Exhibit 99.2
EXECUTION COPY
RECEIVABLES PURCHASE AGREEMENT
between
USAA FEDERAL SAVINGS BANK
as Seller
and
USAA ACCEPTANCE, LLC
as Depositor
Dated as of March 1, 2005
Table of Contents
Page
Article I
Interpretation
Section 1.01. Definitions and Usage........................................1
Article II
Conveyance of Receivables
Section 2.01. Conveyance of Receivables....................................2
Section 2.02. The Closing..................................................2
Article III
Representations and Warranties
Section 3.01. Representations and Warranties of the Depositor..............3
Section 3.02. Representations and Warranties of the Seller.................4
Article IV
Conditions
Section 4.01. Conditions to Obligation of the Depositor....................9
Section 4.02. Conditions to Obligation of the Seller......................10
Article V
Covenants of the Seller
Section 5.01. Protection of Right, Title and Interest.....................11
Section 5.02. Other Liens or Interests....................................12
Section 5.03. Costs and Expenses..........................................12
Section 5.04. Hold Harmless...............................................12
Article VI
Indemnification
Section 6.01. Indemnification.............................................12
Section 6.02. Contribution................................................14
Article VII
Miscellaneous Provisions
Section 7.01. Obligations of Seller.......................................15
Section 7.02. Repurchase Events...........................................15
Section 7.03. Depositor Assignment of Repurchased Receivables.............15
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Section 7.04. Transfer to the Issuer......................................15
Section 7.05. Amendment...................................................16
Section 7.06. Waivers.....................................................16
Section 7.07. Notices.....................................................16
Section 7.08. Costs and Expenses..........................................17
Section 7.09. Representations of the Seller and the Depositor.............17
Section 7.10. Confidential Information....................................17
Section 7.11. Headings and Cross-References...............................17
Section 7.12. GOVERNING LAW...............................................17
Section 7.13. Counterparts................................................17
Section 7.14. Third Party Beneficiary.....................................17
Section 7.15. No Proceedings..............................................17
Exhibit A Matters Addressed in Opinion of Seller's Counsel
Schedule A Schedule of Receivables
Schedule B Location of Receivable Files
Appendix A Definitions and Usage
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RECEIVABLES PURCHASE AGREEMENT dated as of March 1, 2005 (as from
time to time amended, supplemented or otherwise modified and in effect, this
"Agreement"), between USAA FEDERAL SAVINGS BANK, a federally chartered savings
association, as seller (in such capacity, together with its permitted
successors and permitted assigns in such capacity, the "Seller") and USAA
ACCEPTANCE, LLC, a Delaware limited liability company, as depositor (together
with its successors and permitted assigns, the "Depositor").
RECITALS
WHEREAS, the Depositor desires to purchase a portfolio of receivables
and related property consisting of motor vehicle installment loan contracts
originated by the Seller in the ordinary course of its business;
WHEREAS, the Seller and the Depositor wish to set forth the terms
pursuant to which such portfolio of receivables and related property are to be
sold by the Seller to the Depositor; and
WHEREAS, the Depositor intends, concurrently with its purchase
hereunder, to convey all of its right, title and interest in and to all of
such portfolio of receivables and related property to USAA Auto Owner Trust
2005-1, a Delaware statutory trust (the "Issuer") pursuant to a Sale and
Servicing Agreement dated as of March 1, 2005 (the "Sale and Servicing
Agreement"), by and among the Issuer, the Depositor, USAA Federal Savings
Bank, as Seller and Servicer, and the Issuer intends to pledge all of its
right, title and interest in and to such portfolio of receivables and related
property to JPMorgan Chase Bank, National Association, as Indenture Trustee
(the "Indenture Trustee") pursuant to the Indenture dated as of March 15, 2005
(the "Indenture"), by and between the Issuer and the Indenture Trustee.
NOW, THEREFORE, in consideration of the foregoing, other good and
valuable consideration and the mutual terms and covenants contained herein,
the parties hereto agree as follows:
Article I
Interpretation
Section 1.01. Definitions and Usage. Except as otherwise specified
herein or as the context may otherwise require, capitalized terms used but not
otherwise defined herein are defined in Appendix A hereto, which also contains
rules as to usage that shall be applicable herein.
Article II
Conveyance of Receivables
Section 2.01. Conveyance of Receivables.
(a) In consideration of the Depositor's delivery to or upon
the order of the Seller on the Closing Date of $1,050,985,136.76 (the
"Purchase Price"), the Seller does hereby irrevocably sell, transfer, assign,
set over and otherwise convey to the Depositor, without recourse (subject to
the obligations of the Seller set forth herein) all right, title, and interest
of the Seller, whether now or hereinafter acquired, in and to the Trust
Property.
(b) The transfer, assignment and conveyance made hereunder
shall not constitute and is not intended to result in an assumption by the
Depositor of any obligation of the Seller to the Obligors or any other Person
in connection with the Receivables and the other Trust Property or any
agreement, document or instrument related thereto.
(c) The Seller and the Depositor intend that the transfer of
assets by the Seller to the Depositor pursuant to this Agreement be a sale of
the ownership interest in such assets to the Depositor, rather than the mere
granting of a security interest to secure a borrowing. In the event, however,
that such transfer is deemed not to be a sale but to be of a mere security
interest to secure a borrowing, the Seller shall be deemed to have hereby
granted to the Depositor a security interest in all accounts, money, chattel
paper, securities, instruments, documents, deposit accounts, certificates of
deposit, letters of credit, advices of credit, banker's acceptances,
uncertificated securities, general intangibles, contract rights, goods and
other property consisting of, arising from or relating to such Trust Property,
which security interest shall be perfected and of first priority, and this
Agreement shall constitute a security agreement under applicable law. Pursuant
to the Sale and Servicing Agreement and Section 7.04 hereof, the Depositor may
sell, transfer and assign to the Issuer (i) all or any portion of the assets
assigned to the Depositor hereunder, (ii) all or any portion of the
Depositor's rights against the Seller under this Agreement and (iii) all
proceeds thereof. Such assignment may be made by the Depositor with or without
an assignment by the Depositor of its rights under this Agreement, and without
further notice to or acknowledgement from the Seller. The Seller waives, to
the extent permitted under applicable law, all claims, causes of action and
remedies, whether legal or equitable (including any right of setoff), against
the Depositor or any assignee of the Depositor relating to such action by the
Depositor in connection with the transactions contemplated by the Sale and
Servicing Agreement.
Section 2.02. The Closing. The sale and purchase of the Trust
Property shall take place at a closing at the office of Sidley Xxxxxx Xxxxx &
Xxxx llp, New York, New York on the Closing Date, simultaneously with the
closing under (a) the Sale and Servicing Agreement, (b) the Indenture and (c)
the Trust Agreement.
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Article III
Representations and Warranties
Section 3.01. Representations and Warranties of the Depositor. The
Depositor hereby represents and warrants as follows to the Seller and the
Indenture Trustee as of the date hereof and the Transfer Date:
(a) Organization and Good Standing. The Depositor is a
limited liability company duly organized, validly existing and in good
standing under the laws of the State of Delaware, with all requisite power and
authority to own its properties and to conduct its business as such properties
are currently owned and such business is currently conducted.
(b) Due Qualification. The Depositor is duly qualified to do
business as a foreign limited liability company in good standing, and has
obtained all necessary licenses and approvals in all jurisdictions where the
failure to do so would materially and adversely affect the Depositor's ability
to acquire the Receivables or the other Trust Property or the validity or
enforceability of the Receivables or the other Trust Property.
(c) Power and Authority. The Depositor has all the limited
liability company power and authority to execute, deliver and perform this
Agreement and the other Basic Documents to which it is a party and to carry
out their respective terms; the Depositor has full power and authority to sell
and assign the property to be sold and assigned to and deposited with the
Issuer, and the Depositor shall have duly authorized such sale and assignment
to the Issuer by all necessary limited liability company action; and the
execution, delivery and performance of this Agreement and the other Basic
Documents to which the Depositor is a party have been duly authorized by the
Depositor by all necessary limited liability company action.
(d) Binding Obligation. This Agreement and the other Basic
Documents to which the Depositor is a party, when duly executed and delivered
by the other parties hereto and thereto, shall constitute legal, valid and
binding obligations of the Depositor, enforceable against the Depositor in
accordance with their respective terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization or similar laws now
or hereafter in effect relating to or affecting creditors' rights generally
and to general principles of equity (whether applied in a proceeding at law or
in equity).
(e) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof do not
conflict with, result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time or both) a default under,
the limited liability company agreement of the Depositor, or any indenture,
agreement or other instrument to which the Depositor is a party or by which it
is bound, or violate any law, rules or regulation applicable to the Depositor
of any court or federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the Depositor.
(f) No Proceedings. There are no proceedings or
investigations pending or, to the Depositor's knowledge, threatened against
the Depositor before any court, regulatory body,
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administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties (i) asserting the invalidity
of this Agreement or any other Basic Document to which the Depositor is a
party, (ii) seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or any other Basic Document to which the
Depositor is a party or (iii) seeking any determination or ruling that might
materially and adversely affect the performance by the Depositor of its
obligations under, or the validity or enforceability of, this Agreement or any
other Basic Document to which the Depositor is a party.
(g) No Consents. The Depositor is not required to obtain the
consent of any other party or any consent, license, approval, registration,
authorization, or declaration of or with any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity, or
enforceability of this Agreement or any other Basic Document to which it is a
party that has not already been obtained.
Section 3.02. Representations and Warranties of the Seller.
(a) The Seller hereby represents and warrants as follows to
the Depositor and the Indenture Trustee as of the date hereof and as of the
Transfer Date:
(i) Organization and Good Standing. The Seller is a
federally chartered savings association duly organized and validly
existing as a banking institution under the laws of the United States
and continues to hold a valid certificate to do business as such, and
has the power to own its assets and to transact the business in which
it is currently engaged. The Seller is duly authorized to transact
business and has obtained all necessary licenses and approvals, and
is in good standing in each jurisdiction in which the character of
the business transacted by it or any properties owned or leased by it
requires such authorization.
(ii) Power and Authority. The Seller has the power
and authority to make, execute, deliver and perform this Agreement
and all of the transactions contemplated under this Agreement and the
other Basic Documents to which the Seller is a party, and has taken
all necessary action to authorize the execution, delivery and
performance of this Agreement and the other Basic Documents to which
the Seller is a party. When executed and delivered, this Agreement
and the other Basic Documents to which the Seller is a party will
constitute legal, valid and binding obligations of the Seller
enforceable in accordance with their respective terms, except as
enforcement of such terms may be limited by bankruptcy, insolvency or
similar laws affecting the enforcement of creditors' rights generally
and by the availability of equitable remedies and except as
enforcement of such terms may be limited by receivership,
conservatorship and supervisory powers of bank regulatory agencies
generally.
(iii) No Violation. The execution, delivery and
performance by the Seller of this Agreement and the other Basic
Documents to which the Seller is a party will not violate any
provision of any existing state, federal or, to the best knowledge of
the Seller, local law or regulation or any order or decree of any
court applicable to the Seller or any provision of the articles of
association or incorporation or the bylaws of the Seller, or
constitute a breach of any mortgage, indenture, contract or other
agreement to
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which the Seller is a party or by which the Seller may be bound or
result in the creation or imposition of any lien upon any of the
Seller's properties pursuant to any such mortgage, indenture,
contract or other agreement (other than this Agreement).
(iv) No Proceedings. There are no proceedings or
investigations pending or, to the Seller's knowledge, threatened
against the Seller before any court, regulatory body, administrative
agency or other governmental instrumentality having jurisdiction over
the Seller or its properties (i) asserting the invalidity of this
Agreement or any other Basic Document to which the Seller is a party,
(ii) seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or any other Basic Document to which
the Seller is a party or (iii) seeking any determination or ruling
that might materially and adversely affect the performance by the
Seller of its obligations under, or the validity or enforceability
of, this Agreement or any other Basic Document to which the Seller is
a party.
(v) Chief Executive Office. The chief executive
office of the Seller is located at 00000 XxXxxxxxx Xxxxxxx, Xxx
Xxxxxxx, Xxxxx 00000.
(vi) No Consents. The Seller is not required to
obtain the consent of any other party or any consent, license,
approval, registration, authorization, or declaration of or with any
governmental authority, bureau or agency in connection with the
execution, delivery, performance, validity, or enforceability of this
Agreement or any other Basic Document to which it is a party that has
not already been obtained.
(vii) No Notice. The Seller represents and warrants
that it acquired title to the Receivables and the other Trust
Property in good faith, without notice of any adverse claim.
(viii) Bulk Transfer. The Seller represents and
warrants that the transfer, assignment and conveyance of the
Receivables and the other Trust Property by the Seller pursuant to
this Agreement are not subject to the bulk transfer laws or any
similar statutory provisions in effect in any applicable
jurisdiction.
(ix) Seller Information. No certificate of an
officer, statement or document furnished in writing or report
delivered pursuant to the terms hereof by the Seller contains any
untrue statement of a material fact or omits to state any material
fact necessary to make the certificate, statement, document or report
not misleading.
(x) Ordinary Course. The transactions contemplated
by this Agreement and the other Basic Documents to which the Seller
is a party are in the ordinary course of the Seller's business.
(xi) Solvency. The Seller is not insolvent, nor
will the Seller be made insolvent by the transfer of the Trust
Property, nor does the Seller anticipate any pending insolvency.
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(xii) Legal Compliance. The Seller is not in
violation of, and the execution and delivery by the Seller of this
Agreement and the other Basic Documents to which the Seller is a
party and its performance and compliance with the terms of this
Agreement and the other Basic Documents to which the Seller is a
party will not constitute a violation with respect to, any order or
decree of any court or any order or regulation of any federal, state,
municipal or governmental agency having jurisdiction, which violation
would materially and adversely affect the Seller's condition
(financial or otherwise) or operations or any of the Seller's
properties or materially and adversely affect the performance of any
of its duties under the Basic Documents.
(xiii) Creditors. The Seller did not sell the
Receivables or the other Trust Property to the Depositor with any
intent to hinder, delay or defraud any of its creditors.
(b) The Seller makes the following representations and
warranties with respect to the Receivables, on which the Depositor relies in
accepting the Receivables and in transferring the Receivables to the Issuer
under the Sale and Servicing Agreement, and on which the Issuer relies in
pledging the same to the Indenture Trustee. Such representations and
warranties speak as of the execution and delivery of this Agreement and as of
the Transfer Date, but shall survive the sale, transfer and assignment of the
Receivables to the Depositor, the subsequent sale, transfer and assignment of
the Receivables by the Depositor to the Issuer pursuant to the Sale and
Servicing Agreement and the pledge of the Receivables by the Issuer to the
Indenture Trustee pursuant to the Indenture.
(i) Schedule of Receivables. The information set
forth in Schedule A to this Agreement with respect to each Receivable
is true and correct in all material respects, and no selection
procedures adverse to the Securityholders have been used in selecting
the Receivables from all receivables owned by the Seller which meet
the selection criteria specified herein.
(ii) No Sale or Transfer. No Receivable has been
sold, transferred, assigned or pledged by the Seller to any Person
other than the Depositor.
(iii) Good Title. Immediately prior to the transfer
and assignment of the Receivables to the Depositor herein
contemplated, the Seller had good and marketable title to each
Receivable free and clear of all Liens and rights of others; and,
immediately upon the transfer thereof, the Depositor, has either (i)
good and marketable title to each Receivable, free and clear of all
of all Liens and rights of others, and the transfer has been
perfected under applicable law or (ii) a first priority perfected
security interest in each Receivable.
(iv) Receivable Files. The Receivable Files shall
be kept at one or more of the locations specified in Schedule B
hereto.
(v) Characteristics of Receivables. Each Receivable
(a) has been originated for the retail financing of a Financed
Vehicle by an Obligor located in one of the States of the United
States or the District of Columbia; (b) contains customary and
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enforceable provisions such that the rights and remedies of the
holder thereof are adequate for realization against the collateral of
the benefits of the security; and (c) provides for fully amortizing
level scheduled monthly payments (provided that the payment in the
last month in the life of the Receivable may be different from the
level scheduled payment) and for accrual of interest at a fixed rate
according to the simple interest method.
(vi) Compliance with Law. Each Receivable and each
sale of the related Financed Vehicle complied at the time it was
originated or made, and complies on and after the Cut-off Date, in
all material respects with all requirements of applicable federal,
state, and local laws, and regulations thereunder, including usury
laws, the Federal Truth-in-Lending Act, the Equal Credit Opportunity
Act, the Fair Credit Reporting Act, the Federal Trade Commission Act,
the Xxxxxxxx-Xxxx Warranty Act, Federal Reserve Board Regulations B
and Z, state adaptations of the National Consumer Act and of the
Uniform Consumer Credit Code, and any other consumer credit, equal
opportunity, and disclosure laws applicable to such Receivable and
sale.
(vii) Binding Obligation. Each Receivable
constitutes the legal, valid, and binding payment obligation in
writing of the Obligor, enforceable by the holder thereof in all
material respects in accordance with its terms, subject, as to
enforcement, to applicable bankruptcy, insolvency, reorganization,
liquidation and other similar laws and equitable principles relating
to or affecting the enforcement of creditors' rights.
(viii) No Government Obligor. No Receivable is due
from the United States of America or any state or from any agency,
department, instrumentality or political subdivision of the United
States of America or any state or local municipality and no
Receivable is due from a business except to the extent that such
receivable has a personal guaranty.
(ix) Security Interest in Financed Vehicle.
Immediately prior to the sale and assignment thereof to the Depositor
as herein contemplated, each Receivable was secured by a validly
perfected first priority security interest in the Financed Vehicle in
favor of the Seller as secured party or all necessary and appropriate
action with respect to such Receivable had been taken to perfect a
first priority security interest in the related Financed Vehicle in
favor of the Seller as secured party, which security interest is
assignable and has been so assigned by the Seller to the Depositor.
(x) Receivables in Force. No Receivable has been
satisfied, subordinated, or rescinded, nor has any Financed Vehicle
been released from the Lien granted by the related Receivable in
whole or in part.
(xi) No Waiver. No provision of a Receivable has
been waived in such a manner that such Receivable fails either to
meet all of the representations and warranties made by the Seller
herein with respect thereto pursuant to this Section 3.02.
(xii) No Amendments. No Receivable has been amended
except pursuant to instruments included in the Receivable Files and
no such amendment has
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caused such Receivable either to fail to meet all of the
representations and warranties made by the Seller herein with respect
thereto pursuant to this Section 3.02.
(xiii) No Defenses. As of the Cut-off Date, there
are no rights of rescission, setoff, counterclaim, or defense, and
the Seller has no knowledge of the same being asserted or threatened,
with respect to any Receivable.
(xiv) No Liens. As of the Cut-off Date, the Seller
has no knowledge of any Liens or claims that have been filed,
including Liens for work, labor, materials or unpaid taxes relating
to a Financed Vehicle, that would be Liens prior to, or equal or
coordinate with, the Lien granted by the Receivable.
(xv) No Default. Except for payment defaults
continuing for a period of not more than thirty (30) days as of the
Cut-off Date, the Seller has no knowledge that a default, breach,
violation, or event permitting acceleration under the terms of any
Receivable exists; the Seller has no knowledge that a continuing
condition that with notice or lapse of time would constitute a
default, breach, violation, or event permitting acceleration under
the terms of any Receivable exists; and the Seller has not waived any
of the foregoing.
(xvi) Insurance. Each Receivable requires that the
Obligor thereunder obtain comprehensive and collision insurance
covering the Financed Vehicle.
(xvii) Lawful Assignment. No Receivable has been
originated in, or is subject to the laws of, any jurisdiction under
which the sale, transfer, and assignment of such Receivable under
this Agreement is unlawful, void or voidable.
(xviii) All Filings Made. No filings (other than
UCC filings which have been made or will be made at the Closing Date)
or other actions are necessary in any jurisdiction to give the Issuer
a first priority perfected security interest in the Receivables and
to give the Indenture Trustee a first priority perfected security
interest in the Receivables.
(xix) One Original. With respect to any Receivable
for which an original executed copy exists, there is no more than one
original executed copy of such Receivable which, immediately prior to
the delivery thereof to the Servicer, as custodian for the Indenture
Trustee, was in the possession of the Seller.
(xx) Security. Each Receivable is secured by a new
or used automobile or light-duty truck.
(xxi) Maturity of Receivables. Each Receivable has
a remaining maturity, as of the Cut-off Date, of not less than 6
months and not more than 72 months and an original maturity of at not
less than 9 months and not more than 72 months. No Receivable has a
scheduled maturity later than April 1, 2011.
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(xxii) Annual Percentage Rate. Each Receivable is a
fully-amortizing fixed rate simple interest contract that provides
for level scheduled monthly payments (except for the last payment,
which may be minimally different from the level payments) over its
respective remaining term, and is not secured by any interest in real
estate, and has not been identified on the computer files of the
Seller as relating to Obligors who have requested a reduction in the
periodic finance charges, as of the Cut-off Date, by application of
the Servicemembers Civil Relief Act.
(xxiii) No Repossessions. Each Receivable is
secured by a Financed Vehicle that, as of the Cut-off Date, has not
been repossessed without reinstatement of such Receivable.
(xxiv) Obligor Not Subject to Bankruptcy
Proceedings. Each Receivable has been entered into by an Obligor who
has not been identified on the computer files of the Seller as being
a debtor in any bankruptcy proceeding as of the Cut-off Date.
(xxv) No Overdue Payments. No Receivable has any
payment that is more than 30 days past due as of the Cut-off Date.
(xxvi) Tangible Chattel Paper. The Receivables
constitute "tangible chattel paper" within the meaning of UCC Section
9-102.
(xxvii) Remaining Principal Balance. Each
Receivable had a remaining principal balance, as of the Cut-off Date,
of at least $800.00.
Article IV
Conditions
Section 4.01. Conditions to Obligation of the Depositor. The
obligation of the Depositor to purchase the Receivables is subject to the
satisfaction of the following conditions:
(a) Representations and Warranties True. The representations
and warranties of the Seller hereunder shall be true and correct in all
material respects on the Transfer Date with the same effect as if then made,
and the Seller shall have performed all obligations to be performed by it
hereunder on or prior to the Transfer Date.
(b) Computer Files Marked. The Seller shall, at its own
expense, on or prior to the Transfer Date, indicate in its computer files that
the Receivables have been sold to the Depositor pursuant to this Agreement and
deliver to the Depositor the Schedule of Receivables, certified by the
Seller's President, Vice President or Treasurer to be true, correct and
complete.
(c) Documents to be Delivered by the Seller on the Transfer
Date:
(i) Evidence of UCC Filing. On or prior to
the Closing Date, the Seller shall record and file, at its
own expense, a UCC-1 financing statement in the State of
Texas, naming the Seller as seller, and naming the Depositor
as
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secured party, describing the Receivables and the other
assets assigned to the Depositor pursuant to Section 2.01,
meeting the requirements of the laws of each such
jurisdiction and in such manner as is necessary to perfect
the sale, transfer, assignment and conveyance of the
Receivables and such other assets to the Depositor. The
Seller shall deliver to the Depositor a file-stamped copy
or other evidence satisfactory to the Depositor of such
filing on or prior to the Transfer Date.
(ii) Opinions of Seller's Counsel. On or
prior to the Closing Date, the Depositor shall have received
the opinions of counsel to the Seller, in form and substance
satisfactory to the Depositor, as to the matters set forth
in Exhibit A hereto and such other matters as the Depositor
has heretofore requested or may reasonably request.
(iii) Other Documents. Such other
documents as the Depositor may reasonably request.
(d) Other Transactions. The transactions contemplated by the
Sale and Servicing Agreement, the Indenture and the Trust Agreement to be
consummated on the Transfer Date shall be consummated on such date.
Section 4.02. Conditions to Obligation of the Seller. The obligation
of the Seller to sell the Receivables to the Depositor is subject to the
satisfaction of the following conditions:
(a) Representations and Warranties True. The representations
and warranties of the Depositor hereunder shall be true and correct on the
Transfer Date with the same effect as if then made, and the Depositor shall
have performed all obligations to be performed by it hereunder on or prior to
the Transfer Date.
(b) Receivables Purchase Price. On the Transfer Date, the
Depositor shall have delivered to the Seller the purchase price specified in
Section 2.01 hereof.
(c) Opinion of Counsel. The Depositor shall have furnished
to the Seller an Opinion of Counsel, dated the Closing Date, to the effect
that:
(i) the Depositor has been duly formed and is
validly existing in good standing as a limited liability company
under the laws of the State of Delaware and has all necessary limited
liability company power and authority to execute, deliver and perform
its obligations under the Underwriting Agreement, the Trust
Agreement, the Sale and Servicing Agreement and this Agreement (the
"Transaction Documents");
(ii) each of the Transaction Documents have been
duly authorized, executed and delivered by the Depositor;
(iii) Neither the execution, delivery and
performance by the Depositor of the Transaction Documents, nor the
consummation by the Depositor of any of the transactions contemplated
thereby, requires the consent or approval of, the withholding of
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objection on the part of, the giving of notice to, the filing,
registration or qualification with, or the taking of any other action
in respect of, any governmental authority or agency of the State of
Delaware, other than the filing of UCC-1 financing statements
relating to the grant of the security interest in the Receivables and
the other Trust Property by USAA Federal Savings Bank as the sole
equity member of the Depositor, to the Depositor and by the Depositor
to the Trust with the Secretary of State, and the filing of the LLC
Certificate and the Certificate of Trust of the Trust with the
Secretary of State; and
(iv) Neither the execution, delivery and
performance by the Depositor of the Transaction Documents, nor the
consummation by the Depositor of the transactions contemplated
thereby, violates the amended and restated limited liability company
agreement of the Depositor, dated as of July 8, 2004 and amended by
an amendment dated as of November 12, 2004, or any law, rule or
regulation of the State of Delaware applicable to the Depositor.
(d) Other Transactions. The transactions contemplated by the
Sale and Servicing Agreement, the Indenture and the Trust Agreement to be
consummated on the Transfer Date shall be consummated on such date.
Article V
Covenants of the Seller
The Seller agrees with the Depositor and the Indenture Trustee as
follows:
Section 5.01. Protection of Right, Title and Interest.
(a) Filings. The Seller shall cause at its own expense all
financing statements and continuation statements and any other necessary
documents covering the right, title and interest of the Seller, the Depositor,
the Trust and the Indenture Trustee, respectively, in and to the Receivables
and the other property included in the Trust Estate to be promptly filed and
at all times to be kept recorded, registered and filed, all in such manner and
in such places as may be required by law fully to preserve and protect the
right, title and interest of the Depositor hereunder, the Trust under the Sale
and Servicing Agreement and the Indenture Trustee under the Indenture in and
to the Receivables and the other property included in the Trust Property. The
Seller shall deliver to the Depositor and the Indenture Trustee file stamped
copies of, or filing receipts for, any document recorded, registered or filed
as provided above, as soon as available following such recordation,
registration or filing. The Depositor shall cooperate fully with the Seller in
connection with the obligations set forth above and will execute any and all
documents reasonably required to fulfill the intent of this paragraph.
(b) Name Change. If the Seller makes any change in its name,
identity or corporate structure that would make any financing statement or
continuation statement filed in accordance with paragraph (a) above seriously
misleading within the applicable provisions of the UCC or any title statute or
if the Seller changes the jurisdiction under whose laws it is formed,
11
the Seller shall give the Depositor, the Indenture Trustee and the Owner
Trustee written notice thereof at least 45 days prior to such change and shall
promptly file such financing statements or amendments as may be necessary to
continue the perfection of the Depositor's interest in the property conveyed
pursuant to Section 2.01.
Section 5.02. Other Liens or Interests. Except for the conveyances
hereunder and pursuant to the Basic Documents, the Seller shall not sell,
pledge, assign or transfer to any Person, or grant, create, incur, assume, or
suffer to exist any Lien on, or any interest in, to or under the Receivables,
and the Seller shall defend the right, title and interest of the Depositor,
the Trust and the Indenture Trustee in, to and under the Receivables against
all claims of third parties claiming through or under the Seller.
Section 5.03. Costs and Expenses. The Seller agrees to pay all
reasonable costs and disbursements in connection with the perfection, as
against all third parties claiming through or under the Seller, of the
Depositor's, the Issuer's and the Indenture Trustee's right, title and
interest in and to the Receivables and the other property included in the
Trust Property.
Section 5.04. Hold Harmless. The Seller shall protect, defend,
indemnify and hold the Depositor, the Issuer and their respective assigns and
their employees, officers, directors and agents harmless from and against all
losses, liabilities, claims and damages of every kind and character, including
any legal or other expenses reasonably incurred, as incurred, resulting from
or relating to or arising out of (i) the inaccuracy, nonfulfillment or breach
of any representation, warranty, covenant or agreement made by the Seller in
this Agreement, (ii) any legal action, including, without limitation, any
counterclaim, that has either been settled by the litigants or has proceeded
to judgment by a court of competent jurisdiction, in either case to the extent
it is based upon alleged facts that, if true, would constitute a breach of any
representation, warranty, covenant or agreement made by the Seller in this
Agreement, (iii) any actions or omissions of the Seller occurring prior to the
Transfer Date with respect to any of the Receivables or Financed Vehicles or
(iv) any failure of a Receivable to be originated in compliance with all
applicable requirements of law. These indemnity obligations shall be in
addition to any obligation that the Seller may otherwise have.
Article VI
Indemnification
Section 6.01. Indemnification.
(a) The Seller agrees to indemnify and hold harmless the
Depositor, each of its respective directors, each officer of the Depositor who
signed the Registration Statement, and each person or entity who controls the
Depositor or any such person, within the meaning of Section 15 of the
Securities Act, against any and all losses, claims, damages or liabilities,
joint and several, to which the Depositor, or any such person or entity may
become subject, under the Securities Act or otherwise, and will reimburse the
Depositor, and each such controlling person for any legal or other expenses
reasonably incurred by the Depositor or such controlling person in connection
with investigating or defending any such loss, claims, damages or liabilities
insofar
12
as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact made by the Seller contained in the Prospectus
Supplement or any amendment or supplement to the Prospectus Supplement or the
omission or the alleged omission to state therein a material fact necessary in
order to make the statements in the Prospectus Supplement or any amendment or
supplement to the Prospectus Supplement, in the light of the circumstance
under which they were made, not misleading, but, in each case, only to the
extent that such untrue statement or alleged untrue statement or omission or
alleged omission relates to the information contained in the Prospectus
Supplement under the captions: "Summary of Terms of the
Securities--Composition of the Receivables"; "Risk Factors"; and "The
Receivables Pool"; and in the Base Prospectus under the caption "The Bank's
Portfolio of Motor Vehicle Loans" (such information, the "Seller
Information"). This indemnity agreement will be in addition to any liability
which the Seller may otherwise have to the Depositor or any Affiliate thereof
pursuant to Section 5.04 of this Agreement or otherwise.
(b) The Depositor agrees to indemnify and hold harmless the
Seller and each Person who controls the Seller within the meaning of Section
15 of the Securities Act against any and all losses, claims, damages or
liabilities, joint and several, to which the Seller, or any such person or
entity may become subject, under the Securities Act or otherwise, and will
reimburse the Seller and each such controlling Person for any legal or other
expenses reasonably incurred by the Seller or such controlling Person in
connection with investigating or defending any such losses, claims, damages or
liabilities insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of material fact contained in the Registration
Statement or any amendment or supplement thereto or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading or (ii) any untrue
statement or alleged untrue statement of any material fact contained in the
Prospectus Supplement or the Prospectus or any amendment or supplement to the
Prospectus Supplement or the Prospectus or the omission or the alleged
omission to state therein a material fact necessary in order to make the
statements in the Prospectus Supplement or the Prospectus or any amendment or
supplement to the Prospectus Supplement, in the light of the circumstances
under which they were made, not misleading, but only to the extent that such
untrue statement or alleged untrue statement or omission or alleged omission
relates to the information contained in the Prospectus Supplement or the
Prospectus other than the Seller Information. This indemnity agreement will be
in addition to any liability which the Depositor may otherwise have.
(c) Promptly after receipt by any indemnified party under
this Article VI of notice of any claim or the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
any indemnifying party under this Article VI, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Article VI except to the extent it has
been materially prejudiced by such failure; provided, further, that the
failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Article VI.
13
If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party,
to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Article VI for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.
Any indemnified party shall have the right to employ
separate counsel in any such action and to participate in the defense thereof,
but the fees and expenses of such counsel shall be at the expense of such
indemnified party unless: (i) the employment thereof has been specifically
authorized by the indemnifying party in writing; (ii) such indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party and in the reasonable judgment of such
counsel it is appropriate for such indemnified party to employ separate
counsel; or (iii) the indemnifying party has failed to assume the defense of
such action and employ counsel reasonably satisfactory to the indemnified
party, in which case, if such indemnified party notifies the indemnifying
party in writing that it elects to employ separate counsel at the expense of
the indemnifying party, the indemnifying party shall not have the right to
assume the defense of such action on behalf of such indemnified party, it
being understood, however, the indemnifying party shall not, in connection
with any one such action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys (in addition to local counsel) at any time for
all such indemnified parties, which firm shall be designated in writing by the
Depositor, if the indemnified parties under this Article VI consist of the
Depositor, or by the Seller, if the indemnified parties under this Article VI
consist of the Seller.
Each indemnified party, as a condition of the indemnity
agreements contained in Section 6.01(a) and (b), shall use its commercially
reasonable efforts to cooperate with the indemnifying party in the defense of
any such action or claim. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise
or consent includes an unconditional release of each indemnified party from
all liability arising out of such claim, action, suit or proceeding.
Section 6.02. Contribution. In order to provide for just and
equitable contribution in circumstances in which the indemnity agreement
provided for in this Article VI is for any reason held to be unenforceable
although applicable in accordance with its terms, the Seller, on the one hand,
and the Depositor, on the other, shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by said
indemnity agreement incurred by the Seller and the Depositor in such
proportions as shall be appropriate to reflect the relative benefits
14
received by the Seller on the one hand and the Depositor on the other from the
sale of the Receivables such that the Depositor is responsible for that
portion represented by the underwriting discount set forth on the cover page
of the Prospectus Supplement, and the Seller shall be responsible for the
balance; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 6.02, each Person,
if any, who controls the Depositor within the meaning of Section 15 of the
Securities Act shall have the same rights to contribution as the Depositor and
each Person, if any, who controls the Seller within the meaning of Section 15
of the Securities Act shall have the same rights to contribution as the
Seller. Notwithstanding anything in this Section 6.02 to the contrary, the
Depositor shall not be required to contribute an amount in excess of the
amount of the underwriting discount appearing on the cover page of the
Prospectus Supplement.
Article VII
Miscellaneous Provisions
Section 7.01. Obligations of Seller. The obligations of the Seller
under this Agreement shall not be affected by reason of any invalidity,
illegality or irregularity of any Receivable.
Section 7.02. Repurchase Events. The Seller hereby covenants and
agrees with the Depositor for the benefit of the Depositor, the Indenture
Trustee, the Issuer, the Owner Trustee, the Certificateholders and the
Noteholders that the occurrence of a breach of any of the Seller's
representations and warranties contained in Section 3.02(b) that materially
and adversely affects the interests of the Issuer, the Indenture Trustee, the
Owner Trustee, the Certificateholders or the Noteholders in any Receivable,
without regard to any limitation set forth in such representation or warranty
concerning the knowledge of the Seller as to the facts stated therein, shall
constitute an event obligating the Seller to repurchase the Receivables to
which such failure or breach is applicable (each, a "Repurchase Event"), at
the Purchase Amount, from the Depositor, unless any such failure or breach
shall have been cured by the last day of the first Collection Period
commencing after the discovery or notice thereof by or to the Seller or the
Servicer.
Section 7.03. Depositor Assignment of Repurchased Receivables. With
respect to all Receivables repurchased by the Seller pursuant to this
Agreement, the Depositor shall assign, without recourse, representation or
warranty, to the Seller all of the Depositor's right, title and interest in
and to such Receivables and all security and documents relating thereto.
Section 7.04. Transfer to the Issuer. The Seller acknowledges and
agrees that (1) the Depositor will, pursuant to the Sale and Servicing
Agreement, transfer and assign the Receivables and assign its rights under
this Agreement with respect thereto to the Issuer and, pursuant to the
Indenture, the Issuer will pledge the Receivables to the Indenture Trustee,
and (2) the representations and warranties contained in this Agreement and the
rights of the Depositor under this Agreement, including under Section 7.02,
are intended to benefit the Issuer, the Indenture Trustee, the Noteholders and
the Certificateholder. The Seller hereby consents to such transfers and
assignments and agrees that enforcement of a right or remedy hereunder by
15
the Indenture Trustee, the Owner Trustee or the Issuer shall have the same
force and effect as if the right or remedy had been enforced or executed by
the Depositor.
Section 7.05. Amendment. This Agreement may be amended from time to
time, with prior written notice to the Rating Agencies, but without the
consent of the Noteholders or the Certificateholders, by a written amendment
duly executed and delivered by the Seller and the Depositor, for the purpose
of adding any provisions to or changing in any manner or eliminating any of
the provisions of this Agreement or of modifying in any manner the rights of
Noteholders or Certificateholders; provided that (i) such amendment shall not,
as evidenced by an Opinion of Counsel or an Officer's Certificate, materially
and adversely affect the interest of any Noteholder or Certificateholder and
(ii) the person requesting the amendment obtains a letter from the Rating
Agencies stating that the amendment would not result in the downgrading or
withdrawal of the ratings then assigned to the Notes and the Certificates.
This Agreement may also be amended by the Seller and the Depositor, with the
prior written notice to the Rating Agencies and the prior written consent of
(a) the Holders of Notes evidencing at least a majority of (i) the Outstanding
principal amount of the Class A-1 Notes, (ii) the Outstanding principal amount
of the Class A-2 Notes, (iii) the Outstanding principal amount of the Class
A-3 Notes, (iv) the Outstanding principal amount of the Class A-4 Notes and
(b) the Certificateholders of Certificates evidencing at least a majority of
the Certificate Balance (excluding, for purposes of this Section 7.05,
Certificates held by the Seller, the Depositor or any of their respective
Affiliates) for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying
in any manner the rights of the Noteholders or the Certificateholders;
provided, however, that no such amendment may (i) increase or reduce in any
manner the amount of, or accelerate or delay the timing of, collections of
payments on Receivables or distributions that shall be required to be made for
the benefit of any Noteholders or Certificateholders or (ii) reduce the
aforesaid majority requirement that is required to consent to any such
amendment, without the consent of the Holders of all the outstanding Notes and
Certificates.
Section 7.06. Waivers. No failure or delay on the part of the
Depositor, the Issuer or the Indenture Trustee in exercising any power, right
or remedy under this Agreement shall operate as a waiver thereof, nor shall
any single or partial exercise of any such power, right or remedy preclude any
other or further exercise thereof or the exercise of any other power, right or
remedy.
Section 7.07. Notices. All demands, notices and communications under
this Agreement shall be in writing, personally delivered, faxed and followed
by first class mail, or mailed by certified mail, return receipt requested,
and shall be deemed to have been duly given upon receipt (a) in the case of
the Depositor, to 0000 Xxxxxxxxx Xxxx., Xxxxx 000, Xxx Xxxxxxx, Xxxxx 00000,
Attention: Vice President, Legal Counsel; (b) in the case of the Servicer,
Administrator and Custodian, to 00000 XxXxxxxxx Xxxxxxx, Xxx Xxxxxxx, Xxxxx
00000, Attention: Xxxx Broker, Vice President, (c) in the case of the Seller,
00000 XxXxxxxxx Xxxxxxx, Xxx Xxxxxxx, Xxxxx 00000, Attention: Xxxx Broker,
Vice President; (d) in the case of the Issuer or the Owner Trustee, at the
Corporate Trust Office (as defined in the Trust Agreement); (e) in the case of
Xxxxx'x Investors Service, Inc., at the following address: Xxxxx'x Investors
Service, Inc., ABS Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, and (f) in the case of Standard & Poor's Ratings Services, a division
of The XxXxxx-Xxxx Companies, Inc., at the
16
following address: Standard & Poor's Rating Services, a division of The
XxXxxx-Xxxx Companies, Inc., 00 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Asset Backed Surveillance Department; or, as to each of the
foregoing, at such other address as shall be designated by written notice to
the other parties.
Section 7.08. Costs and Expenses. The Seller shall pay all expenses
incident to the performance of its obligations under this Agreement and the
Seller agrees to pay all reasonable out-of-pocket costs and expenses of the
Depositor, in connection with the perfection of the Depositor's, the Issuer's
and the Indenture Trustee's right, title and interest in and to the
Receivables and the enforcement of any obligation of the Seller hereunder as
contemplated by the Basic Documents.
Section 7.09. Representations of the Seller and the Depositor. The
respective agreements, representations, warranties and other statements by the
Seller and the Depositor set forth in or made pursuant to this Agreement shall
remain in full force and effect and will survive the closing under Section
2.02 and the transfers and assignments referred to in Section 7.04.
Section 7.10. Confidential Information. The Depositor agrees that it
will neither use nor disclose to any Person the names and addresses of the
Obligors or any other personally identifiable information of an Obligor,
except in connection with the enforcement of the Depositor's rights hereunder,
under the Receivables, under the Sale and Servicing Agreement or any other
Basic Document, or as required by any of the foregoing or by law.
Section 7.11. Headings and Cross-References. The various headings in
this Agreement are included for convenience only and shall not affect the
meaning or interpretation of any provision of this Agreement. References in
this Agreement to section names or numbers are to such Sections of this
Agreement.
Section 7.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS
CONFLICTS OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 7.13. Counterparts. This Agreement may be executed in
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same instrument.
Section 7.14. Third Party Beneficiary. The Indenture Trustee is an
express third party beneficiary of this Agreement and shall be entitled to
enforce the provisions of this Agreement as if it were a party hereto.
Section 7.15. No Proceedings. So long as this Agreement is in effect,
and for one year plus one day following its termination, (i) each of the
Seller and the Depositor agrees that it will not file any involuntary petition
or otherwise institute any bankruptcy, reorganization arrangement, insolvency
or liquidation proceeding or other proceedings under any federal or state
bankruptcy law or similar law against the Trust and (ii) the Seller agrees
that it will not file
17
any involuntary petition or otherwise institute any bankruptcy, reorganization
arrangement, insolvency or liquidation proceeding or other proceedings under
any federal or state bankruptcy law or similar law against the Depositor.
18
IN WITNESS WHEREOF, the parties hereto have caused this Receivables
Purchase Agreement to be executed by their respective duly authorized officers
as of the date and year first above written.
USAA FEDERAL SAVINGS BANK, as Seller
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: Senior Vice President
USAA ACCEPTANCE, LLC, as Depositor
By: /s/ Xxxxx X. XxXxxxxxx
-----------------------------------
Name: Xxxxx X. XxXxxxxxx
Title: Vice President
EXHIBIT A
MATTERS ADDRESSED IN OPINION OF SELLER'S COUNSEL
(a) the enforceability of the Basic Documents (other than the Trust
Agreement and the Note Depository Agreement);
(b) the validity of the security interests created thereby;
(c) the due issuance and enforceability of the Notes;
(d) the qualification of the Indenture under the Trust Indenture Act;
(e) no violations of law;
(f) compliance with applicable federal securities laws;
(g) exemption of the Bank, the Depositor and the Issuer from registration
as an investment company under the Investment Company Act of 1940;
(h) the conformity in all material respects of each of the Basic Documents
to the description thereof contained in the Registration Statement and the
Prospectus;
(i) negative assurances concerning the Prospectus, in each case in form and
substance reasonably satisfactory to the Representatives and their counsel;
(j) certain matters relating to the transfer of the Receivables by the
Seller to the Depositor, in form and substance reasonably satisfactory to the
Representatives and their counsel;
(k) the Issuer will not be an association (or a publicly traded
partnership) taxable as a corporation for federal income tax purposes; and
(l) the Notes will be characterized as indebtedness for federal income tax
purposes and (iii) the statements set forth in the Prospectus under the
heading "Certain Federal Income Tax Consequences", to the extent that they are
statements of law are true and correct in all material respects, in form and
substance reasonably satisfactory to the Representatives and their counsel.
A-1
SCHEDULE A
Schedule of Receivables
[On file with the Indenture Trustee]
S-A-1
SCHEDULE B
Location of Receivable Files
c/o USAA Federal Savings Bank
00000 XxXxxxxxx Xxxxxxx
Xxx Xxxxxxx, XX 00000
S-B-1
APPENDIX A
Definitions and Usage
(attached to the Sale and Servicing Agreement as Appendix A)
Appendix A-1
