EXHIBIT 4.3.1
FORM OF INDENTURE
CONSUMERS FUNDING LLC,
Issuer
and
THE BANK OF NEW YORK,
Trustee
---------------------
INDENTURE
Dated as of [_______] [__], 2001
---------------------
Securing Securitization Bonds
Issuable in Series
TABLE OF CONTENTS
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01 Definitions..................................................2
SECTION 1.02 Incorporation by Reference of the Trust Indenture Act........2
SECTION 1.03 Rules of Construction........................................3
ARTICLE II
The Securitization Bonds
SECTION 2.01 Form.........................................................3
SECTION 2.02 Execution, Authentication and Delivery.......................4
SECTION 2.03 Denominations; Securitization Bonds Issuable in Series.......4
SECTION 2.04 Temporary Securitization Bonds...............................5
SECTION 2.05 Registration; Registration of Transfer and Exchange..........6
SECTION 2.06 Mutilated, Destroyed, Lost or Stolen Securitization Bonds....7
SECTION 2.07 Persons Deemed Owner.........................................8
SECTION 2.08 Payment of Principal and Interest; Interest on Overdue
Principal; Principal and Interest Rights Preserved...........8
SECTION 2.09 Cancellation................................................10
SECTION 2.10 Amount; Authentication and Delivery of Securitization
Bonds.......................................................10
SECTION 2.11 Book-Entry Securitization Bonds.............................15
SECTION 2.12 Notices to Clearing Agency..................................16
SECTION 2.13 Definitive Securitization Bonds.............................16
ARTICLE III
Covenants
SECTION 3.01 Payment of Principal and Interest...........................17
SECTION 3.02 Maintenance of Office or Agency.............................18
SECTION 3.03 Money for Payments To Be Held in Trust......................18
SECTION 3.04 Existence...................................................20
SECTION 3.05 Protection of Collateral....................................20
SECTION 3.06 Opinions as to Collateral...................................20
SECTION 3.07 Performance of Obligations..................................21
SECTION 3.08 Negative Covenants..........................................21
SECTION 3.09 Annual Statement as to Compliance...........................22
SECTION 3.10 Issuer May Consolidate, etc., Only on Certain Terms.........22
SECTION 3.11 Successor or Transferee.....................................23
SECTION 3.12 No Other Business...........................................24
SECTION 3.13 No Borrowing................................................24
SECTION 3.14 Guarantees, Loans, Advances and Other Liabilities...........24
SECTION 3.15 Capital Expenditures........................................24
SECTION 3.16 Restricted Payments.........................................24
SECTION 3.17 Notice of Events of Default.................................25
SECTION 3.18 Inspection..................................................25
SECTION 3.19 Adjusted Overcollateralization Balance Schedules............25
SECTION 3.20 Sale Agreement, Servicing Agreement and Swap Agree
ment Covenants..............................................25
SECTION 3.21 Taxes.......................................................29
ARTICLE IV
Satisfaction and Discharge; Defeasance
SECTION 4.01 Satisfaction and Discharge of Indenture; Defeasance.........29
SECTION 4.02 Conditions to Defeasance....................................31
SECTION 4.03 Application of Trust Money..................................32
SECTION 4.04 Repayment of Moneys Held by Paying Agent....................32
ARTICLE V
Remedies
SECTION 5.01 Events of Default...........................................33
SECTION 5.02 Acceleration of Maturity; Rescission and Annulment..........34
SECTION 5.03 Collection of Indebtedness and Suits for Enforcement by
Trustee.....................................................35
SECTION 5.04 Remedies....................................................37
SECTION 5.05 Optional Preservation of the Collateral.....................38
SECTION 5.06 Limitation of Proceedings...................................38
SECTION 5.07 Unconditional Rights of Securitization Bondholders To
Receive Principal and Interest..............................39
SECTION 5.08 Restoration of Rights and Remedies..........................39
SECTION 5.09 Rights and Remedies Cumulative..............................40
SECTION 5.10 Delay or Omission Not a Waiver..............................40
SECTION 5.11 Control by Securitization Bondholders.......................40
SECTION 5.12 Waiver of Past Defaults.....................................41
SECTION 5.13 Undertaking for Costs.......................................41
SECTION 5.14 Waiver of Stay or Extension Laws............................42
SECTION 5.15 Action on Securitization Bonds..............................42
ARTICLE VI
The Trustee
SECTION 6.01 Duties and Liabilities of Trustee...........................42
SECTION 6.02 Rights of Trustee...........................................43
SECTION 6.03 Individual Rights of Trustee................................44
SECTION 6.04 Trustee's Disclaimer........................................44
SECTION 6.05 Notice of Defaults..........................................45
SECTION 6.06 Reports by Trustee to Holders...............................45
SECTION 6.07 Compensation and Indemnity..................................46
SECTION 6.08 Replacement of Trustee......................................46
SECTION 6.09 Successor Trustee by Merger.................................47
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee...............48
SECTION 6.11 Eligibility; Disqualification...............................49
SECTION 6.12 Preferential Collection of Claims Against Issuer............49
SECTION 6.13 Representations and Warranties of the Trustee...............49
ARTICLE VII
Securitization Bondholders' Lists and Reports
SECTION 7.01 Issuer To Furnish Trustee Names and Addresses of
Securitization Bondholders..................................50
SECTION 7.02 Preservation of Information; Communications to
Securitization Bondholders..................................50
SECTION 7.03 Reports by Issuer...........................................50
SECTION 7.04 Reports by Trustee..........................................51
SECTION 7.05 Provision of Servicer Reports...............................51
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.01 Collection of Money.........................................52
SECTION 8.02 Collection Account..........................................52
SECTION 8.03 Release of Collateral.......................................58
SECTION 8.04 Issuer Opinion of Counsel...................................58
SECTION 8.05 Reports by Independent Accountants..........................58
ARTICLE IX
Supplemental Indentures
SECTION 9.01 Supplemental Indentures Without Consent of Securitiza
tion Bondholders............................................59
SECTION 9.02 Supplemental Indentures with Consent of Securitization
Bondholders.................................................61
SECTION 9.03 Execution of Supplemental Indentures........................62
SECTION 9.04 Effect of Supplemental Indenture............................63
SECTION 9.05 Conformity with Trust Indenture Act.........................63
SECTION 9.06 Reference in Securitization Bonds to Supplemental
Indentures..................................................63
ARTICLE X
Redemption of Securitization Bonds
SECTION 10.01 Optional Redemption by Issuer...............................63
SECTION 10.02 Mandatory Redemption by Issuer..............................64
SECTION 10.03 Form of Redemption Notice...................................64
SECTION 10.04 Payment of Redemption Price.................................65
ARTICLE XI
Miscellaneous
SECTION 11.01 Compliance Certificates and Opinions, etc...................65
SECTION 11.02 Form of Documents Delivered to Trustee......................66
SECTION 11.03 Acts of Securitization Bondholders..........................67
SECTION 11.04 Notices, etc., to Trustee, Issuer and Rating Agencies.......67
SECTION 11.05 Notices to Securitization Bondholders; Waiver...............68
SECTION 11.06 Notices to Luxembourg Stock Exchange........................69
SECTION 11.07 Alternate Payment and Notice Provisions.....................69
SECTION 11.08 Conflict with Trust Indenture Act...........................69
SECTION 11.09 Effect of Headings and Table of Contents....................70
SECTION 11.10 Successors and Assigns......................................70
SECTION 11.11 Severability................................................70
SECTION 11.12 Benefits of Indenture.......................................70
SECTION 11.13 Legal Holidays..............................................70
SECTION 11.14 Governing Law...............................................70
SECTION 11.15 Counterparts................................................70
SECTION 11.16 Issuer Obligation...........................................70
SECTION 11.17 No Petition.................................................71
APPENDIX A MASTER DEFINITIONS
INDENTURE, dated as of [_______] [__], 2001, by and between
CONSUMERS FUNDING LLC, a Delaware limited liability company, as Issuer, and
THE BANK OF NEW YORK, a New York banking corporation in its capacity as
trustee for the benefit of the Holders of the Securitization Bonds and as
agent for itself and any Swap Counterparty (collectively, the "Trustee").
The Issuer has duly authorized the execution and delivery of this
Indenture to provide for one or more Series of Securitization Bonds,
issuable as provided in this Indenture. Each such Series of Securitization
Bonds will be issued only under a separate Series Supplement to this
Indenture duly executed and delivered by the Issuer and the Trustee. The
Issuer is entering into this Indenture, and the Trustee is accepting the
trusts created hereby, each for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged and each intending
to be legally bound hereby.
GRANTING CLAUSE
The Issuer hereby Grants to the Trustee as trustee for the benefit
of (i) the Holders of the Securitization Bonds from time to time issued and
outstanding, (ii) the Trustee and (iii) any Swap Counterparty, all of the
Issuer's right, title and interest whether now owned or hereafter acquired,
in, to and under: (a) all Securitization Property, including, without
limitation, the Securitization Property transferred by the Seller to the
Issuer from time to time pursuant to the Sale Agreement and all proceeds
thereof, (b) the Sale Agreement, (c) all Bills of Sale delivered by the
Seller pursuant to the Sale Agreement, (d) the Servicing Agreement, (e) the
Administra tion Agreement, (f) any Interest Rate Swap Agreement; (g) the
Intercreditor Agreement, (h) the Collection Account and all sub-accounts
thereof (other than the Capital Reserve Subaccount) (including, without
limitation, the General Subaccount, each Series Overcollateralization
Subaccount, each Series Capital Subaccount, the Reserve Subaccount, each
Series Subaccount, any Class Subaccount and any Defeasance Subaccount) and
all cash, securities, instruments, investment property or other assets
deposited in or credited to the Collection Account or any subaccount
thereof from time to time or purchased with funds therefrom, (i) all
investment property and all other property of whatever kind owned from time
to time by the Issuer, including rights under any interest rate swap or cap
agreement, other than: (w) any cash released to any Swap Counterparty by
the Trustee from the related Class Subaccount pursuant to Section 8.02(f)
and any interest rate swap or cap agreement, (x) any cash or other property
released to the Issuer by the Trustee from any Series Capital Subaccount
pursuant to Section 8.02(g)(x) and (y) the proceeds from the sale of the
Securitization Bonds used to pay (1) the costs of issuance of the
Securitization Bonds and all other up-front qualified costs permitted by
the Financing Order and (2) the purchase price of the Securitization
Property pursuant to the Sale Agreement, (j) all present and future claims,
demands, causes and choses in action in respect of any or all of the
foregoing and (k) all payments on or under and all proceeds of every kind
and nature whatsoever in respect of any or all of the foregoing, including
all proceeds of the conversion, voluntary or involuntary, into cash or
other liquid property, all cash proceeds, accounts, accounts receivable,
general intangibles, notes, drafts, acceptances, chattel paper, checks,
deposit accounts, insurance proceeds, condemnation awards, rights to
payment of any and every kind and other forms of obligations and
receivables, instruments and other property which at any time constitute
all or part of or are included in the proceeds of any of the foregoing
(collectively, the "Collateral").
Such Grants are made to the Trustee to have and to hold in trust
to secure the payment of principal of, and interest on, and any other
amounts owing in respect of, the Securiti zation Bonds and all fees,
expenses, counsel fees and other amounts due and owing to the Trustee and,
if and to the extent provided in any Series Supplement, any amounts due and
owing to any Swap Counterparty (collectively, the "Secured Obligations"),
equally and ratably without prejudice, preference, priority or distinction,
except as expressly provided in this Indenture and to secure performance by
the Issuer of all of the Issuer's obligations under this Indenture with
respect to the Securitization Bonds, all as provided in this Indenture.
The Trustee, as trustee on behalf of the Holders of the
Securitization Bonds, acknowledges such Grant, accepts the trusts hereunder
in accordance with the provisions hereof and agrees to perform its duties
herein required.
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01 Definitions. Capitalized terms used but not otherwise
defined in this Indenture have the respective meanings set forth in
Appendix A hereto unless the context otherwise requires.
SECTION 1.02 Incorporation by Reference of the Trust Indenture
Act. Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this
Indenture. Each of the following TIA terms used in this Indenture has the
following meaning:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Securitization Bonds.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule
have the meaning assigned to them by such definitions.
SECTION 1.03 Rules of Construction.
(a) An accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles
as in effect from time to time;
(b) "including" means including without limitation;
(c) with respect to terms defined in Appendix A hereto, words in
the singular include the plural and words in the plural include the
singular;
(d) unless otherwise specified, references herein to Sections or
Articles are to Sections or Articles of this Indenture; and
(e) the words "herein", "hereof", "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
ARTICLE II
The Securitization Bonds
SECTION 2.01 Form. (a) The Securitization Bonds and the Trustee's
certifi cate of authentication shall be in substantially the forms set
forth in Exhibit A to the related Series Supplement, with such appropriate
insertions, omissions, substitutions and other varia tions as are required
or permitted by this Indenture or by the related Series Supplement and may
have such letters, numbers or other marks of identification and such
legends or endorsements placed thereon as may, consistently herewith, be
determined by the Managers of the Issuer executing such Securitization
Bonds, as evidenced by their execution of such Securitization Bonds. Any
portion of the text of any Securitization Bond may be set forth on the
reverse thereof, with an appropriate reference thereto on the face of the
Securitization Bond. Each Securitization Bond shall be dated the date of
its authentication.
(b) The Securitization Bonds shall be typewritten, printed,
lithographed or engraved or produced by any combination of these methods
(with or without steel engraved borders), all as determined by the Managers
of the Issuer executing such Securitization Bonds, as evidenced by their
execution of such Securitization Bonds.
(c) Each Securitization Bond shall bear upon its face the
designation so selected for the Series and Class, if any, to which it
belongs. The terms of all Securitization Bonds of the same Series shall be
the same, unless such Series is comprised of one or more Classes, in which
case the terms of all Securitization Bonds of the same Class shall be the
same.
(d) Each Securitization Bond shall state that under the Customer
Choice Act the State of Michigan pledges, for the benefit and protection of
the Holders of the Securitization Bonds, other persons acting for the
benefit of a Holder and Consumers, that it will not take or permit any
action that would impair the value of the Securitization Property, reduce
or alter, except as allowed under section 10k(3) of the Customer Choice Act
with respect to periodic adjustments of the Securitization Charges, or
impair the Securitization Charges to be imposed, collected, and remitted to
the Trustee, until the principal, interest and premium, and any other
charges incurred and contracts to be performed in connection with the
Securitization Bonds have been paid and performed in full. The Issuer is
authorized to include this pledge in any documen tation relating to the
Securitization Bonds.
SECTION 2.02 Execution, Authentication and Delivery. (a) The
Securitiza tion Bonds shall be executed on behalf of the Issuer by a
Manager. The signature of any such Manager on the Securitization Bonds may
be manual or facsimile.
(b) Securitization Bonds bearing the manual or facsimile signature
of individuals who were at any time Managers shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold
such offices prior to the authentication and delivery of such
Securitization Bonds.
(c) At any time and from time to time after the execution and
delivery of this Indenture, the Issuer may deliver Securitization Bonds
executed on behalf of the Issuer to the Trustee pursuant to an Issuer Order
for authentication; and the Trustee shall authenticate and deliver such
Securitization Bond as in this Indenture provided and not otherwise.
(d) No Securitization Bond shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose, unless there
appears on such Securitization Bond a certificate of authentication
substantially in the form provided for herein executed by the Trustee by
the manual signature of one of its authorized signatories, and such
certificate upon any Securitization Bond shall be conclusive evidence, and
the only evidence, that such Securitization Bond has been duly
authenticated and delivered hereunder.
(e) To the extent any of the Securitization Bonds are listed on
the Luxem xxxxx Stock Exchange and the rules and regulations of such
exchange so require, a transfer or other agent appointed pursuant to
Section 3.02(b) shall be authorized on behalf of the Trustee to execute and
deliver such certificate of authentication.
SECTION 2.03 Denominations; Securitization Bonds Issuable in
Series. (a) The Securitization Bonds of each Series shall be issuable as
registered Securitization Bonds in the Authorized Denominations specified
in the Series Supplement therefor.
(b) The Securitization Bonds may, at the election of and as
authorized by a Manager and set forth in a Series Supplement, be issued in
one or more Series (each of which may be comprised of one or more Classes),
and shall be designated generally as the "Securitiza tion Bonds" of the
Issuer, with such further particular designations added or incorporated in
such title for the Securitization Bonds of any particular Series or Class
as a Manager of the Issuer may determine and be set forth in the Series
Supplement therefor.
(c) Each Series of Securitization Bonds shall be created by a
Series Supple ment authorized by a Manager and establishing the terms and
provisions of such Series and, if applicable, any Classes thereof. The
several Series and any Classes thereof may differ as between Series and
Classes, in respect of any of the following matters:
(i) designation of the Series and each Class thereof;
(ii) the aggregate initial principal amount of the
Securitization Bonds of the Series and each Class thereof;
(iii) the Interest Rate of the Series and each Class
thereof or the formula, if any, used to calculate the applicable
Interest Rate or Interest Rates for the Series and each Class
thereof;
(iv) the Payment Dates of the Series and each Class
thereof;
(v) the Expected Final Payment Date of the Series and
each Class thereof;
(vi) the Final Maturity Date of the Series and each Class
thereof;
(vii) the Series Issuance Date of the Series;
(viii) the place or places for payments with respect to
the Series and each Class thereof;
(ix) the Authorized Denominations for the Series and each
Class thereof;
(x) the provisions, if any, for redemption by the Issuer
of the Series and each Class thereof;
(xi) the Expected Amortization Schedule for the Series
and each Class thereof;
(xii) the Overcollateralization Amount with respect to
the Series;
(xiii) the Required Capital Amount with respect to the
Series;
(xiv) the Calculation Dates and Adjustment Dates for the
Series;
(xv) the credit enhancement, if any, applicable to the
Series and each Class thereof; and
(xvi) any other terms of the Series or each Class that
are not inconsistent with the provisions of this Indenture.
SECTION 2.04 Temporary Securitization Bonds. (a) Pending the
preparation of definitive Securitization Bonds pursuant to Section 2.13 or
in the case of Securitization Bonds held in a book-entry only system by a
Clearing Agency, a Manager on behalf of the Issuer may execute, and upon
receipt of an Issuer Order the Trustee shall authenticate and deliver,
temporary Securitization Bonds which are printed, lithographed,
typewritten, mimeographed or otherwise produced, of the tenor of the
definitive Securitization Bonds in lieu of which they are issued and with
such variations not inconsistent with the terms of this Indenture as the
Manager executing such Securitization Bonds may determine, as evidenced by
their execution of such Securitization Bonds.
(b) If temporary Securitization Bonds are issued, the Issuer will
cause definitive Securitization Bonds to be prepared without unreasonable
delay except where temporary Securitization Bonds are held by a Clearing
Agency. After the preparation of definitive Securitization Bonds, the
temporary Securitization Bonds shall be exchangeable for definitive
Securitization Bonds upon surrender of the temporary Securitization Bonds
at the office or agency of the Issuer to be maintained as provided in
Section 3.02, without charge to any Holder. Upon surrender for cancellation
of any one or more temporary Securitization Bonds, a Manager on behalf of
the Issuer shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like Series (and if applicable, Class) and aggregate
initial principal amount of definitive Securitization Bonds in Authorized
Denominations. Until so exchanged, the temporary Securitization Bonds shall
in all respects be entitled to the same benefits under this Indenture as
definitive Securitization Bonds.
SECTION 2.05 Registration; Registration of Transfer and Exchange.
(a) The Issuer shall cause to be kept a register (the "Securitization Bond
Register") in which, subject to such reasonable regulations as it may
prescribe, the Issuer shall provide for the registration of Securitization
Bonds and the registration of transfers of Securitization Bonds. The
Trustee shall be the registrar (the Trustee or any successor thereof in
such capacity, the "Securitization Bond Registrar") for the purpose of
registering Securitization Bonds and transfers of Securitization Bonds as
herein provided. Upon any resignation of any Securitization Bond Registrar,
the Issuer shall promptly appoint a successor or, if it elects not to make
such an appointment, assume the duties of Securitization Bond Registrar.
(b) If a Person other than the Trustee is appointed by the Issuer
as Securitiza tion Bond Registrar, the Issuer shall give the Trustee and
any transfer, paying or listing agent of the Issuer appointed pursuant to
Section 3.02(b) prompt written notice of the appointment of such
Securitization Bond Registrar and of the location, and any change in the
location, of the Securitization Bond Register; the Trustee and any such
agent shall have the right to inspect the Securitization Bond Register at
all reasonable times and to obtain copies thereof; and the Trustee and any
such agent shall have the right to rely upon a certificate executed on
behalf of the Securitization Bond Registrar by a duly authorized officer
thereof as to the names and addresses of the Holders of the Securitization
Bonds and the original and Outstanding principal amounts and number of such
Securitization Bonds (separately stated by Series and, if applicable,
Class).
(c) Upon surrender for registration of transfer of any
Securitization Bond at the office or agency of the Issuer to be maintained
as provided in Section 3.02, a Manager on behalf of the Issuer shall
execute, and the Trustee shall authenticate and the Securitization
Bondholder shall obtain from the Trustee, in the name of the designated
transferee or transferees, one or more new Securitization Bonds in any
Authorized Denominations, of a like Series (and, if applicable, Class) and
aggregate initial principal amount.
(d) At the option of the Holder, Securitization Bonds may be
exchanged for other Securitization Bonds of a like Series (and, if
applicable, Class) and aggregate initial principal amount in Authorized
Denominations, upon surrender of the Securitization Bonds to be exchanged
at such office or agency as provided in Section 3.02. Whenever any
Securitization Bonds are so surrendered for exchange, a Manager on behalf
of the Issuer shall execute, and the Trustee shall authenticate and the
Securitization Bondholder shall obtain from the Trustee, the Securitization
Bonds which the Securitization Bondholder making the exchange is entitled
to receive.
(e) All Securitization Bonds issued upon any registration of
transfer or exchange of Securitization Bonds shall be the valid obligations
of the Issuer, evidencing the same debt, and entitled to the same benefits
under this Indenture, as the Securitization Bonds surren dered upon such
registration of transfer or exchange.
(f) Every Securitization Bond presented or surrendered for
registration of transfer or exchange shall be duly endorsed by, or be
accompanied by a written instrument of transfer in such form as is
satisfactory to the Trustee duly executed by, the Holder thereof or such
Holder's attorney duly authorized in writing, with such signature
guaranteed by an Eligible Guarantor Institution in the form set forth in
such Securitization Bond.
(g) No service charge shall be made to a Holder for any
registration of transfer or exchange of Securitization Bonds (except as may
be required by the rules and regulations of the Luxembourg Stock Exchange
with respect to any Securitization Bonds listed thereon), but, other than
in respect of exchanges pursuant to Sections 2.04 or 9.06 not involving any
transfer, the Issuer may require payment by such Holder of a sum sufficient
to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securitization
Bonds, including the fees and expenses of the Trustee.
(h) The preceding provisions of this Section 2.05 notwithstanding,
except to the extent otherwise required by the rules and regulations of the
Luxembourg Stock Exchange with respect to any Securitization Bonds listed
thereon, the Issuer shall not be required to make, and the Securitization
Bond Registrar need not register, transfers or exchanges of Securitization
Bonds selected for redemption or transfers or exchanges of any
Securitization Bond for a period of fifteen (15) days preceding the date on
which final payment of principal is to be made with respect to such
Securitization Bond.
SECTION 2.06 Mutilated, Destroyed, Lost or Stolen Securitization
Bonds. (a) If (i) any mutilated Securitization Bond is surrendered to the
Trustee, or the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Securitization Bond, and (ii) there is
delivered to the Trustee such security or indemnity as may be required by
it to hold the Issuer and the Trustee harmless, then, in the absence of
notice to the Issuer, the Securitization Bond Registrar or the Trustee that
such Securitization Bond has been acquired by a protected purchaser, a
Manager on behalf of the Issuer shall execute, and upon a Manager's request
the Trustee shall authenticate and deliver, in exchange for or in lieu of
any such mutilated, destroyed, lost or stolen Securitization Bond, a
replacement Securitization Bond of like Series (and, if applicable, Class),
tenor and initial principal amount in an Authorized Denomination, bearing a
number not contemporaneously outstanding; provided, however, that if any
such destroyed, lost or stolen Securitization Bond, but not a mutilated
Securitization Bond, shall have become or within seven days shall be due
and payable, or shall have been called for redemption, instead of issuing a
replacement Securitization Bond, the Issuer may pay such destroyed, lost or
stolen Securitization Bond when so due or payable or upon the Redemption
Date without surrender thereof. Upon issuance of any substituted
Securitization Bond, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other related expenses. If, after the
delivery of such replacement Securitization Bond or payment of a destroyed,
lost or stolen Securitization Bond pursuant to the proviso to the preceding
sentence, a protected purchaser of the original Securitization Bond in lieu
of which such replacement Securitization Bond was issued presents for
payment such original Securitization Bond, the Issuer and the Trustee shall
be entitled to recover such replacement Securitization Bond (or such
payment) from the Person to whom it was delivered or any Person taking such
replacement Securitization Bond from such Person to whom such replacement
Securitization Bond was delivered or any assignee of such Person, except a
protected purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or
expense incurred by the Issuer or the Trustee in connection therewith.
(b) Every replacement Securitization Bond issued pursuant to this
Section 2.06 in replacement of any mutilated, destroyed, lost or stolen
Securitization Bond shall constitute an original additional contractual
obligation of the Issuer, whether or not the mutilated, destroyed, lost or
stolen Securitization Bond shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securitization Bonds duly issued
hereunder.
(c) The provisions of this Section 2.06 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect
to the replacement or payment of mutilated, destroyed, lost or stolen
Securitization Bonds.
SECTION 2.07 Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Securitization Bond, the Issuer, the
Trustee and any agent of the Issuer or the Trustee may treat the Person in
whose name any Securitization Bond is registered (as of the day of
determination) as the owner of such Securitization Bond for the purpose of
receiving payments of principal of and interest on such Securitization Bond
and for all other purposes whatsoever, whether or not such Securitization
Bond be overdue, and neither the Issuer, the Trustee nor any agent of the
Issuer or the Trustee shall be affected by notice to the contrary.
SECTION 2.08 Payment of Principal and Interest; Interest on
Overdue Principal; Principal and Interest Rights Preserved. (a) The
Securitization Bonds shall accrue interest as provided in the form of
Securitization Bond attached to the Series Supplement for such
Securitization Bonds, at the applicable Interest Rate specified therein,
and such interest shall be payable on each Payment Date as specified
therein. Any instalment of interest or principal payable on any
Securitization Bond which is punctually paid or duly provided for by the
Issuer on the applicable Payment Date shall be paid to the Person in whose
name such Securitization Bond (or one or more Predecessor Securitization
Bonds) is registered on the Record Date for such Payment Date, in the
manner specified in the related Series Supplement, and if not specified
therein, either (i) by check mailed first-class, postage prepaid to such
Person's address as it appears on the Securitization Bond Register on such
Record Date or (ii) with respect to Securiti zation Bonds registered on a
Record Date in the name of the nominee of the Clearing Agency (initially,
such nominee to be Cede & Co.), payments will be made by wire transfer in
immedi ately available funds to the account designated by such nominee,
except for the final instalment of principal payable with respect to such
Securitization Bond on a Payment Date, which shall be payable as provided
in clause (b) below. The funds represented by any such checks or other
amounts returned undelivered shall be held in accordance with Section 3.03.
(b) The principal of each Securitization Bond of each Series (and,
if applica ble, Class) shall be payable in instalments on each Payment Date
specified in the Expected Amortization Schedule included in the form of
Securitization Bond attached to the Series Supplement for such
Securitization Bonds, but only to the extent that moneys are available for
such payment pursuant to Section 8.02. Failure to pay in accordance with
such Expected Amortization Schedule because moneys are not so available
pursuant to Section 8.02 to make such payments shall not constitute a
Default or Event of Default under this Indenture. Notwith standing the
foregoing, the entire Outstanding principal amount of the Securitization
Bonds of any Series or Class shall be due and payable, if not previously
paid, either: (i) on the Final Maturity Date therefor, (ii) on the date on
which the Securitization Bonds of all Series have been declared immediately
due and payable in accordance with Section 5.02 or (iii) on the Redemp tion
Date, if any, therefor. The Trustee shall notify the Person in whose name a
Securitization Bond is registered, and any other Person required under the
relevant Series Supplement, at the close of business on the Record Date
preceding the Payment Date on which the Issuer expects that the final
instalment of principal of and interest on such Securitization Bond will be
paid. Such notice shall be mailed no later than ten (10) days prior to such
final Payment Date and shall specify that such final instalment of
principal will be payable only upon presentation and surrender of such
Securitization Bond and shall specify the place where such Securitization
Bond may be presented and surrendered for payment of such instalment,
which, so long as any Securitization Bonds are listed on the Luxembourg
Stock Exchange, shall include the office of the paying agent in Luxembourg
appointed pursuant to Section 3.02(b). The Trustee shall also arrange for
such notice to be published in an Authorized Newspaper, not later than the
fifth day of the month of the expected payment of such final instalment.
Notices in connection with redemptions of Securitization Bonds also shall
be mailed to Securitization Bondholders as provided in Section 10.03.
(c) If the Issuer defaults in a payment of interest on the
Securitization Bonds of any Series, or in a default of any amount payable
to any Swap Counterparty, the Issuer shall pay defaulted interest, plus
interest on such defaulted interest at the applicable Interest Rate in any
lawful manner (subject to the availability of such amounts in the related
Class Subaccount, in the case of interest owed with respect to any
Securitization Bonds which have a floating rate of interest). The Issuer
may pay such defaulted interest to the Persons who are Securitization
Bondholders and to any Swap Counterparty, as applicable, at the rate
specified in the related Series Supplement or Interest Rate Swap Agreement,
respectively, on a subsequent special record date, which date shall be at
least five Business Days prior to the payment date. The Issuer shall fix or
cause to be fixed any such special record date and payment date, and, at
least fifteen (15) days before any such special record date, the Issuer
shall mail to each affected Securitization Bondholder a notice that states
the special record date, the payment date and the amount of defaulted
interest to be paid.
SECTION 2.09 Cancellation. All Securitization Bonds surrendered
for payment, registration of transfer, exchange or redemption shall, if
surrendered to any Person other than the Trustee, be delivered to the
Trustee and shall be promptly canceled by the Trustee. The Issuer may at
any time deliver to the Trustee for cancellation any Securitization Bonds
previously authenticated and delivered hereunder which the Issuer may have
acquired in any manner whatsoever, and all Securitization Bonds so
delivered shall be promptly canceled by the Trustee. No Securitization
Bonds shall be authenticated in lieu of or in exchange for any
Securitization Bonds canceled as provided in this Section 2.09, except as
expressly permitted by this Indenture. All canceled Securitization Bonds
may be held or disposed of by the Trustee in accordance with its standard
retention or disposal policy as in effect at the time unless the Issuer
shall direct by an Issuer Order that they be destroyed or returned to it;
provided that such Issuer Order is timely and the Securitization Bonds have
not been previously disposed of by the Trustee.
SECTION 2.10 Amount; Authentication and Delivery of Securitization
Bonds. (a) The aggregate principal amount of Securitization Bonds that may
be authenticated and delivered under this Indenture shall not exceed
$468,592,000 plus the amount of any Refunding Issuance. The Issuer may
issue Securitization Bonds of a new Series as a Financing Issuance or a
Refunding Issuance.
(b) Securitization Bonds of a new Series may from time to time be
executed by a Manager on behalf of the Issuer and delivered to the Trustee
for authentication and thereupon the same shall be authenticated and
delivered by the Trustee upon Issuer Request and upon delivery by the
Issuer, at the Issuer's expense, to the Trustee of the following:
(i) Trust Action. An Issuer Order authorizing and
directing the authentication and delivery of the Securitization
Bonds by the Trustee and specifying the principal amount of
Securitization Bonds to be authenticated.
(ii) Authorizing Certificate. A certified resolution of
the Managers authorizing the execution and delivery of the Series
Supplement for the Securitization Bonds applied for and the
execution, authentication and delivery of such Securitization
Bonds.
(iii) Series Supplement. A Series Supplement for the
Series of Securitization Bonds being issued, which shall set forth
the provisions and form of the Securitization Bonds of such Series
(and, if applicable, each Class thereof).
(iv) Certificates of the Issuer and the Seller.
(A) An Issuer Officer's Certificate
dated as of the Series Issuance Date, stating:
(1) that no Default has
occurred and is continuing under this Indenture
and that the issuance of the Securitization
Bonds being issued will not result in any
Default;
(2) that the Issuer has not
assigned any interest or participation in the
Collateral except for the Grant contained in
this Indenture; that the Issuer has the power
and authority to Grant the Collat eral to the
Trustee as security hereunder; and that the
Issuer, subject to the terms of this Indenture,
has Granted to the Trustee a perfected security
interest in all right, title and interest in, to
and under the Collateral free and clear of any
Lien, except the Lien of this Indenture;
(3) that the Issuer has
appointed the firm of independent certified
public accountants as contemplated in Section
8.05;
(4) that attached thereto are
duly executed, true and complete copies of the
Sale Agreement and the Servicing Agreement;
(5) that all Delaware UCC and
Michigan UCC financ ing statements with respect
to the Collateral which are required to be filed
by the terms of the Sale Agreement, the
Servicing Agreement or this Indenture will be
filed as required; and
(6) that all conditions
precedent provided in this Inden ture relating
to the authentication and delivery of the
Securitization Bonds have been complied with.
(B) An Officer's Certificate from the
Seller, dated as of the Series Issuance Date, to the
effect that, in the case of the Securitization Property
to be transferred to the Issuer on such date, immediately
prior to the conveyance thereof to the Issuer pursuant to
the Sale Agreement:
(1) the Seller was the sole
owner of such Securitization Property and such
ownership interest was perfected; such
Securitization Property will be validly
transferred and sold to the Issuer free and
clear of all Liens (other than Liens created by
the Issuer pursuant to this Indenture) and such
transfer will be perfected; the Seller has the
power and authority to own, sell and assign such
Securitization Property to the Issuer; the
Seller has duly authorized such sale and
assignment to the Issuer; and the Seller has its
principal office in the State of Michigan; and
(2) the attached copy of the
Financing Order creating such Securitization
Property is true and correct and is in full
force and effect; and
(v) Issuer Opinion of Counsel. An Issuer Opinion
of Counsel, portions of which may be delivered by counsel for the
Issuer and portions of which may be delivered by counsel for the
Seller and/or the Servicer, dated as of the Series Issuance Date,
subject to customary qualifications, to the collective effect,
subject to customary qualifications and exceptions that:
(A) the Issuer has the power and
authority to execute and deliver the Series Supplement
and this Indenture and to issue the Securitization Bonds
being issued, each of the Series Supplement and this
Indenture and such Securitization Bonds have been duly
authorized, executed and delivered, and the Issuer is
duly organized, is validly existing as a limited
liability company and in good standing under the laws of
the jurisdiction of its organization and is in good
standing in any jurisdiction where it is required to be
qualified;
(B) no authorization, approval or
consent of any governmental body is required for the
valid issuance, authentication or delivery of such
Securiti zation Bonds, except for any such authorization,
approval or consent as has already been obtained and such
registrations as are required under the Blue Sky and
securities laws of any State;
(C) the Securitization Bonds being
issued, when executed, and authenticated in accordance
with the provisions of this Indenture and delivered, will
constitute valid and binding obligations of the Issuer
entitled to the benefits of this Indenture and the
related Series Supplement;
(D) the Financing Order is final and
non-appealable;
(E) this Indenture (including the
related Series Supplement), the Sale Agreement and the
Servicing Agreement have been duly authorized, executed
and delivered by the Issuer and constitute the legal,
valid and binding agreements of the Issuer, enforceable
against the Issuer in accordance with their respective
terms except as such enforceability may be subject to
bankruptcy, insolvency, reorganization and other similar
laws affecting the rights of creditors generally and
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or
at law);
(F) the Sale Agreement has been duly
authorized, executed and delivered by the Seller and
constitutes the legal, valid and binding agreement of the
Seller, enforceable against the Seller in accordance with
its terms except as such enforceability may be subject to
bankruptcy, insolvency, reorganization and other similar
laws affecting the rights of creditors generally and
general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at
law);
(G) the Servicing Agreement has been
duly authorized, exe cuted and delivered by the Servicer
and constitutes the legal, valid and binding agreement of
the Servicer, enforceable against the Servicer in
accordance with its terms except as such enforceability
may be subject to bankruptcy, insolvency, reorganization
and other similar laws affecting the rights of creditors
generally and general principles of equity (regardless of
whether such enforcement is considered in a proceeding in
equity or at law);
(H)
(1) the provisions of the Sale
Agreement together with the Xxxx of Sale are
effective to create, in favor of the Issuer, a
valid security interest (as such term is defined
in the Michigan UCC) in the Seller's rights in
the Securitization Property described in the
Xxxx of Sale, which security interest if
characterized as a transfer for security will
secure the amount paid by the Issuer for such
Transferred Securitization Property; it being
noted that the term "security interest" includes
both a sale and a transfer for security of an
account and no opinion is expressed as to the
proper characterization of the transfer of the
Transferred Securitization Property by the
Seller to the Issuer;
(2) the security interest in
favor of the Issuer in the Transferred
Securitization Property has been perfected; and
(3) we hereby confirm that the
UCC search reports for the Issuer and for
Consumers identifies no person as having filed
in the Filing Office a financing statement
naming either Consumers Energy Company or
Consumers Funding LLC as debtor and containing a
descrip tion of collateral sufficient to include
the Collateral as of the effective date of the
Search Report; and
(I)
(1) this Indenture creates in
favor of the Trustee, to secure payment of the
Secured Obligations, a valid security interest
in the rights of the Issuer in, to and under
that portion of the Collateral subject to
Article 8 or Article 9 of the Michigan UCC,
including the Securitization Property,
(2) upon filing of the related
financing statements in accordance with the
Michigan UCC and the Delaware UCC, such security
interest will be perfected, and
(3) we hereby confirm that the
UCC search reports for the Issuer and for
Consumers identifies no person as having filed
in the Filing Office a financing statement
naming either Consumers Energy Company or
Consumers Funding LLC as debtor and containing a
descrip tion of collateral sufficient to include
the Collateral as of the effective date of the
Search Report;
(J) this Indenture has been duly
qualified under the Trust Indenture Act and either the
Series Supplement for the Securitization Bonds applied
for has been duly qualified under the Trust Indenture Act
or no such qualification of such Series Supplement is
necessary;
(K) all instruments furnished to the
Trustee conform to the requirements of this Indenture and
constitute all of the documents required to be delivered
hereunder for the Trustee to authenticate and deliver the
Securitization Bonds applied for, and all conditions
precedent provided for in this Indenture relating to the
issuance, authentication and delivery of the
Securitization Bonds have been complied with;
(L) either
(1) the registration statement
covering the Securitiza tion Bonds is effective
under the Securities Act of 1933 and, to the
best of such counsel's knowledge and
information, no stop order suspending the
effectiveness of such registration statement has
been issued under the Securities Act of 1933 nor
have proceedings therefor been instituted or
threatened by the Commission or
(2) the Securitization Bonds
are exempt from the registration requirements
under the Securities Act of 1933; and
(M) the Issuer is not now and,
following the issuance of the Securitization Bonds will
not be, required to be registered under the Investment
Company Act of 1940, as amended.
(vi) Accountant's Certificate or Opinion. A
letter addressed to the Issuer and the Trustee complying with the
requirements of Section 11.01, of a firm of Independent certified
public accountants of recognized national reputation to the effect
that (A) such accountants are Independent with respect to the
Issuer within the meaning of this Indenture, and are independent
public accountants within the meaning of the standards of The
American Institute of Certified Public Accountants, and (B) with
respect to the Collateral, they have made certain specified
recalculations of calculations and information provided by the
Issuer for the purpose of determining that, based on certain
specified assumptions used in calculating the Securitization
Charge with respect to the related Transferred Securitization
Property, as of the Series Issuance Date for such Series, the
Securitization Charge will be sufficient to pay as of each Payment
Date taking into account any amounts on deposit in the reserve
subaccount:
(1) assumed Operating Expenses when incurred, plus
(2) any amounts due under any Interest Rate Swap
Agreement when due, plus
(3) the Overcollateralization Amount for such Series set
forth in the Prospectus (as such term is defined in the
Underwriting Agreement), plus
(4) interest on the Securitization Bonds at their
respective Interest Rates when due as set forth in the
Final Prospectus, plus
(5) principal of the Securitization Bonds in accordance
with the Expected Amortization Schedule set forth in the
Final Prospectus,
and found such calculations to be mathematically correct.
(vii) Required Capital Amount. Evidence
satisfactory to the Trustee that the Required Capital Amount for
such Series has been credited to the Capital Subaccount for such
Series, provided that in the case of the initial Series of
Securitization Bonds, $100,000 of the Required Capital Amount for
such Series shall have been deposited to the credit of the Capital
Reserve Subaccount.
(viii) Rating Agency Condition. Written notice
from each Rating Agency that such action will not result in a
reduction or withdrawal of the then current rating by such Rating
Agency of any Outstanding Series or Class of Securitization Bonds.
(ix) Xxxx of Sale. If the issuance of an
additional Series of Securitiza tion Bonds is a Financing
Issuance, the Xxxx of Sale delivered to the Issuer under the Sale
Agreement with respect to the Securitization Property being
purchased with the proceeds of such Financing Issuance.
(x) Moneys for Refunding. If the issuance of a
Series of Securitization Bonds is a Refunding Issuance, the amount
of money necessary to pay the outstanding principal balance of and
interest on the Securitization Bonds being refunded to the
Redemption Date for the Securitization Bonds being refunded upon
redemption, such money to be deposited into a separate account
with the Trustee.
SECTION 2.11 Book-Entry Securitization Bonds. Unless otherwise
specified in the related Series Supplement, each Series of Securitization
Bonds, upon original issuance, will be issued in the form of a typewritten
Securitization Bond or Securitization Bonds represent ing the Book-Entry
Securitization Bonds, to be delivered to The Depository Trust Company, the
initial Clearing Agency, by, or on behalf of, the Issuer. Such
Securitization Bond shall initially be registered on the Securitization
Bond Register in the name of Cede & Co., the nominee of the initial
Clearing Agency, and no Securitization Bond Owner will receive a definitive
Securitiza tion Bond representing such Securitization Bond Owner's interest
in such Securitization Bond, except as provided in Section 2.13. Unless and
until definitive, fully registered Securitization Bonds (the "Definitive
Securitization Bonds") have been issued to Securitization Bondholders
pursuant to Section 2.13:
(a) the provisions of this Section 2.11 shall be in full
force and effect;
(b) the Securitization Bond Registrar and the Trustee
shall be entitled to deal with the Clearing Agency for all purposes of this
Indenture (including the payment of principal of and interest on the
Securitization Bonds and the giving of instructions or directions
hereunder) as the sole Holder of the Securitization Bonds, and shall have
no obligation to the Securitization Bond Owners;
(c) to the extent that the provisions of this Section
2.11 conflict with any other provisions of this Indenture, the provisions
of this Section shall control;
(d) the rights of Securitization Bond Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Securitization Bond Owners
and the Clearing Agency or the Clearing Agency Participants. Pursuant to
the DTC Agreement, unless and until Definitive Securitization Bonds are
issued pursuant to Section 2.13, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive and
transmit payments of principal of and interest on the Securitization Bonds
to such Clearing Agency Participants; and
(e) whenever this Indenture requires or permits actions
to be taken based upon instructions or directions of Holders of
Securitization Bonds evidencing a specified percentage of the Outstanding
Amount of the Securitization Bonds or a Series or Class thereof, the
Clearing Agency shall be deemed to represent such percentage only to the
extent that it has received instructions to such effect from Securitization
Bond Owners or Clearing Agency Participants owning or representing,
respectively, such required percentage of the beneficial interest in the
Securitization Bonds or such Series or Class and has delivered such
instructions to the Trustee.
SECTION 2.12 Notices to Clearing Agency. Whenever a
notice or other communication to the Securitization Bondholders is required
under this Indenture, unless and until Definitive Securitization Bonds
shall have been issued to Securitization Bond Owners pursuant to Section
2.13, the Trustee shall give all such notices and communications specified
herein to be given to Securitization Bondholders to the Clearing Agency,
and shall have no obligation to the Securitization Bond Owners.
SECTION 2.13 Definitive Securitization Bonds. (a) If (i) the
Issuer advises the Trustee in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities as depository
with respect to any Series or Class of Securitization Bonds and the Issuer
is unable to locate a qualified successor, (ii) the Issuer, at its option,
advises the Trustee in writing that it elects to terminate the book-entry
system through the Clearing Agency with respect to any Series or Class of
Securitization Bonds or (iii) after the occurrence of an Event of Default,
Securitization Bond Owners representing beneficial interests aggregating at
least a majority of the Outstanding Amount of the Securitization Bonds of
all Series advise the Trustee through the Clearing Agency in writing that
the continuation of a book-entry system through the Clearing Agency is no
longer in the best interests of the Securitization Bond Owners, then the
Clearing Agency shall notify all affected Securitization Bond Owners and
the Trustee of the occurrence of any such event and of the availability of
Definitive Securitization Bonds to affected Securitization Bond Owners
requesting the same. Upon surrender to the Trustee of the typewritten
Securitization Bond or Securitization Bonds representing the Book-Entry
Securitiza tion Bonds by the Clearing Agency, accompanied by registration
instructions, a Manager on behalf of the Issuer shall execute and the
Trustee shall authenticate the Definitive Securitization Bonds upon receipt
of an Issuer Order registered in such names and in such denominations in
accordance with the instructions of the Clearing Agency. None of the
Issuer, the Securitization Bond Registrar or the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely
on, and shall be protected in relying on, such instructions. Any Definitive
Securitization Bonds listed on the Luxembourg Stock Exchange shall be made
available to the Securitization Bond Owners through the office of the
transfer agent appointed pursuant to Section 3.02(b). Upon the issuance of
Definitive Securitization Bonds, the Trustee shall recognize the Holders of
the Definitive Securitization Bonds as Securitization Bondholders.
(b) Definitive Securitization Bonds will be transferable and
exchangeable at the offices of the Securitization Bond Registrar or, with
respect to any Securitization Bonds listed on the Luxembourg Stock
Exchange, at the offices of the transfer agent appointed pursuant to
Section 3.02(b). With respect to any transfer of such listed Securitization
Bonds, the new Definitive Securitization Bonds registered in the names
specified by the transferee and the original transferor shall be available
at the offices of such transfer agent.
ARTICLE III
Covenants
SECTION 3.01 Payment of Principal and Interest. The Issuer will
duly and punctually pay the principal of and interest on the Securitization
Bonds in accordance with the terms of the Securitization Bonds and this
Indenture; provided that except on the Final Maturity Date or the
Redemption Date for a Series or Class of Securitization Bonds or upon the
accelera tion of the Securitization Bonds pursuant to Section 5.02, the
Issuer shall only be obligated to pay the principal of such Securitization
Bonds on each Payment Date therefor to the extent moneys are available for
such payment pursuant to Section 8.02. Amounts properly withheld under the
Code by any Person from a payment to any Securitization Bondholder of
interest or principal shall be considered as having been paid by the Issuer
to such Securitization Bondholder for all purposes of this Indenture.
SECTION 3.02 Maintenance of Office or Agency. (a) The Issuer will
maintain in the Borough of Manhattan, the City of New York, an office or
agency where Securitization Bonds may be surrendered for registration of
transfer or exchange, and where notices and demands to or upon the Issuer
in respect of the Securitization Bonds and this Indenture may be served.
The Issuer hereby initially appoints the Trustee to serve as its agent for
the foregoing purposes. The Issuer will give prompt written notice to the
Trustee and any agent appointed pursuant to clause (b) below of the
location and identity, and of any change in the location or identity, of
any such office or agency. If at any time the Issuer shall fail to maintain
any such office or agency or shall fail to furnish the Trustee and each
such agent with the address thereof, such surrenders, notices and demands
may be made or served at the Corporate Trust Office, and the Issuer hereby
appoints the Trustee as its agent to receive all such surrenders, notices
and demands.
(b) To the extent any of the Securitization Bonds are listed on
the Luxem xxxxx Stock Exchange and the rules of such exchange so require,
(i) the Issuer will maintain in Luxembourg (A) an office and a transfer
agent where Securitization Bonds may be surrendered for registration of
transfer or exchange, (B) an office and a listing agent where notices and
demands to or upon the Issuer in respect of the Securitization Bonds and
this Indenture may be served, and (C) an office and a paying agent where
payments in respect of the Securitization Bonds may be made and (ii) any
reference in this Indenture to the office or agency of the Issuer
referenced in Section 3.02(a) or 3.02(b) shall also refer to such offices,
and the transfer, listing and paying agents, of the Issuer in Luxembourg,
as applicable. The Issuer shall give the Trustee and any other agent
appointed under this Section 3.02(b) prompt written notice of the location
and identity, and of any change in the location or identity, of any such
office or agency.
SECTION 3.03 Money for Payments To Be Held in Trust. (a) As
provided in Section 8.02(a), all payments of principal of and interest on
the Securitization Bonds that are to be made from amounts withdrawn from
the Collection Account pursuant to Section 8.02(g), or Section 4.03 shall
be made on behalf of the Issuer by the Trustee or by another Paying Agent,
and no amounts so withdrawn from the Collection Account for payments of
Securitization Bonds shall be paid over to the Issuer except as provided in
this Section 3.03 and in Section 8.02.
(b) The Issuer shall cause each Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee (and if the Trustee acts as
Paying Agent, it hereby so agrees), subject to the provisions of this
Section 3.03, that such Paying Agent will:
(i) hold all sums held by it for the payment of
principal of or interest on the Securitization Bonds in trust for
the benefit of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein
provided and pay such sums to such Persons as herein provided;
(ii) give the Trustee notice of any Default by
the Issuer (or any other obligor upon the Securitization Bonds) of
which the Paying Agent has actual knowledge in the making of any
payment required to be made with respect to the Securitization
Bonds;
(iii) at any time during the continuance of any
such Default, upon the written request of the Trustee, forthwith
pay to the Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and
forthwith pay to the Trustee all sums held by the Paying Agent in
trust for the payment of Securitization Bonds if at any time the
Paying Agent ceases to meet the standards required to be met by a
Paying Agent at the time of its appointment; and
(v) comply with all requirements of the Code
with respect to the withholding from any payments made by it on
any Securitization Bonds of any applicable withholding taxes
imposed thereon and with respect to any applicable reporting
require ments in connection therewith.
(c) The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by
Issuer Order direct any Paying Agent to pay to the Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which the sums were held by such Paying Agent;
and upon such payment by any Paying Agent to the Trustee, such Paying Agent
shall be released from all further liability with respect to such money.
(d) Subject to applicable laws with respect to escheat of funds or
other applicable abandoned property laws, any money held by the Trustee or
any Paying Agent in trust for the payment of any amount of principal of or
interest on any Securitization Bond and remaining unclaimed for two years
after such amount has become due and payable shall be discharged from such
trust and be paid to the Issuer; and the Holder of such Securitization Bond
shall thereafter, as an unsecured general creditor, look only to the Issuer
for payment thereof (but only to the extent of the amounts so paid to the
Issuer), and all liability of the Trustee or such Paying Agent with respect
to such trust money shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Issuer cause to be published once, in
a newspaper published in the English language, customarily published on
each Business Day and of general circulation in the City of New York, and
in an Authorized Newspaper, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than thirty
(30) days from the date of such publication, any unclaimed balance of such
money then remaining will be repaid to the Issuer. The Trustee may also
adopt and employ, at the expense of the Issuer, any other reason able means
of notification of such repayment (including mailing notice of such
repayment to Holders whose Securitization Bonds have been called but have
not been surrendered for redemption or whose right to or interest in moneys
due and payable but not claimed is determina ble from the records of the
Trustee or of any Paying Agent, at the last address of record for each such
Holder).
SECTION 3.04 Existence. Subject to Section 3.10, the Issuer shall
keep in full effect its existence, rights and franchises as a statutory
limited liability company under the laws of the State of Delaware (unless
it becomes, or any successor Issuer hereunder is or becomes, organized
under the laws of any other State or of the United States of America, in
which case the Issuer will keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and will obtain and
preserve its qualification to do business in each jurisdiction in which
such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Securitization Bonds, the Collateral
and each other instrument or agreement included therein.
SECTION 3.05 Protection of Collateral. (a) The Issuer shall from
time to time execute and deliver all such supplements and amendments hereto
and all such filings, financing statements, continuation statements,
instruments of further assurance and other instruments, and shall take such
other action necessary or advisable to:
(i) maintain and preserve the Grant, Lien and
security interest (and the priority thereof) of this Indenture or
carry out more effectively the purposes hereof;
(ii) perfect, publish notice of or protect the
validity of any Grant made or to be made by this Indenture;
(iii) enforce any of the Collateral, including
any Interest Rate Swap Agreement;
(iv) preserve and defend title to the Collateral
and the rights of the Trustee and the Securitization Bondholders
in the Collateral against the claims of all Persons and parties;
or
(v) pay any and all taxes levied or assessed
upon all or any part of the Collateral.
(b) The Issuer hereby designates the Trustee its agent
and attorney-in-fact to execute any filing with the MPSC, financing
statement, continuation statement or other instru ment required by the
Trustee pursuant to this Section 3.05.
SECTION 3.06 Opinions as to Collateral. (a) On or before March 31
in each calendar year, while any Series is outstanding, commencing March
31, 2002, the Issuer shall furnish to the Trustee an Issuer Opinion of
Counsel either (i) stating that, in the opinion of such counsel, such
action has been taken with respect to the execution and filing of any
filings pursuant to the Michigan UCC and the Delaware UCC of financing
statements and continuation statements as is necessary to maintain the Lien
and security interest, and the first priority thereof, created by this
Indenture and reciting the details of such action or (ii) stating that in
the opinion of such counsel no such action is necessary to maintain such
Grant, Lien and security interest, and the first priority thereof. Such
Issuer Opinion of Counsel shall also describe the execution and filing of
any filings pursuant to the Michigan UCC and the Delaware UCC of financing
statements and continuation statements that will, in the opinion of such
counsel, be required to maintain the Grant, Lien and security interest of
this Indenture until March 31 in the following calendar year.
(b) Prior to the effectiveness of any amendment to the Sale
Agreement, the Servicing Agreement or this Indenture, the Issuer shall
furnish to the Trustee an Issuer Opinion of Counsel either (i) stating
that, in the opinion of such counsel, all filings, including filings
pursuant to the Michigan UCC and the Delaware UCC, have been executed and
filed that are necessary fully to preserve and protect the interest of the
Issuer and the Trustee in the Transferred Securitization Property and the
proceeds thereof, and reciting the details of such filings or referring to
prior Opinions of Counsel in which such details are given, or (ii) stating
that, in the opinion of such counsel, no such action shall be necessary to
preserve and protect such interest.
SECTION 3.07 Performance of Obligations. (a) The Issuer (i) shall
diligently pursue any and all actions to enforce its rights under each
instrument or agreement included in the Collateral and (ii) shall not take
any action and will use its best efforts not to permit any action to be
taken by others that would release any Person from any of such Person's
covenants or obligations under any such instrument or agreement or that
would result in the amendment, hypothecation, subordination, termination or
discharge of, or impair the validity or effectiveness of, any such
instrument or agreement, except, in each case, as expressly provided in
this Indenture, the Sale Agreement, the Servicing Agreement, any Interest
Rate Swap Agreement, any Intercreditor Agreement or any other Basic
Document.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such
duties by a Person identified to the Trustee in an Issuer Officer's
Certificate shall be deemed to be action taken by the Issuer. Initially,
the Issuer has contracted with the Administrator to assist the Issuer in
performing its duties under this Indenture.
(c) The Issuer shall punctually perform and observe in all
material respects all of its obligations and agreements contained in the
Sale Agreement, the Servicing Agreement, any Interest Rate Swap Agreement
and in all other instruments and agreements included in the Collateral.
SECTION 3.08 Negative Covenants. The Issuer shall not:
(a) except as expressly permitted by this Indenture, the Sale
Agreement, the Servicing Agreement, any Interest Rate Swap Agreement, any
Intercreditor Agreement or any other Basic Document, sell, transfer,
exchange or otherwise dispose of any of the Collateral, unless directed to
do so by the Trustee in accordance with Article V;
(b) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Securitization Bonds
(other than amounts properly withheld from such payments under the Code or
pursuant to any Interest Rate Swap Agreement) or assert any claim against
any present or former Securitization Bondholder by reason of the payment of
taxes levied or assessed upon the Issuer or any part of the Collateral;
(c) (i) permit the validity or effectiveness of this
Indenture to be impaired, or permit the Lien of this Indenture to be
amended, hypothecated, subordinated, terminated or discharged, or permit
any Person to be released from any covenants or obligations with respect to
the Securitization Bonds under this Indenture except as may be expressly
permitted hereby, (ii) permit any Lien (other than the Lien created by this
Indenture) to be created on or extend to or otherwise arise upon or burden
the Collateral or any part thereof, any interest therein or the proceeds
thereof or (iii) permit the Lien of this Indenture not to constitute a
continuing valid first priority security interest in the Collateral; or
(d) take any action with respect to which notice is
required to be given to the Rating Agencies in order to satisfy the Rating
Agency Condition if the Issuer or the Trustee has received notice from any
Rating Agency that such action would result in a reduction or with drawal
of the then current rating by such Rating Agency of any Outstanding Series
or Class of Securitization Bonds.
SECTION 3.09 Annual Statement as to Compliance. The
Issuer will deliver to the Trustee, within 120 days after the end of each
fiscal year of the Issuer (commencing with the fiscal year 2001), an Issuer
Officer's Certificate stating, as to the Manager signing such Issuer
Officer's Certificate, that
(a) a review of the activities of the Issuer during such
year (or relevant portion thereof) and of performance under this Indenture
has been made under such Manager's supervi sion; and
(b) to the best of such Manager's knowledge, based on
such review, the Issuer has complied with all conditions and covenants
under this Indenture throughout such calendar year (or relevant portion
thereof), or, if there has been a default in complying with any such
condition or covenant, describing each such default and the nature and
status thereof.
SECTION 3.10 Issuer May Consolidate, etc., Only on
Certain Terms. The Issuer shall not consolidate or merge with or into any
other Person or sell substantially all of its assets to any other Person or
dissolve, unless:
(a) the Person (if other than the Issuer) formed by or
surviving such consolida tion or merger or to whom substantially all of
such assets are sold shall be a Person organized and existing under the
laws of the United States of America or any State and shall expressly
assume by an indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the due and punctual payment
of the principal of and interest on all Securitization Bonds and the
performance or observance of every agreement and covenant of this Indenture
on the part of the Issuer to be performed or observed, all as provided
herein and in the applicable Series Supplement or Series Supplements;
(b) the Person (if other than the Issuer) formed by or
surviving such consolida tion or merger or to whom substantially all of
such assets are sold shall expressly assume all obligations and succeed to
all rights of the Issuer under the Sale Agreement, the Administration
Agreement, the Servicing Agreement, any Intercreditor Agreement and any
Interest Rate Swap Agreement pursuant to an assignment and assumption
agreement executed and delivered to the Trustee, in form satisfactory to
the Trustee;
(c) immediately after giving effect to such
consolidation, merger or sale, no Default or Event of Default shall have
occurred and be continuing;
(d) the Rating Agency Condition shall have been satisfied
with respect to such consolidation or merger or sale;
(e) the Issuer shall have received an Issuer Opinion of
Counsel (and shall have delivered copies thereof to the Trustee)
substantially to the effect that such consolidation, merger or sale (i)
will not have any material adverse tax consequence to the Issuer or any
Securitization Bondholder, (ii) complies in all material respects with this
Indenture and all of the conditions precedent herein relating to such
transaction and (iii) will result in the Trustee maintaining a continuing
valid first priority perfected security interest in the Collateral;
(f) neither the Securitization Property nor the Financing
Order nor the rights of the Seller, the Servicer or the Issuer under the
Customer Choice Act or the Financing Order shall be impaired thereby; and
(g) any action as is necessary to maintain the Lien
created by this Indenture shall have been taken.
SECTION 3.11 Successor or Transferee. (a) Upon any
consolidation or merger of the Issuer in accordance with Section 3.10, the
Person formed by or surviving such consolidation or merger (if other than
the Issuer) shall succeed to, and be substituted for, and may exercise
every right and power of, the Issuer under this Indenture with the same
effect as if such Person had been named as the Issuer herein.
(b) Upon any sale by the Issuer of substantially all of
its assets in a sale which complies with Section 3.10, Consumers Funding
LLC will be released from every covenant and agreement of this Indenture to
be observed or performed on the part of the Issuer with respect to the
Securitization Bonds and from every covenant and agreement of the Sale
Agreement, the Administration Agreement, the Servicing Agreement and any
Interest Rate Swap Agreement to be observed or performed on the part of the
Issuer.
SECTION 3.12 No Other Business. The Issuer shall not
engage in any business other than purchasing and owning Securitization
Property, issuing Securitization Bonds from time to time, pledging its
interest in the Collateral to the Trustee under this Indenture in order to
secure the Securitization Bonds, entering into the Basic Documents and
performing its obliga tions thereunder and performing activities that are
necessary, suitable or convenient to accom plish these purposes or are
incidental thereto and other than as contemplated by the Basic Documents.
SECTION 3.13 No Borrowing. The Issuer shall not issue,
incur, assume, guarantee or otherwise become liable, directly or
indirectly, for any indebtedness except for the Securitization Bonds and
except as contemplated by the Basic Documents.
SECTION 3.14 Guarantees, Loans, Advances and Other
Liabilities. Except as contemplated by the Basic Documents, Issuer shall
not make any loan or advance or credit to, or guarantee (directly or
indirectly or by an instrument having the effect of assuring another's
payment or performance on any obligation or capability of so doing or
otherwise), endorse or otherwise become contingently liable, directly or
indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any
stock, obligations, assets or securities of, or any other interest in, or
make any capital contribution to, any other Person, other than any Eligible
Investments.
SECTION 3.15 Capital Expenditures. The Issuer shall not
make any expendi ture (by long-term or operating lease or otherwise) for
capital assets (either realty or personalty) other than Securitization
Property purchased from the Seller pursuant to, and in accordance with, the
Sale Agreement.
SECTION 3.16 Restricted Payments. The Issuer shall not,
directly or indirectly, (a) pay any dividend or make any distribution (by
reduction of capital or otherwise), whether in cash, property, securities
or a combination thereof, to any owner of a beneficial interest in the
Issuer or otherwise with respect to any ownership or equity interest in, or
owner ship security of, the Issuer, (b) redeem, purchase, retire or
otherwise acquire for value any such ownership or equity interest or
security or (c) set aside or otherwise segregate any amounts for any such
purpose; provided, however, that if no Event of Default shall have occurred
and be continuing or would otherwise result from such payment, the Issuer
may make, or cause to be made, any such distributions to any owner of a
beneficial interest in the Issuer or otherwise with respect to any
ownership or equity interest or security in or of the Issuer using funds
either distributed to the Issuer pursuant to Section 8.02(g) or which are
not otherwise subject to the Lien of this Indenture, to the extent that
such distributions would not cause the book value of the remaining equity
in the Issuer to decline below 0.5% of the original principal amount of all
Series of Securitization Bonds which remain outstanding. The Issuer will
not, directly or indirectly, make payments to or distributions from the
Collection Account except in accordance with this Indenture and the Basic
Documents.
SECTION 3.17 Notice of Events of Default. The Issuer
agrees to deliver to the Trustee, the Rating Agencies and (to the extent
the rules and regulations of the Luxembourg Stock Exchange so require) any
agent in Luxembourg appointed pursuant to Section 3.02(b) written notice in
the form of an Issuer Officer's Certificate of any Default or Event of
Default hereunder or under any of the Basic Documents, its status and what
action the Issuer is taking or proposes to take with respect thereto,
within five Business Days after the occurrence thereof.
SECTION 3.18 Inspection. The Issuer agrees that, on
reasonable prior notice, it will permit any representative of the Trustee,
during the Issuer's normal business hours, to examine all the books of
account, records, reports and other papers of the Issuer, to make copies
and extracts therefrom, to cause such books to be audited annually by
Independent certified public accountants, and to discuss the Issuer's
affairs, finances and accounts with the Issuer's officers, employees and
Independent certified public accountants, all at such reasonable times and
as often as may be reasonably requested. The Trustee shall and shall cause
its representa tives to hold in confidence all such information except to
the extent disclosure may be required by law (and all reasonable
applications for confidential treatment are unavailing) and except to the
extent that the Trustee may reasonably determine that such disclosure is
consistent with its obligations hereunder.
SECTION 3.19 Sale Agreement, Servicing Agreement and Swap
Agreement Covenants. (a) The Issuer agrees to take all such lawful actions
to enforce its rights under the Sale Agreement, the Servicing Agreement and
any Interest Rate Swap Agreement and to compel or secure the performance
and observance by the Seller, the Servicer and any Swap Counterparty, of
each of their obligations to the Issuer under or in connection with the
Sale Agreement, the Servicing Agreement and any Interest Rate Swap
Agreement, respectively, in accordance with the terms thereof. So long as
no Event of Default occurs and is continuing, but subject to Section
3.19(e), the Issuer may exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuer under or in connection with the
Sale Agreement, the Servicing Agreement and any Interest Rate Swap
Agreement.
(b) If an Event of Default occurs and is continuing, the
Trustee may, and, at the direction (which direction shall be in writing or
by telephone (confirmed in writing promptly thereafter)) of (i) with
respect to the Sale Agreement or the Servicing Agreement, the Holders of a
majority of the Outstanding Amount of the Securitization Bonds of all
Series or (ii) with respect to any Interest Rate Swap Agreement, the
Holders of that percentage of the Outstanding Amount of the Securitization
Bonds of the related Class specified in the related Series Supple ment,
shall, exercise all right, remedies, powers, privileges and claims of the
Issuer against the Seller, the Servicer or any Swap Counterparty under or
in connection with the Sale Agreement, the Servicing Agreement and any
Interest Rate Swap Agreement, respectively, including the right or power to
take any action to compel or secure performance or observance by the
Seller, the Servicer or any Swap Counterparty of each of their obligations
to the Issuer thereunder and to give any consent, request, notice,
direction, approval, extension or waiver under the Sale Agreement, the
Servicing Agreement and any Interest Rate Swap Agreement, and any right of
the Issuer to take such action shall be suspended.
(c) With the consent of the Trustee, the Sale Agreement,
the Intercreditor Agreement and the Servicing Agreement may be amended, so
long as the Rating Agency Condition is satisfied in connection therewith,
at any time and from time to time, without the consent of the
Securitization Bondholders, or the counterparty under any Interest Rate
Swap Agreement. However, such amendment may not adversely affect in any
material respect the interest of any Securitization Bondholder or any
counterparty under any Interest Rate Swap Agreement without the consent of
the Holders of a majority of the Outstanding Amount of the Securitization
Bonds of each Series or Class, and each such counterparty, materially and
adversely affected thereby. Further, with the consent of the Trustee and
the related counterparty under any Interest Rate Swap Agreement, any
Interest Rate Swap Agreement may be amended, at any time and from time to
time, so long as the Rating Agency Condition is satisfied in connec tion
therewith. However, such amendment may not adversely affect in any material
respect the interest of any Securitization Bondholder or counterparty under
any Interest Rate Swap Agree ment without the consent of the Holders of a
majority of the Outstanding Amount of the Securitization Bonds of each
Series or Class and each such counterparty materially and adversely
affected thereby.
(d) If the Issuer, the Seller or the Servicer proposes to
amend, modify, waive, supplement, terminate or surrender, or agree to any
amendment, modification, waiver, supple ment, termination, or surrender of,
the terms of the Sale Agreement, the Servicing Agreement, the Intercreditor
Agreement or any Interest Rate Swap Agreement, or waive timely performance
or observance thereunder by the Seller, the Servicer or any Swap
Counterparty under the Sale Agreement, the Servicing Agreement, the
Intercreditor Agreement or any Interest Rate Swap Agreement, respectively,
in each case in such a way as would materially and adversely affect the
interests of any Class of any Series of Securitization Bondholders or the
counterparty under any Interest Rate Swap Agreement, the Issuer shall first
notify the Rating Agencies of the proposed amendment, modification,
termination or surrender. Upon receiving notification regarding whether the
Rating Agency Condition has been satisfied, the Issuer shall notify the
Trustee, and the Trustee shall notify the Securitization Bondholders and
each counterparty under any Interest Rate Swap Agreement, of the proposal
and whether the Rating Agency Condition has been satisfied with respect
thereto. With respect to any such proposed action related to the Sale
Agreement, the Intercreditor Agreement and the Servicing Agreement, the
Trustee shall consent to such proposed action only (i) with the consent of
the Holders of a majority of the Outstanding Amount of the Securitization
Bonds of each Class of each Series, and each counterparty under any
Interest Rate Swap Agreement, materially and adversely affected thereby and
(ii) upon satisfaction of the Rating Agency Condition. With respect to any
such proposed action related to any Interest Rate Swap Agreement, the
Trustee shall consent to such proposed action only (y) with the consent of
the Holders of a majority of the Outstanding Amount of the Securitization
Bonds of the related Class, and each counterparty under any Interest Rate
Swap Agreement, materially and adversely affected thereby and (z) upon
satisfaction of the Rating Agency Condition. If any such amendment,
modification, supplement or waiver shall be so consented to by the Trustee
or such Holders, the Issuer agrees to execute and deliver, in its own name
and at its own expense, such agreements, instruments, consents and other
documents as shall be necessary or appropriate in the circumstances. For so
long as any of the Securitization Bonds are listed on the Luxembourg Stock
Exchange and the rules of that exchange so require, the Issuer will publish
notice of such proposed action in an Authorized Newspaper promptly
following its effectiveness.
(e) If the Issuer or the Servicer proposes to amend,
modify, waive, supple ment, terminate or surrender in any material respect,
or to agree to any material amendment, modification, waiver, supplement,
termination or surrender of, the Securitization Charge Adjustment Process,
the Issuer shall notify the Trustee and the Trustee shall notify
Securitization Bondholders of such proposal and the Trustee shall consent
thereto only with the consent of the Holders a majority of the Outstanding
Amount of the Securitization Bonds of each Series materially and adversely
affected thereby and only if the Rating Agency Condition has been satisfied
with respect thereto.
(f) Promptly following a default by either the Seller,
the Servicer or any Swap Counterparty under the Sale Agreement, the
Servicing Agreement or any Interest Rate Swap Agreement, respectively, and
at the Issuer's expense, the Issuer agrees to take all such lawful actions
as the Trustee may request to compel or secure the performance and
observance by the Seller, the Servicer or any Swap Counterparty, as
applicable, of each of their obligations to the Issuer under or in
connection with the Sale Agreement, the Servicing Agreement or any Interest
Rate Swap Agreement in accordance with the terms thereof, and to exercise
any and all rights, remedies, powers and privileges lawfully available to
the Issuer under or in connection with the Sale Agreement, the Servicing
Agreement or any Interest Rate Swap Agreement, respectively, to the extent
and in the manner directed by the Trustee, including the transmission of
notices of default on the part of the Seller, the Servicer or any Swap
Counterparty thereunder and the institution of legal or administrative
actions or proceedings to compel or secure performance by the Seller, the
Servicer or any Swap Counterparty of each of their respective obligations
under the Sale Agreement, the Servicing Agreement and any Interest Rate
Swap Agreement.
(g) If the Issuer shall have knowledge of the occurrence
of a Servicer Default under the Servicing Agreement or an event of default,
termination event or downgrade event under any Interest Rate Swap
Agreement, the Issuer shall promptly give written notice thereof to the
Trustee and the Rating Agencies, and shall specify in such notice the
action, if any, the Issuer is taking with respect to such default or event.
(h) If a Servicer Default shall arise from the failure of
the Servicer to perform any of its duties or obligations under the
Servicing Agreement with respect to the Securitization Property or the
Securitization Charge, the Issuer shall take all reasonable steps available
to it to remedy such failure. The Issuer shall not take any action to
terminate the Servicer's rights and powers under the Servicing Agreement
following a Servicer Default without the prior written consent of the
Trustee and of the Holders of a majority of the Outstanding Amount of the
Securitization Bonds of all Series and unless such termination is permitted
under the Intercreditor Agreement.
(i) As promptly as possible after the giving of notice of
termination to the Servicer and the Rating Agencies of the Servicer's
rights and powers pursuant to Section 6.01 of the Servicing Agreement, the
Trustee, with the consent of the Holders of Securitization Bonds evidencing
not less than a majority of the Outstanding Amount of the Securitization
Bonds of all Series and subject to the terms of the Intercreditor
Agreement, may appoint a successor Servicer (the "Successor Servicer"), and
such Successor Servicer shall accept its appointment by a written
assumption in a form acceptable to the Issuer and the Trustee. A person
shall qualify as a Successor Servicer only if such Person satisfies the
requirements of Section 6.04 of the Servicing Agreement. In connection with
any such appointment, the Issuer may make such arrangements for the
compensation of such Successor Servicer as it and such Successor Servicer
shall agree, subject to the limitations set forth below and in the
Servicing Agreement and the terms of the Intercreditor Agreement, and in
accordance with Section 6.04 of the Servicing Agreement, the Issuer shall
enter into an agreement with such Successor Servicer for the servicing of
the Securitization Property (such agreement to be in form and substance
satisfactory to the Trustee).
(j) Upon termination of the Servicer's rights and powers
pursuant to the Servicing Agreement, the Trustee shall promptly notify the
Issuer, the Securitization Bondhold ers and the Rating Agencies of such
termination. As soon as a Successor Servicer is appointed, the Issuer shall
notify the Trustee, the Securitization Bondholders and the Rating Agencies
of such appointment, specifying in such notice the name and address of such
Successor Servicer.
(k) The Issuer shall not take any action to terminate or
assign the Swap Counterparty's rights and powers under any Interest Rate
Swap Agreement or replace any Swap Counterparty following an event of
default, termination event or downgrade event under any Interest Rate Swap
Agreement without (i) the prior written consent of the Trustee and of the
Holders of that percentage of the Outstanding Amount of the Securitization
Bonds, if any such consent is required under the related Series Supplement,
of the related Series and Class, if any, specified in the related Series
Supplement, and (ii) satisfying any other requirements set forth in the
related Series Supplement and Interest Rate Swap Agreement.
(l) Upon termination or assignment of any Swap
Counterparty's rights and powers, pursuant to any Interest Rate Swap
Agreement, the Trustee shall promptly inform the Issuer, the Securitization
Bondholders of the related Class and the Rating Agencies of such
termination or assignment. As soon as a replacement Swap Counterparty is
appointed, the Issuer shall notify the Trustee, the Securitization
Bondholders of the related Class and the Rating Agencies of such
appointment, specifying in such notice the name and address of such replace
ment Swap Counterparty.
SECTION 3.20 Taxes. So long as any of the Securitization
Bonds are outstand ing, the Issuer shall pay all material taxes,
assessments and governmental charges imposed upon it or any of its
properties or assets or with respect to any of its franchises, business,
income or property before any penalty accrues thereon if the failure to pay
any such taxes, assessments and governmental charges would, after any
applicable grace periods, notices or other similar requirements, result in
a Lien on the Collateral.
ARTICLE IV
Satisfaction and Discharge; Defeasance
SECTION 4.01 Satisfaction and Discharge of Indenture;
Defeasance. (a) The Securitization Bonds of any Series, all moneys payable
with respect thereto and this Indenture as it applies to such Series shall
cease to be of further effect and the Lien hereunder shall be released with
respect to such Series, interest shall cease to accrue on the
Securitization Bonds of such Series and the Trustee, on demand of and at
the expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to the
Securitization Bonds of such Series, when
(i) either
(A) all Securitization Bonds of such
Series theretofore authenti cated and delivered (other
than (1) Securitization Bonds that have been destroyed,
lost or stolen and that have been replaced or paid as
provided in Section 2.06 and (2) Securitization Bonds for
whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Issuer or
thereafter repaid to the Issuer or discharged from such
trust, as provided in Section 3.03(d) have been delivered
to the Trustee for cancellation; or
(B) the Expected Final Payment Date or
Redemption Date has occurred with respect to all
Securitization Bonds of such Series not theretofore
delivered to the Trustee for cancellation, and the Issuer
has irrevocably deposited or caused to be irrevocably
deposited with the Trustee cash, in trust for such
purpose, in an amount sufficient to pay and discharge the
entire indebtedness on such Securitization Bonds not
theretofore delivered to the Trustee on the Expected
Final Payment Date or Redemption Date, as applicable,
therefor;
(ii) the Issuer has paid or caused to be paid
all other sums payable hereunder by the Issuer with respect to
such Series; and
(iii) the Issuer has delivered to the Trustee an
Issuer Officer's Certifi cate, an Issuer Opinion of Counsel and
(if required by the TIA or the Trustee) an Inde pendent
Certificate from a firm of certified public accountants, each
meeting the applica ble requirements of Section 11.01 and each
stating that all conditions precedent herein provided for relating
to the satisfaction and discharge of this Indenture with respect
to Securitization Bonds of such Series have been complied with.
(b) Subject to Sections 4.01(e) and 4.02, the Issuer at
any time may terminate (i) all its obligations under this Indenture with
respect to the Securitization Bonds of any Series ("Legal Defeasance
Option") or (ii) its obligations under Sections 3.04, 3.05, 3.06,(other
than with respect to amounts in the Defeasance Account), 3.07, 3.08, 3.09,
3.10, 3.12, 3.13, 3.14, 3.15, 3.16, 3.17, 3.18, 3.19 and 3.20 and the
operation of Section 5.01(d) ("Covenant Defeasance Option") with respect to
any Series of Securitization Bonds. The Issuer may exercise the Legal
Defeasance Option with respect to any Series of Securitization Bonds
notwithstanding its prior exercise of the Covenant Defeasance Option with
respect to such Series.
(c) If the Issuer exercises the Legal Defeasance Option
with respect to any Series, the maturity of the Securitization Bonds of
such Series may not be (i) accelerated pursuant to Section 5.02 or (ii)
except as provided in Section 4.02, redeemed. If the Issuer exercises the
Covenant Defeasance Option with respect to any Series, the maturity of the
Securitization Bonds of such Series may not be accelerated because of an
Event of Default specified in Section 5.01(d).
(d) Upon satisfaction of the conditions set forth herein
to the exercise of the Legal Defeasance Option or the Covenant Defeasance
Option with respect to any Series of Securitization Bonds, the Trustee, on
demand of and at the expense of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of the obligations
that are termi nated pursuant to such exercise.
(e) Notwithstanding Sections 4.01(a) and 4.01(b) above,
(i) rights of registra tion of transfer and exchange, (ii) rights of
substitution of mutilated, destroyed, lost or stolen Securitization Bonds,
(iii) rights of Securitization Bondholders to receive payments of principal
and interest, but only from the amounts deposited with the Trustee for such
payments, (iv) Sections 4.03 and 4.04, (v) the rights, obligations and
immunities of the Trustee hereunder (including the rights of the Trustee
under Section 6.07 and the obligations of the Trustee under Section 4.03)
and (vi) the rights of Securitization Bondholders under this Indenture with
respect to the property deposited with the Trustee payable to all or any of
them, shall survive until the Securitization Bonds of the Series as to
which this Indenture or certain obligations hereunder have been satisfied
and discharged pursuant to Section 4.01(a) or 4.01(b) and have been paid in
full. Thereafter, the obligations in Sections 6.07 and 4.04 with respect to
such Series shall survive.
SECTION 4.02 Conditions to Defeasance. (a) The Issuer may
exercise the Legal Defeasance Option or the Covenant Defeasance Option with
respect to any Series of Securitization Bonds only if:
(i) the Issuer irrevocably deposits or causes to
be deposited in trust with the Trustee cash or U.S. Government
Obligations for the payment of principal of and interest on such
Series of Securitization Bonds to the Expected Payment Date or
Redemp tion Date therefor, as applicable, such deposit to be made
in the Defeasance Subaccount for such Series of Securitization
Bonds;
(ii) the Issuer delivers to the Trustee a
certificate from a nationally recognized firm of Independent
accountants expressing its opinion that the payments of principal
and interest when due and without reinvestment on the deposited
U.S. Govern ment Obligations plus any deposited cash without
investment will provide cash at such times and in such amounts
(but, in the case of the Legal Defeasance Option only, not more
than such amounts) as will be sufficient to pay in respect of the
Securitization Bonds of such Series (A) subject to clause (B),
principal in accordance with the Expected Amortization Schedule
therefor, (B) if such Series is to be redeemed, the Redemption
Price therefor on the Redemption Date therefor and (C) interest
when due;
(iii) in the case of the Legal Defeasance
Option, ninety-five (95) days pass after the deposit is made and
during such ninety-five (95) day period no Default specified in
Section 5.01(e) or 5.01(f) occurs which is continuing at the end
of the period; provided, however, that in determining whether a
default under Section 5.01(e) has occurred, the requirement that
the decree or order shall remain unstayed and in effect for ninety
(90) days shall be disregarded;
(iv) no Default has occurred and is continuing
on the day of such deposit and after giving effect thereto;
(v) in the case of the Legal Defeasance Option,
the Issuer delivers to the Trustee an Issuer Opinion of Counsel of
nationally recognized tax counsel stating that (A) the Issuer has
received from, or there has been published by, the Internal
Revenue Service a ruling, or (B) since the date of execution of
this Indenture, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the
Securitization Bonds of such Series will not recognize income,
gain or loss for federal income tax purposes as a result of the
exercise of such Legal Defeasance Option and will be subject to
federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such legal
defeasance had not occurred;
(vi) in the case of the Covenant Defeasance
Option, the Issuer delivers to the Trustee an Issuer Opinion of
Counsel of nationally recognized tax counsel to the effect that
the Holders of the Securitization Bonds of such Series will not
recognize income, gain or loss for federal income tax purposes as
a result of the exercise of such Covenant Defeasance Option and
will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if
such covenant defeasance had not occurred; and
(vii) the Issuer delivers to the Trustee an
Issuer Officer's Certificate and an Issuer Opinion of Counsel,
each stating that all conditions precedent to the satisfaction and
discharge of the Securitization Bonds of such Series to the extent
contemplated by this Article IV have been complied with.
(b) Notwithstanding any other provision of this Section
4.02 to the contrary, no delivery of cash or U.S. Government Obligations to
the Trustee under this Section 4.02 shall terminate any obligations of the
Issuer under this Indenture with respect to any Securitization Bonds which
are to be redeemed prior to the Expected Final Payment Date therefor until
such Securitization Bonds shall have been irrevocably called or designated
for redemption on a date thereafter on which such Securitization Bonds may
be redeemed in accordance with the provi sions of this Indenture and proper
notice of such redemption shall have been given in accordance with the
provisions of this Indenture or the Issuer shall have given the Trustee, in
form satisfac tory to the Trustee, irrevocable instructions to give, in the
manner and at the times prescribed herein, notice of redemption of such
Series.
SECTION 4.03 Application of Trust Money. All moneys or
U.S. Government Obligations deposited with the Trustee pursuant to Sections
4.01 or 4.02 with respect to any Series of Securitization Bonds shall be
held in trust in the Defeasance Subaccount for such Series and applied by
it, in accordance with the provisions of the Securitization Bonds and this
Indenture, to the payment, either directly or through any Paying Agent, as
the Trustee may determine, to the Holders of the particular Securitization
Bonds for the payment or redemption of which such moneys have been
deposited with the Trustee, of all sums due and to become due thereon for
principal and interest. Such moneys shall be segregated and held apart
solely for paying such Securitization Bonds and such Securitization Bonds
shall not be entitled to any amounts on deposit in the Collection Account
other than amounts on deposit in the Defeasance Subaccount for such
Securitization Bonds.
SECTION 4.04 Repayment of Moneys Held by Paying Agent. In
connection with the satisfaction and discharge of this Indenture or the
Covenant Defeasance Option or Legal Defeasance Option with respect to the
Securitization Bonds of any Series, all moneys then held by any Paying
Agent other than the Trustee under the provisions of this Indenture with
respect to such Securitization Bonds shall, upon demand of the Issuer, be
paid to the Trustee to be held and applied according to Section 3.03 and
thereupon such Paying Agent shall be released from all further liability
with respect to such moneys.
ARTICLE V
Remedies
SECTION 5.01 Events of Default. "Event of Default"
wherever used herein, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) default in the payment of any interest on any
Securitization Bond when the same becomes due and payable and the
continuation of such default for five Business Days;
(b) default in the payment of the then unpaid principal
of any Securitization Bond of any Series or Class on the Final Maturity
Date therefor;
(c) default in the payment of the Redemption Price for
any Securitization Bond on the Redemption Date therefor;
(d) default in the observance or performance of any
covenant or agreement of the Issuer made in this Indenture (other than a
covenant or agreement, a default in the observance or performance of which
is specifically dealt with in clause (a), (b) or (c) above), or any
representation or warranty of the Issuer made in this Indenture or in any
certificate or other writing delivered pursuant hereto or in connection
herewith proving to have been incorrect in any material respect as of the
time when made, and any such default shall continue or not be cured, for a
period of 30 days after the earlier of (i) the date on which there shall
have been given, by registered or certified mail, to the Issuer by the
Trustee or to the Issuer and the Trustee by the Holders of at least 25% of
the Outstanding Amount of the Securitization Bonds of any Series or Class,
a written notice specifying such default or incorrect representation or
warranty and requiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder or (ii) the date the Issuer has knowledge of
the default;
(e) the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuer or any
substantial part of the Collateral in an involuntary case or proceeding
under any applicable federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official
for the Issuer or for any substantial part of the Collateral, or ordering
the winding-up or liquidation of the Issuer's affairs, and such decree or
order shall remain unstayed and in effect for a period of ninety (90)
consecutive days;
(f) the commencement by the Issuer of a voluntary case or
proceeding under any applicable federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or the consent by the Issuer
to the entry of an order for relief in an involuntary case under any such
law, or the consent by the Issuer to the appointment or taking possession
by a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official for the Issuer or for any substantial part of the
Collateral, or the making by the Issuer of any assignment for the benefit
of creditors, or the failure by the Issuer generally to pay its debts as
such debts become due, or the taking of action by the Issuer in furtherance
of any of the foregoing; or
(g) any act or failure to act by the State of Michigan or
any of its agencies (including the MPSC), officers or employees that
violates or is not in accordance with the pledge of the State of Michigan
in Section 10n(2) of the Customer Choice Act.
SECTION 5.02 Acceleration of Maturity; Rescission and
Annulment (a) If an Event of Default (other than an Event of Default under
Section 5.01(g)) occurs and is continuing, then and in every such case
either the Trustee or the Holders of Securitization Bonds representing not
less than a majority of the Outstanding Amount of the Securitization Bonds
of all Series may, but need not, declare all the Securitization Bonds to be
immediately due and payable, by a notice in writing to the Issuer (and to
the Trustee if given by Securitization Bondholders), and upon any such
declaration the unpaid principal amount of the Securitization Bonds of all
Series, together with accrued and unpaid interest thereon through the date
of acceleration, shall become immediately due and payable.
(b) At any time after such declaration of acceleration of
maturity has been made and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter provided in this
Article V, the Holders of Securitization Bonds represent ing a majority of
the Outstanding Amount of the Securitization Bonds of all Series, by
written notice to the Issuer and the Trustee, may rescind and annul such
declaration and its conse quences, provided that:
(i) the Issuer has paid or deposited with the
Trustee, for deposit in the General Subaccount of the Collection
Account, a sum sufficient to pay
(A) all payments of principal of and
interest on all Securitiza tion Bonds of all Series and
all other amounts that would then be due hereunder or
upon such Securitization Bonds if the Event of Default
giving rise to such acceler ation had not occurred; and
(B) all sums paid or advanced by the
Trustee hereunder and the reasonable compensation,
expenses, disbursements and advances of the Trustee and
its agents and counsel; and
(ii) all Events of Default, other than the
nonpayment of the principal of the Securitization Bonds of all
Series that has become due solely by such acceleration, have been
cured or waived as provided in Section 5.12.
(c) No such rescission shall affect any subsequent
Default or impair any right consequent thereto.
SECTION 5.03 Collection of Indebtedness and Suits for
Enforcement by Trustee. (a) The Issuer covenants that if (i) Default is
made in the payment of any interest on any Securitization Bond when such
interest becomes due and payable and such Default continues for [five]
Business Days, (ii) Default is made in the payment of the then unpaid
principal of any Securitization Bond on the Final Maturity Date therefor or
(iii) Default is made in the payment of the Redemption Price or for any
Securitization Bond on the Redemption Date therefor, the Issuer shall, upon
demand of the Trustee, pay to it, for the benefit of the Holders of the
Securitization Bonds of such Series, such amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee and its
agents and counsel and the whole amount then due and payable on such
Securiti zation Bonds for principal and interest, with interest upon the
overdue principal and, to the extent payment at such rate of interest shall
be legally enforceable, upon overdue instalments of interest, at the
respective Interest Rate of such Series or the applicable Class of such
Series.
(b) In case the Issuer shall fail forthwith to pay the
amounts specified in clause (a) above upon such demand, the Trustee, in its
own name and as trustee of an express trust, may institute a Proceeding for
the collection of the sums so due and unpaid, and may prosecute such
Proceeding to judgment or final decree, and may enforce the same against
the Issuer or other obligor upon such Securitization Bonds and collect in
the manner provided by law out of the property of the Issuer or other
obligor upon such Securitization Bonds, wherever situated, the moneys
adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the
Trustee may, as more particularly provided in Section 5.04, in its
discretion, proceed to protect and enforce its rights and the rights of the
Securitization Bondholders, by such appropriate Proceedings as the Trustee
shall deem most effective to protect and enforce any such rights, whether
for the specific enforcement of any covenant or agreement in this Indenture
or in aid of the exercise of any power granted herein, or to enforce any
other proper remedy or legal or equitable right vested in the Trustee by
this Indenture or by law including foreclosing or otherwise enforcing the
Lien on the Securitization Property securing the Securitization Bonds or
applying to the MPSC or a court of competent jurisdiction for sequestration
of revenues arising with respect to such Securitization Property.
(d) In case there shall be pending, relative to the
Issuer or any other obligor upon the Securitization Bonds or any Person
having or claiming an ownership interest in the Collateral, Proceedings
under Title 11 of the United States Code or any other applicable federal or
state bankruptcy, insolvency or other similar law, or in case a receiver,
assignee or trustee in bankruptcy or reorganization, liquidator,
sequestrator or similar official shall have been ap pointed for or taken
possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial Proceedings relative to the
Issuer or other obligor upon the Securitization Bonds, or to the creditors
or property of the Issuer or such other obligor, the Trustee, irrespective
of whether the principal of any Securitization Bonds shall then be due and
payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand pursuant to
the provisions of this Section 5.03, shall be entitled and empowered, by
intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the
whole amount of principal and interest owing and unpaid in respect
of the Securitization Bonds and to file such other papers or
documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for reasonable
compensation to the Trustee and each predecessor Trustee, and
their respective agents, attorneys and counsel, and for
reimbursement of all expenses and liabilities incurred, and all
advances made, by the Trustee and each predecessor Trustee, except
as a result of negligence or bad faith) and of the Securitization
Bondholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of Securitization
Bonds in any election of a trustee, a standby trustee or Person
performing similar functions in any such Proceedings;
(iii) to collect and receive any moneys or other
property payable or deliverable on any such claims and to
distribute all amounts received with respect to the claims of the
Securitization Bondholders and of the Trustee on their behalf; and
(iv) to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to
have the claims of the Trustee or the Holders of Securitization
Bonds allowed in any judicial proceedings relative to the Issuer,
its creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official
in any such Proceeding is hereby authorized by each of such Securitization
Bondholders to make payments to the Trustee, and, in the event that the
Trustee shall consent to the making of payments directly to such
Securitization Bondholders, to pay to the Trustee such amounts as shall be
sufficient to cover reasonable compensation to the Trustee, each
predecessor Trustee and their respective agents, attorneys and counsel, and
all other expenses and liabilities incurred, and all advances made, by the
Trustee and each predecessor Trustee except as a result of negligence or
bad faith.
(e) Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Securitization Bondholder any plan of reorganization,
arrangement, adjustment or composition affecting the Securitization Bonds
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Securitization Bondholder in any such
proceeding except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar Person.
(f) All rights of action and of asserting claims under
this Indenture, or under any of the Securitization Bonds, may be enforced
by the Trustee without the possession of any of the Securitization Bonds or
the production thereof in any trial or other Proceedings relative thereto,
and any such action or proceedings instituted by the Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of
judgment, subject to the payment of the expenses, disbursements and
compensation of the Trustee, each predecessor Trustee and their respective
agents and attorneys, shall be for the ratable benefit of the Holders of
the Securitiza tion Bonds.
(g) In any Proceedings brought by the Trustee (and also
any Proceedings involving the interpretation of any provision of this
Indenture to which the Trustee shall be a party), the Trustee shall be held
to represent all the Holders of the Securitization Bonds, and it shall not
be necessary to make any Securitization Bondholder a party to any such
Proceedings.
SECTION 5.04 Remedies. (a) If an Event of Default other
than under Section 5.01(g) occurs and is continuing, the Trustee may do one
or more of the following (subject to Section 5.05):
(i) institute Proceedings in its own name and as
trustee of an express trust for the collection of all amounts then
payable on the Securitization Bonds or under this Indenture with
respect thereto, whether by declaration or otherwise, enforce any
judgment obtained, and collect from the Issuer and any other
obligor upon such Securiti zation Bonds moneys adjudged due;
(ii) institute Proceedings from time to time for
the complete or partial foreclosure of this Indenture with respect
to the Collateral;
(iii) exercise any remedies of a secured party
under the Michigan UCC, the Delaware UCC or the Customer Choice
Act or any other applicable law and take any other appropriate
action to protect and enforce the rights and remedies of the
Trustee and the Holders of the Securitization Bonds of such
Series;
(iv) sell the Collateral or any portion thereof
or rights or interest therein, at one or more public or private
sales called and conducted in any manner permitted by law; and
(v) exercise all rights, remedies, powers,
privileges and claims of the Issuer against the Seller, the
Administrator, the Servicer or any Swap Counterparty under or in
connection with the Sale Agreement, the Administration Agreement,
the Servicing Agreement or any Interest Rate Swap Agreement,
respectively, as provided in Section 3.20(b);
provided, however, that the Trustee may not sell or otherwise liquidate any
portion of the Collateral following an Event of Default, other than an
Event of Default described in Section 5.01(a), 5.01(b) or 5.01(c), with
respect to any Series unless (A) the Holders of one hundred percent (100%)
of the Outstanding Amount of the Securitization Bonds of all Series consent
thereto, (B) the proceeds of such sale or liquidation distributable to the
Securitization Bondhold ers of all Series are sufficient to discharge in
full all amounts then due and unpaid upon such Securitization Bonds for
principal and interest, or (C) the Trustee determines that the Collateral
will not continue to provide sufficient funds for all payments on the
Securitization Bonds of all Series as they would have become due if the
Securitization Bonds had not been declared due and payable and the Trustee
obtains the consent of Holders of 662/3% of the Outstanding Amount of the
Securitization Bonds of all Series. In determining such sufficiency or
insufficiency with respect to clause (B) and (C), the Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking
or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Collateral for such
purpose.
(b) If an Event of Default under Section 5.01(g) occurs
and is continuing, the Trustee, for the benefit of the Holders, shall be
entitled and empowered to the extent permitted by applicable law to
institute or participate in Proceedings reasonably necessary to compel
performance of or to enforce the pledge of the State of Michigan in Section
10n(2) of the Customer Choice Act and to collect any monetary damages
incurred by the Holders or the Trustee as a result of any such Event of
Default, and may prosecute any such Proceeding to final judgment or decree.
Such remedy shall be the only remedy that the Trustee may exercise if the
only Event of Default that has occurred and is continuing is an Event of
Default under Section 5.01(g).
SECTION 5.05 Optional Preservation of the Collateral. If
the Securitization Bonds have been declared to be due and payable under
Section 5.02 following an Event of Default and such declaration and its
consequences have not been rescinded and annulled, the Trustee may, but
need not, elect, as provided in Section 5.11(c), to maintain possession of
the Collateral and not sell or liquidate the same. It is the desire of the
parties hereto and the Securitization Bondholders that there be at all
times sufficient funds for the payment of principal of and interest on the
Securitization Bonds, and the Trustee shall take such desire into account
when determining whether or not to maintain possession of the Collateral or
sell or liquidate the same. In determining whether to maintain possession
of the Collateral or sell or liquidate the same, the Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking
or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Collateral for such
purpose.
SECTION 5.06 Limitation of Proceedings. (a) No Holder of
any Securitiza tion Bond of any Series shall have any right to institute
any Proceeding, judicial or otherwise, or to avail itself of any remedies
provided in the Customer Choice Act, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:
(i) such Holder has previously given written
notice to the Trustee of a continuing Event of Default;
(ii) the Holders of not less than twenty-five
percent (25%) of the Outstanding Amount of the Securitization
Bonds of all Series have made written request to the Trustee to
institute such Proceeding in respect of such Event of Default in
its own name as Trustee hereunder;
(iii) such Holder or Holders have offered to the
Trustee security or indemnity reasonably satisfactory to the
Trustee against the costs, expenses and liabilities to be incurred
in complying with such request;
(iv) the Trustee for 60 days after its receipt
of such notice, request and offer of indemnity has failed to
institute such Proceedings; and
(v) no direction inconsistent with such written
request has been given to the Trustee during such 60 day period by
the Holders of a majority of the Outstanding Amount of the
Securitization Bonds of all Series;
it being understood and intended that no one or more Holders of
Securitization Bonds shall have any right in any manner whatever by virtue
of, or by availing of, any provision of this Indenture to affect, disturb
or prejudice the rights of any other Holders of Securitization Bonds or to
obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided.
(b) In the event the Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Securitization Bonds, each representing less than a majority of the
Outstanding Amount of the Securitization Bonds of all Series, the Trustee
in its sole discretion may determine what action, if any, shall be taken,
notwithstanding any other provisions of this Indenture.
SECTION 5.07 Unconditional Rights of Securitization
Bondholders To Receive Principal and Interest. Notwithstanding any other
provisions in this Indenture, the Holder of any Securitization Bond shall
have the right, which is absolute and unconditional, and shall not be
impaired without the consent of each such Holder, (a) to receive payment of
(i) the interest, if any, on such Securitization Bond on or after the due
dates thereof expressed in such Securitization Bond or in this Indenture,
(ii) the unpaid principal, if any, of such Securitization Bonds on or after
the Final Maturity Date therefor or (iii) in the case of redemption,
receive payment of the unpaid principal, if any, and interest, if any, on
such Securitization Bond on or after the Redemption Date therefor and (b)
to institute suit for the enforcement of any such payment, and such right
shall not be impaired without the consent of such Holder.
SECTION 5.08 Restoration of Rights and Remedies. If the
Trustee or any Securitization Bondholder has instituted any Proceeding to
enforce any right or remedy under this Indenture and such Proceeding has
been discontinued or abandoned for any reason or has been determined
adversely to the Trustee or to such Securitization Bondholder, then and in
every such case the Issuer, the Trustee and the Securitization Bondholders
shall, subject to any determination in such Proceeding, be restored
severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Trustee and the Securitization
Bondhold ers shall continue as though no such Proceeding had been
instituted.
SECTION 5.09 Rights and Remedies Cumulative. No right or
remedy herein conferred upon or reserved to the Trustee or to the
Securitization Bondholders is intended to be exclusive of any other right
or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 5.10 Delay or Omission Not a Waiver. No delay or
omission of the Trustee or any Securitization Bondholder to exercise any
right or remedy accruing upon any Default or Event of Default shall impair
any such right or remedy or constitute a waiver of any such Default or
Event of Default or an acquiescence therein. Every right and remedy given
by this Article V or by law to the Trustee or to the Securitization
Bondholders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Securitiza tion Bondholders, as
the case may be.
SECTION 5.11 Control by Securitization Bondholders. The
Holders of a majority of the Outstanding Amount of the Securitization Bonds
of all Series (or, if less than all Series or Classes are affected, the
affected Series or Class or Classes) shall have the right to direct the
time, method and place of conducting any Proceeding for any remedy
available to the Trustee with respect to the Securitization Bonds of such
Series or Class or Classes or exercising any trust or power conferred on
the Trustee with respect to such Series or Class or Classes; provided that
(a) such direction shall not be in conflict with any rule
of law or with this Indenture or any intercreditor agreement;
(b) subject to the express terms of Section 5.04, any
direction to the Trustee to sell or liquidate the Collateral shall be by
the Holders of Securitization Bonds representing not less than one hundred
percent (100%) of the Outstanding Amount of the Securitization Bonds of all
Series;
(c) if the conditions set forth in Section 5.05 have been
satisfied and the Trustee elects to retain the Collateral pursuant to such
Section and elects not to sell or liquidate the same, then any direction to
the Trustee by Holders of Securitization Bonds representing less than one
hundred percent (100%) of the Outstanding Amount of the Securitization
Bonds of all Series to sell or liquidate the Collateral shall be of no
force and effect; and
(d) the Trustee may take any other action deemed proper
by the Trustee that is not inconsistent with such direction;
provided, however, that, subject to Section 6.01, the Trustee need not take
any action that it determines might involve it in liability for which it
reasonably believes it will not be adequately indemnified against the
costs, expenses and liabilities which might be incurred by it in complying
with this request. The Trustee also need not take any action that it
determines might materially and adversely affect the rights of any
Securitization Bondholders not consenting to such action.
SECTION 5.12 Waiver of Past Defaults. (a) Prior to the
declaration of the acceleration of the maturity of the Securitization Bonds
of all Series as provided in Section 5.02, the Holders of not less than a
majority of the Outstanding Amount of the Securitization Bonds of all
Series may waive any past Default or Event of Default and its consequences
except a Default (i) in payment of principal of or interest on any of the
Securitization Bonds or (ii) in respect of a covenant or provision hereof
which cannot be modified or amended without the consent of the Holder of
each Securitization Bond of all Series or Classes affected. In the case of
any such waiver, the Issuer, the Trustee and the Holders of the
Securitization Bonds shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any subsequent
or other Default or impair any right consequent thereto.
(b) Upon any such waiver, such Default shall cease to
exist and be deemed to have been cured and not to have occurred, and any
Event of Default arising therefrom shall be deemed to have been cured and
not to have occurred, for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or Event of Default
or impair any right consequent thereto.
SECTION 5.13 Undertaking for Costs. All parties to this
Indenture agree, and each Holder of any Securitization Bond by such
Holder's acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right
or remedy under this Indenture, or in any suit against the Trustee for any
action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and
that such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section 5.13 shall not
apply to (a) any suit instituted by the Trustee, (b) any suit instituted by
any Securitization Bondholder, or group of Securitization Bondholders, in
each case holding in the aggregate more than ten percent (10%) of the
Outstanding Amount of the Securitization Bonds of a Series or (c) any suit
instituted by any Securitization Bondholder for the enforcement of the
payment of (i) interest on any Securitization Bond on or after the due
dates expressed in such Securitization Bond and in this Indenture, (ii) the
unpaid principal, if any, of any Securitiza tion Bond on or after the Final
Maturity Date therefor or (iii) in the case of redemption, the unpaid
principal of and interest on any Securitization Bond on or after the
Redemption Date therefor.
SECTION 5.14 Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at
any time insist upon, or plead or in any manner whatsoever, claim or take
the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, that may affect the covenants or the
performance of this Indenture; and the Issuer (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been
enacted.
SECTION 5.15 Action on Securitization Bonds. The
Trustee's right to seek and recover judgment on the Securitization Bonds or
under this Indenture shall not be affected by the seeking, obtaining or
application of any other relief under or with respect to this Indenture.
Neither the Lien of this Indenture nor any rights or remedies of the
Trustee or the Securitization Bondholders shall be impaired by the recovery
of any judgment by the Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Collateral or upon
any of the assets of the Issuer.
ARTICLE VI
The Trustee
SECTION 6.01 Duties and Liabilities of Trustee. (a) If an
Event of Default has occurred and is continuing, the Trustee shall exercise
the rights and powers vested in it by this Indenture and use the same
degree of care and skill in their exercise as a prudent Person would
exercise or use under the circumstances in the conduct of such Person's own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this
Indenture and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part,
the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein,
upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture but, in the case
of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the
Trustee shall examine the same to determine whether or not they
conform to the require ments of this Indenture.
(c) The Trustee may not be relieved from liability for
its own negligent action, its own negligent failure to act or its own
wilful misconduct, except that:
(i) this clause (c) does not limit the effect of
clause (b) of this Section 6.01;
(ii) the Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer
unless it is proved that the Trustee was negligent in ascertaining
the pertinent facts; and
(iii) the Trustee shall not be liable with
respect to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section
5.11.
(d) Every provision of this Indenture that in any way
relates to the Trustee is subject to clauses (a), (b) and (c) of this
Section 6.01.
(e) The Trustee shall not be liable for interest on any
money received by it except as provided in this Indenture or as the Trustee
may agree in writing with the Issuer.
(f) Money held in trust by the Trustee need not be
segregated from other funds held by the Trustee except to the extent
required by law or the terms of this Indenture, the Sale Agreement, the
Servicing Agreement or any Interest Rate Swap Agreement.
(g) No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds to believe that repayments of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
(h) Every provision of this Indenture relating to the
conduct or affecting the liability of or affording protection to the
Trustee shall be subject to the provisions of this Section 6.01 and to the
provisions of the TIA.
(i) Under no circumstances shall the Trustee be liable
for any indebtedness of the Issuer, the Servicer or the Seller evidenced by
or arising under the Securitization Bonds or any Basic Document.
SECTION 6.02 Rights of Trustee. (a) The Trustee may rely
on any document believed by it to be genuine and to have been signed or
presented by the proper Person. The Trustee need not investigate any fact
or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it
may require an Issuer Officer's Certificate or an Issuer Opinion of
Counsel. The Trustee shall not be liable for any action it takes or omits
to take in good faith in reliance on an Issuer Officer's Certificate or an
Issuer Opinion of Counsel.
(c) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Trustee shall not be
responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent attorney, custodian, or nominee appointed
with due care by it thereunder.
(d) The Trustee shall not be liable for any action it
takes or omits to take in good faith which it believes to be authorized or
within its rights or powers; provided, however, that the Trustee's conduct
does not constitute wilful misconduct, negligence or bad faith.
(e) The Trustee may consult with counsel, and the advice
or opinion of counsel with respect to legal matters relating to this
Indenture and the Securitization Bonds shall be full and complete
authorization and protection from liability in respect to any action taken,
omitted or suffered by it hereunder in good faith and in accordance with
the advice or opinion of such counsel.
SECTION 6.03 Individual Rights of Trustee. The Trustee in
its individual or any other capacity may become the owner or pledgee of
Securitization Bonds and may otherwise deal with the Issuer or its
affiliates with the same rights it would have if it were not Trustee. Any
Paying Agent, Securitization Bond Registrar, co-registrar or co-paying
agent, or agent appointed pursuant to Section 3.02(b) may do the same with
like rights. However, the Trustee must comply with Sections 6.11 and 6.12.
SECTION 6.04 Trustee's Disclaimer. The Trustee shall not
be responsible for and makes no representation as to the validity or
adequacy of this Indenture or the Securitization Bonds. The Trustee shall
not be accountable for the Issuer's use of the proceeds from the
Securitization Bonds, and the Trustee shall not be responsible for any
statement of the Issuer in this Indenture or in any document issued in
connection with the sale of the Securitization Bonds or in the
Securitization Bonds other than the Trustee's certificate of
authentication. The Trustee shall not be responsible for the form,
character, genuineness, sufficiency, value or validity of any of the
Collateral, or for or in respect of the validity or sufficiency of the
Securitization Bonds (other than the certificate of authentication for the
Securitization Bonds) or the Basic Documents and the Trustee shall in no
event assume or incur any liability, duty or obligation to any Holder of a
Securitization Bond, other than as expressly provided for in this
Indenture. The Trustee shall not be liable for the default or misconduct of
the Issuer, the Seller, the Servicer or the Member or any Manager of the
Issuer under any Basic Document or otherwise, or the default or misconduct
of any counterparty under any Interest Rate Swap Agreement, and the Trustee
shall have no obligation or liability to perform the obligations of the
Issuer.
SECTION 6.05 Notice of Defaults. If a Default occurs and
is continuing with respect to any Class or Series and if it is known to a
Responsible Officer of the Trustee, the Trustee shall mail to each Rating
Agency and to each Holder of Securitization Bonds of all Series notice of
the Default within thirty (30) days after it occurs. Except in the case of
a Default in payment of principal of or interest on any Securitization
Bond, the Trustee may withhold the notice if and so long as a committee of
its Responsible Officers in good faith determines that withholding the
notice is in the interests of Securitization Bondholders.
SECTION 6.06 Reports by Trustee to Holders. (a) The
Trustee shall deliver to each Holder of Securitization Bonds such
information as may be required to enable such Holder to prepare its federal
and state income tax returns.
(b) With respect to each Series of Securitization Bonds,
on or prior to each Payment Date therefor, the Trustee shall deliver a
statement prepared by the Trustee to each Holder of Securitization Bonds
which shall include (to the extent applicable) the following information
(and any other information so specified in the Series Supplement for such
Series) as to the Securitization Bonds of such Series with respect to such
Payment Date or the period since the previous Payment Date, as applicable:
(i) the amount paid to Holders of such
Securitization Bonds in respect of interest; such amount to be
expressed as a dollar amount per thousand;
(ii) the amount paid to Holders of such
Securitization Bonds in respect of principal; such amount to be
expressed as a dollar amount per thousand;
(iii) the Securitization Bond Balance, after
giving effect to the pay ments to be made on such Payment Date,
and the Projected Securitization Bond Balance, in each case for
such Series and as of such Payment Date;
(iv) the amount on deposit in the
Overcollateralization Subaccount for such Series and the Scheduled
Overcollateralization Level for such Series as of such Payment
Date;
(v) the amount on deposit in the Capital
Subaccount for such Series as of such Payment Date;
(vi) the amount, if any, on deposit in the
Reserve Subaccount as of such Payment Date;
(vii) the amount to be paid to any Swap
Counterparty, if any, (on a gross and a net basis, separately
stated) under any Interest Rate Swap Agreement on or before that
Payment Date;
(viii) the amounts paid to the Trustee since the
preceding Payment Date;
(ix) the amounts paid to the Servicer since the
preceding Payment Date; and
(x) the amount of any other transfers and
payments to be made on that Payment Date pursuant to the
Indenture.
(c) If any Securitization Bonds are listed on the
Luxembourg Stock Exchange and rules of such exchange so require, the
Trustee shall arrange for publication in an Authorized Newspaper that such
statement shall be available with the Issuer's listing agent in Luxembourg
appointed pursuant to Section 3.02(b).
(d) The Trustee's responsibility for disbursing the
information described in clause (b) above to Holders of Securitization
Bonds is limited to the availability, timeliness and accuracy of the
information provided by the Servicer pursuant to Section 3.05 and Annex 1
of the Servicing Agreement.
SECTION 6.07 Compensation and Indemnity. (a) The Issuer
shall pay to the Trustee from time to time reasonable compensation for its
services. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Issuer shall reimburse
the Trustee for all reasonable out-of-pocket expenses, disbursements and
advances incurred or made by it, including costs of collection, in addition
to the compensation for its services. Such expenses shall include the
reasonable compensation and expenses, disbursements and advances of the
Trustee's agents, counsel, accountants and experts. The Issuer shall
indemnify and hold harmless the Trustee from and against any and all costs,
damages, expenses, losses, liabilities or other amounts whatsoever
(including reasonable counsel fees) incurred by the Trustee in connection
with the administration of this trust, the enforcement of this trust and
all of the Trustee's rights, powers and duties under this Indenture and the
performance by the Trustee of the duties and obligations of the Trustee
under or pursuant to this Indenture. The Trustee shall notify the Issuer
promptly of any claim for which it may seek indemnity. Failure by the
Trustee to so notify the Issuer shall not relieve the Issuer of its
obligations hereunder.
(b) The Issuer shall defend the claim and the Trustee may
have separate counsel and the Issuer shall pay the reasonable fees and
expenses of such counsel. The Issuer need not reimburse any expense or
indemnify against any loss, liability or expense incurred by the Trustee
(i) through the Trustee's own wilful misconduct, negligence or bad faith or
(ii) to the extent the Trustee was reimbursed for or indemnified against
any such loss, liability or expense by the Seller pursuant to the Sale
Agreement or by the Servicer pursuant to the Servicing Agreement.
(c) When the Trustee incurs expenses after the occurrence
of a Default specified in Section 5.01(e) or 5.01(f) with respect to the
Issuer, the expenses are intended to constitute expenses of administration
under Title 11 of the United States Code or any other applicable federal or
state bankruptcy, insolvency or similar law.
SECTION 6.08 Replacement of Trustee. (a) The Trustee may
resign at any time upon thirty (30) days' prior written notice by so
notifying the Issuer. The Issuer may remove the Trustee with or without
cause at any time, with prior notice to the Rating Agencies, upon thirty
(30) days' prior written notice, and shall remove the Trustee if:
(i) the Trustee fails to comply with Section
6.11;
(ii) the Trustee is adjudged a bankrupt or
insolvent;
(iii) a receiver or other public officer takes
charge of the Trustee or its property; or
(iv) the Trustee otherwise becomes incapable of
acting.
(b) If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason (the Trustee in such event
being referred to herein as the "Retiring Trustee"), the Issuer shall
promptly appoint a successor Trustee.
(c) In addition, the Holders of a majority in Outstanding
Amount of the Securitization Bonds of all Series may remove the Trustee by
so notifying the Issuer and the Trustee and such Holders may appoint a
successor Trustee.
(d) A successor Trustee shall deliver a written
acceptance of its appointment to the Retiring Trustee and to the Issuer.
Thereupon the resignation or removal of the Retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers and
duties of the Trustee under this Indenture. No resignation or removal of
the Trustee shall become effective until the acceptance of the appointment
by a successor Trustee. Upon the date of such succession, the successor
Trustee shall mail a notice of its succession to Securitization Bond
holders. The Retiring Trustee shall promptly transfer all property held by
it as Trustee to the successor Trustee.
(e) If a successor Trustee does not take office within 60
days after the Retiring Trustee resigns or is removed, the Retiring
Trustee, the Issuer or the Holders of a majority in Outstanding Amount of
the Securitization Bonds of all Series may petition any court of compe tent
jurisdiction for the appointment of a successor Trustee.
(f) If the Trustee fails to comply with Section 6.11, any
Securitization Bondholder may petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a successor Trustee.
(g) Notwithstanding the replacement of the Trustee
pursuant to this Section 6.08, the Issuer's obligations under Section 6.07
shall continue for the benefit of the Retiring Trustee.
SECTION 6.09 Successor Trustee by Merger. (a) If the
Trustee consolidates with, merges or converts into, or transfers all or
substantially all its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation or banking association shall, without any further act, be the
successor Trustee. Notice of any such event shall be promptly given to each
Rating Agency by the successor Trustee and any agent in Luxembourg
appointed pursuant to Section 3.02(b).
(b) In case at the time such successor or successors by
merger, conversion, consolidation or transfer shall succeed to the trusts
created by this Indenture any of the Securiti zation Bonds shall have been
authenticated but not delivered, any such successor to the Trustee may
adopt the certificate of authentication of any Retiring Trustee, and
deliver such Securitiza tion Bonds so authenticated; and in case at that
time any of the Securitization Bonds shall not have been authenticated, any
successor to the Trustee may authenticate such Securitization Bonds either
in the name of any Retiring Trustee hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall
have the full force and effect granted by the Securitization Bonds or by
this Indenture and this force and effect shall be equal to any certificate
issued by the Trustee.
SECTION 6.10 Appointment of Co-Trustee or Separate
Trustee. (a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction
in which any part of the Collateral may at the time be located, the Trustee
shall have the power and may execute and deliver all instruments to appoint
one or more Persons to act as a co-trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Collateral, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Securitization Bondholders, such title to the Collateral, or any part
hereof, and, subject to the other provisions of this Section 6.10, such
powers, duties, obligations, rights and trusts as the Trustee may consider
necessary or desirable. No co-trustee or separate trustee hereunder shall
be required to meet the terms of eligibility as a successor trustee under
Section 6.11 and no notice to Securitization Bondholders of the appointment
of any co-trustee or separate trustee shall be required under Section 6.08.
Notice of any such appointment shall be promptly given to each Rating
Agency by the Trustee.
(b) Every separate trustee and co-trustee shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or
imposed upon and exercised or performed by the Trustee and such
separate trustee or co-trustee jointly (it being understood that
such separate trustee or co-trustee is not authorized to act
separately without the Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any
particular act or acts are to be performed the Trustee shall be
incompetent or unquali fied to perform such act or acts, in which
event such rights, powers, duties and obliga tions (including the
holding of title to the Collateral or any portion thereof in any
such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the
Trustee;
(ii) no trustee hereunder shall be personally
liable by reason of any act or omission of any other trustee
hereunder; and
(iii) the Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the
Trustee shall be deemed to have been given to each of the then separate
trustees and co-trustees, as effectively as if given to each of them. Every
instrument appointing any separate trustee or co-trustee shall refer to
this Indenture and the conditions of this Article VI. Each separate trustee
and co-trustee, upon its acceptance of the trusts conferred, shall be
vested with the estates or property specified in its instrument of
appointment, either jointly with the Trustee or separately, as may be
provided therein, subject to all the provisions of this Indenture,
specifically including every provision of this Indenture relating to the
conduct of, affecting the liability of, or affording protection to, the
Trustee. Every such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may at any time
constitute the Trustee, its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under
or in respect of this Agreement on its behalf and in its name. If any
separate trustee or co-trustee shall die, become incapable of acting,
resign or be removed, all of its estates, properties, rights, remedies and
trusts shall vest in and be exercised by the Trustee, to the extent
permitted by law, without the appointment of a new or successor trustee.
SECTION 6.11 Eligibility; Disqualification. The Trustee
shall at all times satisfy the requirements of TIA Section 310(a) and
Section 26(a)(i) of the Investment Company Act of 1940. The Trustee shall
have a combined capital and surplus of at least $50,000,000 as set forth in
its most recent published annual report of condition and it shall have a
long term debt rating of "BBB-" or better by Standard & Xxxx'x, "Xxx0" or
better by Moody's and "BBB-" or better by Fitch. The Trustee shall comply
with TIA Section 310(b), including the optional provision permitted by the
second sentence of TIA Section 310(b)(9); provided, however, that there
shall be excluded from the operation of TIA Section 310(b)(1) any indenture
or indentures under which other securities of the Issuer are outstanding if
the requirements for such exclusion set forth in TIA Section 310(b)(1) are
met.
SECTION 6.12 Preferential Collection of Claims Against
Issuer. The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the
extent indicated.
SECTION 6.13 Representations and Warranties of the
Trustee. The Trustee hereby represents and warrants that:
(a) the Trustee is a banking corporation validly existing
in good standing under the laws of the State of New York; and
(b) the Trustee has full power, authority and legal right
to execute, deliver and perform this Indenture and the Basic Documents to
which the Trustee is a party and has taken all necessary action to
authorize the execution, delivery and performance by it of this Indenture
and such Basic Documents.
ARTICLE VII
Securitization Bondholders' Lists and Reports
SECTION 7.01 Issuer To Furnish Trustee Names and
Addresses of Securiti zation Bondholders. The Issuer shall furnish or cause
to be furnished to the Trustee (a) not more than five days after the
earlier of (i) each Record Date with respect to each Series and (ii) three
months after the last Record Date with respect to each Series, a list, in
such form as the Trustee may reasonably require, of the names and addresses
of the Holders of Securitization Bonds of such Series as of such Record
Date, (b) at such other times as the Trustee may request in writing, within
thirty (30) days after receipt by the Issuer of any such request, a list of
similar form and content as of a date not more than ten days prior to the
time such list is furnished; provided, however, that so long as the Trustee
is the Securitization Bond Registrar, no such list shall be required to be
furnished. In addition, the Issuer shall furnish such list to any listing,
transfer or paying agent appointed under Section 3.02(b) to the extent such
information is required by the rules and regulations of the Luxembourg
Stock Exchange.
SECTION 7.02 Preservation of Information; Communications
to Securitiza tion Bondholders. (a) The Trustee shall preserve, in as
current a form as is reasonably practicable, the names and addresses of the
Holders of Securitization Bonds contained in the most recent list furnished
to the Trustee as provided in Section 7.01 and the names and addresses of
Holders of Securitization Bonds received by the Trustee in its capacity as
Securitization Bond Registrar. The Trustee may destroy any list furnished
to it as provided in such Section 7.01 upon receipt of a new list so
furnished.
(b) Securitization Bondholders may communicate with other
Securitization Bondholders pursuant to Section 312(b) of the TIA, with
respect to their rights under this Indenture or under the Securitization
Bonds.
(c) The Issuer, the Trustee and the Securitization Bond
Registrar shall have the protection of Section 312(c) of the TIA.
SECTION 7.03 Reports by Issuer. (a) The Issuer shall:
(i) file with the Trustee and, so long as any
Securitization Bonds are listed on the Luxembourg Stock Exchange
and its rules so require, with the listing agent of the Issuer in
Luxembourg appointed pursuant to Section 3.02(b), within fifteen
(15) days after the Issuer is required to file the same with the
Commission, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by rules and
regulations prescribe) which the Issuer may be required to file
with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act;
(ii) file with the Trustee, the Commission and,
so long as any Securiti zation Bonds are listed on the Luxembourg
Stock Exchange, the listing agent in Luxem xxxxx appointed
pursuant to Section 3.02(b), in accordance with rules and
regulations prescribed from time to time by the Commission or the
Luxembourg Stock Exchange, respectively, such additional
information, documents and reports with respect to compli ance by
the Issuer with the conditions and covenants of this Indenture as
may be required from time to time by such rules and regulations;
and
(iii) supply to the Trustee (and the Trustee
shall transmit by mail to all Securitization Bondholders described
in TIA Section 313(c)) and, so long as any Securiti zation Bonds
are listed on the Luxembourg Stock Exchange and its rules so
require, to the listing agent of the Issuer in Luxembourg
appointed pursuant to Section 3.02(b), such summaries of any
information, documents and reports required to be filed by the
Issuer pursuant to clauses (i) and (ii) of this Section 7.03(a) as
may be required by rules and regulations prescribed from time to
time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal
year of the Issuer shall end on December 31 of each year.
SECTION 7.04 Reports by Trustee. (a) If required by TIA
Section 313(a), within 60 days after the end of each fiscal year of the
Issuer, commencing with the year after the issuance of the Securitization
Bonds of any Series, the Trustee shall mail to each Holder of
Securitization Bonds of such Series as required by TIA Section 313(c) a
brief report dated as of such date that complies with TIA Section 313(a).
The Trustee also shall comply with TIA Section 313(b); provided, however,
that the initial report so issued shall be delivered not more than twelve
(12) months after the initial issuance of each Series.
(b) A copy of each report at the time of its mailing to
Securitization Bond holders shall be filed by the Trustee with the
Commission and each stock exchange, if any, on which the Securitization
Bonds are listed (to the extent required by the rules of such exchange).
The Issuer shall notify the Trustee if and when the Securitization Bonds
are listed on any stock exchange.
SECTION 7.05 Provision of Servicer Reports. Upon the
written request of any Securitization Bondholder to the Trustee addressed
to the Corporate Trust Office, the Trustee shall provide such
Securitization Bondholder with a copy of the Issuer Officer's Certificate
referred to in Section 3.05 of the Servicing Agreement and the Annual
Accountant's Report referred to in Section 3.06 of the Servicing Agreement.
If any Securitization Bonds are listed on the Luxembourg Stock Exchange and
rules of such exchange so require, the Trustee shall also arrange for
publication in an Authorized Newspaper that a copy of such Issuer Officer's
Certifi cate and such Annual Accountant's Report shall be available with
the Issuer's listing agent in Luxembourg appointed pursuant to Section
3.02(b).
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.01 Collection of Money. Except as otherwise
expressly provided herein, the Trustee may demand payment or delivery of,
and shall receive and collect, directly and without intervention or
assistance of any fiscal agent or other intermediary, all money and other
property payable to or receivable by the Trustee pursuant to this
Indenture. The Trustee shall apply all such money received by it as
provided in this Indenture. Except as otherwise expressly provided in this
Indenture, if any default occurs in the making of any payment or
performance under any agreement or instrument that is part of the
Collateral, the Trustee may take such action as may be appropriate to
enforce such payment or performance, including the institution and
prosecution of appropriate Proceedings. Any such action shall be without
prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.
SECTION 8.02 Collection Account. (a)(i) On or prior to
the Series Issuance Date for the first Series issued hereunder, the Issuer
shall open, at the Trustee's Corporate Trust Office, or at another Eligible
Institution, one or more segregated trust accounts in the Trustee's name
for the benefit of the Holders (collectively, the "Collection Account").
The Collection Account shall initially be divided into subaccounts, which
need not be separate bank accounts: a general subaccount (the "General
Subaccount"), an overcollateralization subaccount for each Series of
Securitization Bonds (each, an "Overcollateralization Subaccount" or the
"Series Overcollateralization Subaccount"), a capital subaccount for each
Series of Securitization Bonds (each, a "Capital Subaccount" or the "Series
Capital Subaccount"), a capital reserve subaccount (the "Capital Reserve
Subaccount"), a reserve subaccount (the "Reserve Subaccount"), a series
subaccount for each Series of Securitization Bonds (each, a "Series
Subaccount") and a class subaccount for any Class of any Series of
Securitization Bonds which has a floating rate of interest as specified in
any Series Supplement (each, a "Class Subaccount"). On or prior to the
Series Issuance Date for each Series issued after the Series Issuance Date
for the first Series issued hereunder, the Issuer shall establish an
additional Series Subaccount therefor and a Class Subaccount for any Class
of such Series which has a floating rate of interest and in respect of
which the Issuer has entered into an Interest Rate Swap Agreement, as
Subaccounts of the Collection Account. Prior to depositing funds or U.S.
Government Obligations in the Collection Account pursuant to Sections 4.01
or 4.02, the Issuer shall establish defeasance subaccounts (each, a
"Defeasance Subaccount") for each Series for which funds shall be
deposited, as subaccounts of the Collection Account. All amounts in the
Collection Account not allocated to any other Subaccount shall be allocated
to the General Subaccount. Prior to the initial Payment Date, all amounts
in the Collection Account (other than funds deposited into the Capital
Subaccount, up to the Required Capital Amount) shall be allocated to the
General Subaccount. All payments received by the Trustee from any Swap
Counterparty at any time shall be deposited in the related Class
Subaccount. All references to the Collection Account shall be deemed to
include reference to all subaccounts contained therein. Withdrawals from
and deposits to each of the foregoing subaccounts of the Collection Account
shall be made as set forth in Sections 4.01, 4.02, 4.03 and 8.02(d) through
(n). The Collection Account shall at all times be maintained in an Eligible
Securities Account and only the Trustee shall have access to the Collection
Account for the purpose of making deposits in and withdrawals from the
Collection Account in accordance with this Indenture. Funds in the
Collection Account shall not be commingled by the Issuer with any other
moneys, and shall not be commingled by the Trustee. All moneys deposited
from time to time in the Collection Account, all deposits therein pursuant
to this Indenture, and all investments made in Eligible Investments with
such moneys, including all income or other gain from such investments,
shall be held by the Trustee in the Collection Account as part of the
Collateral as herein provided, with the exception of any amount up to
$100,000 held at any time in the Capital Reserve Subaccount. The Capital
Reserve Subaccount shall be funded with $100,000 from amounts contributed
to the Capital Subaccount for the initial Series of Securitiza tion Bonds.
Amounts on deposit in the Capital Reserve Subaccount shall be available,
upon request of the Issuer, to pay any expenses of the Issuer.
(ii) Notwithstanding any other provision of this
Indenture, the Collection Account shall be a securities account
and shall be established only with a securities intermediary (as
defined in Section 8-102(1)(m) of the Michigan UCC) that agrees
with the Trustee that (A) the Collection Account shall be a
securities account of the Trustee, (B) all property credited to
the Collection Account shall be treated as a financial asset, (C)
such securities intermediary shall treat the Trustee as entitled
to exercise the rights that comprise each financial asset credited
to the Collection Account, (D) such securities intermediary shall
comply with entitlement orders originated by the Trustee without
the further consent of any other person or entity, (E) such
securities intermediary shall not agree with any person other than
the Trustee to comply with entitlement orders originated by such
other person, (F) the Collection Account and all property credited
to it shall not be subject to any Lien or right of set-off in
favor of such securities intermediary or anyone claiming through
it (other than the Trustee), and (G) such agreement shall be
governed by the laws of the State of Michigan. The Collection
Account shall be under the control (within the meaning of Section
8-106 of the Michigan UCC) of the Trustee. If at any time the
Collection Account ceases to be an Eligible Securities Account,
the Trustee shall, within ten (10) days, establish a new
Collection Account as an Eligible Securities Account.
(b) All or a portion of the funds in the Collection
Account shall be invested in Eligible Investments and reinvested by the
Trustee upon Issuer Order; provided, however, that no funds in the
Defeasance Subaccount for any Series of Securitization Bonds shall be
invested in Eligible Investments or otherwise, except that U.S. Government
Obligations deposited by the Issuer with the Trustee pursuant to Sections
4.01 or 4.02 shall remain as such. Except as provided in Section
8.02(g)(x), all income or other gain from investments of moneys deposited
in the Collection Account shall be deposited by the Trustee in the
Collection Account, and any loss resulting from such investments shall be
charged to the Collection Account. The Issuer shall not direct the Trustee
to make any investment of any funds or to sell any investment held in the
Collection Account unless the security interest granted and perfected in
such account will continue to be perfected in such investment or the
proceeds of such sale, in either case without any further action by any
Person, and, in connection with any direction to the Trustee to make any
such investment or sale, if requested by the Trustee, the Issuer shall
deliver to the Trustee an Issuer Opinion of Counsel, acceptable to the
Trustee, to such effect. Subject to Section 6.01(c), the Trustee shall not
in any way be held liable for the selection of Eligible Investments or for
investment losses incurred thereon except for losses attributable to the
Trustee's failure to make payments on such Eligible Investments issued by
the Trustee, in its commercial capacity as principal obligor and not as
Trustee, in accordance with their terms. The Trustee shall have no
liability in respect of losses incurred as a result of the liquidation of
any Eligible Investment prior to its stated maturity or the failure of the
Issuer to provide timely written investment direction. The Trustee shall
have no obligation to invest or reinvest any amounts held hereunder in the
absence of written investment direction pursuant to an Issuer Order;
provided, however, that if (i) the Issuer shall have failed to give
investment directions for any funds on deposit in the Collec tion Account
to the Trustee by 11:00 a.m. (prevailing New York City time) (or such other
time as may be agreed by the Issuer and Trustee) on any Business Day, or
(ii) a Default or Event of Default shall have occurred and be continuing
but the Securitization Bonds shall not have been declared due and payable
pursuant to Section 5.02, then the Trustee shall, to the fullest extent
practicable, invest and reinvest funds in the Collection Account in one or
more Eligible Invest ments of the kind described in clause (e) of the
definition thereof.
(c) Any Securitization Charge Collections remitted by the
Servicer to the Trustee, any Indemnity Amounts remitted to the Trustee by
the Seller or the Servicer or other wise received by the Trustee or the
Issuer, any other proceeds of Collateral received by the Servicer, the
Issuer or the Trustee, and any amounts paid by any counterparty under any
Interest Rate Swap Agreement received by the Servicer, the Issuer or the
Trustee, shall be deposited in the General Subaccount.
(d) Monthly, on the 20th day of each month, or if such
day is not a Business Day, the preceding Business Day, beginning December
20, 2001, the fee owed to the Trustee in an amount equal to $[ ] for such
month, plus any expenses, including legal fees and expenses, Indemnity
Amounts (up to a maximum of $10,000,000 in the aggregate for the then
current and all prior Payment Dates and for all Series, provided that the
payment of such amounts does not result in an Event of Default, unless the
Issuer has received confirmation from S&P and Fitch that a further amount
will not result in a reduction or a withdrawal of the then current rating
of the outstanding Securitization Bonds).
(e) After the distribution made pursuant to clause (d)
above, monthly, on the 20th day of each month, or if such day is not a
Business Day, the preceding Business Day, beginning December 20, 2001, the
Monthly Servicing Fee and any unpaid Monthly Servicing Fees shall, at the
direction of the Servicer, be paid to the Servicer.
(f) On each Payment Date, or such other date related to
such Payment Date as may be specified in the related Series Supplement, the
Trustee, at the direction of the Servicer, shall allocate to each Class
Subaccount from the related Series Subaccount the amounts specified in the
related Series Supplement. Such amounts shall be so allocated after taking
into account all allocations required in connection with such Payment Date
under clauses (d) and (e) above and (g)(i) through (iii) below; provided
that in the event of any shortfall of amounts to be allocated pursuant to
clause (g)(iii) among more than one Class of the applicable Series, amounts
shall be allocated to such Class Subaccount on a Pro Rata basis with all
other Classes of the relevant Series. Amounts in each Class Subaccount
shall be applied as provided in the related Series Supplement.
(g) Except as otherwise provided in any Series Supplement
with respect to any floating rate Class, on each Payment Date, by 12:00
noon (prevailing New York City time), or if such day is not a Business Day,
on the following Business Day, the Trustee shall, at the direction of the
Servicer, apply all amounts on deposit in the General Subaccount of the
Collection Account and any investment earnings on the subaccounts in the
Collection Account, after distribution in accordance with clauses (d) and
(e) above, and, subject to the qualifications therein, after allocation to
any Class Subaccount and payment to any related Swap Counterparty in
accordance with clause (f) above, in the following priority:
(i) the administration fee payable under the
Administration Agree ment, as specified in the related Series
Supplement, shall be paid to the Administrator; and fees payable
to the Independent Managers in an amount equal to $[ ] for such
Payment Date, shall be paid to the Independent Managers;
(ii) so long as no Event of Default has occurred
and is continuing or would be caused by such payment, all
Operating Expenses other than distributions in accordance with
clauses (d), (e) and (g)(i) above shall be paid to the Persons
entitled thereto, provided that the amount paid on such Payment
Date pursuant to this clause (g)(ii) may not exceed $100,000 in
the aggregate for all Series;
(iii) an amount equal to Interest payable on
each Class of each Series of Securitization Bonds on such Payment
Date shall be allocated on a Pro Rata basis to the corresponding
Series Subaccount, which, to the extent provided in any Series
Supplement with respect to interest on any floating rate Class,
shall be an amount equal to the applicable amount specified in the
related Series Supplement payable with respect to that Class and
which will be allocated Pro Rata to the corresponding Class
Subaccount;
(iv) an amount equal to any Principal of each
Class of each Series of Securitization Bonds payable as a result
of acceleration pursuant to Section 5.02, any Principal of any
Series or Class of Securitization Bonds payable on the Final
Maturity Date of such Series or Class, and any Principal of a
Series or Class of Securitization Bonds payable on the Redemption
Date for such Series or Class shall be allocated on a Pro Rata
basis to the corresponding Series Subaccount;
(v) an amount equal to Principal scheduled to be
paid on each Class of each Series of Securitization Bonds on such
Payment Date according to the Expected Amortization Schedule,
excluding any amounts provided for pursuant to clause (g)(iv)
above, shall be allocated on a Pro Rata basis to the corresponding
Series Subaccount;
(vi) all remaining unpaid Operating Expenses and
Indemnity Amounts (excluding those paid pursuant to clause (d)
above) and any termination or similar non-recurring payments under
any Interest Rate Swap Agreement shall be paid to the Persons
entitled thereto;
(vii) any amount necessary to replenish any
shortfalls in the Capital Subaccount for each Series below the
Required Capital Amount for such Series shall be allocated to the
Capital Subaccount for such Series, Pro Rata, based on the
Outstanding principal balance of each Series;
(viii) an amount shall be allocated to the
Overcollateralization Subaccount for each Series sufficient to
cause the amount in the Overcollateralization Subaccount for such
Series to equal the Scheduled Overcollateralization Level for such
Series as of that Payment Date, Pro Rata, based on the Outstanding
principal balance of each Series;
(ix) so long as no Event of Default has occurred
and is continuing, an amount equal to investment earnings on
amounts in the Capital Subaccount shall be released to the Issuer;
(x) the balance, if any, shall be allocated to
the Reserve Subaccount; and
(xi) following repayment of all outstanding
Series of Securitization Bonds, the balance, if any, shall be
released to the Issuer free from the Lien of this Indenture.
(h) For purposes of allocations among Series prior to an
acceleration of the Securitization Bonds pursuant to Section 5.02, except
as otherwise provided in any Series Supplement, "Pro Rata" means with
respect to any Series a ratio, (i) in the case of a payment of Interest on
any Payment Date, the numerator of which is the amount of Interest payable
on such Series on such Payment Date which shall include, with respect to
any Class of such Series of floating rate Securitization Bonds, the Gross
Fixed Amount for that Class (as such term is defined by the related Series
Supplement) on such Payment Date and the denominator of which is the
aggregate amount of Interest payable on all Series on such Payment Date;
(ii) in the case of a payment of Principal on any Payment Date, the
numerator of which is the aggregate amount of Principal scheduled to be
paid or payable, as the case may be, on such Payment Date with respect to
such Series and the denominator of which is the sum of the aggregate
amounts of Principal scheduled to be paid or payable, as the case may be,
with respect to all Outstanding Series on such Payment Date; and (iii) in
the case of a payment or allocation on any Payment Date other than of
Interest or Principal, the numerator of which is the Outstanding principal
amount of such Series immediately prior such Payment Date and the
denominator of which is the aggregate Outstanding principal amount of all
Series immediately prior such Payment Date.
(i) If, on any Payment Date, funds on deposit in the
General Subaccount are insufficient to make the payments and allocations
contemplated by subclauses (d), (e), (f) and (g)(i) through (viii) above
for all Series, the Trustee shall, at the direction of the Servicer, draw
from amounts on deposit in the following subaccounts in the following order
up to the amount of such shortfall, in order to make such payments and
allocations:
(i) from the Reserve Subaccount for all
Series, Pro Rata, for payments and allocations
contemplated by subclauses (d), (e), (f) and (g)(i)
through (v), (vii) and (viii),
(ii) from the Overcollateralization
Subaccount for such Series, Pro Rata, for payments and
allocations contemplated by subclauses (d), (e), (f) and
(g)(i) through (v), and
(iii) from the Capital Subaccount for
such Series, Pro Rata, for payments and allocations
contemplated by subclauses (d), (e), (f) and (g)(i)
through (v);
provided that no amounts from the Reserve Subaccount, the
Overcollateralization Subaccount for such Series or the Capital Subaccount
for such Series shall by allocated to any Class Subaccount pursuant to
subclause (g)(iii) to the extent a shortfall in amounts available to pay
interest due on the related Class of Securitization Bonds is due solely to
any failure by a Swap Counterparty to make payments due under the related
Interest Rate Swap Agreement.
(j) On each Payment Date for any Series prior to an
acceleration of the Securitization Bonds pursuant to Section 5.02, the
amounts on deposit in the Series Subaccount shall be allocated, at the
direction of the Servicer, in the following order of priority: (i) to pay
Interest due and payable on the Securitization Bonds of such Series with
respect to such Payment Date to the Holders of Securitization Bonds of such
Series, and (ii) the balance, if any, up to the amount of Principal
scheduled to be paid or payable on the Securitization Bonds of such Series
on such Payment Date, to pay such Principal to the Holders of
Securitization Bonds of such Series.
(k) Prior to an acceleration of the Securitization Bonds
pursuant to Section 5.02, all allocations of Principal and Interest with
respect to any Series comprised of two or more Classes shall be allocated
among the Classes within such Series on a Pro Rata basis.
(l) For purposes of allocations among Classes within a
single Series prior to an acceleration of the Securitization Bonds pursuant
to Section 5.02, except as otherwise provided in any Series Supplement,
"Pro Rata" means with respect to any Class a ratio, (i) in the case of a
payment of Interest with respect to any Payment Date, the numerator of
which is the amount of interest payable to such Class on such Payment Date,
or in the case of any Class of floating rate Securitization Bonds, the
Gross Fixed Amount for that Class (as such term is defined by the related
Series Supplement) on such Payment Date, and the denominator of which is
the aggregate amount of Interest payable on all Classes within such Series
on such Payment Date; and (ii) in the case of a payment of Principal on any
Payment Date, the numerator of which is the aggregate amount of Principal
scheduled to be paid or payable, as the case may be, on such Payment Date
with respect to such Class and the denominator of which is the sum of the
aggregate amounts of Principal scheduled to be paid or payable, as the case
may be, with respect to all Outstanding Classes within such Series on such
Payment Date.
(m) Prior to an acceleration of the Securitization Bonds
pursuant to Section 5.02, all payments of Principal and Interest to Holders
of Securitization Bonds of a single Class, or of a single Series without
Classes, shall be made on a proportionate basis based on the respective
principal amounts of such Securitization Bonds held by such Holders.
(n) Upon an acceleration of the maturity of the
Securitization Bonds pursuant to Section 5.02, the aggregate amount of
principal of and interest accrued on each Securitization Bond shall be
payable, without priority of interest over principal or of principal over
interest and without regard to Series or Class, in the proportion that the
aggregate amount of principal of and interest accrued on such
Securitization Bond bears to the aggregate amount of principal of and
interest accrued on all Securitization Bonds.
(o) Notwithstanding any other provision in this Indenture
to the contrary, in the event of an acceleration of the Securitization
Bonds and a subsequent liquidation of the Collateral in accordance with
Section 5.04(a), if so provided in any Interest Rate Swap Agree ment, the
proceeds of such liquidation allocated to the related Class of floating
rate Securitization Bonds in accordance with this Section 8.03 shall be
deposited in the related Class Subaccount and allocated between and paid to
the Holders of such floating rate Class, on the one hand, and the related
Swap Counterparty, on the other hand, pro rata based on the aggregate
amount of principal and interest due and payable on such floating rate
Class and the aggregate amount payable to the related Swap Counterparty in
accordance with such Interest Rate Swap Agree ment.
SECTION 8.03 Release of Collateral. (a) All money and
other property withdrawn from the Collection Account by the Trustee for
payment to the Issuer as provided in this Indenture in accordance with
Section 8.02 shall be deemed released from this Indenture when so withdrawn
and applied in accordance with the provisions of Article VIII, without
further notice to, or release or consent by, the Trustee.
(b) Other than as provided for in clause (a) above, the
Trustee shall release property from the Lien of this Indenture only as and
to the extent permitted by the Basic Documents and only upon receipt of an
Issuer Request accompanied by an Issuer Officer's Certificate, an Issuer
Opinion of Counsel and Independent Certificates in accordance with TIA
Sections 314(c) and 314(d)(1) meeting the applicable requirements of
Section 11.01 or an Issuer Opinion of Counsel in lieu of such Independent
Certificates to the effect that the TIA does not require any such
Independent Certificate.
(c) Subject to the payment of its fees and expenses
pursuant to Section 6.07, the Trustee may, and when required by the
provisions of this Indenture shall, execute instruments to release property
from the Lien of this Indenture, or convey the Trustee's interest in the
same, in a manner and under circumstances that are not inconsistent with
the provisions of this Indenture. No party relying upon an instrument
executed by the Trustee as provided in this Article VIII shall be bound to
ascertain the Trustee's authority, inquire into the satisfaction of any
conditions precedent or see to the application of any moneys.
(d) Subject to Section 8.03(b), the Trustee shall, at
such time as there are no Securitization Bonds Outstanding and all sums due
the Trustee pursuant to Section 6.07 have been paid, release any remaining
portion of the Collateral that secured the Securitization Bonds from the
Lien of this Indenture and release to the Issuer or any other Person
entitled thereto any funds or investments then on deposit in or credited to
the Collection Account.
SECTION 8.04 Issuer Opinion of Counsel. The Trustee shall
receive at least five days notice when requested by the Issuer to take any
action pursuant to Section 8.03, accompanied by copies of any instruments
involved, and the Trustee shall also require, as a condition to such
action, an Issuer Opinion of Counsel, in form and substance satisfactory to
the Trustee, stating the legal effect of any such action, outlining the
steps required to complete the same, and concluding that all conditions
precedent to the taking of such action have been complied with and such
action will not materially and adversely impair the security for the
Securitization Bonds or the rights of the Securitization Bondholders in
contravention of the provisions of this Indenture; provided, however, that
such Issuer Opinion of Counsel shall not be required to express an opinion
as to the fair value of the Collateral. Counsel rendering any such opinion
may rely, without independent investigation, on the accuracy and validity
of any certificate or other instrument delivered to the Trustee in
connection with any such action.
SECTION 8.05 Reports by Independent Accountants. The
Issuer shall appoint a firm of Independent certified public accountants of
recognized national reputation for purposes of preparing and delivering the
reports or certificates of such accountants required by this Indenture and
the related Series Supplements. Upon any resignation by such firm, the
Issuer shall promptly appoint a successor thereto that shall also be a firm
of Independent certified public accountants of recognized national
reputation. If the Issuer shall fail to appoint a successor to a firm of
Independent certified public accountants that has resigned within 30 days
after such resignation, the Trustee shall promptly notify the Issuer of
such failure in writing. If the Issuer shall not have appointed a successor
within ten (10) days thereafter, the Trustee shall promptly appoint a
successor firm of Independent certified public accountants of recognized
national reputation. The fees of such firm of Independent certified public
accountants and its successor shall be payable by the Issuer.
ARTICLE IX
Supplemental Indentures
SECTION 9.01 Supplemental Indentures Without Consent of
Securitization Bondholders. (a) Without the consent of the Holders of any
Securitization Bonds or the counterparty under any Interest Rate Swap
Agreement but with prior notice to the Rating Agencies, the Issuer and the
Trustee, when authorized by an Issuer Order, at any time and from time to
time, may enter into one or more indentures supplemental hereto (which
shall conform to the provisions of the Trust Indenture Act as in force at
the date of the execution thereof), in form satisfactory to the Trustee,
for any of the following purposes:
(i) to correct or amplify the description of the
Collateral, or better to assure, convey and confirm unto the
Trustee the Collateral, or to subject to the Lien of this
Indenture additional property;
(ii) to evidence the succession, in compliance
with the applicable provisions hereof, of another Person to the
Issuer, and the assumption by any applicable successor of the
covenants of the Issuer contained herein and in the Securitization
Bonds;
(iii) to add to the covenants of the Issuer, for
the benefit of the Securiti zation Bondholders, or to surrender
any right or power herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or
pledge any property to the Trustee;
(v) to cure any ambiguity, to correct or
supplement any provision herein or in any Supplemental Indenture
which may be inconsistent with any other provision herein or in
any Supplemental Indenture or to make any other provisions with
respect to matters or questions arising under this Indenture or in
any Supplemental Indenture consistent with other provisions of the
Basic Documents or less ambiguous; provided, however, that (i)
such action shall not, as evidenced by an Issuer Opinion of
Counsel, adversely affect in any material respect the interests of
any Securitization Bondholder or any counterparty under any
Interest Rate Swap Agreement and (ii) the Rating Agency Condition
shall have been satisfied with respect thereto;
(vi) to evidence and provide for the acceptance
of the appointment hereunder by a successor Trustee with respect
to the Securitization Bonds and to add to or change any of the
provisions of this Indenture as shall be necessary to facilitate
the administration of the trusts hereunder by more than one
Trustee, pursuant to the require ments of Article VI;
(vii) to modify, eliminate or add to the
provisions of this Indenture to such extent as shall be necessary
to effect the qualification of this Indenture under the TIA or
under any similar federal statute hereafter enacted and to add to
this Indenture such other provisions as may be expressly required
by the TIA;
(viii) to set forth the terms of any Series that
has not theretofore been authorized by a Supplemental Indenture,
provided that the Rating Agency Condition has been satisfied;
(ix) to provide for any Interest Rate Swap
Agreements with respect to any Series or Class of Securitization
Bonds which bears a floating rate of interest or any Series or
Class with specified credit enhancement; provided, however, that:
(A) such action shall not, as evidenced
by an Opinion of Counsel, adversely affect in any
material respect the interests of any Securitization
Bondholder or any counterparty under any Interest Rate
Swap Agreement and
(B) the Rating Agency Condition shall
have been satisfied with respect thereto; or
(x) to authorize the appointment of any listing
agent, transfer agent or paying agent or additional registrar for
any Class of any Series of Securitization Bonds required or
advisable in connection with the listing of any Class or any
Series of Securiti zation Bonds on the Luxembourg Stock Exchange
or any other stock exchange, and otherwise to amend this Indenture
to incorporate any changes requested or required by any
governmental authority, stock exchange authority, listing agent,
transfer agent or paying agent or additional registrar for any
Class of any Series of Securitization Bonds in connection with
that listing.
(b) The Trustee is hereby authorized to join in the
execution of any such Supplemental Indenture and to make any further
appropriate agreements and stipulations that may be therein contained.
SECTION 9.02 Supplemental Indentures with Consent of
Securitization Bondholders. (a) The Issuer and the Trustee, when authorized
by an Issuer Order, also may, upon satisfaction of the Rating Agency
Condition (in each case, accompanied by the form of the proposed
supplemental indenture) and with the consent of the Holders of not less
than a majority of the Outstanding Amount of the Securitization Bonds of
each Series or Class to be affected, by Act of such Holders delivered to
the Issuer and the Trustee, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of, this
Indenture or of modifying in any manner the rights of the Holders of the
Securitization Bonds under this Indenture; provided, however, that no such
Supplemental Indenture shall, without the consent of the Holder of each
Outstanding Securitiza tion Bond of each Series or Class and each
counterparty under any Interest Rate Swap affected thereby:
(i) a change the date of payment of any
instalment of principal of or interest on any Securitization Bond,
or reduce the principal amount thereof, the interest rate thereon
or the redemption price with respect thereto, change the
provisions of any Interest Rate Swap Agreement relating to the
amount, calculation or timing of payments, change the provisions
of this Indenture and the related applicable Supplemental
Indenture or Series Supplement relating to the application of
collections on, or the proceeds of the sale of, the Collateral to
payment of principal of or interest on the Securitization Bonds,
or change the currency in which, any Securitization Bond or the
interest thereon is payable;
(ii) impair the right to institute suit for the
enforcement of the provi sions of this Indenture requiring the
application of funds available therefor, as provided in Article V,
to the payment of any such amount due on the Securitization Bonds
on or after the respective due dates thereof (or, in the case of
redemption, on or after the Redemption Date);
(iii) reduce the percentage of the Outstanding
Amount of the Securiti zation Bonds or of a Series or Class
thereof, the consent of the Holders of which is required for any
such Supplemental Indenture, or the consent of the Holders of
which is required for any waiver of compliance with provisions of
this Indenture or defaults hereunder and their consequences
provided for in this Indenture or modify or alter the provisions
of the proviso to the definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding
Amount of the Securiti zation Bonds required to direct the Trustee
to direct the Issuer to sell or liquidate the Collateral pursuant
to Section 5.04 or to preserve the Collateral pursuant to Section
5.05;
(v) reduce the percentage of the Outstanding
Amount of a Series or Class of Securitization Bonds, the consent
of the Holders of which is required for any amendments to the Sale
Agreement, the Administration Agreement, the Servicing Agreement
or any Interest Rate Swap Agreement;
(vi) modify any of the provisions of this
Indenture in such manner so as to affect the amount of any payment
of interest or principal payable on any Securitization Bond on any
Payment Date or change the Redemption Dates, Expected Amortization
Schedules or Final Maturity Date of any Series or Class of
Securitization Bonds, or the method of calculation of interest on
any floating rate Securitization Bonds;
(vii) decrease the Overcollateralization Amount
or Required Capital Amount with respect to any Series or the
Scheduled Overcollateralization Level with respect to any Payment
Date;
(viii) modify or alter the provisions of this
Indenture regarding the voting of Securitization Bonds held by the
Issuer, the Seller, an Affiliate of either of them or any obligor
on the Securitization Bonds;
(ix) decrease the percentage of the aggregate
principal amount of Securitization Bonds required to amend the
sections of this Indenture which specify the applicable percentage
of the aggregate principal amount of the Securitization Bonds
necessary to amend this Indenture or any other Basic Document; or
(x) permit the creation of any Lien ranking
prior to or on a parity with the Lien of this Indenture with
respect to any part of the Collateral or, except as otherwise
permitted or contemplated herein, terminate the Lien of this
Indenture on any property at any time subject hereto or deprive
the Holder of any Securitization Bond of the security provided by
the Lien of this Indenture.
(b) It shall not be necessary for any Act of
Securitization Bondholders under this Section 9.02 to approve the
particular form of any proposed Supplemental Indenture, but it shall be
sufficient if such Act shall approve the substance thereof.
(c) Promptly after the execution by the Issuer and the
Trustee of any Supple mental Indenture pursuant to this Section 9.02, the
Trustee shall mail to the Holders of the Securitization Bonds to which such
amendment or Supplemental Indenture relates a notice setting forth in
general terms the substance of such Supplemental Indenture. Any failure of
the Trustee to mail such notice, or any defect therein, shall not, however,
in any way impair or affect the validity of any such Supplemental
Indenture. If any Securitization Bonds are listed on the Luxembourg Stock
Exchange and the rules of such exchange so require, the Trustee shall
arrange for publication an Authorized Newspaper that such notice shall be
available with the Issuer's listing agent in Luxembourg appointed pursuant
to Section 3.02(b).
SECTION 9.03 Execution of Supplemental Indentures. In
executing, or permitting the additional trusts created by, any Supplemental
Indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive,
and subject to Sections 6.01 and 6.02, shall be fully protected in relying
upon, an Issuer Opinion of Counsel stating that the execution of such
Supplemental Indenture is authorized or permitted by this Indenture. The
Trustee may, but shall not be obligated to, enter into any such
Supplemental Indenture that affects the Trustee's own rights, duties,
liabilities or immunities under this Indenture or otherwise.
SECTION 9.04 Effect of Supplemental Indenture. Upon the
execution of any Supplemental Indenture pursuant to the provisions hereof,
this Indenture shall be and be deemed to be modified and amended in
accordance therewith with respect to each Series or Class of Securitization
Bonds affected thereby, and the respective rights, limitations of rights,
obligations, duties, liabilities and immunities under this Indenture of the
Trustee, the Issuer, the Holders of the Securitization Bonds and any
counterparty under any Interest Rate Swap Agreement shall thereafter be
determined, exercised and enforced hereunder subject in all respects to
such modifications and amendments, and all the terms and conditions of any
such Supplemental Indenture shall be and be deemed to be part of the terms
and conditions of this Indenture for any and all purposes.
SECTION 9.05 Conformity with Trust Indenture Act. Every
amendment of this Indenture and every Supplemental Indenture executed
pursuant to this Article IX shall conform to the requirements of the TIA as
then in effect so long as this Indenture shall then be qualified under the
TIA.
SECTION 9.06 Reference in Securitization Bonds to
Supplemental Inden tures. Securitization Bonds authenticated and delivered
after the execution of any Supplemental Indenture pursuant to this Article
IX may, and if required by the Trustee shall, bear a notation in form
approved by the Trustee as to any matter provided for in such Supplemental
Indenture. If the Issuer or the Trustee shall so determine, new
Securitization Bonds so modified as to conform, in the opinion of the
Trustee and the Issuer, to any such Supplemental Indenture may be prepared
and executed by the Issuer and authenticated and delivered by the Trustee
in exchange for Outstanding Securitization Bonds.
ARTICLE X
Redemption of Securitization Bonds
SECTION 10.01 Optional Redemption by Issuer. If so
provided in the related Series Supplement and provided that there is no
Interest Rate Swap Agreement with respect to any Class of that Series in
effect, the Issuer may, at its option, redeem all, but not less than all,
of the Securitization Bonds of a Series on any Payment Date if, after
giving effect to payments that would otherwise be made on such Payment
Date, the Outstanding Amount of any such Series of Securitization Bonds has
been reduced to less than five percent (5%) of the initial principal
balance of such Series. The redemption price in any case shall be equal to
the outstanding principal amount of the Bonds to be redeemed plus accrued
and unpaid interest thereon at the Interest Rate to the Redemption Date
(the "Redemption Price"). If the Issuer elects to redeem the Securitization
Bonds of a Series pursuant to this Section 10.01, it shall furnish notice
of such election to (a) the Trustee, not later than twenty-five (25) days
prior to the Redemption Date for such redemption and (b) to the Rating
Agencies, not later than ten (10) days prior to such Redemption Date,
whereupon all such Securitization Bonds shall be due and payable on such
Redemption Date upon the furnishing of a notice complying with Section
10.03 to each Holder of the Securitization Bonds of such Series pursuant to
this Section 10.01.
SECTION 10.02 Mandatory Redemption by Issuer. The Issuer
shall redeem the Securitization Bonds of a Series on the Redemption Date or
Dates, if any, in the amounts required, if any, and at the redemption price
specified in the Series Supplement for such Series, which in any case shall
be not less than the outstanding principal amount of the Bonds to be
redeemed, plus accrued interest thereon to such Redemption Date. If the
Issuer is required to redeem the Securitization Bonds of a Series pursuant
to this Section 10.02, it shall furnish notice of such requirement to the
Trustee not later than twenty-five (25) days prior to the Redemption Date
for such redemption whereupon all such Securitization Bonds shall be due
and payable on the Redemption Date upon the furnishing of a notice
complying with Section 10.03 to each Holder of the Securitization Bonds of
such Series pursuant to this Section 10.02.
SECTION 10.03 Form of Redemption Notice. (a) Unless
otherwise specified in the Series Supplement relating to a Series of
Securitization Bonds, notice of redemption under Sections 10.01 or 10.02
shall be given by the Trustee by first-class mail, postage prepaid, mailed
not less than five days nor more than forty-five (45) days prior to the
applicable Redemption Date to each Holder of Securitization Bonds to be
redeemed, as of the close of business on the Record Date preceding the
applicable Redemption Date at such Holder's address appearing in the
Securitization Bond Register.
(b) All notices of redemption shall state:
(i) the Redemption Date;
(ii) the amount of such Securitization Bonds to
be redeemed;
(iii) the Redemption Price; and
(iv) the place where such Securitization Bonds
are to be surrendered for payment of the Redemption Price
and accrued interest (which shall be the office or agency
of the Issuer to be maintained as provided in Section
3.02).
(c) Notice of redemption of the Securitization Bonds to
be redeemed shall be given by the Trustee in the name and at the expense of
the Issuer. For so long as any Securitiza tion Bonds are listed on the
Luxembourg Stock Exchange and the rules of such exchange so require, the
Trustee shall arrange that such notice will also be given by publication in
an Authorized Newspaper at least ten (10) days prior to the Redemption
Date. Failure to give notice of redemption, or any defect therein, to any
Holder of any Securitization Bond selected for redemption shall not impair
or affect the validity of the redemption of any other Securitization Bond.
Notice of optional redemption shall be irrevocable once given.
SECTION 10.04 Payment of Redemption Price. If notice of
redemption has been duly mailed or duly waived by the Holders of all
Securitization Bonds called for redemp tion, then the Securitization Bonds
called for redemption shall be payable on the applicable Redemption Date at
the applicable Redemption Price. No further interest will accrue on the
principal amount of any Securitization Bonds called for redemption after
the Redemption Date, and the Holders of such Securitization Bonds will have
no rights with respect thereto, if payment of the Redemption Price has been
duly provided for on or before the Redemption Date declared therefor.
Notwithstanding the foregoing, the Holders of the Securitization Bonds
shall be entitled to payment of interest on the Redemption Price accrued at
the related Interest Rates to the extent the Issuer fails to pay the
Redemption Price on the Redemption Date declared therefor. Payment of the
Redemption Price shall be made by the Trustee to or upon the order of the
Holders of the Securitization Bonds called for redemption upon surrender of
such Securitization Bonds, and the Securitization Bonds so redeemed shall
cease to be of further effect and the Lien hereunder shall be released with
respect to such Securitization Bonds.
ARTICLE XI
Miscellaneous
SECTION 11.01 Compliance Certificates and Opinions, etc.
(a) Upon any application or request by the Issuer to the Trustee to take
any action under any provision of this Indenture, the Issuer shall furnish
to the Trustee (i) an Issuer Officer's Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to
the proposed action have been complied with, (ii) an Issuer Opinion of
Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with and (iii) (if required by the
TIA) an Independent Certificate from a firm of certified public accountants
meeting the applicable requirements of this Section 11.01, except that, in
the case of any such application or request as to which the furnishing of
such documents is specifically required by any provision of this Indenture,
no additional certificate or opinion need be furnished.
(b) Every certificate or opinion with respect to
compliance with a condition or covenant provided for in this Indenture
shall include:
(i) a statement that each signatory of such
certificate or opinion has read or has caused to be read
such covenant or condition and the definitions herein
relating thereto;
(ii) a brief statement as to the nature and
scope of the examination or investigation upon which the
statements or opinions contained in such certificate or
opinion are based;
(iii) a statement that, in the opinion of each
such signatory, such signatory has made such examination
or investigation as is necessary to enable such signatory
to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion
of each such signatory, such condition or covenant has
been complied with.
SECTION 11.02 Form of Documents Delivered to Trustee. (a)
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one
such Person, or that they be so certified or covered by only one document,
but one such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters, and any
such Person may certify or give an opinion as to such matters in one or
several documents.
(b) Any certificate or opinion of an Authorized Officer
of the Issuer may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such
officer knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the matters upon
which his certificate or opinion is based are erroneous. Any such
certificate of an Authorized Officer or Issuer Opinion of Counsel may be
based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Servicer,
the Seller or the Issuer, stating that the information with respect to such
factual matters is in the possession of the Servicer, the Seller or the
Issuer, unless such Authorized Officer or counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
(c) Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates, statements,
opinions or other instruments under this Indenture, they may, but need not,
be consolidated and form one instrument.
(d) Whenever in this Indenture, in connection with any
application or certificate or report to the Trustee, it is provided that
the Issuer shall deliver any document as a condition of the granting of
such application, or as evidence of the Issuer's compliance with any term
hereof, it is intended that the truth and accuracy, at the time of the
granting of such application or at the effective date of such certificate
or report (as the case may be), of the facts and opinions stated in such
document shall in such case be conditions precedent to the right of the
Issuer to have such application granted or to the sufficiency of such
certificate or report. The foregoing shall not, however, be construed to
affect the Trustee's right to rely upon the truth and accuracy of any
statement or opinion contained in any such document as provided in Article
VI.
SECTION 11.03 Acts of Securitization Bondholders. (a) Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by Securitization
Bondholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Securitization Bond holders in
person or by agents duly appointed in writing; and except as herein
otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the Trustee, and, where it is
hereby expressly required, to the Issuer. Such instru ment or instruments
(and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Securitization Bondholders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 6.01) conclusive
in favor of the Trustee and the Issuer, if made in the manner provided in
this Section 11.03.
(b) The fact and date of the execution by any person of
any such instrument or writing may be proved in any manner that the Trustee
deems sufficient.
(c) The ownership of Securitization Bonds shall be proved
by the Securitiza tion Bond Register.
(d) Any request, demand, authorization, direction,
notice, consent, waiver or other action by the Holder of any Securitization
Bonds shall bind the Holder of every Securitiza tion Bond issued upon the
registration thereof or in exchange therefor or in lieu thereof, in respect
of anything done, omitted or suffered to be done by the Trustee or the
Issuer in reliance thereon, whether or not notation of such action is made
upon such Securitization Bond.
SECTION 11.04 Notices, etc., to Trustee, Issuer and
Rating Agencies. (a) Any request, demand, authorization, direction, notice,
consent, waiver or Act of Securitization Bondholders or other documents
provided or permitted by this Indenture to be made upon, given or furnished
to or filed with:
(i) the Trustee by any Securitization Bondholder or by
the Issuer, or
(ii) the Issuer by the Trustee or by any Securitization
Bondholder,
shall be sufficient for every purpose hereunder if in English and in
writing, and sent by United States first-class mail, reputable overnight
courier service, facsimile transmission or electronic mail (confirmed by
telephone, United States first-class mail or reputable overnight courier
service in the case of notice by facsimile transmission or electronic mail)
or any other customary means of communication, and any such request,
demand, authorization, direction, notice, consent, waiver or Act shall be
effective when delivered or transmitted, or if mailed, five days after
deposit in the United States first-class mail with proper postage for
first-class mail prepaid, in the case of the Trustee, addressed to the
Trustee at its Corporate Trust Office, and in the case of the Issuer,
addressed to: Consumers Funding LLC, 000 X. Xxxxxxxx Xxxxxx, Xxxxx X-0000,
Xxxxxxx, Xxxxxxxx 00000, Attention: Managers, or at any other address
previously furnished in writing to the Trustee by the Issuer. The Issuer
shall promptly transmit any notice received by it from the Securitization
Bondholders to the Trustee.
(b) Notices required to be given to the Rating Agencies
by the Issuer, the Trustee or a Manager shall be in writing, delivered
personally, via facsimile transmission, by reputable overnight courier or
by first-class mail, postage prepaid, to: (i) in the case of Moody's:
Xxxxx'x Investors Service, Inc., Attention: ABS Monitoring Department, 00
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; (ii) in the case of Standard &
Poor's: Standard & Poor's Corporation, 00 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Asset Backed Surveillance Department and (iii) in the case of
Fitch: Fitch, Inc., 0 Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: ABS Surveillance.
SECTION 11.05 Notices to Securitization Bondholders;
Waiver. (a) Where this Indenture provides for notice to Securitization
Bondholders of any event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and delivered by
first-class mail, postage prepaid, to each Securitization Bondholder
affected by such event, at the address of such Securitization Bondholder as
it appears on the Securitization Bond Register, not later than the latest
date, and not earlier than the earliest date, prescribed for the giving of
such notice. In any case where notice to Securitization Bondholders is
given by mail, neither the failure to mail such notice nor any defect in
any notice so mailed to any particular Securitization Bondholder shall
affect the sufficiency of such notice with respect to other Securitization
Bondholders, and any notice that is mailed in the manner herein provided
shall conclusively be presumed to have been duly given.
(b) Where this Indenture provides for notice in any
manner, such notice may be waived in writing by any Person entitled to
receive such notice, either before or after the event, and such waiver
shall be the equivalent of such notice. Waivers of notice by Securitiza
tion Bondholders shall be filed with the Trustee but such filing shall not
be a condition precedent to the validity of any action taken in reliance
upon such a waiver.
(c) In case it shall be impractical to deliver notice in
accordance with clause (a) of this Section 11.05 to the Holders of
Securitization Bonds when such notice is required to be given pursuant to
any provision of this Indenture, then any manner of giving such notice as
shall be satisfactory to the Trustee shall be deemed to be a sufficient
giving of such notice.
(d) Where this Indenture provides for notice to the
Rating Agencies, failure to give such notice shall not affect any other
rights or obligations created hereunder, and shall not under any
circumstance constitute a Default or Event of Default.
SECTION 11.06 Notices to Luxembourg Stock Exchange. (a)
For so long as any Securitization Bonds are listed on the Luxembourg Stock
Exchange and to the extent the rules of such exchange so require, the
Issuer shall notify the Luxembourg Stock Exchange and any agent appointed
pursuant to Section 3.02(b) if any rating assigned to such Securitization
Bonds is reduced or withdrawn and shall arrange for such notice to be
published in an Autho rized Newspaper.
(b) For so long as any Securitization Bonds are listed on
the Luxembourg Stock Exchange and the rules of such exchange so require,
the Trustee shall make available to the Holders of such Securitization
Bonds and shall deposit on file with the Issuer's listing agent in
Luxembourg appointed pursuant to Section 3.02(b), copies of the Basic
Documents, all reports provided to Securitization Bondholders pursuant to
this Indenture, the prospectus related to such Securitization Bonds, the
reports of independent certified public accountants obtained with respect
to the Issuer pursuant to this Indenture, the financial information
regarding Consumers in its annual report on Form 10-K for the fiscal year
ended December 31, 2000 and copies of each annual report of Consumers on
Form 10-K for subsequent fiscal years. The Trustee shall deposit with the
Chief Registrar of the District Court of Luxembourg prior to listing on the
Luxembourg Stock Exchange a copy of the Issuer Certificate of Formation,
the Issuer LLC Agreement and any legal notices relating to the issuance of
such Securitization Bonds.
SECTION 11.07 Alternate Payment and Notice Provisions.
Notwithstanding any provision of this Indenture or any of the
Securitization Bonds to the contrary, the Issuer may enter into any
agreement with any Holder of a Securitization Bond providing for a method
of payment, or notice by the Trustee or any Paying Agent to such Holder,
that is different from the methods provided for in this Indenture for such
payments or notices. The Issuer will furnish to the Trustee a copy of each
such agreement and the Trustee will cause payments to be made and notices
to be given in accordance with such agreements.
SECTION 11.08 Conflict with Trust Indenture Act. (a) If
any provision hereof limits, qualifies or conflicts with another provision
hereof that is required to be included in this Indenture by any of the
provisions of the TIA, such required provision shall control.
(b) The provisions of TIA Sections 310 through 317 that
impose duties on any Person (including the provisions automatically deemed
included herein unless expressly excluded by this Indenture) are a part of
and govern this Indenture, whether or not physically contained herein.
SECTION 11.09 Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 11.10 Successors and Assigns. (a) All covenants
and agreements in this Indenture and the Securitization Bonds by the Issuer
shall bind its successors and permitted assigns, whether so expressed or
not.
(b) All agreements of the Trustee in this Indenture shall
bind its successors.
(c) The Trustee shall provide prior notice to the Rating
Agencies of any assignment of the obligations under this Agreement.
SECTION 11.11 Severability. In case any provision in this
Indenture or in the Securitization Bonds shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 11.12 Benefits of Indenture. Nothing in this
Indenture or in the Securitization Bonds, express or implied, shall give to
any Person, other than the parties hereto and their successors hereunder,
and the Securitization Bondholders, and any other party secured hereunder,
and any other Person with an ownership interest in any part of the
Collateral, any benefit or any legal or equitable right, remedy or claim
under this Indenture.
SECTION 11.13 Legal Holidays. In any case where the date
on which any payment is due shall not be a Business Day, then
(notwithstanding any other provision of the Securitization Bonds or this
Indenture) payment need not be made on such date, but may be made
on the next succeeding Business Day with the same force and effect as if
made on the date on which nominally due, and no interest shall accrue for
the period from and after any such nominal date.
SECTION 11.14 GOVERNING LAW. THIS INDENTURE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
MICHIGAN, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVI SIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUN DER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.15 Counterparts. This Indenture may be
executed in any number of counterparts, each of which so executed shall be
deemed to be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 11.16 Issuer Obligation. No recourse may be
taken, directly or indirectly, with respect to the obligations of the
Issuer or the Trustee on the Securitization Bonds or under this Indenture
or any certificate or other writing delivered in connection herewith or
therewith, against (i) the Member or any Manager, employee or agent of the
Issuer or (ii) any stockholder, officer, director, employee or agent of the
Trustee (it being understood that none of the Trustee's obligations are in
its individual capacity).
SECTION 11.17 No Petition. The Trustee, by entering into
this Indenture, and each Securitization Bondholder, by accepting a
Securitization Bond, hereby covenants and agrees (or shall be deemed to
have covenanted and agreed) that it shall not at any time institute against
the Issuer, or join in the institution against the Issuer of, or acquiesce,
petition or otherwise invoke or cause the Issuer to invoke the process of
any court or government authority for the purpose of commencing or
sustaining a case against the Issuer under any Federal or State bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Issuer or
any substantial part of the property of the Issuer or ordering the winding
up or liquidation of the affairs of the Issuer.
SECTION 11.18 Intercreditor Agreement. The Trustee is
hereby authorized, at the request of the Issuer, to execute and deliver
additional intercreditor agreements pursuant to Section 18 of the Initial
Intercreditor Agreement subject only to the satisfaction of the Rating
Agency Condition and the Opinion of Counsel referenced in the Initial
Intercreditor Agreement. Each Intercreditor Agreement shall be binding on
the Securitization Bondholders.
IN WITNESS WHEREOF, the Issuer and the Trustee have
caused this Indenture to be duly executed and delivered by a Manager and an
officer, respectively, thereof, each thereunto duly authorized, all as of
the day and year first above written.
CONSUMERS FUNDING LLC,
as Issuer
By:__________________________
Name:
Title: Manager
THE BANK OF NEW YORK,
as Trustee
By:__________________________
Name:
Title:
APPENDIX A
MASTER DEFINITIONS
The definitions contained in this Appendix A are applicable to the singular
as well as the plural forms of such terms.
Act has the meaning specified in Section 11.03(a) of the
Indenture.
Adjustment Date means (a) the first day of the first billing cycle
of the Servicer in December of each year through December 2013 and
(b) thereafter, as long as the Securiti zation Bonds are
outstanding, the first day of the first billing cycle of the
Servicer in March, June, September and December of each year,
beginning with the billing cycle for December 2014.
Adjustment Request means an application filed by the Servicer with
the MPSC for a Securitization Charge Adjustment pursuant to
Section 4(b) of the Issuer Annex.
Administration Agreement means the Administration Agreement dated
as of [________], between Consumers, as administrator, and the
Issuer, as the same may be amended or supplemented from time to
time.
Administrator means Consumers, as administrator under the
Administration Agreement, and each successor to Consumers, in the
same capacity, pursuant to Section 14 of the Administration
Agreement.
Affiliate means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with
such specified Person. For the purposes of this definition,
control when used with respect to any specified Person means the
power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms controlling
and controlled have meanings correlative to the foregoing.
Alternative Electric Suppliers means any third party, including
any electric generation supplier, providing billing or metering
services, licensed by the MPSC pursuant to relevant provisions of
the Customer Choice Act, the MPSC Regulations and the Financ ing
Order.
Annual Accountant's Report has the meaning assigned to that term
in Section 3.07 of the Servicing Agreement.
Authorized Denominations means, with respect to any Series or
Class of Securitization Bonds, $1,000 and integral multiples of
$1.00 above that amount, provided, however, that one bond of each
Class may have denomination of less than $1,000, or such other
denominations as may be specified in the Series Supplement
therefor.
Authorized Newspaper means the Luxemburger Wort or any other
newspaper published in Luxembourg on a daily basis.
Authorized Officer means, with respect to the Issuer, (A) any
Manager and, (B) any person designated as an "Officer" under the
Issuer LLC Agreement and authorized thereby to act on behalf of
the Issuer.
Basic Documents means the Formation Documents, the Sale Agreement,
any Intercreditor Agreement, any Bills of Sale, the Servicing
Agreement, the Administration Agreement, the Indenture, the
Underwriting Agreement, the Securities Account Control Agreement
and any Interest Rate Swap Agreement, as each may be amended or
supplemented from time to time.
Xxxx of Sale means any xxxx of sale issued by the Seller to the
Issuer pursuant to the Sale Agreement evidencing the sale of
Securitization Property by the Seller to the Issuer.
Billing Month means the schedule for current month xxxxxxxx (each
billing month includes 21 billing segments regardless of the
number of days in the current calendar month). For uniformity of
customer xxxxxxxx each customer's meter is read every 27 to 33
days and billed in one of the 21 monthly billing segments.
Book-Entry Securitization Bonds means beneficial interests in the
Securitization Bonds, ownership and transfers of which shall be
made through book entries by a Clearing Agency as described in
Section 2.11 of the Indenture.
Business Day means any day other than a Saturday or Sunday or a
day on which banking institutions in the City of Jackson,
Michigan, or in the City of New York, New York [or, with respect
to any Securitization Bonds listed on the Luxembourg Stock
Exchange, in Luxembourg,] are required or authorized by law or
executive order to remain closed.
Calculation Date means the day which is at least 45 days before
each Adjustment Date on which the Servicer files an Adjustment
Request.
Capital Reserve Subaccount has the meaning specified in Section
8.02(a) of the Inden ture.
Capital Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Class means, with respect to any Series, any one of the classes of
Securitization Bonds of that Series, as specified in the Series
Supplement for that Series.
Class Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Clearing Agency means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
Clearing Agency Participant means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of
securities deposited with the Clearing Agency.
Code means the Internal Revenue Code of 1986, as amended from time
to time, and the treasury regulations promulgated thereunder.
Collateral has the meaning specified in the Granting Clause of the
Indenture.
Collection Account has the meaning specified in Section 8.02(a) of
the Indenture.
Collection Curve means, with respect to a Billing Month, the
forecast prepared by the Servicer of the percentages of amounts
billed in a Billing Month that are expected to be received during
each of the Billing Months for which the Collection Curve Ratio
will be applied to determine the amount of Securitization Charges
collected.
Collection Curve Percentage means a forecast of the percentages of
amounts billed in a particular month that are expected to be
received during that month:
Current Billing Month's Collections: 40.08%
First Prior Billing Month's Collections: 45.09%
Second Prior Billing Month's Collections: 14.84%
Commission means the U.S. Securities and Exchange Commission, and
any successor thereof.
Consumers means Consumers Energy Company, a Michigan corporation.
Corporate Trust Office means the principal office of the Trustee
at which at any particu lar time its corporate trust business
shall be administered, which office at date of the execution of
this Indenture is located at 0 Xxxx Xxxxx-00xx xxxxx, Xxx Xxxx,
Xxx Xxxx 00000-0000, Attention: Corporate Trust-Asset Backed
Securities (ABS), or at such other address as the Trustee may
designate from time to time by notice to the Securitization
Bondholders and the Issuer, or the principal corporate trust
office of any successor Trustee (the address of which the
successor Trustee will notify the Securitization Bondholders and
the Issuer in writing).
Covenant Defeasance Option has the meaning specified in Section
4.01(b) of the Indenture.
Customers means all electric customers taking delivery of
electricity from Consumers or its successor on its MPSC-approved
rate schedules and special contracts.
Customer Choice Act means the Customer Choice and Electricity
Reliability Act as set forth in Michigan Public Acts 2000 PA 141
and 2000 PA 142 and effective on June 5, 2000.
Daily Remittance Date means, if the Servicer has not satisfied the
conditions of Section 5.11(b) of the Servicing Agreement, each
Business Day commencing on the second Business Day following the
date on which the Servicer begins remit tance procedures under
Section 3.03(a)(ii) of the Servicing Agreement.
Default means any occurrence that is, or with notice or the lapse
of time or both would become, an Event of Default.
Defeasance Subaccount has the meaning specified in Section 8.02(a)
of the Indenture.
Definitive Securitization Bonds has the meaning specified in
Section 2.11 of the Inden ture.
Delaware UCC means the Uniform Commercial Code, as in effect in
the State of Delaware, as amended from time to time.
DTC Agreement means the agreement between the Issuer, the Trustee
and The Depository Trust Company, as the initial Clearing Agency,
dated on or about [_________], relating to the Securitization
Bonds, as the same may be amended or supplemented from time to
time.
Eligible Guarantor Institution means a firm or other entity
identified in Rule 17Ad-15 under the Exchange Act as "an eligible
guarantor institution," including (as such terms are defined
therein):
(a) a bank;
(b) a broker, dealer, municipal securities broker or
dealer or government securities broker or dealer;
(c) a credit union;
(d) a national securities exchange, registered
securities association or clearing agency; or
(e) a savings association that is a participant in a
securities transfer association.
Eligible Institution means:
(a) the corporate trust department of the Trustee,
so long as any of the securi ties of the Trustee
have a credit rating from each Rating Agency in
one of its generic rating categories which
signifies investment grade, or
(b) a depositary institution organized under the laws
of the United States of America or any State (or
any domestic branch of a foreign bank), which
(i) has either
(A) with respect to any Eligible
Investment having a maturity of
greater than one month, a
long-term unsecured debt rating
of "AA-" by Standard & Poor's
and Fitch and "Aa3" by Moody's,
or
(B) with respect to any Eligible
Investment having a maturity
one month or less, a
certificate of deposit rating
of "A-1+" by Standard & Poor's
and "P-1" by Moody's, or any
other long-term, short-term or
certificate of deposit rating
accept able to the Rating
Agencies, and
(ii) whose deposits are insured by the FDIC.
Eligible Investments mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or
registered form which evidence:
(a) direct obligations of, and obligations fully and
unconditionally guaranteed as to timely payment
by, the United States of America;
(b) demand deposits, time deposits or certificates
of deposit of any depository institution or
trust company (any depositary institution or
trust company being referred to in this
definition as a "financial institution")
incorporated under the laws of the United States
of America or any State thereof (or any domestic
branch of a foreign bank) and subject to
supervision and exami nation by Federal or State
banking or depositary institution authorities;
provided, however, that at the time of the
investment or contractual commitment to invest
therein, the commercial paper or other
short-term unsecured debt obligations (other
than such obligations the rating of which is
based on the credit of a Person other than such
depositary institution or trust company) thereof
shall have a credit rating from each of the
Rating Agencies in the highest investment
category granted thereby;
(c) commercial paper or other short term obligations
of any corporation organized under the laws of
the United States of America (other than
Consumers) whose ratings, at the time of the
investment or contractual commitment to invest
therein, from each of the Rating Agencies are in
the highest investment category granted thereby;
(d) demand deposits, time deposits and certificates
of deposit which are fully insured by the
Federal Deposit Insurance Corporation;
(e) investments in money market funds having a
rating from each of the Rating Agencies in the
highest investment category granted thereby
(including funds for which the Trustee or any of
its Affiliates act as investment manager or
advisor);
(f) bankers' acceptances issued by any depositary
institution or trust company referred to in
clause (b) above;
(g) repurchase obligations with respect to any
security that is a direct obliga tion of, or
fully guaranteed by, the United States of
America or any agency or instrumentality thereof
the obligations of which are backed by the full
faith and credit of the United States of
America, in either case entered into with a
depositary institution or trust company (acting
as principal) de scribed in clause (b) above;
(h) repurchase obligations with respect to any
security or whole loan entered into with
(i) a financial institution (acting as
principal) described in clause (b)
above,
(ii) a broker/dealer (acting as principal)
registered as a broker or dealer under
Section 15 of the Exchange Act (any
broker/dealer being referred to in this
definition as a "broker/dealer"), the
unsecured short-term debt obligations
of which are rated P-1 by Moody's and
A-1+ by Standard & Poor's at the time
of entering into this repur chase
obligation, or
(iii) an unrated broker/dealer, acting as
principal, that is a wholly-owned
subsidiary of a non-bank or bank
holding company the unsecured
short-term debt obligations of which
are rated P-1 by Moody's and A-1+ by
Standard & Poor's at the time of
purchase; or
(i) any other investment permitted by each Rating Agency;
provided, however, that, with respect to Moody's only, the obligor
related to clauses (b), (c), (d), (f), (g) and (h) above must have
both a long term rating of at least A1 and a short term rating of
at least P-1, and provided further, that, unless otherwise
permitted by each Rating Agency, upon the failure of any Eligible
Institution to maintain any applicable rating set forth in this
definition or the definition of Eligible Institution, the related
investments at such institution shall be reinvested in Eligible
Investments at a successor Eligible Institution within 10 days,
and provided, further, that, any Eligible Investment must not:
(a) be sold, liquidated or otherwise disposed of at
a loss, prior to the maturity thereof, or
(b) mature later than (i) the date on which the
proceeds of such Eligible Investment will be
required to be on deposit in the Collection
Account in order for the Trustee to make all
required and scheduled payments and deposits
into Subaccounts under the Indenture, if such
Eligible Investment is held by an Affiliate of
the Trustee, or (ii) the Business Day prior to
the date on which the proceeds of such Eligible
Investment will be required to be on deposit in
the Collection Account in order for the Trustee
to make all required and scheduled payments and
deposits into Subaccounts under the Indenture,
if such Eligible Investment is not held by an
Affiliate of the Trustee.
Eligible Securities Account means either:
(a) a segregated trust account with an Eligible
Institution or
(b) a segregated trust account with the corporate
trust department of a deposi tary institution
organized under the laws of the United States of
America or any State (or any domestic branch of
a foreign bank), having corporate trust powers
and acting as trustee for funds deposited in
such account, so long as any of the securities
of such depositary institution shall have a
credit rating from each Rating Agency in one of
its generic rating catego xxxx which signifies
investment grade.
Event of Default has the meaning specified in Section 5.01 of the
Indenture.
Exchange Act means the Securities Exchange Act of 1934, as
amended.
Expected Amortization Schedule means, with respect to each Series
or, if applicable, each Class of Securitization Bonds, the
expected amortization schedule for principal thereof, as specified
in the Series Supplement therefor.
Expected Final Payment Date means, with respect to each Series or,
if applicable, each Class of Securitization Bonds, the date when
all interest and principal is scheduled to be paid with respect to
that Series or Class in accordance with the Expected Amortization
Schedule, as specified in the Series Supplement therefor.
Final Maturity Date means, for each Series or, if applicable, each
Class of Securitization Bonds, the date by which all principal of
and interest on such Series or Class of Securiti zation Bonds is
required to be paid, as specified in the Series Supplement
therefor.
Financing Issuance means an issuance of a new Series of
Securitization Bonds under the Indenture to provide funds to
finance the purchase by the Issuer of Securitization Property.
Financing Order means the Opinion and Order issued on October 24,
2000 and the Order Granting Rehearing issued on January 12, 2001
by the MPSC (MPSC Docket Number U-12505) with respect to
Consumers.
Fitch means Fitch, Inc., or its successor.
Formation Documents means, collectively, the Issuer LLC Agreement,
the Issuer Certificate of Formation and any other document
pursuant to which the Issuer is formed or governed, as each may be
amended or supplemented from time to time.
General Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Grant means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, and xxxxx x
xxxx upon and a security interest in and right of set-off against,
deposit, set over and confirm. A Grant of the Collateral or of any
other agree ment or instrument shall include all rights, powers
and options (but none of the obliga tions) of the Granting party
thereunder, including the immediate and continuing right to claim
for, collect, receive and give receipt for principal, interest and
other payments in respect of the Collateral and all other moneys
payable thereunder, to give and receive notices and other
communications, to make waivers or other agreements, to exercise
all rights and options, to bring Proceedings in the name of the
Granting party or otherwise and generally to do and receive
anything that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.
Holder or Securitization Bondholder means the Person in whose name
a Securitization Bond of any Series or Class is registered in the
Securitization Bond Register.
Indemnified Person has the meaning specified in Section 5.02 of
the Servicing Agree ment.
Indemnity Amount means the amount of any indemnification
obligation payable under the Basic Documents.
Indenture means the Indenture dated as of [______], 2001 between
the Issuer and the Trustee, as the same may be amended and
supplemented from time to time by one or more Supplemental
Indentures, and shall include each Series Supplement and the forms
and terms of the Securitization Bonds established thereunder.
Independent means, when used with respect to any specified Person,
that the Person
(a) is in fact independent of the Issuer, any other
obligor upon the Securitiza tion Bonds,
Consumers, the Servicer (if different from
Consumers) and any Affiliate of any of the
foregoing Persons,
(b) does not have any direct financial interest or
any material indirect financial interest in the
Issuer, any such other obligor, Consumers or any
Affiliate of any of the foregoing Persons, and
(c) is not connected with the Issuer, any such other
obligor, Consumers or any Affiliate of any of
the foregoing Persons as an officer, employee,
pro moter, underwriter, trustee, partner,
director or person performing similar functions.
Independent Certificate means a certificate or opinion to be
delivered to the Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section
11.01 of the Indenture, made by an Independent appraiser or other
expert appointed by an Issuer Order and approved by the Trustee in
the exercise of reasonable care, and such opinion or certificate
shall state that the signer has read the definition of
"Independent" in this Appendix A and that the signer is
Independent within the meaning thereof.
Independent Manager has the meaning set forth in the Issuer LLC
Agreement.
Initial Purchase Price has the meaning set forth in Section
2.01(a) of the Sale Agreement.
Initial Transfer Date means the Series Issuance Date for the first
Series of Securitization Bonds.
Initial Transferred Securitization Property means the
Securitization Property sold by the Seller to the Issuer as of the
Initial Transfer Date pursuant to the Sale Agreement and the Xxxx
of Sale delivered on or prior to the Initial Transfer Date as
identified in such Xxxx of Sale.
Insolvency Event means, with respect to a specified Person,
(a) the filing of a decree or order for relief by a
court having jurisdiction in the premises in
respect of such Person or any substantial part
of its property in an involuntary case under any
applicable Federal or State bankruptcy,
insolvency or other similar law now or hereafter
in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator or
similar official for such Person or for any
substantial part of its property, or ordering
the winding-up or liquidation of such Person's
affairs, and such decree or order shall remain
unstayed and in effect for a period of 90
consecutive days or
(b) the commencement by such Person of a voluntary
case under any applica ble Federal or State
bankruptcy, insolvency or other similar law now
or hereafter in effect, or the consent by such
Person to the entry of an order for relief in an
involuntary case under any such law, or the
consent by such Person to the appointment of or
taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or
similar official for such Person or for any
substantial part of its property, or the making
by such Person of any general assignment for the
benefit of creditors, or the failure by such
Person generally to pay its debts as such debts
become due, or the taking of action by such
Person in furtherance of any of the foregoing.
Intercreditor Agreement means: (i) the Intercreditor Agreement
dated as of November , 2001 (the "Initial Intercreditor
Agreement"), among Consumers, the Trustee, the Issuer, Canadian
Imperial Bank of Commerce and Asset Securitization Cooperative
Corporation, as amended and supplemented from time to time; or
(ii) any subsequent intercreditor agreement entered into by the
Trustee pursuant to Section 18(b) of the Initial Intercreditor
Agreement
Interest means, for any Payment Date for any Series or Class of
Securitization Bonds, the sum, without duplication, of:
(a) an amount equal to the amount of interest
accrued at the applicable Interest Rate from the
prior Payment Date with respect to that Series
or Class;
(b) any unpaid interest, plus any interest accrued
on this unpaid inter est at the applicable
Interest Rate, to the extent permitted by appli
cable law;
(c) if the Securitization Bonds have been declared
due and payable, all accrued and unpaid interest
thereon; and
(d) with respect to a Series or Class to be redeemed
prior to the next Payment Date, the amount of
interest that will be payable as inter est on
such Series or Class upon such redemption.
Interest Rate means, with respect to each Series or Class of
Securitization Bonds, the rate at which interest accrues on the
principal balance of Securitization Bonds of such Series or Class,
as specified in the Series Supplement therefor.
Interest Rate Swap Agreement means any interest rate swap
agreement entered into by the Issuer with respect to any Series or
Class of Securitization Bonds, including, without limitation, the
ISDA Master Agreement and the related Schedule and Confirmation
between the Issuer and a Swap Counterparty, as same may be amended
or supplemented from time to time.
Issuer means Consumers Funding LLC, a Delaware limited liability
company, or its successor under the Indenture or the party named
as such in the Indenture until a succes sor replaces it and,
thereafter, means the successor.
Issuer Annex means Annex 1 of the Servicing Agreement.
Issuer Certificate of Formation means the Amended and Restated
Certificate of Forma tion of the Issuer which was filed with the
Delaware Secretary of State's Office on [ ],
2001, as the same may be amended or supplemented from time to time.
Issuer LLC Agreement means the Amended and Restated Limited
Liability Company Agreement between the Issuer and Consumers, as
sole Member, dated as of [_______], 2001, as the same may be
amended or supplemented from time to time.
Issuer Officer's Certificate means a certificate signed by any
Authorized Officer of the Issuer, under the circumstances
described in, and otherwise complying with, the applica ble
requirements of Section 11.01 of the Indenture, and delivered to
the Trustee. Unless
otherwise specified, any reference in the Indenture to an
Officer's Certificate shall be to an Officer's Certificate of any
Authorized Officer of the Issuer.
Issuer Opinion of Counsel means one or more written opinions of
counsel who may, except as otherwise expressly provided in the
Indenture, be employees of or counsel to the Issuer or the Seller
and who shall be reasonably satisfactory to the Trustee, and which
opinion or opinions shall be addressed to the Trustee, and shall
be in a form reasonably satisfactory to the Trustee.
Issuer Order or Issuer Request means a written order or request,
respectively, signed in the name of the Issuer by any one of its
Authorized Officers and delivered to the Trustee.
Legal Defeasance Option has the meaning specified in Section
4.01(b) of the Indenture.
Lien means a security interest, lien, charge, pledge, equity or
encumbrance of any kind.
Losses means collectively, any and all liabilities, obligations,
losses, damages, payments, costs or expenses of any kind
whatsoever, but excluding consequential, exemplary or punitive
damages.
Manager has the meaning set forth in the Issuer LLC Agreement.
Member means Consumers, as the sole member of the Issuer, in its
capacity as such member under the Issuer LLC Agreement.
Michigan UCC means the Uniform Commercial Code, as in effect in
the State of Michigan, as amended from time to time.
Monthly Remittance Date means the [ ] day of each calendar month
(or if such day is not a Business Day, the following Business
Day).
Monthly Servicing Fee means the fee payable to the Servicer on a
monthly basis for services rendered, in accordance with Section
5.07 of the Servicing Agreement.
Moody's means Xxxxx'x Investors Service, Inc., or its successor.
MPSC means the Michigan Public Service Commission or its
successor.
MPSC Regulations means any regulations, orders, guidelines or
directives promulgated, issued or adopted by the MPSC, as in
effect from time to time.
Officers' Certificate means, with respect to a corporation, a
certificate signed by the chairman of the board, the president,
the vice chairman of the board, any executive vice president, any
vice president, the treasurer or the secretary of such company.
Operating Expenses means, with respect to the Issuer, all fees,
costs, expenses and indemnity payments owed by the Issuer,
including, without limitation, all amounts owed by the Issuer to
the Trustee, the Monthly Servicing Fee, the fees and expenses
payable by the Issuer to the Administrator under the
Administration Agreement, the fees and expenses payable by the
Issuer to the Independent Managers and Special Members of the
Issuer, fees of the Rating Agencies, legal fees and expenses of
the Servicer pursuant to Section 3.10 of the Servicing Agreement,
legal and accounting fees, costs and expenses of the Issuer and
legal, accounting or other fees, costs and expenses of the Seller
(includ ing, without limitation, any costs and expenses incurred
by the Seller pursuant to Section 4.09 of the Sale Agreement)
under or in connection with the Basic Documents or the Financing
Order.
Opinion of Counsel means one or more written opinions of counsel
who may be an employee of or counsel to Consumers, the Issuer or
any other Person (as the context may require), which counsel shall
be reasonably acceptable to the Trustee, the Issuer or the Rating
Agencies, as applicable, and which shall be in form reasonably
satisfactory to the Trustee, if applicable.
Outstanding with respect to Securitization Bonds means, as of the
date of determination, all Securitization Bonds theretofore
authenticated and delivered under the Indenture except:
(a) Securitization Bonds theretofore canceled by the
Securitization Bond Registrar or delivered to
the Securitization Bond Registrar for cancella
tion;
(b) Securitization Bonds or portions thereof the
payment for which money in the necessary amount
has been theretofore deposited with the Trustee
or any Paying Agent in trust for the Holders of
such Securitization Bonds; provided, however,
that if such Securitization Bonds are to be
redeemed, notice of such redemption has been
duly given pursuant to the Indenture or
provision therefor, satisfactory to the Trustee,
made; and
(c) Securitization Bonds in exchange for or in lieu
of other Securitization Bonds which have been
authenticated and delivered pursuant to the
Indenture unless proof satisfactory to the
Trustee is presented that any such
Securitization Bonds are held by a protected
purchaser;
provided that in determining whether the Holders of the requisite
Outstanding Amount of the Securitization Bonds or any Series or
Class thereof have given any request, demand, authorization,
direction, notice, consent or waiver hereunder or under any Basic
Docu ment, Securitization Bonds owned by the Issuer, any other
obligor upon the Securitization Bonds, Consumers or any Affiliate
of any of the foregoing Persons shall be disregarded and deemed
not to be Outstanding, except that, in determining whether the
Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only
Securitization Bonds that the Trustee knows to be so owned shall
be so disregarded. Securitization Bonds so owned that have been
pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Securitization
Bonds and that the pledgee is not the Issuer, any other obligor
upon the Securitization Bonds, Consumers or any Affiliate of any
of the foregoing Persons.
Outstanding Amount means the aggregate principal amount of all
Outstanding Securitiza tion Bonds or, if the context requires, all
Outstanding Securitization Bonds of a Series or Class Outstanding
at the date of determination.
Overcollateralization means, with respect to any Payment Date, an
amount that, if deposited to the Overcollateralization Subaccount,
would cause the balance in such subaccount to equal the Scheduled
Overcollateralization Level for such Payment Date, without regard
to investment earnings.
Overcollateralization Amount means, with respect to any Series of
Securitization Bonds, the amount specified as such in the Series
Supplement therefor.
Overcollateralization Subaccount has the meaning specified in
Section 8.02(a) of the Indenture.
Paying Agent means the Trustee or any other Person, including any
Person appointed pursuant to Section 3.02(b) of the Indenture,
that meets the eligibility standards for the Trustee specified in
Section 6.11 of the Indenture and is authorized by the Issuer to
make the payments of principal of or premium, if any, or interest
on the Securitization Bonds on behalf of the Issuer.
Payment Date means, with respect to each Series or Class of
Securitization Bonds, each date or dates respectively specified as
Payment Dates for such Series or Class in the Series Supplement
therefor.
Person means any individual, corporation, estate, partnership,
joint venture, association, joint stock company, trust (including
any beneficiary thereof), business trust, limited liability
company, unincorporated organization or government or any agency
or political subdivision thereof.
Predecessor Securitization Bond means, with respect to any
particular Securitization Bond, every previous Securitization Bond
evidencing all or a portion of the same debt as that evidenced by
such particular Securitization Bond; and, for the purpose of this
definition, any Securitization Bond authenticated and delivered
under Section 2.06 of the Indenture in lieu of a mutilated, lost,
destroyed or stolen Securitization Bond shall be deemed to
evidence the same debt as the mutilated, lost, destroyed or stolen
Securitiza tion Bond.
Principal means, with respect to any Payment Date and each Series
or Class of Securiti zation Bonds:
(a) the amount of principal scheduled to be paid on
such Payment Date in accordance with the
Expected Amortization Schedule;
(b) the amount of principal due on the Final
Maturity Date of any Series or Class if such
Payment Date is the Final Maturity Date;
(c) the amount of principal due as a result of the
occurrence and continuance of an Event of
Default and acceleration of the Securitization
Bonds;
(d) the amount of principal and premium, if any, due
as a result of a redemp tion of Securitization
Bonds on such Payment Date; and
(e) any overdue payments of principal.
Pro Rata has the meaning set forth in Section 8.02(h) of the
Indenture.
Proceeding means any suit in equity, action at law or other
judicial or administrative proceeding.
Projected Securitization Bond Balance means, as of any date, the
sum of the amounts provided for in the Expected Amortization
Schedules for each Outstanding Series of Securitization Bonds as
of such date.
Rating Agency means, as of any date, any rating agency rating the
Securitization Bonds of any Class or Series at the time of
issuance thereof at the request of the Issuer. If no such
organization or successor is any longer in existence, "Rating
Agency" shall be a nation ally recognized statistical rating
organization or other comparable Person designated by the Issuer,
notice of which designation shall be given to the Trustee, the
Member and the Servicer.
Rating Agency Condition means, with respect to any action, the
notification by the Trustee to each Rating Agency and the
notification from each Rating Agency to the Trustee and the Issuer
that such action will not result in a reduction or withdrawal of
the then current rating by such Rating Agency of any Outstanding
Series or Class of Securiti zation Bonds.
Record Date has the meaning set forth in each Supplemental
Indenture.
Redemption Date means, with respect to each Series or Class of
Securitization Bonds, the date for the redemption of the
Securitization Bonds of such Series or Class pursuant to Sections
10.01 or 10.02 of the Indenture or the Series Supplement for such
Series or Class, which in each case shall be a Payment Date.
Redemption Price has the meaning set forth in Section 10.01 of the
Indenture.
Refunding Issuance means an issuance of a new Series of
Securitization Bonds under the Indenture to pay the cost of
refunding, through redemption or payment on the Expected Final
Payment Date for a Series or Class of Securitization Bonds, all or
part of the Securitization Bonds of such Series or Class to the
extent permitted by the terms thereof.
Released Parties has the meaning specified in Section 5.02(e) of
the Servicing Agreement.
Remittance Date means a Daily Remittance Date or a Monthly
Remittance Date, as applicable.
Required Capital Amount means with respect to any Series, the
amount required to be deposited in the Capital Subaccount on the
Series Issuance Date of such Series, as specified in the related
Series Supplement.
Reserve Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Responsible Officer means, with respect to the Trustee, any
officer assigned to the Corporate Trust Division (or any successor
thereto), including any vice president, assistant vice president,
trust officer, secretary, assistant secretary, or any other
officer of the Trustee customarily performing functions similar to
those performed by any of the above designated officers, in each
case having direct responsibility for the administration of the
Indenture.
Retiring Trustee has the meaning specified in Section 6.08(b) of
the Indenture.
Sale Agreement means the Sale Agreement dated [________], 2001
between the Seller and the Issuer, as the same may be amended or
supplemented from time to time.
Scheduled Overcollateralization Level means, with respect to each
Series and any Payment Date, the amount with respect to such
Series set forth as such in Schedule B of the Series Supplement.
Secured Obligations has the meaning set forth in the Granting
Clause of the Indenture.
Securities Account Control Agreement means the securities account
control agreement dated as of [ ], 2001, by and between Consumers
Funding LLC, as debtor, the Trustee as the secured party and The
Bank of New York, in its capacity as securities intermediary
thereunder.
Securitization Bond means any of the Securitization Bonds (as
defined in the Customer Choice Act) issued by the Issuer pursuant
to the Indenture.
Securitization Bond Balance means, as of any date, the aggregate
Outstanding Amount of all Series of Securitization Bonds on such
date.
Securitization Bond Register has the meaning specified in Section
2.05(a) of the Indenture.
Securitization Bond Registrar has the meaning specified in Section
2.05(a) of the Indenture.
Securitization Charge means the nonbypassable amounts to be
charged for the use or availability of electric services (but does
not include tax charges authorized by the Financing Order),
approved by the MPSC under the Financing Order, to fully recover
qualified costs, to be collected by Consumers, its successors or
an assign, as provided for in the Financing Order.
Securitization Charge Adjustment means each adjustment to the
Securitization Charge related to the Transferred Securitization
Property made in accordance with Section 4.01 of the Servicing
Agreement, the Issuer Annex and the Financing Order.
Securitization Charge Collections means amounts received by the
Servicer in respect of the Securitization Charge as determined by
the Servicer in accordance with the allocation methodology set
forth in Annex 2 to the Servicing Agreement.
Securitization Property has the meaning assigned to that term in
the Customer Choice Act and as approved with respect to Consumers
in the Financing Order, provided that Securitization Charge
Collections with respect to the Securitization Property shall be
determined in accordance with the allocation methodology set forth
in Annex 2 to the Servicing Agreement.
Securitization Property Documentation means all documents relating
to the Transferred Securitization Property, including copies of
the Financing Order and all documents filed with the MPSC in
connection with any Securitization Charge Adjustment.
Securitization Ratio means for an entire Billing Month the total
Securitization Charges billed by the Servicer for each rate class
divided by the total charges billed by Consumers and the Servicer
for each rate class to customers for such Billing Month. Customers
for this purpose refers to Consumers' electric and combination
electric and gas customers. For purposes of allocation to daily
collection calculations of Securitization Charges collected, the
rates shall be adjusted for the differences in the number of
billing days in the respective Billing Months. Seller means
Consumers, in its capacity as seller of the Securitization
Property to the Issuer pursuant to the Sale Agreement.
Series means any series of Securitization Bonds issued by the
Issuer and authenticated by the Trustee pursuant to the Indenture,
as specified in the Series Supplement therefor.
Series Capital Subaccount has the meaning specified in Section
8.02(a) of the Indenture.
Series Issuance Date means, with respect to any Series, the date
on which the Securitiza tion Bonds of such Series are to be
originally issued in accordance with Section 2.10 of the Indenture
and the Series Supplement for such Series.
Series Overcollateralization Subaccount has the meaning specified
in Section 8.02(a) of the Indenture.
Series Subaccount has the meaning specified in Section 8.02(a) of
the Indenture.
Series Supplement means an indenture supplemental to the Indenture
that authorizes a particular Series of Securitization Bonds, as
the same may be amended or supplemented from time to time.
Servicer means Consumers, as the servicer of the Securitization
Property, and each successor to Consumers (in the same capacity)
pursuant to Section 5.03, 5.04 or 6.04 of the Servicing Agreement.
Servicer Default means an event specified in Section 6.01 of the
Servicing Agreement.
Servicing Agreement means the Servicing Agreement dated as of
[________], 2001 between the Issuer and the Servicer, as the same
may be amended and supplemented from time to time.
Special Member has the meaning set forth in the Issuer LLC
Agreement.
Standard & Poor's, or S&P, means Standard & Poor's Ratings Group,
a division of The XxXxxx-Xxxx Companies, or its successor.
State means any one of the 50 states of the United States of
America or the District of Columbia.
Subaccount means any of the subaccounts of the Collection Account
specified in Section 8.02 of the Indenture.
Subsequent Sale means the sale of additional Securitization
Property by the Seller to the Issuer after the Initial Transfer
Date, subject to the satisfaction of the conditions specified in
the Sale Agreement and the Indenture.
Subsequent Transfer Date means the date that a sale of Subsequent
Transferred Securiti zation Property will be effective, as
specified in a written notice provided by the Seller to the Issuer
pursuant to the Sale Agreement.
Subsequent Transferred Securitization Property means
Securitization Property sold by the Seller to the Issuer as of a
Subsequent Transfer Date pursuant to the Sale Agreement and the
Xxxx of Sale delivered on or prior to the Subsequent Transfer Date
as identified in such Xxxx of Sale.
Successor Servicer has the meaning specified in Section 3.19(i) of
the Indenture.
Supplemental Indenture means a supplemental indenture entered into
by the Issuer and the Trustee pursuant to Article IX of the
Indenture.
Swap Counterparty means, with respect to any Interest Rate Swap
Agreement, the swap counterparty under that Interest Rate Swap
Agreement.
Termination Notice has the meaning specified in Section 6.01(d) of
the Servicing Agreement.
Transfer Date means the Initial Transfer Date or any Subsequent
Transfer Date, as applicable.
Transferred Securitization Property means Securitization Property
which has been sold, assigned and transferred to the Issuer
pursuant to the Sale Agreement.
Trust Indenture Act or TIA means the Trust Indenture Act of 1939,
as in force on the date hereof, unless otherwise specifically
provided.
Trustee means The Bank of New York, a New York banking
corporation, or its successor, as trustee under the Indenture, or
any successor Trustee under the Indenture.
UCC means the Uniform Commercial Code, as in effect in the
relevant jurisdiction, as amended from time to time.
Underwriting Agreement means the Underwriting Agreement dated as
of [_________], 2001 among the Seller, the Issuer and Xxxxxx
Xxxxxxx & Co., Incorporated, on behalf of itself and as the
representative of the several underwriters named therein.
U.S. Government Obligations means direct obligations (or
certificates representing an ownership interest in such
obligations) of the United States of America (including any agency
or instrumentality thereof) for the payment of which the full
faith and credit of the United States of America is pledged and
which are not callable at the issuer's option.
