EXHIBIT 10.6
AMENDED AND RESTATED
TRUST AGREEMENT
BETWEEN
VOLKSWAGEN DEALER FINANCE, LLC,
as Transferor
AND
THE BANK OF NEW YORK,
as Owner Trustee
DATED AS OF __________ , 200 _
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE........................................... 1
SECTION 1.1 DEFINITIONS.......................................................................... 1
ARTICLE II ORGANIZATION......................................................................... 1
SECTION 2.1 Name........................................................................ 1
SECTION 2.2 Office...................................................................... 2
SECTION 2.3 Purposes and Powers......................................................... 2
SECTION 2.4 Appointment of Owner Trustee................................................ 2
SECTION 2.5 Initial Capital Contribution of Owner Trust Estate.......................... 3
SECTION 2.6 Declaration of Trust........................................................ 3
SECTION 2.7 Liability of the Residual Interestholder.................................... 3
SECTION 2.8 Title to Trust Property..................................................... 3
SECTION 2.9 Situs of Trust.............................................................. 3
SECTION 2.10 Representations and Warranties of the Transferor............................ 3
SECTION 2.11 Federal Income Tax Allocations; Tax Treatment............................... 4
ARTICLE III RESIDUAL INTEREST.................................................................... 5
SECTION 3.1 Ownership................................................................... 5
SECTION 3.2 Maintenance of Office or Agency............................................. 6
SECTION 3.3 Appointment of Paying Agent................................................. 6
ARTICLE IV ACTIONS BY OWNER TRUSTEE............................................................. 6
SECTION 4.1 Prior Notice to Residual Interestholder with Respect to Certain Matters..... 6
SECTION 4.2 Action by Residual Interestholder with Respect to Certain Matters........... 7
SECTION 4.3 Action by Residual Interestholder with Respect to Bankruptcy................ 7
SECTION 4.4 Restrictions on Residual Interestholder's Power............................. 7
ARTICLE V APPLICATION OF TRUST FUNDS; CERTAIN DUTIES........................................... 8
SECTION 5.1 Establishment of Residual Interest Distribution Account..................... 8
SECTION 5.2 Application of Trust Funds.................................................. 8
SECTION 5.3 Method of Payment........................................................... 9
SECTION 5.4 Accounting and Reports to the Residual Interestholder, the Internal
Revenue Service and Others.................................................. 9
SECTION 5.5 Signature on Returns; Tax Matters Partner................................... 10
ARTICLE VI THE OWNER TRUSTEE.................................................................... 10
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TABLE OF CONTENTS
continued
PAGE
SECTION 6.1 Duties of Owner Trustee..................................................... 10
SECTION 6.2 Rights of Owner Trustee..................................................... 11
SECTION 6.3 Acceptance of Trusts and Duties............................................. 11
SECTION 6.4 Action upon Instruction by Residual Interestholder.......................... 12
SECTION 6.5 Furnishing of Documents..................................................... 13
SECTION 6.6 Representations and Warranties of Owner Trustee............................. 13
SECTION 6.7 Reliance; Advice of Counsel................................................. 14
SECTION 6.8 Owner Trustee May Own the Residual Interest and Notes....................... 14
SECTION 6.9 Compensation and Indemnity.................................................. 15
SECTION 6.10 Replacement of Owner Trustee................................................ 15
SECTION 6.11 Merger or Consolidation of Owner Trustee.................................... 16
SECTION 6.12 Appointment of Co-Trustee or Separate Trustee............................... 16
SECTION 6.13 Eligibility Requirements for Owner Trustee.................................. 17
ARTICLE VII TERMINATION OF TRUST AGREEMENT....................................................... 18
SECTION 7.1 Termination of Trust Agreement.............................................. 18
ARTICLE VIII AMENDMENTS........................................................................... 18
ARTICLE IX MISCELLANEOUS........................................................................ 20
SECTION 9.1 No Legal Title to Owner Trust Estate........................................ 20
SECTION 9.2 Limitations on Rights of Others............................................. 20
SECTION 9.3 Notices..................................................................... 20
SECTION 9.4 Severability of Provisions.................................................. 20
SECTION 9.5 Counterparts................................................................ 20
SECTION 9.6 Successors and Assigns...................................................... 20
SECTION 9.7 No Petition Covenant........................................................ 20
SECTION 9.8 No Recourse................................................................. 21
SECTION 9.9 Headings.................................................................... 21
SECTION 9.10 Governing Law............................................................... 21
SECTION 9.11 Indemnification by and Reimbursement of the Servicer........................ 21
SECTION 9.12 Third-Party Beneficiaries................................................... 21
SECTION 9.13 Submission to Jurisdiction.................................................. 21
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THIS AMENDED AND RESTATED TRUST AGREEMENT, dated as of __________ , 200
_ (as amended, supplemented or modified from time to time, this "Agreement"),
between VOLKSWAGEN DEALER FINANCE, LLC, a Delaware limited liability company, as
Transferor (the "Transferor"), and THE BANK OF NEW YORK, a New York banking
corporation, as Owner Trustee (not in its individual capacity but solely as
Owner Trustee, the "Owner Trustee").
W I T N E S S E T H :
WHEREAS, the parties hereto are parties to that certain Trust Agreement
dated as of August 3, 2000 (the "Existing Agreement");
WHEREAS, under the Existing Agreement, the parties thereto formed the
Volkswagen Credit Auto Master Owner Trust, a New York common law trust;
WHEREAS, the Volkswagen Credit Auto Master Owner Trust has elected to
become a Delaware statutory trust (the "Trust") pursuant to the Delaware
Statutory Trust Act, 12 Del. C. Section 3801, et seq. (the "Trust Statute"); and
WHEREAS, this Agreement amends and restates as of the date hereof in
its entirety the Existing Agreement, and upon the effectiveness of this
Agreement, the terms and provisions of the Existing Agreement shall be
superseded hereby in their entirety.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the Existing Agreement is hereby amended and restated in its entirety
as follows:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions. Certain capitalized terms used in this
Agreement shall have the respective meanings assigned to them in Part I of
Appendix A to the Amended and Restated Trust Sale and Servicing Agreement dated
as of __________ , 200 _ , among the Transferor, the Servicer and the Trust (the
"Trust Sale and Servicing Agreement"). All references herein to Articles,
Sections and subsections are to Articles, Sections and subsections of this
Agreement unless otherwise specified. The rules of construction set forth in
Part II of Appendix A to the Trust Sale and Servicing Agreement shall be
applicable to this Agreement.
ARTICLE II
ORGANIZATION
SECTION 2.1 Name. The Trust created under the Existing Trust Agreement,
and created as a Delaware statutory trust by the filing of the certificate of
trust pursuant to the Trust Statute, and continued hereby shall be known as
"Volkswagen Credit Auto Master Owner Trust" in which name the Owner Trustee may
conduct the business of the Trust, make and execute contracts and other
instruments on behalf of the Trust and xxx and be sued on behalf of the Trust.
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SECTION 2.2 Office. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address in outside
of New York as the Owner Trustee may designate by written notice to the Residual
Interestholder and the Transferor.
SECTION 2.3 Purposes and Powers. The purpose of the Trust is, and the
Trust shall have the power and authority, to engage in the following activities:
(a) to acquire, manage and hold the Receivables to be transferred to
the Trust from time to time pursuant to the Trust Sale and Servicing Agreement;
(b) to issue and sell the Notes pursuant to the Indenture or to another
indenture, note purchase agreement or similar agreement and to sell, transfer or
exchange the Notes;
(c) to acquire property and assets from the Transferor pursuant to the
Trust Sale and Servicing Agreement, to make payments or distributions on the
Notes to the Noteholders and with respect to the Residual Interest to the
Residual Interestholder, to make withdrawals from the accounts established
pursuant to the Basic Documents and to pay the organizational, start-up and
transactional expenses of the Trust;
(d) to establish, acquire, hold and terminate liquidity, credit and
other enhancement arrangements, and perform its obligations thereunder;
(e) to assign, grant, transfer, pledge, mortgage and convey the Trust
Estate pursuant to the terms of the Indenture and to hold, manage such Trust
Estate and distribute funds to the Residual Interestholder pursuant to the terms
of this Agreement and the Trust Sale and Servicing Agreement any portion of the
Trust Estate released from the lien of, and remitted to the Trust pursuant to,
the Indenture;
(f) to enter into and perform its obligations and exercise its rights
under the Basic Documents to which it is to be a party;
(g) to engage in those activities, including entering into agreements,
that are necessary, suitable or convenient to accomplish the foregoing or are
incidental thereto or connected therewith; and
(h) subject to compliance with the Basic Documents, to engage in such
other activities as may be required in connection with conservation of the Owner
Trust Estate and the making of distributions to the Noteholders and the Residual
Interestholder.
The Trust shall not engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of this
Agreement, the other Basic Documents or the Trust Statute.
SECTION 2.4 Appointment of Owner Trustee. The Transferor hereby
appoints the Owner Trustee as trustee of the Trust effective as of the date
hereof, to have all the rights, powers and duties set forth herein under the
Trust Statute. Pursuant to a Co-Trustee Agreement dated as of the date hereof
(the "Co-Trustee Agreement"), the Owner Trustee and the Administrator shall
appoint The Bank of New York (Delaware) to serve as the trustee (the
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"Delaware Trustee") of the Trust in the State of Delaware for the sole purpose
of satisfying the requirement of Section 3807 of the Trust Statute that the
Trust have at least one trustee with a principal place of business in Delaware.
The Delaware Trustee shall have none of the rights, duties or liabilities of the
Trustee. The rights, duties and liabilities of the Delaware Trustee shall be
limited to those expressly set forth in the Co-Trustee Agreement. To the extent
that, at law or in equity, the Delaware Trustee has rights, duties (including
fiduciary duties) and liabilities relating to the Trust or the Residual
Interestholders, such rights, duties and liabilities are replaced by the rights,
duties and liabilities of the Delaware Trustee expressly set forth in the
Co-Trustee Agreement.
SECTION 2.5 Initial Capital Contribution of Owner Trust Estate.
Pursuant to the Trust Sale and Servicing Agreement, the Transferor has sold,
assigned, transferred, conveyed and set over to the Owner Trustee, the assets
specified in the Trust Sale and Servicing Agreement. The Owner Trustee has
acknowledged receipt in trust from the Transferor, as of August 3, 2000, of the
foregoing contribution, which shall constitute the initial Owner Trust Estate.
The Transferor shall continue to pay organizational expenses of the Trust as
they may arise or shall, upon the request of the Owner Trustee, promptly
reimburse the Owner Trustee for any such expenses paid by the Owner Trustee.
SECTION 2.6 Declaration of Trust. The Owner Trustee hereby declares
that it shall hold the Owner Trust Estate in trust upon and subject to the
conditions and obligations set forth herein and in the Trust Sale and Servicing
Agreement for the use and benefit of the Residual Interestholder, subject to the
obligations of the Trust under the Basic Documents and under the Trust Statute.
It is the intention of the parties hereto that the Trust constitute a statutory
trust under the Trust Statute, that this Agreement and the Certificate of Trust
filed in the State of Delaware constitute the governing instruments of such
trust. The Owner Trustee shall file the Certificate of Trust in the Form
Attached hereto Exhibit A with the Secretary of State of the State of Delaware
on _____ , 200 _ .
SECTION 2.7 Liability of the Residual Interestholder. The Residual
Interestholder shall not have any personal liability or obligation of the Trust.
SECTION 2.8 Title to Trust Property. Legal title to all the Owner Trust
Estate shall be vested at all times in the Trust as a separate legal entity.
SECTION 2.9 Situs of Trust. The Trust shall be located and administered
in the State of Delaware. All bank accounts maintained by the Owner Trustee on
behalf of the Trust shall be located in the State of New York or Delaware. The
Trust shall not have any employees in any state other than the State of New
York; provided, however, that nothing herein shall restrict or prohibit the
Owner Trustee from having employees within or without the State of Delaware.
Payments shall be received by the Trust only in the State of Delaware or the
State of New York, and payments and distributions shall be made by the Trust
only from the State of Delaware or the State of New York.
SECTION 2.10 Representations and Warranties of the Transferor. The
Transferor hereby represents and warrants to the Owner Trustee that, as of the
date hereof:
(a) Organization and Power. The Transferor is a limited liability
company validly existing and in good standing under the laws of the State
of Delaware and has all
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power and authority required to carry on its business as it is now
conducted. The Transferor has obtained all necessary licenses and
approvals in all jurisdictions where the failure to do so would materially
and adversely affect the business, properties, financial condition or
results of operations of the Transferor, taken as a whole.
(b) Authorization and No Contravention. The execution, delivery and
performance by the Transferor of each Basic Document to which it is a
party (i) have been duly authorized by all necessary limited liability
company action and (ii) do not violate or constitute a default under (A)
any applicable law, rule or regulation, (B) its organizational instruments
or (C) any agreement, contract, order or other instrument to which it is a
party or its property is subject.
(c) No Consent Required. No approval, authorization or other action by,
or filing with, any Governmental Authority is required in connection with
the execution, delivery and performance by the Transferor of any Basic
Document other than UCC filings and other than approvals and
authorizations that have previously been obtained and filings which have
previously been made.
(d) Binding Effect. Each Basic Document to which the Transferor is a
party constitutes the legal, valid and binding obligation of the
Transferor enforceable against the Transferor in accordance with its
terms, except as limited by bankruptcy, insolvency, or other similar laws
of general application relating to or affecting the enforcement of
creditors' rights generally and subject to general principles of equity.
(e) No Proceedings. There is no action, suit, proceeding or
investigation pending or, to the knowledge of the Transferor, threatened
against the Transferor which, either in any one instance or in the
aggregate, would result in any material adverse change in the business,
operations, financial condition, properties or assets of the Transferor,
or in any material impairment of the right or ability of the Transferor to
carry on its business substantially as now conducted, or in any material
liability on the part of the Transferor, or which would render invalid
this Agreement or the Receivables or the obligations of the Transferor
contemplated herein, or which would materially impair the ability of the
Transferor to perform under the terms of this Agreement or any other Basic
Document.
SECTION 2.11 Federal Income Tax Allocations; Tax Treatment.
(a) If the Residual Interest is held by more than one Person or the
Trust is recharacterized as a separate entity the net income of the Trust for
any month as determined for federal income tax purposes (and each item of
income, gain, loss and deduction entering into the computation thereof) shall be
allocated:
(1) first, to the holder(s) of interests in the Residual Interest as of
the close of business on the last day of such month, in proportion to
their interests in the Residual Interest, any amounts of income payable in
respect of the Residual Interest for such month; and
(2) second, to the holder(s) of interests in the Residual Interest, and
to other holders of interests in the Reserve Account, to the extent of any
remaining net income, in accordance with their respective interest
therein.
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If the net income of the Trust for any month is insufficient for the allocations
described in subclause (a)(1), subsequent net income shall first be allocated to
make up such shortfall before being allocated as provided in the preceding
sentence. Net losses of the Trust, if any, for any month as determined for
federal income tax purposes (and each item of income, gain, loss and deduction
entering into the computation thereof) shall be allocated to the Transferor or
other holders of interests in the Reserve Account to the extent the Transferor
or other holders of interests in the Reserve Account are reasonably expected to
bear the economic burden of such net losses, and any remaining net losses shall
be allocated to any other holder of an interest in the Residual Interest as of
the close of business on the last day of such month in proportion to such
Person's interest in the Residual Interest on such day. The Transferor is
authorized to modify the allocations in this paragraph if necessary or
appropriate, in its sole discretion, for the allocations to fairly reflect the
economic income, gain or loss to the Transferor or other holders of interests in
the Reserve Account, or as otherwise required by the Code.
(b) All "excess nonrecourse liabilities" represented by all outstanding
Notes issued by the Trust, as well as the deductions attributable thereto, shall
be allocated one hundred percent to the Transferor in accordance with Treasury
Regulations section 1.752-3(a)(3). Notwithstanding any other provision of this
Agreement, if the Residual Interest is held solely by one Person or the Trust
has not been recharacterized as a separate entity, the application of clause (a)
and this clause (b) shall be disregarded.
(c) It is the intent of the parties hereto that, solely for purposes of
federal income, state and local income, franchise and single business tax and
any other taxes measured in whole or in part by income, until the Residual
Interest is held by more than one Person or the Trust is recharacterized as a
separate entity, the Trust will be disregarded as an entity separate from its
beneficial owner and the Notes will be treated as debt. If the Residual Interest
is held by more than one Person or the Trust is recharacterized as a separate
entity, it is the intention of the parties hereto that, solely for purposes of
federal income, state and local income, franchise and single business tax and
any other taxes measured in whole or in part by income, the Trust shall be
treated as a partnership and the Residual Interestholder(s) and the Transferor
shall be treated as partners in that partnership with the assets of the
partnership being the Receivables and other assets held by the Trust, and the
Notes being debt of that partnership. The parties agree that, unless otherwise
required by appropriate tax authorities, the Trust shall file or cause to be
filed annual or other necessary returns, reports and other forms consistent with
the characterization of the Trust as a partnership for such tax purposes.
ARTICLE III
RESIDUAL INTEREST
SECTION 3.1 Ownership. The Residual Interest shall represent an
undivided ownership interest in the Trust. The Transferor shall be the only
holder of the Residual Interest. The Residual Interest shall not be
certificated, shall not have a principal balance and shall not bear interest.
The Transferor shall not sell, assign, pledge or otherwise transfer the Residual
Interest. Any amendment to this Agreement which would change the foregoing shall
be subject to the condition that the Transferor shall retain at least 1/10th of
1% of the Residual Interest. The Residual Interest may not be acquired by or
held on behalf of a Benefit Plan.
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SECTION 3.2 Maintenance of Office or Agency. The Owner Trustee shall
maintain an office or offices or agency or agencies in New York where notices
and demands to or upon the Owner Trustee in respect of the Residual Interest and
the Basic Documents may be served. The Owner Trustee initially designates the
Corporate Trust Office of the Owner Trustee as its office for such purposes. The
Owner Trustee shall give prompt written notice to the Transferor, the Servicer
and the Indenture Trustee of any change in the location of any such office or
agency.
SECTION 3.3 Appointment of Paying Agent. The Owner Trustee may appoint
a Paying Agent. If so appointed, such Paying Agent shall make distributions to
Residual Interestholder from the Residual Interest Distribution Account pursuant
to Section 5.2 and shall report the amounts of such distributions to the Owner
Trustee and the Servicer; provided that no such reports shall be required so
long as the Transferor is the sole Residual Interestholder. For so long as the
Indenture is in effect, notwithstanding anything in this Agreement to the
contrary, all amounts to be distributed to the Residual Interestholder or the
Residual Interest Distribution Account shall be distributed by the Indenture
Trustee as required by the Series Supplement. Any Paying Agent shall have the
revocable power to withdraw funds from the Residual Interest Distribution
Account for the purpose of making the distributions referred to above. The Owner
Trustee may revoke such power and remove any Paying Agent appointed by it. Any
Paying Agent shall be permitted to resign as Paying Agent upon 30 days' written
notice to the Owner Trustee, whereupon the Owner Trustee may appoint a successor
to act as the Paying Agent (which shall be a bank or trust company). The Owner
Trustee shall cause such successor Paying Agent or any additional Paying Agent
appointed by the Owner Trustee to execute and deliver to the Owner Trustee an
instrument in which such successor Paying Agent or additional Paying Agent shall
agree with the Owner Trustee that as Paying Agent, such successor Paying Agent
or additional Paying Agent shall hold all sums, if any, held by it for
distribution to the Residual Interestholder in trust for the benefit of the
Residual Interestholder until such sum shall be paid to the Residual
Interestholder. The Paying Agent shall return all unclaimed funds to the Owner
Trustee and upon the removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Owner Trustee. The provisions of
Sections 6.3, 6.6, 6.7 and 6.9 shall apply to the Owner Trustee also in its role
as Paying Agent, for so long as the Owner Trustee shall act as Paying Agent and,
to the extent applicable, to any other paying agent appointed hereunder. Any
reference in this Agreement to the Paying Agent shall include any co-paying
agent unless the context requires otherwise.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1 Prior Notice to Residual Interestholder with
Respect to Certain Matters. The Owner Trustee shall not take action with respect
to the following matters, unless (i) the Owner Trustee shall have notified the
Residual Interestholder in writing of the proposed action at least 30 days
before the taking of such action, and (ii) the Residual Interestholder shall not
have notified the Owner Trustee in writing prior to the 30th day after such
notice is given that such Residual Interestholder has withheld consent or
provided alternative direction:
(a) the initiation of any claim or lawsuit by the Trust (other than an
action to collect on a Receivable or an action by the Indenture Trustee pursuant
to the Indenture) and the
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compromise of any action, claim or lawsuit brought by or against the Trust
(other than an action to collect on a Receivable or an action by the Indenture
Trustee pursuant to the Indenture);
(b) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(c) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is not required and such
amendment materially adversely affects the interest of the Residual
Interestholder;
(d) the amendment, change or modification of the Administration
Agreement, except to cure any ambiguity or to amend or supplement any provision
in a manner that would not materially adversely affect the interests of the
Residual Interestholder; or
(e) the appointment pursuant to the Indenture of a successor Note
Registrar, Paying Agent or Indenture Trustee, or the consent to the assignment
by the Note Registrar, Paying Agent or Indenture Trustee of its obligations
under the Indenture or this Agreement, as applicable.
SECTION 4.2 Action by Residual Interestholder with Respect to Certain
Matters. The Owner Trustee shall not have the power, except upon the written
direction of the Residual Interestholder, as described in the last sentence of
this Section 4.2, to (a) remove the Administrator under the Administration
Agreement pursuant to Section 10 thereof, (b) appoint a successor Administrator
pursuant to Section 10 of the Administration Agreement, (c) remove the Servicer
under the Trust Sale and Servicing Agreement pursuant to Section 7.2 thereof or
(d) except as expressly provided in the Basic Documents, sell the Receivables
transferred to the Trust pursuant to the Trust Sale and Servicing Agreement or
any interest therein after the termination of the Indenture. The Owner Trustee
shall take the actions referred to in the preceding sentence only upon the
affirmative vote of, or a written consent signed by, the holders of a majority
of the Voting Interests upon at least 30 days prior notice thereof.
SECTION 4.3 Action by Residual Interestholder with Respect to
Bankruptcy. The Owner Trustee shall not have the power to commence a voluntary
proceeding in bankruptcy relating to the Trust without the prior approval of the
Residual Interestholder and the delivery to the Owner Trustee by the Residual
Interestholder of a certificate certifying that such Residual Interestholder
reasonably believes that the Trust is insolvent. The Transferor agrees that it,
at any time that it is the Residual Interestholder, shall not approve or be
deemed to have approved the commencement of a voluntary proceeding in bankruptcy
relating to the Trust for purposes of this Section 4.3 unless such commencement
is approved by the affirmative vote of all of the members of the Transferor's
board of directors.
SECTION 4.4 Restrictions on Residual Interestholder's Power. The
Residual Interestholder shall not direct the Owner Trustee to take or refrain
from taking any action if such action or inaction would be contrary to any
obligation of the Trust or the Owner Trustee under this Agreement or any of the
Basic Documents or would be contrary to Section 2.3, nor shall the Owner Trustee
be obligated to follow any such direction, if given.
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ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1 Establishment of Residual Interest Distribution Account.
(a) The Servicer, for the benefit of the Residual Interestholder, shall
cause to be established and maintained in the name of the Trust an Eligible
Deposit Account known as the Volkswagen Credit Auto Master Owner Trust Residual
Interest Distribution Account (the "Residual Interest Distribution Account"),
bearing an additional designation clearly indicating that the funds deposited
therein are held for the benefit of the Residual Interestholder. The Residual
Interest Distribution Account shall initially be established with the Owner
Trustee.
(b) The Trust shall possess all right, title and interest in and to all
funds on deposit from time to time in the Residual Interest Distribution Account
and in all proceeds thereof for the benefit of the Residual Interestholder.
Except as otherwise provided herein or in the Trust Sale and Servicing
Agreement, the Residual Interest Distribution Account shall be under the sole
dominion and control of the Trust for the benefit of the Residual
Interestholder. If, at any time, any Residual Interest Distribution Account
ceases to be an Eligible Deposit Account, the Servicer, within 10 days of
determining that such Residual Interest Distribution Account is no longer an
Eligible Deposit Account, shall establish a substitute Eligible Deposit Account
as such Residual Interest Distribution Account, instruct the Owner Trustee in
writing to transfer any cash and/or any Eligible Investments to such new
Residual Interest Distribution Account and, from the date any such substitute
account is established, such account shall be the Residual Interest Distribution
Account.
All Eligible Investments shall be held by the Trust as
applicable, for the benefit of the Residual Interestholder. Funds on deposit in
the Residual Interest Distribution Account shall at the written direction of the
Servicer be invested by the Owner Trustee, solely in Eligible Investments that
will mature so that such funds will be available at the close of business on the
next Business Day. All interest and other investment earnings (net of losses and
investment expenses) on funds on deposit in the Residual Interest Distribution
Account shall be credited to the Residual Interest Distribution Account when
received. In the absence of timely and specific written investment direction
from the Servicer, the Owner Trustee shall invest any cash held by the Trust in
Eligible Investments specified in clause (h) of the definition thereof. In no
event shall the Owner Trustee be liable for the selection of investments or for
investment losses incurred thereon. The Owner Trustee shall have no liability in
respect of losses incurred as a result of the liquidation of any investment
prior to its stated maturity or the failure of the Servicer to provide timely
written investment direction.
SECTION 5.2 Application of Trust Funds.
(a) On each Payment Date, the Owner Trustee shall distribute to the
Residual Interestholder the amounts deposited in the Residual Interest
Distribution Account as set forth in the applicable Series Supplement.
Notwithstanding the foregoing or anything else to the contrary in this Agreement
or the other Basic Documents, so long as Transferor is the Residual
Interestholder, (i) no Residual Interestholder Distribution Account shall be
required to be established or maintained and (ii) all distributions and payments
on the Residual Interest required hereunder or under the Indenture or the
applicable Series
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Supplement shall be made directly to the Transferor by the Owner Trustee
(whether or not the Indenture or the applicable Series Supplement otherwise
contemplates deposit into the Residual Interest Distribution Account) and the
Indenture Trustee and the Owner Trustee shall have no duty or liability to see
to such distribution.
(b) On each Payment Date, the Owner Trustee shall send to the Residual
Interestholder the statement provided to the Owner Trustee by the Servicer
pursuant to Section 3.4 of the Trust Sale and Servicing Agreement on such
Payment Date.
(c) If the Owner Trustee determines, whether as a result of advice from
the Administrator or otherwise, that any withholding tax is imposed on the
Trust's distribution (or allocations of income) to the Residual Interestholder,
such tax shall reduce the amount otherwise distributable to the Residual
Interestholder in accordance with this Section 5.2; provided that the Owner
Trustee shall not have an obligation to withhold any such amount so long as the
Transferor is the Residual Interestholder. The Owner Trustee is hereby
authorized and directed to retain from amounts otherwise distributable to the
Residual Interestholder sufficient funds for the payment of any tax that is
legally owed by the Trust (but such authorization shall not prevent the Owner
Trustee (without any obligation to do so) from contesting any such tax in
appropriate proceedings and withholding payment of such tax, if permitted by
law, pending the outcome of such proceedings). The amount of any withholding tax
imposed with respect to the Residual Interestholder shall be treated as cash
distributed to such Residual Interestholder at the time it is withheld by the
Trust and remitted to the appropriate taxing authority. If there is a
possibility that withholding tax is payable with respect to a distribution (such
as a distribution to a non-U.S. Residual Interestholder), the Owner Trustee may
in its sole discretion (but shall not be required to) withhold such amounts in
accordance with this Section 5.2(c). If the Residual Interestholder wishes to
apply for a refund of any such withholding tax, the Owner Trustee shall
reasonably cooperate with such Residual Interestholder in making such claim so
long as such Residual Interestholder agrees to reimburse the Owner Trustee for
any out-of-pocket expenses incurred.
SECTION 5.3 Method of Payment. Distributions required to be made to the
Residual Interestholder on any Payment Date shall be made to the Residual
Interestholder either by wire transfer, in immediately available funds, to the
account of such Residual Interestholder at a bank or other entity having
appropriate facilities therefor, if the Residual Interestholder shall have
provided to the Owner Trustee appropriate written instructions at least five
Business Days prior to such Payment Date or, if not, by check mailed to the
Residual Interestholder at the address of the Residual Interestholder determined
in accordance with Section 9.3.
SECTION 5.4 Accounting and Reports to the Residual Interestholder, the
Internal Revenue Service and Others. The Owner Trustee shall (a) maintain (or
cause to be maintained) the books of the Trust on a calendar year basis on the
cash method of accounting, (b) deliver to the Residual Interestholder, as may be
required by the Code and applicable Treasury Regulations or otherwise, such
information provided to it as may be required to enable the Residual
Interestholder to prepare its federal income tax return, (c) file such tax
returns relating to the Trust and make such elections as may from time to time
be required or appropriate under any applicable state or federal statute or rule
or regulation thereunder so as to maintain the Trust's characterization as, for
so long as the Transferor is the Residual Interestholder, a division or branch
of the Transferor and, if not, as determined by the Transferor for federal
income tax purposes, in all such cases on forms prepared by the Administrator,
(d) cause such tax returns to be signed in the manner required by law and (e)
collect or cause to be collected any withholding
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tax required to be withheld by the Owner Trustee in accordance with Section
5.2(c) with respect to income or distributions to the Residual Interestholder.
SECTION 5.5 Signature on Returns; Tax Matters Partner. Subject to
Section 2.11, the Owner Trustee shall sign on behalf of the Trust any and all
tax returns of the Trust that are prepared and delivered to it for execution by
the Administrator, unless applicable law requires a Residual Interestholder to
sign such documents, in which case such documents shall be signed by the
Transferor. The Transferor shall be the "tax matters partner" of the Trust
pursuant to the Code.
Section 5.6 Xxxxxxxx-Xxxxx Act. Notwithstanding anything to the
contrary herein or in any Basic Document, the Owner Trustee shall not be
required to execute, deliver or certify in accordance with the provisions of the
Xxxxxxxx-Xxxxx Act on behalf of the Trust or any other Person, any periodic
reports filed pursuant to the Exchange Act, or any other documents pursuant to
the Xxxxxxxx-Xxxxx Act, as amended.
ARTICLE VI
THE OWNER TRUSTEE
SECTION 6.1 Duties of Owner Trustee.
(a) The Owner Trustee undertakes to perform such duties, and only such
duties, as are specifically set forth in this Agreement and the other Basic
Documents, including the administration of the Trust in the interest of the
Residual Interestholder, subject to the Basic Documents and in accordance with
the provisions of this Agreement. No implied covenants or obligations shall be
read into this Agreement.
(b) Notwithstanding the foregoing, the Owner Trustee shall be deemed to
have discharged its duties and responsibilities hereunder and under the Basic
Documents to the extent the Administrator has agreed in the Administration
Agreement to perform any act or to discharge any duty of the Owner Trustee
hereunder or under any Basic Document, and the Owner Trustee shall not be liable
for the default or failure of the Administrator to carry out its obligations
under the Administration Agreement.
(c) The Owner Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting on any document (whether in its
original or facsimile form) believed by it to be genuine and to have been signed
or presented by the proper Person. The Owner Trustee shall not be bound to make
any investigation into any fact or matter stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document.
(d) The Owner Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this Section 6.1(d) shall not limit the effect of Section
6.1(a) or (b);
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(ii) the Owner Trustee shall not be liable for any reasonable
error of judgment made in good faith by a Responsible Officer unless it is
proved that the Owner Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Owner 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 4.1, 4.2 or 6.4.
(e) Subject to Sections 5.1 and 5.2, monies received by the Owner
Trustee hereunder need not be segregated in any manner except to the extent
required by law or the Trust Sale and Servicing Agreement and may be deposited
under such general conditions as may be prescribed by law, and the Owner Trustee
shall not be liable for any interest thereon.
(f) The Owner Trustee shall not take any action that (i) is
inconsistent with the purposes of the Trust set forth in Section 2.3 or (ii)
would, to the actual knowledge of a Responsible Officer of the Owner Trustee,
result in the Trust's becoming taxable as a corporation for federal income tax
purposes.
(g) The Residual Interestholder shall not direct the Owner Trustee to
take action that would violate the provisions of this Section 6.1.
SECTION 6.2 Rights of Owner Trustee. The Owner Trustee is authorized
and directed to execute and deliver the Basic Documents and each certificate or
other document attached as an exhibit to or contemplated by the Basic Documents
to which the Trust is to be a party, in such form as the Transferor shall
approve as evidenced conclusively by the Owner Trustee's execution thereof. In
addition to the foregoing, the Owner Trustee is authorized, but shall not be
obligated, to take all actions required of the Trust pursuant to the Basic
Documents. The Owner Trustee is further authorized from time to time to take
such action as the Administrator recommends with respect to the Basic Documents.
SECTION 6.3 Acceptance of Trusts and Duties. (a) Except as otherwise
provided in this Article VI, in accepting the trusts hereby created, The Bank of
New York acts solely as Owner Trustee hereunder and not in its individual
capacity and all Persons having any claim against the Owner Trustee by reason of
the transactions contemplated by this Agreement or any Basic Document shall look
only to the Owner Trust Estate for payment or satisfaction thereof. The Owner
Trustee accepts the trusts hereby created and agrees to perform its duties
hereunder with respect to such trusts but only upon the terms of this Agreement.
The Owner Trustee also agrees to disburse all monies actually received by it
constituting part of the Owner Trust Estate upon the terms of the Basic
Documents and this Agreement. The Owner Trustee shall not be liable or
accountable hereunder or under any Basic Document under any circumstances,
except (i) for its own negligent action, its own negligent failure to act or its
own willful misconduct or (ii) in the case of the inaccuracy of any
representation or warranty contained in Section 6.6 and expressly made by the
Owner Trustee. In particular, but not by way of limitation (and subject to the
exceptions set forth in the preceding sentence):
(b) the Owner Trustee shall at no time have any responsibility or
liability for or with respect to the legality, validity and enforceability of
any Receivable held by the Trust, or the perfection and priority of any security
interest created by any such Receivable in any Vehicle or the maintenance of any
such perfection and priority, or for or with respect to the sufficiency of
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the Owner Trust Estate or its ability to generate the distributions and payments
to be made to Residual Interestholder under this Agreement or to Noteholders
under the Indenture, including, without limitation: the existence and contents
of any such Receivable on any computer or other record thereof; the validity of
the assignment of any such Receivable to the Trust or of any intervening
assignment; the completeness of any such Receivable; the performance or
enforcement of any such Receivable; the compliance by the Transferor or the
Servicer with any warranty or representation made under any Basic Document or in
any related document or the accuracy of any such warranty or representation or
any action of the Administrator, the Indenture Trustee or the Servicer or any
subservicer taken in the name of the Owner Trustee;
(c) the Owner Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in accordance with the instructions of the
Administrator or any Residual Interestholder;
(d) no provision of this Agreement or any Basic Document shall require
the Owner Trustee to expend or risk funds or otherwise incur any financial
liability in the performance of any of its rights or powers hereunder or under
any Basic Document;
(e) under no circumstances shall the Owner Trustee be liable for
indebtedness evidenced by or arising under any of the Basic Documents, including
the principal of and interest on the Notes or any amounts payable with respect
to the Residual Interest;
(f) the Owner Trustee shall not be responsible for or in respect of and
makes no representation as to the validity or sufficiency of any provision of
this Agreement or for the due execution hereof by the Transferor or for the
form, character, genuineness, sufficiency, value or validity of any of the Owner
Trust Estate or for or in respect of the validity or sufficiency of the Basic
Documents, the Notes or of any Receivables held by the Trust or any related
documents, and the Owner Trustee shall in no event assume or incur any
liability, duty or obligation to any Noteholder or to any Residual
Interestholder, other than as expressly provided for herein and in the Basic
Documents;
(g) the Owner Trustee shall not be liable for the default or misconduct
of the Administrator, the Indenture Trustee, the Transferor or the Servicer
under any of the Basic Documents or otherwise, and the Owner Trustee shall have
no obligation or liability to perform the obligations of the Trust under this
Agreement or the Basic Documents that are required to be performed by the
Administrator under the Administration Agreement, the Indenture Trustee under
the Indenture or the Servicer under the Trust Sale and Servicing Agreement; and
(h) the Owner Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement, or to institute, conduct or
defend any litigation under this Agreement or otherwise or in relation to this
Agreement or any Basic Document, at the request, order or direction of any of
the Residual Interestholder, unless such Residual Interestholder have offered to
the Owner Trustee security or indemnity satisfactory to it against the costs,
expenses and liabilities that may be incurred by the Owner Trustee therein or
thereby. The right of the Owner Trustee to perform any discretionary act
enumerated in this Agreement or in any Basic Document shall not be construed as
a duty, and the Owner Trustee shall not be answerable for other than its
negligence or wilful misconduct in the performance of any such act.
SECTION 6.4 Action upon Instruction by Residual Interestholder.
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(a) Subject to Section 4.4, the Residual Interestholder may by written
instruction direct the Owner Trustee in the management of the Trust.
(b) Notwithstanding the foregoing, the Owner Trustee shall not be
required to take any action hereunder or under any Basic Document if the Owner
Trustee shall have reasonably determined, or shall have been advised by counsel,
that such action is likely to result in liability on the part of the Owner
Trustee or is contrary to the terms hereof or of any Basic Document or is
otherwise contrary to law.
(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or any
Basic Document, or is unsure as to the application, intent, interpretation or
meaning of any provision of this Agreement or the Basic Documents, the Owner
Trustee shall promptly give notice (in such form as shall be appropriate under
the circumstances) to the Residual Interestholder requesting instruction as to
the course of action to be adopted, and, to the extent the Owner Trustee acts in
good faith in accordance with any such instruction received, the Owner Trustee
shall not be liable on account of such action to any Person. If the Owner
Trustee shall not have received appropriate instructions within ten days of such
notice (or within such shorter period of time as reasonably may be specified in
such notice or may be necessary under the circumstances) it may, but shall be
under no duty to, take or refrain from taking such action, and the Owner Trustee
shall have no liability to any Person for any such action or inaction.
SECTION 6.5 Furnishing of Documents. The Owner Trustee shall furnish
(a) to the Residual Interestholder, promptly upon receipt of a written request
therefor, duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and any other instruments furnished to the
Owner Trustee under the Basic Documents and (b) to the Noteholders and the
Residual Interestholder, promptly upon receipt of a written request therefor,
copies of the Receivables Purchase Agreement, the Trust Sale and Servicing
Agreement, the Administration Agreement, and this Agreement.
SECTION 6.6 Representations and Warranties of Owner Trustee. The Owner
Trustee hereby represents and warrants to the Transferor, for the benefit of the
Residual Interestholder, that:
(a) It is a banking corporation duly organized, validly existing and in
good standing under the laws of the State of New York.
(b) It has full power, authority and legal right to execute, deliver
and perform this Agreement, and has taken all necessary action to authorize the
execution, delivery and performance by it of this Agreement. The eligibility
requirements set forth in Section 6.13 are satisfied with respect to it.
(c) The execution, delivery and performance by it of this Agreement (i)
shall not violate any provision of any law or regulation governing the banking
and trust powers of the Owner Trustee or to the best of its knowledge without
independent investigation any order, writ, judgment or decree of any court,
arbitrator or governmental authority applicable to the Owner Trustee or any of
its assets, (ii) shall not violate any provision of the corporate charter or
by-laws of the Owner Trustee and (iii) shall not to the best of its knowledge
without independent investigation violate any provision of, or constitute, with
or without notice or lapse of time, a
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default under, or result in the creation or imposition of any lien on any
properties included in the Trust pursuant to the provisions of any mortgage,
indenture, contract, agreement or other undertaking to which it is a party,
which violation, default or lien could reasonably be expected to have a
materially adverse effect on the Owner Trustee's performance or ability to
perform its duties as Owner Trustee under this Agreement or on the transactions
contemplated in this Agreement.
(d) The execution, delivery and performance by the Owner Trustee of
this Agreement shall not require the authorization, consent or approval of, the
giving of notice to, the filing or registration with, or the taking of any other
action in respect of, any Governmental Authority regulating the banking and
corporate trust activities of banks or trust companies in the jurisdiction in
which the Trust was formed.
(e) This Agreement has been duly executed and delivered by the Owner
Trustee and constitutes the legal, valid and binding agreement of the Owner
Trustee, enforceable in accordance with its terms, except as enforceability may
be limited by bankruptcy, insolvency, reorganization, or other similar laws
affecting the enforcement of creditors' rights in general and by general
principles of equity, regardless of whether such enforceability is considered in
a proceeding in equity or at law.
SECTION 6.7 Reliance; Advice of Counsel.
(a) The Owner Trustee shall incur no liability to anyone in acting upon
any signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond or other document or paper (whether in its
original or facsimile form) believed by it to be genuine and believed by it to
be signed by the proper party or parties and need not investigate any fact or
matter in any such document. The Owner Trustee may accept a certified copy of a
resolution of the board of directors or other governing body of any corporate
party as conclusive evidence that such resolution has been duly adopted by such
body and that the same is in full force and effect. As to any fact or matter the
method of the determination of which is not specifically prescribed herein, the
Owner Trustee may for all purposes hereof rely, without any inquiry or
investigation into the factual matters addressed therein, on a certificate,
signed by the president or any vice president or by the treasurer or other
authorized officers of the relevant party, as to such fact or matter, and such
certificate shall constitute full protection to the Owner Trustee for any action
taken or omitted to be taken by it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in
the performance of its duties and obligations under this Agreement or the Basic
Documents, the Owner Trustee: (i) may act directly or through its agents,
attorneys, custodians or nominees pursuant to agreements entered into with any
of them, and the Owner Trustee shall not be liable for the conduct or misconduct
of such agents, attorneys, custodians or nominees if such agents, attorneys,
custodians or nominees shall have been selected by the Owner Trustee with
reasonable care; and (ii) may consult with counsel, accountants and other
skilled professionals to be selected with reasonable care and employed by it.
The Owner Trustee shall not be liable for anything done, suffered or omitted in
good faith by it in accordance with the opinion or advice of any such counsel,
accountants or other such Persons.
SECTION 6.8 Owner Trustee May Own the Residual Interest and Notes. The
Owner Trustee in its individual or any other capacity may become the owner or
pledgee of the
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Residual Interest or Notes and may deal with the Transferor, the Administrator,
the Indenture Trustee and the Servicer in transactions in the same manner as it
would have if it were not the Owner Trustee.
SECTION 6.9 Compensation and Indemnity. The Owner Trustee shall receive
as compensation for its services hereunder such fees as have been separately
agreed upon before the date hereof between the Transferor and the Owner Trustee,
and the Owner Trustee shall be entitled to be reimbursed by the Servicer for its
other expenses hereunder, including the reasonable compensation, expenses and
disbursements of such agents, custodians, nominees, representatives, experts and
counsel as the Owner Trustee may employ in connection with the exercise and
performance of its rights and its duties hereunder. The Servicer shall indemnify
the Owner Trustee and its successors, assigns, agents and servants in accordance
with the provisions of Section 6.4 of the Trust Sale and Servicing Agreement.
The indemnities contained in this Section 6.9 shall survive the resignation or
termination of the Owner Trustee or the termination of this Agreement. Any
amounts paid to the Owner Trustee pursuant to this Section 6.9 shall be deemed
not to be a part of the Owner Trust Estate immediately after such payment.
SECTION 6.10 Replacement of Owner Trustee.
(a) The Owner Trustee may at any time give notice of its intent to
resign and be discharged from the trusts hereby created by giving written notice
thereof to the Administrator; provided that no such resignation shall become
effective, and the Owner Trustee shall not resign, prior to the time set forth
in Section 6.10(c). The Administrator may appoint a successor Owner Trustee by
delivering written instrument, in duplicate, to the resigning Owner Trustee and
the successor Owner Trustee. If no successor Owner Trustee shall have been
appointed and have accepted appointment within 30 days after the giving of such
notice, the resigning Owner Trustee giving such notice may petition at the
expense of the Servicer any court of competent jurisdiction for the appointment
of a successor Owner Trustee. The Administrator shall remove the Owner Trustee
if:
(i) the Owner Trustee shall cease to be eligible in accordance
with the provisions of Section 6.13 and shall fail to resign after
written request therefor by the Administrator;
(ii) the Owner Trustee shall be adjudged bankrupt or
insolvent;
(iii) a receiver or other public officer shall be appointed or
take charge or control of the Owner Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation;
or
(iv) the Owner Trustee shall otherwise be incapable of acting.
(b) If the Owner Trustee resigns or is removed or if a vacancy exists
in the office of Owner Trustee for any reason the Administrator shall promptly
appoint a successor Owner Trustee by written instrument, in duplicate (one copy
of which instrument shall be delivered to the outgoing Owner Trustee so removed
and one copy to the successor Owner Trustee) and shall pay all fees owed to the
outgoing Owner Trustee.
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(c) Any resignation or removal of the Owner Trustee and appointment of
a successor Owner Trustee pursuant to any of the provisions of this Section 6.10
shall not become effective, and no such resignation shall be deemed to have
occurred, until a written acceptance of appointment is delivered by the
successor Owner Trustee to the outgoing Owner Trustee and the Administrator, and
all fees and expenses due to the outgoing Owner Trustee are paid. Any successor
Owner Trustee appointed pursuant to this Section 6.10 shall be eligible to act
in such capacity in accordance with Section 6.13 and, following compliance with
the preceding sentence, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor under this Agreement, with like effect
as if originally named as Owner Trustee. The Administrator shall provide notice
of such resignation or removal of the Owner Trustee to each of the Rating
Agencies.
(d) The predecessor Owner Trustee shall upon payment of its fees and
expenses deliver to the successor Owner Trustee all documents, computer files
and statements and monies held by it under this Agreement. The Administrator and
the predecessor Owner Trustee shall execute and deliver such instruments and do
such other things as may reasonably be required for fully and certainly vesting
and confirming in the successor Owner Trustee all such rights, powers, duties
and obligations.
(e) Upon acceptance of appointment by a successor Owner Trustee
pursuant to this Section 6.10, the Administrator shall mail notice of the
successor of such Owner Trustee to all Residual Interestholder, the Indenture
Trustee, the Noteholders, the Agent and the Rating Agencies.
SECTION 6.11 Merger or Consolidation of Owner Trustee. Any Person into
which the Owner Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Owner Trustee shall be a party, or any Person
succeeding to all or substantially all of the corporate trust business of the
Owner Trustee, shall be the successor of the Owner Trustee hereunder, provided
such Person shall be eligible pursuant to Section 6.13, and without the
execution or filing of any instrument or any further act on the part of any of
the parties hereto; provided, however, that the Owner Trustee shall mail notice
of such merger or consolidation to the Rating Agencies.
SECTION 6.12 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this Agreement, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Owner Trust Estate or any of the Dealers may at the time
be located, the Administrator and the Owner Trustee acting jointly shall have
the power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Owner Trustee to act as co-trustee, jointly with the
Owner Trustee, or as separate trustee or trustees, of all or any part of the
Owner Trust Estate, and to vest in such Person, in such capacity, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 6.12, such powers, duties, obligations, rights and trusts as the
Administrator and the Owner Trustee may consider necessary or desirable. If the
Administrator shall not have joined in such appointment within 15 days after the
receipt by it of a request so to do, the Owner Trustee alone shall have the
power to make such appointment. No co-trustee or separate trustee under this
Agreement shall be required to meet the terms of eligibility as a successor
trustee pursuant to Section 6.13 and no notice of the appointment of any
co-trustee or separate trustee shall be required pursuant to Section 6.10.
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(b) Each 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 Owner Trustee shall be conferred upon and exercised or
performed by the Owner 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 Owner 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 Owner Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to the
Trust 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 Owner Trustee;
(ii) no trustee under this Agreement shall be personally
liable by reason of any act or omission of any other trustee under this
Agreement; and
(iii) the Administrator and the Owner Trustee acting jointly
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 Owner 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 Agreement and
the conditions of this Article. 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 Owner
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Owner Trustee. Each such instrument shall be filed with the Owner
Trustee and a copy thereof given to the Administrator.
(d) Any separate trustee or co-trustee may at any time appoint the
Owner Trustee as 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 Owner Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 6.13 Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times satisfy the requirements of Section 26(a)(1) of the
Investment Company Act. The Owner Trustee shall at all times: (a) be authorized
to exercise corporate trust powers; (b) have an aggregate capital, surplus and
undivided profits of at least $50,000,000 and be subject to supervision or
examination by federal or state authorities; and (c) have (or have a parent
which has) a long-term unsecured debt rating of at least BBB- by Standard &
Poor's and at least Baa3 by Xxxxx'x. If such corporation shall publish reports
of condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purpose of this
Section 6.13, the aggregate capital, surplus and undivided profits of such
corporation shall be deemed to be its aggregate capital, surplus and undivided
17
profits as set forth in its most recent report of condition so published. If at
any time the Owner Trustee shall cease to be eligible in accordance with the
provisions of this Section 6.13, the Owner Trustee shall resign immediately in
the manner and with the effect specified in Section 6.10. Notwithstanding any
other term or provision of this Agreement, the Owner Trustee shall comply at all
times with subsection (a)(4)(i) of Rule 3a-7 of the Investment Company Act. At
all times, at least one trustee of the Trust shall satisfy the requirements of
Section 3807(a) of the Trust Statute.
ARTICLE VII
TERMINATION OF TRUST AGREEMENT
SECTION 7.1 Termination of Trust Agreement.
(a) This Agreement (other than Article VI) and the Trust shall
terminate and be of no further force or effect on the date (the "Trust
Termination Date") upon which occurs the final distribution by the Owner Trustee
of all moneys or other property or proceeds of the Owner Trust Estate in
accordance with the terms of the Indenture, the Transfer and Servicing Agreement
and Article V. The bankruptcy, liquidation, dissolution, death or incapacity of
the Residual Interestholder shall not (x) operate to terminate this Agreement or
the Trust or (y) entitle the Residual Interestholder's legal representatives or
heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of all or any part of the Trust or Owner Trust
Estate or (z) otherwise affect the rights, obligations and liabilities of the
parties hereto.
(b) Upon dissolution of the Issuer, the Administrator shall wind up the
business and affairs of the Issuer as required by Section 3808 of the Trust
Statute. Upon the satisfaction and discharge of the Indenture, and receipt of a
certificate from the Indenture Trustee stating that all Noteholders have been
paid in full and that the Indenture Trustee is aware of no claims remaining
against the Issuer in respect of the Indenture and the Notes, the Administrator,
in the absence of actual knowledge of any other claim against the Issuer, shall
be deemed to have made reasonable provision to pay all claims and obligations
(including conditional, contingent or unmatured obligations) for purposes of
Section 3808(e) of the Trust Statute and upon the written direction of the
Residual Interestholder the Owner Trustee shall cause the Certificate of Trust
to be cancelled by filing a certificate of cancellation with the Delaware
Secretary of State in accordance with the provisions of Section 3810 of the
Trust Statute, at which time the Issuer shall terminate and this Agreement
(other than Section 6.9) shall be of no further force or effect.
(c) Except as provided in Section 6.3(a), none of the Transferor or the
Residual Interestholder shall be entitled to revoke or terminate the Trust.
ARTICLE VIII
AMENDMENTS
SECTION 8.1 Supplements and Amendments. (a) Any term or provision of
this Agreement may be amended by the Transferor, without the consent of the
Indenture Trustee, any Noteholder, the Administrator, any Enhancement Provider,
the Issuer or the Owner Trustee;
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provided that (i) any amendment that materially and adversely affects the
interests of the Noteholders shall require the consent of Noteholders evidencing
not less than a majority of the aggregate outstanding principal amount of the
Outstanding Series of Notes, voting as a single class, and (ii) any amendment
that materially and adversely affects the interests of the Administrator, the
Residual Interestholder, any Enhancement Provider, the Indenture Trustee or the
Owner Trustee shall require the prior written consent of the Persons whose
interests are materially and adversely affected. An amendment shall be deemed
not to materially and adversely affect the interests of the Noteholders if the
Rating Agency Condition is satisfied with respect to such amendment. The consent
of the Administrator, the Residual Interestholder, any Enhancement Provider, the
Indenture Trustee or the Owner Trustee shall be deemed to have been given if the
Servicer does not receive a written objection from such Person within 10
Business Days after a written request for such consent shall have been given.
(b) Notwithstanding the foregoing, no amendment shall (i) reduce the
interest rate or principal amount of any Note, or delay the expected principal
payment date of any Notes without the consent of the Holder of such Note, or
(ii) reduce the percentage of the aggregate outstanding principal amount of the
Outstanding Notes, the Holders of which are required to consent to any matter
without the consent of the Holders of at least the percentage of the aggregate
outstanding principal amount of the Outstanding Notes which were required to
consent to such matter before giving effect to such amendment.
(c) Notwithstanding anything herein to the contrary, any term or
provision of this Agreement may be amended by the parties hereto without the
consent of any of the Noteholders or any other Person to add, modify or
eliminate any provisions as may be necessary or advisable in order to comply
with or obtain more favorable treatment under or with respect to any law or
regulation or any accounting rule or principle (whether now or in the future in
effect); it being a condition to any such amendment that the Rating Agency
Condition shall have been satisfied.
(d) It shall not be necessary for the consent of any Person pursuant to
this Section for such Person to approve the particular form of any proposed
amendment, but it shall be sufficient if such Person consents to the substance
thereof.
(e) Prior to the execution of any amendment to this Agreement, the
Transferor shall provide each Rating Agency with written notice of the substance
of such amendment. No later than 10 Business Days after the execution of any
amendment to this Agreement, the Transferor shall furnish a copy of such
amendment to each Rating Agency, any Enhancement Provider, the Owner Trustee and
the Indenture Trustee.
(f) Prior to the execution of any amendment to this Agreement, the
Owner Trustee shall be entitled to receive and rely upon an opinion of counsel
stating that the execution of such amendment is authorized or permitted by this
Agreement and that all conditions precedent to the execution and delivery of
such amendment have been satisfied. The Owner
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Trustee may, but shall not be obligated to, enter into any such amendment which
affects the Owner Trustee's own rights, duties or immunities under this
Agreement or otherwise.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 No Legal Title to Owner Trust Estate. The Residual
Interestholder shall not have legal title to any part of the Owner Trust Estate.
The Residual Interestholder shall be entitled to receive distributions with
respect to their undivided ownership interest therein only in accordance with
Articles V and VII. No transfer, by operation of law or otherwise, of any right,
title, and interest of the Residual Interestholder to and in their ownership
interest in the Owner Trust Estate shall operate to terminate this Agreement or
the trusts hereunder or entitle any transferee to an accounting or to the
transfer to it of legal title to any part of the Owner Trust Estate.
SECTION 9.2 Limitations on Rights of Others. Except for Sections 2.7,
7.1(c), 7.1(f) and 9.12, the provisions of this Agreement are solely for the
benefit of the Owner Trustee, the Transferor, the Residual Interestholder, the
Administrator and, to the extent expressly provided herein, the Indenture
Trustee and the Noteholders, and nothing in this Agreement, whether express or
implied, shall be construed to give to any other Person any legal or equitable
right, remedy or claim in the Owner Trust Estate or under or in respect of this
Agreement or any covenants, conditions or provisions contained herein.
SECTION 9.3 Notices. All demands, notices and communications upon or to
the Transferor, the Servicer, the Administrator, the Indenture Trustee, the
Owner Trustee or the Rating Agencies or Residual Interestholder under this
Agreement shall be delivered as specified in Appendix B to the Trust Sale and
Servicing Agreement.
SECTION 9.4 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed enforceable to the fullest extent permitted, and if not so
permitted, shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or the rights of the
Residual Interestholder.
SECTION 9.5 Counterparts. This Agreement may be executed in two or more
counterparts (and by different parties on separate counterparts), each of which
shall be an original, but all of which together shall constitute one and the
same instrument.
SECTION 9.6 Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, the
Transferor, the Owner Trustee and Residual Interestholder and their respective
successors and permitted assigns, all as herein provided. Any request, notice,
direction, consent, waiver or other instrument or action by the Residual
Interestholder shall bind the successors and assigns of such Residual
Interestholder.
SECTION 9.7 No Petition Covenant. The Owner Trustee, by entering into
this Agreement, and each Noteholder, Note Owner and the Residual Interestholder,
by accepting the
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benefits of this Agreement, hereby covenant and agree that they shall not at any
time, acquiesce, petition or otherwise invoke or cause (or join with any other
Person in acquiescing, petitioning or otherwise invoking or causing) the
Transferor or the Trust to invoke the process of any court or government
authority for the purpose of commencing or sustaining a case against the
Transferor or the Trust 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 Transferor or the Trust or any
substantial part of the property of the Transferor or the Trust, or ordering the
winding up or liquidation of the affairs of the Transferor or the Trust.
SECTION 9.8 No Recourse. The Residual Interestholder acknowledges that
the Residual Interest represents an undivided ownership interest in the Trust
only and does not represent interests in or obligations of the Transferor, the
Servicer, the Administrator, the Owner Trustee, the Indenture Trustee or any
Affiliate thereof and no recourse, either directly or indirectly, may be had
against such parties or their assets, except as may be expressly set forth or
contemplated in this Agreement or the Basic Documents.
SECTION 9.9 Headings. The headings herein are for purposes of reference
only and shall not affect the meaning or interpretation of any provision hereof.
SECTION 9.10 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF DELAWARE, WITHOUT
REFERENCE TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF OR OF ANY OTHER
JURISDICTION, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 9.11 Indemnification by and Reimbursement of the Servicer. The
Owner Trustee acknowledges and agrees to reimburse the Servicer and its
directors, officers, employees and agents in accordance with Section 3.2 of the
Trust Sale and Servicing Agreement. The Owner Trustee further acknowledges and
accepts the conditions and limitations with respect to the Servicer's obligation
to indemnify, defend and hold the Owner Trustee harmless as set forth in Section
6.4 of the Trust Sale and Servicing Agreement.
SECTION 9.12 Third-Party Beneficiaries. This Agreement will inure to
the benefit of and be binding upon the parties hereto, the Noteholders, the
Residual Interestholder, the Enhancement Providers, the Indenture Trustee and
their respective successors and permitted assigns. Except as otherwise expressly
provided in this Agreement, no other Person will have any right or obligation
hereunder.
SECTION 9.13 Submission to Jurisdiction. Each of the parties hereto
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement, any documents executed and delivered in
connection herewith or for recognition and enforcement of any judgment in
respect thereof, to the non-exclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of America for the Southern
District of New York, and appellate courts from any thereof;
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(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Person at its
address determined in accordance with Appendix B to the Trust Sale and Servicing
Agreement; and
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to xxx
in any other jurisdiction.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed by their respective officers hereunto duly authorized, as of
the day and year first above written.
THE BANK OF NEW YORK,
as Owner Trustee
By: ______________________________
Name:
Title:
VOLKSWAGEN DEALER FINANCE, LLC, as
Transferor
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
Acknowledged and Accepted:
VW CREDIT, INC.,
as Servicer and Administrator
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
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EXHIBIT A
FORM OF
CERTIFICATE OF TRUST
OF
VOLKSWAGEN CREDIT AUTO MASTER OWNER TRUST
THIS CERTIFICATE OF TRUST OF VOLKSWAGEN CREDIT AUTO MASTER OWNER TRUST (the
"Trust"), is being duly executed and filed by The Bank of New York, a New York
banking corporation, and The Bank of New York (Delaware), a Delaware banking
corporation, as trustees, to form a statutory trust under the Delaware Statutory
Trust Act (12 Del. C. Section 3801, et seq.).
Name. The name of the statutory trust being formed hereby is VOLKSWAGEN
CREDIT AUTO MASTER OWNER TRUST.
Delaware Trustee. The name and business address of the trustee of the
Trust in the State of Delaware are The Bank of New York (Delaware), Xxxxx Xxxx
Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000.
Effective Date. This Certificate of Trust shall be effective as of its
filing.
[signature page follows]
A-1
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust in accordance with Section 3811(a)(1) of
the Act.
THE BANK OF NEW YORK
not in its individual capacity,
but solely as owner trustee
By: ___________________________
Name: _____________________
Title: ____________________
THE BANK OF NEW YORK (DELAWARE),
not in its individual capacity,
but solely as co-owner trustee
By: ___________________________
Name: _____________________
Title: ____________________
A-2
