EXHIBIT 10.12
Execution Copy
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XXXXXX LEASING CORPORATION,
Individually, and as the Servicer,
XXXXXX LEASING RECEIVABLES CORP. II,
as the Obligors' Agent,
XXXXXX LEASING RECEIVABLES II LLC,
as the Obligor,
NATIONAL CITY BANK,
as the Agent
and
XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
as the Trustee
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SERIES 2002-A SUPPLEMENT
Dated as of April 1, 2002
to the
MASTER LEASE RECEIVABLES ASSET-BACKED FINANCING FACILITY
AGREEMENT
Dated as of April 1, 2002
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TABLE OF CONTENTS
Page
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ARTICLE I CREATION OF THE SERIES 2002-A NOTES.................................................................... 1
Section 1.01 Designation................................................................................ 1
Section 1.02 Pledge of Series 2002-A Trust Estate....................................................... 1
Section 1.03 Payments................................................................................... 2
Section 1.04 Assignment to a Group; Crossover Amounts................................................... 2
Section 1.05 Authorizations to File Financing Statements................................................ 2
ARTICLE II DEFINITIONS........................................................................................... 2
Section 2.01 Definitions................................................................................ 2
ARTICLE III DISTRIBUTIONS AND STATEMENTS TO SERIES 2002-A NOTEHOLDER; SERIES SPECIFIC COVENANTS.................. 26
Section 3.01 Series 2002-A Accounts..................................................................... 26
Section 3.02 Agent to Send Notice of Amounts Due........................................................ 27
Section 3.03 Distributions from Series 2002-A Facility Account.......................................... 27
Section 3.04 Reporting and Review Requirements.......................................................... 35
Section 3.05 Compliance With Withholding Requirements................................................... 37
Section 3.06 Servicer Advances.......................................................................... 38
Section 3.07 Special Representations, Covenants and Acknowledgements.................................... 38
Section 3.08 Hedging Arrangements....................................................................... 42
Section 3.09 Lockbox Account............................................................................ 43
ARTICLE IV SERIES PRINCIPAL AMOUNT FOR SERIES 2002-A............................................................. 44
Section 4.01 Advances................................................................................... 44
ARTICLE V SERIES EVENTS OF DEFAULT............................................................................... 47
Section 5.01 Series Events of Default................................................................... 47
Section 5.02 Events of Servicer Termination............................................................. 51
Section 5.03 Waiver of Past Defaults.................................................................... 52
Section 5.04 Effects of Servicer Termination............................................................ 52
Section 5.05 Back-up Servicer to Act; Representations and Warranties; Compensation of Back-up Servicer.. 52
Section 5.06 Additional Provisions with Respect to the Back-up Servicer................................. 53
Section 5.07 Certain Matters Relating to the Trustee.................................................... 54
Section 5.08 Resignation and Removal of Trustee......................................................... 54
Section 5.09 Control by Holders......................................................................... 55
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ARTICLE VI PREPAYMENT AND REDEMPTION............................................................................. 55
Section 6.01 Mandatory Prepayment....................................................................... 55
Section 6.02 Optional Redemption........................................................................ 56
Section 6.03 Tender of Series 2002-A Note............................................................... 56
ARTICLE VII MISCELLANEOUS........................................................................................ 57
Section 7.01 Agent Authorized to Act for the Purchasers; Notices........................................ 57
Section 7.02 Ratification of Master Agreement........................................................... 57
Section 7.03 Counterparts............................................................................... 57
Section 7.04 GOVERNING LAW.............................................................................. 57
Section 7.05 Amendments and Waivers..................................................................... 58
Section 7.06 Non-petition Clause........................................................................ 58
Section 7.07 Certain Information........................................................................ 58
Section 7.08 Series Support Provider as Third Party Beneficiary......................................... 58
Section 7.09 Termination................................................................................ 59
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EXHIBITS
Schedule 1 Hedge Counterparties
Exhibit A Form of Series 2002-A Note
Exhibit B [Reserved]
Exhibit C Wire Instructions for Agent
Exhibit D Form of Servicer's Certificate
Exhibit E Forms of Contracts
Exhibit F Certain Information
Exhibit G Form of Pledge Notice
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This Series 2002-A Supplement, (the "Series 2002-A
Supplement") dated as of April 1, 2002, is by and among Xxxxxx Leasing
Corporation, a Delaware corporation, individually (in such capacity "Xxxxxx"),
and as initial servicer (in such capacity, the "Servicer"), Xxxxxx Leasing
Receivables Corp. II, a Nevada corporation ("MLR II"), as the Obligors' Agent,
Xxxxxx Leasing Receivables II LLC, a Nevada limited liability company ("MLR II
LLC"), as the Obligor, National City Bank, a national banking association, as
Agent ("National City", in such capacity, the "Agent"), and Xxxxx Fargo Bank
Minnesota, National Association, a national banking association (the "Trustee").
RECITALS
This Series 2002-A is being executed and delivered pursuant to
Section 13.02 of the Master Lease Receivables Financing Facility Agreement dated
as of April 1, 2002 (as it may be amended, supplemented and otherwise modified
from time to time, the "Master Agreement") among the Servicer, the Obligors'
Agent and the Trustee. In the event that any term or provision contained herein
shall conflict with or be inconsistent with any term or provision contained in
the Master Agreement, the terms and provisions of this Series 2002-A Supplement
shall govern with respect to the Series.
ARTICLE I
CREATION OF THE SERIES 2002-A NOTES
Section 1.01 Designation. There is hereby created a Series of
Notes to be issued pursuant to the Master Agreement and this Series 2002-A
Supplement to be known as "Xxxxxx Lease Receivables Master Asset-Backed
Financing Facility, Series 2002-A Notes." The Obligor with respect to the Series
2002-A Notes is MLR II LLC. The Notes shall be issued as Definitive Notes in
accordance with Sections 5.11 of the Master Agreement.
Section 1.02 Pledge of Series 2002-A Trust Estate. The Obligor
hereby pledges to the Trustee for the benefit of the Series 2002-A Secured
Parties, and the Trustee hereby accepts the pledge of, all right, title and
interest of such Obligor whether now owned and existing or hereafter acquired or
arising in and to (1) each and every Contract now or hereafter listed as a
Series 2002-A Contract on a Pledge Notice delivered to the Trustee, (2) all
Collections, Security Deposits and Related Security associated therewith, (3)
all Servicing Charges with respect thereto, (4) all balances, instruments,
monies, investment property and other securities and investments from time to
time in or acquired with amounts at any time on deposit in each Series 2002-A
Account, and in the Lockbox Account to the extent such amounts in the Lockbox
Account represent Collections or proceeds of Series 2002-A Contracts or earnings
with respect thereto, (5) each Series 2002-A Transfer Agreement Supplement and
all of the Obligor's rights (directly or through the Obligors' Agent) to enforce
the provisions of, and to benefit from the representations, warranties and
covenants made therein and in the Master Transfer Agreement, but only insofar as
such rights relate to the Series 2002-A Trust Estate, (6) all security interests
in the Equipment not owned by the Obligor, and all Equipment owned by the
Obligor, in each case associated with the Series 2002-A Contracts, (7) any
Crossover Amounts allocated to the Series 2002-A Trust Estate from another
Series, (8) all of the Obligor's right, title and interest, if any, in and to
each Hedge Agreement and (9) all proceeds of each of the foregoing, but
excluding the
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following: any obligations of the Obligor, if any, under a Series 2002-A
Transfer Agreement Supplement and Initial Unpaid Amounts (such non-excluded
property, the "Series 2002-A Trust Estate").
Section 1.03 Payments. All amounts to be paid or deposited by
any Person hereunder shall be paid or deposited in accordance with the terms
hereof no later than 12:00 noon (New York City time) on the day when due in
immediately available funds, or by prior day ACH debit (so long as such funds
represent immediately available funds), and if such amounts are payable to the
Series 2002-A Noteholder, they shall be paid as specified in the Note Purchase
Agreement (as defined below), or, if the Series Support Provider is entitled to
such payments, as directed by the Series Support Provider.
Section 1.04 Assignment to a Group; Crossover Amounts. There
is hereby established a Group for purposes of the Master Agreement, which shall
be known as "Group A"; the Series 2002-A Notes are hereby assigned to Group A.
The amounts described in clause nineteenth of Section 3.03(a)(i) and in clause
twentieth of Section 3.03(a)(ii) are hereby designated as the "Crossover
Amounts" for the Series 2002-A Notes for purposes of the Master Agreement.
Section 1.05 Authorizations to File Financing Statements. The
Obligor hereby authorizes the filing of a UCC Financing Statement which
identifies the Obligor as the debtor and the Agent as the Secured Party and
which describes the collateral as "all assets" or "all personal property" of the
Obligor, other than the following: (1) any obligations of the debtor, if any,
under a Series 2002-A Transfer Agreement Supplement and (2) Initial Unpaid
Amounts the Series 2002-A Notes are hereby
ARTICLE II
DEFINITIONS
Section 2.01 Definitions. Whenever used in this Series 2002-A
Supplement and when used in the Master Agreement with respect to the Series
2002-A Notes, the following words and phrases shall have the following meanings,
and the definitions of such terms are applicable to the singular as well as the
plural forms of such terms and to the masculine as well as to the feminine and
neuter genders of such terms. Unless otherwise defined in this Series 2002-A
Supplement, terms defined in the Master Agreement are used herein as therein
defined. For purposes of the Master Agreement, certain definitions are set forth
in Section 3.07(b) hereof.
"31 to 60 Day Delinquency Ratio" means, as of the end of any
Collection Period, the percentage equivalent of a fraction, the numerator of
which is equal to the aggregate Contract Balance Remaining of all Series 2002-A
Contracts as to which any Scheduled Payment (or part thereof in excess of 10% of
such Scheduled Payment) is delinquent 31 or more days, but no Scheduled Payment
(nor part thereof in excess of 10% of such Scheduled Payment) is delinquent more
than 60 days and which is not a Charged-Off Contract as of the end of such
Collection Period, and the denominator of which is the aggregate Contract
Balance Remaining of all Series 2002-A Contracts as of the end of the Collection
Period immediately preceding such Collection Period.
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"61 to 90 Day Delinquency Ratio" means, as of the end of any
Collection Period, the percentage equivalent of a fraction, the numerator of
which is equal to the sum of (x) the aggregate Contract Balance Remaining of all
Series 2002-A Contracts as to which any Scheduled Payment (or part thereof in
excess of 10% of such Scheduled Payment) is delinquent 61 or more days, but no
Scheduled Payment (nor part thereof in excess of 10% of such Scheduled Payment)
is delinquent more than 90 days, and which is not a Charged-Off Contract as of
the end of such Collection Period plus (y) the aggregate Contract Balance
Remaining of all Series 2002-A Contracts which were Restructured during such
Collection Period and the two preceding Collection Periods, and the denominator
of which is the aggregate Contract Balance Remaining of all Series 2002-A
Contracts as of (i) during the Revolving Period, the end of the second preceding
Collection Period and (ii) during the Amortization Period, the beginning of such
Collection Period.
"91 Plus Day Delinquency Ratio" means, as of the end of any
Collection Period, the percentage equivalent of a fraction, the numerator of
which is equal to the aggregate Contract Balance Remaining of all Series 2002-A
Contracts as to which any Scheduled Payment (or part thereof in excess of 10% of
such Scheduled Payment) is delinquent 91 or more days, and which is not a
Charged-Off Contract as of the end of such Collection Period, and the
denominator of which is the aggregate Contract Balance Remaining of all Series
2002-A Contracts (i) during the Revolving Period, as of the end of the third
preceding Collection Period and (ii) during the Amortization Period, as of the
beginning of such Collection Period.
"31 to 60 Day Portfolio Delinquency Rate" means, as of the end
of any Collection Period, the percentage equivalent of a fraction, the numerator
of which is equal to the aggregate Contract Balance Remaining of all leases
included in the Servicer's servicing portfolio as to which any Scheduled Payment
(or part thereof in excess of 10% of such Scheduled Payment) is delinquent 31 or
more days, but no Scheduled Payment (or part thereof in excess of 10% of such
Scheduled Payment) is more than 60 days delinquent (and which would not be
"Charged-Off Contracts" if treated as "Contracts") as of the end of such
Collection Period, and the denominator of which is the aggregate Contract
Balance Remaining of all leases included in the Servicer's servicing portfolio
as of the end of such Collection Period.
"61 to 90 Day Portfolio Delinquency Rate" means, as of the end
of any Collection Period, the percentage equivalent of a fraction, the numerator
of which is equal to the aggregate Contract Balance Remaining on all leases
included in the Servicer's servicing portfolio as to which any Scheduled Payment
(or part thereof in excess of 10% of such Scheduled Payment) is delinquent 61 or
more days, but no Scheduled Payment (or part thereof in excess of 10% of such
Scheduled Payment) is more than 90 days delinquent (and which would not be
Charged-Off Contracts if treated as "Contracts") as of the end of such
Collection Period, and the denominator of which is the aggregate Contract
Balance Remaining of all leases included in the Servicer's servicing portfolio
as of the end of such Collection Period.
"91 Plus Day Portfolio Delinquency Rate" means, as of the end
of any Collection Period, the percentage equivalent of a fraction, the numerator
of which is equal to the aggregate Contract Balance Remaining of all leases
included in the Servicer's servicing portfolio as to which any Scheduled Payment
(or part thereof in excess of 10% of such Scheduled Payment) is 91 or more days
delinquent (and which would not be "Charged-Off Contracts" if treated as
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"Contracts"), as of the end of such Collection Period, and the denominator of
which is the aggregate Contract Balance Remaining of all leases included in the
Servicer's servicing portfolio as of the end of such Collection Period.
"Advance " has the meaning set forth in Section 4.01(b).
"Advance Amount" means, as of any Pledge Date:
(a) with respect to any Pledge of any Series 2002-A
Contracts under Section 4.01(b) hereof, the excess, if any, of (x) the Pro Forma
Borrowing Base over (y) the Net Investment immediately prior to such Pledge;
(b) with respect to any Pledge of any Series 2002-A
Contracts under Section 4.01(e) hereof, the excess, if any, of (x) the Pro Forma
Borrowing Base over (y) the Borrowing Base as of the immediately preceding
Calculation Date; and
(c) with respect to any Pledge under Section 4.01(f)
hereof, $0.
"Agent" means National City, in its capacity as agent for the
Purchasers pursuant to Article VIII of the Note Purchase Agreement and any
successor Agent appointed pursuant thereto.
"Amortization Period" means the period commencing on the
Termination Date, and ending on the earlier to occur of (i) the final
disposition of, and application of the proceeds of, the Series 2002-A Trust
Estate and (ii) the payment in full of all Series Trustee Secured Obligations.
"Applicable Discount Rate" means with respect to any Series
2002-A Contract, the sum of:
(i) the Fee Rate; and
(ii) the Weighted Average Hedge Rates under the
Hedge Agreements which apply to such Series
2002-A Contract, determined as of the
related Pledge Date.
"Applicable Hedge Agreement" means, with respect to any
Interest Period, any Hedge Agreement under which payment is scheduled to be made
(in the absence of any "netting") on the Settlement Date relating to such
Interest Period.
"Applicable Hedge Rate" means, for any Applicable Hedge
Agreement and Interest Period (i) if the Hedge Counterparty on such Applicable
Hedge Agreement is a Person other than National City, the Series 2002-A Base
Insured Note Interest Rate for the related Interest Period and (ii) if the Hedge
Counterparty on such Applicable Hedge Agreement is National City, the sum of (x)
Hedge Rate for such Applicable Hedge Agreement plus (y) the applicable LIBO
Margin.
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"Applicable Trigger Charged-Off Ratio" means, as of any date
of determination:
(x) if the Net Investment as of such date of
determination is less than $25,000,000,
8.0%;
(y) if the Net Investment as of such date of
determination is $25,000,000 or more but
less than $50,000,000, 6.0%; and
(z) if the Net Investment as of such date of
determination is $50,000,000 or more, 4.0%.
"Average Charged-Off Ratio" means, as of any day of
determination, the arithmetic average of the Charged-Off Ratio as of the last
day of each of the three preceding Collection Periods (or such lesser number of
Collection Periods as shall have occurred since the Series Closing Date).
"Back-Up Servicer Fee" means the monthly fee payable to the
Back-Up Servicer on each Settlement Date, which shall be the greater of (a)
one-twelfth of four basis points per annum times the aggregate Contract
Principal Balance of the Series 2002-A Contracts as of the end of the preceding
Collection Period and (b) $1,500. This fee is only to be paid to the Back-up
Servicer for so long as it is acting as such and is not payable during such time
as the Back-up Servicer acts as the successor Servicer.
"Base LIBO Rate" for any Interest Period (or portion thereof
for which a Purchaser initially funds an investment in the Series 2002-A Notes
other than by issuing Commercial Paper) with respect to the Series 2002-A Notes
shall mean an interest rate per annum equal to:
(i) the posted rate for 30-day deposits (or such
lesser period of time as determined by the
Agent to be appropriate, in the event that
the LIBO Rate is to be determined for a
portion of an Interest Period) in United
States Dollars appearing on Telerate page
3750 as of 11:00 a.m. (London time) on the
Business Day which is the second Business
Day immediately preceding the first day of
the applicable Interest Period (or the first
day of such portion of an Interest Period);
or
(ii) if no such rate appears on Telerate page
3750 at such time and day, then the LIBO
Rate shall be determined by National City at
its office in Philadelphia, Pennsylvania as
its rate (each such determination, absent
manifest error, to be conclusive and binding
on all parties hereto and their assignees)
at which 30-day deposits (or such lessor
period of time as determined by the Agent to
be appropriate, in the event that the LIBO
rate is to be determined for a portion of an
Interest Period ) in United States Dollars
are being, having been, or would be offered
or quoted by National City to major banks in
the applicable interbank market for
Euordollar deposits at or about 11:00 a.m.
(Philadelphia, Pennsylvania time)
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on such day for a period equal to such
Interest Period (or portion thereof).
"Borrowing Base" means, as of any date of determination, the
sum of:
(x) the lesser of:
(i) the product of (a) the sum of (i) the
aggregate Contract Principal Balance of all
Series 2002-A Contracts which are Eligible
Contracts and which are not Charged-Off
Contracts as of such date plus (ii) the
portion of Series 2002-A Available Funds
then on deposit in the Series 2002-A
Facility Account which represents funds
required to be applied to the amortization
of the Series 2002-A Note Balance for the
related Collection Period minus (iii) the
Overconcentration Amount as of such date
times (b) the Purchase Price Percentage as
of such date of determination; and
(ii) the sum of (a) the aggregate Contract
Principal Balance of all Series 2002-A
Contracts which are Eligible Contracts and
which are not Charged-Off Contracts as of
such date plus (b) the portion of Series
2002-A Available Funds then on deposit in
the Series 2002-A Facility Account which
represents funds required to be applied to
the amortization of the Series 2002-A Note
Balance for the related Collection Period,
minus (c) the Overconcentration Amount as of
such date minus (d) the Credit Support Floor
Amount;
and
(y) the aggregate Residual Advance Amount, if any, with
respect to such date of determination.
"Breakage Costs" means, for each Owner for each funding
period, to the extent that an Owner is funding the maintenance of its investment
in the Series 2002-A Notes during such funding period through the issuance of
Commercial Paper or at the LIBO Rate, during which such investment is reduced
(in whole or in part) prior to the end of the period for which it was originally
scheduled to remain outstanding (the amount of such reduction in such investment
being referred to as the "Allocated Amount"), the excess of (a) the discount or
interest that would have accrued on the Allocated Amount during the remainder of
such funding period if such reduction had not occurred over (b) the income, if
any, scheduled to be received by such Owner from investing the Allocated Amount
for the remainder of such funding period in a commercially reasonable manner.
"Broker" means (i) the Person (excluding the Transferor and
any equipment vendor) that arranges for the lease of an item of Equipment to a
User pursuant to a Contract between the Transferor and the User of such
Equipment, or (ii) any Person from whom the Transferor purchased a Contract in
respect of which the Transferor is not an original party (other than pursuant to
a vendor program); provided, however, that the term "Broker" shall not include
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any Person who serves as an intermediary between the Transferor and any vendor
or manufacturer with whom the Transferor has a program agreement and Xxxxxx has
made the credit decision and is the initial lessor (except with respect to the
Provident Capital Group programs, where Provident Capital Group or an Affiliate
thereof may be the initial lessor).
"Broker Concentration Amount" means, as of any date of
determination, the excess, if any, of (x) the aggregate Contract Principal
Balance of all Series 2002-A Contracts originated by, or purchased from Brokers
over (y) thirty percent (30%) of the aggregate Contract Principal Balance of all
Series 2002-A Contracts which are Eligible Contracts at such time.
"Broker/Vendor Concentration Amount" means, as of any date of
determination, for each Broker or vendor (including Provident Capital Group)
that has originated or sold any Series 2002-A Contracts for or to the
Transferor, the excess, if any, of (x) the aggregate Contract Principal Balance
of all Series 2002-A Contracts originated by, or purchased from such Broker or
vendor over (y) five percent (5%) of the Net Investment at such time.
"Business Day" shall mean any day that is a Business Day under
the Master Agreement which is also a day on which banks are not authorized or
required to close in New York, New York, Philadelphia, Pennsylvania, Cleveland,
Ohio or in Minneapolis, Minnesota and on which The Depository Trust Company of
New York is open for business.
"Cap Agreement" means a Hedge Agreement under which the Hedge
Counterparty will only make payments when and if the Base LIBO Rate exceeds a
specified level, and which provides for no payment by the Trustee other than a
single upfront payment to be paid for by a party not to be the Trustee.
"Charged-Off Ratio" means, as of the end of any Collection
Period, twelve (12) times the percentage equivalent of a fraction the numerator
of which is equal to the excess of (x) the aggregate Contract Principal Balance
as of the end of such Collection Period of, plus any related Servicer Advances
made with respect to, all Series 2002-A Contracts which became Charged-Off
Contracts during such Collection Period, plus the aggregate Contract Principal
Balance of any Delinquent Contracts which were removed from the Series 2002-A
Trust Estate in exchange for Substitute Contracts during such Collection Period,
over (y) the sum of all Recoveries received during such Collection Period with
respect to the Series 2002-A Contracts, and the denominator of which is equal to
the aggregate Contract Principal Balance of all Series 2002-A Contracts as of
(i) during the Revolving Period, the end of the third preceding Collection
Period and (ii) during the Amortization Period, the beginning of such Collection
Period.
"Collateral Administration Agreement" shall mean the
Collateral Administration Agreement, dated as of April 1, 2002, among the
Obligor, the Obligors' Agent, the Transferor, the Servicer, the Trustee and the
Agent, as the same may be amended, restated, supplemented or otherwise modified
from time to time hereafter.
"Commercial Paper" means any note, draft, xxxx of exchange, or
bankers' acceptance which has a maturity at the time of issuance not exceeding
nine months, exclusive of days of grace, or any renewal thereof the maturity of
which is likewise limited.
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"Committed Financing Facility" means any committed financing
available to Xxxxxx or its affiliates which may be drawn upon (subject to any
conditions specified thereon) from time to time for the warehousing or financing
of collateral or for general corporate purposes, but excluding any subordinated
debt.
"CP Margin" has the meaning ascribed thereto in the Fee
Letter.
"Credit Support Amount" means, as of any date of
determination, the excess of (x) the aggregate Contract Principal Balance of all
Series 2002-A Contracts which are not Charged-Off Contracts as of such date of
determination, minus the Overconcentration Amount as of such date over (y) the
Net Investment as of such date.
"Credit Support Floor Amount" means, as of any date of
determination, the greater of (x) $2,500,000 and (y) 25% of the Maximum
Applicable Credit Support.
"Crossover Amounts" has the meaning set forth in Section 1.04
hereof.
"Debt-to-Equity Ratio" means, as of any date of determination,
and with respect to Xxxxxx and its consolidated subsidiaries, Total Debt as a
multiple of Tangible Net Worth; "Total Debt" shall reflect all liabilities
(excluding deferred taxes) under GAAP, provided that "Total Debt" shall include
all liabilities (other than deferred taxes), whether "on-balance sheet" or
"off-balance sheet" for GAAP, as well as (a) the principal portion of any
subordinated debt which is payable within six months of such date of
determination and (b) all preferred stock which has a put right or other similar
right within six months of such date of determination.
"EBITDA" means for any period, for Xxxxxx and its consolidated
subsidiaries, the sum of net income for such period plus (i) income taxes, (ii)
Interest Expense and (iii) depreciation and amortization, all of which is to be
computed over the previous twelve calendar months.
"Eligible Bank Account" means a segregated account, which may
be an account maintained with the Trustee, which is either (a) maintained with a
depository institution or trust company whose long-term unsecured debt
obligations are rated at least BBB+ by S&P and Baa1 by Xxxxx'x and whose
short-term unsecured obligations are rated at least A-1 by S&P and P-1 by
Xxxxx'x; or (b) a trust account or similar account maintained with a federally
or state chartered depository institution subject to regulations regarding
fiduciary funds on deposit substantially similar to 12 C.F.R. 9.10(b).
"Eligible Contract" means a Series 2002-A Contract which:
(a) (i) is with a User whose billing address is in the
United States or its territories and possessions and requires (A) all
payments under such Contract to be made in United States dollars and
(B) all Equipment relating to such Contract be held in the United
States and (ii) is with a User who, if a natural person, is a resident
of the United States with legal capacity to contract or, if a
corporation or other business organization, is organized under the laws
of the United States, or any political subdivision thereof and has its
chief executive office in the United States;
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(b) has not had any of its terms, conditions or
provisions amended, modified or waived other than in compliance with
the Credit and Collection Policy and has not been Restructured at any
time;
(c) constitutes "chattel paper" within the meaning of
Sections 9-102(11) and 9-102(78) of the UCC of all applicable
jurisdictions and there is only one original of such Contract (bearing
the original signature of an employee of Xxxxxx, together with the
facsimile copy of the signature of the User or the original signature
of the User) that constitutes "chattel paper" for purposes of the
Delaware, New York, New Jersey and Nevada UCC;
(d) was originated in accordance with, and does not
contravene, any applicable federal, state and local laws, and
regulations thereunder (including, without limitation, any law, rule
and regulation relating to truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection
practices and privacy) and with respect to which no part of such
Contract is in violation of any applicable law, rule or regulation;
(e) was originated or purchased without recourse in
compliance with, and satisfies in all material respects all applicable
requirements of the Credit and Collection Policy;
(f) is not a Government Contract which has the United
States or any of its agencies or instrumentalities as the User;
(g) as of the related Pledge Date, is not a Delinquent
Contract;
(h) (i) contains "hell or high water" provisions
requiring the related User to assume all risk of loss or malfunction of
the related Equipment, (ii) requires the related User to pay all
expenses in connection with the maintenance, repair, insurance and
taxes, together with all other ancillary costs with respect to the
related Equipment and (iii) makes the related User absolutely and
unconditionally liable for all payments required to be made thereunder,
without any right of set-off, counterclaim, or other defense (other
than the discharge in bankruptcy of such related User) and without any
right to prepay the Contract or any contingencies tied to the Obligor;
(i) is payable in substantially level monthly or
quarterly rental payments calculated at a fixed yield;
(j) creates a valid and enforceable security interest
(or, in the case of a "true lease", a valid ownership interest) in
favor of the Transferor in the related Equipment, and such Equipment
has not been the subject of loss or damage;
(k) together with the Equipment relating thereto, was the
subject of a valid sale and assignment from the Transferor with good
title transferred to the Obligor thereby and is free and clear of any
Liens, other than the claims arising pursuant to this Series 2002-A
Supplement and Master Agreement and the other documents relating to
this transaction; provided, however, that nothing in this paragraph (k)
shall prevent or be
9
deemed to prohibit the Transferor from suffering to exist upon such
Contract any Lien for federal, state, municipal or other local taxes if
such taxes shall not at the time be due and payable or if the
Transferor shall concurrently be contesting the validity thereof in
good faith by appropriate proceedings that have stayed enforcement
thereof and shall have set aside on its books adequate reserves with
respect thereto,
(l) is in full force and effect in accordance with its
terms and contains enforceable provisions such that the right and
remedies of the holder thereof shall be adequate for realization
against the Equipment, if any, thereunder and of the benefits of any
security granted thereunder;
(m) does not provide for the substitution, exchange, or
addition of any other items of Equipment pursuant to such Contract
which would result in any reduction or extension of payments due
thereunder;
(n) by its terms is due and payable in full on or within
72 months of the applicable Pledge Date;
(o) arises under a Contract in substantially the form of
one of the form contracts set forth in Exhibit E hereto or otherwise
approved by the Agent and the Series Support Provider in writing, which
is in full force and effect and constitutes the legal, valid and
binding obligation of the related User enforceable against such User in
accordance with its terms subject to no offset, counterclaim or other
defense (other than the discharge in bankruptcy of such User);
(p) (i) does not preclude the pledge, transfer or
assignment thereof, (ii) does not require the consent of the User to
the pledge, assignment or transfer thereof, and (iii) does not contain
a confidentiality provision that purports to restrict the ability of
the Trustee to exercise its rights under the Series 2002-A Related
Documents with respect thereto, including, without limitation, its
right to review the Contract;
(q) was (i) originated or purchased by the Transferor in
the ordinary course of its business, (ii) approved and purchased or
funded in the ordinary course of the Transferor's business, and (iii)
originated by an Originator eligible under the Credit and Collection
Policy;
(r) is with a User that, as of the Contract's Pledge
Date, is not the User with respect to any Charged-Off Contract, and is
not and has never been a Charged-Off Contract;
(s) the inclusion of which in the Series 2002-A Trust
Estate would not require the registration of the Obligor or of the
Series 2002-A Trust Estate as an "investment company" under the
Investment Company Act of 1940, as amended;
(t) the addition of which to the Series 2002-A Trust
Estate would not result in the Weighted Average Life to exceed 2.5
years;
10
(u) if the Original Equipment Cost of the Equipment
related to such Contract is valued at greater than $25,000, is secured
by a first priority perfected security interest in such Equipment in
favor of Xxxxxx;
(v) relates to Equipment which (i) is not a vehicle or
other type of equipment which is subject to a certificate of title or
other similar titling statute and (ii) to the best of the Servicer's
knowledge, has not suffered any damage or loss;
(w) had a Contract Principal Balance upon origination
which was less than or equal to $150,000;
(x) was not selected by the Transferor from the
Transferor's pool of leases in a manner adverse to the Series 2002-A
Noteholders or the Series Support Provider;
(y) arises under a lease or financing contract, is not
currently under any sub-lease agreement, and does not permit any
sub-leasing of the related Equipment;
(z) is one as to which all parties to the Contract have
satisfied all obligations to be required to be fulfilled by such
parties as of the related Pledge Date;
(aa) is, and has been, at all times, a legal, valid and
binding payment obligation of the User, enforceable in accordance with
its terms;
(bb) the User of which is not an Affiliate of the
Transferor, the Servicer or any Obligor;
(cc) has been accounted for on the Transferor's books as
sold to the Obligor;
(dd) is not subject to, nor with respect to which has
there been asserted, any litigation or any right to rescission, set
off, counterclaim or other defense of the User;
(ee) as to which the related User has been directed to
make payment only to the Lockbox Account at the Lockbox Bank;
(ff) as to which the related Equipment has been delivered
to, and accepted by, the related User;
(gg) if such Contract is a "true lease", the Equipment is
owned by the Obligor free and clear of all other liens; and
(hh) if such Contract was originated by a third party and
acquired by the Transferor, and if the Original Equipment cost related
thereto exceeded $25,000, a UCC-1 financing statement was filed against
the related User in the appropriate jurisdiction by the originator
thereof and a UCC-3 assignment was filed assigning the original UCC-1
to the Transferor.
"Equipment Concentration Amount" means, as of any date of
determination, the sum of:
11
(i) for the Equipment Type "Computers and Peripherals",
the excess, if any, of (x) the aggregate Contract
Principal Balance of all Series 2002-A Contracts with
respect to which the related Equipment is such
Equipment Type over (y) twenty-five percent (25%) of
the Net Investment at such time;
(ii) for the Equipment Type "Software", the excess, if
any, of (x) the aggregate Contract Principal Balance
of all Series 2002-A Contracts with respect to which
the related Equipment is such Equipment Type over (y)
ten percent (10%) of the Net Investment at such time;
(iii) for the Equipment Type "Surveillance Systems", the
excess, if any, of (x) the aggregate Contract
Principal Balance of all Series 2002-A Contracts with
respect to which the related Equipment is such
Equipment Type over (y) ten percent (10%) of the Net
Investment at such time;
(iv) for the Equipment Type "Telecommunications
Equipment", the excess, if any, of (x) the aggregate
Contract Principal Balance of all Series 2002-A
Contracts with respect to which the related Equipment
is such Equipment Type over (y) twenty percent (20%)
of the Net Investment at such time;
(v) for the Equipment Type "Office Equipment", the
excess, if any, of (x) the aggregate Contract
Principal Balance of all Series 2002-A Contracts with
respect to which the related Equipment is such
Equipment Type over (y) thirty percent (30%) of the
Net Investment at such time; and
(vi) for each other Equipment Type, the excess, if any, of
(x) the aggregate Contract Principal Balance of all
Series 2002-A Contracts with respect to which the
related Equipment is such Equipment Type, over (y)
fifteen percent (15%) of the Net Investment at such
time.
"Equipment Type" means, with respect to each Series 2002-A
Contract, the related Equipment "type", as indicated on the Servicer's servicing
system with respect to such Series 2002-A Contract.
"Federal Funds Rate" means for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the overnight federal funds rates as quoted by National City and
confirmed in Federal Reserve Board Statistical Release H.15(519) or any
successor or substitute publication selected by National City (or, if such day
is not a Business Day, for the next preceding Business Day), or, if, for any
reason, such rate is not available on any day, the rate determined, in the sole
opinion of National City, to be the rate at which federal funds are being
offered for sale in the national federal funds market at 9:00 a.m. Philadelphia,
Pennsylvania time.
"Fee Letter" means that certain letter agreement dated as of
April 1, 2002 by and among the Obligor, the Obligors' Agent and the Agent, as it
may be amended or modified and in effect from time to time.
12
"Fee Rate" means the aggregate of the rates at which fees are
payable in connection with Series 2002-A (i.e., LIBO Margin (as set forth in the
Fee Letter), the Servicing Fee of 1.00%, the Trustee's Fee of 0.02%, the Back-Up
Servicer's Fee of 0.04%, and the rate at which the premiums due to the Series
Support Provider are calculated, as set forth in the Premium Letter).
"Floor Shortfall Amount" means, as of any date of
determination, the excess, if any, of (x) the Credit Support Floor Amount over
(y) the Credit Support Amount, in each case as of such date.
"Government Concentration Amount" means, as of any date of
determination, the excess of (x) the aggregate Contract Principal Balance of all
Series 2002-A Contracts which are Government Contracts having a state,
municipality or agency or instrumental of a state or a municipality as the User
over (y) two percent (2.0%) of the Net Investment at such time.
"Hedge Agreement" means an interest rate cap or swap agreement
between the Trustee and a Hedge Counterparty satisfying the conditions specified
in Section 3.08 hereof.
"Hedge Counterparty" means either (i) a Person reasonably
acceptable to the Agent and the Series Support Provider (it being stipulated
that each party listed on Schedule 1 hereto is acceptable) and having long term
unsecured debt obligations rated at least AA- by S&P and Aa3 by Xxxxx'x, (ii)
National City for so long as its long term unsecured debt obligations are rated
at least A by S&P and A1 by Xxxxx'x.
"Hedge Rate" means, with respect to any Hedge Agreement and
the Series 2002-A Contracts assigned thereto, (a) if such Hedge Agreement is a
Cap Agreement, the fixed rate per annum which the Base LIBO Rate must exceed to
result in payments made thereunder by the Hedge Counterparty to the Series
2002-A Facility Account, and (b) if such Hedge Agreement is an interest rate
swap agreement, the fixed rate per annum which is applied to the notional amount
of such Hedge Agreement to calculate the payments to be made by the Trustee
thereunder to the Hedge Counterparty.
"Increased Servicer Fee" means as of any Settlement Date, an
amount not to exceed 0.25% of the aggregate Contract Principal Balance of the
Series 2002-A Contracts as of the first day of the prior Collection Period,
payable on each Settlement Date to any successor Servicer in accordance with
Section 9.02(b) of the Master Agreement as additional compensation in excess of
the Servicing Fee for the performance of its duties hereunder and under the
Master Agreement.
"Independent Public Accountants" shall mean, with respect to
Xxxxxx, any "Big 4" accounting firm, or other accounting firm reasonably
acceptable to the Series Controlling Party.
"Insurance Agreement" means the Insurance and Indemnity
Agreement dated April 1, 2002, among Xxxxxx, the Obligor, the Obligors' Agent,
the Agent, the Series Support Provider and the Trustee.
13
"Insured Monthly Interest" means, with respect to any
Settlement Date, interest due in respect of the Series 2002-A Notes calculated
at the Series 2002-A Insured Note Interest Rate for the preceding Interest
Period.
"Interest Coverage Ratio" means, as of any date of
determination, and with respect to Xxxxxx and its consolidated subsidiaries,
EBITDA as a multiple of Interest Expense.
"Interest Expense" means for any period, for Xxxxxx and its
consolidated subsidiaries, the sum (without duplication) of all
interest in respect of Indebtedness (including interest on the Series
2002-A Notes and all similar transactions, and the interest component
of any payments in respect of capitalized lease obligations) accrued or
capitalized during such period (whether or not actually paid during
such period); plus the net amount payable under Hedge Agreements
(whether or not actually paid or received during such period, all of
which is to be computed over the previous twelve months).
"Interest Period" means, with respect to any Settlement Date,
the period from and including the prior Settlement Date (or, in the case of the
first Settlement Date, from and including the Series Closing Date) to but
excluding such Settlement Date.
"LIBO Margin" has the meaning ascribed thereto in the Fee
Letter.
"LIBO Rate" for any Interest Period (or portion thereof for
which an Owner initially funds an investment in the Series 2002-A Notes other
than by issuing Commercial Paper) with respect to the Series 2002-A Notes shall
mean the applicable Base LIBO Rate divided by the percentage equal to the
difference of one minus the LIBOR Reserve Percentage applicable during such
Interest Period (or portion thereof), if any.
"LIBO Rate Disruption Event" shall mean, for any Owner with
respect to any Series 2002-A Note, for any Interest Period or portion thereof,
any of the following: (a) a determination by such Owner that it would be
contrary to law or to the directive of any central bank or other governmental
authority to obtain United States dollars in the London interbank market to fund
its investment in such Series 2002-A Note for such Interest Period or portion
thereof, (b) prime banks in the London interbank market are not then generally
quoting a Base LIBO Rate or not then quoting a Base LIBO Rate to Persons such as
such Owner, or (c) the inability of such Owner by reason of circumstances
affecting the London interbank market generally, to obtain U.S. Dollars in such
market to fund its investment in such Series 2002-A Note for such Interest
Period or portion thereof.
"LIBOR Reserve Percentage" shall mean, relative to each
Interest Period or portion thereof, a percentage (expressed as a decimal) equal
to the daily average during such Interest Period or portion thereof of the
percentages in effect on each day of such Interest Period or portion thereof, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor), for determining the maximum reserve requirements applicable to
"Eurocurrency liabilities" pursuant to Regulation D or any other applicable
regulation of the Board of Governors of the Federal Reserve System which
prescribes reserve requirements applicable to "Eurocurrency liabilities" as
currently defined in Regulation D.
14
"Liquidity Agreement" shall mean the liquidity agreement dated
as of April 1, 2002 among North Coast Funding LLC, the liquidity banks named
therein, and National City, as the liquidity agent, as amended from time to
time.
"Liquidity Provider" shall mean a financial institution to
whom the Obligors' Agent shall have consented (which consent shall not be
unreasonably withheld) providing liquidity support to or for the account of any
Purchaser, whether by an extension of credit, the acquisition of an interest in
the Series 2002-A Notes, or otherwise, or having a commitment to provide such
support under a liquidity agreement which relates to this Supplement.
"Lockbox Account" means the account no. 2000004737584
established and maintained by the Lockbox Bank for the purpose of receiving
payments on the Series 2002-A Contracts.
"Lockbox Bank" means First Union National Bank or any other
commercial bank acceptable to the Series Support Provider.
"London Banking Day" means a day on which commercial banks are
open for business (including dealers in foreign exchange and foreign currency
deposits) in London, England.
"Market Disruption Event" means, with respect to any calendar
month, an increase in the level of spreads to the applicable United States
Treasury Obligation for "AAA"- rated small ticket lease asset-backed securities
which are insured by the Series Support Provider by more than 75% over such
spreads prevailing during the prior calendar month, as reasonably determined by
the Series Support Provider at the request of Xxxxxx.
"Xxxxxx" means Xxxxxx Leasing Corporation, a Delaware
corporation.
"Master Agreement" has the meaning set forth in the Recitals
hereto.
"Master Transfer Agreement" means that certain Master Lease
Acquisition and Sale Agreement dated as of April 1, 2002 among Xxxxxx, the
Obligors' Agent and the Obligors set forth therein as parties thereto from time
to time, as such agreement may be amended, supplemented or modified from time to
time.
"Maximum Applicable Credit Support" means:
(i) prior to the date of the first Take-Out, the
largest Credit Support Amount on any day
occurring since the Series Closing Date; and
(ii) on and after the date of the first Take-Out,
the largest Credit Support Amount on any day
occurring since the most recent Take-Out.
"Maximum Series Limit" means:
15
(i) during the period from the Series Closing Date to
April 9, 2003, $75,000,000; and
(ii) during the period from April 10, 2003 to April 9,
2004, upon the prior written consent of the Series Support Provider and the
Agent, $100,000,000 (or, if such consent is not forthcoming, then $75,000,000).
"Monthly Interest" means, with respect to any Settlement Date,
interest due in respect of the Series 2002-A Notes calculated at the Series
2002-A Note Interest Rate for the preceding Interest Period (which amount shall
include, in the event the aggregate principal portion of the respective
investments of each Purchaser exceeded the Series 2002-A Note Balance after
giving effect to all distributions on the prior Settlement Date, an amount equal
to interest accrued on such excess at the rate described in paragraph (a) of the
definition of Series 2002-A Note Interest Rate).
"National City" means National City Bank, a national banking
association.
"Net Investment" means as of any date of determination the sum
of (i) the Series 2002-A Note Balance as of such date plus (ii) accrued and
unpaid interest at the Series 2002-A Note Interest Rate through such date plus
(iii) any Noteholder's Carryover Interest as of such date.
"Note Purchase Agreement" shall mean the Note Purchase
Agreement dated as of April 1, 2002, among the Obligor, the Obligors' Agent, the
Purchasers and the Agent, as the same may be amended, restated, supplemented or
otherwise modified from time to time hereafter.
"Noteholder's Carryover Interest" means, as of any date of
determination, the amount of Monthly Interest due on any prior Settlement Date
but not paid, plus interest thereon through such date from such prior Settlement
Date, calculated using the Series 2002-A Note Interest Rate applicable for the
next Settlement Date, all as determined by the Agent.
"Noteholder's Insured Carryover Interest" means, as of any
date of determination, the amount of Insured Monthly Interest due on any prior
Settlement Date but not paid, plus interest thereon through such date from such
prior Settlement Date, calculated using the Series 2002-A Insured Note Interest
Rate applicable for the next Settlement Date, all as determined by the Agent.
"Obligor" means MLR II LLC.
"Original Issue Date" has the meaning specified in Section
3.07(b)(x) hereof.
"Original Servicer Fee Rate" has the meaning specified in
Section 3.07(b)(ix) hereof.
"Overconcentration Amount" means an amount, at any time, equal
to the sum of (i) the aggregate User Concentration Amount for all Users, (ii)
the aggregate State Concentration Amount for all States, (iii) the Equipment
Concentration Amount, (iv) the aggregate
16
Broker/Vendor Concentration Amounts for all Brokers and vendors, (v) the
Government Concentration Amount, (vi) the Quarterly Payment Concentration Amount
and (vii) the Broker Concentration Amount.
"Owner" means each Purchaser, each Liquidity Provider and each
other Person that has purchased, or has entered into a commitment to purchase, a
Series 2002-A Note, or an interest therein.
"Pledge" means the pledge by the Obligor hereunder of its
right, title and interest in and to specified Pledged Property related thereto
to the Trustee for the benefit of the Series 2002-A Noteholders in accordance
with Section 1.02 hereof.
"Pledge Date" has the meaning set forth in Section 4.01(b)
hereof.
"Pledge Notice" has the meaning specified in Section 4.01(b)
hereof.
"Pledged Property" means, with respect to the Series 2002-A
Trust Estate, each Series 2002-A Contract, together with all associated property
and rights with respect thereto described in clauses (2) through (7) of Section
1.02 hereof.
"Portfolio Charged-Off Ratio" means, as of the last day of any
Collection Period, the percentage equivalent of a fraction, the numerator of
which is equal to the product of (i) 12 and (ii) the excess of (x) the sum of
the aggregate of Marlin's net investment (calculated in accordance with GAAP) in
all leases included in the Servicer's servicing portfolio which would have first
satisfied the definition of Charged-Off Contracts (assuming that such definition
applied to such leases) during such Collection Period, over (y) the sum of all
recoveries during such Collection Period for leases included in the Servicer's
servicing portfolio, and the denominator of which is equal to the aggregate
undiscounted scheduled periodic payments on all leases included in the
Servicer's servicing portfolio as of the beginning of the related Collection
Period.
"Premium Amount" means, as of any Settlement Date, the
premiums due to the Series Support Provider for such Settlement Date, as
calculated pursuant to the Premium Letter.
"Premium Letter" means that certain letter agreement dated as
of April 1, 2002 by and among the Obligor, the Obligors' Agent, Xxxxxx and the
Series Support Provider, as it may be amended or modified and in effect from
time to time.
"Prime Rate" means the rate announced by National City from
time to time as its prime rate in the United States, such rate to change as and
when such designated rate changes. The Prime Rate is not intended to be the
lowest rate of interest charged by National City in connection with extensions
of credit to debtors.
"Pro Forma Borrowing Base" means, (x) as of any Pledge Date,
the Borrowing Base (including the various components thereof) as calculated
assuming that all Series 2002-A Contracts to be Pledged on such Pledge Date have
in fact been so Pledged and (y) as of any day which is not a Pledge Date, the
Borrowing Base as of such day.
17
"Purchase Price Percentage" means as of any date of
determination the lesser of (i) .87 and (ii) 1 minus the product of a times b
times c, where:
a = the Average Charged-Off Ratio as of such date of
determination;
b = the Weighted Average Life, rounded to the second decimal
place; and
c = 2.75
"Purchaser" has the meaning specified in the Note Purchase
Agreement.
"Quarterly Payment Concentration Amount" means, as of any date
of determination, the excess of (x) the aggregate Contract Principal Balance of
all Series 2002-A Contracts which are payable on a quarterly basis over (y) four
percent (4%) of the aggregate Contract Principal Balance of all Series 2002-A
Contracts which are Eligible Contracts at such time.
"Record Date" means, with respect to any Settlement Date, the
close of business on the Business Day preceding such Settlement Date.
"Redemption Price" has the meaning specified in Section 6.02
hereof.
"Refinance Proceeds" means with respect to any Collection
Period, proceeds of the issuance of a new series of notes or the issuance of
certificates in connection with a Take-Out of Series 2002-A Contracts, which
proceeds shall be remitted to the Trustee immediately upon receipt for deposit
into the Series 2002-A Facility Account for application in accordance with
Section 3.03 hereof.
"Required Reserve Amount" means, as to any Settlement Date,
the Reserve Percentage times the Net Investment (after giving effect to
distributions in reduction of the Net Investment on such Settlement Date).
"Reserve Percentage" means zero, unless and until the
Obligors' Agent notifies the Trustee in writing, countersigned by the Agent and
by the Series Support Provider, of a different percentage.
"Residual Advance Amount" shall have the meaning set forth in
any notice delivered to the Trustee by the Obligors' Agent, countersigned by the
Agent and the Series Support Provider. Prior to the delivery of such notice and
confirmation by Standard & Poor's and Moody's that their respective facility
shadow ratings will not be affected, the Residual Advance Amount shall be
considered to be zero.
"Restructured" means, with respect to any Series 2002-A
Contract, any deferral of Scheduled Payments, reduction of the Scheduled
Payments, or extension of the term of such Series 2002-A Contract, in each case
by the Servicer for credit reasons.
"Revolving Period" means the period from and including the
Series Closing Date to but excluding the Termination Date.
18
"Series Closing Date" means, with respect to the Series 2002-A
Notes, April 9, 2002.
"Series Controlling Party" has the meaning specified in
Section 3.07(b)(vi) hereof.
"Series Event of Default" has the meaning specified in Section
5.01 hereof.
"Series Support" means the financial guaranty insurance policy
No. 37833 issued by the Series Support Provider.
"Series Support Provider" means MBIA Insurance Corporation, a
New York stock insurance company, or any successor thereto, as issuer of the
Series Support.
"Series Support Provider Default" means the occurrence and
continuance of any of the following:
(a) the Series Support Provider shall have failed to make a
payment in the amount when or as required under the Series Support when
due; or
(b)(i) the Series Support Provider (A) files any petition or
commences any case or proceeding under any provision or chapter of the
United States Bankruptcy Code, the New York State Insurance Law, or any
other similar federal or state law relating to its insolvency,
bankruptcy, rehabilitation, liquidation or reorganization, (B) makes a
general assignment for the benefit of its creditors, or (C) has an
order for relief entered against it under the United States Bankruptcy
Code, the New York State Insurance Law, or any other similar federal or
state law relating to insolvency, bankruptcy, rehabilitation,
liquidation or reorganization which is final and nonappealable; or (ii)
a court of competent jurisdiction, the New York Department of Insurance
or other competent regulatory authority enters a final and
nonappealable order, judgment or decree (A) appointing a custodian,
trustee, agent or receiver for the Series Support Provider or for all
or any material portion of its property or (B) authorizing the taking
of possession by a custodian, trustee, agent or receiver of the Series
Support Provider (or the taking of possession of all or any material
portion of the property of the Series Support Provider); or
(c) a court of competent jurisdiction shall have determined in
a final, nonappealable order that the Series Support is no longer in
full force and effect.
"Series Trust Estate" means, with respect to the Series 2002-A
Notes, the Series 2002-A Trust Estate.
"Series Trustee Secured Obligations" has the meaning set forth
in Section 3.07(b)(vii).
"Series 2002-A Account" means each of the Series 2002-A
Facility Account and the Series 2002-A Reserve Account.
19
"Series 2002-A Alternative Rate" means, for any Interest
Period (or portion thereof) for which a Purchaser initially funds an investment
in the Series 2002-A Notes other than by issuing Commercial Paper, an interest
rate per annum equal to the LIBO Rate for such Interest Period (or such portion
thereof); provided, however, that:
(a) if a Purchaser shall notify the Agent that a LIBO Rate
Disruption Event has occurred and is continuing, then, in any such
case, the "Series 2002-A Alternative Rate" for the Series 2002-A Notes
for such Interest Period or portion thereof shall be an interest rate
per annum equal to the Series 2002-A Base Rate from time to time in
effect unless the Agent, the Series Support Provider and the Obligors'
Agent agree in writing to a different rate; and
(b) without limiting the foregoing, if with respect to any
Interest Period or portion thereof any Purchaser shall have notified
the Agent that the rate at which deposits of the United States dollars
are being offered to such Purchaser in the London interbank market does
not accurately reflect the cost to such Purchaser of funding its
investment in the Series 2002-A Notes for such Interest Period or
portion thereof, the Obligors' Agent, the Series Support Provider and
the Agent shall negotiate in good faith to determine a mutually
agreeable different rate as the Series 2002-A Alternative Rate
sufficient to meet such Purchaser's costs and, pending the conclusion
of those negotiations, the Series 2002-A Alternative Rate for each
Interest Period shall be the LIBO Rate; provided, however, that if the
Obligors' Agent, the Series Support Provider and the Agent have not
agreed upon a rate before the end of the second full Interest Period
following the date of such Purchaser's notice to the Agent, the Series
2002-A Alternative Rate for each successive Interest Period for so long
as the condition giving rise to such notice shall be continuing shall
be the Series 2002-A Base Rate.
"Series 2002-A Available Funds" means, with respect to any
Settlement Date, the aggregate amount of Collections received by the Servicer
during the prior Collection Period with respect to the Series 2002-A Trust
Estate (other than Collections representing Advance Payments until such Advance
Payments are applied as Collections in accordance with Section 7.01 of the
Master Agreement), plus any net payments under a Hedge Agreement received since
the previous Settlement Date (or the Series 2002-A Series Closing Date in the
case of the first Settlement Date), plus any Prepayment Amounts deposited in the
Series 2002-A Facility Account pursuant to Section 6.01 hereof. "Series 2002-A
Available Funds" do not include any proceeds of the Series Support or other
funds received from or on account of the Series Support Provider.
"Series 2002-A Alternative Insured Note Interest Rate" means,
with respect to any Interest Period, the weighted average (weighted based on the
related notional balances, as well as the number of days during such Interest
Period for which the related Applicable Hedge Agreement was in effect) of the
Applicable Hedge Rates applicable to all Applicable Hedge Agreements during such
interest period.
"Series 2002-A Base Insured Note Interest Rate" means for any
Interest Period for the Series 2002-A Notes, the weighted average of the
following rates determined for each
20
Purchaser (based on the respective investments of each Purchaser in the Series
2002-A Notes and the time period for which applicable rates are in effect):
(a) to the extent that a Purchaser funds its investments
in the Series 2002-A Notes for such Interest Period or portion thereof
by issuing Commercial Paper, the sum of (i) the CP Margin, (ii) the
weighted average of the rates at which Commercial Paper issued by such
Purchaser to fund the purchase or maintenance of its investments in the
Series 2002-A Notes during such Interest Period or portion thereof has
been sold by any placement agent or commercial paper dealer selected by
such Purchaser; provided, that, for purposes of calculating such
weighted average, if any such rate is a discount rate, such discount
rate shall be converted to an interest-bearing equivalent rate per
annum for a 360-day year and (iii) .05 percent per annum, and
(b) to the extent that a Purchaser funds its investment
in the Series 2002-A Notes for such Interest Period or portion thereof
other than by issuing Commercial Paper, a rate equal to the sum of (i)
the applicable LIBO Margin and (ii) the Base LIBO Rate for such
Interest Period or portion thereof or such other rate as the Agent, the
Series Support Provider and the Obligors' Agent shall agree to in
writing.
"Series 2002-A Base Rate" means, on any date, a fluctuating
rate per annum equal to the higher of (a) the Prime Rate or (b) the Federal
Funds Rate plus 0.5%.
"Series 2002-A Contract" means each Contract listed on a List
of Contracts attached to a Pledge Notice which is delivered in connection with a
Pledge of Pledged Property with respect to the Series 2002-A Trust Estate, and
which Contract has not been released from the Series 2002-A Trust Estate as
provided herein or in the Master Agreement.
"Series 2002-A Advance Payment Account" has the meaning set
forth in Section 3.01(c) hereof.
"Series 2002-A Facility Account" has the meaning set forth in
Section 3.01(a) hereof.
"Series 2002-A Insured Note Interest Rate" means for any
Interest Period for the Series 2002-A Notes, the lesser of:
(i) the Series 2002-A Base Insured Note Interest Rate for
such Interest Period; and
(ii) the Series 2002-A Alternative Insured Note Interest
Rate for such Interest Period.
"Series 2002-A Note" means any one of the Series 2002-A Notes
executed by the Obligor in favor of the Agent and authenticated by or on behalf
of the Trustee, substantially in the form of Exhibit A hereto, and any
replacement therefor.
"Series 2002-A Note Balance" means, as of any time of
determination, the aggregate, cumulative amount of the Advance Amounts funded
pursuant to Section 4.01(b) hereof since the Series Closing Date, reduced by the
aggregate, cumulative amounts described in
21
Sections 3.03(a)(i) tenth, 3.03(a)(ii) eleventh and 3.03(a)(ii) sixteenth and
actually paid to the Series 2002-A Noteholders on all prior Settlement Dates.
"Series 2002-A Noteholder" shall mean any Owner, as defined
herein.
"Series 2002-A Note Interest Rate" means for any Interest
Period for the Series 2002-A Notes, the weighted average of the following rates
determined for each Purchaser (based on the respective investments of each
Purchaser in the Series 2002-A Notes and the time period for which applicable
rates are in effect):
(a) to the extent that a Purchaser funds its
investments in the Series 2002-A Notes for such Interest
Period or portion thereof by issuing Commercial Paper, the sum
of (i) the CP Margin, (ii) the weighted average of the rates
at which Commercial Paper issued by such Purchaser to fund the
purchase or maintenance of their investments in the Series
2002-A Notes during such Interest Period or portion thereof
has been sold by any placement agent or commercial paper
dealer selected by such Purchaser; provided, that, for
purposes of calculating such weighted average, if any such
rate is a discount rate, such discount rate shall be converted
to an interest-bearing equivalent rate per annum for a 360-day
year, and (iii) 0.05 percent per annum; and
(b) to the extent that a Purchaser funds its
investments in the Series 2002-A Notes for such Interest
Period or portion thereof other than by issuing Commercial
Paper, a rate equal to the sum of (i) the applicable LIBO
Margin and (ii) the Series 2002-A Alternative Rate for such
Interest Period or portion thereof or such other rate as the
Agent, the Series Support Provider and the Obligors' Agent
shall agree to in writing.
The Series 2002-A Note Interest Rate for any Interest Period shall be adjusted
to yield, when applied to the outstanding principal balance of the Series 2002-A
Notes, an amount sufficient to pay interest on the incremental effective
principal balance of any funding resulting from the capitalization of interest,
if any, during such Interest Period.
As used in paragraph (a) of this definition, each Purchaser's weighted average
of the Commercial Paper rates shall include (x) any incremental carrying costs
incurred with respect to Commercial Paper maturing on dates other than those on
which corresponding funds are received by such Purchaser, and (y) other
borrowings by such Purchaser to fund the Net Investment (other than under any
liquidity agreement or other program support agreement), including borrowings to
fund small or odd dollar amounts that are not easily accommodated in the
commercial paper market.
"Series 2002-A Related Documents" means, collectively, this
Series 2002-A Supplement, the Fee Letter, the Premium Letter, the Hedge
Agreement(s), the Master Agreement, the Master Transfer Agreement, the Insurance
Agreement, the Collateral Administration Agreement, the Note Purchase Agreement,
the Series Support, the Series 2002-A Notes and all other instruments,
documents, financing statements and agreements executed and delivered by the
Obligor, the Obligors' Agent or the Servicer in connection herewith or therewith
22
and each Series 2002-A Transfer Agreement Supplement executed pursuant thereto
with respect to the Series 2002-A Trust Estate.
"Series 2002-A Reserve Account" shall have the meaning set
forth in Section 3.01(b) hereof.
"Series 2002-A Secured Parties" shall have the meaning set
forth in Section 3.07(b)(viii) hereof.
"Series 2002-A Transfer Agreement Supplement" means each
Transfer Agreement Supplement entered into pursuant to the Master Transfer
Agreement which transfers Series 2002-A Contracts to the Obligor for inclusion
in the Series 2002-A Trust Estate.
"Series 2002-A Trust Estate" shall have the meaning set forth
in Section 1.02 hereof.
"Servicer's Certificate" means a report with respect to Series
2002-A, in substantially the form of Exhibit D hereto (appropriately completed),
furnished by the Servicer to the Obligors' Agent, the Trustee, the Series
Support Provider and the Agent pursuant to Section 6.06 of the Master Agreement.
"Servicing Fee" means as of any Settlement Date, an amount
equal to one-twelfth of 1.00% of the daily average Contract Principal Balance of
the Series 2002-A Contracts during the prior Collection Period, payable on each
Settlement Date to the Servicer pursuant to Section 3.03 hereof as compensation
for the performance of its duties hereunder and under the Master Agreement.
"Settlement Date" means the 15th of each month (or if the 15th
of any month is not a Business Day, then on the next succeeding Business Day)
commencing with May 15, 2002.
"State Concentration Amount" means:
(i) for any State other than New Jersey,
Florida, Texas or California, the excess, if
any, of (x) the aggregate Contract Principal
Balance of all Series 2002-A Contracts with
respect to which any User is domiciled in
such State, over (y) ten percent (10%) of
the Net Investment at such time; plus
(ii) for each of Florida, Texas and California,
individually, the excess, if any, of (x) the
aggregate Contract Principal Balance of all
Series 2002-A Contracts with respect to
which any User is domiciled in such State
over fifteen percent (15%) of the Net
Investment at such time; plus
(iii) for New Jersey, the excess, if any of (x)
the aggregate Contract Principal Balance of
all Series 2002-A Contracts with respect to
which any User is domiciled in such State
over seventeen and one-half percent (17.50%)
of the Net Investment at such time.
23
"Support Interest Funding" means any drawing under the Series
Support, or any advance or other payment by the Series Support Provider in lieu
of funding a drawing under the Series Support, in either case made with respect
to (a) a shortfall in amounts available to pay the Noteholder's Insured
Carryover Interest, as described in Section 3.03(e)(i) hereof or (b) the
avoidance of any payment in respect of Insured Monthly Interest, as described in
Section 3.03(e)(iii) hereof.
"Support Principal Funding" means any drawing under the Series
Support, or any advance or other payment by the Series Support Provider in lieu
of funding a drawing under the Series Support, in either case made with respect
to (a) a shortfall in amounts available to pay the Series 2002-A Note Balance to
zero, as described in Section 3.03(e)(ii) hereof or (b) the avoidance of any
payment in respect of the Series 2002-A Note Balance as a preference, as
described in Section 3.03(e)(iii) hereof.
"Swap Agreement" means a Hedging Agreement other than a Cap
Agreement.
"Take Out" means the refinancing of all of the Series 2002-A
Contracts (whether through the issuance of asset-backed securities, funding
through other Committed Financing Facilities, whole loan sales or otherwise).
"Tangible Net Worth" means, as of any date of determination
with respect to Xxxxxx, its shareholders' equity, less any intangible assets,
all determined in accordance with GAAP; provided that neither (a) the principal
portion of any subordinated debt which is payable within six months of such date
of determination nor (b) any preferred stock which has a put right or other
similar right within six months of such date of determination shall be
considered equity.
"Termination Date" means the earliest to occur of: (i) the two
(2) year anniversary of the Series Closing Date, or such later date as the
parties (with the express written consent of the Agent and Series Support
Provider) may hereafter agree in accordance with Section 4.01(i), (ii) the day
designated as the Termination Date by the Obligor on sixty (60) days' prior
written notice to the Agent and the Series Support Provider, (iii) the day on
which the Series Controlling Party declares the occurrence of the Termination
Date or on which the Termination Date automatically occurs pursuant to Section
5.01, (iv) the date on which the Series Support Provider's claims paying ability
or financial strength rating is rated below "A" by Standard & Poor's or A2 by
Moody's, (v) the 90th day following the date on which the Series Support
Provider has delivered a written notice to the Transferor and the Agent to the
effect that the most recent audit completed by the Series Support Provider or
its designee of the Transferor's origination, servicing and documentation
procedures has revealed to the Series Support Provider deficiencies which it
reasonably believes creates a material adverse effect on the facility, (vi) a
Hedge Counterparty fails to satisfy the definition thereof and is not replaced
within fifteen (15) Business Days by a Person satisfying the definition thereof
and (vii) the date on which the Liquidity Agreement is no longer in full force
and effect. The Agent shall notify the Obligors' Agent and the Series Support
Provider immediately upon receipt of notice of, but in any event at least 10
days prior to the date referenced in clause (vii), of the up-coming occurrence
of such event described in clause (vii). In addition, no later than 45 days
before the scheduled termination of the Liquidity Agreement, the Agent shall
notify the Obligors' Agent and the Series
24
Support Provider as to whether the Company has submitted a renewal request under
the Liquidity Agreement.
"Three-Month Rolling Average" means, with respect to any pool
performance ratio, the sum of the applicable ratio for the most recently ended
Collection Period and two immediately preceding Collection Periods (or such
fewer Collection Periods as have previously occurred) divided by three (or such
smaller number).
"Trustee Fee" means the monthly fee payable to the Trustee on
each Settlement Date, which shall be the greater of (x) one-twelfth of two basis
points (0.02%) per annum times the aggregate Contract Principal Balance of the
Series 2002-A Contracts as of the end of the preceding Collection Period and (y)
$1,000.
"Unused Fee" shall have the meaning set forth in the Fee
Letter.
"User Concentration Amount" means, for any User, the excess,
if any, of (x) the aggregate Contract Principal Balance of all Series 2002-A
Contracts with respect to which such User or any Affiliate of such User is the
User, over (y) one percent (1.0%) of the Net Investment at such time.
"Weighted Average Hedge Rate" means, with respect to any
Interest Period, the weighted average (weighted based on the related notional
balances, as well as the number of days during such Interest Period for which
the related Hedge Agreement was in effect) of Hedge Rates applicable to all
Hedge Agreements under which payment will be received on the Settlement Date
relating to such Interest Period.
"Weighted Average Life" means, as of any date of
determination, a term in years equal to the sum of:
(summation) (Pn X Tn)
---------
PB
where:
(summation) = The mathematical symbol for summation. The
summation is computed from 1 to n, where n is the number of
months from the date of determination until the date of the
last Scheduled Payment under the last Series 2002-A Contract
scheduled to be outstanding;
Pn = The sum of the principal portions of the Scheduled
Payments for all Series 2002-A Contracts in the nth month
after the date of determination;
Tn = The remaining period, in months, from the time of
calculation until such nth month; and
PB = The aggregate Contract Principal Balance of all Series
2002-A Contracts at the time of calculation, divided by 12 and
rounded to the second decimal place.
25
ARTICLE III
DISTRIBUTIONS AND STATEMENTS TO
SERIES 2002-A NOTEHOLDER; SERIES SPECIFIC COVENANTS
Section 3.01 Series 2002-A Accounts.
(a) The Trustee, for the benefit of the Series 2002-A
Secured Parties, shall establish and maintain an account (the "Series 2002-A
Facility Account") as a segregated trust account in the Trustee's corporate
trust department, identified as the "Xxxxx Fargo Bank Minnesota, National
Association, as Trustee, Facility Account for Xxxxxx Master Financing Facility
Agreement, in trust for the Series 2002-A Secured Parties." The Trustee shall
make or permit withdrawals from the Series 2002-A Facility Account only as
provided in this Series 2002-A Supplement;
(b) The Trustee, for the benefit of the Series 2002-A
Secured Parties, shall establish and maintain an account (the "Series 2002-A
Reserve Account") as a segregated trust account in the Trustee's corporate trust
department, identified as the "Xxxxx Fargo Bank Minnesota, National Association,
as Trustee, Reserve Account for Xxxxxx Master Financing Facility Agreement, in
trust for the Series 2002-A Secured Parties." The Trustee shall make or permit
withdrawals from the Series 2002-A Reserve Account only as provided in this
Series 2002-A Supplement and in the Master Agreement;
(c) The Trustee, for the benefit of the Series 2002-A
Secured Parties, shall establish and maintain an account (the "Series 2002-A
Advance Payment Account") as a segregated trust account in the Trustee's
corporate trust department, identified as the "Xxxxx Fargo Bank Minnesota,
National Association, as Trustee, Advance Payment Account for Xxxxxx Master
Financing Facility Agreement, in trust for the Series 2002-A Secured Parties."
The Trustee shall make or permit withdrawals from the Series 2002-A Advance
Payment Account only as provided in this Series 2002-A Supplement and in the
Master Agreement;
(d) The Trustee shall deposit to the Series 2002-A
Facility Account all Refinance Proceeds remitted to it by the Obligor
immediately upon the Trustee's receipt thereof;
(e) The Trustee shall deposit to the Series 2002-A
Facility Account any Crossover Amounts remitted to it from other Series assigned
to Group A, as provided in the Series Supplement(s) relating to such other
Series; and
(f) Notwithstanding the foregoing or anything in the
Master Agreement to the contrary, upon written instruction from the Servicer,
the Trustee may deduct from amounts otherwise specified for deposit to the
Series 2002-A Facility Account any amounts previously deposited by the Trustee
into the Series 2002-A Facility Account but which (i) are subsequently
uncollectible as a result of dishonor of the instrument of payment for or on
behalf of the User, (ii) are later determined to have resulted from mistaken
deposits or (iii) constitute Servicing Charges.
26
Section 3.02 Agent to Send Notice of Amounts Due. On each
Determination Date, the Agent shall send to the Servicer (with a copy to the
Trustee and the Series Support Provider), a notice in the form of Exhibit C to
the Note Purchase Agreement.
Section 3.03 Distributions from Series 2002-A Facility
Account.
(a) On each Settlement Date, the Trustee (based solely on
the information set forth in the related Servicer's Certificate) shall allocate
and distribute funds on deposit in the Series 2002-A Facility Account in the
following order of priority, without duplication:
(i) if such Settlement Date occurs during the Revolving
Period:
first, from Series 2002-A Available Funds, to pay to
the Servicer and the Trustee, as applicable, any
amounts referred to in Section 3.01(f) and to pay to
any other Persons that mistakenly deposited funds
into the Series 2002-A Facility Account, such
mistakenly deposited funds;
second, from the remaining Series 2002-A Available
Funds, to the Servicer, an amount necessary to
reimburse the Servicer for any unreimbursed Servicer
Advances with respect to Series 2002-A Contracts;
third, from the remaining Series 2002-A Available
Funds, to the Trustee for payment to Hedge
Counterparties, amounts due under the related Hedge
Agreements, except amounts due as fees, expenses or
as the consequence of the occurrence of an event of
default or termination event under such Hedge
Agreement or otherwise due upon the termination of
such Hedge Agreement, which amounts shall be paid as
provided in clause sixteenth below;
fourth, from the remaining Series 2002-A Available
Funds to the Servicer, if the Servicer is not the
Obligor or an Affiliate of the Obligor, in payment of
any Servicing Fee then due;
fifth, from the remaining Series 2002-A Available
Funds, to the Trustee, the Trustee Fee, and to the
Back-up Servicer, the Back-Up Servicing Fee, any
out-of-pocket expenses of the Trustee and the Back-up
Servicer or successor Servicer reasonably incurred in
connection with the Series 2002-A transaction and,
subject to an aggregate, cumulative maximum
(including amounts paid under paragraph (a)(ii) fifth
below) of $50,000 (with respect to the above
described expenses) during the term of this facility,
any expenses in excess of such cumulative maximum
amount if such expenses are approved in writing by
the Series Support Provider and any servicing
Transition Cost due such Persons under this Series
Supplement;
sixth, from the remaining Series 2002-A Available
Funds, if no Series Support Provider Default has
occurred and is continuing, to the Series Support
Provider (x) the Premium Amount due to the Series
Support
27
Provider on such Settlement Date in connection with
the Series Support and (y) any unpaid Premium Amount
due on prior Settlement Dates, together with (in the
case of any such unpaid Premium Amount) interest
thereon, calculated at the rate set forth in the
Insurance Agreement, all as certified by the Series
Support Provider to the Trustee, the Agent and the
Obligors' Agent;
seventh, from the remaining Series 2002-A Available
Funds, if no Series Support Provider Default has
occurred and is continuing, to the Series Support
Provider, the aggregate amount necessary to reimburse
the Series Support Provider for prior unreimbursed
Support Interest Fundings, together with interest
thereon, calculated at the rate set forth in the
Insurance Agreement, all as certified by the Series
Support Provider to the Trustee, the Agent and the
Obligors' Agent;
eighth, from the remaining Series 2002-A Available
Funds, and amounts provided pursuant to the Series
Support, to the Series 2002-A Noteholders the
following amounts in the following order, without
duplication: (a) the Noteholder's Insured Carryover
Interest, if any, minus the amount of any such
Noteholder's Insured Carryover Interest arising as a
result of any payment default by National City under
any Hedge Agreement with respect to any prior
Settlement Date and (b) the Insured Monthly Interest
due on such Settlement Date minus the amount of any
payment default by National City under any Hedge
Agreement with respect to such Settlement Date;
ninth, from the remaining Series 2002-A Available
Funds, if a Series Support Provider Default has
occurred and is continuing, to the Series Support
Provider, the amounts described in clauses sixth and
seventh above;
tenth, from the remaining Series 2002-A Available
Funds, to the Series 2002-A Noteholders in reduction
of the Series 2002-A Note Balance, the lesser of:
(x) such remaining Series 2002-A
Available Funds and
(y) the excess of (i) the Net
Investment, after taking into account any reduction
thereof on such Settlement Date pursuant to the
preceding clauses of this subsection (a)(i), over (2)
the Pro Forma Borrowing Base which, for purposes of
this clause (y), shall not include the portion of the
Series 2002-A Available Funds then on deposit in the
Series 2002-A Facility Account which represents funds
required to be applied to the amortization of the
Series 2002-A Note Balance for the related Collection
Period;
28
eleventh, from the remaining Series 2002-A Available
Funds, to the Series 2002-A Noteholders, the
following amounts in the following order: (a) the
excess, if any, of the Noteholder's Carryover
Interest over the Noteholder's Insured Carryover
Interest and (b) the excess, if any, of the Monthly
Interest over the Insured Monthly Interest, in each
case due on such Settlement Date;
twelfth, from the remaining Series 2002-A Available
Funds, ratably (and based upon the amounts owed to
each):
(i) to the Series Support Provider, in
payment of any other amounts owing to the
Series Support Provider under the Series
2002-A Related Documents, as certified by
the Series Support Provider to the Trustee,
the Agent and the Obligors' Agent; and
(ii) to the Series 2002-A Noteholder, for
the benefit of the applicable Owners, in
payment of the Unused Fee, Breakage Costs
and any other amounts owing to the Series
2002-A Noteholders or the Agent under the
Series 2002-A Related Documents for the
current Collection Period and any prior
Collection Period, as certified by the Agent
to the Trustee, the Series Support Provider
and the Obligors' Agent;
thirteenth, to the Servicer, if the Servicer is a
person other than Xxxxxx or any Affiliate thereof, by
wire transfer of immediately available funds to the
account designated by such Servicer, the Increased
Servicer Fee, if any, then due, together with any
unpaid Increased Servicer Fees from prior Collection
Periods, if any;
fourteenth, from the remaining Series 2002-A
Available Funds, to the Series 2002-A Reserve
Account, an amount up to the amount, if any,
necessary to make the amounts on deposit in the
Series 2002-A Reserve Account equal the Required
Reserve Amount;
fifteenth, from the remaining Series 2002-A Available
Funds, to the Obligors, the lesser of:
(i) the Advance Amount for all Series
2002-A Contracts being Pledged on such Settlement
Date in accordance with Section 4.01(e) hereof; and
(ii) such remaining Series 2002-A
Available Funds;
sixteenth, from the remaining Series 2002-A Available
Funds, ratably, to each Hedge Counterparty (and based
upon the amounts owed to each) any amounts due to it
as fees, expenses or as the consequence of an event
of default or termination event under the related
Hedge Agreement or otherwise due upon the termination
of the related Hedge Agreement;
29
seventeenth, from the remaining Series 2002-A
Available Funds and from amounts, if any, on deposit
in the Series 2002-A Reserve Account in excess of the
Required Reserve Amount, to the Servicer, if the
Servicer is an Obligor or an Affiliate of an Obligor,
in payment of any accrued and unpaid Servicing Fee
then due;
eighteenth, from the remaining Series 2002-A
Available Funds, to the Series 2002-A Noteholders the
following amounts in the following order, without
duplication: (a) the amount of any Noteholder's
Insured Carryover Interest arising as a result of any
payment default by National City under any Hedge
Agreement with respect to any prior Settlement Date
which remains unpaid pursuant to clause eighth above
and (b) the amount of any Insured Monthly Interest
due on such Settlement Date which remains unpaid as a
result of payment default by National City under any
Hedge Agreement with respect to such Settlement Date
pursuant to clause eighth above; and
nineteenth, from the remaining Series 2002-A
Available Funds and from amounts, if any, on deposit
in the Series 2002-A Reserve Account in excess of the
Required Reserve Amount, the balance, if any, to
other Series in Group A, if any, and thereafter to
the Obligors' Agent for the benefit of the applicable
Obligor(s), or as otherwise directed by it in
writing.
(ii) if such Settlement Date occurs during the
Amortization Period:
first, from Series 2002-A Available Funds to pay to
the Servicer and the Trustee, as applicable, any
amounts referred to in Section 3.01(f) and to pay to
any other Persons that mistakenly deposited funds
into the Series 2002-A Facility Account, such
mistakenly deposited funds;
second, from the remaining Series 2002-A Available
Funds, to the Servicer, an amount necessary to
reimburse the Servicer for any unreimbursed Servicer
Advances with respect to the Series 2002-A Contracts;
third, from the remaining Series 2002-A Available
Funds, to the Trustee for payment to Hedge
Counterparties, amounts due under the related Hedge
Agreements, except amounts due as fees, expenses or
as the consequence of the occurrence of an event of
default or termination event under such Hedge
Agreement or otherwise due upon the termination of
such Hedge Agreement, which amounts shall be paid as
provided in clause eighteenth below;
fourth, from the remaining Series 2002-A Available
Funds, to the Servicer, if the Servicer is not the
Obligor or an Affiliate of the Obligor, in payment of
any Servicing Fee then due;
30
fifth, from the remaining Series 2002-A Available
Funds, to the Trustee, the Trustee Fee, and to the
Back-up Servicer, the Back-Up Servicing Fee, any
out-of-pocket expenses of the Trustee and the Back-up
Servicer or successor Servicer reasonably incurred in
connection with the Series 2002-A transaction and,
subject to an aggregate, cumulative maximum
(including amounts paid under paragraph (a)(i) fifth
above) of $50,000 (with respect to the above
described expenses) during the term of this facility,
any expenses in excess of such cumulative maximum
amount if such expenses are approved in writing by
the Series Support Provider and any servicing
Transition Cost due such Persons under this Series
Supplement;
sixth, from the remaining Series 2002-A Available
Funds, if no Series Support Provider Default has
occurred and is continuing, (x) the Premium Amount
due the Series Support Provider on such Settlement
Date in connection with the Series Support and (y)
any unpaid Premium Amounts due on prior Settlement
Dates, together with (in the case of any such unpaid
Premium Amounts) interest thereon, calculated at the
rate set forth in the Insurance Agreement, all as
certified by the Series Support Provider to the
Trustee, the Agent and the Obligors' Agent;
seventh, from the remaining Series 2002-A Available
Funds, if no Series Support Provider Default has
occurred and is continuing, to the Series Support
Provider, the aggregate amount necessary to reimburse
the Series Support Provider for prior unreimbursed
Support Interest Fundings, together with interest
thereon, calculated at the rate set forth in the
Insurance Agreement, all as certified by the Series
Support Provider to the Trustee, the Agent and the
Obligors' Agent;
eighth, from the remaining Series 2002-A Available
Funds, if no Series Support Provider Default has
occurred and is continuing, to the Series Support
Provider, the aggregate amount necessary to reimburse
the Series Support Provider for prior unreimbursed
Support Principal Fundings, together with interest
thereon, calculated at the rate set forth in the
Insurance Agreement, all as certified by the Series
Support Provider to the Trustee, the Agent and the
Obligors' Agent;
ninth, from the remaining Series 2002-A Available
Funds, and amounts provided pursuant to the Series
Support, to the Series 2002-A Noteholders the
following amounts in the following order, without
duplication: (a) the Noteholder's Insured Carryover
Interest, if any, minus the amount of any such
Noteholder's Insured Carryover Interest arising as a
result of any payment default by National City under
any Hedge Agreement with respect to any prior
Settlement Date and (b) the Insured Monthly Interest
due on such Settlement Date minus the amount of any
payment default by National City under any Hedge
Agreement with respect to such Settlement Date;
31
tenth, from the remaining Series 2002-A Available
Funds, if a Series Support Provider Default has
occurred and is continuing, to the Series Support
Provider, the amounts described in clauses sixth and
seventh above;
eleventh, from the remaining Series 2002-A Available
Funds (plus, on the first Settlement Date during the
Amortization Period, the amount on deposit in the
Series 2002-A Reserve Account), to the Series 2002-A
Noteholders, in reduction of the Series 2002-A Note
Balance, the sum of (1) the amount if any, by which
(x) the Borrowing Base as of the end of the second
preceding Collection Period exceeded (y) the
Borrowing Base as of the end of the immediately
preceding Collection Period plus (2) any unpaid
amounts due under this clause eleventh on prior
Settlement Dates;
twelfth, from the remaining Series 2002-A Available
Funds, if a Series Support Provider Default has
occurred and is continuing, to the Series Support
Provider, the amount described in clause eighth
above;
thirteenth, from the remaining Series 2002-A
Available Funds, to the Series 2002-A Noteholders,
the following amounts in the following order: (a) the
excess, if any, of the Noteholder's Carryover
Interest over the Noteholder's Insured Carryover
Interest and (b) the excess, if any, of the Monthly
Interest over the Insured Monthly Interest, in each
case due on such Settlement Date;
fourteenth, to the Servicer, if the Servicer is a
person other than Xxxxxx or any Affiliate thereof, by
wire transfer of immediately available funds to the
account designated by such Servicer, the Increased
Servicer Fee, if any, then due, together with any
unpaid Increased Servicer Fees from prior Collection
Periods, if any;
fifteenth, from the remaining Series 2002-A Available
Funds, to the Servicer, if the Servicer is an Obligor
or an Affiliate of an Obligor, in payment of any
accrued and unpaid Servicing Fee then due;
sixteenth, from the remaining Series 2002-A Available
Funds (plus, on the first Settlement Date during the
Amortization Period, the amount on deposit in the
Reserve Account not applied under clause eleventh
above) to the Series 2002-A Noteholders in reduction
of the Series 2002-A Note Balance, the lesser of (i)
100% of such amount and (ii) the then-outstanding
Series 2002-A Note Balance (calculated after taking
into account any reduction therein under clause
eleventh above);
seventeenth, from the remaining Series 2002-A
Available Funds, ratably (and based upon the amounts
owed to each)
(i) Series Support Provider, in payment
of any other amounts owing to the
Series Support Provider under the
Series
32
2002-A Related Documents, as
certified by the Series Support
Provider to the Trustee, the Agent
and the Obligors' Agent; and
(ii) to the Series 2002-A Noteholder, for
the benefit of the applicable
Owners, in payment of the Unused
Fee, Breakage Costs and any other
amounts owing to the Series 2002-A
Noteholders or the Agent under the
Series 2002-A Related Documents for
the current Collection Period and
any prior Collection Period, as
certified by the Agent to the
Trustee, the Series Support Provider
and the Obligors' Agent;
eighteenth, from the remaining Series 2002-A
Available Funds, ratably, to each Hedge Counterparty
(and based upon the amounts owed to each) any amounts
due as fees, expenses or as the consequence of an
event of default or termination event under the
related Hedge Agreement or otherwise due upon the
termination of the related Hedge Agreement;
nineteenth, from the remaining Series 2002-A
Available Funds, to the Series 2002-A Noteholders the
following amounts in the following order, without
duplication: (a) the amount of any Noteholder's
Insured Carryover Interest arising as a result of any
payment default by National City under any Hedge
Agreement with respect to any prior Settlement Date
which remains unpaid pursuant to clause ninth above
and (b) the amount of any Insured Monthly Interest
due on such Settlement Date which remains unpaid as a
result of payment default by National City under any
Hedge Agreement with respect to such Settlement Date
pursuant to clause ninth above; and
twentieth, from the remaining Series 2002-A Available
Funds the balance, if any, to other Series in Group
A, if any, and thereafter to the Obligors' Agent for
the benefit of the applicable Obligor(s), or as
otherwise directed by it in writing.
(b) All payments of interest, principal, fees, and other
amounts payable to the Series 2002-A Noteholders hereunder shall be made on each
Settlement Date to the Agent for the benefit of the applicable Purchaser(s) by
wire transfer of immediately available funds to an account designated in
writing, in the form of Exhibit C hereto delivered to the Trustee on or prior to
the related Determination Date without presentation or surrender of the Series
2002-A Note or the making of any notation thereon. All computations of interest,
including computations of Noteholder's Carryover Interest, Noteholder's Insured
Carryover Interest, Monthly Interest, and Insured Monthly Interest, and any fees
due to the Series 2002-A Noteholder hereunder shall be made on the basis of a
year consisting of 360 days for the actual number of days elapsed.
(c) Any designation by the Agent of an account for
receipt of wire transfers pursuant to the preceding clause (b) shall be a
standing instruction, effective with respect to the
33
applicable Settlement Date and all subsequent Settlement Dates thereafter until
revoked. In the absence of such timely wire transfer instructions, payment will
be made by cashiers check sent by overnight courier to the Agent at the address
designated pursuant to Section 7.01. All reasonable costs and expenses incurred
by the Trustee in connection with the distribution of the payments to the Series
2002-A Noteholders or the Series Support Provider as set forth in this Section
3.03(c) shall be paid by the Servicer.
(d) (i) In the event that on any Determination Date
occurring during the Revolving Period, the Servicer's Certificate indicates that
Series 2002-A Available Funds will be insufficient to make the payments provided
for in clauses first through thirteenth of Section 3.03(a)(i) on the related
Settlement Date, the Trustee will on the related Settlement Date withdraw the
amount of such insufficiency from the Series 2002-A Reserve Account to the
extent of amounts available therein and apply the amount withdrawn in accordance
with the priorities specified in Section 3.03(a)(i) through such clause
thirteenth.
(ii) On the first Settlement Date occurring
during the Amortization Period all amounts then on deposit in the Series 2002-A
Reserve Account shall be transferred to the Series 2002-A Facility Account for
application in accordance with priorities eleventh and sixteenth only of Section
3.03(a)(ii) hereof on such Settlement Date.
(e) (i) In the event that on any Determination Date,
the Servicer's Certificate indicates that Series 2002-A Available Funds together
with any amounts withdrawn from the Series 2002-A Reserve Account in accordance
with Section 3.03(d) will be insufficient when applied in accordance with the
priorities specified in Section 3.03(a)(i) eighth or Section 3.03(a)(ii) ninth
on the related Settlement Date, to make the distribution of the Noteholder's
Insured Carryover Interest described in such clauses and (ii) such Noteholder's
Insured Carryover Interest will, on such related Settlement Date, relate to
Insured Monthly Interest originally due on the second (or earlier) preceding
Settlement Date, the Trustee will deliver a Notice for Payment in the form set
forth as an exhibit to the Series Support in the amount of such shortfall to the
Series Support Provider on the second Business Day prior to such Settlement
Date. Upon receipt of funds from the Series Support Provider in respect of such
Notice for Payment, the Trustee shall pay such amount to the Series 2002-A
Noteholders in respect of the such Noteholder's Insured Carryover Interest
payable under such clauses.
(ii) In addition, in the event that on the date
following the Termination Date that is 180 days after the last Scheduled Payment
of the last outstanding Series 2002-A Contract, the Series 2002-A Note Balance
has not been reduced to zero, the Trustee will deliver a Notice for Payment in
the form set forth as an exhibit to the Series Support in the amount of the
remaining Series 2002-A Note Balance to the Series Support Provider. Upon
receipt of funds from the Series Support Provider in respect of such Notice for
Payment, the Trustee will pay such amount to the Series 2002-A Noteholders in
reduction of the Series 2002-A Note Balance.
(iii) If the payment of any amount which is
guaranteed pursuant to the Series Support is voided as a preference (an
"Avoidance Event") under any applicable bankruptcy, insolvency, receivership or
similar law in a bankruptcy, insolvency, readjustment of debt, reorganization or
similar proceeding (an "Insolvency Proceeding") and, as a result of such an
Avoidance Event, the Trustee or a Noteholder is required to return such payment,
the Trustee
34
will, upon obtaining knowledge of such Avoidance Event, deliver a Notice of
Payment in the form set forth as an Exhibit to the Series Support in the amount
of such payment to the Series Support Provider. Upon receipt of funds from the
Series Support Provider in respect of such Notice for Payment, the Trustee will
pay such amount to the applicable Series 2002-A Noteholders.
(f) Notwithstanding the priority of payments set forth in
Section 3.03(a) above or any other term or provision of this Series 2002-A
Supplement or the Master Agreement to the contrary, payments made by the Series
Support Provider to the Trustee for the benefit of the Series 2002-A Noteholders
shall be applied solely to the obligations in respect of which the related
Notice for Payment was delivered. Amounts paid by the Series Support Provider to
the Trustee and paid to the Series 2002-A Noteholders shall not be considered
payment by the Obligors or otherwise with respect to the Series 2002-A Notes,
nor shall such payments discharge any obligations of the Obligors with respect
to the Series 2002-A Notes, and the Series Support Provider shall become the
owner of the portion of Insured Monthly Interest, the Noteholder's Insured
Carryover Interest and the Series 2002-A Note Balance, as the case may be, in
respect of which such payments were made as assignee and subrogee of the Series
2002-A Noteholders and shall be entitled to receive reimbursement in respect
thereof. The Trustee hereby agrees on behalf of each Series 2002-A Noteholder
for the benefit of the Series Support Provider that it recognizes that to the
extent the Series Support Provider makes payments to the Trustee for the benefit
of the Series 2002-A Noteholders, the Series Support Provider shall become the
owner of the applicable portion of the Series 2002-A Notes as assignee and
subrogee of the Series 2002-A Noteholders and shall be entitled to receive the
related reimbursement in accordance with the priority of distributions
referenced in Section 3.03(a)(i) and Section 3.03(a)(ii) (as appropriate) above.
(g) The Trustee shall not have any duty or obligation to
recalculate, recompute or verify the information contained in the Servicer's
Certificate.
Section 3.04 Reporting and Review Requirements.
(a) The Servicer shall send to the Agent, the Series
Support Provider and the Trustee a Servicer's Certificate with respect to each
Collection Period, such Servicer's Certificate to be in the form of that
attached hereto as Exhibit D, not later than three (3) Business Days prior to
the immediately succeeding Settlement Date. Such report shall also be sent to
the Trustee in an electronic format acceptable to the Trustee.
(b) By January 31 of each calendar year, commencing
January 31, 2003, the Servicer shall prepare and distribute to the Agent a
statement containing such information as is required to be provided by an issuer
of indebtedness under the Code and such other customary information as is
necessary or may reasonably be requested by the Agent to enable the Purchasers
to prepare their tax returns.
(c) The Series Support Provider or its designee shall, at
Marlin's expense (not to exceed $52,500 per annum plus out-of-pocket costs and
expenses) be permitted to conduct such audits of Marlin's origination, servicing
and documentation procedures as the Series Support Provider shall deem
necessary, but not more frequently than three times per year. In
35
addition, the Series Support Provider or its designee shall have the right (1)
as long as a Series Event of Default has not occurred and is not continuing, to
conduct additional audits at the Series Support Provider's (or its designee's)
expense, upon at least two Business Day's prior notice and (2) following the
occurrence of and during the continuance of a Series Event of Default, to
conduct audits as frequently as it deems necessary, at any time without prior
notice and at Marlin's expense.
(d) Xxxxxx shall provide the Agent and the Series Support
Provider with a covenant compliance certificate (as part of the Servicer's
Certificate), to the effect that, as of the end of each calendar quarter, Xxxxxx
and each Obligor is in compliance with its respective covenants hereunder
(listing any exceptions) signed by the Servicing Officer of Xxxxxx and delivered
within 45 days of the end of such calendar quarter.
(e) Xxxxxx shall provide the Agent and the Series Support
Provider with consolidated and consolidating financial statements (consolidating
financial statements to include, in columnar format, all wholly-owned
subsidiaries of Xxxxxx, with the exception of subsidiaries that are
special-purpose entities), in each case prepared in accordance with GAAP (i)
unaudited, on a quarterly basis, within 45 days of the end of each calendar
quarter, certified by the Chief Financial Officer of Xxxxxx and (ii) audited, on
an annual basis, within 120 days of the end of each fiscal year, audited by
Marlin's Independent Public Accountants.
(f) Xxxxxx shall provide the Agent and the Series Support
Provider with a copy of its "monthly business review" within 30 days of the end
of each month.
(g) Xxxxxx shall provide the Agent and the Series Support
Provider with a copy of its annual management/internal control report prepared
by Marlin's Independent Public Accountants, promptly following Marlin's receipt
thereof and in no event later than 120 days following the end of each fiscal
year.
(h) Xxxxxx shall provide the Agent and the Series Support
Provider with a copy of its annual budget for each upcoming fiscal year,
including statements of income and cash flows, and balance sheets, not later
than 30 days after the beginning of such fiscal year.
(i) The Servicer and the Trustee shall furnish to the
Agent and the Series Support Provider during the term of this Series 2002-A
Supplement, such periodic, special or other reports or information not
specifically provided for herein, as shall be necessary, reasonable and
appropriate as shall be requested by the Agent or the Series Support Provider,
all such reports or information to be provided by and in accordance with
reasonable instructions and directions as the Agent or the Series Support
Provider may reasonably require and as the Servicer and the Trustee may
reasonably be able to produce. In furtherance of, and not in limitation of the
foregoing, there shall be delivered to the Agent and the Series Support Provider
by the Trustee, promptly following the Trustee's receipt thereof, copies of (i)
each Servicer's annual compliance statement delivered to the Trustee pursuant to
Section 6.07 of the Master Agreement, and (ii) each financial statement and
report delivered to the Trustee pursuant to Section 6.08 of the Master
Agreement. The Trustee's obligation under this Section 3.04(c) shall only
pertain to information provided by the Servicer to the Trustee or otherwise in
the Trustee's possession.
36
(j) The Trustee shall promptly, after any Responsible
Officer's receipt of copies thereof, or any Responsible Officer acquiring actual
knowledge thereof, send to the Agent and the Series Support Provider (at the
Servicer's expense):
(i) written notice of any breach by the Transferor, the
Obligor, the Obligors' Agent or the Servicer of any
of their respective representations, warranties or
covenants made in any of the Series 2002-A Related
Documents to which it is a party;
(ii) a copy of each Servicer compliance statement
delivered to the Trustee pursuant to Section 6.07 of
the Master Agreement;
(iii) a copy of each financial statement, Independent
Accountant's review, notice and report delivered to
the Trustee pursuant to Sections 6.08 and 12.04 of
the Master Agreement;
(iv) written notice of the occurrence of any Series Event
of Default or Event of Servicer Termination;
(v) written notice of any failure of the Trustee to
conform to the eligibility requirements for the
Trustee pursuant to Section 11.08 of the Master
Agreement;
(vi) written notice of the appointment of any co-trustee
or separate trustee by the Trustee pursuant to
Section 11.15 of the Master Agreement; and
(vii) copies of all other financial statements, reports,
information and/or notices as may be reasonably
requested by the Agent or the Series Support Provider
and, in each case, which has been received by or is
otherwise in the possession of the Trustee or to
which the Trustee would have access or would be
entitled to receive or request in accordance with the
terms of the Master Agreement;
provided, however, that in each case the Trustee shall only be required to send
such notices and other items to the Agent and the Series Support Provider to the
extent that the Trustee has itself received or has knowledge of the related
information. Except as may be specifically provided herein, the Trustee shall
have no obligation to seek to obtain any such information.
Section 3.05 Compliance With Withholding Requirements.
Notwithstanding any other provisions of this Series 2002-A Supplement or the
Master Agreement to the contrary, the Trustee, for and on behalf of, and at the
direction of the Servicer, shall comply with all federal withholding
requirements respecting payments (or advances thereof) to the Agent on behalf of
the Purchasers as may be applicable to instruments constituting indebtedness for
federal income tax purposes. Except as otherwise provided in the Note Purchase
Agreement, any amounts so withheld shall be treated as having been paid to the
Agent on behalf of the applicable Purchasers for all purposes of this Series
2002-A Supplement. In no event shall the consent of the Agent or any Purchasers
be required for any such withholding.
37
Section 3.06 Servicer Advances. No later than one Business Day
preceding each Settlement Date, if the Servicer determines that any Scheduled
Payment (or portion thereof), which was due and payable pursuant to a Series
2002-A Contract during the related Collection Period was not received by such
date, the Servicer may make a Servicer Advance in an amount up to the amount of
such delinquent Scheduled Payment (or portion thereof), to the extent that in
its sole discretion it determines it can recoup such amount from subsequent
Collections under the related Series 2002-A Contract. The Servicer shall remit
any Servicer Advances to the Series 2002-A Facility Account for application in
accordance with the terms of Section 3.03.
Section 3.07 Special Representations, Covenants and
Acknowledgements.
(a) With respect to the Series 2002-A Notes, the Obligor
and the Obligors' Agent does hereby represent and warrant, as of each Pledge
Date:
(i) Insolvency. Each of the Obligor and the Obligors'
Agent is Solvent and will remain Solvent after giving
effect to the issuance of the Series 2002-A Notes and
the transactions contemplated by this Series 2002-A
Supplement, the Master Facility Agreement and each
Series 2002-A Related Document to which it is a
party.
(ii) Principal Place of Business. Exhibit F hereto sets
forth the principal place of business, state of
incorporation or organization, and chief executive
office and the location of the Contract Files for the
Obligor and the Obligors' Agent.
(iii) Valid Pledge. Each Pledge constitutes the grant of a
perfected, first priority security interest in all
Pledged Property (other than any Equipment having an
Original Equipment Cost of $25,000 or less, with
respect to which such security interest is validly
granted, but may not be perfected or of first
priority) to the Trustee.
(iv) Governmental Authorization. Other than the filing of
the financing statements required hereunder, no
authorization or approval or other action by, and no
notice to or filing with, any governmental authority
or regulatory body is required for the due execution,
delivery and performance by the Obligor and the
Obligors' Agent of this Agreement, the Master
Facility Agreement and each Series 2002-A Related
Document to which it is a party except for such
authorizations, approvals, actions, notices and
filings as have already been obtained, taken or made.
(v) Accuracy of Information. All information heretofore
furnished in writing by the Obligor or the Obligors'
Agent to the Trustee, the Series Support Provider or
to the Agent for purposes of or in connection with
this Agreement, the Master Facility Agreement and
each Series 2002-A Related Document to which it is a
party or any Pledge is true, accurate and
38
complete in every material respect on the date such
information is stated or certified.
(vi) Names. In the past two years, none of the Obligor nor
the Obligors' Agent has used any corporate names,
trade names or assumed names other than the name in
which it has executed this Agreement.
(vii) No Adverse Selection. The Series 2002-A Contracts
have been, and will be, selected by the Obligors'
Agent in a manner that is not adverse to the
interests of the Trustee, the Series 2002-A
Noteholders or the Series Support Provider.
(viii) Eligibility. Each Series 2002-A Contract being
Pledged on such Pledge Date is an Eligible Contract.
(ix) No Event of Default. No Series Event of Default has
occurred and is continuing, nor does any situation
exist which, with the giving of notice and/or the
passage of time, would result in the occurrence of a
Series Event of Default.
(b) The Obligor, the Obligors' Agent, Xxxxxx and the
Servicer do hereby covenant, acknowledge and agree that:
(i) Access to Documentation. The Agent, the Series
Support Provider and any of their duly authorized
representatives, attorneys or accountants shall have
the same access to the documentation relating to the
Series 2002-A Trust Estate as the Trustee is provided
pursuant to Section 6.09 of the Master Agreement.
(ii) Servicer to Indemnify. The Servicer shall indemnify
the Agent, the Series Support Provider and the Series
2002-A Noteholders to the same extent and on the same
terms as the Trustee, pursuant to Section 8.01 of the
Master Agreement.
(iii) Certain Consents Required. The prior written consent
of the Series Support Provider and the Agent shall be
required for the Obligor to take any action described
in Section 14.03(a) or 14.03(b) of the Master
Agreement.
(iv) Notice of Return of Final Payment. The Servicer shall
give the Agent and the Series Support Provider notice
of any return of final payment given to the Trustee
pursuant to Section 5.06 of the Master Agreement, at
the same time such notice is given to the Trustee.
(v) Acknowledgement of Obligor. The Obligor hereby
confirms and acknowledges that, by its execution
hereof, (a) it shall be deemed to be a party to the
Master Agreement and to the Master Transfer Agreement
for the purpose of making all representations,
warranties and covenants, and
39
being bound by all obligations, applicable to the
Obligor thereunder, to the extent (and only to the
extent) such representations, warranties, covenants
and obligations relate to the Series 2002-A Note
and/or the Series 2002-A Trust Estate and (b) it
confirms the right and ability of the Obligors' Agent
to execute any and all Series 2002-A Documents on
behalf of such Obligor, and that the Obligors'
Agent's signature thereon shall have the same force
and effect as if the Obligor were a direct signatory
thereto.
(vi) Series Controlling Party. The parties hereto
acknowledge that so long as no Series Support
Provider Default shall have occurred and be
continuing, the Series Support Provider shall be the
"Series Controlling Party" with respect to the Series
2002-A Notes for purposes of the Master Agreement and
this Series 2002-A Supplement and that if a Series
Support Provider Default shall have occurred and be
continuing, the Agent shall be the "Series
Controlling Party" for purposes of the Master
Agreement and this Series 2002-A Supplement so long
as such Series Support Provider Default shall
continue.
(vii) Series Trustee Secured Obligations. The "Series
Trustee Secured Obligations" and the "Series Secured
Obligations" with respect to the Series 2002-A Notes
shall mean, collectively (a) all amounts due to the
Series 2002-A Noteholders for principal and interest
and under the Note Purchase Agreement and any amounts
owing under the Series 2002-A Related Documents, (b)
any amounts due to the Agent hereunder and under the
Note Purchase Agreement, either in its individual
capacity or on behalf of the Purchasers, (c) any fees
and expenses due to the Trustee or the Back-up
Servicer with respect to the Series 2002-A Notes, (d)
amounts due to the Series Support Provider hereunder
and under the Insurance Agreement and (e) any
payments due to any Hedge Counterparty with respect
to the Series 2002-A Note.
(viii) Series Secured Parties. The "Series Secured Parties"
with respect to the Series 2002-A Note are the
Trustee, the Series Support Provider, the Agent, the
Series 2002-A Noteholders, and each Hedge
Counterparty (the "Series 2002-A Secured Parties").
(ix) Original Servicer Fee Rate. The "Original Servicer
Fee Rate" with respect to the Series 2002-A Note is
the percentage set forth in the definition of
"Servicing Fee" herein.
(x) Original Issue Date. The "Original Issue Date" with
respect to the Series 2002-A Note is the Series
Closing Date.
(xi) Limitation of Allowable Prepayments. The Servicer
shall not accept any Prepayment unless the amount
received in connection therewith is at least equal to
the related Prepayment Amount as of such date, or, if
less, unless the Servicer makes a non-recoverable
deposit to the Master Facility
40
Account in the amount of any shortfall (which
non-recoverable deposit shall be a "Collection" with
respect to the Series 2002-A Trust Estate).
(xii) Limitation on Removals. Notwithstanding Section
6.12(b) of the Master Agreement, the Servicer may not
remove any Contract pursuant to such Section 6.12(b)
if the aggregate of the Contract Principal Balances
removed pursuant to such Section exceeds ten percent
(10%) of the Maximum Series Limit.
(xiii) Series Controlling Party to Appoint Successor
Servicer with Respect to this Series. The Series
Controlling Party shall have the right to appoint a
successor Servicer with respect to the Series 2002-A
Contracts in the event of an Event of Servicer
Termination.
(xiv) Terms of Take-Out. Immediately following each
Take-Out, the Net Investment shall be reduced to
zero.
(xv) Equipment Type. The Servicer will not change the
Equipment Type classifications on its servicing
system without the prior written consent of the
Series Controlling Party.
(xvi) Change in Credit and Collection Policy. There has
been no, nor shall there be any, material change in
the Credit and Collection Policy since April 9, 2002
without the prior written consent of the Agent and
the Series Support Provider.
(xvii) Alternative Committed Financing Facilities. Xxxxxx
shall at all times prior to the Termination Date
maintain one or more Committed Financing Facilities
in addition to this facility (none of which have any
credit support provided by the Series Support
Provider), providing for the committed financing, in
the aggregate, of not less than $32,500,000;
(xviii) ERISA. Except as may otherwise be imposed by law,
Xxxxxx has no obligation to provide, and will not
have any obligation to provide, post-retirement
medical or life insurance or other death benefits to
any person other than pursuant to the "Xxxxxx Leasing
Corporation 401(k) Profit Sharing Plan" (the "401 (k)
Plan"). Except with respect to the 401(k) Plan,
Xxxxxx, does not currently maintain, have an
obligation to contribute to or pay withdrawal
liability to, or have any other obligation with
respect to, any "pension plan" (within the meaning of
section 3(2) of ERISA) or any multiemployer plan
(within the meaning of section 3(37) of ERISA). For
purposes hereof, all references to "ERISA" shall be
deemed to refer to the Employee Retirement Income
Security Act of 1974 (and any sections of the Code),
as now in effect and as it may hereafter be amended
or modified, and all regulations promulgated
thereunder and all references to "Xxxxxx" in this
paragraph (xix) shall be deemed to refer to Xxxxxx
and all other entities with which Xxxxxx is
affiliated within the meaning of Section
41
414(b) and 415(h) of the Code, as amended by ERISA,
and Sections 210(c) and 4001(a)(2) of ERISA.
(xix) Substitute Contracts. Any Substitute Contract
delivered to the Series 2002-A Trust Estate shall, if
delivered during the Amortization Period, in addition
to being an Eligible Contract, have substantially
similar characteristics as the Replaced Contract.
Section 3.08 Hedging Arrangements.
(a) Xxxxxx shall provide for one or more Hedge
Agreement(s) with respect to the Series 2002-A Trust Estate with an aggregate
notional balance at least equal to the principal portion of the Net Investment.
Each Hedge Agreement shall:
(i) provide for payments on each Settlement Date (x)
which, in the case of a Cap Agreement, are made only
by the Hedge Counterparty to the Trustee, in an
amount equal to the current notional amount of the
Hedge Agreement applied to the excess, if any, of the
Base LIBO Rate over the Hedge Rate with respect
thereto, and (y) in the case of a Swap Agreement, are
to be made (1) by the Hedge Counterparty to the
Trustee in an amount equal to the current notional
amount of the Swap Agreement applied to the Base LIBO
Rate, and (2) by the Trustee to the Hedge
Counterparty in an amount equal to such notional
amount applied to the Hedge Rate with respect thereto
(which amounts may be netted, with the net amount
paid by one party to the other);
(ii) be satisfactory in form and substance to the Series
Support Provider and the Agent;
(iii) provide that all payments made by the Hedge
Counterparty thereunder shall be made directly into
the Series 2002-A Facility Account;
(iv) provide for termination at the option of the Trustee
upon release of the related Series 2002-A Contracts
from the Lien of the Indenture;
(v) require the Hedge Counterparty to find a replacement
Hedge Counterparty to execute a new Hedge Agreement
satisfactory to the Series Support Provider and the
Agent within 10 Business Days of any downgrade of the
ratings of the Hedge Counterparty below the levels
set forth in the definition of "Hedge Counterparty",
which replacement must meet the qualifications set
forth in the definition of "Hedge Counterparty"; and
(vi) be between the related Hedge Counterparty and the
Trustee;
(b) In the event that a Hedge Counterparty no longer
satisfies the ratings requirement specified in the definition thereof and does
not itself find a replacement which has executed a Hedge Agreement as required
under clause (v) of Section 3.08(a), Xxxxxx shall be required, within 15
Business Days following the failure of such Hedge Counterparty to satisfy
42
such ratings requirement, to provide a substitute Person satisfying the
requirements of the definition of Hedge Counterparty to be substituted as the
Hedge Counterparty under the applicable Hedge Agreement(s) or to enter into a
new Hedge Agreement satisfactory to the Series Support Provider and the Agent.
(c) The Trustee shall not designate an "Early Termination
Date" under any Hedge Agreement following any "Event of Default" or "Termination
Event" thereunder without the prior written consent of the Series Controlling
Party, and must designate such an "Early Termination Event" at the Series
Controlling Party direction if the circumstances would permit the Trustee to
then make such a designation.
(d) The Trustee shall promptly forward to the Series
Controlling Party a copy of any notice received from a Hedge Counterparty
relating to any downgrade, withdrawal or suspension of such Hedge Counterparty's
(or such Hedge Counterparty's guarantor's) ratings.
(e) The Trustee shall not execute any assignment,
assumption, credit support annex, extension, amendment, modification, waiver,
confirmation, designation of "Reference Market Makers," schedule or other
agreement in connection with any Hedge Agreement without first obtaining the
prior written consent of the Series Controlling Party. A copy of any such item
received by the Trustee, together with a copy of any other notice or
communication received by the Trustee in connection with any Hedge Agreement
shall be forwarded to the Series Controlling Party promptly on receipt. Notice
of (i) any assignment or transfer by a Hedge Counterparty of any of its rights
or obligations under any Hedge Agreement (ii) any assumption, amendment,
extension, modification, waiver or event of default under any Hedge Agreement,
and (iii) the Hedge Counterparties entering into any new Hedge Agreement shall
be given by the Trustee to each Rating Agency.
Section 3.09 Lockbox Account.
(a) The Servicer shall establish a Lockbox Account
identified as "the Lockbox Account for Xxxxxx Master Facility Agreement, in
trust for the Series 2002-A Secured Parties" on behalf of, and in the name of,
MLR II LLC, which shall be an Eligible Bank Account. The Servicer shall direct
each User to make all payments with respect to the Series 2002-A Contracts which
are due after the related Pledge Date directly to the Lockbox Account. Any
notice delivered pursuant to the preceding sentence of this Section 3.09 after
the date hereof shall provide that (i) it is irrevocable except by, or a notice
accompanied by written consent of, the Series Controlling Party and (ii) the
User will only be discharged from its obligations under the Series 2002-A
Contract to the extent payments are sent to the Lockbox Account.
(b) The Servicer shall issue and maintain a standing
instruction to the Lockbox Bank under the Lockbox Agreement to the effect that
(x) on each Business Day the Lockbox Bank shall (i) cause all items received in
the post-office box related to the Lockbox Account since the preceding Business
Day relating to the Series 2002-A Contracts to be deposited into the Lockbox
Account, and (ii) remit by electronic funds transfer, into the Series 2002-A
Facility Account all available funds on deposit in the Lockbox Account and (y)
if the Lockbox Bank receives a written notice from the Series Controlling Party
stating that a Series Event of Default has occurred hereunder, the Lockbox Bank
shall thereafter follow such
43
directions as it may thereafter receive from the Series Controlling Party with
respect to Collections on the Series 2002-A Contracts, and shall not thereafter
follow any directions of the Servicer (unless otherwise directed by the Series
Controlling Party). Such standing instruction shall be evidenced by an agreement
with the Lockbox Bank in form and substance acceptable to the Series Controlling
Party. The Servicer will transfer any payments it receives directly rather than
by payment to the Lockbox Account by or on behalf of the Users pursuant to the
Contracts and all Recoveries in respect thereof to the Series 2002-A Facility
Account immediately upon receipt thereof.
(c) Neither the Servicer, any Obligor nor any Affiliate
thereof shall direct or shall have directed any payments to be remitted to the
Lockbox Account unless such payments relate to the Series 2002-A Contracts, or
to Contracts relating to other Series of Notes assigned to Group A.
ARTICLE IV
SERIES PRINCIPAL AMOUNT FOR SERIES 2002-A
Section 4.01 Advances.
(a) The Trustee shall deliver the Series 2002-A Note when
authenticated as directed in writing by the Obligor, and in accordance with
Section 5.01 of the Master Agreement.
(b) The Agent on behalf of the Series 2002-A Noteholders
agrees, by its acceptance of the Series 2002-A Note, that the Obligors' Agent
may, during the Revolving Period, on any Business Day, but not more frequently
than weekly (a "Pledge Date"), request upon not less than three (3) Business
Days' prior written notice (to be delivered not later than 4:00 p.m. New York
time) in the form set forth in Exhibit G hereto (a "Pledge Notice") delivered to
the Agent, the Series Support Provider, the Servicer and the Trustee, and upon
satisfaction of the conditions set forth in the Note Purchase Agreement and in
this Section 4.01, that the Agent remit to the Obligors' Agent an amount, to the
extent received by the Agent from Purchasers under the Note Purchase Agreement,
representing an increase in the Series 2002-A Noteholders' investment in the
Series 2002-A Notes (each such increase in investment, an "Advance") in an
amount equal to the related Advance Amount, provided, however, that the
aggregate of the Advance Amounts which may be paid pursuant to this Section
4.01(b) and Section 4.01(e) shall not, in any calendar month, exceed a dollar
amount equal to 175% of Marlin's average monthly production (expressed in terms
of the aggregate Equipment cost relating to Marlin's lease originations and
purchases) during the immediately preceding six months; provided, further,
however, that if no amount is paid pursuant to this Section 4.01(b) in any
calendar month, then the maximum amount which may be paid pursuant to this
Section 4.01(b) during the immediately following calendar month shall be the sum
of the maximum Advance Amount for such calendar month and the immediately
preceding calendar month.
(c) The Obligor shall Pledge the Pledged Property to the
Trustee to be held in trust as part of the Series 2002-A Trust Estate in
connection with the delivery of each Pledge Notice. Each Pledge Notice shall
specify:
44
(i) the proposed Pledge Date,
(ii) the related List of Contracts, which shall also
include for each Series 2002-A Contract and the
related discounted Booked Residual;
(iii) the amount of the related Advance Amount, which shall
not be less than $1,000,000 except as provided in
paragraph (e) below;
(iv) the Purchase Price Percentage for such Pledge;
(v) the Hedge Rate applicable to such Series 2002-A
Contracts;
(vi) the aggregate Contract Principal Balance of all
Series 2002-A Contracts being Pledged; and
(vii) the Borrowing Base immediately prior to such Pledge
and the Pro Forma Borrowing Base.
(d) No Advance will be funded with respect to any Series
2002-A Contract unless:
(i) the Trustee has previously delivered its
Certification (as defined in the Collateral
Administration Agreement) with respect thereto, which
Certification shall indicate that (1) the Trustee is
holding the related Series 2002-A Contracts pursuant
to the Collateral Administration Agreement and (2)
there is no Deficiency (as defined in the Collateral
Administration Agreement) with respect to such Series
2002-A Contract;
(ii) no Series Event of Default or event which, with the
giving of notice and/or the passage of time, would
constitute a Series Event of Default, shall have
occurred and be continuing;
(iii) after giving effect to the proposed Advance, the Net
Investment shall not exceed the lesser of (x) the
Borrowing Base and (y) the Maximum Series Limit as of
such date;
(iv) the representations and warranties of the Obligor
under the Series 2002-A Related Documents are true
and correct in all material respects as of the
related Pledge Date, unless such representation and
warranty speaks only as of a particular date;
(v) the Termination Date has not occurred; and
(vi) the Agent and the Series Support Provider shall have
received all such other documents, opinions and other
information as it shall have reasonably requested not
fewer than ten Business Days in advance.
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(e) In addition to the provisions of paragraph (b) above,
in which a pledge of additional Series 2002-A Contracts results in an increase
in the Series 2002-A Note Balance, during the Revolving Period, a Pledge of
additional Series 2002-A Contracts may also be funded from the monthly cash
flow, as set forth in clause fifteenth of Section 3.03(a)(i). In connection with
such a Pledge, the Obligor, upon satisfaction of the applicable conditions set
forth in paragraphs (b), (c) and (d) above, may Pledge such additional Series
2002-A Contracts to the Trustee to hold in trust as part of the Series 2002-A
Trust Estate without receiving any additional Advance Amount from the
Purchasers, but in consideration of receiving the Advance Amount paid under
clause fifteenth of Section 3.03(a)(i) hereof, by delivering a Pledge Notice to
the Trustee, the Series Support Provider and the Agent, not less than three (3)
Business Days prior to the proposed Pledge Date (which shall be a Settlement
Date).
(f) In addition to the provisions of paragraphs (b) and
(e) above, in which a Pledge of additional Series 2002-A Contracts is funded by
the Purchasers, or is made to sustain the revolving nature of the facility, the
Obligor, upon satisfaction of the applicable conditions set forth in paragraphs
(c) and (d) above, may Pledge Pledged Property to the Trustee to be held in
trust as part of the Series 2002-A Trust Estate without receiving any additional
Advance Amount, by delivering a Pledge Notice to the Trustee not less than three
(3) Business Days prior to the proposed Pledge Date (which shall be a Business
Day, but need not be a Settlement Date).
(g) If a Purchaser makes an Advance in accordance with
paragraph (b) above, the Agent shall remit the related Advance Amount to the
Series 2002-A Facility Account or to such other account as the Obligors' Agent
may specify in writing, in same day funds, no later than 12:00 noon (New York
City time). The Servicer shall notify the Trustee and the Agent and the Series
Support Provider of the amount of such Advance Amount and shall appropriately
note such Advance Amount (and the increased Series 2002-A Note Balance) on the
next succeeding monthly Servicer's Certificate.
(h) The Agent shall and is hereby authorized to record on
the grid attached to the Series 2002-A Note (or at the Agent's option, in its
internal books and records) the date and amount of any Advance Amount paid by it
on behalf of a Purchaser, and each repayment thereof; provided, that failure to
make any such recordation on such grid or any error in such grid shall not
adversely affect the Agent's rights with respect to the full Series 2002-A Note
Balance and its right to receive interest payments in respect of the Series
2002-A Note Balance.
(i) The Obligors' Agent may, not earlier than one hundred
eighty (180) days prior to the expiration of the Termination Date, by written
notice to the Agent on behalf of the Purchasers and written notice to the Series
Support Provider, make request for Purchasers and the Series Support Provider to
extend the Termination Date for an additional period of two years. The Agent
shall give prompt written notice to the Purchasers of the Obligors' Agent's
request. Each Purchaser and the Series Support Provider shall make a
determination, in its sole and absolute discretion, not less than sixty (60)
days after receipt of such request as to whether or not it will agree to the
extension requested. The failure of each Purchaser to provide timely notice of
its decision to the Agent shall be deemed to constitute a refusal by such
Purchaser to extend the Termination Date. The Termination Date may only be
extended by 100% of the Purchasers and the Series Support Provider.
46
ARTICLE V
SERIES EVENTS OF DEFAULT
Section 5.01 Series Events of Default. If any one of the
following shall occur:
(a) the Obligor or the Servicer shall fail to make when
due and payable any payment or deposit required hereunder or under any other
Series 2002-A Related Document, in any case on or before the date occurring one
(1) Business Day after the date such payment or deposit shall become due; or
(b) the Obligor or the Transferor shall fail to perform
or observe any covenant with respect to such Person set forth in any Series
2002-A Related Document, and such failure shall remain unremedied for ten (10)
Business Days after receipt by the Obligors' Agent of written notice thereof by
the Trustee, the Series Support Provider or the Agent; or
(c) any representation or warranty made by the Obligor,
the Servicer or the Transferor in any Series 2002-A Related Document or in any
other document delivered pursuant thereto shall prove to have been incorrect
when made or deemed made and continues to be incorrect for a period of ten (10)
Business Days after the earlier to occur of (1) the discovery thereof by the
Obligor or (2) the receipt by the Obligors' Agent of written notice thereof from
the Trustee, the Series Support Provider or the Agent; or
(d) an Insolvency Event shall occur with respect to the
Transferor, the Obligor, the Obligors' Agent, or the Servicer; or
(e) the Net Investment exceeds the lesser of the Maximum
Series Limit and the Borrowing Base (x) for three consecutive Business Days or
(y) as of the close of business on any Settlement Date; or
(f) the Trustee on behalf of the Series 2002-A Secured
Parties shall fail to have a valid and perfected first priority security
interest in either (x) the Series 2002-A Contracts or (y) items of Equipment
having an Original Equipment cost in excess of $25,000 and, in the case of this
clause (y), relating to a material portion of the Equipment in the Series 0000-X
Xxxxx Xxxxxx;
(g) (x) the Obligor shall fail to pay any principal of or
premium or interest on any indebtedness when the same becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) or (y) the Servicer or the Transferor shall fail to pay any principal
of or premium or interest on any indebtedness having a principal amount of
$1,000,000 or greater when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or otherwise) and,
with respect to both clauses (x) and (y), any such failure shall continue after
the applicable grace period, if any, specified in the agreement or instrument
relating to such indebtedness; or any other default under any agreement or
instrument relating to any such indebtedness of any Obligor, the Servicer or the
Transferor or any other event shall occur and shall continue after the
applicable grace period, if any, specified in such agreement or instrument if
the effect of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such indebtedness; or any such
47
indebtedness shall be declared to be due and payable or required to be prepaid
(other than by a regularly scheduled required prepayment) prior to the stated
maturity thereof; or
(h) the failure by Xxxxxx to complete at least one
Take-Out during any "Take-Out Period"; where "Take-Out Period" shall mean (i)
for all such times that Xxxxxx and its subsidiaries have in place an aggregate
of at least $75 million in Committed Financing Facilities (exclusive of the
credit facility contemplated herein and the current $32.5 million Xxxxxx bank
facility), the fifteen month period commencing on the date on which the initial
Advance is funded under Section 4.01(b) hereof, and each fifteen month period
thereafter, or (ii) for all such times that Xxxxxx and its subsidiaries do not
have in place an aggregate of at least $75 million in Committed Financing
Facilities (exclusive of the credit facility contemplated herein and the current
$32.5 million Xxxxxx bank facility), the twelve month period commencing on the
date on which the initial Advance is funded under Section 4.01(b) hereof, and
each twelve month period thereafter; provided, that if a Market Disruption Event
is determined by the Series Controlling Party to have occurred during the last
calendar month of any Take-Out Period, such Take-Out Period shall be extended
for a period of ninety (90) calendar days, and the following Take-Out Period
shall commence at the end of such extended period;
(i) an Event of Servicer Termination shall have occurred
and be continuing; or
(j) a material adverse change shall occur in the
operations or financial condition of Xxxxxx, the Servicer, the Obligor or the
Obligors' Agent or any other event shall occur the effect of which is to
materially and adversely affect the collectibility of the Contracts generally or
the ability of Xxxxxx, the Servicer, the Obligor or the Obligors' Agent to
perform its respective duties under the Series 2002-A Related Documents; or
(k) Xxxxxx shall (i) default on a payment obligation (and
such default is not cured within any applicable cure period and which default is
not waived) or a termination event shall occur, in either case, with respect to
any on or off-balance sheet financing or (ii) default (in a manner other than a
payment default) on any debt obligation with an outstanding balance in excess of
$1,000,000; or
(l) Xxxxxx ceases to own (directly or indirectly) one
hundred percent of the capital stock or membership interests of the Obligor; or
(m) the rating of the claims paying ability of the Series
Support Provider is reduced to below BBB- by S&P or below Baa3 by Xxxxx'x; or
(n) a Series Support Provider Default shall have
occurred, and the Series Support Provider is not replaced within forty-five (45)
calendar days with a surety provider, the financial strength of which is rated
"AAA" by Standard & Poor's and "Aaa" by Xxxxx'x, and provides a surety bond
substantially identical to the Series Support in all respects (including the
level of the premiums with respect thereto);
(o) Xxxxxx, the Transferor, the Obligors' Agent, the
Servicer or the Obligor shall enter into any transaction or merger in which it
is not the surviving entity;
48
(p) at any time, the Three-Month Rolling Average 31 to 60
Day Portfolio Delinquency Ratio exceeds 8.0%, or the Three-Month Rolling Average
61 to 90 Day Portfolio Delinquency Ratio exceeds 2.0%, or the Three-Month
Rolling Average 91 Plus Day Portfolio Delinquency Ratio exceeds 1.5% or the
Three-Month Rolling Average Portfolio Charged-Off Ratio is in excess of 3.0%;
(q) during the Revolving Period only, the Three-Month
Rolling Average 31 to 60 Day Delinquency Ratio exceeds 8.0%, or the Three-Month
Rolling Average 61 to 90 Day Delinquency Ratio exceeds 2.0%, or the Three-Month
Rolling Average 91 Plus Day Delinquency Ratio exceeds 1.5%, in each case which
is calculated for the first time in the fourth month after the Series Closing
Date or after a Take-Out, as applicable;
(r) during the Amortization Period only, the Three-Month
Rolling Average 31 to 60 Day Delinquency Ratio exceeds 8.0%, or the Three-Month
Rolling Average 61 to 90 Day Delinquency Ratio exceeds 2.0%, or the Three-Month
Rolling Average 91 Plus Day Delinquency Ratio exceeds 1.5%;
(s) at any time, the Three-Month Rolling Average
Charged-Off Ratio exceeds 3.0%, or the Charged-Off Ratio exceeds the Applicable
Trigger Charged-Off Ratio;
(t) Marlin's Tangible Net Worth as of the end of any
calendar quarter:
(i) is less than the sum of (x) $29,100,000 plus (y) 50%
of all of Marlin's positive net income earned since December 31, 2001;
(u) Marlin's Debt-to-Equity Ratio as of the end of any
calendar quarter exceeds 12.0;
(v) Marlin's annual audited financial statements are
qualified in any material manner;
(w) a Hedge Counterparty fails to satisfy the definition
thereof and is not replaced within forty-five (45) calendar days with a Person
satisfying the definition thereof;
(x) two out of three of Xxxxxx X. Xxxx, Xxxx Xxxxxxx or
Xxxx Xxxxxx are no longer officers of Xxxxxx, are no longer involved in the day
to day operations of Xxxxxx, or are unable to work for six consecutive months
and are not replaced by new personnel reasonably acceptable to the Series
Support Provider within 90 days of the occurrence of such event;
(y) as of any Settlement Date, the aggregate notional
balances applicable to all Hedging Agreements:
(i) if all such Hedging Agreements are Cap Agreements,
are less than the Net Investment as of such
Settlement Date; and
49
(ii) if not all such Hedging Agreements are Cap
Agreements:
(a) during the Revolving Period, are
less than or greater than the Net
Investment as of such Settlement
Date by an amount in excess of the
lesser of (x) one percent of the
Net Investment as of such
Settlement Date and (y) $250,000;
and;
(b) during the Amortization Period, are
less than or greater than the Net
Investment as of such Settlement
Date by an amount in excess of five
percent of the Net Investment as of
such Settlement Date;
(z) any Series 2002-A Note or any other Note shall cease
to constitute debt of the Obligor for federal income tax purposes;
(aa) any "Insurance Default" (as defined in the Insurance
Agreement) shall have occurred; or
(bb) the Interest Coverage Ratio as at the end of any
calendar quarter is less than 1.30:1 for the second fiscal quarter of 2002 and
thereafter, measured quarterly on a rolling four quarter basis;
(cc) the holders of a majority of Marlin's outstanding
preferred stock exercise any put rights or other similar rights such holders may
have in accordance with the terms and conditions of the Xxxxxx Leasing
Corporation Third Amended and Restated Stockholders Agreement dated as of July
26, 2001 (as may be amended); or
then, and in any such event, a "Series Event of Default" shall be deemed to have
occurred.
At any time following the occurrence and during the
continuance of any Series Event of Default, the Series Controlling Party may, by
notice to the Obligors' Agent, declare the occurrence of the Termination Date,
except that, in the case of any event described in subparagraph (d) above, the
Termination Date shall be deemed to have occurred automatically upon the
occurrence of such event.
Upon the declaration or automatic occurrence of the
Termination Date, the Series 2002-A Note and all other indebtedness and
liabilities of the Obligor and the Transferor to the Series 2002-A Secured
Parties shall become immediately due and payable, without any further act or
notice by any Person. Upon any occurrence of a Series Event of Default, the
Trustee and the Series 2002-A Secured Parties shall have, in addition to all
other rights and remedies under this Agreement or otherwise, all other rights
and remedies provided under the UCC of the applicable jurisdiction and other
applicable laws, which rights shall be cumulative; provided, however, that in
the absence of material fraud on the part of the Transferor, the Obligor or the
Servicer, and so long as no Series Event of Default shall have occurred under
clause (d) above, the Series Controlling Party shall not direct the Trustee to
liquidate the Series 2002-A Trust Estate during the ninety (90) day period
immediately following the occurrence of such Series Event of Default.
50
Any Series Event of Default, once declared, or any declaration
of the Termination Date, may be rescinded by the Series Controlling Party, on
such terms and conditions as may be stipulated by the Series Controlling Party
at such time.
The Trustee shall promptly send a written notice to Xxxxx'x
and to Standard & Poor's of the occurrence of, and the waiver of, any Series
Event of Default, to the extent that the Trustee has actual knowledge of, or has
received notice of, any such occurrence or waiver.
Section 5.02 Events of Servicer Termination.
(a) Upon the occurrence and continuation of Event of
Servicer Termination, the Trustee, at the direction of the Series Controlling
Party, shall, by notice (the "Servicer Termination Notice") then given in
writing to the Servicer, terminate all, but not less than all, of the rights of
the Servicer under this Series 2002-A Supplement; provided, further, that
notwithstanding Section 9.01 of the Master Agreement, in no event shall the
Servicer be terminated with respect to this Series 2002-A Supplement without the
prior consent of the Series Controlling Party.
(b) On and after the time the Servicer receives a
Servicer Termination Notice pursuant to this Section 5.02, all authority and
power of the Servicer under this Series 2002-A Supplement, whether with respect
to the Series 2002-A Notes or the Series 2002-A Trust Estate or otherwise, shall
pass to and be vested in the successor Servicer appointed pursuant to Section
5.05(a) of this Series 2002-A Supplement and, without limitation, such successor
Servicer is hereby authorized and empowered to execute and deliver, on behalf of
the Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such Servicer Termination Notice, whether
to complete the transfer of Series 2002-A Trust Estate and related documents or
otherwise.
(c) The Servicer agrees to cooperate with the Trustee and
the successor Servicer in effecting the termination of the responsibilities and
rights of the Servicer hereunder, including, without limitation, the transfer to
the successor Servicer for administration by it of all cash amounts that shall
at the time be held by the Servicer for deposit, or have been deposited by the
Servicer, in the Series 2002-A Accounts or thereafter received with respect to
the Series 2002-A Trust Estate. To assist the successor Servicer in enforcing
all rights with respect to any Related Security or under Broker Agreements and
Insurance Policies to the extent that they relate to the Contracts, the
Servicer, at its own expense, shall transfer its electronic records relating to
such Contracts to the successor Servicer in such electronic form as the
successor Servicer may reasonably request and shall transfer the related
Contract Files and all other records, correspondence and documents relating to
the Contracts that it may possess to the successor Servicer in the manner and at
such times as the successor Servicer shall reasonably request. In addition to
any other amounts that are then payable to the Servicer under this Series 2002-A
Supplement, the Servicer shall be entitled to receive reimbursement for any
unreimbursed Servicer Advances made during the period prior to the delivery of a
Servicer Termination Notice pursuant to this Section 5.02.
51
Section 5.03 Waiver of Past Defaults.
(a) Notwithstanding Section 9.04 of the Master Agreement,
the Series Controlling Party, on behalf of all Series 2002-A Noteholders, may
waive any default by the Servicer in the performance of its obligations
hereunder and its consequences in any Event of Servicer Termination as may be
defined herein, in the Master Agreement or in any Series Supplement. Any such
waiver must be in writing and be signed by the Series Controlling Party or the
Trustee acting on behalf (and at the direction) of the Series Controlling Party.
Upon any such waiver of a past default, such default shall cease to exist, and
any Event of Servicer Termination arising therefrom shall be deemed to have been
remedied for every purpose of this Series 2002-A Supplement or otherwise. No
such waiver shall extend to any subsequent similar or dissimilar default or
impair any right consequent thereon except to the extent expressly waived in
accordance with this Section 5.03.
(b) Notwithstanding Section 9.01 of the Master Agreement,
the Servicer shall not be terminated with respect to this Series 2002-A
Supplement and the Series 2002-A Trust Estate without the prior written consent
of the Series Controlling Party.
Section 5.04 Effects of Servicer Termination.
(a) Upon the appointment of the successor Servicer, the
terminated Servicer shall hold in trust for the Trustee and immediately remit
any Scheduled Payments, Residual Receipts, Recoveries, Overdue Payments,
Security Deposit, Insurance Proceeds, Advance Payments, Prepayments, and
proceeds of any Related Security that it may receive pursuant to any Contract,
any Broker Agreement, Insurance Policy or otherwise to the successor Servicer
for the benefit of the Trustee.
(b) After the delivery of a Servicer Termination Notice,
the terminated Servicer shall have no further obligations with respect to the
management, administration or servicing of the Series 2002-A Trust Estate or the
enforcement, custody or collection of the Contracts, and the successor Servicer
shall have all of such obligations, except (i) that the terminated Servicer will
transmit or cause to be transmitted directly to the successor Servicer for the
benefit of the Trustee promptly upon receipt and in the same form in which
received, any amounts held or received by the former Servicer (properly endorsed
where required for the successor Servicer to collect them) as payments upon or
otherwise in connection with Contracts or the Series 2002-A Trust Estate and
(ii) the terminated Servicer shall cooperate with the Trustee and the successor
Servicer in effecting the termination of its rights and responsibilities
hereunder and in assisting the successor Servicer in assuming the role of
Servicer and the transfer of the responsibility of Servicer hereunder. The
terminated Servicer's indemnification obligations pursuant to Section 8.01 of
the Master Agreement will survive its termination as the Servicer hereunder but
will not extend to any acts or omissions of any successor Servicer.
Section 5.05 Back-up Servicer to Act; Representations and
Warranties; Compensation of Back-up Servicer.
(a) In the event the Servicer is terminated pursuant to
Section 5.02 hereof, the Back-up Servicer shall, unless prevented by law,
automatically and without further action, be the
52
successor Servicer with respect to this Series 2002-A Supplement and the Series
2002-A Trust Estate. If the Back-up Servicer cannot serve as successor Servicer,
the Trustee shall appoint as successor Servicer with respect to this Series
2002-A Supplement and the Series 2002-A Trust Estate another firm acceptable to
it and the Series Controlling Party.
(b) The Back-up Servicer hereby confirms the accuracy, as
of the Series 2002-A Closing Date, of and hereby restates as of the Series
2002-A Closing Date the representations and warranties of the Back-up Servicer
set forth Section 9.11 of the Master Agreement.
(c) As compensation for its performance under this Series
2002-A Supplement, the Back-up Servicer shall receive the Back-up Servicer Fee
plus Transition Costs, if any.
Section 5.06 Additional Provisions with Respect to the Back-up
Servicer.
(a) The rights and obligations of the Back-up Servicer
under this Series 2002-A Supplement with respect to the Series 2002-A Trust
Estate shall not be terminated except at the written direction of the Series
Controlling Party and no Back-up Servicer Termination Notice may be delivered by
the Trustee to terminate the Back-up Servicer with respect to the Series 2002-A
Trust Estate without the prior written consent of the Series Controlling Party.
(b) Notwithstanding Section 9.09 of the Master Agreement,
any successor Back-up Servicer under this Series 2002-A Supplement with respect
to the Series 2002-A Trust Estate must be approved by the Series Controlling
Party, such approval not to be unreasonably withheld.
(c) The Back-up Servicer shall deliver to the Series
Support Provider a copy of any Back-up Servicer Resignation Notice delivered
with respect to this Series 2002-A Supplement and the Series 2002-A Trust Estate
pursuant to Section 9.09(b) of the Master Agreement.
(d) Subject to Section 5.06(b) hereof, any Person (i)
into which the Back-up Servicer may be merged or consolidated, (ii) which may
result from any merger or consolidation to which the Back-up Servicer is a
party, or (iii) which may succeed to the properties and assets of the Back-up
Servicer substantially as a whole, which Person in any of the foregoing cases
executes an agreement of assumption to perform every obligation of the Back-up
Servicer hereunder, shall be the successor to the Back-up Servicer under this
Series 2002-A Supplement without further act on the part of any of the parties
to this Series 2002-A Supplement; provided, however, that any such Person who is
the successor to the Back-up Servicer shall have a positive net worth following
such succession.
(e) The Back-up Servicer shall, upon reasonable prior
notice received by the Back-up Servicer, permit any representative of the Series
Support Provider, during the Back-up Servicer's normal business hours, to
examine all books of account, records, reports and other papers of the Back-up
Servicer relating to the Series 2002-A Notes, the Series 2002-A Trust Estate and
the Series 2002-A Related Documents, to make copies and extracts therefrom and
to discuss the Back-up Servicer's affairs and actions, as such affairs and
actions relate to the Back-up Servicer's duties with respect to the Series
2002-A Notes, the Series 2002-A Trust Estate and
53
the Series 2002-A Related Documents, with the Back-up Servicer's officers and
employees responsible for carrying out the Back-up Servicer's duties with
respect to the Series 2002-A Notes, the Series 2002-A Trust Estate and the
Series 2002-A Related Documents. All reasonable out-of-pocket expenses or costs
incurred by the Back-up Servicer in complying with this Section 5.06(e) shall be
borne by the party requesting such examination or discussion.
Section 5.07 Certain Matters Relating to the Trustee.
(a) Section 11.01(e) of the Master Agreement shall not
apply to this Series 2002-A Supplement or the Series 2002-A Trust Estate.
(b) The Trustee shall, upon reasonable prior notice
received by the Trustee, permit any representative of the Series Support
Provider, during the Trustee's normal business hours, to examine all books of
account, records, reports and other papers of the Trustee relating to the Series
2002-A Notes, the Series 2002-A Trust Estate and the Series 2002-A Related
Documents, to make copies and extracts therefrom and to discuss the Trustee's
affairs and actions, as such affairs and actions relate to the Trustee's duties
with respect to the Series 2002-A Notes, the Series 2002-A Trust Estate and the
Series 2002-A Related Documents, with the Trustee's officers and employees
responsible for carrying out the Trustee's duties with respect to the Series
2002-A Notes, the Series 2002-A Trust Estate and the Series 2002-A Related
Documents. All reasonable out-of-pocket expenses or costs incurred by the
Trustee in complying with this Section 5.07(b) shall be borne by the party
requesting such examination or discussion.
(c) If a Default or Event of Default occurs and is
continuing with respect to this Series 2002-A Supplement and the Series 2002-A
Notes and if it is known to a Responsible Officer of the Trustee, the Trustee
shall mail to each Series 2002-A Noteholder notice of such Default or Event of
Default promptly after it occurs and shall notify the Obligor, the Obligor's
Agent, the Transferors, the Series Support Provider and the Servicer of any such
Default or Event of Default promptly after it occurs. Notwithstanding Section
11.02 of the Master Agreement, the Trustee may not withhold the notice for any
reason, including, without limitation, if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interest of the Series 2002-A Noteholders.
Section 5.08 Resignation and Removal of Trustee. The Trustee
may at any time resign and be discharged from the trusts hereby created by
giving written notice thereof to the Obligor, the Servicer, the Rating Agencies,
the Agent and the Series Support Provider. Upon receiving such notice of
resignation, the Obligor shall promptly appoint a successor Trustee with the
prior written consent of the Series Controlling Party, such consent not to be
unreasonably withheld, by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor Trustee. If no successor trustee shall have been so appointed and have
accepted appointment within 60 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee, which successor Trustee
must be approved by the Series Controlling Party, such approval not to be
unreasonably withheld.
If at any time the Trustee shall cease to be eligible in
accordance with the provisions of the Master Agreement or this Supplement and
shall fail to resign after written
54
request therefor by the Obligor, the Servicer or the Series Controlling Party,
or if at any time the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or control
of the Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, or at any other time as the Series Controlling
Party may determine, then the Obligor (with the consent of the Series
Controlling Party) may, or the Series Controlling Party may, remove the Trustee
and appoint a successor Trustee reasonably acceptable to the Series Controlling
Party by written instrument, in duplicate, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant hereto shall become effective upon acceptance of
appointment by the successor Trustee as provided in Section 11.10 of the Master
Agreement.
Section 5.09 Control by Holders. The Series Controlling Party
shall have the right to direct the time, method and place of conducting any
Proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, with respect to the Series 2002-A Trust Estate;
provided, that
(i) such direction shall not be in conflict with any rule
of law, with the Master Agreement, the Series 2002-A
Supplement or the Series 2002-A Related Documents,
and
(ii) the Trustee may take any other action deemed proper
by the Trustee which is not inconsistent with such
direction.
ARTICLE VI
PREPAYMENT AND REDEMPTION
Section 6.01 Mandatory Prepayment. Notwithstanding any
limitation on recourse contained in this Series 2002-A Supplement or the Master
Agreement, if on any day, any Series 2002-A Contract is discovered not to have
been an Eligible Contract on its applicable Pledge Date, then the Obligor shall,
on or prior to the Business Day preceding the next following Settlement Date,
deliver to the Servicer for deposit in the Series 2002-A Facility Account, the
related Prepayment Amount. Upon payment in full by the Obligors' Agent to the
Servicer of the Prepayment Amount, the security interest of the Trustee in the
related Series 2002-A Contract and the Related Security shall be deemed
released, and the Trustee shall, upon written request, promptly deliver to the
Obligor any documents in the Trustee's possession evidencing the Series 2002-A
Contract and its interest in such Equipment related thereto and such Related
Security. The Trustee shall take all actions at the expense of and at the
request of the Servicer to ensure that such security interest is released,
including, at the Obligor's expense, execute such UCC-3 assignments, termination
statements and other documents as may reasonably be requested and prepared by
the Obligors' Agent.
55
Section 6.02 Optional Redemption.
(a) "Clean-Up Call" Redemption. On any Settlement Date
occurring on or after the date upon which the Series 2002-A Note Balance shall
have been reduced to an amount which is less than or equal to 15% of the Maximum
Series Limit, the Obligor shall have the option to redeem the outstanding Series
2002-A Note at a redemption price (the "Redemption Price") equal to the
outstanding Series 2002-A Note Balance of the Series 2002-A Notes, plus all
accrued and unpaid interest thereon and all fees and other amounts owing to the
Agent on behalf of the Purchasers in connection therewith or under the Series
2002-A Related Documents, together with any amounts then due the Series Support
Provider with respect to unreimbursed drawings under the Policy, together with
interest thereon, calculated at the rate set forth in the Insurance Agreement,
plus any amounts owing to the Series Support Provider under this Series 2002-A
Supplement, the Insurance Agreement and the Premium Letter, all as certified by
the Series Support Provider to the Trustee, the Agent and the Obligor's Agent.
The Obligors' Agent shall give the Servicer, the Trustee, the Series Support
Provider and the Agent at least 30 days' irrevocable prior written notice of the
date on which the Obligor intends to exercise such option to purchase. Not later
than 12:00 P.M., New York City time, on such Settlement Date the Obligor shall
remit such amount to the Agent and the Series Support Provider (by wire transfer
to an account to be designated by the Agent and the Series Support Provider, as
applicable, which designation may be a standing wire direction) in immediately
available funds. Such purchase option is subject to payment in full of the
Redemption Price. The Agent shall promptly thereafter distribute the applicable
amounts to each of the applicable Purchasers in accordance with their respective
interests therein.
Section 6.03 Tender of Series 2002-A Note. The Obligors' Agent
may request the Agent to tender to the Trustee all or a portion of the Series
2002-A Note that it then holds, provided that such tender shall only take place
if:
(a) (i) the Agent, the Series Support Provider and the
Trustee have received written and irrevocable notice on or before the last day
of the Collection Period most recently ended prior to, and in any event at least
30 days but no more than 40 days prior to any date set for such tender and the
Agent has consented to such tender (which consent shall not be unreasonably
withheld) and (ii) the Trustee shall have received written and irrevocable
notice of the election described in subsection (b)(i) and (b)(ii) below, and in
the event such election is that described in (b)(ii) such payment will be
deposited with the Trustee with instructions to pay the Agent;
(b) upon the date set for tender, the Agent shall receive
either (i) if it so elects, in lieu of payment, a new Series of Notes or (ii)
payment in an amount equal to the then Series 2002-A Note Balance being
tendered, plus interest accrued but unpaid on such Series 2002-A Note to, but
not including, the date of tender, together with all other fees and amounts then
due and payable or relating to the Series 2002-A Note Balance being tendered, or
to the related Series 2002-A Noteholders pursuant to the terms hereof, or of the
Note Purchase Agreement;
(c) there are no unreimbursed drawings then outstanding
under the Series Support nor are any amounts then due and payable to the Series
Support Provider hereunder or
56
under or in connection with the Series Support or the Insurance Agreement
(unless the Series Support Provider otherwise consents); and
(d) the purchaser of any Series 2002-A Notes so tendered
shall not be the Obligor or any Affiliate of the Obligor;
The provisions of this Section 6.03 shall apply whether or not
a Series Event of Default shall have occurred and then be in effect.
ARTICLE VII
MISCELLANEOUS
Section 7.01 Agent Authorized to Act for the Purchasers;
Notices. The parties hereto acknowledge that the Agent is authorized, pursuant
to the terms of the Note Purchase Agreement, to act for the Purchasers,
including, without limitation, for purposes of receiving distributions as
described in this Series 2002-A Supplement on behalf of such Purchasers.
Notwithstanding anything to the contrary in the Master Agreement or this Series
2002-A Supplement, the Trustee and the Servicer shall deliver all notices and
distributions to be made to the Agent as the registered owner of a Series 2002-A
Note and such delivery shall be deemed to comply with all requirements of the
Master Agreement. All notices, demands and requests to the Agent pursuant to the
Master Agreement or this Series 2002-A Supplement, in each case, be in writing
and shall be deemed duly given if personally delivered at, mailed by overnight
courier to, or sent by facsimile transmission to National City Bank, Asset
Securitization Division, 1 South Broad Street, 13th Floor, Locator 01-5997,
Xxxxxxxxxxxx, Xxxxxxxxxxxx, 00000, Fax 000.000.0000, or at such other address or
facsimile number as shall be designated by the Agent in a written notice to each
party hereto.
Section 7.02 Ratification of Master Agreement. As supplemented
by this Series 2002-A Supplement, the Master Agreement is in all respects
ratified and confirmed and the Master Agreement, as so supplemented by this
Series 2002-A Supplement shall be read, taken and construed as one and the same
instrument.
Section 7.03 Counterparts. This Series 2002-A Supplement may
be executed in one or more counterparts, each of which so executed shall be
deemed to be an original, but all of which shall together constitute but one and
the same instrument.
Section 7.04 GOVERNING LAW. THIS SERIES 2002-A SUPPLEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS WITHOUT TAKING INTO ACCOUNT THE
CONFLICT OF LAWS PRINCIPLES OF ANY JURISDICTION.
57
Section 7.05 Amendments and Waivers.
(a) Notwithstanding anything contained in the Master
Agreement to the contrary, no term or condition of this Series 2002-A Supplement
shall be amended, modified, waived or terminated without the prior written
consent of the Obligor, the Obligor's Agent, the Agent, the Servicer, the
Trustee and the Series Support Provider.
(b) No waiver with respect to any term or condition of
the Master Agreement or this Series 2002-A Supplement shall extend to any
subsequent or other event, circumstance or default or impair any right
consequent thereon except to the extent expressly so waived.
(c) Notwithstanding anything contained in Section 13.01
of the Master Agreement, without the consent of the Agent and of the Series
Support Provider, no Master Agreement Supplement or Supplements may be entered
into for the purpose of adding any provisions to, or changing in any manner or
eliminating any of the provisions of, the Master Agreement or any of the Series
2002-A Related Documents which Master Agreement Supplement or Supplements would
have the effect of modifying in any manner the rights of the Series Support
Provider or the Series 2002-A Noteholders under the Master Agreement, the Series
2002-A Supplement or the Series 2002-A Related Documents.
(d) Notice of any proposed amendment or waiver of this
Series 2002-A Supplement or of the Master Agreement or any of the Series 2002-A
Related Documents and a copy thereof shall be forwarded to the Series Support
Provider and each Series 2002-A Noteholder by the Servicer and the Series
Support Provider and each Series 2002-A Noteholder shall be provided with any
final executed amendment or waiver.
(e) Notice of any amendment of this Series 2002-A
Supplement or of the Master Agreement shall be forwarded to Standard & Poor's
and Xxxxx'x by the Servicer.
Section 7.06 Non-petition Clause. By its acceptance of the
Series 2002-A Note on behalf of the Purchasers, the Agent on behalf of itself
and the Purchasers shall be deemed to have agreed that prior to the date which
is one year and one day after the termination of the Master Agreement, such
Person shall not acquiesce, petition or otherwise invoke or cause the Obligor or
the Obligors' Agent to invoke the process of any Governmental Authority for the
purpose of commencing or sustaining a case against the Obligor under any Federal
or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of or for the Obligor or the Obligors' Agent or any substantial part of its
property or ordering the winding-up or liquidation of the affairs of the Obligor
or the Obligors' Agent.
Section 7.07 Certain Information. Certain information
concerning the Obligor or the Obligors' Agent and the Servicer is set forth in
Exhibit F hereto, which the Obligor or the Obligors' Agent and the Servicer
hereby represent and warrant to the Trustee, the Series Support Provider and the
Agent as being accurate.
Section 7.08 Series Support Provider as Third Party
Beneficiary. Each of the terms of this Series 2002-A Supplement and the Master
Agreement shall inure to the benefit of
58
the Series Support Provider, which shall be an express third party beneficiary
hereof and thereof, entitled to rely upon and directly enforce each of its
rights hereunder and thereunder.
Section 7.09 Termination. The obligations of the parties
hereto shall continue until all obligations owing to the Series 2002-A
Noteholders, the Series Support Provider and the Series 2002-A Secured Parties
herein and under the other Series 2002-A Related Documents have been
indefeasibly paid in full.
59
IN WITNESS WHEREOF, the Obligor, the Obligors' Agent, and
Xxxxxx, in its individual capacity and as the Servicer, the Agent and the
Trustee have caused this Series 2002-A Supplement to be fully executed by their
respective officers as of the day and year first above written.
XXXXXX LEASING CORPORATION, in its individual
capacity and as Servicer
By:__________________________________________
Name: Xxxxxx X. Xxxxxx
Title: Vice President
XXXXXX LEASING RECEIVABLES CORP. II,
as the Obligors' Agent
By:__________________________________________
Name: Xxxxxx X. Xxxxxx
Title: Vice President
XXXXXX LEASING RECEIVABLES II LLC,
as the Obligor
By: XXXXXX LEASING RECEIVABLES
CORP. II,
as Managing Member
By:__________________________________________
Name: Xxxxxx X. Xxxxxx
Title: Vice President
[Signature Page to Series 2002-A Supplement]
NATIONAL CITY BANK,
as Agent
By:__________________________________________
Name:_____________________________________
Title:____________________________________
XXXXX FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By:__________________________________________
Name:_____________________________________
Title:____________________________________
[Signature Page to Series 2002-A Supplement]
SCHEDULE 1
HEDGE COUNTERPARTIES
Barclays Bank PLC
ABN AMRO Bank N.V.
EXHIBIT A
FORM OF SERIES 2002-A NOTE
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND HAS NOT BEEN
APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR REGULATORY
AUTHORITY OF ANY STATE. THIS NOTE HAS BEEN OFFERED AND SOLD PRIVATELY. THE
HOLDER HEREOF ACKNOWLEDGES THAT THESE SECURITIES ARE "RESTRICTED SECURITIES"
THAT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND AGREES FOR THE
BENEFIT OF THE OBLIGORS AND THEIR AFFILIATES THAT THESE SECURITIES MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A (A)(1) A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A OR (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER JURISDICTION AND (B) A QUALIFIED PURCHASER WITHIN THE MEANING OF
THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED. THE TRANSFER OF THIS NOTE IS
SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE MASTER FACILITY AGREEMENT AND THE
SERIES SUPPLEMENT REFERRED TO HEREIN.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED TO AN EMPLOYEE
BENEFIT PLAN, TRUST OR ACCOUNT SUBJECT TO TITLE I OF THE EMPLOYMENT RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, OR DESCRIBED IN SECTION 4975(e)(1) OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, INCLUDING AN INDIVIDUAL
RETIREMENT ACCOUNT.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED, ASSIGNED,
EXCHANGED OR OTHERWISE PLEDGED OR CONVEYED, EXCEPT IN ACCORDANCE WITH THE MASTER
FACILITY AGREEMENT AND SERIES SUPPLEMENT REFERRED TO HEREIN.
A-1
No. 1 $75,000,000
XXXXXX LEASING RECEIVABLES MASTER ASSET-BACKED FINANCING FACILITY,
SERIES 2002-A NOTE
XXXXXX LEASING CORPORATION,
as the Servicer, and
XXXXXX LEASING RECEIVABLES II LLC,
as the Obligor
(Not an interest in or obligation of Xxxxxx Leasing Corporation, or its
affiliates, other than Xxxxxx Leasing Receivables II LLC)
This certifies that NATIONAL CITY BANK, as agent for NORTH
COAST FUNDING LLC (the "Series 2002-A Noteholder") is the registered owner of
this Series 2002-A Note (the "Series Note") issued by Xxxxxx Leasing Receivables
II LLC ("MLR II LLC"), (the "Obligor"), created pursuant to that certain Master
Lease Receivables Asset-Backed Financing Facility Agreement, dated as of April
1, 2002 (as the same may be further amended, restated, supplemented or otherwise
modified from time to time, the "Master Facility Agreement"), by and among
Xxxxxx Leasing Corporation (the "Servicer"), MLR II LLC, Xxxxxx Leasing
Receivables Corp. II ("MLR II"), as Obligors' Agent (in such capacity, the
"Obligors' Agent"), and Xxxxx Fargo Bank Minnesota, National Association, as
trustee and back-up servicer (the "Trustee")
To the extent not otherwise defined herein, capitalized terms
used herein have the meanings assigned in the Master Facility Agreement or the
Series Supplement (as hereinafter defined), as applicable. This Series Note is
issued under and is subject to the terms, provisions and conditions of the
Series 2002-A Supplement to the Master Facility Agreement, dated as of April 1,
2002 (as the same may be amended, restated, supplemented or otherwise modified
from time to time, the "Series Supplement") among the Servicer, the Obligor, the
Obligors' Agent, the Trustee and National City Bank, as Agent (the "Agent"), to
which the Series 2002-A Noteholder, by virtue of its acceptance hereof, assents
and by which the Series 2002-A Noteholder is bound.
The Obligor has pledged to the Trustee for the benefit of the
Series 2002-A Secured Parties, and the Trustee has accepted the pledge of, all
of the Obligor's now owned and existing and hereafter acquired or arising right,
title and interest in and to the Series 2002-A Trust Estate described in the
Series 2002-A Supplement.
It is the intent of the Obligor and the Series 2002-A
Noteholder that, for federal, state and local income and franchise tax purposes,
the Series Note will be evidence of indebtedness of the Obligor. The Obligor and
the Series 2002-A Noteholder, by the acceptance of this Series Note, agree to
treat this Series Note for federal, state and local income and franchise tax
purposes as indebtedness of the Obligor secured by the Series 2002-A Trust
Estate.
Subject to, and in accordance with, the terms and conditions
of the Series Note and the Series Supplement, the Series 2002-A Note Balance
(the "Series Note Balance") may
A-2
from time to time be increased; provided that the outstanding principal balance
of this Series Note shall not exceed the dollar amount first above written.
The Agent, on behalf of the Purchasers, is authorized to
record, on the schedule annexed thereto and made a part hereof or on other
appropriate records of the Agent, the date and amount of each Advance made by
the Purchasers, each continuation thereof, the interest rate from time to time
on each Advance and the date and amount of each payment or repayment of
principal thereof. Any such recordation shall constitute prima facie evidence of
the accuracy of the information so recorded, provided that the failure of the
Agent to make any such recordation (or any error in such recordation) shall not
affect the obligations of the Obligor hereunder or under the Series Supplement
and Master Facility Agreement in respect of this Series Note.
The Master Facility Agreement and the Series Supplement
permit, with certain exceptions, the amendment thereof and the modification of
the rights and obligations of the Obligor, the Servicer and the Trustee and the
rights of the Series 2002-A Noteholder under the Master Facility Agreement or
the Series Supplement at any time by the Servicer, the Obligor and the Trustee
without, in certain cases, the consent of the Series 2002-A Noteholder, as more
particularly described in the Master Facility Agreement and the Series
Supplement.
The transfer of this Series Note is subject to certain
restrictions set forth in the Master Facility Agreement, the Series Supplement
and the Note Purchase Agreement.
The Servicer, the Trustee and any agent of the foregoing may
treat the person in whose name this Series Note is registered as the owner for
all purposes, and none of the foregoing shall be affected by any notice to the
contrary.
Unless the certificate of authentication attached hereto has
been executed by or on behalf of the Trustee, by manual or facsimile signature,
this Series Note shall not be entitled to any benefit under the Master Facility
Agreement or the Series Supplement or be valid for any purpose.
A-3
IN WITNESS WHEREOF, the Obligor has caused this Series Note to
be duly executed and authenticated.
Dated as of [_________]
XXXXXX LEASING RECEIVABLES II LLC
By: XXXXXX LEASING RECEIVABLES
CORP. II, as Managing Member
By: _________________________________________
Title:
Attested:
By: _______________________________
Title:_____________________________
A-4
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Series Notes designated herein referred to
in the within-mentioned Master Facility Agreement and the within-mentioned
Series Supplement thereto.
[______________________________]
as Trustee
By:______________________________________
Authorized Signatory
A-5
SCHEDULE TO SERIES 2002-A NOTE
Amount Amount of Total Principal
Date of Advance Principal Repaid Outstanding
---- ---------- ---------------- ---------------
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
________________ $________________ __________________ __________________
A-6
EXHIBIT B
[RESERVED]
B-1
EXHIBIT C
Instructions for sending wires to the Agent on behalf of the Noteholders
pursuant to Section 3.03(b):
Bankers Trust Company
in the name of National City Bank
ABA: 021-001-0333
Acct No. 01419647
Ref: CTOL 033471
C-1
EXHIBIT D
FORM OF SERVICER'S CERTIFICATE
D-1
EXHIBIT E
FORM OF CONTRACTS
E-1
EXHIBIT F
PLACES OF BUSINESS OF THE OBLIGOR AND THE SERVICER; LOCATIONS OF RECORDS;
FEDERAL EMPLOYER IDENTIFICATION NUMBERS
A. Obligor
1. Xxxxxx Leasing Receivables II LLC
a. Chief Executive Office and Principal Place
of Business
000 Xxxxxx Xxxx, Xxxxx 000
Xxxx, Xxxxxx 00000
b. Other Locations of Records
000 Xxxxxxx Xxxxx, Xxxxx 000
Xx. Xxxxxx, Xxx Xxxxxx 00000
x. XXXX: 00-0000000
d. State of Organization: Nevada
B. Servicer
1. Xxxxxx Leasing Corporation
Chief Executive Office and Principal Place
of Business
000 Xxxxxxx Xxxxx, Xxxxx 000
Xx. Xxxxxx, Xxx Xxxxxx 00000
2. Other Locations of Records
None
3. Servicer's FEIN:
00-0000000
4. State of Incorporation:
Delaware
F-1
EXHIBIT G
FORM OF PLEDGE NOTICE
[DATE]
TO: National City Bank MBIA Insurance Corporation
0 Xxxxx Xxxxx Xxxxxx, 00xx Floor 000 Xxxx Xxxxxx
Xxxxxxx 00-0000 Xxxxxx, Xxx Xxxx 00000
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000 Attention: Insured Portfolio
Attention: Asset Securitization Division Management Structured
Finance
Xxxxxx Leasing
Xxxxxx Leasing Corporation
000 Xxxxxxx Xxxxx, Xxxxx 000 Xxxxx Fargo Bank Minnesota, N.A.
Xx. Xxxxxx, Xxx Xxxxxx 00000 Sixth Street and Marquette Avenue
Attention: Xxx Xxxx MAC N9311-161
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust
Services -
Asset Backed
Administration
Re: Xxxxxx Lease Receivables Master Facility, Series
2002-A Note
Ladies and Gentlemen:
Reference is made to that certain Series 2002-A Supplement,
dated as of April 1, 2002 (the "Series Supplement"), among Xxxxxx Leasing
Corporation II ("MLR II") and Xxxxxx Leasing Corporation (the "Servicer"),
Xxxxxx Leasing Receivables II LLC ("MLR II LLC" or the "Series Obligor"),
National City Bank, as agent, and Xxxxx Fargo Bank Minnesota, National
Association ("Xxxxx Fargo"), as trustee, and to that certain Master Lease
Receivables Asset-Backed Financing Facility Agreement, dated as of April 1, 2002
(the "Master Facility Agreement"), among the Servicer, MLR II and Xxxxx Fargo,
as trustee and back-up servicer. Capitalized terms used herein shall have the
meanings assigned to such terms in the Series Supplement and Master Facility
Agreement.
Pursuant to Section 4.01(b) of the Series Supplement, the
undersigned, a duly authorized representative of the Series Obligors, hereby
provide notice of an increase in the Series 2002-A Note Balance (each amount, an
"Advance Amount"), and in that connection sets forth below the information
relating to such proposed increase, as required by Section 4.01(c) of the Series
Supplement:
(i) The aggregate amount of the related Advance Amount is
$____________.
G-1
(ii) The date on which such Advance Amount shall occur is
_______________.
(iii) Attached hereto as Exhibit A is the related List of Contracts.
(iv) The Purchase Price Percentage applicable to the Pledge is
___%.
(v) The Hedge Rate applicable to such Series 2002-A Contracts
being Pledged is ____%.
(vi) The aggregate Contract Principal Balance of all Series 2002-A
Contracts being Pledged is $_____________.
(vii) The Borrowing Base immediately prior to such pledge is
$__________, and the Pro Forma Borrowing Base is $__________.
The undersigned certifies that as of the date hereof and on
the date of the proposed Advance Amount, all of the conditions precedent to the
proposed Advance Amount set forth in Section 4.01 of the Series Supplement have
been satisfied.
Very truly yours,
XXXXXX LEASING RECEIVABLES
CORP. II, as the Obligors' Agent
By:_______________________________
Name:
Title:
XXXXXX LEASING RECEIVABLES LLC II
By: XXXXXX LEASING RECEIVABLES
CORP. II, as Managing Member
By:___________________________
Name:
Title:
G-2
