1
EXHIBIT 3.2
LIMITED LIABILITY COMPANY AGREEMENT
of
FORD CREDIT AUTO RECEIVABLES TWO LLC
(a Delaware Limited Liability Company)
by
FORD MOTOR CREDIT COMPANY,
as Member
dated as of January 29, 2001
2
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS
Section 1.1 Definitions...........................................................1
ARTICLE II ORGANIZATION
Section 2.1 Formation, Name, Location of Office...................................5
Section 2.2 Registered Office in Delaware.........................................5
Section 2.3 Registered Agent......................................................5
Section 2.4 Purposes and Powers...................................................5
Section 2.5 Conduct of Business...................................................7
Section 2.6 Tax Reporting and Characterization...................................11
Section 2.7 Term.................................................................11
ARTICLE III THE MEMBER
Section 3.1 The Member...........................................................11
Section 3.2 Powers of Member. ...................................................11
Section 3.3 Limited Liability of the Member......................................12
ARTICLE IV MANAGEMENT OF THE COMPANY;
THE BOARD OF MANAGERS; OFFICERS
Section 4.1 General Management of the Company....................................12
Section 4.2 Appointment and Term.................................................12
Section 4.3 Number; Independent Managers.........................................12
Section 4.4 Power to Bind Company................................................16
Section 4.5 Restrictions on the Power of the Managers............................16
Section 4.6 Duties and Obligations of the Managers...............................16
Section 4.7 Resignation..........................................................18
Section 4.8 Removal of Managers..................................................18
Section 4.9 Filling of Vacancies.................................................18
Section 4.10 Managers' Compensation...............................................18
Section 4.11 Officers.............................................................18
ARTICLE V THE SERIES
Section 5.1 Series...............................................................19
Section 5.2 Series Designation Certificates......................................20
ARTICLE VI CAPITAL STRUCTURE AND CONTRIBUTIONS
Section 6.1 Capital Structure....................................................20
Section 6.2 Capital Contributions................................................21
ARTICLE VII PROFITS AND LOSSES; DISTRIBUTIONS
Section 7.1 Profits and Losses...................................................21
Section 7.2 Distributions........................................................21
ARTICLE VIII EXCULPATION; LIABILITIES: INDEMNIFICATION
Section 8.1 Exculpation..........................................................21
Section 8.2 Liabilities: Indemnification.........................................21
Section 8.3 Amendments: Indemnification..........................................24
ARTICLE IX MISCELLANEOUS
Section 9.1 Bankruptcy of the Member.............................................24
Section 9.2 Amendments...........................................................24
Section 9.3 Assignments..........................................................24
Section 9.4 Single Member........................................................24
Section 9.5 Admission of New Member..............................................25
Section 9.6 Severability.........................................................25
3
PAGE
Section 9.7 Successors and Assigns...............................................25
Section 9.8 Limited Liability Company............................................25
Section 9.9 Headings.............................................................25
Section 9.10 Governing Law........................................................25
Exhibit A Certificate of Formation............................................A-1
4
LIMITED LIABILITY COMPANY AGREEMENT
OF
FORD CREDIT AUTO RECEIVABLES TWO LLC
(A Delaware Limited Liability Company)
THIS LIMITED LIABILITY COMPANY AGREEMENT, (the "Agreement") of FORD
CREDIT AUTO RECEIVABLES TWO LLC, a Delaware limited liability company (the
"Company") dated as of this 29th day of January, 2001, by Ford Motor Credit
Company, as the sole member of the Company (the "Member").
RECITAL
The Member has formed the Company as a limited liability company under
the laws of Delaware and desires to enter into a written agreement, in
accordance with the provisions of the Delaware Limited Liability Company Act, 6
Del. C. ss. 18-101, et seq. (as amended and in effect from time to time, and any
successor statute, the "Act"), governing the affairs of the Company and the
conduct of its business.
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. Whenever used in this Agreement, capitalized
terms shall have the meanings assigned to them herein. All references herein to
"this Agreement" are to this Limited Liability Company Agreement, and all
references herein to Articles, Sections and subsections are to Articles,
Sections and subsections of this Agreement unless otherwise specified.
"Act" has the meaning set forth in the recital.
"Affiliate" shall mean, in respect of any specified Person, any other
Person that directly or indirectly controls, is controlled by or is under direct
or indirect common control with the specified Person. For purposes of this
Agreement, "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with"), as used with respect to any
Person, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of such Person,
whether through the ownership of voting securities, by agreement or otherwise.
"Agreement" shall have the meaning set forth in the preamble hereto.
"Basic Documents" shall mean this Agreement, any Transfer and Servicing
Agreement, Indenture, trust agreement, purchase agreement, administration
agreement, Note depositary agreement and other agreements relating to the
issuance of Notes and Certificates, including the other documents and
certificates delivered in connection with such agreements, as such agreements
may be amended from time to time.
"Board of Managers" has the meaning set forth in Section 4.1.
"Certificate of Formation" has the meaning set forth in Section 2.1.
"Certificates" has the meaning set forth in Section 2.4(d).
5
"Code" shall mean the Internal Revenue Code of 1986, as amended (or any
successor law).
"Company" shall have the meaning set forth in the preamble hereto.
"Company Assets" shall mean, as of any date of determination, all
right, title and interest of the Company in, to and under the Receivables and
any related property and all other property acquired by the Company from time to
time as of such date of determination and all proceeds thereof.
"control" shall have the meaning set forth in the definition of the
term "Affiliate" above.
"Damages" shall have the meaning set forth in Section 8.2.
"Fiscal Year" shall mean, unless the Member shall at any time determine
otherwise pursuant to the requirements of the Code, for each year, the period
commencing on January 1 and ending on December 31, except that the initial
fiscal year shall commence on the filing of a Certificate of Formation in the
office of the Secretary of State of the State of Delaware and shall end as
required pursuant to the Code.
"Ford Credit" shall mean Ford Motor Credit Company, a Delaware
corporation.
"General Series" shall mean the Series to which all assets of the
Company which have not been assigned or allocated to a Specified Series shall be
allocated.
"Indemnified Party" has the meaning set forth in Section 8.2.
"Indenture" has the meaning set forth in Section 8.2.
"Independent Manager" has the meaning set forth in Section 4.3(b).
"Insolvency Event" shall mean, with respect to any Person, (i) the
making of a general assignment for the benefit of creditors, (ii) the filing of
a voluntary petition in bankruptcy, (iii) being adjudged a bankrupt or
insolvent, or having had entered against such Person an order for relief in any
bankruptcy or insolvency proceeding, (iv) the filing by such Person of a
petition or answer seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any statute, law
or regulation, (v) the filing by such Person of an answer or other pleading
admitting or failing to contest the material allegations of a petition filed
against such Person in any proceeding specified in clause (vii) below, (vi)
seeking, consenting to or acquiescing in the appointment of a trustee, receiver
or liquidator of such Person or of all or any substantial part of the assets of
such Person or (vii) the failure to obtain dismissal within 60 days of the
commencement of any proceeding against such Person seeking reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under any statute, law or regulation, or the entry of any order
appointing a trustee, liquidator or receiver of such Person or of such Person's
assets or any substantial portion thereof.
"Manager" has the meaning set forth in Section 4.2.
"Member" shall mean Ford Motor Credit Company and its successors and
permitted assigns, as herein provided.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
6
"Notes" shall have the meaning set forth in Section 2.4(d).
"Percentage Interest" shall have the meaning set forth in Section 6.1.
"Permitted Transaction" shall have the meaning set forth in Section
2.4(h).
"Person" shall mean a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, limited liability partnership, trust,
unincorporated organization or government or any agency or political
subdivision thereof, or any other entity of whatever nature.
"Rating Agency" shall mean, with respect to any outstanding Notes or
Certificates, each statistical rating agency selected by the Company to rate
such Notes or Certificates.
"Rating Agency Condition" shall mean, with respect to any action, that
each Rating Agency shall have been given prior notice thereof and that each of
the Rating Agencies shall have notified the Company and the servicer and the
trustees under the related Transfer and Servicing Agreements and Indentures in
writing that such action will not result in a reduction or withdrawal of the
rating of any outstanding Notes or Certificates with respect to which it is a
Rating Agency.
"Rating Event" shall mean the earliest to occur of (i) the downgrading
of Ford Credit's short-term unsecured debt to or below (A) A-2 by Standard &
Poor's or (B) P-2 by Moody's or (ii) the downgrading of Ford Credit's senior
long-term debt to or below (A) A- by Standard & Poor's or (B) A3 by Moody's, and
shall be deemed to exist only for so long as (x) Ford Credit's short-term
unsecured debt is rated at or below (A) A-2 by Standard & Poor's or (B) P-2 by
Moody's or (y) Ford Credit's senior long-term debt is rated at or below (A) A-
by Standard & Poor's or (B) A3 by Moody's.
"Receivables" has the meaning set forth in Section 2.4(a).
"Security" has the meaning set forth in Section 2.4(d).
"Secretary of State" means the Secretary of State of the State of
Delaware.
"Series" shall have the meaning set forth in Section 5.1(a).
"Series Assets" shall have the meaning set forth in Section 5.1(a).
"Series Designation Certificate" shall have the meaning set forth in
Section 5.1(d).
"Specified Series" shall have the meaning set forth in Section 5.1.
"Specified Series Assets" shall mean the Company Assets which have been
assigned or allocated to a Specified Series.
"Standard & Poor's" shall mean Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc.
"Transfer and Servicing Agreements" has the meaning set forth in
Section 2.4(c).
"Trusts" has the meaning set forth in Section 2.4(c).
7
ARTICLE II
ORGANIZATION
Section 2.1 Formation, Name, Location of Office. The Member
hereby appoints Xxxx Xxxxxxx as its agent (which agent shall also be an
"authorized person" within the meaning of the Act) for the sole purpose of
forming the Company as a limited liability company pursuant to the provisions of
the Act under the name "Ford Credit Auto Receivables Two LLC" by the filing of a
Certificate of Formation (the "Certificate of Formation") with the Delaware
Secretary of State. The business of the Company shall be carried on in such name
with variations and changes as the Board of Managers shall determine or deem
necessary to comply with requirements of the jurisdictions in which the
Company's operations are conducted. The principal place of business of the
Company shall be One American Road, Office of the General Counsel, Xxxxxxxx,
Xxxxxxxx 00000 or such other place or places in the State of Michigan as the
Board of Managers may from time to time designate.
Section 2.2 Registered Office in Delaware. The registered
office of the Company in the State of Delaware is located at 0000 Xxxxxx Xxxxxx,
xx xxx Xxxx xx Xxxxxxxxxx, Xxxxxx of New Castle.
Section 2.3 Registered Agent. The name and address of the
registered agent of the Company for service of process on the Company in the
State of Delaware is The Corporation Trust Company, in the City of Wilmington,
County of New Castle.
Section 2.4 Purposes and Powers. The limited purposes for
which the Company is organized are to engage in the following activities, all in
accordance with the terms of this Agreement:
(a) to acquire from time to time all right, title and interest
in and to receivables or leases arising out of or relating to the sale or lease
of new or used motor vehicles and farm or industrial equipment, including
automobiles, light and heavy duty trucks, tractors and recreational vehicles,
monies due thereunder, security interests in the motor vehicles or equipment
financed thereby, proceeds from claims on insurance policies related thereto,
and related rights (collectively, "Receivables");
(b) to acquire, own, hold, service, sell, assign, pledge and
otherwise deal with the Receivables, collateral securing the Receivables,
related insurance policies, agreements with motor vehicles or equipment dealers
or lessors or other originators or servicers of Receivables and any proceeds or
further rights associated with any of the foregoing;
(c) to transfer Receivables to trusts (the "Trusts") pursuant
to one or more pooling and servicing agreements, sale and servicing agreements
or other agreements (the "Transfer and Servicing Agreements") to be entered into
by and among, among others, the Company, the trustees named therein and any
entity acting as servicer of the Receivables;
(d) to authorize, issue, sell and deliver one or more series
or classes of bonds, notes or other evidences of indebtedness (the "Notes") or
certificates (the "Certificates") or other securities (collectively, the
"Securities") issued through the Trusts under the related Transfer and Servicing
Agreements and secured or collateralized by one or more pools of Receivables or
by certificates of any class issued by one or more trusts established by Ford
Credit or any Affiliate thereof, provided that the Company shall have no
liability under any such Securities except to the extent of the one more pools
of Receivables or certificates securing or collateralizing such Securities and
provided further, that each series of debt issued by a
8
Trust shall bear its own trustee fees and servicer fees;
(e) to acquire from Ford Credit or any Affiliate thereof
certificates issued by one or more trusts to which Ford or any Affiliate thereof
transferred Receivables;
(f) to hold and enjoy all of the rights and privileges of any
Certificates issued by the Trusts to the Company under the related Transfer and
Servicing Agreements and to hold and enjoy all of the rights and privileges of
any class of Notes, including any class of Notes or Certificates which may be
subordinated to any other class of Notes or Certificates;
(g) to perform its obligations under the Transfer and
Servicing Agreements and any indenture or other agreement (each, an "Indenture")
pursuant to which any Notes are issued; and
(h) to engage in any activity and to exercise any powers
permitted to limited liability companies under the laws of the State of Delaware
that are related or incidental to the foregoing and necessary, convenient or
advisable to accomplish the foregoing (such business activities and transactions
specified in this Section 2.4 collectively referred to hereinafter as "Permitted
Transactions").
Section 2.5 Conduct of Business.
(a) Notwithstanding any other provision of this Agreement and
any provision of law that otherwise so empowers the Company, the Company shall
not, without the prior written confirmation of each applicable Rating Agency
that such action will result in a Rating Agency Condition, do any of the
following:
(i) engage in any business or activity other than a
Permitted Transaction;
(ii) create, incur or assume any indebtedness or
issue any security or sell or transfer any receivables (including the
Receivables) to a Trust or other Person which issues a security in
respect of any such receivables unless any such indebtedness or
security has no recourse to any assets of the Company other than the
Series Assets to which such indebtedness or security relates and does
not constitute a claim against the Company if cash flow from the Series
Assets securing or collateralizing such indebtedness or security is
insufficient to repay the debt;
(iii) create, incur or assume any indebtedness or
issue any security or sell or transfer any receivables (including the
Receivables) to a Trust or other Person which issues a security in
respect of any such receivables unless the debt holders thereof (A)
agree they have no rights in any other assets of the Company, including
but not limited to, any other Receivables collateralizing other debt
obligations of the Company or sold or transferred to another trust, (B)
agree to not file or join in filing any bankruptcy petition against the
Company prior to the end of the period that is one year and one day
after all of the debt of the Company and all of the debt issued through
the Trusts is paid in full and agree they will not cooperate with or
encourage others to file a bankruptcy petition against the Company
during the same period, (C) agree that to the extent such debt holders
are deemed to have any interest in any assets of the Company or another
Trust dedicated to other debt obligations of the Company or debt
obligations of such other Trust, their interest in those assets will be
subordinate to claims or rights of such other debt holders to those
9
assets and, further, that such agreement will constitute a
subordination agreement for purposes of Section 510(a) of the
Bankruptcy Code;
(iv) become or remain liable, directly or
contingently, in connection with any indebtedness or other liability of
any other Person, whether by guarantee, endorsement (other than
endorsements of negotiable instruments for deposit or collection in the
ordinary course of business), agreement to purchase or purchase,
agreement to supply or advance funds, or otherwise, except in
connection with Permitted Transactions;
(v) make or suffer to exist any loans or advances to,
or extend any credit to, or make any investments (by way of transfer of
property, contributions to capital, purchase of stock or securities or
evidences of indebtedness, acquisition of the business or assets, or
otherwise) in, any Affiliate other than in connection with Permitted
Transactions; provided, however, that the Company shall not be
prohibited under this clause (a)(v) from causing a distribution of cash
to its Member;
(vi) enter into any transaction or merger or
consolidation with or into any other entity, or convey its properties
and assets substantially as an entirety to any entity, other than with
respect to a Permitted Transaction, unless (A) the entity (if other
than the Company) formed as a result of or surviving such consolidation
or merger, or which acquires the properties and assets of the Company
is (i) organized and existing under the laws of the State of Delaware,
(ii) expressly assumes all of the Company's obligations under the Basic
Documents and (iii) is governed under a charter document containing
provisions substantially identical to the provisions of Section 2.4 and
2.5 of this Agreement; (B) the Rating Agencies and the trustees under
the Basic Documents shall have received at least 10 days' prior notice
of any such merger, consolidation or sale of assets; (C) such merger,
consolidation or sale of assets will not conflict with any provisions
of the Certificate of Formation of the Company; and (D) immediately
after giving effect to such merger, consolidation or sale of assets,
no default or event of default by or relating to the Company shall have
occurred and be continuing under any material agreement to which the
Company is a party;
(vii) become party to, or permit any of its
properties to be bound by, any indenture, mortgage, instrument,
contract, agreement, lease or other undertaking, with the exception of
the Basic Documents or any other any documents relating to a Permitted
Transaction; and
(viii) amend, modify, alter, change or repeal any
provision of Section 2.4 or 2.5 of this Agreement; provided, however,
the Company reserves the right to amend, alter, change or repeal any
provision contained in its Certificate of Formation or this Agreement
in a manner now or hereafter prescribed by the Act, and all rights
conferred upon the Member herein are granted subject to this
reservation.
(b) The Company shall at all times:
(i) maintain its existence as a limited liability
company and remain in good standing under the laws of the State of
Delaware;
(ii) observe all corporate procedures required by
this Agreement and such others, if any, as may be from time to time
required by the Act;
10
(iii) ensure that (x) the business and affairs of the
Company are at all times managed by or under the direction of the Board
of Managers, (y) the Board of Managers shall have duly authorized all
actions requiring such authorization and, (z) when required by law or
by this Agreement, the Company shall have obtained the proper
authorization for action from its Member;
(iv) maintain the Company's books, financial
statements, accounting records and other corporate documents and
records separate from those of the Member, any Affiliate thereof or any
other entity;
(v) not commingle the Company Assets with those of
the Member or any Affiliate thereof, and not hold itself out as being
liable for the debts of another;
(vi) maintain its bank accounts, books of account and
payroll (if any) separate from those of its Affiliates, the Member or
any of the Member's Affiliates or any other Person or entity; and
ensure that its funds and other assets shall at all times be readily
distinguishable from the funds and other assets of its Affiliates, the
Member and any of the Member's Affiliates or any other Person or
entity;
(vii) act solely in its corporate name and through
its own managers and agents so as not to mislead others as to its
identity or the identity of any Affiliate and correct any known
misunderstanding regarding its separate identity, and conduct all oral
and written communications of the Company, including without limitation
letters, invoices, contracts, statements and applications solely in
the name of the Company;
(viii) separately manage its liabilities from those
of the Member or any Affiliate thereof and pay its own liabilities,
including all administrative expenses, from its own separate assets,
provided that the Member or any Affiliate thereof may pay certain of
the organizational costs of the Company, and the Company shall
reimburse the Member or any such Affiliate for its allocable portion of
shared expenses paid by the Member or such Affiliate, and provided,
further, that the Member may pay fees and expenses and indemnify
parties pursuant to Section 2.5(d);
(ix) at all times maintain an arm's length
relationship with any Affiliates;
(x) not incur any indebtedness other than the
Securities and other obligations permitted pursuant to the Basic
Documents unless such indebtedness is rated by each Rating Agency then
rating the outstanding Notes or certificates at the request of the
Company, or unless such Rating Agencies have confirmed in writing that
the issuance of such indebtedness will not adversely affect the then
current rating of the outstanding Securities;
(xi) operate in such a manner that it would not be
substantively consolidated for purpose of applicable bankruptcy laws
with any other entity;
(xii) have a sufficient number of Managers and any
other authorized agents to manage its operations; and
(xiii) maintain adequate capital in light of its
contemplated
11
business operations.
(c) The Company shall abide by all corporate formalities,
including the maintenance of current minute books, and the Company shall cause
its financial statements to be prepared in accordance with generally accepted
accounting principles in manner that indicates the separate existence of the
Company and its assets and liabilities. The Company shall not assume the
liabilities of the Member or any Affiliate thereof, and shall not guarantee the
liabilities of the Member or any Affiliate thereof. The Board of Managers of the
Company shall make decisions with respect to the business and operations of the
Company independent of, and not dictated by, the Member or any Affiliate
thereof.
(d) Notwithstanding any provision in this Agreement to the
contrary, the Member in its own capacity (i) may pay fees and expenses of and
indemnify trustees relating to the Trusts and (ii) may indemnify any
underwriter, placement agent, initial purchaser for resale or other Person
performing similar functions in connection with the issuance of any Securities.
Section 2.6 Tax Reporting and Characterization. It is the
Member's express intention that the Company not constitute a separate entity for
purposes of federal income tax or state or local income, franchise or other
taxes.
Section 2.7 Term. Subject to the provisions of Section
4.3(c)(iii) below, the Company shall have perpetual existence.
ARTICLE III
THE MEMBER
Section 3.1 The Member. The name and address of the Member is
as follows:
Ford Motor Credit Company
World Headquarters
Office of the General Counsel
Xxx Xxxxxxxx Xxxx
Xxxxx 0000-X0
Xxxxxxxx, XX 00000
Section 3.2 Powers of Member. The Member (acting in its
capacity as such) shall have the authority to take all actions specifically
enumerated in the Certificate of Formation or this Agreement.
Section 3.3 Limited Liability of the Member. Unless otherwise
expressly provided in any Basic Document, all debts, obligations and liabilities
of the Company, whether arising in contract, tort or otherwise, shall be solely
the debts, obligations and liabilities of the Company, and the Member shall not
be obligated personally for any such debt, obligation or liability of the
Company solely by reason of being a member.
ARTICLE IV
MANAGEMENT OF THE COMPANY;
THE BOARD OF MANAGERS; OFFICERS
Section 4.1 General Management of the Company. Subject to such
matters which are expressly reserved hereunder or under the Act to the Member
for decision, the business, properties and affairs of the Company shall be
managed by a board of managers (the "Board of Managers") which, without limiting
the generality of the foregoing, shall have the power to appoint officers of the
Company, to appoint and direct agents, to grant general or limited authority to
officers, employees and agents of the Company, and to make, execute and deliver
contracts and other
12
instruments and documents in the name and on behalf of the Company.
Section 4.2 Appointment and Term. The Member shall be entitled
to appoint from time to time persons to serve as the managers (each, a
"Manager") on the Board of Managers. Managers shall serve until their respective
successors are appointed by the Member or until their earlier death, disability,
resignation, retirement or removal.
Section 4.3 Number; Independent Managers.
(a) The number of Managers which shall constitute the whole
Board of Managers shall be not less than three nor more than five. The number
may be increased or reduced from time to time by amendment of this Agreement.
The initial Board of Managers shall consist of three individuals, who shall be:
Xxxxxxx Xxxxxx
Xxxxx X. Xxxxxx
Xxxxxxx Xxxxxxx
(b) The Board of Managers of the Company shall include at
least two Managers who are Independent Managers (i) at all times during the
existence of a Rating Event (ii) at any time an action is taken which requires
the unanimous consent or vote of the Board of Managers pursuant to this Section
4.3(b) or Section 4.3(c) of this Agreement. So long as any Securities are
outstanding, this Section 4.3(b) shall not be amended without the prior written
consent of at least two Independent Managers. When voting on matters subject to
the vote of the Board of Managers, including those matters specified in Section
4.3(c), notwithstanding that the Company is not then insolvent, the Independent
Managers shall take into account the interests of the creditors of the Company
and the Trusts as well as the interests of the Company. Except as provided in
Section 4.3(c), any action permitted or required to be taken by the Board of
Managers may be taken by a simple majority of the members of the Board of
Managers; provided, however, that the Board of Managers may delegate the
day-to-day management of the Company to an individual or entity which may or may
not be a Manager. The actions set forth in Section 4.3(c) shall be the only
actions by the Board of Managers that shall require the affirmative vote of 100%
of the Board of Managers.
For purposes of this Section 4.3(b) the following terms shall
have the meanings set forth below:
(i) An "Independent Manager" shall be an individual
who: (A) is not and has not been employed by Ford Credit or any of its
Affiliates as a director, officer or employee within the five years
immediately prior to such individual's appointment as an Independent
Manager; (B) is not and has not been affiliated with a significant
customer or supplier of Ford Credit or any of its Affiliates within the
five years immediately prior to such individual's appointment as an
Independent Manager; (C) is not and has not been affiliated with a
company of which Ford Credit or any of its Affiliates is a significant
customer or supplier within the five years immediately prior to such
individual's appointment as an Independent Manager; (D) does not have
and has not had significant personal services contract(s) with Ford
Credit or any of its Affiliates within the five years immediately prior
to such individual's appointment as an Independent Manager; (E) is not
affiliated with a tax-exempt entity that receives significant
contributions from Ford Credit or any of its Affiliates within the five
years immediately prior to such individual's appointment as an
Independent Manager; (F) is not the beneficial owner at the time of
such individual's appointment as an Independent Manager, or at any
13
time thereafter while serving as an Independent Manager, of such number
of shares of any class of common stock of Ford Credit or any Affiliate
the value of which constitutes more than 3% of such individual's net
worth; (G) is not a spouse, parent, sibling or child of any person
described by (A) through (F); and (H) is not and was not a major
creditor of Ford Credit or any of its Affiliates within the five years
prior to such appointment as an Independent Manager.
(ii) A "significant customer of Ford Credit or any of
its Affiliates" shall mean a customer from which Ford Credit and any of
its Affiliates collectively in the last fiscal year of Ford Credit
received payments in consideration for the products and services of
Ford Credit and its Affiliates which are in excess of 1% of the
consolidated gross revenues of Ford Credit and its Affiliates during
such fiscal year.
(iii) A "significant supplier of Ford Credit or any
of its Affiliates" shall mean a supplier to which Ford Credit and any
of its Affiliates collectively in the last fiscal year of Ford Credit
made payments in consideration for the supplier's products and services
in excess of 3% of the consolidated gross revenues of Ford Credit and
its Affiliates during such fiscal year.
(iv) Ford Credit or any of its Affiliates shall be
deemed a "significant customer" of a company if Ford Credit and any of
its Affiliates collectively were the direct source during such
company's last fiscal year in excess of 3% of the gross revenues which
such company received from the sale of its products and services during
such fiscal year.
(v) Ford Credit or any of its subsidiaries and
affiliates shall be deemed a "significant supplier" of a company if
Ford Credit and any of its Affiliates collectively received in such
company's fiscal year payments from such company in excess of 3% of
the gross revenues which such company received during such fiscal year
for the sale of its products and services.
(vi) A Person shall be deemed to have "significant
personal services contract(s) with Ford Credit or any of its
Affiliates" if the fees and other compensation received by the person
pursuant to personal services contract(s) with Ford Credit and any of
its Affiliates exceeded or would exceed 3% of his or her gross revenues
during the last calendar year.
(vii) A tax-exempt entity shall be deemed to receive
"significant contributions from Ford Credit or any of its Affiliates"
if such tax-exempt entity received during its last fiscal year, or
expects to receive during its current fiscal year, contributions from
Ford Credit or its Affiliates in excess of the lesser of (i) 3% of the
consolidated gross revenues of Ford Credit and its Affiliates during
such fiscal year and (ii) 1% of the contributions received by the
tax-exempt entity during such fiscal year.
(viii) A person shall be deemed to be a "major
creditor of Ford Credit or any of its Affiliates" if it is a financial
institution which Ford Credit or such Affiliate owes outstanding
indebtedness for borrowed money in a sum exceeding more than 5% of Ford
Credit's total consolidated assets.
(c) Notwithstanding any other provision of this Agreement and
any provision of law that otherwise so empowers the Company, the Company shall
not, without the affirmative vote of 100% of the members of the Board of
Managers, do any of the following:
(i) amend Section 2.4 to permit the Company to engage
in any business or activity other than those set forth in Section 2.4
prior to any
14
such amendment;
(ii) engage in any business or activity other than
those set forth in Section 2.4;
(iii) dissolve or liquidate, in whole or in part,
consolidate or merge with or into any other entity or convey or
transfer its properties and assets substantially as an entirety to any
entity; or
(iv) institute proceedings to be adjudicated bankrupt
or insolvent, or consent to the institution of bankruptcy or insolvency
proceedings against it or file a petition seeking, or consent to,
reorganization or relief under any applicable federal or state law
relating to bankruptcy, or consent to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator or other similar official
of the Company or a substantial part of its property, or make any
assignment for the benefit of creditors, or admit in writing its
inability to pay its debts generally as they become due, or take
corporate action in furtherance of any such action.
(d) Meetings of the Board of Managers may be conducted in
person or by conference telephone facilities. Any action required or permitted
to be taken at any meeting of the Board of Managers may be taken without a
meeting if such number of Managers sufficient to approve such action pursuant to
the terms of this Agreement consent thereto in writing.
Section 4.4 Power to Bind Company. None of the Managers
(acting in their capacity as such) shall have authority to bind the Company to
any third party with respect to any matter unless the Board of Managers shall
have approved such matter and authorized such Manager(s) to bind the Company
with respect thereto.
Section 4.5 Restrictions on the Power of the Managers. The
Board of Managers shall not have the authority to:
(a) cause the Company to do any acts in violation of or in
breach of any Basic Document or any other agreement entered into by the Company;
(b) take any action in contravention of the Act, the
Certificate of Formation or this Agreement (each as may be amended);
(c) take any action that would make it impossible to carry on
the ordinary business of the Company;
(d) admit any Person as a member of the Company;
(e) knowingly perform any act that would subject the Member to
loss of limited liability in any jurisdiction; or
(f) except as permitted under Section 9.2, take any action to
amend or modify the Certificate of Formation or this Agreement.
Section 4.6 Duties and Obligations of the Managers.
(a) Subject to Section 4.3(c)(iii), as long as any Securities
are outstanding, the Board of Managers shall take all action that may be
necessary or appropriate for the continuation of the Company's valid existence
as a limited liability
15
company under the laws of the State of Delaware (and each other jurisdiction in
which such existence is necessary to protect the limited liability of the Member
or to enable the Company to conduct the business in which it is engaged).
(b) Each Manager shall devote to the Company such time as he
shall deem necessary to conduct the Company's business and affairs in an
appropriate manner.
(c) The Board of Managers shall use their best efforts, in the
conduct of the Company's activities and business, to put all Persons with whom
the Company deals on notice that the Member is not liable for the Company's
obligations, and all agreements to which the Company is a party shall include a
statement to the effect that the Company is a limited liability company formed
under the Act; provided, however, the failure to include such a statement in an
agreement to which the Company is a party shall not affect the Company's power
and authority or authorization to enter into such agreement.
(d) The Board of Managers shall prepare or cause to be
prepared and shall file or cause to be filed on or before the due date (or any
extension thereof) any federal, state or local tax returns required to be filed
by the Company. The Board of Managers shall cause the Company to pay any taxes
payable by the Company; provided, however, that the Managers shall not be
required to cause the Company to pay any tax so long as the Company is
contesting in good faith and by appropriate legal proceedings the validity,
applicability or amount thereof and such contest does not materially endanger
any right or interest of the Company.
(e) The Board of Managers shall, from time to time, submit, or
cause to be submitted, to any appropriate state securities administrator all
documents, papers, statistics and reports required to be filed with or submitted
to such state securities administrator.
(f) The Board of Managers shall use their best efforts to
cause the Company to be formed, reformed, or qualified to engage in investment
activities, or be registered under any applicable assumed or fictitious name
statute or similar law in any state in which the Company then makes investments
or transacts business, if such formation, reformation, qualification or
registration is necessary or desirable in order to protect the limited liability
of the Member or to permit the Company lawfully to own or make investments or
transact business.
(g) The Board of Managers, as an "authorized person" within
the meaning of the Act shall from time to time, prepare and file, or cause to be
prepared and filed, any amendment or restatement to the Certificate of Formation
or this Agreement and other similar documents that are required by law to be
filed and recorded for any reason, in such office or offices as are required
under the laws of the State of Delaware or any other state in which the Company
is then formed or qualified.
Section 4.7 Resignation. Any Manager may resign at any time
upon written notice of resignation to the Member. Any resignation shall be
effective immediately unless a date certain is specified for it to take effect,
in which event it shall be effective upon such date, and acceptance of any
resignation shall not be necessary to make it effective, irrespective of whether
the resignation is tendered subject to such acceptance.
Section 4.8 Removal of Managers. Any Manager may be removed,
either for or without cause, by the Member.
16
Section 4.9 Filling of Vacancies. In the case of any increase
in the number of Managers, or of any vacancy in the Board of Managers, the
additional Manager shall be appointed by the Member.
Section 4.10 Managers' Compensation. Any or all Managers may
receive such reasonable compensation for their services, whether in the form of
salary or otherwise, with expenses, if any, as the Board of Managers and the
Member may from time to time determine.
Section 4.11 Officers. (a) The Board of Managers, by a simple
majority, may from time to time appoint authorized officers of the Company who
may, on behalf of the Company, execute agreements to which the Company is a
party and any document or certificate to be delivered in connection herewith or
pursuant hereto.
(b) Each authorized officer shall have the right and authority
to take all actions specifically enumerated in the Certificate of Formation or
this Agreement which may be taken by the Company or which the authorized officer
otherwise deems necessary, useful or appropriate for the day-to-day management
and conduct of the Company's business. All instruments, contracts, agreements
and documents providing for the acquisition, mortgage or disposition of property
of the Company shall be valid and binding on the Company only if executed by an
authorized officer of the Company.
ARTICLE V
THE SERIES
Section 5.1 Series. (a) Immediately upon the acquisition
thereof by the Company, Company Assets shall be allocated to, and identified
only with, a series under this Agreement (each such series, a "Series", and the
assets allocated to each such Series, "Series Assets"). Each Series shall be a
separate series of the Company pursuant to Section 18-215(a) of the Act. A
separate Series shall be established with respect to the Receivables and related
property which the Company assigns to each Trust pursuant to the related
Transfer and Servicing Agreements (each, a "Specified Series"). All Company
Assets not allocated to a Specified Series, including any Securities held by the
Company, shall be allocated to the General Series unless otherwise directed by
the Board of Managers. The Board of Managers shall cause the Company to account
for and record separately all Series Assets and the proceeds thereof allocated
to any Series from the Series Assets and the proceeds thereof allocated to any
other Series. The Board of Managers shall cause the Company to maintain separate
and distinct records for the Series Assets related to each Series and to hold
and account for the Series Assets related to each Series separately from the
Series Assets related to any other Series. Except to the extent required by law
or specified in this Agreement, the debts, liabilities and expenses incurred,
contracted for or otherwise existing with respect to any Series shall be
enforceable against the related Series Assets, and not against the assets of the
General Series or any other Specified Series, and, except to the extent required
by law or specified in this Agreement, none of the debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing with
respect to the Company generally shall be enforceable against any Specified
Series Assets.
(b) Notice of the limitation on interseries liabilities
between Series applicable to each Series and the Series Assets has been set
forth in the Certificate of
17
Formation as filed in the office of the Secretary of State pursuant to Section
18-215(b) of the Act. It is the express intent that by giving such notice in the
Certificate of Formation, the statutory provisions of Section 18-215(b) of the
Act relating to limitations on interseries liabilities will apply to the Company
and the Series Assets that relate to each Series. The limitation on interseries
liabilities is included in the Certificate of Formation as filed with the
Secretary of State in the form attached hereto as Exhibit A.
(c) Every Security, contract and other undertaking issued by
or on behalf of any Series shall include a recitation limiting the obligation
represented thereby to the related Series and the related Series Assets. Any
such Security, contract or undertaking, whether secured or unsecured, shall also
include an acknowledgment and agreement by the holder thereof to the effect that
any claim that such holder may have at any time against any assets of the
Company that are allocated to an unrelated Series, and any claim that such
holder may have at any time against the Company that such holder may seek to
enforce against any assets of the Company that are allocated to an unrelated
Series, shall be subordinate to the payment in full, including post- petition
interest, in the event that the Company becomes subject to an Insolvency Event,
of the claims of the holders of any Securities that are related to such
unrelated Series and the holders of any other Securities, contracts or other
obligations that are related to such unrelated Series.
Section 5.2 Series Designation Certificates. (a) The Series to
which any Company Assets shall be allocated shall be specified in a certificate
(each, a "Series Designation Certificate") executed by an authorized Manager or
agent. Each Series Designation Certificate shall include the following:
(i) a designation of the Series to which the Company
Assets are to be allocated, which shall be in form and substance
sufficient to allow the Company to differentiate between the Series to
which the Company Assets are to be allocated and any other Series;
(ii) the date on which the Company Assets to be
allocated to such Series are to be transferred to the Company and
allocated to such Series; and
(iii) a list of the Company Assets to be allocated to
the Series, which shall identify the Company Assets in such a manner as
may be reasonably required by the Company to differentiate between such
Company Assets allocated to such Series and any other Company Assets.
ARTICLE VI
CAPITAL STRUCTURE AND CONTRIBUTIONS
Section 6.1 Capital Structure. (a) Simultaneously with the
execution and delivery of this Agreement, Ford Credit shall be admitted as the
sole member of the Company with an interest of 100% (as such percentage may
change from time to time, a "Percentage Interest").
Section 6.2 Capital Contributions. From time to time, the
Board of Managers may determine that the Company requires capital and may
request the Member to make capital contributions in an amount determined by the
Board of Managers. A capital account shall be maintained for the Member, to
which contributions and profits shall be credited and against which
distributions and losses shall be charged.
18
ARTICLE VII
PROFITS AND LOSSES; DISTRIBUTIONS
Section 7.1 Profits and Losses. For financial accounting and
tax purposes, the Company's net profits or net losses shall be determined on an
annual basis in accordance with the manner determined by the Board of Managers.
In each year, profits and losses shall be allocated entirely to the Member.
Section 7.2 Distributions. At the time determined by a
majority of the Managers, the Managers shall cause the Company to distribute any
cash held by it which is neither reasonably necessary for the operation of the
Company or the performance of its obligations under the Basic Documents nor in
violation of Sections 18-607 or 18-804 of the Act or in connection with any
Permitted Transactions. The distributions of the Company shall be allocated
entirely to the Member.
ARTICLE VIII
EXCULPATION; LIABILITIES: INDEMNIFICATION
Section 8.1 Exculpation. Notwithstanding any other provisions
of this Agreement, whether express or implied, or obligation or duty at law or
in equity, none of the Member, the Managers, or any officers, directors,
stockholders, partners, employees, representatives or agents of any of the
foregoing, nor any officer, employee, representative or agent of the Company or
any of its Affiliates shall be liable to the Company or any other Person for any
act or omission (in relation to the Company, this Agreement, any related
document or any transaction contemplated hereby or thereby) taken or omitted by
such Person in the reasonable belief that such act or omission is in or not
contrary to the best interests of the Company and is within the scope of
authority granted to such Person by the Agreement, provided such act or omission
does not constitute fraud, willful misconduct, bad faith, or gross negligence.
Section 8.2 Liabilities: Indemnification. (a) Subject to
Section 8.2(f), any Person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, by reason of the fact
that he is or was a Member, Manager, officer, employee, agent or legal
representative of the Company (each, an "Indemnified Party"), shall be
indemnified and held harmless by the Company to the fullest extent legally
permissible against all expenses, claims, damages, liabilities and losses
(including without limitation, judgments, interest on judgments, fines, charges,
costs, amounts paid in settlement, expenses and attorneys' fees incurred in
investigating, preparing or defending any action, claim suit, inquiry,
proceeding, investigation or any appeal taken from the foregoing by or before
any court or governmental, administrative or other regulatory agency, body or
commission), whether pending or merely threatened, whether or not any
Indemnified Party is or may be a party thereto, including interest on any of
the foregoing (collectively, "Damages") arising out of, or in connection with,
the management or conduct of the business and affairs of the Company, except for
any such Damages to the extent that they are found by a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct
of the Indemnified Parties or willful violations of the express provisions
hereof by the Indemnified Parties. The Indemnified Parties may consult with
counsel and accountants with respect to the affairs of the Company and shall be
fully protected and justified, to the extent allowed by law, in acting, or
failing to act, if such action or failure to act is in accordance with the
advice or opinion of such counsel or accountants.
(b) The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the Person
seeking indemnification did not act in good faith and in a manner which such
Person reasonably believed to be in or not
19
opposed to the best interest of the Company, and, with respect to any criminal
action or proceeding, had reasonable cause to believe that such Person's conduct
was unlawful. Entry of a judgment by consent as part of a settlement shall not
be deemed a final adjudication of liability for negligence or misconduct in the
performance of duty, nor of any other issue or matter.
(c) Subject to Section 8.2(f), expenses (including attorneys'
fees and disbursements) incurred by a Manager, employee or agent of the Company
in defending any civil, criminal, administrative or investigative action, suit
or proceeding may be paid by the Company in advance of the final disposition of
such action, suit or proceeding as authorized by the Board of Managers in the
specific case upon receipt of an undertaking by or on behalf of such Manager,
employee or agent to repay such amount unless it shall ultimately be determined
that such Person is entitled to be indemnified by the Company. Expenses
(including attorneys' fees and disbursements) incurred by other employees or
agents of the Company in defending in any civil, criminal, administrative or
investigative action, suit or proceeding may be paid by the Company upon such
terms and conditions, if any, as the Board of Managers deems appropriate.
(d) No Manager of the Company shall be personally liable to
the Company for monetary damages for any breach of fiduciary duty by such person
as a Manager. Notwithstanding the foregoing sentence, a Manager shall be liable
to the extent provided by applicable law (i) for breach of the Manager's duty of
loyalty to the Company or the Member, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law or
(iii) for any transaction from which the Manager derived an improper personal
benefit.
(e) The indemnification and advancement of expenses provided
by this Section 8.2 shall not be deemed exclusive of any other rights to which
those seeking indemnification or advancement may by entitled under any
agreement, vote of the Board of Managers or otherwise, both as to action in an
official capacity and as to action in another capacity while holding such
office, and shall continue as to a Person who has ceased to be a Manager,
employee or agent and shall inure to the benefit of the heirs, executors and
administrators of such Person.
(f) Any amounts payable by the Company in accordance with this
Section 8.2 shall be payable solely to the extent of funds (i) available
therefor from such Series specified in any applicable written agreement with
such Indemnified Party or, if no such written agreement exists, from the General
Series and (ii) actually received by the Company under the Basic Documents, from
capital contributions or in connection with other Permitted Transactions. The
Company's obligations under this Section 8.2 shall not constitute a claim
against the Company to the extent that the Company does not have funds
sufficient to make payment of such obligations. Any claim that an Indemnified
Party may have at any time against the Company that it may seek to enforce
against the Series Assets of any Series unrelated to indemnification obligations
hereunder shall be subordinate to the payment in full, including post-petition
interest, in the event that the Company becomes a debtor or debtor in possession
in a case under any applicable federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect or otherwise subject to any insolvency,
reorganization, liquidation, rehabilitation or other similar proceedings, of the
claims of the holders of any Securities related to such unrelated Series and the
holders of any other notes, bonds, contracts or other obligations that are
related to such unrelated Series.
Section 8.3 Amendments: Indemnification. The indemnities
20
contained in Section 8.2 shall survive the resignation, removal or termination
of any Indemnified Party or the termination of this Agreement. Any repeal or
modification of this Article VII shall not adversely affect any rights of such
Indemnified Party pursuant to this Article VII, including the right to
indemnification and to the advancement of expenses of an Indemnified Party
existing at the time of such repeal or modifications with respect to any acts or
omissions occurring prior to such repeal or modification.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Bankruptcy of the Member. If any event of
bankruptcy specified in Section 18-304(a) of the Act shall occur with respect
the Member, then the Member shall, notwithstanding the occurrence of such event
of bankruptcy, remain a Member of the Company and, notwithstanding such event of
bankruptcy, the Company shall continue, subject to the provisions of Section
4.3(c)(iii).
Section 9.2 Amendments. Except as provided in Section 4.6(g)
with respect to amendments required by law, this Agreement and the Certificate
of Formation may be amended only in writing by the Member existing at the time
of this Agreement, provided that, if any Securities issued by any Trusts are
outstanding, no such amendment shall be effective without satisfaction of the
Rating Agency Condition; provided, further, that the provisions of Section
4.3(c) hereof may be amended only with the unanimous written consent of the
Board of Managers. An amendment shall become effective as of the date specified
in the approval of the Member or if none is specified as of the date of such
approval or as otherwise provided in the Act.
Section 9.3 Assignments. Pursuant to Section 18-702 of the
Act, the Member may sell, assign or participate its Percentage Interest at any
time without the consent of the Board of Managers, and the assignee of any such
Percentage Interest shall possess all of the rights and obligations of a member
hereunder, and the right to become a member pursuant to Section 18-704 of the
Act.
Section 9.4 Single Member. It is the intent of the Company
that the Member (or the successor Member) shall be the only member and that only
one Member shall exist at any time.
Section 9.5 Admission of New Member. A successor member shall
only be admitted upon the approval of the existing Member.
Section 9.6 Severability. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements, provisions
or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.
Section 9.7 Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
the Member and its successors and permitted assigns, all as herein provided.
Section 9.8 Limited Liability Company. The Member intends to
form a limited liability company and does not intend to form a partnership under
the laws of the State of Delaware or any other laws.
21
Section 9.9 Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
Section 9.10 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAWS THEREOF.
22
IN WITNESS WHEREOF, the undersigned Member has duly executed
this Agreement as of the 29th day of January, 2001.
FORD CREDIT AUTO RECEIVABLES TWO LLC
By: FORD MOTOR CREDIT COMPANY,
as Member
By:
----------------------------------
Name:
Title:
23
EXHIBIT A
CERTIFICATE OF FORMATION
OF
FORD CREDIT AUTO RECEIVABLES TWO LLC
1. The name of the limited liability company is Ford Credit
Auto Receivables Two LLC (the "Company").
2. The address of its registered office in the State of
Delaware is 0000 Xxxxxx Xxxxxx, in the City of Wilmington, County of New Castle.
The name of its registered agent at such address is The Corporation Trust
Company.
3. The Company shall be a series limited liability company and
the debts, liabilities, obligations and expenses incurred, contracted for or
otherwise existing with respect to a particular series shall be enforceable
against the assets of such series only, and not against the assets of the
Company generally or assets allocated to another series.
4. This Certificate of Formation shall become effective on the
29th day of January, 2001.
IN WITNESS WHEREOF, the undersigned has executed this
Certificate of Formation of Ford Credit Auto Receivables Two LLC on this 29th
day of January, 2001.
FORD CREDIT AUTO RECEIVABLES TWO LLC
By: /s/ Xxxx Xxxxxxx
------------------------------
Xxxx Xxxxxxx
Authorized Person
