<PAGE> 1
EXHIBIT 4.2
ASSOCIATES AUTOMOBILE RECEIVABLES TRUST 2000-1
6.854% Class A-1 Automobile Receivables-Backed Notes
7.15% Class A-2 Automobile Receivables-Backed Notes
7.30% Class A-3 Automobile Receivables-Backed Notes
7.51% Class M Automobile Receivables-Backed Notes
7.83% Class B Automobile Receivables-Backed Notes
INDENTURE
Dated as of June 1, 2000
BANK ONE, NATIONAL ASSOCIATION
Trustee
<PAGE> 2
CROSS REFERENCE TABLE
<TABLE>
<CAPTION>
TIA Indenture
---------
Section Section
------- ---------
<S> <C>
310(a)(1)........................................................................................ 6.11
(a)(2)........................................................................................ 6.11
(a)(3)........................................................................................ 6.10
(a)(4)........................................................................................ N.A.(2)
(a)(5)........................................................................................ 6.11
(b)........................................................................................ 6.08; 6.11
(c)........................................................................................ N.A.
311(a) ........................................................................................ 6.12
(b)........................................................................................ 6.12
(c)........................................................................................ N.A.
312(a) ........................................................................................ 7.01
(b)........................................................................................ 7.02
(c)........................................................................................ 7.02
313(a) ........................................................................................ 7.04
(b)(1)........................................................................................ 7.04
(b)(2)........................................................................................ 7.04
(c)........................................................................................ 11.05
(d)........................................................................................ 7.04
314(a) ........................................................................................ 7.03
(b)........................................................................................ 3.06; 11.15
(c)(1)........................................................................................ 11.01
(c)(2)........................................................................................ 11.01
(c)(3)........................................................................................ 11.01
(d)........................................................................................ 11.01
(e)........................................................................................ 11.01
(f)........................................................................................ 11.01
315(a) ........................................................................................ 6.01
(b)........................................................................................ 6.05; 11.05
(c)........................................................................................ 6.01
(d)........................................................................................ 6.01
(e)........................................................................................ 5.14
316(a)(last sentence)............................................................................ 1.01
(a)(1)(A)........................................................................................ 5.12
(a)(1)(B)........................................................................................ 5.13
(a)(2)........................................................................................ N.A.
(b)........................................................................................ 5.08
(c)........................................................................................ N.A.
317(a)(1)........................................................................................ 5.03
(a)(2)........................................................................................ 5.03
(b)........................................................................................ 3.03
318(a) ........................................................................................ 11.07
</TABLE>
1 Note: This Cross Reference Table shall not, for any purpose, be deemed
to be part of this Indenture.
2 N.A. means Not Applicable.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE.....................................2
SECTION 1.01. Definitions...........................................................2
SECTION 1.02. Incorporation by Reference of Trust Indenture Act....................11
SECTION 1.03. Rules of Construction................................................11
ARTICLE II THE NOTES.....................................................................12
SECTION 2.01. Form.................................................................12
SECTION 2.02. Execution, Authentication and Delivery...............................12
SECTION 2.03. Temporary Notes......................................................13
SECTION 2.04. Registration; Registration of Transfer and Exchange..................13
SECTION 2.05. Mutilated, Destroyed, Lost or Stolen Notes...........................15
SECTION 2.06. Person Deemed Owner..................................................16
SECTION 2.07. Payment of Principal and Interest....................................16
SECTION 2.08. Cancellation.........................................................17
SECTION 2.09. Book-Entry Notes.....................................................17
SECTION 2.10. Notices to Depository................................................18
SECTION 2.11. Definitive Notes.....................................................18
ARTICLE III COVENANTS.....................................................................18
SECTION 3.01. Payment of Principal and Interest....................................18
SECTION 3.02. Maintenance of Office or Agency......................................19
SECTION 3.03. Money for Payments To Be Held in Trust...............................19
SECTION 3.04. Existence............................................................20
SECTION 3.05. Protection of Trust Estate...........................................21
SECTION 3.06. Opinions as to Trust Estate..........................................21
SECTION 3.07. Performance of Obligations; Servicing of Receivables.................22
SECTION 3.08. Negative Covenants...................................................24
SECTION 3.09. Annual Statement as to Compliance....................................25
SECTION 3.10. Issuer May Consolidate, etc. Only on Certain Terms...................25
SECTION 3.11. Successor or Transferee..............................................27
SECTION 3.12. No Other Business....................................................28
SECTION 3.13. No Borrowing.........................................................28
SECTION 3.14. Servicer's Obligations...............................................28
SECTION 3.15. Guarantees, Loans, Advances and Other Liabilities....................28
SECTION 3.16. Capital Expenditures.................................................28
SECTION 3.17. Restricted Payments..................................................28
SECTION 3.18. Notice of Events of Default..........................................29
</TABLE>
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<TABLE>
<S> <C>
SECTION 3.19. Further Instruments and Acts.........................................29
SECTION 3.20. Compliance with Laws.................................................29
SECTION 3.21. Amendments of Sale and Servicing Agreement and
Trust Agreement......................................................29
SECTION 3.22. Removal of Administrator.............................................29
SECTION 3.23. Income Tax Characterization..........................................29
ARTICLE IV SATISFACTION AND DISCHARGE....................................................29
SECTION 4.01. Satisfaction and Discharge of Indenture..............................29
SECTION 4.02. Application of Trust Money...........................................31
SECTION 4.03. Repayment of Moneys Held by Paying Agent.............................31
SECTION 4.04. Release of Trust Estate..............................................31
ARTICLE V REMEDIES......................................................................31
SECTION 5.01. Events of Default....................................................31
SECTION 5.02. Rights upon Event of Default.........................................33
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement
by Trustee; Authority of Trustee.....................................33
SECTION 5.04. Remedies.............................................................36
SECTION 5.05. Optional Preservation of the Receivables.............................37
SECTION 5.06. Priorities...........................................................38
SECTION 5.07. Limitation of Suits..................................................40
SECTION 5.08. Unconditional Rights of Noteholders To Receive Principal
and Interest.........................................................41
SECTION 5.09. Restoration of Rights and Remedies...................................41
SECTION 5.10. Rights and Remedies Cumulative.......................................41
SECTION 5.11. Delay or Omission Not a Waiver.......................................42
SECTION 5.12. Control by Controlling Noteholders...................................42
SECTION 5.13 Waiver of Past Defaults..............................................42
SECTION 5.14. Undertaking for Costs................................................43
SECTION 5.15. Waiver of Stay or Extension Laws.....................................43
SECTION 5.16. Action on Notes......................................................43
SECTION 5.17. Performance and Enforcement of Certain Obligations...................43
ARTICLE VI THE TRUSTEE...................................................................45
SECTION 6.01. Duties of Trustee....................................................45
SECTION 6.02. Rights of Trustee....................................................47
SECTION 6.03. Individual Rights of Trustee.........................................48
SECTION 6.04. Trustee's Disclaimer.................................................49
SECTION 6.05. Notice of Defaults...................................................49
SECTION 6.06. Reports by Trustee to Holders........................................49
SECTION 6.07. Compensation and Indemnity...........................................49
</TABLE>
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<TABLE>
<S> <C>
SECTION 6.08. Replacement of Trustee...............................................50
SECTION 6.09. Successor Trustee by Merger..........................................51
SECTION 6.10. Appointment of Co-Trustee or Separate Trustee........................51
SECTION 6.11. Eligibility; Disqualification........................................53
SECTION 6.12. Preferential Collection of Claims Against Issuer.....................53
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS................................................53
SECTION 7.01. Issuer To Furnish Trustee Names and Addresses to
Noteholders..........................................................53
SECTION 7.02. Preservation of Information; Communications to Noteholders...........53
SECTION 7.03. Reports by Issuer....................................................54
SECTION 7.04. Reports by Trustee...................................................54
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES..........................................55
SECTION 8.01. Collection of Money..................................................55
SECTION 8.02. Trust Accounts.......................................................55
SECTION 8.03. General Provisions Regarding Accounts................................56
ARTICLE IX SUPPLEMENTAL INDENTURES.......................................................57
SECTION 9.01. Supplemental Indentures Without Consent of Noteholders...............57
SECTION 9.02. Supplemental Indentures With Consent of Noteholders..................58
SECTION 9.03. Execution of Supplemental Indentures.................................60
SECTION 9.04. Effect of Supplemental Indenture.....................................60
SECTION 9.05. Conformity With Trust Indenture Act..................................60
SECTION 9.06. Reference in Notes to Supplemental Indentures........................60
ARTICLE X REDEMPTION OF NOTES...........................................................61
SECTION 10.01. Redemption. ........................................................61
SECTION 10.02. Form of Redemption Notice............................................61
SECTION 10.03. Notes Payable on Redemption Date.....................................62
ARTICLE XI MISCELLANEOUS.................................................................62
SECTION 11.01. Compliance Certificates and Opinions, etc............................62
SECTION 11.02. Form of Documents Delivered to Trustee...............................64
SECTION 11.03. Acts of Noteholders..................................................65
SECTION 11.04. Notices, etc., to Trustee, Issuer and Rating Agencies................65
SECTION 11.05 Notices to Noteholders; Waiver.......................................66
SECTION 11.06. Alternate Payment and Notice Provisions..............................66
SECTION 11.07. Conflict with Trust Indenture Act....................................67
SECTION 11.08. Effect of Headings and Table of Contents.............................67
</TABLE>
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<TABLE>
<S> <C>
SECTION 11.09. Successors and Assigns...............................................67
SECTION 11.10. Severability.........................................................67
SECTION 11.11. Benefits of Indenture................................................67
SECTION 11.12. Legal Holidays.......................................................67
SECTION 11.13. Governing Law........................................................67
SECTION 11.14. Counterparts.........................................................68
SECTION 11.15. Recording of Indenture...............................................68
SECTION 11.16. Trust Obligation.....................................................68
SECTION 11.17. No Petition..........................................................68
SECTION 11.18. Inspection...........................................................68
SECTION 11.19. Limitation of Liability..............................................69
SECTION 11.20. No Substantive Review of Compliance Documents........................69
</TABLE>
<TABLE>
<S> <C> <C>
Exhibit A -- Schedule of Receivables
Exhibit B -- Form of Depository Agreement
Exhibit C-1 -- Form of Class A-1 Note
Exhibit C-2 -- Form of Class A-2 Note
Exhibit C-3 -- Form of Class A-3 Note
Exhibit C-4 -- Form of Class M Note
Exhibit C-5 -- Form of Class B Note
Exhibit D -- Letter Agreement Between AFL and the Trustee
</TABLE>
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<PAGE> 7
INDENTURE, dated as of June 1, 2000, between ASSOCIATES
AUTOMOBILE RECEIVABLES TRUST 2000-1, a Delaware business trust (the "Issuer"),
and BANK ONE, NATIONAL ASSOCIATION, as trustee (the "Trustee") and not in its
individual capacity.
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
6.854% Class A-1 Automobile Receivables-Backed Notes (the "Class A-1 Notes"),
7.15% Class A-2 Automobile Receivables-Backed Notes (the "Class A-2 Notes"),
7.30% Class A-3 Automobile Receivables-Backed Notes (the "Class A-3 Notes"),
7.51% Class M Automobile Receivables-Backed Notes (the "Class M Notes") and
7.83% Class B Automobile Receivables-Backed Notes (the "Class B Notes" and,
together with the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class M Notes, the "Notes"):
As security for the payment and performance by the Issuer of
its obligations under this Indenture and the Notes, the Issuer has agreed to
assign the Collateral (as defined below) as collateral to the Trustee on behalf
of the Noteholders.
GRANTING CLAUSE
The Issuer hereby Grants to the Trustee at the Closing Date,
on behalf of and for the benefit of the Noteholders to secure the performance of
the Secured Obligations, all of the Issuer's right, title and interest now owned
or hereafter acquired in and to (a) the Receivables and all moneys paid or
payable thereon or in respect thereof after the Cutoff Date (including amounts
due on or before the Cutoff Date but received by AFL, the Seller or the Issuer
after the Cutoff Date); (b) an assignment of the security interests of AFL in
the Financed Vehicles; (c) the Insurance Policies and any proceeds from any
Insurance Policies relating to the Receivables, the Obligors or the Financed
Vehicles, including rebates of premiums and all Collateral Insurance relating to
the Receivables; (d) an assignment of the rights of AFL or the Seller against
Dealers with respect to the Receivables under the Dealer Agreements and the
Dealer Assignments, (e) all items contained in the Receivable Files and any and
all other documents that AFL keeps on file in accordance with its customary
procedures relating to the Receivables, the Obligors or the Financed Vehicles,
(f) an assignment of the rights of the Seller under the Purchase Agreement, (g)
property (including the right to receive future Liquidation Proceeds) that
secures a Receivable and that has been acquired by or on behalf of the Trust
pursuant to liquidation of such Receivable, (h) the Trust Accounts and all funds
on deposit therein from time to time, and in all investments and proceeds
thereof (including all income thereon), (i) the Purchase Agreement, including
the right assigned to the Issuer to cause AFL to repurchase Receivables from the
Seller under certain circumstances, (j) the Sale and Servicing Agreement
(including all rights of the Seller under the Purchase Agreement assigned to the
Issuer pursuant to the Sale and Servicing Agreement), and (k) all present and
future claims, demands, causes and choses in action in respect of any or all of
the foregoing and all payments on or under and all proceeds of every kind and
nature whatsoever in respect of any or all of the foregoing, including all
proceeds of the conversion, voluntary or involuntary, into cash or other
<PAGE> 8
liquid property, all cash proceeds, accounts, accounts receivable, notes,
drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, condemnation awards, rights to payment of any and every kind and other
forms of obligations and receivables, instruments and other property which at
any time constitute all or part of or are included in the proceeds of any of the
foregoing (collectively, the "Collateral").
The Trustee on behalf of the Holders of the Notes acknowledges
such Grant. The Trustee on behalf of the Holders of the Notes accepts the trusts
under this Indenture in accordance with the provisions of this Indenture and
agrees to perform its duties required in this Indenture and the Related
Documents to which it is a party in accordance with their terms 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) 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).
"Administrator" has the meaning specified therefor in the
Trust 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 specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Authorized Officer" means, with respect to the Issuer, any
officer or authorized signatory of the Owner Trustee who is authorized to act
for the Owner Trustee in matters relating to the Issuer and who is identified on
the list of Authorized Officers delivered by the Owner Trustee to the Trustee on
the Closing Date (as such list may be modified or supplemented from time to time
thereafter).
"Book-Entry Note" means any Note registered in the name of the
Depository or its nominee, ownership of which is reflected on the books of the
Depository or on the books of a person
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<PAGE> 9
maintaining an account with such Depository (directly or as an indirect
participant in accordance with the rules of such Depository).
"Business Day" means any day other than a Saturday, Sunday,
legal holiday or other day on which commercial banking institutions in Dallas,
Texas; Chicago, Illinois; New York, New York; Wilmington, Delaware or any other
location of any successor Servicer, successor Owner Trustee or successor Trustee
are authorized or obligated by law, executive order or governmental decree to
remain closed.
"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 Interest Rate" means 6.854% per annum (computed on
the basis of actual days elapsed in a year of 360 days).
"Class A-2 Interest Rate" means 7.15% per annum (computed on
the basis of a 360-day year of twelve 30-day months).
"Class A-3 Interest Rate" means 7.30% per annum (computed on
the basis of a 360-day year of twelve 30-day months).
"Class M Interest Rate" means 7.51% per annum (computed on the
basis of a 360-day year of twelve 30-day months).
"Class B Interest Rate" means 7.83% per annum (computed on the
basis of a 360-day year of twelve 30-day months).
"Class A-1 Notes" means the 6.854% Class A-1 Automobile
Receivables-Backed Notes substantially in the form of Exhibit C-1.
"Class A-2 Notes" means the 7.15% Class A-2 Automobile
Receivables-Backed Notes substantially in the form of Exhibit C-2.
"Class A-3 Notes" means the 7.30% Class A-3 Automobile
Receivables-Backed Notes substantially in the form of Exhibit C-3.
"Class M Notes" means the 7.51% Class M Automobile
Receivables-Backed Notes substantially in the form of Exhibit C-4.
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<PAGE> 10
"Class B Notes" means the 7.83% Class B Automobile
Receivables-Backed Notes substantially in the form of Exhibit C-5.
"Closing Date" means June 22, 2000.
"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 Noteholders" means the holders of (i) a majority
in outstanding principal amount of Class A Notes, or (ii) if all of the Class A
Notes have been paid in full, a majority in outstanding principal amount of the
Class M Notes, or (iii) if all of the Class A Notes and Class M Notes have been
paid in full, a majority in outstanding principal amount of the Class B Notes.
"Corporate Trust Office" means the principal office of the
Trustee at which at any particular time its corporate trust business shall be
administered which office at date of the execution of this Agreement is located
at 1 Bank One Plaza, Suite IL1-0126, Chicago, Illinois 60670-0126, Attn: Global
Corporate Trust Services, except that for purposes of Section 3.02 hereof such
office is located at 14 Wall Street, 8th Floor, New York, New York 10005; or at
such other address as the Trustee may designate from time to time by notice to
the Noteholders and the Issuer, or the principal corporate trust office of any
successor Trustee (the address of which the successor Trustee will notify the
Noteholders, the Security Insurer 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 2.09.
"Depository" means the initial Depository, The Depository
Trust Company, the nominee of which is Cede & Co., as the registered Holder of
$207,000,000 in aggregate principal amount of the Class A-1 Notes, $92,000,000
aggregate principal amount of the Class A-2 Notes, $301,000,000 in aggregate
principal amount of the Class A-3 Notes, $64,583,000 in aggregate principal
amount of the Class M Notes and $85,417,000 in aggregate principal amount of the
Class B Notes as of the Closing Date, and any permitted successor depository.
The Depository shall at all times be a "clearing corporation" as defined in
Section 8-102(3) of the New York UCC.
"Depository Agreement" means the agreement among the Issuer,
the Trustee and The Depository Trust Company, as the initial Depository, dated
as of the Closing Date, relating to the Notes substantially in the form of
Exhibit B.
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<PAGE> 11
"Depository Participant" means a broker, dealer, bank or other
financial institution or other Person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.
"Event of Default" has the meaning specified in Section 5.01.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Executive Officer" means, with respect to any corporation,
the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, Executive Vice President, any Vice President, any Responsible
Officer, the Secretary or the Treasurer of such corporation; and with respect to
any partnership, any general partner thereof.
"Grant" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create, and grant a Lien
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to this Indenture. A Grant of the 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 the Person in whose name a Note
is registered on the Note Register.
"Indebtedness" means, with respect to any Person at any time,
(a) indebtedness or liability of such Person for borrowed money whether
evidenced by bonds, debentures, notes or other instruments, or for the deferred
purchase price of property or services (including trade obligations); (b)
obligations of such Person as lessee under leases which should have been or
should be, in accordance with generally accepted accounting principles, recorded
as capital leases; (c) current liabilities of such Person in respect of unfunded
vested benefits under plans covered by Title IV of ERISA; (d) obligations issued
for or liabilities incurred on the account of such Person; (e) obligations or
liabilities of such Person arising under acceptance facilities; (f) obligations
of such Person under any guarantees, endorsements (other than for collection or
deposit in the ordinary course of business) and other contingent obligations to
purchase, to provide funds for payment, to supply funds to invest in any Person
or otherwise to assure a creditor against loss; (g) obligations of such Person
secured by any lien on property or assets of such Person, whether or not the
obligations have been assumed by such Person; or (h) obligations of such Person
under any interest rate or currency exchange agreement.
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<PAGE> 12
"Indenture" means this Indenture as amended or supplemented
from time to time.
"Independent" means, when used with respect to any specified
Person, that the Person (a) is in fact independent of the Issuer, any other
obligor upon the Notes, the Seller 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 Seller 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 Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.01, made by an
Independent appraiser or other expert appointed by an Issuer Order and approved
by the Trustee in the exercise of reasonable care, and such opinion or
certificate shall state that the signer has read the definition of "Independent"
in this Indenture and that the signer is Independent within the meaning thereof.
"Interest Rate" means the Class A-1 Interest Rate, the Class
A-2 Interest Rate, the Class A-3 Interest Rate, the Class M Interest Rate and
the Class B Interest Rate, as applicable.
"Issuer" means the party named as such in this Indenture until
a successor replaces it and, thereafter, means the successor and, for purposes
of any provision contained herein and required by the TIA, each other obligor on
the Notes.
"Issuer Order" and "Issuer Request" means a written order or
request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Trustee.
"Letter Agreement" has the meaning specified in Section 6.07.
"Note" means a Class A-1 Note, Class A-2 Note, Class A-3 Note,
Class M Note or Class B Note, as applicable.
"Note Owner" means, with respect to a Book-Entry Note, the
Person who is the owner of such Book-Entry Note, as reflected on the books of
the Depository, or on the books of a Person maintaining an account with such
Depository (directly as a Depository participant or as an indirect participant,
in each case in accordance with the rules of such Depository) and with respect
to any Definitive Notes, the Holder.
"Note Register" and "Note Registrar" have the respective
meanings specified in Section 2.04.
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<PAGE> 13
"Officer's Certificate" means a certificate signed by any
Authorized Officer of the Issuer, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01, and
delivered to, the Trustee. Unless otherwise specified, any reference in this
Indenture to an Officer's Certificate shall be to an Officer's Certificate of
any Authorized Officer of the Issuer.
"Opinion of Counsel" means one or more written opinions of
counsel who may, except as otherwise expressly provided in this Indenture, be
employees of or counsel to the Issuer and who shall be satisfactory to the
Trustee and which shall comply with any applicable requirements of Section
11.01, and shall be in form and substance satisfactory to the Trustee. Such
Opinion of Counsel shall not be at the expense of the Trustee.
"Outstanding" means, as of the date of determination, all
Notes theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore canceled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in
the necessary amount has been theretofore deposited with the Trustee or
any Paying Agent in trust for the Holders of such Notes (provided,
however, that if such Notes are to be redeemed, notice of such
redemption has been duly given pursuant to this Indenture or provision
therefor, satisfactory to the Trustee, has been made); and
(iii) Notes in exchange for or in lieu of other Notes which
have been authenticated and delivered pursuant to this Indenture unless
proof satisfactory to the Trustee is presented that any such Notes are
held by a bona fide purchaser.
"Outstanding Amount" means the aggregate principal amount of
all Notes, or class of Notes, as applicable, Outstanding at the 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 trustee under the Trust Agreement.
"Paying Agent" shall initially mean the Trustee or, with
respect to any successor to the Trustee, any other Person that meets the
eligibility standards for the Trustee specified in Section 6.11 and is
authorized by the Issuer to make the distributions from the Note Interest
Distribution Account and the Principal Distribution Account, including payment
of principal of or interest on the Notes on behalf of the Issuer.
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<PAGE> 14
"Payment Date" means a Distribution Date.
"Person" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.
"Predecessor Note" means, with respect to any particular Note,
every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purpose of this definition, any
Note authenticated and delivered under Section 2.05 in lieu of a mutilated,
lost, destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.
"Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.
"Rating Agency" means each of Moody's and Standard & Poor's,
so long as such Persons maintain a rating on the Notes; and if either Moody's or
Standard & Poor's no longer maintains a rating on the Notes, such other
nationally recognized statistical rating organization selected by the Seller.
"Rating Agency Condition" means, with respect to any action,
that each Rating Agency shall have been given 10 days' prior notice thereof and
that each of the Rating Agencies shall have notified the Seller, the Servicer,
the Trustee, the Owner Trustee and the Issuer in writing that such action will
not result in a reduction or withdrawal of the then current rating of the Notes.
"Record Date" means, with respect to a Payment Date or
Redemption Date, the close of business on the last Business Day immediately
preceding such Payment Date or Redemption Date.
"Redemption Date" means, with respect to a redemption of the
Notes pursuant to Section 10.01, the Payment 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 principal amount of the
Notes redeemed plus accrued and unpaid interest on the principal amount of each
class of Notes at the respective Interest Rate for each such class of Notes
being so redeemed to but excluding the Redemption Date.
"Registered Holder" means the Person in whose name a Note is
registered on the Note Register on the applicable Record Date.
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<PAGE> 15
"Related Documents" means the Trust Agreement, the Notes, the
Certificates, the Purchase Agreement, the Sale and Servicing Agreement, the
Administration Agreement, the Custodian Agreement, the Lockbox Agreement, the
Depository Agreement, the letter agreement between Associates Corporation of
North America and the underwriters of the Notes and the Underwriting Agreement
among the Seller, AFL and the underwriters of the Notes. The Related Documents
executed by any party are referred to herein as "such party's Related
Documents," "its Related Documents" or by a similar expression.
"Responsible Officer" means, with respect to the Trustee, any
officer assigned to the Corporate Trust Office (or any successor thereto),
including any Vice President, Assistant Vice President, Trust Officer, any
Assistant Secretary, any trust officer or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and having direct responsibility for the administration of
the this Indenture and Related Documents, and any other officer to whom a matter
may be referred arising hereunder. When used with respect to any other Person
that is not an individual, the President, any Vice President or Assistant Vice
President or the Controller of such Person, or any other officer or employee
having similar functions.
"Sale and Servicing Agreement" means the Sale and Servicing
Agreement, dated as of June 1, 2000, among the Issuer, the Seller and the
Servicer.
"Schedule of Receivables" means the listing of the Receivables
set forth in Exhibit A.
"Secured Obligations" means all amounts and obligations which
the Issuer may at any time owe to or on behalf of the Trustee for the benefit of
the Noteholders under this Indenture or the Notes.
"State" means any one of the 50 states of the United States of
America or the District of Columbia.
"Termination Date" means the date on which the Trustee shall
have received payment and performance of all Secured Obligations.
"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 all
proceeds thereof.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939, as amended, as in force on the date hereof, unless otherwise
specifically provided. The term "TIA" shall specifically include any amendments
or revisions to the Trust Indenture Act of 1939 which may be enacted from time
to time.
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<PAGE> 16
"Trustee" means Bank One, National Association, a national
banking association, as Trustee under this Indenture, or any successor Trustee
under this Indenture.
"UCC" means, unless the context otherwise requires, the
Uniform Commercial Code, as in effect in the relevant jurisdiction, as amended
from time to time.
(b) Except as otherwise specified herein or as the context may
otherwise require, the following terms have the respective meanings set forth in
the Sale and Servicing Agreement as in effect on the Closing Date for all
purposes of this Indenture, and the definitions of such terms are equally
applicable both to the singular and plural forms of such terms:
<TABLE>
<CAPTION>
Section of Sale and
Term Servicing Agreement
---- -------------------
<S> <C>
AFL............................................................................... Section 1.1
Aggregate Principal Balance....................................................... Section 1.1
APR............................................................................... Section 1.1
Available Funds................................................................... Section 1.1
Class A-1 Final Scheduled Distribution Date....................................... Section 1.1
Class A-2 Final Scheduled Distribution Date....................................... Section 1.1
Class A-3 Final Scheduled Distribution Date....................................... Section 1.1
Class M Final Scheduled Distribution Date......................................... Section 1.1
Class B Final Scheduled Distribution Date......................................... Section 1.1
Collateral Agent.................................................................. Section 1.1
Collateral Insurance.............................................................. Section 1.1
Collection Account................................................................ Section 1.1
Controlling Noteholders........................................................... Section 1.1
Custodian......................................................................... Section 1.1
Dealer............................................................................ Section 1.1
Dealer Agreement.................................................................. Section 1.1
Dealer Assignment................................................................. Section 1.1
Distribution Date................................................................. Section 1.1
Draw Date......................................................................... Section 1.1
Eligible Account.................................................................. Section 1.1
Eligible Investments.............................................................. Section 1.1
Financed Vehicle.................................................................. Section 1.1
Liquidation Proceeds.............................................................. Section 1.1
Lockbox Bank...................................................................... Section 1.1
Monthly Period.................................................................... Section 1.1
Moody's........................................................................... Section 1.1
</TABLE>
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<PAGE> 17
<TABLE>
<S> <C>
Note Interest Distribution Account................................................ Section 1.1
Obligor........................................................................... Section 1.1
Principal Distribution Account.................................................... Section 1.1
Purchase Agreement................................................................ Section 1.1
Purchased Receivable.............................................................. Section 1.1
Receivable........................................................................ Section 1.1
Reserve Account................................................................... Section 1.1
Seller............................................................................ Section 1.1
Servicer.......................................................................... Section 1.1
Servicer Termination Event........................................................ Section 1.1
Standard & Poor's................................................................. Section 1.1
Trust Accounts.................................................................... Section 1.1
Trust Agreement................................................................... Section 1.1
</TABLE>
SECTION 1.02. Incorporation by Reference of Trust Indenture
Act. Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by Commission
rule have the meaning assigned to them by such definitions.
SECTION 1.03. Rules of Construction. Unless otherwise
specified:
(i) a term has the meaning assigned to it;
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<PAGE> 18
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles as in
effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
(v) words in the singular include the plural and words in the
plural include the singular; and
(vi) references to Sections, Subsections, Schedules and
Exhibits shall refer to such portions of this Indenture.
ARTICLE II
THE NOTES
SECTION 2.01. Form. The Class A-1 Notes, the Class A-2 Notes,
the Class A-3 Notes, the Class M Notes and the Class B Notes in each case
together with the Trustee's certificate of authentication, shall be in
substantially the forms set forth in Exhibits C-1, C-2, C-3, C-4 and C-5,
respectively, with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
officers executing such Notes, as evidenced by their execution of the Notes. Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.
The Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the officers executing such Notes, as
evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication. The
terms of the Notes set forth in Exhibits C-1, C-2, C-3, C-4 and C-5, 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
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<PAGE> 19
them have ceased to hold such offices prior to the authentication and delivery
of such Notes or did not hold such offices at the date of such Notes.
The Trustee shall upon receipt of the Issuer Order
authenticate and deliver Class A-1 Notes for original issue in an aggregate
principal amount of $207,000,000 Class A-2 Notes for original issue in an
aggregate principal amount of $92,000,000, Class A-3 Notes for original issue in
an aggregate principal amount of $301,000,000, Class M Notes for original issue
in an aggregate principal amount of $64,583,000 and Class B Notes for original
issue in an aggregate principal amount of $85,417,000. The aggregate principal
amount of the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, Class M
Notes and Class B Notes outstanding at any time may not exceed that amount
except as provided in Section 2.05.
Each Note shall be dated the date of its authentication. The
Notes shall be issuable as registered Notes in the minimum denomination of
$1,000 and in integral multiples thereof.
No Note shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the 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
permanent Notes, the Issuer may execute, and upon receipt of an Issuer Order the
Trustee shall authenticate and deliver, temporary Notes which are printed,
lithographed, typewritten, mimeographed or otherwise produced, of the tenor of
the permanent Notes in lieu of which they are issued and with such variations
not inconsistent with the terms of this Indenture as the officers executing such
Notes may determine, as evidenced by their execution of such Notes.
If temporary Notes are issued, the Issuer will cause permanent
Notes to be prepared without unreasonable delay. After the preparation of
permanent Notes, the temporary Notes shall be exchangeable for permanent Notes
upon surrender of the temporary Notes at the office or agency of the Issuer to
be maintained as provided in Section 3.02, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Notes, the Issuer shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of permanent Notes of authorized denominations. Until so
exchanged, the temporary Notes shall in all respects be entitled to the same
benefits under this Indenture as permanent Notes.
SECTION 2.04. Registration; Registration of Transfer and
Exchange. The Issuer shall cause to be kept a register (the "Note Register") in
which, subject to such reasonable regulations as it may prescribe, the Issuer
shall provide for the registration of Notes and the registration of transfers of
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<PAGE> 20
Notes. The Trustee shall be "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 Trustee is appointed by the Issuer
as Note Registrar, the Issuer will give the Trustee prompt written notice of the
appointment of such Note Registrar and of the location, and any change in the
location, of the Note Register, and the Trustee shall have the right to inspect
the Note Register at all reasonable times and to obtain copies thereof, and the
Trustee shall have the right to rely upon a certificate executed on behalf of
the Note Registrar by an Executive Officer thereof as to the names and addresses
of the Holders of the Notes and the principal amounts and number of such Notes.
Upon surrender for registration of transfer of any Note at the
office or agency of the Issuer to be maintained as provided in Section 3.02, the
Issuer shall execute, and the Trustee shall authenticate and the Noteholder
shall obtain from the Trustee, in the name of the designated transferee or
transferees, one or more new Notes in any authorized denominations, of a like
aggregate principal amount.
At the option of the Holder, Notes may be exchanged for other
Notes in any authorized denominations, of a like aggregate principal amount,
upon surrender of the Notes to be exchanged at such office or agency. Whenever
any Notes are so surrendered for exchange, the Issuer shall execute, and the
Trustee shall authenticate and the Noteholder shall obtain from the Trustee, the
Notes which the Noteholder making the exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange
of Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of
transfer or exchange shall be duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Trustee duly executed by, the
Holder thereof or such Holder's attorney duly authorized in writing, with such
signature guaranteed by a commercial bank or trust company located, or having a
correspondent located, in The City of New York or the city in which the
Corporate Trust Office is located, or by a member firm of a national securities
exchange, and such other documents as the Trustee may require.
No service charge shall be made to a Holder for any
registration of transfer or exchange of Notes, but the Issuer or the Trustee may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges pursuant to Section 2.03 or 9.06 not
involving any transfer.
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<PAGE> 21
The preceding provisions of this Section 2.04 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.
SECTION 2.05. Mutilated, Destroyed, Lost or Stolen Notes. If
(i) any mutilated Note is surrendered to the Trustee, or the Trustee receives
evidence to its satisfaction of the destruction, loss or theft of any Note, and
(ii) there is delivered to the Trustee such security or indemnity as may be
required by them to hold the Issuer and the Trustee harmless, then, in the
absence of notice to the Issuer, the Note Registrar or the Trustee that such
Note has been acquired by a bona fide purchaser, the Issuer shall execute and
upon its request the Trustee shall authenticate and deliver, in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement
Note; provided, however, that if any such destroyed, lost or stolen Note, but
not a mutilated Note, shall have become or within seven days shall be due and
payable, or shall have been called for redemption, instead of issuing a
replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so
due or payable or upon the Redemption Date without surrender thereof. If, after
the delivery of such replacement Note or payment of a destroyed, lost or stolen
Note pursuant to the proviso to the preceding sentence, a bona fide purchaser of
the original Note in lieu of which such replacement Note was issued presents for
payment such original Note, the Issuer and the Trustee shall be entitled to
recover such replacement Note (or such payment) from the Person to whom it was
delivered or any Person taking such replacement Note from such Person to whom
such replacement Note was delivered or any assignee of such Person, except a
bona fide purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Issuer or the Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section,
the Issuer or the Trustee may require the payment by the Holder of such Note of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other reasonable expenses (including the
fees and expenses of the Trustee or the Note Registrar) connected therewith.
Every replacement Note issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
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<PAGE> 22
SECTION 2.06. Person Deemed Owner. Prior to due presentment
for registration of transfer of any Note, the Issuer, the Trustee and any agent
of the Issuer or the Trustee may treat the Person in whose name any Note is
registered (as of the day of determination) as the owner of such Note for the
purpose of receiving payments of principal of and interest, if any, on such Note
and for all other purposes whatsoever, whether or not such Note be overdue, and
none of the Issuer, the Trustee nor any agent of the Issuer or the Trustee shall
be affected by notice to the contrary.
SECTION 2.07. Payment of Principal and Interest
(a) The Notes shall accrue interest as provided in the forms
of the Class A-1 Note, the Class A-2 Note, the Class A-3 Note, the Class M Note
and the Class B Note set forth in Exhibits C-1, C-2, C-3, C-4 and C-5,
respectively, and such interest shall be payable on each Payment Date as
specified therein, subject to Section 3.01. Any installment of interest or
principal, if any, payable on any Note which is punctually paid or duly provided
for by the Issuer on the applicable Payment Date shall be paid to the Person in
whose name such Note (or one or more Predecessor Notes) is registered on the
Record Date, by check mailed first-class, postage prepaid to such Person's
address as it appears on the Note Register on such Record Date, except that,
unless Definitive Notes have been issued pursuant to Section 2.11, with respect
to Notes registered on the Record Date in the name of the nominee of the
Depository, payment will be made by wire transfer in immediately available funds
to the account designated by such nominee and except for (i) the final
installment of principal payable with respect to such Note on a Payment Date and
(ii) the Redemption Price for any Note called for redemption pursuant to Section
10.01, which shall be payable as provided below. The funds represented by any
such checks returned undelivered shall be held in accordance with Section 3.03.
(b) The principal of each Note shall be payable in
installments on each Payment Date as provided in the forms of the Class A-1
Note, the Class A-2 Note, the Class A-3 Note, the Class M Note and the Class B
Note set forth in Exhibits C-1, C-2, C-3, C-4 and C-5, respectively.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable, if not previously paid, on the date on which an Event
of Default shall have occurred and be continuing if the Trustee or the
Controlling Noteholders have declared the Notes to be immediately due and
payable in the manner described in Section 5.02 hereof. All principal payments
on a class of Notes shall be made pro rata to the Noteholders of such class
entitled thereto. The Trustee shall notify the Person in whose name a Note is
registered at the close of business on the Record Date preceding the Payment
Date for which the Trustee has received notice from the Issuer that the Issuer
expects that the final installment of principal of and interest on such Note
will be paid. Such notice shall be mailed no later than five days prior to such
final Payment Date and shall specify that such final installment will be payable
only upon presentation and surrender of such Note and shall specify the place
where such Note may be presented and surrendered for payment of such
installment. Notices in connection with redemptions of Notes shall be mailed to
Noteholders as provided in Section 10.02.
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<PAGE> 23
SECTION 2.08. Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and shall be promptly
canceled by the Trustee. The Issuer may at any time deliver to the Trustee for
cancellation any Notes previously authenticated and delivered hereunder which
the Issuer may have acquired in any manner whatsoever, and all Notes so
delivered shall be promptly canceled by the Trustee. No Notes shall be
authenticated in lieu of or in exchange for any Notes canceled as provided in
this Section, except as expressly permitted by this Indenture. All canceled
Notes may be held or disposed of by the Trustee in accordance with its standard
retention or disposal policy as in effect at the time unless the Issuer shall
direct by an Issuer Order that they be destroyed or returned to it, provided
that such Issuer Order is timely and the Notes have not been previously disposed
of by the Trustee.
SECTION 2.09. Book-Entry Notes. The Notes, upon original
issuance, will be issued in the form of a typewritten Note or Notes representing
the Book-Entry Notes, to be delivered to The Depository Trust Company, the
initial Depository, by, or on behalf of, the Issuer. Such Note shall initially
be registered on the Note Register in the name of Cede & Co., the nominee of the
initial Depository, and no Note Owner will receive a Definitive Note
representing such Note Owner's interest in such Note, except as provided in
Section 2.11. Unless and until definitive, fully registered Notes (the
"Definitive Notes") have been issued to Note Owners pursuant to Section 2.11:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Note Registrar and the Trustee shall be entitled to
deal with the Depository for all purposes of this Indenture (including
the payment of principal of and interest on the Notes and the giving of
instructions or directions hereunder) as the sole holder of the Notes,
and shall have no obligation to the Note Owners;
(iii) to the extent that the provisions of this Section
conflict with any other provisions of this Indenture, the provisions of
this Section shall control;
(iv) the rights of Note Owners shall be exercised only through
the Depository and shall be limited to those established by law and
agreements between such Note Owners and the Depository and/or the
Depository Participants. Pursuant to the Depository Agreement, unless
and until Definitive Notes are issued pursuant to Section 2.11, the
initial Depository will make book-entry transfers among the Depository
Participants and receive and transmit payments of principal of and
interest on the Notes to such Depository Participants;
(v) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes
evidencing a specified percentage of the Outstanding Amount of the
Notes, the Depository shall be deemed to represent such
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<PAGE> 24
percentage only to the extent that it has received instructions to such
effect from Note Owners and/or Depository Participants owning or
representing, respectively, such required percentage of the beneficial
interest in the Notes and has delivered such instructions to the
Trustee; and
(vi) Note Owners may receive copies of any reports sent to
Noteholders pursuant to this Indenture, upon written request, together
with a certification that they are Note Owners and payment of
reproduction and postage expenses associated with the distribution of
such reports, from the Trustee at the Corporate Trust Office.
SECTION 2.10. Notices to Depository. Whenever a notice or
other communication to the Noteholders is required under this Indenture, unless
and until Definitive Notes shall have been issued to Note Owners pursuant to
Section 2.11, the Trustee shall give all such notices and communications
specified herein to be given to Holders of the Notes to the Depository and shall
have no obligation to the Note Owners.
SECTION 2.11. Definitive Notes. If (i) the Administrator
advises the Trustee in writing that the Depository is no longer willing or able
properly to discharge its responsibilities with respect to the Notes, and the
Administrator is unable to locate a qualified successor, (ii) the Administrator
at its option advises the Trustee in writing that it elects to terminate the
book-entry system through the Depository or (iii) after the occurrence of an
Event of Default, the Controlling Noteholders advise the Depository in writing
that the continuation of a book-entry system through the Depository is no longer
in the best interests of the Note Owners, then the Depository shall notify all
Note Owners and the Trustee of the occurrence of any such event and of the
availability of Definitive Notes to Note Owners requesting the same. Upon
surrender to the Trustee of the Note or Notes representing the Book-Entry Notes
by the Depository, accompanied by registration instructions, the Issuer shall
execute and the Trustee shall authenticate the Definitive Notes in accordance
with the instructions of the Depository. None of the Issuer, the Note Registrar
or the Trustee shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Notes, the Trustee shall recognize
the Holders of the Definitive Notes as Noteholders.
ARTICLE III
COVENANTS
SECTION 3.01. Payment of Principal and Interest. The Issuer
will duly and punctually pay the principal and interest, on the Notes in
accordance with the terms of the Notes and this Indenture. Without limiting the
foregoing, the Issuer will cause to be distributed all amounts on deposit in the
Note Interest Distribution Account and the Principal Distribution Account on a
Payment Date in accordance with Sections 8.02(b) and 8.02(c). Amounts properly
withheld under the Code by
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<PAGE> 25
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 City of New York, an office or agency where Notes may be
surrendered for registration of transfer or exchange, and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Issuer hereby initially appoints the Trustee to serve as its agent
for the foregoing purposes. The Issuer will give prompt written notice to the
Trustee of the location, and of any change in the location, of any such office
or agency. If at any time the Issuer shall fail to maintain any such office or
agency or shall fail to furnish the Trustee with the address thereof, such
surrenders, notices and demands may be made or served at the Corporate Trust
Office, and the Issuer hereby appoints the Trustee as its agent to receive all
such surrenders, notices and demands.
SECTION 3.03. Money for Payments To Be Held in Trust. As
provided in Section 8.02, all payments of amounts due and payable with respect
to any Notes that are to be made from amounts withdrawn from the Note Interest
Distribution Account and the Principal Distribution Account pursuant to Sections
8.02(b) and 8.02(c) shall be made on behalf of the Issuer by the Trustee or by
another Paying Agent in accordance with written instructions from the Issuer
upon which the Trustee may rely, and no amounts so withdrawn from the Note
Interest Distribution Account and the Principal Distribution Account for
payments of Notes shall be paid over to the Issuer.
On or before each Payment Date and Redemption Date, the Issuer
shall deposit or cause to be deposited in the Note Interest Distribution Account
and the Principal Distribution Account an aggregate sum sufficient to pay the
amounts then becoming due, such sum to be held in trust for the benefit of the
Persons entitled thereto and (unless the Paying Agent is the Trustee) shall
promptly notify the Trustee in writing of its action or failure so to act.
The Issuer will cause each Paying Agent other than the Trustee
to execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee (and if the Trustee acts as Paying Agent, it hereby
so agrees), subject to the provisions of this Section, that such Paying Agent
will:
(i) hold all sums held by it for the payment of amounts due
with respect to the Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(ii) give the Trustee written notice of any default (of which
it has actual knowledge) by the Issuer (or any other obligor upon the
Notes) in the making of any payment required to be made with respect to
the Notes;
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<PAGE> 26
(iii) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay to
the Trustee all sums held by it in trust for the payment of Notes if at
any time it ceases to meet the standards required to be met by a Paying
Agent at the time of its appointment; and
(v) comply with all requirements of the Code with respect to
the withholding from any payments made by it on any Notes of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Trustee all sums held in trust by
such Paying Agent, such sums to be held by the Trustee upon the same trusts as
those upon which the sums were held by such Paying Agent; and upon such payment
by any Paying Agent to the Trustee, such Paying Agent shall be released from all
further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds,
any money held by the Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Note and remaining unclaimed for two years
after such amount has become due and payable shall be discharged from such trust
and upon Issuer Request shall be deposited by the Trustee in the Collection
Account; and the Holder of such Note shall thereafter, as an unsecured general
creditor, look only to the Issuer for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Issuer cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in The City of New
York, notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to or for the
account of the Issuer. The Trustee may also adopt and employ, at the expense of
the Issuer, any other reasonable means of notification of such repayment
(including, but not limited to, mailing notice of such repayment to Holders
whose Notes have been called but have not been surrendered for redemption or
whose right to or interest in moneys due and payable but not claimed is
determinable from the records of the Trustee or of any Paying Agent, at the last
address of record for each such Holder).
SECTION 3.04. Existence. The Issuer will keep in full effect
its existence, rights and franchises as a 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
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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 intends
the security interest Granted pursuant to this Indenture in favor of the
Noteholders to be prior to all other liens in respect of the Trust Estate, and
the Issuer shall take all actions necessary to obtain and maintain, in favor of
the Trustee, for the benefit of the Noteholders, a first Lien on and a first
priority, perfected security interest in the Trust Estate. The Issuer will from
time to time execute and deliver all such supplements and amendments hereto and
all such financing statements, continuation statements, instruments of further
assurance and other instruments, all as prepared by the Servicer and delivered
to the Issuer, and will take such other action necessary or advisable to:
(i) grant more effectively all or any portion of the Trust
Estate;
(ii) maintain or preserve the Lien and security interest (and
the priority thereof) in favor of the Trustee for the benefit of the
Noteholders created by this Indenture or carry out more effectively the
purposes hereof;
(iii) perfect, publish notice of or protect the validity of
any Grant made or to be made by this Indenture;
(iv) enforce any of the Collateral;
(v) preserve and defend title to the Trust Estate and the
rights of the Trustee in such Trust Estate against the claims of all
persons and parties; or
(vi) pay all taxes or assessments levied or assessed upon the
Trust Estate when due.
The Issuer hereby designates the Trustee its agent and attorney-in-fact to
execute any financing statement, continuation statement or other instrument
required by the Trustee pursuant to this Section; provided, however, that the
Servicer shall be responsible for preparing and filing any such financing
statement, continuation statement or other instrument.
SECTION 3.06. Opinions as to Trust Estate.
(a) On the Closing Date, the Issuer shall furnish to the
Trustee an Opinion of Counsel either stating that, in the opinion of such
counsel, such action has been taken with respect to
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the recording and filing of this Indenture, any indentures supplemental hereto,
and any other requisite documents, and with respect to the execution and filing
of any financing statements and continuation statements, as are necessary to
perfect and make effective the first priority lien and security interest in
favor of the Trustee, for the benefit of the Noteholders, created by this
Indenture and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to make such lien and
security interest effective.
(b) On or before April 30 in each calendar year, beginning in
2001, the Issuer shall furnish to the Trustee an Opinion of Counsel with respect
to each jurisdiction in which a Uniform Commercial Code financing statement has
been filed by the Issuer either stating that, in the opinion of such counsel,
such action has been taken with respect to the recording, filing, re-recording
and refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the execution and filing of any
financing statements and continuation statements as is necessary to maintain the
first priority Lien and security interest created by this Indenture and reciting
the details of such action or stating that in the opinion of such counsel no
such action is necessary to maintain such Lien and security interest. Such
Opinion of Counsel shall also describe the recording, filing, re-recording and
refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and the execution and filing of any financing statements and
continuation statements that will, in the opinion of such counsel, be required
to maintain the Lien and security interest of this Indenture until April 30 in
the following calendar year.
SECTION 3.07. Performance of Obligations; Servicing of
Receivables.
(a) The Issuer will not take any action and will use its best
efforts not to permit any action to be taken by others that would release any
Person from any of such Person's material covenants or obligations under any
instrument or agreement included in the Trust Estate or that would result in the
amendment, hypothecation, subordination, termination or discharge of, or impair
the validity or effectiveness of, any such instrument or agreement, except as
expressly provided in this Indenture, the Sale and Servicing Agreement or such
other instrument or agreement.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the 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. The Owner Trustee shall not be
responsible for the action or inaction of the Servicer or the Administrator.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Related Documents
and in the instruments and agreements included in the Trust Estate, including
but not limited to filing or causing to be filed all UCC financing
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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.
(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 in writing the Trustee and the Rating Agencies thereof,
and shall specify in such notice the action, if any, the Issuer is taking with
respect of such Servicer Termination Event. If a Servicer Termination Event
shall arise from the failure of the Servicer to perform any of its duties or
obligations under the Sale and Servicing Agreement with respect to the
Receivables, the Issuer shall take all reasonable steps available to it to
remedy such failure.
(e) If the Issuer has given notice of termination to the
Servicer of the Servicer's rights and powers pursuant to Section 8.2 of the Sale
and Servicing Agreement, as promptly as possible thereafter, the Issuer shall
appoint a successor servicer in accordance with Section 8.3 of the Sale and
Servicing Agreement.
(f) Upon any termination of the Servicer's rights and powers
pursuant to the Sale and Servicing Agreement, the Issuer shall promptly notify
the Trustee. As soon as a successor Servicer is appointed, the Issuer shall
notify the Trustee of such appointment, specifying in such notice the name and
address of such successor Servicer.
(g) The Issuer agrees that it will not waive timely
performance or observance by the Servicer, the Seller or AFL of their respective
duties under the Related Documents if the effect thereof would adversely affect
the Holders of the Notes.
(h) As promptly as possible after the giving of notice of
termination to the Servicer of the Servicer's rights and powers pursuant to
Section 8.1 of the Sale and Servicing Agreement, the Issuer shall appoint a
successor servicer (the "Successor Servicer"), and such Successor Servicer shall
accept its appointment by a written assumption in a form acceptable to the
Trustee. In the event that a Successor Servicer has not been appointed and
accepted its appointment at the time when the Servicer ceases to act as
Servicer, the Trustee without further action shall automatically be appointed
the Successor Servicer in accordance with Section 8.2 of the Sale and Servicing
Agreement. The Trustee may resign as the Servicer by giving written notice of
such resignation to the Issuer and in such event will be released from such
duties and obligations, such release not to be effective until the date a new
servicer enters into a servicing agreement with the Issuer as provided below.
Upon delivery of any such notice to the Issuer, the Issuer shall obtain a new
servicer as the Successor Servicer under the Sale and Servicing Agreement. Any
Successor Servicer other than the Trustee shall (i) be an Eligible Servicer and
(ii) enter into a servicing agreement with the Issuer having substantially the
same provisions as the provisions of the Sale and Servicing Agreement applicable
to the Servicer. If within 30 days
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after the delivery of the notice referred to above, the Issuer shall not have
obtained such a new servicer, the Trustee may appoint, or may petition a court
of competent jurisdiction to appoint, a Successor Servicer. In connection with
any such appointment, the Trustee may make such arrangements for the
compensation of such successor as it and such successor shall agree, subject to
the limitations set forth below and in the S4ale and Servicing Agreement, and in
accordance with Section 8.2 of the Sale and Servicing Agreement, the Issuer
shall enter into an agreement with such successor for the servicing of the
Receivables (such agreement to be in form and substance satisfactory to the
Trustee). If the Trustee shall succeed to the Servicer's duties as servicer of
the Receivables as provided herein, it shall do so in its individual capacity
and not in its capacity as Trustee and accordingly, the provisions of Article VI
hereof shall be inapplicable to the Trustee in its duties as the successor to
the Servicer and the servicing of the Receivables. In case the Trustee shall
become successor to the Servicer under the Sale and Servicing Agreement, the
Trustee shall be entitled to appoint as Servicer any one of its Affiliates, or
delegate any of its responsibilities as Servicer to any Affiliate or agents,
subject to the terms of the Sale and Servicing Agreement, provided that such
appointment or delegation shall not affect or alter in any way the liability of
the Trustee as successor for the performance of the duties and obligations of
the Servicer in accordance with the terms hereof.
(i) Without derogating from the absolute nature of the
assignment granted to the Trustee under this Indenture or the rights of the
Trustee hereunder, the Issuer agrees that, unless such action is specifically
permitted hereunder or under the Related Documents, it will not, without the
prior written consent of the Trustee or the Controlling Noteholders, amend,
modify, waive, supplement, terminate or surrender, or agree to any amendment,
modification, supplement, termination, waiver or surrender of, the terms of any
Collateral or the Related Documents, or waive timely performance or observance
by the Servicer or the Seller under the Sale and Servicing Agreement; provided,
however, that no such amendment shall (i) 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 (ii) reduce the aforesaid
percentage of the Notes which are required to consent to any such amendment,
without the consent of the Holders of all the Outstanding Notes. If any such
amendment, modification, supplement or waiver shall be so consented to by the
Trustee or such Holders, the Issuer agrees, promptly following a request by the
Trustee to do so, to execute and deliver, in its own name and at its own
expense, such agreements, instruments, consents and other documents as the
Trustee may deem necessary or appropriate in the circumstances.
SECTION 3.08. Negative Covenants. Until the Termination Date,
the Issuer shall not:
(i) except as expressly permitted by this Indenture, the
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 Noteholders;
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(ii) claim any credit on, or make any deduction from the
principal, interest or premium 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 in favor of the Trustee
created by this Indenture to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be released from any
covenants or obligations with respect to the Notes under this Indenture
except as may be expressly permitted hereby, (B) permit any Lien,
charge, excise, claim, security interest, mortgage or other encumbrance
(other than the lien in favor of the Trustee created by this Indenture)
to be created on or extend to or otherwise arise upon or burden the
Trust Estate or any part thereof or any interest therein or the
proceeds thereof (other than tax liens, mechanics' liens and other
liens that arise by operation of law, in each case on a Financed
Vehicle and arising solely as a result of an action or omission of the
related Obligor), (C) permit the Lien in favor of the Trustee created
by this Indenture not to constitute a valid first priority (other than
with respect to any such tax, mechanics' or other lien) security
interest in the Trust Estate, or (D) amend, modify or fail to comply
with the provisions of the Related Documents without the prior written
consent of the Controlling Noteholders.
SECTION 3.09. Annual Statement as to Compliance. The Issuer
will deliver to the Trustee, within 120 days after the end of each fiscal year
of the Issuer (commencing with the fiscal year ending December 31, 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 performance under this Indenture has been made under such
Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's knowledge, based
on such review, the Issuer has complied with all conditions and
covenants under this Indenture throughout such year, or, if there has
been a default in the compliance of any such condition or covenant,
specifying each such default known to such Authorized Officer and the
nature and status thereof.
SECTION 3.10. Issuer May Consolidate, 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
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America or any State and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form and
substance satisfactory to the Trustee, the due and punctual payment of
the principal of and interest on all Notes and the performance or
observance of every agreement and covenant of this Indenture and each
other Related Document on the part of the Issuer to be performed or
observed, all as provided herein;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer, at its own expense, shall have received an
Opinion of Counsel which shall be delivered to and shall be
satisfactory to the Trustee to the effect that such transaction will
not have any material adverse tax consequence to the Trust, or any
Noteholder;
(v) any action as is necessary to maintain the Lien and
security interest created in favor of the Trustee by this Indenture
shall have been taken;
(vi) the Issuer, at its own expense, shall have delivered to
the Trustee an Officer's Certificate and an Opinion of Counsel (which
shall describe the actions taken as required by clause (a)(v) of this
Section 3.10 or that no such actions will be taken) each stating that
such consolidation or merger and such supplemental indenture comply
with this Article III and that all conditions precedent herein provided
for relating to such transaction have been compiled with (including any
filing required by the Exchange Act); and
(vii) the Issuer or the Person (if other than the Issuer)
formed by or surviving such consolidation or merger has a net worth,
immediately after such consolidation or merger, that is (a) greater
than zero and (b) not less than the net worth of the Issuer immediately
prior to giving effect to such consolidation or merger.
(b) The Issuer shall not convey or transfer all or
substantially all of its properties or assets, including those included in the
Trust Estate, to any Person (except as expressly permitted by the Indenture, the
Purchase Agreement or the Sale and Servicing Agreement), unless:
(i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer shall (A) be a United States
citizen or a Person organized and existing under the laws of the United
States of America or any State, (B) expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form and
substance satisfactory to the Trustee, the due and punctual payment of
the principal of and interest on all Notes and
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the performance or observance of every agreement and covenant of this
Indenture and each Related Document on the part of the Issuer to be
performed or observed, all as provided herein, (C) expressly agree by
means of such supplemental indenture that all right, title and interest
so conveyed or transferred shall be subject and subordinate to the
rights of Holders of the Notes, (D) unless otherwise provided in such
supplemental indenture, expressly agree to indemnify, defend and hold
harmless the Issuer against and from any loss, liability or expense
arising under or related to this Indenture and the Notes and (E)
expressly agree by means of such supplemental indenture that such
Person (or if a group of Persons, then one specified Person) shall make
all filings with the Commission (and any other appropriate Person)
required by the Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
which shall be delivered to and shall be satisfactory to the Trustee to
the effect that such transaction will not have any material adverse tax
consequence to the Trust or any Noteholder;
(v) any action as is necessary to maintain the Lien and
security interest created in favor of the Trustee by this Indenture
shall have been taken;
(vi) the Issuer shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel (which shall describe
the actions taken as required by clause (b)(v) of this Section 3.10 or
that no such actions will be taken) each stating that such conveyance
or transfer and such supplemental indenture comply with this Article
III and that all conditions precedent herein provided for relating to
such transaction have been complied with (including any filing required
by the Exchange Act); and
(vii) the Person acquiring by conveyance or transfer the
properties or assets of the Issuer has a net worth, immediately after
such conveyance or transfer, that is (a) greater than zero and (b) not
less than the net worth of the Issuer immediately prior to giving
effect to such conveyance or transfer.
SECTION 3.11. Successor or Transferee.
(a) Upon any consolidation or merger of the Issuer in
accordance with Section 3.10(a), the Person formed by or surviving such
consolidation or merger (if other than the Issuer) shall
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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), Associates Automobile
Receivables Trust 2000-1 will be released from every covenant and agreement of
this Indenture to be observed or performed on the part of the Issuer with
respect to the Notes immediately upon the delivery of written notice to the
Trustee stating that Associates Automobile Receivables Trust 2000-1 is to be so
released.
SECTION 3.12. No Other Business. The Issuer shall not engage
in any business other than financing, purchasing, owning, selling and managing
the Receivables in the manner contemplated by this Indenture and the Related
Documents and activities incidental thereto. After the Closing Date, 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 (i) the Notes and (ii) any other Indebtedness permitted
by or arising under the Related Documents. The proceeds of the Notes shall be
used exclusively to fund the Issuer's purchase of the Receivables and the other
assets specified in the Sale and Servicing Agreement, to fund the Reserve
Account and to pay the Issuer's organizational, transactional and start-up
expenses.
SECTION 3.14. Servicer's Obligations. The Issuer shall cause
the Servicer to comply with Sections 3.9, 3.10, 3.11 and 4.8(a) of the Sale and
Servicing Agreement.
SECTION 3.15. Guarantees, Loans, Advances and Other
Liabilities. Except as contemplated by 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
assuming another's payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, any other interest in, or make any capital
contribution to, any other Person.
SECTION 3.16. 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. Restricted Payments. Except as expressly
permitted by this Indenture or the Sale and Servicing Agreement, the Issuer
shall not, directly or indirectly, (i) make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuer or
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otherwise with respect to any ownership or equity interest or security in or of
the Issuer or to the Servicer, (ii) redeem, purchase, retire or otherwise
acquire for value any such ownership or equity interest or security or (iii) set
aside or otherwise segregate any amounts for any such purpose. The Issuer will
not, directly or indirectly, make payments to or distributions from the
Collection Account except in accordance with this Indenture and the Related
Documents.
SECTION 3.18. Notice of Events of Default. The Issuer agrees
to give the Trustee and the Rating Agencies prompt written notice of each Event
of Default hereunder, each default on the part of the Servicer or the Seller of
its obligations under the Sale and Servicing Agreement and each default on the
part of AFL of its obligations under the Purchase Agreement.
SECTION 3.19. Further Instruments and Acts. Upon request of
the Trustee, the Issuer will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 3.20. Compliance with Laws. The Issuer shall comply
with the requirements of all applicable laws, the non-compliance with which
would, individually or in the aggregate, materially and adversely affect the
ability of the Issuer to perform its obligations under the Notes, this Indenture
or any Related Document.
SECTION 3.21. Amendments of Sale and Servicing Agreement and
Trust Agreement. The Issuer shall not agree to any amendment to Section 10.1 of
the Sale and Servicing Agreement or Section 11.1 of the Trust Agreement to
eliminate the requirements thereunder that the Trustee or the Holders of the
Notes consent to amendments thereto as provided therein.
SECTION 3.22. Removal of Administrator. So long as any Notes
are issued and outstanding, the Issuer shall not remove the Administrator
without cause unless the Rating Agency Condition shall have been satisfied in
connection with such removal.
SECTION 3.23. Income Tax Characterization. For purposes of
federal income, state and local income and franchise and any other income taxes,
the Issuer will treat the Notes as indebtedness.
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
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receive payments of principal, interest and premium, if any, thereon, (iv)
Sections 3.03, 3.04, 3.05, 3.07, 3.08, 3.10, 3.12, 3.13, 3.20, 3.21 and 3.23,
(v) the rights, obligations and immunities of the Trustee hereunder (including
the rights of the Trustee under Section 6.07 and the obligations of the Trustee
under Section 4.02) and (vi) the rights of Noteholders as beneficiaries hereof
with respect to the property so deposited with the Trustee payable to all or any
of them, and the Trustee, on demand of and at the expense of the Issuer, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture with respect to the Notes, when
(A) either
(1) all Notes theretofore authenticated and
delivered, other than (i) Notes that have been destroyed, lost or
stolen and that have been replaced or paid as provided in Section 2.05
and (ii) Notes for whose payment money has theretofore been deposited
in trust or segregated and held in trust by the Issuer and thereafter
repaid to the Issuer or discharged from such trust, as provided in
Section 3.03, have been delivered to the Trustee for cancellation; or
(2) all Notes not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at the
Final Scheduled Distribution Date within one year, or
(iii) are to be called for redemption within
one year under arrangements satisfactory to the Trustee for
the giving of notice of redemption by the Trustee in the name,
and at the expense, of the Issuer,
and the Issuer, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be irrevocably deposited with the
Trustee as part of the Trust Estate cash or direct obligations of or
obligations guaranteed by the United States of America (which will
mature prior to the date such amounts are payable), in trust in an
Eligible Account in the name of the Trustee for such purpose, in an
amount sufficient to pay and discharge the entire indebtedness on such
Notes not theretofore delivered to the Trustee for cancellation when
due on the 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 Secured
Obligations; and
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(C) the Issuer has delivered to the Trustee an Officer's
Certificate, an Opinion of Counsel and (if required by the TIA and the
Trustee an Independent Certificate from a firm of certified public
accountants, each meeting the applicable requirements of Section
11.01(a) and each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have
been complied with and the Rating Agency Condition has been satisfied.
SECTION 4.02. Application of Trust Money. All moneys deposited
with the 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
Trustee may determine, to the Holders of the particular Notes for the payment or
redemption of which such moneys have been deposited with the Trustee, of all
sums due and to become due thereon for principal and interest; but such moneys
need not be segregated from other funds except to the extent required herein or
in the Sale and Servicing Agreement or required by law.
SECTION 4.03. Repayment of Moneys Held by Paying Agent. In
connection with the satisfaction and discharge of this Indenture with respect to
the Notes, all moneys then held by any Paying Agent other than the Trustee under
the provisions of this Indenture with respect to such Notes shall, upon written
demand of the Issuer, be paid to the Trustee to be held and applied according to
Section 3.03 and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.
SECTION 4.04. Release of Trust Estate. The Trustee shall, on
or after the Termination Date, release any remaining portion of the Trust Estate
from the Lien created by this Indenture and deposit in the Collection Account
any funds then on deposit in any other Trust Account. The Trustee shall release
property from the Lien created by this Indenture pursuant to this Section 4.04
only upon receipt of an Issuer Request accompanied by an Officer's Certificate,
an Opinion of Counsel and (if required by the TIA) Independent Certificates in
accordance with TIA Sections 314(c) and 314(d)(1) meeting the applicable
requirements of Section 11.01.
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):
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(i) default in the payment of any interest on any Class A Note
when the same becomes due and payable, and such default shall continue
for a period of five days (so long as any Class A Notes are
Outstanding, each Holder of any Class M and Class B Notes or the Owner
of any such note by such Holder's acceptance of such Note or beneficial
interest therein, as the case may be, shall be deemed to have consented
to the delay in payment of interest on such class of Notes and to have
waived its right to institute suit for enforcement of any such
payment); or
(ii) after the Class A Notes have been paid in full, default
in the payment on payment of interest on any Class M Note when the same
becomes due and payable, and such default shall continue for a period
of five days (so long as the Class M Notes are outstanding, each Holder
of any Class B Note or the Owner of any such note by such Holder's
acceptance of such note or beneficial interest therein, as the case may
be, shall be deemed to have consented to the delay in payment of
interest on such class of Notes and to have waived its right to
institute suit for enforcement of any such payment); or
(iii) after the Class M Notes have been paid in full, default
in the payment of any interest on any Class B Note when the same
becomes due and payable, and such default shall continue for a period
of five days (so long as the Class B Notes are outstanding); or
(iv) default in the payment of the principal of or any
installment of the principal of any Note when the same becomes due and
payable; or
(v) 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,
express or certified mail, to the Issuer by the Trustee or to the
Issuer and the Trustee by the Holders of at least 25% of the
Outstanding Amount of the Notes, a written notice specifying such
default or incorrect representation or warranty and requiring it to be
remedied and stating that such notice is a "Notice of Default"
hereunder; or
(vi) the commencement of an involuntary case against the
Issuer under any applicable Federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, and such case is not
dismissed within 60 days; or
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(vii) (A) 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, (B) the entry of an order for
relief in an involuntary case against the Issuer under any such law,
(C) the consent by the Issuer to the entry of any such order for
relief, (D) the consent by the Issuer to the appointment or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any substantial
part of the Trust Estate, (E) the making by the Issuer of any general
assignment for the benefit of creditors, (F) the failure by the Issuer
generally to pay its debts as such debts become due, or (G) the taking
of action by the Issuer in furtherance of any of the foregoing.
The Issuer shall deliver to the Trustee, within five days
after obtaining knowledge of the occurrence thereof, written notice in the form
of an Officer's Certificate of any event which with the giving of notice and the
lapse of time would become an Event of Default under clause (iii), its status
and what action the Issuer is taking or proposes to take with respect thereto.
SECTION 5.02. Rights upon Event of Default.
(a) If an Event of Default shall have occurred and be
continuing, the Notes shall become immediately due and payable at par, together
with accrued interest thereon. If an Event of Default shall have occurred and be
continuing, the Trustee may exercise any of the remedies specified in Section
5.04(a).
(b) If an Event of Default shall have occurred and be
continuing, the Trustee in its discretion may, or if so requested in writing by
the Controlling Noteholders shall, upon prior written notice to the Rating
Agencies, declare by written notice to the Issuer that the Notes become,
whereupon they shall become, immediately due and payable at par, together with
accrued interest thereon. Notwithstanding anything to the contrary in this
paragraph (b), if an Event of Default specified in Section 5.01(vi) or (vii)
shall occur and be continuing, the Notes shall become immediately due and
payable at par, together with accrued interest thereon.
SECTION 5.03. Collection of Indebtedness and Suits for
Enforcement by Trustee; Authority of Trustee.
(a) The Issuer covenants that if any Notes are accelerated
following the occurrence of an Event of Default, the Issuer will, upon demand of
the Trustee, pay to it, for the benefit of the Holders of such Notes, the whole
amount then due and payable on such Notes for principal and interest, with
interest upon the overdue principal, and, to the extent payment at such rate of
interest shall be legally enforceable, upon overdue installments of interest, at
the applicable Interest Rate and in addition thereto such further amount as
shall be sufficient to cover the costs and expenses of collection,
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including the reasonable compensation, expenses, disbursements, indemnified
amounts and advances of the Trustee and its agents and counsel.
(b) If an Event of Default occurs and is continuing, the
Trustee may in its discretion, proceed to protect and enforce its rights and the
rights of the Noteholders, by such appropriate Proceedings as the Trustee shall
deem most effective to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy
or legal or equitable right vested in the Trustee by this Indenture or by law.
(c) Notwithstanding anything to the contrary contained in this
Indenture (including without limitation Sections 5.04(a), 5.12, 5.13 and 5.17)
if the Issuer fails to perform its obligations under Section 10.01 hereof when
and as due, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Noteholders by such appropriate Proceedings as the
Trustee shall deem most effective to protect and enforce any such rights,
whether for specific performance of any covenant or agreement in this Indenture
or in aid of the exercise of any power granted herein, or to enforce any other
proper remedy or legal or equitable right vested in the Trustee by this
Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or
any other obligor upon the Notes or any Person having or claiming an ownership
interest in the Trust Estate, Proceedings under Title 11 of the United States
Code or any other applicable Federal or state bankruptcy, insolvency or other
similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor or Person, or in case of any other comparable judicial Proceedings
relative to the Issuer or other obligor upon the Notes, or to the creditors or
property of the Issuer or such other obligor, the Trustee, irrespective of
whether the principal of any Notes shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand pursuant to the provisions of this Section, shall be
entitled and empowered, by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount
of principal, interest and premium, if any, owing and unpaid in respect
of the Notes and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for reasonable compensation to the Trustee and
each predecessor Trustee, and their respective agents, attorneys and
counsel, and for reimbursement of all expenses and liabilities
incurred, and all advances made, by the Trustee and each predecessor
Trustee, except as a result of negligence or bad faith) and of the
Noteholders allowed in such Proceedings;
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(ii) unless prohibited by applicable law and regulations, to
vote on behalf of the Holders of Notes in any election of a trustee, a
standby trustee or Person performing similar functions in any such
Proceedings;
(iii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders and of the
Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Trustee or the Holders of Notes allowed in any judicial
proceedings relative to the Issuer, its creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Trustee, and, in the event that the Trustee shall consent to the
making of payments directly to such Noteholders, to pay to the Trustee such
amounts as shall be sufficient to cover reasonable compensation to the Trustee,
each predecessor Trustee and their respective agents, attorneys and counsel, and
all other expenses and liabilities incurred, and all advances made, by the
Trustee and each predecessor Trustee except as a result of negligence or bad
faith.
(e) Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Trustee to vote in respect of the claim of any Noteholder in any
such Proceeding except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this
Indenture or under any of the Notes, may be enforced by the Trustee without the
possession of any of the Notes or the production thereof in any trial or other
Proceedings relative thereto, and any such action or Proceedings instituted by
the Trustee shall be brought in its own name as trustee of an express trust, and
any recovery of judgment, subject to the payment of the expenses, disbursements
and compensation of the Trustee, each predecessor Trustee and their respective
agents and attorneys, shall be for the ratable benefit of the Holders of the
Notes.
(g) In any Proceedings brought by the Trustee (including any
Proceedings involving the interpretation of any provision of this Indenture),
the Trustee shall be held to represent all the Holders of the Notes, and it
shall not be necessary to make any Noteholder a party to any such Proceedings.
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SECTION 5.04. Remedies.
(a) If an Event of Default under Section 5.01(i), (ii), (iii),
(iv), (vi) or (vii) shall have occurred and be continuing which results in the
acceleration of the Notes (whether or not the Trust Estate is sold in one or
more public or private sales as provided in Section 5.04(d)(iv)), the Trustee
shall make payments on the Notes as provided in Section 5.06(a).
(b) If an Event of Default under Section 5.01(v) shall have
occurred and be continuing which results in the acceleration of the Notes
(whether or not the Trust Estate is sold in one or more public or private sales
as provided in Section 5.04(d)(iv)), the Trustee will make payments on the Notes
as provided in Section 5.06(b).
(c) If the Trustee, in compliance with Section 5.04(a) or (b),
is deemed to have a conflict of interest under the TIA and is required to resign
as Trustee hereunder, the Trustee, pursuant to Section 6.10, may appoint one or
more trustees to act separately hereunder for each class of Notes (in the case
of the Class A Notes, such trustee shall act for all Class A Notes as if they
comprised a single class). In the event separate trustees are appointed for one
or more classes of Notes:
(i) so long as any amounts remain unpaid with respect to the
Class A Notes, only the Trustee for the Class A Noteholders shall be
entitled to waive any Event of Default or Servicer Termination Event or
exercise any remedies under this Indenture;
(ii) after the Class A Notes have been paid in full, only the
Trustee for the Class M Noteholders shall be entitled to waive any
Event of Default or Servicer Termination Event or exercise any remedies
under this Indenture; and
(iii) after the Class M Notes have been paid in full, the
Trustee for the Class B Noteholders shall be entitled to waive any
Event of Default or Servicer Termination Event or exercise any remedies
under this Indenture.
(d) If an Event of Default shall have occurred and be
continuing, the Trustee may (subject to Section 5.05):
(i) institute Proceedings in its own name and as or on behalf
of a trustee of an express trust for the collection of all amounts then
payable on the Notes or under this Indenture with respect thereto,
whether by declaration or otherwise, enforce any judgment obtained, and
collect from the Issuer and any other obligor upon such Notes moneys
adjudged due;
(ii) institute Proceedings from time to time for the complete
or partial foreclosure of this Indenture with respect to the Trust
Estate;
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(iii) exercise any remedies of a secured party under the UCC
and any other remedy available to the Trustee and take any other
appropriate action to protect and enforce the rights and remedies of
the Noteholders; and
(iv) sell the Trust Estate or any portion thereof or rights or
interest therein, at one or more public or private sales called and
conducted in any manner permitted by law; provided, however, that
(A) the Trustee may not sell or otherwise liquidate
the Trust Estate following an Event of Default unless
(I) such Event of Default is of the type
described in Section 5.01(i), (ii), (iii) or (iv), or
(II) either
(x) the Holders of 100% of the
Outstanding Amount of the Notes consent
thereto,
(y) the proceeds of such sale or
liquidation distributable to the Noteholders
are sufficient to discharge in full all
amounts then due and unpaid upon such Notes
for principal and interest, or
(z) the Trustee determines that the
Trust Estate will not continue to provide
sufficient funds for the payment of
principal of and interest on the Notes as
they would have become due if the Notes had
not been declared due and payable, and the
Trustee provides prior written notice to the
Rating Agencies and obtains the consent of
the Controlling Noteholders.
In determining such sufficiency or insufficiency with respect
to clause (y) and (z), the Trustee may, but need not, obtain
and rely upon an opinion of an Independent investment banking
or accounting firm of national reputation as to the
feasibility of such proposed action and as to the sufficiency
of the Trust Estate for such purpose.
SECTION 5.05. Optional Preservation of the Receivables. If any
Notes have been declared to be due and payable under Section 5.02 following an
Event of Default and such declaration and its consequences have not been
rescinded and annulled, the Trustee may, but need not, elect to maintain
possession of the Trust Estate. It is the desire of the parties hereto and the
Noteholders that there be at all times sufficient funds for the payment of
principal of and interest on the Notes, and the
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Trustee shall take such desire into account when determining whether or not to
maintain possession of the Trust Estate. In determining whether to maintain
possession of the Trust Estate, the Trustee may, but need not, obtain and rely
upon an opinion of an Independent investment banking or accounting firm of
national reputation as to the feasibility of such proposed action and as to the
sufficiency of the Trust Estate for such purpose.
SECTION 5.06. Priorities.
(a) If the Trustee collects any money or property pursuant to
this Article V (including amounts on deposit in the Note Interest Distribution
Account and the Principal Distribution Account) following an Event of Default
described in Section 5.01(i), (ii), (iii), (iv), (vi) or (vii) and an
acceleration of the Notes pursuant to Section 5.02, the Trustee shall pay as
promptly as practicable out the money or property in the following order:
FIRST: amounts due and owing and required to be distributed by
the Trust to the Servicer, the Owner Trustee, the Administrator, the
Trustee, the Lockbox Bank and the Custodian, respectively, pursuant to
priorities (i), (ii) and (iii) of Section 4.6 of the Sale and Servicing
Agreement and not previously distributed, in the order of such
priorities and without preference or priority of any kind within such
priorities;
SECOND: to Class A Noteholders for amounts due and unpaid on
the Class A Notes for interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Class A
Notes for interest;
THIRD: to Class A-1 Noteholders for amounts due and unpaid on
the Class A-1 Notes for principal, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Class A-1 Notes for principal;
FOURTH: to Class A-2 Noteholders and Class A-3 Noteholders for
amounts due and unpaid on the Class A-2 Notes and Class A-3 Notes for
principal, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class A-2 Notes and
Class A-3 Notes for principal;
FIFTH: to Class M Noteholders for amounts due and unpaid on
the Class M Notes for interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Class M
Notes for interest;
SIXTH: to Class M Noteholders for amounts due and unpaid on
the Class M Notes for principal, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Class M Notes for principal;
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SEVENTH: to Class B Noteholders for amounts due and unpaid on
the Class B Notes for interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Class B
Notes for interest; and
EIGHTH: to Class B Noteholders for amounts due and unpaid on
the Class B Notes for principal, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Class B Notes for principal.
(b) If the Trustee collects any money or property pursuant to
this Article V (including amounts on deposit in the Note Interest Distribution
Account and the Principal Distribution Account) following an Event of Default
described in Section 5.01(v) and an acceleration of the Notes pursuant to
Section 5.02, the Trustee shall pay as promptly as practicable out the money or
property in the following order:
FIRST: amounts due and owing and required to be distributed to
the Servicer, the Owner Trustee, the Administrator, the Trustee, the
Lockbox Bank, and the Custodian, respectively, pursuant to priorities
(a), (b) and (c) of Section 4.6 of the Sale and Servicing Agreement and
not previously distributed, in the order of such priorities and without
preference or priority of any kind within such priorities;
SECOND: to Class A Noteholders for amounts due and unpaid on
the Class A Notes for interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Class A
Notes for interest;
THIRD: to the Class A Noteholders (sequentially, commencing
with the Class A-1 Noteholders), the First Priority Principal
Distribution Amount (as defined in the Sale and Servicing Agreement),
if any;
FOURTH: to Class M Noteholders for amounts due and unpaid on
the Class M Notes for interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Class M
Notes for interest;
FIFTH: to the Class A Noteholders (sequentially, commencing
with the Class A-1 Noteholders) until the Outstanding Amount of the
Class A Notes is reduced to zero and then to the Class M Noteholders,
the Second Priority Principal Distribution Amount (as defined in the
Sale and Servicing Agreement), if any;
SIXTH: to Class B Noteholders for amounts due and unpaid on
the Class B Notes for interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Class B
Notes for interest;
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SEVENTH: to Class A Noteholders (sequentially, commencing with
the Class A-1 Noteholders) for amounts due and unpaid on the Class A
Notes for principal, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Class A Notes for
principal;
EIGHTH: to Class M Noteholders for amounts due and unpaid on
the Class M Notes for principal, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Class M Notes for principal; and
NINTH: to Class B Noteholders for amounts due and unpaid on
the Class B Notes for principal, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Class B Notes for principal.
(c) The 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 Trustee shall mail to each Noteholder and the Issuer a notice
that states the record date, the payment date and the amount to be paid.
SECTION 5.07. Limitation of Suits. No Holder of any Note shall
have any right to institute any Proceeding, judicial or otherwise, with respect
to this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless:
(i) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the Outstanding
Amount of the Notes have made written request to the Trustee to
institute such Proceeding in respect of such Event of Default in its
name as Trustee hereunder;
(iii) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in complying with such request;
(iv) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute such
Proceedings; and
(v) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Controlling
Noteholders;
it being understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or
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prejudice the rights of any other Holders of Notes or to obtain or to seek to
obtain priority or preference over any other Holders or to enforce any right
under this Indenture, except in the manner herein provided.
In the event the Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of Notes,
neither representing the Controlling Noteholders, the Trustee in its sole
discretion may determine what action, if any, shall be taken, notwithstanding
any other provisions of this Indenture.
SECTION 5.08. Unconditional Rights of Noteholders To Receive
Principal and Interest. Notwithstanding any other provisions in this Indenture,
the Holder of any Note shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest on such Note
on or after the respective due dates thereof expressed in such Note or in this
Indenture (or, in the case of redemption, on or after the Redemption Date) and
to institute suit for the enforcement of any such payment, and such right shall
not be impaired without the consent of such Holder; provided, that the Holder or
Owner of a Class M Note will be deemed to have consented to any delay in payment
thereto of any interest due thereon that is in accordance with the payment of
interest pursuant to Section 4.6 of the Sale and Servicing Agreement and to have
waived its right to institute suit for enforcement of any such payment for so
long as any Class A Note is Outstanding, and each Holder or Owner of a Class B
Note will be deemed to have consented to any delay in the payment thereto of any
interest due thereon that is in accordance with payments of amounts pursuant to
Section 4.6 of the Sale and Servicing Agreement and to have waived its right to
institute suit for enforcement of any such payment for so long as any Class M
Note is Outstanding.
SECTION 5.09. Restoration of Rights and Remedies. If any
Noteholder has instituted any Proceeding to enforce any right or remedy under
this Indenture and such Proceeding has been discontinued or abandoned for any
reason or has been determined adversely to the Trustee or to such Noteholder,
then and in every such case the Issuer, the Trustee and the Noteholders shall,
subject to any determination in such Proceeding, be restored severally and
respectively to their former positions hereunder, and thereafter all rights and
remedies of the Trustee and the Noteholders shall continue as though no such
Proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative. No right or
remedy herein conferred upon or reserved to the 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.
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SECTION 5.11. Delay or Omission Not a Waiver. No delay or
omission of 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 Trustee
or to the Noteholders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Noteholders, as the case may be.
SECTION 5.12. Control by Controlling Noteholders. The
Controlling Noteholders shall have the right to direct the time, method and
place of conducting any Proceeding for any remedy available to the Trustee with
respect to the Notes or exercising any trust or power conferred on the Trustee;
provided that
(i) such direction shall not be in conflict with any rule of
law or with this Indenture;
(ii) subject to the express terms of Section 5.04, any
direction to the Trustee to sell or liquidate all or any portion of the
Trust Estate shall be by the Holders of Notes representing not less
than 100% of the Outstanding Amount of the Notes;
(iii) if the conditions set forth in Section 5.05 have been
satisfied and the Trustee elects to retain the Trust Estate pursuant to
such Section, then any direction to the Trustee by Holders of Notes
representing less than 100% of the Outstanding Amount of the Notes to
sell or liquidate all or any portion of the Trust Estate shall be of no
force and effect; and
(iv) the Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction; provided,
however, that, subject to Section 6.01, the Trustee need not take any
action that it determines might involve it in liability or might
materially and adversely affect the rights of any Noteholders not
consenting to such action.
SECTION 5.13. Waiver of Past Defaults.
The Controlling Noteholders may waive any past Default or
Event of Default and its consequences except a Default (a) in payment of
principal of or interest on any of the Notes or (b) in respect of a covenant or
provision hereof which cannot be modified or amended without the consent of the
Holder of each Note. In the case of any such waiver, the Issuer, the Trustee and
the Holders of the Notes shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereto.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have
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been cured and not to have occurred, for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or Event of Default
or impair any right consequent thereto.
SECTION 5.14. Undertaking for Costs. All parties to this
Indenture agree, and each Holder of any Note by such Holder's acceptance thereof
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Indenture, or in
any suit against the Trustee for any action taken, suffered or omitted by it as
Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section shall not apply to (a) any suit instituted by the Trustee, (b) any suit
instituted by any Noteholder, or group of Noteholders, in each case holding in
the aggregate more than 10% of the Outstanding Amount of the Notes or (c) any
suit instituted by any Noteholder for the enforcement of the payment of
principal of or interest on any Note on or after the respective due dates
expressed in such Note and in this Indenture (or, in the case of redemption, on
or after the Redemption Date).
SECTION 5.15. Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead or in any manner whatsoever, claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, that may affect the covenants or the performance of
this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantages of any such law, and covenants that
it will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 5.16. Action on Notes. The Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the lien of this Indenture nor any rights or remedies
of the Trustee or the Noteholders shall be impaired by the recovery of any
judgment by the Trustee against the Issuer or by the levy of any execution under
such judgment upon any portion of the Trust Estate or upon any of the assets of
the Issuer.
SECTION 5.17. Performance and Enforcement of Certain
Obligations.
(a) Promptly following a request from the Trustee to do so and
at the Seller's expense, the Issuer agrees to take all such lawful action as the
Trustee may request to compel or secure the performance and observance by the
Seller, the Servicer and AFL, as applicable, of each of their obligations to the
Issuer under or in connection with the Sale and Servicing Agreement or to the
Seller under or in connection with the Purchase Agreement in accordance with the
terms thereof, and to
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exercise any and all rights, remedies, powers and privileges lawfully available
to the Issuer under or in connection with the Sale and Servicing Agreement to
the extent and in the manner directed by the Trustee, including the transmission
of notices of default on the part of the Seller or the Servicer thereunder and
the institution of legal or administrative actions or proceedings to compel or
secure performance by the Seller or the Servicer of each of their obligations
under the Sale and Servicing Agreement.
(b) If an Event of Default has occurred and is continuing, the
Trustee may, and at the direction (which direction shall be in writing,
including facsimile) of the Controlling Noteholders shall, upon the receipt of
such indemnity as the Trustee may reasonably request, exercise all rights,
remedies, powers, privileges and claims of the Issuer against the Seller or the
Servicer under or in connection with the Sale and Servicing Agreement, including
the right or power to take any action to compel or secure performance or
observance by the Seller or the Servicer of each of their obligations to the
Issuer thereunder and to give any consent, request, notice, direction, approval,
extension or waiver under the Sale and Servicing Agreement, and any right of the
Issuer to take such action shall be suspended.
(c) Promptly following a request from the Trustee to do so and
at the Seller's expense, the Issuer agrees to take all such lawful action as the
Trustee may request to compel or secure the performance and observance by AFL of
each of its obligations to the Seller under or in connection with the Purchase
Agreement in accordance with the terms thereof, and to exercise any and all
rights, remedies, powers and privileges lawfully available to the Issuer under
or in connection with the Purchase Agreement to the extent and in the manner
directed by the Trustee, including the transmission of notices of default on the
part of the Seller thereunder and the institution of legal or administrative
actions or proceedings to compel or secure performance by AFL of each of its
obligations under the Purchase Agreement.
(d) If an Event of Default has occurred and is continuing the
Trustee may, and at the direction (which direction shall be in writing,
including facsimile) of the Controlling Noteholders shall, upon the receipt of
such indemnity as the Trustee may reasonably request, exercise all rights,
remedies, powers, privileges and claims of the Seller against AFL under or in
connection with the Purchase Agreement, including the right or power to take any
action to compel or secure performance or observance by AFL of each of its
obligations to the Seller hereunder and to give any consent, request, notice,
direction, approval, extension or waiver under the Purchase Agreement, and any
right of the Seller to take such action shall be suspended.
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ARTICLE VI
THE TRUSTEE
SECTION 6.01. Duties of Trustee.
(a) If an Event of Default of which a Responsible Officer of
the Trustee shall have actual knowledge has occurred and is continuing, the
Trustee shall exercise the rights and powers vested in it by this Indenture and
in the same degree of care and skill in their exercise as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default of
which a Responsible Officer of the Trustee shall have actual knowledge:
(i) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(ii) prior to the occurrence of a Event of Default of which a
Responsible Officer of the Trustee shall have actual knowledge, and
after the curing or waiver of all such Events of Default which may have
occurred, (A) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Indenture, (B) the
Trustee shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Indenture, (C) no
implied covenants or obligations shall be read into this Indenture
against the Trustee and (D) in the absence of bad faith on its part,
the Trustee may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon all
resolutions, statements, reports, documents, orders, certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture; provided, however, that the Trustee shall examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Indenture and the Trustee's other Related
Documents. If any such instrument is found not to conform in any
material respect to the requirements of this Indenture or any
applicable Related Document, the Trustee shall notify the Noteholders
of such instrument in the event the Trustee, after so requesting, does
not receive a satisfactorily corrected document.
(c) The Trustee may not be relieved from liability in its
individual capacity from liability to the Noteholders for its willful
misconduct, negligence or bad faith in connection with the distribution of
amounts from the Note Interest Distribution Account or the Principal
Distribution Account in accordance with the terms hereof, or for its willful
misconduct, negligence or bad faith in the performance of its duties as Trustee
hereunder, except that:
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(i) this paragraph does not limit the effect of paragraph (b)
of this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 5.12 or relating to the
time, method and place of conducting any proceeding for any remedy
available to the Trustee, or executing or omitting to execute any power
conferred upon the Trustee, under this Agreement.
(d) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuer.
(f) Money held in trust by the Trustee need not be segregated
from other funds except to the extent required by law or the terms of this
Indenture or the Sale and Servicing Agreement.
(g) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayments
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
(i) In no event shall the Trustee be required to perform, or
be responsible for the manner of performance of, any of the obligations of the
Servicer, or any other party, under the Sale and Servicing Agreement, except
during such time, if any, as the Trustee shall be the successor to, and be
vested with the rights, powers, duties and privileges of the Servicer in
accordance with the terms of, the Sale and Servicing Agreement.
(j) The Trustee shall, and hereby agrees that it will, perform
all of the obligations and duties required of it under the Sale and Servicing
Agreement.
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(k) Without limiting the generality of this Section 6.01, the
Trustee shall have no duty (i) to see to any recording, filing or depositing of
this Indenture or any agreement referred to herein or any financing statement
evidencing a security interest in the Financed Vehicles, or to see to the
maintenance of any such recording or filing or depositing or to any recording,
refiling or redepositing of any thereof, (ii) to see to any insurance of the
Financed Vehicles or Obligors or to effect or maintain any such insurance, (iii)
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, (iv) to confirm or verify the contents of
any reports or certificates delivered to the Trustee pursuant to this Indenture
or the Sale and Servicing Agreement believed by the Trustee to be genuine and to
have been signed or presented by the proper party or parties, or (v) to inspect
the Financed Vehicles at any time or ascertain or inquire as to the performance
of observance of any of the Issuer's, the Seller's or the Servicer's
representations, warranties or covenants or the Servicer's duties and
obligations as Servicer and as custodian of the Receivable Files under the
Agreement.
(l) The Trustee shall not be required to take notice or be
deemed to have notice or knowledge of an Event of Default or any other default
under this Indenture unless a Responsible Officer of the Trustee shall have
received written notice thereof. In the absence of receipt of such notice, the
Trustee may conclusively assume that there is no Event of Default or other such
default.
SECTION 6.02. Rights of Trustee.
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any document believed by it to be genuine and to
have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officer's Certificate (with respect to factual matters) or an Opinion
of Counsel, as applicable, which shall not be at the expense of the Trustee. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on the Officer's Certificate or Opinion of Counsel, as
applicable, or as directed by the requisite amount of Note Owners as provided
herein.
(c) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Trustee shall not be
responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however, that the Trustee's conduct does not
constitute willful misconduct, negligence or bad faith.
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(e) The Trustee may consult with counsel, and the advice of
such counsel or any Opinion of Counsel with respect to legal matters relating to
this Indenture or the Related Documents 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 of such counsel or Opinion of Counsel.
(f) The Trustee shall be under no obligation to institute,
conduct or defend any litigation under this Indenture or the Related Documents
or in relation to this Indenture, at the request, order or direction of any of
the Holders of Notes, pursuant to the provisions of this Indenture, unless such
Holders of Notes shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities that may be incurred
therein or thereby; provided, however, that the Trustee shall, upon the
occurrence of an Event of Default (that has not been cured or waived), exercise
the rights and powers vested in it by this Indenture with reasonable care and
skill.
(g) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing to do so by the Holders of
Notes evidencing not less than 25% of the Outstanding Amount thereof; provided,
however, that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture or the
Sale and Servicing Agreement, the Trustee may require reasonable indemnity
against such cost, expense or liability as a condition to so proceeding; the
reasonable expense of every such examination shall be paid by the Person making
such request, or, if paid by the Trustee, shall be reimbursed by the Person
making such request upon demand.
(h) The right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the Trustee
shall not be answerable for other than its negligence or willful misconduct in
the performance of such act.
(i) The Trustee shall not be required to give any bond or
surety in respect of the execution of the Trust or the Trust Estate created
hereby or the powers granted hereunder.
SECTION 6.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Notes and
may otherwise deal with the Issuer or its Affiliates with the same rights it
would have if it were not Trustee. Any Paying Agent, Note Registrar,
co-registrar or co-paying agent may do the same with like rights. However, the
Trustee is required to comply with Sections 6.11 and 6.12.
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SECTION 6.04. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture, the Related Documents, the Trust Estate or the Notes, it shall
not be accountable for the Issuer's use of the proceeds from the Notes, and it
shall not be responsible for any statement of the Issuer in the Indenture or in
any document issued in connection with the sale of the Notes or in the Notes
other than the Trustee's certificate of authentication.
SECTION 6.05. Notice of Defaults. If a Default occurs and is
continuing and if it is known to a Responsible Officer of the Trustee, the
Trustee shall mail to each Noteholder notice of the Default within 90 days after
it occurs. Except in the case of a Default in payment of principal of or
interest on any Note (including payments pursuant to the mandatory redemption
provisions of such Note), the Trustee may withhold the notice if and so long as
a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of Noteholders.
SECTION 6.06. Reports by Trustee to Holders. The Trustee shall
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.
(a) AFL in a separate letter agreement (the "Letter
Agreement") has covenanted and agreed to pay to the Trustee, and the Trustee
shall be entitled to, certain fees, which shall not be limited by any law on
compensation of a trustee of an express trust. In the Letter Agreement, AFL has
also agreed to reimburse the Trustee for all reasonable out-of-pocket expenses
incurred or made by it, including costs of collection, in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the Trustee's agents,
counsel, accountants and experts. AFL has also agreed to indemnify the Trustee
and any director, officer, employee or agent of the Trustee against any and all
loss, liability or expense (including attorneys' fees) incurred by it in
connection with the administration of this trust and the performance of its
duties hereunder.
(b) If notwithstanding the provisions of the Letter Agreement,
AFL fails to pay any fee, expense or indemnified amount due to the Trustee
pursuant to the terms of the Letter Agreement, the Trustee shall be entitled to
a distribution in respect of such amount pursuant of Section 4.6(ii) of the Sale
and Servicing Agreement. The Issuer's payment obligations to the Trustee
pursuant to this Section shall survive the discharge of this Indenture and the
removal or resignation of the Trustee. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 5.01(vi) or (vii) with respect
to the Issuer, the expenses are intended to constitute expenses of
administration under Title 11 of the United States Code or any other applicable
Federal or state bankruptcy, insolvency or similar law. Notwithstanding anything
else set forth in this Indenture or the Related Documents, the Trustee
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agrees that the obligations of the Issuer (but not AFL) to the Trustee hereunder
and under the Related Documents shall be recourse to the Trust Estate only. In
addition, the Trustee agrees that its recourse to the Issuer, the Trust Estate
and the Seller shall be limited to the right to receive the distributions
referred to in the first two sentences of this Section 6.07(b).
SECTION 6.08. Replacement of Trustee. The Trustee may resign
at any time by so notifying the Issuer. The Issuer may remove the Trustee if:
(i) the Trustee fails to comply with Section 6.11;
(ii) a court having jurisdiction in the premises in respect of
the Trustee in an involuntary case or proceeding under federal or state
banking or bankruptcy laws, as now or hereafter constituted, or any
other applicable federal or state bankruptcy, insolvency or other
similar law, shall have entered a decree or order granting relief or
appointing a receiver, liquidator, assignee, custodian, trustee,
conservator, sequestrator (or similar official) for the Trustee or for
any substantial part of the Trustee's property, or ordering the
winding-up or liquidation of the Trustee's affairs;
(iii) an involuntary case under the federal bankruptcy laws,
as now or hereafter in effect, or another present or future federal or
state bankruptcy, insolvency or similar law is commenced with respect
to the Trustee and such case is not dismissed within 60 days;
(iv) the Trustee commences a voluntary case under any federal
or state banking or bankruptcy laws, as now or hereafter constituted,
or any other applicable federal or state bankruptcy, insolvency or
other similar law, or consents to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
conservator, sequestrator (or other similar official) for the Trustee
or for any substantial part of the Trustee's property, or makes any
assignment for the benefit of creditors or fails generally to pay its
debts as such debts become due or takes any corporate action in
furtherance of any of the foregoing;
(v) the Trustee otherwise becomes incapable of acting; or
(vi) the rating assigned to the long-term unsecured debt
obligations of the Trustee (or the holding company thereof) by the
Rating Agencies shall be lowered below the rating of "BBB," "Baa3" or
equivalent rating or be withdrawn by either of the Rating Agencies.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Issuer shall promptly appoint a
successor Trustee.
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A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Thereupon the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Noteholders. The retiring Trustee shall promptly transfer all property held by
it as Trustee to the successor Trustee.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Issuer or the Holders of a majority in Outstanding Amount of the Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 6.11, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor Trustee
pursuant to this Section and payment of all fees and expenses owed to the
outgoing Trustee. Notwithstanding the replacement of the Trustee pursuant to
this Section, the retiring Trustee shall be entitled to payment or reimbursement
of such amounts as such Person is entitled pursuant to Section 6.07.
SECTION 6.09. Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee. The Trustee shall provide the Rating
Agencies prompt notice of any such transaction.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor hereunder or in the name of the successor to the
Trustee; and in all such cases such certificates shall have the full force which
it is anywhere in the Notes or in this Indenture provided that the certificate
of the Trustee shall have.
SECTION 6.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this Indenture, at
any time, for the purpose of meeting any legal requirement of any jurisdiction
in which any part of the Trust may at the
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time be located, the Trustee, shall have the power and may execute and deliver
all instruments to appoint one or more Persons to act as a co-trustee or
co-trustees, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person or Persons, in such capacity and for the
benefit of the Noteholders, such title to the Trust, or any part hereof, and,
subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Trustee may consider necessary or
desirable. No co-trustee or separate trustee hereunder shall be required to meet
the terms of eligibility as a successor Trustee under Section 6.11 and no notice
to Noteholders of the appointment of any co-trustee or separate trustee shall be
required under Section 6.08 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 Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed
the Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof in
any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the
Trustee;
(ii) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Indenture, specifically including every provision of this Indenture
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may at any time
constitute the Trustee, its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any
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lawful act under or in respect of this Agreement on its behalf and in its name.
If any separate trustee or co-trustee shall die, become incapable of acting,
resign or be removed, all of its estates, properties, rights, remedies and
trusts shall vest in and be exercised by the Trustee, to the extent permitted by
law, without the appointment of a new or successor trustee.
SECTION 6.11. Eligibility; Disqualification. The Trustee shall
at all times satisfy the requirements of TIA Section 310(a). The Trustee shall
have a combined capital and surplus of at least $50,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA Section 310(b), including the optional provision permitted by the second
sentence of TIA Section 310(b)(9); provided, however, that there shall be
excluded from the operation of TIA Section 310(b)(1) any indenture or indentures
under which other securities of the Issuer are outstanding if the requirements
for such exclusion set forth in TIA Section 310(b)(1) are met.
SECTION 6.12. Preferential Collection of Claims Against
Issuer. The Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.01. Issuer To Furnish Trustee Names and Addresses to
Noteholders. The Issuer will furnish or cause to be furnished to the Trustee (a)
not more than five days after the earlier of (i) each Record Date and (ii) three
months after the last Record Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders of Notes as of
such Record Date, and (b) at such other times as the 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 Trustee is the
Note Registrar, no such list shall be required to be furnished.
SECTION 7.02. Preservation of Information; Communications to
Noteholders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Trustee as provided in
Section 7.01 and the names and addresses of Holders of Notes received by the
Trustee in its capacity as Note Registrar. The Trustee may destroy any list
furnished to it as provided in such Section 7.01 upon receipt of a new list so
furnished.
(b) Noteholders may communicate pursuant to TIA Section 312(b)
with other Noteholders with respect to their rights under this Indenture or
under the Notes.
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(c) The Issuer, the Trustee and the Note Registrar shall have
the protection of TIA Section 312(c).
SECTION 7.03. Reports by Issuer.
(a) The Issuer shall:
(i) file with the Trustee, within 15 days after the Issuer is
required to file the same with the Commission, copies of the annual
reports and of the information, documents and other reports (or copies
of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe), which the Issuer may
be required to file with the Commission pursuant to Section 13 or 15(d)
of the Exchange Act;
(ii) file with the Trustee and the Commission in accordance
with rules and regulations prescribed from time to time by the
Commission such additional information, documents and reports with
respect to compliance by the Issuer with the conditions and covenants
of this Indenture as may be required from time to time by such rules
and regulations; and
(iii) supply to the Trustee (and the Trustee shall transmit by
mail to all Noteholders described in TIA Section 313(c)) such summaries
of any information, documents and reports required to be filed by the
Issuer pursuant to clauses (i) and (ii) of this Section 7.03(a) as may
be required by rules and regulations prescribed from time to time by
the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of
the Issuer shall end on December 31 of each year.
SECTION 7.04. Reports by Trustee. If required by TIA Section
313(a), within 60 days after each March 31, beginning with March 31, 2001, the
Trustee shall mail to each Noteholder as required by TIA Section 313(c) a brief
report dated as of such date that complies with TIA Section 313(a). The Trustee
also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to
Noteholders shall be filed by the Trustee with the Commission and each stock
exchange, if any, on which the Notes are listed. The Issuer shall notify the
Trustee if and when the Notes are listed on any stock exchange.
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ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.01. Collection of Money. Except as otherwise
expressly provided herein, the Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable to
or receivable by the Trustee pursuant to this Indenture as instructed in writing
by the Servicer. The Trustee shall apply all such money received by it as
provided in this Indenture. Except as otherwise expressly provided in this
Indenture, if any default occurs in the making of any payment or performance
under any agreement or instrument that is part of this Indenture or the Notes,
the Trustee may take such action as may be appropriate to enforce such payment
or performance, including the institution and prosecution of appropriate
Proceedings. Any such action shall be without prejudice to any right to claim a
Default or Event of Default under this Indenture and any right to proceed
thereafter as provided in Article V.
SECTION 8.02. 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 Trustee, for the
benefit of the Noteholders, the Trust Accounts as provided in Section 4.1 of the
Sale and Servicing Agreement.
(b) On each Payment Date and Redemption Date except following
an Event of Default and an acceleration of the Notes pursuant to Section 5.02,
the Trustee shall distribute all amounts on deposit in the Note Interest
Distribution Account to Noteholders in respect of the Notes to pay all accrued
and unpaid interest on the Notes in the following amounts and in the following
order of priority as directed in writing by the Servicer:
(i) accrued and unpaid interest on the Class A Notes, provided
that if funds in the Note Interest Distribution Account are not
sufficient to pay the entire amount of accrued but unpaid interest on
each class of Class A Notes, the amount in the Note Interest
Distribution Account shall be applied to the payment of such interest
on each class of Class A Notes pro rata on the basis of the amount of
accrued and unpaid interest on each class of Class A Notes;
(ii) accrued and unpaid interest on the Class M Notes; and
(iii) accrued and unpaid interest on the Class B Notes;
(c) On each Payment Date and Redemption Date except following
an Event of Default and an acceleration of the Notes pursuant to Section 5.02,
the Trustee shall distribute all
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amounts in the Principal Distribution Account in the following amounts and in
the following order of priority as directed in writing by the Servicer:
(i) to the Holders of the Class A-1 Notes in reduction of the
Outstanding Amount of the Class A-1 Notes until the Outstanding Amount
of the Class A-1 Notes is reduced to zero;
(ii) to the Holders of the Class A-2 Notes in reduction of the
Outstanding Amount of the Class A-2 Notes until the Outstanding Amount
of the Class A-2 Notes is reduced to zero;
(iii) to the Holders of the Class A-3 Notes in reduction of
the Outstanding Amount of the Class A-3 Notes until the Outstanding
Amount of the Class A-3 Notes is reduced to zero;
(iv) to the Holders of the Class M Notes in reduction of the
Outstanding Amount of the Class M Notes until the Outstanding Amount of
the Class M Notes is reduced to zero; and
(v) to the Holders of the Class B Notes in reduction of the
Outstanding Amount of the Class B Notes until the Outstanding Amount of
the Class B Notes is reduced to zero;
(vi) to the Certificate Distribution Account for distribution
to the Certificateholder.
SECTION 8.03. General Provisions Regarding Accounts.
(a) So long as no Default or Event of Default shall have
occurred and be continuing, all or a portion of the funds in the Trust Accounts
shall be invested and reinvested in Eligible Investments in accordance with the
provisions of Section 4.1(f) of the Sale and Servicing Agreement. All income or
other gain from investments of monies deposited in the Trust Accounts, net of
losses, shall be deposited (or caused to be deposited) by the Trustee in the
Collection Account; provided, however, that all income or other gain from
investments of monies deposited in the Reserve Account, net of losses, shall be
deposited in the Reserve Account. The Issuer will not direct the Trustee to make
any investment of any funds or to sell any investment held in any of the Trust
Accounts unless the security interest granted and perfected in such accounts
will continue to be perfected in such investment or the proceeds of such sale,
in either case without any further action by any Person, and, in connection with
any direction to the Trustee to make any such investment or sale, if requested
by the Trustee, the Issuer shall deliver to the Trustee an Opinion of Counsel,
acceptable to the Trustee, to such effect.
(b) If (i) the Issuer shall have failed to give investment
directions for any funds on deposit in the Trust Accounts to the Trustee by
11:00 a.m. Eastern Time (or such other time as may be
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agreed by the Issuer and Trustee) on any Business Day; or (ii) a Default or
Event of Default shall have occurred and be continuing with respect to the Notes
but the Notes shall not have been declared due and payable pursuant to Section
5.02, or (iii) if such Notes shall have been declared due and payable following
an Event of Default but amounts collected or receivable from the Trust Estate
are being applied in accordance with Section 5.06 as if there had not been such
a declaration; then the Trustee shall, to the fullest extent practicable, invest
and reinvest funds in the Trust Accounts in one or more investments under clause
(f) of the definition of Eligible Investments.
(c) Subject to Section 6.01(c), the Trustee shall not in any
way be held liable by reason of any insufficiency in any of the Trust Accounts
resulting from any loss on any Eligible Investment included therein except for
losses attributable to the Trustee's failure to make payments on such Eligible
Investments issued by the Trustee, in its commercial capacity as principal
obligor and not as Trustee, in accordance with their terms.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.01. Supplemental Indentures Without Consent of
Noteholders.
(a) Without the consent of the Holders of any Notes and with
prior notice to the Rating Agencies, the Issuer and the Trustee, when authorized
by an Issuer Order, at any time and from time to time, may enter into one or
more indentures supplemental hereto (which shall conform to the provisions of
the Trust Indenture Act as in force at the date of the execution thereof), in
form satisfactory to the Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property at
any time subject to the lien of this Indenture, or better to assure,
convey and confirm unto the Trustee any property subject or required to
be subjected to the Lien created by this Indenture, or to subject to
the Lien created by this Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another Person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein
and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit
of the Holders of the Notes, or to surrender any right or power herein
conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee;
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(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be
inconsistent with any other provision herein or in any supplemental
indenture 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 Trustee is hereby authorized to join in the execution of
any such supplemental indenture and to make any further appropriate agreements
and stipulations that may be therein contained.
(b) The Issuer and the Trustee, when authorized by an Issuer
Order, may, also without the consent of any of the Holders of the Notes and 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; and provided, further, that any amendment within the scope of
Section 9.02(i)-(vii) below shall be deemed to materially and adversely affect
the interests of the Noteholders.
SECTION 9.02. Supplemental Indentures With Consent of
Noteholders. The Issuer and the 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 each class of
Notes, by Act of such Holders delivered to the Issuer and the 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
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with respect thereto, change the provision of this Indenture relating
to the application of collections on, or the proceeds of the sale of,
the Trust Estate to payment of principal of or interest on the Notes,
or change any place of payment where, or the coin or currency in which,
any Note or the interest thereon is payable, or impair the right to
institute suit for the enforcement of the provisions of this Indenture
requiring the application of funds available therefor, as provided in
Article V, to the payment of any such amount due on the Notes on or
after the respective due dates thereof (or, in the case of redemption,
on or after the Redemption Date);
(ii) 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) modify or alter the provisions of the second proviso to
the definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding Amount of the
Notes required to direct the Trustee to direct the Issuer to sell or
liquidate the Trust Estate pursuant to Section 5.04;
(v) modify any provision of this Section except to increase
any percentage specified herein or to provide that certain additional
provisions of this Indenture or the Related Documents cannot be
modified or waived without the consent of the Holder of each
Outstanding Note affected thereby;
(vi) modify any of the provisions of this Indenture in such
manner as to affect the calculation of the amount of any payment of
interest or principal due on any Note on any Payment Date (including
the calculation of any of the individual components of such
calculation) or to affect the rights of the Holders of Notes to the
benefit of any provisions for the mandatory redemption of the Notes
contained herein; or
(vii) permit the creation of any Lien ranking prior to or on a
parity with the Lien created by this Indenture with respect to any part
of the Trust Estate or, except as otherwise permitted or contemplated
herein, terminate the Lien created by this Indenture on any property at
any time subject hereto or deprive the Holder of any Note of the
security provided by the lien created by this Indenture.
The Trustee may in its discretion determine whether or not any
Notes would be affected by any supplemental indenture, and any such
determination shall be conclusive upon the
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Holders of all Notes, whether theretofore or thereafter authenticated and
delivered hereunder. The 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 Trustee of
any supplemental indenture pursuant to this Section, the 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 Trustee to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such supplemental indenture.
SECTION 9.03. Execution of Supplemental Indentures. In
executing, or permitting the additional trusts created by, any supplemental
indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive, and
subject to Sections 6.01 and 6.02 shall be fully protected in relying upon, an
Opinion of Counsel (which shall not be at the expense of the Trustee) stating
that the execution of such supplemental indenture is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture that affects the Trustee's own rights, duties,
liabilities or immunities under this Indenture or otherwise.
SECTION 9.04. Effect of Supplemental Indenture. Upon the
execution of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Trustee, the Issuer and the Holders of the Notes shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 9.05. Conformity With Trust Indenture Act. Every
amendment of this Indenture and every supplemental indenture executed pursuant
to this Article IX shall conform to the requirements of the Trust Indenture Act
as then in effect so long as this Indenture shall then be qualified under the
Trust Indenture Act.
SECTION 9.06. Reference in Notes to Supplemental Indentures.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article IX may, and if required by the Trustee shall,
bear a notation in form approved by the Trustee as to any matter provided for in
such supplemental indenture. If the Issuer or the Trustee shall so determine,
new
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notes so modified as to conform, in the opinion of the Trustee and the Issuer,
to any such supplemental indenture may be prepared and executed by the Issuer
and authenticated and delivered by the Trustee in exchange for Outstanding
Notes.
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.01. Redemption. In the event that the Servicer
pursuant to Section 9.1(a) of the Sale and Servicing Agreement purchases the
corpus of the Trust, the Notes are subject to redemption in whole, but not in
part, on the Payment Date on which such repurchase occurs, for a purchase price
equal to the Redemption Price; provided, however, that the Issuer has available
funds sufficient to pay the Redemption Price. The Seller, the Servicer or the
Issuer shall furnish the Trustee, Owner Trustee and the Rating Agencies with
written notice of such redemption. If the Notes are to be redeemed pursuant to
this Section 10.01, the Servicer or the Issuer shall furnish notice of such
election to the Trustee not later than 25 days prior to the Redemption Date, and
the Issuer shall deposit with the Trustee in the Note Interest Distribution
Account and the Principal 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 Trustee by first-class mail, postage
prepaid, mailed not less than five days prior to the applicable Redemption Date
to each Holder of Notes, as of the close of business on the Record Date with
respect to the Payment Date immediately preceding the applicable Redemption
Date, at such Holder's address appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
(iii) the place where such Notes are to be surrendered for
payment of the Redemption Price (which shall be the office or agency of
the Issuer to be maintained as provided in Section 3.02).
Notice of redemption of the Notes shall be given by the
Trustee in the name and at the expense of the Issuer. Failure to give notice of
redemption, or any defect therein, to any Holder of any Note shall not impair or
affect the validity of the redemption of any other Note.
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SECTION 10.03. Notes Payable on Redemption Date. The Notes or
portions thereof to be redeemed shall, following notice of redemption (if any)
as required by Section 10.02, on the Redemption Date become due and payable at
the Redemption Price and (unless the Issuer shall default in the payment of the
Redemption Price) no interest shall accrue on the Redemption Price for any
period after the date to which accrued interest is calculated for purposes of
calculating the Redemption Price.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Compliance Certificates and Opinions, etc.
(a) Upon any application or request by the Issuer to the
Trustee to take any action under any provision of this Indenture, the Issuer
shall furnish to the Trustee (i) an Officer's Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with, (ii) an Opinion of Counsel stating that
in the opinion of such counsel all such conditions precedent, if any, have been
complied with and (iii) (if required by the TIA) an Independent Certificate from
a firm of certified public accountants meeting the applicable requirements of
this Section, except that, in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Indenture, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
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(b) (i) Prior to the deposit of any Collateral or other
property or securities with the Trustee that is to be made the basis
for the release of any property subject to the Lien created by this
Indenture, the Issuer shall, in addition to any obligation imposed in
Section 11.01(a) or elsewhere in this Indenture, furnish to the Trustee
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 Trustee
an Officer's Certificate certifying or stating the opinion of any
signer thereof as to the matters described in clause (i) above, the
Issuer shall also deliver to the Trustee an Independent Certificate as
to the same matters, if the fair value to the Issuer of the property to
be so deposited and of all other such property made the basis of any
such withdrawal or release since the commencement of the then-current
fiscal year of the Issuer, as set forth in the certificates delivered
pursuant to clause (i) above and this clause (ii), is 10% or more of
the Outstanding Amount of the Notes, but such a certificate need not be
furnished with respect to any property so deposited, if the fair value
thereof to the Issuer as set forth in the related Officer's Certificate
is less than $25,000 or less than one percent of the Outstanding Amount
of the Notes.
(iii) Other than with respect to any release described in
clause (A) or (B) of Section 11.01(b)(v), whenever any property or
securities are to be released from the Lien created by this Indenture,
the Issuer shall also furnish to the Trustee an Officer's Certificate
certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days of such release) of
the property or securities proposed to be released and stating that in
the opinion of such person the proposed release will not impair the
security created by this Indenture in contravention of the provisions
hereof.
(iv) Whenever the Issuer is required to furnish to the Trustee
an Officer's Certificate certifying or stating the opinion of any
signer thereof as to the matters described in clause (iii) above, the
Issuer shall also furnish to the Trustee an Independent Certificate as
to the same matters if the fair value of the property or securities and
of all other property or securities (other than property described in
clauses (A) or (B) of Section 11.01(b)(v)) released from the lien
created by this Indenture since the commencement of the then current
fiscal year, as set forth in the certificates required by clause (iii)
above and this clause (iv), equals 10% or more of the Outstanding
Amount of the Notes, but such certificate need not be furnished in the
case of any release of property or securities if the fair value thereof
as set forth in the related Officer's Certificate is less than $25,000
or less than one percent of the then Outstanding Amount of the Notes.
(v) Notwithstanding any other provision of this Section, the
Issuer may, without compliance with the other provisions of this
Section (A) collect, liquidate, sell or otherwise
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dispose of Receivables as and to the extent permitted or required by
the Related Documents (including as provided in Section 3.1 of the Sale
and Servicing Agreement) and (B) make cash payments out of the Trust
Accounts as and to the extent permitted or required by the Related
Documents.
SECTION 11.02. Form of Documents Delivered to Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Servicer, the Seller or the Issuer, stating that the information with
respect to such factual matters is in the possession of the Servicer, the Seller
or the Issuer, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
Whenever in this Indenture, in connection with any application
or certificate or report to the Trustee, it is provided that the Issuer shall
deliver any document as a condition of the granting of such application, or as
evidence of the Issuer's compliance with any term hereof, it is intended that
the truth and accuracy, at the time of the granting of such application or at
the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Trustee's right to rely upon the truth and accuracy of
any statement or opinion contained in any such document as provided in Article
VI.
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SECTION 11.03. Acts of Noteholders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by agents
duly appointed in writing; and except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Trustee, and, where it is hereby expressly required, to the
Issuer. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the
Noteholders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and (subject to
Section 6.01) conclusive in favor of the Trustee and the Issuer, if made in the
manner provided in this Section.
(b) The fact and date of the execution by any person of any
such instrument or writing may be proved in any manner that the Trustee deems
sufficient.
(c) The ownership of Notes shall be proved by the Note
Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Notes shall bind the Holder
of every Note issued upon the registration thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by the
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.
SECTION 11.04. Notices, etc., to Trustee, Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Noteholders or other documents provided or permitted by this Indenture
to be made upon, given or furnished to or filed with:
(a) the Trustee by any Noteholder or by the Issuer shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
(b) the Issuer by the Trustee or by any Noteholder shall be
sufficient for every purpose hereunder if in writing and mailed,
first-class, postage prepaid, to the Issuer addressed to: Associates
Automobile Receivables Trust 2000-1, in care of Wilmington Trust
Company, as Owner Trustee, Rodney Square North, 1100 North Market
Street, Wilmington, Delaware 19890, Attention: Corporate Trust
Administration, or at any other address previously furnished in writing
to the Trustee by Issuer. The Issuer shall promptly transmit any notice
received by it from the Noteholders to the Trustee.
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Notices required to be given to the Rating Agencies by the
Issuer, the Trustee or the Owner Trustee shall be in writing,
personally delivered or mailed by certified mail, return receipt
requested to (i) in the case of Moody's, at the following address:
Moody's Investors Service, Inc., ABS Monitoring Department, 99 Church
Street, New York, New York 10007 and (ii) in the case of Standard &
Poor's, at the following address: Standard & Poor's Ratings Services,
55 Water Street, 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 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 his or her 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 Trustee
but such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service
as a result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event of Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the 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 Trustee or any Paying Agent
to such Holder, that is different from the methods provided for in this
Indenture for such
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payments or notices. The Issuer will furnish to the Trustee a copy of each such
agreement and the Trustee will cause payments to be made and notices to be given
in accordance with such agreements.
SECTION 11.07. Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with another provision hereof
that is required to be included in this indenture by any of the provisions of
the Trust Indenture Act, such required provision shall control.
The provisions of TIA Sections 310 through 317 that
impose duties on any Person (including the provisions automatically deemed
included herein unless expressly excluded by this Indenture) are a part of and
govern this Indenture, whether or not physically contained herein.
SECTION 11.08. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 11.09. Successors and Assigns. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successors and assigns, whether so expressed or not. All agreements of the
Trustee in this Indenture shall bind its successors.
SECTION 11.10. Severability. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality, and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 11.11. Benefits of Indenture. Nothing in this
Indenture or in the Notes, express or implied, shall give to any Person, other
than the parties hereto and their successors hereunder, and the Noteholders, and
any other party secured hereunder, and any other Person with an ownership
interest in any part of the Trust Estate, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 11.12. Legal Holidays. In any case where the date on
which any payment is due shall not be a Business Day, then (notwithstanding any
other provision of the Notes or this Indenture) payment need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
SECTION 11.13. Governing Law. THIS INDENTURE SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
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SECTION 11.14. Counterparts. This Indenture may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 11.15. Recording of Indenture. If this Indenture is
subject to recording in any appropriate public recording offices, such recording
is to be effected by the Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Trustee or any other counsel reasonably
acceptable to the Trustee) to the effect that such recording is necessary either
for the protection of the Noteholders or any other Person secured hereunder or
for the enforcement of any right or remedy granted to the Trustee under this
Indenture.
SECTION 11.16. Trust Obligation. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the Owner
Trustee or the Trustee on the Notes or under this Indenture or any certificate
or other writing delivered in connection herewith or therewith, against (i) the
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
agent, officer, director, employee or agent of the Trustee or the Owner Trustee
in its individual capacity, any holder of a beneficial interest in the Issuer,
the Owner Trustee or the Trustee or of any successor or assign of the Trustee or
the Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Trustee and the Owner Trustee
have no such obligations in their individual capacity) and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity. For
all purposes of this Indenture, in the performance of any duties or obligations
of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to
the benefits of, the terms and provisions of Articles VI, VII and VIII of the
Trust Agreement.
SECTION 11.17. No Petition. The Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time institute against the Seller or the Issuer, or
join in any institution against the Seller or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Notes, this Indenture or any
of the Related Documents.
SECTION 11.18. Inspection. The Issuer agrees that, on
reasonable prior notice, it will permit any representative of the Trustee,
during the Issuer's normal business hours, to examine all the books of account,
records, reports, and other papers of the Issuer, to make copies and extracts
therefrom, to cause such books to be audited by independent certified public
accountants, and to discuss the Issuer's affairs, finances and accounts with the
Issuer's officers, employees, and independent certified public accountants, all
at such reasonable times and as often as may be reasonably requested. The
Trustee shall and shall cause its representatives to hold in confidence all
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such information except to the extent disclosure may be required by law (and all
reasonable applications for confidential treatment are unavailing) and except to
the extent that the Trustee may reasonably determine that such disclosure is
consistent with its obligations hereunder.
SECTION 11.19. Limitation of Liability. It is expressly
understood and agreed by the parties hereto that (a) this Agreement is executed
and delivered by Wilmington Trust Company, not individually or personally but
solely as Owner Trustee of the Issuer under the Trust Agreement, in the exercise
of the powers and authority conferred and vested in it, (b) each of the
representations, undertakings and agreements herein made on the part of the
Issuer is made and intended not as personal representations, undertakings and
agreements by 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 to this Agreement and
by any person claiming by, through or under them 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 Agreement or any related documents.
SECTION 11.20. No Substantive Review of Compliance Documents.
Other than as set forth in this Agreement, any reports, information or other
documents provided to the Trustee are for purposes only of enabling the sending
party to comply with its document delivery requirements hereunder, and such
party's receipt of any such information shall not constitute actual or
constructive notice of any information contained therein or determinable from
any information contained therein, including the Issuer's, the Seller's or the
Servicer's compliance with any of its covenants, representations or warranties
hereunder.
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IN WITNESS WHEREOF, the Issuer and the Trustee have caused
this Indenture to be duly executed by their respective officers, thereunto duly
authorized, all as of the day and year first above written.
ASSOCIATES AUTOMOBILE RECEIVABLES
TRUST 2000-1
By WILMINGTON TRUST COMPANY
not in its individual capacity but solely as Owner
Trustee under the Trust Agreement
By: /s/ Anita Dallago
---------------------------
Name: Anita Dallago
Title: Financial Services Officer
BANK ONE, NATIONAL ASSOCIATION
not in its individual capacity but solely as
Trustee
By: /s/ Barbara G. Grosse
---------------------------
Name: Barbara G. Grosse
Title: Vice President and Assistant Secretary
