suffering injury to person or property involving a vehicle
may bring an action against the owner of that vehicle merely by virtue of such
ownership.
Following an accident involving a Specified Vehicle, under certain
circumstances the Origination Trust may be the subject of an action for damages
as a result of its ownership of that Specified Vehicle. To the extent that
applicable state law permits such an action, the Origination Trust and the
Origination Trust Assets may be subject to liability. The laws of many states
either do not permit such suits or provide that the lessor's liability is capped
at the amount of any liability insurance that the lessee was required but failed
to maintain. However, in some states, such as New York, liability is joint and
several and there does not appear to be a limit on an owner's liability.
Although the Origination Trust's insurance coverage is substantial, in
the event that all applicable insurance coverage were to be exhausted and
damages were to be assessed against the Origination Trust, claims could be
imposed against the assets of the Origination Trust, including the Specified
Vehicles. However, such claims would not take priority over any SUBI Assets to
the extent that the Trust had a prior perfected security interest therein, such
as would be the case, in certain limited circumstances, with respect to the
Specified Leases, as further described under "--Back-up Security Interests". If
any such claims were imposed against the assets of the Origination Trust,
investors in the Senior Notes could incur a loss on their investment.
REPOSSESSION OF SPECIFIED VEHICLES
In the event that a default by an Obligor has not been cured within a
certain period of time after being sent notice of that default, the
Administrative Agent will ordinarily repossess the related Specified Vehicle.
Some jurisdictions require that a lessee be notified of the default and be given
a time period within which to cure that default prior to repossession.
Generally, this right to cure may be exercised on a limited number of occasions
in any one-year period. In these jurisdictions, if a lessee objects or raises a
defense to repossession, an order must be obtained from the appropriate state
court, and the vehicle must then be repossessed in accordance with that order.
Other jurisdictions permit repossession without notice, but only if the
repossession can be accomplished peacefully. If a breach of the peace cannot be
avoided, judicial action will be required.
After the Administrative Agent has repossessed a Specified Vehicle, it
may provide the related Obligor with a period of time within which to cure the
default under the related Specified Lease. If, by the end of that period, the
default has not been cured, the Administrative Agent will
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attempt to sell that Specified Vehicle. The Termination Proceeds therefrom may
be less than the remaining amounts due under that Specified Lease at the time of
default.
DEFICIENCY JUDGMENTS
The proceeds of sale of a Specified Vehicle generally will be applied
first to the expenses of resale and repossession and then to the satisfaction of
the amounts due under the related Specified Lease. If the proceeds from the sale
do not equal the Securitization Value of the related Specified Vehicle, the
Administrative Agent may seek a deficiency judgment for the amount of the
shortfall. However, some states impose prohibitions or limitations on a secured
party's ability to seek a deficiency judgment. In these states a deficiency
judgment may be prohibited or reduced in amount if the Obligor was not given
proper notice of the resale or if the terms of resale were not commercially
reasonable. Even if a deficiency judgment is obtained, there is no guaranty that
the full amount of the judgment could be collected. Because a deficiency
judgment is a personal judgment against a defaulting Obligor who generally has
few assets to satisfy a judgment, the practical use of a deficiency judgment is
often limited. Therefore, in many cases, it may not be useful to seek a
deficiency judgment and even if obtained, a deficiency judgment may be settled
at a significant discount.
Representations and warranties will be made in the SUBI Trust Agreement
that each Specified Lease complies with all requirements of law in all material
respects. If any such representation and warranty proves to be incorrect with
respect to a Specified Lease, and is not timely cured, the Administrative Agent
will be required under the Administration Agreement to deposit an amount equal
to the Reallocation Payment in respect of that Specified Lease into the SUBI
Collection Account. See "Additional Document Provisions--The SUBI Trust
Agreement--The SUBIs, Other SUBIs and the UTI" and "The Specified
Leases--Representations, Warranties and Covenants" for further information
regarding the foregoing representations and warranties.
OTHER LIMITATIONS
In addition to laws limiting or prohibiting deficiency judgments,
numerous other statutory provisions, including applicable Insolvency Laws, may
interfere with or affect the ability of Ryder to enforce the obligation of the
Administrative Agent to enforce the rights of the Origination Trust under the
Specified Leases. For example, if an Obligor commences bankruptcy proceedings,
the receipt of that Obligor's payments due under the related Specified Lease is
likely to be delayed. In addition, an Obligor who commences bankruptcy
proceedings might be able to assign the related Specified Lease to another party
even though that Specified Lease prohibits assignment.
MATERIAL FEDERAL INCOME TAX CONSEQUENCES
GENERAL
The following is a general discussion of certain material federal
income tax consequences of the purchase, ownership and disposition of the Senior
Notes. Certain portions of the discussion set forth in this section -- those
that specifically refer to Steel Hector & Davis LLP -- are statements of the
opinion of Steel Hector & Davis LLP, special federal income tax counsel to the
Transferor. This discussion is based upon current provisions of the Internal
Revenue Code as of 1986, as amended (the "Code"), existing and proposed Treasury
Department regulations
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thereunder (the "Treasury Regulations"), and current administrative rulings,
judicial decisions and other applicable authorities in effect as of the date
hereof, all of which are subject to change, possibly with retroactive effect.
The discussion does not deal with all federal tax consequences applicable to all
categories of investors, some of which may be subject to special rules. In
addition, this summary is generally limited to investors who purchase Senior
Notes in their initial distribution and who will hold the Senior Notes as
"capital assets" -- generally, property held for investment -- within the
meaning of Section 1221 of the Code.
There are no cases or Internal Revenue Service (the "IRS") rulings with
respect to transactions similar to those described herein with respect to the
Trust involving both debt and equity interests issued by a trust with terms
similar to those of the Senior Notes and the Certificates. As a result, there
can be no assurance that the IRS will not challenge the conclusions reached
herein. Furthermore, legislative, judicial or administrative changes may occur,
perhaps with retroactive effect, which could affect the accuracy of the
statements and conclusions set forth herein as well as the tax consequences to
Senior Noteholders. The parties do not intend to seek a ruling from the IRS on
any of the issues discussed below. Moreover, there can be no assurance that if
such a ruling were sought, the IRS would rule favorably.
Taxpayers and preparers of tax returns (including those filed by any
partnership or other issuer) should be aware that under applicable Treasury
Regulations a provider of advice on specific issues of law is not considered an
income tax return preparer unless the advice is given with respect to events
that have occurred at the time the advice is rendered, is not given with respect
to the consequences of contemplated actions and is directly relevant to the
determination of an entry on a tax return. Accordingly, taxpayers should consult
their respective tax advisors and tax return preparers regarding the preparation
of any item on a tax return, even where the anticipated tax treatment has been
discussed herein. It is recommended that prospective investors consult their own
tax advisors with regard to the federal income tax consequences of the purchase,
ownership and disposition of the Senior Notes, as well as the tax consequences
arising under the laws of any state, foreign country or other taxing
jurisdiction.
This summary does not purport to deal with all aspects of federal
income taxation that may be relevant to Senior Noteholders in light of their
personal investment circumstances nor, except for some limited discussions of
particular topics, to some types of Senior Noteholders subject to special
treatment under the federal income tax laws, such as financial institutions,
broker-dealers, life insurance companies and tax-exempt organizations.
SENIOR NOTES
GENERAL
TAX CHARACTERIZATION OF THE TRUST. In the opinion of Steel Hector &
Davis LLP, special counsel to the Transferor, subject to the assumptions and
qualifications contained in that opinion, under existing law the Trust will not
be classified as an association, or publicly traded partnership, taxable as a
corporation for federal income tax purposes. This opinion will be based on the
assumption that, among other things, the Senior Notes, the Subordinated Notes
and the Certificates will be issued pursuant to the terms of the Basic
Documents, that such terms will be complied with and on counsel's conclusions
that the nature of the income of the Trust or the satisfaction of certain safe
harbors relating to the trading of the Certificates will exempt the Trust from
the rule that some publicly traded partnerships are taxable as corporations.
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CHARACTERIZATION OF THE SENIOR NOTES AS INDEBTEDNESS. The Transferor
and the Owner Trustee will agree, and the Senior Noteholders will agree by their
purchase of Senior Notes, to treat the Senior Notes for federal, state and local
income and franchise tax purposes as indebtedness, secured by the assets of the
Trust. However, the SUBI Certificate Transfer Agreement generally refers to the
transfer of the Vehicle SUBI Certificate as an "absolute sale, transfer and
assignment," and the Transferor will treat the SUBI Certificate Transfer
Agreement, for some non-tax accounting purposes, as causing a transfer of an
ownership interest in the Vehicle SUBI Certificate and not as creating a debt
obligation.
For U.S. federal income tax purposes, the economic substance of a
transaction often determines its tax consequences. The form of a transaction,
while a relevant factor, is generally not conclusive evidence of the economic
substance of the transaction. In appropriate circumstances, the courts have
allowed the IRS, as well as taxpayers, in more limited circumstances, to treat a
transaction in accordance with its economic substance, as determined under U.S.
federal income tax law, even though the participants have characterized the
transaction differently for non-tax purposes. In COMMISSIONER v. DANIELSON, 378
F.2d 771 (3d Cir. 1967) ("DANIELSON"), the Third Circuit Court of Appeals
substantially limited the circumstances in which a taxpayer for tax purposes
could ignore the form of a transaction. Some courts have followed this decision
while others have not. DANIELSON related to the treatment of a bargained-for
allocation of purchase price, which various taxpayers were characterizing in
different ways, and the application of the DANIELSON rationale to the Senior
Notes, where all of the parties have agreed on a consistent tax characterization
of the transaction, is arguably not appropriate. However, in UNITED STATES v.
SCHARRER, 229 B.R. 210 (M.D. Fla. 1999), the District Court, citing DANIELSON,
reversed a bankruptcy court's decision that a purported sale of lease payments
was a borrowing, on the grounds that the form of the transaction was a sale
rather than a borrowing. While the facts of the case differ from those involving
the Senior Notes, the case extends DANIELSON to sale/borrowing transactions.
Nevertheless, it is the opinion of Steel Hector & Davis LLP, special counsel to
the Transferor, that in a properly presented case, the DANIELSON doctrine would
not prevent a determination of the tax characterization of the Senior Notes
based on the economic substance of the transaction.
In the opinion of Steel Hector & Davis LLP, special tax counsel to the
Transferor, subject to the assumptions and qualifications contained in that
opinion, under existing law the Senior Notes will be treated as indebtedness for
federal income tax purposes. The discussion below assumes this characterization
of the Senior Notes is correct.
STATED INTEREST. Stated interest on the Senior Notes will be taxable as
ordinary income for federal income tax purposes when received or accrued in
accordance with a Senior Note Owner's method of tax accounting.
ORIGINAL ISSUE DISCOUNT. A Senior Note will be treated as issued with
Original Issue Discount ("OID") if the excess of its stated redemption price at
maturity over its issue price equals or exceeds a DE MINIMIS amount equal to 1/4
of 1 percent of stated redemption price at maturity multiplied by the number of
complete years based on the anticipated weighted average life of the Senior Note
to its maturity. It is expected that the Senior Notes will be issued with DE
MINIMIS OID. Generally, the issue price of a Senior Note should be the first
price at which a substantial amount of the Senior Notes included in the issue of
which the Senior Note is a part is sold to other than bond houses, brokers or
similar persons or organizations acting in the capacity of underwriters,
placement agents or wholesalers. The stated redemption price at maturity of a
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Senior Note is expected to equal the principal amount of the related Senior
Note. Any amount not treated as OID because it is DE MINIMIS OID must be
included in income -- generally as gain from the sale of that Senior Note -- as
principal payments are received on the related Senior Notes in the proportion
that each such payment bears to the original principal balance of that Senior
Note.
If the Senior Notes are issued with OID, Senior Noteholders generally
will be required to include OID in income for each accrual period in advance of
receipt of the cash representing that OID. A holder of a debt instrument issued
with OID is required to recognize as ordinary income the amount of OID on the
debt instrument as such discount accrues, in accordance with a constant yield
method. Because the payments on the Senior Notes may be accelerated by reason of
prepayments on or the sale of some of the SUBI Assets, the periodic accrual of
OID, other than DE MINIMIS OID, may have to be determined under section
1272(a)(6) of the Code by taking into account both the prepayment assumption
used in pricing the Senior Notes and the prepayment experience. The amount of
OID that will accrue on a Senior Note during an accrual period -- generally the
period between interest payments or compounding dates -- is the excess, if any,
of the sum of
o the present value of all payments remaining to be made on the Senior
Note as of the close of the accrual period, and
o the payments during the accrual period of amounts included in the
stated redemption price of the Senior Note,
over the adjusted issue price of the Senior Note at the beginning of the accrual
period. An accrual period is the period over which OID accrues, and may be of
any length, provided that each accrual period is no longer than one year and
each scheduled payment of interest or principal occurs on either the last day or
the first day of an accrual period. The Trust intends to report OID on the basis
of an accrual period that corresponds to the interval between Payment Dates. The
adjusted issue price of a Senior Note is the sum of its issue price plus prior
accruals of OID, reduced by the total payments made with respect to that Senior
Note in all prior periods, other than qualified stated interest payments. The
present value of the remaining payments is determined on the basis of three
factors:
o the original yield to maturity of the Senior Note, determined on the
basis of compounding at the end of each accrual period and properly
adjusted for the length of the accrual period,
o events which have occurred before the end of the accrual period, and
o the assumption that the remaining payments will be made in
accordance with the original prepayment assumption.
No regulations have been issued under section 1272(a)(6) so it is not clear if
that section of the Code would apply to the Senior Notes if they are treated as
having OID.
The effect of this method is to increase the portions of OID required
to be included in income by a Senior Noteholder to take into account prepayments
on the Specified Leases at a rate that exceeds the original prepayment
assumption, and to decrease -- but not below zero for any period -- the portions
of OID required to be included in income by a Senior Noteholder to take into
account prepayments on or the sale of some of the SUBI Assets at a rate that is
slower than the original prepayment assumption. Although OID will be reported to
Senior Noteholders based on the original prepayment assumption, no
representation is made to Senior Noteholders that Specified Leases will be
prepaid at that rate or at any other rate.
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The holder of a Senior Note that has a fixed maturity date of not more
than one year from the issue date of that Senior Note (a "Short-Term Note") may
be subject to special rules. An accrual basis holder of a Short-Term Note, and
some cash method holders, including regulated investment companies, as set forth
in Section 1281 of the Code, generally would be required to report interest
income as interest accrues on a straight-line basis over the term of each
interest period. Other cash basis holders of a Short-Term Note would, in
general, be required to report interest income as interest is paid, or, if
earlier, upon the taxable disposition of the Short-Term Note. However, a cash
basis holder of a Short-Term Note reporting interest income as it is paid may be
required to defer a portion of any interest expense otherwise deductible on
indebtedness incurred to purchase or carry the Short-Term Note until the taxable
disposition of the Short-Term Note. A cash basis taxpayer may elect under
Section 1281 of the Code to accrue interest income on all nongovernment debt
obligations with a term of one year or less, in which case the taxpayer would
include interest on the Short-Term Note in income as it accrues, but would not
be subject to the interest expense deferral rule referred to in the preceding
sentence. Some special rules apply if a Short-Term Note is purchased for more or
less than its principal amount.
MARKET DISCOUNT. The Senior Notes, whether or not issued with OID, will
be subject to the "market discount rules" of Section 1276 of the Code. In
general, these rules provide that if the Senior Note Owner purchases a Senior
Note, as the case may be, at a market discount - that is, a discount from its
stated redemption price at maturity, which is generally the stated principal
balance - or if the related Senior Notes were issued with OID, its original
issue price, as adjusted for accrued original issue discount that exceeds a DE
MINIMIS amount specified in the Code, and thereafter (a) recognizes gain upon a
disposition, or (b) receives payments of principal, the lesser of (1) that gain
or principal payment or (2) the accrued market discount, will be taxed as
ordinary interest income. Generally, the accrued market discount will be the
total market discount on the related Senior Note multiplied by a fraction, the
numerator of which is the number of days the Senior Note Owner held that Senior
Note and the denominator of which is the number of days from the date the Senior
Note Owner acquired that Senior Note until its maturity date. The Senior Note
Owner of a Senior Note may elect, however, to determine accrued market discount
under the constant-yield method.
Limitations imposed by the Code which are intended to match deductions
with the taxation of income may defer deductions for interest on indebtedness
incurred or continued, or short-sale expenses incurred, to purchase or carry a
Senior Note with accrued market discount. A Senior Note Owner may elect to
include market discount in gross income as it accrues and, if that Senior Note
Owner makes such an election, is exempt from this rule. Any such election will
apply to all debt instruments acquired by the taxpayer on or after the first day
of the first taxable year to which that election applies. The adjusted basis of
a Senior Note subject to that election will be increased to reflect market
discount included in gross income, thereby reducing any gain or increasing any
loss on a sale or taxable disposition.
TOTAL ACCRUAL ELECTION. A Senior Note Owner may elect to include in
gross income all interest that accrues on a Senior Note using the constant-yield
method described above under the heading "--Original Issue Discount", with
modifications described below. For purposes of this election, interest includes
stated interest, acquisition discount, OID, DE MINIMIS OID, market discount, DE
MINIMIS market discount and unstated interest, as adjusted by any amortizable
bond premium (described below under "--Amortizable Bond Premium") or acquisition
premium.
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In applying the constant-yield method to a Senior Note with respect to
which this election has been made, the issue price of the Senior Note will equal
the electing Senior Note Owner's adjusted basis in the Senior Note immediately
after its acquisition, the issue date of the Senior Note will be the date of its
acquisition by the electing Senior Note Owner, and no payments on the Senior
Note will be treated as payments of qualified stated interest. This election
will generally apply only to the Senior Note with respect to which it is made
and may not be revoked without the consent of the IRS. Senior Note Owners should
consult with their own advisers as to the effect in their circumstances of
making this election.
AMORTIZABLE BOND PREMIUM. In general, if a Senior Note Owner purchases
a Senior Note at a premium -- that is, an amount in excess of the amount payable
upon maturity -- that Senior Note Owner will be considered to have purchased
that Senior Note with "amortizable bond premium" equal to the amount of such
excess. That Senior Note Owner may elect to amortize that bond premium as an
offset to interest income and not as a separate deduction item as it accrues
under a constant-yield method over the remaining term of the Senior Note. That
Senior Note Owner's tax basis in the Senior Note will be reduced by the amount
of the amortized bond premium. Any such election shall apply to all debt
instruments, other than instruments the interest on which is excludible from
gross income, held by the Senior Note Owner at the beginning of the first
taxable year for which the election applies or thereafter acquired and is
irrevocable without the consent of the IRS. Bond premium on a Senior Note held
by a Senior Note Owner who does not elect to amortize the premium will decrease
the gain or increase the loss otherwise recognized on the disposition of the
Senior Note. The Treasury Regulations specifically exclude debt instruments that
are subject to Section 1272(a)(6) of the Code from the amortizable bond premium
rules contained in those regulations (see the discussion of Section 1272(a)(6)
in "-- Original Issue Discount" above).
DISPOSITION OF SENIOR NOTES. A Senior Note Owner's adjusted tax basis
in a Senior Note will be its cost, increased by the amount of any OID, market
discount, acquisition discount and gain previously included in income with
respect to the Senior Note, and reduced by the amount of any payments on the
Senior Note that is not qualified stated interest and the amount of bond premium
previously amortized with respect to the Senior Note. A Senior Note Owner will
generally recognize gain or loss on the sale or retirement of a Senior Note
equal to the difference between the amount realized on the sale or retirement
and the tax basis of the Senior Note. Such gain or loss will be capital gain or
loss, except to the extent attributable to accrued but unpaid interest or as
described above under "--Market Discount", and will be long-term capital gain or
loss if their Senior Note was held for more than one year.
Subject to the OID and market discount rules discussed above and to the
one-year holding period requirement for long-term capital gain treatment, any
such gain or loss generally will be long-term capital gain or loss, provided the
Senior Note was held as a capital asset. The maximum federal income tax rate
applicable to capital gains and ordinary income for corporations is 35%. The
maximum ordinary federal income tax rate for individuals, estates and trusts is
39.6%, whereas the maximum long-term capital gains rate for such taxpayers is
20%. Under the Taxpayer Relief Act of 1997, the maximum rates on long-term
capital gains will be reduced further in the year 2001 and thereafter for some
individual taxpayers that meet specified conditions. Each prospective investor
should consult its tax advisor concerning these tax law changes.
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INFORMATION REPORTING AND BACKUP WITHHOLDING
The Indenture Trustee will be required to report annually to the IRS,
and to each Senior Noteholder, the amount of interest paid on the Senior Notes,
and the amount withheld for federal income taxes, if any, for each calendar
year, except as to exempt recipients -- generally, corporations, tax-exempt
organizations, qualified pension and profit-sharing trusts, individual
retirement accounts, or nonresident aliens who provide certification as to their
status. Each Senior Noteholder, other than Senior Noteholders who are not
subject to the reporting requirements, will be required to provide, under
penalty of perjury, a certificate containing the Senior Noteholder's name,
address, correct federal taxpayer identification number -- which would include a
social security number -- and a statement that the Senior Noteholder is not
subject to backup withholding. Should a non-exempt Senior Noteholder fail to
provide the required certification or should the IRS notify the Indenture
Trustee or the Trust that the Senior Noteholder has provided an incorrect
federal taxpayer identification number or is otherwise subject to backup
withholding, the Indenture Trustee will be required to withhold, or cause to be
withheld, 31% of the interest otherwise payable to the Senior Noteholder, and
remit the withheld amounts to the IRS as a credit against the Senior
Noteholder's federal income tax liability.
TAX CONSEQUENCES TO FOREIGN INVESTORS
The following information describes the United States federal income
tax treatment of investors that are not U.S. persons (each, a "Foreign Person").
The term "Foreign Person" means any person other than (a) a citizen or resident
of the United States that is a natural person, (b) a corporation or partnership
for federal income tax purposes organized in or under the laws of the United
States or any state thereof or the District of Columbia, other than a
partnership that is not treated as a "United States person" within the meaning
of that term as it is used in the Code or the Treasury Regulations, (c) an
estate whose income is subject to United States federal income tax regardless of
its source of income, or (d) a trust treated as a United States person.
o Interest paid or accrued to a Foreign Person that is not effectively
connected with the conduct of a trade or business within the United
States by the Foreign Person, will generally be considered
"portfolio interest" and generally will not be subject to United
States federal income tax and withholding tax, as long as the
Foreign Person (1) is not actually or constructively a "10% percent
shareholder" of the Trust or Ryder, or a "controlled foreign
corporation" with respect to which the Trust or Ryder is a "related
person" within the meaning of the Code, and (2) provides an
appropriate statement (Form W-8), signed under penalty of perjury,
certifying that the Senior Note Owner is a Foreign Person and
providing that Foreign Person's name and address. If the information
provided in this statement changes, the Foreign Person must so
inform the Indenture Trustee within 30 days of that change. The
statement generally must be provided in the year a payment occurs or
in either of the two preceding years. If the interest were not
portfolio interest, then it would be subject to United States
federal income and withholding tax at a rate of 30 percent unless
reduced or eliminated pursuant to an applicable income tax treaty.
o Any capital gain realized on the sale or other taxable disposition
of a Senior Note by a Foreign Person will be exempt from United
States federal income and withholding tax, provided that (1) the
gain is not effectively connected with the conduct of a trade or
business in the United States by the Foreign Person, and (2) in the
case of an individual Foreign Person, the Foreign Person is not
present in the United States for 183 days or more in the taxable
year and some other requirements are met.
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o If the interest, gain or income on a Senior Note held by a Foreign
Person is effectively connected with the conduct of a trade or
business in the United States by the Foreign Person, the Senior Note
Owner (although exempt from the withholding tax previously discussed
if a duly executed Form 4224 is furnished) generally will be subject
to United States federal income tax on the interest, gain or income
at regular federal income tax rates. In addition, if the Foreign
Person is a foreign corporation, it may be subject to a branch
profits tax equal to 30 percent of its "effectively connected
earnings and profits" within the meaning of the Code for the taxable
year, as adjusted for certain items, unless it qualifies for a lower
rate under an applicable tax treaty.
NEW WITHHOLDING REGULATIONS. On October 6, 1997, the Treasury
Department issued regulations (the "Withholding Regulations") which make some
modifications to the withholding, backup withholding and information reporting
rules described above. The Withholding Regulations attempt to unify
certification requirements and modify reliance standards. The Withholding
Regulations will generally be effective for payments made after December 31,
2000, subject to some transition rules. Prospective investors are urged to
consult their own tax advisors regarding the Withholding Regulations.
POSSIBLE ALTERNATIVE TREATMENT OF THE NOTES. Although, as described
above, it is the opinion of Steel Hector & Davis LLP that the Senior Notes will
properly be characterized as debt for federal income tax purposes, such opinion
will not be binding on the IRS and thus no assurance can be given that such a
characterization shall prevail. If the IRS were to contend successfully that the
Senior Notes did not represent debt for federal income tax purposes, certain
adverse tax consequences to the trust and the holders of Senior Notes could
result. For example, the trust would likely be considered a "publicly-traded
partnership", and as a result treated for U.S. tax purposes as an association
taxed as a corporation. In addition, income to certain tax-exempt entities
(including pension funds) generally would be "unrelated business taxable
income", and income to foreign U.S. holder of Senior Notes generally would be
subject to U.S. withholding tax and reporting requirements. While the Transferor
strongly believes that any challenge by the IRS, if made, would be unsuccessful,
there can be no assurance of this result. Prospective investors are advised to
consult with their own tax advisors regarding the federal income tax
consequences of the purchase, ownership and disposition of the Senior Notes.
CERTAIN STATE TAX CONSEQUENCES
GENERAL
Set forth below is a summary of some state income tax consequences of
the purchase, ownership and disposition of the Senior Notes. This discussion is
based upon current law, administrative rulings, judicial decisions and other
applicable authorities in effect as of the date hereof, all of which are subject
to change, possibly with retroactive effect. There can be no assurance that
state income tax authorities will not challenge the conclusions reached herein,
and no ruling from state income tax authorities has been or will be sought on
any of the issues discussed below. Because of the variation in each state's
income tax laws, it is impossible to predict tax consequences to the holders of
the Senior Notes in all states. Holders of the Senior Notes are urged to consult
their own tax advisors with respect to state tax consequences arising out of the
purchase, ownership and disposition of the Senior Notes.
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DELAWARE
The Transferor has been organized as a Delaware business trust. In the
opinion of Richards, Layton & Finger P.A., special Delaware counsel to the
Trust, assuming that the Senior Notes are treated as debt for federal income tax
purposes, the Senior Notes will be treated as debt for Delaware state income tax
purposes. Assuming further that none of the Origination Trust, the Transferor or
the Trust will be classified as an association, or a publicly traded
partnership, taxable as a corporation for federal income tax purposes, none of
the Origination Trust, the Transferor or the Trust will be subject to the
Delaware state income tax at the entity level. Further, in the opinion of
Richards, Layton & Finger P.A., Senior Note Owners not otherwise subject to
taxation in Delaware would not become subject to taxation in Delaware solely
because of a Senior Note Owner's ownership of a Senior Note.
FLORIDA
The Florida Administrative Code includes a rule (the "Loan Rule"),
promulgated under the Florida Income Tax Code, which provides that a financial
organization earning or receiving interest from loans secured by tangible
property located in Florida will be deemed to be conducting business or earning
or receiving income in Florida, and will be subject to Florida corporate income
tax irrespective of the place of receipt of that interest. A "financial
organization" is defined to include any bank, trust company, savings bank,
industrial bank, land bank, safe deposit company, private bank, savings and loan
association, credit union, cooperative bank, small loan company, sales finance
company or investment company. If the Loan Rule were to apply to an investment
in the Senior Notes, then a financial organization investing in the Senior Notes
would be subject to Florida corporate income tax on a portion of its income at a
maximum rate of 5.5%, and would be required to file an income tax return in
Florida, even if it has no other Florida contacts. Steel Hector & Davis LLP,
special counsel to the Transferor, is of the opinion that, if the matter were
properly presented to a court having jurisdiction, and assuming interpretation
of relevant law on a basis consistent with existing authority, that court would
hold that the Loan Rule would not apply to an investment in the Senior Notes or
the receipt of interest thereon by a financial organization with no other
Florida contacts. Consequently, prospective investors are urged to consult their
own tax advisers as to the applicability of Florida taxation to their
investments in the Senior Notes and to their ability to offset any such Florida
tax against any other state tax liabilities that such investors might have.
MISCELLANEOUS
In the event that any state or locality imposes a tax on the
Origination Trust, the Transferor or the Trust at the entity level, the UTI
Beneficiaries have agreed to indemnify the holders of the SUBIs for the full
amount of such taxes. If the UTI Beneficiaries should fail to fulfill their
respective indemnification obligations, amounts otherwise distributable to them
as holders of the UTI will be used to satisfy such indemnification obligations.
However, it is possible that the Senior Noteholders could incur a loss on their
investment in the event the UTI Beneficiaries did not have sufficient assets
available, including distributions on the UTI, to satisfy such state or local
tax liabilities.
THE FEDERAL AND STATE TAX DISCUSSIONS SET FORTH ABOVE DO NOT PURPORT TO ADDRESS
THE APPLICABILITY OF STATE TAX LAWS OTHER THAN THE TREATMENT OF THE TRUST AND
THE SENIOR NOTE OWNERS UNDER THE LAWS OF FLORIDA AND DELAWARE AND MAY NOT BE
APPLICABLE DEPENDING UPON
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A SENIOR NOTE OWNER'S PARTICULAR TAX SITUATION. PROSPECTIVE PURCHASERS SHOULD
CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE
PURCHASE, OWNERSHIP AND DISPOSITION OF THE SENIOR NOTES, INCLUDING THE TAX
CONSEQUENCES UNDER FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE
POSSIBLE EFFECTS OF CHANGES IN FEDERAL OR OTHER TAX LAWS.
ERISA CONSIDERATIONS
GENERAL
The Employee Retirement Income Security Act of 1974, as amended
("ERISA"), imposes some restrictions on employee benefit or other plans subject
to ERISA or Section 4975 of the Code ("Plans") and on persons who are parties in
interest or disqualified persons (collectively, "Parties in Interest") with
respect to such Plans that would affect purchases of the Senior Notes by or on
behalf of Plans. Some employee benefit plans, such as governmental plans and
church plans, if no election has been made under Section 410(d) of the Code, are
not subject to the requirements of ERISA or Section 4975 of the Code and assets
of such plans may be invested in Senior Notes without regard to the ERISA
considerations described below, subject to the provisions of other applicable
federal and state law, including, for any such government or church plan
qualified under Section 401(a) of the Code and exempt from taxation under
Section 501(a) of the Code, the prohibited transaction rules set forth in
Section 503 of the Code.
Investments by most Plans are subject to ERISA's general fiduciary
requirements, including the requirement of investment prudence and
diversification, requirements respecting delegation of investment authority and
the requirement that a Plan's investment be made in accordance with the
documents governing the Plan.
PROHIBITED TRANSACTIONS
Some transactions involving the Trust might be deemed to constitute or
give rise to prohibited transactions under ERISA and Section 4975 of the Code if
assets of the Trust were deemed to be assets of a Plan. Under a regulation
issued by the United States Department of Labor (the "Plan Assets Regulation"),
the assets of the Trust would be treated as plan assets of a Plan for purposes
of ERISA and the Code only if the Plan acquires an "equity interest" in the
Trust and none of the exceptions contained in the Plan Assets Regulation is
applicable. An equity interest is defined under the Plan Assets Regulation as an
interest other than an instrument which is treated as indebtedness under
applicable local law and which has no substantial equity features. Although
there is no guidance under ERISA on how this definition applies generally, or in
particular to a security like the Senior Notes, the Transferor believes that the
Senior Notes should be treated as indebtedness without substantial equity
features for purposes of the Plan Assets Regulation. However, without regard to
whether the Senior Notes are treated as an equity interest for such purposes,
the acquisition or holding of Senior Notes by or on behalf of a Plan could be
considered to give rise to a prohibited transaction if the Trust, a Trustee, any
Certificateholder, or any of their affiliates, is or becomes a Party in Interest
with respect to that Plan. In that case, some exemptions from the prohibited
transaction rules could be applicable, depending on the type and circumstances
of the Plan fiduciary making the decision to acquire a Senior Note. Included
among these exemptions are: Prohibited Transaction Class Exemption ("PTCE")
90-1, which exempts some transactions involving insurance company pooled
separate accounts, PTCE 95-60, which exempts some transactions involving
insurance company general accounts, PTCE 91-38, which exempts some transactions
involving bank collective investment
126
<PAGE> 128
funds, PTCE 96-23, which exempts some transactions effected on behalf of a Plan
by an "in-house asset manager", and PTCE 84-14, which exempts some transactions
effected on behalf of a Plan by a "qualified professional asset manager".
A Plan fiduciary considering the purchase of Senior Notes should
consult its tax and/or legal advisors regarding whether the assets of the Trust
would be considered plan assets, the possibility of exemptive relief from the
prohibited transaction rules and other issues and their potential consequences.
Acceptance of subscriptions for Senior Notes on behalf of plans is in no respect
a representation by the Transferor, the Trust, Ryder or any other party that
this investment meets all relevant legal requirements with respect to
investments by any particular plan or that such investment is appropriate for
any particular plan. Each plan fiduciary should consult with its attorneys and
financial advisors as to the propriety of that an investment in light of the
circumstances of the particular plan and the restrictions of ERISA and Section
4975 of the Code.
Each purchaser or transferee of a Senior Note, by its acceptance of
that Senior Note, will be deemed to have represented that (A) such transferee is
not, and will not acquire the Senior Note on behalf or with the assets of, any
"employee benefit plan" as defined in Section 3(3) of ERISA or any other "plan"
as defined in Section 4975(e)(1) of the Code, or (B) no "prohibited transaction"
under ERISA or Section 4975 of the Code that is not subject to a statutory,
regulatory or administrative exemption will occur in connection with that
transferee's acquisition of the Senior Note.
RATINGS OF THE SECURITIES
The Senior Notes will be issued only if the Class A-1 Notes are rated
in the highest short-term rating category and the other senior notes are rated
in the highest long-term category by each Rating Agency. The ratings of the
Senior Notes and the Certificates will be based primarily upon the value of the
Specified Leases, the Reserve Fund, the Residual Value Surplus Account and the
terms of the Subordinated Notes and the Certificates. There can be no assurance
that any such rating will not be lowered or withdrawn by the assigning Rating
Agency if, in its judgment, circumstances so warrant. In the event that a rating
with respect to the Senior Notes or the Certificates is qualified, reduced or
withdrawn, no person or entity will be obligated to provide any additional
credit enhancement with respect to the Senior Notes or the Certificates.
The rating of the Senior Notes should be evaluated independently from
similar ratings on other types of securities. A rating is not a recommendation
to buy, sell or hold the Senior Notes, inasmuch as such rating does not comment
as to market price or suitability for a particular investor. The rating of the
Senior Notes address the likelihood of the payment of principal of and interest
on the Senior Notes pursuant to their terms.
There can be no assurance as to whether any agency other than the
assigning Rating Agency will rate the Senior Notes or, if one does, what rating
will be assigned by such other rating agency. A rating on the Senior Notes or
the Certificates by another rating agency, if assigned at all, may be lower than
the ratings assigned to the Senior Notes by the assigning Rating Agency.
127
<PAGE> 129
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting
Agreement relating to the Senior Notes (the "Underwriting Agreement"), the
Transferor has agreed to sell to the underwriters named below (the
"Underwriters"), for whom Merrill Lynch, Pierce, Fenner & Smith Incorporated is
acting as representative (the "Representative"), and the Underwriters have
agreed to purchase, severally but not jointly, the following principal amounts
of the Senior Notes.
<TABLE>
<CAPTION>
CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-4
UNDERWRITER SENIOR NOTES SENIOR NOTES SENIOR NOTES SENIOR NOTES
----------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated......................
Total.....................................
</TABLE>
The Underwriting Agreement provides, subject to conditions precedent,
that the Underwriters will be obligated to purchase all the Senior Notes if any
are purchased. The Underwriting Agreement provides that if there is an event of
default by an Underwriter, in some circumstances the purchase commitments of the
non-defaulting Underwriters may be increased or the Underwriting Agreement may
be terminated. The Underwriters have agreed to reimburse the Transferor for some
of its expenses incurred in connection with the offering of the Senior Notes.
The Transferor has been advised by the Representatives that the
Underwriters propose initially to offer the Senior Notes to the public at the
respective offering prices set forth on the cover hereof and to certain dealers
at such prices less a selling concession not to exceed the percentage of the
principal amount of the Senior Notes set forth below, and that the Underwriters
may allow and such dealers may reallow a reallowance discount not to exceed the
percentage of the principal amount of the Senior Notes set forth below.
<TABLE>
<CAPTION>
CLASS OF SENIOR NOTES SELLING CONCESSION REALLOWANCE DISCOUNT
- --------------------- ------------------ --------------------
<S> <C> <C>
Class A-1.....................................
Class A-2.....................................
Class A-3.....................................
Class A-4.....................................
</TABLE>
The Transferor and Ryder have jointly and severally agreed to indemnify
the Underwriters against certain liabilities, including civil liabilities under
the Securities Act of 1933, or contribute to payments which the Underwriters may
be required to make in respect thereof.
Upon receipt of a request by an investor who has received an electronic
Prospectus from the Transferor, its affiliates or an Underwriter, or of a
request by such investor's representative, within the period during which there
is an obligation to deliver a Prospectus, the Transferor or the Underwriters
will promptly deliver, or cause to be delivered, without charge, a paper copy of
the Prospectus.
Until the distribution of the Senior Notes is completed, the rules of
the SEC may limit the ability of the Underwriters and certain selling group
members to bid for and purchase Senior
128
<PAGE> 130
Notes. As an exception to these rules, the Underwriters are permitted to engage
in certain transactions that stabilize the price of the Senior Notes. Such
transactions may consist of bids and purchases for the purpose of pegging,
fixing or maintaining the price of such classes of Senior Notes.
Neither the Transferor nor the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the prices of the Senior Notes. In addition, neither
the Transferor nor the Underwriters makes any representation that the
Underwriters will engage in such transactions or that such transactions, once
commenced, will not be discontinued without notice.
The Transferor has been advised by the Underwriters that they presently
intend to make a market in the Senior Notes; however, they are not obligated to
do so, any market-making may be discontinued at any time, and there can be no
assurance that an active public market for the Senior Notes will develop.
LEGAL MATTERS
Certain legal matters, including federal income tax matters relating to
the Senior Notes, will be passed upon for the Transferor by Steel Hector & Davis
LLP, Miami, Florida. Richards, Layton & Finger P.A., Wilmington, Delaware, will
act as special Delaware counsel to the Transferor. Certain legal matters with
respect to insolvency issues relating to the Senior Notes will be passed upon
for the Transferor by Brown & Wood LLP, San Francisco, California. Brown & Wood
LLP will act as counsel for the Underwriters. Brown & Wood LLP has rendered
services to the Transferor and its affiliates in connection with the
establishment of the Origination Trust and in some matters not related to the
Senior Notes offered by this prospectus.
EXPERTS
The balance sheets of Ryder Truck Rental LT as of December 31, 1998 and
1997 and the related statements of operations, changes in undivided trust
interests and cash flows for the year ended December 31, 1998 and period from
July 23, 1997 (date of inception) through December 31, 1997 have been included
herein and in the registration statement in reliance upon the report of KPMG
LLP, independent certified public accountants, appearing elsewhere herein, and
upon the authority of said firm as experts in accounting and auditing.
The balance sheet of Ryder Vehicle Lease Trust 1999-A as of September
9, 1999 has been included herein and in the registration statement in reliance
upon the report of KPMG LLP, independent certified public accountants, appearing
elsewhere herein, and upon the authority of said firm as experts in accounting
and auditing.
AVAILABLE INFORMATION
The Transferor, as originator of the Trust, Ryder Funding LP, as
originator of the Origination Trust, the Origination Trust, as issuer of the
SUBIs, and the Trust, as issuer of the Notes, have filed with the SEC a
Registration Statement on Form S-1 (together with all amendment and exhibits
thereto, the "Registration Statement"), of which this Prospectus is a part,
under the Securities Act of 1933, with respect to the Senior Notes being offered
by this
129
<PAGE> 131
prospectus. This prospectus does not contain all of the information set forth in
the Registration Statement, some parts of which have been omitted in accordance
with the rules and regulations of the SEC. For further information, reference is
made to the Registration Statement, which is available for inspection without
charge at the public reference facilities of the SEC at Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549, and the regional offices of the SEC
at Suite 1400, Citicorp Center, 500 West Madison Street, Chicago, Illinois
60661-2511 and Suite 1300, Seven World Trade Center, New York, New York 10048.
Copies of such information can be obtained from the Public Reference Section of
the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates.
The SEC maintains a Web site that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the SEC at http://www.sec.gov. The Administrative Agent, on behalf of the
Trust, will also file or cause to be filed with the SEC such periodic reports as
are required under the Securities Exchange Act of 1934, and the rules and
regulations of the SEC thereunder.
130
<PAGE> 132
INDEX OF PRINCIPAL TERMS
Set forth below is a list of some of the more important capitalized terms used
in this Offering Circular and the pages on which the definitions of those terms
may be found.
<TABLE>
<CAPTION>
Term Page Term Page
- ---- ---- ---- ----
<S> <C> <C> <C>
Accrual Period.....................................46
Administration Agreement...........................19
Administration Fee.................................73
Administrative Agent...............................19
Administrative Agent Defaults......................73
Administrator......................................17
Advance............................................70
Aggregate Cutoff Date Securitization Value.........35
Annual Termination Option..........................27
Available Funds....................................51
Available Funds Shortfall Amount...................51
Available Principal Distribution Amount............46
Bankruptcy Code....................................79
Basic Documents....................................45
Business Day.......................................45
Casualty Proceeds..................................70
Casualty Termination Lease.........................47
Cede...............................................45
Cedelbank..........................................47
Cedelbank Participants.............................48
Certificate Balance................................46
Certificate Distribution Account...................58
Certificate Rate...................................56
Certificates.......................................16
Closing Date.......................................16
Code...............................................86
Collection Period..................................51
Collections........................................67
Conditional Prepayment Rate........................41
Contingent and Excess Liability Insurance..........59
CPR................................................41
Cutoff Date........................................21
Cutoff Date Securitization Value...................30
Default Termination Lease..........................47
Defaulted Vehicle..................................68
Definitive Notes...................................45
Deposit Date.......................................58
Depositaries.......................................48
Determination Date.................................51
Disposition Expenses...............................68
Distribution Accounts..............................58
DTC................................................45
ERISA..............................................92
Euroclear..........................................47
Euroclear Participants.............................48
Excess Amounts.....................................52
Exchange Act.......................................33
Expired Vehicle....................................68
Final Payment Date.................................41
Financial Component................................29
Financial Component Advances.......................71
Fixed Charge.......................................29
Foreign Person.....................................90
Full Financial Component Advance...................71
Indenture Default..................................59
Indenture Trustee..................................17
Indirect Participants..............................48
Initial Certificate Balance........................16
Initial Deposit....................................57
Initial Securities Balance.........................53
Initial Senior Note Balance........................16
Initial Subordinated Note Balance..................16
Insolvency Laws....................................79
Insurance Casualty Proceeds........................70
Insurance Proceeds.................................70
Insured Vehicles...................................25
Interest Rate......................................46
IRS................................................86
Lease..............................................24
Lease Default......................................34
Lease SUBI.........................................16
Lease SUBI Assets..................................21
Lease SUBI Certificate.............................16
Lease Term.........................................24
Leases.............................................19
Loan Rule..........................................91
Loss...............................................66
Maintenance Provider...............................19
Maturity Date......................................24
Monthly Period.....................................73
Monthly Remittance Condition.......................68
Net Book Value.....................................30
Non-Petition Parties...............................78
Note Distribution Account..........................58
Note Factor........................................45
Notes..............................................16
Obligor............................................18
Obligor Vehicles...................................68
OID................................................87
Optimal Principal Distributable Amount.............47
Optional Purchase..................................53
Optional Purchase Price............................53
Origination Trust..................................16
Origination Trust Agreement........................19
Origination Trust Assets...........................19
Origination Trustee................................19
Other SUBI.........................................16
Other SUBI Assets..................................65
</TABLE>
131
<PAGE> 133
<TABLE>
<CAPTION>
Term Page Term Page
- ---- ---- ---- ----
<S> <C> <C> <C>
Other SUBI Certificates............................19
Other SUBI Supplement..............................65
Owner Trustee......................................18
Partial Financial Component Advance................71
Partial Financial Component Payment................68
Participants.......................................48
Parties in Interest................................92
Payment Date.......................................45
Payment Date Advance Reimbursement.................52
Permitted Investments..............................59
Plan Assets Regulation.............................92
Plans..............................................92
Principal Carryover Shortfall......................46
Principal Distribution Amount......................46
Program Operating Lease............................16
Program Operating Lease Default....................55
Program Operating Lease Payments...................55
Program Operating Lease Termination Date...........55
PTCE...............................................92
Quarterly Principal Distributable Amount...........46
Rating Agency......................................17
Reallocation Payment...............................40
Record Date........................................45
Redemption Price...................................53
Registration Statement.............................95
Representative.....................................94
Required Deposit Rating............................58
Reserve Fund.......................................57
Reserve Fund Draw Amount...........................57
Reserve Fund Requirement...........................58
Residual Value.....................................30
Residual Value Losses..............................69
Residual Value Surplus.............................69
Residual Value Surplus Account.....................58
Residual Value Surplus Draw Amount.................58
Retained Administration Payment....................57
Retained Certificate Distribution Amount...........51
Retained SUBI Certificate..........................22
Retained SUBI Interest.............................16
RTR I LLC..........................................20
RTR I LP...........................................16
RTR II LLC.........................................20
RTR II LP..........................................16
RTR III LLC........................................22
Ryder..............................................16
Ryder System.......................................23
Sales Proceeds.....................................69
Sales Proceeds Advance.............................71
Salvage Casualty Proceeds..........................70
Schedule A.........................................24
Securities.........................................16
Securities Balance.................................46
Securitization Rate................................30
Securityholders....................................16
Senior Note Balance................................46
Senior Note Distribution Amount....................53
Senior Note Owner..................................47
Senior Noteholders.................................45
Senior Notes.......................................16
Series 1999-A SUBI.................................16
Short-Term Note....................................88
Special Event Purchase.............................69
Specified Leases...................................16
Specified Vehicles.................................16
SUBI...............................................16
SUBI Assets........................................16
SUBI Certificate Transfer Agreement................22
SUBI Certificates..................................16
SUBI Collection Account............................56
SUBI Interest......................................16
SUBI Supplement....................................21
SUBI Trust Agreement...............................21
Subordinated Note Balance..........................46
Subordinated Note Rate.............................56
Subordinated Noteholder............................57
Subordinated Notes.................................16
Substitute Vehicle.................................25
Taxes..............................................26
Termination Proceeds...............................69
Termination Value..................................27
Termination Value Payment..........................27
Titling Grace Period...............................21
Titling Grace Period Vehicles......................84
TLSA...............................................24
Total Monthly Payment..............................29
Transferor.........................................16
Transferor Certificate.............................17
Treasury Regulations...............................86
Trust..............................................16
Trust Administration Agreement.....................17
Trust Agent........................................19
Trust Agreement....................................17
Trust Estate.......................................18
Trust SUBI Certificate Transfer Agreement..........22
U.S. Bank..........................................19
UCC................................................48
Underwriters.......................................94
Underwriting Agreement.............................94
UTI................................................16
UTI Assets.........................................65
UTI Beneficiaries..................................16
UTI Certificates...................................19
Vehicle SUBI.......................................16
Vehicle SUBI Assets................................18
Vehicle SUBI Certificate...........................16
Vehicles...........................................19
Withholding Regulations............................90
</TABLE>
132
<PAGE> 134
Ryder Vehicle Lease Trust 1999-A
and Ryder Truck Rental LT
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Independent Auditors' Report for Ryder Vehicle Lease Trust 1999-A.................F-2
Ryder Vehicle Lease Trust 1999-A Balance Sheet....................................F-3
Ryder Vehicle Lease Trust 1999-A Notes to Balance Sheet...........................F-4
Independent Auditors' Report for Ryder Truck Rental LT............................F-6
Ryder Truck Rental LT Balance Sheet...............................................F-7
Ryder Truck Rental LT Statement of Operations.....................................F-8
Ryder Truck Rental LT Statement of Changes in Trust Equity........................F-9
Ryder Truck Rental LT Statement of Cash Flows.....................................F-10
Ryder Truck Rental LT Notes to Financial Statements...............................F-11
</TABLE>
F-1
<PAGE> 135
Independent Auditors' Report
Chase Manhattan Bank Delaware,
as Owner Trustee for
Ryder Vehicle Lease Trust 1999-A:
We have audited the accompanying balance sheet of Ryder Vehicle
Lease Trust 1999-A as of September 9, 1999. This financial statement is the
responsibility of the Trust's management. Our responsibility is to express an
opinion on this financial statement based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the balance sheet is free of
material misstatement. An audit of a balance sheet includes examining, on a test
basis, evidence supporting the amounts and disclosures in that balance sheet. An
audit of a balance sheet also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
balance sheet presentation. We believe that our audit of the balance sheet
provides a reasonable basis for our opinion.
In our opinion, the balance sheet referred to above presents fairly,
in all material respects, the financial position of Ryder Vehicle Lease Trust
1999-A as of September 9, 1999 in conformity with generally accepted accounting
principles.
KPMG LLP
Miami, Florida
September 9, 1999
F-2
<PAGE> 136
Ryder Vehicle Lease Trust 1999-A
Balance Sheet
September 9, 1999
ASSETS
Cash..............................................................$ 1,000
---------
Total assets......................................................$ 1,000
=========
LIABILITIES & TRUST EQUITY
Contributed Capital...............................................$ 1,000
---------
Total liabilities and trust equity................................$ 1,000
=========
See accompanying notes to balance sheet.
F-3
<PAGE> 137
Ryder Vehicle Lease Trust 1999-A
Notes to Balance Sheet
September 9, 1999
(1) ORGANIZATION
Ryder Vehicle Lease Trust 1999-A (the "Trust"), a Delaware business
trust, was formed on June 21, 1999. The purpose and responsibilities of the
Trust are described in the Amended and Restated Trust Agreement among Ryder
Funding LP and Chase Manhattan Bank Delaware, as owner trustee.
The Trust is organized under Chapter 38 of the Delaware Business Trust
Act. The purpose of the Trust is to conserve Trust assets and collect and
disburse the periodic income from such assets. In order to achieve this purpose
the Trust will a) issue securities, b) acquire a special unit of beneficial
interest ("SUBI") in Ryder Truck Rental LT, c) collect payments on the lease
of the SUBI, d) make payments on the securities, e) enter into and perform
obligations to which it is a party, and f) engage in other transactions
necessary, incidental to or connected with any of the foregoing activities.
Ryder Truck Rental LT (the "Origination Trust") was created by Ryder
Truck Rental, Inc. ("RTR") and acts as a custodian nominee holder of vehicle
titles to facilitate transfers of ownership of vehicles in connection with
securitizations. The Origination Trust reduces costs associated with
securitizations by eliminating the time and expense of re-titling vehicles upon
transfer of ownership of the vehicles to an issuer trust in a securitization.
RTR purchases vehicles that are nominally titled in the name of the Origination
Trust. The Origination Trust is a passive entity that is acting as a custodian
and serving as a nominee holder of record title to vehicles, with beneficial
ownership and use of the vehicles being vested in the holders of beneficial
interests in the trust. The initial beneficial interest in the Origination Trust
is held by entities which are wholly owned by RTR. Such beneficial ownership
interest in the vehicles is evidenced by ownership of 100% of the undivided
trust interest ("UTI") in the assets titled in the name of the Origination Trust
by RTR.
From time to time, and in connection with securitization transactions,
the owners of the UTI certificates will direct the Origination Trust to remove
certain vehicles from the UTI and transfer beneficial ownership of those
vehicles to a special unit of beneficial interest (a vehicle SUBI).
Concurrently, RTR will contribute the related commercial lease contracts to the
Origination Trust and direct the Origination Trust to transfer beneficial
ownership of those lease contracts to a special unit of beneficial interest (a
lease SUBI). A vehicle SUBI
F-4
<PAGE> 138
and lease SUBI represent the beneficial ownership interest transferred to an
issuer trust in a securitization,
The Trust will use the proceeds from the issuance and sale of senior
notes and other securities to purchase a vehicle SUBI. Payment of the senior
notes will be secured by the vehicle SUBI and a security interest in lease
contracts through the lease SUBI.
When the senior notes and other securities are issued, the Trust and
Ryder Funding LP (the "Transferor") will enter into a program operating lease,
under which the Transferor will make payments on the program operating lease in
an amount generally equal to certain financial component and termination value
payments made on or for the specified lease contracts and specified vehicles.
The Trust will apply these collected payments to pay interest on and
principal of the senior notes and other securities in accordance with their
terms. Payments of interest and principal on the senior notes and other
securities will be largely dependent upon receipt of payments on the program
operating lease, which is dependent upon payments on the underlying lease
contracts.
On September 9, 1999 Ryder Funding LP contributed $1,000 for the
initial undivided trust interests.
(2) INCOME TAXES
Neither the Trust nor any sub-trust constitutes a separate entity for
Federal income tax purposes or for state income or franchise purposes.
Accordingly, no taxes are provided for, as trust income is passed through to
the beneficiaries of the Trust.
F-5
<PAGE> 139
Independent Auditors' Report
RTRT Inc.,
as Trustee of
Ryder Truck Rental LT:
We have audited the accompanying balance sheets of Ryder Truck
Rental LT as of December 31, 1998 and 1997, and the related statements of
operations, changes in trust equity and cash flows for the year ended December
31, 1998 and for the period from July 23, 1997 (date of inception) through
December 31, 1997. These financial statements are the responsibility of the
Trust's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Ryder Truck Rental
LT as of December 31, 1998 and 1997, and the results of its operations and its
cash flows for the year ended December 31, 1998 and for the period from
inception through December 31, 1997 in conformity with generally accepted
accounting principles.
KPMG LLP
Miami, Florida
September 9, 1999
F-6
<PAGE> 140
Ryder Truck Rental LT
Balance Sheets
June 30, 1999 (unaudited) and
December 31, 1998 and 1997
DECEMBER 31,
JUNE 30, -----------------------
1999 1998 1997
----------- --------- --------
(unaudited)
ASSETS
Cash $ 76,176 75,055 75,000
-------- ------ ------
Total assets $ 76,176 75,055 75,000
======== ====== ======
LIABILITIES & TRUST EQUITY
Trust Equity $ 76,176 75,055 75,000
-------- ------ ------
Total liabilities and
trust equity $ 76,176 75,055 75,000
======== ====== ======
See accompanying notes to financial statements.
F-7
<PAGE> 141
Ryder Truck Rental LT
Statements of Operations
Six months ended June 30, 1999 (unaudited),
Year ended December 31, 1998 and
Period from July 23, 1997 (date of inception) through December 31, 1997
Six Months Year Ended Inception to
ended June 30, December 31, December 31,
1999 1998 1997
-------------- ------------ ------------
(unaudited)
REVENUE:
Interest income $ 1,121 55 0
-------- -------- -------
Total revenue 1,121 55 0
-------- -------- -------
EXPENSES:
Total expenses 0 0 0
-------- -------- -------
Net income $ 1,121 55 0
======== ======== =======
See accompanying notes to financial statements.
F-8
<PAGE> 142
Ryder Truck Rental LT
Statements of Changes in Trust Equity
Six Months Ended June 30, 1999
(unaudited), Year ended December 31, 1998
and period from July 23, 1997 (date of inception) through December 31, 1997
Capital Retained Trust
Contributions Earnings Equity
------------- ------------ ---------
Inception - July 23, 1997 $ -- -- --
Capital contributions 75,000 -- 75,000
Net income -- -- --
-------- --------- -------
Balance at December 31, 1997 75,000 -- 75,000
Net income -- 55 55
-------- --------- -------
Balance at December 31, 1998 75,000 55 75,055
Net income (unaudited) -- 1,121 1,121
-------- --------- -------
Balance at June 30, 1999
(unaudited) $ 75,000 1,176 76,176
======== ========= =======
See accompanying notes to financial statements.
F-9
<PAGE> 143
Ryder Truck Rental LT
Statements of Cash Flows
Six Months Ended June 30, 1999 (unaudited),
Year ended December 31, 1998 and
Period from July 23, 1997 (date of inception) through December 31, 1997
Six Months Year Ended Inception to
Ended June 30, December 31, December 31,
1999 1998 1997
---- ---- ----
(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES --
Net income $ 1,121 55 --
-------- -------- --------
Net cash provided
by operating activities 1,121 55 --
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES --
Payment of note receivable -- -- 75,000
-------- -------- --------
Net cash provided
by financing activities -- -- 75,000
-------- -------- --------
Net increase in cash 1,121 55 75,000
CASH AT BEGINNING OF PERIOD 75,055 75,000 0
-------- -------- --------
CASH AT END OF PERIOD $ 76,176 75,055 75,000
======== ======== ========
NON-CASH FINANCING ACTIVITIES -
During the period ended December 31, 1997, an initial capital contribution of
$75,000 was recorded in exchange for a non-interest bearing note receivable.
See accompanying notes to financial statements.
F-10
<PAGE> 144
Ryder Truck Rental LT
Notes to Financial Statements
December 31, 1998 and 1997
(1) ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Ryder Truck Rental LT (the "Origination Trust"), a Delaware business
trust, was formed on July 24, 1997. The purpose and responsibilities of the
Origination Trust are described in the Amended and Restated Trust Agreement
among RTR I L.P. and RTR II L.P., each of which is a Delaware limited
partnership, as beneficiaries, RTRT, Inc., a Delaware corporation, as trustee,
Delaware Trust Capital Management, Inc. and U.S. Bank National Association
as trust agent. The grantors of the Origination Trust are affiliates of Ryder
Truck Rental, Inc. ("RTR").
The Origination Trust was created by RTR and acts as a custodian
nominee holder of vehicle titles to facilitate transfers of ownership of
vehicles in connection with securitizations. The Origination Trust reduces costs
associated with securitizations by eliminating the time and expense of retitling
vehicles upon transfer of ownership of the vehicles to an issuer trust in a
securitization. RTR purchases vehicles that are nominally titled in the name of
the Origination Trust. The Origination Trust is a passive entity that is acting
as a custodian and serving as a nominee holder of record title to vehicles, with
beneficial ownership and use of the vehicles being vested in the holders of
beneficial interests in the trust. The initial beneficial interest in the
Origination Trust is held by entities which are wholly owned by RTR. Such
beneficial ownership interest in the vehicles is evidenced by ownership of 100%
of the undivided trust interest ("UTI") in the assets titled in the name of the
Origination Trust by RTR.
From time to time, and in connection with securitization transactions,
the owners of the UTI certificates will direct the Origination Trust to remove
certain vehicles from the UTI and transfer beneficial ownership of those
vehicles to a special unit of beneficial interest (a vehicle SUBI).
Concurrently, RTR will contribute the related commercial lease contracts to the
Origination Trust and direct the Origination Trust to transfer beneficial
ownership of those lease contracts to a special unit of beneficial interest (a
lease SUBI). The vehicle SUBI and lease SUBI represent the beneficial ownership
interest transferred to an issuer trust in a securitization.
RTR funds the initial purchase of the vehicles and records the
vehicles as assets on its balance sheet. The Origination Trust does not provide
any consideration to RTR when titles to the vehicles are transferred to it
other than a beneficial interest in the assets for which title
F-11
<PAGE> 145
has been transferred, and accordingly such vehicles are not recorded as assets
on the balance sheet of the Origination Trust.
As of December 31, 1998 the Origination Trust held title to 6,530
vehicles, of which 2,239 have been transferred to a vehicle SUBI.
In order to allow the Origination Trust to meet certain state
licensing requirements, the grantors of the Origination Trust contributed
$75,000 to the trust pursuant to a capital contribution agreement. The
agreement provides that such capital shall be permanent and refundable only in
the event of the liquidation of the Origination Trust.
(2) INCOME TAXES
Neither the Origination Trust nor any sub-trust constitutes a
separate entity for Federal income tax purposes or for state income or franchise
purposes. Accordingly, no taxes are provided on trust income as it is passed
through to the Origination Trust beneficiaries.
F-12
<PAGE> 146
ANNEX I
GLOBAL CLEARANCE, SETTLEMENT AND TAX DOCUMENTATION PROCEDURES
Except in some limited circumstances, the globally offered Senior Notes
(the "Global Securities") will be available only in book-entry form. Investors
in the Global Securities may hold such Global Securities through any of DTC,
Cedelbank or Euroclear. The Global Securities will be tradeable as home market
instruments in both the European and U.S. domestic markets. Initial settlement
and all secondary trades will settle in same-day funds.
Secondary market trading between investors holding Global Securities
through Cedelbank and Euroclear will be conducted in the ordinary way in
accordance with their normal rules and operating procedures and in accordance
with conventional eurobond practice, including seven calendar day settlement.
Secondary market trading between investors holding Global Securities
through DTC will be conducted according to the rules and procedures applicable
to U.S. corporate debt obligations.
Secondary cross-market trading between Cedelbank or Euroclear and DTC
Participants holding Senior Notes will be effected on a delivery-against-payment
basis through the respective Depositaries of Cedelbank and Euroclear, in that
capacity, and as DTC Participants.
Non-U.S. holders, as described below, of Global Securities will be
subject to U.S. withholding taxes unless such holders meet certain requirements
and deliver appropriate U.S. tax documents to the securities clearing
organizations or their participants.
INITIAL SETTLEMENT
All Global Securities will be held in book-entry form by DTC in the
name of Cede, as nominee of DTC. Investors' interests in the Global Securities
will be represented through financial institutions acting on their behalf as
direct and indirect Participants in DTC. As a result, Cedelbank and Euroclear
will hold positions on behalf of their participants through their respective
Depositaries, which in turn will hold such positions in accounts as DTC
Participants.
Investors electing to hold their Global Securities through DTC will
follow the settlement practices applicable to U.S. corporate debt obligations.
Investor securities custody accounts will be credited with their holdings
against payment in same-day funds on the settlement date.
Investors electing to hold their Global Securities through Cedelbank or
Euroclear accounts will follow the settlement procedures applicable to
conventional eurobonds, except that there will be no temporary global security
and no "lock-up" or restricted period. Global Securities will be credited to the
securities custody accounts on the settlement date against payment in the
same-day funds.
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<PAGE> 147
SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important
to establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
TRADING BETWEEN DTC PARTICIPANTS. Secondary market trading between DTC
Participants will be settled using the procedures applicable to U.S. corporate
debt obligations in same-day funds.
TRADING BETWEEN CEDELBANK AND/OR EUROCLEAR PARTICIPANTS. Secondary
market trading between Cedelbank Participants or Euroclear Participants will be
settled using the procedures applicable to conventional eurobonds in same-day
funds.
TRADING BETWEEN DTC SELLER AND CEDELBANK OR EUROCLEAR PURCHASER. When
Global Securities are to be transferred from the account of a DTC Participant to
the account of a Cedelbank Participant or a Euroclear Participant, the purchaser
will send instructions to Cedelbank or Euroclear through a Cedelbank Participant
or Euroclear Participant at least one business day prior to settlement.
Cedelbank or Euroclear will instruct the respective Depositary, as the case may
be, to receive the Global Securities against payment. Payment will include
interest accrued on the Global Securities from and including the last coupon
payment date to and excluding the settlement date, on the basis of actual days
elapsed and a 360-day year. Payment will then be made by the respective
Depositary to the DTC Participant's account against delivery of the Global
Securities. After settlement has been completed, the Global Securities will be
credited to the respective clearing system and by the clearing system, in
accordance with its usual procedures, to the Cedelbank Participant's or
Euroclear Participant's account. The Global Securities credit will appear the
next day, European time, and the cash debit will be back-valued to, and the
interest on the Global Securities will accrue from, the value date -- which
would be the preceding day when settlement occurred in New York. If settlement
is not completed on the intended value date, i.e., the trade fails, the
Cedelbank or Euroclear cash debit will be valued instead as of the actual
settlement date.
Cedelbank Participants and Euroclear Participants will need to make
available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to preposition
funds for settlement, either from cash on hand or existing lines of credit, as
they would for any settlement occurring within Cedelbank or Euroclear. Under
this approach, they may take on credit exposure to Cedelbank or Euroclear until
the Global Securities are credited to their accounts one day later.
As an alternative, if Cedelbank or Euroclear has extended a line of
credit to them, Cedelbank Participants or Euroclear Participants can elect not
to pre-position funds and allow that credit line to be drawn upon to finance the
settlement. Under this procedure, Cedelbank Participants or Euroclear
Participants purchasing Global Securities would incur overdraft charges for one
day, assuming they cleared the overdraft when the Global Securities were
credited to their accounts. However, interest on the Global Securities would
accrue from the value date. Therefore, in many cases the investment income on
the Global Securities earned during that one-day period may substantially reduce
or offset the amount of such overdraft charges, although this result will depend
on each Cedelbank Participant's or Euroclear Participant's particular cost of
funds.
A-2
<PAGE> 148
Since the settlement is taking place during New York business hours,
DTC Participants can employ their usual procedures for sending Global Securities
to the respective Depositary for the benefit of Cedelbank Participants or
Euroclear Participants. The sale proceeds will be available to the DTC seller on
the settlement date. Thus, to the DTC Participant a cross-market transaction
will settle no differently than a trade between two DTC Participants.
TRADING BETWEEN CEDELBANK OR EUROCLEAR SELLER AND DTC PURCHASER. Due to
time zone differences in their favor, Cedelbank Participants and Euroclear
Participants may employ their customary procedures for transactions in which
Global Securities are to be transferred by the respective clearing systems,
through the respective Depositaries, to a DTC Participant. The seller will send
instructions to Cedelbank or Euroclear through a Cedelbank Participant or
Euroclear Participant at least one business day prior to settlement. In these
cases, Cedelbank or Euroclear will instruct the respective Depositaries, as
appropriate, to deliver the Global Securities to the DTC Participant's account
against payment. Payment will include interest accrued on the Global Securities
from and including the last coupon payment date to and excluding the settlement
date on the basis of actual days elapsed and a 360-day year. The payment will
then be reflected in the account of the Cedelbank Participant or Euroclear
Participant the following day, and receipt of the cash proceeds in the Cedelbank
Participant's or Euroclear Participant's account would be back-valued to the
value date -- which would be the preceding day, when settlement occurred in New
York. Should the Cedelbank Participant or Euroclear Participant have a line of
credit with its respective clearing system and elect to be in debt in
anticipation of receipt of the sale proceeds in its account, the back-valuation
will extinguish any overdraft charges incurred over that one-day period. If
settlement is not completed on the intended value date, i.e., the trade fails,
receipt of the cash proceeds in the Cedelbank Participant's or Euroclear
Participant's account would instead be value as of the actual settlement date.
Finally, day traders that use Cedelbank or Euroclear and that purchase
Global Securities from DTC Participants for delivery to Cedelbank Participants
or Euroclear Participants should note that these trades would automatically fail
on the sale side unless affirmative action were taken. At least three techniques
should be readily available to eliminate this potential problem:
o borrowing through Cedelbank or Euroclear for one day -- until the
purchase side of the day trade is reflected in their Cedelbank or
Euroclear accounts -- in accordance with the clearing system's
customary procedures;
o borrowing the Global Securities in the U.S. from a DTC Participant
no later than one day prior to settlement, which would give the
Global Securities sufficient time to be reflected in their Cedelbank
or Euroclear account in order to settle the sale side of the trade;
or
o staggering the value dates for the buy and sell sides of the trade
so that the value date for the purchase from the DTC Participant is
at least one day prior to the value date for the sale to the
Cedelbank Participant or Euroclear Participant.
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<PAGE> 149
\
CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS
A beneficial owner of Global Securities holding through Cedelbank or
Euroclear, or through DTC if the holder has an address outside the U.S., will be
subject to the 30% U.S. withholding tax that generally applies to payments of
interest, including original issue discount, on registered debt issued by U.S.
Persons, unless:
o each clearing system, bank or other financial institution that holds
customers' securities in the ordinary course of its trade or
business in the chain of intermediaries between that beneficial
owner and the U.S. entity required to withhold tax complies with
applicable certification requirements, and
o that beneficial owner takes one of the following steps 'to obtain an
exemption or reduced tax rate.
EXEMPTION FOR NON-U.S. PERSONS -- FORM W-8. Beneficial owners of Global
Securities that are non-U.S. Persons can obtain a complete exemption from the
withholding tax by filing a signed Certificate of Foreign Status on Form W-8. If
the information shown on Form W-8 or the Tax Certificate changes, a new Form W-8
or Tax Certificate, as the case may be, must be filed within 30 days of that
change.
EXEMPTION FOR NON-U.S. PERSON WITH EFFECTIVELY CONNECTED INCOME -- FORM
4224. A non-U.S. Person, including a non-U.S. corporation or bank with a U.S.
branch, for which the interest income is effectively connected with its conduct
of a trade or business in the United States, can obtain an exemption from the
withholding tax by filing a certificate of Exemption from Withholding of Tax on
Income Effectively Connected with the Conduct of a Trade or Business in the
United States on Form 4224.
EXEMPTION OR REDUCED RATE FOR NON-U.S. PERSONS RESIDENT IN TREATY
COUNTRIES -- FORM 1001. Non-U.S. Persons that are beneficial owners of Global
Securities residing in a country that has a tax treaty with the United States
can obtain an exemption or reduced tax rate, depending on the treaty terms, by
filing an Ownership, Exemption or Reduced Rate Certificate on Form 1001. If the
treaty provides only for a reduced rate, withholding tax will be imposed at that
rate unless the filer alternatively files Form W-8. Form 1001 may be filed by
the Senior Note Owner or his agent.
EXEMPTION FOR U.S. PERSONS -- FORM W-9. U.S. Persons can obtain a
complete exemption from the withholding tax by filing a Payer's Request for
Taxpayer Identification Number and Certification on Form W-9.
U.S. FEDERAL INCOME TAX REPORTING PROCEDURE. The beneficial owner of a
Global Security or, in the case of a Form 1001 or a Form 4224 filer, his agent,
files by submitting the appropriate form to the person through whom it holds --
the clearing agency, in the case of persons holding directly on the books of the
clearing agency. Form W-8 and form 1001 are effective for three calendar years
and Form 4224 is effective for one calendar year.
A-4
<PAGE> 150
The term "U.S. Person" means:
o a citizen or resident of the United States,
o a corporation, partnership or other entity organized in or under the
laws of the United States or any state or political subdivision
thereof (other than a partnership that is not treated as a United
States person under any applicable Treasury regulations),
o an estate whose income is subject to United States federal income
tax, regardless of its source, or
o a trust whose administration is subject to the primary supervision
of a United States court and which has one or more United States
persons who have authority to control all substantial decisions of
the trust.
Notwithstanding the preceding sentence, to the extent provided in regulations,
some trusts in existence on August 20, 1996 and treated as United States persons
prior to such date that elect to continue to be so treated also shall be
considered U.S. Persons.
This summary does not deal with all aspects of U.S. Federal income tax
withholding that may be relevant to foreign holders of the Global Securities.
Investors are advised to consult their own tax advisors for specific tax advice
concerning their holding and disposing of the Global Securities.
A-5
<PAGE> 151
$
-------------
(RYDER LOGO)
RYDER VEHICLE LEASE TRUST 1999-A
RYDER FUNDING L.P.
Transferor
RYDER TRUCK RENTAL, INC.
Administrative Agent
ASSET BACKED
SENIOR NOTES:
$_____________ _____% Class A-1 Notes
$_____________ _____% Class A-2 Notes
$_____________ _____% Class A-3 Notes
$_____________ _____% Class A-4 Notes
--------------
PROSPECTUS
--------------
MERRILL LYNCH & CO.
You should rely only the information contained in this prospectus. We have not
authorized anyone to provide you with different information.
We are not offering the Senior Notes in any state where the offer is not
permitted.
For 90 days after the date of this prospectus all dealers that effect
transactions in the Senior Notes, whether or not they are participating in this
offering, may be required to deliver a prospectus. This is in addition to the
dealers' obligation to deliver a prospectus when acting as underwriters and with
respect to their unsold allotments or subscriptions.
_____________, 1999
<PAGE> 152
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Expenses in connection with the offering of the Senior Notes being
registered hereby are estimated as follows:
<TABLE>
<CAPTION>
<S> <C>
SEC registration fee............................................................ $
Legal fees and expenses......................................................... 450,000
Accounting fees and expenses.................................................... 120,000
Blue sky fees and expenses...................................................... 15,000
Rating agency fees.............................................................. 200,000
Trustee's fees and expenses..................................................... 50,000
Printing........................................................................ 150,000
Miscellaneous................................................................... *
----------
Total........................................................................ $
==========
</TABLE>
- -----------------
* To be completed by amendment.
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 17-108 of the Delaware Revised Uniform Limited Partnership Act
provides that, subject to such standards and restrictions, if any, as are set
forth in its partnership agreement, a limited partnership may and shall have the
power to, indemnify and hold harmless any partner or other person from and
against any and all claims and demands whatsoever.
Pursuant to Section 5.08 of the Agreement of Limited Partnership of
Ryder Funding LP (the "Transferor"), the Transferor will, to the fullest extent
permitted by law, indemnify its general partner, Ryder Truck Rental III LLC, and
its directors, officers, agents and employees acting within the scope of their
authority (the "Indemnified Parties") from and against any loss, expense damage,
liability or injury suffered or sustained by them by reason of any acts,
omissions or alleged acts or omissions arising out of any of such Indemnified
Party's activities on behalf of the Transferor or in furtherance of the interest
of the Transferor, provided that the acts, omissions, or alleged acts or
omissions upon which such actual or threatened action is based were not made or
omitted fraudulently or in bad faith or constituted willful misconduct or gross
negligence by such Indemnified Party.
Pursuant to Section 5.08 of the Agreement of Limited Partnership of
Ryder Truck Rental I LP ("RTR I LP"), the Transferor will, to the fullest extent
permitted by law, indemnify its general partner, Ryder Truck Rental I LLC, and
its directors, officers, agents and employees acting within the scope of their
authority (the "RTR I LP Indemnified Parties") from and against any loss,
expense damage, liability or injury suffered or sustained by them by reason of
any acts, omissions or alleged acts or omissions arising out of any of such RTR
I LP Indemnified Party's activities on behalf of RTR I LP or in furtherance of
the interest of RTR I LP, provided that the acts, omissions, or alleged acts or
omissions upon which such actual or threatened action is based
II-1
<PAGE> 153
were not made or omitted fraudulently or in bad faith or constituted willful
misconduct or gross negligence by such RTR I LP Indemnified Party.
Pursuant to Section 5.08 of the Agreement of Limited Partnership of
Ryder Truck Rental II LP ("RTR II LP"), the Transferor will, to the fullest
extent permitted by law, indemnify its general partner, Ryder Truck Rental II
LLC, and its directors, officers, agents and employees acting within the scope
of their authority (the "RTR II LP Indemnified Parties") from and against any
loss, expense damage, liability or injury suffered or sustained by them by
reason of any acts, omissions or alleged acts or omissions arising out of any of
such RTR II LP Indemnified Party's activities on behalf of RTR II LP or in
furtherance of the interest of RTR II LP, provided that the acts, omissions, or
alleged acts or omissions upon which such actual or threatened action is based
were not made or omitted fraudulently or in bad faith or constituted willful
misconduct or gross negligence by such RTR II LP Indemnified Party.
Reference is also made to Section __ of the Underwriting Agreement
among the Transferor, RTR, Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated and the other underwriters named therein (see Exhibit 1.1),
which provides for indemnification by the Transferor in certain circumstances.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
Not applicable.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
a. Exhibits:
1.1 Form of Underwriting Agreement**
3.1 Certificate of Formation of Ryder Truck Rental III LLC**
3.2 Limited Liability Company Agreement of Ryder Truck Rental III LLC**
3.3 Agreement of Limited Partnership of Ryder Funding LP, dated as of
April 23, 1998, between Ryder Truck Rental, Inc. and Ryder Truck
Rental III LLC**
3.4 Certificate of Formation of Ryder Truck Rental I LLC**
3.5 Limited Liability Company Agreement of Ryder Truck Rental I LLC**
3.6 Agreement of Limited Partnership of Ryder Truck Rental I LP, dated as
of June 1, 1997, between Ryder Truck Rental, Inc. and Ryder Truck
Rental I LLC**
4.1 Form of Indenture between Ryder Vehicle Lease Trust 1999-A and U.S.
Bank National Association, as Indenture Trustee (including forms of
Senior Notes)***
5.1 Opinion of Steel Hector & Davis LLP with respect to legality**
8.1 Opinion of Steel Hector & Davis LLP with respect to federal income
tax matters***
8.2 Opinion of Steel Hector & Davis LLP with respect to Florida income
tax matters**
10.1 Second Amended and Restated Trust Agreement among Ryder Truck Rental
I LP, Ryder Truck Rental II LP, Ryder Truck Rental, Inc., Delaware
Trust Capital Management, Inc., RTRT, Inc. and U.S. Bank National
Association, dated as of February 1, 1998***
10.2 Form of Supplement 1999-A to Second Amended and Restated Trust
Agreement among Ryder Truck Rental I LP, Ryder Truck Rental II LP,
Ryder Truck Rental, Inc., Delaware Trust Capital Management, Inc.,
RTRT, Inc. and U.S. Bank National Association (including form of the
SUBI Certificates)***
10.3 Administration Agreement between RTRT, Inc. and Ryder Truck Rental,
Inc., dated as of February 1, 1998***
10.4 Form of Supplement 1999-A to Administration Agreement between RTRT,
Inc. and Ryder Truck Rental, Inc.***
10.5 Form of SUBI Certificate Transfer Agreement between Ryder Truck
Rental I LP and Ryder Funding LP***
10.6 Form of Issuer SUBI Certificate Transfer Agreement between Ryder
Funding LP and Ryder Vehicle Lease Trust 1999-A***
II-2
<PAGE> 154
10.7 Form of Amended and Restated Trust Agreement between Ryder Funding LP
and Chase Manhattan Bank Delaware, as Owner Trustee***
10.8 Form of Program Operating Lease between Ryder Vehicle Lease Trust
1999-A and Ryder Funding LP***
23.1 Consent of Steel Hector & Davis LLP (included in Exhibits 5.1,
8.1 and 8.2)
23.2 Consent of Brown & Wood LLP**
23.3 Consent of Richards, Layton & Finger, P.A.**
23.4 Consent of KPMG LLP***
24.1 Power of Attorney*
25.1 Statement of Eligibility and Qualification of the Indenture Trustee
on Form T-1**
- ---------------------------
* Previously filed.
** To be filed by amendment.
*** Filed herewith.
b. Financial Statement Schedules:
Not applicable.
ITEM 17. UNDERTAKINGS.
Each undersigned Registrant hereby undertakes as follows:
(a) To provide to the Underwriters at the closing date specified in the
Underwriting Agreement certificates in such denominations and registered in such
names as required by the Underwriters to provide prompt delivery to each
purchaser.
(b) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is therefore unenforceable. In the event that a claim
for indemnification against such liabilities (other than payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of such Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
(c) For purposes of determining any liability under the Act, the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Act will be deemed to be part of this registration statement as of the
time it was declared effective.
(d) For purposes of determining any liability under the Act, each
post-effective amendment that contains a form of prospectus will be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time will be deemed to be the initial bona
fide offering thereof.
II-3
<PAGE> 155
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Amendment No. 2 to the Registration Statement on
Form S-1 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Miami and State of Florida, on the 15th day of
October, 1999.
RYDER FUNDING LP, a Delaware limited partnership
By: RYDER TRUCK RENTAL III LLC, a Delaware
limited liability company, its general
partner
By: RTR LEASING II, INC., a Delaware
corporation, its manager
By: James B. Griffin
President
II-4
<PAGE> 156
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Amendment No. 2 to the Registration Statement on
Form S-1 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Miami and State of Florida, on the 15th day of
October, 1999.
RYDER TRUCK RENTAL I LP, a Delaware limited
partnership
By: RYDER TRUCK RENTAL I LLC, a Delaware
limited liability company, its general partner
By: RTR LEASING I, INC., a Delaware corporation, its
manager
By: James B. Griffin
President
II-5
<PAGE> 157
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Amendment No. 2 to the Registration Statement on
Form S-1 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Miami and State of Florida, on the 15th day of
October, 1999.
RYDER TRUCK RENTAL LT, a Delaware business
trust
By: RYDER TRUCK RENTAL, INC., a Florida
corporation, its administrative agent
By: James B. Griffin
President
II-6
<PAGE> 158
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Amendment No. 2 to the Registration Statement on
Form S-1 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Miami and State of Florida, on the 15th day of
October, 1999.
RYDER VEHICLE LEASE TRUST 1999-A, a
Delaware trust
By: RYDER FUNDING LP, a Delaware limited
partnership, solely as originator of
Ryder Vehicle Lease Trust 1999-A
By: RYDER TRUCK RENTAL III LLC, a Delaware
limited liability company, its general
partner
By: RTR LEASING II, INC., a Delaware
corporation, its manager
By: James B. Griffin
President
II-7
<PAGE> 159
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 2 to the Registration Statement on Form S-1 has been signed by the
following persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ James B. Griffin Director and President of the Manager of October 15, 1999
the General Partner of
RYDER TRUCK RENTAL I LP, RYDER TRUCK
RENTAL II LP and RYDER FUNDING LP
(Principal Executive Officer)
George P. Scanlon* Vice President & Controller of the Manager October 15, 1999
of the General Partner of
RYDER TRUCK RENTAL I LP, RYDER TRUCK
RENTAL II LP and RYDER FUNDING LP
(Principal Financial and Accounting
Officer)
M. Anthony Burns* Director of the Manager of the General October 15, 1999
Partner of RYDER TRUCK RENTAL I LP,
RYDER TRUCK RENTAL II LP and RYDER
FUNDING LP
Edwin A. Huston* Director of the Manager of the General October 15, 1999
Partner of RYDER TRUCK RENTAL I LP,
RYDER TRUCK RENTAL II LP and RYDER FUNDING
LP
John M. Beeson Jr.* Director of the Manager of the General October 15, 1999
Partner of RYDER TRUCK RENTAL I LP, RYDER
TRUCK RENTAL II LP and RYDER FUNDING LP
Michael J. Blake* Director of the Manager of the General October 15, 1999
Partner of RYDER TRUCK RENTAL I LP,
RYDER TRUCK RENTAL II LP and RYDER
FUNDING LP
</TABLE>
*By: /s/ W. Daniel Susik
Attorney-in-fact
II-8
<PAGE> 160
EXHIBIT INDEX
1.1 Form of Underwriting Agreement**
3.1 Certificate of Formation of Ryder Truck Rental III LLC**
3.2 Limited Liability Company Agreement of Ryder Truck Rental III LLC**
3.3 Agreement of Limited Partnership of Ryder Funding LP, dated as of
April 23, 1998, between Ryder Truck Rental, Inc. and Ryder Truck
Rental III LLC**
3.4 Certificate of Formation of Ryder Truck Rental I LLC**
3.5 Limited Liability Company Agreement of Ryder Truck Rental I LLC**
3.6 Agreement of Limited Partnership of Ryder Truck Rental I LP, dated as
of June 1, 1997, between Ryder Truck Rental, Inc. and Ryder Truck
Rental I LLC**
4.1 Form of Indenture between Ryder Vehicle Lease Trust 1999-A and U.S.
Bank National Association, as Indenture Trustee (including forms of
Senior Notes)***
5.1 Opinion of Steel Hector & Davis LLP with respect to legality**
8.1 Opinion of Steel Hector & Davis LLP with respect to federal income
tax matters***
8.2 Opinion of Steel Hector & Davis LLP with respect to Florida income
tax matters**
10.1 Second Amended and Restated Trust Agreement among Ryder Truck Rental
I LP, Ryder Truck Rental II LP, Ryder Truck Rental, Inc., Delaware
Trust Capital Management, Inc., RTRT, Inc. and U.S. Bank National
Association, dated as of February 1, 1998***
10.2 Form of Supplement 1999-A to Second Amended and Restated Trust
Agreement among Ryder Truck Rental I LP, Ryder Truck Rental II LP,
Ryder Truck Rental, Inc., Delaware Trust Capital Management, Inc.,
RTRT, Inc. and U.S. Bank National Association (including form of the
SUBI Certificates)***
10.3 Administration Agreement between RTRT, Inc. and Ryder Truck Rental,
Inc., dated as of February 1, 1998***
10.4 Form of Supplement 1999-A to Administration Agreement between RTRT,
Inc. and Ryder Truck Rental, Inc.***
10.5 Form of SUBI Certificate Transfer Agreement between Ryder Truck
Rental I LP and Ryder Funding LP***
10.6 Form of Issuer SUBI Certificate Transfer Agreement between Ryder
Funding LP and Ryder Vehicle Lease Trust 1999-A***
10.7 Form of Amended and Restated Trust Agreement between Ryder Funding LP
and Chase Manhattan Bank Delaware, as Owner Trustee***
10.8 Form of Program Operating Lease between Ryder Vehicle Lease Trust
1999-A and Ryder Funding LP***
23.1 Consent of Steel Hector & Davis LLP**
23.2 Consent of Brown & Wood LLP**
23.3 Consent of Richards, Layton & Finger, P.A.**
23.4 Consent of KPMG LLP***
24.1 Power of Attorney*
25.1 Statement of Eligibility and Qualification of the Indenture Trustee
on Form T-1**
- --------------------------
* Previously filed.
** To be filed by amendment.
*** Filed herewith.
II-9
<PAGE> 1
Exhibit 4.1
===============================================================================
RYDER VEHICLE LEASE TRUST 1999-A
_____ % Asset Backed Notes, Class A-1
_____ % Asset Backed Notes, Class A-2
_____ % Asset Backed Notes, Class A-3
_____ % Asset Backed Notes, Class A-4
U.S. BANK NATIONAL ASSOCIATION,
as Indenture Trustee,
and
RYDER VEHICLE LEASE TRUST 1999-A,
As Issuer
INDENTURE
Dated as of October 1, 1999
===============================================================================
<PAGE> 2
TRUST INDENTURE ACT CROSS-REFERENCE CHART
(this chart is not a part of this Indenture)
TIA Section Indenture Reference
- ----------- -------------------
310(a)(1)...............................................6.08, 6.11
310(a)(2)...............................................6.11
310(a)(3)...............................................6.10(b)
310(a)(4)...............................................Not Applicable
310(a)(5)...............................................6.11
310(b)..................................................6.11
310(c)..................................................Not Applicable
311(a)..................................................6.15
311(b)..................................................6.15
311(c)..................................................Not Applicable
312(a)..................................................7.01, 7.02(a)
312(b)..................................................7.02(b)
312(c)..................................................7.02(c)
313(a)..................................................7.03
313(b)..................................................7.03
313(c)..................................................7.03
313(d)..................................................7.03
314(a)..................................................3.09
314(b)..................................................3.06
314(c)(1)...............................................11.01(a)
314(c)(2)...............................................11.01(a)
314(c)(3)...............................................Not Applicable
314(d)..................................................3.09(a), 8.06, 11.01(a)
314(e)..................................................11.01(a)
315(a)..................................................6.01(b)
315(b)..................................................6.05
315(c)..................................................6.01(a)
315(d)..................................................6.01(c)
315(d)(1)...............................................6.01(b), 6.01(c)(i)
315(d)(2)...............................................6.01(c)(ii)
315(d)(3)...............................................6.01(c)(iii)
315(e)..................................................5.13
316(a)..................................................5.11; 5.12
316(a)(1)(A)............................................5.11
316(a)(1)(B)............................................5.12
316(a)(2)...............................................Not Applicable
316(b)..................................................5.07
316(c)..................................................5.06(b)
317(a)(1)...............................................5.03(a), 5.03(b)
317(a)(2)...............................................5.03(d)
317(b)..................................................3.03
318(a)..................................................11.19
<PAGE> 3
TABLE OF CONTENTS
Page
----
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions................................................ 2
Section 1.02. Interpretive Provisions.................................... 13
ARTICLE TWO
THE SENIOR NOTES
Section 2.01. Form....................................................... 14
Section 2.02. Execution, Authentication and Delivery..................... 14
Section 2.03. Temporary Senior Notes..................................... 15
Section 2.04. Registration; Registration of Transfer and Exchange........ 15
Section 2.05. Mutilated, Destroyed, Lost or Stolen Senior Notes.......... 16
Section 2.06. Persons Deemed Owners...................................... 17
Section 2.07. Cancellation............................................... 17
Section 2.08. Release of Collateral...................................... 18
Section 2.09. Book-Entry Notes........................................... 18
Section 2.10. Notices to Clearing Agency................................. 19
Section 2.11. Definitive Notes........................................... 19
Section 2.12. Authenticating Agents...................................... 19
ARTICLE THREE
COVENANTS
Section 3.01. Payment of Principal and Interest.......................... 21
Section 3.02. Maintenance of Office or Agency............................ 21
Section 3.03. Money for Payments to be Held in Trust..................... 21
Section 3.04. Existence.................................................. 23
Section 3.05. Protection of Trust Estate................................. 23
Section 3.06. Opinions as to Trust Estate................................ 23
Section 3.07. Performance of Obligations; Administration of the 1999-A
SUBI Assets.............................................. 24
Section 3.08. Negative Covenants......................................... 25
Section 3.09. Issuer Certificates and Reports............................ 26
Section 3.10. Restrictions on Certain Other Activities................... 27
Section 3.11. Notice of Defaults......................................... 27
Section 3.12. Further Instruments and Acts............................... 27
Section 3.13. Delivery of 99% 1999-A Vehicle SUBI Certificate............ 27
Section 3.14. Delivery of the Subordinated Notes......................... 27
Section 3.15. Compliance with Laws....................................... 27
<PAGE> 4
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture.................... 28
Section 4.02. Application of Trust Money................................. 29
Section 4.03. Repayment of Monies Held by Paying Agent................... 29
ARTICLE FIVE
INDENTURE DEFAULT
Section 5.01. Indenture Defaults......................................... 30
Section 5.02. Acceleration of Maturity; Waiver of Indenture Default...... 31
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee........................................ 32
Section 5.04. Remedies; Priorities....................................... 34
Section 5.05. Optional Preservation of the 1999-A SUBI Assets............ 36
Section 5.06. Limitation of Suits........................................ 36
Section 5.07. Unconditional Rights of Senior Noteholders to Receive
Principal and Interest................................... 37
Section 5.08. Restoration of Rights and Remedies......................... 37
Section 5.09. Rights and Remedies Cumulative............................. 37
Section 5.10. Delay or Omission Not a Waiver............................. 37
Section 5.11. Control by Senior Noteholders.............................. 37
Section 5.12. Waiver of Past Defaults.................................... 38
Section 5.13. Undertaking for Costs...................................... 38
Section 5.14. Waiver of Stay or Extension Laws........................... 39
Section 5.15. Action on Senior Notes..................................... 39
Section 5.16. Performance and Enforcement of Certain Obligations......... 39
Section 5.17. Sale of Trust Estate....................................... 40
ARTICLE SIX
THE INDENTURE TRUSTEE
Section 6.01. Duties of Indenture Trustee................................ 41
Section 6.02. Rights of Indenture Trustee................................ 42
Section 6.03. Individual Rights of Indenture Trustee..................... 43
Section 6.04. Indenture Trustee's Disclaimer............................. 44
Section 6.05. Notice of Defaults......................................... 44
Section 6.06. Reports by Indenture Trustee to Senior Noteholders......... 44
Section 6.07. Compensation and Indemnity................................. 44
Section 6.08. Replacement of Indenture Trustee........................... 45
Section 6.09. Successor Indenture Trustee by Merger...................... 46
Section 6.10. Appointment of Co-Trustee or Separate Trustee.............. 47
Section 6.11. Eligibility; Disqualification.............................. 48
Section 6.12. Trustee as Holder of 99% 1999-A Vehicle SUBI Certificate... 48
Section 6.13. Representations and Warranties of Indenture Trustee........ 48
Section 6.14. Furnishing of Documents.................................... 49
Section 6.15. Preferential Collection Of Claims Against The Issuer....... 49
<PAGE> 5
ARTICLE SEVEN
SENIOR NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. Issuer to Furnish Indenture Trustee Senior Noteholder
Names and Addresses...................................... 50
Section 7.02. Preservation of Information; Communications to
Senior Noteholders....................................... 50
Section 7.03. Reports by Indenture Trustee............................... 50
ARTICLE EIGHT
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money........................................ 51
Section 8.02. Accounts................................................... 51
Section 8.03. Payment Date Certificate................................... 51
Section 8.04. Disbursement of Funds...................................... 53
Section 8.05. General Provisions Regarding Accounts...................... 57
Section 8.06. Release of Trust Estate.................................... 58
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent of Senior
Noteholders.............................................. 59
Section 9.02. Supplemental Indentures With Consent of Senior
Noteholders.............................................. 60
Section 9.03. Execution of Supplemental Indentures....................... 61
Section 9.04. Effect of Supplemental Indenture........................... 61
Section 9.05. Reference in Senior Notes to Supplemental Indentures....... 62
ARTICLE TEN
REDEMPTION OF SENIOR NOTES
Section 10.01. Redemption................................................ 63
Section 10.02. Form of Redemption Notice................................. 63
Section 10.03. Senior Notes Payable on Redemption Date................... 64
ARTICLE ELEVEN
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions...................... 65
Section 11.02. Form of Documents Delivered to Indenture Trustee.......... 66
Section 11.03. Acts of Senior Noteholders................................ 67
Section 11.04. Notices................................................... 68
Section 11.05. Notices to Senior Noteholders; Waiver..................... 68
<PAGE> 6
Section 11.06. Effect of Headings and Table of Contents.................. 69
Section 11.07. Successors and Assigns.................................... 69
Section 11.08. Severability.............................................. 69
Section 11.09. Benefits of Indenture..................................... 69
Section 11.10. Legal Holidays............................................ 69
Section 11.11. Governing Law............................................. 69
Section 11.12. Counterparts.............................................. 69
Section 11.13. Recording of Indenture.................................... 69
Section 11.14. Trust Obligation.......................................... 69
Section 11.15. No Petition............................................... 70
Section 11.16. No Recourse............................................... 70
Section 11.17. Inspection................................................ 71
Section 11.18. Limitation of Liability of Owner Trustee.................. 71
Section 11.19. TIA Incorporation and Conflicts........................... 71
EXHIBITS
Exhibit A Form of Senior Note.......................................A-1
Exhibit B Form of Depository Agreement..............................B-1
<PAGE> 7
INDENTURE
This Indenture, dated as of October 1, 1999, is between the Ryder
Vehicle Lease Trust 1999-A, a Delaware business trust (the "Issuer"), and U.S.
Bank National Association, a national banking association, as trustee (the
Indenture Trustee").
Each party agrees as follows for the benefit of the other parties and
for the equal and ratable benefit of the holders of the Issuer's [_______]%
Asset Backed Notes, Class A-1 (the "Class A-1 Notes"), [_______]% Asset Backed
Notes, Class A-2 (the "Class A-2 Notes"), [_______]% Asset Backed Notes, Class
A-3 (the "Class A-3 Notes"), [_______]% Asset Backed Notes, Class A-4 (the
"Class A-4 Note" and, together with the Class A-1 Notes, Class A-2 Notes and
Class A-3 Notes, the "Senior Notes"):
GRANTING CLAUSE
The Issuer, to secure the payment of principal of and interest on, and
any other amounts owing in respect of, the Senior Notes, equally and ratably
without prejudice, priority or distinction except as set forth herein, and to
secure compliance with the provisions of this Indenture, hereby Grants in trust
to the Indenture Trustee on the Closing Date, as trustee for the benefit of the
Senior Noteholders, all of the Issuer's right, title and interest, whether now
owned or hereafter acquired, in and to (i) the Trust Estate and (ii) all
present and future claims, demands, causes and choses in action in respect of
any or all of the foregoing and all payments on or under and all proceeds of
every kind and nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion, voluntary or involuntary, into cash
or other liquid property, all cash proceeds, accounts, accounts 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, securities, financial
assets and other property that at any time constitute all or part of or are
included in the proceeds of any of the foregoing (collectively, the
"Collateral"), in each case as such terms are defined herein.
The Indenture Trustee, as trustee on behalf of the Senior Noteholders,
acknowledges the foregoing Grant, accepts the trusts under this Indenture in
accordance with the provisions of this Indenture and agrees to perform its
duties required in this Indenture to the best of its ability to the end that
the interests of the Senior Noteholders may be adequately and effectively
protected.
<PAGE> 8
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions. Capitalized terms used herein that are not
otherwise defined shall have the meanings ascribed thereto in the SUBI Trust
Agreement or the Administration Agreement, as the case may be. Whenever used
herein, unless the context otherwise requires, the following words and phrases
have the following meanings:
"Accounts" means the Note Distribution Account: and the Reserve Fund.
"Accrual Period" means, with respect to any Payment Date, the period
from and including the l5th day of the month in which the preceding Payment
Date occurred (or, in the case of the first Payment Date or if no interest has
yet been paid, from and including the Closing Date) to and including the l4th
day of the month in which such Payment Date occurs.
"Act" has the meaning set forth in Section 11.03(a).
"Administration Agreement" means the Basic Administration Agreement as
supplemented by that certain 1999-A supplement, dated as of October 1, 1999,
among the parties to the Basic Administration Agreement, as amended or
supplemented from time to time with respect to the 1999-A SUBI.
"Administrator" means the Administrator, or any successor
Administrator under the Issuer Administration Agreement.
"Authenticating Age" means any Person authorized by the Indenture
Trustee to act on behalf of the Indenture Trustee to authenticate and deliver
the Senior Notes.
"Authorized Newspaper" means a newspaper of general circulation in The
City of New York, printed in the English language and customarily published on
each Business Day, whether or not published on Saturdays, Sundays and holidays.
"Authorized Officer" means, with respect to the Issuer, (i) any
officer of the Owner Trustee who is authorized to act for the Owner Trustee in
matters relating to the Issuer and who is identified on the list of Authorized
Officers delivered by the Owner Trustee to the Indenture Trustee on the Closing
Date and (ii) so long as the Issuer Administration Agreement is in effect, any
of the following officers of the Administrator, each of whom is authorized to
act for the Administrator in matters relating to the Issuer pursuant to the
Issuer Administration Agreement: the President, any Vice President, the
Treasurer, any Assistant Treasurer, the Secretary and any Assistant Secretary.
"Available Funds" means, for any Payment Date and the related
Collection Period, the sum of the following amounts: (i) 99% of SUBI
Collections, (ii) Advances, (iii) 99% of the Residual Value Surplus Draw Amount
and (iv) in the case of an Optional Purchase, the Optional Purchase Price.
2
<PAGE> 9
"Available Funds Shortfall Amount" means, for any Payment Date and the
related Collection Period, the amount by which Securityholder Available Funds
is less than the amount necessary to make the distributions in clauses (i)
through (iv) of Section 8.04(a), except that the Optimal Principal
Distributable Amount rather than the Quarterly Principal Distributable Amount
shall be used for purposes of clause (iv).
"Available Principal Distribution Amount" means an amount equal to the
sum of (i) the amount of Available Funds remaining after the Administrative
Agent has been paid the Payment Date Advance Reimbursement and the
Administration Fee, and after accrued interest has been paid on the Securities,
and (ii) the Reserve Fund Draw Amount, if any, remaining after accrued interest
has been paid on the Securities.
"Back-up Security Agreement" means that certain back-up security
agreement dated as of October 1, 1999, among Ryder, the Origination Trust, RTR
I LP, the Transferor, the Issuer and the Indenture Trustee.
"Basic Administration Agreement" means that certain administration
agreement, dated as of February 1, 1998, among the UTI Beneficiaries, Ryder, as
administrative agent, RTRT, Inc., as trustee, Delaware Trust Capital
Management, Inc., as Delaware trustee, and U.S. Bank, as trust agent.
"Book-Entry Notes" means a beneficial interest in the Senior Notes,
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.09.
"Business Day" means any day other than a Saturday, a Sunday or a day
on which banking institutions in the states of Delaware, Florida, Illinois or
New York are authorized or obligated by law, executive order or government
decree to be closed.
"Certificate Balance" has the meaning set forth in the Trust Agreement.
"Certificate Distribution Amount" means, as of any Payment Date, the
amount being distributed to the Trust Certificateholders on such Payment Date.
"Certificate Factor" has the meaning set forth in the Trust Agreement.
"Certificate Rate" has the meaning set forth in the Trust Agreement.
"Class" means a group of Senior Notes whose form is identical except
for variation in denomination, principal amount or owner, and references to
"each Class" thus mean each of the Class A-1 Notes, the Class A-2 Notes, the
Class A-3 Notes and the Class A-4 Notes.
3
<PAGE> 10
"Class A-1 Interest Rate" means [______] % per annum (computed on the
basis of the actual number of days elapsed, but assuming a 360-day year of
twelve 30-day months).
"Class A-2 Interest Rate" means [______] % per annum (computed on the
basis of a 360-day year of twelve 30-day months).
"Class A-3 Interest Rate" means [______] % per annum (computed on the
basis of a 360-day year of twelve 30-day months).
"Class A-4 Interest Rate" means [______] % per annum (computed on the
basis of a 360-day year of twelve 30-day months).
"Class A-1 Note Balance" means, as of any date, the Initial Class A-1
Note Balance reduced by all payments of principal made on or prior to such date
on the Class A-1 Notes.
"Class A-2 Note Balance" means, as of any date, the Initial Class A-2
Note Balance reduced by all payments of principal made on or prior to such date
on the Class A-2 Notes.
"Class A-3 Note Balance" means, as of any date, the Initial Class A-3
Note Balance reduced by all payments of principal made on or prior to such date
on the Class A-3 Notes.
"Class A-4 Note Balance" means, as of any date, the Initial Class A-4
Note Balance reduced by all payments of principal made on or prior to such date
on the Class A-4 Notes.
"Clearing Agency " means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act and shall initially be DTC.
"Clearing Agency Participant" means a broker, dealer, bank or other
financial institution or other Person for which from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with
the Clearing Agency.
"Closing Date" means [_________], 1999.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" has the meaning set forth in the Granting Clause.
"Commission" means the U.S. Securities and Exchange Commission.
"Corporate Trust Office" means the office of the Indenture Trustee at
which at any particular time its corporate trust business shall be
administered, which office at the date of the execution of this Indenture is
located at One Illinois Center, 111 East Wacker Drive, Suite 3000, Chicago,
Illinois 60601; or at such other address as the Indenture Trustee may designate
from time to time by notice to the Senior Noteholders and the Issuer, or the
principal corporate trust office of any successor Indenture Trustee (the
address of which the successor Indenture Trustee shall notify the Senior
Noteholders and the Issuer).
4
<PAGE> 11
"Default" means any occurrence that is, or with notice or lapse of
time or both would become, an Indenture Default.
"Definitive Note" means a definitive fully registered Senior Note.
"Deposit Date" means the Business Day immediately preceding each
Payment Date.
"Depository Agreement" means the agreement among the Issuer, the
Indenture Trustee and DTC, as the initial Clearing Agency, dated as of the
Closing Date, substantially in the form of Exhibit B.
"DCR" means Duff & Phelps Credit Rating Co.
"DTC" means The Depository Trust Company, and its successors.
"Eligible Account" means an account maintained with a depository
institution or trust company (i) (a) the short-term unsecured debt obligations
of which have the Required Deposit Rating or (b) having a long-term unsecured
debt rating acceptable to each Rating Agency and corporate trust powers and
(ii) which is maintained in a segregated trust account in the corporate trust
department of such depository institution or trust company.
"Excess Amounts" means the amount remaining after the distributions
from the 1999-A SUBI Collection Account provided for in clauses (i) through
(iv) of Section 8.04(a), in the amount and priority set forth therein, have
been made.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Executive Officer" means, with respect to any (i) corporation or
depository institution, the Chief Executive Officer, Chief Operating Officer,
Chief Financial Officer, President, Executive Vice President, any Vice
President, the Secretary or the Treasurer of such corporation or depository
institution, and (ii) any partnership, any general partner thereof.
"Grant" means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create and grant a lien upon and a
security interest in and right of set-off against, deposit, set over and
confirm pursuant to this Indenture, and, with respect to the Collateral or any
other agreement or instrument, shall include all rights, powers and options
(but none of the obligations) of the granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments in respect of the Collateral and all other
monies payable thereunder, to give and receive notices and other
communications, to make waivers or other agreements, to exercise all rights and
options, to bring Proceedings in the name of the granting party or otherwise
and generally to do and receive anything that the granting party is or may be
entitled to do or receive thereunder or with respect thereto.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
5
<PAGE> 12
"Indenture Default" has the meaning set forth in Section 5.01.
"Independent" means, when used with respect to any specified Person,
that such Person (i) is in fact independent of the Issuer, any other obligor
upon the Senior Notes, the Administrator and any Affiliate of any of the
foregoing Persons, (ii) does not have any direct financial interest or any
material indirect financial interest in the Issuer, any such other obligor, the
Administrator or any Affiliate of any of the foregoing Persons and (iii) is not
connected with the Issuer, any such other obligor, the Administrator 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 11.0 1 (b),
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 this Indenture and that the signer is
Independent within the meaning thereof.
"Initial Class A-1 Note Balance" means $[__________].
"Initial Class A-2 Note Balance" means $[__________].
"Initial Class A-3 Note Balance" means $[__________].
"Initial Class A-4 Note Balance" means $[__________].
"Initial Securities Balance" has the meaning set forth in the Trust
Agreement.
"Initial Senior Note Balance" means the sum of the Initial Class A-1
Note Balance, the Initial Class A-2 Note Balance, the Initial Class A-3 Note
Balance and the Initial Class A-4 Note Balance.
"Interest Rate" means the Class A-1 Interest Rate, Class A-2 Interest
Rate, Class A-3 Interest Rate, Class A-4 Interest Rate or the Overdue Interest
Rate, as applicable.
"Issuer" means the Ryder Vehicle Lease Trust 1999-A, until a successor
replaces it and, thereafter, means the successor and, for purposes of any
provision contained herein, each other obligor on the Senior Notes.
"Issuer Administration Agreement" means that certain issuer
administration agreement, dated as of the date hereof, among the Administrator,
the Issuer, the Transferor and the Indenture Trustee.
6
<PAGE> 13
"Issuer SUBI Certificate Transfer Agreement" means that certain issuer
SUBI certificate transfer agreement, dated as of October 1, 1999, between the
Transferor, as transferor, and the Issuer, as transferee, as amended or
supplemented from time to time.
"Issuer Order" and "Issuer Request" means a written order or request
of the Issuer signed in the name of the Issuer by any one of its Authorized
Officers and delivered to the Indenture Trustee.
"Note Distribution Account" means the trust account established by the
Transferor pursuant to Section 8.02, into which amounts released from the
1999-A SUBI Collection Account and the Reserve Fund for distribution to Senior
Noteholders shall be deposited and from which all distributions to Senior
Noteholders shall be made.
"Note Factor" means, with respect to the Senior Notes on any Payment
Date, the seven digit decimal equivalent of a fraction the numerator of which
is the Senior Note Balance on such Payment Date (after giving effect to any
payment of principal on such Payment Date) and the denominator of which is the
Initial Senior Note Balance.
"Officer's Certificate" means a certificate signed by an Authorized
Officer of the Issuer, under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.01, and delivered to,
the Indenture Trustee.
"Opinion of Counsel" means one or more written opinions of counsel who
may, except as otherwise expressly provided in this Indenture, be employees of
or counsel to the Issuer or the Administrator, and who shall be satisfactory to
the Indenture Trustee, and which opinion or opinions shall be addressed to the
Indenture Trustee, comply with any applicable requirements of Section 11.01 and
be in form and substance satisfactory to the Indenture Trustee.
"Optimal Principal Distributable Amount" means, for any Payment Date
and the related Collection Period, an amount equal to the sum of the following
amounts:
(i) for each Specified Vehicle for which the related Specified Lease
did not terminate during such Collection Period, the difference between the
Securitization Value of such Specified Lease at the beginning and at the end of
such Collection Period;
(ii) for each Specified Vehicle for which the related Specified Lease
reached its Maturity Date during such Collection Period, the Securitization
Value of such Specified Lease as of such Maturity Date;
(iii) for each Specified Lease terminated by the related Lessee or the
Administrative Agent during such Collection Period pursuant to exercise of the
Annual Termination Option, the related Securitization Value as of the effective
date of termination;
(iv) for each Specified Vehicle purchased by the Administrative Agent
before its Maturity Date, the Securitization Value of the related Specified
Lease as of the date of such purchase;
7
<PAGE> 14
(v) for each Specified Vehicle that became the subject of a Casualty
Termination Lease during such Collection Period, the Securitization Value of
the related Specified Lease as of the date of such Casualty Termination; and
(vi) for each Specified Lease that became a Default Termination Lease
during such Collection Period, the related Securitization Value as of the date
such Specified Lease became a Default Termination Lease.
"Optional Purchase Price" has the meaning set forth in Section
10.01(a).
"Origination Trust" means Ryder Truck Rental LT.
"Origination Trust Agreement" means that certain second amended and
restated trust agreement, dated as of February 1, 1998, among Ryder Truck
Rental I LP and Ryder Truck Rental II LP, as grantors and initial
beneficiaries, Ryder, as administrative agent, Delaware Trust Capital
Management, Inc., as Delaware trustee, RTRT, Inc., as trustee, and U.S. Bank,
as trust agent.
"Origination Trust Trustee" means RTRT, Inc., in its capacity as
Trustee of the Origination Trust.
"Outstanding" means, as of any date, all Senior Notes (or all Senior
Notes of an applicable Class) theretofore authenticated and delivered under
this Indenture except:
(i) Senior Notes (or Senior Notes of an applicable Class) theretofore
cancelled by the Senior Note Registrar or delivered to the Senior Note
Registrar for cancellation;
(ii) Senior Notes (or Senior Notes of an applicable Class) 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 related Senior Noteholders (provided, however, that if such Senior
Notes are to be redeemed, notice of such redemption has been duly given
pursuant to this Indenture or provision therefor, satisfactory to the Indenture
Trustee, has been made); and
(iii) Senior Notes (or Senior Notes of an applicable Class) in
exchange for or in lieu of other Senior Notes (or Senior Notes of such Class)
that have been authenticated and delivered pursuant to this Indenture unless
proof satisfactory to the Indenture Trustee is presented that any such Senior
Notes are held by a bona fide purchaser;
provided, that in determining whether Senior Noteholders holding the requisite
Outstanding Amount have given any request, demand, authorization, direction,
notice, consent or waiver hereunder or under any Basic Document, Senior Notes
owned by the Issuer, the Transferor, the Administrator or any of their
respective Affiliates shall be disregarded and deemed not to be Outstanding,
except that, in determining whether the Indenture Trustee shall be protected in
relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Senior Notes that a Responsible Officer knows to be so
owned shall be so disregarded. Senior Notes so owned that have been pledged in
good faith may be regarded as Outstanding if the pledgee thereof establishes to
the satisfaction of the Indenture Trustee such pledgee's right so to act with
respect to such Senior Notes and that such pledgee is not the Issuer, the
Transferor, the Administrator or any of their respective Affiliates.
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"Outstanding Amount" means, as of any date, the aggregate principal
amount of the applicable Senior Notes Outstanding, reduced by all payments of
principal made in respect thereof on or prior to such date.
"Overdue Interest Rate" means, with respect to any Class, the Interest
Rate applicable to such Class.
"Paying Agent" means the Indenture Trustee or any other Person that
meets the eligibility standards for the Indenture Trustee set forth in Section
6.11 and is authorized by the Issuer to make the payments to and distributions
from the Note Distribution Account, including the payment of principal of or
interest on the Senior Notes on behalf of the Issuer.
"Payment Date Certificate" has the meaning set forth in Section
8.03(a).
"Person" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust (including any beneficiary
thereof), unincorporated organization or government or any agency or political
subdivision thereof.
"Predecessor Note" means, with respect to any particular Senior Note,
every previous Senior Note evidencing all or a portion of the same debt as that
evidenced by such particular Senior Note; and, for the purpose of this
definition, any Senior Note authenticated and delivered under Section 2.05 in
lieu of a mutilated, destroyed, lost or stolen Senior Note shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Senior Note.
"Principal Carryover Shortfall" means, as of the close of any Payment
Date, the sum of the excess, if any, of the then Principal Distribution Amount
over the Quarterly Principal Distributable Amount.
"Principal Distribution Amount" means, for any Payment Date, the
aggregate amount of principal payable on the Securities, equal to the greater
of (A) the sum of (i) the Optimal Principal Distributable Amount and (ii) any
Principal Carryover Shortfall as of the preceding Payment Date and (B) if the
amount on deposit in the Reserve Fund after giving effect to all deposits and
withdrawals referenced in clause (i) of the definition of the Reserve Fund Draw
Amount exceeds the unpaid balance of the Securities, the Securities Balance.
Notwithstanding the above, the Principal Distribution Amount shall not exceed
the outstanding Securities Balance.
"Proceeding" means any suit in equity, action at law or other judicial
or administrative
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"Program Operating Lease" means that certain program operating lease,
dated as of October 1, 1999, between the Transferor and the Issuer.
"Quarterly Principal Distributable Amount" means an amount equal to
the lesser of (i) the Principal Distribution Amount and (ii) the Available
Principal Distribution Amount.
"Rating Agency Condition" means, with respect to any action, that each
Rating Agency shall have been given ten Business Days (or such shorter period
as is acceptable to each Rating Agency) prior notice thereof and that each
Rating Agency shall have notified the Transferor, the Administrator and the
Issuer in writing that such action will not result in a Rating Event.
"Rating Event" means the qualification, reduction or withdrawal by
either Rating Agency of its then-current rating of the Senior Notes or the
Trust Certificates.
"Record Date" means, with respect to a Payment Date or Redemption
Date, the close of business on the Business Day immediately preceding such
Payment Date or Redemption Date.
"Redemption Date" means in the case of a redemption of the Senior
Notes pursuant to Section 10.01, the Payment Date specified by the
Administrator or the Issuer pursuant to Section 10.01.
"Redemption Price" means an amount equal to the unpaid principal
amount of the Senior Notes redeemed plus accrued and unpaid interest thereon at
the applicable Interest Rate for the Senior Notes being so redeemed, up to but
excluding the Redemption Date.
"Registered Holder" means the Person in whose name a Senior Note is
registered on the Senior Note Register on the related Record Date.
"Repayment Price" has the meaning set forth in the Trust Agreement.
"Reserve Fund" has the meaning set forth in the Trust Agreement.
"Reserve Fund Deposit Amount" means, with respect to any Payment Date,
an amount equal to the sum of (i) all payments in respect of interest on and
principal of the Subordinated Notes, (ii) any Excess Amounts with respect to
the related Collection Period and (iii) net income realized on the investment
of funds on deposit in the 1999-A SUBI Collection Account, the Residual Value
Surplus Account and the Reserve Fund.
"Reserve Fund Draw Amount" means, for any Payment Date, the amount
withdrawn from the Reserve Fund, equal to the sum of (i) the lesser of (a) the
Available Funds Shortfall Amount, if any, and (b) the amount on deposit in the
Reserve Fund after giving effect to all deposits thereto on the related Deposit
Date or such Payment Date, and (ii) in the event the amount on deposit in the
Reserve Fund, after giving effect to all withdrawals therefrom and deposits
thereto in respect of such Payment Date, exceeds the unpaid balance of the
Securities, the Securities Balance.
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"Reserve Fund Property" has the meaning set forth in the Issuer SUBI
Certificate Transfer Agreement.
"Reserve Fund Requirement" means (i) on any Payment Date other than a
Payment Date described in clause (ii), an amount equal to [_______]% of the
Initial Securities Balance or (ii) on any Payment Date occurring on or after
the earlier to occur of the date on which the last remaining Specified Lease
terminated or the date on which the Program Operating Lease is terminated
following a Program Operating Lease Default, zero.
"Residual Note" has the meaning set forth in Section 2.02.
"Residual Value Surplus Draw Amount" means, on each Deposit Date, the
withdrawal made from the Residual Value Surplus Account in an amount equal to
the lesser of (i) the sum of all Residual Value Losses, if any, and any
unreimbursed Disposition Expenses in respect of related Specified Vehicles sold
or otherwise disposed of by the Administrative Agent during the related
Collection Period and (ii) the amount on deposit in the Residual Value Surplus
Account.
"Responsible Officer" means, with respect to the Indenture Trustee,
any officer within Corporate Trust (or any successor group of the Indenture
Trustee), including any Vice President, Assistant Secretary or other officer or
assistant officer of the Indenture Trustee customarily performing functions
similar to those performed by the people who at such time shall be officers, or
to whom any corporate trust matter is referred within Corporate Trust because
of his knowledge of and familiarity with the particular subject.
"Ryder" means Ryder Truck Rental, Inc., and its successors.
"Securities" means the Trust Certificates, the Subordinated Notes and
the Senior Notes, collectively.
"Securities Balance" has the meaning set forth in the Trust Agreement.
"Secured Obligations" has the meaning set forth in the Issuer SUBI
Certificate Transfer Agreement.
"Securityholder Available Funds" means on each Payment Date, all
remaining Available Funds after giving effect to the payment to the
Administrative Agent pursuant to Section 11.04(a)(v) of the Administration
Agreement of (i) the Payment Date Advance Reimbursement and (ii) the
Administration Fee, together with any unpaid Administration Fees in respect of
one or more Collection Periods.
"Senior Note" means a Class A-1 Note, Class A-2 Note, Class A-3 Note
or Class A-4 Note, in each case substantially in the form of Exhibit A hereto.
"Senior Note Balance" means the sum of the Class A-1 Note Balance, the
Class A-2 Note Balance, the Class A-3 Note Balance and the Class A-4 Note
Balance.
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"Senior Note Distribution Amount" means, as of any Payment Date, the
amount being distributed to the Senior Noteholders on such Payment Date.
"Senior Note Final Payment Date" means, with respect to a Class A-1
Note [______] 15, 20[__]; with respect to a Class A-2 Note, [______] 15,
20[__]; with respect to a Class A-3 Note, [______] 15, 20[__]; and with respect
to a Class A-4 Note, [______] 15, 20[__].
"Senior Noteholder" means, as of any date, the Person in whose name a
Senior Note is registered on the Senior Note Register on such date.
"Senior 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 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).
"Senior Note Register" and "Senior Note Registrar" have the respective
meanings set forth in Section 2.04.
"SUBI Trust Agreement" means the Origination Trust Agreement as
supplemented by that certain supplement, dated as of October 1, 1999, among the
parties to the Origination Trust Agreement, as amended or supplemented from
time to time.
"Subordinated Note" has the meaning set forth in the Trust Agreement.
"Subordinated Note Rate" has the meaning set forth in the Trust
Agreement.
"Subordinated Note Redemption Price" has the meaning set forth in the
Trust Agreement.
"TIA" means the Trust Indenture Act of 1939, as amended and as in
force on the date hereof, unless otherwise specifically provided.
"Trust Agreement" means that certain trust agreement, as amended and
restated as of October 1, 1999, between the Transferor and the Owner Trustee.
"Trust Certificate" has the meaning set forth in the Trust Agreement.
"Trust Estate" means all money, accounts, chattel paper, general
intangibles, goods, instruments, investment property and other property subject
or intended to be subject to the lien and security interest of this Indenture
for the benefit of the Senior Noteholders (including the Collateral Granted to
the Indenture Trustee), including (i) the 99% 1999-A Vehicle SUBI Certificate
(transferred pursuant to the Issuer SUBI Certificate Transfer Agreement),
evidencing a 99% beneficial interest in the 1999-A Vehicle SUBI Assets,
including the right to payments thereunder from certain Sales Proceeds on
deposit in the 1999-A SUBI Collection Account and the Residual Value Surplus
Account and investment earnings, net of losses and investment expenses, on
amounts on deposit in the 1999-A SUBI Collection Account and the Residual Value
Surplus Account, (ii) the rights of the Issuer under the Program Operating
Lease, (iii) the rights of the Issuer under the Back-up Security Agreement,
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(iv) the rights of the Issuer to the funds on deposit from time to time in the
Note Distribution Account and any other account or accounts established
pursuant to the Indenture and all cash, investment property and other property
from time to time credited thereto and all proceeds thereof, (v) the rights of
the Transferor, as transferee under the SUBI Certificate Transfer Agreement,
(vi) the rights of the Issuer, as transferee under the Issuer SUBI Certificate
Transfer Agreement, (vii) the rights of the Issuer as a third-party beneficiary
of the Administration Agreement, including the right to certain Advances, and
the SUBI Trust Agreement, (viii) the security interest of the Issuer in the
Subordinated Notes and in the Reserve Fund Property; (ix) the pledge to and
security interest of the Issuer in the 99% 1999-A Lease SUBI Certificate, and
(x) all proceeds of the foregoing.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code as in effect in the relevant jurisdiction, as amended from time
to time.
"United States" means the United States of America.
"UTI Beneficiary" means Ryder Truck Rental I LP or Ryder Truck Rental
II LP, each in its capacity as an initial Beneficiary of the Origination Trust,
and its permitted successors and assigns.
Section 1.02. Interpretive Provisions.
(a) For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires, (i) terms used in this
Indenture include, as appropriate, all genders and the plural as well as the
singular, (ii) references to words such as "herein", "hereof" and the like
shall refer to this Indenture as a whole and not to any particular part,
Article or Section within this Indenture, (iii) the term "include" and all
variations thereof shall mean "include without limitation", (iv) the term "or"
shall include "and/or" and (v) the term "proceeds" shall have the meaning set
forth in the applicable UCC.
(b) As used in this Indenture and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Indenture or in any such certificate or other document, and accounting
terms partly defined in this Indenture 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 Indenture 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 Indenture or
in any such certificate or other document shall control.
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ARTICLE TWO
THE SENIOR NOTES
Section 2.01. Form. The Senior Notes, together with the Indenture
Trustee's certificate of authentication, shall be in substantially the form set
forth as Exhibit A hereto, 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 Senior Notes, as evidenced by
their execution of such Senior Notes. Any portion of the text of any Senior
Note may be set forth on the reverse thereof, with an appropriate reference
thereto on the face of such Senior Note.
The terms of the Senior Notes set forth in Exhibit A hereto are part
of the terms of this Indenture.
Section 2.02. Execution, Authentication and Delivery. The Senior Notes
shall be executed by the Owner Trustee on behalf of the Issuer. The signature of
any authorized officer of the Owner Trustee on the Senior Notes may be manual or
by facsimile. Senior Notes bearing the manual or facsimile signature of
individuals who were at any time authorized officers of the Owner Trustee shall
bind the Issuer, notwithstanding that any such individuals have ceased to hold
such offices prior to the authentication and delivery of such Senior Notes or
did not hold such offices at the date of such Senior Notes.
The Indenture Trustee shall, upon Issuer Order, authenticate and
deliver for original issue the following aggregate principal amounts of the
Senior Notes: (i) $[________] of Class A-1 Notes, (ii) $[_______] of Class A-2
Notes, (iii) $[________] of Class A-3 Notes and (iv) $[________] of Class A-4
Notes. The aggregate principal amount of Class A-1 Notes, Class A-2 Notes,
Class A-3 Notes and Class A-4 Notes outstanding at any time may not exceed such
respective amounts, except as provided in Section 2.05.
Each Senior Note shall be dated the date of its authentication. The
Senior Notes shall be issuable as registered notes in book-entry form in
minimum denominations of $ 1,000 and in integral multiples of $ 1,000 in excess
thereof; provided, however, that on the Closing Date, one Class A-1 Note, one
Class A-2 Note, one Class A-3 Note and one Class A-4 Note may be issued in a
denomination that includes any remaining portion of the Initial Class A-1 Note
Balance, the Initial Class A-2 Note Balance, the Initial Class A-3 Note Balance
and the Initial Class A-4 Note Balance, respectively (each, a "Residual Note").
No Senior Note shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Senior
Note a certificate of authentication substantially in the form provided for
herein executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Senior Note shall be
conclusive evidence, and the only evidence, that such Senior Note has been duly
authenticated and delivered hereunder.
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Section 2.03. Temporary Senior Notes. Pending the preparation of
Definitive Notes, the Owner Trustee may execute, on behalf of the Issuer, and
upon receipt of an Issuer Order, the Indenture Trustee shall authenticate and
deliver, temporary Senior Notes that are printed, lithographed, typewritten,
mimeographed or otherwise produced, substantially 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
Senior Notes may determine, as evidenced by their execution of such Senior
Notes.
If temporary Senior Notes are issued, the Issuer shall cause
Definitive Notes to be prepared without unreasonable delay. After the
preparation of Definitive Notes, the temporary Senior Notes shall be
exchangeable for Definitive Notes upon surrender of such temporary Senior Notes
at the office or agency of the Issuer to be maintained as provided in Section
3.02, without charge to the related Senior Noteholder. Upon surrender for
cancellation of any one or more temporary Senior Notes, the Owner Trustee shall
execute, on behalf of the Issuer, and the Indenture Trustee shall authenticate
and deliver in exchange therefor, a like principal amount of Definitive Notes
of authorized denominations. Until so exchanged, such temporary Senior 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 "Senior Note Register") in which,
subject to such reasonable regulations as it may prescribe, the Issuer shall
provide for the registration of Senior Notes and the registration of transfers
of Senior Notes. The Indenture Trustee is hereby appointed the "Senior Note
Registrar" for the purpose of registering Senior Notes and transfers of Senior
Notes as herein provided. Upon any resignation of any Senior Note Registrar, the
Issuer shall promptly appoint a successor or, if it elects not to make such an
appointment, assume the duties of Senior Note Registrar.
If a Person other than the Indenture Trustee is appointed by the
Issuer as Senior Note Registrar, the Issuer shall give the Indenture Trustee
prompt written notice of such appointment and the location, and any change in
such location, of the Senior Note Register, and the Indenture Trustee shall
have the right to inspect the Senior 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 Senior Note Registrar by an
Executive Officer as to the names and addresses of the Senior Noteholders and
the principal amounts and number of such Senior Notes.
Upon surrender for registration of transfer of any Senior Note at the
office or agency of the Issuer to be maintained as provided in Section 3.02, if
the requirements of Section 8-401 of the UCC are met, the Owner Trustee shall
execute, on behalf of the Issuer, and the Indenture Trustee shall authenticate
and the related Senior Noteholder shall obtain from the Indenture Trustee, in
the name of the designated transferee, one or more new Senior Notes in any
authorized denominations, of a like aggregate principal amount.
At the option of the related Senior Noteholder, Senior Notes may be
exchanged for other Senior Notes in any authorized denominations, of a like
aggregate principal amount, upon surrender of such Senior Notes at such office
or agency. Whenever any Senior Notes are so surrendered for exchange, if the
requirements of Section 8-401 of the UCC are met, the Owner Trustee shall
execute, on behalf of the Issuer, the Indenture Trustee shall authenticate and
the Senior Noteholder shall obtain from the Indenture Trustee the Senior Notes
that the Senior Noteholder making such exchange is entitled to receive.
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Every Senior Note presented or surrendered for registration of
transfer or exchange shall (if so required by the Issuer or the Indenture
Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form and substance satisfactory to the Issuer and the Indenture
Trustee, duly executed by the Senior Noteholder thereof or its attorney-in-fact
duly authorized in writing.
All Senior Notes issued upon any registration of transfer or exchange
of Senior Notes shall be the valid obligations of the Issuer, evidencing the
same debt and entitled to the same benefits under this Indenture as the Senior
Notes surrendered upon such registration of transfer or exchange.
No service charge shall be made to a Senior Noteholder for any
registration of transfer or exchange of Senior 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 therewith, other than exchanges
pursuant to Sections 2.03 or 9.05 not involving any transfer.
The preceding provisions of this Section notwithstanding, the Issuer
shall not be required to make, and the Senior Note Registrar need not register,
transfers or exchanges of any Senior Note (i) selected for redemption or (ii)
for a period of 15 days preceding the due date for any payment with respect to
such Senior Note.
Section 2.05. Mutilated, Destroyed, Lost or Stolen Senior Notes. If
(i) any mutilated Senior Note is surrendered to the Indenture Trustee, or the
Indenture Trustee receives evidence to its satisfaction of the destruction,
loss or theft of any Senior Note and (ii) there is delivered to the Indenture
Trustee such security or indemnity as may be required by it to hold the Issuer,
the Owner Trustee and the Indenture Trustee harmless, then, in the absence of
notice to the Owner Indenture Trustee, the Senior Note Registrar or the
Indenture Trustee that such Senior Note has been acquired by a "protected
purchase" (as contemplated by Article Eight of the UCC), and provided that the
requirements of Section 8-405 of the UCC are met, the Owner Trustee shall
execute, on behalf of the Issuer, and upon Issuer Request the Indenture Trustee
shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Senior Note, a replacement Senior Note;
provided, however, that if any such destroyed, lost or stolen Senior Note (but
not a mutilated Senior Note) shall have become or within seven days shall
become due and payable, or shall have been called for redemption, instead of
issuing a replacement Senior Note, the Issuer may pay such destroyed, lost or
stolen Senior Note when so due or payable or upon the Redemption Date without
the surrender thereof. If, after the delivery of such replacement Senior Note
or payment of a destroyed, lost or stolen Senior Note pursuant to the proviso
to the preceding sentence, a "protected purchaser" (as contemplated by Article
Eight of the UCC) of the original Senior Note in lieu of which such replacement
Senior Note was issued presents for payment such original Senior Note, the
Issuer and the Indenture Trustee shall be entitled to recover such replacement
Senior Note (or such payment) from the Person to whom it was delivered or any
Person taking such replacement Senior Note from such Person to whom such
replacement Senior Note was delivered or any assignee of such Person, except a
"protected purchaser" (as contemplated by Article Eight of the UCC), 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.
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Upon the issuance of any replacement Senior Note under this Section,
the Issuer or the Indenture Trustee may require the payment by the related
Senior Noteholder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other reasonable
expenses (including the fees and expenses of the Indenture Trustee or the
Senior Note Registrar) connected therewith.
Every replacement Senior Note issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Senior Note shall
constitute an original additional contractual obligation of the Issuer, whether
or not the mutilated, destroyed, lost or stolen Senior 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 Senior 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 Senior Notes.
Section 2.06. Persons Deemed Owners. Prior to due presentment for
registration of transfer of any Senior Note, the Issuer, the Indenture Trustee
and their respective agents may treat the Person in whose name any Senior Note
is registered (as of the date of determination) as the owner of such Senior
Note for the purpose of receiving payments of principal of and interest, if
any, on such Senior Note and for all other purposes whatsoever, whether or not
such Senior Note be overdue, and neither the Issuer, the Indenture Trustee nor
any of their respective agents shall be affected by notice to the contrary.
Section 2.07. Cancellation. All Senior 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 Senior Notes
previously authenticated and delivered hereunder that the Issuer may have
acquired in any manner whatsoever, and all Senior Notes so delivered shall be
promptly cancelled by the Indenture Trustee. No Senior Notes shall be
authenticated in lieu of or in exchange for any Senior Notes cancelled as
provided in this Section, except as expressly permitted by this Indenture. All
cancelled Senior 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 that such
Senior Notes have not been previously disposed of by the Indenture Trustee.
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Section 2.08. Release of Collateral. Subject to Section 11.01 and the
terms of the Basic Documents, the Indenture Trustee shall release property from
the lien of this Indenture only upon receipt of an Issuer Request.
Section 2.09. Book-Entry Notes. Unless otherwise specified, the Senior
Notes (except for any Residual Notes), upon original issuance, will be issued
in the form of one or more typewritten Senior Notes representing the Book-Entry
Notes, to be delivered to the Indenture Trustee, as agent for DTC, the initial
Clearing Agency, by, or on behalf of, the Issuer. One fully registered Senior
Note shall be issued with respect to each $100 million in principal amount of
each Class of Senior Notes or such lesser amount as necessary. Such Senior
Notes shall initially be registered on the Senior Note Register in the name of
Cede & Co., the nominee of the initial Clearing Agency, and no Senior Note
Owner shall receive a Definitive Note representing such Senior Note Owner's
interest in such Senior Note except as provided in Section 2.11. Unless and
until Definitive Notes have been issued to Senior Note Owners pursuant to
Section 2.11:
(a) the provisions of this Section shall be in full force and effect;
(b) the Senior 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 Senior Notes and the
giving of instructions or directions hereunder) as the sole Senior Noteholder,
and shall have no obligation to Senior Note Owners;
(c) to the extent that the provisions of this Section conflict with
any other provisions of this Indenture, the provisions of this Section shall
control;
(d) the rights of Senior Note Owners shall be exercised only through
the Clearing Agency and shall be limited to those established by law and
agreements between or among such Senior Note Owners and the Clearing Agency or
Clearing Agency Participants; pursuant to the Depository Agreement, unless and
until Definitive Notes are issued pursuant to Section 2.11, the initial
Clearing Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit payments of principal of and interest on
the Senior Notes to such Clearing Agency Participants; and
(e) whenever this Indenture requires or permits actions to be taken
based upon instructions or directions of Senior Noteholders evidencing a
specified percentage of the Outstanding Amount, the Clearing Agency shall be
deemed to represent such percentage only to the extent that it has received
instructions to such effect from Senior Note Owners or Clearing Agency
Participants owning or representing, respectively, such required percentage of
the beneficial interest in the Senior Notes and has delivered such instructions
to the Indenture Trustee.
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Section 2.10. Notices to Clearing Agency. Whenever a notice or other
communication to Senior Noteholders is required under this Indenture, unless
and until Definitive Notes shall have been issued to Senior Note Owners
pursuant to Section 2.11, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Senior Noteholders to the
Clearing Agency, and shall have no obligation to the Senior Note Owners.
Section 2.11. Definitive Notes. If (i) (A) the Administrator advises
the Indenture Trustee in writing that the Clearing Agency is no longer willing
or able to properly discharge its responsibilities as described in the
Depository Agreement and (B) the Indenture Trustee or the Administrator is
unable to locate a qualified successor, (ii) the Administrator 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 an Indenture
Default, Senior Note Owners representing in the aggregate not less than 51 % of
the Outstanding Amount advise the Indenture Trustee through the Clearing Agency
and its Participants in writing that the continuation of a book-entry system
through the Clearing Agency or its successor is no longer in the best interest
of Senior Note Owners, the Indenture Trustee shall be required to notify all
Senior Note Owners, through the Clearing Agency, of the occurrence of such
event and the availability through the Clearing Agency of Definitive Notes to
Senior Note Owners requesting the same. Upon surrender to the Indenture Trustee
by the Clearing Agency of the Senior Note or Senior Notes representing the
Book-Entry Notes and the receipt of instructions for re-registration, the
Indenture Trustee shall issue Definitive Notes to Senior Note Owners, who
thereupon shall become Senior Noteholders for all purposes of this Indenture.
None of the Owner Trustee, the Senior 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.
The Indenture Trustee shall not be liable if the Indenture Trustee or
the Administrator is unable to locate a qualified successor Clearing Agency.
The Definitive Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of such methods (with or without steel engraved
borders), all as determined by the officers executing such Senior Notes, as
evidenced by their execution of such Senior Notes.
If Definitive Notes are issued and the Indenture Trustee is not the
Senior Note Registrar, the Owner Trustee shall furnish or cause to be furnished
to the Indenture Trustee a list of the names and addresses of the Senior
Noteholders (i) as of each Record Date, within five days thereafter and (ii) as
of not more than ten days prior to the time such list is furnished, within 30
days after receipt by the Owner Trustee of a written request therefor.
Section 2.12. Authenticating Agents. Upon the request of the Issuer,
the Indenture Trustee shall, and if the Indenture Trustee so chooses the
Indenture Trustee may, appoint one or more Authenticating Agents with power to
act on its behalf and subject to its direction in the authentication of Senior
Notes in connection with issuance, transfers and exchanges under Sections 2.02,
2.04, 2.05 and 9.05, as fully to all intents and purposes as though each such
Authenticating Agent had been expressly authorized by such Sections to
authenticate such Senior Notes. For all purposes of this Indenture, the
authentication of Senior Notes by an Authenticating Agent pursuant to this
Section shall be deemed to be the authentication of Senior Notes by the
Indenture Trustee.
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Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate trust business
of any Authenticating Agent, shall be the successor of such Authenticating
Agent hereunder, without the execution or filing of any further act on the part
of the parties hereto or such Authenticating Agent or such successor
corporation.
Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Indenture Trustee and the Issuer. The Indenture
Trustee may at any time terminate the agency of any Authenticating Agent by
giving written notice of termination to such Authenticating Agent and the
Issuer. Upon receiving such notice of resignation or upon such termination, the
Indenture Trustee shall promptly appoint a successor Authenticating Agent and
shall give written notice of such appointment to the Issuer.
The Indenture Trustee agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services and reimbursement for its
reasonable expenses relating thereto, and the Indenture Trustee shall be
entitled to be reimbursed for all such payments, subject to Section 6.07. The
provisions of Sections 2.07 and 6.04 shall be applicable to any Authenticating
Agent.
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ARTICLE THREE
COVENANTS
Section 3.01. Payment of Principal and Interest. The Issuer shall duly
and punctually pay the principal of and interest on the Senior Notes in
accordance with the terms of the Senior Notes and this Indenture. Without
limiting the foregoing, subject to Section 8.04, the Issuer shall cause to be
distributed all amounts on deposit in the Note Distribution Account on each
Payment Date that have been deposited therein for the benefit of the Senior
Notes as set forth in Section 8.04. Amounts properly withheld under the Code by
any Person from a payment to any Senior Noteholder of interest or principal
shall be considered to have been paid by the Issuer to such Senior Noteholder
for all purposes of this Indenture.
Section 3.02. Maintenance of Office or Agency. The Senior Note
Registrar, on behalf of the Issuer, shall maintain at the Corporate Trust
Office or at such other location in the Borough of Manhattan, The City of New
York, chosen by the Senior Note Registrar, acting for the Issuer, an office or
agency where Senior Notes may be surrendered for registration of transfer or
exchange, and where notices to and demands upon the Issuer in respect of the
Senior Notes and this Indenture may be served. The Issuer hereby appoints the
Indenture Trustee as its agent to receive all such surrenders, notices and
demands. 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. As provided in
Sections 8.04 and 5.04(b), all payments of amounts due and payable with respect
to any Senior Notes that are to be made from amounts withdrawn from the Note
Distribution Account shall be made on behalf of the Issuer by the Indenture
Trustee or by another Paying Agent, and no amounts so withdrawn therefrom for
payments on Senior Notes shall be paid over to the Issuer except as provided in
this Section.
On each Payment Date and Redemption Date, the Issuer shall deposit or
cause to be deposited into the Note Distribution Account an aggregate sum
sufficient to pay the amounts then becoming due under the Senior Notes, and the
Paying Agent shall hold such sum 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 any failure by the Issuer to effect
such deposit.
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 Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent, it hereby so agrees to the extent relevant),
subject to the provisions of this Section, that such Paying Agent shall:
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(a) hold all sums held by it for the payment of amounts due with
respect to the Senior 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;
(b) give the Indenture Trustee notice of any default by the Issuer of
which it has actual knowledge (or any other obligor upon the Senior Notes) in
the making of any payment required to be made with respect to the Senior Notes;
(c) 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;
(d) immediately resign as a Paying Agent and forthwith pay to the
Indenture Trustee all sums held by it in trust for the payment of Senior Notes
if at any time it ceases to meet the standards required to be met by a Paying
Agent at the time of its appointment; and
(e) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Senior 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 such 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 Senior Note and remaining unclaimed for two
years after such amount has become due and payable shall be discharged from
such trust and deposited by the Indenture Trustee into the 1999-A SUBI
Collection Account, and the related Senior Noteholder shall thereafter, as an
unsecured general creditor, look only to the Issuer for payment thereof, and
all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided, however, that the Indenture
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Issuer cause to be published once, in a newspaper
published in the English language, customarily published on each Business Day
and of general circulation in The City of New York, notice that such money
remains unclaimed and that, after a date specified therein, which date shall
not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining shall be paid to the Administrator. The
Indenture Trustee shall also adopt and employ, at the expense of the Issuer,
any other reasonable means of notification of such repayment (including mailing
notice of such repayment to Senior Noteholders the Senior Notes of which have
been called but not surrendered for redemption or whose right to or interest in
monies due and payable but not claimed is determinable from the records of the
Indenture Trustee or any Paying Agent at the last address of record for each
such Senior Noteholder).
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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
Delaware (unless it becomes, or any successor Issuer hereunder is or becomes,
organized under the laws of any other state or of the United States, in which
case the Issuer 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 Senior Notes, the Collateral and each other instrument or
agreement included in the Trust Estate.
Section 3.05. Protection of Trust Estate. The Issuer intends the
security interest Granted pursuant to this Indenture in favor of the Indenture
Trustee on behalf of the Senior Noteholders to be prior to all other liens in
respect of the Trust Estate, and the Issuer shall take all actions necessary to
obtain and maintain, for the benefit of the Indenture Trustee on behalf of the
Senior Noteholders, a first lien on and a first priority, perfected security
interest in the 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, all as prepared by the Administrator and delivered to the Issuer,
and shall take such other action necessary or advisable to:
(a) Grant more effectively all or any portion of the Trust Estate;
(b) maintain or preserve the lien and security interest (and the
priority thereof) created by this Indenture or carry out more effectively the
purposes hereof;
(c) perfect, publish notice of or protect the validity of any Grant
made or to be made by this Indenture;
(d) enforce any of the Collateral;
(e) preserve and defend title to the Trust Estate and the rights of
the Indenture Trustee and the Senior Noteholders in the Trust Estate against
the claims of all Persons; or
(f) pay all taxes or assessments levied or assessed upon the Trust
Estate when due. The Issuer hereby designates the Indenture Trustee its agent
and attorney-in-fact to execute all financing statements, continuation
statements or other instruments required to be executed pursuant to this
Section.
Section 3.06. Opinions as to Trust Estate.
(a) On the Closing Date, the Issuer shall furnish or cause to be
furnished to the Indenture Trustee, an Opinion of Counsel to the effect that,
in the opinion of such counsel, either (i) all financing statements and
continuation statements have been executed and filed that are necessary to
create and maintain the lien and security interest of the Indenture Trustee in
the Collateral and reciting the details of such action, or (ii) no such action
is necessary to create and maintain such lien and security interest.
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(b) On or before April 30 of each calendar year, beginning with April
30, 2000, the Issuer shall furnish to the Indenture Trustee an Opinion of
Counsel to the effect that in the opinion of such counsel, either (i) all
financing statements and continuation statements have been executed and filed
that are necessary to continue the lien and security interest of the Indenture
Trustee in the Collateral and reciting the details of such filings or referring
to prior Opinions of Counsel in which such details are given, or (ii) no such
action is necessary to continue such lien and security interest.
Section 3.07. Performance of Obligations; Administration of the 1999-A
SUBI Assets.
(a) The Issuer shall not take any action and shall use its best
efforts not to permit any action to be taken by others, including the
Administrator, 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 the Basic Documents 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 Administrator, and the Administrator has agreed,
to assist the Issuer in performing its duties under this Indenture.
(c) The Issuer shall, and, shall cause the Administrator and the
Administrative Agent to, punctually perform and observe all of its obligations
and agreements contained in this Indenture, the other Basic Documents and the
instruments and agreements included in the Trust Estate, including 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 other Basic
Documents in accordance with and within the time periods provided for herein
and therein. Except as otherwise expressly provided therein, the Issuer, as a
party to the Basic Documents and as Holder of the 99% 1999-A Vehicle SUBI
Certificate and pledgee of the 99% 1999-A Lease SUBI Certificate, shall not,
and shall cause each of the Administrative Agent and the Administrator not to,
modify, amend, supplement, waive or terminate any Basic Document or any
provision thereof without the consent of the Indenture Trustee or the Senior
Noteholders of at least a majority of the Outstanding Amount or such greater
percentage as may be specified in the particular provision or Basic Document.
(d) Administrative Agent Defaults may occur with respect to the
Indenture Trustee as assignee of the Issuer. If the Issuer or the Indenture
Trustee shall have knowledge of the occurrence of an Administrative Agent
Default, such entity shall promptly notify the other entity and each Rating
Agency thereof, and shall specify in such notice the action, if any, the action
the other entity is taking in respect of such default. If an Administrative
Agent Default shall arise from the failure of the Administrative Agent to
perform any of its duties or obligations under the Administration Agreement
with respect to the 1999-A SUBI Assets, the Issuer shall take all reasonable
steps available to it to remedy such failure. Upon the occurrence of an
Administrative Agent Default with respect to the 1999-A SUBI, the Indenture
Trustee may terminate all of the rights and obligations of the Administrative
Agent with respect to the 1999-A SUBI only, and a successor Administrative
Agent shall be appointed pursuant to the Administration Agreement.
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(e) Upon any termination of the Administrative Agent's rights and
powers or resignation of the Administrative Agent pursuant to the
Administration Agreement, the Issuer or the Indenture Trustee shall promptly,
but in any event within two Business Days of such termination or resignation,
notify the other entity thereof. As soon as a successor Administrative Agent is
appointed pursuant to the Administration Agreement, the Issuer or the Indenture
Trustee shall notify the other entity of such appointment, specifying in such
notice the name and address of such successor Administrative Agent.
Section 3.08. Negative Covenants. So long as any Senior Notes are
Outstanding, the Issuer shall not:
(a) engage in any activities other than financing, acquiring, owning,
leasing (subject to the lien of this Indenture), pledging and managing the
1999-A SUBI Certificates as contemplated by this Indenture and the other Basic
Documents;
(b) other than the lease of the 99% 1999-A Vehicle SUBI Certificate
pursuant to the Program Operating Lease, which lease is subject to the lien of
this Indenture, and except as expressly permitted herein, in the Program
Operating Lease and in the other Basic Documents, sell, transfer, exchange or
otherwise dispose of any of the assets of the Issuer;
(c) claim any credit on or make any deduction from the principal or
interest payable in respect of the Senior 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 Senior Noteholder by reason of the
payment of the taxes levied or assessed upon any part of the Trust Estate;
(d) (i) permit the validity or effectiveness of this Indenture to be
impaired, 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 under this Indenture, except as may be expressly
permitted hereby, (ii) 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, 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 1999-A SUBI Asset and arising solely as a result of an
action or omission of the related Lessee) or (iii) except as otherwise provided
in the Basic Documents, 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;
(e) incur, assume or guarantee any indebtedness other than
indebtedness incurred in accordance with the Basic Documents; or
(f) except as otherwise permitted by the Basic Documents, dissolve or
liquidate in whole or in part.
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Section 3.09. Issuer Certificates and Reports.
(a) The Issuer shall deliver to the Indenture Trustee and each Rating
Agency, within 120 days after the end of each calendar year (commencing with
the year ending December 31, 1999), 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 (or
such shorter period in the case of the first such Officer's
Certificate) and of the Issuer's performance under this
Indenture has been made under such Authorized Officer's
supervision;
(ii) to the best of such Authorized Officer's knowledge, based on
such review:
(A) all the dispositions of Collateral and cash payments out of
the Accounts described in clauses (A) and (B) of Section
11.01(b)(v) that occurred during the preceding year (or shorter
period in the case of the first such Officer's Certificate) were
made in the ordinary course of the Issuer's business and the
proceeds thereof were applied in accordance with the Basic
Documents; and
(B) the Issuer has complied with all conditions and covenants
under this Indenture throughout such year (or such shorter
period in the case of the first such Officer's Certificate), or,
if there has been a Default in the compliance of any such
condition or covenant, specifying each such Default known to
such Authorized Officer and the nature and status thereof.
(b) 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 such other information, documents and reports
(or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations
prescribe) as 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 other 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 Senior Noteholders as required by 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 3.09(b) and pursuant to rules and
regulations prescribed from time to time by the Commission.
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(c) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year.
Section 3.10. Restrictions on Certain Other Activities. Except as
otherwise provided in the Basic Documents, the Issuer shall not: (i) engage in
any activities other than financing, acquiring, owning, leasing (subject to the
lien of this Indenture), pledging and managing the 1999-A SUBI Certificates in
the manner contemplated by the Basic Documents; (ii) issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness; (iii) make any loan, advance or credit to, 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, 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; or (iv) make any expenditure (by long-term
or operating lease or otherwise) for capital assets (either realty or
personalty).
Section 3.11. Notice of Defaults. The Issuer agrees to give the
Indenture Trustee and each Rating Agency prompt written notice of each
Indenture Default hereunder on the part of the Administrator and each Program
Operating Lease Default on the part of the Transferor as lessee under the
Program Operating Lease.
Section 3.12. 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 purposes of this Indenture.
Section 3.13. Delivery of 99% 1999-A Vehicle SUBI Certificate. On the
Closing Date, the Issuer shall deliver or cause to be delivered to the
Indenture Trustee as security for its obligations hereunder, the 99% 1999-A
Vehicle SUBI Certificate and the pledged 99% 1999-A Lease SUBI Certificate. The
Indenture Trustee shall take possession of the 99% 1999-A SUBI Certificates in
New York and shall at all times during the period of this Indenture maintain
custody of the 99% 1999-A SUBI Certificates in New York.
Section 3.14. Delivery of the Subordinated Notes. Pursuant to Section
2.01 of the Issuer SUBI Certificate Transfer Agreement, the Transferor shall
pledge all payments in respect of the Subordinated Notes to the Reserve Fund as
security for the Secured Obligations and upon the issuance of the Subordinated
Notes to the Transferor, the Issuer shall deliver the Subordinated Notes
directly to the Indenture Trustee as security for its obligations hereunder.
The Indenture Trustee shall take possession of the Subordinated Notes in New
York and shall at all times during the period of the Indenture maintain custody
of the Subordinated Notes in New York.
Section 3.15. Compliance with Laws. The Issuer shall comply with the
requirements of all applicable laws, the non-compliance with which would,
individually or in the aggregate, materially and adversely affect the ability
of the Issuer to perform its obligations under the Senior Notes, this Indenture
or any other Basic Document.
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ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture. This Indenture
shall discharge with respect to the Collateral securing the Senior Notes except
as to (a) rights of registration of transfer and exchange, (b) substitution of
mutilated, destroyed, lost or stolen Senior Notes, (c) rights of Senior
Noteholders to receive payments of principal thereof and interest thereon, (d)
Sections 3.03, 3.04, 3.05, 3.08, 3.10, 3.11, 3.13 and 3.14, (e) 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 (f) the rights of Senior 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 and at the expense and on behalf of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture, when
(i) either (A) all Senior Notes theretofore authenticated and
delivered (other than (1) Senior Notes that have been mutilated,
destroyed, lost or stolen and that have been replaced or paid as
provided in Section 2.05) and (2) Senior Notes for whose payment
money has theretofore been deposited in trust or segregated and
held in trust by the Issuer and thereafter paid to the Persons
entitled thereto or discharged from such trust, as provided in
Section 3.03) have been delivered to the Indenture Trustee for
cancellation; or (B) all Senior Notes not theretofore delivered
to the Indenture Trustee for cancellation (1) have become due
and payable, (2) will become due and payable on the applicable
Senior Note Final Payment Date within one year or (3) are to be
called for redemption within one year under arrangements
satisfactory to the Indenture Trustee for the giving of notice
of redemption by the Indenture Trustee in the name, and at the
expense, of the Issuer, and the Issuer, in the case of clauses
(1), (2) or (3) 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
(that will 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 Senior Notes
(including interest and any fees due and payable to the Owner
Trustee or the Indenture Trustee) not theretofore delivered to
the Indenture Trustee for cancellation, when due, to the
applicable Senior Note Final Payment Date for each Class, or to
the Redemption Date (if Senior Notes shall have been called for
redemption pursuant to Section 10.01), as the case may be;
(ii) the Issuer has paid or caused to be paid all other sums payable
hereunder by the Issuer; and
(iii) the Issuer has delivered to the Indenture Trustee an Officer's
Certificate and an Opinion of Counsel, each meeting the
applicable requirements of Section 11.01 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 (and, in the case of an
Officer's Certificate, stating that the Rating Agency Condition
has been satisfied).
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Section 4.02. Application of Trust Money. All monies deposited with
the Indenture Trustee pursuant to Section 4.01 shall be held in trust and
applied by it, in accordance with the provisions of the Senior Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Senior Noteholders of the particular
Senior Notes for the payment or redemption of which such monies have been
deposited with the Indenture Trustee of all sums due and to become due thereon
for principal and interest. Such monies need not be segregated from other funds
except to the extent required herein or in the Administration Agreement or as
required by law.
Section 4.03. Repayment of Monies Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to the
Senior Notes, all monies then held by any Paying Agent other than the Indenture
Trustee under the provisions of this Indenture with respect to such Senior
Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to be
held and applied according to Section 3.03 and such Paying Agent shall
thereupon be released from all further liability with respect to such monies.
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ARTICLE FIVE
INDENTURE DEFAULT
Section 5.01. Indenture Defaults. Any one of the following events
(whatever the reason for such Indenture Default and whether it shall be
voluntary or involuntary or 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) shall constitute a default under this
Indenture (each, an "Indenture Default"):
(a) default in the payment of any interest on any Senior Note when the
same becomes due and payable, and such default shall continue for a period of
30 days or more;
(b) default in the payment of principal of any Senior Note at the
Senior Note Final Payment Date or the Redemption Date;
(c) the occurrence of a Program Operating Lease Default;
(d) default in the observance or performance of any covenant or
agreement of the Issuer made in this Indenture (other than a covenant or
agreement, a default in the observance or performance of which is elsewhere in
this Section specifically dealt with), or any representation or warranty of the
Issuer made in this Indenture or in any certificate or other writing delivered
pursuant hereto or in connection herewith proving to have been incorrect in any
material respect as of the time when the same shall have been made, and such
default shall continue or not be cured, or the circumstance or condition in
respect of which such misrepresentation or warranty was incorrect shall not
have been eliminated or otherwise cured, for a period of 30 days 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 Senior
Noteholders representing at least 25% of the Outstanding Amount, 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;
(e) 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
(f) 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, the consent by the Issuer to
the appointment of 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, the making by the Issuer of any general
assignment for the benefit of creditors, the failure by the Issuer generally to
pay its debts as such debts become due or the taking of action by the Issuer in
furtherance of any of the foregoing.
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The Issuer shall deliver to the Indenture Trustee, each Rating Agency
and each Senior Noteholder within five days after the occurrence thereof
written notice in the form of an Officer's Certificate of any event that with
the giving of notice and the lapse of time would become an Indenture Default
under clauses (c), (d) or (e), its status and what action the Issuer is taking
or proposes to take with respect thereto.
Subject to the provisions herein relating to the duties of the
Indenture Trustee, if an Indenture Default occurs and is continuing, the
Indenture Trustee shall be under no obligation to exercise any of the rights or
powers under this Indenture at the request or direction of any Senior
Noteholder, if the Indenture Trustee reasonably believes that it will not be
adequately indemnified against the costs, expenses and liabilities that might
be incurred by it in complying with such request. Subject to such provisions
for indemnification and certain limitations contained herein, Senior
Noteholders holding not less than a majority of the Outstanding Amount shall
have the right to direct the time, method and place of conducting any
proceeding or any remedy available to the Indenture Trustee or exercising any
trust power conferred on the Indenture Trustee, and Senior Noteholders holding
not less than a majority of the Outstanding Amount may, in certain cases, waive
any default with respect thereto, except a default in the payment of principal
or interest or a default in respect of a covenant or provision of the Indenture
that cannot be modified without the waiver or consent of all of the holders of
the Outstanding Senior Notes.
Section 5.02. Acceleration of Maturity; Waiver of Indenture Default.
If an Indenture Default should occur and be continuing, the Indenture Trustee
or Senior Noteholders representing a majority of the Outstanding Amount may
declare the principal of the Senior Notes to be immediately due and payable.
Upon such declaration, the Indenture Trustee shall promptly provide written
notice to each Rating Agency. Such declaration may be rescinded by Senior
Noteholders holding a majority of the Outstanding Amount before a judgment or
decree for payment of the amount due has been obtained by the Indenture Trustee
if (a) the Issuer has deposited with the Indenture Trustee an amount sufficient
to pay (i) all interest on and principal of the Senior Notes as if the
Indenture Default giving rise to such declaration had not occurred and (ii) all
amounts advanced by the Indenture Trustee and its costs and expenses and (b)
all Indenture Defaults (other than the nonpayment of principal of the Senior
Notes that has become due solely by such acceleration) have been cured or
waived.
At any time prior to the declaration of the acceleration of the
maturity of the Senior Notes, Senior Noteholders holding not less than a
majority of the Outstanding Amount, by written notice to the Issuer and the
Indenture Trustee, may waive such Indenture Default and its consequences,
except a default (i) in payment of principal of or interest on the Senior Notes
or (ii) in respect of any covenant or provision in this Indenture that cannot
be modified or amended without the unanimous consent of the Senior Noteholders.
No such waiver shall affect any subsequent default or impair any right
consequent thereto.
If the Senior Notes have been declared due and payable following an
Indenture Default, the Indenture Trustee may institute proceedings to collect
amounts due, exercise remedies as a secured party (including foreclosure or
sale of the Trust Estate) or elect to maintain the Trust Estate and continue to
apply the proceeds from the Trust Estate as if there had been no declaration of
acceleration. Any sale of the Trust Estate by the Indenture Trustee will be
subject to the terms and conditions of Section 5.04.
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Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.
(a) The Issuer covenants that if there is a default in the payment of
(i) any interest on the Senior Notes when the same becomes due and payable, and
such default continues for a period of five days or (ii) the principal of the
Senior Notes at the Senior Note Final Payment Date or the Redemption Date, the
Issuer shall, upon demand of the Indenture Trustee, pay to the Indenture
Trustee, for the benefit of such Senior Noteholders, the entire amount then due
and payable on such Senior 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, upon overdue installments of interest, at the
Overdue Interest Rate and in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents, attorneys and counsel.
(b) In case the Issuer shall fail forthwith to pay amounts described
in Section 5.03(a) upon 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 Senior Notes and collect in the manner provided by law out of the property
of the Issuer or other obligor upon such Senior Notes, wherever situated, the
monies adjudged or decreed to be payable.
(c) If an Indenture Default occurs and is continuing, the Indenture
Trustee may, in its discretion, proceed to protect and enforce its rights and
the rights of the Senior 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 Senior Notes or any Person having or claiming an
ownership interest in the Trust Estate, Proceedings under Title 11 of the
United States Code or any other applicable federal or state bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, sequestrator or similar official
shall have been appointed for or taken possession of the Issuer 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 Senior Notes, or
to the creditors or property of the Issuer or such other obligor, the Indenture
Trustee, irrespective of whether the principal of any Senior 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:
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(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Senior
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 and disbursements made, by the
Indenture Trustee and each predecessor Indenture Trustee, except
as a result of negligence or bad faith) and of the Senior
Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to vote on
behalf of the Senior Noteholders in any election of a trustee, a
standby trustee or Person performing similar functions in any
such Proceedings; to collect and receive any monies or other
property payable or deliverable on any such claims and to
distribute all amounts received with respect to the claims of
the Senior Noteholders and the Indenture Trustee on their
behalf; and
(iii) 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 Senior Noteholders allowed in any
judicial proceedings relative to the Issuer, its creditors and
its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each Senior Noteholder to make
payments to the Indenture Trustee and, in the event the Indenture Trustee shall
consent to the making of payments directly to such Senior Noteholders, to pay
to the Indenture Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Indenture Trustee, each predecessor Indenture
Trustee and their respective agents, attorneys and counsel, and all other
expenses and liabilities incurred and all advances and disbursements made by
the Indenture Trustee and each predecessor Indenture Trustee except as a result
of negligence or bad faith, and any other amounts due the Indenture Trustee
under Section 6.07.
(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 Senior Noteholder any plan of reorganization, arrangement,
adjustment or composition affecting the Senior Notes or the rights of any
Senior Noteholder or to vote in respect of the claim of any Senior Noteholder
in any such proceeding except, as aforesaid, to vote for the election of a
trustee in bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this Indenture,
or under the Senior Notes, may be enforced by the Indenture Trustee without the
possession of the Senior 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,
advances, disbursements and compensation of the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents, attorneys and
counsel shall be for the ratable benefit of the Senior Noteholders in respect
of which such judgment has been recovered.
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(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 Senior Noteholders, and it shall not be necessary to
make any Senior Noteholder a party to any such Proceedings.
Section 5.04. Remedies; Priorities.
(a) If an Indenture Default shall have occurred and be continuing, the
Indenture Trustee may do one or more of the following (subject to Sections 5.02
and 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 Senior 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 Senior Notes monies 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 Senior
Noteholders; and
(iv) subject to Section 5.17, after an acceleration of the maturity
of the Senior Notes pursuant to Section 5.02, 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 unless directed to sell the Trust Estate in accordance
with Section 9.02 of the Trust Agreement, the Indenture Trustee may not sell or
otherwise liquidate the Trust Estate following an Indenture Default, other than
an Indenture Default described in Section 5.01 (a) or (b), unless (A) Senior
Noteholders holding 100% of the Outstanding Amount consent thereto, (B) the
proceeds of such sale are sufficient to discharge in full all amounts then due
and unpaid upon all outstanding Securities (other than Transferor Trust
Certificate) or (C) the Indenture Trustee determines that the Trust Estate will
not continue to provide sufficient funds for the payment of principal of and
interest on the Senior Notes as they would have become due if the Senior Notes
had not been declared due and payable and the Indenture Trustee obtains the
consent of Senior Noteholders holding not less than 66?% of the Outstanding
Amount; and provided further, that the Indenture Trustee may not sell the Trust
Estate, other than a sale resulting from the bankruptcy, insolvency or
termination of the Transferor pursuant to Section 9.02 of the Trust Agreement,
unless it shall first have obtained an Opinion of Counsel that such sale will
not cause the Origination Trust or an interest therein or portion thereof to be
classified as an association (or a publicly traded partnership) taxable as a
corporation for federal income tax purposes. In determining such sufficiency or
insufficiency with respect to clauses (B) and (C) of the preceding sentence,
the Indenture Trustee may but need not obtain (at the expense of the Issuer)
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.
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(b) If the Indenture Trustee collects any money or property pursuant
to this Article Five upon sale of the Trust Estate, it shall pay out such money
or property held as Collateral (including available monies on deposit in the
Reserve Fund) and deposited in the Note Distribution Account pursuant to
Section 12.05(b) of the SUBI Trust Agreement after giving effect to the
distributions set forth in Section 12.05(b) of the SUBI Trust Agreement, for
the benefit of the Securityholders in the following order:
(i) to Senior Noteholders for the payments of interest which is due
and unpaid on the Senior Notes (including any overdue interest,
and to the extent permitted under applicable law, interest on
any overdue interest at the Overdue Interest Rate) in respect of
which or for the benefit of which such money has been collected;
(ii) to the Subordinated Noteholder (which amounts shall be deposited
into the Reserve Fund), for the payment of interest that is due
and unpaid (including any overdue interest and, to the extent
permitted under applicable law, interest on any overdue interest
at the Subordinated Note Rate) on the Subordinated Notes;
(iii) to the Certificate Distribution Account for the payment of
interest which is due and unpaid (including any overdue interest
and, to the extent permitted under applicable law, interest on
any overdue interest at the Certificate Rate) on the
Certificates;
(iv) to the Senior Noteholders in payment of the principal amount due
and unpaid on the Senior Notes;
(v) to the Subordinated Noteholder (which amounts shall be deposited
into the Reserve Fund) and to the Certificate Distribution
Account for distribution to the Trust Certificateholders, for
amounts due and unpaid in respect of the principal amount due
and unpaid on the Subordinated Notes and the Trust Certificates,
respectively, ratably, without preference or priority of any
kind, according to the amounts due and payable to the
Subordinated Noteholder and the Trust Certificateholders;
(vi) to the Transferor, in its capacity as the Subordinated
Noteholder, up to the amount deposited into the Reserve Fund in
respect of the Subordinated Notes on or prior to the date of the
preceding distributions; and
(vii) any remaining amounts, shall be paid to the Transferor.
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(c) The Indenture Trustee may fix a record date and payment date for
any payment to Senior Noteholders pursuant to this Section. At least 15 days
before such record date, the Issuer shall mail to each Senior 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 1999-A SUBI Assets. If the
Senior Notes have been declared to be due and payable under Section 5.02
following an Indenture Default and such declaration and its consequences have
not been rescinded and annulled, the Indenture Trustee may, unless directed to
sell pursuant to Section 9.02 of the Trust Agreement, but need not, elect to
maintain possession of the Trust Estate and continue to apply the proceeds
thereof in accordance with Section 3.01 and 8.04. It is the intent of the
parties hereto and the Senior Noteholders that there be at all times sufficient
funds for the payment of principal of and interest on the Senior Notes, and the
Indenture Trustee shall take such intent 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 expense of the Issuer) 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. Notwithstanding the foregoing provisions of this
Section and Section 5.04, the Indenture Trustee shall sell the Trust Estate if
so instructed by the Owner Trustee pursuant to Section 9.02 of the Trust
Agreement, and the proceeds of such sale distributed in accordance with Section
12.05(b) of the SUBI Trust Agreement.
Section 5.06. Limitation of Suits.
(a) No holder of any Senior 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 Senior Noteholder previously has given to the Indenture
Trustee written notice of a continuing Indenture Default, (ii) Senior
Noteholders holding not less than 25% of the Outstanding Amount have made
written request to the Indenture Trustee to institute such Proceeding in
respect of such Indenture Default in its own name as Indenture Trustee, (iii)
such Senior Noteholder has offered the Indenture Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in complying with
such request, (iv) the Indenture Trustee has for 60 days failed to institute
such Proceedings and (v) no direction inconsistent with such written request
has been given to the Indenture Trustee during such 60 day period by Senior
Noteholders holding a majority of the Outstanding Amount.
No Senior Noteholder or group of Senior Noteholders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Senior
Noteholders or to obtain or to seek to obtain priority or preference over any
other Senior Noteholder 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 Senior
Noteholders, each representing less than a majority of the Outstanding Amount,
the Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provisions of this Indenture.
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(b) No Senior Noteholder shall have any right to vote except as
provided pursuant to this Indenture and the Senior Notes, nor any right in any
manner to otherwise control the operation and management of the Issuer.
However, in connection with any action as to which Senior Noteholders are
entitled to vote or consent under this Indenture and the Senior Notes, the
Issuer may set a record date for purposes of determining the identity of
Noteholders entitled to vote or consent in accordance with TIA Section 316(c).
Section 5.07. Unconditional Rights of Senior Noteholders to Receive
Principal and Interest. Notwithstanding any other provision in this Indenture,
any Senior Noteholder shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest on, if any,
such Senior Note on or after the respective due dates thereof expressed in such
Senior Note or 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 Senior
Noteholder.
Section 5.08. Restoration of Rights and Remedies. If the Indenture
Trustee or any Senior 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 such Senior Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Senior 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 Senior 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 the Senior
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, 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 Senior Noteholder to exercise any right or remedy
accruing upon any Default or Indenture Default shall impair any such right or
remedy or constitute a waiver of any such Default or Indenture Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Indenture Trustee or the Senior Noteholders may be exercised from time to
time, and as often as may be deemed expedient, by the Indenture Trustee or by
the Senior Noteholders, as the case may be.
Section 5.11. Control by Senior Noteholders. Subject to the provisions
of Sections 5.06, 6.02(d) and 6.02(e), Senior Noteholders holding not less than
a majority of the Outstanding Amount 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 Senior Notes or with respect to the
exercise of any trust or power conferred on the Indenture Trustee, provided
that:
(a) such direction shall not be in conflict with any rule of law or
this Indenture;
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(b) subject to Section 5.04, any direction to the Indenture Trustee
to, sell or liquidate the Trust Estate shall be made by Senior Noteholders
holding not less than 100% of the Outstanding Amount;
(c) 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, and except in the case of a sale of the Trust Estate pursuant to
Section 9.02 of the Trust Agreement, then any direction to the Indenture
Trustee by Senior Noteholders holding less than 100% of the Outstanding Amount
to sell or liquidate the Trust Estate shall be of no force and effect; and
(d) 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 Senior Noteholders set forth in this
Section, subject to Section 6.01, the Indenture Trustee need not take any
action it determines might expose it to personal liability or might materially
adversely affect or unduly prejudice the rights of any Senior Noteholders not
consenting to such action.
Section 5.12. Waiver of Past Defaults. Prior to the acceleration of
the maturity of the Senior Notes as provided in Section 5.02, Senior
Noteholders holding not less than a majority of the Outstanding Amount may
waive any past Indenture Default and its consequences except an Indenture
Default (i) in payment of principal of or interest on the Senior Notes or (ii)
in respect of a covenant or provision hereof that cannot be modified or amended
without the consent of each Senior Noteholder. In the case of any such waiver,
the Issuer, the Indenture Trustee and the Senior Noteholders shall be restored
to their former positions and rights hereunder, respectively, but no such
waiver shall extend to any subsequent or other Indenture Default or impair any
right consequent thereto.
Upon any such waiver, such Indenture Default shall cease to exist and
be deemed to have been cured and not to have occurred, and any Indenture
Default arising therefrom shall be deemed to have been cured and not to have
occurred for every purpose of this Indenture, but no such waiver shall extend
to any subsequent or other Indenture Default or impair any right consequent
thereto.
Section 5.13. Undertaking for Costs. All parties to this Indenture
agree, and each Senior Noteholder by such Senior Noteholder's acceptance
thereof shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Indenture Trustee for any action taken,
suffered or omitted by it as Indenture Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
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 (i) any suit
instituted by the Indenture Trustee, (ii) any suit instituted by any Senior
Noteholder or group of Senior Noteholders, in each case holding in the
aggregate more than 10% of the Outstanding Amount or (iii) any suit instituted
by any Senior Noteholder for the enforcement of the payment of principal of or
interest on any Senior Note on or after the related due dates expressed in such
Senior Note and in this Indenture (or, in the case of redemption, on or after
the Redemption Date).
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Section 5.14. Waiver of Stay or Extension Laws. The Issuer covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in any manner whatsoever, claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture, and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that
it will not hinder, delay or impede the execution of any power herein granted
to the Indenture Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.
Section 5.15. Action on Senior Notes. The Indenture Trustee's right to
seek and recover judgment on the Senior 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 Senior 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) 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 the Transferor
and the Administrative Agent, as applicable, of each of their obligations to
the Issuer under or in connection with the Program Operating Lease and the
Administration Agreement, respectively, in accordance with the terms thereof,
and to exercise any and all rights, remedies, powers and privileges lawfully
available to the Issuer under or in connection with each such agreement to the
extent and in the manner directed by the Indenture Trustee, including the
transmission of notices of default on the part of the Administrative Agent
thereunder and the institution of legal or administrative actions or
proceedings to compel or secure performance by the Administrative Agent of its
obligations under the Administration Agreement. Upon the occurrence of a
Program Operating Lease Default, the Indenture Trustee, as assignee of the
rights of the Issuer in the Program Operating Lease pursuant to the Indenture
Trustee's security interest in the Trust Estate, shall be entitled to terminate
the Program Operating Lease. Upon such termination, the Issuer shall directly
receive all distributions with respect to, or shall have the right to sell, the
99% 1999-A Vehicle SUBI Certificate and to apply the funds received in respect
thereof to pay interest on and principal of the Securities.
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(b) If an Indenture 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 Senior
Noteholders holding not less than a majority of the Outstanding Amount, shall,
exercise all rights, remedies, powers, privileges and claims of the Issuer
against the Transferor, the Origination Trustee and the Administrative Agent
under or in connection with the Program Operating Lease, the Administration
Agreement and the Administration Supplement, respectively, including the right
or power to take any action to compel or secure performance or observance by
the Administrative Agent of its obligations to the Issuer thereunder and to
give any consent, request, notice, direction, approval, extension or waiver
under the Administration Agreement, and any right of the Issuer to take such
action shall be suspended.
Section 5.17. Sale of Trust Estate. If the Indenture Trustee acts to
sell the Trust Estate or any part thereof, pursuant to Section 5.04(a), the
Indenture Trustee shall publish a notice in an Authorized Newspaper stating
that the Indenture Trustee intends to effect such a sale in a commercially
reasonable manner and on commercially reasonable terms, which shall include the
solicitation of competitive bids. Following such publication, the Indenture
Trustee shall, unless otherwise prohibited by applicable law from any such
action, sell the Trust Estate or any part thereof, in such manner and on such
terms as provided above to the highest bidder, provided, however, that the
Indenture Trustee may from time to time postpone any sale by public
announcement made at the time and place of such sale. The Indenture Trustee
shall give notice to the Transferor and Administrative Agent of any proposed
sale, and the Transferor and Administrative Agent shall be permitted to bid for
the Trust Estate at any such sale. The Indenture Trustee may obtain a prior
determination from a conservator, receiver or trustee in bankruptcy of the
Issuer that the terms and manner of any proposed sale are commercially
reasonable. The power to effect any sale of any portion of the Trust Estate
pursuant to Section 5.04 and this Section 5.17 shall not be exhausted by any
one or more sales as to any portion of the Trust Estate remaining unsold, but
shall continue unimpaired until the entire Trust Estate shall has been sold or
all amounts payable on the Senior Notes shall have been paid.
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ARTICLE SIX
THE INDENTURE TRUSTEE
Section 6.01. Duties of Indenture Trustee.
(a) If an Indenture Default has occurred and is continuing, the
Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and in 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 Indenture Default:
(i) the Indenture Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and
no implied covenants or obligations shall be read into this
Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the Indenture Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates
or opinions furnished to the Indenture Trustee and conforming to
the requirements of this Indenture; however, the Indenture
Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this
Indenture and the other Basic Documents to which the Indenture
Trustee is a party.
(c) The Indenture Trustee shall 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);
(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.
(d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to paragraphs (a), (b) and (c).
(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.
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(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 Administration Agreement.
(g) No provision of this Indenture shall require the Indenture Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that
repayments of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section.
(i) The Indenture Trustee shall not be deemed to have knowledge of any
Indenture Default or other event unless a Responsible Officer has actual
knowledge thereof or has received written notice thereof in accordance with the
provisions of this Indenture.
(j) Nothing contained herein shall be deemed to authorize the
Indenture Trustee to engage in any business operations or any activities other
than those set forth in this Indenture. Specifically, the Indenture Trustee
shall have no authority to engage in any business operations, acquire any
assets other than those specifically included in the Trust Estate under this
Indenture or otherwise vary the assets held by the Issuer. Similarly, the
Indenture Trustee shall have no discretionary duties other than performing
those ministerial acts set forth above necessary to accomplish the purpose of
the Issuer as set forth in this Indenture.
Section 6.02. Rights of Indenture Trustee.
(a) Except as provided by the second succeeding sentence, the
Indenture Trustee may conclusively rely and shall be protected in acting upon
or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, note, direction,
demand, election or other paper or document believed by it to be genuine and to
have been signed or presented by the proper person. The Indenture Trustee need
not investigate any fact or matter stated in the document. Notwithstanding the
foregoing, the Indenture Trustee, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Indenture Trustee that shall be specifically
required to be furnished pursuant to any provision of this Indenture, shall
examine them to determine whether they comply as to form to the requirements of
this Indenture.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate (with respect to factual matters) or an
Opinion of Counsel, as applicable. The Indenture Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on such
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, the Administrator, any co-trustee or separate trustee appointed
in accordance with the provisions of Section 6.10 or any other 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 that it believes to be authorized or within its
rights or powers; provided, however, that the Indenture Trustee's conduct does
not constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice of
such counsel or any Opinion of Counsel with respect to legal matters relating
to this Indenture and the Senior 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 or to institute, conduct
or defend any litigation under this Indenture or in relation to this Indenture
or to honor the request or direction of any of the Senior Noteholders pursuant
to this Indenture unless such Senior Noteholders shall have offered to the
Indenture Trustee reasonable security or indemnity against the reasonable
costs, expenses, disbursements, advances and liabilities that might be incurred
by it, its agents and its counsel in compliance with such request or direction;
provided, however, that the Indenture Trustee shall, upon the occurrence of an
Event of Default (that has not been cured), exercise the rights and powers
vested in it by this Indenture with reasonable care and skill.
(g) The Indenture Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing to do so by the holders of
Senior Notes evidencing not less than 25% of the Outstanding Amount; provided,
however, that if the payment within a reasonable time to the Indenture Trustee
of the costs, expenses or liabilities likely to be incurred by it in the making
of such investigation is, in the opinion of the Indenture Trustee, not
reasonably assured to the Indenture Trustee by the security afforded to it by
the terms of this Indenture, the Indenture Trustee may require reasonable
indemnity against such cost, expense or liability as a condition to so
proceeding. The reasonable expense of each such investigation shall be paid by
the Person making such request, or, if paid by the Indenture Trustee, shall be
reimbursed by the Person making such request upon demand.
(h) Any request or direction of the Issuer mentioned herein shall be
sufficiently evidenced by an Issuer Request.
(i) The Indenture Trustee shall, for so long as any Senior Notes are
outstanding, be entitled to exercise all of the rights and powers of a
Beneficiary under the Basic Documents.
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 Senior Notes and may otherwise deal with the Issuer or its Affiliates with
the same rights it would have if it were not Indenture Trustee. Any Paying
Agent, Senior Note Registrar, co-registrar, co-paying agent, co-trustee or
separate trustee may do the same with like rights. The Indenture Trustee must,
however, comply with Section 6.11.
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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 Trust Estate or the Senior Notes, shall not be
accountable for the Issuer's use of the proceeds from the Senior Notes and
shall not be responsible for any statement in the Indenture or in any document
issued in connection with the sale of the Senior Notes or in the Senior Notes,
all of which shall be taken as the statements of the Issuer, other than the
Indenture Trustee's certificate of authentication.
Section 6.05. Notice of Defaults. If a Default occurs and is
continuing, and if it is known to a Responsible Officer of the Indenture
Trustee, the Indenture Trustee shall mail to each Senior Noteholder and each
Rating Agency notice of such Indenture Default within 90 days after it occurs.
Except in the case of a Default with respect to payment of principal of or
interest on any Senior Note (including payments pursuant to the redemption of
Senior Notes), the Indenture Trustee may withhold such notice if and so long as
a committee of its Responsible Officers in good faith determines that
withholding such notice is in the interests of the Senior Noteholders;
provided, however, that in the case of any Indenture Default of the character
specified in Section 5.01(e), no such notice shall be given until at least 30
days after the occurrence thereof.
Section 6.06. Reports by Indenture Trustee to Senior Noteholders. The
Indenture Trustee, at the expense of the Issuer, shall deliver to each Senior
Noteholder, not later than the latest date permitted by law, such information
as may be reasonably requested (and reasonably available to the Indenture
Trustee) to enable such holder to prepare its federal and state income tax
returns.
Section 6.07. Compensation and Indemnity. The Administrative Agent
shall, or shall cause the Administrator to, (i) pay to the Indenture Trustee
from time to time reasonable compensation for its services, (ii) reimburse the
Indenture Trustee for all reasonable expenses, advances and disbursements
reasonably incurred and (iii) indemnify the Indenture Trustee for, and hold it
harmless against, any and all loss, liability or expense (including reasonable
attorneys' fees) incurred by it in connection with the administration of the
Trust or the performance of its duties. The Indenture Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Indenture Trustee shall notify the Issuer and the Administrator
promptly of any claim for which it may seek indemnity. Failure by the Indenture
Trustee to so notify the Issuer and the Administrator shall not relieve the
Issuer or the Administrator of its obligations hereunder. The Issuer shall, or
shall cause the Administrator to, defend any such claim, and the Indenture
Trustee may have separate counsel and the Issuer shall, or shall cause the
Administrator to, pay the fees and expenses of such counsel. The Indenture
Trustee shall not be indemnified by the Administrative Agent against any loss,
liability or expense incurred by it through its own willful misconduct,
negligence or bad faith, except that the Indenture Trustee shall not be liable
(i) for any error of judgment made by it in good faith unless it is proved that
the Indenture Trustee was negligent in ascertaining the pertinent facts, (ii)
with respect to any action it takes or omits to take in good faith in
accordance with a direction received by it from the Senior Noteholders in
accordance with the terms of this Indenture and (iii) for interest on any money
received by it except as the Indenture Trustee and the Issuer may agree in
writing. The Indenture Trustee shall not be deemed to have knowledge of any
event unless an officer of the Indenture Trustee has actual knowledge thereof
or has received written notice thereof.
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The Issuer's payment obligations to the Indenture Trustee pursuant to
this Section shall survive the discharge of this Indenture. When the Indenture
Trustee incurs expenses after the occurrence of a Default set forth in Section
5.01(e) or (f) with respect to the Issuer, the expenses are intended to
constitute expenses of administration under Title 11 of the United States Code
or any other applicable federal or state bankruptcy, insolvency or similar law.
Section 6.08. Replacement of Indenture Trustee. Senior Noteholders
holding not less than a majority of the Outstanding Amount may remove the
Indenture Trustee without cause by so notifying the Indenture Trustee and the
Issuer, and following such removal may appoint a successor Indenture Trustee.
The Issuer shall give prompt written notice to each Rating Agency of such
removal. The Indenture Trustee may resign at any time by so notifying the
Issuer, the Administrative Agent and each Rating Agency. The Issuer shall
remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) a court having jurisdiction in the premises in respect of the
Indenture Trustee in an involuntary case or proceeding under
federal or state banking or bankruptcy laws, as now or hereafter
constituted, or any other applicable federal or state
bankruptcy, insolvency or other similar law, shall have entered
a decree or order granting relief or appointing a receiver,
liquidator, assignee, custodian, trustee, conservator,
sequestrator (or similar official) for the Indenture Trustee or
for any substantial part of the Indenture Trustee's property, or
ordering the winding-up or liquidation of the Indenture
Trustee's affairs, provided any such decree or order shall have
continued unstayed and in effect for a period of 30 consecutive
days;
(iii) the Indenture Trustee commences a voluntary case under any
federal or state banking or bankruptcy laws, as now or hereafter
constituted, or any other applicable federal or state
bankruptcy, insolvency or other similar law, or consents to the
appointment of or taking possession by a receiver, liquidator,
assignee, custodian, trustee, conservator, sequestrator or other
similar official for the Indenture Trustee or for any
substantial part of the Indenture Trustee's property, or makes
any assignment for the benefit of creditors or fails generally
to pay its debts as such debts become due or takes any corporate
action in furtherance of any of the foregoing; or
(iv) the Indenture Trustee otherwise becomes incapable of acting.
Upon the resignation or required removal of the Indenture Trustee, or
the failure of the Senior Noteholders to appoint a successor Indenture Trustee
following the removal without cause of the Indenture Trustee (the Indenture
Trustee in any such event being referred to herein as the retiring Indenture
Trustee), the Issuer shall be required promptly to appoint a successor
Indenture Trustee. Any successor Indenture Trustee must at all times have a
combined capital and surplus of at least $50,000,000, a long-term debt rating
of "A" or better by or is otherwise acceptable to, each Rating Agency and
satisfy the requirements of Section 310(a) of the TIA. Additionally, prior to
the appointment of any successor Indenture Trustee, the Rating Agency Condition
must be satisfied with respect to such successor Indenture Trustee.
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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, without any further act, deed or
conveyance, shall have all the rights, powers and duties of the Indenture
Trustee under this Indenture, subject to satisfaction of the Rating Agency
Condition. The successor Indenture Trustee shall mail a notice of its
succession to Senior Noteholders. The retiring Indenture Trustee shall promptly
transfer all property held by it as Indenture Trustee to the successor
Indenture Trustee.
If a successor Indenture Trustee does not take office within 45 days
after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or Senior Noteholders holding not less than a
majority of the Outstanding Amount 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 Senior
Noteholder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.
Any resignation or removal of the Indenture Trustee and appointment of
a successor Indenture Trustee pursuant to any of the provisions of this Section
shall not become effective until acceptance of appointment by the successor
Indenture Trustee pursuant to this Section and payment of all fees and expenses
owed to the outgoing Indenture Trustee. Notwithstanding the replacement of the
Indenture Trustee pursuant to this Section, the retiring Indenture Trustee
shall be entitled to payment or reimbursement of such amounts as such Person is
entitled pursuant to Section 6.07.
Section 6.09. Successor Indenture Trustee by Merger. 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 depository institution the resulting, surviving or transferee corporation,
without any further act, shall be the successor Indenture Trustee; provided,
that such corporation or depository institution shall be otherwise qualified
and eligible under Section 6.11. The Indenture Trustee shall provide each
Rating Agency prior written notice of any such transaction.
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, the Senior Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the
certificate of authentication of any predecessor trustee and deliver such
Senior Notes so authenticated, and in case at that time the Senior Notes shall
not have been authenticated, any successor to the Indenture Trustee may
authenticate such Senior 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 that it is anywhere in the Senior
Notes or in this Indenture provided that the certificate of the Indenture
Trustee shall have.
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Section 6.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Trust Estate may at the time be located, the Indenture
Trustee and the Administrator acting jointly 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 Collateral, and to vest in such Person or Persons, in such
capacity and for the benefit of the Senior 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
and the Administrator may consider necessary or desirable. If the Administrator
shall not have joined in such appointment within 15 days after it received a
request that it so join, the Indenture Trustee alone shall have the power to
make such appointment. 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 Senior Noteholders of the appointment of any co-trustee
or separate trustee shall be required under Section 6.08.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or imposed
upon the Indenture Trustee shall be conferred or imposed upon
and exercised or performed by the Indenture Trustee and such
separate trustee or co-trustee jointly (it being intended 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 Collateral or
any portion thereof in any such jurisdiction) shall be exercised
and performed singly by such separate trustee or co-trustee, but
solely at the direction of the Indenture Trustee;
(ii) no separate trustee or co-trustee hereunder shall be personally
liable by reason of any act or omission of any other trustee
hereunder; and
(iii) the Indenture Trustee and the Administrator may at any time
accept the resignation of or remove any separate trustee or
co-trustee.
(c) Any notice, request or other writing given to the Indenture
Trustee shall be deemed to have been given to each of the then-separate
trustees and co-trustees, as effectively as if given to each of them. Every
instrument appointing any separate trustee or co-trustee shall refer to this
Indenture and the conditions of this Article. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Indenture Trustee or separately, as may be provided therein,
subject to all the provisions of this Indenture and 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 and a copy thereof given
to the Administrator.
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(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee, its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect
of this Indenture on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, then
all of its estates, properties, rights, remedies and trusts shall vest in and
be exercised by the Indenture Trustee to the extent permitted by law, without
the appointment of a new or successor trustee. Notwithstanding anything to the
contrary in this Indenture, the appointment of any separate trustee or
co-trustee shall not relieve the Indenture Trustee of its obligations and
duties under this Indenture.
Section 6.11. Eligibility; Disqualification. The Indenture Trustee
shall at all times satisfy the requirements of Section 310(a) of the TIA and
shall in addition 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 a
long-term debt rating of "A" or better by, or be otherwise acceptable to, each
Rating Agency. The Indenture Trustee shall satisfy the requirements of Section
310(b) of the TIA. The Transferor, the Administrator, the Administrative Agent
and their respective Affiliates may maintain normal commercial banking
relationships with the Indenture Trustee and its Affiliates, but neither the
Issuer nor any Affiliate of the Issuer may serve as Indenture Trustee.
Section 6.12. Trustee as Holder of 99% 1999-A Vehicle SUBI
Certificate. So long as any Senior Notes are Outstanding, to the extent that
the Owner Trustee or Issuer has rights as a Holder of the 99% 1999-A Vehicle
SUBI Certificate, including rights to distributions and notice, or is entitled
to consent to any actions taken by the Transferor, the Owner Trustee or Issuer
may initiate such action or grant such consent only with consent of the
Indenture Trustee. To the extent that the Indenture Trustee has rights as a
Holder of the 99% 1999-A Vehicle SUBI Certificate or has the right to consent
or withhold consent with respect to actions taken by the Transferor, the Owner
Trustee or Issuer, such rights shall be exercised or consent granted (or
withheld) upon the written direction of holders of a majority of the
Outstanding Amount; provided, however, that subject to Section 3.07, any
direction to the Indenture Trustee to remove or replace the Administrative
Agent or Maintenance Provider upon an Administrative Agent Default or a
Maintenance Provider Default, as the case may be, shall be made by Senior
Noteholders holding not less than 66?% of the Outstanding Amount and with
respect to Section 11.15, such direction shall require the written direction of
Senior Noteholders holding 100% of the Outstanding Amount.
Section 6.13. Representations and Warranties of Indenture Trustee. The
Indenture Trustee hereby makes the following representations and warranties on
which the Issuer and Senior Noteholders shall rely:
(i) the Indenture Trustee is a national banking association duly
organized, validly existing and in good standing under the laws
of the United States; and
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(ii) the Indenture Trustee has full power, authority and legal right
to execute, deliver, and, perform this Indenture and shall have
taken all necessary action to authorize the execution, delivery
and performance by it of this Indenture.
Section 6.14. Furnishing of Documents. The Indenture Trustee shall
furnish to any Senior Noteholder promptly upon receipt of a written request by
such Senior Noteholder (at the expense of the requesting Senior Noteholder)
therefor, duplicates or copies of all reports, notices, requests, demands,
certificates and any other instruments furnished to the Indenture Trustee under
the Basic Documents.
Section 6.15. Preferential Collection of Claims Against the Issuer.
The Indenture Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). Any 1999-A Indenture
Trustee who has resigned or been removed shall be subject to TIA Section 311(a)
to the extent indicated therein.
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ARTICLE SEVEN
SENIOR NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. Issuer to Furnish Indenture Trustee Senior Noteholder
Names and Addresses. The Issuer shall furnish or cause to be furnished to the
Indenture Trustee (i) 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 Senior Noteholders as of such Record Date and (ii) 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 ten days prior to the time such list is
furnished; provided, however, that so long as the Indenture Trustee is the
Senior Note Registrar or the Senior Notes are issued as Book-Entry Notes, no
such list shall be required to be furnished to the Indenture Trustee.
Section 7.02. Preservation of Information; Communications to Senior
Noteholders.
(a) The Indenture Trustee shall preserve in as current a form as is
reasonably practicable the names and addresses of the Senior Noteholders
contained in the most recent list furnished to the Indenture Trustee as
provided in Section 7.01 and the names and addresses of Senior Noteholders
received by the Indenture Trustee in its capacity as Senior Note Registrar. The
Indenture Trustee may destroy any list furnished to it as provided in Section
7.01 upon receipt of a new list so furnished.
(b) The Senior Noteholders may communicate pursuant to TIA Section
312(b) with other Senior Noteholders regarding their rights under this
Indenture or under the Senior Notes.
(c) The Issuer, the Indenture Trustee and the Senior Note Registrar
shall have the protection of TIA Section 312(c).
Section 7.03. Reports by Indenture Trustee. If required by TIA ss.
313(a), within 60 days after each [_______] 15, beginning with [_______] 15,
2000, the Indenture Trustee shall mail to each Senior Noteholder as required by
TIA ss. 313(c) a brief report dated as of such date that complies with TIA ss.
313(a). The Indenture Trustee also shall comply with TIA ss. 313(b). A copy of
each such report, at the time of its mailing to the Senior Noteholders, shall
also be filed by the Indenture Trustee with the Commission.
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ARTICLE EIGHT
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 an Indenture Default
under this Indenture and any right to proceed thereafter as provided in Article
Five.
Section 8.02. Accounts.
(a) Pursuant to Section 5.01 of the Trust Agreement, there has been
established and there shall be maintained an Eligible Account (initially at
U.S. Bank National Association) in the name of the Indenture Trustee until the
Outstanding Amount is reduced to zero, and thereafter, in the name of the Owner
Trustee, which is designated as the "Reserve Fund." The Reserve Fund shall be
held for the benefit of the Securityholders, and shall bear a designation
clearly indicating that the funds on deposit therein are held for the benefit
of the Securityholders. The Reserve Fund shall be under the sole dominion and
control of the Indenture Trustee until the Outstanding Amount has been reduced
to zero, and thereafter under the sole dominion and control of the Owner
Trustee.
(b) The Transferor shall, prior to the Closing Date, establish and
maintain an Eligible Account in the name of the Indenture Trustee on behalf of
the Senior Noteholders, which shall be designated as the "Note Distribution
Account". The Note Distribution Account shall be held in trust for the benefit
of the Senior Noteholders. The Note Distribution Account shall be under the
sole dominion and control of the Indenture Trustee.
(c) All monies deposited from time to time in the Accounts pursuant to
this Indenture or the Administration Supplement shall be held by the Indenture
Trustee as part of the Collateral and shall be applied to the purposes herein
provided. If any Account shall cease to be an Eligible Account, the Indenture
Trustee, until the Outstanding Amount has been reduced to zero, and thereafter
with respect to the Reserve Fund, the Owner Trustee shall, as necessary, assist
the Administrative Agent in causing each Account to be moved to an institution
at which it shall be an Eligible Account.
Section 8.03. Payment Date Certificate.
(a) On the second Business Day preceding each Payment Date prior to
11:00 a.m., New York City time, the Issuer shall cause the Administrative
Agent, to deliver to the Indenture Trustee, the Owner Trustee and each Paying
Agent hereunder or under the Trust Agreement, a certificate (the "Payment Date
Certificate") including, among other things, the following information with
respect to such Payment Date and the related Collection Period and Accrual
Period:
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(i) SUBI Collections for such Collection Period and the amounts
allocable to the 99% interest represented by the 99% 1999-A SUBI
Certificates and the 1% interest represented by the 1% 1999-A
SUBI Certificates;
(ii) Available Funds, including amounts with respect to each of items
(i) through (iv) of the definition thereof;
(iii) the amount of interest accrued during such Accrual Period on
each Class of the Senior Notes;
(iv) the amount of interest accrued during such Accrual Period on the
Subordinated Notes;
(v) the amount of interest accrued during such Accrual Period on the
Certificate Balance (stated separately for the Transferor Trust
Certificate);
(vi) Class A-1 Note Balance, the Class A-2 Note Balance, the Class
A-3 Note Balance, the Class A-4 Note Balance, the Outstanding
Amount (as defined in the Trust Agreement) of the Subordinated
Notes and the Certificate Balance, in each case on the day
immediately preceding such Payment Date;
(vii) the aggregate amount of SUBI Collections deposited into the Note
Distribution Account and the Certificate Distribution Account,
respectively;
(viii) (A) the amount on deposit in the Reserve Fund and the Reserve
Fund Requirement, each as of the beginning and end of the
related Collection Period and as of the previous Payment Date,
(B) the Reserve Fund Deposit Amount, if any, (C) the Reserve
Fund Draw Amount, if any, (D) the balance on deposit in the
Reserve Fund on such Payment Date after giving effect to
withdrawals therefrom and deposits thereto in respect of such
Payment Date and (E) the change in such balance from the
immediately preceding Payment Date;
(ix) the Senior Note Distribution Amount for each Class of the Senior
Notes, the Certificate Distribution Amount and the amount
allocable to interest for each;
(x) the Quarterly Principal Distributable Amount, the Optimal
Principal Distributable Amount and any Principal Shortfall
Amount for each Class of the Senior Notes, the Subordinated
Notes and the Trust Certificates;
(xi) the Note Factor and Certificate Factor for each Class of the
Senior Notes and the Trust Certificates (other than the
Transferor Trust Certificate), respectively;
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(xii) the aggregate amount of Residual Value Losses and Residual Value
Surplus for such Collection Period, the amount on deposit in the
Residual Value Surplus Account and the Residual Value Surplus
Draw Amount, if any, included in Available Funds (after giving
effect to the distribution of the Retained Certificate
Distribution Amount);
(xiii) the amount of Special Event Purchases made during such
Collection Period and the aggregate Securitization Values as of
the Cutoff Date of all Specified Leases relating to Special
Event Purchases made during the related calendar year or since
the Closing Date;
(xiv) the amount of Sales Proceeds Advances and Financial Component
Advances included in Available Funds;
(xv) any Payment Date Advance Reimbursement for such Accrual Period;
(xvi) amounts released to the Transferor, as Subordinated Noteholder
and as holder of the Transferor Trust Certificate; and
(xvii) the Administration Fee for such Collection Period.
Each amount set forth pursuant to clauses (iii), (iv), (v), (vi), (ix) and (xi)
above shall be expressed in the aggregate and as a dollar amount per $1,000 of
original principal balance of a Senior Note, Subordinated Note or Trust
Certificate, as applicable.
(b) The Indenture Trustee shall have no duty or obligation to verify
or confirm the accuracy of any of the information or numbers set forth in the
Payment Date Certificate delivered to the Indenture Trustee in accordance with
this Section, and the Indenture Trustee shall be fully protected in relying
upon such Payment Date Certificate.
Section 8.04. Disbursement of Funds.
(a) On each Payment Date, prior to 11:00 a.m., New York City time, the
Origination Trustee (acting through the Trust Agent) shall, in accordance with
the related Payment Date Certificate and pursuant to the instructions of the
Administrative Agent, transfer from the 1999-A SUBI Collection Account all
Securityholder Available Funds and apply such amount, in accordance with the
following priorities:
(i) to the Note Distribution Account, for payment to each respective
Class of Senior Noteholders, an amount equal to the interest
accrued at the applicable Interest Rate for such Class of Senior
Notes during the related Accrual Period on the applicable
Outstanding Amount for such Class (and, to the extent permitted
by applicable law, interest on any overdue interest at the
Overdue Interest Rate);
(ii) to the Reserve Fund, an amount equal to the interest accrued at
the Subordinated Note Rate during the related Accrual Period on
the outstanding Subordinated Notes (and, to the extent permitted
by applicable law, interest on any overdue interest at the
Subordinated Note Rate);
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(iii) to the Certificate Distribution Account, an amount equal to the
interest accrued on the Certificate Balance at the Certificate
Rate (and, to the extent permitted by applicable law, interest
on any overdue interest at the Certificate Rate);
(iv) to the related Distribution Account or, in the case of the
Subordinated Notes, to the Reserve Fund, as payments of
principal, the Quarterly Principal Distributable Amount
attributable to each Class of the Senior Notes, the Trust
Certificates and the Subordinated Notes, in the following order
of priority:
(A) on any Payment Date (so long as the maturity of the Senior
Notes has not been accelerated pursuant to Section 5.02), to
each Class of the Senior Notes, the Subordinated Notes and the
Trust Certificates, sequentially:
1) to each Class of the Senior Noteholders sequentially,
so that no principal will be paid on any Class of Senior Notes
until each Class of Senior Notes with a lower numerical
designation shall have been paid in full, i.e., until the
principal on the Class A-1 Senior Notes shall have been paid in
full, no principal will be paid on the Class A-2, A-3 or A-4
Senior Notes; then until the principal on the Class A-2 Senior
Notes shall have been paid in full, no principal will be paid on
the Class A-3 or A-4 Senior Notes; and until the principal on
the Class A-3 Senior Notes shall have been paid in full, no
principal will be paid on the Class A-4 Senior Notes), until all
Classes of the Senior Notes have been paid in full;
2) to the Subordinated Noteholder until the Subordinated
Notes have been paid in full (which amounts shall be deposited
into the Reserve Fund); and
3) to the Trust Certificateholders pro rata, until the
Trust Certificates have been paid in full; and
(B) on any Payment Date after the maturity of the Senior Notes
has been accelerated pursuant to Section 5.02:
1) to each Class of the Senior Noteholders pro rata (based
on the Outstanding Amount of each Class on such Payment Date)
until all Classes of the Senior Notes have been paid in full;
2) to the Subordinated Noteholder (which amounts shall be
deposited into the Reserve Fund) and to the Certificate
Distribution Account for distribution to the Trust
Certificateholders, for amounts due and unpaid in respect of the
principal amount due and unpaid on the Subordinated Notes and
the Trust Certificates, respectively, ratably, without
preference or priority of any kind, according to the amounts due
and payable to the Subordinated Noteholder and the Trust
Certificateholders; and
(v) to the Reserve Fund, any remaining funds.
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(b) On each Payment Date, after taking into account amounts to be
distributed to Securityholders from the 1999-A SUBI Collection Account, the
Administrative Agent will allocate the Reserve Fund Draw Amount, if any,
reflected in the Payment Date Certificate, with respect to the related
Collection Period and will instruct the Indenture Trustee to make the following
deposits and distributions in the following amounts and order of priority,
prior to 11:00 a.m., New York City time:
(i) to the Note Distribution Account, to pay any remaining interest
due on the outstanding Senior Notes on such Payment Date (and,
to the extent permitted under applicable law, interest on any
overdue interest at the Overdue Interest Rate);
(ii) to the Reserve Fund, an amount equal to any remaining interest
due on the outstanding Subordinated Notes on such Payment Date
(and, to the extent permitted under applicable law, interest on
any overdue interest at the Subordinated Note Rate);
(iii) to the Certificate Distribution Account, an amount equal to any
remaining interest accrued on the Certificates with respect to
such Payment Date (and, to the extent permitted under applicable
law, interest on any overdue interest at the Certificate Rate);
and
(iv) to the related Distribution Account or, in the case of the
Subordinated Notes, to the Reserve Fund (and thereafter, in the
event of any remaining shortfall in amounts required to pay the
Quarterly Principal Distributable Amount with respect to the
Certificates to the Certificate Distribution Account), the
remaining Quarterly Principal Distributable Amount, which will
be allocated to pay principal on the Senior Notes, the
Subordinated Notes and the Certificates in the amounts and order
of priority set forth in Section 8.04(a)(iv).
(c) If on any Payment Date, after giving effect to all deposits to and
withdrawals from the Reserve Fund, the amount on deposit in the Reserve Fund
exceeds the Reserve Fund Requirement, the Indenture Trustee shall distribute
any such excess (i) up to the aggregate amount deposited into the Reserve Fund
in respect of the Subordinated Notes on or prior to the related Payment Date to
the Transferor, in its capacity as the Subordinated Noteholder, and (ii) any
additional excess amounts shall be paid to the Transferor. Upon any such
distributions to the Transferor, the Securityholders will have no further
rights in, or claims to such amounts. Amounts deposited in the Reserve Fund in
accordance with clauses (a)(ii) and (iv) and clauses (b)(ii) and (iv) above
shall be deemed to have been distributed to the Subordinated Noteholder as
payments in respect of interest (and overdue interest) or principal, as
applicable, and the Subordinated Noteholder shall not be entitled to any
further interest on such amounts after the related Payment Date.
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(d) On each Payment Date or Redemption Date, from the amounts on
deposit in the Note Distribution Account, the Indenture Trustee shall duly and
punctually distribute payments of principal and interest on the Senior Notes
due and by check mailed to the Person whose name appears as the registered
holder of a Senior Note (or one or more Predecessor Notes) on the Senior Note
Register as of the close of business on the related Record Date, except that
with respect to Senior Notes registered on the Record Date in the name of the
nominee of DTC (initially, such nominee to be Cede & Co.), payments will be
made by wire transfer in immediately available funds to the account designated
by such nominee. Such checks shall be mailed to the Person entitled thereto at
the address of such Person as it appears on the Senior Note Register as of the
applicable Record Date without requiring that the Senior Note be submitted for
notation of payment. Any reduction in the principal amount of any Senior Note
(or any one or more Predecessor Notes) affected by any payments made on any
Payment Date or Redemption Date shall be binding upon all future holders of any
Senior Note issued upon the registration of transfer thereof or in exchange
hereof or in lieu hereof, whether or not noted thereon. Amounts properly
withheld under the Code by any Person from payment to any Senior Noteholder of
interest or principal shall be considered to have been paid by the Indenture
Trustee to such Senior Noteholder for purposes of this Indenture. If funds are
expected to be available, pursuant to the notice delivered to the Indenture
Trustee, for payment in full of the remaining unpaid principal amount of the
Senior Notes on a Payment Date or Redemption Date, then the Indenture Trustee,
in the name of and on behalf of the Issuer, will notify each Person who was the
registered holder of a Senior Note as of the Record Date preceding the most
recent Payment Date or Redemption Date by notice mailed within thirty days of
such Payment Date or Redemption Date and the amount then due and payable shall
be payable only upon presentation and surrender of the Senior Note at the
Corporate Trust Office of the Indenture Trustee or at the office of the
Indenture Trustee's agent appointed for such purposes located in The City of
New York.
(e) On each Payment Date, the Indenture Trustee shall send by first
class mail an unaudited report (which may be or may be based upon the Payment
Date Certificate prepared by the Administrative Agent) to each Person that was
a Senior Noteholder as of the close of business on the related Record Date
(which shall be Cede as the nominee of DTC unless Definitive Notes are issued
under the limited circumstances described herein), and each Rating Agency
setting forth the following information with respect to such Payment Date or
the related Deposit Date or Collection Period, as the case may be:
(i) SUBI Collections allocable to the 99% 1999-A SUBI Certificates,
and to the 1% 1999-A SUBI Certificates, for such Collection
Period;
(ii) the Senior Note Distribution Amount for each Class of Senior
Notes;
(iii) for each Class of Senior Notes, the amount of the Senior Note
Distribution Amount allocable to interest, the Quarterly
Principal Distributable Amount, the Optimal Principal
Distributable Amount and the Principal Shortfall Amount for such
Class;
(iv) the amount of Available Funds;
(v) the amount of Sales Proceeds Advances and Financial Component
Advances included in Available Funds;
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(vi) the aggregate amount of Residual Value Losses and Residual Value
Surplus for such Collection Period and the Residual Value
Surplus Draw Amount, if any, included in Available Funds (after
giving effect to the distribution of the Retained Certificate
Distribution Amount);
(vii) the Reserve Fund Draw Amount, if any, the balance on deposit in
the Reserve Fund on such Payment Date after giving effect to
withdrawals therefrom and deposits thereto in respect of such
Payment Date, and the change in such balance from the
immediately preceding Payment Date;
(viii) the Outstanding Amount for each Class of Senior Notes (before
giving effect to any distributions in respect of the related
Payment Date);
(ix) the Note Factor for each Class of the Senior Notes;
(x) the amount of Special Event Purchases made during such
Collection Period and the aggregate Securitization Values as of
the Cutoff Date of all Specified Leases relating to Special
Event Purchases made during the related calendar year or since
the Closing Date;
(xi) the Administration Fee for such Collection Period;
(xii) the Payment Date Advance Reimbursement for such Accrual Period;
(xiii) the aggregate amount of SUBI Collections deposited in the Note
Distribution Account; and
(xiv) the Reserve Fund Deposit Amount, if any.
Each amount set forth pursuant to clauses (ii), (iii), (viii) and (xi) above
shall be expressed in the aggregate and as a dollar amount per $1,000 of
original principal balance of a Senior Note, Subordinated Note or Trust
Certificate, as applicable. Senior Note Owners may obtain copies of such
reports upon a request in writing to the Indenture Trustee at the Corporate
Trust Office.
Section 8.05. General Provisions Regarding Accounts.
(a) For so long as no Default or Indenture Default shall have occurred
and be continuing, all of the funds in the Reserve Fund shall be invested and
reinvested by the Indenture Trustee, until the Outstanding Amount has been
reduced to zero and thereafter by the Owner Trustee, at the direction of the
Administrator in Permitted Investments as set forth in Section 4.02(a) of the
Origination Trust Agreement, which mature no later than the Deposit Date
succeeding the date of such investment, including those offered by the
Indenture Trustee or an Affiliate thereof. No such investment shall be sold
prior to maturity. Any investment earnings on the Reserve Fund will be taxable
to the Transferor. On each Payment Date, net investment earnings on the Reserve
Fund shall be deposited in the Reserve Fund.
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(b) Subject to Section 6.01(c), the Indenture Trustee shall not in any
way be held liable by reason of any insufficiency in the Reserve Fund resulting
from any loss on any Permitted Investment included therein, except for losses
attributable to the Indenture Trustee's failure to make payments on any such
Permitted 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 Administrator shall have failed to give investment
directions for any funds on deposit in the Reserve Fund to the Indenture
Trustee by 11:00 a.m., New York City time (or such other time as may be agreed
by the Administrator and Indenture Trustee), on any Business Day or (ii) a
Default or Indenture Default shall have occurred and be continuing with respect
to the Senior Notes but the Senior Notes shall not have been declared due and
payable pursuant to Section 5.02 or (iii) if the Senior Notes shall have been
declared due and payable following an Indenture Default, 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
investments that are Permitted Investments as set forth in paragraph (vi) of
the definition thereof.
Section 8.06. Release of Trust Estate.
(a) Subject to the payment of its fees and expenses pursuant to
Section 6.07, the Indenture Trustee may, and when required by the provisions of
this Indenture shall, execute instruments to release property from the lien of
this Indenture, or convey the Indenture Trustee's interest in the same, in a
manner and under circumstances that are not inconsistent with the provisions of
this Indenture. No party relying upon an instrument executed by the Indenture
Trustee as provided in this Article shall be bound to ascertain the Indenture
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any monies.
(b) The Indenture Trustee shall, at such time as there are no Senior
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 Senior 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. Such release shall include delivery to the Issuer or its
designee of the 1999-A SUBI Certificates and the Subordinated Notes and
delivery to the Securities Intermediary under the Control Agreement of a
certificate evidencing the release of the lien of this Indenture and transfer
of dominion and control over the Reserve Fund to the Owner Trustee. The
Indenture Trustee shall release property from the lien of this Indenture
pursuant to this Section only upon receipt of an Issuer Request.
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ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent of Senior
Noteholders.
(a) Without the consent of the Senior Noteholders, but with prior
notice to each Rating Agency and subject to the satisfaction of the Rating
Agency Condition, the Issuer and the Indenture Trustee, when so requested by an
Issuer Request, at any time and from time to time, may enter into one or more
indentures supplemental hereto, 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 or confirm unto the Indenture Trustee any property
subject or required to be subjected to the lien of this
Indenture, or to subject additional property to the lien of this
Indenture;
(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
contained herein and in the Senior Notes;
(iii) to add to the covenants of the Issuer for the benefit of the
Senior Noteholders or to surrender any right or power herein
conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any property to
or with the Indenture Trustee;
(v) to cure any ambiguity, correct or supplement any provision
herein or in any supplemental indenture that may be defective or
inconsistent with any other provision herein or in any
supplemental indenture or make any other provisions with respect
to matters or questions arising under this Indenture or in any
supplemental indenture that shall not be inconsistent with the
provisions of this Indenture; provided that such other
provisions shall not adversely affect the interests of the
Senior Noteholders; or
(vi) to evidence and provide for the acceptance of the appointment
hereunder by a successor trustee with respect to the Senior
Notes or to add to or change any of the provisions of this
Indenture as shall be necessary to facilitate the administration
of the trusts hereunder by more than one trustee, pursuant to
the requirements of Article Six.
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 as may be therein contained.
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(b) The Issuer and the Indenture Trustee, when requested by an Issuer
Request, may 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 for the purpose of modifying in any
manner (other than the modifications set forth in Section 9.02, which require
consent of the Holder of each Senior Note affected thereby) the rights of the
Senior Noteholders under this Indenture; provided, however, that (i) such
action shall not materially adversely affect the interests of any Senior
Noteholder, (ii) the Rating Agency Condition shall have been satisfied with
respect to such action and (iii) such action shall not, as evidenced by an
Opinion of Counsel, (A) affect the treatment of the Senior Notes as debt for
federal income tax purposes, (B) be deemed to cause a taxable exchange of the
Senior Notes for federal income tax purposes or (C) cause the Issuer, the
Transferor or the Origination Trust to be taxable as an association (or a
publicly traded partnership) taxable as a corporation for federal income tax
purposes.
Section 9.02. Supplemental Indentures With Consent of Senior
Noteholders. The Issuer and the Indenture Trustee, when requested by an Issuer
Request, also may, with the consent of Senior Noteholders holding not less than
a majority of the Outstanding Amount, by Act of such Senior 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 Senior Noteholders under this
Indenture subject to the satisfaction of the Rating Agency Condition and
provided that no such supplemental indenture shall, without the consent of the
Senior Noteholder of each Outstanding Senior Note affected thereby:
(a) change the Senior Note Final Payment Date of or the date of
payment of any installment of principal of or interest on any Senior Note, or
reduce the principal amount thereof, the interest rate thereon or the
Redemption Price with respect thereto, change the provision of this Indenture
relating to the application of collections on, or the proceeds of the sale of,
the Trust Estate to payment of principal of or interest on the Senior Notes, or
change any place of payment where, or the coin or currency in which, any Senior
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 Five, to the
payment of any such amount due on the Senior Notes on or after the respective
due dates thereof (or, in the case of redemption, on or after the Redemption
Date);
(b) reduce the percentage of the Outstanding Amount, the consent of
the Senior Noteholders of which is required for any such supplemental indenture
or the consent of the Senior Noteholders of which is required for any waiver of
compliance with provisions of this Indenture or Indenture Defaults hereunder
and their consequences provided for in this Indenture;
(c) modify or alter the provisions of the proviso to the definition of
the term "Outstanding";
(d) reduce the percentage of the Outstanding Amount required to direct
the Indenture Trustee to direct the Owner Trustee to sell the Trust Estate
pursuant to Section 5.04, if the proceeds of such sale would be insufficient to
pay the Outstanding Amount plus accrued but unpaid interest on the Senior
Notes;
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(e) modify any provision of this Section, except to increase any
percentage specified herein or to provide that certain additional provisions of
this Indenture or the other Basic Documents cannot be modified or waived
without the consent of the Senior Noteholder of each Outstanding Senior Note
affected thereby;
(f) 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 otherwise permitted or contemplated herein, terminate the lien of
this Indenture on any property at any time subject hereto or deprive any Senior
Noteholder of the security provided by the lien of this Indenture; or
(g) impair the right to institute suit for the enforcement of payment
as provided in Section 5.07.
Any such supplemental indenture shall be executed only upon delivery
of an Opinion of Counsel to the same effect as in Section 9.01(b). The
Indenture Trustee may in its discretion determine whether or not any Senior
Notes would be affected by any supplemental indenture and any such
determination shall be conclusive upon all Senior Noteholders, 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 Senior 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 Senior Noteholders to which such amendment or supplemental
indenture relates a notice setting forth in general terms the substance of such
supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
Section 9.03. Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article or the modifications thereby of the trusts created by
this Indenture, the Indenture Trustee shall be entitled to receive, and subject
to Sections 6.01 and 6.02, shall be fully protected in relying upon, an Opinion
of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Indenture Trustee may but shall
not be obligated to enter into any such supplemental indenture that affects the
Indenture Trustee's own rights, duties, liabilities or indemnities 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 Senior Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer, the Owner Trustee and the
Senior Noteholders shall thereafter be determined, exercised and enforced
hereunder subject in all respects to such modifications and amendments, and all
the terms and conditions of any such supplemental indenture shall be and shall
be deemed to be part of the terms and conditions of this Indenture for any and
all purposes.
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Section 9.05. Reference in Senior Notes to Supplemental Indentures.
Senior Notes authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and if required by the
Indenture Trustee shall, bear a notation in form approved by the Indenture
Trustee as to any matter provided for in such supplemental indenture. If the
Issuer or the Indenture Trustee shall so determine, new Senior 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 Senior Notes.
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ARTICLE TEN
REDEMPTION OF SENIOR NOTES
Section 10.01. Redemption.
(a) Pursuant to Section 9.01 of the Trust Agreement, the Transferor
shall be permitted at its option to purchase the interest in the 1999-A SUBIs
evidenced by the 99% 1999-A Vehicle SUBI Certificate from the Issuer on any
Payment Date if, either before or after giving effect to any payment of
principal required to be made on such Payment Date, the Senior Note Balance is
less than or equal to 10% of the Initial Securities Balance. The purchase price
for the 99% 1999-A Vehicle SUBI Certificate shall equal the unpaid principal
balances of the Securities, together with accrued interest thereon to the
Redemption Date (the "Optional Purchase Price"), which amount shall be
deposited by the Transferor into the 1999-A SUBI Collection Account on the
Deposit Date relating to the Redemption Date. In connection with an Optional
Purchase, the Senior Notes shall be redeemed on the Redemption Date in whole,
but not in part, for the Redemption Price and thereupon the pledge of the 99%
1999-A Lease SUBI shall be discharged and released and the 99% 1999-A Lease
SUBI Certificate shall be returned to the Issuer.
(b) If the Transferor exercises the Optional Purchase, on the
Redemption Date, prior to 11:00 a.m., New York City time, the Origination
Trustee (acting through the Trust Agent) shall transfer the Optional Purchase
Price as part of the Available Funds from the 1999-A SUBI Collection Account as
follows: (i) to the Note Distribution Account, the Redemption Price, (ii) to
the Reserve Fund, the Subordinated Note Redemption Price and (iii) to the
Certificate Distribution Account, the Repayment Price.
(c) If the Senior Notes are to be redeemed pursuant to this Section,
the Administrator or the Issuer shall provide at least 45 days' prior notice of
the redemption of the Senior Notes to the Indenture Trustee and the Owner
Trustee, and the Indenture Trustee shall provide at least 30 days' notice
thereof to the Senior Noteholders.
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, mailed to each holder of Senior Notes as of the close of
business on the Record Date preceding the applicable Redemption Date at such
holder's address appearing in the Senior Note Register. In addition, the
Administrator shall notify each Rating Agency upon the redemption of the Senior
Notes, pursuant to the Issuer Administration Agreement.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) the place where the Senior Notes to be redeemed 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); and
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(d) that on the Redemption Date, the Redemption Price will become due
and payable upon each such Senior Note and that interest thereon shall cease to
accrue from and after the Redemption Date.
Notice of redemption of the Senior 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 Senior Noteholder shall not
impair or affect the validity of the redemption of any other Senior Note.
Section 10.03. Senior Notes Payable on Redemption Date. The Senior
Notes to be redeemed shall, following notice of redemption as required by
Section 10.02, become due and payable on the Redemption Date at the Redemption
Price and (unless the Issuer shall default in the payment of the Redemption
Price) no interest shall accrue on the Redemption Price for any period after the
date to which accrued interest is calculated for purposes of calculating the
Redemption Price.
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ARTICLE ELEVEN
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions.
(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 and each Rating Agency (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 and (ii) an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, except that, in the case
of any such application or request as to which the furnishing of such documents
is specifically required by any provision of this Indenture, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or opinion
has read such covenant or condition and the definitions herein
relating thereto;
(ii) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained
in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory, such
signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed
opinion as to whether or not such covenant or condition has been
complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
(b) In addition to any obligation imposed in Section 11.01(a) or
elsewhere in this Indenture:
(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 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.
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(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 of the property or securities to be so deposited
and of all other such securities made the basis of any such
withdrawal or release since the commencement of the then-current
calendar year of the Issuer, as set forth in the certificates
delivered pursuant to clause (i) above and this clause, is 10%
or more of the Outstanding Amount, but such a certificate need
not be furnished with respect to any 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 1% of
the Outstanding Amount.
(iii) Other than with respect to any release described in clause (A)
or (B) of Section 11.01(b)(v), whenever any property or
securities are to be released from the lien 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 will not impair the security under this
Indenture in contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the Indenture
Trustee an 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, or securities (other than property described
in clauses (A) or (B) of Section 11.01(b)(v)) released from the
lien of this Indenture since the commencement of the then
current calendar year, as set forth in the Officer's
Certificates required by clause (iii) above and this clause,
equals 10% or more of the Outstanding Amount, but such Officer's
Certificate need not be furnished in the case of any release of
property or securities if the fair value thereof as set forth in
the related Officer's Certificate is less than $25,000 or less
than 1% of the Outstanding Amount.
(v) Notwithstanding Section 2.08 or any other provision of this
Section, the Issuer may (A) collect, liquidate, sell or
otherwise dispose of the Collateral as and to the extent
permitted or required by the Basic Documents and (B) make cash
payments out of the Accounts as and to the extent permitted or
required by 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.
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Any certificate or opinion of an Authorized Officer may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate of an Authorized Officer or Opinion of Counsel
may be based, insofar as it relates to factual matters, upon a certificate or
opinion of or representations by an officer or officers of the Administrator,
the Transferor or the Issuer, stating that the information with respect to such
factual matters is in the possession of the Administrator, the Transferor or
the Issuer, unless such officer or counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to such matters are erroneous.
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 terms hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of
the facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article Six.
Section 11.03. Acts of Senior Noteholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Senior Noteholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Senior 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 Senior 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 Senior Notes shall be proved by the Senior Note
Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the holder of any Senior Note shall bind the holder
of every Senior 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 Senior Note.
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Section 11.04. Notices. All demands, notices and communications
hereunder shall be in writing and shall be delivered or mailed by registered or
certified first-class United States mail, postage prepaid, hand delivery,
prepaid courier service, or by telecopier, and addressed in each case as
follows: (i) if to the Issuer c/o the Owner Trustee, at 1201 Market Street,
Wilmington, Delaware 19801 (telecopier no. (302) 984-4903), Attention:
Corporate Trust Department with a copy to the Administrator, at 3600 N.W. 82nd
Avenue, Miami, Florida 33166 (telecopier no. (305) 500-3726), Attention:
Treasurer; (ii) if to the Indenture Trustee, at One Illinois Center, 111 East
Wacker Drive, Suite 3000, Chicago, Illinois 60601 (telecopier no. (312)
228-9401), Attention: Ryder Truck Leasing; (iii) if to Moody's, to 99 Church
Street, New York, New York 10007, Attention: ABS Monitoring Group; (iv) if to
DCR, to Duff & Phelps Credit Rating Co., 55 East Monroe Street, Suite 3800,
Chicago, Illinois 60603 (telecopier no. (312) 368-2069), Attention: Asset
Backed Monitoring Group (Equipment Leases); or (v) at such other address as
shall be designated by any of the foregoing in a written notice to the other
parties hereto. Delivery shall occur only upon receipt or reported tender of
such communication by an officer of the recipient entitled to receive such
notices located at the address of such recipient for notices hereunder.
Section 11.05. Notices to Senior Noteholders; Waiver. Where this
Indenture provides for notice to Senior Noteholders of any event, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first class, postage prepaid to each Senior Noteholder
affected by such event, at his address as it appears on the Senior Note
Register, not later than the latest and not earlier than the earliest date
prescribed for the giving of such notice. In any case where notice to Senior
Noteholders is given by mail, neither the failure to mail such notice nor any
defect in any notice so mailed to any particular Senior Noteholder shall affect
the sufficiency of such notice with respect to other Senior 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 Senior 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 of Senior 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 each Rating Agency,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute an Indenture
Default.
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Section 11.06. 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 11.07. Successors and Assigns. All covenants and agreements in
this Indenture and the Senior 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.
Section 11.08. Severability. In case any provision in this Indenture
or in the Senior 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 11.09. Benefits of Indenture. Nothing in this Indenture or in
the Senior Notes, express or implied, shall give to any Person, other than the
parties hereto and their successors hereunder, the Senior Noteholders (and,
with respect to Sections 8.03 and 8.04, the Trust Certificateholders), 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 11.10. Legal Holidays. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Senior 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 11.11. Governing Law. This Indenture shall be construed in
accordance with the laws of the State of New York, and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
Section 11.12. 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 11.13. 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 accompanied by an Opinion of Counsel (who may be counsel
to the Indenture Trustee or any other counsel reasonably acceptable to the
Indenture Trustee) to the effect that such recording is necessary either for
the protection of the Senior Noteholders or any other Person secured hereunder
or for the enforcement of any right or remedy granted to the Indenture Trustee
under this Indenture.
Section 11.14. 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 Senior Notes or under this Indenture or any
certificate or other writing delivered in connection herewith or therewith,
against (i) the Indenture Trustee or the Owner Trustee in its individual
capacity, (ii) any Trust Certificateholder, (iii) any owner of a beneficial
interest in the Issuer or (iv) any partner, owner, beneficiary, agent, officer,
director, employee or agent of the Indenture Trustee or the Owner Trustee in
its individual capacity, any Trust Certificateholder, the Owner Trustee or the
Indenture Trustee 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 capacity) and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution or failure to pay any installment or call owing to such
entity. For all purposes of this Indenture, in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Articles Six, Seven
and Ten of the Trust Agreement.
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Section 11.15. No Petition. The Indenture Trustee, by entering into
this Indenture, and each Senior Noteholder or Note Owner, by accepting a Senior
Note or in the case of a Note Owner, a beneficial interest in a Senior Note,
hereby covenants and agree that they will not institute, or join in
instituting, any bankruptcy, reorganization, arrangement, insolvency or
liquidation Proceeding, or other Proceeding under federal or State bankruptcy
or similar laws for a period of one year and a day after:
(a) payment in full of all amounts due to each Holder in respect of
the UTI, the 1999-A SUBIs or any Other SUBIs, against any UTI Beneficiary (or
any general partner of any UTI Beneficiary which is a partnership), the
Origination Trust and the Origination Trustee, without the consent of 100% of
the Holders of the 1999-A SUBIs and any Others (excluding the UTI
Beneficiaries, the Transferor or any of their respective Affiliates); and
(b) payment in full of the Offered Securities, against the Transferor
or the Issuer; provided, however, that 100% of the Senior Noteholders, or, if
no Senior Notes are then outstanding, the Subordinated Noteholder and if no
Subordinated Notes are then outstanding, 100% of the Trust Certificateholders
(in each case excluding the Transferor and any of its Affiliates) may at any
time institute or join in instituting any bankruptcy, reorganization,
insolvency or liquidation proceeding against the Transferor or the Issuer.
Section 11.16. No Recourse. Each Senior Noteholder or Senior Note
Owner, by acceptance of a Senior Note or, in the case of a Senior Note Owner, a
beneficial interest in a Senior 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 Senior 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) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Indenture Trustee or the Owner Trustee in its individual capacity or any
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 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.
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Section 11.17. Inspection. The Issuer agrees that on reasonable prior
notice it will permit any representative of the Indenture Trustee, during the
Issuer's normal business hours, to examine all the books of account, records,
reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees and Independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested. 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 the Indenture Trustee may reasonably determine that such
disclosure is consistent with its obligations hereunder.
Section 11.18. Limitation of Liability of Owner Trustee.
Notwithstanding anything contained herein to the contrary, this instrument has
been countersigned by Chase Manhattan Bank Delaware not in its individual
capacity but solely in its capacity as Owner Trustee of the Issuer and in no
event shall Chase Manhattan Bank Delaware in its individual capacity or any
beneficial owner of the Issuer have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer hereunder,
as to all of which recourse shall be had solely to the assets of the Issuer.
For all purposes of this Indenture, in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Articles Six, Seven
and Ten of the Trust Agreement. Notwithstanding anything herein to the
contrary, Section 2.07 of the Trust Agreement shall remain in full force and
effect.
Section 11.19. TIA Incorporation and Conflicts. 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. 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 TIA, such required provision shall
control.
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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.
RYDER VEHICLE LEASE TRUST 1999-A
By: CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
By: ____________________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as Indenture Trustee
By: ____________________________________
Name:
Title:
Receipt of this original counterpart of this Agreement is hereby
acknowledged on this _____ day of ________________1999.
RTRT, INC.,
as Origination Trustee
By: ____________________________________
Name:
Title:
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STATE OF _______________)
)ss
COUNTY OF _____________ )
On __________ before me, ____________________________________________,
[insert date] [Here insert name and title of notary]
personally appeared _________________________________________________,
[ ] personally known to me, or
[ ] proved to me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within
instrument,
and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ties), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which such
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
[Seal] Signature _____________________
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<PAGE> 80
STATE OF _______________)
)ss
COUNTY OF _____________ )
On __________ before me, ____________________________________________,
[insert date] [Here insert name and title of notary]
personally appeared _________________________________________________,
[ ] personally known to me, or
[ ] proved to me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within
instrument,
and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ties), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which such
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
[Seal] Signature _____________________
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STATE OF _______________)
)ss
COUNTY OF _____________ )
On __________ before me, ____________________________________________,
[insert date] [Here insert name and title of notary]
personally appeared __________________________________________________,
[ ] personally known to me, or
[ ] proved to me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within
instrument,
and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ties), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which such
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
[Seal] Signature _____________________
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<PAGE> 82
EXHIBIT A
FORM OF SENIOR NOTE
SEE REVERSE FOR CERTAIN DEFINITIONS
UNLESS THIS SENIOR 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 SENIOR 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 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.
TRANSFERS OF THE NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE TAX
TRANSFER DOCUMENTATION AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE
INDENTURE.
THE HOLDER, BY ACCEPTANCE OF THIS NOTE, SHALL BE DEEMED TO HAVE AGREED TO TREAT
THE NOTES AS DEBT SOLELY OF THE ISSUER FOR UNITED STATES FEDERAL AND STATE
INCOME TAX PURPOSES.
RYDER VEHICLE LEASE TRUST 1999-A
[______] % ASSET BACKED SENIOR NOTE, CLASS [A-1] [A-2] [A-3] [A-4]
REGISTERED $[_________]
No. R-[___] CUSIP NO. [_________]
Ryder Vehicle Lease Trust 1999-A, a business trust organized and
existing under the laws of the State of Delaware (including any permitted
successors and assigns, the "Issuer"), for value received, hereby promises to
pay to CEDE & CO., or registered assigns, the principal sum of
[______________________________] Dollars ($[__________]) in quarterly
installments on January 15, April 15, July 15 and October 15 of each year, or
if such day is not a Business Day, on the immediately succeeding Business Day,
commencing on January 17, 2000 (each, a "Payment Date") until the principal of
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<PAGE> 83
this Senior Note is paid or made available for payment, and to pay interest on
each Payment Date on the Class [A-1] [A-2] [A-3] [A-4] Note Balance as of the
preceding Payment Date (after giving effect to all payments of principal made
on the preceding Payment Date), or as of the Closing Date in the case of the
first Payment Date or if no interest has yet been paid, at the rate per annum
shown above (the "Interest Rate"), in each case as and to the extent described
below; provided, however, that the entire Class [A-1] [A-2] [A-3 ] [A-4] Note
Balance shall be due and payable on the earlier of [___________] 15, 200[__]
(the "Senior Note Final Payment Date") and the Redemption Date, if any,
pursuant to Section 10.01 of the Indenture. The Issuer shall pay interest on
overdue installments of interest at the Interest Rate to the extent lawful.
Such principal of and interest on this Senior Note shall be paid in the manner
specified on the reverse hereof.
The principal of and interest on this Senior Note are payable in such
coin or currency of the United States 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 Senior Note shall be applied first to interest due and payable
on this Senior Note as provided above and then to the unpaid principal of this
Senior Note.
Reference is made to the further provisions of this Senior Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Senior Note.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee the name of which appears below by manual signature, this
Senior Note shall not be entitled to any benefit under the Indenture referred
to on the reverse hereof or be valid or obligatory for any purpose.
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<PAGE> 84
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or by facsimile, by its Authorized Officer as of the date set
forth below.
Dated: _______________, 1999 RYDER VEHICLE LEASE TRUST 1999-A,
By: CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
By: _______________________________
Name: _____________________________
Title: ____________________________
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Senior Notes designated above and referred to in
the within-mentioned Indenture.
Dated: _______________, 1999 U.S. BANK NATIONAL ASSOCIATION.
as Indenture Trustee
By: CHASE MANHATTAN BANK DELAWARE,
By: ______________________________
Name: ____________________________
Title: ___________________________
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<PAGE> 85
[REVERSE OF SENIOR NOTE]
This Senior Note is one of a duly authorized issue of Senior Notes of
the Issuer, designated as its " [_______]% Asset Backed Senior Notes, Class
[A-1] [A-2] [A-3] [A-4] " (herein called the "Senior Notes") issued under an
Indenture, dated as of [_______], 1999 (such indenture, as supplemented or
amended, is herein called the "Indenture"), between the Issuer and U.S. Bank
National Association, as trustee (the "Indenture Trustee", which term includes
any successor Indenture Trustee under the Indenture), to which Indenture and
all indentures supplemental thereto reference is hereby made for a statement of
the respective rights and obligations thereunder of the Issuer, the Indenture
Trustee and the Senior Noteholders. The Senior Notes are subject to all terms
of the Indenture. All terms used in this Senior Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes are and will be equally and ratably secured by the Collateral
pledged as security therefor as provided in the Indenture. However, to the
extent provided in the Indenture, each Class will receive principal payment
sequentially so no principal payments shall be made in respect of the Class A-2
Notes until the Class A-1 Notes have been paid in full, no principal payments
shall be made in respect of the Class A-3 Notes until the Class A-2 Notes have
been paid in full, and no principal payments shall be made in respect of the
Class A-4 Notes until the Class A-3 Notes have been paid in full.
Principal payable on the Senior Notes will be paid on each Payment
Date in the amount specified in the Indenture. As described above, the entire
unpaid principal amount of this Senior Note will be payable on the earlier of
the Senior Note Final Payment Date and the Redemption Date, if any, selected
pursuant to the Indenture. Notwithstanding the foregoing, under certain
circumstances, the entire unpaid principal amount of the Senior Notes shall be
due and payable following the occurrence and continuance of an Indenture
Default, as described in the Indenture. All principal payments on the Senior
Notes shall be made pro rata to the Senior Noteholders entitled thereto.
Payments of principal and interest on this Senior Note due and payable
on each Payment Date or Redemption Date shall be made by check mailed to the
Person whose name appears as the registered holder of this Senior Note (or one
or more Predecessor Notes) on the Senior Note Register as of the close of
business on the related Record Date, except that with respect to Senior Notes
registered on the Record Date in the name of the nominee of The Depository
Trust Company (initially, such nominee to be Cede & Co.), payments will be made
by wire transfer in immediately available funds to the account designated by
such nominee. Such checks shall be mailed to the Person entitled thereto at the
address of such Person as it appears on the Senior Note Register as of the
applicable Record Date without requiring that this Senior Note be submitted for
notation of payment. Any reduction in the principal amount of this Senior Note
(or any one or more Predecessor Notes) affected by any payments made on any
Payment Date or Redemption Date shall be binding upon all future holders of
this Senior Note and of any Senior Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted
hereon. If funds are expected to be available, as provided in the Indenture,
4
<PAGE> 86
for payment in full of the remaining unpaid principal amount of this Senior
Note on a Payment Date or Redemption Date, then the Indenture Trustee, in the
name of and on behalf of the Issuer, will notify the Person who was the
registered holder hereof as of the Record Date preceding such Payment Date or
Redemption Date by notice mailed within five days of such Payment Date or
Redemption Date and the amount then due and payable shall be payable only upon
presentation and surrender of this Note at the Corporate Trust Office of the
Indenture Trustee or at the office of the Indenture Trustee's agent appointed
for such purposes located in The City of New York.
As provided in the Indenture, the Transferor will be permitted at its
option to purchase the interest in the 1999-A SUBI evidenced by the 99% 1999-A
Vehicle SUBI Certificate from the Issuer on any Payment Date if, either before
or after giving effect to any payment of principal required to be made on such
Payment Date, the Senior Note Balance is less than or equal to 10% of the
Initial Securities Balance. The purchase price for the 99% 1999-A Vehicle SUBI
Certificate shall equal the unpaid principal balances of the Securities,
together with accrued interest thereon to the Redemption Date and certain other
amounts (the "Optional Purchase Price"), which amount shall be deposited by the
Transferor into the 1999-A SUBI Collection Account on the Deposit Date relating
to the Payment Date fixed for redemption. In connection with an Optional
Purchase, the Senior Notes will be redeemed on such Payment Date in whole, but
not in part, for the Redemption Price and thereupon the pledge of the 99%
1999-A Lease SUBI shall be discharged and released and the 99% 1999-A Lease
SUBI Certificate shall be returned to the Transferor.
As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Senior Note may be registered on the Senior
Note Register upon surrender of this Senior Note for registration of transfer
at the office or agency designated by the Issuer pursuant to the Indenture. No
service charge will be charged for any registration of transfer or exchange of
this Senior Note, but the transferor may be required to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any such registration of transfer or exchange.
Each Senior Noteholder or Senior Note Owner, by acceptance of a Senior
Note or, in the case of a Senior Note Owner, a beneficial interest in a Senior
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 Senior 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) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director or employee of the Indenture Trustee or
the Owner Trustee in its individual capacity, any 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 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.
5
<PAGE> 87
The Senior Notes represent obligations of the Issuer only and do not
represent interests in, recourse to or obligations of the Transferor, the UTI
Beneficiaries or any of their respective Affiliates.
Each Senior Noteholder, or in the case of a Senior Note Owner, by
acceptance of a Senior Note, in the case of a Senior Note Owner, a beneficial
interest in the Senior Note, hereby covenants and agree that they will not
institute, or join in instituting, any bankruptcy, reorganization, arrangement,
insolvency or liquidation Proceeding, or other Proceeding under federal or
State bankruptcy or similar laws for a period of one year and a day after:
(a) payment in full of all amounts due to each Holder in respect
of the UTI, the 1999-A SUBIs or any Other SUBIs, against any UTI
Beneficiary (or any general partner of any UTI Beneficiary which is a
partnership), the Origination Trust and the Origination Trustee,
without the consent of 100% of the Holders of the 1999-A SUBIs and any
Other SUBIs (excluding the UTI Beneficiaries, the Transferor or any of
their respective Affiliates); and
(b) payment in full of the Offered Securities, against the
Transferor or the Issuer; provided, however, that 100% of the Senior
Noteholders, or, if no Senior Notes are then outstanding, the
Subordinated Noteholder or, if no Subordinated Notes are outstanding,
100% of the Trust Certificateholders (in each case excluding the
Transferor and any of its Affiliates) may at any time institute or
join in instituting any bankruptcy, reorganization, insolvency or
liquidation proceeding against the Transferor or the Issuer.
Prior to the due presentment for registration of transfer of this
Senior Note, the Owner Trustee, the Indenture Trustee and any agent of the
Owner Trustee or the Indenture Trustee may treat the Person in whose name this
Senior Note (as of the day of determination or as of such other date as may be
specified in the Indenture) is registered as the owner hereof for all purposes,
whether or not this Senior Note be overdue, and neither the Owner Trustee, the
Indenture Trustee nor any such agent shall be affected by notice to the
contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Senior Noteholders under the Indenture at any time
by the Issuer with the consent of Senior Noteholders representing not less than
a majority of the Outstanding Amount. The Indenture also contains provisions
permitting Senior Noteholders representing specified percentages of the
Outstanding Amount, on behalf of all Senior Noteholders, to waive compliance by
the Issuer with certain provisions of the Indenture and certain past Defaults
under the Indenture and their consequences. Any such consent or waiver by the
Senior Noteholder of this Senior Note (or any one of more Predecessor Notes)
shall be conclusive and binding upon such Senior Noteholder and upon all future
Senior Noteholders of this Senior Note and of any Senior Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof whether
or not notation of such consent or waiver is made upon this Senior Note. The
Indenture also permits the Indenture Trustee to amend or waive certain terms
and conditions set forth in the Indenture without the consent of the Senior
Noteholders.
6
<PAGE> 88
The Senior Notes are issuable only in registered form in denominations
as provided in the Indenture, subject to certain limitations therein set forth.
This Senior Note and the Indenture shall be construed in accordance
with the laws of the State of New York, 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 Senior
Note or 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
Senior Note at the times, place and rate and in the coin or currency herein
prescribed.
7
<PAGE> 89
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 Senior Note and all rights thereunder, and hereby
irrevocably constitutes and appoints attorney, to transfer said Senior Note on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated:(1)
Signature Guaranteed:
---------------------------------
- --------
(1) The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Senior Note in
every particular, without alteration, enlargement or any change whatsoever.
8
<PAGE> 90
EXHIBIT B
FORM OF DEPOSITORY AGREEMENT
1
<PAGE> 1
EXHIBIT 8.1
________________, 1999
TO THE ADDRESSEES LISTED
ON SCHEDULE I HERETO:
Re: Ryder Vehicle Lease Trust 1999-A
Ladies and Gentlemen:
We have acted as federal income tax counsel to Ryder Funding LP (the
"Transferor") in connection with the preparation of the Registration Statement
(Registration No. 333-81455) filed on Form S-1 with the Securities and Exchange
Commission on ___________, 1999, as amended to the date hereof (the
"Prospectus"). All capitalized terms not otherwise defined herein have the
meanings given to them in the Prospectus.
In so acting, we have examined originals or copies, certified or otherwise
identified to our satisfaction, of the Prospectus, the SUBI Trust Agreement,
the Administration Agreement, the Program Operating Lease, the SUBI Certificate
Transfer Agreement, the Senior Notes, the Certificates, the Subordinated Notes
and such other agreements, records, documents, and instruments, as in our
judgement were necessary or appropriate (the "Documents"), and have made such
inquiries of such officers and representatives of the Transferor and such other
persons, as we have deemed relevant and necessary as a basis for the opinion
hereinafter set forth. In such examination, we have assumed the authenticity of
all documents submitted to us as originals, the conformity to original
documents of all documents submitted to us as certified or photostatic copies,
the authenticity of the originals of such latter documents, the genuineness of
all signatures, and the correctness of all representations made therein. We
have further assumed that the final executed Documents are substantially the
same as those that we have reviewed and that there are no agreements or
understandings between or among the parties to the Documents with respect to
the transactions contemplated therein other than those contained in the
Documents. Finally, our opinions are based on the assumption that all parties
to the Documents will comply with the terms thereof, including all tax
reporting requirements contained therein.
Based on the foregoing, subject to the next succeeding paragraph, and
assuming full
<PAGE> 2
Ryder Funding LP
Page 2
compliance with all the terms of the Documents, we confirm the opinions
included in the Prospectus under the caption "Material Federal Income Tax
Consequences," insofar as such statements constitute matters of law or legal
conclusions and except to the extent qualified therein, are correct in all
material respects.
The foregoing opinion is based on current provisions of the Internal
Revenue Code of 1986, as amended, the Treasury Regulations promulgated
thereunder, published pronouncements of the Internal Revenue Service, and case
law with respect thereto, any of which may be changed at any time with
retroactive effect. Further, you should be aware that opinions of counsel are
not binding on the Internal Revenue Service or the courts. We express no
opinion as to any matters not specifically covered by the foregoing
opinion, or as to the effect on the matters covered by this opinion on any other
matters, or as to the laws of any other jurisdictions. Additionally, we
undertake no obligation to update this opinion in the event there is either a
change in the legal authorities, in the facts, including the taking of any
action by any party to any of the transactions described in the Documents
pursuant to any opinion of counsel as required by any of the Documents relating
to such transactions, or in the Documents on which this opinion is based, or an
inaccuracy in any of the representations or warranties upon which we have relied
in rendering this opinion.
We consent to the filing of this letter as Exhibit 8.1 to the Registration
Statement and to the references in the Prospectus under the captions "Tax
Status" and "Material Federal Income Tax Consequences" to our firm. This
opinion may not be used for any other purpose.
Very truly yours,
STEEL HECTOR & DAVIS LLP
<PAGE> 1
Exhibit 10.1
===============================================================================
RYDER TRUCK RENTAL I LP
and
RYDER TRUCK RENTAL II LP,
as Grantors and UTI Beneficiaries,
RYDER TRUCK RENTAL, INC.,
as Administrative Agent,
RTRT, INC.,
as Trustee,
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
as Delaware Trustee,
and, for certain limited purposes only,
U.S. BANK NATIONAL ASSOCIATION,
as Trust Agent
------------------------------------------------------------------
RYDER TRUCK RENTAL LT
SECOND AMENDED AND RESTATED TRUST AGREEMENT
Dated as of February 1, 1998
------------------------------------------------------------------
===============================================================================
<PAGE> 2
TABLE OF CONTENTS
Page
----
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions............................................. 1
Section 1.02. Interpretive Provisions.................................14
ARTICLE TWO
THE TRUST
Section 2.01. General..................................................15
Section 2.02. Offices..................................................15
Section 2.03. Purposes.................................................15
Section 2.04. Conveyance of Trust Assets...............................15
Section 2.05. Document Execution and Performance.......................16
Section 2.06. Securitization Holders...................................16
ARTICLE THREE
BENEFICIAL INTERESTS IN THE TRUST
Section 3.01. Creation of UTI; UTI Pledges.............................17
Section 3.02. SUBI Certificates........................................18
Section 3.03. UTI Certificates.........................................19
Section 3.04. Registration and Transfer of Certificates; Validity......20
Section 3.05. Beneficiaries; Action Upon Instruction...................20
Section 3.06. Filings..................................................20
Section 3.07. Allocation of Expenses and Indemnification...............21
Section 3.08. Insurance Policies.......................................22
ARTICLE FOUR
PAYMENTS; TRUST ACCOUNTS
Section 4.01. Payments from Trust Assets Only..........................23
Section 4.02. Trust Accounts...........................................23
Section 4.03. Distribution of Funds; Default with Respect to
UTI Pledge.............................................24
Section 4.04. SUBI Lease Accounts......................................24
i
<PAGE> 3
Page
----
ARTICLE FIVE
THE TRUSTEE
Section 5.01. Duties and Powers of Trustee.............................25
Section 5.02. Duty of Care.............................................26
Section 5.03. Certain Matters Affecting the Trustee....................27
Section 5.04. Trustee Not Liable for Certificates or Leases............28
Section 5.05. Indemnification of Trustee and Trust Agents..............29
Section 5.06. Trustee's Right Not to Act...............................29
Section 5.07. Qualification of Trustee.................................30
Section 5.08. Resignation or Removal of Trustee........................30
Section 5.09. Successor Trustee........................................31
Section 5.10. Merger or Consolidation of Trustee.......................31
Section 5.11. Co-Trustees, Separate Trustees, Nominee and Trust
Agents.................................................31
Section 5.12. Representations, Warranties and Covenants of Trustee.....34
Section 5.13. Trustee's Fees and Expenses..............................35
Section 5.14. Trustee Stock............................................35
Section 5.15. Limitation of Liability of Trustee.......................36
ARTICLE SIX
THE ADMINISTRATIVE AGENT
Section 6.01. Duties of the Administrative Agent.......................37
Section 6.02. Liability of Administrative Agent; Indemnities...........38
Section 6.03. Merger of Administrative Agent; Appointment of Nominee...39
Section 6.04. Limitation on Liability of Administrative Agent
and Others.............................................39
Section 6.05. Administrative Agent Not to Resign; Delegation
of Duties.............................................39
Section 6.06. Servicing Compensation...................................40
Section 6.07. Powers of Attorney.......................................40
Section 6.08. Protection of Title to Trust.............................41
ARTICLE SEVEN
TERMINATION AND DISSOLUTION
Section 7.01. Dissolution of the Trust.................................42
Section 7.02. Termination of Sub-Trusts................................42
Section 7.03. Beneficiary or Special Purpose Affiliate Bankruptcy......43
ii
<PAGE> 4
Page
----
ARTICLE EIGHT
MISCELLANEOUS
Section 8.01. Amendment................................................44
Section 8.02. Governing Law............................................44
Section 8.03. Notices..................................................44
Section 8.04. Severability of Provisions...............................45
Section 8.05. Counterparts.............................................45
Section 8.06. Successors and Assigns...................................45
Section 8.07. No Petition..............................................45
Section 8.08. Table of Contents and Headings...........................46
Section 8.09. Tax Reporting and Characterization.......................46
Section 8.10. Certificates Nonassessable and Fully Paid................46
ARTICLES NINE AND TEN
[Reserved]
Signatures...................................................................48
EXHIBITS
Exhibit A - Form of Certificate of Trust..................................A-1
Exhibit B - UTI Certificate...............................................B-1
iii
<PAGE> 5
SECOND AMENDED AND RESTATED TRUST AGREEMENT
This Second Amended and Restated Trust Agreement, dated as of February
1, 1998 (the "Agreement"), is among Ryder Truck Rental I LP and Ryder Truck
Rental II LP, each a Delaware limited partnership, as grantors and initial
beneficiaries (in such capacities, the "Grantors" and the "UTI Beneficiaries",
respectively), Ryder Truck Rental, Inc., a Florida corporation, as
administrative agent (the "Administrative Agent"), RTRT, Inc., a Delaware
corporation, as trustee (the "Trustee"), Delaware Trust Capital Management,
Inc., a Delaware banking corporation, as Delaware trustee, and, for the limited
purposes set forth herein, U.S. Bank National Association, a national banking
association ("U.S. Bank"), as trust agent (the "Trust Agent").
RECITALS
WHEREAS, Ryder Truck Rental LT, a Delaware business trust, has been
created pursuant to (i) a trust agreement, dated as of June 1, 1997, among the
Grantors and UTI Beneficiaries, the Administrative Agent and the Trustee, as
amended and restated by an amended and restated trust agreement, dated as of
August 1, 1997 (the "Original Trust Agreement"), among the Grantors and UTI
Beneficiaries, the Administrative Agent, the Trustee and Delaware Trust Capital
Management, Inc., as Delaware trustee, and (ii) a certificate of trust filed
with the Secretary of State of the State of Delaware on July 24, 1997; and
WHEREAS, the parties hereto desire to amend and restate the Original
Trust Agreement in its entirety for the purpose of taking assignments and
conveyances of and holding in trust various assets described herein.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions. Whenever used herein, unless the context
otherwise requires, the following words and phrases shall have the following
meanings:
"Administration Agreement" means any administration agreement, as
amended, restated or supplemented from time to time.
"Administration Supplement" means either a UTI Administration
Supplement or a SUBI Administration Supplement, as the context may require.
<PAGE> 6
"Administrative Agent" means the entity named as such in an
Administration Agreement and its permitted successors and assigns.
"Affected Trust Assets" has the meaning set forth in Section 3.07(b).
"Affiliate" of any Person means any other Person that (i) directly or
indirectly controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any employee benefit plan) or (ii) is an officer, director,
member or partner of such Person. For purposes of this definition, a Person
shall be deemed to be "controlled by" another Person if such other Person
possesses, directly or indirectly, the power (i) to vote 5% or more of the
securities (on a fully diluted basis) having ordinary voting power for the
election of directors, members or managing partners of such Person or (ii) to
direct or cause the direction of the management and policies of such Person,
whether by contract or otherwise.
"Agreement" means this Second Amended and Restated Trust Agreement, as
amended, restated or supplemented from time to time.
"Base Jurisdiction" means, in the case of Vehicles registered under
the IRP, the jurisdiction in which such Vehicle is registered pursuant to the
IRP.
"Beneficiaries" means, collectively, the Related Beneficiaries of all
Sub-Trusts, and "Beneficiary" means any of such Beneficiaries.
"Business Day" means any day other than a Saturday, Sunday or a day on
which banking institutions in the States of Delaware, Florida, Illinois or New
York are authorized or obligated by law, executive order or government decree
to be closed.
"Capital Contribution" means any capital contribution to the Trust
made by a Beneficiary, the Administrative Agent or any of their respective
Affiliates.
"Cash Value" means, with respect to any Trust Assets on any date, the
sum of all cash and the Net Book Values of the Vehicles comprising such Trust
Assets on such date.
"Certificate" means a UTI Certificate or a SUBI Certificate, as the
context may require.
"Certificate of Title" means a certificate of title or other evidence
of ownership of a Vehicle issued by the Registrar of Titles in (i) the
jurisdiction in which such Vehicle is registered or (ii) in the case of
Vehicles registered under the IRP, the Base Jurisdiction.
"Certificate of Trust" means the certificate of trust for the Trust,
substantially in the form of Exhibit A, filed with the office of the Delaware
Secretary of State pursuant to Section 3810 of the Delaware Act.
"Claims" means all liabilities, claims and expenses (including
reasonable legal and other professional fees and expenses).
2
<PAGE> 7
"Co-Trustee Agreement" means any instrument or agreement pursuant to
which the Trustee appoints a co-trustee pursuant to Section 5.07(b).
"Code" means the Internal Revenue Code of 1986, as amended.
"Collection Account" means, with respect to any Sub-Trust, the account
created, designated and maintained as such pursuant to Section 4.02(a).
"Control" has the meaning set forth in Section 8-106 of the UCC.
"Cutoff Date" shall have the meaning set forth in the related
Supplement.
"Delaware Act" means the Delaware Business Trust Act, specifically,
the provisions of 12 Del. C. ss. 3801 et seq., as amended.
"Delaware Secretary of State" means the Secretary of State of the
State of Delaware.
"Delaware Trustee" means the trustee meeting the requirements of
Section 3807 of the Delaware Act and designated in the Certificate of Trust
(and its successors), in such capacity as set forth in the Certificate of
Trust, and shall initially be Delaware Trust Capital Management, Inc.
"Disposition Expenses" shall have the meaning set forth in the related
Administration Agreement.
"Duff & Phelps" means Duff & Phelps Credit Rating Co., and its
successors.
"Effective Date" means February 1, 1998.
"Eligible Lease" means a Lease as to which the following are true as
of the date such Lease is assigned to the Trust:
(i) was originated in the United States by Ryder for a Lessee
with a United States address in the ordinary course of Ryder's
business;
(ii) is a United States dollar-denominated obligation;
(iii) has been (or, within any applicable Titling Grace Period,
will be) validly assigned to the Trust by Ryder;
(iv) provides for Fixed Charge payments to be made by the related
Lessee over the Lease Term;
(v) is a Lease as to which no selection procedure was used that
was believed to be adverse to any Holders;
3
<PAGE> 8
(vi) was created in compliance in all material respects with all
applicable federal and state laws, including disclosure laws;
(vii) (A) is the legal, valid and binding payment obligation of
the related Lessee, enforceable against such Lessee in accordance with
its terms, as amended, (B) has not been satisfied, subordinated,
rescinded, canceled or terminated, (C) is a Lease as to which no right
of rescission, setoff, counterclaim or defense has been asserted or
threatened in writing and (D) is a Lease as to which no written
default notice has been transmitted to Ryder;
(viii) has an original term of not less than 12 months and a
remaining term of not greater than 120 months;
(ix) is a Lease as to which an executed copy of the documentation
associated therewith is located at Ryder's business premises;
(x) is a Lease as to which Ryder has retained, or the related
Lessee has obtained, physical damage insurance covering the risk of
loss or damage to the related Vehicle as required under such Lease;
(xi) is a Lease as to which Ryder or the related Lessee has
obtained liability insurance covering the related Vehicle as required
under such Lease;
(xii) does not have a Total Monthly Payment that is more than 60
days past due; and
(xiii) has not had any Liens or Claims filed on or against it for
work, labor or materials.
"Entitlement Holder" has the meaning set forth in Section 8-102(a)(7)
of the UCC.
"Event of Default" means any event of default (after the expiration of
any applicable notice or cure periods), as such term (or similar term) is
defined in any Administration Agreement or any Securitized Financing Document.
"Excess Funds" means, as of any date of determination, the amount of
monies on deposit in all UTI Accounts or otherwise held by the Trustee in
respect of the UTI in excess of the amount required to (i) meet all existing
Liabilities of the Trust to be paid by or on behalf of the Holders of the UTI
Certificates or the UTI Beneficiaries (after taking into account any transfers
from one or more SUBI Accounts to the UTI Collection Account to be made on such
date) and (ii) be retained as reserves for reasonably anticipated Liabilities
of the Trust (after taking into account all transfers to be made from any such
SUBI Accounts to the UTI Collection Account in respect of such SUBI's
proportionate share of such anticipated Liability).
"FDIC" means the Federal Deposit Insurance Corporation, and its
successors.
4
<PAGE> 9
"Financial Component" means the portion of the Fixed Charge component
of Total Monthly Payments with respect to each Lease representing the financing
cost and depreciation of the related Vehicle.
"Fitch" means Fitch IBCA, Inc., and its successors.
"Fixed Charge" means, with respect to a Lease, the component of Total
Monthly Payments that is a fixed dollar amount due every month during the Lease
Term regardless of the actual usage of the related Vehicle by the related
Lessee.
"FNMA" means the Federal National Mortgage Association, and its
successors.
"Grantor" has the meaning set forth in the Preamble.
"Holder" means, with respect to any Certificate, the Person listed in
the registration books maintained by the Trustee pursuant to Section 3.04(a) as
the registered owner thereof; provided, that a Registered Pledgee shall be
entitled to exercise any or all of the rights or powers of a Holder of a
Certificate hereunder, including receiving distributions, providing notices or
giving consents, to the extent such entitlement is set forth in such Holder's
registration of pledge or the documents relating to such pledge.
"Insurance Expenses" means any Insurance Proceeds (i) applied to the
repair of a Vehicle, (ii) released to the related Lessee in accordance with
applicable law or the customary servicing procedures of the Administrative
Agent or (iii) representing other related expenses incurred by the
Administrative Agent not otherwise included in Disposition Expenses and
recoverable by the Administrative Agent under an Administration Agreement.
"Insurance Policy" means, with respect to any Lease, Lessee or
Vehicle, any policy (including any self-insurance) of comprehensive, collision,
public liability, physical damage, personal liability, credit health or
accident, credit life or employment insurance, or any other form of insurance
or self-insurance.
"Insurance Proceeds" means, with respect to any Vehicle, Lease or
Lessee, recoveries paid to the Administrative Agent, the Trust or the Trustee
on behalf of the Trust under an Insurance Policy and any rights thereunder or
proceeds therefrom (including any self-insurance).
"IRP" means the International Registration Plan, as in effect in the
respective jurisdiction.
"Issuer" shall have the meaning set forth in the related Securitized
Financing Documents.
"Lease" means any lease contract that has been assigned to the Trust,
as such lease contract pertains to a particular Vehicle, consisting of a Truck
Lease and Service Agreement between the Lessor and Lessee and a Schedule A
thereto listing the vehicle identification number and other information
regarding such Vehicle; provided, however, that the UTI Master Lease shall not
be a Lease for purposes of this definition.
"Lease Term" means the term of each Lease.
5
<PAGE> 10
"Lessee" means each Person that is a lessee under a Lease, including
any Person that executes a guarantee on behalf of such lessee.
"Lessor" means each Person that is the lessor under a Lease or the
assignee thereof, including the Trust.
"Liability" means any liability or expense, including any
indemnification obligation.
"Lien" means any security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than tax liens, mechanics' liens, any liens that
attach to property by operation of law and statutory purchase liens to the
extent not past due.
"Liquid Trustee Assets" means the face value of any cash or cash
equivalents held by the Trustee for its own account, up to but not exceeding
its net worth as set forth on its financial books and records.
"Loss" means any loss, liability, claim, damage or reasonable expense,
including reasonable fees and expenses of counsel and reasonable expenses of
litigation.
"Moody's" means Moody's Investors Service, Inc., and its successors.
"Net Book Value" means, with respect to a Vehicle, the value of such
Vehicle on Ryder's books.
"99% UTI Beneficiary" means the UTI Beneficiary to which the UTI
Certificate representing a 99% ownership interest in the UTI is initially
issued and its permitted successors and assigns, including the UTI Beneficiary
of any UTI Certificate evidencing a lesser remaining ownership interest in the
UTI following the transfer of a portion of such UTI Certificate to an
additional 1% UTI Beneficiary designated pursuant to Section 7.03(b).
"Officer's Certificate" means a certificate signed by the Chairman of
the Board of Directors, the President, any Vice President, the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant Secretary of any specified
Person (which, in the case of (i) a limited liability company, shall be any of
the foregoing officers of a member or (ii) a partnership, shall be any of the
foregoing officers of the managing general partner or, if there is no managing
general partner, any general partner) and delivered to any other specified
Person.
"1% UTI Beneficiary" means the UTI Beneficiary to which the UTI
Certificate representing the 1% ownership interest in the UTI is initially
issued, and its permitted successors and assigns, or any additional UTI
Beneficiary to which a UTI Certificate representing a 1% ownership interest in
the UTI is issued pursuant to Section 7.03(b).
"Opinion of Counsel" means a written opinion of counsel who may,
except as otherwise expressly provided in the Trust Documents or related
Securitized Financing Documents, be counsel for a Beneficiary, the
Administrative Agent or any of their respective Affiliates (including, in each
case, in-house counsel), which counsel, in the case of opinions delivered to
the Trustee, shall be reasonably satisfactory to the Trustee.
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"Original Trust Agreement" has the meaning set forth in the Recitals.
"Other SUBI" means, with respect to a SUBI, any SUBI other than such
SUBI.
"Other SUBI Assets" means all Trust Assets allocated to an Other SUBI.
"Other SUBI Certificate" means a SUBI Certificate relating to an Other
SUBI.
"Permitted Investments" means, at any time with respect to a
Sub-Trust, any one or more of the following obligations, instruments and
securities:
(i) obligations of, and obligations fully guaranteed as to timely
payment of principal and interest by, the United States or any agency
thereof, provided such obligations are backed by the full faith and
credit of the United States;
(ii) general obligations of or obligations guaranteed by FNMA or
any State; provided that, if any related Rated Securities are
outstanding, such obligations have the highest available credit rating
from each Rating Agency for such obligations;
(iii) securities bearing interest or sold at a discount issued by
any corporation incorporated under the laws of the United States or of
any State; provided, that if any related Rated Securities are
outstanding at the time of such investment or contractual commitment
providing for such investment, either (a) the long-term unsecured debt
of such corporation has the highest available rating from each Rating
Agency for such obligations or (b) the commercial paper or other
short-term debt of such corporation that is then rated has the highest
available credit rating of each Rating Agency for such obligations;
(iv) certificates of deposit issued by any depository institution
or trust company (including the Trust Agent or, if there is no Trust
Agent, the Trustee) incorporated under the laws of the United States
or any State and subject to supervision and examination by banking
authorities of one or more of such jurisdictions; provided that, if
any related Rated Securities are outstanding, the short-term unsecured
debt obligations of such depository institution or trust company has
the highest available credit rating of each Rating Agency for such
obligations;
(v) certificates of deposit that are issued by any bank, trust
company, savings bank or other savings institution and fully insured
by the FDIC;
(vi) investments in money market funds (including funds for which
the Trustee, the Trust Agent or any of their respective Affiliates is
investment manager or advisor) having a rating from Standard & Poor's
of AAA-m or AAAm-G and from Moody's of Aaa;
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(vii) repurchase obligations held by the Trustee or, if there is
a Trust Agent, by the Trust Agent, with respect to any obligation or
security described in clauses (i), (ii) or (viii) hereof or any other
obligation or security issued or guaranteed by any other agency or
instrumentality of the United States, in either case entered into with
a federal agency or a depository institution or trust company (acting
as principal) described in clause (iv) above; and
(viii) such other obligations, instruments and securities as may
be directed by the Administrative Agent; provided, that if any Rated
Securities are outstanding, such obligations, instruments and
securities shall be acceptable to each Rating Agency, as evidenced by
a letter from each Rating Agency to the Trustee to the effect that the
making of such investments will not result in the qualification,
downgrading or withdrawal of the rating then assigned to any Rated
Securities by such Rating Agency;
provided, that except as provided in a related Supplement or Administration
Agreement, each of the foregoing obligations, instruments and securities shall
mature no later than the Business Day prior to the date on which such funds are
required to be available for application pursuant to any related Trust Document
or Securitized Financing Document (other than in the case of the investment of
monies in obligations, instruments and securities of which the entity at which
the related account is located is the obligor, which may mature on such date),
and shall be required to be held to such maturity.
Notwithstanding the foregoing, (i) no Permitted Investment may be
purchased at a premium and (ii) no obligation or security may be a "Permitted
Investment" unless (a) the Trustee has Control over such obligation or security
and (b) at the time such obligation or security was delivered to the Trustee or
the Trustee became the related Entitlement Holder, the Trustee did not have
notice of any adverse claim with respect thereto within the meaning of Section
8-105 of the UCC.
For purposes of this definition, any reference to the highest
available credit rating of an obligation shall mean the highest available
credit rating for such obligation (excluding any "+" signs associated with such
rating) or such lower credit rating (as approved in writing by each Rating
Agency) as will not result in the qualification, downgrading or withdrawal of
the rating then assigned to the Rated Securities relating to a particular
Securitized Financing by such Rating Agency.
"Person" means any legal person, including any individual,
corporation, partnership, joint venture, association, limited liability
company, joint stock company, trust, business trust, bank, trust company,
estate (including any beneficiaries thereof), unincorporated organization or
government or any agency or political subdivision thereof.
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"Proceeding" means any suit or action at law or in equity or any other
judicial or administrative proceeding, including any bankruptcy proceeding.
"Rated Securities" means, with respect to a Securitized Financing,
each class or series of Securities that has been rated by one or more Rating
Agencies at the request of a Grantor, a Beneficiary or any of their respective
Affiliates.
"Rating Agency" means each nationally recognized rating agency that
issues a rating on Rated Securities at the request of a Grantor, a Beneficiary
or any of their respective Affiliates, as identified in a related Supplement.
"Registered Pledgee" means, with respect to any Certificate, the
Person listed in the registration books maintained by the Trustee pursuant to
Section 3.04(a) as the registered pledgee of such Certificate.
"Registrar of Titles" means the applicable department, agency or
official in a State responsible for accepting applications and maintaining
records relating to Certificates of Title and Liens thereupon.
"Related Beneficiary" means, with respect to (i) the UTI, the UTI
Beneficiaries and (ii) a SUBI, the Person or Persons designated as a
Beneficiary of such SUBI in the related SUBI Supplement, in each case together
with their permitted successors and assigns.
"Related Trust Assets" means, with respect to a Sub-Trust, the related
Leases, Vehicles and other Trust Assets held by the Trust as nominee holder of
legal title for the benefit of the Related Beneficiary and the Holders of the
related Certificates.
"Rental Vehicle" means a Vehicle that is not subject to a Lease.
"Required Deposit Rating" means, with respect to any entity, that (i)
the short-term unsecured debt obligations of such entity are rated in the
highest short-term rating category by each Rating Agency or (ii) such entity is
a depository institution or trust company having a long-term unsecured debt
rating acceptable to each Rating Agency and corporate trust powers and the
related Trust Account is maintained in the corporate trust department of the
related entity.
"Residual Value" means, (i) for Vehicles subject to a Lease (a)
represented by a SUBI, the estimated sales proceeds at the related Maturity
Date as determined on or before the appropriate Cutoff Date for such SUBI or
(b) not represented by a SUBI, the salvage value at the related Maturity Date
as recorded by Ryder on Ryder's books and records or (ii) for Rental Vehicles,
the salvage value at the end of such Rental Vehicle's depreciable life as
recorded by Ryder on Ryder's books and records.
"Responsible Officer" means, when used with respect to the Trustee or
a Trust Agent, any officer in the corporate trust office of the Trust Agent or,
if there is no Trust Agent, the corporate trust office of the Trustee,
including any president, vice president, assistant vice president, trust
officer, secretary, assistant secretary or any other officer thereof
customarily performing functions similar to those performed by the individuals
who at the time shall be such officers, respectively, or to whom any corporate
trust matter is referred because of his or her knowledge of or familiarity with
the particular subject.
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"Ryder" means Ryder Truck Rental, Inc., and its successors.
"Schedule A" means the schedule that, combined with a TL&SA,
constitutes a Lease.
"Schedule of Vehicles" means the microfiche, microfilm or paper list
of Leases and Vehicles that are included as Trust Assets, as such list may be
revised and supplemented from time to time pursuant to Section 6.01, and which
shall set forth, to the extent applicable, the following information with
respect to each such Lease and Vehicle in separate columns:
Vehicle Number Assigned by Ryder
Vehicle Identification Number
Fixed Charge
Financial Component
Net Book Value
Residual Value
Sub-Trust to which Vehicle is assigned
"Securitization Holder" means any entity that, in connection with a
Securitized Financing, becomes a Holder by being, pursuant to the related
Securitized Financing Documents, the Holder (or a Registered Pledgee authorized
to exercise certain rights of a Holder) of a Certificate solely in a trust
capacity.
"Securitized Financing" means any (i) financing transaction undertaken
by a Beneficiary or a Special Purpose Affiliate that is secured, directly or
indirectly, by Trust Assets or the UTI, a SUBI or any interest therein and any
financing undertaken in connection with the issuance, pledge or assignment of
the UTI or a SUBI and the related Certificate, (ii) sale, lease or other
transfer by a Beneficiary or a Special Purpose Affiliate of an interest in the
UTI or a SUBI or (iii) other asset securitization, secured loan or similar
transaction involving Trust Assets or any beneficial interest therein or in the
Trust.
"Securitized Financing Documents" means, with respect to a Securitized
Financing, each indenture, trust agreement, pooling and servicing agreement,
administration agreement, servicing agreement, program operating lease,
assignment or transfer agreement and each other operative document relating to
such Securitized Financing.
"Security" means, with respect to a Securitized Financing, any
security issued by or on behalf of the related Issuer.
"Special Purpose Affiliate" means a special purpose entity that is an
Affiliate of a Beneficiary and was created for the purpose of one or more
Securitized Financings.
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"Standard & Poor's" means Standard & Poor's, a division of The
McGraw-Hill Companies, Inc., and its successors.
"State" means any state of the United States, Puerto Rico or the
District of Columbia.
"Sub-Trust" has the meaning set forth in Section 3.01(b).
"SUBI" has the meaning set forth in Section 3.01(a).
"SUBI Account" means each Trust Account created with respect to a
particular SUBI.
"SUBI Administration Supplement" means any supplement or amendment to
an Administration Agreement entered into from time to time relating to a SUBI
or SUBI Certificate, which supplement or amendment sets forth any special
responsibilities or obligations the Administrative Agent may be required to
undertake in connection therewith.
"SUBI Assets" means the SUBI Leases and SUBI Vehicles and all proceeds
arising therefrom or in connection therewith.
"SUBI Certificate" has the meaning set forth in Section 3.02(a).
"SUBI Collection Account" means a Collection Account established
pursuant to Section 4.02(a) with respect to a SUBI.
"SUBI Lease" means a Lease that has been allocated to a SUBI pursuant
to a Securitized Financing.
"SUBI Lease Account" has the meaning set forth in Section 4.04.
"SUBI Supplement" means any supplement or amendment to this Agreement
executed from time to time in connection with the creation and issuance of a
particular SUBI.
"SUBI Vehicle" means a Vehicle that has been allocated to a SUBI
pursuant to a Securitized Financing.
"Subsidiary" means any corporation or other entity, with respect to
which capital stock or other ownership interests having ordinary voting power
to elect a majority of the board of directors, members or other Persons
performing similar functions, is at the time directly or indirectly owned by
the Trust Agent either directly or through Subsidiaries.
"Supplement" means either a UTI Supplement or a SUBI Supplement.
"Tax" or "Taxes" means any and all taxes, including but not limited
to, net income, franchise, value added, ad valorem, gross income, gross
receipts, sales, use, property (personal and real and tangible and intangible),
stamp taxes, levies, imposts, duties, charges, assessments or withholdings of
any nature whatsoever, together with any and all penalties, fines, additions to
tax and interest imposed by any federal, state, local or foreign government or
political subdivision thereof.
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"Titling Grace Period" means, with respect to a Sub-Trust, the period
of time by the end of which any related Vehicles that are not yet titled in the
name of the Trust or the Trustee on behalf of the Trust must be titled in the
name of the Trust or in the name of the Trustee on behalf of the Trust as set
forth in the related Supplement in order to be included in such Sub-Trust. If a
Supplement does not contain a Titling Grace Period, no such grace period shall
apply with respect to the related Sub-Trust and the Related Trust Assets.
"Total Monthly Payment" means, with respect to any Lease, the total
monthly payment payable by the related Lessee under such Lease.
"Truck Lease and Service Agreement" or "TL&SA" means a single unitary
contract between Ryder and the Lessee that, when taken together with a Schedule
A, requires such Lessee, among other things, to make monthly payments for a
predetermined number of months in exchange for the use of one or more Vehicles
covered by such contract.
"Trust" means Ryder Truck Rental LT, and its successors.
"Trust Account" means a Collection Account, a SUBI Lease Account or
such other account as may be specified in a related Supplement or
Administration Agreement, as the context may require.
"Trust Agency Agreement" means an agency agreement entered into
pursuant to Section 5.11(d) between the Trustee and a Trust Agent pursuant to
which a Trust Agent is appointed by the Trustee.
"Trust Agent" means U.S. Bank, in its capacity as initial Trust Agent,
and any other Person with which the Trustee contracts to act as its agent with
respect to carrying out its duties pursuant to a Trust Agency Agreement.
"Trust Asset Transfer" means the allocation, in connection with a
Securitized Financing and in accordance with the terms of the related
Securitized Financing Documents, of any Leases and Vehicles from previously
unallocated Trust Assets to a SUBI after such SUBI's initial creation;
provided, that such allocation will not, in and of itself, cause or result in
an Event of Default under such Securitized Financing Documents.
"Trust Assets" means UTI Assets or SUBI Assets, as the context may
require.
"Trust Documents" means this Agreement, the Certificate of Trust, any
Supplement, any Administration Agreement, any Administration Supplement, any
Co-Trustee Agreement and any Trust Agency Agreement.
"Trust Expenses" means, for any period, all expenses of the Trust
other than servicing compensation payable to and expenses incurred by the
Administrative Agent, including fees and expenses of the Trustee, any
co-trustee, separate trustee or nominee holder of legal title, the Trust Agent
and the Delaware Trustee (excluding Taxes payable in respect of income earned
by any thereof), and, if not paid by the Administrative Agent, Insurance
Expenses and Taxes relating to Trust Assets, in each case incurred during or
with respect to such period.
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"Trust Office" means the principal office of the Trust, which
initially shall be in care of the Administrative Agent at 3600 N.W. 82nd
Avenue, Miami, Florida 33166.
"Trustee" means RTRT, Inc., a Delaware corporation, as trustee of the
Trust, and its successors.
"Trustee Stock" means the issued and outstanding capital stock of the
Trustee as of the Effective Date, together with any additional capital stock of
the Trustee that may be issued from time to time thereafter.
"UCC" means the Uniform Commercial Code as in effect in the applicable
jurisdiction.
"United States" means the United States of America, its territories
and possessions and areas subject to its jurisdiction.
"U.S. Bank" has the meaning set forth in the Preamble.
"UTI" has the meaning set forth in Section 3.01(a).
"UTI Account" means each Trust Account created with respect to the
UTI.
"UTI Administration Supplement" means any supplement or amendment to
an Administration Agreement entered into from time to time relating to the UTI
or a UTI Certificate, which supplement or amendment sets forth any special
responsibilities or obligations the Administrative Agent may be required to
undertake in connection therewith.
"UTI Assets" means: (i) cash capital; (ii) UTI Vehicles (excluding any
proceeds arising therefrom or in connection therewith, unless such proceeds
arise from UTI Leases); (iii) UTI Leases and all of Ryder's rights as Lessor
thereunder, including the right to proceeds arising therefrom or in connection
therewith; provided, however, that the Trust shall assign the right to all such
proceeds to Ryder; and (iv) the Trust's rights as lessor under the UTI Master
Lease, including rights to receive all rental payments owed to the lessor
thereunder.
"UTI Beneficiary" means (i) Ryder Truck Rental I LP or Ryder Truck
Rental II LP, each a Delaware limited partnership, each in its capacity as an
initial beneficiary of the Trust, and its permitted successors and assigns or
(ii) any other UTI Beneficiary that becomes a party to this Agreement pursuant
to Section 7.03(b).
"UTI Certificates" has the meaning set forth in Section 3.03.
"UTI Collection Account" means, with respect to the UTI, the account
created, designated and maintained as such pursuant to Section 4.02(a).
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"UTI Lease" means a Lease that has not been allocated to a SUBI.
"UTI Master Lease" means that certain sale and lease agreement, dated
as of September 1, 1997, between Ryder, as lessee, and the Trust, as owner, as
amended, restated or supplemented from time to time.
"UTI Pledge" means a pledge of and a grant of a security interest in
the UTI, a UTI Certificate or any interest therein in connection with a
Securitized Financing.
"UTI Pledge Default Notice" means that the Trustee has actual
knowledge or has received notice from the Administrative Agent or the
Registered Pledgee of a UTI Pledge to the effect that there is a default with
respect to a Securitized Financing secured by such UTI Pledge.
"UTI Supplement" means any supplement or amendment to this Agreement
executed from time to time in connection with a UTI Pledge pursuant to Section
3.03.
"UTI Vehicle" means a Vehicle that has not been allocated to a SUBI.
"Vehicle" means a truck, tractor or trailer, together with all
accessories, parts and additions constituting a part thereof and all accessions
thereto, that is owned by the Trust.
Section 1.02. Interpretive Provisions. For all purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires, (i) terms used herein include, as appropriate, all genders
and the plural as well as the singular, (ii) references to this Agreement
include all Exhibits hereto, (iii) references to words such as "herein",
"hereof" and the like shall refer to this Agreement as a whole and not to any
particular part, Article or Section herein, (iv) references to an Article or
Section such as "Article One" or "Section 1.01" shall refer to the applicable
Article or Section of this Agreement, (v) the term "include" and all variations
thereof shall mean "include without limitation", (vi) the term "or" shall
include "and/or" and (vii) the term "proceeds" shall have the meaning ascribed
to such term in the UCC.
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ARTICLE TWO
THE TRUST
Section 2.01. General. The Trustee may engage, in the name of the
Trust or in its own name on behalf of the Trust, in the activities of the
Trust, make and execute contracts and other instruments on behalf of the Trust
and sue and be sued. The parties hereto intend that the Trust be a business
trust under the Delaware Act and that this Agreement shall constitute the
governing instrument of the Trust. The Trustee shall have all rights, powers
and duties set forth herein and in the Delaware Act with respect to
accomplishing the purposes of the Trust.
Section 2.02. Offices. The principal office of the Trust, and such
additional offices as the Trustee may establish, shall be located at such place
or places, inside or outside of the State of Delaware, as the Trustee may
designate from time to time by written notice to each Beneficiary, each Holder,
each Registered Pledgee and the Administrative Agent. Initially, such principal
office shall be in care of the Administrative Agent at the Trust Office.
Section 2.03. Purposes. The purposes of the Trust are: (i) at the
direction of the UTI Beneficiaries, to take assignments and conveyances of,
hold in trust and release its ownership interest in, the Trust Assets as
nominee holder of legal title for the benefit of the Beneficiaries and the
Holders, (ii) to engage in any of the other activities described or authorized
in this Agreement, any Supplement or any amendment hereto or thereto and (iii)
to engage in any and all activities that are necessary or appropriate to
accomplish the foregoing or that are incidental thereto or connected therewith.
The Trust shall not engage in any activity other than the foregoing or other
than as required or authorized by applicable law or the Trust Documents.
Section 2.04. Conveyance of Trust Assets.
(a) The UTI Beneficiaries shall from time to time assign, transfer,
grant or convey (or cause to be assigned, transferred, granted or conveyed) to
the Trust or the Trustee on behalf of the Trust, in trust, Eligible Leases,
Vehicles and other Trust Assets. In connection therewith, the Vehicles shall be
titled in the name of the Trust or the Trustee on behalf of the Trust and the
Trustee shall accept such designation and, subject to the other terms of this
Agreement (including each applicable Supplement), shall permit the related
Certificates of Title to be issued in the name of the Trust or the Trustee on
behalf of the Trust. If so provided in an applicable Supplement, all or part of
the Vehicles allocated to a Sub-Trust may be titled in the name of the Trust or
the Trustee on behalf of the Trust during a Titling Grace Period. Legal title
to all Trust Assets shall be vested in the Trust or the Trustee on behalf of
the Trust as a separate legal entity except to the extent otherwise
specifically provided herein or in any other Trust Document or where applicable
state law requires any Trust Asset to be vested otherwise, in which case the
Trustee shall, at the direction of the UTI Beneficiaries or the Administrative
Agent, cause legal title to be held as required thereby.
(b) The Trustee hereby accepts and agrees to hold in trust all Trust
Assets conveyed to it hereunder, for the use and benefit of, and as nominee
holder of legal title for, the Beneficiaries and the Holders and their
respective successors and assigns as may be designated pursuant to the terms
hereof or as may otherwise succeed to the rights of a Beneficiary or Holder
hereunder.
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Section 2.05. Document Execution and Performance. The Grantors and the
Beneficiaries hereby authorize and direct the Trustee, and the Trustee hereby
agrees, to: (i) at the request of the UTI Beneficiaries or the Administrative
Agent, execute and deliver all agreements, instruments or documents necessary
or advisable to accept the designation as nominee holder of legal title to
Leases, Vehicles and other Trust Assets as described herein and cause the
related Certificates of Title to be in the name of the Trust or the Trustee on
behalf of the Trust; (ii) take action that is required or authorized to be
taken by the Trustee pursuant to applicable law as specified in the Trust
Documents; (iii) exercise its rights and perform its duties as Trustee as
specified in the Trust Documents; (iv) at the direction of the Related
Beneficiary and the Administrative Agent (and, with respect to Trust Assets
that are the subject of a Securitized Financing, subject to any additional
requirements imposed by the related Securitized Financing Documents), (a)
release, discharge, sell, assign, transfer, pledge, convey or otherwise dispose
of any right, title or interest in and to any portion of the Related Trust
Assets, (b) amend or revoke the terms hereof with respect to all or any portion
of the Related Trust Assets and (c) enter into any agreements or instruments
affecting all or any portion of the Related Trust Assets or affecting any other
provision hereof; and (v) appoint the Administrative Agent as the
attorney-in-fact for the Trust as contemplated hereby or by any Administration
Agreement and direct the Administrative Agent to perform such administrative
duties on behalf of the Trust as are set forth herein and therein.
Section 2.06. Securitization Holders. To the extent that any entity
becomes a Securitization Holder, (i) such Securitization Holder shall exercise
its rights as a Holder hereunder only as directed or authorized pursuant to the
related Securitized Financing Documents and (ii) except with respect to a Claim
based on such Securitization Holder's willful misconduct, bad faith or
negligence, or to the extent otherwise expressly provided in such Securitized
Financing Documents, no recourse shall be had against the institution serving
as such Securitization Holder.
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ARTICLE THREE
BENEFICIAL INTERESTS IN THE TRUST
Section 3.01. Creation of UTI; UTI Pledges.
(a) Subject to Section 3.02, as directed in writing by the UTI
Beneficiaries from time to time, the Trustee shall establish one or more
"special units of beneficial interest" in the Trust (each, a "SUBI") and
allocate or cause to be allocated to each such SUBI on the books and records of
the Trust such SUBI Assets as shall be identified by the UTI Beneficiaries.
Each SUBI shall be established pursuant to a SUBI Supplement and shall have the
name and initial Related Beneficiary designated by the UTI Beneficiaries. The
Trustee shall hold the related SUBI Assets for the benefit of the Holders from
time to time of the related SUBI Certificates. All Trust Assets that have not
been allocated from time to time to a SUBI shall be identified on the books and
records of the Trust as being allocated to the beneficial interest in the Trust
constituting the "undivided trust interest" (the "UTI"). The Trustee shall hold
the UTI Assets for the benefit of the Holders from time to time of the UTI
Certificates.
(b) The UTI and each SUBI shall each constitute a separate series of
the Trust pursuant to Section 3806(b)(2) of the Delaware Act (each, a
"Sub-Trust"). The Administrative Agent shall maintain separate records for each
Sub-Trust, and the Related Trust Assets shall be held and accounted for
separately from Trust Assets allocated to any other Sub-Trust. Subject to the
right of the Trustee to allocate certain Liabilities, costs, charges and
reserves as may be provided in the Supplements, and in accordance with Section
3804(a) of the Delaware Act or to the extent otherwise permitted by applicable
law, all debts, Liabilities and obligations incurred, contracted for or
otherwise existing with respect to a Sub-Trust shall be enforceable against the
Related Trust Assets only, and not against Trust Assets allocated to any other
Sub-Trust. Every note, bond, contract or other undertaking issued by or on
behalf of a Sub-Trust (including each related Certificate) shall include a
recitation limiting the obligation represented thereby to the related Sub-Trust
and the Related Trust Assets. The Certificate of Trust shall include notice of
the limitation of liabilities of each Sub-Trust in accordance with Section
3804(a) of the Delaware Act. Except as otherwise provided for in this Agreement
or a Supplement, all payments made on or in respect of the Trust Assets
allocated to each Sub-Trust shall be paid to or upon the order of the Holders
of Certificates relating to such Sub-Trust.
(c) Except as provided in Section 7.03(b), neither the UTI nor any UTI
Certificate shall be transferred or assigned and, to the fullest extent
permitted by applicable law, any such purported transfer or assignment shall be
deemed null, void and of no effect under this Agreement. Notwithstanding the
foregoing, the UTI or one or more UTI Certificates may be pledged in connection
with a Securitized Financing, and a security interest therein granted, and may
be transferred or assigned absolutely to or by the pledgee thereof solely in
connection with the exercise of remedies with respect to an Event of Default
under or with respect to such Securitized Financing; provided, that any such
pledgee must (i) give a non-petition covenant substantially similar to that set
forth in Section 8.07 and (ii) execute an agreement in favor of the Holders
from time to time of any SUBI Certificates to release all Claims to the related
SUBI Assets and, in the event that such release is not given effect, to fully
subordinate all Claims such pledgee may be deemed to have against such SUBI
Assets.
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Section 3.02. SUBI Certificates.
(a) Upon allocation to a SUBI, the related SUBI Assets shall no longer
be UTI Assets unless and until reallocated to the UTI. Each SUBI shall
constitute a beneficial interest solely in the related SUBI Assets, and shall
be represented by one or more Certificates (each, a "SUBI Certificate") issued
pursuant to a SUBI Supplement. The Trustee shall deliver each SUBI Certificate
to or upon the order of the UTI Beneficiaries. Each SUBI Certificate and the
interest in the SUBI evidenced thereby shall constitute a "security" within the
meaning of Section 8-102(15) of the UCC.
(b) Notwithstanding anything to the contrary contained in this
Section, if a UTI Pledge exists, the Trustee shall create a new SUBI and issue
to or upon the order of the UTI Beneficiaries a new SUBI and one or more
related SUBI Certificates only (i) upon receipt of an Officer's Certificate of
the UTI Beneficiaries, dated as of the date of issuance of the related SUBI
Certificate, to the effect that after giving effect to the creation of such
SUBI, the transfer to the Related Beneficiary (and, if applicable, a Special
Purpose Affiliate) of any SUBI Certificate in connection therewith and the
application by such Related Beneficiary (and, if applicable, a Special Purpose
Affiliate) of any net proceeds from any Securitized Financing involving such
SUBI and SUBI Certificate, no Event of Default under any Securitized Financing
secured by a UTI Pledge has occurred and is continuing and (ii) provided that,
as of the date of issuance of such SUBI Certificate, the Trustee shall not have
received a UTI Pledge Default Notice.
(c) Each SUBI Certificate shall contain (i) an express waiver of any
Claim by the Holder thereof to any proceeds or assets of the Trustee and to all
Trust Assets other than those from time to time allocated to the related SUBI
as SUBI Assets and (ii) an express subordination in favor of the Holder of any
Other SUBI Certificate or a UTI Certificate by the Holder of such SUBI
Certificate of any Claim to any Other SUBI Asset or UTI Asset, respectively,
that, notwithstanding such waiver, may be determined to exist.
(d) No SUBI or SUBI Certificate shall be transferred or assigned
except to the extent specified in this Agreement or in any related Supplement
and, to the fullest extent permitted by applicable law, any such purported
transfer or assignment other than as so specified shall be deemed null, void
and of no effect under this Agreement. Notwithstanding the foregoing, any SUBI
Certificate and the interest in the SUBI evidenced thereby may be (i)
transferred, assigned or pledged to any Special Purpose Affiliate or (ii)
transferred, assigned or pledged by the Related Beneficiary or a Special
Purpose Affiliate to or in favor of (A) a trustee for one or more trusts or (B)
one or more other entities, in either case solely for the purpose of securing
or otherwise facilitating one or more Securitized Financings. Notwithstanding
the foregoing, the related transferee, assignee or pledgee in each case must
(i) give a non-petition covenant substantially similar to that set forth in
Section 8.07 and (ii) execute an agreement in favor of each Holder from time to
time of a UTI Certificate and any Other SUBI Certificate to release all Claims
to the UTI Assets and the related Other SUBI Assets, respectively, and, in the
event such release is not given effect, to fully subordinate all Claims it may
be deemed to have against the UTI Assets or such Other SUBI Assets, as the case
may be.
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(e) The UTI Beneficiaries shall at all times maintain a minimum
collective net worth (excluding the value of any UTI Certificates of which the
UTI Beneficiaries are the Holders) equal to 10% of the net Capital
Contributions made by all UTI Beneficiaries to the UTI. Each Related
Beneficiary and related Special Purpose Affiliate shall maintain such minimum
collective net worth or interest in a SUBI as may be required by the related
SUBI Supplement. For the purposes of this paragraph, all Trust Assets conveyed
as or acquired with the proceeds of Capital Contributions pursuant to Section
2.04(a) shall be deemed Capital Contributions to the Sub-Trust to which such
Trust Assets are allocated as of the date on which the related net worth
calculation is made.
(f) Each SUBI shall be created pursuant to a SUBI Supplement, which
shall amend this Agreement only with respect to the SUBI to which it relates.
Section 3.03. UTI Certificates. The UTI shall initially be represented
by two Certificates (the "UTI Certificates") respectively representing a 99%
(registered in the name of Ryder Truck Rental I LP) and a 1% (registered in the
name of Ryder Truck Rental II LP) ownership interest in the UTI. The Trustee
shall deliver to or upon the order of each UTI Beneficiary its respective UTI
Certificate. Notwithstanding the foregoing and subject to Section 3.01(c), at
the request of any UTI Beneficiary (but only with the consent of the Registered
Pledgee of any UTI Pledge), the UTI may be represented by one or more
additional Certificates that in the aggregate represent the entire UTI. Any
such additional Certificates shall be issued pursuant to a UTI Supplement,
which may specify any terms or conditions relevant to the issuance thereof.
Each UTI Certificate shall be substantially in the form of Exhibit B hereto,
with such appropriate insertions, omissions, substitutions and other variations
as are required by this Agreement, and may have such letters, numbers or other
marks of identification and such legends and endorsements consistent with this
Agreement as may be directed by the UTI Beneficiaries. Each UTI Certificate and
the interest in the UTI evidenced thereby shall constitute a "security" within
the meaning of Section 8-102(15) of the UCC. Any portion of a UTI Certificate
may be set forth on the reverse thereof, in which case the following text shall
be inserted on the face thereof, in relative proximity to and prior to the
signature of the Trustee executing such UTI Certificate:
Reference is hereby made to the further provisions of this UTI
Certificate set forth on the reverse hereof, which provisions shall
for all purposes have the same effect as if set forth at this place.
Each UTI Certificate shall be printed, lithographed, typewritten, mimeographed,
photocopied or otherwise produced in any manner as may, consistently with this
Agreement, be determined by the UTI Beneficiaries.
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Section 3.04. Registration and Transfer of Certificates; Validity.
(a) The Trustee shall keep or cause to be kept at the corporate trust
office of the Trustee (or the Trust Agent, if applicable) sufficient books for
the registration of transfer or pledge of Certificates, which shall at all
times be open to inspection by the Related Beneficiaries and the related
Holders. Subject to Sections 3.01(c) and 3.02(d) and any other restrictions on
transfer or pledge specified in a related Certificate or related Supplement,
upon presentation for such purpose, provided that the requirements of Section
8-401 of the UCC have been met, the Trustee shall, under such reasonable
regulations as it may prescribe, register or cause to be registered on such
books the transfer or pledge of such Certificate, accompanied by a written
instrument of transfer or pledge conforming to the requirements specified in
such Certificate, presented for registration of transfer or pledge by the
Holder thereof in conformity with such additional requirements as may be
specified in such Certificate.
(b) A Certificate bearing the manual or facsimile signatures of
individuals who were at the time such signatures were affixed authorized to
sign on behalf of the Trust shall be validly issued and entitled to the
benefits of this Agreement, notwithstanding that such individuals or any of
them shall have ceased to be so authorized prior to the authentication and
delivery of such Certificate or did not hold such offices at the date of such
Certificate.
Section 3.05. Beneficiaries; Action Upon Instruction.
(a) A Beneficiary may be a Holder of a Certificate relating to any
Sub-Trust and thereby acquire all rights accorded to a Holder under this
Agreement, any related Supplement or any other applicable Trust Document,
subject to such restrictions on voting or other rights as may be contained
therein.
(b) Subject to Article Five, each Beneficiary may direct the Trustee
to take action or refrain from taking action with respect to the Related Trust
Assets, except to the extent such action or inaction would conflict with any
other provision of this Agreement, the other Trust Documents or any related
Securitized Financing Documents. Such direction shall be accompanied by an
Officer's Certificate of such Beneficiary delivered to the Trustee certifying
that such direction is authorized by or not in conflict with this Agreement,
the other Trust Documents or any related Securitized Financing Documents. Such
action may include, among other things, delivering or distributing to or upon
the order of the Related Beneficiary all or any number of related Leases or
Vehicles or other Related Trust Assets.
Section 3.06. Filings. The Grantors, the Beneficiaries and the Trustee
shall undertake all other and future actions and activities as may be deemed
reasonably necessary by the Administrative Agent or a Related Beneficiary to
perfect (or evidence) and confirm the foregoing allocations of Trust Assets to
the UTI and any SUBIs, including filing or causing to be filed UCC financing
statements and executing and delivering any related filings, documents or
writings hereunder or under the other Trust Documents or any related
Securitized Financing Documents. Notwithstanding the foregoing, except as
otherwise provided in a Supplement or any related Securitized Financing
Documents, in no event shall the Grantors, any Beneficiary or the Trustee be
required to take any action to perfect (i) any allocation of UTI Assets in
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connection with a UTI Pledge or (ii) any security interest that may be deemed
to be held by any Person in any UTI Vehicle. The Grantors and the Beneficiaries
each hereby revocably makes and appoints each of the Trustee and the
Administrative Agent, and any of their respective officers, employees or
agents, as its true and lawful attorney-in-fact (which appointment is coupled
with an interest and is revocable but, in the case of the Administrative Agent,
only for so long as such Administrative Agent is acting in such capacity) with
power to sign on behalf of the Grantors or the Beneficiaries any financing
statements, continuation statements, security agreements, mortgages,
assignments, affidavits, letters of authority, notices or similar documents
necessary or appropriate to be executed or filed pursuant to this Section.
Section 3.07. Allocation of Expenses and Indemnification.
(a) Except as otherwise provided in a Supplement, the UTI
Beneficiaries shall be liable for all Liabilities arising with respect to the
UTI Assets or the operation of the UTI; provided, however, that any Liability
of the Grantors with respect to any Securitized Financing shall be as set forth
in the related Securitized Financing Documents. To the extent that a Grantor
(or its general partner, if such Grantor is a partnership) shall have paid or
suffered any Liability with respect to the UTI Assets or the operation of the
UTI, and to the extent such Liability was not caused by the willful misconduct
or bad faith of such Grantor (or such general partner, if such Grantor is a
partnership), such Grantor shall be indemnified, defended and held harmless out
of the UTI Assets in accordance with Section 3.07(b) against any such Liability
(including reasonable attorneys' and other professionals' fees and expenses).
(b) Notwithstanding any other provision of this Agreement or any other
Trust Document, to the extent that a Liability shall be incurred or suffered
with respect to, or is attributable to, any Trust Assets (the "Affected Trust
Assets") allocated to one or more Sub-Trusts, each such Sub-Trust shall, from
and to the extent of monies from time to time on deposit in the related
Collection Accounts, bear in full such Liability pro rata in the ratio of the
aggregate Cash Value of the Affected Trust Assets in all such Sub-Trusts and,
in accordance with Section 3804(a) of the Delaware Act, all other Sub-Trusts
shall bear none of such Liability; provided, however, that to the extent any
such Liability is suffered with respect to all Trust Assets generally, each
Sub-Trust shall, from and to the extent of monies from time to time on deposit
in the related Collection Accounts, bear such Liability in proportion to the
ratio of the aggregate Cash Value of the Trust Assets in such Sub-Trust to the
aggregate Cash Value of all Trust Assets. In each case in which more than one
Sub-Trust is to bear any such Liability, the Trustee shall, at the direction of
the Administrative Agent, transfer periodically from each related Collection
Account to the UTI Collection Account or such Trust Account as may be
designated by a related SUBI Supplement, as the case may be, the share of such
Liability borne by each such Sub-Trust.
(c) If, notwithstanding the provisions of this Agreement and Section
3804 of the Delaware Act, a third party Claim against the Trust Assets is
satisfied out of the Trust Assets in proportions other than as provided in
Section 3.07(b), then, notwithstanding anything to the contrary contained
herein, the Administrative Agent shall promptly identify and reallocate (or
cause the Trustee to identify and reallocate) the remaining Trust Assets among
each Sub-Trust such that each Sub-Trust shall bear the expense of such Claim as
nearly as possible as if such Claim had been allocated as provided in Section
3.07(b).
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Section 3.08. Insurance Policies.
(a) Except as otherwise provided in a Supplement, the Related
Beneficiary (or Special Purpose Affiliate, if applicable) shall cause to be
maintained, and no Beneficiary or Special Purpose Affiliate shall, without the
prior written consent of the Administrative Agent of the Related Trust Assets,
which consent may not be unreasonably withheld, cause the termination of one or
more excess liability or umbrella Insurance Policies providing coverage against
third party Claims that may be raised against the Trust, the Trustee on behalf
of the Trust or the Trust Agent with respect to each Vehicle, including vehicle
liability coverage in an amount at least equal to $5 million per occurrence
(which policy may be a blanket Insurance Policy covering the Related
Beneficiary or Special Purpose Affiliate, as applicable, and one or more
Affiliates).
(b) The Related Beneficiary or Special Purpose Affiliate, as
applicable, shall cause each Insurance Policy required to be maintained by it
pursuant to this Section to name the Trust or the Trustee on behalf of the
Trust as an additional insured or loss payee.
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ARTICLE FOUR
PAYMENTS; TRUST ACCOUNTS
Section 4.01. Payments from Trust Assets Only.
(a) Except as otherwise provided in this Agreement and the other Trust
Documents, all payments, if any, to be made by the Trustee other than amounts
(i) owing by the Trustee arising from its willful misfeasance, bad faith or
negligence or (ii) advanced by the Administrative Agent, shall be made only
from any then available Trust Assets, and only to the extent the Trustee shall
have received income or proceeds therefrom to make such payments in accordance
with the terms hereof.
(b) Except as otherwise provided in this Agreement and the other Trust
Documents, all amounts payable to a Holder shall be paid or caused to be paid
by the Trustee or the Administrative Agent, as the case may be, to or for the
account of such Holder in immediately available funds by wire transfer.
Section 4.02. Trust Accounts.
(a) The Trustee shall establish and maintain with respect to each
Sub-Trust (i) a collection account (each, a "Collection Account") and (ii) such
other Trust Accounts as are specified in a related Supplement or Administration
Agreement. Except as otherwise provided in a related Supplement or
Administration Agreement, each of such Trust Accounts shall be a segregated
trust account established and maintained with the Trustee or the Trust Agent in
the name of the Trustee, provided that the Trustee or the Trust Agent, as the
case may be, maintains the Required Deposit Rating. Except as otherwise
provided in this Agreement, the other Trust Documents and any applicable
Securitized Financing Documents, none of the Grantors, the Administrative
Agent, the Beneficiaries, any Special Purpose Affiliate or any Holder shall
have any right to withdraw funds from any Trust Account without the express
written consent of the Trustee; provided, however, that the Trustee, with the
express written consent of the Related Beneficiary or a Special Purpose
Affiliate (if applicable), shall so consent as to each Trust Account to the
extent provided for in any Supplement, Administration Supplement or related
Securitized Financing Documents. The Trustee may authorize the Related
Beneficiary, any Special Purpose Affiliate (if applicable) or any
Administrative Agent to make deposits into and disbursements from any Trust
Account in accordance with the terms and provisions of this Agreement, the
other Trust Documents and any related Securitized Financing Documents. All
amounts held in the Trust Accounts shall be invested by the Trustee at the
direction of the Administrative Agent in Permitted Investments until
distributed or otherwise applied in accordance with this Agreement, the other
Trust Documents or any related Securitized Financing Documents. Except as
otherwise provided herein or in a related Supplement or Administration
Agreement, all earnings from the investment of monies in a Trust Account shall
be deposited upon receipt into such Trust Account and any Loss on such
investment shall be charged to such Trust Account. If the Trustee or the Trust
Agent, as the case may be, at any time does not have the Required Deposit
Rating, the Administrative Agent shall, with the assistance of the Trustee or
the Trust Agent, as necessary, cause the related Trust Account to be moved to a
depository institution or trust company that (i) is organized under the laws of
the United States or any State and (ii) has the Required Deposit Rating.
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(b) Each SUBI Account shall relate solely to the related SUBI and each
UTI Account shall relate solely to the UTI, and any funds therein shall not be
commingled with any other monies, except as otherwise provided for or
contemplated in this Agreement, the other Trust Documents or any applicable
Securitized Financing Documents. The Trustee shall account for and record
separately all amounts received by the Trustee relating to each Trust Account
from the Related Trust Assets and proceeds relating thereto.
Section 4.03. Distribution of Funds; Default with Respect to UTI
Pledge.
(a) Except as otherwise provided in any Administration Agreement, the
Trustee, promptly upon receipt of an Officer's Certificate of the
Administrative Agent as to the amount of Excess Funds, shall pay to the Holders
of the UTI Certificates, upon the request of such Holders, any or all Excess
Funds so requested.
(b) In the event of a UTI Pledge Default Notice, the Trustee shall (i)
not create any new SUBI and (ii) direct the Administrative Agent to ensure that
no additional Leases or Vehicles are assigned to the Trust (other than (A) as
provided for in Section 4.04 or (B) those Leases and Vehicles the initial net
investment value of which on the books of the Trust does not exceed the sum of
any capital contributions made to the Grantors (and Capital Contributions made
by the Grantors) specifically to fund the acquisition by the Trust of such
Leases and Vehicles for allocation to the UTI).
Section 4.04. SUBI Lease Accounts. In the event that for any reason
(i)(a) one or more different Administrative Agents shall be engaged to service
one or more Sub-Trusts or (b) circumstances with respect to any Securitized
Financing secured by a UTI Pledge are such that (1) there has been a UTI Pledge
Default Notice or (2) the Trustee has given the Administrative Agent notice
that a Trust Asset Transfer into one or more SUBIs would cause an Event of
Default to occur in any Securitized Financing secured by such UTI Pledge and
(ii) at such time the Trustee, acting pursuant to any SUBI Supplement and at
the direction of the Related Beneficiary, would otherwise be causing the
Administrative Agent to effect Trust Asset Transfers from the UTI into one or
more SUBIs: (a) the Trustee shall establish and maintain in its name for each
SUBI a separate "SUBI Lease Account", each of which shall be a Trust Account
and a SUBI Account; (b) to the extent the Trustee would, but for clause (i)
above, cause the transfer of funds from any SUBI Collection Account to the UTI
Collection Account in connection with any Trust Asset Transfer, the Trustee
shall instead cause the transfer of such funds from such SUBI Collection
Account to the related SUBI Lease Account; (c) the Trustee shall direct the
Administrative Agent then servicing the related SUBI to acquire on behalf of
the Trust, for the account of such SUBI rather than for the UTI, Leases and
Vehicles; and (d) the Trustee shall apply any such funds in any such SUBI Lease
Account directly to reimburse the Administrative Agent then servicing such SUBI
for any payments made by it to honor drafts in respect of such Leases and
Vehicles. In the event Leases and Vehicles are being acquired by any
Administrative Agent on behalf of the Trust both with respect to the UTI and
any SUBI simultaneously, then the Trustee shall first allocate all such Leases
and Vehicles to such SUBI until funds available for such purpose in the related
SUBI Lease Account are exhausted, and shall then allocate all remaining Leases
and Vehicles to the UTI.
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ARTICLE FIVE
THE TRUSTEE
Section 5.01. Duties and Powers of Trustee.
(a) The Trustee undertakes to perform such duties and engage in such
activities, and only such duties and activities, as are specified in this
Agreement, in any other Trust Document or as may be directed from time to time
by the Related Beneficiary in a manner not contrary to the terms hereof or
thereof from time to time, including in connection with (i) a Securitized
Financing; (ii) sales or pledges of Leases, Vehicles and other Trust Assets to
the extent permitted by the terms of the related Securitized Financings
(provided that the Certificate of Title to any Vehicle so sold is amended to
reflect the transfer of ownership thereof from the Trust or the Trustee on
behalf of the Trust, unless applicable law permits the transfer of ownership of
a vehicle without an amendment to such vehicle's certificate of title); and
(iii) activities ancillary thereto. The Trustee shall have such powers as are
necessary and appropriate to the conduct of its duties as set forth in this
Agreement and any Supplement.
(b) Except as otherwise provided in this Agreement and the other Trust
Documents, neither the Trust nor the Trustee shall: (i) issue interests in or
securities of the Trust, other than the UTI, the UTI Certificates, one or more
SUBIs and any SUBI Certificates; (ii) borrow money, except from Ryder or the
UTI Beneficiaries in connection with funds used to acquire Leases and Vehicles;
(iii) make loans; (iv) invest in or underwrite securities; (v) offer securities
in exchange for Trust Assets (other than Certificates); (vi) repurchase or
otherwise reacquire any Certificate (other than for purposes of cancellation)
except as permitted by or in connection with any Securitized Financing; or
(vii) grant any security interest in or Lien upon any Trust Assets.
(c) At the direction of the Related Beneficiary or the Administrative
Agent, the Trustee shall undertake the following ministerial activities: (i)
apply for and maintain (or cause to be applied for and maintained) all
licenses, permits and authorizations necessary or appropriate to carry on its
duties as Trustee hereunder in each jurisdiction that the Related Beneficiary
or the Administrative Agent deems appropriate; (ii) when required by applicable
state law or administrative practice, file (or cause to be filed) applications
for Certificates of Title as are necessary or appropriate so as to cause the
Trust or the Trustee on behalf of the Trust to be recorded as the holder of
legal title of record to the Vehicles (and execute and deliver to the
Administrative Agent a power of attorney sufficient to allow the Administrative
Agent to so record the Trust or the Trustee on behalf of the Trust as the
holder of legal title to such Vehicles); (iii) file (or cause to be filed), in
each jurisdiction that the Related Beneficiary or the Administrative Agent
deems appropriate, notice reports and other required filings; (iv) be the
assignee of the original lessor with respect to the Leases; and (v) pay (or
cause to be paid) all applicable taxes and fees properly due and owing in
connection with the Trustee's activities. The Administrative Agent or the
Related Beneficiary, as applicable, shall pay, or make an advance to the
Trustee to pay, the costs and expenses of the foregoing, subject to
reimbursement to the extent provided in a related Administration Agreement.
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(d) The Trustee shall establish accounts and receive, maintain, invest
and disburse funds in accordance with Article Four and the other Trust
Documents.
(e) The Trustee, upon receipt of each resolution, certificate,
statement, opinion, report, document, order or other instrument furnished to
the Trustee as shall be specifically required to be furnished pursuant to any
provision of the Trust Documents, shall examine such instrument to determine
whether it conforms to the requirements of the Trust Documents.
(f) Neither the Administrative Agent nor any Beneficiary shall take,
or direct the Trustee to take, any action that (i) is inconsistent with the
purposes of the Trust as set forth in Section 2.03 or (ii) would result in the
treatment of the Trust for federal income tax purposes as an association (or a
publicly traded partnership) taxable as a corporation.
(g) The Trustee agrees to perform or cause to be performed the
obligations of the Trust, the Trustee and the Trustee on behalf of the Trust as
set forth in any Administration Agreement or other Trust Document to which the
Trust is a party, on the terms and subject to the conditions set forth therein.
Section 5.02. Duty of Care.
(a) Except during the continuance of an Event of Default, the Trustee
need perform only those duties specifically set forth in this Agreement and the
other Trust Documents. During the continuance of an Event of Default, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement and the other Trust Documents 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 prudent person's own affairs. No provision
of this Agreement shall be construed to relieve the Trustee from Liability for
its own negligent action, its own negligent failure to act, its own bad faith
or its own willful misconduct; provided, however, that the Trustee shall not be
personally liable:
(i) for any action taken, suffered or omitted by it or any error
of judgment, in each case made in good faith by any Responsible
Officer of the Trustee or the Trust Agent customarily performing
functions similar to those performed by such officers or to whom any
corporate trust matter is referred because of such individual's
knowledge of or familiarity with the particular subject, unless it
shall be proved that the Trustee or Trust Agent was negligent or acted
with bad faith or willful misconduct in performing its duties in
accordance with the terms of this Agreement; and
(ii) with respect to any action taken, suffered or omitted to be
taken in good faith in accordance with the express direction of (A) to
the extent relating to the UTI, a UTI Beneficiary or any Registered
Pledgee of a UTI Pledge or (B) to the extent relating to a SUBI, the
Holder or Registered Pledgee of a related SUBI Certificate, in each
case only to the extent such Registered Pledgee is authorized to give
such direction, in connection with a Securitized Financing relating to
the exercise of any power conferred upon the Trustee under this
Agreement.
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(b) Notwithstanding Section 5.02(a), the Trustee shall not be required
to expend or risk its own funds or otherwise incur Liability in the performance
of any of its duties under this Agreement or the other Trust Documents, or in
the exercise of any of its rights or powers, if there shall be reasonable
grounds for believing that the repayment of such funds or adequate indemnity
against such risk or Liability is not reasonably assured to it, and none of the
provisions contained herein or therein shall in any event require the Trustee
to perform, or be responsible for the manner of performance of, any of the
obligations of an Administrative Agent hereunder or under any Administration
Agreement except during such time, if any, as the Trustee shall be successor
to, and be vested with the rights, duties, powers and privileges of, the
Administrative Agent in accordance with this Agreement or any other Trust
Document.
(c) Except as otherwise authorized by the Trust Documents, the Trustee
shall take no action as to which it has been notified by a Beneficiary or a
Special Purpose Affiliate, or has actual knowledge, that such action would
impair the beneficial interests in the Trust, impair the value of any Trust
Asset or adversely affect the rating of any Rated Securities.
(d) All information obtained by the Trustee regarding the other
parties hereto or any of their respective Affiliates or the administration of
the Trust, the Lessees, the Vehicles or the Leases, whether upon the exercise
of its rights under this Agreement, any other Trust Document or otherwise,
shall be maintained by the Trustee in confidence and shall not be disclosed to
any Person other than to the Trust Agent, the Grantors, the Beneficiaries, the
Administrative Agent or any Special Purpose Affiliate, unless such disclosure
is required by any applicable law or regulation or pursuant to valid legal
process, or unless such information is already otherwise publicly available.
Section 5.03. Certain Matters Affecting the Trustee. Except as
otherwise provided in this Agreement:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document reasonably believed by it
to be genuine and to have been signed or presented by the proper party
or parties; provided, that it shall be obligated to examine any
certificates or opinions specifically required to be furnished to it
pursuant to the Trust Documents to determine whether they conform to
the requirements of this Agreement or the other Trust Documents, as
applicable. In particular, whenever any Trust Document provides that
the Trustee shall receive or may rely upon the instructions or
directions of a Beneficiary or a Holder, any written instruction or
direction purporting to bear the signature of any officer of such
Beneficiary or Holder reasonably believed by the Trustee to be genuine
may be deemed by the Trustee to have been signed or presented by the
proper party.
(b) The Trustee may consult with counsel, and any opinion of
counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in
good faith and in accordance with such opinion of counsel.
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(c) Subject to Section 5.02(a), the Trustee shall be under no
obligation to exercise any of the discretionary rights or powers
vested in it by this Agreement or by any other Trust Document, or to
institute, conduct or defend any litigation hereunder or in relation
hereto, at the request, order or direction of one or more
Beneficiaries or Holders pursuant to this Agreement or any other Trust
Document, unless such requesting Person shall have offered the Trustee
reasonable security or indemnity against any Liability, including
reasonable fees and expenses of counsel, that may be incurred therein
or thereby.
(d) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document, unless requested in writing
to do so by one or more Beneficiaries or Holders. Notwithstanding the
foregoing, if the payment within a reasonable time to the Trustee of
the Liability likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably
assured to it by the security afforded it by the terms of this
Agreement or any other Trust Document, the Trustee may require
reasonable indemnity against such Liability as a condition to so
proceeding. The reasonable Liability relating to each such examination
shall be paid by the Person requesting such examination or, if paid by
the Trustee, shall be reimbursed as a Trust Expense.
(e) The Trustee may execute any of the trusts or powers or
perform any duties under this Agreement or under the other Trust
Documents either directly or by or through agents, attorneys, Trust
Agents or custodians and shall not be liable for the negligence or
willful misconduct of such agents, attorneys, Trust Agents or
custodians appointed with due care.
(f) The Trustee shall make a copy of this Agreement available for
examination by the Holders and the Beneficiaries during normal
business hours at the address specified in Section 8.03(iv), or at
such other address as shall be designated by the Trustee in a written
notice in accordance with Section 8.03(xi).
Section 5.04. Trustee Not Liable for Certificates or Leases. The
Trustee shall not have any obligation to perform any of the duties of the
Grantors or the Administrative Agent unless explicitly set forth in this
Agreement or any other Trust Document to which the Trustee is a party. The
Trustee shall not at any time have any responsibility or Liability for or with
respect to: (i) the legality, validity and enforceability of any security
interest in any Trust Asset; (ii) the perfection or priority of such a security
interest or the maintenance of any such perfection and priority; (iii) the
efficacy of the Trust or its ability to generate the payments to be distributed
to the Holders under the Trust Documents, including the existence, condition,
location and ownership of any Trust Asset; (iv) the existence and
enforceability of any Insurance Policy; (v) the existence and contents of any
Lease or any computer or other record thereof; (vi) the validity of the
assignment of any Trust Asset to the Trust or the Trustee on behalf of the
Trust or of any intervening assignment; (vii) the completeness, performance or
enforcement of any Lease; (viii) the compliance by the Grantors or the
Administrative Agent with any covenant or the breach by a Grantor, any
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Beneficiary or the Administrative Agent of any warranty or representation in
any Trust Document and the accuracy of any such warranty or representation
prior to the Trustee's receipt of notice or other discovery of any
noncompliance therewith or any breach thereof; (ix) any investment of monies at
the direction of the Administrative Agent or any Loss resulting therefrom; (x)
the acts or omissions of any Person in connection with the origination of any
Lease; (xi) any action of the Administrative Agent taken in the name of the
Trustee; or (xii) any action by the Trustee taken at the instruction of the
Administrative Agent; provided, however, that the foregoing shall not relieve
the Trustee of its obligation to perform its duties under this Agreement or the
other Trust Documents to which the Trustee is a party. Except with respect to a
Claim based on the Trustee's willful misconduct, bad faith or negligence, (i)
no recourse shall be had against the institution serving as Trustee in its
individual capacity for any Claim based on any provision of this Agreement or
any such other Trust Document, a Certificate or any Trust Asset or assignment
thereof and (ii) the Trustee shall not have any personal obligation, Liability
or duty whatsoever to any Holder or any other Person with respect to any such
Claim, and any such Claim shall be asserted solely against the Trust Assets or
any indemnitor that shall furnish indemnity as provided for in this Agreement
or in the other Trust Documents. The Trustee shall not be accountable for the
use or application by a Holder or a Special Purpose Affiliate of any
Certificate or the proceeds thereof, or for the use or application of any funds
properly paid to the Administrative Agent pursuant to any Administration
Agreement.
Section 5.05. Indemnification of Trustee and Trust Agents. The Trustee
(and the Trust Agent, as applicable) shall be indemnified and held harmless out
of and to the extent of the Trust Assets with respect to any Loss incurred by
the Trustee arising out of or incurred in connection with (i) any Trust Assets
(including any Loss relating to Leases, Vehicles, misrepresentation or
deceptive and unfair trade practices, and including any other Loss relating to
personal injury or property damage Claims arising with respect to any Vehicle
or any Loss relating to any Tax arising with respect to any Trust Asset) or
(ii) acceptance or performance by the Trustee of the trusts and duties
contained in this Agreement or any other Trust Document, with any allocation of
such indemnification among the Trust Assets to be made as provided for in
Section 3.07 or in a Supplement; provided, however, that the Trustee shall not
be indemnified or held harmless out of the Trust Assets as to any such Loss (a)
for which the Administrative Agent shall be liable pursuant to Section 6.02 or
a corresponding section of any Supplement (unless (1) the Administrative Agent
would be entitled to reimbursement of such Loss from Trust Assets pursuant to a
related Administration Agreement or (2) the Administrative Agent shall not have
paid such Loss upon the final determination of its liability therefor), (b)
incurred by reason of the Trustee's willful misconduct, bad faith or negligence
or (c) incurred by reason of the Trustee's breach of Section 5.07(a)(i),
Section 5.12 or its representations and warranties pursuant to any
Administration Agreement.
Section 5.06. Trustee's Right Not to Act. Notwithstanding anything to
the contrary contained herein, the Trustee shall have the right to decline to
act in any particular manner otherwise provided for herein or in the other
Trust Documents if the Trustee, being advised in writing by counsel, determines
in good faith that such action may not lawfully be taken or would subject it to
personal Liability or be unduly prejudicial to the rights of any Holder; and
provided further, that nothing in this Agreement shall impair the right of the
Trustee to take any action deemed proper by it that is not inconsistent with
such otherwise required acts.
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Section 5.07. Qualification of Trustee.
(a) Except as otherwise provided in this Agreement, the Trustee shall
at all times be (i) a corporation organized under the laws of any State or the
United States (which corporation shall not be a Beneficiary or any Affiliate
thereof), (ii) qualified to do business in the States requested in writing by
the Administrative Agent and (iii) otherwise acceptable to each Rating Agency.
(b) In the event the Trustee complies with Section 5.07(a) but has its
principal place of business outside of the State of Delaware, then there shall
at all times be a co-trustee appointed to act as the Delaware Trustee pursuant
to Section 3807 of the Delaware Act. The Delaware Trustee shall serve as such
for the sole purpose of satisfying the requirement of Section 3807 of the
Delaware Act that the Trust have at least one trustee with a principal place of
business in Delaware. It is understood and agreed by the parties hereto and the
Holders that the Delaware Trustee shall have none of the duties or Liabilities
of the Trustee. The duties of the Delaware Trustee shall be limited to (i)
accepting legal process served on the Trust in the State of Delaware and (ii)
the execution of any certificates required to be filed with the Delaware
Secretary of State that the Delaware Trustee is required to execute under
Section 3811 of the Delaware Act. To the extent that, at law or in equity, the
Delaware Trustee has duties (including fiduciary duties) or Liabilities
relating thereto to the Trust or the Holders, it is hereby understood and
agreed by the parties hereto and the Holders that such duties and Liabilities
are replaced by the duties and Liabilities of the Delaware Trustee expressly
set forth in this Agreement.
Section 5.08. Resignation or Removal of Trustee.
(a) The Trustee may not at any time resign without the express written
consent of the UTI Beneficiaries, which consent shall not be unreasonably
withheld.
(b) The UTI Beneficiaries may remove the Trustee (i) if (A) at any
time the Trustee shall cease to be qualified in accordance with Section 5.07,
(B) any representation or warranty made by the Trustee pursuant to Section 5.12
shall prove to have been untrue in any material respect when made, but the
Trustee shall fail to resign after written request therefor by the UTI
Beneficiaries, (C) at any time the Trustee shall be legally unable to act, or
shall be adjudged bankrupt or insolvent, (D) a receiver of the Trustee or of
its property shall be appointed or (E) any public officer shall take charge or
control of the Trustee or its property or affairs for the purpose of
rehabilitation, conservation or liquidation or (ii) at their discretion,
subject to Section 5.14(b). Upon the removal of the Trustee, the UTI
Beneficiaries shall promptly appoint a successor Trustee by written instrument,
in duplicate, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor Trustee, together with payment of all
fees owed to the outgoing Trustee.
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(c) Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to this Article shall not become effective until
acceptance of appointment by the successor Trustee.
Section 5.09. Successor Trustee. Any successor Trustee appointed as
provided in Section 5.08 shall execute, acknowledge and deliver to the
Administrative Agent, the predecessor Trustee and each Beneficiary an
instrument accepting such appointment under this Agreement, and thereupon the
resignation or removal of such predecessor Trustee shall become effective and
such successor 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 and the other Trust Documents to which the
Trustee is a party, with like effect as if originally named as Trustee. The
predecessor Trustee shall deliver to the successor Trustee all documents held
by it under this Agreement and the other Trust Documents, and the predecessor
Trustee and the other parties to the Trust Documents 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 Trustee all such
rights, powers, duties and obligations. No successor Trustee shall accept
appointment as provided in this Section unless, at the time of such acceptance,
such successor Trustee shall be eligible under Section 5.07. Upon acceptance of
appointment by a successor Trustee as provided in this Section, the successor
Trustee shall mail notice of its appointment under this Agreement to each
Beneficiary at the address and in the manner provided for in Section 8.03, and
each Beneficiary shall mail notice of the successor of such Trustee under this
Agreement to each related Holder. If a Beneficiary fails to mail such notice
within ten days after acceptance of appointment by the successor Trustee, such
successor Trustee shall cause such notice to be mailed at the expense of such
Beneficiary.
Section 5.10. Merger or Consolidation of Trustee. The Trustee shall
not merge or consolidate with, or sell all or any substantial part of its
assets to, any other entity or Person without the express written consent of
the UTI Beneficiaries. Any corporation (i) into which the Trustee may be merged
or consolidated, (ii) that may result from any merger, conversion or
consolidation to which the Trustee shall be a party or (iii) that may succeed
to the corporate trust business of the Trustee, and in each case that executes
an agreement of assumption to perform every obligation of the Trustee under
this Agreement, shall be the successor of the Trustee hereunder, provided such
corporation shall be eligible pursuant to Section 5.07, without the execution
or filing of any instrument or any further act on the part of any of the
parties hereto other than the written consent of the UTI Beneficiaries. The
Trustee shall give notice to each Rating Agency prior to effecting any merger,
conversion, consolidation or other transaction described in this Section.
Section 5.11. Co-Trustees, Separate Trustees, Nominee and Trust
Agents.
(a) Notwithstanding any other provision of this Agreement, at any
time, for the purpose of meeting any legal requirements of any jurisdiction in
which any Trust Assets may at the time be located or within which such Trust
Assets are to be acquired, the UTI Beneficiaries and the Trustee, acting
jointly, shall have the power to execute and deliver all instruments to appoint
one or more Persons to act as co-trustee, jointly with the Trustee, or as a
separate trustee or nominee holder of legal title, of all or any part of such
Trust Assets, and to vest in such Person, in such capacity and for the benefit
of the Related Beneficiary, the Holders and their permitted assigns, such title
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to such Trust Assets, or any part thereof, and, subject to the other provisions
of this Section, such powers, duties, obligations, rights and trusts as the UTI
Beneficiaries and the Trustee may consider necessary or desirable. No such
co-trustee, separate trustee or nominee holder of legal title shall be required
to meet the terms of eligibility as a successor trustee pursuant to Section
5.09, except that no such co-trustee, separate trustee or nominee holder of
legal title under this Agreement may be a Beneficiary or any Affiliate thereof.
(b) Each co-trustee, separate trustee and nominee holder of legal
title shall, to the extent permitted by law, be appointed and act subject to
the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred upon and exercised or
performed by the Trustee and such co-trustee, separate trustee or
nominee holder of legal title jointly (it being understood that such
separate trustee or co-trustee is not authorized to act separately
without the Trustee joining in such act), except to the extent that
under any law of any jurisdiction in which any particular act or acts
are to be performed (whether as Trustee under this Agreement or as
successor to the Administrative Agent under this Agreement or any
Administration Agreement), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to the
Trust Assets or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such co-trustee, separate trustee or
nominee holder of legal title, but solely at the direction of the
Trustee;
(ii) no trustee or nominee holder of legal title hereunder shall
be personally liable by reason of any act or omission of any other
trustee or nominee holder of legal title hereunder; and
(iii) the UTI Beneficiaries and the Trustee, acting jointly, may
at any time accept the resignation of or remove any co-trustee,
separate trustee or nominee holder of legal title.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each co-trustee, separate trustee and nominee
holder of legal title, as effectively as if given to each of them. Every
instrument appointing any co-trustee, separate trustee or nominee holder of
legal title shall refer to this Agreement and the conditions of this Section.
Each co-trustee, separate trustee and nominee holder of legal title, upon its
acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision relating
to the conduct of, affecting the Liability of or affording protection to the
Trustee. Each such instrument shall be filed with the Trustee and a copy
thereof given to the Administrative Agent and each Related Beneficiary.
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Any co-trustee, separate trustee or nominee holder of legal title may
at any time and shall, at the request of the Trustee, appoint the Trustee or
the Trust Agent 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 co-trustee, separate
trustee or nominee holder of legal title shall die, become incapable of acting,
resign or be removed, then all of its estates, properties, rights, remedies and
trusts relating to this Agreement and the Trust Assets shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee. Notwithstanding anything to the
contrary in this Agreement, the appointment of any co-trustee, separate trustee
or nominee holder of legal title shall not relieve the Trustee of its
obligations and duties under this Agreement.
(d) The Trustee may enter from time to time into one or more Trust
Agency Agreements with a Trust Agent that is by experience and expertise
qualified to act in a trustee capacity and otherwise acceptable to the UTI
Beneficiaries. The Trustee shall provide prompt notice of the appointment of
each Trust Agent (other than the initial Trust Agent) to each Person and in the
manner specified in Section 8.03. Except as otherwise provided herein or in any
related Trust Agency Agreement, the Trust Agent shall be responsible for all
duties and obligations of the Trustee hereunder and under each other Trust
Document to which the Trustee is a party, and the Trustee hereby delegates to
the Trust Agent all power and authority delegable by the Trustee hereunder and
thereunder in order better to be able to carry out its duties as Trust Agent.
Each Trust Agency Agreement shall specify the duties, powers, Liabilities,
obligations and compensation of the Trust Agent to carry out on behalf of the
Trustee all of its obligations as Trustee arising under this Agreement or the
other Trust Documents to which the Trustee is a party, and shall contain a
non-petition covenant substantially identical to that set forth in Section
8.07; provided, however, that nothing contained in any Trust Agency Agreement
shall excuse, limit or otherwise affect any power, duty, obligation, Liability
or compensation otherwise applicable to the Trustee hereunder. Notwithstanding
the foregoing or the provisions of any Trust Agency Agreement, the Trustee
shall replace any Trust Agent if (i) in the judgment of the Related
Beneficiary, the compensation or level of service of such Trust Agent shall no
longer be reasonably competitive with those of any alternative agent reasonably
proposed by the Related Beneficiary, (ii) the Trust Agent has materially
breached its obligations under the related Trust Agency Agreement and the UTI
Beneficiaries or any Holder have given written notice to the Trustee and the
Trust Agent of such breach and the Trust Agent has not cured such breach in all
material respects within 30 Business Days thereafter or (iii) any Rating Agency
shall require the replacement of such Trust Agent. The Trustee hereby engages
U.S. Bank as the initial Trust Agent, and U.S. Bank hereby accepts such
engagement, with Section 8.07 and all provisions of this Section relating to
Trust Agents constituting a Trust Agency Agreement between it and the Trustee,
subject to any amendment or supplement thereto between such parties not
inconsistent herewith. So long as the Trustee is a Subsidiary of the Trust
Agent, the Trustee shall pay the Trust Agent reasonable compensation for its
services and shall provide such reimbursement of expenses as are separately
agreed to by the Trustee and the Trust Agent.
The Trust Agent shall be entitled to all of the benefits, protections,
indemnities and rights of reliance set forth in this Agreement with regard to
the Trustee. The Trust Agent may resign hereunder upon giving 30 days' prior
written notice to the Trustee, each related Holder and each Related
Beneficiary. Notwithstanding the foregoing, unless otherwise agreed to by the
Trustee and the UTI Beneficiaries, such resignation shall be effective only
upon the appointment of a successor Trust Agent in accordance with the terms
hereof.
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Section 5.12. Representations, Warranties and Covenants of Trustee.
The Trustee hereby makes the following representations, warranties and
covenants on which the other parties hereto, their respective permitted
assignees and pledgees, each Holder (and beneficial owner of any portion of the
related Certificate in connection with a Securitized Financing) and each
Beneficiary may rely:
(a) The Trustee is a corporation, duly organized, validly
existing and in good standing under the laws of the State of Delaware
and is qualified to do business as a foreign corporation and is in
good standing in each State identified in an Officer's Certificate of
the Administrative Agent delivered on the Effective Date. The Trustee
shall promptly take or cause to be taken all such actions and execute
and file or cause to be executed and filed all such instruments and
documents, the cost of which shall be a Trust Expense, as may
reasonably be required in order for the Trustee to qualify to do
business and be in good standing in each other State identified in
writing from time to time by a Beneficiary or the Administrative
Agent.
(b) The Trustee has full power, authority and right to execute,
deliver and, assuming that the filings set forth on an Officer's
Certificate of the Administrative Agent delivered on the Effective
Date are sufficient to allow the Trustee to act as a trustee with
respect to the Trust Assets, perform this Agreement in all material
respects, and has taken all necessary action to authorize the
execution, delivery and performance by it of this Agreement.
(c) This Agreement has been duly executed and delivered by the
Trustee, and is a legal, valid and binding instrument enforceable
against the Trustee in accordance with its terms.
(d) Neither the execution and delivery of this Agreement or the
other Trust Documents to which the Trustee is a party, the
consummation of the transactions herein or therein contemplated nor
compliance with the provisions hereof or thereof, will conflict with
or result in a breach of or constitute a default (with notice or
passage of time or both) under any provision of any judgment, decree
or order binding upon the Trustee or the certificate of incorporation
or bylaws of the Trustee or any provision of any mortgage, indenture,
contract, agreement or other instrument to which the Trustee is a
party or by which it is bound.
(e) The Trustee has not engaged, is not currently engaged and
will not engage during the term of this Agreement, in any activity
other than serving as Trustee and such ancillary activities as are
necessary and proper in order to act as Trustee pursuant to this
Agreement and the other Trust Documents.
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Section 5.13. Trustee's Fees and Expenses. Except as otherwise
provided in the other Trust Documents, the Administrative Agent shall, subject
to reimbursement to the extent provided in a related Administration Agreement,
(i) pay the Trustee and the Delaware Trustee reasonable compensation as shall
be agreed upon from time to time by the Trust or the Delaware Trustee, as the
case may be, and the Administrative Agent (and which shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust) for all services rendered by the Trustee or the Delaware Trustee, as the
case may be, in the execution of the Trust and in the exercise and performance
of any of the powers and duties under this Agreement and the other Trust
Documents to which it is a party and (ii) reimburse the Trustee and the
Delaware Trustee for all reasonable expenses (including reasonable attorneys'
fees) for the Trustee's or the Delaware Trustee's costs of qualification,
periodic maintenance of corporate franchises and qualifications (excluding
Taxes payable in respect of income earned by the Trustee or the Delaware
Trustee), annual board of directors' meetings and all necessary corporate
filings.
Section 5.14. Trustee Stock. U.S. Bank hereby makes the following
representations, warranties and covenants on which the other parties hereto,
their respective permitted pledgees and assigns and each Holder (and beneficial
owner of any portion of the related Certificate in connection with a
Securitized Financing) and Beneficiary may rely:
(a) All of the Trustee Stock is owned by U.S. Bank free and clear
of any Lien or other restriction, agreement or commitment of any kind
(other than as provided for in this Agreement) that would in any way
restrict its ability freely to transfer, convey and assign the Trustee
Stock. All such Trustee Stock currently outstanding is (and any
Trustee Stock that may be issued in the future will be) validly
issued, fully paid and nonassessable and has not been (and will not
be) issued in violation of any preemptive, first refusal or other
subscription rights of any Person. There are no outstanding options,
warrants, conversion rights, subscription rights, preemptive rights,
exchange rights or other rights, agreements or commitments of any kind
obligating U.S. Bank to sell any Trustee Stock or to issue any
additional Trustee Stock to any Person. No additional Trustee Stock
may be issued without the express written consent of the UTI
Beneficiaries.
(b) For so long as U.S. Bank is acting as a Trust Agent pursuant
to this Agreement or any Trust Agency Agreement, but subject to any
applicable legal or regulatory requirements, it shall retain ownership
of all of the Trustee Stock. If at any time (and for any reason,
including U.S. Bank's resignation or termination as Trust Agent or the
dissolution of the Trust) U.S. Bank either is no longer acting as a
Trust Agent, is no longer able, due to legal or regulatory changes, to
own the Trustee Stock, or the Trustee would have to be removed
pursuant to Section 5.08(b) as a result of its being owned by U.S.
Bank, U.S. Bank shall (i) notify the UTI Beneficiaries of such event
and (ii) sell to the designee of the UTI Beneficiaries (which shall
not be a Beneficiary or an Affiliate thereof), at the option of such
UTI Beneficiaries, without recourse except with respect to the
representations, warranties and covenants contained herein, all of the
Trustee Stock for the sum of $10 plus all Liquid Trustee Assets. Such
designee shall have 120 days from the date of receipt of such notice
in which to exercise such option and to consummate such acquisition,
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during which time U.S. Bank shall not sell or offer for sale any
Trustee Stock to any other Person. If such designee does not
consummate such acquisition within such period, U.S. Bank may sell or
offer for sale to any Person any or all of the Trustee Stock or may
dissolve the Trustee; provided, however, that if, upon or in
connection with U.S. Bank no longer being a Trust Agent, a successor
Trust Agent shall be appointed by the Trustee, U.S. Bank shall next
grant to such successor Trust Agent an option for it or its designee
to buy the Trustee Stock without recourse except with respect to the
representations, warranties and covenants contained herein, for the
sum specified above. Such successor Trust Agent or its designee shall
have 120 days from the date of receipt of such offer in which to
exercise such option and consummate such acquisition, during which
time no Trustee Stock may be offered for sale or sold to any Person
other than such successor Trust Agent or its designee. Upon any timely
exercise of the foregoing option to acquire the Trustee Stock, U.S.
Bank shall promptly tender all such Trustee Stock to such buyer at a
time and place determined by the buyer, duly endorsed in blank or with
duly endorsed stock powers attached, against payment of the purchase
price. U.S. Bank shall pay any transfer or similar taxes arising from
a transfer of the Trustee Stock as contemplated herein; provided, that
the UTI Beneficiaries shall pay such amounts if the Trustee is removed
pursuant to Section 5.08(b)(ii).
Section 5.15. Limitation of Liability of Trustee.
(a) Notwithstanding anything contained herein to the contrary, in no
event shall RTRT, Inc., in its individual capacity, or any Trust Agent
appointed hereunder have any Liability for the representations, warranties,
covenants, agreements or other obligations of the Trust hereunder (other than
any certificate of authentication), as to all of which recourse shall be had
solely to the Trust Assets.
(b) For all purposes of this Agreement, in the performance of any
duties or obligations of the Trust hereunder, the Trustee and the Trust Agent
shall be subject to, and entitled to the benefits of, the terms and provisions
of Article Five.
(c) Except as otherwise indicated by context, any reference herein to
actions taken or amounts received in trust by the Trustee shall be deemed to
mean the Trustee acting on behalf of the Trust and all Beneficiaries.
(d) The Trustee hereby acknowledges and agrees that Ryder owns all
rights to the name RTRT, Inc.
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ARTICLE SIX
THE ADMINISTRATIVE AGENT
Section 6.01. Duties of the Administrative Agent. The Administrative
Agent is hereby appointed and authorized to act as attorney-in-fact for the
Trust, and in such capacity shall manage, service, administer, dispose of and
make collections on the Trust Assets with reasonable care, using that degree of
skill and attention that it exercises with respect to comparable assets that it
services for itself or others. The Trustee shall enter into any agreement as a
Beneficiary may, with the consent of the Administrative Agent, direct in order
to add, delete or amend any or all of the obligations of the Administrative
Agent hereunder in respect of all or any portion of the Related Trust Assets.
The Administrative Agent shall follow its customary standards, policies and
procedures, as the same may change from time to time, and, unless otherwise
indicated herein or in any Administration Agreement, shall have full power and
authority, acting alone, to take any action in connection with such managing,
servicing, administering, disposing of and collecting that it may deem
necessary or desirable in the interest of the Trust. Without limiting the
generality of the foregoing, the Administrative Agent is hereby authorized and
empowered by the Beneficiaries and the Trust to execute and deliver, on behalf
of the Trust, any instrument, certificate or other document necessary or
advisable to record and maintain title to the Vehicles in the name of the Trust
or the Trustee on behalf of the Trust and to release interests of the Trust,
the Trustee and the Beneficiaries in any Vehicle in connection with the sale or
other disposition of such Vehicle as contemplated by this Agreement and the
other Trust Documents. The Administrative Agent also shall be responsible for
creating, maintaining and amending the Schedule of Vehicles. The Administrative
Agent shall deliver to the Trustee (i) with respect to the UTI, upon request,
and (ii) with respect to any SUBI, as specified in the related Supplement, a
revised Schedule of Vehicles. The Administrative Agent is hereby authorized, in
its own name, in the name of the Trust or in the name of the Trustee on behalf
of the Trust, to commence, defend against or otherwise participate in a
Proceeding relating to or involving the protection or enforcement of the
interest of the Trust, the Trustee on behalf of the Trust, a Beneficiary or a
Holder in any Lease, Vehicle or other Trust Asset. If the Administrative Agent
shall commence, defend against or otherwise participate in a Proceeding in its
own name, then the Trust, the Trustee on behalf of the Trust, such Holder or
such Beneficiary shall thereupon be deemed to have automatically assigned its
interest in (including legal title to) each related Lease, Vehicle or other
Trust Asset to the Administrative Agent to the extent necessary for purposes of
such Proceeding. The Administrative Agent is authorized and empowered by the
Trust to execute and deliver in the Administrative Agent's name any notices,
demands, claims, complaints, responses, affidavits or other documents or
instruments in connection with any such Proceeding. The Trustee shall furnish
the Administrative Agent with any powers of attorney and other documents and
take any other steps the Administrative Agent may deem necessary or appropriate
to enable it to carry out its duties under this Agreement and the other Trust
Documents. If in any Proceeding it shall be held that the Administrative Agent
may not enforce the rights of the Trust, the Trustee on behalf of the Trust, a
Holder or a Beneficiary in any Lease, Vehicle or other Trust Asset on the
grounds that it is not the real party in interest or a holder entitled to
enforce such Lease or other relevant document or instrument, then the Trustee,
on behalf of the Trust, shall, at the direction of the Administrative Agent,
take steps to enforce the interest of the Trust, the Trustee on behalf of the
Trust, a Holder or a Beneficiary in such Lease, Vehicle or other Trust Asset,
including bringing suit in its own name or in the name of the Related
Beneficiary or related Holder. The Administrative Agent shall advance the costs
or expenses of any such action to the Trustee, subject to reimbursement to the
extent provided in any related Administration Agreement.
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Section 6.02. Liability of Administrative Agent; Indemnities.
(a) The Administrative Agent shall be liable in accordance with this
Agreement and the other Trust Documents only to the extent of the obligations
specifically undertaken by the Administrative Agent and shall have no other
obligations or Liabilities hereunder or thereunder. Such obligations shall
include, with respect to this Agreement, the obligation to indemnify, defend
and hold harmless the following parties; provided, that the Trustee and the
Trust Agent shall not receive payments hereunder to the extent they have been
otherwise reimbursed for such amounts:
(i) the Trust, the Trustee and the Trust Agent, from and against
(A) any Loss arising out of or resulting from the use or operation of
any Vehicle by the Administrative Agent or any Affiliate thereof and
(B) any Taxes that may at any time be asserted against the Trust, the
Trustee or the Trust Agent with respect to the transactions
contemplated by this Agreement (other than Taxes based on income
payable to such Persons hereunder), including any sales, gross
receipts, general corporation, tangible personal property, privilege
or license Taxes and costs and expenses in defending against the same;
(ii) the Trust, the Trustee, the Trust Agent, the Beneficiaries
and the Holders, from and against any Loss to the extent such Loss
arose out of or was imposed upon such Persons by reason of (A) the
performance by the Administrative Agent of its duties or (B) the
disregard by the Administrative Agent of its obligations and duties,
in each case hereunder or under any Administration Agreement; and
(iii) the Trustee and the Trust Agent, from and against any Loss
arising out of or incurred in connection with their acceptance or
performance of the trusts and duties contained in this Agreement or
any other Trust Document, except to the extent any such Loss (A) is
due to the willful misfeasance, bad faith or negligence (except for
good faith errors in judgment) of the Trustee or the Trust Agent, (B)
arises from the material breach by the Trustee or the Trust Agent of
any of its obligations, representations or warranties set forth in
this Agreement or in any Trust Agency Agreement or (C) arises out of
or is incurred in connection with the performance by the Trustee of
the duties of successor Administrative Agent hereunder or under any
Administration Agreement.
(b) If the Administrative Agent has made any indemnity payments
pursuant to this Section and the recipient thereafter collects any such amounts
from others, the recipient shall promptly repay such amounts collected to the
Administrative Agent, without interest. Indemnification under this Section
shall survive (i) any transaction described in Section 6.03 with respect to any
Trust Assets as of the date of such transaction and any act, occurrence or
transaction related thereto, whether arising before or after the date of such
transaction and (ii) the termination of this Agreement and the other Trust
Documents.
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Section 6.03. Merger of Administrative Agent; Appointment of Nominee.
Any corporation (i) into which the Administrative Agent may be merged or
consolidated, (ii) resulting from any merger, conversion or consolidation to
which the Administrative Agent may be a party, (iii) succeeding to the business
of the Administrative Agent or (iv) more than 50% of the voting stock of which
is owned directly or indirectly by Ryder and that is otherwise servicing
vehicle leases, which corporation in any of the foregoing cases executes an
agreement of assumption to perform every obligation of the Administrative
Agent, shall be the successor to the Administrative Agent without the execution
or filing of any paper or any further act on the part of any of the parties to
this Agreement.
Section 6.04. Limitation on Liability of Administrative Agent and
Others.
(a) Except as otherwise provided in this Agreement and the other Trust
Documents, neither the Administrative Agent nor any of its directors, officers,
employees or agents shall have any Liability to the Trust, the Trustee, the
Trust Agent, any Beneficiary, any Holder, any Registered Pledgee or any Special
Purpose Affiliate for any action taken or for refraining from the taking of any
action pursuant hereto or thereto, or for any error in judgment.
Notwithstanding the foregoing, this provision shall not protect the
Administrative Agent or any such Person against any Liability that would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
(except errors in judgment) in the performance of duties or by reason of
reckless disregard of obligations and duties hereunder or thereunder. The
Administrative Agent and its directors, officers, employees and agents 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 or thereunder, and in so doing, shall not be acting in bad
faith or with negligence, willful misfeasance or reckless disregard.
(b) Except as otherwise provided in this Agreement and the other Trust
Documents, the Administrative Agent shall be under no obligation to appear in,
prosecute or defend any Proceeding that is not incidental to its duties to
service the Trust Assets in accordance herewith or therewith and that in its
opinion may involve it in any Liability. Notwithstanding the foregoing, the
Administrative Agent may undertake any reasonable action that it may deem
necessary or desirable in respect of this Agreement and the other Trust
Documents and the rights and duties of the parties hereto or thereto and the
interests of any Beneficiary hereunder or thereunder. In such event, any Loss
resulting from such action shall be (i) a Trust Expense of the related
Sub-Trust and (ii) a Reimbursable Expense to the extent paid by the
Administrative Agent, and in each case shall be allocated to the Related Trust
Assets.
Section 6.05. Administrative Agent Not to Resign; Delegation of
Duties.
(a) Subject to Section 6.03, the Administrative Agent shall not resign
from the obligations and duties imposed on it by this Agreement as
Administrative Agent except upon a determination that the performance of its
duties under this Agreement is no longer permissible under applicable law. Any
such determination permitting the resignation of the Administrative Agent shall
be evidenced by an Opinion of Counsel to such effect delivered to the Trustee.
No such resignation shall become effective until a successor administrative
agent shall have assumed the responsibilities and obligations of the
Administrative Agent. Neither the Trustee nor the Trust Agent shall be
obligated to serve as successor administrative agent under this Agreement
except upon its prior written consent.
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<PAGE> 44
(b) Except as otherwise provided in this Agreement and the other Trust
Documents, the Administrative Agent may not assign any of its rights, powers,
duties or obligations under this Agreement. Notwithstanding the foregoing, the
Administrative Agent may make such an assignment in connection with a
consolidation, merger, conversion or other event made in compliance with
Section 6.03.
(c) Except as otherwise provided in this Agreement and the other Trust
Documents, the duties and obligations of the Administrative Agent under this
Agreement shall continue until this Agreement has been terminated as provided
in Section 7.01, and shall survive the exercise by the Trustee of any right or
remedy under, or the enforcement by the Trustee of any provision of, this
Agreement or any other Trust Document.
Section 6.06. Servicing Compensation. The Administrative Agent shall
receive such fees and reimbursement for expenses with respect to the Trust
Assets relating to the UTI or a SUBI, as applicable, as may be agreed to from
time to time between the Administrative Agent and the Related Beneficiary.
Section 6.07. Powers of Attorney. The Administrative Agent is hereby
designated by each of the Trust and the Trustee as its true and lawful
attorney-in-fact, with full power and authority to perform any act relating to
managing, servicing, administering, disposing of and collecting all or any part
of the Trust Assets and any act otherwise required or permitted to be performed
by the Administrative Agent under this Agreement and the other Trust Documents.
The Administrative Agent is hereby authorized and empowered to execute and
deliver, on behalf and in the name of the Trustee or the Trust, any instrument,
certificate or other document relating thereto. The Administrative Agent shall
also have the right, power and authority to designate in writing other Persons
as true and lawful attorneys-in-fact for and on behalf of the Trustee and the
Trust to do anything that the Administrative Agent has the power to do under
this Agreement and the other Trust Documents. Without limiting the generality
of the foregoing, the Administrative Agent or any such Person designated by the
Administrative Agent is hereby authorized and empowered by the Trustee and the
Trust to (i) apply for and maintain the licenses, permits and authorizations
and make the filings described in Section 5.01(c) and (ii) execute and deliver,
on behalf of the Trustee and the Trust, any applications for or duplicates of
Certificates of Title in the name of the Trust or the Trustee on behalf of the
Trust, any applications for registration of Vehicles or license plates, any
applications for transfers of Certificates of Title or transfers of
registration for Vehicles or license plates, and any other instruments,
certificates or other documents that the Administrative Agent may deem
necessary or advisable to record, hold or release title to or registration of
Vehicles in the manner provided for herein.
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Section 6.08. Protection of Title to Trust.
(a) The Administrative Agent shall maintain accounts and records as to
legal title to the Trust Assets (including records identifying the Sub-Trust to
which each Trust Asset is allocated) and any other assets held by the Trust
accurately and in sufficient detail as to permit the reader thereof to know at
any time the status of such legal title.
(b) The Administrative Agent shall maintain its computer systems such
that its master computer records (including any back-up archives) that refer to
any Vehicle indicate clearly that legal title to such Vehicle is held by the
Trust or the Trustee on behalf of the Trust as nominee holder of legal title
for the Related Beneficiary or the related Holders. Any reference to such legal
title shall be deleted from or modified on such computer systems when, and only
when, such legal title is no longer so held.
(c) If at any time the Administrative Agent or a Related Beneficiary
proposes to sell, grant a security interest in or otherwise transfer any
interest in any Vehicle to any prospective purchaser, lender or other
transferee, all computer tapes, records or print-outs (including any restored
from back-up archives) delivered by the Trustee to such prospective purchaser,
lender or other transferee that refer in any manner whatsoever to such Vehicle
shall indicate clearly that legal title to such Vehicle is held in the name of
the Trust or the Trustee on behalf of the Trust for the benefit of the Related
Beneficiary or the related Holder.
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<PAGE> 46
ARTICLE SEVEN
TERMINATION AND DISSOLUTION
Section 7.01. Dissolution of the Trust.
(a) Subject to Section 7.03(b), the Trust shall continue in full force
and effect until the payment to each Holder or its designee of all amounts
required to be paid to it pursuant to this Agreement and the related
Certificates and the expiration or termination of all Securitized Financings by
their respective terms.
(b) Upon the occurrence of the events described in Section 7.01(a),
after satisfaction of all obligations to creditors, if any, of the Trust, the
Trustee shall (i) distribute the Trust Assets to the Related Beneficiary or its
designee in accordance with this Agreement and the Supplements, (ii) together
with the Related Beneficiary, cause the Certificates of Title to any Vehicles
so distributed to such Related Beneficiary to be issued in the name of, or at
the direction of, such Related Beneficiary, and such Related Beneficiary shall
pay or cause to be paid all applicable titling and registration fees and taxes,
(iii) take such action as may be requested by a Related Beneficiary in
connection with the transfer of Related Trust Assets to such Related
Beneficiary or its designee, including the execution and delivery of assignment
forms appearing on the Certificates of Title or any other instruments of
transfer or assignment with respect to the related Vehicles and (iv) file or
cause to be filed a certificate of cancellation with the Delaware Secretary of
State pursuant to Section 3810(d) of the Delaware Act. Upon the filing
described in clause (iv), this Agreement shall terminate and the Trustee shall
be discharged from all duties and obligations hereunder.
(c) Notwithstanding any other provision of this Agreement, in no event
shall the Trust continue beyond the expiration of 21 years from the death of
the last survivor of the descendants of Joseph P. Kennedy, the late Ambassador
of the United States to the Court of St. James's, living on the date hereof.
Section 7.02. Termination of Sub-Trusts.
(a) Subject to Section 7.03, this Agreement shall terminate with
respect to the Trust Assets allocated to a Sub-Trust, and not, except as
otherwise provided in a Supplement, as to any Trust Assets allocated to any
other Sub-Trust, upon the written direction to the Trustee by the Related
Beneficiary to revoke and terminate such Sub-Trust, following the satisfaction
of all obligations to creditors, if any, of such Sub-Trust, the payment to each
related Holder or its designee of all amounts required to be paid to it
pursuant to this Agreement and such Holder's Certificate, and the expiration or
termination of all related Securitized Financings by their respective terms.
Following such direction with respect to a Sub-Trust and the delivery of the
related Certificates to the Trustee for cancellation, the Trustee shall
distribute to the Related Beneficiary or its designee all Related Trust Assets
and shall cause the Certificates of Title to the related Vehicles to be issued
in the name of, or at the direction of, such Related Beneficiary (which, in the
case of a SUBI, may include reallocation of the related SUBI Assets to the
UTI). The Related Beneficiary to which such Trust Assets are distributed shall
pay or cause to be paid all applicable titling and registration fees and taxes.
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<PAGE> 47
(b) Upon the revocation and termination of a Sub-Trust, the related
Certificates shall be returned to the Trustee for cancellation. Such revocation
and termination shall not effect a revocation or termination of any other
Sub-Trust in existence at the time of such revocation and termination.
Section 7.03. Beneficiary or Special Purpose Affiliate Bankruptcy.
(a) The bankruptcy, insolvency, dissolution or similar occurrence of a
Beneficiary or a Special Purpose Affiliate shall not, except as otherwise
provided in Section 7.03(b) or a related Supplement, (i) cause the dissolution
of the Trust or the termination of this Agreement with respect to the Trust or
any Sub-Trust, (ii) entitle the legal representatives of such Beneficiary or
Special Purpose Affiliate to claim an accounting or to take any action in any
court for a partition or winding up of the Trust or any Trust Assets other than
the Related Trust Assets or (iii) otherwise affect the rights, obligations or
Liabilities of the parties hereto.
(b) Upon the bankruptcy, insolvency, dissolution or similar occurrence
of the 1% UTI Beneficiary, the UTI shall terminate unless, within 90 days of
such bankruptcy, insolvency, dissolution or similar occurrence, (i) the 99% UTI
Beneficiary (A) agrees in writing that the UTI shall not be terminated and (B)
designates an additional UTI Beneficiary to serve as the 1% UTI Beneficiary,
transfers to such additional UTI Beneficiary a 1% ownership interest in the UTI
and presents the UTI Certificate originally evidencing the 99% ownership
interest in the UTI to the Trustee for registration of transfer to such
additional UTI Beneficiary of a 1% ownership interest in the UTI, (ii) the
Trustee registers such transfer and issues new UTI Certificates to such UTI
Beneficiaries evidencing their respective ownership interests in the UTI and
(iii) such additional UTI Beneficiary delivers to the Administrative Agent, the
Trustee and the 99% UTI Beneficiary an agreement in form and substance
satisfactory to the Administrative Agent, the Trustee and the 99% UTI
Beneficiary.
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<PAGE> 48
ARTICLE EIGHT
MISCELLANEOUS
Section 8.01. Amendment. This Agreement, including the terms of the
UTI Certificates, may be amended or supplemented by written agreement among the
UTI Beneficiaries, the Administrative Agent and the Trustee (and the Trust
Agent, if such amendment affects its rights or obligations hereunder as Trust
Agent), with the consent of each Beneficiary and Holder affected thereby;
provided, however, that the consent of a Holder shall not be required if (i)
(A) the purpose of such amendment or supplement is to cure any ambiguity, to
correct or supplement any provision of this Agreement that may be inconsistent
with any other provision of this Agreement, to add any provision that provides
additional rights to Holders or to ensure that none of the Trust or one or more
Beneficiaries is classified as an association (or a publicly traded
partnership) taxable as a corporation for federal income tax purposes and (B)
such amendment or supplement will not, in the good faith judgment of the UTI
Beneficiaries and the Administrative Agent, materially and adversely affect the
interest of any Holder or (ii) an Opinion of Counsel is delivered to the
Trustee to the effect that such amendment or supplement will not materially and
adversely affect the interest of any Holder. After the first Securitized
Financing, any such amendment shall require such additional approvals, if any,
as may be required under each related Securitized Financing.
Section 8.02. Governing Law. This Agreement shall be created under and
governed by and construed under the internal laws of the State of Delaware,
without regard to any otherwise applicable principles of conflicts of laws.
Section 8.03. Notices. All demands, notices and communications under
this Agreement or any Supplement shall be in writing and shall be delivered or
mailed by registered or certified first class United States mail (postage
prepaid, return receipt requested), hand delivery, prepaid courier service or
telecopier, and addressed in each case as follows: (i) if to Ryder Truck Rental
I LP, at 3600 N.W. 82nd Avenue, Miami, Florida 33166 (telecopier no. (305)
500-3641), Attention: Treasurer 2C, with a copy to Serge G. Martin, Esq., Law
5C, at the same street address (telecopier no. (305) 500-3198); (ii) if to
Ryder Truck Rental II LP, at 3600 N.W. 82nd Avenue, Miami, Florida 33166
(telecopier no. (305) 500-3641), Attention: Treasurer 2C, with a copy to Serge
G. Martin, Esq., Law 5C, at the same street address (telecopier no. (305)
500-3198); (iii) if to the Administrative Agent, at 3600 N.W. 82nd Avenue,
Miami, Florida 33166 (telecopier no. (305) 500-3641), Attention: Treasurer 2C,
with a copy to Serge G. Martin, Esq., Law 5C, at the same street address
(telecopier no. (305) 500-3198); (iv) if to the Trustee, in care of the Trust
Agent at One Illinois Center, 111 East Wacker Drive, Suite 3000, Chicago,
Illinois 60601 (telecopier no. (312) 228-9401), Attention: Ryder Truck Leasing,
with a copy (which shall not constitute notice) to each Beneficiary; (v) if to
the Trust Agent, at One Illinois Center, 111 East Wacker Drive, Suite 3000,
Chicago, Illinois 60601 (telecopier no. (312) 228-9401), Attention: Ryder Truck
Leasing; (vi) if to the Delaware Trustee, at Three Beaver Valley Road, 4th
Floor, Wilmington, Delaware 19803 (telecopier no. (302) 421-7387), Attention:
Richard N. Smith; (vii) if Standard & Poor's is a Rating Agency, to 26
Broadway, 15th Floor, New York, New York 10004, Attention: Asset Backed
Surveillance Department; (viii) if Moody's is a Rating Agency, to 99 Church
Street, New York, New York 10007, Attention: ABS Monitoring Department; (ix) if
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<PAGE> 49
Duff & Phelps is a Rating Agency, to 55 East Monroe Street, Chicago, Illinois
60603; (x) if Fitch is a Rating Agency, to One State Street Plaza, New York,
New York 10004; or (xi) with respect to any of the foregoing Persons, at such
other address as shall be designated by such Person in a written notice to the
other foregoing Persons. Delivery shall occur only upon actual receipt or
rejected tender of such communication by an officer of the recipient entitled
to receive such notices located at the address of such recipient for notices
hereunder. A copy of all notices to the Trustee shall also be delivered to the
Trust Agent.
Section 8.04. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement (including any
amendment or Supplement hereto) shall be for any reason whatsoever held invalid
or unenforceable, then such covenants, agreements, provisions or terms shall be
deemed severable from the remaining covenants, agreements, provisions and terms
of this Agreement, as the same may be amended or supplemented, and shall in no
way affect the validity or enforceability of the other covenants, agreements,
provisions or terms of this Agreement or any amendment or Supplement hereto or
of any Certificate or the rights of any Holder.
Section 8.05. Counterparts. This Agreement may be executed in any
number of counterparts, each of which so executed and delivered shall be deemed
to be an original, but all of which counterparts shall together constitute but
one and the same instrument.
Section 8.06. Successors and Assigns. All covenants and agreements
contained in this Agreement shall be binding upon, and inure to the benefit of,
the parties hereto, the Holders and their respective permitted successors and
assigns. Any request, notice, direction, consent, waiver or other instrument or
action by a Holder shall bind the successors and assigns of such Holder.
Notwithstanding the foregoing, the Trustee may not assign or delegate any of
its rights or obligations under this Agreement, except as provided herein,
without the prior written consent of the UTI Beneficiaries.
Section 8.07. No Petition. Each of the parties hereto covenants and
agrees that prior to the date that is one year and one day after the date upon
which all obligations under each Securitized Financing have been paid in full,
it will not (and, to the fullest extent permitted by applicable law, the
Trustee shall not have the power to) institute against, or join any other
Person in instituting against, the Grantors, the Trustee, the Trust, any
Special Purpose Affiliate, any Beneficiary, any general partner of a
Beneficiary or of a Special Purpose Affiliate that is a partnership or any
member of a Beneficiary or Special Purpose Affiliate (or any of their
respective general partners) that is a limited liability company, any
bankruptcy, reorganization, arrangement, insolvency or liquidation Proceeding
or other Proceeding under any federal or state bankruptcy or similar law. This
Section shall survive the complete or partial termination of this Agreement,
the resignation or removal of the Trustee and the complete or partial
resignation or removal of the Administrative Agent.
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Section 8.08. Table of Contents and Headings. The Table of Contents
and Article and Section headings herein are for convenience of reference only
and shall not define or limit any of the terms or provisions hereof.
Section 8.09. Tax Reporting and Characterization.
(a) Consistent with the treatment of the Trust and each Sub-Trust for
tax purposes as a mere nominee holder of legal title, unless otherwise required
by appropriate taxing authorities, neither the Trust nor any Sub-Trust shall
file or cause to be filed any annual or other tax returns. In the event the
Trust, any Sub-Trust or the Trustee on behalf of the Trust is required to file
any tax returns, the Administrative Agent shall prepare or cause to be prepared
such returns and shall deliver such returns to the Trustee for signature,
unless applicable law requires one or more Beneficiaries to sign such returns,
in which case the Administrative Agent shall deliver such returns to such
Beneficiaries for signature.
(b) The parties hereto (i) intend that neither the Trust nor any
Sub-Trust shall constitute a separate entity for federal income or state income
or franchise tax purposes and that each Beneficiary shall be treated for such
tax purposes as if it owned the Related Trust Assets directly, rather than
through the Trust, and (ii) agree to treat the Trust, each Sub-Trust and the
Related Trust Assets accordingly for federal income and state income and
franchise tax purposes. However, in the event the Trust or any Sub-Trust is
characterized as a separate entity for federal income or state income or
franchise tax purposes, the parties hereto intend that the Trust or such
Sub-Trust, as the case may be, shall qualify for such tax purposes as a
partnership that has elected out of partnership status under Section 761 of the
Code (and analogous state law tax provisions).
Section 8.10. Certificates Nonassessable and Fully Paid. Except as
otherwise provided in a Supplement, the interests represented by the
Certificates shall be nonassessable for any Loss of the Trust or for any reason
whatsoever and, upon authentication thereof by the Trustee, each Certificate
shall be deemed fully paid.
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<PAGE> 51
ARTICLES NINE AND TEN
[Reserved]
47
<PAGE> 52
IN WITNESS WHEREOF, the Grantors and UTI Beneficiaries, the
Administrative Agent, the Trustee, the Delaware Trustee and, solely for the
limited purposes set forth in Sections 5.03(e), 5.11(d), 5.14, 5.15, 8.01, 8.03
and 8.07, the Trust Agent, have caused this Agreement to be duly executed by
their respective officers as of the day and year first above written.
RYDER TRUCK RENTAL I LP,
as Grantor and UTI Beneficiary
By: RYDER TRUCK RENTAL I LLC,
as General Partner
By:
------------------------------------
Name:
Title:
RYDER TRUCK RENTAL II LP,
as Grantor and UTI Beneficiary
By: RYDER TRUCK RENTAL II LLC,
as General Partner
By:
------------------------------------
Name:
Title:
RYDER TRUCK RENTAL, INC.,
as Administrative Agent
By:
------------------------------------
Name:
Title:
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<PAGE> 53
RTRT, INC.,
as Trustee
By:
------------------------------------
Name:
Title:
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
as Delaware Trustee
By:
------------------------------------
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as Trust Agent
By:
------------------------------------
Name:
Title:
49
<PAGE> 54
EXHIBIT A
CERTIFICATE OF TRUST OF RYDER TRUCK RENTAL LT
This Certificate of Trust of Ryder Truck Rental LT (the "Trust"),
dated as of June 1, 1997, is being duly executed and filed by Delaware Trust
Capital Management, Inc., a Delaware banking corporation, as Delaware trustee
(the "Delaware Trustee"), and RTRT, Inc., a Delaware corporation, as trustee,
to form a business trust under the Delaware Business Trust Act (12 Del. C.
ss.3801 et seq.).
(a) Name. The name of the business trust formed hereby is Ryder
Truck Rental LT.
(b) Delaware Trustee. The name and business address of the
Delaware Trustee in the State of Delaware is Delaware Trust Capital
Management, Inc., Three Beaver Valley Road, 4th Floor, Wilmington,
Delaware 19803.
(c) Series Trust. The Trust shall be a series trust and the
debts, liabilities, obligations and expenses incurred, contracted for
or otherwise existing with respect to a particular series shall be
enforceable against the assets of such series only, and not against
the assets of the Trust generally.
(d) Effective Date. This Certificate of Trust shall be effective
upon filing.
IN WITNESS WHEREOF, the undersigned, being the sole trustees of the
Trust, have executed this Certificate of Trust as of the date first above
written.
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
as Delaware Trustee
By:
-----------------------------------------
Name:
Title:
RTRT, INC.,
as Trustee
By:
-----------------------------------------
Name:
Title:
A-1
<PAGE> 55
EXHIBIT B
THIS UTI CERTIFICATE MAY NOT BE TRANSFERRED OR
ASSIGNED EXCEPT UPON THE TERMS AND SUBJECT TO THE
CONDITIONS SPECIFIED HEREIN.
RYDER TRUCK RENTAL LT
UNDIVIDED TRUST INTEREST CERTIFICATE
evidencing a fractional undivided interest in the UTI Assets of Ryder
Truck Rental LT, a business trust organized pursuant to the Delaware
Business Trust Act (the "Trust").
(This Certificate does not represent any interest in the SUBI Assets
of the Trust or an obligation of, or an interest in, Ryder Truck
Rental I LP, Ryder Truck Rental II LP, Ryder Truck Rental, Inc., RTRT,
Inc. or any of their respective Affiliates.)
Percentage Interest: [99%][1%]
Number U-____
THIS CERTIFIES THAT ______________________________ is the registered
owner of a nonassessable, fully-paid, fractional undivided [99%] [1%] interest
in the UTI Assets of the Trust. The Trust was created pursuant to a trust
agreement, dated as of June 1, 1997 (as amended, restated or supplemented from
time to time the "Agreement"), among Ryder Truck Rental I LP and Ryder Truck
Rental II LP, each a Delaware limited partnership, as grantors and initial
beneficiaries (in such capacities, the "Grantors" and the "UTI Beneficiaries",
respectively), Ryder Truck Rental, Inc., a Florida corporation, as
administrative agent (the "Administrative Agent"), RTRT, Inc., a Delaware
corporation, as trustee (the "Trustee"), Delaware Trust Capital Management,
Inc., a Delaware banking corporation, as Delaware trustee (the "Delaware
Trustee"), and, for certain limited purposes set forth therein, U.S. Bank
National Association, a national banking association, as trust agent (the
"Trust Agent"). A summary of certain provisions of the Agreement is set forth
below. Capitalized terms used herein that are not otherwise defined shall have
the meanings ascribed thereto in the Agreement.
This UTI Certificate is one of the duly authorized Certificates issued
under the Agreement and designated as "Ryder Truck Rental LT Undivided Trust
Interest Certificates" (the "UTI Certificates"). This UTI Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
a copy of which may be examined by the Holder hereof during normal business
hours at the principal office of the Trustee, or at such other place as may be
designated by the Trustee. By acceptance of this UTI Certificate, the Holder
hereof assents to the terms and conditions of the Agreement and agrees to be
bound thereby.
This UTI Certificate represents an ownership interest in the
"undivided trust interest" (the "UTI") in the Trust. The UTI constitutes an
undivided beneficial interest in all Trust Assets that have not been allocated
from time to time to a special unit of beneficial interest (each, a "SUBI") in
the Trust (the "UTI Assets"). The UTI does not evidence a direct interest in
the UTI Assets, nor does it represent a beneficial interest in any Trust Assets
other than the UTI Assets. The rights of the Holder of this UTI Certificate
with respect to the UTI Assets, including distributions in respect thereof, are
set forth in the Agreement.
B-1
<PAGE> 56
The Trust Assets consist generally of cash capital, Vehicles, Leases,
including all of Ryder's rights as Lessor thereunder, such other assets as may
from time to time be designated as "Trust Assets" under the Agreement and all
proceeds of the foregoing.
Pursuant to the Agreement, the Trustee will, from time to time, at the
direction of the UTI Beneficiaries and subject to the satisfaction of certain
conditions, establish one or more SUBIs and allocate or cause to be allocated
to each such SUBI on the books and records of the Trust such Trust Assets (the
"SUBI Assets") as shall have been identified to such SUBI by the UTI
Beneficiaries. Upon allocation to a SUBI, the related SUBI Assets will no
longer be UTI Assets unless and until reallocated to the UTI. Each SUBI will be
represented by one or more Certificates (each, a "SUBI Certificate")
distributed to or upon the order of the UTI Beneficiaries.
The UTI and each SUBI will each constitute a separate series of the
Trust pursuant to Section 3806(b)(2) of the Delaware Act for which separate and
distinct records will be maintained.
The UTI Certificates are limited in right of payment to certain
collections and recoveries in respect of Trust Assets not allocated to any
SUBI, all to the extent and as more specifically set forth in the Agreement.
By accepting this UTI Certificate, the Holder hereof expressly (i)
waives any Claim to any proceeds or assets of the Trustee and to all Trust
Assets other than UTI Assets and proceeds thereof and (ii) subordinates in
favor of each Holder of a SUBI Certificate any Claim to any related SUBI Asset
that, notwithstanding clause (i) of this sentence, may be determined to exist.
The Agreement, including the terms of this UTI Certificate, may be
amended or supplemented by written agreement upon the terms and subject to the
conditions set forth in the Agreement.
If approval by the Holder of this UTI Certificate is required for any
amendment or supplement to the Agreement or this UTI Certificate, any such
approval will be conclusive and binding upon such Holder and all future Holders
hereof and upon the Holders of any UTI Certificate issued upon the permitted
transfer or exchange hereof, whether or not notation of such consent is made on
this UTI Certificate or on any UTI Certificate issued upon any such permitted
transfer or exchange.
Neither the UTI nor any UTI Certificate may be transferred or
assigned, except upon the terms and subject to the conditions set forth in the
Agreement. To the fullest extent permitted by applicable law, any purported
transfer or assignment of the UTI or any UTI Certificate not complying with
such requirements will be deemed null, void and of no effect under the
Agreement. Without limitation of the foregoing, the UTI or one or more UTI
B-2
<PAGE> 57
Certificates may be pledged in connection with a Securitized Financing, and a
security interest therein granted, and may be transferred or assigned
absolutely to or by the pledgee thereof solely in connection with the exercise
of remedies with respect to an Event of Default under or with respect to such
Securitized Financing; provided, that any such pledgee must (i) give a
non-petition covenant as provided in the Agreement and (ii) execute an
agreement in favor of the Holders from time to time of any SUBI Certificates to
release all Claims to the related SUBI Assets and, in the event such release is
not given effect, to fully subordinate all Claims it may be deemed to have
against the related SUBI Assets.
Any permitted transfer of this UTI Certificate is registrable upon
surrender of this UTI Certificate for registration of transfer at the corporate
trust office of the Trustee (or the Trust Agent, if applicable), accompanied by
a written instrument of transfer in form satisfactory to the Trustee, duly
executed by the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new UTI Certificates of a like aggregate
fractional undivided interest will be issued to the designated permitted
transferee.
Prior to due presentation of this UTI Certificate for registration of
a permitted transfer, the Trustee, the certificate registrar and any of their
respective agents may treat the Person in the name of which this UTI
Certificate is registered as the owner hereof for the purpose of receiving
distributions and for all other purposes and, except as otherwise provided in
the Agreement, neither the Trustee, the certificate registrar nor any such
agent will be affected by any notice to the contrary.
The Trust or the UTI may terminate upon the terms and subject to the
conditions set forth in the Agreement. The UTI Certificates will be cancelled
upon delivery to the Trustee following termination of the UTI.
Unless this UTI Certificate shall have been executed and authenticated
by an authorized officer of the Trustee, by manual signature, this UTI
Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
B-3
<PAGE> 58
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this UTI Certificate to be duly executed.
Dated: _________, 1998 RYDER TRUCK RENTAL LT
By: RTRT, INC.,
as Trustee
By:
---------------------------------
Name:
Title:
This is one of the UTI Certificates referred to in the
within-mentioned Agreement.
RTRT, INC.,
as Trustee
By:
---------------------------------
Name:
Title:
B-4
<PAGE> 1
Exhibit 10.2
================================================================================
RYDER TRUCK RENTAL I LP
and
RYDER TRUCK RENTAL II LP,
as Grantors and UTI Beneficiaries,
RYDER TRUCK RENTAL, INC.,
as Administrative Agent,
RTRT, INC.,
as Trustee,
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
as Delaware Trustee,
and
U.S. BANK NATIONAL ASSOCIATION,
as Trust Agent
-------------------------------------------------------
1999-A
ORIGINATION TRUST
SUPPLEMENT
Dated as of October 1, 1999
-------------------------------------------------------
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Recitals..........................................................................................................1
ARTICLE ELEVEN
DEFINITIONS
Section 11.01. Definitions........................................................................................2
Section 11.02. Interpretive Provisions............................................................................6
Section 11.03. Rights in Respect of the 1999-A SUBIs..............................................................6
ARTICLE TWELVE
CREATION OF THE 1999-A SUBIS
Section 12.01. Creation of 1999-A SUBI Assets and the 1999-A SUBIs................................................7
Section 12.02. Transfer of 1999-A SUBI Interests..................................................................8
Section 12.03. Issuance and Form of 1999-A SUBI Certificates; Retained SUBI Interest..............................8
Section 12.04. Actions and Filings................................................................................9
Section 12.05. Termination of the 1999-A SUBIs....................................................................9
Section 12.06. Representations and Warranties of Trustee.........................................................10
ARTICLE THIRTEEN
1999-A SUBI ACCOUNTS
Section 13.01. 1999-A SUBI Collection Account and Residual Value Surplus Account.................................11
Section 13.02. Reserve Fund......................................................................................11
Section 13.03. Investment of Monies in 1999-A SUBI Accounts......................................................11
ARTICLE FOURTEEN
1999-A SUBI PLEDGE
Section 14.01. Registration of 1999-A Lease SUBI Pledge..........................................................12
</TABLE>
<PAGE> 3
ARTICLE FIFTEEN
MISCELLANEOUS PROVISIONS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 15.01. Amendment.........................................................................................12
Section 15.02. Governing Law.....................................................................................13
Section 15.03. Notices...........................................................................................13
Section 15.04. Severability of Provisions........................................................................13
Section 15.05. Effect of Supplement on Origination Trust Agreement...............................................14
Section 15.06. No Petition.......................................................................................14
EXHIBITS
Exhibit A - Schedule of 1999-A Vehicles.......................................................................A-1
Exhibit B - Form of 1999-A SUBI Certificate...................................................................B-1
</TABLE>
ii
<PAGE> 4
1999-A ORIGINATION TRUST SUPPLEMENT
This 1999-A Origination Trust Supplement, dated as of October 1, 1999,
is among Ryder Truck Rental I LP and Ryder Truck Rental II LP, each a Delaware
limited partnership, as grantors and initial beneficiaries (in such capacities,
the "Grantors" and the "UTI Beneficiaries", respectively), Ryder Truck Rental,
Inc., a Florida corporation ("Ryder"), as administrative agent (in such
capacity, the "Administrative Agent"), RTRT, Inc., a Delaware corporation, as
trustee (the "Trustee"), Delaware Trust Capital Management, Inc., a Delaware
banking corporation, as Delaware trustee (the "Delaware Trustee"), and U.S. Bank
National Association, a national banking association ("U.S. Bank"), as trust
agent (in such capacity, the "Trust Agent").
RECITALS
WHEREAS, pursuant to that certain second amended and restated trust
agreement, dated as of February 1, 1998 (the "Origination Trust Agreement"),
among the parties hereto, Ryder Truck Rental LT, a Delaware business trust (the
"Trust"), will take assignments and conveyances of and hold in trust various
Trust Assets (as such term is defined in the Origination Trust Agreement);
WHEREAS, the UTI Beneficiaries, the Administrative Agent, Ryder, as
maintenance provider (in such capacity, the "Maintenance Provider"), and the
Trust have entered into that certain administration agreement, dated as of
February 1, 1998 (the "Basic Administration Agreement"), which provides for,
among other things, the servicing of the Trust Assets by the Administrative
Agent;
WHEREAS, pursuant to the Origination Trust Agreement, from time to time
the Trustee, on behalf of the Trust and at the direction of the UTI
Beneficiaries, will identify and allocate on the books and records of the Trust
certain Trust Assets and create and issue one or more special units of
beneficial interest (each, a "SUBI"), the beneficiaries of which generally will
be entitled to the net cash flows arising from such Trust Assets;
WHEREAS, the parties hereto desire to supplement the Origination Trust
Agreement (as so supplemented by this Supplement, the "SUBI Trust Agreement") to
create two SUBIs (respectively, the "1999-A Lease SUBI" and the "1999-A Vehicle
SUBI);
WHEREAS, the parties hereto desire to identify and allocate to the
1999-A Lease SUBI a separate portfolio of Trust Assets consisting of leases (the
"1999-A Leases") and certain other related assets and to identify and allocate
to the 1999-A Vehicle SUBI the vehicles which are leased under the 1999-A Leases
(the "1999-A Vehicles"); and
WHEREAS, the parties hereto also desire to issue two certificates
evidencing a 99% and a 1% beneficial interest in the 1999-A Lease SUBI
(respectively, the "99% 1999-A Lease SUBI Certificate" and the "1% 1999-A Lease
SUBI Certificate", and, collectively, the "1999-A Lease SUBI Certificates") and
two certificates evidencing a 99% and a 1% undivided beneficial interest in the
1999-A Vehicle SUBI (respectively, the "99% 1999-A Vehicle SUBI Certificate" and
the
<PAGE> 5
"1% 1999-A Vehicle SUBI Certificate", and, collectively, the "1999-A Vehicle
SUBI Certificates").
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE ELEVEN
DEFINITIONS
Section 11.01. DEFINITIONS. Capitalized terms used herein that are not
otherwise defined shall have the meanings ascribed thereto in the Origination
Trust Agreement. Whenever used herein, unless the context otherwise requires,
the following words and phrases shall have the following meanings:
"ADMINISTRATION AGREEMENT" means the Basic Administration Agreement as
supplemented by the Administration Supplement, as amended or supplemented from
time to time.
"ADMINISTRATION SUPPLEMENT" means that certain supplement, dated as of
October 1, 1999, among the parties to the Basic Administration Agreement.
"ADMINISTRATIVE FEE" has the meaning set forth in the Administration
Supplement.
"BACK-UP SECURITY AGREEMENT" has the meaning set forth in the
Indenture.
"BASIC ADMINISTRATION AGREEMENT" has the meaning set forth in the
Recitals.
"BASIC DOCUMENTS" means the Origination Trust Agreement, the Basic
Administration Agreement, this Supplement, the Administration Supplement, the
SUBI Certificate Transfer Agreement, the Program Operating Lease, the Trust
Agreement, the Indenture, the Issuer SUBI Certificate Transfer Agreement, the
Control Agreement, the Back-up Security Agreement, the 1999-A SUBI Certificates,
the Lease Contribution Agreement and the Securities, as the same may be amended,
supplemented or modified from time to time (but in each case only to the extent
that any such amendment, supplement or modification relates to the 1999-A SUBIs
or the 1999-A SUBI Assets).
"CERTIFICATE DISTRIBUTION ACCOUNT" has the meaning set forth in the
Trust Agreement.
"CLOSING DATE" means ____________, 1999.
"CONTROL AGREEMENT" has the meaning set forth in the Issuer SUBI
Certificate Transfer Agreement.
"CUTOFF DATE" means October 1, 1999 as of the opening of business.
2
<PAGE> 6
"DCR" means Duff & Phelps Credit Rating Co.
"DEPOSIT DATE" means, with respect to a Collection Period, the Business
Day preceding the related Payment Date.
"ELIGIBLE LEASE" means a Lease that, in addition to meeting the
definition of "Eligible Lease" in the Origination Trust Agreement, is also a
Lease that (i) does not have a monthly Fixed Charge payment that is more than 60
days past due as of the Cutoff Date, (ii) has been validly assigned to the Trust
by Ryder as of the Closing Date and for which the related 1999-A Vehicle is one
which the Trust or the Trustee on behalf of the Trust shall have good and
marketable title as of the Closing Date; provided, that any 1999-A Vehicles
owned by Ryder as of the Closing Date may be retitled in the name of the Trust
or the Trustee on behalf of the Trust during the Titling Grace Period, (iii) is
not an obligation of the United States or any State or any agency thereof, (iv)
as to which the aggregate remaining Fixed Charge due is equal to or greater than
the aggregate remaining Financial Component due in respect thereof or (v) is a
Lease as to which no provision thereof relating to the amount of the Financial
Component has been waived.
"INDENTURE" means that certain indenture, dated as of October 1, 1999,
between the Indenture Trustee and the Issuer, as amended or supplemented from
time to time.
"INDENTURE TRUSTEE" means U.S. Bank, in its capacity as trustee under
the Indenture.
"ISSUER" means the Ryder Vehicle Lease Trust 1999-A.
"ISSUER SUBI CERTIFICATE TRANSFER AGREEMENT" means that certain issuer
SUBI certificate transfer agreement, dated as of October 1, 1999, between the
Transferor and the Issuer, as amended or supplemented from time to time.
"LEASE CONTRIBUTION AGREEMENT" means that certain lease contribution
agreement, dated as of October 1, 1999, between Ryder and the Origination Trust.
"1999-A LEASE SUBI " has the meaning set forth in Section 12.01(a).
"1999-A LEASE SUBI ASSETS" has the meaning set forth in Section
12.01(a).
"1999-A LEASE SUBI CERTIFICATES" has the meaning set forth in the
Recitals.
"1999-A LEASES" has the meaning set forth in Section 12.01(a).
"1999-A SUBI" means the 1999-A Lease SUBI and/or the 1999-A Vehicle
SUBI as the context may require.
"1999-A SUBI ACCOUNT" means the 1999-A SUBI Collection Account, the
Residual Value Surplus Account and any other Trust Account established with
respect to the 1999-A SUBI.
"1999-A SUBI ASSETS" has the meaning set forth in Section 12.01(b).
3
<PAGE> 7
"1999-A SUBI CERTIFICATES" means the 1999-A Lease SUBI Certificates
and/or the 1999-A Vehicle SUBI Certificates, as the context may require.
"1999-A SUBI COLLECTION ACCOUNT" means the trust account established
pursuant to Section 13.01(a).
"1999-A VEHICLE SUBI" has the meaning set forth in Section 12.01(b).
"1999-A VEHICLE SUBI ASSETS" has the meaning set forth in Section
12.01(b).
"1999-A VEHICLE SUBI CERTIFICATES" has the meaning set forth in the
Recitals.
"1999-A VEHICLES" has the meaning set forth in Section 12.01(b).
"99% 1999-A LEASE SUBI CERTIFICATE" has the meaning set forth in the
Recitals.
"99% 1999-A SUBI CERTIFICATES" means the 99% 1999-A Lease SUBI
Certificate and the 99% 1999-A Vehicle SUBI Certificate.
"99% 1999-A VEHICLE SUBI CERTIFICATE" has the meaning set forth in the
Recitals.
"NOTE" means either a Senior Note or a Subordinated Note, as the
context may require.
"NOTE DISTRIBUTION ACCOUNT" has the meaning set forth in the Indenture.
"1% 1999-A LEASE SUBI CERTIFICATE" has the meaning set forth in the
Recitals.
"1% 1999-A VEHICLE SUBI CERTIFICATE" has the meaning set forth in the
Recitals.
"ORIGINATION TRUST AGREEMENT" has the meaning set forth in the
Recitals.
"OTHER SUBI" means any SUBI other than a 1999-A SUBI.
"OUTSTANDING AMOUNT" has the meaning set forth in the Indenture.
"OWNER TRUSTEE" means Chase Manhattan Bank Delaware, a Delaware
corporation, as trustee of the Issuer.
"PAYMENT DATE" means January 15, April 15, July 15 and October 15 of
each year, and, if necessary, the Senior Note Final Payment Date, or, if any
such day is not a Business Day, the immediately succeeding Business Day,
commencing January 17, 2000.
"PAYMENT DATE CERTIFICATE" has the meaning set forth in the Indenture.
"PAYMENT DATE ADVANCE REIMBURSEMENT" has the meaning set forth in the
Administration Supplement.
4
<PAGE> 8
"PROGRAM OPERATING LEASE" means that certain SUBI lease, dated as of
October 1, 1999, between Ryder Funding LP, as Program Lessee and Ryder Vehicle
Lease Trust 1999-A, as Program Lessor.
"RATING AGENCY" means, with respect to the 1999-A SUBIs, each of
Moody's and DCR.
"RELATED BENEFICIARY" means each of Ryder Truck Rental II LP and Ryder
Funding LP.
"RESERVE FUND" has the meaning set forth in the Trust Agreement.
"RESIDUAL VALUE SURPLUS ACCOUNT" means the trust account established
and maintained pursuant to Section 13.01(a)(ii).
"SALES PROCEEDS" has the meaning set forth in the Administration
Agreement.
"SECURITIES" means the Notes and the Trust Certificates.
"SECURITIZATION VALUE" has the meaning set forth in the Administration
Supplement.
"SECURITYHOLDER" means a holder of a Note or a Trust Certificate.
"SENIOR NOTE" has the meaning set forth in the Indenture.
"SUBI" has the meaning set forth in the Recitals.
"SUBI CERTIFICATE TRANSFER AGREEMENT" means that certain SUBI
certificate transfer agreement, dated as of October 1, 1999, between Ryder Truck
Rental I LP and the Transferor as amended or supplemented from time to time.
"SUBI COLLECTIONS" has the meaning set forth in the Administration
Agreement.
"SUBI TRUST AGREEMENT" has the meaning set forth in the Recitals.
"SUBORDINATED NOTES" means the ____% Asset Backed Subordinated Notes
issued by the Issuer pursuant to the Trust Agreement.
"SUPPLEMENT" means this supplement to the Origination Trust Agreement,
as amended or supplemented from time to time.
"TITLING GRACE PERIOD" means 60 days after the Closing Date.
"TRANSFEROR" means Ryder Funding LP, a Delaware limited partnership,
and its successors.
"TRANSFEROR TRUST CERTIFICATE" has the meaning set forth in the Trust
Agreement.
"TRUST" has the meaning set forth in the Recitals.
5
<PAGE> 9
"TRUST AGREEMENT" means that certain trust agreement, as amended and
restated as of October 1, 1999, between the Owner Trustee and the Transferor.
"TRUST CERTIFICATE" has the meaning set forth in the Trust Agreement.
"TRUST CERTIFICATEHOLDER" has the meaning set forth in the Trust
Agreement.
"TRUSTEE" has the meaning set forth in the Recitals.
"UTI BENEFICIARIES" has the meaning set forth in the Recitals.
Section 11.02. INTERPRETIVE PROVISIONS. For all purposes of this
Supplement, except as otherwise expressly provided or unless the context
otherwise requires, (i) terms used herein include, as appropriate, all genders
and the plural as well as the singular, (ii) references to this Supplement
include all Exhibits hereto, (iii) references to words such as "herein",
"hereof" and the like shall refer to this Supplement as a whole and not to any
particular part, Article or Section herein, (iv) references to an Article or
Section such as "Article Twelve" or "Section 12.01" shall refer to the
applicable Article or Section of this Supplement, (v) the term "include" and all
variations thereof shall mean "include without limitation," (vi) the term "or"
shall include "and/or" and (vii) the term "proceeds" shall have the meaning
ascribed to such term in the UCC.
Section 11.03. RIGHTS IN RESPECT OF THE 1999-A SUBIs. Each Holder and
Registered Pledgee of a 1999-A SUBI Certificate (including the Issuer) is a
third-party beneficiary of the Origination Trust Agreement (including this
Supplement) insofar as the Origination Trust Agreement and this Supplement apply
to the 1999-A SUBIs and the Holders and Registered Pledgees of 1999-A SUBI
Certificates. Therefore, to that extent, references in the SUBI Trust Agreement
to the ability of any "Holder of a SUBI Certificate", "Registered Pledgee of a
SUBI Certificate" or the like to take any action shall be deemed to refer to the
Issuer acting at its own instigation or upon the instruction of the requisite
voting percentage of holders of Securities or Rated Securities, as specified in
the Indenture or the Trust Agreement, as applicable.
6
<PAGE> 10
ARTICLE TWELVE
CREATION OF THE 1999-A SUBIs
Section 12.01. CREATION OF 1999-A SUBI ASSETS AND THE 1999-A SUBIs.
(a) Pursuant to Section 3.01(a) of the Origination Trust Agreement, the
UTI Beneficiaries hereby direct the Trustee to identify and allocate or to cause
to be identified and allocated to the 1999-A Lease SUBI on the books and records
of the Trust a separate Sub-Trust of Trust Assets consisting of Eligible Leases
and other associated Trust Assets owned by the Trustee on behalf of the Trust
and not allocated to any SUBI or reserved for allocation to any Other SUBI (or
acquired by the Trustee on behalf of the Trust but not yet allocated to, or
reserved for allocation to any specific Sub-Trust). Such Trust Assets (the
"1999-A Lease SUBI Assets") shall be accounted for and held in trust
independently from all other Trust Assets within the Trust. Based upon their
identification and allocation by the Administrative Agent pursuant to the
Administration Supplement, the Trustee hereby identifies and allocates as 1999-A
Lease SUBI Assets the Leases more particularly described on Exhibit A hereto
("the 1999-A Leases") and the related Trust Assets described above, each such
1999-A Lease SUBI Asset to be identified on the books and accounts of the Trust
as being allocated to the 1999-A Lease SUBI.
(b) Pursuant to Section 3.01(a) of the Origination Trust Agreement, the
UTI Beneficiaries hereby direct the Trustee to identify and allocate or to cause
to be identified and allocated to the 1999-A Vehicle SUBI on the books and
records of the Trust a separate Sub-Trust of Trust Assets consisting of Vehicles
and other associated Trust Assets owned by the Trustee on behalf of the Trust
and not allocated to any SUBI or reserved for allocation to any Other SUBI (or
acquired by the Trustee on behalf of the Trust but not yet allocated to, or
reserved for allocation to any specific Sub-Trust). Such Trust Assets (the
"1999-A Vehicle SUBI Assets", and together with the 1999-A Lease SUBI Assets,
the "1999-A SUBI Assets) shall be accounted for and held in trust independently
from all other Trust Assets within the Trust. Based upon their identification
and allocation by the Administrative Agent pursuant to the Administration
Supplement, the Trustee hereby identifies and allocates as 1999-A Vehicle SUBI
Assets the Vehicles more particularly described on Exhibit A hereto ("the 1999-A
Vehicles") and the related Trust Assets described above, each such 1999-A
Vehicle SUBI Asset to be identified on the books and accounts of the Trust as
being allocated to the 1999-A Lease SUBI.
Notwithstanding anything to the contrary in the SUBI Trust Agreement,
all 1999-A Vehicles not titled in the name of the Trust or the Trustee on behalf
of the Trust as of the Closing Date shall be so titled during the Titling Grace
Period, and Ryder shall provide each Rating Agency with a report on the status
of such retitling on or before the end of the Titling Grace Period.
(c) Pursuant to Section 3.01(a) of the Origination Trust Agreement, the
Trustee hereby creates two Sub-Trusts which shall be known as the "1999-A Lease
SUBI" and the "1999-A Vehicle SUBI" respectively. The 1999-A Lease SUBI shall
represent a special unit of beneficial interest solely in the 1999-A Lease SUBI
Assets and the 1999-A Vehicle SUBI shall
7
<PAGE> 11
represent a special unit of beneficial interest solely in the 1999-A SUBI
Vehicle Assets. Exhibit A shall set forth as to each 1999-A Lease or 1999-A
Vehicle, as the case may be, the (i) vehicle identification number, (ii) date of
origination, (iii) Net Book Value, (iv) Residual Value, (v) Financial Component,
(vi) Fixed Charge and (vii) number of months remaining from the Cutoff Date to
the month in which the Maturity Date occurs.
Section 12.02. TRANSFER OF 1999-A SUBI INTERESTS. Interests in the
1999-A SUBIs may not be transferred or assigned by the UTI Beneficiaries, and
any such purported transfer or assignment shall be deemed null, void and of no
effect herewith; provided, however, that the 1999-A SUBI Certificates and the
interests in the 1999-A SUBI represented thereby may be (i) sold to the
Transferor pursuant to the SUBI Certificate Transfer Agreement and (ii) sold,
transferred and assigned by the Transferor absolutely, or a security interest
therein granted, in connection with a Securitized Financing, in each case in the
circumstances contemplated in Section 3.02(d) of the Origination Trust
Agreement. Each such transfer shall be registrable upon surrender of the 1999-A
SUBI Certificate to be transferred for registration of the transfer at the
corporate trust office of the Trustee (or the Trust Agent, if applicable) or of
any successor Trustee, accompanied by a written instrument of transfer in form
satisfactory to the Trustee or such successor duly executed by the Holder
thereof or such Holder's attorney duly authorized in writing, and thereupon a
new 1999-A SUBI Certificate of a like aggregate fractional undivided interest
will be issued to the designated permitted transferee.
Section 12.03. ISSUANCE AND FORM OF 1999-A SUBI CERTIFICATES; RETAINED
SUBI INTEREST.
(a) The 1999-A Lease SUBI shall be represented by two 1999-A SUBI
Certificates, the 99% 1999-A Lease SUBI Certificate and the 1% 1999-A Lease SUBI
Certificate, each of which shall represent a beneficial interest in the 1999-A
Lease SUBI and the 1999-A Lease SUBI Assets, as further set forth herein. The
1999-A Vehicle SUBI shall be represented by two 1999-A SUBI Certificates, the
99% 1999-A Vehicle SUBI Certificate and the 1% 1999-A Vehicle SUBI Certificate,
each of which shall represent a beneficial interest in the 1999-A Vehicle SUBI
and the 1999-A Vehicle SUBI Assets, as further set forth herein. The 1999-A SUBI
Certificates shall be substantially in the form of Exhibit B attached hereto,
with such appropriate insertions, omissions, substitutions and other variations
as are required by this Supplement and may have such letters, numbers or other
marks of identification and such legends and endorsements placed thereon as may,
consistently herewith and with the Origination Trust Agreement, be directed by
the UTI Beneficiaries. Any portion of any 1999-A SUBI Certificate may be set
forth on the reverse thereof, in which case the following reference to the
portion of the text on the reverse shall be inserted on the face thereof, in
relative proximity to and prior to the signature of the Trustee executing such
1999-A SUBI Certificate:
Reference is hereby made to the further provisions of this
certificate set forth on the reverse hereof, which provisions
shall for all purposes have the same effect as if set forth at
this place.
8
<PAGE> 12
The 1999-A SUBI Certificates shall be printed, lithographed,
typewritten, mimeographed, photocopied or otherwise produced or may be produced
in any other manner as may, consistently herewith and with the Origination Trust
Agreement, be determined by the UTI Beneficiaries. Each 1999-A SUBI Certificate
and the interest in the 1999-A SUBI evidenced thereby shall constitute a
"security" within the meaning of Section 8-102(a)(15) of the UCC and a
"certificated security" within the meaning of Section 8-102(a)(4) of the UCC.
(b) Until the 1999-A SUBIs have been terminated, the UTI Beneficiaries
shall at all times maintain with respect to each 1999-A SUBI a minimum of a 1%
interest in the 1999-A SUBI and the related 1999-A SUBI Assets, including (i) a
1% interest in each material item of income, gain, loss, deduction or credit
with respect to the 1999-A SUBIs and 1999-A SUBI Assets and (ii) a capital
account balance (or capital investment) in the 1999-A SUBIs and 1999-A SUBI
Assets of at least equal to 1% of the aggregate capital account balances (or
capital investments) therein. Such requirement may be satisfied by the UTI
Beneficiaries, or either of them, owning the 1% 1999-A SUBI Certificates.
(c) On the Closing Date, pursuant to Section 3.04(a) of the Origination
Trust Agreement, the Indenture Trustee shall, and thereafter for so long as the
lien of the Indenture is in place, be registered as the Registered Pledgee of
the 99% 1999-A Vehicle SUBI Certificate held by the Issuer and pledged as part
of the Trust Estate to secure the Issuer's obligations under the Indenture. As
the Registered Pledgee, the Indenture Trustee shall be entitled to exercise any
and all rights or powers of a Holder hereunder, to the extent set forth in
Section 6.12 of the Indenture.
Section 12.04. ACTIONS AND FILINGS. The UTI Beneficiaries and the
Trustee shall undertake all other and future actions and activities as may be
deemed reasonably necessary by the Administrative Agent pursuant to the
Administration Agreement to perfect (or evidence) and confirm the foregoing
allocations of Trust Assets to each 1999-A SUBI, including filing or causing to
be filed UCC financing statements and executing and delivering all related
filings, documents or writings as may be deemed reasonably necessary by the
Administrative Agent hereunder or under any other Basic Document. The UTI
Beneficiaries hereby irrevocably make and appoint each of the Trustee and the
Administrative Agent, and any of their respective officers, employees or agents,
as the true and lawful attorney-in-fact of the UTI Beneficiaries (which
appointment is coupled with an interest and is irrevocable) with power to sign
on behalf of the UTI Beneficiaries any financing statements, continuation
statements, security agreements, mortgages, assignments, affidavits, letters of
authority, notices or similar documents necessary or appropriate to be executed
or filed pursuant to this Section.
Section 12.05. TERMINATION OF THE 1999-A SUBIs.
(a) In connection with any purchase by the Transferor of the corpus of
the Issuer pursuant to Article Nine of the Trust Agreement, the succession of
the Transferor to the interest in the 1999-A Vehicle SUBI represented by the 99%
1999-A Vehicle SUBI Certificate and the discharge and release of the pledge by
the Transferor to the Issuer of the 99% 1999-A Lease SUBI Certificate, should
all of the interest in each 1999-A SUBI thereafter be held by the
9
<PAGE> 13
Holders of the UTI Certificates, whether by transfer, sale or otherwise, then
upon the direction of such Holders, each 1999-A SUBI shall be terminated, the
1999-A SUBI Certificates shall be returned to the Trustee and canceled and the
Administrative Agent shall reallocate all 1999-A SUBI Assets to the UTI.
(b) In the event that a bankruptcy or insolvency shall occur with
respect to the Transferor or upon the sale of the Trust Estate pursuant to
Section 5.04 of the Indenture, this Supplement shall terminate and each 1999-A
SUBI shall be terminated; provided however such termination shall affect the
Origination Trust only insofar as such termination relates to each 1999-A SUBI.
Such termination shall not entitle the legal representatives of the 1999-A SUBIs
or any Holder of a 1999-A SUBI Certificate to take any action for a partition or
winding up of the Trust or any Trust Assets except with respect to the 1999-A
SUBI Assets and the rights, obligations and Liabilities of the parties hereto
shall not otherwise be affected. Promptly after the occurrence of any
bankruptcy, insolvency or termination proceeding with respect to the Transferor,
the Transferor shall give the Indenture Trustee, the Owner Trustee and the
Rating Agencies written notice of such event. Upon the receipt of such notice or
actual knowledge of a termination pursuant to Section 9.02 of the Trust
Agreement, the Owner Trustee shall promptly sell or, if the Lien of the
Indenture is outstanding shall direct, the Indenture Trustee promptly to sell
the Trust Estate, including the 1999-A SUBI Assets (other than amounts on
deposit in the Distribution Accounts) in a commercially reasonable manner and on
commercially reasonable terms. In connection with any such sale, or the sale of
the Trust Estate pursuant to Section 5.04 of the Indenture, the 1999-A SUBI
Assets shall be distributed out of the Origination Trust at the direction of the
Owner Trustee or the Indenture Trustee, as applicable, and the purchaser shall
take delivery of such 1999-A SUBI Assets. The Origination Trustee and the other
parties hereto shall cooperate with the Owner Trustee or the Origination
Trustee, as applicable, to cause the related 1999-A Vehicles to be retitled as
directed by the purchaser. The proceeds of such sale shall be distributed in the
following amounts and priority:
(i) to the Indenture Trustee, all amounts required to be
paid under Section 6.07 of the Indenture or to the Owner Trustee, all
amounts required to be paid under Section 8.01 of the Trust Agreement,
as the case may be;
(ii) to the Administrative Agent, any Payment Date Advance
Reimbursement;
(iii) to the Administrative Agent, amounts due in respect
of unpaid Administration Fees; and
(iv) any remaining amounts shall be distributed pro rata to
the Holders of the SUBI Certificates: (A) to an account specified by
the Holder of the 1% 1999-A SUBI Certificate and (B) to the Certificate
Distribution Account (or, if the lien of the Indenture is outstanding,
the Note Distribution Account) and distributed pursuant to Section
5.04(b) of the Indenture.
Section 12.06. REPRESENTATIONS AND WARRANTIES OF TRUSTEE. The Trustee
hereby reaffirms, as of the date hereof, the representations, warranties and
covenants set forth in Section 5.12 of the Origination Trust Agreement, on which
the Grantors and UTI Beneficiaries, each of
10
<PAGE> 14
their permitted assignees and pledgees and each Registered Pledgee and Holder or
Related Beneficiary of a 1999-A SUBI Certificate (and beneficial owner of any
portion thereof, including the Issuer and the Trust Certificateholders) may
rely. For purposes of the this Section, any reference in Section 5.12 of the
Origination Trust Agreement to the Origination Trust Agreement shall be deemed
to constitute references to the SUBI Trust Agreement.
ARTICLE THIRTEEN
1999-A SUBI ACCOUNTS
Section 13.01. 1999-A SUBI COLLECTION ACCOUNT AND RESIDUAL VALUE
SURPLUS ACCOUNT.
(a) With respect to the 1999-A SUBIs, the Trustee shall establish, and
the Trust Agent shall maintain, in the name of the Trustee, for the exclusive
benefit of the holders of interests in the 1999-A SUBIs, (i) the 1999-A SUBI
Collection Account, which account shall constitute a SUBI Collection Account and
(ii), a Residual Value Surplus Account. Each such 1999-A SUBI Account initially
shall be established with U.S. Bank, as Trust Agent, so long as the Trust Agent
has the Required Deposit Rating. If the Trust Agent at any time does not have
the Required Deposit Rating, the Administrative Agent shall, with the assistance
of the Trust Agent, as necessary, cause each such 1999-A SUBI Account to be
moved as described in Section 4.02(a) of the Origination Trust Agreement. Each
of the 1999-A SUBI Collection Account and the Residual Value Surplus Account
shall relate solely to the 1999-A SUBIs and the 1999-A SUBI Assets, and funds
therein shall not be commingled with any other monies, except as otherwise
provided for in or contemplated by the SUBI Trust Agreement or in the
Administration Agreement. All deposits into the 1999-A SUBI Collection Account
shall be made as described in Sections 2.06 and 11.04 of the Administration
Agreement.
(b) On each Deposit Date and Payment Date, pursuant to the instructions
from the Administrative Agent, the Trustee (acting through the Trust Agent)
shall make such deposits and withdrawals from the 1999-A SUBI Collection Account
and the Residual Value Surplus Account as set forth in the Administration
Supplement.
(c) Any transfer of funds to a Holder of a 99% 1999-A SUBI Certificate
shall be made as directed pursuant to the Basic Documents. Any transfer to a
Holder of a 1% 1999-A SUBI Certificate shall be made at the direction of such
Holder.
Section 13.02. RESERVE FUND. Pursuant to Section 5.01 of the Trust
Agreement, the Transferor shall establish and maintain the Reserve Fund (a) with
the Indenture Trustee, until the Outstanding Amount is reduced to zero, and (b)
thereafter with the Owner Trustee. Deposits and withdrawals from the Reserve
Fund shall be made as directed pursuant to the Basic Documents, including
Section 8.04(b) of the Indenture, Section 10.01of the Indenture, Section 11.04
of the Administration Agreement and Section 13.03 hereof.
Section 13.03. INVESTMENT OF MONIES IN 1999-A SUBI ACCOUNTS. All
amounts held in the 1999-A SUBI Collection Account and the Residual Value
Surplus Account shall be invested
11
<PAGE> 15
in Permitted Investments in accordance with Section 4.02(a) of the Origination
Trust Agreement. Any investment earnings on the 1999-A SUBI Collection Account
and the Residual Value Surplus Account will be taxable to the Transferor. On
each Payment Date, the Trustee shall deposit all net income or other gain from
the foregoing investments in respect of the related Collection Period into the
Reserve Fund.
ARTICLE FOURTEEN
1999-A SUBI PLEDGE
Section 14.01. REGISTRATION OF 1999-A LEASE SUBI PLEDGE.
(a) The Transferor hereby acknowledges and confirms the pledge and
assignment to the Issuer of the 99% 1999-A Lease SUBI Certificate and the grant
to the Issuer of a security interest therein pursuant to Section 2.04 of the
Program Operating Lease. The Transferor hereby notifies the Trustee that all of
the Issuer's right, title and interest with respect to such pledge, assignment
and grant of security interest has been assigned to the Indenture Trustee
pursuant to the Indenture and the Transferor hereby acknowledges such
assignment. The Issuer hereby directs the Trustee to cause to be listed in the
Certificate Register as the Registered Pledgee of the Transferor's 99% 1999-A
Lease SUBI Certificate (i) until the Outstanding Amount is reduced to zero, the
Indenture Trustee, and (ii) thereafter, the Issuer. The Transferor has caused
the Trustee to deliver the 99% 1999-A Lease SUBI Certificate to the Indenture
Trustee, as Registered Pledgee. Each such Registered Pledgee shall have the
rights with respect thereto described herein and in the Program Operating Lease.
(b) At such times and for so long as it is the Registered Pledgee, the
Indenture Trustee or the Issuer, as the case may be, shall be entitled to
exercise the rights of the Holder of the 99% 1999-A Lease SUBI Certificate and
the additional rights conferred upon it as Registered Pledgee. Following the
return of the 99% 1999-A Lease SUBI Certificate to the Issuer pursuant to
Section 10.01 of the Indenture and thereupon to the Transferor pursuant to
Section 9.03(a) of the Trust Agreement, the Transferor shall be entitled to
exercise the rights of the Holder of the 99% 1999-A Lease SUBI Certificate.
ARTICLE FIFTEEN
MISCELLANEOUS PROVISIONS
Section 15.01. AMENDMENT.
(a) This Supplement (and, accordingly, the Origination Trust Agreement
as it relates to the 1999-A SUBIs) may be amended by the parties hereto:
(i) without the consent of the Holders, to cure any
ambiguity, correct or supplement any provision herein that may be
inconsistent with any other provision
12
<PAGE> 16
herein, add any other provision with respect to matters or questions
arising hereunder that is not inconsistent with the SUBI Trust
Agreement or add or amend any provision herein to assure that none of
the Trust, the Issuer or the Transferor will be classified as an
association (or a publicly traded partnership) taxable as a corporation
for federal income tax purposes; provided, that any such action will
not, in the good faith judgment of the parties hereto, materially and
adversely affect the interest of any Holder; and
(ii) from time to time (including to change the manner in
which the Residual Value Surplus Account or the Reserve Fund is funded
or to eliminate the Residual Value Surplus Account or the Reserve Fund,
or to change the remittance schedule for depositing SUBI Collections
and other amounts into the 1999-A SUBI Collection Account), provided
that (A) (1) each Rating Agency provides confirmation to the Trustee to
the effect that such amendment would not cause its then-current rating
on any Rated Securities to be qualified, reduced or withdrawn or (2)
the related Holder provides notice of its consent thereto to the
Trustee and (B) an Opinion of Counsel is delivered to the Trustee to
the effect that after such amendment, for federal income tax purposes,
the Trust will not be treated as an association (or a publicly traded
partnership) taxable as a corporation and the Senior Notes will and the
Trust Certificates should properly be characterized as indebtedness
that is secured by the assets of the Issuer; to the extent that any
such amendment materially affects the UTI or any Other SUBI, the 1999-A
SUBI Certificates or the 1999-A SUBI Assets, such amendment shall
require the consent of the Holders affected thereby; in addition, to
the extent that (A) such amendment shall increase or reduce in any
manner the amount of, or accelerate or delay the timing of, collections
or payments in respect of a 1999-A SUBI or a 99% 1999-A SUBI
Certificate or distributions (or the interest or pass-through rate
thereon) required to be made on any Rated Securities or (B) reduce the
percentage of the aggregate principal amount of Rated Securities
required to consent to any such amendment, any such amendment shall
require the consent of all the Holders or holders of 100% of all
outstanding Rated Securities, as the case may be, and an Opinion of
Counsel as set forth in clause (B) above.
(b) Any amendment to this Supplement shall amend the Origination Trust
Agreement only insofar as such amendment relates to the 1999-A SUBIs.
Section 15.02. GOVERNING LAW. This Supplement shall be created under
and governed by and construed under the internal laws of the State of Delaware,
without regard to any otherwise applicable principles of conflict of laws.
Section 15.03. NOTICES. The notice provisions of Section 8.03 of the
Origination Trust Agreement shall apply equally to this Supplement. A copy of
each notice or other writing required to be delivered to the Trustee pursuant to
the SUBI Trust Agreement also shall be delivered to the Owner Trustee at the
following address: 1201 Market Street, Wilmington, Delaware 19801, Attention:
Corporate Trust Department (telecopier no. (302) 984-4903).
Section 15.04. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Supplement (including any
amendment hereto) shall be
13
<PAGE> 17
for any reason whatsoever held invalid, then such covenants,
agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this
Supplement, as the same may be amended, and shall in no way affect the
validity or enforceability of the other provisions of the SUBI Trust
Agreement or of any 1999-A SUBI Certificate or the rights of the
Holders or Registered Plegees thereof. To the extent permitted by
applicable law, the parties hereto waive any provision of law that
renders any covenant, agreement, provision or term of this Supplement,
as the same may be amended, invalid or unenforceable in any respect.
Section 15.05. EFFECT OF SUPPLEMENT ON ORIGINATION TRUST AGREEMENT.
(a) Except as otherwise specifically provided herein or unless the
context otherwise requires, (i) the parties hereto shall continue to be bound by
all provisions of the Origination Trust Agreement, (ii) all references in the
Origination Trust Agreement to the Origination Trust Agreement shall be to the
SUBI Trust Agreement and (iii) the provisions set forth herein shall operate
either as additions to or modifications of the extant obligations of the parties
under the Origination Trust Agreement, as the context may require. In the event
of any conflict between this Supplement and the Origination Trust Agreement in
respect of the 1999-A SUBIs, the provisions of this Supplement shall prevail.
(b) For purposes of determining the obligations of the parties hereto
under this Supplement with respect to the 1999-A SUBIs, except as otherwise
indicated by the context, general references in the Origination Trust Agreement
to (i) a SUBI Account shall be deemed to refer more specifically to a 1999-A
SUBI Account, (ii) a SUBI shall be deemed to refer more specifically to a 1999-A
SUBI, (iii) a SUBI Collection Account shall be deemed to refer more specifically
to the 1999-A SUBI Collection Account, (iv) a SUBI Asset shall be deemed to
refer more specifically to a 1999-A SUBI Asset, (v) a SUBI Supplement shall be
deemed to refer more specifically to this Supplement and (vi) an Administration
Supplement shall be deemed to refer more specifically to the Administration
Supplement.
Section 15.06. NO PETITION. Each of the parties hereto and each Holder
of, or each Registered Pledgee of, by acceptance of a 1999-A SUBI Certificate,
or in the case of the Registered Pledgee, by acceptance of the pledge of such
1999-A SUBI Certificate, covenants and agrees that prior to the date that is one
year and one day after the date upon which all obligations under each
Securitized Financing have been paid in full, it will not (and, to the fullest
extent permitted by applicable law, the Trustee shall not have the power to)
institute against, or join any other Person in instituting against, the
Grantors, the Trustee, the Trust, any Special Purpose Affiliate, any
Beneficiary, any general partner of a Beneficiary or of a Special Purpose
Affiliate that is a partnership or any member of a Beneficiary or Special
Purpose Affiliate (or any of their respective general partners) that is a
limited liability company, any bankruptcy, reorganization, arrangement,
insolvency or liquidation Proceeding or other Proceeding under any federal or
state bankruptcy or similar law. This Section shall survive the complete or
partial termination of this Supplement, the resignation or removal of the
Trustee and the complete or partial resignation or removal of the Administrative
Agent.
14
<PAGE> 18
IN WITNESS WHEREOF, the Grantors and UTI Beneficiaries, the
Administrative Agent, the Trustee, the Delaware Trustee and, solely for the
limited purposes set forth in Sections 13.01, 13.02, 13.03 and 13.04, the Trust
Agent, have caused this Supplement to be duly executed by their respective
officers as of the day and year first above written.
RYDER TRUCK RENTAL I LP,
as Grantor and UTI Beneficiary
By: RYDER TRUCK RENTAL I LLC,
as General Partner
By: RTR LEASING I, INC.,
as Manager
By:
-----------------------------------
Name:
Title:
RYDER TRUCK RENTAL II LP,
as Grantor and UTI Beneficiary
By: RYDER TRUCK RENTAL II LLC,
as General Partner
By: RTR LEASING I, INC.,
as Manager
By:
-----------------------------------
Name:
Title:
RYDER TRUCK RENTAL, INC.,
as Administrative Agent
By:
-----------------------------------
Name:
Title:
15
<PAGE> 19
RTRT, INC.,
as Trustee
By:
-----------------------------------
Name:
Title:
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
as Delaware Trustee
By:
-----------------------------------
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as Trust Agent
By:
-----------------------------------
Name:
Title:
Receipt of this original counterpart of this Agreement is hereby
acknowledged on this _____ day of __________ 1999.
U.S. BANK NATIONAL ASSOCIATION,
as Indenture Trustee
By:
-----------------------------------
Name:
Title:
16
<PAGE> 20
EXHIBIT A
SCHEDULE OF 1999-A LEASES AND 1999-A VEHICLES
[Omitted. Copies on file with the Administrative Agent, the Trustee and
the Owner Trustee.]
A-1
<PAGE> 21
EXHIBIT B
FORM OF 1999-A [LEASE] [VEHICLE] SUBI CERTIFICATE
RYDER TRUCK RENTAL LT
1999-A SPECIAL UNIT OF BENEFICIAL INTEREST CERTIFICATE
No. R-___
evidencing a fractional undivided [99%] [1%] interest in all 1999-A
[Lease][Vehicle]SUBI Assets (as defined below).
This 1999-A Special Unit of Beneficial Interest Certificate does not
represent an interest in or obligation of Ryder Truck Rental, Inc., RTRT, Inc.
or any of their respective affiliates, except to the extent described below.
THIS CERTIFIES THAT ________________ is the registered owner of a
nonassessable, fully-paid, [99%] [1%] fractional undivided interest in the
1999-A SUBI [Lease] [Vehicle] Assets owned by Ryder Truck Rental LT (the
"Trust").
The Trust was created pursuant to a trust agreement, dated as of June
1, 1997, as amended, supplemented or restated from time to time (the
"Origination Trust Agreement"), among Ryder Truck Rental I LP ("RTR I LP") and
Ryder Truck Rental II LP ("RTR II LP"), as grantors and initial beneficiaries
(in such capacities, the "Grantors" and the "UTI Beneficiaries", respectively),
RTRT, Inc., as trustee (the "Trustee"), Ryder Truck Rental, Inc., as
Administrative Agent (the "Administrative Agent"), Delaware Trust Capital
Management, Inc., as Delaware trustee (the "Delaware Trustee"), and U.S. Bank
National Association, as trust agent (the "Trust Agent").
This certificate is one of two duly authorized 1999-A [Lease][Vehicle]
SUBI Certificates, and is issued under and is subject to the terms, provisions
and conditions of the Origination Trust Agreement and the supplement thereto,
dated as of October 1, 1999 (the "1999-A SUBI Supplement" and, together with the
Origination Trust Agreement, the "SUBI Trust Agreement"). To the extent not
otherwise defined herein, capitalized terms used herein have the meanings
assigned thereto in the SUBI Trust Agreement. By acceptance of this 1999-A
[Lease] [Vehicle] SUBI Certificate, the Holder hereof assents to the terms and
conditions of the SUBI Trust Agreement and agrees to be bound thereby. A summary
of certain of the pertinent provisions of the SUBI Trust Agreement is set forth
below.
The assets of the Trust allocated to the 1999-A [Lease] [Vehicle] SUBI
will generally consist of (i) cash capital and [(ii) the 1999-A Leases] [(ii)
the 1999-A Vehicles] and all of Ryder's rights thereunder, including the right
to proceeds arising therefrom or in connection therewith.
B-1
<PAGE> 22
Under the Origination Trust Agreement, from time to time the UTI
Beneficiaries may direct the Trustee to issue to or upon the order of the UTI
Beneficiaries one or more certificates (each, a " SUBI Certificate")
representing a beneficial interest in certain specified Vehicles, Leases and
related Trust Assets (such assets, the " SUBI Assets"). Upon the issuance of the
SUBI Certificates relating to the SUBI Assets, the beneficial interest in the
Trust and the Trust Assets represented by the UTI shall be reduced by the amount
of the Trust Assets represented by such SUBI Certificates. This certificate,
together with a certificate evidencing a [99%] [1%] interest in all 1999-A
[Lease] [Vehicle] SUBI Assets, was issued pursuant to the 1999-A SUBI Supplement
and represents a beneficial interest in the 1999-A [Lease] [Vehicle] SUBI
Assets.
The UTI and the 1999-A [Lease] [Vehicle] SUBI shall each constitute a
separate series of the Trust pursuant to Section 3806(b)(2) of the Delaware Act
for which separate and distinct records shall be maintained. Each 1999-A [Lease]
[Vehicle] SUBI Certificate and the interest in the 1999-A [Lease] [Vehicle] SUBI
represented thereby constitutes a "security" within the meaning of Section
8-102(a)(15) of the UCC and a "certificated security" within the meaning of
Section 8-102(a)(4) of the UCC.
The 1999-A SUBI Supplement may be amended by the parties thereto upon
the terms and subject to the conditions set forth in the 1999-A SUBI Supplement.
The Holder, by acceptance of this 1999-A [Lease] [Vehicle] SUBI
Certificate, covenants and agrees that prior to the date that is one year and
one day after the date upon which all obligations under each Securitized
Financing have been paid in full, it will not institute against, or join any
other Person in instituting against any Grantor, the Trustee, the Trust, any
Beneficiary, any general partner of a Beneficiary or of a Special Purpose
Affiliate that is a partnership or any member of a Beneficiary or Special
Purpose Affiliate (or any of their respective general partners) that is a
limited liability company, any bankruptcy, reorganization, arrangement,
insolvency or liquidation Proceeding or other Proceedings under any federal or
state bankruptcy or similar law. Such covenant shall survive the termination of
the SUBI Trust Agreement, the resignation or removal of the Trustee under the
SUBI Trust Agreement or the complete or partial resignation of the
Administrative Agent.
The Holder hereof or owner of a beneficial interest herein hereby (i)
expressly waives any claim it may have to any proceeds or assets of the Trustee
and to all of the Trust Assets other than those from time to time included
within the 1999-A [Lease] [Vehicle] SUBI as 1999-A [Lease] [Vehicle] SUBI Assets
and those proceeds or assets derived from or earned by such 1999-A [Lease]
[Vehicle] SUBI Assets and (ii) expressly subordinates in favor of the Holder of
any Other SUBI Certificate or a UTI Certificate any claim to any Other SUBI or
UTI Assets that, notwithstanding the waiver contained in clause (i), may be
determined to exist.
The Trustee shall keep the certificate register with respect to this
1999-A [Lease] [Vehicle] SUBI Certificate, and the Holder of this 1999-A [Lease]
[Vehicle] SUBI Certificate shall notify the Trustee of any change of address or
instructions on the distribution of funds.
The 1999-A [Lease] [Vehicle] SUBI shall be deemed dissolved solely with
respect to the 1999-A [Lease] [Vehicle] SUBI Assets, and not as to any Trust
Assets allocated to any other
B-2
<PAGE> 23
Sub-Trust, upon the written direction to the Trustee by the Related Beneficiary
to revoke and dissolve the 1999-A [Lease] [Vehicle] SUBI. Upon such dissolution
of the Trust with respect to the 1999-A [Lease] [Vehicle] SUBI and delivery of
the 1999-A [Lease] [Vehicle] SUBI Certificates to the Trustee for cancellation,
the Trustee shall distribute to the Related Beneficiary or its designee all
1999-A [Lease] [Vehicle] SUBI Assets [and shall cause the Certificates of Title
to the 1999-A Vehicles to be issued in the name of, or at the direction of, the
Related Beneficiary (which may include reallocation of the 1999-A Vehicle SUBI
Assets to the UTI). The Related Beneficiary to whom such 1999-A Vehicle SUBI
Assets are distributed shall pay or cause to be paid all applicable titling and
registration fees and taxes.] The 1999-A [Lease] [Vehicle] SUBI shall be deemed
dissolved solely with respect to the 1999-A [Lease] [Vehicle] SUBI Assets, and
not as to any Trust Assets allocated to any other Sub-Trust upon the bankruptcy
of the Transferor subject to the conditions set forth in the SUBI Trust
Agreement.
Upon the dissolution of the Trust with respect to the 1999-A [Lease]
[Vehicle] SUBI, the 1999-A [Lease] [Vehicle] SUBI shall be terminated and the
1999-A [Lease] [Vehicle] SUBI Certificates shall be returned to the Trustee for
cancellation. Such a termination shall not effect a termination of the Trust or
of any Other SUBIs that is in existence at the time of such termination.
The Trust or the UTI may terminate upon the terms and subject to the
conditions set forth in the SUBI Trust Agreement.
No SUBI or SUBI Certificate shall be transferred or assigned except to
the extent specified in the SUBI Trust Agreement or in any related Supplement
and, to the fullest extent permitted by applicable law, any such purported
transfer or assignment other than as so specified shall be deemed null, void and
of no effect under the SUBI Trust Agreement. Notwithstanding the foregoing, any
SUBI Certificate and the interest in the SUBI evidenced thereby may be (i)
transferred, assigned or pledged to any Special Purpose Affiliate or (ii)
transferred, assigned or pledged by the Related Beneficiary or a Special Purpose
Affiliate to or in favor of (A) a trustee for one or more trusts or (B) one or
more other entities, in either case solely for the purpose of securing or
otherwise facilitating one or more Securitized Financings.
This 1999-A [Lease] [Vehicle] SUBI Certificate shall be governed by and
construed under the internal laws of the State of Delaware, without regard to
any otherwise applicable principles of conflict of laws.
Unless this 1999-A [Lease] [Vehicle] SUBI Certificate shall have been
executed by an authorized officer of the Trustee, by manual signature, this
1999-A [Lease] [Vehicle] SUBI Certificate shall not entitle the holder hereof to
any benefit under the SUBI Trust Agreement or be valid for any purpose.
B-3
<PAGE> 24
IN WITNESS WHEREOF, RTRT, Inc., as Trustee of the Trust and not in its
individual capacity, has caused this 1999-A [Lease] [Vehicle] SUBI Certificate
to be duly executed.
Dated: __________, 1999 RYDER TRUCK RENTAL LT
By: RTRT, INC.,
as Trustee
By:
-----------------------------------
Name:
Title:
(SEAL)
ATTEST:
This is one of the 1999-A [Lease] [Vehicle] SUBI Certificates referred to in the
within-mentioned Supplement.
RTRT, INC., as Trustee
By:
-----------------------------------
Authorized Officer
B-4
<PAGE> 25
FOR VALUE RECEIVED, the undersigned hereby sells, transfers and assigns
unto ______________ the within 1999-A [Lease] [Vehicle] SUBI Certificate, and
all rights thereunder, hereby irrevocably constituting and appointing
_____________ as attorney to transfer said 1999-A [Lease] [Vehicle] SUBI
Certificate on the books of the certificate registrar, with full power of
substitution in the premises.
Dated: _____________________
By:
-----------------------------------
Name:
Title:
B-5
<PAGE> 1
Exhibit 10.3
===============================================================================
RYDER TRUCK RENTAL LT,
RYDER TRUCK RENTAL I LP
and
RYDER TRUCK RENTAL II LP,
as UTI Beneficiaries,
RYDER TRUCK RENTAL, INC.,
as Administrative Agent,
and
RYDER TRUCK RENTAL, INC.,
as Maintenance Provider
------------------------------------------------------------------
ADMINISTRATION AGREEMENT
Dated as of February 1, 1998
------------------------------------------------------------------
===============================================================================
<PAGE> 2
TABLE OF CONTENTS
Page
----
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions................................................ 2
Section 1.02. Interpretive Provisions.................................... 7
ARTICLE TWO
SERVICING OF LEASES
Section 2.01. Duties of Administrative Agent............................. 8
Section 2.02. Records.................................................... 9
Section 2.03. Certificates of Title; Registration........................10
Section 2.04. Initial Funding of Payments to Manufacturers...............11
Section 2.05. Administrative Agent's Repurchase Obligations..............11
Section 2.06. Collections; Accounts......................................13
Section 2.07. Servicing Compensation.....................................16
Section 2.08. Third Party Claims.........................................16
Section 2.09. Repossession and Sale of Vehicles..........................16
Section 2.10. Administrative Agent to Act on Behalf of Trustee...........17
Section 2.11. Fidelity Bond; Insurance...................................19
Section 2.12. Administrative Agent Not to Resign; Assignment.............19
Section 2.13. Merger.....................................................20
Section 2.14. Limitation on Liability of Administrative Agent............21
Section 2.15. Administrative Agent Reimbursement.........................21
Section 2.16. Eligible Leases; Documentation.............................22
ARTICLE THREE
MAINTENANCE PROVIDER
Section 3.01. Provision of Certain Specified Services and Maintenance....23
i
<PAGE> 3
ARTICLE FOUR
STATEMENTS AND REPORTS
Section 4.01. Reporting by the Administrative Agent; Delivery of Certain
Documentation..............................................25
ARTICLE FIVE
ADMINISTRATIVE AGENT DEFAULTS
Section 5.01. Administrative Agent Defaults; Termination of
Administrative Agent.......................................26
Section 5.02. No Effect on Other Parties.................................29
ARTICLE SIX
MAINTENANCE PROVIDER DEFAULTS
Section 6.01. Maintenance Provider Defaults; Termination of
Maintenance Provider.......................................30
Section 6.02. No Effect on Other Parties.................................32
ARTICLE SEVEN
ADMINISTRATIVE AGENT REPRESENTATIONS AND WARRANTIES
Section 7.01. Representations and Warranties.............................33
ARTICLE EIGHT
MISCELLANEOUS
Section 8.01. Termination of Agreement...................................35
Section 8.02. Amendment..................................................35
Section 8.03. Governing Law..............................................36
Section 8.04. Relationship of this Agreement to Other Trust Documents....36
Section 8.05. Notices....................................................36
Section 8.06. Severability of Provisions.................................36
Section 8.07. Inspection and Audit Rights................................37
Section 8.08. Binding Effect.............................................37
ii
<PAGE> 4
Section 8.09. Table of Contents and Headings.............................37
Section 8.10. Counterparts...............................................37
Section 8.11. Further Assurances.........................................37
Section 8.12. Third Party Beneficiaries..................................37
Section 8.13. No Waiver; Cumulative Remedies.............................37
Section 8.14. No Petition................................................38
ARTICLE NINE AND TEN
[RESERVED]
Signatures ...........................................................40
EXHIBITS
Exhibit A - Power of Attorney Pursuant to Section 2.09(b)...................A-1
Exhibit B - Power of Attorney Pursuant to Section 2.10(b)...................B-1
iii
<PAGE> 5
ADMINISTRATION AGREEMENT
This Administration Agreement, dated as of February 1, 1998, is among
Ryder Truck Rental LT, a Delaware business trust (the "Trust"), Ryder Truck
Rental I LP and Ryder Truck Rental II LP, each a Delaware limited partnership,
as UTI Beneficiaries (the "UTI Beneficiaries"), Ryder Truck Rental, Inc., a
Florida corporation ("Ryder"), as administrative agent (in such capacity, the
"Administrative Agent"), and Ryder, as maintenance provider (in such capacity,
the "Maintenance Provider").
RECITALS
WHEREAS, the UTI Beneficiaries, the Administrative Agent, Delaware
Trust Capital Management, Inc., a Delaware banking corporation, as Delaware
trustee, RTRT, Inc., a Delaware corporation, as trustee (the "Trustee"), and,
for certain limited purposes set forth therein, U.S. Bank National Association,
a national banking association, as trust agent, have entered into that certain
Second Amended and Restated Trust Agreement, dated as of February 1, 1998 (the
"Origination Trust Agreement"), pursuant to which the purposes of the Trust
are, among other things, to take assignments and conveyances of, and hold in
trust and deal in, various Trust Assets (as such term is defined in the
Origination Trust Agreement);
WHEREAS, the Trust will be comprised of a UTI and one or more SUBIs
(as such terms are defined in the Origination Trust Agreement), each of which
will constitute a separate series of the Trust under Delaware law, and each of
which will have allocated to it certain specified Trust Assets;
WHEREAS, the parties desire to enter into this Agreement to provide
for, among other things, the servicing of the Trust Assets by the
Administrative Agent; and
WHEREAS, the parties acknowledge that, in connection with, among other
things, the creation of SUBIs, it may be necessary or desirable to enter into
supplemental agreements hereto, providing for specific servicing obligations in
connection therewith.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
<PAGE> 6
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions. Capitalized terms used herein that are not
otherwise defined shall have the meanings ascribed thereto in the Origination
Trust Agreement. Whenever used in this Agreement, unless the context otherwise
requires, the following words and phrases shall have the following meanings:
"Accountant" means a Person qualified to pass upon accounting
questions, whether or not such Person shall be an officer or employee of Ryder,
the Administrative Agent or any of their respective Affiliates (unless
otherwise required to be Independent and such status would invalidate
qualification as Independent).
"Administration Fee" means the fee payable on each Payment Date equal
to, for each Monthly Period, with respect to (i) the UTI, one-twelfth of the
product of 1% and the Net Book Value of the related Vehicles as of the first
day of such Monthly Period and (ii) a SUBI, the amount described in the related
SUBI Administration Supplement.
"Administration Supplement" means either a UTI Administration
Supplement or a SUBI Administration Supplement, as the context may require.
"Administrative Agent" means Ryder, in its capacity as administrative
agent under this Agreement, and each Person succeeding to the duties of the
Administrative Agent hereunder pursuant to Section 2.13(b) or 5.01(c).
"Administrative Agent Default" has the meaning set forth in Section
5.01(a).
"Administrative Agent Representation Date" means, with respect to (i)
the UTI, the date of this Agreement and (ii) any SUBI, the date of the related
SUBI Administration Supplement.
"Administrative Modification" means, with respect to any Lease, the
operational or administrative change made by the Administrative Agent of the
Maturity Date of such Lease of up to 45 days.
"Advance" means any advance the Administrative Agent may be required
to make pursuant to the applicable Administration Supplement.
"Agreement" means this Administration Agreement, as amended or
supplemented from time to time by a particular Administration Supplement or all
Administration Supplements, as the context may require.
"Annual Termination Option" means, with respect to any Lease, the
annual option, exercisable by either the related Lessee or the Administrative
Agent, to terminate such Lease as of the annual anniversary of the date the
related Vehicle was delivered to such Lessee (or, with respect to certain
Leases, more frequently).
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"Assignment Date" means, with respect to any Lease or Vehicle, the
date such Lease or Vehicle is transferred to the Trust.
"Board of Directors" means, with respect to any Person (which, in the
case of a partnership, shall be its managing general partner or, if there is no
managing general partner, any general partner thereof), either its Board of
Directors or any duly authorized committee thereof.
"Board Resolution" means, with respect to any Person (which, in the
case of a partnership, shall be its managing general partner or, if there is no
managing general partner, any general partner thereof), a copy of a resolution
certified by its Secretary or an Assistant Secretary to have been duly adopted
by the Board of Directors of such Person and to be in full force and effect on
the date of such certification and delivered to the entity to which such
resolution is required to be delivered.
"Casualty Proceeds" means the amount remitted by the Administrative
Agent, within two Business Days after processing, to the related Collection
Account, if a Lessee is responsible for paying for loss or damage to a Vehicle
relating to a Casualty Termination Lease, equal to the sum of (i) all Insurance
Proceeds received in respect of loss or damage to such Vehicle and (ii) any
proceeds received from the sale of such Vehicle at salvage, in each case net of
any applicable Disposition Expenses.
"Casualty Termination Lease" means a Lease that terminated because the
related Vehicle had been lost, stolen or damaged beyond economic repair.
"Charged-Off Lease" means a Lease (i) with respect to which the
related Vehicle has been repossessed and sold or otherwise disposed of or (ii)
that has been written off by the Administrative Agent in accordance with its
usual standards for writing off lease contracts for leased vehicles other than
with respect to repossessions.
"Collection Period" means (i) with respect to the UTI, a period
comprised of three Monthly Periods, beginning with the month in which the
Effective Date occurs, and (ii) with respect to a SUBI, "Collection Period" as
defined in the related SUBI Administration Supplement.
"Default Termination Lease" means a Lease terminated (and, if
allocated to any SUBI, reallocated to the UTI) (i) by the Administrative Agent
following a default by or bankruptcy of the related Lessee, (ii) by such Lessee
(other than by exercising the Annual Termination Option) based on an alleged
breach by the Maintenance Provider under such Lease or (iii) and written off by
the Administrative Agent in accordance with its usual standards for writing off
lease contracts for leased vehicles.
"Defaulted Vehicle" means a Vehicle relating to a Default Termination
Lease.
"Determination Date" means the tenth calendar day of each month in
which a Payment Date occurs or, if such day is not a Business Day, the
immediately succeeding Business Day.
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"Disposition Expenses" means expenses and other amounts reasonably
incurred by the Administrative Agent in connection with the sale or other
disposition of an Expired Vehicle or a Defaulted Vehicle, including discounts,
Vehicle presale conditioning and refurbishment costs, finance incentives,
freight, taxes, fuel, storage, sales commissions and expenses incurred in
connection with making claims under any Insurance Policy.
"Distribution Account" means such account as may be established
pursuant to a Supplement, an Administration Supplement or related Securitized
Financing Documents into which distributions to holders of Securities are
required to be deposited.
"Excess Casualty Proceeds" means all Casualty Proceeds received in
excess of the Securitization Value of the related Lease as of the effective
date of casualty.
"Excess Termination Proceeds" means all Termination Proceeds received
in excess of the Securitization Value of the related Lease as of the effective
date of termination.
"Expired Lease" means a Lease relating to a Vehicle that has reached
its Maturity Date or as to which the Annual Termination Option was exercised
and no Termination Value Payment was made.
"Expired Vehicle" means a Vehicle relating to an Expired Lease.
"Extension" means, with respect to any Lease, the extension of the
Maturity Date of such Lease.
"Fees and Taxes" has the meaning set forth in Section 2.10(b).
"Filings" has the meaning set forth in Section 2.10(b).
"Force Majeure Event" means an act beyond the reasonable control of
the Administrative Agent or the Maintenance Provider, as applicable, including
acts of God, war, vandalism or sabotage, rioting, accidents, fires, floods,
earthquakes, hurricanes, strikes, labor disputes, mechanical breakdowns,
shortages or delays in obtaining suitable parts, equipment, material, labor or
transportation, acts of subcontractors, interruption of utility services, acts
of any unit of government or any governmental agency or any event similar to
the foregoing.
"Independent" when used with respect to any Accountant means such an
Accountant, who may also be the Accountant who audits a Beneficiary, Ryder, the
Administrative Agent or any of their respective Affiliates, who is Independent
with respect to such entity as contemplated by Rule 101 of the Code of
Professional Conduct of the American Institute of Certified Public Accountants.
Whenever it is herein provided that any Independent Person's opinion or
certificate shall be furnished to the Trustee, such Person shall be acceptable
to the Trustee if such opinion or certificate shall state that the signer has
read this definition and that the signer is Independent within the meaning
hereof.
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"Lease Documents" means, with respect to any Lease, the Lease, the
Certificate of Title, any Insurance Policies or insurance records and any other
documents relating to such Lease and the related Vehicle.
"Maintenance Component" means the portion of each Total Monthly
Payment that represents payment for services and maintenance in respect of the
related Vehicle.
"Maintenance Provider" means Ryder, in its capacity as provider of
specified services, maintenance and supplies in respect of the Vehicles, and
any successor thereto as specified in a related Administration Supplement.
"Maintenance Provider Default" has the meaning set forth in Section
6.01.
"Maturity Date" means, with respect to any Lease, the date specified
in such Lease as the scheduled maturity date of such Lease, or any other date
of termination, including a date of termination pursuant to an Administrative
Modification.
"Monthly Period" means, with respect to any Collection Period, each
calendar month during such Collection Period.
"Operating Expenses" means, for any period, the sum of all
Reimbursable Expenses and Trust Expenses incurred during or with respect to
such period.
"Origination Trust Agreement" has the meaning set forth in the
Recitals.
"Other Collections" means, with respect to any Collection Period, all
funds collected or received by the Administrative Agent during such Collection
Period relating to assets that are not Trust Assets, including receivables
relating to (i) the lease, maintenance, repair, fueling, sale, exchange,
disposition or rental of vehicles (other than Vehicles) or (ii) any agreement
relating to such assets, including vehicle lease agreements, short-term and
long-term vehicle rental, maintenance or repair agreements (including long-term
maintenance contracts and agreements for isolated repairs on a retail or "sales
and service" basis), work-out agreements, guarantee agreements, letters of
credit, security deposit agreements and vehicle sale or remarketing agreements.
"Other Proceeds" means monies arising from the sale, exchange, lease,
rental, collection or other disposition or maintenance, repair or servicing of
lease contracts, vehicles or other receivables (other than the Leases and the
Vehicles) that the Administrative Agent is servicing.
"Payment Date" means, except as otherwise set forth in an
Administration Supplement, March 15, June 15, September 15 and December 15 of
each year or, if such day is not a Business Day, the immediately succeeding
Business Day, commencing with the first Payment Date specified in the related
Administration Supplement.
"Payment Information" has the meaning set forth in Section 2.06(f)(i).
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"Prepayment" means payment to the Administrative Agent of 100% of the
remaining Total Monthly Payments due on a Lease or such lesser amount as may be
provided for in such Lease, including any related payment of interest, and may
be in the form of Proceeds resulting from a voluntary early termination of such
Lease, exercise of the Annual Termination Option and receipt of the related
Termination Value Payment or Termination Proceeds following a default by or
bankruptcy of the related Lessee or Reallocation Payments made by the
Administrative Agent.
"Proceeds" means Sales Proceeds, Termination Proceeds, Casualty
Proceeds or Insurance Proceeds, as the context may require.
"Reallocation Payment" means, with respect to any Lease, an amount
equal to the Securitization Value of such Lease as of the day on which the
related cure period (as determined in Section 2.05(b)) ended.
"Reimbursable Expense" means an amount paid, incurred or advanced by
the Administrative Agent to pay fees, costs or other sums for which the
Administrative Agent may be reimbursed from Trust Assets.
"Rental Agreement" means any agreement for the rental of a Rental
Vehicle.
"Rental Documents" means, with respect to any Rental Vehicle, the
certificate of title, any insurance policies or insurance records and any other
documents relating to such Rental Vehicle.
"Required Related Holders" means, with respect to (i) the UTI, the UTI
Beneficiaries and (ii) any SUBI, the Holders of SUBI Certificates representing
51% of the related ownership interest in the SUBI (excluding any SUBI
Certificates held by the UTI Beneficiaries, the Related Beneficiary, the
Administrative Agent or any Affiliate thereof).
"Required UTI Collection Account Balance" means, with respect to the
UTI Collection Account as of the last day of a Collection Period, an amount
equal to all accrued but unpaid Operating Expenses as of such date.
"Sales Proceeds" means (i) with respect to the UTI, with respect to
any Expired Vehicle or Defaulted Vehicle, all proceeds received from the sale
or other disposition of such Expired or Defaulted Vehicle (including any
applicable Insurance Proceeds), less all applicable Disposition Expenses and
(ii) with respect to a SUBI, "Sales Proceeds" as defined in the related SUBI
Administration Supplement.
"Securitization Value" means, with respect to (i) UTI Leases, the Net
Book Value of the related UTI Vehicles and (ii) SUBI Leases, "Securitization
Value" as defined in the related SUBI Administration Supplement.
"Securityholder" means the holder of a Security.
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"Special Event Purchase" has the meaning set forth in Section 2.05(g).
"SUBI Collections" shall have the meaning set forth in the related
Administration Supplement.
"Termination Proceeds" means, with respect to a Default Termination
Lease, an amount equal to the sum of (i) any payment received from the related
Lessee in respect of the Termination Value of the related Vehicle and (ii) the
Sales Proceeds relating thereto.
"Termination Value" means, with respect to any Vehicle, the amount
equal to the amount specified in the related Schedule A as the termination
value of such Vehicle.
"Termination Value Payment" means the payment to be remitted to the
Administrative Agent by a Lessee, if such Lessee elects or is required to
purchase a Vehicle in connection with the exercise of the Annual Termination
Option, in an amount equal to such Vehicle's Termination Value.
"Trust" means Ryder Truck Rental LT, a Delaware business trust, and
its successors.
"Trust Agent" has the meaning set forth in the Recitals.
"Trustee" has the meaning set forth in the Recitals.
"UTI Collection Account Balance" means, as of any date, the balance on
deposit in the UTI Collection Account as of the close of business of the
immediately preceding Business Day.
"UTI Collections" means, with respect to any Collection Period, all
funds collected or received by the Administrative Agent in respect of the UTI
Assets during such Collection Period.
"Vehicle Representation Date" means, with respect to the
Administrative Agent's representations and warranties in Section 2.05(a), (i)
with respect to the UTI, the Assignment Date of each related Lease and (ii)
with respect to a SUBI, the "Vehicle Representation Date" as defined in the
related SUBI Administration Supplement.
Section 1.02. Interpretive Provisions. For all purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires, (i) terms used herein include, as appropriate, all genders
and the plural as well as the singular, (ii) references to this Agreement
include all Exhibits hereto, (iii) references to words such as "herein",
"hereof" and the like shall refer to this Agreement as a whole and not to any
particular part, Article or Section within this Agreement, (iv) references to
an Article or Section such as "Article One" or "Section 1.01" shall refer to
the applicable Article or Section of this Agreement, (v) the term "include" and
all variations thereof shall mean "include without limitation", (vi) the term
"or" shall include "and/or" and (vii) the term "proceeds" shall have the
meaning ascribed to such term in the UCC.
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ARTICLE TWO
SERVICING OF LEASES
Section 2.01. Duties of Administrative Agent.
(a) The Administrative Agent shall service, administer and collect
under the Leases and in respect of the Vehicles in accordance with this
Agreement and shall have full power and authority, acting alone and subject
only to the specific requirements and prohibitions of this Agreement, to do any
and all things in connection with such servicing, administration and collection
that it may reasonably deem necessary or desirable, in the interests of the
Trust. The duties of the Administrative Agent shall include, among other
things, in accordance with this Agreement, the Origination Trust Agreement and
any applicable Supplement or Administration Supplement:
(i) performing on behalf of the Trust all obligations on the part
of the Lessor under the Leases;
(ii) collecting and processing payments, responding to inquiries
of Lessees, investigating delinquencies, sending payment statements
and reporting tax information to Lessees, paying costs of the sale or
other disposition of Vehicles relating to Charged-Off Leases and
paying all state and local personal property, use, excise and sales
taxes on the Vehicles as and when such taxes become due;
(iii) executing and delivering, in its own name or on behalf of
the Trust, or on behalf of itself and the Trust, as the case may be,
any and all instruments, certificates or other documents necessary or
advisable in connection with the servicing or administering of or
collecting under the Leases and in respect of the Vehicles, including:
(A) any and all bills of sale; (B) any documents relating to recording
and maintaining title to the Vehicles in the name of the Trust or the
Trustee on behalf of the Trust; (C) transfers of Certificates of
Title; (D) consents; (E) amendments, Extensions or modifications to
any of the Leases; and (F) all other instruments similar to the
foregoing;
(iv) servicing of the Leases, including: (A) accounting for
collections and furnishing statements to the Trustee with respect to
distributions, as specified in a related Supplement or Administration
Supplement; (B) making Advances; (C) generating federal and state tax
information and returns on behalf of the Trust; (D) administering
audits for sales; (E) filing periodic sales and use tax or property
(real or personal) tax reports; and (F) creating, maintaining and
amending the Schedule of Vehicles;
(v) in connection with the creation of each Sub-Trust, delivering
to the Trustee a Schedule of Vehicles that is current as of a date not
more than ten days prior to the date of such delivery; and
(vi) applying for and maintaining the licenses, permits and
authorizations and making the filings described in Section 5.01(c) of
the Origination Trust Agreement. The servicing provisions contained in
this Agreement shall replace the servicing provisions contained in the
Origination Trust Agreement in their entirety.
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(b) The Administrative Agent agrees that the servicing of and
collecting under the Leases and the Vehicles shall be carried out using that
degree of skill, care and attention in accordance with customary and usual
procedures employed by the Administrative Agent in respect of truck, tractor
and trailer leases serviced by the Administrative Agent for its own account.
The Administrative Agent may retain agents to assist it in performing its
servicing functions; provided, that any delegation of duties to any agent shall
not relieve the Administrative Agent of any of its obligations hereunder. The
Administrative Agent is authorized to, in its own name, in the name of the
Trust or in the name of the Trustee on behalf of the Trust, commence, defend
against or otherwise participate in a Proceeding relating to or involving the
protection or enforcement of the interests of the Trust, the Trustee on behalf
of the Trust, a Holder or a Beneficiary in any Lease, Vehicle or other Trust
Asset. If the Administrative Agent shall commence, defend against or otherwise
participate in a Proceeding in its own name, then the Trust, the Trustee on
behalf of the Trust, such Holder or such Beneficiary shall thereupon be deemed
to have automatically assigned its interest in (including legal title to) the
related Lease, Vehicle or other Trust Asset, as applicable, to the
Administrative Agent to the extent necessary for the purposes of such
Proceeding. If in any Proceeding it is held that the Administrative Agent may
not enforce the rights of the Trust, the Trustee on behalf of the Trust, a
Holder or a Beneficiary in a Lease, Vehicle or other Trust Asset on the grounds
that it is not the real party in interest or a holder entitled to enforce such
Lease or other relevant document or instrument, the Trustee shall, at the
direction of the Administrative Agent, take such steps as to enforce the
interest of the Trust, the Trustee on behalf of the Trust, a Holder or a
Beneficiary in such Lease, Vehicle or other Trust Asset, including bringing
suit in its own name or in the name of the Related Beneficiary or related
Holder. The Administrative Agent shall pay, either directly or by making a
deposit into the related Collection Account for use by the Trustee, the costs
and expenses associated with any Proceeding pursuant to this Section. Such
costs and expenses shall be Reimbursable Expenses. The Trustee shall furnish
the Administrative Agent with any powers of attorney or other documents
necessary or appropriate to enable the Administrative Agent to carry out its
servicing, administration and collection duties hereunder.
(c) The Administrative Agent may exercise the Annual Termination
Option (i) with respect to UTI Vehicles, for the benefit of the UTI
Beneficiaries or (ii) with respect to SUBI Vehicles, for the benefit of the
Related Beneficiary.
Section 2.02. Records.
(a) The Administrative Agent shall maintain or cause to be maintained
such computer and manual records with respect to all funds and other receipts
with respect to the Trust Assets as are consistent with the customary servicing
procedures of the Administrative Agent.
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(b) The Administrative Agent, in its capacity as agent, custodian and
bailee, shall hold the Lease Documents and the Rental Documents or cause the
Lease Documents and the Rental Documents to be held on behalf of the Trust for
the use and benefit of the Trust and all present and future Holders and
Beneficiaries and maintain accurate and complete accounts, records and computer
systems pertaining to the Lease Documents and the Rental Documents and relating
directly to or maintained in connection with the servicing of the Leases, which
accounts, records and computer systems shall also identify the Sub-Trust to
which each Lease, Vehicle or other Trust Asset is allocated and reflect the
interest of the Related Beneficiary therein. The Lease Documents, Rental
Documents and related accounts, records and computer systems need not be
physically segregated from other documents relating to leases and vehicles of
the Administrative Agent. The Administrative Agent shall promptly report to the
Trustee any material failure on its part to hold the Lease Documents and the
Rental Documents and maintain its accounts, records and computer systems as
herein provided, and shall promptly take appropriate action to remedy any such
failure.
(c) To ensure uniform quality in the servicing of the Leases and the
Vehicles and to reduce administrative costs, the Trustee hereby revocably
appoints the Administrative Agent, and the Administrative Agent hereby accepts
such appointment, to act as the agent of the Trust as agent, custodian and
bailee of the Lease Documents and the Rental Documents, which are hereby
constructively delivered to the Trust with respect to each Lease and Vehicle.
The Administrative Agent shall maintain or cause to be maintained each Lease
Document and Rental Document at the Administrative Agent's location at which
the related Vehicle is domiciled or at such other location as shall be
specified to the Trustee by the Administrative Agent. The Administrative Agent
shall make available to the Trustee or its duly authorized representatives,
attorneys or auditors the Lease Documents, the Rental Documents and the related
accounts, records and computer systems maintained by the Administrative Agent
or any agent thereof at such times as the Trustee shall reasonably instruct and
at such location as the same are maintained. The Administrative Agent shall
promptly report to the Trustee any material failure on its part to retain
possession of the Lease Documents and the Rental Documents and shall promptly
take appropriate action to remedy any such failure.
(d) In the exercise of its duties and powers hereunder, the
Administrative Agent may release any Lease Document or Rental Document or other
related item to the Trustee on behalf of the Trust or its agent or designee, as
the case may be, at such place or places as the Trustee may designate. The
Administrative Agent shall not be responsible for any Loss occasioned by the
failure of the Trustee to return any document or for any delay in doing so.
Section 2.03. Certificates of Title; Registration.
(a) In connection with the filing of the application for each
Certificate of Title, the Administrative Agent shall arrange for the related
Registrar of Titles to issue and deliver to or upon the order of the
Administrative Agent a Certificate of Title identifying the Trust or the
Trustee on behalf of the Trust as the owner of the related Vehicle. Each
Certificate of Title shall be held by the Administrative Agent as agent on
behalf of the Trust and as agent, custodian and bailee of the Lease Documents
and the Rental Documents pursuant to Section 2.02. The Administrative Agent
shall direct Ryder or any other entity assigning or causing to be assigned
Leases or Vehicles to the Trust or the Trustee on behalf of the Trust, to show
on each related Certificate of Title the owner of such Vehicle as "Ryder Truck
Rental LT", "RTRT, Inc., as Trustee" or such other designation as may be agreed
upon by the Administrative Agent and the UTI Beneficiaries from time to time
and that is acceptable to the related Registrars of Titles.
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(b) Except as otherwise required by applicable law, the related
Registrar of Titles or the Administrative Agent's customary servicing
procedures, the Administrative Agent shall direct Ryder to include the address
of the Administrative Agent as the address of the owner of each Vehicle. Except
as otherwise required by applicable law or the related Registrar of Titles, so
long as a Vehicle is owned by the Trust, the Administrative Agent shall not
permit the related Certificate of Title to identify any entity other than the
Trust or the Trustee on behalf of the Trust as the owner of such Vehicle, but
the Administrative Agent or any related Lessee may be the registrant with
respect to such Vehicle.
Section 2.04. Initial Funding of Payments to Manufacturers. The
Administrative Agent shall fund or cause to be funded payments on behalf of the
Trust to or upon the order of Ryder for each Lease and Vehicle acquired by the
Trust from Ryder or from a manufacturer at Ryder's request.
Section 2.05. Administrative Agent's Repurchase Obligations.
(a) The Administrative Agent hereby makes to the other parties hereto
and the parties to the Origination Trust Agreement the following
representations and warranties as to each Lease and Vehicle. The Trust shall
rely on such representations and warranties in accepting the Leases and the
Vehicles. Such representations and warranties shall speak as of the related
Vehicle Representation Date, and shall survive the transfer of the Leases and
the Vehicles and the delivery of the related Lease Documents or Rental
Documents to the Trust pursuant to the Origination Trust Agreement and this
Agreement:
(i) each Lease is an Eligible Lease; and
(ii) the Administrative Agent has satisfied or has caused Ryder
to satisfy the provisions of Section 2.03 with respect to Certificates
of Title for each Vehicle.
(b) Upon discovery by the Trustee, the Administrative Agent, the
Related Beneficiary or a related Holder that any such representation or
warranty was incorrect as of the related Vehicle Representation Date and
materially and adversely affects the interests of the Trust in the related
Lease or Vehicle, the party discovering such incorrectness (if other than the
Administrative Agent) shall give prompt written notice to the Administrative
Agent. Within 60 days after the Administrative Agent's discovery of such
incorrectness or receipt of the foregoing notice, the Administrative Agent
shall cure in all material respects the circumstance or condition as to which
the representation or warranty was incorrect as of the related Vehicle
Representation Date. If the Administrative Agent is unable or unwilling to do
so within such period, it shall promptly (i) deposit or cause to be deposited
into the related Collection Account an amount equal to the Reallocation Payment
and (ii) direct the Trustee to cause such Vehicle or Lease and related Vehicle
to be conveyed to the Administrative Agent as described below. Such deposit of
the Reallocation Payment shall satisfy the Administrative Agent's obligations
pursuant to this Section, shall be deemed to constitute payment in full of the
Reallocation Payment with respect thereto and shall cure any incorrectness of
the related representation or warranty for purposes of this Agreement.
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Upon the purchase by the Administrative Agent of a Lease or Vehicle
pursuant to this Section, the Trust or the Trustee on behalf of the Trust, as
applicable, shall be deemed to transfer, assign, set over and otherwise convey
to the Administrative Agent, without recourse, representation or warranty, all
right, title and interest of the Trust in, to and under such Lease or Vehicle,
all monies due or to become due with respect thereto after the date of such
repurchase and all proceeds thereof. The Trustee shall, at the expense of the
Administrative Agent, execute such documents and instruments of transfer or
assignment and take such other actions as shall reasonably be requested by the
Administrative Agent to effect the conveyance of each such Lease or Vehicle
pursuant to this Section, including the execution and filing with the related
Registrar of Titles of an application for transfer of ownership of each such
Vehicle to the Administrative Agent.
(c) Except as specifically set forth herein or in any other Trust
Document, the sole remedy of the Trust, the Related Beneficiary and the related
Holder with respect to a failure of a Lease to constitute an Eligible Lease or
the failure of the related Vehicle to be titled properly shall be to require
the Administrative Agent to make a Reallocation Payment with respect thereto as
provided in this Section. The obligations of the Administrative Agent under
this Section shall survive any partial or complete termination of the
Administrative Agent hereunder.
(d) The Administrative Agent shall be required to purchase a Vehicle
prior to the Maturity Date of the related Lease and remit to the related
Collection Account an amount equal to the Securitization Value of such Lease as
of the effective date of termination if the related Lessee changes the domicile
of or title to such Vehicle and such change would result in (i) the Trust doing
business in a jurisdiction in which it is not then qualified and licensed or
(ii) significant transfer expenses not paid by such Lessee, including the
imposition of any transfer tax.
(e) The Administrative Agent may grant Extensions (i) of UTI Leases
and (ii) with respect to SUBI Leases, as set forth in the related SUBI
Administration Supplement.
(f) Notwithstanding the foregoing, the Administrative Agent may
purchase an Expired Vehicle at any time. If such Vehicle is (i) a UTI Vehicle,
the purchase price shall equal the Securitization Value of the related Lease as
of the date of expiration or (ii) a SUBI Vehicle, the purchase price shall be
determined as set forth in the related SUBI Administration Supplement.
(g) Notwithstanding the foregoing, the Administrative Agent may, but
shall not be required to, terminate, and upon such termination, purchase a
Vehicle prior to the Maturity Date of the related Lease and remit to the
related Collection Account an amount equal to the Securitization Value of such
Lease as of the effective date of termination if the Administrative Agent (i)
exercises the Annual Termination Option, including if the related Lessee
rejects an increase in the Maintenance Component when the current Maintenance
Component provides the Maintenance Provider with below average service margins
or (ii) elects to purchase such Vehicle for any administrative or commercial
reason (each, a "Special Event Purchase").
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Section 2.06. Collections; Accounts.
(a) The Administrative Agent shall use commercially reasonable efforts
to (i) collect all payments required under each Lease and (ii) cause each
Lessee to make all payments in respect of the related Lease, accompanied by an
invoice bearing the identification number of the Vehicle to which such payment
relates.
(b) Consistent with the foregoing, the Administrative Agent may in its
discretion waive any late payment charge, in whole or in part, in connection
with delinquent payments on a Lease.
(c) As and when required by a related Supplement or Administration
Supplement, the Administrative Agent shall transfer between the related
Collection Accounts (or a SUBI Lease Account, as applicable) such funds as are
required to be so transferred in connection with any Trust Asset Transfer.
(d) Transfers by the Administrative Agent to an entity at which any
Trust Account is maintained may include (i) funds being deposited into more
than one Trust Account, (ii) proceeds of Trust Assets and Other Proceeds, in
each case in a single wire transfer, provided that such transfer is accompanied
by instructions as to the appropriate division of all such proceeds and (iii)
Other Collections.
(e) As to any SUBI Collections or UTI Collections (but excluding Other
Collections) received by the Administrative Agent with respect to any Trust
Asset:
(i) except as provided below, with respect to any such UTI
Collections or SUBI Collections, upon processing thereof, the
Administrative Agent shall deposit such funds into the related
Collection Account;
(ii) with respect to Other Collections, the Administrative Agent
may deposit such funds in accordance with its normal business
practices; and
(iii) with respect to any Capital Contribution, except as
otherwise directed by the maker of such Capital Contribution, upon
processing thereof, the Administrative Agent shall deposit such funds
into the related Collection Account.
(f) Notwithstanding the foregoing, with respect to any Total Monthly
Payments, Sales Proceeds, Termination Proceeds, Casualty Proceeds, Insurance
Proceeds, Prepayments or any other payments made by or on behalf of any Lessee
or otherwise with respect to any Lease or Vehicle:
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(i) upon processing of such funds, the Administrative Agent shall
ascertain within two Business Days thereafter the following
information: (A) the amount of each receipt, (B) the identification
number of the Vehicle to which such receipt relates, (C) the nature of
the payment (i.e., whether a Total Monthly Payment, Insurance
Proceeds, Sales Proceeds, Termination Proceeds, Excess Termination
Proceeds, Casualty Proceeds, Excess Casualty Proceeds, a Prepayment or
any other payment by or on behalf of the related Lessee), (D) the date
of receipt of such payment and (E) the Sub-Trust to which such Lease
has been allocated (collectively, the "Payment Information");
(ii) as to any such funds received by the Administrative Agent
accompanied by all Payment Information, the Administrative Agent
shall, within two Business Days after processing thereof, (A) enter
the Payment Information in its computer system, (B) segregate by
making notations in its records all such funds by the Sub-Trust to
which such funds relate and (C) except as otherwise provided in a
related Administration Supplement, deposit all such funds (and, in the
case of a SUBI, net of any reimbursement provided to the
Administrative Agent pursuant to a related SUBI Administration
Supplement) into the related Collection Account;
(iii) as to any such funds received by the Administrative Agent
that are not accompanied by all Payment Information, the
Administrative Agent shall enter into its computer system all
available Payment Information, use its commercially reasonable efforts
to obtain all missing Payment Information as soon as practicable and,
upon receipt of the remaining Payment Information, the Administrative
Agent shall, within two Business Days after processing thereof, enter
such remaining Payment Information into its computer system and apply
the related funds as described in clause (ii) above.
(g) The Administrative Agent shall, from time to time, determine the
respective amounts and recipients and:
(i) as and when required by and as provided in this Agreement or
a related Administration Supplement, transfer from the related
Collection Account any due and unpaid Administration Fees;
(ii) as and when required by the Origination Trust Agreement,
this Agreement or a related Supplement or Administration Supplement,
transfer from the UTI Collection Account any Trust Expenses,
Reimbursable Expenses or Liabilities for which reimbursement is
authorized hereunder or thereunder to the Person entitled thereto;
(iii) as and when required by a related Supplement or
Administration Supplement, transfer from the related SUBI Collection
Account to the UTI Collection Account funding for each SUBI's share of
any allocable Trust Expenses, Reimbursable Expenses or Losses for
which reimbursement is authorized by the Origination Trust Agreement
or such Supplement or Administration Supplement to the extent not
otherwise provided for in this Section;
(iv) as and when required by the related Securitized Financing
Documents, transfer from the related Collection Account to the related
Distribution Account such amounts as are required to be distributed
from time to time in connection with each Securitized Financing;
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(v) as and when required by the Origination Trust Agreement or a
related Supplement or Administration Supplement, transfer between the
related Collection Accounts (or a SUBI Lease Account, as applicable)
any other funds as provided for in the Origination Trust Agreement or
any such Supplement or Administration Supplement; and
(vi) with respect to any Lease that has reached its Maturity Date
or as to which the Annual Termination Option was exercised, within two
Business Days after processing thereof, deposit into the related
Collection Account an amount equal to the lesser of (A) any Sales
Proceeds and (B) the Securitization Value of such Lease as of its
Maturity Date or date of exercise of the Annual Termination Option, as
the case may be.
Notwithstanding anything to the contrary contained herein, upon
receipt of instructions in accordance with this Agreement, the other Trust
Documents or any related Securitized Financing Documents (whether in the form
of an Officer's Certificate or otherwise), so long as Ryder Truck Rental I LP
and Ryder Truck Rental II LP are UTI Holders hereunder and Ryder is, in each
case, the limited partner thereof, any monies to be paid hereunder, other than
SUBI Collections, may be paid to or upon the order of Ryder, without the
deposit of such monies into the UTI Collection Account.
(h) The Administrative Agent shall from time to time, in accordance
with the Origination Trust Agreement or an applicable Supplement or
Administration Supplement, (i) identify and allocate on the books and records
of the Trust certain Leases and Vehicles into one or more SUBIs, either upon
the initial creation of such SUBI or periodically following its creation, and
(ii) direct the Trustee to transfer periodically from and to the related Trust
Accounts (A) such funds as are provided for in such Supplement or
Administration Supplement in connection with any Trust Asset Transfer and (B)
such SUBI's appropriate share of the Liabilities of the Trust, as determined in
accordance with the Origination Trust Agreement and such Supplement or
Administration Supplement.
(i) The Administrative Agent shall account to the Trust for the Trust
Assets related to each Sub-Trust separately in accordance with this Agreement,
the Origination Trust Agreement and the related Administration Supplement or
Supplement. The Administrative Agent shall arrange for payments by the Trustee
from each Collection Account to or at the direction of the related Holder, in
each case in accordance with the related Trust Documents or Securitized
Financing Documents.
(j) Total Monthly Payments made by mail by Lessees shall be deposited
into a lock box maintained by a bank and controlled by the Administrative
Agent, and the applicable portion thereof shall then be deposited into the
related Collection Account within two Business Days after processing.
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(k) Except as otherwise provided in an applicable Administration
Supplement, all payments made in respect of the Maintenance Component of Total
Monthly Payments received by the Administrative Agent shall be paid to or
retained by the Maintenance Provider within a reasonable time after the
Administrative Agent's receipt thereof. If the Administrative Agent fails to
comply with the preceding sentence, the Maintenance Provider shall have the
right to resign as Maintenance Provider, and the parties hereto shall comply
with the applicable provisions of Section 6.01 as if a termination of the
Maintenance Provider had occurred. The Maintenance Provider shall, and hereby
agrees to, comply in all material respects with (i) all applicable provisions
of this Agreement and (ii) all requirements relating to the provision of
services and maintenance contained in any Lease.
Section 2.07. Servicing Compensation. As compensation for the
performance of its obligations under this Agreement, and subject to any
applicable Administration Supplement, the Administrative Agent shall be
entitled to receive (i) with respect to the UTI, the Administration Fee and
(ii) with respect to a SUBI, such Administration Fee and such additional
compensation as may be provided for in the related SUBI Administration
Supplement. If at any time the Administrative Agent shall service only the
Trust Assets allocated to a particular Sub-Trust, any servicing compensation
shall be calculated based only on such Trust Assets and shall be deemed to be
an expense incurred only with respect to such Sub-Trust. The Administration Fee
shall be deemed to be an expense incurred with respect to and allocated to the
Related Trust Assets, rather than all Trust Assets generally, and shall be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
Section 2.08. Third Party Claims. The Administrative Agent shall
immediately notify the Trustee upon learning of a Claim or Lien of whatever
kind of a third party that would materially and adversely affect the interests
of the Trust or any Trust Assets allocated to a particular Sub-Trust (with
respect to any Lease or Vehicle relating thereto). When the Administrative
Agent becomes aware of any such Claim or Lien with respect to a Lease or
Vehicle, it shall take whatever action it deems reasonably necessary to cause
such Claim or Lien to be removed.
Section 2.09. Repossession and Sale of Vehicles.
(a) Subject to Section 2.09(b), the Administrative Agent shall use
commercially reasonable efforts to sell, re-deploy or otherwise dispose of any
Expired Vehicle or Vehicle as to which a Prepayment has been made by the
related Lessee without having made a Termination Value Payment, and to
repossess and sell or otherwise dispose of any Defaulted Vehicle. In
repossessing, selling or disposing of a Vehicle, the Administrative Agent shall
follow such practices and procedures as it shall deem necessary or advisable in
the servicing of full-service operating truck, tractor and trailer leases,
which may include (i) allowing a Lessee a period of time in addition to that
provided by the related Lease within which to cure a default under such Lease;
(ii) consigning a Vehicle to Ryder for resale, rental or re-lease (depending on
which of the foregoing, in the reasonable judgment of the Administrative Agent,
is likely to produce optimal cash flow); (iii) selling or re-deploying a
Vehicle at public or private sale in a commercially reasonable manner, in each
case in compliance with the related Lease and all applicable laws; or (iv)
commence and prosecute any Proceedings in respect of a Lease and the related
Vehicle.
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(b) The obligations of the Administrative Agent under this Section are
subject to the proviso that, in the event of damage to a Vehicle from a cause
for which the Lessee under the related Lease was not required to obtain
casualty or other insurance or maintain such insurance in full force and
effect, the Administrative Agent shall not be required to expend funds in
repairing such Vehicle unless it shall reasonably determine that such
restoration will increase the related Proceeds by an amount at least equal to
the cost of such repairs. The Administrative Agent shall expend funds in
connection with the repossession or sale, re-lease or rental of any Vehicle
(and all such expenses shall constitute Disposition Expenses) only to the
extent it reasonably determines that such Disposition Expenses will not exceed
the anticipated Proceeds thereof. The Administrative Agent shall be responsible
for all other costs and expenses incurred by it in connection with any action
taken in respect of Leases or Vehicles; provided, however, that such costs and
expenses shall be Reimbursable Expenses only to the extent such costs and
expenses constitute Disposition Expenses or Insurance Expenses. All Termination
Proceeds and Insurance Proceeds shall be deposited and transferred as provided
in Section 2.06 and in any applicable Administration Supplement.
Notwithstanding the foregoing, prior to such deposit and transfer, the
Administrative Agent may elect to deduct from any Termination Proceeds or
Insurance Proceeds any unreimbursed Disposition Expenses and Insurance Expenses
in lieu of obtaining reimbursement for such expenses. In connection with this
Section, the Trustee, on behalf of the Trust, shall grant to the Administrative
Agent a power of attorney substantially in the form attached hereto as Exhibit
A with regard to the Vehicles, and the Administrative Agent, as "Grantee"
thereunder, with full power of substitution, shall give prompt notice to the
Trustee upon any such substitution.
Section 2.10. Administrative Agent to Act on Behalf of Trustee.
(a) The Administrative Agent shall be deemed to have received proper
instructions with respect to any of the books and records relating to the Trust
Assets, including any Lease Document or Rental Document, upon its receipt of
written instructions by a Responsible Officer of the Trustee or the Trust
Agent. A certified copy of a bylaw or resolution of the Board of Directors of
the Trustee or the Trust Agent shall constitute conclusive evidence of the
authority of any such Responsible Officer to act, and shall be considered in
full force and effect until receipt by the Administrative Agent of written
notice to the contrary given by the Trustee or the Trust Agent, as the case may
be.
(b) The Administrative Agent shall identify from time to time all (i)
UCC financing statements reflecting certain interests in Leases allocated to a
particular Sub-Trust and all related rights, (ii) periodic sales and use tax or
property (real or personal) tax reports, (iii) periodic renewals of licenses
and permits, (iv) periodic renewals of qualifications to act as a business
trust and (v) other periodic governmental filings, returns, registrations or
approvals (collectively, "Filings") arising with respect to or required of the
Trust or the Trustee, including (in the case of clauses (iii) and (v)) such
licenses, permits and other Filings as are required for the Trust or the
Trustee on behalf of the Trust, as the case may be, to accept assignments of
Leases or Vehicles, to be identified as the owner of the Vehicles on such
Certificates of Title and to maintain evidence of the Trust's or the Trustee's
ownership on such Certificates of Title, as contemplated by Sections 2.03 and
2.16. The Administrative Agent shall also identify any surety bonds or other
ancillary undertakings required of the Trust or the Trustee in respect of any
Filing. The Administrative Agent shall timely prepare and file or cause to be
filed (with, to the extent applicable, the cooperation of the UTI
Beneficiaries, the Trustee or the Trust) with the appropriate Person each
Filing and each such ancillary undertaking (in each case with a copy to the
Trustee) and shall pay any and all fees, taxes or expenses required to be paid
in connection with the foregoing (collectively, "Fees and Taxes"). In
connection with this Section, the Trustee shall grant to the Administrative
Agent such authority, including any necessary power of attorney (substantially
in the form attached hereto as Exhibit B) as it may require to effect each such
Filing or ancillary undertaking. In the event the Administrative Agent receives
notice or has actual knowledge of any non-compliance with any Filing
requirement, it shall promptly so notify the Trustee. Notwithstanding the
foregoing, the Administrative Agent shall in no event be required to perform
any of the actions specified in this Section in connection with any
requirements that may be applicable to any co-trustee (except to the extent
provided for in any applicable Co-Trustee Agreement to which the Administrative
Agent may be a party), separate trustee or nominee of the Trust.
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(c) The Administrative Agent agrees to indemnify, defend and hold
harmless the Trustee, the Delaware Trustee, the UTI Beneficiaries, the Holders
and their respective officers, directors, shareholders, employees and agents
(including any Trust Agent) for any Liability incurred as a result of any act,
or any failure to take action required to be taken pursuant to the Trust
Documents, by the Administrative Agent in connection with:
(i) the use or operation by the Administrative Agent or any
Affiliate thereof of any Vehicle; and
(ii) the Administrative Agent's maintenance and custody of the
information relating to the Trust Assets, the servicing of the Leases
or the Vehicles or any other activity undertaken or omitted (when
required to have been undertaken pursuant to the Trust Documents) by
the Administrative Agent with respect to any Trust Asset hereunder or
under an Administration Supplement, but only if and to the extent such
Liability arose out of the Administrative Agent's negligence, willful
misconduct or bad faith in the performance of its duties under this
Agreement or an Administration Supplement or in reckless disregard of
such duties; provided, however, that such indemnification by the
Administrative Agent shall not extend to any Liability incurred due to
(A) the negligence, willful misconduct or bad faith of the Trustee,
(B) an action taken (or omission to act) by the Administrative Agent
upon the written request of a Responsible Officer of the Trustee or
the Trust Agent, in each case except to the extent of the
Administrative Agent's negligence, willful misconduct or bad faith, if
any, in connection therewith or in response thereto, or (C) any
failure to cause any co-trustee, separate trustee or nominee of the
Trust to be identified as the owner of a Vehicle on any Certificate of
Title, unless the Administrative Agent is specifically requested to do
so by the Trustee.
The obligations of the Administrative Agent in this Section shall survive the
termination of this Agreement or the resignation or removal of the
Administrative Agent or the Trustee.
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Section 2.11. Fidelity Bond; Insurance.
(a) To the extent commercially available, the Administrative Agent
shall maintain a fidelity bond in (i) such form as is customary for financial
institutions acting as custodians of funds and documents in respect of mortgage
loans or consumer receivables on behalf of institutional investors and (ii) an
amount not less than $5 million. The cost of such fidelity bond shall be borne
by the Administrative Agent.
(b) The Administrative Agent shall make reasonable commercial efforts
to ensure that either Ryder or a related Lessee, as determined by the related
Lease, shall have, and maintain in full force and effect during the related
Lease Term, a comprehensive and collision physical damage insurance policy
(which may be self-insurance) naming the Trust or the Trustee on behalf of the
Trust, as applicable, depending on the name shown or to be shown as the owner
on the related Certificate of Title, as a "loss payee". The Administrative
Agent shall also take steps to ensure that either Ryder or a related Lessee
also maintains (and, in the case of Vehicles subject to a Lease, in accordance
with the terms of such Lease) vehicle liability insurance (which may be
self-insurance) naming the Trustee, on behalf of the Trust, as an additional
insured. The Administrative Agent shall, in accordance with its customary
servicing procedures, take appropriate steps to confirm and ensure that either
Ryder or a related Lessee maintains the above insurance in respect of the
Vehicles (and, in the case of Vehicles subject to a Lease, in accordance with
the terms of the related Leases). If a Lessee fails to obtain or maintain
required insurance, the Administrative Agent may (i) obtain insurance on behalf
of and at the expense of such Lessee or (ii) deem the related Lease to be in
default, and the Administrative Agent shall determine whether to repossess the
related Vehicle in accordance with Section 2.08 or otherwise seek enforcement
of such Lease.
Section 2.12. Administrative Agent Not to Resign; Assignment.
(a) Except as provided in Section 5.01(c) or 8.01, the Administrative
Agent shall not resign from the duties and obligations imposed on it hereby as
Administrative Agent, except upon a determination by its Board of Directors
that by reason of a change in applicable legal requirements, the continued
performance by the Administrative Agent of its duties as Administrative Agent
under this Agreement would cause it to be in violation of such legal
requirements in a manner that would result in a material adverse effect on the
Administrative Agent or its financial condition, such determination to be
evidenced by the delivery to the Trustee of a Board Resolution and an Opinion
of Counsel to such effect. No such resignation shall become effective until the
earlier of (i) 45 days after the delivery to the Trustee of such notice and
(ii) the date upon which the Administrative Agent becomes unable to act as
Administrative Agent, as specified in such notice and Opinion of Counsel. The
Administrative Agent shall, during such period, assist the Trustee in finding a
new Administrative Agent, which Person shall enter into a new administration
agreement with the Trust, such agreement to have substantially the same
provisions as this Agreement. The Trustee shall not unreasonably withhold its
consent to such administration agreement.
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(b) The Administrative Agent may not assign this Agreement or any of
its rights, powers, duties or obligations hereunder; provided, however, that
the Administrative Agent may assign this Agreement in connection with a
consolidation, merger, conveyance, transfer or lease made in compliance with
Section 2.13.
(c) Except as otherwise provided in this Section, the duties and
obligations of the Administrative Agent under this Agreement shall continue
until the Administrative Agent is replaced pursuant to Section 5.01(c) or until
this Agreement shall have been terminated as provided in Section 8.01 and shall
survive the exercise by the Trustee of any right or remedy under this Agreement
or the enforcement by the Trustee of any provision of the other Trust
Documents.
Section 2.13. Merger.
(a) the Administrative Agent shall not consolidate with or merge into
any other corporation or convey, transfer or lease all or substantially all of
its assets as an entirety to any Person, in either case without the prior
written consent of the Trustee, unless (i) the corporation to be formed by such
consolidation or into which the Administrative Agent is to be merged or the
Person that is to acquire by conveyance, transfer or lease all or substantially
all of the assets of the Administrative Agent as an entirety (A) is an entity
organized and existing under the laws of the United States or any State and (B)
either executes and delivers to the Trustee an agreement, in form and substance
reasonably satisfactory to the Trustee, containing an assumption by such
successor entity of the due and punctual performance and observance of each
covenant and condition to be performed or observed by the Administrative Agent
under this Agreement and the other Trust Documents or will be so bound by
operation of law or (ii) the Administrative Agent will be the surviving
corporation resulting from such consolidation or merger.
(b) Any corporation (i) into which the Administrative Agent may be
merged or consolidated, (ii) that may result from any merger, conversion or
consolidation to which the Administrative Agent shall be a party, (iii) that
may succeed to all or substantially all of the business of the Administrative
Agent or (iv) more than 50% of the voting stock of which is directly or
indirectly owned by Ryder or any Affiliate thereof and that is otherwise
servicing truck, tractor and trailer leases, which corporation in any of the
foregoing cases executes an agreement of assumption to perform every obligation
of the Administrative Agent under the Trust Documents, shall be the successor
to the Administrative Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties to
this Agreement. The Administrative Agent shall provide notice of any merger,
consolidation or succession pursuant to this Section to the Trustee and, if any
Rated Securities are outstanding, each Rating Agency. The Administrative Agent
may appoint one or more nominees to hold title to any or all Trust Assets in
the name of such nominee title holder for the sole and exclusive benefit of the
Trust and, upon the appointment of such nominee title holder, the Trustee
shall, on behalf of the Trust, transfer title to all or such portion of the
Trust Assets as directed by the Administrative Agent.
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Section 2.14. Limitation on Liability of Administrative Agent.
(a) Neither the Administrative Agent nor any of its directors,
officers, employees or agents shall be under any Liability to the Trust, the
Trustee, any Beneficiary, any Holder or any third party beneficiary of this
Agreement or any other Trust Document, except as otherwise provided in the
applicable Trust Document, for any action taken or for refraining from the
taking of any action pursuant to this Agreement or any other Trust Document, or
for errors in judgment; provided, however, that this provision shall not
protect the Administrative Agent or any such individual against any Liability
that would otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of duties or by reason of reckless disregard of
obligations or duties under this Agreement or any other Trust Document.
(b) Except as otherwise provided in this Agreement or any other Trust
Document, the Administrative Agent shall not be under any obligation to appear
in, prosecute or defend any Proceeding not incidental to its duties to service
the Leases in accordance with this Agreement, and that in its opinion may
involve it in any Liability; provided, however, that the Administrative Agent
may undertake any reasonable action it may deem necessary or desirable in
respect of this Agreement and the rights and duties of the parties hereto and
the interests of the Trust, and any reasonable expense related to any such
undertaking by the Administrative Agent shall be a Reimbursable Expense.
(c) The Administrative Agent and any director, officer, employee or
agent thereof may rely in good faith on the advice of counsel or on any
document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising under this Agreement or any other Trust
Document.
Section 2.15. Administrative Agent Reimbursement.
(a) The Administrative Agent may obtain on any day from the Trust,
from amounts on deposit in the UTI Collection Account and in accordance with
any related Administration Supplement, reimbursement for any Reimbursable
Expense; provided, that (i) the Administrative Agent shall have delivered to
the Trustee an Officer's Certificate setting forth the calculation of such
Reimbursable Expenses and (ii) any such reimbursement may not exceed the
excess, if any, as of the date immediately preceding the date of such Officer's
Certificate, of the UTI Collection Account Balance over the Required UTI
Collection Account Balance.
(b) The Administrative Agent may obtain from the Trust the balance of
any unreimbursed Reimbursable Expenses for all prior Collection Periods upon
presentation during any Collection Period to the Trustee of the reports
required pursuant to Section 4.01(c) with respect to the immediately preceding
Collection Period; provided, that the Administrative Agent may not obtain
reimbursement of Reimbursable Expenses pursuant to this Section in excess of
the lesser of (i) the aggregate amount of unreimbursed Reimbursable Expenses
incurred during all previous Collection Periods and (ii) the amount calculated
pursuant to Section 2.15(a)(ii).
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Section 2.16. Eligible Leases; Documentation. Ryder shall, in the
ordinary course of its business, generate Eligible Leases. Ryder may from time
to time assign to the Trust or the Trustee on behalf of the Trust all Eligible
Leases, the Vehicles relating thereto and any Rental Vehicles and the
Certificates of Title to such Vehicles, and shall do so with the proper name on
the Certificate of Title as specified by the Administrative Agent in accordance
with Section 2.03. Ryder shall deliver or cause to be delivered the related
Lease Documents or Rental Documents to or upon the order of the Administrative
Agent. The obligations of the Administrative Agent pursuant to this Section
shall survive any partial or complete termination of the Administrative Agent
pursuant to this Agreement. Ryder may lease from the Trust any UTI Vehicles or
Rental Vehicles, in each case pursuant to, and in accordance with the
provisions of, the UTI Master Lease.
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ARTICLE THREE
MAINTENANCE PROVIDER
Section 3.01. Provision of Certain Specified Services and Maintenance.
(a) The Maintenance Provider shall, with respect to each Vehicle
subject to a Lease, as provided under, and in material accordance with, each
such Lease:
(i) supply or cause to be supplied all parts and labor necessary
to keep the Vehicles in good operating condition, using that degree of
skill, care and attention in accordance with the customary and usual
procedures employed by the Maintenance Provider in maintaining similar
vehicles for its own account. In connection therewith, the Maintenance
Provider shall perform periodic preventative maintenance on the
Vehicles and other scheduled and non-scheduled maintenance and repairs
on and to the Vehicles, and shall create and store all Vehicle
maintenance records;
(ii) wash the Vehicles, provide emergency road service for
mechanical and tire failures involving the Vehicles, paint and decal
the Vehicles and assist the Lessee in formulating specifications for
the Vehicles;
(iii) apply for and obtain vehicle licenses and registrations and
other required road, fuel and mileage permits for the Vehicles, pay
taxes imposed on the Vehicles and complete and submit the related tax
returns;
(iv) rent vehicles on a short-term basis as (A) substitutes for
Vehicles that have been rendered inoperable due to temporary
mechanical failure, (B) replacement vehicles for Vehicles that are out
of service for the repair of physical damage and (C) extra vehicles to
meet seasonal fluctuations in the Lessee's business;
(v) provide fuel for the Vehicles, conduct periodic safety checks
of the Vehicles at fueling times and perform fuel tax reporting; and
(vi) administer a transportation safety program (including
conducting periodic safety meetings), verify that the Lessee's drivers
are properly licensed, assist the Lessee in satisfying related
regulatory requirements and monitor the Lessee's drivers' safety
records.
(b) The Maintenance Provider shall, with respect to each Rental
Vehicle, as provided under, and in material accordance with, each related
Rental Agreement (as amended by any applicable Lease) and applicable law:
(i) supply or cause to be supplied all parts and labor necessary
to keep such Rental Vehicle in good operating condition, using that
degree of care, skill and attention in accordance with the customary
and usual procedures employed by the Maintenance Provider in
maintaining similar vehicles for its own account. In connection
therewith, the Maintenance Provider shall perform periodic
preventative maintenance and other scheduled and non-scheduled
maintenance and repairs thereon and thereto, and shall create and
store maintenance records relating thereto;
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(ii) provide emergency road service for mechanical and tire
failures;
(iii) apply for and maintain vehicle licenses and registrations
and other required road, fuel and mileage permits, pay taxes imposed
thereon and complete and submit the related tax returns; and
(iv) provide fuel, conduct periodic safety checks at fueling
times and perform fuel tax reporting.
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ARTICLE FOUR
STATEMENTS AND REPORTS
Section 4.01. Reporting by the Administrative Agent; Delivery of
Certain Documentation.
(a) On or prior to the date hereof, and periodically thereafter as
required in order to update the contents thereof upon any changes in the
matters certified therein, the Administrative Agent shall furnish to the
Trustee and each Beneficiary an Officer's Certificate listing the officers of
the Administrative Agent involved in, or responsible for, the servicing of the
related Leases and Vehicles.
(b) The Administrative Agent shall retain or cause to be retained all
data (including, without limitation, computerized records, operating software
and related documentation) relating directly to or maintained in connection
with the servicing of the Leases and the Vehicles. Upon the occurrence and
continuance of an Administrative Agent Default and termination of the
Administrative Agent's obligations under this Agreement, the Administrative
Agent shall use commercially reasonable efforts to effect the orderly and
efficient transfer of the servicing of the Leases and the Vehicles to a
successor as provided in Section 5.01(c).
(c) On or before each Determination Date, the Administrative Agent
shall, with respect to (i) the UTI, upon request and (ii) each SUBI, as
specified in a related Administration Supplement, cause to be delivered to (A)
the Trustee, a revised Schedule of Vehicles, containing data as of the last day
of the related Collection Period, (B) the Trustee and the Related Beneficiary,
a report in respect of such Collection Period setting forth any information
required to be set forth therein by the related Administration Supplement and
(C) the Trustee, to the extent reimbursement is requested pursuant to Section
2.15, an Officer's Certificate of the Administrative Agent identifying all
related Leases and Vehicles acquired by the Trust during such Collection
Period, the aggregate cost of such acquisitions, the amount transferred by the
Administrative Agent during such Collection Period to fund such acquisitions,
the amount of all Reimbursable Expenses paid by the Administrative Agent during
such Collection Period, the amount of all Capital Contributions made by the
Related Beneficiary during such Collection Period, the amount of any transfer
during such Collection Period into the related Collection Account and the
balance due the Administrative Agent with respect to any unreimbursed Advances.
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ARTICLE FIVE
ADMINISTRATIVE AGENT DEFAULTS
Section 5.01. Administrative Agent Defaults; Termination of
Administrative Agent.
(a) Any of the following acts or occurrences shall constitute a
default hereunder (each, an "Administrative Agent Default"):
(i) the Administrative Agent shall fail to deliver to the Trustee
for distribution to or for the account of a Holder, any amounts
required to be so distributed pursuant to this Agreement (including a
related Administration Supplement), and such failure shall have
continued for a period of five Business Days after either discovery by
an officer of the Administrative Agent of such failure or written
notice of such failure shall have been given to the Administrative
Agent by the Trustee or such Holder; provided, however, that any such
failure with respect to any Sub-Trust shall be an Administrative Agent
Default only with respect to such Sub-Trust and not with respect to
any other Sub-Trust;
(ii) the Administrative Agent shall fail to duly observe or
perform any of its covenants or agreements in this Agreement or an
Administration Supplement, which failure materially and adversely
affects the rights of the Trust or a related Holder, and such default
shall have continued for a period of 90 days after written notice
thereof shall have been given to the Administrative Agent by the
Trustee or such Holder; provided, however, that (A) any such default
with respect to any Sub-Trust shall be an Administrative Agent Default
only with respect to such Sub-Trust and not with respect to any other
Sub-Trust, and (B) the determination of materiality with respect to
any Sub-Trust shall be made by reference to the related Holder and not
by reference to any other Holder;
(iii) (A) the existence of any Proceeding in, or the entry of a
decree or order for relief by, a court or regulatory authority having
jurisdiction over the Administrative Agent in an involuntary case
under the federal bankruptcy laws, as now or hereafter in effect, (B)
the appointment of a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official with respect to the
Administrative Agent or any substantial part of its property or (C)
the ordering of the winding up or liquidation of the affairs of the
Administrative Agent, and in each case, the continuance of any such
Proceeding, decree or order unstayed and, in the case of any such
decree or order, in effect for a period of 90 consecutive days;
(iv) (A) the commencement by the Administrative Agent of a
voluntary case under the federal bankruptcy laws, as now or hereafter
in effect, (B) the consent by the Administrative Agent to the
appointment of or taking of possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official
with respect to the Administrative Agent or any substantial part of
its property, (C) the making by the Administrative Agent of an
assignment for the benefit of creditors, (D) the failure by the
Administrative Agent generally to pay its debts as such debts become
due or (E) the taking of corporate action by the Administrative Agent
in furtherance of any of the foregoing;
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(v) any representation, warranty or statement of the
Administrative Agent made in this Agreement or in a related
Administration Supplement (excluding those contemplated by Section
2.05(a)) or any certificate, report or other writing delivered
pursuant to this Agreement or any other document relating to the Trust
to which the Administrative Agent is a party or by which it is bound
shall prove to have been incorrect in any material respect when made
and has a material adverse effect on a related Holder, and such
material adverse effect continues for a period of 30 days after
written notice thereof shall have been given to the Administrative
Agent by the Trustee or such Holder; provided, however, that (A) any
such incorrect representation, warranty or statement made with respect
to any Sub-Trust shall be an Administrative Agent Default only with
respect to such Sub-Trust and not with respect to any other Sub-Trust
and (B) the determination of a material adverse effect with respect to
any Sub-Trust shall be made only by reference to the related Holder
and not to any other Holder; or
(vi) the Administrative Agent shall fail to deliver to the
Trustee any report required to be delivered to the Trustee pursuant to
this Agreement within 30 Business Days after the date such report is
due; provided, however, that (A) any such failure with respect to any
Sub-Trust shall be an Administrative Agent Default only with respect
to such Sub-Trust and not with respect to any other Sub-Trust and (B)
the Administrative Agent may, within 60 days after the date such
report is due, cure such Administrative Agent Default by delivering to
the Trustee such report.
Notwithstanding the foregoing, a delay in or failure of performance under
clause (i) for a period of ten Business Days, under clause (ii) for a period of
180 days, under clause (v) for a period of 90 days or under clause (vi) for a
period of 60 Business Days, shall not constitute an Administrative Agent
Default if caused by a Force Majeure Event.
(b) Upon the occurrence of a Force Majeure Event, the Administrative
Agent shall (i) make commercially reasonable efforts to perform its obligations
hereunder in a timely manner in accordance with the terms of this Agreement and
(ii) provide to the Trustee, the UTI Beneficiaries, the Related Beneficiary and
each related Holder prompt notice of such Force Majeure Event and the resulting
delay or failure in performance to which such Force Majeure Event relates,
together with a description of its efforts to so perform its obligations
hereunder.
(c) If an Administrative Agent Default shall have occurred and be
continuing with respect to one or more Sub-Trusts, the Trustee may remedy such
Administrative Agent Default, or the Trustee on behalf of the Trust shall, at
the direction of the Required Related Holders (which, with respect to an
Administrative Agent Default relating to a SUBI, shall not include the UTI
Beneficiaries and which, with respect to an Administrative Agent Default
relating only to the UTI, shall only include the UTI Beneficiaries), or, if
applicable, the holders of Rated Securities (in the manner provided for in the
related Administration Supplement), by notice given to the Administrative
Agent, the UTI Beneficiaries and the related Holders (and, if applicable, to
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the holders of such Rated Securities), terminate all (or, if such
Administrative Agent Default relates only to a particular Sub-Trust, the
applicable portion) of the rights and obligations of the Administrative Agent
under this Agreement and the related Administration Supplement, including all
or a portion (allocable to the rights and obligations terminated) of the rights
of the Administrative Agent to receive the servicing compensation provided for
in Section 2.07 (or the applicable portion thereof) with respect to such
Sub-Trust following the assumption by a successor of the Administrative Agent's
duties hereunder. Upon any such termination, the Administrative Agent shall
continue to perform its functions as Administrative Agent until the earlier of
the date specified in the termination notice or, if no such date is specified
therein, the date of the Administrative Agent's receipt of such notice, at
which time all rights, powers, duties, obligations and responsibilities of the
Administrative Agent under this Agreement and the related Administration
Supplement, whether with respect to the Administration Fee or otherwise, so
terminated with respect to one or more Sub-Trusts shall, as applicable, vest in
and be assumed by any successor administrative agent appointed by the Trustee
pursuant to an administration agreement with the Trust and the Related
Beneficiary, containing substantially the same provisions as this Agreement in
respect of the related Sub-Trust (including those with respect to the
compensation of such successor administrative agent; provided, however, that
such successor shall have no responsibilities with respect to the purchase of
additional Leases and Vehicles by the Trust or with respect to making
Advances), and the Trustee is hereby irrevocably authorized and empowered to
execute and deliver, on behalf of the Administrative Agent, as attorney-in-fact
or otherwise, all documents and other instruments (including any notices to
Lessees deemed necessary or advisable by the Trustee), and to do or accomplish
all other acts or things necessary or appropriate to effect such vesting and
assumption, including, without limitation, directing any or all of the related
Lessees to remit payments on or in respect of the related Leases and Vehicles
to an account or address designated by the Trustee or such new administrative
agent. Without limitation of the foregoing, if the rights of the Administrative
Agent shall have been terminated in accordance with Section 8.01 with regard to
any Sub-Trust, the Administrative Agent shall, upon demand of the Trustee or
upon direction of the Related Beneficiary, deliver to the Trustee or the
successor Administrative Agent copies of all books and records necessary for
the servicing of the related Leases and Vehicles, all related monies collected
by it and required to be deposited, as appropriate, in any Trust Account or
other account relating to each such Sub-Trust, and any related Vehicle in its
possession and that, in the case of an Expired Vehicle or Defaulted Vehicle,
has not yet been sold or otherwise disposed of pursuant to Section 2.09 or
purchased by the Administrative Agent pursuant to Section 2.05(f). In addition,
the Administrative Agent shall use its commercially reasonable efforts to
effect the orderly and efficient transfer of the servicing of the related
Leases and Vehicles included in each Sub-Trust with respect to which such
termination shall have occurred to the party that will be assuming
responsibility for such servicing and, as promptly as practicable, the
Administrative Agent shall provide the new Administrative Agent with a current
computer tape containing all information required for the servicing of the
related Leases and Vehicles, together with documentation containing any and all
information necessary for use of such computer tape. All reasonable costs and
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expenses (including the Administrative Agent's conversion costs and attorneys'
fees) incurred in connection with transferring the servicing of the related
Leases and Vehicles to the new Administrative Agent and amending this Agreement
to reflect such succession as Administrative Agent pursuant to this Section
shall be paid by the predecessor Administrative Agent (or, if the predecessor
Administrative Agent is the initial Trustee, the initial Administrative Agent)
upon presentation of reasonable documentation of such costs and expenses.
If a successor Administrative Agent is not appointed by the effective
date of the predecessor Administrative Agent's termination hereunder or
resignation pursuant to Section 2.12, the Trustee shall act as successor
Administrative Agent with respect to the Sub-Trust or Sub-Trusts affected
thereby. If the Trustee is unwilling or legally unable to so act, then the
Trustee shall promptly appoint, or petition a court of competent jurisdiction
to appoint, as successor Administrative Agent with respect to such Sub-Trust or
Sub-Trusts, any established entity the regular business of which includes the
servicing of truck, tractor and trailer leases.
In the event of the partial termination by the Trustee of any, but not
all, of the Administrative Agent's rights and powers hereunder, the
Administrative Agent (and, except with respect to UTI Assets, unless otherwise
directed by the Trustee) shall continue to service, administer and collect
Leases and Vehicles in unaffected Sub-Trusts and shall have the right to
receive servicing compensation in accordance with Section 2.07 with respect to
all such unaffected Sub-Trusts.
(d) The Trustee may waive any default by the Administrative Agent in
the performance of its obligations hereunder and its consequences with regard
to any Sub-Trust, except that any such waiver in respect of a Sub-Trust created
pursuant to a Supplement may only be given in accordance with such Supplement
or the related Administration Supplement. Upon any such waiver by the Trustee
of a past default, such default shall cease to exist, and any Administrative
Agent Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement and the related Supplement or Administration
Supplement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
(e) Any compensation payable to a successor Administrative Agent may
not be in excess of that permitted the predecessor Administrative Agent unless
the related Holders bear such excess costs exclusively.
(f) The remedies provided pursuant to this Section for an
Administrative Agent Default shall constitute the sole and exclusive remedy
therefor.
Section 5.02. No Effect on Other Parties. Upon any complete or partial
termination of the rights and powers of the Administrative Agent from time to
time pursuant to Section 8.01 or upon any appointment of a successor to the
Administrative Agent with respect to all or a portion of the Trust Assets, all
rights, powers, duties and obligations of the Trust and the Trustee under this
Agreement or any other Trust Document shall remain unaffected by such
termination or appointment and shall remain in full force and effect
thereafter, except as otherwise expressly provided in this Agreement or in any
other Trust Document.
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ARTICLE SIX
MAINTENANCE PROVIDER DEFAULTS
Section 6.01. Maintenance Provider Defaults; Termination of
Maintenance Provider.
(a) Any of the following acts or occurrences shall constitute a
default with respect to the Maintenance Provider (each, a "Maintenance Provider
Default"):
(i) the Maintenance Provider shall fail to duly observe or
perform any of its covenants or agreements in this Agreement or any
Administration Supplement, which failure materially and adversely
affects the rights of the Trust or a related Holder, and such default
shall have continued for a period of 90 days after written notice
thereof shall have been given to the Maintenance Provider by the
Trustee or such Holder; provided, however, that (A) any such default
with respect to any Sub-Trust shall be a Maintenance Provider Default
only with respect to such Sub-Trust and not with respect to any other
Sub-Trust, and (B) the determination of materiality with respect to
any Sub-Trust shall be made only by reference to the related Holder
and not by reference to any other Holder;
(ii) (A) the existence of any Proceeding in, or the entry of a
decree or order for relief by, a court or regulatory authority having
jurisdiction over the Maintenance Provider in an involuntary case
under the federal bankruptcy laws, as now or hereafter in effect, (B)
the appointment of a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official with respect to the
Maintenance Provider or any substantial part of its property or (C)
the ordering of the winding up or liquidation of the affairs of the
Maintenance Provider, and in each case, the continuance of any such
Proceeding, decree or order unstayed and, in the case of any such
decree or order, in effect for a period of 90 consecutive days;
(iii) (A) the commencement by the Maintenance Provider of a
voluntary case under the federal bankruptcy laws, as now or hereafter
in effect, (B) the consent by the Maintenance Provider to the
appointment of or taking of possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official
with respect to the Maintenance Provider or any substantial part of
its property, (C) the making by the Maintenance Provider of an
assignment for the benefit of creditors, (D) the failure by the
Maintenance Provider generally to pay its debts as such debts become
due or (E) the taking of corporate action by the Maintenance Provider
in furtherance of any of the foregoing; or
(iv) any representation, warranty or statement of the Maintenance
Provider made in this Agreement or in a related Administration
Supplement or any certificate, report or other writing delivered
pursuant to this Agreement or any other document relating to the Trust
to which the Maintenance Provider is a party or by which it is bound
shall prove to have been incorrect in any material respect when made
and has a material adverse effect on a related Holder, and such
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material adverse effect continues for a period of 30 days after
written notice thereof shall have been given to the Maintenance
Provider by the Trustee or the related Holder; provided, however, that
(A) any such incorrect representation, warranty or statement made with
respect to any Sub-Trust shall be a Maintenance Provider Default only
with respect to such Sub-Trust and not with respect to any other
Sub-Trust and (B) the determination of a material adverse effect with
respect to any Sub-Trust shall be made only by reference to the
related Holder and not to any other Holder.
Notwithstanding the foregoing, a delay in or failure of performance referred to
under clause (i) for a period of 180 days or under clause (iv) for a period of
90 days, shall not constitute a Maintenance Provider Default if caused by a
Force Majeure Event.
(b) Upon the occurrence of a Force Majeure Event, the Maintenance
Provider shall (i) make commercially reasonable efforts to perform its
obligations hereunder in a timely manner in accordance with the terms of this
Agreement and (ii) provide to the Trustee, the UTI Beneficiaries, the Related
Beneficiary and each related Holder prompt notice of such Force Majeure Event
and the resulting delay or failure in performance to which such Force Majeure
Event relates, together with a description of its efforts to so perform its
obligations hereunder.
(c) If a Maintenance Provider Default shall have occurred and be
continuing with respect to one or more Sub-Trusts, the Trustee may cause such
Maintenance Provider Default to be remedied, or the Trustee on behalf of the
Trust shall, at the direction of the Required Related Holders (which, with
respect to a Maintenance Provider Default relating to a SUBI, shall not include
the UTI Beneficiaries and which, with respect to a Maintenance Provider Default
relating only to the UTI, shall only include the UTI Beneficiaries), or, if
applicable, the holders of Rated Securities (in the manner provided for in the
related Administration Supplement), by notice given to the Maintenance
Provider, the UTI Beneficiaries and the related Holders (and, if applicable, to
the holders of such Rated Securities), terminate all (or, if such Maintenance
Provider Default relates only to a particular Sub-Trust, the applicable
portion) of the rights and obligations of the Maintenance Provider under this
Agreement and the related Administration Supplement. Upon any such termination,
the Maintenance Provider shall continue to perform its functions as Maintenance
Provider until the earlier of the date specified in the termination notice or,
if no such date is specified therein, the date of the Maintenance Provider's
receipt of such notice, at which time all rights, powers, duties, obligations
and responsibilities of the Maintenance Provider under this Agreement and the
related Administration Supplement so terminated with respect to one or more
Sub-Trusts shall, as applicable, vest in and be assumed by any successor
Maintenance Provider appointed by the Trustee pursuant to an agreement with the
Trust and the Related Beneficiary, containing substantially the same provisions
as this Agreement relating to the Maintenance Provider in respect of the
related Sub-Trust, and the Trustee is hereby irrevocably authorized and
empowered to execute and deliver, on behalf of the Maintenance Provider, as
attorney-in-fact or otherwise, all documents and other instruments (including
any notices to Lessees deemed necessary or advisable by the Trustee), and to do
or accomplish all other acts or things necessary or appropriate to effect such
vesting and assumption. Without limitation of the foregoing, if the rights of
the Maintenance Provider shall have been terminated in accordance with Section
8.01 with regard to any Sub-Trust, the Maintenance Provider shall, upon demand
of the Trustee or upon direction of the Related Beneficiary, deliver to the
Trustee or the successor Maintenance Provider copies of all books and records
necessary for the maintenance of the related Vehicles. In addition, the
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Maintenance Provider shall use its commercially reasonable efforts to effect
the orderly and efficient transfer of the maintenance of the related Vehicles
included in each Sub-Trust with respect to which such termination shall have
occurred to the party that will be assuming responsibility for such
maintenance. All reasonable costs and expenses (including attorneys' fees)
incurred in connection with transferring the maintenance of the related
Vehicles to the new Maintenance Provider and amending this Agreement to reflect
such succession as Maintenance Provider pursuant to this Section shall be paid
by the predecessor Maintenance Provider upon presentation of reasonable
documentation of such costs and expenses.
If a successor Maintenance Provider is not appointed by the effective
date of the predecessor Maintenance Provider's termination hereunder, the
Trustee shall promptly appoint, or petition a court of competent jurisdiction
to appoint, as successor Maintenance Provider with respect to the related
Sub-Trust, any established entity the regular business of which includes the
provision of services, supplies and maintenance with respect to trucks,
tractors and trailers. Notwithstanding anything to the contrary in this
Agreement, the Trustee shall in no event be required to act as successor
Maintenance Provider hereunder.
In the event of the partial termination by the Trustee of any, but not
all, of the Maintenance Provider's rights and powers hereunder, the Maintenance
Provider (and, except with respect to UTI Assets, unless otherwise directed by
the Trustee) shall continue to provide maintenance with respect to Vehicles in
unaffected Sub-Trusts.
(d) The Trustee may waive any default by the Maintenance Provider in
the performance of its obligations hereunder and its consequences with regard
to any Sub-Trust, except that any such waiver in respect of a Sub-Trust created
pursuant to a Supplement may only be given in accordance with such Supplement
or the related Administration Supplement. Upon any such waiver by the Trustee
of a past default, such default shall cease to exist, and any Maintenance
Provider Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement and the related Supplement or Administration
Supplement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
(e) The remedies provided pursuant to this Section for a Maintenance
Provider Default shall constitute the sole and exclusive remedy therefor.
Section 6.02. No Effect on Other Parties. Upon any complete or partial
termination of the Maintenance Provider from time to time pursuant to Section
6.01 or upon any appointment of a successor to the Maintenance Provider with
respect to all or a portion of the Trust Assets, all rights, powers, duties and
obligations of the Trust and the Trustee under this Agreement or any other
Trust Document shall remain unaffected by such termination or appointment and
shall remain in full force and effect thereafter, except as otherwise expressly
provided in this Agreement or in any other Trust Document.
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ARTICLE SEVEN
ADMINISTRATIVE AGENT REPRESENTATIONS AND WARRANTIES
Section 7.01. Representations and Warranties. As of each related
Administrative Agent Representation Date, the Administrative Agent hereby makes
the following representations and warranties with respect to each Sub-Trust to
the Trust, the UTI Beneficiaries and each Related Beneficiary:
(a) Organization and Good Standing. The Administrative Agent has
been duly organized and validly existing as a corporation in good
standing under the laws of the State of Florida, 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, and had at all relevant times, and has the power, authority
and legal right to acquire, own, sell and service the Leases and the
Vehicles and to hold the Lease Documents and the Rental Documents as
agent, custodian and bailee on behalf of the Trust, except where
failure to do so will not have a material adverse effect on the
Administrative Agent's ability to perform its obligations under this
Agreement.
(b) Due Qualification. The Administrative Agent 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 (including the servicing of the Leases and Vehicles as
required by this Agreement as supplemented by any related
Administration Supplement) requires such qualifications except when
the failure to have any such license, approval or qualification would
not have a material adverse effect on the condition, financial or
otherwise, of the Administrative Agent or would not have a material
adverse effect on the ability of the Administrative Agent to perform
its obligations under this Agreement as supplemented by any related
Administration Supplement.
(c) Power and Authority. The Administrative Agent has the
corporate power and authority to execute and deliver this Agreement as
supplemented by any related Administration Supplement and to carry out
the terms thereof; and the execution, delivery and performance of this
Agreement as supplemented by any related Administration Supplement has
been duly authorized by the Administrative Agent by all necessary
corporate action.
(d) Binding Obligation. This Agreement as supplemented by any
related Administration Supplement constitutes a legal, valid and
binding obligation of the Administrative Agent enforceable against the
Administrative Agent in accordance with its terms, except as such
enforceability may be subject to or limited by bankruptcy, insolvency,
reorganization, moratorium, liquidation, fraudulent conveyance or
other similar laws affecting the enforcement of creditors' rights in
general and by general principles of equity or public policy,
regardless of whether such enforceability shall be considered in a
Proceeding in equity or in law.
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(e) No Violation. The consummation of the transactions
contemplated by, and the fulfillment of the terms of, this Agreement
as supplemented by any related Administration Supplement will not (i)
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 Administrative
Agent, or conflict with or breach any of the material terms or
provisions of, or constitute (with or without notice or lapse of time)
a default under, any material indenture, agreement or other instrument
to which the Administrative Agent is a party or by which it is bound,
(ii) result in the creation or imposition of any material lien upon
any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than this Agreement or a related
Administration Supplement) or (iii) violate any law or, to the best of
the Administrative Agent's knowledge, any order, rule or regulation
applicable to the Administrative Agent of any court or of any federal
or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Administrative Agent or
its properties; in each case which breach, default, conflict, lien or
violation would have a material adverse effect on the financial
position of the Administrative Agent.
(f) No Proceedings. There are no Proceedings or investigations
pending, or to the Administrative Agent's knowledge, threatened,
before any court, regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the
Administrative Agent or its properties: (i) asserting the invalidity
of this Agreement as supplemented by any related Administration
Supplement; (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement as supplemented by any
related Administration Supplement; (iii) to which the Administrative
Agent is a party, seeking any determination or ruling that might
materially and adversely affect the performance by the Administrative
Agent of its obligations under, or the validity or enforceability of,
this Agreement as supplemented by any related Administration
Supplement; or (iv) relating to the Administrative Agent and that
might adversely affect the federal income tax attributes of the Trust
or any Sub-Trust.
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ARTICLE EIGHT
MISCELLANEOUS
Section 8.01. Termination of Agreement. This Agreement shall
terminate, completely or in part with respect to one or more Sub-Trusts, upon
the earlier of (i) the dissolution of the Trust, (ii) the discharge of the
Administrative Agent in accordance with the terms of this Agreement (completely
or with regard to any of (a) the Administrative Agent's obligation to cause the
assignment of Leases, Vehicles and related Trust Assets to the Trust or (b) the
Administrative Agent's servicing obligations with regard to one or more
Sub-Trusts) or (iii) the mutual written determination of the parties hereto
(completely or in any part as set forth in clause (ii) above). Upon any
termination of the Administrative Agent's servicing obligations hereunder with
regard to any Sub-Trust, (i) the Maintenance Provider's obligations hereunder
shall not thereby be terminated with respect to such Sub-Trust and (ii) upon
payment of all amounts due to the Administrative Agent hereunder with respect
to such Sub-Trust (including related accrued Administration Fees and additional
servicing compensation payable in respect of such Sub-Trust and reimbursement
of any Advances), the Administrative Agent shall pay to or upon the order of
the Trustee or any other Person entitled thereto all monies held by the
Administrative Agent on behalf of the Trust or the Trustee with respect to such
Sub-Trust. Any termination of the Administrative Agent or the Maintenance
Provider with respect to one Sub-Trust shall not thereby effect a termination
of the Administrative Agent or the Maintenance Provider with respect to any
other Sub-Trust in existence at the time of such termination.
Section 8.02. Amendment.
(a) This Agreement may be amended as it relates to (i) the Trust, by
written agreement among the Trust, the UTI Beneficiaries, the Administrative
Agent and any additional Persons required by any Administration Supplement or
(ii) a particular Sub-Trust, by one or more Administration Supplements among
the Trust, the UTI Beneficiaries, the Administrative Agent and any additional
Persons required by the related Administration Supplement. An Administration
Supplement may provide, among other things, for further specific servicing
obligations with respect to the related Sub-Trust. Such Administration
Supplements may permit the termination of this Agreement insofar as it applies
to the related Sub-Trust, upon the terms and conditions set forth therein;
provided, that no SUBI Administration Supplement shall be effective to
authorize or effect the termination of this Agreement insofar as it relates to
the UTI or any Other SUBI, and no UTI Administration Supplement shall be
effective to authorize or effect the termination of this Agreement insofar as
it relates to any SUBI.
(b) This Agreement may be amended at any time by the UTI
Beneficiaries, the Trust and the Administrative Agent, without the consent of
any Holder or other Beneficiary, (i) to (A) cure any ambiguity, (B) correct or
supplement any provision herein that may be inconsistent with any other
provision herein, (C) add any provision that provides additional rights to
Holders or (D) ensure that none of the Trust, the Beneficiaries or the Holders
is classified as an association (or a publicly traded partnership) taxable as a
corporation for federal income tax purposes, as evidenced by an Opinion of
Counsel; provided, in each case, that such amendment will not, in the good
faith judgment of the parties thereto, materially and adversely affect the
interest of any Holder or (ii) for any other purpose, provided that an Opinion
of Counsel is delivered to the Trustee to the effect that such amendment or
supplement will not materially and adversely affect the interest of any Holder.
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(c) Any amendment or supplement effected contrary to the provisions of
this Section shall be void.
Section 8.03. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
Section 8.04. Relationship of this Agreement to Other Trust Documents.
Unless the context otherwise requires, this Agreement and the other Trust
Documents shall be interpreted so as to give full effect to all provisions
hereof and thereof. In the event of any actual conflict between the provisions
of this Agreement and (i) the Origination Trust Agreement, with respect to the
servicing of any Trust Assets, the provisions of this Agreement shall prevail
and (ii) any Administration Supplement with respect to the servicing of any
Related Trust Assets, the provisions of such Administration Supplement shall
control with respect to the related Sub-Trust.
Section 8.05. Notices. All demands, notices and communications
hereunder shall be in writing and shall be delivered or mailed by registered or
certified first-class United States mail, postage prepaid, hand delivery,
prepaid courier service, or by telecopier, and addressed in each case as
follows: (i) if to the Trust, at 3600 N.W. 82nd Avenue, Miami, Florida 33166
(telecopier no. (305) 500-3726), Attention: Treasurer 2C, with a copy to Serge
G. Martin, Esq., Law 5C, at the same street address (telecopier no. (305)
500-3198) (ii) if to Ryder Truck Rental I LP, at 3600 N.W. 82nd Avenue, Miami,
Florida 33166 (telecopier no. (305) 500-3726), Attention: Treasurer 2C, with a
copy to Serge G. Martin, Esq., Law 5C, at the same street address (telecopier
no. (305) 500-3198); (iii) if to Ryder Truck Rental II LP, at 3600 N.W. 82nd
Avenue, Miami, Florida 33166 (telecopier no. (305) 500-3726), Attention:
Treasurer 2C, with a copy to Serge G. Martin, Esq., Law 5C, at the same street
address (telecopier no. (305) 500-3198); (iv) if to the Administrative Agent,
at 3600 N.W. 82nd Avenue, Miami, Florida 33166 (telecopier no. (305) 500-3726),
Attention: Treasurer 2C, with a copy to Serge G. Martin, Esq., Law 5C, at the
same street address (telecopier no. (305) 500-3198); (v) if to the Trustee, at
One Illinois Center, 111 East Wacker Drive, Suite 3000, Chicago, Illinois 60601
(telecopier no. (312) 228-9401), Attention: Ryder Truck Leasing, with a copy
(which shall not constitute notice) to the Beneficiaries; or (vi) with respect
to any of the foregoing Persons, at such other address as shall be designated
by such Person in a written notice to the other foregoing Persons. Delivery
shall occur only upon receipt or rejected tender of such communication by an
officer of the recipient entitled to receive such notices located at the
address of such recipient for notices hereunder. A copy of all notices to the
Trustee shall be delivered to the Trust Agent.
Section 8.06. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement or any
Administration Supplement shall be for any reason whatsoever held invalid, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement, as
supplemented or amended, and shall in no way affect the validity or
enforceability of the other covenants, agreements, provisions or terms of this
Agreement or any Administration Supplement.
36
<PAGE> 41
Section 8.07. Inspection and Audit Rights. The Administrative Agent
agrees that, on reasonable prior notice, it will permit any representative or
designee of the Trustee, during the normal business hours of the Administrative
Agent, to examine all books of account, records, reports and other papers of
the Administrative Agent relating to the Trust Assets, to make copies and
extracts therefrom, to cause such books to be audited by Independent
Accountants selected by the Trustee, and to discuss the affairs, finances and
accounts relating to the Trust Assets with its officers and employees, all at
such reasonable times and as often as may be reasonably requested. Such rights
shall include, but shall not be limited to, any offsite storage facilities at
which any data (including, without limitation, computerized records), together
with all operating software and appropriate documentation, may be held. The
Trustee agrees to keep confidential all confidential information of the
Administrative Agent acquired during any such examination as if such
information were its own confidential information, except to the extent
necessary for the purposes of this Agreement. Any expense incident to the
exercise by the Trustee of any right under this Section shall be a Trust
Expense.
Section 8.08. Binding Effect. The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
permitted successors and assigns.
Section 8.09. Table of Contents and Headings. The Table of Contents
and Article and Section headings herein are for convenience of reference only
and shall not define or limit any of the terms or provisions hereof.
Section 8.10. Counterparts. This Agreement may be executed in any
number of counterparts, each of which so executed and delivered shall be deemed
to be an original, but all of which counterparts shall together constitute but
one and the same instrument.
Section 8.11. Further Assurances. Each party shall do such acts, and
execute and deliver to any other party such additional documents or
instruments, as may be reasonably requested in order to effect the purposes of
this Agreement and to better assure and confirm unto the requesting party its
rights, powers and remedies hereunder.
Section 8.12. Third Party Beneficiaries. The Holders of the UTI
Certificates shall be third party beneficiaries of this Agreement. The Related
Beneficiary, the related Holders and any other Person designated as a third
party beneficiary in an Administration Supplement shall be third party
beneficiaries of this Agreement as supplemented by such Administration
Supplement. Except as otherwise provided in this Agreement or an Administration
Supplement, no other Person shall have any rights hereunder.
Section 8.13. No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of any party hereto, any right, remedy,
power or privilege under this Agreement or any Administration Supplement shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges provided in this
Agreement and any Administration Supplement shall be cumulative and not
exhaustive of any rights, remedies, powers or privileges provided at law, in
equity or otherwise.
37
<PAGE> 42
Section 8.14. No Petition. The Administrative Agent covenants and
agrees that prior to the date that is one year and one day after the date on
which all obligations under each Securitized Financing have been paid in full,
the Administrative Agent will not institute against, or join with any other
Person in instituting against, the UTI Beneficiaries, the Trustee, the Trust,
any Special Purpose Affiliate, any Beneficiary, any general partner of a
Beneficiary or of a Special Purpose Affiliate that is a partnership or any
member of a Beneficiary or of a Special Purpose Affiliate (or any of their
respective general partners) that is a limited liability company, any
bankruptcy, reorganization, arrangement, insolvency or liquidation Proceeding
or other Proceeding under any federal or State bankruptcy or similar law. This
Section shall survive the complete or partial termination of this Agreement or
the complete or partial resignation or removal of the Administrative Agent.
38
<PAGE> 43
ARTICLE NINE AND TEN
[Reserved]
39
<PAGE> 44
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers duly authorized as of the day and
year first above written.
RYDER TRUCK RENTAL LT
By: RTRT, INC.,
as Trustee
By:
------------------------------
Name:
Title:
RYDER TRUCK RENTAL I LP,
as UTI Beneficiary
By: RYDER TRUCK RENTAL I LLC,
as General Partner
By:
------------------------------
Name:
Title:
RYDER TRUCK RENTAL II LP,
as UTI Beneficiary
By: RYDER TRUCK RENTAL II LLC,
as General Partner
By:
------------------------------
Name:
Title:
40
<PAGE> 45
RYDER TRUCK RENTAL, INC.,
as Administrative Agent
By:
------------------------------
Name: Serge G. Martin
Title: Assistant Secretary
RYDER TRUCK RENTAL, INC.,
as Maintenance Provider
By:
------------------------------
Name: Serge G. Martin
Title: Assistant Secretary
41
<PAGE> 46
EXHIBIT A
POWER OF ATTORNEY PURSUANT TO
SECTION 2.09(b) OF ADMINISTRATION AGREEMENT
KNOW ALL MEN BY THESE PRESENTS, that RTRT, Inc., a Delaware
corporation (the "Grantor"), located at One Illinois Center, 111 East Wacker
Drive, Suite 3000, Chicago, Illinois 60601, as trustee of Ryder Truck Rental
LT, a Delaware business trust (the "Trust"), does hereby appoint Ryder Truck
Rental, Inc., a Delaware corporation (the "Grantee"), located at 3600 N.W. 82nd
Avenue, Miami, Florida 33166, as its attorney-in-fact with full power of
substitution and hereby authorizes and empowers the Grantee, in the name of and
on behalf of the Grantor or the Trust, to take the following actions from time
to time with respect to the vehicles referred to as "Vehicles" in the
Administration Agreement, dated as of February 1, 1998 (the "Administration
Agreement"), among the Trust, Ryder Truck Rental I LP ("RTR I LP") and Ryder
Truck Rental II LP ("RTR II LP"), each a Delaware limited partnership, as UTI
Beneficiaries, and the Grantee, such Vehicles being more particularly described
in the currently effective "Schedule of Vehicles", as defined in the
Origination Trust Agreement described below, a copy of which Schedule of
Vehicles is maintained by the Grantee and is incorporated herein by this
reference as though fully set forth herein, for the purpose of enabling the
Grantee in the name of the Grantor or the Trust to transfer, liquidate or
dispose of the Vehicles, upon such terms and conditions as the Grantee deems
advisable, namely:
(a) Sign the Grantor's or the Trust's name to any bills of sale,
certificates of title, assignments of title, transfers of title or
registration, applications for title or registration, application for
transfer of title or registration, notices of sale, odometer
statements or similar forms with respect to any of the Vehicles; and
(b) Execute and deliver any and all instruments and take any and
all further action in the name of or on behalf of the Grantor or the
Trust as may be required or deemed desirable to accomplish any and all
of the foregoing and carry out the purposes of this Power of Attorney.
The Grantee is hereby empowered to do any and all lawful acts
necessary or desirable to effect the transfer of the Vehicles and the Grantor
hereby ratifies and confirms any and all lawful acts the Grantee shall
undertake pursuant to and in conformity with this Power of Attorney.
This Power of Attorney is revocable in whole or in part as to the
powers herein granted with respect to the Vehicles related to one or more
Sub-Trusts (as defined in the Origination Trust Agreement described below) upon
notice by the Grantor. If not earlier revoked, this Power of Attorney shall
expire completely or, if so indicated, in part, upon the earlier of (i) the
termination of that certain second amended and restated trust agreement, dated
as of February 1, 1998 (the "Origination Trust Agreement"), among RTR I LP and
RTR II LP, as grantors and initial beneficiaries, the Grantee, as
A-1
<PAGE> 47
Administrative Agent, the Grantor, as trustee, Delaware Trust Capital
Management, Inc., a Delaware banking corporation, as Delaware trustee, and, for
certain limited purposes set forth therein, U.S. Bank National Association, a
national banking association, as trust agent, and (ii) the termination of the
Administration Agreement (completely or with respect to the Administrative
Agent's servicing obligations relating to one or more Sub-Trusts), as each may
be amended, restated or supplemented from time to time. Capitalized terms used
herein that are not otherwise defined shall have the meanings ascribed thereto
in the Origination Trust Agreement.
This Power of Attorney shall be created under and governed and
construed under the internal laws of the State of New York.
The Grantor executes this Power of Attorney with the intent to be
legally bound hereby, and with the intent that such execution shall have the
full dignity afforded by the accompanying witnessing and notarization and all
lesser dignity resulting from the absence of such witnessing and notarization
or any combination thereof.
Dated this ______ day of February, 1998.
[Seal] RTRT, INC.,
as Trustee of Ryder Truck Rental LT
By:
---------------------------------
Signed and delivered in the
presence of:
- -------------------------------
Address:
[Unofficial Witness]
A-2
<PAGE> 48
EXHIBIT B
POWER OF ATTORNEY PURSUANT TO
SECTION 2.10(b) OF ADMINISTRATION AGREEMENT
KNOW ALL MEN BY THESE PRESENTS, that RTRT, Inc., a Delaware
corporation (the "Grantor"), located at One Illinois Center, 111 East Wacker
Drive, Suite 3000, Chicago, Illinois 60601, as trustee of Ryder Truck Rental
LT, a Delaware business trust (the "Trust"), does hereby appoint Ryder Truck
Rental, Inc., a Delaware corporation (the "Grantee"), located at 3600 N.W. 82nd
Avenue, Miami, Florida 33166, as its attorney-in-fact, with full power of
substitution and hereby authorizes and empowers the Grantee, in the name of and
on behalf of the Grantor or the Trust, to take the following actions from time
to time with respect to certain filings referred to in the Administration
Agreement, dated as of February 1, 1998 (the "Administration Agreement"), among
the Trust, Ryder Truck Rental I LP ("RTR I LP") and Ryder Truck Rental II LP
("RTR II LP"), each a Delaware limited partnership, as UTI Beneficiaries, and
the Grantee, for the purposes of enabling the Grantee in the name of the
Grantor to:
(a) Sign the Grantor's or the Trust's name to any (i) periodic
sales and use or property (real or personal) tax reports, (ii)
periodic renewals of licenses and permits, (iii) periodic renewals of
qualifications to act as a trust or a business trust or (iv) other
periodic governmental filings, registrations, returns or approvals
(collectively, "Filings") arising with respect to or required of the
Grantor or the Trust; and
(b) Identify any surety bonds or other ancillary undertakings
required of the Grantor or the Trust in respect of any Filing, execute
and deliver any and all instruments and take any and all further
action in the name of and on behalf of the Grantor or the Trust as may
be required or deemed desirable to accomplish any and all of the
foregoing and carry out the purposes of this Power of Attorney.
The Grantee is hereby empowered to do any and all lawful acts
necessary or desirable to effect such Filings and the payment of such fees,
costs and taxes as necessary to complete such actions and the Grantor hereby
ratifies and confirms any and all lawful acts that the Grantee shall do
pursuant to and in conformity with this Power of Attorney.
This Power of Attorney is revocable in whole or in part as to the
powers herein granted with respect to the Filings related to one or more
Sub-Trusts (as defined in the Origination Trust Agreement described below) upon
notice by the Grantor. If not earlier revoked, this Power of Attorney shall
expire completely or, if so indicated, in part, upon the earlier of (a) the
termination of that certain second amended and restated trust agreement, dated
as of February 1, 1998 (the "Origination Trust Agreement"), among RTR I LP and
RTR II LP, as grantors and initial beneficiaries, the Grantee, as
Administrative Agent, Delaware Trust Capital Management, Inc., a Delaware
banking corporation, as Delaware trustee, the Grantor, as trustee, and, for
certain limited purposes set forth therein, U.S. Bank National Association, a
B-1
<PAGE> 49
national banking association, as trust agent, and (b) the termination of the
Administration Agreement (completely or with respect to the Administrative
Agent's servicing obligations relating to one or more Sub-Trusts) as each may
be amended, restated or supplemented from time to time. Capitalized terms used
herein that are not otherwise defined shall have the meanings ascribed thereto
in the Origination Trust Agreement.
This Power of Attorney shall be created under and governed and
construed under the internal laws of the State of New York.
The Grantor executes this Power of Attorney with the intent to be
legally bound hereby, and with the intent that such execution shall have the
full dignity afforded by the accompanying witnessing and notarization and all
lesser dignity resulting from the absence of such witnessing and notarization
or any combination thereof.
Dated this ______ day of February, 1998.
[Seal] RTRT, INC.,
as Trustee of Ryder Truck
Rental LT
By:
-----------------------------------
Signed and delivered in the
presence of:
- ----------------------------------
Address:
[Unofficial Witness]
B-2
<PAGE> 1
Exhibit 10.4
===============================================================================
RYDER TRUCK RENTAL LT,
as Origination Trust,
RYDER TRUCK RENTAL I LP
and
RYDER TRUCK RENTAL II LP,
as UTI Beneficiaries,
RYDER TRUCK RENTAL, INC.,
as Administrative Agent,
and
RYDER TRUCK RENTAL, INC.,
as Maintenance Provider
----------------------------------------------
1999-A
ADMINISTRATION SUPPLEMENT
Dated as of October 1, 1999
----------------------------------------------
===============================================================================
<PAGE> 2
TABLE OF CONTENTS
Page
----
ARTICLE TEN
DEFINITIONS
Section 10.01. Definitions................................................... 2
Section 10.02. Interpretative Provisions..................................... 6
ARTICLE ELEVEN
SERVICING OF THE 1999-A LEASES AND THE 1999-A VEHICLES
Section 11.01. Identification of 1999-A Vehicles and 1999-A Leases;
Securitization Value........................................ 7
Section 11.02. Extensions; Administrative Modifications and
Fixed Charge; Term.......................................... 7
Section 11.03. Reallocation and Repurchase of 1999-A Leases and
1999-A Vehicles............................................. 8
Section 11.04. Collections...................................................10
Section 11.05. Net Deposits..................................................12
Section 11.06. Servicing Compensation........................................12
Section 11.07. Advances and Payment Date Advance Reimbursement...............13
Section 11.08. Third Party Claims............................................13
Section 11.09. Contingent and Excess Liability Insurance Policies............14
Section 11.10. Reporting by the Administrative Agent; Delivery of
Certain Documentation.......................................14
Section 11.11. Accountants' Reports..........................................14
Section 11.12. Annual Officer's Certificate..................................14
Section 11.13. Administrative Agent Defaults; Termination of
Administrative Agent........................................15
Section 11.14. Administrative Agent Representations and Warranties...........16
ARTICLE TWELVE
MAINTENANCE OF 1999-A VEHICLES
Section 12.01. Maintenance Provider Default; Termination of
Maintenance Provider........................................17
<PAGE> 3
Page
----
ARTICLE THIRTEEN
MISCELLANEOUS
Section 13.01. Termination of Supplement.....................................18
Section 13.02. Amendment.....................................................18
Section 13.03. Governing Law.................................................18
Section 13.04. Relationship of this Administration Supplement to
Other Trust Documents.......................................18
Section 13.05. Binding Effect................................................19
Section 13.06. Table of Contents and Headings................................19
Section 13.07. Counterparts..................................................19
Section 13.08. Further Assurances............................................19
Section 13.09. Third-Party Beneficiaries.....................................19
Section 13.10. No Waiver; Cumulative Remedies................................19
Section 13.11. No Petition...................................................19
EXHIBITS
Exhibit A - Schedule of 1999-A Vehicles.....................................A-1
<PAGE> 4
1999-A ADMINISTRATION SUPPLEMENT
This 1999-A Administration Supplement, dated as of October 1, 1999, is among
Ryder Truck Rental LT, a Delaware business trust (the "Trust"), Ryder Truck
Rental I LP and Ryder Truck Rental II LP, each a Delaware limited partnership,
as Grantors and initial beneficiaries of the Trust (in such capacities, the
"Grantors" and the "UTI Beneficiaries," respectively), Ryder Truck Rental,
Inc., a Florida corporation ("Ryder"), as administrative agent (in such
capacity, the "Administrative Agent"), and Ryder, as maintenance provider (in
such capacity, the "Maintenance Provider").
RECITALS
WHEREAS, the Grantors and UTI Beneficiaries, the Administrative Agent,
RTRT, Inc., as trustee (the "Trustee") of the Trust, Delaware Trust Capital
Management, Inc., as Delaware trustee, and U.S. Bank National Association, as
trust agent, have entered into that certain second amended and restated trust
agreement, dated as of February 1, 1998 (the "Origination Trust Agreement"),
pursuant to which the purposes of the Trust are, among other things, to take
assignments and conveyances of, and hold in trust and deal, in various Trust
Assets (as such term is defined in the Origination Trust Agreement);
WHEREAS, the parties hereto have entered into that certain
administration agreement, dated as of February 1, 1998 (the "Basic
Administration Agreement" and, as supplemented hereby, the "Administration
Agreement"), which provides for certain servicing obligations with respect to
the Trust Assets; and
WHEREAS, the parties acknowledge that, in connection with the
execution of the supplement to the Origination Trust Agreement, dated as of
October 1, 1999 (the "1999-A SUBI Supplement", and together with the
Origination Trust Agreement, the "SUBI Trust Agreement"), pursuant to which two
special unit of beneficial interest in the Trust (respectively, the "1999-A
Vehicle SUBI" and the "1999-A Lease SUBI", and collectively the "1999-A SUBIs")
will be created, it is necessary and desirable to enter into a supplemental
agreement to the Basic Administration Agreement providing for specific
servicing obligations in connection with the Trust Assets allocable to the
1999-A SUBIs.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
1
<PAGE> 5
ARTICLE TEN
DEFINITIONS
Section 10.01. Definitions. Capitalized terms used herein that are not
otherwise defined shall have the meanings ascribed thereto in the Basic
Administration Agreement or in the SUBI Trust Agreement, as the case may be.
Whenever used in this Administration Supplement, unless the context otherwise
requires, the following words and phrases shall have the following meanings:
"Administration Agreement" has the meaning set forth in the Recitals.
"Administration Fee" means, with respect to the 1999-A SUBI Assets,
the fee payable on each Payment Date equal to, for each related Monthly Period,
one-twelfth of the product of (i) 1.00% and (ii) the aggregate Securitization
Value of all 1999-A Leases as of the first day of such Monthly Period,
calculated and paid based on a 360-day year consisting of twelve 30-day months.
"Administration Supplement" means this supplement to the Basic
Administration Agreement.
"Administrative Agent Letter of Credit" means a letter of credit,
surety bond or insurance policy issued by a depository institution, insurance
company or financial institution having a short-term credit rating at least
equal to the Required Deposit Rating and providing that the Indenture Trustee
or Trust Agent, as the case may be, may draw thereupon in the event the
Administrative Agent satisfies the Monthly Remittance Condition but fails to
deposit SUBI Collections into the 1999-A SUBI Collection Account on a monthly
basis.
"Advance" means a Sales Proceeds Advance or a Financial Component
Advance, as the context may require.
"Available Funds" has the meaning set forth in the Indenture.
"Basic Administration Agreement" has the meaning set forth in the
Recitals.
"Casualty Proceeds" means the sum of Insurance Casualty Proceeds and
Salvage Casualty Proceeds.
"Collection Period" means the three Monthly Periods immediately
preceding the month in which the related Payment Date occurs.
"Contingent and Excess Liability Insurance Policies" means those
certain vehicle liability, excess liability and other Insurance Policies issued
to the Administrative Agent for the benefit of the Administrative Agent, the
Trust, the UTI Beneficiaries, the Transferor or the Issuer from time to time,
to the extent such Insurance Policies relate to the 1999-A Vehicles, providing
coverage in excess of $10 million per accident and permitting multiple claims
in any policy period.
2
<PAGE> 6
"Default Settlement" means, with respect to any Defaulted Vehicle, a
settlement of such default offered by the Administrative Agent to the related
Lessee.
"Deposit Date" means the Business Day immediately preceding the
related Payment Date.
"Excess Casualty Proceeds" means all Salvage Casualty Proceeds
received in excess of the Securitization Value of a Casualty Termination Lease.
"Financial Component Advance" means a Partial Financial Component
Advance or a Full Financial Component Advance, as the context may require.
"Financial Component Payment" means the payment made by a Lessee in
respect of the Financial Component of the related 1999-A Lease.
"Full Financial Component Advance" means, with respect to any Invoiced
Vehicle Group and any Monthly Period, an amount equal to the difference between
the Financial Component due and the Lessee Partial Financial Component Payment.
"Indenture" means that certain indenture, dated as of October 1, 1999,
between the Issuer and the Indenture Trustee.
"Initial Securities Balance" means the initial principal amount of the
Notes and the Trust Certificates.
"Insurance Casualty Proceeds" means all Insurance Proceeds received in
respect of damage to a 1999-A Vehicle relating to a Casualty Termination Lease.
"Invoiced Vehicle Group" means, with respect to a Monthly Period and a
Lessee, one or more groups of Vehicles (which groups may include Vehicles
allocated to one or more Sub-Trusts) the Total Monthly Payments for which are
billed on a single invoice for such Monthly Period.
"Issuer" means the Ryder Vehicle Lease Trust 1999-A.
"Lessee Partial Financial Component Payment" means, in connection with
the payment by a Lessee of less than 100% of the aggregate Total Monthly
Payment due with respect to an Invoiced Vehicle Group, an amount equal to the
product of (i) the amount paid by the Lessee toward such Total Monthly Payments
and (ii) the percentage obtained by dividing the Financial Component due by the
aggregate Total Monthly Payment due, in each case with respect to such Invoiced
Vehicle Group.
"Lessee Vehicles" means all Vehicles (whether allocated to one or more
Sub-Trusts) leased by the related Lessee for the related Monthly Period.
3
<PAGE> 7
"Majority Interest" means, with respect to the holders of Securities,
the holders of a majority of the aggregate principal balance of the related
Securities, except that Securities owned by the Issuer, the Transferor, the
Administrator or any of their respective Affiliates will not be included in
such determination.
"Monthly Remittance Condition" has the meaning set forth in Section
11.04(b).
"1999-A Leases" has the meaning set forth in Section 11.01(a).
"1999-A SUBI" has the meaning set forth in the 1999-A SUBI Supplement.
"1999-A SUBI Supplement" has the meaning set forth in the Recitals.
"1999-A Vehicles" has the meaning set forth in Section 11.01(a).
"99% 1999-A SUBI Certificates" has the meaning set forth in the 1999-A
SUBI Supplement.
"Origination Trust Agreement" has the meaning set forth in the
Recitals.
"Partial Financial Component Advance" means, with respect to any
Invoiced Vehicle Group and any Monthly Period, an amount equal to the
difference between (i) the product of (a) the Financial Component due and (b) a
percentage equal to (1) the amount paid by such Lessee with respect to the
Total Monthly Payment divided by (2) the Fixed Charge due and (ii) the Lessee
Partial Financial Component Payment.
"Payment Date" means the first Business Day after the 14th day of
January, April, July and October of each year, and, if necessary, the Senior
Note Final Payment Date (as defined in the Indenture), commencing with the
first Payment Date on January 17, 2000.
"Payment Date Advance Reimbursement" has the meaning set forth in
Section 11.04(a)(v)(B).
"Rating Event" has the meaning set forth in the Indenture.
"Repurchase Payment" means, with respect to events causing the
Administrative Agent to have an obligation to repurchase a 1999-A Lease and the
related 1999-A Vehicle, the Securitization Value amount due for such repurchase
pursuant to Section 11.03.
"Required Percentage" means the holders of not less than 66K% of the
aggregate outstanding principal balance of the Senior Notes or the Trust
Certificates, as the case may be.
"Residual Value Loss" means, in respect of a Collection Period, the
amount, if any, by which the aggregate net proceeds (excluding any Insurance
Proceeds) from the sale or other disposition of 1999-A Vehicles during such
Collection Period are less than the aggregate Securitization Values of the
related 1999-A Leases.
4
<PAGE> 8
"Residual Value Surplus" means, with respect to any Expired Vehicle,
the amount, if any, by which Sales Proceeds (excluding any Insurance Proceeds)
exceed the Securitization Value of the related 1999-A Lease as of the effective
date of termination of such 1999-A Lease.
"Residual Value Surplus Account" has the meaning set forth in the
1999-A SUBI Supplement.
"Residual Value Surplus Draw Amount" has the meaning set forth in the
Indenture.
"Retained Administration Fee" means, with respect to any Collection
Period, 1% of the Administrative Fee with respect to such Collection Period
representing the portion of the Administrative Fee owed by the Holder of the 1%
1999-A SUBI Certificates.
"Retained Certificate Distribution Amount" means, with respect to any
Collection Period, the sum of (i) 1% of SUBI Collections and (ii) 1% of the
Residual Value Surplus Draw Amount.
"Sales Proceeds" means, with respect to any Expired Vehicle or
Defaulted Vehicle, all proceeds received from the sale or other disposition of
such Expired Vehicle or Defaulted Vehicle (including any applicable Insurance
Proceeds), less all applicable Disposition Expenses, and in the case of an
Expired Vehicle, any outstanding Sales Proceeds Advance.
"Sales Proceeds Advance" means the amount advanced by the
Administrative Agent to the Issuer on a Deposit Date equal to the
Securitization Value of a 1999-A Lease relating to a 1999-A Vehicle that,
during the related Collection Period, became an Expired Vehicle and was not
sold by the Administrative Agent.
"Salvage Casualty Proceeds" means any proceeds received from the sale
of a 1999-A Vehicle related to a Casualty Termination Lease at salvage, net of
any applicable Disposition Expenses.
"Securitization Rate" means, with respect to a 1999-A Lease, an
annualized rate that is calculated as the sum of (i) the weighted average
interest rate on the Securities on the Closing Date, (ii) the Administration
Fee and (iii) 0.50%.
"Securitization Value" means, with respect to any 1999-A Lease, the
value calculated by the Administrative Agent equal to: (i) as of the Cutoff
Date, the Net Book Value of such 1999-A Lease and the related 1999-A Vehicle,
(ii) as of its Maturity Date, the Residual Value of such 1999-A Vehicle and
(iii) as of any other date, the present value, discounted at the Securitization
Rate, of the sum of (a) the aggregate Financial Component of Total Monthly
Payments remaining to be made and (b) the Residual Value of such 1999-A
Vehicle.
"SUBI Collections" means, with respect to any Collection Period, the
net amount collected or received by the Administrative Agent in respect of the
1999-A SUBI Assets during the three Monthly Periods comprising such Collection
Period of: (i) the Financial Component of all Total Monthly Payments; (ii)
Sales Proceeds (excluding Residual Value Surplus), Casualty Proceeds (excluding
Excess Casualty Proceeds) and Termination Proceeds (excluding any Residual
Value Surplus on the Sales Proceeds from the sale of any Expired Vehicle);
5
<PAGE> 9
(iii) Reallocation Payments made by the Administrative Agent; (iv) Termination
Value Payments; (v) any Default Settlement or Termination Settlement paid by an
Obligor to the Administrative Agent and (vi) the Securitization Value payments
from the Administrative Agent's purchase of any 1999-A Vehicle (to the extent
not duplicative of any of clauses (i) through (v) above).
"Termination Settlement" means, with respect to any 1999-A Lease
terminated pursuant to the related Lessee's exercise of the Annual Termination
Option where such 1999-A Lease requires the related Lessee to purchase such
Vehicle for its Termination Value, a settlement offered by the Administrative
Agent to such Lessee to release such Lessee from such requirement.
"Titling Grace Period Vehicles" means 1999-A Vehicles having an
aggregate Cutoff Date Securitization Value not to exceed $_________ that as of
the Closing Date were titled in the name of Ryder but will either (i) be titled
in the name of the Trust or the Trustee on behalf of the Trust during the
Titling Grace Period or (ii) purchased by the Administrative Agent pursuant to
Section 11.03(c).
"Trust Agreement" means that certain trust agreement, as amended and
restated as of October 1, 1999, between the Transferor and the Owner Trustee.
"Trust Certificate" has the meaning set forth in the Trust Agreement.
"Trustee" has the meaning set forth in the Recitals.
"Vehicle Representation Date" means, with respect to any 1999-A
Vehicle, the Cutoff Date.
Section 10.02. Interpretative Provisions. For all purposes of this
Administration Supplement, except as otherwise expressly provided or unless the
context otherwise requires, (i) terms used in this Administration Supplement
include, as appropriate, all genders and the plural as well as the singular,
(ii) references to words such as "herein", "hereof" and the like shall refer to
this Administration Supplement as a whole and not to any particular part,
Article or Section within this Administration Supplement, (iii) references to a
Section such as "Section 11.01" or an Article such as "Article Eleven" shall
refer to the applicable Section or Article of this Administration Supplement,
(iv) the term "include" and all variations thereof shall mean "include without
limitation", (v) the term "or" shall include "and/or" and (vi) the term
"proceeds" shall have the meaning ascribed to such term in the UCC.
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ARTICLE ELEVEN
SERVICING OF THE 1999-A LEASES AND 1999-A VEHICLES
Section 11.01. Identification of 1999-A Vehicles and 1999-A Leases;
Securitization Value.
(a) The Administrative Agent hereby identifies and allocates as 1999-A
SUBI Assets the Vehicles more particularly described on Exhibit A hereto and
the Leases relating to such Vehicles (respectively, the "1999-A Leases and the
"1999-A Vehicles"). Exhibit A shall set forth as to each 1999-A Lease or 1999-A
Vehicle, as the case may be, the (i) vehicle identification number, (ii) date
of origination, (iii) Net Book Value, (iv) Residual Value, (v) Financial
Component, (vi) Fixed Charge and (vii) number of months remaining from the
Cutoff Date to the month in which the Maturity Date occurs.
(b) The Administrative Agent shall calculate a Securitization Value
for each 1999-A Lease. For each 1999-A Lease, (i) the Financial Component of
Total Monthly Payments will equal the constant payment required to amortize the
Net Book Value of such 1999-A Lease and the related 1999-A Vehicle to the
Residual Value of such 1999-A Vehicle over the related Lease Term at the
Securitization Rate and (ii) the Securitization Value at any time will
represent the principal amount of Securities that can be amortized by the sum
of the Financial Component due over the remaining Lease Term, plus the Residual
Value, in each case discounted at the Securitization Rate.
Section 11.02. Extensions; Administrative Modifications and Fixed
Charge; Term.
(a) The Administrative Agent (i) shall not grant an Extension with
respect any 1999-A Leases and (ii) may make one Administrative Modification
with respect to any 1999-A Lease, with each additional Administrative
Modification constituting an Extension for purposes of this Section. In the
event the Administrative Agent makes an Extension, it shall, on the Deposit
Date related to the Collection Period in which the Administrative Agent
discovers or is notified that such Extension was made, (i) deposit or cause to
be deposited into the 1999-A SUBI Collection Account an amount equal to the
Securitization Value of the related 1999-A Lease as of the last day of the
related Collection Period and (ii) direct the Trustee to either reallocate such
1999-A Lease and the related 1999-A Vehicle from the 1999-A SUBIs to the UTI or
cause such 1999-A Lease and 1999-A Vehicle to be conveyed to the Administrative
Agent as described in Section 11.03.
(b) The Administrative Agent shall not exercise its power under any
1999-A Lease to (i) modify the Fixed Charge portion of the Total Monthly
Payment of any 1999-A Lease as in effect as of the Cutoff Date, except when
implementing in the ordinary course of business the inflation indexing
provisions thereof, or (ii) except as set forth in Section 11.02(a), modify the
Lease Term of any 1999-A Lease as in effect as of the Cutoff Date. The
Financial Component of each 1999-A Lease will be established as of the Cutoff
Date and will not change over the Lease Term. In the event the Administrative
Agent modifies the Fixed Charge, the Financial Component or the Lease Term of
any 1999-A Lease in effect as of the Cutoff Date, the Administrative Agent
shall, on the Deposit Date related to the Collection Period in which such
modification occurs, (i) deposit or cause to be deposited into the 1999-A SUBI
Collection Account an amount equal to the Securitization Value of the related
1999-A Lease as of the last day of the related Collection Period and (ii)
direct the Trustee to either reallocate such 1999-A Lease and the related
1999-A Vehicle from the 1999-A SUBIs to the UTI or cause such 1999-A Lease and
1999-A Vehicle to be conveyed to the Administrative Agent as described in
Section 11.03.
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Section 11.03. Reallocation and Repurchase of 1999-A Leases and 1999-A
Vehicles.
(a) The Administrative Agent hereby makes to the other parties hereto
and the parties to the SUBI Trust Agreement the representations and warranties
contained in Section 2.05(a) of the Basic Administration Agreement as to each
1999-A Lease and 1999-A Vehicle as of the Vehicle Representation Date. The
Administrative Agent also hereby represents and warrants that it used no
adverse selection procedures in selecting any of the 1999-A Leases for
inclusion in the 1999-A Lease SUBI and that it is not aware of any bias in the
selection of the 1999-A Leases which would cause delinquencies or losses on the
1999-A Leases to be worse than any other Leases held by the Origination Trust;
provided, however, that the Administrative Agent can make no assurance as to
the actual delinquencies or losses on the 1999-A Leases. For purposes of this
Section, all references in Section 2.05 of the Basic Administration Agreement
to "this Agreement" shall be deemed to be references to the Administration
Agreement as defined herein.
(b) In addition to the requirements set forth in Section 2.05 of the
Basic Administration Agreement, the Administrative Agent shall be required to
purchase a 1999-A Vehicle prior to the Maturity Date of the related 1999-A
Lease and remit to the 1999-A SUBI Collection Account an amount equal to the
Securitization Value of such 1999-A Lease as of the effective date of
termination if: (i) such 1999-A Lease becomes a Casualty Termination Lease,
and, pursuant to such 1999-A Lease, the Administrative Agent is responsible for
paying for the loss or theft of or damage to such 1999-A Vehicle; (ii) the
Administrative Agent (A) re-rates such 1999-A Vehicle for excess mileage and
such change modifies the Residual Value or the Lease Term or (B) invoices the
related Lessee for a material mileage surcharge under such 1999-A Lease for
such 1999-A Vehicle; (iii) at the request of the related Lessee, the
Administrative Agent permits such Lessee to (A) terminate such 1999-A Lease
other than through exercise of the Annual Termination Option or (B) reduce or
delay payments due in respect of the Financial Component of such 1999-A Lease;
(iv) the related Lessee exercises the Annual Termination Option or such 1999-A
Lease becomes a Default Termination Lease and the Administrative Agent (A)
releases such Lessee from any applicable obligation to purchase such 1999-A
Vehicle for its Termination Value (except in connection with a Default
Settlement or a Termination Settlement) or (B) neither demands that such Lessee
so purchase such 1999-A Vehicle nor offers a Termination Settlement or Default
Settlement to such Lessee for such 1999-A Vehicle; or (v) the related Lessee
exercises the Annual Termination Option or such 1999-A Lease becomes a Default
Termination Lease and such 1999-A Lease has been amended to eliminate any
obligation of such Lessee to thereupon purchase such 1999-A Vehicle for its
Termination Value.
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(c) During the Titling Grace Period, the Administrative Agent will
retitle the Titling Grace Period Vehicles in the name of the Trust or the
Trustee on behalf of the Trust. On or prior to the last day of the Titling
Grace Period, the Administrative Agent will provide each Rating Agency and the
Indenture Trustee with a Officer's Certificate of the Administrative Agent as
to the status of the retitling of the Titling Grace Period Vehicles. On the
first Business Day after the end of the Titling Grace Period, the
Administrative Agent will purchase each Titling Grace Period Vehicle not so
retitled during the Titling Grace Period by (i) depositing an amount equal to
the Securitization Value of the related 1999-A Lease as of the last day of the
Titling Grace Period in the 1999-A SUBI Collection Account and (ii) directing
the Trustee to cause such Titling Grace Period Vehicle and the related 1999-A
Lease to be transferred to or upon the order of the Administrative Agent. Such
retitling of the Titling Grace Period Vehicles shall be considered to have been
effected only at such time as the Administrative Agent shall have endorsed and
completed, and delivered to the appropriate state motor vehicle bureau, all
instruments legally required to effect the transfer of title into the name of
the Trust or the Trustee.
(d) The sole remedy of the Trust, the Related Beneficiary and the
Related Holder with respect to events causing the Administrative Agent to
repurchase certain 1999-A Vehicles as provided herein, including but not
limited to the failure of the Administrative Agent to retitle a Titling Grace
Period Vehicle during the Titling Grace Period, shall be to require the
Administrative Agent to make the payment of the Securitization Value, as set
forth herein. The obligation of the Administrative Agent under this Section
shall survive any termination of the Administrative Agent hereunder.
(e) Notwithstanding Section 2.05(g) of the Basic Administration
Agreement, the Administrative Agent may make Special Event Purchases with
respect to 1999-A Vehicles having an initial Securitization Value of no more
than (i) 5% of the Initial Securities Balance in any calendar year or (ii) 10%
of the Initial Securities Balance in the aggregate.
(f) In connection with the purchase by the Administrative Agent of an
Expired Vehicle pursuant to Section 2.05(f) of the Basic Administration
Agreement, with respect to the related 1999-A Lease, in the event that (i) no
Sales Proceeds Advance has been made, the purchase price of such Expired
Vehicle will equal the Securitization Value of such 1999-A Lease as of the date
of expiration and (ii) a Sales Proceeds Advance has been made, no additional
amounts need be remitted by the Administrative Agent; provided, however, that
the Administrative Agent shall relinquish all rights to reimbursement of any
such Sales Proceeds Advance.
(g) In the event any 1999-A Lease and the related 1999-A Vehicle are
reallocated to the UTI, until such time thereafter, if ever, as such Lease and
Vehicle are allocated to an Other SUBI, the Administrative Agent shall
indemnify, defend and hold harmless the original Beneficiaries from and against
any and all loss or liability with respect to or resulting from such Lease or
Vehicle (including the reasonable fees and expenses of counsel).
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Section 11.04. Collections.
(a) The Administrative Agent shall, with respect to SUBI Collections
and amounts in respect of the 1999-A SUBI Certificates, from time to time,
determine the respective amounts and recipients and:
(i) during each Collection Period, in addition to the deposits
required by Section 2.06 of the Basic Administration Agreement,
deposit in the 1999-A SUBI Collection Account those amounts specified
in Section 11.02 and all Reallocation Payments and Repurchase Payments
pursuant to Section 11.03;
(ii) on, or prior to each Deposit Date, deposit in the 1999-A
SUBI Collection Account, all Advances, any Residual Value Surplus from
the sale of an Expired Vehicle for which the Administrative Agent made
a Sales Proceeds Advance, any Sales Proceeds from the disposition of
an Expired Vehicle at auction for which the Administrative Agent was
reimbursed during the related Collection Period pursuant to Section
11.07 and all Excess Casualty Proceeds, if any, for any 1999-A Lease
which became a Casualty Termination Lease during the related
Collection Period;
(iii) on each Deposit Date, instruct the Trustee (acting through
the Trust Agent) to transfer the amount of Residual Value Surplus, if
any, reflected in the Payment Date Certificate for each Expired
Vehicle which was a 1999-A Vehicle sold or otherwise disposed of
during the related Collection Period, from the 1999-A SUBI Collection
Account to the Residual Value Surplus Account;
(iv) on each Deposit Date, instruct the Trustee (acting through
the Trust Agent) to transfer to the 1999-A SUBI Collection Account,
prior to 5:00 p.m., New York City time, an amount equal to the
Residual Value Surplus Draw Amount, if any, reflected in the Payment
Date Certificate, from the Residual Value Surplus Account;
(v) on each Payment Date, pursuant to the Payment Date
Certificate, allocate (i) Available Funds and (ii) the Retained
Certificate Distribution Amount on deposit in the 1999-A SUBI
Collection Account with respect to the related Collection Period and
instruct the Trustee (acting through the Trust Agent) to make, no
later than 11:00 a.m., New York City time, the following deposits and
distributions in the following amounts and order of priority:
(A) to an account specified by the Holder of the 1% 1999-A
SUBI Certificate, the excess of (i) the Retained Certificate
Distribution Amount over (ii) the Retained Administration Fee;
(B) upon presentation of an Officer's Certificate of the
Administrative Agent setting forth the basis for the
determination of the amount to be transferred, to the
Administrative Agent the sum of the following amounts
(collectively, the "Payment Date Advance Reimbursement"):
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(1) any outstanding Sales Proceeds Advances which
have been outstanding as of the end of the related
Collection Period for at least 270 days; and
(2) any outstanding Financial Component Advances
from (x) subsequent payments made by the related Lessee in
respect of the Total Monthly Payment due with respect to
the related Lessee Vehicles or (y) if the Lessee failed to
pay the entire Total Monthly Payment within at least 180
days after the date of billing as of the end of the
related Collection Period;
(C) to or on behalf of the Administrative Agent, the
Administration Fee in respect of the related Collection Period,
together with any unpaid Administration Fees in respect of one or
more prior Collection Periods; and
(D) to the Note Distribution Account, the Reserve Fund and
Certificate Distribution Account, such distributions in the
amounts and order of priority as set forth in Sections 8.04(a)
and 10.01 of the Indenture;
(vi) on each Payment Date, instruct the Trustee (acting through
the Trust Agent), in writing to transfer all net investment earnings
on each of the 1999-A SUBI Collection Account and the Residual Value
Surplus Account to the Reserve Fund;
(vii) on each Payment Date, after all distributions required to
be made on such Payment Date have been made, instruct the Trustee
(acting through the Trust Agent), in writing to make the following
distributions from the Residual Value Surplus Account:
(A) to or on behalf of the Administrative Agent to the
extent not otherwise covered by Sales Proceeds or Termination
Proceeds, any Disposition Expenses relating to 1999-A Vehicles
sold by the Administrative Agent pursuant to the Administration
Agreement during the related Collection Period, together with any
such unreimbursed expenses or Advances incurred in one or more
prior Collection Periods; and
(B) to the Transferor, any remaining amounts on deposit in
the Residual Value Surplus Account.
(b) Notwithstanding Section 2.06 of the Basic Administration
Agreement, the Administrative Agent shall be permitted to retain the amounts
provided for in such Section received during a Monthly Period until the second
day following such Monthly Period, for so long as the following requirements
are met (collectively, the "Monthly Remittance Condition"):
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(i) (A) Ryder (or its successors pursuant to Section 2.13(b) of
the Basic Administration Agreement) is the Administrative Agent, (B)
Ryder's short-term debt is rated in the highest rating category by, or
is otherwise acceptable to, each Rating Agency and (C) no
Administrative Agent Default has occurred; or
(ii) if (A) the Administrative Agent obtains an Administrative
Agent Letter of Credit under which demands for payment may be made to
secure timely remittance of monthly SUBI Collections to the 1999-A
SUBI Collection Account and (B) the Trustee, the Indenture Trustee and
the Owner Trustee are provided with confirmation from each Rating
Agency to the effect that the use of an alternative remittance
schedule will not result in a Rating Event.
Pending deposit into the 1999-A SUBI Collection Account, SUBI Collections
(other than the Maintenance Component of Total Monthly Payments) may be
employed by the Administrative Agent at its own risk and for its own benefit
and shall not be segregated from its own funds.
(c) If, with respect to an Invoiced Vehicle Group, the related Lessee
pays (i) the Total Monthly Payment, the Administrative Agent shall deposit from
such payment into the 1999-A SUBI Collection Account the Financial Component
related to such Invoiced Vehicle Group and (ii) less than the Total Monthly
Payment due, the Administrative Agent shall deposit from such payment into the
1999-A SUBI Collection Account an amount equal to the Lessee Partial Financial
Component Payment.
(d) Payments on the 1999-A Leases shall be allocated pro rata using
the Financial Component and the Maintenance Component thereof. During each
Collection Period, all payments in respect of the Maintenance Component either
will not be deposited into the related Collection Account or will be withdrawn
daily therefrom; and in each case, all such payments shall be paid to or
retained by the Maintenance Provider.
Section 11.05. Net Deposits. Notwithstanding anything to the contrary
contained in this Administration Supplement, for so long as Ryder is the
Administrative Agent, the Administrative Agent shall be permitted to deposit
into the 1999-A SUBI Collection Account only the net amount distributable to
the Issuer, as holder of the 99% 1999-A Vehicle SUBI Certificate and pledgee of
the 99% 1999-A Lease SUBI Certificate, on the related Deposit Date. The
Administrative Agent shall, however, account to the Issuer, the Trustee, the
Trustee Agent, the Indenture Trustee (or any successor to the duties of the
Indenture Trustee), the Owner Trustee and the holders of Rated Securities as if
all of the deposits and distributions described herein were made individually.
Section 11.06. Servicing Compensation.
(a) As compensation for the performance of its obligations under this
Administration Supplement, the Administrative Agent shall be entitled to
receive the Administration Fee with respect to the 1999-A SUBI Assets.
(b) The Administrative Agent shall also be entitled to additional
servicing compensation with respect to the 1999-A SUBI Assets in the form of,
among other things, expense reimbursement and any other administrative fees or
similar charges under the 1999-A Leases, including but not limited to any late
payment fees now or later in effect.
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Section 11.07. Advances and Payment Date Advance Reimbursement.
(a) If a Lessee's actual payments with respect to an Invoiced Vehicle
Group are less than the Total Monthly Payments due with respect thereto during
a Collection Period, and are (i) greater than or equal to the Fixed Charge for
such Invoiced Vehicle Group, the Administrative Agent shall make a Full
Financial Component Advance or (ii) less than the Fixed Charge for such
Invoiced Vehicle Group, the Administrative Agent shall make a Partial Financial
Component Advance, in each case on or before the related Deposit Date, unless,
pursuant to Section 11.07(c), such Advance is not required to be made.
(b) On each Deposit Date, the Administrative Agent shall make, by
deposit into the 1999-A SUBI Collection Account, Sales Proceeds Advances. After
the Administrative Agent has made a Sales Proceeds Advance with respect to an
Expired Vehicle, the Issuer shall have no claim against or interest in such
Expired Vehicle or any Sales Proceeds resulting from the sale or other
disposition thereof, except with respect to any related Residual Value Surplus.
If the Administrative Agent shall sell or otherwise dispose of an Expired
Vehicle after having made a Sales Proceeds Advance, the Issuer may retain all
of such Sales Proceeds Advance, and the Administrative Agent shall retain the
related Sales Proceeds up to the Securitization Value of the related 1999-A
Lease, and shall deposit the Residual Value Surplus, if any, into the 1999-A
SUBI Collection Account. If the Sales Proceeds are less than the Securitization
Value of the related 1999-A Lease, the Administrative Agent may deduct the
difference from SUBI Collections in respect of one or more future Collection
Periods. If the Administrative Agent has not sold an Expired Vehicle within 270
days after it has made a Sales Proceeds Advance, it shall be reimbursed for
such Sales Proceeds Advance from the 1999-A SUBI Collection Account. Within six
months of receiving such reimbursement, if the related 1999-A Vehicle has not
been sold, the Administrative Agent shall cause such 1999-A Vehicle to be sold
at auction and shall remit the proceeds associated with such auction sale to
the 1999-A SUBI Collection Account.
(c) Notwithstanding anything to the contrary in the Administration
Agreement, the Administrative Agent shall be required to make Advances only to
the extent that it determines that such Advance will be recoverable from future
payments on or in respect of the related 1999-A Lease or 1999-A Vehicle.
Section 11.08. Third Party Claims. In addition to the requirements set
forth in Section 2.08 of the Basic Administration Agreement, the Administrative
Agent shall immediately notify the Transferor (in the event that Ryder is not
acting as Administrative Agent) and the Indenture Trustee (or any successor to
the duties of the Indenture Trustee) upon learning of a claim or Lien of
whatever kind of a third party that would materially and adversely affect the
interests of the Transferor or the Trust with respect to the 1999-A SUBI
Assets.
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Section 11.09. Contingent and Excess Liability Insurance Policies. So
long as any Securities are outstanding, the Administrative Agent shall maintain
and pay when due all premiums with respect to, and the Administrative Agent may
not terminate or cause the termination of, the Contingent and Excess Liability
Insurance Policies unless (i) a replacement Insurance Policy is obtained that
provides coverage against third party claims that may be raised against the
Trust or the Trustee on behalf of the Trust with respect to any 1999-A Vehicle
in an amount at least equal to $10 million per claim (which Insurance Policy
may be a blanket Insurance Policy covering the Administrative Agent and one or
more of its Affiliates) and (ii) in the case of Rated Securities, each Rating
Agency has delivered a letter to the holders of the Rated Securities to the
effect that such termination or any replacement insurance would not result in a
Rating Event. The obligations of the Administrative Agent pursuant to this
Section shall survive any termination of the Administrative Agent's other
obligations under the Administration Agreement until such time as claims can no
longer be brought that would be covered by such Insurance Policies, whether as
a result of the expiration of relevant statutes of limitations or otherwise.
Section 11.10. Reporting by the Administrative Agent; Delivery of
Certain Documentation.
(a) On or prior to the Closing Date, and periodically thereafter as
required in order to update the contents thereof upon any changes in the
matters certified therein, the Administrative Agent shall furnish to the
Trustee and the Related Beneficiary an Officer's Certificate listing the
officers of the Administrative Agent involved in, or responsible for, the
servicing of the 1999-A Leases.
(b) On or before each Determination Date, the Administrative Agent
shall, in addition to the information required in Section 4.01(c) of the Basic
Administration Agreement, to the extent that reimbursement is being requested
pursuant to such Section, include in the Officer's Certificate provided for in
such Section the amount of any transfer during the related Collection Period
from the Residual Value Surplus Account to the 1999-A SUBI Collection Account.
Section 11.11. Accountants' Reports. On or before April 30 of each
year, commencing with April 30, 2000 the Administrative Agent shall deliver or
cause to be delivered to the Issuer, the Indenture Trustee, each Rating Agency
and the Owner Trustee a report, prepared by the Independent Accountants of the
Administrative Agent, stating that such Independent Accountants have examined
the financial statements of the Administrative Agent (which may be financial
statements of its parent) for the preceding 12 months ended December 31 (or
such shorter period in the case of the first such report) in accordance with
generally accepted auditing standards, which examination included such tests of
the accounting records and such other auditing procedures as they considered
necessary in the circumstances, and that nothing came to the attention of such
Independent Accountants that caused them to believe that the servicing of such
1999-A Leases was not being conducted, or that distributions on the Rated
Securities were not being made, in each case in accordance with this Agreement,
except for such exceptions as such firm shall believe to be immaterial and such
other exceptions as shall be set forth in such statement.
Section 11.12. Annual Officer's Certificate. On or before April 30 of
each year, commencing April 30, 2000 the Administrative Agent shall deliver an
Officer's Certificate to the Issuer, the Indenture Trustee, each Rating Agency
and the Owner Trustee to the effect that a review of the activities of the
Administrative Agent during the preceding 12 months ended December 31 (or such
shorter period in the case of the first such Officer's Certificate) has been
made under the supervision of the officer executing such Officer's Certificate
with a view to determining whether during such period an Administrative Agent
Default has occurred, and (i) stating that, to the best knowledge of such
officer, no such Administrative Agent Default has occurred under the
Administration Agreement or (ii) if such a default has occurred, specifying
such default and the nature and status thereof.
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Section 11.13. Administrative Agent Defaults; Termination of
Administrative Agent.
(a) In addition to the provisions of Section 5.01(a) of the Basic
Administration Agreement, any of the following acts or occurrences shall
constitute an Administrative Agent Default under the Administration Agreement:
(i) the Administrative Agent shall fail to maintain or pay when
due the premium in respect of any Contingent and Excess Liability
Insurance Policy, which failure continues for ten Business Days after
discovery of such failure by an officer of the Administrative Agent or
receipt by the Administrative Agent of written notice thereof by the
Trustee or a Holder;
(ii) the Administrative Agent shall fail to deliver to the
Indenture Trustee (or any successor to the duties of the Indenture
Trustee) any report required to be delivered to the Indenture Trustee
or the Issuer pursuant to the Basic Documents to which the
Administrative Agent is a party, which failure continues for 30
Business Days after discovery of such failure by an officer of the
Administrative Agent or receipt by the Administrative Agent of written
notice thereof by the Indenture Trustee; or
(iii) the Administrative Agent shall fail to cause the delivery
to the Indenture Trustee for distribution to the Noteholders or to the
Owner Trustee for distribution to the Certificateholders any required
payment or fail to deliver to the Trustee (acting through the Trust
Agent) for distribution to the Indenture Trustee and the Owner Trustee
any required payment, which failure continues for five Business Days
after discovery of such failure by an officer of the Administrative
Agent or receipt by the Administrative Agent of notice thereof from
the Indenture Trustee, the Owner Trustee or holders of Securities
evidencing not less than 25% of the aggregate unpaid principal balance
of the Securities, voting together as a single class;
provided, however, that any such failure with respect to the 1999-A SUBIs shall
be an Administrative Agent Default only with respect to such 1999-A SUBIs and
not with respect to any other Sub-Trust.
(b) Upon the occurrence of any Administrative Agent Default under the
Administration Agreement, in addition to the requirements set forth in Section
5.01(b) of the Basic Administration Agreement, the Administrative Agent shall
provide to the Indenture Trustee, the Owner Trustee, and any holders of Rated
Securities, prompt notice of such failure or delay by it, together with a
description of its efforts to so perform its obligations.
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(c) In addition to the provisions of Section 5.01(c) of the Basic
Administration Agreement, if an Administrative Agent Default shall have
occurred and be continuing with respect to the 1999-A SUBIs, the Trustee on
behalf of the Trust shall, at the direction of the Required Related Holders, by
notice given to the Administrative Agent, each Rating Agency, the Related
Beneficiary and the holders of the Rated Securities, terminate the rights and
obligations of the Administrative Agent under this Administration Supplement in
accordance with such Section. In the event the Administrative Agent is removed
as administrative agent with respect to servicing the 1999-A SUBI Assets,
subject to the consent of the Trustee, the Required Related Holders shall
appoint a successor administrative agent. The successor Administrative Agent
shall accept its appointment by a written assumption in a form acceptable to
the Trustee. Such successor Administrative Agent shall be approved by the
Trustee, such approval not to be unreasonably withheld. With respect to any
Administrative Agent Default related to the 1999-A SUBI Assets, the Trustee,
acting on the direction of the Required Related Holders may waive any default
of the Administrative Agent. For purposes of this Section, so long as the Lien
of the Indenture is in place, the Required Related Holders shall be deemed to
be the Indenture Trustee (as Registered Pledgee of the 1999-A SUBI
Certificates), acting at the direction of the Required Percentage of the Senior
Noteholders and thereafter, the Owner Trustee, acting at the direction of the
Required Percentage of the Trust Certificateholders until the Aggregate
Certificate Balance has been reduced to zero.
(d) In the event the Administrative Agent is removed with respect to
servicing the 1999-A SUBI Assets, the Administrative Agent shall be entitled to
reimbursement for any outstanding Advances made pursuant to this Supplement, to
the extent of the funds available therefore with respect to all Advances made
by the Administrative Agent.
Section 11.14. Administrative Agent Representations and Warranties.
Effective as of the date hereof, the Administrative Agent hereby reaffirms the
representations and warranties set forth in Section 7.01 of the Basic
Administration Agreement. For purposes of this Section, references in Section
7.01 of the Basic Administration Agreement to "this Agreement" shall be deemed
to refer to the Administration Agreement as defined herein.
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ARTICLE TWELVE
MAINTENANCE OF 1999-A VEHICLES
Section 12.01. Maintenance Provider Default; Termination of
Maintenance Provider.
(a) Upon the occurrence of any Maintenance Provider Default under the
Administration Agreement, in addition to the requirements set forth in Section
6.01(b) of the Basic Administration Agreement, the Administrative Agent shall
provide to the Indenture Trustee, the Owner Trustee, and any holders of Rated
Securities, prompt notice of such failure or delay by the Maintenance Provider,
together with a description of the Maintenance Provider's efforts to so perform
its obligations.
(b) In addition to the provisions of Section 6.01(c) of the Basic
Administration Agreement, if a Maintenance Provider Default shall have occurred
and be continuing with respect to a 1999-A SUBI, the Trustee on behalf of the
Trust shall, at the direction of the Required Related Holders, by notice given
to the Administrative Agent, each Rating Agency, the Related Beneficiary and
the holders of the Rated Securities, terminate the rights and obligations of
the Maintenance Provider under this Administration Supplement in accordance
with such Section. In the event the Maintenance Provider is removed as
maintenance provider with respect to servicing the 1999-A SUBI Assets, subject
to the consent of the Trustee, the Required Related Holders shall appoint a
successor maintenance provider. The successor Maintenance Provider shall accept
its appointment by a written assumption in a form acceptable to the Trustee.
Such successor Maintenance Provider shall be approved by the Trustee, such
approval not to be unreasonably withheld. With respect to any Maintenance
Provider Default related to the 1999-A SUBI Assets, the Trustee, acting on the
direction of the Required Related Holders may waive any default of the
Maintenance Provider. For purposes of this Section, so long as the Lien of the
Indenture is in place, the Required Related Holders shall be deemed to be the
Indenture Trustee (as Registered Pledgee of the 1999-A SUBI Certificates)
acting at the direction of the Required Percentage of the Senior Noteholders
and thereafter, the Owner Trustee, acting at the direction of the Required
Percentage of the Trust Certificateholders until the Aggregate Certificate
Balance has been reduced to zero.
17
<PAGE> 21
ARTICLE THIRTEEN
MISCELLANEOUS
Section 13.01. Termination of Supplement. This Administration
Supplement shall terminate upon the earlier to occur of (i) the termination of
the 1999-A SUBIs or (ii) the resignation or removal of the Administrative Agent
with respect to the 1999-A SUBIs in accordance with the terms of the
Administration Agreement. Any such termination hereunder shall effect a
termination only with respect to the 1999-A SUBI Assets and not as to Trust
Assets allocated to any other Sub-Trust, and shall not effect a termination of
the Basic Administration Agreement or any other Administration Supplement.
Section 13.02. Amendment. Notwithstanding the foregoing, this
Administration Supplement (and, accordingly, the Basic Administration
Agreement, insofar as it relates to the 1999-A SUBIs) may be amended from time
to time by the parties hereto (including to change the manner in which the
Residual Value Surplus Account is funded, including the elimination of the
Residual Value Surplus Account, or to change the remittance schedule for
depositing SUBI Collections and other amounts into the 1999-A SUBI Collection
Account) (i) upon confirmation from each Rating Agency to the effect that such
amendment would not cause a Rating Event or (ii) upon receipt of the consent of
holders of Rated Securities affected thereby holding not less than a Majority
Interest, for the purpose of adding any provisions to, changing in any manner
or eliminating any of the provisions of this Administration Supplement or
modifying in any manner the rights of the holders of Rated Securities;
provided, however, that (A)(1) no such amendment shall increase or reduce in
any manner the amount of, or accelerate or delay the timing of, collections or
payments in respect of the 1999-A SUBIs or the 99% 1999-A SUBI Certificates or
distributions (or the interest rate thereon) required to be made on any Rated
Securities and (2) no amendment of any type shall reduce the percentage of the
aggregate principal amount of Rated Securities required to consent to any such
amendment, in each case without the consent of all the holders or 100% of all
outstanding Rated Securities, as the case may be, and (B) an Opinion of Counsel
is delivered to the effect that, in addition to the information required by
Section 8.02(b)(ii) of the Basic Administration Agreement, after such
amendment, the Trust Certificates will properly be characterized as
indebtedness that is secured by the assets of the Trust.
Section 13.03. Governing Law. This Administration Supplement shall be
governed by and construed in accordance with the internal laws of the State of
New York without regard to any otherwise applicable principles of conflicts of
laws (other than Section 5-1401 of the New York General Obligations Law).
Section 13.04. Relationship of this Administration Supplement to Other
Trust Documents. Unless the context otherwise requires, this Administration
Supplement and the other Trust Documents shall be interpreted so as to give
full effect to all provisions hereof and thereof. In the event of any actual
conflict between the provisions of this Administration Supplement and (i) the
Origination Trust Agreement, with respect to the servicing of any Trust Assets,
the provisions of this Administration Supplement shall prevail and (ii) the
Basic Administration Agreement, the provisions of this Administration
Supplement shall control.
18
<PAGE> 22
Section 13.05. Binding Effect. The provisions of this Administration
Supplement shall be binding upon and inure to the benefit of the parties hereto
and their permitted successors and assigns, and all such provisions shall inure
to the benefit of the Trustee on behalf of the Trust.
Section 13.06. Table of Contents and Headings. The Table of Contents
and Article and Section headings herein are for convenience of reference only
and shall not define or limit any of the terms or provisions hereof.
Section 13.07. Counterparts. This Administration Supplement may be
executed in any number of counterparts, each of which so executed and delivered
shall be deemed to be an original, but all of which counterparts shall together
constitute but one and the same instrument.
Section 13.08. Further Assurances. Each party will do such acts, and
execute and deliver to any other party such additional documents or
instruments, as may be reasonably requested in order to effect the purposes of
this Administration Supplement and to better assure and confirm unto the
requesting party its rights, powers and remedies hereunder.
Section 13.09. Third-Party Beneficiaries. The Issuer, each holder or
registered pledgee of the 1999-A SUBIs and each Related Beneficiary shall be
third-party beneficiaries of the Administration Agreement. Except as otherwise
provided in the Administration Agreement, no other Person shall have any rights
hereunder.
Section 13.10. No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of any party hereto, any right, remedy,
power or privilege hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights, remedies, powers and privileges
herein provided are cumulative and not exhaustive of any rights, remedies,
powers and privileges provided at law, in equity or otherwise.
Section 13.11. No Petition. The Administrative Agent and the
Maintenance Provider, by entering into this Agreement, in addition to
provisions of Section 8.14 of the Basic Administration Agreement, hereby
covenant and agree that they will not institute, or join in instituting, any
bankruptcy, reorganization, arrangement, insolvency or liquidation Proceeding,
or other Proceeding under federal or state bankruptcy or similar laws for a
period of one year and a day after payment in full of the Securities, against
the Transferor or the Issuer; provided, however, that 100% of the Senior
Noteholders, or, if no Senior Notes are then outstanding, the Subordinated
Noteholder, or, if no Subordinated Notes are then outstanding, 100% of the
Trust Certificateholders (in each case excluding the Transferor and any of its
Affiliates) may at any time institute or join in instituting any bankruptcy,
reorganization, insolvency or liquidation proceeding against the Transferor or
the Issuer.
19
<PAGE> 23
IN WITNESS WHEREOF, the parties hereto have caused this Administration
Supplement to be duly executed by their respective officers duly authorized as
of the day and year first above written.
RYDER TRUCK RENTAL LT
By: RTRT, INC.,
as Trustee
By:
--------------------------------------
Name:
Title:
RYDER TRUCK RENTAL I LP,
as UTI Beneficiary
By: RYDER TRUCK RENTAL I LLC,
as General Partner
By: RTR LEASING I, INC.,
as Manager
By:
--------------------------------------
Name:
Title:
RYDER TRUCK RENTAL II LP,
as UTI Beneficiary
By: RYDER TRUCK RENTAL II LLC,
as General Partner
By: RTR LEASING I, INC.,
as Manager
By:
--------------------------------------
Name:
Title:
20
<PAGE> 24
RYDER TRUCK RENTAL, INC.,
as Administrative Agent
By:
-----------------------------------
Name:
Title:
RYDER TRUCK RENTAL, INC.,
as Maintenance Provider
By:
-----------------------------------
Name:
Title:
21
<PAGE> 25
EXHIBIT A
SCHEDULE OF 1999-A VEHICLES
[Omitted. Copies on file with the Administrative Agent, the Trustee
and the Owner Trustee.]
A-1
<PAGE> 1
EXHIBIT 10.5
================================================================================
RYDER TRUCK RENTAL I LP,
as Transferor,
and
RYDER FUNDING LP,
as Transferee
-----------------------------------
SUBI CERTIFICATE TRANSFER AGREEMENT
Dated as of October 1, 1999
-----------------------------------
================================================================================
<PAGE> 2
SUBI CERTIFICATE TRANSFER AGREEMENT
This SUBI Certificate Transfer Agreement, dated as of October 1, 1999
(the "Agreement"), is between Ryder Truck Rental I LP, a Delaware limited
partnership, as transferor (the "Transferor"), and Ryder Funding LP, a Delaware
limited partnership, as transferee (the "Transferee").
RECITALS
WHEREAS, the Transferor and Ryder Truck Rental II LP ("RTR II LP"), as
Grantors and UTI Beneficiaries, Ryder Truck Rental, Inc., as Administrative
Agent, Delaware Trust Capital Management, Inc., as Delaware Trustee, RTRT, Inc.,
as Trustee and U.S. Bank National Association, as Trust Agent, have entered into
that certain second amended and restated trust agreement, dated as of February
1, 1998 (the "Origination Trust Agreement"), pursuant to which Ryder Truck
Rental LT, a Delaware business trust (the "Trust"), will take assignments and
conveyances of and hold in trust various assets (the "Trust Assets");
WHEREAS, the parties to the Origination Trust Agreement supplemented
the Origination Trust Agreement with a supplement, dated as of October 1, 1999
(together with the Origination Trust Agreement, the "SUBI Trust Agreement"), to
establish two special units of beneficial interest, the "1999-A Lease SUBI" and
the "1999-A Vehicle SUBI" (each, a "1999-A SUBI");
WHEREAS, in connection with the SUBI Trust Agreement a separate
portfolio of leases (the "1999-A Leases") and certain other related assets of
the Trust will be allocated to the 1999-A Lease SUBI, and the vehicles that are
leased under the 1999-A Leases (the "1999-A Vehicles") and certain other related
assets of the Trust will be allocated to the 1999-A Vehicle SUBI;
WHEREAS, the Trust has created certificates evidencing a 99% beneficial
interest and a 1% beneficial interest in each 1999-A SUBI (respectively, the
"99% 1999-A SUBI Certificates" and the "1% 1999-A SUBI Certificates") and has
issued the 99% 1999-A SUBI Certificates to the Transferor and the 1% 1999-A SUBI
Certificates to Ryder Truck Rental II LP;
WHEREAS, the Transferor and the Transferee desire to enter into this
Agreement to provide for the sale by the Transferor to the Transferee, without
recourse, of all of the Transferor's right, title and interest in and to the 99%
1999-A SUBI Certificates and the interest in the 1999-A SUBIs represented
thereby; and
WHEREAS, directly after the sale of the 99% 1999-A SUBI Certificates to
the Transferee, the Transferee shall sell, transfer and assign all of its right
to the 99% 1999-A Vehicle SUBI Certificate to the Ryder Vehicle Lease Trust
1999-A in connection with a securitization.
NOW, THEREFORE, in consideration of the promises and the mutual
covenants herein contained, the parties hereto agree as follows:
1
<PAGE> 3
ARTICLE ONE
DEFINITIONS
Section 1.01. DEFINITIONS. Capitalized terms used herein that are not
otherwise defined shall have the meanings ascribed thereto in the SUBI Trust
Agreement.
Section 1.02. INTERPRETIVE PROVISIONS. For all purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires, (i) terms used in this Agreement include, as appropriate,
all genders and the plural as well as the singular, (ii) references to words
such as "herein", "hereof" and the like shall refer to this Agreement as a whole
and not to any particular part, Article or Section within this Agreement, (iii)
the term "include" and all variations thereof shall mean "include without
limitation", (iv) the term "or" shall include "and/or" and (v) the term
"proceeds" shall have the meaning ascribed thereto in the UCC.
ARTICLE TWO
TRANSFER OF 99% 1999-A SUBI CERTIFICATES
Section 2.01. TRANSFER OF 99% 1999-A SUBI CERTIFICATES.
(a) In consideration of the Transferee's delivery to, or upon the order
of, the Transferor of cash in the amount of $___________ (the "Transfer Price"),
the Transferor does hereby absolutely sell, transfer, assign and otherwise
convey to the Transferee, without recourse, and the Transferee does hereby
purchase and acquire, as of the date set forth above, all of the following
(collectively, the "Assets"):
(i) all right, title and interest in and to the 99% 1999-A
Vehicle SUBI Certificate and 99% 1999-A Lease SUBI Certificate and the
respective interests in the 1999-A Vehicle SUBI and 1999-A Lease SUBI
represented thereby, including all monies due and paid thereon or in
respect thereof;
(ii) the right to realize upon any property that underlies
or may be deemed to secure the respective interests in the 1999-A
Vehicle SUBI and the 1999-A Lease SUBI represented by the 99% 1999-A
Vehicle SUBI Certificate and the 99% 1999-A Lease SUBI Certificate;
(iii) all of the Transferor's rights and benefits, as
Holder of each 99% 1999-A SUBI Certificate under the Administration
Agreement and the SUBI Trust Agreement; and
(iv) all proceeds of the foregoing.
(b) The parties hereto intend that the sale, transfer and assignment of
the Assets constitute a true sale and assignment of the Assets such that any
interest in and title to the Assets
2
<PAGE> 4
would not be property of the Transferor's estate in the event the Transferor
becomes a debtor in a case under any bankruptcy law. To the extent that the
conveyance of the Assets hereunder is characterized by a court or similar
governmental authority as a financing, it is intended by the Transferor and the
Transferee that the interest conveyed constitute a first priority grant of a
perfected security interest under the UCC as in effect in the State of New York
by the Transferor to the Transferee to secure the Transfer Price to the
Transferor. The Transferor does hereby grant to the Transferee a security
interest in all of its rights, title and privileges and interest in and to the
Assets and the parties hereto agree that this Agreement constitutes a "security
agreement" under all applicable law.
Section 2.02. REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR AND THE
TRANSFEREE.
(a) The Transferor hereby represents and warrants to the Transferee as
of the date of this Agreement and the Closing Date that:
(i) ORGANIZATION AND GOOD STANDING. The Transferor is a
limited partnership duly formed, validly existing and in good standing
under the laws of the State of Delaware, and has 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 shall have, power, authority and legal right to
acquire, own and sell the Assets.
(ii) DUE QUALIFICATION. The Transferor is duly qualified
to do business as a foreign limited partnership 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, except where the failure to
have any such license, approval or qualification would not have a
material adverse effect on the condition, financial or otherwise, of
the Transferor or would not have a material adverse effect on the
ability of the Transferor to perform its obligations under this
Agreement.
(iii) POWER AND AUTHORITY. The Transferor shall have the
power and authority to execute and deliver this Agreement and to carry
out its terms; and the execution, delivery and performance of this
Agreement shall have been duly authorized by the Transferor by all
necessary corporate action.
(iv) BINDING OBLIGATION. This Agreement constitutes a
legal, valid and binding obligation of the Transferor, enforceable
against it in accordance with its terms, except as enforceability may
be subject to or limited by bankruptcy, insolvency, reorganization,
moratorium, liquidation or other similar laws affecting the enforcement
of creditors' rights in general and by general principles of equity,
regardless of whether such enforceability shall be considered in a
proceeding in equity or at law.
(v) NO VIOLATION. The execution, delivery and performance
by the Transferor of this Agreement and the consummation of the
transactions contemplated by this Agreement and the fulfillment of the
terms hereof shall not conflict with, result in any breach of any of
the terms and provisions of, nor constitute (with or without notice or
3
<PAGE> 5
lapse of time) a default under, the limited partnership agreement of
the Transferor, or conflict with or breach any of the material terms or
provisions of, or constitute (with or without notice or lapse of time)
a default under, any indenture, agreement or other instrument to which
the Transferor is a party or by which it may be bound or any of its
properties are subject; nor result in the creation or imposition of any
lien upon any of its properties pursuant to the terms of any material
indenture, agreement or other instrument (other than this Agreement);
nor violate any law or, to the knowledge of the Transferor, any order,
rule or regulation applicable to it or its properties of any court or
of any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Transferor or
any of its properties.
(vi) NO PROCEEDINGS. There are no proceedings or
investigations pending or, to the knowledge of the Transferor,
threatened against the Transferor, before any court, regulatory body,
administrative agency or other tribunal or governmental instrumentality
(A) asserting the invalidity of this Agreement, (B) seeking to prevent
the consummation of any of the transactions contemplated by this
Agreement or (C) seeking any determination or ruling that, in the
reasonable judgment of the Transferor, would materially and adversely
affect the performance by the Transferor of its obligations under this
Agreement.
(vii) TITLE TO THE 99% 1999-A SUBI CERTIFICATES.
Immediately prior to the transfer of the 99% 1999-A SUBI Certificates
pursuant to this Agreement, the Transferor (A) is the true and lawful
owner of each 99% 1999-A SUBI Certificate and it has the legal right to
transfer each 99% 1999-A SUBI Certificate; (B) has good and valid title
to each 99% 1999-A SUBI Certificate and each 99% 1999-A SUBI
Certificate is on the date hereof free and clear of all Liens; (C) will
convey good, valid and indefeasible title to each 99% 1999-A SUBI
Certificate to the Transferee under this Agreement.
(b) The Transferee hereby represents and warrants to the Transferor as
of the date of this Agreement and the Closing Date that:
(i) ORGANIZATION AND GOOD STANDING. The Transferee is a
limited partnership duly formed, validly existing and in good standing
under the laws of the State of Delaware, and has 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 shall have, power, authority and legal right to
acquire, own and sell the Assets.
(ii) DUE QUALIFICATION. The Transferee is duly qualified
to do business as a foreign limited partnership 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, except where the failure to
have any such license, approval or qualification would not have a
material adverse effect on the condition, financial or otherwise, of
the Transferee or would not have a material adverse effect on the
ability of the Transferee to perform its obligations under this
Agreement.
4
<PAGE> 6
(iii) POWER AND AUTHORITY. The Transferee shall have the
power and authority to execute and deliver this Agreement and to carry
out its terms; and the execution, delivery and performance of this
Agreement shall have been duly authorized by the Transferee by all
necessary corporate action.
(iv) BINDING OBLIGATION. This Agreement constitutes a
legal, valid and binding obligation of the Transferee, enforceable
against it in accordance with its terms, except as enforceability may
be subject to or limited by bankruptcy, insolvency, reorganization,
moratorium, liquidation or other similar laws affecting the enforcement
of creditors' rights in general and by general principles of equity,
regardless of whether such enforceability shall be considered in a
proceeding in equity or at law.
(v) NO VIOLATION. The execution, delivery and performance
of this Agreement by the Transferee and the consummation of the
transactions contemplated by this Agreement and the fulfillment of the
terms hereof shall not conflict with, result in any breach of any of
the terms and provisions of, nor constitute (with or without notice or
lapse of time) a default under, the limited partnership agreement of
the Transferee, or conflict with or breach any of the material terms or
provisions of, or constitute (with or without notice or lapse of time)
a default under, any indenture, agreement or other instrument to which
the Transferee is a party or by which it may be bound or any of its
properties are subject; nor result in the creation or imposition of any
lien upon any of its properties pursuant to the terms of any material
indenture, agreement or other instrument (other than this Agreement);
nor violate any law or, to the knowledge of the Transferee, any order,
rule or regulation applicable to it or its properties of any court or
of any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Transferee or
any of its properties.
(vi) NO PROCEEDINGS. There are no proceedings or
investigations pending or, to the knowledge of the Transferee,
threatened against the Transferee, before any court, regulatory body,
administrative agency or other tribunal or governmental instrumentality
(A) asserting the invalidity of this Agreement, (B) seeking to prevent
the consummation of any of the transactions contemplated by this
Agreement or (C) seeking any determination or ruling that, in the
reasonable judgment of the Transferee, would materially and adversely
affect the performance by the Transferee of its obligations under this
Agreement.
(c) The representations and warranties set forth in this Section shall
survive the sale of the Assets by the Transferor to the Transferee and the sale
of the Assets by the Transferee to the Trust. Upon discovery by the Transferor,
the Transferee or the Trustee of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
prompt written notice to the others.
Section 2.03. FINANCING STATEMENT AND BOOKS AND RECORDS.
(a) In connection with the conveyance of the Assets hereunder, the
Transferor agrees that prior to the Closing Date, it will file, at its own
expense, one or more financing statements
5
<PAGE> 7
with respect to the Assets meeting the requirements of applicable state law in
such manner as necessary to perfect the sale of the Assets to the Transferor,
and the proceeds thereof (and any continuation statements as are required by
applicable state law), and to deliver a file-stamped copy of each such financing
statement (or continuation statement) or other evidence of such filings (which
may, for purposes of this Section, consist of telephone confirmation of such
filings with the file stamped copy of each such filings to be provided to the
Transferee in due course), as soon as is practicable after receipt by the
Transferor thereof.
(b) The Transferor further agrees that it will treat the transfer of
the Assets as a sale for accounting purposes, take no actions inconsistent with
the Transferee's ownership of the Assets and on or prior to the Closing Date
indicate on its books, records and statements that the Assets have been sold to
the Transferee.
Section 2.04. ACCEPTANCE BY THE TRANSFEREE. The Transferee agrees to
comply with all covenants and restrictions applicable to a Holder of each 99%
1999-A SUBI Certificate and the interest in the respective 1999-A SUBI
represented thereby, whether set forth in the respective 99% 1999-A SUBI
Certificate, in the SUBI Trust Agreement or otherwise, and assumes all
obligations and liabilities, if any, associated therewith.
ARTICLE THREE
MISCELLANEOUS
Section 3.01. AMENDMENT. This Agreement may be amended from time to
time in a writing signed by the parties hereto.
Section 3.02. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
any otherwise applicable principles of conflicts of laws (other than Section
5-1401 of the New York General Obligations Law).
Section 3.03. SEVERABILITY. If one or more of the covenants, agreements
or provisions of this Agreement shall be for any reason whatever held invalid or
unenforceable, such provisions shall be deemed severable from the remaining
covenants, agreements and provisions of this Agreement, and such invalidity or
unenforceability shall in no way affect the validity or enforceability of such
remaining covenants, agreements and provisions, or the rights of any parties
hereto. To the extent permitted by law, the parties hereto waive any provision
of law that renders any provision of this Agreement invalid or unenforceable in
any respect.
Section 3.04. BINDING EFFECT. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their permitted
successors and assigns.
Section 3.05. HEADINGS. The Article and Section headings are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.
6
<PAGE> 8
Section 3.06. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which so executed and delivered shall be deemed
to be an original, but all of which counterparts shall together constitute but
one and the same instrument.
Section 3.07. FURTHER ASSURANCES. Each party hereto shall do such acts,
and execute and deliver to the other party such additional documents or
instruments as may be reasonably requested in order to effect the purposes of
this Agreement and to better assure and confirm unto the requesting party its
rights, powers and remedies hereunder.
Section 3.08. THIRD-PARTY BENEFICIARIES. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and each Holder of a 99%
1999-A SUBI Certificate, who shall be considered third-party beneficiaries
hereof. Except as otherwise provided in this Agreement, no other Person shall
have any right or obligation hereunder.
Section 3.09. NO PETITION. Each of the parties hereto covenants and
agrees that prior to the date which is one year and one day after the date upon
which all obligations under each Securitized Financing have been paid in full,
it will not institute against, or join any other Person in instituting against
any Grantor, the Owner Trustee, the Trustee, any Special Purpose Affiliate, any
member of a Special Purpose Affiliate or any Grantor that is a limited liability
company (or any of their respective general partners) or any general partner of
a Special Purpose Affiliate or any Grantor that is a partnership, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding or
other proceedings under any federal or state bankruptcy or similar law.
7
<PAGE> 9
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers duly authorized as of the day and
year first above written.
RYDER TRUCK RENTAL I LP,
as Transferor
By: RYDER TRUCK RENTAL I LLC,
as General Partner
By: RTR LEASING I, INC.,
as Manager
By:
--------------------------------
Name:
Title:
RYDER FUNDING LP,
as Transferee
By: RYDER TRUCK RENTAL III LLC,
as General Partner
By: RTR LEASING II, INC.,
as Manager
By:
--------------------------------
Name:
Title:
8
<PAGE> 1
EXHIBIT 10.6
================================================================================
RYDER FUNDING LP,
as Transferor,
and
RYDER VEHICLE LEASE TRUST 1999-A,
as Transferee
------------------------------------------
ISSUER SUBI CERTIFICATE TRANSFER AGREEMENT
Dated as of October 1, 1999
------------------------------------------
================================================================================
<PAGE> 2
ISSUER SUBI CERTIFICATE TRANSFER AGREEMENT
This Issuer SUBI Certificate Transfer Agreement, dated as of October 1,
1999 (the "Agreement"), is between Ryder Funding LP, a Delaware limited
partnership, as transferor (the "Transferor"), and Ryder Vehicle Lease Trust
1999-A, a Delaware business trust (the "Issuer"), as transferee (in such
capacity, the "Transferee").
RECITALS
WHEREAS, Ryder Truck Rental I LP ("RTR I LP") and Ryder Truck Rental II
LP ("RTR II LP"), as Grantors and UTI Beneficiaries, Ryder Truck Rental, Inc.,
as Administrative Agent, Delaware Trust Capital Management, Inc., as Delaware
Trustee, RTRT, Inc., as Trustee, and U.S. Bank National Association ("U.S.
Bank"), as Trust Agent, have entered into that certain second amended and
restated trust agreement, dated as of February 1, 1998 (the "Origination Trust
Agreement"), pursuant to which Ryder Truck Rental LT, a Delaware business trust
(the "Trust"), will take assignments and conveyances of and hold in trust
various assets (the "Trust Assets");
WHEREAS, the parties to the Origination Trust Agreement supplemented
the Origination Trust Agreement with a supplement, dated as of _______ 1, 1999
(together with the Origination Trust Agreement, the "SUBI Trust Agreement"), to
establish two special units of beneficial interest, the "1999-A Lease SUBI" and
the "1999-A Vehicle SUBI" (each, a "1999-A SUBI");
WHEREAS, in connection with the SUBI Trust Agreement a separate
portfolio of Leases (the "Specified Leases") and certain other related assets of
the Origination Trust have been allocated to 1999-A Lease SUBI, and the Vehicles
that are leased under the Specified Leases (the "Specified Vehicles") and
certain other related assets of the Origination Trust will be allocated to
1999-A Vehicle SUBI;
WHEREAS, the Origination Trust has created certificates evidencing a
99% beneficial interest and a 1% beneficial interest in each 1999-A SUBI
(respectively, the "99% 1999-A SUBI Certificates" and the "1% 1999-A SUBI
Certificates") and has issued the 99% 1999-A SUBI Certificates to Ryder Truck
Rental I LP ("RTR I LP") and the 1% 1999-A SUBI Certificates to Ryder Truck
Rental II LP ("RTR II LP);
WHEREAS, RTR I LP has transferred and assigned, without recourse, all
of RTR I LP's right, title and interest in and to the 99% 1999-A SUBI
Certificates to the Transferor pursuant to that certain SUBI certificate
transfer agreement, dated as of October 1, 1999 (the "SUBI Certificate Transfer
Agreement"), between RTR I LP and the Transferor;
WHEREAS, the Issuer was formed pursuant to that certain trust
agreement, dated as of June 21, 1999, as amended and restated as of October 1,
1999 (the "Trust Agreement"), between the Transferor and Chase Manhattan Bank
Delaware, as trustee;
<PAGE> 3
WHEREAS, the Transferor and the Transferee desire to enter into this
Agreement to provide for the transfer and assignment by the Transferor to the
Transferee, without recourse, of all of the Transferor's right, title and
interest in and to the 99% 1999-A Vehicle SUBI Certificate and the interest in
the respective 1999-A Vehicle SUBI represented thereby; and
WHEREAS, immediately after the transfer of the 99% 1999-A Vehicle SUBI
Certificate to the Issuer, the Issuer shall pledge the 99% 1999-A Vehicle SUBI
Certificate to U.S. Bank, as Indenture Trustee (the "Indenture Trustee")
pursuant to that certain indenture, dated as of October 1, 1999 (the
"Indenture"), between the Issuer and the Indenture Trustee.
NOW, THEREFORE, in consideration of the promises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE ONE
DEFINITIONS
Section 1.01. DEFINITIONS. Capitalized terms used herein that are not
otherwise defined shall have the meanings ascribed thereto in the SUBI Trust
Agreement or the Trust Agreement, as the case may be.
"AGREEMENT" means this Agreement, as amended or supplemented from time
to time.
"ASSETS" has the meaning set forth in Section 2.01(a)(v).
"SUBI TRUST AGREEMENT" has the meaning set forth in the recitals.
"TRUST AGREEMENT" has the meaning set forth in the recitals.
Section 1.02. INTERPRETIVE PROVISIONS. For all purposes of this
Agreement, except as otherwise expressly provided or unless the context
otherwise requires, (i) terms used in this Agreement include, as appropriate,
all genders and the plural as well as the singular, (ii) references to words
such as "herein", "hereof" and the like shall refer to this Agreement as a whole
and not to any particular part, Article or Section within this Agreement, (iii)
the term "include" and all variations thereof shall mean "include without
limitation", (iv) the term "or" shall include "and/or" and (v) the term
"proceeds" shall have the meaning ascribed thereto in the UCC.
2
<PAGE> 4
ARTICLE TWO
TRANSFER OF 99% 1999-A VEHICLE SUBI CERTIFICATE
Section 2.01. TRANSFER OF 99% 1999-A VEHICLE SUBI CERTIFICATE. In
consideration of the Transferee's delivery to, or upon the order of, the
Transferor of cash in the amount of $_____________ (the "Transfer Price"), the
Transferor hereby absolutely sells, transfers, assigns and otherwise conveys to
the Transferee, without recourse, and the Transferee does hereby purchase and
acquire all of the following (collectively, the "Assets"):
(i) all right, title and interest in and to the
99% 1999-A Vehicle SUBI Certificate and the interest in the
1999-A Vehicle SUBI represented thereby, including all monies
due and paid thereon or in respect thereof;
(ii) the right to realize upon any property that
underlies or may be deemed to secure the interest in the
1999-A Vehicle SUBI represented by the 99% 1999-A Vehicle SUBI
Certificate;
(iii) all of the Transferor's rights and
benefits, as Holder of the 99% 1999-A Vehicle SUBI Certificate
under the Administration Agreement and the SUBI Trust
Agreement;
(iv) all of the Transferor's rights to and
benefits in the 1999-A Vehicle SUBI under the Vehicle SUBI
Certificate Transfer Agreement; and
(v) all proceeds of the foregoing.
Section 2.02. TRUE SALE. The parties hereto intend that the sale,
transfer and assignment of the Assets constitute a true sale and assignment of
the Assets such that any interest in and title to the Assets would not be
property of the Transferor's estate in the event the Transferor becomes a debtor
in a case under any bankruptcy law. To the extent that the conveyance of the
Assets hereunder is characterized by a court or similar governmental authority
as a financing, it is intended by the Transferor and the Transferee that the
interest conveyed constitute a first priority grant of a perfected security
interest under the UCC as in effect in the State of New York by the Transferor
to the Transferee to secure the Transfer Price to the Transferor. The Transferor
does hereby grant to the Transferee a security interest in all of its rights,
title and privileges and interest in and to the Assets and the parties hereto
agree that this Agreement constitutes a "security agreement" under all
applicable law.
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<PAGE> 5
Section 2.03. REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR AND THE
TRANSFEREE.
(a) The Transferor hereby represents and warrants to the Transferee as
of the date of this Agreement and the Closing Date that:
(i) ORGANIZATION AND GOOD STANDING. The Transferor is a
limited partnership duly formed, validly existing and in good standing
under the laws of the State of Delaware, and has 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 shall have, power, authority and legal right to
acquire, own and sell the Assets.
(ii) DUE QUALIFICATION. The Transferor is duly qualified
to do business as a foreign limited partnership 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, except where the failure to
have any such license, approval or qualification would not have a
material adverse effect on the condition, financial or otherwise, of
the Transferor or would not have a material adverse effect on the
ability of the Transferor to perform its obligations under this
Agreement.
(iii) POWER AND AUTHORITY. The Transferor shall have the
power and authority to execute and deliver this Agreement and to carry
out its terms; and the execution, delivery and performance of this
Agreement shall have been duly authorized by the Transferor by all
necessary corporate action.
(iv) BINDING OBLIGATION. This Agreement constitutes a
legal, valid and binding obligation of the Transferor, enforceable
against it in accordance with its terms, except as enforceability may
be subject to or limited by bankruptcy, insolvency, reorganization,
moratorium, liquidation or other similar laws affecting the enforcement
of creditors' rights in general and by general principles of equity,
regardless of whether such enforceability shall be considered in a
proceeding in equity or at law.
(v) NO VIOLATION. The execution, delivery and performance
by the Transferor of this Agreement and the consummation of the
transactions contemplated by this Agreement and the fulfillment of the
terms hereof shall not conflict with, result in any breach of any of
the terms and provisions of, nor constitute (with or without notice or
lapse of time) a default under, the limited partnership agreement of
the Transferor, or conflict with or breach any of the material terms or
provisions of, or constitute (with or without notice or lapse of time)
a default under, any indenture, agreement or other instrument to which
the Transferor is a party or by which it may be bound or any of its
properties are subject; nor result in the creation or imposition of any
lien upon any of its properties pursuant to the terms of any material
indenture, agreement or other instrument (other than this Agreement);
nor violate any law or, to the knowledge of the Transferor, any order,
rule or regulation applicable to it or its properties of any court or
of any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Transferor or
any of its properties.
4
<PAGE> 6
(vi) NO PROCEEDINGS. There are no proceedings or
investigations pending or, to the knowledge of the Transferor,
threatened against the Transferor, before any court, regulatory body,
administrative agency or other tribunal or governmental instrumentality
(A) asserting the invalidity of this Agreement, (B) seeking to prevent
the consummation of any of the transactions contemplated by this
Agreement or (C) seeking any determination or ruling that, in the
reasonable judgment of the Transferor, would materially and adversely
affect the performance by the Transferor of its obligations under this
Agreement.
(vii) TITLE TO 1999-A VEHICLE SUBI CERTIFICATE.
Immediately prior to the transfer of the 99% 1999-A Vehicle SUBI
Certificate pursuant to this Agreement, the Transferor (A) is the true
and lawful owner of the 99% 1999-A Vehicle SUBI Certificate and it has
the legal right to transfer the 99% 1999-A Vehicle SUBI Certificate;
(B) has good and valid title to the 99% 1999-A Vehicle SUBI Certificate
and the 99% 1999-A Vehicle SUBI Certificate is on the date hereof free
and clear of all Liens; (C) will convey good, valid and indefeasible
title to the 99% 1999-A Vehicle SUBI Certificate to the Transferee
under this Agreement.
(b) The Transferee hereby represents and warrants to the Transferor as
of the date of this Agreement and the Closing Date that:
(i) ORGANIZATION AND GOOD STANDING. The Transferee is a
business trust duly formed, validly existing and in good standing under
the laws of the State of Delaware, and has 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 shall have, power, authority and legal right to
acquire, own and sell the Assets.
(ii) DUE QUALIFICATION. The Transferee is duly qualified
to do business as a foreign trust 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, except where the failure to have any such
license, approval or qualification would not have a material adverse
effect on the condition, financial or otherwise, of the Transferee or
would not have a material adverse effect on the ability of the
Transferee to perform its obligations under this Agreement.
(iii) POWER AND AUTHORITY. The Transferee shall have the
power and authority to execute and deliver this Agreement and to carry
out its terms; and the execution, delivery and performance of this
Agreement shall have been duly authorized by the Transferee by all
necessary corporate action.
(iv) BINDING OBLIGATION. This Agreement constitutes a
legal, valid and binding obligation of the Transferee, enforceable
against it in accordance with its terms, except as enforceability may
be subject to or limited by bankruptcy, insolvency, reorganization,
moratorium, liquidation or other similar laws affecting the enforcement
of
5
<PAGE> 7
creditors' rights in general and by general principles of equity,
regardless of whether such enforceability shall be considered in a
proceeding in equity or at law.
(v) NO VIOLATION. The execution, delivery and performance
of this Agreement by the Transferee and the consummation of the
transactions contemplated by this Agreement and the fulfillment of the
terms hereof shall not conflict with, result in any breach of any of
the terms and provisions of, nor constitute (with or without notice or
lapse of time) a default under, the trust agreement of the Transferee,
or conflict with or breach any of the material terms or provisions of,
or constitute (with or without notice or lapse of time) a default
under, any indenture, agreement or other instrument to which the
Transferee is a party or by which it may be bound or any of its
properties are subject; nor result in the creation or imposition of any
lien upon any of its properties pursuant to the terms of any material
indenture, agreement or other instrument (other than this Agreement);
nor violate any law or, to the knowledge of the Transferee, any order,
rule or regulation applicable to it or its properties of any court or
of any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Transferee or
any of its properties.
(vi) NO PROCEEDINGS. There are no proceedings or
investigations pending or, to the knowledge of the Transferee,
threatened against the Transferee, before any court, regulatory body,
administrative agency or other tribunal or governmental instrumentality
(A) asserting the invalidity of this Agreement, (B) seeking to prevent
the consummation of any of the transactions contemplated by this
Agreement or (C) seeking any determination or ruling that, in the
reasonable judgment of the Transferee, would materially and adversely
affect the performance by the Transferee of its obligations under this
Agreement.
(c) The representations and warranties set forth in this Section shall
survive the sale of the Assets by the Transferor to the Transferee and the sale
of the Assets by the Transferee to the Trust. Upon discovery by the Transferor,
the Transferee or the Trustee of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
prompt written notice to the others.
Section 2.04. FINANCING STATEMENT AND BOOKS AND RECORDS.
(a) In connection with the conveyance of the Assets hereunder, the
Transferor agrees that prior to the Closing Date, it will file, at its own
expense, one or more financing statements with respect to the Assets meeting the
requirements of applicable state law in such manner as necessary to perfect the
sale of the Assets to the Transferor, and the proceeds thereof (and any
continuation statements as are required by applicable state law), and to deliver
a file-stamped copy of each such financing statement (or continuation statement)
or other evidence of such filings (which may, for purposes of this Section,
consist of telephone confirmation of such filings with the file stamped copy of
each such filings to be provided to the Transferee in due course), as soon as is
practicable after receipt by the Transferor thereof.
6
<PAGE> 8
(b) The Transferor further agrees that it will treat the transfer of
the Assets as a sale for accounting purposes, take no actions inconsistent with
the Transferee's ownership of the Assets and on or prior to the Closing Date
indicate on its books, records and statements that the Assets have been sold to
the Transferee.
Section 2.05. ACCEPTANCE BY THE TRANSFEREE. The Transferee agrees to
comply with all covenants and restrictions applicable to a Holder of the 99%
1999-A Vehicle SUBI Certificate and the interest in the 1999-A Vehicle SUBI
represented thereby, whether set forth in the 99% 1999-A Vehicle SUBI
Certificate, in the SUBI Trust Agreement or otherwise, and assumes all
obligations and liabilities, if any, associated therewith.
ARTICLE THREE
MISCELLANEOUS
Section 3.01. AMENDMENT. This Agreement may be amended from time to
time in a writing signed by the parties hereto.
Section 3.02. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
any otherwise applicable principles of conflicts of laws (other than Section
5-1401 of the New York General Obligations Law).
Section 3.03. SEVERABILITY. If one or more of the covenants, agreements
or provisions of this Agreement shall be for any reason whatever held invalid or
unenforceable, such provisions shall be deemed severable from the remaining
covenants, agreements and provisions of this Agreement, and such invalidity or
unenforceability shall in no way affect the validity or enforceability of such
remaining covenants, agreements and provisions, or the rights of any parties
hereto. To the extent permitted by law, the parties hereto waive any provision
of law that renders any provision of this Agreement invalid or unenforceable in
any respect.
Section 3.04. BINDING EFFECT. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their permitted
successors and assigns.
Section 3.05. HEADINGS. The Article and Section headings are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.
Section 3.06. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which so executed and delivered shall be deemed
to be an original, but all of which counterparts shall together constitute but
one and the same instrument.
Section 3.07. FURTHER ASSURANCES. Each party hereto shall do such acts,
and execute and deliver to the other party such additional documents or
instruments as may be reasonably
7
<PAGE> 9
requested in order to effect the purposes of this Agreement and to better assure
and confirm unto the requesting party its rights, powers and remedies hereunder.
Section 3.08. THIRD-PARTY BENEFICIARIES. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and each Holder of the 99%
1999-A Vehicle SUBI Certificate, who shall be considered third-party
beneficiaries hereof. Except as otherwise provided in this Agreement, no other
Person shall have any right or obligation hereunder.
Section 3.09. NO PETITION. Each of the parties hereto covenants and
agrees that prior to the date which is one year and one day after the date upon
which all obligations under each Securitized Financing have been paid in full,
it will not institute against, or join any other Person in instituting against
any Grantor, the Owner Trustee, the Trustee, any Special Purpose Affiliate, any
member of a Special Purpose Affiliate or any Grantor that is a limited liability
company (or any of their respective general partners) or any general partner of
a Special Purpose Affiliate or any Grantor that is a partnership, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding or
other proceedings under any federal or state bankruptcy or similar law.
Section 3.10. LIMITATION OF LIABILITY OF OWNER TRUSTEE. Notwithstanding
anything contained herein to the contrary, this instrument has been
countersigned by Chase Manhattan Bank Delaware not in its individual capacity
but solely in its capacity as Owner Trustee of the Issuer and in no event shall
Chase Manhattan Bank Delaware in its individual capacity or any beneficial owner
of the Issuer have any liability for the representations, warranties, covenants,
agreements or other obligations of the Issuer hereunder, as to all of which
recourse shall be had solely to the assets of the Issuer. For all purposes of
this Agreement, in the performance of any duties or obligations of the Issuer
hereunder, the Owner Trustee shall be subject to, and entitled to the benefits
of, the terms and provisions of Articles Six, Seven and Ten of the Trust
Agreement. Notwithstanding anything herein to the contrary, Section 2.07 of the
Trust Agreement shall remain in full force and effect.
8
<PAGE> 10
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers duly authorized as of the day and
year first above written.
RYDER FUNDING LP,
as Transferor
By: RYDER TRUCK RENTAL III LLC,
as General Partner
By: RTR LEASING II, INC.,
as Manager
By:
------------------------------------
Name:
Title:
RYDER VEHICLE LEASE TRUST 1999-A,
as Transferee
By: CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
By:
------------------------------------
Name:
Title:
9
<PAGE> 1
Exhibit 10.7
===============================================================================
RYDER FUNDING LP,
as Transferor,
and
CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
------------------------------------------------------
AMENDED AND RESTATED TRUST AGREEMENT
Dated as of October 1, 1999
------------------------------------------------------
===============================================================================
<PAGE> 2
TABLE OF CONTENTS
Page
----
ARTICLE ONE
DEFINITIONS
Section 1.01. Capitalized Terms...................................... 1
Section 1.02. Interpretive Provisions................................ 8
ARTICLE TWO
ORGANIZATION
Section 2.01. Name and Status......................................... 9
Section 2.02. Office.................................................. 9
Section 2.03. Purposes and Powers..................................... 9
Section 2.04. Appointment of Owner Trustee............................10
Section 2.05. Initial Capital Contribution of Owner Trust Estate......10
Section 2.06. Declaration of Trust....................................10
Section 2.07. Liability of the Transferor.............................11
Section 2.08. Title to Trust Property.................................11
Section 2.09. Situs of Issuer.........................................11
Section 2.10. Representations and Warranties of the Transferor........12
ARTICLE THREE
TRUST CERTIFICATES, SUBORDINATED NOTES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership.......................................14
Section 3.02. The Trust Certificates and the Subordinated Notes.......14
Section 3.03. Authentication and Delivery of Trust Certificates and
Subordinated Notes....................................15
Section 3.04. Registration of Transfer and Exchange...................15
Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates
or Subordinated Notes.................................19
Section 3.06. Persons Deemed Trust Certificateholders or Subordinated
Noteholder............................................19
Section 3.07. Access to List of Trust Certificateholders' Names
and Addresses.........................................19
Section 3.08. Maintenance of Office or Agency.........................20
Section 3.09. Appointment of Paying Agent.............................20
Section 3.10. Ownership of Transferor Trust Certificate and
Subordinated Notes....................................21
Section 3.11. Trust Certificates held by Issuer, Transferor or
their Affiliates......................................21
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<PAGE> 3
Page
----
ARTICLE FOUR
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice to Trust Certificateholders with Respect
to Certain Matters....................................22
Section 4.02. Action by Trust Certificateholders with Respect
to Certain Matters....................................22
Section 4.03. Action by Owner Trustee with Respect to Bankruptcy......23
Section 4.04. Restrictions on Trust Certificateholders' Power.........23
Section 4.05. Majority Control........................................23
ARTICLE FIVE
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Establishment of Certificate Distribution Account
and Reserve Fund......................................24
Section 5.02. Application of Trust Funds..............................25
Section 5.03. Method of Payment.......................................27
Section 5.04. Accounting and Reports..................................28
ARTICLE SIX
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority.......................................29
Section 6.02. General Duties..........................................29
Section 6.03. Action Upon Instruction.................................29
Section 6.04. No Duties Except as Specified...........................30
Section 6.05. No Action Unless Specifically Authorized................31
Section 6.06. Restrictions............................................31
ARTICLE SEVEN
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties.........................32
Section 7.02. Furnishing of Documents.................................33
Section 7.03. Representations and Warranties..........................33
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<PAGE> 4
Page
----
Section 7.04. Reliance; Advice of Counsel.............................34
Section 7.05. Not Acting in Individual Capacity.......................34
Section 7.06. Owner Trustee Not Liable for Trust Certificates or
Subordinated Notes....................................35
Section 7.07. Owner Trustee May Own Trust Certificates
and Notes.............................................35
ARTICLE EIGHT
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Compensation and Indemnification........36
ARTICLE NINE
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement..........................37
Section 9.02. Dissolution upon Bankruptcy of the Transferor...........38
Section 9.03. Purchase of the 99% 1999-A Vehicle SUBI Certificate;
Redemption of the Subordinated Notes; Repayment
of the Trust Certificates.............................38
ARTICLE TEN
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee..............40
Section 10.02. Resignation or Removal of Owner Trustee.................40
Section 10.03. Successor Owner Trustee.................................41
Section 10.04. Merger or Consolidation of Owner Trustee................41
Section 10.05. Appointment of Co-Trustee or Separate Trustee...........41
ARTICLE ELEVEN
TAX MATTERS
Section 11.01. Tax and Accounting Characterization.....................43
Section 11.02. Signature on Returns; Tax Matters Partner...............45
Section 11.03. Tax Reporting...........................................46
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<PAGE> 5
Page
----
ARTICLE TWELVE
MISCELLANEOUS
Section 12.01. Supplements and Amendments..............................44
Section 12.02. No Legal Title to Owner Trust Estate....................45
Section 12.03. Limitations on Rights of Others.........................45
Section 12.04. Notices.................................................46
Section 12.05. Severability............................................46
Section 12.06. Counterparts............................................46
Section 12.07. Successors and Assigns..................................46
Section 12.08. No Petition.............................................50
Section 12.09. No Recourse.............................................50
Section 12.10. Headings................................................50
Section 12.11. Governing Law...........................................50
Section 12.12. Certificates Nonassessable and Fully Paid...............50
EXHIBITS
Exhibit A - Form of Trust Certificate.....................................A-1
Exhibit B - Form of Subordinated Note.....................................B-1
Exhibit C - Form of Rule 144A Certificate.................................C-1
Exhibit D - Form of Investor Representation Letter .......................D-1
iv
<PAGE> 6
AMENDED AND RESTATED TRUST AGREEMENT
This Amended and Restated Trust Agreement, dated as of October 1,
1999, is between Ryder Funding LP, a Delaware limited partnership, as
transferor (the "Transferor"), and Chase Manhattan Bank Delaware, a Delaware
banking corporation, as trustee (the "Owner Trustee").
WHEREAS, the parties hereto entered into that certain initial trust
agreement dated as of June 21, 1999 (the "Initial Trust Agreement") pursuant to
which the Ryder Vehicle Lease Trust 1999-A was created; and
WHEREAS, the parties hereto are entering into this Agreement pursuant
to which, among other things, the Initial Trust Agreement will be amended and
restated and $[_______________] aggregate principal amount of [___] % Asset
Backed Certificates and $[_______________] aggregate principal amount of [___]
% Asset Backed Subordinated Notes will be issued;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE ONE
DEFINITIONS
Section 1.01. Capitalized Terms. Capitalized terms used herein that
are not otherwise defined shall have the meanings ascribed thereto in the SUBI
Trust Agreement, the Administration Agreement or the Indenture, as the case may
be. Whenever used herein, unless the context otherwise requires, the following
words and phrases shall have the following meanings:
"Adjusted Fair Market Value" means with respect to any item
constituting part of the Owner Trust Estate, the greater of (i) the fair market
value of such asset or (ii) the amount of any non-recourse indebtedness to
which such asset is subject within the meaning of Section 7701(g) of the Code.
"Administration Agreement" means the Basic Administration Agreement as
supplemented by that certain supplement, dated as of October 1, 1999, among the
parties to the Basic Administration Agreement, as amended or supplemented from
time to time.
"Administrator" means Ryder, as Administrator under the Issuer
Administration Agreement, and its successors in such capacity.
"Agreement" means this Amended and Restated Trust Agreement, as the
same may be amended or supplemented from time to time.
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<PAGE> 7
"Authenticating Agent" means any Person authorized by the Owner
Trustee to act on behalf of the Owner Trustee to authenticate and deliver the
Trust Certificates and the Subordinated Notes.
"Basic Administration Agreement" means that certain administration
agreement, dated as of February 1, 1998, among Ryder Truck Rental I LP and
Ryder Truck Rental II LP, each as UTI Beneficiaries, the Origination Trust,
Ryder, as Administrative Agent, and Ryder, as Maintenance Provider.
"Benefit Plan" means (i) an employee benefit plan, as defined in
Section 3(3) of ERISA, that is subject to Title I of ERISA, (ii) a plan
described in Section 4975(e)(1) of the Code, (iii) a governmental plan, as
defined in Section 3(32) of ERISA, subject to any federal, state or local law
which is, to a material extent, similar to the provisions of Section 406 of
ERISA or Section 4975 of the Code, (iv) an entity whose underlying assets
include plan assets by reason of a plan's investment in the entity (within the
meaning of Department of Labor Regulation 29 C.F.R. Section 2510.3-101) or (v)
a person investing "plan assets" of any such plan (including, for purposes of
this clause, any insurance company general account but excluding any entity
registered under the Investment Company Act).
"Business Trust Statute" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. ss.3801 et seq., as the same may be amended from time to time.
"Capital Contribution" means the amount of cash or the Gross Asset
Value of property contributed to the Issuer by any Trust Certificateholder.
Upon initial sale of the Trust Certificates, the Capital Contribution of each
Trust Certificateholder (other than the Transferor) shall equal the amount paid
by such Trust Certificateholder for its Trust Certificates.
"Certificate Balance" means, as of any date, the aggregate principal
amount of the Trust Certificates as of such date.
"Certificate Distribution Account" means the account established
pursuant to Section 5.01.
"Certificate Factor" means, with respect to the Trust Certificates on
any Payment Date, the seven digit decimal equivalent of a fraction the
numerator of which is the Certificate Balance on such Payment Date (after
giving effect to any payment of principal on such Payment Date) and the
denominator of which is the Certificate Balance on the Closing Date.
"Certificate Rate" means [____]% per annum (computed on the basis of a
360-day year of twelve 30-day months).
"Certificate Register" and "Certificate Registrar" means the register
mentioned in and the registrar appointed pursuant to Section 3.04.
"Certificate of Trust" means the Certificate of Trust filed for the
Issuer pursuant to Section 3810(a) of the Business Trust Statute.
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<PAGE> 8
"Control Agreement" means that certain control agreement, dated as of
October 1, 1999, among the Transferor, the Issuer, the Indenture Trustee and
U.S. Bank National Association, as securities intermediary, as amended and
supplemented from time to time.
"Depreciation" means, for each fiscal or other period, an amount equal
to the depreciation, amortization or other cost recovery deductions allowable
with respect to an asset for such fiscal or other period under the Code, except
that if the Gross Asset Value of an asset differs from its adjusted basis for
federal income tax purposes at the beginning of such fiscal or other period,
Depreciation shall be an amount which bears the same ratio to such beginning
Gross Asset Value as the federal income tax depreciation, amortization or other
cost recovery deduction for such year or other beginning adjusted tax basis;
provided, however, that if the federal income tax depreciation, amortization or
other cost recovery deduction for such fiscal or other period is zero,
Depreciation shall be determined with reference to such beginning Gross Asset
Value or any reasonable method selected by the Transferor.
"Distribution Account" means either the Note Distribution Account or
the Certificate Distribution Account, as the context may require.
"Distribution Statement" has the meaning set forth in Section 5.02(c).
"Expenses" means 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.
"Fiscal Year" means the taxable year of the Issuer which, except in
the case of a short taxable year, shall be the year as is required by Section
706(b) of the Code.
"Gross Asset Value" means, with respect to any asset, such asset's
adjusted basis for federal income tax purposes except as follows:
(i) the initial Gross Asset Value of any asset contributed by a
Trust Certificateholder to the Issuer shall be the gross fair market
value of such asset at the time of contribution, as determined by the
contributing Trust Certificateholder and the Transferor;
(ii) the Gross Asset Values of all Issuer assets shall be
adjusted to equal their respective Adjusted Fair Market Values, as
reasonably determined by the Transferor as of the liquidation of the
Issuer within the meaning of Section 1.704-1(b)(2)(ii)(g) of the
Treasury Regulations;
(iii) if the Gross Asset Value of an asset has been determined or
adjusted pursuant to clause (i), (ii) or (iv) of this definition, such
Gross Asset Value shall thereafter be adjusted by the Depreciation
taken into account with respect to such asset for purposes of
computing income, gain, loss and deduction to be allocated to the
Capital Accounts of the Trust Certificateholders and the Transferor;
and
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(iv) for purposes of allocating Gross Asset Values with respect
to Issuer assets, the Transferor shall make such allocation in
accordance with the respective Adjusted Fair Market Values of such
assets, and such allocations shall be effective for all purposes under
this Agreement.
"Indemnified Parties" has the meaning set forth in Section 8.01(a).
"Indenture" means that certain indenture, dated as of October 1, 1999,
between the Issuer and U.S. Bank National Association, as Indenture Trustee, as
amended or supplemented from time to time.
"Initial Deposit" means the Transferor's deposit to the reserve fund,
on or before the Closing Date, of $-----------.
"Initial Purchaser" means Merrill Lynch, Pierce, Fenner & Smith
Incorporated, as initial purchaser pursuant to the Purchase Agreement.
"Initial Securities Balance" means the initial principal amount of the
Securities.
"Interest" means, as of any date, the ownership interest of a Trust
Certificateholder (including the Transferor as holder of the Transferor Trust
Certificate) in the Issuer as of such date, including the right of such Trust
Certificateholder to any and all benefits to which such Trust Certificateholder
may be entitled as provided in this Agreement, together with the obligations of
such Trust Certificateholder to comply with all the terms and provisions of
this Agreement.
"Investment Company Act" means the Investment Company Act of 1940, as
amended.
"Issuer" means the Ryder Vehicle Lease Trust 1999-A, and its
successors.
"Issuer Administration Agreement" means that certain issuer
administration agreement, dated as of October 1, 1999, among the Issuer, the
Indenture Trustee, the Transferor and the Administrator, as amended or
supplemented from time to time.
"Issuer SUBI Certificate Transfer Agreement" means that certain issuer
SUBI certificate transfer agreement, dated as of October 1, 1999, between the
Transferor and the Issuer, as amended or supplemented from time to time.
"Majority Interest" means, with respect to the Senior Notes, the
holders of a majority of the outstanding principal amount of the Senior Notes,
as one class.
"Note" means either a Senior Note or a Subordinated Note, as the
context may require.
"Noteholder" means a Senior Noteholder or the Subordinated Noteholder,
as the context may require.
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"Offered Securities" means the Senior Notes and the Trust Certificates
(other than the Transferor Trust Certificate).
"Offering Circular" means the Offering Circular, dated
[_____________], 1999, relating to the offering of the Trust Certificates, as
amended or supplemented from time to time.
"Opinion of Counsel" means one or more written opinions of counsel who
may, except as otherwise expressly provided in this Agreement, be employees of
or counsel to the Transferor, the Administrator or any of their respective
Affiliates, and which opinions shall be addressed to, and in form and substance
satisfactory to, the Owner Trustee.
"Optional Purchase" has the meaning set forth in Section 9.03(a).
"Optional Purchase Price" has the meaning set forth in Section 9.03(a).
"Origination Trust" means Ryder Truck Rental LT.
"Origination Trust Agreement" means that certain second amended and
restated trust agreement, dated as of February 1, 1998, among Ryder Truck
Rental I LP and Ryder Truck Rental II LP, each as Grantors and UTI
Beneficiaries, RTRT, Inc., as trustee, Delaware Trust Capital Management, Inc.,
as Delaware trustee, and U.S.
Bank National Association, as trust agent.
"Origination Trustee" means RTRT, Inc., in its capacity as trustee of
the Origination Trust, or any successor thereto in such capacity.
"Outstanding" means, with respect to the Subordinated Notes, as of any
date, all Subordinated Notes theretofore authenticated and delivered under this
Agreement except (a) Subordinated Notes theretofore canceled or delivered for
cancellation pursuant to this Agreement; (b) Subordinated Notes or portions
thereof for whose payment or redemption cash in the necessary amount has been
theretofore irrevocably deposited with the Issuer or any paying agent in trust
for the holders of such Subordinated Notes; and (c) Subordinated Notes in
exchange for or in lieu of which other Subordinated Notes have been
authenticated and delivered pursuant to this Agreement unless proof
satisfactory to the Issuer is presented that any such Subordinated Notes are
held by a bona fide Protected Purchaser.
"Outstanding Amount" means, as of any date, the aggregate principal
amount of all Subordinated Notes Outstanding as of such date.
"Owner Corporate Trust Office" means the principal office of the Owner
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of the execution of this Agreement is
located at 1201 Market Street, Wilmington, Delaware 19801-1167; or at such
other address as the Owner Trustee may designate from time to time by notice to
the Trust Certificateholders and the Indenture Trustee, or the principal
corporate trust office of any successor Owner Trustee (the address of which the
successor Owner Trustee shall notify the Trust Certificateholders and the
Indenture Trustee).
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"Owner Trust Estate" means the property of the Issuer, consisting of
(i) the 99% 1999-A Vehicle SUBI Certificate (transferred pursuant to the Issuer
SUBI Certificate Transfer Agreement), evidencing a 99% beneficial interest in
the assets allocated to the 1999-A Vehicle SUBI, including the right to
payments thereunder from certain Sales Proceeds on deposit in the SUBI
Collection Account and the Residual Value Surplus Account and investment
earnings, net of losses and investment expenses, on amounts on deposit in the
SUBI Collection Account and the Residual Value Surplus Account; (ii) the rights
of the Issuer under the Program Operating Lease; (iii) the rights of the Issuer
as secured party under the Back-up Security Agreement; (iv) the rights of the
Issuer as pledgee of the 99% 1999-A Lease SUBI Certificate; (v) the rights of
the Issuer to the funds on deposit from time to time in the Note Distribution
Account and any other account or accounts established pursuant to the Indenture
and all cash, investment property and other property from time to time
deposited or credited thereto; (vi) the rights of the Transferor, as
transferee, under the SUBI Certificate Transfer Agreement; (vii) the rights of
the Issuer, as transferee, under the Issuer SUBI Certificate Transfer
Agreement; (viii) the rights of the Issuer as a third-party beneficiary under
the Administration Agreement, including rights to certain Advances, and the
SUBI Trust Agreement; (ix) the security interest of the Issuer in the
Subordinated Notes and the Reserve Fund (including investment earnings, net of
losses and investment expenses, on amounts on deposit therein); and (x) all
proceeds of the foregoing.
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 3.09, and shall initially be The Chase Manhattan Bank.
"Program Operating Lease" means that certain program operating lease,
dated as of October 1, 1999, between the Issuer and the Transferor, as amended
or supplemented from time to time.
"Purchase Agreement" means that certain purchase agreement, dated
_____________ 1, 1999, between the Initial Purchaser and the Transferor.
"Qualified Institutional Buyer" has the meaning ascribed thereto in
Rule 144A.
"Record Date" means, with respect to any Payment Date, the close of
business on the Business Day immediately preceding such Payment Date.
"Repayment Price" means an amount equal to the unpaid principal amount
of the Trust Certificates repaid plus accrued and unpaid interest thereon at
the Certificate Rate to but excluding the related Payment Date.
"Reserve Fund" means the account established pursuant to Section 5.01.
"Reserve Fund Property" means the Reserve Fund and all cash,
investment property and other property from time to time deposited or credited
to the Reserve Fund and all proceeds thereof, including without limitation the
Initial Deposit and all payments of interest on and principal of the
Subordinated Notes.
"Reserve Fund Requirement" has the meaning set forth in the Indenture.
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"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Information" means information requested of the Transferor,
in connection with the proposed transfer of a Trust Certificate, to satisfy the
requirements of paragraph (d)(4) of Rule 144A.
"Secretary of State" means the Secretary of State of the State of
Delaware.
"Secured Obligations" has the meaning set forth in Section 5.02(f).
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Balance" means, as of any date, the unpaid principal
amount of the Securities as of such date.
"Security" means either a Note or a Trust Certificate, as the context
may require.
"Securityholder" means each registered holder of a Security.
"Senior Note Outstanding Amount" has the meaning ascribed to the term
"Outstanding Amount" in the Indenture.
"SUBI Trust Agreement" means the Origination Trust Agreement as
supplemented by that certain supplement, dated as of October 1, 1999, among the
parties to the Origination Trust Agreement, as amended or supplemented from
time to time.
"Subordinated Note Factor" means, with respect to the Subordinated
Notes on any Payment Date, the seven digit decimal equivalent of a fraction the
numerator of which is the Outstanding Amount on such Payment Date (after giving
effect to any payment of principal on such Payment Date) and the denominator of
which is the Outstanding Amount of the Subordinated Notes on the Closing Date.
"Subordinated Note Rate" means [___]% per annum (computed on the basis
of a 360-day year of twelve 30-day months).
"Subordinated Note Redemption Price" means an amount equal to the
unpaid principal amount of the Subordinated Notes redeemed plus accrued and
unpaid interest thereon at the Subordinated Note Rate to but excluding the
related Payment Date.
"Subordinated Noteholder" means the Transferor, as holder of the
Subordinated Notes.
"Subordinated Notes" means the [___]% Subordinated Notes issued
pursuant to this Agreement.
"Transferor Trust Certificate" means the Trust Certificate issued to
the Transferor representing at least 1% of the Certificate Balance.
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"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 Certificateholder" means the Person in whose name a Trust
Certificate is registered on the Certificate Register.
"Trust Certificates" means the [___]% Asset Backed Certificates issued
pursuant to this Agreement, substantially in the form of Exhibit A.
Section 1.02. Interpretive Provisions.
(a) For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, (i) terms used herein
include, as appropriate, all genders and the plural as well as the singular,
(ii) references to words such as "herein", "hereof" and the like shall refer to
this Agreement as a whole and not to any particular part, article or section
within this Agreement, (iii) references to a section such as "Section 1.01" and
the like shall refer to the applicable section of this Agreement, (iv) the term
"include" and all variations thereof shall mean "include without limitation"
and (v) the term "or" shall include "and/or".
(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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ARTICLE TWO
ORGANIZATION
Section 2.01. Name and Status. The trust created hereby shall be known
as "Ryder Vehicle Lease Trust 1999-A", in which name the Issuer may engage in
activities as permitted by the Basic Documents, make and execute contracts and
other instruments and sue and be sued, to the extent provided herein. It is the
intention of the parties hereto that the Issuer shall be a business trust under
the Business Trust Statute, and that this Agreement shall constitute the
governing instrument of that business trust.
Section 2.02. Office. The chief executive office and principal place
of business of the Issuer shall be in care of the Owner Trustee, initially at
the Owner Corporate Trust Office and thereafter at such other address as the
Owner Trustee may designate by written notice to the Trust Certificateholders
and the Transferor.
Section 2.03. Purposes and Powers.
(a) The purposes of the Issuer are: (i) at the direction of the Trust
Certificateholders, to take assignments and conveyances of certain assets from
time to time, to hold in such assets in trust and to collect and disburse the
periodic income therefrom for the benefit of the Trust Certificateholders, (ii)
to engage in any of the other activities described or authorized in this
Agreement, any supplement or any amendment hereto or thereto and (iii) to
engage in any and all activities that are necessary or appropriate to
accomplish the foregoing or that are incidental thereto or connected therewith.
The Trust shall not be employed for any purpose except as duly authorized in
accordance with the provisions of this Agreement.
(b) The initial sole purpose of the Issuer is to conserve the Owner
Trust Estate and collect and disburse the periodic income therefrom for the use
and benefit of the Trust Certificateholders, and in furtherance of such purpose
to engage in the following ministerial activities:
(i) to issue the Senior Notes pursuant to the Indenture, the
Subordinated Notes and the Trust Certificates pursuant to this
Agreement, and to sell the Notes and the Trust Certificates upon the
written order of the Transferor;
(ii) to acquire the 99% 1999-A Vehicle SUBI Certificate from the
Transferor and the other property of the Owner Trust Estate, using the
proceeds from the sale of the Offered Securities to third party
investors and from the issuance of the Subordinated Notes and the
Transferor Trust Certificate to the Transferor;
(iii) subject to the Lien of the Indenture, to lease the 99%
1999-A Vehicle SUBI Certificate to the Transferor pursuant to the
Program Operating Lease and as security therefor to obtain the pledge
of the 99% 1999-A Lease SUBI Certificate from the Transferor;
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(iv) to pay interest on and principal of the Securities;
(v) to assign, grant, transfer, pledge mortgage and convey the
Owner Trust Estate pursuant to the Indenture to the Indenture Trustee
as security for the Senior Notes and to hold, manage and distribute to
the Subordinated Noteholder and the Trust Certificateholders pursuant
to the terms of this Agreement any portion of the Owner Trust Estate
released from the Lien of, and remitted to the Issuer pursuant to, the
Indenture;
(vi) to enter into and perform its obligations under the Basic
Documents to which the Issuer is a party;
(vii) to engage in other transactions, including entering into
agreements, that are necessary, suitable or convenient to accomplish
the foregoing or that are incidental thereto or connected therewith;
and
(viii) 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 Trust Certificateholders and the Noteholders.
(b) The Issuer 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 Transferor hereby
appoints the Owner Trustee as trustee of the Issuer effective as of the date
hereof, to have all the rights, powers and duties set forth herein, and the
Owner Trustee hereby accepts such appointment.
Section 2.05. Initial Capital Contribution of Owner Trust Estate. The
Transferor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, as of the date hereof, the sum of $1.00. The Owner Trustee hereby
acknowledges receipt in trust from the Transferor, as of the date hereof, of
the foregoing contribution, which shall constitute the initial Owner Trust
Estate and shall be deposited in the Certificate Distribution Account. The
Transferor shall pay organizational expenses of the Issuer 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 will hold the Owner Trust Estate in trust upon and subject to the
conditions set forth herein for the sole purpose of conserving the Owner Trust
Estate and collecting and disbursing the periodic income therefrom for the use
and benefit of the Trust Certificateholders, who are intended to be "beneficial
owners" within the meaning of the Business Trust Statute, subject to the Lien
of the Indenture Trustee and the obligations of the Issuer under the Basic
Documents. Effective as of the date hereof, the Owner Trustee shall have all
rights, powers and duties set forth herein and under Delaware law for the sole
purpose and to the extent necessary to accomplish the purpose of the Issuer as
set forth in Section 2.03(a) and 2.03(b).
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Section 2.07. Liability of the Transferor.
(a) The Transferor, as holder of the Transferor Trust Certificate and
the Subordinated Notes, shall be liable directly to (other than payment of
principal and interest on the Securities) and shall indemnify any party
entitled thereto for all Expenses of the Issuer incurred in connection with the
1999-A SUBI Assets to the extent that the Transferor, as holder of the
Transferor Trust Certificate and the Subordinated Notes, would be liable if the
Issuer were a partnership under the Delaware Revised Uniform Limited
Partnership Act (or the Delaware Uniform Partnership Law) in which each such
holder were a general partner (other than losses incurred by Senior Noteholders
in their capacity as holders of limited recourse debt secured by the Owner
Trust Estate or incurred by the Subordinated Noteholder or the Trust
Certificateholders if such losses would nevertheless have been incurred if the
Subordinated Noteholder and the Trust Certificateholders were holders of
limited recourse debt secured by the Owner Trust Estate). In addition, any
third party creditors of the Issuer (other than the Subordinated Noteholder and
the Trust Certificateholders, to the extent they are not indemnified for
investment losses, as set forth above) shall be deemed to be third party
beneficiaries of this paragraph. The Transferor, as holder of the Transferor
Trust Certificate and the Subordinated Notes, shall make no claim upon the
Owner Trust Estate for the reimbursement of amounts paid pursuant to this
Section.
(b) The Transferor, as holder of the Transferor Trust Certificate and
the Subordinated Notes, shall defend, indemnify and hold harmless the Issuer
and the Owner Trustee from and against any and all taxes that may at any time
be asserted against the Issuer or the Owner Trustee with respect to the
transactions contemplated herein, including any sales, use, gross receipts,
general corporation, tangible personal property, privilege, license or income
taxes, taxes on or measured by income or any state or local taxes assessed on
the Issuer, the Owner Trustee or any Paying Agent resulting from the location
of assets of the Issuer or the presence of the Owner Trustee or any Paying
Agent and costs and Expenses in defending against the same; provided, however,
that the foregoing indemnity shall not include income taxes on any fees or
Expenses payable to the Owner Trustee or any Paying Agent.
(c) No Trust Certificateholder, other than the Transferor (as holder
of the Transferor Trust Certificate and the Subordinated Notes), shall have any
personal liability for any liability or obligation of the Issuer.
Section 2.08. Title to Trust Property. Legal title to the Owner Trust
Estate shall be vested at all times in the Issuer 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, in which case title shall be
deemed to be vested in the Owner Trustee, a co-trustee or a separate trustee,
as the case may be.
Section 2.09. Situs of Issuer. The Issuer shall be located and
administered in the State of Delaware. All bank accounts maintained by the
Owner Trustee on behalf of the Issuer shall be located in Florida, Delaware or
New York. The Issuer shall not have any employees in any state other than
Delaware; provided, however, that nothing herein shall restrict or prohibit the
Owner Trustee from having employees within or without the State of Delaware.
Payments shall be received by the Issuer only in Delaware, Florida or New York
and payments shall be made by the Issuer only from Delaware, Florida or New
York. The only office of the Issuer shall be at the Owner Corporate Trust
Office.
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Section 2.10. Representations and Warranties of the Transferor. The
Transferor hereby represents and warrants to the Owner Trustee that:
(a) Organization and Good Standing. The Transferor has been duly
organized and validly existing as a limited partnership in good
standing under the laws of the State of Delaware, with the power and
authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently
conducted.
(b) Due Qualification. The Transferor has been duly qualified to
do business as a limited partnership in good standing, and shall have
obtained all necessary licenses and approvals in all jurisdictions in
which the conduct of its business shall require such qualifications
except when the failure to have any such license, approval or
qualification would not have a material adverse effect on the
condition, financial or otherwise, of the Transferor or would not have
a material adverse effect on the ability of the Transferor to perform
its obligations under this Agreement.
(c) Power and Authority. The Transferor has (i) the power and
authority to execute and deliver this Agreement and to carry out its
terms; (ii) good title to and is the sole legal and beneficial owner
of the 99% SUBI Certificates, free and clear of Liens and claims;
(iii) full power and authority to transfer the 99% 1999-A Vehicle SUBI
Certificate and pledge the 99% 1999-A Lease SUBI Certificate to and
deposit each of the same with the Issuer; (iv) duly authorized such
transfer and deposit to the Issuer by all necessary action; and (v)
duly authorized the execution, delivery and performance of this
Agreement by all necessary action.
(d) Binding Obligation. This Agreement constitutes a legal, valid
and binding obligation of the Transferor, enforceable in accordance
with its terms, except as such enforceability may be subject to or
limited by bankruptcy, insolvency, reorganization, moratorium,
liquidation, fraudulent conveyance or other similar laws affecting the
enforcement of creditors' rights in general and by general principles
of equity, regardless of whether such enforceability shall be
considered in a proceeding in equity or in law.
(e) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms of
this Agreement do not conflict with or breach any of the terms or
provisions of, or constitute (with or without notice or lapse of time)
a default under, any material indenture, agreement or other instrument
to which the Transferor is a party or by which it shall be bound; nor
result in the creation or imposition of any material Lien upon any of
its properties pursuant to the terms of any such indenture, agreement
or other instrument (other than this Agreement); nor 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 federal
or State regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Transferor or its
properties.
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(f) No Proceedings. There are no proceedings or investigations
pending, or to the Transferor's knowledge, 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 or any of
the other Basic Documents; (ii) seeking to prevent the issuance of the
Notes or the Trust Certificates or the consummation of any of the
transactions contemplated by this Agreement 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 or any of the other Basic Documents; or (iv) relating to the
Transferor and that might adversely affect the federal income tax or
state income or franchise tax attributes of the Notes or the Trust
Certificates.
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ARTICLE THREE
TRUST CERTIFICATES, SUBORDINATED NOTES
AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership. Upon the formation of the Issuer by
the contribution by the Transferor pursuant to Section 2.05 and until the
issuance of the Trust Certificates, the Transferor shall be the sole
beneficiary of the Issuer.
Section 3.02. The Trust Certificates and the Subordinated Notes.
(a) The Trust Certificates shall be substantially in the form set
forth in Exhibit A, in minimum denominations of $250,000 and integral multiples
of $1,000 in excess thereof; provided, however, that the Transferor Trust
Certificate shall be issued to the Transferor pursuant to Section 3.10(a) in
such denominations as to represent in the aggregate at least 1% of the
Certificate Balance. The Subordinated Notes shall be issued substantially in
the form set forth in Exhibit B, in minimum denominations of $250,000 and
integral multiples of $1,000 in excess thereof. Except for (i) the issuance of
the Trust Certificates to the Initial Purchaser and the subsequent transfer to
the Trust Certificateholders as contemplated by the Purchase Agreement, (ii)
the issuance of the Transferor Trust Certificate to the Transferor, (iii) the
issuance of the Subordinated Notes to the Transferor and (iv) the assignment
and pledge of the Subordinated Notes to the Issuer, no Trust Certificate or
Subordinated Note may be sold, pledged or otherwise transferred to any Person
except in accordance with Section 3.04 and any attempted sale, pledge or
transfer in violation of Section 3.04 shall be null and void. Each Trust
Certificate (other than the Transferor Trust Certificate) shall be issued in
the name of the Initial Purchaser; provided, however, that upon delivery to the
Initial Purchaser, the Owner Trustee and the Certificate Registrar of a letter
in the form of Exhibit D, such Trust Certificate (other than the Transferor
Trust Certificate) shall be reissued in the name and in the denomination set
forth in such letter.
Except as otherwise contemplated by the Basic Documents, neither the
Subordinated Notes nor any beneficial interest therein may be transferred to
any Person, and any attempted transfer thereof shall be null and void;
provided, that upon a dissolution of or termination of the Transferor, any
Subordinated Notes held by the Transferor may be distributed to Ryder. The
Subordinated Notes shall be issued in the name of the Transferor.
The Trust Certificates and the Subordinated Notes may be in printed or
in typewritten form, and may be executed on behalf of the Issuer by manual or
facsimile signature of an Authenticating Agent. Trust Certificates and
Subordinated Notes bearing the manual or facsimile signatures of individuals
who were, at the time when such signatures shall have been affixed, authorized
to sign on behalf of the Issuer, shall be validly issued and entitled to the
benefits of this Agreement, notwithstanding that such individuals or any of
them shall have ceased to be so authorized prior to the authentication and
delivery of such Trust Certificates or Subordinated Notes or did not hold such
offices at the date of authentication and delivery of such Trust Certificates
or Subordinated Notes. If registration of a transfer of a Trust Certificate is
permitted pursuant to Section 3.04, the transferee of such Trust Certificate
shall become a Trust Certificateholder, and shall be entitled to the rights and
subject to the obligations of a Trust Certificateholder hereunder, upon due
registration of such Trust Certificate in such transferee's name pursuant to
Section 3.04.
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(b) Interest shall accrue during each Accrual Period on (i) the
Subordinated Notes at the Subordinated Note Rate based on the Outstanding
Amount until the principal amount of the Subordinated Notes has been paid in
full and (ii) the Trust Certificates at the Certificate Rate based on the
Certificate Balance until the principal amount of the Trust Certificates has
been paid in full. Interest accrued during each Accrual Period on the
Subordinated Notes and the Trust Certificates shall be due and payable on the
related Payment Date. Interest shall be calculated on the basis of a 360-day
year consisting of twelve 30-day months. To the extent that interest on the
Subordinated Notes or the Trust Certificates is accrued but not paid in full on
any Payment Date, such overdue interest shall be due on the next Payment Date
together with interest on such amount (to the extent lawful) at the
Subordinated Note Rate or the Certificate Rate, as the case may be. Payments of
interest and principal shall be payable to the Subordinated Noteholder and the
Trust Certificateholders in accordance with Section 5.02.
Section 3.03. Authentication and Delivery of Trust Certificates and
Subordinated Notes. Concurrently with the transfer of the 99% 1999-A Vehicle
SUBI Certificate and the pledge of the 99% 1999-A Lease SUBI Certificate to the
Issuer, the Owner Trustee shall cause to be executed on behalf of the Issuer
(i) Trust Certificates in an aggregate principal amount equal to
$[______________] and (ii) Subordinated Notes in an aggregate principal amount
equal to $[______________], in each case authenticated and delivered to or upon
the written order of the Transferor, in authorized denominations. No Trust
Certificate or Subordinated Note shall entitle its holder to any benefit under
this Agreement, or shall be valid for any purpose, unless there shall appear on
such Security a certificate of authentication, substantially in the form set
forth in Exhibit A or Exhibit B, as the case may be, executed by the Owner
Trustee or its Authenticating Agent, by manual signature; such authentication
shall constitute conclusive evidence that such Trust Certificate or
Subordinated Note shall have been duly authenticated and delivered hereunder.
All Trust Certificates and Subordinated Notes shall be dated the date of their
authentication. Upon issuance, execution and delivery pursuant to the terms
hereof, the Subordinated Notes and the Trust Certificates shall be entitled to
the benefits of this Agreement.
Section 3.04. Registration of Transfer and Exchange.
(a) The Certificate Registrar shall cause to be kept a register (the
"Certificate Register") in which, subject to such reasonable regulations as it
may prescribe, the Certificate Registrar shall provide for the registration of
Trust Certificates and Subordinated Notes and, if and to the extent transfers
and exchanges are permitted pursuant to Section 3.04(b), the registration of
transfers of Trust Certificates. No transfer of a Trust Certificate shall be
recognized except upon registration of such transfer. The Chase Manhattan Bank
is hereby appointed as the initial "Certificate Registrar". Upon any
resignation of the Certificate Registrar, the Owner Trustee shall promptly
appoint a successor. The Subordinated Notes may not be transferred, except as
permitted by the Basic Documents.
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(b) Each Trust Certificate (other than the Transferor Trust
Certificate) shall bear a legend regarding reoffers, resales, pledges and
transfers to the effect of the legend on the form of Trust Certificate attached
as Exhibit A hereto, unless determined otherwise by the Administrative Agent
(as certified to the Certificate Registrar in an Officer's Certificate)
consistent with applicable law.
As a condition to the registration of any transfer of a Trust
Certificate, the prospective transferee shall be required to represent in
writing to the Owner Trustee, the Transferor and the Certificate Registrar the
following:
(i) It has neither acquired nor will it transfer any Trust
Certificate it purchases (or any interest therein) or cause any such
Trust Certificates (or any interest therein) to be marketed on or
through an "established securities market" within the meaning of
Section 7704(b)(1) of the Code, including, without limitation, an
over-the-counter-market or an interdealer quotation system that
regularly disseminates firm buy or sell quotations.
(ii) It either (A) is not, and will not become, a partnership,
Subchapter S corporation or grantor trust for U.S. federal income tax
purposes or (B) is such an entity, but none of the direct or indirect
beneficial owners of any of the interests in such transferee have
allowed or caused, or will allow or cause, 50% or more (or such other
percentage as the Transferor may establish prior to the time of such
proposed transfer) of the value of such interests to be attributable
to such transferee's ownership of Trust Certificates.
(iii) It understands that no subsequent transfer of the Trust
Certificates is permitted unless (A) such transfer is of a Trust
Certificate with a denomination of at least $250,000, (B) it causes
its proposed transferee to provide to the Issuer, the Certificate
Registrar and the Initial Purchaser a letter substantially in the form
of Exhibit D hereto, or such other written statement as the Transferor
shall prescribe and (C) the Transferor consents in writing to the
proposed transfer, which consent shall be granted unless the
Transferor determines that such transfer would create a risk that the
Issuer or the Origination Trust would be classified for federal or any
applicable state tax purposes as an association (or a publicly traded
partnership) taxable as a corporation; provided, however, that any
attempted transfer that would either cause (1) the number of
registered holders of Trust Certificates and Subordinated Notes to
exceed 100 or (2) the number of holders of direct or indirect
interests in the Origination Trust to exceed 50, shall be a void
transfer.
(iv) It understands that the Opinion of Counsel to the Issuer
that the Issuer is not a publicly traded partnership taxable as a
corporation is dependent in part on the accuracy of the
representations in paragraphs (i), (ii) and (iii) above.
(v) It is not a Benefit Plan nor will it hold the Trust
Certificates being transferred for the account of a Benefit Plan.
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(vi) It is a Person who is either (A)(1) a citizen or resident of
the United States, (2) a corporation, partnership or other entity
organized in or under the laws of the United States or any political
subdivision thereof or (3) a Person not described in (A)(1) or (2)
whose ownership of the Trust Certificates is effectively connected
with such Person's conduct of a trade or business within the United
States (within the meaning of the Code) and its ownership of any
interest in a Trust Certificate will not result in any withholding
obligation with respect to any payments with respect to the Trust
Certificates by any Person (other than withholding, if any, under
Section 1446 of the Code) or (B) an estate or trust the income of
which is includible in gross income for federal income tax purposes,
regardless of source or a trust if a court within the United States is
able to exercise primary supervision of the administration of the
trust and one or more U.S. Persons (as such term is defined in the
Code) have the authority to control all substantial decisions of the
Issuer. It agrees that it will provide a certification of non-foreign
status signed under penalty of perjury and, alternatively, that if it
is a Person described in clause (A)(3) above, it will furnish to the
Transferor and the Owner Trustee a properly executed IRS Form 4224 and
a new IRS Form 4224 upon the expiration or obsolescence of any
previously delivered form (and such other certifications,
representations or Opinions of Counsel as may be requested by the
Transferor and the Owner Trustee).
(vii) It understands that any purported transfer of any Trust
Certificate (or any interest therein) in contravention of any of the
restrictions and conditions in this Section shall be void, and the
purported transferee in such transfer shall not be recognized by the
Issuer or any other Person as a Trust Certificateholder for any
purpose.
(c) By acceptance of any Trust Certificate, the related Trust
Certificateholder specifically agrees with and represents to the Transferor,
the Issuer and Certificate Registrar that no transfer of such Trust Certificate
shall be made unless the registration requirements of the Securities Act and
any applicable state securities laws are complied with, or such transfer is
exempt from the registration requirements under the Securities Act because the
transfer satisfies one of the following:
(i) such transfer is in compliance with Rule 144A, to a
transferee who the transferor reasonably believes is a Qualified
Institutional Buyer that is purchasing for its own account or for the
account of a Qualified Institutional Buyer and to whom notice is given
that such transfer is being made in reliance upon Rule 144A and (A)
the transferor thereof executes and delivers to the Transferor and the
Certificate Registrar, a Rule 144A certificate substantially in the
form attached as Exhibit C and (B) the transferee executes and
delivers to the Transferor and the Certificate Registrar an investment
letter substantially in the form attached as Exhibit D.
(ii) after the appropriate holding period, such transfer is
pursuant to an exemption from registration under the Securities Act
provided by Rule 144 under the Securities Act and the transferee, if
requested by the Transferor, the Certificate Registrar or the Initial
Purchaser, delivers an Opinion of Counsel in form and substance
satisfactory to the Transferor and the Initial Purchaser.
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(iii) such transfer is to an institutional accredited investor as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D promulgated
under the Securities Act in a transaction exempt from the registration
requirements of the Securities Act, such transfer is in accordance
with any applicable securities laws of any State or any other
jurisdiction, and such investor executes and delivers to the Issuer
and the Certificate Registrar an investment letter substantially in
the form attached as Exhibit D.
(d) The Transferor shall make the Rule 144A Information available to
the prospective transferor and transferee of a Trust Certificate. The Rule 144A
Information shall include any or all of the following items requested by the
prospective transferee:
(i) the Offering Circular, as amended or supplemented to the date
of such transfer;
(ii) each Payment Date Certificate delivered to Trust
Certificateholders on each Payment Date preceding such request; and
(iii) such other information as is reasonably available to the
Transferor in order to comply with requests for information pursuant
to Rule 144A.
None of the Transferor, the Certificate Registrar or the Owner Trustee
is under an obligation to register any Trust Certificate under the Securities
Act or any state securities laws.
(e) Upon surrender for registration of transfer or exchange of any
Trust Certificate at the office of the Certificate Registrar and upon
compliance with the provisions of this Agreement relating to such transfer or
exchange, provided that the requirements of Section 8-401(a) of the UCC are
met, the Owner Trustee shall execute and shall, or shall cause the
Authenticating Agent to, authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Trust Certificates in
authorized denominations of a like aggregate face amount dated the date of such
authentication or the Trust Certificates that the Trust Certificateholder
making the exchange is entitled to receive, as the case may be.
The Certificate Registrar shall require that every Trust Certificate
presented or surrendered for registration of transfer or exchange shall be
accompanied by a written instrument of transfer and accompanied by IRS Form
4224 or W-9 or such other form as may be reasonably required in form
satisfactory to the Certificate Registrar duly executed by the Trust
Certificateholder or such Person's attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Trust Certificates, but the Owner Trustee or the Certificate
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Trust Certificates.
The Certificate Registrar shall cancel and retain or destroy, in
accordance with the Certificate Registrar's retention policy then in effect,
all Trust Certificates surrendered for registration of transfer or exchange and
shall upon written request certify to the Transferor as to such retention or
destruction.
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(f) The provisions of this Section generally are intended, among other
things, to prevent the Issuer from being characterized as a "publicly traded
partnership" within the meaning of Section 7704 of the Code, in reliance on
Treasury Regulations Section 1.7704-1(e) and (h), and the Transferor shall take
such intent into account in determining whether or not to consent to any
proposed transfer of any Trust Certificate.
The preceding provisions of this Section notwithstanding, the Owner
Trustee shall not make and the Certificate Registrar shall not register any
transfer or exchange of Trust Certificates for a period of 15 days preceding
the due date for any payment with respect to the Trust Certificates.
Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates
or Subordinated Notes. If any mutilated Trust Certificate or Subordinated Note
is surrendered to the Certificate Registrar, or if the Certificate Registrar
receives evidence to its satisfaction of the destruction, loss or theft of any
Trust Certificate or Subordinated Note and there is delivered to the
Certificate Registrar and the Owner Trustee such security or indemnity as may
be required by them to save each of them harmless, then (and in the case of the
Trust Certificates, in the absence of notice that such Trust Certificate has
been transferred to or is in the possession of a third party purchaser),
provided that the requirements of Section 8-405 of the UCC are met, the Owner
Trustee on behalf of the Issuer shall execute and the Authenticating Agent
shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Trust Certificate or Subordinated Note, a
new Trust Certificate or Subordinated Note of like tenor and denomination. In
connection with the issuance of any new Trust Certificate or Subordinated Note
under this Section, the Owner Trustee or the Certificate Registrar may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection therewith. Any duplicate Trust Certificate
issued pursuant to this Section shall constitute conclusive evidence of an
ownership interest in the Issuer, and any duplicate Subordinated Note issued
pursuant to this Section shall constitute conclusive evidence of an additional
contractual obligation of the Issuer, in each case as if originally issued,
whether or not the lost, stolen or destroyed Trust Certificate or Subordinated
Note shall be found at any time.
Section 3.06. Persons Deemed Trust Certificateholders or Subordinated
Noteholder. Prior to due presentation of a Trust Certificate for registration
of transfer, the Owner Trustee, the Certificate Registrar, any Paying Agent and
any of their respective agents may treat the Person in whose name any Trust
Certificate or Subordinated Note is registered in the Certificate Register as
the owner of such Trust Certificate or Subordinated Note for the purpose of
receiving distributions pursuant to Section 5.02 and for all other purposes
whatsoever, and none of the Owner Trustee, the Certificate Registrar, any
Paying Agent or any of their respective agents shall be affected by any notice
to the contrary.
Section 3.07. Access to List of Trust Certificateholders' Names and
Addresses. The Owner Trustee shall furnish or cause to be furnished to the
Administrative Agent and the Transferor, or to the Indenture Trustee, as the
case may be, within 15 days after receipt by the Owner Trustee of a request
therefor from the Administrative Agent, the Transferor or the Indenture Trustee
in writing, a list, in such form as the requesting party may reasonably
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request, of the names and addresses of the Trust Certificateholders as of the
most recent Record Date. If (i) two or more Trust Certificateholders or (ii)
one or more Trust Certificateholders evidencing not less than 25% of the
Certificate Balance apply in writing to the Owner Trustee, and such application
states that the applicants desire to communicate with other Trust
Certificateholders with respect to their rights under this Agreement or under
the Trust Certificates and such application is accompanied by a copy of the
communication that such applicants propose to transmit, then the Owner Trustee
shall, within five Business Days after the receipt of such application, afford
such applicants access during normal business hours to the current list of
Trust Certificateholders. Each Trust Certificateholder, by receiving and
holding a Trust Certificate, shall be deemed to have agreed not to hold either
the Transferor, the Owner Trustee or the Indenture Trustee, as the case may be,
accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.
Section 3.08. Maintenance of Office or Agency. The Owner Trustee shall
maintain in The Borough of Manhattan, The City of New York, an office or
offices or agency or agencies where Trust Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Owner Trustee in respect of the Trust Certificates and the other Basic
Documents to which the Issuer is a party may be served. The Owner Trustee
initially designates The Chase Manhattan Bank, 55 Water Street, New York, New
York 10041, as its office for such purposes. The Owner Trustee shall give
prompt written notice to the Transferor and the other Trust Certificateholders
of any change in the location of the Certificate Register or any such office or
agency.
Section 3.09. Appointment of Paying Agent. The Paying Agent shall make
distributions to Trust Certificateholders and to the Subordinated Noteholder
pursuant to Section 5.02, and shall report the amounts of such distributions to
the Owner Trustee. Any Paying Agent shall have the revocable power to withdraw
funds from the Certificate Distribution Account for the purpose of making the
distributions referred to above. The Paying Agent initially shall be The Chase
Manhattan Bank. The Owner Trustee may revoke such power and remove the Paying
Agent if the Owner Trustee determines in its sole discretion that the Paying
Agent has failed to perform its obligations under this Agreement in any
material respect. Any co-paying agent chosen by the Transferor and acceptable
to the Owner Trustee shall also be a Paying Agent. Each Paying Agent may resign
upon 30 days' written notice to the Owner Trustee. In the event that a Paying
Agent may no longer act as Paying Agent, the Owner Trustee shall appoint a
successor to act as Paying Agent (which shall be a bank or trust company). The
Owner Trustee shall cause such successor Paying Agent or any additional Paying
Agent appointed by the Owner Trustee to execute and deliver to the Owner
Trustee an instrument in which such successor Paying Agent or additional Paying
Agent shall agree with the Owner Trustee that as Paying Agent, such successor
Paying Agent or additional Paying Agent shall hold all sums, if any, held by it
for payment to the Subordinated Noteholder or the Trust Certificateholders in
trust for the benefit of the Subordinated Noteholder or the Trust
Certificateholders entitled thereto until such sums are paid to the Transferor
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or such Trust Certificateholders. The Paying Agent shall return all unclaimed
funds to the Owner Trustee and upon removal of a Paying Agent such Paying Agent
shall also return all funds in its possession to the Owner Trustee. The
provisions of Sections 7.01, 7.03, 7.04 and 8.01 shall apply to the Owner
Trustee also in its role as Paying Agent, for so long as the Owner Trustee
shall act as Paying Agent and, to the extent applicable, to any other paying
agent appointed hereunder.
Section 3.10. Ownership of Transferor Trust Certificate and
Subordinated Notes.
(a) On the Closing Date, the Transferor shall acquire and retain
beneficial and record ownership of the Transferor Trust Certificate and the
Subordinated Notes. Except as set forth in the Basic Documents, any attempted
transfer of the Transferor Trust Certificate by the Transferor shall be null
and void. Notwithstanding the foregoing, upon a dissolution or termination of
the Transferor, the Trust Certificates held by it shall be distributed to Ryder
without regard to the provisions of Section 3.02. The Owner Trustee shall cause
the Transferor Trust Certificate to bear a legend stating "THIS TRUST
CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN THE EVENT OF THE DISSOLUTION,
TERMINATION OR BANKRUPTCY OF RYDER FUNDING LP WHEN IT IS HOLDER HEREOF, AND ANY
TRANSFER IN VIOLATION OF THIS PROVISION SHALL BE NULL AND VOID".
(b) On the Closing Date, the Transferor shall acquire beneficial and
record ownership of the entire initial principal amount of the Subordinated
Notes. On and after the Closing Date, the Transferor shall be required to
retain beneficial and record ownership of the Subordinated Notes. Any attempted
transfer of the Subordinated Notes shall be null and void, except as permitted
under the Basic Documents. Notwithstanding the foregoing, upon a dissolution or
termination of the Transferor, the Subordinated Notes shall be distributed to
Ryder without regard to the provisions of Section 3.02.
Section 3.11. Trust Certificates held by Issuer, Transferor or their
Affiliates. Any Trust Certificates owned by the Issuer, the Transferor or any
of their respective Affiliates shall be entitled to the benefits under this
Agreement equally and proportionately to the benefits afforded other owners of
the Trust Certificates, except that such Trust Certificates shall be deemed not
to be outstanding for the purpose of determining whether the requisite
percentage of Securityholders have given any request, demand, authorization,
direction, notice, consent or other action under the Basic Documents (other
than the commencement by the Issuer of a voluntary proceeding in bankruptcy).
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ARTICLE FOUR
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice to Trust Certificateholders with Respect to
Certain Matters. Subject to the provisions and limitations of Section 4.04,
with respect to the following matters, the Owner Trustee shall not take action
unless the Owner Trustee has notified the Trust Certificateholders and the
Rating Agencies in writing of the proposed action at least 30 days before the
taking of such action and Trust Certificateholders representing at least 25% of
the Certificate Balance have not notified the Owner Trustee in writing prior to
the 30th day after such notice is given that such Trust Certificateholders have
withheld consent or provided alternative direction:
(a) the initiation of any claim or lawsuit by the Issuer and the
compromise of any action, claim or lawsuit brought by or against the
Issuer (other than an action brought by the Administrative Agent on
behalf of the Origination Trust and Persons having interests in the
1999-A SUBI Certificates to collect amounts owed under a 1999-A Lease
or in respect of a 1999-A Vehicle);
(b) the election by the Issuer to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed
under the Business Trust Statute);
(c) the amendment of the Indenture in circumstances where the
consent of any Senior Noteholder is required;
(d) the amendment of the Indenture in circumstances where the
consent of any Senior Noteholder is not required and such amendment
materially and adversely affects the interests of the Trust
Certificateholders;
(e) the amendment of any other Basic Document unless the Owner
Trustee is furnished an Opinion of Counsel to the effect that such
amendment does not materially and adversely affect the interests of
the Trust Certificateholders;
(f) the amendment, change or modification of the Issuer
Administration Agreement, except to cure any ambiguity or to amend or
supplement any provision in a manner or add any provision that would
not materially adversely affect the interests of the Trust
Certificateholders; or
(g) the appointment of a successor Owner Trustee or Indenture
Trustee.
Section 4.02. Action by Trust Certificateholders with Respect to
Certain Matters. Subject to the provisions and limitations of Section 4.04, to
the extent the Owner Trustee or the Issuer is deemed to be the Holder of the
99% 1999-A Vehicle SUBI Certificate pursuant to the SUBI Supplement, the Owner
Trustee or Issuer, as the case may be, shall take such actions as directed in
writing by Trust Certificateholders holding Trust Certificates evidencing an
interest of at least 66-2/3% of the Certificate Balance; provided, however, that
so long as the Lien of the Indenture is outstanding, such direction shall be
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subject to the consent of the Indenture Trustee. The Owner Trustee may not,
except upon the occurrence of an Administrative Agent Default or a Maintenance
Provider Default subsequent to the payment in full of the Senior Notes and in
accordance with the written directions of Trust Certificateholders holding 66?%
of the Certificate Balance, remove the Administrative Agent or the Maintenance
Provider, as the case may be, with respect to the 1999-A SUBI Assets or appoint
a successor Administrative Agent or Maintenance Provider, as the case may be,
with respect thereto.
Section 4.03. Action by Owner Trustee with Respect to Bankruptcy. The
Owner Trustee shall not have the power to commence a voluntary proceeding in
bankruptcy with respect to the Issuer except in accordance with Section 12.08
hereof.
Section 4.04. Restrictions on Trust Certificateholders' Power. The
Trust Certificateholders shall not direct the Owner Trustee to take or refrain
from taking any action if such action or inaction would be contrary to any
obligation of the Issuer or the Owner Trustee under this Agreement or any of
the other Basic Documents or would be contrary to the purpose of the Issuer as
set forth in Section 2.03, nor shall the Owner Trustee be obligated to follow
any such direction, if given.
Section 4.05. Majority Control. Except as expressly provided herein,
any action that may be taken by the Trust Certificateholders under this
Agreement may be taken by the Trust Certificateholders holding not less than a
majority of the Certificate Balance. Except as expressly provided herein, any
written notice of the Trust Certificateholders delivered pursuant to this
Agreement shall be effective if signed by Trust Certificateholders holding not
less than a majority of the Certificate Balance at the time of delivery of such
notice.
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ARTICLE FIVE
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Establishment of Certificate Distribution Account and
Reserve Fund.
(a) The Owner Trustee, for the benefit of the Trust Certificateholders
and the Subordinated Noteholder, shall establish and maintain an Eligible
Account with and in the name of the Owner Trustee which shall be designated the
"Certificate Distribution Account". The Certificate Distribution Account shall
be held in trust for the benefit of the Trust Certificateholders and the
Subordinated Noteholder, and shall bear a designation clearly indicating that
the funds deposited therein are held for the benefit of the Trust
Certificateholders and the Subordinated Noteholder.
The Owner Trustee shall possess all right, title and interest in all
funds on deposit from time to time in the Certificate Distribution Account and
in all proceeds thereof. Except as otherwise provided herein, the Certificate
Distribution Account shall be under the sole dominion and control of the Owner
Trustee for the benefit of the Trust Certificateholders and the Subordinated
Noteholder. If at any time the Certificate Distribution Account ceases to be an
Eligible Account, the Owner Trustee (or the Transferor 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 ten Business Days following
notification of such occurrence (or such longer period, not to exceed 30
calendar days, as to which each Rating Agency may consent), establish a new
Certificate Distribution Account as an Eligible Account and shall transfer any
cash or investments to such new Certificate Distribution Account.
(b) The Transferor shall establish and maintain an Eligible Account
(initially at U.S. Bank) in the name of the Indenture Trustee until the
Outstanding Amount of the Senior Notes is reduced to zero, and thereafter, in
the name of the Owner Trustee, which is designated as the "Reserve Fund." The
Reserve Fund shall be held for the benefit of the Securityholders, and shall
bear a designation clearly indicating that the funds on deposit therein are
held for the benefit of the Securityholders.
The Reserve Fund shall be under the sole dominion and control of the
Indenture Trustee until the Outstanding Amount (as defined in the Indenture) of
the Senior Notes has been reduced to zero, and thereafter under the sole
dominion and control of the Owner Trustee. On the Closing Date, the Transferor
shall cause the Initial Deposit to be deposited into the Reserve Fund from the
net proceeds of the sale of the Notes and the Trust Certificates. The
Transferor hereby acknowledges that the Initial Deposit and all other Reserve
Fund Property, including investment earnings thereon, are owned directly by it
pending application thereof to the Secured Obligations or release to the
Transferor or its designee pursuant to Section 8.04(c) of the Indenture or
Section 5.02 hereof, as applicable. The Transferor hereby agrees to treat the
same as its assets (and earnings) for federal income tax and other purposes.
All deposits to and withdrawals from the Reserve Fund shall be made only upon
the terms and conditions of the Basic Documents.
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(c) Each of the Transferor and the Issuer agrees to take or cause to
be taken such further actions, to execute, deliver and file or cause to be
executed, delivered and filed such further documents and instruments
(including, without limitation, the Control Agreement or any UCC financing
statements) as may be determined to be reasonably necessary by the Transferor,
in order to perfect the interests created by Section 5.01 (b) hereof and
otherwise fully to effectuate the purposes, terms and conditions of this
Section. The Transferor (or the Administrator on behalf of the Transferor)
shall:
(i) promptly execute, deliver and file any financing statements,
amendments, continuation statements, assignments, certificates and
other documents with respect to such interests and perform all such
other acts as may be necessary in order to perfect or to maintain the
perfection of the Issuer's security interest in the Reserve Fund
Property; and
(ii) make the necessary filings of financing statements or
amendments thereto within five days after the occurrence of any of the
following (and promptly notify the Issuer and the Owner Trustee of
each such filing): (A) any change in the Transferor's corporate name
or any trade name, (B) any change in the location of its chief
executive office or principal place of business or (C) any merger or
consolidation or other change in its identity or corporate structure.
Section 5.02. Application of Trust Funds.
(a) Until the Senior Note Outstanding Amount has been reduced to zero,
on each Payment Date, the Paying Agent (or the Owner Trustee, if there is no
Paying Agent) shall pay, to the extent of funds available, the amount required
to be deposited by the Origination Trustee and by the Indenture Trustee into
the Certificate Distribution Account pursuant to Section 8.04 of the Indenture
for the payment of interest on and, after the payment in full of the Notes,
principal of the Trust Certificates on such Payment Date, pro rata to the Trust
Certificateholders of record at the close of business on the Record Date with
respect to such Payment Date. Pursuant to Section 5.02(f) all interest and
principal distributable in respect of the Subordinated Notes for the related
Accrual or Collection Period shall be deposited directly to the Reserve Fund.
(b) On and after the date on which the Senior Note Outstanding Amount
has been reduced to zero, pursuant to the Indenture and the Control Agreement,
dominion and control over the Reserve Fund shall be transferred to the Owner
Trustee. On each Payment Date thereafter, all amounts distributable to the
Trust Certificateholders and the Subordinated Noteholder from the Reserve Fund
shall be distributed by the Owner Trustee in the order and priority set forth
in Section 8.04(b) of the Indenture and the Owner Trustee shall comply with
Section 8.04(c) and 8.05(a) of the Indenture.
On the Payment Date on which the Certificate Balance has been reduced
to zero, the Owner Trustee shall release to the Transferor all of the Issuer's
right, title, and interest in, to and under the Reserve Fund Property. In
addition, on or following the Payment Date on which the Certificate Balance has
been reduced to zero, the Transferor may direct the Owner Trustee to distribute
to it the remaining assets of the Issuer.
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(c) On each Payment Date, the Owner Trustee shall send to each Trust
Certificateholder and to the Subordinated Noteholder a report (the
"Distribution Statement") provided by the Administrative Agent based on
information supplied by the Administrative Agent to the Owner Trustee in the
Payment Date Certificate pursuant to Section 8.03 of the Indenture that shall
include the following information:
(i) the amount of SUBI Collections for the related Collection
Period and the amounts allocable to the 99% 1999-A SUBI Certificates
and the 1% 1999-A SUBI Certificates;
(ii) the Certificate Balance on the immediately preceding Payment
Date, or if the current Payment Date is the first Payment Date, on the
Closing Date;
(iii) the aggregate amount of interest accrued and paid on the
Trust Certificates and the Subordinated Notes during the related
Accrual Period;
(iv) the aggregate amount of principal paid with respect to the
Trust Certificates and the Subordinated Notes on such Payment Date,
the Principal Shortfall Amount, if any, and the Optimal Principal
Distribution Amount;
(v) the Outstanding Amount of the Subordinated Notes and the
Certificate Balance on the day immediately preceding such Payment
Date;
(vi) the Subordinated Note Factor and the Certificate Factor
(after giving effect to payments made on such Payment Date);
(vii) the Available Funds deposited into the SUBI Collection
Account, including amounts with respect to each of items (i) through
(iv) of the definition thereof;
(viii) the Reserve Fund Deposit Amount and the Reserve Fund
Requirement, each as of the beginning and end of the related
Collection Period;
(ix) the Reserve Fund Draw Amount, if any;
(x) the Administration Fee for the related Collection Period; and
(xi) the amount of Residual Value Losses for the immediately
preceding Collection Period.
The information required to be delivered by such Distribution
Statement may be included with such other information or reports furnished by
the Administrative Agent to the Owner Trustee in connection with the making of
payments pursuant to the other Basic Documents.
(d) In the event that any withholding tax is imposed on the Issuer's
payment (or, if the Issuer is treated as a partnership for federal income tax
purposes, allocations of income) to a Trust Certificateholder, such tax shall
reduce the amount otherwise distributable to such Trust Certificateholder in
accordance with this Section. The Owner Trustee is hereby authorized and
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directed to retain from amounts otherwise distributable to such Trust
Certificateholders, sufficient funds for the payment of any withholding tax
that is legally owed by the Issuer (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
Trust Certificateholder shall be treated as cash distributed to such Trust
Certificateholders, at the time it is withheld by the Issuer for remittance to
the appropriate taxing authority. If the Owner Trustee determines that there is
a possibility that withholding tax is payable with respect to a distribution,
the Owner Trustee may in its sole discretion withhold such amounts in
accordance with this Section. In the event that a Trust Certificateholder
wishes to apply for a refund of any such withholding tax, the Owner Trustee
shall reasonably cooperate with such Trust Certificateholder in making such
claim so long as such Trust Certificateholder agrees to reimburse the Owner
Trustee for any out-of-pocket expenses incurred.
(e) Subject to Section 6.07 of the Indenture and 6.01 hereof, as the
case may be, neither the Indenture Trustee nor the Owner Trustee, as the case
may be, shall in any way be held liable by reason of any insufficiency in the
Reserve Fund resulting from any loss on any Permitted Investment included
therein, except for losses attributable to the Indenture Trustee's or Owner
Trustee's, as the case may be, failure to make payments on any such Permitted
Investments issued by the Indenture Trustee or Owner Trustee, as the case may
be, in its commercial capacity as principal obligor and not as trustee, in
accordance with their terms.
(f) In order to assure that sufficient amounts are available to make
the payments to Securityholders pursuant to Section 8.04 of the Indenture and
this Section (collectively, the "Secured Obligations") the Transferor:
(i) hereby pledges and assigns and grants a security interest in
all of its right, title and interest in the Subordinated Notes to the
Issuer, to secure the Secured Obligations;
(ii) acknowledges that the Issuer has assigned or will assign its
security interest in the Subordinated Notes to the Indenture Trustee
to secure payment of the Senior Notes and directs the Issuer to
deliver such Subordinated Notes directly to the custody unit of the
Indenture Trustee located in New York in order to perfect the security
interest therein;
(iii) agrees that on each Payment Date, all payments of interest
on and principal of the Subordinated Notes shall be deposited directly
into the Reserve Fund; and
(iv) hereby pledges and assigns and grants a security interest in
all of its right, title and interest in the Reserve Fund Property to
the Issuer, to secure the Secured Obligations.
Section 5.03. Method of Payment. Subject to Section 9.01(c) respecting
the final payment upon retirement of each Trust Certificateholder,
distributions required to be made to Trust Certificateholders on any Payment
Date shall be made to each Trust Certificateholder of record on the related
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Record Date by check mailed to the addresses of such Securityholders as they
appear on the Certificate Register. As set forth in Section 5.02(f), payments
to be made to the Subordinated Noteholder shall be deposited directly in the
Reserve Fund. Notwithstanding the foregoing, the final payment on the Trust
Certificates or the Subordinated Notes shall be made only upon presentation and
surrender of such Trust Certificates or Subordinated Notes at the office or
agency specified in the notice of final payment to the Trust Certificateholders
or the Subordinated Noteholder. The Owner Trustee or a paying agent shall, upon
receipt of at least 45 days' notice from the Issuer or the Administrator as set
forth in the Indenture, provide such notice to the Subordinated Noteholder and
to Trust Certificateholders of record not more than 30 days and not less than
15 days prior to the date on which such final payment is expected to occur.
Section 5.04. Accounting and Reports.
(a) The Owner Trustee shall, based on information provided by the
Transferor, (i) maintain (or cause to be maintained) the books of the Issuer on
a calendar year basis on the accrual method of accounting (except as required
by Article Eleven), (ii) deliver to each Trust Certificateholder and the
Subordinated Noteholder not later than the latest date permitted by law (A) a
statement of the amounts provided for in Section 8.04 of the Indenture and (B)
such information as may be required by the Code and applicable Treasury
Regulations with respect to instruments such as the Trust Certificates or the
Subordinated Notes, as the case may be, that is consistent with the position
that the Trust Certificates (other than the Transferor Trust Certificate) will
be treated as debt for federal income tax and state income and franchise tax
purposes and (iii) in addition to the Owner Trustee's rights under Section
5.02, take such action as instructed by the Transferor, as holder of the
Transferor Trust Certificate, to collect or cause to be collected and paid over
to applicable authorities any withholding tax as described in and in accordance
with Section 5.02 and Article Eleven with respect to income or distributions to
Trust Certificateholders. The Owner Trustee shall make all elections pursuant
to Article Eleven as directed by the Transferor.
(b) The Transferor shall maintain such books and records, and shall
prepare and file such reports and returns, as are required pursuant to Sections
2.10 and 5.02.
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ARTICLE SIX
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority. The Owner Trustee shall administer
the Issuer in the interest of the Trust Certificateholders, subject to the Lien
of the Indenture Trustee and the obligations of the Issuer under the
Subordinated Notes, in accordance with the Basic Documents. Subject to the
provisions and limitations of Sections 2.03 and 2.06, the Owner Trustee is
authorized and directed to execute and deliver on behalf of the Issuer the
Basic Documents to which the Issuer 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 Issuer is to be a party, in each case in such form as the
Transferor shall approve as evidenced conclusively by the Owner Trustee's
execution thereof and the Transferor's execution of this Agreement, and to
direct the Indenture Trustee to authenticate and deliver Senior Notes in the
aggregate principal amount not to exceed $[______________] (except as otherwise
contemplated by Section 3.05). In addition to the foregoing, the Owner Trustee
is authorized to take all actions required of the Issuer pursuant to the Basic
Documents. The Owner Trustee is further authorized from time to time to take
such action on behalf of the Issuer as is permitted by the Basic Documents and
that the Administrative Agent or the Administrator recommends with respect to
the Basic Documents, except to the extent this Agreement expressly requires the
consent of the Trust Certificateholders or the Subordinated Noteholder for such
action.
Section 6.02. General Duties. Subject to the provisions and
limitations of Sections 2.03 and 2.06, 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 the Basic Documents to which the Issuer is a party and
to administer the Issuer in the interest of the Trust Certificateholders,
subject to the Lien of the Indenture Trustee and to the obligations of the
Issuer under the Subordinated Notes, and in accordance with provisions of the
Basic Documents. Notwithstanding the foregoing, the Owner Trustee shall be
deemed to have discharged its duties and responsibilities hereunder and under
the other Basic Documents to the extent the Administrator has agreed in the
Issuer Administration Agreement to perform any act or to discharge any duty of
the Owner Trustee hereunder or under any other Basic Document, and the Owner
Trustee shall not be held liable for the default or failure of the
Administrator to carry out its obligations under the Issuer Administration
Agreement.
Section 6.03. Action Upon Instruction.
(a) Subject to Article Four, the Transferor, as holder of the
Transferor Trust Certificate, may by written instruction direct the Owner
Trustee in the administration of the Issuer subject to, and in accordance with,
the terms of the Basic Documents; provided that such instruction shall not, as
evidenced by an Opinion of Counsel, materially adversely affect any
Securityholder.
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(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, is contrary
to the terms hereof or of any other Basic Document or is otherwise contrary to
law or any obligation of the Owner Trustee or the Issuer.
(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or any
other Basic Document, the Owner Trustee shall promptly give notice (in such
form as shall be appropriate under the circumstances) to the Trust
Certificateholders 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 Trust Certificateholders holding not less than
a majority of the Certificate Balance, 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 ten days of such notice (or within such
shorter period of time as reasonably may be specified in such notice as 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 Trust
Certificateholders, and shall have no liability to any Person for such action
or inaction.
(d) In the event 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 or any other Basic Document permits any determination by the Owner
Trustee or is silent or is incomplete as to the course of action 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 Trust Certificateholders requesting instruction and, to
the extent the Owner Trustee acts or refrains from acting in good faith in
accordance with any such instruction received from Trust Certificateholders
holding not less than a majority of the Certificate Balance and in accordance
with Sections 6.04 and 6.05, 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 ten days of such notice (or within such
shorter period of time as reasonably may be specified in such notice or as 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 Trust Certificateholders, and shall have no liability to any Person for
such action or inaction.
(e) Notwithstanding the foregoing, the right of the Transferor or the
Trust Certificateholders to take any action affecting the Owner Trust Estate
shall be subject to the rights of the Indenture Trustee under the Indenture.
Section 6.04. No Duties Except as Specified. The Owner Trustee shall
not be required to perform any of the obligations of the Issuer under this
Agreement or the other Basic Documents that are required to be performed by (i)
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the Administrative Agent under the Administration Agreement or the SUBI
Supplement, (ii) the Transferor under this Agreement, the SUBI Certificate
Transfer Agreement, the Back-Up Security Agreement or the Program Operating
Lease, (iii) the Administrator under the Issuer Administration Agreement or
(iv) the Indenture Trustee under the Indenture. 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 Issuer is a
party, except as expressly provided by the terms of this Agreement or in any
document or written instruction received by the Owner Trustee pursuant to
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 ownership or security interest in the Owner Trust Estate
or to record this Agreement or any other Basic Document. The Owner Trustee
nevertheless agrees that it will, at its own cost and expense, promptly take
all action as may be necessary to discharge any Liens (other than the Lien of
the Indenture) on any part of the Owner Trust Estate that result from actions
by or claims against the Owner Trustee in its individual capacity that are not
related to the ownership or the administration of the Owner Trust Estate.
Section 6.05. No Action Unless Specifically Authorized. The Owner
Trustee shall not manage, control, use, sell, dispose of or otherwise deal with
any part of the Owner Trust Estate except in accordance with (i) the powers
granted to and the authority conferred upon the Owner Trustee pursuant to this
Agreement, (ii) the other Basic Documents to which the Issuer or the Owner
Trustee is a party and (iii) any document or instruction delivered to the Owner
Trustee pursuant to Section 6.03. In particular, the Owner Trustee shall not
transfer, sell, pledge, assign or convey the 99% 1999-A Vehicle SUBI
Certificate except as specifically required or permitted by the Basic
Documents.
Section 6.06. Restrictions. The Owner Trustee shall not take any
action (i) that is contrary to the purposes of the Issuer set forth in Section
2.03 or (ii) that, to the actual knowledge of the Owner Trustee, would (a)
affect the treatment of the Senior Notes as debt for federal income tax
purposes, (b) be deemed to cause a taxable exchange of the Senior Notes for
federal income tax purposes or (c) cause the Issuer, the Transferor or the
Origination Trust or any portion thereof to be taxable as an association (or a
publicly traded partnership) taxable as a corporation for federal or state
income or franchise tax purposes. The Trust Certificateholders, the
Subordinated Noteholder and the Transferor shall not direct the Owner Trustee
to take action that would violate the provisions of this Section. The Owner
Trustee may not (i) initiate or settle any claim or lawsuit involving the
Issuer (unless brought by the Administrative Agent to collect amounts owed
under a Specified Lease), (ii) amend this Agreement where Trust
Certificateholder consent is required, (iii) amend this Agreement where Trust
Certificateholder consent is not required if such amendment materially
adversely affects the Trust Certificateholders or (iv) amend any Basic Document
other than this Agreement if such amendment materially adversely affects the
Trust Certificateholders, unless (a) the Owner Trustee provides 30 days'
written notice thereof to the Trust Certificateholders and each Rating Agency
and (b) Trust Certificateholders holding at least 25% of the Certificate
Balance do not object in writing to any such proposed amendment within 30 days
of such notice. Notwithstanding anything herein to the contrary, the
Transferor, the Administrative Agent and their respective Affiliates may
maintain normal commercial banking relationships with the Owner Trustee and its
Affiliates.
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ARTICLE SEVEN
CONCERNING THE 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 monies actually received by it
constituting part of the Owner Trust Estate upon the terms of the Basic
Documents to which the Issuer or the Owner Trustee is a party. 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, bad faith or negligence or (ii) in the case of the inaccuracy of
any representation or warranty contained in Section 7.03 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 in
judgment of a responsible officer of the Owner Trustee;
(b) the Owner Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in accordance with the
instructions of any Trust Certificateholder, the Transferor (as holder
of the Subordinated Notes), the Indenture Trustee, the Transferor, the
Administrator or the Administrative Agent;
(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;
(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 or the Trust
Certificates;
(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 Transferor 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
other Basic Documents, other than the execution of and the certificate
of authentication on the Trust Certificates and the Subordinated
Notes, and the Owner Trustee shall in no event be deemed to have
assumed or incurred any liability, duty or obligation to any
Securityholder or any third party dealing with the Issuer or the Owner
Trust Estate, other than as expressly provided for herein and in the
other Basic Documents;
(f) the Owner Trustee shall not be liable for the misfeasance,
malfeasance or nonfeasance of the Administrative Agent, the
Administrator, the Transferor or the Indenture Trustee under any of
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the Basic Documents or otherwise, and the Owner Trustee shall have no
obligation or liability to perform the obligations of the Issuer or
the Transferor under this Agreement or the Basic Documents that are
required to be performed by the Administrative Agent under the
Administration Agreement or the SUBI Trust Agreement, the Transferor
under the Program Operating Lease, the Administrator under the Issuer
Administration Agreement or the Indenture Trustee under the Indenture;
and
(g) the Owner Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Agreement, or to
institute, conduct or defend any litigation under this Agreement or
otherwise or in relation to this Agreement or any other Basic
Document, at the request, order or direction of any of the Trust
Certificateholders or the Subordinated Noteholder unless such Trust
Certificateholders or the Subordinated Noteholder have offered to the
Owner Trustee security or indemnity satisfactory to it against the
Expenses 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 bad faith, negligence or willful misconduct in the
performance of any such act.
Section 7.02. Furnishing of Documents. The Owner Trustee shall furnish
to any Trust Certificateholder or the Subordinated Noteholder promptly upon
receipt of a written request by such Trust Certificateholder or the
Subordinated Noteholder (at the expense of the requesting Trust
Certificateholder or the Subordinated Noteholder) therefor, duplicates or
copies of all reports, notices, requests, demands, certificates 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 Transferor, the Trust Certificateholders and the
Subordinated Noteholder, that:
(a) It is a banking corporation duly organized and validly
existing in good standing under the laws of the State of Delaware. It
has all requisite corporate power and authority to execute, deliver
and perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize the
execution and delivery by it of this Agreement, and this Agreement
will be executed and delivered by one of its officers who is duly
authorized to execute and deliver this Agreement on its behalf.
(c) Neither the execution nor the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby nor compliance by it with any of the terms or provisions hereof
will contravene any federal or Delaware 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
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any of its properties may be bound or result in the creation or
imposition of any Lien, charge or encumbrance on the Owner Trust
Estate resulting from actions by or claims against the Owner Trustee
individually that are unrelated to this Agreement or the other Basic
Documents.
(d) This Agreement has been duly executed and delivered by it and
constitutes the legal, valid and binding agreement of it, enforceable
against the Owner Trustee in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights in general and by general principles of equity,
regardless of whether such enforceability is considered in a
proceeding in equity or at law.
Section 7.04. Reliance; Advice of Counsel.
(a) The Owner Trustee may rely upon, shall be protected in relying
upon and shall incur no liability to anyone in acting or refraining from 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 Board Resolution or documents of
any other governing body of any corporate party as conclusive evidence that
such Board Resolution or other document has been duly adopted by such body and
that the same is in full force and effect. As to any fact or matter the method
of the determination of which is not specifically prescribed herein, the Owner
Trustee may for all purposes hereof rely on a certificate, signed by the
president, any vice president, the treasurer, any assistant treasurer or any
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 and 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 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 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, in accepting the trusts hereby created, Chase Manhattan Bank
Delaware 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 Basic Document shall
look only to the Owner Trust Estate for payment or satisfaction thereof.
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Section 7.06. Owner Trustee Not Liable for Trust Certificates or
Subordinated Notes. The recitals contained herein and in the Trust Certificates
and the Subordinated Notes (other than the signature of the Owner Trustee and
the certificate of authentication on the Trust Certificates and the
Subordinated Notes and its representations and warranties in Section 7.03)
shall be taken as the statements of the Transferor 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, any
other Basic Document or the Trust Certificates or the Subordinated Notes (other
than the signature of the Owner Trustee and the certificate of authentication
on the Trust Certificates and the Subordinated Notes) or the Senior Notes or
any offering document relating to either of them. The Owner Trustee shall at no
time have any responsibility or liability for or with respect to the legality,
validity or enforceability of any Basic Document to which the Owner Trustee is
to be a party (except for enforceability against the Owner Trustee), or the
perfection and priority of any security interest created by or under any Basic
Document, 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 Trust Certificateholders or to the
Subordinated Noteholder under this Agreement or the Senior Noteholders under
the Indenture, the validity of the transfer of the 99% 1999-A Vehicle SUBI
Certificate or the pledge of the 99% 1999-A Lease SUBI Certificate to the
Issuer or of the lease by the Issuer of the 99% 1999-A Vehicle SUBI Certificate
to the Transferor pursuant to the Program Operating Lease, or for the
compliance by the Transferor, the Administrator or the Administrative Agent
with any warranty or representation made under any Basic Document or for the
accuracy of any such warranty or representation or for any action of the
Administrator, the Administrative Agent or the Indenture Trustee taken in the
name of the Owner Trustee.
Section 7.07. Owner Trustee May Own Trust Certificates and Notes. The
Owner Trustee in its individual or any other capacity may become the owner or
pledgee of Trust Certificates or Notes and may deal with the Transferor, the
Administrative Agent, the Administrator, the Indenture Trustee and their
respective Affiliates, in banking transactions with the same rights as it would
have if it were not the Owner Trustee.
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ARTICLE EIGHT
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Compensation and Indemnification.
(a) The Owner Trustee and any Paying Agent shall receive as
compensation from the Administrator for its services hereunder such fees as
have been separately agreed upon before the date hereof between the Transferor
or the Administrator and the Owner Trustee or the Paying Agent. The Transferor,
as holder of the Transferor Trust Certificate, shall be liable as primary
obligor for, and shall indemnify the Owner Trustee and its successors, assigns,
agents, servants, officers and employees or any Paying Agent (collectively, the
"Indemnified Parties") from and against, any Expenses that 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 the 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
Transferor, as holder of the Transferor Trust Certificate and the Subordinated
Notes, shall not be liable for or required to indemnify the Owner Trustee from
and against Expenses arising or resulting from any of the matters described in
the second clause of the third sentence of Section 7.01 or for any income taxes
on any fees payable to the Owner Trustee or any Paying Agent as set forth in
Section 2.07. 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
will be sought pursuant to this Section, the Owner Trustee's choice of legal
counsel shall be subject to the approval of the Transferor, which approval
shall not be unreasonably withheld. Neither the Transferor nor the
Administrator shall make any claim upon the Owner Trust Estate for the payment
of such Expenses.
(b) Notwithstanding the foregoing, the Owner Trustee shall not be
liable for (i) any error of judgment made by an officer of the Owner Trustee,
(ii) any action taken or omitted to be taken in accordance with the
instructions of any Trust Certificateholder or the Subordinated Noteholder, the
Indenture Trustee, the Transferor, the Administrator or the Administrative
Agent, (iii) the interest on or principal of the Securities or (iv) the default
or misconduct of the Administrator, the Administrative Agent, the Transferor or
the Indenture Trustee.
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ARTICLE NINE
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement.
(a) This Agreement (other than Article Eight) and the Issuer shall
terminate and be of no further force or effect, (i) upon the final distribution
by the Owner Trustee of all funds or other property or proceeds of the Owner
Trust Estate in accordance with the terms of the Indenture and this Agreement
and (ii) at the times provided in Section 9.02 or 9.03. The bankruptcy,
liquidation, dissolution, or termination, death or incapacity of any Trust
Certificateholder, other than the Transferor, as holder of the Transferor Trust
Certificate, as described in Section 9.02 or 9.03, shall not (i) operate to
terminate this Agreement or the Issuer, (ii) entitle such Trust
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of all
or any part of the Issuer or Owner Trust Estate nor (iii) otherwise affect the
rights, obligations and liabilities of the parties hereto.
(b) Except as provided in Section 9.01(a), neither the Transferor nor
any other Trust Certificateholder shall be entitled to revoke or terminate the
Issuer.
(c) Notice of any termination of this Agreement pursuant to Section
9.01(a) shall be given by the Owner Trustee by letter to Trust
Certificateholders and the Subordinated Noteholder mailed within five Business
Days of receipt of notice of such termination from the Administrator, stating
(i) the Payment Date upon or with respect to which final payment of the Trust
Certificates and the Subordinated Notes shall be made upon presentation and
surrender of the Trust Certificates and the Subordinated Notes at the office of
the Paying Agent therein designated, (ii) the amount of any such final payment
and (iii) that the Record Date otherwise applicable to such Payment Date is not
applicable, payments being made only upon presentation and surrender of the
Trust Certificates and the Subordinated Notes at the office of the Paying Agent
therein specified. The Owner Trustee shall give such notice to the Certificate
Registrar (if other than the Owner Trustee) and the Paying Agent at the time
such notice is given to Trust Certificateholders and the Transferor. Upon
presentation and surrender of the Trust Certificates and the Subordinated
Notes, the Paying Agent shall cause to be distributed to Trust
Certificateholders and the Subordinated Noteholder (which amounts shall be
deposited into the Reserve Fund), amounts distributable on such Payment Date
pursuant to Section 5.02. The Owner Trustee shall promptly notify each Rating
Agency upon the final payment of the Trust Certificates.
(d) In the event that all of the Trust Certificateholders or the
Subordinated Noteholder shall not surrender their Trust Certificates or
Subordinated Notes for cancellation within six months after the date specified
in the above-mentioned written notice, the Owner Trustee shall give a second
written notice to the remaining Trust Certificateholders or the Subordinated
Noteholder to surrender their Trust Certificates or Subordinated Notes for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice, all of the Trust Certificates or Subordinated
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Notes shall not have been surrendered for cancellation, the Owner Trustee may
take appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Trust Certificateholders or the Subordinated Noteholder
concerning surrender of their Trust Certificates or Subordinated Notes, and the
cost thereof shall be paid out of the funds and other assets that shall remain
subject to this Agreement. Any funds remaining in the Issuer after exhaustion
of such remedies shall be distributed by the Owner Trustee to the
Administrator.
(e) Upon the winding up of the Issuer and its termination, the Owner
Trustee shall cause the Certificate of Trust to be cancelled by filing a
certificate of cancellation with the Secretary of State in accordance with
Section 3810 of the Business Trust Statute.
Section 9.02. Dissolution upon Bankruptcy of the Transferor. In the
event that a bankruptcy or insolvency shall occur with respect to the
Transferor, this Agreement and the Issuer shall terminate in accordance with
Section 9.01. Promptly after the occurrence of any bankruptcy, insolvency or
termination with respect to the Transferor, (i) the Transferor shall give the
Indenture Trustee, the Owner Trustee and the Rating Agencies written notice of
such event, (ii) the Owner Trustee shall, upon the receipt of such written
notice from the Transferor, give prompt written notice to the Trust
Certificateholders of the occurrence of such event, and (iii) the Indenture
Trustee shall, upon receipt of written notice of such event from the Owner
Trustee, give prompt written notice to the Senior Noteholders of the occurrence
of such event; provided, however, that any failure to give a notice required by
this sentence shall not prevent or delay, in any manner, a termination of the
Issuer pursuant to the first sentence of this Section. Upon the receipt of such
notice or actual knowledge of a termination pursuant to this Section, the Owner
Trustee shall promptly sell, or if the Lien of the Indenture is outstanding
shall direct the Indenture Trustee promptly to sell, the Owner Trust Estate
(other than amounts on deposit in the Distribution Accounts) in a commercially
reasonable manner and on commercially reasonable terms. In connection with any
such sale, the 1999-A SUBI Assets shall be distributed out of the Origination
Trust as provided in Section 12.05(b) of the SUBI Trust Agreement. The Owner
Trustee will have no liability with respect to the procedures of the Indenture
Trustee in connection with such sale or the sufficiency or adequacy of the
proceeds therefrom.
Section 9.03. Purchase of the 99% 1999-A Vehicle SUBI Certificate;
Redemption of the Subordinated Notes; Repayment of the Trust Certificates.
(a) The Transferor shall be permitted at its option (the "Optional
Purchase") to purchase the 99% 1999-A Vehicle SUBI Certificate from the Issuer
on any Payment Date if, either before or after giving effect to any payment of
principal required to be made on such Payment Date, the Senior Note Balance is
less than or equal to 10% of the Initial Securities Balance. The purchase price
for the 99% 1999-A Vehicle SUBI Certificate shall equal the Securities Balance,
together with accrued interest thereon up to but not including such related
Payment Date (the "Optional Purchase Price"), which amount shall be deposited
by the Transferor into the SUBI Collection Account on the Deposit Date related
to such Payment Date. If the Transferor exercises the Optional Purchase, the
Senior Notes shall be redeemed, the Trust Certificates shall be repaid and the
Subordinated Notes shall be redeemed, in each case in whole but not in part on
the related Payment Date, and thereupon the pledge of the 1999-A Lease SUBI
shall be discharged and released and the 99% 1999-A Lease SUBI Certificate
shall be returned to the Transferor.
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(b) Upon deposit of the Subordinated Note Redemption Price in the
Reserve Fund and the Repayment Price in the Certificate Distribution Account,
the Trust Certificates and the Subordinated Notes shall be due and payable on
the related Payment Date, upon furnishing of a notice complying with Section
9.03(c) to each Trust Certificateholder and the Subordinated Noteholder. The
Administrator or the Owner Trustee shall furnish each Rating Agency notice of
such repayment or redemption.
(c) Notice of repayment or redemption under Section 9.03(b) shall be
given by the Owner Trustee by facsimile or by first-class mail, postage
prepaid, transmitted or mailed at least 30 days prior to the related Payment
Date to each Trust Certificateholder or the Subordinated Noteholder,
respectively as of such date, at such Trust Certificateholder's or the
Transferor's address appearing in the Certificate Register.
All notices of redemption or repayment shall state:
(i) the related Payment Date for the repayment or redemption, as
the case may be;
(ii) the Repayment Price or Subordinated Note Redemption Price,
as the case may be;
(iii) the place where the Subordinated Notes to be redeemed or
the Trust Certificates to be repaid, as the case may be, are to be
surrendered for payment of the Subordinated Note Redemption Price or
the Repayment Price, respectively (which shall be the office or agency
of the Owner Trustee to be maintained as provided in Section 3.08);
and
(iv) that on the related Payment Date, the Repayment Price or the
Subordinated Note Redemption Price, as the case maybe, will become due
and payable upon each such Trust Certificate or Subordinated Note, as
the case may be, and that interest thereon shall cease to accrue from
and after the related Payment Date.
Notice of redemption of the Subordinated Notes and of repayment of the
Trust Certificates shall be given by the Owner Trustee in the name and at the
expense of the Issuer. Failure to give notice of redemption or repayment, as
the case may be, or any defect therein, to the Subordinated Noteholder or any
Trust Certificateholder shall not impair or affect the validity of the
repayment of any Trust Certificate or redemption of the Subordinated Notes.
(d) The Subordinated Notes to be redeemed shall, following notice of
redemption as required by Section 9.03(c), on the related Payment Date become
due and payable at the Subordinated Note Redemption Price and (unless the
Issuer shall default in the payment of the Subordinated Note Redemption Price)
no interest shall accrue on the Subordinated Note Redemption Price for any
period from and including the related Payment Date. The Trust Certificates to
be repaid shall, following notice of repayment as required by Section 9.03(c)
on the related Payment Date, become due and payable at the Repayment Price and
(unless the Issuer shall default in the payment of the Repayment Price) no
interest shall accrue on the Repayment Price for any period from and including
the related Payment Date.
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ARTICLE TEN
SUCCESSOR OWNER TRUSTEES AND
ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall (i) be a corporation satisfying the provisions of Section 3807(a)
of the Business Trust Statute; (ii) at all times be able and authorized to
exercise corporate trust powers; (iii) have a long-term debt rating of "A" or
higher or be otherwise acceptable to each Rating Agency; (iv) have combined
capital and surplus of at least $50,000,000; and (v) be subject to supervision
or examination by federal or state authorities. If the Owner Trustee 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 the Owner Trustee
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 Administrator, the Administrative
Agent, each Rating Agency, the Transferor, the Indenture Trustee and the Trust
Certificateholders. Upon receiving such notice of resignation, the Transferor
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 Administrator, the Transferor or Trust
Certificateholders holding not less than a majority of the Certificate Balance,
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 Transferor or such Trust
Certificateholders may remove the Owner Trustee. If the Owner Trustee shall be
removed pursuant to the preceding sentence, the Transferor 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.
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
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the outgoing Owner Trustee. The Transferor shall provide written notice of such
resignation or removal of the Owner Trustee to each Rating Agency. Any
appointment of a successor Owner Trustee is subject to satisfaction of the
Rating Agency Condition.
Section 10.03. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.02 shall execute, acknowledge and deliver to
the Administrator 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 Transferor, the Administrator 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 Transferor shall mail notice of the successor of such
Owner Trustee to all Trust Certificateholders, the Indenture Trustee and each
Rating Agency. If the Transferor shall fail to mail such notice within ten days
after acceptance of appointment by the successor Owner Trustee, the successor
Owner Trustee shall cause such notice to be mailed at the expense of the
Transferor.
Section 10.04. Merger or Consolidation of Owner Trustee. Any Person
(i) into which the Owner Trustee may be merged or converted or with which it
may be consolidated, (ii) resulting from any merger, conversion or
consolidation to which the Owner Trustee shall be a party or (iii) 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, provided, that such Person shall be eligible pursuant to
Section 10.01 anything herein to the contrary notwithstanding. The Owner
Trustee shall mail notice of such merger, conversion, or consolidation to each
Rating Agency, the Indenture Trustee and the Trust Certificateholders.
Section 10.05. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provision 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 may at the time be located, the Transferor and the
Owner Trustee acting jointly shall have the power and shall execute and deliver
all instruments to appoint one or more Persons to act as co-trustee, jointly
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with the Owner Trustee, or 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 Issuer, or any part thereof, and, subject to the other
provisions of this Section, such powers, duties, obligations, rights and trusts
as the Transferor and the Owner Trustee may consider necessary or desirable. If
the Transferor 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 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 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 Transferor 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
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 and a copy thereof given to the Administrator, the Administrative
Agent and the Transferor.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be exercised
by the Owner Trustee, to the extent permitted by law, without the appointment
of a new or successor trustee.
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ARTICLE ELEVEN
TAX MATTERS
Section 11.01. Tax and Accounting Characterization.
(a) It is the intent of the parties hereto that the Issuer not
constitute a separate entity for federal income tax or state income or
franchise tax purposes. It is the intent of the Transferor, the Senior
Noteholders and Trust Certificateholders that the Senior Notes and the Trust
Certificates be treated as indebtedness of the Transferor secured by the
Specified Vehicles and the payments on the Specified Leases for federal income
tax and state income and franchise tax purposes. If, however, the Trust
Certificates are characterized as equity in the Issuer and the Issuer is
characterized as a separate entity for federal income tax purposes, it is the
intention of the parties that it qualify as a partnership, with the assets of
the partnership being the Owner Trust Estate and the partners of the
partnership being the Trust Certificateholders (including the Transferor as
owner of the Subordinated Notes and the Transferor Trust Certificate) and the
Notes being debt of the partnership. The parties agree that, unless otherwise
required by appropriate tax authorities, the Issuer shall not file or cause to
be filed annual returns, reports or other forms and will treat the Issuer in a
manner consistent with the characterization that the Issuer is not a separate
entity for tax purposes.
The Transferor and the Trust Certificateholders, by acceptance of a
Trust Certificate, agree to take no action inconsistent with the tax treatment
of the Trust Certificates as indebtedness.
(b) It is the intent of the Transferor that the Subordinated Notes be
treated as a direct ownership interest in the assets of the Issuer for purposes
of federal income tax and state income and franchise tax purposes. If, however,
the Issuer is characterized as a separate entity for federal income tax
purposes, it is the intention of the parties that the Issuer qualify as a
partnership for such purposes and the Transferor, as the holder of the
Subordinated Notes, will be treated as a partner in such partnership. The
Transferor, as Subordinated Noteholder, agrees to take no action inconsistent
with tax treatment of the Subordinated Notes as a direct ownership interest in
the assets of the Issuer for all tax purposes.
(c) It is the intent of the Transferor to treat the Trust Certificates
as equity interests in the Issuer for financial accounting purposes.
Section 11.02. Signature on Returns; Tax Matters Partner.
(a) In the event that the Issuer shall be required to file federal or
other income tax returns as a partnership, such returns shall be signed by an
authorized signatory for the Transferor, as holder of the Transferor Trust
Certificate, or such other Person as shall be required by law to sign such
returns of the Issuer.
(b) By acceptance of its beneficial interest in a Trust Certificate,
each Trust Certificateholder agrees that in the event that the Issuer is
classified as a partnership for federal income tax purposes, the Transferor, as
holder of the Transferor Trust Certificate and the Subordinated Notes, shall be
the "tax matters partner" of the Issuer pursuant to the Code.
Section 11.03. Tax Reporting. Unless otherwise required by appropriate
tax authorities, the Issuer shall not file or cause to be filed annual or other
income or franchise tax returns and shall not be required to obtain any
taxpayer identification number.
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ARTICLE TWELVE
MISCELLANEOUS
Section 12.01. Amendments.
(a) This Agreement may be amended by the Transferor and the Owner
Trustee without the consent of any of the Securityholders to cure any
ambiguity, correct or supplement any provision herein that may be inconsistent
with any other provision herein, add any other provisions with respect to
matters or questions arising under this Agreement that are not inconsistent
with the provisions of this Agreement or add or amend any provision herein in
connection with permitting transfers of the Subordinated Notes or the Trust
Certificates; provided, however, that such action shall not, as evidenced by an
Opinion of Counsel, materially adversely affect the interests of any Holder of
a 1999-A SUBI Certificate (which, so long as any Senior Notes are outstanding,
shall include the Indenture Trustee) or any Securityholder.
(b) This Agreement may also be amended from time to time by the
Transferor and the Owner Trustee, with prior written notice to the Rating
Agencies and subject to the satisfaction of the Rating Agency Condition, with
the consent of the Senior Noteholders holding a majority of the Outstanding
Amount (as such term is defined in the Indenture) of the Senior Notes and, to
the extent affected thereby, the consent of (i) the Subordinated Noteholder and
(ii) Trust Certificateholders holding not less than a majority of the
Certificate Balance, 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 Senior Noteholders, the Trust
Certificateholders or the Subordinated Noteholder. No such amendment shall,
however, (i) increase or reduce in any manner the amount of, or accelerate or
delay the timing of, distributions that are required to be made on the Notes or
the Trust Certificates or (ii) reduce the percentage of the Certificate
Balance, the Outstanding Amount or the Senior Note Outstanding Amount required
to consent to any such amendment, without the consent of the holders of 100% of
all outstanding Trust Certificates (other than the Transferor Trust
Certificate), and provided, further that an Opinion of Counsel shall be
furnished to the Indenture Trustee and the Owner Trustee to the effect that
such amendment shall not (A) affect the treatment of the Senior Notes as debt
for federal income tax purposes, (B) be deemed to cause a taxable exchange of
the Senior Notes for federal income tax purposes or (C) cause the Issuer or the
1999-A SUBI Certificates to be classified as an association (or a publicly
traded partnership) taxable as a corporation for federal income tax purposes.
This Agreement may also be amended or supplemented from time to time, at the
request of Trust Certificateholders holding not less than 75% of the
Certificate Balance, to approve any trust purpose with respect to the Issuer in
addition to the purpose authorized pursuant to Section 2.03(b) of this
Agreement, upon not less that 90 days notice to each Rating Agency and each
Noteholder and subject to each of (1) the prior written confirmation by each
Rating Agency that such action will not result in a Rating Event, and (2) the
consent of Senior Noteholders holding at least 75% of the Outstanding Amount
(as such term is defined in the Indenture) of the Senior Notes, or, if the
Senior Notes have been paid in full and are no longer outstanding, by the
Subordinated Noteholder, and provided, further that an Opinion of Counsel shall
be furnished to the Indenture Trustee and the Owner Trustee to the effect that
such amendment or supplement shall not affect the treatment of any outstanding
Senior Notes or Subordinated Notes for federal income tax purposes, or cause
the Issuer or the 1999-A SUBI Certificates to be classified as an association
(or a publicly traded partnership) taxable as a corporation for federal income
tax purposes.
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It shall not be necessary for the consent of Trust Certificateholders,
the Senior Noteholders or the Indenture Trustee 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 Trust Certificateholders
provided for in this Agreement or in any other Basic Document) and of
evidencing the authorization of the execution thereof by Trust
Certificateholders shall be subject to such reasonable requirements as the
Owner Trustee may prescribe.
(c) Notwithstanding Section 12.01(b), this Agreement may be amended at
any time by the parties hereto to the extent reasonably necessary to assure
that none of the Origination Trust, the Issuer or the Transferor will be
classified as an association (or a publicly traded partnership) taxable as a
corporation for federal income tax purposes.
(d) Prior to the execution of any amendment to this Agreement or any
other Basic Document, the Owner Trustee shall be entitled to receive and rely
upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and the other Basic Documents and
that all conditions precedent herein and in the other Basic Documents to the
execution and delivery of such amendment have been satisfied. The Owner Trustee
may, but shall not be obligated to, enter into any such amendment which affects
the Owner Trustee's own rights, duties or immunities under this Agreement or
otherwise.
(e) The Owner Trustee shall give the Trust Certificateholders 30 days'
written notice of any proposed amendment or supplement hereto, unless the Owner
Trustee is furnished an Opinion of Counsel to the effect that such amendment or
supplement does not materially adversely affect the Trust Certificateholders or
if Senior Noteholder consent is required and this Agreement provides that the
Owner Trustee shall not enter into such amendment unless a majority of the
Certificate Balance of Trust Certificateholders consent in writing.
Section 12.02. No Legal Title to Owner Trust Estate. Neither the Trust
Certificateholders nor the Subordinated Noteholder shall have legal title to
any part of the Owner Trust Estate. The Trust Certificateholders and the
Subordinated Noteholder shall be entitled to receive distributions with respect
to their Trust Certificates or Subordinated Notes, as the case may be, only in
accordance with Articles Five and Nine. No transfer, by operation of law or
otherwise, of any right, title or interest of (i) the Trust Certificateholders
to and in their ownership interest in the Owner Trust Estate or (ii) the
Subordinated Noteholder to and in the Subordinated Notes shall operate to
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 12.03. Limitations on Rights of Others. Except for Section
2.07, the provisions of this Agreement are solely for the benefit of the Owner
Trustee, the Transferor, the Trust Certificateholders, the Administrator, the
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Administrative Agent, the Indenture Trustee and the Noteholders, and nothing in
this Agreement (other than Section 2.07), 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 12.04. Notices. All demands, notices and communications
hereunder shall be in writing and shall be delivered or mailed by registered or
certified first-class United States mail, postage prepaid, hand delivery,
prepaid courier service, or by telecopier, and addressed in each case as
follows: (i) if to the Owner Trustee, at 1201 Market Street, Wilmington,
Delaware 19801 (telecopier no. (302) 984-4903), Attention: Corporate Trust
Department; (ii) if to the Transferor, at 3600 N.W. 82nd Avenue, Miami, Florida
33166 (telecopier no. (305) 500-3726), Attention: Treasurer; (iii) if to
Moody's, to 99 Church Street, New York, New York 10007, Attention: ABS
Monitoring Group (telecopier no. (212) 553-4600 or (212) 553-0344); (iv) if to
DCR, to Duff & Phelps Credit Rating Co., 55 East Monroe Street, Suite 3800,
Chicago Illinois 60603 (telecopier no. (312) 263-2852), Attention: Asset Backed
Monitoring Group (Equipment Leases); or (v) at such other address as shall be
designated by any of the foregoing in a written notice to the other parties
hereto. Delivery shall occur only upon receipt or reported tender of such
communication by an officer of the recipient entitled to receive such notices
located at the address of such recipient for notices hereunder.
Any notice required or permitted to be given to a Trust
Certificateholder or the Subordinated Noteholder shall be given by first-class
mail, confirmed, facsimile or overnight courier, postage prepaid, at the
address of such Trust Certificateholder or the Subordinated Noteholder as shown
in the Certificate Register. Any notice so mailed within the time prescribed in
this Agreement shall be conclusively presumed to have been duly given, whether
or not such Trust Certificateholder or the Subordinated Noteholder receives
such notice.
Section 12.05. 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 12.06. 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 12.07. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, the
Transferor, the Owner Trustee, each Trust Certificateholder and the
Subordinated Noteholder and their respective successors and permitted assigns,
all to the extent as herein provided. Any request, notice, direction, consent,
waiver or other instrument or action by the Subordinated Noteholder or a Trust
Certificateholder shall bind the successors and assigns of the Transferor or
such Trust Certificateholder.
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Section 12.08. No Petition. The Owner Trustee, any Paying Agent, the
Transferor, each Trust Certificateholder by accepting a Trust Certificate and
the Subordinated Noteholder by accepting the Subordinated Notes, covenant that
they will not institute, or join in instituting, any bankruptcy,
reorganization, arrangement, insolvency or liquidation Proceeding, or other
Proceeding under federal or State bankruptcy or similar laws, against the
Transferor or the Issuer, for a period of one year and a day after:
(a) payment in full of all amounts due to each Holder in respect
of the UTI, the SUBI or any Other SUBI, against any UTI Beneficiary
(or any general partner of a UTI Beneficiary which is a partnership,
the Origination Trust and the Origination Trustee, without the consent
of 100% of the Holders of the 1999-A Vehicle SUBI, the 1999-A Lease
SUBI and each Other SUBI (excluding the UTI Beneficiaries, the
Transferor or any of their respective Affiliates); and
(b) payment in full of the Offered Securities;
provided, however, that 100% of the Senior Noteholders, or, if no Senior Notes
are then outstanding, the Subordinated Noteholder, or if no Subordinated Notes
are then outstanding, 100% of the Trust Certificateholders (in each case
excluding the Transferor and any of its Affiliates) may at any time institute
or join in instituting any bankruptcy, reorganization, insolvency or
liquidation proceeding against the Transferor or the Issuer.
Section 12.09. No Recourse. Each Trust Certificate and each
Subordinated Note entitles the holder thereof to the respective rights and
benefits set forth in this Agreement and in the Trust Certificates or the
Subordinated Notes, as applicable. The Trust Certificates and the Subordinated
Notes do not represent interests in or obligations of the Administrative Agent,
the Transferor, the Owner Trustee, any Paying Agent, the Indenture Trustee or
any Affiliate thereof and no recourse may be had against such parties or their
assets, except as may be expressly set forth or contemplated in this Agreement,
the Trust Certificates, the Subordinated Notes or the other Basic Documents.
Section 12.10. 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 12.11. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of Delaware, without reference to its
conflicts of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
Section 12.12. Certificates Nonassessable and Fully Paid. Subject to
Section 2.07, Trust Certificateholders shall not be personally liable for
obligations of the Issuer. The interests represented by the Trust Certificates
shall be nonassessable for any losses or expenses of the Issuer or for any
reason whatsoever, and, upon authentication thereof pursuant to Section 3.03,
3.04 and 3.05, the Trust Certificates shall be deemed fully paid.
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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.
RYDER FUNDING LP,
as Transferor
By: RYDER TRUCK RENTAL III LLC,
as General Partner
By: RTR LEASING II, INC.,
as Manager
By:
---------------------------------
Name:
Title:
CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
By:
---------------------------------
Name:
Title:
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EXHIBIT A
FORM OF TRUST CERTIFICATE
SEE REVERSE FOR CERTAIN DEFINITIONS
[TO BE INSERTED ON TRUST CERTIFICATES OTHER THAN THE TRANSFEROR TRUST
CERTIFICATE:
THIS TRUST CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY
STATE SECURITIES OR BLUE SKY LAW. THE HOLDER HEREOF, BY PURCHASING THIS TRUST
CERTIFICATE, AGREES THAT THIS TRUST CERTIFICATE MAY BE REOFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND
OTHER APPLICABLE LAWS AND ONLY PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"),
PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, IN
EACH CASE WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE, PLEDGE OR
OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A SUBJECT TO THE RECEIPT BY
THE OWNER TRUSTEE AND THE TRANSFEROR OF A LETTER SUBSTANTIALLY IN THE FORM
PROVIDED IN THE TRUST AGREEMENT AND THE RECEIPT BY THE OWNER TRUSTEE AND THE
TRANSFEROR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE OWNER TRUSTEE AND THE
TRANSFEROR THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE WITH
ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES AND ANY OTHER APPLICABLE JURISDICTION. THIS TRUST
CERTIFICATE MAY NOT BE PURCHASED OR HELD WITH PLAN ASSETS OF ANY "EMPLOYEE
BENEFIT PLAN" WHICH IS SUBJECT TO THE REQUIREMENTS OF TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR ANY PLAN COVERED BY
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (EACH A "BENEFIT
PLAN"). BY ACCEPTANCE OF THIS TRUST CERTIFICATE OR AN INTEREST THEREIN, THE
HOLDER HEREOF SHALL BE DEEMED TO REPRESENT AND WARRANT THAT ITS ACQUISITION AND
HOLDING IS IN COMPLIANCE WITH THE FOREGOING RESTRICTION ON BENEFIT PLAN ASSETS.
THIS TRUST CERTIFICATE IS NOT TRANSFERABLE UNLESS THE PARTY
TRANSFERRING THIS TRUST CERTIFICATE DELIVERS TO THE OWNER TRUSTEE, THE
TRANSFEROR, AND RTRT, INC., AS TRUSTEE OF RYDER TRUCK RENTAL LT (THE
"ORIGINATION TRUST"), AN OPINION OF COUNSEL STATING THE CIRCUMSTANCES AND
CONDITIONS UPON WHICH THIS TRUST CERTIFICATE MAY BE TRANSFERRED AND THAT SUCH
TRANSFER AS DESCRIBED THEREIN WILL NOT CAUSE EITHER THE ISSUER OR THE
ORIGINATION TRUST TO BE CLASSIFIED AS AN ASSOCIATION (OR A PUBLICLY TRADED
PARTNERSHIP) TAXABLE AS A CORPORATION FOR FEDERAL INCOME TAX PURPOSES. UPON
DELIVERY OF SUCH OPINION, THE OWNER TRUSTEE WILL NOTIFY THE HOLDER OF THIS
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<PAGE> 55
TRUST CERTIFICATE THAT THIS TRUST CERTIFICATE MAY BE TRANSFERRED IN ACCORDANCE
WITH THE CONDITIONS SET FORTH IN SUCH OPINION OF COUNSEL, AND THE HOLDER OF
THIS TRUST CERTIFICATE MAY EXCHANGE THIS TRUST CERTIFICATE FOR A NEW TRUST
CERTIFICATE OF LIKE DENOMINATION AND TENOR, WHICH NEW TRUST CERTIFICATE MAY BE
TRANSFERRED IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH THEREON.]
[TO BE INSERTED ON THE TRANSFEROR TRUST CERTIFICATE:
THIS TRUST CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN THE EVENT OF THE
DISSOLUTION, TERMINATION OR BANKRUPTCY OF RYDER FUNDING LP WHEN IT IS HOLDER
HEREOF, AND ANY TRANSFER IN VIOLATION OF THIS PROVISION SHALL BE NULL AND
VOID.]
THE PRINCIPAL OF THIS TRUST CERTIFICATE IS DISTRIBUTABLE AS SET FORTH
IN THE TRUST AGREEMENT. ACCORDINGLY, THE OUTSTANDING CERTIFICATE BALANCE OF
THIS TRUST CERTIFICATE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE
FACE HEREOF.
RYDER VEHICLE LEASE TRUST 1999-A
[____]% ASSET BACKED CERTIFICATE
evidencing a beneficial interest in the Issuer, as defined below, the property
of which includes, among other things, the 99% 1999-A Vehicle SUBI Certificate
(transferred pursuant to the Issuer SUBI Certificate Transfer Agreement),
evidencing a 99% beneficial interest in the 1999-A Vehicle SUBI Assets. The
property of the Issuer has been pledged to the Indenture Trustee pursuant to
the Indenture to secure the payment of the Senior Notes issued thereunder.
This Trust Certificate does not represent an interest in or obligation
of the Transferor, Ryder Truck Rental, Inc., the Owner Trustee or any of their
respective Affiliates, except to the extent described below.
NUMBER $__________
R-_____ CUSIP NO. ______
This certifies that ____________________ is the registered owner of a
____________________ dollar nonassessable, fully-paid, beneficial ownership
interest in the Ryder Vehicle Lease Trust 1999-A (the "Issuer") formed by Ryder
Funding LP, a Delaware limited partnership (the "Transferor").
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<PAGE> 56
The Issuer was created pursuant to a trust agreement, as amended and
restated as of [_________], 1999 (the "Trust Agreement"), between the
Transferor and Chase Manhattan Bank Delaware, as trustee (the "Owner Trustee"),
a summary of certain of the pertinent provisions of which is set forth below.
Capitalized terms used herein that are not otherwise defined shall have the
meanings assigned thereto in the Trust Agreement.
This Trust Certificate is one of the duly authorized Trust
Certificates designated as "[____]% Asset Backed Certificates" (the "Trust
Certificates"). Also issued under the Trust Agreement are the [____]% Asset
Backed Subordinated Notes (the "Subordinated Notes"). Also issued under an
indenture, dated as of [__________], 1999 (the "Indenture"), between the Issuer
and U.S. Bank National Association, as trustee (the "Indenture Trustee"), are
the [____]% Senior Notes. This Trust Certificate is issued under and is subject
to the terms, provisions and conditions of the Trust Agreement, to which Trust
Agreement the holder of this Trust Certificate by virtue of the acceptance
hereof assents and by which such Trust Certificateholder is bound. The property
of the Issuer primarily includes, among other things, (i) the 99% 1999-A
Vehicle SUBI Certificate (transferred pursuant to the Issuer SUBI Certificate
Transfer Agreement), evidencing a 99% beneficial interest in the 1999-A Vehicle
SUBI Assets, (ii) the rights of the Issuer under the Program Operating Lease,
(iii) the security interest of the Issuer in the 1999-A Lease SUBI, the
Subordinated Notes and the Reserve Fund Property and (iv) all proceeds of the
foregoing. The rights of the Issuer in the foregoing property have been pledged
by the Issuer to the Indenture Trustee to secure the payment of the Senior
Notes.
The Trust Certificates represent obligations of the Issuer only and do
not represent interests in, recourse to or obligations of the Transferor, the
UTI Beneficiaries or any of their respective Affiliates.
Under the Trust Agreement, there will be distributed on ___________
15, ___________ 15, ___________ 15 and ___________ 15 of each year or, as
necessary, ___________ 15, 200__ (or, if such day is not a Business Day, the
next Business Day), commencing ___________, 200__ (each, a "Payment Date"), and
ending no later than ___________ 15, 200__, to the Person in whose name this
Trust Certificate is registered at the close of business on the day preceding
each Payment Date (each, a "Record Date") such Trust Certificateholder's
percentage interest in the amount to be distributed with respect to the Trust
Certificates on such Payment Date and any remaining amounts shall be
distributed to the Transferor as holder of the Transferor Trust Certificate
pursuant to the terms of the Basic Documents.
The holder of this Trust Certificate acknowledges and agrees that its
rights to receive payments in respect of this Trust Certificate are
subordinated to the rights of the Senior Noteholders as described in the
Indenture and the Subordinated Noteholder as described in the Trust Agreement,
as applicable.
It is the intent of the Transferor and Trust Certificateholders that
the Trust Certificates be treated as indebtedness of the Transferor for
purposes of federal income tax or State income and franchise taxes. If,
however, the Issuer is characterized as a separate entity for federal income
tax purposes, it is the intention of the parties to the Trust Agreement that it
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<PAGE> 57
qualify as a partnership for such purposes and the Trust Certificateholders
will be treated as partners in that partnership. The Transferor and the other
Trust Certificateholders, by acceptance of a Trust Certificate, agree to take
no action inconsistent with such tax treatment of the Trust Certificates.
Each Trust Certificateholder by accepting a Trust Certificate,
covenants and agrees that they will not institute, or join in instituting, any
bankruptcy, reorganization, arrangement, insolvency or liquidation Proceeding,
or other Proceeding under federal or State bankruptcy or similar laws for a
period of one year and a day after:
(a) payment in full of all amounts due to each Holder in respect
of the UTI, the SUBI or any Other SUBI, against any UTI Beneficiary
(or any general partner of a UTI Beneficiary which is a partnership,
the Origination Trust and the Origination Trustee, without the consent
of 100% of the Holders of the 1999-A Vehicle SUBI, the 1999-A Lease
SUBI and each Other SUBI (excluding the UTI Beneficiaries, the
Transferor or any of their respective Affiliates); and
(b) payment in full of the Offered Securities, against the
Transferor or the Issuer; provided, however, that 100% of the Senior
Noteholders, or, if no Senior Notes are then outstanding, or, if no
Senior Notes are then outstanding, the Subordinated Noteholder, or if
no Subordinated Notes are outstanding, 100% of the Trust
Certificateholders (in each case excluding the Transferor and any of
its Affiliates) may at any time institute or join in instituting any
bankruptcy, reorganization, insolvency or liquidation proceeding
against the Transferor or the Issuer.
Distributions on this Trust Certificate will be made as provided in
the Trust Agreement by the Owner Trustee by check mailed to the Trust
Certificateholder of record in the Certificate Register without the
presentation or surrender of this Trust Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final payment on this Trust Certificate will be
made after due notice by the Owner Trustee of the pendency of such payment and
only upon presentation and surrender of this Trust Certificate at the office or
agency maintained for the purpose by the Owner Trustee in The City of New York.
Reference is hereby made to the further provisions of this Trust
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee, by manual signature,
this Trust Certificate shall not entitle the holder hereof to any benefit under
the Trust Agreement or be valid for any purpose.
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<PAGE> 58
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICTS OF LAW PROVISIONS,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Issuer and not
in its individual capacity, has caused this Trust Certificate to be duly
executed.
Dated: ________________________ RYDER VEHICLE LEASE TRUST 1999-A
By: CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
By:
---------------------------------
Name:
Title:
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the
within-mentioned Trust Agreement.
CHASE MANHATTAN BANK, DELAWARE, or CHASE MANHATTAN BANK, DELAWARE,
as Owner Trustee as Owner Trustee
By: THE CHASE MANHATTAN BANK,
Authenticating Agent
By:
----------------------------
By:
-----------------------------
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<PAGE> 59
[Reverse of Trust Certificate]
The Trust Certificates do not represent an obligation of or an
interest in the Transferor, the Administrative Agent, the Owner Trustee or any
of their respective Affiliates, and no recourse may be had against such parties
or their assets, except as may be expressly set forth or contemplated herein or
in the Trust Agreement or the other Basic Documents. In addition, this Trust
Certificate is not guaranteed by any governmental agency or instrumentality and
is limited in right of payment to certain collections and recoveries and
certain other amounts respecting the assets of the Issuer, all as more
specifically set forth in the Indenture. The Transferor will furnish, upon the
request of any holder of a Trust Certificate, such information as is specified
in paragraph (d)(4) of Rule 144A of the Securities Act of 1933, as amended,
with respect to the Issuer.
The Trust Agreement may be amended by the Transferor and the Owner
Trustee without the consent of any of the Securityholders to cure any
ambiguity, correct or supplement any provision therein that may be inconsistent
with any other provision therein, add any other provisions with respect to
matters or questions arising under the Trust Agreement that are not
inconsistent with the provisions of the Trust Agreement or add or amend any
provision therein in connection with permitting transfers of the Subordinated
Notes or the Trust Certificates; provided, however, that such action shall not,
as evidenced by an Opinion of Counsel, materially adversely affect the
interests of any Holder of a 1999-A SUBI Certificate (which, so long as any
Senior Notes are outstanding, shall include the Indenture Trustee) or any
Securityholder.
The Trust Agreement may also be amended from time to time by the
Transferor and the Owner Trustee, with prior written notice to the Rating
Agencies, with the consent of the Senior Noteholders holding a majority of the
Senior Note Outstanding Amount and, to the extent affected thereby, the consent
of (i) the Subordinated Noteholder and (ii) Trust Certificateholders holding
not less than a majority of the Certificate Balance, for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions of the Trust Agreement or of modifying in any manner the rights of
the Senior Noteholders, the Trust Certificateholders or the Subordinated
Noteholder. No such amendment shall, however, (i) increase or reduce in any
manner the amount of, or accelerate or delay the timing of, distributions that
are required to be made on the Notes or the Trust Certificates or (ii) reduce
the percentage of the Certificate Balance, the Outstanding Amount or the Senior
Note Outstanding Amount required to consent to any such amendment, without the
consent of the holders of 100% of all outstanding Trust Certificates (other
than the Transferor Trust Certificate), and provided, further that an Opinion
of Counsel shall be furnished to the Indenture Trustee and the Owner Trustee to
the effect that such amendment shall not (A) affect the treatment of the Senior
Notes as debt for federal income tax purposes, (B) be deemed to cause a taxable
exchange of the Senior Notes for federal income tax purposes or (C) cause the
Issuer or the 1999-A SUBI Certificates to be classified as an association (or a
publicly traded partnership) taxable as a corporation for federal income tax
purposes.
Notwithstanding the foregoing, the Trust Agreement may be amended at
any time by the parties hereto to the extent reasonably necessary to assure
that none of the Origination Trust, the Issuer or the Transferor will be
classified as an association (or a publicly traded partnership) taxable as a
corporation for federal income tax purposes.
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<PAGE> 60
As provided in the Trust Agreement, and if the Transferor delivers an
Opinion of Counsel that the Trust Certificates are transferable in accordance
with the terms set forth therein, which opinion the Transferor has not
determined can be given under the Internal Revenue Code and existing and
proposed regulations thereunder, the transfer of this Trust Certificate is
registerable in the Certificate Register upon surrender of this Trust
Certificate for registration of transfer at the offices or agencies of the
Certificate Registrar maintained by the Owner Trustee in the Borough of
Manhattan, The City of New York, accompanied by a written instrument of
transfer in form satisfactory to the Owner Trustee and the Certificate
Registrar duly executed by the Trust Certificateholder hereof or such Trust
Certificateholder's attorney duly authorized in writing, and thereupon one or
more new Trust Certificates of the same class and in authorized denominations
evidencing the same aggregate interest in the Issuer will be issued to the
designated transferee. The initial Certificate Registrar appointed under the
Trust Agreement is The Chase Manhattan Bank.
The Trust Certificates are issuable only as registered Trust
Certificates without coupons in minimum denominations of $250,000 or integral
multiples of $1,000 in excess thereof. As provided in the Trust Agreement and
subject to certain limitations therein set forth, Trust Certificates are
exchangeable for new Trust Certificates of authorized denominations evidencing
the same aggregate denomination, as requested by the Holder surrendering the
same. No service charge will be made for any such registration of transfer or
exchange, but the Owner Trustee or the Certificate Registrar may require
payment of a sum sufficient to cover any tax or governmental charge payable in
connection therewith.
The Owner Trustee, the Certificate Registrar and any agent of the
Owner Trustee or the Certificate Registrar may treat the Person in whose name
this Trust Certificate is registered as the owner hereof for all purposes, and
none of the Owner Trustee, the Certificate Registrar or any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Trust Agreement
and the trust created thereby shall terminate upon the payment to Trust
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Indenture and the disposition of all property held as
part of the Owner Trust Estate.
Any prospective transferee of a Trust Certificate will be required to
deliver a letter to the Transferor, the Certificate Registrar and the Initial
Purchaser substantially in the form of Exhibit D to the Trust Agreement, which
letter includes a representation that such prospective transferee is not a
Benefit Plan Investor. The Trust Certificates may not be transferred, sold,
pledged or otherwise disposed to or for the account of a Benefit Plan Investor.
The Trust Certificates may not be acquired by a Benefit Plan. By
accepting and holding this Trust Certificate, the holder hereof shall be deemed
to have represented and warranted that it is not a Benefit Plan and is not
acquiring this Trust Certificate or an interest therein for the account of a
Benefit Plan.
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<PAGE> 61
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
- -------------------------------------------------------------------------------
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Please print or type name and address, including postal zip code, of assignee)
the within Trust Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing ______________________________ attorney to transfer
said Trust Certificate on the books of the Certificate Registrar, with full
power of substitution in the premises.
Dated: ___________________
*
- ----------------------------------------
Signature Guaranteed:
*
- ----------------------------------------
* NOTICE: The signatures(s) on this Assignment must correspond with the
name(s) as written on the face of the within Trust Certificate in every
particular without alteration, enlargement or any change whatsoever. Such
signature must be guaranteed by a member firm of the New York Stock Exchange
or a commercial bank or trust company.
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<PAGE> 62
EXHIBIT B
FORM OF SUBORDINATED NOTE
THIS SUBORDINATED NOTE MAY NOT BE TRANSFERRED
RYDER VEHICLE LEASE TRUST 1999-A
[____]% ASSET BACKED SUBORDINATED NOTE
Ryder Vehicle Lease Trust 1999-A (the "Issuer"), a trust created
pursuant to a trust agreement, as amended and restated as of [____________],
1999 (the "Trust Agreement") between Ryder Funding LP, as Transferor (the
"Transferor"), and Chase Manhattan Bank Delaware, as trustee (the "Owner
Trustee"), for value received, hereby promises to pay to the Transferor, upon
presentation and surrender of this Subordinated Note the principal sum of
$[___________] Dollars on [____________], 200__, or earlier, all in accordance
with the Trust Agreement. The Issuer will pay interest on this Subordinated
Note at the rate per annum shown above on each Payment Date until the principal
of this Subordinated Note is paid or made available for payment, on the
principal amount of this Subordinated Note outstanding on the preceding Payment
Date (after giving effect to all payments of principal made on such preceding
Payment Date) in accordance with the Trust Agreement. To the extent that
interest on this Subordinated Note is accrued but not paid in full on any
Payment Date, such overdue interest will be due on the next Payment Date
together with interest on such amount (to the extent lawful) at the
Subordinated Note Rate.
The holder of this Subordinated Note acknowledges and agrees that its
rights to receive payments in respect of this Subordinated Note are
subordinated to the rights of the Senior Noteholders to the extent described in
the Indenture and the Trust Agreement.
Unless the certificate of authentication hereon has been executed by
the Owner Trustee whose name appears below by manual signature, this
Subordinated Note shall not be entitled to any benefit under the Trust
Agreement or be valid or obligatory for any purpose.
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICTS OF LAW PROVISIONS,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
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<PAGE> 63
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.
Dated: ________________________ RYDER VEHICLE LEASE TRUST 1999-A
By: CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
By:
-----------------------------------
Name:
Title:
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the
within-mentioned Trust Agreement.
CHASE MANHATTAN BANK, DELAWARE, or CHASE MANHATTAN BANK, DELAWARE,
as Owner Trustee as Owner Trustee
By: THE CHASE MANHATTAN BANK,
Authenticating Agent
By:
--------------------------------
By:
-----------------------------
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<PAGE> 64
EXHIBIT C
FORM OF RULE 144A CERTIFICATE
Dated:
Ryder Funding LP
c/o Ryder Truck Rental III LLC
its General Partner
3600 N.W. 82nd Avenue
Miami, Florida 33166
Chase Manhattan Bank Delaware,
as Owner Trustee
1201 Market Street
Wilmington, Delaware 19801
The Chase Manhattan Bank,
as Certificate Registrar
55 Water Street
New York, New York
Ladies and Gentlemen:
This is to notify you as to the transfer of $____________ initial
principal balance of ____% Asset Backed Certificates (the "Trust Certificates")
of Ryder Vehicle Lease Trust 1999-A (the "Issuer").
The undersigned is the holder of the Trust Certificates and with this
notice hereby deposits with the Owner Trustee $____________ initial principal
balance of Trust Certificates and requests that Trust Certificates in the same
initial principal balance be issued, executed and authenticated and registered
to the purchaser on ____________, 199__, as specified in the Trust Agreement,
as follows:
Name: Denominations:
Address:
Taxpayer I.D. No:
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<PAGE> 65
The undersigned represents and warrants that the undersigned (a) reasonably
believes the purchaser is a "qualified institutional buyer," as defined in Rule
144A under the Securities Act of 1933, as amended (the "Act"), (b) such
purchaser has acquired the Trust Certificates in a transaction effected in
accordance with the exemption from the registration requirements of the Act
provided by Rule 144A and (c) if the purchaser has purchased the Trust
Certificates for one or more accounts for which it is acting as fiduciary or
agent, (i) each such account is a qualified institutional buyer and (ii) the
purchaser is acquiring Trust Certificates for its own account or for one or
more institutional accounts for which it is acting as fiduciary or agent in a
minimum amount equivalent to not less than $250,000 for each such account.
Very truly yours,
---------------------------------
By:
---------------------------------
Name:
Title:
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<PAGE> 66
EXHIBIT D
FORM OF INVESTMENT LETTER
QUALIFIED INSTITUTIONAL BUYER
Dated:
U.S. Bank National Association,
as Indenture Trustee
One Illinois Center
111 East Wacker Drive
Chicago, Illinois 60601
Chase Manhattan Bank Delaware,
as Owner Trustee
1201 Market Street
Wilmington, Delaware 19801
Merrill Lynch, Pierce, Fenner
& Smith Incorporated,
as Initial Purchaser
World Financial Center, North Tower
New York, New York 10281
Ryder Funding LP
c/o Ryder Truck Rental III LLC
its General Partner
3600 N.W. 82nd Avenue
Miami, Florida 33166
Ladies and Gentlemen:
In connection with our proposed purchase of $__________________
aggregate principal amount of Certificates (the "Certificates") representing an
undivided interest in the Ryder Vehicle Lease Trust 1999-A (the "Trust"), the
investor on whose behalf the undersigned is executing this letter (the
"Purchaser") confirms that:
1. Reference is made to the Offering Circular, dated ________________,
1999 (the "Offering Circular"), relating to the Certificates. Capitalized terms
used herein that are not otherwise defined shall have the meanings ascribed
thereto in the Offering Circular. The Purchaser has received a copy of the
Offering Circular and such other information as the Purchaser deems necessary
in order to make its investment decision and the Purchaser has been provided
the opportunity to ask questions of, and receive answers from, the
Administrative Agent and Ryder Funding LP, as the Transferor, concerning the
Administrative Agent, the UTI Beneficiaries and the Transferor and the terms
and conditions of the offering described in the Offering Circular. The
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<PAGE> 67
Purchaser has received and understands the above, and understands that
substantial risks are involved in an investment in the Certificates. The
Purchaser represents that in making its investment decision to acquire the
Certificates, the Purchaser has not relied on representations, warranties,
opinions, projections, financial or other information or analysis, if any,
supplied to it by any person, including you, the Administrative Agent, the
Transferor or the Owner Trustee or any of your or their affiliates, except as
expressly contained in the Offering Circular and in the other written
information, if any, discussed above. The Purchaser acknowledges that it has
read and agreed to the matters stated on pages [(i) to (___)] of such Offering
Circular and the information under the heading "Notice to Investors", including
the restrictions on duplication and circulation of such Offering Circular. The
Purchaser has such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of an investment in the
Certificates, and the Purchaser is able to bear the substantial economic risks
of such an investment. The Purchaser has relied upon its own tax, legal and
financial advisors in connection with its decision to purchase the
Certificates.
2. The Purchaser is (A) a "Qualified Institutional Buyer" (as defined
in Rule 144A under the Securities Act of 1933, as amended (the "1933 Act")) and
has delivered to you a certificate substantially in the form attached hereto as
Annex I or Annex 2, as applicable and (B) acquiring the Certificates for its
own account or for the account of an investor of the type described in clause
(A) above as to each of which the Purchaser exercises sole investment
discretion. The Purchaser is purchasing the Certificates for investment
purposes and not with a view to, or for, the offer or sale in connection with,
a public distribution or in any other manner that would violate the 1933 Act or
the securities or blue sky laws of any state.
3. The Purchaser understands that the Certificates have not been and
will not be registered under the 1933 Act or under the securities or blue sky
laws of any state, and that (i) if it decides to resell, pledge or otherwise
transfer any Certificate, such Certificate may be resold, pledged or
transferred without registration only to an entity that has delivered to the
Transferor and the Owner Trustee a certification that it is a Qualified
Institutional Buyer that purchases (1) for its own account or (2) for the
account of such a Qualified Institutional Buyer, that is, in either case, aware
that the resale, pledge or transfer is being made in reliance on said Rule 144A
and (ii) it will, and each subsequent holder will be required to, notify any
purchaser of any Certificate from it of the resale restrictions referred to in
clause (i) above.
4. The Purchaser understands that each of Certificate will bear a
legend to the following effect, unless otherwise agreed by the Transferor and
the Owner Trustee:
"THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
UNDER ANY STATE SECURITIES OR BLUE SKY LAW. THE HOLDER HEREOF, BY
PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE
REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND
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<PAGE> 68
ONLY PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A")
TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE
144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A SUBJECT TO THE
RECEIPT BY THE TRANSFEROR AND THE OWNER TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE TRUST AGREEMENT AND THE
RECEIPT BY THE OWNER TRUSTEE AND THE TRANSFEROR OF SUCH OTHER
EVIDENCE ACCEPTABLE TO THE OWNER TRUSTEE AND THE TRANSFEROR THAT
SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED
STATES AND SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND
ANY OTHER APPLICABLE JURISDICTION. THIS CERTIFICATE MAY NOT BE
PURCHASED OR HELD WITH PLAN ASSETS OF ANY "EMPLOYEE BENEFIT PLAN"
WHICH IS SUBJECT TO THE REQUIREMENTS OF TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR ANY PLAN
COVERED BY SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (EACH, A "BENEFIT PLAN"). BY ACCEPTANCE OF THIS
CERTIFICATE OR AN INTEREST THEREIN, THE HOLDER HEREOF SHALL BE
DEEMED TO REPRESENT AND WARRANT THAT ITS ACQUISITION AND HOLDING
IS IN COMPLIANCE WITH THE FOREGOING RESTRICTION ON BENEFIT PLAN
ASSETS."
5. If the Purchaser is acquiring any Certificate as a fiduciary or
agent for one or more investor accounts, it has sole investment discretion with
respect to each such account and that it has full power to make the
acknowledgements, representations and agreements contained herein on behalf of
such account.
6. The purchaser is not (a) an employee benefit plan (as defined in
Section 3(3) of ERISA) that is subject to the provisions of Title I of ERISA,
(b) a plan described in Section 4975(e)(1) of the Code or (c) any entity whose
underlying assets include plan assets by reason of a plan's investment in such
entity (each, a "Benefit Plan").
D-3
<PAGE> 69
7. The Purchaser has neither acquired nor will it transfer any
Certificate it purchases (or any interest therein) or cause any such
Certificates (or any interest therein) to be marketed on or through an
"established securities market" within the meaning of Section 7704(b)(1) of the
Code, including, without limitation, an over-the-counter-market or an
interdealer quotation system that regularly disseminates firm buy or sell
quotations.
8. The Purchaser either (A) is not, and will not become, a
partnership, Subchapter S corporation or grantor trust for U.S. federal income
tax purposes or (B) is such an entity, but none of the direct or indirect
beneficial owners of any of the interests in such transferee have allowed or
caused, or will allow or cause, 50% or more (or such other percentage as the
Transferor may establish prior to the time of such proposed transfer) of the
value of such interests to be attributable to such transferee's ownership of
Certificates.
9. The Purchaser understands that no subsequent transfer of the
Certificates is permitted unless (A) such transfer is of a Certificate with a
denomination of at least $250,000, (B) it causes its proposed transferee to
provide to the Transferor, the Certificate Registrar and the Initial Purchaser
a letter substantially in the form of Exhibit D to the Trust Agreement, as
applicable, or such other written statement as the Transferor shall prescribe
and (C) the Transferor consents in writing to the proposed transfer, which
consent shall be granted unless the Transferor determines that such transfer
would create a risk that the Issuer or the Origination Trust would be
classified for federal or any applicable state tax purposes as an association
(or a publicly traded partnership) taxable as a corporation; provided, however,
that any attempted transfer that would either cause (1) the number of
registered holders of Certificates and Subordinated Notes to exceed 100 or (2)
the number of holders of direct or indirect interests in the Origination Trust
to exceed 50, shall be a void transfer.
10. The Purchaser understands that the Opinion of Counsel to the
Issuer that the Issuer is not a publicly traded partnership taxable as a
corporation is dependent in part on the accuracy of the representations in
paragraphs 7, 8 and 9 above.
11. The Purchaser is a Person who is either (A)(1) a citizen or
resident of the United States, (2) a corporation, partnership or other entity
organized in or under the laws of the United States or any political
subdivision thereof or (3) a Person not described in (A)(1) or (2) whose
ownership of the Certificates is effectively connected with such Person's
conduct of a trade or business within the United States (within the meaning of
the Code) and its ownership of any interest in a Certificate will not result in
any withholding obligation with respect to any payments with respect to the
Certificates by any Person (other than withholding, if any, under Section 1446
of the Code) or (B) an estate the income of which is includible in gross income
for federal income tax purposes regardless of source or a trust if the court
within the United States is able to exercise primary supervision of the
administration of the trust and one or more United States persons have the
authority to control all substantial decisions of the Issuer. It agrees that it
will provide a certification of non-foreign status signed under penalty of
perjury and, alternatively, that if it is a Person described in clause (A)(3)
above, it will furnish to the Transferor and the Owner Trustee a properly
executed IRS Form 4224 and a new IRS Form 4224 upon the expiration or
obsolescence of any previously delivered form (and such other certifications,
representations or Opinions of Counsel as may be requested by the Transferor
and the Owner Trustee).
D-4
<PAGE> 70
12. The Purchaser agrees that if at some time in the future it wishes
to transfer or exchange any of the Certificates, it will not transfer or
exchange any of the Certificates unless such transfer or exchange is in
accordance with Section 3.04 of the Trust Agreement. The Purchaser understands
that any purported transfer of the Certificates (or any interest therein) in
contravention of any of the restrictions and conditions in the Trust Agreement,
as applicable, shall be a void, and the purported transferee in such transfer
shall not be recognized by the Issuer or any other Person as a
Certificateholder, as the case may, be for any purpose.
13. The Purchaser hereby irrevocably requests you to arrange for
definitive Certificates representing the Certificates purchased by the
Purchaser to be registered and delivered promptly after the Closing Date as
follows:
Principal Amount Registered in Deliver Definitive
of Definitive Certificate: Name of: Certificate to:
- -------------------------- ------------- ------------------
- -------------------------- ------------- ------------------
- -------------------------- ------------- ------------------
- -------------------------- ------------- ------------------
- -------------------------- ------------- ------------------
1. You and the Owner Trustee are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
By:
-------------------------------
Name:
Title:
D-5
<PAGE> 71
ANNEX 1 TO EXHIBIT D
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Purchaser") hereby certifies as follows to the
addressees of the Rule 144A Representation Letter to which this certification
is attached with respect to the Certificate described therein:
(i) As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive
officer of the Purchaser.
(ii) In connection with purchases by the Purchaser, the Purchaser is a
"qualified institutional buyer" as that term is defined in Rule
144A ("Rule 144A") under the Securities Act of 1933, as amended,
because (i) the Purchaser owned and/or invested on a
discretionary basis $__________(1) in securities (except for the
excluded securities referred to below) as of the end of the
Purchaser's most recent fiscal year (such amount being calculated
in accordance with Rule 144A) and (ii) the Purchaser satisfies
the criteria in the category marked below.
___ Corporation, etc. The Purchaser is a corporation (other
than a bank, savings and loan association or similar
institution), Massachusetts or similar business trust,
partnership, or charitable organization described in
Section 501(c)(3) of the Internal Revenue Code of 1986, as
amended.
___ Bank. The Purchaser (a) is a national bank or banking
institution organized under the laws of any state,
territory or the District of Columbia, the business of
which is substantially confined to banking and is
supervised by the state or territorial banking commission
or similar official or is a foreign bank or equivalent
institution, and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
___ Savings and Loan. The Purchaser (a) is a savings and loan
association, building and loan association, cooperative
bank, homestead association or similar institution, which
is supervised and examined by a state or federal authority
having supervision over any such institutions or is a
foreign savings and loan association or equivalent
institution and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
- ----------------------
(1) Purchaser must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Purchaser is a dealer, and, in that
case, Purchaser must own and/or invest on a discretionary basis at least
$10,000,000 in securities.
D-6
<PAGE> 72
___ Broker-dealer. The Purchaser is a dealer registered
pursuant to Section 15 of the Securities Exchange Act of
1934, as amended (the "Exchange Act").
___ Insurance Company. The Purchaser is an insurance company
whose primary and predominant business activity is the
writing of insurance or the reinsuring of risks
underwritten by insurance companies and which is subject
to supervision by the insurance commissioner or a similar
official or agency of a state, territory or the District
of Columbia.
___ State or Local Plan. The Purchaser is a plan established
and maintained by a state, its political subdivisions, or
any agency or instrumentality of the state or its
political subdivisions, for the benefit of its employees.
___ ERISA Plan. The Purchaser is an employee benefit plan
within the meaning of Title I of the Employee Retirement
Income Security Act of 1974.
___ Investment Advisor. The Purchaser is an investment advisor
registered under the Investment Advisors Act of 1940.
___ Small Business Investment Company. The Purchaser is a
small business investment company licensed by the U.S.
Small Business Administration under Section 301(c) or (d)
of the Small Business Investment Act of 1958.
___ Business Development Company. The Purchaser is a business
development company as defined in Section 202(a)(22) of
the Investment Advisors Act of 1940.
___ Trust Fund. The Purchaser is a trust fund whose trustee is
a bank or trust company and whose participants are
exclusively state or local Plans or ERISA Plans as defined
above, and no participant of the Purchaser is an
individual retirement account or an H.R. 10 (Keogh) plan.
D-7
<PAGE> 73
(iii) The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Purchaser,
(ii) securities that are part of an unsold allotment to or
subscription by the Purchaser, if the Purchaser is a dealer,
(iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned
but subject to a repurchase agreement and (vii) currency,
interest rate and commodity swaps.
(iv) For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Purchaser,
the Purchaser used the cost of such securities to the Purchaser
and did not include any of the securities referred to in the
preceding paragraph, except (i) where the Purchaser reports its
securities holdings in its financial statements on the basis of
their market value, and (ii) no current information with respect
to the cost of those securities has been published. If clause
(ii) in the preceding sentence applies, the securities may be
valued at their market value. Further, in determining such
aggregate amount, the Purchaser may have included securities
owned by subsidiaries of the Purchaser, but only if such
subsidiaries are consolidated with the Purchaser in its
financial statements prepared in accordance with generally
accepted accounting principles and if the investments of such
subsidiaries are managed under the Purchaser's direction.
However, such securities were not included if the Purchaser is a
majority-owned, consolidated subsidiary of another enterprise
and the Purchaser is not itself a reporting company under the
Exchange Act.
(v) The Purchaser acknowledges that it is familiar with Rule 144A
and understands that the seller to it and other parties related
to the Certificates are relying and will continue to rely on the
statements made herein because one or more sales to the
Purchaser may be in reliance on Rule 144A.
(vi) Until the date of purchase of the Certificates, the Purchaser
will notify each of the parties to which this certification is
made of any changes in the information and conclusions herein.
Until such notice is given, the Purchaser's purchase of the
Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if
the Purchaser is a bank or savings and loan is provided above,
the Purchaser agrees that it will furnish to such parties
updated annual financial statements promptly after they become
available.
- ----------------------------------
Name of Purchaser
By:
-------------------------------
Name:
Title:
Dated:
----------------------------
D-8
<PAGE> 74
ANNEX 2 TO EXHIBIT D
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That are Registered Investment Companies]
The undersigned (the "Purchaser") hereby certifies as follows to the
addressees of the Rule 144A Representation Letter to which this certification
is attached with respect to the Certificate described therein:
(i) As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Purchaser or,
if the Purchaser is a "qualified institutional buyer" as that
term is defined in Rule 144A ("Rule 144A") under the Securities
Act of 1933, as amended, because the Purchaser is part of a
Family of Investment Companies (as defined below), is such an
officer of the Adviser.
(ii) In connection with purchases by the Purchaser, the Purchaser is
a "qualified institutional buyer" as defined in Rule 144A
because (i) the Purchaser is an investment company registered
under the Investment Company Act of 1940, as amended, and (ii)
as marked below, the Purchaser alone, or the Purchaser's Family
of Investment Companies, owned at least $100,000,000 in
securities (other than the excluded securities referred to
below) as of the end of the Purchaser's most recent fiscal year.
For purposes of determining the amount of securities owned by
the Purchaser or the Purchaser's Family of Investment Companies,
the cost of such securities was used, except (i) where the
Purchaser or the Purchaser's Family of Investment Companies
reports its securities holdings in its financial statements on
the basis of their market value, and (ii) no current information
with respect to the cost of those securities has been published.
If clause (ii) in the preceding sentence applies, the securities
may be valued at market.
___ The Purchaser owned $__________ in securities (other than
the excluded securities referred to below) as of the end
of the Purchaser's most recent fiscal year (such amount
being calculated in accordance with Rule 144A).
___ The Purchaser is part of a Family of Investment Companies
which owned in the aggregate $__________ in securities
(other than the excluded securities referred to below) as
of the end of the Purchaser's most recent fiscal year
(such amount being calculated in accordance with Rule
144A).
(iii) The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof)
that have the same investment adviser or investment advisers
that are affiliated (by virtue of being majority owned
subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
D-9
<PAGE> 75
(iv) The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Purchaser or
are part of the Purchaser's Family of Investment Companies, (ii)
bank deposit notes and certificates of deposit, (iii) loan
participations, (iv) repurchase agreements, (v) securities owned
but subject to a repurchase agreement and (vi) currency,
interest rate and commodity swaps.
(v) The Purchaser is familiar with Rule 144A and understands that
the parties listed in the Rule 144A Representation Letter to
which this certification relates are relying and will continue
to rely on the statements made herein because one or more sales
to the Purchaser will be in reliance on Rule 144A. In addition,
the Purchaser will only purchase for the Purchaser's own
account.
(vi) Until the date of purchase of the Transferor Certificate, the
undersigned will notify the parties listed in the Rule 144A
Transferee Certificate to which this certification relates of
any changes in the information and conclusions herein. Until
such notice is given, the Purchaser's purchase of the
Certificates will constitute a reaffirmation of this
certification by the undersigned as of the date of such
purchase.
- ---------------------------------
Name of Purchaser or Adviser
By:
------------------------------
Name:
Title:
IF AN ADVISER:
- ---------------------------------
Name of Purchaser
Dated:
---------------------------
D-10
<PAGE> 1
Exhibit 10.8
===============================================================================
RYDER FUNDING LP,
as Program Lessee,
and
RYDER VEHICLE LEASE TRUST 1999-A,
as Program Lessor
-----------------------------------------------
PROGRAM OPERATING LEASE
Dated as of October 1, 1999
-----------------------------------------------
===============================================================================
<PAGE> 2
TABLE OF CONTENTS
Page
----
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions................................................... 2
Section 1.02. Interpretive Provisions....................................... 4
ARTICLE TWO
LEASE OF 99% VEHICLE SUBI CERTIFICATE
Section 2.01. Lease of Vehicle SUBI Certificate............................. 5
Section 2.02. Representations and Warranties of the Program Lessor.......... 5
Section 2.03. Program Lessee's Rights....................................... 6
Section 2.04. Pledge and Grant of Security Interest in 99% 1999-A Lease
SUBI Certificate............................................ 6
ARTICLE THREE
LEASE TERM AND PAYMENTS
Section 3.01. Term. ........................................................ 7
Section 3.02. Payments...................................................... 7
Section 3.03. Form of Payment............................................... 7
Section 3.04. Tax Treatment................................................. 7
Section 3.05. No Rights to Sublease or Renewal.............................. 7
ARTICLE FOUR
UNCONDITIONAL OBLIGATION; ADDITIONAL COLLATERAL
Section 4.01. Unconditional Obligation...................................... 8
Section 4.02. Assignment and Pledge of Certain Other Assets................. 9
ARTICLE FIVE
LIENS; LOCATION AND INSPECTION
Section 5.01. Liens........................................................ 10
Section 5.02. Change of Location........................................... 10
Section 5.03. Inspection and Information................................... 10
<PAGE> 3
Page
----
ARTICLE SIX
LEASE DEFAULTS
Section 6.01. Lease Defaults............................................... 11
ARTICLE SEVEN
REMEDIES
Section 7.01. Remedies..................................................... 12
Section 7.02. No Release................................................... 13
Section 7.03. Remedies Cumulative.......................................... 13
Section 7.04. Exercise of Other Rights or Remedies......................... 13
ARTICLE EIGHT
ASSIGNMENT OF PROGRAM OPERATING LEASE
Section 8.01. Assignment of Program Operating Lease by Program Lessor...... 14
ARTICLE NINE
MISCELLANEOUS
Section 9.01. Notices...................................................... 15
Section 9.02. Distribution of Vehicle SUBI Assets.......................... 15
Section 9.03. Successors and Assigns....................................... 15
Section 9.04. Right to Perform for Program Lessee.......................... 15
Section 9.05. Amendments................................................... 15
Section 9.06. No Petition.................................................. 16
Section 9.07. Survival..................................................... 16
Section 9.08. Severability................................................. 16
Section 9.09. Original..................................................... 16
Section 9.10. Single Transaction........................................... 17
Section 9.11. Table of Contents and Headings............................... 17
Section 9.12. Governing Law................................................ 17
Section 9.13. Counterparts................................................. 17
Section 9.14. Limitation of Liability of Owner Trustee..................... 17
Signatures................................................................. 18
ii
<PAGE> 4
PROGRAM OPERATING LEASE
This Program Operating Lease, dated as of October 1, 1999, is between
Ryder Vehicle Lease Trust 1999-A, a Delaware business trust (the "Issuer"), as
lessor (in such capacity, the "Program Lessor"), and Ryder Funding LP, a
Delaware limited partnership, as lessee (the "Program Lessee").
RECITALS
WHEREAS, Ryder Truck Rental I LP and Ryder Truck Rental II LP, as
Grantors and UTI Beneficiaries, Ryder Truck Rental, Inc., as administrative
agent, RTRT, Inc., as trustee, Delaware Trust Capital Management, Inc., as
Delaware trustee, and U.S. Bank National Association ("U.S. Bank"), as trust
agent, have entered into that certain second amended and restated trust
agreement, dated as of February 1, 1998 (the "Origination Trust Agreement"),
pursuant to which Ryder Truck Rental LT, a Delaware business trust (the
"Origination Trust") was created to, among other things, take assignments and
conveyances of, and hold in trust and deal in various Trust Assets (as such
term is defined in the Origination Trust Agreement);
WHEREAS, in connection with the 1999-A Supplement to the Origination
Trust Agreement, dated as of October 1, 1999 (the "1999-A SUBI Supplement",
and, together with the Origination Trust Agreement, the "SUBI Trust
Agreement"), two special units of beneficial interest (each a "1999-A SUBI"
and, collectively, the "1999-A SUBIs") will be created;
WHEREAS, in connection with the 1999-A SUBI Supplement, a separate
portfolio of leases and certain related assets of the Origination Trust (the
"1999-A Leases") will be allocated to one 1999-A SUBI (the "1999-A Lease
SUBI"), and the vehicles that are leased under the 1999-A Leases and certain
other related assets of the Origination Trust (the "1999-A Vehicles") will be
allocated to the other 1999-A SUBI (the "1999-A Vehicle SUBI");
WHEREAS, the Origination Trust has issued to Ryder Truck Rental I LP
("RTR I LP") and Ryder Truck Rental II LP ("RTR II LP" and, together with RTR I
LP, the "UTI Beneficiaries") certificates respectively representing 99% and 1%
interests in each 1999-A SUBI;
WHEREAS, the certificates representing the 99% interest in the 1999-A
Vehicle SUBI (the "99% 1999-A Vehicle SUBI Certificate") and the 99% interest
in the 1999-A Lease SUBI (the "99% 1999-A Lease SUBI Certificate", and together
with the 99% 1999-A Vehicle SUBI Certificate, the "99% 1999-A SUBI
Certificates") evidence beneficial interests in the 1999-A SUBI Assets,
including the right to receive 99% of certain payments relating to the 1999-A
SUBI Assets;
WHEREAS, pursuant to that certain transfer agreement, dated as of
October 1, 1999 (the "SUBI Certificate Transfer Agreement"), between RTR I LP,
as transferor, and the Program Lessee, as transferee, RTR I LP transferred the
99% 1999-A Vehicle SUBI Certificate and the 99% 1999-A Lease SUBI Certificate
to the Program Lessee;
<PAGE> 5
WHEREAS, the Issuer was formed pursuant to that certain trust
agreement, dated as of June 21, 1999, as amended and restated as of October 1,
1999 (the "Trust Agreement"), between the Program Lessee and Chase Manhattan
Bank Delaware, as trustee (the "Owner Trustee");
WHEREAS, pursuant to that certain transfer agreement, dated as of
October 1, 1999 (the "Issuer SUBI Certificate Transfer Agreement"), between the
Program Lessee, as transferor (the "Transferor"), and the Issuer, the Program
Lessee transferred the 99% 1999-A Vehicle SUBI Certificate to the Issuer;
WHEREAS, pursuant to that certain indenture, dated as of ________,
1999 (the "Indenture"), between the Indenture Trustee and the Program Lessor,
the Program Lessor has granted a security interest in the 99% 1999-A Vehicle
SUBI Certificate to U.S. Bank, as trustee (in such capacity, the "Indenture
Trustee");
WHEREAS, the Program Lessee desires to obtain from the Program Lessor
certain rights in and relating to the 1999-A Vehicles evidenced by the 99%
1999-A Vehicle SUBI Certificate, including all rights to payments on or in
respect of the 99% 1999-A SUBI Certificates during the term hereof, and the
Program Lessor is willing to grant to the Program Lessee such rights for the
period specified herein on the terms and conditions set forth herein; and
WHEREAS, the Program Lessee, as pledgor, has agreed to pledge the 99%
1999-A Lease SUBI Certificate to the Program Lessor pursuant to this Agreement
to secure the performance of its obligations as Program Lessee hereunder;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions. Capitalized terms used herein that are not
otherwise defined shall have the meanings ascribed thereto in the Trust
Agreement, the Indenture, the SUBI Trust Agreement or the Administration
Agreement, as the case may be. Whenever used in this Agreement, unless the
context otherwise requires, the following words and phrases shall have the
following meanings:
"Administration Agreement" means the Basic Administration Agreement as
supplemented by the Administration Supplement, as amended or supplemented from
time to time.
"Administration Supplement" means that certain 1999-A Supplement to
the Basic Administration Agreement, dated as of October 1, 1999, among the
parties to the Administration Agreement.
2
<PAGE> 6
"Agreement" means this Program Operating Lease, as amended or
supplemented from time to time.
"Basic Administration Agreement" means that certain administration
agreement, dated as of February 1, 1998, among the UTI Beneficiaries, the
Administrative Agent, the Maintenance Provider and the Origination Trustee.
"Indenture" has the meaning set forth in the Recitals.
"Lease Default" has the meaning set forth in Section 6.01.
"Lease Default Notice" has the meaning set forth in Section 7.01.
"Lease Payment" means the payment made by the Program Lessee on each
Deposit Date, in an amount equal to the payments made on or in respect of the
1999-A Leases and 1999-A Vehicles during the related Collection Period as
comprise (i) the Financial Component of the Fixed Charge received from the
related Lessees as part of the Total Monthly Payment and (ii) Termination Value
Payments made by Lessees following the exercise of the Annual Termination
Option.
"1999-A Leases" has the meaning set forth in the Recitals.
"1999-A Lease SUBI" has the meaning set forth in the Recitals.
"1999-A Lease SUBI Pledge" has the meaning set forth in Section
2.01(b).
"1999-A SUBI" and "1999-A SUBIs" have the meanings set forth in the
Recitals.
"1999-A SUBI Assets" means the 1999-A Vehicles and the 1999-A Leases.
"1999-A Vehicles" has the meaning set forth in the Recitals.
"1999-A Vehicle SUBI" has the meaning set forth in the Recitals.
"99% 1999-A Lease SUBI Certificate" has the meaning set forth in the
Recitals.
"99% 1999-A SUBI Certificates" has the meaning set forth in the
Recitals.
"99% 1999-A Vehicle SUBI Certificate" has the meaning set forth in the
Recitals.
"Lease Term" means the term of this Agreement.
"Leased Assets" has the meaning set forth in Section 2.01(a).
"Permitted Liens" means the respective rights and interests of the
Program Lessor and the Indenture Trustee in and to the 99% 1999-A SUBI
Certificates and this Agreement pursuant to the Basic Documents, including the
rights of any permitted assignee of the Program Lessor or the Indenture
Trustee.
3
<PAGE> 7
"SUBI Trust Agreement" has the meaning set forth in the Recitals.
"Termination Date" means the date of the termination of this
Agreement, which shall be 60 days after the latest Maturity Date of any 1999-A
Lease as of the Cutoff Date.
"Trust Agreement" has the meaning set forth in the Recitals.
Section 1.02. Interpretive Provisions.
(a) For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, (i) terms used herein
include, as appropriate, all genders and the plural as well as the singular,
(ii) references to words such as "herein", "hereof" and the like shall refer to
this Agreement as a whole and not to any particular part, article or section
within this Agreement, (iii) references to a section such as "Section 1.01" and
the like shall refer to the applicable section of this Agreement, (iv) the term
"include" and all variations thereof shall mean "include without limitation"
and (v) the term "or" shall include "and/or".
(b) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given to
them under generally accepted accounting principles. 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.
4
<PAGE> 8
ARTICLE TWO
LEASE OF 99% VEHICLE SUBI CERTIFICATE
Section 2.01. Lease of Vehicle SUBI Certificate.
(a) Subject to the terms and conditions hereof, the Program Lessor
hereby agrees to lease to the Program Lessee, and the Program Lessee hereby
agrees to lease from the Program Lessor, for the Lease Term, the Program
Lessor's 99% undivided beneficial interest in the 1999-A Vehicles and the 99%
1999-A Vehicle SUBI Certificate representing that interest, including the right
to receive all payments made on or in respect of the 1999-A Vehicles and the
99% 1999-A Vehicle SUBI Certificate and all proceeds thereof during the Lease
Term (collectively, the "Leased Assets"). Notwithstanding the foregoing, this
Agreement is subject to the security interest herein granted pursuant to the
Indenture by the Program Lessor to the Indenture Trustee.
(b) The 99% 1999-A Vehicle SUBI Certificate shall be delivered to the
Program Lessor in connection with the execution of the Issuer SUBI Certificate
Transfer Agreement. The 99% 1999-A Lease SUBI Certificate shall be pledged and
delivered to the Program Lessor pursuant to Section 2.04 hereof (the "1999-A
Lease SUBI Pledge"). Possession of the 99% 1999-A SUBI Certificates shall then
immediately be delivered to the Indenture Trustee. Thereafter, until the Lien
of the Indenture is released, the Indenture Trustee will maintain physical
possession of the 99% 1999-A SUBI Certificates for the benefit of the Senior
Noteholders; provided, that the Program Lessee shall continue to have all
rights with respect to the 99% 1999-A Vehicle SUBI Certificate set forth in
this Agreement and, subject to the lien of the 1999-A Lease SUBI Pledge and the
Indenture, all rights with respect to the 99% 1999-A Lease SUBI Certificate. To
the extent the Program Lessee has physical possession of the 99% 1999-A Vehicle
SUBI Certificate, the Program Lessee shall at the end of the Lease Term deliver
the 99% 1999-A Vehicle SUBI Certificate to the Program Lessor. Upon such
delivery, the Program Lessee shall be deemed to transfer, assign, set over and
otherwise convey to the Program Lessor, without recourse, representation or
warranty, all right, title and interest of the Program Lessee in and to the
Leased Assets, including the 99% 1999-A Vehicle SUBI Certificate, all monies
due or to become due with respect thereto after the date of such delivery and
all proceeds thereof. Such delivery shall satisfy the Program Lessee's
obligations pursuant to this Agreement.
(c) At the time of the return of the Leased Assets by the Program
Lessee to the Program Lessor, the 99% 1999-A Vehicle SUBI Certificate shall, at
the cost and expense of the Program Lessee, be free and clear of all Liens,
other than Permitted Liens.
Section 2.02. Representations, Warranties and Covenants of Program
Lessor. As of the date hereof, the Program Lessor hereby represents and
warrants to the Program Lessee that (i) immediately prior to the lease of the
Leased Assets to the Program Lessee, it had good title to and was the sole
legal and beneficial owner of the 99% 1999-A Vehicle SUBI Certificate and it's
interest in the Leased Assets was free and clear of Liens other than Permitted
Liens and (ii) during the Lease Term, so long as no Lease Default shall have
occurred and be continuing, the Program Lessee's receipt and quiet enjoyment of
the benefits of the payments on or in respect of the 99% 1999-A SUBI
Certificates (subject to the 1999-A Lease SUBI Pledge and the Lien of the
Indenture) shall not be interrupted or disturbed by the Program Lessor or any
Person claiming by, through or under the Program Lessor.
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<PAGE> 9
Section 2.03. Program Lessee's Rights. So long as no Lease Default
shall have occurred and be continuing, in exchange for the payment of the Lease
Payments, the Program Lessee shall enjoy all of the rights to the Leased Assets
and, except as otherwise provided in the Basic Documents, shall have the
exclusive claim (subject to the Lien of the Indenture) to receive all
distributions and proceeds with respect to the Leased Assets, including the 99%
1999-A Vehicle SUBI Certificate. Such Lease Payments shall be applied by the
Program Lessor to make any payment required to be made by the Program Lessor
under the Basic Documents. For purposes of the SUBI Trust Agreement, the
parties hereto and each of their respective permitted assigns shall each be
deemed a Holder, but the Program Lessee and its permitted assigns shall
indemnify the Program Lessor against any Liabilities pursuant to Section 3.07
of the SUBI Trust Agreement. Upon the occurrence and during the continuance of
a Lease Default, the Program Lessee shall no longer have any right to vote or
direct actions with respect to any of the Basic Documents.
Section 2.04. Pledge and Grant of Security Interest in 99% 1999-A
Lease SUBI Certificate. In order to secure payment by the Program Lessee of the
Lease Payments required pursuant to Section 3.02, the Program Lessee hereby
pledges and assigns to the Program Lessor and grants to the Program Lessor a
security interest in, all of Program Lessee's right, title and interest in and
to the 99% 1999-A Lease SUBI Certificate, together with all rights appurtenant
thereto and proceeds thereof.
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ARTICLE THREE
LEASE TERM AND PAYMENTS
Section 3.01. Term. The Lease Term shall begin as of the Closing Date
and shall end on the Termination Date. Notwithstanding the foregoing, this
Agreement shall expire with respect to each 1999-A Lease and the related 1999-A
Vehicle on the earliest to occur of (i) the related Maturity Date, (ii) the
effective date of the exercise by the Administrative Agent or the related
Lessee of the Annual Termination Option, (iii) the date of the Administrative
Agent's termination of such 1999-A Lease pursuant to a Special Event Purchase,
(iv) the date on which such 1999-A Lease becomes a Default Termination Lease,
(v) the date on which such 1999-A Lease becomes a Casualty Termination Lease or
(vi) the date on which the Administrative Agent is required to purchase such
1999-A Vehicle pursuant to Section 11.03(b)(ii), 11.03(b)(iii) or 11.03(c) of
the Administration Supplement.
Section 3.02. Payments.
(a) During the Lease Term, (i) the Program Lessee shall pay the Lease
Payment due on each Deposit Date to the Program Lessor and (ii) on any Deposit
Date, a Lease Payment shall be deemed to have been made by the Program Lessee
to the extent an amount equal to such Lease Payment has been deposited in the
SUBI Collection Account during the related Collection Period by the
Administrative Agent with respect of the 1999-A Leases and 1999-A Vehicles as
comprise (A) the Financial Component of the Fixed Charge received from the
related Lessees as part of the Total Monthly Payment and (B) Termination Value
Payments made by Lessees following the exercise of the Annual Termination
Option.
(b) Only rights to the Financial Component portion of the Fixed Charge
with respect to each 1999-A Lease shall be available to the Program Lessee to
make payments in respect of this Agreement. Payments in respect of the
Maintenance Component of Total Monthly Payments will be retained by or
otherwise paid to the Maintenance Provider as compensation for acting as
Maintenance Provider with respect to the 1999-A Vehicles, and will not be
available to make Lease Payments or to pay any other amounts payable by the
Program Lessee under this Agreement.
Section 3.03. Form of Payment. All payments due under this Agreement
shall be made to the Program Lessor, or to the Indenture Trustee in lieu of the
Program Lessor, in immediately available funds prior to 5:00 p.m., New York
City time, on the applicable Deposit Date.
Section 3.04. Tax Treatment. For federal and State income and
franchise tax purposes, the parties hereto agree (i) to treat the 99% 1999-A
SUBI Certificates as being owned by the Program Lessee and (ii) that the
Program Lessee is intended to be the owner of the 99% 1999-A SUBI Certificates.
Section 3.05. No Rights to Sublease or Renewal. Except as set forth in
Section 8.01, the Program Lessee shall not assign, pledge, sell, transfer,
sublease or otherwise dispose of its interest in the 99% 1999-A Vehicle SUBI
Certificate at any time. Except as provided pursuant to the Basic Documents,
the Program Lessee shall not transfer possession or relinquish control of the
99% 1999-A Vehicle SUBI Certificate. The Program Lessee may not renew the Lease
Term.
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ARTICLE FOUR
UNCONDITIONAL OBLIGATION; ADDITIONAL COLLATERAL
Section 4.01. Unconditional Obligation. The Program Lessee hereby
acknowledges and agrees that its obligation to make Lease Payments due
hereunder, and the rights of the Program Lessor in and to such Lease Payments,
shall be absolute and unconditional and shall not be affected by any
circumstance of any character, including:
(a) any set-off, abatement, counterclaim, suspension, recoupment,
reduction, defense or other right or claim that the Program Lessee may
have against the Program Lessor, the Origination Trustee, Indenture
Trustee, any Securityholder or any other Person for any reason
whatsoever;
(b) the breach or failure of any warranty or representation made
in, or the failure to perform or comply with any of the terms of, this
Agreement by the Program Lessor, the Origination Trustee, the
Indenture Trustee, any Securityholder or any other Person;
(c) any amendment or other change of, or any assignment of rights
under, this Agreement or any other Basic Document, or any waiver,
action or inaction under or in respect of this Agreement, or any
exercise or non-exercise of any right or remedy under this Agreement,
including the exercise of any foreclosure or other remedy under the
Indenture, this Agreement or the sale of any 99% 1999-A SUBI
Certificates or any part thereof or interest therein;
(d) any insolvency, bankruptcy or similar law affecting
creditors' rights generally;
(e) any claims as a result of any other business dealings by the
Program Lessor, the Program Lessee or their respective Affiliates or
the Indenture Trustee or the Origination Trustee;
(f) any defect in or any Lien on the title to any 99% 1999-A SUBI
Certificates or any part thereof;
(g) any change, waiver, extension, indulgence or other act or
omission in respect of any obligation or liability of the Program
Lessor or the Program Lessee;
(h) any alleged failure on the part of the Program Lessor to
perform or comply with any of the terms of any other Basic Document;
(i) any invalidity or unenforceability or disaffirmance of this
Agreement or any provision hereof or any of the other Basic Documents;
(j) any assignment, novation, merger, consolidation, sale or
transfer of assets, leasing or other similar transaction of or
affecting the Program Lessee or the Program Lessor, whether with or
without the approval of the Indenture Trustee, except as expressly
provided in this Agreement; or
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<PAGE> 12
(k) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing.
Each Lease Payment made by the Program Lessee hereunder shall be final
and, absent manifest error, the Program Lessee shall not seek to have any right
to recover all or any part of such payment from the Program Lessor for any
reason whatsoever. Notwithstanding the foregoing, in the event any Lessee under
a 1999-A Lease continues to make Monthly Payments after this Agreement has
expired with respect to the related 1999-A Vehicle pursuant to Section 3.01,
the Program Lessor shall credit such amounts against subsequent Lease Payments
due. The Program Lessee hereby waives, to the extent permitted by applicable
law, any and all rights it may now have or that at any time hereafter may be
conferred upon it, by statute or otherwise, to terminate, cancel, quit or
surrender this Agreement except in accordance with the express terms hereof.
Section 4.02. Assignment and Pledge of Certain Other Assets. The
Program Lessee acknowledges that its interest in the Leased Assets and the
related accounts under this Agreement is subject to the prior pledge by the
Program Lessor to the Indenture Trustee under the Indenture. The Program Lessee
hereby pledges and assigns and grants a security interest to the Issuer in any
and all of its right, title and interest in the 99% 1999-A SUBI Certificates to
secure its obligations under this Agreement.
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ARTICLE FIVE
LIENS; LOCATION AND INSPECTION
Section 5.01. Liens. The Program Lessee shall not directly or
indirectly create, assume or suffer to exist any Lien on or with respect to the
Leased Assets, any title thereto or any interest therein (including any rights
to payment), other than Permitted Liens. The Program Lessee shall promptly, at
its own expense, take such action as may be necessary to duly discharge any
such Lien (other than Permitted Liens).
Section 5.02. Change of Location. If, following the payment in full of
the Senior Notes and the release of the Lien of the Indenture, the Program
Lessee shall have obtained possession of the 99% 1999-A Vehicle SUBI
Certificate, then the Program Lessee shall provide the Program Lessor with
written notice of its intention to relocate the 99% 1999-A Vehicle SUBI
Certificate in accordance with the terms hereof at least one month prior to the
date such relocation is commenced. Notwithstanding the foregoing, no relocation
of the 99% 1999-A Vehicle SUBI Certificate by the Program Lessee shall be
commenced or made if a Lease Default shall have occurred and be continuing.
Section 5.03. Inspection and Information. At reasonable intervals
during the Lease Term and at any time at which a Lease Default has occurred and
is continuing, the Program Lessor and its representatives shall have the right,
but not the duty, to inspect the 99% 1999-A Vehicle SUBI Certificate and all
records relating thereto, including all records relating to the receipt or
distribution of funds with respect to the 99% 1999-A Vehicle SUBI Certificate.
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<PAGE> 14
ARTICLE SIX
LEASE DEFAULTS
Section 6.01. Lease Defaults. Any of the following acts or occurrences
shall constitute a default hereunder (each, a "Lease Default"):
(a) on any Deposit Date, the Program Lessee shall fail to make,
or cause to be made, to the Program Lessor, or the Indenture Trustee
or Origination Trustee, as the case may be, in lieu of the Program
Lessor, the Lease Payment due on such Deposit Date, and such default
shall continue for a period of 15 days or more after written notice
thereof shall have been given to the Program Lessee by the Program
Lessor;
(b) the Program Lessee shall breach a material representation or
warranty, or fail to perform any covenant contained in Articles Two or
Five;
(c) the Program Lessee shall default in the due performance and
observance of any of its covenants or agreements in this Agreement,
which default materially and adversely affects the rights of the
Program Lessor or its interest in the 99% 1999-A Vehicle SUBI
Certificate or the 99% 1999-A Lease SUBI Certificate, and such default
shall continue for a period of 30 days after written notice thereof
shall have been given to the Program Lessee by the Program Lessor;
(d) any representation, warranty or statement of the Program
Lessee made in this Agreement or any other Basic Document, or any
certificate, report or other writing delivered pursuant to this
Agreement or an Administration Supplement shall prove to have been
incorrect when made, which has a material adverse effect on the
Program Lessor or its interest in the 99% 1999-A Vehicle SUBI
Certificate or the 99% 1999-A Lease SUBI Certificate and such material
adverse effect shall continue for a period of 30 days after written
notice thereof shall have been given to the Program Lessee by the
Program Lessor or by the Indenture Trustee;
(e) (i) the existence of any proceeding or action involving, or
the entry of a decree or order for relief by a court or regulatory
authority having jurisdiction over the Program Lessee in, an
involuntary case under the federal bankruptcy laws, as now or
hereafter in effect, or the appointment of a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official
of the Program Lessee or of any substantial part of its property, or
the ordering of the winding up or the liquidation of the affairs of
the Program Lessee and the continuance of any such action, proceeding,
decree or order unstayed and, in the case of any such order or decree,
in effect for a period of 60 consecutive days or (ii) the commencement
by the Program Lessee of a voluntary case under the federal bankruptcy
laws, as now or hereafter in effect, or the consent by the Program
Lessee to the appointment of or taking of possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other
similar official of the Program Lessee or of any substantial part of
its property or the making by the Program Lessee of an assignment for
the benefit of creditors or the failure by the Program Lessee
generally to pay its debts as such debts become due or the taking of
action by the Program Lessee in furtherance of any of the foregoing;
or
(f) there shall occur an Indenture Default.
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ARTICLE SEVEN
REMEDIES
Section 7.01. Remedies. Upon the occurrence and during the continuance
of a Lease Default, the Program Lessor (or, if the Lien of the Indenture is
outstanding, the Indenture Trustee as assignee of the Issuer) may, with respect
to any Lease Default described in Section 6.01(a), (b), (c), (d) and (f), at
its option, declare this Agreement to be in default by written notice to such
effect given to the Program Lessee (a "Lease Default Notice"), and upon the
occurrence of a Lease Default described in Section 6.01(e), this Agreement
shall automatically be in default, and at any time thereafter the Program
Lessor may, to the extent permitted by law, exercise one or more of the
following remedies as the Program Lessor in its sole discretion shall elect:
(a) by notice to the Program Lessee, rescind or terminate this
Agreement;
(b) demand, if the Program Lessee has possession of the 99%
1999-A Vehicle SUBI Certificate (or the 99% 1999-A Lease SUBI
Certificate) that the Program Lessee, and the Program Lessee shall
upon such demand, redeliver the 99% 1999-A Vehicle SUBI Certificate
(or the 99% 1999-A Lease SUBI Certificate) to the Program Lessor;
(c) subject to the terms of the Trust Agreement and the
Indenture, sell (which action may be taken by the Indenture Trustee,
subject to Section 5.04(a) of the Indenture) the 99% 1999-A Vehicle
SUBI Certificate or the 99% 1999-A Lease SUBI Certificate at public or
private sale, as the Program Lessor may determine, in its sole
discretion free and clear of any rights of the Program Lessee in the
99% 1999-A Vehicle SUBI Certificate or the 99% 1999-A Lease SUBI
Certificate and without any duty to account to the Program Lessee with
respect to such action or inaction or any proceeds with respect
thereto; provided, that the Program Lessee shall be entitled to
receive any proceeds of such sale remaining after payment in full of
the expenses of such sale and any expenses of the Program Lessee, the
Program Lessor, the Indenture Trustee or the Origination Trustee that
have not been otherwise paid; or
(d) whether or not the Program Lessor shall have exercised or
shall thereafter at any time exercise its rights under Section
7.01(b), demand, by written notice to the Program Lessee, that the
Program Lessee, and the Program Lessee shall upon such demand, pay to
the Program Lessor, or, if the Lien of the Indenture is outstanding,
the Indenture Trustee as assignee of the Issuer, on the Payment Date
next succeeding such notice, any unpaid Lease Payments due through
such Payment Date; provided, however, that the Program Lessor may
exercise the remedy set forth in this paragraph only in the event the
Senior Notes have been declared immediately due and payable pursuant
to Section 5.02 of the Indenture, and such declaration has not been
rescinded or annulled.
Upon any termination of this Agreement, the Program Lessor shall
directly receive all distributions with respect to, or shall have the right to
sell, the 99% 1999-A Vehicle SUBI Certificate or the 99% 1999-A Lease SUBI
Certificate and to apply the funds received in respect thereof to pay interest
on and principal of the Securities, subject to the provisions of the other
Basic Documents.
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If the maturity of the Senior Notes has been accelerated following a
Lease Default, the Indenture Trustee, as assignee of the Issuer, shall be
entitled to demand that the Program Lessee pay all previously due but as yet
unpaid Lease Payments plus, as liquidated damages, an amount equal to the sum
of (i) any interest due and unpaid on the Securities, (ii) the unpaid principal
balance of the Securities and (iii) any other amounts payable by the Program
Lessee under the Basic Documents. Upon payment of such amounts, the Program
Lessee shall be entitled to receive the 99% 1999-A Vehicle SUBI Certificate and
the release of the pledged 99% 1999-A Lease SUBI Certificate.
Section 7.02. No Release. No (i) rescission or termination of this
Agreement in whole or in part, (ii) repossession of the 99% 1999-A Vehicle SUBI
Certificate or foreclosure of the lien on the 99% 1999-A Lease SUBI Certificate
or (iii) exercise of any remedy under Section 7.01 shall, except as
specifically provided therein, relieve the Program Lessee of any of its
liabilities or obligations hereunder. In addition, the Program Lessee shall be
liable, except as otherwise provided herein, for any and all unpaid Lease
Payments, if any, due hereunder before, after or during the exercise of the
foregoing remedies, including all reasonable legal fees and other costs and
expenses incurred by the Program Lessor.
Section 7.03. Remedies Cumulative. No remedy under Section 7.01 is
intended to be exclusive, but each shall, to the fullest extent permitted by,
but subject to any mandatory requirements of, any applicable law or government
regulation, be cumulative and in addition to any other remedy provided under
Section 7.01 or otherwise available to the Program Lessor at law or in equity.
No express or implied waiver by the Program Lessor of any Lease Default shall
in any way be, or be construed to be, a waiver of any future or subsequent
Lease Default. The failure or delay of the Program Lessor in exercising any
rights granted to it hereunder or under any other Basic Document upon any
occurrence of any of the contingencies set forth herein shall not constitute a
waiver of any such right upon the continuation or recurrence of any such
contingency or similar contingency, and any single or partial exercise of any
particular right by the Program Lessor shall not exhaust the same or constitute
a waiver of any other right provided herein.
Section 7.04. Exercise of Other Rights or Remedies. In addition to all
other rights and remedies provided in this Article, the Program Lessor may
exercise any other rights or remedies that may be available to it under
applicable law or proceed by appropriate court action to enforce the terms
hereof or to recover damages for the breach hereof.
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ARTICLE EIGHT
ASSIGNMENT OF PROGRAM OPERATING LEASE
Section 8.01. Assignment of Program Operating Lease by Program Lessor.
(a) The Program Lessee hereby acknowledges, and consents in all
respects to, the assignment of the interest of the Program Lessor in this
Agreement by the Program Lessor to the Indenture Trustee under and pursuant to
the Indenture, and agrees:
(i) to make each Lease Payment due or to become due hereunder
directly to the Indenture Trustee or Origination Trustee, as the case
may be, to the account specified by the Indenture Trustee, so long as
any Securities shall be outstanding and unpaid; and
(ii) not to seek to recover any payment (other than a payment
made in error) made to the Indenture Trustee or Origination Trustee,
as the case may be, in accordance with the Indenture once such payment
is made.
(b) The Program Lessee hereby consents to and acknowledges the
retention of possession by the Indenture Trustee of the 99% 1999-A SUBI
Certificates until such time as the Senior Notes are paid in full and the Lien
of the Indenture is released.
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ARTICLE NINE
MISCELLANEOUS
Section 9.01. Notices. All demands, notices and communications
hereunder shall be in writing and shall be delivered or mailed by registered or
certified first-class United States mail, postage prepaid, hand delivery,
prepaid courier service or by telecopier, and addressed in each case as
follows: (i) if to the Program Lessor, c/o Chase Manhattan Bank Delaware, at
1201 Market Street, Wilmington, Delaware 19801 (telecopier no. (302) 984-4903),
Attention: Corporate Trust Department; (ii) if to the Program Lessee, at 3600
N.W. 82nd Avenue, Miami, Florida 33166 (telecopier no. (305) 500-3726),
Attention: Treasurer; or (iii) at such other address as shall be designated by
any of the foregoing in a written notice to the other parties hereto. Delivery
shall occur only upon receipt or reported tender of such communication by an
officer of the recipient entitled to receive such notices located at the
address of such recipient for notices hereunder. All demands, notices and
communications hereunder shall, so long as the 99% 1999-A Vehicle SUBI
Certificate or the 99% 1999-A Lease SUBI Certificate is subject to the Lien of
the Indenture, be given to the Indenture Trustee as well as to the appropriate
party hereunder.
Section 9.02. Distribution of Vehicle SUBI Assets. The Program Lessor
and Program Lessee agree that each shall be a Holder of the 99% 1999-A Vehicle
SUBI Certificate and the 99% 1999-A Lease SUBI Certificate for purposes of the
SUBI Trust Agreement and that, for so long as this Agreement is in effect, each
shall exercise their joint rights provided for in the SUBI Trust Agreement only
with the consent of the other.
Section 9.03. Successors and Assigns. Neither the Program Lessor nor
the Program Lessee may assign its interest in this Agreement except as
permitted by Section 8.01. This Agreement, including all agreements, covenants,
representations and warranties, shall be binding upon and inure to the benefit
of the Program Lessor and its successors and permitted assigns and the Program
Lessee and its successors and permitted assigns.
Section 9.04. Right to Perform for Program Lessee. If the Program
Lessee shall fail to make any Lease Payment required to be made hereunder, or
shall fail to perform or comply with any of its other agreements contained
herein or in any other Basic Document or any other agreement entered into in
connection therewith, the Program Lessor may, but shall not be obligated to,
make such payment or perform or comply with such agreement, and the amount of
such payment and the amount of all costs and expenses (including, without
limitation, reasonable attorneys' and other professionals' fees and expenses)
of the Program Lessor incurred in connection with such payment or the
performance of or compliance with such agreement, as the case may be, together
with interest thereon, at the Class A-4 Interest Rate, shall be due and payable
by the Program Lessee upon demand.
Section 9.05. Amendments. This Agreement may be amended without the
consent of the Securityholders; provided, however, (i) that such amendment may
not, as evidenced by an Opinion of Counsel, materially adversely affect the
interests of the Senior Noteholders or the Trust Certificateholders (unless
100% of the Senior Noteholders and the Trust Certificateholders materially
adversely affected consent thereto), (ii) subject to the satisfaction of the
Rating Agency Condition and (iii) an Opinion of Counsel is delivered to the
effect that after such amendment (a) the Origination Trust will not be
classified as an association (or a publicly traded partnership) taxable as a
corporation for federal income tax purposes and (b) the Trust Certificates will
properly be characterized as indebtedness that is secured by the assets of the
Origination Trust. Notwithstanding the foregoing, this Agreement may be amended
at any time by the parties hereto to the extent reasonably necessary to ensure
that none of the Origination Trust, the Issuer or the Program Lessee will be
classified as an association (or a publicly traded partnership) taxable as a
corporation for federal income tax purposes.
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Section 9.06. No Petition. Each of the parties hereto covenant and
agree that they will not institute, or join in instituting, any bankruptcy,
reorganization, arrangement, insolvency or liquidation Proceeding, or other
Proceeding under federal or State bankruptcy or similar laws for a period of
one year and a day after:
(a) payment in full of all amounts due to each Holder in respect
of the UTI, the 1999-A SUBIs or any Other SUBI, against any UTI
Beneficiary (or any general partner of any UTI Beneficiary which is a
partnership or any member of a UTI Beneficiary which is a limited
liability company), the Origination Trust and the Origination Trustee,
without the consent of 100% of the Holders of the 1999-A SUBIs and any
Other SUBIs (excluding the UTI Beneficiaries, the Transferor or any of
their respective Affiliates); and
(b) payment in full of the Offered Securities, against the
Transferor or the Issuer; provided, however, that 100% of the Senior
Noteholders, or, if no Senior Notes are then outstanding, the
Subordinated Noteholder and if no Subordinated Notes are then
outstanding, 100% of the Trust Certificateholders (in each case
excluding the Transferor and any of its Affiliates) may at any time
institute or join in instituting any bankruptcy, reorganization,
insolvency or liquidation proceeding against the Transferor or the
Issuer.
Section 9.07. Survival. All agreements, indemnities, representations
and warranties contained in this Agreement and the other Basic Documents or any
agreement, document or certificate delivered pursuant hereto or thereto or in
connection herewith or therewith shall survive the execution and delivery of
this Agreement and the expiration or other termination thereof.
Section 9.08. Severability. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements, provisions
or terms of this Agreement, and shall in no way affect the validity or
enforceability of the other covenants, agreements, provisions or terms of this
Agreement.
Section 9.09. Original. The single executed original of this Agreement
marked "Original" and containing the receipt of the Indenture Trustee thereon
shall be the "Original" of this Agreement. To the extent this Agreement
constitutes "chattel paper" as such term is defined in the UCC as in effect in
any applicable jurisdiction, no security interest in this Agreement may be
created through the transfer or possession of any counterpart other than the
"Original".
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Section 9.10. Single Transaction. The parties hereto acknowledge and
agree that the Basic Documents and any other agreements of the Program Lessee
entered into by the Program Lessee in connection with the transactions
contemplated by the Basic Documents are intended to be construed and treated
for all purposes as integral and constitutive elements of a single transaction
that cannot be separately assigned, assumed or rejected under the United States
bankruptcy code (Title 11 of the United States Code) or any other applicable
bankruptcy, insolvency or receivership laws.
Section 9.11. Table of Contents and Headings. The Table of Contents
and Article and Section headings herein are for convenience of reference only
and shall not define or limit any of the terms or provisions hereof.
Section 9.12. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
regard to any otherwise applicable principles of conflicts of laws (other than
Section 5-1401 of the New York General Obligations Law).
Section 9.13. Counterparts. This Agreement may be executed in any
number of counterparts, each of which so executed and delivered shall be deemed
to be an original, but all of which counterparts shall together constitute but
one and the same instrument.
Section 9.14. Limitation of Liability of Owner Trustee.
Notwithstanding anything contained herein to the contrary, this instrument has
been executed by Chase Manhattan Bank Delaware not in its individual capacity
but solely in its capacity as Owner Trustee of the Issuer and in no event shall
Chase Manhattan Bank Delaware in its individual capacity or any beneficial
owner of the Issuer have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder, as to all
of which recourse shall be had solely to the assets of the Issuer. For all
purposes of this Agreement, in the performance of any duties or obligations of
the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to
the benefits of, the terms and provisions of Articles Six, Seven and Ten of the
Trust Agreement. Notwithstanding anything herein to the contrary, Section 2.07
of the Trust Agreement shall remain in full force and effect.
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IN WITNESS WHEREOF, the parties hereto have caused this Program
Operating Lease to be duly executed by their respective officers hereunto duly
authorized, as of the day and year first above written.
RYDER FUNDING LP,
as Program Lessee
By: RYDER TRUCK RENTAL III LLC,
as General Partner
By: RTR LEASING II, INC.,
as Manager
By:
-------------------------------------------
Name:
Title:
RYDER VEHICLE LEASE TRUST 1999-A,
as Program Lessor
By: CHASE MANHATTAN BANK DELAWARE,
as Owner Trustee
By:
-------------------------------------------
Name:
Title:
18
<PAGE> 22
Receipt of this original counterpart of this Agreement is hereby
acknowledged on this ____ day of ___________ 1999.
U.S. BANK NATIONAL ASSOCIATION,
as Indenture Trustee
By:
-------------------------------------------
Name:
Title:
19
<PAGE> 1
EXHIBIT 23.4
Independent Auditors' Consent
RTRT Inc. as Trustee of Ryder Truck Rental LT
Chase Manhattan Bank Delaware, as
Owner Trustee for Ryder Vehicle Lease Trust 1999-A:
We consent to the use of our reports dated September 9, 1999 included herein
and to the reference to our firm under the heading "Experts" in the
registration statement.
KPMG LLP
Miami, Florida
October 14, 1999
