AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 7, 2000
REGISTRATION NO. 333-84579
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
WODFI LLC
(ORIGINATOR OF THE TRUST DESCRIBED HEREIN)
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
------------------------
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DELAWARE 65-0934017
(REGISTRANT'S STATE OR OTHER JURISDICTION OF (REGISTRANT'S I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
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WODFI LLC A. TUCKER ALLEN
120 N.W. 12TH AVENUE 120 N.W. 12TH AVENUE
DEERFIELD BEACH, FL 33442 DEERFIELD BEACH, FL 33442
(954) 429-2200 (954) 429-2200
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) INCLUDING AREA CODE, OF AGENT FOR SERVICE)
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Copies to
JEFFREY S. O'CONNOR
KIRKLAND & ELLIS
200 EAST RANDOLPH DRIVE
CHICAGO, ILLINOIS 60601
(312) 861-2000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement as determined by
the Registrant in light of market conditions. If the only securities being
registered on this form are being offered pursuant to dividend or interest
reinvestment plans, please check the following box. / /
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 Securities Act of 1933,
other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /x/
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 PROPOSED
TITLE OF EACH CLASS AMOUNT TO BE MAXIMUM OFFERING MAXIMUM AGGREGATE
OF SECURITIES TO BE REGISTERED REGISTERED PRICE PER UNIT(1) OFFERING PRICE(1)
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Asset Backed Notes..................................... $1,000,000,000 100% $ 1,000,000,000
<CAPTION>
TITLE OF EACH CLASS AMOUNT OF
OF SECURITIES TO BE REGISTERED REGISTRATION FEE
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Asset Backed Notes..................................... $263,736(2)
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(1) Estimated solely for purposes of calculating the registration fee.
(2) Net of the $278 of such fee which has been previously paid.
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 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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SUBJECT TO COMPLETION, DATED MARCH 7, 2000
PROSPECTUS
WORLD OMNI MASTER OWNER TRUST
ISSUER
WODFI LLC
TRANSFEROR
WORLD OMNI FINANCIAL CORP.
SERVICER
ASSET BACKED NOTES
- -------------------- THE TRUST--
BEFORE YOU o may periodically issue asset backed notes in one
PURCHASE ANY OF or more series;
THE NOTES, YOU
SHOULD CAREFULLY o will own--
CONSIDER THE RISK
FACTORS BEGINNING o receivables arising from a selected portfolio of
ON PAGE 9 IN THIS automobile dealer revolving floorplan financing
PROSPECTUS. agreements;
o payments due on those receivables; and
o other property described in this prospectus and
The sole source in the prospectus supplement; and
of payments on the
notes is the o will not own the dealer accounts from which the
assets of the receivables arise.
trust. The notes
are not interests THE NOTES--
in or obligations of
World Omni o will represent indebtedness secured by the assets
Financial Corp., of the trust;
WODFI LLC or any
other entiry or o will be paid only from the assets of the trust;
person.
o will represent the right to payments in the amounts
This prospectus and at the times described in the prospectus
may be used to supplement for that series;
offer and sell
any series of o offered by this prospectus will be rated investment
notes only if grade by at least one nationally recognized rating
accompanied by the agency;
prospectus
supplement for o may benefit from one or more forms of credit
that series. enhancement; and
- --------------------
o may be issued as part of a designated series which
may include one or more classes.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE NOTES OR DETERMINED IF THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
, 2000
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
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
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[Intentionally Left Blank]
2
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TABLE OF CONTENTS
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WHERE TO FIND INFORMATION IN THIS PROSPECTUS AND
THE PROSPECTUS SUPPLEMENT...................... 5
SUMMARY.......................................... 6
The Parties.................................... 6
Securities to be Issued by the Trust........... 6
Payments on the Notes.......................... 6
Assets of the Trust............................ 7
Servicing Fees................................. 8
Tax Status..................................... 8
ERISA Considerations........................... 8
Ratings........................................ 8
RISK FACTORS..................................... 9
THE SERVICER..................................... 14
THE TRANSFEROR................................... 14
THE TRUST........................................ 15
The Owner Trustee.............................. 16
USE OF PROCEEDS.................................. 17
THE DEALER FLOORPLAN FINANCING BUSINESS.......... 17
Creation of Receivables........................ 17
Credit Approval and Credit
Guidelines.................................. 18
Payment Terms.................................. 20
Billing and Collection Procedures.............. 21
Dealer Monitoring.............................. 21
Intercreditor Agreement for Security Interests
in Vehicles and Non-Vehicle Collateral
Security.................................... 23
Participation Agreements....................... 23
Participation Interests Purchased by World
Omni........................................ 23
Relationship with Affiliates................... 23
THE ACCOUNTS..................................... 24
THE NOTES........................................ 25
General........................................ 25
Interest....................................... 25
Principal...................................... 26
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The Indenture and the Series Supplements....... 28
Excluded Series................................ 33
Collection Account............................. 34
Excess Funding Account......................... 37
Allocation Percentages......................... 38
Allocation of Collections; Deposits in
Collection Account.......................... 39
Subordination of Certificate; Enhancements..... 40
Distributions.................................. 41
New Issuances.................................. 41
The Indenture Trustee.......................... 42
Reports to Noteholders......................... 43
Book-Entry Registration........................ 43
Definitive Notes............................... 46
THE TRANSFER AND SERVICING
AGREEMENTS..................................... 47
Receivables Purchase Agreement................. 48
Conveyance of Receivables and Collateral
Security.................................... 50
Representations and Warranties by the
Transferor.................................. 51
Eligible Accounts and Eligible Receivables..... 52
Ineligible Receivables and Excess
Receivables................................. 54
Addition of Accounts........................... 54
Removal of Accounts; Transfers of
Participations.............................. 56
The Certificates............................... 59
Defaulted Receivables and
Recoveries.................................. 59
Optional Repurchase............................ 60
Investment Events and Early Amortization
Events...................................... 61
Termination; Fully Funded Date................. 62
Indemnification................................ 62
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Collection and Other Servicing Procedures...... 63
Servicer Covenants............................. 64
Servicing Compensation and Payment of
Expenses.................................... 65
Certain Matters Regarding the
Servicer.................................... 65
Servicing Default.............................. 66
Rights Upon Servicing Default.................. 67
Waiver of Past Defaults........................ 67
Reports........................................ 67
Evidence as to Compliance...................... 68
Amendments..................................... 68
Intercreditor Arrangements..................... 69
Administration Agreement....................... 70
CERTAIN ADMINISTRATIVE AND LEGAL
PROCEEDINGS.................................... 70
CERTAIN LEGAL ASPECTS OF THE RECEIVABLES......... 71
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Transfer of Receivables........................ 71
Certain Matters Relating to
Bankruptcy.................................. 72
CERTAIN FEDERAL INCOME TAX CONSEQUENCES.......... 73
General........................................ 73
Tax Characterization and Treatment of Notes.... 73
Tax Characterization of the Trust.............. 76
STATE AND LOCAL TAX CONSEQUENCES................. 78
ERISA CONSIDERATIONS............................. 78
PLAN OF DISTRIBUTION............................. 79
LEGAL OPINIONS................................... 80
WHERE YOU CAN FIND MORE INFORMATION.............. 80
INCORPORATION BY REFERENCE....................... 81
INDEX OF TERMS................................... 82
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WHERE TO FIND INFORMATION IN THIS PROSPECTUS AND THE
PROSPECTUS SUPPLEMENT
We provide information to you about the notes in two separate documents
that provide varying levels of detail:
(a) this prospectus, which provides general information, some of which may
not apply to a particular series of notes, including your series; and
(b) the prospectus supplement for a series of notes, which will provide
financial and other information regarding the pool of receivables held
by the trust and will specify the terms of a particular series of
notes, including:
o which classes of the series are being offered;
o the timing of interest and principal payments for each class of the
series;
o the priority of interest and principal payments for each class of
the series;
o information about credit enhancement for each class of the series,
if any;
o the ratings for each class of the series; and
o the method for selling each class of the series.
IF THE TERMS OF YOUR SERIES OF NOTES VARY BETWEEN THIS PROSPECTUS AND THE
PROSPECTUS SUPPLEMENT FOR THAT SERIES, YOU SHOULD RELY ON THE INFORMATION IN THE
PROSPECTUS SUPPLEMENT.
You should rely only on the information provided in this prospectus and the
prospectus supplement for your series of notes. We have not authorized anyone to
provide you with other or different information. You should not assume that the
information in this prospectus and any prospectus supplement is accurate on any
date other than the dates stated on their respective covers.
We are not offering the notes in any state where the offer is not
permitted.
You can find a list of the pages where capitalized terms used in this
prospectus are defined under the caption 'Index of Terms' which appears at the
end of this prospectus.
We include cross-references in this prospectus to captions in this
prospectus where you can find further related discussions.
5
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SUMMARY
This summary highlights selected information from this prospectus and
provides an overview to aid in your understanding of the notes. It does not
contain all of the information that you need to consider in making your
investment decision. To understand all of the terms of a series of notes,
carefully read this entire prospectus and the prospectus supplement for that
series.
THE PARTIES
ISSUER/TRUST
World Omni Master Owner Trust, a Delaware business trust formed by the
Transferor and the Owner Trustee.
TRANSFEROR
WODFI LLC, a Delaware limited liability company and a wholly-owned
subsidiary of World Omni Financial Corp.
SERVICER
World Omni Financial Corp., a Florida corporation and a wholly-owned
subsidiary of JM Family Enterprises, Inc.
OWNER TRUSTEE
The Owner Trustee is Chase Manhattan Bank Delaware, a Delaware banking
corporation.
INDENTURE TRUSTEE
The Indenture Trustee is Harris Trust and Savings Bank, an Illinois
banking corporation.
SECURITIES TO BE ISSUED BY THE TRUST
NOTES
The trust will issue one or more series of notes. The prospectus
supplement will contain additional information about the notes, including the
classes of notes offered in the series. The trust has previously issued series
of notes. Each series of notes may include one or more classes. The trust may
issue additional series of notes after the issuance of notes offered by this
prospectus.
THE CERTIFICATES
The trust has also issued certificates. The certificates are not being
offered for sale by this prospectus and are currently held by the Transferor.
SUBORDINATION
A portion of the certificates will be subordinated to a series of notes
to the extent described in this prospectus and the prospectus supplement for
the series.
One or more classes of notes of a series may be subordinate to one or
more classes of notes. The relative priority of each series and class of notes
will be described in the prospectus supplement for that series.
PAYMENTS ON THE NOTES
INTEREST
The trust will pay interest on the notes with the frequency as is
specified in the prospectus supplement for that series. Each series or class
of notes will have its own interest rate, which may be fixed, variable,
contingent, adjustable or any combination of these characteristics. The
interest rate or the method for determining the interest rate for a series or
class of notes will be specified in the prospectus supplement for that series.
The sources of funds the trust will use to pay interest on a series or
class of notes will be specified in the prospectus supplement for that series.
Typically, these sources will include:
o interest collections on the receivables held by the trust
o servicer advances
o available credit enhancement
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PRINCIPAL
Each series or class of notes will have a stated principal amount.
Ordinarily, principal payments on the notes will occur on one or more
dates specified in the prospectus supplement for that series. The sources of
funds the trust will use to pay principal will be specified in the prospectus
supplement for that series. Typically, these sources will include:
o all or a portion of the principal collections on the receivables held by
the trust
o servicer advances
o all or a portion of the interest collections remaining after interest
payments
o available credit enhancement
The manner in which the trust will apply available funds toward principal
payments on a series of notes will be set forth in the prospectus supplement
for that series.
Each series of notes will have a revolving period during which no
principal payments are made. Among the possible ways principal payments may be
made are the following:
o a single targeted final payment date, on which all principal is repaid at
once
o a controlled amortization period, during which a predetermined amount of
principal is repaid on each specified payment date until all principal has
been repaid
o an index amortization period, during which the amount of principal that is
repaid is determined by reference to an index
However, it is possible that principal payments on a class or series of
notes will begin earlier than the date specified in the prospectus supplement
for that series. Upon the occurrence of an early amortization event for a
series of notes, the trust will apply all funds allocated to that series to
the repayment of the outstanding principal of and interest on the notes and
the other securities, if any, in that series, unless the prospectus supplement
for that series provides that those funds will be set aside for payment on a
later date. An early amortization event will likely result in an earlier
commencement of the repayment of principal on the notes than the date
specified in the prospectus supplement for that series. In addition, an early
amortization event may result in delays or reductions in the payments on your
notes.
ASSETS OF THE TRUST
The primary assets of the trust consist of a revolving pool of
receivables arising under selected revolving floorplan financing agreements
entered into with World Omni by retail automotive dealers to finance their
inventory of new and used automobiles and light duty trucks and may also
include participation interests in financing arrangements of a third party.
Receivables are sold by World Omni to the Transferor, and are then
transferred by the Transferor to the trust. The Trust has granted a security
interest in the receivables and the other property of the trust to the trustee
under the indenture for the notes for the benefit of the noteholders. The
trust property also includes:
o security interests in the collateral securing the dealers' obligations to
pay the receivables, which will include unsold vehicles and which may
include parts inventory, equipment, fixtures, service accounts, real
estate and guarantees;
o amounts held on deposit in specified trust accounts maintained for the
trust or for a series or class of notes;
o recourse World Omni may have against the dealers under the financing
agreements;
o an assignment of the Transferor's rights under its purchase agreement with
World Omni; and
o any additional property, or exclusions of the foregoing types of property,
described in the prospectus supplement.
7
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As new receivables arise under the selected financing agreements, they
generally will be transferred to the trust on a daily basis. Prior to the date
on which funds are required to be set aside for payment on a series of notes,
the trust generally will transfer the principal collections on the receivables
to the Certificateholders, provided there are sufficient assets in the trust.
If there are insufficient assets in the trust, the trust will retain the
principal collections and invest them in eligible investments.
However, if a cash accumulation event specified in the prospectus
supplement for a series of notes occurs, the trust will retain all or a
portion of the principal collections and invest them in eligible investments
in a cash accumulation account dedicated to the noteholders of that series for
future payment on the notes of that series.
SERVICING FEES
For each series of notes, the trust will pay the servicer a set monthly
fee as compensation for servicing the receivables, as set forth in the related
prospectus supplement.
TAX STATUS
Kirkland & Ellis, special tax counsel, is of the opinion that, for
federal income tax purposes, the notes will be characterized as indebtedness
and the trust will not be characterized as an association (or publicly traded
partnership) taxable as a corporation.
By accepting a note, you agree to treat the notes as indebtedness for
federal, state and local income and franchise tax purposes.
See 'Certain Federal Income Tax Consequences' and 'State and Local Tax
Consequences' in this prospectus concerning the application of federal, state
and local tax laws.
ERISA CONSIDERATIONS
Subject to the considerations discussed under 'ERISA Considerations,' an
employee benefit plan regulated by the Employee Retirement Income Security Act
of 1974 may purchase the notes, including any subordinated notes. See 'ERISA
Considerations' for a description of the limitations on the purchase of notes
by employee benefit plans. Employee benefit plans should consult with their
counsel before purchasing any notes.
RATINGS
All of the notes offered under this prospectus will be rated investment
grade by at least one nationally recognized rating agency. Ratings for a
series or class of notes offered under this prospectus will be described in
the prospectus supplement for that series.
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RISK FACTORS
You should consider carefully the following risk factors in deciding
whether to purchase the notes.
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DEALER CONCENTRATION MAY RESULT IN
LARGER LOSSES FROM A SINGLE DEALER
DEFAULT As of September 30, 1999, World Omni provided new and used car floorplan
financing for approximately 239 dealers or dealer groups. Although no dealer or
dealer group accounted for more than 7.74% of the aggregate principal amount of
the outstanding receivables as of September 30, 1999, approximately 38.60% of the
aggregate principal amount of the receivables outstanding as of that date were
generated by the 8 largest dealers or dealer groups. A default by one or more of
these dealers or dealer groups could result in delays or reductions in payments
on your notes. In addition, as of September 30, 1999, approximately $31.7 million
of receivables were generated by dealers or dealer groups affiliated with JM
Family Enterprises.
RECEIVABLES MAY BE UNCOLLECTIBLE DUE
TO SUPERIOR INTERESTS World Omni and the Transferor will file financing statements covering the
receivables sold by World Omni to the Transferor and then transferred to the
trust. The financing statements will perfect the security interests of the
Transferor and the trust in the receivables. However, World Omni will serve as
the custodian of the receivables and will not physically segregate or mark the
receivables to indicate that they have been sold to the Transferor and then
transferred to the trust. See 'The Transfer and Servicing Agreements--Conveyance
of Receivables and Collateral Security.'
If the receivables are 'chattel paper' under the Uniform Commercial Code and
another party purchases or takes a security interest in the receivables for
value, in the ordinary course of business and without actual knowledge of the
Transferor's or the trust's interest, that purchaser or secured party will
acquire an interest in the receivables superior to the trust's interest. The
trust will not be able to collect on the receivable if there is a superior
interest. This may result in delays or reductions in payments on your notes. See
'Certain Legal Aspects--Transfer of Receivables.'
RECEIVABLES MAY BE UNSECURED DUE TO
SALES OUT OF TRUST Dealers give World Omni a security interest in the vehicles they purchase to
secure their obligations under the receivables. When the financed vehicle is
sold, World Omni's security interest in the vehicle generally will terminate. If
the dealer who sold the vehicle fails to pay World Omni the amount owed on the
receivable, the receivable will become unsecured because the buyer generally
takes the vehicle free of the security interest. If the financed vehicle is sold
'out of trust,' i.e., sold without the dealer applying the proceeds of the sale
to repay the receivable, the trust will not be able to foreclose on the financed
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vehicle. This may result in delays or reductions in payments on your notes.
A BANKRUPTCY OF WORLD OMNI OR THE
TRANSFEROR MAY DELAY OR REDUCE
PAYMENTS ON THE NOTES World Omni will sell receivables to the Transferor, and the Transferor will
transfer the receivables to the trust. Although World Omni and the Transferor
have taken steps, such as the creation of the Transferor as a special purpose
entity, to ensure that the transactions described in this prospectus are
respected, and to reduce the likelihood that the Transferor would voluntarily
file for bankruptcy, if World Omni or the Transferor were to become a debtor in
bankruptcy, a court could conclude that the receivables transferred to the trust
are not owned by the trust, but rather are part of the estate of the debtor in
bankruptcy. The court may conclude that the transfer of the receivables from the
party in bankruptcy was not really a sale, but rather a secured financing, or the
court may conclude that the party in bankruptcy and the owner of the receivables
should be treated as a single entity rather than separate entities. If this were
to occur, you could experience delays or reductions in payments on your notes as
a result of:
o the 'automatic stay' provisions of the U.S. Bankruptcy Code, which prevent
creditors from exercising remedies against a debtor in bankruptcy, and
provisions of the U.S. Bankruptcy Code that permit substitution of collateral
in specified circumstances;
o some tax or government liens on World Omni's or the Transferor's property that
arose prior to the transfer of a receivable to the trust having a right to be
paid from collections on the receivables before those collections are used to
make payments on your notes; and
o the fact that the trust or the indenture trustee may not have a perfected
security interest in the financed vehicles or cash collections on the
receivables held by World Omni at the time a bankruptcy proceeding begins.
If World Omni or the Transferor were to become a debtor in bankruptcy, it may be
able to recover payments made by it to the trust to repurchase receivables prior
to the date of the bankruptcy petition. This could result in delays or reductions
in payments on your notes.
In addition, if World Omni, any of its affiliates, or any of the manufacturers of
the related vehicles filed for bankruptcy, the dealers might respond by delaying
or withholding payments on the receivables, even without legal or contractual
justification. This could result in delays or reductions in payments on your
notes.
FAILURE OF SOUTHEAST TOYOTA
DISTRIBUTORS TO REPURCHASE VEHICLES
FROM TERMINATED DEALERS MAY RESULT
IN INCREASED LOSSES ON THE
RECEIVABLES Southeast Toyota Distributors, Inc., an affiliate of World Omni and the largest
distributor of vehicles to the dealers generating the receivables,
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is obligated to repurchase some of the dealer's vehicles if its dealership
agreement is terminated or expires. If Southeast Toyota Distributors is unwilling
or unable to repurchase those vehicles, losses on the receivables of those
dealers may increase. This could result in delays or reductions in payments on
your notes.
FAILURE OF WORLD OMNI TO GENERATE
SUFFICIENT NEW RECEIVABLES MAY
RESULT IN THE TRUST HOLDING ASSETS
WITH A LOWER YIELD The trust depends upon World Omni to generate new receivables to replace the
receivables that are repaid. In the event that World Omni is unable to generate
sufficient new receivables, or is unable to transfer the receivables it generates
because of restrictions in its financing arrangements or otherwise, the trust
will be required to hold cash or investment securities rather than receivables.
The yield on cash or investment securities may be lower than the yield on
receivables. Because the trust's assets are the sole source of payments on the
notes, this could result in delays or reductions in payments on your notes. World
Omni does not guarantee that it will continue to generate receivables at
historical rates. The following events could negatively impact World Omni's
ability to generate new receivables:
o A decline in the manufacture and sale of automobiles and light trucks due to an
economic downturn, a labor disruption, competitive pressure, or other factors
o A change in vehicle distribution practices
o A change in dealer inventory management practices
o A change in the interest rates charged by World Omni to dealers
o A change in the amounts of the credit lines or other terms offered by World
Omni to dealers
o Defaults on accounts by dealers
o Termination of dealer franchises
o Dealers becoming insolvent or filing for bankruptcy
o Seasonal fluctuations in the sale and leasing of vehicles
As of September 30, 1999, approximately 30% of the aggregate principal balance of
the receivables held by World Omni were related to vehicles sold to dealers by
Southeast Toyota Distributors. Accordingly, the ability of World Omni to supply
new receivables to the trust will be in part dependent upon the ability of
Southeast Toyota Distributors to sell vehicles.
THE FAILURE OF DEALERS TO MAKE
PAYMENTS ON THE RECEIVABLES COULD
DELAY OR REDUCE PAYMENTS ON THE
NOTES The trust's ability to make payments on the notes generally depends on
collections from dealers on the receivables. The prospectus supplement will
describe past patterns of dealer payments on similar receivables.
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The timing of the sale and lease of vehicles is uncertain. It depends on many
economic and social factors that are beyond the control of World Omni, the
Transferor and the trust. Sales incentive programs and financing incentive
programs of vehicle manufacturers, including Toyota, and distributors, including
Southeast Toyota Distributors, also affect the sale and lease of vehicles. World
Omni does not guarantee that dealers will pay on the receivables at the same rate
as in the past or in any particular pattern. If the dealers' ability to pay on
the receivables declines for whatever reason, you might experience delays or
reductions in payments on your notes.
FAILURE OF WORLD OMNI OR THE
TRANSFEROR TO FULFILL ITS REPURCHASE
OBLIGATIONS MAY ADVERSELY AFFECT THE
TRUST World Omni, the Transferor and their respective affiliates generally are not
obligated to make payments to you on your notes and do not insure or guarantee
the payment of the receivables or your notes. However, World Omni will make
representations and warranties to the Transferor regarding the characteristics of
the receivables. The Transferor will assign these representations and warranties
to the trust, and the Transferor will make its own representations and warranties
to the trust in connection with the transfer of the receivables to the trust. If
World Omni or the Transferor breaches its representations and warranties, and the
breach materially and adversely affects the receivable or the interests of the
noteholders in that receivable, the Transferor will be obligated to repurchase
the receivable from the trust. World Omni would be required to purchase such
receivable from the Transferor. If World Omni fails to repurchase such receivable
from the Transferor, the Transferor may not have adequate funds to repurchase the
affected receivable from the Trust and you may experience delays or reductions in
payments on your notes. See 'The Transfer and Servicing Agreements--Receivables
Purchase Agreement' and '--Representations and Warranties of the Transferor.'
THE TRUST ASSETS ARE LIMITED TO THE
RECEIVABLES AND ANY FORMS OF CREDIT
ENHANCEMENT The notes represent obligations of the trust only. The sole source of payments on
the notes are the assets of the trust. The trust will not have any significant
assets or sources of funds other than the receivables, its limited rights in
accounts, and other rights or credit enhancements as specified in the prospectus
supplement for the series. The notes are not obligations of and are not insured
or guaranteed by World Omni, the Transferor or any other entity or person
(including any affiliate of World Omni or the Transferor).
You must rely primarily on payments on the trust's receivables, funds in the
specified accounts and other credit enhancements, if any, for repayment of your
notes. In addition, you may have to look to the proceeds from the repossession
and sale of the collateral that secures defaulted receivables and the proceeds
from any recourse against dealers under the financing agreements. If these
sources are
</TABLE>
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<TABLE>
<S> <C>
insufficient, you might experience delays or reductions in payments on your
notes.
THE TRUST HAS LIMITED RESTRICTIONS
ON ISSUING ADDITIONAL SERIES OF
NOTES The trust, as a master trust, may issue additional series of notes. The terms of
any additional series of notes will be established at the time of their issuance
and may vary substantially from the terms of your notes. The terms of the
agreements creating a new series of notes may not change the terms of any
existing series of notes, and it is a condition to the issuance of any additional
series of notes that it not result in a decrease in the rating of any existing
series of notes. However, the issuance of additional series of notes could
ultimately result in delays or reductions in payments on your notes.
LIMITED ABILITY TO RESELL NOTES The underwriters for a series of notes may assist in the resale of those notes,
but they are not required to do so. A trading market for the notes may not
develop. If a trading market does develop, it might not continue or it might not
be sufficiently liquid to allow you to resell any of your notes.
</TABLE>
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THE SERVICER
World Omni Financial Corp. ('WORLD OMNI' or the 'SERVICER') is a Florida
corporation and a subsidiary of JM Family Enterprises, Inc. ('JM FAMILY
ENTERPRISES'), a Delaware corporation. World Omni is primarily engaged in
providing automobile dealerships throughout the United States with a full range
of financial services. World Omni provides wholesale floorplan financing,
capital loans and mortgages to dealers and also provides retail motor vehicle
leasing and installment financing to the customers of these dealers and to
others. The principal executive offices of World Omni are located at 120 N.W.
12th Avenue, Deerfield Beach, Florida 33442, and its telephone number is (954)
429-2200.
THE TRANSFEROR
WODFI LLC (the 'TRANSFEROR') is a Delaware limited liability company and a
wholly-owned subsidiary of World Omni. The Transferor was organized in July 1999
for limited purposes, which include:
o purchasing receivables from World Omni;
o financing the receivables purchased;
o transferring the receivables to third parties; and
o any activities incidental to and necessary or convenient for the
accomplishment of those purposes.
The principal executive office of the Transferor is located at 120 N.W. 12th
Avenue, Deerfield Beach, Florida 33442, and its telephone number is (954)
429-2200.
The Transferor has taken steps in structuring the transactions contemplated
by this prospectus that are intended to ensure that a petition for relief by
World Omni under the U.S. Bankruptcy Code or similar applicable state laws
('INSOLVENCY LAWS') will not result in a court disregarding the Transferor as a
separate entity and consolidating its assets and liabilities with those of World
Omni. These steps include the creation of the Transferor as a separate, limited
purpose entity pursuant to its certificate of formation and limited liability
company agreement, which contain limitations, including restrictions on the
nature of the Transferor's business and a restriction on the Transferor's
ability to file a petition for relief under any Insolvency Law without the
unanimous affirmative vote of all of its board directors. The Transferor's
limited liability company agreement also includes a provision requiring the
Transferor to have two directors who qualify as independent as that term is
defined in the Transferor's limited liability company agreement. See 'Risk
Factors--A Bankruptcy of World Omni or the Transferor May Delay or Reduce
Payments on the Notes' and 'Certain Legal Aspects of the Receivables--Certain
Matters Relating to Bankruptcy.'
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<PAGE>
THE TRUST
World Omni Master Owner Trust (the 'TRUST') is a Delaware business trust
formed pursuant to a Trust Agreement (the 'TRUST AGREEMENT'), between the
Transferor and Chase Manhattan Bank Delaware, as Owner Trustee (the 'OWNER
TRUSTEE') dated as of November 22, 1999 (the 'INITIAL CLOSING DATE').
On the Initial Closing Date the Transferor conveyed to the Trust, without
guaranty that the Trust will be able to collect, the non-participated portion of
receivables (the 'RECEIVABLES') arising under selected revolving financing
agreements (the 'ACCOUNTS') entered into with World Omni by retail automotive
dealers franchised by dealers (the 'DEALERS') to finance their inventory of new
and used automobiles and light duty trucks. The property of the Trust consists
of or will consist of:
o the Receivables existing in the Accounts on November 18, 1999 (the
'INITIAL CUT-OFF DATE');
o all Receivables generated in the Accounts after the Initial Cut-Off Date;
o Receivables existing in or generated in any Accounts added to the Trust
on or after the related addition date;
o the participation interest of the Transferor in Purchased Participation
Receivables, to the extent confirmation that the inclusion of such
Purchased Participation Receivables in the Trust will not result in the
reduction or withdrawal of the ratings of any outstanding series of Notes
by the Rating Agencies;
o an assignment of all the Transferor's rights and remedies under the
Receivables Purchase Agreement, dated as of the Initial Closing Date,
between World Omni and the Transferor (the 'RECEIVABLES PURCHASE
AGREEMENT'), pursuant to which the Transferor will purchase Receivables
from World Omni;
o all collections of principal under the Receivables ('PRINCIPAL
COLLECTIONS'); all collections of interest and other nonprincipal charges
(including insurance service fees, amounts recovered on Defaulted
Receivables and insurance proceeds) under the Receivables and rebate
amounts deposited by the Servicer with respect to specified interest
rebate programs into the Collection Account ('NON-PRINCIPAL COLLECTIONS'
and, together with Principal Collections, 'COLLECTIONS');
o all funds on deposit in specified accounts of the Trust;
o any letter of credit, surety bond, cash collateral account, spread
account, guaranteed rate agreement, swap or other interest rate
protection agreement, maturity liquidity facility, tax protection
agreement or other arrangement (each, an 'ENHANCEMENT') issued for a
series or class of notes; and
o a security interest in motor vehicles securing the Receivables (the
'VEHICLES') and specified parts inventory, equipment, fixtures, service
accounts and, in some cases, realty and/or personal guarantees securing
the Receivables (together, the 'COLLATERAL SECURITY').
See 'The Transfer and Servicing Agreements--Receivables Purchase Agreement' for
an overview of the Receivables Purchase Agreement. The noteholders will not have
any interest in any Enhancements provided for the benefit of the noteholders of
another series or class. See 'The Transfer and Servicing
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<PAGE>
Agreements--Removal of Accounts' for information regarding the removal of
Receivables and Accounts from the trust.
The Transferor, the Trust and World Omni as Servicer entered into a trust
sale and servicing agreement, dated as of the Initial Closing Date (the 'TRUST
SALE AND SERVICING AGREEMENT'). Pursuant to the Trust Sale and Servicing
Agreement the Trust acquired the Receivables from the Transferor and the
Servicer agreed to service the Receivables. Under the Trust Sale and Servicing
Agreement, the Transferor is conditionally allowed, and in some circumstances is
obligated:
o to designate new Accounts to be included as Accounts and to convey to the
Trust the Receivables of those new Accounts,
o to acquire certain Purchased Participation Receivables to be conveyed to
the Trust,
o to designate certain Accounts to be removed, and
o to require the Trustee to return receivables in certain removed Accounts
to the Transferor.
See 'The Transfer and Servicing Agreements--Addition of Accounts' for
information regarding the addition of Accounts.
The Trust has issued a series of asset backed notes and may issue one or
more series of notes (collectively, the 'NOTES'). The Trust has also issued
certificates (the 'CERTIFICATES'). The Certificates are not being offered for
sale by this prospectus and are currently held by the Transferor.
The prospectus supplement will describe the capitalization and liabilities
of the Trust at the time of the issuance of the series of Notes offered by that
prospectus supplement.
Prior to its formation, the Trust had no assets or obligations. The Trust
has not and will not engage in any business activity other than:
o acquiring and holding the Receivables, the other assets of the Trust and
proceeds therefrom;
o issuing the Notes and the Certificates; and
o making payments on the above and related activities.
As a consequence, the Trust is not expected to have any need for, or source
of, capital resources other than the assets of the Trust.
THE OWNER TRUSTEE
Chase Manhattan Bank Delaware, a Delaware banking corporation, serves as
Owner Trustee under the Trust Agreement. The principal executive offices of the
Owner Trustee are located at 1201 North Market Street, 8th Floor, Wilmington,
Delaware 19801, and its telephone number is (302) 428-3300.
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<PAGE>
USE OF PROCEEDS
As provided in the prospectus supplement, the Trust will use the net
proceeds from the sale of a series of the notes to repay the outstanding
principal amount of other series of Notes then outstanding, to make deposits
into the Excess Funding Account to the extent required, to make distributions to
the Certificateholders and for the other purposes specified in the related
prospectus supplement.
THE DEALER FLOORPLAN FINANCING BUSINESS
The Receivables to be conveyed to the Trust by the Transferor result from
loans made by World Omni to Dealers under floorplan financing agreements to
finance the Dealers' purchases of new and used Vehicles. Used Vehicles may be
purchased by Dealers at auctions, from other dealers, from finance companies
such as World Omni or directly from vehicle owners.
The vast majority of floorplan financing agreements are structured so that
World Omni lends an amount on the acquisition by the Dealer of a specific
Vehicle and the Dealer is required to repay the loan upon the sale of such
Vehicle. In certain limited circumstances, floorplan financing agreements are
structured so that World Omni lends an aggregate amount based on the value of
all of the Vehicles securing the Receivables. In these asset based floorplan
financing arrangements, the Receivables created are referred to as 'ASSET BASED
RECEIVABLES', and, so long as the aggregate value of Vehicles securing the
Receivables exceeds specified levels, the Dealer is not required to repay the
loan upon the sale of a specific Vehicle. Except as noted below, World Omni
originates, underwrites, services, and monitors Asset Based Receivables in the
same manner that it does for its other Receivables.
World Omni is the major wholesale financing source for Dealers in Southeast
Toyota Distributors' distribution network. As of September 30, 1999, World Omni
provided floorplan financing to approximately 47% of those Dealers. World Omni
services all of the Dealers from its main office located in Deerfield Beach,
Florida.
CREATION OF RECEIVABLES
World Omni generally finances 100% of the invoice price of new Vehicles. A
Receivable is created upon shipment of the new vehicle from the vehicle
manufacturer or distributor to the Dealer. The amount that World Omni will lend
on a used vehicle varies as follows:
o For vehicles purchased by the dealer at an auction and financed by World
Omni via payment directly to the auction, World Omni typically finances
100% of the auction price plus the buyer's fees paid to the auction.
o In some circumstances, the vehicle being financed by World Omni is one
that was sold by World Omni to the dealer. Most of these vehicles were
leased by World Omni to a consumer and were returned to World Omni at the
end of the lease. If the used vehicle being financed under World Omni's
floorplan is one that was sold by World Omni to the dealer, World Omni
will lend 100% of the price the dealer paid to World Omni for the
vehicle.
o For select dealers, World Omni will lend 100% of the 'Black Book' value
of the used vehicle. In some circumstances the Black Book value includes
the value of additional equipment on the vehicle.
o In situations other than those described above, World Omni will finance
up to 80% of the wholesale value of the vehicle as defined in the NADA
Official Used Car Guide's 'Average Trade In' column.
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<PAGE>
In asset based floorplan financing programs, World Omni generally permits
the Dealer to draw an amount up to the aggregate of 100% of the invoice price of
all new Vehicles securing the Receivables and a portion of the value of all used
Vehicles securing the Receivables. The value of used Vehicles is typically
limited to the wholesale value of the Vehicle as defined in the NADA Official
Used Car Guide's 'Average Trade In' column.
Used Vehicles represented approximately 14.6% and 16.2% of the total dollar
amount of Receivables outstanding as September 30, 1999, and December 31, 1998,
respectively.
CREDIT APPROVAL AND CREDIT GUIDELINES
World Omni's floorplan programs are administered by its Commercial
Operations Department located in Deerfield Beach.
World Omni provides floorplan financing to Dealers pursuant to
pre-established credit guidelines. World Omni must approve each prospective
Dealer before that Dealer signs a dealer financing agreement. Each dealer
financing agreement generally includes a security agreement, a personal guaranty
by the principal owner of the Dealer and, when necessary, an intercreditor
agreement. The collateral subject to the security agreement always includes the
Vehicles and may include:
o inventory, equipment and other property of the Dealer, including parts
inventory, furniture, fixtures and tools;
o additions, accessories and accessions;
o intangibles, instruments, chattel paper and accounts arising out of the
sale or lease of the foregoing;
o substitutions, returned and repossessed items; and
o proceeds thereof, including insurance proceeds.
Prior to providing floorplan financing to a Dealer, the Commercial
Operations Department performs an analytical and investigative review to
evaluate the character and credit of the principal owners of a prospective
Dealer and to determine whether the Dealer's capital structure is adequate to
support the business. In conducting its review, representatives of the
Commercial Operations Department will conduct interviews with Dealer principals,
check credit references, obtain dealership and personal financial statements and
review the business history of dealership management and existing business
plans.
The key process in approving a floorplan financing request is the
completion of a financial statement review of the prospective borrower. In some
cases, this review will be based on pro forma statements and projections
completed by the prospective Dealer. In its review, World Omni focuses mainly on
the financial strength, integrity and past history of the Dealership's
operations and its guarantors. In addition, World Omni analyzes the Dealer's
location, paying particular attention to the market area and the Dealer's
potential to sell Vehicles. When available, World Omni uses state vehicle
registration data to evaluate a Dealer's primary market area and to help
determine the retail penetration ability of a new Dealer. In addition, Dealers
who sell Toyotas generally sign a release letter which enables World Omni to
access Southeast Toyota Distributor's files on those Dealers. World Omni derives
a wide array of financial information and trend analysis from Southeast Toyota
Distributor's files.
When a Dealer requests a floorplan financing program, World Omni conducts a
search of the appropriate records of the filing office or offices to determine
if there are other creditors of the Dealer with current security interest
filings. Prior filings are given particular attention by World Omni
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<PAGE>
management, especially if they relate to Vehicles or if the wording is broad
enough to indicate a possible conflict with World Omni's security interest. In
those instances, World Omni works with the particular Dealer to eliminate any
conflicts. Steps taken include executing an intercreditor agreement with any
other creditor and/or arranging for the filing of amendments to any prior
financing statements. World Omni may approve the Dealer's request for a
floorplan financing program but will not advance any funds to the Dealer until
all conflicts are resolved.
If a prospective Dealer is approved by World Omni, the Dealer and World
Omni enter into a dealer financing agreement. The principal owner of the
dealership is generally required to guarantee the Dealer's obligations to World
Omni and to subordinate its loans to the dealership to the Dealer's indebtedness
to World Omni.
Pursuant to the dealer financing agreement, in order to secure all
indebtedness of the Dealer to World Omni, the Dealer grants to World Omni a
first priority security interest in its inventory of Vehicles and, in many
cases, to other assets, such as parts and equipment.
World Omni is, in most cases, the exclusive source of Vehicle financing for
a Dealer. When a Dealer has an additional source of Vehicle financing, the other
financier generally takes a security interest in collateral which overlaps with
World Omni's. In these situations, World Omni will not advance funds until it
has entered into an intercreditor agreement with the other financier in which
each of World Omni and the other financier subordinates its lien on any Vehicle
financed by the other party, and the proceeds thereof, to the lien of the
financing party.
Each Dealer is required by its dealer financing agreement to obtain
physical damage insurance covering all Vehicles, with the Servicer being named
as an additional loss payee. World Omni arranges this insurance for some Dealers
through a master policy issued by St. Paul Fire and Marine Insurance Company,
which is currently rated A+15 by A.M. Best Company, Inc., a nationally
recognized insurance rating agency. An affiliate of World Omni handles claims
adjustments under these policies. As to Dealers who elect to make other coverage
arrangements, World Omni's affiliate maintains a follow-up system, which
includes:
o coverage verification;
o tracking of policy expiration dates;
o renewal follow-up; and
o verification that World Omni is properly identified as a loss payee.
As a matter of practice, World Omni does not, however, require that payments
from the insurer under these policies be paid to it so long as a Dealer is not
'out of trust'; that is, so long as the Dealer does not sell a Vehicle and use
the sale proceeds thereof for its own separate purposes.
During the initial 120-day period after the signing of a dealer financing
agreement, World Omni generally conducts monthly floorplan audits, verifying the
purchase and sale of all Vehicles. At the end of 180 days, World Omni completes
a 'FINANCIAL STATEMENT REVIEW' and updates the Dealer's initial risk
classification. Dealer credit ratings range from one to six, with one being the
most financially sound. This risk classification determines the floorplan audit
and credit review frequency and is important in setting the Dealer's credit
limit.
o 'CLASS I DEALERS' are Dealers that are determined to be low risk due to
their excellent financial condition and performance.
o 'CLASS II DEALERS' are Dealers that are determined to be of acceptable
risk due to their good financial condition and performance.
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o 'CLASS III DEALERS' are Dealers that are determined to have fair
financial condition and performance with some negative trend.
o 'CLASS IV DEALERS' are Dealers that are determined to have weak financial
condition and performance with negative tend. Dealers for which a check has been
returned within the previous twelve months for reason of insufficient funds will
not be rated stronger than Class IV.
o 'CLASS V DEALERS' are Dealers that are determined to be high-risk. Class
V Dealers generally include those Dealers with poor audit histories and
inadequate or negative working capital, net worth and profits.
o 'CLASS VI DEALERS' are Dealers that have sold Vehicles 'out of trust'.
The following tables provides (1) the number of Accounts in each Class, (2)
the number of Accounts in each Class as a percentage of the total number of
Accounts in the Wholesale Portfolio, and (3) the principal balance of
Receivables in each Class as a percent of the total principal balance of
Receivables in the Wholesale Portfolio, each as of September 30, 1999.
<TABLE>
<CAPTION>
PERCENTAGE OF PERCENTAGE OF
NUMBER OF ACCOUNTS ACCOUNTS PRINCIPAL BALANCE
------------------ ------------- -----------------
<S> <C> <C> <C>
Class I Dealers........................................ 119 50% 55%
Class II Dealers....................................... 63 26% 24%
Class III Dealers...................................... 22 9% 9%
Class IV Dealers....................................... 21 9% 7%
Class V Dealers........................................ 8 3% 4%
Class VI Dealers....................................... 6 3% 1%
</TABLE>
World Omni establishes a base inventory guideline to provide floorplan
financing adequate for Dealers' normal vehicle sales. Typically, Dealers are
granted credit lines based on a 60-day sales rate for new vehicles and a 45-day
sales rate for used vehicles. These credit lines are monitored on a daily basis
and adjustments are made upon appropriate credit approval or disapproval.
If World Omni determines that a specific Dealer's inventory is excessive,
the Dealer may be placed on finance hold status. In addition, a Dealer may be
placed on finance hold if the dealer financing agreement is violated, a check is
returned unpaid or a Dealer requests controlled Vehicle releases. In these
circumstances, World Omni assumes control of Vehicle releases to the Dealer and
specifically approves the releases on a unit-by-unit basis. Dealers are also
placed on finance hold status if World Omni determines that the Dealer has sold
'out of trust.' Finance hold status on a particular Dealer will remain until
World Omni determines that the circumstances have been remedied.
PAYMENT TERMS
Receivables related to non-asset based floorplan financing of new Vehicles
are due on demand, but generally must be paid upon the earlier of (a) one to ten
days (averaging four days) following the sale or other disposition of the
Vehicle, (b) within one business day of the dealer being funded by the buyer of
the vehicle or by the buyer's financing source and (c) a fixed period after the
Vehicle's initial acquisition by the Dealer. Although dealer financing
agreements may vary as to the precise measurement of the fixed period, generally
the principal balance of the Receivable must be paid down 10% per month
beginning April 1 of the year following the model year of the underlying
Vehicle, and must be paid in full by the next October, unless the Vehicle is
recategorized as a used Vehicle. In very limited cases, World Omni offers a
delayed payment privilege program to select Dealers to finance fleet sales.
Under this program, Receivables must generally be paid in full on the earlier of
(1) the 20th day after delivery to the end user or (2) receipt of payment from
the end user.
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Receivables relating to non-asset based floorplan financing of used
Vehicles are generally stated to be due on demand or on the earlier of (1) one
to ten days (averaging four days) following the sale of the Vehicle, (2) within
one business day of the Dealer being funded by the buyer or the buyer's funding
source or (3) 90 days after the Vehicle is first financed by World Omni. World
Omni, in its sole discretion, may generally grant one extension for a period of
30 days if a principal payment of 10% of the unpaid principal balance is made by
the Dealer prior to the extension.
Receivables related to asset based floorplan financings are due on demand.
In addition, the Dealer must pay all or a portion of these Receivables to the
extent that the outstanding balance exceeds a specified percentage of the value
of the Vehicles securing the Receivables.
World Omni currently charges interest monthly on Receivables based on the
prime rate or the London interbank offered rate ('LIBOR'). As of September 30,
1999, Receivables secured by new Vehicles based on the prime rate and LIBOR were
accruing interest at an, annual rate averaging the prime rate + 0.15% and LIBOR
+ 2.04%, respectively. Receivables secured by used Vehicles based on the prime
rate and LIBOR were accruing interest at an annual rate averaging the prime rate
+ 0.62% and LIBOR + 2.05%,respectively. Upon agreement with the Dealers, World
Omni may change the rate mechanism, the rate to which the Receivables are tied
or the interest rate premium in any manner.
Some Dealers maintain funds with World Omni under an inventory cash escrow
agreement ('FLOOR PLAN EQUITY PROGRAM'), pursuant to which funds are held for
cash management, liquidity and working capital purposes. The Dealers can
withdraw these funds so long as the Dealer has not defaulted under its floorplan
agreements with World Omni. Generally, interest on the prepaid funds is offset
against interest due from the Dealer on the Receivables. For purposes of the
Trust, funds deposited by Dealers with World Omni will be treated by World Omni
as Principal Collections of Receivables, and withdrawals by Dealers will be
treated by World Omni as creating new Receivables.
BILLING AND COLLECTION PROCEDURES
A statement setting forth interest and other billing and account
information is prepared by World Omni and distributed on a monthly basis to each
Dealer. Each Dealer's bills are generated on approximately the first or second
business day of the month, and payments are due on the tenth day of the month in
which they are billed. Interest is billed retroactively and Dealers make
payments by check or electronic funds transfer. Dealers are required to make
principal payments on Receivables when due by check or electronic funds
transfer.
DEALER MONITORING
World Omni produces a daily accounting of the balance outstanding under
each credit line. All exposures above established credit lines require approval
by World Omni's Commercial Operations Department on a monthly basis. A monthly
status report is provided to World Omni senior management. This report is an
all-inclusive summary of the monthly and ongoing developments relating to Dealer
credits. A review of all existing credit lines (the 'FINANCIAL STATEMENT
REVIEW') is completed at least once a year and is not limited to financial
statement and ratio analysis, but is designed to provide an overview of the
entire operation as it relates to World Omni. A security interest search is
conducted on an annual basis in conjunction with the formal review of the Dealer
to ensure that there are no conflicts with World Omni's security interests.
The Commercial Operations Department follows a procedure (the 'BOOK
REVIEW') to verify the validity of new Dealer financial statements. It is World
Omni's intention to complete a Book Review with most new Dealers. The process
mirrors the Financial Statement Review, but includes an actual review and
verification of the Dealer's records. Upon completion, the results are discussed
with the
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Dealer principals and guarantors. Any deficiencies are addressed and action
plans implemented with a timetable for resolution.
Wholesale floorplan audits are generally completed at least once per
quarter at all Dealers and in most cases monthly, based on the Dealer risk
profile and the prior audit experience of the Dealer. The audit includes a
physical verification of every floorplanned Vehicle. If a Vehicle cannot be
located, the Dealer must provide an explanation that is satisfactory to World
Omni's management and must provide the related manufacturer's statement of
origin or title.
World Omni's daily reporting of Dealer exposures and Dealer payments is
intended to provide the Commercial Operations Department with early warning
signs of potential problems. If the results of the Dealer monitoring process
show that a particular Dealer is suffering financial difficulties, World Omni's
Commercial Operations Department will closely monitor the Dealer while working
with the Dealer to improve its financial condition. Floorplan audit frequency
may be increased and a Book Review may be performed with the results being
discussed with the Dealer and principals or guarantors. Operating trends are
generally reviewed, including the Dealer's cash and net working capital
position. Finally, a meeting may be held between World Omni and the Dealer
resulting in the implementation of a plan of action and a corresponding
timetable in which the plan is to be completed.
These risk management procedures could also be activated in the event a
routine audit reveals a shortage in a Dealer's Vehicle inventory, a Dealer check
is returned for which there are insufficient funds or a Dealer specifically
requests assistance. Dealers who demonstrate these or other problems may be
placed on finance hold, which would result in approval on a per unit basis or
cash-on-delivery terms. World Omni also works to protect the dealership by
providing auditing advice, cash flow management and credit relationship
assistance in order to maintain the value of the dealership as an ongoing
entity. However, further deterioration may result in the seizure and liquidation
of Vehicle inventory. The Wholesale Portfolio, and those Receivables arising
from the Portfolio which are transferred to the Trust, may sometimes include
Receivables arising in Accounts with Dealers which were previously placed by
World Omni on finance hold or which were otherwise non-performing for a period
of time.
If World Omni's review reveals that a Dealer has diverted proceeds from
Vehicle sales due to World Omni to other uses, the Commercial Operations
Department suspends the Dealer's credit lines and sends a demand for payment of
the delinquent obligation. The Dealer's manufacturers will be informed by World
Omni of the change in status. Cash-on-delivery terms may be approved depending
on the severity of the situation. At this point a demand may also be made on the
guarantor(s).
If after exhausting all possible options, the Dealer is unable to pay
amounts owed to World Omni, World Omni may terminate the dealer financing
agreement in accordance with its terms and applicable state law. Generally, in
these circumstances the Dealer's new Vehicle inventory will be resold to the
manufacturer, which generally pays the repurchase price to World Omni for credit
against the aggregate amount of outstanding Receivables owed by the Dealer to
World Omni. If the Dealer resists termination, World Omni will declare the
Dealer in default of its obligations, demand payment in full of its Dealer Note
and all Receivables created thereunder and foreclose on its collateral by taking
possession of the Dealer's Vehicle inventory, and any other Collateral Security.
If necessary, World Omni may also obtain a court order requiring foreclosure.
Used Vehicles are auctioned off to the highest bidder. All proceeds are applied
against the relevant Dealer liabilities. World Omni will generally pursue any
uncollected amounts from the Dealer's guarantors. Once World Omni has commenced
liquidation, it writes off any amounts it determines are uncollectible. During
the course of a liquidation, World Omni may recognize additional losses or
recoveries.
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INTERCREDITOR AGREEMENT FOR SECURITY INTERESTS IN VEHICLES AND NON-VEHICLE
COLLATERAL SECURITY
As stated above, the agreements constituting the financing arrangements,
including the Accounts, provide for a security interest in the Vehicles in favor
of World Omni, which security interest World Omni represents is a first priority
security interest. The security interests in the Vehicles in favor of World Omni
have been assigned by World Omni to the Transferor pursuant to the Receivables
Purchase Agreement and then by the Transferor to the Trust pursuant to the Trust
Sale and Servicing Agreement. In its other lending activities, World Omni may
have made capital loans, real estate loans or other advances to Dealers that are
also secured by a security interest in the Vehicles. In these instances, World
Omni has agreed in the Receivables Purchase Agreement not to exercise its
security interest in any Vehicle until the Trust shall have been paid in full in
respect of the Receivables secured by the Trust's security interest in that
Vehicle. In addition, in connection with other loans or advances made by World
Omni to a Dealer, World Omni may also have a security interest in Collateral
Security other than a Vehicle ('NON-VEHICLE COLLATERAL SECURITY'), such as
personal guarantees, if any, securing the amounts owed by the Dealer. In these
cases, World Omni, in its sole discretion, may realize on the Non-Vehicle
Collateral Security for its own benefit in respect of its loans or advances
before the Trust is permitted to realize upon the Non-Vehicle Collateral
Security. Because of the subordinate position of the Trust in respect of
Non-Vehicle Collateral Security, there is no assurance that the Trust will
realize any proceeds in respect of any Non-Vehicle Collateral Security.
PARTICIPATION AGREEMENTS
From time to time, World Omni may enable other financing sources to
participate in certain of its financing arrangements ('PARTICIPATIONS').
Pursuant to a typical Participation, the documentation for the underlying loan
will remain in the name of World Omni as Lender. In the financing agreement or
in a separate contractual arrangement with World Omni, the participant will
agree to provide a portion of the funding of such loan in exchange for an agreed
upon interest rate. Occasionally fees and other charges may also be shared with
the participant. The Receivables to be sold by World Omni to the Transferor and
in turn by the Transferor to the Trust, may include the non-participated portion
of receivables from accounts which have been participated. In addition, subject
to substantially the same limitations that apply to the removal of Accounts, the
Transferor may cause the Trust to transfer an interest in certain Receivables to
the Transferor, which may thereafter transfer such interest to another party in
the form of a Participation.
PARTICIPATION INTERESTS PURCHASED BY WORLD OMNI
In certain circumstances, World Omni may participate in financing
arrangements of a third party ('PURCHASED PARTICIPATION RECEIVABLES'). As a
result, the receivables were originated and, in some cases, will be serviced by
such third party. The Receivables sold by World Omni to the Transferor and in
turn by the Transferor to the Trust may include its participation interest in
the Purchased Participation Receivables if the Rating Agencies have confirmed in
writing that such inclusion will not result in the reduction or withdrawal of
the rating of any of the Notes.
RELATIONSHIP WITH AFFILIATES
In July 1995, World Omni and its insurance and warranty affiliates
instituted a program (the 'SUPERWRAP PROGRAM') to encourage Dealers in the
Southeast Toyota Distributors network who finance floorplan vehicles with World
Omni to purchase other financial products sold by World Omni and its insurance
and warranty affiliates, and to remain competitive with other automotive finance
companies. Under the SuperWRAP Program, World Omni and its affiliates pay
participating Dealers specified amounts based on a pricing grid and, in most
cases, these payments are assigned by the
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Dealers to World Omni and applied automatically by World Omni to reduce interest
payments on the Receivables. The Dealers remain obligated to pay the full
interest payments on the Receivable in the event World Omni or its affiliates
fail to make the SuperWRAP Program payments to the Dealers. All Dealers in the
Southeast Toyota Distributors network who have floorplan accounts with World
Omni are eligible to participate under the SuperWRAP Program. In the future,
World Omni may offer a similar program to Dealers that are not in the Southeast
Toyota Distributors network. Approximately $941,028, $1,887,944, $2,342,698, and
$882,136 in payments were made by World Omni and its affiliates to Dealers under
the SuperWRAP Program for the nine months ended September 30, 1999, and the
years ended December 31, 1998, 1997, and 1996, respectively.
THE ACCOUNTS
The Receivables arise in the Accounts. The Accounts have been selected from
all the accounts in World Omni's portfolio that were Eligible Accounts at the
time of selection (the 'WHOLESALE PORTFOLIO'). Commercial finance receivables
similar to the current Accounts which meet the criteria set forth in the Trust
Sale and Servicing Agreement may be added to the Trust in the future. In order
to be included in the Trust, each Account must be an account established or
acquired by World Omni in the ordinary course of business and meet the other
criteria provided in the Trust Sale and Servicing Agreement. See 'The Transfer
and Servicing Agreements--Representations and Warranties by Transferor.' World
Omni may at anytime and without notice or consent of any third party modify the
rates being charged Dealers under the floorplan financing agreements or asset
based financing agreements.
Under the Trust Sale and Servicing Agreement, the Transferor has the right
and, in some circumstances, is obligated, subject to the limitations and
conditions, if any, in its other financing arrangements and agreements to
designate additional qualifying Accounts to be included as Accounts. It may also
sell to the Transferor, in the case of World Omni, and convey to the Trust, in
the case of the Transferor, the Receivables of the Additional Accounts,
including Receivables created from the Additional Accounts. These accounts must
meet the eligibility criteria set forth above as of the date the accounts are
designated as Additional Accounts. World Omni will generally sell to the
Transferor the Receivables then existing or thereafter created under the
Additional Accounts, and the Transferor will in turn convey them to the Trust.
See 'The Transfer and Servicing Agreements--Addition of Accounts.' In addition,
as of any Additional Cut-Off Date in respect of Additional Accounts and the date
any new Receivables are generated unless such Receivable arose in an Additional
Account prior to the applicable Addition Date, World Omni will represent and
warrant to the Transferor, and the Transferor will represent and warrant to the
Trust, that the Receivables meet the eligibility requirements set forth in the
Trust Sale and Servicing Agreement. See 'The Transfer and Servicing
Agreements--Conveyance of Receivables and Related Security.' Under the
circumstances specified in the Trust Sale and Servicing Agreement, the
Transferor has the right to remove Eligible Accounts, and the Receivables
arising from such Eligible Accounts, from the Trust and is required to remove
Ineligible Accounts, and Receivables arising from such Ineligible Accounts, from
the Trust. Interest collections received after an Account has been designated
for removal will be allocated to the Trust or the Transferor, as applicable,
until the principal balance on the date the Account was so designated has been
reduced to zero. See 'The Transfer and Servicing Agreements--Removal of
Accounts.' Throughout the term of the Trust, the Accounts from which the
Receivables arise will be the same Accounts transferred by the Transferor on the
Closing Date plus any Additional Accounts, minus any Accounts removed from the
Trust.
Information regarding the Accounts will be set forth in the prospectus
supplement.
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THE NOTES
GENERAL
The Notes may be issued in one or more series, each series with one or more
classes. Each series of Notes will be issued pursuant to the terms of the
Indenture (the 'INDENTURE') and a Series Supplement to the Indenture for that
series (each, a 'SERIES SUPPLEMENT'), each between the Trust and Harris Trust
and Savings Bank, as Indenture Trustee. Forms of the Indenture and the Series
Supplement have been filed as exhibits to the registration statement of which
this prospectus forms a part. The Transferor will provide a copy of the
Indenture and relevant Series Supplement (each without exhibits) upon request of
a Noteholder. The following summary does not purport to be complete and is
subject to, and is qualified in its entirety by reference to, all of the
provisions of the Notes, the Indenture and the applicable Series Supplement.
Where particular provisions or terms used in the Indenture or a Series
Supplement are referred to, the actual provisions, including definition of
terms, are incorporated by reference as part of this summary.
The Notes of each series will evidence fixed obligations of the Trust. The
Notes will be secured by the assets of the Trust allocated to that series and
will represent the right to receive Collections and other amounts from those
assets allocated to that series up to the amounts required to make payments of
interest on and principal of the Notes of that series as described in the
related prospectus supplement. Principal and interest on the Notes will
generally be paid on the 15th day of the month (each, a 'PAYMENT DATE') as set
forth in the related prospectus supplement.
Each series of Notes will initially be represented by one or more Notes
registered in the name of the nominee of DTC (together with any successor
depository selected by the Trust, the 'DEPOSITORY') in the United States, or
Clearstream Banking or Euroclear in Europe, except as set forth below. Notes
will be available for purchase in denominations of $1,000 and integral multiples
thereof in book-entry form only. The Transferor has been informed by DTC that
DTC's nominee will be Cede & Co. Accordingly, Cede & Co. is expected to be the
holder of record (the 'NOTEHOLDER') of the Notes.
Unless and until Definitive Notes are issued under the limited
circumstances described in this prospectus or in the related prospectus
supplement, no Noteholder will be entitled to receive a physical certificate
representing a Note. All references herein to actions by Noteholders refer to
actions taken by DTC upon instructions from its participants. All references
herein to distributions, notices, reports and statements to Noteholders refer to
distributions, notices, reports and statements to DTC or Cede & Co., as the
registered holder of the Notes, as the case may be, for distribution to
Noteholders in accordance with DTC's procedures. See '--Book-Entry Registration'
and '--Definitive Notes.'
INTEREST
Interest on the principal balance of the Notes of a series or class will
accrue at the rate specified in or determined in the manner specified in the
related prospectus supplement. Interest will be payable to the Noteholders of a
series or class as and on the dates specified in the related prospectus
supplement ('INTEREST PAYMENT DATES'). The prospectus supplement for a series or
class of Notes may provide that the interest rate and the Interest Payment Dates
applicable to each Note of that series or class may be subject to adjustment
from time to time, including as a result of a decline in the interest rate of
the Receivables.
Non-Principal Collections and other amounts allocable to the Notes of a
series of Notes generally will be used to make interest payments to Noteholders
of that series on each Interest Payment Date. If Interest Payment Dates occur
less frequently than monthly, (1) the Non-Principal Collections or other amounts
allocable to that class will be deposited in a trust account (an 'INTEREST
FUNDING ACCOUNT')
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and will be used to make interest payments to Noteholders of that series or
class on the next Interest Payment Date and (2) during an Early Amortization
Period, interest will be distributed to the Noteholders monthly on each Payment
Date (each a 'SPECIAL PAYMENT DATE'). If a series has more than one class of
Notes, each class may have a separate Interest Funding Account.
PRINCIPAL
The timing and priority of payment, seniority and amount of or method of
determining payments of principal on each class of Notes will be described in
the related prospectus supplement. Generally, the Notes of each series will have
a revolving period during which no principal payments are required to be made on
the Notes (the 'REVOLVING PERIOD'). The Revolving Period for a series or class
will begin on the date specified in the related prospectus supplement and end on
the earlier of (a) the close of business of the day immediately preceding the
Accumulation Period Commencement Date or the Principal Commencement Date for
that series and (b) the close of business of the business day immediately
preceding the day on which an Early Amortization Event or an Investment Event
occurs for that series. See '--Investment Events and Early Amortization Events'
for a discussion of the events that might lead to the early termination of the
Revolving Period and the recommencement of the Revolving Period. If a series of
Notes has more than one class, each class may have a different Revolving Period.
During the Revolving Period, Excess Principal Collections will not be paid
to the Noteholders, but rather will be paid to the Certificateholders or
deposited to the Excess Funding Account and may be used to repay the principal
amount of another class or series of Notes.
If the principal of the Notes of a series or class is scheduled to be paid
in full on a date specified in the related prospectus supplement (the 'EXPECTED
PRINCIPAL PAYMENT DATE'), the Notes will have an accumulation period (the
'ACCUMULATION PERIOD'). The Accumulation Period will begin at the close of
business on the date specified in or determined in the manner specified in the
related prospectus supplement (the 'ACCUMULATION PERIOD COMMENCEMENT DATE') and
will end on the earliest of (a) the commencement of an Investment Period or an
Early Amortization Period for that series and (b) payment in full of the
outstanding principal amount of the Notes of that series.
During an Accumulation Period, Principal Collections and other specified
amounts allocable to the Noteholders of a series will be deposited into a trust
account established for the benefit of the Noteholders of that series (a
'PRINCIPAL FUNDING ACCOUNT') and used to make principal distributions to the
Noteholders of that series when due. The amount to be deposited in the Principal
Funding Account for any series of Notes with respect to any Payment Date may be
limited to an amount (the 'CONTROLLED DEPOSIT AMOUNT') specified in the related
prospectus supplement. If a series has more than one class of Notes, each class
may have a different Accumulation Period and a separate Principal Funding
Account and Controlled Deposit Amount, and the related prospectus supplement
will describe any priorities among the classes of a series for deposits of
principal into the Principal Funding Accounts. In the event that the breach of
any representation made by the Transferor has a materially adverse effect on the
Noteholders of a series and such Noteholders have exercised their right to have
the Notes of such series redeemed, the Transferor shall deposit the redemption
price into the Principal Funding Account for such series.
If the principal of the Notes of a series is scheduled to be paid in
installments commencing on a date specified in the related prospectus supplement
(the 'PRINCIPAL COMMENCEMENT DATE'), the Notes will have an amortization period
(the 'AMORTIZATION PERIOD'). The Amortization Period will begin at the close of
business on the date specified in the related prospectus supplement and will end
on the earliest of (a) the commencement of an Investment Period or an Early
Amortization Period for that series and (b) payment in full of the outstanding
principal amount of the Notes of that series.
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During an Amortization Period, Principal Collections and other specified
amounts allocable to the Notes of a series will be used on each Payment Date to
make principal distributions to any class of Noteholders of that series then
scheduled to receive distributions. The amount to be distributed to Noteholders
of any series of Notes on any Payment Date may be limited to an amount (the
'CONTROLLED AMORTIZATION AMOUNT') for that series specified in the related
prospectus supplement. If a series has more than one class of Notes, each class
may have a different Amortization Period and a separate Controlled Amortization
Amount, and the related prospectus supplement will describe any priorities among
the classes of a series for distributions.
The payment of principal of the Notes of a series or class may commence
earlier than the applicable Expected Principal Payment Date or Principal
Commencement Date, and the final principal payment for the Notes of a series or
class may be made earlier or later than the applicable Expected Principal
Payment Date or other expected date if an Early Amortization Event occurs for
that series or class or under the circumstances described in this prospectus or
in the related prospectus supplement.
If the related prospectus supplement so specifies, the Notes of a series
may have an investment period (the 'INVESTMENT PERIOD'). The Investment Period
for a series of Notes will begin on the day (the 'INVESTMENT PERIOD COMMENCEMENT
DATE') on which an investment event for that series has occurred (an 'INVESTMENT
EVENT') and will end on the earliest of (a) the commencement of an Early
Amortization Period for that series, (b) the recommencement of the Revolving
Period for that series, and (c) payment of the outstanding principal amount of
the Notes of that series in full. The Investment Events for a series will be set
forth in the related prospectus supplement and Series Supplement.
During an Investment Period, Principal Collections and other specified
amounts allocable to the Notes of a series will be deposited on or before each
Payment Date in a Principal Funding Account and used to make principal
distributions to the Noteholders of that series when due. The amount to be
deposited in a Principal Funding Account for any series of Notes on any Payment
Date will not be limited to any Controlled Deposit Amount or Controlled
Amortization Amount. If a series has more than one class of Notes, each class
may have a separate Principal Funding Account, and the related prospectus
supplement will describe any priorities among the classes of a series for
deposits of principal into the Principal Funding Accounts.
After the date on which the amount on deposit in the Principal Funding
Account for a series of Notes equals the outstanding principal amount of the
Notes of that series (the 'FULLY FUNDED DATE'), Noteholders of that series will
no longer have any interest in the Receivables and all the representations and
covenants of the Transferor and the Servicer relating to the Receivables, as
well as other specified provisions of the Indenture, and all remedies for
breaches of those representations and warranties will no longer accrue to the
benefit of the Noteholders of that series, in each case unless the Revolving
Period for that series recommences. In addition, upon the occurrence of the
Fully Funded Date for a series, no Non-Principal Collections, Principal
Collections, Defaulted Receivables or Miscellaneous Payments will be allocated
to that series unless the Revolving Period for that series recommences. See
'--Termination; Fully Funded Date.'
During the period (the 'EARLY AMORTIZATION PERIOD') beginning on the day on
which an Early Amortization Event has occurred for a series of Notes and ending
on the earliest of (1) the payment in full of the outstanding principal balance
of the Notes of that series, (2) the recommencement of the Revolving Period for
that series and (3) the Termination Date for that series, the Revolving Period,
the Investment Period, the Controlled Amortization Period or the Accumulation
Period, as the case may be, for that series will terminate. See '--Investment
Events and Early Amortization Events' for a description of events that might
result in the commencement of an Early Amortization Period for a series of
Noteholders.
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During the Early Amortization Period for a series of Notes, Principal
Collections and other specified amounts allocable to the a series will be
distributed as principal payments to the applicable Noteholders monthly on each
Payment Date beginning with the first Special Payment Date. During the Early
Amortization Period for a series of Notes, distributions of principal to
Noteholders of that series will not be limited to any Controlled Deposit Amount
or Controlled Amortization Amount. In addition, to the extent provided in the
related Series Supplement, such series' share of funds on deposit in the Excess
Funding Account and any funds on deposit in the Principal Funding Account for
that series will be paid to the Noteholders of the relevant class or series.
Funds on deposit in any Principal Funding Account established for a class
or series of Notes will be invested in Eligible Investments and may be subject
to a guarantee or other mechanism specified in the related prospectus supplement
intended to assure a minimum rate of return on the investment of those funds. In
order to enhance the likelihood of the payment in full of the principal amount
of a series or class of Notes at the end of the related Accumulation Period,
that series or class may be subject to a maturity liquidity facility or other
similar mechanism specified in the related prospectus supplement. A maturity
liquidity facility is a financial contract that generally provides that
sufficient principal will be available to retire the Notes at a specified date.
Notes of a series or class may also be subject to purchase generally at
their respective principal amounts in connection with a remarketing thereof if
so specified in the related prospectus supplement. A purchase of Notes of a
series or class may result in a decrease in the outstanding principal amount of
the series or class prior to the commencement of any related Controlled
Amortization Period or Early Amortization Period. The prospectus supplement for
any series of Notes subject to purchase will describe the conditions to and
procedures for any purchase. The proceeds of any purchase would be paid to the
holders of the Notes purchased.
THE INDENTURE AND THE SERIES SUPPLEMENTS
The Indenture contains provisions that generally apply to all series of
Notes. Each Series Supplement will contain provisions that generally apply only
to the series of Notes issued under that Series Supplement.
MODIFICATION OF INDENTURE OR SERIES SUPPLEMENT WITHOUT NOTEHOLDER
CONSENT. The Trust and the Indenture Trustee may, without consent of the
Noteholders but with prior notice to the Rating Agencies, enter into one or more
supplemental indentures or amendments to any Series Supplement for any of the
following purposes:
(1) to correct or amplify the description of the collateral or add
additional collateral;
(2) to provide for the assumption of the Notes and the Indenture
obligations by a permitted successor to the Trust;
(3) to add additional covenants for the benefit of the Noteholders of one
or more series of Notes;
(4) to convey, transfer, assign, mortgage or pledge any property to or with
the Indenture Trustee;
(5) to cure any ambiguity or correct or supplement any provision in the
Indenture or in any Series Supplement or supplemental indenture which
may be inconsistent with any other provision of the Indenture or of any
Series Supplement or supplemental indenture;
(6) to provide for the acceptance of the appointment of a permitted
successor Indenture Trustee or to add to or change any of the
provisions of the Indenture or any Series Supplement as may be
necessary and permitted to facilitate the administration by more than
one trustee;
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(7) to modify, eliminate or add to the provisions of the Indenture or any
Series Supplement in order to comply with the Trust Indenture Act of
1939; and
(8) to add any provisions to change in any manner or eliminate any of the
provisions of the Indenture or modify in any manner the rights of
Noteholders under the Indenture or a Series Supplement; provided that
any action specified in this clause (8) does not adversely affect in
any material respect the interests of any Noteholder unless the
Noteholder consent is obtained as described below.
MODIFICATION OF INDENTURE OR SERIES SUPPLEMENT WITH NOTEHOLDER
CONSENT. With the consent of the holders of a majority in principal amount of
the Controlling Class of each series of Notes affected thereby and prior written
notice to the Rating Agencies, the Trust and the Indenture Trustee may execute a
supplemental indenture to add provisions to, change in any manner or eliminate
any provisions of the Indenture or a Series Supplement, or modify in any manner
the rights of the related Noteholders. 'CONTROLLING CLASS' means, with respect
to a series of Notes, (1) if there is only one class of Notes in that series,
all the Notes of that series, and (2) if there is more than one class of Notes
outstanding in that series, the class or classes with the highest rating.
Without the consent of the holder of each outstanding Note affected
thereby, however, no supplemental indenture will:
(1) change the due date of any installment of principal of or interest on
any Note or reduce the principal amount thereof, the applicable
interest rate, unless specifically permitted under the terms of the
Note, or the redemption price for a Note or change any place of payment
where or the coin or currency in which any Note or any interest thereon
is payable or modify any of the provisions of the Indenture in a manner
that would affect the calculation of the amount of any payment of
interest or principal due on any Note on any Payment Date;
(2) impair the right to institute suit for the enforcement of specified
provisions of the Indenture regarding payment;
(3) reduce the percentage of the aggregate principal amount of the
outstanding Notes, the consent of the holders of which is required for
any specified supplemental indenture or the consent of the holders of
which is required for any waiver of compliance with specified
provisions of the Indenture or of specified defaults under the
Indenture and their consequences as provided for in the Indenture;
(4) modify or alter the provisions of the Indenture regarding the voting of
Notes held by the Trust, any other obligor on the Notes, the Transferor
or an affiliate of any of them;
(5) reduce the percentage of the aggregate outstanding principal amount of
the 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 the sale would be insufficient to pay the principal amount and
accrued but unpaid interest on the outstanding Notes;
(6) decrease the percentage of the aggregate outstanding principal amount
of the Notes required to amend the sections of the Indenture which
specify the applicable percentage of aggregate outstanding principal
amount of the Notes necessary to amend the Indenture; or
(7) permit the creation of any lien ranking prior to or on a parity with
the lien of the Indenture on any part of the Trust Estate or, except as
otherwise permitted or contemplated in the Indenture, terminate the
lien of the Indenture on the Trust Estate or deprive the holder of any
Note of the security afforded by the lien of the Indenture.
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EVENTS OF DEFAULT; RIGHTS UPON EVENT OF DEFAULT. 'EVENTS OF DEFAULT' for a
series of Notes under the applicable Series Supplement will consist of:
(1) any failure to pay interest on the Notes as and when the same becomes
due and payable, which failure continues unremedied for five days;
(2) any failure to make any required payment of principal on the Notes,
other than the final payment, which failure continues unremedied for
five days after the giving of written notice of the failure (a) to the
Servicer by the Indenture Trustee or (b) to the Servicer and the
Indenture Trustee by the holders of not less than 25% of the aggregate
outstanding principal amount of the Notes;
(3) any failure to observe or perform in any material respect any other
covenants or agreements in the Indenture, which failure materially and
adversely affects the rights of related Noteholders, and which failure
in either case continues for 30 days after the giving of written notice
of the failure (a) to the Trust and the Transferor (or the Servicer, as
applicable) by the Indenture Trustee or (b) to the Trust, the
Transferor (or the Servicer, as applicable) and the Indenture Trustee
by the holders of not less than 25% of the principal amount of the
related Notes;
(4) failure to pay the unpaid principal balance of any series or class of
Notes by the final payment date for that series or class, if any, set
forth in the prospectus supplement for that series; and
(5) specified events of bankruptcy, insolvency or receivership relating to
the Trust.
The amount of principal required to be paid to Noteholders under the
Indenture will generally be limited to amounts available to be deposited in the
Principal Funding Account for such series. Therefore, the failure to pay
principal on a series or class of Notes generally will not result in the
occurrence of an Event of Default until the applicable final payment date, if
any, for that series or class.
If an Event of Default should occur and be continuing with respect to any
series of Notes, the Indenture Trustee or the holders of a majority in principal
amount then outstanding of the Controlling Class for that series, may declare
the principal of those Notes to be immediately due and payable. This declaration
will constitute an Early Amortization Event for that series and may, under
specified circumstances, be rescinded by the holders of a majority in principal
amount of the Controlling Class. See '--Investment Events and Early Amortization
Events.'
If the Notes of any series are declared due and payable following an Event
of Default with respect to that series, the Indenture Trustee may institute
proceedings to:
(1) collect amounts due or foreclose on Trust property,
(2) exercise remedies as a secured party,
(3) if the Event of Default relates to the failure to make any required
payment of interest or principal and the principal amount of those
Notes has been declared due and payable, sell the portions of the
related Trust Estate allocated to that series as described in the
prospectus supplement for that series, or
(4) elect to have the Trust maintain possession of the portions of the
Trust Estate allocated to that series and continue to apply Collections
as if there had been no declaration of acceleration (although the Early
Amortization Period commenced by that declaration will continue unless
the declaration is rescinded).
The Indenture Trustee, however, is prohibited from selling or liquidating an
interest in the Trust Estate following an Event of Default, unless:
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(1) the holders of all the outstanding Notes of the affected Series consent
to the sale,
(2) the proceeds of the sale are sufficient to pay in full the principal of
and the accrued interest on the outstanding Notes of the affected
Series at the date of the sale, or
(3) in specified cases, the Indenture Trustee determines that the Trust
Estate is reasonably unlikely to provide sufficient funds on an ongoing
basis to make all payments on the Notes as those payments would have
become due if the Notes had not been declared due and payable, and the
Indenture Trustee obtains the consent of the holders of a majority of
the aggregate outstanding principal amount of the Controlling Class of
such series of the Notes.
Following a declaration that the Notes of any series are immediately due
and payable,
(1) Noteholders will be entitled to pro rata repayment of principal on the
basis of their respective unpaid principal balances, and
(2) repayment in full of the accrued interest on and unpaid principal
balances of the Notes of that series will be made prior to any further
distribution on the subordinated portion of the Certificates.
Subject to the provisions of the Indenture regarding the duties of the
Indenture Trustee, if an Event of Default occurs and is continuing with respect
to the Notes of any series or class, 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 holders of the Notes, if the Indenture
Trustee reasonably believes it will not be adequately indemnified against the
costs, expenses and liabilities which might be incurred by it in complying with
that request. Subject to the provisions for indemnification and limitations
specified in the Indenture, the holders of a majority in aggregate principal
amount of the outstanding Notes of the Controlling Class of a series will have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Indenture Trustee for that series. The holders of a
majority in aggregate principal amount then outstanding of the Controlling
Class, may, in specified cases, waive any default with respect to that series,
except a default in the payment of principal or interest or a default in respect
of a covenant or provision of the Indenture or the applicable Series Supplement
that cannot be modified without the waiver or consent of all of the holders of
the Notes of that series.
No holder of a Note of any series will have the right to institute any
proceeding under the Indenture, unless:
(1) the holder's Note is in the Controlling Class,
(2) the holder previously has given to the Indenture Trustee written
notice of a continuing Event of Default,
(3) the holders of not less than 25% in aggregate principal amount of the
outstanding Notes of the Controlling Class, have made written request
of the Indenture Trustee to institute a proceeding in its own name as
Indenture Trustee,
(4) the holder or holders have offered the Indenture Trustee reasonable
indemnity,
(5) the Indenture Trustee has for 60 days failed to institute a
proceeding, and
(6) no direction inconsistent with the written request has been given to
the Indenture Trustee during the 60-day period by the holders of a
majority in aggregate principal amount of outstanding Notes.
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If an Event of Default occurs and is continuing with respect to any series
of Notes and if it is known to the Indenture Trustee, the Indenture Trustee will
mail notice of the Event of Default to each Noteholder of that series within 60
days after it occurs. Except in the case of a failure to make any required
payment of principal or interest on any Note, the Indenture Trustee may withhold
the notice beyond the 60-day period if and so long as it determines in good
faith that withholding the notice is in the interests of the Noteholders of the
related series.
In addition, the Indenture Trustee and each Noteholder and Note Owner, by
accepting a Note (or interest of a Note), will covenant that they will not, for
a period of one year and one day after the termination of the Indenture,
institute against the Trust or Transferor any bankruptcy, reorganization or
other proceeding under any federal or state bankruptcy or similar law.
Neither the Indenture Trustee in its individual capacity nor the Owner
Trustee in its individual capacity, nor any holder of a Certificate, including
the Transferor, nor any of their respective owners, beneficiaries, agents,
officers, directors, employees, affiliates, successors or assigns will, in the
absence of an express agreement to the contrary, be personally liable for the
payment of the principal of or interest on the Notes or for the agreements of
the Trust contained in the Indenture or in any Series Supplement.
CERTAIN COVENANTS. The Indenture provides that the Trust may not
consolidate with or merge into any other entity, unless, among other things:
(1) the entity formed by or surviving the merger or the consolidation is
organized under the laws of the United States, any state or the
District of Columbia,
(2) the entity expressly assumes the Trust's obligation to make due and
punctual payments on the Notes and the performance or observance of
every agreement and covenant of the Trust under the Indenture and each
Series Supplement,
(3) no Event of Default shall have occurred and be continuing immediately
after the merger or consolidation,
(4) the Trust has been advised that the ratings of the Notes would not be
reduced or withdrawn by any nationally recognized rating agency
designated by the Transferor in the related Series Supplement or
otherwise then rating the Notes of that series (each a 'RATING AGENCY'
and, together, the 'RATING AGENCIES') as a result of the merger or
consolidation,
(5) any action necessary to maintain the lien and security interest
created by the Indenture has been taken, and
(6) the Trust has received a Tax Opinion regarding the merger or
consolidation.
The Trust will not, among other things, except as expressly permitted by
the Indenture, the Series Supplements or the Transfer and Servicing Agreements
(collectively, the 'RELATED DOCUMENTS'),
(1) sell, transfer, exchange or otherwise dispose of any of the assets of
the Trust,
(2) claim any credit on or make any deduction from the principal or
interest payable in respect of the Notes (other than amounts withheld
under the U.S. Internal Revenue Code or applicable state law) or
assert any claim against any present or former holder of the Notes
because of the payment of taxes levied or assessed upon any part of
the Trust Estate,
(3) dissolve or liquidate in whole or in part,
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(4) permit the validity or effectiveness of the Indenture to be impaired
or permit any person to be released from any covenants or obligations
with respect to the Notes under the Indenture except as may be
expressly permitted thereby,
(5) permit 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 Estate or any part thereof, or any interest
therein or the proceeds thereof, or
(6) permit the lien of the Indenture not to constitute a valid first
priority security interest in the Trust Estate.
Except as specified in the related prospectus supplement, the Trust may not
engage in any activity other than as described above under 'THE TRUST.' The
Trust will not incur, assume or guarantee any indebtedness other than
indebtedness incurred pursuant to the Notes, the Indenture, or otherwise in
accordance with the Transfer and Servicing Agreements.
ANNUAL COMPLIANCE STATEMENT. The Trust will be required to file annually
with the Indenture Trustee a written statement as to the fulfillment of its
obligations under the Indenture.
INDENTURE TRUSTEE'S ANNUAL REPORT. The Indenture Trustee will be required
to mail each year to all Noteholders, to the extent required under the Trust
Indenture Act of 1939, a brief report relating to:
(1) its eligibility and qualification to continue as Indenture Trustee
under the Indenture,
(2) any amounts advanced by it under the Indenture,
(3) the amount, interest rate and maturity date of specified indebtedness
owing by the Trust to the Indenture Trustee in its individual
capacity,
(4) the property and funds physically held by the Indenture Trustee as
trustee, and
(5) any action taken by it that materially affects the Notes and that has
not been previously reported.
SATISFACTION AND DISCHARGE OF INDENTURE. The Indenture will be discharged
with respect to the Notes of any series upon the delivery of all the Notes of
that series to the Indenture Trustee for cancellation or upon deposit of funds
sufficient for the payment in full of all of the Notes of that series with the
Indenture Trustee.
EXCLUDED SERIES
A series of Notes may be designated as an excluded series (an 'EXCLUDED
SERIES') with respect to a series of Notes previously issued by the Trust as to
which the Accumulation Period or Controlled Amortization Period has commenced
(the previously issued series being the 'PAIRED SERIES').
Each Excluded Series will be prefunded with an initial deposit to a
prefunding account in an amount equal to the initial principal balance of the
Excluded Series and primarily from the proceeds of the offering of the Excluded
Series. The prefunding account will be held for the benefit of the Excluded
Series and not for the benefit of the Paired Series. As funds are accumulated in
the Principal Funding Account for the Paired Series or are distributed to
holders of Notes of the Paired Series, an equal amount of funds on deposit in
any prefunding account for the prefunded Excluded Series will be released (which
funds are expected to be distributed to the Certificateholders). Non-Principal
Collections, Principal Collections, Defaulted Amounts or Miscellaneous Payments
will be allocated to the Excluded Series only with respect to the portion of
funds released from the prefunding account. In addition, it is expected that any
Excluded Series will be excluded from the calculation of the Required Pool
Balance to
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the extent amounts are held in the prefunding account as described under 'The
Transfer and Servicing Agreements--Addition of Accounts.'
COLLECTION ACCOUNT
The Servicer has established and will maintain an Eligible Deposit Account
for the benefit of the Noteholders in the name of the Indenture Trustee (the
'COLLECTION ACCOUNT') into which the Servicer will deposit collections as
described in '--Allocation of Collections; Deposits in Collection Account.'
'ELIGIBLE DEPOSIT ACCOUNT' means either
(a) a segregated account with an Eligible Institution or
(b) a segregated trust account with the corporate trust department of a
depository institution organized under the laws of the United States
or any one of the states thereof, including the District of Columbia
(or any domestic branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so
long as any of the securities of the depository institution has a
credit rating from each Rating Agency in one of its generic rating
categories which signifies investment grade.
'ELIGIBLE INSTITUTION' means
(a) the corporate trust department of the Indenture Trustee or
(b) a depository institution organized under the laws of the United States
or any one of the states thereof, or the District of Columbia (or a
domestic branch of a foreign bank), which at all times:
(1) has either:
(x) a long-term unsecured debt rating of Aa2 or better by Moody's
Investors Service, Inc. ('MOODY'S'), AA or better by Standard
& Poor's Ratings Services ('STANDARD & POOR'S') and, if rated
by Fitch IBCA, Inc. ('FITCH'), AA or better by Fitch so long
as Fitch is a Rating Agency or such other rating as is
acceptable to each Rating Agency or
(y) a certificate of deposit rating of P-1 by Moody's, A-1 by
Standard & Poor's and, if rated by Fitch, F-1 by Fitch so long
as Fitch is a Rating Agency or such rating as is acceptable to
each Rating Agency
and
(2) is a member of the Federal Deposit Insurance Corporation.
Funds in the Collection Account generally will be invested in Eligible
Investments.
'ELIGIBLE INVESTMENTS' means any of the following, in each case with a
remaining term of no more than one year:
(a) direct obligations of, and obligations guaranteed as to full and
timely payment by, the United States or any agency or instrumentality
of the United States the obligations of which are backed by the full
faith and credit of the United States (other than the Government
National Mortgage Association);
(b) direct obligations of, or obligations fully guaranteed by, the Federal
National Mortgage Association or any state then rated with the highest
available credit rating of the Rating
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Agencies for such obligations; the obligations must also be, at the
time of investment, otherwise acceptable to each Rating Agency;
(c) demand deposits, time deposits, certificates of deposit, bankers'
acceptances issued by, or federal funds sold by any depository
institution or trust company, including the Indenture Trustee,
incorporated under the laws of the United States or any state thereof
(or any domestic branch of a foreign bank) and subject to supervision
and examination by federal or state banking or depository institution
authorities, and whose deposits are fully insured by the Federal
Deposit Insurance Corporation, so long as at the time of the Trust's
investment or contractual commitment to invest therein, such
depository institution or trust company has the Required Rating or the
Indenture Trustee shall have received a letter from each Rating Agency
to the effect that such investment would not result in the
qualification, downgrading or withdrawal of the ratings then assigned
to the Rated Securities;
(d) repurchase obligations held by the Indenture Trustee that are
acceptable to the Indenture Trustee for any security described in
clause (a) above or (f) below, or any other security issued or
guaranteed by any agency or instrumentality of the United States, in
either case entered into with a federal agency or depository
institution or trust company, including the Indenture Trustee, acting
as principal, whose obligations, if they had the same maturity as a
repurchase agreement, would be Eligible Investments under clause (b)
or (c) above;
(e) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States or any
state so long as at the time of such investment either the long-term,
unsecured debt of such corporation has the highest available rating
from the Rating Agencies or the Indenture Trustee shall have received
a letter from each Rating Agency stating that the investment would not
result in the qualification, downgrading or withdrawal of the ratings
then assigned to any Rated Securities, or commercial paper or other
short-term debt having the Required Rating; however, any such
commercial paper or other short-term debt may have a remaining term to
maturity of no longer than 30 days after the date of such investment;
(f) interests in any open-end or close-end management type investment
company or investment trust registered under the Investment Company
Act, whose portfolio is limited to the obligations of, or guaranteed
by, the United States and to agreements to repurchase such
obligations, which agreements, for principal and interest, are at
least 100% collateralized by such obligations marked to market on a
daily basis and the investment company or investment trust shall take
delivery of such obligations either directly or through an independent
custodian designated in accordance with the Investment Company Act and
acceptable to each Rating Agency, as approved in writing by each
Rating Agency, as collateral for securities having ratings equivalent
to the ratings of the Rated Securities on the closing date;
(g) guaranteed reinvestment agreements issued by any bank, insurance
company or other corporation, as approved in writing by each Rating
Agency, as will not result in the qualification, downgrading or
withdrawal of the ratings then assigned to the Rated Securities by
each Rating Agency;
(h) investments in Eligible Investments maintained in 'sweep accounts,'
short-term asset management accounts and the like utilized for the
investment, on an overnight basis, of residual balances in investment
accounts maintained at the Indenture Trustee or any other depository
institution or trust company organized under the laws of the United
States or any state that is a member of the Federal Deposit Insurance
Corporation, the short-term debt of which has the highest available
credit rating of the Rating Agencies;
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(i) guaranteed investment contracts entered into with any financial
institution having a final maturity of not more than one month from
the date of acquisition, the short-term debt securities of which
institution have the Required Rating;
(j) funds classified as money market funds or invested in money market
instruments consisting of: U.S. Treasury bills, other obligations
issued or guaranteed by the U.S. government, its agencies or
instrumentalities; certificates of deposit; banker's acceptances; and
commercial paper (including variable master demand notes); provided,
however, that the fund shall be rated with the highest available
credit rating of Moody's, Standard & Poor's and, if rated by Fitch,
Fitch so long as Fitch is a Rating Agency and redemptions shall be
permitted on a daily or next business day basis and including funds to
which the Indenture Trustee or any of its affiliates is a manager of
advisor; and
(k) other investments acceptable to each Rating Agency, as approved in
writing by each Rating Agency, as will not result in the
qualification, downgrading or withdrawal of the ratings then assigned
to any Rated Securities by such Rating Agency.
Notwithstanding anything to the contrary contained in the foregoing
definition:
(a) no Eligible Investment may be purchased at a premium;
(b) any of the foregoing which constitutes a certificated security shall
not be considered an Eligible Investment unless
(1) in the case of a certificated security that is in bearer form,
the Indenture Trustee acquires physical possession of such
certificated security, or a person, other than a securities
intermediary, acquires possession of such certificated security
on behalf of the Indenture Trustee; and
(2) in the case of a certificated security that is in registered
form,
(A) the Indenture Trustee acquires physical possession of the
certificated security, a person, other than a securities
intermediary, acquires possession of the certificated
security for the Indenture Trustee, or a securities
intermediary acting for the Indenture Trustee acquires
possession of the certificated security and the
certificated security has been specially endorsed to the
Indenture Trustee, and
(B) the certificated security is endorsed to the Indenture
Trustee or in blank by an effective Endorsement, or the
certificated security is registered in the name of the
Indenture Trustee;
(c) any of the foregoing that constitutes an uncertificated security shall
not be considered an Eligible Investment unless
(1) the Indenture Trustee is registered by the issuer as the owner of
the Eligible Investment,
(2) a person, other than a securities intermediary, becomes the
registered owner of the uncertificated security on behalf of the
Indenture Trustee, or
(3) the issuer of the uncertificated security agrees that it will
comply with the instructions originated by the Indenture Trustee
without further consent by any registered owner of the
uncertificated security;
(d) any of the foregoing that constitutes a security entitlement shall not
be considered an Eligible Investment unless the Indenture Trustee
becomes the entitlement holder thereof, or the
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securities intermediary has agreed to comply with the entitlement
orders originated by the Indenture Trustee without further consent by
the entitlement holder; and
(e) any of the foregoing shall not constitute an Eligible Investment
unless the Indenture Trustee has given value, and does not have notice
of a materially adverse claim.
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 any Rated Securities by such Rating Agency.
'RATED SECURITIES' means each class of securities that has been rated by a
Rating Agency at the request of the Transferor.
'REQUIRED RATING' means a rating on commercial paper or other short term
unsecured debt obligations of Prime-1 by Moody's so long as Moody's is a Rating
Agency, A-1 by Standard & Poor's so long as Standard & Poor's is a Rating Agency
and, if rated by Fitch, F-1 by Fitch so long as Fitch is a Rating Agency; and
any requirement that deposits or debt obligations have the 'Required Rating'
shall mean that such deposits or debt obligations have the foregoing required
ratings from Moody's, Standard & Poor's and Fitch.
Any earnings (net of losses and investment expenses) on funds in the
Collection Account will be credited to the Collection Account. The Servicer will
have the revocable power to instruct the Indenture Trustee to make withdrawals
and payments from the Collection Account for the purpose of carrying out its
duties under the Indenture. The Servicer may select an appropriate agent as
representative of the Servicer for the purpose of designating investments.
EXCESS FUNDING ACCOUNT
The Servicer has established and will maintain an Eligible Deposit Account
for the benefit of the Noteholders in the name of the Indenture Trustee (the
'EXCESS FUNDING ACCOUNT') into which the Servicer will deposit the net proceeds
from the issuance of any new series of Notes or any increase in the principal
amount of any series of Notes in an amount equal to the excess of the Required
Pool Balance over the Pool Balance. The remainder of such funds may be
distributed to the Certificateholders or, at their direction, deposited in the
Excess Funding Account. In addition, the Certificateholders may direct the
Servicer, Owner Trustee and Indenture Trustee to deposit any amounts otherwise
distributable to the Certificateholders into the Excess Funding Account.
Funds on deposit in the Excess Funding Account will be invested by the
Indenture Trustee at the direction of the Servicer generally in Eligible
Investments. Any earnings (net of losses and investment expenses) on funds in
the Excess Funding Account will be deposited in the Collection Account and shall
be Investment Proceeds when so deposited.
'POOL BALANCE' means, as of the time of determination thereof, the
aggregate amount of Principal Receivables, excluding any Defaulted Receivables
after the Payment Date in which it became a Defaulted Receivable in the Trust at
such time, minus the aggregate balance on such date in dealer accounts in World
Omni's Floorplan Equity Program.
'PRINCIPAL RECEIVABLES' means, with respect to an Account, amounts shown on
the Servicer's records as Receivables (other than such amounts which represent
Non-Principal Receivables) payable by the related dealer plus the amount of any
Purchased Participation Receivable or interest therein; provided, that if a
Participation has been created in respect of such Account, the amounts so
payable by the related Dealer that are allocable to such Participation shall not
be a part of the 'Principal Receivables' with respect to such Receivable.
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'REQUIRED POOL BALANCE' shall mean on any day, an amount equal to (a) the
sum of the amounts for each series (other than any series or portion thereof
which is designated as being an Excluded Series until the Invested Amount of the
series relating to the Excluded Series is zero) obtained by multiplying the
Required Participation Percentage (as specified in the related prospectus
supplement) by the Invested Amount for such series at such time plus (b) the sum
of the Available Subordinated Amount (as specified in the related prospectus
supplement) for each series.
On each day, available amounts, including Principal Collections allocated
to each series during the Revolving Period for such series, will be deposited in
the Excess Funding Account to the extent that the Required Pool Balance exceeds
the Pool Balance on such date. in the Excess Funding Account to the extent that
the Required Pool Balance exceeds the Pool Balance on such date. Generally, no
funds will be deposited in the Excess Funding Account during an Early
Amortization Period or Investment Period for a series or for any other period
specified in the Series Supplement for that series. Funds on deposit in the
Excess Funding Account will be withdrawn and paid to the Certificateholders or
allocated to one or more other series of Notes which are in an Amortization,
Early Amortization, Investment or Accumulation Period and distributed in
accordance with the applicable Series Supplement.
ALLOCATION PERCENTAGES
ALLOCATIONS AMONG SERIES. Pursuant to the Indenture, during each
Collection Period the Servicer will allocate to each outstanding series its
share of Non-Principal Collections, Principal Collections, Defaulted Receivables
and Miscellaneous Payments based on the applicable Series Allocable Non-
Principal Collections, Series Allocable Principal Collections, Series Allocable
Defaulted Amount and Series Allocable Miscellaneous Payments.
'INITIAL INVESTED AMOUNT' means, for any series and for any date, the
amount specified in the related Series Supplement. The Initial Invested
Amount for any series may be increased or decreased from time to time as
specified in the related Series Supplement.
'MISCELLANEOUS PAYMENTS' for any Collection Period means the sum of
Adjustment Payments and Transfer Deposit Amounts on deposit in the
Collection Account on the related Payment Date available to be treated as
Miscellaneous Payments.
'RESET DATE' means the last day of a Collection Period and the business
day immediately preceding an Advance Date or a Pay Down Date, each as
specified in the related series Supplement.
'SERIES ADJUSTED INVESTED AMOUNT' means, for a series for any date, an
amount equal to the sum of (a) the Initial Invested Amount of that series on
the most recent Reset Date and (b) the Target Available Subordinated Amount
for that series on the most recent Reset Date.
'SERIES ALLOCABLE NON-PRINCIPAL COLLECTIONS,' 'SERIES ALLOCABLE
PRINCIPAL COLLECTIONS,' 'SERIES ALLOCABLE DEFAULTED AMOUNT' and 'SERIES
ALLOCABLE MISCELLANEOUS PAYMENTS' mean, for any series for any day, the
product of the Series Allocation Percentage for that series and the amount
of Non-Principal Collections, Principal Collections, the Defaulted Amount
and Miscellaneous Payments, respectively, for such day.
'SERIES ALLOCATION PERCENTAGE' means, for a series for any day, the
percentage equivalent of a fraction, the numerator of which is the Series
Adjusted Invested Amount as of such day and the denominator of which is the
Trust Adjusted Invested Amount as of such day.
'TARGET AVAILABLE SUBORDINATED AMOUNT' means, for a series for any day,
the Available Subordinated Amount that would result if the Available
Subordinated Amount for each series was calculated as if the amount on
deposit in the Excess Funding Account was zero and the Incremental
Subordinated Amount (as defined in the related prospectus supplement) was
zero.
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'TRUST ADJUSTED INVESTED AMOUNT' means, for any day, the sum of the
Series Adjusted Invested Amounts for all outstanding series.
ALLOCATION BETWEEN THE NOTEHOLDERS AND THE CERTIFICATEHOLDERS. The
Servicer will allocate amounts initially allocated to each series between the
Notes and the Certificates for each Collection Period as described in the
prospectus supplement. If a series of Notes consists of more than one class, the
amounts allocated to the Notes of that series will be allocated between the
classes as described in the prospectus supplement for that series.
EXCESS PRINCIPAL COLLECTIONS FOR ALL SERIES. Principal Collections
allocated to the Notes of a series will first be allocated to make required
payments of principal to the Principal Funding Account or to the Noteholders of
that series or a class of that series, in each case if and to the extent
specified in the Series Supplement for that series. The Servicer will determine
for each Collection Period the amount of available noteholder principal
collections for each series remaining after the required payments, if any
('EXCESS PRINCIPAL COLLECTIONS'). The Servicer will allocate Excess Principal
Collections to cover any principal distributions to Noteholders of any series
which are either scheduled or permitted and which have not been covered out of
Principal Collections and other specified amounts allocated to that series
('PRINCIPAL SHORTFALLS'). Excess Principal Collections will not be used to cover
unreversed receivable charge-offs ('INVESTOR CHARGE-OFFS') for any series. If
Principal Shortfalls exceed Excess Principal Collections for any Collection
Period, Excess Principal Collections generally will be allocated pro rata among
the applicable series based on the relative amounts of Principal Shortfalls. To
the extent that Excess Principal Collections exceed Principal Shortfalls, the
balance will be first, deposited into the Excess Funding Account to the extent
the Required Pool Balance exceeds the Pool Balance and second, distributed to
the Certificateholders in accordance with the Trust Agreement.
ALLOCATION OF COLLECTIONS; DEPOSITS IN COLLECTION ACCOUNT
The Servicer, no later than two business days after the processing date,
will deposit all collections received with respect to the Receivables (excluding
portions allocable to the Transferor) in each calendar month (each, a
'COLLECTION PERIOD') into the Collection Account. Notwithstanding the foregoing
requirement for daily deposits, for so long as:
(1) World Omni remains the Servicer under the Trust Sale and Servicing
Agreement,
(2) no Servicing Default has occurred and is continuing, and
(3) World Omni either (a) maintains a short-term debt rating of at least
A-1 by Standard & Poor's and P-1 by Moody's, (b) arranges for and
maintains a letter of credit or other form of Enhancement for the
Servicer's obligations to make deposits of collections on the
Receivables in the Collection Account that is acceptable in form and
substance to each Rating Agency or (c) otherwise obtains the Rating
Agency confirmations described below, then, subject to any limitations
in the confirmations referred to below,
World Omni need not deposit collections into the Collection Account on the day
indicated in the preceding sentence but may use for its own benefit all of those
collections until the Payment Date (whether or not such funds will be
distributed to Noteholders, retained in the Collection Account or deposited in
another account on such Payment Date), at which time World Omni will make the
deposits in an amount equal to the net amount of the deposits and withdrawals
which would have been made had the conditions of this sentence not applied;
provided, however, that prior to ceasing daily deposits as described above, the
Servicer shall have delivered to the Indenture Trustee and the Owner Trustee
written confirmation from the applicable Rating Agencies that the failure by
World Omni to make daily deposits will not result in a reduction or withdrawal
of the rating of any outstanding series or class of Notes.
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In addition, during any Collection Period, the Servicer will generally be
required to deposit collections into the Collection Account only up to the
aggregate amount of collections required to be deposited into any deposit,
trust, reserve or similar account maintained for the benefit of Noteholders of
any series or, without duplication, distributed on the related Payment Date to
Noteholders, to any agent or to any Enhancement Provider pursuant to the terms
of any Series Supplement or enhancement agreement with respect to the related
Collection Period and if, at any time prior to that Payment Date, the amount of
collections deposited in the Collection Account exceeds the amount required to
be deposited, the Servicer will be permitted to withdraw the excess from the
Collection Account.
On any date on which collections are deposited in the Collection Account,
the Servicer will distribute to the Certificateholders in accordance with the
Trust Agreement the portion allocated to the Certificateholders of the
Non-Principal Collections allocable to each series as specified in the related
Series Supplement and described in the related prospectus supplement.
SUBORDINATION OF CERTIFICATE; ENHANCEMENTS
SUBORDINATION OF CERTIFICATES. The Certificates will be subordinated to
the rights of Noteholders of each series of Notes to the extent described in the
related prospectus supplement. The amount of the subordination for any series of
Notes is referred to herein as the 'AVAILABLE SUBORDINATED AMOUNT' for that
series. The Available Subordinated Amount for any series of Notes will be
subject to decrease and increase if and to the extent described in the related
prospectus supplement. The prospectus supplement for each series of Notes will
describe the manner in which collections attributable to the Available
Subordinated Amount for that series may be drawn upon to make payments to or for
the benefit of the holders of Certificates of that series. If so provided in the
related Series Supplements, the Available Subordinated Amount for a series of
Notes may be structured so as to be available to more than one series of Notes.
ENHANCEMENTS. In addition to the subordination described above, for any
series of Notes, Enhancements may be provided for one or more classes of Notes.
Enhancements for one or more classes of a series of Notes may include a letter
of credit, surety bond, cash collateral account, spread account, guaranteed rate
agreement, swap or other interest protection agreement, repurchase obligation,
cash deposit or another form of credit enhancement described in the related
prospectus supplement or any combination of the foregoing. Enhancements may also
be provided to a series or class or classes of a series by subordination
provisions which require that distributions of principal and/or interest be made
with respect to the Notes of that series, class or classes before distributions
are made to one or more other series or classes. If so specified in the related
prospectus supplement, any form of Enhancement may be structured so as to be
available to more than one class or series to the extent described therein.
If Enhancement is provided for a series of Notes, the related prospectus
supplement will include a description of
o the amount payable under that Enhancement,
o any conditions to payment thereunder not otherwise described herein,
o the conditions under which the amount payable under that Enhancement may
be reduced and the conditions under which that Enhancement may be
terminated or replaced, and
o any material provisions of any agreement applicable relating to that
Enhancement.
Additionally, in specified cases, the related prospectus supplement may set
forth information for the applicable Enhancement Provider, including
o a brief description of its principal business activities,
o its principal place of business, place of organization and the
jurisdiction under which it is chartered or licensed to do business,
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o if applicable, the identity of regulatory agencies which exercise
primary jurisdiction over the conduct of its business, and
o its total assets, and its stockholders' equity or policyholders'
surplus, if applicable, as of a date specified in the related prospectus
supplement.
LIMITATIONS ON SUBORDINATION AND ENHANCEMENTS. The presence of an
Available Subordinated Amount or Enhancement for a series or class of Notes is
intended to enhance the likelihood of receipt by Noteholders of that series or
class of the full amount of principal of and interest on that series or class
and to decrease the likelihood that the Noteholders will experience losses.
However, neither subordination of the Certificates nor the Enhancement for that
series or class will provide protection against all risks of loss or will
guarantee repayment of the entire principal balance of and interest on the
Notes. If losses occur which exceed the amount covered by the subordination or
Enhancement or which are not covered by the subordination or Enhancement,
Noteholders will bear their allocable share of deficiencies. In addition, if
specific Enhancement is provided for the benefit of more than one class or
series, Noteholders of that class or series will be subject to the risk that the
Enhancement will be exhausted by the claims of Noteholders of other classes or
series.
DISTRIBUTIONS
Payments to Noteholders of a series or a class will be made from the
Collection Account and any accounts established for the benefit of Noteholders
of that series or class as described in the related prospectus supplement.
NEW ISSUANCES
The Indenture provides that the Trust may issue additional series of Notes
pursuant to one or more Series Supplements, which shall specify, among other
things, for any series of Notes:
(1) its name or designation,
(2) its initial principal amount (or method for calculating its initial
principal amount),
(3) its interest rate (or the method for determining its interest rate),
(4) a date on which it will begin its Accumulation Period or Controlled
Amortization Period, if any,
(5) the method for allocating principal and interest to the Noteholders of
that series,
(6) the percentage used to calculate monthly servicing fees,
(7) the issuer and terms of any Enhancement for that series or the level
of subordination provided by the Certificates,
(8) the terms on which the Notes of the series may be exchanged for Notes
of another series, be subject to repurchase, optional redemption or
mandatory redemption by the Transferor or be remarketed by any
remarketing agent,
(9) the final payment date for that series, and
(10) any other terms permitted by the Indenture (all the foregoing terms,
the 'PRINCIPAL TERMS' of that series).
The Transferor may offer any series of Notes to the public under a prospectus or
other disclosure document (a 'DISCLOSURE DOCUMENT') in transactions either
registered under the Securities Act of 1933 or exempt from registration,
directly or through one or more underwriters or placement agents. There is no
limit to the number of series of Notes that may be issued under the Indenture.
The Indenture provides that the Transferor may specify Principal Terms of a
new series of Notes that differ substantially from any other series. Further,
one or more series of Notes may be in their
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Investment Periods, Early Amortization Periods, Controlled Amortization Periods
or Accumulation Periods while other series are not. Thus, some series of Notes
may be amortizing or accumulating principal, while other series are not.
Moreover, different series of Notes may have the benefits of different forms of
Enhancement issued by different entities. Under the Indenture, the Indenture
Trustee will hold each form of Enhancement only on behalf of the series of Notes
(or a particular class within a series) to which it relates. The Indenture also
provides that the Transferor may specify different certificate rates and Monthly
Servicing Fees for each series of Notes (or a particular class within a series).
In addition, the Transferor has the option under the Indenture to vary among
series of Notes (or classes within a series) the terms upon which that series
(or classes within a series) may be repurchased by the Transferor.
Under the Indenture and pursuant to a Series Supplement, a new series of
Notes may be issued only upon the satisfaction of specified conditions. However,
the terms of any new series will not be subject to prior review by or consent of
the Noteholders of any previously issued series of Notes. The Transferor may
cause the issuance of a new series by notifying the Indenture Trustee and other
parties at least five business days in advance of the applicable Series Issuance
Date. The notice shall state the designation of any series of Notes (and classes
within a series, if any). The Indenture provides that the Indenture Trustee will
issue a new series only upon delivery to it of the following:
(1) a Series Supplement in form satisfactory to the Indenture Trustee
signed by the Owner Trustee on behalf of the Trust and specifying the
Principal Terms of the series,
(2) any Enhancement and related agreement, signed by the Owner Trustee on
behalf of the Trust and the Servicer, as applicable,
(3) an opinion of counsel to the effect that, for federal income tax
purposes, the issuance will not adversely affect the characterization
of the Notes of any outstanding series or class of Notes as debt, the
issuance will not cause a taxable event to any Noteholders, the Trust
will not be an association or publicly traded partnership taxable as a
corporation (an opinion of counsel to the effect referred to in the
three prior clauses with respect to any action is referred to herein
as a 'TAX OPINION') and the new series of Notes will be characterized
as debt, and
(4) written confirmation from the applicable Rating Agencies that the
issuance will not result in a reduction or withdrawal of the rating of
any outstanding series or class of Notes.
Each new issuance is also subject to the condition that the Transferor
shall have represented and warranted that the issuance shall not, in the
reasonable belief of the Transferor, cause an Early Amortization Event or
Investment Event to occur for any outstanding series or class of Notes.
Upon satisfaction of all the foregoing conditions, the Indenture Trustee will
issue the new series of Notes.
THE INDENTURE TRUSTEE
Harris Trust and Savings Bank, an Illinois banking corporation, serves as
trustee under the Indenture (the 'INDENTURE TRUSTEE'). The principal executive
offices of the Indenture Trustee are located at 311 West Monroe Street, 12th
Floor, Chicago, Illinois 60601, and its telephone number is (312) 461-4600.
The Indenture Trustee may give notice of its intent to resign at any time,
in which event the Trust will be obligated to appoint a successor trustee. The
Trust may also remove the Indenture Trustee if the Indenture Trustee ceases to
be eligible to continue as Indenture Trustee under the Indenture, becomes
insolvent, or otherwise becomes incapable of acting. In these circumstances, the
Trust will be obligated to appoint a successor trustee. The holders of a
majority of the aggregate principal amount of the outstanding Notes will also be
entitled to remove the Indenture Trustee and appoint a successor. Any
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resignation or removal of the Indenture Trustee and appointment of a successor
trustee does not become effective until acceptance of the appointment by the
successor trustee.
REPORTS TO NOTEHOLDERS
On or prior to each Payment Date for a series or class of Notes, the
Servicer will prepare and provide to the Indenture Trustee a statement to be
delivered to the related Noteholders on the Payment Date. For each series of
Notes, the statement will include the following information as to the Notes with
respect to that Payment Date or the period since the previous Payment Date, as
applicable:
(1) the total amount distributed to Noteholders;
(2) the amount, if any, of the distribution allocable to principal on each
series or class of Notes;
(3) the amount, if any, of the distribution allocable to interest on each
series or class of Notes;
(4) the aggregate outstanding principal balance for each series or class
of Notes, after giving effect to all payments reported under (2) above
on that date;
(5) the amount of the Monthly Servicing Fee paid to the Servicer with
respect to the related Collection Period or Periods, as the case may
be;
(6) the interest rate applicable for the next Interest Payment Date for
any series or classes of Notes with variable or adjustable rates, if
determinable prior to such date;
(7) the amount of Receivables that became Defaulted Receivables during the
related Collection Period;
(8) the accumulated interest and Principal Shortfalls, if any, on each
series or class of Notes and the change in each of such amounts from
the preceding Payment Date;
(9) the balance of the Excess Funding Account on the last day of the
related Collection Period after giving effect to changes therein or
distributions therefrom on such date; and
(10) with respect to each series of Notes, the items set forth in the
applicable Series Supplement.
Each amount set forth pursuant to subclauses (1) and (2) will be expressed
as a dollar amount per $1,000 of the initial principal balance of the Notes.
Within the prescribed period of time for tax reporting purposes after the
end of each calendar year during which any Notes are outstanding, the Indenture
Trustee shall furnish (or cause to be furnished) to each person or entity who at
any time during the preceding calendar year was a holder of record of Notes or
Certificates respectively, and received any payment thereon, a statement
containing such information as may be required by the Code for the purpose of
assisting the Noteholders in the preparation of their federal income tax
returns. As long as the holder of record of the Notes is Cede, as nominee of
DTC, beneficial owners of Notes will receive tax and other information from
Participants and Indirect Participants rather than from the Indenture Trustee.
See 'Certain Federal Income Tax Consequences' in this prospectus.
BOOK-ENTRY REGISTRATION
The Depository Trust Company ('DTC') is a limited purpose trust company
organized under the laws of the State of New York, a member of the Federal
Reserve System, a 'clearing corporation' within the meaning of the New York
Uniform Commercial Code and a 'clearing agency' registered pursuant to Section
17A of the Securities Exchange Act of 1934. DTC was created to hold securities
for its participating organizations ('PARTICIPANTS') and to facilitate the
clearance and settlement of securities transactions between Participants through
electronic book-entries, thereby eliminating the need for physical movement of
certificates. Participants include securities brokers and dealers, banks, trust
companies and clearing corporations. Indirect access to the DTC system also is
available to others, such
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as banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a Participant, either directly or indirectly
('INDIRECT PARTICIPANTS').
Owners of beneficial interest in Notes sold under this prospectus ('NOTE
OWNERS') that are not Participants or Indirect Participants but desire to
purchase, sell or otherwise transfer ownership of or interests in Notes
generally may do so only through Participants and Indirect Participants. In
addition, Note Owners will receive all distributions of principal and interest
through Participants. Under a book-entry format, Note Owners may experience some
delay in their receipt of payments since such payments will be forwarded by the
Indenture Trustee to Cede & Co. ('CEDE'), as nominee for DTC. DTC will forward
such payments to Participants, which thereafter will forward them to Indirect
Participants or Note Owners. It is anticipated that the only 'Noteholder' of
record will be Cede, as nominee of DTC. Note Owners will not be recognized by
the Indenture Trustee as Noteholders, as such term is used in the Indenture, and
Note Owners will be permitted to exercise the rights of Noteholders only
indirectly through DTC and its Participants.
Under the rules, regulations and procedures creating and affecting DTC and
its operations, DTC is required to make book-entry transfers of Notes among
Participants on whose behalf it acts with respect to the Notes and to receive
and transmit payments of principal of, and interest on, the Notes. Participants
and Indirect Participants with which Note Owners have accounts with respect to
the Notes similarly are required to make book-entry transfers and receive and
transmit such payments on behalf of their respective Note Owners. Accordingly,
although Note Owners will not possess Notes, these rules provide a mechanism by
which Note Owners will receive payments and will be able to transfer their
interests in Notes.
Because DTC can only act on behalf of Participants, who in turn act on
behalf of Indirect Participants and some banks, the ability of a holder to
pledge Notes to persons or entities that do not participate in the DTC system,
or to otherwise act with respect to such Notes, may be limited due to the lack
of a physical certificate for such Notes.
DTC has advised the Transferor that it will take any action permitted to be
taken by a Noteholder under the Indenture or other Related Document only at the
direction of one or more Participants to whose accounts with DTC the Notes are
credited. DTC may take conflicting actions with respect to other undivided
interests to the extent that such actions are taken on behalf of Participants
whose holdings include such undivided interests.
In addition to holding Notes through Participants or Indirect Participants
of DTC in the United States as described above, holders of Notes may hold their
Notes through Clearstream or Euroclear in Europe if they are participants of
such systems, or indirectly through organizations which are participants in such
systems.
Clearstream and Euroclear will hold omnibus positions on behalf of their
participants through customers' securities accounts in Clearstream's and
Euroclear's names on the books of their respective depositories which in turn
will hold such positions in customers' securities accounts in the depositories'
names on the books of DTC.
Transfers between the organization participating in the Clearstream system
(the 'CLEARSTREAM PARTICIPANTS') and the Euroclear system (the '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
Clearstream Participants or Euroclear Participants, on the other hand, will be
effected in DTC in accordance with DTC rules on behalf of the relevant European
international clearing systems by its depositary. Cross-market transactions will
require delivery of instructions to the relevant European international clearing
system by the counterparty in such system in accordance with its rules and
procedures and within its established deadlines (European time). The relevant
European international clearing system will, if the transaction
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meets its settlement requirements, deliver instructions to its depositary to
take action to effect final settlement on its behalf by delivering or receiving
securities in DTC, and making or receiving payment in accordance with normal
procedures for same-day funds settlement applicable to DTC. Clearstream
Participants and Euroclear Participants may not deliver instructions directly to
the depositories.
Because of time-zone differences, credits of securities received in
Clearstream or Euroclear as a result of a transaction with a 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
Euroclear or Clearstream Participants on such Business Day. Cash received in
Clearstream or Euroclear as a result of sales of securities by or through a
Clearstream Participant or a Euroclear Participant to a Participant will be
received with value on the DTC settlement date but will be available in the
relevant Clearstream or Euroclear cash account only as of the Business Day
following settlement in DTC. For information with respect to tax documentation
procedures, see 'Certain Federal Income Tax Consequences--Tax Characterization
and Treatment of Notes--Tax Consequences to Foreign Noteholders.'
Clearstream is incorporated under the laws of Luxembourg as a professional
depository. Clearstream holds securities for the Clearstream Participants and
facilitates the clearance and settlement of securities transactions between
Clearstream Participants through electronic book-entry changes in accounts of
Clearstream Participants, thereby eliminating the need for physical movement of
certificates. Transactions may be settled in Clearstream in any of 28
currencies, including United States dollars. Clearstream provides to Clearstream
Participants, among other things, services for safekeeping, administration,
clearance and settlement of internationally traded securities and securities
lending and borrowing. Clearstream interfaces with domestic markets in several
countries. As a professional depository, Clearstream is subject to regulation by
the Luxembourg Monetary Institute. Clearstream Participants are recognized
financial institutions around the world, including underwriters, securities
brokers and dealers, banks, trust companies, clearing corporations and other
organizations and may include the underwriters of the Notes. Indirect access to
Clearstream is also available to others, such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
Clearstream Participant, either directly or indirectly.
Euroclear was created in 1968 to hold securities for the 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 29 currencies, including United States dollars. Euroclear
includes various other services, including securities lending and borrowing and
interfaces with domestic markets in several countries generally similar to the
arrangements 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 Euro-clear Clearance
Systems 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 establishes policy for Euroclear
on behalf of Euroclear Participants. Euroclear Participants include banks
(including central banks), securities brokers and dealers and other professional
financial intermediaries and may include the Underwriters. Indirect access to
Euroclear 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 Governors of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.
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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 the applicable Belgian
law. These terms and conditions govern transfers of securities and cash with
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 these
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 Notes held through Clearstream or Euroclear
will be credited to the cash accounts of Clearstream 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 in accordance with relevant United States tax laws and regulations.
See 'Certain Federal Income Tax Consequences--Tax Characterization and Treatment
of Notes--Information Reporting and Backup Withholding.' Clearstream or the
Euroclear Operator, as the case may be, will take any other action permitted to
be taken by a Noteholder under the Indenture or other Related Document on behalf
of a Clearstream Participant or Euroclear Participant only in accordance with
its relevant rules and procedures and subject to its depositary's ability to
effect such actions on its behalf through DTC.
Although DTC, Clearstream and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of Notes among participants of DTC,
Clearstream and Euroclear, they are under no obligation to perform or continue
to perform such procedures and such procedures may be discontinued at any time.
Except as required by law, neither the Administrator, the Owner Trustee nor
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
Notes of any series held by Cede, as nominee for DTC, by Clearstream or by
Euroclear in Europe, or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
DEFINITIVE NOTES
Notes generally will be issued in fully registered, certificated form
('DEFINITIVE NOTES') to Noteholders or their nominees, rather than to the
Depository or its nominee, only if
(1) the Administrator advises the Indenture Trustee in writing that the
Depository is no longer willing or able to discharge properly its
responsibilities with respect to the Notes and the Trust is unable to
locate a qualified successor,
(2) the Administrator, at its option, advises the Indenture Trustee in
writing that it elects to terminate the book-entry system through the
Depository, or
(3) after the occurrence of an Event of Default or a Servicing Default,
Note Owners representing beneficial interests aggregating at least a
majority of the outstanding principal amount of the Notes advise the
appropriate trustee through the Depository in writing that the
continuation of a book-entry system through the Depository (or a
successor thereto) is no longer in the best interest of such Note
Owners.
Upon the occurrence of any event described in the immediately preceding
paragraph, the Depository will notify the Note Owners and the Indenture Trustee
in writing of such occurrence and of the availability of Definitive Notes. Upon
surrender by the Depository of the definitive certificates representing the
Notes accompanied by registration instructions, the Indenture Trustee will
reissue the related Notes as Definitive Notes to holders thereof.
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Payments of principal of, and interest on, the Definitive Notes will
thereafter be made in accordance with the procedures set forth in the Indenture
directly to holders of Definitive Notes in whose names the Definitive Notes were
registered at the close of business on the last day of the preceding month. Such
payments will be made by check mailed to the address of such holder as it
appears on the register maintained by the Indenture Trustee. The final payment
on any Definitive Note, however, will be made only upon presentation and
surrender of such Definitive Note at the office or agency specified in the
notice of final payment to the holders thereof.
Definitive Notes will be transferable and exchangeable at the offices of
the appropriate trustee or of a registrar named in a notice delivered to holders
of Definitive Notes. No service charge will be imposed for any registration of
transfer or exchange, but the appropriate trustee may require payment of a sum
sufficient to cover any tax or other governmental charge imposed in connection
therewith.
THE TRANSFER AND SERVICING AGREEMENTS
The following summary describes terms of:
(1) the Receivables Purchase Agreement under which the Transferor
purchased Receivables from World Omni,
(2) the Trust Sale and Servicing Agreement under which the Trust acquired
those Receivables from the Transferor and the Servicer agreed to
service the Receivables,
(3) the Trust Agreement under which the Trust was created and Certificates
were issued; and
(4) the Administration Agreement, dated as of the Initial Closing Date,
among the Owner Trustee, the Indenture Trustee and World Omni as
Administrator (the 'ADMINISTRATIVE AGREEMENT'), under which World
Omni, as administrator, has agreed to undertake specified
administrative duties for the Trust and the Indenture.
Collectively, these four agreements are referred to as the 'TRANSFER AND
SERVICING AGREEMENTS.'
Forms of the Transfer and Servicing Agreements have been filed as exhibits
to the registration statement of which this prospectus forms a part. The
Transferor will provide a copy of the Transfer and Servicing Agreements (without
exhibits) upon request of a Noteholder. This summary does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
all of the provisions of the Transfer and Servicing Agreements. Where particular
provisions or terms used in the Transfer and Servicing Agreements are referred
to, the actual provisions are incorporated by reference as part of the summary.
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RECEIVABLES PURCHASE AGREEMENT
SALE OF RECEIVABLES. Pursuant to the Receivables Purchase Agreement, World
Omni sold and transferred to the Transferor all of its right, title and interest
in and to all of the Receivables and related Collateral Security. As described
herein, pursuant to the Trust Sale and Servicing Agreement, the Transferor
transferred to the Trust all of its right, title and interest in and to the
Receivables Purchase Agreement. All new Receivables arising under the Accounts
during the term of the Trust and certain Purchased Participation Receivables
will be sold to the Transferor and transferred by the Transferor to the Trust.
Accordingly, the aggregate amount of Receivables in the Trust will fluctuate
from day to day as new Receivables are generated and as existing Receivables are
collected, charged off as uncollectible or otherwise adjusted.
In connection with the sale of Receivables to the Transferor, World Omni
has indicated in its computer files that the Receivables were sold to the
Transferor and that the Receivables have been transferred by the Transferor to
the Trust. In addition, World Omni delivered to the Transferor a list specifying
all of the Receivables, identifying the principal balances of the Receivables as
of the Initial Closing Date and delivered to the Transferor all documents, if
any, evidencing the Receivables which constitute 'instruments' (as defined in
the Uniform Commercial Code). As a precautionary measure, World Omni has filed
financing statements for the Receivables meeting the requirements of Florida
state law. Otherwise, however, World Omni retains all records relating to
Receivables and does not segregate those records from the records relating to
other accounts. Further, World Omni will not stamp or mark the physical records
to reflect the transfer of the Receivables to the Trust which may affect the
priority of the security interest of the Trust. See 'Risk Factors--Receivables
May be Uncollectible due to Superior Interests' and 'Certain Legal Aspects of
the Receivables--Transfer of Receivables.'
REPRESENTATIONS AND WARRANTIES. World Omni has represented to the
Transferor as of the Initial Closing Date and each Series Issuance Date that,
among other representations, it was duly incorporated and in good standing and
has the authority to consummate the transactions contemplated by the Receivables
Purchase Agreement.
World Omni also represents to the Transferor regarding the Receivables
(other than Purchased Participation Receivables) that:
(1) each Receivable and all Collateral Security existing on the Initial
Closing Date or, in the case of Additional Accounts, on the applicable
Addition Date, and on each Transfer Date, has been conveyed to the
Transferor free and clear of any lien (other than the lien held by
World Omni);
(2) with respect to each Receivable and all Collateral Security existing
on the Initial Closing Date or, in the case of Additional Accounts, on
the applicable Addition Date, and on each Transfer Date, all consents,
licenses, approvals or authorizations of or registrations or
declarations with any governmental authority required to be obtained,
effected or given by World Omni in connection with the conveyance of
such Receivable or Collateral Security to the Transferor have been
duly obtained, effected or given and are in full force and effect;
(3) on the Initial Cut-Off Date and the Initial Closing Date, each Initial
Account is an Eligible Account or in the case of an Additional
Account, on the applicable Additional Cut-Off Date and Addition Date,
each Account or Additional Account is an Eligible Account;
(4) On the Initial Closing Date, in the case of the Initial Accounts, and,
in the case of the Additional Accounts, on the applicable Additional
Cut-Off Date, and on each Transfer Date, each Receivable conveyed to
the Transferor on such date is an Eligible Receivable, subject to
certain exceptions provided in the Receivables Sale Agreement; and,
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(5) Each Participation Agreement, if any, relating to Receivables conveyed
by World Omni permits the transfer of such Receivables to the
Transferor and the Trust and provides that the undivided interest of
such participant is pari passu with the remaining undivided interest
in the related Receivables.
In the event of a breach of representation in the preceding paragraph
results in a Disqualified Receivable and the requirement that the Transferor
accept retransfer of that Disqualified Receivable pursuant to the Trust Sale and
Servicing Agreement, then World Omni will repurchase that Disqualified
Receivable from the Transferor on the date of the retransfer. The purchase price
for the Disqualified Receivables will be the face amount of the Disqualified
Receivable, of which at least the amount of any cash deposit required to be made
by the Transferor under the Trust Sale and Servicing Agreement for the
retransfer of the Disqualified Receivables will be paid in cash.
World Omni also represents to the Transferor that as of the Initial Closing
Date and each Series Issuance Date, as applicable,
(1) the execution and delivery of the Receivables Purchase Agreement, the
performance of the transactions contemplated therein and the
fulfillment of the terms thereof, will not conflict with, result in
any breach of any of the material terms and provisions of, or
constitute (with or without notice or lapse of time or both) a
material default under, any indenture, contract, agreement, mortgage,
deed of trust, or other instrument to which World Omni is a party or
by which it or its properties are bound,
(2) the execution and delivery of the Receivables Purchase Agreement, the
performance of the transactions contemplated by this Agreement and the
fulfillment of the terms hereof and thereof applicable to World Omni,
will not conflict with or violate any material requirements of law
applicable to World Omni,
(3) there are no proceedings or, to the best knowledge of World Omni,
investigations, pending or threatened against World Omni, before any
governmental authority with respect to certain matters, other than
those disclosed in the Receivables Purchase Agreement,
(4) all appraisals, authorizations, consents, orders, approvals or other
actions of any person or of any governmental body or official required
in connection with the execution and delivery of the Receivables
Purchase Agreement, the performance of the transactions contemplated
therein, and the fulfillment of the terms thereof, have been obtained,
(5) the Receivables Purchase Agreement constitutes a legal, valid and
binding obligation of World Omni,
(6) the schedule of various Accounts attached to the Receivables Purchase
Agreement is an accurate and complete listing in all material respects
of all Accounts as of specified dates, and
(7) the Receivables Purchase Agreement or, in the case of Additional
Accounts, the related assignment constitutes a valid sale, transfer
and assignment to the Transferor of all right, title and interest of
World Omni in the Receivables and the Collateral Security and the
proceeds thereof and, upon the taking of certain actions, the
Transferor shall have a first priority perfected ownership interest in
such property.
If the breach of any of the representations and warranties set forth above
results in the obligation of the Transferor to redeem the Notes pursuant to the
Trust Sale and Servicing Agreement and the Indenture, World Omni shall
repurchase the Receivables and the Collateral Security and pay to the Transferor
an amount of cash equal to the amount the Transferor is required to deposit into
the Principal Funding Account.
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COVENANTS OF WORLD OMNI. In the Receivables Purchase Agreement, World Omni
agrees to perform its obligations under the agreements relating to the
Receivables and the Accounts in conformity with its then-current policies and
procedures relating to the Receivables and the Accounts.
World Omni also agrees that, except for the transactions occurring pursuant
to the Transfer and Servicing Agreements (including the conveyance of
Participation Interests pursuant to any Participation Agreements), World Omni
will not sell, pledge, assign or transfer any interest in the Receivables to any
other person or grant, create, incur, assume or suffer to exist any lien on any
Receivable or Account, other than a Note or Certificate. In the event World Omni
is unable to transfer Receivables to the Transferor, World Omni also agrees to
allocate payments to the Accounts to the oldest Receivables and have such
payments applied as collections.
World Omni will pay the Servicer all collections received by World Omni in
respect of the Receivables promptly, but in no event later than two business
days after receipt by World Omni.
In addition, World Omni will notify certain parties after becoming aware of
any lien and will comply in all material respects with all requirements of law
applicable to it.
TERMINATION. The Receivables Purchase Agreement will terminate immediately
after the Trust terminates. In addition, if World Omni becomes party to any
bankruptcy or similar proceeding (other than as a claimant), World Omni will
immediately cease to sell or transfer Receivables to the Transferor and will
promptly give notice of that event to the Transferor, the Trust and the
Indenture Trustee. World Omni may, however, resume sales upon satisfying
specified conditions.
CONVEYANCE OF RECEIVABLES AND COLLATERAL SECURITY
On the Initial Closing Date, the Transferor will transfer and assign to the
Trust all of its right, title and interest in and to the Receivables and the
related Collateral Security as of the Initial Cut-Off Date, all Receivables
thereafter created in the Accounts and its interests in the related Collateral
Security and the Receivables Purchase Agreement, and the proceeds of all of the
foregoing.
The Transferor is required to provide to the Trust and to the Indenture
Trustee a true and complete list showing for each Account, as of the Initial
Cut-Off Date or the applicable Additional Cut-Off Date,
o its account number, and
o the aggregate amount of Principal Receivables in the Account.
'ADDITION DATE' means, for an Additional Account, the date from and after
which Additional Accounts are to be included as Accounts pursuant to the Trust
Sale and Servicing Agreement.
'ADDITIONAL CUT-OFF DATE' means, for an Additional Account, the date
specified in the notice of addition delivered with respect to such Additional
Account.
'REPRESENTATION DATE' means:
(1) for each Account, each Series Cut-Off Date and Series Issuance Date,
(2) for each Additional Account, the applicable Additional Cut-Off Date
and Addition Date.
(3) for each Receivable in an Account, each Series Cut-Off Date and the
Transfer Date for the Receivable, and
(4) for each Receivable in an Additional Account, the applicable Transfer
Date.
'SERIES CUT-OFF DATE' means, for a series of Notes, the date designated as
the Series Cut- Off Date in the related prospectus supplement.
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'SERIES ISSUANCE DATE' means, with respect to any series, the date on which
the Notes of such series are to be originally issued in accordance with the
Indenture and the applicable Series Supplement.
'TRANSFER DATE' means, for a Receivable arising after the Initial Cut-Off
Date, the date on which the Receivable is originated, unless the Receivable
arose in an Additional Account prior to the applicable Addition Date, in which
case 'Transfer Date' means the Addition Date.
REPRESENTATIONS AND WARRANTIES BY THE TRANSFEROR
The Transferor represents to the Trust relating to the Accounts, the
Receivables and the Collateral Security that:
(1) for each Account, including each Additional Account, as of each of the
applicable Representation Dates, the Account or Additional Account was
an Eligible Account,
(2) for each Receivable in an Account, including each Receivable in an
Additional Account, the Receivable is an Eligible Receivable or, if
the Receivable is not an Eligible Receivable, the Receivable is
conveyed to the Trust as described below under '--Ineligible
Receivables and Excess Receivables,'
(3) each Receivable and all Collateral Security conveyed to the Trust on
the Transfer Date, and all of the Transferor's right, title and
interest in the Receivables Purchase Agreement, have been conveyed to
the Trust free and clear of any liens, and
(4) all appropriate consents and governmental authorizations required to
be obtained by the Transferor in connection with the conveyance of
each Receivable or Collateral Security have been duly obtained.
If the Transferor breaches any representation described in the preceding
paragraph and the breach remains uncured for 30 days or such longer period as
may be agreed to by the Indenture Trustee, after the earlier to occur of the
discovery of the breach by the Transferor or the Servicer or receipt of written
notice of the breach by the Transferor or the Servicer, and the breach has a
materially adverse effect on the interest of the Noteholders in the Receivable
or, in the case of a breach relating to an Account, all Receivables in the
related Account ('DISQUALIFIED RECEIVABLES') will be reassigned to the
Transferor on the terms and conditions set forth below and the Account shall no
longer be included as an Account.
Each such Disqualified Receivable shall be reassigned to the Transferor on
or before the end of the Collection Period in which the reassignment obligation
arises. The Transferor shall direct the Servicer to deduct the principal balance
of such Disqualified Receivable from the Pool Balance. In the event that the
deduction would cause the Pool Balance to be less than the Required Pool
Balance, on the date on which the reassignment is to occur the Transferor will
be obligated to make a deposit into the Collection Account in immediately
available funds in an amount equal to the amount by which the Pool Balance would
be less than the Required Pool Balance (the amount of the deposit being referred
to herein as a 'TRANSFER DEPOSIT AMOUNT'), provided that if the Transfer Deposit
Amount is not so deposited, the principal balance of the related Receivables
will be deducted from the Pool Balance only to the extent the Pool Balance is
not reduced below the Required Pool Balance and any principal balance not so
deducted will not be reassigned and will remain part of the Trust. Upon
reassignment of any such Receivable, but only after payment by the Transferor of
the Transferor Deposit Amount, if any, the Trust shall automatically transfer,
without recourse, representation or warranty, all of the right, title and
interest of the Trust in and to such Receivable, all Collateral Security and all
monies due or to become due with respect thereto and all proceeds thereof. The
reassignment of the Receivable to the Transferor and the payment of any related
Transfer Deposit Amount will be the sole remedy for any breach of the
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representations and warranties described in the preceding paragraph with respect
to the Receivable available to Noteholders or the Indenture Trustee on behalf of
Noteholders.
The Transferor will also represent to the Trust, among other
representations, that as of each Series Issuance Date:
(a) it is duly organized and in good standing, it has the authority to
consummate the transactions contemplated by the Trust Sale and
Servicing Agreement and the Trust Sale and Servicing Agreement
constitutes a valid, binding and enforceable agreement of the
Transferor, and
(b) the Trust Sale and Servicing Agreement or, in the case of Additional
Accounts, the related assignment constitutes a valid sale, transfer
and assignment to the Trust of all right, title and interest of the
Transferor in the Receivables and the Collateral Security and the
proceeds thereof and, upon the taking of certain actions, the
Transferor shall have a first priority perfected ownership interest in
such property (other than certain liens in favor of World Omni
contemplated by the intercreditor provisions of the Receivables
Purchase Agreement).
In the event that the breach of any representation made by the Transferor
has a materially adverse effect on the Noteholders, and the holders of Notes
evidencing not less than a majority of the aggregate unpaid principal amount of
Notes, by written notice to the Transferor and the Servicer (and to the
Indenture Trustee and the issuer or provider of any Enhancement (an 'ENHANCEMENT
PROVIDER') have exercised their right to have the Notes redeemed pursuant to the
Indenture, the Transferor shall deposit in the Principal Funding Account an
amount equal to the sum of the amounts specified therefor with respect to each
outstanding series in the related Series Supplement. The obligation of the
Transferor to make the deposit into the Principal Funding Account will
constitute the sole remedy respecting a breach of the representations and
warranties available to Noteholders or the Indenture Trustee on behalf of the
Noteholders.
ELIGIBLE ACCOUNTS AND ELIGIBLE RECEIVABLES
An 'ELIGIBLE ACCOUNT' is defined to mean each individual wholesale
financing revolving line of credit extended by World Omni to a Dealer pursuant
to a dealer financing agreement or asset based lending financing agreement or
which has been acquired by World Omni, which line of credit, as of the date of
determination thereof:
(1) is established or acquired by World Omni in the ordinary course of
business pursuant to a dealer financing agreement or asset based
lending financing agreement,
(2) is in favor of a Dealer which is an eligible dealer (which excludes
dealers subject to voluntary or involuntary bankruptcy proceedings or
voluntary or involuntary liquidation),
(3) is in existence and maintained and serviced by World Omni (or a
successor Servicer) or relates to Non-Serviced Participation
Receivables for which the Rating Agency Condition has been satisfied,
and
(4) in respect of which no amounts have been charged off as uncollectible
or are classified as past due or delinquent.
An 'ELIGIBLE RECEIVABLE' is defined to mean each Receivable:
(1) which was originated or acquired by World Omni in the ordinary course
of business,
(2) which arose under an Account that at the time was an Eligible Account,
(3) which is owned by World Omni at the time of sale by World Omni to the
Transferor,
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(4) which represents the obligation of a Dealer to repay an advance made
to or on behalf of the Dealer (i) to finance the acquisition of
Vehicles or (ii) in connection with the asset based lending business,
(5) which, at the time of creation and at the time of transfer to the
Trust, except at the Initial Closing Date for Receivables relating to
Vehicles that have already been sold, is secured by a perfected first
priority security interest in the Vehicles or assets relating thereto,
(6) which was created in compliance in all respects with all requirements
of law applicable thereto and pursuant to a dealer financing agreement
or asset based lending financing agreement which complies in all
respects with all requirements of law applicable to any party thereto,
(7) with respect to which all material consents and governmental
authorizations required to be obtained by World Omni or the Transferor
in connection with the creation of the Receivable or the transfer
thereof to the Trust or the performance by World Omni of the dealer
financing agreement or asset based lending financing agreement
pursuant to which the Receivable was created, have been duly obtained,
(8) as to which at all times following the transfer of the Receivable to
the Trust, the Trust will have good and marketable title thereto free
and clear of all liens arising prior to the transfer or arising at any
time, other than liens permitted pursuant to the Trust Sale and
Servicing Agreement,
(9) which has been the subject of a valid transfer and assignment from the
Transferor to the Trust of all the Transferor's right, title and
interest therein (including any proceeds thereof),
(10) which will at all times be the legal, valid, binding and assignable
payment obligation of the Dealer relating thereto, enforceable against
the Dealer in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy or other similar laws,
(11) which at the time of transfer to the Trust is not subject to any right
of rescission, setoff, counterclaim or any other defense (including
defenses arising out of violations of usury laws) of the Dealer,
(12) as to which, at the time of transfer of the Receivable to the Trust,
World Omni and the Transferor have satisfied all their respective
obligations relating to that Receivable required to be satisfied at
that time,
(13) as to which, at the time of transfer of the Receivable to the Trust,
neither World Omni nor the Transferor has taken or failed to take any
action which would impair the rights of the Trust, the
Certificateholders or the Noteholders therein,
(14) which constitutes an 'instrument,' 'account,' 'chattel paper' or a
'general intangible' as defined in Article 9 of the Uniform Commercial
Code as then in effect in the State of Florida,
(15) which was transferred to the Trust with all applicable governmental
authorization, and
(16) which is payable in U.S. dollars.
It is not required or anticipated that the Trust or the Indenture Trustee
will make any initial or periodic general examination of the Receivables or any
records relating to the Receivables for the purpose of establishing the presence
or absence of defects, compliance with representations and warranties of the
Transferor or for any other purpose. In addition, it is not anticipated or
required that the Trust or the Indenture Trustee will make any initial or
periodic general examination of the Servicer for the purpose of establishing the
compliance by the Servicer with its representations or warranties, the
observation of its obligations under the Trust Sale and Servicing Agreement or
for any other purpose.
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INELIGIBLE RECEIVABLES AND EXCESS RECEIVABLES
For the purpose of facilitating the administration and reporting
requirements of the Servicer under the Trust Sale and Servicing Agreement, all
Receivables that are not Eligible Receivables ('INELIGIBLE RECEIVABLES') arising
in an Eligible Account shall be transferred to the Trust, provided that, if the
Series Supplement for a series of Notes so provides, the Incremental
Subordinated Amount, as defined in the related prospectus supplement, for that
series will be adjusted by the portion of the aggregate principal amount of
Ineligible Receivables included therein allocable to the Noteholders' Interest
of that series. The Incremental Subordinated Amount also will be increased by
the portion of the aggregate principal amount allocable to the Noteholders'
Interest of all Receivables arising in Eligible Accounts which are no longer
Eligible Accounts. See 'The Notes--Allocation of Collections; Deposits in
Collection Account' and '--Limited Subordination of Transferor Interest;
Enhancements--Subordination of Transferor's Interest.'
In addition, the Trust Incremental Subordinated Amount will be adjusted on
each Determination Date to reflect the amount of Principal Receivables on that
Determination Date that are (a) Excess Receivables, (b) in excess of the
concentration limits with respect to Dealer concentrations, manufacturer
concentrations, asset based receivable concentrations and mega-Dealer group
manufacturer concentrations (the 'OVERCONCENTRATION AMOUNT') and (c) Ineligible
Receivables included in the Trust on the last day of the preceding Collection
Period.
'EXCESS RECEIVABLES' means, on any Determination Date, an aggregate amount
equal to the sum, without duplication, of:
(1) the aggregate amount by which Principal Receivables relating to used
Vehicles exceeds 25% of the aggregate amount of the Principal
Receivables included in the Trust, calculated as of the last day of
the preceding Collection Period,
(2) the aggregate amount of Principal Receivables as of the last day of
the preceding Collection Period in Eligible Accounts that are on
'finance hold' by World Omni as of the last day of such preceding
Collection Period, and
(3) the aggregate amount by which Principal Receivables arising in
Eligible Accounts under World Omni's 'Delayed Payment Privilege
Program' exceeds 2% of the aggregate amount of Principal Receivables
included in the Trust as of the last day of the preceding Collection
Period,
These percentages and dollar limits may be increased periodically subject to
each Rating Agency confirming that the increase will not result in a downgrade
or withdrawal of its ratings assigned to the Notes.
'TRUST INCREMENTAL SUBORDINATED AMOUNT' means, on any Determination Date,
the sum of (a) the Overconcentration Amount, (b) the amount of Excess
Receivables and (c) the amount of Ineligible Receivables included in the Trust
on the last day of the preceding Collection Period (the 'INELIGIBLE AMOUNT'), in
each case as of the Determination Date.
ADDITION OF ACCOUNTS
Subject to the conditions described below, the Transferor has the right to
designate additional accounts to be included as Accounts (the 'ADDITIONAL
ACCOUNTS'). In addition, if, as of the close of business on the last day of any
Collection Period, the Pool Balance on such day is less than the Required Pool
Balance as of the following Payment Date (after giving effect to the
allocations, distributions, withdrawals and deposits to be made on that Payment
Date), the Transferor shall, within five business days following the end of such
Collection Period, designate and transfer to the Trust the
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Receivables (and the Collateral Security) of Additional Accounts of the
Transferor to be included as Accounts in a sufficient amount such that after
giving effect to such addition, the Pool Balance as of the close of business on
the Addition Date is at least equal to such Required Pool Balance. The failure
of the Transferor to transfer Receivables to the Trust as required in the prior
sentence solely as a result of the unavailability of a sufficient amount of
Eligible Receivables will not constitute a breach of the Trust Sale and
Servicing Agreement; provided, however, that such failure will result in the
occurrence of an Early Amortization Event.
Any designation of Additional Accounts is subject to the following
conditions, among others:
(1) the Transferor shall have given timely notice of the addition of such
Additional Accounts to the Owner Trustee, the Indenture Trustee, any
agent, the Rating Agencies and any Enhancement Providers;
(2) each Additional Account must be an Eligible Account;
(3) the Transferor shall have delivered to the Owner Trustee a duly
executed written assignment and to the Owner Trustee and the Indenture
Trustee the computer file or microfiche or written list required to be
delivered pursuant to the Trust Sale and Servicing Agreement;
(4) the addition of the Receivables arising in such Additional Accounts
shall not result in the occurrence of an Early Amortization Event or
Investment Event;
(5) the Transferor shall not use selection procedures in selecting
Additional Accounts that it reasonably believes is adverse to the
interests of the Noteholders or any Enhancement Provider;
(6) the Transferor shall deliver the required opinions of counsel relating
to the addition of the Additional Accounts to the Owner Trustee, the
Indenture Trustee, the Rating Agencies and any Enhancement Provider;
(7) the applicable Rating Agencies shall have provided written
confirmation that the addition will not result in a reduction or
withdrawal of the rating of any outstanding series or class of Notes;
and
(8) the Transferor shall have, to the extent required, deposited all
Collections with respect to Additional Accounts since the Additional
Cut-Off Date in the Collection Account.
Notwithstanding the foregoing, the Transferor may, at its sole discretion,
and subject only to the limitations specified in this paragraph, voluntarily
designate Additional Accounts (other than those that contain Purchased
Participation Receivables) to be included as Accounts and transfer to the Trust
the Receivables and the Collateral Security of such Additional Accounts.
(Additional Accounts designated in accordance with the provisions described in
this paragraph are referred to herein as 'AUTOMATIC ADDITIONAL ACCOUNTS'.)
Unless each Rating Agency otherwise consents, the number of Automatic Additional
Accounts designated for any calendar quarter shall not exceed 15% of the number
of Accounts as of the first day of the calendar quarter, nor shall the number of
Automatic Additional Accounts designated during any calendar year exceed 20% of
the number of Accounts as of the first day of such calendar year. Within 30 days
after the end of any calendar quarter, or such other period as shall be required
by the Rating Agencies, in which Accounts are designated as Automatic Additional
Accounts, the Transferor will deliver to the Owner Trustee and the Indenture
Trustee and each Rating Agency an opinion of counsel with respect to any
Automatic Additional Accounts included as Accounts in such quarter, confirming
the validity and perfection of the transfer of such Automatic Additional
Accounts. If such opinion is not delivered, the ability of the Transferor to
designate Automatic Additional Accounts will be suspended until such time as
each Rating Agency otherwise consents in
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writing. If the Transferor is unable to deliver an opinion of counsel with
respect to any Automatic Additional Account, such inability will be a breach of
the representation and warranty with respect to the Receivables in such
Automatic Additional Account.
Each Additional Account (including each Automatic Additional Account) must
be an Eligible Account at the time of its addition. However, since Additional
Accounts may not have been a part of the initial portfolio of World Omni, the
Additional Accounts may not be of the same credit quality as the initial
Accounts. Additional Accounts may have been originated by World Omni at a later
date using credit criteria different from those which were applied to the
initial Accounts or may have been acquired by World Omni from another wholesale
lender that had different credit criteria. In addition, the Transferor will be
permitted to designate as Additional Accounts any Accounts which contain
receivables that have been sold or pledged to third parties; however, following
the applicable Additional Cut-Off Date, no Receivables thereafter arising in any
such accounts shall be sold or pledged to any third parties.
REMOVAL OF ACCOUNTS; TRANSFERS OF PARTICIPATIONS
The Transferor shall have the right at any time to remove Eligible Accounts
from the Trust. To remove any Eligible Account, the Transferor (or the Servicer
on its behalf) shall, among other things:
(a) not less than five business days prior to the Removal Commencement
Date, furnish to the Owner Trustee, Indenture Trustee, any agent, any
Enhancement Provider and the Rating Agencies a written notice (the
'REMOVAL NOTICE') specifying the Determination Date on which removal
of one or more Accounts will commence (a 'REMOVAL COMMENCEMENT DATE')
and the Accounts to be removed from the Trust (the 'DESIGNATED
ACCOUNTS'),
(b) determine on the Removal Commencement Date the aggregate principal
balance of Receivables in respect of each Designated Account (the
'DESIGNATED BALANCE') and deliver to the Trust on the Removal
Commencement Date a computer file or microfiche or written list
containing a true and complete list of the Removed Accounts specifying
for each such Account its account number and the aggregate amount of
Receivables outstanding in such Account,
(c) from and after the Removal Commencement Date, cease to transfer to the
Trust any and all Receivables arising in the Designated Accounts,
(d) from and after the Removal Commencement Date, allocate all Principal
Collections in respect of each Designated Account, first to the oldest
outstanding principal balance of the Designated Account, until the
Determination Date on which the Designated Balance in the Designated
Account is reduced to zero (the 'REMOVAL DATE'),
(e) on each business day from and after the Removal Commencement Date to
and until the related Removal Date, allocate:
(1) to the Trust (to be further allocated pursuant to the Trust Sale
and Servicing Agreement), Non-Principal Collections in respect of
each Designated Account for Receivables in all Designated
Accounts transferred to the Trust, and
(2) to the Transferor the remainder of the Non-Principal Collections
in the Designated Accounts,
(f) represent and warrant that the removal of the Eligible Account on any
Removal Date shall not, in the reasonable belief of the Transferor,
cause an Early Amortization Event or Investment Event to occur for any
series of Notes,
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(g) represent and warrant that no selection procedures believed by the
Transferor to be adverse to the interests of the Noteholders were
utilized in selecting the Designated Accounts,
(h) represent and warrant that the removal will not result in a reduction
or withdrawal of the rating of any outstanding series or class of
Notes by any applicable Rating Agency, and
(i) on or before the related Removal Date, deliver to the Indenture
Trustee and any Enhancement Provider an officers' certificate
confirming the items set forth in clauses (f), (g) and (h) above and
confirming that the Transferor reasonably believes that the removal of
the Removed Accounts will not result in the occurrence of an Early
Amortization Event or Investment Event.
No Designated Accounts shall be removed if the removal will result in a
reduction or withdrawal of the rating of any outstanding series or class of
Notes by any applicable Rating Agency.
On the fifth business day after any date on which an Account becomes an
Ineligible Account (which fifth business day will be deemed the Removal
Commencement Date for the Account), the Transferor will commence the removal of
the Receivable of such Ineligible Account from the Trust by taking each of the
actions specified above for the removal of Eligible Accounts.
Upon satisfaction of the above conditions, on the Removal Date for the
Designated Account, the Transferor will cease the allocation of collections of
Receivables from the Designated Account and the Designated Account shall be
deemed removed from the Trust for all purposes (a 'REMOVED ACCOUNT').
In addition to the removal rights described above, the Transferor shall
have the right at any time to remove certain Ineligible Accounts from the Trust
and, in connection therewith, repurchase the then existing Receivables in the
Accounts. To remove Accounts and repurchase the then existing Receivables in the
Ineligible Accounts, the Transferor (or the Servicer on its behalf) shall, among
other things:
(1) not less than five business days prior to the Removal and Repurchase
Date, furnish to the Trust and the Owner Trustee, the Indenture
Trustee, any agent, each Enhancement Provider and the Rating Agencies
a Removal Notice specifying the Designated Accounts which are to be
removed, and the then existing Receivables in the Designated Accounts
(the 'DESIGNATED RECEIVABLES') which are to be repurchased from the
Trust and the Determination Date (which may be the Determination Date
on which such notice is given) on which the removal of the Designated
Accounts and the purchase of the Designated Receivables will occur (a
'REMOVAL AND REPURCHASE DATE'),
(2) deliver to the Trust on the Removal and Repurchase Date a computer
file or microfiche or written list containing a true and complete list
of the Removed Accounts specifying for each such Account its account
number and the aggregate amount of Receivables outstanding in such
Account,
(3) deposit into the Collection Account on the Removal and Repurchase Date
funds in an amount equal to the aggregate outstanding balance of the
Designated Receivables on such date (the 'REPURCHASED RECEIVABLES
PURCHASE PRICE') which funds will be treated as collections,
(4) represent and warrant that the removal of any such Ineligible Account
and the repurchase of the Receivables then existing in such Account on
any Removal and Repurchase Date shall not, in the reasonable belief of
the Transferor, cause an Early Amortization Event or Investment Event
to occur for any series of Notes or cause the Pool Balance to be less
than the Required Pool Balance,
(5) represent and warrant that no selection procedures believed by the
Transferor to be adverse to the interests of the Noteholders were
utilized in selecting the Designated Accounts,
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(6) represent and warrant as of the Removal and Repurchase Date that the
list of Removed Accounts delivered pursuant to clause (2) above, as of
the Removal and Repurchase Date, is true and complete in all material
respects,
(7) represent and warrant that such removal and repurchase will not result
in a reduction or withdrawal of the rating of any outstanding series
or class of Notes by the applicable Rating Agencies, and
(8) deliver to the Trust, the Indenture Trustee and any Enhancement
Providers an officers' certificate confirming the items set forth in
clauses (4) through (7) above and confirming that the Transferor
reasonably believes that the removal of the Removed Accounts and the
repurchase of the Repurchased Receivables will not result in the
occurrence of an Early Amortization Event or Investment Event.
Upon satisfaction of the above conditions, on the Removal and Repurchase
Date for any such Designated Account and Designated Receivables, such Designated
Account shall be deemed removed, and such Designated Receivables ('REPURCHASED
RECEIVABLES') shall be deemed repurchased, from the Trust for all purposes.
On each Payment Date, any amounts on deposit in the Collection Account on
such Payment Date resulting from payment by the Transferor of the Repurchased
Receivables Purchase Price will be treated as Collections.
In addition to the foregoing provisions, the Transferor shall have the
right to remove Ineligible Accounts and reassign the then existing Receivables
in the Accounts ('AUTOMATIC REMOVED ACCOUNTS'), upon satisfaction by the
Transferor (or the Servicer on its behalf) of the following conditions:
(a) on or before the fifth business day immediately preceding the
Automatic Removal Date, the Transferor shall furnish to the Owner
Trustee, the Indenture Trustee, any agent, any Enhancement Providers
and the Rating Agencies a Removal Notice specifying the Automatic
Removed Accounts which are to be reassigned from the Trust to the
Transferor and the date on which such removal of Automatic Removed
Accounts and reassignment of such Receivables is to occur (the
'AUTOMATIC REMOVAL DATE');
(b) on or prior to the date that is five business days after the Automatic
Removal Date, the Transferor shall deliver to the Trust and the
Indenture Trustee a computer file or microfiche or written list
containing a true and complete list of the Automatic Removed Accounts
specifying for each such Account, as of the removal notice date, its
account number and the aggregate amount of Receivables outstanding in
such Account;
(c) the Transferor shall represent and warrant as of each Automatic
Removal Date that the list of Automatic Removed Accounts delivered
pursuant to clause (b) above, as of the Automatic Removal Date, is
true and complete in all material respects; and
(d) if any of the Accounts to be removed is not liquidated and does not
have a zero balance:
(1) the Transferor shall deliver to the Indenture Trustee
confirmation from each Rating Agency that such removal will not
result in a reduction or withdrawal of such Ratings Agency's
rating of any outstanding series or class of Notes; and
(2) the Transferor shall deliver to the Owner Trustee, the Indenture
Trustee, any agent, and any Enhancement Providers an officers'
certificate, dated the Automatic Removal Date, to the effect that
the Transferor reasonably believes that such removal will not
cause an Early Amortization Event or Investment Event to occur
for any series of Notes.
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Upon satisfaction of the above conditions, on the Automatic Removal Date
all the right, title and interest of the Trust in and to the Receivables arising
in the Automatic Removed Accounts, all monies due and to become due and all
amounts received with respect thereto and all proceeds thereof shall be deemed
removed from the Trust for all purposes.
THE CERTIFICATES
The Transfer and Servicing Agreements provide that the Transferor may
exchange a portion of the certificate evidencing its interest in the Trust (the
'TRANSFEROR CERTIFICATE') for one or more additional certificates (each a
'SUPPLEMENTAL CERTIFICATE') for transfer or assignment to a person designated by
the Transferor upon the execution and delivery of a supplement to the Trust
Agreement (which supplement shall be subject to the amendment section of the
Trust Agreement to the extent that it amends any of the terms of the Trust
Agreement); provided that:
(a) the Transferor shall have delivered to the Owner Trustee, the
Indenture Trustee, the Rating Agencies and any Enhancement Provider a
Tax Opinion dated as of the date of such exchange (or transfer and
exchange), and
(b) the Transferor shall have given the Rating Agencies notice five days
prior to such exchange (or transfer and exchange) and has delivered to
the Owner Trustee and the Indenture Trustee written confirmation from
the applicable Rating Agencies that such exchange will not result in a
reduction or withdrawal of the rating of any outstanding series or
class of Notes.
Any subsequent transfer or assignment of a Supplemental Certificate is also
subject to the conditions described in clauses (a) and (b) in the preceding
sentence.
DEFAULTED RECEIVABLES AND RECOVERIES
'DEFAULTED RECEIVABLES' on any Determination Date are:
(1) all Receivables which were charged off as uncollectible in respect of
the immediately preceding Collection Period in accordance with the
Servicer's customary and usual servicing procedures for servicing
Dealer floorplan receivables comparable to the Receivables which have
not been sold to third parties and
(2) all Receivables which were Eligible Receivables when transferred to
the Trust on the Initial Closing Date or the related Additional Date
or on their respective Transfer Date, which arose in an Account which
became an Ineligible Account after the date of transfer of such
Receivables to the Trust and which remained outstanding for any six
consecutive Determination Dates (including the Determination Date on
which such determination is being made) after such Account became an
Ineligible Account.
The 'DEFAULTED AMOUNT' for any Collection Period will be an amount equal to
the excess, if any, of:
(a) the principal amount of Receivables that became Defaulted Receivables
during the preceding Collection Period
over
(b) the sum of:
(1) the full amount of any Defaulted Receivables subject to
reassignment to the Transferor or purchase by the Servicer for
such Collection Period unless specified events of bankruptcy,
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insolvency or receivership have occurred for either of the
Transferor or the Servicer, in which event the Defaulted Amount
will not be reduced for those Defaulted Receivables
and
(2) the excess, if any, of the amount determined pursuant to clause
(b)(1) over the amount determined pursuant to clause (a).
If the Servicer adjusts downward the amount of any Principal Receivable
because of a rebate, refund, credit adjustment or billing error to a Dealer, or
because such Receivable was created in respect of inventory which was refused or
returned by a Dealer, then, in any such case, the Pool Balance will
automatically be reduced by the amount of the adjustment. Furthermore, if
following such a reduction, the Pool Balance would be less than the Minimum
Required Pool Balance on such day, then the Transferor shall be required to pay
an amount equal to such deficiency (up to the amount of such adjustment) into
the Collection Account within five business days after the day on which such
adjustment or reduction occurs (each such payment, an 'ADJUSTMENT PAYMENT').
The 'MINIMUM REQUIRED POOL BALANCE' for any day equals the Required Pool
Balance that would result if the Required Pool Balance was calculated as if the
Required Participation Percentage for each series of notes (as specified in the
related prospectus supplement) was 100%.
If the Servicer adjusts downward the amount of interest otherwise payable
on any Receivable with respect to any Collection Period as a result of any
interest rebate program, the Servicer shall deposit into the Collection Account
on or prior to the Payment Date related to such Collection Period an amount
equal to the amount of such rebate (such payment, a 'REBATE PAYMENT').
OPTIONAL REPURCHASE
If so provided in a prospectus supplement relating to a series of Notes, on
any Payment Date occurring after the Invested Amount of the Notes of such series
is reduced to the percentage of the initial outstanding principal amount of the
Notes of such series specified therein, the Transferor will have the option,
subject to specified conditions, to repurchase the Noteholders' Interest of such
series. The purchase price will generally be equal to:
(1) the Invested Amount of such series on the Determination Date preceding
the Payment Date on which such repurchase will be made,
plus
(2) accrued and unpaid interest on the unpaid principal amount of the
Notes of such series at the applicable interest rate (together with
interest on overdue interest),
plus
(3) any other amounts specified in the related Series Supplement.
The purchase price will be deposited in the Collection Account in immediately
available funds on the Payment Date on which the Transferor exercises such
option. Following any such purchase, the Noteholders of such series will have no
further rights in the Noteholders' Interest of such series, other than the right
to receive the final distribution on the Notes of that series. In the event that
the Transferor fails for any reason to deposit such purchase price, payments
will continue to be made to the Noteholders of such series as described in the
related prospectus supplement.
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INVESTMENT EVENTS AND EARLY AMORTIZATION EVENTS
An 'INVESTMENT EVENT' refers to, for any series of Notes, any of the events
so defined in the Series Supplement relating to that series and described in the
related prospectus supplement. Upon the occurrence of any event so defined, an
Investment Event will be deemed to have occurred for such series without any
notice or other action on the part of any other party immediately upon the
occurrence of such event. The Investment Period for such series will commence as
of the close of business on the business day immediately preceding the day on
which the Investment Event is deemed to have occurred.
An 'EARLY AMORTIZATION EVENT' refers to, for any series of Notes, any of
the events so defined in the Series Supplement relating to the series and
described in the related prospectus supplement, as well as the following events:
(1) a failure by the Transferor to convey Receivables in Additional
Accounts to the Trust within 15 business days after the day on which
it is required to convey such Accounts;
(2) the occurrence of specified events of bankruptcy, insolvency or
receivership relating to the Transferor or the Servicer;
(3) the occurrence of specified events of bankruptcy, insolvency or
receivership relating to World Omni or Toyota; and
(4) the Trust or the Transferor becomes an investment company within the
meaning of the Investment Company Act of 1940.
Immediately upon the occurrence of any event described above or in the
related Series Supplement and prospectus supplement for a series of Notes,
subject to applicable law, and after the applicable grace period, if any, an
Early Amortization Event shall occur for such series without any notice or other
action on the part of any other party, as set forth in the Series Supplement and
solely with respect to the affected series. The Early Amortization Period for
such series will commence as of the close of business on the business day
immediately preceding the day on which the Early Amortization Event is deemed to
have occurred.
Notwithstanding the commencement of an Investment Period or an Early
Amortization Period for a series of Notes, such period may terminate and the
Revolving Period for such series and any class thereof may commence when the
event giving rise to the commencement of such Investment Period or Early
Amortization Period no longer exists, whether as a result of the distribution of
principal to Noteholders of such series or otherwise, in each case if and to the
extent provided in the Series Supplement for such series.
In addition to the consequences of an Investment Event or an Early
Amortization Event for any series of Notes discussed above, if the Transferor
violates its covenant not to create any lien on any Receivable as provided in
the Trust Sale and Servicing Agreement, on the day of such violation, the
Transferor will (subject to the actions of the Noteholders) immediately cease to
transfer Receivables to the Trust and promptly give notice to the Indenture
Trustee of such violation, as applicable. Under the terms of the Trust Sale and
Servicing Agreement, within 15 days the Indenture Trustee will publish a notice
of such violation stating that the Indenture Trustee intends to sell, liquidate
or otherwise dispose of the Receivables in a commercially reasonable manner and
on commercially reasonable terms, unless within a specified period of time
holders of Notes of each outstanding series representing more than 50% of the
aggregate unpaid principal amount of the Notes of each such series (or, for any
series with two or more classes, the Notes of each such class) and each person
holding a Supplemental Certificate, instruct the Indenture Trustee not to sell,
dispose of or otherwise liquidate the Receivables and to continue transferring
Receivables as before such insolvency event or violation, as applicable. If the
portion of such proceeds allocated to the Notes and the proceeds of any
collections on the Receivables
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in the Collection Account allocable to the Notes are not sufficient to pay the
aggregate unpaid principal balance of the Notes in full plus accrued and unpaid
interest thereon, Noteholders will incur a loss.
TERMINATION; FULLY FUNDED DATE
TERMINATION. The Indenture will terminate on the earlier to occur of:
(a) the day following the Payment Date on which the aggregate Invested
Amounts for all series of Notes is zero, and
(b) the date on which proceeds from the sale, disposal or other
liquidation of the Receivables are distributed to the Noteholders
following any violation by the Transferor of its covenant not to
create any lien on any Receivable as provided in the Trust Sale and
Servicing Agreement and as described above under 'The
Notes--Investment Events and Early Amortization Events.'
Upon termination of the Indenture, all right, title and interest in the
Receivables and other funds of the Trust (other than amounts in the Collection
Account, any Principal Funding Account, Interest Funding Account or other
account for the final distribution of principal and interest to Noteholders)
will be conveyed and transferred to the Trust.
In any event, the last payment of principal and interest on any series of
Notes will be due and payable no later than the date specified in the related
prospectus supplement (the 'SERIES TERMINATION DATE').
FULLY FUNDED DATE. Following the occurrence of the Fully Funded Date for
any series of Notes, Noteholders of that series will no longer have any interest
in the Receivables and all the representations and covenants of the Transferor
and the Servicer relating to the Receivables, as well as other specified
provisions of the Indenture and all remedies for breaches thereof, will no
longer accrue to the benefit of the Noteholders of that series, in each case,
unless the Revolving Period for such series recommences as provided in the
related Series Supplement. Those representations, covenants and other provisions
include the conditions to the exchange of the Transferor Certificate described
under 'The Transfer and Servicing Agreements--The Certificates,' the conditions
to the issuance of a new series of Notes described under 'The Notes--New
Issuances,' the representations described under 'The Transfer and Servicing
Agreements--Representations and Warranties by the Transferor' to the extent they
relate to the Receivables and the Collateral Security, the limitations on
additions and removals of Accounts described under 'The Transfer and Servicing
Agreements--Addition of Accounts' and '--Removal of Accounts,' respectively, and
the obligations of the Servicer to service the Receivables described under 'The
Transfer and Servicing Agreements-- Collection and Other Servicing Procedures'
and '--Servicer Covenants.' In addition, upon the occurrence of the Fully Funded
Date for any series of Notes, no Non-Principal Collections, Principal
Collections, Defaulted Receivables or Miscellaneous Payments will be allocated
to that series, unless the Revolving Period with respect thereto recommences as
described above. Notwithstanding the foregoing, when the final distribution has
been made for each series of Notes or the Fully Funded Date has occurred with
respect thereto, all right, title and interest in the Receivables will be
conveyed and transferred to the Transferor.
INDEMNIFICATION
The Trust Sale and Servicing Agreement provides that the Servicer will
indemnify the Trust for the benefit of the Certificateholders, the Noteholders,
any Enhancement Provider, the Owner Trustee and the Indenture Trustee from and
against any loss, liability, expense, damage or injury suffered or sustained
arising out of any acts, omissions or alleged acts or omissions arising out of
activities of the Servicer pursuant to the Trust Sale and Servicing Agreement,
the Indenture Trustee pursuant to the Indenture or the Related Documents or the
Owner Trustee pursuant to the Trust Agreement or the Related
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Documents; provided, however, the Servicer will not indemnify any party if such
acts, omissions or alleged acts or omissions arising out of the activities of
(a) the Servicer constitute fraud, gross negligence, breach of fiduciary duty or
willful misconduct by the Owner Trustee or the Indenture Trustee or (b) the
Indenture Trustee or the Owner Trustee is due to the willful misfeasance, bad
faith or negligence (except for errors in judgment) of the person seeking
indemnification. However, the Servicer will not indemnify the Trust for the
benefit of the Certificateholders, the Noteholders, any Enhancement Provider,
the Owner Trustee, the Indenture Trustee or the Noteholders for any act taken by
the Indenture Trustee at the request of the Noteholders or for any tax required
to be paid by such party arising out of (i) the sale of any Eligible Receivables
to the Trust, (ii) the issuance and original sale of any Notes or Certificates,
(iii) ownership or sale of any Eligible Receivables in the Accounts or the Notes
and Certificates, (iv) distributions or the receipt of payments on the Notes or
Certificates or (v) any fees or other compensation payable to such party.
The Trust Sale and Servicing Agreement provides that, except as described
above, and except for other specified exceptions, neither the Servicer nor any
of its directors, officers, employees or agents will be under any liability to
the Trust, the Owner Trustee, the Indenture Trustee, the Noteholders,
Enhancement Providers, any agent or any other person for taking any action, or
for refraining from taking any action, pursuant to the Trust Sale and Servicing
Agreement. However, neither the Servicer nor any of its directors, officers,
employees or agents will be protected against any liability which would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
of any such person in the performance of their duties or by reason of reckless
disregard of their obligations and duties thereunder.
In addition, the Trust Sale and Servicing Agreement provides that the
Servicer is not under any obligation to appear in, prosecute or defend any legal
action which is not incidental to its servicing responsibilities under the Trust
Sale and Servicing Agreement. The Servicer may, in its sole discretion,
undertake any such legal action which it may deem necessary or desirable for the
benefit of the Noteholders and the Certificateholders with respect to the Trust
Sale and Servicing Agreement and the rights and duties of the parties thereto
and the interest of the Certificateholders thereunder and the Noteholders under
the Indenture.
COLLECTION AND OTHER SERVICING PROCEDURES
Pursuant to the Trust Sale and Servicing Agreement, the Servicer is
responsible for servicing, collecting and administering the Receivables and
charging off as uncollectible Receivables in accordance with customary and usual
procedures for servicing its own wholesale receivables comparable to the
Receivables, except where the failure to act in accordance with such procedures
would not materially and adversely affect the rights of the Trust, the
Noteholders, the Certificateholders or any Enhancement Provider. In certain
circumstances, the Trust will contain Purchased Participation Receivables. A
portion of the Purchased Participation Receivables will not be serviced by the
Servicer (the 'NON-SERVICED PARTICIPATION RECEIVABLES') other than enforcing the
rights of the Issuer pursuant to the Participation Agreement that created the
Non-Serviced Participation Receivable in order to ensure that the Receivable is
properly serviced and that all amounts due to the Issuer under the Participation
Agreement are received. However, it is anticipated that the Servicer and each
Rating Agency, prior to issuing written confirmation that the inclusion of such
Non-Serviced Participation Receivable will not result in the reduction or
withdrawal of the rating of any Notes, will review the practices and policies of
the party servicing such Non-Serviced Participation Receivable.
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World Omni covenants that it may only change the terms and provisions
relating to the Accounts if, in the Servicer's reasonable judgment, no Early
Amortization Event or Investment Event will occur for any series of Notes as a
result of the change and none of the Certificateholders, Noteholders or
Enhancement Providers will be materially and adversely affected and the change
is made applicable to the comparable segment of the portfolio of wholesale
accounts with similar characteristics owned or serviced by World Omni and not
only to the Accounts; provided, however, that the Servicer may reduce the rate
of any finance charges if such reduction would not result in the weighted
average of the interest rates of the Receivables being less than the weighted
average of the sum of the interest rates of the Notes plus servicing fees.
Servicing activities to be performed by the Servicer include collecting and
recording payments, communicating with dealers, investigating payment
delinquencies, evaluating the increase of credit limits, and maintaining
internal records for each Account. Managerial and custodial services performed
by the Servicer on behalf of the Trust include providing assistance in any
inspections of the documents and records relating to the Accounts and
Receivables by the Trust and the Indenture Trustee pursuant to the Trust Sale
and Servicing Agreement and Indenture, maintaining the agreements, documents and
files relating to the Accounts and Receivables as custodian for the Trust and
providing related data processing and reporting services for Noteholders and on
behalf of the Trust and the Indenture Trustee.
SERVICER COVENANTS
In the Trust Sale and Servicing Agreement the Servicer covenants that:
(1) it will duly satisfy all obligations on its part to be fulfilled under
or in connection with the Receivables and the Accounts, will maintain
in effect all qualifications required in order to service the
Receivables and the Accounts and will comply in all material respects
with all requirements of law in connection with servicing the
Receivables and the Accounts, the failure to comply with which would
have a materially adverse effect on the Noteholders of any outstanding
series, the Certificateholders or any Enhancement Provider;
(2) it will not permit any rescission or cancellation of a Receivable
except as ordered by a court of competent jurisdiction or other
government authority;
(3) it will do nothing to impair the rights of the Noteholders or any
Enhancement Provider in the Receivables or the Accounts;
(4) it will not reschedule, revise or defer payments due on any Receivable
except in accordance with its guidelines for servicing dealer
wholesale financing revolving line of credit loans; and
(5) it will not sell, pledge, assign or transfer to any person or grant,
create, incur, assume or suffer to exist any lien on any Receivable
sold or assigned to the Trust other than as contemplated by the
Related Documents.
Under the terms of the Trust Sale and Servicing Agreement, if the
Transferor or the Servicer discovers, or receives written notice, that any
covenant of the Servicer set forth in clauses (3) or (4) above has not been
complied with in any material respect and such noncompliance has not been cured
within 30 days thereafter (or such longer period as the Owner Trustee may agree
to) and has a materially adverse effect on the value of such Receivable, World
Omni, as Servicer, will purchase such Receivable or all Receivables in such
Account, as applicable. Such purchase will be made on the Determination Date
following the expiration of the 30-day cure period and the Servicer will be
obligated to deposit into the Collection Account an amount equal to the amount
of such Receivable plus accrued and unpaid interest thereon. The amount of such
deposit shall be deemed a Transfer Deposit Amount. The purchase by the Servicer
constitutes the sole remedy available to the Noteholders if such covenant
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or warranty of the Servicer is not satisfied and the Trust's interest in any
such purchased Receivables shall be automatically assigned to the Servicer.
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
The Servicer's compensation for its servicing activities and reimbursement
for its expenses will be a monthly servicing fee (the 'SERVICING FEE') in an
amount payable in arrears on each Payment Date on or before the Trust
Termination Date equal to the sum of the Monthly Servicing Fees.
The Monthly Servicing Fee with respect to a series of Notes for any Payment
Date shall generally be equal to one-twelfth of the product of:
(1) the 'SERVICING FEE RATE' set forth in the related Series Supplement,
and
(2) the Pool Balance as of the last day of the preceding Collection Period
(excluding the amount of Principal Receivables relating to
Non-Serviced Participation Receivables); and
(3) the Series Allocation Percentage for such series for the immediately
preceding Collection Period.
The 'MONTHLY SERVICING FEE' with respect to any series shall be payable to the
Servicer solely to the extent amounts are available for distribution therefor in
accordance with the terms of the Trust Sale and Servicing Agreement. The share
of the Monthly Servicing Fee allocable to the Noteholders of a series (for each
series, the 'NOTEHOLDER MONTHLY SERVICING FEE') shall equal one-twelfth of the
product of (a) the Servicing Fee Rate and (b) the Invested Amount (as defined in
the related prospectus supplement) for such series as of the last day of the
Collection Period preceding such Payment Date. The remainder of the Monthly
Servicing Fee shall be paid by the Certificateholders and, in no event, shall
the Trust or the Noteholders be liable for the share of the Monthly Servicing
Fee to be paid by the Certificateholders.
The Servicer will pay from its servicing compensation specified expenses
incurred in connection with servicing the Accounts and the Receivables including
payment of fees and disbursements of the Indenture Trustee, the Owner Trustee,
attorneys and independent accountants and all other fees and expenses which are
not expressly stated in the Trust Sale and Servicing Agreement to be payable by
the Trust, the Certificateholders, the Noteholders or the Enhancement Providers
other than federal, state and local income and franchise taxes, if any, of the
Trust or the Noteholders.
CERTAIN MATTERS REGARDING THE SERVICER
The Servicer may not resign from its obligations and duties under the Trust
Sale and Servicing Agreement, except upon (i) a determination that such duties
are no longer permissible under applicable law and there is no reasonable action
which the Servicer could take to make the performance of its duties permissible
under applicable laws, or (ii) the receipt by the Indenture Trustee of
confirmation from each Rating Agency that such resignation will not result in a
reduction or withdrawal of such Rating Agency's rating of any outstanding series
of class of Notes. No such resignation will become effective until the Indenture
Trustee or a successor to the Servicer has assumed the Servicer's
responsibilities and obligations under the Trust Sale and Servicing Agreement.
If the Indenture Trustee is unable within 120 days of the date of such
determination to appoint a successor to the Servicer, the Indenture Trustee will
serve as the successor to the Servicer.
Any person into which, in accordance with the Trust Sale and Servicing
Agreement, the Servicer may be merged or consolidated or any person resulting
from any merger or consolidation to which the Servicer is a party, or any person
succeeding to the business of the Servicer, will be the successor to the
Servicer under the Trust Sale and Servicing Agreement.
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SERVICING DEFAULT
In the event of any unremedied Servicing Default, the Indenture Trustee, by
written notice to the Servicer with a copy to the Owner Trustee, may terminate
all of the rights and obligations of the Servicer, as servicer, under the Trust
Sale and Servicing Agreement and in and to the Receivables and the proceeds
thereof and appoint a new Servicer (a 'SERVICE TRANSFER'). The Indenture Trustee
shall as promptly as possible appoint a successor Servicer, subject to the
consent of any Enhancement Provider, and if no successor Servicer has been
appointed by the Indenture Trustee and has accepted such appointment by the time
the Servicer ceases to act as Servicer, all rights, authority, power and
obligations of the Servicer under the Trust Sale and Servicing Agreement shall
automatically pass to and be vested in the Indenture Trustee. Prior to any
Service Transfer, the Indenture Trustee will review any bids obtained from
potential servicers meeting specified eligibility requirements set forth in the
Trust Sale and Servicing Agreement to serve as successor Servicer for servicing
compensation not in excess of the Servicing Fee, plus specified excess amounts
payable to the Transferor.
A 'SERVICING DEFAULT' refers to any of the following events:
(1) failure by the Servicer to make any payment, transfer or deposit, or
to give instructions to the Owner Trustee or the Indenture Trustee to
make such payment, transfer or deposit or to give notice to the Owner
Trustee or the Indenture Trustee as to be taken with respect to any
agreement relating to an Enhancement, on the date the Servicer is
required to do so under the Trust Sale and Servicing Agreement, which
is not cured within a five business day grace period;
(2) failure on the part of the Servicer duly to observe or perform any
other covenants or agreements of the Servicer in the Trust Sale and
Servicing Agreement which failure has a materially adverse effect on
the Noteholders of any outstanding series and which continues
unremedied for a period of 30 days after the date written notice of
such failure, requiring same to be remedied, shall have been given to
the Servicer by the Indenture Trustee or the Owner Trustee, or the
Servicer delegates its duties under the Trust Sale and Servicing
Agreement, except as specifically permitted thereunder;
(3) any representation, warranty or certification made by the Servicer in
the Trust Sale and Servicing Agreement or in any certificate delivered
pursuant to the Trust Sale and Servicing Agreement proves to have been
incorrect when made, has a materially adverse effect on the rights of
the Noteholders of any outstanding series, and which materially
adverse effect continues for a period of 60 days after written notice
thereof shall have been given to the Servicer by the Indenture Trustee
or the Owner Trustee; or
(4) the occurrence of specified events of bankruptcy, insolvency or
receivership of the Servicer.
Notwithstanding the foregoing, a delay in or failure of performance
referred to under clause (1) above for a period of ten business days or referred
to under clauses (2) or (3) for a period of 60 business days, shall not
constitute a Servicing Default if such delay or failure could not be prevented
by the exercise of reasonable diligence by the Servicer and was caused by an act
of God or other similar occurrence. Upon the occurrence of any such event, the
Servicer shall not be relieved from using its best efforts to perform its
obligations in a timely manner in accordance with the terms of the Trust Sale
and Servicing Agreement and the Servicer shall provide the Owner Trustee,
Indenture Trustee, any agent, any Enhancement Provider, the Transferor and the
Noteholders prompt notice of such failure or delay by it, together with a
description of its efforts to so perform its obligations. The Servicer shall
immediately notify the Owner Trustee in writing of any Servicing Default.
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RIGHTS UPON SERVICING DEFAULT
As long as a Servicing Default under the Trust Sale and Servicing Agreement
remains unremedied, the Indenture Trustee may terminate all the rights and
obligations of the Servicer under such Trust Sale and Servicing Agreement,
whereupon such Indenture Trustee will succeed to all the responsibilities,
duties and liabilities of the Servicer under such agreement and will be entitled
to similar compensation arrangements.
If, however, a bankruptcy trustee or similar official has been appointed
for the Servicer, and no Servicing Default other than such appointment has
occurred, such trustee or official may have the power to prevent the Indenture
Trustee or the Owner Trustee or the Certificateholders from effecting a transfer
of servicing. In the event that the Indenture Trustee is unwilling or unable to
so act, it may appoint or petition a court of competent jurisdiction for the
appointment of any established institution with a net worth of at least
$100,000,000 and whose regular business includes the servicing of wholesale
receivables as successor. The Indenture Trustee may make such arrangements for
compensation to be paid, which in no event may be greater than the servicing
compensation to the Servicer under the Trust Sale and Servicing Agreement.
WAIVER OF PAST DEFAULTS
The holders of Notes evidencing at least a majority in principal amount of
the Notes (or, if the Notes have been paid in full, by the Certificateholders
whose Certificates evidence not less than a majority interest in the Trust) then
outstanding, voting as a single class, may, on behalf of all such Noteholders
and any Certificateholders, waive any default by the Servicer in the performance
of its obligations under the Trust Sale and Servicing Agreement and the
Receivables Purchase Agreement and its consequences, except a Servicing Default
in making any required distributions, payments, transfers or deposits in
accordance with the Trust Sale and Servicing Agreement. No such waiver will
impair the rights of the Indenture Trustee, the Owner Trustee, or the
Noteholders for subsequent defaults.
REPORTS
On the second business day preceding each Payment Date (each, a
'DETERMINATION DATE'), the Servicer will calculate the amounts to be allocated
in respect of Collections on Receivables received with respect to the related
Collection Period to the Noteholders of each outstanding series and class of
Notes or to the Transferor and the holder of any Supplemental Certificate in
accordance with the Series Supplement and the Transfer and Servicing Agreements.
On or before each Payment Date (including each Payment Date that
corresponds to an Interest Payment Date or any Special Payment Date), the
Indenture Trustee will forward to each Noteholder of record of any series a
statement (the 'PAYMENT DATE STATEMENT') prepared by the Servicer setting forth
information relating to the Trust and the Notes of such series, as specified in
the related Series Supplement and described in the related prospectus
supplement.
For each Interest Payment Date or Special Payment Date, the Payment Date
Statement for any series of Notes will include the following information for the
Notes of such series:
(a) the total amount distributed on the Notes of such series,
(b) the amount of such distribution allocable to principal on the Notes of
such series, and
(c) the amount of such distribution allocable to interest on the Notes of
such series.
Within a reasonable time after the Servicer has provided the Indenture
Trustee with information required by the Indenture Trustee to furnish such
statement, the Indenture Trustee will furnish (or cause
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to be furnished) to each person who at any time during the preceding calendar
year was a Noteholder of record a statement containing the information required
to be provided by an issuer of indebtedness under the U.S. Internal Revenue Code
for such preceding calendar year or the applicable portion thereof during which
such person was a Noteholder, together with such other customary information as
is required to be provided by an issuer of indebtedness under the U.S. Internal
Revenue Code and such other customary information as is necessary to enable the
Noteholders to prepare their tax returns. See 'Certain Federal Income Tax
Consequences.'
EVIDENCE AS TO COMPLIANCE
The Trust Sale and Servicing Agreement provides that a firm of independent
public accountants will furnish to the Owner Trustee, the Indenture Trustee, the
Rating Agencies, each agent and any Enhancement Provider on or before April 30
of each year, beginning on April 30, 2000, a report to the effect that such firm
has examined (a) the financial statements of the Servicer in accordance with
specified standards and (b) certain documents and records of the Servicer
relating to servicing. The report shall include a statement that nothing caused
such firm to believe that the Servicer did not comply with the Trust Sale and
Servicing Agreement during the preceding twelve months ended December 31 (or in
the case of the first such statement, the period from the Initial Closing Date
to December 31 of such year).
The Trust Sale and Servicing Agreement also provides for delivery to the
Owner Trustee and the Indenture Trustee, the Rating Agencies, each agent and any
Enhancement Provider on or before April 30 of each year, beginning April 30,
2000, a certificate signed by an officer of the Servicer stating that the
Servicer has fulfilled in all material respects its obligations under the Trust
Sale and Servicing Agreement throughout the preceding twelve months ended
December 31 (or in the case of the first such certificate, the period from the
Initial Closing Date to December 31 of such year) or, if there has been a
material default in the fulfillment of any such obligation, describing each such
default and the status thereof. The Servicer agrees to give the Owner Trustee
notice of Servicing Defaults under the Trust Sale and Servicing Agreement.
Copies of such statements and certificates may be obtained by Noteholders
by request in writing addressed to the Owner Trustee.
AMENDMENTS
Each of the Transfer and Servicing Agreements may be amended by the parties
thereto without the consent of the related Noteholders:
(1) to cure any ambiguity,
(2) to correct or supplement any provision therein that may be defective
or inconsistent with any other provision therein,
(3) to add or supplement any credit, liquidity or other enhancement
arrangement for the benefit of any Noteholders (provided that if any
such addition affects any series or class of Noteholders differently
than any other series or class of Noteholders, then such addition will
not, as evidenced by an opinion of counsel, adversely affect in any
material respect the interests of any series or class of Noteholders),
(4) to add to the covenants, restrictions or obligations of the
Transferor, the Servicer, the Trust, the Owner Trustee or the
Indenture Trustee for the benefit of Noteholders, or
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(5) to add, change or eliminate any other provision of such agreement in
any manner that will not, as evidenced by an officer's certificate,
adversely affect in any material respect the interests of the
Noteholders.
Each such Agreement may also be amended by the parties thereto with either
(a) the consent of the holders of at least a majority in principal amount of the
Controlling Class of each series of Notes adversely affected in any material
respect thereby or (b) confirmation from each Rating Agency that such amendment
will not result in the reduction or withdrawal of any ratings of the Notes for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of such agreement or of modifying in any manner the rights
of such Noteholders, except that no such amendment may:
(1) reduce in any manner the amount of, or accelerate or delay the timing
of, distributions or payments that are required to be made on any Note
or the amount available under any Enhancement without the consent of
the holder thereof,
(2) change the definition of or the manner of calculating the interest of
any Note without the consent of the holder thereof,
(3) adversely affect the rating of any series or class of Notes by any
Rating Agency without the consent of two-thirds of the principal
amount of the outstanding Notes of such series or class, or
(4) reduce the aforesaid percentage required to consent to any such
amendment without the consent of such aforesaid percentage of
Noteholders.
INTERCREDITOR ARRANGEMENTS
The agreements governing the Accounts provide for a security interest in
favor of World Omni in the Vehicles related to Receivables thereunder. For the
Receivables to be conveyed to the Trust, World Omni will represent in the
Receivables Purchase Agreement that the security interest in the related
Vehicles is a first priority perfected security interest. The security interest
in favor of World Omni in the Vehicles related to each Account the Receivables
of which are transferred to the Trust will be assigned by World Omni to the
Transferor pursuant to the Receivables Purchase Agreement and assigned to the
Trust by the Transferor pursuant to the Trust Sale and Servicing Agreement. In
its other lending activities, World Omni may have made capital loans, real
estate loans or other loans to Dealers that are also secured by a security
interest in such Vehicles. In the Receivables Purchase Agreement, World Omni
agrees that any security interests in such Vehicles that it may have in respect
of advances or loans to Dealers other than the related Receivables shall be
junior and subordinate to the security interests therein granted in connection
with the related Receivables and that it will not realize on any such collateral
in a manner materially adverse to the Transferor or the Trust and the
Noteholders until the Transferor and the Trust have been paid in full in respect
of their interests in the Receivables related to such Vehicles.
In addition, in connection with any such other loans or advances made by
World Omni to a Dealer, World Omni may also have a security interest in property
constituting Collateral Security other than Vehicles. In such cases, World Omni,
in its sole discretion, may realize on such other Collateral Security for its
own benefit in respect of such loans or advances before the Trust or the
Indenture Trustee, on behalf of any Noteholders, is permitted to realize upon
such other Collateral Security and the security interests of the Trust and
Indenture Trustee therein shall be junior and subordinate to the security
interests of World Omni granted in connection with such other loans and
advances. Because of the subordinate position of the Indenture Trustee in
respect of such other Collateral Security, there is no
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assurance that the Trust or the Indenture Trustee will realize any proceeds in
respect of any such other Collateral Security.
ADMINISTRATION AGREEMENT
World Omni, in its capacity as administrator (the 'ADMINISTRATOR'), entered
into the Administration Agreement, dated as of November 22, 1999 with the Trust
and the Indenture Trustee pursuant to which the Administrator agrees, to the
extent provided in such Administration Agreement, to provide the notices and to
perform other administrative obligations required by the Indenture. As
compensation for the performance of the Administrator's obligations under the
Administration Agreement and as reimbursement for its expenses related thereto,
the Administrator will be entitled to a monthly administration fee in an amount
equal to $1,500, which fee will be paid by the Servicer.
CERTAIN ADMINISTRATIVE AND LEGAL PROCEEDINGS
As part of its regular examination process of the consolidated federal
income tax returns of JM Family Enterprises and its subsidiaries (including
World Omni) for certain prior years, the IRS is reviewing, among other things,
some transactions that were consummated in prior years relating to retail lease
contracts. The IRS has proposed treating these transactions as sales rather than
financings for federal income tax purposes, which would affect World Omni's
depreciation deductions. It has also proposed treating the origination trust and
each securization trust created for those transactions as an association taxable
as a corporation rather than a trust for federal income tax purposes. In
connection with each transaction, World Omni received an opinion of tax counsel
to the effect that these transactions were properly treated as financings for
federal income tax purposes and that neither the origination trust nor the
relevant securitization trust would be treated as an association taxable as a
corporation for federal income tax purposes. While management believes that a
challenge by the IRS would be unsuccessful, we cannot assure you of this result.
The IRS has also proposed changes to other positions that were taken on the tax
returns it is examining.
Management is vigorously defending its positions and believes that the
ultimate resolution of all of the issues will not have a material adverse effect
on security holders, or on JM Family Enterprises' or World Omni's operations and
financial condition. However, if the IRS were to prevail on certain of these
issues, it could have a material adverse effect on JM Family Enterprises' or
World Omni's operations and financial condition. Nevertheless, management
believes that even if the IRS were to prevail on all of these issues, it would
not result in any material impairment of World Omni's ability to perform its
obligations and its duties as Servicer under the Trust documents. Management
cannot however, assure you of this result.
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CERTAIN LEGAL ASPECTS OF THE RECEIVABLES
TRANSFER OF RECEIVABLES
On the closing date and each day thereafter, World Omni will sell the
Receivables to the Transferor, and the Transferor will immediately transfer the
Receivables to the Trust, which the Trust will pledge to the Indenture Trustee
for the benefit of the Noteholders. The Transferor represents that:
o the sale or transfer to the Trust constitutes a valid transfer and
assignment to the Trust of all right, title and interest of the
Transferor in, to and under the Receivables;
o under applicable Florida law, there exists a valid, ownership interest
in the Receivables; and
o in the event the sale by the Transferor to the Trust is recharacterized
as a grant of a security interest instead of a true sale, the Trust will
have an enforceable first priority perfected security interest in the
Receivables following their transfer to the Trust.
For a discussion of the Trust's rights arising from a breach of these
representations, see 'The Transfer and Servicing Agreements--Representations and
Warranties of the Transferor.'
Each of World Omni and the Transferor has represented that the Receivables
are 'instruments,' 'accounts,' 'chattel paper' or 'general intangibles' for
purposes of Florida's Uniform Commercial Code. Any dealer promissory notes
evidencing the Receivables which constitute 'instruments' under the Uniform
Commercial Code have been and will continue to be transferred by the Transferor,
to the Trust and to the Indenture Trustee's office located in Wilmington,
Delaware. However, if the Receivables are deemed to be accounts, chattel paper
or general intangibles and the transfer of the Receivables by World Omni to the
Transferor, by the Transferor to the Trust or by the Trust to the Indenture
Trustee is deemed either to be a sale or to create a security interest, the
Uniform Commercial Code or other applicable law applies. In the case of chattel
paper, the Indenture Trustee, as transferee, would then have to take possession
of the chattel paper or file an appropriate financing statement or statements in
order to perfect its interests in the Receivables. As a precautionary measure,
financing statements covering the Receivables have been filed under the Florida
Uniform Commercial Code by the Transferor, the Trust and the Indenture Trustee
to perfect their respective interests in the Receivables and continuation
statements will be filed, as required, to continue the perfection of their
interests in the Receivables.
There are limited circumstances under the Uniform Commercial Code and
applicable federal law in which prior or subsequent transferees of Receivables
could have an interest in the Receivables with priority over the Trust's and the
Indenture Trustee's interest. A purchaser of the Receivables who gives new value
and takes possession of the documents which evidence the Receivables in the
ordinary course of the purchaser's business may have priority over the Trust's
and the Indenture Trustee's interest in the Receivables. A tax or other
government lien on property of World Omni or the Transferor arising before a
Receivable is conveyed to the Trust or to the Indenture Trustee may also have
priority over the Trust's and the Indenture Trustee's interest in the
transferred Receivable. Under the Receivables Purchase Agreement, World Omni
represents to the Transferor, under the Trust Sale and Servicing Agreement the
Transferor represents to the Trust, and under the Indenture the Trust represents
to the Indenture Trustee that the Receivables have been transferred free and
clear of any third party lien. In addition, the Transferor agrees under the
Trust Sale and Servicing Agreement to deliver to the Trust, and the Trust agrees
under the Indenture to deliver to the Indenture Trustee any necessary
instruments, such as any promissory notes received from Dealers, which evidence
the Receivables. Each of World Omni, the Transferor and the Trust also covenants
that it will not transfer or grant any lien on any Receivable or, except as
described under 'The Transfer and Servicing Agreements--The Certificates,' the
Certificates, other than to the Trust or the Indenture Trustee. In addition,
while World Omni is the Servicer, cash collections on the Receivables may, under
specified circumstances, be commingled with the funds of
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World Omni prior to each Payment Date and, in the event of a World Omni
bankruptcy, the Trust and the Indenture Trustee may not have a perfected
interest in the commingled collections.
CERTAIN MATTERS RELATING TO BANKRUPTCY
If World Omni were to become a debtor in a bankruptcy case, a creditor or
trustee in bankruptcy of World Omni or World Omni may attempt to characterize
the transfer of the Receivables from World Omni to the Transferor as a pledge of
the Receivables to secure a borrowing by World Omni rather than a true sale of
the Receivables. World Omni represents to the Transferor in the Receivables
Purchase Agreement that the sales of the Receivables by World Omni to the
Transferor are valid sales of the Receivables to the Transferor. In addition,
World Omni and the Transferor agree to treat these transfers as sales of the
Receivables to the Transferor, and World Omni will take all actions that are
required under Florida law to perfect the Transferor's ownership interest in the
Receivables. If these transfers are treated as sales, the Receivables would not
be part of World Omni's bankruptcy estate and would not be available to World
Omni's creditors.
In Octagon Gas Systems, Inc. v. Rimmer, 995 F.2d 948 (10th Cir. 1993), the
United States Court of Appeals for the Tenth Circuit suggested that, even where
a transfer of accounts from a seller to a buyer constitutes a true sale, the
accounts would nevertheless constitute property of the seller's bankruptcy
estate in a bankruptcy of the seller. The Transferor has been advised by counsel
that the reasoning of the Octagon court appears to be inconsistent with
established precedent and the Uniform Commercial Code. In addition, the
Permanent Editorial Board of the Uniform Commercial Code has issued an official
commentary (P&B Commentary No. 14) which characterizes the Octagon court's
interpretation of Article 9 of the Uniform Commercial Code to be erroneous. Such
commentary states that nothing in Article 9 is intended to prevent the transfer
of ownership of accounts or chattel paper.
In addition, if World Omni were to become a debtor in a bankruptcy case, a
creditor or the bankruptcy trustee or World Omni itself might request that World
Omni be substantively consolidated with the Transferor. Delays or reductions in
payments on the Notes could occur while the court decides these issues. In
addition, should a court rule that the Receivables are part of World Omni's
bankruptcy estate, or that World Omni should be substantively consolidated with
the Transferor, additional reductions or delays in payments on the Notes could
result. See 'Risk Factors--A Bankruptcy of World Omni or the Transferor May
Delay or Reduce Payments on the Notes.'
If the Transferor were to become a bankrupt debtor, an Early Amortization
Event would occur which may result in a lack of funds available to make full and
timely payment on the Notes. The Transferor has attempted to reduce the
likelihood that it will file for bankruptcy. The Transferor's limited liability
company agreement provides that, under specified circumstances, the Transferor
is required to have two independent directors, as such term is defined in its
limited liability company agreement. The Transferor's limited liability company
agreement also provided that the Transferor will not file a voluntary
application for relief under the U.S. Bankruptcy Code without the affirmative
vote of its two independent directors. Under the Trust Sale and Servicing
Agreement, the Indenture Trustee, the Trust, the Owner Trustee, all the
Noteholders and any Enhancement Provider agree that they will not until one year
and one day after termination of the Indenture institute against the Transferor
any bankruptcy, reorganization or other proceedings under any federal or state
bankruptcy or similar law. The Transferor does not intend to file a voluntary
application for relief under the Bankruptcy Code or any similar applicable state
law regarding the Transferor so long as the Transferor is solvent, and the
Transferor does not foresee it becoming insolvent.
If World Omni or the Transferor filed for bankruptcy under the federal
bankruptcy code or any state insolvency laws, then World Omni or the Transferor
may be able to recover payments they made to the Trust to repurchase
Receivables. In general, World Omni or the Transferor might recover any
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payments made by them to the Trust during the one-year period before the date
World Omni or the Transferor filed for bankruptcy. The one-year period may be
extended by the court if it determines that the bankrupt entity was insolvent
more than one year prior to filing its bankruptcy petition.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
GENERAL
Set forth below is a discussion of the anticipated material United States
federal income tax consequences of the purchase, ownership and disposition of
the Notes offered by this prospectus. This discussion is based upon current
provisions of the U.S. Internal Revenue Code, existing and proposed Treasury
regulations, current administrative rulings, judicial decisions and other
applicable authorities. There are no cases or IRS rulings on similar
transactions involving debt issued by a trust with terms similar to those of the
Notes. As a result, there can be no assurance that the IRS will not challenge
the conclusions reached in this section, and no ruling from the IRS has been or
will be sought on any of the issues discussed below. Furthermore, legislative,
judicial or administrative changes may occur, perhaps with retroactive effect,
which could affect the accuracy of the statements and conclusions set forth in
this prospectus as well as the tax consequences to Noteholders.
This discussion does not claim to deal with all aspects of federal income
taxation that may be relevant to the holders of Notes in light of their personal
investment circumstances nor, except for specific limited discussions of
particular topics, to Noteholders subject to special treatment under the federal
income tax laws, such as financial institutions, broker-dealers, life insurance
companies and tax-exempt organizations. This information is directed only to
prospective purchasers who:
o purchase Notes in the initial distribution of the Notes;
o are citizens or residents of the United States, including domestic
corporations, limited liability companies and partnerships; and
o hold the Notes as 'capital assets' within the meaning of Section 1221 of
the U.S. Internal Revenue Code.
PROSPECTIVE INVESTORS SHOULD CONSULT WITH THEIR TAX ADVISORS AS TO THE FEDERAL,
STATE, LOCAL, FOREIGN AND ANY OTHER TAX CONSEQUENCES TO THEM OF THE PURCHASE,
OWNERSHIP AND DISPOSITION OF NOTES.
TAX CHARACTERIZATION AND TREATMENT OF NOTES
CHARACTERIZATION AS DEBT. For each series of Notes, except for any series
which is specifically identified as receiving different tax treatment in the
related prospectus supplement, Kirkland & Ellis, special tax counsel to the
Transferor ('TAX COUNSEL'), will deliver its opinion to the effect that the
Notes will be treated as debt for federal income tax purposes. The Transferor,
the Servicer and each Noteholder, by acquiring an interest in a Note, will agree
to treat the Notes as indebtedness for federal, state and local income and
franchise tax purposes. See 'Tax Characterization of the Trust--Risks of
Alternative Characterization' below for a discussion of the potential federal
income tax consequences to Noteholders if the IRS were successful in challenging
the characterization of the Notes for federal income tax purposes.
TREATMENT OF STATED INTEREST. Based on Tax Counsel's opinion that the
Notes will be treated as debt for federal income tax purposes, and assuming the
Notes are not issued with original issue discount ('OID'), the stated interest
on a Note will be taxable to a Noteholder as ordinary income when received or
accrued in accordance with each Noteholder's method of tax accounting. Interest
received on
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a Note may constitute 'investment income' for purposes of some provisions in the
U.S. Internal Revenue Code limiting the deductibility of investment interest
expense.
ORIGINAL ISSUE DISCOUNT. Except to the extent indicated in the related
prospectus supplement, no series of Notes will be issued with OID. In general,
OID is the excess of the 'stated redemption price at maturity' of a debt
instrument over its 'issue price,' unless the OID is small enough to fall within
a statutorily defined de minimis exception. A Note's 'stated redemption price at
maturity' is the total of all payments required to be made under the Note
through maturity except 'qualified stated interest.' 'Qualified stated interest'
is generally interest that is unconditionally payable in cash or property, other
than debt instruments of the issuer, at fixed intervals of one year or less
during the entire term of the instrument at specified rates. The 'issue price'
will be the initial price at which a substantial amount of the Notes are sold,
excluding sales to bond holders, brokers or similar persons acting as
underwriters, placement agents or wholesalers.
Although it is not anticipated, except to the extent indicated in the
related prospectus supplement, that any series of Notes will be issued at a
greater than de minimis discount, a series of Notes may nevertheless be deemed
to have been issued with OID. First, under Treasury regulations, interest
payments on a series of Notes may not be deemed 'qualified stated interest' if
(i) reasonable legal remedies do not exist to compel timely payment or (ii) the
Notes do not otherwise provide terms and conditions that make the likelihood of
late payment (other than a late payment that occurs within a reasonable grace
period) or nonpayment a remote contingency. If a series of Notes does not pay
qualified stated interest, all of the taxable income thereon would be includible
in income as OID. Second, the IRS could take the position (under regulations
that have not yet been issued pursuant to Section 1272(a)(6) of the Code) that a
series of Notes has OID.
If a Note were treated as being issued with OID, a Noteholder would be
required to include OID in its income as interest over the term of the Note
under a constant yield method. In general, OID must be included in income in
advance of the receipt of cash representing that income. Thus, each cash
distribution would be treated as an amount already included in income (to the
extent OID has accrued as of the date of the interest distribution and is not
allocated to prior distributions), or as a repayment of principal. This
treatment would have no significant effect on Noteholders using the accrual
method of accounting. However, cash method Noteholders may be required to report
income with respect to the Notes in advance of the receipt of cash attributable
to such income. In this situation you would have to rely on other sources to pay
the taxes on your OID income. Even if a note has OID falling within the de
minimis exception, the Noteholder must include such OID in income
proportionately as principal payments are made on such Note.
A holder of a Note which has a fixed maturity date not more than one year
from the issue date of such Note (a 'SHORT-TERM NOTE') will generally not be
required to include OID income on the Note as it accrues. However, the foregoing
rule may not apply if such holder holds the instrument as part of a hedging
transaction, or as a stripped bond or stripped coupon or if the holder is:
o an accrual method taxpayer;
o a bank;
o a broker or dealer that holds the Note as inventory;
o a regulated investment company or common trust fund; or
o the beneficial owner of specified pass-through entities specified in the
U.S. Internal Revenue Code.
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A holder of a Short-Term Note who is not required to include OID income on the
note as it accrues will instead include the OID accrued on the Note in gross
income upon a sale or exchange of the Note or at maturity, or if the Short-Term
Note is payable in installments, as principal is paid thereon. A holder would be
required to defer deductions for any interest expense on an obligation incurred
to purchase or carry the Short-Term Note to the extent it exceeds the sum of any
interest income and OID accrued on such Note. However, a holder may elect to
include OID in income as it accrues on all obligations having a maturity of one
year or less held by the holder in that taxable year or thereafter, in which
case the deferral rule of the preceding sentence will not apply. For purposes of
this paragraph, OID accrues on a Short-Term Note on a straight-line basis,
unless the holder irrevocably elects, under regulations to be issued by the
Treasury Department, to apply a constant interest method, using the holder's
yield to maturity and daily compounding.
A holder who purchases a Note after its initial distribution at a discount
that exceeds a statutorily defined de minimis amount will be subject to the
'market discount' rules of the U.S. Internal Revenue Code, and a holder who
purchases a Note at a premium will be subject to the bond premium amortization
rules of the U.S. Internal Revenue Code.
DISPOSITION OF NOTES. If a Noteholder sells a Note, the holder will
recognize gain or loss in an amount equal to the difference between the amount
realized on the sale and the holder's adjusted tax basis in the Note. The
adjusted tax basis of the Note to a particular Noteholder will equal the
holder's cost for the Note, increased by any OID and market discount previously
included by such Noteholder in income with respect to the Note and decreased by
any bond premium previously amortized and any payments of principal and OID
previously received by such Noteholder with respect to such Note. Any gain or
loss on sale will be capital gain or loss if the Note was held as a capital
asset, except for gain representing accrued interest or accrued market discount
not previously included in income. Capital gain or loss will be long-term if the
Note was held by the holder for more than one year and otherwise will be
short-term. Any capital losses realized generally may be used by a corporate
taxpayer only to offset capital gains, and by an individual taxpayer only to the
extent of capital gains plus $3,000 of other income.
NOTES SUBJECT TO CONTINGENCIES. The United States federal income tax
consequences to an owner or seller of Notes that provide for one or more
contingent payments will vary depending on the exact terms of the Notes and
related factors. The Notes may be subject to rules that differ from the general
rules discussed above. The United States federal income tax consequences to a
holder of Notes that provide for contingent payments will be summarized in the
related prospectus supplement.
INFORMATION REPORTING AND BACKUP WITHHOLDING. The Trustee will be required
to report annually to the IRS, and to each related Noteholder of record, the
amount of interest paid on the Notes, and any amount of interest withheld for
federal income taxes, for each calendar year, except as to exempt holders
(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 holder will be required to
provide to the Trustee, under penalties of perjury, a certificate containing the
holder's name, address, correct federal taxpayer identification number and a
statement that the holder is not subject to backup withholding. Should a
Noteholder who is not exempt from backup withholding fail to provide the
required certification, the Trustee will be required to withhold, from interest
otherwise payable to the holder, 31% of the holder's interest income and pay the
withheld amount to the IRS as a credit against the holder's federal income tax
liability.
The IRS has issued new regulations governing the backup withholding and
information reporting requirements. The new regulations are generally effective
for payments made after December 31, 2000. Noteholders should consult their tax
advisors with respect to the impact, if any, of the new regulations.
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Because the Transferor will, for federal income tax purposes, treat all
Notes as indebtedness issued by the Trust characterized as either a partnership
or a division of whichever entity owns all of its Certificates, the Transferor
will not comply with the tax reporting requirements that would apply under any
alternative characterization of the Trust.
TAX CONSEQUENCES TO FOREIGN NOTEHOLDERS. If interest paid or accrued to a
Noteholder who is a nonresident alien, foreign corporation or other non-United
States person (a 'FOREIGN PERSON') is not effectively connected with the conduct
of a trade or business within the United States by the foreign person, the
Note's interest generally will be considered 'portfolio interest,' and generally
will not be subject to United States federal income tax and withholding. This
exemption generally will apply only if the foreign person:
o is not actually or constructively a '10 percent shareholder' of the
Trust or the Transferor (including a holder of 10% of the outstanding
certificates of the Trust) or a 'controlled foreign corporation' for
which the Trust or the Transferor is a 'related person' within the
meaning of the U.S. Internal Revenue Code; and
o provides an appropriate statement, signed under penalties of perjury,
certifying that the beneficial owner of the Note 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
inform the Indenture Trustee within 30 days of the change. 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 such tax were reduced or
eliminated pursuant to an applicable tax treaty. The IRS has amended the
transition period relating to new regulations governing withholding, backup
withholding and information reporting requirements. Withholding certificates or
statements that are valid on December 31, 1999, may be treated as valid until
the earlier of their expiration or December 31, 2000. All existing certificates
or statements will cease to be effective after December 31, 2000.
Any capital gain realized on the sale, redemption, retirement or other
taxable disposition of a Note by a foreign person will be exempt from United
States federal income and withholding tax, provided that:
o the gain is not effectively connected with the conduct of a trade or
business in the United States by the foreign person; and
o in the case of a foreign individual, the foreign person is not present
in the United States for 183 days or more in the taxable year.
If the interest, gain or income on a 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, such holder, although exempt from the withholding
tax previously discussed if an appropriate statement is furnished, will
generally 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 U.S. Internal Revenue Code for the taxable year, subject to
adjustment, unless it qualifies for a lower rate under an applicable tax treaty.
TAX CHARACTERIZATION OF THE TRUST
Depending upon whether Certificates are owned by one or more persons, the
Trust will be treated as a division of the Transferor or as a partnership for
federal income tax purposes. The related prospectus supplement will specify the
treatment of the Trust for federal income tax purposes.
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If the Trust issues Certificates only to the Transferor, the equity of the
Trust will be wholly-owned by the Transferor. In this case, under the
'check-the-box' Treasury regulations, the Trust will be treated as a division of
the Transferor and disregarded for federal income tax purposes. In other words,
for federal income tax purposes, the Transferor will be treated as the owner of
all the assets of the Trust and the obligor of all the liabilities of the Trust.
Accordingly, the Trust would not be directly liable for any federal income taxes
as it would be deemed not to exist for federal income tax purposes. Under the
'check-the-box' Treasury regulations, unless it is treated as a trust for
federal income tax purposes, an unincorporated domestic entity with more than
one equity owner is automatically classified as a partnership for federal income
tax purposes. Because it is a business trust, the Trust will not qualify as a
trust for federal income tax purposes, and accordingly, if Certificates are sold
or issued in any manner which results in there being more than one equity owner,
the Trust will be treated as a partnership.
If Certificates are issued to more than one person, the Transferor and the
Servicer will agree, and the applicable Certificateholders will agree by their
purchase, to treat the Trust as a partnership for purposes of federal, state and
local income and franchise tax purposes, with the partners of such partnership
being the Certificateholders and the Notes being debt of the partnership.
However, the proper characterization of the arrangement involving the
Certificates, the Transferor and the Servicer is not clear because there is no
authority on transactions closely comparable to that contemplated in this
prospectus.
RISK OF ALTERNATIVE CHARACTERIZATION. Under the U.S. Internal Revenue Code
and specified Treasury Regulations (the 'PTP REGULATIONS') a partnership may be
classified as a publicly traded partnership ('PTP') if equity interests in the
partnership are traded on an 'established securities market' or are 'readily
tradeable' on a 'secondary market' or its 'substantial equivalent.' For federal
income tax purposes, a PTP is taxable as a corporation and subject to corporate
income tax. Any corporate income tax could materially reduce or eliminate cash
that would otherwise be distributable for the applicable Notes and Certificates,
and Certificateholders could be liable for any tax that is unpaid by the Trust.
However, the Trust will comply with available safe harbors under the PTP
Regulations to avoid PTP characterization. Furthermore, even if the Trust were
classified as a PTP, it would avoid taxation as a corporation if 90% or more of
its annual income constituted 'qualifying income' not derived in the conduct of
a 'financial business.' It is unclear whether the Trust's income would be so
classified. However, Tax Counsel will deliver its opinion that the Trust will
not be classified as a publicly traded partnership taxable as a corporation.
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STATE AND LOCAL TAX CONSEQUENCES
The State of Florida imposes a value-based intangibles tax on January 1 of
each year at the rate of $1.50 per $1,000 of value on certain intangibles owned,
managed or controlled by Florida domiciliaries or intangibles having a business
situs in Florida. On the last business day of each year, in an effort to
minimize the impact of this intangibles tax, the Transferor intends to transfer
99% of its right, title and interest in, to and under the Certificates owned by
the Transferor as of such day, together with all of its duties, rights and
obligations under the Trust Sale and Servicing Agreement to World Omni
Wholesale, Inc. ('WOWI'), a wholly-owned subsidiary of World Omni, located and
managed outside the State of Florida (such transfer, the 'ANNUAL SERVICING
TRANSFER'). In connection with such Annual Servicing Transfer, the Servicer
shall transfer all of its rights, obligations and duties under the Trust Sale
and Servicing Agreement to WOWI. The Trust will continue to maintain its first
priority perfected security interest in the Receivables. Only the Transferor's
interest in the Certificates, together with the Servicer's management and
control authority and obligations will be transferred to WOWI, to be held in
escrow and returned to the Transferor and the Servicer, respectively, on the
first business day of the following year. This annual transfer is consistent
with the Technical Assistance Advisement 95(C)2-021 issued by the Florida
Department of Revenue, which holds that a transfer of receivables to a
wholly-owned subsidiary located outside the State of Florida and having no
contacts with the State of Florida was sufficient to avoid the imposition of the
intangibles tax on the receivables subject to such tax. As additional
protection, the Trust will be indemnified by the Transferor, which in turn will
be indemnified by World Omni, with respect to any liability for this intangibles
tax. The Servicer has agreed in the Trust Sale and Servicing Agreement not to
conduct any servicing activities during the period of the Annual Servicing
Transfer.
The above discussion does not address the tax treatment of any series of
Notes or the holders of Notes under any state or local tax laws. The activities
to be undertaken by the Servicer in servicing and collecting the Receivables
will take place throughout the United States and, therefore, many different tax
regimes could apply to this transaction. Prospective investors are urged to
consult with their tax advisors regarding the state and local tax treatment of
the Trust as well as any state and local tax consequences to investors by
purchasing, holding and disposing of Notes.
ERISA CONSIDERATIONS
Section 406 of ERISA and Section 4975 of the U.S. Internal Revenue Code
prohibit a pension, profit-sharing or other employee benefit plan, as well as
individual retirement accounts and some types of Keogh Plans (each a 'BENEFIT
PLAN'), from engaging in specified transactions with persons that are 'parties
in interest' under ERISA or 'disqualified persons' under the U.S. Internal
Revenue Code with respect to such Benefit Plan. A violation of these 'prohibited
transaction' rules may result in an excise tax or other penalties and
liabilities under ERISA and the U.S. Internal Revenue Code for such persons.
Some transactions involving the Trust might be deemed to constitute
prohibited transactions under ERISA and the U.S. Internal Revenue Code for a
Benefit Plan that purchased Notes if assets of the Trust were deemed to be
assets of the Benefit 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 Benefit Plan for the purposes of ERISA and
the U.S. Internal Revenue Code only if the Benefit Plan acquired an 'equity
interest' in the Trust and none of the exceptions contained in the Plan Assets
Regulation was 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 little guidance on the subject, the Transferor
believes the Notes of the Trust should be treated as indebtedness without
substantial equity features for
78
<PAGE>
purposes of the Plan Assets Regulation. Other exceptions, if any, from
application of the Plan Assets Regulation available for any Notes will be
discussed in the related prospectus supplement.
However, disregarding whether Notes are treated as equity interests for
Plan Asset Regulation purposes, the acquisition or holding of Notes by or on
behalf of a Benefit Plan could be considered to give rise to a prohibited
transaction if the Transferor, the Servicer, the Trust or any of their
respective affiliates is or becomes a party in interest or a disqualified person
with respect to such Benefit Plan. Limited exemptions from the prohibited
transaction rules could be applicable to the purchase and holding of Notes by a
Benefit Plan depending on the type and circumstances of the plan fiduciary
making the decision to acquire the Notes. Included among these exemptions are:
o Prohibited Transaction Class Exemption ('PTCE') 90-1, regarding
investments by insurance company pooled separate accounts;
o PTCE 91-38, regarding investments by bank collective investment funds;
o PTCE 84-14, regarding transactions effected by qualified professional
asset managers;
o PTCE 95-60, regarding transactions by life insurance company general
accounts; and
o PTCE 96-23, regarding transactions affected by in-house asset managers.
Employee benefit plans that are governmental plans, as defined in Section
3(32) of ERISA, and some church plans, as defined in Section 3(33) of ERISA, are
not subject to ERISA requirements.
A plan fiduciary considering the purchase of Notes should consult its tax
and/or legal advisors regarding whether the assets of the Trust would be
considered plan assets and the possibility of exemptive relief from the
prohibited transaction rules as well as related issues and their potential
consequences.
PLAN OF DISTRIBUTION
The Transferor will sell each series of Notes offered for sale, on the
terms and conditions set forth in an underwriting agreement (each, an
'UNDERWRITING AGREEMENT'). For each offering, the Transferor will agree to sell
to each of the underwriters named in the Underwriting Agreement and in the
related prospectus supplement and each of the underwriters will severally agree
to purchase from the Transferor, the principal amount of Notes set forth in the
Underwriting Agreement and in the related prospectus supplement.
In each Underwriting Agreement, the underwriters will agree, subject to the
terms and conditions set forth in the Underwriting Agreement, to purchase all
the Notes described in the Underwriting Agreement which are offered by this
prospectus and by the related prospectus supplement, if any of the Notes are
purchased. In the event of a default by any underwriter, each Underwriting
Agreement will provide that, in specified circumstances, purchase commitments of
the nondefaulting underwriters may be increased or the Underwriting Agreement
may be terminated.
Each prospectus supplement will either:
(1) set forth the price at which each series or class of Notes being
offered by the prospectus supplement will be offered to the public and
any concessions that may be offered to the dealers participating in
the offering of the Notes; or
(2) specify that the Notes are to be resold by the Underwriters in
negotiated transactions at varying prices to be determined at the time
of such sale.
79
<PAGE>
After the initial public offering of any Notes, the public offering price and
such concessions may be changed.
The extent, if any, to which the closing of any series of Notes is
conditioned upon the closing of any other series of Notes will be set forth in
the related prospectus supplement.
Each Underwriting Agreement will provide that the Transferor will indemnify
the underwriters against specified liabilities, including liabilities under the
Securities Act of 1933.
The Indenture Trustee may invest the funds in the Eligible Deposit Accounts
in Eligible Investments acquired from the underwriters.
The place and time of delivery for the Notes for which this prospectus is
delivered will be set forth in the related prospectus supplement.
LEGAL OPINIONS
Certain legal matters relating to the Notes will be passed upon for the
Trust, the Transferor and World Omni by Kirkland & Ellis, special counsel to the
Trust, the Transferor and World Omni. Certain federal income tax matters will be
passed upon for the Trust, the Transferor and the Servicer by Kirkland & Ellis.
WHERE YOU CAN FIND MORE INFORMATION
The Transferor, as originator of the Trust, filed a registration statement
relating to the Notes with the Securities and Exchange Commission (the 'SEC')
under the Securities Act of 1933. This prospectus is part of the registration
statement, but the registration statement includes additional information.
The Transferor will file with the SEC all required annual, monthly and
special SEC reports and other information about the Trust.
You may read and copy any reports, statements or other information filed by
the Transferor or the Registrant at the SEC's public reference room at 450 Fifth
Street, Washington, D.C. 20549. You can request copies of these documents, upon
payment of a duplicating fee, by writing to the SEC. Please call the SEC at
(800) SEC-0330 for further information on the operation of the public reference
rooms. These SEC filings are also available to the public on the SEC Internet
site (http://www.sec.gov).
80
<PAGE>
INCORPORATION BY REFERENCE
The SEC allows information filed with it to be 'incorporated by reference'
into this prospectus, which means that the Registrant can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be part of this prospectus.
Information that the Transferor files with the SEC after the date of this
prospectus will automatically update the information in this prospectus. In all
cases, you should rely on the later information over different information
included in this prospectus or the prospectus supplement.
The Transferor incorporates by reference any future annual, monthly and
special reports and proxy materials filed by or on behalf of the Trust with the
SEC until the offering of the Notes is terminated. The Transferor will not be
required to file reports pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, except for the filing of monthly Current Reports on Form
8-K. As of the date of this prospectus, the Transferor had not filed any Current
Reports on Form 8-K.
As a recipient of this prospectus, you may request a copy of any document
incorporated by reference into this prospectus, except exhibits to the documents
(unless the exhibits are specifically incorporated by reference), at no cost, by
writing or calling: World Omni Financial Corp., 120 N.W. 12th Avenue, Deerfield
Beach, Florida 33442, Attention: Corporate Secretary, telephone: (954) 429-2200.
81
<PAGE>
INDEX OF TERMS
The following is a list of the defined terms used in this prospectus and
any prospectus supplement and the pages on which the definitions of such terms
may be found in this prospectus.
<TABLE>
<S> <C>
Accounts....................................... 15
Accumulation Period............................ 26
Accumulation Period Commencement Date.......... 26
Addition Date.................................. 50
Additional Accounts............................ 54
Additional Cut-Off Date........................ 50
Adjustment Payment............................. 60
Administrative Agreement....................... 47
Administrator.................................. 70
Amortization Period............................ 26
Annual Servicing Transfer...................... 78
Asset Based Receivables........................ 17
Automatic Additional Accounts.................. 55
Automatic Removal Date......................... 58
Automatic Removed Accounts..................... 58
Available Subordinated Amount.................. 40
Benefit Plan................................... 78
Book Review.................................... 21
Cede........................................... 44
Certificates................................... 16
Class I Dealers................................ 19
Class II Dealers............................... 19
Class III Dealers.............................. 20
Class IV Dealers............................... 20
Class V Dealers................................ 20
Class VI Dealers............................... 20
Clearstream Participants....................... 44
Collateral Security............................ 15
Collection Account............................. 34
Collection Period.............................. 39
Collections.................................... 15
Controlled Amortization Amount................. 27
Controlled Deposit Amount...................... 26
Controlling Class.............................. 29
Cooperative.................................... 45
Dealers........................................ 15
Defaulted Amount............................... 59
Defaulted Receivables.......................... 59
Definitive Notes............................... 46
Depository..................................... 25
Designated Accounts............................ 56
Designated Balance............................. 56
Designated Receivables......................... 57
Determination Date............................. 67
Disclosure Document............................ 41
Disqualified Receivables....................... 51
DTC............................................ 43
Early Amortization Event....................... 61
Early Amortization Period...................... 27
Eligible Account............................... 52
Eligible Deposit Account....................... 34
Eligible Institution........................... 34
Eligible Investments........................... 34
Eligible Receivable............................ 52
Enhancement.................................... 15
Enhancement Provider........................... 52
Euroclear Operator............................. 45
Euroclear Participants......................... 44
Events of Default.............................. 30
Excess Funding Account......................... 37
Excess Principal Collections................... 39
Excess Receivables............................. 54
Excluded Series................................ 33
Expected Principal Payment Date................ 26
Financial Statement Review..................... 19, 21
Fitch.......................................... 34
Floor Plan Equity Program...................... 21
foreign person................................. 76
Fully Funded Date.............................. 27
Indenture...................................... 25
Indenture Trustee.............................. 42
Indirect Participants.......................... 44
Ineligible Amount.............................. 54
Ineligible Receivables......................... 54
Initial Closing Date........................... 15
Initial Cut-Off Date........................... 15
Initial Invested Amount........................ 38
Insolvency Laws................................ 14
Interest Funding Account....................... 25
Interest Payment Dates......................... 25
Investment Event............................... 27, 61
Investment Period.............................. 27
Investment Period Commencement Date............ 27
Investor Charge-Offs........................... 39
Issuer......................................... 6
Issue price.................................... 74
JM Family Enterprises.......................... 14
</TABLE>
82
<PAGE>
<TABLE>
<S> <C>
LIBOR.......................................... 21
Minimum Required Pool Balance.................. 60
Miscellaneous Payments......................... 38
Monthly Servicing Fee.......................... 65
Moody's........................................ 34
Non-Principal Collections...................... 15
Non-Serviced Participation Receivables......... 63
Non-Vehicle Collateral Security................ 23
Note Owner..................................... 44
Noteholder..................................... 25
Noteholder Monthly Servicing Fee............... 65
Notes.......................................... 16
OID............................................ 73
Overconcentration Amount....................... 54
Owner Trustee.................................. 15
Paired Series.................................. 33
Participants................................... 43
Participations................................. 23
Payment Date................................... 25
Payment Date Statement......................... 67
Plan Assets Regulation......................... 78
Pool Balance................................... 37
Principal Collections.......................... 15
Principal Commencement Date.................... 26
Principal Funding Account...................... 26
Principal Receivables.......................... 37
Principal Shortfall............................ 39
Principal Terms................................ 41
PTCE........................................... 79
PTP............................................ 77
PTP Regulations................................ 77
Purchased Participation Receivables............ 23
qualified stated interest...................... 74
Rated Securities............................... 37
Rating Agency.................................. 32
Rebate Payment................................. 60
Receivables.................................... 15
Receivables Purchase Agreement................. 15
Related Documents.............................. 32
Related person................................. 76
Removal and Repurchase Date.................... 57
Removal Commencement Date...................... 56
Removal Date................................... 56
Removal Notice................................. 56
Removed Account................................ 57
Representation Date............................ 50
Repurchased Receivable......................... 58
Repurchased Receivables Purchase Price......... 57
Required Pool Balance.......................... 38
Required Rating................................ 37
Reset Date..................................... 38
Revolving Period............................... 26
SEC............................................ 80
Series Adjusted Invested Amount................ 38
Series Allocable Defaulted Amount.............. 38
Series Allocable Miscellaneous Payments........ 38
Series Allocable Non-Principal Collections..... 38
Series Allocable Principal Collections......... 38
Series Allocation Percentage................... 38
Series Cut-Off Date............................ 50
Series Issuance Date........................... 51
Series Supplement.............................. 25
Series Termination Date........................ 62
Service Transfer............................... 66
Servicer....................................... 14
Servicing Default.............................. 66
Servicing Fee.................................. 65
Servicing Fee Rate............................. 65
Short-Term Note................................ 74
Special Payment Date........................... 26
Standard & Poor's.............................. 34
SuperWRAP Program.............................. 23
Supplemental Certificate....................... 59
Target Available Subordinated Amount........... 38
Tax Counsel.................................... 73
Tax Opinion.................................... 42
Transfer and Servicing Agreements.............. 47
Transfer Date.................................. 51
Transfer Deposit Amount........................ 51
Transferor..................................... 14
Transferor Certificate......................... 59
Trust.......................................... 15
Trust Adjusted Invested Amount................. 39
Trust Agreement................................ 15
Trust Incremental Subordinated Amount.......... 54
Trust Sale and Servicing Agreement............. 16
Underwriting Agreement......................... 79
Vehicles....................................... 15
Wholesale Portfolio............................ 24
World Omni..................................... 14
WOWI........................................... 78
</TABLE>
83
<PAGE>
SUBJECT TO COMPLETION, DATED , 2000
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED , 2000)
$ ,000,000
WORLD OMNI MASTER OWNER TRUST
$ ,000,000 SERIES 200 - [ %][FLOATING RATE] ASSET BACKED NOTES, CLASS A
$ ,000,000 SERIES 200 - [ %][FLOATING RATE] ASSET BACKED NOTES, CLASS B
WODFI LLC, TRANSFEROR
WORLD OMNI FINANCIAL CORP., SERVICER
<TABLE>
<S> <C> <C> <C>
THE TRUST WILL ISSUE THE FOLLOWING CLASSES OF SERIES 200 - NOTES:
BEFORE YOU PURCHASE ANY OF
THE NOTES, YOU SHOULD CLASS A NOTES CLASS B NOTES
CAREFULLY CONSIDER THE RISK
FACTORS BEGINNING ON PAGE Principal Amount............................ $ $
S-8 IN THIS PROSPECTUS Interest Rate............................... % %
SUPPLEMENT AND ON PAGE 9 IN Payment Dates............................... Monthly Monthly
THE PROSPECTUS. Expected Principal Payment Date............. , 200 , 200
Stated Maturity Date........................
The sole source of payments Price to Public............................. % %
on the notes is a portion Underwriting Discount....................... % %
of the assets of the trust. Proceeds to Trust (1)....................... % %
The notes are not interests
in or obligations of World ------------------------------------------
Omni Financial Corp., WODFI
LLC or any other entity or (1) Before deducting expenses which are estimated to be
person. $ . Total price to the public is $ ,
total underwriting discount is $ , and
This prospectus may be used total proceeds to the Trust are $ .
to offer and sell the notes
only if accompanied by the
prospectus.
CREDIT ENHANCEMENT:
o The certificates issued by the Trust are subordinate
to the Series 200 - Notes to the extent of the
available subordinated amount, which is initially
$ .
o A reserve account, with an initial balance of
$ .
o The Class B Notes are subordinated to the Class A
Notes. Subordination of the Class B Notes provides
additional credit enhancement to the Class A Notes.
</TABLE>
This prospectus supplement and the accompanying prospectus relate only to the
offering of the notes. The certificates issued by the trust are not being
offered under this prospectus supplement and the prospectus.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE NOTES OR DETERMINED IF THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Delivery of the notes will be made only in book-entry form through the
facilities of The Depository Trust Company on or about , 2000.
The date of this prospectus supplement is , 2000
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
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
<PAGE>
[Intentionally Left Blank]
S-2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
SECTION PAGE
<S> <C>
WHERE TO FIND INFORMATION IN THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS................... S-4
Limitations on Offers or Solicitations.......... S-4
Transactions That May Affect the Price of the
Series 200 - Notes.............................. S-4
SUMMARY OF TERMS.................................. S-5
The Parties..................................... S-5
The Notes....................................... S-5
Credit Enhancement.............................. S-6
Servicing Fee Rate.............................. S-7
Optional Repurchase............................. S-7
Other Series of Notes........................... S-7
Tax Status...................................... S-7
ERISA Considerations............................ S-7
Ratings......................................... S-7
RISK FACTORS...................................... S-8
USE OF PROCEEDS................................... S-10
THE WHOLESALE PORTFOLIO........................... S-10
Loss Experience................................. S-10
Aging Experience................................ S-11
Geographic Distribution......................... S-11
Dealer Concentration............................ S-12
MATURITY AND PRINCIPAL PAYMENT CONSIDERATIONS..... S-13
SERIES PROVISIONS................................. S-14
General......................................... S-14
<CAPTION>
SECTION PAGE
<S> <C>
Interest........................................ S-14
Principal....................................... S-15
Allocation Percentages.......................... S-17
Allocation of Collections; Limited Subordination
of Certificates.............................. S-17
Distributions from the Collection Account;
Reserve Fund................................. S-18
Available Subordinated Amount................... S-20
Principal Collections........................... S-21
Excess Principal Collections.................... S-21
Distributions................................... S-21
Noteholder Charge-Offs.......................... S-23
Early Amortization Events....................... S-23
Stated Maturity Date............................ S-24
Payment Event of Default........................ S-25
Optional Repurchase............................. S-25
Principal Funding Account....................... S-26
Excess Funding Account.......................... S-26
Reports......................................... S-26
Definitions..................................... S-27
CERTAIN FEDERAL INCOME TAX CONSEQUENCES........... S-33
FLORIDA INCOME TAXATION........................... S-33
ERISA CONSIDERATION............................... S-34
UNDERWRITING...................................... S-34
LEGAL MATTERS..................................... S-35
INDEX OF TERMS.................................... S-36
</TABLE>
S-3
<PAGE>
WHERE TO FIND INFORMATION IN THIS PROSPECTUS SUPPLEMENT
AND THE PROSPECTUS
We provide information to you about your series of the notes in two
separate documents that provide varying levels of detail:
(a) the prospectus, which provides general information, some of which may
not apply to a particular series of notes, including your series.
(b) this prospectus supplement, which provides information regarding the
pool of receivables held by the trust and specifies the terms of your
series
IF THE TERMS OF YOUR SERIES OF NOTES VARY BETWEEN THE PROSPECTUS AND THIS
PROSPECTUS SUPPLEMENT, YOU SHOULD RELY ON THE INFORMATION IN THIS PROSPECTUS
SUPPLEMENT.
You should rely only on the information provided in the prospectus and this
prospectus supplement. We have not authorized anyone to provide you with other
or different information. You should not assume that the information in the
prospectus and this prospectus supplement is accurate on any date other than the
dates stated on their respective covers.
Capitalized terms used in this prospectus supplement are defined either in
this prospectus supplement or in the prospectus. You can find a list of the
pages where capitalized terms used in this prospectus supplement are defined
under the caption 'Index of Terms' which appears at the end of the prospectus
and this prospectus supplement.
LIMITATIONS ON OFFERS OR SOLICITATIONS
We do not intend this document to be an offer or solicitation:
(a) if used in a jurisdiction in which such offer or solicitation is not
authorized;
(b) if the person making the offer or solicitation is not qualified to do
so; or
(c) if the offer or solicitation is made to anyone to whom it is unlawful
to make the offer or solicitation.
TRANSACTIONS THAT MAY AFFECT THE PRICE OF THE SERIES 200 - NOTES
The underwriters may engage in transactions that stabilize, maintain, or
otherwise affect the price of the Series 200 - Notes. Such transactions may
include stabilizing and the purchase of the notes to cover syndicate short
positions. For a description of these activities, see 'Underwriting.'
S-4
<PAGE>
SUMMARY OF TERMS
This summary highlights selected information from this prospectus
supplement and provides an overview to aid in your understanding of the Series
200 - Notes. It does not contain all the information that you need to consider
in making an investment decision. To understand all of the terms of the notes,
you should carefully read this prospectus supplement and the accompanying
prospectus.
THE PARTIES
Trust / Issuer
World Omni Master Owner Trust, a Delaware business trust formed by
WODFI LLC as Transferor and Chase Manhattan Bank Delaware as Owner Trustee
Transferor
WODFI LLC, a wholly-owned subsidiary of World Omni Financial Corp.
Servicer
World Omni Financial Corp., a wholly-owned subsidiary of JM Family
Enterprises, Inc.
Indenture Trustee
Harris Trust and Savings Bank
Owner Trustee
Chase Manhattan Bank Delaware
Administrator
World Omni Financial Corp.
THE NOTES
The trust will issue the following classes of Series 200 - Notes:
<TABLE>
<CAPTION>
AGGREGATE
INTEREST PRINCIPAL
CLASS RATE AMOUNT
- ------------------------- -------- ------------------
<S> <C> <C>
Class A Notes............ % $
Class B Notes............ % $
</TABLE>
The sole source of payments on the Series 200 - Notes is a portion of the
assets of the trust. The Series 200 - Notes are not interests in or
obligations of World Omni, the Transferor or any other entity or person. The
trust has previously issued other series of notes. A summary of each
outstanding series of notes is contained in 'Annex I-- Outstanding Series of
Notes' at the end of this prospectus. The trust has also issued certificates.
The certificates are not being offered for sale by this prospectus supplement
and are currently held by the Transferor. The trust may issue additional
series of notes and additional certificates.
Series Issuance Date
, 2000.
Series Cut-Off Date
, 2000.
Payment Dates
Payments on the Series 200 - Notes will generally be made on the 15th
day of each month or, if such day is not a business day, on the next
succeeding business day.
Interest Payments
The interest rate for each class of the Series 200 - Notes is as
follows:
Class A Notes: [ %][LIBOR plus % or, if lower, the Assets
Receivables Rate described in this prospectus supplement.]
Class B Notes: [ %][LIBOR plus % or, if lower, the Assets
Receivables Rate.]
The trust will pay interest on the Series 200 - Notes on each Payment
Date beginning on , 2000 for the period from the prior Payment
Date or, in the case of the first Payment Date, from the Series Issuance Date
to the day prior to the Payment Date. Interest will be calculated on the basis
of [a 360-day
S-5
<PAGE>
year of twelve 30-day months][the actual number of days divided by 360].
The payment of interest on the Class B Notes is subordinate to the
payment of interest on the Class A Notes. No interest will be paid on the
Class B Notes on any Payment Date unless all interest due and payable on the
Class A Notes has been paid.
Principal Payments
The entire principal balance of the Class A Notes and the Class B
Notes is expected to be paid on , 200 .
However, special circumstances could cause principal to be paid
earlier or later or in reduced amounts. See 'Maturity and Principal Payment
Considerations.'
If not previously paid, the outstanding principal amount of the Class
A Notes and the Class B Notes will be payable in full on their stated final
maturity dates as follows:
Class A Notes
Class B Notes
The payment of principal on the Class B Notes is subordinate to the
payment of principal on the Class A Notes. No principal will be paid on the
Class B Notes until the Class A Notes have been paid in full.
Revolving Period
The Series 200 - Notes will have a Revolving Period that will begin at
the close of business on the Series Cut-Off Date and end when the Accumulation
Period for the Series 200 - Notes begins. The Revolving Period will also end
if an Early Amortization Period that is not terminated begins.
Accumulation Period
The Series 200 - Notes will have an Accumulation Period, unless an
Early Amortization Period that is not terminated begins before the start of
the Accumulation Period. The Accumulation Period will be a period of one to
three months long. No principal payments will be made on the Series 200 -
Notes during the Accumulation Period.
Early Amortization Period
The Series 200 - Notes may have an Early Amortization Period if an
Early Amortization Event occurs and is not cured. See 'The Transfer and
Servicing Agreements--Investment Events and Early Amortization Events' in the
prospectus and 'Series Provision--Early Amortization Events' in this
prospectus supplement for a description of the events that might cause an
Early Amortization Period to start and, in some cases, terminate. During an
Early Amortization Period, principal payments will be made on the Series
200 - Notes to the extent of funds available for that purpose.
CREDIT ENHANCEMENT
Subordination of the Certificates
The Certificates are subordinated to the rights of the holders of
Series 200 - Notes to the extent described in this prospectus supplement.
Collections on the Receivables otherwise allocable to the Certificates may be
used to pay interest and principal on the Series 200 - Notes but only to the
extent of the Available Subordinated Amount.
The Available Subordinated Amount will initially be $ but is
subject to reduction from time to time. See 'Series Provisions-- Allocation of
Collections; Limited Subordination of Certificates' for more information about
the Available Subordinated Amount.
The portion of the assets of the Trust securing the Series 200 - Notes
and the portion of collections from those assets allocated to the Series
200 - Notes will be based on the sum of the Available Subordinated Amount and
the Invested Amount. The Invested Amount will initially be $ but is
subject to reduction from time to time as described in this prospectus
supplement under the caption 'Series Provisions--Allocation Percentages.'
S-6
<PAGE>
Reserve Account
A Reserve Fund will be established and maintained in the name of the
Indenture Trustee for the benefit of the holders of the Series 200 - Notes. On
the Series Issuance Date, the trust will deposit $ into the Reserve Fund.
The Reserve Fund Required Amount for any Payment Date will equal 0.50% of the
outstanding principal balance of the Series 200 - Notes for such Payment Date,
after giving effect to any change in the principal balance on such Payment
Date.
Amounts on deposit in the Reserve Fund will be available to pay
Monthly Interest, the Monthly Servicing Fee and Noteholder Default Amounts.
[In addition, on the stated maturity date for a class of notes or on the date
on which the principal amount of the notes has been reduced to zero, amounts
on deposit in the Reserve Fund will be available to pay Carry-over Amounts for
that class of notes.]
Excess Principal Collections
Principal Collections allocable to other series of Notes, to the
extent not needed to make payments on such other series of Notes, will be
applied to make principal payments on the Series 200 - Notes and on other
series of notes entitled to principal payments.
Subordination of Class B Notes
The Class B Notes will be subordinated to the rights of the Class A
Notes to the extent described in this prospectus supplement.
SERVICING FEE RATE
The trust will pay the Servicer a monthly 1.0% per annum servicing fee as
compensation for servicing the receivables.
OPTIONAL REPURCHASE
The Series 200 - Notes are subject to optional repurchase by the Servicer
on any Payment Date after the outstanding principal amount of the Series
200 - Notes is reduced to $ or less.
OTHER SERIES OF NOTES
The trust may issue additional series of notes.
TAX STATUS
Kirkland & Ellis, special tax counsel, is of the opinion that, for
federal income tax purposes, the notes will be characterized as indebtedness
and the trust will not be characterized as an association (or publicly traded
partnership) taxable as a corporation.
By accepting a note, you agree to treat the notes as indebtedness for
federal, state and local income and franchise tax purposes.
See 'Certain Federal Income Tax Consequences' concerning the application
of federal, state and local tax laws.
ERISA CONSIDERATIONS
Subject to the considerations discussed under 'ERISA Considerations,' an
employee benefit plan regulated by the Employee Retirement Income Security Act
of 1974 may purchase the notes, including any subordinated notes. See 'ERISA
Considerations' for a description of the limitations on purchases of notes by
employee benefit plans. An employee benefit plan should consult with its
counsel before purchasing any notes.
RATINGS
The notes will not be issued unless:
o the Class A Notes are rated in the highest rating category for
long-term debt obligations by at least one nationally recognized
rating agency, and
o the Class B Notes are rated in at least the 'A' category or its
equivalent for long-term debt obligations by at least one nationally
recognized rating agency.
[The rating agencies do not evaluate and their rating does not address
the likelihood that any Class A Carry-over Amount or Class B Carry-over Amount
will be paid.]
S-7
<PAGE>
RISK FACTORS
In addition to the risk factors on page 9 of the prospectus, you should
consider the following risk factors in deciding whether to purchase the notes.
<TABLE>
<S> <C>
CLASS B NOTES ARE SUBJECT TO GREATER The Class B Notes bear greater credit risk than the Class A Notes because
CREDIT RISK BECAUSE THE CLASS B NOTES payments of interest on the Class B Notes are subordinated in priority to the
ARE SUBORDINATED TO THE CLASS A NOTES payment of interest due on the Class A Notes and payments of principal on the
Class B Notes will not be made until the Class A Notes have been paid in full.
This subordination could result in delays or reductions in the payment of
principal and interest on the Class B Notes.
DEPENDENCE ON OTHER SERIES' ALLOCATED The shorter the Accumulation Period for the Series 200 - Notes, the greater
PRINCIPAL COLLECTIONS MAY RESULT IN the chance that payment in full of the Series 200 - Notes on the expected
LATE PAYMENT OF SERIES 200 - NOTE principal payment date will depend on principal collections initially
PRINCIPAL allocated to another series of notes being available to make principal
payments on the Series 200 - Notes. A series of notes from which principal
collections were expected to be available to make payments on the Series
200 - Notes may enter an early amortization period or investment period after
the beginning of the accumulation period for the Series 200 - Notes. If that
were to occur, excess principal collections from that series that otherwise
would have been available to the Series 200 - Notes would not be available. As
a result, the final payment of principal of the Series 200 - Notes may be
later than the expected principal payment date. On written request, the
Transferor will give Series 200 - Noteholders disclosure documents relating to
any other outstanding series of notes. Those documents describe the events
which could result in the start of an early amortization period or investment
period for those series.
See 'The Dealer Floorplan Financing Business' in the prospectus and 'Maturity
and Principal Payment Considerations' and 'Series Provisions--Early
Amortization Events' in this prospectus supplement for more information about
the timing of payments on the Series 200 - Notes.
EARLY AMORTIZATION OF SERIES 200 - A significant decline in the amount of Receivables generated could cause an
NOTES MAY RESULT IN EARLY, LATE AND/OR Early Amortization Event. If the Pool Balance is not maintained at a specified
REDUCED PAYMENT OF SERIES 200 - NOTES level, World Omni must designate additional Accounts, the Receivables of which
will be sold to the Transferor. The Transferor will be required to transfer
those Receivables to the Trust. If additional Accounts are not designated by
World Omni when required, an Early Amortization Period will begin and could
result in payment of the Series 200 - Notes prior to the Expected Principal
Payment Date and/or reduced payment of the Series 200 - Notes. In certain
cases, however, the resulting Early Amortization Period may end and the
Revolving Period will start again. In addition, if certain events occur, an
Early Amortization Period will begin and could also result in payment of the
Series 200 - Notes before or after the Expected Principal Payment Date and/or
reduced payment of the Series 200 - Notes.
</TABLE>
S-8
<PAGE>
<TABLE>
<S> <C>
[THE CLASS A NOTE RATE AND CLASS B NOTE The 'Assets Receivables Rate' is based on the interest rates on the
RATE ARE LIMITED BY THE ASSETS Receivables and investment earnings on amounts on deposit in certain accounts
RECEIVABLES RATE of the trust. If the interest rate on the Class A Notes or the Class B Notes,
which is based on LIBOR, exceeds the Assets Receivables Rate, then the
interest rate on the Class A Notes or the Class B Notes, as applicable, will
be adjusted to equal the Assets Receivables Rate.]
[THE TRUST MAY NOT BE ABLE TO MAKE UP A The interest rates on the Class A Notes and the Class B Notes are based on
DEFICIENCY IN INTEREST PAYMENTS IF THE LIBOR and may exceed the Assets Receivables Rate as a result of LIBOR
CLASS A NOTE OR CLASS B NOTE INTEREST exceeding the interest rate on the Receivables (which may be reduced by the
RATE IS HIGHER THAN THE ASSETS Servicer) and/or LIBOR exceeding the investment earnings on amounts, if any,
RECEIVABLES RATE on accounts of the trust in which principal collections are held. Any
deficiency in interest payments resulting from the Assets Receivables Rate
being lower than the interest rate based on LIBOR and interest on such
deficiency will be paid to the extent of:
o any funds remaining after all required distributions and deposits for the
Series 200 - Notes have been made; and
o on the last payment date for Series 200 - , certain amounts in the Reserve
Account and Additional Noteholder Collections.
The Transferor cannot assure that those amounts, if any, will be sufficient to
pay such deficiency. If any such deficiency is outstanding for Payment
Dates in a row, an Early Amortization Event will occur.]
CREDIT ENHANCEMENT IS LIMITED AND MAY Credit enhancement of the Series 200 - Notes will be provided by the
BE REDUCED. subordination of the Certificates to the extent of the Available Subordinated
Amount as described in this prospectus supplement and by amounts in the
Reserve Account. In addition, the Class B Notes are subordinated to the Class
A Notes to the extent described in this prospectus supplement. The amount of
such credit enhancement is limited and will be reduced from time to time. See
'Series Provisions--Allocation of Collections; Limited Subordination of
Certificates' for more information about credit enhancement for the Series
200 - Notes.
LIMITED ABILITY TO RESELL NOTES The underwriters may assist in the resale of the Series 200 - Notes, but they
are not required to do so. A trading market for the Series 200 - Notes may not
develop. If a trading market does develop, it might not continue or it might
not be sufficiently liquid to allow you to resell any of your Series 200 -
Notes.
</TABLE>
S-9
<PAGE>
USE OF PROCEEDS
After making the deposits to the Reserve Account described in this
prospectus supplement, $ million of the net proceeds from the sale of the
Series 200 - Notes will be used to repay a portion of the Series 1999-VFN Note
currently outstanding. The trust issued the $600 million Series 1999-VFN Note on
November 22, 1999, in connection with the formation of the trust. The Series
1999-VFN has a floating rate of interest based on commercial paper issued by the
holder of the Series 1999-VFN Note. As of , 2000, the Series
1999-VFN Note has an effective interest rate of % per annum. The net
proceeds of the issuance of the Series 1999-VFN Note were distributed by the
trust to the Transferor in connection with the Transferor's transfer of
receivables to the trust, and were used to acquire receivables and to repay
$ million of floating rate indebtedness financing those receivables. As of
November 23, 1999, that indebtedness had an interest rate of % per
annum.
THE WHOLESALE PORTFOLIO
As of September 30, 1999, there were approximately 239 Dealers with active
credit lines in the Wholesale Portfolio, and with respect to the Accounts in the
Wholesale Portfolio:
o there were 76 active Southeast Toyota Distributors Dealer Accounts and
163 active non-Southeast Toyota Distributors Dealer Accounts;
o the average credit line per Account was $4.7 million; the average
principal balance of Receivables per Account was $2.9 million;
o the aggregate total principal balance of Receivables as a percentage of
the aggregate total credit line was approximately 62.5%;
o the weighted average spread over the prime rate charged to Dealers was
0.21%; and
o the weighted average spread over LIBOR charged to Dealers was 2.04%.
There can be no assurance that the experience of the Accounts set forth in the
tables below under '--Loss Experience,' '--Aging Experience,' '--Geographic
Distribution' and '--Dealer Concentration' in the future will be similar to the
historical experience set forth below.
Because the Accounts from which Receivables are transferred to the Trust
(the 'POOL OF ACCOUNTS') are only a portion of the Wholesale Portfolio, actual
experience with respect to such Accounts may be different from that of the
Wholesale Portfolio. Because such Accounts are selected from the Wholesale
Portfolio in a manner not adverse to Noteholders and represent a sizeable
portion of the Wholesale Portfolio, the Transferor believes that the performance
of the Wholesale Portfolio reflected in the following tables is indicative of
the historical performance of the Accounts being transferred to the Trust.
Historical loss experience, aging experience and geographic distribution with
respect to the Accounts being transferred to the Trust may be different from
that of the Wholesale Portfolio in the future.
LOSS EXPERIENCE
The following tables set forth World Omni's average principal receivables
balance and loss experience for each of the periods shown with respect to the
Wholesale Portfolio. Losses occur on Receivables when a Dealer has been
terminated under circumstances in which the Dealer has sold one or more Vehicles
to a retail customer and has failed to remit the appropriate proceeds of such
sale to World Omni. Losses also occur when used Vehicles financed at wholesale
and repossessed by World Omni from a terminated Dealer cannot be sold for the
balance due on the related Receivables. By contrast, losses generally have not
occurred when new Vehicles financed by World Omni are repossessed from
terminated Dealers, because such new Vehicles will generally be returned to the
manufacturers or distributors for a purchase price which generally covers the
balance due on the related Receivables. World Omni recognizes losses on
Receivables at the time it deems such Receivables to be uncollectible
S-10
<PAGE>
(which is generally at the time it has exhausted all non-legal remedies).
Because the Eligible Accounts may be only a portion of the entire portfolio,
actual loss experience with respect to the Eligible Accounts may be different.
There can be no assurance that the loss experience for the Receivables in
the future will be similar to the historical experience set forth below with
respect to the Wholesale Portfolio. In addition, a significant portion of the
Receivables are from Southeast Toyota Distributors-franchised dealers.
LOSS EXPERIENCE FOR THE WHOLESALE PORTFOLIO
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
--------------- --------------------------------------
1999 1998 1998 1997 1996 1995 1994
------ ------ ------ ----- ----- ----- -----
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
Average Principal Balance of Receivables (1)............. 751.2 711.6 694.3 623.9 495.4 391.9 339.4
Net Losses (Recoveries) (2).............................. 1.25 3.0 4.8 0 0 0 0
Net Losses/Average Principal Balance of
Receivables (3)........................................ 0.17 0.42 0.69 0 0 0 0
</TABLE>
- ------------------
(1) Average Principal Balance of Receivables is the average of the monthly
average principal balances (based on beginning and ending month balances)
for the twelve months ending on the last day of the period, except for the
periods ended September 30, 1999 and September 30, 1998, each of which is
based on a nine month average.
(2) Net losses in any period are gross losses less recoveries for such period.
Recoveries include recoveries from Collateral Security in addition to the
Vehicle. Losses do not include losses with respect to certain Accounts
guaranteed by Southeast Toyota Distributors.
(3) Percentages for the nine month periods ended September 30, 1999 and
September 30, 1998 are expressed on an annualized basis.
AGING EXPERIENCE
The following table provides the age distribution of Vehicle inventory for
all Dealers in the Wholesale Portfolio, as a percentage of total principal
outstanding at the date indicated. Because the Eligible Accounts may only be a
portion of the entire Wholesale Portfolio, actual age distribution with respect
to the Eligible Accounts may be different.
AGE DISTRIBUTION FOR THE WHOLESALE PORTFOLIO
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
DAYS 1999 1998
- ----------------------------------------------------------- ------------- ------------
<S> <C> <C>
1-120...................................................... 88.23 88.81
121-180.................................................... 5.70 6.20
Over 180................................................... 6.07 4.98
</TABLE>
The average payoff rate in the Wholesale Portfolio is described under
'Maturity and Principal Payment Considerations.'
GEOGRAPHIC DISTRIBUTION
The following table provides the geographic distribution of the vehicle
inventory for all Dealers in the Wholesale Portfolio. As of September 30, 1999,
approximately 20.8% of Receivables in the Wholesale Portfolio arose in the State
of Florida.
S-11
<PAGE>
GEOGRAPHIC DISTRIBUTION OF ACCOUNTS IN THE WHOLESALE PORTFOLIO
AS OF SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
PERCENTAGE OF
RECEIVABLES RECEIVABLES NUMBER OF PERCENTAGE OF
OUTSTANDING OUTSTANDING VEHICLES TOTAL VEHICLES
----------- ------------- --------- --------------
<S> <C> <C> <C> <C>
Alabama...................................................... 20,758,764 2.96% 1,033 2.96%
Arkansas..................................................... 15,867,650 2.26% 712 2.04%
California................................................... 10,398,907 1.48% 795 2.28%
Colorado..................................................... 1,673,883 0.24% 116 0.33%
Connecticut.................................................. 13,162,121 1.88% 610 1.75%
Florida...................................................... 145,268,018 20.74% 7,901 22.65%
Georgia...................................................... 88,542,082 12.64% 4,340 12.44%
Illinois..................................................... 6,384,523 0.91% 348 1.00%
Indiana...................................................... 4,107,222 0.59% 285 0.82%
Massachusetts................................................ 36,120,406 5.16% 1,792 5.14%
Maryland..................................................... 3,838,805 0.55% 127 0.36%
Mississippi.................................................. 4,319,795 0.62% 216 0.62%
North Carolina............................................... 68,296,348 9.75% 3,532 10.13%
New Hampshire................................................ 24,393,466 3.48% 1,204 3.45%
New Jersey................................................... 6,793,121 0.97% 171 0.49%
New York..................................................... 67,247,226 9.60% 2,969 8.51%
Ohio......................................................... 54,009,903 7.71% 2,668 7.65%
Oregon....................................................... 1,367,544 0.20% 91 0.26%
Pennsylvania................................................. 11,333,496 1.62% 466 1.34%
Rhode Island................................................. 4,733,981 0.68% 219 0.63%
South Carolina............................................... 15,340,548 2.19% 835 2.39%
Tennessee.................................................... 2,305,650 0.33% 173 0.50%
Texas........................................................ 27,270,418 3.89% 860 2.47%
Virginia..................................................... 64,183,564 9.16% 3,242 9.30%
Vermont...................................................... 1,211,669 0.17% 65 0.19%
Washington................................................... 1,631,177 0.23% 106 0.30%
Total...................................................... 700,560,288 100.00% 34,876 100.00%
</TABLE>
DEALER CONCENTRATION
The following table provides information with respect to the concentration
of Receivables relating to certain Dealers as of September 30, 1999. The
Accounts described below (identified by Dealer group code, which includes each
Dealer and its affiliates under common ownership and control) constitute all
Accounts with at least 2% or more of the outstanding Wholesale Portfolio as of
September 30, 1999. The amount set forth under the column entitled 'Receivables
Outstanding' has not been reduced by the amount of Floorplan equity deposits on
hand as of September 30, 1999.
S-12
<PAGE>
DEALER CONCENTRATION FOR THE WHOLESALE PORTFOLIO
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999
----------------------------------
RECEIVABLES PERCENTAGE OF TOTAL
DEALER GROUP CODE OUTSTANDING RECEIVABLES
- ------------------------------------------------------------------------------------- ----------- -------------------
<S> <C> <C>
82................................................................................... 54,249,343 7.74%
58................................................................................... 52,828,487 7.54%
15................................................................................... 37,952,111 5.42%
12................................................................................... 31,749,907 4.53%
71................................................................................... 30,191,910 4.31%
111.................................................................................. 27,270,418 3.89%
22................................................................................... 24,433,917 3.49%
01................................................................................... 21,675,624 3.09%
13................................................................................... 19,201,415 2.74%
11................................................................................... 17,357,221 2.48%
30................................................................................... 17,090,523 2.44%
109.................................................................................. 15,867,650 2.26%
45................................................................................... 15,753,663 2.25%
104.................................................................................. 15,148,615 2.16%
</TABLE>
MATURITY AND PRINCIPAL PAYMENT CONSIDERATIONS
Full payment of the Series 200 - Notes by the Payment Date (the
'EXPECTED PRINCIPAL PAYMENT DATE') depends in large part on repayment by Dealers
of the Receivables. Timely payment on the Notes may not occur if Dealer payments
are insufficient. Because the Receivables generally are paid upon retail sale of
the underlying Vehicle, the timing of Receivable payments is uncertain. In
addition, there is no assurance that World Omni will generate additional
Receivables under the Accounts or that any particular pattern of Dealer payments
will occur. In addition, the shorter the Accumulation Period Length, the greater
the likelihood that payment of the Class A Notes or the Class B Notes in full by
the Expected Principal Payment Date may be dependent on the reallocation of
Principal Collections from other outstanding series of notes. If one or more
other series from which Principal Collections are expected to be reallocated to
pay the Series 200 - Notes enters into an early amortization period or
investment period after the start of the Accumulation Period for the Series
200 - Notes, Principal Collections allocated to such series generally will not
be reallocated to pay principal of the Series 200 - Notes. In such a case, the
final payment of principal of the Series 200 - Notes may be later than the
Expected Principal Payment Date.
Principal for the Series 200 - Notes will be payable if an Early
Amortization Period that is not terminated has commenced. Because an Early
Amortization Event for the Series 200 - Notes may occur and initiate an Early
Amortization Period, the final distribution of principal on the Class A Notes
and the Class B Notes may be made prior to the scheduled termination of the
Revolving Period or prior to the Expected Principal Payment Date.
The amount of new Receivables generated in any month and monthly payment
rates on the Receivables may vary because of seasonal variations in Vehicle
sales and inventory levels, retail incentive programs provided by Vehicle
manufacturers and various economic factors affecting Vehicle sales generally.
The following table sets forth the highest and lowest monthly payment rates for
the Wholesale Portfolio during any month in the periods shown and the average of
the monthly payment rates for all months during the periods shown. In each case
the data is calculated as the percentage equivalent of a fraction, the numerator
being the aggregate of all collections of principal during the period and the
denominator being the average aggregate principal balance for such period.
Monthly
S-13
<PAGE>
payment rates reflected in the table include principal credit adjustments. There
can be no assurance that the rate of Principal Collections will be similar to
the historical experience set forth below. As the Eligible Accounts will be only
a portion of the entire Wholesale Portfolio, historical monthly payment rates
for the Eligible Accounts may be different than those shown below.
MONTHLY PAYMENT RATES FOR THE WHOLESALE PORTFOLIO
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
-------------- -----------------------------------------
1999 1998 1998 1997 1996 1995 1994
----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C>
Highest Month........................................... 76.05% 77.29% 77.29% 71.21% 78.79% 61.60% 70.81%
Lowest Month............................................ 57.74 53.10 53.10 51.05 50.69 45.85 46.28
Average of the Months in the Period..................... 66.82 64.65 63.77 61.52 61.18 54.82 58.76
</TABLE>
SERIES PROVISIONS
GENERAL
The Series 200 - Notes will be issued pursuant to the Indenture and a
Series Supplement to the Indenture for the Series 200 - Notes (the 'SERIES
SUPPLEMENT'). The Transferor will provide a copy of the Indenture and the Series
Supplement (each without exhibits) upon request of a Noteholder. The following
summary does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, all of the provisions of the Series 200 - Notes,
the Indenture and the Series Supplement. Where particular provisions or terms
used in the Indenture or the Series Supplement are referred to, the actual
provisions, including definitions of terms, are incorporated by reference as
part of this summary. You should see the prospectus for additional information
about the Series 200 - Notes and the Indenture.
The Series 200 - Notes will consist of two classes, the Class A Notes and
the Class B Notes. The Series 200 - Notes will be offered in minimum
denominations of $1,000 and integral multiples of $1,000.
INTEREST
Interest on the principal balance of the Class A Notes and the Class B
Notes will accrue at the Class A Note Rate and the Class B Note Rate,
respectively, and will be payable to the holders of the Class A Noteholders (the
'CLASS A NOTEHOLDERS') and to the holders of the Class B Notes (the 'CLASS B
NOTEHOLDERS' and, together with the Class A Noteholders, the 'SERIES 200 -
NOTEHOLDERS') on each Payment Date, commencing , 2000. Interest payable
on any Payment Date will accrue from and including the preceding Payment Date to
but excluding such Payment Date (or, in the case of the first Payment Date, from
and including the Series Issuance Date to but excluding the first Payment Date)
(each, an 'INTEREST PERIOD'). Interest will be calculated on a basis of [a
360-day year of twelve 30-day months][the actual number of days in each Interest
Period divided by 360]. Interest due for any Payment Date but not paid on such
Payment Date will be due on the next Payment Date, together with interest on
such amount at the applicable Note Rate [calculated on the basis of LIBOR], to
the extent permitted by applicable law. Interest payments on the Series 200 -
Notes will generally be derived from Noteholder Non-Principal Collections for a
Collection Period, any withdrawals from the Reserve Fund, Investment Proceeds
and, under certain circumstances, Additional Noteholder Collections to the
extent of the Available Subordinated Amount.
S-14
<PAGE>
[The Class A Note Rate and the Class B Note Rate for each Interest Period
will be determined on the LIBOR Determination Date preceding such Interest
Period]. The 'CLASS A NOTE RATE' will be equal to [ % per annum][the lesser
of (a) LIBOR plus % and (b) the Assets Receivables Rate for the related
Payment Date]. The 'CLASS B NOTE RATE' will be equal to [ % per annum][the
lesser of (a) LIBOR plus % and (b) the Assets Receivables Rate for the
related Payment Date]. The Class A Note Rate and the Class B Note Rate are each
referred to as a 'NOTE RATE.'
[If the Class A Note Rate or the Class B Note Rate for a Payment Date
calculated on the basis of LIBOR as described above is greater than the Assets
Receivable Rate, then the Note Rate for such Payment Date and such class will be
the Assets Receivables Rate.]
[If the Class A Note Rate or the Class B Note Rate for any Payment Date is
based on the Assets Receivables Rate, the excess of (a) the amount of interest
on the Class A Notes or the Class B Notes, as the case may be, that would have
accrued in respect of the related Interest Period had interest on that Class
been calculated based on LIBOR over (b) the amount of interest on the Class A
Notes or the Class B Notes, as the case may be, actually accrued in respect of
such Interest Period based on the Assets Receivables Rate (such excess, together
with the unpaid portion of any such excess from prior Payment Dates (and
interest accrued thereon calculated on the basis of LIBOR), is referred to as
the 'CLASS A CARRY-OVER AMOUNT' or the 'CLASS B CARRY-OVER AMOUNT,' as
applicable, and together as the 'CARRY-OVER AMOUNT'), will be paid on such
Payment Date to the extent funds are allocated and available therefor after
making all required distributions and deposits with respect to the Series 200 -
Notes, including payments with respect to principal (including deposits to the
Excess Funding Account), Monthly Interest, the Monthly Servicing Fee, the
Reserve Fund Deposit Amount and the Noteholder Default Amount, as described
below under '--Distributions from the Collection Account; Reserve Fund.' In
addition, any Class A Carry-over Amount outstanding on the Class A Stated
Maturity Date and any Class B Carry-over Amount outstanding on the Class B
Stated Maturity Date, after making the distributions described in the preceding
sentence, will be paid on such Class A Stated Maturity Date or Class B Stated
Maturity Date, as applicable, from certain amounts on deposit in the Reserve
Fund (to the extent such amounts would otherwise be available to the
Certificateholders) and Additional Noteholder Collections on deposit in the
Collection Account (to the extent such amounts would otherwise be available to
the Certificateholder) as described under '--Distributions from the Collection
Account; Reserve Fund.' The ratings of the Series 200 - Notes do not address the
likelihood of payment of any Carry-over Amount.]
PRINCIPAL
In general, no principal payments will be made to the Series 200 -
Noteholders until the earlier of the Expected Principal Payment Date and the
first Special Payment Date after the commencement of an Early Amortization
Period. On each Payment Date with respect to the Revolving Period, collections
of Principal Receivables will either be (a) allocated to one or more other
series of notes which are in amortization, early amortization or accumulation
periods to cover principal payments due to the Noteholders of any such series or
which provides for excess funding accounts or similar arrangements; (b)
deposited into the Excess Funding Account or (c) if no such series is then
amortizing or accumulating principal or otherwise does not provide for excess
funding accounts or similar arrangements, paid to the Certificateholders. See
'--Allocation Percentages--Principal Collections for all Series' and
'--Distributions from the Collection Account; Reserve Fund--Principal
Collections.'
The 'REVOLVING PERIOD' shall mean the period beginning at the close of
business on the Series Cut- Off Date and terminating on the earlier of (a) the
close of business on the day immediately preceding the Accumulation Period
Commencement Date and (b) the close of business on the day an Early Amortization
Period commences; provided, however, that the Revolving Period may recommence
S-15
<PAGE>
in certain circumstances upon the termination of an Early Amortization Period.
See '--Early Amortization Events.'
Unless an Early Amortization Period that is not terminated as described
herein shall have commenced, the Series 200 - Notes will have an Accumulation
Period (the 'ACCUMULATION PERIOD') of one to three months long as described in
the following paragraph.
On the Payment Date and each Payment Date thereafter that occurs
prior to the Accumulation Period Commencement Date, the Servicer shall calculate
the Accumulation Period Length. The 'ACCUMULATION PERIOD LENGTH' will be
calculated on each such date as the lesser of (1) the number of full Collection
Periods between such Payment Date and the Expected Principal Payment Date and
(2) the product, rounded upwards to the nearest integer not greater than three,
of (a) one divided by the lowest Monthly Payment Rate on the Receivables during
the last 12 months and (b) a fraction, the numerator of which is the sum of (1)
the Invested Amount as of such Payment Date (after giving effect to all changes
therein on such date) and (2) the invested amounts of all other series
(excluding certain series) currently in their amortization or accumulation
periods or expected to be in their amortization or accumulation periods by the
Expected Principal Payment Date and the denominator of which is the sum of the
Invested Amount and the invested amounts as of such Payment Date (after giving
effect to all changes therein on such date) of all other outstanding series
(excluding certain series) which are scheduled to be outstanding on the Expected
Principal Payment Date.
The 'ACCUMULATION PERIOD COMMENCEMENT DATE' (which will be the first day of
a Collection Period) will occur when the number of full Collection Periods
remaining until the Expected Principal Payment Date first equals the
Accumulation Period Length as calculated above and shall not thereafter be
changed except as described in the following sentence. In addition, if at any
time after the Payment Date, any other outstanding series (excluding
certain series) shall have entered into an investment period or an early
amortization period, the Accumulation Period Commencement Date shall be the
earlier of (1) the date that such outstanding series shall have entered into its
investment period or early amortization period and (2) the Accumulation Period
Commencement Date as previously determined.
The calculation described above will result in a (1) shorter Accumulation
Period in the event of increases in the principal payment rate and (2) longer
Accumulation Period in the event other series shall have entered into an
investment period or early amortization period.
Unless and until an Early Amortization Period that is not terminated as
described herein shall have occurred and until the outstanding principal balance
of the Class A Notes is paid in full, on each Deposit Date with respect to the
Accumulation Period, collections of Principal Receivables allocable to Series
200 - Noteholders will no longer be paid for the benefit of another series or
the Certificateholders as described above but instead an amount thereof up to
the Class A Controlled Deposit Amount for the Payment Date related to the
Collection Period in which such Deposit Date falls will be deposited in the
Principal Funding Account. On the last day of the Revolving Period, the Series
200 - share of amounts in the Excess Funding Account will be deposited in the
Principal Funding Account. The funds deposited in the Principal Funding Account
will be used to pay the outstanding principal balance of the Class A Notes on
the Expected Principal Payment Date. If on such date the Principal Funding
Account Balance is less than the outstanding principal balance of the Class A
Notes, the Early Amortization Period will commence and on each Special Payment
Date the Class A Noteholders will receive distributions with respect to
principal until the outstanding principal balance of the Class A Notes has been
paid in full or the Class A Stated Maturity Date has occurred. Even if the
Principal Funding Account Balance on the Expected Principal Payment Date is
insufficient to pay the outstanding principal balance of the Class A Notes in
full, such amounts will be distributed to the Class A Noteholders at such time.
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Unless and until an Early Amortization Period that is not terminated as
described herein shall have occurred and until the outstanding principal balance
of the Class B Notes is paid in full, on each Deposit Date with respect to the
Accumulation Period, collections of Principal Receivables allocable to Series
200 - Noteholders will no longer be paid for the benefit of another series or to
the Certificateholders as described above but instead an amount thereof up to
the Class B Controlled Deposit Amount for the Payment Date related to the
Collection Period in which such Deposit Date falls will be deposited in the
Principal Funding Account. The funds deposited in the Principal Funding Account
remaining after payment of the Class A Notes will be used to pay the outstanding
principal balance of the Class B Notes on the Expected Principal Payment Date.
If on such date the Principal Funding Account Balance remaining after payment of
the Class A Notes is less than the outstanding principal balance of the Class B
Notes, the Early Amortization Period will commence and on each Special Payment
Date the Class B Noteholders will receive distributions with respect to
principal until the outstanding principal balance of the Class B Notes has been
paid in full or the Class B Stated Maturity Date has occurred. Even if the
Principal Funding Account Balance remaining after payment of the Class A Notes
on the Expected Principal Payment Date is insufficient to pay the outstanding
principal balance of the Class B Notes in full, such balances will be
distributed to the Class B Noteholders at such time.
It is expected that the final principal payment with respect to the Class A
Notes and the Class B Notes will be made on the Expected Principal Payment Date.
However, principal of the Class A Notes or the Class B Notes may be paid earlier
or, depending on the actual payment rate on the Receivables, later, as described
under 'Risk Factors--Timing of Payments' herein and 'Risk Factors--Payments' in
the prospectus.
ALLOCATION PERCENTAGES
The Servicer will allocate amounts initially allocated to Series 200 - as
described under 'The Notes -- Allocation Percentages--Allocations among Series'
in the prospectus between the Series 200 - Noteholders and the
Certificateholders for each Collection Period as follows:
(1) Series Allocable Non-Principal Collections and the Series Allocable
Defaulted Amount will be allocated to Series 200 - Noteholders based
on the Floating Allocation Percentage;
(2) during the Revolving Period, Series Allocable Principal Collections
will be treated as Excess Principal Collections based on the Floating
Allocation Percentage;
(3) during the Accumulation Period and any Early Amortization Period,
Series Allocable Principal Collections will be allocated to Series
200 - Noteholders based on the Principal Allocation Percentage; and
(4) Series Allocable Miscellaneous Payments will be treated as Series
Allocable Principal Collections; provided, however, that Series
Allocable Miscellaneous Payments consisting of the amount of
Adjustment Payments that (1) were paid after their due date and (2)
have been included in the Monthly Dilution Amount for any prior
Collection Period will be treated as Series Allocable Non- Principal
Collections.
Amounts not allocated to the Series 200 - Noteholders as described above
will be allocated to the Certificateholders but certain portions thereof may be
available to pay the Noteholders.
ALLOCATION OF COLLECTIONS; LIMITED SUBORDINATION OF CERTIFICATES
On each Deposit Date, the Servicer will allocate and distribute to the
Certificateholders an amount equal to (a) the Excess Certificateholder
Percentage of Series Allocable Principal Collections for such date; provided
that if the Pool Balance (determined after giving effect to any Principal
Receivables
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transferred to the Trust on such Deposit Date) is less than the Required Pool
Balance (after giving effect to the allocations, distributions, withdrawals and
deposits to be made on that Deposit Date), such funds shall be deposited into
the Excess Funding Account to the extent necessary so that the Pool Balance at
least equals the Required Pool Balance and (b) the Excess Certificateholder
Percentage of Series Allocable Non-Principal Collections for such date. In
addition, on each Deposit Date, an amount equal to the Additional Noteholder
Non-Principal Collections for such Deposit Date shall be retained in the
Collection Account to the extent that the Reserve Fund Required Amount exceeds
the amount in the Reserve Fund. During an Early Amortization Period, Additional
Noteholder Principal Collections shall be retained in the Collection Account and
treated as Noteholder Principal Collections.
Any remaining Additional Noteholder Collections for a Deposit Date not
required to be retained in the Collection Account pursuant to the preceding
paragraph or distributed in the amount of the Required Draw Amount will be
distributed to the Certificateholders if the Pool Balance (determined after
giving effect to the Principal Receivables transferred to the Trust on such
date) exceeds the Required Pool Balance (after giving effect to the allocations,
distributions, withdrawals and deposits to be made on the Deposit Date).
DISTRIBUTIONS FROM THE COLLECTION ACCOUNT; RESERVE FUND
Non-Principal Collections. On each Payment Date, commencing with the
initial Payment Date, the Servicer shall instruct the Indenture Trustee to apply
Noteholder Non-Principal Collections and Investment Proceeds, if any, in respect
of the related Collection Period to make the following distributions in the
following priority to the extent funds are available therefor:
(1) first, an amount equal to Class A Monthly Interest for such Payment
Date, plus the amount of any Class A Monthly Interest previously due
but not distributed on a prior Payment Date (plus, but only to the
extent permitted under applicable law, interest at the Class A Note
Rate on Class A Monthly Interest previously due but not distributed),
shall be distributed to the Class A Noteholders;
(2) second, an amount equal to Class B Monthly Interest for such Payment
Date, plus the amount of any Class B Monthly Interest previously due
but not distributed on a prior Payment Date (plus, but only to the
extent permitted under applicable law, interest at the Class B Note
Rate on Class B Monthly Interest previously due but not distributed),
shall be distributed to the Class B Noteholders;
(3) third, an amount equal to the Noteholder Monthly Servicing Fee for
such Payment Date shall be distributed to the Servicer (unless such
amount has been netted against deposits to the Collection Account as
described in the prospectus under 'The Notes--Allocation of
Collections; Deposits in Collection Account' or waived by the
Servicer);
(4) fourth, an amount equal to the Reserve Fund Deposit Amount, if any,
for such Payment Date shall be deposited in the Reserve Fund;
(5) fifth, an amount equal to the Noteholder Default Amount and the
Monthly Dilution Amount, if any, for such Payment Date shall be
treated as a portion of Noteholder Principal Collections for such day;
(6) sixth, an amount equal to the aggregate amount of Noteholder
Charge-Offs which have not been previously reversed shall be treated
as a portion of Noteholder Principal Collections for such day and
shall increase the Invested Amount (the 'NOTEHOLDER CHARGE-OFF
REVERSAL AMOUNT');
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(7) seventh, an amount equal to the amount of reductions of the Available
Subordinated Amount on account of Noteholder Default Amounts and
Monthly Dilution Amounts that have not previously been reinstated
shall be distributed to the Certificateholders and shall increase the
Available Subordinated Amount;
[(8) eighth, an amount equal to any outstanding Class A Carry-over Amount
shall be distributed to the Class A Noteholders;
(9) ninth, an amount equal to any outstanding Class B Carry-over Amount
shall be distributed to the Class B Noteholders;]
(10) tenth, an amount equal to the aggregate outstanding amounts of
Noteholder Monthly Servicing Fee which have been previously waived
shall be distributed to the Servicer; and
(11) eleventh, the balance shall be distributed to the Certificateholders.
If such Noteholder Non-Principal Collections and Investment Proceeds are
not sufficient to make the entire distributions required by clauses (1), (2),
(3) and (5) [and, in the case of the Class A Stated Maturity Date or the date on
which the principal amount of the Series 200 - Notes has been reduced to zero
only, clause (8) and, in the case of the Class B Stated Maturity Date or the
date on which the principal amount of the Series 200 - Notes has been reduced to
zero only, clause (9)], the Indenture Trustee shall withdraw funds from the
Reserve Fund [(in the case of clauses (8) and (9) only to the extent such
amounts would otherwise be distributed to the Certificateholders)] and apply
such funds to complete the distributions pursuant to such clauses; provided,
however, that during any Early Amortization Period funds shall not be withdrawn
from the Reserve Fund to make distributions required by clause (5) to the extent
that, after giving effect to such withdrawal, the amount on deposit in the
Reserve Fund shall be less than $ .
If such Noteholder Non-Principal Collections, Investment Proceeds and funds
withdrawn from the Reserve Fund are not sufficient to make the entire
distributions required by clauses (1), (2), (3) and (5) (such shortfall being
the 'DEFICIENCY AMOUNT'), the Indenture Trustee shall apply the amount of
Additional Noteholder Collections for the related Collection Period on deposit
in the Collection Account on such Payment Date, but only up to the Available
Subordinated Amount, to make the distributions required by clauses (1), (2), (3)
and (5) above that have not been made (the amount of Additional Noteholder
Collections so applied being referred to as the 'REQUIRED DRAW AMOUNT')[,and, if
such Payment Date is either the date on which the principal amount of the Series
200 - Notes has been reduced to zero or the Class A Stated Maturity Date or the
Class B Stated Maturity Date, the distributions required by clause (8) on the
Class A Notes or clause (9) on the Class B Notes, as applicable, that have not
been made.] The Available Subordinated Amount will be reduced by the amount of
Additional Noteholder Collections so applied. If the amount necessary to
complete the distributions referred to in this paragraph exceeds such Additional
Noteholder Collections, the Available Subordinated Amount will be reduced by the
amount of such excess, but not by more than the sum of the Noteholder Default
Amount and the portion of Adjustment Payments not paid by the Transferor, in
order to maintain the Invested Amount.
Reserve Fund. The 'RESERVE FUND' will be an Eligible Deposit Account
established and maintained in the name of the Indenture Trustee for the benefit
of the Series 200 - Noteholders. On the Series Issuance Date, the Trust will
deposit $ ( % of the principal balance of the Series 200 - Notes) into
the Reserve Fund. The 'RESERVE FUND REQUIRED AMOUNT' for any Payment Date with
respect to an Early Amortization Period is an amount equal to the Excess Reserve
Fund Required Amount, and for any other Payment Date is an amount equal to 0.50%
of the outstanding principal balance of the Series 200 - Notes for the next
following Payment Date (after giving effect to any change therein on such
Payment Date). The 'RESERVE FUND DEPOSIT AMOUNT' is the amount, if any,
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by which the Reserve Fund Required Amount exceeds the amount on deposit in the
Reserve Fund. Funds in the Reserve Fund will be invested in Eligible Investments
that will mature on or prior to the next Payment Date. On each Determination
Date, the Servicer will deposit any investment earnings (net of losses and
investment expenses) with respect to the Reserve Fund in the Collection Account
and treat such funds as Investment Proceeds and apply such amount as set forth
under '--Distributions from the Collection Account; Reserve Fund.' After the
earlier of the payment in full of the outstanding principal balance of the
Series 200 - Notes and the Class B Stated Maturity Date, any funds remaining on
deposit in the Reserve Fund will be paid to the Certificateholders.
If, after giving effect to the allocations, distributions and deposits in
the Reserve Fund described above under '--Non-Principal Collections,' the amount
in the Reserve Fund is less than the Reserve Fund Required Amount for such
Payment Date, the Indenture Trustee shall deposit any remaining Additional
Noteholder Non-Principal Collections for the related Collection Period into the
Reserve Fund until the amount in the Reserve Fund is equal to such Reserve Fund
Required Amount.
The 'EXCESS RESERVE FUND REQUIRED AMOUNT' for any such Payment Date means
an amount equal to the greater of
(a) % of the initial principal balance of the Series 200 - Notes at
the end of the Revolving Period
and
(b) the excess of
(1) the Available Subordinated Amount on the most recent Reset Date
(after giving effect to the allocations, distributions,
withdrawals and deposits to be made on such Payment Date)
over
(2) the excess of (x) the Series Allocation Percentage of the Pool
Balance on the most recent Reset Date over (y) the Invested
Amount on such Payment Date (after giving effect to changes
therein on such Payment Date);
provided that the Excess Reserve Fund Required Amount shall not exceed such
Available Subordinated Amount.
AVAILABLE SUBORDINATED AMOUNT
The 'AVAILABLE SUBORDINATED AMOUNT' means, on the Series Issuance Date, the
Required Subordinated Amount and, on any subsequent day of determination, an
amount equal to the lesser of (x) the Required Subordinated Amount for that day
and (y) the Available Subordinated Amount for the most recent Reset Date, minus
(A) the Required Draw Amount with respect to any Payment Date occurring after
that Reset Date, plus (B) the amount of Noteholder Non-Principal Collections and
Investment Proceeds distributed to the Certificateholders in respect of
Noteholder Default Amounts and Monthly Dilution Amounts that had previously
reduced the Available Subordinated Amount since the most recent Reset Date,
minus (C) the Incremental Subordinated Amount for the most recent Reset Date,
plus (D) the Incremental Subordinated Amount for such date of determination plus
(E) the Subordinated Percentage of the decrease in the Series Allocable Excess
Funding Amount since the most recent Reset Date, minus (F) the Subordinated
Percentage of the increase in the Series Allocable Excess Funding Amount since
the most recent Reset Date.
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<PAGE>
The Certificateholders may, in their sole discretion, at any time increase
the Available Subordinated Amount for so long as the cumulative amount of such
increases does not exceed the lesser of (1) $ or (2) % of the
Invested Amount. The Certificateholders are not under any obligation to increase
the Available Subordinated Amount at any time, except as described herein. If
the Available Subordinated Amount were reduced to less than the Required
Subordinated Amount, an Early Amortization Event would occur. The
Certificateholders could elect to increase the Available Subordinated Amount at
the time such Early Amortization Event would otherwise occur, thus preventing or
delaying the occurrence of the Early Amortization Event.
PRINCIPAL COLLECTIONS
On each Deposit Date with respect to a Revolving Period, all Series
Allocable Principal Collections allocated to the Series 200 - Noteholders shall
be treated as Excess Principal Collections and made available to other series,
deposited into the Excess Funding Account or paid to the Certificateholders.
On each Deposit Date, with respect to the Accumulation Period or any Early
Amortization Period, all Available Noteholder Principal Collections will be
allocated as follows:
(1) first, to the Principal Funding Account in an amount up to the Class A
Controlled Deposit Amount for such Deposit Date;
(2) second, to the Principal Funding Account in an amount up to the Class
B Controlled Deposit Amount for such Deposit Date; and
(3) third, the balance, if any, will be allocated to Excess Principal
Collections and made available to other series.
In the event that the Class B principal balance is greater than zero on the
Class B Stated Maturity Date, any funds remaining in the Reserve Fund (after the
application of funds in the Reserve Fund as described above under
'--Non-Principal Collections') will be treated as a portion of Available
Noteholder Principal Collections for the Payment Date occurring on the Class B
Stated Maturity Date.
EXCESS PRINCIPAL COLLECTIONS
The Servicer will allocate Excess Principal Collections to cover any
principal distributions to noteholders for any series entitled thereto which are
either scheduled or permitted and which have not been covered out of Principal
Collections and certain other amounts allocated to such series ('PRINCIPAL
SHORTFALLS'). See 'Maturity and Principal Payment Considerations.' Excess
Principal Collections will not be used to cover reductions in the invested
amount of any series. If Principal Shortfalls exceed Excess Principal
Collections for any Collection Period, Excess Principal Collections will be
allocated pro rata among the applicable series based on the relative amounts of
Principal Shortfalls.
DISTRIBUTIONS
Payments to Series 200 - Noteholders will be made from the Collection
Account, the Reserve Fund, and the Principal Funding Account.
(a) The Servicer shall instruct the Indenture Trustee to apply funds on
deposit in the Collection Account and the Reserve Fund and shall
instruct the Indenture Trustee to distribute on each Payment Date the
amounts on deposit in the Collection Account and the Reserve Fund as
are payable to the Series 200 - Noteholders with respect to accrued
interest to the Series 200 - Noteholders; provided, however, that no
Class B Monthly Interest shall be paid to the Class B Noteholders
until all Class A Monthly Interest has been paid the Class A
Noteholders [and no
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Class B Carry-over Amount shall be paid to the Class B Noteholders
until all Class A Carry-over Amounts have been paid to the Class A
Noteholders].
(b) The Servicer shall instruct the Indenture Trustee to apply the funds
on deposit in the Principal Funding Account and the Collection Account
and shall instruct the Indenture Trustee to make, without duplication,
the following distributions at the following times:
(1) on the Expected Principal Payment Date and each Special Payment
Date, the amounts on deposit in the Principal Funding Account and
the Collection Account as are payable to Class A Noteholders with
respect to principal shall be distributed to the Class A
Noteholders up to a maximum amount on any such date equal to the
outstanding principal amount of the Class A Notes; and
(2) if all of the amounts due and owing to the Class A Noteholders
pursuant to clause (1) above have been paid in full, on the
Expected Principal Payment Date and each Special Payment Date,
the amounts on deposit in the Principal Funding Account and the
Collection Account as are payable to Class B Noteholders with
respect to principal shall be distributed to the Class B
Noteholders up to a maximum amount on any such date equal to the
outstanding principal amount of the Class B Notes.
[(c) On each Payment Date on which there is an unpaid Class A Carry-over
Amount, the Servicer shall instruct the Indenture Trustee to
distribute to the Class A Noteholders such Class A Carry-over Amount
to the extent funds are available therefor after making all required
distributions and deposits with respect to the Series 200 - Notes as
provided above under '--Distributions from the Collection Account;
Reserve Fund--Non-Principal Collections.']
[(d) On each Payment Date on which there is an unpaid Class B Carry-over
Amount, the Servicer shall instruct the Indenture Trustee to
distribute to the Class B Noteholders such Class B Carry-over Amount
to the extent funds are available therefor after making all required
distributions and deposits with respect to the Series 200 - Notes as
provided above under '--Distributions from the Collection Account;
Reserve Fund--Non-Principal Collections.']
[(e) If on the Class A Stated Maturity Date there is any Class A
Carry-over Amount or on the Class B Stated Maturity Date there is any
Class B Carry-over Amount (in each case after giving effect to any
distributions on such date pursuant to (a) through (d) above), the
Indenture Trustee shall distribute to the Class A Noteholders or the
Class B Noteholders, as applicable, (1) certain amounts on deposit in
the Reserve Fund (to the extent such amounts would otherwise be
distributed to the Certificateholders) and (2) Additional Noteholder
Collections on deposit in the Collection Account (to the extent such
amounts would otherwise be distributed to the Certificateholders)
which are available to satisfy such Class A Carry-over Amount or
Class B Carry-over Amount on the Class A Stated Maturity Date or
Class B Stated Maturity Date, as applicable, as described above under
'--Distributions from the Collection Account; Reserve
Fund--Non-Principal Collections'; provided, however, that if there is
any Carry-over Amount, such funds will also be available on the date
on which the principal balance of the Series 200 - Notes has been
reduced to zero.]
All distributions shall be made to the Series 200 - Noteholders of record
at the close of business on the day immediately preceding the related Payment
Date (each such day a 'RECORD DATE'), except that the final distribution with
respect to any Series 200 - Note will be made only upon surrender of such Series
200 - Note.
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NOTEHOLDER CHARGE-OFFS
If the Available Subordinated Amount is reduced to zero and on any Payment
Date the Deficiency Amount is greater than zero, the Invested Amount of the
Series 200 - Notes will be reduced by the Deficiency Amount, but not by more
than the sum of the Noteholder Default Amount and the Monthly Dilution Amount
for such Payment Date (a 'NOTEHOLDER CHARGE-OFF'). Any such reduction shall be
applied first to reduce the Class B Invested Amount (a 'CLASS B NOTEHOLDER
CHARGE-OFF') but not below zero, and then to reduce the Class A Invested Amount
(a 'CLASS A NOTEHOLDER CHARGE-OFF') but not below zero. Any reduction in the
Invested Amount of the Series 200 - Notes of either class will have the effect
of slowing or reducing the return of principal to the holders of Series 200 -
Notes of that class. If the Invested Amount of either class of the Series 200 -
Notes has been reduced by any Noteholder Charge-Offs, it will thereafter be
increased on any Payment Date (but not by an amount in excess of the aggregate
unreversed Noteholder Charge-Offs) by the Noteholder Charge-Off Reversal Amount
as described above under'--Distributions from the Collection Account; Reserve
Fund--Non-Principal Collections.' Any such increase shall be applied first to
the Class A Invested Amount until all previously unreversed Class A Noteholder
Charge-Offs have been reversed and then to the Class B Invested Amount until all
previously unreversed Class B Noteholder Charge-Offs have been reversed.
EARLY AMORTIZATION EVENTS
The Early Amortization Events with respect to the Series 200 - Notes will
include each of the events so defined in the prospectus, plus the following:
(1) failure on the part of the Transferor, the Servicer or World Omni, as
applicable, (a) to make any payment or deposit required by the Trust
Sale and Servicing Agreement or the Receivables Purchase Agreement,
including but not limited to any Transfer Deposit Amount or Adjustment
Payment, on or before the date occurring ten business days after the
date such payment or deposit is required to be made therein; or (b) to
deliver a Payment Date Statement on the date required under the Trust
Sale and Servicing Agreement (or within the applicable grace period
which will not exceed five business days); (c) to comply with its
covenant not to create any lien on a Receivable; or (d) to observe or
perform in any material respect any other covenants or agreements set
forth in the Trust Sale and Servicing Agreement or the Receivables
Purchase Agreement, which failure continues unremedied for a period of
45 days after written notice of such failure;
(2) any representation or warranty made by World Omni in the Receivables
Purchase Agreement or by the Transferor in the Trust Sale and
Servicing Agreement or any information required to be given by the
Transferor to the Indenture Trustee to identify the Accounts proves to
have been incorrect in any material respect when made and continues to
be incorrect in any material respect for a period of 60 days after
written notice and as a result the interests of the Noteholders are
materially and adversely affected; provided, however, that an Early
Amortization Event shall not be deemed to occur thereunder if the
Transferor has repurchased the related Receivables or all such
Receivables, if applicable, during such period in accordance with the
provisions of the Trust Sale and Servicing Agreement;
(3) on any Determination Date, the Available Subordinated Amount for the
next Payment Date will be reduced to an amount less than the Required
Subordinated Amount on such Determination Date after giving effect to
the distributions to be made on the next Payment Date;
(4) any Servicing Default with respect to the Series 200 - Notes occurs;
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(5) on any Determination Date, the average of the Monthly Payment Rates
for the three preceding Collection Periods, is less than %; and
(6) the occurrence of an Event of Default with respect to the Series
200 - Notes and the declaration that the Series 200 - Notes are due
and payable; and
[(7) any Carry-over Amount is outstanding on consecutive Payment
Dates].
In the case of any event described in clause 1, 2, 4 or 6 above, an Early
Amortization Event with respect to Series 200 - will be deemed to have occurred
only if, after the applicable grace period described in such clauses, if any,
either the Indenture Trustee or Series 200 - Noteholders holding Series 200 -
Notes evidencing more than 50% of the aggregate unpaid principal amount of the
Class A Notes by written notice to the Trust, the Transferor and the Servicer
(and the Indenture Trustee, if given by Noteholders) declare that an Early
Amortization Event has occurred as of the date of such notice. In the case of
any Early Amortization Event described in the prospectus or any event described
in clause 3, 5, and 7 above, an Early Amortization Event with respect to Series
200 - will be deemed to have occurred without any notice or other action on the
part of the Indenture Trustee or the Series 200 - Noteholders immediately upon
the occurrence of such event.
Under certain limited circumstances, an Early Amortization Period which
commences prior to the scheduled end of the Revolving Period may terminate and
the Revolving Period recommence. If an Early Amortization Event (other than an
Early Amortization Event described in the prospectus) occurs, the Revolving
Period will recommence following receipt of (1) written confirmation by each
Rating Agency that its rating of the Series 200 - Notes will not be withdrawn or
lowered as a result of such recommencement and (2) the consent of Series 200 -
Noteholders evidencing more than 50% of the aggregate unpaid principal amount of
the Controlling Class of the Series 200 - Notes to such recommencement, provided
that no other Early Amortization Event that has not been cured or waived as
described herein has occurred and the scheduled termination of the Revolving
Period has not occurred.
STATED MATURITY DATE
The last payment of principal and interest on the Class A Notes will be due
and payable no later than the Payment Date (the 'CLASS A STATED
MATURITY DATE'). In the event that the aggregate outstanding principal amount of
the Class A Notes is greater than zero on the Class A Stated Maturity Date
(after giving effect to deposits and distributions otherwise to be made on such
Class A Stated Maturity Date), upon receipt of an opinion of counsel to the
effect that its action will not result in the trust being characterized as an
association (or a publicly traded partnership) taxable as a corporation, the
Indenture Trustee will sell or cause to be sold an interest in the Receivables
or certain Receivables, as specified in the Indenture, in an amount such that
the proceeds of such sale equal the aggregate outstanding principal balance of
and accrued and unpaid interest on the Class A Notes on such Class A Stated
Maturity Date (after giving effect to such deposits and distributions);
provided, however, in no event shall such amount of Receivables to be sold
exceed the lesser of (a) the sum of the Invested Amount and the Available
Subordinated Amount on the preceding Determination Date (after giving effect to
the allocations, distributions, withdrawals and deposits to be made on the
Payment Date following such Determination Date) and (b) the Series Allocation
Percentage of Receivables on such Class A Stated Maturity Date. The amount of
Receivables sold shall first reduce the Class A Invested Amount, but not to
below zero, then any remaining amounts shall reduce the Available Subordinated
Amount, but not to below zero, and then any amounts still remaining shall reduce
the Class B Invested Amount. The net proceeds of such sale and any collections
on the Receivables will be paid pro rata to Class A Noteholders on the Class A
Stated Maturity Date as the final payment of the Class A Notes, and the Class A
Noteholders shall not receive any additional payments with respect to the Class
A Notes.
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<PAGE>
The last payment of principal and interest on the Class B Notes will be due
and payable no later than the Payment Date (the 'CLASS B STATED
MATURITY DATE'). In the event that the aggregate outstanding principal balance
of the Class B Notes is greater than zero on the Class B Stated Maturity Date
(after giving effect to deposits and distributions otherwise to be made on such
Class B Stated Maturity Date), upon receipt of an opinion of counsel to the
effect that its action will not result in the trust being characterized as an
association (or a publicly traded partnership) taxable as a corporation, the
Indenture Trustee will sell or cause to be sold an interest in the Receivables
or certain Receivables in an amount such that the net proceeds of such sale
equal the aggregate outstanding principal balance of and accrued and unpaid
interest on the Class B Notes on such Class B Stated Maturity Date (after giving
effect to such deposits and distributions); provided, however, in no event shall
such amount of Receivables to be sold exceed the lesser of (a) the sum of the
Invested Amount and the Available Subordinated Amount on the preceding
Determination Date (after giving effect to the allocations, distributions,
withdrawals and deposits to be made on the Payment Date following such
Determination Date, including any adjustment as a result of the preceding
paragraph) and (b) the Series Allocation Percentage of Receivables on such Class
B Stated Maturity Date. The amount of Receivables sold shall first reduce the
Class B Invested Amount, but not to below zero, then any remaining amounts shall
reduce the Available Subordinated Amount. The net proceeds of such sale and any
collections on the Receivables will be paid pro rata to Class B Noteholders on
the Class B Stated Maturity Date as the final payment of the Class B Notes, and
the Class B Noteholders shall not receive any additional payments with respect
to the Class B Notes.
PAYMENT EVENT OF DEFAULT
In the event that an Event of Default relating to the failure to make any
required payment of interest or principal on the Series 200 - Notes has occurred
and the Series 200 - Notes have been declared due and payable, on the direction
of the holders of a majority of the aggregate outstanding principal amount of
the Controlling Class of the Series 200 - Notes, upon receipt of an opinion of
counsel to the effect that its action will not result in the trust being
characterized as an association (or a publicly traded partnership) taxable as a
corporation, the Indenture Trustee will sell or cause to be sold an interest in
the Receivable or certain Receivables in an amount such that the net proceeds of
such sale equal the aggregate outstanding principal balance of and accrued and
unpaid interest on the Series 200 - Notes then outstanding on such date;
provided, however, in no event shall such amount exceed the lesser of (a) the
sum of the Invested Amount and the Available Subordinated Amount on the
preceding Determination Date (after giving effect to the allocations,
distributions, withdrawals and deposits to be made prior to such date); and (b)
the Series Allocation Percentage of Receivables on such date. The net proceeds
of such sale will be paid pro rata to the Class A Noteholders in an amount up to
the aggregate outstanding principal balance of and accrued and unpaid interest
on the Class A Notes, and then, to the extent of funds remaining, to the Class B
Noteholders, and the Series 200 - Noteholders shall not receive any additional
payments with respect to the Series 200 - Notes.
OPTIONAL REPURCHASE
The Series 200 - Notes will be subject to optional repurchase by World Omni
on any Payment Date after the aggregate outstanding principal balance of the
Series 200 - Notes is reduced to an amount less than or equal to $ (10% of
the initial outstanding principal amount of the Series 200 - Notes). The
purchase price will equal the sum of (1) the aggregate outstanding principal
balance of the Series 200 - Notes to be repurchased on the Determination Date
preceding the Payment Date on which the purchase is scheduled to be made, (2)
accrued and unpaid interest on the Series 200 - Notes to be repurchased at the
applicable Note Rate (together with interest on overdue interest) [and (3) any
outstanding Carry-Over Amount with respect to the Series 200 - Notes to be
repurchased.]
S-25
<PAGE>
PRINCIPAL FUNDING ACCOUNT
The Servicer will establish and maintain in the name of the Indenture
Trustee, on behalf of the Trust, an Eligible Deposit Account for the benefit of
the Series 200 - Noteholders (the 'PRINCIPAL FUNDING ACCOUNT'). On each Deposit
Date with respect to the Accumulation Period or an Early Amortization Period,
the Class A Controlled Deposit Amount and the Class B Controlled Deposit Amount
will be deposited in the Principal Funding Account, in each case as provided
above under '--Distributions from the Collection Account; Reserve
Fund--Principal Collections'; provided, that, if an Early Amortization Period
that is not terminated as described herein commences during the Accumulation
Period, the Principal Funding Account Balance shall be paid to the Series 200 -
Noteholders on the first Special Payment Date.
All amounts on deposit in the Principal Funding Account on any Payment Date
prior to the Expected Principal Payment Date (after giving effect to
distributions to be made on such Payment Date) (the 'PRINCIPAL FUNDING ACCOUNT
BALANCE') will be invested from the date of their deposit by the Indenture
Trustee at the direction of the Servicer in Eligible Investments that will
mature on or prior to the Expected Principal Payment Date. On and after the
Expected Principal Payment Date, amounts on deposit in the Principal Funding
Account will be invested in Eligible Investments that will mature on or prior to
the following Payment Date. The Servicer may select an appropriate agent as
representative of the Servicer for the purpose of designating such investments.
On each Payment Date, the interest and other investment income on the Principal
Funding Account Balance will be deposited in the Collection Account, treated as
Investment Proceeds and applied as provided above under '--Distributions from
the Collection Account; Reserve Fund.'
EXCESS FUNDING ACCOUNT
The Series 200 - share of funds on deposit in the Excess Funding Account on
the last day of the Revolving Period will be deposited in the Principal Funding
Account on such date. Funds in the Excess Funding Account are to be allocated
and distributed in the manner described in the prospectus. The Series 200 -
Noteholders will not be entitled to any funds in the Excess Funding Account
after such deposit has been made.
REPORTS
On each Payment Date (including each Payment Date that corresponds to the
Expected Principal Payment Date or any Special Payment Date), commencing with
the initial Payment Date, the Indenture Trustee will forward to each Series
200 - Noteholder of record a statement (the 'PAYMENT DATE STATEMENT') prepared
by the Servicer setting forth the following information (which, in the case of
(c), (d) and (e) below, will be stated on the basis of an original principal
amount of $1,000 per Series 200 - Note if the Accumulation Period or an Early
Amortization Period has commenced):
(a) the aggregate amount of Collections, the aggregate amount of
Non-Principal Collections and the aggregate amount of Principal
Collections processed during the immediately preceding Collection
Period and the Pool Balance, the Required Pool Balance and the Excess
Funding Account Balance as of the close of business on the last day of
the preceding Collection Period;
(b) the Series Allocation Percentage, the Floating Allocation Percentage
and the Principal Allocation Percentage for the preceding Collection
Period;
(c) the total amount, if any, distributed on the Class A Notes and the
Class B Notes;
(d) the amount of such distribution allocable to principal on each class
of Series 200 - Notes;
(e) the amount of such distribution allocable to interest on each class of
Series 200 - Notes;
S-26
<PAGE>
(f) the Noteholder Default Amount for such Payment Date;
(g) the Required Draw Amount, if any, for such Collection Period;
(h) the amount of the Class A Noteholder Charge-Offs and Class B
Noteholder Charge-Offs and the amounts of the reversals thereof for
such Collection Period;
(i) the amount of the Monthly Servicing Fee and the Noteholder Monthly
Servicing Fee for such Collection Period;
(j) the Class A Controlled Deposit Amount and Class B Controlled Deposit
Amount for the following Payment Date, if any;
(k) the Invested Amount and the outstanding principal balance of each
Class of Series 200 - Notes for such Payment Date (after giving effect
to all distributions which will occur on such Payment Date);
(l) the Available Subordinated Amount as of the last day of the preceding
Collection Period
(m) the Reserve Fund balance for such date; and
(n) the Principal Funding Account Balance with respect to such date.
DEFINITIONS
'ADDITIONAL NOTEHOLDER COLLECTIONS' for any date means the sum of (a) the
Additional Noteholder Non-Principal Collections for such date and (b) the
Additional Noteholder Principal Collections for such date.
'ADDITIONAL NOTEHOLDER NON-PRINCIPAL COLLECTIONS' for any date means an
amount equal to the product of (a) the excess of (1) the Certificateholder
Percentage for such date over (2) the Excess Certificateholder Percentage for
such date by (b) Series Allocable Non-Principal Collections for such date;
provided, however, that the Additional Noteholder Non-Principal Collections will
be zero for any date on which the Available Subordinated Amount is zero.
'ADDITIONAL NOTEHOLDER PRINCIPAL COLLECTIONS' for any date means an amount
equal to the product of (a) the excess of (1) the Certificateholder Percentage
for such date over (2) the Excess Certificateholder Percentage for such date and
(b) Series Allocable Principal Collections for such date; provided, however,
that the Additional Noteholder Principal Collections will be zero for any date
on which the Available Subordinated Amount is zero.
['ASSETS RECEIVABLES RATE' means for any Interest Period an amount equal to
the product of:
(a) the quotient obtained by dividing (1) 360 by (2) the actual number of
days elapsed in such period
and
(b) a fraction,
(1) the numerator of which is the sum of (A) Noteholder Non-Principal
Collections for the Collection Period immediately preceding the
last day of such period (which for this purpose only is based on
interest amounts billed to the Dealers which are due during such
Collection Period) less the Monthly Servicing Fee with respect to
such immediately preceding Collection Period, to the extent not
waived by the Servicer and (B) the Investment Proceeds to be
applied on the Payment Date related to such period
S-27
<PAGE>
and
(2) the denominator of which is the sum of (A) the product of the
Floating Allocation Percentage, the Series Allocation Percentage
and the average Pool Balance (after giving effect to any
charge-offs) for such immediately preceding Collection Period,
(B) the principal balance on deposit in the Excess Funding
Account on the first day of such period (after giving effect to
all deposits to and withdrawals therefrom on such first day), and
(C) the principal balance on deposit in the Principal Funding
Account on the first day of such period (after giving effect to
all deposits to and withdrawals therefrom on such first day).]
'AVAILABLE NOTEHOLDER PRINCIPAL COLLECTIONS' for any Deposit Date falling
in the Accumulation Period or an Early Amortization Period means the sum of (a)
Noteholder Principal Collections for such Deposit Date, (b) Excess Principal
Collections allocated to the Series 200 - Notes to cover any Principal Shortfall
for such Deposit Date, (c) any funds transferred from the Excess Funding Account
to the Principal Funding Account on such Deposit Date and (d) on the Class A
Stated Maturity Date or the Class B Stated Maturity Date, funds in the Reserve
Fund to the extent of any outstanding Class A Carry-over Amount, in the case of
the Class A Stated Maturity Date, or Class B Carry-over Amount, in the case of
the Class B Stated Maturity Date.
['CALCULATION AGENT' means the Indenture Trustee.]
'CERTIFICATEHOLDER PERCENTAGE' means 100% minus (a) the Floating Allocation
Percentage, when used with respect to Non-Principal Collections and Defaulted
Receivables at all times and Principal Collections during any Revolving Period,
and (b) the Principal Allocation Percentage, when used with respect to Principal
Collections during the Accumulation Period and any Early Amortization Period.
'CLASS A CONTROLLED ACCUMULATION AMOUNT' means an amount equal to the
aggregate outstanding principal balance of the Class A Notes as of the Payment
Date immediately preceding the first day of the Accumulation Period (after
giving effect to any changes therein on such date) divided by the Accumulation
Period Length.
'CLASS A CONTROLLED DEPOSIT AMOUNT' for a Deposit Date means (i) during the
Accumulation Period, the excess, if any, of (a) the product of the Class A
Controlled Accumulation Amount and the number of Payment Dates from and
including the first Payment Date with respect to the Accumulation Period through
and including the Payment Date related to the Collection Period during which the
Deposit Date occurs (but not in excess of the Accumulation Period Length) over
(b) the amount on deposit in the Principal Funding Account before giving effect
to any withdrawals from or deposits to such account on such Deposit Date and
(ii) during an Early Amortization Period, the Class A Invested Amount.
'CLASS A INITIAL INVESTED AMOUNT' means $ .
'CLASS A INVESTED AMOUNT' means for any date an amount equal to the Class A
Initial Invested Amount minus the amount, without duplication, of principal
payments made to Class A Noteholders or deposited to the Principal Funding
Account in respect of the Class A Notes prior to such date since the Series
Issuance Date, minus the excess, if any, of the aggregate amount of Class A
Noteholder Charge-Offs for all Payment Dates preceding such date, over the
aggregate amount of any reversals of Class A Noteholder Charge-Offs for all
Payment Dates preceding such date, minus the Series 200 - Excess Funding Amount
for such day but limited to an amount that would reduce the Class A Invested
Amount to zero.
'CLASS A MONTHLY INTEREST' for any Payment Date means the amount of
interest accrued in respect of the Class A Notes as described above for such
Payment Date.
S-28
<PAGE>
'CLASS B CONTROLLED ACCUMULATION AMOUNT' means an amount equal to the
aggregate outstanding principal balance of the Class B Notes as of the Payment
Date immediately preceding the first day of the Accumulation Period (after
giving effect to any changes therein on such date) divided by the Accumulation
Period Length.
'CLASS B CONTROLLED DEPOSIT AMOUNT' for a Deposit Date means (i) during the
Accumulation Period, the excess, if any, of (a) the product of the Class B
Controlled Accumulation Amount and the number of Payment Dates from and
including the first Payment Date with respect to the Accumulation Period through
and including the Payment Date related to the Collection Period during which the
Deposit Date occurs (but not in excess of the Accumulation Period Length) over
(b) the amount on deposit in the Principal Funding Account before giving effect
to any withdrawals from or deposits to such account on such Deposit Date and
(ii) during an Early Amortization Period, the Class B Invested Amount.
'CLASS B INITIAL INVESTED AMOUNT' means $ .
'CLASS B INVESTED AMOUNT' means for any date an amount equal to the Class B
Initial Invested Amount, minus the amount, without duplication, of principal
payments made to Class B Noteholders or deposited to the Principal Funding
Account in respect of the Class B Notes prior to such date since the Series
Issuance Date minus the excess, if any, of aggregate amount of Class B
Noteholder Charge-Offs for all Payment Dates preceding such date, over the
aggregate amount of any reversals of Class B Noteholder Charge-Offs for all
Payment Dates preceding such date minus the amount, if any, of the Series 2000-1
Excess Funding Amount remaining after allocation to the Class A Invested Amount
but limited to an amount that would reduce the Class B Invested Amount to zero.
'CLASS B MONTHLY INTEREST' for any Payment Date means the amount of
interest accrued in respect of the Class B Notes as described above for such
Payment Date.
'EXCESS CERTIFICATEHOLDER PERCENTAGE' for any day means a percentage (which
percentage shall never be less than 0% nor more than 100%) equal to (a) 100%
minus, when used with respect to Non-Principal Collections and Defaulted
Receivables at all times and Principal Collections during any Revolving Period,
the sum of (1) the Floating Allocation Percentage with respect to such day and
(2) the percentage equivalent of a fraction, the numerator of which is the
Available Subordinated Amount as of the most recent Reset Date and the
denominator of which is the product of (A) the Pool Balance as of the most
recent Reset Date and (B) the Series Allocation Percentage for such day in
respect of which the Excess Certificateholder Percentage is being calculated or
(b) 100% minus, when used with respect to Principal Collections during the
Accumulation Period and any Early Amortization Period, the sum of (1) the
Principal Allocation Percentage with respect to such day and (2) the percentage
equivalent of a fraction, the numerator of which is the Available Subordinated
Amount as of the most recent Reset Date and the denominator of which is the
product of (A) the Pool Balance as of the most recent Reset Date and (B) the
Series Allocation Percentage for the day in respect of which the Excess
Certificateholder Percentage is being calculated.
'FLOATING ALLOCATION PERCENTAGE' means, with respect to any day, the
percentage equivalent (which shall never exceed 100%) of a fraction, the
numerator of which is the Invested Amount as of the most recent Reset Date and
the denominator of which is the product of (x) the Pool Balance as of such Reset
Date and (y) the Series Allocation Percentage for the day in respect of which
the Floating Allocation Percentage is being calculated; provided, however, that,
prior to the first Reset Date, the Floating Allocation Percentage means the
percentage equivalent of a fraction, the numerator of which is the Initial
Invested Amount and the denominator of which is the product of the Pool Balance
on the Series Cut-Off Date and the Series Allocation Percentage with respect to
the Series Cut-Off Date.
S-29
<PAGE>
'INCREMENTAL SUBORDINATED AMOUNT' means, for the period beginning on a
Determination Date and ending on the next Determination Date, the product of (a)
a fraction, the numerator of which is the sum of the Target Invested Amount and
the Target Available Subordinated Amount and the denominator of which is the
greater of (i) the Pool Balance and (ii) the sum of the amounts calculated as
the numerator above and (b) the Trust Incremental Subordinated Amount, in each
case, on the most recent Reset Date.
'INITIAL INVESTED AMOUNT' means the sum of the Class A Initial Invested
Amount and the Class B Initial Invested Amount.
'INVESTED AMOUNT' means for any date an amount equal to the sum of the
Class A Invested Amount and the Class B Invested Amount.
'INVESTMENT PROCEEDS' for any Payment Date means an amount equal to the sum
of investment earnings deposited into the Collection Account on the related
Determination Date with respect to:
(a) funds held in the Reserve Fund;
(b) the Series Allocation Percentage of funds held in the Collection
Account;
(c) funds held in the Principal Funding Account; and
(d) the Series Allocation Percentage of funds held in the Excess Funding
Account.
['LIBOR' with respect to any Interest Period will be established by the
Calculation Agent and will equal the offered rate for United States dollar
deposits for one month that appears on Telerate Page 3750 as of 11:00 A.M.,
London time, on the second LIBOR Business Day prior to such Interest Period (a
'LIBOR DETERMINATION DATE'). 'TELERATE PAGE 3750' means the display page so
designated on the Dow Jones Telerate Service (or such other page as may replace
that page on that service, or such other service as may be nominated as the
information vendor, for the purpose of displaying London interbank offered rates
of major banks). If such rate appears on Telerate Page 3750, LIBOR will be such
rate. 'LIBOR BUSINESS DAY' means a day on which banking institutions in New
York, New York and London, England are not required or authorized by law to be
closed. If on any LIBOR Determination Date the offered rate does not appear on
Telerate Page 3750, the Calculation Agent will request each of the reference
banks (which shall be major banks that are engaged in transactions in the London
interbank market selected by the Calculation Agent) to provide the Calculation
Agent with its offered quotation for United States dollar deposits for one month
to prime banks in the London interbank market as of 11:00 A.M., London time, on
such date. If at least two reference banks provide the Calculation Agent with
such offered quotations, LIBOR on such date will be the arithmetic mean, rounded
upwards, if necessary, to the nearest 1/100,000 of 1% (.0000001), with five
one-millionths of a percentage point rounded upward, of all such quotations. If
on such date fewer than two of the reference banks provide the Calculation Agent
with such offered quotations, LIBOR on such date will be the arithmetic mean,
rounded upwards, if necessary, to the nearest 1/100,000 of 1% (.0000001), with
five one-millionths of a percentage point rounded upward, of the offered per
annum rates that one or more leading banks in New York City selected by the
Calculation Agent are quoting as of 11:00 A.M., New York City time, on such date
to leading European banks for United States dollar deposits for one month;
provided, however, that if such banks are not quoting as described above, LIBOR
for such date will be LIBOR applicable to the Interest Period immediately
preceding such Interest Period.
'MONTHLY DILUTION AMOUNT' means an amount equal to the Weighted Average
Series Allocation Percentage of any Adjustment Payment required to be deposited
into the Collection Account pursuant to
S-30
<PAGE>
the Trust Sale and Servicing Agreement with respect to the related Collection
Period that has not been so deposited as of the related Determination Date.
'MONTHLY INTEREST' means Class A Monthly Interest plus Class B Monthly
Interest.
'NOTEHOLDER DEFAULT AMOUNT' means, with respect to any Payment Date, an
amount equal to the excess, if any, of (a) the product of the Series Allocable
Defaulted Amount for the related Collection Period and the Weighted Average
Floating Allocation Percentage for the related Collection Period over (b) the
Incremental Subordinated Amount for that Payment Date.
'NOTEHOLDER MONTHLY SERVICING FEE' means an amount equal to one-twelfth of
the product of (a) the Servicing Fee Rate and (b) the Invested Amount as of the
last day of the Collection Period second preceding such Payment Date.
'NOTEHOLDER NON-PRINCIPAL COLLECTIONS' for any Deposit Date means the
portion of Series Allocable Non-Principal Collections for such Deposit Date
allocated to the Series 200 - Noteholders' Interest as described under
'--Allocation Percentages.'
'NOTEHOLDER PRINCIPAL COLLECTIONS' means, with respect to any Deposit Date
falling in the Accumulation Period or an Early Amortization Period, the sum of
(a) the Principal Allocation Percentage then in effect of Series Allocable
Principal Collections (including any Series Allocable Miscellaneous Payments
that are treated as Series Allocable Principal Collections) and (b) for any
Deposit Date that is also a Payment Date, the amounts, if any, of Noteholder
Non-Principal Collections, Investment Proceeds, funds in the Reserve Fund and
Additional Noteholder Collections allocated to cover the Noteholder Default
Amount or to reverse Noteholder Charge-offs.
'PRINCIPAL ALLOCATION PERCENTAGE' means, with respect to any day, the
percentage equivalent (which shall never exceed 100%) of a fraction, the
numerator of which is the Invested Amount as of the last day of the Revolving
Period and the denominator of which is the product of (x) the Pool Balance as of
such last day and (y) the Series Allocation Percentage for the day in respect of
which the Principal Allocation Percentage is being calculated; provided however,
that, with respect to that portion of any Collection Period that falls after the
date on which any Early Amortization Event occurs, the Principal Allocation
Percentage shall be reset using the Pool Balance as of the close of business on
the date on which such Early Amortization Event shall have occurred and
Principal Collections shall be allocated for such portion of such Collection
Period using such reset Principal Allocation Percentage.
'REQUIRED PARTICIPATION PERCENTAGE' shall mean, with respect to Series
200 - , %.
'REQUIRED SUBORDINATED AMOUNT' means, as of any date of determination, the
sum of (1)the product of the Subordinated Percentage and the Invested Amount as
of the opening of business on such date and (2) the Incremental Subordinated
Amount. The Required Subordinated Amount will initially be $ .
'SUBORDINATION FACTOR' shall mean %.
'SUBORDINATED PERCENTAGE' means the percentage equivalent of a fraction,
the numerator of which is the Subordination Factor and the denominator of which
will be the excess of 100% over the Subordination Factor.
'TARGET INVESTED AMOUNT' shall mean, with respect to any series of notes
and for any day, the Invested Amount that would result if the Invested Amount
for that series was calculated as if the amount on deposit in the Excess Funding
Account was zero.
S-31
<PAGE>
'WEIGHTED AVERAGE FLOATING ALLOCATION PERCENTAGE' means, for any Collection
Period, a percentage equal to the result of (a) the sum of the Floating
Allocation Percentages for each day during that Collection Period, divided by
(b) the number of days in that Collection Period.
S-32
<PAGE>
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
In the opinion of Kirkland & Ellis, special tax counsel to the Transferor,
for U.S. federal income tax purposes, the Series 200 - Notes will constitute
indebtedness. Each Noteholder, by the acceptance of a Series 200 - Note, will
agree to treat the Series 200 - Notes as indebtedness for federal, state and
local income and franchise tax purposes.
All the certificates issued as of the Series Issuance Date shall have been
issued to the Transferor. Accordingly, the Trust will be characterized as a
division of the Transferor for U.S. federal income tax purposes. See 'Certain
Federal Income Tax Consequences--Tax Characterization of the Trust' in the
prospectus. If the Transferor sells any of the certificates or if the Trust
issues additional certificates, this characterization may change. See 'Certain
Federal Income Tax Consequences--Tax Characterization of the Trust' in the
prospectus.
As discussed in the Prospectus, a series of Notes will be treated as having
been issued with original issue discount ('OID') if the interest payable with
respect to such series of Notes is not treated as qualified stated interest
('QSI'). If a series of Notes does not pay QSI, all of the taxable income
thereon would be includible in income as OID, as described in the Prospectus.
The Transferor believes that all of the interest with respect to each
series of Notes will be treated as QSI. However, there is a minimal risk that
the interest would not be treated as QSI because the interest rate on a series
of Notes is capped at the Asset Receivables Rate, and thus to the extent that
the interest rate on a series of Notes rose to or above the Asset Receivables
Rate, some of the interest with respect to such series of Notes would
effectively be deferred. The Transferor believes that the likelihood that this
could occur is extremely remote, and thus it does not believe that any of the
interest with respect to a series of Notes would be treated as not being QSI.
For a discussion of the consequences to a Noteholder if interest on a
series of Notes was not QSI, please see the prospectus.
See 'Certain Federal Income Tax Consequences' and 'State and Local Tax
Consequences' in the prospectus.
FLORIDA INCOME TAXATION
A rule under the Florida Income Tax Code (the 'LOAN RULE') 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 regardless of where the interest was received. A financial
organization is defined to include any bank, trust company, savings bank,
industrial bank, land bank, safe deposit company, private banker, 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 the
Series 200 - Notes, then a financial organization investing in the Series 200 -
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. The Transferor
believes the Loan Rule does not apply to an investment in the Series 200 - Notes
or the receipt of interest on the Series 200 - Notes by a financial organization
with no other Florida contacts. We urge you to consult your own tax advisor as
to the applicability of the Loan Rule to an investment in the Series 200 - Notes
and your ability to offset any such Florida tax against any other state tax
liabilities.
S-33
<PAGE>
ERISA CONSIDERATION
Although there is little guidance on the subject, the Transferor believes that,
at the time of their issuance, the Series 200 - Notes would be treated a
indebtedness without substantial equity features for purposes of the Plan Asset
Regulation. The debt treatment of the Series 200 - Notes could change,
subsequent to their issuance, if the Trust incurred losses. However, without
regard to whether Series 200 - Notes are treated as an equity interest for such
purposes, the acquisition or holding of Series 200 - Notes by or on behalf of a
Benefit Plan could be considered to give rise to a prohibited transaction if the
Transferor, the Trust or any of their respective affiliates is or becomes a
party in interest or a disqualified person with respect to such Benefit Plan.
Certain exemptions from the prohibited transaction rules could be applicable to
the purchase and holding of Series 200 - Notes by a Benefit Plan depending on
the type and circumstances of the plan fiduciary making the decision of acquire
such Series 200 - Notes. Included among these exemptions are: PTCE 96-23,
regarding transactions affected by in-house asset managers; PTCE 95-60,
regarding investments by insurance company general accounts; PTCE 90-1,
regarding investments by insurance company pooled separate accounts; PTCE 91-38,
regarding investments by bank collective investment funds; and PTCE 84-14,
regarding transactions effected by 'qualified professional asset managers.' For
additional information regarding treatment of the Series 200 - Notes under
ERISA, See 'ERISA Considerations' in the prospectus.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
(the 'UNDERWRITING AGREEMENT'), the Transferor has agreed to cause the Trust to
sell to (the 'UNDERWRITER'), and the Underwriter has agreed to
purchase, Class A Notes in the principal amount of $ and Class B Notes in
the principal amount of $ .
In the Underwriting Agreement, the Underwriter has agreed, subject to the
terms and conditions set forth therein, to purchase all the Series 200 - Notes
offered hereby if any Series 200 - Notes are purchased.
The Transferor has been advised that the Underwriter proposes initially to
offer the Class A Notes and Class B Notes to the public at the public offering
prices set forth on the cover page of this prospectus supplement, and to certain
dealers at such prices less a concession not in excess of % per Class A
Note denominations and % per Class B Note denominations. The Underwriter may
allow, and such dealers may reallow, a concession not in excess of % per
Class A Note denominations and % per Class B Note denominations. After the
initial pubic offering, the public offering price and such concessions may be
changed.
The Underwriting Agreement provides that the Transferor and World Omni will
indemnify the Underwriter against certain liabilities, including liabilities
under applicable securities laws, or contribute to payments the Underwriter may
be required to make in respect thereof.
In the ordinary course of its business, the Underwriter and certain of its
affiliates have engaged and in the future may engage in investment banking
transactions with the Transferor and its affiliates.
The Underwriter intends to make a secondary market in the Series 200 -
Notes, but has no obligation to do so. There can be no assurance that a
secondary market for the Series 200 - Notes will develop or, if it does develop,
that it will continue or that it will provide holders of the Series 200 - Notes
with a sufficient level of liquidity of, or trading markets for, the Series
200 - Notes.
In order to facilitate the offering of the Series 200 - Notes, the
Underwriter may engage in transactions that stabilize, maintain or otherwise
affect the price of the Series 200 - Notes. Specifically, the Underwriter may
overallot in connection with the offering, creating a short position in the
Series
S-34
<PAGE>
200 - Notes for its own account. In addition, to cover overallotments or to
stabilize the price of the Series 200 - Notes, the Underwriter may bid for, and
purchase, the Series 200 - Notes in the open market. Any of these activities may
stabilize or maintain the market price of the 200 - Notes above independent
market levels. The Underwriter is not required to engage in these activities,
and may end any of these activities at any time.
LEGAL MATTERS
In addition to the legal opinions described in the prospectus, certain
legal matters relating to the Series 200 - Notes will be passed upon for the
Underwriters by .
S-35
<PAGE>
INDEX OF TERMS
The following is a list of the defined terms used in this prospectus
supplement and the pages on which the definitions of such terms may be found in
this prospectus supplement.
<TABLE>
<S> <C>
Accumulation Period....................... S-16
Accumulation Period Commencement Date..... S-16
Accumulation Period Length................ S-16
Additional Noteholder Collections......... S-27
Additional Noteholder Non-Principal
Collections............................. S-27
Additional Noteholder Principal
Collections............................. S-27
Administrator............................. S-5
Assets Receivables Rate................... S-9, S-27
Available Noteholder Principal
Collections............................. S-28
Available Subordinated Amount............. S-20
Calculation Agent......................... S-28
Carry-over Amount......................... S-15
Certificateholder Percentage.............. S-28
Class A Carry-over Amount................. S-15
Class A Controlled Accumulation Amount.... S-28
Class A Controlled Deposit Amount......... S-28
Class A Initial Invested Amount........... S-28
Class A Invested Amount................... S-28
Class A Monthly Interest.................. S-28
Class A Note Rate......................... S-15
Class A Noteholder Charge-Off............. S-23
Class A Noteholders....................... S-14
Class A Stated Maturity Date.............. S-24
Class B Carry-over Amount................. S-15
Class B Controlled Accumulation Amount.... S-29
Class B Controlled Deposit Amount......... S-29
Class B Initial Invested Amount........... S-29
Class B Invested Amount................... S-29
Class B Monthly Interest.................. S-29
Class B Note Rate......................... S-15
Class B Noteholder Charge-Off............. S-23
Class B Noteholders....................... S-14
Class B Stated Maturity Date.............. S-25
Deficiency Amount......................... S-19
Excess Certificateholder Percentage....... S-29
Excess Reserve Fund Required Amount....... S-20
Expected Principal Payment Date........... S-13
Floating Allocation Percentage............ S-29
Incremental Subordinated Amount........... S-30
Indenture Trustee......................... S-5
Initial Invested Amount................... S-30
Interest Period........................... S-14
Invested Amount........................... S-30
Investment Proceeds....................... S-30
Issuer.................................... S-5
LIBOR..................................... S-30
LIBOR Business Day........................ S-30
LIBOR Determination Date.................. S-30
Loan Rule................................. S-33
Monthly Dilution Amount................... S-30
Monthly Interest.......................... S-31
Note Rate................................. S-15
Noteholder Charge-Off..................... S-23
Noteholder Charge-Off Reversal Amount..... S-18
Noteholder Default Amount................. S-31
Noteholder Monthly Servicing Fee.......... S-31
Noteholder Non-Principal Collections...... S-31
Noteholder Principal Collections.......... S-31
OID....................................... S-33
Owner Trustee............................. S-5
Payment Date Statement.................... S-26
Pool of Accounts.......................... S-10
Principal Allocation Percentage........... S-31
Principal Funding Account................. S-26
Principal Funding Account Balance......... S-26
Principal Shortfalls...................... S-21
QSI....................................... S-33
Record Date............................... S-22
Required Draw Amount...................... S-19
Required Participation Percentage......... S-31
Required Subordinated Amount.............. S-31
Reserve Fund.............................. S-19
Reserve Fund Deposit Amount............... S-19
Reserve Fund Required Amount.............. S-19
Revolving Period.......................... S-15
Series 200 Noteholders.................... S-14
</TABLE>
S-36
<PAGE>
<TABLE>
<S> <C>
Series Cut-off Date....................... S-5
Series Issuance Date...................... S-5
Series Supplement......................... S-14
Servicer.................................. S-5
Subordinated Percentage................... S-31
Subordination Factor...................... S-31
Target Invested Amount.................... S-31
Telerate Page 3750........................ S-30
Transferor................................ S-5
Trust..................................... S-5
Underwriter............................... S-34
Underwriting Agreement.................... S-34
Weighted Average Floating Allocation
Percentage.............................. S-32
</TABLE>
S-37
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the estimated expenses in connection with
the issuance and distribution of the securities being registered, other than
underwriting discounts and commissions.
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee........................ $ 264,014
Accounting fees and expenses............................................... $ 100,000
Legal fees and expenses.................................................... $ 500,000
Trustee's fees and expenses................................................ $ 80,000
Printing and engraving..................................................... $ 100,000
Blue sky fees and expenses (including counsel)............................. $ 30,000
Rating Agency Fees......................................................... $ 600,000
Miscellaneous.............................................................. $ 40,000
----------
Total.................................................................... $1,714,014
----------
----------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
WODFI LLC was formed under the laws of Delaware. The limited liability
company agreement of WODFI LLC provides, in effect, that, subject to certain
limited exceptions, it will indemnify its members, directors or officers and may
indemnify any employee or agent of WODFI LLC who was or is a party or is
threatened to be made a party to a threatened, pending, or completed action,
suit, or proceeding (whether civil, criminal, administrative, or investigative
and whether formal or informal) other than an action by or in the right of WODFI
LLC, where such person is a party because such person is or was a member,
director, officer, employee, or agent of the WODFI LLC. WODFI LLC's limited
liability company agreement also provides that it will generally indemnify its
members and directors against expenses, including, attorney fees, judgments,
penalties, fines and amounts paid in settlement actually and reasonably incurred
by a director in connection with an action, suit or proceeding relating to acts
or omissions of that director regarding specified items relating to bankruptcy
and insolvency.
In general, WODFI LLC will indemnify its members, directors or officers and
may indemnify its employees or agents against expenses, including attorneys
fees, judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with an action, suit or
proceeding. To the fullest extent permitted by law, WODFI LLC will also
indemnify such member, director or officer and may indemnify such employee or
agent if the person acted in good faith and did not engage in willful misconduct
or gross negligence. With respect to a criminal action or proceeding, the person
must have had no reasonable cause to believe his misconduct was unlawful. Unless
ordered by a court, certain indemnifications shall be made by WODFI LLC only as
it authorizes in the specific case after (1) determining that the
indemnification is proper under the circumstances because the person to be
indemnified has met the applicable standard of conduct and (2) evaluating the
reasonableness of the expenses and of the amounts paid in settlement. This
determination and evaluation shall be made by a majority vote of the
disinterested members or, if there is only one member, by that member. However,
no indemnification shall be provided to any member, director, officer, employee,
or agent of WODFI LLC for or in connection with (1) the receipt of a financial
benefit to which the person is not entitled; (2) voting for or assenting to a
distribution to members in violation of the limited liability company agreement
or the Delaware Limited Liability Company Act; (3) a knowing violation of law;
or (4) acts or omissions of such person constituting willful misconduct or gross
negligence. To the extent that a
II-1
<PAGE>
member, director, officer, employee, or agent of WODFI LLC has been successful
on the merits or otherwise in defense of an action, suit, or proceeding or in
defense of any claim, issue, or other matter in such action, suit or proceeding,
such person shall be indemnified against actual and reasonable expenses,
including reasonable attorney fees, incurred by such person in connection with
the action, suit, proceeding and any action, suit or proceeding brought to
enforce such mandatory indemnification.
In addition, no Member, director or officer of WODFI LLC shall be liable to
WODFI LLC or any other person who has an interest in WODFI LLC for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such member, director or officer in good faith on behalf of WODFI LLC and in
a manner reasonably believed to be within the scope of the authority conferred
on such member, director or officer by the limited liability company agreement
of WODFI LLC, except that a member, director or officer shall be liable for any
such loss, damage or claim incurred by reason of such member's, director's or
officer's willful misconduct or gross negligence.
Insofar as indemnification by WODFI LLC for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of WODFI LLC pursuant to the foregoing provisions, WODFI LLC has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable.
WODFI LLC also maintains insurance providing for payment, subject to
certain exceptions, on behalf of officers, directors and managers of WODFI LLC
and its subsidiaries of money damages incurred as a result of legal actions
instituted against them in their capacities as such officers, directors or
managers (whether or not such person could be indemnified against such expense,
liability or loss under the Delaware Limited Liability Company Act).
Each underwriting agreement will provide that the underwriter will
indemnify WODFI LLC against specified liabilities, including liabilities under
the Securities Act of 1933.
ITEM 16. EXHIBITS.
(a) Exhibits:
The exhibits to this Registration Statement are listed in the Exhibit
Index below.
(b) Financial Statements Schedules: Not applicable with respect to the
Registrant.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(a) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, unless the information required to be included in
such post-effective amendment is contained in a periodic report filed with
or furnished to the Securities and Exchange Commission by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 and incorporated herein by reference;
(b) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
II-2
<PAGE>
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Securities and
Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the 'Calculation of
Registration Fee' table in the effective registration statement, unless the
information required to be included in a post-effective amendment is
contained in periodic reports filed by the registrant pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated herein by reference;
(c) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof;
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in this registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described in Item 15 above, 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 Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the 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 of whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
The registrant hereby undertakes to file an application for the purpose of
determining the eligibility of the Indenture Trustee to act under subsection (a)
of Section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Securities and Exchange Commission under Section
305(b)(2) of the Trust Indenture Act.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Deerfield Beach, State of
Florida, on March 7, 2000.
WODFI LLC
As originator of the Trust described
herein and registrant
By: /s/ A. TUCKER ALLEN
______________________________
A. Tucker Allen
Vice President and Treasurer
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
- ------------------------------------------ --------------------------------------------------- ---------------
<C> <S> <C>
/s/ A. TUCKER ALLEN Vice President and Treasurer March 7, 2000
----------------------- (principal financial and accounting officer)
A. Tucker Allen
PATRICA G. MORAN* Director March 7, 2000
------------------------
Patrica G. Moran
COLIN W. BROWN* Director March 7, 2000
------------------------
Colin W. Brown
LOUIS R. FEAGLES* President (principal executive officer) March 7, 2000
------------------------ and Director
Louis R. Feagles
JEFFREY B. SHAPIRO* Director March 7, 2000
------------------------
Jeffrey B. Shapiro
CHRISTOPHER C. WHEELER* Director March 7, 2000
---------------------------
Christopher C. Wheeler
</TABLE>
* The undersigned, by signing his name hereto, does hereby sign this
Amendment No. 1 to Registration Statement on behalf of each of the above
indicated officers and directors of the Registrant pursuant to the power of
attorney signed by such officers and directors.
By: /s/ A. TUCKER ALLEN
--------------------------------
A. Tucker Allen
Attorney-in-Fact
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -------------------------------------------------------------------------------------------------------
<C> <S> <C>
1.1 -- Form of Underwriting Agreement for Notes.
3.1 -- Certificate of Formation of WODFI LLC.
3.2 -- Form of Second Amended and Restated Limited Liability Company Agreement of WODFI LLC.
4.1 -- Form of Amended and Restated Indenture between the Trust and the Indenture Trustee.
4.2 -- Form of Series Supplement
5.1 -- Opinion of Kirkland & Ellis with respect to legality.
8.1 -- Opinion of Kirkland & Ellis with respect to tax matters.
*24.1 -- Power of Attorney (included on page II-4 of original filing).
**25.1 -- Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of the Indenture Trustee.
99.1 -- Form of Amended and Restated Trust Sale and Servicing Agreement between WODFI LLC, World Omni Financial
Corp. and the Trust.
99.2 -- Form of Amended and Restated Receivables Purchase Agreement between World Omni Financial Corp. and
WODFI LLC.
99.3 -- Administration Agreement between World Omni Financial Corp., the Trust and the Indenture Trustee.
99.4 -- Trust Agreement between WODFI LLC and the Trust.
</TABLE>
- ------------------
* Previously filed.
** To be filed in accordance with Section 305 of the Trust Indenture Act.
II-5
WORLD OMNI MASTER OWNER TRUST, SERIES 2000-1
$----------
[___%] [Floating Rate] Asset Backed Notes, Class A
$----------
[___%] [Floating Rate] Asset Backed Notes, Class B
UNDERWRITING AGREEMENT
February [__], 2000
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
[As Representative of the
Several Underwriters]
World Financial Center
North Tower
New York, New York 10281-1201
Dear Sirs:
1. Introductory. World Omni Master Owner Trust (the "Issuer" or the
"Trust"), a Delaware business trust, WODFI LLC, a Delaware limited liability
company (the "Transferor") and World Omni Financial Corp. ("World Omni"), a
Florida corporation, hereby confirm their respective agreements with you [and
each of the other underwriters named in Schedule I hereto] (the "Underwriters"),
[for whom you are acting as representative (the "Representative")], with respect
to the sale by the Issuer to the Underwriters of its $[__________] aggregate
principal amount of [____%] [Floating Rate] Asset Backed Notes, Class A (the
"Class A Notes") and [___________] aggregate principal amount of [___%]
[Floating Rate] Asset Backed Notes, Class B (the "Class B Notes" and, together
with the Class A Notes, the "Notes") under the terms and conditions herein
contained. The Class A Notes will bear an annual percentage rate equal to [__].
The Class B Notes will bear an annual percentage rate equal to [__].
Simultaneously with the issuance and sale of the Notes as contemplated herein,
the Issuer will also issue a Transferor Certificate (the "Transferor
Certificate"), evidencing the undivided ownership interest in the Issuer.
The Issuer was created as a Delaware business trust under the Trust
Agreement (the "Trust Agreement"), dated as of November 22, 1999, between the
Transferor and
1
<PAGE>
Chase Manhattan Bank Delaware, as owner trustee (in such capacity, the "Owner
Trustee"). The Notes will be issued pursuant to an indenture, dated as of
November 22, 1999 (the "Indenture"), between the Issuer and Harris Trust &
Savings Bank, as indenture trustee (in such capacity, the "Indenture Trustee"),
as supplemented by the Series 2000-1 Supplement (the "Series Supplement"), dated
as of February [__], 2000, between the Issuer and the Indenture Trustee. The
Notes will be secured by the Collateral pledged to the Indenture Trustee under
the Indenture. The Collateral includes, among other things, wholesale
receivables generated by World Omni from time to time in certain revolving
financing arrangements with automobile dealers to finance their automobile,
light duty truck and other motor vehicle inventory and collections on the
Receivables. Certain Receivables existing at the opening of business on November
22, 1999 (the "Initial Closing Date") have been, and substantially all
Receivables arising thereafter have been and will continue to be, sold,
assigned, transferred and conveyed by World Omni to the Transferor pursuant to
the Receivables Purchase Agreement (the "RPA"), dated as of November 22, 1999,
between World Omni and the Transferor. The Transferor has sold, assigned,
transferred and conveyed such property to the Issuer pursuant to the Trust Sale
and Servicing Agreement (the "Sale and Servicing Agreement"), dated as of
November 22, 1999, among World Omni, the Transferor and the Issuer and the
Issuer has pledged such property to the Indenture Trustee. Capitalized terms
used herein that are not otherwise defined shall have the meanings ascribed
thereto in Appendix A to the Sale and Servicing Agreement.
The Trust Agreement, the Sale and Servicing Agreement, the Indenture,
the Series Supplement, the RPA, the [Swap Agreement] and the Administration
Agreement (the "Administrative Agreement"), dated as of November 22, 1999, among
the Issuer, World Omni and the Indenture Trustee, are referred to herein
collectively as the "Basic Documents".
2. Representations and Warranties of the Issuer, Word Omni and the
Transferor.
---------------------------------------------------------------
(a) Each of the Issuer, World Omni and the Transferor, jointly and
severally, represents and warrants to, and agrees with, each of the Underwriters
that:
(i) A registration statement on Form S-3 (No. 333-______),
including a form of prospectus, relating to the registration of the Notes has
been filed with the Securities and Exchange Commission (the "Commission") and,
the offering thereof from time to time in accordance with Rule 415 of the rules
and regulations of the Commission, either (1) has been declared effective under
the Securities Act of 1933, as amended (the "Act"), and is not proposed to be
amended or (2) is proposed to be amended by amendment or post-effective
amendment. If the Issuer does not propose to amend such registration statement
and if any post-effective amendment to such registration statement has been
filed with the Commission prior to the execution and delivery of this Agreement,
the most recent such post-effective amendment has been declared effective by the
Commission. For purposes of this Agreement, "Effective Time" means if the
Transferor and Issuer have advised the Representative that they (1) do not
propose to amend such registration statement, the date and time as of which such
registration statement, or the most recent post-effective amendment thereto (if
any) filed prior to the
2
<PAGE>
execution and delivery of this Agreement, was declared effective by the
Commission or (2) propose to file an amendment or post-effective amendment to
such registration statement, the date and time as of which such registration
statement, as amended by such amendment or post-effective amendment, as the case
may be, is declared effective by the Commission. "Effective Date" means the date
of the Effective Time. Such registration statement, as amended at the Effective
Time, including all information, if any, deemed to be a part of such
registration statement as of the Effective Time pursuant to Rule 430A(b) under
the Act, and including the exhibits thereto, is hereinafter referred to as the
"Registration Statement", and the form of prospectus relating to the Notes, in
the form transmitted to the Commission for filing pursuant to and in accordance
with Rule 424(b) under the Act ("Rule 424(b)"), or (if no such filing is
required) as included in the Registration Statement, is hereinafter referred to
as the "Prospectus". The Prospectus delivered to you for use in connection with
the offering of the Notes will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval ("EDGAR") system, except to the extent
permitted by Regulation S-T.
(ii) If the Effective Time is prior to the execution and delivery
of this Agreement: (A) on the Effective Date, the Registration Statement
conformed, and on the date of this Agreement the Registration Statement will
conform in all material respects with the requirements of the Act and the rules
and regulations of the Commission promulgated under the Act (the "Rules and
Regulations") and at such times did not include any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading and (B) on the date
of this Agreement, at the time of the filing of the Prospectus pursuant to Rule
424(b) and at the Closing Date (as such term is defined in Section 3 hereof),
the Prospectus will conform in all material respects to the requirements of the
Act and the Rules and Regulations and does not include, or will not include, any
untrue statement of a material fact, nor does the Prospectus omit, nor will it
omit, any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading. If
the Effective Time is subsequent to the execution and delivery of this
Agreement: (A) on the Effective Date, the Registration Statement and the
Prospectus will conform in all material respects to the requirements of the Act
and the Rules and Regulations and the Registration Statement will not include
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading and (B) on the Effective Date, at the time of the filing of the
Prospectus pursuant to Rule 424(b), if required, and at the Closing Date, the
Prospectus will not include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading. The
two immediately preceding sentences do not apply to statements in or omissions
from the Registration Statement or Prospectus based upon written information
furnished to the Transferor and the Issuer by any Underwriter through the
Representative specifically for use therein. The Prospectus delivered to you for
use in connection with the offering of the Notes will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
the EDGAR system, except to the extent permitted by Regulation S-T.
3
<PAGE>
(iii) The Basic Documents conform in all material respects to the
descriptions thereof and the statements in relation thereto contained in the
Prospectus.
(iv) The Notes conform in all material respects to the
description thereof and the statements in relation thereto contained in the
Prospectus; the Notes have been duly and validly authorized and, when executed,
issued, authenticated and delivered in accordance with the Indenture and when
delivered to the Underwriters, against payment of the consideration specified
herein, will be duly and validly issued and outstanding and entitled to the
benefits of the Indenture.
(v) None of the Issuer, Transferor or World Omni is now or, as a
result of the transactions contemplated by this Agreement, will become, an
"investment company", nor is any of them "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act").
(vi) As of the Closing Date, (A) each representation and warranty
of World Omni in the RPA will be true and correct, each Underwriter may rely on
such representations and warranties and neither World Omni nor the Transferor
will be in breach of the RPA; (B) each representation and warranty of the
Transferor and World Omni in the Sale and Servicing Agreement will be true and
correct, each Underwriter may rely on such representations and warranties and
neither World Omni, the Transferor nor the Trust will be in breach of the Sale
and Servicing Agreement; (C) each representation and warranty of the Issuer and
the Indenture Trustee in the Indenture will be true and correct, each
Underwriter may rely on such representations and warranties and neither the
Issuer nor the Indenture Trustee will be in breach of the Indenture; and (D)
each representation and warranty of the Transferor and the Owner Trustee in the
Trust Agreement will be true and correct, each Underwriter may rely on such
representations and warranties and neither the Transferor nor the Owner Trustee
will be in breach of the Trust Agreement.
(vii) As of the Closing Date, the representations and warranties
in Officer's Certificates of any of the Issuer, Word Omni or the Transferor
delivered on the Initial Closing Date, the Closing Date or on each Transfer
Date, as the case may be, will be true and correct, and each Underwriter may
rely on such representations and warranties as if they were set forth herein in
full.
(viii) [The Pool Balance as of February [__], 2000 (the "Closing
Date"), will be equal to at least $[_____________]].
(ix) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, except as otherwise set forth
therein, (A) there has been no material adverse change or development resulting
in a prospective material adverse change in the condition, financial or
otherwise, or business prospects, of World Omni, the Issuer or the Transferor,
whether or not arising in the ordinary course of business and (B) there have
been no transactions entered into by World Omni, the Issuer
4
<PAGE>
or the Transferor, other than those in the ordinary course of their respective
businesses, that are material with respect to World Omni, the Issuer or the
Transferor.
(x) The execution, delivery and performance by each of the
Issuer, World Omni and the Transferor, as the case may be, of this Agreement,
the Notes and the Transferor Certificate, the consummation of the transactions
contemplated herein and therein and compliance by it with its obligations
hereunder and thereunder have been duly and validly authorized by all necessary
action (corporate or otherwise) and will not conflict with or constitute a
breach of or default under, or result in the creation or imposition of any Lien
(except as permitted by the Basic Documents) upon any of its property or assets
pursuant to any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which it may be a party, by which it may be bound or to
which any of its properties or assets is subject, nor will such action result in
any violation of the provisions of its charter or organizational documents,
bylaws, or any applicable law, administrative regulation or administrative or
court decree.
(xi) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending or, to
the knowledge of any of the Issuer, World Omni or the Transferor threatened,
against or affecting the Issuer, World Omni or the Transferor, that is required
to be disclosed in the Registration Statement and that is not disclosed or that
might result in any material adverse change in its condition, financial or
otherwise, or in its earnings, business affairs or business prospects or that
might materially and adversely affect its properties or assets or that might
materially and adversely affect the consummation of this Agreement or any Basic
Document to which any of such entities is a party or by which it may be bound;
all pending legal or governmental proceedings to which the Issuer, World Omni or
the Transferor is a party or of which any of their respective properties or
assets is the subject that are not described in the Registration Statement,
including ordinary routine litigation incidental to their respective businesses,
are, considered in the aggregate, not material; and there are no contracts or
documents of the Issuer, World Omni or the Transferor, that are required to be
filed as exhibits to the Registration Statement by the Act or by the Rules and
Regulations that have not been so filed.
(xii) Except such as may be required by the Act, the Rules and
Regulations or state securities laws, no authorization, approval or consent of
any court, governmental authority or agency or any other Person is necessary in
connection with (A) the issuance of the Notes and the Transferor Certificate or
the offering and sale of the Notes, (B) the execution, delivery and performance
by the Issuer, World Omni or the Transferor of this Agreement, any Basic
Document to which it is a party, the Notes or the Transferor Certificate or (C)
the consummation by the Issuer, World Omni or the Transferor of the transactions
contemplated hereby or thereby, except such authorizations, approvals or
consents as will have been obtained and are in full force and effect as of the
Closing Date.
(xiii) This Agreement has been duly executed and delivered by the
Issuer, World Omni and the Transferor.
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(xiv) As of the Closing Date, each of the Basic Documents to
which any of the Issuer, World Omni or the Transferor is a party has been duly
executed and delivered by each such entity, as applicable, and, assuming the due
authorization, execution and delivery thereof by the other parties thereto, will
constitute the legal, valid and binding agreement of the Issuer, World Omni or
the Transferor, as the case may be, enforceable in accordance with its terms,
except as the enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, reorganization or other similar laws affecting enforcement of
creditors' rights generally and by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
(xv) The Issuer will use the proceeds of the Notes as described
in the Prospectus under the caption "Use of Proceeds".
(xvi) None of the Issuer, World Omni or the Transferor conducts
business or has affiliates who conduct business in Cuba or with the government
of Cuba within the meaning of Section 517.075 of the Florida Securities and
Investors Protection Act or Regulation Section 3E-900.001 promulgated
thereunder.
(xvii) World Omni is current in the payment of taxes to the State
of Florida and fees to the Florida Department of State and its status is
"active" and each of the Issuer and the Transferor is current in the payment of
any taxes required to be paid by it.
(xviii) Each of the Issuer, World Omni and the Transferor has
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and to enter into and to
perform its obligations under this Agreement and each Basic Document to which it
is a party or by which it may be bound.
(b) Any Officer's Certificate signed by any officer of the Issuer,
World Omni or the Transferor and delivered to the Representative or counsel for
the Underwriters shall be deemed a representation and warranty of the Issuer,
World Omni or the Transferor, as the case may be, to each Underwriter as to the
matters covered thereby.
3. Purchase, Sale and Delivery of the Notes. On the basis of and in
reliance on the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Issuer agrees to sell
to each Underwriter, severally and not jointly, and each Underwriter, severally
and not jointly, agrees to purchase from the Issuer the aggregate principal
amount of each Class of Notes set forth in Schedule I opposite the name of such
Underwriter, at a purchase price equal to the following percentages of the
aggregate initial principal balances thereof, (i) in the case of the Class A
Notes, [____]% and (ii) in the case of the Class B Notes, [____]%.
Each Class of Notes will initially be represented by one or more notes
registered in the name of Cede & Co., as the nominee of The Depository Trust
Company ("DTC"). The interests of beneficial owners of each Class of Notes will
be represented by book entries on the records of DTC and participating members
thereof. Definitive instruments
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evidencing the Notes will be available only under the limited circumstances
specified in the Indenture.
The Transferor will deliver the Notes to the Representative for the
respective accounts of the Underwriters, against payment of the purchase price
therefor in immediately available funds payable to the order of the Issuer, at
the office of Kirkland & Ellis, 200 East Randolph Drive, Chicago, Illinois 60601
(or at such other location as agreed upon among World Omni and the
Representative) at 10:00 A.M., New York time, on February [__], 2000, or at such
other time not later than five full business days thereafter, as World Omni and
the Representative determine, such time being herein referred to as the "Closing
Date". The instruments evidencing the Notes and the Transferor Certificate will
be made available for inspection at the above offices of Kirkland & Ellis (or at
such other location agreed upon among World Omni and the Representative) at
least 24 hours prior to the Closing Date.
Pursuant to Rule 15c6-1(d) under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), the Issuer, World Omni, the Transferor and the
Underwriters have agreed that the Closing Date will be not less than nine
business days following the date hereof. The Issuer, World Omni, and the
Underwriters further agree that upon receipt by an investor who has received an
electronic Prospectus or a request by such investor's representative (whether
such request is delivered to an Underwriter, the Issuer, World Omni or the
Transferor during the period during which there is an obligation to deliver a
Prospectus, the Underwriters will promptly deliver or cause to be delivered
without charge, a paper copy of the Prospectus.
4. Certain Agreements of the Underwriters.
--------------------------------------
(a) It is understood that the Underwriters propose to offer the Notes
for sale to the public as set forth in the Prospectus.
(b) The Underwriters covenant and agree that prior to the date which
is one year and one day after the last date upon which (i) each Class of Notes
has been paid in full, and (ii) all obligations of the Issuer due under any
other Series Supplement have been paid in full, the Underwriters will not
institute against, or join any other Person in instituting against, the Issuer,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceeding under any federal or state bankruptcy or similar
law. The foregoing shall not limit the right of any Underwriter to file any
claim in or otherwise take actions with respect to any such proceeding
instituted by any Person not under such a constraint.
(c) Until the Representative informs the Issuer in writing that all
of the Notes have been sold by the Underwriters, each Underwriter covenants and
agrees to provide to the Issuer each day, with respect to sales of the Notes
made by such Underwriter on such date at any price other than the public
offering price set forth on the cover page of the Prospectus, the information in
writing (which may be in the form of a telecopy) necessary to enable the Issuer
to prepare and file or transmit for filing with the Commission the
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information requested by the Commission to be filed with respect to the
distribution of the Notes.
5. Certain Agreements of the Transferor, the Issuer and World Omni. Each
of the Issuer, World Omni and the Transferor jointly and severally covenants and
agrees with each of the Underwriters that:
(a) If the Effective Time is prior to the execution and delivery of
this Agreement, the Transferor and the Issuer will file the Prospectus with the
Commission pursuant to and in accordance with subparagraph (1) (or, if
applicable and if consented to by the Representative, subparagraph (4)) of Rule
424(b), not later than the second business day following the execution and
delivery of this Agreement. The Transferor and the Issuer will advise the
Representative promptly of any such filing pursuant to Rule 424(b).
(b) The Transferor and the Issuer will advise the Representative
promptly of any proposal to amend or supplement the registration statement as
filed or the related prospectus or the Registration Statement or the Prospectus
and will not effect any such amendment or supplement without the consent of the
Representative. The Transferor and the Issuer will advise the Representative
promptly of the effectiveness of the Registration Statement (if the Effective
Time is subsequent to the execution and delivery of this Agreement), of any
amendment or supplement of the Registration Statement or the Prospectus and of
the institution by the Commission of any stop order proceedings in respect of
the Registration Statement. The Transferor and the Issuer will use their best
efforts to prevent the issuance of any such stop order and to obtain as soon as
possible its lifting, if issued. The Transferor and the Issuer will comply with
the Act, the Exchange Act, the Trust Indenture Act of 1939, as amended and the
rules and regulations contemplated thereunder so as to permit the completion of
the distribution of the Notes as contemplated in this Agreement and in the
Prospectus. The Transferor and the Issuer will file with the Commission all
documents required to be filed pursuant to the Exchange Act within the time
periods specified in the Exchange Act or the rules and regulations promulgated
thereunder.
(c) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue statement
of a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend or supplement
the Prospectus to comply with the Act, the Transferor and the Issuer promptly
will prepare and file, or cause to be prepared and filed, with the Commission an
amendment or supplement that will correct such statement or omission or effect
such compliance. Neither the consent of the Representative to, nor the delivery
by any Underwriter of, any such amendment or supplement shall constitute a
waiver of any of the conditions set forth in Section 6 hereof.
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Transferor and the Issuer will cause [the Indenture
Trustee] to make generally
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available to the Noteholders an earnings statement with respect to the Issuer
covering a period of at least 12 months beginning after the Effective Date that
will satisfy the provisions of Section 11(a) of the Act. For the purpose of the
preceding sentence, "Availability Date" means the 45th day after the end of the
fourth fiscal quarter following the fiscal quarter that includes the Effective
Date, except that, if such fourth fiscal quarter is the last quarter of the
fiscal year of the Transferor and the Issuer, "Availability Date" means the 90th
day after the end of such fourth fiscal quarter.
(e) The Transferor and the Issuer will furnish to the Representative
copies of the registration statement as originally filed with the Commission and
each amendment thereto (in each case at least one of which will be signed and
will include all exhibits), each related preliminary prospectus, the Prospectus
and all amendments and supplements to such documents, in each case as soon as
available and in such quantities as the Representative may reasonably request.
(f) The Transferor and the Issuer will arrange for the qualification
of the Notes for sale under the laws of such jurisdictions in the United States
as the Representative may designate and will continue such qualifications in
effect so long as required for the distribution of the Notes, provided that
neither the Transferor nor the Issuer shall be obligated to qualify to do
business nor become subject to service of process generally, but only to the
extent required for such qualification, in any jurisdiction in which it is not
currently so qualified.
(g) So long as any Notes are outstanding, the Transferor, the Issuer
or World Omni, as the case may be, will make good faith efforts to deliver or
cause to be delivered to the Representative, as soon as each becomes available,
copies of (i) each report relating to the Notes required to be prepared under
Sections 7.3 and 7.4 of the Indenture, (ii) the annual statement as to
compliance and the annual statement of a firm of independent public accountants
furnished pursuant to Section 3.09 of the Indenture and Section 3.6 of the Sale
and Servicing Agreement, respectively, (iii) each certificate or notice
delivered by the Servicer pursuant to Sections 3.4 and 3.5 of the Sale and
Servicing Agreement and Section 5.02 of the Series Supplement, (iv) each
periodic report required to be filed by the Transferor or the Issuer with the
Commission pursuant to the Exchange Act, or any order of the Commission
thereunder and (v) such other information concerning the Transferor, World Omni,
the Issuer, the Notes or the Transferor Certificate as the Representative may
reasonably request from time to time.
(h) The Issuer, World Omni and the Transferor will pay all expenses
incident to the performance of their respective obligations under this
Agreement, including without limitation, (i) expenses incident to the word
processing, printing and reproduction of the registration statement as
originally filed with the Commission and each amendment thereto, preliminary
prospectuses and the Prospectus (including any amendments and supplements
thereto), (ii) the fees and disbursements of the Indenture Trustee, the Owner
Trustee and their respective counsel, (iii) the fees and disbursements of
counsel and the independent public accountants of the Transferor, the Issuer and
World Omni, (iv) the fees charged by each of [Moody's Investors Service, Inc.
("Moody's") and Standard & Poor's Ratings Services, a division of The
McGraw-Hill
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<PAGE>
Companies, Inc. ("Standard & Poor's" and, together with Moody's, the "Rating
Agencies")] in connection with the rating of each Class of Notes, (v) the fees
of DTC in connection with the book-entry registration of the Notes and (vi)
expenses (including reasonable fees and disbursements of counsel) incurred by
the Underwriters pursuant to Section 5(f) hereof in connection with the
qualification of the Notes for sale under the laws of such jurisdictions in the
United States as the Representative may designate. If this Agreement is
terminated by the Representative in accordance with the provisions of Section 6
or clause (i) or clause (ii) of Section 10 hereof, the Transferor, the Issuer
and World Omni shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of counsel to the
Underwriters.
(i) For a period of 45 days from the date hereof, none of the
Transferor, the Issuer and World Omni or any of their respective affiliates
will, without the prior written consent of the Representative, directly or
indirectly, offer, sell or contract to sell or announce the offering of, in a
public or private transaction, any other collateralized securities similar to
the Notes.
(j) So long as any Notes are outstanding, the Transferor, the Issuer
and World Omni will cause to be delivered to the Representative a reliance
letter relating to each Opinion of Counsel delivered to the Owner Trustee, the
Indenture Trustee or any Rating Agency by counsel to the Transferor, the Issuer
or World Omni relating to the transactions contemplated by this Agreement or the
Basic Documents.
(k) To the extent, if any, that the rating provided with respect to
any Notes by any Rating Agency is conditional upon the furnishing of documents
or the taking of any other actions by the Transferor, the Issuer or World Omni,
the Transferor, the Issuer or World Omni, as the case may be, shall furnish such
documents and take any such other actions.
6. Conditions of the Obligations of the Underwriters. The obligation of
the several Underwriters to purchase and pay for the Notes will be subject to
the accuracy of the respective representations and warranties on the part of the
Transferor, the Issuer and World Omni herein, to the accuracy of the statements
of the respective officers of the Transferor, the Issuer and World Omni made
pursuant to the provisions hereof, to the performance by the Transferor, the
Issuer and World Omni of their respective obligations hereunder and to the
following additional conditions precedent:
(a) On (i) the date of this Agreement, the Representative, the Issuer
and the Transferor shall have received a letter or letters, dated the date of
delivery thereof (which, if the Effective Time is prior to the execution and
delivery of this Agreement, shall be on or prior to the date of this Agreement
or, if the Effective Time is subsequent to the execution and delivery of this
Agreement, shall be prior to the filing of the amendment or post-effective
amendment to the registration statement to be filed shortly prior to the
Effective Time), of Arthur Andersen LLP ("Arthur Andersen") confirming that they
are independent public accountants within the meaning of the Act and the Rules
and Regulations, substantially in the form of the draft or drafts to which the
Representative has previously agreed and otherwise in form and in substance
satisfactory to the
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Representative and counsel for the Underwriters and (ii) on the Closing Date,
the Representative. the Issuer and the Transferor shall have received a letter
or letters, dated as of the Closing Date, from Arthur Andersen, updating each
letter delivered pursuant to clause (i) above, in form and substance
satisfactory to the Representative and counsel for the Underwriters.
(b) If the Effective Time has not occurred prior to the date of this
Agreement, the Effective Time shall be the date of execution and delivery of
this Agreement, or the next business day after the date of this Agreement or
such later date as shall have been consented to by the Representative. If the
Effective Time is prior to the execution and delivery of this Agreement, the
Prospectus shall have been filed with the Commission in accordance with the
Rules and Regulations and Section 5(a) hereof. Prior to the Closing Date, no
stop order suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been instituted or,
to the knowledge of the Transferor, the Issuer, World Omni or the
Representative, shall be contemplated by the Commission.
(c) The Representative shall have received certificates of the
President, any Vice President or the Treasurer or any Assistant Treasurer of (i)
the Transferor on behalf of the Issuer, (ii) the Transferor and (iii) World
Omni, each dated the Closing Date, in which such officer shall state that (1)
the representations and warranties of the Issuer, the Transferor or World Omni,
as the case may be, in each Basic Document to which it is a party and in this
Agreement are true and correct, (2) to the best knowledge of such officer after
reasonable investigation, the Issuer, the Transferor or World Omni, as the case
may be, has complied with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder at or prior to the Closing Date, no
stop order suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or are
contemplated by the Commission and (3) subsequent to the date of this Agreement,
there has been no material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Issuer, the Transferor or World Omni, as the case may be, except as set forth in
or contemplated by the Prospectus.
(d) The Representative shall have received:
(i) The favorable opinion of Kirkland & Ellis, special counsel
to the Issuer, the Transferor and World Omni, dated the Closing Date and
satisfactory in form and substance to the Underwriter and counsel for the
Underwriter, and substantially to the effect that:
(1) Assuming the due authorization, execution and delivery
thereof by the other parties thereto, each Basic Document will constitute a
legal, valid and binding agreement of the Issuer, the Transferor and World Omni,
as the case may be, enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
reorganization or other similar laws affecting enforcement of creditors' rights
generally and by general principles of equity
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(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(2) The Notes are in due and proper form and (assuming the
Notes have been duly and validly authorized) when executed, authenticated and
delivered as specified in the Indenture and the Series Supplement and when
delivered to the Underwriters against payment of the consideration specified
herein, will be duly and validly issued and outstanding and entitled to the
benefits of the Indenture and the Series Supplement.
(3) The Notes and the Basic Documents each conform in all
material respects with the description thereof contained in the Registration
Statement and the Prospectus.
(4) The statements in the Prospectus under the captions
"Summary", "Risk Factors", "The Notes", "The Trust", "The Transfer and Servicing
Agreements", insofar as such statements purport to summarize certain terms or
provisions of the Notes, the Transferor Certificate and the Basic Documents,
provide a fair summary of such provisions, and the statements in the Prospectus
under "Risk Factors", "Certain Legal Aspects of the Receivables", "Certain
Federal Income Tax Considerations", and "ERISA Considerations", to the extent
that they constitute matters of law, summaries of legal matters, documents or
proceedings or legal conclusions relating to U.S. federal law have been prepared
or reviewed by such counsel and are correct in all material respects.
(5) The Indenture is not required to be qualified under the
Trust Indenture Act of 1939, as amended, and neither the Transferor nor the
Issuer is required to be registered under the Investment Company Act.
(6) No consent, approval, authorization or order of any
court or governmental agency or body is required for the consummation by either
the Transferor, the Issuer or World Omni of the transactions contemplated in
this Agreement or the Basic Documents except such as may be required under the
Act, the Rules and Regulations or state securities laws, and those
authorizations, approvals, consents and orders which have previously been
obtained and are in full force and effect as of the Closing Date; provided, that
such counsel need express no opinion as to state securities laws.
(7) The Registration Statement has become effective under
the Act, and, to the best of their knowledge and information, no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are pending or
contemplated under the Act, and the Registration Statement and the Prospectus,
and each amendment or supplement thereto, as of their respective effective or
issue dates, complied as to form in all material respects with the requirements
of the Act and the Rules and Regulations; such counsel has no reason to believe
that either the Registration Statement, at the Effective Time, or any such
amendment or supplement, as of its effective date, contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading, or
that the Prospectus, at the
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date of this Agreement (or any such amendment or supplement, as of its
respective date) or at the Closing Date, included or includes an untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; it being understood
that such counsel need express no opinion as to the financial statements or
other financial or statistical data contained in the Registration Statement or
the Prospectus.
(ii) The favorable opinion of [_______________], counsel to World
Omni, dated the Closing Date and satisfactory in form and substance to the
Underwriter and counsel for the Underwriter, and substantially to the effect
that:
(1) World Omni has been duly incorporated under the Florida
Business Corporation Act, is current in the payment of fees due to the Florida
Department of State, and its status is active; World Omni has the corporate
power and authority to own its properties and conduct its business as described
in the Prospectus and is qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify would not have a
material adverse effect on the condition, financial or otherwise, of Transferor.
(2) World Omni has the corporate power and authority to
execute, deliver and perform its obligations under the Basic Documents; and had
at all relevant times, and on the Closing Date has, the corporate power and
authority to acquire, own and transfer the Receivables and the other property
transferred by it to the Transferor pursuant to the Receivables Purchase
Agreement.
(3) World Omni has obtained all licenses and approvals
required for the conduct of its business or the ownership or leasing of its
property, to the extent that failure to obtain such licenses and approvals would
render any Receivable or any other material part of the corpus of the Trust
unenforceable or would materially and adversely affect the ability of World Omni
to perform any of its obligations under, or the enforceability of, any Basic
Document or this Agreement.
(4) This Agreement and each Basic Document has been duly
authorized, executed and delivered by World Omni, as applicable.
(5) None of (1) the transfer of the Receivables and the
other property of the Issuer transferred by World Omni to the Transferor
pursuant to the Receivables Purchase Agreement, (2) the compliance by World Omni
with all of the provisions of the Basic Documents or (3) the consummation of the
transactions herein and therein contemplated, will conflict with, result in a
breach of, or constitute a default under, or with the giving of notice or the
passage of time or both, would constitute a default under or result in the
creation or imposition of any Lien upon any property or assets of World Omni
pursuant to the terms of (i) its articles of incorporation or bylaws, (ii) to
the best of its knowledge and information and except as otherwise provided in
the
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Basic Documents, any contract, indenture, mortgage, loan agreement, note, lease
or other instrument (other than any document relating to any other supplement
for the Trust) to which World Omni is a party or by which it may be bound, or to
which any of the property or assets of World Omni is subject, or (iii) any
applicable law, statute or regulation or, to the best of their knowledge and
information, any judgment, order or decree applicable to World Omni of any
court, regulatory body or other governmental instrumentality having jurisdiction
over World Omni except, in the case of clause (ii) and the second part of clause
(iii) above, for defaults, breaches or violations that do not, in the aggregate,
have a material adverse effect on World Omni.
(6) To the best of its knowledge and information, (A) there
are no actions, proceedings or investigations pending or threatened required to
be disclosed in the Registration Statement, other than those disclosed therein,
(w) asserting the invalidity of this Agreement, any Basic Document or the Notes,
(x) seeking to prevent the issuance of the Notes or the consummation of any of
the transactions contemplated by this Agreement or the Basic Documents, (y) that
might materially and adversely affect the performance by World Omni of its
respective obligations under, or the validity or enforceability of, this
Agreement or any Basic Document or (z) seeking adversely to affect the federal
or state income tax attributes of the Notes as described in the Prospectus under
the heading "Certain Tax Matters", and (B) all pending legal or governmental
proceedings to which World Omni is a party or to which any of their property or
assets is subject that are not described in the Registration Statement,
including ordinary routine litigation incidental to the business, are,
considered in the aggregate not material.
(iii) The favorable opinion of [_________________], special
Delaware counsel to the Transferor, the Issuer and World Omni, dated the Closing
Date and satisfactory in form and substance to the Representative and counsel to
the Underwriters, to the effect that:
(1) The Transferor has been duly formed and is validly
existing in good standing as a limited liability company under the laws of the
State of Delaware with all requisite power under the laws of the State of
Delaware to enter into and perform its obligations under this Agreement and each
Basic Document to which it is a party.
(2) The Issuer has been duly formed and is validly existing
in good standing as a business trust under the laws of the State of Delaware
with all requisite power under the laws of the State of Delaware to enter into
and perform its obligations under this Agreement and each Basic Document to
which it is a party.
(3) The execution and delivery of and performance under
each Basic Document to which the Transferor and the Issuer is a party (A) have
been duly authorized by all requisite action on the part of the Transferor and
the Issuer, as applicable, (B) are permitted under the laws of the State of
Delaware and (C) will not violate any Delaware statute or regulation; provided
that such counsel need express no opinion regarding state securities laws.
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(4) No consent, approval, authorization or order of, or
registration or filing or declaration with, any Delaware court or governmental
agency or body is required in connection with either the Transferor's or the
Issuer's execution or delivery of or performance under each Basic Document to
which it is a party.
(5) The Transferor has the corporate power and authority to
execute, deliver and perform its obligations under this Agreement, the Notes and
the Basic Documents, to authorize, exececute and cause the Notes to be issued
and to sell the Notes to the Underwriter and had at all relevant times, and on
the Closing Date has, the corporate power and authority to acquire, own and
transfer the Receivables and the other property to be transferred by it to the
Issuer pursuant to the Sale and Servicing Agreement.
(6) The Issuer has the corporate power and authority to
execute, deliver and perform its obligations under this Agreement, the Notes and
the Basic Documents, to authorize, exececute and cause the Notes to be issued
and to sell the Notes to the Underwriter and had at all relevant times, and on
the Closing Date has, the corporate power and authority to acquire, own and
pledge the Receivables and the other property to be pledged by it to the
Indenture Trustee pursuant to the Indenture.
(7) The Transferor and the Issuer have obtained all
licenses and approvals required to be obtained by the Transferor and the Issuer,
respectively, whether by reason of the ownership or leasing of property or the
conduct of business, to the extent that the failure to obtain such licenses and
approvals would render any Receivable or any other material part of the corpus
of the Trust unenforceable or would materially and adversely affect the ability
of the Transferor or the Issuer, respectively, to perform its obligations under,
or the enforceability of, the Notes or any Basic Document.
(8) None of (1) the transfer of the Receivables to the
Issuer, (2) the issuance of the Notes, (3) the sale of the Notes, (4) the
execution and delivery of the Notes, the Basic Documents or this Agreement, (5)
the consummation of any other of the transactions contemplated herein or therein
or (6) the fulfillment of the terms of the Notes, the Basic Documents or this
Agreement by the Transferor will conflict with, result in a breach of, or
constitute a default under, or with the giving of notice or the passage of time
or both, would constitute a default under or result in the creation or
imposition of any Lien upon any property or assets of the Transferor pursuant to
the terms of (i) its limited partnership agreement or other organizational
documents, (ii) to the best of its knowledge and information and except as
otherwise provided in the Basic Documents, any contract, indenture, mortgage,
loan agreement, note, lease or other instrument (other than any document
relating to any other supplement for the Trust) to which the Transferor is a
party or by which it may be bound, or to which any of the property or assets of
the Transferor is subject, or (iii) to the best of its knowledge and
information, any applicable law, statute or regulation, judgment, order or
decree applicable to the Transferor of any court, regulatory body or other
governmental instrumentality having jurisdiction over the Transferor except, in
the case of clause (ii) and (iii) above, for defaults, breaches or violations
that do not, in the aggregate, have a material adverse effect on the Transferor.
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(9) None of (1) the transfer of the Receivables to the
Indenture Trustee, (2) the assignment of the security interest of the Transferor
in the Collateral, (3) the issuance of the Notes, (4) the sale of the Notes, (5)
the execution and delivery of the Notes, the Basic Documents or this Agreement,
(6) the consummation of any other of the transactions contemplated herein or
therein or (7) the fulfillment of the terms of the Notes, the Basic Documents or
this Agreement by the Issuer will conflict with, result in a breach of, or
constitute a default under, or with the giving of notice or the passage of time
or both, would constitute a default under or result in the creation or
imposition of any Lien upon any property or assets of the Issuer pursuant to the
terms of (i) to the best of its knowledge and information and except as
otherwise provided in the Basic Documents, any contract, indenture, mortgage,
loan agreement, note, lease or other instrument (other than any document
relating to any other supplement for the Trust) to which the Transferor is a
party or by which it may be bound, or to which any of the property or assets of
the Transferor is subject, or (ii) to the best of its knowledge and information,
any applicable law, statute or regulation, judgment, order or decree applicable
to the Issuer of any court, regulatory body or other governmental
instrumentality having jurisdiction over the Issuer except, in the case of
clause (iii) above, for defaults, breaches or violations that do not, in the
aggregate, have a material adverse effect on the Issuer.
(10) To the best of its knowledge and information, (A) there
are no actions, proceedings or investigations pending or threatened required to
be disclosed in the Registration Statement, other than those disclosed therein,
(w) asserting the invalidity of this Agreement, any Basic Document or the Notes,
(x) seeking to prevent the issuance of the Notes or the consummation of any of
the transactions contemplated by this Agreement or the Basic Documents, (y) that
might materially and adversely affect the performance by the Transferor or the
Issuer of its respective obligations under, or the validity or enforceability
of, this Agreement, any Basic Document or the Notes or (z) seeking adversely to
affect the federal or state income tax attributes of the Notes as described in
the Prospectus under the heading "Certain Tax Matters", and (B) all pending
legal or governmental proceedings to which the Transferor or the Issuer is a
party or to which any of their property or assets is subject that are not
described in the Registration Statement, including ordinary routine litigation
incidental to the business, are, considered in the aggregate with respect to the
Transferor and the Issuer, as the case may be, not material.
(iv) The favorable opinion of Kirkland & Ellis, special counsel
to the Transferor, dated the Closing Date and to the effect that (A) the Notes
will properly be treated as indebtedness for Federal income tax purposes and (B)
the Trust will not be classified as an association or a publicly traded
partnership taxable as a corporation for federal income tax purposes; (ii) the
favorable opinion of [Macfarlane Ausley Ferguson & McMullen], special Florida
tax counsel to the Transferor, dated the Closing Date and satisfactory in form
and substance to the Underwriter and counsel to the Underwriter, to the effect
that (A) the Trust will not be classified as an association taxable as a
corporation for Florida income tax purposes but instead will be characterized as
it is characterized for federal income tax purposes, (B) the intangibles held by
the Issuer will not be subject to Florida's annual recurring intangible tax
imposed under Chapter 199, Florida Statutes except to the extent that the
Transferor retains a 1% interest in the Trust
16
<PAGE>
and/or the receivables held by the Trust on the relevant date each year and (C)
the loan rule promulgated under the Florida Corporate Income Tax Code and
included in the Florida Administrative Code relating to interest on loans by
"financial organizations" (as such term is defined therein), would not apply to
an investment in the Notes by such a financial organization and (iii) the
statements in the Prospectus under State and Local Tax Consequences", to the
extent that they constitute matters of law, summaries of legal matters,
documents or proceedings or legal conclusions, have been reviewed by such
counsel and are correct in all material respects.
(v) Reliance letters relating to each legal opinion relating to
the transactions contemplated by this Agreement and the Basic Documents rendered
by counsel to the Transferor, the Issuer or World Omni to the Owner Trustee, the
Indenture Trustee or any Rating Agency, including a reliance letter with respect
to a legal opinion relating to (i) the transfer of the Receivables and related
property from World Omni to the Transferor, from the Transferor to the Issuer
and the pledge of such property by the Issuer to the Indenture Trustee and (ii)
the perfection of the Indenture Trustee's security interest in the Collateral.
(vi) The favorable opinion of counsel to the Indenture Trustee,
dated the Closing Date and satisfactory in form and substance to the
Representative and counsel to the Underwriters, to the effect that:
(1) The Indenture Trustee has been duly incorporated and is
validly existing as a banking corporation, in good standing under the laws of
the State of Illinois with full power and authority (corporate and other) to own
its properties and conduct its business, as presently conducted by it, and to
enter into and perform its obligations as Indenture Trustee under each Basic
Document to which the Indenture Trustee is a party.
(2) Each Basic Document to which the Indenture Trustee is a
party has been duly authorized, executed and delivered by the Indenture Trustee
and, assuming the due authorization, execution and delivery thereof by the other
parties thereto, will constitute a legal, valid and binding obligation of the
Indenture Trustee enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
reorganization or other similar laws affecting enforcement of creditors' rights
generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
(3) The Notes have been duly authenticated and delivered by
the Indenture Trustee.
(4) Neither the execution nor delivery by the Indenture
Trustee of each Basic Document to which it is a party nor the consummation of
any of the transactions by the Indenture Trustee contemplated thereby require
the consent or approval of, the giving of notice to, the registration with or
the taking of any other action
17
<PAGE>
with respect to, any governmental authority or agency under any existing federal
or state law governing the banking or trust powers of the Indenture Trustee.
(5) The execution and delivery of each Basic Document to
which the Indenture Trustee is a party and the performance by the Indenture
Trustee of its terms do not conflict with or result in a violation of (A) any
federal or state law or regulation governing the banking or trust powers of the
Indenture Trustee, (B) the Articles of Association or By-Laws of the Indenture
Trustee or (C) to the best knowledge of such counsel, any indenture, lease or
material agreement to which the Indenture Trustee is a party or to which its
assets are subject.
(vii) The favorable opinion of [__________], special counsel to
the Owner Trustee, dated the Closing Date and satisfactory in form and substance
to the Representative and counsel to the Underwriters, to the effect that:
(1) the Owner Trustee has been incorporated and is validly
existing as a Delaware banking corporation, in good standing under the laws of
the State of Delaware and is authorized thereunder and pursuant thereto to
transact the business of banking, to exercise fiduciary power and to enter into
and perform its obligations as Owner Trustee under each Basic Document to which
the Owner Trustee is a party.
(2) Each Basic Document to which the Owner Trustee is a
party has been duly authorized, executed and delivered by the Owner Trustee and,
assuming the due authorization, execution and delivery thereof by the other
parties thereto, will constitute a legal, valid and binding obligation of the
Owner Trustee enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
reorganization or other similar laws affecting enforcement of creditors' rights
generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
(3) Each Note has been duly executed and delivered by the
Owner Trustee. The Transferor Certificate has been duly executed, authenticated
and delivered by the Owner Trustee.
(4) Neither the execution nor delivery by the Owner Trustee
of each Basic Document to which it is a party nor the consummation of any of the
transactions by the Owner Trustee contemplated thereby require the consent or
approval of, the giving of notice to, the registration with or the taking of any
other action with respect to, any Person or entity, including any governmental
authority or agency under any existing federal or state law.
(5) The execution and delivery of each Basic Document to
which the Owner Trustee is a party and the performance by the Owner Trustee of
its terms do not conflict with or result in a violation of (A) any federal or
state law or regulation governing the banking or trust powers of the Owner
Trustee, (B) the Articles of Association or By-Laws of the Owner Trustee or (C)
to the best knowledge of such
18
<PAGE>
counsel, any indenture, lease or material agreement to which the Owner Trustee
is a party or to which its assets are subject.
(viii) The favorable opinion of Orrick, Herrington & Sutcliffe
LLP, counsel for the Underwriters, dated the Closing Date, with respect to the
validity of the Notes and such other related matters as the Representative shall
request, which opinions shall be satisfactory in form and substance to the
Representative and counsel for the Underwriters.
(e) The Class A Notes shall be rated in the highest rating category
for long-term debt obligations by each of [Moody's and Standard & Poor's] and
the Class B Notes shall be rated at least [A] or its equivalent for long-term
debt obligations by [Moody's and Standard & Poor's].
(f) On or prior to the Closing Date, all of the conditions precedent
to the execution of the [Swap Agreement] have been satisfied and each of the
opinions delivered in connection with the [Swap Agreement] have been addressed
to the Underwriters and delivered to the Representative.
(g) On or prior to the Closing Date, counsel for the Underwriters
shall have been furnished with such documents and opinions as they may
reasonably require for the purpose of enabling them to pass upon the issuance of
the Notes and the Transferor Certificate and sale of the Notes as herein
contemplated and related proceedings, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the parties to the
Basic Documents in connection with the issuance of the Notes and the Transferor
Certificate and sale of the Notes as herein contemplated shall be satisfactory
in form and substance to the Representative and counsel for the Underwriters.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Representative by notice to the Transferor, the Issuer and World Omni at
any time at or prior to the Closing Date, and such termination shall be without
liability of any party to any other party except as provided in Section 5(h)
hereof.
7. Indemnification and Contribution.
--------------------------------
(a) Each of the Issuer, World Omni and the Transferor agrees, jointly
and severally, to indemnify and hold harmless each Underwriter and each person,
if any, who controls any Underwriter within the meaning of Section 15 of the Act
as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement (or
any amendment thereto), including the information deemed to be part of the
Registration Statement pursuant to Rule 430A(b) of the Rules and Regulations, if
applicable, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged
19
<PAGE>
untrue statement of a material fact contained in any preliminary prospectus or
the Prospectus (or any amendment or supplement thereto) or the omission or
alleged omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the written consent
of the Transferor and World Omni; and
(iii) against any and all expense whatsoever, as incurred
(including, subject to Section 7(c) hereof, the fees and disbursements of
counsel chosen by the Representative), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense is not
paid under clause (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Issuer or the
Transferor by any Underwriter through the Representative expressly for use in
the Registration Statement (or any amendment thereto) or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto).
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Transferor, the Issuer and World Omni, each of their respective directors,
each of their respective officers who signed the Registration Statement and each
person, if any, who controls each of the Transferor, the Issuer and World Omni,
respectively, within the meaning of Section 15 of the Act, against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto), in reliance upon and
in conformity with written information furnished to the Transferor or the Issuer
by such Underwriter directly or through the Representative expressly for use in
the Registration Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it with respect to which indemnity may be sought hereunder, but failure
to so notify an indemnifying party shall not relieve it from any liability which
it may have other than on account of this indemnity agreement. An indemnifying
party or parties may participate at their own
20
<PAGE>
expense in the defense of such action, but if the indemnifying party or parties
do not elect to participate in the defense of such action, such indemnifying
party or parties will reimburse such indemnified party for the reasonable fees
and expenses of any counsel retained by it. In the event that the parties to any
such action (including impleaded parties) include both the indemnifying party
and the indemnified party and either (i) the indemnifying party or parties and
indemnified party or parties mutually agree or (ii) representation of both the
indemnifying party or parties and the indemnified party or parties by the same
counsel is inappropriate under applicable standards of professional conduct due
to actual or potential differing interests between them, then the indemnifying
party or parties shall not have the right to assume the defense of such action
on behalf of such indemnified party or parties and will reimburse such
indemnified party or parties for the reasonable fees and expenses of any counsel
retained by them, it being understood that the indemnifying party or parties
shall not, in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys for all such indemnified parties.
8. Contribution. If the indemnification provided for in Section 7 hereof
is unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) thereof, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the loss,
liability, claim, damage or expense referred to in subsection (a) or (b) of
Section 7 (i) in such proportion as is appropriate to reflect the relative
benefits received by the Transferor, the Issuer and World Omni on the one hand
and the Underwriters on the other from the offering of the Notes or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Transferor,
the Issuer and World Omni on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations. The relative benefits received by the Transferor, the Issuer and
World Omni on the one hand and the Underwriters on the other shall be deemed to
be in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Issuer bear to the total underwriting
discounts and commissions received by the Underwriters. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Transferor, the Issuer,
World Omni or the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The amount paid by an indemnified party as a result of
the loss, liability, claim, damage or expense referred to in the first sentence
of this Section shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this Section.
Notwithstanding the provisions of this Section, no Underwriter shall be required
to contribute any amount in excess of the amount by which the total price at
which the Notes underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement
21
<PAGE>
or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. Notwithstanding the other provisions of this Section, each
person, if any, who controls an Underwriter within the meaning of Section 15 of
the Act shall have the same rights to contribution as such Underwriter and each
director of the Transferor, the Issuer and World Omni, each officer of the
Issuer and the Transferor who signed the Registration Statement and each person,
if any, who controls either the Transferor, the Issuer or World Omni within the
meaning of Section 15 of the Act shall have the same rights to contribution as
the Transferor, the Issuer or World Omni, as the case may be. The Underwriters'
respective obligations to contribute pursuant to this Section are several in
proportion to the principal amount of the Notes set forth opposite their
respective names in Schedule I hereto and not joint.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Transferor, the Issuer and World Omni or their respective officers and of the
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of any Underwriter, the Transferor, the
Issuer, World Omni or any of their respective representatives, officers or
directors or any controlling Person, and will survive delivery of and payment
for the Notes. If for any reason the purchase of the Notes by the Underwriters
is not consummated, the Transferor, the Issuer and World Omni shall remain
responsible for the expenses to be paid or reimbursed by them pursuant to
Section 5(h) hereof and the respective obligations of the Transferor, World
Omni, the Issuer and the Underwriters pursuant to Section 7 hereof shall remain
in effect. If the purchase of the Notes by the Underwriters is not consummated
for any reason other than solely because of the occurrence of any event
specified in clause (iii), (iv) or (v) of Section 10 hereof, the Transferor, the
Issuer and World Omni will reimburse the Underwriters for all out-of-pocket
expenses (including the reasonable fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Notes.
10. Termination of Agreement. The Representative may terminate this
Agreement, by notice to the Transferor, the Issuer and World Omni, at any time
prior to or at the Closing Date (i) if there has been, since the date of this
Agreement or since the respective dates as of which information is given in the
Registration Statement, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Transferor, World Omni or the Issuer, whether or not arising in the ordinary
course of business; (ii) if there has occurred any downgrading in the rating of
the debt securities of the Issuer, the Transferor or World Omni by any
"nationally recognized statistical rating organization" (as such term is defined
for purposes of Rule 436(g) under the Act), or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities of the Issuer, the Transferor or World Omni (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (iii) if there has
occurred any material adverse change in the financial markets in the United
States or any outbreak of hostilities or other calamity or crisis, the effect of
which is such as to make it, in the judgment of the Representative,
impracticable to market any Class of Notes or to
22
<PAGE>
enforce contracts for the sale of any Class of Notes; (iv) if trading generally
on either the American Stock Exchange or the New York Stock Exchange has been
suspended, or minimum or maximum prices for trading have been fixed or maximum
ranges for prices for securities have been required, by either of said Exchanges
or by order of the Commission or any other governmental authority; or (v) if a
banking moratorium has been declared by either federal, New York, Delaware,
Florida or Illinois authorities.
11. Default By One or More of the Underwriters. If one or more of the
Underwriters shall fail at the Closing Date to purchase the Notes which it or
they are obligated to purchase under this Agreement (the "Defaulted
Securities"), the Representative shall have the right, but not the obligation,
within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be agreed upon
and upon the terms herein set forth; if, however, the Representative shall not
have completed such arrangements within such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Securities does
not exceed 10% of the total aggregate principal amount of the Notes, the
non-defaulting Underwriters shall be obligated to purchase the full amount
thereof in such proportions that their respective underwriting obligations
hereunder bear to the underwriting obligations of all non-defaulting
Underwriters, or
(b) if the aggregate principal amount of Defaulted Securities exceeds
10% of the total aggregate principal amount of the Notes, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter.
No action pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Representative or the Issuer and the Transferor
shall have the right to postpone the Closing Time for a period not exceeding
seven days in order to effect any required changes in the Registration Statement
or Prospectus or in any other documents or arrangement.
12. Notices. All communications hereunder will be in writing and, if sent
to (i) the Underwriters, shall be directed to the Representative and will be
mailed, delivered or sent by facsimile and confirmed to it at Merrill Lynch &
Co., North Tower, World Financial Center, New York, New York 10281-1201,
Attention: Geoffrey R. Witt, Managing Director (facsimile number (212)
449-9015); (ii) the Transferor, will be mailed, delivered or sent by facsimile
and confirmed to it at WODFI LLC, 120 N.W. 12th Avenue, Deerfield Beach, Florida
33442, Attention: A. Tucker Allen, Vice President and Corporate Treasurer
(facsimile number (954) 429-2685); (iii) the Issuer, will be mailed, delivered
or sent by facsimile and confirmed to it at c/o WODFI LLC, 120 N.W. 12th Avenue,
Deerfield Beach, Florida 33442, Attention: A. Tucker Allen, Vice President and
Corporate Treasurer (facsimile number (954) 429-2685); or (iv) World Omni, will
be mailed, delivered or sent by facsimile and confirmed to it at World Omni
Financial Corp.,
23
<PAGE>
120 N.W. 12th Avenue, Deerfield Beach, Florida 33442, Attention: A. Tucker
Allen, Vice President and Corporate Treasurer (facsimile number (954) 429-2685).
13. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling Persons referred to in Sections 7 and 8 hereof, and no
other Person will have any right or obligation hereunder.
14. Severability of Provisions. Any covenant, provision, agreement or term
of this Agreement that is prohibited or is held to be void 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.
15. Miscellaneous. This Agreement constitutes the entire agreement and
understanding of the parties hereto with respect to the matters and transactions
contemplated hereby and supersedes all prior agreements and understandings
whatsoever relating to such matters and transactions. Neither this Agreement nor
any term hereof may be changed, waived, discharged or terminated orally, but
only by an instrument in writing signed by the party against whom enforcement of
the change, waiver, discharge or termination is sought. The headings in this
Agreement are for the purposes of reference only and shall not limit or
otherwise affect the meaning hereof.
16. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
17. Applicable 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.
24
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us one of the counterparts duplicate
hereof, whereupon it will become a binding agreement between the Transferor, the
Issuer and World Omni and the Underwriters in accordance with its terms.
Very truly yours,
WODFI LLC
By: __________________________
Patrick C. Ossenbeck
Assistant Treasurer
WORLD OMNI MASTER OWNER TRUST
By: WODFI LLC
as originator of the Trust
By: ___________________________
Patrick C. Ossenbeck
Assistant Treasurer
WORLD OMNI FINANCIAL CORP.
By: ___________________________
Patrick C. Ossenbeck
Assistant Treasurer
CONFIRMED AND ACCEPTED,
as of the date first above written.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: ___________________________
Name:
Title:
For itself and as Representative of the other Underwriters
named in Schedule I
hereto.
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<PAGE>
SCHEDULE I
---------------------------------------- ----------------- ----------------
Principal Principal
Name of Underwriter Amount of Class Amount of
A Notes Class B Notes
---------------------------------------- ----------------- ----------------
---------------------------------------- ----------------- ----------------
Merrill Lynch, Pierce Fenner & Smith
Incorporated....................
---------------------------------------- ----------------- ----------------
---------------------------------------- ----------------- ----------------
Total..........................
---------------------------------------- ----------------- ----------------
CERTIFICATE OF FORMATION
OF
WODFI LLC
This Certificate of Formation of WODFI LLC (the "Company"), dated as of
July 7, 1999, has been duly executed and is being filed by Jon A. Brilliant, an
authorized person, to form a limited liability company under the Delaware
Limited Liability Company Act (6 Del.C. Section 18-101, et seq.)
FIRST. The name of the limited liability company formed hereby is WODFI
LLC.
SECOND. The address of the registered office of the Company in the
State of Delaware is c/o Corporation Service Company, 1013 Centre Road,
Wilmington, Delaware 19805.
THIRD. The name and address of the registered agent for service of
process on the Company in the State of Delaware are c/o corporation Service
Company, 1013 Centre Road, Wilmington, Delaware 19805.
IN WITNESS WHEREOF, the undersigned authorized person has executed this
Certificate of Formation as of the date first above written.
/s/ Jon A. Brilliant
--------------------
Jon A. Brilliant
Authorized Person
SECOND AMENDED AND RESTATED
---------------------------
LIMITED LIABILITY COMPANY AGREEMENT
-----------------------------------
OF
--
WODFI LLC
---------
A Delaware Limited Liability Company
THIS SECOND AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
(this "Agreement") is executed as of the ______ day of March, 2000, by the
undersigned, the sole member, to continue the Company (as defined below) under
the laws of the State of Delaware for the purposes and upon the terms and
conditions hereinafter set forth. The Company, the Independent Directors and the
Springing Members (each as defined below) join in the execution of this
Agreement so as to be bound by this Agreement.
World Omni Financial Corp., as the sole member (the "Member"), by
execution of this Agreement, hereby continues the Company (as defined below) to
and in accordance with the Delaware Limited Liability Company Act (6 Del.C.
ss.18-101, et seq.), as amended from time to time, and hereby desires that this
Agreement be, and hereby is, the sole governing document of the Company,
superseding all prior agreements and hereby agrees as follows:
ARTICLE I
DEFINITIONS
-----------
Section 1.1. Definitions. Whenever used in this Agreement the following
terms shall have the meanings respectively assigned to them in this Article I
unless otherwise expressly provided herein or unless the context otherwise
requires:
Act: "Act" shall mean the Delaware Limited Liability Company Act, 6
Del. C.ss.ss. 18-101 et seq., as amended from time to time.
Affiliate: "Affiliate" of another Person shall mean any Person directly
or indirectly controlling, controlled by, or under common control with, such
other person.
Agreed Value: "Agreed Value" shall mean the fair market value of
Contributed Property or services rendered as agreed to by the contributing
Member and the Company, using such reasonable method of valuation as they may
adopt.
<PAGE>
Agreement: "Agreement" shall mean this Second Amended and Restated
Limited Liability Company Agreement of the Company as the same may be amended or
restated from time to time in accordance with its terms.
Assignee: "Assignee" shall mean a Person who has acquired a share of
the Company's profits and losses and such rights to receive distributions from
the Company as are assigned to that Person, but who is not a Substitute Member.
Bankrupt Member: "Bankrupt Member" shall mean any member (a) that (i)
makes an assignment for the benefit of creditors; (ii) files a voluntary
petition in bankruptcy; (iii) is adjudged a bankrupt or insolvent, or has
entered against such Member an order for relief, in any bankruptcy or insolvency
proceedings; (iv) files a petition or answer seeking for the Member any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation; (v) files an answer or
other pleading admitting or failing to contest the material allegations of a
petition filed against the Member in any proceeding of the type described in
subclauses (i) through (iv) of this clause (a); or (vi) seeks, consents to, or
acquiesces in the appointment of a trustee, receiver or liquidator of the Member
or of all or any substantial part of the Member's properties; or (b) against
which, a proceeding seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under any statute, law
or regulation has been commenced and one hundred twenty (120) days have expired
without dismissal thereof or with respect to which, without the Member's consent
or acquiescence, a trustee, receiver or liquidator of the Member or of all or
any substantial part of the Member's properties has been appointed and ninety
(90) days have expired without the appointment having been vacated or stayed, or
ninety (90) days have expired after the date of expiration of a stay, if the
appointment has not previously been vacated. The foregoing is intended to and
shall supersede and replace the events of bankruptcy described in Sections
18-304(a) and (b) of the Act.
Bankruptcy: "Bankruptcy" means, with respect to any Person, if such
Person (i) makes an assignment for the benefit of creditors, (ii) files a
voluntary petition in bankruptcy, (iii) is adjudged a bankrupt or insolvent, or
has entered against it an order for relief, in any bankruptcy or insolvency
proceedings, (iv) files a petition or answer seeking for itself any
reorganization, arrangement, composition, readjustment, liquidation or similar
relief under any statute, law or regulation, (v) files an answer or other
pleading admitting or failing to contest the material allegations of a petition
filed against it in any proceeding of this nature, (vi) seeks, consents to or
acquiesces in the appointment of a trustee, receiver or liquidator of the Person
or of all or any substantial part of its properties, or (vii) if 120 days after
the commencement of any proceeding against the Person seeking reorganization,
arrangement, composition, readjustment, liquidation or similar relief under any
statute, law or regulation, if the proceeding has not been dismissed, or if
within 90 days after the appointment without such Person's consent or
acquiescence of a trustee, receiver or liquidator of such Person or of all or
any substantial part of its properties, the appointment is not vacated or
stayed, or within 90 days after the expiration of any such stay, the appointment
is not vacated. The foregoing definition of "Bankruptcy" is intended to replace
and shall supersede and replace the definition of "Bankruptcy" set forth in
Section 18-101(1) and 18-304 of the Act.
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Capital Contribution: "Capital Contribution" shall mean the amount in
cash contributed and the Agreed Value of other property contributed by each
Member (or its predecessors in interest) to the capital of the Company for such
Member's Membership Interest.
Cash Flow: "Cash Flow" for any period shall mean operating cash flow,
which shall be defined according to generally accepted accounting principles,
before deduction for depreciation, cost recovery or other noncash expenses of
the Company during that period.
Code: "Code" shall mean the Internal Revenue Code of 1986, as amended.
Company: "Company" shall mean WODFI LLC, the Delaware limited liability
company formed pursuant to the Act and this Agreement.
Contributed Property: "Contributed Property" shall mean each Member's
interest in property or other consideration (excluding services and cash)
contributed to the Company by such Member.
Director: "Director" has the meaning set forth in Section 7.2.
Dispose, Disposing or Disposition: "Dispose," "Disposing" or
"Disposition" shall mean a sale, assignment, transfer, exchange, mortgage,
pledge, grant of a security interest, or other disposition or encumbrance
(including, without limitation, by operation of law), or any act thereof.
Independent Director: "Independent Director" shall mean a Director of
the Company who shall at no time be (i) a director, officer, employee or former
employee of any Affiliate, (ii) a natural person related to any director,
officer, employee or former employee of any Affiliate, (iii) a holder (directly
or indirectly) of any voting securities of any Affiliate, or (iv) a natural
person related to a holder (directly or indirectly) of any voting securities of
any Affiliate. For purposes of this definition only, "Affiliate" shall mean any
entity other than the Company or any similarly organized special purpose finance
subsidiary of an Affiliate (i) which owns beneficially, directly or indirectly,
more than 10% of the aggregate Membership Interests of the Company, (ii) which
is in control of the Company, as currently defined under ss. 230.405 of the
Rules and Regulations of the Securities and Exchange Commission, 17 C.F.R. ss.
230.405, (iii) of which 10% or more of the aggregate Membership Interests is
owned beneficially, directly or indirectly, by any entity described in clause
(i) or (ii) above, or (iv) which is controlled by an entity described in clause
(i) or (ii) above, as currently defined under ss. 230.405 of the rules and
Regulations of the Securities and Exchange Commission, 17 C.F.R. ss. 230.405.
IRS: "IRS" shall mean the Internal Revenue Service.
Managing Member: "Managing Member" shall mean the Member and any
successor Managing Member appointed pursuant to this Agreement, each in its
capacity as a managing member of the Company.
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Member: "Member" shall mean World Omni Financial Corp. in its capacity
as a managing member of the Company and includes any Person admitted as an
additional Member of the Company or a Substitute Member of the Company pursuant
to the provisions of this Agreement, each in its capacity as a member of the
Company.
Membership Interest: "Membership Interest" shall mean the limited
liability company interest of a Member in the Company, including, without
limitation, rights in the capital of the Company, rights to receive
distributions (liquidating or otherwise) and allocations of profits and losses.
The Member's Membership Interest shall be expressed as a percentage which shall
equal the ratio that the value of the Capital Contributions made by such Member
bears to the Capital Contributions of all members. The initial Member's initial
Membership Interest shall be one hundred percent (100%).
Person: "Person" shall have the meaning given that term in Section
18-101(12) of the Act.
Rating Agency: "Rating Agency" shall mean any nationally recognized
statistical rating origination that has been requested to rate a Securitized
Financing.
Securities: "Securities" shall include Trust Securities, Subordinated
Interests, and Supplemental Certificate Facility.
Securitized Financing: "Securitized Financing" shall mean any
transaction in which Securities are issued and counsel to the Company or to any
maker has issued an opinion that the Company will not be substantively
consolidated with the Member in the event of bankruptcy of the Member.
Springing Member: "Springing Member means, upon such person's admission
to the Company as a member of the Company pursuant to Section 8.2, a Person
acting as Springing Member, in such Person's capacity as a member of the
Company. A Springing Member shall only have the rights and duties expressly set
forth in this Agreement.
Substitute Member: "Substitute Member" shall mean any Person to whom
the Membership Interest in the Company has been transferred and who was not the
Member immediately prior to such transfer and who has been admitted to the
Company as the Member pursuant to and in accordance with the provisions of
Article IV of this Agreement.
ARTICLE II
ORGANIZATION
------------
Section 2.1. Formation. The Member hereby executes this Agreement for
the purpose of setting forth the rights and obligations of the Member, the
Springing Member and the Independent Directors.
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Section 2.2. Name. The name of the limited liability company continued
hereby is WODFI LLC.
Section 2.3. Certificate of Formation; Foreign Qualification. Jon A.
Brilliant, as an authorized person, within the meaning of the Act, caused the
execution, delivery and filing of, the Certificate of Formation of the Company
in the office of the Secretary of State of the State of Delaware, in accordance
with the Act on July 7, 1999. Immediately following such filing, the Managing
Member is hereby designated as an authorized person, with the meaning of the
Act, to execute, deliver and file, or to cause the execution, delivery and
filing of, all certificates (and any amendments and/or restatements thereof)
required or permitted by the Act to be filed in the office of the Secretary of
State of the State of Delaware. Prior to the Company's conducting business in
any jurisdiction other than the State of Delaware, the Managing Member of the
Company shall cause the Company to comply, to the extent procedures are
available and those matters are reasonably within the control of the Managing
Member, with all requirements necessary to qualify the Company as a foreign
limited liability company in that jurisdiction. At the request of the Managing
Member of the Company, each Member shall execute, acknowledge, swear to, and
deliver all certificates and other instruments conforming with this Agreement
that are necessary or appropriate to qualify, continue and terminate the
qualification of the Company as a foreign limited liability company in all such
jurisdictions in which the Company may conduct business.
Section 2.4. No State Law Partnership; Liability to Third Parties;
Federal Taxation. The Member intends that the Company not be a partnership
(including, without limitation, a limited partnership) or joint venture, and
that no Member be a partner or joint venturer of any other Member, for any
purpose including federal and state tax purposes, and that this Agreement not be
construed to suggest otherwise. The Member, on behalf of the Company, will elect
for the Company to be a nonentity for federal tax purposes. Except as otherwise
specifically provided in the Act, no Member shall be liable for the debts,
obligations or liabilities of the Company or any other Member, including under a
judgment, decree or order of a court.
ARTICLE III
PURPOSES AND POWERS, PRINCIPAL OFFICE, REGISTERED
-------------------------------------------------
AGENT, REGISTERED OFFICE, PERIOD OF DURATION AND MEMBER LIST
------------------------------------------------------------
Section 3.1. Purposes and Powers. The Company has been formed solely
for the purpose of engaging in only the following activities:
(a) to acquire, own and hold, and to sell, transfer or pledge to
the trusts described below, or otherwise dispose of, interests in loans
made by World Omni Financial Corp., a Florida corporation ("WOFCO"), or
any subsidiary of WOFCO, under master wholesale notes issued by dealers
to WOFCO (or other extensions of credit by
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WOFCO to dealers) to finance new and used automobiles and light duty
trucks ("Receivables"), and any related contracts, collateral or
agreements ("Related Property");
(b) to act as settlor or depositor of a trust (the "Trust") formed
under a trust agreement, pooling and servicing agreement or other
agreement to hold Receivables and Related Property;
(c) to acquire trust certificates, notes or other securities issued
by the Trust ("Trust Securities"), to enter into any other agreement
providing for the authorization, issuance, sale and delivery of such
Trust Securities and to take any other actions necessary to effectuate
a public offering, private placement or other distribution of Trust
Securities;
(d) to enter into subscription or other agreements in the nature of
a revolving loan agreement with one or more financial institutions to
whom the Company may sell Securities representing fluctuating interests
in the assets of the Trust described above;
(e) to enter into and perform the Trust Agreement of the Trust,
dated as of November 22, 1999, between the Company, as transferor, and
Chase Manhattan Bank Delaware, as owner trustee, and the Receivables
Purchase Agreement, dated as of November 22, 1999, between WOFCO and
the Company;
(f) to hold, pledge, transfer or otherwise deal with and to enjoy
all of the rights and privileges of any Securities, including
Securities representing subordinated or residual interests in
Receivables ("Subordinated Interests");
(g) to loan or otherwise invest proceeds from Receivables, funds
received in respect of the Supplemental Certificate Facility,
Securities or Subordinated Interests and any other income, as
determined by the Company's Board of Directors;
(h) to issue its own securities backed by Receivables or Trust
Securities ("Direct Securities"), and to enter into any other agreement
providing for the authorization, issuance, sale and delivery of such
Direct Securities;
(i) to borrow money to facilitate any activity authorized herein
including, without limitation, obtaining loans from WOFCO to enable the
Company to acquire Receivables and Related Property ("Master Loans");
(j) for so long as any outstanding Securities are rated by any
Rating Agency, the Company shall not issue notes or otherwise borrow
money (including the Master Loans) or otherwise engage in any of the
activities listed in items (d), (e), (f), (g), (h) and (i) above,
unless (i) such Securities, notes or borrowings are rated by the Rating
Agency the same as or higher than the rating afforded such rated
Securities, or (ii) such Securities, notes or borrowings (A) are fully
subordinated (and shall provide for payment only after payment in
respect of all outstanding rated Securities) or are nonrecourse against
any assets of the Company other than the assets pledged to secure such
Securities, notes or borrowings, (B) do not constitute a claim against
the Company in the event such assets are insufficient to pay such
Securities, notes or borrowings, and (C) where either such Securities,
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notes or borrowings are secured by Subordinated Interests, are fully
subordinated (and which shall provide for payment only after payment in
respect of all outstanding rated Securities) to such Subordinated
Interests or each Rating Agency has confirmed that the issuance of such
Securities, notes or borrowings will not result in the downgrade of any
rated Securities; and
(k) to engage in any lawful act or activity and to exercise
any powers permitted to limited liability companies organized under the
Act that are incidental to and necessary or convenient for the
accomplishment of the foregoing purposes.
The Company is not otherwise authorized to engage in any activity
except the foregoing.
Section 3.2. Principal Office. The initial principal office of the
Company is located at 120 N.W. 12th Avenue, Deerfield Beach, Florida 33442. The
principal office of the Company may be relocated from time to time by
determination of the Managing Member.
Section 3.3. Registered Office;Registered Agent. The Registered Office
of the Company shall be located at: c/o Corporation Service Company, 1013 Centre
Road, Wilmington, New Castle County, Delaware 19805 and the registered agent for
service of process on the Company in the State of Delaware shall be Corporation
Service Company located at such address.
Section 3.4. Period of Duration. The term of the Company shall continue
in perpetuity, unless the Company is earlier dissolved pursuant to law or the
provisions of this Agreement.
ARTICLE IV
MEMBERSHIP AND DISPOSITIONS OF INTERESTS
----------------------------------------
Section 4.1. Members. The name and the mailing address of the initial
Member are as follows:
Name Address
---- -------
World Omni Financial Corp. 120 NW 12th Avenue
Deerfield Beach, FL 33442
Attn: Corporate Treasurer
Section 4.2. Elimination of Preemptive Rights. No Member shall be
entitled as such, as a matter of right, to subscribe for or purchase interests
in the Company of any class, now or hereafter authorized.
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Section 4.3. Resignation. Except as otherwise provided in this
Agreement, a Member does not have the right or power to resign from the Company
as a Member.
Section 4.4. Restriction on the Disposition of the Membership Interest.
---------------------------------------------------------
(a) Subject to compliance with all applicable provisions of
this Section 4.4, any Member may Dispose of all or any part of its Membership
Interest. The Person to whom such Disposition is made shall be an Assignee of
such interest but shall not be a Substitute Member unless admitted as a
Substitute Member in accordance with Section 4.4(b). For purposes of the second
sentence of this Section 4.4(c), the term Disposition does not include the
mortgage, pledge or grant of a security interest in, all or any part of the
Member's Membership Interest.
(b) The Person to whom a Disposition is made as described in
Section 4.4(a) shall have the right to become a Substitute Member only if (i)
the Member making such Disposition grants the transferee the right to be a
Substitute Member (which grant (subject to the following clause (ii)) is hereby
permitted) and (ii) such admission as a Substitute Member is consented to by all
of the Members and, until all Securitized Financings are paid and satisfied in
full, all members of the Board of Directors (as hereinafter defined), which
consent may not be unreasonably withheld.
(c) The Company shall not recognize for any purpose any
purported Disposition of all or part of the Member's Membership Interest or any
right or interest appertaining thereto unless and until the Company has received
a document (i) executed by both the Member effecting the Disposition and the
Person acquiring such Membership Interest or part thereof, (ii) including the
notice address of any Person to be admitted to the Company as a Substitute
Member and such Person's agreement to be bound by this Agreement in respect of
the Membership Interest or part thereof being obtained, (iii) setting forth the
Membership Interest of the parties to the Disposition after the Disposition, and
(iv) containing a warranty and representation that the Disposition was made in
accordance with this Agreement and all applicable laws and regulations. Each
Disposition and, if applicable, admission complying with the provisions of this
Section 4.4 is effective as of the date of the document described in this
Section 4.4(c), but only if the other requirements of this Section 4.4 have been
met.
Section 4.6. Bankrupt Member. A Member shall not cease to be a Member
or terminate the Member's Membership Interest in the Company as a result of
becoming a Bankrupt Member and, upon the occurrence of such event, the Company
shall continue without dissolution. In the event of a Bankruptcy of the Member,
the Member hereby agrees to waive any right to reject this Agreement under the
federal bankruptcy laws.
Section 4.7. Dissolution. Upon the occurrence of any event that causes
the Member or the last remaining member of the Company to cease to be a member
of the Company, to the fullest extent permitted by law, the personal
representative of such member is hereby authorized to, and shall, within 90 days
after the occurrence of the event that terminated the continued membership of
such member in the Company, agree in writing (i) to continue the Company and
(ii) to the admission of the personal representative or its nominee or designee,
as the case may
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be, as a substitute member of the Company, effective as of the occurrence of the
event that terminated the continued membership of the last remaining member of
the Company in the Company.
ARTICLE V
CAPITAL CONTRIBUTIONS
---------------------
Section 5.1. Admission and Initial Capital Contributions. The Member
has been admitted as the initial Member of the Company. The Member has
contributed $1000.00, in cash, and no other property, to the Company and may
contribute in the future any additional capital deemed necessary by the Managing
Member, in its sole discretion, for the operation of the Company. In accordance
with Section 4.4 hereof, no other Person shall be admitted as an additional
member of the Company without the approval of the Member and the unanimous
approvals of all members of the Board of Directors, including, without
limitation, the affirmative vote of the Independent Directors.
Section 5.2. Additional Capital; Adjustment of Membership Interests.
Except as specifically set forth elsewhere in this Agreement, no Member shall be
required to contribute capital to the Company in excess of such Member's initial
Capital Contribution. The Membership Interests of the Members shall be adjusted
to reflect (i) additional capital contributed to the Company by one or more
Members, (ii) the transfer of Membership Interests, or (iii) the withdrawal of a
Member. As of the time of an event specified in the immediately preceding
sentence, the Membership Interest of the Members may be adjusted by the Managing
Member, in its discretion, to reflect the relative Capital Accounts of the
Members after giving effect to any additional capital contributed to, or amounts
distributed by, the Company, as the case may be, and any appreciation or
depreciation in the fair market value of the Company's property.
Section 5.3. Return of Contributions. A Member is not entitled to
demand the return of any part of its Capital Contribution or to payment of
interest in respect of either its Capital Account or its Capital Contribution.
Except as otherwise expressly set forth in this Agreement, neither the Company
nor any Member has any obligation to return the Capital Contribution of a
Member.
ARTICLE VI
ACCOUNTING AND DISTRIBUTION
---------------------------
Section 6.1. Books; Fiscal Year; Accounting Terms.
------------------------------------
(a) The books of the Company shall be kept on the accrual
basis and in accordance with generally accepted accounting principles
consistently applied.
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(b) The fiscal year of the Company for financial and tax
reporting purposes shall end on December 31 of each year.
Section 6.2. Distributions of Cash Flow. From time to time, the
Managing Member shall determine to what extent (if any) there exists sufficient
Cash Flow, after taking into account such working capital, capital expenditures
and debt service reserves as it deems necessary, to permit a distribution of
Cash Flow to the Members. Any such distribution shall be made to the Members
proportionately in accordance with their Membership Interests and shall be
subject to Section 18-607 of the Act and other applicable law.
ARTICLE VII
MANAGEMENT, LIABILITY OF MEMBERS,
---------------------------------
RIGHTS TO OBTAIN INFORMATION
----------------------------
Section 7.1. Managing Member. Except as otherwise specifically provided
in this Agreement, the Managing Member shall have the authority to, and shall,
conduct the affairs of the Company.
Section 7.2. Board of Directors. (a) The Company shall have a Board of
Managers which shall be designated as the Company's "Board of Directors" and
each member of the Board of Directors shall be designated as a "Director." All
Company powers shall be by or under the authority of, and the business and
affairs of the Company managed under the direction of, its Board of Directors.
The Board of Directors shall also have such other authority set forth in this
Agreement. The Directors are not "managers" within the meaning of the Act. The
Board of Directors in place prior to the execution of this Agreement shall
continue as the Board of Directors of the Company. Members of the Board of
Directors may be appointed and removed from time to time by the Managing Member,
in its sole discretion except as provided in Section 7.2(b). The Board of
Directors shall hold meetings, at such times and places to be agreed upon by a
majority of the Board of Directors.
(b) As long as any Securitized Financing is outstanding, the
Member shall cause the Company at all times to have at least two Independent
Directors who will be appointed by the Member. To the fullest extent permitted
by law, including Section 18-1101(c) of the Act, the Independent Directors shall
consider only the interests of the Company, including its respective creditors,
in acting or otherwise voting on any action set forth in Section 7.3(b). No
resignation or removal of an Independent Director, and no appointment of a
successor Independent Director, shall be effective until such successor shall
have accepted his or her appointment as an Independent Director by executing a
counterpart to this Agreement. In the event of a vacancy in the position of an
Independent Director, the Member shall, as soon as practicable, appoint a
successor Independent Director to replace the Independent Director ceasing to be
an Independent Director. All right, power and authority of the Independent
Directors shall be limited to the extent necessary to exercise those rights and
perform those duties specifically set forth in this Agreement. Except as
provided in the second sentence of this
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subsection, in exercising his or her rights and performing his or her duties
under this Agreement, each Independent Director shall have a fiduciary duty of
loyalty and care similar to that of a director of a business corporation
organized under the General Corporation Law of the State of Delaware, as
amended.
Section 7.3. Action by Directors. (a) Except as set forth in Subsection
(b) of this Section, any action required by this Agreement to be taken by the
Directors shall require the agreement of not less than a majority of the
Directors.
(b) Until all Securitized Financings are paid and satisfied in
full, the Company may take the following actions only with the affirmative vote
of the Member and the unanimous affirmative vote of all members of the Board of
Directors, including, without limitation, the affirmative vote of each of the
Independent Directors, provided, however, that the Board of Directors may not
vote on, or authorize the taking of any of the following actions, unless there
are two Independent Directors then serving in such capacity:
(i) make an assignment for the benefit of
creditors;
(ii) file a voluntary petition in bankruptcy;
(iii) file a petition or answer seeking any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any statute, law or regulation;
(iv) file an answer or other pleading admitting or
failing to contest the material allegations of a petition filed against
the Company in any proceeding of the type described in subclauses (i)
through (iii) of this Subsection (b);
(v) seek, consent to, or acquiesce in the
appointment of a trustee, receiver or liquidator of the Company or of
all or any substantial part of the Company's properties;
(vi) voluntarily dissolve and wind up, or
consolidate or merge with or into another entity or sell all or
substantially all of the assets of the Company; and
(vii) engage in any business activity not set forth
in Section 3.1 of this Agreement;
(c) Until all Securitized Financings are paid and satisfied in
full, the Company may not amend, alter or repeal the definition of Independent
Director, Section 7.2, subsections (b), (c) or (d) of this Section 7.3 or
Section 11.1 without the approval of the Member and the majority vote of the
full Board of Directors, including, without limitation, the affirmative votes of
the Independent Directors and such additional approvals, if any, as may be
required under each Securitized Financing with regard to amendment of documents
or instruments with respect thereto.
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Except as may be specifically required by applicable law, no
member of the Board of Directors shall be guilty of breaching any fiduciary duty
to any Member by refusing to consent to any of the listed actions in subsections
(b) or (c) of this Section 7.3.
(d) In the event of the insolvency of the Company and with
regard to any action contemplated by subsection (b) or (c) above, no Independent
Director will owe a fiduciary duty to any Person who holds a Membership Interest
(except as may be specifically required by applicable law), but any fiduciary
duty of such Independent Director with regard to such action shall be owed
instead to the creditors of the Company. No Independent Director shall serve as
a receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company, any Affiliate of the Company, any Affiliate of the
Company, or a substantial part of its respective property.
Section 7.4. Officers. (a) The Company shall also have an officer
designated as the Company's president (the "President") who shall be appointed
from time to time by the Managing Member. The President shall be the chief
operating officer of the Company. The President of the Company is hereby
delegated the power, authority and responsibility of the day-to-day management,
administrative, financial and implementive acts of the Company's business. The
President of the Company shall have the right and power to bind the Company and
to make the final determination on questions relative to the usual and customary
daily business decisions, affairs and acts of the Company. Other primary
management functions of the Company shall be assigned by the Managing Member.
(b) The Company shall also have officers designated as vice
presidents (the "Vice Presidents") who shall be appointed from time to time by
the Managing Member. The Vice Presidents shall have such powers and duties as
may from time to time be assigned to them by the Managing Member or the
President. At the request of the President, or in the case of his absence or
disability, the Vice President designated by the President (or in the absence of
such designation, the Vice President designated by the Managing Member) shall
perform all the duties of the President and when so acting, shall have all the
powers of the President.
(c) The Managing Member may appoint such other officers as it
may deem advisable from time to time. Each officer of the Company shall hold
office at the pleasure of the Managing Member, and the Managing Member may
remove any officer at any time, with or without cause. If appointed by the
Managing Member, the officers shall have the duties assigned to them by the
Managing Member.
Section 7.5. Indemnification.
---------------
(a) General. Except as otherwise provided in this Section 7.5
and to the fullest extent permitted by applicable law, the Company shall
indemnify the Member and any Director or officer and may indemnify any employee
or agent of the Company who was or is a party or is threatened to be made a
party to a threatened, pending, or completed action, suit, or proceeding
(whether civil, criminal, administrative, or investigative and whether formal or
informal) other than an action by or in the right of the Company, where such
Person is a party
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because such Person is or was a Member, Director, officer, employee, or agent of
the Company. Except as otherwise provided in this Section 7.5 and to the fullest
extent permitted by applicable law, the Company shall indemnify its Member and
Directors against expenses, including, attorney fees, judgments, penalties,
fines and amounts paid in settlement actually and reasonably incurred by a
Director in connection with an action, suit or proceeding relating to acts or
omissions of that Director regarding the items set forth in Section 7.3(b) of
this Agreement.
(b) Permissive Indemnification. Except as otherwise provided
in this Section 7.5 and to the fullest extent permitted by applicable law, the
Company shall indemnify such Member, Director or officer and may indemnify such
employee or agent against expenses, including attorneys fees, judgments,
penalties, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with the action, suit or proceeding. To the fullest
extent permitted by law, the Company shall indemnify such Member, Director or
officer and may indemnify such employee or agent if the Person acted in good
faith and did not engage in willful misconduct or gross negligence. With respect
to a criminal action or proceeding, the Person must have had no reasonable cause
to believe such Person's misconduct was unlawful. Unless ordered by a court, any
indemnification permitted under this Section 7.5(b) shall be made by the Company
only as the Company authorizes in the specific case after (i) determining that
the indemnification is proper under the circumstances because the person to be
indemnified has met the applicable standard of conduct and (ii) evaluating the
reasonableness of the expenses and of the amounts paid in settlement. This
determination and evaluation shall be made by a majority vote of the Members who
are not parties or threatened to be made parties to the action, suit or
proceeding or, if there is only one Member, by that Member. However, no
indemnification shall be provided to any Member, Director, officer, employee, or
agent of the Company for or in connection with (i) the receipt of a financial
benefit to which the person is not entitled; (ii) voting for or assenting to a
distribution to Members in violation of this Agreement or the Act; (iii) a
knowing violation of law; or (iv) acts or omissions of such Person constituting
willful misconduct or gross negligence.
(c) Mandatory Indemnification. To the extent that a Member,
Director, officer, employee, or agent of the Company has been successful on the
merits or otherwise in defense of an action, suit, or proceeding described in
Section 7.5(a) or in defense of any claim, issue, or other matter in such
action, suit or proceeding, such person shall be indemnified against actual and
reasonable expenses, including reasonable attorney fees, incurred by such person
in connection with the action, suit, proceeding and any action, suit or
proceeding brought to enforce such mandatory indemnification.
(d) The Trust will not have any obligation to make payments
under this Section 7.5 until one year and one day after all outstanding rated
securities issued by the Trust have been paid in full.
Section 7.6. Exculpation; Duties.
-------------------
(a) No Member, Director or officer of the Company shall be
liable to the Company or any other Person who has an interest in the Company for
any loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Member, Director or
13
<PAGE>
officer in good faith on behalf of the Company and in a manner reasonably
believed to be within the scope of the authority conferred on such Member,
Director or officer by this Agreement, except that a Member, Director or officer
shall be liable for any such loss, damage or claim incurred by reason of such
Member's, Director's or officer's willful misconduct or gross negligence.
(b) To the extent that at law or in equity, the Managing
Member or a Director, officer, employee or agent of the Company (each, an
"Indemnified Person") has duties (including fiduciary duties) and liabilities
relating thereto to the Company or to any Member, any such Indemnified Person
acting under this Agreement shall not be liable to the Company or to any Member
for its good faith reliance on the provisions of this Agreement. The provisions
of this Agreement, to the extent that they restrict the duties and liabilities
of an Indemnified Person otherwise existing at law or in equity, are agreed by
the Members to replace such other duties and liabilities of such Indemnified
Person.
(c) Whenever in this Agreement the Managing Member is
permitted or required to make a decision (i) in its "sole discretion", or
"discretion" or under a grant of similar authority or latitude, the Managing
Member shall be entitled to consider only such interests and factors as it
desires, including its own interests, and shall have no duty or obligation to
give any consideration to any interest of or factors affecting the Company or
any other Member, or (ii) in its "good faith" or under another expressed
standard, the Managing Member shall act under such express standard and shall
not be subject to any other or different standards imposed by this Agreement or
any other agreement contemplated herein or by relevant provisions of law or in
equity or otherwise.
ARTICLE VIII
DISSOLUTION, LIQUIDATION AND TERMINATION OF THE COMPANY
-------------------------------------------------------
Section 8.1. Dissolution. The Company shall be dissolved and its
affairs wound up only upon (i) the written consent of all the Members and, so
long as any Securitized Financing is outstanding, all members of the Board of
Directors, including, without limitation, the Independent Directors or (ii) the
entry of a decree of judicial dissolution under Section 18-802 of the Act. The
Company shall not be dissolved as a result of there no longer being any Members
of the Company if the Company is continued in accordance with Section 4.7 of
this Agreement and Section 18-801(a)(4) of the Act. Notwithstanding anything in
this Agreement to the contrary, the Company shall not be dissolved as long as
any Securitized Financing is outstanding.
Section 8.2. Upon the occurrence of any event that causes the Member
to cease to be a member of the Company (other than upon an assignment by the
Member of all of its limited liability company interest in the Company and the
admission of the transferee pursuant to Section 4.4), World Omni Receivables,
Inc. shall, without any action of any Person and simultaneously with the Member
ceasing to be a member of the Company, automatically be admitted to the Company
as a Springing Member and shall continue the Company without
14
<PAGE>
dissolution. Each Springing Member shall be a Member of the Company, but have no
interest in the profits, losses and capital of the Company, and has no right to
receive any distributions of Company assets. Pursuant to Section 18-301 of the
Act, a Springing Member shall not be required to make any capital contributions
to the Company and shall not receive a limited liability company interest in the
Company. Except as required by any mandatory provision of the Act, each
Springing Member, in its capacity as Springing Member, shall have no right to
vote on, approve or otherwise consent to any action by, or matter relating to
the Company, including, without limitation, the merger, consolidation or
conversion of the Company. A Springing Member, in its capacity as Springing
Member, may not bind the Company. No Springing Member may resign from the
Company or transfer its rights as Springing Member unless a successor Springing
Member has been admitted to the Company as Springing Member by executing a
counterpart to this Agreement; provided, however, the Springing Member shall
automatically cease to be members of the Company upon the admission to the
Company of a substitute Member. In order to implement the admission to the
Company of the Springing Member, the Springing Member shall execute a
counterpart to this Agreement. Prior to its admission to the Company as
Springing Member, the Springing Member shall not be a member of the Company. In
the event that the Springing Member dissolves or otherwise ceases to be able to
act as Springing Member, the Member shall appoint a substitute Springing Member
and such substitute Springing Member shall execute a counterpart to this
Agreement.
Section 8.3. Liquidation and Termination. On dissolution of the
Company, the Managing Member shall appoint one or more Persons, which appointee
or appointees may include itself, to act as a liquidator. The liquidator shall
proceed diligently to wind up the affairs of the Company and make final
distributions as provided herein and in the Act. The costs of liquidation shall
be borne as a Company expense; provided, however, that the Trust will not have
any obligation to make payments under this Section 8.2 until one year and one
day after all outstanding rated Securities issued by the Trust have been paid in
full. Until final distribution, the liquidator shall continue to operate the
Company properties with all of the power and authority of the Managing Member. A
reasonable time shall be allowed for the orderly liquidation of the assets of
the Company and the discharge of liabilities to creditors so as to enable the
liquidator to minimize any losses resulting from liquidation. The liquidator, as
promptly as possible after dissolution and again after final liquidation, shall
cause a proper accounting to be made by a nationally recognized firm of
certified public accountants of the Company's assets, liabilities, and
operations through the last day of the calendar month in which the dissolution
occurs or the final liquidation is completed, as applicable, and shall apply the
proceeds of liquidation as set forth in the remaining sections of this Article
VIII.
Section 8.4. Payment of Debts. The assets shall first be applied to
the satisfaction of the liabilities of the Company (including any loans or
advances that may have been made by Members to the Company and the expenses of
liquidation); provided, however, that the Trust will not have any obligation to
make payments under this Section 8.3 until one year and one day after all
outstanding rated Securities issued by the Trust have been paid in full.
Section 8.5. Remaining Distribution. The remaining assets shall then be
distributed to the Member in accordance with the Member's positive capital
account balances.
15
<PAGE>
Section 8.6. Reserve. Notwithstanding anything to the contrary in
Section 8.4, the liquidator may retain such amount as it deems necessary as a
reserve for any contingent, conditional or unmatured liabilities or obligations
of the Company, which reserve, after the passage of a reasonable period of time
as determined by the liquidator, shall be distributed in accordance with this
Article VIII.
Section 8.7. Final Accounting. Each of the Members shall be furnished
with a statement prepared by the Company's certified public accountants, which
shall set forth the assets and liabilities of the Company as of the date of the
complete liquidation. Upon compliance by the liquidator with the foregoing
distribution plan, the liquidator shall execute and cause to be filed a
Certificate of Cancellation and any and all other documents necessary with
respect to termination and cancellation of the Company under the Act. The
existence of the Company as a separate legal entity shall continue until the
cancellation of its Certificate of Formation.
ARTICLE IX
AMENDMENTS
----------
Section 9.1. Authority to Amend. Subject to Section 7.3, this
Agreement may only be amended with approval of the Managing Member and the
majority vote of the members of the full Board of Directors and such additional
approvals, if any, as may be required under each Securitized Financing with
regard to amendment of documents or instruments with respect thereto. The
Managing Member shall provide prior written notice of any proposed amendment to
each nationally recognized statistical rating agency then rating any class of
security issued in any Securitized Financing.
ARTICLE X
POWER OF ATTORNEY
-----------------
Section 10.1. Power. Each member irrevocably constitutes and appoints
the Managing Member as his true and lawful attorney in his name, place and stead
to make, execute, swear to, acknowledge, deliver and file:
(a) Any certificates or other instruments which may be
required to be filed by the Company under the laws of the State of Delaware or
of any other state or jurisdiction in which the Managing Member shall deem it
advisable;
(b) Any documents, certificates or other instruments,
including but not limited to, any and all amendments and modifications of this
Agreement or of the instruments described in Subsection 10.1(a) which may be
required or deemed desirable by the Managing Member to effectuate the provisions
of any part of this Agreement, and, by way of extension and not in limitation,
to do all such other things as shall be necessary to continue and to carry on
the business of the Company; and
16
<PAGE>
(c) All documents, certificates or other instruments which may
be required to effectuate the dissolution and termination of the Company, to the
extent such dissolution and termination is authorized hereby. The power of
attorney granted hereby shall not constitute a waiver of, or be used to avoid,
the rights of the Members to approve certain amendments to this Agreement
pursuant to Subsection 9.1 or be used in any other manner inconsistent with the
status of the Company as a limited liability company or inconsistent with the
provisions of this Agreement.
Section 10.2. Survival of Power. It is expressly intended by each
Member that the foregoing power of attorney is coupled with an interest, is
irrevocable and shall survive the death, retirement or adjudication of
incompetency of such Member. The foregoing power of attorney shall survive the
delivery of an assignment by the Member of its entire interest in the Company,
except that where an assignee of such entire interest has become a Substitute
Member, then the foregoing power of attorney of the assignor Member shall
survive the delivery of such assignment for the sole purpose of enabling the
Managing Member to execute, acknowledge and file any and all instruments
necessary to effectuate such substitution.
ARTICLE XI
SEPARATE LEGAL ENTITY
---------------------
Section 11.1. Separate Legal Entity. The Company shall not commingle
any of its funds or other assets with the funds or assets of any other entity or
person. The Company shall maintain its financial and accounting books and
records separate from those of any other entity or person. The Company shall pay
from its assets all obligations and indebtedness of any kind incurred by the
Company, and shall not pay from its assets any obligations or indebtedness of
any other entity or person, other than expenses, obligations or indebtedness of
any New Trust or any trustee of any of the foregoing with respect thereto.
ARTICLE XII
MISCELLANEOUS
-------------
Section 12.1. Method of Giving Consent. Any consent of the Member
required by this Agreement may be given by a written consent, given by the
consenting Member and received by the Person soliciting such consent. Any
consent of a member of the Board of Director's required by this Agreement may be
given by a written consent given by the consenting member of the Board of
Directors and received by the Person soliciting such consent.
Section 12.2. Governing Law. This Agreement and the rights and duties
of the Members shall be governed by and construed in accordance with the laws of
the State of Delaware, without regard to principles of conflict of laws.
17
<PAGE>
Section 12.3. Agreement for Further Execution. At any time or times
upon the request of the Managing Member, each Member agrees to sign and swear to
any certificate, any amendment to or cancellation of such certificate,
acknowledge similar certificates or affidavits or certificates of fictitious
firm name or the like (and any amendments or cancellations thereof) required by
the laws of the State of Delaware, or any other jurisdiction in which the
Company does, or proposes to do, business. This Section 12.3 shall not prejudice
or affect the rights of the Members to approve amendments to this Agreement
pursuant to Section 9.1.
Section 12.4. Entire Agreement. This Agreement contains the entire
understanding between the parties and supersedes any prior understandings or
agreements between them respecting the within subject matter. There are no
representations, agreements, arrangements or understandings, oral or written,
between the parties hereto relating to the subject matter of this Agreement
which are not fully expressed.
Section 12.5. Severability. This Agreement is intended to be performed
in accordance with, and only to the extent permitted by, all applicable laws,
ordinances, rules and regulations of the jurisdictions in which the Company does
business. If any provision of this Agreement or the application thereof to any
Person or circumstance shall, for any reason and to any extent, be invalid or
unenforceable, the remainder of this Agreement and the application of such
provision to other Persons or circumstances shall not be affected thereby, but
rather shall be enforced to the greatest extent permitted by law.
Section 12.6. Notices. Notices to Members or to the Company shall be
deemed to have been given when personally delivered or mailed, by prepaid
registered or certified mail, addressed as set forth in this Agreement, unless a
notice of change of address has previously been given in writing by the
addressee to the addressor, in which case such notice shall be addressed to the
address set forth in such notice of change of address.
Section 12.7. Counterparts. This Agreement may be executed in multiple
counterparts, each one of which shall constitute an original executed copy of
this Agreement.
Section 12.8. Pronouns. All pronouns and any variations thereof shall
be deemed to refer to the masculine, feminine, neuter, singular or plural, as
the identity of the person or persons may require.
Section 12.9. Titles and Captions. All titles and captions are for
convenience only, do not form a substantive part of this Agreement, and shall
not restrict or enlarge any substantive provisions of this Agreement.
18
<PAGE>
IN WITNESS WHEREOF, the parties have hereunto set their hands as of
the day and year first above written.
WORLD OMNI FINANCIAL CORP.
By: /s/ Patrick C. Ossenbeck
---------------------------------
Name: Patrick C. Ossenbeck
Title: Assistant Treasurer
WODFI LLC
By : World Omni Financial Corp.,
its sole member
By: /s/ Patrick C. Ossenbeck
---------------------------------
Name: Patrick C. Ossenbeck
Title: Assistant Treasurer
INDEPENDENT DIRECTOR
By: /s/ Jeffrey B. Shapiro
---------------------------------
Jeffrey B. Shapiro
INDEPENDENT DIRECTOR
By: /s/ Christopher C. Wheeler
---------------------------------
Christopher C. Wheeler
SPRINGING MEMBER
WORLD OMNI RECEIVABLES, INC.
By: /s/ Brick A. Toifel
---------------------------------
Brick A. Toifel
President
19
WORLD OMNI MASTER OWNER TRUST
Asset-Backed Notes
--------------------------------------------------------------
AMENDED AND RESTATED INDENTURE
Dated as of _______________, 2000
--------------------------------------------------------------
HARRIS TRUST AND SAVINGS BANK
Indenture Trustee
<PAGE>
<TABLE>
<CAPTION>
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- -------
<S> <C>
310 (a)(1) .................................................. 6.11
(a)(2) .................................................. 6.11
(a)(3) .................................................. 6.10
(a)(4) .................................................. 6.14
(b) .................................................. 6.11
(c) .................................................. N.A.
311 (a) .................................................. 6.12
(b) .................................................. 6.12
(c) .................................................. N.A.
312 (a) .................................................. 7.1, 7.2
(b) .................................................. 7.2
(c) .................................................. 7.2
313 (a) .................................................. 7.4(a), 7.4(b)
(b)(1) .................................................. 7.4(a)
(b)(2) .................................................. 7.4(a)
(c) .................................................. 7.4(a)
(d) .................................................. 7.4(a)
314 (a) .................................................. 7.3(a), 3.9
(b) .................................................. 3.6
(c)(1) .................................................. 2.1, 2.9, 4.1, 11.1(a)
(c)(2) .................................................. 2.1, 2.9, 4.1, 11.1(a)
(c)(3) .................................................. 2.9, 4.1, 11.1(a)
(d) .................................................. 2.9, 11.1(b)
(e) .................................................. 11.1(a)
(f) .................................................. 11.1(a)
315 (a) .................................................. 6.1(b)
(b) .................................................. 6.5
(c) .................................................. 6.1(a)
(d) .................................................. 6.2, 6.1(c)
(e) .................................................. 5.13
316 (a) last
sentence .................................................. 1.1
(a)(1)(A) .................................................. 5.11
(a)(1)(B) .................................................. 5.12
(a)(2) .................................................. Omitted
316 (b), (c) .................................................. 5.7
317 (a)(1) .................................................. 5.3(b)
(a)(2) .................................................. 5.3(d)
(b) .................................................. 3.3
318 (a) .................................................. 11.7
N.A. means Not Applicable.
Note: This cross reference table shall not, for any purpose, be deemed to be part of this Indenture.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
1.1 Definitions...................................................................................-2-
1.2 Incorporation by Reference of Trust Indenture Act.............................................-2-
ARTICLE II
THE NOTES
2.1 Issuance of Notes; Execution, Authentication and Delivery.....................................-3-
2.2 Form of Notes and Indenture Trustee's Certificate of Authentication...........................-5-
2.3 Temporary Notes...............................................................................-6-
2.4 Registration; Registration of Transfer and Exchange of Notes..................................-6-
2.5 Mutilated, Destroyed, Lost or Stolen Notes....................................................-7-
2.6 Persons Deemed Noteholders....................................................................-8-
2.7 Payment of Principal and Interest.............................................................-9-
2.8 Cancellation of Notes........................................................................-10-
2.9 Release of Collateral........................................................................-10-
2.10 Book-Entry Notes.............................................................................-10-
2.11 Notices to Clearing Agency...................................................................-11-
2.12 Definitive Notes.............................................................................-11-
2.13 Transferor as Noteholder.....................................................................-11-
2.14 Tax Treatment................................................................................-12-
2.15 Special Terms Applicable to Subsequent Transfers of Certain Notes............................-12-
ARTICLE III
COVENANTS
3.1 Payment of Principal and Interest............................................................-13-
3.2 Maintenance of Agency Office.................................................................-13-
3.3 Money for Payments To Be Held in Trust.......................................................-13-
3.4 Existence....................................................................................-15-
3.5 Protection of Trust Estate; Acknowledgment of Pledge.........................................-15-
3.6 Opinions as to Trust Estate..................................................................-16-
3.7 Performance of Obligations; Servicing of Receivables.........................................-16-
3.8 Negative Covenants...........................................................................-17-
3.9 Annual Statement as to Compliance............................................................-18-
3.10 Consolidation, Merger, etc., of Issuer; Disposition of Trust Assets..........................-18-
3.11 Successor or Transferee......................................................................-20-
3.12 No Other Business............................................................................-20-
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<PAGE>
3.13 No Borrowing.................................................................................-21-
3.14 Guarantees, Loans, Advances and Other Liabilities............................................-21-
3.15 Servicer's Obligations.......................................................................-21-
3.16 Capital Expenditures.........................................................................-21-
3.17 Removal of Administrator.....................................................................-21-
3.18 Restricted Payments..........................................................................-21-
3.19 Notice of Events of Default..................................................................-22-
3.20 Further Instruments and Acts.................................................................-22-
3.21 Indenture Trustee's Assignment of Interests in Certain Receivables...........................-22-
3.22 Representations and Warranties by the Issuer to the Indenture Trustee........................-22-
ARTICLE IV
SATISFACTION AND DISCHARGE
4.1 Satisfaction and Discharge of Indenture......................................................-23-
4.2 Application of Trust Money...................................................................-24-
4.3 Repayment of Monies Held by Paying Agent.....................................................-24-
4.4 Duration of Position of Indenture Trustee....................................................-24-
ARTICLE V
DEFAULT AND REMEDIES
5.1 Events of Default............................................................................-25-
5.2 Acceleration of Maturity; Rescission and Annulment...........................................-26-
5.3 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee....................-26-
5.4 Remedies; Priorities.........................................................................-29-
5.5 Optional Preservation of the Trust Estate....................................................-30-
5.6 Limitation of Suits..........................................................................-31-
5.7 Unconditional Rights of Noteholders To Receive Principal and Interest........................-31-
5.8 Restoration of Rights and Remedies...........................................................-32-
5.9 Rights and Remedies Cumulative...............................................................-32-
5.10 Delay or Omission Not a Waiver...............................................................-32-
5.11 Control by Noteholders.......................................................................-32-
5.12 Waiver of Past Defaults......................................................................-33-
5.13 Undertaking for Costs........................................................................-33-
5.14 Waiver of Stay or Extension Laws.............................................................-33-
5.15 Action on Notes..............................................................................-34-
5.16 Performance and Enforcement of Certain Obligations...........................................-34-
5.17 Early Amortization Events....................................................................-35-
5.18 Investment Event.............................................................................-36-
ARTICLE VI
THE INDENTURE TRUSTEE
6.1 Duties of Indenture Trustee..................................................................-37-
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<PAGE>
6.2 Rights of Indenture Trustee..................................................................-38-
6.3 Indenture Trustee May Own Notes..............................................................-39-
6.4 Indenture Trustee's Disclaimer...............................................................-39-
6.5 Notice of Defaults...........................................................................-39-
6.6 Reports by Indenture Trustee to Holders......................................................-40-
6.7 Compensation; Indemnity......................................................................-40-
6.8 Replacement of Indenture Trustee.............................................................-41-
6.9 Merger or Consolidation of Indenture Trustee.................................................-42-
6.10 Appointment of Co-Indenture Trustee or Separate Indenture Trustee............................-42-
6.11 Eligibility; Disqualification................................................................-43-
6.12 Preferential Collection of Claims Against Issuer.............................................-44-
6.13 Representations and Warranties of Indenture Trustee..........................................-44-
6.14 Indenture Trustee May Enforce Claims Without Possession of Notes.............................-45-
6.15 Suit for Enforcement.........................................................................-45-
6.16 Rights of Noteholders to Direct Indenture Trustee............................................-45-
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
7.1 Issuer To Furnish Indenture Trustee Names and Addresses of Noteholders.......................-46-
7.2 Preservation of Information, Communications to Noteholders...................................-46-
7.3 Reports by Issuer............................................................................-46-
7.4 Reports by Indenture Trustee.................................................................-47-
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
8.1 Collection of Money..........................................................................-48-
8.2 Trust Accounts; Allocations; Payments........................................................-48-
8.3 General Provisions Regarding Trust Accounts..................................................-49-
8.4 Release of Trust Estate......................................................................-50-
8.5 Opinion of Counsel...........................................................................-50-
ARTICLE IX
SUPPLEMENTAL INDENTURES
9.1 Supplemental Indentures Without Consent of Noteholders.......................................-51-
9.2 Supplemental Indentures With Consent of Noteholders..........................................-52-
9.3 Execution of Supplemental Indentures.........................................................-53-
9.4 Effect of Supplemental Indenture.............................................................-54-
9.5 Conformity with Trust Indenture Act..........................................................-54-
9.6 Reference in Notes to Supplemental Indentures................................................-54-
ARTICLE X
REDEMPTION OF NOTES
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<PAGE>
10.1 Redemption...................................................................................-54-
10.2 Form of Redemption Notice....................................................................-55-
10.3 Notes Payable on Redemption Date.............................................................-56-
ARTICLE XI
MISCELLANEOUS
11.1 Compliance Certificates and Opinions, etc....................................................-56-
11.2 Form of Documents Delivered to Indenture Trustee.............................................-58-
11.3 Acts of Noteholders..........................................................................-58-
11.4 Notices, etc., to Indenture Trustee, Issuer and Rating Agencies..............................-59-
11.5 Notices to Noteholders; Waiver...............................................................-60-
11.6 Alternate Payment and Notice Provisions......................................................-60-
11.7 Conflict with Trust Indenture Act............................................................-60-
11.8 Effect of Headings and Table of Contents.....................................................-61-
11.9 Successors and Assigns.......................................................................-61-
11.10 Separability..................................................................................-61-
11.11 Benefits of Indenture.........................................................................-61-
11.12 Legal Holidays................................................................................-61-
11.13 GOVERNING LAW.................................................................................-62-
11.14 Counterparts..................................................................................-62-
11.15 Recording of Indenture........................................................................-62-
11.16 No Recourse...................................................................................-62-
11.17 No Petition...................................................................................-63-
11.18 Inspection....................................................................................-63-
11.19 No Substantive Review of Compliance Documents.................................................-64-
11.20 Amendment of Basic Documents..................................................................-64-
11.21 Effect of Amendment and Restatement...........................................................-64-
EXHIBIT A Form of Transfer Certificate
EXHIBIT B Form of Undertaking Letter
EXHIBIT C Form of Indenture Trustee Certificate
Schedule 2 Collection Accounts
</TABLE>
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<PAGE>
AMENDED AND RESTATED INDENTURE, dated as of _______________,
2000, between WORLD OMNI MASTER OWNER TRUST, a Delaware business trust (the
"Issuer" or the "Trust"), and Harris Trust and Savings Bank, an Illinois
banking corporation, as indenture trustee (as indenture trustee and not in its
individual capacity the "Indenture Trustee").
RECITALS
WHEREAS, the Issuer and the Indenture Trustee are parties to
the Indenture, dated as of November 22, 1999 (the "Original Indenture").
WHEREAS, the Issuer and the Indenture Trustee desire to amend
and restate the Original Indenture.
IN WITNESS WHEREOF, each party agrees to follow for the
benefit of the other party and for the equal and ratable benefit of the Holders
of the Notes and (only to the extent expressly provided herein) the
Certificateholders:
GRANTING CLAUSE
The Issuer hereby confirms its grant of a security interest
in, transfer, assignment and conveyance to the Indenture Trustee on the Closing
Date, as trustee for the benefit of the Noteholders and (only to the extent
expressly provided herein) the Certificateholders, all of the Issuer's right,
title and interest in, to and under (a) all Receivables, all Collateral
Security with respect thereto, all monies due or to become due thereon
(including all interest thereon accruing after October 31, 1999, whether paid
or payable) and all amounts received with respect thereto and all proceeds
thereof (including "proceeds" as defined in Section 9-306 of the UCC) and
Recoveries, existing in Accounts on the Initial Cut-Off Date, generated in the
Accounts after the Initial Cut-Off Date and Receivables existing in or
generated in any Accounts added to the Trust on any Addition Date; (b) the
Trust Sale and Servicing Agreement (including the rights of WODFI LLC (the
"Transferor") under the Receivables Purchase Agreement assigned to the Issuer
pursuant to the Trust Sale and Servicing Agreement); (c) all Collections; (d)
all funds on deposit in the Trust Accounts; (e) any Enhancement issued for a
Series or class of Notes; (f) a security interest in the Vehicles; and (g) any
proceeds of the foregoing (collectively, the "Collateral").
The foregoing grant has been made and will continue to be made
in trust to secure the payment of principal of and interest on, and any other
amounts owing in respect of, the Notes, equally and ratably without prejudice,
priority or distinction (except as otherwise provided in any Series Supplement
or supplement hereto), to secure (only to the extent expressly provided herein)
distributions with respect to and interest on the Certificates, and to secure
compliance with the provisions of this Indenture, all as provided in this
Indenture. This Indenture constitutes a security agreement under the UCC.
The foregoing grant included and will continue to include all
rights, powers and options (but none of the obligations, if any) of the Issuer
under any agreement or instrument included in the Collateral,
-1-
<PAGE>
including the immediate and continuing right to claim for, collect, receive and
give receipt for principal and interest payments in respect of the Receivables
included in the Collateral and all other monies payable under the Collateral,
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 Issuer or otherwise and generally to do and receive anything that
the Issuer is or may be entitled to do or receive under or with respect to the
Collateral.
The Indenture Trustee, as trustee on behalf of the
Noteholders, and (only to the extent expressly provided herein) the
Certificateholders, acknowledges such grant and accepts the trusts under this
Indenture in accordance with the provisions of this Indenture.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions. Certain capitalized terms used in
this Indenture shall have the respective meanings assigned them in Part I of
Appendix A to the Trust Sale and Servicing Agreement dated as of November 22,
1999 as amended and restated on __________, 2000 (the "Trust Sale and Servicing
Agreement") among World Omni Financial Corp. ("World Omni"), WODFI LLC (the
"Transferor"), and Chase Manhattan Bank Delaware (the "Owner Trustee"). All
references herein to "this Indenture" are to this Indenture as it may be
amended, supplemented or modified from time to time, and all references herein
to Articles, Sections, subsections and exhibits are to Articles, Sections,
subsections and exhibits of this Indenture unless otherwise specified. All
terms defined in this Indenture shall have the defined meanings when used in
any certificate, notice, Note or other document made or delivered pursuant
hereto unless otherwise defined therein. The rules of construction set forth in
Part II of Appendix A to the Trust Sale and Servicing Agreement shall be
applicable to this Indenture.
SECTION 1.2 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the Trust Indenture Act
("TIA"), such provision is incorporated by reference in and made a part of this
Indenture. The following TIA terms used in this Indenture have the following
meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture trustee" means the Indenture Trustee.
"obligor" on the indenture securities means the Issuer and any
other obligor on the indenture securities.
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All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by a Commission
rule have the respective meanings assigned to them by such definitions.
ARTICLE II
THE NOTES
SECTION 2.1 Issuance of Notes; Execution, Authentication and
Delivery.
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(a) Notes may be issued by the Issuer upon execution of this
Indenture and from time to time thereafter, in each case, in accordance with
the terms and conditions authorized by or pursuant to a Series Supplement. The
Notes may be issued in one or more Series. The aggregate principal amount of
the Notes of all Series that may be authenticated and delivered and outstanding
under this Indenture is not limited.
(b) The Notes shall be executed on behalf of the Issuer by any
of its Authorized Officers. The signature of any such Authorized Officer on the
Notes may be manual or facsimile. Notes bearing the manual or facsimile
signature of individuals who were at any time Authorized Officers of the Issuer
shall bind the Issuer, notwithstanding that such individuals or any of them
have ceased to hold such office prior to the authentication and delivery of
such Notes or did not hold such office at the date of such Notes.
(c) Prior to or concurrently with the delivery of any Note to
the Indenture Trustee for authentication, the parties hereto shall execute and
deliver a Series Supplement which will specify the principal terms of such new
Series. The terms of such Series Supplement may modify or amend the terms of
this Indenture solely as applied to such new Series of Notes.
(i) The Series Supplement shall set forth, in
addition to all other requirements of such certificate:
(A) the name or designation of the particular
Series (which shall distinguish such Series from all other Series);
(B) the initial aggregate principal amount of the
Series (or method for calculating its initial principal amount) which
may be authenticated and delivered under this Indenture (except for
Notes authenticated and delivered upon registration and transfer of,
or in exchange for, or in lieu of, other Notes of such Series pursuant
to this Indenture);
(C) the method for allocating principal and
interest to the Noteholders;
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(D) the rate or rates (or the method for determining
its rate) at which the Notes of such Series shall bear interest, if
any, or the initial interest rate and the method for determining
subsequent interest rates;
(E) the terms on which the Notes may be exchanged for
Notes of another Series, be subject to repurchase, optional redemption
or mandatory redemption by the Transferor or be remarketed by any
remarketing agent;
(F) the date on which the Notes will begin their
Accumulation Period or Controlled Amortization Period;
(G) the percentage used to calculate monthly
Servicing Fees;
(H) the issuer and terms of any Enhancement for
that Series or the level of subordination provided by the
Certificateholder's Interest;
(I) the Final Maturity Date for that Series; and
(J) any other terms permitted by this Indenture.
(ii) The obligation of the Indenture Trustee to
authenticate the Notes of such new Series and to execute and deliver
the related Series Supplement is subject to the delivery to the
Indenture Trustee of the following:
(A) on or before the fifth Business Day immediately
preceding the Series Issuance Date, the Transferor shall have given
the Indenture Trustee, the Owner Trustee, the Servicer, each Rating
Agency, any Agent and any Enhancement Provider written notice of such
issuance and the Series Issuance Date;
(B) a Series Supplement in form satisfactory to the
Indenture Trustee, executed by each party hereto other than the
Indenture Trustee;
(C) the related Enhancement Agreement and any
related agreement, executed by each party hereto other than the
Indenture Trustee;
(D) an Opinion of Counsel to the effect that, (i) for
federal income tax purposes, the issuance of the Notes will not
adversely affect the characterization of the Notes of any outstanding
Series or class of Notes, as debt, nor will the issuance cause a
taxable event for any Noteholder, (ii) the issuance of a new Series of
Notes will be characterized as debt and (iii) the Trust will not be an
association or publicly traded partnership taxable as a corporation;
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(E) confirmation from the Rating Agencies that the
issuance will not result in a reduction or withdrawal of the rating of
any outstanding Series or class of Notes.
(d) Prior to or concurrently with each new issuance, the
Transferor shall have represented and warranted that the issuance shall not, in
the reasonable belief of the Transferor, cause an Early Amortization Event or
Investment Event to occur for any outstanding Series or class of Notes.
(e) Upon execution and delivery of a Series Supplement and
Opinion of Counsel to the Indenture Trustee, the Indenture Trustee shall
thereupon authenticate and deliver the related Notes to or upon the written
order of the Issuer, signed by any Authorized Officer.
SECTION 2.2 Form of Notes and Indenture Trustee's Certificate
of Authentication.
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(a) The Notes shall be in the forms provided from time to time
by or pursuant to a Series Supplement in accordance with the terms of this
Indenture and may have such letters, numbers or other marks of identification
or designation and such legends or endorsements printed, lithographed or
engraved thereon as the Issuer may deem appropriate and as are not inconsistent
with the provisions of this Indenture, or as may be required to comply with any
law or with any rule or regulation made pursuant thereto or with any rule or
regulation of any stock exchange on which the Notes may be listed or to conform
to usage. Any portion of the text of any Note may be set forth on the reverse
thereof, with an appropriate reference thereto on the face of the Note. The
Definitive Notes shall be typewritten, printed, lithographed or engraved or
produced by any combination of these methods (with or without steel engraved
borders), all as determined by the Authorized Officer executing such Notes, as
evidenced by such officer's execution of such Notes.
(b) The Indenture Trustee's certificate of authentication
shall be substantially in the following form:
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in
the within-mentioned Indenture.
Harris Trust and Savings Bank, not in its
individual capacity but solely as Indenture Trustee
By: ______________________________
Name:
Title:
Dated: ______________________________
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(c) Each Note shall be dated the date of its authentication.
Unless otherwise provided in the related Series Supplement, each Note shall be
issuable as a registered Note in the minimum denomination of $1,000 and in
integral multiples thereof.
SECTION 2.3 Temporary Notes.
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(a) Pending the preparation of Definitive Notes, if any, to be
issued in exchange for Book-Entry Notes the Issuer may execute, and upon
receipt of an Issuer Order the Indenture Trustee shall authenticate and
deliver, such Temporary Notes which are printed, lithographed, typewritten,
mimeographed or otherwise produced, of the tenor of the Definitive Notes in
lieu of which they are issued and with such variations as are consistent with
the terms of this Indenture as the officers executing such Notes may determine,
as evidenced by their execution of such Notes.
(b) If Temporary Notes are issued, the Issuer shall cause
Definitive Notes to be prepared without unreasonable delay. After the
preparation of Definitive Notes, the Temporary Notes shall be exchangeable for
Definitive Notes upon surrender of the Temporary Notes at the Agency Office of
the Issuer to be maintained as provided in Section 3.2, without charge to the
Noteholder. Upon surrender for cancellation of any one or more Temporary Notes,
the Issuer shall execute and the Indenture Trustee shall authenticate and
deliver in exchange therefor a like principal amount of Definitive Notes of
authorized denominations. Until so delivered in exchange, the Temporary Notes
shall in all respects be entitled to the same benefits under this Indenture as
Definitive Notes.
SECTION 2.4 Registration; Registration of Transfer and
Exchange of Notes.
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(a) The Issuer shall cause to be kept the Note Register,
comprising separate registers for each Series and class of Notes, in which,
subject to such reasonable regulations as the Issuer may prescribe, the Issuer
shall provide for the registration of the Notes and the registration of
transfers and exchanges of the Notes (the "Note Register"). The Indenture
Trustee shall initially be the Note Registrar for the purpose of registering
the Notes and transfers of the Notes as herein provided. Upon any resignation
of any Note Registrar, the Issuer shall promptly appoint a successor Note
Registrar or, if it elects not to make such an appointment, assume the duties
of the Note Registrar.
(b) If a Person other than the Indenture Trustee is appointed
by the Issuer as Note Registrar, the Issuer shall give the Indenture Trustee
prompt written notice of the appointment of such Note Registrar and of the
location, and any change in the location, of the Note Register. The Indenture
Trustee shall have the right to inspect the Note Register at all reasonable
times and to obtain copies thereof. The Indenture Trustee shall have the right
to rely upon a certificate executed on behalf of the Note Registrar by an
Executive Officer thereof as to the names and addresses of the Noteholders and
the principal amounts and number of such Notes.
(c) Upon surrender for registration of transfer of any Note at
the Corporate Trust Office of the Indenture Trustee or the Agency Office of the
Issuer (and following the delivery, in the former
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case, of such Notes to the Issuer by the Indenture Trustee), the Issuer shall
execute, the Indenture Trustee shall authenticate and the Noteholder shall
obtain from the Indenture Trustee, in the name of the designated transferee or
transferees, one or more new Notes of the same Series in any authorized
denominations of a like aggregate principal amount.
(d) At the option of the Noteholder, Notes may be exchanged
for other Notes of the same Series and class in any authorized denominations,
of a like aggregate principal amount, upon surrender of such Notes to be
exchanged at the Corporate Trust Office of the Indenture Trustee or the Agency
Office of the Issuer (and following the delivery, in the former case, of such
Notes to the Issuer by the Indenture Trustee), the Issuer shall execute, and
the Indenture Trustee shall authenticate and the Noteholder shall obtain from
the Indenture Trustee, such Notes which the Noteholder making the exchange is
entitled to receive.
(e) All Notes issued upon any registration of transfer or
exchange of other Notes shall be the valid obligations of the Issuer,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Notes surrendered upon such registration of transfer or
exchange.
(f) Every Note presented or surrendered for registration of
transfer or exchange shall be duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Indenture Trustee and the
Note Registrar, duly executed by the Holder thereof or such Holder's attorney
duly authorized in writing, with such signature guaranteed by a commercial bank
or trust company.
(g) No service charge shall be made to a Holder for any
registration of transfer or exchange of Notes, but the Issuer or Indenture
Trustee may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Notes, other than exchanges pursuant to Sections 2.3 or
9.6 not involving any transfer.
(h) The preceding provisions of this Section 2.4
notwithstanding, the Issuer shall not be required to transfer or make
exchanges, and the Note Registrar need not register transfers or exchanges, (i)
of Notes that have been selected for redemption pursuant to Article X, if
applicable; (ii) of Notes that are due for repayment within 15 days of
submission to the Corporate Trust Office or the Agency Office; or (iii) if
Section 2.15 has not been complied with in connection with such transfer.
(i) Neither the Indenture Trustee nor the Note Registrar shall
have any responsibility to monitor or restrict the transfer of beneficial
ownership in any Note an interest in which is transferable through the
facilities of the Depository.
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes.
------------------------------------------
(a) If (i) any mutilated Note is surrendered to the Indenture
Trustee, or the Indenture Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, and (ii) there is delivered to the
Indenture Trustee such security or indemnity as may be required by it to hold
the Issuer
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and the Indenture Trustee harmless, then, in the absence of notice to the
Issuer, the Note Registrar or the Indenture Trustee that such Note has been
acquired by a bona fide purchaser, the Issuer shall execute and upon the
Issuer's written request the Indenture Trustee shall authenticate and deliver,
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Note, a replacement Note of a like Series and class and aggregate principal
amount; provided, however, that if any such destroyed, lost or stolen Note, but
not a mutilated Note, shall have become or within seven days shall be due and
payable, or shall have been called for redemption, instead of issuing a
replacement Note, the Issuer may make payment to the Holder of such destroyed,
lost or stolen Note when so due or payable or upon the Redemption Date, if
applicable, without surrender thereof.
(b) If, after the delivery of a replacement Note or payment in
respect of a destroyed, lost or stolen Note pursuant to subsection (a), a bona
fide purchaser of the original Note in lieu of which such replacement Note was
issued presents for payment such original Note, the Issuer and the Indenture
Trustee shall be entitled to recover such replacement Note (or such payment)
from (i) any Person to whom it was delivered, (ii) the Person taking such
replacement Note from the Person to whom such replacement Note was delivered or
(iii) any assignee of such Person, except a bona fide purchaser, and the Issuer
and the Indenture Trustee 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.
(c) In connection with the issuance of any replacement Note
under this Section 2.5, the Issuer or the Indenture Trustee may require the
payment by the Holder of such Note of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
reasonable expenses (including all fees and expenses of the Indenture Trustee)
connected therewith.
(d) Any duplicate Note issued pursuant to this Section 2.5 in
replacement for any mutilated, destroyed, lost or stolen Note shall constitute
an original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be found at any time or be
enforced by any Person, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Notes duly issued
hereunder.
(e) The provisions of this Section 2.5 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.6 Persons Deemed Noteholders. Prior to due
presentment for registration of transfer of any Note, the Issuer, the Indenture
Trustee and any agent of the Issuer or the Indenture Trustee may treat the
Person in whose name any Note is registered (as of the day of determination) as
the Noteholder for the purpose of receiving payments of principal of and
interest on such Note and for all other purposes whatsoever, whether or not
such Note be overdue, and neither the Issuer, the Indenture Trustee nor any
agent of the Issuer or the Indenture Trustee shall be affected by notice to the
contrary.
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SECTION 2.7 Payment of Principal and Interest.
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(a) Interest on each Series of Notes shall accrue and be
payable as provided in the applicable Series Supplement. Unless otherwise
provided in the applicable Series Supplement, any installment of interest
payable on any Note shall be punctually paid or duly provided for with funds
set aside in the Collection Account, on the applicable Payment Date and shall
be paid to the Person in whose name such Note (or one or more Predecessor
Notes) is registered on the applicable Record Date, by check mailed
first-class, postage prepaid to such Person's address as it appears on the Note
Register on such Record Date; provided, however, that, with respect to
Book-Entry Notes registered on the applicable Record Date in the name of the
Note Depository for which Definitive Notes have not been issued pursuant to
Section 2.12, payment shall be made by wire transfer in immediately available
funds to the account designated by such Holder.
(b) The principal of each Series of Notes shall be payable as
provided in the applicable Series Supplement. All principal payments on each
Series of Notes shall be made pro rata to the Noteholders of such Series
entitled thereto unless otherwise provided in the related Series Supplement.
Unless otherwise provided in the applicable Series Supplement, any installment
of principal payable on any Note shall be punctually paid or duly provided for
by a deposit by or at the direction of the Issuer into the Principal Funding
Account on the applicable Payment Date and shall be paid to the Person in whose
name such Note (or one or more Predecessor Notes) is registered on the
applicable Record Date, by check mailed first-class, postage prepaid to such
Person's address as it appears on the Note Register on such Record Date;
provided, however, that, with respect to Book-Entry Notes registered on the
Record Date in the name of the Note Depository for which Definitive Notes have
not been issued pursuant to Section 2.12, payment shall be made by wire
transfer in immediately available funds to the account designated by such
Holder, except for the final installment of principal on any such Note and the
Redemption Price for any Notes, if so called, which, in each case, shall be
payable as provided herein. The funds represented by any such checks in respect
of interest or principal returned undelivered shall be held in accordance with
Section 3.3.
(c) With respect to any Payment Date on which the final
installment of principal and interest on a Series of Notes is to be paid, the
Indenture Trustee shall notify each Noteholder of such Series of Notes as of
the Record Date for such Payment Date of the fact that the final installment of
principal of and interest on such Note is to be paid on such Payment Date. With
respect to Book-Entry Notes for which Definitive Notes have not been issued,
such notice shall be sent on the Business Day prior to such Payment Date by
facsimile, and with respect to Definitive Notes, such notice shall be sent not
later than three Business Days after such Record Date in accordance with
Section 11.5(a), and, in each case, shall specify that such final installment
shall be payable only upon presentation and surrender of such Note and shall
specify the place where such Note may be presented and surrendered for payment
of such installment. The Indenture Trustee shall not be liable for any failure
to provide notice to the Noteholders as required pursuant to this Section
2.7(c) to the extent it has not received notice of such expected final
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Payment Date from the Issuer not later than two Business Days after the Record
Date. Notices in connection with redemptions of Notes shall be mailed to
Noteholders as provided in Section 10.2.
SECTION 2.8 Cancellation of Notes. All Notes surrendered for
payment, redemption, exchange or registration of transfer shall, if surrendered
to any Person other than the Indenture Trustee, be delivered to the Indenture
Trustee and shall be promptly canceled by the Indenture Trustee. The Issuer may
at any time deliver to the Indenture Trustee for cancellation any Notes
previously authenticated and delivered hereunder which the Issuer may have
acquired in any manner whatsoever, and all Notes so delivered shall be promptly
canceled by the Indenture Trustee. No Notes shall be authenticated in lieu of
or in exchange for any Notes canceled as provided in this Section 2.8, except
as expressly permitted by this Indenture. All canceled Notes may be held or
disposed of by the Indenture Trustee in accordance with its standard retention
or disposal policy as in effect at the time unless the Issuer shall direct by
an Issuer Order that they be returned to it; provided, however, that such
Issuer Order is timely and the Notes have not been previously disposed of by
the Indenture Trustee.
SECTION 2.9 Release of Collateral. If the Indenture is or is
required to be qualified under the TIA, the Indenture Trustee shall release
property from the lien of this Indenture, other than as permitted by Sections
3.21, 8.2, 8.4 and 11.1, only upon receipt of an Issuer Request accompanied by
an Officers' Certificate, an Opinion of Counsel and (to the extent required by
the TIA) Independent Certificates in accordance with TIA ss.ss. 314(c) and
314(d)(1).
SECTION 2.10 Book-Entry Notes. Unless otherwise provided in
the applicable Series Supplement, each Series of Notes, upon original issuance,
shall be issued in the form of a typewritten Note or Notes representing the
Book-Entry Notes, to be delivered to The Depository Trust Company, the initial
Clearing Agency by or on behalf of the Issuer and such Note or Notes shall be
registered on the Note Register in the name of the Note Depository (initially,
Cede & Co.). No Note Owner shall receive a Definitive Note representing such
Note Owner's interest in such Note, except as provided in Section 2.12. Unless
and until Definitive Notes with respect to such Notes have been issued to such
Note Owners pursuant to Section 2.12, with respect to such Notes:
(a) the provisions of this Section 2.10 shall be in full force
and effect;
(b) the Note Registrar and the Indenture Trustee shall be
entitled to deal with the Clearing Agency for all purposes of this Indenture
(including the payment of principal of and interest on such Notes and the
giving of instructions or directions hereunder) as the sole Holder of such
Notes and shall have no obligation to such Note Owners;
(c) to the extent that the provisions of this Section 2.10
conflict with any other provisions of this Indenture, the provisions of this
Section 2.10 shall control;
(d) the rights of the Note Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by law
and agreements between such Note Owners and the
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Clearing Agency and/or the Clearing Agency Participants, and unless and until
Definitive Notes are issued pursuant to Section 2.12, the initial Clearing
Agency shall make book-entry transfers between the Clearing Agency Participants
and receive and transmit payments of principal of and interest on such Notes to
such Clearing Agency Participants, pursuant to the Note Depository Agreement;
and
(e) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes evidencing a
specified percentage of the Outstanding Amount of the Notes, the Clearing
Agency shall be deemed to represent such percentage only to the extent that it
has (i) received written instructions to such effect from Note Owners and/or
Clearing Agency Participants owning or representing, respectively, such
required percentage of the beneficial interest in the Notes and (ii) has
delivered such instructions to the Indenture Trustee.
SECTION 2.11 Notices to Clearing Agency. With respect to any
Notes issued as Book-Entry Notes, whenever a notice or other communication to
the Noteholders is required under this Indenture, unless and until Definitive
Notes representing such Notes shall have been issued to the related Note Owners
pursuant to Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to be given to the related Noteholders to the
Clearing Agency and shall have no obligation to such Note Owners.
SECTION 2.12 Definitive Notes. If for any Notes issued as
Book-Entry Notes (i) the Administrator advises the Indenture Trustee in writing
that the Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to such Notes and the Issuer 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 the occurrence of an Event of
Default or a Servicing Default, Note Owners representing beneficial interests
aggregating at least a majority of the Outstanding Amount of such Notes advise
the Clearing Agency in writing that the continuation of a book-entry system
through the Clearing Agency is no longer in the best interests of such Note
Owners, then the Clearing Agency shall notify all Note Owners and the Indenture
Trustee in writing of the occurrence of any such event and of the availability
of Definitive Notes to such Note Owners requesting the same. Upon surrender to
the Indenture Trustee of the typewritten Note or Notes representing such
Book-Entry Notes by the Clearing Agency, accompanied by registration
instructions, the Issuer shall execute and the Indenture Trustee shall
authenticate the related Definitive Notes in accordance with the instructions
of the Clearing Agency. None of the Issuer, the Note Registrar or the Indenture
Trustee shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be fully protected in relying on, such
instructions. Upon the issuance of such Definitive Notes, the Indenture Trustee
shall recognize the Holders of such Definitive Notes as Noteholders. The
Indenture Trustee shall not be liable if the Administrator or the Indenture
Trustee is unable to locate a qualified successor Depository (or Clearing
Agency).
SECTION 2.13 Transferor as Noteholder. The Transferor in its
individual or any other capacity may become the owner or pledgee of Notes of
any Series and may otherwise deal with the Issuer or its affiliates with the
same rights it would have if it were not the Transferor.
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SECTION 2.14 Tax Treatment. The Issuer and the Indenture
Trustee, by entering into this Indenture, and the Noteholders and the Note
Owners, by acquiring any Note or interest therein, (i) express their intention
that the Notes qualify under applicable tax law as indebtedness secured by the
Collateral and (ii) unless otherwise required by appropriate taxing
authorities, agree to treat the Notes as indebtedness secured by the Collateral
for the purpose of federal income, state and local income and franchise taxes,
any applicable single business tax, and any other taxes imposed upon, measured
by or based upon gross or net income.
SECTION 2.15 Special Terms Applicable to Subsequent Transfers
of Certain Notes.
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(a) The Notes may not have been registered under the
Securities Act, or the securities laws of any other jurisdiction. Consequently,
such Notes (the "Unregistered Notes") are not transferable other than pursuant
to an exemption from the registration requirements of the Securities Act and
satisfaction of certain other provisions specified herein or in the related
Series Supplement. Unless otherwise provided in the related Series Supplement,
no sale, pledge or other transfer of any Unregistered Note (or interest
therein) after the date thereof may be made by any Person unless either such
sale, pledge or other transfer is (i) otherwise made in a transaction exempt
from the registration requirements of the Securities Act, in which case (A) the
Indenture Trustee shall require that both the prospective transferor and the
prospective transferee certify to the Indenture Trustee and the Transferor in
writing the facts surrounding such transfer, which certification shall be in
form and substance satisfactory to the Indenture Trustee and the Transferor,
and (B) the Indenture Trustee shall require a written opinion of counsel (which
shall not be at the expense of the Transferor, the Servicer or the Indenture
Trustee) satisfactory to the Transferor and the Indenture Trustee to the effect
that such transfer will not violate the Securities Act or (ii) satisfies the
restrictions on transfer set forth in the applicable Series Supplement. Neither
the Transferor nor the Indenture Trustee shall be obligated to register any
Unregistered Notes under the Securities Act, qualify any Unregistered Notes
under the securities laws of any state or provide registration rights to any
purchaser or holder thereof.
(b) Unless otherwise provided in the related Series
Supplement, the Unregistered Notes may not be acquired by or for the account of
a Benefit Plan and, by accepting and holding an Unregistered Note, the Holder
thereof shall be deemed to have represented and warranted that it is not a
Benefit Plan and, if requested to do so by the Transferor or the Indenture
Trustee, the Holder of an Unregistered Note shall execute and deliver to the
Indenture Trustee an undertaking letter in the form set forth in Exhibit B.
(c) Unless otherwise provided in the related Series
Supplement, Unregistered Notes shall be issued in the form of Definitive Notes,
shall be in fully registered form and Sections 2.10, 2.11 and 2.12 of this
Indenture shall not apply thereto.
(d) Each Unregistered Note shall bear legends to the effect
set forth in subsections (a) and (b) (if subsection (b) is applicable) above.
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ARTICLE III
COVENANTS
SECTION 3.1 Payment of Principal and Interest. The Issuer
shall duly and punctually pay the principal of and interest on the Notes in
accordance with the terms of the Notes and this Indenture. On each date on
which any payments are to be made, the Issuer shall cause amounts on deposit in
the Collection Account or any Principal Funding Account to be paid to the
Noteholders in accordance with the terms of the Notes and this Indenture, less
amounts properly withheld under the Code by any Person from a payment to any
Noteholder of interest and/or principal. Any amounts so withheld shall be
considered as having been paid by the Issuer to such Noteholder for all
purposes of this Indenture.
SECTION 3.2 Maintenance of Agency Office. As long as any of
the Notes remains outstanding, the Issuer shall maintain in the Borough of
Manhattan, the City of New York, an office (the "Agency Office"), being an
office or agency where Notes may be surrendered to the Issuer for registration
of transfer or exchange, and where notices and demands to or upon the Issuer in
respect of the Notes and this Indenture may be served. The Issuer hereby
initially appoints the Indenture Trustee to serve as its agent for the
foregoing purposes, which address is 88 Pine Street, 19th Floor, New York, New
York 10005. If the Indenture Trustee is not the agent, 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 of the Indenture
Trustee, and the Issuer hereby appoints the Indenture Trustee as its agent to
receive all such surrenders, notices and demands.
SECTION 3.3 Money for Payments To Be Held in Trust.
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(a) All payments of amounts due and payable with respect to
any Notes that are to be made from amounts withdrawn from the Collection
Account or the applicable Principal Funding Account shall be made on behalf of
the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts
so withdrawn from the Collection Account or such Principal Funding Account for
payments of Notes shall be paid over to the Issuer except as provided in this
Section 3.3.
(b) On or before each date on which payments are to be made or
the Redemption Date (if applicable), the Issuer shall deposit or cause to be
deposited in the applicable Principal Funding Account aggregate sums sufficient
to pay the amounts then becoming due with respect to the Notes, such sums to be
held in trust for the benefit of the Persons entitled thereto and (unless the
Paying Agent is the Indenture Trustee) shall promptly notify the Indenture
Trustee in writing of its action or failure to so act.
(c) The Issuer shall cause each Paying Agent other than the
Indenture Trustee to execute and deliver to the Indenture Trustee an instrument
in which such Paying Agent shall agree with the
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Indenture Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby
so agrees), subject to the provisions of this Section 3.3, that such Paying
Agent shall:
(i) hold all sums held by it for the payment of
amounts due with respect to the Notes in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such Persons
or otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(ii) give the Indenture Trustee notice of any default
by the Issuer (or any other obligor upon the Notes) of which it has
actual knowledge in the making of any payment required to be made with
respect to the Notes;
(iii) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee, forthwith
pay to the Indenture Trustee all sums so held in trust by such Paying
Agent;
(iv) immediately resign as a Paying Agent and
forthwith pay to the Indenture Trustee all sums held by it in trust
for the payment of Notes if at any time it ceases to meet the
standards required to be met by a Paying Agent in effect at the time
of determination; and
(v) comply with all requirements of the Code with
respect to the withholding from any payments made by it on any Notes
of any applicable withholding taxes imposed thereon and with respect
to any applicable reporting requirements in connection therewith.
(d) The Issuer may at any time, for the purpose of obtaining
the satisfaction and discharge of this Indenture or for any other purpose, by
Issuer Order direct any Paying Agent to pay to the Indenture Trustee all sums
held in trust by such Paying Agent, such sums to be held by the Indenture
Trustee upon the same trusts as those upon which the sums were held by such
Paying Agent; and upon such payment by any Paying Agent to the Indenture
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
(e) Subject to applicable laws with respect to escheat of
funds, any money held by the Indenture Trustee or any Paying Agent in trust for
the payment of any amount due with respect to any Note and remaining unclaimed
for one year after such amount has become due and payable shall be discharged
from such trust and be paid by the Indenture Trustee to the Issuer upon receipt
of an Issuer Request; and the Holder of such Note shall thereafter, as an
unsecured general creditor, look only to the Issuer for payment thereof (but
only to the extent of the amounts so paid to the Issuer), and all liability of
the Indenture Trustee or such Paying Agent with respect to such trust money
shall thereupon cease; provided, however, that the Indenture Trustee or such
Paying Agent, before being required to make any such payment, 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 shall
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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 Issuer. The Indenture
Trustee may also adopt and employ, at the expense of the Issuer, any other
reasonable means of notification of such repayment (including, but not limited
to, mailing notice of such repayment to Holders whose Notes have been called
but have not been surrendered for redemption or whose right to or interest in
monies due and payable but not claimed is determinable from the records of the
Indenture Trustee or of any Paying Agent, at the last address of record for
each such Holder).
SECTION 3.4 Existence. The Issuer shall keep in full effect
its existence, rights and franchises as a business trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other State or of the United States of
America, in which case the Issuer shall keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and shall
obtain and preserve its qualification to do business in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Trust Estate.
SECTION 3.5 Protection of Trust Estate; Acknowledgment of
Pledge.
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The Issuer shall from time to time execute and deliver all
such supplements and amendments hereto and all such financing statements,
amendments thereto, continuation statements, assignments, certificates,
instruments of further assurance and other instruments, and shall take such
other action necessary or advisable to:
(a) maintain or preserve the lien and security interest (and
the priority thereof) of this Indenture or carry out more effectively the
purposes hereof, including by making the necessary filings of financing
statements or amendments thereto within ninety days after the occurrence of any
of the following: (A) any change in the Issuer's name, (B) any change in the
location of the Issuer's principal place of business, (C) any merger or
consolidation or other change in the Issuer's identity or organizational
structure and by promptly notifying in writing the Indenture Trustee of any
such filings and (D) any other change or occurrence that would make any
financing statement or amendment seriously misleading within the meaning of
Section 9-402(7) of the UCC;
(b) perfect, publish notice of or protect the validity of any
grant of a security interest made or to be made by this Indenture;
(c)enforce the rights of the Indenture Trustee and the
Noteholders in any of the Collateral; or
(d) preserve and defend title to the Trust Estate and the
rights of the Indenture Trustee and the Noteholders in such Trust Estate
against the claims of all Persons and parties, and the Issuer hereby designates
the Indenture Trustee its agent and attorney-in-fact to execute any financing
statement, continuation statement or other instrument required pursuant to this
Section 3.5. In addition, the Issuer
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shall deliver to the Indenture Trustee all documents constituting "instruments"
(as defined in the UCC as in effect in the applicable jurisdiction) as shall
have been delivered to it by the Transferor pursuant to the terms of the Trust
Sale and Servicing Agreement relating to the Trust Estate with such
endorsements attached as the Indenture Trustee may reasonably require.
SECTION 3.6 Opinions as to Trust Estate.
---------------------------
(a) On the Initial Closing Date, the Issuer shall furnish to
the Indenture Trustee an Opinion of Counsel either stating that, in the opinion
of such counsel, such action has been taken with respect to the recording and
filing of this Indenture, any indentures supplemental hereto and any other
requisite documents, and with respect to the execution and filing of any
financing statements and continuation statements as are necessary to perfect
and make effective the lien and security interest of this Indenture and
reciting the details of such action, or stating that, in the opinion of such
counsel, no such action is necessary to make such lien and security interest
effective.
(b) On or before April 30 in each calendar year, beginning
April 30, 2000, the Issuer shall furnish to the Indenture Trustee an Opinion of
Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording, filing, re-recording and refiling of
this Indenture, any indentures supplemental hereto and any other requisite
documents and with respect to the execution and filing of any financing
statements and continuation statements as is necessary to maintain the lien and
security interest created by this Indenture and reciting the details of such
action or stating that in the opinion of such counsel no such action is
necessary to maintain the lien and security interest created by this Indenture.
Such Opinion of Counsel shall also describe the recording, filing, re-recording
and refiling of this Indenture, any indentures supplemental hereto and any
other requisite documents and the execution and filing of any financing
statements and continuation statements that will, in the opinion of such
counsel, be required to maintain the lien and security interest of this
Indenture until April 30 in the following calendar year.
SECTION 3.7 Performance of Obligations; Servicing of
Receivables.
----------------------------------------
(a) The Issuer shall not take any action and shall use its
reasonable efforts not to permit any action to be taken by others that would
release any Person from any of such Person's material covenants or obligations
under any instrument or agreement included in the Trust Estate or that would
result in the amendment, hypothecation, subordination, termination or discharge
of, or impair the validity or effectiveness of, any such instrument or
agreement, except as otherwise expressly provided in this Indenture, the Trust
Sale and Servicing Agreement, the Receivables Purchase Agreement, the
Administration Agreement or such other instrument or agreement.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee herein or in the Basic
Documents or an Officers' Certificate of the Issuer shall be deemed to be
action taken by the Issuer. The Indenture Trustee shall not be responsible for
the action or inaction of the
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Servicer or the Administrator. Initially, the Issuer has contracted with the
Servicer and the Administrator to assist the Issuer in performing its duties
under this Indenture.
(c) The Issuer shall punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents and
in the instruments and agreements included in the Trust Estate, including but
not limited to filing or causing to be filed all Uniform Commercial Code
financing statements and continuation statements required to be filed under the
terms of this Indenture, the Trust Sale and Servicing Agreement and the
Receivables Purchase Agreement in accordance with and within the time periods
provided for herein and therein. Except as otherwise expressly provided
therein, the Issuer shall not waive, amend, modify, supplement or terminate any
Basic Document or any provision thereof without the consent of the Indenture
Trustee.
(d) If the Issuer shall have knowledge of the occurrence of a
Servicing Default under the Trust Sale and Servicing Agreement, the Issuer
shall promptly notify the Indenture Trustee and the Rating Agencies in writing
thereof, and shall specify in such notice the response or action, if any, the
Issuer has taken or is taking with respect to such default. If a Servicing
Default shall arise from the failure of the Servicer to perform any of its
duties or obligations under the Trust Sale and Servicing Agreement or the
Receivables Purchase Agreement with respect to the Receivables in the Accounts,
the Issuer and the Indenture Trustee shall take all reasonable steps available
to them pursuant to the Trust Sale and Servicing Agreement and the Receivables
Purchase Agreement to remedy such failure.
SECTION 3.8 Negative Covenants. So long as any Notes are
Outstanding, the Issuer shall not:
(a) sell, transfer, exchange or otherwise dispose of any of
the properties or assets of the Issuer, except the Issuer may: (i) collect,
liquidate, sell or otherwise dispose of the Trust's interest in Receivables
including Defaulted Receivables, (ii) make cash payments out of the Trust
Accounts and any Principal Funding Account and (iii) take other actions, in
each case as contemplated by the Basic Documents;
(b) claim any credit on, or make any deduction from the
principal or interest payable in respect of the Notes (other than amounts
properly withheld from such payments under the Code or applicable state law) or
assert any claim against any present or former Noteholder by reason of the
payment of the taxes levied or assessed upon any part of the Trust Estate;
(c) voluntarily commence any insolvency, readjustment of debt,
marshaling of assets and liabilities or other proceeding, or apply for an order
by a court or agency or supervisory authority for the winding-up or liquidation
of its affairs or any other event specified in Section 5.1(f); or
(d) either (i) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien of this Indenture to be amended,
hypothecated, subordinated, terminated or discharged, or permit any Person to
be released from any covenants or obligations with respect to the Notes under
this
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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 or any part thereof or any interest
therein or the proceeds thereof (other than tax liens, mechanics' liens and
other liens that arise by operation of law or as otherwise contemplated by the
Basic Documents) or (iii) permit the lien of this Indenture not to constitute a
valid first priority security interest in the Trust Estate (other than with
respect to any such tax, mechanics' or other lien); provided, however, that
nothing in this Section 3.8(d) shall prohibit a Lien in favor of World Omni
subject to the provisions of Article VII of the Receivables Purchase Agreement.
SECTION 3.9 Annual Statement as to Compliance. The Issuer
shall deliver to the Indenture Trustee, on or before April 30 of each year,
beginning April 30, 2000, an Officer's Certificate signed by an Authorized
Officer of the Issuer, dated as of December 31 of such year, stating that:
(a) a review of the activities of the Issuer during such
fiscal year and of the Issuer's performance under this Indenture has been made
under such Authorized Officer's supervision; and
(b) to the best of such Authorized Officer's knowledge, based
on such review, the Issuer has fulfilled in all material respects all of its
obligations under this Indenture throughout such year, or, if there has been a
default in the fulfillment of any such obligation, specifying each such default
known to such Authorized Officer and the nature and status thereof. A copy of
such certificate may be obtained by any Noteholder by a request in writing to
the Issuer addressed to the Corporate Trust Office of the Indenture Trustee.
SECTION 3.10 Consolidation, Merger, etc., of Issuer;
Disposition of Trust Assets.
---------------------------------------
(a) The Issuer shall not consolidate or merge with or
into any other Person, unless:
(i) the Person (if other than the Issuer) formed by
or surviving such consolidation or merger shall be a Person organized
and existing under the laws of the United States of America, or any
State and shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Indenture Trustee, in form satisfactory
to the Indenture Trustee, the due and timely payment of the principal
of and interest on all Notes and the performance or observance of
every agreement and covenant of this Indenture on the part of the
Issuer to be performed or observed, all as provided herein;
(ii) immediately after giving effect to such merger
or consolidation, no Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been
satisfied with respect to such transaction and such Person for each
then outstanding Series of Notes;
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(iv) any action as is necessary to maintain the lien
and security interest created by this Indenture shall have been taken;
(v) the Issuer shall have delivered to the Indenture
Trustee an Officers' Certificate and an Opinion of Counsel addressed
to the Issuer, each stating:
(A)that such consolidation or merger and such
supplemental indenture comply with this Section 3.10; and
(B) that all conditions precedent herein provided for
in this Section 3.10 have been complied with, which shall include any
filing required by the Exchange Act; and
(vi)the Issuer has received a Tax Opinion regarding
the merger or consolidation.
(b) Except as otherwise expressly permitted by this Indenture
or the other Basic Documents, the Issuer shall not sell, convey, exchange,
transfer or otherwise dispose of any material portion of the properties and
assets included in the Trust Estate to any Person, unless:
(i) the Person that acquires such properties or
assets of the Issuer (A) shall be a United States citizen or a Person
organized and existing under the laws of the United States of America
or any State and (B) by an indenture supplemental hereto, executed and
delivered to the Indenture Trustee, in form satisfactory to the
Indenture Trustee:
(1) expressly assumes the due and
punctual payment of the principal of and interest on
all Notes and the performance or observance of every
agreement and covenant of this Indenture (and so long
as any Enhancement is in effect, such Enhancement and
all related documents) on the part of the Issuer to
be performed or observed, all as provided herein;
(2) expressly agrees that all right,
title and interest so sold, conveyed, exchanged,
transferred or otherwise disposed of shall be subject
and subordinate to the rights of Noteholders;
(3) unless otherwise provided in such
supplemental indenture, expressly agrees to
indemnify, defend and hold harmless the Issuer
against and from any loss, liability or expense
arising under or related to this Indenture and the
Notes; and
(4) expressly agrees that such Person
(or if a group of Persons, then one specified Person)
shall make all filings with the Commission (and any
other appropriate Person) required by the Exchange
Act in connection with the Notes;
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(ii) immediately after giving effect to such
transaction, no Event of Default shall have occurred and be
continuing;
(iii) the Rating Agency Condition shall have been
satisfied with respect to such transaction and such Person for each
then outstanding Series of Notes;
(iv) any action as is necessary to maintain the
lien and security interest created by this Indenture shall have been
taken; and
(v) the Issuer shall have delivered to the Indenture
Trustee an Officers' Certificate and an Opinion of Counsel addressed
to the Issuer, each stating that:
(A) such sale, conveyance, exchange, transfer or
disposition and such supplemental indenture comply with this Section
3.10;
(B) such sale, conveyance, exchange, transfer or
disposition and such supplemental indenture have no material adverse
tax consequence to the Issuer or to any Securityholder; and
(C) that all conditions precedent herein provided for
in this Section 3.10 have been complied with, which shall include any
filing required by the Exchange Act.
SECTION 3.11 Successor or Transferee.
-----------------------
(a) Upon any consolidation or merger of the Issuer in
accordance with Section 3.10(a), the Person formed by or surviving such
consolidation or merger (if other than the Issuer) shall succeed to, and be
substituted for, and may exercise every right and power of, the Issuer under
this Indenture with the same effect as if such Person had been named as the
Issuer herein.
(b) Upon a conveyance or transfer of all the assets and
properties of the Issuer pursuant to Section 3.10(b), the Issuer shall be
released from every covenant and agreement of this Indenture to be observed or
performed on the part of the Issuer with respect to the Notes immediately upon
the delivery of written notice to the Indenture Trustee from the Person
acquiring such assets and properties stating that the Issuer is to be so
released.
SECTION 3.12 No Other Business. The Issuer shall not engage in
any business or activity other than acquiring, holding and managing the
Collateral and the proceeds therefrom in the manner contemplated by the Basic
Documents, issuing the Notes and the Certificates, making payments on the Notes
and the Certificates and such other activities that are necessary, suitable or
convenient to accomplish the foregoing or are incidental thereto, as set forth
in Section 2.3 of the Trust Agreement, including entering into and making
payments under any Enhancements.
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SECTION 3.13 No Borrowing. The Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
indebtedness for money borrowed other than indebtedness for money borrowed in
respect of the Notes or in accordance with the Basic Documents.
SECTION 3.14 Guarantees, Loans, Advances and Other
Liabilities. Except as contemplated by this Indenture or the other Basic
Documents, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any
stock, obligations, assets or securities of, or any other interest in, or make
any capital contribution to, any other Person.
SECTION 3.15 Servicer's Obligations. The Issuer shall use its
best efforts to cause the Servicer to comply with its obligations under
Sections 3.4, 3.5 and 3.6 of the Trust Sale and Servicing Agreement.
SECTION 3.16 Capital Expenditures. The Issuer shall not make
any expenditure (whether by long-term or operating lease or otherwise) for
capital assets (either real, personal or intangible property) other than the
purchase of the Receivables and other property and rights from the Transferor
on the Initial Closing Date and from time to time thereafter pursuant to the
Trust Sale and Servicing Agreement.
SECTION 3.17 Removal of Administrator. So long as any Notes
are Outstanding, the Issuer shall not remove the Administrator without cause
unless the Rating Agency Condition for each Series of Notes then outstanding
shall have been satisfied in connection with such removal.
SECTION 3.18 Restricted Payments. Except for payments of
principal or interest on or redemption of the Notes, so long as any Notes are
outstanding, the Issuer shall not, directly or indirectly:
(a) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuer or otherwise, in each case with respect to any ownership or equity
interest or similar security in or of the Issuer or to the Servicer;
(b) redeem, purchase, retire or otherwise acquire for value
any such ownership or equity interest or similar security; or
(c) set aside or otherwise segregate any amounts for
any such purpose;
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provided, however, that the Issuer may make, or cause to be made, distributions
to the Servicer, the Transferor, the Indenture Trustee, the Owner Trustee and
the Securityholders as permitted by, and to the extent funds are available for
such purpose under, the Trust Sale and Servicing Agreement, the Trust Agreement
or the other Basic Documents. The Issuer shall not, directly or indirectly,
make payments to or distributions from the Collection Account or any other
Trust Account except in accordance with the Basic Documents.
SECTION 3.19 Notice of Events of Default. The Issuer agrees to
give the Indenture Trustee and the Rating Agencies prompt written notice of
each Event of Default hereunder, each Servicing Default, any Insolvency Event
with respect to the Transferor, each default on the part of the Transferor or
the Servicer of its respective obligations under the Trust Sale and Servicing
Agreement and each default on the part of World Omni of its obligations under
the Receivables Purchase Agreement, in each case promptly after the discovery
thereof by the Issuer.
SECTION 3.20 Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer shall execute and deliver such further
instruments and do such further acts as may be reasonably necessary or proper
to carry out more effectively the purpose of this Indenture.
SECTION 3.21 Indenture Trustee's Assignment of Interests in
Certain Receivables. The Indenture Trustee shall assign, without recourse,
representation or warranty, to the Servicer, World Omni or the Transferor, as
the case may be, all of the Indenture Trustee's right, title and interest in
and to any Receivable assigned by the Issuer to the Servicer, World Omni or the
Transferor, as applicable, pursuant to the Receivables Purchase Agreement or
the Trust Sale and Servicing Agreement (in each case, to the extent so assigned
and upon the receipt of any related payment, if applicable), such assignment
being an assignment outright and not for security; and the Servicer, World Omni
or the Transferor, as applicable, shall thereupon own the interest purchased in
such Receivable, free of any further obligation to the Indenture Trustee or the
Securityholders with respect thereto. If in any enforcement suit or legal
proceeding it is held that the Servicer may not enforce a Receivable on the
ground that it is not a real party in interest or a holder entitled to enforce
such Receivable, the Indenture Trustee shall, at the Servicer's expense, take
such steps as the Servicer deems necessary to enforce the Receivable, including
bringing suit in the Indenture Trustee's name, the names of the Noteholders or
the names of the Certificateholders.
SECTION 3.22 Representations and Warranties by the Issuer to
the Indenture Trustee. The Issuer hereby represents and warrants to the
Indenture Trustee as follows:
(a) Good Title. No interest in any Receivable conveyed to the
Issuer has been sold, transferred, assigned or pledged by the Issuer to any
Person other than the Indenture Trustee; immediately prior to the conveyance of
such Receivables pursuant to this Indenture, the Issuer had good and marketable
title thereto, free of any Lien; and, upon execution and delivery of this
Indenture by the Issuer, the Indenture Trustee shall have all of the right,
title and interest of the Issuer in, to and under such Receivables, free of any
Lien; and
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(b) All Filings Made. All filings (including, without
limitation, Uniform Commercial Code filings) necessary in any jurisdiction to
give the Indenture Trustee, upon the acquisition by the Issuer of any Eligible
Receivable, a first priority perfected security interest in such Eligible
Receivable have been made.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 Satisfaction and Discharge of Indenture. This
Indenture shall cease to be of further effect with respect to the Notes except
as to: (i) rights of registration of transfer and exchange; (ii) substitution
of mutilated, destroyed, lost or stolen Notes; (iii) rights of Noteholders to
receive payments of principal thereof and interest thereon; (iv) Sections 3.3,
3.4, 3.5, 3.8, 3.10, 3.12, 3.13, 3.19 and 3.21; (v) the rights, obligations and
immunities of the Indenture Trustee hereunder (including the rights of the
Indenture Trustee under Section 6.7 and the obligations of the Indenture
Trustee under Sections 4.2 and 4.4); and (vi) the rights of Noteholders as
beneficiaries hereof with respect to the property so deposited with the
Indenture Trustee payable to all or any of them, and the Indenture Trustee, on
demand of and at the expense of the Issuer, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to the
Notes, if:
(a) either:
(i) all Notes theretofore authenticated and delivered
(other than (A) Notes that have been destroyed, lost or stolen and
that have been replaced or paid as provided in Section 2.5 and (B)
Notes for whose payment money has theretofore been deposited in trust
or segregated and held in trust by the Issuer and thereafter repaid to
the Issuer or discharged from such trust, as provided in Section 3.3)
have been delivered to the Indenture Trustee for cancellation; or
(ii) all Notes not theretofore delivered to the
Indenture Trustee for cancellation:
(A) have become due and payable,
(B) will be due and payable on their respective
stated final maturity dates within one year, or
(C) are to be called for redemption within one year
under arrangements satisfactory to the Indenture Trustee for the
giving of notice of redemption by the Indenture Trustee in the name,
and at the expense, of the Issuer,
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and the Issuer, in the case of (A), (B) or (C) of subsection
4.1(a)(ii) above, has irrevocably deposited or caused to be
irrevocably deposited with the Indenture Trustee cash or direct
obligations of or obligations guaranteed by the United States of
America (which 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 unpaid principal and accrued interest on such
Notes not theretofore delivered to the Indenture Trustee for
cancellation when due;
(b) the Issuer has paid or caused to be paid or performed all
amounts and obligations which the Issuer may owe to or on behalf of the
Indenture Trustee for the benefit of the Noteholders under this Indenture or
the Notes; and
(c) the Issuer has delivered to the Indenture Trustee an
Officer's Certificate of the Issuer, an Opinion of Counsel and (if required by
the TIA or the Indenture Trustee) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable requirements of
Section 11.1(a) and each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have been
complied with.
SECTION 4.2 Application of Trust Money. All monies deposited
with the Indenture Trustee pursuant to Section 4.1 shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture and the applicable provisions of the Trust Sale and Servicing
Agreement, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Holders of the particular Notes for the
payment or redemption of which such monies have been deposited with the
Indenture Trustee, of all sums due and to become due thereon for principal and
interest; but such monies need not be segregated from other funds except to the
extent required herein or in the Trust Sale and Servicing Agreement or by
applicable law.
SECTION 4.3 Repayment of Monies Held by Paying Agent. In
connection with the satisfaction and discharge of this Indenture with respect
to each Series of Notes, all monies then held by any Paying Agent other than
the Indenture Trustee under the provisions of this Indenture with respect to
all such Notes shall, upon demand of the Issuer, be paid to the Indenture
Trustee to be held and applied according to Section 3.3 and thereupon such
Paying Agent shall be released from all further liability with respect to such
monies.
SECTION 4.4 Duration of Position of Indenture Trustee.
Notwithstanding the earlier payment in full of all principal and interest due
to all Noteholders under the terms of the Notes of each Series and the
cancellation of such Notes pursuant to Section 3.1, the Indenture Trustee shall
continue to act in the capacity as Indenture Trustee hereunder to the benefit
of the Certificateholders and the Indenture Trustee, for the benefit of the
Certificateholders, shall comply with its obligations under Sections 6.1(a),
8.2 and 8.3 of the Trust Sale and Servicing Agreement, as appropriate, until
such time as all distributions due to the Certificateholders have been paid in
full.
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ARTICLE V
DEFAULT AND REMEDIES
SECTION 5.1 Events of Default. For the purposes of this
Indenture, "Event of Default" wherever used herein, means any one of the
following events:
(a) failure to pay any interest on any Note as and when
the same becomes due and payable, and such default shall continue unremedied
for a period of 5 days; or
(b) except as set forth in Section 5.1(c), failure to pay any
installment of the principal of any Note as and when the same becomes due and
payable, and such default continues unremedied for a period of 5 days after
there shall have been given, by registered or certified mail, written notice
thereof to the Servicer by the Indenture Trustee or to the Servicer and the
Indenture Trustee by the Holders of not less than 25% of the outstanding Notes,
a written notice specifying such default and demanding that it be remedied and
stating that such notice is a "Notice of Default" hereunder; or
(c) failure to pay in full the unpaid principal balance
attributable to any Series of Notes on or prior to the Final Maturity Date for
such Series or class; or
(d) default in the observance or performance in any material
respect of any covenant or agreement of the Issuer made in this Indenture
(other than a covenant or agreement, a default in the observance or performance
of which is specifically dealt with elsewhere in this Section 5.1) which
failure materially and adversely affects the rights of the Noteholders, and
such default shall continue or not be cured for a period of 30 days after there
shall have been given, by registered, certified or overnight mail or by hand
delivery, to the Issuer and the Transferor (or the Servicer, as applicable) by
the Indenture Trustee or to the Issuer and the Transferor (or the Servicer, as
applicable) and the Indenture Trustee by the Holders of at least 25% of the
principal amount of the Notes, a written notice specifying such default and
requiring it to be remedied and stating that such notice is a "Notice of
Default" hereunder; or
(e) the filing of an 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 the Bankruptcy Code, and such
order shall have continued undischarged or unstayed for a period of 90 days; or
the filing of a decree or order by a court having jurisdiction in the premises
approving as properly filed a petition seeking reorganization, arrangement,
adjustment or composition of the Issuer under any other Insolvency Law, and
such decree or order shall have continued undischarged or unstayed for a period
of 90 days; or the filing of a decree or order of a court having jurisdiction
in the premises 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 have continued undischarged
and unstayed for a period of 90 consecutive days; or
(f) the commencement by the Issuer of a voluntary case under
the Bankruptcy Code; or the filing of a petition or answer or consent by the
Issuer seeking reorganization, arrangement,
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adjustment or composition under any other Insolvency Law, or consent to the
filing of any such petition, answer or consent; or the consent by the Issuer to
the appointment or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Issuer or for any
substantial part of the Trust Estate, or the making by the Issuer of an
assignment for the benefit of creditors, or the admission in writing of its
inability to pay its debts generally as such debts become due; or
(g)any other event designated as such in a Series Supplement.
The Issuer shall deliver to the Indenture Trustee within five Business Days
after learning of the occurrence thereof, written notice in the form of an
Officer's Certificate of any event which with the giving of notice and the
lapse of time would become an Event of Default under Section 5.1(d), its status
and what action the Issuer is taking or proposes to take with respect thereto.
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment
--------------------------------------------------
(a) If an Event of Default with respect to any Series of Notes
should occur and be continuing, then and in every such case, unless the
principal amount of the Notes shall have already become due and payable, either
the Indenture Trustee or the Holders of Notes representing not less than a
majority of the principal amount of the then outstanding Controlling Class for
that Series of Notes may declare the principal of those Notes to be immediately
due and payable, by a notice in writing to the Issuer (and to the Indenture
Trustee if given by the Noteholders) setting forth the Event or Events of
Default, and upon any such declaration the unpaid principal amount of such
Notes, together with accrued and unpaid interest thereon through the date of
acceleration, shall become immediately due and payable. Such declaration will
constitute an Early Amortization Event for that Series and may be rescinded as
set forth in Section 5.2(b).
(b) At any time after such declaration of acceleration of
maturity has been made and before a judgment or decree for payment of the money
due has been obtained by the Indenture Trustee as hereinafter provided in this
Article V, the Holders of Notes representing a majority of the principal amount
of the Notes of the Controlling Class, by written notice to the Issuer and the
Indenture Trustee, may rescind and annul such declaration and its consequences;
provided, however, that no such rescission and annulment shall extend to or
affect any subsequent Event of Default or impair any right consequent thereto;
and provided, further, that if the Indenture Trustee shall have proceeded to
enforce any right under this Indenture and such proceedings shall have been
discontinued or abandoned because of such rescission and annulment or for any
other reason, or shall have been determined adversely to the Indenture Trustee,
then and in every such case, the Indenture Trustee, the Issuer and the
Noteholders, as the case may be, shall be restored to their respective former
positions and rights hereunder, and all rights, remedies and powers of the
Indenture Trustee, the Issuer and the Noteholders, as the case may be, shall
continue as though no such proceedings had been commenced.
SECTION 5.3 Collection of Indebtedness and Suits for
Enforcement by Indenture Trustee.
----------------------------------------
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(a) The Issuer covenants that if there shall occur an Event of
Default under Sections 5.1(a), (b) or (c) that has not been waived pursuant to
Section 5.12, then the Issuer shall, upon demand of the Indenture Trustee, pay
to the Indenture Trustee, for the ratable benefit of the parties to receive
such amounts pursuant to the terms of this Indenture, the entire amount then
due and payable on the Notes for principal and interest, with interest upon the
overdue principal for each Series of Notes, at the rate borne by such Notes and
in addition thereto such further amount as shall be sufficient to cover the
costs and expenses of collection, including any fees and Variable Funding
Increased Cost Amounts, the reasonable compensation, expenses, disbursements
and advances of the Indenture Trustee and its agents and counsel, with all such
amounts applied as described in clause SECOND of Section 5.4(b).
(b) The Indenture Trustee, following the occurrence of an
Event of Default, shall have full right, power and authority to take, or defer
from taking, any and all acts with respect to the administration, maintenance
or disposition of the collateral, including the exercise of any remedies
specified in Sections 5.3 and 5.4.
(c) If the Issuer shall fail forthwith to pay such amounts
upon such demand, the Indenture Trustee, in its own name and as trustee of an
express trust, may institute a Proceeding for the collection of the sums so due
and unpaid, and may prosecute such Proceeding to judgment or final decree, and
may enforce the same against the Issuer or other obligor upon such Notes and
collect in the manner provided by law out of the property of the Issuer or
other obligor upon such Notes, wherever situated, the monies adjudged or
decreed to be payable.
(d) If an Event of Default occurs and is continuing, the
Indenture Trustee may, as more particularly provided in Section 5.4, in its
discretion, proceed to protect and enforce its rights and the rights of the
Noteholders, by such appropriate Proceedings as the Indenture Trustee shall
deem most effective to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper
remedy or legal or equitable right vested in the Indenture Trustee by this
Indenture or by applicable law.
(e) If there shall be pending, relative to the Issuer or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Trust Estate, Proceedings under any Insolvency Law, or if a
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
sequestrator or similar official shall have been appointed for or taken
possession of the Issuer or its property or such other obligor or Person, or in
case of any other comparable judicial Proceedings relative to the Issuer or
other obligor upon the Notes, or to the creditors or property of the Issuer or
such other obligor, the Indenture Trustee, irrespective of whether the
principal of any Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Indenture Trustee
shall have made any demand pursuant to the provisions of this Section 5.3,
shall be entitled and empowered, by intervention in such Proceedings or
otherwise:
(i) to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in respect of the
Notes and to file such other papers or documents as
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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 trustee, and their
respective agents, attorneys and counsel, and for reimbursement of all
expenses and liabilities incurred, and all advances made, by the
Indenture Trustee and each predecessor trustee, except as a result of
negligence or bad faith) and of the Noteholders allowed in such
Proceedings;
(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of Notes in any election
of a trustee, a standby trustee or Person performing similar functions
in any such Proceedings;
(iii) to collect and receive any monies or other
property payable or deliverable on any such claims and to distribute
all amounts received with respect to the claims of the Noteholders and
of the Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Indenture Trustee or the Holders of Notes allowed in any
judicial proceedings relative to the Issuer, its creditors and its
property; and any trustee, receiver, liquidator, custodian or other
similar official in any such Proceeding is hereby authorized by each
of such Noteholders to make payments to the Indenture Trustee, and, if
the Indenture Trustee shall consent to the making of payments directly
to such Noteholders, to pay to the Indenture Trustee such amounts as
shall be sufficient to cover reasonable compensation to the Indenture
Trustee, each predecessor trustee and their respective agents,
attorneys and counsel, and all other expenses and liabilities
incurred, and all advances made, by the Indenture Trustee and each
predecessor trustee except as a result of negligence or bad faith.
(f) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the
election of a trustee in bankruptcy or similar Person.
(g) All rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture Trustee
without the possession of any of the Notes or the production thereof in any
trial or other Proceedings relative thereto, and any such Proceedings
instituted by the Indenture Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment, subject to the payment of
the expenses, disbursements and compensation of the Indenture Trustee, each
predecessor trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Noteholders.
(h) 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
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party), the Indenture Trustee shall be held to represent all the Noteholders,
and it shall not be necessary to make any Noteholder a party to any such
Proceedings.
SECTION 5.4 Remedies; Priorities.
--------------------
(a) If an Event of Default shall have occurred and be
continuing and the Notes have been accelerated under Section 5.2(a), the
Indenture Trustee may (but shall not be required to) do one or more of the
following (subject to Section 5.5):
(i) institute Proceedings in its own name and as
trustee of an express trust for the collection of all amounts then
payable on the Notes or under this Indenture with respect thereto,
whether by declaration of acceleration or otherwise, enforce any
judgment obtained, and collect from the Issuer and any other obligor
upon such Notes monies adjudged due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect to the
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 Noteholders;
and
(iv) sell the portions of the related Trust Estate
allocated to that Series, 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 or elect to have the Issuer maintain
possession of the Trust Estate, including the Receivables included
therein, and continue to apply Collections on such Receivables as if
there had been no declaration of acceleration (although the Early
Amortization Period commenced by that declaration shall continue
unless the declaration is rescinded); provided, however, that the
Indenture Trustee may not sell or otherwise liquidate an interest in
the Trust Estate following an Event of Default and acceleration of the
Notes, unless (A) the Holders of all of the outstanding Notes of the
affected Series consent thereto, (B) the proceeds of such sale or
liquidation distributable to the Securityholders are sufficient to
discharge in full the principal of and the accrued interest on the
Notes of the affected Series as of the date of such sale or
liquidation or (C) (i) there has been an Event of Default under
Section 5.1(a), (b) or (c) or otherwise arising from a failure to make
a required payment of principal on any Notes, (ii) the Indenture
Trustee determines that the Trust Estate is reasonably unlikely to
provide sufficient funds for the payment of principal of and interest
on the Notes as and when they would have become due if the Notes had
not been declared due and payable and (iii) the Indenture Trustee
obtains the consent of Holders of a majority of the aggregate
outstanding principal amount of the Controlling Class of such Series
of Notes. In determining such sufficiency or insufficiency with
respect to clauses (B) and (C), the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment
banking or accounting firm of national reputation as to the
feasibility of such proposed action and as to the sufficiency of the
Trust Estate for such purpose.
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(b) If the Indenture Trustee collects any money or property
pursuant to this Article V, it shall pay out the money or property in the
following order:
FIRST: to the Indenture Trustee for amounts due under
Section 6.7; and
SECOND: to the Collection Account for distribution
pursuant to Section 4.3(d) of the Trust Sale and Servicing Agreement,
with such amounts being deemed to be Principal Collections and
Non-Principal Collections in the same proportion as (x) the
outstanding principal balance of the Notes bears to (y) the sum of the
accrued and unpaid interest on the Notes and other fees and expenses
payable in connection therewith under the applicable Series Supplement
(and, if any Series of Notes has Enhancements, the amount unpaid under
such Enhancements). Repayment in full of the accrued interest on and
unpaid principal balance of the Notes of that Series will be made
prior to any further distribution on the subordinated portion of the
Certificates.
(c) Notwithstanding the foregoing, if an Event of Default
shall have occurred and be continuing and the Notes of any Series shall have
been accelerated under Section 5.2(a) and the Final Maturity Date for such
Series of Note shall have occurred, on the first Payment Date thereafter, the
Indenture Trustee will sell or cause to be sold on such Payment Date such
Principal Receivables (or interests therein) in the amount and manner described
in the related Series Supplement; provided, however, that in no event shall the
amount of Principal Receivables sold exceed the Series Allocation Percentage
for that Series (for the Collection Period in which such Payment Date occurs)
of Principal Receivables on such Payment Date. The proceeds from such sale,
shall be immediately deposited into the applicable Principal Funding Account or
such other Trust Account as shall be specified in the related Series Supplement
and shall be allocated and distributed to the Noteholders of such Series in
accordance with the terms of the related Series Supplement.
SECTION 5.5 Optional Preservation of the Trust Estate. If the
Notes have been declared to be due and payable under Section 5.2 following an
Event of Default and such declaration and its consequences have not been
rescinded and annulled, the Indenture Trustee may, but need not, elect to take
and maintain possession of the Trust Estate. It is the desire of the parties
hereto and the Noteholders that there be at all times sufficient funds for the
payment of principal of and interest on the Notes, and the Indenture Trustee
shall take such desire into account when determining whether or not to take and
maintain possession of the Trust Estate. In determining whether to take and
maintain possession of the Trust Estate, the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Trust Estate for such purpose.
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SECTION 5.6 Limitation of Suits. No Holder of any Note shall
have any right to institute any Proceeding, judicial or otherwise, with respect
to this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless:
(a) such Holder's Note is in the Controlling Class;
(b) such Holder has previously given written notice to
the Indenture Trustee of a continuing Event of Default;
(c) the Holders of not less than 25% in aggregate principal
amount of the outstanding Notes of the Controlling Class have made written
request to the Indenture Trustee to institute such Proceeding in respect of
such Event of Default in its own name as Indenture Trustee hereunder;
(d) such Holder or Holders have offered to the Indenture
Trustee reasonable indemnity against the costs, expenses and liabilities to be
incurred in complying with such request;
(e) the Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity has failed to institute such
Proceedings; and
(f) no direction inconsistent with such written request has
been given to the Indenture Trustee during such 60-day period by the Holders of
a majority of the Outstanding Amount of the Notes; it being understood and
intended that no one or more Holders of Notes shall have any right in any
manner whatever by virtue of, or by availing of, any provision of this
Indenture to affect, disturb or prejudice the rights of any other Holders of
Notes or to obtain or to seek to obtain priority or preference over any other
Holders of Notes or to enforce any right under this Indenture, except in the
manner herein provided and for the equal, ratable and common benefit of all
holders of Notes. For the protection and enforcement of the provisions of this
Section 5.6, each and every Noteholder shall be entitled to such relief as can
be given either at law or in equity.
If the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Notes, each representing less than a majority of the aggregate principal amount
of the outstanding Notes, the Indenture Trustee in its sole discretion may
determine what action, if any, shall be taken, notwithstanding any other
provisions of this Indenture.
SECTION 5.7 Unconditional Rights of Noteholders To Receive
Principal and Interest. Notwithstanding any other provisions in this Indenture,
the Holder of any Note shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest on such Note
on or after the respective due dates thereof expressed in such Note or in this
Indenture (or, in the case of redemption, if applicable, on or after the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such right shall not be impaired without the consent of such Holder.
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SECTION 5.8 Restoration of Rights and Remedies. If the
Indenture Trustee or any Noteholder has instituted any Proceeding to enforce
any right or remedy under this Indenture and such Proceeding has been
discontinued or abandoned for any reason or has been determined adversely to
the Indenture Trustee or to such Noteholder, then and in every such case the
Issuer, the Indenture Trustee and the Noteholders shall, subject to any
determination in such Proceeding, be restored severally and to their respective
former positions hereunder, and thereafter all rights and remedies of the
Indenture Trustee and the Noteholders shall continue as though no such
Proceeding had been instituted.
SECTION 5.9 Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Indenture Trustee or to the
Noteholders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 5.10 Delay or Omission Not a Waiver. No delay or
omission of the Indenture Trustee or any Holder of any Note to exercise any
right or remedy accruing upon any Default or Event of Default shall impair any
such right or remedy or constitute a waiver of any such Default or Event of
Default or an acquiescence therein. Every right and remedy given by this
Article V or by law to the Indenture Trustee or to the Noteholders may be
exercised from time to time, and as often as may be deemed expedient, by the
Indenture Trustee or by the Noteholders, as the case may be.
SECTION 5.11 Control by Noteholders. The Holders of a majority
in aggregate principal amount of the outstanding Notes of the Controlling Class
shall, subject to provision being made for indemnification against costs,
expenses and liabilities in a form satisfactory to the Indenture Trustee, have
the right to direct the time, method and place of conducting any Proceeding for
any remedy available to the Indenture Trustee with respect to the Notes or
exercising any trust or power conferred on the Indenture Trustee; provided,
however, that:
(a) such direction shall not be in conflict with any rule of
law or with this Indenture;
(b) subject to the express terms of Section 5.4, any direction
to the Indenture Trustee to sell or liquidate the Trust Estate shall be by the
Holders of Notes representing not less than 100% of the outstanding Notes;
(c) if the conditions set forth in Section 5.5 have been
satisfied and the Indenture Trustee elects to retain the Trust Estate pursuant
to Section 5.5, then any direction to the Indenture Trustee by Holders of Notes
representing less than 100% of the outstanding Notes 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;
provided, however, that, subject to Section 6.1, the
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Indenture Trustee need not take any action that it determines might cause it to
incur any liability (y) with respect to which the Indenture Trustee shall have
reasonable grounds to believe that adequate indemnity against such liability is
not assured to it and (z) which might materially adversely affect the rights of
any Noteholders not consenting to such action.
SECTION 5.12 Waiver of Past Defaults.
-----------------------
(a) Prior to the declaration of the acceleration of the
maturity of the Notes as provided in Section 5.2, the Holders of not less than
a majority in principal amount of the outstanding Notes of the Controlling
Class may waive any past Default or Event of Default and its consequences
except a Default (i) in the payment of principal of or interest on any of the
Notes or (ii) in respect of a covenant or provision hereof that cannot be
modified or amended without the consent of the Holder of each such Note. In the
case of any such waiver, the Issuer, the Indenture Trustee and the Noteholders
shall be restored to their former positions and rights hereunder, respectively;
but no such waiver shall extend to any subsequent or other Default or impair
any right consequent thereto.
(b) Upon any such waiver, such Default shall cease to exist
and be deemed to have been cured and not to have occurred, and any Event of
Default arising therefrom shall be deemed to have been cured and not to have
occurred, for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or Event of Default or impair any right
consequent thereto.
SECTION 5.13 Undertaking for Costs. All parties to this
Indenture agree, and each Holder of any Note by such Holder's acceptance
thereof shall be deemed to have agreed, that any court may in its discretion
require, in any Proceeding for the enforcement of any right or remedy under
this Indenture, or in any Proceeding against the Indenture Trustee for any
action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such Proceeding of an undertaking to pay the costs of such
Proceeding, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees and expenses, against any party litigant
in such Proceeding, 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 5.13 shall not apply to:
(a) any Proceeding instituted by the Indenture Trustee;
(b) any Proceeding instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate more than 10% of the
aggregate principal amount of the Notes; or
(c) any Proceeding instituted by any Noteholder for the
enforcement of the payment of principal of or interest on any Note on or after
the respective due dates expressed in such Note and in this Indenture (or, in
the case of redemption, on or after the Redemption Date).
SECTION 5.14 Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it shall not at any
time insist upon, or plead or in any manner whatsoever,
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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 adversely affect the
covenants or the performance of this Indenture. The Issuer (to the extent that
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it shall not hinder, delay or impede the execution
of any power herein granted to the Indenture Trustee, but shall suffer and
permit the execution of every such power as though no such law had been
enacted.
SECTION 5.15 Action on Notes. The Indenture Trustee's right to
seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under or
with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be
impaired by the recovery of any judgment by the Indenture Trustee against the
Issuer or by the levy of any execution under such judgment upon any portion of
the Trust Estate or upon any of the assets of the Issuer. Any money or property
collected by the Indenture Trustee shall be applied in accordance with Section
5.4(b) hereof.
SECTION 5.16 Performance and Enforcement of Certain
Obligations.
--------------------------------------
(a) Promptly following a request from the Indenture Trustee to
do so and at the Administrator's expense, the Issuer agrees to take all such
lawful action as the Indenture Trustee may request to compel or secure the
performance and observance by the Transferor and the Servicer of their
respective obligations to the Issuer under or in connection with the Trust Sale
and Servicing Agreement and the Receivables Purchase Agreement or by World Omni
of its obligations under or in connection with the Receivables Purchase
Agreement in accordance with the terms thereof, and to exercise any and all
rights, remedies, powers and privileges lawfully available to the Issuer under
or in connection with the Trust Sale and Servicing Agreement to the extent and
in the manner directed by the Indenture Trustee, including the transmission of
notices of default on the part of the Transferor or the Servicer thereunder and
the institution of legal or administrative actions or proceedings to compel or
secure performance by the Transferor or the Servicer of each of their
obligations under the Trust Sale and Servicing Agreement.
(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and, at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter)) of the
Holders of 66-2/3% of the outstanding Notes of any outstanding Series shall,
exercise all rights, remedies, powers, privileges and claims of the Issuer
against the Transferor or the Servicer under or in connection with the Trust
Sale and Servicing Agreement, including the right or power to take any action
to compel or secure performance or observance by the Transferor or the Servicer
of each of their obligations to the Issuer thereunder and to give any consent,
request, notice, direction, approval, extension or waiver under the Trust Sale
and Servicing Agreement, and any right of the Issuer to take such action shall
be suspended.
(c) Promptly following a request from the Indenture Trustee to
do so and at the Administrator's expense, the Issuer agrees to take all such
lawful action as the Indenture Trustee may request to compel or secure the
performance and observance by World Omni and the Servicer of each
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of their obligations to the Transferor under or in connection with the
Receivables Purchase Agreement in accordance with the terms thereof, and to
exercise any and all rights, remedies, powers and privileges lawfully available
to the Issuer under or in connection with the Receivables Purchase 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 Transferor thereunder and
the institution of legal or administrative actions or proceedings to compel or
secure performance by World Omni and the Servicer of each of their obligations
under the Receivables Purchase Agreement.
(d) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and, at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter)) of the
Holders of 66-2/3% of the outstanding Notes of any outstanding Series shall,
exercise all rights, remedies, powers, privileges and claims of the Transferor
against World Omni and the Servicer under or in connection with the Receivables
Purchase Agreement, including the right or power to take any action to compel
or secure performance or observance by World Omni and the Servicer of each of
their obligations to the Transferor thereunder and to give any consent,
request, notice, direction, approval, extension or waiver under the Receivables
Purchase Agreement, and any right of the Transferor to take such action shall
be suspended.
SECTION 5.17 Early Amortization Events. An Early Amortization
Event for any Series of Notes shall be any of the events so defined in the
Series Supplement relating to a Series of Notes, as well as the following
events:
(a) a failure by the Transferor to convey Receivables in
Additional Accounts to the Trust within 15 Business Days after the day on which
it is required to convey such Accounts;
(b) the Transferor or the Servicer shall file a petition
commencing a voluntary case under any chapter of the federal bankruptcy laws;
or the Transferor or the Servicer shall file a petition or answer or consent
seeking reorganization, arrangement, adjustment, or composition under any other
similar applicable federal law, or shall consent to the filing of any such
petition, answer, or consent; or the Transferor or the Servicer shall appoint,
or consent to the appointment of, a custodian, receiver, liquidator, trustee,
assignee, sequestrator or other similar official in bankruptcy or insolvency of
it or of any substantial part of its property; or the Transferor or the
Servicer shall make an assignment for the benefit of creditors, or shall admit
in writing its inability to pay its debts generally as they become due;
(c) any order for relief against the Transferor or the
Servicer shall have been entered by a court having jurisdiction in the premises
under any chapter of the federal bankruptcy laws, and such order shall have
continued undischarged or unstayed for a period of 60 days; or a decree or
order by a court having jurisdiction in the premises shall have been entered
approving as properly filed a petition seeking reorganization, arrangement,
adjustment, or composition of the Transferor or the Servicer under any other
similar applicable federal law, and such decree or order shall have continued
undischarged or unstayed for a period of 120 days; or a decree or order of a
court having jurisdiction in the premises for the appointment of a custodian,
receiver, liquidator, trustee, assignee, sequestrator, or other similar
official
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in bankruptcy or insolvency of the Transferor or the Servicer or of any
substantial part of its property or for the winding up or liquidation of its
affairs, shall have been entered, and such decree or order shall have remained
in force undischarged or unstayed for a period of 120 days;
(d) World Omni or Toyota shall file a petition commencing a
voluntary case under any chapter of the federal bankruptcy laws; or World Omni
or Toyota shall file a petition or answer or consent seeking reorganization,
arrangement, adjustment, or composition under any other similar applicable
federal law, or shall consent to the filing of any such petition, answer, or
consent; or World Omni or Toyota shall appoint, or consent to the appointment
of, a custodian, receiver, liquidator, trustee, assignee, sequestrator or other
similar official in bankruptcy or insolvency of it or of any substantial part
of its property; or World Omni or Toyota shall make an assignment for the
benefit of creditors, or shall admit in writing its inability to pay its debts
generally as they become due;
(e) any order for relief against World Omni or Toyota shall
have been entered by a court having jurisdiction in the premises under any
chapter of the federal bankruptcy laws, and such order shall have continued
undischarged or unstayed for a period of sixty (60) days; or a decree or order
by a court having jurisdiction in the premises shall have been entered
approving as properly filed a petition seeking reorganization, arrangement,
adjustment, or composition of World Omni or Toyota under any other similar
applicable state or federal law, and such decree or order shall have continued
undischarged or unstayed for a period of one hundred and twenty (120) days; or
a decree or order of a court having jurisdiction in the premises for the
appointment of a custodian, receiver, liquidator, trustee, assignee,
sequestrator, or other similar official in bankruptcy or insolvency of World
Omni or Toyota or of any substantial part of its property, or for the winding
up or liquidation of its affairs, shall have been entered, and such decree or
order shall have remained in force undischarged or unstayed for a period of one
hundred and twenty (120) days; or
(f) the Trust or the Transferor shall become an
"investment company" within the meaning of the Investment Company Act.
Immediately upon the occurrence of any event described above or in the
related Series Supplement for a Series of Notes, subject to applicable law, and
after the applicable grace period, if any, an amortization event (an "Early
Amortization Event") shall occur without any notice or other action on the part
of any party, as set forth in the Series Supplement and solely with respect to
the affected Series.
SECTION 5.18 Investment Event. An Investment Event for any
Series of Notes shall be any of the events so defined in the Series Supplement
relating to the Series of Notes.
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ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1 Duties of Indenture Trustee.
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(a) If an Event of Default has occurred and is continuing of
which a Responsible Officer of the Indenture Trustee has actual knowledge, the
Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs, including without limitation, continuing to hold the
Trust Estate and receive collections on the Receivables included therein as
provided in the Trust Sale and Servicing Agreement.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this
Indenture and the Trust Sale and Servicing Agreement and no implied
covenants or obligations shall be read into this Indenture or the
Trust Sale and Servicing Agreement against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the
Indenture Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Indenture Trustee and
conforming to the requirements of this Indenture; provided, however,
that the Indenture Trustee shall examine the certificates and opinions
to determine whether or not they conform to the requirements of this
Indenture (but need not confirm or investigate the accuracy of any
mathematical calculations or other facts stated therein).
(c) The Indenture Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act or its own
wilful misconduct or bad faith, except that:
(i) this Section 6.1(c) does not limit the effect of
Section 6.1(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) 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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(e) Money held in trust by the Indenture Trustee need not be
segregated from other funds except to the extent required by law or the terms
of this Indenture or the Trust Sale and Servicing Agreement.
(f) No provision of this Indenture shall require the Indenture
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder or in the exercise of any of
its rights or powers, if it shall have reasonable grounds to believe that
repayments of such funds to it is not reasonably assured or it has not received
an indemnity reasonably satisfactory to it against such risk or liability.
(g) The Indenture Trustee shall have no discretionary duties
other than performing those ministerial acts set forth above necessary to
accomplish the purpose of the Trust as set forth in this Indenture.
(h) Every provision of this Indenture relating to the
Indenture Trustee shall be subject to the provisions of this Section 6.1 and,
if the Indenture is or is required to be qualified under this TIA, to the
provisions of the TIA.
SECTION 6.2 Rights of Indenture Trustee.
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(a) The Indenture Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting on any document believed by
it to be genuine and to have been signed or presented by the proper Person. The
Indenture Trustee shall not be bound to make any investigation into any fact or
matter stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond or other paper or
document.
(b) Before the Indenture Trustee acts or refrains from acting,
it may require an Officer's Certificate from the Issuer or an Opinion of
Counsel that such action or omission is required or permitted hereunder. 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, any such agent, attorney, custodian or nominee
appointed with due care by it hereunder.
(d) The Indenture Trustee shall not be liable for any action
it takes or omits to take in good faith which it believes to be authorized or
within its rights or powers; provided, however, that the Indenture Trustee's
conduct does not constitute wilful misconduct, negligence or bad faith.
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(e) The Indenture Trustee may consult with counsel, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and protection
from liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the advice or opinion of such
counsel.
(f) The Indenture Trustee shall not be under any obligation to
take any action that is discretionary under the provisions of this Indenture.
(g) The Indenture Trustee shall not be charged with knowledge
of any default or event of default unless either (i) a Responsible Officer of
the Indenture Trustee shall have actual knowledge or (ii) the Indenture Trustee
shall have received written notice thereof from the Issuer or a Holder.
(h) The Indenture Trustee shall have no duty to monitor the
performance of the Issuer nor shall it have any liability (in its capacity as
Indenture Trustee) in connection with the malfeasance or nonmalfeasance by the
Issuer. The Indenture Trustee shall have no liability in connection with
compliance by the Issuer with statutory or regulatory requirements related to
the Collateral. The Indenture Trustee shall not make or be deemed to have made
any representations or warranties with respect to the Collateral or adequacy
thereof or the validity or sufficiency of any assignment of the Collateral to
the Indenture Trustee.
(i) Except as otherwise explicitly set forth in this
Indenture, the Indenture Trustee shall have no duty or obligation, implied or
otherwise, to (i) attend any meetings of the Issuer's management or membership,
(ii) inspect the accounts or books and records of the Issuer, (iii) otherwise
insure that the Noteholders remain informed about the business of the Issuer or
(iv) furnish to the Noteholders any information from the Issuer by the
Indenture Trustee.
SECTION 6.3 Indenture Trustee May Own Notes. The Indenture
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Issuer, the Servicer or any of their
respective Affiliates with the same rights it would have if it were not
Indenture Trustee; provided, however, that the Indenture Trustee shall comply
with Sections 6.10 and 6.11. Any Paying Agent, Note Registrar, co-registrar or
co-paying agent may do the same with like rights.
SECTION 6.4 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 or the Notes, it shall not be
accountable for the Issuer's use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in the Indenture or in any
document issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee's certificate of authentication.
SECTION 6.5 Notice of Defaults. If a Default occurs and is
continuing and if it is actually known to a Responsible Officer of the
Indenture Trustee, the Indenture Trustee shall mail to each Noteholder notice
of the Default within 60 days after obtaining actual knowledge of the
occurrence thereof. Except in the case of a Default in payment of principal of
or interest on any Note, the Indenture Trustee
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may withhold the notice if and so long as a committee of its Responsible
Officers in good faith determines that withholding the notice is in the
interests of Noteholders.
SECTION 6.6 Reports by Indenture Trustee to Holders. The
Indenture Trustee shall deliver to each Noteholder the information and
documents set forth in Article VII, and, in addition, all such information with
respect to the Notes as may be required by the terms of the Trust Sale and
Servicing Agreement to be provided to Holders by the Indenture Trustee to
enable such Holder to prepare its federal and state income tax returns within a
reasonable time after the Servicer has provided the Indenture Trustee with the
information required by the Indenture Trustee to make such deliveries.
SECTION 6.7 Compensation; Indemnity.
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(a) The Issuer shall pay, out of funds which are otherwise to
be distributed to the Certificateholders or to be deposited in the Certificate
Distribution Account, or shall cause the Servicer pursuant to any Series
Supplement and Section 3.2 of the Trust Sale and Servicing Agreement to pay to
the Indenture Trustee from time to time such compensation for its services as
shall be agreed upon in writing. The Indenture Trustee's compensation shall not
be limited by any law on compensation of a trustee of an express trust. The
Issuer shall or shall cause the Servicer pursuant to any Series Supplement and
Section 3.2 of the Trust Sale and Servicing Agreement to reimburse, out of
funds which are otherwise to be distributed to the Certificateholders or to be
deposited in the Certificate Distribution Account, the Indenture Trustee for
all reasonable out-of-pocket expenses incurred or made by it, including costs
of collection, in addition to the compensation for its services. Such expenses
shall include the reasonable compensation and expenses, disbursements and
advances of the Indenture Trustee's agents, counsel, accountants and experts.
The Issuer shall or shall cause the Servicer pursuant to the Trust Sale and
Servicing Agreement to indemnify, out of funds which are otherwise to be
distributed to the Certificateholders or to be deposited in the Certificate
Distribution Account, against any and all loss, liability or expense (including
attorneys' fees and expenses) incurred by the Indenture Trustee in accordance
with Section 6.4 of the Trust Sale and Servicing Agreement. The Indenture
Trustee shall notify the Servicer promptly of any claim for which it may seek
indemnity. Failure by the Indenture Trustee to so notify the Issuer shall not
relieve the Issuer or the Servicer of its obligations hereunder. The Issuer
shall defend or cause the Servicer to defend any such claim, and the Indenture
Trustee may have separate counsel and the Issuer shall pay, out of funds which
are otherwise to be distributed to the Certificateholders or to be deposited in
the Certificate Distribution Account, or shall cause the Servicer to pay the
fees and expenses of such counsel.
(b) The Issuer's obligation to cause the Servicer to honor the
Issuer's obligations to the Indenture Trustee specified in Section 6.7(a) shall
survive the discharge of this Indenture or the earlier resignation or removal
of the Indenture Trustee. When the Indenture Trustee incurs expenses after the
occurrence of a Default specified in Section 5.1(e) or (f) with respect to the
Issuer, if the surviving entity has failed to honor such obligation the
expenses are intended to constitute expenses of administration under any
Insolvency Law or under Title 11 of the United States Code.
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SECTION 6.8 Replacement of Indenture Trustee.
--------------------------------
(a) The Indenture Trustee may at any time give notice of its
intent to resign by so notifying the Issuer; provided, however, that no such
resignation shall become effective and the Indenture Trustee shall not resign
prior to the time set forth in Section 6.8(c). The Holders of a majority in
aggregate amount of the outstanding Notes may remove the Indenture Trustee by
so notifying the Indenture Trustee and may appoint a successor Indenture
Trustee. Such resignation or removal shall become effective in accordance with
Section 6.8(c). The Issuer shall remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with
Section 6.11;
(ii) the Indenture Trustee is adjudged bankrupt or
insolvent;
(iii) a receiver or other public officer takes charge
of the Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes
incapable of acting.
(b) If the Indenture Trustee gives notice of its intent to
resign or is removed or if a vacancy exists in the office of Indenture Trustee
for any reason (the Indenture Trustee in such event being referred to herein as
the retiring Indenture Trustee), the Issuer shall promptly appoint and
designate a successor Indenture Trustee by written notice to the resigning
Indenture Trustee.
(c) A successor Indenture Trustee shall deliver a written
acceptance of its appointment and designation to the retiring Indenture Trustee
and to the Issuer. Thereupon the resignation or removal of the retiring
Indenture Trustee shall become effective, and the successor Indenture Trustee
shall have all the rights, powers and duties of the Indenture Trustee under
this Indenture. The successor Indenture Trustee shall mail a notice of its
succession to Noteholders. The Issuer shall release the resigning Indenture
Trustee from its obligations hereunder by written instrument. The retiring
Indenture Trustee shall promptly transfer all property held by it as Indenture
Trustee to the successor Indenture Trustee.
(d) If a successor Indenture Trustee does not take office
within 60 days after the retiring Indenture Trustee gives notice of its intent
to resign or is removed, the retiring Indenture Trustee, the Issuer or the
Holders of a majority in aggregate amount of the outstanding Notes may petition
any court of competent jurisdiction for the appointment and designation of a
successor Indenture Trustee.
(e) If the Indenture Trustee fails to comply with Section
6.11, any Noteholder may petition any court of competent jurisdiction for the
removal of the Indenture Trustee and the appointment of a successor Indenture
Trustee.
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(f) Notwithstanding the replacement of the Indenture Trustee
pursuant to this Section 6.8, the Issuer's obligations under Section 6.7 and
the Servicer's corresponding obligations under the Trust Sale and Servicing
Agreement shall continue for the benefit of the retiring Indenture Trustee.
SECTION 6.9 Merger or Consolidation of Indenture Trustee.
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(a) Any corporation into which the Indenture Trustee may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Indenture
Trustee shall be a party, or any corporation succeeding to all or substantially
all of the corporate trust business of the Indenture Trustee, shall be the
successor of the Indenture Trustee under this Indenture; provided, however,
that such corporation shall be eligible under the provisions of Section 6.11,
without the execution or filing of any instrument or any further act on the
part of any of the parties to this Indenture except where an instrument of
transfer or assignment is required by law to effect such succession, anything
in this Indenture to the contrary notwithstanding.
(b) If at the time such successor or successors by merger or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture, any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the
certificate of authentication of any predecessor trustee, and deliver such
Notes so authenticated; and in case at that time any of the Notes shall not
have been authenticated, any successor to the Indenture Trustee may
authenticate such Notes either in the name of any predecessor hereunder or in
the name of the successor to the Indenture Trustee. In all such cases such
certificate of authentication shall have the same full force as is provided
anywhere in the Notes or herein with respect to the certificate of
authentication of the Indenture Trustee.
SECTION 6.10 Appointment of Co-Indenture Trustee or Separate
Indenture Trustee.
-----------------------------------------------
(a) Notwithstanding any other provisions of this Indenture, at
any time, for the purpose of meeting any legal requirement of any jurisdiction
in which any part of the Issuer or any Dealer may at the time be located, the
Indenture Trustee shall have the power and may execute and deliver all
instruments to appoint one or more Persons approved by the Indenture Trustee to
act as a co-trustee or co-trustees, jointly with the Indenture Trustee, or
separate indenture trustees, of all or any part of the Trust, and to vest in
such Person or Persons, in such capacity and for the benefit of the Noteholders
and (only to the extent expressly provided herein) the Certificateholders, such
title to the Collateral, or any part hereof, and, subject to the other
provisions of this Section 6.10, such powers, duties, obligations, rights and
trusts as the Indenture Trustee may consider necessary or desirable. No
co-indenture trustee or separate indenture trustee hereunder shall be required
to meet the terms of eligibility as a successor trustee under Section 6.11 and
no notice to Noteholders of the appointment of any co-indenture trustee or
separate indenture trustee shall be required under Section 6.8.
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(b) Every separate indenture trustee and co-indenture trustee
shall, to the extent permitted by law, be appointed and act subject to the
following provisions and conditions:
(i) all rights, powers, duties and obligations
conferred or imposed upon the Indenture Trustee shall be conferred or
imposed upon and exercised or performed by the Indenture Trustee and
such separate trustee or co-trustee jointly (it being understood that
such separate indenture trustee or co-indenture 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 Issuer 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 indenture trustee hereunder shall be
personally liable by reason of any act or omission of any other
indenture trustee hereunder; and
(iii) the Indenture Trustee may at any time accept
the resignation of or remove any separate indenture trustee or
co-indenture 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 indenture trustees and co-indenture 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 VI.
Each separate indenture trustee and co-indenture trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Indenture Trustee or
separately, as may be provided therein, subject to all the provisions of this
Indenture, specifically including every provision of this Indenture relating to
the conduct of, affecting the liability of, or affording protection to, the
Indenture Trustee. Every such instrument shall be filed with the Indenture
Trustee.
(d) Any separate indenture trustee or co-indenture trustee may
at any time appoint the Indenture Trustee as its agent or attorney-in-fact with
full power and authority, to the extent not prohibited by law, to do any lawful
act under or in respect of this Indenture on its behalf and in its name. If any
separate indenture trustee or co-indenture trustee shall die, become incapable
of acting, resign or be removed, all of its estates, properties, rights,
remedies and trusts shall vest in and be exercised by the Indenture Trustee, to
the extent permitted by law, without the appointment of a new or successor
indenture trustee.
SECTION 6.11 Eligibility; Disqualification. The Indenture
Trustee shall at all times satisfy the requirements of TIA ss. 310(a) and
Section 26(a) of the Investment Company Act. The Indenture Trustee shall have a
combined capital and surplus, and an aggregate capital, surplus and undivided
profits, of at least $50,000,000 as set forth in its most recent published
annual report of condition
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and (unless waived by Moody's and Standard and Poor's) it shall have a long
term unsecured debt rating of Baa3 or better by Moody's. The Indenture Trustee
shall comply with TIA ss. 310(b); provided, however, that there shall be
excluded from the operation of TIA ss. 310(b)(1) any indenture or indentures
under which other securities of the Issuer are outstanding if the requirements
for such exclusion set forth in TIA ss. 310(b)(1) are met.
SECTION 6.12 Preferential Collection of Claims Against Issuer.
The Indenture Trustee shall comply with TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated.
SECTION 6.13 Representations and Warranties of Indenture
Trustee. The Indenture Trustee represents and warrants as of the Closing Date
that:
(a) the Indenture Trustee is an Illinois banking corporation
and satisfies the eligibility requirements set forth in Section 6.11;
(b) the Indenture Trustee has full power, authority and legal
right to execute, deliver and perform this Indenture, and has taken all
necessary action to authorize the execution, delivery and performance by it of
this Indenture;
(c) the execution, delivery and performance by the Indenture
Trustee of this Indenture (i) shall not violate any provision of any law or
regulation governing the banking and trust powers of the Indenture Trustee or
any order, writ, judgment or decree of any court, arbitrator, or Governmental
Authority applicable to the Indenture Trustee or any of its assets, (ii) shall
not violate any provision of the corporate charter or by-laws of the Indenture
Trustee and (iii) shall not violate any provision of, or constitute, with or
without notice or lapse of time, a default under, or result in the creation or
imposition of any lien on any properties included in the Trust Estate pursuant
to the provisions of any mortgage, indenture, contract, agreement or other
undertaking to which it is a party, which violation, default or lien could
reasonably be expected to have a materially adverse effect on the Indenture
Trustee's performance or ability to perform its duties under this Indenture or
on the transactions contemplated in this Indenture;
(d) the execution, delivery and performance by the Indenture
Trustee of this Indenture shall not require the authorization, consent or
approval of, the giving of notice to, the filing or registration with, or the
taking of any other action in respect of, any Governmental Authority or agency
regulating the banking and corporate trust activities of the Indenture Trustee;
and
(e) this Indenture has been duly executed and delivered by the
Indenture Trustee and constitutes the legal, valid and binding agreement of the
Indenture Trustee, enforceable in accordance with its terms.
(f) The Indenture Trustee certifies that (a) its principal
place of business is outside the State of Florida, and it has no place of
business or assets in the State of Florida; (b) its usual place of
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business where books and records pertaining to the Indenture will be kept is
outside the State of Florida; (c) it has a division that is licensed to sell
municipal bonds in the State of Florida, but it has no offices located in the
State of Florida to sell the municipal bonds or provide banking and trustee
services, and files no tax returns with the State of Florida; (d) it has
employees employed within the State of Florida who provide services to an
affiliate of the Indenture Trustee, but who in no event manage or control
assets of the Indenture Trustee, and it does not engage in any material actions
on behalf of the Indenture Trustee in the State of Florida; and (f) it is not
organized under the laws of the State of Florida. The Indenture Trustee will
certify the above by September 30 each year this Agreement is in effect by
providing an Officer's Certificate in the form of Exhibit C attached hereto.
Additionally, the Indenture Trustee certifies and agrees that it will promptly
notify the Issuer if any of the above changes.
SECTION 6.14 Indenture Trustee May Enforce Claims Without
Possession of Notes. All rights of action and claims under this Indenture or
the Notes may be prosecuted and enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any proceeding
relating thereto, and any such proceeding instituted by the Indenture Trustee
shall be brought in its own name as Indenture Trustee. Any recovery of judgment
shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee, its agents and
counsel, be for the ratable benefit of the Noteholders and (only to the extent
expressly provided herein) the Certificateholders in respect of which such
judgment has been obtained.
SECTION 6.15 Suit for Enforcement. If an Event of Default
shall occur and be continuing, the Indenture Trustee, in its discretion may,
subject to the provisions of Section 6.1, proceed to protect and enforce its
rights and the rights of the Noteholders under this Indenture by a Proceeding
whether for the specific performance of any covenant or agreement contained in
this Indenture or in aid of the execution of any power granted in this
Indenture or for the enforcement of any other legal, equitable or other remedy
as the Indenture Trustee, being advised by counsel, shall deem necessary to
protect and enforce any of the rights of the Indenture Trustee or the
Noteholders.
SECTION 6.16 Rights of Noteholders to Direct Indenture
Trustee. Holders of Notes evidencing not less than a majority in aggregate
principal amount of the outstanding Notes shall have the right to direct in
writing the time, method and place of conducting any Proceeding for any remedy
available to the Indenture Trustee or exercising any trust or power conferred
on the Indenture Trustee; provided, however, that subject to Section 6.1, the
Indenture Trustee shall have the right to decline to follow any such direction
if the Indenture Trustee, being advised by counsel, determines that the action
so directed may not lawfully be taken, or if the Indenture Trustee in good
faith shall, by a Responsible Officer, determine that the proceedings so
directed would be illegal or subject it to personal liability or be unduly
prejudicial to the rights of Noteholders not parties to such direction; and
provided, further, that nothing in this Indenture shall impair the right of the
Indenture Trustee to take any action deemed proper by the Indenture Trustee and
which is not inconsistent with such direction by the Noteholders.
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ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 Issuer To Furnish Indenture Trustee Names and
Addresses of Noteholders. The Issuer shall furnish or cause to be furnished by
the Servicer to the Indenture Trustee (a) not more than five days before each
date on which payments are to be made, a list, in such form as the Indenture
Trustee may reasonably require, of the names and addresses of the Holders of
Notes as of the close of business on the related Record Date, and (b) at such
other times as the Indenture Trustee may request in writing, within 14 days
after receipt by the Issuer of any such request, a list of similar form and
content as of a date not more than 10 days prior to the time such list is
furnished; provided, however, that so long as the Indenture Trustee is the Note
Registrar, no such list shall be required to be furnished.
SECTION 7.2 Preservation of Information, Communications to
Noteholders.
----------------------------------------------
(a) The Indenture Trustee shall preserve, in as current a form
as is reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as
provided in Section 7.1 and the names and addresses of Holders of Notes
received by the Indenture Trustee in its capacity as Note Registrar. The
Indenture Trustee may destroy any list furnished to it as provided in such
Section 7.1 upon receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA ss. 312(b)
with other Noteholders with respect to their rights under this Indenture or
under the Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar
shall have the protection of TIAss. 312(c).
SECTION 7.3 Reports by Issuer.
-----------------
(a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days
after the Issuer is required to file the same with the Commission or
any applicable state agencies, copies of the annual reports and of the
information, documents and other reports (or copies of such portions
of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Issuer may be required to
file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act or any applicable state agencies pursuant to comparable
regulation;
(ii) file with the Indenture Trustee and the
Commission or any applicable state agencies in accordance with rules
and regulations prescribed from time to time by the Commission or any
applicable state agencies such additional information, documents and
reports with respect to compliance by the Issuer with the conditions
and covenants of this Indenture as may be required from time to time
by such rules and regulations; and
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(iii) supply to the Indenture Trustee (and the
Indenture Trustee shall transmit by mail to all Noteholders described
in TIA ss. 313(c)) such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to clauses (i) and
(ii) of this Section 7.3(a) as may be required by rules and
regulations prescribed from time to time by the Commission or any
applicable state agencies.
(b) Unless the Issuer otherwise determines, the fiscal year o
the Issuer shall end on December 31 of such year.
SECTION 7.4 Reports by Indenture Trustee.
----------------------------
(a) If required by TIA ss. 313(a), within 60 days after each
May 1, beginning with May 1, 2000, the Indenture Trustee shall mail to each
Noteholder as required by TIA ss. 313(c) a brief report dated as of such date
that complies with TIA ss. 313(a). If the Indenture is or is required to be
qualified under the TIA, the Indenture Trustee also shall comply with TIA ss.
313(b). A copy of any report delivered pursuant to this Section 7.4(a) shall,
at the time of its mailing to Noteholders, be filed by the Indenture Trustee
with the Commission, if required by applicable rules, and each stock exchange,
if any, on which the Notes are listed. The Issuer shall notify the Indenture
Trustee in writing if and when the Notes are listed on any stock exchange. The
report contemplated by this Section 7.4(a) shall include the following
information concerning the Indenture Trustee:
(i) its eligibility and qualifications to continue
as Indenture Trustee under this Indenture;
(ii) any amounts advanced by the Indenture Trustee
under this Indenture;
(iii) the amount, interest rate and maturity date of
specified indebtedness owing by the Issuer to the Indenture Trustee in
its individual capacity;
(iv) the property and funds physically held by the
Indenture Trustee as trustee; and
(v) any action taken by the Indenture Trustee that
materially affects the Notes and that has not been previously
reported.
(b) On each Payment Date, the Indenture Trustee shall include
with each payment to each Noteholder a copy of the statement for the Collection
Period or Periods applicable to such Payment Date as required pursuant to
Section 3.4 of the Trust Sale and Servicing Agreement provided, the Servicer
has provided the Indenture Trustee with such information as required.
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ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 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, the Receivables Purchase Agreement and the Trust Sale and Servicing
Agreement. 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 Event of Default
under this Indenture and any right to proceed thereafter as provided in Article
V.
SECTION 8.2 Trust Accounts; Allocations; Payments.
-------------------------------------
(a) On or prior to the Closing Date, the Issuer shall cause
the Servicer to establish and maintain, in the name of the Indenture Trustee,
for the benefit of the Noteholders, the Trust Accounts as provided in any
Series Supplement and Section 4.2 of the Trust Sale and Servicing Agreement (or
with respect to any Trust Account for any Series of Notes issued after the
Closing Date, on or prior to the closing date with respect to such Series of
Notes).
(b) Subject to and in accordance with Section 8.2(c),
collections of Non-Principal Receivables and Principal Receivables, Defaulted
Receivables and Miscellaneous Payments will be allocated to each Series from
and after the related Series Cut-Off Date on the basis of the Series Allocable
Non-Principal Collections, Series Allocable Principal Collections, Series
Allocable Defaulted Amount and Series Allocable Miscellaneous Payments for such
Series, respectively, and amounts so allocated to any Series will not, except
as specified in the related Supplement, be available to the Noteholders of any
other Series. Allocations thereof among the Series in any group and among the
Classes in any Series and between the Noteholders and the Certificateholders
shall be set forth in the related Supplement or Supplements.
(c) For purposes of determining the Series Allocation
Percentage for any Series in connection with the allocation of Non-Principal
Receivables and Principal Receivables, Defaulted Receivables and Miscellaneous
Payments for the specified Collection Period:
(i) unless the related Supplement shall provide
otherwise, each Series upon issuance, shall be deemed to have been
created and in existence as of the first day of the Collection Period
in which the related Series Cut-Off Date falls and, as a result, shall
be allocated (based on its Series Allocation Percentage) its allocable
portion of Non-Principal Receivables and
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Principal Receivables, Defaulted Receivables and Miscellaneous
Payments for such Collection Period; and
(ii) unless the related Series Supplement shall
provide otherwise, with respect to any Series, if (x) as of the last
day of any Collection Period the amounts on deposit in the Collection
Account and the related Series Accounts are sufficient to pay in full
the outstanding principal amount, accrued interest and all other
amounts payable by the Trust (whether or not then due) with respect to
any such Series of Notes on the Payment Date relating to such
Collection Period (after giving effect to the allocations,
distributions, withdrawals and deposits to be made on such related
Payment Date) then (y) such Series shall be deemed to have been paid
in full on such last day and, as a result, shall not be allocated any
portion of Non-Principal Receivables and Principal Receivables,
Defaulted Receivables and Miscellaneous Payments for any subsequent
Collection Period. For purposes of making the determination in clause
(x) above, on the date of any such determination it shall be assumed
that any theretofore unpaid Adjustment Payments with respect to the
immediately preceding Collection Period shall be allocated to such
Series on the related Determination Date and shall be payable from
amounts allocated to or available with respect to such Series on the
related Payment Date.
(d) On or before the date any distribution is to be made by
the Indenture Trustee, all amounts required to be disbursed by the Indenture
Trustee will be deposited by the Indenture Trustee upon receipt into the
applicable Principal Funding Account or such other Trust Account as shall be
specified in the related Series Supplement. The Indenture Trustee shall (unless
otherwise provided in any Series Supplement) allocate the amount deposited into
such Principal Funding Account and such other Trust Accounts to the extent and
at the times as provided in the related Series Supplement. The Indenture
Trustee shall pay amounts to the Holders of such Series to the extent and at
the times provided in the related Series Supplement.
(e) The Indenture Trustee shall allocate amounts deposited in
a Principal Funding Account for payments of principal on the applicable Series
of Notes, and pay amounts to the Holders thereof, to the extent and at the
times provided in the related Series Supplements.
(f) Notwithstanding anything to the contrary herein, all
investment earnings on funds on deposit in the Principal Funding Account, net
of losses and investment expenses, shall constitute Investment Proceeds and be
applied as described in the related Series Supplement.
(g) Notwithstanding any provision of this Indenture to the
contrary, for so long as the Transferor is the sole Certificateholder and until
the Indenture Trustee shall have received written notice from the Trust or the
Transferor to the contrary, all amounts to be distributed by the Indenture
Trustee to the Certificateholders or the Certificate Distribution Account shall
be distributed to the Transferor to the account specified by the Transferor.
SECTION 8.3 General Provisions Regarding Trust Accounts.
-------------------------------------------
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(a) Subject to Section 6.1(c), the Indenture Trustee shall not
in any way be held liable by reason of any insufficiency in any of the Trust
Accounts resulting from any loss on any Eligible Investment included therein
except for losses attributable to the Indenture Trustee's failure to make
payments on such Eligible Investments issued by the Indenture Trustee, in its
commercial capacity as principal obligor and not as trustee, in accordance with
their terms.
(b) If (i) the Servicer shall have failed to give investment
directions for any funds on deposit in the Trust Accounts to the Indenture
Trustee by 11:00 a.m., New York City time (or such other time as may be agreed
by the Servicer and the Indenture Trustee) on any Business Day or (ii) an Event
of Default shall have occurred and be continuing with respect to the Notes but
the Notes shall not have been declared due and payable pursuant to Section 5.2,
or, (iii) if such Notes shall have been declared due and payable following an
Event of Default, but amounts collected or receivable from the Trust Estate are
being applied in accordance with Section 5.5 as if there had not been such a
declaration, then the Indenture Trustee shall, to the fullest extent
practicable, invest and reinvest funds in the Trust Accounts in Eligible
Investments specified in clause (j) of the definition thereof.
SECTION 8.4 Release of Trust Estate.
-----------------------
(a) Subject to the payment of its fees and expenses pursuant
to Section 6.7, 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 consistent with the provisions of this
Indenture. No party relying upon an instrument executed by the Indenture
Trustee as provided in this Article VIII shall be bound to ascertain the
Indenture Trustee's authority, inquire into the satisfaction of any conditions
precedent or see to the application of any monies.
(b) The Indenture Trustee shall, at such time as there are no
Notes Outstanding and all sums due to the Indenture Trustee pursuant to Section
6.7 have been paid, notify the Issuer thereof in writing and upon receipt of an
Issuer Request, release any remaining portion of the Trust Estate that secured
the Notes from the lien of this Indenture and release to the Issuer or any
other Person entitled thereto any funds then on deposit in the Collection
Account, the Excess Funding Account and, except as otherwise specified in the
related Series Supplement, any other Trust Account. The Indenture Trustee shall
(i) release any remaining portion of the Trust Estate that secured the
Certificates from the lien of this Indenture and (ii) release to the Issuer or
any other Person entitled thereto any funds then on deposit in the Collection
Account only at such time as (x) there are no Notes Outstanding and (y) all
sums due to the Indenture Trustee pursuant to Section 6.7 have been paid.
SECTION 8.5 Opinion of Counsel. The Indenture Trustee shall
receive at least seven days' notice when requested by the Issuer to take any
action pursuant to this Section 8.4, accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require as a condition to such
action, an Opinion of Counsel and an Officer's Certificate, in form and
substance satisfactory to the
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Indenture Trustee, stating the legal effect of any such action, outlining the
steps required to complete the same, and concluding that all conditions
precedent to the taking of such action have been complied with and such action
shall not materially and adversely impair the security for the Notes or the
rights of the Noteholders in contravention of the provisions of this Indenture;
provided, however, that such Opinion of Counsel shall not be required to
express an opinion as to the fair value of the Trust Estate. Counsel rendering
any such opinion may rely, without independent investigation, on the accuracy
and validity of any certificate or other instrument delivered to the Indenture
Trustee pursuant to the provisions of this Indenture in connection with any
such action.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of
Noteholders.
------------------------------------------
(a) Without the consent of the Holders of any Notes but with
prior notice to the Rating Agencies, the Issuer and the Indenture Trustee, when
authorized by an Issuer Order, at any time and from time to time, may enter
into one or more indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as in force at the date of the execution
thereof), in form satisfactory to the Indenture Trustee, for any of the
following purposes:
(i) to correct or amplify the description of any
property at any time subject to the lien of this Indenture, or better
to assure, convey and confirm unto the Indenture Trustee any property
subject or required to be subjected to the lien of this Indenture, or
to subject additional property to the lien of this Indenture;
(ii) to evidence the succession, in compliance with
Section 3.10 and 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 Notes;
(iii) to add to the covenants of the Issuer for the
benefit of the Noteholders;
(iv) to convey, transfer, assign, mortgage or pledge
any property to or with the Indenture Trustee;
(v) to cure any ambiguity or to correct or
supplement any provision herein or in any supplemental indenture which
may be inconsistent with any other provision herein or in any
supplemental indenture;
(vi) to evidence and provide for the acceptance of
the appointment hereunder by a successor trustee with respect to the
Notes and the Indenture and to add to or change any
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of the provisions of this Indenture as shall be necessary to
facilitate the administration of the trusts hereunder by more than one
trustee, pursuant to the requirements of Article VI; and
(vii) to modify, eliminate or add to the provisions
of this Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar
federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA, and the
Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by
an Issuer Order, may, also without the consent of any of the Noteholders but
with prior notice to the Rating Agencies, at any time and from time to time
enter into one or more indentures supplemental hereto for the purpose of adding
any provisions to, changing in any manner, or eliminating any of the provisions
of, this Indenture or modifying in any manner the rights of the Noteholders
under this Indenture; provided, however, that such action shall not, as
evidenced by an Officer's Certificate, adversely affect in any material respect
the interests of any Noteholder unless such Noteholders' consent is obtained.
SECTION 9.2 Supplemental Indentures With Consent of
Noteholders.
---------------------------------------
(a) The Issuer and the Indenture Trustee, when authorized by
an Issuer Order, also may, with prior notice to the Rating Agencies and with
the written consent of the Holders of not less than a majority of the principal
amount of the Controlling Class of each Series of Notes affected thereby, by
Act of such Holders delivered to the Issuer and the Indenture Trustee, enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to, changing in any manner, or eliminating any of the provisions
of, this Indenture or modifying in any manner the rights of the Noteholders
under this Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each outstanding Note affected
thereby:
(i) change the due date of any installment of
principal of or interest on any Note, or reduce the principal amount
thereof, the interest rate applicable thereto, or the Redemption Price
with respect thereto, change any place of payment where, or the coin
or currency in which, any Note or any interest thereon is payable, or
impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of funds
available therefor, as provided in Article V, to the payment of any
such amount due on the Notes on or after the respective due dates
thereof (or, in the case of redemption, on or after the Redemption
Date);
(ii) reduce the percentage of the aggregate
outstanding principal amount of the Notes, the consent of the Holders
of which is required for any such supplemental indenture, or the
consent of the Holders of which is required for any waiver of
compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences as provided for in this
Indenture;
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(iii) impair the right to institute suit for the
enforcement of specified provisions of this Indenture regarding
payment;
(iv) reduce the percentage of the aggregate
outstanding principal amount of the Notes required to direct the
Indenture Trustee to sell or liquidate the Trust Estate pursuant to
Section 5.4 if the proceeds of such sale would be insufficient to pay
the principal amount of and accrued but unpaid interest on the
outstanding Notes;
(v) modify any provision of this Section 9.2 to
decrease the required minimum percentage necessary to approve any
amendments to any provisions of this Indenture;
(vi) modify or alter the provisions of the Indenture
regarding the voting of Notes held by the Issuer, the Transferor or
any Affiliate of either of them; or
(vii) permit the creation of any Lien ranking prior
to or on a parity with the Lien of this Indenture with respect to any
part of the Trust Estate or, except as otherwise permitted or
contemplated herein, terminate the Lien of this Indenture on any
property at any time subject hereto or deprive the Holder of any Note
of the security afforded by the lien of this Indenture.
(b) The Indenture Trustee may in its discretion determine
whether or not any Notes would be affected (such that the consent of each
Noteholder would be required) by any supplemental indenture proposed pursuant
to this Section 9.2 and any such determination shall be conclusive and binding
upon the Holders of all Notes, whether authenticated and delivered thereunder
before or after the date upon which such supplemental indenture becomes
effective. The Indenture Trustee shall not be liable for any such determination
made in good faith.
(c) It shall be sufficient if an Act of Noteholders
approves the substance, but not the form, of any proposed supplemental
indenture.
(d) Promptly after the execution by the Issuer and the
Indenture Trustee of any supplemental indenture pursuant to this Section 9.2,
the Indenture Trustee shall mail to the Noteholders to which such amendment or
supplemental indenture relates a notice setting forth in general terms the
substance of such supplemental indenture. Any failure of the Indenture Trustee
to mail such notice, or any defect therein, shall not, however, in any way
impair or affect the validity of any such supplemental indenture.
SECTION 9.3 Execution of Supplemental Indentures. In
executing, or permitting the additional trusts created by any supplemental
indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Indenture Trustee shall be entitled to
receive, and subject to Sections 6.1 and 6.2, shall be fully protected in
relying upon, an Opinion of Counsel and an Officer's Certificate stating that
the execution of such supplemental indenture is authorized or permitted by
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this Indenture and that all conditions precedent to the execution of any such
amendment have been satisfied. The Indenture Trustee may, but shall not be
obligated to, enter into any such supplemental indenture that affects the
Indenture Trustee's own rights, duties, liabilities or immunities under this
Indenture or otherwise.
SECTION 9.4 Effect of Supplemental Indenture. Upon the
execution of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective
rights, limitations of rights, obligations, duties, liabilities and immunities
under this Indenture of the Indenture Trustee, the Issuer and the Noteholders
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 9.5 Conformity with Trust Indenture Act. Every
amendment of this Indenture and every supplemental indenture executed pursuant
to this Article IX shall conform to the requirements of the TIA as then in
effect so long as this Indenture shall then be qualified under the TIA.
SECTION 9.6 Reference in Notes to Supplemental Indentures.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article IX may, and if required by the Indenture
Trustee shall, bear a notation in form approved by the Indenture Trustee as to
any matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the Issuer, to any such supplemental
indenture may be prepared and executed by the Issuer and authenticated and
delivered by the Indenture Trustee in exchange for Outstanding Notes of the
same Series.
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1 Redemption.
----------
(a) A Series of Notes shall be subject to redemption if and
to the extent provided in the related Series Supplement.
(b) Each Series of Notes shall be subject to redemption as set
forth in this Section 10.1(b). In the event of any breach of any of the
representations and warranties set forth in Section 2.3 of the Trust Sale and
Servicing Agreement shall have a material adverse effect on the Noteholders,
then either the Indenture Trustee or the Holders of Notes evidencing not less
than a majority in aggregate unpaid principal amount of the Controlling Class
of each Series of Notes, by written notice to the Issuer and the Indenture
Trustee may direct the Issuer to redeem all of the Notes then outstanding on
the second Payment Date following the date of such notice (or such later date
as may be specified in such notice); provided, however, that no such redemption
shall be required to be made if on or prior to the earlier of the date the
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Redemption Notice is or is required to be sent to Noteholders, the
representations and warranties set forth in Section 2.3 of the Trust Sale and
Servicing Agreement are satisfied in all material respects and any material
adverse effect on the Noteholders caused thereby shall have been cured. The
Issuer shall promptly furnish a copy of such notice to the Transferor.
(c) The redemption price for any Notes shall be equal to the
applicable Redemption Price set forth in the related Series Supplement. The
Issuer shall only be required to redeem Notes if it has available funds
sufficient to pay such amount. The Issuer shall furnish the Rating Agencies
notice of any such redemption. If any Notes are to be redeemed pursuant to this
Section 10.1(a), the Issuer shall furnish notice thereof to the Indenture
Trustee not later than 10 days prior to the applicable Redemption Date and the
Issuer shall deposit into the applicable Principal Funding Account, on or
before the applicable Redemption Date, the aggregate Redemption Price of the
Notes to be redeemed, whereupon all such Notes shall be due and payable on the
Redemption Date.
SECTION 10.2 Form of Redemption Notice.
-------------------------
(a) Notice of redemption of any Notes under Section 10.1 shall
be given by the Indenture Trustee by first-class mail, postage prepaid, mailed
not less than five days prior to the applicable Redemption Date to each
Noteholder of record of the Notes to be redeemed at such Noteholder's address
appearing in the Note Register.
(b) All notices of redemption shall state:
(i) the applicable Redemption Date;
(ii) the applicable Redemption Price;
(iii) the place where the Notes are to be surrendered
for payment of the Redemption Price (which shall be the Agency Office
of the Indenture Trustee to be maintained as provided in Section 3.2);
(iv) the CUSIP number, if applicable; and
(v) the principal amount of Notes to be redeemed.
(c) Notice of redemption of the Notes shall be given by the
Indenture Trustee in the name and at the expense of the Issuer. Failure to give
notice of redemption, or any defect therein, to any Holder of any Note shall
not impair or affect the validity of the redemption of any other Note.
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SECTION 10.3 Notes Payable on Redemption Date.
--------------------------------
With respect to any Notes, such Notes shall, following notice
of redemption as required by Section 10.2 (in the case of redemption pursuant
to Section 10.1), on the applicable Redemption Date cease to be Outstanding for
purposes of this Indenture and shall thereafter represent only the right to
receive the applicable Redemption Price and (unless the Issuer shall default in
the payment of such Redemption Price) no interest shall accrue on such
Redemption Price for any period after the date to which accrued interest is
calculated for purposes of calculating such Redemption Price.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Compliance Certificates and Opinions, etc.
------------------------------------------
(a) Upon any application or request by the Issuer to the
Indenture Trustee to take any action under any provision of this Indenture, the
Issuer shall furnish to the Indenture Trustee upon request: (i) an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with, (ii) an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with and (iii) (if required by
the TIA) an Independent Certificate from a firm of certified public accountants
meeting the applicable requirements of this Section 11.1, except that, in the
case of any such application or request as to which the furnishing of such
documents is specifically required by any provision of this Indenture, no
additional certificate or opinion need be furnished. Every certificate or
opinion with respect to compliance with a condition or covenant provided for in
this Indenture shall include:
(i) a statement that each signatory of such
certificate or opinion has read or has caused to be read such covenant
or condition and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of
the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the judgment of each such
signatory, such signatory has made such examination or investigation
as is necessary to enable such signatory to express an informed
opinion as to whether or not such covenant or condition has been
complied with; and
(iv) a statement as to whether, in the opinion of
each such signatory, such condition or covenant has been complied
with.
(b) (i) Prior to the deposit with the Indenture Trustee of any
Collateral or other property or securities that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture,
the Issuer shall, in addition to any obligation imposed in Section 11.1(a) or
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elsewhere in this Indenture, furnish to the Indenture Trustee an Officers'
Certificate certifying or stating the opinion of each Person signing such
certificate as to the fair value (within 90 days of such deposit) to the Issuer
of the Collateral or other property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to
the Indenture Trustee an Officers' Certificate certifying or stating
the opinion of any signer thereof as to the matters described in
clause (b)(i) above, the Issuer shall also deliver to the Indenture
Trustee an Independent Certificate as to the same matters, if the fair
value to the Issuer of the 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 fiscal year of the Issuer,
as set forth in the certificates delivered pursuant to clause (i)
above and this clause (b)(ii), is 10% or more of the Outstanding
Amount of the Notes, 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 Officers' Certificate is less
than $25,000 or less than one percent of the outstanding Notes.
(iii) Other than with respect to the release of any
Defaulted Receivables, 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 signatory thereof as to the matters described in
clause (b)(iii) above, the Issuer shall also furnish to the Indenture
Trustee an Independent Certificate as to the same matters if the fair
value of the property or securities and of all other property, other
than Defaulted Receivables, or securities released from the lien of
this Indenture since the commencement of the then current calendar
year, as set forth in the certificates required by clause (b)(iii)
above and this clause (b)(iv), equals 10% or more of the Outstanding
Amount of the Notes, but such certificate need not be furnished in the
case of any release of property or securities if the fair value
thereof as set forth in the related Officer's Certificate is less than
$25,000 or less than one percent of the outstanding Notes.
(v) Notwithstanding Section 2.9 or any other
provision of this Section 11.1, the Issuer may (A) collect, liquidate,
sell or otherwise dispose of Receivables and related Collateral
Security and proceeds of both as and to the extent permitted or
required by the Basic Documents, (B) make cash payments out of the
Trust Accounts as and to the extent permitted or required by the Basic
Documents and (C) take any other action not inconsistent with the TIA
so long as the Indenture is or is required to be qualified under the
TIA.
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<PAGE>
SECTION 11.2 Form of Documents Delivered to Indenture Trustee.
------------------------------------------------
(a) In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it is not
necessary that all such matters be certified by, or covered by the opinion of,
only one such Person, or that they be so certified or covered by only one
document, but one such Person may certify or give an opinion with respect to
some matters and one or more other such Persons as to other matters, and any
such Person may certify or give an opinion as to such matters in one or several
documents.
(b) Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer
or Opinion of Counsel may be based, insofar as it relates to factual matters,
upon a certificate or opinion of, or representations by, an officer or officers
of the Servicer, the Transferor, the Issuer or the Administrator, stating that
the information with respect to such factual matters is in the possession of
the Servicer, the Transferor, the Issuer or the Administrator, unless such
counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.
(c) Where any Person is required to make, give or execute two
or more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
(d) Whenever in this Indenture, in connection with any
application or certificate or report to the Indenture Trustee, it is provided
that the Issuer shall deliver any document as a condition of the granting of
such application, or as evidence of the Issuer's compliance with any term
hereof, it is intended that the truth and accuracy, at the time of the granting
of such application or at the effective date of such certificate or report (as
the case may be), of the facts and opinions stated in such document shall in
such case be conditions precedent to the right of the Issuer to have such
application granted or to the sufficiency of such certificate or report. The
foregoing shall not, however, be construed to affect the Indenture Trustee's
right to rely upon the truth and accuracy of any statement or opinion contained
in any such document as provided in Article VI.
SECTION 11.3 Acts of Noteholders.
-------------------
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Noteholders or a Series of Noteholders may be embodied in and evidenced by
one or more instruments of substantially similar tenor signed by such
Noteholders in person or by agents duly appointed in writing and shall be
subject to Section 5.11 hereof; and except as herein otherwise expressly
provided such action shall become effective when such instrument
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<PAGE>
or instruments are delivered to the Indenture Trustee, and, where it is hereby
expressly required, to the Issuer. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Noteholders signing such instrument or instruments. Proof
of execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section
6.1) conclusive in favor of the Indenture Trustee and the Issuer, if made in
the manner provided in this Section 11.3.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any manner that the Indenture
Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note
Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Notes (or any one or more
Predecessor Notes) shall bind the Holder of every Note issued upon the
registration thereof or in exchange therefor or in lieu thereof, in respect of
anything done, omitted or suffered to be done by the Indenture Trustee or the
Issuer in reliance thereon, whether or not notation of such action is made upon
such Note.
SECTION 11.4 Notices, etc., to Indenture Trustee, Issuer and
Rating Agencies. Any request, demand, authorization, direction, notice,
consent, waiver or Act of Noteholders or other documents provided or permitted
by this Indenture to be made upon, given or furnished to or filed with:
(a) the Indenture Trustee by any Noteholder or by the Issuer
shall be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Indenture Trustee at its Corporate Trust
Office, or
(b) the Issuer by the Indenture Trustee or by any Noteholder
shall be sufficient for every purpose hereunder if in writing and either sent
by electronic facsimile transmission (with hard copy to follow via first class
mail) or mailed, by certified mail, return receipt requested, or by overnight
mail to the Issuer and the Owner Trustee each at the address specified in
Appendix B to the Trust Sale and Servicing Agreement.
The Issuer shall promptly transmit any notice received by it
from the Noteholders to the Indenture Trustee and the Indenture Trustee shall
likewise promptly transmit any notice received by it from the Noteholders to
the Issuer.
(c) Notices required to be given to the Rating Agencies by the
Issuer, the Indenture Trustee or the Owner Trustee shall be delivered as
specified in Appendix B to the Trust Sale and Servicing Agreement.
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<PAGE>
SECTION 11.5 Notices to Noteholders; Waiver.
------------------------------
(a) Where this Indenture provides for notice to Noteholders of
any condition or event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if it is in writing and mailed,
first-class, postage prepaid to each Noteholder affected by such event, at such
Person's address as it appears on the Note Register, not later than the latest
date, and not earlier than the earliest date, prescribed for the giving of such
notice. If notice to Noteholders is given by mail, neither the failure to mail
such notice nor any defect in any notice so mailed to any particular Noteholder
shall affect the sufficiency of such notice with respect to other Noteholders,
and any notice that is mailed in the manner herein provided shall conclusively
be presumed to have been duly given regardless of whether such notice is in
fact actually received.
(b) Where this Indenture provides for notice in any manner,
such notice may be waived in writing by any Person entitled to receive such
notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Noteholders shall be filed with
the Indenture Trustee but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such a waiver.
(c) In case, by reason of the suspension of regular mail
service as a result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event of Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Indenture Trustee
shall be deemed to be a sufficient giving of such notice.
(d) Where this Indenture provides for notice to the Rating
Agencies, failure to give such notice shall not affect any other rights or
obligations created hereunder, and shall not under any circumstance constitute
an Event of Default.
SECTION 11.6 Alternate Payment and Notice Provisions.
---------------------------------------
Notwithstanding any provision of this Indenture or any of the
Notes to the contrary, the Issuer may enter into any agreement with any Holder
of a Note providing for a method of payment, or notice by the Indenture Trustee
or any Paying Agent to such Holder, that is different from the methods provided
for in this Indenture for such payments or notices. The Issuer shall furnish to
the Indenture Trustee a copy of each such agreement and the Indenture Trustee
shall cause payments to be made and notices to be given in accordance with such
agreements.
SECTION 11.7 Conflict with Trust Indenture Act.
---------------------------------
(a) If any provision hereof limits, qualifies or conflicts
with another provision hereof that is required to be included in this Indenture
by any of the provisions of the TIA, such required provision shall control.
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<PAGE>
(b) If this Indenture is or is required to be qualified under
the TIA, the provisions of TIA ss.ss. 310 through 317 that impose duties on any
Person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
SECTION 11.8 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 11.9 Successors and Assigns.
----------------------
(a) All covenants and agreements in this Indenture and the
Notes by the Issuer shall bind its successors and assigns, whether so expressed
or not.
(b) All covenants and agreements of the Indenture Trustee in
this Indenture shall bind its successors and assigns, whether so expressed or
not.
SECTION 11.10 Separability.
------------
In case any provision in this Indenture or in the Notes shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
SECTION 11.11 Benefits of Indenture.
----------------------
Nothing in this Indenture or in the Notes, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, the Noteholders and the Note Owners and (only to the extent
expressly provided herein) the Certificateholders and the Certificate Owners
and any other party secured hereunder, and any other Person with an ownership
interest in any part of the Trust Estate, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 11.12 Legal Holidays.
---------------
If the date on which any payment is due shall not be a
Business Day, then (notwithstanding any other provision of the Notes or this
Indenture) payment need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date
on which nominally due, and no interest shall accrue for the period from and
after any such nominal date.
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<PAGE>
SECTION 11.13 GOVERNING LAW.
-------------
THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS OR ANY OTHER JURISDICTION'S
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.14 Counterparts.
------------
This Indenture may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
SECTION 11.15 Recording of Indenture.
-----------------------
If this Indenture is subject to recording in any appropriate
public recording offices, such recording is to be effected by the Issuer and at
its expense accompanied by an Opinion of Counsel (which may be counsel to the
Indenture Trustee or any other counsel reasonably acceptable to the Indenture
Trustee) to the effect that such recording is necessary either for the
protection of the Noteholders or any other Person secured hereunder or for the
enforcement of any right or remedy granted to the Indenture Trustee under this
Indenture.
SECTION 11.16 No Recourse.
------------
(a) Each Noteholder will agree by acceptance of a Note (or
interest therein) that no recourse may be taken, directly or indirectly, with
respect to the obligations of the Issuer, the Owner Trustee or the Indenture
Trustee on the Notes or under this Indenture or any certificate or other
writing delivered in connection herewith or therewith, against:
(i) the Indenture Trustee or the Owner Trustee
in its individual capacity;
(ii) any owner of a beneficial interest in the
Issuer; or
(iii) any partner, owner, beneficiary, agent,
officer, director 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 (it being understood that the Indenture Trustee and
the Owner Trustee has no such obligation in its 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
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<PAGE>
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 IV, V and VI of the Trust Agreement.
(b) Except as expressly provided in the Basic Documents,
neither the Transferor, the Servicer, the Indenture Trustee nor the Owner
Trustee in their respective individual capacities, any owner of a beneficial
interest in the Issuer, nor any of their respective partners, owners,
beneficiaries, agents, officers, directors, employees or successors or assigns,
shall be personally liable for, nor shall recourse be had to any of them for,
the payment of principal of or interest on, or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in the
Notes or this Indenture, it being expressly understood that said covenants,
obligations and indemnifications have been made by the Owner Trustee solely as
the Owner Trustee in the assets of the Issuer. Each Noteholder or Note Owner by
the acceptance of a Note (or beneficial interest therein) will agree that,
except as expressly provided in the Basic Documents, in the case of an Event of
Default under this Indenture, the Holder shall have no claim against any of the
foregoing for any deficiency, loss or claim therefrom; provided, however, that
nothing contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in this Indenture or in the Notes.
SECTION 11.17 No Petition.
------------
The Indenture Trustee, by entering into this Indenture, and
each Noteholder and Note Owner, by accepting a Note (or interest therein)
issued hereunder, hereby covenant and agree that they shall not, prior to the
date which is one year and one day after the termination of the Trust
Agreement, acquiesce, petition or otherwise invoke or cause the Transferor or
the Issuer to invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against the Transferor or the Issuer
under any Insolvency Law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Transferor or
the Issuer or any substantial part of its property, or ordering the winding up
or liquidation of the affairs of the Transferor or the Issuer.
SECTION 11.18 Inspection.
----------
The Issuer agrees that, on reasonable prior notice, it shall
permit any representative of the Indenture Trustee, during the Issuer's normal
business hours, to examine all the books of account, records, reports and other
papers of the Issuer, to make copies and extracts therefrom, to cause such
books to be audited by Independent certified public accountants, and to discuss
the Issuer's affairs, finances and accounts with the Issuer's officers,
employees and Independent certified public accountants, all at such reasonable
times and as often as may be reasonably requested. The Indenture Trustee shall
and shall cause its representatives to hold in confidence all such information
except to the extent disclosure may be required by law (and all reasonable
applications for confidential treatment are unavailing) and except to the
extent that the Indenture Trustee may reasonably determine that such disclosure
is consistent with its obligations hereunder.
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SECTION 11.19 No Substantive Review of Compliance Documents.
---------------------------------------------
Other than as specifically set forth in this Indenture for
notices which specifically contain information of which the Indenture Trustee
is to have notice, any reports, information or other documents provided to the
Indenture Trustee are for the purposes only of enabling the sending party to
comply with its document delivery requirements hereunder and such party's
receipt of any such information shall not, in and of itself, constitute
constructive or actual notice to the Indenture Trustee of any information
contained therein or determinable from any information contained therein,
including the Issuer or the Servicer's compliance with any of its covenants,
representations or warranties hereunder.
SECTION 11.20 Amendment of Basic Documents.
-----------------------------
The Issuer shall not amend, modify or grant any consent or
waiver with respect to the provisions of any of the Basic Documents without the
prior written consent of the Indenture Trustee, except where the Basic
Documents do not require the consent of the Indenture Trustee for such
amendment, modification, consent or waiver.
SECTION 11.21 Effect of Amendment and Restatement.
------------------------------------
It is the intent of the parties hereto that this Indenture, as
amended and restated as of __________, 2000, shall as of such date, replace in
its entirety the Original Indenture; provided that, with respect to the period
of time from November 22, 1999 through __________, 2000, the rights and
obligations of the parties shall be governed by the Original Indenture;
provided further, that the amendment and restatement of the Original Indenture
shall not effect any of the grants, transfers or conveyances contemplated by
the Original Indenture to have occurred prior to __________, 2000.
* * * * *
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<PAGE>
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have
caused this Amended and Restated Indenture to be duly executed by their
respective officers, thereunto duly authorized, all as of the day and year
first above written.
WORLD OMNI MASTER OWNER TRUST
By: Chase Manhattan Bank Delaware, not in its
individual capacity but solely as Owner Trustee
By:________________________________________
Name:
Title:
HARRIS TRUST AND SAVINGS BANK
as Indenture Trustee
By:________________________________________
Name: E. Kay Liederman Van Dam
Title: Vice President
Acknowledged and Accepted:
WORLD OMNI FINANCIAL CORP.,
Servicer
By:_____________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
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<PAGE>
EXHIBIT A
FORM OF TRANSFER CERTIFICATE
WODFI LLC
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
Harris Trust and Savings Bank
311 West Monroe St. 12th Floor
Chicago, Illinois 60606
Attn: Indenture Trustee Administration
as Indenture Trustee for
World Omni Master Owner Trust
Ladies and Gentlemen:
In connection with the purchase of a Note subject to Section
2.15 of the Amended and Restated Indenture dated as of __________, 2000 (the
"Unregistered Note") of the World Omni Master Owner Trust, the undersigned
buyer ("Buyer") hereby acknowledges, represents and agrees that:
(a) The Buyer has received the [describe offering document]
relating to the offering of the Unregistered Note (including exhibits thereto).
(b) The Buyer understands that the Unregistered Note has not
been registered under the Securities Act of 1933, as amended (the "Securities
Act"), and may not be sold except as permitted in the following sentence. The
Buyer agrees, on its own behalf and on behalf of any accounts for which it is
acting as hereinafter stated, that such Unregistered Note may be resold,
pledged or transferred only (i) to an [institutional] investor that is an
"Accredited Investor" as defined in Rule 501(a)(1),(2),(3) or (7) (an
"Institutional Accredited Investor") under the Securities Act acting for its
own account (and not for the account of others) or as a fiduciary or agent for
others (which others also are Institutional Accredited Investors unless the
holder is a bank acting in its fiduciary capacity) that, if so requested by the
Transferor or the Indenture Trustee, executes a certificate in the form hereof,
(ii) [so long as such Unregistered Note is eligible for resale pursuant to Rule
144A under the Securities Act ("Rule 144A"), to a person whom the Buyer
reasonably believes after due inquiry to be a "qualified institutional buyer"
(as defined in Rule 144A) acting for its own account (and not for the account
of others) or as a fiduciary or agent for others (which others also are
"qualified institutional buyers") that, if so requested by the Transferor or
the Indenture Trustee, executes a certificate in the form
A-1
<PAGE>
hereof or (iii)] in a sale, pledge or other transfer made in a transaction
otherwise exempt from the registration requirements of the Securities Act, in
which case (A) the Indenture Trustee shall require that both the prospective
transferor and the prospective transferee certify to the Indenture Trustee and
the Transferor in writing the facts surrounding such transfer, which
certification shall be in form and substance satisfactory to the Indenture
Trustee and the Transferor, and (B) the Indenture Trustee shall require a
written opinion of counsel (which will not be at the expense of the Transferor,
the Servicer or the Indenture Trustee) satisfactory to the Transferor and the
Indenture Trustee to the effect that such transfer will not violate the
Securities Act, in each case in accordance with any applicable securities laws
of any state of the United States. The Buyer will notify any purchaser of the
Unregistered Note from it of the above resale restrictions, if then applicable.
The Buyer further understands that in connection with any transfer of the
Unregistered Note by it that the Transferor and the Indenture Trustee may
request, and if so requested the Buyer will furnish, such certificates and
other information as they may reasonably require to confirm that any such
transfer complies with the foregoing restrictions.
<TABLE>
<CAPTION>
CHECK [ONE]
<S> <C>
[ ] (1) The Buyer is an [institutional investor and] an "accredited investor" (as
defined in Rule 501(a)(1),(2),(3) or (7) of Regulation D under the Securities Act)
acting for its own account (and not for the account of others) or as a fiduciary or
agent for others (which others also are Institutional Accredited Investors unless the
Buyer is a bank acting in its fiduciary capacity). The Buyer has such knowledge
and experience in financial and business matters as to be capable of evaluating the
merits and risks of its investment in the Unregistered Note, and the Buyer and any
accounts for which it is acting are able to bear the economic risk of investment in
the Unregistered Note for an indefinite period of time. The Buyer is acquiring the
Unregistered Note for investment and not with a view to, or for offer and sale in
connection with, a public distribution.
[[ ] (2) The Buyer is a "qualified institutional buyer" as defined under
Rule 144A under the Securities Act and is acquiring the Unregistered Note
for its own account (and not for the account of others) or as a fiduciary or
agent for others (which others also are "qualified institutional buyers").
The Buyer is are familiar with Rule 144A under the Securities Act and is
aware that the transferor of the Unregistered Note and other parties
intend to rely on the statements made herein and the exemption from the
registration requirements of the Securities Act provided by Rule 144A.]
</TABLE>
A-2
<PAGE>
(c) You are entitled to rely upon this letter and you 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.
-------------------------------------------
Print Name of Buyer
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
Date: _____________________________________
A-3
<PAGE>
EXHIBIT B
UNDERTAKING LETTER
WODFI LLC
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
Harris Trust and Savings Bank
311 West Monroe St., 12th Floor
Chicago, IL 60606
Attn: Indenture Trust Administration
as Indenture Trustee for
World Omni Master Owner Trust
Ladies and Gentlemen:
In connection with our purchase of record or beneficial
ownership of a Note subject to the provisions of Section 2.15 of the Amended
and Restated Indenture dated as of __________, 2000 (the "Unregistered Note")
of the World Omni Master Owner Trust, the undersigned purchaser, record owner
or beneficial owner hereby acknowledges, represents and warrants that such
purchaser, record owner or beneficial owner:
(1) is not, and has not acquired the Unregistered Note by or
for the benefit of, (i) an employee benefit plan (as defined in Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA")) that
is subject to the provisions of Title I of ERISA, (ii) a plan described in
Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended, or [(iii)
any entity whose underlying assets include plan assets by reason of a plan's
investment in such entity]; and
B-1
<PAGE>
(2) acknowledges that you and others will rely on our
acknowledgments, representations and warranties, and agrees to notify you
promptly in writing if any of our acknowledgments, representations or
warranties herein cease to be accurate and complete.
-------------------------------------------
Name of Note Owner
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
Date: _____________________________________
B-2
K&E DRAFT 3/3/00
================================================================================
SERIES 200_-_ SUPPLEMENT
Dated as of ____________, 2000
to
INDENTURE
WORLD OMNI MASTER OWNER TRUST
as Issuer
and
HARRIS TRUST AND SAVINGS BANK,
as Indenture Trustee
---------------------------------
WORLD OMNI MASTER OWNER TRUST
SERIES 200_-_ NOTES
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE I
DEFINITIONS.....................................................................................1
ARTICLE II
CREATION OF THE SERIES 200_-_ NOTES............................................................12
SECTION 2.01. Designation..................................................................12
ARTICLE III
SERVICING FEE..................................................................................12
SECTION 3.01. Servicing Compensation.......................................................12
ARTICLE IV
RIGHTS OF SERIES 200_-_ NOTEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS......................................................13
SECTION 4.01. Daily Allocations; Payments to Certificateholders............................13
SECTION 4.02. Monthly Interest.............................................................15
SECTION 4.03. Establishment of the Series 200_-_ Accounts..................................16
SECTION 4.04. Application of Noteholder Non-Principal Collections,
Investment Proceeds and Available Noteholder
Principal Collections.......................................................18
SECTION 4.05. Distributions to Series 200_-_ Noteholders...................................19
SECTION 4.06. Application of Reserve Fund and Available
Subordinated Amount..........................................................20
SECTION 4.07. Noteholder Charge-Offs.......................................................21
SECTION 4.08. Excess Principal Collections.................................................22
SECTION 4.09. Accumulation Period Length; Accumulation Period
Commencement Date............................................................22
SECTION 4.10. Excess Funding Account.......................................................22
ARTICLE V
DISTRIBUTIONS AND REPORTS
TO SERIES 200_-_ NOTEHOLDERS...................................................................23
SECTION 5.01. Distributions................................................................23
SECTION 5.02. Reports and Statements to Series 200_-_ Noteholders..........................24
i
<PAGE>
ARTICLE VI
EARLY AMORTIZATION EVENTS......................................................................26
SECTION 6.01. Additional Early Amortization Events.........................................26
SECTION 6.02 Recommencement of the Revolving Period.......................................27
ARTICLE VII
OPTIONAL REDEMPTION............................................................................27
SECTION 7.01. Optional Redemption..........................................................27
ARTICLE VIII
FINAL DISTRIBUTIONS............................................................................28
SECTION 8.01. Acquisition of Notes Pursuant to Section 10.1 of the
Indenture....................................................................28
SECTION 8.02. Disposition of Principal Receivables Pursuant to
Section 5.4 of the Indenture.................................................28
ARTICLE IX
MISCELLANEOUS PROVISIONS.......................................................................30
SECTION 9.01. Ratification of Agreement....................................................30
SECTION 9.02. Counterparts.................................................................30
SECTION 9.03. Change in Indenture Trustee..................................................30
SECTION 9.04. GOVERNING LAW................................................................30
EXHIBITS
Exhibit A Form of Series 200_-_, Class A Note
Exhibit B Form of Series 200_-_, Class B Note
Exhibit C Form of Monthly Payment Date Statement
SCHEDULES
Schedule 1 Series 200_-_ Accounts
ii
</TABLE>
<PAGE>
THIS SERIES SUPPLEMENT, dated as of ______________, 2000 (as amended,
supplemented or otherwise modified, this "Series Supplement") to the Indenture
dated as of November 22, 1999 (as amended, supplemented or otherwise modified,
the "Indenture"), among World Omni Master Owner Trust (the "Issuer" or the
"Trust") and Harris Trust and Savings Bank, as Indenture Trustee (as indenture
trustee and not in its individual capacity, the "Indenture Trustee").
Section 2.1 of the Indenture provides that the Issuer may from time to
time issue one or more new Series of Notes. The Principal Terms of any new
Series of Notes are to be set forth in a Series Supplement. Pursuant to this
Series Supplement, the Issuer and the Indenture Trustee shall create the Series
200_-_ Notes and specify the Principal Terms thereof. The Servicer is
acknowledging this Series Supplement to agree to the terms hereof applicable to
the Servicer.
ARTICLE I
DEFINITIONS
(a) Whenever used in this Series Supplement, the following words shall
have the following meanings:
"Accumulation Period" means a period beginning at the close of business
on the Accumulation Period Commencement Date and ending on the close of business
of the earliest of (a) the date an Early Amortization Period commences and (b)
the date the outstanding principal amount of the Series 200_-_ Notes is paid in
full.
"Accumulation Period Commencement Date" shall mean the first day of the
Collection Period when the number of full Collection Periods remaining until the
Expected Principal Payment Date first equals the Accumulation Period Length
adjusted pursuant to Section 4.09 and shall not thereafter be changed; provided,
however, that, if at any time after the [ ] Payment Date, any other outstanding
Series (other than any Excluded Series) shall have entered into a investment
period or an early amortization period, the Accumulation Period Commencement
Date shall be the earlier of (i) the date that such outstanding Series shall
have entered into its investment period or early amortization period and (ii)
the Accumulation Period Commencement Date as previously determined.
"Accumulation Period Length" shall mean, on any date of determination,
a period calculated as of the [ ] Payment Date and each Payment Date thereafter
that occurs prior to the Accumulation Period Commencement Date, as the lesser of
(i) the number of full Collection Periods between such Payment Date and the
Expected Principal Payment Date and (ii) the product, rounded upwards to the
nearest integer not greater than three, of (a) one divided by the lowest Monthly
Payment Rate during the last 12 months and (b) a fraction, the numerator of
which is the sum of (i) the Invested Amount as of such Payment Date (after
giving effect to all changes therein on such date) and (ii) the invested amounts
of all other Series (other than any Excluded
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Series) currently in their amortization or accumulation periods or expected to
be in their amortization periods by the Expected Principal Payment Date and the
denominator of which is the sum of such Invested Amount and the invested amounts
as of such Payment Date (after giving effect to all changes therein on such
date) of all other outstanding Series (other than any Excluded Series) which are
scheduled to be outstanding on the Expected Principal Payment Date.
"Additional Noteholder Collections" shall mean, with respect to any
Deposit Date, the sum of (a) the Additional Noteholder Non-Principal Collections
for such Deposit Date and (b) the Additional Noteholder Principal Collections
for such Deposit Date.
"Additional Noteholder Non-Principal Collections" shall mean, for any
Deposit Date, an amount equal to the product of (a) the excess of (i) the
Certificateholder Percentage for such date over (ii) the Excess
Certificateholder Percentage for such Deposit Date and (b) Allocable Non-
Principal Collections for such Deposit Date; provided, however, that the
Additional Noteholder Non-Principal Collections shall be zero for any Deposit
Date on which the Available Subordinated Amount is zero.
"Additional Noteholder Principal Collections" shall mean, for any
Deposit Date, an amount equal to the product of (a) the excess of (i) the
Certificateholder Percentage for such Deposit Date over (ii) the Excess
Certificateholder Percentage for such date and (b) Allocable Principal
Collections for such Deposit Date; provided, however, that the Additional
Noteholder Principal Collections shall be zero for any Deposit Date on which the
Available Subordinated Amount is zero.
"Advance Date" means [ ], 2000.
"Allocable Non-Principal Collections" shall mean, with respect to any
day, the product of (a) the Series 200_-_ Allocation Percentage on such day and
(b) the aggregate amount of Collections of Non-Principal Receivables deposited
in the Collection Account for such day.
"Allocable Principal Collections" shall mean, with respect to any day,
the product of (a) the Series 200_-_ Allocation Percentage on such day and (b)
the aggregate amount of Collections in respect of Principal Receivables
deposited in the Collection Account for such day.
["Assets Receivables Rate" shall mean, with respect to any Interest
Period an amount equal to the product of: (a) the quotient obtained by dividing
(i) 360 by (ii) the actual number of days elapsed in such period and (b) a
fraction, (i) the numerator of which is the sum of (A) Noteholder Non-Principal
Collections for the Collection Period immediately preceding the last day of such
period (which for this purpose only is based on interest amounts billed to the
Dealers which are due during such Collection Period) less the Monthly Servicing
Fee with respect to such immediately preceding Collection Period, to the extent
not waived by the Servicer and (B) the Investment Proceeds to be applied on the
Payment Date related to such period and (ii) the denominator of which is the sum
of (A) the product of the Floating Allocation Percentage, the Series Allocation
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Percentage and the average Pool Balance (after giving effect to any charge-offs)
for such immediately preceding Collection Period, (B) the principal balance on
deposit in the Excess Funding Account on the first day of such period (after
giving effect to all deposits to and withdrawals therefrom on such first day),
and (C) the principal balance on deposit in the Principal Funding Account on the
first day of such period (after giving effect to all deposits to and withdrawals
therefrom on such first day).]
"Available Noteholder Principal Collections" shall mean, with respect
to any Deposit Date falling in the Accumulation Period or an Early Amortization
Period, the sum of (a) Noteholder Principal Collections for such Deposit Date,
(b) Series 200_-_ Excess Principal Collections to cover any Principal Shortfall
for such Deposit Date, (c) any funds transferred from the Excess Funding Account
to the Principal Funding Account on such Deposit Date, and (d) on the Class A
Stated Maturity Date or the Class B Stated Maturity Date, funds in the Reserve
Fund to the extent of any outstanding Class A Carry-over Amount, in the case of
the Class A Stated Maturity Date, or Class B Carry-over Amount, in the case of
the Class B Stated Maturity Date (in either event, after giving effect to the
distributions to be made on such date).
"Available Subordinated Amount" means, on the Series Issuance Date, the
Required Subordinated Amount and, on any subsequent day, an amount equal to the
lesser of (x) the Required Subordinated Amount for that day and (y) the
Available Subordinated Amount for the most recent Reset Date, minus (A) the
Required Draw Amount with respect to any Payment Date occurring after that Reset
Date, plus (B) the amount of Noteholder Non-Principal Collections and Investment
Proceeds distributed to the Certificateholders in respect of Noteholder Default
Amounts and Monthly Dilution Amounts that had previously reduced the Available
Subordinated Amount since the most recent Reset Date, minus (C) the Incremental
Subordinated Amount for the most recent Reset Date, plus (D) the Incremental
Subordinated Amount for such date of determination, plus (E) the Subordinated
Percentage of the decrease in the Series Allocable Excess Funding Amount since
the most recent Reset Date, minus (F) the Subordinated Percentage of the
increase in the Series 200_-_ Excess Funding Amount since the most recent Reset
Date; provided, that the Certificateholders may, in their sole discretion, from
time to time increase the Available Subordinated Amount for so long as the
cumulative amount of such increase does not exceed the lesser of $________ or
__% of the Invested Amount.
["Calculation Agent" shall mean the Indenture Trustee or any other
Calculation Agent selected by the Seller which is reasonably acceptable to the
Indenture Trustee.]
["Carry-over Amount" shall mean the sum of the Class A Carry-over
Amount and the Class B Carry-over Amount.]
"Certificateholder Percentage" shall mean 100% minus (a) the Floating
Allocation Percentage, when used with respect to Non-Principal Collections and
Defaulted Receivables and Principal Collections during any Revolving Period, and
(b) the Principal Allocation Percentage,
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when used with respect to Principal Collections during the Accumulation Period
and during any Early Amortization Period.
"Class A Carry-over Amount" shall mean, if the Class A Note Rate for
any Payment Date is based on the Assets Receivables Rate, the sum of (a) the
excess of (i) the amount of interest on the Class A Notes that would have
accrued in respect of the related Interest Period had interest on the Class A
Notes been calculated based on LIBOR over (ii) the amount of interest on the
Class A Notes actually accrued in respect of such Interest Period based on the
Assets Receivables Rate and (b) the unpaid portion of any such excess from prior
Payment Dates and interest accrued thereon calculated on the basis of LIBOR.
"Class A Controlled Accumulation Amount" shall mean an amount equal to
the aggregate outstanding principal balance of the Class A Notes as of the
Payment Date immediately preceding the first date of the Accumulation Period
(after giving effect to any changes therein on such date) divided by the
Accumulation Period Length.
"Class A Controlled Deposit Amount" shall mean, for a Deposit Date (i)
during the Accumulation Period, the excess, if any, of (a) the product of the
Class A Controlled Accumulation Amount and the number of Payment Dates from and
including the first Payment Date with respect to the Accumulation Period through
and including the Payment Date related to the Collection Period during which the
Deposit Date occurs (but not in excess of the Accumulation Period Length) over
(b) the amount on deposit in the Principal Funding Account before giving effect
to any withdrawals from or deposits to such account on such Deposit Date and
(ii) during an Early Amortization Period, the Class A Invested Amount.
"Class A Initial Invested Amount" means $_____________.
"Class A Invested Amount" shall mean, for any date, an amount equal to
the Class A Initial Invested Amount minus the amount, without duplication, of
principal payments made to Class A Noteholders or deposited to the Principal
Funding Account in respect of the Class A Notes prior to such date since the
Series Issuance Date, minus the excess, if any, of the aggregate amount of Class
A Noteholder Charge-Offs for all Payment Dates preceding such date, over the
aggregate amount of any reversals of Class A Noteholder Charge-Offs for all
Payment Dates preceding such date, minus the Series 200_-_ Excess Funding Amount
for such day but limited to an amount that would reduce the Class A Invested
Amount to zero.
"Class A Monthly Interest" shall have the meaning specified in Section
4.02.
"Class A Note Rate" will be equal to [___% per annum][the lesser of (a)
LIBOR plus ____% and (b) the Assets Receivables Rate for the related Payment
Date].
"Class A Noteholder Charge-offs" shall have the meaning specified in
Section 4.07.
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"Class A Stated Maturity Date" shall mean [ ], 200[ ].
"Class B Carry-over Amount" shall mean, if the Class B Note Rate for
any Payment Date is based on the Assets Receivables Rate, the sum of (a) the
excess of (i) the amount of interest on the Class B Notes that would have
accrued in respect of the related Interest Period had interest on the Class B
Notes been calculated based on LIBOR over (ii) the amount of interest on the
Class B Notes actually accrued in respect of such Interest Period based on the
Assets Receivables Rate and (b) the unpaid portion of any such excess from prior
Payment Dates and interest accrued thereon calculated on the basis of LIBOR.
"Class B Controlled Accumulation Amount" shall mean an amount equal to
the quotient of (a) the aggregate outstanding principal balance of the Class B
Notes as of the Payment Date immediately preceding the first day of the
Accumulation Period (after giving effect to any changes therein on such date)
divided by (b) the Accumulation Period Length.
"Class B Controlled Deposit Amount" shall mean, for a Deposit Date (i)
during the Accumulation Period, the excess, if any, of (a) the product of the
Class B Controlled Accumulation Amount and the number of Payment Dates from and
including the first Payment Date with respect to the Accumulation Period through
and including the Payment Date related to the Collection Period during which the
Deposit Date occurs (but not in excess of the Accumulation Period Length) over
(b) the amount on deposit in the Principal Funding Account before giving effect
to any withdrawals from or deposits to such account on such Deposit Date and
(ii) during an Early Amortization Period, the Class B Invested Amount.
"Class B Initial Invested Amount" means $__________.
"Class B Invested Amount" shall mean, for any date, an amount equal to
the Class B Initial Invested Amount minus the amount, without duplication, of
principal payments made to Class B Noteholders or deposited to the Principal
Funding Account in respect of the Class B Notes prior to such date since the
Series Issuance Date minus the excess, if any, of aggregate amount of Class B
Noteholder Charge-Offs for all Payment Dates preceding such date, over the
aggregate amount of any reversals of Class B Noteholder Charge-Offs for all
Payment Dates preceding such date minus the amount, if any, of the Series 2000-1
Excess Funding Amount remaining after allocation to the Class A Invested Amount
but limited to an amount that would reduce the Class B Invested Amount to zero.
"Class B Monthly Interest" shall have the meaning specified in Section
4.02.
"Class B Note Rate" shall mean [___% per annum][the lesser of (a) LIBOR
plus ____% and (b) the Assets Receivables Rate for the related Payment Date].
"Class B Noteholder Charge-offs" shall have the meaning specified in
Section 4.07.
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"Class B Stated Maturity Date" shall mean [ ], 200[ ]
"Deficiency Amount" shall have the meaning specified in Section
4.06(b).
"Excess Certificateholder Percentage" shall mean, for any day, a
percentage (which percentage shall never be less than 0% nor more than 100%)
equal to (a) 100% minus, when used with respect to Non-Principal Collections and
Defaulted Receivables at all times and Principal Collections during any
Revolving Period, the sum of (i) the Floating Allocation Percentage with respect
to such day and (ii) the percentage equivalent of a fraction, the numerator of
which is the Available Subordinated Amount as of the most recent Reset Date and
the denominator of which is the product of (A) the Pool Balance as of the most
recent Reset Date and (B) the Series 200_-_ Allocation Percentage for such day
or (b) 100% minus, when used with respect to Principal Collections during the
Accumulation Period and any Early Amortization Period, the sum of (i) the
Principal Allocation Percentage with respect to such day and (ii) the percentage
equivalent of a fraction, the numerator of which is the Available Subordinated
Amount as of the most recent Reset Date and the denominator of which is the
product of (A) the Pool Balance as of the most recent Reset Date and (B) the
Series 200_-_ Allocation Percentage for such day.
"Excess Reserve Fund Required Amount" shall mean, for any Payment Date,
an amount equal to the greater of (a) 5% of the initial principal balance of the
Series 200_-_ Notes at the end of the Revolving Period and (b) the excess of (i)
the Available Subordinated Amount on the most recent Reset Date (after giving
effect to the allocations, distributions, withdrawals and deposits to be made on
such Payment Date) over (ii) the excess of (x) the Series 200_-_ Allocation
Percentage of the Pool Balance on the most resent Reset Date over (y) the
Invested Amount on such Payment Date (after giving effect to changes therein on
such Payment Date); provided, that the Excess Reserve Fund Required Amount shall
not exceed the Available Subordinated Amount on the most recent Reset Date.
"Expected Principal Payment Date" shall mean the _________ Payment Date.
"Floating Allocation Percentage" shall mean, with respect to any day,
the percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Invested Amount as of the most recent
Reset Date and the denominator of which is the product of (a) the Pool Balance
as of such Reset Date and (b) the Series 200_-_ Allocation Percentage for such
day; provided, however, that, with respect to the first Reset Date, the Floating
Allocation Percentage shall mean the percentage equivalent of a fraction, the
numerator of which is the Initial Invested Amount and the denominator of which
is the product of (x) the Pool Balance on the Series Cut-Off Date and (y) the
Series 200_-_ Allocation Percentage with respect to the Series Cut-Off Date.
"Fully Funded Date" shall mean, the date on which the amount on deposit
in the Principal Funding Account with respect to the Series 200_-_ Notes equals
the outstanding principal amount of the Series 200_-_ Notes.
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"Incremental Subordinated Amount" shall mean, for any day, the product
of (a) a fraction, the numerator of which is the sum of the Target Invested
Amount and the Target Available Subordinated Amount and the denominator of which
is the greater of (i) the Pool Balance or (ii) the amount calculated as the
numerator above for each outstanding series and (b) the Trust Incremental
Subordinated Amount, in each case, on the most recent Reset Date.
"Initial Invested Amount" means the sum of the Class A Initial Invested
Amount and (b) the Class B Initial Invested Amount.
"Initial Payment Date" shall mean [________ __, 2000].
"Initial Reserve Fund Deposit Amount" shall mean $[ ].
"Interest Period" shall mean, with respect to any Payment Date, the
period from and including the Payment Date immediately preceding such Payment
Date (or, in the case of the Initial Payment Date, the [Series Issuance Date])
to but excluding such Payment Date.
"Invested Amount" shall mean, for any day, an amount equal to the sum
of (a) the Class A Invested Amount and (b) the Class B Invested Amount.
"Investment Proceeds" shall mean, with respect to any Payment Date, all
interest and other investment earnings (net of losses and investment expenses)
deposited into the Collection Account on the related Determination Date with
respect to (a) funds on deposit in the Reserve Fund and the Principal Funding
Account, (b) the Series 200_-_ Allocation Percentage of funds held in the
Collection Account and (c) the Series 200_-_ Allocation Percentage of funds held
in the Excess Funding Account.
["LIBOR" shall mean, with respect to any Interest Period, an amount
established by the Calculation Agent and equal to the offered rate for United
States dollar deposits for one month that appears on Telerate Page 3750 as of
11:00 A.M., London time, on the LIBOR Determination Date. If on any LIBOR
Determination Date the offered rate does not appear on Telerate Page 3750, the
Calculation Agent will request each of the reference banks (which shall be major
banks that are engaged in transactions in the London interbank market selected
by the Calculation Agent) to provide the Calculation Agent with its offered
quotation for United States dollar deposits for one month to prime banks in the
London interbank market as of 11:00 A.M., London time, on such date. If at least
two reference banks provide the Calculation Agent with such offered quotations,
LIBOR on such date will be the arithmetic mean, rounded upwards, if necessary,
to the nearest 1/100,000 of 1% (.0000001), with five one-millionths of a
percentage point rounded upward, of all such quotations. If on such date fewer
than two of the reference banks provide the Calculation Agent with such offered
quotations, LIBOR on such date will be the arithmetic mean, rounded upwards, if
necessary, to the nearest 1/100,000 of 1% (.0000001), with five one-millionths
of a percentage point rounded upward, of the offered per annum rates that one or
more leading banks in New York City selected by the Calculation Agent are
quoting as of 11:00 A.M., New York
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City time, on such date to leading European banks for United States dollar
deposits for one month; provided, however, that if such banks are not quoting as
described above, LIBOR for such date will be LIBOR applicable to the Interest
Period immediately preceding such Interest Period.]
"LIBOR Business Day" shall mean a day on which banking institutions in
New York, New York and London, England are not required or authorized by law to
be closed.
"LIBOR Determination Date" shall mean the second LIBOR Business Day
prior to any Interest Period for which LIBOR is calculated by the Calculation
Agent.
"Monthly Dilution Amount" shall mean an amount equal to the Weighted
Average Series Allocation Percentage of any Adjustment Payment required to be
deposited into the Collection Account pursuant to the Trust Sale and Servicing
Agreement with respect to the related Collection Period that has not been so
deposited as of the related Determination Date.
"Monthly Interest" shall mean the sum of (a) the Class A Monthly
Interest and (b) the Class B Monthly Interest.
"Monthly Servicing Fee" shall have the meaning specified in Section
3.01.
"Note Rate" shall mean the Class A Note Rate or the Class B Note Rate.
"Noteholder Charge-Offs" shall have the meaning specified in Section
4.07.
"Noteholder Charge-Off Reversal Amount" shall have the meaning set
forth in Section 4.04.
"Noteholder Default Amount" shall mean, with respect to any Payment
Date, an amount equal to the excess, if any, of (a) the product of the Series
200_-_ Allocable Defaulted Amount for the related Collection Period and the
Floating Allocation Percentage for the related Collection Period over (b) the
Incremental Subordinated Amount for that Payment Date.
"Noteholder Monthly Servicing Fee" shall have the meaning specified in
Section 3.01.
"Noteholder Non-Principal Collections" shall mean, with respect to any
Deposit Date, an amount equal to the Allocable Non-Principal Collections
(including any Series 200_-_ Allocable Miscellaneous Payments that are treated
as Allocable Non-Principal Collections pursuant to Section 4.01(e)) retained in
the Collection Account pursuant to Section 4.01(b) on such Deposit Date.
"Noteholder Principal Collections" shall mean, with respect to any
Deposit Date falling in the Accumulation Period or an Early Amortization Period,
the sum of (a) the Principal Allocation Percentage then in effect of Allocable
Principal Collections (including any Series 200_-_ Allocable
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Miscellaneous Payments that are treated as Allocable Principal Collections) and
(b) for any Deposit Date that is also a Payment Date, the amount, if any, of
Noteholder Non-Principal Collections, Investment Proceeds, funds in the Reserve
Fund and Additional Noteholder Collections allocated to cover the Noteholder
Default Amount or to reverse Noteholder Charge- Offs.
"Principal Allocation Percentage" shall mean, with respect to any day,
the percentage equivalent (which shall never exceed 100%) of a fraction, the
numerator of which is the Invested Amount as of the last day of the Revolving
Period and the denominator of which is the product of (x) the Pool Balance as of
such last day and (y) the Series 200_-_ Allocation Percentage for the day in
respect of which the Principal Allocation Percentage is being calculated;
provided, however, that, with respect to that portion of any Collection Period
that falls after the date on which any Early Amortization Event occurs, the
Principal Allocation Percentage shall be reset using the Pool Balance as of the
close of business on the date on which such Early Amortization Event shall have
occurred and Principal Collections shall be allocated for such portion of such
Collection Period using such reset Principal Allocation Percentage.
"Principal Funding Account" shall have the meaning specified in Section
4.03.
"Rating Agency" shall mean, with respect to the Series 200_-_ Notes,
each of [ ].
"Redemption Price" shall mean, with respect to any Payment Date, the
sum of (a) the aggregate outstanding principal balance of the Series 200_-_
Notes to be redeemed on the Determination Date preceding the Payment Date on
which such redemption is to be made, (b) accrued and unpaid interest on the
unpaid balance of the Series 200_-_ Notes (calculated on the basis of the
outstanding principal balance of the Series 200_-_ Notes at the Note Rate as in
effect during the applicable Interest Periods through the day preceding such
Payment Date[, and (c) any outstanding Carry-over Amount with respect to the
Series 200_-_ Notes to be repurchased].
"Required Draw Amount" shall mean the lesser of (a) the Deficiency
Amount and (b) the Available Subordinated Amount.
"Required Participation Percentage" shall mean, with respect to Series
200_-_, ____%.
"Required Subordinated Amount" shall mean, initially, $[ ] and
thereafter, as of any date of determination, the sum of (a) the product of the
Subordinated Percentage and the Invested Amount as of the opening of business on
such date and (b) the Incremental Subordinated Amount as of such date.
"Reserve Fund" shall have the meaning specified in Section 4.03.
"Reserve Fund Deposit Amount" shall mean, with respect to any Payment
Date, the amount, if any, by which (a) the Reserve Fund Required Amount for such
Payment Date exceeds
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(b) the amount of funds in the Reserve Fund after giving effect to any
withdrawals therefrom and deposits thereto on such Payment Date.
"Reserve Fund Required Amount" shall mean, on any Payment Date with
respect to an Early Amortization Period, an amount equal to the Excess Reserve
Fund Required Amount and, for any other Payment Date, an amount equal to 0.50%
of the outstanding principal balance of the Series 200_-_ Notes for the next
following Payment Date (after giving effect to any change therein on such
Payment Date).
"Revolving Period" shall mean the period beginning on the Series
Cut-Off Date and ending on the earlier of (a) the close of business on the day
immediately preceding the Accumulation Period Commencement Date, (b) the close
of business on the day an Early Amortization Period commences; provided,
however, that the Revolving Period may recommence in certain circumstances as
provided in Section 6.02 hereof.
"Series 200_-_" shall mean the Series 200_-_ Asset Backed Notes, the
terms of which are specified in this Series Supplement.
"Series 200_-_ Accounts" shall mean the Reserve Fund and the Principal
Funding Account.
"Series 200_-_ Allocable Defaulted Amount" shall mean, with respect to
any Collection Period, the product of (a) the Series Allocation Percentage with
respect to such Collection Period and (b) the Defaulted Amount with respect to
such Collection Period.
"Series 200_-_ Allocable Miscellaneous Payments" shall mean, with
respect to any day, the product of (a) the Series 200_-_ Allocation Percentage
for the related Collection Period and (b) Miscellaneous Payments with respect to
the related Collection Period.
"Series 200_-_ Allocation Percentage" shall mean the Series Allocation
Percentage with respect to Series 200_-_.
"Series 200_-_ Excess Funding Amount" shall mean, with respect to the
Series 200_-_ Notes, for any day, the product of (a) the Series 200_-_
Percentage on such day and (b) the amount on deposit in the Excess Funding
Account on such day; provided, however, that the Series 200_-_ Excess Funding
Amount shall be zero on any date after funds have been withdrawn from the Excess
Funding Account and deposited in the Principal Funding Account.
"Series 200_-_ Excess Principal Collections" shall mean, with respect
to any Deposit Date, an amount equal to the Series 200_-_ Principal Shortfall
for such Deposit Date; provided, however, that, if the aggregate amount of
Excess Principal Collections for such Deposit Date is less than the aggregate
amount of Principal Shortfalls for such Deposit Date, then Series 200_-_ Excess
Principal Collections for such Deposit Date shall equal the product of (x)
Excess Principal
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Collections for all Series for such Deposit Date and (y) a fraction, the
numerator of which is the Series 200_-_ Principal Shortfall for such Deposit
Date and the denominator of which is the aggregate amount of Principal
Shortfalls for all Series for such Deposit Date.
"Series 200_-_ Noteholders" shall mean the Holders of Series 200_-_
Notes.
"Series 200_-_ Note Owner" shall mean, with respect to a Series 200_-_
Note in Book Entry form, any person who is a beneficial owner of such note.
"Series 200_-_ Notes" shall mean the Series 200_-_ Asset Backed Notes,
substantially in the form of Exhibit A or Exhibit B, as applicable.
"Series 200_-_ Principal Shortfall" shall mean, with respect to any
Deposit Date, an amount equal to the excess of (i) the sum of (a) the Class A
Controlled Deposit Amount for such Deposit Date over (b) the Class B Controlled
Deposit Amount and (ii) the amount deposited into the Principal Funding Account
on such Deposit Date.
"Series Cut-Off Date" shall mean [ ], 2000.
"Series Issuance Date" shall mean [ ], 2000.
"Servicing Fee Rate" shall mean, unless otherwise waived, with respect
to Series 200_-_, 1.0%.
"Special Payment Date" shall mean each Payment Date with respect to an
Early Amortization Period.
"Stated Maturity Date" shall mean the Class A Stated Maturity Date or
the Class B Stated Maturity Date.
"Subordinated Percentage" shall mean the percentage equivalent of a
fraction, (a) the numerator of which is the Subordination Factor and (b) the
denominator of which will be the excess of 100% over the Subordination Factor.
"Subordination Factor" shall mean [ ]%.
"Telerate Page 3750" shall mean the display page so designated on the
Dow Jones Telerate Service (or such other page as may replace that page on that
service, or such other service as may be nominated as the information vendor,
for the purpose of displaying London interbank offered rates of major banks).
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"Weighted Average Floating Allocation Percentage" means, for any
Collection Period, a percentage equal to the result of (a) the sum of the
Floating Allocation Percentage for each day during that Collection Period,
divided by (b) the number of days in that Collection Period.
(b) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Series Supplement shall refer to this Series Supplement
as a whole and not to any particular provision of this Series Supplement;
references to any Article, Section or Exhibit are references to Articles,
Sections and Exhibits in or to this Series Supplement unless otherwise
specified; and the term "including" means "including without limitation."
ARTICLE II
CREATION OF THE SERIES 200_-_ NOTES
SECTION 2.01. Designation. (a) There is hereby created a Series of
Notes to be issued pursuant to the Indenture and this Series Supplement to be
known as the "Series 200_-_ Asset Backed Notes" (the "Series 200_-_ Notes").
Such Series shall be comprised of two classes: the Series 2000-1 [Floating Rate]
[___%] Asset Backed Notes, Class A (the "Class A Notes") and the Series 200_-_
[Floating Rate] [___%] Asset Backed Notes, Class B (the "Class B Notes").
(b) In the event that any term or provision contained herein shall
conflict with or be inconsistent with any term or provision contained in the
Indenture, the terms and provisions of this Series Supplement shall govern.
(c) The Issuer shall issue and the Indenture Trustee shall authenticate
and deliver to the Issuer the Class A Notes in the initial aggregate principal
amount of $__________ and the Class B Notes in the initial aggregate principal
amount of $___________.
ARTICLE III
SERVICING FEE
SECTION 3.01. Servicing Compensation. The monthly servicing fee with
respect to Series 200_-_ (the "Monthly Servicing Fee") shall be payable to the
Servicer, in arrears, on each Payment Date in respect of any Collection Period
(or portion thereof) occurring on or prior to the earlier of the first Payment
Date following the Stated Maturity Date and the first Payment Date on which the
Invested Amount is zero, in an amount equal to one-twelfth of the product of (a)
the Servicing Fee Rate and (b) the Series 200_-_ Allocation Percentage of the
Pool Balance (excluding the amount of Principal Receivables relating to
Non-Serviced Participated Receivables) in each case, as of the last day of the
second Collection Period preceding such Payment Date. The
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share of the Monthly Servicing Fee allocable to the Series 200_-_ Noteholders
with respect to any Payment Date (the "Noteholder Monthly Servicing Fee") shall
be equal to one-twelfth of the product of (a) the Servicing Fee Rate and (b) the
Invested Amount as of the last day of the Collection Period second preceding
such Payment Date; provided, however, that the Noteholder Monthly Servicing Fee
with respect to the first Payment Date will be $___________. The remainder of
the Monthly Servicing Fee for the first Payment Date and each subsequent Payment
Date shall be paid by the Certificateholders and, in no event shall the Trust or
the Series 200_-_ Noteholders be liable for the share of the Monthly Servicing
Fee to be paid by the Certificateholders. The remainder of the Servicing Fee
shall be paid by the Certificateholders and the Noteholders of other Series and
the Series 200_-_ Noteholders shall in no event be liable for the share of
Servicing Fee to be paid by the Certificateholders or the Noteholders of other
Series. The Noteholder Monthly Servicing Fee shall be payable to the Servicer
solely to the extent amounts are available for distribution in accordance with
the terms of the Trust Sale and Servicing Agreement and Section 4.04(a) of this
Series Supplement.
ARTICLE IV
RIGHTS OF SERIES 200_-_ NOTEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.01. Daily Allocations; Payments to Certificateholders. On
each Deposit Date, Non-Principal Collections, Principal Collections and
Miscellaneous Payments allocable to the Series 200_-_ shall be allocated and
distributed as set forth in this Section 4.01.
(a) Certificateholder Collections; Additional Noteholder Collections.
The Servicer will instruct the Indenture Trustee in writing to withdraw the
following amounts from the Collection Account and apply such amounts as follows
on each Deposit Date:
(i) an amount equal to the Excess Certificateholder Percentage then
in effect for the related Collection Period of Allocable Non-Principal
Collections deposited in the Collection Account for such Deposit Date
shall be paid to the Certificateholders;
(ii) an amount equal to the Excess Certificateholder Percentage
then in effect for the related Collection Period of Allocable Principal
Collections deposited in the Collection Account for such Deposit Date
shall be paid to the Certificateholders, provided, however, that if the
Pool Balance (determined after giving effect to any Principal
Receivables transferred to the Trust on such Deposit Date) is less than
the Required Pool Balance for such Deposit Date (after giving effect to
the allocations, distributions, withdrawals and deposits to be made on
such Deposit Date), such funds will be deposited into the Excess
Funding Account to the extent necessary so that the Pool Balance at
least equals the Required Pool Balance;
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(iii) an amount equal to the Additional Noteholder Non-Principal
Collections for such Deposit Date shall be retained in the Collection
Account; provided, however, that during the Revolving Period and the
Accumulation Period, the amount so retained shall not exceed the excess
if any, of the Reserve Fund Required Amount over the amount in the
Reserve Fund (after giving effect to the allocations, distributions,
withdrawals and deposits to be made on the Payment Date immediately
following such Deposit Date), and if on any day the amount so retained
exceeds such excess, the amount retained which exceeds such excess may
be withdrawn from the Collection Account and applied in accordance with
Section 4.01(a)(v).
(iv) an amount equal to the Additional Noteholder Principal
Collections for an Early Amortization Period shall be retained in the
Collection Account and treated as Noteholder Principal Collections; and
(v) any remaining Additional Noteholder Collections for such
Deposit Date not required to be retained in the Collection Account
pursuant to Section 4.01(a)(iii) and (iv) or distributed pursuant to
Section 4.06(b) shall be paid to the Certificateholders; provided,
however, that if the Pool Balance (determined after giving effect to
any Principal Receivables transferred to the Trust on such Deposit
Date) is less than the Required Pool Balance (after giving effect to
the allocations, distributions, withdrawals and deposits to be made on
that Deposit Date), such funds shall be deposited into the Excess
Funding Account to the extent necessary so that the Pool Balance at
least equals the Required Pool Balance.
(b) Noteholder Non-Principal Collections. On each Deposit Date, the
Servicer shall allocate to Series 200_-_ and retain in the Collection Account an
amount equal to the Floating Allocation Percentage then in effect of Allocable
Non-Principal Collections deposited in the Collection Account for such Deposit
Date.
(c) Noteholder Principal Collections - Revolving Period. On each
Deposit Date falling in the Revolving Period, the Servicer shall allocate to
Series 200_-_ and treat as Excess Principal Collections an amount equal to the
Floating Allocation Percentage then in effect of Allocable Principal Collections
deposited in the Collection Account for such Deposit Date plus any Series 2000-1
Allocable Miscellaneous Payments treated as Available Noteholder Principal
Collections pursuant to Section 4.01(c) on such Deposit Date.
(d) Noteholder Principal Collections - Other Periods. On each Deposit
Date falling in the Accumulation Period or the Early Amortization Period, the
Servicer shall allocate and deposit an amount equal to Available Noteholder
Principal Collections as follows:
(i) first, an amount up to the Class A Controlled Deposit Amount
for such Deposit Date shall be deposited by the Servicer or the
Indenture Trustee into the Principal Funding Account;
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(ii) second, an amount up to the Class B Controlled Deposit Amount
for such Deposit Date shall be deposited by the Servicer or the
Indenture Trustee into the Principal Funding Account; and
(iii) third, after giving effect to the transactions referred to in
clauses (i) and (ii) above, an amount equal to the balance, if any, of
such Available Noteholder Principal Collections shall be treated as
Excess Principal Collections and applied in accordance with Section 4.4
of the Trust Sale and Servicing Agreement and Section 4.08 hereof.
(e) Miscellaneous Payments. On each Deposit Date, the Servicer shall
treat any Series 200_-_ Allocable Miscellaneous Payments as Available Noteholder
Principal Collections and apply them as provided in Section 4.01(c) or (d), as
appropriate, except that Series 200_-_ Allocable Miscellaneous Payments
consisting of Adjustment Payments that were paid after their due date as per
Section 3.9(a) of the Trust Sale and Servicing Agreement, if the amount of such
overdue Adjustment Payments has been included in the Monthly Dilution Amount for
any prior Monthly Period, shall be treated as Allocable Non-Principal
Collections and applied as provided in Section 4.01(b).
SECTION 4.02. Monthly Interest.
(a) The amount of interest accrued during an Interest Period with
respect to the Class A Notes (the "Class A Monthly Interest") shall be an amount
equal to the product of (i) the Class A Note Rate, (ii) the outstanding
principal balance of the Class A Notes as of the close of business on the
preceding Payment Date (after giving effect to all repayments of principal made
to Class A Noteholders on such preceding Payment Date, if any) and (iii) a
fraction, the numerator of which is [the actual number of days elapsed in such
Interest Period] [30] and the denominator of which is [360].
(b) The amount of monthly interest accrued during an Interest Period
with respect to the Class B Notes (the "Class B Monthly Interest") shall be an
amount equal to the product of (i) the Class B Note Rate, (ii) the outstanding
principal balance of the Class B Notes as of the close of business on the
preceding Payment Date (after giving effect to all repayments of principal made
to Class B Noteholders on such preceding Payment Date, if any) and (iii) a
fraction, the numerator of which is [the actual number of days elapsed in such
Interest Period] [30] and the denominator of which is [360].
(c) [The Class A Carry-over Amount, if any, will be paid on any Payment
Date where the Class A Note Rate is based on the Assets Receivable Rate, to the
extent funds are allocated and available therefor after making all required
distributions and deposits with respect to the Series 2000-1 Notes, including
payments with respect to principal (including deposits to the Excess Funding
Account), Monthly Interest, the Noteholder Monthly Servicing Fee, the Reserve
Fund Deposit Amount, the Noteholder Default Amount and the Monthly Dilution
Amount. The Class
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B Carry-over Amount, if any, will be paid on any Payment Date where the Class B
Note Rate is based on the Assets Receivable Rate, to the extent funds are
allocated and available therefor after making all required distributions and
deposits with respect to the Series 2000-1 Notes, including payments with
respect to principal (including deposits to the Excess Funding Account), Monthly
Interest, the Noteholder Monthly Servicing Fee, the Reserve Fund Deposit Amount,
the Noteholder Default Amount, the Monthly Dilution Amount and the Class A
Carry-over Amount.]
SECTION 4.03. Establishment of the Series 200_-_ Accounts.
(a) The Servicer, for the benefit of the Series 200_-_ Noteholders,
shall cause to be established and maintained in the name of the Indenture
Trustee, on behalf of the Trust, an Eligible Deposit Account (the "Reserve
Fund") which shall be identified as the "Reserve Fund for the World Omni Master
Owner Trust, Series 200_-_" and shall bear a designation clearly indicating that
the funds deposited therein are held for the benefit of the Series 200_-_
Noteholders. On the Series Issuance Date, the Seller shall cause to be deposited
in the Reserve Fund the Initial Reserve Fund Deposit Amount.
(b) At the written direction of the Servicer, funds on deposit in the
Reserve Fund shall be invested by the Indenture Trustee in Eligible Investments
selected by the Servicer that will mature so that such funds will be available
at the close of business on or before the Business Day two Business Days before
the following Payment Date (on or before 10:00 a.m. on such following Payment
Date in the case of Eligible Investments in respect of which the Indenture
Trustee is the obligor or Eligible Investments specified in clauses (h) and (j)
of the definition thereof). All Eligible Investments shall be held by the
Indenture Trustee for the benefit of the Series 200_-_ Noteholders. On each
Payment Date, all interest and other investment earnings (net of losses and
investment expenses) on funds on deposit in the Reserve Fund received prior to
such Payment Date shall be deposited in the Collection Account and treated as
Investment Proceeds and applied as set forth in Section 4.04(a) of this Series
Supplement. Funds deposited in the Reserve Fund on a Business Day (which
immediately precedes a Payment Date) upon the maturity of any Eligible
Investments are not required to be invested overnight. In no event shall the
Indenture Trustee be liable for the selection of Eligible Investments or for
investment losses incurred thereon. The Indenture Trustee shall have no
liability in respect of losses incurred as a result of the liquidation of any
Eligible Investments prior to its stated maturity or failure of the Servicer to
provide timely written direction.
(c) The Servicer, for the benefit of the Noteholders, shall establish
and maintain in the name of the Indenture Trustee, on behalf of the Trust, an
Eligible Deposit Account (the "Principal Funding Account"), which shall be
identified as the "Principal Funding Account for World Omni Master Owner Trust,
Series 200_-_" and shall bear a designation clearly indicating that the funds
deposited therein are held for the benefit of the Series 200_-_ Noteholders.
(d) At the written direction of the Servicer, funds on deposit in the
Principal Funding Account shall be invested by the Indenture Trustee in Eligible
Investments selected by the Servicer
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that will mature so that such funds will be available on or before the close of
business on the Business Day two business days before the following Payment Date
(on or before 10:00 a.m. on such following Payment Date in the case of Eligible
Investments in respect of which the Indenture Trustee is the obligor or Eligible
Investments specified in clauses (h) and (j) of the definition thereof). All
such Eligible Investments shall be held by the Indenture Trustee for the benefit
of the Series 200_-_ Noteholders. On each Payment Date all interest and other
investment earnings (net of losses and investment expenses) on funds on deposit
therein shall be deposited in the Collection Account and treated as Investment
Proceeds and applied as set forth in Section 4.04(a) of this Series Supplement.
Funds deposited in the Principal Funding Account on a Business Day (which
immediately precedes an Expected Principal Payment Date) upon the maturity of
any Eligible Investments are not required to be invested overnight. In no event
shall the Indenture Trustee be liable for the selection of Eligible Investments
or for investment losses incurred thereon. The Indenture Trustee shall have no
liability in respect of losses incurred as a result of the liquidation of any
Eligible Investments prior to its stated maturity or failure of the Servicer to
provide timely written direction.
(e) The Indenture Trustee shall possess all right, title and interest
in and to all funds on deposit from time to time in, and all Eligible
Investments credited to, the Reserve Fund and the Principal Funding Account
(collectively, the "Series 200_-_ Accounts") and in all proceeds thereof. The
Series 200_-_ Accounts shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Noteholders. If, at any time, any of
the Series 200_-_ Accounts ceases to be an Eligible Deposit Account, the
Indenture Trustee (or the Servicer on its behalf) shall within 10 Business Days
(or such longer period, not to exceed 30 calendar days, as to which each Rating
Agency has consented) establish and maintain in the name of the Indenture
Trustee a new Series 200_-_ Account (which shall be an Eligible Deposit Account
and which shall bear a designation clearly indicating that the funds deposited
therein are held for the benefit of the Series 200_-_ Noteholders) and shall
transfer any cash and/or any investments to such new Series 200_-_ Account.
Neither the Seller, the Servicer nor any person or entity claiming by, through
or under the Seller, the Servicer or any such person or entity shall have any
right, title or interest in, or any right to withdraw any amount from, any
Series 200_-_ Account, except as expressly provided herein. Schedule 1, which is
hereby incorporated into and made part of this Series Supplement, identifies
each Series 200_-_ Account by setting forth the account number of each such
account, the account designation of each such account and the name of the
institution with which such account has been established. If a substitute Series
200_-_ Account is established pursuant to this Section, the Servicer shall
provide to the Indenture Trustee an amended Schedule 1, setting forth the
relevant information for such substitute Series 200_-_ Account.
(f) Pursuant to the authority granted to the Servicer in Section 8.2 of
the Indenture and Section 3.1(a) and Section 4.2 of the Trust Sale and Servicing
Agreement, the Servicer shall have the power, revocable by the Indenture Trustee
to instruct the Indenture Trustee to make withdrawals and payments from the
Series 200_-_ Accounts for the purposes of carrying out the Servicer's or
Indenture Trustee's duties hereunder.
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SECTION 4.04. Application of Noteholder Non-Principal Collections,
Investment Proceeds and Available Noteholder Principal Collections. The Servicer
shall cause the Indenture Trustee to make the following distributions:
(a) On each Payment Date, commencing with the Initial Payment Date, an
amount equal to the sum of Noteholder Non-Principal Collections and any
Investment Proceeds with respect to such Payment Date will be distributed, to
the extent funds are available therefor, in the following priority:
(i) first, an amount equal to Class A Monthly Interest for such
Payment Date, plus the amount of any Class A Monthly Interest
previously due but not distributed to the Class A Noteholders on a
prior Payment Date (plus interest thereon) shall be distributed to the
Class A Noteholders;
(ii) second, an amount equal to Class B Monthly Interest for such
Payment Date, plus the amount of any Class B Monthly Interest
previously due but not distributed to the Class B Noteholders on a
prior Payment Date (plus interest thereon) shall be distributed to the
Class B Noteholders;
(iii) third, an amount equal to the Noteholder Monthly Servicing
Fee for such Payment Date shall be distributed to the Servicer (unless
such amount has been netted against deposits to the Collection Account
or waived);
(iv) fourth, an amount equal to the Reserve Fund Deposit Amount, if
any, for such Payment Date shall be deposited in the Reserve Fund;
(v) fifth, an amount equal to the Noteholder Default Amount and the
Monthly Dilution Amount for such Payment Date shall be treated as a
portion of Noteholder Principal Collections for such day;
(vi) sixth, an amount equal to the aggregate amount of Noteholder
Charge-Offs which have not been previously reversed as provided in
this Section 4.04(a)(vii) shall be treated as a portion of Noteholder
Principal Collections for such day and shall increase the Invested
Amount (the "Noteholder Charge-Off Reversal Amount");
(vii) seventh, an amount equal to the amount of reductions of the
Available Subordinated Amount on account of Noteholder Default Amounts
and Monthly Dilution Amounts that have not previously been reinstated
shall be distributed to the Certificateholders and shall increase the
Available Subordinated Amount;
(viii) [eighth, an amount equal to any outstanding Class A
Carry-over Amount shall be distributed to the Class A Noteholders;]
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(ix) [ninth, an amount equal to any outstanding Class B Carry-over
Amount shall be distributed to the Class B Noteholders;]
(x) tenth, an amount equal to the aggregate outstanding amounts of
Noteholder Monthly Servicing Fee which have been previously waived
shall be distributed to the Servicer; and
(xi) eleventh, the balance shall be distributed to the
Certificateholders.
(b) In the event that the Class B Invested Amount is greater than zero
on the Class B Stated Maturity Date, any funds remaining in the Reserve Account
(after the application of funds in the Reserve Fund as described in Section 4.06
hereof) will be treated as a portion of Available Noteholder Principal
Collections for the Payment Date occurring on the Class B Stated Maturity Date.
SECTION 4.05. Distributions to Series 200_-_ Noteholders. Payments to
Series 2000-1 Noteholders will be made from the Collection Account, the Reserve
Fund or the Principal Funding Account, as applicable.
(a) on each Payment Date, the Servicer shall cause the Indenture
Trustee to distribute the amounts on deposit in the Collection Account and the
Reserve Fund that are payable to the Series 200_-_ Noteholders with respect to
accrued interest to the Series 200_-_ Noteholders in accordance with Section
4.04(a); provided, however, that no Class B Monthly Interest shall be paid to
the Class B Noteholders until all Class A Monthly Interest and interest on
unpaid Class A Monthly Interest has been paid to the Class A Noteholders [and no
Class B Carry-over Amount shall be paid to the Class B Noteholders until any
outstanding Class A Carry-over Amount has been paid to the Class A Noteholders].
(b) The Servicer shall instruct the Indenture Trustee to apply the
funds on deposit in the Principal Funding Account and the Collection Account and
shall instruct the Indenture Trustee to make, without duplication, the following
distributions at the following times:
(i) on the Expected Principal Payment Date and each Special Payment
Date all amounts on deposit in the Principal Funding Account and the
Collection Account as are payable to the Class A Noteholders with
respect to principal shall be distributed to the Class A Noteholders up
to a maximum amount on any such day equal to the outstanding principal
balance of the Class A Notes on such date; provided, however, in no
event shall such amount exceed the Class A Invested Amount; and
(ii) if all of the amounts due and owing to the Class A Noteholders
pursuant to clause (i) above have been paid in full, on the Expected
Principal Payment Date and each Special Payment Date, all amounts on
deposit in the Principal Funding Account and
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the Collection Account as are payable to Class B Noteholders with
respect to principal shall be distributed to the Class B Noteholders up
to a maximum amount on any such day equal to the outstanding principal
balance of the Class B Notes on such date; provided, however, in no
event shall such amount exceed the Class B Invested Amount.
(c) [On each Payment Date on which there is an unpaid Class A
Carry-over Amount, the Servicer shall instruct the Indenture Trustee to
distribute to the Class A Noteholders such Class A Carry-over Amount to the
extent funds are available therefor after making all required distributions and
deposits with respect to the Series 200_-_ Notes pursuant to Section 4.04(a).]
(d) [On each Payment Date on which there is an unpaid Class B
Carry-over Amount, the Servicer shall instruct the Indenture Trustee to
distribute to the Class B Noteholders such Class B Carry-over Amount to the
extent funds are available therefor after making all required distributions and
deposits with respect to the Series 200_-_ Notes pursuant to Section 4.04(a).]
(e) [If on the Class A Stated Maturity Date there is any Class A
Carry-over Amount or on the Class B Stated Maturity Date there is any Class B
Carry-over Amount or on the date on which the principal amount of the Series
200_-_ Notes has been reduced to zero there is any Carry-over Amount (in each
case after giving effect to any distributions on such date pursuant to Section
4.04(a) and (b) above), the Servicer shall instruct the Indenture Trustee to
distribute to the Class A Noteholders or the Class B Noteholders, as applicable,
the amounts payable with respect thereto pursuant to Section 4.06(a) and (b).]
(f) The distributions to be made pursuant to this Section are subject
to the provisions of Section 4.3 of the Trust Sale and Servicing Agreement,
Section 2.7(c) of the Indenture and Section 8.01 of this Series Supplement.
SECTION 4.06. Application of Reserve Fund and Available Subordinated
Amount.
(a) If the portion of Noteholder Non-Principal Collections and
Investment Proceeds allocated to Series 200_-_ Noteholders on any Payment Date
pursuant to Section 4.04(a) is not sufficient to make the entire distributions
required on such Payment Date by (a) Sections 4.04(a)(i), (ii), (iii) and (v)
[or (b) on the Class A Stated Maturity Date only, Section 4.04(a)(viii) and on
the Class B Stated Maturity Date only, Section 4.04(a)(ix)], the Servicer shall
cause the Indenture Trustee to withdraw funds from the Reserve Fund [(in the
case of Section 4.04(a)(viii) and (ix), only to the extent such amounts would
otherwise be distributed to the Certificateholders)] to the extent available
therein, and apply such funds to complete the distributions pursuant to Section
4.04(a)(i), (ii), (iii), (v), [(viii) and (ix)], as the case may be, provided,
however, that during any Early Amortization Period funds shall not be withdrawn
from the Reserve Fund to make distributions otherwise required by Section
4.04(a)(v) to the extent that, after giving effect to such withdrawal, the
amount on deposit in the Reserve Fund shall be less than $1,000,000.
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(b) If the amounts allocated to the Series 200_-_ Noteholders pursuant
to Section 4.04(a) and the amounts withdrawn from the Reserve Fund pursuant to
Section 4.06(a) are not sufficient to make the entire distributions required by
clauses (i), (ii), (iii) and (v) of Section 4.04(a) (such shortfall being the
"Deficiency Amount"), the Servicer shall cause the Indenture Trustee to apply
the amount of Additional Noteholder Collections for the related Collection
Period on deposit in the Collection Account on such Payment Date, but only up to
the Available Subordinated Amount, to make the distributions required by clauses
(i), (ii), (iii) and (v) of Section 4.04(a) that have not been made [and, if
such Payment Date is the Class A Stated Maturity Date, the Class B Stated
Maturity Date or the date on which the principal amount of the Series 200_-_
Notes has been reduced to zero, the distributions required by Section
4.04(a)(viii) in the case of the Class A Stated Maturity Date and Section
4.04(a)(ix) in the case of the Class B Stated Maturity Date or both Sections
4.04(a)(viii) and (ix) in the case of the date on which the principal amount of
the Series 200_-_ Notes has been reduced to zero that have not been made.] The
Available Subordinated Amount will be reduced by the amount of Additional
Noteholder Collections applied in accordance with the preceding sentence. If the
amount necessary to complete the distributions referred to in this paragraph (b)
exceeds Additional Noteholder Collections for such Payment Date, the Available
Subordinated Amount shall be further reduced (but not below zero) by the amount
of such excess, but not by more than the sum of (x) the Noteholder Default
Amount and (y) the amount of unpaid Adjustment Payments allocated to the Series
200_-_ Notes.
(c) If, after giving effect to the allocations of, distributions from,
and deposits in, the Reserve Fund made pursuant to Section 4.04(a) and this
Section 4.06, (i) the amount in the Reserve Fund is greater than the Reserve
Fund Required Amount for such Payment Date, the Servicer shall cause the
Indenture Trustee to distribute such excess amount to the Certificateholders,
subject to the proviso contained in paragraph (d) or (ii) the amount in the
Reserve Fund is less than such Reserve Fund Required Amount, the Indenture
Trustee shall deposit any remaining Additional Noteholder Non-Principal
Collections on deposit in the Collection Account for such Payment Date into the
Reserve Fund until the amount in the Reserve Fund is equal to such Reserve Fund
Required Amount. After the earlier to occur of the payment in full of the
outstanding principal balance of the Series 2000-1 Notes and the Class B Stated
Maturity Date, any funds remaining on deposit in the Reserve Fund shall be paid
to the Certificateholders.
(d) The balance of Additional Noteholder Collections on any Payment
Date, after giving effect to any distributions thereof pursuant to Section
4.06(b) or (c), shall be distributed to the Certificateholders on such Payment
Date; provided, however, that if the Required Pool Balance for the immediately
preceding Determination Date exceeds the Pool Balance on such date (determined
after giving effect to any Principal Receivables transferred to the Trust on
such Payment Date), Section 4.06(c) hereof shall not apply and the amount of
such excess shall be deposited into the Excess Funding Account, with any
remaining Additional Noteholder Collections paid to the Certificateholders.
SECTION 4.07. Noteholder Charge-Offs. If, on any Payment Date on which
the Available Subordinated Amount on the preceding Determination Date (after
giving effect to the
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allocations, distributions, withdrawals and deposits to be made on such Payment
Date) is zero and the Deficiency Amount for such Payment Date is greater than
zero, the Invested Amount of the Series 200_-_ Notes shall be reduced (a
"Noteholder Charge-Off") by the Deficiency Amount, but not by more than the sum
of the Noteholder Default Amount and the Monthly Dilution Amount to the extent
not covered by applications made pursuant to Sections 4.04 and 4.06 for such
Payment Date. Any such reduction shall be applied first to reduce the Class B
Invested Amount (a "Class B Noteholder Charge-Off") but not below zero, and then
to reduce the Class A Invested Amount (a "Class A Noteholder Charge-Off") but
not below zero. Noteholder Charge-Offs shall thereafter be reversed and the
Invested Amount increased (but not by an amount in excess of the aggregate
unreversed Noteholder Charge-Offs on any Payment Date) by the Noteholder's
Charge-off Reversal Amount. Any such increase shall be applied first to the
Class A Invested Amount until all previously unreversed Class A Noteholder
Charge-Offs have been reversed and then to the Class B Invested Amount until all
previously unreversed Class B Noteholder Charge- Offs have been reversed.
SECTION 4.08. Excess Principal Collections. The Servicer will allocate
Series 200_-_ Excess Principal Collections and instruct the Indenture Trustee to
deposit into the Principal Funding Account an amount equal to the Series 200_-_
Principal Shortfall, to the extent available. In the event there is no Series
200_-_ Principal Shortfall, Excess Principal Collections will be allocated and
distributed in accordance with Section 4.4 of the Trust Sale and Servicing
Agreement.
SECTION 4.09. Accumulation Period Length; Accumulation Period
Commencement Date. Beginning on the [ ] Payment Date, and on each Payment Date
thereafter that occurs prior to the Accumulation Period Commencement Date, the
Servicer shall calculate the Accumulation Period Length and, if applicable,
determine the Accumulation Period Commencement Date. The Servicer shall promptly
notify the Indenture Trustee in writing of the Accumulation Period Commencement
Date and the Accumulation Period Length.
SECTION 4.10. Excess Funding Account. On the last day of the Revolving
Period, the Series 200_-_ Excess Funding Amount will be deposited in the
Principal Funding Account on such date and distributed in accordance with
Section 4.05(b). Thereafter, the Series 200_-_ Noteholders will not be entitled
to any funds on deposit in the Excess Funding Account.
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ARTICLE V
DISTRIBUTIONS AND REPORTS
TO SERIES 200_-_ NOTEHOLDERS
SECTION 5.01. Distributions.
(a) On each Payment Date, the Indenture Trustee shall distribute to
each Series 200_- _ Noteholder of record on the preceding Record Date (other
than as provided in Section 2.7(c) of the Indenture respecting a final
distribution) such Noteholder's pro rata share (based on the aggregate
fractional undivided interests represented by such class of Series 200_-_ Notes
held by such Noteholder) of the amounts on deposit in the Series 200_-_ Accounts
as is payable to such class of Series 200_-_ Noteholders on such Payment Date
pursuant to Section 4.04 and 4.05.
(b) Except as provided in Section 2.7(c) of the Indenture with respect
to a final distribution, distributions to Series 200_-_ Noteholders hereunder
shall be made by check mailed to each Series 200_-_ Noteholder at such
Noteholder's address appearing in the Note Register without presentation or
surrender of any Series 200_-_ Note or the making of any notation thereon;
provided, however, that, with respect to Series 200_-_ Notes registered in the
name of a Depository, such distributions shall be made to such Depository in
immediately available funds.
SECTION 5.02. Reports and Statements to Series 200_-_ Noteholders.
(a) On or prior to each Payment Date (including each date that
corresponds to the Expected Principal Payment Date or Special Payment Date),
commencing with the initial Payment Date, the Servicer will provide to the
Indenture Trustee, and on each Payment Date, the Indenture Trustee shall forward
to each Series 200_-_ Noteholder (provided the Indenture Trustee has received
such report from the Servicer), a statement prepared by the Servicer,
substantially in the form attached as Exhibit C hereto, setting forth the
following information relating to the Trust and the Series 200_-_ Notes:
(i) the aggregate amount of Collections, the aggregate amount of
Non- Principal Collections and the aggregate amount of Principal
Collections processed during the immediately preceding Collection
Period and the Pool Balance, the Required Pool Balance and the Excess
Funding Account Balance as of the close of business on the last day of
the preceding Collection Period;
(ii) the Series Allocation Percentage, the Floating Allocation
Percentage and the Principal Allocation Percentage for the preceding
Collection Period;
(iii) the total amount, if any, distributed on the Class A Notes
and the Class B Notes;
(iv) the amount of such distribution allocable to principal on each
class of Series 200_-_ Notes;
(v) the amount of such distribution allocable to interest on each
class of Series 200_-_ Notes;
(vi) the Noteholder Default Amount for such Payment Date;
23
<PAGE>
(vii) the Required Draw Amount, if any, for such Collection Period;
(viii) the amount of Noteholder Charge-Offs and the amounts of the
reversals thereof for such Collection Period;
(ix) the amount of the Monthly Servicing Fee and the Noteholder
Monthly Servicing Fee for such Collection Period;
(x) the Class A Controlled Deposit Amount and Class B Controlled
Deposit Amount for the following Payment Date, if any;
(xi) the Invested Amount and the outstanding principal balance of
each Class of Series 200_-_ Notes for such Payment Date (after giving
effect to all distributions which will occur on such Payment Date);
(xii) the Available Subordinated Amount as of the last day of the
Collection Period;
(xiii) the Reserve Fund balance for such date; and
(xiv) the balance of the Principal Funding Account with respect to
such date.
(b) A copy of each statement provided pursuant to paragraph (a) will be
made available for inspection at the Corporate Trust Office of the Indenture
Trustees.
(c) On or before April 30 of each calendar year, beginning with
calendar year 2001, the Indenture Trustee shall furnish or cause to be furnished
to each Person who at any time during the preceding calendar year was a Series
200_-_ Noteholder (or Note Owner), a report prepared by the Servicer containing
the information which is required to be contained in the statement to Series
200_-_ Noteholders as set forth in paragraph (a) above, aggregated for such
calendar year or the applicable portion thereof during which such Person (or any
related Note Owner) was a Series 2000-1 Noteholder (or Note Owner). The Servicer
shall prepare and the Indenture Trustee shall furnish to each person who was a
Series 2000-1 Noteholder (or Note Owner) during the preceding calendar year in
the time and manner required by the Code such information as is required to be
provided by an issuer of indebtedness under the Code, including Forms 1099 and
such other customary information as is necessary to enable the Series 200_-_
Noteholders (or Note Owners) to prepare their tax returns. Such obligation of
the Indenture Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be provided by the Indenture Trustee
pursuant to any requirements of the Code as from time to time in effect.
24
<PAGE>
ARTICLE VI
EARLY AMORTIZATION EVENTS
SECTION 6.01. Additional Early Amortization Events.
(a) Except as provided in Section 6.01(b), the occurrence of any of the
following events shall, immediately upon the occurrence thereof without notice
or other action on the part of the Indenture Trustee or the Series 200_-_
Noteholders, be deemed to be an Early Amortization Event solely with respect to
Series 200_-_:
(i) on any Determination Date, the average of the Monthly Payment
Rates for the three preceding Collection Periods is less than 30%;
(ii) on any Determination Date, the Available Subordinated Amount
for the next Payment Date will be reduced to an amount less than the
Required Subordinated Amount on such Determination Date, after giving
effect to the distributions to be made on the next Payment Date;
(iii) any Servicing Default with respect to the Series 200_-_ Notes
occurs;
(iv) [any Carry-Over Amount is outstanding on six consecutive
Payment Dates];
(v) failure on the part of the Transferor, the Servicer or World
Omni, as applicable, (a) to make any payment or deposit required by the
Trust Sale and Servicing Agreement or the Receivables Purchase
Agreement, including but not limited to any Transfer Deposit Amount or
Adjustment Payment, on or before the date occurring ten Business Days
after the date such payment or deposit is required to be made therein;
or (b) to deliver a Payment Date Statement on the date required under
the Trust Sale and Servicing Agreement (or within the applicable grace
period which will not exceed five business days); (c) to comply with
its covenant not to create any lien on a Receivable; or (d) to observe
or perform in any material respect any other covenants or agreements
set forth in the Trust Sale and Servicing Agreement or the Receivables
Purchase Agreement, which failure continues unremedied for a period of
45 days after written notice of such failure; and
(vi) any representation or warranty made by World Omni in the
Receivables Purchase Agreement or by the Transferor in the Trust Sale
and Servicing Agreement or any information required to be given by the
Transferor to the Indenture Trustee to identify the Accounts proves to
have been incorrect in any material respect when made and continues to
be incorrect in any material respect for a period of 60 days after
written notice and as a result the interests of the Noteholders are
materially and adversely affected;
25
<PAGE>
provided, however, that an Early Amortization Event shall not be deemed
to occur thereunder if the Transferor has repurchased the related
Receivables or all such Receivables, if applicable, during such period
in accordance with the provisions of the Trust Sale and Servicing
Agreement; and
(vii) the occurrence of an Event of Default with respect to the
Series 200_-_ Notes and the declaration that the Series 200_-_ Notes
are due and payable pursuant to Section 5.2 of the Indenture.
(b) In the case of any event described in Section 6.01(a)(iii), (v),
(vi) or (vii) above, an Early Amortization Event with respect to Series 200_-_
will be deemed to have occurred only if, after the applicable grace period
described in such clauses, either (i) the Indenture Trustee or (ii) Series
200_-_ Noteholders holding Series 200_-_ Notes evidencing more than 50% of the
aggregate unpaid principal amount of the Class A Notes, by written notice to the
Certificateholders and the Servicer (and the Indenture Trustee, if such notice
is given by Series 200_-_ Noteholders) declare that an Early Amortization Event
has occurred as of the date of such notice.
SECTION 6.02 Recommencement of the Revolving Period. If any Early
Amortization Event (other than an Early Amortization Event described in Section
5.17 of the Indenture) occurs, the Revolving Period will recommence following
receipt of (i) written confirmation by each Rating Agency that its rating of the
Series 200_-_ Notes will not be withdrawn or lowered as a result of such
recommencement and (ii) the consent of Noteholders evidencing more than 50% of
the aggregate unpaid principal amount of the Controlling Class of Series 200_-_
Notes to such recommencement, provided that no other Early Amortization Event
that has not been cured or waived as described herein has occurred and the
scheduled termination of the Revolving Period has not occurred.
ARTICLE VII
OPTIONAL REDEMPTION
SECTION 7.01. Optional Redemption.
(a) On any Payment Date occurring after the date on which the aggregate
outstanding principal balance of the Series 200_-_ Notes is reduced to $[ ] or
less (which amount shall equal 10% of the initial outstanding principal balance
of the Series 200_-_ Notes), the Servicer shall have the option to redeem the
Series 200_-_ Notes in whole but not in part at a purchase price equal to the
Redemption Price for such Payment Date.
(b) The Servicer shall give the Indenture Trustee at least 10 days'
prior written notice of the Payment Date on which the Servicer intends to
exercise such purchase option. Not later than 12:00 noon, New York City time, on
such Payment Date, the Servicer shall deposit an amount
26
<PAGE>
equal to the sum of (i) the Series Allocable Excess Funding Amount (in a maximum
amount not exceeding the Redemption Price) and (ii) the excess, if any, of the
Redemption Price over the amount calculated in clause (i) into the Collection
Account in immediately available funds. Such purchase option is subject to
payment in full of the Redemption Price. The Redemption Price shall be
distributed as set forth in Section 8.01.
ARTICLE VIII
FINAL DISTRIBUTIONS
SECTION 8.01. Acquisition of Notes Pursuant to Section 10.1 of the
Indenture; Distributions pursuant to Section 7.01 of this Series Supplement or
Section 8.04 of the Indenture.
(a) The amount to be paid by the Issuer to the Principal Funding
Account with respect to Series 200_-_ Notes in connection with a purchase of the
Notes pursuant to Section 10.01 of the Indenture shall equal the Redemption
Price for the Payment Date on which such repurchase occurs.
(b) With respect to the amount deposited into the Collection Account
pursuant to Section 7.01 of this Series Supplement, the Indenture Trustee shall,
not later than 12:00 noon (New York City time), on the Payment Date on which
such amounts are deposited (or, if such date is not a Payment Date, on the
immediately following Payment Date) deposit such amount into the Principal
Funding Account.
(c) Notwithstanding anything to the contrary in this Series Supplement
or the Indenture, the entire amount deposited in the Principal Funding Account
pursuant to Section 7.01 or 8.01 hereof and all other amounts on deposit therein
shall be distributed in full to the Series 200_-_ Noteholders on such date and
any distribution made pursuant to paragraph (b) above shall be deemed to be a
final distribution pursuant to Section 8.4 of the Indenture with respect to the
Series 200_-_ Notes; provided, however, that amounts shall be paid first, to the
Class A Noteholders to the extent due and owing and second, to the Class B
Noteholders.
SECTION 8.02. Disposition of Principal Receivables Pursuant to Section
5.4 of the Indenture.
(a) In accordance with Section 5.4 of the Indenture, in the event that
the aggregate outstanding principal amount of the Class A Notes is greater than
zero on the Class A Stated Maturity Date (after giving effect to deposits and
distributions otherwise to be made on such Class A Stated Maturity Date), upon
receipt of an Opinion of Counsel to the effect that its action will not result
in the Trust being characterized as an association (or a publicly traded
partnership) taxable as a corporation, the Indenture Trustee will sell or cause
to be sold Principal Receivables (or interests therein) in an amount such that
the proceeds of such sale equal the aggregate outstanding
27
<PAGE>
principal balance of, and accrued and unpaid interest on, the Class A Notes on
such Class A Stated Maturity Date (after giving effect to such deposits and
distributions); provided, however, in no event shall such amount exceed the
lesser of (a) the sum of the Invested Amount and the Available Subordinated
Amount on the preceding Determination Date (after giving effect to the
allocations, distributions, withdrawals and deposits to be made on the Payment
Date following such Determination Date) and (b) the Series Allocation Percentage
for Series 200_-_ (for the Collection Period in which such Class A Stated
Maturity Date occurs) of Principal Receivables on such Class A Stated Maturity
Date. The amount of Principal Receivables sold shall first reduce the Class A
Invested Amount, but not to below zero, then any remaining amounts shall reduce
the Available Subordinated Amount, but not to below zero, and then any amounts
still remaining shall reduce the Class B Invested Amount. The net proceeds of
such sale and any Collections on the Principal Receivables will be paid pro rata
to the Class A Noteholders on the Class A Stated Maturity Date as the final
payment of the Class A Notes, and the Class A Noteholders shall not receive any
additional payments with respect to the Class A Notes.
(b) In accordance with Section 5.4 of the Indenture, in the event that
the aggregate outstanding principal balance of the Class B Notes is greater than
zero on the Class B Stated Maturity Date (after giving effect to deposits and
distributions otherwise to be made on such Class B Stated Maturity Date), upon
receipt of an Opinion of Counsel to the effect that its action will not result
in the Trust being characterized as an association (or publicly traded
partnership) taxable as a corporation, the Indenture Trustee will sell or cause
to be sold Principal Receivables (or interests therein) in an amount such that
the net proceeds of such sale equal the aggregate outstanding principal balance
of, and accrued and unpaid interest on, the Class B Notes on such Class B Stated
Maturity Date (after giving effect to such deposits and distributions);
provided, however, in no event shall such amount exceed the lesser of (a) the
sum of the Invested Amount and the Available Subordinated Amount on the
preceding Determination Date (after giving effect to the allocations,
distributions, withdrawals and deposits to be made on the Payment Date following
such Determination Date, including any adjustment as a result of the preceding
paragraph) and (b) the Series Allocation Percentage for Series 200_-_ (for the
Collection Period in which such Class B Stated Maturity Date occurs) of
Principal Receivables on such Class B Stated Maturity Date. The amount of
Receivables sold shall first reduce the Class B Invested Amount, but not to
below zero, then any remaining amounts shall reduce the Available Subordinated
Amount. The net proceeds of such sale and any Collections on the Principal
Receivables will be paid pro rata to the Class B Noteholders on the Class B
Stated Maturity Date as the final payment of the Class B Notes, and the Class B
Noteholders shall not receive any additional payments with respect to the Class
B Notes.
(c) In accordance with Section 5.4 of the Indenture, in the event that
an Event of Default relating to the failure to make any required payment of
interest or principal on the Series 200_-_ Notes has occurred and the Series
200_-_ Notes have been declared due and payable, on the direction of the holders
of a majority of the aggregate outstanding principal amount of the Controlling
Class of the Series 200_-_ Notes, upon receipt of an Opinion of Counsel to the
effect that its action will not result in the Trust being characterized as an
association (or publicly traded
28
<PAGE>
partnership) taxable as a corporation, the Indenture Trustee will sell or cause
to be sold an interest in the Receivable or certain Receivables in an amount
such that the net proceeds of such sale equal the aggregate outstanding
principal balance of, and accrued and unpaid interest on, the Series 200_-_
Notes then outstanding on such date; provided, however, in no event shall such
amount exceed the lesser of (a) the sum of the Invested Amount and the Available
Subordinated Amount on the preceding Determination Date (after giving effect to
the allocations, distributions, withdrawals and deposits to be made prior to
such date); and (b) the Series Allocation Percentage for Series 200_-_ of
Principal Receivables on such date. The net proceeds of such sale will be paid
pro rata to the Class A Noteholders in an amount up to the aggregate outstanding
principal balance of and accrued and unpaid interest on the Class A Notes, and
then, to the extent of funds remaining, to the Class B Noteholders, and the
Series 200_-_ Noteholders shall not receive any additional payments with respect
to the Series 200_-_ Notes.
ARTICLE IX
MISCELLANEOUS PROVISIONS
SECTION 9.01. Ratification of Agreement. As supplemented by this Series
Supplement, the Indenture is in all respects ratified and confirmed and the
Indenture as so supplemented by this Series Supplement shall be read, taken and
construed as one and the same instrument.
SECTION 9.02. Counterparts. This Series Supplement may be executed in
two or more counterparts (and by different parties on separate counterparts)
each of which shall be an original, but all of which together shall constitute
one and the same instrument.
SECTION 9.03. Change in Indenture Trustee. Neither the Servicer nor the
Certificateholders shall appoint a new Indenture Trustee located in any
jurisdiction which does not have in effect the standard UCC provisions relating
to perfection of interests in instruments without delivering an Opinion of
Counsel to Moody's to the effect that such new Indenture Trustee will have a
perfected and first priority interest in any instruments evidencing the
Receivables.
SECTION 9.04. GOVERNING LAW. THIS SERIES SUPPLEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
OR ANY OTHER JURISDICTION'S CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.
29
<PAGE>
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused
this Series Supplement to be duly executed by their respective officers,
thereunto duly authorized, all as of the day and year first above written.
WORLD OMNI MASTER OWNER TRUST
By: Chase Manhattan Bank Delaware, not in
its individual capacity but solely as
Owner Trustee
By:
----------------------------------
Name:
Title:
HARRIS TRUST AND SAVINGS BANK
As Indenture Trustee
By:
----------------------------------
Name: E. Kay Liederman Van Dam
Title: Vice President
Acknowledged and Accepted:
WORLD OMNI FINANCIAL CORP.,
Servicer
By:
--------------------------
Name: Eric M. Gebhard
Title: Assistant Secretary
30
<PAGE>
EXHIBIT A
[FORM OF CLASS A NOTE]
<PAGE>
EXHIBIT B
[FORM OF CLASS B NOTE]
<PAGE>
EXHIBIT C
[FORM OF MONTHLY PAYMENT DATE STATEMENT]
KIRKLAND & ELLIS
Partnerships Including Professional Corporations
Citicorp Center
153 East 53rd Street
New York, New York 10022-4675
(212) 446-4800
March 7, 2000
WODFI LLC
120 N.W. 12th Avenue
Deerfield Beach, FL 33442
Re: WODFI LLC
World Omni Master Owner Trust
Amendment No. 1 to Registration Statement
No. 333-84579
-------------
We have acted as special counsel to WODFI LLC (the
"Transferor"), in connection with the above-mentioned Amendment No. 1 to
Registration Statement on Form S-3 filed with the Securities and Exchange
Commission (together with the exhibits and amendments thereto, the "Registration
Statement") in connection with the registration by the Transferor of certain
Asset Backed Notes (the "Notes") issued by World Omni Master Owner Trust (the
"Trust") and to be sold from time to time in one or more series in amounts to be
determined at the time of sale and to be set forth in one or more supplements
(each, a "Prospectus Supplement") to the Prospectus (the "Prospectus") included
in the Registration Statement.
As described in the Registration Statement, the Notes will be
issued by the Trust. The Trust has also issued Asset Backed Certificates which
are not being offered by the Prospectus. The Trust was formed pursuant to a
Certificate of Trust filed with the Secretary of State of Delaware on November
22, 1999.
In arriving at the opinion expressed below, among other
things, we have examined and relied, to the extent we deem proper, on (i) the
Trust Sale and Servicing Agreement, dated as of November 22, 1999 and the form
of the Amended and Restated Trust Sale and Servicing Agreement to be entered
into between World Omni Financial Corp., the Transferor and the Trust, (ii) the
Trust Agreement, dated as of November 22, 1999 (including the form of
Certificates included as an exhibit thereto) between the Transferor and Chase
Manhattan Bank Delaware, as Owner Trustee, (iii) the Indenture, dated as of
November 22, 1999 and the form of
<PAGE>
WODFI LLC
March 7, 2000
Page 2
Amended and Restated Indenture to be entered into by the Trust and Harris Trust
and Savings Bank, as Indenture Trustee, (iv) the form of Series Supplement to
the Indenture, (v) the form of the Underwriting Agreement to be executed by the
Company and the representative of the several underwriters (the "Underwriters)
to be parties thereto (the "Underwriting Agreement") and (vi) copies of such
other documents as we have deemed necessary for the expression of the opinion
contained herein.
Subject to the assumptions, qualifications, and limitations
identified in this letter, and assuming the aforementioned documents are duly
executed and delivered in substantially the form we have examined, we hereby
advise you that in our opinion after the Requisite Preliminary Actions
identified below have been taken, the Notes will have been validly issued and
will be fully paid and non-assessable and will be binding obligations of the
Trust.
The term "Requisite Preliminary Actions" means: (i) the
Registration Statement becomes effective pursuant to the provisions of the
Securities Act of 1933, as amended, (ii) the amount, price, interest rate or
pass through rate and other principal terms with respect to each series of
registered Notes, the Basic Documents relating thereto have each been duly
completed, executed and delivered by the parties thereto substantially in the
form we have examined, duly reflecting the terms established as described above,
(iii) the Indenture has been duly qualified under the Trust Indenture Act of
1939, as amended, and (iv) with respect to each series of Registered Notes, such
Registered Notes have been duly issued by the Trust and authenticated by the
Indenture Trustee, as applicable, all in accordance with the terms and
conditions of the related Basic Documents and sold by the Transferor in the
manner described in the Registration Statement.
For purposes of this letter, once the Underwriters have paid
for the Notes pursuant to the Underwriting Agreement, the Notes will be
considered "fully paid and nonassessable."
Our advice on every legal issue addressed in this letter is
based exclusively on the internal law of the State of New York. We advise you
that issues addressed by this letter may be governed in whole or in part by
other laws, but we express no opinion as to whether any relevant difference
exists between the laws upon which our opinions are based and any other laws
which may actually govern. For purposes of our opinions, we have assumed without
independent investigation that factual information supplied to us for purposes
of our opinions is complete and accurate.
We consent to the filing of both this letter and the letter
filed as Exhibit 8.1 of the Registration Statement as exhibits to the
Registration Statement and to the reference to this firm under the captions
titled "Summary--Tax Status," "Certain Federal Income Tax Consequences" and
"Legal Opinions" in the prospectus and "Summary--Tax Status" and "Certain
Federal Income Tax Consequences" in the prospectus supplement, each of which is
part of the Registration Statement. In giving this consent, we do not thereby
admit that we come within the category of persons whose consent is required
<PAGE>
WODFI LLC
March 7, 2000
Page 3
under Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission thereunder.
Very truly yours,
/s/ KIRKLAND & ELLIS
-------------------------------
KIRKLAND & ELLIS
KIRKLAND & ELLIS
Partnerships Including Professional Corporations
200 East Randolph Drive
Chicago, Illinois 60601
(312) 861-2000
March 7, 2000
WODFI LLC
120 N.W. 12th Avenue
Deerfield Beach, FL 33442
Re: WODFI LLC
World Omni Master Owner Trust
Amendment No. 1 to Registration Statement
No. 333-84579
-------------
We have acted as special counsel to WODFI LLC, a Delaware
limited liability company (the "Company"), in connection with the
above-mentioned Amendment No. 1 to Registration Statement on Form S-3 filed with
the Securities and Exchange Commission (together with the exhibits and
amendments thereto, the "Registration Statement") in connection with the
registration by the Company of certain Asset Backed Notes (the "Notes") to be
sold from time to time in one or more series in amounts to be determined at the
time of sale and to be set forth in one or more supplements (each, a "Prospectus
Supplement") to the prospectus (the "Prospectus") included in the Registration
Statement.
As described in the Registration Statement, the Notes will be
issued by World Omni Master Owner Trust (the "Master Trust"). The Master Trust
was formed pursuant to a Certificate of Trust filed with the Secretary of State
of Delaware on November 22, 1999. Each series of Notes will be issued pursuant
to the terms of the Indenture in effect on such date and a supplement to the
Indenture (a "Series Supplement").
In arriving at the opinion expressed below, among other
things, we have examined and relied, to the extent we deem proper, on (i) the
Registration Statement, (ii) the Trust Sale and Servicing Agreement, dated as of
November 22, 1999 and the form of Amended and Restated Trust Sale and Servicing
Agreement to be entered into between World Omni Financial Corp., the Company and
the
<PAGE>
WODFI LLC
March 7, 2000
Page 2
Master Trust, (iii) the Trust Agreement, dated as of November 22, 1999
(including the form of Certificates included as an exhibit thereto) between the
Company and Chase Manhattan Bank Delaware, as Owner Trustee, (iv) the Indenture,
dated as of November 22, 1999 and the form of Amended and Restated Indenture to
be entered into by the Master Trust and Harris Trust and Savings Bank, as
Indenture Trustee, (v) the form of Series Supplement to the Indenture and (vi)
copies of such other documents as we have deemed necessary for the expression of
the opinion contained herein.
We have examined and relied, with your permission, as to
factual matters upon the representations and warranties contained in or made
pursuant to the documents referred to above and upon the originals or copies
certified or records of the Company and such other instruments and certificates
of public officials, officers and representatives of the Company and other
persons, and we have made such investigations of law as we have deemed
appropriate. In such examination, we have assumed, with your permission, the
authenticity of all documents submitted to us as originals, the conformity to
the originals of all documents submitted to us as copies, and the authenticity
of the originals of all documents submitted to us as copies. With your
permission, we have further assumed the genuineness of the signatures of persons
signing all documents and instruments and the authority of such persons signing
on behalf of the parties thereto.
In rendering our opinion, we have also considered and relied
upon the Internal Revenue Code of 1986, as amended (the "Code"), administrative
rulings, judicial decisions, regulations, and such other authorities (including
Treasury regulations) as we have deemed appropriate, all as in effect on the
date hereof and all which are subject to change or different interpretation.
However, we will not seek a tax ruling from the Internal Revenue Service (the
"IRS") with respect to any of the matters discussed herein. Moreover, the
statutory provisions, regulations, interpretations and other authorities upon
which our opinion is based are subject to change, and such changes could apply
retroactively. In addition, there can be no assurance that positions contrary to
those stated in our opinion will not be taken by the IRS. Our opinion is in no
way binding on the IRS or any court, and it is possible that the IRS or a court
could, when presented with these facts, reach a different conclusion.
Based on the foregoing, and assuming the aforementioned
documents are duly executed and delivered in substantially the form we have
examined, we are of the opinion that the statements in the
<PAGE>
WODFI LLC
March 7, 2000
Page 3
Prospectus under the headings "Summary--Tax Status" and "Certain Federal Income
Tax Consequences," to the extent that they constitute matters of law or legal
conclusions with respect thereto, have been prepared or reviewed by us and are
correct in all material respects.
Except for the opinion expressed above, we express no opinion
as to any other tax consequences of the transaction to any part under federal,
state, local, or foreign laws. In addition, we express no opinion as to the laws
of any jurisdiction other than the federal laws of the United States of America
to the extent specifically referred to herein.
Very truly yours,
/s/ KIRKLAND & ELLIS
---------------------------------------
KIRKLAND & ELLIS
AMENDED AND RESTATED
TRUST SALE AND SERVICING AGREEMENT
AMONG
WORLD OMNI FINANCIAL CORP.
SERVICER
WODFI LLC
TRANSFEROR
AND
WORLD OMNI MASTER OWNER TRUST
TRUST
DATED AS OF _________ __, 2000
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
ARTICLE I
DEFINITIONS..............................................................................................1
SECTION 1.1 Definitions...............................................................1
ARTICLE II
CONVEYANCE OF RECEIVABLES................................................................................1
SECTION 2.1 Conveyance of Receivables.................................................1
SECTION 2.2 Acceptance by the Owner Trustee. .......................................3
SECTION 2.3 Representations and Warranties of the Transferor Relating to the
Transferor and the Agreement..............................................3
SECTION 2.4 Representations and Warranties of the Transferor Relating to the
Receivables. ...........................................................5
SECTION 2.5 Addition of Accounts. ..................................................7
SECTION 2.6 Covenants of the Transferor..............................................10
SECTION 2.7 Removal of Eligible Accounts. ..........................................10
SECTION 2.8 Removal of Ineligible Accounts. .......................................12
SECTION 2.9 Transfer of Ineligible Receivables.......................................14
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES.............................................................15
SECTION 3.1 Acceptance of Appointment and Other Matters Relating to the
Servicer.................................................................15
SECTION 3.2 Servicing Compensation...................................................17
SECTION 3.3 Representations, Warranties and Covenants of the
Servicer.................................................................17
SECTION 3.4 Reports and Records......................................................20
SECTION 3.5 Annual Servicer's Certificate............................................21
SECTION 3.6 Annual Independent Public Accountants' Servicing
Report...................................................................21
SECTION 3.7 Tax Treatment. .........................................................22
SECTION 3.8 Notices to World Omni. .................................................22
SECTION 3.9 Adjustments. ..........................................................22
SECTION 3.10 Annual Servicing Transfer................................................23
ARTICLE IV
ALLOCATION AND APPLICATION OF COLLECTIONS...............................................................24
SECTION 4.1 [Reserved.]..............................................................24
SECTION 4.2 Establishment of Accounts................................................24
SECTION 4.3 Allocations and Applications of Collections and Other
-i-
<PAGE>
Funds....................................................................25
SECTION 4.4 Excess Principal Collections.............................................26
SECTION 4.5 Excess Funding Account...................................................26
SECTION 4.6 Net Deposits.............................................................27
ARTICLE V
DISTRIBUTIONS AND REPORTS TO SECURITYHOLDERS............................................................27
ARTICLE VI
OTHER MATTERS RELATING TO THE SERVICER..................................................................27
SECTION 6.1 Liability of the Servicer. .............................................27
SECTION 6.2 Merger or Consolidation of, or Assumption of,
the Obligations of the Servicer .........................................27
SECTION 6.3 Limitation on Liability of the Servicer and Others. ....................28
SECTION 6.4 Servicer Indemnification of the Trust,
the Indenture Trustee and the Owner Trustee..............................28
SECTION 6.5 The Servicer Not to Resign...............................................30
SECTION 6.6 Access to the Documentation and Information Regarding the
Receivables. ...........................................................30
SECTION 6.7 Delegation of Duties. ..................................................30
SECTION 6.8 Examination of Records. ................................................30
SECTION 6.9 Additional Expenses. ...................................................30
ARTICLE VII
SERVICING DEFAULTS......................................................................................31
SECTION 7.1 Servicing Defaults.......................................................31
SECTION 7.2 Indenture Trustee to Act; Appointment of Successor. ..................33
SECTION 7.3 Notification to Securityholders..........................................34
SECTION 7.4 Waiver of Past Defaults..................................................34
ARTICLE VIII
MISCELLANEOUS PROVISIONS................................................................................35
SECTION 8.1 Amendment. ............................................................35
SECTION 8.2 No Petition Covenant. ..................................................36
SECTION 8.3 GOVERNING LAW. .........................................................36
SECTION 8.4 Notices. ...............................................................36
SECTION 8.5 Severability of Provisions. ............................................36
SECTION 8.6 Assignment...............................................................36
SECTION 8.7 Further Assurances. ....................................................37
SECTION 8.8 No Waiver; Cumulative Remedies. ........................................37
SECTION 8.9 Counterparts. ..........................................................37
SECTION 8.10 Third-Party Beneficiaries. .............................................37
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SECTION 8.11 Action by Owner Trustee. ...............................................37
SECTION 8.12 Merger and Integration. ................................................37
SECTION 8.13 Headings. ..............................................................37
SECTION 8.14 Effect of Amendment and Restatement......................................37
Exhibit A Form of Assignment of Receivables in Additional Accounts
Exhibit B Form of Annual Servicer's Certificate
Exhibit C Forms of Opinion of Counsel
Exhibit D Form of Reassignment of Receivables in Removed Accounts
APPENDIX A Definitions and Rules of Construction
APPENDIX B Notice Addresses and Procedures
SCHEDULE 1 List of Accounts
SCHEDULE 2 Proceedings
SCHEDULE 3 List of Trust Accounts
</TABLE>
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THIS TRUST SALE AND SERVICING AGREEMENT was originally made as
of November 22, 1999 (the "Original Trust Sale and Servicing Agreement"), and is
amended and restated effective ________ __, 2000, by and among WORLD OMNI
FINANCIAL CORP., a Florida corporation, (the "Servicer"), WODFI LLC, a Delaware
limited liability company, (the "Transferor"), and World Omni Master Owner
Trust, a Delaware business trust (the "Trust").
In consideration of the mutual agreements herein contained,
each party agrees as follows for the benefit of the other parties and for the
benefit of the Certificateholders and the Beneficiaries to the extent provided
herein:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. Certain capitalized terms in this
Agreement are defined in and shall have the respective meanings assigned to them
in Part I of Appendix A to this Agreement. All references herein to "the
Agreement" or "this Agreement" are to this Trust Sale and Servicing Agreement as
it may be amended, supplemented or modified from time to time, the exhibits
hereto and the capitalized terms used herein which are defined in Appendix A,
and all references herein to Articles, Sections and subsections are to Articles,
Sections or subsections of this Agreement unless otherwise specified. The rules
of construction set forth in Part II of Appendix A shall be applicable to this
Agreement.
ARTICLE II
CONVEYANCE OF RECEIVABLES
SECTION 2.1 Conveyance of Receivables. In consideration of the
Issuer's delivery to the Transferor of the Certificate, the Transferor does
hereby sell, transfer, assign, set over and otherwise convey, without recourse
(except as expressly provided herein), to the Trust for the benefit of the
Certificateholders and the other Beneficiaries on the Initial Closing Date, in
the case of the Initial Accounts, and on the applicable Addition Date, in the
case of Additional Accounts, (a) all of its right, title and interest in, to and
under the Receivables in each Account and all Collateral Security with respect
thereto owned by the Transferor at the close of business on the Initial Cut-Off
Date, in the case of the Initial Accounts, and on the applicable Additional
Cut-Off Date, in the case of Additional Accounts, and all monies due or to
become due thereon (including all interest accruing thereon after October 31,
1999, whether paid or payable) and all amounts received with respect thereto and
all proceeds of all of the foregoing (including "proceeds" as defined in Section
9-306 of the UCC as in effect in the applicable jurisdiction where either the
Transferor's or World Omni's chief executive offices or books and records
relating to the Receivables are located, and Recoveries) thereof (including,
with respect to any Purchased Participation Receivables, all of the Transferors
rights, remedies, powers and privileges with respect to such Receivables under
the related participation agreement) and (b) all of the Transferor's rights,
remedies, powers and privileges with respect to such Receivables under the
Receivables Purchase Agreement. As of each Business Day, prior to the earlier of
(i) the occurrence of an Early Amortization Event specified in Section 5.17,
(b), (c), (d)
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or (e) of the Indenture and (ii) the Trust Termination Date, on which
Receivables are created in the Accounts (a "Transfer Date"), the Transferor does
hereby sell, transfer, assign, set over and otherwise convey, without recourse
(except as expressly provided herein), to the Trust for the benefit of the
Certificateholders and the Beneficiaries, all of its right, title and interest
in, to and under the Receivables in each Account (other than any Receivables
created in any Designated Accounts from and after the applicable Removal Date)
and all Collateral Security with respect thereto owned by the Transferor at the
close of business on such Transfer Date and not theretofore conveyed to the
Trust, all monies due or to become due and all amounts received with respect
thereto and all proceeds (including "proceeds" as defined in Section 9-306 of
the UCC as in effect in the applicable jurisdiction, and Recoveries) of all of
the foregoing. Such property, together with all monies on deposit in, and
Eligible Investments credited to, the Collection Account or any Series Account,
any Enhancements and the Collateral Security with respect to the Receivables
shall collectively constitute the assets of the Trust (the "Trust Assets"). The
foregoing sale, transfer, assignment, set-over and conveyance and any subsequent
sales, transfers, assignments, set-overs and conveyances do not constitute, and
are not intended to result in, the creation or an assumption by the Trust, the
Owner Trustee, the Indenture Trustee, any Agent or any Beneficiary of any
obligation of the Servicer, the Transferor, World Omni any other Originator or
any other Person in connection with the Accounts, the Receivables or any
Participation Interest or under any agreement or instrument relating thereto
(including any Participation Agreement), including any obligation to any
Dealers.
In connection with such sales, the Transferor agrees to record
and file, at its own expense, a financing statement on form UCC-1 or any other
applicable form (and continuation statements when applicable) with respect to
the Receivables now existing and hereafter created for the sale of chattel
paper, accounts and general intangibles (as defined in Sections 9-105 and 9-106
of the UCC as in effect in the applicable jurisdiction where either the
Transferor's or World Omni's chief executive offices or books and records
relating to the Receivables are located) meeting the requirements of applicable
law in such manner and in such jurisdictions as are necessary to perfect the
sale and assignment of the Receivables and the Collateral Security to the Trust,
and to deliver a file-stamped copy of such financing statements or other
evidence of such filing to the Owner Trustee on or prior to the Initial Closing
Date, in the case of the Initial Accounts, and (if any additional filing is so
necessary) the applicable Addition Date, in the case of Additional Accounts. The
Owner Trustee shall be under no obligation whatsoever to file such financing
statement, or a continuation statement to such financing statement, or to make
any other filing under the UCC in connection with such sales.
In connection with such sales, the Transferor further agrees,
at its own expense, on or prior to the Initial Closing Date, in the case of the
Initial Accounts, the applicable Addition Date, in the case of Additional
Accounts, and the applicable Removal Date, in the case of Removed Accounts, (a)
to cause the Servicer to indicate in its computer files as required by the
Receivables Purchase Agreement, that the Receivables created in connection with
the Accounts (other than Removed Accounts) have been sold, and the Collateral
Security assigned, to the Transferor in accordance with the Receivables Purchase
Agreement and sold to the Trust pursuant to this Agreement for the benefit of
the Certificateholders and the Beneficiaries and (b) to deliver to the Owner
Trustee and the Indenture Trustee (or cause World Omni to do so) a computer file
or microfiche or written list containing a true and complete list of all such
Accounts
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(other than Removed Accounts) specifying for each such Account, as of the
Initial Cut-Off Date, in the case of the Initial Accounts, and the applicable
Additional Cut-Off Date, in the case of Additional Accounts, (i) its account
number and (ii) the aggregate amount of Principal Receivables in such Account.
Such file or list, as supplemented from time to time to reflect Additional
Accounts and Removed Accounts, shall be marked as Schedule 1 to this Agreement
and is hereby incorporated into and made a part of this Agreement. Neither the
Owner Trustee nor the Indenture Trustee shall be under any obligation whatsoever
to verify the accuracy or completeness of the information contained in Schedule
1 from time to time. In addition, in connection with such sales, the Transferor
shall deliver within 10 days after the Initial Closing Date in the case of the
Initial Accounts or the applicable Addition Date in the case of Additional
Accounts to the Owner Trustee all documents constituting "instruments" (as
defined in the UCC as in effect in the applicable jurisdiction) with such
endorsements attached as the Owner Trustee may reasonably require.
SECTION 2.2 Acceptance by the Owner Trustee. The Owner Trustee
hereby acknowledges its acceptance, on behalf of the Trust, of all right, title
and interest previously held by the Transferor to the property, now existing and
hereafter created, conveyed to the Trust pursuant to Section 2.1 and declares
that it shall maintain such right, title and interest, upon the trust herein set
forth, for the benefit of the Certificateholders and the Beneficiaries. The
Owner Trustee further acknowledges that, prior to or simultaneously with the
execution and delivery of this Agreement, the Transferor delivered to the Owner
Trustee (i) all documents evidencing the Receivables which constitute
"instruments" (as defined in the UCC as in effect in the applicable
jurisdiction) and (ii) the computer file or microfiche or written list relating
to the Initial Accounts described in the last paragraph of Section 2.1.
The Owner Trustee shall have no power to create, assume or
incur indebtedness or other liabilities in the name of the Trust other than as
contemplated in the Basic Documents.
SECTION 2.3 Representations and Warranties of the Transferor
Relating to the Transferor and the Agreement. The Transferor hereby represents
and warrants to the Trust, the Indenture Trustee and to the Owner Trustee as of
each Closing Date that:
(a) Organization and Good Standing. The Transferor is a
limited liability company duly formed and validly existing and in good standing
under the laws of the State of Delaware and has, in all material respects, full
power, authority and legal right to own its properties and conduct its business
as such properties are presently owned and such business is presently conducted,
and to execute, deliver and perform its obligations under this Agreement.
(b) Due Qualification. The Transferor is duly qualified to do
business and, where necessary, is in good standing as a foreign limited
liability company (or is exempt from such requirement) and has obtained all
necessary licenses and approvals in each jurisdiction in which the conduct of
its business requires such qualification except where the failure to so qualify
or obtain licenses or approvals would not have a material adverse effect on its
ability to perform its obligations hereunder.
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(c) Due Authorization. The execution and delivery of this
Agreement and the other Basic Documents and the consummation of the transactions
provided for or contemplated by this Agreement and the other Basic Documents by
the Transferor, have been duly authorized by the Transferor by all necessary
action on the part of the Transferor.
(d) No Conflict. The execution and delivery of this Agreement
and the other Basic Documents, the performance of the transactions contemplated
by this Agreement and the other Basic Documents and the fulfillment of the terms
hereof and thereof, will not conflict with, result in any breach of any of the
material terms and provisions of, or constitute (with or without notice or lapse
of time or both) a material default under, any indenture, contract, agreement,
mortgage, deed of trust, or other instrument to which the Transferor is a party
or by which it or its properties are bound.
(e) No Violation. The execution and delivery of this
Agreement, the other Basic Documents, the performance of the transactions
contemplated by this Agreement and the other Basic Documents and the fulfillment
of the terms hereof and thereof applicable to the Transferor, will not conflict
with or violate any material Requirements of Law applicable to the Transferor.
(f) No Proceedings. There are no proceedings or, to the best
knowledge of the Transferor, investigations pending or threatened against the
Transferor before any Governmental Authority (i) asserting the invalidity of
this Agreement or the other Basic Documents, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement and the
other Basic Documents, (iii) 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 and the
other Basic Documents, (iv) seeking any determination or ruling that would
materially and adversely affect the validity or enforceability of this Agreement
and the other Basic Documents or (v) seeking to affect adversely the income tax
attributes of the Trust under the United States federal, or any other applicable
state, local or foreign jurisdiction's, income, single business or franchise tax
systems.
(g) All Consents Required. All appraisals, authorizations,
consents, orders, approvals or other actions of any Person or of any
governmental body or official required in connection with the execution and
delivery of this Agreement and the other Basic Documents, the performance of the
transactions contemplated by this Agreement and the other Basic Documents, and
the fulfillment of the terms hereof and thereof, have been obtained.
(h) Enforceability. This Agreement and the other Basic
documents each constitutes a legal, valid and binding obligation of the
Transferor enforceable against the Transferor in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect affecting the enforcement of creditors' rights in general and except as
such enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity).
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<PAGE>
(i) Record of Accounts. As of the Initial Closing Date, in the
case of the Initial Accounts, as of the applicable Addition Date, in the case of
the Additional Accounts, and, as of the applicable Removal Date, in the case of
Removed Accounts, Schedule 1 to this Agreement is an accurate and complete
listing in all material respects of all the Accounts as of the Initial Cut-Off
Date, the applicable Additional Cut-Off Date or the applicable Removal Date, as
the case may be, and the information contained therein with respect to the
identity of such Accounts and the Receivables existing thereunder is true and
correct in all material respects as of the Initial Cut-Off Date, such applicable
Additional Cut-Off Date or such Removal Date, as the case may be.
(j) Valid Transfer. This Agreement or, in the case of
Additional Accounts, the related Assignment constitutes a valid sale, transfer
and assignment to the Trust of all right, title and interest of the Transferor
in the related Receivables and the Collateral Security and the proceeds thereof
and all of the Transferor's rights, remedies, powers and privileges with respect
to the Receivables under the Receivables Purchase Agreement and, upon the filing
of the financing statements described in Section 2.1 with the Secretary of State
in the applicable jurisdiction where either the Transferor's or World Omni's
chief executive offices or books and records relating to the Receivables are
located and, in the case of the Additional Receivables hereafter created and the
proceeds thereof, upon the creation thereof, the Trust shall have a first
priority perfected ownership interest in such property, except for Liens
permitted under Section 2.6(a). Except as otherwise provided in this Agreement,
or the other Basic Documents, neither the Transferor nor any Person claiming
through or under the Transferor has any claim to or interest in the Trust
Assets.
The representations and warranties set forth in this Section
2.3 shall survive the transfer and assignment of the Receivables to the Trust.
Upon discovery by the Transferor, the Owner Trustee, the Indenture Trustee, the
Servicer, or any Agent of a breach of any of the foregoing representations and
warranties, the party discovering such breach shall give prompt written notice
to the other parties, any Agent and to any Enhancement Providers.
In the event the Noteholders of a Series shall have exercised
their right to have such Notes redeemed pursuant to Section 10.1(b) of the
Indenture as a result of any breach of any of the representations and warranties
set forth in this Section 2.3, the Transferor shall deposit into the applicable
Principal Funding Account in immediately available funds on the Business Day
preceding the Redemption Date, an amount equal to the sum of the amounts
specified therefor with respect to each outstanding Series in the related Series
Supplement. The obligation of the Transferor to make the deposit specified in
this Section 2.3 will constitute the sole remedy to the Trust, the Noteholders
(the Indenture Trustee on behalf of the Noteholders) or any other Person as a
result of the breach of the representations and warranties set forth in this
Section 2.3.
SECTION 2.4 Representations and Warranties of the Transferor
Relating to the Receivables.
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(a) Representations and Warranties. The Transferor hereby
represents and warrants to the Trust that:
(i) Each Receivable and all Collateral Security
existing on the Initial Closing Date or, in the case of Additional
Accounts, on the applicable Addition Date, and on each Transfer Date,
has been conveyed to the Trust free and clear of any Lien (other than
the Lien held by World Omni subject to Article VII of the Receivables
Purchase Agreement).
(ii) With respect to each Receivable and all
Collateral Security existing on the Initial Closing Date or, in the
case of Additional Accounts, on the applicable Addition Date, and on
each Transfer Date, all consents, licenses, approvals or authorizations
of or registrations or declarations with any Governmental Authority
required to be obtained, effected or given by the Transferor in
connection with the conveyance of such Receivable or Collateral
Security to the Trust have been duly obtained, effected or given and
are in full force and effect.
(iii) On the Initial Cut-Off Date and each Closing
Date, each Initial Account is an Eligible Account and, in the case of
Additional Accounts, on the applicable Additional Cut-Off Date and each
subsequent Closing Date, each such Additional Account is an Eligible
Account.
(iv) On the Initial Closing Date, in the case of the
Initial Accounts, and, in the case of the Additional Accounts, on the
applicable Additional Cut-Off Date, and on each Transfer Date, each
Receivable conveyed to the Trust on such date is an Eligible Receivable
or, if such Receivable is not an Eligible Receivable, such Receivable
is conveyed to the Trust in accordance with Section 2.9.
(b) Notice of Breach. The representations and warranties set
forth in Section 2.4(a) shall survive the transfer and assignment of the
Receivables to the Trust and the pledge to the Indenture Trustee under the
Indenture. Upon discovery by the Transferor, the Owner Trustee, the Indenture
Trustee, the Servicer, or any Agent, of a breach of any of the representations
and warranties set forth in Section 2.4(a) the party discovering such breach
shall give prompt written notice to the other parties and to any Enhancement
Providers.
(c) Reassignment. In the event any representation or warranty
under Section 2.4(a) is not true and correct as of the date specified therein
with respect to any Receivable or Account and such breach has a material adverse
effect on the Noteholders, then, within 30 days (or such longer period as may be
agreed to in writing by the Indenture Trustee) of the earlier to occur of the
discovery of any such event by the Transferor or the Servicer, or receipt by the
Transferor or the Servicer of written notice of any such event given by the
Owner Trustee, the Indenture Trustee, any Agent or any Enhancement Providers,
the Transferor shall accept a reassignment of such Receivable or, in the case of
such an untrue representation or warranty with respect to an Account, all
Receivables in such Account, on the Determination Date immediately succeeding
the day of such discovery or notice on the terms and conditions set forth in the
next
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succeeding paragraph; provided, however, that no such reassignment shall be
required to be made with respect to such Receivable if, by the end of such
30-day period (or such longer period as may be agreed to in writing by the
Indenture Trustee), the breached representation or warranty shall then be true
and correct in all material respects and any material adverse effect caused
thereby shall have been cured.
The Transferor shall accept a reassignment of each such
Receivable by directing the Servicer to deduct, subject to the next sentence,
the principal amount of such Receivables from the Pool Balance on or prior to
the end of the Collection Period in which such reassignment obligation arises.
If, following such deduction, the Pool Balance would be less than the Required
Pool Balance on such date, then not later than 12:00 noon on the day on which
such reassignment occurs, the Transferor shall deposit in the Collection Account
in immediately available funds the amount (the "Transfer Deposit Amount") by
which the Pool Balance would be less than the Required Pool Balance (up to the
principal amount of such Receivables); provided that if the Transfer Deposit
Amount is not deposited as required by this sentence, then the principal amounts
of such Receivables shall only be deducted from the Pool Balance to the extent
that the Pool Balance is not reduced below the Required Pool Balance and the
Receivables the principal amounts of which have not been so deducted shall not
be reassigned to the Transferor and shall remain part of the Trust, it being
understood that the failure to remove Receivables pursuant to this proviso shall
not limit the obligation of the Transferor to deposit the portion of the
Transfer Deposit Amount not so deposited. Upon reassignment of any such
Receivable, but only after payment by the Transferor of the Transfer Deposit
Amount, if any, the Trust shall automatically and without further action be
deemed to sell, transfer, assign, set over and otherwise convey to the
Transferor, without recourse, representation or warranty, all the right, title
and interest of the Trust in and to such Receivable, all Collateral Security and
all moneys due or to become due with respect thereto and all proceeds thereof.
The Owner Trustee shall execute such documents and instruments of transfer or
assignment and take such other actions as shall reasonably be requested by the
Transferor to effect the conveyance of such Receivables pursuant to this Section
2.4. The obligation of the Transferor to accept a reassignment of any such
Receivable and to pay any related Transfer Deposit Amount shall constitute the
sole remedy respecting the event giving rise to such obligation available to the
Trust, the Noteholders (or the Indenture Trustee on behalf of Noteholders) or
any other Person.
SECTION 2.5 Addition of Accounts. Subject to the condition set
forth in this Section 2.5, the Transferor may designate additional accounts to
be included as Accounts (the "Additional Accounts").
(a) Required Addition of Accounts. If, as of the close of
business on the last day of any Collection Period, the Pool Balance on such day
is less than the Required Pool Balance as of the following Payment Date (after
giving effect to the allocations, distributions, withdrawals and deposits to be
made on such Payment Date), then the Transferor shall, within five Business Days
following the end of such Collection Period, designate and transfer to the Trust
the Receivables (and the Collateral Security) of Additional Accounts of the
Transferor to be included as Accounts in a sufficient amount such that after
giving effect to such addition the Pool Balance as of the close of business on
the Addition Date is at least equal to such Required Pool Balance. The failure
of the Transferor to transfer Receivables to the Trust as
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provided in this paragraph solely as a result of the unavailability of a
sufficient amount of Eligible Receivables shall not constitute a breach of this
Agreement; provided, however, that any such failure will nevertheless result in
the occurrence of an Early Amortization Event described in Section 5.17 of the
Indenture. In connection with the designation of any account as an Additional
Account pursuant to this Section 2.5(a), each of the following conditions shall
be satisfied with respect to such addition on or prior to the related Addition
Date:
(i) the Transferor shall have provided the Owner
Trustee, the Indenture Trustee, any Agent, the Rating Agencies and any
Enhancement Providers with a timely Addition Notice;
(ii) such Additional Accounts shall all be Eligible
Accounts;
(iii) the Transferor shall have delivered to the
Owner Trustee a duly executed written assignment (including an
acceptance by the Owner Trustee) in substantially the form of Exhibit A
(the "Assignment") and to the Owner Trustee and the Indenture Trustee
the computer file or microfiche or written list required to be
delivered pursuant to Section 2.1;
(iv) the Transferor shall, to the extent required by
Section 4.3, have deposited in the Collection Account all Collections
with respect to such Additional Accounts since the Additional Cut-Off
Date;
(v) (A) no selection procedures reasonably believed
by the Transferor to be adverse to the interests of the Beneficiaries
shall have been used in selecting such Additional Accounts; (B) the
list of Additional Accounts delivered pursuant to clause (iii) shall be
true and correct in all material respects as of the Additional Cut-Off
Date and (C) as of each of the Notice Date and the Addition Date,
neither World Omni nor the Transferor shall be insolvent nor will
either of them be made insolvent by such transfer nor shall any of them
be aware of any pending insolvency;
(vi) the Rating Agency Condition shall have been
satisfied with respect to such addition;
(vii) the addition of the Receivables arising in such
Additional Accounts shall not result in the occurrence of an Early
Amortization Event or Investment Event;
(viii) the Transferor shall have delivered to the
Owner Trustee, the Indenture Trustee, the Rating Agencies, and any
Enhancement Providers a certificate confirming (A) the items set forth
in paragraphs (ii) through (vii) above and (B) that the Transferor
reasonably believes that the addition of the Receivables arising in
such Additional Accounts will not result in the occurrence of an Early
Amortization Event or Investment Event; and
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(ix) on or before each Addition Date, the Transferor
shall have delivered to the Owner Trustee, the Indenture Trustee, each
applicable Rating Agency and any Enhancement Providers an Opinion of
Counsel with respect to the Receivables in the Additional Accounts
substantially in the form of Exhibit C.
Receivables and Collateral Security from such Additional
Accounts shall be sold to the Trust effective on a date (the "Addition Date")
specified in a written notice provided by the Transferor (or the Servicer on its
behalf) to the Owner Trustee, the Indenture Trustee, the Rating Agencies, any
Agent and any Enhancement Providers specifying the Additional Cut-Off Date and
the Addition Date for such Additional Accounts (the "Addition Notice") on or
before the fifth Business Day but not more than the 30th day prior to the
related Addition Date (the "Notice Date").
The Transferor hereby represents and warrants as of the
applicable Addition Date as to the matters set forth in clause (v) above). Upon
discovery by the Transferor, World Omni, any Agent, the Owner Trustee, the
Indenture Trustee or any Enhancement Providers of a breach of the foregoing
representations and warranties, the party discovering the breach shall give
prompt written notice to the other parties, to any Agent and to any Enhancement
Providers.
(b) Optional Addition of Accounts. The Transferor may from
time to time, at its sole discretion, voluntarily designate Additional Accounts
(other than Purchased Participation Receivables) to be included as Accounts and
transfer to the Trust the Receivables (and the Collateral Security) of such
Additional Accounts. (Additional Accounts designated in accordance with the
provisions described in this Section 2.5(b) are referred to as "Automatic
Additional Accounts".) Unless the Rating Agencies shall otherwise have consented
in writing, neither the number of Automatic Additional Accounts designated with
respect to any calendar quarter shall exceed 15% of the number of Accounts as of
the first day of such calendar quarter, nor shall the number of Automatic
Additional Accounts designated during any calendar year exceed 20% of the number
of Accounts as of the first day of such calendar year. Within 30 days after the
end of any calendar quarter, or such other period as shall be required by the
Rating Agencies, in which Accounts are designated as Automatic Additional
Accounts, the Transferor will deliver to the Owner Trustee and the Indenture
Trustee and each Rating Agency an Opinion of Counsel with respect to the
Automatic Additional Accounts included as Accounts in such quarter, confirming
the validity and perfection of the transfer of such Automatic Additional
Accounts. If such Opinion of Counsel with respect to any Automatic Additional
Accounts is not so delivered, the ability of the Transferor to designate
Automatic Additional Accounts will be suspended until such time as each Rating
Agency otherwise consents in writing. If the Transferor is unable to deliver an
Opinion of Counsel with respect to any Automatic Additional Account, such
inability shall be deemed to be a breach of the representation and warranty with
respect to the Receivables in such Automatic Additional Account, provided that
the cure period for such breach will not exceed 30 days. In connection with the
designation of any account as an Automatic Additional Account pursuant to this
Section 2.5(b), each of the conditions specified in clauses (ii), (iii), (iv),
(v), (vii) and, if required by the Rating Agencies, (ix) of Section 2.5(a) shall
be satisfied with respect to such addition on or prior to the related Addition
Date
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SECTION 2.6 Covenants of the Transferor. The Transferor hereby
covenants that:
(a) No Liens. Except for the conveyances hereunder or as
provided in Section 2.1 of the Indenture, the Transferor will not sell, pledge,
assign or transfer to any other Person, or grant, create, incur, assume or
suffer to exist any Lien on, any Receivable or any Collateral Security, whether
now existing or hereafter created, or any interest therein, or the Transferor's
rights, remedies, powers or privileges with respect to the Receivables under the
Receivables Purchase Agreement (other than the Lien held by World Omni subject
to Article VII of the Receivables Purchase Agreement and Participation
Interests), and the Transferor shall defend the right, title and interest of the
Trust in, to and under the Receivables and the Collateral Security, whether now
existing or hereafter created, and such rights, remedies, powers and privileges,
against all claims of third parties claiming through or under World Omni.
(b) Delivery of Collections. In the event that the Transferor,
World Omni or any Affiliate thereof receives payments in respect of Receivables,
the Transferor and World Omni agree to pay or cause to be paid to the Servicer
or any Successor Servicer all payments received thereby in respect of the
Receivables as soon as practicable after receipt thereof, but in no event later
than two Business Days after the receipt by the Transferor, World Omni or any
Affiliate thereof.
(c) Agreement Matters. If World Omni breaches any of the
covenants in Section 2.5 of the Receivables Purchase Agreement and such breach
has a material adverse effect on the interests of the Securityholders, the
Transferor shall enforce its rights under the Receivables Purchase Agreement
arising from such breach.
(d) Account Allocations. In the event that the Transferor is
unable for any reason to transfer Receivables in an Account to the Trust, then
the Transferor agrees that it shall allocate, after the occurrence of such
event, payments on such Account with respect to the principal balance of such
Account first to the oldest principal balance of such Account and to have such
payments applied as Collections in accordance with the terms of this Agreement.
The parties hereto agree that Non-Principal Receivables, whenever created,
accrued in respect of Principal Receivables which have been conveyed to the
Trust shall continue to be a part of the Trust notwithstanding any cessation of
the transfer of additional Principal Receivables to the Trust and Collections
with respect thereto shall continue to be allocated and paid in accordance with
Section 8.2 of the Indenture.
SECTION 2.7 Removal of Eligible Accounts.
(a) On each Determination Date the Transferor shall have the
right to remove Accounts from the Trust in the manner prescribed in Section
2.7(b).
(b) To remove Accounts, the Transferor (or the Servicer on its
behalf) shall take the following actions and make the following determinations:
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(i) not less than five Business Days prior to the
Removal Commencement Date, furnish to the Owner Trustee, the Indenture
Trustee, any Agent, any Enhancement Providers and the Rating Agencies a
written notice (the "Removal Notice") specifying the Determination Date
(which may be the Determination Date on which such notice is given) on
which removal of one or more Accounts will commence (a "Removal
Commencement Date") and specifying the Accounts the future generated
Receivables of which are not to be transferred to the Trust (the
"Designated Accounts");
(ii) determine on the Removal Commencement Date the
aggregate principal balance of Receivables in respect of each such
Designated Account (the "Designated Balance") and amend Schedule 1 by
delivering to the Owner Trustee a computer file or microfiche or
written list containing a true and complete list of the Removed
Accounts specifying for each such Account, as of the Removal
Commencement Date, its account number, the aggregate amount of
Receivables outstanding in such Account and the Designated Balance;
(iii) from and after such Removal Commencement Date,
cease to transfer to the Trust any and all Receivables arising in such
Designated Accounts;
(iv) from and after such Removal Commencement Date,
allocate all Principal Collections in respect of each such Designated
Account, first to the oldest outstanding principal balance of such
Designated Account, until the Determination Date on which the
Designated Balance with respect to such Designated Account is reduced
to zero (the "Removal Date");
(v) on each Business Day from and after such Removal
Commencement Date to and until the related Removal Date, allocate (A)
to the Trust (to be further allocated pursuant to the terms of this
Agreement), Non-Principal Collections in respect of each Designated
Account for Receivables in all Designated Accounts transferred to the
Trust and (B) to the Transferor the remainder of the Non-Principal
Collections in the Designated Accounts;
(vi) represent and warrant that the removal of the
Eligible Account on any Removal Date shall not, in the reasonable
belief of the Transferor, cause an Early Amortization Event or
Investment Event to occur for any Series or class of Notes;
(vii) represent and warrant that no selection
procedures believed by the Transferor to be adverse to the interests of
the Beneficiaries were utilized in selecting the Designated Accounts;
(viii) represent and warrant that such removal will
not result in a reduction or withdrawal of the rating of any
outstanding Series or class of Notes by any applicable Rating Agency;
and
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(ix) on or before the related Removal Commencement
Date, deliver to the Owner Trustee, the Indenture Trustee, any Agent
and any Enhancement Providers an Officers' Certificate confirming the
items set forth in clauses (vi) through (viii) above and confirming
that the Transferor reasonably believes that the removal of the Removed
Accounts will not result in the occurrence of an Early Amortization
Event or Investment Event; the Owner Trustee and the Indenture Trustee
may conclusively rely on such Officers' Certificate and shall have no
duty to make inquiries with regard to the matters set forth therein and
shall incur no liability in so relying.
No Designated Accounts held by the Trust shall be so removed if such removal
will result in a reduction or withdrawal of the rating of any outstanding Series
or class of Notes by any applicable Rating Agency.
Upon satisfaction of the above conditions, on the Removal Date
with respect to any such Trust Account, the Transferor shall cease to allocate
any Collections therefrom in accordance with this Section and such Designated
Account shall be deemed removed from the Trust for all purposes (a "Removed
Account"). Within five Business Days after the Removal Date, the Owner Trustee
shall deliver to the Transferor a reassignment in substantially the form of
Exhibit D (the "Reassignment"), together with appropriate UCC financing
statements.
SECTION 2.8 Removal of Ineligible Accounts.
(a) On the fifth Business Day after any date on which an
Account becomes an Ineligible Account (such fifth Business Day shall be deemed
to be the Removal Commencement Date) the Transferor shall commence removal of
the Receivable of such Ineligible Account in the manner prescribed for the
removal of Eligible Accounts in Section 2.7(b); provided, however, if an Account
becomes an Ineligible Account other than as a result of the failure to satisfy
(i) clause (b) of the definition of Eligible Account as a result of a failure to
satisfy clause (b) of the definition of Eligible Dealer or (ii) clause (d) of
the definition of Eligible Account, the Transferor shall have the right to
remove Ineligible Accounts from the Trust and (i) repurchase the then existing
Receivables in such Accounts in the manner prescribed in Section 2.8(b) or (ii)
reassign the existing Receivables in such Accounts in the manner prescribed in
Section 2.8(c).
(b) To remove Ineligible Accounts and repurchase the then
existing Receivables in such Accounts, the Transferor (or the Servicer on its
behalf) shall take the following actions and make the following determinations:
(i) not less than five Business Days prior to the
Removal and Repurchase Date (the "Removal and Repurchase Notice Date"),
furnish to the Owner Trustee, the Indenture Trustee, any Agent, any
Enhancement Providers and the Rating Agencies a Removal Notice
specifying the Designated Accounts which are to be removed, and the
then existing Receivables in such Designated Accounts (the "Designated
Receivables") which are to be repurchased from the Trust and the
Determination Date (which may be the Determination Date on which such
notice is given) on which the removal of such Designated Accounts and
the repurchase of such Designated Receivables will occur (a "Removal
and Repurchase Date");
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(ii) on the Removal and Repurchase Date with respect
to such Designated Accounts, amend Schedule 1 by delivering to the
Owner Trustee a computer file or microfiche or written list containing
a true and complete list of the Removed Accounts specifying for each
such Account, as of the Removal and Repurchase Notice Date, its account
number and the aggregate amount of Receivables outstanding in such
Account;
(iii) on the Removal and Repurchase Date deposit into
the Collection Account funds in an amount equal to the aggregate
outstanding balance of the Designated Receivables on such date (the
"Repurchased Receivables Purchase Price"), which funds, notwithstanding
anything in this Agreement to the contrary, will be treated as
Collections;
(iv) represent and warrant that the removal of any
such Ineligible Account and the repurchase of the Receivables then
existing in such Account on any Removal and Repurchase Date shall not
in the reasonable belief of the Transferor, cause an Early Amortization
Event or Investment Event to occur for any Series or class of Notes or
cause the Pool Balance to be less than the Required Pool Balance;
(v) represent and warrant that no selection
procedures believed by the Transferor to be adverse to the interests of
the Beneficiaries were utilized in selecting the Designated Accounts;
(vi) represent and warrant as of the Removal and
Repurchase Date that the list of Removed Accounts delivered pursuant to
clause (ii) above, as of the Removal and Repurchase Date, is true and
complete in all material respects;
(vii) represent and warrant that such removal and
repurchase will not result in a reduction or withdrawal of the rating
of any outstanding Series or class of Notes by the applicable Rating
Agency; and
(viii) on or about the related Removal and Repurchase
Date, deliver to the Owner Trustee, the Indenture Trustee, any Agent
and any Enhancement Providers an Officers' Certificate confirming the
items set forth in clauses (iv) through (vii) above and confirming that
the Transferor reasonably believes that the removal of the Removed
Accounts and the repurchase of the Repurchased Receivables will not
result in the occurrence of an Early Amortization Event or Investment
Event; the Owner Trustee and the Indenture Trustee may conclusively
rely on such Officers' Certificate and shall have no duty to make
inquiries with regard to the matters set forth therein and shall incur
no liability in so relying.
Upon satisfaction of the above conditions, on the Removal and
Repurchase Date for any such Designated Account and Designated Receivables, such
Designated Account shall be deemed removed, and such Designated Receivables
("Repurchased Receivables") shall be deemed repurchased,
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from the Trust for all purposes and the Owner Trustee shall, without further
action, be deemed to sell, transfer, assign, set over and otherwise convey to
the Transferor, effective as of the Removal and Repurchase Date, without
recourse, representation or warranty, all the right, title and interest of the
Trust in and to the Repurchased Receivables, all moneys due and to become due
and all amounts received with respect thereto and all proceeds thereof. Within
five Business Days after the Removal and Repurchase Date, the Owner Trustee
shall deliver to the Transferor a Reassignment, together with appropriate UCC
financing statements.
(c) To remove Ineligible Accounts and reassign the then
existing Receivables in such Accounts ("Automatic Removed Accounts"), the
Transferor (or the Servicer on its behalf) shall take the following actions and
make the following determinations:
(i) on or before the fifth Business Day immediately
preceding the Automatic Removal Date furnish to the Owner Trustee, the
Indenture Trustee, any Agent, any Enhancement Providers and the Rating
Agencies a Removal Notice specifying the Automatic Removed Accounts
which are to be removed and the then existing Receivables in such
Accounts which are to be reassigned from the Trust to the Transferor
and the date on which such removal of Automatic Removed Accounts and
reassignment of such Receivables is to occur (the "Automatic Removal
Date");
(ii) on or prior to the date that is five Business
Days after the Automatic Removal Date, the Transferor shall deliver a
computer file or microfiche or written list containing a true and
complete list of the Automatic Removed Accounts specifying for each
such Account, as of the Removal and Reassignment Date, its account
number and the aggregate amount of Receivables outstanding in such
Account;
(iii) represent and warrant that the list of
Automatic Removal Accounts delivered pursuant to clause (ii), as of the
Automatic Removal Date, is true and complete in all material respects;
and
(iv) if any of the Accounts to be removed is not
liquidated and does not have a zero balance (A) the Rating Agency
Condition shall have been satisfied with respect to such removal and
(B) deliver to the Owner Trustee, the Indenture Trustee, any Agent and
any Enhancement Providers an Officers' Certificate, dated the Automatic
Removal Date, confirming that such removal will not cause an Early
Amortization Event or Investment Event to occur for any Series or class
of Notes.
SECTION 2.9 Transfer of Ineligible Receivables. The Transferor
shall sell to the Trust on each Transfer Date any and all Receivables arising in
any Eligible Accounts that are Ineligible Receivables, provided that (a) on the
Initial Cut-Off Date or, in the case of Receivables arising in Additional
Accounts, on the related Additional Cut-Off Date, and on the applicable Transfer
Date, the Account in which such Receivables arise is an Eligible Account and (b)
the Incremental Subordinated Amount is
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adjusted in accordance with the definition of Incremental Subordinated Amount as
defined in the related Series Supplement.
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 3.1 Acceptance of Appointment and Other Matters
Relating to the Servicer.
(a) The Servicer shall service and administer the Receivables,
shall collect payments due under the Receivables and shall charge-off as
uncollectible Receivables, all in accordance with its customary and usual
servicing procedures for servicing wholesale receivables comparable to the
Receivables which the Servicer services for its own account and in accordance
with the Floorplan Financing Guidelines; provided, however, that the Servicer
shall have no responsibility with respect to Non- Serviced Participation
Receivables other than enforcing the rights of the Issuer pursuant to the
Participation Agreement which created such Non-Serviced Participation
Receivables in order to ensure that such Receivable is properly serviced and
that all amounts due to the Issuer under the Participation Agreement are
received. The Servicer shall have full power and authority, acting alone or
through any party properly designated by it hereunder, to do any and all things
in connection with such servicing and administration which it may deem necessary
or desirable. Without limiting the generality of the foregoing and subject to
Section 7.1, the Servicer is hereby authorized and empowered, unless such power
and authority is revoked by the Owner Trustee on account of the occurrence of a
Servicing Default pursuant to Section 7.1, (i) to instruct the Indenture Trustee
to make withdrawals and payments from the Collection Account and any Series
Account as set forth in this Agreement, (ii) to instruct the Owner Trustee to
take any action required or permitted under any Enhancement, (iii) to execute
and deliver, on behalf of the Trust for the benefit of the Certificateholders
and the Beneficiaries, any and all instruments of satisfaction or cancellation,
or of partial or full release or discharge, and all other comparable
instruments, with respect to the Receivables and, after the delinquency of any
Receivable and to the extent permitted under and in compliance with applicable
Requirements of Law, to commence enforcement proceedings with respect to such
Receivables, (iv) to make any filings, reports, notices, applications,
registrations with, and seek any consents or authorizations from, the Securities
and Exchange Commission and any state securities authority on behalf of the
Trust as may be necessary or advisable to comply with any federal or state
securities laws or reporting requirement, and (v) to delegate all or any of its
servicing, collection, enforcement and administrative duties hereunder with
respect to the Accounts and the Receivables to any Person who agrees to conduct
such duties in accordance with the Floorplan Financing Guidelines and this
Agreement; provided, however, that the Servicer shall notify the Owner Trustee,
the Indenture Trustee, the Rating Agencies, any Agent and any Enhancement
Providers in writing of any such delegation of its duties which is not in the
ordinary course of its business, that no delegation will relieve the Servicer of
its liability and responsibility with respect to such duties and that the Rating
Agency Condition shall have been satisfied with respect to any such delegation.
The Owner Trustee shall furnish the Servicer with any powers of
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attorney and other documents reasonably necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties hereunder.
(b) In the event that the Transferor is unable for any reason
to transfer Receivables to the Trust in accordance with the provisions of this
Agreement then, in any such event, the Servicer agrees (i) to give prompt
written notice thereof to the Owner Trustee, the Indenture Trustee, any
Enhancement Providers, any Agent and each Rating Agency and (ii) that it shall
in any such event allocate, after the occurrence of such event, payments on each
Account with respect to the principal balance of such Account first to the
oldest principal balance of such Account, and to have such payments applied as
Collections in accordance with Section 8.2 of the Indenture. The parties hereto
agree that Non-Principal Receivables, whenever created, accrued in respect of
Principal Receivables which have been conveyed to the Trust shall continue to be
a part of the Trust and Trust Assets notwithstanding any cessation of the
transfer of additional Principal Receivables to the Trust, and Collections with
respect to such Principal Receivables and Non-Principal Receivables shall
continue to be allocated and paid to the Trust in accordance with the terms of
this Agreement.
(c) The Servicer shall not, and any Successor Servicer shall
not be obligated to, use separate servicing procedures, offices or employees for
servicing the Receivables from the procedures, offices and employees used by the
Servicer in connection with servicing other wholesale receivables.
(d) The Servicer shall comply with and perform its servicing
obligations with respect to the Accounts and Receivables (other than
Non-Serviced Participation Receivables) in accordance with the Floorplan
Financing Agreements or the Asset Based Lending Financing Agreements relating to
the Accounts and the Floorplan Financing Guidelines, except insofar as any
failure to so comply or perform would not materially and adversely affect the
rights of the Trust or any of the Beneficiaries. Subject to compliance with all
Requirements of Law, the Servicer may change the terms and provisions of the
Floorplan Financing Agreements, the Asset Based Lending Financing Agreements or
the Floorplan Financing Guidelines in any respect (including the calculation of
the amount or the timing of charge-offs and the rate of the finance charge
assessed under these agreements), only if (i) as a result of such change, in the
reasonable judgment of the Servicer, no Early Amortization Event or Investment
Event will occur at any time and none of the Certificateholders or Beneficiaries
shall be materially adversely affected (it being understood that any reduction
in the rate paid by Accounts will not materially adversely affect the
Certificateholders or Beneficiaries if it satisfies the condition in clause
(iii) below), (ii) such change is made applicable to the comparable segment of
wholesale accounts owned or serviced by the Servicer which have characteristics
the same as, or substantially similar to, the Accounts which are the subject of
such change and (iii) in the case of a reduction in the rate of such finance
charges, the Servicer does not reasonably expect any such reduction to result in
the weighted average of the Reference Rates applicable to the Receivables for
any Collection Period being less than the weighted average of the sum of the
Note Rates (in the case of a Series with a fixed Note rate and a swap agreement,
the floating rate payable by the Trust under the swap agreement) and the
Servicing Fee Rates for all outstanding Series for the related Interest Period
(each such term as defined in the related Series Supplement). For purposes of
clause (iii) of the preceding sentence, so long as the Reference Rate is in fact
based on LIBOR or the prime rate of one or
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more banks (which bank or banks may change from time to time), downward
fluctuations in the Reference Rate shall not be deemed to be a reduction in the
rate of such finance charges; provided that a reduction in the margin added to
such Reference Rate to determine the finance charge would be a reduction in such
finance charge.
SECTION 3.2 Servicing Compensation. As full compensation for
its servicing activities hereunder and reimbursement for its expenses as set
forth in the immediately following paragraph, the Servicer shall be entitled to
receive the Servicing Fee on each Payment Date on or prior to the Trust
Termination Date payable in arrears. The "Servicing Fee" shall be the aggregate
of the Monthly Servicing Fees specified in the Series Supplement. The Servicing
Fee shall be payable to the Servicer solely to the extent amounts are available
for payment in accordance with the terms of the applicable Series Supplement.
The Servicer's expenses include the amounts due to the Owner
Trustee pursuant to Section 6.9 of the Trust Agreement and the Indenture Trustee
pursuant to Section 6.7 of the Indenture and the reasonable fees and
disbursements of attorneys, independent accountants and all other expenses
incurred by the Servicer in connection with its activities hereunder, and all
fees and expenses of the Trust not expressly stated herein to be for the account
of the Certificateholders or the Beneficiaries. Except as otherwise provided in
a Series Supplement, the Servicer shall be required to pay such expenses for its
own account, and shall not be entitled to any payment therefor other than the
Servicing Fee. Except as otherwise provided in a Series Supplement, the Servicer
will be solely responsible for all fees and expenses incurred by or on behalf of
the Servicer in connection herewith and the Servicer will not be entitled to any
fee or other payment from, or claim on, any of the Trust Assets (other than the
Servicing Fee).
SECTION 3.3 Representations, Warranties and Covenants of the
Servicer.
(a) World Omni, as Servicer, hereby makes, and any Successor
Servicer by its appointment hereunder shall make, on each Closing Date (and on
the date of any such appointment) the following representations, warranties and
covenants:
(i) Organization and Good Standing. Such party is a
corporation duly organized, validly existing and in good standing under
the applicable laws of the state of its incorporation and has, in all
material respects, full corporate power, authority and legal rights to
own its properties and conduct its wholesale receivable servicing
business as such properties are presently owned and as such business is
presently conducted, and to execute, deliver and perform its
obligations under this Agreement and the applicable Series Supplement.
(ii) Due Qualification. Such party is duly qualified
to do business and is in good standing as a foreign corporation (or is
exempt from such requirements) and has obtained all necessary licenses
and approvals in each jurisdiction in which the servicing of the
Receivables as required by this Agreement requires such qualification,
except where the failure to so qualify or obtain licenses or approvals
would not have a material adverse effect on its ability to perform its
obligations hereunder.
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(iii) Due Authorization. The execution, delivery, and
performance of this Agreement and the applicable Series Supplement has
been duly authorized by such party by all necessary corporate action on
the part thereof.
(iv) Binding Obligation. Each of this Agreement and
each applicable Series Supplement constitutes a legal, valid and
binding obligation of such party, enforceable in accordance with its
terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereinafter in effect, affecting the enforcement of
creditors' rights and except as such enforceability may be limited by
general principles of equity (whether considered in a proceeding at law
or in equity).
(v) No Violation. The execution and delivery of this
Agreement and the applicable Series Supplement by such party, the
performance of the transactions contemplated by this agreement and the
applicable Series Supplement and the fulfillment of the terms hereof
and thereof applicable to such party will not conflict with, violate,
result in any breach of any of the material terms and provisions of, or
constitute (with or without notice or lapse of time or both) a material
default under, any Requirement of Law applicable to such party or any
indenture, contract, agreement, mortgage, deed of trust, or other
instrument to which such party is a party or by which it is bound.
(vi) No Proceedings. Except as provided on Schedule
2, there are no proceedings or, to the best knowledge of such party,
investigations, pending or threatened against such party before any
court, regulatory body, administrative agency or other tribunal or
governmental instrumentality seeking to prevent the consummation of any
of the transactions contemplated by this Agreement and the other Basic
Documents, seeking any determination or ruling that, in the reasonable
judgment of such party, would materially and adversely affect the
performance by such party of its obligations under this Agreement and
the applicable Series Supplement, or seeking any determination or
ruling that would materially and adversely affect the validity or
enforceability of this Agreement and the applicable Series Supplement.
(vii) Compliance with Requirements of Law. Such party
shall duly satisfy all obligations on its part to be fulfilled under or
in connection with the Receivables and the Accounts, will maintain in
effect all qualifications required under Requirements of Law in order
to service properly the Receivables and the Accounts and will comply in
all material respects with all Requirements of Law in connection with
servicing the Receivables and the Accounts the failure to comply with
which would have a material adverse effect on the interests of the
Certificateholders or the Beneficiaries.
(viii) No Rescission or Cancellation. Such party
shall not permit any rescission or cancellation of a Receivable except
as ordered by a court of competent jurisdiction or other Governmental
Authority.
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(ix) Protection of Beneficiaries Rights. Such party
shall not take any action, nor omit to take any action, which action or
omission would impair the rights of Beneficiaries in the Receivables
nor shall it reschedule, revise or defer payments due on any Receivable
except in accordance with the Floorplan Financing Guidelines.
(x) Negative Pledge. Except for the conveyance
hereunder to the Owner Trustee, the pledge to the Indenture Trustee
under the Indenture and the conveyances of Participation Interests
permitted by the Receivables Purchase Agreement, the Servicer will not
sell, pledge, assign or transfer to any other Person, or grant, create,
incur, assume or suffer to exist any Lien on, any Receivable sold and
assigned to the Trust, whether now existing or hereafter created, or
any interest therein, and the Servicer shall defend the rights, title
and interest of the Trust in, to and under any Receivable sold and
assigned to the Trust, whether now existing or hereafter created,
against all claims of third parties claiming through or under the
Transferor or the Servicer.
(b) Notice of Breach. The representations and warranties set
forth in this Section 3.3 shall survive the transfer and assignment of the
Receivables to the Trust and the pledge of the Receivables to the Indenture
Trustee pursuant to the Indenture. Upon discovery by the Transferor, the
Servicer, the Owner Trustee, or the Indenture Trustee of a breach of any of the
representations and warranties set forth in this Section 3.3, the party
discovering such breach shall give prompt written notice to the other parties
and to any Enhancement Providers.
(c) Purchase. In the event any representation or warranty
under Section 3.3(a)(vii), (viii) or (ix) is not true and correct in any
material respect as of the date specified therein with respect to any Receivable
or Account and such breach has a material adverse effect on the value of such
Receivable, then, within 30 days (or such longer period as may be agreed to by
the Owner Trustee) of the earlier to occur of the discovery of any such event by
the Transferor or the Servicer, or receipt by the Transferor or the Servicer of
written notice of any such event given by the Owner Trustee, the Indenture
Trustee or any Enhancement Providers, the Servicer shall purchase such
Receivable or, in the case of an untrue representation with respect to an
Account, all Receivables in such Account, on the Determination Date immediately
succeeding the expiration of such 30-day period on the terms and conditions set
forth in the next succeeding paragraph; provided, however, that no such purchase
shall be required to be made with respect to such Receivable if, by the end of
such 30-day period (or such longer period as may be agreed to by the Owner
Trustee) the breached representation or warranty shall then be true and correct
in all material respects and any material adverse effect caused thereby shall
have been cured. The Servicer shall effect such purchase by depositing in the
Collection Account in immediately available funds an amount equal to the
Purchase Price of such Receivable. Any such deposit of such Purchase Price into
the Collection Account shall be considered a Transfer Deposit Amount and shall
be applied in accordance with the terms of this Agreement.
Upon each such payment of such Purchase Price, the Trust shall
automatically and without further action be deemed to sell, transfer, assign,
set over and otherwise convey to the Servicer, without
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recourse, representation or warranty, all right, title and interest of the Trust
in and to such Receivables, all monies due or to become due with respect thereto
and all proceeds thereof and the Collateral Security. The Owner Trustee shall
execute such documents and instruments of transfer or assignment and take such
other actions as shall be reasonably requested by the Servicer to effect the
conveyance of any such Receivables pursuant to this Section 3.3. The obligation
of the Servicer to purchase such Receivables, and to make the deposits required
to be made to the Collection Account as provided in the preceding paragraph,
shall constitute the sole remedy respecting the event giving rise to such
obligation available to the Trust, the Certificateholders (or the Owner Trustee
on behalf of the Certificateholders) or the Noteholders (or the Indenture
Trustee on behalf of the Noteholders).
SECTION 3.4 Reports and Records.
(a) On or before each Payment Date, with respect to each
outstanding Series, the Servicer shall deliver to any Enhancement Providers, the
Rating Agencies, the Owner Trustee, and the Indenture Trustee a Payment Date
Statement for such Payment Date substantially in the form set forth in the
Series Supplement for that Series of Notes. Each such statement to be delivered
to Securityholders shall set forth the following information concerning the
Notes with respect to such Payment Date or the preceding Collection Period:
(i) the total amount distributed to the Noteholders;
(ii) the amount, if any, of the distribution
allocable to principal on each Series or class of Notes;
(iii) the amount, if any, of the distribution
allocable to interest on or with respect to each Series or class of
Notes;
(iv) the aggregate Outstanding Amount for each Series
or class of Notes, each as of such date and after giving effect to all
payments reported under clause (i) above;
(v) the amount of the Monthly Servicing Fee paid to
the Servicer with respect to the related Collection Period or Periods,
as the case may be;
(vi) the per annum interest rate for the next Payment
Date for any Series or class of Securities with a variable or
adjustable interest rate, if determinable prior to such date;
(vii) the amount of Receivables that become Defaulted
Receivables during the related Collection Period;
(viii) the accumulated interest and principal
shortfalls, if any, on each Series or class of Notes and the change in
each of such amounts from the preceding Payment Date;
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(ix) the balance of Excess Funding Account on the
last day of the related Collection Period after giving effect to
changes therein or any distributions therefrom on such date; and
(x) with respect to each Series of Notes, the items
set forth in the applicable Series Supplement.
Each amount set forth pursuant to clauses (i) and (ii) above with respect to the
Notes shall be expressed as a dollar amount per $1,000 of initial principal
amount of the Notes.
(b) Within the prescribed period of time for tax reporting
purposes after the end of each calendar year during the term of this Agreement,
the Indenture Trustee shall furnish (or cause to be furnished), to each Person
who at any time during such calendar year shall have been a Holder of record of
Notes or Certificates, respectively, and received any payment thereon, a
statement containing such information as may be required by the Code and
applicable Treasury Regulations to enable such Securityholder to prepare its
federal income tax returns.
(c) On or before each Advance Date or Pay Down Date, with
respect to each outstanding Series, the Servicer shall deliver to any
Enhancement Providers, the Rating Agencies, the Owner Trustee, and the Indenture
Trustee a Reset Date Statement for the related Reset Date substantially in the
form set forth in the Series Supplement for that Series of Notes.
(d) A copy of each statement provided pursuant to Section
3.4(a) shall be made available for inspection at the Corporate Trust Office.
SECTION 3.5 Annual Servicer's Certificate. The Servicer will
deliver to the Rating Agencies, the Owner Trustee, the Indenture Trustee, any
Agent and any Enhancement Providers on or before April 30 of each calendar year,
beginning with April 30, 2000, an Officers' Certificate substantially in the
form of Exhibit B stating that (a) a review of the activities of the Servicer
during the preceding calendar year and of its performance under this Agreement
was made under the supervision of the officer signing such certificate and (b)
to the best of such officer's knowledge, based on such review, the Servicer has
performed in all material respects its obligations under this Agreement
throughout such year, or, if there has been a material default in the
performance of any such obligation, specifying each such default known to such
officer and the nature and status thereof. A copy of such certificate may be
obtained by any Securityholder by a request in writing to the Owner Trustee
addressed to the Corporate Trust Office.
SECTION 3.6 Annual Independent Public Accountants' Servicing
Report. The Servicer shall cause a firm of independent certified public
accountants, who may also render other services to the Servicer or to the
Transferor, to deliver to the Owner Trustee, the Indenture Trustee, the Rating
Agencies, each Agent and each Enhancement Provider on or before April 30 of each
year, beginning April 30, 2000, a report addressed to the board of directors of
the Servicer and to the Owner Trustee and the Indenture Trustee, to the effect
that such firm has examined the financial statements of the Servicer and issued
its
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report thereon and that: (a) such examination was made in accordance with
generally accepted auditing standards, and accordingly included such tests of
the accounting records and such other auditing procedures as such firm
considered necessary in the circumstances, (b) as a part of such examination,
certain documents and records of the Servicer relating to the servicing of
wholesale receivables (including financing arrangements with automobile dealers
to finance their automobile and light-duty truck inventory) were reviewed and
tested and (c) nothing came to the attention of such firm that caused them to
believe that the provisions of this Agreement were not being complied with,
except for (i) such exceptions as such firm shall believe to be immaterial and
(ii) such other exceptions as shall be set forth in such statement. A copy of
such report may be obtained by any Securityholder by a request in writing to the
Owner Trustee addressed to the Corporate Trust Office.
SECTION 3.7 Tax Treatment. The Transferor has entered into
this Agreement and the Notes have been (or will be) issued with the intention
that the Notes will qualify under applicable tax law as indebtedness secured by
the Receivables. The Transferor, each Beneficiary, each Certificate Owner and
Note Owner, by the acceptance of its Note or Book-Entry Note, as applicable,
agrees to treat the Notes as indebtedness secured by the Receivables for federal
income taxes, and any other income, franchise taxes, or any other taxes imposed
on or measured by income of any applicable state, local or foreign jurisdiction.
SECTION 3.8 Notices to World Omni. In the event World Omni is
no longer acting as Servicer, any Successor Servicer appointed pursuant to
Section 7.2 shall deliver or make available to World Omni, as the case may be,
each certificate and report required to be prepared, forwarded or delivered
thereafter pursuant to Sections 3.4, 3.5 or 3.6.
SECTION 3.9 Adjustments.
(a) If the Servicer adjusts downward the amount of any
Principal Receivable because of a rebate, refund, credit adjustment or billing
error to a Dealer, or because such Receivable was created in respect of a
Vehicle which was refused or returned by a Dealer, then, in any such case, the
Pool Balance will be automatically reduced by the amount of the adjustment.
Furthermore, if following such a reductions the Pool Balance would be less than
the Minimum Required Pool Balance on such day, then the Transferor shall be
required to pay an amount equal to such deficiency (up to the amount of such
adjustment) into the Collection Account within five Business Days after the day
on which such adjustment or reduction occurs (each such payment an "Adjustment
Payment").
(b) If (i) the Servicer makes a deposit into the Collection
Account in respect of a Collection of a Receivable and such Collection was
received by the Servicer in the form of a check which is not honored for any
reason or (ii) the Servicer makes a mistake with respect to the amount of any
Collection and deposits an amount that is less than or more than the actual
amount of such Collection, the Servicer shall appropriately adjust the amount
subsequently deposited into the Collection Account to reflect such dishonored
check or mistake. Any Receivable in respect of which a dishonored check is
received shall be deemed not to have been paid.
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(c) If the Servicer adjusts downward the amount of interest
otherwise payable on any Receivable with respect to any Collection Period as a
result of any interest rebate program, the Servicer shall deposit into the
Collection Account on or prior to the Payment Date related to such Collection
Period an amount equal to the amount of such rebate (each such payment, a
"Rebate Payment").
SECTION 3.10 Annual Servicing Transfer.
(a) At the close of business on the last Business Day of the
Servicer of each year (each, an "Annual Transfer Date"), beginning December
1999, and for so long as the State of Florida imposes a value-based intangibles
tax on all intangibles owned, managed or controlled by Florida domiciliaries or
intangibles having a business situs in the State of Florida, the Servicer shall
transfer all of its rights, obligations and duties hereunder to WOWI, which
shall agree to perform, until the commencement of business on the first Business
Day of the next succeeding year (the "Annual Retransfer Date"), all of the
duties and obligations of the Servicer hereunder (such transfer, the "Annual
Servicing Transfer"). On the Annual Transfer Date, the Servicer, WOWI, the
Transferor, the Owner Trustee and the Indenture Trustee shall execute and
deliver an annual transfer agreement (each, an "Annual Transfer Agreement") to
be effective on the Annual Transfer Date, pursuant to which WOWI will agree to
act as Servicer hereunder until the Annual Retransfer Date designated therein,
at which time all of the duties and obligations of WOWI as Servicer hereunder
shall terminate until the next Annual Servicing Transfer and World Omni (or a
successor Servicer, if one has been appointed in accordance with Section 7.2)
shall be reinstated as the Servicer hereunder.
(b) Pursuant to each such Annual Transfer Agreement, the
Transferor shall agree on the Annual Transfer Date to transfer to WOWI 99% of
its right, title and interest in, to and under the Certificates owned by the
Transferor as of such day, together with all of its duties, rights and
obligations under this Agreement. The Transferor shall make such transfer to
WOWI in exchange for a promissory note of WOWI made payable to the order of the
Transferor for such amount, and each such promissory note shall be held in
escrow by the Indenture Trustee for the benefit of the Transferor. Pursuant to
each Annual Transfer Agreement, (i) WOWI shall agree to retransfer to the
Transferor on the Annual Retransfer Date all of its right, title and interest
in, to and under the Certificates transferred to WOWI by the Transferor pursuant
to the Annual Transfer Agreement, together with all of its duties, rights and
obligations under this Agreement and (ii) the Indenture Trustee, as escrow agent
on behalf of the Transferor, shall agree to release such promissory note to WOWI
upon confirmation of such retransfer. In the event WOWI does not fulfill its
obligations to retransfer such Certificates and such duties, rights and
obligations on any Annual Retransfer Date, the Indenture Trustee shall be
authorized pursuant to the Annual Transfer Agreement to demand payment from WOWI
for payment to the Transferor.
(c) In furtherance of the transactions described in
subsections (a) and (b) above, World Omni agrees that it will not perform any of
its duties and obligations under the Floorplan Financing Agreements, Asset Based
Lending Financing Agreements or Floorplan Financing Guidelines, or perform
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any activity in connection with this Agreement or the Receivables Purchase
Agreement, during the period from the close of business on the Annual Transfer
Date to the opening of business on the Annual Retransfer Date and agrees to
transfer all such duties and obligations to WOWI during such period.
ARTICLE IV
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.1 [Reserved.].
SECTION 4.2 Establishment of Accounts.
(a) The Servicer, for the benefit of the Securityholders and
any Enhancement Providers, shall cause to be established and maintained in the
name of the Indenture Trustee an Eligible Deposit Account bearing a designation
clearly indicating that the funds deposited therein are held for the benefit of
the Securityholders and any Enhancement Providers (the "Collection Account").
(b) The Servicer, for the benefit of the Securityholders and
the Enhancement Providers shall cause to be established and maintained in the
name of the Indenture Trustee an Eligible Deposit Account bearing a designation
clearly indicating that the funds deposited therein are held for the benefit of
the Securityholders and any Enhancement Providers (the "Excess Funding
Account").
(c) The Indenture Trustee shall possess all right, title and
interest in all funds from time to time on deposit in, and all Eligible
Investments credited to, the Trust Accounts and in all proceeds thereof. The
Trust Accounts shall be under the sole dominion and control of the Indenture
Trustee for the benefit of the Securityholders and any Enhancement Providers.
If, at any time, any Trust Account ceases to be an Eligible Deposit Account, the
Servicer, within 10 Business Days (or such longer period, not to exceed thirty
calendar days, as to which each Rating Agency may consent) of determining or
receiving notice from the Indenture Trustee that any Trust Account is no longer
an Eligible Deposit Account, shall establish a substitute Eligible Deposit
Account as such Trust Account, instruct the Indenture Trustee or the Trust as
applicable, in writing, to transfer any cash and/or any Eligible Investments to
such new Trust Account and, from the date any such substitute account is
established, such account shall be the Trust Account. Neither the Transferor nor
the Servicer, nor any person or entity claiming by, through or under the
Transferor or Servicer, shall have any right, title or interest in, or any right
to withdraw any amount from, the Trust Accounts. Pursuant to the authority
granted to the Servicer in Section 3.1, the Servicer shall have the power,
revocable by the Indenture Trustee (or by the Owner Trustee with the written
consent of the Indenture Trustee), to instruct the Indenture Trustee or the
Trust as applicable, to make withdrawals and payments from the Trust Accounts
for the purposes of carrying out the Servicer's or the Trust's duties specified
in this Agreement or permitting the Indenture Trustee to carry out its duties
under the Indenture.
All Eligible Investments shall be held by the Indenture
Trustee or the Owner Trustee as applicable, for the benefit of the
Securityholders and any Enhancement Providers. Funds on deposit in the
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Trust Accounts shall at the written direction of the Servicer be invested by the
Indenture Trustee or the Owner Trustee as applicable, solely in Eligible
Investments that will mature so that such funds will be available at the close
of business on or before the Business Day prior to the next Payment Date (or on
or before 10:00 a.m. on such following Payment Date in the case of Eligible
Investments in respect of which the Indenture Trustee is the obligor or Eligible
Investments specified in clauses (h) or (j) of the definition thereof). Unless
otherwise specified in the related Series Supplement, all interest and other
investment earnings (net of losses and investment expenses) on funds on deposit
in each Trust Account shall be credited to the Trust Account when received;
provided, however, that all such interest and other investment earnings on funds
on deposit in the Excess Funding Account shall be credited to the Collection
Account and shall be Investment Proceeds when so deposited. Schedule 3, which is
hereby incorporated into and made part of this Agreement, identifies the Trust
Accounts by setting forth the account numbers of each account, the account
designation of each account and the name of the Institution with which such
accounts have been established. If a substitute Trust Account is established
pursuant to this Section 4.2, the Servicer shall provide to the Owner Trustee
and the Indenture Trustee an amended Schedule 3, setting forth the relevant
information for such substitute Trust Account. In the absence of timely and
specific written investment direction from the Servicer, the Indenture Trustee
shall invest any cash held by it in Eligible Investments specified in clause (h)
of the definition thereof. In no event shall the Indenture Trustee be liable for
the selection of investments or for investment losses incurred thereon. The
Indenture Trustee shall have no liability in respect of losses incurred as a
result of the liquidation of any investment prior to its stated maturity or the
failure of the Servicer to provide timely written investment direction.
SECTION 4.3 Allocations and Applications of Collections and
Other Funds.
(a) Except as otherwise provided in Section 4.3(b) and (c),
the Servicer shall deposit Collections into the Collection Account as promptly
as possible after the Date of Processing of such Collections, but in no event
later than the second Business Day after such Date of Processing.
(b) Notwithstanding anything in this Agreement to the
contrary, for so long as (i) World Omni remains the Servicer hereunder, (ii) no
Servicing Default has occurred and is continuing and (iii) World Omni either (x)
maintains a short-term debt rating of at least A-1 by Standard & Poor's and P-1
by Moody's (and for five Business Days following any reduction of either such
rating), (y) arranges for and maintains a letter of credit or other form of
Enhancement in respect of the Servicer's obligations to make deposits of
collections on the Receivables in the Collection Account that is acceptable in
form and substance to each Rating Agency and any Agents or (z) otherwise obtains
the Rating Agency confirmations described below, then, subject to any
limitations in the confirmations described below, the Servicer need not make the
daily deposits of Collections into the Collection Account as provided in Section
4.2, but may make a single deposit into the Collection Account in the same-day
or next-day funds not later than 12:00 noon, New York City time, on the Business
Day immediately preceding the Payment Date in a net amount equal to the amount
which would have been on deposit with respect to the immediately preceding
Collection Period in the Collection Account; provided, however, that prior to
ceasing daily deposits as described above the Servicer shall have delivered to
the Indenture Trustee and the Owner Trustee written
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confirmation from each of the Rating Agencies that the failure by World Omni to
make daily deposits will not result in a reduction or withdrawal of the rating
of any outstanding Series or class.
(c) Subject to Section 4.4, but notwithstanding anything else
in this Agreement to the contrary, (i) the Servicer will only be required to
deposit Collections into the Collection Account as set forth in paragraph (a)
above up to the aggregate amount of Collections required to be deposited into
any Series Account or, without duplication, distributed on the related Payment
Date (whether or not such funds will be distributed to Noteholders, retained in
the Collection Account or deposited in another account on such Payment Date) to
Noteholders, to any Agent or to any Enhancement Provider pursuant to the terms
of any Series Supplement or Enhancement Agreement with respect to the related
Collection Period and (ii) if at any time prior to such Payment Date the amount
of Collections deposited in the Collection Account exceeds the amount required
to be deposited pursuant to clause (i) above, the Servicer will be permitted to
withdraw the excess from the Collection Account.
(d) Collections, Defaulted Amounts and Miscellaneous Payments
will be allocated to each Series as set forth in the applicable Series
Supplement.
SECTION 4.4 Excess Principal Collections. On each day, the
Servicer shall allocate Excess Principal Collections to each Series to cover
Principal Shortfalls as set forth in the related Series Supplement. To the
extent that Excess Principal Collections exceed Principal Shortfalls, the
Servicer shall instruct the Indenture Trustee in writing to withdraw such amount
from the Collection Account and, first, shall deposit an amount therefrom into
the Excess Funding Account such that the Pool Balance is not less than the
Required Pool Balance, and second, shall pay any remaining amounts to the
Certificateholders as provided in the Trust Agreement or, to the extent
requested by the Certificateholders, deposit such amounts into the Excess
Funding Account.
SECTION 4.5 Excess Funding Account.
(a) In addition to any other amounts permitted or required to
be deposited into the Excess Funding Account pursuant to the Basic Documents, at
the direction of the Certificateholders to the Servicer, Owner Trustee and
Indenture Trustee, any amounts otherwise distributable to the Certificateholders
pursuant to the terms of this Agreement, the Indenture (including any Series
Supplement) and the Trust Agreement, shall be deposited into the Excess Funding
Account.
(b) The net proceeds from the issuance of any new Series of
Notes or any increase in the principal amount of any Series of Notes shall be
deposited into the Excess Funding Account in an amount equal to the excess of
the Required Pool Balance over the Pool Balance. The remainder of such funds may
be distributed to the Certificateholders as provided in the Trust Agreement or,
to the extent requested by the Certificateholders, deposited into the Excess
Funding Account.
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(c) Unless an Early Amortization Event shall have occurred,
amounts on deposit in the Excess Funding Account may be used to repay the
outstanding principal amount of any Series of Notes to the extent required or
permitted by the terms of the related Series Supplement.
(d) At the request of the Certificateholders any amount held
in the Excess Funding Account in excess of the amount required so that the Pool
Balance is not less than the Required Pool Balance shall be paid to the
Certificateholders at the time and to the extent requested by the
Certificateholders; provided, however, that any amounts on deposit in the Excess
Funding Account at any time during which any Series is in its Early Amortization
Period, Accumulation Period, Controlled Amortization Period, Amortization Period
or Investment Period shall be deemed to be a Series Allocable Miscellaneous
Payment and shall be allocated and distributed in accordance with the Series
Supplement.
SECTION 4.6 Net Deposits. The Servicer, the Transferor, the
Indenture Trustee and the Owner Trustee may make any remittances pursuant to
this Article IV net of amounts to be distributed by the applicable recipient to
such remitting party. Nonetheless, each such party shall account for all of the
above described remittances and distributions as if the amounts were deposited
and/or transferred separately.
ARTICLE V
DISTRIBUTIONS AND REPORTS TO SECURITYHOLDERS
Distributions shall be made to, and reports shall be provided to, the
Securityholders as set forth in the Indenture, the Trust Agreement and the
applicable Series Supplement.
ARTICLE VI
OTHER MATTERS RELATING TO THE SERVICER
SECTION 6.1 Liability of the Servicer. The Servicer shall be
liable under this Article VI only to the extent of the obligations specifically
undertaken by the Servicer in its capacity as Servicer.
SECTION 6.2 Merger or Consolidation of, or Assumption of, the
Obligations of the Servicer. The Servicer shall not consolidate with or merge
into any other corporation or convey or transfer its properties and assets
substantially as an entirety to any Person, unless:
(a) the corporation formed by such consolidation or into which
the Servicer is merged or the Person which acquires by conveyance or transfer
the properties and assets of the Servicer substantially as an entirety shall be
a corporation organized and existing under the laws of the United States of
America or any state or the District of Columbia and, if the Servicer is not the
surviving entity, such
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corporation shall assume, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, the performance of every
covenant and obligation of the Servicer hereunder; and
(b) the Servicer has delivered to the Owner Trustee and the
Indenture Trustee an Officers' Certificate and an Opinion of Counsel each
stating that such consolidation, merger, conveyance or transfer will comply with
this Section 6.2 and that all conditions precedent herein provided for relating
to such transaction have been complied with.
SECTION 6.3 Limitation on Liability of the Servicer and
Others.
(a) Except as provided in Section 6.4, neither the Servicer
nor any of the directors or officers or employees or agents of the Servicer,
shall be under any liability to the Trust, the Owner Trustee, the Indenture
Trustee, the Securityholders, Enhancement Providers, Agent or any other Person
for any action taken or for refraining from the taking of any action in its
capacity as Servicer pursuant to this Agreement; provided, however, that this
provision shall not protect the Servicer or any such person against any
liability which would otherwise be imposed by reason of wilful misfeasance, bad
faith or negligence in the performance of duties or by reason of reckless
disregard of obligations and duties hereunder. The Servicer and any director or
officer or employee or agent of the Servicer may rely in good faith on any
document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Receivables in accordance with this
Agreement which in its reasonable opinion may involve it in any expense or
liability.
(b) Except as provided in this Agreement, the Servicer shall
not be under any obligation to appear in, prosecute or defend any legal action
that is not incidental to its duties to service the Receivables in accordance
with this Agreement and that in its opinion may involve it in any expense or
liability; provided, however, that the Servicer may undertake any reasonable
action that it may deem necessary or desirable in respect of this Agreement and
the rights and duties of the parties to this Agreement and the interests of the
Noteholders and the Certificateholders under this Agreement, the interests of
the Noteholders under the Indenture and the interests of the Certificateholders
under the Trust Agreement.
SECTION 6.4 Servicer Indemnification of the Trust, the
Indenture Trustee and the Owner Trustee.
(a) The Servicer out of its own funds shall indemnify, defend
and hold harmless the Trust, for the benefit of the Certificateholders, the
Beneficiaries, the Owners Trustee and the Indenture Trustee, and their
respective officers, directors, employees and agents, from and against any taxes
that may at any time be asserted against any such Person with respect to the
transactions contemplated in this Agreement, including, without limitation, any
sales, gross receipts, general corporation, tangible personal property,
privilege or license taxes (but not including any taxes asserted with respect
to, or arising out of, (i) the sale of any Eligible Receivables to the Trust
hereunder, (ii) the issuance and original sale of any
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Securities, (iii) ownership or sale of any Eligible Receivables in the Accounts
in the Pool of Accounts or the Securities, (iv) distributions or the receipt of
payment on the Securities or (v) any fees or other compensation payable to any
such Person) and costs and expenses in defending against the same.
(b) The Servicer out of its own funds shall indemnify and hold
harmless the Trust, for the benefit of the Certificateholders and the
Beneficiaries, the Owner Trustee and the Indenture Trustee, and their respective
officers, directors, employees and agents, from and against any loss, liability,
expense, damage or injury suffered or sustained by reason of any acts, omissions
or alleged acts or omissions arising out of activities of the Servicer pursuant
to this Agreement; provided, however, that the Servicer shall not indemnify if
such acts, omissions or alleged acts or omissions constitute fraud, gross
negligence, breach of fiduciary duty or wilful misconduct by the Owner Trustee
or the Indenture Trustee; and provided further that the Servicer shall not
indemnify for any liabilities, cost or expense of the Trust with respect to any
action taken by the Owner Trustee at the request of the Certificateholders or
any Beneficiaries to the extent the Owner Trustee is fully indemnified by such
Certificateholders or Beneficiaries with respect to such action.
(c) The Servicer out of its own funds shall indemnify, defend
and hold harmless the Indenture Trustee and the Owner Trustee, and their
respective officers, directors, employees and agents, from and against any loss,
liability, expense, damage or injury arising out of or incurred in connection
with (x) in the case of the Indenture Trustee, the Indenture Trustee's
performance of its duties under the Indenture, (y) in the case of the Owner
Trustee, the Owner Trustee's performance of its duties under the Trust Agreement
or (z) the acceptance, administration or performance by, or action or inaction
of, the Indenture Trustee or the Owner Trustee, as applicable, of the trusts and
duties contained in the Basic Documents, except in each case to the extent that
such cost, expense, loss, claim, damage or liability: (A) is due to the wilful
misfeasance, bad faith or negligence (except for errors in judgment) of the
Person seeking to be indemnified, (B) to the extent otherwise payable to the
Indenture Trustee, arises from the Indenture Trustee's breach of any of its
representations or warranties in Section 6.13 of the Indenture, (C) to the
extent otherwise payable to the Owner Trustee, arises from the Owner Trustee's
breach of any of its representations or warranties set forth in Section 6.6 of
the Trust Agreement or (D) shall arise out of or be incurred in connection with
the performance by the Indenture Trustee of the duties of successor Servicer
hereunder.
(d) Indemnification under this Section 6.4 shall include,
without limitation, any judgment, award, settlement, reasonable attorneys' fees
and expenses and other costs or expenses as incurred in connection with the
defense of any actual or threatened action, proceeding or claim; provided,
however, that if the Servicer has made any indemnity payments pursuant to this
Section 6.4 and the recipient thereafter collects any of such amounts from
others, the recipient shall promptly repay such amounts collected to the
Servicer, without interest.
(e) Any indemnification under this Section 6.4 shall survive
the termination of this Agreement and the resignation and removal of the Owner
Trustee or the Indenture Trustee.
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SECTION 6.5 The Servicer Not to Resign. The Servicer shall not
resign from the obligations and duties hereby imposed on it except (a) upon
determination that (i) the performance of its duties hereunder is no longer
permissible under applicable law and (ii) there is no reasonable action which
the Servicer could take to make the performance of its duties hereunder
permissible under applicable law or (b) the Rating Agency Condition is satisfied
with respect thereto. Any such determination permitting the resignation of the
Servicer shall be evidenced as to clause (a) above by an Opinion of Counsel to
such effect delivered to the Owner Trustee and the Indenture Trustee. No such
resignation shall become effective until the Indenture Trustee or a Successor
Servicer shall have assumed the responsibilities and obligations of the Servicer
in accordance with Section 7.2 hereof. If the Indenture Trustee is unable within
120 days of the date of such determination to appoint a Successor Servicer, the
Indenture Trustee shall serve as Successor Servicer hereunder.
SECTION 6.6 Access to the Documentation and Information
Regarding the Receivables. The Servicer shall provide to the Owner Trustee and
the Indenture Trustee access to any and all documentation regarding the Accounts
and the Receivables in such cases where the Owner Trustee and the Indenture
Trustee are required in connection with the enforcement of the rights of the
Securityholders, or by applicable statutes or regulations to review such
documentation, such access being afforded without charge but only (a) upon
reasonable request, (b) during normal business hours, (c) subject to the
Servicer's normal security and confidentiality procedures and (d) at offices
designated by the Servicer. Nothing in this Section 6.6 shall derogate from the
obligation of the Transferor, the Owner Trustee, the Indenture Trustee or the
Servicer to observe any applicable law prohibiting disclosure of information
regarding the Dealers and the failure of the Servicer to provide access as
provided in this Section 6.6 as a result of such obligation shall not constitute
a breach of this Section 6.6.
SECTION 6.7 Delegation of Duties. Subject to Section 3.1, in
the ordinary course of business, the Servicer may at any time delegate any
duties hereunder to any Person who agrees to conduct such duties in accordance
with the Floorplan Financing Guidelines and this Agreement. The Servicer shall
give prompt written notice of any such delegation of a material function to the
Owner Trustee, the Indenture Trustee, Rating Agencies, any Agent and any
Enhancement Providers. Such delegation shall not relieve the Servicer of its
liability and responsibility with respect to such duties, shall not constitute a
resignation within the meaning of Section 6.5, and written notice shall have
been delivered to each applicable Rating Agency with respect to such delegation
prior to such delegation.
SECTION 6.8 Examination of Records. The Transferor and the
Servicer shall indicate generally in its computer files or other records that
the Receivables arising in the Accounts have been conveyed to the Trust pursuant
to this Agreement for the benefit of the Certificateholders and the
Beneficiaries. The Transferor and the Servicer shall, prior to the sale or
transfer to a third party of any receivable held in its custody, examine its
computer and other records to determine that such receivable is not a
Receivable.
SECTION 6.9 Additional Expenses. The Servicer covenants and
agrees to pay from time to time out of its own funds such reasonable costs, fees
and expenses as may be incurred by third
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parties designated by the Transferor in connection with the provision of
services directly or indirectly to the Trust or otherwise in connection with the
facilitation of an offering of the Notes of one or more classes issued
hereunder.
ARTICLE VII
SERVICING DEFAULTS
SECTION 7.1 Servicing Defaults. If any one of the following
events (a "Servicing Default") shall occur and be continuing with respect to the
Servicer:
(a) any failure by the Servicer to make any payment, transfer
or deposit or to give instructions or to give notice to the Owner Trustee or the
Indenture Trustee to make such payment, transfer or deposit or to give notice to
the Owner Trustee or the Indenture Trustee as to any action to be taken under
any Enhancement Agreement on or before the date occurring five Business Days
after the date such payment, transfer or deposit or such instruction or notice
is required to be made or given, as the case may be, under the terms of this
Agreement;
(b) failure on the part of the Servicer duly to observe or
perform any other covenants or agreements of the Servicer set forth in this
Agreement which has a material adverse effect on the Noteholders of any Series,
which continues unremedied for a period of 30 days after the date on which
written notice of such failure, requiring the same to be remedied, shall have
been given to the Servicer by the Indenture Trustee or Owner Trustee; or the
Servicer shall delegate its duties under this Agreement, except as permitted by
Sections 3.1 and 6.7;
(c) any representation, warranty or certification made by the
Servicer in this Agreement or in any certificate delivered pursuant to this
Agreement shall prove to have been incorrect when made, which has a material
adverse effect on the rights of the Noteholders of any Series and which material
adverse effect continues for a period of 60 days after the date on which written
notice thereof, requiring the same to be remedied, shall have been given to the
Servicer by the Indenture Trustee or Owner Trustee; or
(d) the Servicer shall consent to the appointment of a
conservator or receiver or liquidator or other similar official in any
bankruptcy, insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings of or relating to the Servicer or of or
relating to all or substantially all of its property, or a decree or order of a
court or agency or supervisory authority having jurisdiction in the premises for
the appointment of a conservator or receiver or liquidator or other similar
official in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Servicer and such decree or order
shall have remained in force undischarged or unstayed, or the Servicer shall
admit in writing its inability to pay its debts generally as they become due,
file a petition to take advantage of any applicable
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bankruptcy, insolvency or reorganization statute, make any assignment for the
benefit of its creditors or voluntarily suspend payment of its obligations.
In the event any Servicing Default occurs, so long as the
Servicing Default shall not have been remedied, the Indenture Trustee, by notice
then given in writing to the Servicer (a "Termination Notice") with a copy to
the Owner Trustee, may terminate all but not less than all of the rights and
obligations (other than its obligations that have accrued up to the time of such
termination) of the Servicer as Servicer under this Agreement and in and to the
Receivables and the proceeds thereof. After receipt by the Servicer of a
Termination Notice, and on the date that a Successor Servicer shall have been
appointed by the Indenture Trustee pursuant to Section 7.2, all authority and
power of the Servicer under this Agreement shall pass to and be vested in a
Successor Servicer (a "Servicing Transfer") and, without limitation, the
Indenture Trustee is hereby authorized and empowered (upon the failure of the
Servicer to cooperate) to execute and deliver, on behalf of the Servicer, as
attorney-in-fact or otherwise, all documents and other instruments upon the
failure of the Servicer to execute or deliver such documents or instruments, and
to do and accomplish all other acts or things necessary or appropriate to effect
the purposes of such Servicing Transfer. The Servicer agrees to cooperate with
the Indenture Trustee and such Successor Servicer in effecting the termination
of the responsibilities and rights of the Servicer to conduct servicing
hereunder, including the transfer to such Successor Servicer of all authority of
the Servicer to service the Receivables provided for under this Agreement,
including all authority over all Collections which shall on the date of transfer
be held by the Servicer for deposit, or which have been deposited by the
Servicer, in the Collection Account, or which shall thereafter be received with
respect to the Receivables, and in assisting the Successor Servicer. The
Servicer shall promptly transfer its electronic records relating to the
Receivables to the Successor Servicer in such electronic form as the Successor
Servicer may reasonably request and shall promptly transfer to the Successor
Servicer all other records, correspondence and documents necessary for the
continued servicing of the Receivables in the manner and at such times as the
Successor Servicer shall reasonably request. To the extent that compliance with
this Section 7.1 shall require the Servicer to disclose to the Successor
Servicer information of any kind which the Servicer reasonably deems to be
confidential, the Successor Servicer shall be required to enter into such
customary licensing and confidentiality agreements as the Servicer shall deem
necessary to protect its interest.
Notwithstanding the foregoing, a delay in or failure of
performance under Section 7.1(a) for a period of 10 Business Days or under
Section 7.1(b) or (c) for a period of 60 Business Days, shall not constitute a
Servicing Default if such delay or failure could not be prevented by the
exercise of reasonable diligence by the Servicer and such delay or failure was
caused by an act of God or the public enemy, acts of declared or undeclared war,
public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire,
hurricanes, earthquakes, floods or similar causes. The preceding sentence shall
not relieve the Servicer from using its best efforts to perform its respective
obligations in a timely manner in accordance with the terms of this Agreement
and the Servicer shall provide the Owner Trustee, Indenture Trustee, any Agents,
any Enhancement Providers, the Transferor and the Noteholders with an Officers'
Certificate giving prompt notice of such failure or delay by it, together with a
description of its efforts so to perform its obligations. The Servicer shall
immediately notify the Owner Trustee in writing of any Servicing Default.
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SECTION 7.2 Indenture Trustee to Act; Appointment of
Successor. On and after the receipt by the Servicer of a Termination Notice
pursuant to Section 7.1, the Servicer shall continue to perform all servicing
functions under this Agreement until the date specified in the Termination
Notice or otherwise specified by the Indenture Trustee in writing or, if no such
date is specified in such Termination Notice, or otherwise specified by the
Indenture Trustee, until a date mutually agreed upon by the Servicer and the
Indenture Trustee. The Indenture Trustee shall as promptly as possible after the
giving of a Termination Notice appoint an Eligible Servicer as a successor
Servicer (the "Successor Servicer"), subject to the consent of any Enhancement
Providers and any Agents, which consent shall not be unreasonably withheld, and
such Successor Servicer shall accept its appointment by a written assumption in
a form acceptable to the Indenture Trustee. In the event that a Successor
Servicer has not been appointed or has not accepted its appointment at the time
when the Servicer ceases to act as Servicer, the Indenture Trustee without
further action shall automatically be appointed the Successor Servicer. The
Indenture Trustee may delegate any of its servicing obligations to an affiliate
or agent in accordance with Sections 3.1 and 6.7. Notwithstanding the above, the
Indenture Trustee shall, if it is legally unable so to act, petition a court of
competent jurisdiction to appoint any established institution having a net worth
of not less than $100,000,000 and whose regular business includes the servicing
of wholesale receivables as the Successor Servicer hereunder. The Indenture
Trustee shall immediately give notice to the Owner Trustee, the Rating Agencies,
any Enhancement Providers, any Agents and the Noteholders upon the appointment
of a Successor Servicer. Notwithstanding anything herein or in the Indenture to
the contrary, in no event shall the Indenture Trustee be liable for any
Servicing Fee or for any differential in the amount of the Servicing Fee paid
hereunder and the amount necessary to induce any Successor Servicer to act as
Successor Servicer under this Agreement and the transactions contemplated
hereby.
(a) Upon its appointment, the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions
under this Agreement and shall be subject to all the responsibilities, duties
and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof (except that the Successor Servicer shall not be liable for
any liabilities incurred by the predecessor Servicer), and all references in
this Agreement to the Servicer shall be deemed to refer to the Successor
Servicer. Any Successor Servicer, by its acceptance of its appointment, will
automatically agree to be bound by the terms and provisions of any Enhancement
Agreement.
(b) In connection with any Termination Notice, the Indenture
Trustee will review any bids which it obtains from Eligible Servicers and shall
be permitted to appoint any Eligible Servicer submitting such a bid as a
Successor Servicer for servicing compensation not in excess of the Servicing Fee
(provided that if all such bids exceed the Servicing Fee the Transferor at its
own expense shall pay when due the amount of any compensation in excess of the
Servicing Fee); provided, however, that the Transferor shall be responsible for
payment of the Transferor's portion of the Servicing Fee as determined pursuant
to this Agreement and all other amounts in excess of the Investors' Servicing
Fee, and that no such monthly compensation paid out of Collections shall be in
excess of the Investors' Servicing Fee permitted to the Servicer. The Holders of
the Certificates agree that if World Omni (or any Successor Servicer) is
terminated as Servicer hereunder, the portion of Collections to be paid to the
Transferor shall be reduced by an amount sufficient to pay the Transferor's
share of the compensation of the Successor Servicer.
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(c) All authority and power granted to the Successor Servicer
under this Agreement shall automatically cease and terminate upon termination of
the Trust pursuant to Section 7.1 of the Trust Agreement, and shall pass to and
be vested in the Transferor and, without limitation, the Transferor is hereby
authorized and empowered to execute and deliver, on behalf of the Successor
Servicer, as attorney-in-fact or otherwise, all documents and other instruments,
and to do and accomplish all other acts or things necessary or appropriate to
effect the purposes of such transfer of servicing rights. The Successor Servicer
agrees to cooperate with the Transferor in effecting the termination of the
responsibilities and rights of the Successor Servicer to conduct servicing on
the Receivables. The Successor Servicer shall transfer its electronic records
relating to the Receivables to the Transferor in such electronic form as the
Transferor may reasonably request and shall transfer all other records,
correspondence and documents to the Transferor in the manner and at such times
as the Transferor shall reasonably request in writing. To the extent that
compliance with this Section 7.2 shall require the Successor Servicer to
disclose to the Transferor information of any kind which the Successor Servicer
deems to be confidential, the Transferor shall be required to enter into such
customary licensing and confidentiality agreements as the Successor Servicer
shall deem necessary to protect its interests.
SECTION 7.3 Notification to Securityholders. Upon any
termination of, or appointment of a successor to, the Servicer pursuant to this
Article VII, the Indenture Trustee shall give prompt written notice thereof to
the Noteholders and the Rating Agencies and the Owner Trustee shall give prompt
written notice thereof to the Certificateholders.
SECTION 7.4 Waiver of Past Defaults. Noteholders whose Notes
evidence not less than a majority of the Outstanding Amount of the Notes as of
the close of the preceding Payment Date (or, if all of the Notes have been paid
in full and the Indenture has been discharged in accordance with its terms,
Certificateholders whose Certificates evidence not less than a majority of the
Voting Interests as of the close of the preceding Payment Date) voting as a
single class, may, on behalf of all Securityholders, waive any default by the
Servicer in the performance of its obligations hereunder and under the
Receivables Purchase Agreement and its consequences, except a Servicing Default
under Section 7.1(a) of this Agreement. Upon any such waiver of a past default,
such default shall cease to exist, and any Servicing Default arising therefrom
shall be deemed to have been remedied for every purpose of this Agreement and
the Receivables Purchase Agreement. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
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ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.1 Amendment.
(a) This Agreement may be amended from time to time by the
Servicer, the Transferor and the Trust without the consent of any of the
Securityholders or any Enhancement Provider, provided that such action shall not
adversely affect in any material respect the interests of any Noteholder and
prior written notice is given to the Indenture Trustee and the Rating Agencies.
The absence of such materially adverse effect may be evidenced by (i)
satisfaction of the Rating Agency Condition with respect to the affected Notes
in connection with such amendment or (ii) an Officers' Certificate of the
Transferor, addressed and delivered to the Owner Trustee. Notwithstanding
anything contained herein to the contrary, the Owner Trustee may at any time and
from time to time amend, modify or supplement the form of Payment Date
Statement.
(b) This Agreement may also be amended from time to time by
the Servicer, the Transferor and the Trust, with prior written notice to the
Indenture Trustee and the Rating Agencies and either (i) the consent of
Noteholders whose Notes evidence not less than a majority in principal amount of
the Controlling Class of each Series of Notes adversely affected in any material
respect thereby for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or modifying in
any manner the rights of the Noteholders or (ii) satisfaction of the Rating
Agency Condition; provided, however, that no such amendment shall (i) reduce in
any manner the amount of or accelerate or delay the timing of any distributions
or payments to be made to Noteholders or deposits of amounts to be so
distributed or the amount available under any Enhancement, without the consent
of the Holder thereof, (ii) change the definition of or the manner of
calculating the interest of any Note without the consent of each affected
Noteholder, (iii) reduce the aforesaid percentage required to consent to any
such amendment without the consent of the Noteholders or (iv) adversely affect
the rating of any Series or class of Notes by any Rating Agency without the
consent of two-thirds of the principal amount of the outstanding Notes of such
Series or Class. Any amendment to be effected pursuant to this paragraph shall
be deemed to adversely affect all outstanding Series, other than any Series with
respect to which such action shall not, as evidenced by an Officer's Certificate
addressed and delivered to the Owner Trustee and the Indenture Trustee,
adversely affect in any material respect the interests of any Noteholder of such
Series. The Owner Trustee may, but shall not be obligated to, execute and
deliver, on behalf of the Trust, any amendment that affects the Owner Trustee's
rights, duties or immunities under this Agreement or otherwise.
(c) Promptly after the execution of any such amendment or
consent (other than an amendment pursuant to paragraph (a)), the Owner Trustee
shall furnish notification of the substance of such amendment to each Noteholder
and the Indenture Trustee, and the Servicer shall furnish notification of the
substance of such amendment to each Rating Agency, each Agent and each
Enhancement Provider.
(d) It shall not be necessary for the consent of Noteholders
under this Section to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall
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approve the substance thereof. The manner of obtaining such consents and of
evidencing the authorization of the execution thereof by Noteholders shall be
subject to such reasonable requirements as the Owner Trustee may prescribe.
(e) Notwithstanding anything in this Section to the contrary,
no amendment may be made to this Agreement or any Series Supplement which would
adversely affect in any material respect the interests of any Enhancement
Provider or the Indenture Trustee without the consent of such Enhancement
Provider or the Indenture Trustee, as the case may be.
(f) Any Series Supplement executed in accordance with the
provisions of Article IX of the Indenture shall not be considered an amendment
to this Agreement for the purposes of this Section.
SECTION 8.2 No Petition Covenant. The Servicer, World Omni (if
it is no longer the Servicer) and the Trust, by entering into this Agreement,
each Noteholder, by accepting a Note, each Certificateholder, any Successor
Servicer and the Indenture Trustee, by accepting the benefits of this Agreement,
hereby covenants and agrees that they will not at any time institute against
WODFI any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law.
SECTION 8.3 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK,
WITHOUT REFERENCE TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF OR OF ANY OTHER
JURISDICTION, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 8.4 Notices. All demands, notices and communications
upon or to the Servicer, the Transferor, the Administrator, the Indenture
Trustee, the Trust or the Rating Agencies or any Certificateholder or Noteholder
under this Agreement shall be delivered as specified in Appendix B to this
Agreement.
SECTION 8.5 Severability of Provisions. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreements, provisions
or terms shall be deemed enforceable to the fullest extent permitted, and if not
so permitted, shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Agreement or of the
Notes or rights of the Noteholders.
SECTION 8.6 Assignment. Notwithstanding anything to the
contrary contained herein, except as provided in Sections 6.2, this Agreement
may not be assigned by the Servicer.
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SECTION 8.7 Further Assurances. The Transferor and the
Servicer agree to do and perform, from time to time, any and all acts and to
execute any and all further instruments required or reasonably requested by the
Trust more fully to effect the purposes of this Agreement, including the
execution of any financing statements or continuation statements relating to the
Receivables for filing under the provisions of the UCC of any applicable
jurisdiction.
SECTION 8.8 No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Trust or the
Noteholders, any right, remedy, power or privilege under this Agreement shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege under this Agreement 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 under this
Agreement are cumulative and not exhaustive of any rights, remedies, powers and
privileges provided by law.
SECTION 8.9 Counterparts. This Agreement may be executed in
two or more counterparts (and by different parties on separate counterparts),
each of which shall be an original, but all of which together shall constitute
one and the same instrument.
SECTION 8.10 Third-Party Beneficiaries. This Agreement will
inure to the benefit of and be binding upon the parties hereto, the Indenture
Trustee, the Securityholders, the Enhancement Providers and their respective
successors and permitted assigns. Except as otherwise expressly provided in this
Agreement, no other Person will have any right or obligation hereunder.
SECTION 8.11 Action by Owner Trustee. Upon any application or
request by the Transferor or Servicer to the Owner Trustee to take any action
under any provision under this Agreement, the Transferor or Servicer, as the
case may be, shall furnish to the Owner Trustee an Officer's Certificate stating
that all conditions precedent, if any, provided for in this Agreement relating
to the proposed action have been complied with. The Owner Trustee shall be
entitled to conclusively rely on the Officer's Certificate as authority for any
action undertaken in connection therewith.
SECTION 8.12 Merger and Integration. Except as specifically
stated otherwise herein, this Agreement sets forth the entire understanding of
the parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived, or supplemented except as provided herein.
SECTION 8.13 Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation or
any provision hereof.
SECTION 8.14 Effect of Amendment and Restatement. It is the
intent of the parties hereto that this Trust Sale and Servicing Agreement, as
amended and restated as of __________, 2000, shall as of such date, replace in
its entirety the Original Trust Sale and Servicing Agreement; provided, that
with respect to the period of time from November 22, 1999 through __________,
2000, the rights and
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obligations of the parties shall be governed by the Original Trust Sale and
Servicing Agreement; provided further, that the amendment and restatement of the
Original Trust Sale and Servicing Agreement shall not effect any of the grants,
conveyances or transfers contemplated by the Original Trust Sale and Servicing
Agreement to have occurred prior to the date hereof.
* * * *
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IN WITNESS WHEREOF, the Transferor, the Servicer and the Trust have caused this
Amended and Restated Trust Sale and Servicing Agreement to be duly executed by
their respective officers as of the day and year first above written.
WORLD OMNI FINANCIAL CORP.
Servicer,
By ____________________________________
Eric M. Gebhard
Assistant Secretary
WODFI LLC
Transferor,
By ____________________________________
Eric M. Gebhard
Assistant Secretary
WORLD OMNI MASTER OWNER TRUST
By: CHASE MANHATTAN BANK DELAWARE not
in its individual capacity, but solely as
Owner Trustee on behalf of the Trust
By ____________________________________
Name:
Title:
Acknowledged and Accepted:
HARRIS TRUST AND SAVINGS BANK, not in
its individual capacity, but solely as
Indenture Trustee
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By __________________________________
E. Kay Liederman Van Dam
Vice President
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APPENDIX A
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PART I - DEFINITIONS
Whenever used in this Agreement, the following words and phrases shall
have the following meanings:
"Account" shall mean each Initial Account and, from and after the
related Addition Date, each Additional Account. The term "Account" shall not
apply to any Removed Accounts reassigned or assigned to the Transferor or the
Servicer in accordance with the terms of the Trust Sale and Servicing Agreement.
"Accumulation Period" shall mean, with respect to any Series of Notes,
the period specified in the related Series Supplement, if any.
"Act " shall mean an Act as specified in Section 11.3(a) of the
Indenture.
"Addition Date" shall mean, with respect to Additional Accounts, the
date from and after which such Additional Accounts are to be included as
Accounts pursuant to Section 2.5(c) of the Trust Sale and Servicing Agreement.
"Addition Notice" shall have the meaning specified in Section 2.5(c) of
the Trust Sale and Servicing Agreement.
"Additional Accounts" shall mean each individual wholesale financing
account established with a Dealer pursuant to a Floorplan Financing Agreement or
Asset Based Lending Financing Agreement, which account is designated pursuant to
Section 2.5, of the Trust Sale and Servicing Agreement to be included as an
Account and is identified in the computer file or microfiche or written list
delivered to the Owner Trustee by the Transferor pursuant to Sections 2.1 and
2.5(d) (iii) of the Trust Sale and Servicing Agreement.
"Additional Cut-Off Date" shall mean, with respect to Additional
Accounts, the day specified in the Addition Notice delivered with respect to
such Additional Accounts pursuant to Section 2.5(c) of the Trust Sale and
Servicing Agreement.
"Adjustment Payment" shall have the meaning specified in Section 3.9 of
the Trust Sale and Servicing Agreement.
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"Administration Agreement" shall mean that certain Administration
Agreement, dated as of the Initial Closing Date, among World Omni, as
Administrator, the Issuer and the Indenture Trustee, as amended and supplemented
from time to time.
"Administrator" shall mean World Omni or any successor Administrator
under the Administration Agreement.
"Advance Date" shall have the meaning specified in the related Series
Supplement.
"Affiliate" shall mean, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect to
any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agency Office" shall mean the office of the Issuer maintained pursuant
to Section 3.2 of the Indenture.
"Agent" shall mean, with respect to any Series, the Person so
designated in the related Series Supplement.
"Amortization Period" shall have, with respect to any Series, the
meaning specified in the related Series Supplement.
"Annual Retransfer Date" shall have the meaning specified in Section
3.10(a) of the Trust Sale and Servicing Agreement.
"Annual Servicing Transfer" shall have the meaning specified in Section
3.10(a) of the Trust Sale and Servicing Agreement.
"Annual Transfer Agreement" shall have the meaning specified in Section
3.10(a) of the Trust Sale and Servicing Agreement.
"Annual Transfer Date" shall have the meaning specified in Section
3.10(a) of the Trust Sale and Servicing Agreement.
"Asset Based Lending Business" shall mean the extensions of credit made
by World Omni to Dealers in order to provide loans based on the value of certain
assets of such Dealer and secured by a first priority security interest in such
assets.
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"Asset Based Lending Financing Agreement" shall mean an asset based
lending financing agreement entered into by World Omni and a Dealer in
connection with the Asset Based Lending Business with such Dealer, as amended or
modified from time to time.
"Asset Based Receivable Overconcentrations" shall mean, on any
Determination Date, the excess of (a) the aggregate Principal Receivables
included in all Accounts created pursuant to Asset Based Lending Financing
Agreements as of the last day of the immediately preceding Collection Period
over (b) the product of (i) 10% and (ii) the Pool Balance on the last day of
such immediately preceding Collection Period.
"Asset Based Receivable" shall mean Receivables arising from the Asset
Based Lending Business.
"Assignment" shall have the meaning specified in Section 2.5(d) (iii)
of the Trust Sale and Servicing Agreement.
"Authorized Officer" shall mean with respect to the Issuer, any officer
of the Owner Trustee who is authorized to act for the Owner Trustee in matters
relating to the Issuer and who is identified on the list of Authorized Officers
delivered by the Owner Trustee to the Indenture Trustee on the Initial Closing
Date (as such list may be modified or supplemented from time to time thereafter)
and, so long as the Administration Agreement is in effect, any Vice President or
more senior officer of the Administrator who is authorized to act for the
Administrator in matters relating to the Issuer and to be acted upon by the
Administrator pursuant to the Administration Agreement and who is identified on
the list of Authorized Officers delivered by the Administrator to the Indenture
Trustee on the Initial Closing Date (as such list may be modified or
supplemented from time to time thereafter). With respect to any other Person,
any Vice President or more senior officer of such Person who is authorized to
act for such Person with respect to such matters.
"Automatic Additional Accounts" shall have the meaning specified in
Section 2.5(b) of the Trust Sale and Servicing Agreement.
"Automatic Removal Date" shall have the meaning specified in Section
2.7(d) (i) of the Trust Sale and Servicing Agreement.
"Automatic Removed Accounts" shall have the meaning specified in
Section 2.7(d) of the Trust Sale and Servicing Agreement.
"Available Subordinated Amount" shall mean, with respect to any Series
at any time of determination, an amount equal to the available subordinated
amount specified in the related Series Supplement at such time.
"Basic Documents" shall mean the Certificate of Trust, the Trust
Agreement, the Receivables Purchase Agreement, the Trust Sale and Servicing
Agreement, the Administration Agreement, the Indenture
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(including all Series Supplements), the Enhancement Agreements and the other
documents and certificates delivered in connection therewith from time to time.
"Beneficiary" shall mean any of the Holders of the Notes and any
Enhancement Provider.
"Benefit Plan" shall mean any one of (a) an employee benefit plan (as
described 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.
"Book-Entry Note" shall mean Notes in which ownership and transfers
shall be made through book entries by a Clearing Agency as described in Section
2.10 of the Indenture.
"Business Day" shall mean any day other than (a) a Saturday or a Sunday
or (b) another day on which banking institutions or trust companies in the State
of Florida, the State of New York or the State of Illinois are authorized or
obligated by law, executive order or governmental decree to be closed.
"Business Trust Statute" shall mean Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq., as the same may be amended from
time to time.
"Certificate" shall mean any one of the Certificates executed by the
Owner Trustee and authenticated by the Owner Trustee in substantially the form
set forth in Exhibit A to the Trust Agreement.
"Certificate Distribution Account" shall mean the account designated as
such, established and maintained pursuant to Section 5.1(a) of the Trust
Agreement.
"Certificate of Trust" shall mean the certificate of trust of the
Issuer substantially in the form of Exhibit B to the Trust Agreement to be filed
for the Trust pursuant to Section 3810(a) of the Business Trust Statute.
"Certificate Register" shall mean the register of Certificates
specified in Section 3.5(a) of the Trust Agreement.
"Certificate Registrar" shall mean the registrar at any time of the
Certificate Register, appointed pursuant to Section 3.5(a) of the Trust
Agreement.
"Certificateholders" shall mean persons in whose name a Certificate is
registered on the Certificate Register.
"Clearing Agency" shall mean an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act. The Clearing Agency for the
Notes and the Certificates shall be The Depository Trust Company.
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"Clearing Agency Participant" shall mean a securities broker, dealer,
bank, trust company, clearing corporation or other financial institution or
other Person for whom from time to time a Clearing Agency effects book entry
transfers and pledges of securities deposited with the Clearing Agency.
"Clearstream" shall mean Clearstream Banking, societe anonyme.
"Closing Date" shall mean, with respect to any Series, the Closing Date
specified in the related Series Supplement, including the Initial Closing Date.
"Code" shall mean the Internal Revenue Code of 1986 as amended, and the
Treasury Regulations promulgated thereunder.
"Collateral" shall mean the collateral specified in the granting clause
of the Indenture.
"Collateral Security" shall mean, with respect to any Receivable and
subject to the terms of the Receivables Purchase Agreement, the security
interest granted by or on behalf of the related Dealer granted to secure payment
of such Receivable, including a first priority perfected security interest in
the related Vehicle, parts inventory, equipment, fixtures, service accounts or
realty with respect to such Dealer and all guarantees of any Receivable.
"Collection Account" shall have the meaning specified in Section 4.2(a)
of the Trust Sale and Servicing Agreement.
"Collection Period" shall mean, with respect to any Payment Date, the
calendar month preceding the month in which such Payment Date occurs.
"Collections" shall mean, without duplication, all payments by or on
behalf of Dealers received by the Servicer in respect of the Receivables, in the
form of cash, checks, wire transfers or any other form of payment; and shall
include, without duplication the amount of any Rebate Payments deposited by the
Servicer into the Collection Account (such amounts being deemed Non-Principal
Collections).
"Common Collateral" shall have the meaning specified in Article VII of
the Receivables Purchase Agreement.
"Common Non-Vehicle Collateral" shall have the meaning specified in
Article VII of the Receivables Purchase Agreement.
"Common Vehicle Collateral" shall have the meaning specified in Article
VII of the Receivables Purchase Agreement.
"Controlled Amortization Period" shall mean, with respect to any Series
of Notes, the period specified in the related Series Supplement, if any.
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"Controlling Class" shall mean, with respect to a Series of Notes, (a)
if there is only one class of Notes in that Series, all Notes of that Series and
(b) if there is more than one class of Notes in that Series, the class or
classes with the highest rating.
"Corporate Trust Office" shall mean with respect to the Indenture
Trustee or the Owner Trustee, the principal office at which at any particular
time the corporate trust business of the Indenture Trustee or Owner Trustee,
respectively, shall be administered, which offices at the Initial Closing Date
are located:
in the case of the Indenture Trustee, at:
Harris Trust and Savings Bank
311 W. Monroe Street
12th Floor
Chicago, Illinois 60601
Attention: Indenture Trust Administration
Facsimile No.: (312) 461-3525
and in the case of the Owner Trustee, at:
Chase Manhattan Bank Delaware
1201 Market Street, Corporate Trust, 9th Floor
Wilmington, Delaware 19801
Attention: Corporate Trustee Administration
provided that, when the definition of "Corporate Trust Office" is used
in connection with providing notice to the Owner Trustee, a copy of
such notice shall also be sent to:
The Chase Manhattan Bank
450 W. 33rd Street
New York, New York 10001
Attention: Global Trust Services
"Cut-Off Date" shall mean the Initial Cut-Off Date and any Additional
Cut-Off Date, as applicable.
"Date of Processing" shall mean, with respect to any transaction, the
date on which such transaction is first recorded on the Servicer's computer file
of accounts (without regard to the effective date of such recordation).
"Dealer" shall mean a Person engaged generally in the business of
purchasing Vehicles from a manufacturer or distributor thereof and holding such
Vehicles for sale or lease in the ordinary course of business.
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"Dealer Concentration Limit" means (i) 8% for each of any two Dealer
Groups designated by the Servicer, (ii) 6% for each of any four Dealer Groups
designated by the Servicer, (iii) 4% for each of any two Dealer Groups
designated by the Servicer, (iv) 3% for each of any seven Dealer Groups
designated by the Servicer, and (v) 2% for each of the remaining Dealer Groups.
"Dealer Groups" means any Dealer or group of affiliated Dealers (as
determined in accordance with the Servicer's standard procedures for identifying
and tracking Accounts of affiliated Dealers).
"Dealer Overconcentration" shall mean on any Determination Date, with
respect to any Dealer Group, the excess of (a) the aggregate Principal
Receivables included in all Accounts of such Dealer Group as of the last day of
the immediately preceding Collection Period over (b) the product of (i) the
Dealer Concentration Limit for such Dealer Group and (ii) the Pool Balance on
the last day of such immediately preceding Collection Period.
"Defaulted Amount" for any Collection Period shall mean an amount equal
to the excess, if any, of:
(a) the principal amount of Receivables that become Defaulted
Receivables during the preceding Collection Period
over
(b) the sum of:
(1) The full amount of any Defaulted Receivables
subject to reassignment to the Transferor or purchase by the
Servicer for such Collection Period unless an Insolvency Event
occurs for either of the Transferor or the Servicer, in which
event the Defaulted Amount will not be reduced for those
Defaulted Receivables
and
(2) the Defaulted Amount Carryover for the prior
Collection Period.
"Defaulted Amount Carryover" for any Collection Period shall mean an
amount equal to the excess, if any, of the amount specified in clause (b) of the
definition of Defaulted Amount over the amount specified in clause (a) of the
definition of Defaulted Amount; provided, however, that the Defaulted Amount
Carryover for the Collection Period prior to the October 1999 Collection Period
shall be zero.
"Defaulted Receivables" shall mean (a) all Receivables which are
charged off as uncollectible in respect of the immediately preceding Collection
Period in accordance with the Servicer's customary and usual servicing
procedures for servicing Dealer floorplan receivables comparable to the
Receivables which have not been sold to third parties and (b) all Receivables
which were Eligible Receivables when transferred to the Trust on the Initial
Closing Date or the related Addition Date or on their respective Transfer Date,
which arose in an Account that thereafter became an Ineligible Account and which
remained
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outstanding for any six consecutive Determination Dates (inclusive of the
Determination Date on which such determination is being made) after such Account
became an Ineligible Account.
"Definitive Notes" shall mean the Notes issued pursuant to the
Indenture in definitive form either upon original issuance or upon termination
of book-entry registration with respect to such Notes pursuant to Section 2.12
of the Indenture.
"Deposit Date" shall mean each day on which the Servicer deposits
Collections in the Collection Account pursuant to Section 4.3 of the Trust Sale
and Servicing Agreement.
"Depository" shall mean The Depository Trust Company, as initial
Depository, the nominee of which is CEDE & Co., or any other organization
registered as a "clearing agency" pursuant to Section 17A of the Securities
Exchange Act of 1934, as amended. The Depository shall at all times be a
"clearing corporation" as defined in Section 8-102(3) of the Uniform Commercial
Code of the State of New York.
"Depository Agreement" shall mean, with respect to any Series or Class,
the agreement among the Transferor, the Indenture Trustee and the initial
Depository, dated as of the related Closing Date.
"Depository Participant" shall mean a broker, dealer, bank or other
financial institution or other Person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.
"Designated Accounts" shall have the meaning specified in Section
2.6(b)(i) of the Receivables Purchase Agreement.
"Designated Balance" shall have the meaning specified in Section
2.6(b)(ii) of the Receivables Purchase Agreement.
"Designated Receivables" shall have the meaning specified in Section
2.7 (c)(i) of the Trust Sale and Servicing Agreement.
"Determination Date" shall mean, with respect to any Payment Date, the
day that is two Business Days prior to such date.
"Early Amortization Event" shall have the meaning specified in Section
5.17 of the Indenture and, with respect to any Series or class, shall also mean
any Early Amortization Event specified in the related Series Supplement.
"Early Amortization Period" shall mean, with respect to any Series, the
period beginning at the close of business on the Business Day immediately
preceding the day on which the Early Amortization Event is deemed to have
occurred, and in each case ending upon the earlier to occur of (a) the payment
in full of the outstanding principal balance of the Notes of that Series, (b)
the Termination Date with respect to such Series and (c) the recommencement of
the Revolving Period for that Series.
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"Eligible Account" shall mean each individual wholesale financing
revolving line of credit extended by World Omni to a Dealer pursuant to a
Floorplan Financing Agreement or Asset Based Lending Financing Agreement or
which has been acquired by World Omni, which, as of the date of determination
with respect thereto: (a) is established or acquired by World Omni in the
ordinary course of business pursuant to a dealer financing agreement, (b) is in
favor of a Dealer which is an Eligible Dealer, (c) is in existence and
maintained and serviced by or on behalf of World Omni (or a Successor Servicer)
or relates to a Purchased Participation Receivable for which the Rating Agency
Condition has been satisfied and (d) is an Account in respect of which no
amounts have been charged off as uncollectible or are classified as past due or
delinquent.
"Eligible Dealer" shall mean a Dealer, as of the date of determination
thereof, (a) which is located in the United States of America (including its
territories and possessions), or such other jurisdiction as shall have been
specified by the Servicer and as to which the Rating Agency Condition shall have
been satisfied, (b) which has not been identified by the Servicer as being the
subject of any voluntary or involuntary bankruptcy proceeding or voluntary or
involuntary liquidation and (c) which is not a government or governmental agency
(including, without limitation, the United States or any states or any state of
the United States or any agency or subdivision thereof).
"Eligible Deposit Account" shall mean either (a) a segregated account
with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the laws
of the United States of America or any one of the states thereof, including the
District of Columbia (or any domestic branch of a foreign bank), having
corporate trust powers and acting as trustee for funds deposited in such
account, so long as any of the securities of such depository institution or
trust company shall have a credit rating from each Rating Agency in one of its
generic rating categories which signifies investment grade.
"Eligible Institution" shall mean (a) the corporate trust department of
the Indenture Trustee or (b) a depository institution or trust company organized
under the laws of the United States of America or any one of the states thereof,
or the District of Columbia (or any domestic branch of a foreign bank), which at
all times (i) has either (A) a long-term unsecured debt rating of Aa2 or better
by Moody's, AA or better by Standard & Poor's and AA or better by Fitch or such
other rating that is acceptable to each Rating Agency, as evidenced by a letter
from such Rating Agency to the Indenture Trustee or (B) a certificate of deposit
rating of P-1 by Moody's, A-1 by Standard & Poor's and F-1+ by Fitch or such
other rating that is acceptable to each Rating Agency, as evidenced by a letter
from such Rating Agency to the Indenture Trustee and (ii) whose deposits are
insured by the FDIC.
"Eligible Investments" shall mean any of the following in each case
with a remaining term of no more than one year:
(a) direct obligations of, and obligations guaranteed as to
full and timely payment by, the United States or any agency or
instrumentality of the United States the obligations of which are
backed by the full faith and credit of the United States (other than
the Government National Mortgage Association);
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(b) direct obligations of, or obligations fully guaranteed by,
the Federal National Mortgage Association or any State then rated with
the highest available credit rating of the Rating Agencies for such
obligations; the obligations must also be, at the time of investment,
otherwise acceptable to each Rating Agency;
(c) demand deposits, time deposits, certificates of deposit,
bankers' acceptances issued by, or federal funds sold by any depository
institution or trust company, including the Indenture Trustee,
incorporated under the laws of the United States or any state thereof
(or any domestic branch of a foreign bank) and subject to supervision
and examination by federal or state banking or depository institution
authorities and whose deposits are fully insured by the FDIC; provided,
however, that at the time of the Trust's investment or contractual
commitment to invest therein, such depository institution or trust
company has the Required Rating or the Indenture Trustee shall have
received a letter from each Rating Agency to the effect that such
investment would not result in the qualification, downgrading or
withdrawal of the ratings assigned to the Rated Securities;
(d) repurchase obligations held by the Indenture Trustee that
are acceptable to the Indenture Trustee for any security described in
clause (a) above or (f) below, or any other security issued or
guaranteed by any agency or instrumentality of the United States, in
either case entered into with a federal agency or depository
institution or trust company, including the Indenture Trustee, acting
as principal, whose obligations, if they had the same maturity as a
repurchase agreement, would be Eligible Investments under clause (b) or
(c) above;
(e) securities bearing interest or sold at a discount issued
by any corporation incorporated under the laws of the United States or
any state so long as at the time of such investment either the
long-term, unsecured debt of such corporation has the highest available
rating from the Rating Agencies or the Indenture Trustee shall have
received a letter from each Rating Agency stating that the investment
would not result in the qualification, downgrading or withdrawal of the
ratings then assigned to any Rated Securities, or commercial paper or
other short-term debt having the Required Rating; however, any such
commercial paper or other short-term debt may have a remaining term to
maturity of no longer than 30 days after the date of such investment;
(f) interests in any open-end or closed-end management type
investment company or investment trust registered under the Investment
Company Act, whose portfolio is limited to the obligations of, or
guaranteed by, the United States and to agreements to repurchase such
obligations, which agreements, for principal and interest, are at least
100% collateralized by such obligations marked to market on a daily
basis and the investment company or investment trust shall take
delivery of such obligations either directly or through an independent
custodian designated in accordance with the Investment Company Act and
acceptable to each Rating Agency, as approved in writing by each Rating
Agency, as collateral for securities having ratings equivalent to the
ratings of the Rated Securities on the closing date;
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<PAGE>
(g) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation, as approved in writing by each
Rating Agency, as will not result in the qualification, downgrading or
withdrawal of the ratings then assigned to the Rated Securities by each
Rating Agency;
(h) investments in Eligible Investments maintained in "sweep
accounts," short-term asset management accounts and the like utilized
for the investment, on an overnight basis, of residual balances in
investment accounts maintained at the Indenture Trustee or any other
depository institution or trust company organized under the laws of the
United States or any state that is a member of the FDIC the short-term
debt of which has the highest available credit rating of the Rating
Agencies;
(i) guaranteed investment contracts entered into with any
financial institution having a final maturity of not more than one
month from the date of acquisition, the short-term debt securities of
which institution have the Required Rating;
(j) funds classified as money market funds or invested in
money market instruments consisting of: U.S. Treasury bills, other
obligations issued or guaranteed by the U.S. government, its agencies
or instrumentalities; certificates of deposit; banker's acceptances;
and commercial paper (including variable master demand notes);
provided, however, that the fund shall be rated with the highest
available credit rating of Moody's, Standard & Poor's and Fitch and
redemptions shall be permitted on a daily or next business day basis
and including funds to which the Indenture Trustee or any of its
Affiliates is a manager or advisor; and
(k) other investments acceptable to each Rating Agency, as
approved in writing by each Rating Agency, as will not result in the
qualification, downgrading or withdrawal of the ratings then assigned
to any Rated Securities by such Rating Agency.
Notwithstanding anything to the contrary contained in the foregoing
definition:
(a) no Eligible Investment may be purchased at a premium;
(b) any of the foregoing which constitutes a certificated
security shall not be considered an Eligible Investment unless
(1) in the case of a certificated security that is in
bearer form, the Indenture Trustee acquires physical
possession of such certificated security, or a person, other
than a securities intermediary, acquires possession of such
certificated security on behalf of the Indenture Trustee; and
(2) in the case of a certificated security that is in
registered form,
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(A) the Indenture Trustee acquires
physical possession of the certificated
security, a person, other than a securities
intermediary, acquires possession of the
certificated security for the Indenture
Trustee, or a securities intermediary acting
for the Indenture Trustee acquires
possession of the certificated security and
the certificated security has been specially
endorsed to the Indenture Trustee, and
(B) the certificated security is endorsed
to the Indenture Trustee or in blank by an
effective Endorsement, or the certificated
security is registered in the name of the
Indenture Trustee;
(c) any of the foregoing that constitutes an uncertificated
security shall not be considered an Eligible Investment unless
(1) the Indenture Trustee is registered by the issuer
as the owner of the Eligible Investment,
(2) a person, other than a securities intermediary,
becomes the registered owner of the uncertificated security on
behalf of the Indenture Trustee, or
(3) the issuer of the uncertificated security agrees
that it will comply with the instructions originated by the
Indenture Trustee without further consent by any registered
owner of the uncertificated security;
(d) any of the foregoing that constitutes a security
entitlement shall not be considered an Eligible Investment unless the
Indenture Trustee becomes the entitlement holder thereof, or the
securities intermediary has agreed to comply with the entitlement
orders originated by the Indenture Trustee without further consent by
the entitlement holder; and
(e) any of the foregoing shall not constitute an Eligible
Investment unless the Indenture Trustee has given value, and does not
have notice of a materially adverse claim.
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 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 any Rated Securities by such Rating Agency.
"Eligible Receivable" shall mean each Receivable:
(a) which was originated or acquired by World Omni in the
ordinary course of business;
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(b) which arose under an Eligible Account;
(c) which is owned by World Omni at the time of sale by World
Omni to the Transferor;
(d) which represents the obligation of a Dealer to repay an
advance made to or on behalf of such Dealer (i) to finance the
acquisition of Vehicles or (ii) in connection with the Asset Based
Lending Business;
(e) which at the time of creation and at the time of transfer
to the Trust, except at the Initial Closing Date in the case of
Receivables in respect of which the related financed Vehicle has been
sold, is secured by, inter alia, a first priority perfected security
interest in the Vehicle or Vehicles relating thereto;
(f) which was created in compliance in all respects with all
Requirements of Law applicable thereto and pursuant to a Floorplan
Financing Agreement or Asset Based Lending Financing Agreement which
complies in all respects with all Requirements of Law applicable to any
party thereto;
(g) with respect to which all material consents, licenses,
approvals or authorizations of, or registrations or declarations with,
any Governmental Authority required to be obtained, effected or given
by World Omni or the Transferor in connection with the creation of such
Receivable or the transfer thereof to the Trust or the execution,
delivery and performance of the related Floorplan Financing Agreement
or Asset Based Lending Financing Agreement pursuant to which such
Receivable was created, have been duly obtained, effected or given and
are in full force and effect;
(h) as to which at all times following the transfer of such
Receivable to the Trust, the Trust will have good and marketable title
thereto free and clear of all Liens arising prior to the transfer or
arising at any time other than Liens permitted by the Trust Sale and
Security Agreement;
(i) which has been the subject of a valid transfer and
assignment from the Transferor to the Trust of all the Transferor's
right, title and interest therein (including any proceeds thereof);
(j) which will at all times be the legal, valid, binding and
assignable payment obligation of the Dealer relating thereto,
enforceable against such Dealer in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws, now or
hereafter in effect, affecting the enforcement of creditors' rights in
general and except as such enforceability may be limited by general
principles of equity (whether considered in a suit at law or in
equity);
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(k) which at the time of transfer to the Trust is not subject
to any right of rescission, setoff, counterclaim or any other defense
(including defenses arising out of violations of usury laws) of the
Dealer;
(l) as to which, at the time of transfer of such Receivable to
the Trust, World Omni and the Transferor have satisfied all their
respective obligations with respect to such Receivable required to be
satisfied at such time;
(m) as to which, at the time of transfer of such Receivable to
the Trust, neither World Omni nor the Transferor has taken or failed to
take any action which would impair the rights of the Trust, the
Certificateholders or the Noteholders therein;
(n) which constitutes an "instrument," "account," "chattel
paper" or "general intangible" as defined in Article 9 of the UCC as
then in effect in the State of Florida; and
(o) which was transferred to the Trust with all applicable
governmental authorization; and
(p) which is payable in U.S. dollars.
"Eligible Servicer" shall mean World Omni or an entity which, at the
time of its appointment as Servicer, (a) is legally qualified and has the
capacity to service the Accounts, (b) in the sole determination of the Indenture
Trustee, which determination shall be conclusive and binding, has demonstrated
the ability to professionally and competently service a portfolio of similar
accounts in accordance with high standards of skill and care and (c) is
qualified to use the software that is then currently being used to service the
Accounts or obtains the right to use or has its own software which is adequate
to perform its duties under this Agreement.
"Enhancement" shall mean the rights and benefits provided to the
Noteholders of any Series or class pursuant to any letter of credit, surety
bond, cash collateral account, spread account, guaranteed rate agreement,
maturity liquidity facility, tax protection agreement, interest rate swap
agreement or other similar arrangement. The subordination of any Series or class
to any other Series or class or of a portion of the Certificates to any Series
or class shall be deemed to be an Enhancement.
"Enhancement Agreement" shall mean any agreement, instrument or
document governing the terms of any Enhancement or pursuant to which any
Enhancement is issued or outstanding.
"Enhancement Provider" shall mean the Person providing any Enhancement,
other than any Certificateholders whose Certificates are subordinated to any
Series or class of Notes.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"Event of Default" shall mean an event described in Section 5.1 of the
Indenture.
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"Excess Funding Account" shall mean the account designated as such,
established and maintained pursuant to Section 4.2(b) of the Trust Sale and
Servicing Agreement.
"Excess Principal Collections" shall mean, for any day, the aggregate
amount for each Series specified as such in the related Series Supplement.
"Excess Receivables" shall mean, on any Determination Date, an
aggregate amount equal to the sum, without duplication, of (A) the aggregate
amount by which Principal Receivables relating to Used Vehicles exceeds 25% of
the aggregate amount of Principal Receivables included in the Trust calculated
as of the last day of the preceding Collection Period, (B) the aggregate amount
of Principal Receivables as of the last day of the preceding Collection Period
in Eligible Accounts that are on "finance hold" by World Omni as of the last day
of such preceding Collection Period, and (C) the aggregate amount by which
Principal Receivables arising in Eligible Accounts under World Omni's Delayed
Payment Privilege Program exceeds 2% of the aggregate amount of Principal
Receivables included in the Trust as of the last day of the preceding Collection
Period; provided that these percentages and dollar limits may be increased from
time to time upon satisfaction of the Rating Agency Condition.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Excluded Series" shall mean any Series of Notes so designated in the
applicable Series Supplement, if any.
"Executive Officer" shall mean, with respect to any corporation, the
Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, Executive Vice President, any Vice President, the Secretary, the
Treasurer, Assistant Secretary or Assistant Treasurer of such corporation; and
with respect to any partnership, any general partner thereof.
"FDIC" shall mean the Federal Deposit Insurance Corporation or any
successor entity thereto.
"Final Maturity Date" shall mean, with respect to any Series of Notes,
the date specified in any Series Supplement.
"Fitch" shall mean Fitch IBCA, Inc. or its successor.
"Floorplan Financing Agreement" shall mean, collectively, the group of
related agreements between and among World Omni (either as the Originator of a
wholesale financing account or by virtue of assignment of such account to World
Omni by the applicable Originator), the Dealer with respect thereto and, in the
case of new Vehicles, a Vehicle manufacturer or distributor, pursuant to which
(a) World Omni or other applicable Originator agrees to extend credit to such
Dealer to finance used Vehicles and new Vehicles manufactured by such
manufacturer or distributed by such distributor, (b) such Dealer grants to the
applicable Originator a security interest in the specific Vehicles financed by
such Originator, certain other Vehicles, certain other collateral and the
proceeds thereof, (c) such Dealer agrees to repay advances
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made by the applicable Originator at the time of Vehicle sale or lease, and (d)
the obligations of such Dealer to repay such advances is evidenced by one or
more promissory notes of such Dealer.
"Floorplan Financing Guidelines" shall mean the written policies and
procedures of the Originator of an Account, as such policies and procedures may
be amended from time to time, (a) relating to the operation of a floorplan
financing business, including the written policies and procedures for
determining the interest rate charged to Dealers, the other terms and conditions
relating to the applicable Originator's wholesale financing accounts, the
creditworthiness of Dealers and the extension of credit to Dealers, and (b)
relating to the maintenance of accounts and collection of receivables.
"Governmental Authority" shall mean the United States of America, or
any other jurisdiction applicable to the World Omni, the Transferor or other
Originator of the Receivables as specified in the related Series Supplement, any
state, possession, territory or other political subdivision thereof, and any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Holder" shall mean the Person in whose name a Note or Certificate is
registered on the Note Register or the Certificate Register, as applicable.
"Incremental Subordinated Amount" shall mean, with respect to any
Series at any time of determination, an amount equal to the incremental
subordinated amount specified in the related Series Supplement.
"Indenture" shall mean the indenture agreement between the Trust and
the Indenture Trustee, dated as of the date hereof, as the same may from time to
time be amended, modified or otherwise supplemented.
"Indenture Trustee"shall mean Harris Trust and Savings Bank, an
Illinois banking corporation, not in its individual capacity but solely as
trustee under the Indenture, or any successor trustee under the Indenture.
"Independent" shall mean, when used with respect to any specified
Person, that the Person (a) is in fact independent of the Issuer, any other
obligor upon the Notes, the Transferor and any Affiliate of any of the foregoing
Persons, (b) does not have any direct financial interest or any material
indirect financial interest in the Issuer, any such other obligor, the
Transferor or any Affiliate of any of the foregoing Persons and (c) is not
connected with the Issuer, any such other obligor, the Transferor 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" shall mean a certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.1 of the
Indenture, made by an Independent appraiser or other expert appointed by an
Issuer Order and approved by the Indenture Trustee in the exercise of reasonable
care, and such opinion or certificate
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shall state that the signer has read the definition of "Independent" and that
the signer is Independent within the meaning thereof.
"Ineligible Account" shall mean an Account that at the time of
determination is not an Eligible Account.
"Ineligible Amount" shall mean on any Determination Date, the amount of
Ineligible Receivables included in the Trust on the last day of the preceding
Collection Period pursuant to Section 2.9 of the Trust Sale and Servicing
Agreement.
"Ineligible Receivable" shall mean any Receivable that at the time of
determination is not an Eligible Receivable.
"Initial Account" shall mean each individual wholesale financing
account established with a Dealer pursuant to a Floorplan Financing Agreement or
Asset Based Lending Financing Agreement which is identified in the computer file
or microfiche or written list delivered to the Owner Trustee on the Initial
Closing Date by the Transferor pursuant to Section 2.1 of the Trust Sale and
Servicing Agreement.
"Initial Closing Date" shall mean November 22, 1999.
"Initial Cut-Off Date" shall mean October 31, 1999.
"Initial Invested Amount" shall mean, with respect to any Series and
for any date, an amount equal to the initial invested amount specified in the
related Series Supplement. The Initial Invested Amount for any Series may be
increased or decreased from time to time as specified in the related Series
Supplement.
"Insolvency Event" shall mean any event specified in Section 5.17, (b),
(c), (d) or (e) of the Indenture.
"Insolvency Laws" shall mean the Bankruptcy Code and any other
applicable federal or State bankruptcy, insolvency or other similar law.
"Insurance Proceeds" shall mean with respect to an Account, shall mean
any amounts received by the Servicer pursuant to any policy of insurance which
is required to be paid to the applicable Originator pursuant to a Floorplan
Financing Agreement or Asset Based Lending Financing Agreement.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended.
"Invested Amount" shall mean, with respect to any Series and for any
date, an amount equal to the invested amount specified in the related Series
Supplement.
"Investment Company Act" shall mean the Investment Company Act of 1940,
as amended.
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"Investment Event" shall mean, with respect to any Series of Notes, any
event so defined in the Indenture and the related Series Supplement, if any.
"Investment Period" shall mean, with respect to any Series of Notes,
the period specified in the related Series Supplement.
"Involuntary Case" shall have the meaning specified in Article VI of
the Receivables Purchase Agreement.
"Issuer" shall mean the party named as such in the Indenture until a
successor replaces it and, thereafter, the successor and, for purposes of any
provision contained herein and required by the TIA, each other obligor on the
Notes.
"Issuer Order and Issuer Request" shall mean a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and
delivered to the Indenture Trustee.
"Lien" shall mean any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other),
preference, participation interest, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever, including any
conditional sale or other title retention agreement and any financing lease
having substantially the same economic effect as any of the foregoing.
"Manufacturer" shall mean, with respect to any Receivable, the
manufacturer of the Vehicle related to such Receivable.
"Manufacturer Amount" shall mean, on any Determination Date and for
each Manufacturer, the aggregate amount of Principal Receivables related to
Vehicles manufactured by such Manufacturer in Eligible Accounts on the last day
of the preceding Collection Period.
"Manufacturer Limit" shall mean 25% for Ford, General Motors and
DaimlerChrysler and 20% for all other Manufacturers.
"Manufacturer Overconcentration" shall mean, with respect to any
Manufacturer other than Toyota, on any Determination Date, the excess, if any,
of (x) the aggregate Manufacturer Amount over (y) the product of (i) the
Manufacturer Limit and (ii) the Pool Balance on the last day of the preceding
Collection Period.
"Mega-Dealer Group" shall mean for any Determination Date, each Dealer
Group for which the Servicer has designated a Dealer Concentration Limit greater
than 3%.
"Mega-Dealer Manufacturer Amount" shall mean, on any Determination Date
and for each Manufacturer, the aggregate amount of Principal Receivables related
to Vehicles manufactured by such Manufacturer in Eligible Accounts of each of
the Mega-Dealer Groups on the last day of the preceding
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Collection Period; provided, however, that the Mega-Dealer Manufacturer Amount
for Toyota will always be zero.
"Mega-Dealer Group Manufacturer Overconcentration" shall mean, for any
Determination Date, the excess of (1) the sum of the three largest Mega-Dealer
Manufacturer Amounts over (2) 50% of the aggregate amount of Principal
Receivables included in all accounts of each of the Mega-Dealer Groups on the
last day of the preceding Collection Period.
"Minimum Required Pool Balance" shall mean, with respect to any day,
the Required Pool Balance that would result if the Required Pool Balance was
calculated as if the Required Participation Percentage for each Series was 100%.
"Miscellaneous Payments" shall mean, with respect to any Collection
Period, the sum of Adjustment Payments and Transfer Deposit Amounts on deposit
in the Collection Account on the related Payment Date.
"Monthly Payment Rate" shall mean a fraction, the numerator of which is
the amount of Principal Collections for the immediately preceding Collection
Period and the denominator of which is the daily average Pool Balance for such
Collection Period.
"Monthly Servicing Fee" shall mean, with respect to any, Series the
amount specified therefor in the related Series Supplement.
"Moody's" shall mean Moody's Investors Service, Inc., or its successor.
"Nonfloorplan Agreement" shall have the meaning specified in Article
VII of the Receivables Purchase Agreement.
"Non-Principal Collections" shall mean Collections under the
Receivables other than Principal Collections, provided that (i) all Recoveries
and (ii) interest and other investment earnings on funds on deposit in the
Excess Funding Account deposited into the Collections Account shall be
Non-Principal Collections.
"Non-Principal Receivables" with respect to any Account shall mean all
amounts billed to the related Dealer in respect of interest and all other
non-principal charges, including service fees and handling fees.
"Non-Serviced Participation Receivables" shall mean any Purchased
Participation Receivable not serviced by World Omni or any of its Affiliates.
"Note" shall mean any asset-backed Note executed by the Issuer by any
of its Authorized Officers and authenticated by the Indenture Trustee in the
form attached to the Series Supplement applicable to such Series of Notes.
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"Note Depository" shall mean with respect to any Book-Entry Notes for
which Definitive Notes have not been issued, any depository selected from time
to time by the Indenture Trustee on behalf of the Trust in whose name a Series
of Notes is registered. The Note Depository shall be Cede & Co., the nominee of
the Clearing Agency for such Series.
"Note Depository Agreement" shall mean with respect to any Series of
Notes originally issued as Book-Entry Notes, the agreement, dated as of the
Closing Date for such Series, among the Issuer, the Indenture Trustee and the
Clearing Agency relating to such Notes, as the same may be amended and
supplemented from time to time.
"Note Owner" shall mean, with respect to a Book-Entry Note, any person
who is a beneficial owner of a Book-Entry Note.
"Note Rate" shall mean, with respect to any Series or Class, the note
rate specified therefor in the related Series Supplement.
"Note Register" shall have the meaning specified in Section 2.4(a) of
the Indenture.
"Note Registrar" shall mean the registrar at any time of the Note
Register, appointed pursuant to Section 2.4 of the Indenture.
"Noteholder" shall mean any Holder of a Note.
"Noteholders' Monthly Servicing Fee" shall mean the portion of the
Servicing Fee allocable to the Noteholders pursuant to the terms of a Series
Supplement.
"Notice Date" shall have the meaning specified in Section 2.5(c) of the
Trust Sale and Servicing Agreement.
"Notice of Default" shall have the meaning set forth in Section 5.1(d)
of the Indenture.
"Officers' Certificate" shall mean (i) with respect to any corporation,
unless otherwise specified in this Agreement, a certificate signed by (a) the
Chairman of the Board, Vice Chairman of the Board, President or any Vice
President and (b) a Treasurer, Assistant Treasurer, Secretary or Assistant
Secretary of such corporation and (ii) with respect to any limited liability
company, unless otherwise specified in this Agreement, a certificate signed by
any manager of such limited liability company.
"Opinion of Counsel" shall mean a written opinion of counsel, who may,
except for Tax Opinions and as otherwise expressly provided, be an employee of
the Transferor, the Servicer or World Omni. In addition, for purposes of the
Indenture: (a) such counsel shall be satisfactory to the Indenture Trustee, (b)
the opinion shall be addressed to the Indenture Trustee as Trustee and (c) the
opinion shall comply with any applicable requirements of Section 11.1(a) of the
Indenture and shall be in form and substance satisfactory to the Indenture
Trustee.
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"Order" shall have the meaning specified in Article VI of the
Receivables Purchase Agreement.
"Originator" shall mean (i) World Omni and (ii) subject to the prior
approval of the Rating Agencies, such other Person as shall have originated or
underwritten Receivables in the ordinary course of its business under financing
guidelines substantially similar to the Floorplan Financing Guidelines.
"Outstanding" shall mean, with respect to any Notes, as of any
Determination Date, all such Notes theretofore authenticated and delivered under
the Indenture except:
(a) Notes theretofore canceled by the Indenture Trustee or
delivered to the Indenture Trustee for cancellation;
(b) Notes or portions thereof the payment for which money in
the necessary amount has been theretofore deposited with the Indenture Trustee
or any Paying Agent in trust for the Holders of such Notes; provided, however,
that if such Notes are to be redeemed, notice of such redemption has been duly
given pursuant to the Indenture or provision therefore, satisfactory to the
Indenture Trustee, has been made; and
(c) Notes in exchange for or in lieu of other Notes which have
been authenticated and delivered pursuant to this Indenture unless proof
satisfactory to the Indenture Trustee is presented that any such Notes are held
by a bona fide purchaser; provided, however, that in determining whether the
Holders of the requisite Outstanding Amount of the Notes have given any request,
demand, authorization, direction, notice, consent or waiver hereunder or under
any Basic Document, Notes owned by the Issuer, any other obligor upon the Notes,
the Seller or any Affiliate of any of the foregoing Persons shall be disregarded
and deemed not to be Outstanding, except that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that the
Indenture Trustee knows to be so owned shall be so disregarded. Notes so owned
that have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Indenture Trustee the pledgor's
right so to act with respect to such Notes and that the pledgee is not the
Issuer, any other obligor upon the Notes, the Seller or any Affiliate of any of
the forgoing Persons.
"Outstanding Amount" shall mean, as of any date, with respect to any
Series of Notes, the aggregate principal amount of such Notes Outstanding at
such date.
"Overconcentration Amount" on any Determination Date shall mean the
sum, without duplication, of (i) the aggregate Dealer Overconcentrations on such
Determination Date, (ii) the aggregate Manufacturer Overconcentrations on such
Determination Date, (iii) the Asset Based Receivable Overconcentrations on such
Determination Date and (iv) the aggregate Mega-Dealer Group Manufacturer
Overconcentrations on such Determination Date.
"Owner Trust Estate" shall mean all right, title and interest of the
Trust in and to the property and rights assigned to the Trust pursuant to
Article II of the Trust Sale and Servicing Agreement, all funds on deposit from
time to time in the Trust Accounts and the Certificate Distribution Account, the
Enhancement
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Agreements and all other property of the Trust from time to time, including any
rights of the Owner Trustee and the Trust pursuant to the Trust Sale and
Servicing Agreement and the Administration Agreement.
"Owner Trustee" shall mean Chase Manhattan Bank Delaware, a Delaware
banking corporation, or any successor trustee under the Trust Agreement.
"Participation Agreement" shall mean an agreement between World Omni
and a lender (i) pursuant to which World Omni conveys to such lender an
undivided interest in certain receivables that is pari passu in all respects
(other than nonsubordinated interest strips and fees) with the undivided
interest retained by World Omni and (ii) satisfies the applicable requirements
of the Receivables Purchase Agreement.
"Participation Interest" shall mean the undivided interest, created
pursuant to a Participation Agreement, in a receivable in which a Receivable
represents the remaining undivided interest.
"Pay Down Date" shall have the meaning specified in the related Series
Supplement.
"Paying Agent" shall mean with respect to the Indenture, the Indenture
Trustee or any other Person that meets the eligibility standards for the
Indenture Trustee specified in Section 6.11 of the Indenture and is authorized
by the Issuer to make the payments to and distributions from the Collection
Account and any Principal Funding Account, including payment of principal of or
interest on the Notes on behalf of the Issuer. With respect to the Trust
Agreement, any paying agent or co-paying agent appointed pursuant to Section
3.10 of the Trust Agreement that meets the eligibility standards for the Owner
Trustee specified in Section 6.13 of the Trust Agreement.
"Payment Date" shall mean the fifteenth day of each month or, if such
day is not a Business Day, the next succeeding Business Day.
"Payment Date Statement" shall mean, with respect to any Series, a
report prepared by the Servicer on each Determination Date for the immediately
preceding Collection Period in substantially the form set forth in the related
Series Supplement.
"Person" shall mean any legal person, including any individual,
corporation, partnership, limited liability company, association, joint-stock
company, trust, unincorporated organization, governmental entity or other entity
of similar nature.
"Pool Balance" shall mean, as of the time of determination thereof, the
aggregate amount of Principal Receivables, excluding any Defaulted Receivables
after the Payment Date in which it became a Defaulted Receivable in the Trust at
such time, minus the aggregate balance on such date in Dealer accounts in World
Omni's Floorplan Equity Program.
"Predecessor Note" shall mean with respect to any particular Note,
every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purpose of this
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definition, any Note authenticated and delivered under Section 2.5 of the
Indenture in lieu of a mutilated, lost, destroyed or stolen Note.
"Principal Collections" shall mean Collections of principal under the
Receivables.
"Principal Receivables" with respect to an Account shall mean amounts
shown on the Servicer's records as Receivables (other than such amounts which
represent Non-Principal Receivables) payable by the related Dealer.
"Principal Shortfalls" shall mean, for any Collection Period, with
respect to any Series of Notes the amounts specified in the related Series
Supplement, if any.
"Principal Terms" shall mean, with respect to any Series: (a) the name
or designation; (b) the initial principal amount (or method for calculating such
amount); (c) the Note Rate (or method for the determination thereof); (d) the
date on which such Series will begin its Accumulation Period or Controlled
Amortization Period; (e) the method for allocating principal and interest to
Noteholders; (f) the percentage used to calculate Monthly Servicing Fees; (g)
the issuer and terms of any form of Enhancement with respect thereto; (h) the
terms on which the Notes of such Series may be exchanged for Notes of another
Series, repurchased by the Transferor or remarketed to other investors; (i) the
final payment date; and (j) any other terms permitted by the Indenture.
"Proceeding" shall mean any suit in equity, action at law or other
judicial or administrative proceeding.
"Purchase Price" shall mean, with respect to any Receivable for any
date on which such Receivable is to be purchased pursuant to Section 3.3(c) of
the Trust Sale and Servicing Agreement or Section 2.3(c) of the Receivables
Purchase Agreement, as applicable, (a) an amount equal to the amount payable by
the Dealer in respect thereof as reflected in the records of the Servicer as of
the date of purchase plus, without duplication, (b) interest accrued from the
end of the last Collection Period until the day such Receivable is purchased in
respect of which interest on such Receivable was billed by the Servicer, at a
per annum rate equal to the rate being charged to the Dealer under the related
Floorplan Financing Agreement or Asset Based Lending Financing Agreement.
"Purchased Participation Receivable" shall mean World Omni's undivided
interest in certain receivables originated by a third party.
"Rated Securities" shall mean each class of Securities which has been
rated by a Rating Agency at the request of the Transferor.
"Rating Agency" shall mean, with respect to any outstanding Series or
Class, each statistical rating agency selected by the Transferor to rate the
Notes of such Series or Class, unless otherwise specified in the Series
Supplement.
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"Rating Agency Condition" shall mean, with respect to any action, that
each Rating Agency shall have notified the Transferor, the Servicer, the Owner
Trustee and the Indenture Trustee in writing that such action will not result in
a reduction or withdrawal of the rating of any outstanding Series or class with
respect to which it is a Rating Agency, unless otherwise specified in the Series
Supplement.
"Rebate Payment" shall have the meaning specified in Section 3.9(c) of
the Trust Sale and Servicing Agreement.
"Reassignment" shall have the meaning specified in Section 2.7(b) of
the Trust Sale and Servicing Agreement.
"Receivables" shall mean, with respect to an Account, all amounts shown
on the Servicer's records as amounts payable by the related Dealer from time to
time in respect of advances made by World Omni to such Dealer, or advances or
credits made by the related Originator to such Dealer and acquired by World
Omni, in each case to finance Vehicles by such Dealer, together with the group
of writings evidencing such amounts and the security interest created in
connection therewith and shall include any Purchased Participation Receivables;
provided that if a Participation Interest has been created in respect of such
Account, the amounts so payable by the related Dealer that are allocable to such
Participation Interest shall not be a part of the "Receivables" in respect of
such Account. Receivables which become Defaulted Receivables shall not be shown
on the Servicer's records as amounts payable (and will cease to be included as
Receivables) on the day on which they become Defaulted Receivables. Receivables
which World Omni is unable to transfer to the Transferor pursuant to the
Receivables Purchase Agreement or which the Transferor is unable to transfer to
the Trust pursuant to the Trust Sale and Servicing Agreement and Receivables
which arise in Designated Accounts from and after the related Removal
Commencement Date shall not be included in calculating the amount of
Receivables. With respect to the Servicer's obligations or duties as servicer,
Non-Serviced Participation Receivables shall not be included as Receivables for
such purposes.
"Receivables Purchase Agreement" shall mean the agreement between World
Omni and the Transferor, dated as of the date hereof, governing the terms and
conditions upon which the Transferor is acquiring the initial Receivables
transferred to the Trust on the Initial Closing Date and all Receivables
acquired thereafter, as the same may from time to time be amended, modified or
otherwise supplemented.
"Record Date" shall mean, with respect to any Payment Date, the close
of business on the day preceding such Payment Date; provided that with respect
to any Payment Date for a Series for which Notes have been issued pursuant to
the Indenture, subsequent to the issuance of such Notes the Record Date for such
Payment Date shall be the last day of the month preceding the month in which
such Payment Date occurs.
"Recoveries" on any Determination Date shall mean all amounts received,
including Insurance Proceeds, by the Servicer during the Collection Period
immediately preceding such Determination Date with respect to Receivables which
have previously become Defaulted Receivables.
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"Redemption Date" The date specified as such by the Issuer as described
in Sections 10.1 and 10.2 of the Indenture.
"Redemption Price" The price specified in the applicable Series
Supplement.
"Reference Rate" shall mean, with respect to any Receivable, the per
annum rate of interest designated from time to time by the applicable Originator
pursuant to the related Floorplan Financing Agreement or Asset Based Lending
Financing Agreement.
"Removal and Repurchase Date" shall have the meaning specified in
Section 2.7(c) of the Trust Sale and Servicing Agreement.
"Removal and Repurchase Notice Date" shall have the meaning specified
in Section 2.7(c) of the Trust Sale and Servicing Agreement.
"Removal Commencement Date" shall have the meaning specified in Section
2.7(b) of the Trust Sale and Servicing Agreement.
"Removal Date" shall have the meaning specified in Section 2.7(b) (iv)
of the Trust Sale and Servicing Agreement.
"Removal Notice" shall have the meaning specified in Section 2.7(b) of
the Trust Sale and Servicing Agreement.
"Removed Account" shall have the meaning specified in Section 2.7(b) of
the Trust Sale and Servicing Agreement.
"Repurchased Receivables" shall have the meaning specified in Section
2.7 of the Trust Sale and Servicing Agreement.
"Repurchased Receivables Purchase Price" shall have the meaning
specified in Section 2.8(b)(iii) of the Trust Sale and Servicing Agreement.
"Required Participation Percentage" shall mean, with respect to any
Series, the percentage specified therefor in the related Series Supplement.
"Required Pool Balance" shall mean, on any day, an amount equal to (a)
the sum of the amounts for each Series (other than any Series or portion thereof
which is designated in the relevant Series Supplement as being an Excluded
Series until the Invested Amount of the Series relating to the Excluded Series
is reduced to zero) obtained by multiplying the Required Participation
Percentage for such Series by the Invested Amount for such Series at such time
plus (b) the Trust Available Subordinated Amount on such day.
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"Required Rating" shall mean a rating on commercial paper or other
short term unsecured debt obligations of Prime-1 by Moody's so long as Moody's
is a Rating Agency, A-1+ by Standard & Poor's so long as Standard & Poor's is a
Rating Agency and F-1+ by Fitch so long as Fitch is a Rating Agency; and any
requirement that deposits or debt obligations have the "Required Rating" shall
mean that such deposits or debt obligations have the foregoing required ratings
from Moody's, Standard & Poor's and Fitch.
"Requirements of Law" for any Person shall mean the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation, or determination of an
arbitrator or Governmental Authority, in each case applicable to or binding upon
such Person or to which such Person is subject, whether federal, state or local
(including usury laws and the federal Truth in Lending Act).
"Reserve Fund" shall mean the account designated as such and
established and maintained pursuant to a Series Supplement.
"Reset Date" shall mean the last day of a Collection Period and the
Business Day immediately preceding an Advance Date or a Pay Down Date with
respect to any Series.
"Responsible Officer" shall mean, with respect to the Indenture Trustee
or the Owner Trustee, any officer within the Corporate Trust Office (or any
successor group of the Indenture Trustee or Owner Trustee), including any
managing director, vice president, assistant vice president, secretary,
assistant secretary, vice president or any other officer of the Indenture
Trustee customarily performing functions similar to those performed by any of
the above designated officers and also, with respect to a particular matter, any
other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
"Revolving Period" shall mean with respect to any Series, the period
specified as such in the related Series Supplement.
"Securities" shall mean the Notes and the Certificates.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Securityholders" shall mean the Noteholders and the
Certificateholders.
"Series" shall mean any series of Notes so designated in the Series
Supplement.
"Series Account" shall mean any deposit, trust, escrow, reserve or
similar account maintained for the benefit of the Noteholders of any Series or
class, as specified in any Series Supplement.
"Series Adjusted Invested Amount" shall mean, with respect to any
outstanding Series and for any day, the sum of (a) the Initial Invested Amount
of the Notes of such Series on the most recent Reset Date
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and (b) the Target Available Subordinated Amount, if any, with respect to such
Series, on the most recent Reset Date (or the initial Available Subordinated
Amount with respect to any day occurring prior to the first Reset Date following
the related Series Issuance Date).
"Series Allocable Defaulted Amount" shall mean, with respect to any
Series and for any Collection Period, the product of the Weighted Average Series
Allocation Percentage and the Defaulted Amount with respect to such Collection
Period.
"Series Allocable Excess Funding Amount" shall mean, with respect to
any Series and for any day, the product of the Series Allocation Percentage on
such day and the amount on deposit in the Excess Funding Account on such day.
"Series Allocable Miscellaneous Payments" shall mean, with respect to
any Series and for any day, the product of the Series Allocation Percentage for
such day and the amount of Miscellaneous Payments for such day.
"Series Allocable Non-Principal Collections" shall mean, with respect
to any Series and for any day, the product of the Series Allocation Percentage
on such day and the amount of Collections of Non- Principal Receivables
deposited in the Collection Account for such day.
"Series Allocable Principal Collections" shall mean, with respect to
any Series and for any day, the product of the Series Allocation Percentage on
such day and the amount of Collections of Principal Receivables deposited in the
Collection Account for such day.
"Series Allocation Percentage" shall mean, with respect to any Series
and for any day, the percentage equivalent of a fraction, the numerator of which
is the Series Adjusted Invested Amount and the denominator of which is the Trust
Adjusted Invested Amount.
"Series Cut-Off Date" with respect to any Series, shall have the
meaning specified in the related Series Supplement.
"Series Issuance Date" shall mean, with respect to any Series, the date
on which the Notes of such Series are to be originally issued in accordance with
the Indenture and the related Series Supplement.
"Series Supplement" shall mean, with respect to any Series, a
supplement to the Indenture, executed and delivered in connection with the
original issuance of the Notes of such Series pursuant to Section 2.1 of the
Indenture, and all amendments thereof and supplements thereto.
"Servicer" shall mean, initially, World Omni, in its capacity as
Servicer under the Trust Sale and Servicing Agreement, and after any Servicing
Transfer, the Successor Servicer.
"Servicing Default" shall have the meaning specified in Section 7.1 of
the Trust Sale and Servicing Agreement.
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"Servicing Fee" shall have the meaning specified in Section 3.2 of the
Trust Sale and Servicing Agreement.
"Servicing Fee Rate" shall be the rate set forth in the applicable
Series Supplement.
"Servicing Officer" shall mean any officer of the Servicer involved in,
or responsible for, the administration and servicing of the Receivables whose
name appears on a list of servicing officers furnished to the Indenture Trustee
by the Servicer as such list may from time to time be amended.
"Servicing Transfer" shall have the meaning specified in Section 7.1(d)
of the Trust Sale and Servicing Agreement.
"Standard & Poor's" shall mean Standard & Poor's Rating Services, a
division of the McGraw-Hill Companies, Inc. or its successor.
"Specified Trust Termination Date" shall mean December 31, 2020.
"Successor Servicer" shall have the meaning specified in Section 7.2 of
the Trust Sale and Servicing Agreement.
"Supplemental Certificate" shall have the meaning specified in Section
3.4(c) of the Trust Agreement.
"Target Available Subordinated Amount" shall mean, with respect to any
Series and for any day, the Available Subordinated Amount that would result if
the Available Subordinated Amount for each Series was calculated as if the
amount on deposit in the Excess Funding Account was zero and the Incremental
Subordinated Amount was zero.
"Target Invested Amount" shall mean, with respect to any Series and for
any day, the Invested Amount that would result if the Invested Amount for such
Series was calculated as if the amount on deposit in the Excess Funding Account
was zero.
"Tax Opinion" shall mean, with respect to any action, an Opinion of
Counsel to the effect that, for U.S. federal income tax purposes (a) such action
will not cause a taxable event with respect to any Noteholders, (b) in the case
of Section 2.14 of the Indenture, the Notes of the new Series will be
characterized as debt or an interest in a tax partnership (which partnership
will not be treated as a result of issuance of such Notes as a "publicly traded
partnership" within the meaning of Section 7704 of the Code and applicable
Treasury Regulations) and (c) the Trust will not be treated as an association or
publicly traded partnership taxable as a corporation.
"Termination Date" shall mean, with respect to any Series, the
termination date specified in the related Series Supplement.
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"Termination Notice" shall have the meaning specified in Section 7.1 of
the Trust Sale and Servicing Agreement.
"Temporary Notes" shall mean the Notes specified in Section 2.3 of the
Indenture.
"Transfer Date" shall have the meaning specified in Section 2.1 of the
Trust Sale and Servicing Agreement.
"Transfer Deposit Amount" shall mean, with respect to any Receivable
reassigned or assigned to the Transferor or the Servicer, as applicable,
pursuant to Section 2.4(c) or Section 3.3(c) of the Trust Sale and Servicing
Agreement, the amounts specified in such Sections.
"Transferor" shall mean WODFI LLC, a Delaware limited liability
company.
"Transferor's Certificate" shall mean, the Certificate held by the
Transferor.
"Trust" shall mean the World Omni Master Owner Trust, a Delaware
business trust, the corpus of which shall consist of the Trust Assets.
"Trust Accounts" shall mean the Collection Account, the Excess Funding
Account, and any other account so designated in a Series Supplement,
collectively.
"Trust Adjusted Invested Amount" shall mean, at any time of
determination, the sum of the Series Adjusted Invested Amounts for all
outstanding series at such time.
"Trust Agreement" shall mean the trust agreement between the Transferor
and the Owner Trustee, dated as of the date hereof, as the same may from time to
time be amended, modified or otherwise supplemented.
"Trust Assets" shall have the meaning specified in Section 2.1 of the
Trust Sale and Servicing Agreement.
"Trust Available Subordinated Amount" shall mean, at any time of
determination, the sum of the Available Subordinated Amounts, if any, for all
outstanding Series at such time.
"Trust Estate" shall mean all money, instruments, rights and other
property that are subject or intended to be subject to the lien and security
interest of the Indenture for the benefit of the Noteholders and (only to the
extent expressly provided in the Indenture) the Certificateholders (including,
without limitation, the Collateral described in the Granting Clause of the
Indenture), including the proceeds thereof, and any other property and interests
that are pledged to the Indenture Trustee for the benefit of Beneficiaries
pursuant to a supplement to the Trust Sale and Servicing Agreement or otherwise.
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"Trust Incremental Subordinated Amount" on any Determination Date shall
mean the sum of the Overconcentration Amount, the amount of Excess Receivables
and the Ineligible Amount, in each case, on such Determination Date.
"Trust Indenture Act or TIA" shall mean the Trust Indenture Act of
1939, as amended.
"Trust Sale and Servicing Agreement" shall mean the Trust Sale and
Servicing Agreement, dated as of the date hereof between the Servicer, the
Transferor and the Owner Trustee, as amended and supplemented from time to time.
"Trust Termination Date" shall have the meaning specified in Section
7.1 of the Trust Agreement.
"UCC" shall mean the Uniform Commercial Code, as amended from time to
time, as in effect in any specified jurisdiction.
"Unregistered Note" shall mean any Note that has not been registered
under the Securities Act and is subject to the provisions of Section 2.15 of the
Indenture.
"Used Vehicle" shall mean any Vehicle held for sale by a Dealer that is
determined to be a "used" Vehicle in accordance with the Servicer's standard
wholesale servicing practices.
"Variable Funding Increased Cost Amount" shall have the meaning
specified in the Series Supplement, if any.
"Vehicle" shall mean an automobile or light-duty truck.
"Voting Interests" shall mean as of any date, the aggregate outstanding
Certificate Balance of all Certificates; provided, however, that if WODFI and
its affiliates own less than 100% of the Certificates, Certificates owned by
WODFI, the Trust or any Affiliate of WODFI or the Trust (other than the
Transferor) shall be disregarded and deemed not to be outstanding, except that,
in determining whether the Owner Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Certificates that the Owner Trustee knows to be so owned shall be so
disregarded. Certificates so owned that have been pledged in good faith may be
regarded as outstanding if the pledgee establishes to the satisfaction of the
Owner Trustee the pledgor's right so to act with respect to such Certificates
and that the pledgee is not WODFI or the Trust or any Affiliate of WODFI or the
Trust (other than the Transferor).
"Weighted Average Series Allocation Percentage" shall mean, with
respect to any Series and for any Collection Period, the sum of the Series
Allocation Percentages for each day during that Collection Period divided by the
number of days in that Collection Period.
"WODFI" shall mean WODFI LLC, a Delaware limited liability company, and
its successors in interest to the extent permitted hereunder.
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"World Omni" shall mean World Omni Financial Corp., a Florida
corporation, and its successors in interest.
"WOWI" shall mean World Omni Wholesale, Inc., a wholly-owned subsidiary
of World Omni Financial Corp.
31
<PAGE>
APPENDIX A
----------
PART II - RULES OF CONSTRUCTION
(A) Accounting Terms. As used in this Appendix or the Basic Documents,
accounting terms which are not defined, and accounting terms partly
defined, herein or therein shall have the respective meanings given to
them under generally accepted accounting principles. To the extent that
the definitions of accounting terms in this Appendix or the Basic
Documents are inconsistent with the meanings of such terms under
generally accepted accounting principles, the definitions contained in
this Appendix or the Basic Documents will control.
(B) "Hereof," etc. The words "hereof," "herein" and "hereunder" and words
of similar import when used in this Appendix or any Basic Document will
refer to this Appendix or such Basic Document as a whole and not to any
particular provision of this Appendix or such Basic Document; and
Section, Schedule and Exhibit references contained in this Appendix or
any Basic Document are references to Sections, Schedules and Exhibits
in or to this Appendix or such Basic Document unless otherwise
specified. The word "or" is not exclusive.
(C) Reference to Distribution Dates. With respect to any Distribution Date,
the "related Collection Period," and the "related Record Date," will
mean the Collection Period and Record Date, respectively, immediately
preceding such Distribution Date, and the relationships among
Collection Periods and Record Dates will be correlative to the
foregoing relationships.
(D) Number and Gender. Each defined term used in this Appendix or the Basic
Documents has a comparable meaning when used in its plural or singular
form. Each gender-specific term used in this Appendix or the Basic
Documents has a comparable meaning whether used in a masculine,
feminine or gender-neutral form.
(E) Including. Whenever the term "including" (whether or not that term is
followed by the phrase "but not limited to" or "without limitation" or
words of similar effect) is used in this Appendix or the Basic
Documents in connection with a listing of items within a particular
classification, that listing will be interpreted to be illustrative
only and will not be interpreted as a limitation on, or exclusive
listing of, the items within that classification.
32
<PAGE>
APPENDIX B
----------
NOTICE ADDRESSES AND PROCEDURES
All requests, demands, directions, consents, waivers, notices,
authorizations and communications provided or permitted under any Basic Document
to be made upon, given or furnished to or filed with the Transferor, the
Servicer, the Administrator, the Indenture Trustee, the Issuer, the Owner
Trustee or the Rating Agencies shall be in writing, personally delivered, sent
by facsimile with a copy to follow via first class mail, overnight mail or
mailed by certified mail-return receipt requested, and shall be deemed to have
been duly given upon receipt:
(A) in the case of the Transferor, at the following
address:
WODFI LLC
120 N.W. 12th Avenue
Deerfield Beach, FL 33442
Attn: Eric M. Gebhard
with a copy to:
World Omni Financial Corp.
120 N.W. 12th Avenue
Deerfield Beach, FL 33442
Attn: Eric M. Gebhard
(B) in the case of the Servicer or the Administrator, at
the following address:
World Omni Financial Corp.
120 N.W. 12th Avenue
Deerfield Beach, FL 33442
Attn: Eric M. Gebhard
(C) in the case of the Indenture Trustee, at its
Corporate Trust Office,
(D) in the case of the Issuer or the Owner Trustee, to
the Owner Trustee at its Corporate Trust Office,
Chase Manhattan Bank Delaware
1201 North Market Street
8th Floor
Wilmington, DE 19801
Attn: Michael B. McCarthy
33
<PAGE>
with a copy to:
WODFI LLC
120 N.W. 12th Avenue
Deerfield Beach, FL 33442
Attn: Eric M. Gebhard
The Issuer shall promptly transmit any notice received by it from the
Noteholders to the Indenture Trustee and the Indenture Trustee shall
likewise promptly transmit any notice received by it from the
Noteholders to the Issuer.
(E) in the case of Moody's Investors Service, Inc., to:
Moody's Investors Service, Inc.
ABS Monitoring Department
99 Church Street
New York, New York 10007
(F) in the case of Standard & Poor's Ratings Services,
to:
Standard & Poor's Ratings Services
55 Water Street
40th Floor
New York, NY 10041-0003
Attention: Asset Backed Surveillance Department
(G) in the case of Fitch, to:
Fitch IBCA, Inc.
1 State Street Plaza
29th Floor
New York, NY 10004
Attention: Asset Backed Surveillance
or at such other address as shall be designated by such Person in a written
notice to the other parties to this Agreement.
Where any Basic Document provides for notice to Noteholders or
Certificateholders of any condition or event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if it is in writing and
mailed, first-class, postage prepaid or by overnight mail to each Noteholder or
Certificateholder affected by such condition or event, at such Person's address
as it appears on the Note Register or Certificate Register, as applicable, not
later than the latest date, and not earlier than the earliest
34
<PAGE>
date, prescribed in such Basic Document for the giving of such notice. If notice
to Noteholders or Certificateholders is given by mail, neither the failure to
mail such notice nor any defect in any notice so mailed to any particular
Noteholders or Certificateholders shall affect the sufficiency of such notice
with respect to other Noteholders or Certificateholders, and any notice that is
mailed in the manner herein provided shall conclusively be presumed to have been
duly given regardless of whether such notice is in fact actually received.
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<PAGE>
EXHIBIT A
FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS
(As required by Section 2.5(a)(iii) of the Trust Sale and Servicing Agreement).
ASSIGNMENT No. ___ OF RECEIVABLES IN ADDITIONAL ACCOUNTS dated as of
_________, among WODFI LLC ("WODFI"), as seller, World Omni Master Owner Trust
(the "Trust"), as buyer, and World Omni Financial Corp., as servicer (the
"Servicer") pursuant to the Trust Sale and Servicing Agreement referred to
below.
W I T N E S S E T H :
WHEREAS, the Servicer, WODFI and the Trust are parties to an Amended
and Restated Trust Sale and Servicing Agreement dated as of February ___, 2000
(as amended or supplemented, the "Trust Sale and Servicing Agreement"):
WHEREAS, pursuant to the Trust Sale and Servicing Agreement, WODFI
wishes to designate Additional Accounts to be included as Accounts and to convey
the Receivables and Collateral Security of such Additional Accounts, whether now
existing or hereafter created, to the Trust as part of the corpus of the Trust
(as each such term is defined in the Trust Sale and Servicing Agreement); and
WHEREAS the Trust is willing to accept such designation and conveyance
subject to the terms and conditions hereof;
NOW, THEREFORE, WODFI, the Trust and the Servicer hereby agree as
follows:
1. Defined Terms. All capitalized terms used herein shall have
the meanings ascribed to them in Appendix A of the Trust Sale and Servicing
Agreement unless otherwise defined herein. "Addition Date" shall mean, with
respect to the Additional Accounts designated hereby, __________, _____.
2. Designation of Additional Accounts. WODFI hereby delivers
herewith a computer file or microfiche or written list containing a true and
complete list of all such Additional Accounts specifying for each such Account,
as of the Additional Cut-Off Date, its account number, the aggregate amount of
Receivables outstanding in such Account and the aggregate amount of Principal
Receivables in such Account. Such file or list shall, as of the date of this
Assignment, supplement Schedule 1 to the Trust Sale and Servicing Agreement.
3. Conveyance of Receivables.
(a) WODFI does hereby sell, transfer, assign, set over and
otherwise convey, without recourse (except as expressly provided in the Trust
Sale and Servicing Agreement), to the Trust for the
A-1
<PAGE>
benefit of the Securityholders and any Enhancement Providers, on the Addition
Date all of its right, title and interest in, to and under the Receivables in
such Additional Accounts and all Collateral Security with respect thereto, owned
by WODFI and existing at the close of business on the Additional Cut-Off Date
and thereafter created from time to time, all monies due or to become due and
all amounts received with respect thereto and all proceeds of all of the
foregoing (including "proceeds" as defined in Section 9-306 of the UCC as in
effect in the State of Florida) and Recoveries thereof. The foregoing sale,
transfer, assignment, set-over and conveyance does not constitute and is not
intended to result in the creation or an assumption by the Trust of any
obligation of the Servicer, World Omni or any other Person in connection with
the Accounts, the Receivables or under any agreement or instrument relating
thereto, including any obligation to any Dealers.
(b) In connection with such sale, WODFI agrees to record and
file, at its own expense, a financing statement on form UCC-1 (and continuation
statements when applicable) with respect to the Receivables now existing and
hereafter created for the sale of chattel paper, general intangibles or accounts
(as defined in Sections 9-105 and 9-106 of the UCC as in effect in any state
where WODFI's or the Servicer's chief executive offices or books and records
relating to the Receivables are located) meeting the requirements of applicable
state law in such manner and in such jurisdictions as are necessary to perfect
the sale and assignment of the Receivables and the Collateral Security to the
Trust, and to deliver a file- stamped copy of such financing statements or other
evidence of such filing to the Trust on or prior to the Addition Date. In
addition, WODFI shall cause to be timely filed in the appropriate filing office
any form UCC-1 financing statement and continuation statement necessary to
perfect any sale of Receivables to the Trust. The Trust shall be under no
obligation whatsoever to file such financing statement, or a continuation
statement to such financing statement, or to make any other filing under the UCC
in connection with such sale. The parties hereto intend that the sales of
Receivables effected by this Agreement be sales.
(c) In connection with such sale, WODFI further agrees, at its
own expense, on or prior to the Addition Date, to indicate in its computer files
that the Receivables created in connection with the Additional Accounts
designated hereby have been sold and the Collateral Security assigned to the
Trust pursuant to this Assignment for the benefit of the Securityholders and any
Enhancement Providers. In addition, in connection with such sales, WODFI shall
deliver within __ days after the Addition Date to the Owner Trustee all
documents constituting "instruments" (as defined in the UCC as in effect in the
applicable jurisdiction) with such endorsements attached as the Trust may
reasonably require.
4. Acceptance by the Trust. Subject to the satisfaction of the
conditions set forth in Section 6 of this Assignment, the Trust hereby
acknowledges its acceptance of all right, title and interest to the property,
now existing and hereafter created, conveyed to the Trust pursuant to Section
3(a) of this Assignment, and declares that it shall maintain such right, title
and interest, upon the trust herein set forth, for the benefit of the
Securityholders and any Enhancement Providers. The Trust further acknowledges
that, prior to or simultaneously with the execution and delivery of this
Assignment, WODFI delivered to the Trust the computer file or microfiche or
written list relating to the Additional Accounts described in Section 2 of this
Assignment.
A-2
<PAGE>
5. Representations and Warranties of WODFI. WODFI hereby
represents and warrants to the Trust, as of the date of this Assignment and as
of the Addition Date that:
(a) Legal, Valid and Binding Obligation. This Assignment
constitutes a legal, valid and binding obligation of WODFI, enforceable against
WODFI in accordance with its terms, except as such enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect affecting creditors' rights in general
and except as such enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity);
(b) Organization and Good Standing. WODFI is a limited
liability company duly organized and validly existing and in good standing under
the law of the State of Delaware and has, in all material respects, full
corporate power, authority and legal right to own its properties and conduct its
business as such properties are presently owned and such business is presently
conducted, and to execute, deliver and perform its obligations under this
Assignment;
(c) Due Qualification. WODFI is duly qualified to do business
and, where necessary, is in good standing as a foreign corporation (or is exempt
from such requirement) and has obtained all necessary licenses and approvals in
each jurisdiction in which the conduct of its business requires such
qualification except where the failure to so qualify or obtain licenses or
approvals would not have a material adverse effect on its ability to perform its
obligations hereunder;
(d) Eligible Accounts. Each Additional Account designated
hereby is an Eligible Account;
(e) Selection Procedures. No selection procedures believed by
WODFI to be adverse to the interests of the Noteholders, the Certificateholders
or any Enhancement Providers were utilized in selecting the Additional Accounts
designated hereby;
(f) Insolvency. As of the Notice Date and the Addition Date,
WODFI is not insolvent nor, after giving effect to the conveyance set forth in
Section 3 of this Assignment, will it have been made insolvent, nor is it aware
of any pending insolvency;
(g) Valid Transfer. This Assignment constitutes a valid sale,
transfer and assignment to the Trust of all right, title and interest of WODFI
in the Receivables and the related Collateral Security and the proceeds thereof
and upon the filing of the financing statements described in Section 3 of this
Assignment with the Secretary of State of the State of Florida and other
applicable states and, in the case of the Receivables and the Collateral
Security hereafter created and the proceeds thereof, upon the creation thereof,
the Trust shall have a first priority perfected ownership interest in such
property;
(h) Due Authorization. The execution and delivery of this
Assignment and the consummation of the transactions provided for or contemplated
by this Assignment have been duly authorized by WODFI by all necessary action on
the part of WODFI;
A-3
<PAGE>
(i) No Conflict. The execution and delivery of this
Assignment, the performance of the transactions contemplated by this Assignment
and the fulfillment of the terms hereof, will not conflict with, result in any
breach of any of the material terms and provisions of, or constitute (with or
without notice or lapse of time or both) a material default under, any
indenture, contract, agreement, mortgage, deed of trust, or other instrument to
which WODFI is a party or by which it or its properties are bound;
(j) No Violation. The execution and delivery of this
Assignment by WODFI, the performance of the transactions contemplated by this
Assignment and the fulfillment of the terms hereof will not conflict with or
violate any material Requirements of Law applicable to WODFI;
(k) No Proceedings. There are no proceedings or, to the best
knowledge of WODFI, investigations pending or threatened against WODFI before
any Governmental Authority (i) asserting the invalidity of this Assignment, (ii)
seeking to prevent the consummation of any of the transactions contemplated by
this Assignment, (iii) seeking any determination or ruling that, in the
reasonable judgment of WODFI, would materially and adversely affect the
performance by WODFI of its obligations under this Assignment, (iv) seeking any
determination or ruling that would materially and adversely affect the validity
or enforceability of this Assignment or (v) seeking to affect adversely the
income tax attributes of the Trust under the United States federal or any State
income, single business or franchise tax systems;
(l) Record of Accounts. As of the Addition Date, Schedule 1 to
this Assignment is an accurate and complete listing in all material respects of
all the Additional Accounts as of the Additional Cut-Off Date and the
information contained therein with respect to the identity of such Accounts and
the Receivables existing thereunder is true and correct in all material respects
as of the Additional Cut-Off Date;
(m) No Liens. Each Receivable and all Collateral Security
existing on the Addition Date has been conveyed to the Trust free and clear of
any Lien;
(n) All Consents Required. With respect to each Receivable and
all Collateral Security existing on the Addition Date, all material consents,
licenses, approvals or authorizations of or registrations or declarations with
any Governmental Authority required to be obtained, effected or given by WODFI
in connection with the conveyance of such Receivable or Collateral Security to
the Trust, the execution and delivery of this Assignment and the performance of
the transactions contemplated hereby have been duly obtained, effected or given
and are in full force and effect; and
(o) Eligible Receivables. On the Additional Cut-Off Date, each
Receivable conveyed to the Trust as of such date is an Eligible Receivable or,
if such Receivable is not an Eligible Receivable, such Receivable is conveyed to
the Trust in accordance with Section 2.9 of the Trust Sale and Servicing
Agreement.
6. Conditions Precedent. The acceptance of the Trust set forth
in Section 4of this Assignment is subject to the satisfaction, on or prior to
the Addition Date, of the following conditions precedent:
A-4
<PAGE>
(a) Representations and Warranties. Each of the
representations and warranties made by WODFI in Section 5 of this Assignment
shall be true and correct as of the date of this Assignment and as of the
Addition Date;
(b) Agreement. Each of the conditions set forth in Section
2.5(a) of the Trust Sale and Servicing Agreement (other than Sections
2.4(a)(ii), (iii) (vi), (v) and (vii) in the case of Automatic Additional
Accounts designated by WODFI pursuant to Section 2.5(b) of the Trust Sale and
Servicing Agreement) applicable to the designation of the Additional Accounts to
be designated hereby shall have been satisfied; and
(c) Additional Information. WODFI shall have delivered to the
Trust such information as was reasonably requested by the Trust to satisfy
itself as to the accuracy of the representation and warranty set forth in
Section 5(d) of this Assignment.
7. Ratification of Agreement. As supplemented by this
Assignment, the trust Sale and Servicing Agreement is in all respects ratified
and confirmed and the Trust Sale and Servicing Agreement as so supplemented by
this Assignment shall be read, taken and construed as one and the same
instrument.
8. Counterparts. This Assignment may be executed in two or
more counterparts (and by different parties in separate counterparts),each of
which shall be an original but all of which together shall constitute one and
the same instrument.
9. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS OR
ANY OTHER JURISDICTION'S CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
* * * *
A-5
<PAGE>
IN WITNESS WHEREOF, WODFI, Trust and the Servicer have caused this
Assignment to be duly executed and delivered by their respective duly authorized
officers as of the day and the year first above written.
WODFI LLC,
as Transferor
By: ________________________________
Name:
Title:
WORLD OMNI MASTER OWNER TRUST
By: CHASE MANHATTAN BANK
DELAWARE, not in its individual capacity, but
solely as Owner Trustee on behalf of the
Trust
By: ________________________________
Name:
Title:
WORLD OMNI FINANCIAL CORP.,
as Servicer
By: ________________________________
Name:
Title:
A-5
<PAGE>
EXHIBIT B
---------
FORM OF ANNUAL SERVICER'S CERTIFICATE
(As required to be delivered on or before (April 30) of each
calendar year beginning with April 30, 2000, pursuant to
Section 3.5 of the Trust Sale and Servicing Agreement)
WORLD OMNI FINANCIAL CORP.
-----------------------------------------------
WORLD OMNI MASTER OWNER TRUST
-----------------------------------------------
The undersigned, duly authorized representatives of World Omni
Financial Corp. ("WOFCO"), as Servicer, pursuant to the Amended and Restated
Trust Sale and Servicing Agreement dated as of February __, 2000 (as amended and
supplemented, or otherwise modified and in effect from time to time, the
"Agreement"), by and among WODFI LLC, as Transferor, WOFCO, as Servicer, and
World Omni Master Owner Trust, as the Trust, do hereby certify that:
1. WOFCO is, as of the date hereof, the Servicer under the
Agreement.
2. The undersigned are Servicing Officers and are duly
authorized pursuant to the Agreement to execute and deliver this Certificate to
the Rating Agencies, the Owner Trustee, the Indenture Trustee, any Agent and any
Enhancement providers.
3. A review of the activities of the Services during the
calendar year ended December 31, ____, and of its performance under the
Agreement was conducted under our supervision.
4. Based on such review, the Servicer has, to the best of our
knowledge, performed in all material respects all of its obligations under the
Agreement throughout such year and no default in the performance of such
obligations has occurred or is continuing except as set forth in paragraph 5
below.
5. The following is a description of each default in the
performance of the Servicer's obligations under the provisions of the Agreement
known to us to have been made by the Servicer during the year ended December 31,
____, which sets forth in detail the (a) nature of each such default, (b) the
action taken by the Servicer, if any, to remedy each such default and (c) the
current status of each such default: (If applicable, insert "None.")
B-1
<PAGE>
Capitalized terms used but not defined herein are used as
defined in the Agreement.
IN WITNESS WHEREOF, each of the undersigned has duly executed
this Certificate this ____ day of __________.
By:______________________________________
Name:
Title:
By:______________________________________
Name:
Title:
B-2
<PAGE>
EXHIBIT C
FORM OF OPINION OF COUNSEL
Provisions to be included in Opinion of Counsel to be
delivered pursuant to Section 2.5(a)(ix) of the Trust Sale and Servicing
Agreement.
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
opinion of counsel to WODFI LLC ("WODFI"), delivered on any Closing Date.
Capitalized terms used but not defined herein are used as defined in Part I of
Appendix A to the Amended and Restated Trust Sale and Servicing Agreement, dated
as of February __, 2000 (the "Trust Sale and Servicing Agreement"), between
WODFI, as Transferor, and World Omni Master Owner Trust, as the Trust.
1. The Assignment has been duly authorized, executed and
delivered by WODFI, and constitutes the valid and legally binding obligation of
WODFI, enforceable against WODFI in accordance with its terms.
2. Assuming the Receivables in the Additional Accounts are
created under, and are evidenced solely by, Floorplan Financing Agreements, such
Receivables will constitute either "instruments","general intangibles" or
"chattel paper" as defined under Sections 9-105 and 9-106 of the UCC.
3. With respect to Receivables in the Additional Accounts in
existence on the date hereof [and with respect to Receivables in the Additional
Accounts] that come into existence after the date hereof, upon the creation of
such Receivables and the subsequent transfer of such Receivables to the Trust
free and clear of any Liens in accordance with the Trust Sale and Servicing
Agreement and receipt by WODFI of the consideration therefor required pursuant
to the WODFI Agreement, a bankruptcy court having jurisdiction over WODFI (i)
would not be entitled to compel the turnover of such Receivables or the proceeds
thereof to WODFI under Section 542 of the Bankruptcy Code and (ii) would not be
entitled to treat such Receivables or the proceeds thereof as assets included in
the estate of World Omni pursuant to Section 541 of the Bankruptcy Code or
subject to the automatic stay provision of Section 362(a) of the Bankruptcy
Code.
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<PAGE>
EXHIBIT D
---------
FORM OF REASSIGNMENT OF RECEIVABLES
AND ACCOUNTS
(Pursuant to Section 2.7 of the Trust Sale and
Servicing Agreement referred to below)
REASSIGNMENT NO. _____ OF RECEIVABLES, dated as of
__________, _____ (the "Reassignment"), by and between WODFI LLC, a limited
liability company organized and existing under the laws of the State of Delaware
(the "Transferor"), and World Omni Master Owner Trust, a Delaware business trust
(the "Trust"), pursuant to the Trust Sale and Servicing Agreement referred to
below.
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Transferor and the Trust are parties to the
Amended and Restated Trust Sale and Servicing Agreement dated as of February __,
2000 (hereinafter as such agreement may have been, or may from time to time be,
amended, supplemented or otherwise modified, the "Trust Sale and Servicing
Agreement");
WHEREAS, pursuant to the Trust Sale and Servicing Agreement,
the Trust wishes to reconvey to the Transferor all of the Receivables and
proceeds thereof, whether now existing or hereafter created, from the Trust to
the Transferor pursuant to the terms of Section 2.7 of the Trust Sale and
Servicing Agreement (as each such term is defined in the Trust Sale and
Servicing Agreement);
WHEREAS, the Transferor is willing to accept the reconveyance
of the Receivables subject to the terms and conditions hereof;
NOW THEREFORE, the Transferor and the Trust hereby agree as
follows:
1. Defined Terms. All terms defined in the Trust Sale and
Servicing Agreement and used herein shall have such defined meanings when used
herein, unless otherwise defined herein.
"Reassignment Date" shall mean __________ ___, ____.
2. Return of Lists of Accounts. The Trust shall deliver to the
Transferor, not later than three Business Days after the Reassignment Date, each
and every computer file or microfiche list of Accounts delivered to the Trust
pursuant to the terms of the Trust Sale and Servicing Agreement.
3. Conveyance of Receivables.
D-1
<PAGE>
a. The Trust does hereby reconvey to the Transferor, without
recourse, on and after the Reassignment Date, all right, title and interest of
the Trust in, to and under each and every Receivable and related Collateral
Security now existing and hereafter created in the Accounts, all monies due or
to become due with respect thereto, including all proceeds of all of the
foregoing (as defined by the appropriate UCC) of such Receivables.
b. In connection with such transfer, the Trust agrees to
execute and deliver to the Transferor on or prior to the date of this
Reassignment, such UCC termination statements as the Transferor may reasonably
request, evidencing the release by the Trust of its Lien on the Receivables.
4. Counterparts. This Reassignment may be executed in two or
more counterparts (and by different parties on separate counterparts), each of
which shall be an original, but all of which together shall constitute one and
the same instrument.
5. Governing Law. This Reassignment shall be construed in
accordance with the laws of the State of New York.
* * * *
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<PAGE>
IN WITNESS WHEREOF, the undersigned have caused this
Reassignment of Receivables to be duly executed and delivered by their
respective duly authorized officers on the day and year first above written.
WODFI LLC,
as Transferor
By____________________________________
Name:
Title:
WORLD OMNI MASTER OWNER TRUST
By: CHASE MANHATTAN BANK
DELAWARE, not in its individual
capacity, but solely as Owner Trustee on
behalf of the Trust,
By____________________________________
Name:
Title:
D-3
<PAGE>
Schedule 1
LIST OF ACCOUNTS
<PAGE>
Schedule 2
PROCEEDINGS
As part of its regular examination process of the consolidated federal
income tax returns of JM Family Enterprises and its subsidiaries (including
World Omni) for certain prior years, the IRS has reviewed, among other things,
transactions that were consummated between 1990 and 1994 relating to retail
lease contracts and not to wholesale floorplan receivables. The IRS has proposed
treating the lease transactions as sales rather than financings for federal
income tax purposes, which would affect World Omni's depreciation deductions. It
has also proposed treating the origination trust and each securitization trust
created for those transactions as an association taxable as a corporation rather
than a trust for federal income tax purposes. In connection with each
transaction, World Omni received an opinion of tax counsel to the effect that
these transactions were properly treated as financings for federal income tax
purposes and that neither the origination trust nor the relevant securitization
would be treated as an association taxable as a corporation for federal income
tax purposes. While management believes that a challenge by the IRS would be
unsuccessful, we cannot assure you of this result. The IRS has also proposed
changes to a number of other positions that were taken on the tax returns it is
examining.
Management is vigorously defending its positions and believes that the
ultimate resolution of all of the issues will not have a material adverse effect
on securityholders, JM Family Enterprises' or World Omni's operations and
financial condition or the financial condition of the Trust. However, if the IRS
were to prevail on certain of these issues, it could have a material adverse
effect on JM Family Enterprises' or World Omni's operations and financial
condition or the financial condition of the Trust. Nevertheless, management
believes that, even if the IRS were to prevail on all of these issues it would
not result in any material impairment of World Omni's ability to perform its
obligations and its duties as Servicer under the Basic Documents. Management
cannot, however, assure you of this result.
The IRS recently began a routine examination of World Omni's 1995-1997
tax returns. World Omni expects that this examination may include a review of
the 1996 transaction in which World Omni's dealer receivables were securitized.
<PAGE>
Schedule 3
LIST OF TRUST ACCOUNTS
AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT
BETWEEN
WORLD OMNI FINANCIAL CORP.
SELLER
AND
WODFI LLC
BUYER
DATED AS OF __________, 2000
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
ARTICLE I
DEFINITIONS..............................................................................................1
SECTION 1.1 Definitions...................................................................1
ARTICLE II
CONVEYANCE OF RECEIVABLES................................................................................1
SECTION 2.1 Conveyance of Receivables.....................................................1
SECTION 2.2 Representations and Warranties of World Omni Relating to World
Omni and this Agreement.......................................................3
SECTION 2.3 Representations and Warranties of World Omni Relating to the
Receivables...................................................................5
SECTION 2.4 Addition of Accounts..........................................................7
SECTION 2.5 Covenants of World Omni.......................................................8
SECTION 2.6 Removal of Eligible Accounts..................................................9
SECTION 2.7 Removal of Ineligible Accounts...............................................11
SECTION 2.8 Sale of Ineligible Receivables...............................................11
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES.............................................................11
SECTION 3.1 Acceptance of Appointment and Other Matters Relating to the
Servicer.....................................................................11
SECTION 3.2 Servicing Compensation.......................................................11
ARTICLE IV
RIGHTS OF SECURITYHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS...............................................................11
SECTION 4.1 Allocations and Applications of Collections and Other Funds..................11
ARTICLE V
OTHER MATTERS RELATING TO WORLD OMNI....................................................................12
SECTION 5.1 Merger or Consolidation of, or Assumption, of the Obligations of
World Omni...................................................................12
SECTION 5.2 World Omni Indemnification of WODFI..........................................12
SECTION 5.3 World Omni Acknowledgment of Transfers to the Trust..........................12
ARTICLE VI
TERMINATION.............................................................................................13
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ARTICLE VII
INTERCREDITOR PROVISIONS................................................................................13
ARTICLE VIII
MISCELLANEOUS PROVISIONS...............................................................................14
SECTION 8.1 Amendment..........................................................................14
SECTION 8.2 Protection of Right, Title and Interest to Receivables.............................15
SECTION 8.3 Limited Recourse...................................................................16
SECTION 8.4 No Petition Covenant...............................................................16
SECTION 8.5 GOVERNING LAW......................................................................16
SECTION 8.6 Notices............................................................................16
SECTION 8.7 Severability of Provisions.........................................................16
SECTION 8.8 Assignment.........................................................................16
SECTION 8.9 Further Assurances.................................................................17
SECTION 8.10 No Waiver; Cumulative Remedies....................................................17
SECTION 8.11 Counterparts......................................................................17
SECTION 8.12 Third-Party Beneficiaries.........................................................17
SECTION 8.13 Merger and Integration............................................................17
SECTION 8.14 Headings..........................................................................17
SECTION 8.15 Effect of Amendment and Restatement...............................................17
EXHIBITS
Exhibit A Form of Assignment
Exhibit B Form of Enforceability Opinion of Counsel
Exhibit C Form of Bankruptcy Opinion of Counsel
Exhibit D Form of Reassignment
SCHEDULES
Schedule 1 - List of Accounts
Schedule 2 - List of Proceedings
</TABLE>
ii
<PAGE>
THIS RECEIVABLES PURCHASE AGREEMENT was originally made as of
November 22, 1999 (the "Original Receivables Purchase Agreement"), and is
amended and restated effective as of __________, 2000, between WORLD OMNI
FINANCIAL CORP., a Florida corporation ("World Omni"), as seller, and WODFI LLC,
a Delaware limited liability company ("WODFI"), as buyer. In consideration of
the mutual agreements herein contained and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto agree
as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. Certain capitalized terms used in
this Agreement shall have the respective meanings assigned to them in Part I of
Appendix A to the Trust Sale and Servicing Agreement. All references herein to
"the Agreement" or "this Agreement" are to the Receivables Purchase Agreement as
it may be amended and supplemented from time to time, and all references herein
to Articles, Sections and subsections are to Articles, Sections and subsections
of this Agreement unless otherwise specified. The rules of construction set
forth in Part II of Appendix A to the Trust Sale and Servicing Agreement shall
be applicable to this Agreement.
ARTICLE II
CONVEYANCE OF RECEIVABLES
SECTION 2.1 Conveyance of Receivables. By execution of this
Agreement, World Omni does hereby sell, transfer, assign, set over and otherwise
convey, without recourse (except as expressly provided herein), to WODFI on the
Initial Closing Date, in the case of the Initial Accounts, and on the applicable
Addition Date, in the case of Additional Accounts, all of its right, title and
interest in, to and under the Receivables in each Account and all Collateral
Security with respect thereto owned by World Omni at the close of business on
the Initial Cut-Off Date (including all interest thereon accruing after October
31, 1999, whether paid or payable), in the case of the Initial Accounts, and on
the applicable Additional Cut-Off Date, in the case of Additional Accounts, and
all monies due or to become due thereon and all amounts received with respect
thereto and all proceeds of all of the foregoing (including "proceeds" as
defined in Section 9-306 of the UCC as in effect in the State of Florida) and
Recoveries thereof. Subject to Article VI, prior to the earlier of (x) the
occurrence of an Early Amortization Event specified in Section 5.17(b), (c), (d)
or (e) of the Indenture and (y) the Trust Termination Date, as of each Business
Day on which Receivables are created in the Accounts (a "Transfer Date"), World
Omni does hereby sell, transfer, assign, set over and otherwise convey (except
as expressly provided herein) to WODFI, all of its right, title and interest in,
to and under the Receivables in each Account (other than any Receivables created
in any Removed Account from and after the applicable Removal Date) and all
Collateral Security with respect thereto owned by World Omni at the close of
business on such Transfer Date and not theretofore conveyed to WODFI, all monies
due or to become due and all amounts received with respect thereto and all
proceeds of all of the foregoing (including "proceeds" as defined in Section
9-306 of the UCC as in effect in the State of Florida) and Recoveries thereof
and, with respect to any Purchased Participation Receivables, all of its rights,
remedies, powers and privileges with respect to such Receivables
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under the applicable Participation Agreement. The foregoing sale, transfer,
assignment, set-over and conveyance and any subsequent sales, transfers,
assignments, set-overs and conveyances do not constitute, and are not intended
to result in, the creation or an assumption by WODFI of any obligation of the
Servicer, World Omni, or any other Person in connection with the Accounts, the
Receivables or any Participation Interest or under any agreement or instrument
relating thereto (including any Participation Agreement), including any
obligation to any Dealers.
In connection with such sales, World Omni agrees to record and
file, at its own expense, a financing statement on form UCC-1 or any other
applicable form (and continuation statements when applicable) naming World Omni
as "seller" and WODFI as "buyer" thereon with respect to the Receivables now
existing and hereafter created for the sale of chattel paper, general
intangibles or accounts (as defined in Sections 9-105 and 9-106 of the UCC as in
effect in any state where World Omni's or the Servicer's chief executive offices
or books and records relating to the Receivables are located) meeting the
requirements of applicable law in such manner and in such jurisdictions as are
necessary to perfect the sale and assignment of the Receivables and the
Collateral Security to WODFI, and to deliver a file-stamped copy of such
financing statements or other evidence of such filing to WODFI on or prior to
the Initial Closing Date, in the case of Initial Accounts, and (if any
additional filing is so necessary) the applicable Addition Date, in the case of
Additional Accounts. In addition, World Omni shall cause to be timely filed in
the appropriate filing office any form UCC-1 financing statement and
continuation statement necessary to perfect any sale of Receivables to WODFI.
WODFI shall be under no obligation whatsoever to file such financing statement,
or a continuation statement to such financing statement, or to make any other
filing under the UCC in connection with such sales. The parties hereto intend
that the transfers of Receivables effected by this Agreement be sales.
In connection with such sales, World Omni further agrees, at
its own expense, on or prior to the Initial Closing Date, in the case of Initial
Accounts, the applicable Addition Date, in the case of Additional Accounts, and
the applicable Removal Date, in the case of Removed Accounts, (a) to indicate in
its computer files that the Receivables created in connection with the Accounts
(other than Removed Accounts) have been sold, and the Collateral Security
assigned, to WODFI pursuant to this Agreement and sold to the Trust pursuant to
the Trust Sale and Servicing Agreement for the benefit of the Certificateholders
and pledged to the Indenture Trustee under the Indenture for the benefit of the
Noteholders and the other Beneficiaries and (b) to deliver to WODFI a computer
file or microfiche or written list containing a true and complete list of all
such Accounts (other than Removed Accounts) specifying for each such Account, as
of the Initial Cut-Off Date, in the case of Initial Accounts, and the applicable
Additional Cut-Off Date, in the case of Additional Accounts (i) its account
number and (ii) the aggregate amount of Principal Receivables in such Account.
Such file or list, as supplemented from time to time to reflect Additional
Accounts and Removed Accounts, shall be marked as Schedule 1 to this Agreement
and is hereby incorporated into and made a part of this Agreement. In addition,
in connection with such sales, World Omni shall deliver to WODFI all documents
constituting "instruments" (as defined in the UCC as in effect in the applicable
jurisdiction) with such endorsements attached as WODFI may reasonably require.
2
<PAGE>
In consideration for the sale of $758,759,633.60 of Principal
Receivables, together with the Collateral Security and interest thereon,
transferred to WODFI on the Initial Closing Date, WODFI shall pay to World Omni
$596,700,000 in cash. The remaining $162,059,633.60 of Principal Receivables,
together with the Collateral Security and interest thereon, transferred to WODFI
on the Initial Closing Date is a capital contribution to WODFI. The purchase
price for the Receivables sold by World Omni to WODFI on each Addition Date and
on each Transfer Date thereafter shall be a price agreed to by WODFI and World
Omni at the time of acquisition by WODFI, which price shall not, in the opinion
of WODFI, be materially less favorable to WODFI than prices for transactions of
a generally similar character at the time of the acquisition taking into account
the quality of such Receivables and other pertinent factors; provided that such
consideration shall in any event not be less than reasonably equivalent value
therefor. If and to the extent that WODFI shall not have funds available to pay
World Omni the purchase price for the Receivables transferred, an amount equal
to the purchase price for such Receivables shall be deemed to be a capital
contribution from World Omni to WODFI.
SECTION 2.2 Representations and Warranties of World Omni
Relating to World Omni and this Agreement. World Omni hereby represents and
warrants to WODFI as of each Closing Date that:
(a) Organization and Good Standing. World Omni is a
corporation duly organized and validly existing and in good standing under the
law of the State of Florida and has, in all material respects, full corporate
power, authority and legal right to own its properties and conduct its business
as such properties are presently owned and such business is presently conducted,
and to execute, deliver and perform its obligations under this Agreement.
(b) Due Qualification. World Omni is duly qualified to do
business and, where necessary, is in good standing as a foreign corporation (or
is exempt from such requirement) and has obtained all necessary licenses and
approvals in each jurisdiction in which the conduct of its business requires
such qualification except where the failure to so qualify or obtain licenses or
approvals would not have a material adverse effect on its ability to perform its
obligations hereunder.
(c) Due Authorization. The execution and delivery of this
Agreement and the consummation of the transactions provided for or contemplated
by this Agreement have been duly authorized by World Omni by all necessary
corporate action on the part of World Omni.
(d) No Conflict. The execution and delivery of this Agreement,
the performance of the transactions contemplated by this Agreement and the
fulfillment of the terms hereof and thereof, will not conflict with, result in
any breach of any of the material terms and provisions of, or constitute (with
or without notice or lapse of time or both) a material default under, any
indenture, contract, agreement, mortgage, deed of trust, or other instrument to
which World Omni is a party or by which it or its properties are bound.
(e) No Violation. The execution and delivery of this
Agreement, the performance of the transactions contemplated by this Agreement
and the fulfillment of the terms hereof and thereof
3
<PAGE>
applicable to World Omni, will not conflict with or violate any material
Requirements of Law applicable to World Omni.
(f) No Proceedings. Except as disclosed on Schedule 2 hereto,
there are no proceedings or, to the best knowledge of World Omni,
investigations, pending or threatened against World Omni, before any
Governmental Authority (i) asserting the invalidity of this Agreement, (ii)
seeking to prevent the consummation of any of the transactions contemplated by
this Agreement, (iii) seeking any determination or ruling that, in the
reasonable judgment of World Omni, would materially and adversely affect the
performance by World Omni of its obligations under this Agreement, (iv) seeking
any determination or ruling that would materially and adversely affect the
validity or enforceability of this Agreement or (v) seeking to affect adversely
the income tax attributes of the Trust under the United States federal or any
other applicable state, local or foreign jurisdiction's income, single business
or franchise tax systems.
(g) All Consents Required. All appraisals, authorizations,
consents, orders, approvals or other actions of any Person or of any
governmental body or official required in connection with the execution and
delivery of this Agreement, the performance of the transactions contemplated by
this Agreement, and the fulfillment of the terms hereof or thereof, have been
obtained.
(h) Enforceability. This Agreement constitutes a legal, valid
and binding obligation of World Omni enforceable against World Omni in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect affecting the enforcement of creditors' rights
in general and except as such enforceability may be limited by general
principles of equity (whether considered in a suit at law or in equity).
(i) Record of Accounts. As of the Initial Closing Date, in the
case of Initial Accounts, as of the applicable Addition Date, in the case of the
Additional Accounts, and, as of the applicable Removal Date, in the case of
Removed Accounts, Schedule 1 to this Agreement is an accurate and complete
listing in all material respects of all the Accounts as of the Initial Cut-Off
Date, the applicable Additional Cut-Off Date or the applicable Removal Date, as
the case may be, and the information contained therein with respect to the
identity of such Accounts and the Receivables existing thereunder is true and
correct in all material respects as of the Initial Cut-Off Date, such applicable
Additional Cut-Off Date or such Removal Date, as the case may be.
(j) Valid Transfer. This Agreement or, in the case of
Additional Accounts, the related Assignment constitutes a valid sale, transfer
and assignment to WODFI of all right, title and interest of World Omni in the
Receivables and the Collateral Security and the proceeds thereof. Upon the
filing of the financing statements described in Section 2.1 with the Secretary
of State of the State of Florida and, in the case of the Receivables hereafter
created and the proceeds thereof, upon the creation thereof, WODFI shall have a
first priority perfected ownership interest in such property. Except as
otherwise
4
<PAGE>
provided in the Basic Documents, neither World Omni nor any Person claiming
through or under World Omni has any claim to or interest in the Owner Trust
Estate or the Trust Estate.
The representations and warranties set forth in this Section
2.2 shall survive the transfer and assignment of the Receivables to WODFI. Upon
discovery by World Omni or WODFI of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
prompt written notice to the other party.
In the event a breach of any of the representations and
warranties set forth in this Section 2.2 results in the obligation of WODFI to
redeem the Notes pursuant to Section 2.3 of the Trust Sale and Servicing
Agreement and Section 10.1 of the Indenture, World Omni shall repurchase the
Receivables and the Collateral Security and pay to WODFI on the Business Day
preceding the date on which such redemption of Notes is to be made an amount of
cash equal to the amount WODFI is required to deposit into the applicable
Principal Funding Account pursuant to Section 2.3 of the Trust Sale and
Servicing Agreement. The obligation of World Omni to purchase the retransferred
Receivables pursuant to this Section 2.2 shall constitute the sole remedy
against World Omni respecting an event of the type specified in the first
sentence of this paragraph available to WODFI, the Trust and to the Noteholders
(or the Indenture Trustee on behalf of the Noteholders.)
SECTION 2.3 Representations and Warranties of World Omni
Relating to the Receivables.
(a) Representations and Warranties. World Omni hereby
represents and warrants to WODFI that:
(i) Each Receivable and all Collateral Security existing on
the Initial Closing Date or, in the case of Additional Account, on the
applicable Addition Date, and on each Transfer Date, has been conveyed
to WODFI free and clear of any Lien (other than the Lien held by World
Omni subject to Article VII hereof).
(ii) With respect to each Receivable and all Collateral
Security existing on the Initial Closing Date or, in the case of
Additional Accounts, on the applicable Addition Date, and on each
Transfer Date, all consents, licenses, approvals or authorizations of
or registrations or declarations with any Governmental Authority
required to be obtained, effected or given by World Omni in connection
with the conveyance of such Receivable or Collateral Security to WODFI
have been duly obtained, effected or given and are in full force and
effect.
(iii) On the Initial Cut-Off Date and the Initial Closing
Date, each Initial Account is an Eligible Account or in the case of an
Additional Account, on the applicable Additional Cut-Off Date and
Addition Date, each Account or Additional Account is an Eligible
Account.
5
<PAGE>
(iv) On the Initial Closing Date, in the case of the Initial
Accounts, and, in the case of the Additional Accounts, on the
applicable Additional Cut-Off Date, and on each Transfer Date, each
Receivable conveyed to WODFI on such date is an Eligible Receivable or,
if such Receivable is not an Eligible Receivable, such Receivable is
conveyed to WODFI in accordance with Section 2.8.
(v) Each Participation Agreement, if any, relating to
Receivables conveyed by World Omni permits the transfer of such
Receivables to WODFI and the Trust and provides that the undivided
interest of such participant is pari passu in all respects (other than
non-subordinated interest strips and fees) with the remaining undivided
interest in the related Receivables.
(b) Notice of Breach. The representations and warranties set
forth in this Section 2.3 shall survive the transfer and assignment of the
Receivables to WODFI. Upon discovery by World Omni or WODFI of a breach of any
of the representations and warranties set forth in this Section 2.3, the party
discovering such breach shall give prompt written notice to the other party.
(c) Repurchase. In the event any representation or warranty
under Section 2.3(a) is not true and correct as of the date specified therein
with respect to any Receivable or Account and WODFI in connection therewith, is
required to purchase such Receivable or all Receivables in such Account pursuant
to Section 2.4(c) of the Trust Sale and Servicing Agreement, then within 30 days
(or such longer period as may be agreed to by WODFI) of the earlier to occur of
the discovery of any such event by World Omni or WODFI, or receipt by World Omni
or WODFI of written notice of any such event given by the Owner Trustee the
Indenture Trustee, any Agent or Enhancement Providers, World Omni shall
repurchase such Receivable or Receivables which WODFI is required to accept
reassignment pursuant to the Trust Sale and Servicing Agreement on the Business
Day preceding the Determination Date on which such reassignment is to occur.
World Omni shall purchase each such Receivable by making a
payment to WODFI in immediately available funds on the Business Day preceding
the Payment Date on which such reassignment is to occur in an amount equal to
the Purchase Price for such Receivable. Upon payment of the Purchase Price,
WODFI shall automatically and without further action be deemed to sell,
transfer, assign, set over and otherwise convey to World Omni, without recourse,
representation or warranty, all the right, title and interest of WODFI in and to
such Receivable, all Collateral Security and all monies due or to become due
with respect thereto and all proceeds thereof. WODFI shall execute such
documents and instruments of transfer or assignment and take such other actions
as shall reasonably be requested by World Omni to effect the conveyance of such
Receivables pursuant to this Section. The obligation of World Omni to repurchase
any such Receivable shall constitute the sole remedy respecting the event giving
rise to such obligation available to WODFI, the Trust and to the Securityholders
(or the Owner Trustee on behalf of the Certificateholders or the Indenture
Trustee on behalf of the Noteholders).
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<PAGE>
SECTION 2.4 Addition of Accounts.
(a) World Omni may from time to time offer to voluntarily
designate additional Eligible Accounts to be included as Accounts, subject to
the conditions specified in paragraph (b) below. If any such offer is accepted
by WODFI, Receivables and the related Collateral Security from such Additional
Accounts shall be sold to WODFI effective on a date (the "Addition Date")
specified in a written notice provided by World Omni (or the Servicer on its
behalf) to WODFI and any Enhancement Providers specifying the Additional Cut-Off
Date and the Addition Date for such Additional Accounts (the "Addition Notice")
on or before the fifth Business Day but not more than the 30th day prior to the
related Addition Date (the "Notice Date").
(b) World Omni shall be permitted to convey to WODFI the
Receivables and all Collateral Security related thereto in any Additional
Accounts designated by World Omni as such pursuant to Section 2.4(a) only upon
satisfaction of each of the following conditions on or prior to the related
Addition Date; provided, however, conditions (i), (vi) and (viii) below shall be
inapplicable to Accounts designated by WODFI as Automatic Additional Accounts
under Section 2.5(b) of the Trust Sale and Servicing Agreement; provided
further, that if an Additional Account contains Purchased Participation
Receivables, whether or not such Account has been designated as an Automatic
Additional Account, the Rating Agency Condition must be satisfied on or prior to
the related Addition Date:
(i) World Omni shall provide WODFI and any Enhancement
Providers with a timely Addition Notice.
(ii) Such Additional Accounts shall all be Eligible Accounts.
(iii) World Omni shall have delivered to WODFI a duly executed
written assignment (including an acceptance by WODFI) in substantially
the form of Exhibit A (the "Assignment") and the computer file or
microfiche or written list required to be delivered pursuant to Section
2.1.
(iv) World Omni shall have delivered to WODFI for deposit in
the Collection Account all Collections with respect to such Additional
Accounts since the Additional Cut-Off Date.
(v) (A) No selection procedures believed by World Omni to be
adverse to the interests of WODFI or the Beneficiaries were used in
selecting such Additional Accounts; (B) the list of Additional Accounts
delivered pursuant to clause (iii) above is true and correct in all
material respects as of the Additional Cut-Off Date and (C) as of each
of the Notice Date and the Addition Date, neither World Omni, WODFI nor
the Servicer are insolvent nor will have been made insolvent by such
transfer nor are aware of any pending insolvency.
(vi) The Rating Agency Condition shall have been satisfied
with respect to such addition.
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<PAGE>
(vii) The addition of the Receivables arising in such
Additional Accounts shall not result in the occurrence of an Early
Amortization Event or Investment Event.
(viii) World Omni shall have delivered to WODFI and any
Enhancement Providers a certificate of an Executive Officer confirming
the items set forth in paragraphs (ii) through (vii) above.
(ix) On or before each Addition Date, World Omni shall deliver
to WODFI and any Enhancement Providers an Opinion of Counsel for World
Omni with respect to the Receivables in the Additional Accounts
substantially in the form of Exhibit C.
With respect to Automatic Additional Accounts, World Omni
shall deliver to WODFI and any Enhancement Providers an Opinion of Counsel for
the same time periods as the Transferor is required to deliver under Section
2.5(b) of the Trust Sale and Servicing Agreement.
(c) World Omni hereby represents and warrants as of the
applicable Addition Date as to the matters set forth in Section 2.4(b)(v) and
(vii). The representations and warranties set forth in Section 2.4(b)(v) shall
survive the sale and assignment of the respective Receivables and the related
Collateral Security to WODFI. Upon discovery by World Omni or WODFI of a breach
of any of the foregoing representations and warranties, the party discovering
the breach shall give prompt written notice to the other party and to any
Enhancement Providers.
SECTION 2.5 Covenants of World Omni. World Omni hereby
covenants that:
(a) No Liens. Except for the conveyances hereunder and under
the other Basic Documents and the conveyance of Participation Interests pursuant
to the terms of any Participation Agreements, World Omni will not sell, pledge,
assign or transfer to any other Person, or grant, create, incur, assume or
suffer to exist any Lien on, any Receivable or any Collateral Security, whether
now existing or hereafter created, or any interest therein other than a Note or
Certificate (other than the Lien held by World Omni subject to Article VII
hereof) and World Omni shall defend the right, title and interest of WODFI and
the Trust in, to and under the Receivables and the Collateral Security, whether
now existing or hereafter created, against all claims of third parties claiming
through or under World Omni.
(b) Floorplan Financing Agreements, Asset Based Lending
Financing Agreements and Guidelines. World Omni shall comply with and perform
its servicing obligations with respect to the Accounts and Receivables in
accordance with the applicable Floorplan Financing Agreements or Asset Based
Lending Financing Agreements relating to the Accounts and the applicable
Floorplan Financing Guidelines, except insofar as any failure to so comply or
perform would not materially and adversely affect the rights of WODFI, the Trust
the Certificateholders, the Noteholders or any Enhancement Providers. Subject to
compliance with all Requirements of Law, World Omni, in its capacity of
Servicer, may change the terms and provisions of the Floorplan Financing
Agreement, the Asset Based Lending Financing Agreements or the Floorplan
Financing Guidelines in any respect (including the calculation of the amount
8
<PAGE>
or the timing of charge-offs and the rate of the finance charge assessed
thereon) only if such change would be permitted pursuant to Section 3.1(d) of
the Trust Sale and Servicing Agreement.
(c) Account Allocations. In the event that World Omni is
unable for any reason to transfer Receivables to WODFI, then World Omni agrees
that it shall allocate, after the occurrence of such event, payments on each
Account with respect to the principal balance of such Account first to the
oldest principal balance of such Account and to have such payments applied as
Collections in accordance with the terms of the Trust Sale and Servicing
Agreement. The parties hereto agree that Non-Principal Receivables, whenever
created, accrued in respect of Principal Receivables which have been conveyed to
WODFI and by WODFI to the Trust shall continue to be a part of the Trust
notwithstanding any cessation of the transfer of additional Principal
Receivables to WODFI and Collections with respect thereto shall continue to be
allocated and paid in accordance with Section 8.2 of the Indenture.
(d) Delivery of Collections. In the event that World Omni
receives Collections, World Omni agrees to pay the Servicer or any Successor
Servicer all payments received by World Omni in respect of the Receivables as
soon as practicable after receipt thereof by World Omni, but in no event later
than two Business Days after the receipt by World Omni thereof.
(e) Notice of Liens. World Omni shall notify in writing WODFI,
the Owner Trustee and the Indenture Trustee promptly after becoming aware of any
Lien on any Receivable other than the conveyances hereunder or under the Trust
Sale and Servicing Agreement, the Indenture or any Participation Agreement.
(f) Compliance with Law. World Omni hereby agrees to comply in
all material respects with all Requirements of Law applicable to World Omni.
SECTION 2.6 Removal of Eligible Accounts.
(a) On each Determination Date on which Accounts, including
all amounts then held by the Trust or thereafter received by the Trust with
respect to such Accounts, are removed from the Trust pursuant to Section 2.7 of
the Trust Sale and Servicing Agreement, WODFI shall be deemed to have offered to
World Omni automatically and without notice to or action by or on behalf of
WODFI, the right to remove Eligible Accounts from the operation of this
Agreement in the manner prescribed in Section 2.6(b).
(b) To accept such offer and remove Accounts, including all
amounts then held by the Trust or thereafter received by the Trust with respect
to such Accounts, World Omni (or the Servicer on its behalf) shall take the
following actions and make the following determinations:
(i) not less than five Business Days prior to the Removal
Commencement Date, furnish to WODFI, the Owner Trustee, the Indenture
Trustee, any Enhancement Providers and the Rating Agencies a written
notice (the "Removal Notice") specifying the Determination Date (which
may
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be the Determination Date on which such notice is given) on which
removal of the Receivables of one or more Accounts (the "Designated
Accounts") will commence (a "Removal Commencement Date");
(ii) determine on the Removal Commencement Date the aggregate
principal balance of Receivables in respect of each Designated Account
(the "Designated Balance");
(iii) from and after such Removal Commencement Date, cease to
transfer to WODFI any and all Receivables arising in such Designated
Accounts;
(iv) from and after the Removal Commencement Date, allocate
all Principal Collections in respect of each Designated Account, first
to the oldest outstanding principal balance of the Designated Account,
until the Determination Date on which the Designated Balance in the
Designated Account is reduced to zero (the "Removal Date");
(v) on each business day from and after the Removal
Commencement Date to and until the related Removal Date, allocate (A)
to the Trust (to be further allocated pursuant to the Trust Sale and
Servicing Agreement), Non-Principal Collections in respect of each
Designated Account for Receivables in all Designated Accounts
transferred to the Trust and (B) to the Transferor the remainder of the
Non-Principal Collections in the Designated Accounts;
(vi) represent and warrant that the removal of any Eligible
Account on any Removal Date shall not, in the reasonable belief of
World Omni, cause an Early Amortization Event or Investment Event to
occur or cause the Pool Balance to be less than the Required Pool
Balance;
(vii) represent and warrant that no selection procedures
believed by World Omni to be adverse to the interests of the
Certificateholders, the Noteholders or any Enhancement Providers were
utilized in selecting the Accounts to be removed;
(viii) represent and warrant that the removal will not result
in a reduction or withdrawal of the rating of any outstanding Series or
class of Notes; and
(ix) on or before the related Removal Date, deliver to the
Indenture Trustee and any Enhancement Provider an Officer's Certificate
confirming the items set forth in clauses (vi), (vii) and (viii) above.
(c) Subject to Section 2.6(b), and upon the satisfaction of
the conditions therein, on the Removal Date with respect to any such Designated
Accounts, such Designated Accounts shall be deemed removed by operation of this
Agreement for all purposes (a "Removed Account"). After the Removal Date and
upon the written request of the Servicer, WODFI shall deliver to World Omni a
reassignment in substantially the form of Exhibit D (the "Reassignment").
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SECTION 2.7 Removal of Ineligible Accounts. On any date on
which an Account becomes an Ineligible Account (which date will be deemed the
Removal Commencement Date for such Account), the Transferor will commence the
removal of the Account from the Trust by taking each of the actions specified in
clauses (i) through (ix) of Section 2.6(b) for the Ineligible Account.
SECTION 2.8 Sale of Ineligible Receivables. World Omni shall
sell to WODFI on each Transfer Date any and all Receivables arising in any
Eligible Accounts that are Ineligible Receivables, provided that on the Initial
Cut-Off Date or, in the case of Receivables arising in Additional Accounts, on
the related Additional Cut-Off Date, and on the applicable Transfer Date, the
Account in which such Receivables arise is an Eligible Account.
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 3.1 Acceptance of Appointment and Other Matters
Relating to the Servicer.
(a) World Omni agrees to act as the Servicer under this
Agreement and the Trust Sale and Servicing Agreement, and WODFI consents to
World Omni acting as the Servicer. World Omni will have ultimate responsibility
for servicing, managing and making collections on the Receivables and will have
the authority to make any management decisions relating to such Receivables, to
the extent such authority is granted to the Servicer under the Basic Documents.
(b) The Servicer shall service and administer the Receivables
in accordance with the provisions of the Basic Documents.
SECTION 3.2 Servicing Compensation. As full compensation for
its servicing activities hereunder and under the Trust Sale and Servicing
Agreement, the Servicer shall be entitled to receive the Servicing Fee on each
Payment Date. The Servicing Fee shall be paid in accordance with the terms of
the Trust Sale and Servicing Agreement.
ARTICLE IV
RIGHTS OF SECURITYHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.1 Allocations and Applications of Collections and
Other Funds. The Servicer will apply all Collections with respect to the
Receivables and all funds on deposit in the Collection Account as described in
Article IV of the Trust Sale and Servicing Agreement and Article VIII of the
Indenture.
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ARTICLE V
OTHER MATTERS RELATING TO WORLD OMNI
SECTION 5.1 Merger or Consolidation of, or Assumption, of the
Obligations of World Omni. World Omni shall not consolidate with or merge into
any other corporation or convey or transfer its properties and assets
substantially as an entirety to any Person, unless:
(a) the corporation formed by such consolidation or into which
World Omni is merged or the Person which acquires by conveyance or transfer the
properties and assets of World Omni substantially as an entirety shall be a
corporation organized and existing under the laws of the United States of
America or any State or the District of Columbia and, if World Omni is not the
surviving entity, such corporation shall assume, without the execution or filing
of any paper or any further act on the part of any of the parties hereto, the
performance of every covenant and obligation of World Omni hereunder; and
(b) World Omni has delivered to WODFI, the Owner Trustee and
the Indenture Trustee an Officers' Certificate and an Opinion of Counsel each
stating that such consolidation, merger, conveyance or transfer comply with this
Section 5.1 and that all conditions precedent herein provided for relating to
such transaction have been complied with.
SECTION 5.2 World Omni Indemnification of WODFI. World Omni
shall, out of its own funds, indemnify and hold harmless WODFI, from and against
any loss, liability, expense, claim, damage or injury suffered or sustained by
reason of any acts, omissions or alleged acts or omissions arising out of
activities of World Omni pursuant to this Agreement arising out of or based on
the arrangement created by this Agreement and the activities of World Omni taken
pursuant thereto, including any judgment, award, settlement, reasonable
attorneys' fees and other costs or expenses incurred in connection with the
defense of any actual or threatened action, proceeding or claim; provided,
however, that World Omni shall not indemnify WODFI if such acts, omissions or
alleged acts or omissions constitute fraud, gross negligence or wilful
misconduct by WODFI; and provided further, that World Omni shall not indemnify
WODFI for any liabilities, cost or expense of WODFI with respect to any federal,
state or local income or franchise taxes (or any interest or penalties with
respect thereto) required to be paid by WODFI in connection herewith to any
taxing authority. Any indemnification under this Section 5.2 shall survive the
termination of the Agreement.
SECTION 5.3 World Omni Acknowledgment of Transfers to the
Trust. By its execution of the Trust Sale and Servicing Agreement, World Omni
acknowledges that WODFI shall, pursuant to the Trust Sale and Servicing
Agreement, transfer the Receivables purchased hereunder and the Collateral
Security to the Trust and assign its rights associated therewith under this
Agreement to the Trust, subject to the terms and conditions of the Trust Sale
and Servicing Agreement, and that the Trust shall in turn further pledge, assign
or transfer its rights in such property and this Agreement to the Indenture
Trustee under the Indenture.
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ARTICLE VI
TERMINATION
This Agreement will terminate immediately after the Trust
terminates pursuant to the Trust Agreement. In addition, WODFI shall not
purchase Receivables nor shall World Omni designate Additional Accounts if World
Omni shall become an involuntary party to (or be made the subject of) any
proceeding provided for by any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to World Omni or
relating to all or substantially all of its property (an "Involuntary Case") and
such Involuntary Case shall have continued for a period of twenty Business Days
from and including the day of receipt by World Omni at its principal corporate
office of notice of such Involuntary Case; provided that during such twenty
Business Day period, WODFI shall suspend its purchase of Receivables and shall
hold all Collections of Principal Receivables that would have been available to
purchase Receivables in the Collection Account and (a) if by the first Business
Day after such twenty Business Day period, neither World Omni nor WODFI has
obtained an order from the court having jurisdiction of such case or filing
which order approves the continuation of the sale of Receivables by World Omni
to WODFI and which provides that WODFI and any of its transferees (including the
Owner Trustee and the Indenture Trustee) may conclusively rely on such order for
the validity and nonavoidance of such transfer (the "Order"), WODFI shall hold
such Collections in the Collection Account until such time as they may be paid
as elsewhere provided herein and shall not purchase Receivables thereafter, or
(b) if by such first Business Day, World Omni or WODFI has obtained such Order,
World Omni may continue selling Receivables, and WODFI may continue purchasing
Receivables, pursuant to the terms hereof, as modified by the immediately
succeeding sentence. During the period after the twenty Business Day period
described above and before the end of the 60-day period described below, the
purchase price of the Receivables transferred during such period,
notwithstanding anything in this Agreement to the contrary, shall be paid to
World Omni by WODFI in cash not later than the same Business Day of any sale of
Receivables. During such period, Receivables will be considered transferred to
WODFI only to the extent that the purchase price therefor has been paid in cash
on the same Business Day. If an Order is obtained but subsequently is reversed
or rescinded or expires, World Omni shall immediately cease selling Receivables
to WODFI, and WODFI shall immediately cease buying Receivables. World Omni shall
give prompt written notice to each of WODFI, the Owner Trustee and the Indenture
Trustee immediately upon becoming a party to an Involuntary Case. If by the
first Business Day after the 60-day period after such involuntary filing, such
Involuntary Case has not been dismissed, WODFI shall not purchase thereafter
Receivables or designated Additional Accounts for transfer to the Issuer.
ARTICLE VII
INTERCREDITOR PROVISIONS
With respect to a Dealer which is the obligor under
Receivables that have been or will be sold to WODFI hereunder, World Omni may be
or become a lender to such Dealer under an agreement or arrangement (a
"Nonfloorplan Agreement") other than a Floorplan Financing Agreement or Asset
Based Lending Financing Agreement pursuant to which World Omni has been granted
a security interest in the same collateral (the "Common Collateral") in which
the Floorplan Financing Agreement or Asset Based
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Lending Financing Agreement for such Dealer creates a security interest, which
Common Collateral may include the same Vehicle (the "Common Vehicle Collateral")
in which such Floorplan Financing Agreement or Asset Based Lending Financing
Agreement creates a security interest. The Common Collateral other than the
related Common Vehicle Collateral is referred to herein as the "Common
Non-Vehicle Collateral." World Omni agrees that with respect to each Receivable
of each such Dealer (i) the security interest in such Common Vehicle Collateral
granted to World Omni pursuant to any Nonfloorplan Agreement is junior and
subordinate to the security interest created by the related Floorplan Financing
Agreement or Asset Based Lending Financing Agreement, (ii) World Omni has no
legal right to realize upon such Common Vehicle Collateral or exercise its
rights under the Nonfloorplan Agreement in any manner that is materially adverse
to WODFI, the Trust, the Certificateholders or the Noteholders in respect of the
Common Vehicle Collateral until all required payments in respect of such
Receivable under the Floorplan Financing Agreement or Asset Based Lending
Financing Agreement have been paid, and (iii) in realizing upon such Common
Vehicle Collateral, neither WODFI nor the Trust shall have any obligation to
protect or preserve the rights of World Omni in such Common Vehicle Collateral.
WODFI agrees that with respect to each Receivable of each such Dealer (a) the
security interest in such Common Non-Vehicle Collateral created by the Floorplan
Financing Agreement or the Asset Based Lending Financing Agreement and hereby
assigned to WODFI is junior and subordinate to the security interest therein
created by the Nonfloorplan Agreement, (b) WODFI has no legal right to realize
upon such Common Non-Vehicle Collateral or exercise its rights under the
Floorplan Financing Agreement or the Asset Based Lending Financing Agreement in
any manner that is materially adverse to World Omni until all required payments
in respect of the obligation created or secured by the Nonfloorplan Agreement
have been made, and (c) in realizing on such Common Non-Vehicle Collateral,
World Omni shall not be obligated to protect or preserve the rights of WODFI or
the Trust in such Common Non-Vehicle Collateral. The Trust Sale and Servicing
Agreement and the Indenture shall provide that the Trust and the Indenture
Trustee on behalf of the Noteholders is subject to the preceding sentence. If
World Omni in any manner assigns or transfers any rights under, or any
obligation evidenced or secured by, a Nonfloorplan Agreement, World Omni shall
make such assignment or transfer subject to the provisions of this Article VII
and shall require such assignee or transferee to acknowledge that it takes such
assignment or transfer subject to the provisions of this Article VII and to
agree that it will require the same acknowledgment from any subsequent assignee
or transferee.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.1 Amendment. Subject to Article VIII of the Trust
Agreement, this Agreement may be amended from time to time (with prior written
notice to the Rating Agencies and the Indenture Trustee) by a written amendment
duly executed and delivered by World Omni and WODFI.
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SECTION 8.2 Protection of Right, Title and Interest to
Receivables.
(a) World Omni shall cause this Agreement, all amendments
hereto and/or all financing statements and continuation statements and any other
necessary documents covering WODFI's right, title and interest to the
Receivables and Collateral Security (other than the Lien held by World Omni
subject to Article VII hereof) relating thereto to be promptly recorded,
registered and filed, and at all times to be kept recorded, registered and
filed, all in such manner and in such places as may be required by law fully to
preserve and protect the right, title and interest of WODFI hereunder. World
Omni shall deliver to WODFI file-stamped copies of, or filing receipts for, any
document recorded, registered or filed as provided above, as soon as available
following such recording, registration or filing. WODFI shall cooperate fully
with World Omni in connection with the obligations set forth above and will
execute any and all documents reasonably required to fulfill the intent of this
Section 8.2(a).
(b) Within 30 days after World Omni makes any change in its
name, identity or corporate structure which would make any financing statement
or continuation statement filed in accordance with Section 8.2(a) seriously
misleading within the meaning of Section 9-402(7) of the UCC as in effect in the
State of Florida (or, if applicable, the corresponding Section of the UCC as may
be in effect in such other jurisdiction where World Omni's principal executive
offices or books or records relating to the Receivables are located), World Omni
shall give WODFI and any Agent notice of any such change and shall file such
financing statements or amendments as may be necessary to continue the
perfection of WODFI's security interest in the Receivables and the proceeds
thereof.
(c) World Omni will give WODFI prompt written notice of any
relocation of any office at which it keeps records concerning the Receivables or
of its principal executive office and whether, as a result of such relocation,
the applicable provisions of the UCC would require the filing of any amendment
of any previously filed financing or continuation statement or of any new
financing statement and shall file such financing statements or amendments as
may be necessary to perfect or to continue the perfection of WODFI's security
interest in the Receivables and the proceeds thereof. World Omni will at all
times maintain its principal executive offices within the United States of
America.
(d) World Omni will deliver to WODFI:
(i) upon the execution and delivery of each amendment of this
Agreement, an Opinion of Counsel to the effect specified in Exhibit B;
(ii) on each Addition Date on which any Additional Accounts
are to be included as the Accounts pursuant to Section 2.4 hereof, an
Opinion of Counsel as specified in Section 2.4; provided, however, that
no such Opinion of Counsel shall be necessary in the case of Automatic
Additional Accounts as contemplated in Section 2.5 of the Trust Sale
and Servicing Agreement; and
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(iii) on or before April 30 of each year, beginning with April
30, 2000, an Opinion of Counsel dated as of a date during such
four-month period, substantially in the form of Exhibit C.
SECTION 8.3 Limited Recourse. Notwithstanding anything to the
contrary contained herein, the obligations of WODFI hereunder shall not be
recourse to WODFI (or any person or organization acting on behalf of WODFI or
any affiliate, officer or director of WODFI), other than to any assets of WODFI
not pledged to third parties or otherwise encumbered in a manner permitted by
WODFI's Limited Liability Company Agreement; provided, however, that any payment
by WODFI made in accordance with this Section 8.3 shall be made only after
payment in full of any amounts that World Omni is obligated to deposit in the
Collection Account pursuant to this Agreement; provided further that the
Noteholders shall be entitled to the benefits of the subordination of the
Collections allocable to the Certificates to the extent provided in the Series
Supplement.
SECTION 8.4 No Petition Covenant. World Omni hereby covenants
and agrees that it will not at any time institute against WODFI any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law.
SECTION 8.5 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO THE
PRINCIPLES OF CONFLICTS OF LAW THEREOF OR OF ANY OTHER JURISDICTION, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
SECTION 8.6 Notices. All demands, notices and communications
hereunder shall be in writing and shall be delivered as specified in Appendix B
to the Trust Sale and Servicing Agreement.
SECTION 8.7 Severability of Provisions. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreements, provisions
or terms shall be deemed enforceable to the fullest extent permitted, and if not
so permitted, shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Agreement or of the
Notes or rights of the Noteholders.
SECTION 8.8 Assignment. Notwithstanding anything to the
contrary contained herein, this Agreement may not be assigned by World Omni
without the prior consent of WODFI and the Trust. WODFI may assign its rights,
remedies, powers and privileges under this Agreement to the Trust pursuant to
the Trust Sale and Servicing Agreement which may be assigned to the Indenture
Trustee pursuant to the Indenture.
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SECTION 8.9 Further Assurances. World Omni agrees to do and
perform, from time to time, any and all acts and to execute any and all further
instruments required or reasonably requested by WODFI more fully to effect the
purposes of this Agreement, including the execution of any financing statements
or continuation statements relating to the Receivables for filing under the
provisions of the UCC of any applicable jurisdiction.
SECTION 8.10 No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of WODFI, any right, remedy,
power or privilege under this Agreement shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, remedy, power or privilege
under this Agreement 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 by law.
SECTION 8.11 Counterparts. This Agreement may be executed in
two or more counterparts (and by different parties on separate counterparts),
each of which shall be an original, but all of which together shall constitute
one and the same instrument.
SECTION 8.12 Third-Party Beneficiaries. This Agreement will
inure to the benefit of and be binding upon the parties hereto, the Trust, the
Owner Trustee, the Indenture Trustee, the Securityholders, the Enhancement
Providers and their respective successors and permitted assigns. Except as
otherwise provided in this Agreement, no other Person will have any right or
obligation hereunder.
SECTION 8.13 Merger and Integration. Except as specifically
stated otherwise herein, this Agreement sets forth the entire understanding of
the parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived, or supplemented except as provided herein.
SECTION 8.14 Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
SECTION 8.15 Effect of Amendment and Restatement. It is the
intent of the parties hereto that this Receivables Purchase Agreement, as
amended and restated as of __________, 2000, shall as of such date, replace in
its entirety the Original Receivables Purchase Agreement; provided that, with
respect to the period of time from November 22, 1999 through __________, 2000,
the rights and obligations of the parties shall be governed by the Original
Receivables Purchase Agreement; provided further, that the amendment and
restatement of the Original Receivables Purchase Agreement shall not effect any
of the grants, transfers or conveyances contemplated by the Original Receivables
Purchase Agreement to have occurred prior to __________, 2000.
* * * *
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IN WITNESS WHEREOF, World Omni and WODFI have caused this Amended and
Restated Receivables Purchase Agreement to be duly executed by their respective
officers as of the day and year first above written.
WORLD OMNI FINANCIAL CORP.,
Seller
By___________________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
WODFI LLC,
Buyer
By___________________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
<PAGE>
Schedule 1
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List of Accounts
<PAGE>
Schedule 2
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List of Proceedings
As part of its regular examination process of the consolidated federal
income tax returns of JM Family Enterprises and its subsidiaries (including
World Omni) for certain prior years, the IRS has reviewed, among other things,
transactions that were consummated between 1990 and 1994 relating to retail
lease contracts and not to wholesale floorplan receivables. The IRS has proposed
treating the lease transactions as sales rather than financings for federal
income tax purposes, which would affect World Omni's depreciation deductions. It
has also proposed treating the origination trust and each securitization trust
created for those transactions as an association taxable as a corporation rather
than a trust for federal income tax purposes. In connection with each
transaction, World Omni received an opinion of tax counsel to the effect that
these transactions were properly treated as financings for federal income tax
purposes and that neither the origination trust nor the relevant securitization
would be treated as an association taxable as a corporation for federal income
tax purposes. While management believes that a challenge by the IRS would be
unsuccessful, we cannot assure you of this result. The IRS has also proposed
changes to a number of other positions that were taken on the tax returns it is
examining.
Management is vigorously defending its positions and believes that the
ultimate resolution of all of the issues will not have a material adverse effect
on securityholders, JM Family Enterprises' or World Omni's operations and
financial condition or the financial condition of the Trust. However, if the IRS
were to prevail on certain of these issues, it could have a material adverse
effect on JM Family Enterprises' or World Omni's operations and financial
condition or the financial condition of the Trust. Nevertheless, management
believes that, even if the IRS were to prevail on all of these issues it would
not result in any material impairment of World Omni's ability to perform its
obligations and its duties as Servicer under the Basic Documents. Management
cannot, however, assure you of this result.
The IRS recently began a routine examination of World Omni's 1995-1997
tax returns. World Omni expects that this examination may include a review of
the 1996 transaction in which World Omni's dealer receivables were securitized.
<PAGE>
EXHIBIT A
TO RPA
FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS
(As required by Section 2.4(b)(iii) of the Receivables Purchase Agreement)
ASSIGNMENT No. ___ OF RECEIVABLES IN ADDITIONAL ACCOUNTS dated as of
___________, among WODFI LLC ("WODFI"), as buyer, and WORLD OMNI FINANCIAL CORP.
("World Omni"), as seller, pursuant to the Receivables Purchase Agreement
referred to below.
W I T N E S S E T H :
WHEREAS, World Omni and WODFI are parties to an Amended and Restated
Receivables Purchase Agreement dated as of ___________, 2000 (as amended or
supplemented, the "Receivables Purchase Agreement"):
WHEREAS, pursuant to the Receivables Purchase Agreement, World Omni
wishes to designate Additional Accounts to be included as Accounts and to convey
the Receivables and Collateral Security of such Additional Accounts, whether now
existing or hereafter created, to WODFI as part of the corpus of the Trust (as
each such term is defined in the Receivables Purchase Agreement); and
WHEREAS WODFI is willing to accept such designation and conveyance
subject to the terms and conditions hereof;
NOW, THEREFORE, World Omni and WODFI hereby agree as follows:
1. Defined Terms. All capitalized terms used herein shall have
the meanings ascribed to them in Appendix A of the Trust Sale and Servicing
Agreement (as amended or Supplemented, the "Trust Sale and Servicing Agreement")
unless otherwise defined herein. "Addition Date" shall mean, with respect to the
Additional Accounts designated hereby, __________, _____.
2. Designation of Additional Accounts. World Omni hereby
delivers herewith a computer file or microfiche or written list containing a
true and complete list of all such Additional Accounts specifying for each such
Account, as of the Additional Cut-Off Date, its account number, the aggregate
amount of Receivables outstanding in such Account and the aggregate amount of
Principal Receivables in such Account. Such file or list shall, as of the date
of this Assignment, supplement Schedule 1 to the Receivables Purchase Agreement.
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3. Conveyance of Receivables.
a. World Omni does hereby sell, transfer, assign, set over and
otherwise convey, without recourse (except as expressly provided in the
Receivables Purchase Agreement), to WODFI, on the Addition Date all of its
right, title and interest in, to and under the Receivables in such Additional
Accounts and all Collateral Security with respect thereto, owned by World Omni
and existing at the close of business on the Additional Cut-Off Date and
thereafter created from time to time, all monies due or to become due and all
amounts received with respect thereto and all proceeds (including "proceeds" as
defined in Section 9-306 of the UCC as in effect in the State of Florida) and
Recoveries thereof. The foregoing sale, transfer, assignment, set-over and
conveyance does not constitute and is not intended to result in the creation or
an assumption by WODFI of any obligation of the Servicer, World Omni or any
other Person in connection with the Accounts, the Receivables or any
Participation Interest or under any agreement or instrument relating thereto
(including any Participation Agreement), including any obligation to any
Dealers.
b. In connection with such sale, World Omni agrees to record
and file, at its own expense, a financing statement on form UCC-1 (and
continuation statements when applicable) with respect to the Receivables now
existing and hereafter created for the sale of chattel paper, general
intangibles or accounts (as defined in Sections 9-105 and 9-106 of the UCC as in
effect in any state where World Omni's or the Servicer's chief executive offices
or books and records relating to the Receivables are located) meeting the
requirements of applicable state law in such manner and in such jurisdictions as
are necessary to perfect the sale and assignment of the Receivables and the
Collateral Security to WODFI, and to deliver a file-stamped copy of such
financing statements or other evidence of such filing to WODFI on or prior to
the Addition Date. In addition, World Omni shall cause to be timely filed in the
appropriate filing office any form UCC-1 financing statement and continuation
statement necessary to perfect any sale of Receivables to World Omni. WODFI
shall be under no obligation whatsoever to file such financing statement, or a
continuation statement to such financing statement, or to make any other filing
under the UCC in connection with such sale. The parties hereto intend that the
sales of Receivables effected by this Agreement be sales.
c. In connection with such sale, World Omni further agrees, at
its own expense, on or prior to the Addition Date, to indicate in its computer
files that the Receivables created in connection with the Additional Accounts
designated hereby have been sold and the Collateral Security assigned to WODFI
pursuant to this Assignment and sold to the Trust pursuant to the Trust Sale and
Servicing Agreement for the benefit of the Noteholders, the Certificateholders
and any Enhancement Providers. In addition, in connection with such sales, World
Omni shall deliver within 10 days after the Addition Date to WODFI all documents
constituting "instruments" (as defined in the UCC as in effect in the applicable
jurisdiction) with such endorsements attached as WODFI may reasonably require.
A-2
<PAGE>
4. Acceptance by WODFI. Subject to the satisfaction of the
conditions set forth in Section 6 of this Assignment, WODFI hereby acknowledges
its acceptance of all right, title and interest to the property, now existing
and hereafter created, conveyed to WODFI pursuant to Section 3(a) of this
Assignment. WODFI further acknowledges that, prior to or simultaneously with the
execution and delivery of this Assignment, World Omni delivered to WODFI the
computer file or microfiche or written list relating to the Additional Accounts
described in Section 2 of this Assignment.
5. Representations and Warranties of World Omni. World Omni
hereby represents and warrants to WODFI, on behalf of the Trust, as of the date
of this Assignment and as of the Addition Date that:
a. Legal, Valid and Binding Obligation. This Assignment
constitutes a legal, valid and binding obligation of World Omni, enforceable
against World Omni in accordance with its terms, except as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect affecting creditors' rights in
general and except as such enforceability may be limited by general principles
of equity (whether considered in a suit at law or in equity);
b. Organization and Good Standing. World Omni is a corporation
duly organized and validly existing and in good standing under the law of the
State of Florida and has, in all material respects, full corporate power,
authority and legal right to own its properties and conduct its business as such
properties are presently owned and such business is presently conducted, and to
execute, deliver and perform its obligations under this Assignment;
c. Due Qualification. World Omni is duly qualified to do
business and, where necessary, is in good standing as a foreign corporation (or
is exempt from such requirement) and has obtained all necessary licenses and
approvals in each jurisdiction in which the conduct of its business requires
such qualification except where the failure to so qualify or obtain licenses or
approvals would not have a material adverse effect on its ability to perform its
obligations hereunder;
d. Eligible Accounts. Each Additional Account designated
hereby is an Eligible Account;
e. Selection Procedures. No selection procedures believed by
World Omni to be adverse to the interests of the Noteholders, the
Certificateholders or any Enhancement Providers were utilized in selecting the
Additional Accounts designated hereby;
f. Insolvency. As of the Notice Date and the Addition Date,
World Omni is not insolvent nor, after giving effect to the conveyance set forth
in Section 3 of this Assignment, will it have been made insolvent, nor is it
aware of any pending insolvency;
A-3
<PAGE>
g. Valid Transfer. This Assignment constitutes a valid sale,
transfer and assignment to WODFI of all right, title and interest of World Omni
in the Receivables and the related Collateral Security and the proceeds thereof
and upon the filing of the financing statements described in Section 3 of this
Assignment with the Secretary of State of the State of Florida and other
applicable states and, in the case of the Receivables and the related Collateral
Security hereafter created and the proceeds thereof, upon the creation thereof,
WODFI shall have a first priority perfected ownership interest in such property;
h. Due Authorization. The execution and delivery of this
Assignment and the consummation of the transactions provided for or contemplated
by this Assignment have been duly authorized by World Omni by all necessary
corporate action on the part of World Omni;
i. No Conflict. The execution and delivery of this Assignment,
the performance of the transactions contemplated by this Assignment and the
fulfillment of the terms hereof, will not conflict with, result in any breach of
any of the material terms and provisions of, or constitute (with or without
notice or lapse of time or both) a material default under, any indenture,
contract, agreement, mortgage, deed of trust, or other instrument to which World
Omni is a party or by which it or its properties are bound;
j. No Violation. The execution and delivery of this Assignment
by World Omni, the performance of the transactions contemplated by this
Assignment and the fulfillment of the terms hereof will not conflict with or
violate any material Requirements of Law applicable to World Omni;
k. No Proceedings. Except as described in Schedule 2 hereto,
there are no proceedings or, to the best knowledge of World Omni, investigations
pending or threatened against World Omni before any Governmental Authority (i)
asserting the invalidity of this Assignment, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this Assignment, (iii)
seeking any determination or ruling that, in the reasonable judgment of World
Omni, would materially and adversely affect the performance by World Omni of its
obligations under this Assignment, (iv) seeking any determination or ruling that
would materially and adversely affect the validity or enforceability of this
Assignment or (v) seeking to affect adversely the income tax attributes of the
Trust under the United States federal or any State income, single business or
franchise tax systems;
l. Record of Accounts. As of the Addition Date, Schedule 1 to
this Assignment is an accurate and complete listing in all material respects of
all the Additional Accounts as of the Additional Cut-Off Date and the
information contained therein with respect to the identity of such Accounts and
the Receivables existing thereunder is true and correct in all material respects
as of the Additional Cut-Off Date;
m. No Liens. Each Receivable and all Collateral Security
existing on the Addition Date has been conveyed to WODFI free and clear of any
Lien;
n. All Consents Required. With respect to each Receivable and
all Collateral Security existing on the Addition Date, all material consents,
licenses, approvals or authorizations of or registrations
A-4
<PAGE>
or declarations with any Governmental Authority required to be obtained,
effected or given by World Omni in connection with the conveyance of such
Receivable or Collateral Security to the Trust, the execution and delivery of
this Assignment and the performance of the transactions contemplated hereby have
been duly obtained, effected or given and are in full force and effect; and
o. Eligible Receivables. On the Additional Cut-Off Date, each
Receivable conveyed to the Trust as of such date is an Eligible Receivable or,
if such Receivable is not an Eligible Receivable, such Receivable is conveyed to
WODFI in accordance with Section 2.8 of the Receivables Purchase Agreement.
6. Conditions Precedent. The acceptance of WODFI set forth in
Section 4 of this Assignment is subject to the satisfaction, on or prior to the
Addition Date, of the following conditions precedent:
a. Representations and Warranties. Each of the representations
and warranties made by World Omni in Section 5 of this Assignment shall be true
and correct as of the date of this Assignment and as of the Addition Date;
b. Agreement. Each of the conditions set forth in Section
2.4(b) of the Receivables Purchase Agreement (other than Sections 2.4(b)(vi),
(viii) and (ix) in the case of Automatic Additional Accounts designated by World
Omni pursuant to Section 2.5(b) of the Trust Sale and Servicing Agreement)
applicable to the designation of the Additional Accounts to be designated hereby
shall have been satisfied; and
c. Addition Information. World Omni shall have delivered to
WODFI such information as was reasonably requested by WODFI to satisfy itself as
to the accuracy of the representation and warranty set forth in Section 5(d) of
this Assignment.
7. Ratification of Agreement. As supplemented by this
Assignment, the Receivables Purchase Agreement is in all respects ratified and
confirmed and the Receivables Purchase Agreement as so supplemented by this
Assignment shall be read, taken and construed as one and the same instrument.
8. Counterparts. This Assignment may be executed in two or
more counterparts (and by different parties in separate counterparts),each of
which shall be an original but all of which together shall constitute one and
the same instrument.
9. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS OR ANY
OTHER JURISDICTION'S CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
* * * *
A-5
<PAGE>
IN WITNESS WHEREOF, World Omni and WODFI have caused this Assignment
to be duly executed and delivered by their respective duly authorized officers
as of the day and the year first above written.
WORLD OMNI FINANCIAL CORP.,
By:__________________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
WODFI LLC,
By:__________________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
A-6
<PAGE>
EXHIBIT B
TO RPA
FORM OF OPINION OF COUNSEL
(As required by Section 8.2(d)(i) of the Receivables Purchase Agreement)
(a) The Amendment to the Receivables Purchase Agreement, attached
hereto as Schedule 1 (the "Amendment"), has been duly authorized, executed and
delivered by World Omni and constitutes the legal, valid and binding agreement
of World Omni, enforceable in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
from time to time in effect. The enforceability of World Omni's obligations is
also subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
(b) The Amendment has been entered into in accordance with the terms
and provisions of Section 8.1 of the Receivables Purchase Agreement.
B-1
<PAGE>
EXHIBIT C
TO RPA
FORM OF OPINION OF COUNSEL
Provisions to be included in Opinion of Counsel to be delivered
pursuant to Section 2.4 of the Receivables Purchase Agreement.
The opinions set forth below may be subject to all the qualifications,
assumptions, limitations and exceptions taken or made in the opinion of counsel
to World Omni Financial Corp. ("World Omni"), delivered on any Closing Date.
Capitalized terms used but not defined herein are used as defined in Part I of
Appendix A to the Trust Sale and Servicing Agreement, dated as of November 22,
1999 and amended and restated on _________, 2000 (the "Trust Sale and Servicing
Agreement"), between WODFI LLC ("WODFI"), as transferor, and World Omni as
Servicer.
(a) The Assignment has been duly authorized, executed and delivered by
World Omni, and constitutes the valid and legally binding obligation of World
Omni, enforceable against World Omni in accordance with its terms.
(b) Assuming the Receivables in the Additional Accounts are created
under, and are evidenced solely by, Floorplan Financing Agreements, such
Receivables will constitute "either "instruments","general intangibles" or
"chattel paper" as defined under Section 9-105 of the UCC.
(c) With respect to Receivables in the Additional Accounts in existence
on the date hereof [and with respect to Receivables in the Additional Accounts]
that come into existence after the date hereof, upon the creation of such
Receivables and the subsequent transfer of such Receivables to WODFI free and
clear of any Liens in accordance with the Receivables Purchase Agreement and
receipt by World Omni of the consideration therefor required pursuant to the
Receivables Purchase Agreement, a bankruptcy court having jurisdiction over
World Omni (i) would not be entitled to compel the turnover of such Receivables
or the proceeds thereof to World Omni under Section 542 of the Bankruptcy Code
and (ii) would not be entitled to treat such Receivables or the proceeds thereof
as assets included in the estate of World Omni pursuant to Section 541 of the
Bankruptcy Code or subject to the automatic stay provision of Section 362(a) of
the Bankruptcy Code.
C-1
<PAGE>
EXHIBIT D
TO RPA
FORM OF REASSIGNMENT OF RECEIVABLES IN REMOVAL ACCOUNTS
(As required by Section 2.6(c) of the Receivables Purchase Agreement referred
to below)
REASSIGNMENT NO. ____ OF RECEIVABLES, dated as of______________, by and between
WODFI LLC ("WODFI"), as buyer, and WORLD OMNI FINANCIAL CORP. ("World Omni"), as
seller, pursuant to the Receivables Purchase Agreement referred to below.
W I T N E S S E T H:
WHEREAS World Omni and WODFI are parties to the Amended and Restated
Receivables Purchase Agreement dated as of __________, 2000 (as amended or
supplemented, the "Receivables Purchase Agreement");
WHEREAS, pursuant to the Receivables Purchase Agreement, World Omni
wishes to remove all Receivables from certain Accounts and the Collateral
Security thereof (the "Removed Accounts") and to cause WODFI to reconvey the
Receivables of such Removal Accounts and such Collateral Security, whether now
existing or hereafter created, and all amounts currently held by WODFI or
thereafter received by the Trust in respect of such Removed Accounts, from WODFI
to World Omni (as each such term is defined in the Receivables Purchase
Agreement); and
WHEREAS WODFI is willing to accept such removal and to reconvey the
Receivables in the Removed Accounts, such Collateral Security and any related
amounts held or received by the Trust subject to the terms and conditions
hereof.
NOW, THEREFORE, World Omni and WODFI hereby agree as follows:
1. Defined Terms. All terms defined in the Receivables
Purchase Agreement and used herein shall have such defined meanings when used
herein, unless otherwise defined herein.
"Removal Date" shall mean, with respect to the Removal Accounts
designated hereby, ________________, ____.
C-2
<PAGE>
2. Notice of Removal Accounts.
a. Not less than five Business Days prior to the Removal Date,
World Omni shall furnish to WODFI, any Agent, any Enhancement Providers and the
Rating Agencies a written notice specifying the Determination Date (which may be
the Determination Date on which such notice is given) on which removal of the
Receivables of one or more Accounts will occur, such date being a Removal Date.
b. On or before the fifth business day after the Removal Date,
World Omni shall furnish to the Owner Trustee and the Indenture Trustee a
computer file, microfiche list or other list of the Removed Accounts that were
removed on the Removal Date, specifying for each Removed Accounts as of the date
of the Removal Notice its number, the aggregate amount outstanding in such
Removed Accounts and the aggregate amount of Principal Receivables therein and
represent that such computer file, microfiche list or other list of the Removed
Accounts is true and complete in all material respects. Such file or list shall
be marked as Schedule 1 to this Reassignment and shall be incorporated into and
made a part of this Reassignment as of the Removal Date and shall amend Schedule
1 to the Receivables Purchase Agreement.
3. Conveyance of Receivables and Accounts.
a. WODFI does hereby transfer, assign, set over and otherwise
convey to World Omni, without recourse, representation or warranty on and after
the Removal Date, all right, title and interest of the Trust in, to and under
all Receivables now existing at the close of business on the Removal Date and
thereafter created from time to time until the termination of the Trust in
Removed Accounts designated hereby, all Collateral Security thereof, all monies
due or to become due and all amounts received with respect thereto (including
all Non-Principal Receivables), all proceeds (as defined in Section 9-306 of the
UCC as in effect in the State of Florida and Recoveries) thereof relating
thereto.
b. If requested by World Omni, in connection with such
transfer, WODFI agrees to execute and deliver to World Omni on or prior to the
date of this Reassignment, a termination statement with respect to the
Receivables existing at the close of business on the Removal Date and thereafter
created from time to time and Collateral Security thereof in the Removed
Accounts reassigned hereby (which may be a single termination statement with
respect to all such Receivables and Collateral Security) evidencing the release
by the Trust of its lien on the Receivables in the Removed Accounts and the
Collateral Security, and meeting the requirements of applicable state law, in
such manner and such jurisdictions as are necessary to remove such lien.
4. Acceptance by WODFI. WODFI hereby acknowledges that, prior
to or simultaneously with the execution and delivery of this Reassignment, World
Omni delivered to WODFI the computer file or such microfiche or written list
described in Section 2(b) of this Reassignment.
C-3
<PAGE>
5. Representations and Warranties of World Omni. World Omni
hereby represents and warrants to WODFI as of the date of this Reassignment and
as of the Removal Date:
a. Legal, Valid and Binding Obligation. This Reassignment
constitutes a legal, valid and binding obligation of World Omni, enforceable
against World Omni in accordance with its terms except as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect affecting the enforcement of
creditors' rights generally and except as such enforceability may be limited by
general principles of equity (whether considered in a suit at law or in equity);
b. No Early Amortization Event or Investment Event. The
removal of the Accounts hereby removed shall not, in the reasonable belief of
World Omni, cause an Early Amortization Event or Investment Event to occur or
cause the Pool Balance to be less than the Required Pool Balance;
c. Selection Procedures. No selection procedures believed by
World Omni to be adverse to the interests of the Noteholders, Certificateholders
or any Enhancement Providers were utilized in selecting the Accounts to be
removed; and
d. True and Complete List. The list of Removed Accounts
described in Section 2(b) of this Assignment is, as of the Removal Date, true
and complete in all material respects.
Provided, however, that in the event that the removal on such Removal Date
relates solely to Ineligible Accounts, World Omni shall be deemed to make only
the representations and warranties contained in paragraph 5(a) above.
6. Condition Precedent. In addition to the conditions
precedent set forth in Section 2.6 of the Receivables Purchase Agreement, the
obligation of WODFI to execute and deliver this Reassignment is subject to World
Omni having delivered on or prior to the Removal Date to WODFI, any Agent, the
Owner Trustee, the Indenture Trustee and any Enhancement Providers an Officers`
Certificate certifying that (i) as of the Removal Date, all requirements set
forth in Section 2.6 of the Receivables Purchase Agreement for removing such
Accounts and reconveying the Receivables of such Removal Accounts and the
Collateral Security, whether existing at the close of business on the Removal
Date or thereafter created from time to time until the termination of the Trust,
have been satisfied, and (ii) each of the representations and warranties made by
World Omni in Section 5 hereof is true and correct as of the date of this
Reassignment and as of the Removal Date. WODFI may conclusively rely on such
Officers' Certificate, shall have no duty to make inquiries with regard to the
matters set forth therein and shall incur no liability in so relying.
7. Ratification of Agreement. As supplemented by this
Reassignment, the Receivables Purchase Agreement as so supplemented by this
Reassignment shall be read, taken and construed as one and the same instrument.
C-4
<PAGE>
8. Counterparts. This Reassignment may be executed in two or
more counterparts, and by different parties on separate counterparts, each of
which shall be an original, but all of which shall constitute one and the same
instrument.
9. GOVERNING LAW. THIS REASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS OR
ANY OTHER JURISDICTION'S CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
* * * *
C-5
<PAGE>
IN WITNESS WHEREOF, the undersigned have caused this Reassignment to
be duly executed and delivered by their respective duly authorized officer on
the day and year first above written.
WORLD OMNI FINANCIAL CORP.,
By:____________________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
WODFI LLC,
By:__________________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
C-6
- --------------------------------------------------------------------------------
ADMINISTRATION AGREEMENT
AMONG
WORLD OMNI MASTER OWNER TRUST
ISSUER
AND
WORLD OMNI FINANCIAL CORP.
ADMINISTRATOR
AND
HARRIS TRUST AND SAVINGS BANK
INDENTURE TRUSTEE
DATED AS OF NOVEMBER 22, 1999
- --------------------------------------------------------------------------------
<PAGE>
THIS ADMINISTRATION AGREEMENT is made as of November 22, 1999,
among WORLD OMNI MASTER OWNER TRUST, a Delaware business trust (the "Issuer"),
WORLD OMNI FINANCIAL CORP., a Florida corporation, as administrator (the
"Administrator"), and HARRIS TRUST AND SAVINGS BANK, an Illinois banking
corporation, not in its individual capacity but solely as Indenture Trustee (the
"Indenture Trustee").
WITNESSETH:
WHEREAS, the Issuer is issuing the 1999-VFN Asset Backed Notes
(the "VFN's") on the date hereof and may in the future issue additional Notes,
in each case, pursuant to the Indenture between the Issuer and the Indenture
Trustee;
WHEREAS, the Issuer is issuing on the date hereof the
Transferor's Certificate and may in the future issue additional Certificates, in
each case, pursuant to the Trust Agreement;
WHEREAS, the Issuer has entered into (or assumed) certain
agreements in connection with the issuance of the Notes and the Certificates,
including (i) the Trust Sale and Servicing Agreement, (ii) the Indenture and
(iii) the Trust Agreement;
WHEREAS, pursuant to the Basic Documents, the Issuer and Chase
Manhattan Bank Delaware, as Owner Trustee, are required to perform certain
duties in connection with (i) the Notes, (ii) the Collateral and (iii) the
Certificates;
WHEREAS, the Issuer and the Owner Trustee desire to have the
Administrator perform certain of the duties of the Issuer and the Owner Trustee
referred to in the preceding clause, and to provide such additional services
consistent with the terms of this Agreement and the Basic Documents as the
Issuer and the Owner Trustee may from time to time request; and
WHEREAS, the Administrator has the capacity to provide the
services required hereby and is willing to perform such services for the Issuer
and the Owner Trustee on the terms set forth herein.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, the parties agree as follows:
1. Certain Definitions. Certain capitalized terms used in this
Agreement are defined in and shall have the respective meanings assigned to them
in Part I of Appendix A to the Trust Sale and Servicing Agreement dated as of
November 22, 1999 among the Issuer, the Transferor and World Omni Financial
Corp., as Servicer (the "Trust Sale and Servicing Agreement"). The rules of
construction set forth in Part II of Appendix A to the Trust Sale and Servicing
Agreement shall be applicable to this Agreement. All references herein to "the
Agreement" or "this Agreement" are to this Administration Agreement, as it may
be amended, supplemented or modified from time to
<PAGE>
time, and all references herein to Sections are to Sections of this Agreement
unless otherwise specified.
2. Duties of the Administrator.
(a) Duties with Respect to the Depository Agreement and the
Indenture.
(i) The Administrator agrees to perform all its duties as
Administrator and the duties of the Issuer under the Indenture and any
Depository Agreement. In addition, the Administrator shall consult with
the Owner Trustee regarding the duties of the Issuer under the
Indenture and any Depository Agreement. The Administrator shall monitor
the performance of the Issuer and shall advise the Owner Trustee when
action is necessary to comply with the Issuer's duties under the
Indenture and any Depository Agreement. The Administrator shall prepare
for execution by the Issuer or shall cause the preparation by other
appropriate persons of all such documents, reports, filings,
instruments, certificates, notices and opinions as it shall be the duty
of the Issuer to prepare, file or deliver pursuant to the Indenture and
any Depository Agreement. In furtherance of the foregoing, the
Administrator shall take all appropriate action that it is the duty of
the Issuer to take pursuant to the Indenture including, such of the
foregoing as are required with respect to the following matters under
the Indenture (references are to sections of the Indenture):
(A) the preparation of (or obtaining of) the
documents and instruments required for issuance of the Notes
(if not prepared or obtained by the Issuer), including the
Series Supplement and the Opinion of Counsel to be delivered
in connection with the issuance of each series of Notes, the
coordination with the holders of any variable funding Note of
any borrowings thereunder and all matters relating to such
borrowings, and the preparation of (or obtaining of) the
documents and instruments required for authentication of the
Notes and delivery of the same to the Indenture Trustee
(Section 2.1);
(B) the duty to cause the Note Register to be kept
and to give the Indenture Trustee notice of any appointment of
a new Note Registrar and the location, or change in location,
of the Note Register (Section 2.4);
(C) the notification of the Indenture Trustee of the
final principal payment on the Notes (Section 2.7(c));
(D) the preparation, obtaining or filing of the
instruments, opinions and certificates and other documents
required for the release of Collateral (Section 2.9);
(E) the preparation of Definitive Notes and arranging
the delivery thereof (Section 2.12);
- 2 -
<PAGE>
(F) the maintenance directly or through a third party
agent of an office in the Borough of Manhattan, the City of
New York, for registration of transfer or exchange of Notes
(Section 3.2);
(G) the duty to cause newly appointed Paying Agents,
if any, to deliver to the Indenture Trustee the instrument
specified in the Indenture regarding funds held in trust
(Section 3.3);
(H) the direction to the Indenture Trustee to deposit
monies with Paying Agents, if any, other than the Indenture
Trustee (Section 3.3);
(I) the obtaining and preservation of the Issuer's
qualification to do business in each jurisdiction in which
such qualification is or shall be necessary to protect the
validity and enforceability of the Indenture, the Notes, the
Collateral and each other instrument and agreement included in
the Trust Estate (Section 3.4);
(J) the preparation of all supplements, amendments,
financing statements, continuation statements, assignments,
certificates, instruments of further assurance and other
instruments, in accordance with Section 3.5 of the Indenture,
necessary to protect the Trust Estate and advising the Owner
Trustee with regard to delivery of documents consisting of
"instruments" (Section 3.5);
(K) the delivery of the Opinion of Counsel on the
Initial Closing Date, in accordance with Section 3.6 of the
Indenture, as to the Trust Estate, and the annual delivery of
the Officers' Certificate, in accordance with Section 3.9 of
the Indenture, as to compliance with the Indenture (Sections
3.6 and 3.9);
(L) the identification to the Indenture Trustee in an
Officers' Certificate of a Person with whom the Issuer has
contracted to perform its duties under the Indenture (Section
3.7(b));
(M) the solicitation of the Indenture Trustee's
consent in connection with the proposed waiver, amendment,
modification, supplementation or termination of any Basic
Documents or any provision thereof (Section 3.7(c));
(N) the notification of the Indenture Trustee and the
Rating Agencies of a Servicing Default under the Trust Sale
and Servicing Agreement and, if such Servicing Default arises
from the failure of the Servicer to perform any of its duties
under the Trust Sale and Servicing Agreement, the taking of
all reasonable steps available to remedy such failure (Section
3.7(d));
(O) the delivery of an Officer's Certificate and an
Opinion of Counsel in connection with the consolidation or
merger of the Issuer (Section 3.10(a));
- 3 -
<PAGE>
(P) the preparation and obtaining of documents and
instruments required for the release of the Issuer from its
obligations under the Indenture (Section 3.11(b));
(Q) the delivery of notice to the Indenture Trustee
and the Rating Agencies of each Event of Default under the
Indenture, each Servicing Default, any Insolvency Event with
respect to the Transferor, each default on the part of the
Transferor or the Servicer of their respective obligations
under the Trust Sale and Servicing Agreement and each default
on the part of WOFCO or the Transferor of their respective
obligations under the Receivables Purchase Agreement (Section
3.19);
(R) the monitoring of the Issuer's obligations as to
the satisfaction and discharge of the Indenture, the
preparation of an Officers' Certificate, the obtaining of the
Opinion of Counsel and, if necessary, an Independent
Certificate relating thereto (Section 4.1);
(S) the compliance with any written directive of the
Indenture Trustee with respect to the sale of the Trust Estate
in a commercially reasonable manner if an Event of Default
shall have occurred and be continuing (Section 5.4(a));
(T) the preparation of any written instruments
required to confirm more fully the authority of any successor
trustee, co-trustee or separate trustee and any written
instruments necessary in connection with the resignation,
appointment or removal of any co-trustee or separate trustee
(Sections 6.8, 6.9 and 6.10);
(U) the furnishing of the Indenture Trustee with the
names and addresses of Noteholders during any period when the
Indenture Trustee is not the Note Registrar (Section 7.1);
(V) the preparation and, after execution by the
Issuer, the filing with the Commission, if required, any
applicable state agencies and the Indenture Trustee of
documents required to be filed on a periodic basis with, and
summaries thereof as may be required by rules and regulations
prescribed by, the Commission and any applicable state
agencies and the transmission of such summaries, as necessary,
to the Noteholders (Section 7.3);
(W) the notification of the Indenture Trustee of the
listing or delisting of the Notes of any series on any stock
exchange, if and when such Notes are so listed or delisted
(Section 7.4(a));
(X) the opening of one or more accounts in the
Issuer's name, the preparation of Issuer Orders and Officer's
Certificates and all other actions necessary
- 4 -
<PAGE>
with respect to investment and reinvestment of funds in the
Trust Accounts (Sections 8.2 and 8.3);
(Y) the preparation of an Issuer Request and
Officer's Certificate and the obtaining of an Opinion of
Counsel and Independent Certificates, if necessary, for the
release of the Trust Estate (Sections 8.4 and 8.5);
(Z) the preparation of Issuer Orders and the
obtaining of Opinions of Counsel and Officer's Certificates
with respect to the execution of supplemental indentures and
the mailing to the Noteholders of notices with respect to such
supplemental indentures (Sections 9.1, 9.2 and 9.3);
(AA) the preparation and execution of new Notes
conforming to any supplemental indenture (Section 9.6);
(BB) the notification of Noteholders and the Rating
Agencies of the redemption of any Notes subject to redemption
or the duty to cause the Indenture Trustee to provide such
notification (Sections 10.1 and 10.2);
(CC) the preparation of all Officer's Certificates,
Opinions of Counsel and Independent Certificates, if
necessary, with respect to any requests by the Issuer to the
Indenture Trustee to take any action under the Indenture
(Section 11.1(a));
(DD) the preparation and delivery of Officers'
Certificates and the obtaining of Independent Certificates, if
necessary, for the release of property from the lien of the
Indenture (Section 11.1(b));
(EE) the notification of the Rating Agencies, upon
the failure of the Indenture Trustee to give such
notification, of the information required pursuant to Section
11.4 (Section 11.4);
(FF) the preparation and delivery to the Indenture
Trustee of any agreements with respect to alternate payment
and notice provisions (Section 11.6); and
(GG) the recording of the Indenture, if applicable,
and the obtaining of an Opinion of Counsel as required
pursuant to Section 11.15 (Section 11.15).
(ii) The Administrator will perform those payment and
indemnity obligations of the Servicer under Section 6.4 of the Trust
Sale and Servicing Agreement in the event that the Servicer fails to
perform such obligations.
(b) Additional Duties.
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<PAGE>
(i) In addition to the duties of the Administrator set forth
above, the Administrator shall perform such calculations and shall
prepare for execution by the Issuer or the Owner Trustee or shall cause
the preparation by other appropriate Persons of all such documents,
reports, filings, tax returns, instruments, certificates, notices and
opinions as it shall be the duty of the Issuer or the Owner Trustee to
prepare, file or deliver pursuant to the Basic Documents, and at the
request of the Owner Trustee shall take all appropriate action that it
is the duty of the Issuer or the Owner Trustee to take pursuant to the
Basic Documents. Subject to Section 7 of this Agreement, and in
accordance with the directions of the Owner Trustee, the Administrator
shall administer, perform or supervise the performance of such other
activities in connection with the Collateral (including the Basic
Documents) as are not covered by any of the foregoing provisions and as
are expressly requested by the Owner Trustee and are reasonably within
the capability of the Administrator. The Administrator shall send a
copy to the Owner Trustee of all such documents, filings, tax returns,
instruments, certificates, notices or opinions which the Administrator
is required to prepare, file or deliver hereunder on behalf of the
Issuer.
(ii) The Administrator shall perform the duties of the
Administrator specified in Section 6.10 of the Trust Agreement required
to be performed in connection with the resignation or removal of the
Owner Trustee, and any other duties expressly required to be performed
by the Administrator under the Trust Agreement.
(iii) In carrying out the foregoing duties or any of its other
obligations under this Agreement, the Administrator may enter into
transactions with or otherwise deal with any of its Affiliates;
provided, however, that the terms of any such transactions or dealings
shall be in accordance with any directions received from the Issuer and
shall be, in the Administrator's opinion, no less favorable to the
Issuer than would be available from Persons that are not Affiliates of
the Administrator.
(c) Non-Ministerial Matters.
(i) With respect to matters that in the reasonable judgment of
the Administrator are non-ministerial, the Administrator shall not take
any action unless, within a reasonable time before the taking of such
action, the Administrator shall have notified the Owner Trustee of the
proposed action and the Owner Trustee shall not have withheld consent
or provided an alternative direction. For the purpose of the preceding
sentence, "non-ministerial matters" shall include, without limitation:
(A) the amendment of or any supplement to the
Indenture (other than pursuant to or in connection with a
Series Supplement);
(B) 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;
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<PAGE>
(C) the amendment, change or modification of any of
the Basic Documents;
(D) the appointment of successor Note Registrars,
successor Paying Agents and successor Indenture Trustees
pursuant to the Indenture or the appointment of successor
Administrators or successor Servicers, or the consent to the
assignment by the Note Registrar, Paying Agent or Indenture
Trustee of its obligations under the Indenture; and
(E) the removal of the Indenture Trustee.
(ii) Notwithstanding anything to the contrary in this
Agreement, the Administrator shall not be obligated to, and shall not,
(x) make any payments to the Noteholders under the Basic Documents, (y)
except as provided in Section 2(a)(i)(Q) hereof, sell the Trust Estate
pursuant to Section 5.4 of the Indenture or (z) take any other action
that the Issuer directs the Administrator not to take on its behalf.
3. Successor Servicer and Administrator. The Issuer shall
undertake, as promptly as possible after the giving of notice of termination to
the Servicer of the Servicer's rights and powers pursuant to Section 7.1 of the
Trust Sale and Servicing Agreement, to enforce the provisions of Sections 7.1
and 7.2 of the Trust Sale and Servicing Agreement with respect to the
appointment of a successor Servicer. Such successor Servicer shall, upon
compliance with Sections 10(e)(ii) and (iii), become the successor Administrator
hereunder.
4. Records. The Administrator shall maintain appropriate books
of account and records relating to services performed hereunder, which books of
account and records shall be accessible for inspection by the Issuer and the
Transferor at any time during normal business hours.
5. Compensation. As compensation for the performance of the
Administrator's obligations under this Agreement and as reimbursement for its
expenses related thereto, the Servicer shall pay the Administrator a monthly fee
in the amount of $1,500.
6. Additional Information To Be Furnished to the Issuer. The
Administrator shall furnish to the Issuer from time to time such additional
information regarding the Collateral as the Issuer shall reasonably request.
7. Independence of the Administrator. For all purposes of this
Agreement, the Administrator shall be an independent contractor and shall not be
subject to the supervision of the Issuer or the Owner Trustee with respect to
the manner in which it accomplishes the performance of its obligations
hereunder. Unless expressly authorized by the Issuer, the Administrator shall
have no authority to represent the Issuer or the Owner Trustee in any way and
shall not otherwise be deemed an agent of the Issuer or the Owner Trustee.
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<PAGE>
8. No Joint Venture. Nothing contained in this Agreement (a)
shall constitute the Administrator and either of the Issuer or the Owner Trustee
as members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity, (b) shall be construed to
impose any liability as such on any of them or (c) shall be deemed to confer on
any of them any express, implied or apparent authority to incur any obligation
or liability on behalf of the others.
9. Other Activities of Administrator. Nothing herein shall
prevent the Administrator or its Affiliates from engaging in other businesses
or, in its sole discretion, from acting in a similar capacity as an
administrator for any other Person or entity even though such Person or entity
may engage in business activities similar to those of the Issuer, the Owner
Trustee or the Indenture Trustee.
10. Term of Agreement; Resignation and Removal of
Administrator.
(a) This Agreement shall continue in force until the
dissolution of the Issuer, upon which event this Agreement shall automatically
terminate.
(b) Subject to Section 10(e), the Administrator may resign its
duties hereunder by providing the Issuer with at least 60 days' prior written
notice.
(c) Subject to Section 10(e), the Issuer may remove the
Administrator without cause by providing the Administrator with at least 60
days' prior written notice.
(d) Subject to Section 10(e), at the sole option of the
Issuer, the Administrator may be removed immediately upon written notice of
termination from the Issuer to the Administrator if any of the following events
shall occur:
(i) the Administrator shall default in the performance of any
of its duties under this Agreement and, after notice from the Issuer of
such default, shall not cure such default within ten days (or, if such
default cannot be cured in such time, shall not give within ten days
such assurance of cure as shall be reasonably satisfactory to the
Issuer);
(ii) a court having jurisdiction in the premises shall enter a
decree or order for relief, and such decree or order shall not have
been vacated within 60 days, in respect of the Administrator in any
involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect or appoint a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official for the Administrator or any substantial part of its property
or order the winding-up or liquidation of its affairs; or
(iii) the Administrator shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the
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<PAGE>
entry of an order for relief in an involuntary case under any such law,
or shall consent to the appointment of a receiver, liquidator,
assignee, trustee, custodian, sequestrator or similar official for the
Administrator or any substantial part of its property, shall consent to
the taking of possession by any such official of any substantial part
of its property, shall make any general assignment for the benefit of
creditors or shall fail generally to pay its debts as they become due.
The Administrator agrees that if any of the events specified
in clauses (ii) or (iii) of this Section 10(d) shall occur, it shall give
written notice thereof to the Issuer and the Indenture Trustee within seven days
after the happening of such event.
(e) No resignation or removal of the Administrator pursuant to
this Section 10 shall be effective until (i) a successor Administrator shall
have been appointed by the Issuer, (ii) such successor Administrator shall have
agreed in writing to be bound by the terms of this Agreement in the same manner
as the Administrator is bound hereunder, and (iii) the Rating Agency Condition
has been satisfied with respect to such proposed appointment.
11. Action upon Termination, Resignation or Removal. Promptly
upon the effective date of termination of this Agreement pursuant to Section
10(a) or the resignation or removal of the Administrator pursuant to Section
10(b) or (c), respectively, the Administrator shall be entitled to be paid all
fees and reimbursable expenses accruing to it to the effective date of such
termination, resignation or removal. The Administrator shall forthwith upon such
termination pursuant to Section 10(a) deliver to the Issuer all property and
documents of or relating to the Collateral then in the custody of the
Administrator. In the event of the resignation or removal of the Administrator
pursuant to Section 10(b) or (c), respectively, the Administrator shall
cooperate with the Issuer and take all reasonable steps requested to assist the
Issuer in making an orderly transfer of the duties of the Administrator.
12. Notices. All demands, notices and communications upon or
to the Issuer, the Owner Trustee, the Administrator or the Indenture Trustee
shall be delivered as specified in Appendix B of the Trust Sale and Servicing
Agreement.
13. Amendments.
(a) This Agreement may be amended from time to time with prior
notice to the Rating Agencies by a written amendment duly executed and delivered
by the Issuer, the Administrator and the Indenture Trustee, with the consent of
the Owner Trustee, and without the consent of the Noteholders or the
Certificateholders, for any of the following purposes:
(i) to add provisions hereof for the benefit of the
Noteholders and Certificateholders or to surrender any right or power
herein conferred upon the Administrator;
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<PAGE>
(ii) to cure any ambiguity or to correct or supplement any
provision herein which may be inconsistent with any other provision
herein;
(iii) to evidence and provide for the appointment of a
successor Administrator hereunder and to add to or change any of the
provisions of this Agreement as shall be necessary to facilitate such
succession; and
(iv) to add any provisions to or change in any manner or
eliminate any of the provisions of this Agreement or modify in any
manner the rights of the Noteholders or the Certificateholders;
provided, however, that with respect to each such series or class of
Notes or Certificates, such amendment under this Section 13(a)(iv)
either (A) shall not, as evidenced by an Opinion of Counsel, materially
and adversely affect in any material respect the interest of any such
Noteholder or Certificateholder or (B) the Rating Agency Condition
shall have been satisfied with respect thereto.
(b) This Agreement may also be amended by the Issuer, the
Administrator and the Indenture Trustee with prior notice to the Rating Agencies
and with the written consent of the Owners Trustee, the Holders of Notes
evidencing at least a majority of the Outstanding Amount of the Notes as of the
close of the immediately preceding Distribution Date, the Holders of
Certificates evidencing at least a majority of the Voting Interests as of the
close of the preceding Distribution Date for the purpose of adding any
provisions to, changing in any manner or eliminating any of the provisions of
this Agreement or modifying in any manner the rights of Noteholders or the
Certificateholders; provided, however, that no such amendment may (i) increase
or reduce in any manner the amount of, or accelerate or delay the timing of,
Collections on the Receivables held by the Trust or payments or distributions
that are required to be made for the benefit of the Noteholders or the
Certificateholders (it being understood that the issuance of any Securities and
the specification of the terms and provisions thereof pursuant to a Series
Supplement (in the case of Notes) or a supplement to the Trust Agreement (in the
case of Certificates) shall not be deemed to have such effect for purposes
hereof), (ii) reduce the percentage of the Holders of Notes or Certificates
which are required to consent to any amendment of this Agreement or (iii) modify
or alter any provision of this Section 13, except to provide that certain
additional provisions of this Agreement and the Basic Documents cannot be
modified or waived without the consent of each Noteholder and Certificateholder
affected thereby, without, in any such case, the consent of the Holders of all
the outstanding Notes and Certificates.
(c) Notwithstanding Sections 13(a) and (b), the Administrator
may not amend this Agreement without the permission of the Transferor, which
permission shall not be unreasonably withheld.
14. Successors and Assigns. This Agreement may not be assigned
by the Administrator unless such assignment is previously consented to in
writing by the Issuer and the Owner Trustee and subject to the satisfaction of
the Rating Agency Condition for each then outstanding series of Notes in respect
thereof. An assignment with such consent and satisfaction,
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<PAGE>
if accepted by the assignee, shall bind the assignee hereunder in the same
manner as the Administrator is bound hereunder. Notwithstanding the foregoing,
this Agreement may be assigned by the Administrator without the consent of the
Issuer or the Owner Trustee to a corporation or other organization that is a
successor (by merger, consolidation or purchase of assets) to the Administrator,
provided that such successor organization executes and delivers to the Issuer,
the Owner Trustee and the Indenture Trustee an agreement in which such
corporation or other organization agrees to be bound hereunder by the terms of
such assignment in the same manner as the Administrator is bound hereunder.
Subject to the foregoing, this Agreement shall bind any successors or assigns of
the parties hereto.
15. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS OR
ANY OTHER JURISDICTION'S CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
16. Headings. The section headings hereof have been inserted
for convenience of reference only and shall not define or limit any of the terms
or provisions hereof.
17. Separate Counterparts. This Agreement may be executed by
the parties 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.
18. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Notes or the
rights of the Holders thereof.
19. Not Applicable to World Omni Financial Corp. in Other
Capacities. Nothing in this Agreement shall affect any obligation World Omni
Financial Corp. may have in any other capacity.
20. Limitation of Liability of Owner Trustee and Indenture
Trustee.
(a) Notwithstanding anything contained herein to the contrary,
this instrument has been executed by Chase Manhattan Bank Delaware, not in its
individual capacity but solely as Owner Trustee and in no event shall Chase
Manhattan Bank Delaware have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets of the Issuer. For all purposes
of this Agreement, in the performance
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<PAGE>
of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of Article
VI of the Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary,
this Agreement has been executed by Harris Trust and Savings Bank, not in its
individual capacity but solely in its capacity as Indenture Trustee and in no
event shall Harris Trust and Savings Bank have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Issuer.
21. Third-Party Beneficiary. The Owner Trustee is a
third-party beneficiary to this Agreement and is entitled to the rights and
benefits hereunder and may enforce the provisions hereof as if it were a party
hereto.
* * * * *
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<PAGE>
IN WITNESS WHEREOF, the parties have caused this
Administration Agreement to be duly executed by their respective officers as of
the day and year first above written.
WORLD OMNI MASTER OWNER TRUST
By: Chase Manhattan Bank Delaware,
not in its individual capacity,
but solely as Owner Trustee
By: __________________________________________
Name:
Title:
HARRIS TRUST AND SAVINGS BANK,
as Indenture Trustee
By: Harris Trust and Savings Bank,
not in its individual capacity,
but solely as Indenture Trustee
By: __________________________________________
Name: E. Kay Liederman Van Dam
Title: Vice President
WORLD OMNI FINANCIAL CORP.,
as Administrator
By: __________________________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
- 13 -
TRUST AGREEMENT
BETWEEN
WODFI LLC
TRANSFEROR
AND
CHASE MANHATTAN BANK DELAWARE
OWNER TRUSTEE
DATED AS OF NOVEMBER 22, 1999
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE...............................................................1
SECTION 1.1 Definitions...................................................................1
ARTICLE II
ORGANIZATION.............................................................................................1
SECTION 2.1 Name..........................................................................1
SECTION 2.2 Office........................................................................1
SECTION 2.3 Purposes and Powers...........................................................1
SECTION 2.4 Appointment of Owner Trustee..................................................2
SECTION 2.5 Initial Capital Contribution of Owner Trust Estate............................2
SECTION 2.6 Declaration of Trust..........................................................2
SECTION 2.7 Liability of the Certificate Owners...........................................3
SECTION 2.8 Title to Trust Property.......................................................3
SECTION 2.9 Situs of Trust................................................................3
SECTION 2.10 Representations and Warranties of the Transferor..............................3
SECTION 2.11 Tax Treatment.................................................................4
ARTICLE III
THE CERTIFICATES.........................................................................................5
SECTION 3.1 Initial Certificate Ownership.................................................5
SECTION 3.2 Form of Certificates..........................................................5
SECTION 3.3 Execution, Authentication and Delivery........................................5
SECTION 3.4 New Issuances.................................................................6
SECTION 3.5 Registration; Registration of Transfer and Exchange of
Certificates..................................................................6
SECTION 3.6 Mutilated, Destroyed, Lost or Stolen Certificates.............................7
SECTION 3.7 Persons Deemed Certificateholders.............................................8
SECTION 3.8 Access to List of Certificateholders' Names and Addresses. ..................8
SECTION 3.9 Maintenance of Corporate Trust Office.........................................9
SECTION 3.10 Appointment of Paying Agent...................................................9
SECTION 3.11 Transferor as Certificateholder...............................................9
ARTICLE IV
ACTIONS BY OWNER TRUSTEE................................................................................10
SECTION 4.1 Prior Notice to Certificateholders with Respect to Certain
Matters......................................................................10
SECTION 4.2 Action by Certificateholders with Respect to Certain Matters.................10
SECTION 4.3 Action by Certificateholders with Respect to Bankruptcy......................11
SECTION 4.4 Restrictions on Certificateholders' Power. .................................11
SECTION 4.5 Majority Control.............................................................11
i
<PAGE>
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES..............................................................11
SECTION 5.1 Establishment of Certificate Distribution Account............................11
SECTION 5.2 Application of Trust Funds...................................................12
SECTION 5.3 Method of Payment............................................................13
SECTION 5.4 Accounting and Reports to the Certificateholders, the Internal
Revenue Service and Others...................................................13
SECTION 5.5 Signature on Returns; Tax Matters Partner....................................13
ARTICLE VI
THE OWNER TRUSTEE.......................................................................................14
SECTION 6.1 Duties of Owner Trustee......................................................14
SECTION 6.2 Rights of Owner Trustee. ...................................................15
SECTION 6.3 Acceptance of Trusts and Duties..............................................15
SECTION 6.4 Action upon Instruction by Certificateholders................................16
SECTION 6.5 Furnishing of Documents......................................................17
SECTION 6.6 Representations and Warranties of Owner Trustee..............................17
SECTION 6.7 Reliance; Advice of Counsel..................................................18
SECTION 6.8 Owner Trustee May Own Certificates and Notes.................................19
SECTION 6.9 Compensation and Indemnity...................................................19
SECTION 6.10 Replacement of Owner Trustee.................................................19
SECTION 6.11 Merger or Consolidation of Owner Trustee.....................................20
SECTION 6.12 Appointment of Co-Trustee or Separate Trustee................................21
SECTION 6.13 Eligibility Requirements for Owner Trustee...................................22
ARTICLE VII
TERMINATION OF TRUST AGREEMENT..........................................................................22
SECTION 7.1 Termination of Trust Agreement...............................................22
ARTICLE VIII
AMENDMENTS..............................................................................................24
SECTION 8.1 Amendments Without Consent of Securityholders................................24
SECTION 8.2 Amendments With Consent of Securityholders...................................24
SECTION 8.3 Form of Amendments...........................................................25
ARTICLE IX
MISCELLANEOUS...........................................................................................25
SECTION 9.1 No Legal Title to Owner Trust Estate. ......................................25
SECTION 9.2 Limitations on Rights of Others..............................................25
SECTION 9.3 Notices......................................................................26
SECTION 9.4 Severability of Provisions...................................................26
SECTION 9.5 Counterparts.................................................................26
SECTION 9.6 Successors and Assigns.......................................................26
SECTION 9.7 No Petition Covenant.........................................................26
SECTION 9.8 No Recourse..................................................................26
SECTION 9.9 Headings.....................................................................27
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SECTION 9.10 Governing Law................................................................27
SECTION 9.11 Certificate Transfer Restrictions............................................27
SECTION 9.12 Indemnification by and Reimbursement of the Servicer.........................27
SECTION 9.13 Third-Party Beneficiaries....................................................27
EXHIBITS
Exhibit A Form of Certificate
Exhibit B Form of Certificate of Trust
Exhibit C Form of Investor Letter
</TABLE>
iii
<PAGE>
THIS TRUST AGREEMENT, dated as of November 22, 1999, between
WODFI LLC, a Delaware limited liability company, as Transferor (the
"Transferor"), and Chase Manhattan Bank Delaware, a Delaware banking
corporation, as Owner Trustee (not in its individual capacity but solely as
Owner Trustee, the "Owner Trustee").
In consideration of the premises and the mutual covenants
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions. Certain capitalized terms used in
this Agreement shall have the respective meanings assigned to them in Part I of
Appendix A to the Trust Sale and Servicing Agreement dated as of November 22,
1999, among the Transferor, the Servicer and the Trust (the "Trust Sale and
Servicing Agreement"). All references herein to "the Agreement" or "this
Agreement" are to the Trust Agreement as it may be amended and supplemented from
time to time, and all references herein to Articles, Sections and subsections
are to Articles, Sections and subsections of this Agreement unless otherwise
specified. The rules of construction set forth in Part II of Appendix A to the
Trust Sale and Servicing Agreement shall be applicable to this Agreement.
ARTICLE II
ORGANIZATION
SECTION 2.1 Name. The Trust created hereby shall be known as
World Omni Master Owner Trust in which name the Owner Trustee may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and sue and be sued on behalf of the Trust.
SECTION 2.2 Office. The office of the Trust shall be in care
of the Owner Trustee at the Corporate Trust Office or at such other address in
Delaware as the Owner Trustee may designate by written notice to the
Certificateholders and the Transferor.
SECTION 2.3 Purposes and Powers. The purpose of the Trust is,
and the Trust shall have the power and authority, to engage in the following
activities:
(a) to acquire, manage and hold the Receivables to be
transferred to the Trust from time to time pursuant to the Trust Sale and
Servicing Agreement;
(b) to issue and sell the Notes pursuant to the Indenture or
to another indenture, note purchase agreement or similar agreement and the
Certificates pursuant to this Agreement, and to sell, transfer or exchange the
Notes and the Certificates;
(c) to acquire property and assets from the Transferor
pursuant to the Trust Sale and Servicing Agreement, to make payments or
distributions on the Securities to the Securityholders,
<PAGE>
to make withdrawals from the accounts established pursuant to the Basic
Documents and to pay the organizational, start-up and transactional expenses of
the Trust;
(d) to establish, acquire, hold and terminate liquidity,
credit and other enhancement arrangements, and perform its obligations
thereunder;
(e) to assign, grant, transfer, pledge, mortgage and convey
the Trust Estate pursuant to the terms of the Indenture and to hold, manage such
Trust Estate and distribute funds to the Certificateholders pursuant to the
terms of this Agreement and the Trust Sale and Servicing Agreement any portion
of the Trust Estate released from the lien of, and remitted to the Trust
pursuant to, the Indenture;
(f) to enter into and perform its obligations and exercise its
rights under the Basic Documents to which it is to be a party;
(g) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish the
foregoing or are incidental thereto or connected therewith; and
(h) 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 Securityholders.
The Trust shall not engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of this Agreement
or the Basic Documents.
SECTION 2.4 Appointment of Owner Trustee. The Transferor
hereby appoints the Owner Trustee as trustee of the Trust effective as of the
date hereof, to have all the rights, powers and duties set forth herein.
SECTION 2.5 Initial Capital Contribution of Owner Trust
Estate. Pursuant to the Trust Sale and Servicing Agreement, on the date hereof,
the Transferor will sell, assign, transfer, convey and set over to the Owner
Trustee, the assets specified in the Trust Sale and Servicing Agreement. 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. The Transferor shall pay organizational expenses of
the Trust as they may arise or shall, upon the request of the Owner Trustee,
promptly reimburse the Owner Trustee for any such expenses paid by the Owner
Trustee.
SECTION 2.6 Declaration of Trust. The Owner Trustee hereby
declares that it shall hold the Owner Trust Estate in trust upon and subject to
the conditions and obligations set forth herein and in the Trust Sale and
Servicing Agreement for the use and benefit of the Certificateholders, subject
to the obligations of the Trust under the Basic Documents. It is the intention
of the parties hereto that the Trust constitute a business trust under the
Business Trust Statute, that this Agreement constitute the governing instrument
of such business trust and that the Certificates represent the
2
<PAGE>
equity interests therein. The rights of the Certificateholders shall be
determined as set forth herein and in the Business Trust Statute and the
relationship between the parties created by this Agreement shall not constitute
indebtedness. The parties hereto agree that, unless otherwise required by
appropriate taxing authorities, the Trust shall file or cause to be filed annual
or other necessary returns, reports and other forms consistent with the
characterization of the Trust as a partnership for such tax purposes. Effective
as of the date hereof, the Owner Trustee shall have all rights, powers and
duties set forth in this Agreement, the Trust Sale and Servicing Agreement and
the Business Trust Statute with respect to accomplishing the purposes of the
Trust. The Owner Trustee agrees to file the certificate of trust required under
ss. 3810 et seq. of the Business Trust Statute in the form of Exhibit B hereto
(the "Certificate of Trust") in connection with the formation of the Trust as a
business trust under the Business Trust Statute.
SECTION 2.7 Liability of the Certificate Owners.
Certificateholders and holders of beneficial interests therein shall be entitled
to the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the Delaware General Corporation Law.
SECTION 2.8 Title to Trust Property. Legal title to all the
Owner Trust Estate shall be vested at all times in the Trust as a separate legal
entity except where applicable law in any jurisdiction requires title to any
part of the Owner Trust Estate to be vested in a trustee or trustees, in which
case title shall be deemed to be vested in the Owner Trustee, a co-trustee
and/or a separate trustee, as the case may be.
SECTION 2.9 Situs of Trust. The Trust shall be located and
administered in the State of Delaware. All bank accounts maintained by the Owner
Trustee on behalf of the Trust shall be located in the State of Delaware. The
Trust 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 Trust only in Delaware, and payments and distributions shall be
made by the Trust only from Delaware. The only office of the Trust shall be the
Corporate Trust Office in Delaware.
SECTION 2.10 Representations and Warranties of the Transferor.
The Transferor hereby represents and warrants to the Owner Trustee and the
Indenture Trustee that:
(a) The Transferor has been duly organized and is validly
existing as a limited liability company in good standing under the laws of the
State of Delaware, with power and authority to own its properties and to conduct
its business as such properties are presently owned and such business is
presently conducted, and had at all relevant times, and now has, power,
authority and legal right to acquire and own the Receivables and all Collateral
Security contemplated to be transferred to the Trust pursuant to the Trust Sale
and Servicing Agreement.
(b) The Transferor is duly qualified to do business and, where
necessary is in good standing (or is exempt from such requirement), 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 requires such
qualifications, except where the failure to so qualify or obtain licenses or
approvals would not
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have a material adverse effect on its ability to perform its obligations under
the Basic Documents to which it is a party.
(c) The Transferor has the power and authority to execute and
deliver this Agreement, to carry out its terms and to consummate the
transactions contemplated herein; and the execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein have
been duly authorized by the Transferor by all necessary limited liability
company action.
(d) The execution of this Agreement and the consummation of
the transactions contemplated herein by the Transferor and the fulfillment of
the terms of this Agreement by the Transferor shall not conflict with, result in
any breach of any of the terms and provisions of or constitute (with or without
notice or lapse of time) a default under, the limited liability company
agreement of the Transferor, or any indenture, agreement, mortgage, deed of
trust or other instrument to which the Transferor is a party or by which it is
bound, or result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement, mortgage,
deed of trust or other instrument (other than pursuant to the Basic Documents),
or violate any law or, to the best of the Transferor's knowledge, any order,
rule or regulation applicable to the Transferor of any Governmental Authority
having jurisdiction over the Transferor or any of its properties.
SECTION 2.11 Tax Treatment. As long as the Transferor is the
sole owner of the Certificates, the Transferor and Owner Trustee, by entering
into this Agreement, (i) express their intention that the Trust will be
disregarded for federal income tax purposes and will be treated as a division or
branch of the Transferor and (ii) agree that Section 5.5 of this Agreement will
not be applicable, and for so long as the Transferor remains the sole record
Certificateholder, the Owner Trustee shall not sign tax returns. If the
Transferor is not the sole owner of the Certificates, through sale of
Certificates, issuance by the Trust of additional Certificates to a person other
than the Transferor, or otherwise, the Transferor and Owner Trustee, by entering
into this Agreement, and the Certificateholders, by acquiring any Certificate or
interest in the Trust, (i) express their intention that the Certificates shall
qualify under applicable tax law as partnership interests in a partnership, with
the assets of the partnership held by the Trust, (ii) unless otherwise required
by appropriate taxing authorities, agree to treat the Certificates as
partnership interests for purposes of federal, state and local income and
franchise taxes, single business tax and any other taxes imposed upon, measured
by or based upon gross or net income, and (iii) agree that immediately upon
there being more than one owner of Certificates, Section 5.5 of this Agreement
will become applicable. Notwithstanding anything herein to the contrary, the
Owner Trustee shall have no duty to take any action pursuant to Section 5.5 or
file tax returns until it has actual knowledge that the Transferor is not the
sole Certificateholder.
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ARTICLE III
THE CERTIFICATES
SECTION 3.1 Initial Certificate Ownership. Upon the formation
of the Trust by the contribution by the Transferor pursuant to Section 2.5 and
until the issuance of the Certificates, the Transferor shall be the sole
beneficiary of the Trust.
SECTION 3.2 Form of Certificates.
(a) The Certificates shall be substantially in the form set
forth in Exhibit A. The Certificates shall be executed on behalf of the Trust by
manual or facsimile signature of a Responsible Officer of the Owner Trustee.
Certificates 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 Trust, shall be, when authorized pursuant to Section 3.3, validly
issued and entitled to the benefits of the Agreement, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
authentication and delivery of such certificates or did not hold such offices at
the date of authentication and delivery of such certificates.
(b) The Certificates shall be typewritten, printed,
lithographed or engraved or produced by any combination of these methods (with
or without steel engraved borders) all as determined by the officers executing
such Certificates, as evidenced by their execution of such Certificates.
(c) The Certificates shall be issued in fully-registered form
and shall be in definitive form only. The terms of the Certificates set forth in
Exhibit A shall form part of this Agreement.
SECTION 3.3 Execution, Authentication and Delivery.
Concurrently with the sale of the Receivables to the Trust pursuant to the Trust
Sale and Servicing Agreement, the Owner Trustee shall cause the Certificates to
be executed on behalf of the Trust, authenticated and delivered to or upon the
written order of the Transferor, signed by the chairman of the board, the
president, any vice president, the treasurer or any assistant treasurer of the
Transferor without further action by the Transferor, in authorized
denominations. No Certificate shall entitle its holder to any benefit under this
Agreement, or shall be valid for any purpose, unless there shall appear on such
Certificate a certificate of authentication substantially in the form set forth
in Exhibit A, executed by the Owner Trustee or the Owner Trustee's
authenticating agent, if any, by manual signature. Such authentication shall
constitute conclusive evidence that such Certificate shall have been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. The Owner Trustee may appoint an agent to act as its
authenticating agent for the purpose of authenticating the Certificates (an
"Authenticating Agent") (who shall be a bank or trust company). Each holder of a
Certificate shall provide the Owner Trustee or the Certificate Registrar with a
form W-9.
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SECTION 3.4 New Issuances.
(a) The Transferor may surrender a portion of its Certificate
to the Owner Trustee in exchange for a newly issued Certificate and one or more
additional certificates (each a "Supplemental Certificate"), the terms of which
shall be defined in a supplement to this Agreement (which supplement shall be
subject to Article VIII to the extent that it amends any of the terms of this
Agreement), to be delivered to or upon the order of the Transferor (or the
holder of a Supplemental Certificate, in the case of the transfer or exchange
thereof, as provided below), upon satisfaction of the following conditions:
(i) the Transferor shall have given the Rating
Agencies notice 5 days prior to such exchange (or transfer and exchange
as provided below) and the Rating Agency Condition shall have been
satisfied with respect to such exchange (or transfer and exchange as
provided below); and
(ii) the Transferor shall have delivered to the Owner
Trustee, the Indenture Trustee, the Rating Agencies and any Enhancement
Provider a Tax Opinion dated the date of such exchange (or transfer and
exchange as provided below), with respect thereto.
Any Supplemental Certificate may be transferred or exchanged only upon
satisfaction of the conditions set forth in clauses (i) and (ii) above.
SECTION 3.5 Registration; Registration of Transfer and
Exchange of Certificates.
(a) The Certificate Registrar shall keep or cause to be kept,
at the office or agency maintained pursuant to Section 3.9, a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Owner Trustee shall provide for the registration of Certificates and of
transfers and exchanges of Certificates as provided herein. The Certificate
Registrar shall give the Indenture Trustee written notice of any transfer of any
Certificate. The Owner Trustee shall be the initial Certificate Registrar. The
Owner Trustee may appoint a successor to act as the Certificate Registrar (who
shall be a bank or trust company).
(b) Unless otherwise specified in a supplement to this
Agreement, a Certificateholder may at any time, without consent of the
Noteholders, sell, transfer, convey or assign in any manner its rights to and
interests in the Certificates, provided that certain conditions are satisfied
including: (i) such action will not result in a reduction or withdrawal of the
rating of any series or class of Notes; (ii) the Certificateholder provides to
the Owner Trustee and the Indenture Trustee an opinion of independent counsel
that such action will not cause the Trust to be treated as an association (or
publicly traded partnership) taxable as a corporation for federal income tax
purposes; (iii) such transferee or assignee agrees in writing to take positions
for tax purposes consistent with the tax positions agreed to be taken by the
initial Certificateholder; and (iv) the conditions set forth in Section 9.11
have been satisfied. In addition, no transfer of a Certificate shall be
registered unless the transferee shall have provided to the Owner Trustee and
the Certificate Registrar an opinion of counsel that in connection with such
transfer no registration of the Certificates
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is required under the Securities Act or applicable state law or that such
transfer is otherwise being made in accordance with all applicable federal and
state securities laws.
(c) Subject to Section 3.5(b), upon surrender for registration
of transfer of any Certificate at the office or agency maintained pursuant to
Section 3.9, the Owner Trustee shall execute on behalf of the Trust,
authenticate and deliver (or shall cause the Authenticating Agent, if any, to
authenticate and deliver), in the name of the designated transferee or
transferees, one or more new Certificates of the same class in authorized
denominations of a like aggregate amount dated the date of authentication by the
Owner Trustee or any authenticating agent.
(d) At the option of a Certificateholder, Certificates may be
exchanged for other Certificates of a like aggregate percentage interest upon
surrender of the Certificates to be exchanged at the Corporate Trust Office
maintained pursuant to Section 3.9. Whenever any Certificates are so surrendered
for exchange, the Owner Trustee shall execute on behalf of the Trust,
authenticate and deliver (or shall cause the Authenticating Agent, if any, to
authenticate and deliver) one or more Certificates dated the date of
authentication by the Owner Trustee or any authenticating agent. Such
Certificates shall be delivered to the Certificateholder making the exchange.
(e) Every Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Owner Trustee and the
Certificate Registrar duly executed by the Certificateholder or his attorney
duly authorized in writing and such other documents and instruments as may be
required by Section 3.5(b). Each Certificate surrendered for registration of
transfer or exchange shall be canceled and subsequently destroyed or otherwise
disposed of by the Owner Trustee or Certificate Registrar in accordance with its
customary practice.
(f) No service charge shall be made for any registration of
transfer or exchange of Certificates, but the Owner Trustee or the Certificate
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
SECTION 3.6 Mutilated, Destroyed, Lost or Stolen Certificates.
(a) If (i) any mutilated Certificate is surrendered to the
Certificate Registrar, or the Certificate Registrar receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate and (ii) there
is delivered to the Certificate Registrar, the Owner Trustee and the Trust such
security or indemnity as may be required by them to hold each of them harmless,
then, in the absence of notice to the Certificate Registrar or the Owner Trustee
that such Certificate has been acquired by a bona fide purchaser, the Owner
Trustee shall execute on behalf of the Trust and the Owner Trustee shall
authenticate and deliver (or shall cause the Authenticating Agent, if any, to
authenticate and deliver), in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, one or more replacement Certificates in
authorized denominations of a like amount; provided, however, that if any such
destroyed, lost or stolen Certificate, but not a mutilated Certificate, shall
have become or within seven days shall be due and payable, then instead of
issuing
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a replacement Certificate the Owner Trustee may pay distributions to the
Certificateholder of such destroyed, lost or stolen Certificate when so due or
payable.
(b) If, after the delivery of a replacement Certificate or
distribution in respect of a destroyed, lost or stolen Certificate pursuant to
Section 3.6(a), a bona fide purchaser of the original Certificate in lieu of
which such replacement Certificate was issued presents for payment such original
Certificate, the Owner Trustee shall be entitled to recover such replacement
Certificate from the Person to whom it was delivered or any Person taking such
replacement Certificate (or such distribution) from such Person to whom such
replacement Certificate was delivered or any assignee of such Person, except a
bona fide purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Owner Trustee in connection therewith.
(c) In connection with the issuance of any replacement
Certificate under this Section 3.6, the Owner Trustee may require the payment by
the Holder of such Certificate 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 Owner Trustee and
the Certificate Registrar) connected therewith.
(d) Any duplicate Certificate issued pursuant to this Section
3.6 in replacement of any mutilated, destroyed, lost or stolen Certificate shall
constitute an original additional contractual obligation of the Trust, whether
or not the mutilated, destroyed, lost or stolen Certificate shall be found at
any time or be enforced by anyone, and shall be entitled to all the benefits of
this Agreement equally and proportionately with any and all other Certificates
duly issued hereunder.
(e) The provisions of this Section 3.6 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 Certificates.
SECTION 3.7 Persons Deemed Certificateholders. Prior to due
presentation of a Certificate for registration of transfer, the Owner Trustee or
the Certificate Registrar may treat the Person in whose name any Certificate
shall be registered in the Certificate Register as the Certificateholder of such
Certificate for the purpose of receiving distributions pursuant to Article V and
for all other purposes whatsoever, and neither the Owner Trustee nor the
Certificate Registrar shall be bound by any notice to the contrary.
SECTION 3.8 Access to List of Certificateholders' Names and
Addresses. The Owner Trustee shall furnish or cause to be furnished to the
Servicer and the Transferor, within 15 days after receipt by the Owner Trustee
of a request therefor from the Servicer or the Transferor in writing, a list, in
such form as the Servicer or the Transferor may reasonably require, of the names
and addresses of the Certificateholders as of the most recent Record Date. Each
Holder, by receiving and holding a Certificate, shall be deemed to have agreed
not to hold any of the Servicer, the Transferor or the Owner Trustee accountable
by reason of the disclosure of its name and address, regardless of the source
from which such information was derived.
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SECTION 3.9 Maintenance of Corporate Trust Office. The Owner
Trustee shall maintain in the City of Wilmington, the State of Delaware an
office or offices or agency or agencies where 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 Certificates and the Basic Documents
may be served. The Owner Trustee initially designates the offices of the Owner
Trustee, as its principal office for such purposes. The Owner Trustee shall give
prompt written notice to the Transferor and to the Certificateholders of any
change in the location of the Certificate Register or any such office or agency.
SECTION 3.10 Appointment of Paying Agent. The Owner Trustee
may appoint a Paying Agent. If so appointed, such Paying Agent shall make
distributions to Certificateholders from the Certificate Distribution Account
pursuant to Section 5.2 and shall report the amounts of such distributions to
the Owner Trustee and the Servicer; provided that no such reports shall be
required so long as the Transferor is the sole Certificateholder. For so long as
the Indenture is in effect, notwithstanding anything in this Agreement to the
contrary, all amounts to be distributed to the Certificateholders or the
Certificate Distribution Account shall be distributed by the Indenture Trustee
as required by the Series Supplement. 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 Owner Trustee may
revoke such power and remove any Paying Agent appointed by it. Any Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' written notice to the
Owner Trustee, whereupon the Owner Trustee may appoint a successor to act as the
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 distribution
to the Certificateholders in trust for the benefit of the Certificateholders
entitled thereto until such sums shall be paid to such 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 6.3, 6.6, 6.7 and
6.9 shall apply to the Owner Trustee also in its role as Paying Agent, for so
long as the Owner Trustee shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in this
Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
SECTION 3.11 Transferor as Certificateholder. The Transferor
in its individual or any other capacity may become the owner or pledgee of
Certificates and may otherwise deal with the Owner Trustee or its Affiliates as
if it were not the Transferor.
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ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1 Prior Notice to Certificateholders with Respect to
Certain Matters. The Owner Trustee shall not take action with respect to the
following matters, unless (i) the Owner Trustee shall have notified the
Certificateholders in writing of the proposed action at least 30 days before the
taking of such action, and (ii) a majority of the Certificateholders shall not
have notified the Owner Trustee in writing prior to the 30th day after such
notice is given that such Certificateholders have withheld consent or provided
alternative direction:
(a) the initiation of any claim or lawsuit by the Trust (other
than an action to collect on a Receivable or an action by the Indenture Trustee
pursuant to the Indenture) and the compromise of any action, claim or lawsuit
brought by or against the Trust (other than an action to collect on a Receivable
or an action by the Indenture Trustee pursuant to the Indenture);
(b) the election by the Trust to file an amendment to the
Certificate of Trust;
(c) the amendment of the Indenture by a supplemental indenture
in circumstances where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture
in circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interest of the Certificateholders
(it being understood that the issuance of additional Certificates as
contemplated by Section 3.4 shall be deemed to not materially adversely affect
the interests of the Certificateholders);
(e) the amendment, change or modification of the
Administration Agreement, except to cure any ambiguity or to amend or supplement
any provision in a manner that would not materially adversely affect the
interests of the Certificateholders; or
(f) the appointment pursuant to the Indenture of a successor
Note Registrar, Paying Agent or Indenture Trustee or pursuant to this Agreement
of a successor Certificate Registrar, or the consent to the assignment by the
Note Registrar, Paying Agent or Indenture Trustee or Certificate Registrar of
its obligations under the Indenture or this Agreement, as applicable.
SECTION 4.2 Action by Certificateholders with Respect to
Certain Matters. The Owner Trustee shall not have the power, except upon the
written direction of the Certificateholders, as described in the last sentence
of this Section 4.2, to (a) remove the Administrator under the Administration
Agreement pursuant to Section 10 thereof, (b) appoint a successor Administrator
pursuant to Section 10 of the Administration Agreement, (c) remove the Servicer
under the Trust Sale and Servicing Agreement pursuant to Section 7.2 thereof or
(d) except as expressly provided in the Basic Documents, sell the Receivables
transferred to the Trust pursuant to the Trust Sale and Servicing Agreement or
any interest therein after the termination of the Indenture. The Owner Trustee
shall take the actions referred to in the preceding sentence only upon the
affirmative vote of,
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or a written consent signed by, the holders of a majority of the Voting
Interests upon at least 30 days prior notice thereof.
SECTION 4.3 Action by Certificateholders with Respect to
Bankruptcy. The Owner Trustee shall not have the power to commence a voluntary
proceeding in bankruptcy relating to the Trust without the unanimous prior
approval of all Holders of Certificates (including the Transferor) and the
delivery to the Owner Trustee by each such Certificateholder of a certificate
certifying that such Certificateholder reasonably believes that the Trust is
insolvent. By its acceptance of any Certificate issued to it on the Closing
Date, the Transferor agrees that it, at any time that it is the holder thereof,
shall not approve or be deemed to have approved the commencement of a voluntary
proceeding in bankruptcy relating to the Trust for purposes of this Section 4.3
unless such commencement is approved by the affirmative vote of all of the
members of the Transferor's board of directors.
SECTION 4.4 Restrictions on Certificateholders' Power. The
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 Trust or the Owner Trustee under this Agreement or any of the Basic
Documents or would be contrary to Section 2.3, nor shall the Owner Trustee be
obligated to follow any such direction, if given.
SECTION 4.5 Majority Control. Except as expressly provided
herein, any action that may be taken or consent that may be given or withheld by
the Certificateholders under this Agreement shall be effective if such action is
taken or such consent is given or withheld by the Holders of Certificates
evidencing not less than a majority of the Voting Interests thereof. Except as
expressly provided herein, any written notice of the Certificateholders
delivered pursuant to this Agreement shall be effective if signed by Holders of
Certificates evidencing not less than a majority of the Voting Interests at the
time of the delivery of such notice.
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1 Establishment of Certificate Distribution Account.
(a) The Servicer, for the benefit of the Certificateholders,
shall cause to be established and maintained in the name of the Owner Trustee an
Eligible Deposit Account known as the World Omni Master Owner Trust Certificate
Distribution Account (the "Certificate Distribution Account"), bearing an
additional designation clearly indicating that the funds deposited therein are
held for the benefit of the Certificateholders. The Certificate Distribution
Account shall initially be established with the Owner Trustee.
(b) The Owner Trustee shall possess all right, title and
interest in and to all funds on deposit from time to time in the Certificate
Distribution Account and in all proceeds thereof for the benefit of the
Certificateholders. Except as otherwise provided herein or in the Trust Sale and
Servicing Agreement, the Certificate Distribution Account shall be under the
sole dominion and
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control of the Owner Trustee for the benefit of the Certificateholders. If, at
any time, any Certificate Distribution Account ceases to be an Eligible Deposit
Account, the Servicer, within 10 days of determining that such Certificate
Distribution Account is no longer an Eligible Deposit Account, shall establish a
substitute Eligible Deposit Account as such Certificate Distribution Account,
instruct the Owner Trustee in writing to transfer any cash and/or any Eligible
Investments to such new Certificate Distribution Account and, from the date any
such substitute account is established, such account shall be the Certificate
Distribution Account.
All Eligible Investments shall be held by the Owner
Trustee as applicable, for the benefit of the Certificateholders. Funds on
deposit in the Certificate Distribution Account shall at the written direction
of the Servicer be invested by the Owner Trustee, solely in Eligible Investments
that will mature so that such funds will be available at the close of business
on the next Business Day. All interest and other investment earnings (net of
losses and investment expenses) on funds on deposit in the Certificate
Distribution Account shall be credited to the Certificate Distribution Account
when received. In the absence of timely and specific written investment
direction from the Servicer, the Owner Trustee shall invest any cash held by it
in Eligible Investments specified in clause (h) of the definition thereof. In no
event shall the Owner Trustee be liable for the selection of investments or for
investment losses incurred thereon. The Owner Trustee shall have no liability in
respect of losses incurred as a result of the liquidation of any investment
prior to its stated maturity or the failure of the Servicer to provide timely
written investment direction.
SECTION 5.2 Application of Trust Funds.
(a) On each Payment Date, the Owner Trustee shall distribute
to the Certificateholders the amounts deposited in the Certificate Distribution
Account as set forth in the applicable Series Supplement. Notwithstanding the
foregoing or anything else to the contrary in this Agreement or the other Basic
Documents, so long as Certificates representing in the aggregate a 100%
beneficial interest in the Trust are held by the Transferor, (i) no Certificate
Distribution Account shall be required to be established or maintained and (ii)
all distributions and payments on the Certificates (including the final
distribution as contemplated by Section 7.1(c) hereof) required hereunder or
under the Indenture or the applicable Series Supplement shall be made directly
to the Transferor by the Owner Trustee (whether or not the Indenture or the
applicable Series Supplement otherwise contemplates deposit into the Certificate
Distribution Account) and the Indenture Trustee and the Owner Trustee shall have
no duty or liability to see to such distribution.
(b) On each Payment Date, the Owner Trustee shall send to each
Certificateholder the statement provided to the Owner Trustee by the Servicer
pursuant to Section 3.4 of the Trust Sale and Servicing Agreement on such
Payment Date.
(c) If the Owner Trustee determines, whether as a result of
advice from the Administrator or otherwise, that any withholding tax is imposed
on the Trust's distribution (or allocations of income) to a Certificateholder,
such tax shall reduce the amount otherwise distributable to the
Certificateholder in accordance with this Section 5.2; provided that the Owner
Trustee shall not have an obligation to withhold any such amount so long as the
Transferor is the sole
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Certificateholder. The Owner Trustee is hereby authorized and directed to retain
from amounts otherwise distributable to the Certificateholders sufficient funds
for the payment of any tax that is legally owed by the Trust (but such
authorization shall not prevent the Owner Trustee (without any obligation to do
so) 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
Certificateholder shall be treated as cash distributed to such Certificateholder
at the time it is withheld by the Trust and remitted to the appropriate taxing
authority. If there is a possibility that withholding tax is payable with
respect to a distribution (such as a distribution to a non-U.S.
Certificateholder), the Owner Trustee may in its sole discretion (but shall not
be required to) withhold such amounts in accordance with this Section 5.2(c). If
a Certificateholder wishes to apply for a refund of any such withholding tax,
the Owner Trustee shall reasonably cooperate with such Certificateholder in
making such claim so long as such Certificateholder agrees to reimburse the
Owner Trustee for any out-of-pocket expenses incurred.
SECTION 5.3 Method of Payment. Subject to Section 7.1(c),
distributions required to be made to Certificateholders on any Payment Date
shall be made to each Certificateholder of record on the related Record Date
either by wire transfer, in immediately available funds, to the account of such
Holder at a bank or other entity having appropriate facilities therefor, if such
Certificateholder shall have provided to the Certificate Registrar appropriate
written instructions at least five Business Days prior to such Record Date, or,
if not, by check mailed to such Certificateholder at the address of such Holder
appearing in the Certificate Register.
SECTION 5.4 Accounting and Reports to the Certificateholders,
the Internal Revenue Service and Others. The Owner Trustee shall (a) maintain
(or cause to be maintained) the books of the Trust on a calendar year basis on
the cash method of accounting, (b) deliver to each Certificateholder, as may be
required by the Code and applicable Treasury Regulations or otherwise, such
information as may be required to enable each Certificateholder to prepare its
federal income tax return, (c) file such tax returns relating to the Trust and
make such elections as may from time to time be required or appropriate under
any applicable state or federal statute or rule or regulation thereunder so as
to maintain the Trust's characterization as, for so long as all of the
Certificates are owned by the Transferor, a division or branch of the Transferor
and, if not, as determined by the Transferor for federal income tax purposes, in
all such cases on forms prepared by the Administrator, (d) cause such tax
returns to be signed in the manner required by law and (e) collect or cause to
be collected any withholding tax required to be withheld by the Owner Trustee in
accordance with Section 5.2(c) with respect to income or distributions to
Certificateholders.
SECTION 5.5 Signature on Returns; Tax Matters Partner. Subject
to Section 2.11, the Owner Trustee shall sign on behalf of the Trust any and all
tax returns of the Trust that are prepared and delivered to it for execution by
the Administrator, unless applicable law requires a Certificateholder to sign
such documents, in which case such documents shall be signed by the Transferor.
The Transferor shall be the "tax matters partner" of the Trust pursuant to the
Code.
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ARTICLE VI
THE OWNER TRUSTEE
SECTION 6.1 Duties of Owner Trustee.
(a) The Owner Trustee undertakes to perform such duties, and
only such duties, as are specifically set forth in this Agreement and the other
Basic Documents, including the administration of the Trust in the interest of
the Certificateholders, subject to the Basic Documents and in accordance with
the provisions of this Agreement. No implied covenants or obligations shall be
read into this Agreement.
(b) Notwithstanding the foregoing, the Owner Trustee shall be
deemed to have discharged its duties and responsibilities hereunder and under
the Basic Documents to the extent the Administrator has agreed in the
Administration Agreement to perform any act or to discharge any duty of the
Owner Trustee hereunder or under any Basic Document, and the Owner Trustee shall
not be liable for the default or failure of the Administrator to carry out its
obligations under the Administration Agreement.
(c) The Owner Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting on any document believed by it to
be genuine and to have been signed or presented by the proper Person. The Owner
Trustee shall not be bound to make any investigation into any fact or matter
stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, approval, bond or other paper or document.
(d) The Owner Trustee may not be relieved from liability for
its own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this Section 6.1(d) shall not limit the effect of
Section 6.1(a) or (b);
(ii) the Owner Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer unless it
is proved that the Owner Trustee was negligent in ascertaining the
pertinent facts; and
(iii) the Owner 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 4.1, 4.2
or 6.4.
(e) Subject to Sections 5.1 and 5.2, monies received by the
Owner Trustee hereunder need not be segregated in any manner except to the
extent required by law or the Trust Sale and Servicing Agreement and may be
deposited under such general conditions as may be prescribed by law, and the
Owner Trustee shall not be liable for any interest thereon.
(f) The Owner Trustee shall not take any action that (i) is
inconsistent with the purposes of the Trust set forth in Section 2.3 or (ii)
would, to the actual knowledge of a Responsible
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Officer of the Owner Trustee, result in the Trust's becoming taxable as a
corporation for federal income tax purposes.
(g) The Certificateholders shall not direct the Owner Trustee
to take action that would violate the provisions of this Section 6.1.
SECTION 6.2 Rights of Owner Trustee. The Owner Trustee is
authorized and directed to execute and deliver the Basic Documents and each
certificate or other document attached as an exhibit to or contemplated by the
Basic Documents to which the Trust is to be a party, in such form as the
Transferor shall approve as evidenced conclusively by the Owner Trustee's
execution thereof. In addition to the foregoing, the Owner Trustee is
authorized, but shall not be obligated, to take all actions required of the
Trust pursuant to the Basic Documents. The Owner Trustee is further authorized
from time to time to take such action as the Administrator recommends with
respect to the Basic Documents.
SECTION 6.3 Acceptance of Trusts and Duties. Except as
otherwise provided in this Article VI, 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. 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 and this Agreement. The Owner Trustee shall not
be liable or accountable hereunder or under any Basic Document under any
circumstances, except (i) for its own negligent action, its own negligent
failure to act or its own wilful misconduct or (ii) in the case of the
inaccuracy of any representation or warranty contained in Section 6.6 and
expressly made by the Owner Trustee. In particular, but not by way of limitation
(and subject to the exceptions set forth in the preceding sentence):
(a) the Owner Trustee shall at no time have any responsibility
or liability for or with respect to the legality, validity and enforceability of
any Receivable held by the Trust, or the perfection and priority of any security
interest created by any such Receivable in any Vehicle or the maintenance of any
such perfection and priority, or for or with respect to the sufficiency of the
Owner Trust Estate or its ability to generate the distributions and payments to
be made to Certificateholders under this Agreement or to Noteholders under the
Indenture, including, without limitation: the existence and contents of any such
Receivable on any computer or other record thereof; the validity of the
assignment of any such Receivable to the Trust or of any intervening assignment;
the completeness of any such Receivable; the performance or enforcement of any
such Receivable; the compliance by the Transferor or the Servicer with any
warranty or representation made under any Basic Document or in any related
document or the accuracy of any such warranty or representation or any action of
the Administrator, the Indenture Trustee or the Servicer or any subservicer
taken in the name of the Owner Trustee;
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(b) the Owner Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in accordance with the instructions of
the Administrator or any Certificateholder;
(c) no provision of this Agreement or any 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 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 any amounts payable with
respect to the Certificates;
(e) the Owner Trustee shall not be responsible for or in
respect of and makes no representation as to the validity or sufficiency of any
provision 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 Basic Documents, the Notes, the Certificates (other than the certificate of
authentication on the Certificates) or of any Receivables held by the Trust or
any related documents, and the Owner Trustee shall in no event assume or incur
any liability, duty or obligation to any Noteholder or to any Certificateholder,
other than as expressly provided for herein and in the Basic Documents;
(f) the Owner Trustee shall not be liable for the default or
misconduct of the Administrator, the Indenture Trustee, the Transferor or the
Servicer under any of the Basic Documents or otherwise, and the Owner Trustee
shall have no obligation or liability to perform the obligations of the Trust
under this Agreement or the Basic Documents that are required to be performed by
the Administrator under the Administration Agreement, the Indenture Trustee
under the Indenture or the Servicer under the Trust Sale and Servicing
Agreement; and
(g) the Owner Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Agreement, or to institute,
conduct or defend any litigation under this Agreement or otherwise or in
relation to this Agreement or any Basic Document, at the request, order or
direction of any of the Certificateholders, unless such Certificateholders have
offered to the Owner Trustee security or indemnity satisfactory to it against
the costs, expenses and liabilities that may be incurred by the Owner Trustee
therein or thereby. The right of the Owner Trustee to perform any discretionary
act enumerated in this Agreement or in any Basic Document shall not be construed
as a duty, and the Owner Trustee shall not be answerable for other than its
negligence or wilful misconduct in the performance of any such act.
SECTION 6.4 Action upon Instruction by Certificateholders.
(a) Subject to Section 4.4 , the Certificateholders may by
written instruction direct the Owner Trustee in the management of the Trust.
Such direction may be exercised at any time by written instruction of the
Certificateholders pursuant to Section 4.5.
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(b) Notwithstanding the foregoing, the Owner Trustee shall not
be required to take any action hereunder or under any Basic Document if the
Owner Trustee shall have reasonably determined, or shall have been advised by
counsel, that such action is likely to result in liability on the part of the
Owner Trustee or is contrary to the terms hereof or of any Basic Document or is
otherwise contrary to law.
(c) Whenever the Owner Trustee is unable to decide between
alternative courses of action permitted or required by the terms of this
Agreement or any Basic Document, or is unsure as to the application, intent,
interpretation or meaning of any provision of this Agreement or the Basic
Documents, the Owner Trustee shall promptly give notice (in such form as shall
be appropriate under the circumstances) to the 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 such instruction
received, the Owner Trustee shall not be liable on account of such action to any
Person. If the Owner Trustee shall not have received appropriate instructions
within ten days of such notice (or within such shorter period of time as
reasonably may be specified in such notice or may be necessary under the
circumstances) it may, but shall be under no duty to, take or refrain from
taking such action which is consistent, in its view, with this Agreement or the
Basic Documents, and as it shall deem to be in the best interests of the
Certificateholders, and the Owner Trustee shall have no liability to any Person
for any such action or inaction.
SECTION 6.5 Furnishing of Documents. The Owner Trustee shall
furnish (a) to the Certificateholders, promptly upon receipt of a written
request therefor, duplicates or copies of all reports, notices, requests,
demands, certificates, financial statements and any other instruments furnished
to the Owner Trustee under the Basic Documents and (b) to the Noteholders and
the Certificateholders, promptly upon receipt of a written request therefor,
copies of the Receivables Purchase Agreement, the Trust Sale and Servicing
Agreement, the Administration Agreement, and this Agreement.
SECTION 6.6 Representations and Warranties of Owner Trustee.
The Owner Trustee hereby represents and warrants to the Transferor, for the
benefit of the Certificateholders, that:
(a) It is a banking corporation duly organized, validly
existing and in good standing under the laws of the state of its incorporation.
(b) It has full power, authority and legal right to execute,
deliver and perform this Agreement, and has taken all necessary action to
authorize the execution, delivery and performance by it of this Agreement. The
eligibility requirements set forth in Section 6.13 are satisfied with respect to
it.
(c) The execution, delivery and performance by it of this
Agreement (i) shall not violate any provision of any law or regulation governing
the banking and trust powers of the Owner Trustee or any order, writ, judgment
or decree of any court, arbitrator or governmental authority applicable to the
Owner Trustee or any of its assets, (ii) shall not violate any provision of the
corporate charter or by-laws of the Owner Trustee and (iii) shall not violate
any provision of, or
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constitute, with or without notice or lapse of time, a default under, or result
in the creation or imposition of any lien on any properties included in the
Trust pursuant to the provisions of any mortgage, indenture, contract, agreement
or other undertaking to which it is a party, which violation, default or lien
could reasonably be expected to have a materially adverse effect on the Owner
Trustee's performance or ability to perform its duties as Owner Trustee under
this Agreement or on the transactions contemplated in this Agreement.
(d) The execution, delivery and performance by the Owner
Trustee of this Agreement shall not require the authorization, consent or
approval of, the giving of notice to, the filing or registration with, or the
taking of any other action in respect of, any Governmental Authority regulating
the banking and corporate trust activities of banks or trust companies in the
jurisdiction in which the Trust was formed.
(e) This Agreement has been duly executed and delivered by the
Owner Trustee and constitutes the legal, valid and binding agreement of the
Owner Trustee, enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization, or
other similar laws affecting the enforcement of creditors' rights in general and
by general principles of equity, regardless of whether such enforceability is
considered in a proceeding in equity or at law.
(f) The Owner Trustee certifies that (a) its principal place
of business is outside the State of Florida; (b) its usual place of business
where books and records pertaining to the Trust will be kept is outside the
State of Florida; (c) it is not licensed, and is not qualified, to do business
within the State of Florida; (d) it will exercise all management and control
over the Trust Assets and over the Trust outside the State of Florida; (e) it
has no employees employed within the State of Florida; and (f) it is not
organized under the laws of the State of Florida. The Owner Trustee will certify
the above by September 30 each year this Agreement is in effect by providing an
Officer's Certificate in the form of Exhibit D attached hereto. Additionally,
the Owner Trustee certifies and agrees it will promptly notify the Transferor if
any of the above changes.
SECTION 6.7 Reliance; Advice of Counsel.
(a) The Owner Trustee shall incur no liability to anyone in
acting upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond or other document or paper believed by
it to be genuine and believed by it to be signed by the proper party or parties
and need not investigate any fact or matter in any such document. The Owner
Trustee may accept a certified copy of a resolution of the board of directors or
other governing body of any corporate party as conclusive evidence that such
resolution has been duly adopted by such body and that the same is in full force
and effect. As to any fact or matter the method of the determination of which is
not specifically prescribed herein, the Owner Trustee may for all purposes
hereof rely, without any inquiry or investigation into the factual matters
addressed therein, on a certificate, signed by the president or any vice
president or by the treasurer or other authorized officers of the relevant
party, as to such fact or matter, and such certificate shall constitute full
protection to the Owner Trustee for any action taken or omitted to be taken by
it in good faith in reliance thereon.
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(b) In the exercise or administration of the trusts hereunder
and in the performance of its duties and obligations under this Agreement or the
Basic Documents, the Owner Trustee: (i) may act directly or through its agents,
attorneys, custodians or nominees 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, attorneys, custodians or nominees if such agents, attorneys,
custodians or nominees shall have been selected by the Owner Trustee with
reasonable care; and (ii) may consult with counsel, accountants and other
skilled professionals 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
Basic Document.
SECTION 6.8 Owner Trustee May Own Certificates and Notes. The
Owner Trustee in its individual or any other capacity may become the owner or
pledgee of Certificates or Notes and may deal with the Transferor, the
Administrator, the Indenture Trustee and the Servicer in transactions in the
same manner as it would have if it were not the Owner Trustee.
SECTION 6.9 Compensation and Indemnity. The Owner Trustee
shall receive as compensation for its services hereunder such fees as have been
separately agreed upon before the date hereof between the Transferor and the
Owner Trustee, and the Owner Trustee shall be entitled to be reimbursed by the
Servicer for its other reasonable expenses hereunder, including the reasonable
compensation, expenses and disbursements of such agents, custodians, nominees,
representatives, experts and counsel as the Owner Trustee may employ in
connection with the exercise and performance of its rights and its duties
hereunder. The Servicer shall indemnify the Owner Trustee and its successors,
assigns, agents and servants in accordance with the provisions of Section 6.4 of
the Trust Sale and Servicing Agreement. The indemnities contained in this
Section 6.9 shall survive the resignation or termination of the Owner Trustee or
the termination of this Agreement. Any amounts paid to the Owner Trustee
pursuant to this Section 6.9 shall be deemed not to be a part of the Owner Trust
Estate immediately after such payment.
SECTION 6.10 Replacement of Owner Trustee.
(a) The Owner Trustee may at any time give notice of its
intent to resign and be discharged from the trusts hereby created by giving
written notice thereof to the Administrator; provided that no such resignation
shall become effective, and the Owner Trustee shall not resign, prior to the
time set forth in Section 6.10(c). The Administrator may appoint a successor
Owner Trustee by delivering written instrument, in duplicate, to the resigning
Owner Trustee and the successor Owner Trustee. If no successor Owner Trustee
shall have been appointed and have accepted appointment within 30 days after the
giving of such notice, the resigning Owner Trustee giving such notice may
petition any court of competent jurisdiction for the appointment of a successor
Owner Trustee. The Administrator shall remove the Owner Trustee if:
(i) the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 6.13 and shall fail to resign
after written request therefor by the Administrator;
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(ii) the Owner Trustee shall be adjudged bankrupt
or insolvent;
(iii) a receiver or other public officer shall be
appointed or take charge or control of the Owner Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation; or
(iv) the Owner Trustee shall otherwise be incapable
of acting.
(b) If the Owner Trustee resigns or is removed or if a vacancy
exists in the office of Owner Trustee for any reason the Administrator shall
promptly appoint a successor Owner Trustee by written instrument, in duplicate
(one copy of which instrument shall be delivered to the outgoing Owner Trustee
so removed and one copy to the successor Owner Trustee) and shall pay all fees
owed to the outgoing Owner Trustee.
(c) Any resignation or removal of the Owner Trustee and
appointment of a successor Owner Trustee pursuant to any of the provisions of
this Section 6.10 shall not become effective, and no such resignation shall be
deemed to have occurred, until a written acceptance of appointment is delivered
by the successor Owner Trustee to the outgoing Owner Trustee and the
Administrator, and all fees and expenses due to the outgoing Owner Trustee are
paid. Any successor Owner Trustee appointed pursuant to this Section 6.10 shall
be eligible to act in such capacity in accordance with Section 6.13 and,
following compliance with the preceding sentence, 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
Administrator shall provide notice of such resignation or removal of the Owner
Trustee to each of the Rating Agencies.
(d) The predecessor Owner Trustee shall upon payment of its
fees and expenses deliver to the successor Owner Trustee all documents, computer
files and statements and monies held by it under this Agreement. 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.
(e) Upon acceptance of appointment by a successor Owner
Trustee pursuant to this Section 6.10, the Administrator shall mail notice of
the successor of such Owner Trustee to all Certificateholders, the Indenture
Trustee, the Noteholders, the Agent and the Rating Agencies.
SECTION 6.11 Merger or Consolidation of Owner Trustee. Any
Person into which the Owner Trustee may be merged or converted or with which it
may be consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Owner Trustee shall be a party, or any Person
succeeding to all or substantially all of the corporate trust business of the
Owner Trustee, shall be the successor of the Owner Trustee hereunder, provided
such Person shall be eligible pursuant to Section 6.13, and without the
execution or filing of any instrument or any further act on the part of any of
the parties hereto; provided, however, that the Owner Trustee shall mail notice
of such merger or consolidation to the Rating Agencies.
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SECTION 6.12 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this Agreement, at
any time, for the purpose of meeting any legal requirement of any jurisdiction
in which any part of the Owner Trust Estate or any of the Dealers may at the
time be located, the Administrator and the Owner Trustee acting jointly shall
have the power and shall execute and deliver all instruments to appoint one or
more Persons approved by the Owner Trustee to act as co-trustee, jointly with
the Owner Trustee, or as separate trustee or trustees, of all or any part of the
Owner Trust Estate, and to vest in such Person, in such capacity, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 6.12, such powers, duties, obligations, rights and trusts as the
Administrator and the Owner Trustee may consider necessary or desirable. If the
Administrator shall not have joined in such appointment within 15 days after the
receipt by it of a request so to do, the Owner Trustee alone shall have the
power to make such appointment. No co-trustee or separate trustee under this
Agreement shall be required to meet the terms of eligibility as a successor
trustee pursuant to Section 6.13 and no notice of the appointment of any
co-trustee or separate trustee shall be required pursuant to Section 6.10.
(b) Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations
conferred or imposed upon the Owner Trustee shall be conferred upon and
exercised or performed by the Owner Trustee and such separate trustee
or co-trustee jointly (it being understood that such separate trustee
or co-trustee is not authorized to act separately without the Owner
Trustee joining in such act), except to the extent that under any law
of any jurisdiction in which any particular act or acts are to be
performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties
and obligations (including the holding of title to the Trust or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-trustee, but solely at
the direction of the Owner Trustee;
(ii) no trustee under this Agreement shall be
personally liable by reason of any act or omission of any other trustee
under this Agreement; and
(iii) the Administrator and the Owner Trustee acting
jointly 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 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
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Trustee. Each such instrument shall be filed with the Owner Trustee and a copy
thereof given to the Administrator.
(d) Any separate trustee or co-trustee may at any time appoint
the Owner Trustee as its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Agreement on its behalf and in its name. If any separate trustee
or co-trustee shall die, become incapable of acting, resign or be removed, all
of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Owner Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 6.13 Eligibility Requirements for Owner Trustee. The
Owner Trustee shall at all times satisfy the requirements of Section 26(a)(1) of
the Investment Company Act. The Owner Trustee shall at all times: (a) be a
corporation satisfying the provisions of Section 3807(a) of the Business Trust
Statute; (b) be authorized to exercise corporate trust powers; (c) have an
aggregate capital, surplus and undivided profits of at least $50,000,000 and be
subject to supervision or examination by federal or state authorities; and (d)
have (or have a parent which has) a long-term unsecured debt rating of at least
BBB- by Standard & Poor's and at least Baa3 by Moody's. If such corporation
shall publish reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purpose of this Section 6.13, the aggregate capital, surplus and undivided
profits of such corporation shall be deemed to be its aggregate capital, surplus
and undivided profits as set forth in its most recent report of condition so
published. If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of this Section 6.13, the Owner Trustee shall
resign immediately in the manner and with the effect specified in Section 6.10.
ARTICLE VII
TERMINATION OF TRUST AGREEMENT
SECTION 7.1 Termination of Trust Agreement.
(a) The Trust shall dissolve and be wound up in accordance
with Section 3808 of the Business Trust Statute on the date (the "Trust
Termination Date") on which the first of the following occurs: (i) if the
Transferor so elects, the day following the Distribution Date on which all
amounts required to be paid to the Securityholders pursuant to the Basic
Documents have been paid (or deposited in the Note Distribution Account, or the
Certificate Distribution Account) and the aggregate Outstanding Amount of all
Series of Notes is zero and (ii) the Specified Trust Termination Date. This
Agreement and the obligations of the parties hereunder (other than Section 6.9
hereof and as otherwise expressly provided herein) shall terminate and be of no
further force or effect (i) if the Trust Termination Date is determined pursuant
to clause (i) above, on the Trust Termination Date and (ii) if the Trust
Termination Date is determined pursuant to clause (ii) above, on the date
following the Distribution Date on which the final payments to be made to the
Securityholders pursuant to the Basic Documents have been paid (or deposited in
the appropriate Trust Accounts).
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(b) Except as provided in Section 7.1(a), neither the
Transferor nor any Certificateholder shall be entitled to revoke or terminate
the Trust or this Agreement. The bankruptcy, liquidation, dissolution, death or
incapacity of any Certificateholder shall not (x) operate to terminate this
Agreement or the Trust, nor (y) entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding-up of all or any part of the
Trust or the Owner Trust Estate nor (z) otherwise affect the rights, obligations
and liabilities of the parties hereto.
(c) Notice of any termination of the Trust specifying the
Payment Date upon which the Certificateholders shall surrender their
Certificates to the Paying Agent for payment of the final distribution and
cancellation, shall be given by the Owner Trustee by letter to the
Certificateholders mailed within five Business Days of receipt of notice of such
termination from the Servicer, stating: (i) the Payment Date upon or with
respect to which the final distribution of the Certificate Balance of the
Certificates shall be made upon presentation and surrender of the Certificates
at the office of the Paying Agent therein designated; (ii) the amount of any
such final distribution of the Certificate Balance; and (iii) that the Record
Date otherwise applicable to such Payment Date is not applicable, distributions
being made only upon presentation and surrender of the Certificates 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 Certificateholders. Upon
presentation and surrender of the Certificates, the Paying Agent shall cause to
be distributed to Certificateholders amounts distributable on such Payment Date
pursuant to Section 5.2.
(d) If all of the Certificateholders shall not surrender their
Certificates for cancellation within six months after the date specified in the
written notice specified in Section 7.1(c), the Owner Trustee shall give a
second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within one year after the second notice all the Certificates shall
not have been surrendered for cancellation, the Owner Trustee may take
appropriate steps, or may appoint an agent to take appropriate steps, to contact
the remaining Certificateholders concerning surrender of their Certificates, and
the cost thereof shall be paid out of the funds and other assets that shall
remain subject to this Agreement. Subject to applicable laws with respect to
escheat of funds, any funds remaining in the Trust after exhaustion of such
remedies in the preceding sentence shall be deemed property of the Transferor
and distributed by the Owner Trustee to the Transferor and the Owner Trustee
shall have no further liability to the Certificateholders with respect thereto.
(e) Upon the winding up of the Trust and its termination, the
Owner Trustee shall cause the Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State of the State of Delaware
in accordance with the provisions of Section 3810 of the Business Trust Statute.
(f) Within sixty days of the later of (i) the cancellation of
all Certificates pursuant to Section 7.1(c) or Section 7.1(d), or (ii) payment
to the Transferor of funds remaining in the Trust pursuant to Section 7.1(d),
the Owner Trustee shall provide each of the Rating Agencies with written
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notice stating that all Certificates have been so canceled or such funds have
been so paid to the Transferor.
ARTICLE VIII
AMENDMENTS
SECTION 8.1 Amendments Without Consent of Securityholders.
This Agreement may be amended by the Transferor and the Owner Trustee without
the consent of any of the Securityholders or Enhancement Providers (but with
prior notice to the Rating Agencies and the Indenture Trustee) to (i) cure any
ambiguity, (ii) correct or supplement any provision in this Agreement that may
be defective or inconsistent with any other provision in this Agreement, (iii)
add or supplement any liquidity, credit or other enhancement arrangement for the
benefit of any Securityholders or Enhancement Providers (provided that if any
such addition shall affect any series of Securityholders differently than any
other series of Securityholders, then such addition shall not, as evidenced by
an Opinion of Counsel, adversely affect in any material respect the interests of
any series of Securityholders), (iv) add to the covenants, restrictions or
obligations of the Transferor, the Servicer, the Trust, or the Owner Trustee for
the benefit of the Securityholders or Enhancement Providers and (v) add, change
or eliminate any other provision of this Agreement in any manner that shall not,
as evidenced by an Opinion of Counsel, materially and adversely affect the
interests of the Securityholders or Enhancement Providers.
SECTION 8.2 Amendments With Consent of Securityholders. This
Agreement may be amended from time to time by the Transferor and the Owner
Trustee with the consent of Noteholders whose Notes evidence not less than a
majority of the Outstanding Amount of the Notes as of the close of business on
the preceding Payment Date and the consent of Certificateholders whose
Certificates evidence not less than a majority of the Voting Interests as of the
close of business on the preceding Payment Date (which consent, whether given
pursuant to this Section 8.2 or pursuant to any other provision of this
Agreement, shall be conclusive and binding on such Person and on all future
Holders of such Notes or Certificates and of any Notes or Certificates issued
upon the transfer thereof or in exchange thereof or in lieu thereof whether or
not notation of such consent is made upon the Notes or Certificates) for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Agreement, or of modifying in any manner the rights of
the Noteholders or the Certificateholders; provided, however, that no such
amendment shall (a) increase or reduce in any manner the amount of, or
accelerate or delay the timing of, distributions that shall be required to be
made on any Security without the consent of the Holder thereof (it being
understood that the issuance of any Securities after the Initial Closing Date as
contemplated by this Agreement, the Trust Sale and Servicing Agreement and the
Indenture and the specification of the terms and provisions thereof pursuant to
a Series Supplement shall not be deemed to have such effect for purposes
hereof), (b) adversely affect the rating of any series of Securities without the
consent of the Holders of two-thirds of the Outstanding Amount of such series of
Notes or the Voting Interests with respect to such Certificates, as appropriate
or (c) reduce the aforesaid percentage required to consent to any such
amendment, without the consent of the Holders of all of the Notes and all of the
Voting Interests with respect to Certificates then outstanding. Prior to the
execution of any such amendment, supplement or consent, the Owner Trustee shall
furnish written notification
24
<PAGE>
of the substance of such amendment, supplement or consent to the Rating Agencies
and the Indenture Trustee.
SECTION 8.3 Form of Amendments.
(a) Promptly after the execution of any amendment, supplement
or consent pursuant to Section 8.1 or 8.2, the Owner Trustee shall furnish
written notification of the substance of such amendment or consent to each
Certificateholder and the Indenture Trustee.
(b) It shall not be necessary for the consent of
Securityholders or the Indenture Trustee pursuant to Section 8.2 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 Securityholders provided for in this
Agreement or in any other Basic Document) and of evidencing the authorization of
the execution thereof by Securityholders shall be subject to such reasonable
requirements as the Owner Trustee may prescribe.
(c) Promptly after the execution of any amendment to the
Certificate of Trust, the Owner Trustee shall cause the filing of such amendment
with the Secretary of State of the State of Delaware.
(d) Prior to the execution of any amendment to this Agreement
or the Certificate of Trust, the Owner Trustee shall be entitled to receive and
rely upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement. The Owner Trustee may, but shall not
be obligated to, enter into any such amendment which affects the Owner Trustee's
own rights, duties or immunities under this Agreement or otherwise.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 No Legal Title to Owner Trust Estate. The
Certificateholders shall not have legal title to any part of the Owner Trust
Estate. The Certificateholders shall be entitled to receive distributions with
respect to their undivided ownership interest therein only in accordance with
Articles V and VII. No transfer, by operation of law or otherwise, of any right,
title, and interest of the Certificateholders to and in their ownership interest
in the Owner Trust Estate 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 9.2 Limitations on Rights of Others. Except for
Sections 2.7, 7.1(c), 7.1(f) and 9.12, the provisions of this Agreement are
solely for the benefit of the Owner Trustee, the Transferor, the
Certificateholders, the Administrator and, to the extent expressly provided
herein, the Indenture Trustee and the Noteholders, and nothing in this
Agreement, whether express or implied, shall be construed to give to any other
Person any legal or equitable right, remedy or claim in the Owner Trust Estate
or under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.
25
<PAGE>
SECTION 9.3 Notices. All demands, notices and communications
upon or to the Transferor, the Servicer, the Administrator, the Indenture
Trustee, the Owner Trustee or the Rating Agencies or any Certificateholder under
this Agreement shall be delivered as specified in Appendix B to the Trust Sale
and Servicing Agreement.
SECTION 9.4 Severability of Provisions. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed enforceable to the fullest extent permitted, and if not
so permitted, shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Agreement or of the
Certificates or the rights of the Holders thereof.
SECTION 9.5 Counterparts. This Agreement may be executed in
two or more counterparts (and by different parties on separate counterparts),
each of which shall be an original, but all of which together shall constitute
one and the same instrument.
SECTION 9.6 Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
the Transferor, the Owner Trustee and each Certificateholder and their
respective successors and permitted assigns, all as herein provided. Any
request, notice, direction, consent, waiver or other instrument or action by a
Certificateholder shall bind the successors and assigns of such
Certificateholder.
SECTION 9.7 No Petition Covenant. Notwithstanding any prior
termination of this Agreement, the Trust (or the Owner Trustee on behalf of the
Trust), and each Certificateholder, by accepting a Certificate (or interest
therein) issued hereunder, hereby covenant and agree that they shall not, prior
to the day that is one year and one day after the termination of this Agreement,
acquiesce, petition or otherwise invoke or cause the Transferor or the Trust to
invoke in any court or government authority for the purpose of commencing or
sustaining a case against the Transferor or the Trust under any federal or state
bankruptcy, insolvency or similar law or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of the
Transferor or the Trust or any substantial part of its property, or ordering the
winding up or liquidation of the affairs of the Transferor or the Trust.
SECTION 9.8 No Recourse. Each Certificateholder, by accepting
a Certificate (or interest therein), acknowledges that such Person's Certificate
(or interest therein) represents beneficial interests in the Trust only and does
not represent interests in or obligations of the Transferor, the Servicer, the
Administrator, the Owner Trustee, the Indenture Trustee or any Affiliate thereof
and no recourse, either directly or indirectly, may be had against such parties
or their assets, except as may be expressly set forth or contemplated in this
Agreement, the Certificates or the Basic Documents. Except as expressly provided
in the Basic Documents, neither the Transferor, the Servicer nor the Owner
Trustee in their respective individual capacities, nor any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors or
assigns, shall be personally liable for, nor shall recourse be had to any of
them for, the distribution of any amount with
26
<PAGE>
respect to the Certificates, or the Owner Trustee's performance of, or omission
to perform, any of the covenants or obligations contained in the Certificates or
this Agreement, it being expressly understood that said covenants and
obligations have been made by the Owner Trustee solely in its capacity as the
Owner Trustee. Each Certificateholder by the acceptance of a Certificate (or
beneficial interest therein) shall agree that, except as expressly provided in
the Basic Documents, in the case of nonpayment of any amounts with respect to
the Certificates, it shall have no claim against any of the foregoing for any
deficiency, loss or claim therefrom.
SECTION 9.9 Headings. The headings herein are for purposes of
reference only and shall not affect the meaning or interpretation of any
provision hereof.
SECTION 9.10 Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF DELAWARE,
WITHOUT REFERENCE TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF OR OF ANY OTHER
JURISDICTION, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 9.11 Certificate Transfer Restrictions. The
Certificates may not be acquired by or for the account of (i) an employee
benefit plan (as defined in Section 3(3) of ERISA) that is subject to the
provisions of Title I of ERISA, (ii) a plan described in Section 4975(e)(1) of
the Code or (iii) any entity whose underlying assets include plan assets by
reason of a plan's investment in the entity (each a "Benefit Plan"). By
accepting and holding a Certificate, the Holder thereof shall be deemed to have
represented and warranted that it is not a Benefit Plan.
SECTION 9.12 Indemnification by and Reimbursement of the
Servicer. The Owner Trustee acknowledges and agrees to reimburse (i) the
Servicer and its directors, officers, employees and agents in accordance with
Section 3.2 of the Trust Sale and Servicing Agreement and (ii) the Transferor
and its directors, officers, employees and agents in accordance with Section 6.3
of the Trust Sale and Servicing Agreement. The Owner Trustee further
acknowledges and accepts the conditions and limitations with respect to the
Servicer's obligation to indemnify, defend and hold the Owner Trustee harmless
as set forth in Section 6.4 of the Trust Sale and Servicing Agreement.
SECTION 9.13 Third-Party Beneficiaries. This Agreement will
inure to the benefit of and be binding upon the parties hereto, the
Securityholders, the Enhancement Providers, the Indenture Trustee and their
respective successors and permitted assigns. Except as otherwise expressly
provided in this Agreement, no other Person will have any right or obligation
hereunder.
* * * * *
27
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed by their respective officers hereunto duly
authorized, as of the day and year first above written.
CHASE MANHATTAN BANK DELAWARE
as Owner Trustee
By:__________________________________
Name:
Title:
WODFI LLC, as Transferor
By:__________________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
Acknowledged and Accepted:
WORLD OMNI FINANCIAL CORP.,
as Servicer
By: __________________________
Name: Eric M. Gebhard
Title: Assistant Secretary
28
<PAGE>
EXHIBIT A
NUMBER
R-1
OWNERSHIP INTEREST: 100%
SEE REVERSE FOR CERTAIN DEFINITIONS
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF
(i) AN "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, ("ERISA"))
THAT IS SUBJECT TO THE PROVISIONS OF TITLE I OF ERISA, (ii) A PLAN
DESCRIBED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE"), OR (iii) ANY ENTITY WHOSE UNDERLYING ASSETS
INCLUDE PLAN ASSETS BY REASON OF A PLAN'S INVESTMENT IN THE ENTITY. BY
ACCEPTING AND HOLDING THIS CERTIFICATE, THE HOLDER HEREOF AND THE
CERTIFICATE OWNER SHALL EACH BE DEEMED TO HAVE REPRESENTED AND
WARRANTED THAT IT IS NOT A BENEFIT PLAN.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY
ISSUED ON NOVEMBER 22, 1999. HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER.
WORLD OMNI MASTER OWNER TRUST
CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of wholesale receivables
generated from time to time in a portfolio of revolving financing
arrangement with dealers to finance automobile and light duty truck
inventories thereon and certain other properties.
(This Certificate does not represent an interest in or obligation of
World Omni Financial Corp., WODFI LLC, the Owner Trustee or any of
their respective affiliates, except to the extent described below.)
A-1
<PAGE>
THIS CERTIFIES THAT WODFI LLC is the registered owner of a
nonassessable, fully-paid, fractional undivided interest in World Omni Master
Owner Trust (the "Trust").
The Trust was created pursuant to a trust agreement, dated as
of November 22, 1999 (as amended restated or supplemented from time to time, the
"Trust Agreement"), between the Transferor and Chase Manhattan Bank Delaware, as
owner trustee (the "Owner Trustee"), a summary of certain of the pertinent
provisions of which is set forth below. To the extent not otherwise defined
herein, the capitalized terms used herein have the meanings assigned to them in
the Trust Agreement.
This Certificate is issued under and is subject to the terms,
provisions and conditions of the Trust Agreement, the terms of which are
incorporated herein by reference and made a part hereof, to which Trust
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
The Holder of this Certificate acknowledges and agrees that
its rights to receive distributions in respect of this Certificate are
subordinated to the rights of the Noteholders as and to the extent described in
the Trust Sale and Servicing Agreement and the Indenture.
Each Certificateholder with respect to a Certificate, by its
acceptance of a Certificate, covenants and agrees that such Certificateholder
with respect to a Certificate, shall not, prior to the date which is one year
and one day after the termination of the Trust Agreement, acquiesce, petition or
otherwise invoke or cause the Transferor to invoke the process of any court or
governmental authority for the purpose of commencing or sustaining a case
against the Transferor under any federal or state bankruptcy, insolvency,
reorganization or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Transferor or
any substantial part of its property, or ordering the winding up or liquidation
of the affairs of the Transferor.
Distributions on this Certificate shall be made as provided in
the Trust Agreement by wire transfer, check mailed or, where possible,
intra-bank book entry to the Certificateholder of record in the Certificate
Register without the presentation or surrender of this Certificate or the making
of any notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Certificate shall be
made after due notice by the Owner Trustee of the pendency of such distribution
and only upon presentation and surrender of this Certificate at the office
maintained for such purpose by the Owner Trustee in the City of Wilmington, the
State of Delaware.
Reference is hereby made to further provisions of this
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.
A-2
<PAGE>
Unless the certificate of authentication hereon shall have
been executed by an authorized officer of the Owner Trustee by manual signature,
this Certificate shall not entitle the Holder hereof to any benefit under the
Trust Agreement or the Trust Sale and Servicing Agreement or be valid for any
purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS OR ANY OTHER
JURISDICTION'S CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
A-3
<PAGE>
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust
and not in its individual capacity, has caused this Certificate to be duly
executed.
Dated: November 22, 1999
WORLD OMNI MASTER OWNER TRUST
By: CHASE MANHATTAN BANK DELAWARE
not in its individual capacity but solely as
Owner Trustee
By:_________________________________
Name:
Title:
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Trust Agreement.
CHASE MANHATTAN BANK DELAWARE OR ______________________________
not in its individual capacity but solely as not in its individual capacity
Owner Trustee but solely as Authenticating
Agent by______________________
Authenticating Agent
By: _______________________________ By: _________________________
Authorized Officer Authorized Officer
A-4
<PAGE>
REVERSE OF CERTIFICATE
The Certificates do not represent an obligation of, or an
interest in, the Transferor, the Servicer, World Omni Financial Corp., the
Indenture Trustee, the Owner Trustee or any affiliates of any of them 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
Basic Documents. In addition, this Certificate is not guaranteed by any
governmental agency or instrumentality and is limited in right of payment to
certain collections and recoveries with respect to the Receivables (and certain
other amounts), all as more specifically set forth herein, in the Trust
Agreement and the Trust Sale and Servicing Agreement. A copy of each of the
Trust Sale and Servicing Agreement and the Trust Agreement may be examined
during normal business hours at the principal office of the Transferor, and at
such other places, if any, designated by the Transferor, by any
Certificateholder upon written request.
The Trust Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Transferor and the rights of the Certificateholders under the
Trust Agreement at any time by the Transferor and the Owner Trustee with the
consent of (i) the Holders of the Notes evidencing not less than a majority of
the Outstanding Amount of the Voting Interests, and (ii) Certificateholders
whose Certificates evidence not less than a majority of the ownership interest
in the Trust, each as of the close of the preceding Payment Date. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and on all future Holders of this Certificate and of any Certificate
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Trust Agreement also permits the amendment thereof, in certain
circumstances, without the consent of the Holders of any of the Certificates or
the Notes.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registerable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies of the Certificate Registrar maintained
by the Owner Trustee in the State of Delaware, accompanied by (i) a written
instrument of transfer in form satisfactory to the Owner Trustee and the
Certificate Registrar duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing and (ii) certain opinions required by
Section 3.4 of the Trust Agreement, and thereupon one or more new Certificates
of authorized denominations evidencing the same aggregate interest in the Trust
will be issued to the designated transferee. The initial Certificate Registrar
appointed under the Trust Agreement is the Owner Trustee.
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 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 distribution to
Certificateholders of all amounts required to be distributed to them pursuant to
the Trust Agreement and the Trust Sale and Servicing Agreement.
A-5
<PAGE>
CERTIFICATE OF TRANSFER
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 Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_________________________________________________________ Attorney to transfer
said Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated: ____________________________________*
Signature Guaranteed:
*
____________________________________
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
A-6
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
________________________________________________________________________________
(Please print or type name and address, including postal zip code, of assignee
________________________________________________________________________________
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
________________________________________________Attorney to transfer said
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated: _______________________________*
Signature Guaranteed:
_______________________________*
*NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
A-7
<PAGE>
EXHIBIT B
CERTIFICATE OF TRUST OF
WORLD OMNI MASTER OWNER TRUST
-----------------------------
THIS CERTIFICATE OF TRUST of World Omni Master Owner Trust
(the "Trust"), dated as of November 22, 1999, is being duly executed and filed
by Chase Manhattan Bank Delaware, a Delaware banking corporation, as trustee, to
form a business trust under the Delaware Business Trust Act (12 Del. C. ss.3801
et seq.).
1. Name. The name of the business trust formed hereby is World
Omni Master Owner Trust.
2. Delaware Trustee. The name and business address of the
trustee of the Trust in the State of Delaware is Chase Manhattan Bank Delaware,
1201 Market Street, Corporate Trust, 9th Floor, Wilmington, Delaware 19801.
3. This Certificate of Trust shall be effective on November
22, 1999.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of
the Trust, has executed this Certificate of Trust as of the date first-above
written.
Chase Manhattan Bank Delaware,
not in its individual capacity
but solely as Owner Trustee under
a Trust Agreement dated as of
November 22, 1999.
By: ___________________________
Name:
Title:
B-1
<PAGE>
EXHIBIT C
INVESTOR LETTER
---------------
WODFI LLC
Corporation Service Company
1013 Centre Road
Wilmington, Delaware 19805
________________________
Ladies and Gentlemen:
In connection with our proposed purchase of the_____________
(the "Certificate"), representing a fractional undivided interest in the World
Omni Master Owner Trust, issued under a trust agreement, dated as of November
22, 1999 (the "Trust Agreement"), between WODFI LLC, a Delaware limited
liability company (the "Transferor") and Chase Manhattan Bank Delaware, as owner
trustee, acting thereunder not in its individual capacity but solely as owner
trustee of the Trust (the "Owner Trustee"), we confirm that:
1. We understand that the Certificate has not been registered
under the Securities Act of 1933, as amended (the "Securities
Act"), and may not be sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf
of any accounts for which we are acting as hereinafter stated,
that such Certificate may be resold, pledged or transferred
only (i) to the Transferor, (ii) to an institutional investor
that is an "accredited investor" as defined in Rule 501(a)(1),
(2), (3) or (7) (an "Institutional Accredited Investor") under
the Securities Act (as indicated by the box checked by the
transferor on the Certificate of Transfer on the reverse of
the certificate for the Certificate) acting for its own
account (and not for the account of others) or as a fiduciary
or agent for others (which others also are Institutional
Accredited Investors unless the holder is a bank acting in its
fiduciary capacity) that executes a certificate substantially
in the form hereof, (iii) so long as such Certificate is
eligible for resale pursuant to Rule 144A under the Securities
Act ("Rule 144A"), to a person whom we reasonably believe
after due inquiry to be a "qualified institutional buyer" as
defined in Rule 144A acting for its own account (and not for
the account of others) or as a fiduciary or agent for others
(which others also are "qualified institutional buyers") to
whom notice is given that the resale, pledge or transfer is
being made in reliance on Rule 144A, or (iv) in a sale, pledge
or other transfer made in a transaction otherwise exempt from
the registration requirements of the Securities Act, in which
case (A) the Owner Trustee shall require that both the
prospective transferor and the prospective transferee certify
to the Owner Trustee and the Transferor in writing the facts
surrounding such transfer, which certification shall be in
form and substance satisfactory to the Owner Trustee and the
Transferor, and
C-1
<PAGE>
(B) the Owner Trustee may require a written opinion of counsel
(which will not be at the expense of the Transferor or the
Owner Trustee) satisfactory to the Transferor and the Owner
Trustee to the effect that such transfer will not violate the
Securities Act, in each case in accordance with any applicable
securities laws of any state of the United States. We will
notify any purchaser of the Certificate from us of the above
resale restrictions, if then applicable. We further understand
that in connection with any transfer of the Certificate by us
that the Transferor and the Owner Trustee may request, and if
so requested we will furnish, such certificates and other
information as they may reasonably require to confirm that any
such transfer complies with the foregoing restrictions. We
understand that no sale, pledge or other transfer may be made
to any one person for Certificates with a face amount of less
than $___________ (or such other amount as the Transferor may
determine in order to prevent the Trust from being treated as
a "publicly traded partnership" under Section 7704 of the
Code, but in no event less than $250,000) and, in the case of
any person acting on behalf of one or more third parties
(other than a bank (as defined in Section 3(a)(2) of the
Securities Act) acting in its fiduciary capacity), for
Certificates with a face amount of less than such amount for
each such third party. Any attempted transfer will be void ab
initio and the purported transferor will continue to be
treated as the owner of the offered Certificates for all
purposes.
2.
[CHECK ONE]
[ ] (a) We are an institutional investor and an
"accredited investor" (as defined in Rule 501(a)(1),
(2), (3) or (7) of Regulation D under the Securities
Act) acting for our own account (and not for the
account of others) or as a fiduciary or agent for
others (which others also are Institutional
Accredited Investors unless we are bank acting in its
fiduciary capacity). We have such knowledge and
experience in financial and business matters as to be
capable of evaluating the merits and risks of our
investment in the Certificate, and we and any
accounts for which we are acting are each able to
bear the economic risk of our or its investment for
an indefinite period of time. We are acquiring the
Certificate for investment and not with a view to, or
for offer and sale in connection with, a public
distribution.
C-2
<PAGE>
[ ] (b) We are a "qualified institutional buyer" as
defined under Rule 144A under the Securities Act and
are acquiring the Certificate for our own account
(and not for the account of others) or as a fiduciary
or agent for others (which others also are "qualified
institutional buyers"). We are familiar with Rule
144A under the Securities Act and are aware that the
transferor of the Certificate and other parties
intend to rely on the statements made herein and the
exemption from the registration requirements of the
Securities Act provided by Rule 144A.
3. You are entitled to rely upon this letter and you 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,
________________________________
(Name of Purchaser)
By:_____________________________
Date:___________________________
C-3
