ASSET REPRESENTATIONS REVIEW AGREEMENT VOLKSWAGEN AUTO LOAN ENHANCED TRUST 2023-2, as Issuer and VW CREDIT, INC., as Servicer and Clayton Fixed Income Services LLC, as Asset Representations Reviewer Dated as of November 21, 2023
Exhibit 10.5
ASSET REPRESENTATIONS REVIEW AGREEMENT
VOLKSWAGEN AUTO LOAN ENHANCED TRUST 2023-2,
as Issuer
and
VW CREDIT, INC.,
as Servicer
and
Xxxxxxx Fixed Income Services LLC,
as Asset Representations Reviewer
Dated as of November 21, 2023
TABLE OF CONTENTS
ARTICLE I. USAGE AND DEFINITIONS | 1 | |
Section 1.01 | Usage and Definitions | 1 |
Section 1.02 | Definitions | 1 |
ARTICLE II. ENGAGEMENT; ACCEPTANCE | 2 | |
Section 2.01 | Engagement; Acceptance | 2 |
Section 2.02 | Confirmation of Status | 3 |
ARTICLE III. ASSET REPRESENTATIONS REVIEW PROCESS | 3 | |
Section 3.01 | Review Notices and Identification of Subject Receivables | 3 |
Section 3.02 | Review Materials | 3 |
Section 3.03 | Performance of Reviews | 4 |
Section 3.04 | Review Report | 5 |
Section 3.05 | Review Representatives | 5 |
Section 3.06 | Dispute Resolution | 6 |
Section 3.07 | Limitations on Review Obligations | 6 |
ARTICLE IV. ASSET REPRESENTATIONS REVIEWER | 6 | |
Section 4.01 | Representations, Warranties and Covenants of the Asset Representations Reviewer | 6 |
Section 4.02 | Fees and Expenses | 7 |
ARTICLE V. OTHER MATTERS PERTAINING TO THE ASSET REPRESENTATIONS REVIEWER | 8 | |
Section 5.01 | Limitation on Liability | 8 |
Section 5.02 | Indemnification by Servicer | 9 |
Section 5.03 | Indemnification by Asset Representations Reviewer | 9 |
Section 5.04 | Inspections of Asset Representations Reviewer | 9 |
Section 5.05 | Delegation of Obligations | 10 |
ARTICLE VI. TREATMENT OF CONFIDENTIAL INFORMATION | 10 | |
Section 6.01 | Confidential Information | 10 |
Section 6.02 | Personally Identifiable Information | 11 |
ARTICLE VII. REMOVAL, RESIGNATION | 13 | |
Section 7.01 | Eligibility of the Asset Representations Reviewer | 13 |
Section 7.02 | Resignation and Removal of Asset Representations Reviewer | 13 |
Section 7.03 | Successor Asset Representations Reviewer | 14 |
Section 7.04 | Merger, Consolidation or Succession | 14 |
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ARTICLE VIII. OTHER AGREEMENTS | 15 | |
Section 8.01 | Independence of the Asset Representations Reviewer | 15 |
Section 8.02 | No Petition | 15 |
Section 8.03 | Limitation of Liability of Owner Trustee | 15 |
Section 8.04 | Termination of Agreement | 16 |
ARTICLE IX. MISCELLANEOUS PROVISIONS | 16 | |
Section 9.01 | Amendments | 16 |
Section 9.02 | Assignment; Benefit of Agreement; Third Party Beneficiaries | 17 |
Section 9.03 | Notices | 17 |
Section 9.04 | Governing Law | 17 |
Section 9.05 | Submission to Jurisdiction; Waiver of Jury Trial | 18 |
Section 9.06 | No Waiver; Remedies | 18 |
Section 9.07 | Severability | 18 |
Section 9.08 | Headings | 18 |
Section 9.09 | Counterparts | 19 |
Section 9.10 | Electronic Signatures and Transmission | 19 |
Schedule A β Representations and Warranties, Review Materials and Tests
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This ASSET REPRESENTATIONS REVIEW AGREEMENT (this βAgreementβ), entered into as of November 21, 2023, by and among VOLKSWAGEN AUTO LOAN ENHANCED TRUST 2023-2, a Delaware statutory trust, as issuer (the βIssuerβ), VW CREDIT, INC., a Delaware corporation (βVCIβ), as servicer (in such capacity, the βServicerβ) and Xxxxxxx Fixed Income Services LLC, a Delaware limited liability company, as asset representations reviewer (the βAsset Representations Reviewerβ).
WHEREAS, in connection with a securitization transaction sponsored by VCI, VCI sold a pool of Receivables consisting of retail installment sale contracts to Volkswagen Auto Lease/Loan Underwritten Funding, LLC (the βDepositorβ), who sold them to the Issuer;
ARTICLE I.
USAGE AND DEFINITIONS
Section 1.01 Usage and Definitions.
Except as otherwise defined herein or as the context may otherwise require, capitalized terms used but not otherwise defined herein are defined in Appendix A to the Sale and Servicing Agreement, dated as of the date hereof (as from time to time amended, supplemented or otherwise modified and in effect, the βSale and Servicing Agreementβ) among the Issuer, the Servicer, the Depositor, as seller, and the Indenture Trustee, which also contains rules as to usage that are applicable herein.
Section 1.02 Definitions.
Whenever used in this Agreement, the following words and phrases shall have the following meanings:
βAnnual Feeβ has the meaning stated in Section 4.02(a).
βAsset Reviewβ means the completion by the Asset Representations Reviewer of the testing procedures for each Test and for each Subject Receivable as further described in Section 3.03.
βConfidential Informationβ has the meaning stated in Section 6.01(b).
βEligible Representationsβ shall mean those representations identified on Schedule A attached hereto.
βInformation Recipientsβ has the meaning stated in Section 6.01(a).
βIndentureβ means the Indenture, dated as of November 21, 2023, between the Issuer and the Indenture Trustee, as the same may be amended, supplemented or modified from time to time.
βIndenture Trusteeβ means Citibank, N.A., as indenture trustee under the Indenture, and any successor thereto.
βIssuer PIIβ has the meaning stated in Section 6.02(a).
βPIIβ has the meaning stated in Section 6.02(a).
βReview Feeβ has the meaning stated in Section 4.02(b).
βReview Materialsβ means the documents, data, and other information required for each Test listed under βDocumentsβ in Schedule A.
βReview Noticeβ means a notice delivered to the Asset Representations Reviewer by the Indenture Trustee pursuant to Section 7.5(b) of the Indenture.
βReview Reportβ means, for an Asset Review, the report of the Asset Representations Reviewer prepared according to Section 3.04.
βTestβ has the meaning stated in Section 3.03(a).
βTest Completeβ has the meaning stated in Section 3.03(c).
βTest Failβ has the meaning stated in Section 3.03(a).
βTest Incompleteβ has the meaning stated in Section 3.03(a).
βTest Passβ has the meaning stated in Section 3.03(a).
ARTICLE II.
Section 2.01 Engagement; Acceptance.
The Issuer hereby engages Xxxxxxx Fixed Income Services LLC to act as the Asset Representations Reviewer for the Issuer. Xxxxxxx Fixed Income Services LLC accepts the engagement and agrees to perform the obligations of the Asset Representations Reviewer on the terms stated in this Agreement.
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Section 2.02 Confirmation of Status.
The parties confirm that the Asset Representations Reviewer is not responsible for (a) reviewing the Receivables for compliance with the representations and warranties under the Transaction Documents, except as described in this Agreement, or (b) determining whether noncompliance with the representations or warranties constitutes a breach of the Transaction Documents.
ARTICLE III.
ASSET REPRESENTATIONS REVIEW PROCESS
Section 3.01 Review Notices and Identification of Subject Receivables.
(a) On receipt of a Review Notice from the Indenture Trustee according to Section 7.5(b) of the Indenture, the Asset Representations Reviewer will start an Asset Review. The Asset Representations Reviewer will not be obligated to start an Asset Review until a Review Notice is received.
(b) Within ten (10) Business Days after receipt of a Review Notice, the Servicer will deliver to the Asset Representations Reviewer, with a copy to the Indenture Trustee, a list of the Subject Receivables. The Asset Representations Reviewer will not be obligated to start an Asset Review until a Review Notice and the related list of Subject Receivables is received. The Asset Representations Reviewer is not obligated to verify (i) whether the Indenture Trustee properly determined that a Review Notice was required or (ii) the accuracy or completeness of the list of Subject Receivables provided by the Servicer.
Section 3.02 Review Materials.
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Section 3.03 Performance of Reviews.
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Within ten (10) calendar days after the end of the applicable Asset Review period under Section 3.03(b), the Asset Representations Reviewer will deliver to the Issuer, the Servicer, and the Indenture Trustee a Review Report indicating for each Subject Receivable whether there was a Test Pass, Test Incomplete, Test Fail or Test Complete for each related Test. For each Test Fail or Test Complete, the Review Report will indicate the related reason. The Review Report will contain the findings and conclusions of the Asset Representations Reviewer with respect to the Asset Review, and will be included in the Issuerβs Form 10-D report for the Collection Period in which the Review Report is received. The Asset Representations Reviewer will ensure that the Review Report does not contain any PII. On reasonable request of the Servicer, the Asset Representations Reviewer will provide additional details on the Test results.
Section 3.05 Review Representatives.
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Section 3.06 Dispute Resolution.
If a Subject Receivable that was the subject of an Asset Review becomes the subject of a dispute resolution proceeding under Section 9.24 of the Sale and Servicing Agreement, the Asset Representations Reviewer will participate in the dispute resolution proceeding on request of a party to the proceeding. The reasonable out-of-pocket expenses of the Asset Representations Reviewer for its participation in any dispute resolution proceeding will be considered expenses of the Requesting Party for the dispute resolution and will be paid by a party to the dispute resolution as determined by the mediator or arbitrator for the dispute resolution according to Section 9.24 of the Sale and Servicing Agreement. If not paid by a party to the dispute resolution, the expenses will be reimbursed according to Section 4.02(c) of this Agreement.
Section 3.07 Limitations on Review Obligations.
ARTICLE IV.
ASSET REPRESENTATIONS REVIEWER
Section 4.01 Representations, Warranties and Covenants of the Asset Representations Reviewer.
The Asset Representations Reviewer hereby makes the following representations, warranties and covenants as of the Closing Date:
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Section 4.02 Fees and Expenses.
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ARTICLE V.
OTHER MATTERS PERTAINING TO THE ASSET REPRESENTATIONS REVIEWER
Section 5.01 Limitation on Liability.
The Asset Representations Reviewer will not be liable to any Person for any action taken, or not taken, in good faith under this Agreement or for errors in judgment. However, the Asset Representations Reviewer will be liable for its willful misconduct, bad faith, breach of this Agreement or negligence in performing its obligations under this Agreement. In no event will the Asset Representations Reviewer be liable for special, indirect or consequential losses or damages (including lost profit), even if the Asset Representations Reviewer has been advised of the likelihood of the loss or damage and regardless of the form of action.
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Section 5.02 Indemnification by Servicer.
The Servicer shall indemnify the Asset Representations Reviewer against any and all loss, liability or expense (including reasonable attorneysβ fees) incurred by it in connection with the administration of this Agreement and the performance of its duties hereunder. The Asset Representations Reviewer shall notify the Servicer promptly of any claim for which it may seek indemnity. Failure by the Asset Representations Reviewer to so notify the Servicer shall not relieve the Servicer of its obligations hereunder. The Servicer shall defend any such claim, and the Asset Representations Reviewer may have separate counsel and the Servicer shall pay the fees and expenses of such counsel. The Servicer shall not reimburse any expense or indemnify against any loss, liability or expense incurred by the Asset Representations Reviewer arising out of or resulting from the Asset Representations Reviewerβs own bad faith, negligence, willful misfeasance or breach of this Agreement. The Servicerβs obligations under this Section 5.02 will survive the termination of this Agreement, the termination of the Issuer and the resignation or removal of the Asset Representations Reviewer.
Section 5.03 Indemnification by Asset Representations Reviewer.
The Asset Representations Reviewer will indemnify each of the Issuer, the Seller, the Servicer, the Administrator, the Owner Trustee and the Indenture Trustee and their respective directors, officers, employees and agents for all fees, expenses, losses, damages and liabilities resulting from (a) the willful misconduct, bad faith or negligence of the Asset Representations Reviewer in performing its obligations under this Agreement and (b) the Asset Representations Reviewerβs breach of any of its representations or warranties in this Agreement. The Asset Representations Reviewerβs obligations under this Section 5.03 will survive the termination of this Agreement, the termination of the Issuer and the resignation or removal of the Asset Representations Reviewer.
Section 5.04 Inspections of Asset Representations Reviewer.
The Asset Representations Reviewer agrees that, with reasonable advance notice not more than once during any year, it will permit authorized representatives of the Issuer or the Servicer, during the Asset Representations Reviewer's normal business hours, to examine and review the books of account, records, reports and other documents and materials of the Asset Representations Reviewer relating to (a) the performance of the Asset Representations Reviewer's obligations under this Agreement, (b) payments of fees and expenses of the Asset Representations Reviewer for its performance and (c) a claim made by the Asset Representations Reviewer under this Agreement. In addition, the Asset Representations Reviewer will permit the Issuer's or the Servicer's representatives to make copies and extracts of any of those documents and to discuss them with the Asset Representations Reviewer's officers and employees. Each of the Issuer and the Servicer will, and will cause its authorized representatives to, hold in confidence the information except if disclosure may be required by law or if the Issuer or the Servicer reasonably determines that it is required to make the disclosure under this Agreement or the other Transaction Documents. The Asset Representations Reviewer will maintain all relevant books, records, reports and other documents and materials for a period of at least two years after the termination of its obligations under this Agreement.
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Section 5.05 Delegation of Obligations.
The Asset Representations Reviewer may not delegate or subcontract its obligations under this Agreement to any Person without the consent of the Issuer and the Servicer.
ARTICLE VI.
TREATMENT OF CONFIDENTIAL INFORMATION
Section 6.01 Confidential Information.
(i) lists of Subject Receivables and any related Review Materials;
(ii) origination and servicing guidelines, policies and procedures, and form contracts; and
(iii) notes, analyses, compilations, studies or other documents or records prepared by the Servicer, which contain information supplied by or on behalf of the Servicer or its representatives.
However, Confidential Information will not include information that (A) is or becomes generally available to the public other than as a result of disclosure by the Information Recipients, (B) was available to, or becomes available to, the Information Recipients on a non-confidential basis from a Person or entity other than the Issuer or the Servicer before its disclosure to the Information Recipients who, to the knowledge of the Information Recipient is not bound by a confidentiality agreement with the Issuer or the Servicer and is not prohibited from transmitting the information to the Information Recipients, (C) is independently developed by the Information Recipients without the use of the Confidential Information, as shown by the Information Recipients' files and records or other evidence in the Information Recipients' possession or (D) the Issuer or the Servicer provides permission to the applicable Information Recipients to release.
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(i) The Asset Representations Reviewer will not disclose Issuer PII to its personnel or allow its personnel access to Issuer PII except (A) for the Asset Representations Reviewer personnel who require Issuer PII to perform an Asset Review, (B) with the prior consent of the Issuer or (C) as required by applicable law. When permitted, the disclosure of or access to Issuer PII will be limited to the specific information necessary for the individual to complete the assigned task. The Asset Representations Reviewer will inform personnel with access to Issuer PII of the confidentiality requirements in this Agreement and train its personnel with access to Issuer PII on the proper use and protection of Issuer PII.
(ii) The Asset Representations Reviewer will not sell, disclose, provide or exchange Issuer PII with or to any third party without the prior consent of the Issuer.
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ARTICLE VII.
Section 7.01 Eligibility of the Asset Representations Reviewer.
The Asset Representations Reviewer must be a Person who (a) is not Affiliated with VCI, the Depositor, the Servicer, the Indenture Trustee, the Owner Trustee or any of their Affiliates and (b) was not, and is not Affiliated with a Person that was, engaged by the Sponsor or any underwriter to perform any due diligence on the Receivables prior to the Closing Date.
Section 7.02 Resignation and Removal of Asset Representations Reviewer.
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(i) the Asset Representations Reviewer no longer meets the eligibility requirements in Section 7.01;
(ii) the Asset Representations Reviewer breaches of any of its representations, warranties, covenants or obligations in this Agreement; or
(iii) a Bankruptcy Event of the Asset Representations Reviewer occurs.
Section 7.03 Successor Asset Representations Reviewer.
Section 7.04 Merger, Consolidation or Succession.
Any Person (a) into which the Asset Representations Reviewer is merged or consolidated, (b) resulting from any merger or consolidation to which the Asset Representations Reviewer is a party or (c) succeeding to the business of the Asset Representations Reviewer, if that Person meets the eligibility requirements in Section 7.01, will be the successor to the Asset Representations Reviewer under this Agreement. Such Person will execute and deliver to the Issuer and the Servicer an agreement to assume the Asset Representations Reviewerβs obligations under this Agreement (unless the assumption happens by operation of law).
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ARTICLE VIII.
Section 8.01 Independence of the Asset Representations Reviewer.
The Asset Representations Reviewer will be an independent contractor and will not be subject to the supervision of, or deemed to be the agent of, the Issuer, the Indenture Trustee or the Owner Trustee for the manner in which it accomplishes the performance of its obligations under this Agreement. None of the Issuer, the Indenture Trustee or the Owner Trustee shall be responsible for monitoring the performance of the Asset Representations Reviewer or liable to any Person for the failure of the Asset Representations Reviewer to perform its obligations hereunder. Unless authorized by the Issuer, the Indenture Trustee or the Owner Trustee, respectively, the Asset Representations Reviewer will have no authority to act for or represent the Issuer, the Indenture Trustee or the Owner Trustee and will not be considered an agent of the Issuer, the Indenture Trustee or the Owner Trustee. Nothing in this Agreement will make the Asset Representations Reviewer and either of the Issuer, the Indenture Trustee or the Owner Trustee members of any partnership, joint venture or other separate entity or impose any liability as such on any of them.
Each party hereto agrees that, prior to the date which is one year and one day after payment in full of all obligations of each Bankruptcy Remote Party in respect of all securities issued by any Bankruptcy Remote Party (a) such party hereto shall not authorize any Bankruptcy Remote Party to commence a voluntary winding-up or other voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to such Bankruptcy Remote Party or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect in any jurisdiction or seeking the appointment of an administrator, a trustee, receiver, liquidator, custodian or other similar official with respect to such Bankruptcy Remote Party or any substantial part of its property or to consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against such Bankruptcy Remote Party, or to make a general assignment for the benefit of its creditors generally, any party hereto or any other creditor of such Bankruptcy Remote Party, and (b) such party shall not commence or join with any other Person in commencing any proceeding against such Bankruptcy Remote Party under any bankruptcy, reorganization, liquidation or insolvency law or statute now or hereafter in effect in any jurisdiction. This Section 8.02 shall survive the termination of this Agreement.
Section 8.03 Limitation of Liability of Owner Trustee.
Notwithstanding anything contained herein to the contrary, (a) this Agreement has been executed and delivered by U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee on behalf of the Issuer, in the exercise of the powers and authority conferred and vested in it, pursuant to the Trust Agreement, (b) each of the representations, warranties, covenants, undertakings and agreements herein made on the part of the Issuer is made and intended not as personal representations, warranties, covenants, undertakings and agreements by U.S. Bank Trust National Association but is made and intended for the purpose of binding only, and is only binding on, the Issuer, (c) nothing herein contained shall be construed as creating any liability on U.S. Bank Trust National Association, individually or personally or as Owner Trustee, to perform any covenant either expressed or implied contained herein of the Issuer, all such liability, if any, being expressly waived by the parties hereto and by any Person claiming by, through or under the parties hereto, (d) U.S. Bank Trust National Association has made no investigation and shall make no investigation as to the accuracy or completeness of any representations and warranties made by the Issuer in this Agreement and (e) under no circumstances shall U.S. Bank Trust National Association be personally liable for the payment of any indebtedness, indemnities or expenses of the Issuer or be liable for the performance, breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Issuer under this Agreement or under the Notes or any other related documents or in any of the certificates, notices or agreements delivered pursuant thereto, as to all of which recourse shall be had solely to the assets of the Issuer. For the purposes of this Agreement, in the performance of any duty or obligation on behalf of the Issuer hereunder, the Owner Trustee shall be entitled to all rights, protections, indemnities, and immunities in the Trust Agreement.
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Section 8.04 Termination of Agreement.
This Agreement will terminate, except for the obligations under Article VI and Sections 5.02 and 5.03, on the earlier of (a) the payment in full of all outstanding Notes and the satisfaction and discharge of the Indenture and (b) the date the Issuer is terminated under the Trust Agreement.
ARTICLE IX.
(a) Any term or provision of this Agreement may be amended by the Servicer and the Asset Representations Reviewer without the consent of the Indenture Trustee, any Noteholder, the Issuer, the Owner Trustee or any other Person subject to the satisfaction of one of the following conditions:
(i) | the Servicer delivers an Opinion of Counsel to the Indenture Trustee to the effect that such amendment will not materially and adversely affect the interests of the Noteholders; |
(ii) | the Servicer delivers an Officerβs Certificate to the Indenture Trustee to the effect that such amendment will not materially and adversely affect the interests of the Noteholders; or |
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(iii) | the Rating Agency Condition is satisfied with respect to such amendment and the Servicer notifies the Indenture Trustee in writing that the Rating Agency Condition is satisfied with respect to such amendment; |
provided, that no amendment pursuant to this Section 9.01 shall be effective which affects the rights, protections or duties of the Indenture Trustee or the Owner Trustee without the prior written consent of such Person.
(b) This Agreement may also be amended from time to time by the Servicer and the Asset Representations Reviewer with the consent of the Holders of Notes evidencing not less than a majority of the aggregate principal balance of the Outstanding Notes for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders. It will not be necessary for the consent of Noteholders to approve the particular form of any proposed amendment or consent, but it will be sufficient if such consent approves the substance thereof. The manner of obtaining such consents (and any other consents of Noteholders provided for in this Agreement) and of evidencing the authorization of the execution thereof by Noteholders will be subject to such reasonable requirements as the Indenture Trustee may prescribe, including the establishment of record dates pursuant to the Note Depository Agreement.
Section 9.02 Assignment; Benefit of Agreement; Third Party Beneficiaries.
All demands, notices and communications hereunder shall be in writing and shall be delivered or mailed by registered or certified first-class United States mail, postage prepaid, hand delivery, prepaid courier service, via electronic mail, or by facsimile and addressed in each case as specified on Schedule II to the Sale and Servicing Agreement, or at such other address as shall be designated in a written notice to the other parties hereto.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL, SUBSTANTIVE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE RULES THEREOF RELATING TO CONFLICTS OF LAW, OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
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Section 9.05 Submission to Jurisdiction; Waiver of Jury Trial.
Each of the parties hereto hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or proceeding relating to this Agreement or any documents executed and delivered in connection herewith, or for recognition and enforcement of any judgment in respect thereof, to the nonexclusive general jurisdiction of the courts of the State of New York, the courts of the United States of America for the Southern District of New York and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought and maintained in such courts and waives any objection that it may now or hereafter have to the venue of such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such Person at its address determined in accordance with Section 9.03;
(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and to the extent permitted by applicable law, each party hereto irrevocably waives all right of trial by jury in any action, proceeding or counterclaim based on, or arising out of, under or in connection with this Agreement, any other Transaction Document, or any matter arising hereunder or thereunder.
Section 9.06 No Waiver; Remedies.
No partyβs failure or delay in exercising a power, right or remedy under this Agreement will operate as a waiver. No single or partial exercise of a power, right or remedy will preclude any other or further exercise of the power, right or remedy or the exercise of any other power, right or remedy. The powers, rights and remedies under this Agreement are in addition to any powers, rights and remedies under law.
If a part of this Agreement is held invalid, illegal or unenforceable, then it will be deemed severable from the remaining Agreement and will not affect the validity, legality or enforceability of the remaining Agreement.
The headings in this Agreement are included for convenience and will not affect the meaning or interpretation of this Agreement.
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This Agreement may be executed in any number of counterparts, including in counterparts executed via electronic signature, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by electronic transmission shall be effective as delivery of a manually executed counterpart of this Agreement.
Section 9.10 Electronic Signatures and Transmission.
(a) For purposes of this Agreement, any reference to βwrittenβ or βin writingβ means any form of written communication, including, without limitation, electronic signatures, and any such written communication may be transmitted by electronic transmission. The term βelectronic signatureβ shall mean any electronic symbol or process attached to, or associated with, a contract or other record and adopted by a person with the intent to sign, authenticate or accept such contract or record. Each of the parties hereto agrees that this Agreement, any addendum or amendment hereto or any other document necessary for the consummation of the transactions contemplated by this Agreement may be accepted, executed or agreed to through the use of an electronic signature in accordance with the E-Sign Act, UETA or any applicable state law. Each of the parties hereto are authorized to accept written instructions, directions, reports, notices or other communications delivered by electronic transmission and shall not have any duty or obligation to verify or confirm that the Person sending instructions, directions, reports, notices or other communications or information by electronic transmission is, in fact, a Person authorized to give such instructions, directions, reports, notices or other communications or information on behalf of the party purporting to send such electronic transmission; and none of the parties hereto shall have any liability for any losses, liabilities, costs or expenses incurred or sustained by any party as a result of such reliance upon or compliance with such instructions, directions, reports, notices or other communications or information delivered to such party, including, without limitation, the risk of such party acting on unauthorized instructions, notices, reports or other communications or information, and the risk of interception and misuse by third parties.
(b) Any requirement in this Agreement that a document, including this Agreement, is to be signed or authenticated by βmanual signatureβ or similar language shall not be deemed to prohibit signature by facsimile or electronic signature and shall not be deemed to prohibit delivery thereof by electronic transmission.
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Volkswagen Auto Loan Enhanced Trust 2023-2, as Issuer | ||
By: | U.S. Bank Trust National Association, not in its individual capacity, but solely as Owner Trustee | |
By: | /s/ Xxxx X. Xxxxxxx | |
Name: Xxxx X. Xxxxxxx | ||
Title: Vice President | ||
VW Credit, Inc., | ||
as Servicer | ||
By: | /s/ Xxxx Xxxxxxxxx | |
Name: Xxxx Xxxxxxxxx | ||
Title: Treasurer | ||
By: | /s/ Xxxxxx Xxxxx | |
Name: Xxxxxx Xxxxx | ||
Title: Assistant Treasurer | ||
Xxxxxxx Fixed Income Services LLC, | ||
as Asset Representations Reviewer | ||
By: | /s/ Xxxxxxx Xxxxx | |
Name: Xxxxxxx Xxxxx | ||
Title: Senior Vice President |
Schedule A
REPRESENTATIONS AND WARRANTIES, REVIEW MATERIALS AND TESTS
Characteristics of Receivables (a): Each Receivable:
(i) | has been fully executed by the Obligor thereto; |
(ii) | has either (A) been originated by a Dealer located in the United States to finance the sale by a Dealer of the related Financed Vehicle and has been purchased by the Originator or (B) has been originated or acquired by the Originator; |
(iii) | as of the Closing Date is secured by a first priority perfected security interest in the Financed Vehicle in favor of the Originator, as secured party, or all necessary actions have been commenced that would result in a first priority validly perfected security interest in the Financed Vehicle in favor of the Originator, as secured party; |
(iv) | contains provisions that permit the repossession and sale of the Financed Vehicle upon a default under the Receivable by the Obligor; |
(v) | provided, at origination, for level monthly payments which fully amortize the initial Outstanding Principal Balance over the original term; provided, that the amount of the first and last payments may be different but in no event more than three times the level monthly payment; |
(vi) | provides for interest at the Contract Rate specified in the Schedule of Receivables; and |
(vii) | was denominated in Dollars. |
(i) | Retail contract |
(ii) | Title documents |
(iii) | System screenprint |
Procedures to be Performed
(i) | Fully Executed |
(A) | Confirm there is a signature of the appropriate Obligor on the contract. |
(ii) | Origination of Receivable |
(A) | Confirm the Receivable was either originated by a Dealer or Originator or acquired by the Originator. |
(B) | If originated by a Dealer, confirm the Dealerβs address is in the United States. |
(C) | If originated by a Dealer, confirm the Receivable was assigned by the Dealer to the Originator. |
(iii) | First Priority Interest |
(A) | Confirm the contract contains language regarding the creation of an enforceable security interest. |
(B) | Confirm that a Certificate of Title lists VCI, or an acceptable variation of its name, as primary lienholder or that an application for a Certificate of Title has been filed in the applicable state listing VCI, or an acceptable variation of its name, as primary lienholder. |
(C) | Confirm that the Obligorβs name, or an acceptable variation thereof, on the contract matches the name on the title documents. |
(D) | Confirm that the Vehicle Identification Number (VIN) on the contract matches the VIN on the title documents. |
(E) | Confirm the Receivable is listed on the Schedule of Receivables. |
(iv) | Repossession |
(A) | Observe the contract and confirm it contains provisions that permit the repossession and sale of the Financed Vehicle upon a default under the Receivable by the Obligor. |
(v) | Payment Schedule Structure |
(A) | Confirm all payments are equivalent with the possible exception of the first and last monthβs payments which may differ by no more than three times the amount of the level monthly payment. |
(B) | Confirm that the number of payments and the amount of payments, together with any first and last monthβs payment (if applicable), equals the Total of the Payments as stated within the Truth and Lending section of the contract. |
(vi) | Contract Rate |
(A) | Review the system screenprint and confirm the Contract Rate matches the Contract Rate in the Schedule of Receivables. |
(vii) | Dollar Denomination |
(A) | Review the retail contract and confirm the amount is denominated in Dollars. |
(viii) | If steps (i) through (vii) are confirmed, then Test Pass. |
Individual Characteristics (b): Each Receivable has the following individual characteristics as of the Cut-Off Date:
(i) | each Receivable is secured by a new or used automobile, minivan or sport utility vehicle; |
(ii) | each Receivable has a Contract Rate of no less than 0.00%; |
(iii) | each Receivable had an original term to maturity of not more than 75 months and not less than 12 months and each Receivable has a remaining term to maturity, as of the Cut-Off Date, of 3 months or more; |
(iv) | each Receivable has an Outstanding Principal Balance as of the Cut-Off Date of greater than or equal to $1,000; |
(v) | no Receivable has a scheduled maturity date later than September 30, 2029; |
(vi) | no Receivable was more than 30 days past due as of the Cut-Off Date; |
(vii) | as of the Cut-Off Date, no Receivable was noted in the records of VCI or the Servicer as being the subject of any pending bankruptcy or insolvency proceeding; |
(viii) | no Receivable is subject to a force-placed Insurance Policy on the related Financed Vehicle; and |
(ix) | each Receivable is a Simple Interest Receivable. |
(i) | Retail contract |
(ii) | System screenprint |
(i) | Financed Vehicle |
(A) | Review the contract and confirm that the Financed Vehicle is new or used automobile, minivan or sport utility vehicle. |
(ii) | Contract Rate |
(A) | Review the system screenprint and confirm the Contract Rate is not less than the minimum allowable Contract Rate. |
(iii) | Original Term and Remaining Term |
(A) | Review the contract and confirm the number of payments (including first and last payments) does not exceed the maximum allowable contract term of no more than 75 months. |
(B) | Review the contract and confirm the number of payments (including first and last payments) is within the allowable limits of no less than 12 months. |
(C) | Review the system screenprint and confirm that, as of the Cut-Off Date, the remaining term to maturity of the contract is no less than 3 months. |
(iv) | Remaining Balance |
(A) | Review the system screenprint and confirm that the unpaid balance as of the Cut-Off Date is not less than the minimum allowable Outstanding Principal Balance. |
(v) | maturity date |
(A) | Review the system screenprint and confirm that the Receivable has a maturity date on or before September 30, 2029. |
(vi) | Delinquency Status |
(A) | Review the system screenprint and confirm that the Receivable is not more than 30 days past due as of the Cut-Off Date. |
(vii) | Bankruptcy and Insolvency |
(A) | Verify through the system screenprint that there is no evidence the Receivable is the subject of a bankruptcy or insolvency proceeding. |
(viii) | Force-Placed Insurance |
(A) | Verify through the system screenprint that the Receivable did not have a force-placed Insurance Policy. |
(ix) | Interest Method |
(A) | Review the contract and confirm that the Receivable is amortized using the Simple Interest Method. |
(x) | If steps (i) through (ix) are confirmed, then Test Pass. |
Compliance with Law (c): The Receivable complied, at the time it was originated or made, in all material respects with all requirements of law in effect at that time and applicable to such Receivable.
(i) | Retail contract |
(ii) | List of approved contract forms |
(iii) | System screenprint |
(i) | Observe the contract and confirm the form number and revision date are on the list of approved contract Forms. |
(ii) | Confirm the following disclosures are included in the contract: |
(A) | Prepayment disclosure |
(B) | Late payment policy including the late charge amount (or calculation) |
(C) | Security interest disclosure |
(D) | Contract reference |
(E) | Insurance requirements |
(iii) | Review the system screenprint and confirm that there is no evidence of any judgment against VCI indicating that the contract was originated in violation of applicable law. |
(iv) | Review the system screenprint and confirm that there is no evidence of any Obligor(s) alleging non-compliance. |
(v) | If steps (i) through (iv) are confirmed, then Test Pass. |
Binding Obligation (d): The Receivable constitutes the legal and binding payment obligation in writing of the Obligor, enforceable by the holder thereof in all material respects, subject as to enforcement, to applicable bankruptcy, insolvency, reorganization, liquidation or other laws and equitable principles, consumer protection laws and the Servicemembers Civil Relief Act.
(i) | Retail contract |
(ii) | List of approved forms |
(i) | Confirm that the contract form number and revision date are on the list of approved contract forms. |
(ii) | Confirm that the Obligor(s) signed the contract. |
(iii) | If steps (i) and (ii) are confirmed, then Test Pass. |
Receivable in Force (e): As of the Cut-Off Date, neither VCIβs nor the Servicerβs records related to the Receivable indicate that the Receivable has been satisfied, subordinated or rescinded or that the related Financed Vehicle been released from the lien granted by the Receivable in whole or in part.
(i) | Title documents |
(ii) | System screenprint |
(i) | Confirm there is no indication within the title documents or the system screenprint that the Receivable was satisfied. |
(ii) | Confirm there is no indication within the title documents or the system screenprint that the Receivable was subordinated or rescinded. |
(iii) | Confirm there is no indication within the title documents or the system screenprint that the Financed Vehicle has been released from the Lien in whole or in part. |
(iv) | Confirm that the Receivable is noted as βactiveβ within the system screenprint. |
(v) | If steps (i) through (iv) are confirmed, then Test Pass. |
No Default (f): Except for payment delinquencies continuing for a period of not more than 30 days as of the Cut-Off Date, the records of the Servicer did not disclose that any default, breach, violation or event permitting acceleration under the terms of the Receivable existed as of the Cut-Off Date or that any continuing condition that with notice or lapse of time, or both, would constitute a default, breach, violation or event permitting acceleration under the terms of the Receivable as of the Cut-Off Date.
(i) | System screenprint |
(i) | Observe the system screenprint and confirm there is no indication of a default, breach, violation or event that would permit acceleration under the terms of the Receivable except for payment default within 30 days of the Cut-Off Date. |
(ii) | Confirm that no continuing condition (other than payment delinquencies continuing for a period of not more than 30 days as of the Cut-Off Date) would constitute a default, breach, violation or event permitting acceleration under the terms of the Receivable. |
(iii) | If steps (i) and (ii) are confirmed, then Test Pass. |
Insurance (g): The Receivable requires the Obligor thereunder to insure the Financed Vehicle under a physical damage insurance policy.
Documents
(i) | Retail contract |
(i) | Confirm the contract contains language that requires the Obligor(s) to obtain and maintain physical damage insurance covering the Financed Vehicle. |
(ii) | If step (i) is confirmed, then Test Pass. |
No Government Obligor (h): The Obligor on the Receivable is not listed on VCIβs records as the United States of America or any state thereof or any local government, or any agency, department, political subdivision or instrumentality of the United States of America or any state thereof or any local government.
Documents
(i) | Retail contract. |
(i) | Confirm the Buyer section of the contract includes the name of a natural person. |
(ii) | If the Buyer section of the contract does not report a natural personβs name, confirm internet search results show no indication the Buyer is the United States of America or any State, or any agency, department or instrumentality of the United States of America or any State. |
(iii) | If step (i) or (ii) is confirmed, then Test Pass. |
Assignment (i): The terms of the Receivable do not prohibit the sale, transfer or assignment of such Receivable or the grant of a security interest in such Receivable under the Indenture.
(i) | Retail contract |
(ii) | List of approved forms |
(i) | Confirm that the contract form number and revision date are included on the list of approved forms. |
(ii) | Confirm that the contract does not contain language that limits the sale or transfer of the Receivable. |
(iii) | If (i) and (ii) are confirmed, then Test Pass. |
Representation
Good Title (j): Immediately prior to the transfers and assignments herein contemplated, VCI had good and marketable title to each Receivable free and clear of all Liens (except Permitted Liens and any Lien that will be released prior to the assignment of such Receivable hereunder), and, immediately upon the transfer thereof to the Purchaser, the Purchaser will have good and marketable title to each Receivable, free and clear of all Liens except Permitted Liens.
(i) | Retail contract |
(ii) | Title documents |
(i) | Review the contract and confirm that the Receivable has not been assigned to any party other than VCI (or an acceptable variation of the name). |
(ii) | Observe the title documents and confirm they report VCI, or an acceptable variation of its name, as the first lien holder. |
(iii) | If steps (i) and (ii) are confirmed, then Test Pass. |
Receivable Files (k): There is only one original executed copy of each βtangible recordβ constituting or forming a part of such Receivable that is tangible chattel paper and a single βauthoritative copyβ (as such term is used in Section 9-105 of the UCC) of each electronic record constituting or forming a part of such Receivable that is electronic chattel paper. The Receivable Files that constitute or evidence such Receivable do not have any marks or notations indicating that the Receivable has been pledged, assigned or otherwise conveyed by VCI to any Person other than to a party to the Transaction Documents.
(i) | Retail contract |
(i) | Confirm there is a signature of the appropriate Obligor(s) on the contract. |
(ii) | Confirm that the contract either constitutes an electronically authenticated original, or is marked βAuthoritative Copy.β |
(iii) | Confirm no marks or notations on contract indicating that it has been pledged, assigned or otherwise conveyed to any Person other than a party to the Transaction Documents. |
(iv) | If steps (i) through (iii) are confirmed, then Test Pass. |
No Defenses (l): VCIβs and the Servicerβs FiServ electronic data warehouse containing records related to the Receivables do not reflect any right of rescission, set-off, counterclaim or defense, or of the same being asserted or threatened, in writing by any Obligor with respect to any Receivable.
Documents
(i) | System screenprint |
(i) | Review the system screenprint and confirm there is no evidence of litigation or other attorney involvement. |
(ii) | Review the system screenprint and confirm that there is no evidence that the Receivable is subject to recission, set-off, counterclaim or defense that would cause the Receivable to become invalid. |
If steps (i) and (ii) are confirmed, then Test Pass.
No Repossession (m): As of the Cut-Off Date, no Financed Vehicle shall have been repossessed.
Documents
(i) | System screenprint |
(i) | Review the system screenprint and confirm the Receivable was not held in repossession as of the Cut-Off Date. |
If step (i) is confirmed, then Test Pass.