Servicer Defaults If any one of the following events (each, a “Servicer Default”) shall occur and be continuing there shall be a Servicer Default:
(a) any failure by the Servicer to deliver to the related Trustee for deposit in any of the Accounts or the Certificate Distribution Account any required payment or to direct the Indenture Trustee to make any required distributions therefrom, which failure continues unremedied for a period of five (5) Business Days after discovery of such failure by an officer of the Servicer or after the date on which written notice of such failure, requiring the same to be remedied, shall have been given (i) to the Servicer by the related Trustee or (ii) to the Servicer and to the Trustees by the Noteholders, evidencing not less than 25% of the Outstanding Amount of the Notes;
(b) failure by the Servicer duly to observe or to perform in any material respect any other covenants or agreements of the Servicer set forth in this Agreement or any other Basic Document, which failure shall (i) materially and adversely affect the rights of Certificateholders or Noteholders and (ii) continue unremedied for a period of ninety (90) days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given (A) to the Servicer by the related Trustee or (B) to the Servicer, and to the related Trustee by the Noteholders, evidencing not less than 25% of the Outstanding Amount of the Notes; or
(c) the occurrence of an Insolvency Event with respect to the Servicer; provided, however, that (A) if any delay or failure of performance referred to in clause (a) above shall have been caused by Force Majeure or other similar occurrences, the five (5) Business Day grace period referred to in such clause (a) shall be extended for an additional sixty (60) days and (B) if any delay or failure of performance referred to in clause (b) above shall have been caused by Force Majeure or other similar occurrences, the ninety (90) day grace period referred to in such clause (b) shall be extended for an additional sixty (60) days. If a Servicer Default shall have occurred and be continuing, either the Noteholders evidencing not less than 25% of the Outstanding Amount of the Notes or the Indenture Trustee, at the request or direction of the Noteholders evidencing not less than 25% of the Outstanding Amount of the Notes (or, if the Notes have been paid in full and the Indenture has been discharged in accordance with its terms, by holders of Certificates evidencing not less than 25% of the Percentage Interests), by notice then given in writing to the Servicer and the Owner Trustee (and to the Indenture Trustee if given by the Noteholders) may terminate all the rights and obligations (other than the obligations set forth in Section 6.02 that accrued on or prior to the effective date of the termination) of the Servicer under this Agreement. On or after the date specified in such written notice, all authority and power of the Servicer under this Agreement, whether with respect to the Notes, the Certificates or the Receivables or otherwise, shall, without further action, pass to and be vested in the Indenture Trustee or such Successor Servicer as may be appointed under Section 7.02; and, without limitation, the Indenture Trustee and the Owner Trustee are hereby authorized and empowered to execute and deliver, for the benefit of the predecessor Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of the Receivables and related documents, or otherwise. The predecessor Servicer shall cooperate with the Successor Servicer and the Trustees in effecting the termination of the responsibilities and rights of the predecessor Servicer under this Agreement, including the transfer to the Successor Servicer for administration by it of all cash amounts that shall at the time be held by the predecessor Servicer for deposit, or have been deposited by the predecessor Servicer, in the Accounts or the Certificate Distribution Account or thereafter received with respect to the Receivables that shall at that time by held by the predecessor Servicer. All reasonable costs and expenses (including servicer conversion costs and attorneys’ fees) incurred in connection with transferring the Receivable Files to the Successor Servicer and amending this Agreement to reflect such succession as Servicer pursuant to this Section shall be paid by the predecessor Servicer upon presentation of reasonable documentation of such costs and expenses. Any costs or expenses incurred in connection with a Servicer Default shall constitute an expense of administration under Title 11 of the United States Bankruptcy Code or any other applicable Federal or State bankruptcy laws. Upon receipt of notice of the occurrence of a Servicer Default, the Indenture Trustee shall give notice thereof to the Administrator, and in accordance with Section 1.02(c) of the Administration Agreement, the Administrator shall make such notice available to each Rating Agency.
