SCHEDULE to the MASTER AGREEMENT (Multicurrency-Cross Border) dated as of December 16, 2008 between JPMORGAN CHASE BANK, N.A. a national banking association organized under the laws of the United States of America (“Party A”) and HONDA AUTO...
Exhibit 99.6
Execution Copy
SCHEDULE
to the
MASTER AGREEMENT
(Multicurrency-Cross Border)
(Multicurrency-Cross Border)
dated as of December 16, 2008
between
JPMORGAN CHASE BANK, N.A.
a national banking association organized under the laws of the United States of America
a national banking association organized under the laws of the United States of America
(“Party A”)
and
HONDA AUTO RECEIVABLES 2008-2 OWNER TRUST,
a statutory trust organized under the laws of Delaware
a statutory trust organized under the laws of Delaware
(“Party B”)
1
The 2006 ISDA Definitions (the “Definitions”) are incorporated into this Agreement and shall
form part of this Agreement. In the event of any inconsistency among or between any of the
following documents, the relevant document first listed below shall govern: (i) a Confirmation and
any relevant definitions incorporated in such Confirmation; (ii) this Schedule and any relevant
definitions incorporated in this Schedule; (iii) Sections 1 to 14 of this Agreement; and (iv) the
Definitions.
Capitalized terms used herein but not defined in this Agreement or the Definitions shall have
the meanings specified or incorporated in that certain Indenture, dated as of December 1, 2008,
between Party B, as Issuer, and U.S. Bank National Association, as Indenture Trustee (the
“Indenture”).
For the avoidance of doubt, references herein to a particular “Section” of this Agreement are
references to the corresponding sections of the Master Agreement.
In this Agreement:
(a) “Specified Entity” means in relation to Party A for the purpose of:
Section 5(a)(v), | Not Applicable | |||
Section 5(a)(vi), | Not Applicable | |||
Section 5(a)(vii), | Not Applicable | |||
Section 5(b)(iv), | Not Applicable |
in relation to Party B for the purpose of:
Section 5(a)(v), | Not Applicable | |||
Section 5(a)(vi), | Not Applicable | |||
Section 5(a)(vii), | Not Applicable | |||
Section 5(b)(iv), | Not Applicable |
(b) “Specified Transaction” will have the meaning specified in Section 14 of this Agreement.
Section 5(a) | Party A | Party B | ||||
(i) | “Failure to Pay or Deliver”
|
Applicable. | Applicable. | |||
(ii) | “Breach of Agreement”
|
Applicable (except as provided below in Part 1(d)(ii)). | Not Applicable. | |||
(iii) | “Credit Support Default”
|
Applicable (except as provided below in Part 1(d)(ii)). | Applicable (but only to the extent described below in Part 1(d)(i)). | |||
(iv) | “Misrepresentation”
|
Applicable. | Not Applicable. | |||
(v) | “Default Under Specified Transaction” |
Applicable. | Not Applicable. |
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Section 5(a) | Party A | Party B | ||||
(vi) | “Cross-Default”
|
Applicable. | Not Applicable. | |||
(vii) | “Bankruptcy”
|
Applicable. | Applicable (but only to the extent described below in Part 1(f)). | |||
(viii) | “Merger Without Assumption”
|
Applicable. | Applicable. |
(d) (i) Section 5(a)(iii)(1) will apply to Party B in respect of Party B’s obligations
under Paragraphs 3(b) and 8(d) of the Credit Support Annex, dated as of the date hereof,
attached hereto and made a part hereof between Party A and Party B (as from time to time
amended, supplemented or replaced, the “Credit Support Annex”).
(ii) Notwithstanding Sections 5(a)(i) and 5(a)(iii), any failure by Party A to comply
with or perform any obligation to be complied with or performed by Party A under the Credit
Support Annex shall not be an Event of Default unless (A)(i) a Xxxxx’x Second Trigger Event
has occurred and has continued for at least 30 Local Business Days, (ii) such failure does
not consist solely of a failure by Party A to satisfy the S&P Collateralization
Requirements, and (iii) such failure is not remedied on or before the third Local Business
Day after notice of such failure is given to Party A, or (B)(i) an S&P Collateralization
Event has occurred and continued for at least 10 Local Business Days, (ii) such failure does
not consist solely of a failure by Party B to satisfy the Xxxxx’x Collateralization
Requirements, and (iii) such failure is not remedied on or before the third Local Business
Day after notice of such failure is given to Party A.
(e) With respect to Section 5(a)(vi):
“Specified Indebtedness” will have the meaning specified in Section 14, provided that
Specified Indebtedness shall not include deposits received in the course of a party’s
ordinary banking business.
“Threshold Amount” means, with respect to Party A, 3% of the Shareholders’ Equity of the
applicable Relevant Entity, provided that if the Relevant Entity is Party A, then “Threshold
Amount” means 3% of the Shareholders’ Equity of Party A.
“Shareholders’ Equity” means with respect to an entity, at any time, (1) if the Relevant
Entity is a national banking association, the “Total Equity Capital” of the Relevant Entity
(as shown in the most recently filed FFIEC Consolidated Report of Condition for Insured
Commercial and State-Chartered Savings Banks (“Call Report”) Schedule RC- Balance Sheet of
such entity) or (2) for any other entity, the sum (as shown in the most recent annual
audited financial statements of such entity) of (i) its capital stock (including preferred
stock) outstanding, taken at par value, (ii) its capital surplus and (iii) its retained
earnings, minus (iv) treasury stock, each to be determined in accordance with applicable
generally accepted accounting principles.
(f) With respect to Party B only (and the related Confirmations only), the provisions of
Section 5(a)(vii) clauses (2), (7) and (9) will not be applicable as an Event of Default; clause
(3) will not apply to Party B to the extent it refers to any assignment, arrangement or
composition that is effected by or pursuant to the Transaction Documents; clause (4) will not
apply to Party B to the extent that it refers to proceedings or petitions instituted or presented
by Party A or any of its Affiliates; clause (6) will not apply to Party B to the extent that it
refers to (i) any appointment that is contemplated or effected by the Transaction Documents or
(ii) any appointment that Party B has not become subject to; and clause (8) will not apply to
Party B to the extent that it applies to Section 5(a)(vii)(2), (3), (4), (6) and (7) except to the
extent that such provisions are not disapplied with respect to Party B.
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(g) Application of Termination Events. The provisions of Section 5(b) of this Agreement will
apply to Party A and Party B as follows:
Section 5(b) | Party A | Party B | ||||
(i) | “Illegality”
|
Applicable. | Applicable. | |||
(ii) | “Tax Event”
|
Applicable. | Applicable. | |||
(iii) | “Tax Event Upon Merger”
|
Applicable. | Applicable. | |||
(iv) | “Credit Event Upon Merger”
|
Not Applicable. | Not Applicable. |
(h) Section 5(b)(ii) will apply, provided that the words “(x) any action taken by a
taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a
Transaction is entered into (regardless of whether such action is taken or brought with respect to
a party to this Agreement) or (y)” shall be deleted.
(i) Notwithstanding Section 5(b)(iii), Party A shall not be entitled to designate an Early
Termination Date by reason of a Tax Event Upon Merger in respect of which it is the Affected Party.
(j) The “Automatic Early Termination” provision of Section 6(a) will not apply to either Party
A or to Party B.
(k) Payments on Early Termination. For the purpose of Section 6(e) of this Agreement:
Market Quotation will apply and the Second Method will apply; provided, however, if an Early
Termination Date is designated in respect of (A) an Event of Default with respect to which
Party A is a Defaulting Party or (B) an Additional Termination Event with respect to which
Party A is the sole Affected Party (other than Illegality or Tax Event), notwithstanding
Section 6 of this Agreement, the following amendment to the Agreement set forth in
paragraphs (i) to (vii) below shall apply:
(i) The definition of “Market Quotation” shall be deleted in its entirety and replaced
with the following:
“Market Quotation” means, with respect to one or more Terminated Transactions, a Firm Offer
which is (1) made by an Eligible Replacement, (2) for an amount that would be paid to Party
B (expressed as a negative number) or by Party B (expressed as a positive number) in
consideration of an agreement between Party B and such Eligible Replacement to enter into a
transaction (the “Replacement Transaction”) that would have the effect of preserving for
Party B the economic equivalent of any payment or delivery (whether the underlying
obligation was absolute or contingent and assuming the satisfaction of each applicable
condition precedent) by the parties under Section 2(a)(i) in respect of such Terminated
Transaction or group of Terminated Transactions that would, but for the occurrence of the
relevant Early Termination Date, have been required after that date, (3) made on the basis
that Unpaid Amounts in respect of the Terminated Transaction or group of Terminated
Transactions are to be excluded but, without limitation, any payment or delivery that would,
but for the relevant Early Termination Date, have been required (assuming satisfaction of
each applicable condition precedent) after that Early Termination Date is to be included and
(4) made in respect of a Replacement Transaction with terms substantially the same as those
of this Agreement (save for the exclusion of provisions relating to Transactions that are
not Terminated Transactions).
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(ii) The definition of “Settlement Amount” shall be deleted in its entirety and
replaced with the following:
“Settlement Amount” means, with respect to any Early Termination Date, an amount (as
determined by Party B) equal to the Termination Currency Equivalent of the amount (whether
positive or negative) of any Market Quotation for the relevant Terminated Transaction or
group of Terminated Transactions that is accepted by Party B so as to become legally
binding, provided that:
(A) If, on or before the day falling ten Local Business Days after the day
on which the Early Termination Date is designated (or such later day as
Party B may specify in writing to Party A) but in either case no later than
the Early Termination Date (such day, the “Latest Settlement Amount
Determination Day”), no Market Quotation for the relevant Terminated
Transaction or group of Terminated Transactions has been accepted by Party B
so as to become legally binding and one or more Market Quotations have been
made and remain capable of becoming legally binding upon acceptance, the
Settlement Amount shall equal the Termination Currency Equivalent of the
amount (whether positive or negative) of the lowest of such Market
Quotations (for the avoidance of doubt, (i) a Market Quotation expressed as
a negative number is lower than a Market Quotation expressed as a positive
number, and (ii) the lower of two Market Quotations expressed as negative
numbers is the one with the larger absolute value); and
(B) If, on the Latest Settlement Amount Determination Day, no Market
Quotation for the relevant Terminated Transaction or group of Terminated
Transactions is accepted by Party B so as to become legally binding on or
before the Latest Settlement Amount Determination Day, and no Market
Quotations have been made and remain capable of becoming legally binding
upon acceptance, the Settlement Amount shall equal Party B’s Loss (whether
positive or negative and without reference to any Unpaid Amounts) for the
relevant Terminated Transaction or group of Terminated Transactions.
(iii) For the purpose of clause (4) of the definition of Market Quotation, Party B
shall determine in its sole discretion, acting in a commercially reasonable manner, whether
a Firm Offer is made in respect of a Replacement Transaction with terms substantially the
same as those of this Agreement (save for the exclusion of provisions relating to
Transactions that are not Terminated Transactions).
(iv) At any time on or before the Latest Settlement Amount Determination Day at which
two or more Market Quotations remain capable of becoming legally binding upon acceptance,
Party B shall be entitled to accept only the lowest of such Market Quotations (for the
avoidance of doubt, (i) a Market Quotation expressed as a negative number is lower than a
Market Quotation expressed as a positive number, and (ii) the lower of two Market Quotations
expressed as negative numbers is the one with the larger absolute value).
(v) Party B will be deemed to have discharged its obligations to obtain Market
Quotations above if it requests Party A to obtain Market Quotations, where such request is
made in writing within two Local Business Days after the day on which the Early Termination
Date is designated.
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(vi) If Party B requests Party A in writing to obtain Market Quotations, Party A shall
use its reasonable efforts to do so before the Latest Settlement Amount Determination Day.
(vii) If the Settlement Amount is a negative number, Section 6(e)(i)(3) of this
Agreement shall be deleted in its entirety and replaced with the following:
“Second Method and Market Quotation. If Second Method and Market Quotation apply, (1) Party
B shall pay to Party A an amount equal to the absolute value of the Settlement Amount in
respect of the Terminated Transactions, (2) Party B shall pay to Party A the Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and (3) Party A shall pay to
Party B the Termination Currency Equivalent of the Unpaid Amounts owing to Party B; provided
that, (i) the amounts payable under (2) and (3) shall be subject to netting in accordance
with Section 2(c) of this Agreement and (ii) notwithstanding any other provision of this
Agreement, any amount payable by Party A under (3) shall not be netted-off against any
amount payable by Party B under (1).”
(l) “Termination Currency” means United States Dollars.
(m) Additional Termination Event will apply. Each of the following events shall constitute
an Additional Termination Event hereunder:
(i) An amendment and/or supplement to any Transaction Document is made without the
prior written consent of Party A if such consent is required under such Transaction Document
and such amendment and/or supplement would materially and adversely affect Party A. For
purposes of Section 6 of this Agreement, Party B shall be the sole Affected Party.
(iii) [RESERVED].
(iv) Following an S&P Collateralization Event, the Relevant Entity shall fail to take
action that satisfies Part 5(l)(B) hereof within the time period specified in Part 5(l)(B)
(provided that the occurrence of any such Additional Termination Event shall have no effect
on Party A’s duty to perform its obligations hereunder prior to actual termination of this
Agreement), in which event Party A shall be the sole Affected Party.
(v) Party A fails to comply with or perform any obligation to be complied with or
performed by Party A in accordance with the Credit Support Annex and either (x) the Xxxxx’x
Second Trigger Event has not occurred or (y) the Xxxxx’x Second Trigger Event has occurred
but has been continuing for less than 30 Local Business Days. For purposes of Section 6 of
this Agreement, Party A shall be the sole Affected Party.
(vi) A Xxxxx’x Second Trigger Event has occurred and has been continuing for at least
30 Local Business Days, and (i) at least one Eligible Replacement has made a Firm Offer to
be the Transferee under Part 5(k)(ii) below (but only if such Firm Offer then remains
capable of becoming legally binding upon acceptance) and/or (ii) at least one Eligible
Replacement has
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made a Firm Offer that would, assuming the occurrence of an Early Termination Date, qualify
as a Market Quotation (on the basis that paragraphs (i) and (ii) in Part 1(k) above apply)
and that remains capable of becoming legally binding upon acceptance. For purposes of
Section 6 of this Agreement, Party A shall be the sole Affected Party.
(n) Party A shall be responsible for any costs reasonably incurred by Party B in connection
with any assignment of this Agreement made by Party A by reason of any S&P Collateralization Event,
Xxxxx’x First Trigger Event or Xxxxx’x Second Trigger Event having occurred.
It is not required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any deduction or
withholding for or on account of any Tax from any payment (other than interest under Section
2(e), 6(d)(ii), or 6(e) of this Agreement) to be made by it to the other party under this
Agreement. In making this representation, it may rely on (i) the accuracy of any
representations made by the other party pursuant to Section 3(f) of this Agreement, (ii) the
satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement,
and the accuracy and effectiveness of any document provided by the other party pursuant to
Section 4(a)(i) or 4(a)(iii) of this Agreement, and (iii) the satisfaction of the agreement
of the other party contained in Section 4(d) of this Agreement; provided that it shall not
be a breach of this representation where reliance is placed on clause (ii) and the other
party does not deliver a form or document under Section 4(a)(iii) by reason of material
prejudice to its legal or commercial position.
(b) Payee Tax Representations. For the purposes of Section 3(f) of this Agreement, Party A
and Party B make the following representations:
(A) The following representation applies to Party A: Party A is a United States
Person.
(B) The following representation applies to Party B: Party B is a trust organized
under the laws of Delaware, is a U.S. trust (as such term is used in U.S. Treasury
Regulations Section 1.441-5(b)) and its taxpayer identification number is 00-0000000.
For the purpose of Section 4(a)(i) and (ii) of this Agreement, each Party agrees to deliver the
following documents as applicable:
(a) Tax forms, documents or certificates to be delivered are:
Party B agrees to complete, execute, and deliver to Party A a valid United States Internal
Revenue Service Form W-9, or any successor to such form, and any required attachments
thereto (i) upon execution and delivery of this Agreement, (ii) promptly upon reasonable
demand by Party A, and (iii) promptly upon learning that any such form(s) previously
provided by Party B has become obsolete or is incorrect.
(b) Other documents to be delivered are:
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Party required | Covered by | |||||
to deliver | Date by which | Section 3(d) | ||||
document | Form/Document/Certificate | to be delivered | Representation | |||
Party A/Party B | Credit Support Document,
if any, specified in
Part 4 hereof, such
Credit Support Document
being duly executed if
required.
|
Upon execution and delivery of this Agreement. | Yes. | |||
Party A | Incumbency certificate
or other documents
evidencing the authority
of the persons executing
this Agreement and the
related Confirmations on
Party A’s behalf.
|
On the Closing Date. | Yes | |||
Party B | Monthly statement
setting forth the
information specified in
Section 4.10 of the Sale
and Servicing Agreement.
|
To be made available to Party A on the 15th day of each month. | Yes | |||
Party B | Each of (i) a copy of
the Indenture and the
other Transaction
Documents, executed and
delivered by the parties
thereto and (ii) an
incumbency certificate
or other documents
evidencing the authority
of the persons executing
this Agreement and the
related Confirmations on
Party B’s behalf.
|
On the Closing Date. | Yes | |||
Party A/Party B | Each of an (i) opinion
of counsel to Party A
(which may include
in-house counsel), in
form and substance
reasonably satisfactory
to Party B and (ii)
opinion of counsel to
Party B, in form and
substance reasonably
satisfactory to Party A.
|
On the Closing Date. | No | |||
Party A | Annual Report of Party A
containing consolidated
financial statements
certified by independent
certified public
accountants and prepared
in accordance with
generally accepted
accounting principles in
the country in which
Party A is organized.
|
Promptly upon request after becoming publicly available. | Yes |
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(a) Addresses for Notices: For the purpose of Section 12(a) of this Agreement, all notices to
Party A shall, with respect to any particular Transaction, be sent to the address, telex number or
facsimile number specified in the relevant Confirmation and any notice for purposes of Sections 5
or 6 of this Agreement shall be sent to the address or telex number specified below:
JPMorgan Chase Bank, N.A. | ||||
Attention Legal Department- Derivatives Practice Group | ||||
000 Xxxx Xxxxxx, 00xx Xxxxx | ||||
Xxx Xxxx, Xxx Xxxx 00000-0000 | ||||
Telex No.: 232337; Answerback: CBC UR | ||||
Facsimile No.: (000) 000-0000 | ||||
Address for notices or communications to Party B (for all purposes): | ||||
Honda Auto Receivables 2008-2 Owner Trust | ||||
c/o American Honda Finance Corporation, as Administrator | ||||
00000 Xxxxxxx Xxxxxx | ||||
Xxxxxxxx, XX 00000 | ||||
Attention: Treasury Manager | ||||
With a copy to Standard & Poor’s: | ||||
Address: | Standard & Poor’s, A Division of The XxXxxx-Xxxx Companies, Inc. | |||
00 Xxxxx Xxxxxx, 00xx Xxxxx | ||||
Xxx Xxxx, Xxx Xxxx 00000 | ||||
Facsimile No.: | (000) 000-0000 | |||
Attention: | Structured Finance Ratings, Asset-Backed Surveillance Group | |||
Email: | xxxx_xxxx@xxxxxxxxxxxxxxxx.xxx | |||
With a copy to Xxxxx’x: | ||||
Address: | 7 World Trade Center at 000 Xxxxxxxxx Xxxxxx | |||
Xxx Xxxx, XX 00000 | ||||
With a copy to the Indenture Trustee: | ||||
Address: | U.S. Bank National Association | |||
000 X. XxXxxxx Xxxxxx, Xxxxx 000 | ||||
Xxxxxxx, XX 00000 |
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(b) Process Agent. For the purpose of Section 13(c):
Party A appoints as its Process Agent: Not Applicable.
Party B appoints as its Process Agent: Not Applicable.
(c) Offices. The provisions of Section 10(a) will apply to this Agreement.
(d) Multibranch Party. For the purpose of Section 10(c) of this Agreement:
(i) Party A is a Multibranch Party and may act through its London or New York branch
offices or such other Office as may be agreed to by the parties in connection with a
Transaction.
(ii) Party B is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is Party A unless an Event of Default has
occurred and is continuing with respect to Party A, in which case a Calculation Agent shall
be appointed by Party B in its reasonable discretion.
(f) Credit Support Document. Details of any Credit Support Document:
Each of the following, as amended, extended, supplemented or otherwise modified in writing
from time to time, is a “Credit Support Document”:
Party A: (i) The Credit Support Annex and (ii) any guarantee (including any Eligible
Guarantee) of Party A’s obligations hereunder procured by Party A in compliance with this
Agreement.
Party B: The Credit Support Annex.
Party B agrees that the security interests in the collateral granted to the Indenture
Trustee under the Indenture shall secure the obligations of Party B to Party A under this
Agreement.
(g) Credit Support Provider.
Credit Support Provider means in relation to Party A, (1) Party A in its capacity as the
Pledgor under the Credit Support Annex and (2) the guarantor under any guarantee (including
any Eligible Guarantee) of Party A’s obligations hereunder procured by Party A in compliance
with this Agreement.
Credit Support Provider means in relation to Party B, Not Applicable.
(h) Governing Law. This Agreement and any and all controversies arising out of or in
relation to this Agreement will be governed by and construed in accordance with the laws of the
State of New York (without reference to its conflict of laws doctrine).
(i) Netting of Payments. Subparagraph (ii) of Section 2(c) of this Agreement will apply to
all Transactions under the Agreement.
(j) “Affiliate” will have the meaning specified in Section 14 of this Agreement.
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(a) Representations. Section 3(a)(iii) is hereby amended by inserting the words “or
investment policies, or guidelines, procedures, or restrictions,” immediately following the word
“documents.”
(b) Financial Statements. Section 3(d) is hereby amended by adding in the third line thereof
after the word “respect” and before the period:
“provided, however, that in the case of financial statements delivered by either party, the
only representation being made by either party is that such financial statements give a fair
view of the state of affairs of the relevant entity to which they relate as at the date of
such financial statements, and, to the extent such financial statements are required by
Regulation AB (as defined herein), such financial statements comply in form and substance
with the requirements of Regulation AB.”
(c) Additional Representations. Section 3 is hereby amended by adding the following
additional subsections:
(g) Eligible Contract Participant. (a) It is an “eligible contract participant” as
defined in the Commodity Exchange Act, as amended by the Commodity Futures
Modernization Act of 2000, (b) the Agreement and each Transaction is subject to
individual negotiation by each party and (c) neither this Agreement nor any
Transaction will be executed or traded on a “trading facility” within the meaning of
Section 1a(33) of the Commodity Exchange Act, as amended.
(h) Line of Business. It has entered into this Agreement (including each
Transaction evidenced hereby) in conjunction with its line of business (including
financial intermediation services) or the financing of its business.
(i) No Agency. It is entering into this Agreement, any Credit Support Document to
which it is a party, each Transaction and any other documentation relating to this
Agreement or any Transaction as principal (and not as agent or in any other
capacity, fiduciary or otherwise).
In addition, the parties each represent that:
No Reliance. Each party represents to the other party (which representation will be
deemed to be repeated by each party on each date on which a Transaction is entered
into or amended, extended or otherwise modified) that: (1) it is acting for its own
account and has made its own independent decisions to enter into this Agreement and
any Transaction hereunder and as to whether this Agreement and any Transaction
hereunder is appropriate or proper for it based on its own judgment and upon advice
from such advisors as it has deemed necessary; (2) it is not relying on any
communication (written or oral) of the other party as investment advice or as a
recommendation to enter into this Agreement or any Transaction hereunder, it being
understood that information and explanations related to the terms and conditions of
this Agreement and any Transaction hereunder shall not be considered investment
advice or a recommendation to enter into this Agreement or any Transaction
hereunder; (3) no communication (written or oral) received from the other party
shall be deemed to be an assurance or guarantee as to the expected results of any
Transaction hereunder; and (4) it is capable of evaluating and understanding (on its
own
- 11 -
behalf or through independent professional advice), and understands and accepts, the
terms, conditions and risks of that Transaction; and (5) it is capable of assuming,
and assumes, the financial and other risks of that Transaction.
In addition, Party B represents that:
ERISA. It is not, does not constitute part of and is not using as a source of funds
for any Transaction any assets of (1) an “employee benefit plan” within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), subject to Title I of ERISA, (2) a “plan” within the meaning of Section
4975 of the Internal Revenue Code of 1986, as amended (the “Tax Code”), subject to
Section 4975 of the Tax Code, or (3) an entity whose underlying assets include plan
assets by reason of investment by a plan described in (1) or (2) above in such
entity, including but not limited to, an insurance company general account, an
insurance company separate account or a collective investment fund, within the
meaning of 29 C.F.R. 2510.3-101 as modified by Section 3(42) of ERISA.
In addition, Party A represents that:
Pari Passu: Its obligations under this Agreement rank pari passu with all of its
other unsecured, unsubordinated obligations except those obligations preferred by
operation of law.
(d) Method of Notice. Section 12(a)(ii) of this Agreement is deleted in its entirety.
(e) Set-off.
(i) All payments under this Agreement shall be made without set-off or counterclaim,
except as expressly provided for in Section 2(c) or Paragraph 8 of the Credit Support Annex.
(ii) Section 6(e) shall be amended by the deletion of the following sentence: “The
amount, if any, payable in respect of an Early Termination Date and determined pursuant to
this Section will be subject to any Set-off.”
(i) No Amendment without Satisfaction of Rating Agency Condition. Section 9(b) of this
Agreement is hereby amended by adding the following at the end of such Section: “, and
unless the Indenture Trustee consents and the Rating Agency Condition is satisfied.”
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(ii) Consent by Party A to Amendments to Certain Documents. Before any amendment or
supplement is made to the Indenture and/or any other Transaction Document that would
adversely affect any of Party A’s rights or obligations under this Agreement, the Indenture
or such Transaction Document, or impair the ability of Party B to fully perform any of Party
B’s obligations under this Agreement, the Indenture or such Transaction Document, Party B
shall (x) provide Party A with a copy of the proposed amendment or supplement and shall
obtain the written consent of Party A (which consent shall not be unreasonably withheld) to
such amendment or supplement prior to its adoption, (y) satisfy the Rating Agency Condition
(if otherwise required under the Indenture or other applicable Transaction Document), and
(z) if applicable, provide to Party A a copy of any Rating Agency confirmation promptly
after receipt thereof from the relevant Rating Agency. For the avoidance of doubt, any
Transaction Document may be amended, supplemented or otherwise modified in accordance with
the terms thereof without the consent of Party A to cure any typographical error or
ambiguity, provided that such actions shall not adversely affect in any respects the
interests of Party A.
(i) Notices to Noteholders. Party B shall provide Party A with copies of all notices and
reports given to the holders of the Notes, and upon request, shall provide Party A with any other
notices or reports which could be requested by the holders of any Notes.
(j) Terms of Indenture. Party B hereby agrees that, during the period commencing with the
date of this Agreement through and including such date on which all of Party B’s obligations under
this Agreement are fully performed, Party B will deliver to Party A at the address for notices to
Party A provided in Part 4 each notice, document, certificate or other writing that Party B is
obligated to furnish to any other Person under the Indenture. Party A hereby consents to the
provisions of the Indenture applicable to it with respect to priority of payments and recourse as
if Party A were a party thereto. Party B hereby agrees that Party A shall be entitled to the
benefits of the Indenture to the extent set forth therein as if Party A were a party thereto.
(k) Transfers.
(i) If a Xxxxx’x First Trigger Event has occurred and is continuing, Party A shall at
its own cost, within 30 Local Business Days, either (x) post collateral in accordance with
the Credit Support Annex, (y) procure an Eligible Guarantee in respect of all of Party A’s
present and future obligations under this Agreement from a guarantor that has the Xxxxx’x
Required Hedge Ratings, or (z) effect a transfer of its rights and obligations under this
Agreement to an Eligible Replacement in accordance with Part 5(k)(ii).
(ii) Either (A) upon the occurrence of a Xxxxx’x First Trigger Event, or (B) pursuant
to the Indemnification and Disclosure Agreement dated December 8, 2008 among American Honda
Finance Corporation, American Honda Receivables Corp. and Party A, or (C) upon the
occurrence of a downgrade event under Part 5(l), and subject to Part 5(v) below and subject
to satisfaction of the Rating Agency Condition as to S&P, Party A may (at its own expense)
transfer all or substantially all of its rights and obligations with respect to this
Agreement to any other entity (a “Transferee”) that is an Eligible Replacement,
provided that Party B shall be entitled to determine in its sole discretion, acting
in a commercially reasonable manner, whether or not the transfer relates to all or
substantially all of Party A’s rights and obligations under this Agreement. Following such
transfer, all references to Party A shall be deemed to be references to the Transferee.
(iii) If an entity has made a Firm Offer (which remains capable of becoming legally
binding upon acceptance) to be the transferee of a transfer to be made in accordance with
(ii)
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above, Party B shall (at Party A’s expense) at Party A’s written request, take any
reasonable steps required to be taken by it to effect such transfer.
(iv) For the avoidance of doubt, nothing in this Part 4(k) shall impair or modify Party
A’s rights or obligations under Section 6(b)(ii) or Section 7, subject to satisfaction of the
Rating Agency Condition.
(A) [RESERVED].
(B) S&P Collateralization Events. If an S&P Collateralization Event occurs and is
continuing with respect to each Relevant Entity, Party A shall (a) within ten Local
Business Days of the occurrence of such S&P Collateralization Event and at its sole
expense, post Eligible Collateral for the benefit of Party B in the amount and on
the terms then applicable under the Credit Support Annex, and (b) use commercially
reasonable efforts to, within 60 calendar days of the occurrence of such S&P
Collateralization Event, either (1) assign its rights and obligations under all
Transactions to an Eligible Replacement in accordance with Part 5(k)(ii) above,
provided that (A) no termination payments or other settlement amounts are
payable by Party B to either Party A or the Transferee at the time of or as a result
of such assignment by Party A and (B) any termination payments or other settlement
amounts are to be settled directly between Party A and the Transferee; or (2)
procure an Eligible Guarantee of Party A’s obligations hereunder by a guarantor that
satisfies the Hedge Counterparty Ratings Requirement and has the Xxxxx’x Required
Hedge Ratings. Upon the successful consummation of any assignment to a Transferee
or the delivery of any Eligible Guarantee as contemplated in this Part 5(l)(B), any
obligation of Party A to post and maintain collateral under the Credit Support Annex
shall terminate and Party B shall release its security interest in, and return to
Party A, any then-posted collateral.
(C) Xxxxx’x Second Trigger Events. If a Xxxxx’x Second Trigger Event has occurred
and is continuing, Party A shall at its own cost use commercially reasonable efforts
to, as soon as reasonably practicable, either (x) procure an Eligible Guarantee in
respect of all of Party A’s present and future obligations under this Agreement from
a guarantor that has the Xxxxx’x Required Hedge Ratings, or (y) effect a transfer of
its rights and obligations under this Agreement to an Eligible Replacement in
accordance with Part 5(k)(ii) above.
(m) USA PATRIOT Act Notice. Party A hereby notifies Party B that pursuant to the requirements
of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the
“Act”), it is required to obtain, verify and record information that identifies Party B, which
information includes the name and address of Party B and other information that will allow Party A
to identify Party B in accordance with the Act.
(n) Non-Petition. Party A agrees that it will not, prior to at least one year and one day (or
if longer, the applicable preference period then in effect) following the payment in full of all
the Notes issued pursuant to the Indenture, acquiesce, petition or otherwise invoke or cause Party
B to invoke the process of any governmental authority for the purpose of commencing or sustaining a
case (whether voluntary or involuntary) against Party B under any bankruptcy, insolvency or similar
law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of Party B or any substantial part of its property or ordering the winding-up or
liquidation of the affairs of Party B; provided
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that this provision shall not restrict or prohibit Party A from joining any other person,
including, without limitation, the Trustee, or from asserting or exercising its rights, in any
bankruptcy, reorganization, arrangement, insolvency, moratorium or liquidation proceedings
commenced by any Person other than Party A or its affiliates or other analogous proceedings already
commenced under applicable laws. This Part 5(n) shall survive any termination of this Agreement.
(o) Limited Recourse. Notwithstanding anything to the contrary contained herein, the
obligations of Party B under this Agreement are limited recourse obligations of Party B, payable
solely from the Collateral (as such term is defined in the Indenture), subject to and in accordance
with the terms of the Indenture, and, following realization of the Collateral, any claims of Party
A against Party B shall be extinguished and shall not thereafter revive. None of the trustees,
officers or administrators of Party B shall be liable for any amount due from Party B under this
Agreement. It is understood that the foregoing provisions shall not (i) prevent recourse to the
Collateral for the sums due or to become due to Party A under Agreement (subject to the priority of
payments set forth in the Indenture) or (ii) constitute a waiver, release or discharge of any
obligation of Party B arising under this Agreement until the Collateral has been realized and the
proceeds applied in accordance with the Indenture, whereupon any outstanding obligation of Party B
under this Agreement shall be extinguished. Notwithstanding the foregoing (or anything to the
contrary in this Agreement), Party B shall be liable for its own fraud, willful misconduct and/or
bad faith. This Part 5(o) shall survive any termination of this Agreement.
(p) [RESERVED].
(r) Delivery of Confirmations. For each Transaction entered into hereunder, Party A shall
promptly send to Party B a Confirmation (which may be via facsimile transmission). Party B agrees
to respond to such Confirmation within two Local Business Days, either confirming agreement thereto
or requesting a correction of any error(s) contained therein. Failure by Party A to send a
Confirmation or of Party B to respond within such period shall not affect the validity or
enforceability of such Transaction. Absent manifest error, there shall be a presumption that the
terms contained in such Confirmation are the terms of the Transaction.
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(s) Certain Definitions.
“Eligible Guarantee” means an unconditional and irrevocable guarantee that is
satisfactory to S&P (as evidenced by the satisfaction of the Rating Agency Condition
as to S&P) and is provided by a guarantor which waives traditional suretyship
defenses or which is a monoline insurer under a traditional financial guarantee
insurance policy (and in either case does not require the beneficiary to proceed
against the principal obligor prior to a claim for payment) and is directly
enforceable by Party B, where either (A) a law firm has given a legal opinion
confirming that none of the guarantor’s payments to Party B under such guarantee
will be subject to withholding for Tax and such opinion has been disclosed to
Xxxxx’x, (B) such guarantee provides that, in the event that any of such guarantor’s
payments to Party B are subject to withholding for Tax, such guarantor is required
to pay such additional amount as is necessary to ensure that the net amount actually
received by Party B (free and clear of any withholding tax) will equal the full
amount Party B would have received had no such withholding been required, or (C) in
the event that any payment under such guarantee is made net of deduction or
withholding for Tax, Party A is required, under Section 2(a)(i), to make such
additional payment as is necessary to ensure that the net amount actually received
by Party B from the guarantor will equal the full amount Party B would have received
had no such deduction or withholding been required.
“Eligible Replacement” means an entity (i) that (A) has the Xxxxx’x First Trigger
Required Ratings and/or the Xxxxx’x Second Trigger Required Ratings and (B)
satisfies the Hedge Counterparty Ratings Requirement, or (ii) whose present and
future obligations owing to Party B are guaranteed pursuant to an Eligible Guarantee
provided by a guarantor that (A) has the Xxxxx’x Required Hedge Ratings, and (B)
satisfies the Hedge Counterparty Ratings Requirement.
“Firm Offer” means an offer which, when made, was capable of becoming legally
binding upon acceptance.
“Hedge Counterparty Ratings Requirement” is satisfied by a Relevant Entity if it
has a short-term rating from S&P of at least “A-1” or, if such entity does not have
a short-term rating from S&P, a long-term rating from S&P of at least “A+”.
“Xxxxx’x Collateralization Requirements” means the obligation of Party A to post
collateral at the times, and in the amounts, required under the Credit Support Annex
in connection with the occurrence of a Xxxxx’x First Trigger Event or Xxxxx’x Second
Trigger Event (as applicable). For the avoidance of doubt, the Xxxxx’x
Collateralization Requirements shall be calculated as if no S&P Collateralization
Event had then occurred.
“Xxxxx’x First Trigger Event” means, at any time when Notes are Outstanding and
rated by Xxxxx’x but a Xxxxx’x Second Trigger Event has not occurred, that no
Relevant Entity satisfies the Xxxxx’x First Trigger Required Ratings.
“Xxxxx’x First Trigger Required Ratings” are satisfied by an entity (x) where such
entity is the subject of a Xxxxx’x Short-term Rating, if such rating is “Prime-1”
and its long term, unsecured and unsubordinated debt obligations are rated “A2” or
above by Xxxxx’x, and (y) where such entity is not the subject of a Xxxxx’x
Short-term Rating, if its long-term, unsecured and unsubordinated debt obligations
are rated “A1” or above by Xxxxx’x.
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“Xxxxx’x Required Hedge Ratings” means the Xxxxx’x First Trigger Required Ratings or
the Xxxxx’x Second Trigger Required Ratings.
“Xxxxx’x Second Trigger Event” means, at any time when Notes are Outstanding and
rated by Xxxxx’x, that no Relevant Entity satisfies the Xxxxx’x Second Trigger
Required Ratings.
“Xxxxx’x Second Trigger Required Ratings” are satisfied by the entity (x) where such
entity is the subject of a Xxxxx’x Short-term Rating, if such rating is “Prime-2” or
above and its long-term, unsecured and unsubordinated debt obligations are rated
“A3” or above by Xxxxx’x, and (y) where such entity is not the subject of a Xxxxx’x
Short-term Rating, if its long-term, unsecured and unsubordinated debt obligations
are rated “A3” or above by Xxxxx’x.
“Xxxxx’x Short-Term Rating” means a rating assigned by Xxxxx’x under its short-term
rating scale in respect of an entity’s short-term, unsecured and unsubordinated debt
obligations.
“Rating Agency Condition” has the meaning set forth in the Indenture.
“Relevant Entities” means Party A and any guarantor under an Eligible Guarantee in
respect of all of Party A’s present and future obligations under this Agreement.
An “S&P Collateralization Event” is deemed to occur with respect to a Relevant
Entity if, at any time when any of the Notes are Outstanding and rated by S&P, the
short-term rating of such Relevant Entity from S&P is withdrawn, suspended or
downgraded below “A-1” or, if no such short-term rating exists, if the long-term
rating of such Relevant Entity from S&P is withdrawn, suspended or downgraded below
“A+”.
“S&P Collateralization Requirements” means the obligation of Party A to post
collateral at the times, and in the amounts, required under the Credit Support Annex
in connection with the occurrence of an S&P Collateralization Event. For the
avoidance of doubt, the S&P Collateralization Requirements shall be calculated as if
no other Rating Agency trigger event had then occurred.
“Transaction Documents” shall mean the Indenture, the Administration Agreement, the
Receivables Purchase Agreement, the Sale and Servicing Agreement, the Trust
Agreement and any account control agreement or similar agreement assigning, granting
or perfecting an interest in Collateral for the benefit of Party A under the
Indenture.
(t) [RESERVED.]
(u) Tax. Notwithstanding the definition of “Indemnifiable Tax” in Section 14 of this
Agreement, in relation to payments by Party A, any Tax shall be an Indemnifiable Tax unless such
Tax arises as a result of a change in Tax Law (in which case such Tax shall be an Indemnifiable Tax
only if such Tax satisfies the definition of Indemnifiable Tax provided in Section 14) and, in
relation to payments by Party B, no Tax shall be an Indemnifiable Tax.
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B, and no transfer of any rights or obligations under this Agreement shall be made unless the
Rating Agency Condition shall have been satisfied.
(w) Severability. If any term, provision, covenant, or condition of this Agreement, or the
application thereof to any party or circumstance, shall be held to be invalid or unenforceable (in
whole or in part) for any reason, the remaining terms, provisions, covenants, and conditions hereof
shall continue in full force and effect as if this Agreement had been executed with the invalid or
unenforceable portion eliminated, so long as this Agreement as so modified continues to express,
without material change, the original intentions of the parties as to the subject matter of this
Agreement and the deletion of such portion of this Agreement will not substantially impair the
respective benefits or expectations of the parties to the Agreement; provided,
however, that this severability provision shall not be applicable if any provision of
Section 2, 5, 6, or 13 (or any definition or provision in Section 14 to the extent it relates to,
or is used in or in connection with, any such Section) shall be so held to be invalid or
unenforceable.
(x) Acknowledgement of Assignment. Party A hereby acknowledges and consents to Party’s
assignment to the Trustee, for the benefit of the secured parties under the Indenture, of Party B’s
rights hereunder, including the right to enforce Party A’s obligations hereunder.
(y) Compliance with Regulation AB. In connection with the Indenture, Party B represents that
this Agreement is a derivative instrument as described in Item 1115 of Regulation AB under the
Securities Act of 1933 and the Securities Exchange Act of 1934, as amended (“Regulation AB”), and
not a credit support contract described in Item 1114 of Regulation AB.
Reference is made to the Indemnification and Disclosure Agreement dated December 8, 2008 among
American Honda Finance Corporation, American Honda Receivables Corp, and Party A with regard to
further provisions concerning Regulation AB.
[Signature Page Follows]
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JPMORGAN CHASE BANK, N.A. | HONDA AUTO RECEIVABLES 2008-2 | |||||||||
OWNER TRUST | ||||||||||
By: Deutsche Bank Trust Company Delaware, not in its individual capacity but solely as Owner Trustee on behalf of the Trust |
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By:
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By: | |||||||||
Name: | Name: | |||||||||
Title: | Title: | |||||||||
Name: | ||||||||||
Title: |
ISDA SCHEDULE — SIGNATURE PAGE