Exhibit 10.3
(MULTICURRENCY--CROSS BORDER)
ISDA(R)
International Swap Dealers Association, Inc.
MASTER AGREEMENT
dated as of December 18, 2002
Xxxxxx Xxxxxxx Capital Services Inc. and MMCA Auto Owner Trust 2002-5
have entered and/or anticipate entering into one or more transactions (each a
"Transaction") that are or will be governed by this Master Agreement, which
includes the schedule (the "Schedule"), and the documents and other confirming
evidence (each a "Confirmation") exchanged between the parties confirming
those Transactions.
Accordingly, the parties agree as follows:
1. INTERPRETATION
(a) Definitions. The terms defined in Section 14 and in the Schedule will
have the meanings therein specified for the purpose of this Master
Agreement.
(b) Inconsistency. In the event of any inconsistency between the
provisions of the Schedule and the other provisions of this Master
Agreement, the Schedule will prevail. In the event of any
inconsistency between the provisions of any Confirmation and this
Master Agreement (including the Schedule), such Confirmation will
prevail for the purposes of the relevant Transaction.
(c) Single Agreement. All Transactions are entered into in reliance on
the fact that this Master Agreement and all Confirmations form a
single agreement between the parties (collectively referred to as
this "Agreement"), and the parties would not otherwise enter into any
Transactions.
2. OBLIGATIONS
(a) General Conditions.
(i) Each party will make each payment or delivery specified in each
Confirmation to be made by it, subject to the other provisions of
this Agreement.
(ii) Payments under this Agreement will be made on the due date for value
on that date in the place of the account specified in the relevant
Confirmation or otherwise pursuant to this Agreement, in freely
transferable funds and in the manner customary for payments in the
required currency. Where settlement is by delivery (that is, other
than by payment), such delivery will be made for receipt on the due
date in the manner customary for the relevant obligation unless
otherwise specified in the relevant Confirmation or elsewhere in this
Agreement.
(iii) Each obligation of each party under Section 2(a)(i) is subject to (1)
the condition precedent that no Event of Default or Potential Event
of Default with respect to the other party has occurred and is
continuing, (2) the condition precedent that no Early Termination
Date in respect of the relevant Transaction has occurred or been
effectively designated and (3) each other applicable condition
precedent specified in this Agreement.
(b) Change of Account. Either party may change its account for receiving
a payment or delivery by giving notice to the other party at least
five Local Business Days prior to the scheduled date for the payment
or delivery to which such change applies unless such other party
gives timely notice of a reasonable objection to such change.
(c) Netting. If on any date amounts would otherwise be payable:--
(i) in the same currency; and
(ii) in respect of the same Transaction,
by each party to the other, then, on such date, each party's obligation to
make payment of any such amount will be automatically satisfied and discharged
and, if the aggregate amount that would otherwise have been payable by one
party exceeds the aggregate amount that would otherwise have been payable by
the other party, replaced by an obligation upon the party by whom the larger
aggregate amount would have been payable to pay to the other party the excess
of the larger aggregate amount over the smaller aggregate amount.
The parties may elect in respect of two or more Transactions that a net amount
will be determined in respect of all amounts payable on the same date in the
same currency in respect of such Transactions, regardless of whether such
amounts are payable in respect of the same Transaction. The election may be
made in the Schedule or a Confirmation by specifying that subparagraph (ii)
above will not apply to the Transactions identified as being subject to the
election, together with the starting date (in which case subparagraph (ii)
above will not, or will cease to, apply to such Transactions from such date).
This election may be made separately for different groups of Transactions and
will apply separately to each pairing of Offices through which the parties
make and receive payments or deliveries.
(d) Deduction or Withholding for Tax.
(i) Gross-Up. All payments under this Agreement will be made
without any deduction or withholding for or on account of
any Tax unless such deduction or withholding is required by
any applicable law, as modified by the practice of any
relevant governmental revenue authority, then in effect. If
a party is so required to deduct or withhold, then that
party ("X") will:--
(1) promptly notify the other party ("Y") of such requirement;
(2) pay to the relevant authorities the full amount required to
be deducted or withheld (including the full amount required
to be deducted or withheld from any additional amount paid
by X to Y under this Section 2(d)) promptly upon the earlier
of determining that such deduction or withholding is
required or receiving notice that such amount has been
assessed against Y;
(3) promptly forward to Y an official receipt (or a certified
copy), or other documentation reasonably acceptable to Y,
evidencing such payment to such authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition
to the payment to which Y is otherwise entitled under this
Agreement, such additional amount as is necessary to ensure
that the net amount actually received by Y (free and clear
of Indemnifiable Taxes, whether assessed against X or Y)
will equal the full amount Y would have received had no such
deduction or withholding been required. However, X will not
be required to pay any additional amount to Y to the extent
that it would not be required to be paid but for:--
(A) the failure by Y to comply with or perform any agreement
contained in Section 4(a)(i), 4(a)(iii) or 4(d); or
(B) the failure of a representation made by Y pursuant to
Section 3(f) to be accurate and true unless such failure
would not have occurred but for (I) any action taken by a
taxing authority, or brought in a court of competent
jurisdiction, on or after the date on which a Transaction is
entered into (regardless of whether such action is taken or
brought with respect to a party to this Agreement) or (II) a
Change in Tax Law.
(ii) Liability. If:--
(1) X is required by any applicable law, as modified by the
practice of any relevant governmental revenue authority, to
make any deduction or withholding in respect of which X
would not be required to pay an additional amount to Y under
Section 2(d)(i)(4);
(2) X does not so deduct or withhold; and
(3) a liability resulting from such Tax is assessed directly
against X,
then, except to the extent Y has satisfied or then satisfies
the liability resulting from such Tax, Y will promptly pay
to X the amount of such liability (including any related
liability for interest, but including any related liability
for penalties only if Y has failed to comply with or perform
any agreement contained in Section 4(a)(i), 4(a)(iii) or
4(d)).
(e) Default Interest; Other Amounts. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant
Transaction, a party that defaults in the performance of any payment
obligation will, to the extent permitted by law and subject to Section 6(c),
be required to pay interest (before as well as after judgment) on the overdue
amount to the other party on demand in the same currency as such overdue
amount, for the period from (and including) the original due date for payment
to (but excluding) the date of actual payment, at the Default Rate. Such
interest will be calculated on the basis of daily compounding and the actual
number of days elapsed. If, prior to the occurrence or effective designation
of an Early Termination Date in respect of the relevant Transaction, a party
defaults in the performance of any obligation required to be settled by
delivery, it will compensate the other party on demand if and to the extent
provided for in the relevant Confirmation or elsewhere in this Agreement.
3. REPRESENTATIONS
Each party represents to the other party (which representations will be deemed
to be repeated by each party on each date on which a Transaction is entered
into and, in the case of the representations in Section 3(f), at all times
until the termination of this Agreement) that:--
(a) Basic Representations.
(i) Status. It is duly organized and validly existing under the laws of
the jurisdiction of its organization or incorporation and, if
relevant under such laws, in good standing;
(ii) Powers. It has the power to execute this Agreement and any other
documentation relating to this Agreement to which it is a party, to
deliver this Agreement and any other documentation relating to this
Agreement that it is required by this Agreement to deliver and to
perform its obligations under this Agreement and any obligations it
has under any Credit Support Document to which it is a party and has
taken all necessary action to authorise such execution, delivery and
performance;
(iii) No Violation or Conflict. Such execution, delivery and performance do
not violate or conflict with any law applicable to it, any provision
of its constitutional documents, any order or judgment of any court
or other agency of government applicable to it or any of its assets
or any contractual restriction binding on or affecting it or any of
its assets;
(iv) Consents. All governmental and other consents that are required to
have been obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party have been obtained and are in
full force and effect and all conditions of any such consents have
been complied with; and
(v) Obligations Binding. Its obligations under this Agreement and any
Credit Support Document to which it is a party constitute its legal,
valid and binding obligations, enforceable in accordance with their
respective terms (subject to applicable bankruptcy, reorganisation,
insolvency, moratorium or similar laws affecting creditors' rights
generally and subject, as to enforceability, to equitable principles
of general application (regardless of whether enforcement is sought
in a proceeding in equity or at law)).
(b) Absence of Certain Events. No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it
has occurred and is continuing and no such event or circumstance
would occur as a result of its entering into or performing its
obligations under this Agreement or any Credit Support Document to
which it is a party.
(c) Absence of Litigation. There is not pending or, to its knowledge,
threatened against it or any of its Affiliates any action, suit or
proceeding at law or inequity or before any court, tribunal,
governmental body, agency or official or any arbitrator that is
likely to affect the legality, validity or enforceability against it
of this Agreement or any Credit Support Document to which it is a
party or its ability to perform its obligations under this Agreement
or such Credit Support Document.
(d) Accuracy of Specified Information. All applicable information that is
furnished in writing by or on behalf of it to the other party and is
identified for the purpose of this Section 3(d) in the Schedule is,
as of the date of the information, true, accurate and complete in
every material respect.
(e) Payer Tax Representation. Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(e) is
accurate and true.
(f) Payee Tax Representations. Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(f) is
accurate and true.
4. AGREEMENTS
Each party agrees with the other that, so long as either party has or may have
any obligation under this Agreement or under any Credit Support Document to
which it is a party:--
(a) Furnish Specified Information. It will deliver to the other party or,
in certain cases under subparagraph (iii) below, to such government
or taxing authority as the other party reasonably directs:--
(i) any forms, documents or certificates relating to taxation specified
in the Schedule or any Confirmation;
(ii) any other documents specified in the Schedule or any Confirmation;
and
(iii) upon reasonable demand by such other party, any form or document that
may be required or reasonably requested in writing in order to allow
such other party or its Credit Support Provider to make a payment
under this Agreement or any applicable Credit Support Document
without any deduction or withholding for or on account of any Tax or
with such deduction or withholding at a reduced rate (so long as the
completion, execution or submission of such form or document would
not materially prejudice the legal or commercial position of the
party in receipt of such demand), with any such form or document to
be accurate and completed in a manner reasonably satisfactory to such
other party and to be executed and to be delivered with any
reasonably required certification,
in each case by the date specified in the Schedule or such Confirmation or, if
none is specified, as soon as reasonably practicable.
(b) Maintain Authorisations. It will use all reasonable efforts to
maintain in full force and effect all consents of any governmental or
other authority that are required to be obtained by it with respect
to this Agreement or any Credit Support Document to which it is a
party and will use all reasonable efforts to obtain any that may
become necessary in the future.
(c) Comply with Laws. It will comply in all material respects with all
applicable laws and orders to which it may be subject if failure so
to comply would materially impair its ability to perform its
obligations under this Agreement or any Credit Support Document to
which it is a party.
(d) Tax Agreement. It will give notice of any failure of a representation
made by it under Section 3(f) to be accurate and true promptly upon
learning of such failure.
(e) Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp
Tax levied or imposed upon' it or in respect of its execution or
performance of this Agreement by a jurisdiction in which it is
incorporated, organised, managed and controlled, or considered to
have its seat, or in which a branch or office through which it is
acting for the purpose of this Agreement is located ("Stamp Tax
Jurisdiction") and will indemnify the other party against any Stamp
Tax levied or imposed upon the other party or in respect of the other
party's execution or performance of this Agreement by any such Stamp
Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with
respect to the other party.
5. EVENTS OF DEFAULT AND TERMINATION EVENTS
(a) Events of Default. The occurrence at any time with respect to a party
or, if applicable, any Credit Support Provider of such party or any
Specified Entity of such party of any of the following events
constitutes an event of default (an "Event of Default") with respect
to such party:--
(i) Failure to Pay or Deliver. Failure by the party to make, when due,
any payment under this Agreement or delivery under Section 2(a)(i) or
2(e) required to be made by it if such failure is not remedied on or
before the third Local Business Day after notice of such failure is
given to the party;
(ii) Breach of Agreement. Failure by the party to comply with or perform
any agreement or obligation (other than an obligation to make any
payment under this Agreement or delivery under Section 2(a)(i) or
2(e) or to give notice of a Termination Event or any agreement or
obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied
with or performed by the party in accordance with this Agreement if
such failure is not remedied on or before the thirtieth day after
notice of such failure is given to the party;
(iii) Credit Support Default.
(1) Failure by the party or any Credit Support Provider of such party to
comply with or perform any agreement or obligation to be complied
with or performed by it in accordance with any Credit Support
Document if such failure is continuing after any applicable grace
period has elapsed;
(2) the expiration or termination of such Credit Support Document or the
failing or ceasing of such Credit Support Document to be in full
force and effect for the purpose of this Agreement (in either case
other than in accordance with its terms) prior to the satisfaction of
all obligations of such party under each Transaction to which such
Credit Support Document relates without the written consent of the
other party; or
(3) the party or such Credit Support Provider disaffirms, disclaims,
repudiates or rejects, in whole or in part, or challenges the
validity of, such Credit Support Document;
(iv) Misrepresentation. A representation (other than a representation
under Section 3(e) or (f)) made or repeated or deemed to have been
made or repeated by the party or any Credit Support Provider of such
party in this Agreement or any Credit Support Document proves to have
been incorrect or misleading in any material respect when made or
repeated or deemed to have been made or repeated;
(v) Default under Specified Transaction. The party, any Credit Support
Provider of such party or any applicable Specified Entity of such
party (l) defaults under a Specified Transaction and, after giving
effect to any applicable notice requirement or grace period, there
occurs a liquidation of, an acceleration of obligations under, or an
early termination of, that Specified Transaction, (2) defaults, after
giving effect to any applicable notice requirement or grace period,
in making any payment or delivery due on the last payment, delivery
or exchange date of, or any payment on early termination of, a
Specified Transaction (or such default continues for at least three
Local Business Days if there is no applicable notice requirement or
grace period) or (3) disaffirms, disclaims, repudiates or rejects, in
whole or in part, a Specified Transaction (or such action is taken by
any person or entity appointed or empowered to operate it or act on
its behalf);
(vi) Cross Default. If "Cross Default" is specified in the Schedule as
applying to the party, the occurrence or existence of (l) a default,
event of default or other similar condition or event (however
described) in respect of such party, any Credit Support Provider of
such party or any applicable Specified Entity of such party under one
or more agreements or instruments relating to Specified Indebtedness
of any of them (individually or collectively) in an aggregate amount
of not less than the applicable Threshold Amount (as specified in the
Schedule) which has resulted in such Specified Indebtedness becoming,
or becoming capable at such time of being declared, due and payable
under such agreements or instruments, before it would otherwise have
been due and payable or (2) a default by such party, such Credit
Support Provider or such Specified Entity (individually or
collectively) in making one or more payments on the due date thereof
in an aggregate amount of not less than the applicable Threshold
Amount under such agreements or instruments (after giving effect to
any applicable notice requirement or grace period);
(vii) Bankruptcy. The party, any Credit Support Provider of such party or
any applicable Specified Entity of such party:--
(1) is dissolved (other than pursuant to a consolidation,
amalgamation or merger); (2) becomes insolvent or is unable to
pay its debts or fails or admits in writing its inability
generally to pay its debts as they become due; (3) makes a
general assignment, arrangement or composition with or for the
benefit of its creditors; (4) institutes or has instituted
against it a proceeding seeking a judgment of insolvency or
bankruptcy or any other relief under any bankruptcy or
insolvency law or other similar law affecting creditors' rights,
or a petition is presented for its winding-up or liquidation,
and, in the case of any such proceeding or petition instituted
or presented against it, such proceeding or petition (A) results
in a judgment of insolvency or bankruptcy or the entry of an
order for relief or the making of an order for its winding-up or
liquidation or (B) is not dismissed, discharged, stayed or
restrained in each case within 30 days of the institution or
presentation thereof; (5) has a resolution passed for its
winding-up, official management or liquidation (other than
pursuant to a consolidation, amalgamation or merger); (6) seeks
or becomes subject to the appointment of an administrator,
provisional liquidator, conservator, receiver, trustee,
custodian or other similar official for it or for all or
substantially all its assets; (7) has a secured party take
possession of all or substantially all its assets or has a
distress, execution, attachment, sequestration or other legal
process levied, enforced or sued on or against all or
substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged,
stayed or restrained, in each case within 30 days thereafter;
(8) causes or is subject to any event with respect to it which,
under the applicable laws of any jurisdiction, has an analogous
effect to any of the events specified in clauses (1) to (7)
(inclusive); or (9) takes any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any
of the foregoing acts; or
(viii) Merger Without Assumption. The party or any Credit Support Provider
of such party consolidates or amalgamates with, or merges with or
into, or transfers all or substantially all its assets to, another
entity and, at the time of such consolidation, amalgamation, merger
or transfer:--
(1) the resulting, surviving or transferee entity fails to assume all the
obligations of such party or such Credit Support Provider under this
Agreement or any Credit Support Document to which it or its
predecessor was a party by operation of law or pursuant to an
agreement reasonably satisfactory to the other party to this
Agreement; or
(2) the benefits of any Credit Support Document fail to extend (without
the consent of the other party) to the performance by such resulting,
surviving or transferee entity of its obligations under this
Agreement.
(b) Termination Events. The occurrence at any time with respect to a
party or, if applicable, any Credit Support Provider of such party or
any Specified Entity of such party of any event specified below
constitutes an Illegality if the event is specified in (i) below, a
Tax Event if the event is specified in (ii) below, or a Tax Event
Upon Merger if the event is specified in (iii) below, and, if
specified to be applicable, a Credit Event Upon Merger if the event
is specified pursuant to (iv) below, or an Additional Termination
Event if the event is specified pursuant to (v) below:--
(i) Illegality. Due to the adoption of, or any change in, any applicable
law after the date on which a Transaction is entered into, or due to
the promulgation of, or any change in, the interpretation by any
court, tribunal or regulatory authority with competent jurisdiction
of any applicable law after such date, it becomes unlawful (other
than as a result of a breach by the party of Section 4(b)) for such
party (which will be the Affected Party):--
(1) to perform any absolute or contingent obligation to make a payment or
delivery or to receive a payment or delivery in respect of such
Transaction or to comply with any other material provision of this
Agreement relating to such Transaction; or
(2) to perform, or for any Credit Support Provider of such party to
perform, any contingent or other obligation which the party (or such
Credit Support Provider) has under any Credit Support Document
relating to such Transaction;
(ii) Tax Event. Due to (x) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on
which a Transaction is entered into (regardless of whether such
action is taken or brought with respect to a party to this Agreement)
or (y) a Change in Tax Law, the party (which will be the Affected
Party) will, or there is a substantial likelihood that it will, on
the next succeeding Scheduled Payment Date (1) be required to pay to
the other party an additional amount in respect of an Indemnifiable
Tax under Section 2(d)(i)(4) (except in respect of interest under
Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which
an amount is required to be deducted or withheld for or on account of
a Tax (except in respect of Interest under Section 2(e), 6(d)(ii) or
6(e)) and no additional amount is required to be paid in respect of
such Tax under Section 2(d)(i)(4) (other than by reason of Section
2(d)(i)(4)(A) or (B));
(iii) Tax Event Upon Merger. The party (the "Burdened Party") on the next
succeeding Scheduled Payment Date will either (1) be required to pay
an additional amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section 2(e),
6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has
been deducted or withheld for or on account of an Indemnifiable Tax
in respect of which the other party is not required to pay an
additional amount (other than by reason of Section 2(d)(i)(4)(A) or
(B)), in either case as a result of a party consolidating or
amalgamating with, or merging with or into, or transferring all or
substantially all its assets to, another entity (which will be the
Affected Party) where such action does not constitute an event
described in Section 5(a)(viii);
(iv) Credit Event Upon Merger. If "Credit Event Upon Merger" is specified
in the Schedule as applying to the party, such party ("X"), any
Credit Support Provider of X or any applicable Specified Entity of X
consolidates or amalgamates with, or merges with or into, or
transfers all or substantially all its assets to, another entity and
such action does not constitute an event described in Section
5(a)(viii) but the creditworthiness of the resulting, surviving or
transferee entity is materially weaker than that of X, such Credit
Support Provider or such Specified Entity, as the case may be,
immediately prior to such action (and, in such event, X or its
successor or transferee, as appropriate, will be the Affected Party);
or
(v) Additional Termination Event. If any "Additional Termination Event"
is specified in the Schedule or any Confirmation as applying, the
occurrence of such event (and, in such event, the Affected Party or
Affected Parties shall be as specified for such Additional
Termination Event in the Schedule or such Confirmation).
(c) Event of Default and Illegality. If an event or circumstance which
would otherwise constitute or give rise to an Event of Default also
constitutes an Illegality, it will be treated as an Illegality and
will not constitute an Event of Default.
6. EARLY TERMINATION
(a) Right to Terminate Following Event of Default. If at any time an
Event of Default with respect to a party (the "Defaulting Party") has
occurred and is then continuing, the other party (the "Non-defaulting
Party") may, by not more than 20 days notice to the Defaulting Party
specifying the relevant Event of Default, designate a day not earlier
than the day such notice is effective as an Early Termination Date in
respect of all outstanding Transactions. If, however, "Automatic
Early Termination" is specified in the Schedule as applying to a
party, then an Early Termination Date in respect of all outstanding
Transactions will occur immediately upon the occurrence with respect
to such party of an Event of Default specified in Section
5(a)(vii)(1), (3), (5), (6) or, to the extent analogous thereto, (8),
and as of the time immediately preceding the institution of the
relevant proceeding or the presentation of the relevant petition upon
the occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous
thereto, (8).
(b) Right to Terminate Following Termination Event.
(i) Notice. If a Termination Event occurs, an Affected Party will,
promptly upon becoming aware of it, notify the other party,
specifying the nature of that Termination Event and each Affected
Transaction and will also give such other information about that
Termination Event as the other party may reasonably require.
(ii) Transfer to Avoid Termination Event. If either an Illegality under
Section 5(b)(i)(1) or a Tax Event occurs and there is only one
Affected Party, or if a Tax Event Upon Merger occurs and the Burdened
Party is the Affected Party, the Affected Party will, as a condition
to its right to designate an Early Termination Date under Section
6(b)(iv), use all reasonable efforts (which will not require such
party to incur a loss, excluding immaterial, incidental expenses) to
transfer within 20 days after it gives notice under Section 6(b)(i)
all its rights and obligations under this Agreement in respect of the
Affected Transactions to another of its Offices or Affiliates so that
such Termination Event ceases to exist.
If the Affected Party is not able to make such a transfer it will
give notice to the other party to that effect within such 20 day
period, whereupon the other party may effect such a transfer within
30 days after the notice is given under Section 6(b)(i).
Any such transfer by a party under this Section 6(b)(ii) will be
subject to and conditional upon the prior written consent of the
other party, which consent will not be withheld if such other party's
policies in effect at such time would permit it to enter into
transactions with the transferee on the terms proposed.
(iii) Two Affected Parties. If an Illegality under Section
5(b)(i)(1) or a Tax Event occurs and there are two Affected
Parties, each party will use all reasonable efforts to reach
agreement within 30 days after notice thereof is given under
Section 6(b)(i) on action to avoid that Termination Event.
(iv) Right to Terminate. If:--
(1) a transfer under Section 6(b)(ii) or an agreement under
Section 6(b)(iii), as the case may be, has not been effected
with respect to all Affected Transactions within 30 days
after an Affected Party gives notice under Section 6(b)(i);
or
(2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon
Merger or an Additional Termination Event occurs, or a Tax
Event Upon Merger occurs and the Burdened Party is not the
Affected Party,
either party in the case of an Illegality, the Burdened Party in the
case of a Tax Event Upon Merger, any Affected Party in the case of a
Tax Event or an Additional Termination Event if there is more than
one Affected Party, or the party which is not the Affected Party in
the case of a Credit Event Upon Merger or an Additional Termination
Event if there is only one Affected Party may, by not more than 20
days notice to the other party and provided that the relevant
Termination Event is then continuing, designate a day not earlier
than the day such notice is effective as an Early Termination Date in
respect of all Affected Transactions.
(c) Effect of Designation.
(i) If notice designating an Early Termination Date is
given under Section 6(a) or (b), the Early
Termination Date will occur on the date so
designated, whether or not the relevant Event of
Default, or Termination Event is then continuing.
(ii) Upon the occurrence or effective designation of an
Early Termination Date, no further payments or
deliveries under Section 2(a)(i) or 2(e) in respect
of the Terminated Transactions will be required to
be made, but without prejudice to the other
provisions of this Agreement. The amount, if any,
payable in respect of an Early Termination Date
shall be determined pursuant to Section 6(e).
(d) Calculations.
(i) Statement. On or as soon as reasonably practicable following the
occurrence of an Early Termination Date, each party will make the
calculations on its part, if any, contemplated by Section 6(e) and
will provide to the other party a statement (1) showing, in
reasonable detail, such calculations (including all relevant
quotations and specifying any amount payable under Section 6(e)) and
(2) giving details of the relevant account to which any amount
payable to it is to be paid. In the absence of written confirmation
from the source of a quotation obtained in determining a Market
Quotation, the records of the party obtaining such quotation will be
conclusive evidence of the existence and accuracy of such quotation.
(ii) Payment Date. An amount calculated as being due in respect of any
Early Termination Date under Section 6(e) will be payable on the day
that notice of the amount payable is effective (in the case of an
Early Termination Date which is designated or occurs as a result of
an Event of Default) and on the day which is two Local Business Days
after the day on which notice of the amount payable is effective (in
the case of an Early Termination Date which is designated as a result
of a Termination Event). Such amount will be paid together with (to
the extent permitted under applicable law) interest thereon (before
as well as after judgment) in the Termination Currency, from (and
including) the relevant Early Termination Date to (but excluding) the
date such amount, is paid, at the Applicable Rate. Such interest will
be calculated on the basis of daily compounding and the actual number
of days elapsed.
(e) Payments on Early Termination. If an Early
Termination Date occurs, the following provisions
shall apply based on the parties' election in the
Schedule of a payment measure, either "Market
Quotation" or "Loss", and a payment method, either
the "First Method" or the "Second Method". If the
parties fail to designate a payment measure or
payment method in the Schedule, it will be deemed
that "Market Quotation"or the "Second Method", as
the case may be, shall apply. The amount, if any,
payable in respect of an Early Termination Date and
determined pursuant to this Section will be subject
to any Set-off.
(i) Events of Default. If the Early Termination Date
results from an Event of Default:--
(1) First Method and Market Quotation. If the First
Method and Market Quotation apply, the Defaulting
Party will pay to the Non-defaulting Party the
excess, if a positive number, of (A) the sum of the
Settlement Amount (determined by the Non-defaulting
Party) in respect of the Terminated Transactions
and the Termination Currency Equivalent of the
Unpaid Amounts owing to the Non-defaulting Party
over (B) the Termination Currency Equivalent of the
Unpaid Amounts owing to the Defaulting Party.
(2) First Method and Loss. If the First Method and Loss
apply, the Defaulting Party will pay to the
Non-defaulting Party, if a positive number, the
Non-defaulting Party's Loss in respect of this
Agreement.
(3) Second Method and Market Quotation. If the Second
Method and Market Quotation apply, an amount will
be payable equal to (A) the sum of the Settlement
Amount (determined by the Non-defaulting Party) in
respect of the Terminated Transactions and the
Termination Currency Equivalent of the Unpaid
Amounts owing to the Non-defaulting Party less (B)
the Termination Currency Equivalent of the Unpaid
Amounts owing to the Defaulting Party. If that
amount is a positive number, the Defaulting Party
will pay it to the Non-defaulting Party; if it is a
negative number, the Non-defaulting Party will pay
the absolute value of that amount to the Defaulting
Party.
(4) Second Method and Loss. If the Second Method and
Loss apply, an amount will be payable equal to the
Non-defaulting Party's Loss in respect of this
Agreement. If that amount is a positive number, the
Defaulting Party will pay it to the Non-defaulting
Party; if it is a negative number, the
Non-defaulting Party will pay the absolute value of
that amount to the Defaulting Party.
(ii) Termination Events. If the Early Termination Date
results from a Termination Event:--
(1) One Affected Party. If there is one Affected Party,
the amount payable will be determined in accordance
with Section 6(e)(i)(3), if Market Quotation
applies, or Section 6(e)(i)(4), if Loss applies,
except that, in either case, references to the
Defaulting Party and to the Non-defaulting Party
will be deemed to be references to the Affected
Party and the party which is not the Affected
Party, respectively, and, if Loss applies and fewer
than all the Transactions are being terminated,
Loss shall be calculated in respect of all
Terminated Transactions.
(2) Two Affected Parties. If there are two Affected
Parties:--
(A) if Market Quotation applies, each party will
determine a Settlement Amount in respect of the
Terminated Transactions, and an amount will be
payable equal to (I) the sum of (a) one-half of the
difference between the Settlement Amount of the
party with the higher Settlement Amount ("X") and
the Settlement Amount of the party with the lower
Settlement Amount ("Y") and (b) the Termination
Currency Equivalent of the Unpaid Amounts owing to
X less (II) the Termination Currency Equivalent of
the Unpaid Amounts owing to Y; and
(B) if Loss applies, each party will determine its Loss
in respect of this Agreement (or, if fewer than all
the Transactions are being terminated, in respect
of all Terminated Transactions) and an amount will
be payable equal to one-half of the difference
between the Loss of the party with the higher Loss
("X") and the Loss of the party with the lower Loss
("Y").
If the amount payable is a positive number, Y will pay it to
X; if it is a negative number, X will pay the absolute value
of that amount to Y.
(iii) Adjustment for Bankruptcy. In circumstances where an Early
Termination Date occurs because "Automatic Early Termination" applies
in respect of a party, the amount determined under this Section 6(e)
will be subject to such adjustments as are appropriate and permitted
by law to reflect any payments or deliveries made by one party to the
other under this Agreement (and retained by such other party) during
the period from the relevant Early Termination Date to the date for
payment determined under Section 6(d)(ii).
(iv) Pre-Estimate. The parties agree that if Market Quotation applies an
amount recoverable under this Section 6(e) is a reasonable
pre-estimate of loss and not a penalty. Such amount is payable for
the loss of bargain and the loss of protection against future risks
and except as otherwise provided in this Agreement neither party will
be entitled to recover any additional damages as a consequence of
such losses.
7. TRANSFER
Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by way of
security or otherwise) by either party without the prior written consent of
the other party, except that:--
(a) a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to
any other right or remedy under this Agreement); and
(b) a party may make such a transfer of all or any part of its interest in any
amount payable to it from a Defaulting Party under Section 6(e).
Any purported transfer that is not in compliance with this Section will be
void.
8. CONTRACTUAL CURRENCY
(a) Payment in the Contractual Currency. Each payment under this
Agreement will he made in the relevant currency specified in this
Agreement for that payment (the "Contractual Currency"). To the
extent permitted by applicable law, any obligation to make payments
under this Agreement in the Contractual Currency will not be
discharged or satisfied by any tender in any currency other than the
Contractual Currency, except to the extent such tender results in the
actual receipt by the party to which payment is owed, acting in a
reasonable manner and in good faith in converting the currency so
tendered into the Contractual Currency, of the full amount in the
Contractual Currency of all amounts payable in respect of this
Agreement. If for any reason the amount in the Contractual Currency
so received falls short of the amount in the Contractual Currency
payable in respect of this Agreement, the party required to make the
payment will, to the extent permitted by applicable law, immediately
pay such additional amount in the Contractual Currency as may be
necessary to compensate for the shortfall. If for any reason the
amount in the Contractual Currency so received exceeds the amount in
the Contractual Currency payable in respect of this Agreement, the
party receiving the payment will refund promptly the amount of such
excess.
(b) Judgments. To the extent permitted by applicable law, if any judgment
or order expressed in a currency other than the Contractual Currency
is rendered (i) for the payment of any amount owing in respect of
this Agreement, (ii) for the payment of any amount relating to any
early termination in respect of this Agreement or (iii) in respect of
a judgment or order of another court for the payment of any amount
described in (i) or (ii) above, the party seeking recovery, after
recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to
receive immediately from the other party the amount of any shortfall
of the Contractual Currency received by such party as a consequence
of sums paid in such other currency and will refund promptly to the
other party any excess of the Contractual Currency received by such
party as a consequence of sums paid in such other currency if such
shortfall or such excess arises or results from any variation between
the rate of exchange at which the Contractual Currency is converted
into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is
able, acting in a reasonable manner and in good faith in converting
the currency received into the Contractual Currency, to purchase the
Contractual Currency with the amount of the currency of the judgment
or order actually received by such party. The term "rate of exchange"
includes, without limitation, any premiums and costs of exchange
payable in connection with the purchase of or conversion into the
Contractual Currency.
(c) Separate Indemnities. To the extent permitted by applicable law,
these indemnities constitute separate and independent obligations
from the other obligations in this Agreement, will be enforceable as
separate and independent causes of action, will apply notwithstanding
any indulgence granted by the party to which any payment is owed and
will not be affected by judgment being obtained or claim or proof
being made for any other sums payable in respect of this Agreement.
(d) Evidence of Loss. For the purpose of this Section 8, it will he
sufficient for a party to demonstrate that it would have suffered a
loss had an actual exchange or purchase been made.
9. MISCELLANEOUS
(a) Entire Agreement. This Agreement constitutes the entire agreement and
understanding of the parties with respect to its subject matter and
supersedes all oral communication and prior writings with respect
thereto.
(b) Amendments. No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing
evidenced by a facsimile transmission) and executed by each of the
parties or confirmed by an exchange of telexes or electronic messages
on an electronic messaging system.
(c) Survival of Obligations. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will
survive the termination of any Transaction.
(d) Remedies Cumulative. Except as provided in this Agreement, the
rights, powers, remedies and privileges provided in this Agreement
are cumulative and not exclusive of any rights, powers, remedies and
privileges provided by law.
(e) Counterparts and Confirmations.
(i) This Agreement (and each amendment, modification and waiver in
respect of it) may be executed and delivered in counterparts
(including by facsimile transmission), each of which will he deemed
an original.
(ii) The parties intend that they are legally bound by the terms of each
Transaction from the moment they agree to those terms (whether orally
or otherwise). A Confirmation shall be entered into as soon as
practicable and may be executed and delivered in counterparts
(including by facsimile transmission) or be created by an exchange of
telexes or by an exchange of electronic messages on an electronic
messaging system, which in each case will be sufficient for all
purposes to evidence a binding supplement to this Agreement. The
parties will specify therein or through another effective means that
any such counterpart, telex or electronic message constitutes a
Confirmation.
(f) No Waiver of Rights. A failure or delay in exercising any right,
power or privilege in respect of this Agreement will not be presumed
to operate as a waiver, and a single or partial exercise of any
right, power or privilege will not be presumed to preclude any
subsequent or further exercise, of that right, power or privilege or
the exercise of any other right, power or privilege.
(g) Headings. The headings used in this Agreement are for convenience of
reference only and are not to affect the construction of or to be
taken into consideration in interpreting this Agreement.
10. OFFICES; MULTIBRANCH PARTIES
(a) If Section 10(a) is specified in the Schedule as applying, each party
that enters into a Transaction through an Office other than its head
or home office represents to the other party that, notwithstanding
the place of booking office or jurisdiction of incorporation or
organization of such party, the obligations of such party are the
same as if it had entered into the Transaction through its head or
home office. This representation will be deemed to be repeated by
such party on each date on which a Transaction is entered into.
(b) Neither party may change the Office through which it makes and
receives payments or deliveries for the purpose of a Transaction
without the prior written consent of the other party.
(c) If a party is specified as a Multibranch Party in the Schedule, such
Multibranch Party may make and receive payments or deliveries under
any Transaction through any Office listed in the Schedule, and the
Office through which it makes and receives payments or deliveries
with respect to a Transaction will be specified in the relevant
Confirmation.
11. EXPENSES
A Defaulting Party will, on demand, indemnify and hold harmless the other
party for and against all reasonable out-of-pocket expenses, including legal
fees and Stamp Tax, incurred by such other party by reason of the enforcement
and protection of its rights under this Agreement or any Credit Support
Document to which the Defaulting Party is a party or by reason of the early
termination of any Transaction, including, but not limited to, costs of
collection.
12. NOTICES
(a) Effectiveness. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a
notice or other communication under Section 5 or 6 may not be given
by facsimile transmission or electronic messaging system) to the
address or number or in accordance with the electronic messaging
system details provided (see the Schedule) and will be deemed
effective as indicated:--
(i) if in writing and delivered in person or by courier, on the date it
is delivered;
(ii) if sent by telex, on the date the recipient's answer back is
received;
(iii) if sent by facsimile transmission, on the date that transmission is
received by a responsible employee of the recipient in legible form
(it being agreed that the burden of proving receipt will be on the
sender and will not be met by a transmission report generated by the
sender's facsimile machine);
(iv) if sent by certified or registered mail (airmail, if overseas) or the
equivalent (return receipt requested), on the date that mail is
delivered or its delivery is attempted; or
(v) if sent by electronic messaging system, on the date that electronic
message is received,
unless the date of that delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is delivered (or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.
(b) Change of Addresses. Either party may by notice to the other change
the address, telex or facsimile number or electronic messaging system
details at which notices or other communications are to be given to
it.
13. GOVERNING LAW AND JURISDICTION
(a) Governing Law. This Agreement will be governed by and construed in
accordance with the law specified in the Schedule.
(b) Jurisdiction. With respect to any suit, action or proceedings
relating to this Agreement ("Proceedings"), each party irrevocably:--
(i) submits to the jurisdiction of the English courts, if this Agreement
is expressed to be governed by English law, or to the non-exclusive
jurisdiction of the courts of the State of New York and the United
States District Court located in the Borough of Manhattan in New York
City, if this Agreement is expressed to be governed by the laws of
the State of New York; and
(ii) waives any objection which it may have at any time to the laying of
venue of any Proceedings brought in any such court, waives any claim
that such Proceedings have been brought in an inconvenient forum and
further waives the right to object, with respect to such Proceedings,
that such court does not have any jurisdiction over such party.
Nothing in this Agreement precludes either party from bringing Proceedings in
any other jurisdiction (outside, if this Agreement is expressed to be governed
by English law, the Contracting States, as defined in Section 1(3) of the
Civil Jurisdiction and Judgments Xxx 0000 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.
(c) Service of Process. Each party irrevocably appoints the Process Agent (if
any) specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. If for any reason any party's
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable
to the other party. The parties irrevocably consent to service of process
given in the manner provided for notices in Section 12. Nothing in this
Agreement will affect the right of either party to serve process in any other
manner permitted by law.
(d) Waiver of Immunities. Each party irrevocably waives, to the fullest extent
permitted by applicable law, with respect to itself and its revenues and
assets (irrespective of their use or intended use), all immunity on the
grounds of sovereignty or other similar grounds from (i) suit, (ii)
jurisdiction of any court, (iii) relief by way of injunction, order for
specific performance or for recovery of property, (iv) attachment of its
assets (whether before or after judgment) and (v) execution or enforcement of
any judgment to which it or its revenues or assets might otherwise be entitled
in any Proceedings in the courts of any jurisdiction and irrevocably agrees,
to the extent permitted by applicable law, that it will not claim any such
immunity in any Proceedings.
14. DEFINITIONS
As used in this Agreement:--
"Additional Termination Event" has the meaning specified in Section 5(b).
"Affected Party" has the meaning specified the Section 5(b).
"Affected Transactions" means (a) with respect to any Termination Event
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and (b) with
respect to any other Termination Event, all Transactions.
"Affiliate" means, subject to the Schedule, in relation to any person, any
entity controlled, directly or indirectly, by the person, any entity that
controls, directly or indirectly, the person or any entity directly or
indirectly under common control with the person. For this purpose, "control"
of any entity or person means ownership of a majority of the voting power of
the entity or person.
"Applicable Rate" means:--
(a) in respect of obligations payable or deliverable (or which would have been
but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;
(b) in respect of an obligation to pay an amount under Section 6(e) of either
party from and after the Rate (determined in accordance with Section 6(d)(ii))
on which that amount is payable, the Default Rate;
(c) in respect of all other obligations payable or deliverable (or which would
have been but for Section 2(a)(iii)) by a Non-defaulting Party, the
Non-default Rate; and
(d) in all other cases, the Termination Rate.
"Burdened Party" has the meaning specified in Section 5(b).
"Change in Tax Law" means the enactment, promulgation, execution or
ratification of, or any change in or amendment to, any law (or in the
application or official interpretation of any law)'that occurs on or after the
date on which the relevant Transaction is entered into.
"consent" includes a consent, approval, action, authorization, exemption,
notice, filing, registration or exchange control consent.
"Credit Event Upon Merger" has the meaning specified in Section 5(b).
"Credit Support Document" means any agreement or instrument that is specified
as such in this Agreement.
"Credit Support Provider" has the meaning specified in the Schedule.
"Default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the relevant payee (as certified by it) if it
were to fund or of funding the relevant amount plus 1% per annum.
"Defaulting Party" has the meaning specified in Section 6(a).
"Early Termination Date" means the date determined in accordance with Section
6(a) or 6(b)(iv).
"Event of Default" has the meaning specified in Section 5(a) and, if
applicable, in the Schedule. "Illegality" has the meaning specified in Section
5(b).
"Indemnifiable Tax" means any Tax other than a Tax that would not be imposed
in respect of a payment under this Agreement but for a present or former
connection between the jurisdiction of the government or taxation authority
imposing such Tax and the recipient of such payment or a person related to
such recipient (including, without limitation, a connection arising from such
recipient or related person being or having been a citizen or resident of such
jurisdiction, or being or having been organized, present or engaged in a trade
or business in such jurisdiction, or having or having had a permanent
establishment or fixed place of business in such jurisdiction, but excluding a
connection arising solely from such recipient, or related person having
executed, delivered, performed its obligations or received a payment under, or
enforced, this Agreement or a Credit Support Document).
"law" includes any treaty, law, rule or regulation (as modified, in the case
of tax matters, by the practice of any relevant governmental revenue
authority) and "lawful" and "unlawful" will be construed accordingly.
"Local Business Day" means, subject to the Schedule, a day on which commercial
banks are open for business (including dealings in foreign exchange and
foreign currency deposits) (a) in relation to any obligation under Section
2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so
specified, as otherwise agreed by the parties in writing or determined
pursuant to provisions contained, or incorporated by reference, in this
Agreement, (b) in relation to any other payment, in the place where the
relevant account is located and, if different, in the principal financial
center, if any, of the currency of such payment, (c) in relation to any notice
or other communication, including notice contemplated under Section 5(a)(i),
in the city specified in the address for notice provided by the recipient and,
in the case of a notice contemplated by Section 2(b), in the place where the
relevant new account is to be located and (d) in relation to Section
5(a)(v)(2), in the relevant locations for performance with respect to such
Specified Transaction.
"Loss" means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency
Equivalent of an amount that party reasonably determines in good faith to be
its total losses and costs (or gain, in which case expressed as a negative
number) in connection with this Agreement or that Terminated Transaction or
group of Terminated Transactions, as the case may be, including any loss of
bargain, cost of funding, or at the election of such party but without
duplication, loss or cost incurred as a result of its terminating,
liquidating, obtaining or reestablishing any hedge or related trading position
(or any gain resulting from any of them). Loss includes losses and costs (or
gains) in respect of any payment or delivery required to have been made
(assuming satisfaction of each applicable condition precedent) on or before
the relevant Early Termination Date and not made, except, so as to avoid
duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does
not include a party's legal fees and out- of-pocket expenses referred to under
Section 11. A party will determine its Loss as of the relevant Early
Termination Date, or, if that is not reasonably practicable, as of the
earliest date thereafter as is reasonably practicable. A party may (but need
not) determine its Loss by reference to quotations of relevant rates or prices
from one or more leading dealers in the relevant markets.
"Market Quotation" means, with respect to one or more Terminated Transactions
and a party making the determination, an amount determined on the basis of
quotations from Reference Market-makers. Each quotation will be for an amount,
if any, that would be paid to such party (expressed as a negative number) or
by such party (expressed as a positive number) in consideration of an
agreement between such party (taking into account any existing Credit Support
Document with respect to the obligations of such party) and the quoting
Reference Market-maker to enter into a transaction (the "Replacement
Transaction") that would have the effect of preserving for such party the
economic equivalent of any payment or delivery (whether the underlying
obligation was absolute or contingent and assuming the satisfaction of each
applicable condition precedent) by the parties under Section 2(a)(i) in
respect of such Terminated Transaction or group of Terminated Transactions
that would, but for the occurrence of the relevant Early Termination Date,
have been required after that date. For this purpose, Unpaid Amounts in
respect of the Terminated Transaction or group of Terminated Transactions are
to be excluded but, without limitation, any payment or delivery that would,
but for the relevant Early Termination Date, have been required (assuming
satisfaction of each applicable condition precedent) after that Early
Termination Date is to be included. The Replacement Transaction would be
subject to such documentation as such party and the Reference Market-maker
may, in good faith, agree. The party making the determination (or its agent)
will request each Reference Market-maker to provide its quotation to the
extent reasonably practicable as of the same day and time (without regard to
different time zones) on or as soon as reasonably practicable after the
relevant Early Termination Date. The day and time as of which those quotations
are to be obtained will be selected in good faith by the party obliged to make
a determination under Section 6(e), and, if each party is obliged, after
consultation with the other. If more than three quotations are provided, the
Market Quotation will be the arithmetic mean of the quotations, without regard
to the quotations having the highest and lowest values. If exactly three such
quotations are provided, the Market Quotation will be the quotation remaining
after disregarding the highest and lowest quotations. For this purpose, if
more than one quotation has the same highest value or lowest value, then one
of such quotations shall he disregarded. If fewer than three quotations are
provided, it will be deemed that the Market Quotation in respect of such
Terminated Transaction or group of Terminated Transactions cannot be
determined.
"Non-default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it)
if it were to fund the relevant amount.
"Non-defaulting Party" has the meaning specified in Section 6(a).
"Office" means a branch or office of a party, which may be such party's head
or home office.
"Potential Event of Default" means any event which, with the giving of notice
or the lapse of time or both, would constitute an Event of Default.
"Reference Market-makers" means four leading dealers in the relevant market
selected by the party determining a Market Quotation in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria
that such party applies generally at the time in deciding whether to offer or
to make an extension of credit and (b) to the extent practicable, from among
such dealers having an office in the same city.
"Relevant Jurisdiction" means, with respect to a party, the jurisdictions (a)
in which the party is incorporated, organized, managed and controlled or
considered to have its seat, (b) where an Office through which the party is
acting for purposes of this Agreement is located, (c) in which the party
executes this Agreement and (d) in relation to any payment, from or through
which such payment is made.
"Scheduled Payment Date" means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.
"Set-off" means set-off, offset, combination of accounts, right of retention
or withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or
imposed on, such payer.
"Settlement Amount" means, with respect to a party and any Early Termination
Date, the sum of:--
(e) the Termination Currency Equivalent of the Market Quotations (whether
positive or negative) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation is determined; and
(f) such party's Loss (whether positive or negative and without reference to
any Unpaid Amounts) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation cannot be determined or would not
(in the reasonable belief of the party making the determination) produce a
commercially reasonable result.
"Specified Entity" has the meaning specified in the Schedule.
"Specified Indebtedness" means, subject to the Schedule, any obligation
(whether present or future, contingent or otherwise, as principal or surety or
otherwise) in respect of borrowed money.
"Specified Transaction" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter
entered into between one party to this Agreement (or any Credit Support
Provider of such party or any applicable Specified Entity of such party) and
the other party to this Agreement (or any Credit Support Provider of such
other party or any applicable Specified Entity of such other party) which is a
rate swap transaction, basic swap, forward rate transaction, commodity swap,
commodity option, equity or equity index swap, equity or equity index option,
bond option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, currency swap transaction,
cross-currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of these transactions),
(b) any combination of these transactions and (c) any other transaction
identified as a Specified Transaction in this Agreement or the relevant
confirmation.
"Stamp Tax" means any stamp, registration, documentation or similar tax.
"Tax" means any present or future tax, levy, impost, duty, charge, assessment
or fee of any nature (including interest, penalties and additions thereto)
that is imposed by any government or other taxing authority in respect of any
payment under this Agreement other than a stamp, registration, documentation
or similar tax.
"Tax Event" has the meaning specified in Section 5(b).
"Tax Event Upon Merger" has the meaning specified in Section 5(b).
"Terminated Transactions" means with respect to any Early Termination Date (a)
if resulting from a Termination Event, all Affected Transactions and (b) if
resulting from an Event of Default, all Transactions (in either case) in
effect immediately before the effectiveness of the notice designating that
Early Termination Date (or, if "Automatic Early Termination" applies,
immediately before that Early Termination Date).
"Termination Currency" has the meaning specified in the Schedule.
"Termination Currency Equivalent" means, in respect of any amount denominated
in the Termination Currency, such Termination Currency amount and, in respect
of any amount denominated in a currency other than the Termination Currency
(the "Other Currency"), the amount in the Termination Currency determined by'
the party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or,
if the relevant Market Quotation or Loss (as the case may be), is determined
as of a later date, that later date, with the Termination Currency at the rate
equal to the spot exchange rate of the foreign exchange agent (selected as
provided below) for the purchase of such Other Currency with the Termination
Currency at or about 11:00 am. (in the city in which such foreign exchange
agent is located) on such date as would be customary for the determination of
such a rate for the purchase of such Other Currency for value on the relevant
Early Termination Date or that later date. The foreign exchange agent will, if
only one party is obliged to make a determination under Section 6(e), be
selected in good faith by that party and otherwise will be agreed by the
parties.
"Termination Event" means an Illegality, a Tax Event or a Tax Event Upon
Merger or, if specified to be applicable, a Credit Event Upon Merger or an
Additional Termination Event.
"Termination Rate" means a rate per annum equal to the arithmetic mean of the
cost (without proof or evidence of any actual cost) to each party (as
certified by such party) if it were to fund or of funding such amounts.
"Unpaid Amounts" owing to any party means, with respect to an Early
Termination Date, the aggregate of (a) in respect of all Terminated
Transactions, the amounts that became payable (or that would have become
payable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or
prior to such Early Termination Date and which remain unpaid as at such Early
Termination Date and (b) in respect of each Terminated Transaction, for each
obligation under Section 2(a)(i) which was (or would have been but for Section
2(a)(iii) required to be settled by delivery to such party on or prior to such
Early Termination Date and which has not been so settled as at such Early
Termination Date, an amount equal to the fair market value of that which was
(or would have been) required to be delivered as of the originally scheduled
date for delivery, in each case together with (to the extent permitted under
applicable law) interest, in the currency of such amounts, from (and
including) the date such amounts or obligations were or would have been
required to have been paid or performed to (but excluding) such Early
Termination Date, at the Applicable Rate. Such amounts of interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed. The fair market value of any obligation referred to in clause (b)
above shall be reasonably determined by the party obliged to make the
determination under Section 6(e) or, if each party is so obliged, it shall be
the average of the Termination Currency. Equivalents of the fair market values
reasonably determined by both parties.
IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.
Xxxxxx Xxxxxxx Capital Services Inc. MMCA Auto Owner Trust 2002-5*
(Name of Party) (Name of Party)
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxxx X. Xxxxxxxx
Name: Xxxxxx Xxxxx Xxxxxx Name: Xxxxxxxx X. Xxxxxxxx
Title:Vice President Title: Financial Services Officer
Date: December 18, 2002 Date: December 18, 2002
* By: Wilmington Trust Company,
not in its individual capacity nor as a
principal to this Agreement, but
solely as Owner Trustee
Schedule - Page 18
SCHEDULE to the ISDA Master Agreement
Dated as of December 18, 2002
between
Xxxxxx Xxxxxxx CAPITAL SERVICES INC. ("MSCS")
and
MMCA AUTO OWNER TRUST 2002-5 (the "Trust")
Part 1 Termination Provisions.
(a) "Specified Entity" means:
(i) in relation to MSCS: Not Applicable.
(ii) in relation to the Trust: Not Applicable.
(b) "Specified Transaction" shall have the meaning specified in Section
14 of this Agreement.
(c) The "Breach of Agreement" provisions of Section 5(a)(ii) will not
apply to MSCS or to the Trust.
(d) The "Credit Support Default" provisions of Section 5(a)(iii), if
applicable, will apply to MSCS and will not apply to the Trust.
(e) The "Misrepresentation" provisions of Section 5(a)(iv) will not
apply to MSCS or to the Trust.
(f) The "Default under Specified Transaction" provisions of Section
5(a)(v) will not apply to MSCS or to the Trust.
(g) The "Cross Default" provisions of Section 5(a)(vi) will not apply
to MSCS or to the Trust.
(h) The "Merger Without Assumption" provisions of Section 5(a)(viii)
will apply to MSCS and will apply to the Trust.
(i) The "Tax Event" provision of Section 5(b)(ii) will apply to MSCS
and will not apply to the Trust, so that only the Trust may
designate an Early Termination Date in respect of such event.
(j) The "Tax Event Upon Merger" provision of Section 5(b)(iii) will
apply to MSCS and will not apply to the Trust, so that only the
Trust may designate an Early Termination Date in respect of such
event.
(k) The "Credit Event Upon Merger" provision in Section 5(b)(iv), will
not apply to MSCS or to the Trust.
(l) The "Automatic Early Termination" provision of Section 6(a) will
not apply to MSCS or to the Trust.
(m) Payments on Early Termination. For the purpose of Section 6(e) of
this Agreement:
(i) Market Quotation will apply unless the Trust is the
Non-defaulting Party or the party which is not the Affected
Party, as the case may be, and the Trust enters into a
replacement Transaction on or prior to the Early Termination
Date, in which event Loss will apply.
(ii) The Second Method will apply, provided, however, that
pursuant to Section 2.8(f) of the Indenture, any payments
payable by the Trust to MSCS hereunder in respect of the
Class A Notes will be pari passu and pro rata with payments
of interest made on the Class A Notes from Total Available
Funds, any payments payable by the Trust to MSCS hereunder
in respect of the Class B Notes will be pro rata with
payments of interest made on the Class B Notes from Total
Available Funds, and any payments payable by the Trust to
MSCS hereunder in respect of the Class C Notes will be pro
rata with payments of interest made on the Class C Notes
from Total Available Funds.
(n) "Termination Currency" means United States Dollars.
(o) "Additional Termination Event". The following shall constitute an
Additional Termination Event:
(i) Acceleration or Liquidation of the Notes. It shall be an
Additional Termination Event with the Trust the sole
Affected Party if MSCS or the Trust elects to terminate the
Transactions (1) following an Event of Default as defined in
Section 5.1(i) or Section 5.1(ii) of the Indenture which has
resulted in an acceleration of the Notes, provided such
acceleration has not been rescinded and annulled pursuant to
Section 5.2(b) of the Indenture, or (2) upon a liquidation
of the Trust Estate pursuant to Section 5.4(a)(iv) or
Section 5.4(b) of the Indenture. In such event, either MSCS
or the Trust may, by not more than 20 days notice to the
other party and provided such Additional Termination Event
is continuing, designate a day not earlier than the day such
notice is effective as an Early Termination Date in respect
of all Affected Transactions. If an event or circumstance
which would constitute an Event of Default by MSCS under
this Agreement gives rise to an Event of Default under the
Indenture, it will be treated as an Event of Default by MSCS
and not an Additional Termination Event.
(ii) Amendments Made Without Consent of MSCS. It shall be an
Additional Termination Event if any amendment or supplement
to the Indenture or to any of the Receivables Transfer and
Servicing Agreements which would materially adversely affect
any of MSCS' rights or obligations under this Agreement or
modify the obligations of, or impair the ability of the
Trust to fully perform any of the Trust's obligations under,
this Agreement is made without the consent of MSCS, which
consent shall not be unreasonably withheld (in which case
the Trust will be the Affected Party).
(iii) Downgrade of Xxxxxx Xxxxxxx. It shall be an Additional
Termination Event with MSCS the Affected Party if:
(1) the long-term Credit Rating of Xxxxxx Xxxxxxx from
Xxxxx'x is withdrawn, suspended or falls to (but on
credit watch with negative implications) or below
"Aa3," if Xxxxxx Xxxxxxx has a long-term rating only,
or the long-term Credit Rating of Xxxxxx Xxxxxxx from
Xxxxx'x is withdrawn, suspended or falls to (but on
credit watch with negative implications) or below
"A1" or the short-term Credit Rating of Xxxxxx
Xxxxxxx from Moody's, if so rated by Moody's, falls
to (but on credit watch with negative implications)
or below "Prime-1," and, within 30 days of such
suspension, withdrawal or downgrade MSCS shall fail
to (a) deliver or post collateral in accordance with
the Credit Support Annex, (b) assign its rights and
obligations under this Agreement to a replacement
counterparty that is a Swap Counterparty (as defined
in the Indenture) or (c) establish other arrangements
necessary (including, without limitation, causing an
entity with ratings such that if MSCS or its Credit
Support Provider had such ratings, this Additional
Termination Event would not have occurred, to
guarantee or provide an indemnity in respect of MSCS'
or its Credit Support Provider's obligations under
this Agreement in form and substance reasonably
satisfactory to Moody's), if any, for Moody's to
confirm in writing the ratings of the Notes that were
in effect immediately prior to such suspension,
withdrawal or downgrade; provided, however, that if
at any time after the date hereof (i) the long-term
Credit Rating of Xxxxxx Xxxxxxx from Xxxxx'x is
withdrawn, suspended or falls to or below "A2," if
Xxxxxx Xxxxxxx has a long-term rating only, or (ii)
the long-term Credit Rating of Xxxxxx Xxxxxxx from
Xxxxx'x is withdrawn, suspended or falls to or below
"A3" or the short-term Credit Rating of Xxxxxx
Xxxxxxx from Moody's, if so rated by Moody's, falls
to or below "Prime-2," MSCS shall be required to
assign its rights and obligations under this
Agreement and all Transactions hereunder at no cost
to the Trust to a party selected by the Trust (the
"Substitute Party") within 30 days following the
selection of a Substitute Party by the Trust;
provided, further, that such an assignment will not
comply with this provision unless (1) as of the date
of such transfer neither the Substitute Party nor the
Trust will be required to withhold or deduct on
account of any Tax from any payments under this
Agreement, (2) an Additional Termination Event or
Event of Default does not occur under this Agreement
as a result of such assignment, (3) the assignment
will not give rise to a taxable event or any other
adverse Tax consequences to the Trust or its interest
holders, (4) the Substitute Party is a Swap
Counterparty (as defined in the Indenture), (5) such
notice is accompanied by a written instrument
pursuant to which the Substitute Party acquires and
assumes the rights and obligations of MSCS so
assigned, and agrees that all other provisions of
this Agreement that do not constitute rights or
obligations shall (mutatis mutandis) apply to such
Substitute Party as if such Substitute Party were
MSCS hereunder, (6) MSCS will be responsible for any
Stamp Taxes and any reasonable costs or expenses
incurred by the Owner Trustee or the Trust in
connection with such assignment, (7) such assignment
satisfies the Rating Condition, and (8) payment has
been made to MSCS by the Substitute Party or by MSCS
to the Substitute Party (as applicable) of the
Substitution Assignment Amount, or such lesser or
greater amount as MSCS and such Substitute Party may
agree;
(2) the short-term Credit Rating of Xxxxxx Xxxxxxx is
downgraded below "A-1" by S&P, and Xxxxxx Xxxxxxx
shall fail to (a) use reasonable efforts to assign
(at its own cost or benefit) its rights and
obligations under this Agreement to a replacement
counterparty acceptable to the Trust and to S&P and
(b) if such an assignment has not occurred within 30
days of such downgrade, fail to deliver or post
collateral reasonably acceptable to the Trust and
sufficient to satisfy the Rating Agency Condition
with respect to S&P (as designated in an approved
Credit Support Annex) to secure its obligations under
this Agreement; provided, that notwithstanding the
posting of the collateral and the addition of the
Credit Support Annex, Xxxxxx Xxxxxxx shall continue
to use reasonable efforts to assign its rights and
obligations under this Agreement to a replacement
counterparty; or
(3) the long-term or the short-term Credit Rating of
Xxxxxx Xxxxxxx is suspended or withdrawn or
downgraded below "A" or "F1," respectively, by Fitch
Ratings and, within 30 days of such suspension,
withdrawal or downgrade MSCS shall fail to (a)
deliver or post collateral reasonably acceptable to
the Trust and acceptable to Fitch Ratings in amounts
sufficient or in accordance with the standards of
Fitch Ratings (as such standards may be modified
while any Transaction is still outstanding), to
secure its obligations under this Agreement, (b)
assign its rights and obligations under this
Agreement to a replacement counterparty reasonably
acceptable to the Trust and to Fitch Ratings or (c)
establish other arrangements necessary (including,
without limitation, causing an entity with ratings
such that if MSCS or its Credit Support Provider had
such ratings, this Additional Termination Event would
not have occurred, to guarantee or provide an
indemnity in respect of MSCS' or its Credit Support
Provider's obligations under this Agreement in form
and substance reasonably satisfactory to Fitch
Ratings), if any, in each case so that Fitch Ratings
confirms in writing the ratings of the Notes that
were in effect immediately prior to such suspension,
withdrawal or downgrade.
Part 2 Tax Representations.
(a) Payer Tax Representations. For the purposes of Section 3(e) of this
Agreement, MSCS and the Trust will each make the following
representations to the other:
It is not required by any applicable law, as modified by the
practice of any relevant governmental revenue authority, of any
Relevant Jurisdiction to make any deduction or withholding for or
on account of any Tax from any payment (other than interest under
Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be made by it
to the other party under this Agreement. In making this
representation, each party may rely on:
(i) the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement;
(ii) the satisfaction of the agreement of the other party
contained in Section 4(a)(i) or 4(a)(iii) of this Agreement
and the accuracy and effectiveness of any document provided
by the other party pursuant to Section 4(a)(i) or 4(a)(iii)
of this Agreement, and
(iii) the satisfaction of the agreement of the other party
contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where
reliance is placed on clause (ii) and the other party does not
deliver a form or document under Section 4(a)(iii) by reason of
material prejudice to its legal or commercial position.
(b) Payee Tax Representations.
(i) For the purpose of Section 3(f) of this Agreement, MSCS
represents to the Trust that it is a corporation organized
under the laws of the State of Delaware.
(ii) For the purpose of Section 3(f) of this Agreement, the Trust
represents to MSCS that it is a statutory trust organized
and existing under the laws of the State of Delaware.
(iii) MSCS represents that it is an exempt recipient under
Treasury Regulation Section 1.6049-4(c)(1)(ii), and the
Trust represents that it is wholly-owned by a "United States
person" and disregarded as an entity separate from its owner
for U.S. federal tax purposes.
Part 3 Documents to be delivered.
(a) For the purpose of Section 4(a)(i), the documents to be delivered are:
Party required to Form/Document/ Date by which to be Section 3(d)
deliver document Certificate delivered Representation
MSCS An executed United (i) Upon execution of this Applicable
States Internal Revenue Agreement, (ii) promptly
Service Form W-9 (or any upon reasonable demand
successor thereto). by the other party and
(iii) promptly upon
learning that any such
form previously provided
by such party has become
obsolete or incorrect.
(b) For the purposes of Section 4(a)(ii), the other documents to be delivered
are as follows:
Party required to Form/Document/ Date by which to be Section 3(d)
deliver document Certificate delivered Representation
MSCS and the Trust Evidence of the authority, Upon or prior to the execution and Applicable
incumbency and specimen delivery of this Agreement and,
signature of each person with respect to any Confirmation
executing this Agreement or upon request by the other party.
any Confirmation, Credit
Support Document or other
document entered into in
connection with this
Agreement on its behalf or on
behalf of a Credit Support
Provider or otherwise, as the
case may be.
The Trust Certified copies of documents As soon as practicable after the Applicable
evidencing each Party's execution of this Agreement.
capacity to execute and
deliver this Agreement, the
Confirmation and any Credit
Support Document (if
applicable), and to perform
its obligations hereunder or
thereunder as may be
reasonably requested by the
other party.
MSCS A copy of the annual report Promptly after request by the Trust. Applicable
of its Credit Support
Provider, including annual
audited financial statements
of its Credit Support
Provider prepared in
accordance with generally
accepted accounting
principles in the country in
which its Credit Support
Provider is organized.
The Trust Monthly reports to On or prior to each Payment Date. Applicable
noteholders and to holders of
the certificate (and all
other such notices required
to be given to noteholders
and to holders of the
certificate, as specified in
the Indenture).
MSCS and the Trust A legal opinion in form and On or prior to the Closing Date. Not Applicable
substance satisfactory to the
other party.
The Trust A copy of the executed As soon as practical after the Not Applicable
Indenture and of each of the Closing Date.
Receivables Transfer and
Servicing Agreements.
MSCS and the Trust Such other documents as the Promptly upon request of the other Not Applicable
other party may reasonably party.
request.
Part 4 Miscellaneous.
(a) Address for Notices. For the purpose of Section 12(a) of this
Agreement, the addresses for notices and communications to MSCS and
the Trust shall be as follows:
TO MSCS:
Xxxxxx Xxxxxxx Capital Services Inc.
0000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxx, Fixed Income Derivatives -
Transaction Management Manager
Tel: (000) 000-0000
Fax: (000) 000-0000
Xxxxxx Xxxxxxx
1221 Avenue of the Americas, 0xx Xxxxx
Xxxxx Xxxxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxx (Fixed Income Derivatives)
Tel: (000) 000-0000
Fax: (000) 000-0000
Xxxxxx Xxxxxxx Capital Services Inc.
0000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Fixed Income Derivatives -
Corporate Derivatives Group Manager
Tel: (000) 000-0000
Fax: (000) 000-0000
TO THE TRUST:
MMCA Auto Owner Trust 2002-5
c/o Wilmington Trust Company,
as Owner Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Tel: (000) 000-0000
Fax: (000) 000-0000
(b) Process Agent. For the purposes of Section 13(c) of this Agreement:
MSCS appoints as its Process Agent: Not Applicable
The Trust appoints as its Process Agent: Not Applicable
(c) Offices. The provisions of Section 10(a) will apply to this
Agreement.
(d) Multibranch Party. For purposes of Section 10(c) of this Agreement:
(i) MSCS is not a Multibranch Party.
(ii) The Trust is not a Multibranch Party.
(e) The Calculation Agent shall be MSCS.
(f) Credit Support Documents.
"Credit Support Document" means a credit support annex, if any, and
any other document which by its terms secures, guarantees or
otherwise supports either or both parties' obligations under this
Agreement, including, but not limited to, the guarantee of Xxxxxx
Xxxxxxx.
(g) Credit Support Provider.
Credit Support Provider means, in relation to MSCS, Xxxxxx Xxxxxxx.
Credit Support Provider means, in relation to the Trust, Not
Applicable.
(h) Governing Law. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the State of New York
(without reference to its choice of law doctrine) except that the
capacity, power or authority of the Trust to enter into this
Agreement and any issue relating to the interpretation of the
Trust's Trust Agreement will be governed and construed in
accordance with the laws of the State of
Delaware.
(i) "Affiliate" will have the meaning specified in Section 14 of this
Agreement, but as to the Trust, "Affiliate" will not include the
Owner Trustee, the Indenture Trustee or MMCA and as to MSCS,
"Affiliate" shall not include Xxxxxx Xxxxxxx Derivative Products
Inc.
Part 5 Other Provisions.
(a) Representations.
(i) Non-Reliance, Etc. Each party will be deemed to represent to
the other party on the date that it enters into a
Transaction that (absent a written agreement between the
parties that expressly imposes affirmative obligations to
the contrary for that Transaction):
(1) Non-Reliance. It is acting for its own account, and
it has made its own independent decisions to enter
into that Transaction and as to whether that
Transaction is appropriate or proper for it based
upon its own judgment and upon advice from such
advisers as it has deemed necessary. It is not
relying on any communication (written or oral) of the
other party as investment advice or as a
recommendation to enter into that Transaction; it
being understood that information and explanations
related to the terms and conditions of a Transaction
shall not be considered to be investment advice or a
recommendation to enter into that Transaction. No
communication (written or oral) received from the
other party shall be deemed to be an assurance or
guarantee as to the expected results of that
Transaction.
(2) Assessment and Understanding. It is capable of
assessing the merits of and understanding (on its own
behalf or through independent professional advice),
and understands and accepts the terms and conditions
and risks of that Transaction. It is also capable of
assuming, and assumes, the risks of that Transaction.
(3) Status of Parties. The other party is not acting as a
fiduciary for or adviser to it in respect of that
Transaction.
(ii) Commodity Exchange Act. Each party represents to the other
party on and as of the date hereof and on each date on which
a Transaction is entered into between them that:
(1) each Transaction is intended to be exempt from, or
otherwise not subject to regulation under, the
Commodity Exchange Act; and
(2) such party is an "eligible contract participant"
within the meaning of the United States Commodity
Exchange Act.
(b) Consent to Recording.
Each party consents to the recording of the telephone conversations
of trading and marketing and/or other personnel of the parties and
their Affiliates in connection with this Agreement.
(c) Section 3(a)(iii) is hereby amended by inserting the words "or
investment policies, guidelines, procedures or restrictions"
immediately following the word "documents".
(d) Tax Provisions.
(i) The definition of Tax Event, Section 5(b)(ii), is hereby
modified by adding the following provision at the end
thereof:
"provided, however, that for purposes of clarification,
the parties acknowledge that the introduction or proposal
of legislation shall not, in and of itself, give rise to
a presumption that a Tax Event has occurred."
(ii) The Trust will not be required to pay additional amounts
in respect of an Indemnifiable Tax or be under any
obligation to pay to MSCS any amount in respect of any
liability of MSCS for or on account of any Tax.
(e) No Set Off.
Notwithstanding any setoff right contained in any other agreement
between the Trust or any Affiliate or Credit Support Provider of
the Trust, on the one hand, and MSCS or any Affiliate or Credit
Support Provider of the Trust, on the other, whether now in
existence or hereafter entered into unless such agreement shall
specifically refer to this paragraph (e), each party agrees that
all payments required to be made by it under this Agreement shall
be made without setoff or counterclaim for, and that it shall not
withhold payment or delivery under this Agreement in respect of,
any default by the other party or any Affiliate or Credit Support
Provider of the other party under any such other agreement or any
amount relating to any such other agreement. For purposes of this
paragraph (e), "Affiliate" shall have the meaning specified in
Section 14 of this Agreement.
(f) Additional Acknowledgments and Agreements of the Parties.
(i) Financial Statements. Notwithstanding Section 5(a)(ii),
the failure of either party to deliver any financial
statement or monthly report referenced in Part 3 of this
Schedule shall not constitute an Event of Default under
Section 5(a)(ii).
(ii) Bankruptcy Code. Without limiting the applicability, if any,
of any other provision of the U.S. Bankruptcy Code as
amended (the "Bankruptcy Code") (including without
limitation Sections 362, 546, 556, and 560 thereof and the
applicable definitions in Section 101 thereof), the parties
acknowledge and agree that all Transactions entered into
hereunder will constitute "forward contracts" or "swap
agreements" as defined in Section 101 of the Bankruptcy Code
or "commodity contracts" as defined in Section 761 of the
Bankruptcy Code, that the rights of the parties under
Section 6 of this Agreement will constitute contractual
rights to liquidate Transactions, that any margin or
collateral provided under any margin, collateral, security,
pledge, or similar agreement related hereto will constitute
a "margin payment" as defined in Section 101 of the
Bankruptcy Code, and that the parties are entities entitled
to the rights under, and protections afforded by, Sections
362, 546, 556, and 560 of the Bankruptcy Code.
(iii) Regarding MSCS. MSCS represents that the description of MSCS
as set forth on page 47 of the Prospectus dated December 10,
2002 has been furnished and approved by MSCS and is true and
correct as of the date hereof.
(iv) Non-Petition. MSCS covenants and agrees that it will not,
prior to the date which is one year and one day following
the payment in full of all of the Notes and the Certificate
and the expiration of all applicable preference periods
under the United States Bankruptcy Code or other applicable
law relating to any such payment, acquiesce, petition or
otherwise invoke the process of any governmental or judicial
authority for the purpose of commencing a case (whether
voluntary or involuntary), cause any other person to
commence a case or join any other person in commencing a
case against the Trust under any bankruptcy, insolvency or
similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official
of the Trust or any substantial part of its property or
ordering the winding up or liquidation of the affairs of the
Trust. MSCS agrees that it has recourse against the Trust
only to the extent of the assets of the Trust and the
proceeds thereof, and any claims against the Trust shall be
extinguished when the assets of the Trust are exhausted.
(v) Transfer. Notwithstanding the provisions of Section 7, MSCS
may assign its rights and delegate its obligations under any
Transaction, in whole or in part, to any Affiliate of MSCS
(an "Assignee"), effective (the "Effective Transfer Date")
upon delivery to the Trust of both (a) an executed
acceptance and assumption by the Assignee of the transferred
obligations of MSCS under the Transaction(s) (the
"Transferred Obligations"); and (b) an executed guarantee of
Xxxxxx Xxxxxxx of the Transferred Obligations substantially
identical to the Credit Support Document with respect to
MSCS; provided that (x) no such transfer to an Assignee
shall occur if (i) the Trust shall, as a result of such
transfer, be required to pay to MSCS or the Assignee an
amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section
2(e), 6(d)(ii) or 6(e)) greater than the amount in respect
of which the Trust would have been required to pay to MSCS
in the absence of such transfer; (ii) MSCS or the Assignee
shall, as a result of such transfer, be required to withhold
or deduct on account of a Tax under Section 2(d)(i) (except
in respect of interest under Section 2(e), 6(d)(ii) or 6(e))
an amount in excess of that which MSCS would have been
required to withhold or deduct in the absence of such
transfer, unless the Assignee would be required to make
additional payments pursuant to Section 2(d)(i)(4)
corresponding to such excess; or (iii) an Event of Default,
Potential Event of Default or Termination Event would occur
hereunder as a result of such transfer; (y) MSCS shall pay
any fees and expenses incurred by or on the part of either
party as a result of such transfer; and (z) no such transfer
to an Assignee shall occur unless the Rating Agencies
confirm in writing that such transfer will not cause the
reduction, suspension or withdrawal of their then current
rating on any of the Notes.
On the Effective Transfer Date, (a) MSCS shall be
released from all obligations and liabilities arising
under the Transferred Obligations; and (b) the
Transferred Obligations shall cease to be Transaction(s)
under this Agreement and shall be deemed to be
Transaction(s) under the
ISDA Master Agreement between
the Assignee and the Trust, provided that, if, on the
Effective Transfer Date, the Assignee and the Trust have
not entered into an
ISDA Master Agreement, the Assignee
and the Trust shall be deemed to have entered into an
ISDA Master Agreement that is substantially identical to
this Agreement, including this Schedule. At least 10
Business Days prior to any such transfer MSCS shall
notify the Trust in writing of its intent to transfer its
rights and delegate its obligations hereunder in
accordance with the terms hereof, and shall state in
writing that such transfer shall conform to the
requirements of this Part 5(f)(v), whereupon the Trust
shall promptly notify each Rating Agency of such
transfer.
(vi) The Trust Pledge. Notwithstanding Section 7 of this
Agreement to the contrary, MSCS acknowledges that the Trust
will pledge its rights under this Agreement to the Indenture
Trustee (as defined in the Indenture) for the benefit of the
Noteholders (as defined in the Indenture) pursuant to the
Indenture and agrees to such pledge. The Indenture Trustee
shall not be deemed to be a party to this Agreement,
provided, however, that the Indenture Trustee, acting on
behalf of the holders of the Notes, shall have the right to
enforce this Agreement against MSCS. MSCS shall be entitled
to rely on any notice or communication from the Indenture
Trustee to that effect. MSCS acknowledges that the Trust
will pledge substantially all its assets to the Indenture
Trustee for the benefit of the Noteholders and MSCS and that
all payments hereunder, including payments on early
termination, will be made in accordance with the priority of
payment provisions of the Indenture and the Sale and
Servicing Agreement and on the Payment Dates specified
therein.
(vii) Limited Recourse. The liability of the Trust in relation to
this Agreement and any Transaction hereunder is limited in
recourse to the assets of the Trust and proceeds thereof
applied in accordance with the Indenture and the Sale and
Servicing Agreement. With respect to any amounts payable to
MSCS by the Trust under this Agreement, such amounts shall
be limited to the Total Available Funds as provided in and
subject to Section 2.8(a) of the Indenture. Upon exhaustion
of the assets of the Trust and proceeds thereof in
accordance with the Indenture and the Sale and Servicing
Agreement, MSCS shall not be entitled to take any further
steps against the Trust to recover any sums due but still
unpaid hereunder or thereunder, all claims in respect of
which shall be extinguished. No recourse may be taken for
the payment of any amount owing in respect of any obligation
of, or claim against, the Trust arising out of or based upon
this Agreement or any Transaction hereunder against any
holder of a beneficial interest, employee, officer or
Affiliate thereof and no recourse shall be taken for the
payment of any amount owing in respect of any obligation of,
or claim against, the Trust based upon or arising out of
this Agreement against the Administrator, the Seller, the
Servicer, the Indenture Trustee, the Owner Trustee or any
stockholder, holder of a beneficial interest, employee,
officer, director, incorporator or Affiliate thereof;
provided, however, that the foregoing shall not relieve any
such person or entity from any liability they might
otherwise have as a result of willful misconduct, bad faith
or negligence.
In furtherance of and not in derogation of the foregoing,
MSCS acknowledges and agrees that it shall have no right,
title or interest hereunder in or to the Other Assets of
the Seller. To the extent that, notwithstanding the
agreements and provisions contained in the preceding
paragraph, MSCS either (i) asserts hereunder an interest
or claim to, or benefit from, Other Assets, or (ii) is
deemed hereunder to have any such interest, claim to, or
benefit in or from Other Assets, whether by operation of
law, legal process, pursuant to applicable provisions of
insolvency laws or otherwise (including by virtue of
Section 1111(b) of the Bankruptcy Code or any successor
provision having similar effect under the Bankruptcy
Code), then MSCS further acknowledges and agrees that any
such interest, claim or benefit in or from Other Assets
is and shall be expressly subordinated to the
indefeasible payment in full, which, under the terms of
the relevant documents relating to the securitization or
conveyance of such Other Assets, are entitled to be paid
from, entitled to the benefits of, or otherwise secured
by such Other Assets (whether or not any such entitlement
or security interest is legally perfected or otherwise
entitled to a priority of distributions or application
under applicable law, including insolvency laws, and
whether or not asserted against the Seller), including
the payment of post-petition interest on such other
obligations and liabilities. This subordination agreement
shall be deemed a subordination agreement within the
meaning of Section 510(a) of the Bankruptcy Code. The
Trust further acknowledges and agrees that no adequate
remedy at law exists for a breach of this Part 5(f)(vii)
and the terms of this Part 5(f)(vii) may be enforced by
an action for specific performance. The provisions of
this Part 5(f)(vii) shall be for the third party benefit
of those entitled to rely thereon and shall survive the
termination of this Agreement.
(viii) No Amendment without Prior Confirmation by Rating Agencies.
Section 9(b) of this Agreement is hereby amended by adding
the following at the end of such Section: ", and unless the
Rating Agencies confirm in writing that such amendment will
not cause the reduction, suspension or withdrawal of their
then current rating on any of the Notes, unless such
amendment clarifies any term or provision, corrects any
inconsistency, cures any ambiguity, or corrects any
typographical error in the Agreement."
(ix) Consent by MSCS to Amendments to Certain Documents. Before
any amendment or supplement is made to the Receivables
Transfer and Servicing Agreements or to the Indenture which
would adversely affect any of MSCS' rights or obligations
under this Agreement or modify the obligations of, or impair
the ability of the Trust to fully perform any of the Trust's
obligations under, this Agreement, the Trust shall provide
MSCS with a copy of the proposed amendment or supplement and
shall obtain the consent of MSCS to such amendment or
supplement prior to its adoption, which consent shall not be
unreasonably withheld; provided that so long as a copy of
the proposed amendment or supplement has been delivered in
accordance with Section 12 of the Agreement to each of the
parties listed in Part 4(a) (Address for Notices) with
respect to MSCS and makes clear that MSCS has no longer than
10 Business Days to object to such amendment or supplement,
MSCS' consent will be deemed to have been given if MSCS does
not object in writing within 10 Business Days of receipt of
a written request for such consent.
(x) Severability. If any term, provision, covenant, or condition
of this Agreement, or the application thereof to any party
or circumstance, shall be held to be invalid or
unenforceable (in whole or in part) for any reason, the
remaining terms, provisions, covenants, and conditions
hereof shall continue in full force and effect as if this
Agreement had been executed with the invalid or
unenforceable portion eliminated, so long as this Agreement
as so modified continues to express, without material
change, the original intentions of the parties as to the
subject matter of this Agreement and the deletion of such
portion of this Agreement will not substantially impair the
respective benefits or expectations of the parties to this
Agreement; provided, however, that this severability
provision shall not be applicable if any provision of
Section 1, 2, 5, 6 or 13 (or any definition or provision in
Section 14 to the extent it relates to, or is used in
connection with, any such Section) shall be so held to be
invalid or unenforceable.
(g) Waiver of Right to Trial by Jury. Each of the parties hereby
irrevocably waives any and all right to a trial by jury with
respect to any legal proceeding arising out of or relating to this
Agreement or any Transaction.
(h) Limited Transactions. MSCS and the Trust each agrees and
acknowledges that the only Transactions that are or will be
governed by this Agreement are the Transactions evidenced by the
Confirmation dated the date hereof.
(i) Notices to Noteholders. The Trust shall provide MSCS with copies of
all notices required to be given to the holders of the Notes, and
upon request, shall provide MSCS with any other notices which could
be requested by the holders of the Notes.
(j) Further Representations of the Trust:
(i) The Class A Notes are rated "Aaa" by Xxxxx'x, "AAA" by S&P
and "AAA" by Fitch Ratings, the Class B Notes are rated
"Aa2" by Xxxxx'x, "AA" by S&P and "AA" by Fitch Ratings, and
the Class C Notes are rated "A2" by Xxxxx'x, "A" by S&P and
"A" by Fitch Ratings as to the timely payment of interest
and principal and without regard to third party credit
enhancement.
(ii) All conditions precedent to the issuance of the Notes under
the Indenture have been satisfied.
(iii) Each of the documents to which it is a party has been duly
authorized, executed and delivered by it.
(iv) Assuming the due authorization, execution and delivery
thereof by the other parties thereto, each of the Indenture
and the other documents to which the Trust is a party
constitutes the legal, valid and binding obligations of the
Trust, enforceable against the Trust in accordance with the
terms thereof, subject to applicable bankruptcy, insolvency
and similar laws or legal principles affecting creditors'
rights generally, and subject, as to enforceability, to
general principles of equity regardless of whether
enforcement is sought in a proceeding in equity or at law.
(v) The Indenture and the other documents to which the Trust is
a party are in full force and effect on the date hereof and
there have been no amendments or waivers or modifications of
any of the terms thereof since the original execution and
delivery of the Indenture and the other documents to which
the Trust is a party, except such as may have been delivered
to the Trust.
(vi) To the best of its knowledge no event of default or event
which would with the passage of time or the giving of notice
constitute an event of default has occurred and is
continuing under any of the documents to which the Trust is
a party.
(k) Immunity of Persons Related to the Trust. No representation or
agreement contained in this Agreement shall be deemed to be the
covenant or agreement of any trustee, officer, attorney, agent or
employee of the Trust, MMCA, any Affiliate thereof or any Credit
Support Provider thereof in an individual capacity.
(l) Limitation of Trustee's Liability. It is expressly understood and
agreed by the parties hereto that (a) this Agreement is executed
and delivered by Wilmington Trust Company, not individually nor as
a party to this Agreement, but solely as Owner Trustee of the
Trust, in the exercise of the powers and authority conferred and
vested in it, (b) the representations, undertakings and agreements
herein made on the part of the Trust are made and intended not as
personal representations, undertakings and agreements by Wilmington
Trust Company, but are made and intended for the purpose of binding
only the Trust, (c) nothing herein contained shall be construed as
creating any liability of Wilmington Trust Company, individually,
to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the
parties who are signatories to this Agreement and by any person
claiming by, through or under such parties and (d) under no
circumstances shall Wilmington Trust Company be personally liable
for the payment of any indebtedness of the Trust or expenses of
MSCS or the Trust or be liable for the breach or failure of any
obligation, representation, warranty or covenant, made or
undertaken by the Trust under this Agreement.
(m) Netting of Payments. Clause (ii) of Section 2(c) will not apply to
any amounts payable with respect to Transactions from the date of
this Agreement.
(n) Additional Swap Agreements. The Trust agrees that it will not enter
into additional swap agreements (other than any swap agreement in
replacement of any Transaction hereunder) without (i) the express
prior written consent of MSCS, which consent shall not be
unreasonably withheld and (ii) Rating Agency Confirmation.
(o) Notices. Section 12(a) is amended by adding in the third line
thereof after the phrase "messaging system" and before the ")" the
words, "; provided, however, any such notice or other communication
may be given by facsimile transmission if telex is unavailable, no
telex number is supplied to the party providing notice, or if
answer back confirmation is not received from the party to whom the
telex is sent."
(p) Additional Definitions.
"Administration Agreement" means the Administration
Agreement, dated as of December 1, 2002, as amended, supplemented
or otherwise modified and in effect, by and among the Trust, MMCA,
and Bank of Tokyo-Mitsubishi Trust Company.
"Administrator" shall have the meaning assigned thereto
in the Administration Agreement.
"Business Day" means any day other than a Saturday, a
Sunday or a day on which banking institutions or trust companies in
New York, New York, Wilmington,
Delaware or Los Angeles, California
are authorized or obligated by law, regulation or executive order
to remain closed.
"Certificate" means the Certificate issued by the Trust
pursuant to the Trust Agreement.
"Class A Notes" means the Class A-2 Notes, the Class A-3
and the Class A-4 Notes, collectively.
"Class A-2 Notes" means the Class A-2 Notes issued by the
Trust pursuant to the Indenture.
"Class A-3 Notes" means the Class A-3 Notes issued by the
Trust pursuant to the Indenture.
"Class A-4 Notes" means the Class A-4 Notes issued by the
Trust pursuant to the Indenture.
"Class B Notes" means the Class B Notes issued by the
Trust pursuant to the Indenture.
"Class C Notes" means the Class C Notes issued by the
Trust pursuant to the Indenture.
"Closing Date" means December 18, 2002.
"Credit Rating" means, with respect to MSCS, the issuer
rating of the head office of Xxxxxx Xxxxxxx without regard to
whether or not such rating is under review with positive or
negative implications.
"Fitch Ratings" means Fitch, Inc., doing business as
Fitch Ratings.
"Indenture" means the Indenture, dated as of December 1,
2002, as amended, supplemented or otherwise modified and in effect,
between the Trust and Bank of Tokyo-Mitsubishi Trust Company, as
Indenture Trustee.
"Indenture Trustee" means Bank of Tokyo-Mitsubishi Trust
Company, or any successor or replacement thereto pursuant to the
Indenture.
"MMCA" means Mitsubishi Motors Credit of America, Inc.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Notes" means the Class A-1 Notes, the Class A-2 Notes,
the Class A-3 Notes, the Class A-4 Notes, the Class B Notes and the
Class C Notes issued by the Trust pursuant to the Indenture.
"Other Assets" means any assets (or interests therein)
(other than the receivables and related property conveyed to the
Trust pursuant to the Sale and Servicing Agreement) conveyed or
purported to be conveyed by the Seller to another Person or Persons
other than MSCS, whether by way of a sale, capital contribution or
by virtue of the granting of a lien.
"Owner Trustee" means Wilmington Trust Company, a
Delaware Banking Corporation, not in its individual capacity nor as
a principal to this Agreement, but solely as Owner Trustee under
the Trust Agreement, its successors in interest and any successor
trustee under the Trust Agreement.
"Person" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company,
trust, unincorporated organization, or government or any agency or
political subdivision thereof.
"Payment Date" means the 15th day of each month or, if
such day is not a Business Day, the immediately following Business
Day, commencing January 15, 2003.
"Purchase Agreement" means the Purchase Agreement, dated
as of December 1, 2002, as from time to time amended, supplemented
or otherwise modified and in effect, between MMCA and MMCA Auto
Receivables Trust II.
"Rating Agencies" means Moody's, S&P or Fitch Ratings, or
any substitute rating agency that the Seller (as defined in the
Indenture) requests to rate the Notes.
"Rating Agency Confirmation" means, with respect to any
action, that each Rating Agency shall have been given prior written
notice thereof and that each of the Rating Agencies shall have
notified the Seller, the Servicer, the Indenture Trustee and the
Owner Trustee in writing that such action shall not result in a
reduction or withdrawal of the then current rating assigned to any
Class of Notes.
"Receivables Transfer and Servicing Agreements" means,
collectively, the Purchase Agreement, the Sale and Servicing
Agreement, the Trust Agreement and the Administration Agreement.
"S&P" means Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc.
"Sale and Servicing Agreement" means the Sale and
Servicing Agreement, dated as of December 1, 2002, as amended,
supplemented or otherwise modified and in effect, by and among the
Trust, MMCA Auto Receivables Trust II, as seller, and MMCA, as
servicer.
"Seller" means MMCA Auto Receivables Trust II.
"Servicer" means MMCA, in its capacity as Servicer under
the Sale and Servicing Agreement and each successor thereto
appointed and acting pursuant to the Sale and Servicing Agreement.
"Substitution Assignment Amount" shall be calculated in
accordance with the Market Quotation method as if the date of
determination were an Early Termination Date for which all
Transactions were Affected Transactions and the Trust were the sole
Affected Party; provided, however, that for purposes of Part 1(o),
Market Quotation shall mean, in the event that fewer than three
quotations are provided, the average of the quotations provided.
"Total Available Funds" has the meaning as set forth in
the Sale and Servicing Agreement.
"Trust Agreement" means the Amended and Restated Trust
Agreement, dated as of December 1, 2002, as amended, supplemented
or otherwise modified and in effect, by and among MMCA Auto
Receivables Trust II, as depositor, and Wilmington Trust Company,
as owner trustee.
"Trust Estate" means all money, instruments, rights and
other property that are subject or intended to be subject to the
lien and security interest of the Indenture for the benefit of the
Noteholders and the Swap Counterparties (including, without
limitation, all property and interests granted to the Indenture
Trustee), including all proceeds thereof.
IN WITNESS WHEREOF, the parties have executed this
Schedule to the Master Agreement on the respective dates specified below with
effect from the date specified on the first page of this document.
XXXXXX XXXXXXX CAPITAL MMCA AUTO OWNER TRUST 2002-5
SERVICES INC.
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
nor as a principal to this
Agreement, but solely as Owner
Trustee
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxxx X. Xxxxxxxx
----------------------------- ------------------------------------
Name: Xxxxxx Xxxxx Xxxxxx Name: Xxxxxxxx X. Xxxxxxxx
Title: Vice President Title: Financial Services Officer
(Bilateral Form) (ISDA Agreements Subject to New York Law Only)
ISDA(R)
International Swaps and Derivatives Association, Inc.
CREDIT SUPPORT ANNEX
to the Schedule to the
ISDA MASTER AGREEMENT
dated as of December 18, 2002
between
XXXXXX XXXXXXX CAPITAL SERVICES INC. ("MSCS")
and
MMCA AUTO OWNER TRUST 2002-5 (the "Trust")
This Annex supplements, forms part of, and is subject to, the above-referenced
Agreement, is part of its Schedule and is a Credit Support Document under this
Agreement with respect to each party.
Accordingly, the parties agree as follows:--
Paragraph 1. Interpretation
(a) Definitions and Inconsistency. Capitalized terms not otherwise defined
herein or elsewhere in this Agreement have the meanings specified pursuant to
Paragraph 12, and all references in this Annex to Paragraphs are to Paragraphs
of this Annex. In the event of any inconsistency between this Annex and the
other provisions of this Schedule, this Annex will prevail, and in the event
of any inconsistency between Paragraph 13 and the other provisions of this
Annex, Paragraph 13 will prevail.
(b) Secured Party and Pledgor. All references in this Annex to the "Secured
Party" will be to either party when acting in that capacity and all
corresponding references to the "Pledgor" will be to the other party when
acting in that capacity; provided, however, that if Other Posted Support is
held by a party to this Annex, all references herein to that party as the
Secured Party with respect to that Other Posted Support will be to that party
as the beneficiary thereof and will not subject that support or that party as
the beneficiary thereof to provisions of law generally relating to security
interests and secured parties.
Paragraph 2. Security Interest
Each party, as the Pledgor, hereby pledges to the other party, as the Secured
Party, as security for its Obligations, and grants to the Secured Party a
first priority continuing security interest in, lien on and right of Set-off
against all Posted Collateral Transferred to or received by the Secured Party
hereunder. Upon the Transfer by the Secured Party to the Pledgor of Posted
Collateral, the security interest and lien granted hereunder on that Posted
Collateral will be released immediately and, to the extent possible, without
any further action by either party.
Paragraph 3. Credit Support Obligations
(a) Delivery Amount. Subject to Paragraphs 4 and 5, upon a demand made by the
Secured Party on or promptly following a Valuation Date, if the Delivery
Amount for that Valuation Date equals or exceeds the Pledgor's Minimum
Transfer Amount, then the Pledgor will Transfer to the Secured Party Eligible
Credit Support having a Value as of the date of Transfer at least equal to the
applicable Delivery Amount (rounded pursuant to Paragraph 13). Unless
otherwise specified in Paragraph 13, the "Delivery Amount" applicable to the
Pledgor for any Valuation Date will equal the amount by which:
(i) the Credit Support Amount
exceeds
(ii) the Value as of that Valuation Date of all Posted Credit Support held
by the Secured Party.
(b) Return Amount. Subject to Paragraphs 4 and 5, upon a demand made by the
Pledgor on or promptly following a Valuation Date, if the Return Amount for
that Valuation Date equals or exceeds the Secured Party's Minimum Transfer
Amount, then the Secured Party will Transfer to the Pledgor Posted Credit
Support specified by the Pledgor in that demand having a Value as of the date
of Transfer as close as practicable to the applicable Return Amount (rounded
pursuant to Paragraph 13). Unless otherwise specified in Paragraph 13, the
"Return Amount" applicable to the Secured Party for any Valuation Date will
equal the amount by which:
(i) the Value as of that Valuation Date of all Posted Credit Support held
by the Secured Party
exceeds
(ii) the Credit Support Amount.
"Credit Support Amount" means, unless otherwise specified in Paragraph 13, for
any Valuation Date (i) the Secured Party's Exposure for that Valuation Date
plus (ii) the aggregate of all Independent Amounts applicable to the Pledgor,
if any, minus (iii) all Independent Amounts applicable to the Secured Party,
if any, minus (iv) the Pledgor's Threshold; provided, however, that the Credit
Support Amount will be deemed to be zero whenever the calculation of Credit
Support Amount yields a number less than zero.
Paragraph 4. Conditions Precedent, Transfer Timing, Calculations and
Substitutions
(a) Conditions Precedent. Each Transfer obligation of the Pledgor under
Paragraphs 3 and 5 and of the Secured Party under Paragraphs 3, 4(d)(ii), 5
and 6(d) is subject to the conditions precedent that:
(i) no Event of Default, Potential Event of Default or Specified
Condition has occurred and is continuing with respect to the other
party; and
(ii) no Early Termination Date for which any unsatisfied payment
obligations exist has occurred or been designated as the result of an
Event of Default or Specified Condition with respect to the other
party.
(b) Transfer Timing. Subject to Paragraphs 4(a) and 5 and unless otherwise
specified, if a demand for the Transfer of Eligible Credit Support or Posted
Credit Support is made by the Notification Time, then the relevant Transfer
will be made not later than the close of business on the next Local Business
Day; if a demand is made after the Notification Time, then the relevant
Transfer will be made not later than the close of business on the second Local
Business Day thereafter.
(c) Calculations. All calculations of Value and Exposure for purposes of
Paragraphs 3 and 6(d) will be made by the Valuation Agent as of the Valuation
Time. The Valuation Agent will notify each party (or the other party, if the
Valuation Agent is a party) of its calculations not later than the
Notification Time on the Local Business Day following the applicable Valuation
Date (or in the case of Paragraph 6(d), following the date of calculation).
(d) Substitutions.
(i) Unless otherwise specified in Paragraph 13, upon notice to the
Secured Party specifying the items of Posted Credit Support to be
exchanged, the Pledgor may, on any Local Business Day, Transfer to
the Secured Party substitute Eligible Credit Support (the "Substitute
Credit Support"); and
(ii) subject to Paragraph 4(a), the Secured Party will Transfer to the
Pledgor the items of Posted Credit Support specified by the Pledgor
in its notice not later than the Local Business Day following the
date on which the Secured Party receives the Substitute Credit
Support, unless otherwise specified in Paragraph 13 (the
"Substitution Date"); provided that the Secured Party will only be
obligated to Transfer Posted Credit Support with a Value as of the
date of Transfer of that Posted Credit Support equal to the Value as
of that date of the Substitute Credit Support.
Paragraph 5. Dispute Resolution
If a party (a "Disputing Party") disputes (I) the Valuation Agent's
calculation of a Delivery Amount or a Return Amount or (II) the Value of any
Transfer of Eligible Credit Support or Posted Credit Support, then (1) the
Disputing Party will notify the other party and the Valuation Agent (if the
Valuation Agent is not the other party) not later than the close of business
on the Local Business Day following (X) the date that the demand is made under
Paragraph 3 in the case of (I) above or (Y) the date of Transfer in the case
of (II) above, (2) subject to Paragraph 4(a), the appropriate party will
Transfer the undisputed amount to the other party not later than the close of
business on the Local Business Day following (X) the date that the demand is
made under Paragraph 3 in the case of (I) above or (Y) the date of Transfer in
the case of (II) above, (3) the parties will consult with each other in an
attempt to resolve the dispute and (4) if they fail to resolve the dispute by
the Resolution Time, then:
(i) In the case of a dispute involving a Delivery Amount or Return
Amount, unless otherwise specified in Paragraph 13, the Valuation
Agent will recalculate the Exposure and the Value as of the
Recalculation Date by:
(A) utilizing any calculations of Exposure for the Transactions (or
Swap Transactions) that the parties have agreed are not in
dispute;
(B) calculating the Exposure for the Transactions (or Swap
Transactions) in dispute by seeking four actual quotations at
mid-market from Reference Market-makers for purposes of
calculating Market Quotation, and taking the arithmetic average
of those obtained; provided that if four quotations are not
available for a particular Transaction (or Swap Transaction),
then fewer than four quotations may be used for that Transaction
(or Swap Transaction); and if no quotations are available for a
particular Transaction (or Swap Transaction), then the Valuation
Agent's original calculations will be used for that Transaction
(or Swap Transaction); and
(C) utilizing the procedures specified in Paragraph 13 for
calculating the Value, if disputed, of Posted Credit Support.
(ii) In the case of a dispute involving the Value of any Transfer of
Eligible Credit Support or Posted Credit Support, the Valuation Agent
will recalculate the Value as of the date of Transfer pursuant to
Paragraph 13.
Following a recalculation pursuant to this Paragraph, the Valuation Agent will
notify each party (or the other party, if the Valuation Agent is a party) not
later than the Notification Time on the Local Business Day following the
Resolution Time. The appropriate party will, upon demand following that notice
by the Valuation Agent or a resolution pursuant to (3) above and subject to
Paragraphs 4(a) and 4(b), make the appropriate Transfer.
Paragraph 6. Holding and Using Posted Collateral
(a) Care of Posted Collateral. Without limiting the Secured Party's rights
under Paragraph 6(c), the Secured Party will exercise reasonable care to
assure the safe custody of all Posted Collateral to the extent required by
applicable law, and in any event the Secured Party will be deemed to have
exercised reasonable care if it exercises at least the same degree of care as
it would exercise with respect to its own property. Except as specified in the
preceding sentence, the Secured Party will have no duty with respect to Posted
Collateral, including, without limitation, any duty to collect any
Distributions, or enforce or preserve any rights pertaining thereto.
(b) Eligibility to Hold Posted Collateral; Custodians.
(i) General. Subject to the satisfaction of any conditions specified in
Paragraph 13 for holding Posted Collateral, the Secured Party will be
entitled to hold Posted Collateral or to appoint an agent (a
"Custodian") to hold Posted Collateral for the Secured Party. Upon
notice by the Secured Party to the Pledgor of the appointment of a
Custodian, the Pledgor's obligations to make any Transfer will be
discharged by making the Transfer to that Custodian. The holding of
Posted Collateral by a Custodian will be deemed to be the holding of
that Posted Collateral by the Secured Party for which the Custodian
is acting.
(ii) Failure to Satisfy Conditions. If the Secured Party or its Custodian
fails to satisfy any conditions for holding Posted Collateral, then
upon a demand made by the Pledgor, the Secured Party will, not later
than five Local Business Days after the demand, Transfer or cause its
Custodian to Transfer all Posted Collateral held by it to a Custodian
that satisfies those conditions or to the Secured Party if it
satisfies those conditions.
(iii) Liability. The Secured Party will be liable for the acts or
omissions of its Custodian to the same extent that the Secured Party
would be liable hereunder for its own acts or omissions.
(c) Use of Posted Collateral. Unless otherwise specified in Paragraph 13 and
without limiting the rights and obligations of the parties under Paragraphs 3,
4(d)(ii), 5, 6(d) and 8, if the Secured Party is not a Defaulting Party or an
Affected Party with respect to a Specified Condition and no Early Termination
Date has occurred or been designated as the result of an Event of Default or
Specified Condition with respect to the Secured Party, then the Secured Party
will, notwithstanding Section 9-207 of the New York Uniform Commercial Code,
have the right to:
(i) sell, pledge, rehypothecate, assign, invest, use, commingle or
otherwise dispose of, or otherwise use in its business any Posted
Collateral it holds, free from any claim or right of any nature
whatsoever of the Pledgor, including any equity or right of
redemption by the Pledgor; and
(ii) register any Posted Collateral in the name of the Secured Party, its
Custodian or a nominee for either.
For purposes of the obligation to Transfer Eligible Credit Support or Posted
Credit Support pursuant to Paragraphs 3 and 5 and any rights or remedies
authorized under this Agreement, the Secured Party will be deemed to continue
to hold all Posted Collateral and to receive Distributions made thereon,
regardless of whether the Secured Party has exercised any rights with respect
to any Posted Collateral pursuant to (i) or (ii) above.
(d) Distributions and Interest Amount
(i) Distributions. Subject to Paragraph 4(a), if the Secured Party
receives or is deemed to receive Distributions on a Local Business
Day, it will Transfer to the Pledgor not later than the following
Local Business Day any Distributions it receives or is deemed to
receive to the extent that a Delivery Amount would not be created or
increased by that Transfer, as calculated by the Valuation Agent (and
the date of calculation will be deemed to be a Valuation Date for
this purpose).
(ii) Interest Amount. Unless otherwise specified in Paragraph 13 and
subject to Paragraph 4(a), in lieu of any interest, dividends or
other amounts paid or deemed to have been paid with respect to Posted
Collateral in the form of Cash (all of which may be retained by the
Secured Party), the Secured Party will Transfer to the Pledgor at the
times specified in Paragraph 13 the Interest Amount to the extent
that a Delivery Amount would not be created or increased by that
Transfer, as calculated by the Valuation Agent (and the date of
calculation will be deemed to be a Valuation Date for this purpose).
The Interest Amount or portion thereof not Transferred pursuant to
this Paragraph will constitute Posted Collateral in the form of Cash
and will be subject to the security interest granted under Paragraph
2.
Paragraph 7. Events of Default
For purposes of Section 5(a)(iii)(1) of this Agreement, an Event of Default
will exist with respect to a party if:
(i) that party fails (or fails to cause its Custodian) to make, when due,
any Transfer of Eligible Collateral, Posted Collateral or the
Interest Amount, as applicable, required to be made by it and that
failure continues for two Local Business Days after notice of that
failure is given to that party;
(ii) that party fails to comply with any restriction or prohibition
specified in this Annex with respect to any of the rights specified
in Paragraph 6(c) and that failure continues for five Local Business
Days after notice of that failure is given to that party; or
(iii) that party fails to comply with or perform any agreement or
obligation other than those specified in Paragraphs 7(i) and 7(ii)
and that failure continues for 30 days after notice of that failure
is given to that party.
Paragraph 8. Certain Rights and Remedies
(a) Secured Party's Rights and Remedies. If at any time (1) an Event of
Default or Specified Condition with respect to the Pledgor has occurred and is
continuing or (2) an Early Termination Date has occurred or been designated as
the result of an Event of Default or Specified Condition with respect to the
Pledgor, then, unless the Pledgor has paid in full all of its Obligations that
are then due, the Secured Party may exercise one or more of the following
rights and remedies:
(i) all rights and remedies available to a secured party under applicable
law with respect to Posted Collateral held by the Secured Party;
(ii) any other rights and remedies available to the Secured Party under
the terms of Other Posted Support, if any;
(iii) the right to Set-off any amounts payable by the Pledgor with respect
to any Obligations against any Posted Collateral or the Cash
equivalent of any Posted Collateral held by the Secured Party (or any
obligation of the Secured Party to Transfer that Posted Collateral);
and
(iv) the right to liquidate any Posted Collateral held by the Secured
Party through one or more public or private sales or other
dispositions with such notice, if any, as may be required under
applicable law, free from any claim or right of any nature whatsoever
of the Pledgor, including any equity or right of redemption by the
Pledgor (with the Secured Party having the right to purchase any or
all of the Posted Collateral to be sold) and to apply the proceeds
(or the Cash equivalent thereof) from the liquidation of the Posted
Collateral to any amounts payable by the Pledgor with respect to any
Obligations in that order as the Secured Party may elect.
Each party acknowledges and agrees that Posted Collateral in the form of
securities may decline speedily in value and is of a type customarily sold on
a recognized market, and, accordingly, the Pledgor is not entitled to prior
notice of any sale of that Posted Collateral by the Secured Party, except any
notice that is required under applicable law and cannot be waived.
(b) Pledgor's Rights and Remedies. If at any time an Early Termination Date
has occurred or been designated as the result of an Event of Default or
Specified Condition with respect to the Secured Party, then (except in the
case of an Early Termination Date relating to less than all Transactions (or
Swap Transactions) where the Secured Party has paid in full all of its
obligations that are then due under Section 6(e) of this Agreement):
(i) the Pledgor may exercise all rights and remedies available to a
pledgor under applicable law with respect to Posted Collateral held
by the Secured
Party;
(ii) the Pledgor may exercise any other rights and remedies available to
the Pledgor under the terms of Other Posted Support, if any;
(iii) the Secured Party will be obligated immediately to Transfer all
Posted Collateral and the Interest Amount to the Pledgor; and
(iv) to the extent that Posted Collateral or the Interest Amount is not so
Transferred pursuant to (iii) above, the Pledgor may:
(A) Set-off any amounts payable by the Pledgor with respect to any
Obligations against any Posted Collateral or the Cash equivalent
of any Posted Collateral held by the Secured Party (or any
obligation of the Secured Party to Transfer that Posted
Collateral); and
(B) to the extent that the Pledgor does not Set-off under (iv)(A)
above, withhold payment of any remaining amounts payable by the
Pledgor with respect to any Obligations, up to the Value of any
remaining Posted Collateral held by the Secured Party, until
that Posted Collateral is Transferred to the Pledgor.
(c) Deficiencies and Excess Proceeds. The Secured Party will Transfer to the
Pledgor any proceeds and Posted Credit Support remaining after liquidation,
Set-off and/or application under Paragraphs 8(a) and 8(b) after satisfaction
in full of all amounts payable by the Pledgor with respect to any Obligations;
the Pledgor in all events will remain liable for any amounts remaining unpaid
after any liquidation, Set-off and/or application under Paragraphs 8(a) and
8(b).
(d) Final Returns. When no amounts are or thereafter may become payable by the
Pledgor with respect to any Obligations (except for any potential liability
under Section 2(d) of this Agreement), the Secured Party will Transfer to the
Pledgor all Posted Credit Support and the Interest Amount, if any.
Paragraph 9. Representations
Each party represents to the other party (which representations will be deemed
to be repeated as of each date on which it, as the Pledgor, Transfers Eligible
Collateral) that:
(i) it has the power to grant a security interest in and lien on any
Eligible Collateral it Transfers as the Pledgor and has taken all
necessary actions to authorize the granting of that security interest
and lien;
(ii) it is the sole owner of or otherwise has the right to Transfer all
Eligible Collateral it Transfers to the Secured Party hereunder, free
and clear of any security interest, lien, encumbrance or other
restrictions other than the security interest and lien granted under
Paragraph 2;
(iii) upon the Transfer of any Eligible Collateral to the Secured Party
under the terms of this Annex, the Secured Party will have a valid
and perfected first priority security interest therein (assuming that
any central clearing corporation or any third-party financial
intermediary or other entity not within the control of the Pledgor
involved in the Transfer of that Eligible Collateral gives the
notices and takes the action required of it under applicable law for
perfection of that interest); and
(iv) the performance by it of its obligations under this Annex will not
result in the creation of any security interest, lien or other
encumbrance on any Posted Collateral other than the security interest
and lien granted under Paragraph 2.
Paragraph 10. Expenses
(a) General. Except as otherwise provided in Paragraphs 10(b) and 10(c), each
party will pay its own costs and expenses in connection with performing its
obligations under this Annex and neither party will be liable for any costs
and expenses incurred by the other party in connection herewith.
(b) Posted Credit Support. The Pledgor will promptly pay when due all taxes,
assessments or charges of any nature that are imposed with respect to Posted
Credit Support held by the Secured Party upon becoming aware of the same,
regardless of whether any portion of that Posted Credit Support is
subsequently disposed of under Paragraph 6(c), except for those taxes,
assessments and charges that result from the exercise of the Secured Party's
rights under Paragraph 6(c).
(c) Liquidation/Application of Posted Credit Support. All reasonable costs and
expenses incurred by or on behalf of the Secured Party or the Pledgor in
connection with the liquidation and/or application of any Posted Credit
Support under Paragraph 8 will be payable, on demand and pursuant to the
Expenses Section of this Agreement, by the Defaulting Party or, if there is no
Defaulting Party, equally by the parties.
Paragraph 11. Miscellaneous
(a) Default Interest. A Secured Party that fails to make, when due, any
Transfer of Posted Collateral or the Interest Amount will be obligated to pay
the Pledgor (to the extent permitted under applicable law) an amount equal to
interest at the Default Rate multiplied by the Value of the items of property
that were required to be Transferred, from (and including) the date that
Posted Collateral or Interest Amount was required to be Transferred to (but
excluding) the date of Transfer of that Posted Collateral or Interest Amount.
This interest will be calculated on the basis of daily compounding and the
actual number of days elapsed.
(b) Further Assurances. Promptly following a demand made by a party, the other
party will execute, deliver, file and record any financing statement, specific
assignment or other document and take any other action that may be necessary
or desirable and reasonably requested by that party to create, preserve,
perfect or validate any security interest or lien granted under Paragraph 2,
to enable that party to exercise or enforce its rights under this Annex with
respect to Posted Credit Support or an Interest Amount or to effect or
document a release of a security interest on Posted Collateral or an Interest
Amount.
(c) Further Protection. The Pledgor will promptly give notice to the Secured
Party of, and defend against, any suit, action, proceeding or lien that
involves Posted Credit Support Transferred by the Pledgor or that could
adversely affect the security interest and lien granted by it under Paragraph
2, unless that suit, action, proceeding or lien results from the exercise of
the Secured Party's rights under Paragraph 6(c).
(d) Good Faith and Commercially Reasonable Manner. Performance of all
obligations under this Annex, including, but not limited to, all calculations,
valuations and determinations made by either party, will be made in good faith
and in a commercially reasonable manner.
(e) Demands and Notices. All demands and notices made by a party under this
Annex will be made as specified in the Notices Section of this Agreement,
except as otherwise provided in Paragraph 13.
(f) Specifications of Certain Matters. Anything referred to in this Annex as
being specified in Paragraph 13 also may be specified in one or more
Confirmations or other documents and this Annex will be construed accordingly.
Paragraph 12. Definitions
As used in this Annex:--
"Cash" means the lawful currency of the United States of America.
"Credit Support Amount" has the meaning specified in Paragraph 3.
"Custodian" has the meaning specified in Paragraphs 6(b)(i) and 13.
"Delivery Amount" has the meaning specified in Paragraph 3(a).
"Disputing Party" has the meaning specified in Paragraph 5.
"Distributions" means with respect to Posted Collateral other than Cash, all
principal, interest and other payments and distributions of cash or other
property with respect thereto, regardless of whether the Secured Party has
disposed of that Posted Collateral under Paragraph 6(c). Distributions will
not include any item of property acquired by the Secured Party upon any
disposition or liquidation of Posted Collateral or, with respect to any Posted
Collateral in the form of Cash, any distributions on that collateral, unless
otherwise specified herein.
"Eligible Collateral" means, with respect to a party, the items, if any,
specified as such for that party in Paragraph 13.
"Eligible Credit Support" means Eligible Collateral and Other Eligible Support.
"Exposure" means for any Valuation Date or other date for which Exposure is
calculated and subject to Paragraph 5 in the case of a dispute, the amount, if
any, that would be payable to a party that is the Secured Party by the other
party (expressed as a positive number) or by a party that is the Secured Party
to the other party (expressed as a negative number) pursuant to Section
6(e)(ii)(2)(A) of this Agreement as if all Transactions (or Swap Transactions)
were being terminated as of the relevant Valuation Time; provided that Market
Quotation will be determined by the Valuation Agent using its estimates at
mid-market of the amounts that would be paid for Replacement Transactions (as
that term is defined in the definition of "Market Quotation").
"Independent Amount" means, with respect to a party, the amount specified as
such for that party in Paragraph 13; if no amount is specified, zero.
"Interest Amount" means, with respect to an Interest Period, the aggregate sum
of the amounts of interest calculated for each day in that Interest Period on
the principal amount of Posted Collateral in the form of Cash held by the
Secured Party on that day, determined by the Secured Party for each such day
as follows:
(x) the amount of that Cash on that day; multiplied by
(y) the Interest Rate in effect for that day; divided by
(z) 360.
"Interest Period" means the period from (and including) the last Local
Business Day on which an Interest Amount was Transferred (or, if no Interest
Amount has yet been Transferred, the Local Business Day on which Posted
Collateral in the form of Cash was Transferred to or received by the Secured
Party) to (but excluding) the Local Business Day on which the current Interest
Amount is to be Transferred.
"Interest Rate" means the rate specified in Paragraph 13.
"Local Business Day," unless otherwise specified in Paragraph 13, has the
meaning specified in the Definitions Section of this Agreement, except that
references to a payment in clause (b) thereof will be deemed to include a
Transfer under this Annex.
"Minimum Transfer Amount" means, with respect to a party, the amount specified
as such for that party in Paragraph 13; if no amount is specified, zero.
"Notification Time" has the meaning specified in Paragraph 13.
"Obligations" means, with respect to a party, all present and future
obligations of that party under this Agreement and any additional obligations
specified for that party in Paragraph 13.
"Other Eligible Support" means, with respect to a party, the items, if any,
specified as such for that party in Paragraph 13.
"Other Posted Support" means all Other Eligible Support Transferred to the
Secured Party that remains in effect for the benefit of that Secured Party.
"Pledgor" means either party, when that party (i) receives a demand for or is
required to Transfer Eligible Credit Support under Paragraph 3(a) or (ii) has
Transferred Eligible Credit Support under Paragraph 3(a).
"Posted Collateral" means all Eligible Collateral, other property,
Distributions, and all proceeds thereof that have been Transferred to or
received by the Secured Party under this Annex and not Transferred to the
Pledgor pursuant to Paragraph 3(b), 4(d)(ii) or 6(d)(i) or released by the
Secured Party under Paragraph 8. Any Interest Amount or portion thereof not
Transferred pursuant to Paragraph 6(d)(ii) will constitute Posted Collateral
in the form of Cash.
"Posted Credit Support" means Posted Collateral and Other Posted Support.
"Recalculation Date" means the Valuation Date that gives rise to the dispute
under Paragraph 5; provided, however, that if a subsequent Valuation Date
occurs under Paragraph 3 prior to the resolution of the dispute, then the
"Recalculation Date" means the most recent Valuation Date under Paragraph 3.
"Resolution Time" has the meaning specified in Paragraph 13.
"Return Amount" has the meaning specified in Paragraph 3(b).
"Secured Party" means either party, when that party (i) makes a demand for or
is entitled to receive Eligible Credit Support under Paragraph 3(a) or (ii)
holds or is deemed to hold Posted Credit Support.
"Specified Condition" means, with respect to a party, any event specified as
such for that party in Paragraph 13.
"Substitute Credit Support" has the meaning specified in Paragraph 4(d)(i).
"Substitution Date" has the meaning specified in Paragraph 4(d)(ii).
"Threshold" means, with respect to a party, the amount specified as such for
that party in Paragraph 13; if no amount is specified, zero.
"Transfer" means, with respect to any Eligible Credit Support, Posted Credit
Support or Interest Amount, and in accordance with the instructions of the
Secured Party, Pledgor or Custodian, as applicable:
(i) in the case of Cash, payment or delivery by wire transfer into one or
more bank accounts specified by the recipient;
(ii) in the case of certificated securities that cannot be paid or
delivered by book-entry, payment or delivery in appropriate physical
form to the recipient or its account accompanied by any duly executed
instruments of transfer, assignments in blank, transfer tax stamps
and any other documents necessary to constitute a legally valid
transfer to the recipient;
(iii) in the case of securities that can be paid or delivered by
book-entry, the giving of written instructions to the relevant
depository institution or other entity specified by the recipient,
together with a written copy thereof to the recipient, sufficient if
complied with to result in a legally effective transfer of the
relevant interest to the recipient; and
(iv) in the case of Other Eligible Support or Other Posted Support, as
specified in Paragraph 13.
"Valuation Agent" has the meaning specified in Paragraph 13.
"Valuation Date" means each date specified in or otherwise determined pursuant
to Paragraph 13.
"Valuation Percentage" means, for any item of Eligible Collateral, the
percentage specified in Paragraph 13.
"Valuation Time" has the meaning specified in Paragraph 13.
"Value" means for any Valuation Date or other date for which Value is
calculated and subject to Paragraph 5 in the case of a dispute, with respect
to:
(i) Eligible Collateral or Posted Collateral that is:
(A) Cash, the amount thereof; and
(B) a security, the bid price obtained by the Valuation Agent
multiplied by the applicable Valuation Percentage, if any;
(ii) Posted Collateral that consists of items that are not specified as
Eligible Collateral, zero; and
(iii) Other Eligible Support and Other Posted Support, as specified in
Paragraph 13.
Credit Support Annex (con't)
----------------------------
Paragraph 13. Elections and Variables
(a) Security Interest for "Obligations". The term "Obligations" as used
in this Annex includes the following additional obligations with
respect to MSCS and the Trust: None.
(b) Credit Support Obligations.
(i) "Delivery Amount," "Return Amount" and "Credit Support
Amount" each has the meaning specified in Paragraph 3.
(ii) Eligible Collateral. The following items will qualify as
"Eligible Collateral" for MSCS:
----------------------------------------------------------------------------------------------
Valuation
Eligible Collateral MSCS Percentage
----------------------------------------------------------------------------------------------
(A) Cash [X] 100%
(B) Treasury Securities with a remaining maturity of 52 weeks [X] 97%
or less
(C) Treasury Securities with a remaining maturity of more than [X] 93%
52 weeks but no more than 5 years
(D) Treasury Securities with a remaining maturity of more than [X] 92%
5 years but no more than 10 years
(E) Treasury Securities with a remaining maturity of more than [X] 88%
10 years but no more than 20 years
(F) Treasury Securities with a remaining maturity of more than [X] 80.5%
20 years but no more than 30 years
(G) Agency Notes with a remaining maturity of no more than 15 [X] 87%
years
(H) Agency Notes with a remaining maturity of more than 15 [X] 78.5%
years but no more than 30 years
(I) Commercial Paper rated "A-1+" by S&P and "P-1" by Xxxxx'x [X] 96.5%
(J) Commercial Paper rated "A-1" by S&P and P-1 by Xxxxx'x, [X] 96.5%
with a remaining maturity of 180 days or less
(K) Commercial Paper rated "A-1" by S&P and "P-1" by Xxxxx'x, [X] 94%
with a remaining maturity of more than 180 days or but no
more than 360 days
(L) Corporate Bonds with a long-term, senior, unsecured, [X] 66%
unsubordinated debt rating as to principal and interest of
"AAA" and "Aaa" by S&P and Xxxxx'x other than the
Corporate Bonds Corporate Bonds rated "AAA" by S&P or
"Aaa" by Xxxxx'x held in the Trust's portfolio
(iii) Other Eligible Support: Not applicable.
(iv) Thresholds.
(1) "Independent Amount" means with respect to MSCS, zero;
provided, however, if MSCS is downgraded (or on watch
for downgrade by Xxxxx'x) (as described in Part 1(o)
of the Schedule) and is required to post collateral
pursuant to the terms of Part 1(o), then the
"Independent Amount" with respect to MSCS, shall be
the aggregate of any Transaction Independent Amounts
in respect of all Transactions outstanding at that
time.
"Transaction Independent Amount" shall mean
(unless otherwise agreed by the Rating
Agencies) 1% of the Notional Amount of each
Transaction.
(2) "Threshold" means with respect to MSCS: Infinite;
provided, however if MSCS is downgraded (or on watch
for downgrade by Xxxxx'x) (as described in Part 1(o)
of the Schedule) and is required to post collateral
pursuant to the terms of Part 1(o), then the
"Threshold" with respect to MSCS, shall be zero
(unless otherwise agreed by the Rating Agencies);
"Threshold" means with respect to the Trust: Infinite.
(3) "Minimum Transfer Amount" means with respect to MSCS:
USD 100,000; and with respect to the Trust: USD
100,000; provided, however, that if such party is a
Defaulting Party at the time, "Minimum Transfer
Amount" shall mean zero with respect to such party.
(4) Rounding. The Delivery Amount and the Return Amount
will not be rounded up or down.
(c) Valuation and Timing.
(i) "Valuation Agent" means MSCS.
(ii) "Valuation Date" means each New York Banking Day (as defined
in the 2000 ISDA Definitions as published by the
International Swaps and Derivatives Association, Inc.
("ISDA") without regard to any amendment after the date
hereof) (the "ISDA Definitions").
(iii) "Valuation Time" means the close of business in New York on
the New York Banking Day before the Valuation Date or date
of calculation, as applicable, or any time on the Valuation
Date or date of calculation, as applicable; provided that
the calculations of Value and Exposure will be made as of
approximately the same time on the same date.
(iv) "Notification Time" means 1:00 p.m., New York time, on a
Local Business Day.
(d) Conditions Precedent and Secured Party's Rights and Remedies. The
following Termination Events will be a "Specified Condition" for
the party specified (that party being the Affected Party of the
Termination Event occurs with respect to that party): Not
Applicable.
(e) Substitution.
(i) "Substitution Date" has the meaning specified in Paragraph
4(d)(ii).
(ii) Consent. The Pledgor need not obtain the Secured Party's
consent for any substitution pursuant to Paragraph 4(d).
(f) Dispute Resolution.
(i) "Resolution Time" means 1:00 p.m., New York time, on the
Local Business Day following the date on which the notice of
the dispute is given under Paragraph 5.
(ii) Value. For the purpose of Paragraphs 5(i)(C) and 5(ii), the
Value of Posted Credit Support or of any Transfer of
Eligible Credit Support or Posted Credit Support, as the
case may be, will be calculated by the Valuation Agent in
accordance with standard market practice using third party
sources (such as, by way of example only, Bloomberg or
Reuters) where available.
(iii) Alternative. The provisions of Paragraph 5 will apply.
(g) Holding and Using Posted Collateral.
(i) Eligibility to Hold Posted Collateral; Custodian. The Trust
and its Custodian will be entitled to hold Posted Collateral
pursuant to Paragraph 6(b); provided that the following
conditions applicable to it are satisfied:
(1) The Trust is not a Defaulting Party.
(2) Posted Collateral may be held only in the following
jurisdictions: New York
Initially, the Custodian for the Trust is Bank of
Tokyo-Mitsubishi Trust Company.
(ii) Use of Posted Collateral. The provisions of Paragraph 6(c)
will not apply.
(h) Distributions and Interest Amount.
(i) "Interest Rate". The "Interest Rate" shall be as agreed by
both parties at the time of Transfer of Posted Collateral in
the form of cash.
(ii) Transfer of Interest Amount. The Transfer of the Interest
Amount will be made on the last Local Business Day of each
calendar month and on any Local Business Day that Posted
Collateral in the form of cash in the relevant currency is
Transferred to the Pledgor pursuant to Paragraph 3(b).
(iii) Alternative to Interest Amount. The provisions of Paragraph
6(d)(ii) will apply.
(i) Additional Representation(s).
(j) Other Eligible Support and Other Posted Support. "Value" and
"Transfer" with respect to Other Eligible Support and Other Posted
Support each means: Not applicable.
(k) Demands and Notices
All demands, specifications and notices to MSCS under this Annex
will be made to:
Xxxxxx Xxxxxxx Capital Services Inc
0000 Xxxxxxxx
0xx Xx. - FID Controllers
Xxx Xxxx, XX 00000
Attn: FID Collateral Manager
Telephone No.: (212) 761 - 2628
Facsimile No.: (000) 000 0000
Email: xxxxxxxxx@xxxx.xxx
and all demands, specifications and notices to the Trust under
this Annex will be made to:
MMCA Auto Owner Trust 2002-5
c/o Wilmington Trust Company,
as Owner Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
provided that any demand, specification or notice may be made by
telephone ("Telephone Notice") between employees of each party if
such Telephone Notice is confirmed by a subsequent written
instruction (which may be delivered via facsimile or email) by the
close of business on the same day that such Telephone Notice is
given.
(l) Addresses for Transfers.
MSCS:
Cash: CITIBANK, New York
ABA No.: 021 000 089
Account No.: 4072 - 4601
Treasury Securities
and Agency Notes: Bank of New York, New York/Xxxxxx Xxxxxxx &
Co. Incorporated
ABA No.: 000000000
Other Forms of Eligible Collateral: As provided by MSCS.
The Trust:
Cash: Bank of Tokyo-Mitsubishi Trust Company, New York, NY
ABA No.: 00000000
Account No.: 00000000
DTC Eligible Securities:
To be provided by the Trust.
(m) Other Provisions.
Notwithstanding any other provision in this Agreement to the
contrary, no full or partial failure to exercise and no delay in
exercising, on the part of MSCS or the Trust, any right, remedy,
power or privilege permitted hereunder shall operate in any way as
a waiver thereof by such party, including without limitation any
failure to exercise or any delay in exercising to any or to the
full extent of such party's rights with respect to transfer timing
pursuant to Paragraph 4(b), regardless of the frequency of such
failure or delay.
(n) Agreement as to Single Secured Party and Pledgor. MSCS and the
Trust agree that, notwithstanding anything to the contrary in the
recital to this Annex, Paragraph 1(b) or Paragraph 2 or the
definitions of Paragraph 12, (a) the term "Secured Party" as used
in this Annex shall mean only the Trust, (b) the term "Pledgor" as
used in this Annex shall mean only MSCS, (c) only MSCS makes the
pledge and grant in Paragraph 2, the acknowledgement in the final
sentence of Paragraph 8(a) and the representations in paragraph 9
and (d) only MSCS will be required to make Transfers of Eligible
Credit Support hereunder.
(o) Additional Definitions.
"Agency Notes" means U.S. Dollar-denominated fixed rate,
non-amortising, non-mortgage-backed, senior debt securities of
fixed maturity, rated "Aaa" by Xxxxx'x and "AAA" by S&P issued by
any of the Federal Home Loan Banks (including their consolidated
obligations issued through the Office of Finance of the Federal
Home Loan Bank System), the Federal National Mortgage Association,
the Federal Home Loan Mortgage Corporation or the Federal Farm
Credit Bank.
"Commercial Paper" means U.S. Dollar-denominated commercial paper
issued by a corporation, finance company, partnership or limited
liability company.
"Corporate Bonds" means U.S. Dollar-denominated debt securities,
which provides for periodic interest payments in cash over the life
of the security and principal payments upon maturity or redemption,
as applicable, with a remaining maturity of 30 years or less issued
by an entity other than an Agency or the U.S. Treasury Department.
"Rating Agencies" shall mean Fitch Ratings (and any successor or
successors thereto), Xxxxx'x (and any successor or successors
thereto) and S&P (and any successor or successors thereto).
"Treasury Securities" means U.S. Dollar-denominated senior debt
securities of the United States of America issued by the U.S.
Treasury Department and backed by the full faith and credit of the
United States of America.
IN WITNESS WHEREOF, the parties have executed this Credit
Support Annex by their duly authorized officers as of the date hereof.
XXXXXX XXXXXXX CAPITAL SERVICES INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx Xxxxx Xxxxxx
Title: Vice President
Date: December 18, 2002
MMCA AUTO OWNER TRUST 2002-5
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
nor as a principal to this
Agreement, but solely as
Owner Trustee
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Financial Services
Officer
Date: December 18, 2002
Class A-2 Notes Swap Confirmation
---------------------------------
December 18, 2002
To: Xxxxxx Xxxxxxx Capital Services Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
From:
MMCA Auto Owner Trust 2002-5
c/o Wilmington Trust Company,
as Owner Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Tel: (000) 000-0000
Fax: (000) 000-0000
Re: Confirmation Relating to MMCA 2002-5 Class A-2 Notes Interest
Rate Swap MSCS Reference No. ARK0Y
Ladies and Gentlemen:
The purpose of this letter agreement is to confirm the
terms and conditions of the Swap Transaction entered into between Xxxxxx
Xxxxxxx Capital Services Inc. ("MSCS") and
MMCA Auto Owner Trust 2002-5 (the
"Trust") on the Trade Date listed below (the "Transaction"). This letter
constitutes a "Confirmation" as referred to in the
ISDA Master Agreement
specified below.
The definitions and provisions contained in the 2000
ISDA Definitions, together with the Annex to the 2000 ISDA Definitions, as
published by the International Swaps and Derivatives Association, Inc. (the
"Definitions") are incorporated into this Confirmation. For these purposes,
all references in those Definitions to a "Transaction" shall be deemed to
apply to the Transaction referred to herein. In the event of any inconsistency
between the Definitions and this Confirmation, the terms of this Confirmation
shall govern.
This Confirmation supplements, forms part of and is
subject to the
ISDA Master Agreement, dated December 18, 2002, as amended and
supplemented from time to time (the "Agreement") between you and us. All
provisions contained in or incorporated by reference in the Agreement upon its
execution will govern this Confirmation except as expressly modified below. In
the event of any inconsistency between the provisions of that agreement and
this Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
The terms of the particular Transaction to which this
Confirmation relates are as follows:
Trade Date: December 10, 2002.
Effective Date: December 18, 2002.
Notional Amount: The Notional Amount initially shall equal
$110,000,000 and for any subsequent Calculation
Period shall be equal to the aggregate principal
balance of the Class A-2 Notes on the first day of
such Calculation Period. The Trust shall determine
the Notional Amount for each Calculation Period
and shall notify MSCS of such determination by the
15th day of the calendar month in which such
Calculation Period begins; provided, however,
unless otherwise agreed, if such notification is
not received by the 12th day of the calendar month
in which such Calculation Period ends, the
Notional Amount for any Calculation Period shall
be the amount set forth on the attached Schedule
1.
Notional Amount determinations shall be provided
to MSCS via telephone to the Fixed Income
Derivatives Corporate Desk (as specified below)
and confirmed in writing to each of the following:
Fixed Income Derivatives (Corporate Desk)
Attention: Xxxx Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xx@xxxxxxxxxxxxx.xxx
Fixed Income Derivatives (Swaps Trading Desk)
Attention: Xxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xxxx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xxxx@xxxxxxxxxxxxx.xxx
MSCS Operations Contact (see below)
Termination Date: The date on which the aggregate outstanding
principal balance of the Class A-2 Notes has been
reduced to zero, or the Fixed Rate Payer Payment
Date occurring in February 2006, whichever is the
earlier.
Fixed Amounts:
Fixed Rate Payer: The Trust.
Fixed Rate Payer
Payment Dates: The 15th day of each calendar month commencing on
January 15, 2003, up to and including the
Termination Date, subject to adjustment in
accordance with the Following Business Day
Convention.
Period End Date: Not Adjusted (the 14th day of each calendar month).
Fixed Rate: 1.961%.
Fixed Rate
Day Count Fraction: 30/360.
Floating Amounts:
Floating Rate Payer: MSCS.
Floating Rate Payer
Payment Dates: The 15th day of each calendar month commencing on
January 15, 2003, up to and including the
Termination Date, subject to adjustment in
accordance with the Following Business Day
Convention.
Period End Date: The 15th day of each calendar month, subject to
adjustment in accordance with the Modified
Following Business Day Convention.
Floating Rate Option: USD-LIBOR-BBA. Notwithstanding Section 7.1 of the
Definitions, the Floating Rate shall be determined
on the day that is two New York and London Banking
Days prior to the Reset Date. The rate determined
in accordance with the Floating Rate Option shall
be rounded, if necessary, to the nearest 1/100,000
of 1% (.0000001).
Designated Maturity: One month.
Spread: 0.20%.
Floating Rate
Day Count Fraction: Actual/360.
Floating Rate
for Initial
Calculation Period: 1.42% (excluding spread).
Reset Dates: The first day of each Floating Rate Payer
Calculation Period.
Business Days: New York, New York, Wilmington,
Delaware
and Los Angeles, California.
Account Details:
Payments to MSCS: Citibank, New York
ABA #: 000000000
For: Xxxxxx Xxxxxxx Capital Services Inc.
Account #: 00000000
Payments to the
Trust: Bank of Tokyo-Mitsubishi Trust Company
New York, NY
ABA #: 26009687
Account #: 00000000
Misc.
MSCS Operations
Contact: Xxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Calculation Agent: MSCS.
Please confirm that the foregoing correctly sets forth
the terms of our agreement by executing this Confirmation and returning it to
us.
Best Regards,
MMCA AUTO OWNER TRUST 2002-5
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
nor as a principal to this
Agreement, but solely as Owner
Trustee
By: /s/ Xxxxxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: Financial Services Officer
Accepted and confirmed as of the Trade Date
written above:
XXXXXX XXXXXXX CAPITAL SERVICES INC.
By: /s/ Xxxx X. Xxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Schedule 1
----------
---------------------------------------------------------------------
Start: End: A-2 Notional Balance
---------------------------------------------------------------------
12/18/02 1/15/03 $ 110,000,000
---------------------------------------------------------------------
1/15/03 2/15/03 $ 110,000,000
---------------------------------------------------------------------
2/15/03 3/15/03 $ 110,000,000
---------------------------------------------------------------------
3/15/03 4/15/03 $ 110,000,000
---------------------------------------------------------------------
4/15/03 5/15/03 $ 110,000,000
---------------------------------------------------------------------
5/15/03 6/15/03 $ 110,000,000
---------------------------------------------------------------------
6/15/03 7/15/03 $ 108,211,342
---------------------------------------------------------------------
7/15/03 8/15/03 $ 99,812,288
---------------------------------------------------------------------
8/15/03 9/15/03 $ 92,237,573
---------------------------------------------------------------------
9/15/03 10/15/03 $ 84,972,864
---------------------------------------------------------------------
10/15/03 11/15/03 $ 77,307,434
---------------------------------------------------------------------
11/15/03 12/15/03 $ 69,070,446
---------------------------------------------------------------------
12/15/03 1/15/04 $ 60,937,159
---------------------------------------------------------------------
1/15/04 2/15/04 $ 52,120,045
---------------------------------------------------------------------
2/15/04 3/15/04 $ 41,562,717
---------------------------------------------------------------------
3/15/04 4/15/04 $ 28,423,303
---------------------------------------------------------------------
4/15/04 5/15/04 $ 16,534,225
---------------------------------------------------------------------
5/15/04 6/15/04 $ 6,801,165
---------------------------------------------------------------------
Class A-3 Notes Swap Confirmation
---------------------------------
December 18, 2002
To: Xxxxxx Xxxxxxx Capital Services Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
From: MMCA Auto Owner Trust 2002-5
c/o Wilmington Trust Company,
as Owner Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Tel: (000) 000-0000
Fax: (000) 000-0000
Re: Confirmation Relating to MMCA 2002-5 Class A-3 Notes Interest
Rate Swap
MSCS Reference No. ARK10
Ladies and Gentlemen:
The purpose of this letter agreement is to confirm the
terms and conditions of the Swap Transaction entered into between Xxxxxx
Xxxxxxx Capital Services Inc. ("MSCS") and MMCA Auto Owner Trust 2002-5 (the
"Trust") on the Trade Date listed below (the "Transaction"). This letter
constitutes a "Confirmation" as referred to in the
ISDA Master Agreement
specified below.
The definitions and provisions contained in the 2000
ISDA Definitions, together with the Annex to the 2000 ISDA Definitions, as
published by the International Swaps and Derivatives Association, Inc. (the
"Definitions") are incorporated into this Confirmation. For these purposes,
all references in those Definitions to a "Transaction" shall be deemed to
apply to the Transaction referred to herein. In the event of any inconsistency
between the Definitions and this Confirmation, the terms of this Confirmation
shall govern.
This Confirmation supplements, forms part of and is
subject to the
ISDA Master Agreement, dated December 18, 2002, as amended and
supplemented from time to time (the "Agreement") between you and us. All
provisions contained in or incorporated by reference in the Agreement upon its
execution will govern this Confirmation except as expressly modified below. In
the event of any inconsistency between the provisions of that agreement and
this Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
The terms of the particular Transaction to which this
Confirmation relates are as follows:
Trade Date: December 10, 2002.
Effective Date: December 18, 2002.
Notional Amount: The Notional Amount initially shall equal
$89,000,000 and for any subsequent Calculation
Period shall be equal to the aggregate principal
balance of the Class A-3 Notes on the first day of
such Calculation Period. The Trust shall determine
the Notional Amount for each Calculation Period
and shall notify MSCS of such determination by the
15th day of the calendar month in which such
Calculation Period begins; provided, however,
unless otherwise agreed, if such notification is
not received by the 12th day of the calendar month
in which such Calculation Period ends, the
Notional Amount for any Calculation Period shall
be the amount set forth on the attached Schedule 1.
Notional Amount determinations shall be provided
to MSCS via telephone to the Fixed Income
Derivatives Corporate Desk (as specified below)
and confirmed in writing to each of the following:
Fixed Income Derivatives (Corporate Desk)
Attention: Xxxx Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xx@xxxxxxxxxxxxx.xxx
Fixed Income Derivatives (Swaps Trading Desk)
Attention: Xxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xxxx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xxxx@xxxxxxxxxxxxx.xxx
MSCS Operations Contact (see below)
Termination Date: The date on which the aggregate outstanding
principal balance of the Class A-3 Notes has been
reduced to zero, or the Fixed Rate Payer Payment
Date occurring in May 2007, whichever is the
earlier.
Fixed Amounts:
Fixed Rate Payer: The Trust.
Fixed Rate Payer
Payment Dates: The 15th day of each calendar month
commencing on January 15, 2003, up to and
including the Termination Date, subject to
adjustment in accordance with the Following
Business Day Convention.
Period End Date: Not Adjusted (the 14th day of each calendar month).
Fixed Rate: 2.645%.
Fixed Rate
Day Count Fraction: 30/360.
Floating Amounts:
Floating Rate Payer: MSCS.
Floating Rate Payer
Payment Dates: The 15th day of each calendar month
commencing on January 15, 2003, up to and
including the Termination Date, subject to
adjustment in accordance with the Following
Business Day Convention.
Period End Date: The 15th day of each calendar month, subject to
adjustment in accordance with the Modified
Following Business Day Convention.
Floating Rate Option: USD-LIBOR-BBA. Notwithstanding Section 7.1 of the
Definitions, the Floating Rate shall be determined
on the day that is two New York and London Banking
Days prior to the Reset Date. The rate determined
in accordance with the Floating Rate Option shall
be rounded, if necessary, to the nearest 1/100,000
of 1% (.0000001).
Designated Maturity: One month.
Spread: 0.30%.
Floating Rate
Day Count Fraction: Actual/360.
Floating Rate for
Initial Calculation
Period: 1.42% (excluding spread).
Reset Dates: The first day of each Floating Rate Payer
Calculation Period.
Business Days: New York, New York, Wilmington,
Delaware
and Los Angeles, California.
Account Details:
Payments to MSCS: Citibank, New York
ABA #: 000000000
For: Xxxxxx Xxxxxxx Capital Services Inc.
Account #: 00000000
Payments to
the Trust: Bank of Tokyo-Mitsubishi Trust Company
New York, NY
ABA #: 26009687
Account #: 00000000
Misc.
MSCS Operations
Contact: Xxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Calculation Agent: MSCS.
Please confirm that the foregoing correctly sets forth
the terms of our agreement by executing this Confirmation and returning it to
us.
Best Regards,
MMCA AUTO OWNER TRUST 2002-5
By: WILMINGTON TRUST COMPANY,
not in its individual capacity nor
as a principal to this Agreement,
but solely as Owner Trustee
By: /s/ Xxxxxxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: Financial Services Officer
Accepted and confirmed as of the Trade Date
written above:
XXXXXX XXXXXXX CAPITAL SERVICES INC.
By: /s/ Xxxx X. Xxxxxxx
---------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Schedule 1
----------
---------------------------------------------------------------------
Start: End: A-3 Notional Balance
---------------------------------------------------------------------
12/18/02 1/15/03 $ 89,000,000
---------------------------------------------------------------------
1/15/03 2/15/03 $ 89,000,000
---------------------------------------------------------------------
2/15/03 3/15/03 $ 89,000,000
---------------------------------------------------------------------
3/15/03 4/15/03 $ 89,000,000
---------------------------------------------------------------------
4/15/03 5/15/03 $ 89,000,000
---------------------------------------------------------------------
5/15/03 6/15/03 $ 89,000,000
---------------------------------------------------------------------
6/15/03 7/15/03 $ 89,000,000
---------------------------------------------------------------------
7/15/03 8/15/03 $ 89,000,000
---------------------------------------------------------------------
8/15/03 9/15/03 $ 89,000,000
---------------------------------------------------------------------
9/15/03 10/15/03 $ 89,000,000
---------------------------------------------------------------------
10/15/03 11/15/03 $ 89,000,000
---------------------------------------------------------------------
11/15/03 12/15/03 $ 89,000,000
---------------------------------------------------------------------
12/15/03 1/15/04 $ 89,000,000
---------------------------------------------------------------------
1/15/04 2/15/04 $ 89,000,000
---------------------------------------------------------------------
2/15/04 3/15/04 $ 89,000,000
---------------------------------------------------------------------
3/15/04 4/15/04 $ 89,000,000
---------------------------------------------------------------------
4/15/04 5/15/04 $ 89,000,000
---------------------------------------------------------------------
5/15/04 6/15/04 $ 89,000,000
---------------------------------------------------------------------
6/15/04 7/15/04 $ 87,755,012
---------------------------------------------------------------------
7/15/04 8/15/04 $ 80,089,399
---------------------------------------------------------------------
8/15/04 9/15/04 $ 72,784,422
---------------------------------------------------------------------
9/15/04 10/15/04 $ 65,333,301
---------------------------------------------------------------------
10/15/04 11/15/04 $ 57,994,289
---------------------------------------------------------------------
11/15/04 12/15/04 $ 51,002,785
---------------------------------------------------------------------
12/15/04 1/15/05 $ 43,907,700
---------------------------------------------------------------------
1/15/05 2/15/05 $ 36,613,634
---------------------------------------------------------------------
2/15/05 3/15/05 $ 29,363,509
---------------------------------------------------------------------
3/15/05 4/15/05 $ 22,394,373
---------------------------------------------------------------------
4/15/05 5/15/05 $ 15,599,882
---------------------------------------------------------------------
5/15/05 6/15/05 $ 9,039,256
---------------------------------------------------------------------
6/15/05 7/15/05 $ 2,656,721
---------------------------------------------------------------------
Class A-4 Notes Swap Confirmation
---------------------------------
December 18, 2002
To: Xxxxxx Xxxxxxx Capital Services Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
From: MMCA Auto Owner Trust 2002-5
c/o Wilmington Trust Company,
as Owner Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Tel: (000) 000-0000
Fax: (000) 000-0000
Re: Confirmation Relating to MMCA 2002-5 Class A-4
Notes Interest Rate Swap
MSCS Reference No. ARK12
Ladies and Gentlemen:
The purpose of this letter agreement is to confirm the terms
and conditions of the Swap Transaction entered into between Xxxxxx Xxxxxxx
Capital Services Inc. ("MSCS") and MMCA Auto Owner Trust 2002-5 (the "Trust")
on the Trade Date listed below (the "Transaction"). This letter constitutes a
"Confirmation" as referred to in the
ISDA Master Agreement specified below.
The definitions and provisions contained in the 2000 ISDA
Definitions, together with the Annex to the 2000 ISDA Definitions, as
published by the International Swaps and Derivatives Association, Inc. (the
"Definitions") are incorporated into this Confirmation. For these purposes,
all references in those Definitions to a "Transaction" shall be deemed to
apply to the Transaction referred to herein. In the event of any inconsistency
between the Definitions and this Confirmation, the terms of this Confirmation
shall govern.
This Confirmation supplements, forms part of and is subject
to the ISDA Master Agreement, dated December 18, 2002, as amended and
supplemented from time to time (the "Agreement") between you and us. All
provisions contained in or incorporated by reference in the Agreement upon its
execution will govern this Confirmation except as expressly modified below. In
the event of any inconsistency between the provisions of that agreement and
this Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
The terms of the particular Transaction to which this
Confirmation relates are as follows:
Trade Date: December 10, 2002.
Effective Date: December 18, 2002.
Notional Amount: The Notional Amount initially shall equal $80,575,000 and for any subsequent
Calculation Period shall be equal to the aggregate principal balance of the
Class A-4 Notes on the first day of such Calculation Period. The Trust shall
determine the Notional Amount for each Calculation Period and shall notify
MSCS of such determination by the 15th day of the calendar month in which
such Calculation Period begins; provided, however, unless otherwise agreed,
if such notification is not received by the 12th day of the calendar month in
which such Calculation Period ends, the Notional Amount for any Calculation
Period shall be the amount set forth on the attached Schedule 1.
Notional Amount determinations shall be provided to MSCS via telephone to the
Fixed Income Derivatives Corporate Desk (as specified below) and confirmed in
writing to each of the following:
Fixed Income Derivatives (Corporate Desk)
Attention: Xxxx Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xx@xxxxxxxxxxxxx.xxx
Fixed Income Derivatives (Swaps Trading Desk)
Attention: Xxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xxxx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xxxx@xxxxxxxxxxxxx.xxx
MSCS Operations Contact (see below)
Termination Date: The date on which the aggregate outstanding principal balance of the Class
A-4 Notes has been reduced to zero, or the Fixed Rate Payer Payment Date
occurring in August 2009, whichever is the earlier.
Fixed Amounts:
Fixed Rate Payer: The Trust.
Fixed Rate Payer
Payment Dates: The 15th day of each calendar month commencing on January 15, 2003, up to and
including the Termination Date, subject to adjustment in accordance with the
Following Business Day Convention.
Period End Date: Not Adjusted (the 14th day of each calendar month).
Fixed Rate: 3.398%.
Fixed Rate
Day Count Fraction: 30/360.
Floating Amounts:
Floating Rate Payer: MSCS.
Floating Rate
Payer Payment
Dates: The 15th day of each calendar month commencing on January 15, 2003, up to and
including the Termination Date, subject to adjustment in accordance with the
Following Business Day Convention.
Period End Date: The 15th day of each calendar month, subject to adjustment in accordance with
the Modified Following Business Day Convention.
Floating Rate
Option: USD-LIBOR-BBA. Notwithstanding Section 7.1 of the Definitions, the Floating
Rate shall be determined on the day that is two New York and London Banking
Days prior to the Reset Date. The rate determined in accordance with the
Floating Rate Option shall be rounded, if necessary, to the nearest 1/100,000
of 1% (.0000001).
Designated Maturity: One month.
Spread: 0.45%.
Floating Rate
Day Count Fraction: Actual/360.
Floating Rate for
Initial Calculation
Period: 1.42% (excluding spread).
Reset Dates: The first day of each Floating Rate Payer Calculation Period.
Business Days: New York, New York, Wilmington, Delaware
and Los Angeles, California.
Account Details:
Payments to MSCS: Citibank, New York
ABA #: 000000000
For: Xxxxxx Xxxxxxx Capital Services Inc.
Account #: 00000000
Payments to
the Trust: Bank of Tokyo-Mitsubishi Trust Company
New York, NY
ABA #: 26009687
Account #: 00000000
Misc.
MSCS Operations
Contact: Xxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Calculation Agent: MSCS.
Please confirm that the foregoing correctly sets forth the
terms of our agreement by executing this Confirmation and returning it to us.
Best Regards,
MMCA AUTO OWNER TRUST 2002-5
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
nor as a principal to this
Agreement, but solely as Owner
Trustee
By: /s/ Xxxxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: Financial Services Officer
Accepted and confirmed as of the Trade Date
written above:
XXXXXX XXXXXXX CAPITAL SERVICES INC.
By: /s/ Xxxx X. Xxxxxxx
---------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Schedule 1
----------
---------------------------------------------------------------------
Start: End: A-4 Notional Balance
---------------------------------------------------------------------
12/18/02 1/15/03 $ 80,575,000
---------------------------------------------------------------------
1/15/03 2/15/03 $ 80,575,000
---------------------------------------------------------------------
2/15/03 3/15/03 $ 80,575,000
---------------------------------------------------------------------
3/15/03 4/15/03 $ 80,575,000
---------------------------------------------------------------------
4/15/03 5/15/03 $ 80,575,000
---------------------------------------------------------------------
5/15/03 6/15/03 $ 80,575,000
---------------------------------------------------------------------
6/15/03 7/15/03 $ 80,575,000
---------------------------------------------------------------------
7/15/03 8/15/03 $ 80,575,000
---------------------------------------------------------------------
8/15/03 9/15/03 $ 80,575,000
---------------------------------------------------------------------
9/15/03 10/15/03 $ 80,575,000
---------------------------------------------------------------------
10/15/03 11/15/03 $ 80,575,000
---------------------------------------------------------------------
11/15/03 12/15/03 $ 80,575,000
---------------------------------------------------------------------
12/15/03 1/15/04 $ 80,575,000
---------------------------------------------------------------------
1/15/04 2/15/04 $ 80,575,000
---------------------------------------------------------------------
2/15/04 3/15/04 $ 80,575,000
---------------------------------------------------------------------
3/15/04 4/15/04 $ 80,575,000
---------------------------------------------------------------------
4/15/04 5/15/04 $ 80,575,000
---------------------------------------------------------------------
5/15/04 6/15/04 $ 80,575,000
---------------------------------------------------------------------
6/15/04 7/15/04 $ 80,575,000
---------------------------------------------------------------------
7/15/04 8/15/04 $ 80,575,000
---------------------------------------------------------------------
8/15/04 9/15/04 $ 80,575,000
---------------------------------------------------------------------
9/15/04 10/15/04 $ 80,575,000
---------------------------------------------------------------------
10/15/04 11/15/04 $ 80,575,000
---------------------------------------------------------------------
11/15/04 12/15/04 $ 80,575,000
---------------------------------------------------------------------
12/15/04 1/15/05 $ 80,575,000
---------------------------------------------------------------------
1/15/05 2/15/05 $ 80,575,000
---------------------------------------------------------------------
2/15/05 3/15/05 $ 80,575,000
---------------------------------------------------------------------
3/15/05 4/15/05 $ 80,575,000
---------------------------------------------------------------------
4/15/05 5/15/05 $ 80,575,000
---------------------------------------------------------------------
5/15/05 6/15/05 $ 80,575,000
---------------------------------------------------------------------
6/15/05 7/15/05 $ 80,575,000
---------------------------------------------------------------------
7/15/05 8/15/05 $ 76,953,342
---------------------------------------------------------------------
8/15/05 9/15/05 $ 70,990,366
---------------------------------------------------------------------
9/15/05 10/15/05 $ 65,284,098
---------------------------------------------------------------------
10/15/05 11/15/05 $ 59,701,314
---------------------------------------------------------------------
11/15/05 12/15/05 $ 54,218,570
---------------------------------------------------------------------
12/15/05 1/15/06 $ 48,857,093
---------------------------------------------------------------------
1/15/06 2/15/06 $ 43,631,835
---------------------------------------------------------------------
2/15/06 3/15/06 $ 38,531,131
---------------------------------------------------------------------
3/15/06 4/15/06 $ 33,548,397
---------------------------------------------------------------------
4/15/06 5/15/06 $ 28,675,643
---------------------------------------------------------------------
5/15/06 6/15/06 $ 23,923,979
---------------------------------------------------------------------
6/15/06 7/15/06 $ 19,262,313
---------------------------------------------------------------------
7/15/06 8/15/06 $ 14,762,659
---------------------------------------------------------------------
8/15/06 9/15/06 $ 10,412,186
---------------------------------------------------------------------
9/15/06 10/15/06 $ 6,123,319
---------------------------------------------------------------------
10/15/06 11/15/06 $ 2,001,530
---------------------------------------------------------------------
Class B Notes Swap Confirmation
-------------------------------
December 18, 2002
To: Xxxxxx Xxxxxxx Capital Services Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
From: MMCA Auto Owner Trust 2002-5
c/o Wilmington Trust Company,
as Owner Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Tel: (000) 000-0000
Fax: (000) 000-0000
Re: Confirmation Relating to MMCA 2002-5 Class B Notes
Interest Rate Swap
MSCS Reference No. ARK14
Ladies and Gentlemen:
The purpose of this letter agreement is to confirm the terms
and conditions of the Swap Transaction entered into between Xxxxxx Xxxxxxx
Capital Services Inc. ("MSCS") and MMCA Auto Owner Trust 2002-5 (the "Trust")
on the Trade Date listed below (the "Transaction"). This letter constitutes a
"Confirmation" as referred to in the ISDA Master Agreement specified below.
The definitions and provisions contained in the 2000 ISDA
Definitions, together with the Annex to the 2000 ISDA Definitions, as
published by the International Swaps and Derivatives Association, Inc. (the
"Definitions") are incorporated into this Confirmation. For these purposes,
all references in those Definitions to a "Transaction" shall be deemed to
apply to the Transaction referred to herein. In the event of any inconsistency
between the Definitions and this Confirmation, the terms of this Confirmation
shall govern.
This Confirmation supplements, forms part of and is subject
to the ISDA Master Agreement, dated December 18, 2002, as amended and
supplemented from time to time (the "Agreement") between you and us. All
provisions contained in or incorporated by reference in the Agreement upon its
execution will govern this Confirmation except as expressly modified below. In
the event of any inconsistency between the provisions of that agreement and
this Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
The terms of the particular Transaction to which this
Confirmation relates are as follows:
Trade Date: December 10, 2002.
Effective Date: December 18, 2002.
Notional Amount: The Notional Amount initially shall equal $17,271,000 and for any subsequent
Calculation Period shall be equal to the aggregate principal balance of the
Class B Notes on the first day of such Calculation Period. The Trust shall
determine the Notional Amount for each Calculation Period and shall notify
MSCS of such determination by the 15th day of the calendar month in which
such Calculation Period begins; provided, however, unless otherwise agreed,
if such notification is not received by the 12th day of the calendar month in
which such Calculation Period ends, the Notional Amount for any Calculation
Period shall be the amount set forth on the attached Schedule 1.
Notional Amount determinations shall be provided to MSCS via telephone to the
Fixed Income Derivatives Corporate Desk (as specified below) and confirmed in
writing to each of the following:
Fixed Income Derivatives (Corporate Desk)
Attention: Xxxx Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xx@xxxxxxxxxxxxx.xxx
Fixed Income Derivatives (Swaps Trading Desk)
Attention: Xxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xxxx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xxxx@xxxxxxxxxxxxx.xxx
MSCS Operations Contact (see below)
Termination Date: The date on which the aggregate outstanding principal balance of the Class B
Notes has been reduced to zero, or the Fixed Rate Payer Payment Date
occurring in August 2009, whichever is the earlier.
Fixed Amounts:
Fixed Rate Payer: The Trust.
Fixed Rate Payer
Payment Dates: The 15th day of each calendar month commencing on January 15, 2003, up to and
including the Termination Date, subject to adjustment in accordance with the
Following Business Day Convention.
Period End Date: Not Adjusted (the 14th day of each calendar month).
Fixed Rate: 3.365%.
Fixed Rate
Day Count Fraction: 30/360.
Floating Amounts:
Floating Rate Payer: MSCS.
Floating Rate Payer
Payment Dates: The 15th day of each calendar month commencing on January 15, 2003, up to and
including the Termination Date, subject to adjustment in accordance with the
Following Business Day Convention.
Period End Date: The 15th day of each calendar month, subject to adjustment in accordance with
the Modified Following Business Day Convention.
Floating Rate Option: USD-LIBOR-BBA. Notwithstanding Section 7.1 of the Definitions, the Floating
Rate shall be determined on the day that is two New York and London Banking
Days prior to the Reset Date. The rate determined in accordance with the
Floating Rate Option shall be rounded, if necessary, to the nearest 1/100,000
of 1% (.0000001).
Designated Maturity: One month.
Spread: 0.85%.
Floating Rate
Day Count Fraction: Actual/360.
Floating Rate
for Initial
Calculation Period: 1.42% (excluding spread).
Reset Dates: The first day of each Floating Rate Payer Calculation Period.
Business Days: New York, New York, Wilmington, Delaware
and Los Angeles, California.
Account Details:
Payments to MSCS: Citibank, New York
ABA #: 000000000
For: Xxxxxx Xxxxxxx Capital Services Inc.
Account #: 00000000
Payments to the Trust: Bank of Tokyo-Mitsubishi Trust Company
New York, NY
ABA #: 26009687
Account #: 00000000
Misc.
MSCS Operations Contact: Xxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Calculation Agent: MSCS.
Please confirm that the foregoing correctly sets forth the
terms of our agreement by executing this Confirmation and returning it to us.
Best Regards,
MMCA AUTO OWNER TRUST 2002-5
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
nor as a principal to this
Agreement, but solely as Owner
Trustee
By: /s/ Xxxxxxxx X. Xxxxxxxx
----------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: Financial Services Officer
Accepted and confirmed as of the Trade Date
written above:
XXXXXX XXXXXXX CAPITAL SERVICES INC.
By: /s/ Xxxx X. Xxxxxxx
----------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Schedule 1
----------
---------------------------------------------------------------------
Start: End: B Notional Balance
---------------------------------------------------------------------
12/18/02 1/15/03 $ 17,271,000
---------------------------------------------------------------------
1/15/03 2/15/03 $ 17,271,000
---------------------------------------------------------------------
2/15/03 3/15/03 $ 17,271,000
---------------------------------------------------------------------
3/15/03 4/15/03 $ 17,271,000
---------------------------------------------------------------------
4/15/03 5/15/03 $ 17,271,000
---------------------------------------------------------------------
5/15/03 6/15/03 $ 17,271,000
---------------------------------------------------------------------
6/15/03 7/15/03 $ 17,160,504
---------------------------------------------------------------------
7/15/03 8/15/03 $ 16,641,645
---------------------------------------------------------------------
8/15/03 9/15/03 $ 16,173,710
---------------------------------------------------------------------
9/15/03 10/15/03 $ 15,724,926
---------------------------------------------------------------------
10/15/03 11/15/03 $ 15,251,387
---------------------------------------------------------------------
11/15/03 12/15/03 $ 14,742,540
---------------------------------------------------------------------
12/15/03 1/15/04 $ 14,240,098
---------------------------------------------------------------------
1/15/04 2/15/04 $ 13,695,413
---------------------------------------------------------------------
2/15/04 3/15/04 $ 13,043,225
---------------------------------------------------------------------
3/15/04 4/15/04 $ 12,231,525
---------------------------------------------------------------------
4/15/04 5/15/04 $ 11,497,067
---------------------------------------------------------------------
5/15/04 6/15/04 $ 10,895,798
---------------------------------------------------------------------
6/15/04 7/15/04 $ 10,398,740
---------------------------------------------------------------------
7/15/04 8/15/04 $ 9,925,189
---------------------------------------------------------------------
8/15/04 9/15/04 $ 9,473,918
---------------------------------------------------------------------
9/15/04 10/15/04 $ 9,013,618
---------------------------------------------------------------------
10/15/04 11/15/04 $ 8,560,244
---------------------------------------------------------------------
11/15/04 12/15/04 $ 8,128,337
---------------------------------------------------------------------
12/15/04 1/15/05 $ 7,690,032
---------------------------------------------------------------------
1/15/05 2/15/05 $ 7,239,434
---------------------------------------------------------------------
2/15/05 3/15/05 $ 6,791,551
---------------------------------------------------------------------
3/15/05 4/15/05 $ 6,361,027
---------------------------------------------------------------------
4/15/05 5/15/05 $ 5,941,291
---------------------------------------------------------------------
5/15/05 6/15/05 $ 5,536,002
---------------------------------------------------------------------
6/15/05 7/15/05 $ 5,141,715
---------------------------------------------------------------------
7/15/05 8/15/05 $ 4,753,863
---------------------------------------------------------------------
8/15/05 9/15/05 $ 4,385,494
---------------------------------------------------------------------
9/15/05 10/15/05 $ 4,032,985
---------------------------------------------------------------------
10/15/05 11/15/05 $ 3,688,103
---------------------------------------------------------------------
11/15/05 12/15/05 $ 3,349,401
---------------------------------------------------------------------
12/15/05 1/15/06 $ 3,018,191
---------------------------------------------------------------------
1/15/06 2/15/06 $ 2,695,396
---------------------------------------------------------------------
2/15/06 3/15/06 $ 2,380,296
---------------------------------------------------------------------
3/15/06 4/15/06 $ 2,072,483
---------------------------------------------------------------------
4/15/06 5/15/06 $ 1,771,464
---------------------------------------------------------------------
5/15/06 6/15/06 $ 1,477,926
---------------------------------------------------------------------
6/15/06 7/15/06 $ 1,189,947
---------------------------------------------------------------------
7/15/06 8/15/06 $ 911,977
---------------------------------------------------------------------
8/15/06 9/15/06 $ 643,222
---------------------------------------------------------------------
9/15/06 10/15/06 $ 378,274
---------------------------------------------------------------------
10/15/06 11/15/06 $ 123,646
---------------------------------------------------------------------
Class C Notes Swap Confirmation
-------------------------------
December 18, 2002
To: Xxxxxx Xxxxxxx Capital Services Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
From: MMCA Auto Owner Trust 2002-5
c/o Wilmington Trust Company,
as Owner Trustee
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Tel: (000) 000-0000
Fax: (000) 000-0000
Re: Confirmation Relating to MMCA 2002-5 Class C Notes
Interest Rate Swap
MSCS Reference No. ARK16
Ladies and Gentlemen:
The purpose of this letter agreement is to confirm the terms
and conditions of the Swap Transaction entered into between Xxxxxx Xxxxxxx
Capital Services Inc. ("MSCS") and MMCA Auto Owner Trust 2002-5 (the "Trust")
on the Trade Date listed below (the "Transaction"). This letter constitutes a
"Confirmation" as referred to in the ISDA Master Agreement specified below.
The definitions and provisions contained in the 2000 ISDA
Definitions, together with the Annex to the 2000 ISDA Definitions, as
published by the International Swaps and Derivatives Association, Inc. (the
"Definitions") are incorporated into this Confirmation. For these purposes,
all references in those Definitions to a "Transaction" shall be deemed to
apply to the Transaction referred to herein. In the event of any inconsistency
between the Definitions and this Confirmation, the terms of this Confirmation
shall govern.
This Confirmation supplements, forms part of and is subject
to the ISDA Master Agreement, dated December 18, 2002, as amended and
supplemented from time to time (the "Agreement") between you and us. All
provisions contained in or incorporated by reference in the Agreement upon its
execution will govern this Confirmation except as expressly modified below. In
the event of any inconsistency between the provisions of that agreement and
this Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
The terms of the particular Transaction to which this
Confirmation relates are as follows:
Trade Date: December 10, 2002.
Effective Date: December 18, 2002.
Notional Amount: The Notional Amount initially shall equal $24,376,000 and for any subsequent
Calculation Period shall be equal to the aggregate principal balance of the
Class C Notes on the first day of such Calculation Period. The Trust shall
determine the Notional Amount for each Calculation Period and shall notify
MSCS of such determination by the 15th day of the calendar month in which
such Calculation Period begins; provided, however, unless otherwise agreed,
if such notification is not received by the 12th day of the calendar month in
which such Calculation Period ends, the Notional Amount for any Calculation
Period shall be the amount set forth on the attached Schedule 1.
Notional Amount determinations shall be provided to MSCS via telephone to the
Fixed Income Derivatives Corporate Desk (as specified below) and confirmed in
writing to each of the following:
Fixed Income Derivatives (Corporate Desk)
Attention: Xxxx Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xx@xxxxxxxxxxxxx.xxx
Fixed Income Derivatives (Swaps Trading Desk)
Attention: Xxxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxx.xxxxxxx@xxxxxxxxxxxxx.xxx
Xxxxx Xxxx
Tel: (000) 000 0000
Fax: (000) 000 0000
Email: xxxxx.xxxx@xxxxxxxxxxxxx.xxx
MSCS Operations Contact (see below)
Termination Date: The date on which the aggregate outstanding principal balance of the Class C
Notes has been reduced to zero, or the Fixed Rate Payer Payment Date
occurring in August 2009, whichever is the earlier.
Fixed Amounts:
Fixed Rate Payer: The Trust.
Fixed Rate Payer
Payment Dates: The 15th day of each calendar month commencing on January 15, 2003, up to and
including the Termination Date, subject to adjustment in accordance with the
Following Business Day Convention.
Period End Date: Not Adjusted (the 14th day of each calendar month).
Fixed Rate: 4.688%.
Fixed Rate
Day Count Fraction: 30/360.
Floating Amounts:
Floating Rate Payer: MSCS.
Floating Rate Payer
Payment Dates: The 15th day of each calendar month commencing on January 15, 2003, up to and
including the Termination Date, subject to adjustment in accordance with the
Following Business Day Convention.
Period End Date: The 15th day of each calendar month, subject to adjustment in accordance with
the Modified Following Business Day Convention.
Floating Rate Option: USD-LIBOR-BBA. Notwithstanding Section 7.1 of the Definitions, the Floating
Rate shall be determined on the day that is two New York and London Banking
Days prior to the Reset Date. The rate determined in accordance with the
Floating Rate Option shall be rounded, if necessary, to the nearest 1/100,000
of 1% (.0000001).
Designated Maturity: One month.
Spread: 2.15%.
Floating Rate
Day Count Fraction: Actual/360.
Floating Rate
for Initial
Calculation Period: 1.42% (excluding spread).
Reset Dates: The first day of each Floating Rate Payer Calculation Period.
Business Days: New York, New York, Wilmington, Delaware
and Los Angeles, California.
Account Details:
Payments to MSCS: Citibank, New York
ABA #: 000000000
For: Xxxxxx Xxxxxxx Capital Services Inc.
Account #: 00000000
Payments to the Trust: Bank of Tokyo-Mitsubishi Trust Company
New York, NY
ABA #: 26009687
Account #: 00000000
Misc.
MSCS Operations Contact: Xxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Calculation Agent: MSCS.
Please confirm that the foregoing correctly sets forth the
terms of our agreement by executing this Confirmation and returning it to us.
Best Regards,
MMCA AUTO OWNER TRUST 2002-5
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
nor as a principal to this
Agreement, but solely as Owner
Trustee
By: /s/ Xxxxxxxx X. Xxxxxxxx
----------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: Financial Services Officer
Accepted and confirmed as of the Trade Date
written above:
XXXXXX XXXXXXX CAPITAL SERVICES INC.
By: /s/ Xxxx X. Xxxxxxx
---------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Schedule 1
----------
---------------------------------------------------------------------
Start: End: C Notional Balance
---------------------------------------------------------------------
12/18/02 1/15/03 $ 24,376,000
---------------------------------------------------------------------
1/15/03 2/15/03 $ 24,376,000
---------------------------------------------------------------------
2/15/03 3/15/03 $ 24,376,000
---------------------------------------------------------------------
3/15/03 4/15/03 $ 24,376,000
---------------------------------------------------------------------
4/15/03 5/15/03 $ 24,376,000
---------------------------------------------------------------------
5/15/03 6/15/03 $ 24,376,000
---------------------------------------------------------------------
6/15/03 7/15/03 $ 24,220,048
---------------------------------------------------------------------
7/15/03 8/15/03 $ 23,487,739
---------------------------------------------------------------------
8/15/03 9/15/03 $ 22,827,303
---------------------------------------------------------------------
9/15/03 10/15/03 $ 22,193,897
---------------------------------------------------------------------
10/15/03 11/15/03 $ 21,525,552
---------------------------------------------------------------------
11/15/03 12/15/03 $ 20,807,373
---------------------------------------------------------------------
12/15/03 1/15/04 $ 20,098,236
---------------------------------------------------------------------
1/15/04 2/15/04 $ 19,329,477
---------------------------------------------------------------------
2/15/04 3/15/04 $ 18,408,989
---------------------------------------------------------------------
3/15/04 4/15/04 $ 17,263,370
---------------------------------------------------------------------
4/15/04 5/15/04 $ 16,226,767
---------------------------------------------------------------------
5/15/04 6/15/04 $ 15,378,147
---------------------------------------------------------------------
6/15/04 7/15/04 $ 14,676,607
---------------------------------------------------------------------
7/15/04 8/15/04 $ 14,008,246
---------------------------------------------------------------------
8/15/04 9/15/04 $ 13,371,329
---------------------------------------------------------------------
9/15/04 10/15/04 $ 12,721,669
---------------------------------------------------------------------
10/15/04 11/15/04 $ 12,081,785
---------------------------------------------------------------------
11/15/04 12/15/04 $ 11,472,199
---------------------------------------------------------------------
12/15/04 1/15/05 $ 10,853,582
---------------------------------------------------------------------
1/15/05 2/15/05 $ 10,217,617
---------------------------------------------------------------------
2/15/05 3/15/05 $ 9,585,482
---------------------------------------------------------------------
3/15/05 4/15/05 $ 8,977,847
---------------------------------------------------------------------
4/15/05 5/15/05 $ 8,385,438
---------------------------------------------------------------------
5/15/05 6/15/05 $ 7,813,421
---------------------------------------------------------------------
6/15/05 7/15/05 $ 7,256,931
---------------------------------------------------------------------
7/15/05 8/15/05 $ 6,709,522
---------------------------------------------------------------------
8/15/05 9/15/05 $ 6,189,613
---------------------------------------------------------------------
9/15/05 10/15/05 $ 5,692,087
---------------------------------------------------------------------
10/15/05 11/15/05 $ 5,205,327
---------------------------------------------------------------------
11/15/05 12/15/05 $ 4,727,289
---------------------------------------------------------------------
12/15/05 1/15/06 $ 4,259,825
---------------------------------------------------------------------
1/15/06 2/15/06 $ 3,804,237
---------------------------------------------------------------------
2/15/06 3/15/06 $ 3,359,509
---------------------------------------------------------------------
3/15/06 4/15/06 $ 2,925,067
---------------------------------------------------------------------
4/15/06 5/15/06 $ 2,500,214
---------------------------------------------------------------------
5/15/06 6/15/06 $ 2,085,919
---------------------------------------------------------------------
6/15/06 7/15/06 $ 1,679,471
---------------------------------------------------------------------
7/15/06 8/15/06 $ 1,287,149
---------------------------------------------------------------------
8/15/06 9/15/06 $ 907,833
---------------------------------------------------------------------
9/15/06 10/15/06 $ 533,889
---------------------------------------------------------------------
10/15/06 11/15/06 $ 174,512
---------------------------------------------------------------------
