SCHEDULE to the ISDA Master Agreement (1992 Multicurrency – Cross Border) dated as of January 23, 2008 between THE ROYAL BANK OF SCOTLAND PLC, a company incorporated under the laws of Scotland(“Party A”) and FORD CREDIT AUTO OWNER TRUST 2008-A, a...
Exhibit
10.1
SCHEDULE
to
the
(1992
Multicurrency – Cross Border)
dated
as of January 23, 2008
between
THE
ROYAL BANK OF SCOTLAND PLC,
a
company incorporated under the laws
of Scotland(“Party
A”)
and
a
Delaware statutory trust
(“Party
B”)
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Part
1.
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(a)
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“Specified
Entity”
means
in relation to Party A for
the purpose of:
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Section
5(a)(v),
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Not
applicable.
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Section
5(a)(vi),
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Not
applicable.
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Section
5(a)(vii),
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Not
applicable.
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Section
5(b)(iv),
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Not
applicable.
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in
relation to Party B for the purpose of:
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Section
5(a)(v),
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Not
applicable.
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Section
5(a)(vi),
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Not
applicable.
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Section
5(a)(vii),
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Not
applicable.
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Section
5(b)(iv),
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Not
applicable.
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(b)
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“Specified
Transaction”
will
have the meaning specified in
Section 14 of this Agreement unless another meaning is specified
here: No
change from Section 14.
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(c)
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The
“Breach
of Agreement”
provisions
of Section 5(a)(ii),
the “Misrepresentation”
provisions
of Section 5(a)(iv) and
the
“Default
under Specified Transaction”
provisions
of Section 5(a)(v) will
not apply to Party B.
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(d)
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The
“Credit
Support Default”
provisions
of Section 5(a)(iii)
will not apply to Party B except that Section 5(a)(iii)(1) will
apply in
respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex.
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(e)
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The
“Cross
Default”
provisions
of
Section 5(a)(vi)
will not apply to
Party B
and will apply to Party A with a
Threshold
Amount
equal to 3 percent of
Party A’s
shareholders’ equity
(excluding deposits),
as shown on its most recent audited financial statements.
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Section
5(a)(vii)(2),(7) and (9) will
not apply to Party B.
Section
5(a)(vii)(3) will not apply to
Party B to the extent any assignment, arrangement or composition that is
effected by or pursuant to the Basic Documents.
Section
5(a)(vii)(4) will not apply to
Party B to the extent any such proceeding or petition was instituted or
presented by Party A or any of its Affiliates.
Section
5(a)(vii)(6) will not apply to
Party B to the extent that it refers to (i) any appointment that is effected
pursuant to the Basic Documents or (ii) any appointment to which Party B
has not
become subject.
Section
5(a)(vii)(8) will apply to Party
B only to the extent that it applies to Section 5(a)(vii)(1),(3),(4),(5)
and
(6), as amended.
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)” are
hereby deleted.
Section
5(b)(iii) will apply, provided that Party A will 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.
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(h)
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The
“Credit
Event Upon Merger” provisions
of Section 5(b)(iv)
will not apply to Party A or to Party
B.
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(i)
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The
“Automatic
Early Termination” provisions
of Section 6(a) will
not apply to Party A or to Party
B.
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(j)
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Payments
on Early Termination; General. Subject
to Part 1(k) below,
for
the purpose of Section
6(e):
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(i)
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Market
Quotation will apply unless
Party A is the Affected Party and Party B has contracted to enter
into a
replacement Transaction on or prior to the Early Termination Date,
in
which event Loss will apply.
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(ii)
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The
Second Method will
apply.
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(iii)
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Notwithstanding
anything to the
contrary set forth in the Agreement, if (1) Party B designates
an Early
Termination Date pursuant to Part 5(n)or
5(o) in respect of which any
Transaction is a Terminated Transaction and (2) Party B enters
into a
replacement transaction with a third party on or before such Early
Termination Date, then (x) the amount, if any, payable by Party
B to Party
A in respect of such Early Termination Date and such Transaction
will not
exceed the amount received by Party B from such third party in
consideration of entering into such replacement transaction and
(y) the
amount, if any, payable by Party A to Party B in respect of such
Early
Termination Date and such Transaction will not be less than the
amount
payable by Party B to such third party in consideration of entering
into
such replacement
transaction.
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(k)
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Payments
on Early Termination Due
to Certain Events. Notwithstanding
Section 6, so long
as (A) an Additional
Termination Event occurs pursuant to Part 1(m)(v) or (vi),or (B) Party
A is the Affected
Party in respect of a Tax Event Upon Merger or the
Defaulting Party in respect of
any Event of Default, paragraphs (i) to (v)
below will apply:
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(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 a Reference Market-maker that is 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 Reference Market-maker to enter
into a
transaction (the “Replacement
Transaction”) that would have the effect of preserving for such party 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 Transactions 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 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
that
are, in all material respects, no less beneficial for Party B than those
of this
Agreement (save for the exclusion of provisions relating to Transactions
that
are not Terminated Transactions), as determined by Party B.”
(ii)
In determining whether or not a Firm Offer satisfies the condition in clause
(4)
of “Market Quotation”, Party B will act in a commercially reasonable
manner.
(iii) 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:
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(A)
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if,
on or prior to such Early Termination Date, a Market Quotation
for the
relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding, the Termination
Currency Equivalent of the amount (whether positive or negative)
of such
Market Quotation;
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(B)
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if,
on such Early Termination Date, 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 communicated to Party B and remain capable
of
becoming legally binding upon acceptance by Party B, 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 largest absolute
value);
or
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(C)
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if,
on such Early Termination Date, 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 no Market
Quotations have been communicated to Party B and remain capable
of
becoming legally binding upon acceptance by Party B, 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.”
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(iv)
If Party B requests Party A in writing to obtain Market Quotations, Party
A
shall use its reasonable efforts to do so before the Early Termination
Date.
(v)
If the Settlement Amount is a negative number, Section 6(e)(i)(3) of this
Agreement will 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).”
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(l)
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“Termination
Currency” means
United States
Dollars.
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(m)
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Additional
Termination Events. Each
of the following
will constitute an Additional Termination Event pursuant to Section
5(b)(v):
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(i)
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Any
acceleration of the Notes
pursuant to Section 5.2(a) of the Indenture (provided such acceleration
has not been rescinded pursuant to Section 5.2(b) of the Indenture)
and
liquidation of the Indenture Trust Estate with Party B as the sole
Affected Party;
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(ii)
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Any
amendment or supplement to the
Indenture, the Purchase Agreement or the Sale and Servicing Agreement
that would materially
adversely affect any of
Party A’s rights or obligations under such agreement, this Agreement or
any Transaction that is made without the consent of Party A, which
consent
will not be unreasonably withheld or delayed; provided
that Party A’s consent will be
deemed to have been given if Party A does not object in writing
within 10
Business Days of receipt of a written request for such consent,
with Party
B as the sole Affected
Party;
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(iii)
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Fitch’s
Rating
Triggers. Failure
of
Party A to comply with the requirements of Part 5(n), with Party
A as the
sole Affected Party;
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(iv)
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Regulation
AB. Failure of
Party A to
comply with the requirements of Part 5(s), with Party A as the
sole
Affected Party;
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(v)
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Xxxxx’x
First
Rating Trigger. Party A failed
to
comply with the requirements of Part 5(o)(ii), with Party A as the
sole Affected Party;
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(A)
Party A failed to comply with the
requirements of Part 5(o)(iv), with Party A as the sole Affected
Party; or
(B)(1)
The
Xxxxx’x
Second
Rating Trigger Requirements apply
and 30 or more Local Business Days have elapsed since the last time the
Xxxxx’x Second
Rating Trigger Requirements did
not apply and (2)(a)
at least one Eligible Replacement 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
Part 5(p)(ii)below
or (b) at least one entity
meeting at least
the Xxxxx’x
Second
Trigger Required Ratings has made
a Firm Offer (which remains capable of becoming legally binding upon acceptance
by the offeree) to provide an Eligible Guarantee in respect of all of Party
A’s
present and future obligations under this Agreement, with Party A as the
sole Affected Party; and
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(vii)
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S&P’s
Rating
Triggers. Failure of Party A to comply with the
requirements of Part 5(t), with Party A as the sole Affected Party.
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Part
2.
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(a)
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Payer
Tax Representations. For
the purpose of
Section 3(e), each of Party A and Party B makes the following
representation:
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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)) 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
representation made by the other party pursuant to Section 3(f), (ii) the
satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) and
the accuracy and effectiveness of any document provided by the other party
pursuant to Section 4(a)(i) or 4(a)(iii), and (iii) the satisfaction of the
agreement of the other party contained in Section 4(d), provided that it
will
not be a breach of this representation where reliance is placed on clause
(ii)
above 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.
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(b)
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Payee
Tax Representations. For the purpose
of
Section 3(f):
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(i)
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Party
A makes the following
representations:
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(1)
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Party
A is a tax resident of the
United
Kingdom;
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(2)
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Party
A is a "foreign person"
within the meaning of the applicable U.S. Treasury Regulations
concerning
information reporting and backup withholding tax (as in effect
on
January 1,
2001), unless
Party A
provides written notice to Party B that it is no longer a foreign
person;
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(3)
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in
respect of each Transaction
Party A enters into through an office or discretionary agent in
the United
States or which otherwise is allocated (in whole or part) for United
States federal income tax purposes to such United States trade
or
business, each payment received or to be received by Party A under
such
Transaction (or portion thereof, if applicable) will be effectively
connected with its conduct of a trade or business in the United
States;
and
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(4)
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in
respect of all other
Transactions or portions thereof, no such payment received or to
be
received by Party A in connection with this Agreement is attributable
to a
trade or business carried on by it through a permanent establishment
in
the United
States.
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(ii)
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Party
B makes the following
representations: It is a United States Person for U.S. federal
income tax
purposes and either (a) is a financial institution (within the
meaning of
Treasury Regulations section 1.1441-1(c)(5)) or (b) is not acting
as an
agent for a person that is not a United States Person for U.S.
federal
income tax purposes.
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Part
3.
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(a)
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For
purposes of Section 4(a)(i)
and (ii), each party agrees to deliver the following documents,
as
applicable:
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Party
required to deliver document
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Form/Document/Certificate
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Date
by which to be delivered
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Party
A and Party B
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Any
form or document that may be required or reasonably requested in
order to
allow the other party to make a payment under this Agreement without
any
deduction or withholding for or on account of any Tax or with such
deduction or withholding at a reduced rate, including IRS Form
X-0, Xxxx
0XXX or Form W-8BEN, as applicable.
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On
the date of this Agreement, and promptly upon the earlier of (i)
reasonable demand by the other party and (ii) learning that the
form or
document is required.
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(b)
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Other
documents to be delivered
are:
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Party
required to deliver document
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Form/Document/Certificate
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Date
by which to be delivered
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Party
A
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Annual
audited financial statements prepared in accordance with
generally accepted accounting principles in the
country in which the party is organized, if not publicly available
at
xxxx://xxx.xxxxxxxxx.xxx.xxx/xxxxxxxx_xxxxxxxxx/
financial_info/natwest_info.cfm.
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Promptly
upon Party B’s request.
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Yes
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Party
A and Party B
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Certificate
or other documents evidencing the authority of the party
entering into this Agreement or a Confirmation, as the case
may be, including copies of any board resolutions and appropriate
certificates of incumbency as to the officers executing
such documents.
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Upon
execution of this Agreement.
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Yes
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Party
A and Party B
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Opinions
of counsel in form and substance acceptable to the other
party.
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Upon
execution of this Agreement.
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No
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Party
A
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Financial
data relating to Party A, as required pursuant to Part 5(s) of
this
Schedule.
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As
required pursuant to Part 5(s) of this Schedule.
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Yes
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Party
A
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Executed
Indemnification and Contribution Agreement, among Party A, Ford
Motor
Credit Company LLC and Ford Credit Auto Receivables Two LLC, relating
to
Party A’s furnished information for use in the Prospectus
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At
or promptly following execution of this Agreement.
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Yes
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Party
B
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Copies
of executed Indenture and Sale and Servicing Agreement
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Upon
execution of such agreements.
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No
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Part
4.
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(a)
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Addresses
for
Notices:
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(1)
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TO
PARTY A:
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For
the
purpose of Section 12(a), notices will be delivered to the following
address:
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Address:
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x/x
XXX Xxxxxxxxx Xxxxxxx, Xxxxx 0, 135 Xxxxxxxxxxx, Xxxxxx, XX0X
0XX
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Attention:
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Swaps
Administration
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Telephone:
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000
0000 0000
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Fax:
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000
0000 0000
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Any
notice delivered for purposes of Sections 5, 6 and 7 will be delivered to
the
following address:
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Address:
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c/o
RBS Financial
Markets
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Xxxxx
0, 000
Xxxxxxxxxxx
Xxxxxx
XX0X
3UR
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Attention:
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Head
of Legal, Financial
Markets
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Telephone:
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00
000 000
0000
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Facsimile:
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44
207 085
8411
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With
a copy to:
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Address:
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c/o
Greenwich Capital Markets,
Inc.
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000
Xxxxxxxxx Xxxx
Xxxxxxxxx,
XX 00000
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Attention:
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Legal
Department – Derivatives
Documentation
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Phone
No.:
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000-000-0000/32
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Facsimile
No.:000-000-0000/34
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(2)
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TO
PARTY B:
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For
the
purpose of Section 12(a), notices will be delivered to the address or facsimile
number specified in the Confirmation of such Transaction. Any notice
delivered for purposes of Sections 5, 6 and 7 will be delivered to the following
address:
U.S.
Bank
Trust National Association,
as
Owner
Trustee for
000
Xxxxxxxx Xxxxxx, Xxxxx Xxxxx
Xxxxxxxxxx,
Xxxxxxxx 00000
Attn: Corporate
Trust Department
Telephone:
(000) 000-0000
Fax: (000)
000-0000
with
copies to:
The
Bank
of New York,
as
Indenture Trustee for
Ford
Credit Auto Owner Trust 0000-X
000
Xxxxxxx Xxxxxx
Xxxxx
8
West
Attn:
Structured Finance Services -
Asset
Backed Securities, Ford 2008-A
Telephone: (000)
000-0000
Fax: (000)
000-0000
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and
Ford
Motor Credit Company LLC
Xxx
Xxxxxxxx Xxxx, Xxxxx 0000
Xxxxxxxx,
Xxxxxxxx 00000
Attention: Corporate
Secretary
Telephone: (000)
000-0000
Fax: (000)
000-0000
and
Ford
Motor Credit Company LLC
c/o
Ford
Motor Company WHQ
Xxx
Xxxxxxxx Xxxx, Xxxxx 000-X0
Xxxxxxxx,
Xxxxxxxx 00000
Attention:
Securitization Operations Supervisor
Telephone:
(000) 000-0000
Fax:
(000) 000-0000
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(b)
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Process
Agent. For
the purpose of Section
13(c):
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Party
A appoints as its Process Agent:
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Not
applicable.
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Party
B appoints as its Process Agent:
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Not
applicable.
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(c)
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Offices. The
provisions of
Section 10(a) will apply.
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(d)
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Multibranch
Party. For
the purpose of
Section 10:
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(i)
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Party
A is not a Multibranch
Party.
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(ii)
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Party
B is not a Multibranch
Party.
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(e)
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Calculation
Agent. The
Calculation Agent is Party
B.
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(f)
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(g)
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Single
Agreement. Section
1(c) willbe
amended by the addition
of
the words “, the Credit
Support Annex” after the
words “Master
Agreement”.
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(h)
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Netting
of Payments. Subparagraph
(ii) of
Section 2(c) will apply to all Transactions under this
Agreement.
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(i)
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“Affiliate”
will
have the meaning specified in
Section 14.
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(j)
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Waiver
of Jury Trial. Each
party waives, to
the fullest extent permitted by applicable law, its right to have
a jury
trial in respect to any proceedings related to this
Agreement. Each party certifies that no representative, agent
or attorney of the other party has represented, expressly or otherwise,
that such other party would not, in the event of such a suit, action
or
proceeding, seek to enforce the foregoing
waiver.
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(k)
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The
definition of “Local
Business Day”
in Section
14
will be amended
by the addition of the
words “or
any Credit Support Document”
after
“Section
2(a)(i)”and
the addition of the words
“or Credit
Support
Document”
after
“Confirmation”.
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Part
5.
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(a)
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Non-Reliance. In
connection with the negotiation
of, the entering into, and the execution of this Master Agreement,
any
Credit Support Document to which it is a party, each Transaction
and any
other documentation relating to this Master Agreement to which
it is a
party or that is required by this Master Agreement to deliver,
each of
Party A and Party B represents and agrees
that:
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(i)
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it
is not relying (for the
purposes of making any investment decision or otherwise) upon any
advice,
counsel or representations (whether written or oral) of the other
party to
this Master Agreement, such Credit Support Document, each Transaction
or such other documentation other than the representations expressly
set forth in this Master Agreement, such Credit Support Document and
in any Confirmation;
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(ii)
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it
has consulted with its own
legal, regulatory, tax, business, investment, financial and accounting
advisors to the extent it has deemed necessary, and it has made
its own
investment, hedging and trading decisions (including decisions
regarding the suitability of any Transaction pursuant to this Master
Agreement) based upon its own judgment and upon any advice from
such
advisors as it has deemed necessary and not upon any view expressed
by the
other party to this Master Agreement, such Credit Support Document,
each
Transaction or such other
documentation;
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(iii)
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it
has a full understanding of all
the terms, conditions and risks (economic and otherwise) of the
Master Agreement, such Credit Support Document, each Transaction
and such
other documentation and is capable of assuming and willing to,
and will,
assume (financially and otherwise) those
risks;
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(iv)
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it
is an “eligible contract
participant” as defined in Section 1a(12) of the Commodity Exchange Act (7
U.S.C. 1a), as amended by the Commodity Futures Modernization Act
of
2000;
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(v)
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it
is entering into this Master
Agreement, such Credit Support Document, each Transaction and such
other documentation for the purposes of managing its borrowings
or
investments, hedging its underlying assets or liabilities or in
connection
with a line of business;
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(vi)
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it
is entering into this Master
Agreement, such Credit Support Document, each Transaction and such
other documentation as principal, and not as agent or in any other
capacity, fiduciary or otherwise;
and
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|
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(vii)
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the
other party to this Master
Agreement, such Credit Support Document, each Transaction and such
other documentation (a) is not acting as a fiduciary or financial,
investment or commodity trading advisor for it, (b) has not given
to it
(directly or indirectly through any other person) any assurance,
guaranty
or representation whatsoever as to the merits (either legal, regulatory,
tax, financial, accounting or otherwise) of this Master
Agreement, such Credit Support Document, each Transaction or such
other documentation, and (c) has not committed to unwind the
Transactions.
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(b)
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Tax
Provisions.
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28
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(i)
|
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
and, in relation to payments by Party B, no Tax shall be
an Indemnifiable
Tax.
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(ii)
|
Section
2(d)(i)(4) of this
Agreement shall be deleted in its entirety and replaced with the
words
“if
such Tax is an Indemnifiable
Tax, pay to Y, in addition to the payment which Y is otherwise
entitled
under this Agreement, such additional amount as is necessary to
ensure
that the net amount actually received by Y (free and clear of
Indemnifiable Taxes, whether against X or Y) will equal the full
amount Y
would have received
had no such deduction or withholding been
required”.
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(c)
|
Additional
Representation by Party A. Section 3
is
amended by adding the
following additional representation by Party
A
only:
|
“(h) 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.”
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(d)
|
No
Petition. Party
A covenants and
agrees that prior to the date that is one year and one day after
the
payment in full of (i) all of the Notes and any other securities
issued by
Party B and (ii) any other securities issued by a trust as to which
Ford
Credit Auto Receivables Two LLC is a depositor (or, if later, the
expiration of all applicable preference periods under the United
States
Bankruptcy Code or other applicable law), it will not institute
against,
or join with any other Person in instituting against, Party B or
Ford
Credit Auto Receivables Two LLC any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other proceedings
under United States federal or state bankruptcy or similar law
in
connection with any obligations under this Agreement. The
provisions of this paragraph will survive the termination of this
Agreement.
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(e)
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Limited
Recourse; Subordination.
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(i)
|
Notwithstanding
anything to the
contrary contained in this Agreement, the obligations of Party
B under
this Agreement and any Transaction hereunder are solely the
obligations of Party B and will be payable solely to the extent
of funds
received by and available to Party B in accordance with the priority
of
payment provisions under the Indenture and on the Payment Dates
specified
therein. Party A acknowledges that Party B has pledged its
assets constituting the Indenture Trust Estate to the Indenture
Trustee. Upon exhaustion of the assets of Party B and the
proceeds thereof in accordance with the Indenture and the Sale
and
Servicing Agreement, Party A will not be entitled to take any further
steps against Party B to recover any sums due but unpaid under
this
Agreement, all claims in respect of which will be
extinguished. No recourse may be taken for the payment of any
amount owing in respect of any obligation of, or claim against,
Party B
arising out of or based upon this Agreement or any Transaction
against any
holder of a beneficial interest, employee, officer or Affiliate of
Party B and, except as specifically provided in this Agreement,
no
recourse may be taken for the payment of any amount owing in respect
of
any obligation of, or claim against, Party B based on or arising
out of
this Agreement against the Administrator (as defined in the Administration
Agreement), Ford Credit Auto Receivables Two LLC or any stockholder,
holder of a beneficial interest, employee, officer, director, incorporator
or Affiliate of such person; provided,
however,
that the foregoing will not
relieve any such person or entity from any liability they might
otherwise
have as a result of their gross negligence or willful
misconduct.
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29
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|
(ii)
|
The
parties intend that
Part
5(e)(i)of this
Schedule constitute an enforceable subordination agreement under
Section
510(a) of the Bankruptcy Code and will survive the termination
of this
Agreement.
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(f)
|
Party
B Pledge. Notwithstanding
Section 7 to the
contrary, Party A acknowledges that (i) Party B will pledge its
rights
under this Agreement to the Indenture Trustee for the benefit of
the
Noteholders and the Swap Counterparties pursuant to the Indenture
and
agrees to such pledge and (ii) Party A (as
a
Secured
Party
under
the Basic Documents) has no
voting rights in connection with any action to be taken on behalf
of
the Secured
Parties. The
Indenture Trustee
will not be deemed to be a party to this Agreement, provided,
however,
the Indenture Trustee, acting on
behalf of the holders of the Notes, will have the right to enforce
this
Agreement against Party A. Party A will be entitled to rely on
any notice or communication from the Indenture Trustee to that
effect. Party A acknowledges that Party B will pledge
substantially all its assets to the Indenture Trustee for the benefit
of
the Noteholders and Party A and that all payments hereunder, including
payments on early termination, will be made in accordance with
the
priority of payment provisions of the Indenture and the Sale and
Servicing
Agreement and on the Payment Dates specified
therein.
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(g)
|
Severability. If
any term,
provision, covenant, or condition of this Agreement, or the application
thereof to any party or circumstance, will be held to be invalid
or
unenforceable (in whole or in part) for any reason, the remaining
terms,
provisions, covenants, and conditions hereof will 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 this
Agreement.
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(h)
|
Recording
of Conversations. Each
party (i)
consents to the recording of the telephone conversations of the
trading and marketing personnel of the parties in connection
with this Agreement and any potential or actual Transaction and (ii)
agrees to obtain any necessary consent of, and to give notice of such
recording to, its personnel.
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(i)
|
Consent
by Party A to Amendments to Certain Documents. Before
any amendment,
modification or supplement is made to the Indenture, the Purchase
Agreement or the Sale and Servicing Agreement that (i) would materially
adversely affect any of Party A’s rights or obligations under such
agreement, this Agreement or any Transaction or (ii) modify the
obligations or impair the ability of Party B to fully perform any
of Party
B’s obligations under this Agreement or any Transaction in such a
way that
would materially adversely affect any of Party A’s rights or obligations
under this Agreement or any Transaction, Party B will provide Party
A with
a copy of the proposed amendment, modification or supplement and
will
obtain the consent of Party A prior to its adoption, which consent
will
not be unreasonably withheld or delayed, provided that Party A’s consent
will be deemed to have been given if Party A does not object in
writing
within 10 Business Days of receipt of a written request for such
consent.
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(j)
|
Set-off.
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30
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|
(i)
|
All
payments under this Agreement
will be
made without set-off or
counterclaim, except as expressly provided for in Section 2(c),
Section 6
or Part
1(k)(ix).
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(ii)
|
Section
6(e) will 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.”
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(k)
|
Limitation
of Liability of Owner Trustee. Notwithstanding
anything contained in this Agreement to the contrary, this instrument
(and
any Confirmation pursuant to this instrument) has been or will
be signed
on behalf of Party B by U.S. Bank Trust National Association not
in its
individual capacity but solely in its capacity as Owner Trustee
of Party B
and in no event will U.S. Bank Trust National Association in its
individual capacity or any beneficial owner of Party B have any
liability
for the representations, warranties, covenants, agreements or other
obligations of Party B under this Agreement or under any such
Confirmation, as to all of which recourse will be had solely to
the assets
of Party B. For all purposes of this Agreement and any
Confirmation, in the performance of any duties or obligations of
Party B
hereunder, the Owner Trustee will be subject to, and entitled to
the
benefits of, the terms and provisions of the Trust Agreement; provided,
however,
that the foregoing will not
relieve the Owner Trustee from any liability it might otherwise
have under
the Trust Agreement as a result of its gross negligence or willful
misconduct.
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(l)
|
Definitions. Unless
otherwise specified in a Confirmation, this Agreement and the relevant
Transaction between the parties are subject to the 2006 ISDA Definitions
(the “Definitions”), as published by the International Swaps and
Derivatives Association, Inc., and will be governed in all relevant
respects by the provisions set forth in the Definitions, without
regard to
any amendment to the Definitions subsequent to the date
hereof. The provisions of the Definitions are incorporated
by reference in and will be deemed a part of this Agreement, except
that
references in the Definitions to a “Swap Transaction” will be deemed
references to a “Transaction” for purposes of this
Agreement. In the event of any inconsistency between the
provisions of this Agreement and the Definitions, this Agreement
will
prevail. In the event of any inconsistency between the
provision of any Confirmation and this Agreement or the Definitions,
such
Confirmation will prevail for the purpose of the relevant
Transaction.
|
For
the purpose of this
Agreement:
“Credit
Support Annex” means any
credit support annex entered into between Party A and Party B relating to
this
Agreement, as amended, supplemented or otherwise modified from time to
time.
“Credit
Support Document”
means
the
Credit
Support Annex and any Eligible
Guarantee for Party
A.
“Credit
Support Provider”
means
in relation to Party A, (1) Party
A in its capacity as
a party to the Credit
Support Annex and (2) the
guarantor under any Eligible Guarantee, and in relation to Party B, Party
B in
its capacity as a party to the Credit
Support Annex.
“Eligible Guarantee”
means an unconditional and irrevocable guarantee that is provided by a guarantor
that is a Financial Institution as principal debtor rather than surety and
is
directly enforceable by Party B, where (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 deduction or withholding for Tax and such opinion has
been
delivered to Xxxxx’x, (B) such guarantee provides that, in the event that any of
such guarantor’s payments to Party B are subject to deduction or 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
tax) will equal the full amount Party B would have received had no such
deduction or 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 will equal the
full
amount Party B would have received had no such deduction or withholding been
required.
31
“Eligible
Replacement” means a Financial Institution (i)(A) having the Xxxxx’x
First Trigger Required Ratings and/or the Xxxxx’x Second Trigger Required
Ratings or (B) whose present and future obligations owing to Party B are
guaranteed pursuant to an Eligible Guarantee provided by a guarantor having
the
Xxxxx’x First Trigger Required Ratings and/or the Xxxxx’x Second Trigger
Required Ratings, and (ii)(A) having the S&P’s First Trigger Required
Ratings and/or the S&P’s Second Trigger Required Ratings or (B) whose
present and future obligations owing to Party B are guaranteed pursuant to
an
Eligible Guarantee provided by a guarantor having the S&P’s First Trigger
Required Ratings and/or the S&P’s Second Trigger Required Ratings, and
(iii)(A) having the Fitch’s First Trigger Required Ratings and/or the Fitch’s
Second Trigger Required Ratings or (B) whose present and future obligations
owing to Party B are guaranteed pursuant to an Eligible Guarantee provided
by a
guarantor having the Fitch’s First Trigger Required Ratings and/or the Fitch’s
Second Trigger Required Ratings, and (iv) acceptable to Party B.
“Financial
Institution” means a bank, broker/dealer, insurance company, structured
investment vehicle or derivative product company.
“Firm
Offer” means an offer which, when made, was capable of becoming legally
binding upon acceptance.
“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.
“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.
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(m)
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Additional
Defined Terms. Capitalized
terms used but not
defined in this Agreement (including this Schedule) or any Confirmation
are defined in the Sale and Servicing Agreement, dated as of January 1,
2008(including
Appendix A to such Sale
and Servicing Agreement), as amended, supplemented or otherwise
modified,
among Party B, Ford Motor Credit Company LLC, as Servicer, and
Ford Credit
Auto Receivables Two LLC, as
Depositor.
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(i)
Fitch’s
First Rating Trigger. If no Relevant Entity
has a
short term unsecured debt rating of “F1” or better or a long term unsecured debt
rating of “A” or better by Fitch (such rating thresholds, the “Fitch
First Trigger
Required Ratings”
and
such failure, the “Fitch
First
Rating Trigger”)
and the Fitch Second Rating Trigger
has not occurred, then within 30 calendar days of such failure (or on the
date
of this Agreement, if no Relevant Entity has the Fitch First Trigger Required
Ratings as of the date of this Agreement), Party A will, at its own cost,
(A) post collateral in
the amount and manner as set forth
in the Credit Support
Annex, (B)
procure
an Eligible Guarantee in respect
of all of Party A’s present and future obligations under this Agreement to be
provided by a guarantor having the Fitch First
Trigger Required
Ratings and which procurement will not be effective without the prior written
confirmation of Fitch that such procurement will not cause Fitch to
reduce or withdraw
its then current rating on the Notes,(C)
effect
a
transfer in accordance with Part
5(p)(ii) below or (D)
establish any other arrangement satisfactory to Party B and to Fitch as to
not
cause Fitch to reduce or withdraw its then current rating on the
Notes.
32
(ii) Fitch's
Second
Rating Trigger. If
no Relevant Entity has a short term
unsecured debt rating of “F2” or better or a long term unsecured debt rating of
“BBB+” or better by Fitch (such rating thresholds, the “Fitch Second Trigger
Required Ratings” and such failure, the “Fitch
Second
Trigger
Required Ratings”),
then within 30 calendar days of such
failure, Party A will, at
its own cost, procure
either (A) an Eligible Guarantee
in respect of all of Party A’s present and future obligations under this
Agreement to be provided by a guarantor having the Fitch Second
Trigger Required
Ratings and which procurement will not be effective without the prior written
confirmation of Fitch that such procurement will not cause Fitch to
reduce or withdraw its then current rating on the Notes or (B) a transfer in
accordance
with Part 5(p)(ii)
below; provided that
Party
A will promptly post
collateral in
the amount and manner as set forth
in the Credit Support
Annex
while a replacement
or
guarantor is being sought.
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|
(o)
|
Downgrade
or Withdrawal of Party
A’s Rating by
Xxxxx’x.
|
(i)
An entity shall have the
“Xxxxx’x First
Trigger Required
Ratings”(A)
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 (B) 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.
(ii)
The “Xxxxx’x
First
Rating
Trigger Requirements” shall apply so long as no Relevant Entity has the
Xxxxx’x First Trigger Required Ratings. Within 30 Local Business Days
after the Xxxxx’x First Rating Trigger Requirements apply, Party A will, at its
own cost, (A) procure an Eligible Guarantee in respect of all of Party A’s
present and future obligations under this Agreement to be provided by a
guarantor meeting the Xxxxx’x First Trigger Required Ratings, (B) effect a
transfer in accordance with Part 5(p)(ii) below or (C) post collateral in
the
amount and manner as set forth in the Credit Support Annex.
(iii) An
entity shall have the “Xxxxx’x
Second
Trigger
Required Ratings” (A) 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 (B) 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.
(iv) The
“Xxxxx’x Second
Rating Trigger Requirements” shall
apply so long as no Relevant
Entity has the Xxxxx’x Second
Trigger Required
Ratings. Within
30 Local Business Days
after the
Xxxxx’x Second
Rating Trigger Requirements
apply, Party
A will post collateral
in the amount and manner as
set forth in the Credit
Support Annex. Party A will also, at
its own cost, use
commercially reasonable efforts to,
as soon as reasonably practicable, procure either (A) an Eligible Guarantee
in
respect of all of Party A’s present and future obligations under this Agreement
to be provided by a guarantor meeting at least the
Xxxxx’x Second
Trigger Required Ratings or (B)
a transfer in accordance
with Part 5(p)(ii) below.
33
|
|
(p)
|
(i)
Section 7 of this Agreement shall not apply to Party A and, subject to Section
6(b)(ii) and clause (ii) below, Party A may not transfer (whether by way
of
security or otherwise) any interest or obligation in or under this Agreement
without (x) the prior written consent of Party B and (y) complying with Part
5(q) below.
(ii)
subject to Part 5(q) below, if the Xxxxx’x First Rating Trigger Requirements
apply, Party A may (at its own cost) 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 such that the Transferee contracts with Party
B
on terms that (x) have the effect of preserving for Party B the economic
equivalent of all payment and delivery obligations (whether absolute or
contingent and assuming the satisfaction of each applicable condition precedent)
under this Agreement immediately before such transfer and (y) are in all
material respects no less beneficial for Party B than the terms of this
Agreement immediately before such transfer, as determined by Party B acting
in a
commercially reasonable manner.
(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) above, Party
B shall,
at Party A’s written
request and
cost, take any reasonable
steps required to be taken by it to effect such transfer.
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(q)
|
Approval
of Amendments, Transfers or Assignment. Notwithstanding
any
other provisions of this Agreement, no amendments to this Agreement
will be effected, nor may the rights and obligations of Party A
be
transferred or assigned, without the prior written
confirmation of each Rating Agency (other than
Xxxxx’x) that such amendment, transfer or assignment will not cause
such Rating Agency to reduce or withdraw its then current rating
on any of
the Notes. Notwithstanding any other provision of this
Agreement, no amendments to this Agreement, no Early Termination
Date
shall be effectively designated by Party B, and no transfer of
any rights
or obligations under this Agreement shall be made unless Xxxxx’x has been
given prior written notice of such amendment, designation or
transfer.
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(r)
|
Party
B Agent. Party
A acknowledges that Party B
has appointed Ford
Motor Credit Company LLC as its agent under the Administration
Agreement
to carry
out certain
functions on behalf of Party B, and that Ford Motor
Credit Company LLC
shall be
entitled to
give notices and to perform and satisfy the obligations of Party
B
hereunder on behalf of Party B.
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|
(s)
|
Regulation
AB Financial
Disclosure.
|
Party
A acknowledges that for so long as
there are reporting obligations with respect to any Transaction under this
Agreement under Regulation AB, the Depositor is required under Regulation
AB to
disclose certain information set forth in Regulation AB regarding Party A
or its
group of affiliated entities, if applicable, depending on the aggregate
“significance percentage” of this Agreement and any other derivative contracts
between Party A or its group of affiliated entities, if applicable, and Party
B,
as calculated from time to time in accordance with Item 1115 of Regulation
AB.
34
If
the Depositor determines, reasonably
and in good faith, that the “significance percentage” of this Agreement has
increased to 9%, then on any Business Day after the date of such determination
the Depositor may request from Party A the same information set forth in
Item
1115(b) of Regulation AB that would have been required if the significance
percentage had in fact increased to 10% (such request, a “Swap
Financial Disclosure Request” and such requested information, subject to the
last sentence of this paragraph, the “Swap Financial
Disclosure”). Party A and Party B further agree that the Swap
Financial Disclosure provided to meet the Swap Financial Disclosure Request
will
be the information set forth in Item 1115(b)(1) or Item 1115(b)(2) of Regulation
AB, as applicable.
Upon
the occurrence of a Swap Financial
Disclosure Request, Party A, at its own expense, shall within 30 days after
receipt of
such Swap Financial
Disclosure
Request (or
within
10 days after Party
A being informed of the
significance
percentage reaching 10% after such Swap Financial
Disclosure
Request): (i)
provide the Depositor with the Swap
Financial Disclosure, (ii) subject to Rating Agency Confirmation and approval
by
Party B (which approval will not be unreasonably withheld), secure another
entity to replace Party A as party to this Agreement on terms substantially
similar to this Agreement which entity is able and will provide the Swap
Financial Disclosure for such entity within the time period specified above
or
(iii) subject to Rating Agency Confirmation and approval by Party B (which
approval will not be unreasonably withheld), obtain a guaranty of Party A’s
obligations under this Agreement from an affiliate of Party A that is able
to
provide the Swap Financial Disclosure for such affiliate, such that disclosure
provided in respect of the affiliate will satisfy any disclosure requirements
applicable to Party A, and cause such affiliate to provide Swap Financial
Disclosure within the time period specified above. If permitted by
Regulation AB, any required Swap Financial Disclosure may be provided by
incorporation by reference from reports filed pursuant to the Exchange
Act.
(i)
S&P’s
First Rating Trigger. If no Relevant Entity
has a
short term unsecured debt rating of “A-1” or better by S&P or, if no
Relevant Entity has a short term unsecured debt rating by S&P, a long term
unsecured debt rating of “A+” or better by S&P (such rating thresholds, the
“S&P
First Trigger
Required Ratings”
and
such failure, the “S&P
First Rating Trigger”)
and the S&P Second Rating Trigger
has not occurred, then within 10 Local Business Days of such failure (or
on the
date of this Agreement, if no Relevant Entity has the S&P First Trigger
Required Ratings as of the date of this Agreement), Party A will, at its own cost,
post
collateral in
the amount and manner as set forth
in the Credit Support
Annex. Party
A may also,
at
its own cost, procure
either (A) an Eligible Guarantee
in respect of all of Party A’s present and future obligations under this
Agreement to be provided by a guarantor having the S&P First Trigger
Required Ratings and which procurement will not be effective without the
prior
written confirmation of S&P that such procurement will not cause S&P to
reduce or withdraw its then current rating on the Notes or (B) a transfer to
a Financial Institution in accordance with
Part 5(p)(ii)
above, and upon either
such
procurement, Party A will no longer be required to post any
collateral.
(ii)
S&P’s
Second Rating Trigger. If
no Relevant Entity has a short term
unsecured debt rating of “A-2” or better by S&P or, if no Relevant Entity
has a short term unsecured debt rating by S&P, a long term unsecured debt
rating of “BBB+” or better by S&P (such rating thresholds, the “S&P
Second
Trigger Required Ratings”
and such failure, the
“S&P
Second Rating Trigger”),
then within 10 Local Business Days
of such failure, Party A will, at its own cost,
post
additional
collateral in
the amount and manner as set forth
in the Credit Support
Annex. Party
A will also, at
its own cost, within
60 calendar days of such failure,
use commercially
reasonable efforts to
procure either (A)
an
Eligible Guarantee in respect of all of Party A’s present and future obligations
under this Agreement to be provided by a guarantor having the S&P Second Trigger
Required Ratings and
which procurement will not be
effective without the prior written confirmation of S&P that such
procurement will not cause S&P to reduce or withdraw its then current rating
on the Notes or (B) a
transfer to a Financial
Institution in accordance
with Part 5(p)(ii) above.
35
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|
(u)
|
Agency
Role of Greenwich Capital Markets, Inc. In connection
with
this Agreement, Greenwich Capital Markets, Inc. has acted as agent
of
Party A. Greenwich Capital Markets, Inc. has not guaranteed and
is not
otherwise responsible for the obligations of Party A under this
Agreement.
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(v)
|
USAPATRIOT
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.
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(w)
|
Appointment
of Collateral Agent. Party A irrevocably
appoints the Indenture Trustee as its agent and attorney-in-fact
for the
purpose of evidencing the existence and maintaining the perfection
of the
security interest granted to the Indenture Trustee for the benefit
of the
Secured Parties under the
Indenture.
|
[SIGNATURE
PAGE
FOLLOWS]
36
|
EXECUTED
BY:
|
|||||
|
FORD
CREDIT AUTO OWNER TRUST 0000-X
|
XXX
XXXXX XXXX XX XXXXXXXX PLC
|
||||
|
By:
|
U.S.
BANK TRUST NATIONAL
|
By:
|
GREENWICH
CAPITAL MARKETS,
INC.,
|
||
|
ASSOCIATION,
|
as
its Agent
|
||||
|
not
in its individual capacity
|
|||||
|
but
solely as Owner Trustee
|
By:
|
/s/
Xxxxx X. Xxxxxx
|
|||
|
Name:
|
Xxxxx
X. Xxxxxx
|
||||
|
Title:
|
Managing
Director
|
||||
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By:
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/s/
Xxxxxx Xxxxx
|
||||
|
Name:
|
Xxxxxx
Xxxxx
|
||||
|
Title:
|
Vice
President
|
|
|||
|
Date: January___,
2008
|
|||||
|
|
|||||
|
Date: January____,
2008
|
|||||
[Signature
Page to Swap Schedule]
37