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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event
Reported): September 29, 1999
SSB VEHICLE SECURITIES INC., (as depositor under the
Sale and Servicing Agreement, dated as of September 1, 1999)
SSB VEHICLE SECURITIES INC.
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(Exact name of registrant as specified in its charter)
Delaware 333-63005-01 N/A
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(State or Other Jurisdiction of (Commission (I.R.S. Employer)
Incorporation) File Number) Identification No.
Seven World Trade Center
New York, New York 10048
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(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code (212) 783-7000
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<PAGE>
Item 5. Other Events.
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Filing of certain Agreements
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On September 29, 1999, SSB Vehicle Securities Inc. ("SSB") entered into a
sale and servicing agreement dated as of September 1, 1999 (the "Sale and
Servicing Agreement"), by and among SSB, as depositor, BMW Vehicle Owner Trust
1999-A (the "Issuer"), as issuer, BMW Financial Services NA, Inc., as a seller
and servicer, BMW FS Funding Corporation, as a seller, and The Chase Manhattan
Bank ("Chase") as indenture trustee. The Sale and Servicing Agreement is
attached hereto as Exhibit 10.1.
On September 29, 1999, the Issuer and Chase entered into an indenture
dated as of September 1, 1999 (the "Indenture"). On September 29, 1999, SSB
and Wilmington Trust Company entered into an amended and restated trust
agreement (the "Trust Agreement"). The Indenture is attached hereto as Exhibit
4.1 and the Trust Agreement is attached hereto as Exhibit 4.2.
Item 7. Financial Statements and Exhibits.
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Information and Exhibits.
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(a) Financial Statements of businesses acquired.
Not applicable.
(b) Pro Forma financial information.
Not applicable.
(c) Exhibit No. Description
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4.1 Indenture
4.2 Trust Agreement
10.1 Sale and Servicing Agreement
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SSB VEHICLE SECURITIES INC.
By:/s/ Ted Yarbrough
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Name: Ted Yarbrough
Title: Assistant Vice President
Dated: October 15, 1999
<PAGE>
Exhibit Index
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Exhibit Page
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4.1 Indenture.............................................................
4.2 Trust Agreement.......................................................
10.1 Sale and Servicing Agreement..........................................
Exhibit 4.1
EXECUTION
INDENTURE
between
BMW VEHICLE OWNER TRUST 1999-A,
as Issuer
and
THE CHASE MANHATTAN BANK,
as Indenture Trustee
Dated as of September 1, 1999
TABLE OF CONTENTS
PAGE
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions........................................2
Section 1.02. Rules of Construction..............................8
Section 1.03. Incorporation by Reference of Trust Indenture Act..8
ARTICLE II.
THE NOTES
Section 2.01. Form..............................................10
Section 2.02. Execution, Authentication and Delivery............10
Section 2.03. Temporary Notes...................................11
Section 2.04. Registration; Registration of Transfer
` and Exchange......................................11
Section 2.05. [Reserved]........................................12
Section 2.06. Mutilated, Destroyed, Lost or Stolen Notes........12
Section 2.07. Persons Deemed Owners.............................13
Section 2.08. Payment of Principal and Interest; Defaulted
Interest..........................................13
Section 2.09. Cancellation......................................14
Section 2.10. Book-Entry Notes..................................14
Section 2.11. Notices to Clearing Agency........................15
Section 2.12. Definitive Notes..................................15
Section 2.13. Tax Treatment.....................................16
ARTICLE III.
COVENANTS
Section 3.01. Payment of Principal and Interest.................17
Section 3.02. Maintenance of Office or Agency...................17
Section 3.03. Money for Payments To Be Held in Trust............17
Section 3.04. Existence.........................................19
Section 3.05. Protection of Trust Estate........................19
Section 3.06. Opinions as to Trust Estate.......................19
Section 3.07. Performance of Obligations; Servicing of
Receivables.......................................20
Section 3.08. Negative Covenants................................21
Section 3.09. Annual Statement as to Compliance.................22
Section 3.10. Issuer May Consolidate, etc.......................22
Section 3.11. Successor or Transferee...........................23
Section 3.12. No Other Business.................................24
Section 3.13. No Borrowing......................................24
Section 3.14. Servicer's Obligations............................24
Section 3.15. Guarantees, Loans, Advances and Other Liabilities.24
Section 3.16. Capital Expenditures..............................24
Section 3.17. Removal of Administrator..........................24
Section 3.18. Restricted Payments...............................24
Section 3.19. Notice of Events of Default.......................25
Section 3.20. Further Instruments and Acts......................25
ARTICLE IV.
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture...........26
Section 4.02. Application of Trust Money........................27
Section 4.03. Repayment of Moneys Held by Paying Agent..........27
Section 4.04. Release of Collateral.............................27
ARTICLE V.
REMEDIES
Section 5.01. Events of Default.................................28
Section 5.02. Acceleration of Maturity; Rescission and
Annulment.........................................29
Section 5.03. Collection of Indebtedness and Suits for
Enforcement by Indenture Trustee; Authority
of the Controlling Party..........................30
Section 5.04. Remedies; Priorities..............................32
Section 5.05. Optional Preservation of the Receivables..........34
Section 5.06. Limitation of Suits...............................34
Section 5.07. Unconditional Rights of Noteholders To
Receive Principal and Interest....................35
Section 5.08. Restoration of Rights and Remedies................35
Section 5.09. Rights and Remedies Cumulative....................35
Section 5.10. Delay or Omission Not a Waiver....................35
Section 5.11. Control by Noteholders............................35
Section 5.12. Waiver of Past Defaults...........................36
Section 5.13. Undertaking for Costs.............................36
Section 5.14. Waiver of Stay or Extension Laws..................37
Section 5.15. Action on Notes...................................37
Section 5.16. Performance and Enforcement of Certain
Obligations.......................................37
ARTICLE VI.
THE INDENTURE TRUSTEE
Section 6.01. Duties of Indenture Trustee.......................39
Section 6.02. Rights of Indenture Trustee.......................40
Section 6.03. Individual Rights of Indenture Trustee............41
Section 6.04. Indenture Trustee's Disclaimer....................42
Section 6.05. Notice of Defaults................................42
Section 6.06. Reports by Indenture Trustee to Holders...........42
Section 6.07. Compensation and Indemnity........................42
Section 6.08. Replacement of Indenture Trustee..................43
Section 6.09. Successor Indenture Trustee by Merger.............43
Section 6.10. Appointment of Co-Indenture Trustee or
Separate Indenture Trustee........................44
Section 6.11. Eligibility; Disqualification.....................45
Section 6.12. [Reserved]........................................45
Section 6.13. Preferential Collection of Claims Against Issuer..45
Section 6.14. Waiver of Setoffs.................................45
ARTICLE VII.
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. Issuer To Furnish Indenture Trustee Names
and Addresses of Noteholders......................46
Section 7.02. Preservation of Information; Communications
to Noteholders....................................46
Section 7.03. Reports by Issuer.................................46
Section 7.04. Reports by Indenture Trustee......................47
ARTICLE VIII.
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money...............................48
Section 8.02. Trust Accounts....................................48
Section 8.03. General Provisions Regarding Accounts.............49
Section 8.04. Release of Trust Estate...........................49
Section 8.05. Opinion of Counsel................................50
ARTICLE IX.
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent
of Noteholders....................................51
Section 9.02. Supplemental Indentures with Consent
of Noteholders....................................52
Section 9.03. Execution of Supplemental Indentures..............53
Section 9.04. Effect of Supplemental Indenture..................53
Section 9.05. Reference in Notes to Supplemental Indentures.....54
Section 9.06. Conformity with Trust Indenture Act...............54
ARTICLE X.
REDEMPTION OF NOTES
Section 10.01. Redemption........................................55
Section 10.02. Form of Redemption Notice.........................55
Section 10.03. Notes Payable on Redemption Date..................55
ARTICLE XI.
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions, etc.........56
Section 11.02. Form of Documents Delivered to Indenture Trustee..57
Section 11.03. Acts of Noteholders...............................58
Section 11.04. Notices, etc., to Indenture Trustee, Issuer
and Rating Agencies...............................58
Section 11.05. Notices to Noteholders; Waiver....................59
Section 11.06. Alternate Payment and Notice Provisions...........60
Section 11.07. Effect of Headings and Table of Contents..........60
Section 11.08. Successors and Assigns............................60
Section 11.09. Separability......................................60
Section 11.10. Benefits of Indenture.............................60
Section 11.11. Legal Holidays....................................60
Section 11.12. GOVERNING LAW.....................................60
Section 11.13. Counterparts......................................60
Section 11.14. Recording of Indenture............................61
Section 11.15. Trust Obligation..................................61
Section 11.16. No Petition.......................................61
Section 11.17. Inspection........................................61
Section 11.18. Conflict with Trust Indenture Act.................62
Section 11.19. Limitation of Liability...........................62
SCHEDULE A Schedule of Receivables
EXHIBIT A-1 Form of Class A-1 Note
EXHIBIT A-2 Form of Class A-2 Note
EXHIBIT A-3 Form of Class A-3 Note
EXHIBIT A-4 Form of Class A-4 Note
EXHIBIT B Form of the Note Depository Agreement
THIS INDENTURE, dated as of September 1, 1999, is between BMW VEHICLE
OWNER TRUST 1999-A, a Delaware business trust (the "Issuer"), and THE CHASE
MANHATTAN BANK, a New York banking corporation, as trustee and not in its
individual capacity (the "Indenture Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Issuer's 5.64% Asset
Backed Notes, Class A-1 (the "Class A-1 Notes"), 6.16% Asset Backed Notes,
Class A-2 (the "Class A-2 Notes"), 6.41% Asset Backed Notes, Class A-3 (the
"Class A-3 Notes") and 6.54% Asset Backed Notes, Class A-4 (the "Class A-4
Notes" and, together with the Class A-1 Notes, Class A-2 Notes and Class A-3
Notes, the "Notes"):
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the Closing
Date, as Indenture Trustee for the benefit of the Holders of the Notes, all of
the Issuer's right, title and interest in and to (a) the Receivables listed on
Schedule A and all moneys received thereon on or after September 1, 1999, (b)
the security interests in the Financed Vehicles and any accessions thereto
granted by Obligors pursuant to the Receivables and any other interest of the
Issuer in such Financed Vehicles; (c) any Liquidation Proceeds and any other
proceeds with respect to the Receivables from claims on any physical damage,
credit life or disability insurance policies covering Financed Vehicles or
Obligors, including any vendor's single interest or other collateral
protection insurance policy; (d) any property that shall have secured a
Receivable and that shall have been acquired by or on behalf of the Sellers,
the Servicer, or the Issuer; (e) all documents and other items contained in
the Receivable Files; (f) all funds on deposit from time to time in the Trust
Accounts and in all investments and proceeds thereof (including all income
thereon); (g) the Issuer's rights and benefits, but none of its obligations,
under the Sale and Servicing Agreement (including the Issuer's right to cause
the Sellers, or the Servicer, as the case may be, to repurchase Receivables
from the Issuer under the circumstances described therein); (h) the Issuer's
rights and benefits under the Receivables Purchase Agreement, including the
representations and warranties and the cure and repurchase obligations of the
Sellers under the Receivables Purchase Agreement; (i) all right, title and
interest in all funds on deposit from time to time in the Trust Accounts and
all investments and proceeds thereof (including all investment earnings
therein); and (j) all present and future claims, demands, causes of action and
choses in action in respect of any or all of the foregoing and all payments on
or under and all proceeds of every kind and nature whatsoever in respect of
any or all of the foregoing, including all proceeds of the conversion thereof,
voluntary or involuntary, into cash or other liquid property, all cash
proceeds, accounts, accounts receivable, notes, drafts, acceptances, chattel
paper, checks, deposit accounts, insurance proceeds, condemnation awards,
rights to payment of any and every kind and other forms of obligations and
receivables, instruments and other property that at any time constitute all or
part of or are included in the proceeds of any of the foregoing (collectively,
the "Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice, priority or distinction, and to
secure compliance with the provisions of this Indenture, all as provided in
this Indenture.
The Indenture Trustee, on behalf of the Holders of the Notes,
acknowledges such Grant, accepts the trusts under this Indenture in accordance
with the provisions of this Indenture and agrees to perform its duties
required in this Indenture to the best of its ability to the end that the
interests of the Holders of the Notes may be adequately and effectively
protected.
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
(a) Definitions. Except as otherwise specified herein or as the
context may otherwise require, the following terms have the respective
meanings set forth below for all purposes of this Indenture.
"Act" has the meaning specified in Section 11.03(a).
"Administration Agreement" means the Owner Trust Administration
Agreement, dated as of September 29, 1999, among the Administrator, the Issuer
and the Indenture Trustee.
"Administrator" means BMW FS, or any successor Administrator under
the Administration Agreement.
"Affiliate" means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used
with respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling"
and "controlled" have meanings correlative to the foregoing.
"Authorized Officer" means, with respect to the Issuer, any officer
of the Owner Trustee who is authorized to act for the Owner Trustee in matters
relating to the Issuer and who is identified on the list of Authorized
Officers delivered by the Owner Trustee to the Indenture Trustee on the
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 Closing Date (as such list may be modified or
supplemented from time to time thereafter).
"BMW FS" means BMW Financial Services NA, Inc., a Delaware
corporation, and its successors.
"BMW Funding" means BMW FS Funding Corporation, a Delaware
corporation, and its successors.
"Book-Entry Notes" means a beneficial interest in the Notes,
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.10.
"Business Day" shall have the meaning assigned thereto in the Sale
and Servicing Agreement.
"Certificate of Trust" means the certificate of trust of the Issuer
substantially in the form of Exhibit A to the Trust Agreement.
"Class A-1 Notes" means the 5.64% Asset Backed Notes, Class A-1,
substantially in the form of Exhibit A-1.
"Class A-1 Rate" means 5.64% per annum, computed on the basis of a
360-day year consisting of twelve 30-day months.
"Class A-2 Notes" means the 6.16% Asset Backed Notes, Class A-2,
substantially in the form of Exhibit A-2.
"Class A-2 Rate" means a 6.16% per annum computed on the basis of a
360-day year consisting of twelve 30-day months.
"Class A-3 Notes" means the 6.41% Asset Backed Notes, Class A-3,
substantially in the form of Exhibit A-3.
"Class A-3 Rate" means 6.41% per annum, computed on the basis of a
360-day year consisting of twelve 30-day months.
"Class A-4 Notes" means the 6.54% Asset Backed Notes, Class A-4,
substantially in the form of Exhibit A-4.
"Class A-4 Rate" means 6.54% per annum, computed on the basis of a
360-day year consisting of twelve 30-day months.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with
the Clearing Agency.
"Closing Date" means September 29, 1999.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, and Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of this
Indenture.
"Controlling Party" means (i) if the Notes have not been paid in
full, the Indenture Trustee acting at the direction of at least a majority in
Outstanding Amount of the Noteholders and (ii) if the Notes have been paid in
full, the Owner Trustee for the benefit of the Certificateholders.
"Corporate Trust Office" means the principal office of the Indenture
Trustee at which at any particular time its corporate trust business is
administered, which office at the date of execution of this Agreement is
located at The Chase Manhattan Bank, 450 West 33rd Street, 14th Floor, New
York, New York 10001 (facsimile number (212) 946-3916); Attention: Capital
Markets Fiduciary Services/BMW Vehicle Owner Trust 1999-A, or at such other
address as the Indenture Trustee may designate from time to time by notice to
the Noteholders and the Issuer, or the principal corporate trust office of any
successor Indenture Trustee at the address designated by such successor
Indenture Trustee by notice to the Noteholders and the Issuer.
"Default" means any occurrence that is, or with notice or the lapse
of time or both would become, an Event of Default.
"Definitive Notes" has the meaning specified in Section 2.10.
"Event of Default" has the meaning specified in Section 5.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Executive Officer" means, with respect to any corporation, the Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, any Executive Vice President, any Senior Vice President, any Vice
President, the Secretary, the Controller or the Treasurer of such corporation;
and with respect to any partnership, any general partner thereof.
"Grant" means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, and grant a lien upon and a
security interest in and a right of set-off against, deposit, set over and
confirm pursuant to this Indenture. A Grant of the Collateral or of any other
agreement or instrument shall include all rights, powers and options (but none
of the obligations) of the granting party thereunder, including the immediate
and continuing right to claim for, collect, receive and give receipt for
principal and interest payments in respect of the Collateral and all other
moneys payable thereunder, to give and receive notices and other
communications, to make waivers or other agreements, to exercise all rights
and options, to bring Proceedings in the name of the granting party or
otherwise, and generally to do and receive anything that the granting party is
or may be entitled to do or receive thereunder or with respect thereto.
"Holder" or "Noteholder" means a Person in whose name a Note is
registered on the Note Register.
"Indenture Trustee" means The Chase Manhattan Bank, a New York
banking corporation, not in its individual capacity, but as Indenture Trustee
under this Indenture, or any successor Indenture Trustee under this Indenture.
"Independent" means, when used with respect to any specified Person,
that such Person (a) is in fact independent of the Issuer, any other obligor
on the Notes, the Sellers 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 Sellers or any
Affiliate of any of the foregoing Persons and (c) is not connected with the
Issuer, any such other obligor, the Seller or any Affiliate of any of the
foregoing Persons as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions.
"Independent Certificate" means a certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01, made
by an Independent appraiser or other expert appointed by an Issuer Order and
approved by the Indenture Trustee in the exercise of reasonable care, and such
opinion or certificate shall state that the signer has read the definition of
"Independent" in this Indenture and that the signer is Independent within the
meaning thereof.
"Interest Rate" means the Class A-1 Rate, the Class A-2 Rate, the
Class A-3 Rate or the Class A-4 Rate, as the context may require.
"Issuer" means BMW Vehicle Owner Trust 1999-A until a successor
replaces it and, thereafter, means the successor and, for purposes of any
provision contained herein and required by the TIA, each other obligor on the
Notes.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and
delivered to the Indenture Trustee.
"Note" means a Class A-1 Note, a Class A-2 Note, a Class A-3 Note or
a Class A-4 Note, as the context may require.
"Note Depository Agreement" means the agreement dated September 28,
1999, among the Issuer, the Administrator, the Indenture Trustee and The
Depository Trust Company, as the initial Clearing Agency, relating to the
Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4
Notes, substantially in the form of Exhibit B.
"Note Owner" means, with respect to a Book-Entry Note, the Person who
is the beneficial owner of such Book-Entry Note, as reflected on the books of
the Clearing Agency or on the books of a Person maintaining an account with
such Clearing Agency (directly as a Clearing Agency Participant or as an
indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.04.
"Officer's Certificate" means a certificate signed by any Authorized
Officer of the Issuer, under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.01, and delivered to
the Indenture Trustee. Unless otherwise specified, any reference in this
Indenture to an Officer's Certificate shall be to an Officer's Certificate of
any Authorized Officer of the Issuer.
"Opinion of Counsel" means one or more written opinions of counsel
who may, except as otherwise expressly provided in this Indenture, be an
employee of or counsel to the Issuer and who shall be satisfactory to the
Indenture Trustee, and which opinion or opinions shall be addressed to the
Indenture Trustee, shall comply with any applicable requirements of Section
11.01 and shall be in form and substance satisfactory to the Indenture
Trustee.
"Outstanding" means, as of any date of determination, all Notes
theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in
the necessary amount has been theretofore deposited with the Indenture Trustee
or any Paying Agent in trust for the Holders of such Notes (provided, however,
that if such Notes are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture or provision for such notice has been made,
satisfactory to the Indenture Trustee); and
(iii) Notes in exchange for or in lieu of which other Notes 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 on 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 a Responsible Officer of
the Indenture Trustee knows to be so owned shall be so disregarded. Notes so
owned that have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Indenture Trustee the
pledgee's right so to act with respect to such Notes and that the pledgee is
not the Issuer, any other obligor on the Notes, the Seller or any Affiliate of
any of the foregoing Persons.
"Outstanding Amount" means, as of any date of determination and as to
any Notes, the aggregate principal amount of such Notes Outstanding as of such
date of determination.
"Owner Trustee" means Wilmington Trust Company, not in its individual
capacity but solely as Owner Trustee under the Trust Agreement, or any
successor Owner Trustee under the Trust Agreement.
"Paying Agent" means the Indenture Trustee or any other Person that
meets the eligibility standards for the Indenture Trustee specified in Section
6.11 and is authorized by the Issuer to make payments to and distributions
from the Collection Account, the Note Distribution Account and the Reserve
Account, including payments of principal of or interest on the Notes on behalf
of the Issuer.
"Payment Date" means a Distribution Date.
"Person" means any individual, corporation, estate, partnership,
limited liability company, joint venture, association, joint stock company,
trust or business trust (including any beneficiary thereof), unincorporated
organization or government or any agency or political subdivision thereof.
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced
by such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.06 in lieu of a mutilated, lost,
destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.
"Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.
"Record Date" means, with respect to a Distribution Date or
Redemption Date, the close of business on the day immediately preceding such
Distribution Date or Redemption Date.
"Redemption Date" means, as the context requires, in the case of a
redemption of the Notes pursuant to Section 10.01, the Distribution Date
specified by the Servicer or the Issuer pursuant to Section 10.01.
"Redemption Price" means in the case of a redemption of the Notes
pursuant to Section 10.01, an amount equal to the unpaid principal amount of
the Notes redeemed plus accrued and unpaid interest thereon at the Class A-4
Rate for each Note being so redeemed to but excluding the Redemption Date.
"Registered Holder" means the Person in whose name a Note is
registered on the Note Register on the applicable Record Date.
"Responsible Officer" means, with respect to the Indenture Trustee or
Owner Trustee, as applicable, any officer within the Corporate Trust Office of
the Indenture Trustee or the Owner Trustee, including any Vice President,
Assistant Vice President, Assistant Treasurer, Assistant Secretary or any
other officer of the Indenture Trustee or the Owner 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, in each case having direct
responsibility for the administration of the Basic Documents.
"Sale and Servicing Agreement" means the Sale and Servicing
Agreement, dated as of September 1, 1999, among the Issuer, the Depositor, BMW
FS, as Seller, Servicer, Custodian and Administrator, BMW Funding, as Seller,
and the Indenture Trustee.
"Schedule of Receivables" means the list of Receivables set forth in
Schedule A (which Schedule may be in the form of microfiche).
"Securities Act" means the Securities Act of 1933, as amended.
"Sellers" means BMW FS and BMW Funding, each in its respective
capacity as seller under the Receivables Purchase Agreement and the Sale and
Servicing Agreement, and their respective successors in interest.
"Servicer" means BMW FS, in its capacity as servicer under the Sale
and Servicing Agreement, and any Successor Servicer thereunder.
"State" means any one of the 50 states of the United States of
America, or the District of Columbia.
"Successor Servicer" has the meaning specified in Section 3.07(f).
"Trust Estate" means all money, instruments, rights and other
property that are subject or intended to be subject to the lien and security
interest of this Indenture for the benefit of the Noteholders (including,
without limitation, all property and interests Granted to the Indenture
Trustee), including all proceeds thereof.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939
as in force on the date hereof, unless otherwise specifically provided.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code as in effect in the relevant jurisdiction, as amended from
time to time.
(b) Except as otherwise specified herein or as the context may otherwise
require, capitalized terms used herein but not otherwise defined shall have
the meanings ascribed thereto in the Sale and Servicing Agreement.
Section 1.02. Rules of Construction. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles as
in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
(v) definitions are applicable to the singular and plural forms
of such terms and to the masculine, feminine and neuter genders of such terms;
and
(vi) any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein; references to a Person are also to its permitted
successors and assigns.
Section 1.03. Incorporation by Reference of Trust Indenture Act. Whenever
this Indenture refers to a provision of the 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 security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture
Trustee.
"obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
have the meaning assigned to them by such definitions.
ARTICLE II.
THE NOTES
Section 2.01. Form. The Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes and the Class A-4 Notes, in each case together with the Indenture
Trustee's certificate of authentication, shall be in substantially the form
set forth in Exhibit A-1, Exhibit A-2, Exhibit A-3 and Exhibit A-4,
respectively, with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by
the officers executing the Notes, as evidenced by their execution of the
Notes. Any portion of the text of any Note may be set forth on the reverse
thereof, with an appropriate reference thereto on the face of such Note.
The Definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without
steel engraved borders), all as determined by the officers executing such
Notes, as evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication. The terms of
the Notes set forth in Exhibit A-1, Exhibit A-2, Exhibit A-3 and Exhibit A-4
are part of the terms of this Indenture.
Section 2.02. Execution, Authentication and Delivery. The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals who
were at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
The Indenture Trustee shall upon Issuer Order authenticate and
deliver Class A-1 Notes for original issue in an aggregate principal amount of
$190,000,000, Class A-2 Notes for original issue in an aggregate principal
amount of $400,000,000, Class A-3 Notes for original issue in an aggregate
principal amount of $300,000,000 and Class A-4 Notes for original issue in an
aggregate principal amount of $171,600,000. The aggregate principal amount of
Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4 Notes
outstanding at any time may not exceed such respective amounts except as
provided in Section 2.06.
The Notes shall be issuable as registered Notes in minimum
denominations of $1,000 and in integral multiples of $1,000 in excess thereof.
No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Note shall be conclusive
evidence, and the only evidence, that such Note has been duly authenticated
and delivered hereunder.
Section 2.03. Temporary Notes. Pending the preparation of Definitive
Notes, the Issuer may execute, and upon receipt of an Issuer Order the
Indenture Trustee shall authenticate and deliver, temporary Notes that are
printed, lithographed, typewritten, mimeographed or otherwise produced, of the
tenor of the Definitive Notes in lieu of which they are issued and with such
variations not inconsistent with the terms of this Indenture as the officers
executing such Notes may determine, as evidenced by their execution of such
Notes.
If temporary Notes are issued, the Issuer shall cause Definitive
Notes to be prepared without unreasonable delay. After the preparation of
Definitive Notes, the temporary Notes shall be exchangeable for Definitive
Notes upon surrender of the temporary Notes at the office or agency of the
Issuer to be maintained as provided in Section 3.02, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Notes,
the Issuer shall execute, and the Indenture Trustee shall authenticate and
deliver in exchange therefor, a like principal amount of Definitive Notes of
authorized denominations. Until so exchanged, the temporary Notes shall in all
respects be entitled to the same benefits under this Indenture as Definitive
Notes.
Section 2.04. Registration; Registration of Transfer and Exchange. The
Issuer shall cause to be kept a register (the "Note Register") in which,
subject to such reasonable regulations as it may prescribe, the Note Registrar
shall provide for the registration of Notes and the registration of transfers
of Notes. The Indenture Trustee initially shall be the "Note Registrar" for
the purpose of registering Notes and transfers of Notes as herein provided.
Upon any resignation of any Note Registrar, the Issuer shall promptly appoint
a successor or, if it elects not to make such an appointment, assume the
duties of Note Registrar.
If a Person other than the Indenture Trustee is appointed by the
Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture
Trustee shall have the right to inspect the Note Register at all reasonable
times and to obtain copies thereof, and the Indenture Trustee shall have the
right to conclusively rely upon a certificate executed on behalf of the Note
Registrar by an Executive Officer thereof as to the names and addresses of the
Holders of the Notes and the principal amounts and number of such Notes.
Upon surrender for registration of transfer of any Note at the office
or agency of the Issuer to be maintained as provided in Section 3.02, if the
requirements of Section 8-401(1) of the UCC are met, the Issuer shall execute,
and the Indenture Trustee shall authenticate and the Noteholder shall obtain
from the Indenture Trustee, in the name of the designated transferee or
transferees, one or more new Notes of the same Class in any authorized
denominations, of a like aggregate principal amount.
At the option of the Holder, Notes may be exchanged for other Notes
of the same Class in any authorized denominations, of a like aggregate
principal amount, upon surrender of the Notes to be exchanged at such office
or agency. Whenever any Notes are so surrendered for exchange, if the
requirements of Section 8-401(1) of the UCC are met, the Issuer shall execute,
and the Indenture Trustee, without having to verify that the requirements of
8-401(1) have been met, shall authenticate and the Noteholder shall obtain
from the Indenture Trustee, the Notes that the Noteholder making the exchange
is entitled to receive.
All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes
surrendered upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed by, or be accompanied by a written instrument
of transfer in form satisfactory to the Indenture Trustee duly executed by,
the Holder thereof or such Holder's attorney duly authorized in writing, with
such signature guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in the Securities Transfer Agent's Medallion Program ("STAMP")
or such other "signature guarantee program" as may be determined by the Note
Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Exchange Act.
No service charge shall be made to a Holder for any registration of
transfer or exchange of Notes, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in connection with any registration of transfer or exchange of Notes, other
than exchanges pursuant to Section 2.03 or 9.05 not involving any transfer.
The preceding provisions of this Section notwithstanding, the Issuer
shall not be required to make and the Note Registrar need not register
transfers or exchanges of Notes selected for redemption or of any Note for a
period of 15 days preceding the due date for any payment with respect to the
Note.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the transfer
of Notes.
Section 2.05. [Reserved].
Section 2.06. Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture
Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, and (ii) there is delivered to the Indenture Trustee such
security or indemnity as may be required by it to hold the Issuer and the
Indenture Trustee harmless, then, in the absence of notice to the Issuer, the
Note Registrar or the Indenture Trustee that such Note has been acquired by a
bona fide purchaser, and provided that the requirements of Section 8-405 of
the UCC are met, the Issuer shall execute, and upon an Issuer Order the
Indenture Trustee shall authenticate and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Note, a replacement Note of
the same Class; provided, however, that if any such destroyed, lost or stolen
Note, but not a mutilated Note, shall have become or within 15 days shall be
due and payable, or shall have been called for redemption, instead of issuing
a replacement Note, the Issuer may pay such destroyed, lost or stolen Note
when so due or payable or upon the Redemption Date without surrender thereof.
If, after the delivery of such replacement Note or payment of a destroyed,
lost or stolen Note, a bona fide purchaser of the original Note in lieu of
which such replacement Note was issued presents for payment such original
Note, the Issuer and the Indenture Trustee shall be entitled to recover such
replacement Note (or such payment) from the Person to whom it was delivered or
any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Issuer or the Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the
Issuer may require the payment by the Holder of such Note of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this Section in replacement
of any mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuer, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Notes.
Section 2.07. Persons Deemed Owners. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and
any agent of the Issuer or the Indenture Trustee may treat the Person in whose
name any Note is registered (as of the day of determination) as the owner of
such Note for the purpose of receiving payments of principal of and interest,
if any, on such Note and for all other purposes whatsoever, whether or not
such Note be overdue, and none of the Issuer, the Indenture Trustee or any
agent of the Issuer or the Indenture Trustee shall be affected by notice to
the contrary.
Section 2.08. Payment of Principal and Interest; Defaulted Interest.
(a) The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class A-4 Notes shall accrue interest at the Class A-1 Rate, the Class A-2
Rate, the Class A-3 Rate and the Class A-4 Rate, respectively, as set forth in
Exhibit A-1, Exhibit A-2, Exhibit A-3 and Exhibit A-4, respectively, and such
interest shall be payable on each Distribution Date as specified therein,
subject to Section 3.01. Any installment of interest or principal payable on a
Note that is punctually paid or duly provided for by the Issuer on the
applicable Distribution Date shall be paid to the Person in whose name such
Note (or one or more Predecessor Notes) is registered on the Record Date by
check mailed first-class postage prepaid to such Person's address as it
appears on the Note Register on such Record Date, except that, unless
Definitive Notes have been issued pursuant to Section 2.12, with respect to
Notes registered on the Record Date in the name of the nominee of the Clearing
Agency (initially, such nominee to be Cede & Co.), payment shall be made by
wire transfer in immediately available funds to the account designated by such
nominee; provided, however, that the final installment of principal payable
with respect to such Note on a Distribution Date or on the related Final
Scheduled Distribution Date (including the Redemption Price for any Note
called for redemption pursuant to Section 10.01) shall be payable as provided
in paragraph (b) below. The funds represented by any such checks returned
undelivered shall be held in accordance with Section 3.03.
(b) The principal of each Note shall be payable in installments on
each Distribution Date as provided in Section 3.01 hereof and the forms of the
Notes set forth in Exhibit A-1, Exhibit A-2, Exhibit A-3 and Exhibit A-4.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
may be declared immediately due and payable, if not previously paid, in the
manner provided in Section 5.02 on any date on which an Event of Default shall
have occurred and be continuing by the Indenture Trustee or the Indenture
Trustee acting at the direction of the Holders of Notes representing not less
than a majority of the Outstanding Amount. All principal payments on each
Class of Notes shall be made pro rata to the Noteholders of each Class
entitled thereto. Upon written notice thereof, the Indenture Trustee shall
notify the Person in whose name a Note is registered at the close of business
on the Record Date preceding the Distribution Date on which the Issuer expects
the final installment of principal of and interest on such Note to be paid.
Such notice shall specify that such final installment will be payable only
upon presentation and surrender of such Note and shall specify the place where
such Note may be presented and surrendered for payment of such installment.
Notices in connection with redemptions of Notes shall be mailed to Noteholders
as provided in Section 10.02.
(c) If the Issuer defaults in a payment of interest on the Notes, the
Issuer shall pay defaulted interest (plus interest on such defaulted interest
to the extent lawful) at the applicable Interest Rate in any lawful manner on
the next Distribution Date.
Section 2.09. Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee. The Issuer may at
any time deliver to the Indenture Trustee for cancellation any Notes
previously authenticated and delivered hereunder that the Issuer may have
acquired in any manner whatsoever, and all Notes so delivered shall be
promptly cancelled by the Indenture Trustee. No Notes shall be authenticated
in lieu of or in exchange for any Notes cancelled as provided in this Section,
except as expressly permitted by this Indenture. All cancelled Notes may be
held or disposed of by the Indenture Trustee in accordance with its standard
retention or disposal policy as in effect at the time unless the Issuer shall
direct by an Issuer Order that they be destroyed or returned to it; provided,
that such Issuer Order is timely and the Notes have not been previously
disposed of by the Indenture Trustee.
Section 2.10. Book-Entry Notes. The Notes, upon original issuance, will
be issued in the form of typewritten Notes representing the Book-Entry Notes,
to be delivered to The Depository Trust Company, the initial Clearing Agency,
by, or on behalf of, the Issuer. The Book-Entry Notes shall be registered
initially on the Note Register in the name of Cede & Co., the nominee of the
initial Clearing Agency, and no Owner thereof will receive a Definitive Note
representing such Note Owner's interest in such Note, except as provided in
Section 2.12. Unless and until definitive, fully registered Notes (the
"Definitive Notes") have been issued to such Note Owners pursuant to Section
2.12:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Note Registrar and the Indenture Trustee shall be
entitled to deal with the Clearing Agency for all purposes of this Indenture
(including the payment of principal of and interest on the Notes and the
giving of instructions or directions hereunder) as the sole holder of the
Notes, and shall have no obligation to the Note Owners;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Indenture, the provisions of this Section
shall control;
(iv) the rights of Note Owners shall be exercised only through
the Clearing Agency and shall be limited to those established by law and
agreements between such Note Owners and the Clearing Agency or the Clearing
Agency Participants pursuant to the Note Depository Agreement. Unless and
until Definitive Notes are issued pursuant to Section 2.12, the initial
Clearing Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit payments of principal of and interest on
the Notes to such Clearing Agency Participants; and
(v) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes evidencing a
specified percentage of the Outstanding Amount of the Notes, the Clearing
Agency shall be deemed to represent such percentage only to the extent that it
has received instructions to such effect from Note Owners or Clearing Agency
Participants owning or representing, respectively, such required percentage of
the beneficial interest in the Notes and has delivered such instructions to
the Indenture Trustee.
Section 2.11. Notices to Clearing Agency. Whenever a notice or other
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to such Note Owners pursuant to
Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Holders of the Notes to the
Clearing Agency, and shall have no obligation to such Note Owners.
Section 2.12. Definitive Notes. If (i) the 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 the Book-Entry
Notes and the Administrator is unable to locate a qualified successor or (ii)
after the occurrence of an Event of Default or a Servicer Termination Event,
Owners of the Book-Entry Notes representing beneficial interests aggregating
at least a majority of the Outstanding Amount of such Notes advise the
Clearing Agency in writing that the continuation of a book-entry system
through the Clearing Agency is no longer in the best interests of such Note
Owners, then the Clearing Agency shall notify all Note Owners, the
Administrator and the Indenture Trustee of the occurrence of any such event
and of the availability of Definitive Notes to Note Owners requesting the
same. Upon surrender to the Indenture Trustee of the typewritten Notes
representing the Book-Entry Notes by the Clearing Agency, accompanied by
registration instructions, the Issuer shall execute and the Indenture Trustee
upon an Issuer Order shall authenticate the Definitive Notes in accordance
with the written instructions of the Clearing Agency. None of the Issuer, the
Note Registrar, the Administrator or the Indenture Trustee shall be liable for
any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Notes, the Indenture Trustee shall recognize the Holders of the
Definitive Notes as Noteholders.
Section 2.13. Tax Treatment. The Issuer has entered into this Indenture,
and the Notes will be issued, with the intention that, for federal, state and
local income, single business and franchise tax purposes, the Notes will
qualify as indebtedness of the Issuer secured by the Trust Estate. The Issuer,
by entering into this Indenture, and each Noteholder, by its acceptance of a
Note (and each Note Owner by its acceptance of an interest in the applicable
Book-Entry Note), agree to treat the Notes for federal, state and local income
and franchise tax purposes as indebtedness.
ARTICLE III.
COVENANTS
Section 3.01. Payment of Principal and Interest. The Issuer will duly and
punctually pay the principal of and interest, if any, on the Notes in
accordance with the terms of the Notes and this Indenture. Without limiting
the foregoing, subject to Section 8.02(c), on each Distribution Date, the
Issuer will cause to be distributed all amounts deposited pursuant to the Sale
and Servicing Agreement into the Note Distribution Account (i) for the benefit
of the Class A-1 Notes, to the Class A-1 Noteholders, (ii) for the benefit of
the Class A-2 Notes, to the Class A-2 Noteholders, (iii) for the benefit of
the Class A-3 Notes, to the Class A-3 Noteholders and (iv) for the benefit of
the Class A-4 Notes, to the Class A-4 Noteholders. Amounts properly withheld
under the Code by any Person from a payment to any Noteholder of interest
and/or principal shall be considered as having been paid by the Issuer to such
Noteholder for all purposes of this Indenture.
Section 3.02. Maintenance of Office or Agency. The Issuer will maintain
in the Borough of Manhattan, The City of New York, an office or agency where
Notes may be surrendered for registration of transfer or exchange, and where
notices and demands to or upon the Issuer in respect of the Notes and this
Indenture may be served. Such office will initially be located at 450 West
33rd Street, 14th floor, Attention: Capital Markets Fiduciary Services, New
York, New York 10001. The Issuer will give prompt written notice to the
Indenture Trustee of the location, and of any change in the location, of any
such office or agency. If at any time the Issuer shall fail to maintain any
such office or agency or shall fail to furnish the Indenture Trustee with the
address thereof, such surrenders, notices and demands may be made or served at
the Corporate Trust Office, and the Issuer hereby appoints the Indenture
Trustee as its agent to receive all such surrenders, notices and demands.
Section 3.03. Money for Payments To Be Held in Trust. All payments of
amounts due and payable with respect to any Notes that are to be made from
amounts withdrawn from the Collection Account, the Note Distribution Account
and the Reserve 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, the Note Distribution Account or the Reserve Account for
payments of Notes shall be paid over to the Issuer except as provided in this
Section.
On or before the Business Day preceding each Distribution Date and
Redemption Date, the Issuer shall deposit or cause to be deposited in the Note
Distribution Account an aggregate sum sufficient to pay the amounts then
becoming due under the Notes, such sum to be held in trust for the benefit of
the Persons entitled thereto, and (unless the Paying Agent is the Indenture
Trustee) shall promptly notify the Indenture Trustee of its action or failure
so to act.
The Issuer will cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee an instrument in which
such Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions
of this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise disposed of as
herein provided and pay such sums to such Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by the
Issuer (or any other obligor on 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 at the time of its appointment; and
(v) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable reporting
requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by
Issuer Order direct any Paying Agent to pay to the Indenture Trustee all sums
held in trust by such Paying Agent, such sums to be held by the Indenture
Trustee upon the same trusts as those upon which the sums were held by such
Paying Agent; and upon such payment by any Paying Agent to the Indenture
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Subject to applicable laws with respect to escheat of funds, any
money held by the Indenture Trustee or any Paying Agent in trust for the
payment of any amount due with respect to any Note and remaining unclaimed for
two years after such amount has become due and payable shall be discharged
from such trust and be paid upon Issuer Request to the Issuer; and the Holder
of such Note shall thereafter, as an unsecured general creditor, look only to
the Issuer for payment thereof (but only to the extent of the amounts so paid
to the Issuer), and all liability of the Indenture Trustee or such Paying
Agent with respect to such trust money shall thereupon cease; provided,
however, that the Indenture Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense and direction of the
Issuer cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general
circulation in The City of New York, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication, any unclaimed balance of such money then
remaining will be repaid to the Issuer. The Indenture Trustee shall also adopt
and employ, at the expense and direction of the Issuer, any other reasonable
means of notification of such repayment (including, but not limited to,
mailing notice of such repayment to Holders whose Notes have been called but
have not been surrendered for redemption or whose right to or interest in
moneys due and payable but not claimed is determinable from the records of the
Indenture Trustee or of any Paying Agent, at the last address of record for
each such Holder).
Section 3.04. Existence. The Issuer will 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 will keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and will
obtain and preserve its qualification to do business in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Trust Estate.
Section 3.05. Protection of Trust Estate. The Issuer will from time
to time execute and deliver all such supplements and amendments hereto and all
such financing statements, continuation statements, instruments of further
assurance and other instruments, and will take such other action necessary or
advisable to:
(i) maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the purposes
hereof;
(ii) perfect, publish notice of or protect the validity of any
Grant made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
(iv) preserve and defend title to the Trust Estate and the
rights of the Indenture Trustee and the Noteholders in such Trust Estate
against the claims of all persons and parties.
The Issuer hereby designates the Indenture Trustee, as its agent and
attorney-in-fact, to execute upon an Issuer Order any financing statement,
continuation statement or other instrument required to be executed pursuant to
this Section 3.05.
Section 3.06. Opinions as to Trust Estate.
(a) On the Closing Date, the Issuer shall cause to be furnished 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 in 2000,
the Issuer shall furnish to the Indenture Trustee and the Rating Agencies an
Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording, filing, re-recording and
refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as is necessary to maintain
the lien and security interest created by this Indenture and reciting the
details of such action, or stating that in the opinion of such counsel no such
action is necessary to maintain such lien and security interest. Such Opinion
of Counsel shall also describe the recording, filing, re-recording and
refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and the execution and filing of any financing statements
and continuation statements that will, in the opinion of such counsel, be
required to maintain the lien and security interest of this Indenture until
April 30 in the following calendar year.
Section 3.07. Performance of Obligations; Servicing of Receivables.
(a) The Issuer will not take any action and will use its reasonable
best efforts not to permit any action to be taken by others that would release
any Person from any of such Person's material covenants or obligations under
any instrument or agreement included in the Trust Estate or that would result
in the amendment, hypothecation, subordination, termination or discharge of,
or impair the validity or effectiveness of, any such instrument or agreement,
except as expressly provided in this Indenture, the Sale and Servicing
Agreement or such other instrument or agreement.
(b) The Issuer may contract with other Persons acceptable to the
Controlling Party and with notification to the Rating Agencies to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer's Certificate of
the Issuer shall be deemed to be action taken by the Issuer. Initially, the
Issuer has contracted with the Servicer and the Administrator to assist the
Issuer in performing its duties under this Indenture.
(c) The Issuer will 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 UCC financing statements
and continuation statements required to be filed by the terms of this
Indenture and the Sale and Servicing 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 either the Indenture Trustee or the Holders of at least a
majority of the Outstanding Amount of the Notes.
(d) If the Issuer shall have knowledge of the occurrence of a
Servicer Termination Event under the Sale and Servicing Agreement, the Issuer
shall promptly notify the Indenture Trustee and the Rating Agencies thereof,
and shall specify in such notice the action, if any, the Issuer is taking with
respect to such default.
(e) [Reserved]
(f) Upon any termination of the Servicer's rights and powers pursuant
to the Sale and Servicing Agreement, the Issuer shall promptly notify the
Indenture Trustee thereof. As soon as a successor servicer (a "Successor
Servicer") is appointed, the Issuer shall notify the Indenture Trustee in
writing of such appointment, specifying in such notice the name and address of
such Successor Servicer.
(g) Without limitation of the absolute nature of the assignment
granted to the Indenture Trustee under this Indenture or the rights of the
Indenture Trustee hereunder, the Issuer agrees (i) except to extent otherwise
provided in any Basic Documents, that it will not, without the prior written
consent of either the Indenture Trustee acting at the direction of the Holders
of at least a majority in Outstanding Amount of the Notes, amend, modify,
waive, supplement, terminate or surrender, or agree to any amendment,
modification, supplement, termination, waiver or surrender of, the terms of
any Collateral (except to the extent otherwise provided in the Sale and
Servicing Agreement) or the Basic Documents, or waive timely performance or
observance by the Servicer or the Seller under the Sale and Servicing
Agreement; and (ii) that any such amendment shall not (A) increase or reduce
in any manner the amount of, or accelerate or delay the timing of,
distributions that are required to be made for the benefit of the Noteholders
or (B) reduce the aforesaid percentage of the Notes that is required to
consent to any such amendment, without the consent of the Holders of all
Outstanding Notes. If the Indenture Trustee acting at the direction of such
Holders agrees to any such amendment, modification, supplement or waiver, the
Indenture Trustee agrees, promptly following a request by the Issuer to do so,
to execute and deliver, at the Issuer's own expense, such agreements,
instruments, consents and other documents as the Issuer may deem necessary or
appropriate in the circumstances.
Section 3.08. Negative Covenants. So long as any Notes are Outstanding,
the Issuer shall not:
(i) except as expressly permitted by this Indenture, the
Receivables Purchase Agreement or the Sale and Servicing Agreement, sell,
transfer, exchange or otherwise dispose of any of the properties or assets of
the Issuer, including those included in the Trust Estate, unless directed to
do so by the Controlling Party;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than amounts
properly withheld from such payments under the Code) or 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; or
(iii) (A) permit the validity or effectiveness of this Indenture
to be impaired, or permit the lien of this Indenture to be amended,
hypothecated, subordinated, terminated or discharged, or permit any Person to
be released from any covenants or obligations with respect to the Notes under
this Indenture except as may be expressly permitted hereby, (B) permit any
lien, charge, excise, claim, security interest, mortgage or other encumbrance
(other than the lien of this Indenture) to be created on or extend to or
otherwise arise upon or burden the Trust Estate or any part thereof or any
interest therein or the proceeds thereof (other than tax liens, mechanics'
liens and other liens that arise by operation of law, in each case on any of
the Financed Vehicles and arising solely as a result of an action or omission
of the related Obligor) or (C) permit the lien of this Indenture not to
constitute a valid first priority (other than with respect to any such tax,
mechanics' or other lien) security interest in the Trust Estate.
Section 3.09. Annual Statement as to Compliance. The Issuer will deliver
to the Indenture Trustee and the Rating Agencies, within 120 days after the
end of each fiscal year of the Issuer (commencing with the fiscal year 2000),
an Officer's Certificate stating, as to the Authorized Officer signing such
Officer's Certificate, that:
(i) a review of the activities of the Issuer during such year
and of its performance under this Indenture has been made under such
Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, based
on such review, the Issuer has complied with all conditions and covenants
under this Indenture throughout such year or, if there has been a default in
its compliance with any such condition or covenant, specifying each such
default known to such Authorized Officer and the nature and status thereof.
Section 3.10. Issuer May Consolidate, etc., Only on Certain Terms.
(a) The Issuer shall not consolidate or merge with or into any other
Person, unless:
(i) the Person (if other than the Issuer) formed by or surviving
such consolidation or merger shall be a Person organized and existing under
the laws of the United States of America or any State 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
punctual payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this Indenture on
the part of the Issuer to be performed or observed, all as provided herein;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel (and
shall have delivered copies thereof to the Indenture Trustee) to the effect
that such transaction will not have any material adverse federal tax
consequence to the Issuer, any Noteholder or any Certificateholder;
(v) any action that is necessary to maintain the lien and
security interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture Trustee an
Officer's Certificate and an Opinion of Counsel each stating that such
consolidation or merger and such supplemental indenture comply with this
Article III and that all conditions precedent herein provided for relating to
such transaction have been complied with (including any filing required by the
Exchange Act) in all material respects.
(b) The Issuer shall not convey or transfer any of its properties or
assets, including those included in the Trust Estate, to any Person, unless:
(i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer the conveyance or transfer of which is
hereby restricted (A) shall be a United States citizen or a Person organized
and existing under the laws of the United States of America or any State, (B)
expressly assumes, by an indenture supplemental hereto, executed and delivered
to the Indenture Trustee, in form satisfactory to the Indenture Trustee, the
due and punctual payment of the principal of and interest on all Notes and the
performance or observance of every agreement and covenant of this Indenture on
the part of the Issuer to be performed or observed, all as provided herein,
(C) expressly agrees by means of such supplemental indenture that all right,
title and interest so conveyed or transferred shall be subject and subordinate
to the rights of Holders of the Notes, (D) unless otherwise provided in such
supplemental indenture, expressly agrees to indemnify, defend and hold
harmless the Issuer and the Indenture Trustee against and from any loss,
liability or expense arising under or related to this Indenture and the Notes
and (E) expressly agrees by means of such supplemental indenture that such
Person (or, if a group of Persons, one specified Person) shall make all
filings with the Commission (and any other appropriate Person) required by the
Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel (and
shall have delivered copies thereof to the Indenture Trustee) to the effect
that such transaction will not have any material adverse federal tax
consequence to the Issuer, any Noteholder or any Certificateholder;
(v) any action that is necessary to maintain the lien and
security interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture Trustee an
Officer's Certificate and an Opinion of Counsel each stating that such
conveyance or transfer and such supplemental indenture comply with this
Article III and that all conditions precedent herein provided for relating to
such transaction have been complied with (including any filing required by the
Exchange Act) in all material respects.
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), BMW Vehicle Owner Trust 1999-A will be
released from every covenant and agreement of this Indenture to be observed by
or performed on the part of the Issuer with respect to the Notes immediately
upon the delivery of written notice to the Indenture Trustee stating that BMW
Vehicle Owner Trust 1999-A is to be so released.
Section 3.12. No Other Business. The Issuer shall not engage in any
business other than financing, purchasing, owning, selling and managing the
Receivables in the manner contemplated by this Indenture and the Basic
Documents and any activities incidental thereto. The Issuer shall not fund the
purchase of any new Receivables.
Section 3.13. No Borrowing. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes.
Section 3.14. Servicer's Obligations. The Issuer shall cause the Servicer
to comply with Sections 4.09, 4.10, 4.11 and Article VII of the Sale and
Servicing Agreement.
Section 3.15. Guarantees, Loans, Advances and Other Liabilities. Except
as contemplated by the Trust Agreement, the Sale and Servicing Agreement or
this Indenture, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
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 Person.
Section 3.16. Capital Expenditures. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
Section 3.17. Removal of Administrator. So long as any Notes are
Outstanding, the Issuer shall not remove the Administrator unless the Rating
Agency Condition shall have been satisfied in connection with such removal and
the Indenture Trustee receives written notice of the foregoing and consents
thereto.
Section 3.18. Restricted Payments. Except with respect to the proceeds
from issuance of the Notes, the Issuer shall not, directly or indirectly, (i)
pay any dividend or make any distribution (by reduction of capital or
otherwise), whether in cash, property, securities or a combination thereof, to
the Owner Trustee or any owner of a beneficial interest in the Issuer or
otherwise with respect to any ownership or equity interest or security in or
of the Issuer or to the Servicer, (ii) redeem, purchase, retire or otherwise
acquire for value any such ownership or equity interest or security or (iii)
set aside or otherwise segregate any amounts for any such purpose; provided,
however, that the Issuer may make, or cause to be made, distributions as
contemplated by, and to the extent funds are available for such purpose under,
the Sale and Servicing Agreement, this Indenture or the Trust Agreement. The
Issuer will not, directly or indirectly, make payments to or distributions
from the Note Distribution Account, the Collection Account or the Reserve
Account except in accordance with this Indenture and the Basic Documents.
Section 3.19. Notice of Events of Default. The Issuer shall give the
Indenture Trustee and the Rating Agencies prompt written notice of each Event
of Default hereunder, and of each default on the part of the Servicer or the
Seller of its obligations under the Sale and Servicing Agreement.
Section 3.20. Further Instruments and Acts. Upon request of the Indenture
Trustee, the Issuer will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect with respect to the Notes except as to (i)
rights of registration of transfer and exchange, (ii) substitution of
mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to
receive payments of principal thereof and interest thereon, (iv) Sections
3.03, 3.04, 3.05, 3.08, 3.10, 3.11, 3.12, 3.13, 3.15, 3.16 and 3.18, (v) the
rights, obligations and immunities of the Indenture Trustee hereunder
(including the rights of the Indenture Trustee under Section 6.07 and the
obligations of the Indenture Trustee under Section 4.02) and (vi) the rights
of Noteholders as beneficiaries hereof with respect to the property so
deposited with the Indenture Trustee payable to all or any of them, and the
Indenture Trustee, on demand of and at the expense of the Issuer, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture with respect to the Notes, when
(A) either:
(1) all Notes theretofore authenticated and delivered
(other than (i) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.06 and (ii) Notes for the
payment of which money has theretofore been deposited in trust or segregated
and held in trust by the Issuer and thereafter repaid to the Issuer or
discharged from such trust, as provided in Section 3.03, have been delivered
to the Indenture Trustee for cancellation; or
(2) all Notes not theretofore delivered to the Indenture
Trustee for cancellation
a. have become due and payable,
b. will become due and payable at the Class A-4
Final Scheduled Distribution Date within one year or
c. are to be called for redemption within one
year under arrangements satisfactory to the Indenture
Trustee for the giving of notice of redemption by the
Indenture Trustee in the name, and at the expense, of the
Issuer;
and the Issuer, in the case of a, b, or c above, has irrevocably
deposited or caused to be irrevocably deposited with the Indenture
Trustee cash or direct obligations of or obligations guaranteed by
the United States of America (that will mature prior to the date such
amounts are payable), in trust for such purpose, in an amount
sufficient to pay and discharge the entire indebtedness on such Notes
not theretofore delivered to the Indenture Trustee for cancellation
when due to the applicable Final Scheduled Distribution Date or
Redemption Date (if Notes shall have been called for redemption
pursuant to Section 10.01), as the case may be;
(B) the Issuer has paid or caused to be paid all other sums payable
hereunder by the Issuer including, but not limited to, fees and
expenses due to the Indenture Trustee; and
(C) the Issuer has delivered to the Indenture Trustee an Officer's
Certificate, an Opinion of Counsel and (if required by the TIA or the
Indenture Trustee) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable
requirements of Section 11.01(a) and, subject to Section 11.02, each
stating that all conditions precedent herein provided for relating to
the satisfaction and discharge of this Indenture have been complied
with.
Section 4.02. Application of Trust Money. All moneys deposited with the
Indenture Trustee pursuant to Section 4.01 hereof shall be held in trust and
applied by it in accordance with the provisions of the Notes and this
Indenture to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Holders of the particular Notes for
the payment or redemption of which such moneys have been deposited with the
Indenture Trustee, of all sums due and to become due thereon for principal and
interest; but such moneys need not be segregated from other funds except to
the extent required herein, in the Sale and Servicing Agreement or by law.
Section 4.03. Repayment of Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to the
Notes, all moneys then held by any Paying Agent other than the Indenture
Trustee under the provisions of this Indenture with respect to such Notes
shall, upon written demand of the Issuer, be paid to the Indenture Trustee to
be held and applied according to Section 3.03; and thereupon, such Paying
Agent shall be released from all further liability with respect to such
moneys.
Section 4.04. Release of Collateral. Subject to Section 11.01 and the
terms of the Basic Documents, the Indenture Trustee shall release property
from the lien of this Indenture only upon receipt by it of an Issuer Request
accompanied by an Officer's Certificate, an Opinion of Counsel and Independent
Certificates in accordance with TIA ss.ss. 314(c) and 314(d)(1) or an Opinion
of Counsel in lieu of such Independent Certificates to the effect that the TIA
does not require any such Independent Certificates.
ARTICLE V.
REMEDIES
Section 5.01. Events of Default. "Event of Default", wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or
governmental body):
(i) default in the payment of any interest on any Note when the
same becomes due and payable, and such default shall continue for a period of
five days;
(ii) default in the payment of the principal of or any
installment of the principal of any Note when the same becomes due and
payable;
(iii) default in the observance or performance of any covenant
or agreement of the Issuer made in this Indenture (other than a covenant or
agreement, a default in the observance or performance of which is elsewhere in
this Section specifically dealt with), or any representation or warranty of
the Issuer made in this Indenture or in any certificate or other writing
delivered pursuant hereto or in connection herewith proving to have been
incorrect in any material respect as of the time when the same shall have been
made, and such default shall continue or not be cured, or the circumstance or
condition in respect of which such misrepresentation or warranty was incorrect
shall not have been eliminated or otherwise cured, for a period of 30 days
after there shall have been given, by registered or certified mail, to the
Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by
the Holders of at least 50% of the Outstanding Amount of the Notes, a written
notice specifying such default or incorrect representation or warranty and
requiring it to be remedied and stating that such notice is a notice of
Default hereunder;
(iv) the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuer or any
substantial part of the Trust Estate in an involuntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now or
hereafter in effect, or the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Issuer or for any
substantial part of the Trust Estate, or the ordering of the winding-up or
liquidation of the Issuer's affairs, and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or
(v) the commencement by the Issuer of a voluntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now or
hereafter in effect, or the consent by the Issuer to the entry of an order for
relief in an involuntary case under any such law, or the consent by the Issuer
to the appointment of or taking of possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the Issuer
or for any substantial part of the Trust Estate, or the making by the Issuer
of any general assignment for the benefit of creditors, or the failure by the
Issuer generally to pay its debts as such debts become due, or the taking of
any action by the Issuer in furtherance of any of the foregoing.
The Issuer shall promptly deliver to the Indenture Trustee written notice in
the form of an Officer's Certificate of any event that with the giving of
notice and the lapse of time would become an Event of Default under clause
(iii), its status and what action the Issuer is taking or proposes to take
with respect thereto.
Section 5.02. Acceleration of Maturity; Rescission and Annulment.
(a) If an Event of Default shall occur and be continuing, then and in
every such case the Indenture Trustee may or the Indenture Trustee as directed
in writing by the Holders of Notes representing not less than a majority of
the Outstanding Amount of the Notes shall declare all the Notes to be then
immediately due and payable, by a notice in writing to the Issuer (and to the
Indenture Trustee if given by Noteholders), and upon any such declaration the
Outstanding Amount of such Notes, together with accrued and unpaid interest
thereon through the date of acceleration, shall become immediately due and
payable. In the event of any acceleration of the Notes by operation of this
Section 5.02, the Indenture Trustee shall distribute any proceeds:
FIRST: to the payment of amounts due and unpaid on the Notes in
respect of interest, ratably, without preference or priority of any
kind;
SECOND: to the payment of amounts due and unpaid on the Class A-1
Notes in respect of principal, ratably, without preference or
priority of any kind, until the Class A-1 Notes are paid in full;
THIRD: to the payment of amounts due and unpaid on the Class A-2
Notes in respect of principal, ratably, without preference or
priority of any kind, until the Class A-2 Notes are paid in full;
FOURTH: to the payment of amounts due and unpaid on the Class A-3
Notes in respect of principal, ratably, without preference or
priority of any kind, until the Class A-3 Notes are paid in full; and
FIFTH: to the payment of amounts due and unpaid on the Class A-4
Notes in respect of principal, ratably, without preference or
priority of any kind, until the Class A-4 Notes are paid in full.
(b) [Reserved].
(c) If an Event of Default under this Indenture shall have occurred
and be continuing at any time when the Indenture Trustee is the Controlling
Party, the Indenture Trustee in its discretion may, or if so requested in
writing by Holders of Notes representing at least a majority of the
Outstanding Amount of the Notes, shall, declare by written notice to the
Issuer all of the Notes to be immediately due and payable, and upon any such
declaration, the Outstanding Amount of the Notes, together with accrued
interest thereon through the date of acceleration, shall become immediately
due and payable as provided in the Notes set forth in Exhibit A-1, Exhibit
A-2, Exhibit A-3 and Exhibit A-4. Notwithstanding anything to the contrary in
this paragraph (c), if an Event of Default specified in clauses (iv) or (v) of
Section 5.01 shall have occurred and be continuing at any time when the
Indenture Trustee is the Controlling Party, the Notes shall become immediately
due and payable at par, together with accrued interest thereon.
(d) At any time after such declaration of acceleration of maturity
has been made and before a judgment or decree for payment of the money due has
been obtained by the Indenture Trustee as hereinafter in this Article V
provided, the Holders of Notes representing a majority of the Outstanding
Amount of the Notes, by written notice to the Issuer and the Indenture
Trustee, may rescind and annul such declaration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture Trustee
a sum sufficient to pay:
A. all payments of principal of and interest on the Notes
and all other amounts that would then be due hereunder or upon such Notes if
the Event of Default giving rise to such acceleration had not occurred; and
B. all sums paid by the Indenture Trustee hereunder and the
reasonable compensation, expenses and disbursements of the Indenture Trustee
and its agents and counsel and the reasonable compensation, expenses and
disbursements of the Owner Trustee and its agents and counsel; and
(ii) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such acceleration, have
been cured or waived as provided in Section 5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee; Authority of the Controlling Party.
(a) The Issuer covenants that if (i) a default is made in the payment
of any interest on any Note when the same becomes due and payable, and such
default continues for a period of five Business Days or, (ii) default is made
in the payment of the principal of or any installment of the principal of any
Note when the same becomes due and payable, the Issuer will, upon demand of
the Indenture Trustee, pay to it, for the benefit of the Holders of the Notes,
the entire amount then due and payable on such Notes in respect of principal
and interest, with interest on the overdue principal and, to the extent
payment at such rate of interest shall be legally enforceable, on overdue
installments of interest at the related Interest Rate and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses and
disbursements of the Indenture Trustee and its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such amounts upon
such demand, the Indenture Trustee, in its own name and as trustee of an
express trust, may institute a Proceeding for the collection of the sums so
due and unpaid, and may prosecute such Proceeding to judgment or final decree,
and may enforce the same against the Issuer or other obligor on such Notes and
collect in the manner provided by law out of the Trust Estate or the property
of any other obligor on such Notes, wherever situated, the moneys adjudged or
decreed to be payable.
(c) If an Event of Default occurs, the Indenture Trustee may, as more
particularly provided in Section 5.04, in its discretion or shall at the
directions of the Holders of at least a majority of the Outstanding Amount of
the Notes proceed to protect and enforce its rights and the rights of the
Noteholders, by such appropriate Proceedings as the Indenture Trustee or the
Indenture Trustee at the direction of the Holders of at least a majority of
the Outstanding Amount of the Notes shall reasonably deem most effective to
protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy or legal or
equitable right vested in the Indenture Trustee by this Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or any
other obligor on the Notes or any Person having or claiming an ownership
interest in the Trust Estate, Proceedings under Title 11 of the United States
Code or any other applicable federal or state bankruptcy, insolvency or other
similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, or liquidator, sequestrator or similar official shall have
been appointed for or taken possession of the Issuer or its property or such
other obligor or Person, or in case of any other comparable Proceedings
relative to the Issuer or other obligor on the Notes, or to the creditors or
property of the Issuer or such other obligor, the Indenture Trustee,
irrespective of whether the principal of any Notes shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective
of whether the Indenture Trustee shall have made any demand pursuant to the
provisions of this Section, shall be entitled and empowered, by intervention
in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the entire amount of
principal and interest owing and unpaid in respect of the Notes and to file
such other papers or documents as may be necessary or advisable in order to
have the claims of the Indenture Trustee (including any claim for reasonable
compensation to the Indenture Trustee and each predecessor Indenture Trustee,
and their respective agents, attorneys and counsel, and for reimbursement of
reasonable out-of-pocket expenses and liabilities incurred, by the Indenture
Trustee and each predecessor Indenture Trustee, except as a result of
negligence or bad faith) and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law or regulation, to vote
on behalf of the Holders of Notes in any election of a trustee, a standby
trustee or a Person performing similar functions in any such Proceedings;
(iii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders and of the Indenture
Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Indenture
Trustee or the Holders of Notes allowed in any Proceedings relative to the
Issuer, its creditors or 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, in the event that the Indenture Trustee
shall consent to the making of payments directly to such Noteholders, to pay
to the Indenture Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Indenture Trustee, each predecessor Indenture
Trustee and their respective agents, attorneys and counsel, and all other
expenses and liabilities incurred by the Indenture Trustee and each
predecessor Indenture Trustee except as a result of negligence or bad faith.
(e) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Noteholder any plan of reorganization, arrangement, adjustment
or composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the
election of a trustee in bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this
Indenture, or under 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
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
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Holders of the Notes.
(g) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Holders of the Notes, and it shall not be necessary
to make any Noteholder a party to any such Proceedings.
Section 5.04. Remedies; Priorities.
(a) If an Event of Default shall have occurred and be continuing, the
Indenture Trustee may do one or more of the following (subject to Section
5.05):
(i) institute Proceedings in its own name and as trustee of an
express trust for the collection of all amounts then payable on the Notes or
under this Indenture with respect thereto, whether by declaration or
otherwise, enforce any judgment obtained and collect from the Issuer and any
other obligor on such Notes moneys adjudged due;
(ii) institute Proceedings from time to time for the complete or
partial foreclosure of this Indenture with respect to the Trust Estate;
(iii) exercise any remedies of a secured party under the UCC and
take any other appropriate action to protect and enforce the rights and
remedies of the Indenture Trustee and the Holders of the Notes; and
(iv) sell the Trust Estate or any portion thereof or rights or
interest therein, at one or more public or private sales called and conducted
in any manner permitted by law;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Trust Estate following an Event of Default, other than an Event
of Default described in Section 5.01(i) or (ii), unless (A) the Holders of
100% of the Outstanding Amount of the Notes consent thereto, (B) the proceeds
of such sale or liquidation distributable to the Noteholders are sufficient to
discharge in full all amounts then due and unpaid on such Notes in respect of
principal and interest or (C) the Indenture Trustee determines that the Trust
Estate will not continue to provide sufficient funds for the payment of
principal of and interest on the Notes as they would have become due if the
Notes had not been declared due and payable, and the Indenture Trustee obtains
the consent of Holders of at least two-thirds the Outstanding Amount of the
Notes. In determining such sufficiency or insufficiency with respect to clause
(B) and (C), the Indenture Trustee may, at the Issuer's expense and paid in
the priority set forth in Section 5.06(b) of the Sale and Servicing Agreement,
but need not, obtain and conclusively rely upon an opinion of an Independent
investment banking or accounting firm of national reputation as to the
feasibility of such proposed action and as to the sufficiency of the Trust
Estate for such purpose.
(b) If the Indenture Trustee collects any money or property pursuant
to this Article V, it shall pay out the money or property in the following
order:
FIRST: to the Indenture Trustee for amounts due under Section 6.07;
SECOND: to Noteholders for amounts due and unpaid on the Notes in
respect of interest (including any premium), ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes in respect of interest (including any premium);
THIRD: to Holders of the Class A-1 Notes for amounts due and unpaid
on the Class A-1 Notes in respect of principal, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class A-1 Notes in respect of principal, until the
Outstanding Amount of the Class A-1 Notes is reduced to zero;
FOURTH: to Holders of the Class A-2 Notes for amounts due and unpaid
on the Class A-2 Notes in respect of principal, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class A-2 Notes in respect of principal, until the
Outstanding Amount of the Class A-2 Notes is reduced to zero;
FIFTH: to Holders of the Class A-3 Notes for amounts due and unpaid
on the Class A-3 Notes in respect of principal, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class A-3 Notes in respect of principal, until the
Outstanding Amount of the Class A-3 Notes is reduced to zero;
SIXTH: to Holders of the Class A-4 Notes for amounts due and unpaid
on the Class A-4 Notes in respect of principal, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class A-4 Notes in respect of principal, until the
Outstanding Amount of the Class A-4 Notes is reduced to zero; and
SEVENTH: pursuant to Section 5.06(b) of the Sale and Servicing
Agreement.
The Indenture Trustee may fix a record date and payment date for any payment
to Noteholders pursuant to this Section. At least 15 days before such record
date, the Issuer shall mail to each Noteholder and the Indenture Trustee a
notice that states the record date, the payment date and the amount to be
paid.
Section 5.05. Optional Preservation of the Receivables. If the Indenture
Trustee is the Controlling Party and the Notes have been declared to be due
and payable under Section 5.02 following an Event of Default, and such
declaration and its consequences have not been rescinded and annulled, the
Indenture Trustee may, but need not, elect to maintain possession of the Trust
Estate. It is the desire of the parties hereto and the Noteholders that there
be at all times sufficient funds for the payment of principal of and interest
on the Notes, and the Indenture Trustee shall take such desire into account
when determining whether or not to maintain possession of the Trust Estate. In
determining whether or not to maintain possession of the Trust Estate, the
Indenture Trustee may, at the expense of the Issuer and paid in the priority
set forth in Section 5.06(b) of the Sale and Servicing Agreement, but need
not, obtain and conclusively rely upon an opinion of an Independent investment
banking or accounting firm of national reputation as to the feasibility of
such proposed action and as to the sufficiency of the Trust Estate for such
purpose.
Section 5.06. Limitation of Suits. No Holder of any Note shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(i) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the Outstanding Amount
of the Notes have made written request to the Indenture Trustee to institute
such Proceeding in respect of such Event of Default in its own name as
Indenture Trustee hereunder;
(iii) such Holder or Holders have offered to the Indenture
Trustee reasonable indemnity against the costs, expenses and liabilities that
may be incurred in complying with such request;
(iv) the Indenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute such
Proceedings; and
(v) 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 is understood and intended that no one or more Holders of Notes shall have
any right in any manner whatsoever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Notes or to obtain or to seek to obtain priority or
preference over any other Holders or to enforce any right under this
Indenture, except in the manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Notes pursuant to this Section, each representing less than a majority of the
Outstanding Amount of the Notes, the Indenture Trustee shall act at the
direction of the group representing the greater percentage of the Outstanding
Amount of Notes and if there is no such group then in its sole discretion may
determine what action, if any, shall be taken, notwithstanding any other
provisions of this Indenture.
Section 5.07. Unconditional Rights of Noteholders To Receive Principal
and Interest. Notwithstanding any other provisions in this Indenture, the
Holder of any Note shall have the right, which is absolute and unconditional,
to receive payment of the principal of and interest, if any, on such Note on
or after the respective due dates thereof expressed in such Note or in this
Indenture (or, in the case of redemption, on or after the Redemption Date) and
to institute suit for the enforcement of any such payment, and such right
shall not be impaired without the consent of such Holder.
Section 5.08. Restoration of Rights and Remedies. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right
or remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had
been instituted.
Section 5.09. Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or to the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 5.10. Delay or Omission Not a Waiver. No delay or omission of the
Indenture Trustee, or any Holder of any Note to exercise any right or remedy
accruing upon any Default or Event of Default shall impair any such right or
remedy or constitute a waiver of any such Default or Event of Default or an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Indenture Trustee or to the Noteholders may be exercised from time to
time, and as often as may be deemed expedient, by the Indenture Trustee or the
Noteholders, as the case may be.
Section 5.11. Control by Noteholders. If the Indenture Trustee is the
Controlling Party, the Holders of a majority of the Outstanding Amount of the
Notes shall have the right to direct the time, method and place of conducting
any Proceeding for any remedy available to the Indenture Trustee with respect
to the Notes or exercising any trust or power conferred on the Indenture
Trustee; provided that:
(i) such direction shall not be in conflict with any rule of law
or with this Indenture;
(ii) subject to the express terms of Section 5.04, any direction
to the Indenture Trustee to sell or liquidate the Trust Estate shall be by
Holders of Notes representing not less than 100% of the Outstanding Amount of
the Notes;
(iii) if the conditions set forth in Section 5.05 have been
satisfied and the Indenture Trustee elects to retain the Trust Estate pursuant
to such Section, then any written direction to the Indenture Trustee by
Holders of Notes representing less than 100% of the Outstanding Amount of the
Notes to sell or liquidate the Trust Estate shall be of no force and effect;
and
(iv) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee that is not inconsistent with such direction.
Notwithstanding the rights of Noteholders set forth in this Section, subject
to Section 6.01, the Indenture Trustee need not take any action that it
determines might involve it in liability or might materially adversely affect
the rights of any Noteholders not consenting to such action.
Section 5.12. Waiver of Past Defaults. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.02, the
Holders of Notes of not less than a majority of the Outstanding Amount of the
Notes may, waive any past Default or Event of Default and its consequences
except a Default (a) in payment of principal of or interest on any of the
Notes or (b) in respect of a covenant or provision hereof that cannot be
modified or amended without the consent of the Holder of each Note. In the
case of any such waiver, the Issuer, the Indenture Trustee and the Holders of
the Notes shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereto.
Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereto.
Section 5.13. Undertaking for Costs. All parties to this Indenture agree,
and each Holder of a Note by such Holder's acceptance thereof shall be deemed
to have agreed, that any court may in its discretion require, in any suit for
the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it
as Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (a) any suit instituted by the
Indenture Trustee, (b) any suit instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Amount of the Notes or (c) any suit instituted by any Noteholder
for the enforcement of the payment of principal of or interest on any Note on
or after the respective due dates expressed in such Note and in this Indenture
(or, in the case of redemption, on or after the Redemption Date).
Section 5.14. Waiver of Stay or Extension Laws. The Issuer covenants (to
the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that
it will not hinder, delay or impede the execution of any power herein granted
to the Indenture Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.
Section 5.15. Action on Notes. The Indenture Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with
respect to this Indenture. Neither the lien of this Indenture nor any rights
or remedies of the Indenture Trustee or the Noteholders shall be impaired by
the recovery of any judgment by the Indenture Trustee against the Issuer or by
the levy of any execution under such judgment upon any portion of the Trust
Estate or upon any of the assets of the Issuer. Any money or property
collected by the Indenture Trustee shall be applied in accordance with Section
5.04(b).
Section 5.16. Performance and Enforcement of Certain Obligations.
(a) Promptly following a request from the Indenture Trustee to do so
and at the Administrator's expense, the Issuer shall take all such lawful
action as the Indenture Trustee may request to compel or secure the
performance and observance by the Sellers or the Servicer, as applicable, of
each of their obligations to the Issuer under or in connection with the Sale
and Servicing Agreement or the Receivables Purchase Agreement, as applicable,
and to exercise any and all rights, remedies, powers and privileges lawfully
available to the Issuer under or in connection with the Sale and Servicing
Agreement or 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 either Seller or the Servicer thereunder and
the institution of legal or administrative actions or proceedings to compel or
secure performance by the Sellers or the Servicer of each of their obligations
under the Sale and Servicing Agreement or the Receivables Purchase Agreement;
provided, however, nothing herein shall in any way impose on the Indenture
Trustee the duty to monitor the performance of the Seller or the Servicer of
any of their liabilities, duties or obligations under any Basic Document.
(b) If an Event of Default has occurred, the Indenture Trustee may,
and at the direction (which direction shall be in writing) of the Holders of
not less than a majority of the Outstanding Amount of the Notes shall,
exercise all rights, remedies, powers, privileges and claims of the Issuer
against the Sellers or the Servicer under or in connection with the Sale and
Servicing Agreement and the Receivables Purchase Agreement including the right
or power to take any action to compel or secure performance or observance by
the Sellers or the Servicer, as the case may be, of each of their obligations
to the Issuer thereunder and to give any consent, request, notice, direction,
approval, extension or waiver under the Sale and Servicing Agreement and the
Receivables Purchase Agreement, as the case may be, and any right of the
Issuer to take such action shall be suspended.
ARTICLE VI.
THE INDENTURE TRUSTEE
Section 6.01. Duties of Indenture Trustee.
(a) If an Event of Default has occurred and is continuing 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.
(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 no
implied covenants or obligations shall be read into this Indenture against the
Indenture Trustee; and
(ii) in the absence of bad faith or negligence 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 the face value of the
certificates, reports, resolutions, documents, orders, opinions or other
instruments furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; provided, however, that the Indenture Trustee
shall not be responsible for the accuracy or content of any such resolution,
certificate, statement, opinion, report, document, order or other instrument;
however, the Indenture Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this Indenture.
If any such instrument is found not to conform in any material respect to the
requirements of this Agreement, the Indenture Trustee shall notify the
Noteholders of such instrument in the event that the Indenture Trustee, after
so requesting, does not receive a satisfactorily corrected instrument.
(c) The Indenture Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
(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 the terms of this Indenture or any other
Basic Documents.
(d) Every provision of this Indenture that in any way relates to the
Indenture Trustee is subject to paragraphs (a), (b), (c) and (g) of this
Section.
(e) The Indenture Trustee shall not be liable for indebtedness
evidenced by or arising under any of the Basic Documents, including principal
of or interest on the Notes, or interest on any money received by it except as
the Indenture Trustee may agree in writing with the Issuer.
(f) Money held in trust by the Indenture Trustee need not be
segregated from other funds except to the extent required by law or the terms
of this Indenture or the Sale and Servicing Agreement.
(g) No provision of this Indenture shall require the Indenture
Trustee to advance, 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 repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of
the TIA.
(i) In no event shall the Indenture Trustee be required to perform,
or be responsible for the manner of performance of, any of the obligations of
the Servicer or any other party under the Sale and Servicing Agreement.
(j) The Indenture Trustee shall have no duty (A) to see to any
recording, filing, or depositing of this Indenture or any agreement referred
to herein or any financing statement or continuation statement evidencing a
security interest, or to see to the maintenance of any such recording or
filing or depositing or to any rerecording, refiling or redepositing of any
thereof, (B) to see to any insurance, or (C) to see to the payment or
discharge of any tax, assessment, or other governmental charge or any lien or
encumbrance of any kind owing with respect to, assessed or levied against, any
part of the Trust Fund.
For purposes of this Section 6.01 and Section 8.03(c), the Indenture
Trustee, or a Responsible Officer thereof, shall be charged with actual
knowledge of any default or an Event of Default if a Responsible Officer
actually knows of such default or Event of Default or the Indenture Trustee
receives written notice of such default or Event of Default from the Issuer,
the Servicer or Noteholders owning Notes aggregating not less than 10% of the
Outstanding Amount of the Notes. Notwithstanding the foregoing, the Indenture
Trustee shall not be required to take notice and in the absence of such actual
notice and knowledge, the Indenture Trustee may conclusively assume that there
is no such default or Event of Default.
Section 6.02. Rights of Indenture Trustee.
(a) The Indenture Trustee may conclusively rely on the face value of
any document believed by it to be genuine and to have been signed or presented
by the proper person. The Indenture Trustee need not investigate any fact or
matter stated in the document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel from the appropriate
party. The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on an Officer's Certificate or Opinion
of Counsel from the appropriate party. The right of the Indenture Trustee to
perform any discretionary act enumerated in this Indenture or in any Basic
Document shall not be construed as a duty of the Indenture Trustee and the
Indenture Trustee shall not be answerable for other than its negligence or
willful misconduct in the performance of such discretionary act.
(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 any such
agent, attorney or custodian appointed by the Indenture Trustee with due care.
(d) The Indenture Trustee shall not be liable for any action it takes
or omits to take in good faith that it believes to be authorized or within its
rights or powers; provided, that the Indenture Trustee's conduct does not
constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult, at the Issuer's expense and
paid in the priority set forth in Section 5.06(b) of the Sale and Servicing
Agreement, with counsel, and the written 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) In the event that the Indenture Trustee is also acting as Paying
Agent, Note Registrar or collateral agent, the rights and protections afforded
to the Indenture Trustee pursuant to this Article 6 shall be afforded to such
Paying Agent, Note Registrar or collateral agent.
(g) The Indenture Trustee shall be under no obligation to exercise
any of the trusts or powers vested in it by this Indenture or to institute,
conduct or defend any litigation hereunder or in relation hereto at the
request, order or direction of any of the Noteholders, pursuant to the
provisions of this Indenture, unless such Noteholders shall have offered to
the Indenture Trustee reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred therein or thereby;
(h) The right of the Indenture Trustee to perform any discretionary
act enumerated in this Indenture shall not be construed as a duty, and the
Indenture Trustee shall not be answerable for other than its negligence or
willful misconduct in the performance of such act; and
(i) The Indenture Trustee shall not be required to give any bond or
surety in respect of the powers granted hereunder.
Section 6.03. Individual Rights of Indenture Trustee. The Indenture
Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Issuer or its Affiliates with
the same rights it would have if it were not Indenture Trustee. Any Paying
Agent, Note Registrar, co-registrar or co-paying agent may do the same with
like rights. However, the Indenture Trustee must comply with Sections 6.11 and
6.12.
Section 6.04. Indenture Trustee's Disclaimer. The Indenture Trustee shall
not be responsible for and makes no representation as to the validity or
adequacy of this Indenture, the Trust Estate or the Notes, it shall not be
accountable for the Issuer's use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in the Indenture, any Basic
Document 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 6.05. 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 30 days after it occurs. Except in the case of a Default in payment of
principal of or interest on any Note (including payments pursuant to the
mandatory redemption provisions of such Note), the Indenture Trustee may
withhold the notice to Noteholders if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is
in the interests of Noteholders.
Section 6.06. Reports by Indenture Trustee to Holders. The Indenture
Trustee shall deliver to each Noteholder such information as may be required
to enable such holder to prepare its federal and state income tax returns.
Section 6.07. Compensation and Indemnity. The Issuer shall cause the
Administrator to pay to the Indenture Trustee from time to time reasonable
compensation for its services. The Indenture Trustee's compensation shall not
be limited by any law on compensation of a trustee of an express trust. The
Issuer shall cause the Administrator to reimburse the Indenture Trustee for
all reasonable out-of-pocket expenses incurred or made by it, including costs
of collection, in addition to the compensation for its services. Such expenses
shall include the reasonable out-of-pocket compensation and expenses,
disbursements and advances of the Indenture Trustee's agents, counsel,
accountants and experts. The Issuer shall cause the Administrator to indemnify
the Indenture Trustee against any and all loss, liability or expense
(including attorneys' fees and expenses) incurred by it in connection with the
administration of this trust and the performance of its duties hereunder or
under the Sale and Servicing Agreement or under any other Basic Document. The
Indenture Trustee shall notify the Issuer and the Administrator promptly of
any claim for which it may seek indemnity. Failure by the Indenture Trustee to
so notify the Issuer and the Administrator shall not relieve the Issuer or the
Administrator of its obligations hereunder if no prejudice to the Issuer or
the Administrator shall have resulted from such failure. The Issuer shall, or
shall cause the Administrator to, defend any such claim, and the Indenture
Trustee may have separate counsel and the Issuer shall, or shall cause the
Administrator to, pay the fees and expenses of such counsel. Neither the
Issuer nor the Administrator need reimburse any expense or indemnify against
any loss, liability or expense incurred by the Indenture Trustee through the
Indenture Trustee's own willful misconduct, negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee and the
Administrator's indemnities to the Indenture Trustee pursuant to this Section
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 5.01(iv) or (v) with
respect to the Issuer, the expenses are intended to constitute expenses of
administration under Title 11 of the United States Code or any other
applicable federal or state bankruptcy, insolvency or similar law.
Section 6.08. Replacement of Indenture Trustee. No resignation or removal
of the Indenture Trustee and no appointment of a successor Indenture Trustee
shall become effective until the acceptance of appointment by the successor
Indenture Trustee pursuant to this Section 6.08. The Indenture Trustee may
resign at any time by so notifying the Issuer and each Rating Agency. The
Holders of a majority in Outstanding Amount of the Notes may remove the
Indenture Trustee by notifying the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) the Indenture Trustee is adjudged a bankrupt or insolvent;
(iii) a receiver or other public officer takes charge of the
Indenture Trustee or its property;
(iv) the Indenture Trustee otherwise becomes incapable of
acting; or
(v) the Indenture Trustee breaches any representation, warranty
or covenant made by it under any Basic Document.
If the Indenture Trustee resigns 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 a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance of
its appointment to the retiring Indenture Trustee and to the Issuer. Thereupon
the resignation or removal of the retiring Indenture Trustee shall become
effective, and the successor Indenture Trustee shall have all the rights,
powers and duties of the Indenture Trustee under this Indenture. The retiring
Indenture Trustee shall be paid all amounts owed to it upon its resignation or
removal. The successor Indenture Trustee shall mail a notice of its succession
to Noteholders. The retiring Indenture Trustee shall promptly transfer all
property held by it as Indenture Trustee to the successor Indenture Trustee.
The retiring Indenture Trustee shall not be liable for the acts or omissions
of any Successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 60 days
after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Holders of a majority in Outstanding
Amount of the Notes may petition any court of competent jurisdiction for the
appointment of a successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant to
this Section, the Issuer's and the Administrator's obligations under Section
6.07 shall continue for the benefit of the retiring Indenture Trustee.
Section 6.09. Successor Indenture Trustee by Merger. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation without any further act shall be the successor Indenture Trustee;
provided, that such corporation or banking association shall be qualified and
eligible under Section 6.11. The Indenture Trustee shall provide the Rating
Agencies notice of any such transaction.
In case at the time such successor or successors by merger,
conversion or consolidation to the Indenture Trustee shall succeed to the
trusts created by this Indenture 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; and in all such cases such
certificates shall have the full force that it is anywhere in the Notes or in
this Indenture provided that the certificate of the Indenture Trustee shall
have.
Section 6.10. Appointment of Co-Indenture Trustee or Separate Indenture
Trustee.
(a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Trust Estate may at the time be located, the Indenture
Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a co-trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Trust, and to vest in
such Person or Persons, in such capacity and for the benefit of the
Noteholders, such title to the Trust Estate, or any part thereof, and, subject
to the other provisions of this Section, such powers, duties, obligations,
rights and trusts as the Indenture Trustee may consider necessary or
desirable. No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under Section 6.11 and no
notice to Noteholders of the appointment of any co-trustee or separate trustee
shall be required under Section 6.08 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Indenture Trustee shall be conferred or imposed upon and
exercised or performed by the Indenture Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Indenture Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed the
Indenture Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and obligations (including
the holding of title to the Trust Estate or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee
or co-trustee, but solely at the direction of the Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture
Trustee shall be deemed to have been given to each of the then separate
trustees and co-trustees, as effectively as if given to each of them. Every
instrument appointing any separate trustee or co-trustee shall refer to this
Agreement and the conditions of this Article VI. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Indenture Trustee or separately, as may be provided therein,
subject to all the provisions of this Indenture, specifically including every
provision of this Indenture relating to the conduct of, affecting the
liability of, or affording protection to, the Indenture Trustee. Every such
instrument shall be filed with the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee, 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 Indenture Trustee, to the extent permitted by
law, without the appointment of a new or successor trustee.
Section 6.11. Eligibility; Disqualification. The Indenture Trustee shall
at all times satisfy the requirements of TIA ss. 310(a). The Indenture Trustee
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition, and the time deposits
of the Indenture Trustee shall be rated at least A-1 by Standard & Poor's and
P-1 by Moody's. The Indenture Trustee shall comply with TIA ss. 310(b),
including the optional provision permitted by the second sentence of TIA ss.
310(b)(9); 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. [Reserved].
Section 6.13. 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). An Indenture Trustee who has resigned
or been removed shall be subject to TIA ss. 311(a) to the extent indicated.
Section 6.14. Waiver of Setoffs. The Indenture Trustee hereby expressly
waives any and all rights of setoff that the Indenture Trustee may otherwise
at any time have under applicable law with respect to any Trust Account and
agrees that amounts in the Trust Accounts shall at all times be held and
applied solely in accordance with the provisions hereof and of the other Basic
Documents.
ARTICLE VII.
NOTEHOLDERS' LISTS AND REPORTS
Section 7.01. Issuer To Furnish Indenture Trustee Names and Addresses of
Noteholders. The Issuer will furnish or cause to be furnished to the Indenture
Trustee (a) not more than five days after the earlier of (i) each Record Date
and (ii) three months after the last Record Date, a list, in such form as the
Indenture Trustee may reasonably require, of the names and addresses of the
Holders of Notes as of such Record Date, and (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date
not more than 10 days prior to the time such list is furnished; provided,
however, that so long as the Indenture Trustee is the Note Registrar, no such
list shall be required to be furnished.
Section 7.02. Preservation of Information; Communications to Noteholders.
(a) The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as
provided in Section 7.01 and the names and addresses of Holders of Notes
received by the Indenture Trustee in its capacity as Note Registrar. The
Indenture Trustee may destroy any list furnished to it as provided in such
Section 7.01 upon receipt of a new list so furnished. The Indenture Trustee
shall make such list available to the Owner Trustee on written request, and to
the Noteholders upon written request of three or more Noteholders or one or
more Noteholders evidencing not less than 25% of the Outstanding Amount of the
Notes. Upon receipt by the Indenture Trustee of any request by a Noteholder to
receive a copy of the current list of Noteholders, the Indenture Trustee shall
promptly notify the Administrator thereof by providing to the Administrator a
copy of such request and a copy of the list of Noteholders in response
thereto.
(b) Noteholders may communicate pursuant to TIAss. 312(b) with other
Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall
have the protection of TIA ss. 312(c).
Section 7.03. Reports by Issuer.
(a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after the
Issuer is required (if at all) to file the same with the Commission, copies of
the annual reports and of the information, documents and other reports (or
copies of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) that the Issuer may be
required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act;
(ii) file with the Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from time to time by the
Commission such additional information, documents and reports with respect to
compliance by the Issuer with the conditions and covenants of this Indenture
as may be required from time to time by such rules and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture Trustee
shall transmit by mail to all Noteholders described in TIA 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 7.03(a) and by
rules and regulations prescribed from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year.
Section 7.04. Reports by Indenture Trustee. If required by TIA ss.
313(a), within 60 days after each March 31 beginning with March 31, 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). The
Indenture Trustee also shall comply with TIA ss. 313(b).
A copy of each report at the time of its mailing to Noteholders shall
be filed by the Indenture Trustee with the Commission and each stock exchange,
if any, on which the Notes are listed. The Issuer shall notify the Indenture
Trustee if and when the Notes are listed on any stock exchange.
ARTICLE VIII.
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.01. Collection of Money. Except as otherwise expressly provided
herein, the Indenture Trustee may demand payment or delivery of, and shall
receive and collect, directly and without intervention or assistance of any
fiscal agent or other intermediary, all money and other property payable to or
receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it as provided in this
Indenture. Except as otherwise expressly provided in this Indenture, if any
default occurs in the making of any payment or performance under any agreement
or instrument that is part of the Trust Estate, the Indenture Trustee may take
such action as may be appropriate to enforce such payment or performance,
including the institution and prosecution of appropriate Proceedings. Any such
action shall be without prejudice to any right to claim a Default or Event of
Default under this Indenture and any right to proceed thereafter as provided
in Article V.
Section 8.02. Trust Accounts.
(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 and, in the case of the Collection Account and
the Reserve Account, the Certificateholders, the Trust Accounts as provided in
Section 5.01 of the Sale and Servicing Agreement.
(b) On the day required by Section 5.02 of the Sale and Servicing
Agreement, the Total Distribution Amount (net of the Servicing Fee for such
Distribution Date and any previously unpaid Servicing Fees and any other
distributable amounts that are to be allocated for distribution or release to
the Sellers) with respect to the preceding Collection Period will be deposited
in the Collection Account as provided in Section 5.02 of the Sale and
Servicing Agreement. On or before each Distribution Date, all amounts required
to be deposited in the Note Distribution Account with respect to the related
Collection Period pursuant to Section 5.06 of the Sale and Servicing Agreement
will be transferred from the Collection Account and the Reserve Account to the
Note Distribution Account.
(c) On each Distribution Date and Redemption Date, the Indenture
Trustee shall distribute all amounts on deposit in the Note Distribution
Account to the Noteholders in respect of the Notes to the extent of amounts
due and unpaid on the Notes for principal and interest (including any premium)
in the following amounts and in the following order of priority (except as
otherwise provided in Section 5.04(b)):
(i) accrued and unpaid interest on the Notes; provided, that if
there are not sufficient funds allocated in the Collection Account for
distribution to the Noteholders to pay the entire amount of accrued and unpaid
interest then due on the Notes, the amount on deposit in the Note Distribution
Account shall be applied to the payment of such interest on the Notes pro rata
on the basis of the total such interest due on the Notes; and
(ii) the Noteholders' Principal Distributable Amount in the
following order of priority:
(1) to the Holders of the Class A-1 Notes on account of
principal until the Outstanding Amount of the Class A-1 Notes is reduced to
zero;
(2) to the Holders of the Class A-2 Notes on account of
principal until the Outstanding Amount of the Class A-2 Notes is reduced to
zero;
(3) to the Holders of the Class A-3 Notes on account of
principal until the Outstanding Amount of the Class A-3 Notes is reduced to
zero; and
(4) to the Holders of the Class A-4 Notes on account of
principal until the Outstanding Amount of the Class A-4 Notes is reduced to
zero.
After making the distributions from the Collection Account to the Note
Distribution Account and subject to Section 8.04, the Indenture Trustee shall
make the distributions from the Collection Account, if any, to the
Certificateholders and BMW FS Receivables Corporation called for pursuant to
Sections 5.06(b)(iv), (v) and (x)of the Sale and Servicing Agreement; provided
that if the Owner Trustee has removed the Indenture Trustee as the paying
agent for the Issuer, the Indenture Trustee shall distribute such amounts to
the paying agent for the Issuer as instructed by the Owner Trustee.
Section 8.03. General Provisions Regarding Accounts. 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.
Section 8.04. Release of Trust Estate.
(a) Subject to the payment of its fees and expenses pursuant to
Section 6.07, the Indenture Trustee may, and when required by the provisions
of this Indenture shall, execute instruments to release property from the lien
of this Indenture, or convey the Indenture Trustee's interest in the same, in
a manner and under circumstances that are not inconsistent with the provisions
of this Indenture. No party relying upon an instrument executed by the
Indenture Trustee as provided in this Article VIII shall be bound to ascertain
the Indenture Trustee's authority, inquire into the satisfaction of any
conditions precedent or see to the application of any moneys.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and all sums due the Indenture Trustee pursuant to Section 6.07
have been paid in full, release any remaining portion of the Trust Estate that
secured the Notes from the lien of this Indenture and release to the Issuer or
any other Person entitled thereto any funds then on deposit in the Trust
Accounts. The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 8.04(b) only upon receipt by it of an
Issuer Request accompanied by an Officer's Certificate, an Opinion of Counsel
and (if required by the TIA) Independent Certificates in accordance with TIA
ss.ss. 314(c) and 314(d)(1) meeting the applicable requirements of Section
11.01.
(c) The Issuer agrees, upon request by the Servicer and
representation by the Servicer that it has complied with the procedure in
Section 9.01 of the Sale and Servicing Agreement, to render the Issuer Request
to the Indenture Trustee in accordance with Section 4.04, and take such other
actions as are required in that Section.
Section 8.05. Opinion of Counsel. The Indenture Trustee shall receive at
least seven days prior written notice when requested by the Issuer to take any
action pursuant to Section 8.04(b), accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, as a condition to such
action, an Opinion of Counsel, in form and substance satisfactory to the
Indenture Trustee, stating the legal effect of any such action, outlining the
steps required to complete the same, and concluding that all conditions
precedent to the taking of such action have been complied with and such action
will not materially and adversely impair the security for the Notes or the
rights of the Noteholders in contravention of the provisions of this
Indenture; provided, however, that such Opinion of Counsel shall not be
required to express an opinion as to the fair value of the Trust Estate.
Counsel rendering any such opinion may rely, without independent
investigation, on the accuracy and validity of any certificate or other
instrument delivered to the Indenture Trustee in connection with any such
action.
ARTICLE IX.
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of the Holders of any Notes but with prior
written notice to the Rating Agencies (with copy to the Indenture Trustee),
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 supplemental
indentures hereto (which shall conform to the provisions of the Trust
Indenture Act as in force at the date of the execution thereof), in form
satisfactory to the Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property at any
time subject to the lien of this Indenture, or better to assure, convey and
confirm unto the Indenture Trustee any property subject or required to be
subjected to the lien of this Indenture, or to subject to the lien of this
Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein and in
the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit of
the Holders of the Notes, or to surrender any right or power herein conferred
upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture that may be inconsistent
with any other provision herein or in any supplemental indenture or to make
any other provisions with respect to matters or questions arising under this
Indenture or in any supplemental indenture; provided, that such action shall
not adversely affect the interests of the Holders of the Notes;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes and to
add to or change any of the provisions of this Indenture as shall be necessary
to facilitate the administration of the trusts hereunder by more than one
trustee, pursuant to the requirements of Article VI; or
(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.
The Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an
Issuer Order, may, also without the consent of any of the Holders of the Notes
but with prior notice to the Rating Agencies, enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of, this Indenture
or of modifying in any manner the rights of the Holders of the Notes under
this Indenture; provided, however, that such action shall not, as evidenced by
an Opinion of Counsel, adversely affect in any material respect the interests
of any Noteholder provided further that such action shall not be deemed to
adversely affect in any material respect the interests of any Noteholder and
no Opinion of Counsel to that effect shall be required if the person
requesting such amendment obtains a letter from the Rating Agencies stating
that the amendment would not result in the downgrading or withdrawal of the
ratings then assigned to the Notes.
Section 9.02. Supplemental Indentures with Consent of Noteholders. The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, also
may, with prior notice to the Rating Agencies and with the consent of the
Holders of not less than a majority of the Outstanding Amount of the Notes, 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, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby:
(i) change the date of payment of any installment of principal
of or interest on any Note, or reduce the principal amount thereof, the
interest rate thereon or the Redemption Price with respect thereto, change the
provisions of this Indenture relating to the application of collections on, or
the proceeds of the sale of, the Trust Estate to payment of principal of or
interest on the Notes, or change any place of payment where, or the coin or
currency in which, any Note or the interest thereon is payable, or impair the
right to institute suit for the enforcement of the provisions of this
Indenture requiring the application of funds available therefor, as provided
in Article V, to the payment of any such amount due on the Notes on or after
the respective due dates thereof (or, in the case of redemption, on or after
the Redemption Date);
(ii) reduce the percentage of the Outstanding Amount of the
Notes, the consent of the Holders of which is required for any such
supplemental indenture, or the consent of the Holders of which is required for
any waiver of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences provided for in this Indenture;
(iii) reduce the percentage of the Outstanding Amount of the
Notes required to direct the Indenture Trustee to direct the Issuer to sell or
liquidate the Trust Estate pursuant to Section 5.04;
(iv) modify any provision of this Section except to increase any
percentage specified herein or to provide that certain additional provisions
of this Indenture or the Basic Documents cannot be modified or waived without
the consent of the Holder of each Outstanding Note affected thereby;
(v) modify any of the provisions of this Indenture in such
manner as to affect the calculation of the amount of any payment of interest
or principal due on any Note on any Distribution Date (including the
calculation of any of the individual components of such calculation) or to
affect the rights of the Holders of Notes to the benefit of any provisions for
the mandatory redemption of the Notes contained herein; or
(vi) 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 provided by the lien of this Indenture.
The Indenture Trustee may in its discretion or at the advice of counsel
determine whether or not any Notes would be affected by any supplemental
indenture and any such determination shall be conclusive upon the Holders of
all Notes, whether theretofore or thereafter authenticated and delivered
hereunder. The Indenture Trustee shall not be liable for any such
determination made in good faith.
It shall not be necessary for any Act of Noteholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Indenture Trustee
of any supplemental indenture pursuant to this Section, the Indenture Trustee
shall mail to the Holders of the Notes to which such amendment or supplemental
indenture relates a notice setting forth in general terms the substance of
such supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
Section 9.03. Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modification thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled to receive, and
subject to Sections 6.01 and 6.02, shall be fully protected in relying upon,
an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Indenture Trustee
may, but shall not be obligated to, enter into any such supplemental indenture
that affects the Indenture Trustee's own rights, duties, liabilities or
immunities under this Indenture or otherwise. The Administrator shall provide
a fully executed copy of any supplemental indentures to this Indenture to each
Rating Agency.
Section 9.04. Effect of Supplemental Indenture. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and shall be deemed to be modified and amended in accordance therewith with
respect to the Notes affected thereby, and the respective rights, limitations
of rights, obligations, duties, liabilities and immunities under this
Indenture of the Indenture Trustee, the Issuer and the Holders of the Notes
shall thereafter be determined, exercised and enforced hereunder subject in
all respects to such modifications and amendments, and all the terms and
conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.
Section 9.05. 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.
Section 9.06. Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as
then in effect so long as this Indenture shall then be qualified under the
Trust Indenture Act.
ARTICLE X.
REDEMPTION OF NOTES
Section 10.01. Redemption. The Notes are subject to redemption in whole,
but not in part, at the direction of the Servicer pursuant to Section 9.01 of
the Sale and Servicing Agreement, on any Distribution Date on which the
Servicer exercises its option to purchase the Trust Estate pursuant to said
Section 9.01, for a purchase price equal to the Redemption Price; provided,
that the Issuer has available funds sufficient to pay the Redemption Price.
The Servicer or the Issuer shall furnish the Rating Agencies and the Indenture
Trustee notice of such redemption. If the Notes are to be redeemed pursuant to
this Section 10.01, the Servicer shall furnish notice of such election to the
Indenture Trustee not later than 20 days prior to the Redemption Date and
shall deposit the Business Day prior to the Redemption Date with the Indenture
Trustee in the Note Distribution Account the Redemption Price of the Notes to
be redeemed, whereupon all such Notes shall be due and payable on the
Redemption Date upon the furnishing of a notice complying with Section 10.02
to each Holder of the Notes.
Section 10.02. Form of Redemption Notice. Notice of redemption under
Section 10.01 shall be given by the Indenture Trustee by first-class mail,
postage prepaid, or by facsimile mailed or transmitted not later than 10 days
prior to the applicable Redemption Date to each Holder of Notes, as of the
close of business on the Record Date preceding the applicable Redemption Date,
at such Holder's address or facsimile number appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the place where such Notes are to be surrendered for payment of
the Redemption Price (which shall be the office or agency of the Issuer to be
maintained as provided in Section 3.02); and
(iv) that interest on the Notes shall cease to accrue on the
Redemption Date.
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.
Section 10.03. Notes Payable on Redemption Date. The Notes or portions
thereof to be redeemed shall, following notice of redemption as required by
Section 10.02 (in the case of redemption pursuant to Section 10.01), on the
Redemption Date become due and payable at the Redemption Price and (unless the
Issuer shall default in the payment of the Redemption Price) no interest shall
accrue on the Redemption Price for any period after the date to which accrued
interest is calculated for purposes of calculating the Redemption Price.
ARTICLE XI.
MISCELLANEOUS
Section 11.01. Compliance Certificates and Opinions, etc.
(a) Upon any application or request by the Issuer to the Indenture
Trustee to take any action under any provision of this Indenture, the Issuer
shall furnish to the Indenture Trustee (i) an Officer's Certificate stating
that all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with and (ii) an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if
any, have been complied with and (iii) (if required by the TIA) an Independent
Certificate from a firm of certified public accountants meeting the applicable
requirements of this Section, except that, in the case of any such application
or request as to which the furnishing of such documents is specifically
required by any provision of this Indenture, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition and the
definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained
in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is necessary to
enable such signatory to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture,
the Issuer shall, in addition to any obligation imposed in Section 11.01(a) or
elsewhere in this Indenture, furnish to the Indenture Trustee an Officer's
Certificate certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days of such deposit) to the
Issuer of the Collateral or other property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the Indenture
Trustee an Officer's Certificate certifying or stating the opinion of any
signer thereof as to the matters described in clause (i) above, the Issuer
shall also deliver to the Indenture Trustee an Independent Certificate as to
the same matters, if the fair value to the Issuer of the 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 (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 Officer's Certificate is less than $25,000 or less than one
percent of the Outstanding Amount of the Notes.
(iii) Whenever any property or securities are to be released
from the lien of this Indenture, the Issuer shall also furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the opinion
of each person signing such certificate as to the fair value (within 90 days
of such release) of the property or securities proposed to be released and
stating that in the opinion of such person the proposed release will not
impair the security under this Indenture in contravention of the provisions
hereof.
(iv) Other than with respect to the release of any Purchased
Receivable, the Issuer is required to furnish to the Indenture Trustee an
Officer's Certificate certifying or stating the opinion of any signer thereof
as to the matters described in clause (iii) above, the Issuer shall also
furnish to the Indenture Trustee an Independent Certificate as to the same
matters if the fair value of the property or securities and of all other
property, other than property as contemplated by clause (v) below, or
securities released from the lien of this Indenture since the commencement of
the then-current calendar year, as set forth in the certificates required by
clause (iii) above and this clause (iv), equals 10% or more of the Outstanding
Amount of the Notes, but such certificate need not be furnished in the case of
any release of property or securities if the fair value thereof as set forth
in the related Officer's Certificate is less than $25,000 or less than one
percent of the then Outstanding Amount of the Notes.
(v) Notwithstanding Section 4.04 or any other provision of this
Section, the Issuer may, without compliance with the requirements of the other
provisions of this Section, (A) collect, liquidate, sell or otherwise dispose
of Receivables and Financed Vehicles as and to the extent permitted or
required by the Basic Documents and (B) make cash payments out of the Trust
Accounts as and to the extent permitted or required by the Basic Documents.
Section 11.02. Form of Documents Delivered to Indenture Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters and one or more other
such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion
or representations with respect to the matters upon which such officer's
certificate or opinion is based are erroneous. Any such certificate of an
Authorized Officer or Opinion of Counsel may be based, insofar as it relates
to factual matters, upon a certificate or opinion of, or representations by,
an officer or officers of the Servicer, either Seller, the Issuer or the
Administrator, stating that the information with respect to such factual
matters is in the possession of the Servicer, the applicable Seller, 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.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application
or at the effective date of such certificate or report (as the case may be),
of the facts and opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such application
granted or to the sufficiency of such certificate or report. The foregoing
shall not, however, be construed to affect the Indenture Trustee's right to
rely upon the truth and accuracy of any statement or opinion contained in any
such document as provided in Article VI.
Section 11.03. Acts of Noteholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided
such action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee and, where it is hereby expressly required,
to the Issuer. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Noteholders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 6.01) conclusive in
favor of the Indenture Trustee and the Issuer, if made in the manner provided
in this Section.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Notes shall bind the Holder of
every Note issued upon the registration thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by
the Indenture Trustee or the Issuer in reliance thereon, whether or not
notation of such action is made upon such Note.
Section 11.04. Notices, etc., to Indenture Trustee, Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent,
waiver or Act of Noteholders or other documents provided or permitted by this
Indenture shall be in writing and, if such request, demand, authorization,
direction, notice, consent, waiver or act of Noteholders is to be made upon,
given or furnished to or filed with:
(i) the Indenture Trustee by any Noteholder or by the Issuer,
shall be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Indenture Trustee at its Corporate Trust
Office; or
(ii) the Issuer by the Indenture Trustee or by any Noteholder,
shall be sufficient for every purpose hereunder if in writing and mailed
first-class, postage prepaid to the Issuer addressed to: BMW Vehicle Owner
Trust 1999-A, in care of Wilmington Trust Company, as Owner Trustee, Rodney
Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001,
Attention: Corporate Trust Administration, or at any other address previously
furnished in writing to the Indenture Trustee by the Issuer or the
Administrator. The Issuer shall promptly transmit any notice received by it
from the Noteholders to the Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuer,
the Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered or mailed by certified mail, return receipt requested, to (i) in the
case of Moody's, at the following address: Moody's Investors Service, Inc.,
ABS Monitoring Department, 99 Church Street, New York, New York 10007 and (ii)
in the case of Standard & Poor's, at the following address: Standard & Poor's,
a division of The McGraw-Hill Companies, Inc., 55 Water Street, New York, New
York 10041, Attention of Asset Backed Surveillance Department; or as to each
of the foregoing, at such other address as shall be designated by written
notice to the other parties.
Section 11.05. Notices to Noteholders; Waiver. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at such Holder's address as it appears on the Note Register, not later
than the latest date, and not earlier than the earliest date, prescribed for
the giving of such notice. In any case where notice to Noteholders is given by
mail, neither the failure to mail such notice nor any defect in any notice so
mailed to any particular Noteholder shall affect the sufficiency of such
notice with respect to other Noteholders, and any notice that is mailed in the
manner herein provided shall conclusively be presumed to have been duly given.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Noteholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Indenture Trustee shall be deemed
to be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute a Default
or Event of Default.
Section 11.06. Alternate Payment and Notice Provisions. Notwithstanding
any provision of this Indenture or any of the Notes to the contrary, the
Issuer may enter into any agreement with any Holder of a Note providing for a
method of payment, or notice by the Indenture Trustee or any Paying Agent to
such Holder, that is different from the methods provided for in this Indenture
for such payments or notices. The Issuer will furnish to the Indenture Trustee
a copy of each such agreement and the Indenture Trustee will cause payments to
be made and notices to be given in accordance with such agreements. The
Indenture Trustee shall provide a copy of any request made pursuant to this
Section 11.06 to the Owner Trustee.
Section 11.07. 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 11.08. Successors and Assigns. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Indenture Trustee
in this Indenture shall bind its successors, co-trustees and agents.
Section 11.09. 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 11.10. Benefits of Indenture. Nothing in this Indenture or in the
Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, and the Noteholders, and any other
party secured hereunder, and any other Person with an ownership interest in
any part of the Trust Estate, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
Section 11.11. Legal Holidays. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the date on which nominally due, and no interest
shall accrue for the period from and after any such nominal date.
Section 11.12. GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.13. 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 11.14. 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 the expense of the Servicer 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 11.15. Trust Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee
or the Indenture Trustee on the Notes or under this Indenture or any
certificate or other writing delivered in connection herewith or therewith,
against (i) the Indenture Trustee or the Owner Trustee in its individual
capacity, (ii) any owner of a beneficial interest in the Issuer, including the
Seller, or (iii) any partner, owner, beneficiary, agent, officer, director,
employee or agent 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 have no such obligations in their
individual capacity). For all purposes of this Indenture, in the performance
of any duties or obligations of the Issuer hereunder, the Owner Trustee shall
be subject to, and entitled to the benefits of, the terms and provisions of
Article VI, VII and VIII of the Trust Agreement.
Section 11.16. No Petition. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time institute against the Issuer or the Depositor,
or join in any institution against the Issuer or the Depositor, of any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law in connection with any obligations relating to the
Notes, this Indenture or any of the Basic Documents.
Section 11.17. Inspection. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Indenture Trustee, during the
Issuer's normal business hours, to examine all the books of account, records,
reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees and Independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested; provided,
however, that the Indenture Trustee may only cause the books of the Issuer to
be audited on an annual basis, unless there occurs an Event of Default
hereunder. The Indenture Trustee shall, and shall cause its representatives
to, hold in confidence all such information except to the extent such
information is publicly available or such 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
with the advice of counsel and after consultation with the Issuer that such
disclosure is consistent with its obligations hereunder.
Section 11.18. Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof that is required
to be included in this Indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control.
The provisions of TIA 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 11.19. Limitation of Liability. It is expressly understood and
agreed by the parties hereto that (a) this Indenture is executed and delivered
by Wilmington Trust Company, not individually or personally but solely as
Owner Trustee of BMW Vehicle Owner Trust 1999-A, in the exercise of the powers
and authority conferred and vested in it, (b) each of the representations,
undertakings and agreements herein made on the part of the Issuer is made and
intended not as personal representations, undertakings and agreements by
Wilmington Trust Company but is made and intended for the purpose for binding
only the Issuer, (c) nothing herein contained shall be construed as creating
any liability on Wilmington Trust Company, individually or personally, to
perform any covenant either expressed or implied contained herein, all such
liability, if any, being expressly waived by the parties hereto and by any
Person claiming by, through or under the parties hereto and (d) under no
circumstances shall Wilmington Trust Company be personally liable for the
payment of any indebtedness or expenses of the Issuer or be liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Issuer under this Indenture or any other related
documents.
* * * * *
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused
this Indenture to be duly executed by their respective officers, thereunto
duly authorized and duly attested, all as of the day and year first above
written.
BMW VEHICLE OWNER TRUST 1999-A,
by: WILMINGTON TRUST COMPANY, not in its individual
capacity but solely as Owner Trustee,
by:__________________________________________________
Name:
Title:
THE CHASE MANHATTAN BANK, not in its individual
capacity but solely as Indenture Trustee,
by:__________________________________________________
Name:
Title:
STATE OF NEW YORK }
} ss.:
COUNTY OF NEW YORK }
BEFORE ME, the undersigned authority, a Notary Public in and for said
county and state, on this day personally appeared _________________, a
_________________ of Wilmington Trust Company, not in its individual capacity
but solely as Owner Trustee of BMW Vehicle Owner Trust 1999-A, a Delaware
Business Trust (the "Trust") known to me to be the person and officer whose
name is subscribed to the foregoing instrument and acknowledged to me that the
same was the act of the said Trust, and that s/he executed the same as the act
of said business trust for the purpose and consideration therein expressed,
and in the capacities therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this _____ day of September,
1999.
-----------------------------------------------
Notary Public in and for the State of New York
My commission expires:
- ----------------------------------------------
STATE OF NEW YORK }
} ss.:
COUNTY OF NEW YORK }
BEFORE ME, the undersigned authority, a Notary Public in and for said
county and state, on this day personally appeared _________________, known to
me to be the person and officer whose name is subscribed to the foregoing
instrument and acknowledged to me that the same was the act of THE CHASE
MANHATTAN BANK, a New York banking corporation, and that s/he executed the
same as the act of said corporation for the purpose and consideration therein
stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this _____ day of September, 1999.
-----------------------------------------------
Notary Public in and for the State of New York
My commission expires:
- ----------------------------------------------
SCHEDULE A
[To be Provided on the Closing Date]
EXHIBIT A-1
[FORM OF CLASS A-1 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK,
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $ 1
-----------
No. R-_____ CUSIP NO. _________
BMW VEHICLE OWNER TRUST 1999-A
[o]% ASSET BACKED NOTE, CLASS A-1
BMW VEHICLE OWNER TRUST 1999-A, a business trust organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to ___________________,
or registered assigns, the principal sum of __________ DOLLARS, payable on
each Distribution Date in an amount equal to the result obtained by
multiplying (i) a fraction the numerator of which is $ [INSERT INITIAL
PRINCIPAL AMOUNT OF NOTE] and the denominator of which is $________ by (ii)
the aggregate amount, if any, payable from the Note Distribution Account in
respect of principal on the Class A-1 Notes pursuant to Section 3.01 of the
Indenture dated as of September 1, 1999 (the "Indenture"), between the Issuer
and The Chase Manhattan Bank, a New York banking corporation, as Indenture
Trustee (the "Indenture Trustee"); provided, however, that the entire unpaid
principal amount of this Note shall be due and payable on [o] (the "Class A-1
Final Scheduled Distribution Date"). Capitalized terms used but not defined
herein are defined in the Indenture, which also contains rules as to
construction that shall be applicable herein.
The Issuer will pay interest on this Note at the rate per annum set
forth above, on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in Section 3.01 of the Indenture. Interest on
this Note will accrue for each Distribution Date from and including the prior
Distribution Date (in the case of the first Distribution Date, from the
Closing Date) to and including such Distribution Date. Interest will be
computed on the basis of the actual number of days in the related Interest
Accrual Period and a 360-day year. Such principal of and interest on this Note
shall be paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of
this Note.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
___________________
1 Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: BMW VEHICLE OWNER TRUST 1999-A
By: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement,
By: ________________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: THE CHASE MANHATTAN BANK, not in its
individual capacity but solely as
Indenture Trustee,
By: _________________________________
Authorized Signatory
REVERSE OF CLASS A-1 NOTE
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its Floating Rate Asset Backed Notes, Class A-1 (herein called
the "Class A-1 Notes"), all issued under the Indenture, to which Indenture and
all indentures supplemental thereto reference is hereby made for a statement
of the respective rights and obligations thereunder of the Issuer, the
Indenture Trustee and the Holders of the Notes. The Class A-1 Notes are
subject to all terms of the Indenture.
The Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4
Notes (collectively, the "Notes") are and will be secured by the collateral
pledged as security therefor as provided in the Indenture.
Principal of the Class A-1 Notes will be payable on each Distribution
Date in an amount described on the face hereof. "Distribution Date" means the
25th day of each month, or, if any such date is not a Business Day, the next
succeeding Business Day, commencing October 25, 1999.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the Class A-1 Final Scheduled Distribution Date.
Notwithstanding the foregoing, if an Event of Default occurs, the Indenture
Trustee or the Holders of Notes representing not less than a majority of the
Outstanding Amount of the Notes have declared the Notes to be immediately due
and payable in the manner provided in Section 5.02 of the Indenture. All
principal payments on the Class A-1 Notes shall be made pro rata to the Class
A-1 Noteholders entitled thereto.
Payments of interest on this Note due and payable on each
Distribution Date, together with the installment of principal, if any, to the
extent not in full payment of this Note, shall be made by check mailed to the
Person whose name appears as the Registered Holder of this Note (or one or
more Predecessor Notes) on the Note Register as of the close of business on
each Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more Predecessor
Notes) effected by any payments made on any Distribution Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not noted hereon. If funds are expected to be available, as
provided in the Indenture, for payment in full of the then remaining unpaid
principal amount of this Note on a Distribution Date, then the Indenture
Trustee, in the name of and on behalf of the Issuer, will notify the Person
who was the Registered Holder hereof as of the Record Date preceding such
Distribution Date by notice mailed or transmitted by facsimile prior to such
Distribution Date, and the amount then due and payable shall be payable only
upon presentation and surrender of this Note at the Indenture Trustee's
principal Corporate Trust Office or at the office of the Indenture Trustee's
agent appointed for such purposes located in The City of New York.
The Issuer shall pay interest on overdue installments of interest at
the Class A-1 Rate to the extent lawful.
As provided in the Indenture and subject to the limitations set forth
therein and on the face hereof, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent's Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and thereupon one or more new
Notes of authorized denominations and in the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Note, but
the transferor may be required to pay a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any such
registration of transfer or exchange subject to certain exceptions set forth
in the Indenture.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Sellers, the Servicer, the Indenture
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer, including the Sellers or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Sellers, the
Servicer, the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Sellers, the
Servicer, the Owner Trustee or the Indenture Trustee or of any successor or
assign of the Indenture Trustee or the Owner Trustee in its individual
capacity, except as any such Person may have expressly agreed and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution or failure to pay any installment or call owing to such
entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees by
accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Issuer, or join in any institution
against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings under any United States federal or state bankruptcy
or similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness of the
Issuer secured by the Trust Estate. Each Noteholder, by acceptance of a Note
(and each Note Owner by acceptance of a beneficial interest in a Note), agrees
to treat the Notes for federal, state and local income, single business and
franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note be overdue, and none of the Issuer, the Indenture Trustee or any
such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and the rights of the Holders of the Notes under the Indenture at
any time by the Issuer with the consent of the Holders of Notes representing a
majority of the Outstanding Amount of all Notes at the time Outstanding. The
Indenture also contains provisions permitting Holders of Notes representing
specified percentages of the Outstanding Amount of the Notes, on behalf of the
Holders of all the Notes, to waive compliance by the Issuer with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note (or
any one or more Predecessor Notes) shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued upon
the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note. The
Indenture also permits the Indenture Trustee to amend or waive certain terms
and conditions set forth in the Indenture without the consent of Holders of
the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of [Wilmington Trust Company in its
individual capacity], [The Chase Manhattan Bank] in its individual capacity,
any owner of a beneficial interest in the Issuer, the Sellers, the Servicer,
or any of their respective partners, beneficiaries, agents, officers,
directors, employees or successors or assigns shall be personally liable for,
nor shall recourse be had to any of them for, the payment of principal of or
interest on this Note or performance of, or omission to perform, any of the
covenants, obligations or indemnifications contained in the Indenture. The
Holder of this Note by its acceptance hereof agrees that, except as expressly
provided in the Basic Documents, in the case of an Event of Default under the
Indenture, the Holder shall have no claim against any of the foregoing for any
deficiency, loss or claim therefrom; provided, however, that nothing contained
herein shall be taken to prevent recourse to, and enforcement against, the
assets of the Issuer for any and all liabilities, obligations and undertakings
contained in the Indenture or in this Note.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
- --------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
- ------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ____________________________________________, attorney, to
transfer said Note on the books kept for registration thereof, with full power
of substitution in the premises.
Dated: */
Signature Guaranteed:
*/
- ------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatsoever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note
Registrar, which requirements include membership or participation in
STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution
for, STAMP, all in accordance with the Securities Exchange Act of
1934, as amended.
EXHIBIT A-2
[FORM OF CLASS A-2 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK,
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $_____________2
No. R-________ CUSIP NO. _________
BMW VEHICLE OWNER TRUST 1999-A
[ ]% ASSET BACKED NOTE, CLASS A-2
BMW VEHICLE OWNER TRUST 1999-A, a business trust organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to ____________________,
or registered assigns, the principal sum of __________ DOLLARS, payable on
each Distribution Date in an amount equal to the result obtained by
multiplying (i) a fraction the numerator of which is $ [INSERT INITIAL
PRINCIPAL AMOUNT OF NOTE] and the denominator of which is $_____ by (ii) the
aggregate amount, if any, payable from the Note Distribution Account in
respect of principal on the Class A-2 Notes pursuant to Section 3.01 of the
Indenture dated as of September 1, 1999 (the "Indenture"), between the Issuer
and The Chase Manhattan Bank, a New York banking corporation, as Indenture
Trustee (the "Indenture Trustee"); provided, however, that the entire unpaid
principal amount of this Note shall be due and payable on [o] (the "Class A-2
Final Scheduled Distribution Date"). No payments of principal of the Class A-2
Notes shall be made until the Class A-1 Notes have been paid in full.
Capitalized terms used but not defined herein are defined in the Indenture,
which also contains rules as to construction that shall be applicable herein.
The Issuer will pay interest on this Note at the rate per annum set
forth above, on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in the last sentence of Section 3.01 of the
Indenture. Interest on this Note will accrue for each Distribution Date from
and including the 25th day of the month preceding the month of such
Distribution Date (or, in the case of the first Distribution Date, from the
Closing Date) to but excluding the 25th day of the month of such Distribution
Date. Interest will be computed on the basis of a 360-day year of twelve
30-day months. Such principal of and interest on this Note shall be paid in
the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of
this Note.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
_____________
2 Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: BMW VEHICLE OWNER TRUST 1999-A
By: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement,
By: _________________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: THE CHASE MANHATTAN BANK, not in its
individual capacity but solely as
Indenture Trustee,
By: ___________________________________
Authorized Signatory
REVERSE OF CLASS A-2 NOTE
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its [o]% Asset Backed Notes, Class A-2 (herein called the "Class
A-2 Notes"), all issued under the Indenture, to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights and obligations thereunder of the Issuer, the Indenture
Trustee and the Holders of the Notes. The Class A-2 Notes are subject to all
terms of the Indenture.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be secured by the
collateral pledged as security therefor as provided in the Indenture.
Principal of the Class A-2 Notes will be payable on each Distribution
Date in an amount described on the face hereof only after the Class A-1 Notes
are paid in full and have no Principal Balance. "Distribution Date" means the
25th day of each month, or, if any such date is not a Business Day, the next
succeeding Business Day, commencing October 25, 1999.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the Class A-2 Final Scheduled Distribution Date.
Notwithstanding the foregoing, if an Event of Default occurs, the Indenture
Trustee or the Holders of Notes representing not less than a majority of the
Outstanding Amount of the Notes have declared the Notes to be immediately due
and payable in the manner provided in Section 5.02 of the Indenture. All
principal payments on the Class A-2 Notes shall be made pro rata to the Class
A-2 Noteholders entitled thereto.
Payments of interest on this Note due and payable on each
Distribution Date, together with the installment of principal, if any, to the
extent not in full payment of this Note, shall be made by check mailed to the
Person whose name appears as the Registered Holder of this Note (or one or
more Predecessor Notes) on the Note Register as of the close of business on
each Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more Predecessor
Notes) effected by any payments made on any Distribution Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not noted hereon. If funds are expected to be available, as
provided in the Indenture, for payment in full of the then remaining unpaid
principal amount of this Note on a Distribution Date, then the Indenture
Trustee, in the name of and on behalf of the Issuer, will notify the Person
who was the Registered Holder hereof as of the Record Date preceding such
Distribution Date by notice mailed or transmitted by facsimile prior to such
Distribution Date, and the amount then due and payable shall be payable only
upon presentation and surrender of this Note at the Indenture Trustee's
principal Corporate Trust Office or at the office of the Indenture Trustee's
agent appointed for such purposes located in The City of New York.
The Issuer shall pay interest on overdue installments of interest at
the Class A-2 Rate to the extent lawful.
As provided in the Indenture and subject to the limitations set forth
therein and on the face hereof, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent's Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and thereupon one or more new
Notes of authorized denominations and in the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Note, but
the transferor may be required to pay a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any such
registration of transfer or exchange subject to certain exceptions set forth
in the Indenture.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Sellers, the Servicer, the Indenture
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer, including the Sellers or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Sellers, the
Servicer, Indenture Trustee or the Owner Trustee in its individual capacity,
any holder of a beneficial interest in the Issuer, the Sellers, the Servicer,
the Owner Trustee or the Indenture Trustee or of any successor or assign of
the Indenture Trustee or the Owner Trustee in its individual capacity, except
as any such Person may have expressly agreed and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees by
accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Issuer, or join in any institution
against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings under any United States federal or state bankruptcy
or similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness of the
Issuer secured by the Trust Estate. Each Noteholder, by acceptance of a Note
(and each Note Owner by acceptance of a beneficial interest in a Note), agrees
to treat the Notes for federal, state and local income, single business and
franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note be overdue, and none of the Issuer, the Indenture Trustee or any
such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and the rights of the Holders of the Notes under the Indenture at
any time by the Issuer with the consent of the Holders of Notes representing a
majority of the Outstanding Amount of all Notes at the time Outstanding. The
Indenture also contains provisions permitting Holders of Notes representing
specified percentages of the Outstanding Amount of the Notes, on behalf of the
Holders of all the Notes, to waive compliance by the Issuer with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note (or
any one or more Predecessor Notes) shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued upon
the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note. The
Indenture also permits the Indenture Trustee to amend or waive certain terms
and conditions set forth in the Indenture without the consent of Holders of
the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of [Wilmington Trust Company in its
individual capacity], [The Chase Manhattan Bank] in its individual capacity,
any owner of a beneficial interest in the Issuer, the Sellers, the Servicer,
or any of their respective partners, beneficiaries, agents, officers,
directors, employees or successors or assigns shall be personally liable for,
nor shall recourse be had to any of them for, the payment of principal of or
interest on this Note or performance of, or omission to perform, any of the
covenants, obligations or indemnifications contained in the Indenture. The
Holder of this Note by its acceptance hereof agrees that, except as expressly
provided in the Basic Documents, in the case of an Event of Default under the
Indenture, the Holder shall have no claim against any of the foregoing for any
deficiency, loss or claim therefrom; provided, however, that nothing contained
herein shall be taken to prevent recourse to, and enforcement against, the
assets of the Issuer for any and all liabilities, obligations and undertakings
contained in the Indenture or in this Note.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
- --------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
- ------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ____________________________________________, attorney, to
transfer said Note on the books kept for registration thereof, with full power
of substitution in the premises.
Dated: */
Signature Guaranteed:
*/
- ------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatsoever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note
Registrar, which requirements include membership or participation in
STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution
for, STAMP, all in accordance with the Securities Exchange Act of
1934, as amended.
[FORM OF CLASS A-3 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK,
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $_____________3
No. R-________ CUSIP NO. _________
BMW VEHICLE OWNER TRUST 1999-A
[o]% ASSET BACKED NOTE, CLASS A-3
BMW VEHICLE OWNER TRUST 1999-A, a business trust organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to ____________________,
or registered assigns, the principal sum of __________ DOLLARS, payable on
each Distribution Date in an amount equal to the result obtained by
multiplying (i) a fraction the numerator of which is $ [INSERT INITIAL
PRINCIPAL AMOUNT OF NOTE] and the denominator of which is $_____ by (ii) the
aggregate amount, if any, payable from the Note Distribution Account in
respect of principal on the Class A-3 Notes pursuant to Section 3.01 of the
Indenture dated as of September 1, 1999 (the "Indenture"), between the Issuer
and The Chase Manhattan Bank, a New York banking corporation, as Indenture
Trustee (the "Indenture Trustee"); provided, however, that the entire unpaid
principal amount of this Note shall be due and payable on [o] (the "Class A-3
Final Scheduled Distribution Date"). No payments of principal of the Class A-3
Notes shall be made until the Class A-1 Notes and the Class A-2 Notes have
been paid in full. Capitalized terms used but not defined herein are defined
in the Indenture, which also contains rules as to construction that shall be
applicable herein.
The Issuer will pay interest on this Note at the rate per annum set
forth above, on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in Section 3.01 of the Indenture. Interest on
this Note will accrue for each Distribution Date from and including the 25th
day of the month preceding the month of such Distribution Date (in the case of
the first Distribution Date, from the Closing Date) to but excluding the 25th
day of the month of such Distribution Date. Interest will be computed on the
basis of a 360-day year of twelve 30-day months. Such principal of and
interest on this Note shall be paid in the manner specified on the reverse
hereof.
The principal of and interest on this Note are payable in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of
this Note.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
_______________
3 Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: BMW VEHICLE OWNER TRUST 1999-A
By: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement,
By: ________________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: [THE CHASE MANHATTAN BANK], not in its
individual capacity but solely as
Indenture Trustee,
By: _________________________________
Authorized Signatory
REVERSE OF CLASS A-3 NOTE
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its [o]% Asset Backed Notes, Class A-3 (herein called the "Class
A-3 Notes"), all issued under the Indenture, to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights and obligations thereunder of the Issuer, the Indenture
Trustee and the Holders of the Notes. The Class A-3 Notes are subject to all
terms of the Indenture.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be secured by the
collateral pledged as security therefor as provided in the Indenture.
Principal of the Class A-3 Notes will be payable on each Distribution
Date in an amount described on the face hereof only after the Class A-1 Notes
and the Class A-2 Notes are paid in full and have no Principal Balance.
"Distribution Date" means the 25th day of each month, or, if any such date is
not a Business Day, the next succeeding Business Day, commencing October 15,
1999.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the Class A-3 Final Scheduled Distribution Date.
Notwithstanding the foregoing, if an Event of Default occurs, the Indenture
Trustee or the Holders of Notes representing not less than a majority of the
Outstanding Amount of the Notes have declared the Notes to be immediately due
and payable in the manner provided in Section 5.02 of the Indenture. All
principal payments on the Class A-3 Notes shall be made pro rata to the Class
A-3 Noteholders entitled thereto.
Payments of interest on this Note due and payable on each
Distribution Date, together with the installment of principal, if any, to the
extent not in full payment of this Note, shall be made by check mailed to the
Person whose name appears as the Registered Holder of this Note (or one or
more Predecessor Notes) on the Note Register as of the close of business on
each Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more Predecessor
Notes) effected by any payments made on any Distribution Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not noted hereon. If funds are expected to be available, as
provided in the Indenture, for payment in full of the then remaining unpaid
principal amount of this Note on a Distribution Date, then the Indenture
Trustee, in the name of and on behalf of the Issuer, will notify the Person
who was the Registered Holder hereof as of the Record Date preceding such
Distribution Date by notice mailed or transmitted by facsimile prior to such
Distribution Date, and the amount then due and payable shall be payable only
upon presentation and surrender of this Note at the Indenture Trustee's
principal Corporate Trust Office or at the office of the Indenture Trustee's
agent appointed for such purposes located in The City of New York.
The Issuer shall pay interest on overdue installments of interest at
the Class A-3 Rate to the extent lawful.
As provided in the Indenture and subject to the limitations set forth
therein and on the face hereof, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent's Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and thereupon one or more new
Notes of authorized denominations and in the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Note, but
the transferor may be required to pay a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any such
registration of transfer or exchange subject to certain exceptions set forth
in the Indenture.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Sellers, the Servicer, the Indenture
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer, including the Sellers or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Sellers, the
Servicer, Indenture Trustee or the Owner Trustee in its individual capacity,
any holder of a beneficial interest in the Issuer, the Sellers, the Servicer,
the Owner Trustee or the Indenture Trustee or of any successor or assign of
the Indenture Trustee or the Owner Trustee in its individual capacity, except
as any such Person may have expressly agreed and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees by
accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Issuer, or join in any institution
against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings under any United States federal or state bankruptcy
or similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness of the
Issuer secured by the Trust Estate. Each Noteholder, by acceptance of a Note
(and each Note Owner by acceptance of a beneficial interest in a Note), agrees
to treat the Notes for federal, state and local income, single business and
franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note be overdue, and none of the Issuer, the Indenture Trustee or any
such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and the rights of the Holders of the Notes under the Indenture at
any time by the Issuer with the consent of the Holders of Notes representing a
majority of the Outstanding Amount of all Notes at the time Outstanding. The
Indenture also contains provisions permitting Holders of Notes representing
specified percentages of the Outstanding Amount of the Notes, on behalf of the
Holders of all the Notes, to waive compliance by the Issuer with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note (or
any one or more Predecessor Notes) shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued upon
the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note. The
Indenture also permits the Indenture Trustee to amend or waive certain terms
and conditions set forth in the Indenture without the consent of Holders of
the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of [Wilmington Trust Company in its
individual capacity], [The Chase Manhattan Bank] in its individual capacity,
any owner of a beneficial interest in the Issuer, the Sellers, the Servicer,
or any of their respective partners, beneficiaries, agents, officers,
directors, employees or successors or assigns shall be personally liable for,
nor shall recourse be had to any of them for, the payment of principal of or
interest on this Note or performance of, or omission to perform, any of the
covenants, obligations or indemnifications contained in the Indenture. The
Holder of this Note by its acceptance hereof agrees that, except as expressly
provided in the Basic Documents, in the case of an Event of Default under the
Indenture, the Holder shall have no claim against any of the foregoing for any
deficiency, loss or claim therefrom; provided, however, that nothing contained
herein shall be taken to prevent recourse to, and enforcement against, the
assets of the Issuer for any and all liabilities, obligations and undertakings
contained in the Indenture or in this Note.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
- --------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
- ------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ____________________________________________, attorney, to
transfer said Note on the books kept for registration thereof, with full power
of substitution in the premises.
Dated: */
Signature Guaranteed:
*/
- ------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatsoever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note
Registrar, which requirements include membership or participation in
STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution
for, STAMP, all in accordance with the Securities Exchange Act of
1934, as amended.
EXHIBIT A-4
[FORM OF CLASS A-4 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK,
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $_____________4
No. R-________ CUSIP NO. _________
BMW VEHICLE OWNER TRUST 1999-A
[o]% ASSET BACKED NOTE, CLASS A-4
BMW VEHICLE OWNER TRUST 1999-A, a business trust organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to ____________________,
or registered assigns, the principal sum of __________ DOLLARS, payable on
each Distribution Date in an amount equal to the result obtained by
multiplying (i) a fraction the numerator of which is $ [INSERT INITIAL
PRINCIPAL AMOUNT OF NOTE] and the denominator of which is $_____ by (ii) the
aggregate amount, if any, payable from the Note Distribution Account in
respect of principal on the Class A-3 Notes pursuant to Section 3.01 of the
Indenture dated as of September 1, 1999 (the "Indenture"), between the Issuer
and The Chase Manhattan Bank, a New York banking corporation, as Indenture
Trustee (the "Indenture Trustee"); provided, however, that the entire unpaid
principal amount of this Note shall be due and payable on the earlier of [o]
(the "Class A-3 Final Scheduled Distribution Date") and the Redemption Date,
if any, pursuant to Section 10.01 of the Indenture. No payments of principal
of the Class A-4 Notes shall be made until the Class A-1 Notes, the Class A-2
Notes and the Class A-3 Notes have been paid in full. Capitalized terms used
but not defined herein are defined in the Indenture, which also contains rules
as to construction that shall be applicable herein.
The Issuer will pay interest on this Note at the rate per annum set
forth above, on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in Section 3.01 of the Indenture. Interest on
this Note will accrue for each Distribution Date from and including the 25th
day of the month preceding the month of such Distribution Date (in the case of
the first Distribution Date, from the Closing Date) to but excluding the 25th
day of the month of such Distribution Date. Interest will be computed on the
basis of a 360-day year of twelve 30-day months. Such principal of and
interest on this Note shall be paid in the manner specified on the reverse
hereof.
The principal of and interest on this Note are payable in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of
this Note.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
______________
4 Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this Note
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: BMW VEHICLE OWNER TRUST 1999-A
By: [WILMINGTON TRUST COMPANY], not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement,
By: ________________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
Date: THE CHASE MANHATTAN BANK, not in its
individual capacity but solely as
Indenture Trustee,
By: _________________________________
Authorized Signatory
REVERSE OF CLASS A-4 NOTE
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its [o]% Asset Backed Notes, Class A-4 (herein called the "Class
A-4 Notes"), all issued under the Indenture, to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights and obligations thereunder of the Issuer, the Indenture
Trustee and the Holders of the Notes. The Class A-4 Notes are subject to all
terms of the Indenture.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be secured by the
collateral pledged as security therefor as provided in the Indenture.
Principal of the Class A-4 Notes will be payable on each Distribution
Date in an amount described on the face hereof only after the Class A-1 Notes,
the Class A-2 Notes and the Class A-3 Notes are paid in full and have no
Principal Balance. "Distribution Date" means the 25th day of each month, or,
if any such date is not a Business Day, the next succeeding Business Day,
commencing October 25, 1999.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the earlier of the Class A-4 Final Scheduled
Distribution Date and the Redemption Date, if any, pursuant to Section 10.01
of the Indenture. Notwithstanding the foregoing, if an Event of Default
occurs, the Indenture Trustee or the Holders of Notes representing not less
than a majority of the Outstanding Amount of the Notes have declared the Notes
to be immediately due and payable in the manner provided in Section 5.02 of
the Indenture. All principal payments on the Class A-4 Notes shall be made pro
rata to the Class A-4 Noteholders entitled thereto.
Payments of interest on this Note due and payable on each
Distribution Date, together with the installment of principal, if any, to the
extent not in full payment of this Note, shall be made by check mailed to the
Person whose name appears as the Registered Holder of this Note (or one or
more Predecessor Notes) on the Note Register as of the close of business on
each Record Date, except that with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such
nominee to be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Such
checks shall be mailed to the Person entitled thereto at the address of such
Person as it appears on the Note Register as of the applicable Record Date
without requiring that this Note be submitted for notation of payment. Any
reduction in the principal amount of this Note (or any one or more Predecessor
Notes) effected by any payments made on any Distribution Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not noted hereon. If funds are expected to be available, as
provided in the Indenture, for payment in full of the then remaining unpaid
principal amount of this Note on a Distribution Date, then the Indenture
Trustee, in the name of and on behalf of the Issuer, will notify the Person
who was the Registered Holder hereof as of the Record Date preceding such
Distribution Date by notice mailed or transmitted by facsimile prior to such
Distribution Date, and the amount then due and payable shall be payable only
upon presentation and surrender of this Note at the Indenture Trustee's
principal Corporate Trust Office or at the office of the Indenture Trustee's
agent appointed for such purposes located in The City of New York.
The Issuer shall pay interest on overdue installments of interest at
the Class A-4 Rate to the extent lawful.
As provided in Section 10.01 of the Indenture, the Class A-4 Notes
may be redeemed in whole, but not in part, at the option of the Servicer on
any Distribution Date on or after the date on which the Pool Balance is less
than or equal to 10% of the Initial Pool Balance.
As provided in the Indenture and subject to the limitations set forth
therein and on the face hereof, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent's Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended, and thereupon one or more new
Notes of authorized denominations and in the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Note, but
the transferor may be required to pay a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any such
registration of transfer or exchange subject to certain exceptions set forth
in the Indenture.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Sellers, the Servicer, the Indenture
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer, including the Sellers or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Sellers, the
Servicer, Indenture Trustee or the Owner Trustee in its individual capacity,
any holder of a beneficial interest in the Issuer, the Sellers, the Servicer,
the Owner Trustee or the Indenture Trustee or of any successor or assign of
the Indenture Trustee or the Owner Trustee in its individual capacity, except
as any such Person may have expressly agreed and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees by
accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Issuer, or join in any institution
against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings under any United States federal or state bankruptcy
or similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is issued
with the intention that, for federal, state and local income, single business
and franchise tax purposes, the Notes will qualify as indebtedness of the
Issuer secured by the Trust Estate. Each Noteholder, by acceptance of a Note
(and each Note Owner by acceptance of a beneficial interest in a Note), agrees
to treat the Notes for federal, state and local income, single business and
franchise tax purposes as indebtedness of the Issuer.
Prior to the due presentment for registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not
this Note be overdue, and none of the Issuer, the Indenture Trustee or any
such agent shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Issuer and the rights of the Holders of the Notes under the Indenture at
any time by the Issuer with the consent of the Holders of Notes representing a
majority of the Outstanding Amount of all Notes at the time Outstanding. The
Indenture also contains provisions permitting Holders of Notes representing
specified percentages of the Outstanding Amount of the Notes, on behalf of the
Holders of all the Notes, to waive compliance by the Issuer with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note (or
any one or more Predecessor Notes) shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued upon
the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note. The
Indenture also permits the Indenture Trustee to amend or waive certain terms
and conditions set forth in the Indenture without the consent of Holders of
the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.
The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.
This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of [Wilmington Trust Company in its
individual capacity], [The Chase Manhattan Bank] in its individual capacity,
any owner of a beneficial interest in the Issuer, the Sellers, the Servicer,
or any of their respective partners, beneficiaries, agents, officers,
directors, employees or successors or assigns shall be personally liable for,
nor shall recourse be had to any of them for, the payment of principal of or
interest on this Note or performance of, or omission to perform, any of the
covenants, obligations or indemnifications contained in the Indenture. The
Holder of this Note by its acceptance hereof agrees that, except as expressly
provided in the Basic Documents, in the case of an Event of Default under the
Indenture, the Holder shall have no claim against any of the foregoing for any
deficiency, loss or claim therefrom; provided, however, that nothing contained
herein shall be taken to prevent recourse to, and enforcement against, the
assets of the Issuer for any and all liabilities, obligations and undertakings
contained in the Indenture or in this Note.
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
- --------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
- ------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ____________________________________________, attorney, to
transfer said Note on the books kept for registration thereof, with full power
of substitution in the premises.
Dated: */
Signature Guaranteed:
*/
- ------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatsoever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note
Registrar, which requirements include membership or participation in
STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution
for, STAMP, all in accordance with the Securities Exchange Act of
1934, as amended.
EXHIBIT B
FORM OF NOTE DEPOSITORY AGREEMENT
Exhibit 4.2
EXECUTION COPY
===============================================================================
AMENDED AND RESTATED TRUST AGREEMENT
between
SSB VEHICLE SECURITIES INC.,
as Depositor,
and
WILMINGTON TRUST COMPANY,
as Owner Trustee
Dated as of September 1, 1999
===============================================================================
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Section 1.01. Capitalized Terms..............................................1
Section 1.02. Other Definitional Provisions..................................4
ARTICLE II
ORGANIZATION
Section 2.01. Name. 5
Section 2.02. Office..........................................................5
Section 2.03. Purposes and Powers.............................................5
Section 2.04. Appointment of Owner Trustee....................................6
Section 2.05. Initial Capital Contribution of Trust Estate....................6
Section 2.06. Declaration of Trust............................................6
Section 2.07. [Reserved]......................................................6
Section 2.08. Title to Trust Property.........................................6
Section 2.09. Situs of Trust..................................................6
Section 2.10. Representations, Warranties and Covenants of the Depositor......7
Section 2.11. Federal Income Tax Allocations..................................8
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership...............................................8
Section 3.02. The Trust Certificates..........................................8
Section 3.03. Execution, Authentication and Delivery of Trust Certificates....9
Section 3.04. Registration of Transfer and Exchange of Trust Certificates.....9
Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust Certificates........10
Section 3.06. Persons Deemed Owners..........................................10
Section 3.07. Access to List of Certificateholders'Names and Addresses.......10
Section 3.08. Maintenance of Office or Agency................................11
Section 3.09. Appointment of Paying Agent....................................11
Section 3.10. Book-Entry Trust Certificates...................................12
Section 3.11 Notices to Clearing Agency......................................12
Section 3.12 Definitive Trust Certificates...................................13
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice with Respect to Certain Matters...................13
Section 4.02. Action by Certificateholders with Respect to Certain Matters...15
Section 4.03. Action by Certificateholders with Respect to Bankruptcy........15
Section 4.04. Restrictions on Certificateholders'Power.......................16
Section 4.05. Majority Control...............................................16
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Establishment of Trust Account.................................16
Section 5.02. Application of Trust Funds.....................................16
Section 5.03. Method of Payment..............................................18
Section 5.04. [Reserved].....................................................18
Section 5.05. Accounting and Reports to Certificateholders, the Internal Re..18
Section 5.06. Signature on Returns; Tax Matters Partner......................18
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER
Section 6.01. General Authority..............................................19
Section 6.02. General Duties.................................................19
Section 6.03. Action upon Instruction........................................19
Section 6.04. No Duties Except as Specified in this Agreement or
in Instructions................................................20
Section 6.05. No Action Except Under Specified Documents or Instructions.....21
Section 6.06. Restrictions...................................................21
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties................................21
Section 7.02. Furnishing of Documents........................................22
Section 7.03. Representations and Warranties.................................22
Section 7.04. Reliance; Advice of Counsel....................................23
Section 7.05. Not Acting in Individual Capacity..............................23
Section 7.06. Owner Trustee Not Liable for Trust Certificates or for
Receivables....................................................24
Section 7.07. Owner Trustee May Own Trust Certificates and Notes.............24
Section 7.08. Doing Business in Other Jurisdictions..........................24
Section 7.09. Paying Agent; Authenticating Agent.............................25
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Fees and Expenses..............................25
Section 8.02. Indemnification................................................25
Section 8.03. Payments to the Owner Trustee..................................25
ARTICLE IX
TERMINATION OF TRUST AGREEMENT 26
Section 9.01. Termination of Trust Agreement.................................26
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee....................27
Section 10.02. Resignation or Removal of Owner Trustee.......................27
Section 10.03. Successor Owner Trustee.......................................28
Section 10.04. Merger or Consolidation of Owner Trustee......................28
Section 10.05. Appointment of Co-Trustee or Separate Trustee.................29
ARTICLE XI
MISCELLANEOUS
Section 11.01. Supplements and Amendments....................................30
Section 11.02. No Legal Title to Trust Estate in Certificateholders..........31
Section 11.03. Limitations on Rights of Others...............................31
Section 11.04. Notices.......................................................31
Section 11.05. Severability..................................................32
Section 11.06. Separate Counterparts.........................................32
Section 11.07. Successors and Assigns........................................32
Section 11.08. Covenants of the Depositor....................................32
Section 11.09. No Petition...................................................32
Section 11.10. No Recourse...................................................32
Section 11.11. Headings......................................................33
Section 11.12. GOVERNING LAW.................................................33
Section 11.13. Trust Certificate Transfer Restrictions.......................33
Section 11.14. Third Party Beneficiary.......................................33
Exhibit A Form of Trust Certificate..................................A-1
Exhibit B Form of Certificate of Trust...............................B-1
<PAGE>
This AMENDED AND RESTATED TRUST AGREEMENT, dated as of September __,
1999, is between SSB VEHICLE SECURITIES INC., a Delaware corporation, as
depositor (the "Depositor"), and WILMINGTON TRUST COMPANY, a Delaware banking
corporation, as owner trustee (the "Owner Trustee").
NOW, THEREFORE, the Depositor and the Owner Trustee hereby agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.01. Capitalized Terms. For all purposes of this Agreement,
the following terms shall have the meanings set forth below:
"Administration Agreement" shall mean the Owner Trust Administration
Agreement dated as of September 1, 1999, among the Trust, BMW Financial
Services NA, Inc., as Owner Trust Administrator, and The Chase Manhattan Bank,
as Indenture Trustee.
"Agreement" shall mean this Trust Agreement, as the same may be
amended and supplemented from time to time.
"Benefit Plan" shall have the meaning assigned to such term in
Section 11.13.
"Book-Entry Trust Certificate" shall mean a beneficial interest in
the Trust Certificates, the ownership and transfer of which shall be made
through book-entries by a Clearing Agency as described in Section 3.10.
"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 Balance" shall mean the Initial Certificate Balance
reduced by all amounts allocable to principal previously distributed to
Certificateholders.
"Certificate Depository Agreement" shall mean the agreement dated
September 22, 1999, among the Trust, the Owner Trustee, the Owner Trust
Administrator and The Depository Trust Company, as the initial Clearing
Agency, substantially in the form attached hereto as Exhibit E, relating to
the Trust Certificates, as the same may be amended and supplemented from time
to time.
"Certificate Distribution Account" shall have the meaning assigned to
such term in Section 5.01.
"Certificate of Trust" shall mean the Certificate of Trust
substantially in the form of Exhibit B filed for the Trust pursuant to Section
3810(a) of the Business Trust Statute.
"Certificate Owner" shall mean, with respect to a Book-Entry Trust
Certificate, a Person who is the beneficial owner of such Book-Entry Trust
Certificate, as reflected on the books of the Clearing Agency or on the books
of a Person maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
"Certificate Register" and "Certificate Registrar" shall mean the
register mentioned in and the registrar appointed pursuant to Section 3.04.
"Certificateholder" or "Holder" shall mean a Person in whose name a
Trust Certificate is registered.
"Class A-1 Notes" shall mean the 5.64% Asset Backed Notes, Class A-1,
issued pursuant to the Indenture.
"Class A-2 Notes" shall mean the 6.16% Asset Backed Notes, Class A-2,
issued pursuant to the Indenture.
"Class A-3 Notes" shall mean the 6.41% Asset Backed Notes, Class A-3,
issued pursuant to the Indenture.
"Class A-4 Notes" shall mean the 6.54% Asset Backed Notes, Class A-4,
issued pursuant to the Indenture.
"Clearing Agency" shall mean an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act.
"Clearing Agency Participant" shall mean a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities
deposited with the Clearing Agency.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
the Treasury Regulations promulgated thereunder.
"Corporate Trust Office" shall mean, with respect to the Owner
Trustee, the principal corporate trust office of the Owner Trustee located at
Rodney Square North, 1100 North Market Street, Wilmington, Delaware
19890-0001, Attention: Corporate Trust Administration, or at such other
address in the State of Delaware as the Owner Trustee may designate by notice
to the Certificateholders and the Depositor, or the principal corporate trust
office of any successor Owner Trustee at the address (which shall be in the
State of Delaware) designated by such successor Owner Trustee by notice to the
Certificateholders and the Depositor.
"Definitive Trust Certificates" shall have the meaning set forth in
Section 3.10.
"Depositor" shall mean SSB Vehicle Securities Inc., and its
successors, in its capacity as depositor hereunder.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Expenses" shall have the meaning assigned to such term in Section
8.02.
"Indemnified Parties" shall have the meaning assigned to such term in
Section 8.02.
"Indenture" shall mean the Indenture, dated as of September 1, 1999
between the Trust and The Chase Manhattan Bank, as Indenture Trustee.
"Initial Certificate Balance" shall mean $33,400,000.
"Owner Trustee" shall mean Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity but solely as owner
trustee under this Agreement, and any successor Owner Trustee hereunder.
"Pass-Through Rate" shall mean 6.91% per annum.
"Paying Agent" shall mean any paying agent or co-paying agent
appointed pursuant to Section 3.09 and shall initially be The Chase Manhattan
Bank.
"Person" shall mean any individual, corporation, estate, partnership,
limited liability company, joint venture, association, joint stock company,
trust or business trust (including any beneficiary thereof), unincorporated
organization or government or any agency or political subdivision thereof.
"Record Date" shall mean, with respect to a Distribution Date, the
close of business on the day immediately preceding such Distribution Date.
"Residual Interest" shall mean the right to receive the amounts in
respect of the Trust Estate that are distributable to BMW FS Receivables
Corporation pursuant to the Sale and Servicing Agreement.
"Sale and Servicing Agreement" shall mean the Sale and Servicing
Agreement dated as of September 1, 1999, among the Trust, as issuer, the
Depositor, BMW Financial Services NA, Inc., as seller, servicer, custodian and
administrator, BMW FS Funding Corporation, as seller, and The Chase Manhattan
Bank, as indenture trustee, as the same may be amended or supplemented from
time to time.
"Secretary of State" shall mean the Secretary of State of the State
of Delaware.
"Treasury Regulations" shall mean regulations, including proposed or
temporary Regulations, promulgated under the Code. References herein to
specific provisions of proposed or temporary regulations shall include
analogous provisions of final Treasury Regulations or other successor Treasury
Regulations.
"Trust" shall mean the trust established by this Agreement.
"Trust Certificate" shall mean a certificate evidencing the
beneficial interest of a Certificateholder in the Trust, substantially in the
form attached hereto as Exhibit A.
"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 Sale and Servicing Agreement, all funds on deposit from time to time in
the Trust Accounts and the Certificate Distribution Account, and all other
property of the Trust from time to time, including any rights of the Owner
Trustee and the Trust pursuant to the Sale and Servicing Agreement and the
Administration Agreement.
Section 1.02. Other Definitional Provisions.
(a) Capitalized terms used and not otherwise defined herein
have the meanings assigned to them in the Sale and Servicing Agreement or, if
not defined therein, in the Indenture.
(b) All terms defined in this Agreement shall have the
defined meanings when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or
other document made or delivered pursuant hereto or thereto, accounting terms
not defined in this Agreement or in any such certificate or other document,
and accounting terms partly defined in this Agreement or in any such
certificate or other document to the extent not defined, shall have the
respective meanings given to them under generally accepted accounting
principles. To the extent that the definitions of accounting terms in this
Agreement or in any such certificate or other document are inconsistent with
the meanings of such terms under generally accepted accounting principles, the
definitions contained in this Agreement or in any such certificate or other
document shall control.
(d) The words "hereof," "herein," "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; Section and
Exhibit references contained in this Agreement are references to Sections and
Exhibits in or to this Agreement unless otherwise specified; "or" includes
"and/or"; and the term "including" shall mean "including without limitation".
(e) The definitions contained in this Agreement are
applicable to the singular and plural forms of such terms and to the
masculine, feminine and neuter genders of such terms.
(f) Any agreement, instrument or statute defined or referred
to herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein; references to a Person are also to its permitted
successors and assigns.
ARTICLE II
ORGANIZATION
Section 2.01. Name. The Trust created hereby shall be known as "BMW
Vehicle Owner Trust 1999-A," in which name the Owner Trustee may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and sue and be sued.
Section 2.02. Office. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address in
Delaware as the Owner Trustee may designate by written notice to the
Certificateholders and the Depositor.
Section 2.03. Purposes and Powers. The purpose of the Trust is to
engage in the following activities and the Trust shall have the power and
authority:
(a) to issue the Notes pursuant to the Indenture
and the Trust Certificates pursuant to this Agreement and to sell the
Notes and the Trust Certificates, all in accordance with the Basic
Documents;
(b) with the proceeds of the sale of the Notes and
the Trust Certificates, to purchase the Initial Receivables, to fund
the Pre-Funding Account, the Capitalized Interest Account and the
Reserve Account, to pay the organizational, start-up and
transactional expenses of the Trust and to pay the balance of such
proceeds to the Depositor pursuant to the Sale and Servicing
Agreement;
(c) to assign, grant, transfer, pledge, mortgage
and convey the Trust Estate pursuant to the Indenture and to hold,
manage and distribute to the Certificateholders pursuant to the terms
of the Sale and Servicing Agreement any portion of the Trust Estate
released from the Lien of, and remitted to the Trust pursuant to, the
Indenture;
(d) to enter into and perform its obligations
under the Basic Documents to which it is to be a party;
(e) 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
(f) subject to compliance with the Basic Documents,
to engage in such other activities as may be required in connection
with conservation of the Trust Estate and the making of distributions
to the Certificateholders and the Noteholders.
The Trust is hereby authorized to engage in the foregoing activities.
The Trust shall not engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of this
Agreement or the Basic Documents.
Section 2.04. Appointment of Owner Trustee. The Depositor hereby
appoints the Owner Trustee as trustee of the Trust effective as of the date
hereof, to have all the rights, powers and duties set forth herein.
Section 2.05. Initial Capital Contribution of Trust Estate. The
Depositor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, as of the date hereof, the sum of $1. The Owner Trustee hereby
acknowledges receipt in trust from the Depositor, as of the date hereof, of
the foregoing contribution, which shall constitute the initial Trust Estate
and shall be deposited in the Certificate Distribution Account. The Depositor
shall pay organizational expenses of the Trust as they may arise or shall,
upon the request of the Owner Trustee, promptly reimburse the Owner Trustee
for any such expenses paid by the Owner Trustee.
Section 2.06. Declaration of Trust. The Owner Trustee hereby declares
that it will hold the Trust Estate in trust upon and subject to the conditions
set forth herein 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 and that this Agreement constitute the governing
instrument of such business trust. It is the intention of the parties hereto
that, solely for income and franchise tax purposes, the Trust shall be treated
as a partnership for income and franchise tax purposes, with the assets of the
partnership being the Receivables and other assets held by the Trust, the
partners of the partnership being the Certificateholders, and the Notes being
debt of the partnership. The parties agree that, unless otherwise required by
appropriate tax authorities, the Trust and to the extent applicable, the
Certificateholders will file or cause to be filed annual or other necessary
returns, reports and other forms consistent with the characterization of the
Trust provided in the preceding sentence for such tax purposes and will not
take any position contrary to this characterization in any federal or state
tax filings. Effective as of the date hereof, the Owner Trustee shall have all
rights, powers and duties set forth herein and in the Business Trust Statute
with respect to accomplishing the purposes of the Trust.
Section 2.07. [Reserved].
Section 2.08. Title to Trust Property. Subject to the Indenture,
legal title to all the 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 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 or a separate trustee, as the case may be.
Section 2.09. Situs of Trust. The Trust will 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
or the State of New York. The Trust shall not have any employees; provided,
however, that nothing herein shall restrict or prohibit the Owner Trustee from
having employees within or without the State of Delaware. Payments will be
received by the Trust only in Delaware or New York, and payments will be made
by the Trust only from Delaware or New York. The only office of the Trust will
be at the Corporate Trust Office in the State of Delaware.
Section 2.10. Representations, Warranties and Covenants of the
Depositor. The Depositor hereby represents and warrants to the Owner Trustee
that:
(a) The Depositor is duly organized and validly
existing as a corporation in good standing under the laws of the
State of Delaware, with power and authority to own its properties and
to conduct its business as such properties are currently owned and
such business is presently conducted.
(b) The Depositor is duly qualified to do business
as a foreign corporation in good standing and has obtained all
necessary licenses and approvals in all jurisdictions in which the
ownership or lease of its property or the conduct of its business
shall require such qualifications.
(c) The Depositor has the power and authority to
execute and deliver this Agreement and to carry out its terms; the
Depositor has full power and authority to sell and assign the
property to be sold and assigned to and deposited with the Trust and
the Depositor has duly authorized such sale and assignment and
deposit to the Trust by all necessary corporate action; and the
execution, delivery and performance of this Agreement have been duly
authorized by the Depositor by all necessary corporate action.
(d) The Depositor has duly executed and delivered
this Agreement, and this Agreement constitutes a legal, valid and
binding obligation of the Depositor, enforceable against the
Depositor, in accordance with its terms.
(e) The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms
hereof do not conflict with, result in any breach of any of the terms
and provisions of, or constitute (with or without notice or lapse of
time) a default under, the certificate of incorporation or bylaws of
the Depositor, or any indenture, agreement or other instrument to
which the Depositor is a party or by which it is bound; nor result in
the creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such indenture, agreement or other
instrument (other than pursuant to the Basic Documents); nor violate
any law or, to the best of the Depositor's knowledge, any order, rule
or regulation applicable to the Depositor of any court or of any
federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Depositor
or its properties.
(f) There are no proceedings or investigations
pending or threatened before any court, regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties (i) asserting the
invalidity of this Agreement, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this
Agreement or (iii) seeking any determination or ruling that might
materially and adversely affect the performance by the Depositor of
its obligations under, or the validity or enforceability of, this
Agreement.
(g) The representations and warranties of the
Depositor in Section 3.02 of the Sale and Servicing Agreement are
true and correct.
Section 2.11. Federal Income Tax Allocations. Net income of the Trust
for any month as determined for federal income tax purposes (and each item of
income, gain, loss and deduction entering into the computation thereof) shall
be allocated:
(a) among the Certificate Owners as of the first day following the
end of such month, in proportion to their ownership of principal amount of
Trust Certificates on such date, net income in an amount up to the sum of (1)
the Certificateholders' Monthly Interest Distributable Amount for such month,
(ii) interest on the excess, if any, of the Certificateholders' Interest
Distributable Amount for the preceding Distribution Date over the amount in
respect of interest that is actually deposited in the Certificate Distribution
Account on such preceding Distribution Date, to the extent permitted by law,
at the Pass-Through Rate from such preceding Distribution Date through the
current Distribution Date, (iii) the portion of the market discount on the
Receivables accrued during such month that is allocable to the excess, if any,
of the initial aggregate principal amount of the Trust Certificates over their
initial aggregate issue price, and (iv) any other amounts of income payable to
the Certificateholders for such month; such sum to be reduced by any
amortization by the Trust of premium on Receivables that corresponds to any
excess of the issue price of Certificates over their principal amount; and
(b) to the holder of the Residual Interest, to the extent of any
remaining net income.
If the net income of the Trust for any month is insufficient for the
allocations described in clause (i) above, subsequent net income shall first
be allocated to make up such shortfall before being allocated as provided in
the preceding sentence. Net losses of the Trust, if any, for any month as
determined for federal income tax purposes (and each item of income, gain,
loss and deduction entering into the computation thereof) shall be allocated
to the holder of the residual interest in the Trust to the extent the such
Person is reasonably expected to bear the economic burden of such net losses,
and any remaining net losses shall be allocated among the Certificate Owners
as of the first Record Date following the end of such month in proportion to
their ownership of principal amount of Trust Certificates on such Record Date.
The Trust is authorized to modify the allocations in this paragraph if
necessary or appropriate, in its sole discretion, for the allocations to
fairly reflect the economic income, gain or loss to the Certificateholders, or
as otherwise required by the Code.
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
Section 3.01. Initial Ownership. Upon the formation of the Trust by
the contribution by the Depositor pursuant to Section 2.05 and until the
issuance of the Trust Certificates or the transfer by the Depositor of the
Residual Interest, the Depositor shall be the sole beneficiary of the Trust.
Section 3.02. The Trust Certificates. The Trust Certificates shall be
issued in minimum denominations of $20,000 and in integral multiples of $1,000
in excess thereof; provided, however, that the Trust Certificates may be
issued in such denomination as required to include any residual amount. The
Trust Certificates shall be executed on behalf of the Trust by manual or
facsimile signature of an authorized officer of the Owner Trustee. Trust
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 validly issued and entitled to the
benefit of this Agreement and shall be valid and binding obligations of the
Trust, notwithstanding that such individuals or any of them shall have ceased
to be so authorized prior to the authentication and delivery of such Trust
Certificates or did not hold such offices at the date of authentication and
delivery of such Trust Certificates.
A transferee of a Trust Certificate, if any, shall become a
Certificateholder and shall be entitled to the rights and subject to the
obligations of a Certificateholder hereunder upon such transferee's acceptance
of a Trust Certificate duly registered in such transferee's name pursuant to
Section 3.04.
Section 3.03. Execution, Authentication and Delivery of Trust
Certificates. On the Closing Date, the Owner Trustee shall cause the Trust
Certificates in an aggregate principal amount equal to the Initial Certificate
Balance to be executed on behalf of the Trust, authenticated and delivered to
or upon the written order of the Depositor, signed by the Owner Trustee on
behalf of the Trust, without further action by the Depositor, in authorized
denominations. No Trust Certificate shall entitle its Holder to any benefit
under this Agreement or be valid for any purpose unless there shall appear on
such Trust Certificate a certificate of authentication substantially in the
form set forth in Exhibit A, executed by the Owner Trustee or The Chase
Manhattan Bank, as the Owner Trustee's authenticating agent, by manual
signature; such authentication shall constitute conclusive evidence that such
Trust Certificate shall have been duly authenticated and delivered hereunder.
All Trust Certificates shall be dated the date of their authentication.
Section 3.04. Registration of Transfer and Exchange of Trust
Certificates. The Certificate Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 3.08, a Certificate Register
in which, subject to such reasonable regulations as it may prescribe, the
Owner Trustee shall provide for the registration of Trust Certificates and of
transfers and exchanges of Trust Certificates as herein provided. Wilmington
Trust Company shall be the initial Certificate Registrar.
Upon surrender for registration of transfer of any Trust Certificate
at the office or agency maintained pursuant to Section 3.08, the Owner Trustee
shall execute, authenticate and deliver (or shall cause The Chase Manhattan
Bank as its authenticating agent to authenticate and deliver), in the name of
the designated transferee or transferees, one or more new Trust Certificates
in authorized denominations of a like aggregate amount dated the date of
authentication by the Owner Trustee or any authenticating agent. At the option
of a Certificateholder, Trust Certificates may be exchanged for other Trust
Certificates of authorized denominations of a like aggregate amount upon
surrender of the Trust Certificates to be exchanged at the office or agency
maintained pursuant to Section 3.08.
Every Trust 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 related Certificateholder or such Certificateholder's attorney
duly authorized in writing. Each Trust Certificate surrendered for
registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Owner Trustee in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Trust Certificates, but the Owner Trustee or the Certificate
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Trust Certificates.
The preceding provisions of this Section notwithstanding, the Owner
Trustee shall not make, and the Certificate Registrar shall not register
transfers or exchanges of, Trust Certificates for a period of 15 days
preceding the due date for any payment with respect to the Trust Certificates.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the transfer
of the Certificates.
Section 3.05. Mutilated, Destroyed, Lost or Stolen Trust
Certificates. If (a) any mutilated Trust Certificate shall be surrendered to
the Certificate Registrar, or if the Certificate Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Certificate and (b) there shall be delivered to the Certificate Registrar and
the Owner Trustee such security or indemnity as may be required by them to
save each of them harmless, then in the absence of notice that such Trust
Certificate has been acquired by a bona fide purchaser, the Owner Trustee on
behalf of the Trust shall execute and the Owner Trustee or The Chase Manhattan
Bank, as the Owner Trustee's authenticating agent, shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Trust Certificate, a new Trust Certificate of like tenor and
denomination. In connection with the issuance of any new Trust Certificate
under this Section, the Owner Trustee or the Certificate Registrar may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection therewith. Any duplicate Trust Certificate
issued pursuant to this Section shall constitute conclusive evidence of
ownership in the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Trust Certificate shall be found at any time.
Section 3.06. Persons Deemed Owners. Prior to due presentation of a
Trust Certificate for registration of transfer, the Owner Trustee, the
Certificate Registrar or any Paying Agent may treat the Person in whose name
any Trust Certificate is registered in the Certificate Register as the owner
of such Trust Certificate for the purpose of receiving distributions pursuant
to Section 5.02 and for all other purposes whatsoever, and none of the Owner
Trustee, the Certificate Registrar or any Paying Agent shall be bound by any
notice to the contrary.
Section 3.07. Access to List of Certificateholders' Names and
Addresses. The Owner Trustee shall furnish or cause to be furnished to the
Servicer, the Paying Agent and the Depositor, within 15 days after receipt by
the Owner Trustee of a written request therefor from the Servicer, the Paying
Agent or the Depositor, a list, in such form as the Servicer or the Depositor
may reasonably require, of the names and addresses of the Certificateholders
as of the most recent Record Date. The Certificate Registrar shall also
furnish to the Owner Trustee and the Paying Agent a copy of such list at any
time there is a change therein. If (i) three or more Certificateholders or
(ii) one or more Holders of Trust Certificates evidencing not less than 50% of
the Certificate Balance apply in writing to the Owner Trustee, and such
application states that the applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Trust Certificates and such application is accompanied by a copy of the
communication that such applicants propose to transmit, then the Owner Trustee
shall, within five Business Days after the receipt of such application, afford
such applicants access during normal business hours to the current list of
Certificateholders. Each Certificateholder, by receiving and holding a Trust
Certificate, shall be deemed to have agreed not to hold any of the Depositor,
the Certificate Registrar 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. The Certificate Registrar shall upon the request of
the Owner Trustee provide such list, or access to such list, of
Certificateholders as contemplated by this Section 3.07.
Section 3.08. Maintenance of Office or Agency. The Owner Trustee
shall designate in the Borough of Manhattan, the City of New York, an office
or offices or agency or agencies where Trust Certificates may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Owner Trustee in respect of the Trust Certificates and the Basic
Documents may be served. The Owner Trustee initially designates The Chase
Manhattan Bank as its office for such purposes. The Owner Trustee shall give
prompt written notice to the Depositor and the Certificateholders of any
change in the location of the Certificate Register or any such office or
agency.
Section 3.09. Appointment of Paying Agent. The Paying Agent shall
make distributions to Certificateholders from the Certificate Distribution
Account pursuant to Section 5.02 and shall report the amounts of such
distributions to the Owner Trustee. Any Paying Agent shall have the revocable
power to withdraw funds from the Certificate Distribution Account for the
purpose of making the distributions referred to above. The Owner Trustee may
revoke such power and remove the Paying Agent if the Owner Trustee determines
in its sole discretion that the Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect; provided, however,
the Owner Trustee shall have no duty to monitor or oversee the compliance by
the Paying Agent of its obligations under this Agreement or any other Basic
Document. The Paying Agent initially shall be The Chase Manhattan Bank, and
any co-paying agent chosen by Wilmington Trust Company. The Chase Manhattan
Bank shall be permitted to resign as Paying Agent upon 30 days' written notice
to the Owner Trustee. In the event that The Chase Manhattan Bank shall no
longer be the Paying Agent, the Depositor, with the consent of the Owner
Trustee, shall appoint a successor to act as Paying Agent (which shall be a
bank or trust company). The Owner Trustee shall cause such successor Paying
Agent or any additional Paying Agent appointed hereunder 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 will hold
all sums, if any, held by it for payment 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 7.01, 7.03, 7.04 and 8.01 shall apply to
the Owner Trustee also in its role as Paying Agent, for so long as the Owner
Trustee shall act as Paying Agent and, to the extent applicable, to any other
paying agent appointed hereunder. Any reference in this Agreement to the
Paying Agent shall include any co-paying agent unless the context requires
otherwise.
Section 3.10. Book-Entry Trust Certificates. The Trust Certificates,
upon original issuance, will be issued in the form of a typewritten Trust
Certificate or Trust Certificates representing Book-Entry Trust Certificates,
to be delivered to The Depository Trust Company, the initial Clearing Agency,
by, or on behalf of, the Trust. Such Trust Certificate or Trust Certificates
shall initially be registered on the Certificate Register in the name of Cede
& Co., the nominee of the initial Clearing Agency, and no Certificate Owner
will receive a definitive Trust Certificate representing such Certificate
Owner's interest in such Trust Certificate, except as provided in Section
3.12. Unless and until definitive, fully registered Trust Certificates (the
"Definitive Trust Certificates") have been issued to Certificate Owners
pursuant to Section 3.12:
(a) The provisions of this Section shall be in
full force and effect;
(b) The Certificate Registrar and the Owner Trustee
shall be entitled to deal with the Clearing Agency for all purposes
of this Agreement (including the payment of principal of and interest
on the Trust Certificates and the giving of instructions or
directions hereunder) as the sole Holder of the Trust Certificates
and shall have no obligation to the Certificate Owners;
(c) To the extent that the provisions of this
Section conflict with any other provisions of this Agreement, the
provisions of this Section shall control;
(d) The rights of Certificate Owners shall be
exercised only through the Clearing Agency and shall be limited to
those established by law and agreements between such Certificate
Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement,
unless and until Definitive Trust Certificates are issued pursuant to
Section 3.13, the initial Clearing Agency will make book-entry
transfers among the Clearing Agency Participants and receive and
transmit payments of principal of and interest on the Trust
Certificates to such Clearing Agency Participants; and
(e) Whenever this Agreement requires or permits
actions to be taken based upon instructions or directions of Holders
of Trust Certificates evidencing a specified percentage of the
Certificate Balance, the Clearing Agency shall be deemed to represent
such percentage only to the extent that it has received instructions
to such effect from Certificate Owners and/or Clearing Agency
Participants owning or representing, respectively, such required
percentage of the beneficial interest in the Trust Certificates and
has delivered such instructions to the Owner Trustee.
Section 3.11 Notices to Clearing Agency. Whenever a notice or other
communication to the Certificateholders is required under this Agreement,
unless and until Definitive Trust Certificates shall have been issued to
Certificate Owners pursuant to Section 3.12, the Owner Trustee shall give all
such notices and communications specified herein to be given to
Certificateholders to the Clearing Agency, and shall have no obligations to
the Certificate Owners.
Section 3.12 Definitive Trust Certificates. If (i) the Administrator
advises the Owner Trustee in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities with respect to the
Book-Entry Trust Certificates and the Administrator is unable to locate a
qualified successor, (ii) the Administrator at its option advises the Owner
Trustee in writing that it elects to terminate the book-entry system through
the Clearing Agency or (iii) after the occurrence of an Event of Default or a
Servicer Default, Certificate Owners representing beneficial interests
aggregating at least a majority of the Certificate Balance advise the Clearing
Agency in writing that the continuation of a book-entry system through the
Clearing Agency is no longer in the best interest of the Certificate Owners,
then the Clearing Agency shall notify all Certificate Owners and the Owner
Trustee of the occurrence of any such event and of the availability of
Definitive Trust Certificates to Certificate Owners requesting the same. Upon
surrender to the Owner Trustee of the typewritten Trust Certificate or Trust
Certificates representing the Book-Entry Trust Certificates by the Clearing
Agency, accompanied by registration instructions, the Trust shall execute and
the Owner Trustee shall authenticate the Definitive Trust Certificates in
accordance with the written instructions of the Clearing Agency. None of the
Trust, the Certificate Registrar or the Owner Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such instructions. Upon the issuance of Definitive
Trust Certificates, the Owner Trustee shall recognize the Holders of the
Definitive Trust Certificates as Certificateholders. The Definitive Trust
Certificates shall be printed, lithographed or engraved or may be produced in
any other manner as is reasonably acceptable to the Owner Trustee, as
evidenced by its execution thereof.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.01. Prior Notice with Respect to Certain Matters. With
respect to the following matters, the Owner Trustee shall not take action
unless at least 30 days before the taking of such action, the Owner Trustee
shall have notified the Certificateholders of record as of the preceding
Record Date in writing of the proposed action and such 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 (except claims or lawsuits brought in connection with the
collection of the Receivables) and the compromise of any action,
claim or lawsuit brought by or against the Trust (except with respect
to the aforementioned claims or lawsuits for collection of the
Receivables);
(b) the election by the Trust to file an amendment
to the Certificate of Trust (unless such amendment is required to be
filed under the Business Trust Statute);
(c) the amendment of the Indenture by a
supplemental indenture or any other change to this Agreement or any
Basic Document in circumstances where the consent of any Noteholder
is required;
(d) the amendment of the Indenture by a
supplemental indenture or any other change to this Agreement or any
Basic Document in circumstances where the consent of any Noteholder
is not required and such amendment would 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 or add any provision that would
not materially adversely affect the interests of the
Certificateholders;
(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;
(g) the consent to the calling or waiver of any
default of any Basic Document;
(h) the consent to the assignment by the Indenture
Trustee or Servicer of their respective obligations under any Basic
Document, unless permitted in the Basic Documents;
(i) except as provided in Article IX hereof,
dissolve, terminate or liquidate the Trust in whole or in part;
(j) merge or consolidate the Trust with or into any
other entity, or convey or transfer all or substantially all of the
Trust's assets to any other entity;
(k) cause the Trust to incur, assume or guaranty
any indebtedness other than as set forth in this Agreement or the
Basic Documents;
(l) do any act that conflicts with any other
Basic Document;
(m) do any act that would make it impossible to
carry on the ordinary business of the Trust as described in Section
2.03 hereof;
(n) confess a judgment against the Trust;
(o) possess Trust assets, or assign the Trust's
right to property, for other than a Trust purpose;
(p) cause the Trust to lend any funds to any
entity, unless permitted in the Basic Documents; or
(q) change the Trust's purpose and powers from
those set forth in this Trust Agreement.
In addition, the Trust shall not commingle its assets with those of
any other entity. The Trust shall maintain its financial and accounting books
and records separate from those of any other entity. Except as expressly set
forth herein, the Trust shall not pay the indebtedness, operating expenses and
liabilities of any other entity. The Trust shall maintain appropriate minutes
or other records of all appropriate actions and shall maintain its office
separate from the offices of the Depositor and the Servicer.
The Owner Trustee shall not have the power, except upon the direction
of the Certificateholders, and to the extent otherwise consistent with the
Basic Documents, to (i) remove or replace the Servicer or the Indenture
Trustee, (ii) institute proceedings to have the Trust declared or adjudicated
a bankruptcy or insolvent, (iii) consent to the institution of bankruptcy or
insolvency proceedings against the Trust, (iv) file a petition or consent to a
petition seeking reorganization or relief on behalf of the Trust under any
applicable federal or state law relating to bankruptcy, (v) consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or any
similar official) of the Trust or a substantial portion of the property of the
Trust, (vi) make any assignment for the benefit of the Trust's creditors,
(vii) cause the Trust to admit the writing its inability to pay its debts
generally as they become due, (viii) take any action, or cause the Trust to
take any action, in furtherance of any of the foregoing (any of the above, a
"Bankruptcy Action"). So long as the Indenture remains in effect, no
Certificateholder shall have the power to take, and shall not take, any
Bankruptcy Action with respect to the Trust or direct the Owner Trust to take
any Bankruptcy Action with respect to the Trust.
Section 4.02. Action by Certificateholders with Respect to Certain
Matters. The Owner Trustee shall not have the power, except upon the written
direction of the Certificateholders, to (a) remove the Administrator under the
Administration Agreement pursuant to Section 8 thereof, (b) appoint a
successor Administrator pursuant to Section 8 of the Administration Agreement,
(c) remove the Servicer under the Sale and Servicing Agreement pursuant to
Section 8.02 thereof, (d) amend the Sale and Servicing Agreement pursuant to
Section 10.01(b) of such document, or (e) except as expressly provided in the
Basic Documents, sell the Receivables after the termination of the Indenture.
The Owner Trustee shall take the actions referred to in the preceding sentence
only upon written instructions signed by the Certificateholders.
Section 4.03. 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 Certificateholders and the delivery to the Owner Trustee by
each such Certificateholder of a certification certifying that such
Certificateholder reasonably believes that the Trust is insolvent.
Section 4.04. Restrictions on Certificateholders' Power. The
Certificateholders shall not direct the Owner Trustee to take or to refrain
from taking any action if such action or inaction would be contrary to any
obligation of the Trust or the Owner Trustee under this Agreement or any of
the Basic Documents or would be contrary to Section 2.03; nor shall the Owner
Trustee be obligated to follow any such direction, if given.
Section 4.05. Majority Control. Except as expressly provided herein,
any action that may be taken by the Certificateholders under this Agreement
may be taken by the Holders of Trust Certificates evidencing not less than a
majority of the Certificate Balance. Except as expressly provided herein, any
written notice of the Certificateholders delivered pursuant to this Agreement
shall be effective if signed by Holders of Trust Certificates evidencing not
less than a majority of the Certificate Balance at the time of the delivery of
such notice.
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
Section 5.01. Establishment of Trust Account. The Owner Trustee, for
the benefit of the Certificateholders, shall cause the Paying Agent to
establish and maintain in the name of the Trust an Eligible Deposit Account
(the "Certificate Distribution Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Certificateholders. The title of the Certificate Distribution Account shall be
"BMW Vehicle Owner Trust 1999-A: Certificate Distribution Account for the
benefit of the Certificateholders."
The Trust, for the benefit of the Certificateholders, shall cause the
Paying Agent to establish and maintain in the name of the Trust an Eligible
Deposit Account (the "Certificate Interest Reserve Account"), bearing a
designation clearly indicating that the funds deposited therein are held for
the benefit of the Certificateholders. The title of the Certificate Interest
Reserve Account shall be "BMW Vehicle Owner Trust 1999-A: Certificate Interest
Reserve Account for the benefit of the Certificateholders."
The Trust shall possess all right, title and interest in all funds on
deposit from time to time in the Certificate Distribution Account and the
Certificate Interest Reserve Account and in all proceeds thereof. Except as
otherwise expressly provided herein, the Certificate Distribution Account and
the Certificate Interest Reserve Account shall be under the sole dominion and
control of the Owner Trustee for the benefit of the Certificateholders. If, at
any time, the Certificate Distribution Account or the Certificate Interest
Reserve Account ceases to be an Eligible Deposit Account, the Paying Agent
shall within 10 Business Days (or such longer period, not to exceed 30
calendar days, as to which each Rating Agency may consent) establish a new
Certificate Distribution Account or Certificate Interest Reserve Account, as
applicable, as an Eligible Deposit Account and shall transfer any cash or any
investments to such new Certificate Distribution Account or Certificate
Interest Reserve Account, as applicable.
Section 5.02. Application of Trust Funds.
(a) On each Distribution Date, the Owner Trustee shall cause
the Paying Agent to distribute to Certificateholders, on a pro rata basis
among the Certificateholders, amounts deposited in the Certificate
Distribution Account and the Certificate Interest Reserve Account pursuant to
Section 5.06 of the Sale and Servicing Agreement with respect to such
Distribution Date.
(b) On each Distribution Date, the Owner Trustee shall cause
the Paying Agent to send to each Certificateholder the statement or statements
provided to the Owner Trustee by the Servicer pursuant to Section 5.08 of the
Sale and Servicing Agreement with respect to such Distribution Date.
(c) On each Distribution Date, the holder of the Residual
Interest shall be entitled to receive amounts distributable to BMW FS
Receivables Corporation pursuant to the Sale and Servicing Agreement.
(d) In the event that any withholding tax is imposed on the
Trust's payment (or allocations of income) to a Certificateholder, such tax
shall reduce the amount otherwise distributable to such Certificateholder in
accordance with this Section. The Owner Trustee or Paying Agent 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
or the Paying Agent 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 or the Paying Agent may in its
sole discretion withhold such amounts in accordance with this paragraph.
Any Holder of a Trust Certificate that is organized under the laws of
a jurisdiction outside the United States shall, on or prior to the date such
Holder becomes a Holder, (a) so notify the Owner Trustee and the Paying Agent,
(b) (i) provide the Owner Trustee and the Paying Agent with Internal Revenue
Service form 1001, 4224, 8709 or W-8 (or successor forms), as appropriate, or
(ii) notify the Owner Trustee and the Paying Agent that it is not entitled to
an exemption from United States withholding tax or a reduction in the rate
thereof on payments of interest. Any such Holder agrees by its acceptance of a
Trust Certificate, on an ongoing basis, to provide like certification for each
taxable year and to notify the Owner Trustee and the Paying Agent should
subsequent circumstances arise affecting the information provided the Owner
Trustee or the Paying Agent in clauses (a) and (b) above. The Owner Trustee
and the Paying Agent shall be fully protected in relying upon, and each Holder
by its acceptance of a Trust Certificate hereunder agrees to indemnify and
hold the Owner Trustee and the Paying Agent harmless against all claims or
liability of any kind arising in connection with or related to the Owner
Trustee's and the Paying Agent's reliance upon any documents, forms or
information provided by any Holder to the Owner Trustee and the Paying Agent.
Section 5.03. Method of Payment. Subject to Section 9.01(c),
distributions required to be made to Certificateholders on any Distribution
Date shall be made to each Certificateholder of record on the preceding Record
Date either by wire transfer, in immediately available funds, to the account
of such Certificateholder at a bank or other entity having appropriate
facilities therefor, if such Certificateholder shall have provided to the
Certificate Registrar and the Paying Agent appropriate written instructions at
least five Business Days prior to such Distribution Date and such Holder's
Trust Certificates in the aggregate evidence a denomination of not less than
$1,000,000, or, if not, by check mailed to such Certificateholder at the
address of such Certificateholder appearing in the Certificate Register.
Section 5.04. [Reserved].
Section 5.05. Accounting and Reports to Certificateholders, the
Internal Revenue Service and Others. The Owner Trustee shall (a) unless
otherwise required under the Code, maintain (or cause to be maintained) the
books of the Trust on a calendar year basis and the accrual method of
accounting, (b) deliver (or cause to delivered) to each Certificateholder, as
may be required by the Code and applicable Treasury Regulations, such
information as may be required (including Schedule K-1) to enable each
Certificateholder to prepare its federal and state income tax returns, (c)
file (or cause to be filed) such tax returns relating to the Trust (including
a partnership information return, IRS Form 1065), if there is not more than
one beneficial owner of an equity interest in the Trust for tax purposes, and
make such elections as from time to time may be required or appropriate under
any applicable state or federal statute or any rule or regulation thereunder
so as to maintain the Trust's characterization either a disregarded entity or
as a partnership for federal income tax purposes (as appropriate), (d) cause
such tax returns to be signed in the manner required by law and (e) collect or
cause to be collected any withholding tax as described in and in accordance
with Section 5.02(c) with respect to income or distributions to
Certificateholders. The Owner Trustee shall elect under Section 1278 of the
Code to include in income currently any market discount that accrues with
respect to the Receivables if so directed in writing by the Administrator. The
Owner Trustee shall not make the election provided under Section 754 of the
Code. The parties to this Agreement agree and acknowledge that the
Administrator shall perform the duties and obligations of the Owner Trustee
under this Section 5.05 in accordance with the Administration Agreement.
Section 5.06. Signature on Returns; Tax Matters Partner.
(a) The Owner Trustee shall sign on behalf of the Trust the
tax returns of the Trust, if any, unless applicable law requires a
Certificateholder to sign such documents.
(b) BMW Financial Services NA, Inc. shall be designated the
"tax matters partner" of the Trust pursuant to Section 6231(a)(7)(A) of the
Code and applicable Treasury Regulations.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 6.01. General Authority. The Owner Trustee is authorized and
directed to execute and deliver the Basic Documents to which the Trust is to
be a party and each certificate or other document attached as an exhibit to or
contemplated by the Basic Documents to which the Trust is to be a party, in
each case, in such form as the Depositor shall approve, as evidenced
conclusively by the Owner Trustee's execution thereof. In addition to the
foregoing, the Owner Trustee is authorized, but shall not be obligated, to
take all actions required of the Trust pursuant to the Basic Documents. The
Owner Trustee is further authorized from time to time to take such action as
the Administrator recommends with respect to the Basic Documents.
Section 6.02. General Duties. It shall be the duty of the Owner
Trustee:
(a) to discharge (or cause to be discharged) all of its
responsibilities pursuant to the terms of this Agreement and the Basic
Documents to which the Trust is a party and to administer the Trust in the
interest of the Certificateholders, subject to the Basic Documents and in
accordance with the provisions of this Agreement; provided, however, that
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 held
liable for the default or failure of the Administrator to carry out its
obligations under the Administration Agreement; and
(b) to cooperate with the Administrator in carrying out the
Administrator's obligation to qualify and preserve the Trust's qualification
to do business in each jurisdiction, if any, in which such qualification is or
shall be necessary to protect the validity and enforceability of the
Indenture, the Notes, the Receivables and any other instrument and agreement
included in the Trust Estate; provided that the Owner Trustee may rely on
advice of counsel with respect to such obligation.
Section 6.03. Action upon Instruction.
(a) Subject to Article IV and in accordance with the terms
of the Basic Documents, 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 Article IV.
(b) 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 under any Basic Document, the Owner Trustee shall promptly give
notice (in such form as shall be appropriate under the circumstances) to the
Certificateholders of record as of the preceding Record Date requesting
instruction as to the course of action to be adopted, and to the extent the
Owner Trustee acts in good faith in accordance with any written instruction of
such Certificateholders 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 instruction within 10 days of such notice (or within such
shorter period of time as reasonably may be specified in such notice or may be
necessary under the circumstances) it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Agreement or the
Basic Documents, as it shall deem to be in the best interests of the
Certificateholders, and shall have no liability to any Person for such action
or inaction.
(d) In the event that the Owner Trustee is unsure as to the
application of any provision of this Agreement or any Basic Document or any
such provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to
take with respect to a particular set of facts, the Owner Trustee may give
notice (in such form as shall be appropriate under the circumstances) to the
Certificateholders of record as of the preceding Record Date requesting
instruction and, to the extent that the Owner Trustee acts or refrains from
acting in good faith in accordance with any such instruction received, the
Owner Trustee shall not be liable, on account of such action or inaction, to
any Person. If the Owner Trustee shall not have received appropriate
instruction within 10 days of such notice (or within such shorter period of
time as reasonably may be specified in such notice or may be necessary under
the circumstances) it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Agreement or the Basic
Documents, as it shall deem to be in the best interests of the
Certificateholders, and shall have no liability to any Person for such action
or inaction.
Section 6.04. No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall not have any duty or obligation to
manage, make any payment with respect to, register, record, sell, dispose of,
or otherwise deal with the Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with, any document contemplated
hereby to which the Owner Trustee or the Trust is a party, except as expressly
provided by the terms of this Agreement or in any document or written
instruction received by the Owner Trustee pursuant to Section 6.04; and no
implied duties or obligations shall be read into this Agreement or any Basic
Document against the Owner Trustee. The Owner Trustee shall have no
responsibility for filing any financing or continuation statement in any
public office at any time or to otherwise perfect or maintain the perfection
of any security interest or Lien granted to it hereunder or to prepare or file
any Securities and Exchange Commission filing for the Trust or to record this
Agreement or any Basic Document. The Owner Trustee nevertheless agrees that it
will, at its own cost and expense, promptly take all action as may be
necessary to discharge any Liens on any part of the Trust Estate that result
from actions by, or claims against, the Owner Trustee in its individual
capacity that are not related to the ownership or the administration of the
Trust Estate.
Section 6.05. No Action Except Under Specified Documents or
Instructions. The Owner Trustee shall not manage, control, use, sell, dispose
of or otherwise deal with any part of the Trust Estate except (i) in
accordance with the powers granted to and the authority conferred upon the
Owner Trustee pursuant to this Agreement, (ii) in accordance with the Basic
Documents and (iii) in accordance with any document or instruction delivered
to the Owner Trustee pursuant to Section 6.03.
Section 6.06. Restrictions. The Owner Trustee shall not take any
action to that, to the actual knowledge, (a) is inconsistent with the purposes
of the Trust set forth in Section 2.03 or (b) would result in the Trust's
becoming taxable as a corporation for federal income tax purposes. The
Certificateholders shall not direct the Owner Trustee to take action that
would violate the provisions of this Section.
ARTICLE VII
CONCERNING THE OWNER TRUSTEE
Section 7.01. Acceptance of Trusts and Duties. The Owner Trustee
accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts, but only upon the terms of this Agreement. The
Owner Trustee also agrees to disburse all moneys actually received by it
constituting part of the Trust Estate upon the terms of the Basic Documents
and this Agreement. The Owner Trustee shall not be answerable or accountable
hereunder or under any Basic Document under any circumstances, except (i) for
its own willful misconduct or gross negligence or (ii) in the case of the
inaccuracy of any representation or warranty contained in Section 7.03
expressly made by the Owner Trustee. In particular, but not by way of
limitation (and subject to the exceptions set forth in the preceding
sentence):
(a) The Owner Trustee shall not be liable for
any error of judgment made by a Trust Officer of the Owner Trustee;
(b) The Owner Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in
accordance with the instructions of the 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;
(e) The Owner Trustee shall not be responsible for
or in respect of the validity or sufficiency of this Agreement or for
the due execution hereof by the Depositor or for the form, character,
genuineness, sufficiency, value or validity of any of the Trust
Estate, or for or in respect of the validity or sufficiency of the
Basic Documents, other than the certificate of authentication on the
Trust Certificates, 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 or
expressly agreed to in the other Basic Documents;
(f) The Owner Trustee shall not be responsible for
monitoring the performance of, and shall not be liable for the
default or misconduct of the Administrator, the Depositor, the
Servicer , the Indenture Trustee or any other Person 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 Depositor or the
Servicer under the 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 gross negligence or
willful misconduct in the performance of any such act.
Section 7.02. Furnishing of Documents. The Owner Trustee shall
furnish 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.
Section 7.03. Representations and Warranties. The Owner Trustee
hereby represents and warrants to the Depositor, for the benefit of the
Certificateholders, that:
(a) It is a banking corporation duly organized and
validly existing in good standing under the laws of the State of
Delaware. It has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to
authorize the execution and delivery by it of this Agreement, and
this Agreement will be executed and delivered by one of its officers
who is duly authorized to execute and deliver this Agreement on its
behalf.
(c) Neither the execution or the delivery by it of
this Agreement, nor the consummation by it of the transactions
contemplated hereby, nor compliance by it with any of the terms or
provisions hereof will contravene any federal or Delaware law,
governmental rule or regulation governing the banking or trust powers
of the Owner Trustee or any judgment or order binding on it, or
constitute any default under its charter documents or bylaws or any
indenture, mortgage, contract, agreement or instrument to which it is
a party or by which any of its properties may be bound.
(d) It is a corporation satisfying the provisions
of Section 3807(a) of the Business Trust Statute; authorized to
exercise corporate trust powers; having a combined capital and
surplus of at least $50,000,000 and subject to supervision or
examination by federal or state authorities; and having (or having a
parent that has) time deposits that are rated at least A-1 by
Standard & Poor's and P-1 by Moody's or who is otherwise acceptable
to each Rating Agency.
Section 7.04. Reliance; Advice of Counsel.
(a) The Owner Trustee shall incur no liability to anyone in
acting upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond, or other document or paper believed
by it to be genuine and believed by it to be signed by the proper party or
parties. The Owner Trustee may accept a certified copy of a resolution of the
board of directors or other governing body of any corporate party as
conclusive evidence that such resolution has been duly adopted by such body
and that the same is in full force and effect. As to any fact or matter the
method of determination of which is not specifically prescribed herein, the
Owner Trustee may for all purposes hereof rely on a certificate, signed by the
president or any vice president or by the treasurer or other authorized
officers of the relevant party, as to such fact or matter, and such
certificate shall constitute full protection to the Owner Trustee for any
action taken or omitted to be taken by it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts
hereunder and in the performance of its duties and obligations under this
Agreement or the Basic Documents, the Owner Trustee (i) may act directly or
through its agents or attorneys pursuant to agreements entered into with any
of them, and the Owner Trustee shall not be liable for the conduct or
misconduct of such agents or attorneys if such agents or attorneys shall have
been selected by the Owner Trustee with reasonable care, and (ii) may consult
with counsel, accountants and other skilled Persons to be selected with
reasonable care and employed by it. The Owner Trustee shall not be liable for
anything done, suffered or omitted reasonably and in good faith by it in
accordance with the opinion or advice of any such counsel, accountants or
other such Persons.
Section 7.05. Not Acting in Individual Capacity. Except as provided
in this Article VII, in accepting the trusts hereby created, Wilmington Trust
Company 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 Trust Estate for payment or satisfaction thereof.
Section 7.06. Owner Trustee Not Liable for Trust Certificates or for
Receivables. The recitals contained herein and in the Trust Certificates
(other than the signature and countersignature of the Owner Trustee on the
Trust Certificates) shall be taken as the statements of the Depositor, and the
Owner Trustee assumes no responsibility for the correctness thereof. Except as
set forth in Section 7.03, the Owner Trustee makes no representations as to
the validity or sufficiency of this Agreement, of any Basic Document or of the
Trust Certificates (other than the signature and countersignature of the Owner
Trustee on the Trust Certificates) or the Notes, or of any Receivable or
related documents. The Owner Trustee shall at no time have any responsibility
or liability for or with respect to the legality, validity and enforceability
of any Receivable or the perfection and priority of any security interest
created by any Receivable in any Financed Vehicle or the maintenance of any
such perfection and priority, or for or with respect to the sufficiency of the
Trust Estate or its ability to generate the payments to be distributed to
Certificateholders under this Agreement or the Noteholders under the
Indenture, including, without limitation: the existence, condition and
ownership of any Financed Vehicle; the existence and enforceability of any
insurance thereon; the existence and contents of any Receivable on any
computer or other record thereof; the validity of the assignment of any
Receivable to the Trust or of any intervening assignment; the completeness of
any Receivable; the performance or enforcement of any Receivable; the
compliance by the Depositor or the Servicer with any warranty or
representation made under any 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.
Section 7.07. Owner Trustee May Own Trust Certificates and Notes. The
Owner Trustee in its individual or any other capacity may become the owner or
pledgee of Trust Certificates or Notes and may deal with the Depositor, the
Administrator, the Indenture Trustee and the Servicer in banking transactions
with the same rights as it would have if it were not Owner Trustee.
Section 7.08. Doing Business in Other Jurisdictions. Notwithstanding
anything contained herein to the contrary, neither Wilmington Trust Company
nor the Owner Trustee shall be required to take any action in any jurisdiction
other than in the State of Delaware if the taking of such action will (i)
require the consent or approval or authorization or order of, or the giving of
notice to, or the registration with, or the taking of any other action in
required by, any state or other governmental authority or agency of any
jurisdiction other than the State of Delaware; (ii) result in any fee, tax or
other governmental charge under the laws of any jurisdiction or any political
subdivisions thereof in existence on the date hereof other than the State of
Delaware becoming payable by Wilmington Trust Company or the Owner Trustee; or
(iii) subject Wilmington Trust Company or the Owner Trustee to personal
jurisdiction in any jurisdiction other than the State of Delaware for causes
of action arising from acts unrelated to the consummation of the transactions
by Wilmington Trust Company or the Owner Trustee, as the case may be,
contemplated hereby. The Owner Trustee shall be entitled to obtain advice of
counsel (which advice shall be an expense of the Administrator under Section
8.01 of this Agreement) to determine whether any action required to be taken
pursuant to the Agreement results in the consequences described in clauses
(i), (ii) and (iii) of the preceding sentence. In the event that said counsel
advises the Owner Trustee that such action will result in such consequences,
the Owner Trustee will appoint an additional trustee pursuant to Section 10.05
hereof to proceed with such action.
Section 7.09. Paying Agent; Authenticating Agent. The rights and
protections afforded to the Owner Trustee pursuant to Article VII and Sections
8.02, 10.02, and 10.03 shall also be afforded to the Paying Agent,
authenticating agent and Certificate Registrar.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
Section 8.01. Owner Trustee's Fees and Expenses. The Administrator
shall pay to the Owner Trustee as compensation for its services hereunder such
fees as have been separately agreed upon before the date hereof between the
Servicer and the Owner Trustee, and the Administrator shall reimburse the
Owner Trustee for its other reasonable expenses hereunder, including the
reasonable compensation, expenses and disbursements of such agents,
representatives, experts and counsel as the Owner Trustee may employ in
connection with the exercise and performance of its rights and its duties
hereunder and under the Basic Documents.
Section 8.02. Indemnification. The Administrator shall be liable as
primary obligor for, and shall indemnify the Owner Trustee and its successors,
assigns, agents and servants (collectively, the "Indemnified Parties") from
and against, any and all liabilities, obligations, losses, damages, taxes,
claims, actions and suits, and any and all reasonable costs, expenses and
disbursements (including reasonable legal fees and expenses) of any kind and
nature whatsoever (collectively, "Expenses") which may at any time be imposed
on, incurred by, or asserted against the Owner Trustee or any Indemnified
Party in any way relating to or arising out of this Agreement, the Basic
Documents, the Trust Estate, the administration of the Trust Estate or the
action or inaction of the Owner Trustee hereunder, except only that the
Administrator shall not be liable for or required to indemnify an Indemnified
Party from and against Expenses arising or resulting from any of the matters
described in the third sentence of Section 7.01. The indemnities contained in
this Section shall survive the resignation or termination of the Owner Trustee
or the termination of this Agreement. In any event of any claim, action or
proceeding for which indemnity will be sought pursuant to this Section, the
Indemnified Party's choice of legal counsel shall be subject to the approval
of the Administrator, which approval shall not be unreasonably withheld.
Section 8.03. Payments to the Owner Trustee. Any amounts paid
pursuant to this Article VIII shall be payable solely in the priority set
forth in Section 5.06(b) of the Sale and Servicing Agreement and shall be
deemed not to be a part of the Trust Estate immediately after such payment.
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
Section 9.01. Termination of Trust Agreement.
(a) This Agreement (other than Section 5.05 and Article
VIII) and the Trust shall terminate and be of no further force or effect upon
the final distribution by the Owner Trustee of all moneys or other property or
proceeds of the Trust Estate in accordance with the terms of the Indenture,
the Sale and Servicing Agreement and Article V. The bankruptcy, liquidation,
dissolution, death or incapacity of any Certificateholder shall not (i)
operate to terminate this Agreement or the Trust, (ii) 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 Trust Estate or (iii) otherwise affect the
rights, obligations and liabilities of the parties hereto.
(b) Except as provided in Section 9.01(a), neither the
Depositor nor any Certificateholder shall be entitled to revoke or terminate
the Trust.
(c) Notice of any termination of the Trust, specifying the
Distribution Date upon which Certificateholders shall surrender their Trust
Certificates to the Paying Agent for payment of the final distribution and
cancellation, shall be given by the Owner Trustee by letter to
Certificateholders mailed within five Business Days of receipt of notice of
such termination from the Servicer given pursuant to Section 9.01 of the Sale
and Servicing Agreement, stating (i) the Distribution Date upon or with
respect to which final payment of the Trust Certificates shall be made upon
presentation and surrender of the Trust Certificates at the office of the
Paying Agent therein designated, (ii) the amount of any such final payment and
(iii) that the Record Date otherwise applicable to such Distribution Date is
not applicable, payments being made only upon presentation and surrender of
the Trust 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 Trust
Certificates, the Paying Agent shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date pursuant to
Section 5.02.
In the event that all of the Certificateholders shall not surrender
their Trust Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Owner Trustee shall give
a second written notice to the remaining Certificateholders to surrender their
Trust Certificates for cancellation and receive the final distribution with
respect thereto. If within one year after the second notice all the Trust
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 Trust Certificates, and the cost thereof shall be paid out
of the funds and other assets that shall remain subject to this Agreement. Any
funds remaining in the Trust after exhaustion of such remedies shall be
distributed by the Owner Trustee to the holder of the residual interest in the
Trust, subject to applicable escheat laws.
(d) Upon the winding up of the Trust and the written
instructions of the Depositor, the Owner Trustee shall cause the Certificate
of Trust to be cancelled by filing a certificate of cancellation with the
Secretary of State in accordance with the provisions of Section 3810 of the
Business Trust Statute. Thereupon the Trust and this Agreement (other than
Article VIII) shall terminate.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 10.01. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation satisfying the provisions of
Section 3807(a) of the Business Trust Statute; authorized to exercise
corporate trust powers; having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal or state
authorities; and having (or having a parent that has) time deposits that are
rated at least A-1 by Standard & Poor's and P-1 by Moody's, or which is
otherwise acceptable to each Rating Agency. If such corporation shall publish
reports of condition at least annually pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purpose of
this Section, the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time the Owner Trustee shall
cease to be eligible in accordance with the provisions of this Section, the
Owner Trustee shall resign immediately in the manner and with the effect
specified in Section 10.02.
Section 10.02. Resignation or Removal of Owner Trustee. The Owner
Trustee may at any time resign and be discharged from the trusts hereby
created by giving written notice thereof to the Administrator, the Indenture
Trustee and the Rating Agencies. Upon receiving such notice of resignation,
the Administrator shall promptly appoint a successor Owner Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to
the resigning Owner Trustee and one copy to the successor Owner Trustee. If no
successor Owner Trustee shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Owner Trustee may petition any court of competent jurisdiction for
the appointment of a successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.01 and shall fail to resign after
written request therefor by the Administrator, or if at any time the Owner
Trustee shall be legally unable to act, or shall be adjudged bankrupt or
insolvent, or a receiver of the Owner Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the Owner
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Administrator may remove the Owner
Trustee. If the Administrator shall remove the Owner Trustee under the
authority of the immediately preceding sentence, 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.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section
shall not become effective until acceptance of appointment by the successor
Owner Trustee pursuant to Section 10.03 and payment of all fees and expenses
owed to the outgoing Owner Trustee. The Administrator shall provide notice of
such resignation or removal of the Owner Trustee to each Rating Agency.
Section 10.03. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.01 or 10.02 shall execute, acknowledge and
deliver to the Administrator and to its predecessor Owner Trustee an
instrument accepting such appointment under this Agreement, and thereupon the
resignation or removal of the predecessor Owner Trustee shall become
effective, and such successor Owner Trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor under this Agreement, with like effect as if
originally named as Owner Trustee. The predecessor Owner Trustee shall, upon
payment of its fees and expenses, deliver to the successor Owner Trustee all
documents and statements and monies held by it under this Agreement; and the
Administrator and the predecessor Owner Trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for fully
and certainly vesting and confirming in the successor Owner Trustee all such
rights, powers, duties and obligations.
No successor Owner Trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor Owner
Trustee shall be eligible pursuant to Section 10.01.
Upon acceptance of appointment by a successor Owner Trustee pursuant
to this Section, the Administrator shall mail notice thereof to all
Certificateholders, the Servicer, the Indenture Trustee, the Noteholders and
the Rating Agencies. If the Administrator shall fail to mail such notice
within 10 days after acceptance of such appointment by the successor Owner
Trustee, the successor Owner Trustee shall cause such notice to be mailed at
the expense of the Administrator.
Any successor Owner Trustee appointed pursuant to this Section 10.03
shall promptly file an amendment to the Certificate of Trust with the
Secretary of State identifying the name and principal place of business of
such successor Owner Trustee in the State of Delaware.
Section 10.04. 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 Person 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, without
the execution or filing of any instrument or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding;
provided, that such Person shall be eligible pursuant to Section 10.01; and
provided further, that the Owner Trustee shall mail notice of such merger or
consolidation to each Rating Agency; and provided further, that such successor
Owner Trustee shall file an amendment to the Certificate of Trust as described
in Section 10.03.
Section 10.05. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Estate or any Financed Vehicle 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 Administrator and Owner Trustee to act as co-trustee, jointly
with the Owner Trustee, or as separate trustee or separate trustees, of all or
any part of the Trust Estate, and to vest in such Person, in such capacity,
such title to the Trust Estate or any part thereof and, subject to the other
provisions of this Section, 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 Owner Trustee pursuant to Section 10.01 and no
notice of the appointment of any co-trustee or separate trustee shall be
required pursuant to Section 10.03.
Each separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and
conditions:
(a) All rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred upon and exercised
or performed by the Owner Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Owner
Trustee joining in such act), except to the extent that under any law
of any jurisdiction in which any particular act or acts are to be
performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties
and obligations (including the holding of title to the Trust Estate
or any portion thereof in any such jurisdiction) shall be exercised
and performed singly by such separate trustee or co-trustee, but
solely at the direction of the Owner Trustee;
(b) No trustee under this Agreement shall be personally
liable by reason of any act or omission of any other trustee under
this Agreement; and
(c) The Administrator and the Owner Trustee acting jointly
may at any time accept the resignation of or remove any separate
trustee or co-trustee.
Any notice, request or other writing given to the Owner Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Owner Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Owner Trustee. Each such instrument shall be filed with the
Owner Trustee and a copy thereof given to the Administrator.
Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Owner Trustee, to the extent permitted by law, without the
appointment of a new or successor co-trustee or separate trustee.
ARTICLE XI
MISCELLANEOUS
Section 11.01. Supplements and Amendments. This Agreement may be
amended by the Depositor and the Owner Trustee, with prior written notice to
each Rating Agency, without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Agreement or for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions in this Agreement
or of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that such action shall not, as
evidenced by the satisfaction of the Rating Agency Condition with respect to
such amendment, adversely affect in any material respect the interests of any
Noteholder or Certificateholder; provided, further, that such amendment shall
not be deemed to adversely affect in any material respect the interest of any
Noteholder or Certificateholder if the person requesting such amendment
obtains a letter from the Rating Agencies stating that the amendment would not
result in the downgrading withdrawal of the ratings then assigned to the Notes
and Certificates.
This Agreement may also be amended from time to time by the Depositor
and the Owner Trustee, with prior written notice to each Rating Agency, with
the consent of the Holders (as defined in the Indenture) of Notes evidencing
not less than a majority of the Outstanding Amount of the Notes and the
consent of the Holders of Certificates evidencing not less than a majority of
the Certificate Balance, for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement
or of modifying in any manner the rights of the 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, collections of payments on Receivables or distributions that shall
be required to be made for the benefit of the Noteholders or the
Certificateholders or (b) reduce the aforesaid percentage of the Outstanding
Amount of the Notes and the Certificate Balance required to consent to any
such amendment, without the consent of the Holders of all then-outstanding
Notes and Certificates.
Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Indenture Trustee and each
Rating Agency.
It shall not be necessary for the consent of Certificateholders or
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent
shall approve the substance thereof. The manner of obtaining such consents
(and any other consents of Certificateholders provided for in this Agreement
or in any other Basic Document) and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
requirements as the Owner Trustee may prescribe.
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.
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 that affects the Owner
Trustee's own rights, duties or immunities under this Agreement or otherwise.
In connection with the execution of any amendment to this Trust
Agreement or any amendment of any other agreement to which the Issuer is a
party, the Owner Trustee shall be entitled to receive and conclusively rely
upon an Opinion of Counsel to the effect that such amendment is authorized or
permitted by the Basic Documents and that all conditions precedent in the
Basic Documents for the execution and delivery thereof by the Trust or the
Owner Trustee, as the case may be, have been satisfied.
Any amendment, modification or waiver of any provision of this Trust
Agreement shall require the prior written consent of the holder of the
Residual Interest, which initially shall be BMW FS Receivables Corporation.
Section 11.02. No Legal Title to Trust Estate in Certificateholders.
Neither the Depositor nor the Certificateholders shall have legal title to any
part of the 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 IX. No transfer, by operation of law or
otherwise, of any right, title or interest of the Certificateholders to and in
their ownership interest in the 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 Trust Estate.
Section 11.03. Limitations on Rights of Others. The provisions of
this Agreement are solely for the benefit of the Owner Trustee, the Depositor,
the 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 Trust Estate
or under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.
Section 11.04. Notices.
(a) Unless otherwise expressly specified or permitted by the terms
hereof, all notices shall be in writing and shall be deemed given upon receipt
by the intended recipient or three Business Days after mailing if mailed by
certified mail, postage prepaid (except that notice to the Owner Trustee shall
be deemed given only upon actual receipt by the Owner Trustee), if to the
Owner Trustee, addressed to the Corporate Trust Office; if to the Depositor,
addressed to Seven World Trade Center, New York, New York; telephone (212)
783-7000; or, as to each party, at such other address as shall be designated
by such party in a written notice to each other party. A copy of any such
notice shall also be mailed to the Servicer, addressed to the attention of
Vice President Risk & Finance, 300 Chestnut Ridge Road, Woodcliff Lake, NJ
07675.
(b) Any notice required or permitted to be given to a
Certificateholder shall be given by first-class mail, postage prepaid, at the
address of such Certificateholder as shown in the Certificate Register. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not such
Certificateholder receives such notice.
Section 11.05. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
Section 11.06. Separate Counterparts. This Agreement may be executed
by the parties hereto in separate counterparts, each of which when so executed
and delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
Section 11.07. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, each of
the Depositor and its permitted assignees, the Owner Trustee and its
successors and each Certificateholder and its 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 11.08. Covenants of the Depositor. The Depositor will not at
any time institute against the Trust any bankruptcy proceedings under any
United States federal or state bankruptcy or similar law in connection with
any obligations relating to the Trust Certificates, the Notes, this Agreement
or any of the other Basic Documents.
Section 11.09. No Petition. The Owner Trustee, by entering into this
Agreement, each Certificateholder, by accepting a Trust Certificate, and the
Indenture Trustee and each Noteholder, by accepting the benefits of this
Agreement, hereby covenant and agree that they will not at any time institute
against the Depositor or the Trust or join in any institution against the
Depositor or the Trust of, any bankruptcy proceedings under any United States
federal or state bankruptcy or similar law in connection with any obligations
relating to the Trust Certificates, the Notes, this Agreement or any of the
Basic Documents.
Section 11.10. No Recourse. Each Certificateholder by accepting a
Trust Certificate acknowledges that such Trust Certificate represents a
beneficial interest in the Trust only and does not represent an interest in or
an obligation of the Depositor, the Servicer, the Administrator, the Owner
Trustee, the Indenture Trustee or any Affiliate thereof and no recourse may be
had against such parties or their assets, except as may be expressly set forth
or contemplated in this Agreement, the Trust Certificates or the Basic
Documents.
Section 11.11. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
Section 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.13. Trust Certificate Transfer Restrictions. The Trust
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 Trust Certificate, the Holder thereof shall be deemed
to have represented and warranted that it is not a Benefit Plan.
Section 11.14. Third Party Beneficiary. The holder of the Residual
Interest shall be a third party beneficiary of this Trust Agreement.
<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.
SSB VEHICLE SECURITIES INC.,
as Depositor
By:
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Name:
Title:
WILMINGTON TRUST COMPANY,
as Owner Trustee
By:
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Name:
Title:
<PAGE>
EXHIBIT A
FORM OF TRUST CERTIFICATE
THIS TRUST CERTIFICATE IS SUBORDINATE TO THE NOTES, AS SET FORTH IN THE SALE
AND SERVICING AGREEMENT.
UNLESS THIS TRUST CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY TRUST
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE TRUST CERTIFICATES 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 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 TRUST CERTIFICATE, THE HOLDER THEREOF SHALL BE DEEMED
TO HAVE REPRESENTED AND WARRANTED THAT IT IS NOT A BENEFIT PLAN.
<PAGE>
NUMBER
INITIAL CERTIFICATE BALANCE: $33,400,000
Pass-Through Rate: 6.91%
R-1
CUSIP NO. 055 959 AE0
ISIN NO. US 055 959 AE09
BMW VEHICLE OWNER TRUST 1999-A
ASSET BACKED CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined below, the
property of which consists of: (1) the Receivables and all moneys received
thereon on or after the Cutoff Date; (2) the security interests in the
Financed Vehicles and any accessions thereto granted by Obligors pursuant to
the Receivables and any other interest of the Depositor in such Financed
Vehicles; (3) any Liquidation Proceeds and any other proceeds with respect to
the Receivables from claims on any physical damage, credit life or disability
insurance policies covering the Financed Vehicles or the related Obligors,
including any vendor's single interest or other collateral protection
insurance policy; (4) any property that shall have secured a Receivable and
shall have been acquired by or on behalf of the Depositor, the Servicer or the
Trust; (5) all documents and other items contained in the Receivable Files;
(6) all of the Depositor's rights (but not its obligations) under the
Receivables Purchase Agreement; (7) all right, title and interest in all funds
on deposit from time to time in the Trust Accounts and the Certificate
Distribution Account and in all investments therein and proceeds thereof
(including all Investment Earnings thereon); (8) any proceeds from any
Receivable repurchased by a Dealer pursuant to a Dealer Agreement; and (9) the
proceeds of any and all of the foregoing.
THIS TRUST CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR AN OBLIGATION OF
SSB VEHICLE SECURITIES INC., BMW FINANCIAL SERVICES NA, INC., WILMINGTON TRUST
COMPANY OR ANY OF THEIR RESPECTIVE AFFILIATES.
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a
THIRTY-THREE MILLION FOUR-HUNDRED THOUSAND DOLLAR nonassessable, fully paid,
fractional undivided interest in BMW VEHICLE OWNER TRUST 1999-A (the "Trust"),
formed by SSB VEHICLE SECURITIES INC., a Delaware corporation (the
"Depositor").
The Trust was created pursuant to a Trust Agreement dated as of
September 1, 1999 (as amended or supplemented from time to time, the "Trust
Agreement"), between the Depositor and Wilmington Trust Company, as owner
trustee (the "Owner Trustee"), a summary of certain of the pertinent
provisions of which is set forth below. To the extent not otherwise defined
herein, the capitalized terms used herein have the meanings assigned to them
in the Trust Agreement or the Sale and Servicing Agreement dated as of
September 1, 1999 (as amended and supplemented from time to time, the "Sale
and Servicing Agreement"), among the Trust, the Depositor, BMW Financial
Services NA, Inc., as Servicer, Seller, Custodian and Administrator, BMW FS
Funding Corporation, Delaware, as Seller, and The Chase Manhattan Bank, as
Indenture Trustee, as applicable.
This Trust Certificate is one of the duly authorized Trust
Certificates designated as "Asset Backed Certificates" (herein called the
"Trust Certificates"). Also issued under an Indenture dated as of September 1,
1999 (the "Indenture"), between the Trust and The Chase Manhattan Bank, as
indenture trustee, are the four classes of Notes designated as "5.64% Asset
Backed Notes, Class A-1," "6.16% Asset Backed Notes, Class A-2," "6.41% Asset
Backed Notes, Class A-3" and "6.54% Asset Backed Notes, Class A-4"
(collectively, the "Notes"). This Trust Certificate is issued under and is
subject to the terms, provisions and conditions of the Trust Agreement, to
which Trust Agreement the Holder of this Trust Certificate by virtue of its
acceptance hereof assents and by which such Certificateholder is bound. The
property of the Trust consists of the Receivables and all monies received
thereon after August 31, 1999, security interests in the related Financed
Vehicles, certain bank accounts and the proceeds thereof, proceeds from claims
on certain insurance policies and certain other rights under the Trust
Agreement and the Sale and Servicing Agreement and all proceeds of the
foregoing. The rights of the Certificateholders are subordinate to the rights
of the Noteholders, as set forth in the Sale and Servicing Agreement.
Under the Trust Agreement, there will be distributed on the 25th day
of each month or, if such 25th day is not a Business Day, the next Business
Day (each, a "Distribution Date"), commencing on October 25, 1999, to the
Person in whose name this Trust Certificate is registered on the last day of
the immediately preceding month (the "Record Date"), such Certificateholder's
fractional undivided interest in the amount to be distributed to
Certificateholders on such Distribution Date.
The Holder of this Trust Certificate acknowledges and agrees that its
rights to receive distributions in respect of this Trust Certificate are
subordinate to the rights of the Noteholders as described in the Sale and
Servicing Agreement and the Indenture.
It is the intent of the Depositor, the Servicer and the
Certificateholders that at such time as there is more than one holder of an
equity interest including any Certificates in the Trust, for purposes of
federal income, state and local income and single business tax and any other
income taxes, the Trust will be treated as a partnership and the
Certificateholders will be treated as partners in that partnership. A
Certificateholder, by its acceptance of a Trust Certificate, agrees to treat,
and to take no action inconsistent with such treatment of the Trust for such
tax purposes.
Each Certificateholder, by its acceptance of a Trust Certificate,
agrees to treat, and to take no action inconsistent with the treatment of, the
Trust Certificates for such tax purposes as partnership interests in the
Trust.
A Certificateholder, by its acceptance of a Trust Certificate,
covenants and agrees that such Certificateholder will not at any time
institute against the Depositor or the Trust, or join in any institution
against the Depositor or the Trust of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any United States federal or state bankruptcy or similar law in connection
with any obligations relating to the Trust Certificates, the Notes, the Trust
Agreement or any of the Basic Documents.
Distributions on this Trust Certificate will be made as provided in
the Trust Agreement by the Owner Trustee or Paying Agent by wire transfer or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Trust Certificate or the making
of any notation hereon. Except as otherwise provided in the Trust Agreement
and notwithstanding the above, the final distribution on this Trust
Certificate will be made after due notice by the Owner Trustee of the pendency
of such distribution and only upon presentation and surrender of this Trust
Certificate at the office or agency designated for that purpose by the Owner
Trustee in the Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this Trust
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee, by manual signature,
this Trust Certificate shall not entitle the Holder hereof to any benefit
under the Trust Agreement or the Sale and Servicing Agreement or be valid for
any purpose.
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
<PAGE>
IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not
in its individual capacity, has caused this Trust Certificate to be duly
executed.
BMW VEHICLE OWNER TRUST 1999-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely
as Owner Trustee
Dated: By:
----------------------------------------
Authorized Signatory
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the within-mentioned
Trust Agreement.
WILMINGTON TRUST COMPANY, WILMINGTON TRUST COMPANY,
as Owner Trustee or as Owner Trustee
By: The Chase Manhattan Bank, as
Authenticating Agent
By: -------------------------- By: ----------------------------------
Authorizing Agent Authorizing Agent
<PAGE>
[REVERSE OF TRUST CERTIFICATE]
The Trust Certificates do not represent an obligation of, or an
interest in, the Depositor, the Servicer, the Owner Trustee or any affiliates
of any of them and no recourse may be had against such parties or their
assets, except as expressly set forth or contemplated herein or in the Trust
Agreement or the Basic Documents. In addition, this Trust Certificate is not
guaranteed by any governmental agency or instrumentality and is limited in
right of payment to certain collections and recoveries with respect to the
Receivables (and certain other amounts), all as more specifically set forth
herein and in the Sale and Servicing Agreement. A copy of each of the Sale and
Servicing Agreement and the Trust Agreement may be examined by any
Certificateholder upon written request during normal business hours at the
principal office of the Depositor and at such other places, if any, designated
by the Depositor.
The Trust Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the rights of Certificateholders under the
Trust Agreement at any time by the Depositor and the Owner Trustee with the
consent of the Holders of the Trust Certificates and the Notes, each voting as
a class, evidencing not less than a majority of the Certificate Balance and
the outstanding principal balance of the Notes of each class. Any such consent
by the Holder of this Trust Certificate shall be conclusive and binding on
such Holder and on all future Holders of this Trust Certificate and of any
Trust Certificate issued upon the transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent is made upon this Trust
Certificate. The Trust Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of
the Trust Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Trust Certificate is registerable in
the Certificate Register upon surrender of this Trust Certificate for
registration of transfer at the offices or agencies of the Certificate
Registrar designated by the Owner Trustee in the Borough of Manhattan, The
City of New York, accompanied by a written instrument of transfer in form
satisfactory to the Owner Trustee and the Certificate Registrar duly executed
by the Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Trust 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 Chase Manhattan Bank, New York, New York.
Except as provided in the Trust Agreement, the Trust Certificates are
issuable only as registered Trust Certificates without coupons in
denominations of $1,000,000 and in integral multiples of $1,000 in excess
thereof; provided, however, that a single Trust Certificate may be issued in
such denomination as required to include any residual amount. As provided in
the Trust Agreement and subject to certain limitations therein set forth,
Trust Certificates are exchangeable for new Trust Certificates of authorized
denominations evidencing the same aggregate denomination, as requested by the
Certificateholder surrendering the same. No service charge will be made for
any such registration of transfer or exchange, but the Owner Trustee or the
Certificate Registrar may require payment of a sum sufficient to cover any tax
or governmental charge payable in connection therewith.
The Owner Trustee, the Certificate Registrar and any agent of the
Owner Trustee or the Certificate Registrar may treat the Person in whose name
this Trust Certificate is registered as the owner hereof for all purposes, and
none of the Owner Trustee, the Certificate Registrar or any such agent shall
be affected by any notice to the contrary.
The obligations and responsibilities created by the Trust Agreement
and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Sale and Servicing Agreement and the disposition of
all property held as part of the Trust Estate. The Servicer of the Receivables
may at its option purchase the Trust Estate at a price specified in the Sale
and Servicing Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement of the Trust Certificates;
provided, however, that such right of purchase is exercisable only as of the
last day of any Collection Period as of which the Pool Balance is less than or
equal to 10% of the Original Pool Balance.
The Trust Certificates may not be acquired by (a) an employee benefit
plan (as defined in Section 3(3) of ERISA) that is subject to the provisions
of Title 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 the entity or which uses plan assets to acquire Trust
Certificates (each, a "Benefit Plan"). By accepting and holding this Trust
Certificate, the Holder hereof shall be deemed to have represented and
warranted that it is not a Benefit Plan.
<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 Trust Certificate, and all rights thereunder, and hereby
irrevocably constitutes and appoints ____________, attorney, to transfer said
Trust Certificate on the books of the Certificate Registrar, with full power
of substitution in the premises.
Dated:
------------------------------------------*/
Signature Guaranteed:
------------------------------------------*/
------------------------
*/ NOTICE: The signature to this assignment must
correspond with the name of the registered owner as
it appears on the face of the within Trust
Certificate in every particular, without alteration,
enlargement or any change whatever. Such signature
must be guaranteed by an "eligible guarantor
institution" meeting the requirements of the
Certificate Registrar, which requirements include
membership or participation in STAMP or such other
"signature guarantee program" as may be determined by
the Certificate Registrar in addition to, or in
substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
<PAGE>
EXHIBIT B
FORM OF CERTIFICATE OF TRUST OF BMW VEHICLE OWNER TRUST 1999-A
This CERTIFICATE OF TRUST of BMW VEHICLE OWNER TRUST 1999-A (the
"Trust"), dated September ___, 1999, is being duly executed and filed by
[Wilmington Trust Company], a Delaware banking corporation, as trustee, to
form a business trust under the Delaware Business Trust Act (12 Del. Code, ss.
3801 et seq.).
1. Name. The name of the business trust formed hereby is BMW VEHICLE
OWNER TRUST 1999-A.
2. Delaware Trustee. The name and business address of the trustee of
the Trust in the State of Delaware is [Wilmington Trust Company, Rodney Square
North, 1100 North Market Street, Wilmington, Delaware 19890-0001], Attention:
Corporate Trust Administration.
3. Effective Date. This Certificate of Trust shall be effective upon
filing with the Secretary of State.
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.
[WILMINGTON TRUST COMPANY],
as trustee
By:
--------------------------------------------------
Name:
Title:
Exhibit 10.1
EXECUTION COPY
SALE AND SERVICING AGREEMENT
among
BMW VEHICLE OWNER TRUST 1999-A,
Issuer,
SSB VEHICLE SECURITIES INC.,
Depositor,
BMW FINANCIAL SERVICES NA, INC.,
Seller, Servicer, Administrator and Custodian,
BMW FS FUNDING CORPORATION,
Seller
and
THE CHASE MANHATTAN BANK,
Indenture Trustee
Dated as of September 1, 1999
<PAGE>
<TABLE>
<CAPTION>
Table of Contents
Page
----
ARTICLE I
DEFINITIONS
<S> <C>
Section 1.01. Definitions............................................................................1
Section 1.02. Other Definitional Provisions.........................................................20
ARTICLE II
CONVEYANCE OF RECEIVABLES
Section 2.01. Conveyance of Receivables.............................................................22
ARTICLE III
THE RECEIVABLES
Section 3.01. Representations and Warranties of the Sellers.........................................25
Section 3.02. Representations and Warranties of the Depositor.......................................25
Section 3.03. Repurchase Upon Breach................................................................26
Section 3.04. Custody of Receivable Files...........................................................26
Section 3.05. Duties of Servicer as Custodian.......................................................26
Section 3.06. Instructions; Authority to Act........................................................27
Section 3.07. Custodian's Indemnification...........................................................27
Section 3.08. Effective Period and Termination......................................................27
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
Section 4.01. Duties of Servicer....................................................................29
Section 4.02. Collection of Receivable Payments; Modifications of Receivables.......................30
Section 4.03. Realization upon Receivables..........................................................31
Section 4.04. Physical Damage Insurance.............................................................31
Section 4.05. Maintenance of Security Interests in Financed Vehicles................................31
Section 4.06. Covenants of Servicer.................................................................32
Section 4.07. Purchase of Receivables Upon Breach...................................................32
Section 4.08. Servicing Fee.........................................................................33
Section 4.09. Servicer's Certificate................................................................33
Section 4.10. Annual Statement as to Compliance; Notice of Servicer Termination Event...............33
Section 4.11. Annual Independent Accountants' Report................................................34
Section 4.12. Access to Certain Documentation and Information Regarding Receivables.................34
Section 4.13. Term of Servicer......................................................................34
Section 4.14. Access to Information Regarding Trust and Basic Documents.............................34
ARTICLE V
DISTRIBUTIONS; STATEMENTS TO SECURITYHOLDERS
Section 5.01. Establishment of Accounts.............................................................35
Section 5.02. Collections...........................................................................37
Section 5.03. Application of Collections............................................................37
Section 5.04. Purchase Amounts......................................................................37
Section 5.05. Reserved..............................................................................38
Section 5.06. Distributions.........................................................................38
Section 5.07. Reserve Account.......................................................................39
Section 5.08. Statements to Securityholders.........................................................40
Section 5.09. Pre-Funding Account...................................................................41
Section 5.10. Capitalized Interest Account..........................................................42
Section 5.11. Certificate Interest Reserve Account..................................................42
Section 5.12. Advances by the Servicer..............................................................43
ARTICLE VI
THE DEPOSITOR
Section 6.01. Representations of Depositor..........................................................44
Section 6.02. Corporate Existence...................................................................45
Section 6.03. Liability of Depositor; Indemnities...................................................45
Section 6.04. Merger or Consolidation of, or Assumption of the Obligations of, Depositor............45
Section 6.05. Limitation on Liability of Depositor and Others.......................................46
Section 6.06. Depositor May Own Securities..........................................................46
Section 6.07. Depositor to Provide Copies of Relevant Securities Filings............................46
Section 6.08. Amendment of Depositor's Organizational Documents.....................................46
ARTICLE VII
THE SERVICER
Section 7.01. Representations of Servicer...........................................................47
Section 7.02. Indemnities of Servicer...............................................................48
Section 7.03. Merger or Consolidation of, or Assumption of the Obligations of, Servicer.............49
Section 7.04. Limitation on Liability of Servicer and Others........................................49
Section 7.05. Appointment of Subservicer............................................................50
Section 7.06. Servicer Not to Resign................................................................50
ARTICLE VIII
DEFAULT
Section 8.01. Servicer Termination Events...........................................................51
Section 8.02. Consequences of a Servicer Termination Event..........................................51
Section 8.03. Appointment of Successor Servicer.....................................................52
Section 8.04. Notification to Securityholders.......................................................52
Section 8.05. Waiver of Past Defaults...............................................................53
ARTICLE IX
TERMINATION
Section 9.01. Optional Purchase of All Receivables..................................................54
ARTICLE X
MISCELLANEOUS
Section 10.01. Amendment.............................................................................55
Section 10.02. Protection of Title to Trust..........................................................56
Section 10.03. Notices...............................................................................57
Section 10.04. Assignment by the Depositor or the Servicer...........................................58
Section 10.05. Limitations on Rights of Others.......................................................58
Section 10.06. Severability..........................................................................58
Section 10.07. Counterparts..........................................................................58
Section 10.08. Headings..............................................................................58
Section 10.09. GOVERNING LAW.........................................................................58
Section 10.10. Assignment by Issuer..................................................................58
Section 10.11. Nonpetition Covenants.................................................................58
Section 10.12. Limitation of Liability of Owner Trustee and Indenture Trustee........................59
Section 10.13. Depositor Payment Obligation..........................................................59
</TABLE>
<PAGE>
This SALE AND SERVICING AGREEMENT, dated as of September 1, 1999, among
BMW VEHICLE OWNER TRUST 1999-A, a Delaware business trust (the "Issuer"), SSB
VEHICLE SECURITIES INC., a Delaware corporation (the "Depositor"), BMW
FINANCIAL SERVICES NA, INC., a Delaware corporation, as a seller (in such
capacity, a "Seller"), as servicer (in such capacity, the "Servicer"), as
administrator (in such capacity, the "Administrator") and as custodian (in
such capacity, the "Custodian"), BMW FS FUNDING CORPORATION, as a seller (a
"Seller"), and THE CHASE MANHATTAN BANK, a New York banking corporation, as
indenture trustee (the "Indenture Trustee").
WHEREAS, the Issuer desires to purchase a portfolio of receivables
arising in connection with automobile retail installment sale contracts
generated by BMW Financial Services NA, Inc. in the ordinary course of its
business and sold by BMW Financial Services NA, Inc. and BMW FS Funding
Corporation to the Depositor;
WHEREAS, the Depositor is willing to sell such receivables to the Issuer;
and
WHEREAS, BMW Financial Services NA, Inc. is willing to service such
receivables.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. Whenever used in this Agreement, the following
words and phrases, unless the context otherwise requires, shall have the
following meanings:
"Addition Notice" means, with respect to any transfer of Subsequent
Receivables to the Trust pursuant to Section 2.01, notice of the Depositor's
election to transfer Subsequent Receivables to the Trust, such notice to
designate the Subsequent Transfer Date and the (1) Principal Balance of the
Subsequent Receivables and (2) the Reserve Account Subsequent Deposit Amount
to be transferred on the Subsequent Transfer Date.
"Advance" means, as to any Distribution Date, the aggregate of all
scheduled payments of interest which were due during the related Collection
Period that remained unpaid at the end of such Collection Period and were not
collected during such Collection Period, exclusive of any such scheduled
payment which the Servicer has determined would be a Nonrecoverable Advance if
an advance in respect of such scheduled payment were made.
"Advance Reimbursement Amount" means any amount received or deemed to be
received by the Servicer pursuant to Section 5.12 in reimbursement of a
Advance made out of its own funds.
"Agreement" means this Sale and Servicing Agreement, as the same may be
amended or supplemented from time to time.
"Amount Financed" means with respect to a Receivable, the amount advanced
under the Receivable toward the purchase price of the Financed Vehicle and any
related costs, exclusive of any amount allocable to the premium of
force-placed physical damage insurance covering the Financed Vehicle.
"Annual Percentage Rate" or "APR" of a Receivable means the annual rate
of finance charges stated in the related Contract.
"Balloon Payment" means, with respect to each Owners Choice Receivable,
the amount referred to in the Contract relating to such Receivable as the
"Balloon Payment".
"Basic Documents" means the Trust Agreement, the Indenture, this
Agreement, the Receivables Purchase Agreement, the Administration Agreement,
and the Note Depository Agreement and other documents and certificates
delivered in connection therewith.
"BMW Capital" means BMW US Capital Corp., a Delaware corporation.
"BMW FS" means BMW Financial Services NA, Inc., a Delaware corporation.
"BMW Receivables" means BMW FS Receivables Corporation, a Delaware
corporation.
"BMW Funding" means BMW FS Funding Corporation, a Delaware corporation.
"Business Day" means any day other than a Saturday, a Sunday or a day on
which a national banking association or a commercial banking institution in
the State of New Jersey, the State of Delaware or the State of New York are
authorized or obligated by law or executive order to remain closed.
"Capitalized Interest Account" means the account designated as such,
established and maintained pursuant to Section 5.01(c)(iii).
"Capitalized Interest Account Required Amount" shall mean the product of
(A) the product of (i) 3.8543% times 30/360 (or 26/360 in the case of the
initial Distribution Date) and (ii) the amount in the Pre-Funding Account and
(B) the number of months remaining in the Funding Period plus one month.
"Capitalized Interest Distribution Amount" shall mean for each
Determination Date and related Distribution Date during the Funding Period,
the amount equal to (A) the product of (i) 1/12, (ii) the Weighted Average
Security Rate less 2.5% and (iii) the amount on deposit in the Pre-Funding
Account as of the first day of the related Collection Period.
"Capitalized Interest Initial Deposit" shall mean $2,509,221.
"Certificate" means a certificate evidencing the beneficial interest of a
Certificateholder in the Trust.
"Certificate Balance" equals the Initial Certificate Balance reduced by
all amounts allocable to principal previously distributed to
Certificateholders.
"Certificate Distribution Account" has the meaning assigned to such term
in the Trust Agreement.
"Certificate Final Scheduled Distribution Date" means the Distribution
Date in May 2006.
"Certificate Interest Reserve Account" means the account designated as
such, established and maintained pursuant to Section 5.01(c)(iv).
"Certificate Interest Reserve Account Required Amount" means, on any
Distribution Date prior to the date on which the Notes are retired,
$1,153,970, and thereafter, zero.
"Certificate Pool Factor" means, as of the close of business on the last
day of a Collection Period, a seven-digit decimal figure equal to the
Certificate Balance (after giving effect to any reductions therein to be made
on the immediately following Distribution Date) divided by the Initial
Certificate Balance. The Certificate Pool Factor will be 1.0000000 as of the
Closing Date; thereafter, the Certificate Pool Factor will decline to reflect
reductions in the Certificate Balance.
"Certificateholder Interest Shortfall" shall have the meaning ascribed
thereto in Section 5.11(b).
"Certificateholders" has the meaning assigned to such term in the Trust
Agreement.
"Certificateholders' Interest Carryover Shortfall" means, with respect to
any Distribution Date after the first Distribution Date, the amount, if any,
by which the sum of the Certificateholders' Monthly Interest Distributable
Amount for the immediately preceding Distribution Date and any outstanding
Certificateholders' Interest Carryover Shortfall on such preceding
Distribution Date exceeds the amount in respect of interest actually deposited
in the Certificate Distribution Account on such preceding Distribution Date,
plus interest on the amount of interest due but not paid to the
Certificateholders on such preceding Distribution Date, to the extent
permitted by law, at the Pass-Through Rate.
"Certificateholders' Interest Distributable Amount" means, with respect
to any Distribution Date, the sum of the Certificateholders' Monthly Interest
Distributable Amount for such Distribution Date and the Certificateholders'
Interest Carryover Shortfall for such Distribution Date.
"Certificateholders' Monthly Interest Distributable Amount" means, with
respect to any Distribution Date, interest accrued from and including the 25th
day of the preceding calendar month (or, in the case of the first Distribution
Date, from and including the Closing Date) to and including the 24th day of
the calendar month in which such Distribution Date occurs, on the Certificates
at the Pass-Through Rate on the Certificate Balance on the immediately
preceding Distribution Date (or, in the case of the first Distribution Date,
the Closing Date), after giving effect to all distributions of principal to
the Certificateholders on or prior to such preceding Distribution Date.
Interest with respect to the Certificates shall be computed on the basis of a
360-day year consisting of twelve 30-day months for all purposes of this
Agreement and the Basic Documents.
"Certificateholders' Principal Distributable Amount" means (a) on any
Distribution Date prior to the date on which the Notes have been retired, zero
and (b) on any Distribution Date on and after the Distribution Date on which
the Notes have been retired, the excess, if any, of (x) the aggregate
Outstanding Amount of the Certificates as of the day immediately prior to such
Distribution Date over (y) the sum of the Pool Balance as of the end of the
related Collection Period and the amount, if any, on deposit in the
Pre-Funding Account less the Yield Supplement Overcollateralization Amount
with respect to such Distribution Date; provided, however, that the
Certificateholders' Principal Distributable Amount shall not exceed the
Certificate Balance. In addition, on the Certificate Final Scheduled
Distribution Date, the principal required to be included in the
Certificateholders' Principal Distributable Amount will include the amount
that is necessary (after giving effect to the other amounts to be Certificate
Distribution Account on such Distribution Date and allocable to principal) to
reduce the Certificate Balance to zero.
"Class" means any one of the classes of Notes.
"Class A-1 Final Scheduled Distribution Date" means the Distribution Date
in August 2000.
"Class A-1 Interest Carryover Shortfall" means, with respect to any
Distribution Date, the amount, if any, by which the sum of the Class A-1
Monthly Interest Distributable Amount for the preceding Distribution Date and
any outstanding Class A-1 Interest Carryover Shortfall on such preceding
Distribution Date exceeds the amount in respect of interest for the Class A-1
Notes actually deposited in the Note Distribution Account on such preceding
Distribution Date, plus interest on the amount of interest due but not paid to
the Class A-1 Noteholders on such preceding Distribution Date, to the extent
permitted by law, at the Class A-1 Rate.
"Class A-1 Interest Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class A-1 Monthly Interest Distributable
Amount for such Distribution Date and the Class A-1 Interest Carryover
Shortfall for such Distribution Date.
"Class A-1 Monthly Interest Distributable Amount" means, with respect to
any Distribution Date, interest accrued from and including the prior
Distribution Date (or, in the case of the first Distribution Date, from and
including the Closing Date) to and including the day immediately prior to such
Distribution Date, on the Class A-1 Notes at the Class A-1 Rate on the
Outstanding Amount of the Class A-1 Notes on the immediately preceding
Distribution Date (or, in the case of the first Distribution Date, the Closing
Date), after giving effect to all distributions of principal to the Class A-1
Noteholders on or prior to such preceding Distribution Date. For all purposes
of this Agreement and the other Basic Documents, interest with respect to the
Class A-1 Notes shall be computed on the basis of the actual number of days in
the related Interest Accrual Period and a 360-day year.
"Class A-1 Note Balance" means, as of any date of determination, the
Initial Class A-1 Note Balance less all amounts distributed to Class A-1
Noteholders on or prior to such date and allocable to principal.
"Class A-1 Noteholder" means the Person in whose name a Class A-1 Note is
registered in the Note Register.
"Class A-1 Notes" means the 5.64% Asset Backed Notes, Class A-1,
substantially in the form of Exhibit A-1 to the Indenture.
"Class A-1 Rate" means 5.64% per annum.
"Class A-2 Final Scheduled Distribution Date" means the Distribution Date
in December 2001.
"Class A-2 Interest Carryover Shortfall" means, with respect to any
Distribution Date, the amount, if any, by which the sum of the Class A-2
Monthly Interest Distributable Amount for the preceding Distribution Date and
any outstanding Class A-2 Interest Carryover Shortfall on such preceding
Distribution Date exceeds the amount in respect of interest for the Class A-2
Notes actually deposited in the Note Distribution Account on such preceding
Distribution Date, plus interest on the amount of interest due but not paid to
the Class A-2 Noteholders on such preceding Distribution Date, to the extent
permitted by law, at the Class A-2 Rate.
"Class A-2 Interest Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class A-2 Monthly Interest Distributable
Amount for such Distribution Date and the Class A-2 Interest Carryover
Shortfall for such Distribution Date.
"Class A-2 Monthly Interest Distributable Amount" means, with respect to
any Distribution Date, interest accrued from and including the 25th day of the
preceding calendar month (or, in the case of the first Distribution Date, from
and including the Closing Date) to and including the 24th day of the calendar
month in which such Distribution Date occurs, on the Class A-2 Notes at the
Class A-2 Rate on the Outstanding Amount of the Class A-2 Notes on the
immediately preceding Distribution Date (or, in the case of the first
Distribution Date, the Closing Date), after giving effect to all distributions
of principal to the Class A-2 Noteholders on or prior to such preceding
Distribution Date. For all purposes of this Agreement and the other Basic
Documents, interest with respect to the Class A-2 Notes shall be computed on
the basis of a 360-day year consisting of twelve 30-day months.
"Class A-2 Noteholder" means the Person in whose name a Class A-2 Note is
registered in the Note Register.
"Class A-2 Notes" means the 6.16% Asset Backed Notes, Class A-2,
substantially in the form of Exhibit A-2 to the Indenture.
"Class A-2 Rate" means 6.16% per annum.
"Class A-3 Final Scheduled Distribution Date" means the Distribution Date
in April 2003.
"Class A-3 Interest Carryover Shortfall" means, with respect to any
Distribution Date, the amount, if any, by which the sum of the Class A-3
Monthly Interest Distributable Amount for the preceding Distribution Date and
any outstanding Class A-3 Interest Carryover Shortfall on such preceding
Distribution Date exceeds the amount in respect of interest for the Class A-3
Notes actually deposited in the Note Distribution Account on such preceding
Distribution Date, plus interest on the amount of interest due but not paid to
the Class A-3 Noteholders on such preceding Distribution Date, to the extent
permitted by law, at the Class A-3 Rate.
"Class A-3 Interest Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class A-3 Monthly Interest Distributable
Amount for such Distribution Date and the Class A-3 Interest Carryover
Shortfall for such Distribution Date.
"Class A-3 Monthly Interest Distributable Amount" means, with respect to
any Distribution Date, interest accrued from and including the 25th day of the
preceding calendar month (or, in the case of the first Distribution Date, from
and including the Closing Date) to and including the 24th day of the calendar
month in which such Distribution Date occurs, on the Class A-3 Notes at the
Class A-3 Rate on the Outstanding Amount of the Class A-3 Notes on the
immediately preceding Distribution Date (or, in the case of the first
Distribution Date, the Closing Date), after giving effect to all distributions
of principal to the Class A-3 Noteholders on or prior to such preceding
Distribution Date. For all purposes of this Agreement and the other Basic
Documents, interest with respect to the Class A-3 Notes shall be computed on
the basis of a 360-day year consisting of twelve 30-day months.
"Class A-3 Noteholder" means the Person in whose name a Class A-3 Note is
registered in the Note Register.
"Class A-3 Notes" means the 6.41% Asset Backed Notes, Class A-3,
substantially in the form of Exhibit A-3 to the Indenture.
"Class A-3 Rate" means 6.41% per annum.
"Class A-4 Final Scheduled Distribution Date" means the Distribution Date
in April 2004.
"Class A-4 Interest Carryover Shortfall" means, with respect to any
Distribution Date, the amount, if any, by which the sum of the Class A-4
Monthly Interest Distributable Amount for the preceding Distribution Date and
any outstanding Class A-4 Interest Carryover Shortfall on such preceding
Distribution Date exceeds the amount in respect of interest for the Class A-4
Notes actually deposited in the Note Distribution Account on such preceding
Distribution Date, plus interest on the amount of interest due but not paid to
the Class A-4 Noteholders on such preceding Distribution Date, to the extent
permitted by law, at the Class A-4 Rate.
"Class A-4 Interest Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class A-4 Monthly Interest Distributable
Amount for such Distribution Date and the Class A-4 Interest Carryover
Shortfall for such Distribution Date.
"Class A-4 Monthly Interest Distributable Amount" means, with respect to
any Distribution Date, interest accrued from and including the 25th day of the
preceding calendar month (or, in the case of the first Distribution Date, from
and including the Closing Date) to and including the 24th day of the calendar
month in which such Distribution Date occurs, on the Class A-4 Notes at the
Class A-4 Rate on the Outstanding Amount of the Class A-4 Notes on the
immediately preceding Distribution Date (or, in the case of the first
Distribution Date, the Closing Date), after giving effect to all distributions
of principal to the Class A-4 Noteholders on or prior to such preceding
Distribution Date. For all purposes of this Agreement and the other Basic
Documents, interest with respect to the Class A-4 Notes shall be computed on
the basis of a 360-day year consisting of twelve 30-day months.
"Class A-4 Noteholder" means the Person in whose name a Class A-4 Note is
registered in the Note Register.
"Class A-4 Notes" means the 6.54% Asset Backed Notes, Class A-4,
substantially in the form of Exhibit A-4 to the Indenture.
"Class A-4 Rate" means 6.54% per annum.
"Closing Date" means September 29, 1999.
"Collateral" has the meaning specified in the Granting Clause of the
Indenture.
"Collection Account" means the account designated as such, established
and maintained pursuant to Section 5.01(a).
"Collection Period" means with respect to any Distribution Date, the
calendar month preceding such Distribution Date. Any amount stated as of the
last day of a Collection Period or as of the first day of a Collection Period
shall give effect to the following calculations as determined as of the close
of business on such last day: (i) all applications of collections and (ii) all
distributions to be made on the following Distribution Date.
"Contract" means a motor vehicle retail installment sale contract.
"Controlling Party" means (i) if the Notes have not been paid in full,
the Indenture Trustee acting at the direction of at least a majority in
Outstanding Amount of the Noteholders and (ii) if the Notes have been paid in
full, the Owner Trustee for the benefit of the Certificateholders.
"Conveyed Assets" shall have the meaning set forth in Section 2.01.
"Corporate Trust Administration Department" shall have the meaning set
forth in the Trust Agreement.
"Corporate Trust Office" shall have the meaning set forth in the
Indenture.
"Custodian" means BMW FS, in its capacity as custodian of the
Receivables.
"Cutoff Date" means the Initial Cutoff Date or the Subsequent Cutoff
Date, as the context may require.
"Dealer" means the dealer who sold a Financed Vehicle and who originated
the related Receivable and assigned it to BMW FS pursuant to a Dealer
Agreement.
"Dealer Agreement" means an agreement between BMW FS and a Dealer
pursuant to which such Dealer sells Contracts to BMW FS, substantially in the
form of Exhibit D hereto.
"Delinquent Receivable" means a Receivable with respect to which more
than 20% of any Scheduled Payment is more than 29 days delinquent as of the
last day of the related Collection Period, excluding Receivables with respect
to which the related Financed Vehicle has been repossessed and Liquidated
Receivables.
"Delivery" when used with respect to Trust Account Property means:
(a) with respect to bankers' acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute "instruments"
within the meaning of Section 9-105(1)(i) of the UCC and are susceptible of
physical delivery, transfer thereof to the Indenture Trustee by physical
delivery to the Indenture Trustee endorsed to, or registered in the name of,
the Indenture Trustee or endorsed in blank, and, with respect to a
certificated security (as defined in Section 8-102 of the UCC) transfer
thereof (i) by delivery of such certificated security endorsed to, or
registered in the name of, the Indenture Trustee or (ii) by delivery thereof
to a "clearing corporation" (as defined in Section 8-102 of the UCC) and the
making by such clearing corporation of appropriate entries on its books
reducing the appropriate securities account of the transferor and increasing
the appropriate securities account of the Indenture Trustee by the amount of
such certificated security and the identification by the clearing corporation
of the certificated securities for the sole and exclusive account of the
Indenture Trustee (all of the foregoing, "Physical Property"), and, in any
event, any such Physical Property in registered form shall be in the name of
the Indenture Trustee or its nominee; and such additional or alternative
procedures as may hereafter become appropriate to effect the complete transfer
of ownership of any such Trust Account Property to the Indenture Trustee or
its nominee or custodian, consistent with changes in applicable law or
regulations or the interpretation thereof;
(b) with respect to any security issued by the U.S. Treasury, the Federal
Home Loan Mortgage Corporation or by the Federal National Mortgage Association
that is a book-entry security held through the Federal Reserve System pursuant
to federal book-entry regulations, the following procedures, all in accordance
with applicable law, including applicable federal regulations and Articles 8
and 9 of the UCC: book-entry registration of such Trust Account Property to an
appropriate book-entry account maintained with a Federal Reserve Bank by a
securities intermediary that is also a "depository" pursuant to applicable
federal regulations; the making by such securities intermediary of entries in
its books and records crediting such Trust Account Property to the Indenture
Trustee's security account at the securities intermediary and identifying such
book-entry security held through the Federal Reserve System pursuant to
federal book-entry regulations as belonging to the Indenture Trustee; and such
additional or alternative procedures as may hereafter become appropriate to
effect complete transfer of ownership of any such Trust Account Property to
the Indenture Trustee, consistent with changes in applicable law or
regulations or the interpretation thereof;
(c) with respect to any item of Trust Account Property that is an
uncertificated security under Article 8 of the UCC and that is not governed by
clause (b) above, registration on the books and records of the issuer thereof
in the name of the Indenture Trustee or its nominee or custodian who either
(i) becomes the registered owner on behalf of the Indenture Trustee or (ii)
having previously become the registered owner, acknowledges that it holds for
the Indenture Trustee; and
(d) with respect to any item of Trust Account Property that is a security
entitlement causing the securities intermediary to indicate on its books and
records that such security entitlement has been credited to a securities
account of the Indenture Trustee.
"Depositor" means SSB and its successors in interest.
"Determination Date" means, with respect to each Distribution Date, the
earlier of (i) the eighteenth calendar day of the month in which such
Distribution Date occurs (or if such eighteenth day is not a Business Day, the
next succeeding Business Day) and (ii) the fifth Business Day preceding such
Distribution Date.
"Distribution Date" means, with respect to each Collection Period, the
twenty-fifth day of the following month or, if such day is not a Business Day,
the immediately following Business Day, commencing on October 25, 1999.
"Distribution Date Payment Shortfall" means, with respect to any
Distribution Date, the amount by which the Required Payment exceeds the Total
Distribution Amount for such Distribution Date.
"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 of America or any State, having corporate trust powers and
acting as trustee for funds deposited in such account, so long as any of the
securities of such depository institution shall have a credit rating from each
Rating Agency in one of its generic rating categories that signifies
investment grade.
"Eligible Institution" means (a) the corporate trust department of the
Indenture Trustee or the Owner Trustee or (b) a depository institution
organized under the laws of the United States of America or any State, that
(i) has either (A) a long-term unsecured debt rating of at least "AA-" by
Standard & Poor's and acceptable to Moody's or (B) a short-term unsecured debt
rating or certificate of deposit rating of at least "A-1+" by Standard &
Poor's and acceptable to Moody's and (ii) the deposits of which are insured by
the FDIC.
"Eligible Investments" means securities, negotiable instruments or
security entitlements that evidence:
(a) direct obligations of, and obligations fully guaranteed as to the
full and timely payment by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit of any
depository institution or trust company incorporated under the laws of the
United States of America or any State (or any domestic branch of a foreign
bank) and subject to supervision and examination by federal or state banking
or depository institution authorities; provided, however, that at the time of
the investment or contractual commitment to invest therein, the commercial
paper or other short-term unsecured debt obligations (other than such
obligations the rating of which is based on the credit of a Person other than
such depository institution or trust company) thereof shall have a credit
rating from each Rating Agency in the highest investment category granted
thereby;
(c) commercial paper having, at the time of the investment or contractual
commitment to invest therein, a rating from each Rating Agency in the highest
investment category granted thereby;
(d) investments in money market funds having a rating from each Rating
Agency in the highest investment category granted thereby (including funds for
which the Indenture Trustee or the Owner Trustee or any of their respective
Affiliates is investment manager or advisor);
(e) bankers' acceptances issued by any depository institution or trust
company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that is a direct
obligation of, or fully guaranteed by, the United States of America or any
agency or instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either case entered
into with a depository institution or trust company (acting as principal)
described in clause; and
(g) any other investment with respect to which the Issuer, the Indenture
Trustee or the Servicer has received written notification from each Rating
Agency that the acquisition of such investment will satisfy the Rating Agency
Condition.
"Eligible Servicer" means BMW FS or any other Person that at the time of
its appointment as Servicer (i) is servicing a portfolio of motor vehicle
retail installment sale contracts or motor vehicle installment loans, (ii) is
legally qualified and has the capacity to service the Receivables, (iii) has
demonstrated the ability professionally and competently to service a portfolio
of motor vehicle retail installment sale contracts or motor vehicle
installment loans similar to the Receivables with reasonable skill and care
and (iv) has a minimum net worth of $50,000,000.
"Excess Mileage" shall mean, with respect to any Financed Vehicle
securing an Owners Choice Receivable, the amounts payable by the related
Obligor relating to the excess of the number of miles by which such Financed
Vehicle has been driven over the number of miles such Financed Vehicle may be
driven during the term of the related Owners Choice Receivable (as specified
in the Contract related to such Owners Choice Receivable) without incurring an
excess mileage charge pursuant to the related Contract, net of the amount, if
any, payable to a third party collection agency as payment of its fees and
expenses in connection with collecting such amounts from the related Obligor.
"Excess Wear and Tear" shall mean, with respect to any Financed Vehicle
securing an Owners Choice Receivable, all amounts payable by the related
Obligor relating to damages to such Financed Vehicle that are not the result
of normal wear and tear, as more specifically described in the Contract
related to such Owners Choice Receivable, net of the amount, if any, payable
to a third party collection agency as payment of its fees and expenses in
connection with collecting such amounts from the related Obligor.
"FDIC" means the Federal Deposit Insurance Corporation, and its
successors.
"Financed Vehicle" means a new or used automobile, sport utility vehicle
or motorcycle, together with all accessions thereto, securing an Obligor's
indebtedness under the related Contract.
"Funding Period" means the period beginning on and including the Closing
Date and ending on and including the first to occur of (a) the Determination
Date on which the amount on deposit in the Pre-Funding Account (after giving
effect to any transfers therefrom in connection with the transfer of
Subsequent Receivables to the Issuer on such Determination Date) is less than
or equal to $100,000, (b) the date of occurrence of a Servicer Termination
Event or an Event of Default under the Indenture, or (c) the last day of the
Collection Period in March 2000.
"Indenture" means the Indenture, dated as of September 1, 1999, between
the Issuer and the Indenture Trustee.
"Indenture Trustee" means the Person acting as Indenture Trustee under
the Indenture, its successors in interest and any successor trustee under the
Indenture.
"Initial Certificate Balance" means $33,400,000.
"Initial Class A-1 Note Balance" means $190,000,000.
"Initial Class A-2 Note Balance" means $400,000,000.
"Initial Class A-3 Note Balance" means $300,000,000.
"Initial Class A-4 Note Balance" means $171,600,000.
"Initial Cutoff Date" means the close of business on August 31, 1999.
"Initial Pool Balance" means an amount equal to the aggregate Principal
Balance of the Initial Receivables as of the Initial Cutoff Date (including
the aggregate principal balance of the Balloon Payments).
"Initial Receivable" means any Contract listed on Schedule A (which
Schedule may be in the form of microfiche).
"Insolvency Event" means, with respect to a specified Person, (a) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property in
an involuntary case under any applicable federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or
ordering the winding-up or liquidation of such Person's affairs, and such
decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or (b) the commencement by such Person of a voluntary case
under any applicable federal or state bankruptcy, insolvency or other similar
law now or hereafter in effect, or the consent by such Person to the entry of
an order for relief in an involuntary case under any such law, or the consent
by such Person to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official for
such Person or for any substantial part of its property, or the making by such
Person of any general assignment for the benefit of creditors, or the failure
by such Person generally to pay its debts as such debts become due, or the
taking of action by such Person in furtherance of any of the foregoing.
"Interest Accrual Period" means, with respect to the Class A-1 Notes, the
period from and including the most recent Distribution Date on which interest
has been paid (or, in the case of the first Distribution Date, the Closing
Date) to and including the day before the Distribution Date and, with respect
to the Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes and the
Certificates, the period from and including the 25th day of the preceding
calendar month (or, in the case of the first Distribution Date, the Closing
Date) to and including the 24th day of the calendar month in which such
Distribution Date occurs.
"Interest Distribution Amount" means, with respect to any Distribution
Date, the sum of the following amounts, without duplication, with respect to
the Receivables in respect of the Collection Period preceding such
Distribution Date: (a) that portion of all collections on Receivables
allocable to interest (including any Advances in respect thereof), (b) the
Purchase Amount of each Receivable that became a Purchased Receivable during
such Collection Period to the extent attributable to accrued interest on such
Receivable, (c) Recoveries for such Collection Period, (d) Investment Earnings
for the related Distribution Date, (e) Liquidation Proceeds for such
Collection Period to the extent allocable to interest, (f) Net Investment
Losses required to be deposited by the Servicer and (g) the Capitalized
Interest Distribution Amount; provided, however, that in calculating the
Interest Distribution Amount the following will be excluded: all payments and
proceeds (including Liquidation Proceeds) of any Purchased Receivables the
Purchase Amount of which has been included in the Interest Distribution Amount
in a prior Collection Period.
"Investment Earnings" means, with respect to any Distribution Date, the
investment earnings (net of losses and investment expenses) on amounts on
deposit in a Trust Account (other than the Collection Account) to be applied
on such Distribution Date pursuant to Section 5.01(d).
"Issuer" means BMW Vehicle Owner Trust 1999-A.
"Lien" means a security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than tax liens, mechanics' liens and any liens
that attach to the respective Receivable by operation of law as a result of
any act or omission by the related Obligor.
"Liquidated Receivable" means a Receivable with respect to which the
earliest of the following shall have occurred: (i) the related Financed
Vehicle has been repossessed and liquidated, (ii) the related Financed Vehicle
has been repossessed in excess of 90 days and has not yet been liquidated,
(iii) in the case of an Owners Choice Receivable for which the Obligor has
exercised the Sale Option the related Financed Vehicle has been liquidated,
(iv) the Servicer has determined in accordance with its credit policies that
all amounts that it expects to receive with respect to the Receivable have
been received or (v) the end of the Collection Period in which the Receivable
becomes 150 days or more past due. For purposes of this definition and an
Owners Choice Receivable for which the Sale Option has been exercised, such
Receivable will be considered a Liquidated Receivable on the earlier to occur
of (a) the disposition of the related Financed Vehicles and (b) 90 days from
the date the Sale Option was exercised.
"Liquidation Proceeds" means, with respect to any Receivable that becomes
a Liquidated Receivable, the moneys collected in respect thereof, from
whatever source, during or after the Collection Period in which such
Receivable became a Liquidated Receivable, including liquidation of the
related Financed Vehicle, net of the sum of any out-of-pocket expenses of the
Servicer reasonably allocated to such liquidation and any amounts required by
law to be remitted to the Obligor on such Liquidated Receivable.
"Minimum Required Rating" means, with respect to BMW Capital, a
short-term unsecured debt rating of the commercial paper of BMW Capital (which
commercial paper is guaranteed by Bayerische Motoren Werke Aktiengesellschaff)
equal to or greater than "Prime-1" by Moody's and "A-1" by Standard & Poor's.
"Moody's" means Moody's Investors Service, Inc., and its successors.
"Net Investment Losses" means, with respect to a Trust Account and any
Collection Period, the amount, if any, by which the aggregate of all losses
and expenses incurred during such period in connection with the investment of
funds in Eligible Investments in accordance with Section 5.01(d) exceeds the
aggregate of all interest and other income realized during such period on such
funds.
"Nonrecoverable Advance" means any advance made or proposed to be made
pursuant to Section 5.12, which the Servicer believes, in its good faith
judgment, is not, or if made would not be, ultimately recoverable from
Liquidation Proceeds or otherwise. In determining whether an advance is or
will be nonrecoverable, the Servicer need not take into account that it might
receive any amounts in a deficiency judgment.
"Note Balance" means, as of any date of determination, an amount equal to
the sum of (i) the Initial Class A-1 Note Balance, (ii) the Initial Class A-2
Note Balance, (iii) the Initial Class A-3 Note Balance and (iv) the Initial
Class A-4 Note Balance, less all amounts distributed to Noteholders on or
prior to such date and allocable to principal.
"Note Distribution Account" means the account designated as such,
established and maintained pursuant to Section 5.01(b).
"Note Pool Factor" means, with respect to each Class of Notes as of the
close of business on the last day of a Collection Period, a seven-digit
decimal figure equal to the Outstanding Amount of such Class of Notes (after
giving effect to any reductions thereof to be made on the immediately
following Distribution Date) divided by the original Outstanding Amount of
such Class of Notes. The Note Pool Factor will be 1.0000000 as of the Closing
Date; thereafter, the Note Pool Factor will decline to reflect reductions in
the Outstanding Amount of such Class of Notes.
"Noteholders" shall mean the Class A-1 Noteholders, the Class A-2
Noteholders, the Class A-3 Noteholders or the Class A-4 Noteholders.
"Noteholders' Distributable Amount" means, with respect to any
Distribution Date, the sum of the Noteholders' Interest Distributable Amount
and the Noteholders' Principal Distributable Amount.
"Noteholders' Interest Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class A-1 Interest Distributable Amount for
such Distribution Date, the Class A-2 Interest Distributable Amount for such
Distribution Date, the Class A-3 Interest Distributable Amount for such
Distribution Date and the Class A-4 Interest Distributable Amount for such
Distribution Date.
"Noteholders' Principal Distributable Amount" means, with respect to any
Distribution Date, the greater of (1) the lesser of (a) the Regular Principal
Distributable Amount on such Distribution Date and (b) the Class A-1 Note
Balance immediately prior to that Distribution Date and (2) the excess, if
any, of (x) the aggregate Outstanding Amount of all Securities as of the day
immediately preceding such Distribution Date over (y) the sum of the Pool
Balance at the end of the related Collection Period and the amount, if any, on
deposit in the Pre-Funding Account less the Yield Supplement
Overcollateralization Amount with respect to such Distribution Date; provided,
however, that the Noteholders' Principal Distributable Amount shall not exceed
the Outstanding Amount of the Notes; and, provided, further, that:
(1) the Noteholders' Principal Distributable Amount on the Class A-1
Final Scheduled Distribution Date shall not be less that the amount
that is necessary to reduce the Outstanding Amount of the Class A-1
Notes to zero;
(2) the Noteholders' Principal Distributable Amount on the Class A-2
Final Scheduled Distribution Date shall not be less that the amount
that is necessary to reduce the Outstanding Amount of the Class A-2
Notes to zero;
(3) the Noteholders' Principal Distributable Amount on the Class A-3
Final Scheduled Distribution Date shall not be less that the amount
that is necessary to reduce the Outstanding Amount of the Class A-3
Notes to zero;
(4) the Noteholders' Principal Distributable Amount on the Class A-4
Final Scheduled Distribution Date shall not be less that the amount
that is necessary to reduce the Outstanding Amount of the Class A-4
Notes to zero.
"Obligor" on a Receivable means the purchaser or co-purchasers of the
related Financed Vehicle, and any other Person obligated to make payments
thereunder.
"Officers' Certificate" means a certificate signed by (a) the chairman of
the board, any vice president, the controller or any assistant controller and
(b) the president, a treasurer, assistant treasurer, secretary or assistant
secretary of the Depositor or the Servicer, as appropriate.
"Opinion of Counsel" means one or more written opinions of counsel, who
may be an employee of or counsel to the Depositor or the Servicer, which
counsel shall be acceptable to the Indenture Trustee, the Owner Trustee or the
Rating Agencies, as applicable, and which shall be addressed to the Owner
Trustee and the Indenture Trustee and which shall be at the expense of the
person required to provide such an Opinion of Counsel.
"Outstanding Amount" means, as of any date of determination, the
aggregate principal amount of a Class of Notes outstanding as of such date of
determination.
"Outstanding Amount Advanced" means, as to any Distribution Date, the
aggregate of all Advances remitted by the Servicer out of its own funds
pursuant to Section 5.12, less the aggregate of all related Advance
Reimbursement Amounts actually received prior to such Distribution Date.
"Owner Trustee" means Wilmington Trust Company, acting not in its
individual capacity but solely as owner trustee under the Trust Agreement.
"Owners Choice Receivable" means any Receivable that was originated under
BMW FS' balloon payment financing program which provides Obligors with an end
of term option to purchase, refinance or return Financed Vehicles.
"Pass-Through Rate" means 6.91% per annum.
"Physical Property" has the meaning assigned to such term in the
definition of "Delivery" above.
"Pool Balance" means, with respect to any Distribution Date, an amount
equal to the aggregate Principal Balance of the Receivables (including the
aggregate Principal Balance of the Balloon Payments) at the end of the related
Collection Period, after giving effect to all payments of principal received
from Obligors and Purchase Amounts to be remitted by the Servicer for the
related Collection Period, and after reduction to zero of the aggregate
outstanding Principal Balance of all Receivables that became Liquidated
Receivables during such Collection Period.
"Pre-Funded Amount" means the amount on deposit in the Pre-Funding
Account, which shall initially be $112,777,957.15.
"Pre-Funded Percentage" means, with respect to a Class of Notes, the
ratio (expressed as a percentage), the numerator of which is the Outstanding
Amount of such Class of Notes as of the preceding Distribution Date and the
denominator of which is the Note Balance as of the preceding Distribution
Date.
"Pre-Funding Account" means the account designated as such, established
and maintained pursuant to Section 5.01(c)(ii).
"Principal Balance" means, with respect to any Receivable and a
Determination Date, the Amount Financed minus an amount equal to, as of the
close of business on the last day of the related Collection Period, that
portion of all amounts received on or prior to such day with respect to such
Receivable and allocable to principal using the Simple Interest Method.
"Purchase Amount" means, with respect to any Receivable that became a
Purchased Receivable, the unpaid principal balance owed by the Obligor thereon
plus unpaid interest on such amount at the applicable APR to the last day of
the month of repurchase.
"Purchased Receivable" means a Receivable purchased as of the close of
business on the last day of a Collection Period by or on behalf of the
Servicer pursuant to Section 4.07 or by or on behalf of the Seller pursuant to
Section 3.03 and the Receivables Purchase Agreement.
"Rating Agency" means Moody's or Standard & Poor's, as the context may
require. If none of Moody's, Standard & Poor's or a successor thereto remains
in existence, "Rating Agency" shall mean any nationally recognized statistical
rating organization or other comparable Person designated by the Depositor.
"Rating Agency Condition" means, with respect to any action, that each
Rating Agency shall have been given 10 days' (or such shorter period as shall
be acceptable to each Rating Agency) prior notice thereof and that each Rating
Agency shall not have notified the Issuer or the Indenture Trustee in writing
that such action will result in a reduction, withdrawal or down-grade of the
then-current rating of each class of Notes.
"Realized Losses" means, with respect to any Receivable that becomes a
Liquidated Receivable, the excess of the Principal Balance thereof (including
the principal amount of any Balloon Payment) over the portion of related
Liquidation Proceeds allocable to principal.
"Receivable Files" means the following documents with respect to each
Financed Vehicle:
(i) the fully executed original of each Receivable (together with
any agreements modifying each such Receivable, including any deferment
agreement);
(ii) the original credit application, or an electronic copy thereof;
(iii) the original certificate of title or such other documents that
the Servicer or the Seller shall keep on file in accordance with its
customary procedures evidencing the security interest of the Seller in
the related Financed Vehicle; and
(iv) any and all other documents that the Servicer shall have kept
on file in accordance with its customary procedures relating to a
Receivable, an Obligor or a Financed Vehicle.
"Receivables" means the Initial Receivables and the Subsequent
Receivables.
"Receivables Purchase Agreement" means the Receivables Purchase Agreement
dated as of September 1, 1999, among BMW FS Funding Corporation, as a seller,
BMW FS, as a seller, and SSB, as Depositor.
"Record Date" means, as to any Distribution Date, the day immediately
preceding such Distribution Date.
"Recoveries" means, with respect to any Receivable that becomes a
Liquidated Receivable, monies collected in respect thereof, from whatever
source, during any Collection Period following the Collection Period in which
such Receivable became a Liquidated Receivable, net of the sum of any amounts
expended by the Servicer for the account of the Obligor and any amounts
required by law to be remitted to the Obligor.
"Regular Principal Distributable Amount" means, with respect to any
Distribution Date, the sum of the following amounts, without duplication, with
respect to the Receivables in respect of the related Collection Period: (i)
that portion of all collections on the Receivables allocable to principal
(including with respect to any Owners Choice Receivable, the amount owed by
the related Obligor with respect to a Balloon Payment), (ii) the aggregate
outstanding principal balance of all Receivables that became Liquidated
Receivables during such Collection Period, (iii) that portion allocable to
principal of the Purchase Amount of all Receivables that became Purchased
Receivables during or in respect of such Collection Period, (iv) on the
Distribution Date on or immediately following the end of the Funding Period,
the Remaining Pre-Funded Amount.
"Remaining Pre-Funded Amount" means the Pre-Funded Amount on deposit in
the Pre-Funding Account at the end of the Funding Period after the application
thereof to the purchase of any Subsequent Receivables.
"Required Payment" means, with respect to each Distribution Date, the
amount required to be distributed to the Securityholders pursuant to Section
5.06(b)(i), (ii), (iii), (iv) and (v).
"Reserve Account" means the account designated as such, established by
the Issuer and maintained by the Indenture Trustee pursuant to Section
5.01(c)(i).
"Reserve Account Initial Deposit" means $37,514,710.
"Reserve Account Required Amount" means (a) on the Closing Date, the
Reserve Account Initial Deposit and (b) with respect to any Distribution Date,
an amount equal to 5.0% of the sum of the Pool Balance and the amount, if any,
on deposit in the Pre-Funding Account as of the end of the related Collection
Period; provided, however, that in no event shall the Reserve Account Required
Amount be less than the lesser of (a) $11,131,702 and (b) the aggregate
principal amount of the Securities on such Distribution Date (after giving
effect to distributions on such date).
"Reserve Account Withdrawal Amount" means, with respect to each
Distribution Date, the lesser of the Distribution Date Payment Shortfall and
the amount on deposit in the Reserve Account for such Distribution Date.
"Responsible Officer" means the chairman of the board, the president, any
executive vice president, any vice president, the treasurer, any assistant
treasurer, the secretary, or any assistant secretary of the Servicer.
Responsible Officer of the Owner Trustee shall be as defined in the Indenture.
"Scheduled Payment" means, with respect to each Receivable, the scheduled
monthly payment amount set forth in the related Contract and required to be
paid by the Obligor during each Collection Period.
"Securities" means the Notes and the Certificates.
"Securities Intermediary" means The Chase Manhattan Bank, in its capacity
as the securities intermediary in the Securities Account Control Agreement
dated as of September 29, 1999.
"Securityholders" means the Noteholders and/or the Certificateholders, as
the context may require.
"Sellers" means BMW FS and BMW FS Funding Corporation and their
respective successors in interest, as sellers of the Receivables to the
Depositor pursuant to the Receivables Purchase Agreement.
"Servicer" means BMW FS, as the servicer of the Receivables, and each
successor to BMW FS (in the same capacity) pursuant to Section 7.03 or 8.03.
"Servicer Termination Event" shall have the meaning set forth in Section
8.01.
"Servicer's Certificate" means an Officers' Certificate of the Servicer
delivered pursuant to Section 4.09, substantially in the form of Exhibit C.
"Servicing Fee" means an amount equal to the sum of (i) the product of
the Servicing Fee Rate and the Pool Balance as of the first day of the related
Collection Period, and (ii) any late fees, prepayment charges, extension fees
and other administrative fees or similar charges collected on the Receivables.
"Servicing Fee Rate" means 1.00% per annum.
"Simple Interest Method" means the method of allocating the monthly
payments received with respect to a Receivable to interest in an amount equal
to the product of (i) the applicable APR, (ii) the period of time (expressed
as a fraction of a year, based on the actual number of days in the calendar
month and 365 days in the calendar year) elapsed since the preceding payment
was made under such Receivable and (iii) the outstanding principal amount of
such Receivable, and allocating the remainder of each such monthly payment to
principal.
"SSB" means SSB Vehicle Securities Inc., a Delaware corporation, and its
successors.
"Standard & Poor's" means Standard & Poor's Ratings Group, a division of
The McGraw-Hill Companies, Inc., and its successors.
"Subsequent Closing Date" shall have the meaning assigned to such term in
the Subsequent Purchase Agreement.
"Subsequent Cutoff Date" means the date as of which Subsequent
Receivables are conveyed to the Trust pursuant to Section 2.01.
"Subsequent Purchase Agreement" shall have the meaning assigned to such
term in the Receivables Purchase Agreement.
"Subsequent Receivables" means the Contracts transferred to the Issuer
pursuant to Section 2.01, which shall be listed on Schedule A to the
Subsequent Transfer Agreement.
"Subsequent Transfer Agreement" shall have the meaning assigned hereto in
Section 2.01(b).
"Subsequent Transfer Date" means the date designated by the Depositor
during the Funding Period on which Subsequent Receivables are to be
transferred to the Issuer in accordance with Section 2.01 and pursuant to the
Subsequent Transfer Agreement.
"Total Distribution Amount" means, for each Distribution Date, the sum of
the related Interest Distribution Amount and the related Regular Principal
Distributable Amount (other than the portion thereof attributable to Realized
Losses).
"Trust" means the Issuer.
"Trust Account Property" means the Trust Accounts, all amounts and
investments held from time to time in any Trust Account (whether in the form
of deposit accounts, Physical Property, book-entry securities, uncertificated
securities or otherwise) and all proceeds of the foregoing.
"Trust Accounts" shall mean the Collection Account, the Note Distribution
Account, the Capitalized Interest Account, the Pre-Funding Account and the
Reserve Account.
"Trust Agreement" means the Amended and Restated Trust Agreement, dated
as of September 1, 1999, between the Depositor and the Owner Trustee.
"Trustee Fee Rates" means the rates at which the fees and expenses are
due to the Indenture Trustee and the Owner Trustee.
"Trust Officer" means, in the case of the Indenture Trustee, any Officer
within the Global Trust Service Department of the Indenture Trustee, including
any Assistant Vice President, Assistant Treasurer, Assistant Secretary or any
other officer of the Indenture Trustee customarily performing functions
similar to those performed by any of the above designated officers and also,
with respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject, in each case having direct responsibility for the
administration of the Basic Documents and, with respect to the Owner Trustee,
any officer in the Corporate Trust Administration Department of the Owner
Trustee with direct responsibility for the administration of the Trust
Agreement and the other Basic Documents on behalf of the Owner Trustee.
"UCC" means the Uniform Commercial Code, as in effect in the relevant
jurisdiction.
"Weighted Average Security Rate" means the percentage equivalent of a
fraction, the numerator of which is the sum of (1) the product of the Class
A-1 Rate times the Initial Class A-1 Note Balance, (2) the Product of the
Class A-2 Rate times the Initial Class A-2 Note Balance, (3) the product of
the Class A-3 Rate times the Initial Class A-3 Note Balance, (4) the product
of the Class A-4 Rate times the Initial Class A-4 Note Balance and (5) the
product of the Pass-Through Rate and the Initial Certificate Balance and the
denominator of which is the sum of the Initial Class A-1 Note Balance, the
Initial Class A-2 Note Balance, the Initial Class A-3 Note Balance, the
Initial Class A-4 Note Balance and the Initial Certificate Balance.
"Yield Supplement Overcollateralization Amount" means, with respect to
any Distribution Date, the dollar amount set forth next to such Distribution
Date on Schedule D hereto.
Section 1.02. Other Definitional Provisions.
(a) Capitalized terms used herein that are not otherwise defined shall
have the meanings ascribed thereto in the Indenture or, if not defined
therein, in the Trust Agreement.
(b) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant
hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given
to them under generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Agreement or in any such certificate
or other document are inconsistent with the meanings of such terms under
generally accepted accounting principles, the definitions contained in this
Agreement or in any such certificate or other document shall control.
(d) The words "hereof," "herein," "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not
to any particular provision of this Agreement; Article, Section, Schedule and
Exhibit references contained in this Agreement are references to Articles,
Sections, Schedules and Exhibits in or to this Agreement unless otherwise
specified; "or" shall include "and/or"; and the term "including" shall mean
"including without limitation".
(e) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such terms.
(f) Any agreement, instrument or statute defined or referred to herein or
in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and assigns.
<PAGE>
ARTICLE II
CONVEYANCE OF RECEIVABLES
Section 2.01. Conveyance of Receivables.
(a) In consideration of the Issuer's delivery to or upon the order of the
Depositor of the Notes, the Certificates and the Residual Interest (as defined
in the Trust Agreement), the Depositor does hereby sell, transfer, assign, set
over and otherwise convey to the Issuer, without recourse (subject to the
obligations of the Depositor set forth herein), all right, title and interest
of the Depositor in and to:
(i) the Initial Receivables and all moneys received thereon after
the Initial Cutoff Date and the Subsequent Receivables listed on Schedule
A to the Subsequent Transfer Agreement and all moneys received therefrom
on or after the Subsequent Cutoff Date;
(ii) the security interests in the Financed Vehicles and any
accessions thereto granted by Obligors pursuant to the Receivables and
any other interest of the Depositor in such Financed Vehicles;
(iii) any Liquidation Proceeds and any other proceeds with respect
to the Receivables from claims on any physical damage, credit life or
disability insurance policies covering the Financed Vehicles or the
related Obligors, including any vendor's single interest or other
collateral protection insurance policy;
(iv) any property that shall have secured a Receivable and shall
have been acquired by or on behalf of the Depositor, the Servicer or the
Trust;
(v) all documents and other items contained in the Receivable Files;
(vi) all of the Depositor's rights (but not its obligations) under
the Receivables Purchase Agreement and the Subsequent Purchase Agreement;
(vii) all right, title and interest in all funds on deposit from
time to time in the Trust Accounts and the Certificate Distribution
Account and in all investments therein and proceeds thereof (including
all Investment Earnings thereon); and
(viii) the proceeds of any and all of the foregoing (collectively,
with the assets listed in clauses (i) through (vii) above, the "Conveyed
Assets").
It is the intention of the Depositor that the transfer and assignment
contemplated by this Agreement shall constitute a sale of the Receivables and
other related property from the Depositor to the Trust and the beneficial
interest in and title to the Receivables and the related property shall not be
part of the Depositor's estate in the event of the filing of a bankruptcy
petition by or against the Depositor under any bankruptcy law. In the event
that, notwithstanding the intent of the Depositor, the transfer and assignment
contemplated hereby is held not to be a sale, this Agreement shall constitute
a grant of a security interest in all accounts, money, chattel paper,
securities, instruments, documents, deposit accounts, certificates of deposit,
letters of credit, advices of credit, banker's acceptances, uncertificated
securities, general intangibles, contract rights, goods and other property
consisting of, arising from or relating to such Conveyed Assets, for the
benefit of the Securityholders as security for the Depositor's obligations
hereunder.
(b) The Depositor shall transfer to the Issuer the Subsequent Receivables
and the other property and rights related thereto described in paragraph (a)
above only upon the satisfaction of each of the following conditions and
satisfaction by the Seller of the conditions in Section 2.03 of the
Receivables Purchase Agreement on or prior to the Subsequent Transfer Date:
(i) the Depositor shall have delivered to the Owner Trustee and the
Indenture Trustee (A) a written transfer agreement in substantially the
form of Exhibit E hereto, which shall have been duly executed by each of
the parties thereto (the "Subsequent Transfer Agreement"), which shall
include supplements to Schedule A hereto listing the Subsequent
Receivables and (B) an Addition Notice;
(ii) on the Subsequent Transfer Date, (A) the Depositor was not
insolvent and will not become insolvent as a result of the transfer of
the related Subsequent Receivables on the Subsequent Transfer Date, (B)
the Depositor did not intend to incur or believe that it would incur
debts that would be beyond the Depositor's ability to pay as such debts
matured, (C) such transfer was not made with actual intent to hinder,
delay or defraud any Person and (D) the assets of the Depositor did not
constitute unreasonably small capital to carry out its business as
conducted;
(iii) the Funding Period shall not have terminated;
(iv) each of the representations and warranties made by the
Depositor pursuant to Section 3.02 with respect to the related Subsequent
Receivables shall be true and correct as of the Subsequent Transfer Date;
(v) the addition of any of the related Subsequent Receivables will
not result in a material adverse tax consequence to the Trust, the
Noteholders or the Certificateholders;
(vi) the Depositor shall have delivered to each Rating Agency, the
Issuer and the Indenture Trustee, an Opinion of Counsel with respect to
the transfer of the related Subsequent Receivables substantially in the
form of, or confirming, the Opinion of Counsel delivered to each Rating
Agency on the Closing Date and any other opinions reasonably required by
the Rating Agencies;
(vii) the Rating Agency Condition shall be satisfied with respect to
the transfer of the Subsequent Receivables to the Trust; and
(viii) the Depositor shall have delivered to the Indenture Trustee
and the Owner Trustee an Officers' Certificate confirming the
satisfaction of each condition precedent on its part to be performed
specified in this paragraph.
(c) The Depositor covenants to transfer to the Issuer during the Funding
Period pursuant to, and subject to the conditions set forth in, paragraph (b)
above, all Subsequent Receivables transferred by BMW FS to the Depositor
pursuant to Section 2.03 of the Receivables Purchase Agreement.
<PAGE>
ARTICLE III
THE RECEIVABLES
Section 3.01. Representations and Warranties of the Sellers.
(a) The Sellers have made each of the representations and warranties set
forth in Exhibit A hereto under the Receivables Purchase Agreement and have
consented to the assignment by the Depositor to the Issuer of the Depositor's
rights with respect thereto. Such representations and warranties speak as of
the execution and delivery of this Agreement and as of the Closing Date in the
case of the Initial Receivables and as of the Subsequent Transfer Date in the
case of the Subsequent Receivables, but shall survive the sale, transfer and
assignment of the Receivables to the Issuer and the pledge of such Receivables
to the Indenture Trustee. Pursuant to Section 2.01 of this Agreement, the
Depositor has sold, assigned, transferred and conveyed to the Issuer, as part
of the assets of the Issuer, its rights under the Receivables Purchase
Agreement, including the representations and warranties of the Sellers therein
as set forth in Exhibit A, upon which representations and warranties the
Issuer relies in accepting the Receivables and delivering the Securities,
together with all rights of the Depositor with respect to any breach thereof,
including the right to require the Sellers to repurchase Receivables in
accordance with the Receivables Purchase Agreement. It is understood and
agreed that the representations and warranties referred to in this Section
shall survive the sale and delivery of the Receivables to the Issuer or the
Custodian.
(b) The Sellers hereby agree that the Issuer shall have the right to
enforce any and all rights under the Receivables Purchase Agreement assigned
to the Issuer herein, including the right to cause the Sellers to repurchase
any Receivable with respect to which it is in breach of any of its
representations and warranties set forth in Exhibit A, directly against the
Sellers as though the Issuer were a party to the Receivables Purchase
Agreement, and the Issuer shall not be obligated to exercise any such rights
indirectly through the Depositor.
Section 3.02. Representations and Warranties of the Depositor. The
Depositor makes the following representations and warranties, on which the
Issuer relies in accepting the Receivables and delivering the Securities. Such
representations and warranties speak as of the execution and delivery of this
Agreement and as of the Closing Date in the case of the Initial Receivables
and as of the Subsequent Transfer Date in the case of the Subsequent
Receivables, but shall survive the sale, transfer and assignment of the
Receivables by the Depositor to the Issuer and the pledge thereof to the
Indenture Trustee pursuant to the Indenture:
(a) Title. The Depositor shall convey to the Issuer all right, title and
interest of the Depositor in and to the Receivables.
(b) All Filings Made. The Depositor has caused all filings (including UCC
filings) to be made in New York and Delaware with respect to the sale of the
Receivables to the Issuer and the pledge contemplated in the Basic Agreements
to the Indenture Trustee.
(c) Liens. The Depositor has not taken any actions to create, incur or
suffer to exist any Lien on or restriction on transferability of any
Receivable except for the Lien of the Indenture and the restrictions on
transferability imposed by this Agreement.
Section 3.03. Repurchase Upon Breach. Each of the Depositor, the Owner
Trustee, the Indenture Trustee, the Sellers and the Servicer shall inform the
other parties to this Agreement promptly, in writing, upon the discovery by it
of any breach of the Sellers' representations and warranties made pursuant to
Section 3.01 of this Agreement or Section 3.02 of the Receivables Purchase
Agreement, without regard to any limitation set forth in such representation
or warranty concerning the knowledge of the Sellers as to the facts stated
therein. Unless any such breach shall have been cured by the last day of the
first Collection Period following the discovery or notice thereof, the Sellers
shall be obligated and, if necessary, the Issuer shall enforce the obligations
of the Sellers under the Receivables Purchase Agreement, to purchase as of
such last day any Receivable materially and adversely affected by any such
breach. In consideration of the repurchase of any such Receivable, the
repurchasing Sellers shall remit the Purchase Amount to the Collection Account
and notify in writing the Indenture Trustee of such deposit, in the manner
specified in Section 5.04. The sole remedy of the Issuer, the Indenture
Trustee, the Noteholders, or the Certificateholders with respect to the unpaid
balance plus accrued interest on any Receivable as to which a breach of a
representation or warranty has occurred pursuant to Section 3.01 of this
Agreement or Section 3.02 of the Receivables Purchase Agreement or the
agreement contained in this Section shall be to require the Sellers to
purchase such Receivable pursuant to this Section or to repurchase such
Receivable pursuant to the Receivables Purchase Agreement.
Section 3.04. Custody of Receivable Files. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Issuer
hereby revocably appoints the Servicer, and the Servicer hereby accepts such
appointment, to act for the benefit of the Issuer and the Indenture Trustee as
custodian of the Receivable Files, which are hereby constructively delivered
by the Issuer to the Indenture Trustee.
Section 3.05. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer shall hold the Receivable Files as
custodian for the benefit of the Issuer and the Indenture Trustee, and shall
maintain such accurate and complete accounts, records and computer systems
pertaining to each Receivable File as shall enable the Issuer to comply with
this Agreement. In performing its duties as custodian, the Servicer shall act
with reasonable care, using that degree of skill and attention that the
Servicer exercises with respect to the receivable files relating to all
comparable automotive and motorcycle receivables that the Servicer services
for itself or others. The Servicer shall conduct, or cause to be conducted,
periodic reviews of the Receivable Files held by it under this Agreement in a
manner consistent with its reviews of other receivables serviced for its own
account and of the related accounts, records and computer systems, in such a
manner as shall enable the Issuer or the Indenture Trustee to verify the
accuracy of the Servicer's record keeping. The Servicer shall promptly report
to the Issuer and the Indenture Trustee any material failure on its part to
hold the Receivable Files and maintain its accounts, records and computer
systems as herein provided and shall promptly take appropriate action to
remedy any such material failure. Nothing herein shall be deemed to require an
initial review or any periodic review by the Issuer or the Indenture Trustee
of the Receivable Files.
(b) Maintenance of and Access to Records. The Servicer shall maintain
each Receivable File at one of its offices specified in Schedule B to this
Agreement or at such other office as shall be specified to the Issuer and the
Indenture Trustee by written notice not later than 90 days after any change in
location. The Servicer shall make available to the Issuer and the Indenture
Trustee or their duly authorized representatives, attorneys or auditors a list
of locations of the Receivable Files and the related accounts, records and
computer systems maintained by the Servicer at such times during normal
business hours as the Issuer shall reasonably instruct, which does not
unreasonably interfere with the Servicer's normal operations or customer or
employee relations.
Section 3.06. Instructions; Authority to Act. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable
Files upon its receipt of written instructions signed by a Trust Officer of
the Indenture Trustee or, if the Notes have been paid in full, of the Owner
Trustee.
Section 3.07. Custodian's Indemnification. The Servicer, as custodian,
shall indemnify the Trust, the Owner Trustee and the Indenture Trustee and
each of their officers, directors, employees and agents for any and all
liabilities, obligations, losses, compensatory damages, payments, costs, or
expenses of any kind whatsoever that may be imposed on, incurred by or
asserted against the Trust, the Owner Trustee or the Indenture Trustee or any
of their officers, directors, employees or agents as the result of any
improper act or omission in any way relating to the maintenance and custody by
the Servicer as custodian of the Receivable Files; provided, however, that the
Servicer shall not be liable to the Owner Trustee, the Indenture Trustee or
any such officer, director, employee or agent of the Owner Trustee or the
Indenture Trustee for any portion of any such amount resulting from the
willful misfeasance, bad faith or negligence of the Owner Trustee or the
Indenture Trustee, as the case may be, or any such officer, director, employee
or agent of the Owner Trustee or the Indenture Trustee, as the case may be.
Indemnification under this Section shall survive the resignation or
removal of the Servicer or the termination of this Agreement with respect to
acts or omissions of such Servicer preceding such resignation or removal and
shall include reasonable fees and expenses of counsel and expenses of
litigation, each of which is duly documented. If the Servicer shall have made
any indemnity payments pursuant to this Section and the Person to or on behalf
of whom such payments are made thereafter collects any of such amounts from
others, such Person shall promptly repay such amounts to the Servicer, without
interest.
Section 3.08. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Initial Cutoff Date
and shall continue in full force and effect unless and until terminated
pursuant to this Section 3.08. If BMW FS or any successor Servicer shall
resign as Servicer in accordance with the provisions of this Agreement or if
all of the rights and obligations of BMW FS or any successor Servicer shall
have been terminated under Section 8.02, the appointment of such Servicer as
custodian may be terminated by the Issuer or by the Holders of Notes
evidencing not less than 50% of the Outstanding Amount of the Notes, by the
Owner Trustee or by Holders (other than the Seller or an affiliate thereof) of
Certificates evidencing not less than 50% of the Certificate Balance, in the
same manner as the Indenture Trustee or such Securityholders may terminate the
rights and obligations of the Servicer under Section 8.02. As soon as
practicable after any termination of such appointment (but in no event more
than ten (10) Business Days after any such termination of appointment), the
Servicer shall deliver the Receivable Files to the Indenture Trustee or the
Indenture Trustee's agent at such place or places as the Indenture Trustee may
reasonably designate. Notwithstanding the termination of BMW FS as custodian,
the Indenture Trustee and the Owner Trustee agree that, upon any such
termination and for so long as BMW FS remains the Servicer hereunder, the
Indenture Trustee or the Owner Trustee, as the case may be, shall provide, or
cause its agent to provide, access to the Receivable Files to the Servicer for
the purpose of enabling the Servicer to perform its obligations under this
Agreement with respect to the servicing of the Receivables.
<PAGE>
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
Section 4.01. Duties of Servicer. The Servicer, for the benefit of the
Issuer and the Indenture Trustee, shall manage, service, administer and make
collections on the Receivables and perform the other actions required by the
Servicer under this Agreement. The Servicer shall service the Receivables in
accordance with its customary and usual procedures. The Servicer's duties
shall include the collection and posting of all payments, responding to
inquiries of Obligors, investigating delinquencies, sending payment coupons to
Obligors, reporting any required tax information to Obligors, monitoring the
Collateral, accounting for collections, furnishing monthly and annual
statements to the Owner Trustee, and the Indenture Trustee with respect to
distributions and performing the other duties specified herein. The Servicer
also shall administer and enforce all rights of the holder of the Receivables
under the Receivables and the Dealer Agreements. To the extent consistent with
the standards, policies and procedures otherwise required hereby, the Servicer
shall follow its customary standards, policies and procedures and shall have
full power and authority, acting alone, to do any and all things in connection
with the managing, servicing, administration and collection of the Receivables
that it may deem necessary or desirable. Without limiting the generality of
the foregoing, the Servicer is hereby authorized and empowered to execute and
deliver, on behalf of itself, the Issuer, the Owner Trustee, the Indenture
Trustee, the Certificateholders and the Noteholders, or any of them, any and
all instruments of satisfaction or cancellation, or of partial or full release
or discharge, and all other comparable instruments with respect to the
Receivables and with respect to the Financed Vehicles; provided, however,
that, notwithstanding the foregoing, the Servicer shall not, except pursuant
to an order from a court of competent jurisdiction, release an Obligor from
payment of any unpaid amount due under any Receivable, reduce the related APR
or waive the right to collect the unpaid balance of any Receivable from an
Obligor. The Servicer is hereby authorized to commence, in its own name or in
the name of the Issuer, the Indenture Trustee, the Owner Trustee, the
Certificateholders or the Noteholders, a legal proceeding to enforce a
Receivable pursuant to Section 4.03 or to commence or participate in any other
legal proceeding (including a bankruptcy proceeding) relating to or involving
a Receivable, an Obligor or a Financed Vehicle or self help as permitted by
applicable law. If the Servicer commences or participates in any such legal
proceeding in its own name, the Indenture Trustee or the Issuer shall
thereupon be deemed to have automatically assigned the applicable Receivable
to the Servicer solely for purposes of commencing or participating in such
proceeding as a party or claimant, and the Servicer is authorized and
empowered by the Indenture Trustee or the Issuer to execute and deliver in the
Indenture Trustee's or the Issuer's name any notices, demands, claims,
complaints, responses, affidavits or other documents or instruments in
connection with any such proceeding. If in any enforcement suit or legal
proceeding it shall be held that the Servicer may not enforce a Receivable on
the ground that it shall not be a real party in interest or a holder entitled
to enforce such Receivable, the Owner Trustee shall, at the Servicer's expense
and direction, take steps to enforce such Receivable, including bringing suit
in its name or the name of the Issuer, the Indenture Trustee, the
Certificateholders or the Noteholders. The Owner Trustee and the Indenture
Trustee shall upon the written request of the Servicer furnish the Servicer
with any powers of attorney and other documents reasonably necessary or
appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
Section 4.02. Collection of Receivable Payments; Modifications of
Receivables.
(a) Consistent with the standards, policies and procedures required by
this Agreement, the Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Receivables as and
when the same shall become due, and shall follow such collection procedures as
it follows with respect to all comparable motor vehicle receivables that it
services for itself and otherwise act with respect to the Receivables in such
a manner as will, in the reasonable judgment of the Servicer, maximize the
amount to be received by the Trust with respect thereto. The Servicer is
authorized in its discretion to waive any prepayment charge, late payment
charge or any other similar fees that may be collected in the ordinary course
of servicing any Receivable.
(b) The Servicer may grant payment extensions only to the extent
permissible in its Collection and Servicing Guidelines as in effect from time
to time; provided, that no such extension shall extend the final payment date
on any Receivable beyond the last day of the Collection Period ending six
months prior to the Certificate Final Scheduled Distribution Date.
(c) Upon any extension not in accordance with this Section, the Servicer
shall be required to purchase the related Receivable in accordance with
Section 4.07.
(d) With respect to each Owners Choice Receivable, the Servicer, in
accordance with its customary servicing standards, policies, practices and
procedures, shall contact the Obligor on or before the due date of the Balloon
Payment specified in the related Contract. If, at such time, the Obligor under
the Owners Choice Receivable has notified BMW FS on behalf of the Trust that
it elects to sell the Financed Vehicle to BMW FS, on behalf of the Trust, in
accordance with the terms of the Receivable, the Servicer shall, upon delivery
of the Financed Vehicle by the Obligor to BMW FS on behalf of the Trust,
inspect or cause to be inspected the Financed Vehicle for excess wear and tear
and excess mileage, and to determine the necessity of any repairs. Pursuant to
its normal servicing programs, the Servicer may offer to any Obligor the right
to sell the Financed Vehicle prior to the maturity date of the related
Receivable.
(e) In connection with an Obligor's transfer of a Financed Vehicle to BMW
FS on behalf of the Trust in satisfaction of its obligation to pay the Balloon
Payment under an Owners Choice Receivable, pursuant to the terms of the
Contract related to such Balloon Payment, the Servicer shall require the
Obligor to pay a disposition fee (which the Servicer will retain as servicing
compensation), whereupon the Servicer shall take possession of the related
Financed Vehicle and shall prepare such Financed Vehicle for sale at auction
or otherwise in accordance with the Servicer's customary servicing standards,
policies, practices and procedures.
(f) Proceeds received by the Servicer from the payment by an Obligor of a
Financed Vehicle of amounts attributable to Balloon Payments and other amounts
(including Excess Wear and Tear and Excess Mileage) owed by the Obligor or
from the sale of a Financed Vehicle at auction or otherwise constitute
proceeds of Balloon Payments and collections on the Receivables, and shall be
deposited into the Collection Account. Following the sale of the Financed
Vehicle, the Servicer, on behalf of the Trust, shall deliver the related
certificate of title to the purchaser of such Financed Vehicle. Following the
Servicer's receipt of proceeds from the sale of such Financed Vehicle and
amounts to be paid by the Obligor, the Servicer shall record on its books and
records the termination of the Trust's ownership and security interest in the
related Owners Choice Receivable (and shall deliver copies thereof to the
Indenture Trustee and the Owner Trustee upon written request within ten days
of receipt of such request).
(g) If the Obligor under any Owners Choice Receivable has notified the
Dealer that it desires to refinance the amount that it owes on termination of
the Receivable, BMW FS will, in accordance with its customary servicing
standards, policies, practices and procedures, make a decision to grant or
deny credit, except for Contracts for which the Obligors have the right to
refinance without such an assessment, in which case BMW FS shall honor the
Obligor's right to refinance. If credit is denied, the Servicer shall require
the Obligor to satisfy its obligation to pay the remaining amounts owed in
accordance with the terms of the Owners Choice Receivable. If credit is
granted, BMW FS shall deposit an amount equal to the total amount owed by the
Obligor on the Receivable to the Collection Account. Upon deposit of such
amount into the Collection Account, the Trust's ownership and security
interest in the related Financed Vehicle shall terminate, and the Trust will
assign all interest in, to and under the Receivable and the related Financed
Vehicle to BMW FS. The Servicer shall record such termination on its books and
records (and shall deliver copies thereof to the Indenture Trustee and the
Owner Trustee upon written request within ten Business Days of receipt of such
request).
(h) Notwithstanding anything herein or in any contract to the contrary,
in the event that the Obligor elects to sell a Financed Vehicle to BMW FS
pursuant to an Owners Choice Receivable, the Servicer shall have no
responsibility to the Trust for any excess of the Balloon Payment over the
proceeds of sale of the Financed Vehicle by the Servicer minus the disposition
fee.
Section 4.03. Realization upon Receivables. Consistent with its customary
procedures, the Servicer shall use its best efforts to repossess or otherwise
convert the ownership of and liquidate any Financed Vehicle securing a
Receivable with respect to which the Servicer shall have determined that
eventual payment in full is unlikely and with respect to which the Servicer
determines that such repossession or other action to be in the best interest
of the Trust.
Section 4.04. Physical Damage Insurance. The Servicer shall, in
accordance with its customary servicing procedures, require each Obligor to
obtain and maintain physical loss damage insurance covering the related
Financed Vehicle as of the execution of the related Receivable.
Section 4.05. Maintenance of Security Interests in Financed Vehicles.
(a) The Servicer shall, in accordance with its customary servicing
procedures, take such steps as are reasonably necessary to maintain perfection
of the security interest created by each Receivable in the related Financed
Vehicle. The Servicer is hereby authorized to take such steps as are necessary
to re-perfect such security interest in the event of the relocation of a
Financed Vehicle, or for any other reason. In the event that the assignment of
a Receivable to the Issuer is insufficient, without a notation on the related
Financed Vehicle's certificate of title, or without fulfilling any additional
administrative requirements under the laws of the State in which such Financed
Vehicle is located, to perfect a security interest in the related Financed
Vehicle in favor of the Issuer, the Servicer hereby agrees that the
designation of BMW FS as the secured party on the certificate of title is in
its capacity as agent of the Issuer.
(b) The Depositor, the Owner Trustee, the Indenture Trustee and the
Servicer hereby agree that, upon the occurrence of a Servicer Termination
Event, the Controlling Party may take or cause to be taken such actions as
may, in the opinion of counsel to the Controlling Party, be necessary to
perfect or re-perfect the security interests in the Financed Vehicles in the
name of the Issuer, including by amending the title documents of the Financed
Vehicles. The Servicer hereby agrees to pay all expenses related to such
perfection or reperfection and to take all action necessary therefor. If such
expenses are not paid within 15 days after delivery of any invoice for such
expenses to the Servicer, such expenses shall be paid pursuant to Section
5.06(b)(ix).
Section 4.06. Covenants of Servicer. By its execution and delivery of
this Agreement, the Servicer hereby covenants as follows (upon which covenants
the Issuer, the Indenture Trustee and the Owner Trustee rely in accepting the
Receivables and delivering the applicable Securities):
(a) Liens in Force. No Financed Vehicle securing a Receivable shall be
released in whole or in part from the security interest granted by such
Receivable, except upon payment in full of such Receivable or as otherwise
contemplated herein;
(b) No Impairment. The Servicer shall do nothing to impair the rights of
the Trust in the property of the Trust;
(c) No Amendments. The Servicer shall not extend or otherwise amend the
terms of any Receivable, except in accordance with Section 4.02; and
(d) Restrictions on Liens. The Servicer shall not (A) create, incur or
suffer to exist, or agree to create, incur or suffer to exist, or consent to
or permit in the future (upon the occurrence of a contingency or otherwise)
the creation, incurrence or existence of any Lien on or restriction on
transferability of any Receivable except for the Lien of the Indenture and the
restrictions on transferability imposed by this Agreement or (B) other than as
contemplated herein, sign or file any UCC financing statements in any
jurisdiction that names BMW FS or the Depositor as a debtor, and any Person
other than the Depositor, the Indenture Trustee or the Issuer as a secured
party, or sign any security agreement authorizing any secured party thereunder
to file any such financing statement, in each case with respect to the
Receivables or the related property.
Section 4.07. Purchase of Receivables Upon Breach. Upon discovery by any
of the Servicer, the Sellers, the Depositor, the Owner Trustee or the
Indenture Trustee of a breach of any of the covenants set forth in Sections
4.02(b), 4.05(a) or 4.06, the party discovering such breach shall give prompt
written notice to the other; provided, however, that the failure to give any
such notice shall not affect any obligation of the Servicer under this Section
4.07. On or before the last day of the first Collection Period following its
discovery or receipt of notice of the breach of any covenant set forth in
Sections 4.02(b), 4.05(a) or 4.06 that materially and adversely affects the
interests of the Issuer, the Indenture Trustee, the Owner Trustee, the
Certificateholders or the Noteholders in any Receivable, the Servicer shall,
unless such breach shall have been cured in all material respects by such
date, purchase from the Issuer the Receivable affected by such breach. In
consideration of the purchase of any such Receivable, the Servicer shall remit
the related Purchase Amount into the Collection Account, with written notice
to the Indenture Trustee of such deposit, in the manner specified in Section
5.04. Subject to Section 7.02, it is understood and agreed that the obligation
of the Servicer to purchase any Receivable with respect to which such a breach
has occurred and is continuing shall, if such obligation is fulfilled,
constitute the sole remedy against the Servicer for such breach available to
the Issuer, the Owner Trustee, the Indenture Trustee, the Certificateholders
or the Noteholders.
Section 4.08. Servicing Fee. The Servicing Fee shall be payable to the
Servicer on each Distribution Date. That part of the Servicing Fee based on
the Servicing Fee Rate shall be calculated on the basis of a 360-day year
comprised of twelve 30-day months. The Servicer shall be required to pay all
expenses incurred by it in connection with its activities under this Agreement
(including taxes imposed on the Servicer and expenses incurred in connection
with distributions and reports made by the Servicer to the Owner Trustee and
the Indenture Trustee).
Section 4.09. Servicer's Certificate. Not later than 10:00 a.m. (New York
City time) on each Determination Date, the Servicer shall deliver to the Owner
Trustee, the Indenture Trustee and the Depositor, with a copy to each Rating
Agency and Salomon Smith Barney Inc., a Servicer's Certificate containing all
information necessary to make the distributions to be made on the related
Distribution Date pursuant to Section 5.06 for the related Collection Period
and any other information the Indenture Trustee may reasonably request. Such
Servicer's Certificate shall be certified by a Responsible Officer of the
Servicer that the information provided is complete and no defaults have
occurred. Receivables to be purchased by the Servicer or to be repurchased by
either Seller and each Receivable that became a Liquidated Receivable shall be
identified by the Servicer by account number with respect to such Receivable
(as specified in the applicable Schedule of Receivables).
Section 4.10. Annual Statement as to Compliance; Notice of Servicer
Termination Event.
(a) The Servicer shall deliver to the Owner Trustee, the Indenture
Trustee and each Rating Agency, within 120 days after the end of the
Servicer's fiscal year, an Officer's Certificate signed by a Responsible
Officer of the Servicer, stating that (i) a review of the activities of the
Servicer during the preceding 12-month period (or such shorter period in the
case of the first such Officer's Certificate) and of the performance of its
obligations under this Agreement has been made under such officer's
supervision and (ii) to such officer's knowledge, based on such review, the
Servicer has fulfilled all its obligations under this Agreement throughout
such period or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer and the nature
and status thereof.
(b) The Servicer shall deliver to the Owner Trustee, the Indenture
Trustee and each Rating Agency, promptly after having obtained knowledge
thereof, but in no event later than two Business Days thereafter, written
notice in an Officer's Certificate of any event that is a Servicer Termination
Event under Section 8.01.
Section 4.11. Annual Independent Accountants' Report. The Servicer shall
cause a firm of independent certified public accountants, which may also
render other services to the Servicer or its Affiliates, to deliver to the
Owner Trustee, the Indenture Trustee and each Rating Agency, within 120 days
after the end of each fiscal year, a report addressed to the Board of
Directors of the Servicer, the Owner Trustee and the Indenture Trustee, to the
effect that (i) the firm is independent of the Depositor and the Servicer
within the meaning of the Code of Professional Ethics of the American
Institute of Certified Public Accountants; (ii) a review in accordance with
agreed-upon procedures was made of the Servicer's Certificates relating to
such fiscal year, including the delinquency, default and loss statistics
required to be specified therein and, except as disclosed in the accountants'
report, no exceptions or errors in the Servicer's Certificates were found; and
(iii) a review in accordance with agreed-upon procedures was made of the
Servicer's compliance with its servicing obligations in this Agreement,
including without limitation the obligations of the Servicer set forth in
Section 4.02(b) hereof, and, except as disclosed in the accountants' report,
no exceptions to such compliance were found.
Section 4.12. Access to Certain Documentation and Information Regarding
Receivables. The Servicer shall provide to representatives of the Owner
Trustee, the Indenture Trustee, the Certificateholders and the Noteholders
reasonable access to the documentation regarding the Receivables and the
related Trust property. Access shall be afforded without charge, but only upon
reasonable request, which does not unreasonably interfere with the Servicer's
normal business operations or employee or customer relations, and during the
normal business hours at the offices of the Servicer. Nothing in this Section
shall affect the obligation of the Servicer to observe any applicable law
prohibiting disclosure of information regarding the Obligors and the failure
of the Servicer to provide access to information as a result of such
obligation shall not constitute a breach of this Section.
Section 4.13. Term of Servicer. The Servicer hereby covenants and agrees
to act as Servicer under, and for the term of, this Agreement.
Section 4.14. Access to Information Regarding Trust and Basic Documents.
The Servicer shall furnish to the Owner Trustee from time to time such
information regarding the Trust or the Basic Documents as the Owner Trustee
shall reasonably request. The Indenture Trustee shall furnish to the Owner
Trustee annually a copy of the Note Register. The Servicer shall furnish to
the Owner Trustee copies of all documents and reports required to be provided
by the Servicer pursuant to this Article IV of the Sale and Servicing
Agreement.
<PAGE>
ARTICLE V
DISTRIBUTIONS; STATEMENTS TO SECURITYHOLDERS
Section 5.01. Establishment of Accounts.
(a) The Servicer, for the benefit of the Noteholders and the
Certificateholders, shall establish and maintain in the name of the Indenture
Trustee an Eligible Deposit Account (the "Collection Account"), bearing a
designation clearly indicating that the funds deposited therein are held for
the benefit of the Noteholders and the Certificateholders.
(b) The Issuer, for the benefit of the Noteholders, shall cause the
Indenture Trustee to establish with and maintain in the name of the Indenture
Trustee an Eligible Deposit Account (the "Note Distribution Account"), bearing
a designation clearly indicating that the funds deposited therein are held for
the benefit of the Noteholders.
(c) The Issuer, for the benefit of the Noteholders and the
Certificateholders, shall cause the Indenture Trustee to establish with and
maintain in the name of the Indenture Trustee:
(i) an Eligible Deposit Account (the "Reserve Account"), bearing a
designation clearly indicating that the funds deposited therein are held
for the benefit of the Noteholders and the Certificateholders.
(ii) an Eligible Deposit Account (the "Pre-Funding Account"),
bearing a designation clearly indicating that the funds deposited therein
are held for the benefit of the Noteholders and the Certificateholders.
(iii) an Eligible Deposit Account (the "Capitalized Interest
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Noteholders and the
Certificateholders.
(iv) an Eligible Deposit Account (the "Certificate Interest Reserve
Account") bears a designation clearly indicating that the funds deposited
therein are held for the benefit of the Certificateholders.
(d) Funds on deposit in the Collection Account, the Capitalized Interest
Account, the Pre-Funding Account, the Certificate Interest Reserve Account and
the Reserve Account shall be invested by the Indenture Trustee in Eligible
Investments selected in writing by the Servicer; provided, however, that if
the Servicer fails to select any Eligible Investment, the Indenture Trustee
shall invest such funds in an Eligible Investment described in clause (d) of
the definition of "Eligible Investment" herein. All such Eligible Investments
shall be held by the Indenture Trustee for the benefit of the Noteholders
and/or the Certificateholders, as applicable; provided, that such amount shall
be calculated on the Determination Date and on each Distribution Date all
interest and other investment income (net of Net Investment Losses) on funds
on deposit in the Collection Account for the related Collection Period shall
be paid to the Servicer as part of the servicing compensation or to the
Indenture Trustee as compensation. Other than as permitted in writing by the
Rating Agencies, funds on deposit in the Trust Accounts shall be invested in
Eligible Investments that will mature not later than the Business Day
immediately preceding the next Distribution Date. Funds deposited in a Trust
Account on a day that immediately precedes a Distribution Date upon the
maturity of any Eligible Investments are not required to be invested
overnight.
(e) In the event that there are Net Investment Losses in Eligible
Investments chosen by the Servicer, the Servicer shall deposit into the
Collection Account, no later than one (1) Business Day prior to the
Distribution Date, the amount of the Net Investment Losses. The Indenture
Trustee shall not be held liable in any way for any Net Investment Losses,
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 Indenture Trustee, in
accordance with their terms.
(f) (i) The Indenture Trustee shall possess all right, title and interest
in all funds and investment property on deposit from time to time in or
credited to the Trust Accounts and in all proceeds thereof (including all
income thereon) and all such funds, investment property, proceeds and income
shall be part of the Trust Estate, except as otherwise set forth herein. The
Trust Accounts shall be under the sole dominion and control of the Indenture
Trustee for the benefit of the Noteholders and the Certificateholders, as
applicable. If, at any time, any Trust Account ceases to be an Eligible
Deposit Account, the Indenture Trustee (or the Servicer on its behalf) shall
within 10 Business Days (or such longer period, not to exceed 30 calendar
days, as to which each Rating Agency may consent) establish a new Trust
Account as an Eligible Deposit Account and shall transfer any cash and/or any
investments from the account that is no longer an Eligible Deposit Account to
the Trust Account.
(ii) With respect to the Trust Account Property, the Indenture
Trustee agrees, by its acceptance hereof, that:
(A) any Trust Account Property that is held in deposit accounts
shall be held solely in the Eligible Deposit Accounts, subject to the last
sentence of Section 5.01(f)(i); and each such Eligible Deposit Account shall
be subject to the exclusive custody and control of the Indenture Trustee, and
the Indenture Trustee shall have sole signature authority with respect
thereto;
(B) any Trust Account Property that constitutes Physical Property
shall be delivered to the Indenture Trustee in accordance with paragraph (a)
of the definition of "Delivery" and shall be held, pending maturity or
disposition, solely by the Indenture Trustee or a securities intermediary (as
such term is defined in Section 8-102 of the UCC) acting solely for the
Indenture Trustee;
(C) any Trust Account Property that is a book-entry security held
through the Federal Reserve System pursuant to federal book-entry regulations
shall be delivered in accordance with paragraph (b) of the definition of
"Delivery" and shall be maintained by the Indenture Trustee, pending maturity
or disposition, through continued book-entry registration of such Trust
Account Property as described in such paragraph;
(D) any Trust Account Property that is an "uncertificated security"
under Article 8 of the UCC and that is not governed by clause (C) above shall
be delivered to the Indenture Trustee in accordance with paragraph (c) of the
definition of "Delivery" and shall be maintained by the Indenture Trustee,
pending maturity or disposition, through continued registration of the
Indenture Trustee's (or its nominee's) ownership of such security; and
(E) any Trust Account Property that is a security entitlement shall
be delivered in accordance with paragraph (d) of the definition herein of
"Delivery" and shall be held pending maturity or disposition by the Indenture
Trustee or a securities intermediary acting solely for the Indenture Trustee.
(iii) The Servicer shall have the power, revocable by the Indenture
Trustee or by the Owner Trustee with the consent of the Indenture
Trustee, following a Servicer Termination Event to instruct the Indenture
Trustee to make withdrawals and payments from the Trust Accounts, the
Certificate Interest Reserve Account and the Certificate Distribution
Account for the purpose of withdrawing any amounts deposited in error
into such accounts.
Section 5.02. Collections. The Servicer shall remit to the Collection
Account all payments by or on behalf of the Obligors with respect to the
Receivables (other than Purchased Receivables), all Liquidation Proceeds and
any subsequent Recoveries on the Business Day prior to the Distribution Date
for so long as BMW Capital has the Minimum Required Rating. So long as BMW
Capital has the Minimum Required rating, the Servicer will remit all such
amounts described in the preceding sentence within two (2) Business Days of
receipt to an account established and maintained by BMW Capital. If BMW
Capital no longer has the Minimum Required Rating, the Servicer shall remit to
the Collection Account all payments by or on behalf of the Obligors with
respect to the Receivables (other than Purchased Receivables), all Liquidation
Proceeds and any subsequent Recoveries within two Business Days of receipt
thereof. Notwithstanding anything herein to the contrary, so long as BMW FS is
the Servicer, BMW FS may withhold from the deposit into the Collection Account
any amounts indicated on the related Servicer's Certificate as being due and
payable to the Sellers or BMW Receivables and pay such amounts directly to the
Sellers or BMW Receivables, as applicable. For purposes of this Article V, the
phrase "payments by or on behalf of Obligors" shall mean payments made with
respect to the Receivables by Persons other than the Servicer or the Sellers.
Section 5.03. Application of Collections.
All payments received from or on behalf of an Obligor during each
Collection Period with respect to each Receivable (other than a Purchased
Receivable), shall be applied to interest and principal in accordance with the
Simple Interest Method.
Section 5.04. Purchase Amounts. If BMW Capital has the Minimum Required
Rating, the Servicer and the Sellers shall deposit or cause to be deposited in
the Collection Account the Purchase Amount as described in the first sentence
of Section 5.02. So long as BMW Capital has the Minimum Required Rating, the
Servicer will deposit the Purchase Amount into an account established and
maintained by BMW Capital, such deposit being made within two (2) Business
Days of the event giving rise to such Purchase Amounts. If BMW Capital no
longer has the Minimum Required Rating, the Servicer or the Sellers shall
deposit or cause to be deposited in the Collection Account, on or prior to
each Determination Date, the aggregate Purchase Amount with respect to
Purchased Receivables and the Servicer shall deposit therein all amounts to be
paid under Section 4.07 and Section 9.01.
Section 5.05. Reserved.
Section 5.06. Distributions.
(a) On each Determination Date, the Servicer shall calculate all amounts
required to be deposited pursuant to this Section and deliver a Servicer's
Certificate pursuant to Section 4.09.
(b) On each Distribution Date, the Servicer shall instruct the Indenture
Trustee in writing (based on the information contained in the Servicer's
Certificate delivered on the related Determination Date pursuant to Section
4.09) to make the following deposits and distributions from amounts on deposit
in the Collection Account, to the extent of the Total Distribution Amount for
such Distribution Date, including all amounts transferred to the Collection
Account from the Reserve Account pursuant to Section 5.07(b), to make required
payments and distributions on such date pursuant to clauses (i) through (x)
below, in the following order and priority:
(i) to the Servicer, the Servicing Fee (and any accrued and unpaid
Servicing Fees from prior Collection Periods) and following a Servicer
Termination Event, to the successor Servicer, reasonably incurred
Servicer transition costs up to an aggregate of $150,000 for all
Distribution Dates;
(ii) to the Note Distribution Account and distribution to the
Noteholders, from the Total Distribution Amount remaining after the
application of clause (i), the Noteholders' Interest Distributable
Amount;
(iii) to the Note Distribution Account and distribution to the
Noteholders, from the Total Distribution Amount remaining after the
application of clauses (i) and (ii), the Noteholders' Principal
Distributable Amount;
(iv) to the Certificate Distribution Account and distribution to the
Certificateholders, from the Total Distribution Amount remaining after
the application of clauses (i) through (iii), the Certificateholders'
Interest Distributable Amount;
(v) to the Certificate Distribution Account and distribution to the
Certificateholders, from the Total Distribution Amount remaining after
the application of clauses (i) through (iv), the Certificateholders'
Principal Distributable Amount;
(vi) to the Reserve Account, from the Total Distribution Amount
remaining after the application of clauses (i) through (v), any
deficiency in the Reserve Account Required Amount;
(vii) to the Certificate Interest Reserve Account, from the Total
Distribution Amount remaining after the application of clauses (i)
through (vi), any deficiency in the Certificate Interest Reserve Account
Required Amount;
(viii) to the Indenture Trustee and the Owner Trustee, from the
Total Distribution Amount remaining after the application of clauses (i)
through (vii), any accrued and unpaid fees, expenses and indemnification
expenses owed thereto under any of the Basic Documents to the extent not
otherwise paid (including legal fees and expenses) and to the Securities
Intermediary, any accrued and unpaid indemnification expenses owed to it;
(ix) from the Total Distribution Amount remaining after the
application of clauses (i) through (viii), any costs associated with the
perfection of security interests in the Financed Vehicles to the extent
not paid by the Servicer; and
(x) the remainder, if any, of the Total Distribution Amount to BMW
Receivables.
Notwithstanding that the Notes have been paid in full, the Indenture
Trustee shall continue to maintain the Collection Account hereunder until the
Certificate Balance is reduced to zero.
Section 5.07. Reserve Account.
(a) On or prior to the Closing Date, the Issuer shall cause to have
deposited an amount equal to the Reserve Account Initial Deposit into the
Reserve Account from the net proceeds of the sale of the Securities. The
Reserve Account shall be an asset of the Issuer.
(b) In the event that the Servicer's Certificate states that there is a
Distribution Date Payment Shortfall, then the Indenture Trustee shall withdraw
the Reserve Account Withdrawal Amount from the Reserve Account and deposit
such Reserve Account Withdrawal Amount into the Collection Account no later
than 12:00 noon, New York City time, on the Business Day prior to the related
Distribution Date.
(c) In the event that the amount on deposit in the Reserve Account (after
giving effect to all deposits thereto and withdrawals therefrom on such
Business Day prior to a Distribution Date) is greater than the Reserve Account
Required Amount on any Distribution Date, the Indenture Trustee shall release
and distribute all such amounts on such Distribution Date to BMW FS
Receivables Corporation. Upon any such distribution to BMW FS Receivables
Corporation, the Noteholders shall have no further rights in, or claims to,
such amounts.
(d) In the event that, on any Distribution Date, the amount on deposit in
the Reserve Account shall be less than the Reserve Account Required Amount,
the Total Distribution Amount remaining after the payment of the amounts set
forth in Section 5.06(b)(i) through (v), up to an amount equal to such
shortfall, shall be deposited by the Indenture Trustee to the Reserve Account
on such Distribution Date.
(e) Subject to Section 9.01, amounts will continue to be applied pursuant
to Section 5.06 following payment in full of both the Outstanding Amount of
the Notes and of the Certificate Balance of the Certificates until the Pool
Balance is reduced to zero. Following the payment in full of the aggregate
Outstanding Amount of the Notes and of the Certificate Balance and of all
other amounts owing or to be distributed hereunder or under the Indenture or
the Trust Agreement to Noteholders and the termination of the Trust, any
amount then allocated to the Reserve Account shall be paid to BMW FS
Receivables Corporation.
Section 5.08. Statements to Securityholders. On each Determination Date,
the Servicer shall provide to the Indenture Trustee (with a copy to each
Rating Agency, Salomon Smith Barney Inc. and each Paying Agent (if any)) for
the Indenture Trustee to forward to each Noteholder of record as of the most
recent Record Date and to the Owner Trustee (with a copy to each Paying Agent
(if any)) for the Owner Trustee to forward to each Certificateholder of record
as of the most recent Record Date a statement substantially in the form of
Exhibit B setting forth at least the following information as to the
Securities to the extent applicable:
(a) the amount of collections received with respect to the Receivables
during the related Collection Period and allocable to principal allocable to
each Class of Notes and Certificates on such Distribution Date;
(b) the amount of collections received with respect to the Receivables
during the related Collection Period and allocable to interest allocable to
each Class of Notes and Certificates on such Distribution Date;
(c) the Outstanding Amount of each Class of Notes, the Note Pool Factor
for each such Class, the Certificate Balance and the Certificate Pool Factor
as of the close of business on the preceding Distribution Date, after giving
effect to payments allocated to principal reported under clause (a) above;
(d) the amount of the Servicing Fee paid to the Servicer and the amount
of any fees payable to the Owner Trustee, the Custodian or the Indenture
Trustee with respect to the related Collection Period;
(e) the aggregate amounts of Realized Losses, if any, with respect to the
related Collection Period;
(f) the Pool Balance as of the close of business on the last day of the
related Collection Period, after giving effect to payments allocated to
principal reported under clause (a) above;
(g) the balance of the Reserve Account and the Certificate Interest
Reserve Account on the related Determination Date after giving effect to
deposits and withdrawals to be made on such Distribution Date, if any;
(h) the amount of any deposit to the Reserve Account and the Certificate
Interest Reserve Account and the amount and application of any funds withdrawn
from the Reserve Account and the Certificate Interest Reserve Account, in each
case with respect to such Distribution Date;
(i) the aggregate principal balance of all Receivables that became
Liquidated Receivables or Purchased Receivables during the related Collection
Period;
(j) the aggregate principal balance and number of Receivables that are 30
to 59 days, 60 to 89 days or 90 days or more delinquent as of the last day of
the related Collection Period;
(k) the Class A-1 Interest Carryover Shortfall, the Class A-2 Interest
Carryover Shortfall, the Class A-3 Interest Carryover Shortfall, the Class A-4
Interest Carryover Shortfall and the Certificateholders' Interest Carryover
Shortfall, in each case after giving effect to payments on such Distribution
Date, and any change in such amounts from the preceding statement;
(l) the aggregate Purchase Amounts for Receivables, if any, that were or
are to be purchased during or with respect to such Collection Period;
(m) the aggregate Principal Balance and number of all Receivables with
respect to which the related Financed Vehicle was repossessed;
(n) the aggregate Principal Balance and number of Receivables with
respect to which the Servicer granted a deferment;
(o) for each such date during the Funding Period, the remaining amount in
the Pre-Funding Account and the Capitalized Interest Account;
(p) the Pre-Funded Amount remaining following the end of the Funding
Period that was not used to fund the purchase of Subsequent Receivables and is
being passed through as payments on the Notes; and
(q) the Yield Supplement Overcollateralization Amount for the next
Distribution Date.
Each amount set forth on the Distribution Date statement under clauses
(a), (b) or (k) above shall be expressed as a dollar amount per $1,000 of
original principal balance of a Certificate or Note, as applicable.
Section 5.09. Pre-Funding Account.
(a) On the Closing Date, the Issuer shall cause the Indenture Trustee to
deposit in the Pre-Funding Account the Pre-Funded Amount from the net proceeds
of the sale of the Notes. On the Subsequent Transfer Date, upon satisfaction
of the conditions set forth in Section 2.01(b) with respect to such transfer,
the Servicer shall instruct the Indenture Trustee in writing to withdraw from
the Pre-Funding Account an amount equal to (i) the Principal Balance of the
Subsequent Receivables transferred to the Issuer on such Subsequent Transfer
Date less the Reserve Account Subsequent Deposit Amount for such Subsequent
Transfer Date, to distribute such amount to or upon the order of the Depositor
and (ii) the Reserve Account Subsequent Deposit Amount for such Subsequent
Transfer Date and, on behalf of the Issuer, to deposit such amount in the
Reserve Account.
(b) If the Pre-Funded Amount has not been reduced to zero on the last day
of the Funding Period after giving effect to any reductions in the Pre-Funded
Amount on such date pursuant to paragraph (a) above, the Servicer shall
instruct the Indenture Trustee in writing to withdraw from the Pre-Funding
Account on the Mandatory Redemption Date (i) if the Pre-Funded Amount is equal
to or less than $100,000, the Pre-Funded Amount and deposit such amount in the
Note Distribution Account to be applied to reduce the Outstanding Amount of
the Class A-1 Notes and (ii) if the Pre-Funded Amount is greater than
$100,000, amounts equal to the product of the Pre-Funded Percentage for each
Class of Notes and the Pre-Funded Amount and deposit such amounts in the Note
Distribution Account to be applied in reduction of the Outstanding Amount of
each Class of Notes. The Pre-Funding Account will be an asset of the Issuer.
Section 5.10. Capitalized Interest Account.
(a) On the Closing Date, the Issuer shall cause the Indenture Trustee to
deposit in the Capitalized Interest Account the Capitalized Interest Initial
Deposit from the net proceeds of the sale of the Notes.
(b) No later than 12:00 noon, New York City time, on the Business Day
prior to each Distribution Date during the Funding Period, the Indenture
Trustee shall withdraw, based on the information contained in the Servicer's
Certificate delivered pursuant to Section 4.09, from the Capitalized Interest
Account an amount equal to the Capitalized Interest Distribution Amount and
deposit such amount into the Collection Account.
(c) On each Distribution Date, after the withdrawal, if any, pursuant to
clause (b), any amounts remaining on deposit in the Capitalized Interest
Account in excess of the Capitalized Interest Account Required Amount shall be
paid to BMW Receivables.
(d) At the end of the Funding Period, any amounts remaining in the
Capitalized Interest Account shall be paid to BMW Receivables. The Capitalized
Interest Account will be an asset of the Issuer.
Section 5.11. Certificate Interest Reserve Account.
(a) On or prior to the Closing Date, the Issuer shall cause to have
deposited the Certificate Interest Reserve Account Required Amount into the
Certificate Interest Reserve Account from the net proceeds of the sale of the
Securities.
(b) In the event that the amount of the Total Distribution Amount with
respect to any Determination Date is insufficient to pay the amounts payable
on the related Distribution Date pursuant to clause 5.06(b)(iv) (after
application of any amounts to be applied from the Reserve Account) (such
insufficiency, the "Certificateholder Interest Shortfall"), the Indenture
Trustee shall withdraw the lesser of the Certificateholder Interest Shortfall
and the amount on deposit in the Certificate Interest Reserve Account from the
Certificate Interest Reserve Account and deposit such amount into the
Collection Account no later than 12:00 noon, New York City time, on the
Business Day prior to the related Distribution Date.
(c) In the event that the amount on deposit in the Certificate Interest
Reserve Account (after giving effect to all deposits thereto and withdrawals
therefrom on such Business Day prior to a Distribution Date) is greater than
the Certificate Interest Reserve Account Required Amount on any Distribution
Date, the Indenture Trustee shall release and distribute all such amounts on
such Distribution Date to BMW Receivables. Upon any such distribution to BMW
Receivables, the Certificateholders shall have no further rights in, or claims
to, such amounts.
(d) On the Business Day following the Distribution Date on which the
Notes are retired, the Indenture Trustee shall withdraw all amounts on deposit
in the Certificate Interest Reserve Account and deposit such amounts into the
Reserve Account. The Certificate Interest Reserve Account will be an asset of
the Issuer.
Section 5.12. Advances by the Servicer.
(a) By the close of business on the day required by Section 5.02 hereof,
the Servicer shall deposit into the Collection Account, out of its own funds,
the related Advance.
(b) On each Distribution Date, the Servicer shall reimburse itself for
the Outstanding Amount Advanced to the extent of actual collections of late
scheduled payments.
(c) If the Servicer determines that any advance made pursuant to Section
5.12 has become a Nonrecoverable Advance and at the time of such determination
there exists an Outstanding Amount Advanced, then the Servicer shall reimburse
itself out of funds in the Collection Account for the amount of such
Nonrecoverable Advance, but only to the extent of such Outstanding Amount
Advanced.
<PAGE>
ARTICLE VI
THE DEPOSITOR
Section 6.01. Representations of Depositor. The Depositor makes the
following representations to the Issuer, the Servicer, the Indenture Trustee
and the Sellers and on which the Issuer relies in accepting the Receivables
and delivering the Securities. Such representations speak as of the execution
and delivery of this Agreement and as of the Closing Date in the case of the
Initial Receivables and as of the Subsequent Transfer Date in the case of the
Subsequent Receivables, and shall survive the sale, transfer and assignment of
the Receivables by the Depositor to the Issuer and the pledge thereof to the
Indenture Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Depositor is duly organized and
validly existing as a corporation in good standing under the laws of the State
of Delaware, with the corporate power and authority to own its properties and
to conduct its business as such properties are currently owned and such
business is presently conducted.
(b) Due Qualification. The Depositor is duly qualified to do business as
a foreign corporation in good standing, and has obtained all necessary
licenses and approvals in all jurisdictions where the failure to do so would
materially and adversely affect the Depositor's ability to transfer the
Receivables to the Trust pursuant to this Agreement or the validity or
enforceability of the Receivables.
(c) Power and Authority. The Depositor has the corporate power and
authority to execute and deliver this Agreement and the other Basic Documents
to which it is a party and to carry out their respective terms; the Depositor
has full power and authority to sell and assign the property to be sold and
assigned to and deposited with the Issuer, and the Depositor shall have duly
authorized such sale and assignment to the Issuer by all necessary corporate
action; and the execution, delivery and performance of this Agreement and the
other Basic Documents to which the Depositor is a party have been, and in the
case of the Subsequent Transfer Agreement, will be, duly authorized by the
Depositor by all necessary corporate action.
(d) Binding Obligation. This Agreement and the other Basic Documents to
which the Depositor is a party, when duly executed and delivered by the other
parties hereto and thereto, shall constitute legal, valid and binding
obligations of the Depositor, enforceable against the Depositor in accordance
with their respective terms, except as the enforceability thereof may be
limited by bankruptcy, insolvency, reorganization or similar laws now or
hereafter in effect relating to or affecting creditors' rights generally and
to general principles of equity (whether applied in a proceeding at law or in
equity).
(e) No Violation. The consummation of the transactions contemplated by
this Agreement and the other Basic Documents and the fulfillment of the terms
of this Agreement and the other Basic Documents shall not conflict with,
result in any breach of any of the terms or provisions of or constitute (with
or without notice or lapse of time, or both) a default under, the certificate
of incorporation or bylaws of the Depositor, or any indenture, agreement,
mortgage, deed of trust or other instrument to which the Depositor is a party
or by which it is bound; or result in the creation or imposition of any Lien
upon any of its properties pursuant to the terms of any such indenture,
agreement, mortgage, deed of trust or other instrument, other than this
Agreement and the other Basic Documents; or violate any law, order, rule or
regulation applicable to the Depositor of any court or federal or state
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Depositor.
(f) No Proceedings. There are no proceedings or investigations pending
or, to the Depositor's knowledge, threatened, against the Depositor before any
court, regulatory body, administrative agency or other tribunal or
governmental instrumentality having jurisdiction over the Depositor or its
properties: (i) asserting the invalidity of this Agreement or any other Basic
Document; (ii) seeking to prevent the issuance of the Notes or the
Certificates or the consummation of any of the transactions contemplated by
this Agreement or any other Basic Document; (iii) seeking any determination or
ruling that might materially and adversely affect the performance by the
Depositor of its obligations under, or the validity or enforceability of, this
Agreement or any other Basic Document; or (iv) seeking to adversely affect the
federal income tax attributes of the Trust, the Notes or the Certificates.
(g) No Consents. The Depositor is not required to obtain the consent of
any other party or any consent, license, approval, registration,
authorization, or declaration of or with any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity or
enforceability of this Agreement or any other Basic Document to which it is a
party that has not already been obtained.
Section 6.02. Corporate Existence. During the term of this Agreement, the
Depositor will keep in full force and effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation and will obtain and preserve its qualification to do business in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, the Basic Documents
and each other instrument or agreement necessary or appropriate to the proper
administration of this Agreement and the transactions contemplated hereby. In
addition, all transactions and dealings between the Depositor and its
Affiliates will be conducted on an arm's-length basis.
Section 6.03. Liability of Depositor; Indemnities. The Depositor shall be
liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Depositor under this Agreement (which shall not
include distributions on account of the Notes or the Certificates).
Section 6.04. Merger or Consolidation of, or Assumption of the
Obligations of, Depositor. Any Person with which the Depositor shall merge or
consolidate or which the Depositor shall permit to become the successor to the
Depositor's business shall execute an agreement of assumption of every
obligation of the Depositor under this Agreement and the other Basic
Documents. Whether or not such assumption agreement is executed, such
successor Person shall be the successor to the Depositor under this Agreement
without the execution or filing of any document or any further act on the part
of any of the parties to this Agreement. The Depositor shall provide prompt
notice of any merger, consolidation or succession pursuant to this Section
6.04 to the Owner Trustee, the Indenture Trustee, the Servicer, the
Securityholders and the Rating Agencies. Notwithstanding the foregoing, the
Depositor shall not merge or consolidate with any other Person or permit any
other Person to become a successor to the Depositor's business unless (w)
immediately after giving effect to such transaction, no representation or
warranty made pursuant to Section 3.02 or 6.01 shall have been breached (for
purposes hereof, such representations and warranties shall speak as of the
date of the consummation of such transaction), (x) the Depositor shall have
delivered to the Owner Trustee, the Indenture Trustee and the Servicer an
Officer's Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption comply
with this Section 6.04 and that all conditions precedent provided for in this
Agreement relating to such transaction have been complied with, (y) the Rating
Agency Condition shall have been satisfied and (z) the Depositor shall have
delivered to the Owner Trustee, the Indenture Trustee and the Servicer an
Opinion of Counsel stating that, in the opinion of such counsel, either (A)
all financing statements and continuation statements and amendments thereto
have been executed and filed that are necessary to preserve and protect the
interest of the Trust in the Receivables and reciting the details of such
filings or (B) no such action is necessary to preserve and protect such
interest.
Section 6.05. Limitation on Liability of Depositor and Others. The
Depositor and any director, officer, employee or agent of the Depositor may
rely in good faith on the advice of counsel or on any document of any kind,
prima facie properly executed and submitted by any Person respecting any
matters arising hereunder. The Depositor shall be under no obligation to
appear in, prosecute or defend any legal action that shall not be incidental
to its obligations under this Agreement and that in its opinion may involve it
in any expense or liability.
Section 6.06. Depositor May Own Securities. The Depositor and any
Affiliate thereof may in its individual or any other capacity become the owner
or pledgee of Securities with the same rights as it would have if it were not
the Depositor or an Affiliate thereof, except as expressly provided herein or
in any Basic Document.
Section 6.07. Depositor to Provide Copies of Relevant Securities Filings.
The Depositor shall provide or cause to be provided to the Servicer a copy of
any document filed by the Depositor subsequent to the date hereof with the
Securities and Exchange Commission pursuant to the Securities Act of 1933 or
the Securities Exchange Act of 1934 that relate specifically to the Trust, the
Notes or the Certificates.
Section 6.08. Amendment of Depositor's Organizational Documents. The
Depositor shall not amend its organizational documents except in accordance
with the provisions thereof.
<PAGE>
ARTICLE VII
THE SERVICER
Section 7.01. Representations of Servicer. The Servicer makes the
following representations upon which the Issuer is deemed to have relied in
acquiring the Receivables. Such representations speak as of the execution and
delivery of this Agreement and as of the Closing Date in the case of the
Initial Receivables and as of the Subsequent Transfer Date in the case of the
Subsequent Receivables, and shall survive the sale of the Receivables to the
Issuer and the pledge thereof to the Indenture Trustee pursuant to the
Indenture.
(a) Organization and Good Standing. The Servicer is a corporation duly
organized and validly existing under the laws of the State of Delaware. The
Servicer is duly authorized to own its properties and transact its business
and is in good standing in each jurisdiction in which the character of the
business transacted by it or any properties owned or leased by it requires
such authorization and in which the failure to be so authorized would have a
material adverse effect on the business, properties, assets, or condition
(financial or other) of the Servicer and its subsidiaries, considered as one
enterprise. The Servicer has, and at all relevant times had, the power,
authority and legal right to acquire, own, and service the Receivables.
(b) Licenses and Approvals. The Servicer has obtained all necessary
licenses and approvals, in all jurisdictions where the failure to do so would
materially and adversely affect the Servicer's ability to acquire, own and
service the Receivables.
(c) Power and Authority. The Servicer has the power and authority to
execute and deliver this Agreement and the other Basic Documents to which it
is a party and to carry out their respective terms; and the execution,
delivery and performance of this Agreement and the other Basic Documents to
which it is a party have been duly authorized by the Servicer by all necessary
action.
(d) Binding Obligation. This Agreement and the other Basic Documents to
which it is a party constitute legal, valid and binding obligations of the
Servicer, enforceable against the Servicer in accordance with their respective
terms, except as the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the enforcement of
creditors' rights generally and to general principles of equity whether
applied in a proceeding in equity or at law.
(e) No Violation. The consummation of the transactions contemplated by
this Agreement and the other Basic Documents to which it is a party and the
fulfillment of their respective terms shall not conflict with, result in any
breach of any of the terms and provisions of, or constitute (with or without
notice or lapse of time or both) a default under, the articles of association
or bylaws of the Servicer, or any indenture, agreement, mortgage, deed of
trust or other instrument to which the Servicer is a party or by which it is
bound; or result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement, mortgage,
deed of trust or other instrument, other than this Agreement and the other
Basic Documents, or violate any law, order, rule or regulation applicable to
the Servicer of any court or federal or state regulatory body, administrative
agency or other governmental instrumentality having jurisdiction over the
Servicer or any of its properties.
(f) No Proceedings. There are no proceedings or investigations pending
or, to the Servicer's knowledge, threatened, against the Servicer before any
court, regulatory body, administrative agency or other tribunal or
governmental instrumentality having jurisdiction over the Servicer or its
properties: (i) asserting the invalidity of this Agreement or any of the other
Basic Documents; (ii) seeking to prevent the issuance of the Securities or the
consummation of any of the transactions contemplated by this Agreement or any
of the other Basic Documents; (iii) seeking any determination or ruling that
might materially and adversely affect the performance by the Servicer of its
obligations under, or the validity or enforceability of, this Agreement or any
of the other Basic Documents; or (iv) seeking to adversely affect the federal
income tax or other federal, state or local tax attributes of the Securities.
Section 7.02. Indemnities of Servicer. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer and the representations made by the Servicer under
this Agreement:
(a) The Servicer shall indemnify, defend and hold harmless the Issuer,
the Owner Trustee, the Indenture Trustee, the Securityholders and the
Depositor and any of the officers, directors, employees and agents of the
Issuer, the Owner Trustee and the Indenture Trustee from and against any and
all costs, expenses, losses, damages, claims and liabilities arising out of or
resulting from the use, ownership or operation by the Servicer or any
Affiliate thereof of a Financed Vehicle, excluding any losses incurred in
connection with the sale of any repossessed Financed Vehicles in a
commercially reasonable manner and in compliance with the terms of this
Agreement.
(b) The Servicer shall indemnify, defend and hold harmless the Issuer,
the Owner Trustee, the Indenture Trustee, the Depositor, and their respective
officers, directors, agents and employees, and the Securityholders, from and
against any taxes that may at any time be asserted against any of such parties
with respect to the transactions contemplated in this Agreement, including any
sales, gross receipts, tangible or intangible personal property, privilege or
license taxes (but not including any federal or other income taxes, including
franchise taxes ), and any reasonable costs and expenses in defending against
the same.
(c) The Servicer shall indemnify, defend and hold harmless the Issuer,
the Owner Trustee, the Indenture Trustee, the Depositor, the Securityholders
and any of the officers, directors, employees or agents of the Issuer, the
Owner Trustee, the Depositor and the Indenture Trustee from and against any
and all costs, expenses, losses, claims, damages and liabilities to the extent
that such cost, expense, loss, claim, damage or liability arose out of, or was
imposed upon any such Person through, the gross negligence, willful
misfeasance or bad faith of the Servicer in the performance of its duties
under this Agreement or by reason of reckless disregard of its obligations and
duties under this Agreement.
For purposes of this Section, in the event of the termination of the
rights and obligations of BMW FS (or any successor thereto pursuant to Section
7.03) as Servicer pursuant to Section 8.02, or the resignation by such
Servicer pursuant to this Agreement, such Servicer shall be deemed to be the
Servicer pending appointment of a successor Servicer (other than the Indenture
Trustee) pursuant to Section 8.03.
Indemnification under this Section shall survive the resignation or
removal of the Servicer or the termination of this Agreement with respect to
acts of the Servicer prior thereto, and shall include reasonable fees and
expenses of counsel and reasonable expenses of litigation. If the Servicer
shall have made any indemnity payments pursuant to this Section and the Person
to or on behalf of whom such payments are made thereafter collects any of such
amounts from others, such Person shall promptly repay such amounts to the
Servicer, without interest.
Section 7.03. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer. Any Person (i) into which the Servicer may be merged
or consolidated, (ii) resulting from any merger or consolidation to which the
Servicer shall be a party, (iii) that acquires by conveyance, transfer or
lease substantially all of the assets of the Servicer or (iv) succeeding to
the business of the Servicer, which Person shall execute an agreement of
assumption to perform every obligation of the Servicer under this Agreement,
shall be the successor to the Servicer under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties to this Agreement. The Servicer shall provide notice of any merger,
consolidation or succession pursuant to this Section 7.03 to the Owner
Trustee, the Indenture Trustee and each Rating Agency. Notwithstanding the
foregoing, the Servicer shall not merge or consolidate with any other Person
or permit any other Person to become a successor to the Servicer's business
unless (i) immediately after giving effect to such transaction, no
representation or warranty made pursuant to Section 7.01 shall have been
breached (for purposes hereof, such representations and warranties shall speak
as of the date of the consummation of such transaction) and no event that,
after notice or lapse of time or both, would become a Servicer Termination
Event shall have occurred, (ii) the Servicer shall have delivered to the Owner
Trustee and the Indenture Trustee an Officer's Certificate and an Opinion of
Counsel each stating that such consolidation, merger or succession and such
agreement of assumption comply with this Section 7.03 and that all conditions
precedent provided for in this Agreement relating to such transaction have
been complied with and (iii) the Servicer shall have delivered to the Owner
Trustee and the Indenture Trustee an Opinion of Counsel stating that either
(A) all financing statements and continuation statements and amendments
thereto have been executed and filed that are necessary to preserve and
protect the interest of the Trust and the Indenture Trustee, respectively, in
the assets of the Trust and reciting the details of such filings or (B) no
such action shall be necessary to preserve and protect such interest. The
Servicer shall be permitted to transfer and assign its duties and obligations
under this Agreement to an affiliate that has succeeded to substantially all
of the assets and liabilities of the Servicer in connection with a
reorganization of the Servicer; provided that the resulting entity represents
and warrants that it is not less credit-worthy than the Servicer immediately
prior to such reorganization.
Section 7.04. Limitation on Liability of Servicer and Others.
(a) Neither the Servicer nor any of its directors, officers, employees or
agents shall be under any liability to the Issuer, the Depositor, the
Indenture Trustee, the Owner Trustee, the Noteholders or the
Certificateholders, except as provided in this Agreement, for any action taken
or for refraining from the taking of any action pursuant to this Agreement;
provided, however, that this provision shall not protect the Servicer or any
such Person against any liability that would otherwise be imposed by reason of
a breach of this Agreement or willful misfeasance, bad faith or negligence in
the performance of duties. The Servicer and any director, officer, employee or
agent of the Servicer may conclusively rely in good faith on the written
advice of counsel or on any document of any kind prima facie properly executed
and submitted by any Person respecting any matters arising under this
Agreement.
(b) The parties expressly acknowledge and consent to the Indenture
Trustee simultaneously acting in the capacity of successor Servicer and
Indenture Trustee. The Indenture Trustee may, in such capacities, discharge
its separate functions fully, without hindrance or regard to conflict of
interest principles, duty of loyalty principles or other breach of fiduciary
duties to the extent that any such conflict or breach arises from the
performance by the Indenture Trustee of express duties set forth in this
Agreement in any of such capacities.
Section 7.05. Appointment of Subservicer. The Servicer may at any time
appoint a subservicer to perform all or any portion of its obligations as
Servicer hereunder; provided however, that the Servicer shall remain obligated
and be liable to the Owner Trustee, the Indenture Trustee and the
Securityholders for the servicing and administering of the Receivables in
accordance with the provisions hereof without diminution of such obligation
and liability by virtue of the appointment of such subservicer and to the same
extent and under the same terms and conditions as if the Servicer alone were
servicing and administering the Receivables. The fees and expenses of any
subservicer shall be as agreed between the Servicer and such subservicer from
time to time, and none of the Owner Trustee, the Indenture Trustee, the Issuer
or the Securityholders shall have any responsibility therefor.
Section 7.06. Servicer Not to Resign.
(a) Subject to the provisions of Section 7.03, the Servicer shall not
resign from the obligations and duties imposed on it by this Agreement as
Servicer except upon a determination that the performance of its duties under
this Agreement shall no longer be permissible under applicable law.
(b) Notice of any determination that the performance by the Servicer of
its duties hereunder is no longer permitted under applicable law shall be
communicated to the Owner Trustee and the Indenture Trustee at the earliest
practicable time (and, if such communication is not in writing, shall be
confirmed in writing at the earliest practicable time) and any such
determination shall be evidenced by an Opinion of Counsel to such effect
delivered by the Servicer to the Owner Trustee and the Indenture Trustee
concurrently with or promptly after such notice. No resignation of the
Servicer shall become effective until a successor Servicer acceptable to the
Controlling Party shall have assumed the responsibilities and obligations of
the Servicer in accordance with Section 8.03. If no Servicer has been
appointed within 30 days of resignation or removal, the Controlling Party may
petition any court of competent jurisdiction for such appointment.
<PAGE>
ARTICLE VIII
DEFAULT
Section 8.01. Servicer Termination Events. For purposes of this
Agreement, the occurrence and continuance of any of the following shall
constitute a "Servicer Termination Event":
(a) any failure by the Servicer to deposit into the Collection Account
any proceeds or payment required to be so delivered under the terms of this
Agreement that continues unremedied for a period of five Business Days after
written notice is received by the Servicer or after discovery of such failure
by a Responsible Officer of the Servicer;
(b) failure by the Servicer to deliver to the Owner Trustee, the
Indenture Trustee and the Seller the Servicer's Certificate by the applicable
Determination Date, or to observe any covenant or agreement set forth in
Section 4.06 or in Section 7.01, which failure (i) materially and adversely
affects the rights of the Securityholders and (ii) continues unremedied for a
period of five Business Days after knowledge thereof by the Servicer or after
the date on which written notice of such failure requiring the same to be
remedied shall have been given to the Servicer by any of the Owner Trustee,
the Indenture Trustee or Noteholders evidencing not less than 50% of the
Outstanding Amounts of the Notes;
(c) 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 failure (i) materially and adversely affects the rights of the
Securityholders and (ii) continues unremedied for a period of 60 days after
discovery of such failure by a Responsible Officer of the Servicer or after
the date on which written notice of such failure requiring the same to be
remedied shall have been given to the Servicer by any of the Owner Trustee,
the Indenture Trustee or Noteholders evidencing not less than 50% of the
Outstanding Amounts of the Notes; or
(d) the occurrence of an Insolvency Event with respect to the Servicer.
Section 8.02. Consequences of a Servicer Termination Event. If a Servicer
Termination Event shall occur, the Indenture Trustee may, and at the direction
of Noteholders evidencing 50% of the Outstanding Amount of the Notes, shall
terminate all of the rights and obligations of the Servicer under this
Agreement by notice in writing to the Servicer. On or after the receipt by the
Servicer of such written notice, all authority, power, obligations and
responsibilities of the Servicer under this Agreement automatically shall pass
to, be vested in and become obligations and responsibilities of the successor
Servicer appointed by the Controlling Party; provided, however, that such
successor Servicer shall have no liability with respect to any obligation that
was required to be performed by the terminated Servicer prior to the date that
such successor Servicer becomes the Servicer or any claim of a third party
based on any alleged action or inaction of the terminated Servicer. The
successor Servicer is authorized and empowered by this Agreement to execute
and deliver, on behalf of the terminated Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments and to do or accomplish
all other acts or things necessary or appropriate to effect the purposes of
such notice of termination, whether to complete the transfer and endorsement
of the Receivables and related documents to show the Indenture Trustee (or the
Owner Trustee if the Notes have been paid in full) as lienholder or secured
party on the related certificates of title of the Financed Vehicles or
otherwise. The terminated Servicer agrees to cooperate with the successor
Servicer in effecting the termination of the responsibilities and rights of
the terminated Servicer under this Agreement, including the transfer to the
successor Servicer for administration by it of all money and property held by
the Servicer with respect to the Receivables and other records relating to the
Receivables, including any portion of the Receivables File held by the
Servicer and a computer tape in readable form as of the most recent Business
Day containing all information necessary to enable the successor Servicer to
service the Receivables. The terminated Servicer shall also provide the
successor Servicer access to Servicer personnel and computer records in order
to facilitate the orderly and efficient transfer of servicing duties.
Section 8.03. Appointment of Successor Servicer.
(a) On and after the time the Servicer receives a notice of termination
pursuant to Section 8.02 or upon the resignation of the Servicer pursuant to
Section 7.06, the Indenture Trustee shall be the successor in all respects to
the Servicer in its capacity as Servicer under this Agreement and shall be
subject to all the rights, responsibilities, restrictions, duties, liabilities
and termination provisions relating to the Servicer under this Agreement,
except as otherwise stated herein. The Depositor, the Owner Trustee, the
Indenture Trustee and such successor Servicer shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession. If a successor Servicer is acting as Servicer hereunder, it shall
be subject to termination under Section 8.02 upon the occurrence of any
Servicer Termination Event after its appointment as successor Servicer.
(b) On and after the time the Servicer receives a notice of termination
pursuant to Section 8.02 or upon the resignation of the Servicer pursuant to
Section 7.06, or if the Indenture Trustee is legally unable or unwilling to
act as Servicer, the Controlling Party may exercise at any time its right to
appoint a successor to the Servicer, and shall have no liability to the Owner
Trustee, the Indenture Trustee, the Servicer, the Depositor, any Noteholders,
any Certificateholders or any other Person if it does so. Notwithstanding the
above, if the Indenture Trustee shall be legally unable or unwilling to act as
Servicer, the Indenture Trustee, the Owner Trustee or Noteholders evidencing
50% of the Outstanding Amount of the Notes may petition a court of competent
jurisdiction to appoint any Eligible Servicer as the successor to the
Servicer. Pending appointment pursuant to the preceding sentence, the
Indenture Trustee shall act as successor Servicer unless it is legally unable
to do so, in which event the outgoing Servicer shall continue to act as
Servicer until a successor has been appointed and accepted such appointment.
(c) Upon appointment, the successor Servicer shall be the successor in
all respects to the predecessor Servicer and shall be subject to all the
responsibilities, duties and liabilities arising thereafter relating thereto
placed on the predecessor Servicer, and shall be entitled to the Servicing Fee
and all the rights granted to the predecessor Servicer by the terms and
provisions of this Agreement.
Section 8.04. Notification to Securityholders. Upon any termination of,
or appointment of a successor to, the Servicer pursuant to this Article VIII,
the Owner Trustee shall give prompt written notice thereof to the
Certificateholders, and the Indenture Trustee shall give prompt written notice
thereof to the Noteholders and each Rating Agency.
Section 8.05. Waiver of Past Defaults. Noteholders evidencing not less
than a majority of the Outstanding Amount of the Notes or the
Certificateholders evidencing not less than a majority of the outstanding
Certificate Balance (in the case of any default that does not adversely affect
the Indenture Trustee or the Noteholders) may, on behalf of all
Securityholders, waive in writing any default by the Servicer in the
performance of its obligations hereunder and its consequences, except a
default in making any required deposits to or payments from any of the Trust
Accounts in accordance with this Agreement. Upon any such waiver of a past
default, such default shall cease to exist, and any Servicer Termination Event
arising therefrom shall be deemed to have been remedied for every purpose of
this Agreement. No such waiver shall extend to any subsequent or other default
or impair any right consequent thereto.
<PAGE>
ARTICLE IX
TERMINATION
Section 9.01. Optional Purchase of All Receivables.
(a) On each Determination Date as of which the Pool Balance is equal to
or less than 10% of the sum of the Initial Pool Balance and the amount on
deposit in the Pre-Funding Account on the Closing Date, the Servicer shall
have the option to purchase the Receivables. To exercise such option, the
Servicer shall deposit to the Collection Account pursuant to Section 5.04 an
amount equal to the aggregate Purchase Amount for the Receivables (including
Liquidated Receivables) and shall succeed to all interests in and to the
Receivables. The exercise of such option shall effect a retirement, in whole
but not in part, of all outstanding Notes.
(b) As described in Article IX of the Trust Agreement, notice of any
termination of the Trust shall be given by the Servicer to the Owner Trustee
and the Indenture Trustee as soon as practicable after the Servicer has
received notice thereof.
(c) Following the satisfaction and discharge of the Indenture and the
payment in full of the principal of and interest on the Notes, the
Certificateholders will succeed to the rights of the Noteholders hereunder and
the Owner Trustee will succeed to the rights of, and assume the obligations to
make payments to Certificateholders of, the Indenture Trustee pursuant to this
Agreement.
<PAGE>
ARTICLE X
MISCELLANEOUS
Section 10.01. Amendment.
(a) This Agreement may be amended by the Depositor, the Servicer, the
Indenture Trustee and the Issuer, without the consent of any of the
Noteholders or the Certificateholders, to cure any ambiguity, to correct or
supplement any provisions in this Agreement or for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
in this Agreement or of modifying in any manner the rights of the Noteholders
or the Certificateholders; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel delivered to the Owner Trustee and the
Indenture Trustee, adversely affect in any material respect the interests of
any Noteholder or Certificateholder; provided further, that such action shall
not be deemed to adversely affect in any material respect the interests of any
Noteholder or Certificateholder and no Opinion of Counsel to that effect shall
be required if the person requesting the amendment obtains a letter from the
Rating Agencies stating that the amendment would not result in the downgrading
or withdrawal of the ratings then assigned to the Notes and the Certificates.
(b) This Agreement may also be amended from time to time by the
Depositor, the Servicer and the Issuer, with the prior written consent of the
Indenture Trustee, Noteholders holding not less than a majority of the
Outstanding Amount of the Notes and the Holders (as defined in the Trust
Agreement) of outstanding Certificates evidencing not less than a majority of
the outstanding Certificate Balance, for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Agreement or of modifying in any manner the rights of the Securityholders;
provided, however, that no such amendment shall (i) increase or reduce in any
manner the amount of, or accelerate or delay the timing of, collections of
payments on Receivables or distributions that shall be required to be made for
the benefit of the Securityholders or (ii) reduce the aforesaid percentage of
the Outstanding Amount of the Notes and the Certificate Balance, the
Securityholders of which are required to consent to any such amendment,
without the consent of the Noteholders holding all Outstanding Notes and
Certificateholders holding all outstanding Certificates.
Promptly after the execution of any amendment or consent, the
Administrator shall furnish written notification of the substance of such
amendment or consent to each Securityholder, the Indenture Trustee and each
Rating Agency.
It shall not be necessary for the consent of Securityholders pursuant to
this Section to approve the particular form of any proposed amendment or
consent, but it shall be sufficient if such consent shall approve the
substance thereof.
Prior to the execution of any amendment to this Agreement, the Owner
Trustee, on behalf of the Issuer, and the Indenture Trustee shall be entitled
to receive and rely upon an Opinion of Counsel stating that the execution of
such amendment is authorized or permitted by this Agreement and the Opinion of
Counsel referred to in Section 10.02(i)(A). The Owner Trustee, on behalf of
the Issuer, and the Indenture Trustee may, but shall not be obligated to,
enter into any such amendment that affects the Owner Trustee's or the
Indenture Trustee's, as applicable, own rights, duties or immunities under
this Agreement or otherwise.
Section 10.02. Protection of Title to Trust.
(a) The Servicer shall execute and file such financing statements and
cause to be executed and filed such continuation statements, all in such a
manner and in such places as may be required by law fully to preserve,
maintain and protect the interest of the Issuer and the Indenture Trustee in
the Receivables and the proceeds thereof. The Servicer shall deliver or cause
to be delivered to the Owner Trustee and the Indenture Trustee file-stamped
copies of, or filing receipts for, any document filed as provided above as
soon as available following such filing.
(b) Neither the Depositor nor the Servicer shall change its name,
identity or corporate structure in any manner that would, could or might make
any financing statement or continuation statement filed in accordance with
paragraph (a) above seriously misleading within the meaning of Section
9-402(7) of the UCC, unless it shall have given the Owner Trustee and the
Indenture Trustee at least five days' prior written notice thereof and shall
have promptly filed appropriate amendments to all previously filed financing
statements or continuation statements.
(c) Each of the Depositor and the Servicer shall have an obligation to
give the Owner Trustee and the Indenture Trustee at least five Business Days'
prior written notice of any relocation of its principal executive office if,
as a result of such relocation, the applicable provisions of the UCC would
require the filing of any amendment of any previously filed financing or
continuation statement or of any new financing statement, and shall promptly
file any such amendment or new financing statement. The Servicer shall at all
times maintain each office from which it shall service Receivables, and its
principal executive office, within the United States of America.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit (i) a person
adequately trained in the use of the Servicer's data system to know at any
time the status of each such Receivable, including payments and recoveries
made and payments owing (and the nature of each) and (ii) reconciliation
between payments or recoveries on or with respect to each such Receivable and
the amounts from time to time deposited in the Collection Account in respect
of each such Receivable.
(e) The Servicer shall maintain its computer systems so that, from and
after the time of sale under this Agreement of the Receivables, the Servicer's
master computer records (including any backup archives) that refer to a
Receivable shall be coded to reflect that such Receivable is part of the
portfolio of Receivables that is the subject of this Agreement and is held by
the Indenture Trustee for BMW Vehicle Owner Trust 1999-A. Indication of such
Receivable's inclusion in the portfolio shall be deleted from or modified on
the Servicer's computer systems when, and only when, the related Receivable
shall have been paid in full or repurchased.
(f) If at any time the Depositor or the Servicer shall propose to sell,
grant a security interest in or otherwise transfer any interest in motor
vehicle receivables to any prospective purchaser, lender or other transferee,
the Servicer shall give to such prospective purchaser, lender or other
transferee computer tapes, records or printouts (including any restored from
backup archives) that, if they shall refer in any manner whatsoever to any
Receivable, shall indicate clearly that such Receivable has been sold and is
owned by the Issuer and has been pledged to the Indenture Trustee.
(g) The Servicer shall permit the Indenture Trustee and its agents upon
reasonable notice and at any time during normal business hours, which does not
unreasonably interfere with the Servicer's normal operations or customer or
employee relations, to inspect, audit and make copies of and abstracts from
the Servicer's records regarding any Receivable.
(h) Upon request, the Servicer shall furnish to the Owner Trustee or the
Indenture Trustee, within fifteen Business Days, a list of all Receivables (by
contract number and name of Obligor) then held as part of the Trust, together
with a reconciliation of such list to the Schedule of Receivables and to each
of the Servicer's Certificates furnished prior to such request indicating
removal of Receivables from the Trust.
(i) The Servicer shall deliver to the Owner Trustee and the Indenture
Trustee: promptly after the execution and delivery of this Agreement and each
amendment hereto and in connection with the transfer of Subsequent Receivables
from the Depositor to the Trust, an Opinion of Counsel stating that, in the
opinion of such counsel, either (i) all financing statements and continuation
statements have been executed and filed that are necessary to fully preserve
and protect the interest of the Trust and the Indenture Trustee in the
Receivables, and reciting the details of such filings or referring to prior
Opinions of Counsel in which such details are given, or (ii) no such action
shall be necessary to preserve and protect such interest.
Each Opinion of Counsel referred to in clause (i) or (ii) above shall
specify any action necessary (as of the date of such opinion) to be taken in
the following year to preserve and protect such interest.
Section 10.03. Notices. All demands, notices, communications and
instructions upon or to the Depositor, the Servicer, the Issuer, the Owner
Trustee, the Indenture Trustee or any Rating Agency under this Agreement shall
be in writing, personally delivered, faxed and followed by first class 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 Depositor, to Seven
World Trade Center, New York, New York 10048, Attention: SSB Vehicle
Securities Inc.; (b) in the case of the Servicer, Administrator and Custodian,
to BMW FS, 300 Chestnut Ridge Road, Woodcliff Lake, New Jersey 07675,
Attention: Vice President Finance and Risk, (c) in the case of the Indenture
Trustee, to 450 West 33rd Street, 14th Floor, New York, New York 10001,
Attention: Capital Markets Fiduciary Services, Attention: BMW Vehicle Owner
Trust 1999-A; (d) in the case of the Issuer or the Owner Trustee, at the
Corporate Trust Administration Department (as defined in the Trust Agreement);
(e) in the case of Moody's, to 99 Church Street, New York, New York 10007,
Attention: ABS Monitoring Department, and (g) in the case of Standard &
Poor's, to 55 Water Street (40th Floor), New York, New York 10041, Attention:
Asset Backed Surveillance Department; or, as to each of the foregoing, at such
other address as shall be designated by written notice to the other parties.
Section 10.04. Assignment by the Depositor or the Servicer.
Notwithstanding anything to the contrary contained herein, except as provided
in Sections 6.04 and 7.03 herein and as provided in the provisions of this
Agreement concerning the resignation of the Servicer, this Agreement may not
be assigned by the Depositor or the Servicer.
Section 10.05. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Depositor, the Servicer, the
Seller, the Issuer, the Owner Trustee, the Certificateholders, 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 Trust Estate or under or in respect of this
Agreement or any covenants, conditions or provisions contained herein.
Section 10.06. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
Section 10.07. Counterparts. This Agreement may be executed by the
parties hereto in any number of counterparts, each of which when so executed
and delivered shall be an original, but all of which shall together constitute
but one and the same instrument.
Section 10.08. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
Section 10.09. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
Section 10.10. Assignment by Issuer. The Depositor hereby acknowledges
and consents to any mortgage, pledge, assignment and grant of a security
interest by the Issuer to the Indenture Trustee pursuant to the Indenture for
the benefit of the Noteholders of all right, title and interest of the Issuer
in, to and under the Receivables or the assignment of any or all of the
Issuer's rights and obligations hereunder to the Indenture Trustee.
Section 10.11. Nonpetition Covenants. Notwithstanding any prior
termination of this Agreement, the parties hereto shall not, prior to the date
that is one year and one day after the termination of this Agreement with
respect to the Issuer or the Depositor, acquiesce, petition or otherwise
invoke or cause the Issuer or the Depositor to invoke the process of any court
or government authority for the purpose of commencing or sustaining a case
against the Issuer or the Depositor under any federal or state bankruptcy,
insolvency or similar law, or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Issuer or
the Depositor or any substantial part of its property, or ordering the winding
up or liquidation of the affairs of the Issuer or the Depositor.
Section 10.12. Limitation of Liability of Owner Trustee and Indenture
Trustee.
(a) Notwithstanding anything contained herein to the contrary, this
Agreement has been countersigned by Wilmington Trust Company not in its
individual capacity but solely in its capacity as Owner Trustee of the Issuer
and in no event shall Wilmington Trust Company in its individual capacity or,
except as expressly provided in the Trust Agreement, as Owner Trustee of the
Issuer 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 in accordance
with the priorities set forth herein. For all purposes of this Agreement, in
the performance of its duties or obligations hereunder or in the performance
of any duties or obligations of the Issuer hereunder, the Owner Trustee shall
be subject to, and entitled to the benefits of, the terms and provisions of
Articles VI, VII and VIII of the Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been accepted by The Chase Manhattan Bank, not in its individual
capacity but solely as Indenture Trustee, and in no event shall The Chase
Manhattan Bank have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any
of the certificates, notices or agreements delivered pursuant hereto, as to
all of which recourse shall be had solely to the assets of the Issuer in
accordance with the priorities set forth herein.
Section 10.13. Depositor Payment Obligation. The Depositor shall be
responsible for the payment of all fees and expenses of the Trust, the Owner
Trustee and the Indenture Trustee paid by any of them in connection with any
of their obligations under the Basic Documents to obtain or maintain or
monitor the renewal of any required license of the Trust under the
Pennsylvania Motor Vehicle Sales Finance Act.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers as of the day and year first above
written.
BMW VEHICLE OWNER TRUST 1999-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By: ___________________________________
Name:
Title
SSB VEHICLE SECURITIES INC.
By: ___________________________________
Name:
Title
BMW FS FUNDING CORPORATION
By: ___________________________________
Name:
Title
By: ___________________________________
Name:
Title
BMW FINANCIAL SERVICES NA, INC.
By: ___________________________________
Name:
Title
By: ___________________________________
Name:
Title
THE CHASE MANHATTAN BANK
By: ___________________________________
Name:
Title
<PAGE>
SCHEDULE A
Schedule of Receivables
-----------------------
[To be Delivered to the Indenture Trustee at Closing]
<PAGE>
SCHEDULE B
Location of Receivable Files
----------------------------
BMW Financial Services NA, Inc.
5515 Park Center Circle
Dublin, Ohio 43017
<PAGE>
EXHIBIT A
Representations and Warranties of the Sellers
---------------------------------------------
Under Section 3.02 of the Receivables Purchase Agreement
--------------------------------------------------------
<PAGE>
EXHIBIT B
Form of Distribution Date Statement to Securityholders
<TABLE>
<CAPTION>
BMW Financial Services NA, Inc.
BMW Vehicle Owner Trust 1999-A Distribution Date Statement to Securityholders
Principal Distribution Amount
- -----------------------------------------------------------------------------------------------------
<S> <C>
Class A-1 Notes: ($ per $1,000 original principal balance)
Class A-2 Notes: ($ per $1,000 original principal balance)
Class A-3 Notes: ($ per $1,000 original principal balance)
Class A-4 Notes: ($ per $1,000 original principal balance)
Interest Distribution Amount
Class A-1 Notes: ($ per $1,000 original principal balance)
Class A-2 Notes: ($ per $1,000 original principal balance)
Class A-3 Notes: ($ per $1,000 original principal balance)
Class A-4 Notes: ($ per $1,000 original principal balance)
</TABLE>
Principal Distribution Amount
Principal Per $1,000 Certificate
Interest Distribution Amount
Interest Per $1,000 Certificate
Class A-1 Interest Carryover Shortfall
Class A-2 Interest Carryover Shortfall
Class A-3 Interest Carryover Shortfall
Class A-4 Interest Carryover Shortfall
Certificateholders' Interest Carryover Shortfall
Distribution Date Payment Shortfall
Reserve Account Withdrawal Shortfall
Note Balance:
Class A-1 Notes:
Class A-2 Notes:
Class A-3 Notes:
Class A-4 Notes:
Note Pool Factor:
Class A-1 Notes:
Class A-2 Notes:
Class A-3 Notes:
Class A-4 Notes:
Certificate Balance
Certificate Pool Factor
Servicing Fee
Owner Trustee Fee
Indenture Trustee Fee
Pool Balance
Realized Losses
Liquidated Receivables or Purchased Receivables
Purchase Amounts
Reserve Account Balance
Amount Deposited to Reserve Account
Certificate Interest Reserve Account Balance
Principal Balance of Receivables that were delinquent:
30 to 59 days
60 to 89 days
90 days or more
Amount Withdrawn from Reserve Account
Amount Withdrawn from the Certificate Interest Reserve Account
Pre-Funding Account Balance
Certificate Interest Reserve Account
Capitalized Interest Account Balance
Mandatory Redemption Amount
Class A-1 Notes
Class A-2 Notes
Class A-3 Notes
Class A-4 Notes
<PAGE>
EXHIBIT C
Form of Servicer's Certificate
------------------------------
[TO BE ADDED]
<PAGE>
EXHIBIT D
FORM OF DEALER AGREEMENT
<PAGE>
EXHIBIT E
Form of Subsequent Transfer Agreement
-------------------------------------
SUBSEQUENT TRANSFER AGREEMENT
SUBSEQUENT TRANSFER AGREEMENT (the "Agreement") dated as of
________, by and among SSB Vehicle Securities Inc., a Delaware corporation
("SSB"), BMW Vehicle Owner Trust 1999-A, a Delaware business trust (the
"Trust"), BMW Financial Services NA, Inc., a Delaware corporation ("BMW FS"),
and The Chase Manhattan Bank, a New York banking corporation, as indenture
trustee under the Indenture (the "Indenture Trustee").
Reference is hereby made to the Sale and Servicing Agreement (the "Sale
and Servicing Agreement") dated as of September 1, 1999, among SSB, The Chase
Manhattan Bank, the Trust, BMW Funding and BMW FS, and the Receivables
Purchase Agreement (the "Purchase Agreement") dated as of September 1, 1999,
among BMW Funding Corporation, BMW FS and SSB.
WHEREAS, SSB wishes to sell the Subsequent Receivables set forth in
Schedule A hereto to the Trust, and the Trust wishes to purchase such
Subsequent Receivables and to pledge such Subsequent Receivables to the
Indenture Trustee, all in accordance with the provisions of the Sale and
Servicing Agreement and the Indenture;
NOW, THEREFORE, BMW FS, SSB, the Trust and the Indenture Trustee hereby
agree as follows:
Definitions. Capitalized terms used herein and not otherwise defined
herein shall the meanings ascribed to them in the Sale and Servicing
Agreement.
Subsequent Receivables. Schedule A attached hereto sets forth the
Subsequent Receivables being transferred hereby by SSB to the Trust having an
aggregate principal balance of $_________ as of _______ (the "Subsequent
Cutoff Date").
Transfer of Subsequent Receivables to the Trust. Pursuant to and upon the
representations, warranties and agreements on the part of BMW FS and SSB in
the Subsequent Purchase Agreement and the Sale and Servicing Agreement and the
Receivables Purchase Agreement and in consideration of the purchase price of
$_________, SSB does hereby sell, assign, transfer and otherwise convey unto
the Trust, without recourse (except as expressly provided in the Sale and
Servicing Agreement), all right, title and interest of SSB in and to: (1) the
Subsequent Receivables and all moneys received thereon on or after the
Subsequent Cutoff Date listed on Schedule A to this Agreement; (2) the
security interests in the Financed Vehicles and any accessions thereto granted
by Obligors pursuant to the Subsequent Receivables and any other interest of
the Depositor in such Financed Vehicles; (3) any Liquidation Proceeds and any
other proceeds with respect to the Subsequent Receivables from claims on any
physical damage, credit life or disability insurance policies covering the
Financed Vehicles or the related Obligors, including any vendor's single
interest or other collateral protection insurance policy; (4) any property
that shall have secured a Subsequent Receivable and shall have been acquired
by or on behalf of the SSB, the Servicer or the Trust; (5) all documents and
other items contained in the Receivable Files; (6) all of SSB's rights (but
not its obligations) under the Subsequent Purchase Agreement; (7) all right,
title and interest in all funds on deposit from time to time in the Trust
Accounts, the Certificate Interest Reserve Account and the Certificate
Distribution Account and in all investments therein and proceeds thereof
(including all Investment Earnings thereon); (8) any proceeds from any
Subsequent Receivable repurchased by a Dealer pursuant to a Dealer Agreement;
and (9) the proceeds of any and all of the foregoing. The foregoing sale does
not constitute and is not intended to result in any assumption by the Trust of
any obligation of either SSB or BMW FS to the Obligors, insurers or any other
person in connection with the Subsequent Receivables, Receivable Files, any
insurance policies or any agreement or instrument relating to any of them.
Withdrawal from the Pre-Funding Account. Pursuant to Section ____ of the
Sale and Servicing Agreement, the Indenture Trustee is hereby directed to (i)
withdraw $________ from the Pre-Funding Account representing the Principal
Balance of the Subsequent Receivables transferred to the Issuer on such
Subsequent Transfer Date less the Reserve Account Subsequent Deposit Amount
for such Subsequent Transfer Date and distribute such amount to or upon the
order of the Depositor and (ii) withdraw $_________ from the Pre-Funding
Account representing the Reserve Account Subsequent Deposit Amount for such
Subsequent Transfer Date and, on behalf of the Depositor, to deposit such
amount in the Reserve Account.
Representations of BMW FS.
(a) BMW FS hereby consents to the assignment by SSB to the Trust of SSB's
rights with respect to the representations and warranties made by BMW FS in
the Purchase Agreement and the Subsequent Purchase Agreement with regard to
the Subsequent Receivables and BMW FS. Such representations and warranties
speak as of the execution and delivery of this Agreement, but shall survive
the delivery of the Subsequent Receivables to the Indenture Trustee or the
Custodian. Pursuant to this Agreement, SSB has sold, assigned, transferred and
conveyed to the Trust its rights under the Purchase Agreement, including its
rights with respect to the representations and warranties of BMW FS, upon
which the Trust relies in accepting the Subsequent Receivables.
(b) BMW FS hereby agrees that the Issuer on behalf of the Trust shall
have the right to enforce any and all rights under the Purchase Agreement and
the Subsequent Purchase Agreement assigned herein to such party, including the
right to cause BMW FS to repurchase any Subsequent Receivable with respect to
which it is in breach of any of its representations and warranties, directly
against BMW FS as though the Issuer or the Trust was a party to the Purchase
Agreement and the Subsequent Purchase Agreement, and the Issuer shall not be
obligated to exercise any such rights indirectly through SSB.
Representations of SSB. SSB represents and warrants to the Trust that the
representations and warranties of SSB in the Sale and Servicing Agreement with
respect to the Subsequent Receivables and SSB are true and correct as of the
date of this Agreement and hereby certifies that:
(c) the minimum APR for the Subsequent Receivables is 8.00%;
(d) after the inclusion of the Subsequent Receivables, the weighted
average number of months since the initial installment due date for the
Receivables is at least 9 months;
(e) after the inclusion of the Subsequent Receivable, at least 50% of the
aggregate principal balance of the Receivables is secured by Financed Vehicles
which were new at the date of origination;
(f) no Subsequent Receivable will be an Owners Choice Receivable; and
(g) All other conditions precedent set forth in Section 2.01(b) of the
Sale and Servicing Agreement relating to the conveyance of Subsequent
Receivables to the Trust have been satisfied.
Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Separate Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same instrument.
Headings. The headings of the various Sections herein are for convenience
of reference only and shall not define or limit any of the terms or provisions
hereof.
GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Limitation of Liabilities. It is expressly understood and agreed by the
parties hereto that (a) this Subsequent Transfer Agreement is executed and
delivered by Wilmington Trust Company, not individually or personally but
solely as Owner Trustee of BMW Vehicle Owner Trust 1999-A, in the exercise of
the powers and authority conferred and vested in it, (b) each of the
representations, undertakings and agreements herein made on the part of the
Issuer is made and intended not as personal representations, undertakings and
agreements by Wilmington Trust Company but is made and intended for the
purpose for binding only the Issuer, (c) nothing herein contained shall be
construed as creating any liability on Wilmington Trust Company, individually
or personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties
hereto and by any Person claiming by, through or under the parties hereto and
(d) under no circumstances shall Wilmington Trust Company be personally liable
for the payment of any indebtedness or expenses of the Issuer or be liable for
the breach or failure of any obligation, representation, warranty or covenant
made or undertaken by the Issuer under this Subsequent Trust Agreement or any
other related documents.
Ratification of Agreement. As supplemented by this Agreement, the Sale
and Servicing Agreement is in all respects ratified and confirmed and the Sale
and Servicing Agreement as so supplemented by this Agreement shall be read,
taken and construed as one and the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Subsequent
Transfer Agreement to be duly executed by their respective officers as of the
day and year first above written.
BMW VEHICLE OWNER TRUST 1999-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By:_______________________________
Name:
Title:
SSB VEHICLE SECURITIES INC.
By:_______________________________
Name:
Title:
BMW FINANCIAL SERVICES NA, INC.
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
THE CHASE MANHATTAN BANK,
as Indenture Trustee
By:______________________________
Name:
Title:
<PAGE>
SCHEDULE A TO
SUBSEQUENT TRANSFER AGREEMENT NO. ___
Schedule of Subsequent Receivables
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