EXCHANGE NOTE SALE AGREEMENT dated as of April 17, 2024 between AUTO LEASE FINANCE LLC, as Seller and WORLD OMNI AUTO LEASING LLC, as Buyer
Exhibit 10.1
EXCHANGE NOTE SALE AGREEMENT |
dated as of April 17, 2024 |
between |
AUTO
LEASE FINANCE LLC, as Seller |
and |
WORLD
OMNI AUTO LEASING LLC, as Buyer |
Table of Contents
Page
Article I DEFINITIONS | 1 | |
Section 1.1 | Certain Terms | 1 |
Section 1.2 | Other Definitional Provisions | 1 |
Section 1.3 | Other Terms | 2 |
Section 1.4 | Computation of Time Periods | 2 |
Article II PURCHASE AND CONTRIBUTION | 2 | |
Section 2.1 | Agreement to Sell and Contribute | 2 |
Section 2.2 | Consideration and Payment | 2 |
Section 2.3 | Representations, Warranties and Covenants | 2 |
Section 2.4 | Protection of Title | 8 |
Section 2.5 | Other Adverse Claims or Interests | 9 |
Article III MISCELLANEOUS | 9 | |
Section 3.1 | Transfers Intended as Sale; Security Interest | 9 |
Section 3.2 | Specific Performance | 10 |
Section 3.3 | Notices, Etc. | 10 |
Section 3.4 | Choice of Law | 11 |
Section 3.5 | Counterparts; Electronic Signatures | 11 |
Section 3.6 | Amendment | 11 |
Section 3.7 | Waivers | 12 |
Section 3.8 | Entire Agreement | 12 |
Section 3.9 | Severability of Provisions | 12 |
Section 3.10 | Binding Effect; Assignability | 13 |
Section 3.11 | Acknowledgment and Agreement | 13 |
Section 3.12 | No Waiver; Cumulative Remedies | 13 |
Section 3.13 | Nonpetition Covenant | 13 |
Section 3.14 | Each Exchange Note Separate; Assignees of Exchange Note | 13 |
Section 3.15 | Submission to Jurisdiction; Waiver of Jury Trial | 14 |
Schedule I Perfection Representations, Warranties and Covenants
i
THIS EXCHANGE NOTE SALE AGREEMENT is made and entered into as of April 17, 2024 (as amended, supplemented or modified from time to time, this “Agreement”) by AUTO LEASE FINANCE LLC, a Delaware limited liability company (the “Seller”), and WORLD OMNI AUTO LEASING LLC, a Delaware limited liability company (the “Buyer”).
WHEREAS, World Omni LT is a Delaware statutory trust (the “Titling Trust”) formed and operated pursuant to that certain Second Amended and Restated Trust Agreement dated as of July 16, 2008 (as amended, modified or supplemented from time to time, the “Titling Trust Agreement”) for the purpose, among other things, of acquiring title to Closed-End Units and issuing Exchange Notes, relating to separate Reference Pools of Closed-End Units within the Closed-End Collateral Specified Interest in the Titling Trust;
Article I
DEFINITIONS
Section 1.2 Other Definitional Provisions
(a) Each term defined in the singular form in this Agreement shall mean the plural thereof when the plural form of such term is used in this Agreement or any certificate, report or other document made or delivered pursuant hereto, and each term defined in the plural form in shall mean the singular thereof when the singular form of such term is used herein or therein.
(b) The words “hereof”, “herein”, “hereunder” and similar terms when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and article, section, subsection, schedule and exhibit references herein are references to articles, sections, subsections, schedules and exhibits to or of this Agreement unless otherwise specified.
Article II
PURCHASE AND CONTRIBUTION
Section 2.3 Representations, Warranties and Covenants.
2
3
The representations and warranties set forth in this Section 2.3(a) shall speak only as of the date hereof and shall survive the sale of the Exchange Note hereunder.
(c) Reallocation Upon Breach of Representations and Warranties. Upon discovery by the Buyer or the Seller of a breach of the representations and warranties set forth in Section 2.3(b) at the time such representations and warranties were made which materially and adversely affects the interests of the Issuing Entity, in its indirect capacity as the Exchange Noteholder, in any Transaction Unit, the party discovering such breach shall give prompt written notice thereof to the other parties. If the Seller (i) has knowledge of a breach of a representation or warranty made in Section 2.3(b), (ii) receives notice from the Depositor, the Issuing Entity, the Owner Trustee or the Indenture Trustee of a breach of a representation or warranty made in Section 2.3(b), (iii) receives a Reallocation Request from the Owner Trustee or the Indenture Trustee for a Unit or (iv) receives a Review Report that indicates a Test Fail for a Transaction Unit, then, in each case, the Seller will (or cause World Omni to) investigate the Transaction Unit to confirm the breach and determine if the breach materially and adversely affects the interests of the Issuing Entity, in its indirect capacity as the Exchange Noteholder. None of the Titling Trust, the Titling Trustee, the Titling Trustee Agent, the Closed-End Collateral Agent, the Initial Beneficiary, the Servicer, the Issuing Entity, the Owner Trustee, the Indenture Trustee, the Asset Representations Reviewer or the Administrator will have an obligation to investigate whether a breach of any representation or warranty has occurred or whether any Transaction Unit is required to be reallocated under this Section 2.3(c). If the Seller does not correct or cure such breach prior to the end of the Collection Period after the date that the Seller had knowledge or was notified of such breach, then the Seller shall direct the Closed-End Administrative Agent and the Servicer to reallocate the noncompliant Closed-End Units from the 2024-A Reference Pool to the Warehouse Facility Pool or an Unencumbered Reference Pool on the Closed-End Exchange Note Payment Date following the end of such Closed-End EN Collection Period. In consideration for such reallocation, the Seller shall be required to deposit an amount equal to the Securitization Value of such noncompliant Closed-End Units into the Exchange Note Collection Account as of the end of the Closed-End EN Collection Period preceding such Closed-End Exchange Note Payment Date prior to 11 a.m., New York City time, on the Business Day preceding such Closed-End Exchange Note Payment Date, in order for the Closed-End Administrative Agent to apply such amount to the payment of principal of the Exchange Note. It is understood and agreed that the obligation of the Seller to deposit such amount (the “Repurchase Payment”) relating to the Closed-End Lease as to which such a breach has occurred and is continuing as described above shall constitute the sole remedy respecting such breach available to the Buyer and any other Person. None of the Servicer, the Issuing Entity, the Owner Trustee, the Indenture Trustee, the Titling Trustee, the Closed-End Collateral Agent, the Closed-End Administrative Agent, the Asset Representations Reviewer, the Seller, the Depositor or the Administrator will have an obligation to investigate whether a breach or other event has occurred that would require the reallocation of any Transaction Unit under this Section 2.3(c) or whether any Transaction Unit is required to be reallocated under this Section 2.3(c).
4
(ii) Mediation. If the Requesting Party selects mediation for dispute resolution:
(A) The mediation will be administered by the ADR Organization using its ADR Rules. However, if any ADR Rules are inconsistent with the procedures for mediation stated in this Section 2.3(d), the procedures in this Section 2.3(d) will control.
5
(B) A single mediator will be selected by the ADR Organization from a list of neutral mediators maintained by it according to the ADR Rules. The mediator must be impartial, an attorney admitted to practice in the State of New York and have at least 15 years of experience in commercial litigation and, if possible, consumer finance or asset-backed securitization matters.
(C) The mediation will start within 15 days after the selection of the mediator and conclude within 30 days after the start of the mediation.
(D) Expenses of the mediation will be allocated among the parties as mutually agreed by them as part of the mediation.
(E) If the parties fail to agree at the completion of the mediation, the Requesting Party may refer the Reallocation Request to binding arbitration under this Section 2.3(d) or may seek adjudication of the Reallocation Request in court.
(iii) Binding Arbitration. If the Requesting Party selects arbitration for dispute resolution:
(A) The arbitration will be administered by the ADR Organization using its ADR Rules. However, if any ADR Rules are inconsistent with the procedures for arbitration stated in this Section 2.3(d), the procedures in this Section 2.3(d) will control.
(B) A single arbitrator will be selected by the ADR Organization from a list of neutral arbitrators maintained by it according to the ADR Rules. The arbitrator must be impartial, an attorney admitted to practice in the State of New York and have at least 15 years of experience in commercial litigation and, if possible, consumer finance or asset-backed securitization matters. The arbitrator will be independent and impartial and will comply with the Code of Ethics for Arbitrators in Commercial Disputes in effect at the time of the arbitration. Before accepting an appointment, the arbitrator must promptly disclose any circumstances likely to create a reasonable inference of bias or conflict of interest or likely to preclude completion of the proceedings within the stated time schedule. The arbitrator may be removed by the ADR Organization for cause consisting of actual bias, conflict of interest or other serious potential for conflict.
6
(C) The arbitrator will have the authority to schedule, hear and determine any motions, including dispositive and discovery motions, according to New York law, and will do so at the motion of any party. Discovery will be completed within 30 days of selection of the arbitrator and will be limited for each party to two witness depositions not to exceed five hours, two interrogatories, one document request and one request for admissions. However, the arbitrator may grant additional discovery on a showing of good cause that the additional discovery is reasonable and necessary. Briefs will be limited to no more than ten pages each, and will be limited to initial statements of the case, motions and a pre-hearing brief. The evidentiary hearing on the merits will start no later than 60 days after selection of the arbitrator and will proceed for no more than six consecutive Business Days with equal time allocated to each party for the presentation of evidence and cross examination. The arbitrator may allow additional time for discovery and hearings on a showing of good cause or due to unavoidable delays.
(D) The arbitrator will make its final determination no later than 90 days after its selection. The arbitrator will resolve the dispute according to the terms of this Agreement and the other Transaction Documents, and may not modify or change this Agreement or the other Transaction Documents in any way or award remedies not consistent with the Transaction Documents. The arbitrator will not have the power to award punitive damages or consequential damages in any arbitration conducted by them. In its final determination, the arbitrator will determine and award the expenses of the arbitration (including filing fees, the fees of the arbitrator, expense of any record or transcript of the arbitration and administrative fees) to the parties in its reasonable discretion; provided, that, notwithstanding any other provision of this Agreement or any other document, under no circumstances whatsoever will the Owner Trustee be liable for any such costs, expenses, and/or liabilities that could be allocated to a Certificateholder as the Requesting Party. The determination of the arbitrator will be in writing and counterpart copies will be promptly delivered to the parties. The determination will be final and non-appealable, except for actions to confirm or vacate the determination permitted under federal or State law, and may be entered and enforced in any court of competent jurisdiction over the parties and the matter.
(E) By selecting binding arbitration, the Requesting Party is giving up the right to sue in court, including the right to a trial by jury.
(F) The Requesting Party may not bring a putative or certificated class action to arbitration. If this waiver of class action rights is found to be unenforceable for any reason, the Requesting Party agrees that it will bring its claims in a court of competent jurisdiction.
(iv) Additional Conditions. For each mediation or arbitration:
(A) Any mediation or arbitration will be held in New York, New York at the offices of the mediator or arbitrator or, if mediation or arbitration in New York, New York at the offices of the mediator or arbitrator is unavailable, the mediator or arbitrator will select another location in a major metropolitan area in the continental United States. Any party or witness may participate by teleconference or video conference.
7
(B) The Seller and the Requesting Party will have the right to seek provisional relief from a competent court of law, including a temporary restraining order, preliminary injunction or attachment order, if such relief is available by law.
(v) The Seller will not be required to produce Personally Identifiable Information for purposes of any mediation or arbitration. The existence and details of any unresolved Reallocation Request, any informal meetings, mediations or arbitration proceedings, the nature and amount of any relief sought or granted, any offers or statements made and any discovery taken in the proceeding will be confidential, privileged and inadmissible for any purpose in any other mediation, arbitration, litigation or other proceeding. The parties will keep this information confidential and will not disclose or discuss it with any third party (other than a party’s attorneys, experts, accountants and other advisors, as reasonably required in connection with the mediation or arbitration proceeding under this Section 2.3), except as required by law, regulatory requirement or court order. If a party to a mediation or arbitration proceeding receives a subpoena or other request for information from a third party (other than a governmental regulatory body) for confidential information of the other party to the mediation or arbitration proceeding, the recipient will promptly notify the other party and will provide the other party with the opportunity to object to the production of its confidential information. Nothing in this Section 2.3(d) shall prevent the Noteholders or Note Owners from exercising their rights under Section 7.2(e) of the Indenture or the Servicer or the Depositor from complying with its disclosure requirements under Item 1121 of Regulation AB.
Section 2.4 Protection of Title.
8
Article III
MISCELLANEOUS
Section 3.1 Transfers Intended as Sale; Security Interest.
(a) Each of the parties hereto expressly intends and agrees that the transfers contemplated and effected under this Agreement are complete and absolute sale and contribution rather than pledges or assignments of only a security interest and shall be given effect as such for all purposes. The sale and contribution of the Exchange Note shall be reflected on the Seller’s balance sheet and other financial statements as a sale and contribution of assets by the Seller. The sales and contributions by the Seller of the Exchange Note shall be without recourse to, or representation or warranty (express or implied) by, the Seller, except as otherwise specifically provided herein. The limited rights of recourse specified herein against the Seller are intended to provide a remedy for breach of representations and warranties relating to the condition of the property sold, rather than to the collectibility of underlying indebtedness, and therefore are intended to be consistent with warranties ordinarily given by a seller of goods under Article 2 of the UCC.
9
(b) Notwithstanding the foregoing, in the event that the Exchange Note is held to be property of the Seller, or if for any reason this Agreement is held or deemed to create a security interest in the Exchange Note, then it is intended that:
(i) This Agreement shall be deemed to be a security agreement within the meaning of Articles 8 and 9 of the New York UCC and the UCC of any other applicable jurisdiction;
(ii) The conveyance provided for in Section 2.1 shall be deemed to be a grant by the Seller to the Buyer of a security interest in all of its right (including the power to convey title thereto), title and interest, whether now owned or hereafter acquired, in and to the Exchange Note, to secure the performance of the obligations of the Seller hereunder;
(iii) The possession by the Buyer or its agent of the Exchange Note shall be deemed to be “possession by the secured party” or possession by the purchaser or a person designated by such purchaser, for purposes of perfecting the security interest pursuant to the New York UCC and the UCC of any other applicable jurisdiction; and
(iv) Notifications to persons holding such property, and acknowledgments, receipts or confirmations from persons holding such property, shall be deemed to be notifications to, or acknowledgments, receipts or confirmations from, bailees or agents (as applicable) of the Buyer for the purpose of perfecting such security interest under applicable law.
Section 3.2 Specific Performance. Either party may enforce specific performance of this Agreement.
10
(a) Any term or provision of this Agreement may be amended by the parties hereto without the consent of the Indenture Trustee, any Noteholder, the Issuing Entity or the Owner Trustee; provided that (i) any amendment that materially and adversely affects the interests of the Noteholders shall require the consent of Noteholders evidencing not less than a majority of the aggregate outstanding principal amount of the Outstanding Notes, voting as a single class, and (ii) any amendment that materially and adversely affects the interests of the Certificateholders, the Indenture Trustee or the Owner Trustee shall require the prior written consent of the Persons whose interests are materially and adversely affected. An amendment shall be deemed not to materially and adversely affect the interests of the Noteholders if the Rating Agency Condition is satisfied with respect to such amendment. The consent of the Certificateholders, the Indenture Trustee or the Owner Trustee shall be deemed to have been given if the Servicer does not receive a written objection from such Person within 10 Business Days after a written request for such consent shall have been given.
(b) Notwithstanding the foregoing, no amendment shall (i) reduce the interest rate or principal amount of any Note, or delay the Final Scheduled Payment Date of any Note without the consent of the Holder of such Note, or (ii) reduce the percentage of the aggregate outstanding principal amount of the Outstanding Notes, the Holders of which are required to consent to any matter without the consent of the Holders of at least the percentage of the aggregate outstanding principal amount of the Outstanding Notes which were required to consent to such matter before giving effect to such amendment.
11
(c) Notwithstanding anything herein to the contrary, any term or provision of this Agreement may be amended by the parties hereto without the consent of any of the Noteholders or any other Person to add, modify or eliminate any provisions as may be necessary or advisable in order to comply with or obtain more favorable treatment under or with respect to any law or regulation or any accounting rule or principle (whether now or in the future in effect); it being a condition to any such amendment that the Rating Agency Condition shall have been satisfied.
(d) It shall not be necessary for the consent of any Person pursuant to this Section for such Person to approve the particular form of any proposed amendment, but it shall be sufficient if such Person consents to the substance thereof.
(e) Prior to the execution of any amendment to this Agreement, the Buyer shall provide each Rating Agency with written notice of the substance of such amendment. No later than 10 Business Days after the execution of any amendment to this Agreement, the Buyer shall furnish a copy of such amendment to each Rating Agency, the Issuing Entity, the Owner Trustee and the Indenture Trustee.
(f) Prior to the execution of any amendment to this Agreement, the Owner Trustee and the Indenture Trustee shall be entitled to receive and conclusively rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement and that all conditions precedent to the execution and delivery of such amendment have been satisfied.
12
13
(a) submits for itself and its property in any legal action or proceeding relating to this Agreement or any documents executed and delivered in connection herewith, or for recognition and enforcement of any judgment in respect thereof, to the nonexclusive general jurisdiction of the courts of the State of New York, the courts of the United States of America for the Southern District of New York and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;
14
(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such Person at its address determined in accordance with Section 3.3 of this Agreement;
(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and
(e) to the extent permitted by applicable law, waives all right of trial by jury in any action, proceeding or counterclaim based on, or arising out of, under or in connection with this Agreement, any other Transaction Document, or any matter arising hereunder or thereunder.
[Signature Page Follows]
15
AUTO LEASE FINANCE LLC | ||
By: | ||
Name: | ||
Title: | ||
Address: | ||
000 Xxx Xxxxx Xxxx. | ||
Deerfield Beach, Florida 33442 | ||
Telephone: (000) 000-0000 | ||
Telecopy: (000) 000-0000 | ||
WORLD OMNI AUTO LEASING LLC | ||
By: | ||
Name: | ||
Title: | ||
Address: | ||
000 Xxx Xxxxx Xxxx. | ||
Deerfield Beach, Florida 33442 | ||
Telephone: (000) 000-0000 | ||
Telecopy: (000) 000-0000 |
[Signature Page to Exchange Note Sale Agreement]
SCHEDULE I
PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS
In addition to the representations, warranties and covenants contained in the Exchange Note Sale Agreement, the Seller hereby represents, warrants, and covenants to the Buyer as follows on the Closing Date:
1. The Exchange Note Sale Agreement creates a valid and continuing security interest (as defined in the applicable UCC) in the Exchange Note in favor of the Buyer, which security interest is prior to all other Adverse Claims and is enforceable as such as against creditors of and purchasers from the Seller.
2. The Exchange Note constitutes a “general intangible,” “instrument,” “certificated security,” or “tangible chattel paper,” within the meaning of the applicable UCC.
3. The Seller owns and has good and marketable title to the Exchange Note free and clear of any Adverse Claim, claim or encumbrance of any Person, excepting only liens for taxes, assessments or similar governmental charges or levies incurred in the ordinary course of business that are not yet due and payable or as to which any applicable grace period shall not have expired, or that are being contested in good faith by proper proceedings and for which adequate reserves have been established, but only so long as foreclosure with respect to such a lien is not imminent and the use and value of the property to which the Adverse Claim attaches is not impaired during the pendency of such proceeding.
4. The Seller has received all consents and approvals to the sale of the Exchange Note hereunder to the Buyer required by the terms of the Exchange Note to the extent that it constitutes an instrument or a payment intangible.
5. The Seller has received all consents and approvals required by the terms of the Exchange Note, to the extent that it constitutes a securities entitlement, certificated security or uncertificated security, to the transfer to the Buyer of its interest and rights in the Exchange Note hereunder.
6. The Seller has caused or will have caused, within ten days after the effective date of the Exchange Note Sale Agreement, the filing of all appropriate financing statements in the proper filing office in the appropriate jurisdictions under applicable law in order to perfect the sale of the Exchange Note from the Seller to the Buyer and the security interest in the Exchange Note granted to the Buyer hereunder.
7. To the extent that the Exchange Note constitutes an instrument or tangible chattel paper, all original executed copies of each such instrument or tangible chattel paper have been delivered to the Buyer.
Sch. I-1
8. Other than the transfer of the Exchange Note from the Seller to the Buyer under the Exchange Note Sale Agreement and from the Buyer to the Issuing Entity under the Exchange Note Transfer Agreement and the security interest granted to the Indenture Trustee pursuant to the Indenture, the Seller has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed the Exchange Note. The Seller has not authorized the filing of, nor is aware of, any financing statements against the Seller that include a description of collateral covering the Exchange Note other than any financing statement relating to any security interest granted pursuant to the Transaction Documents or that has been terminated.
9. No instrument or tangible chattel paper that constitutes or evidences the Exchange Note has any marks or notations indicating that it has been pledged, assigned or otherwise conveyed to any Person other than the Indenture Trustee.
Sch. I-2