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EXHIBIT 10.1
TRANSFER AND SERVICING AGREEMENT
AMONG
ORIX CREDIT ALLIANCE RECEIVABLES TRUST 1999-A, AS ISSUER,
ORIX CREDIT ALLIANCE RECEIVABLES CORPORATION II, AS TRUST
DEPOSITOR,
ORIX CREDIT ALLIANCE, INC., AS SERVICER AND AS ORIGINATOR
(AND)
XXXXXX TRUST AND SAVINGS BANK, AS INDENTURE TRUSTEE
DATED AS OF NOVEMBER , 1999
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TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions............................................................................. 2
Section 1.02. Usage of Terms.......................................................................... 32
Section 1.03. Section References...................................................................... 33
Section 1.04. Calculations............................................................................ 33
Section 1.05. Accounting Terms........................................................................ 33
ARTICLE TWO
ESTABLISHMENT OF TRUST; TRANSFER OF CONTRACT ASSETS
Section 2.01. Creation and Funding of Trust; Transfer of Contract Assets.............................. 33
Section 2.02. Conditions to Transfer of Trust Assets to Trust......................................... 35
Section 2.03. Acceptance by Owner Trustee............................................................. 37
Section 2.04. Conveyance of Substitute Contracts...................................................... 38
Section 2.05. Release of Released Amounts............................................................. 40
Section 2.06. Delivery of Instruments................................................................. 41
ARTICLE THREE
REPRESENTATIONS AND WARRANTIES
Section 3.01. Representations and Warranties Regarding the Originator................................. 42
Section 3.02. Representations and Warranties Regarding Each Contract
and as to Certain Contracts in the Aggregate......................................... 45
Section 3.03. Representations and Warranties Regarding the Initial Contracts
in the Aggregate..................................................................... 46
Section 3.04. Representations and Warranties Regarding the Contract Files............................. 46
Section 3.05. Representations and Warranties Regarding Concentrations
of Initial Contracts................................................................. 46
Section 3.06. Representations and Warranties Regarding the Trust Depositor............................ 47
Section 3.07. Representations and Warranties Regarding the Servicer................................... 50
ARTICLE FOUR
PERFECTION OF TRANSFER AND
PROTECTION OF SECURITY INTERESTS
Section 4.01. Custody of Contracts.................................................................... 51
Section 4.02. Filing.................................................................................. 51
Section 4.03. Name Change or Relocation............................................................... 51
Section 4.04. Chief Executive Office.................................................................. 52
Section 4.05. Costs and Expenses...................................................................... 52
Section 4.06. Sale Treatment.......................................................................... 52
Section 4.07. Separateness from Trust Depositor....................................................... 52
ARTICLE FIVE
SERVICING OF CONTRACTS
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Section 5.01. Appointment and Acceptance; Responsibility for Contract
Administration....................................................................... 53
Section 5.02. General Duties.......................................................................... 53
Section 5.03. Consent to Assignment or Replacement.................................................... 54
Section 5.04. Disposition upon Termination of Contract................................................ 54
Section 5.05. Subservicers............................................................................ 54
Section 5.06. Further Assurance....................................................................... 55
Section 5.07. Notice to Obligors...................................................................... 55
Section 5.08. Collection Efforts; Modification of Contracts........................................... 55
Section 5.09. Prepaid Contract........................................................................ 56
Section 5.10. Acceleration............................................................................ 57
Section 5.11. Taxes................................................................................... 57
Section 5.12. Insurance Premiums...................................................................... 57
Section 5.13. Remittances............................................................................. 57
Section 5.14. Servicer Advances....................................................................... 57
Section 5.15. Realization upon Defaulted Contract..................................................... 58
Section 5.16. Maintenance of Insurance Policies....................................................... 58
Section 5.17. Other Servicer Covenants................................................................ 59
Section 5.18. Servicing Compensation.................................................................. 60
Section 5.19. Payment of Certain Expenses by Servicer................................................. 60
Section 5.20. Records................................................................................. 60
Section 5.21. Inspection.............................................................................. 60
Section 5.22. Trustees to Cooperate in Releases....................................................... 61
ARTICLE SIX
COVENANTS OF THE TRUST DEPOSITOR
Section 6.01. Corporate Existence..................................................................... 61
Section 6.02. Contracts Not to be Evidenced by Promissory Notes....................................... 62
Section 6.03. Security Interests...................................................................... 62
Section 6.04. Delivery of Collections................................................................. 62
Section 6.05. Regulatory Filings...................................................................... 62
Section 6.06. Compliance with Law..................................................................... 62
Section 6.07. Activities.............................................................................. 62
Section 6.08. Indebtedness............................................................................ 63
Section 6.09. Guarantees.............................................................................. 63
Section 6.10. Investments............................................................................. 63
Section 6.11. Merger; Sales........................................................................... 63
Section 6.12. Distributions........................................................................... 63
Section 6.13. Other Agreements........................................................................ 64
Section 6.14. Separate Corporate Existence............................................................ 64
Section 6.15. Location; Records....................................................................... 65
Section 6.16. Liability of Trust Depositor; Indemnities............................................... 65
Section 6.17. Bankruptcy Limitations.................................................................. 67
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Section 6.18. Limitation on Liability of Trust Depositor and Others................................... 67
Section 6.19. Chief Executive Office.................................................................. 67
ARTICLE SEVEN
ESTABLISHMENT OF ACCOUNTS; DISTRIBUTIONS; RESERVE FUND
Section 7.01. Trust Accounts; Collections............................................................. 68
Section 7.02. Reserve Fund Deposit.................................................................... 69
Section 7.03. Trust Account Procedures................................................................ 69
Section 7.04. Securityholder Distributions............................................................ 69
Section 7.05. Allocations and Distributions........................................................... 70
ARTICLE EIGHT
SERVICER DEFAULT; SERVICE TRANSFER
Section 8.01. Servicer Default........................................................................ 77
Section 8.02. Servicer Transfer....................................................................... 78
Section 8.03. Appointment of Successor Servicer; Reconveyance; Successor
Servicer to Act...................................................................... 79
Section 8.04. Notification to Securityholders......................................................... 80
Section 8.05. Effect of Transfer...................................................................... 80
Section 8.06. Database File........................................................................... 81
Section 8.07. Successor Servicer Indemnification...................................................... 81
Section 8.08. Responsibilities of the Successor Servicer.............................................. 81
Section 8.09. Rating Agency Condition for Servicer Transfer........................................... 82
ARTICLE NINE
REPORTS
Section 9.01. Monthly Reports......................................................................... 82
Section 9.02. Officer's Certificate................................................................... 82
Section 9.03. Other Data.............................................................................. 83
Section 9.04. Annual Report of Accountants............................................................ 83
Section 9.05. Annual Statement of Compliance from Servicer............................................ 84
Section 9.06. Annual Summary Statement................................................................ 84
ARTICLE TEN
TERMINATION
Section 10.01. Sale of Trust Assets.................................................................... 84
ARTICLE ELEVEN
REMEDIES UPON MISREPRESENTATION; REPURCHASE OPTION
Section 11.01. Repurchases of, or Substitution for, Contracts for Breach
of Representations and Warranties..................................................... 85
Section 11.02. Reassignment of Repurchased or Substituted Contracts.................................... 86
Section 11.03. Originator's and Trust Depositor's Repurchase Option.................................... 86
ARTICLE TWELVE
ORIGINATOR INDEMNITIES
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Section 12.01. Originator's Indemnification............................................................ 87
Section 12.02. Liabilities to Obligors................................................................. 87
Section 12.03. Tax Indemnification..................................................................... 87
Section 12.04. Adjustments............................................................................. 88
Section 12.05. Operation of Indemnities................................................................ 89
ARTICLE THIRTEEN
MISCELLANEOUS
Section 13.01. Amendment............................................................................... 89
Section 13.02. Protection of Title to Trust............................................................ 91
Section 13.03. Governing Law........................................................................... 92
Section 13.04. Notices................................................................................. 92
Section 13.05. Severability of Provisions.............................................................. 95
Section 13.06. Third Party Beneficiaries............................................................... 95
Section 13.07. Counterparts............................................................................ 95
Section 13.08. Headings................................................................................ 95
Section 13.09. No Bankruptcy Petition; Disclaimer...................................................... 95
Section 13.10. Jurisdiction............................................................................ 96
Section 13.11. Tax Characterization.................................................................... 97
Section 13.12. Prohibited Transactions with Respect to the Trust....................................... 97
Section 13.13. Merger or Consolidation of Originator or Servicer....................................... 97
Section 13.14. Assignment or Delegation by the Originator.............................................. 98
Section 13.15. Limitation of Liability of Owner Trustee................................................ 98
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EXHIBITS
EXHIBIT A Form of Assignment.................................................. A-1
EXHIBIT B Form of Closing Certificate of Trust Depositor...................... B-1
EXHIBIT C Form of Closing Certificate of Servicer/Originator.................. C-1
EXHIBIT D Form of Opinion of Counsel for Trust Depositor Regarding
General Corporate Matters (Including Perfection Opinion)............ D-1
EXHIBIT E Form of Opinion to Counsel for Trust Depositor Regarding
the "True Sale" Nature of the Transaction and Regarding
Non-consolidation................................................... E-1
EXHIBIT F Form of Certificate Regarding Repurchased Contracts................. F-1
EXHIBIT G List of Contracts................................................... G-1
EXHIBIT H Form of Monthly Report to Noteholders and
Certificateholders.................................................. H-1
EXHIBIT I Form of Subsequent Transfer Agreement............................... I-1
EXHIBIT J Form of Subsequent Purchase Agreement............................... J-1
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This TRANSFER AND SERVICING AGREEMENT, dated as of November ,
1999, is among ORIX CREDIT ALLIANCE RECEIVABLES TRUST 1999-A (together with its
successors and assigns, the "Trust"), ORIX CREDIT ALLIANCE RECEIVABLES
CORPORATION II, (together with its successor and assigns, the "Trust
Depositor"), XXXXXX TRUST AND SAVINGS BANK (solely in its capacity as Indenture
Trustee, together with its successors and assigns, the "Indenture Trustee"),
ORIX CREDIT ALLIANCE, INC. (together with its successors and assigns, "OCAI", in
its capacity as Servicer, together with its successor and assigns, the
"Servicer" and in its capacity as originator, together with its successor and
assigns, the "Originator").
WHEREAS, in the regular course of its business, the Originator
originates and purchases Contracts (as defined herein);
WHEREAS, the Trust Depositor acquired the Initial Contracts
from the Originator and may acquire from time to time thereafter certain
Substitute Contracts (such Initial Contracts and Substitute Contracts, together
with certain related property as more fully described herein, being the Contract
Assets as defined herein);
WHEREAS, it was a condition to the Trust Depositor's
acquisition of the Initial Contracts from the Originator that the Originator
make certain representations and warranties regarding the Contract Assets for
the benefit of the Trust Depositor as well as the Trust;
WHEREAS, on the Closing Date the Trust Depositor will fund the
Trust by selling, conveying and assigning all its right, title and interest in
such Contract Assets and certain other assets to the Trust;
WHEREAS, the Trust is willing to purchase and accept
assignment of the Trust Assets from the Trust Depositor pursuant to the terms
hereof; and
WHEREAS, the Servicer is willing to service the Contracts for
the benefit and account of the Trust pursuant to the terms hereof;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, the parties hereto agree as follows:
ARTICLE ONE
DEFINITIONS
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SECTION 1.01. DEFINITIONS. Whenever used in this Agreement,
the following words and phrases, unless the context otherwise requires, shall
have the following meanings:
"Accountant's Report" has the meaning assigned such term in
Section 9.04.
"Accrual Period" means the period from and including the most
recent Distribution Date to but excluding the following Distribution Date,
provided, that the initial Accrual Period following the Closing Date shall be
the period from and including the Closing Date to but excluding the first
Distribution Date following the Closing Date.
"Addition Notice" means, with respect to any transfer of
Substitute Contracts to the Trust pursuant to Section 2.04 (and the Trust
Depositor's corresponding prior purchase of such Contracts from the Originator),
a notice, which shall be given at least 5 days prior to the related Subsequent
Transfer Date, identifying the Substitute Contracts to be transferred, the
Principal Balance of such Substitute Contracts and the related Substitution
Event (with respect to an identified Contract or Contracts then in the Contracts
Pool) to which such Substitute Contract relates, with such notice to be signed
both by the Trust Depositor and the Originator.
"Additional Principal" means, with respect to a Distribution
Date (i) if the Class B Target Investor Principal Amount and the Class C Target
Investor Principal Amount exceed the Class B Floor and the Class C Floor,
respectively, an amount of $0; or (ii) if any of the conditions in clause (i)
are not satisfied, an amount equal to the excess, if any, of (A) the Monthly
Principal Amount, over (B) the sum of the Class A Principal Payment Amount,
Class B Principal Payment Amount and Class C Principal Payment Amount for such
Distribution Date.
"Affiliate" of any specified Person means any other Person
controlling or controlled by, or under common control with, such specified
Person. For the purposes of this definition, "control" when used with respect to
any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" or
"controlled" have meanings correlative to the foregoing.
"Aggregate Loss Amount" means (x) the aggregate amount of the
Contract Principal Balances (calculated as of the date immediately before every
Contract became a Defaulted Contract) of all the Contracts that became
Defaulted Contracts during all prior Collection Periods over (y) the aggregate
amount of all Recoveries collected by the Servicer with respect to such
Collection Period.
"Aggregate Principal Amount" means, with respect to any group
of Notes, at any date of determination, the sum of the Principal Amounts of such
Notes on such date of determination.
"Agreement" means this Transfer and Servicing Agreement, as
amended, supplemented or otherwise modified from time to time in accordance with
the terms thereof.
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"Assignment" means each Assignment, substantially in the form
of Exhibit A relating to an assignment, transfer and conveyance of Contracts and
related property by the Trust Depositor to the Trust.
"Available Amounts" means, as of any Distribution Date, the
sum of (i) all amounts on deposit in the Collection Account as of the
immediately preceding Determination Date on account of Scheduled Payments due
on or before, and Prepayments received on or before, the last day of the
Collection Period immediately preceding such Distribution Date (other than
Excluded Amounts), (ii) Recoveries on account of previously Defaulted Contracts
received as of the last day of the immediately preceding Collection Period;
(iii) Investment Earnings credited to the Collection Account or the Reserve Fund
as of the last day of the immediately preceding Collection Period, (iv) Late
Charges received on or before the last day of such Collection Period (provided
such late charges were included in the Contract's terms as of the applicable
Cutoff Date); (v) all amounts on deposit in the Spread Fund, and (vi) proceeds
of any of the foregoing.
"Business Day" means any day which is neither a Saturday or a
Sunday, nor another day on which banking institutions in the city of Chicago,
Illinois, Secaucus, New Jersey, Newark, Delaware or New York, New York are
authorized or obligated by law, executive order, or governmental decree to be
closed.
"Business Trust Statute" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del Code 3801 et seq., as the same may be amended from time to
time.
"Casualty Loss" means, with respect to any item of Equipment,
the loss, theft, damage beyond repair or governmental condemnation or seizure of
such item of Equipment.
"Certificate" means the $ aggregate initial principal
amount ORIX Credit Alliance Receivables Trust Certificate, Series 1999-A
representing a beneficial equity interest in the Trust and issued pursuant to
the Trust Agreement.
"Certificate Register" has the meaning specified in the Trust
Agreement.
"Certificateholder" means the registered holder of the
Certificate.
"Class" means any of the group of Notes or the Certificate
identified herein as, as applicable, the Class A-1 Notes, the Class A-2 Notes,
the Class A-3 Notes, the Class A-4 Notes, the Class B Notes, the Class C Notes,
or the Certificate.
"Class A Notes" means the Class A-1 Notes, Class A-2 Notes,
Class A-3 Notes and Class A-4 Notes.
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"Class A Percentage" means %.
"Class A Principal Payment Amount" means, with respect to a
Distribution Date, (i) while all or any portion of the Class A-1 Notes remain
outstanding after giving effect to payments on such Distribution Date, the
Monthly Principal Amount; (ii) if such Distribution Date is the Class A-1
Maturity Date, the Principal Amount of the Class A-1 Notes; (iii) if the
Principal Amount of the Class A-1 Notes is being reduced to zero on such
Distribution Date, the sum of the amount necessary to reduce the Principal
Amount of the Class A-1 Notes to zero and the amount necessary to reduce the
aggregate Principal Amount of the Class A-2 Notes, Class A-3 Notes, and Class
A-4 Notes to the Class A Target Investor Principal Amount; (iv) if the Principal
Amount of the Class A-1 Notes is zero, the amount necessary to reduce the
aggregate Principal Amount of the Class A-2 Notes, Class A-3 Notes and Class A-4
Notes to the Class A Target Investor Principal Amount; (v) if the Principal
Amount of the Class A-1 Notes and Class A-2 Notes is zero, the amount necessary
to reduce the aggregate Principal Amount of the Class A-3 Notes and Class A-4
Notes to the Class A Target Investor Principal Amount; and (vi) if the Principal
Amount of the Class A-1 Notes, Class A-2 Notes and Class A-3 Notes is zero, the
amount necessary to reduce the Principal Amount of the Class A-4 Notes to the
Class A Target Investor Principal Amount.
"Class A Target Investor Principal Amount" means, with respect
to a Distribution Date, an amount equal to the product (i) the Class A
Percentage and (ii) the Pool Balance as of the last day of the related
Collection Period.
"Class A-1 Interest Rate" means % per annum (calculated on
the basis of a year of 360 days and actual days elapsed in the Accrual Period).
"Class A-1 Maturity Date" means the Distribution Date.
"Class A-1 Noteholder" means the Person in whose name a Class
A-1 Note is registered in the Note Register.
"Class A-1 Notes" means the $ aggregate initial principal
amount ORIX Credit Alliance Receivables Trust, Class A-1 Receivable-Backed
Notes, Series 1999-A, issued pursuant to the Indenture.
"Class A-2 Interest Rate" means % per annum (calculated on
the basis of a year of 360 days and twelve 30-day months).
"Class A-2 Maturity Date" means the Distribution Date.
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"Class A-2 Noteholder" means the Person in whose name a Class
A-2 Note is registered in the Note Register.
"Class A-2 Notes" means the $ aggregate initial principal
amount ORIX Credit Alliance Receivables Trust Class A-2 Receivable-Backed Notes,
Series 1999-A, issued pursuant to the Indenture.
"Class A-3 Interest Rate" means % per annum (calculated on
the basis of a year of 360 days and twelve 30-day months).
"Class A-3 Maturity Date" means the Distribution Date.
"Class A-3 Noteholder" means the Person in whose name a Class
A-3 Note is registered in the Note Register.
"Class A-3 Notes" means the $ aggregate initial principal
amount ORIX Credit Alliance Receivables Trust Class A-3 Receivable-Backed Notes,
Series 1999-A, issued pursuant to the Indenture.
"Class A-4 Interest Rate" means % per annum (calculated on
the basis of a year of 360 days and twelve 30-day months).
"Class A-4 Maturity Date" means the Distribution Date.
"Class A-4 Noteholder" means the Person in whose name a Class
A-4 Note is registered in the Note Register.
"Class A-4 Notes" means the $ aggregate initial principal
amount ORIX Credit Alliance Receivables Trust Class A-4 Receivable-Backed Notes,
Series 1999-A, issued pursuant to the Indenture.
"Class B Floor" means, with respect to a Distribution Date,
(i) % of the Original Pool Balance plus
(ii) the Cumulative Loss Amount as of such date, minus
(iii) the sum of (a) the outstanding Principal Amount of the Class C Notes as
of the immediately preceding Distribution Date after giving effect to
all principal payments made on such date, (b) the Overcollateralization
Balance as of the immediately preceding Distribution Date and (c) the
amount on deposit in the Reserve Fund after giving effect to amounts to
be withdrawn on such date.
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"Class B Interest Rate" means % per annum (calculated on
the basis of a year of 360 days and twelve 30-day months).
"Class B Maturity Date" means the Distribution Date.
"Class B Noteholder" means the Person in whose name a Class B
Note is registered in the Note Register.
"Class B Notes" means the $ aggregate initial principal
amount ORIX Credit Alliance Receivables Trust Class B Receivable-Backed Notes,
Series 1999-A, issued pursuant to the Indenture.
"Class B Percentage" means %.
"Class B Principal Payment Amount" means, with respect to a
Distribution Date,
(i) if the Principal Amount of the Class A-1 Notes is greater than zero,
zero; and
(ii) if the Principal Amount of the Class A-1 Notes is zero, the amount
necessary to reduce the Principal Amount of the Class B Notes to the
greater of (a) the Class B Target Investor Principal Amount or (b) the
Class B Floor.
"Class B Target Investor Principal Amount" means, with respect
to a Distribution Date, an amount equal to the product of (i) the Class B
Percentage and (ii) the Pool Balance as of the last day of the related
Collection Period.
"Class C Floor" means, with respect to a Distribution Date,
(i) % of the Original Pool Balance plus
(ii) the Cumulative Loss Amount as of such date, minus
(iii) the sum of (a) the Overcollateralization Balance as of the immediately
preceding Distribution Date and (b) the amount on deposit in the
Reserve Fund after giving effect to amounts to be withdrawn on such
date;
provided, however, that if the Principal Amount of the Class B Notes as of such
Distribution Date is less than or equal to the Class B Floor on such date, the
Class C Floor will be an amount equal to the Principal Amount of the Class C
Notes utilized in the calculation of the Class B Floor for such date.
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"Class C Interest Rate" means % per annum (calculated on
the basis of a year of 360 days and twelve 30-day months).
"Class C Maturity Date" means the Distribution Date.
"Class C Noteholder" means the Person in whose name a Class C
Note is registered in the Note Register.
"Class C Notes" means the $ aggregate initial principal
amount ORIX Credit Alliance Receivables Trust Class C Receivable-Backed Notes,
Series 1999-A, issued pursuant to the Indenture.
"Class C Percentage" means %.
"Class C Principal Payment Amount" means, with respect to a
Distribution Date,
(i) if the Principal Amount of the Class A-1 Notes is greater than zero,
zero; and
(ii) if the Principal Amount of the Class A-1 Notes is zero, the amount
necessary to reduce the Principal Amount of the Class C Notes to the
greater of (a) the Class C Target Investor Principal Amount or (b) the
Class C Floor.
"Class C Target Investor Principal Amount" means, with respect
to a Distribution Date, an amount equal to the product of (i) the Class C
Percentage and (ii) the Pool Balance as of the last day of the related
Collection Period.
"Closing Date" means November , 1999.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" has the meaning given such term in the "granting
clause" of the Indenture.
"Collection Account" means the Trust Account so designated
established pursuant to Section 7.01.
"Collection Period" means a period beginning on and including
the first day of a calendar month and ending on and including, the last day of
such calendar month, provided that the first Collection Period shall be the
period beginning on the
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Initial Cutoff Date and ending on and including the last day of the calendar
month in which the Closing Date occurs.
"Collections" means all payments received on or with respect
to the Contracts in the Contracts Pool or the related Equipment, including,
without limitation, Scheduled Payments, Prepayments, Recoveries and Late
Charges, all as related to amounts attributable to the Contracts in the
Contracts Pool or the related Equipment (including any such amounts derived from
Vendor recourse provisions), but excluding any Excluded Amounts.
"Commission" means the United States Securities and Exchange
Commission.
"Computer Records" means the computer records generated by the
Servicer which provide information relating to the Contracts and which was used
by the Originator in selecting the Contracts conveyed to the Trust Depositor
pursuant to Section 2.01 (and any Subsequent Purchase Agreement conveyed to the
Trust Depositor pursuant to Section 2.04).
"Contract" means each End-User Contract, and including both
Initial Contracts and Substitute Contracts.
"Contract Assets" has the meaning assigned in Section 2.01
(and 2.04, as applicable in the case of Substitute Contracts).
"Contract File" means, with respect to each Contract, the
fully executed original counterpart (for UCC purposes) of the Contract, the
original certificate of title or other title document with respect to the
related Equipment (if applicable), and otherwise such documents, if any, that
the Servicer keeps on file in accordance with its customary procedures,
evidencing ownership of such Equipment (if applicable) and all other documents
originally delivered to the Originator or held by the Servicer with respect to
any Contract.
"Contracts Pool" as of any date means the Initial Contracts
and the Substitute Contracts (if any), other than any such Contracts which (i)
have been reconveyed by the Trust to the Trust Depositor, and concurrently by
the Trust Depositor to the Originator, pursuant to Section 11.02 hereof, or (ii)
have been paid (or prepaid) in full.
"Corporate Trust Office" means, with respect to the Indenture
Trustee or Owner Trustee, as applicable, the office of the Indenture Trustee or
Owner Trustee at which at any particular time its corporate trust business shall
be principally administered,
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which offices at the date of the execution of this Agreement are located at the
addresses set forth in Section 13.04.
"CSA" means each conditional sales agreement, including, as
applicable, schedules, subschedules, supplements and amendments to a master
conditional sales agreement, pursuant to which specified assets were
conditionally sold to an Obligor at specified monthly, quarterly, semi-annual or
annual payments.
"Cumulative Loss Amount" means, with respect to a Distribution
Date, an amount equal to the excess, if any, of:
(i) the total of
(A) the Principal Amount of the Notes as of the immediately
preceding Distribution Date after giving effect to all
principal payments made on such date, plus
(B) the Overcollateralization Balance as of the immediately
preceding Distribution Date, minus
(C) the lesser of: (1) the Monthly Principal Amount and (2)
Available Amounts remaining after payment of amounts owing to
the Servicer, including Unreimbursed Servicer Advances and
Servicing Fees, and after payment of interest on the Notes on
such date; over
(ii) the Pool Balance as of the last day of the immediately preceding
Collection Period.
"Cumulative Net Loss Percentage" means, as of a Determination
Date, the Aggregate Loss Amount percentage of the Original Pool Balance.
"Custodian Agreement" means the Custodian Agreement dated as
of the date hereof between OCAI, as custodian, and the Indenture Trustee.
"Cutoff Date" means either or both (as the context may
require) the Initial Cutoff Date and any Subsequent Cutoff Date, as applicable
to the Contract or Contracts in question.
"Date of Processing" means, with respect to any transaction or
Collection, the date on which such transaction or Collection is first recorded
(and, in the case of a transaction or Collection related to a particular
Contract, identified as to such particular
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Contract) on the Originator's or Servicer's computer master file of Contracts
(without regard to the effective date of such recordation).
"Defaulted Contract" means a Contract in the Contracts Pool
with respect to which there has occurred one or more of the following: (i) all
or some portion of any Scheduled Payment under the Contract is more than 180
days delinquent or such shorter period as the Originator may determine
consistent with its collection policy or (ii) the Servicer has determined in its
sole discretion, in accordance with its usual and customary practices (and
taking into account any available Vendor recourse), that such Contract is not
collectible.
"Determination Date" means, with respect to any Distribution
Date, the third Business Day prior to such Distribution Date.
"Distribution Date" shall mean the fifteenth day of each
calendar month or, if such fifteenth day is not a Business Day, the next
succeeding Business Day, with the first such Distribution Date hereunder being
December 15, 1999.
"Dollar" and "$" means lawful currency of the United States of
America.
"Eligible Contract" means at any date of determination, each
Contract with respect to which each of the following is true (to the extent
applicable to such type of Contract):
(a) the Contract is a valid and binding payment obligation of
the Obligor, is enforceable in accordance with its terms (except as may
be limited by applicable Insolvency Laws and the availability of
equitable remedies) and contains a clause that has the effect of
unconditionally and irrevocably obligating the Obligor to make periodic
Scheduled Payments (including taxes) to the assignee of the Contract,
notwithstanding any rights the Obligor may have against the assignor;
(b) the Contract is noncancellable by the Obligor;
(c) all payments payable under the Contract are absolute,
unconditional obligations of the Obligor and the Contract does not
provide for offset for any reason;
(d) the Contract requires the Obligor to maintain the
Equipment in good working order, to bear all the costs of operating the
Equipment, including taxes and insurance relating thereto;
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(e) the Contract, at the time it was made, did not violate the
laws of the United States or any state, except for any such violations
which would not materially and adversely affect the collectibility of
the Contracts in the Contracts Pool taken as a whole;
(f) the Contract requires that (i) the Obligor will obtain
insurance and list OCAI as the loss payee in an amount not less than
the Outstanding Principal Balance of the Contract; or (ii) in the event
of a Casualty Loss, the Servicer may require the Obligor (A) to pay at
a minimum the Outstanding Principal Balance of the Contract or (B) to
replace the Equipment with like Equipment in good repair, acceptable to
the Servicer, at the Obligor's expense;
(g) immediately prior to the transfer of such Contract and any
related Equipment (or security interest therein) to the Trust
Depositor, and immediately prior to the Trust Depositor's concurrent
transfer thereof to the Trust, such Contract was owned by the
Originator (and by the Trust Depositor following the transfer by the
Originator) free and clear of any adverse claim, other than with
respect to any Permitted Liens;
(h) (i) the Contract and any related Equipment or interest
therein have not been sold, transferred, assigned or pledged by the
Originator to any other Person (other than the financed sale of the
Equipment to the End-User effected through the End-User Contract) and
any Equipment related to such Contract is free and clear of any liens
and encumbrances of any third parties other than the Originator and
Permitted Liens, and (ii) such Contract is secured by a fully perfected
lien of the first priority in favor of the Originator on the related
Equipment;
(i) the Contract has an original maturity of not greater than
eighty-four months;
(j) the Contract is a U.S. dollar-denominated obligation and,
at inception, the Obligor and the associated Equipment were and
continue to be located in the United States;
(k) there is not more than one "secured party's original"
counterpart of the Contract;
(l) the Contract is not a consumer contract or a "consumer
lease" as defined in Section 2A-103(1)(e) of the UCC; and, if such
Contract is a Lease, it is a Lease intended for security within the
meaning of Section 1-201(39) of the UCC;
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(m) the Contract is not subject to any guarantee by the
Originator, nor has the Originator established any specific credit
reserve with respect to the related Obligor;
(n) the Contract was either originated or purchased in a
true sale transaction, by the Originator in the ordinary course of its
business in accordance with its customary underwriting practices and
credit policies and no adverse selection procedure was used in
selecting the Contract for the Contracts Pool;
(o) the Obligor has represented to the Originator or Vendor
that it has accepted the Equipment where the Contract relates to
Equipment being currently acquired;
(p) the Obligor is not, to the Originator's knowledge, subject
to bankruptcy or other insolvency proceedings;
(q) the Contract did not have a Scheduled Payment that was a
delinquent payment for more than 60 days, and the Contract is not a
Defaulted Contract;
(r) the information with respect to the Contract and the
Equipment, where the Contract relates to Equipment being currently
acquired, subject to the Contract delivered under this Agreement is
true and correct in all material respects;
(s) no provision of the Contract has been waived, altered or
modified in any respect, except by instruments or documents contained
in the Contract File;
(t) all filings necessary to evidence the conveyance or
transfer of the Originator's ownership interest in the Contract, and
the Originator's corresponding interest in the related Equipment, to
the Trust Depositor (as well as the concurrent conveyance of such
property hereunder from the Trust Depositor to the Trust), have been
made in all appropriate jurisdictions; provided, that (i) UCC financing
statement filings with respect to Equipment which name the Originator
as secured party have not been amended to indicate either the Trust
Depositor or the Trust as an assignee and (ii) filings or registrations
with respect to any title registry for any Equipment which name the
Originator as lienholder have not been amended to indicate either the
Trust Depositor or the Trust as an assignee;
(u) the Contract does not require the prior written consent of
an Obligor or contain any other restriction on the transfer or
assignment of the Contract (other than a consent or waiver of such
restriction that has been obtained
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prior to the Closing Date, with respect to an Initial Contract, or the
Subsequent Transfer Date, with respect to a Substitute Contract);
(v) the Obligor is not the United States or any state or local
government or any agency, department, subdivision or instrumentality
of any such government;
(w) the Originator has obtained a first priority perfected
security interest (subject to Permitted Liens) in the Equipment;
(x) if such Contract is a Lease, the Lease has a purchase
option amount of no greater than $102;
(y) if the Contract is a lease of Equipment subject to
certificate of title statutory requirements, the title is held either
in the name of the lessee and the certificate of title indicates the
Originator as lienholder or in the name of the Originator as Lessor;
(z) the Obligor under the Contract is required either to
maintain casualty insurance or to self-insure with respect to the
Related Equipment in accordance with the Originator's normal
requirements; and
(aa) the Contract constitutes "chattel paper" as defined under
the UCC.
"Eligible Deposit Account" means either (a) a segregated
account with a Qualified Institution, or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the laws
of the Untied States or any one of the states thereof, including the District of
Columbia (or any domestic branch of a foreign bank), and acting as a trustee for
funds deposited in such account, so long as any of the securities of such
depository institution shall have a credit rating from each Rating Agency in one
of its short-term credit rating categories which signifies investment grade.
"Eligible Investments" with respect to any Distribution Date
means negotiable instruments or securities or other investments maturing on or
before such Distribution Date (a) which, except in the case of demand or time
deposits, investments in money market funds and Eligible Repurchase Obligations,
are represented by instruments in bearer or registered form or ownership of
which is represented by book entries by a Clearing Agency or by a Federal
Reserve Bank in favor of depository institutions eligible to have an account
with such Federal Reserve Bank who hold such investments on behalf of their
customers, (b) which, as of any date of determination, mature by their terms on
or prior to the Distribution Date immediately following such date of
determination, and (c) which evidence:
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(i) direct obligations of, and obligations fully guaranteed as
to full and timely payment by, the United States of America (or by any
agency thereof to the extent such obligations are backed by the full
faith and credit of the United States of America);
(ii) demand deposits, time deposits or certificates of deposit
of depository institutions or trust companies incorporated under the
laws of the United States of America or any state thereof and subject
to supervision and examination by federal or state banking or
depository institution authorities; provided, however, that at the time
of the Trust's investment or contractual commitment to invest therein,
the commercial paper, if any, and short-term unsecured debt obligations
(other than such obligation whose rating is based on the credit of a
Person other than such institution or trust company) of such depository
institution or trust company shall have a credit rating from each
Rating Agency in the Highest Required Investment Category granted by
such Rating Agency;
(iii) commercial paper, or other short term obligations,
having, at the time of the Trust's investment or contractual commitment
to invest therein, a rating in the Highest Required Investment Category
granted by each Rating Agency;
(iv) demand deposits, time deposits or certificates of deposit
that are fully insured by the FDIC and either have a rating on their
certificates of deposit or short-term deposits from Xxxxx'x and S&P of
P-1 and A-1+, respectively, and from Fitch of F-1+, or otherwise have a
rating acceptable to the Rating Agencies;
(v) notes that are payable on demand or bankers' acceptances
issued by any depository institution or trust company referred to in
(ii) above;
(vi) investments in taxable money market funds or other
regulated investment companies having, at the time of the Trust's
investment or contractual commitment to invest therein, a rating of the
Highest Required Investment Category from each Rating Agency or whose
portfolio is limited to the investments described in clause (i) of this
definition;
(vii) time deposits (having maturities of not more than 90
days) by an entity the commercial paper of which has, at the time of
the Trust's investment or contractual commitment to invest therein, a
rating of the Highest Required Investment Category granted by each
Rating Agency;
(viii) Eligible Repurchase Obligations; and
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(ix) any negotiable instruments or securities or other
investments in which the investment by the Trust therein has been
approved in writing by each Rating Agency.
The Indenture Trustee may purchase or sell to itself or an Affiliate, as
principal or agent, the Eligible Investments described above.
"Eligible Repurchase Obligations" means repurchase obligations
with respect to any security that is a direct obligation of, or fully guaranteed
by, the United States of America or any agency or instrumentality thereof the
obligations of which are backed by the full faith and credit of the United
States of America, in either case entered into with a depository institution or
trust company (acting as principal) described in clauses (c)(ii) and (c)(iv) of
the definition of Eligible Investments.
"End-User" shall mean any party that uses the Financed Item
pursuant to an End-User Contract.
"End-User Contract" shall mean any CSA, Secured Note, Lease,
or other Financing Agreement covering Financed Items, originated or purchased by
the Originator.
"Equipment" means the tangible assets (including but not
limited to construction, road building, transportation, wood and pulp industry,
machine shop, printing, cranes and related equipment) financed or leased by an
Obligor pursuant to a Contract and the related security interest granted by such
Obligor in such assets.
"Event of Default" shall have the meaning specified in Section
5.01 of the Indenture.
"Excess Contract", as of any date of determination, means each
Contract selected by the Servicer in accordance with Section 11.01 at such time
as there shall have been discovered a breach of any of the representations and
warranties set forth in Section 3.05, the removal of which pursuant to Section
11.01 and the Originator's repurchase thereof or substitution of a Substitute
Contract therefor pursuant to Section 11.01, shall remedy such breach.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended or supplemented from time to time.
"Excluded Amounts" means (i) any collections on deposit in the
Collection Account or otherwise received by the Servicer on or with respect to
the Contracts
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Pool or related Equipment, which collections are attributable to any taxes, fees
or other charges imposed by any Governmental Authority, (ii) any collections
representing reimbursements of insurance premiums or payments for services that
were not financed by the Originator, (iii) other non-contract charges
reimbursable to the Servicer in accordance with the Servicer's customary
policies and procedures, and (iv) any collections with respect to repurchased or
expired Contracts.
"FDIC" shall mean the Federal Deposit Insurance Corporation,
or any successor thereto.
"Financed Items" means, with respect to a Contract, the
specifically identified Equipment and other property, together with all
accessions thereto, securing indebtedness of an Obligor under such Contract.
"Financing Agreement" means each financing agreement covering
Financed Items other than a CSA, a Secured Note or a Lease.
"Fitch" means Fitch IBCA, Inc. or any successor thereto.
"Governmental Authority" means the United States of America,
any state or other political subdivision thereof, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of, or
pertaining to, government.
"Highest Required Investment Category" means (i) with respect
to ratings assigned by Fitch (if such investment is rated by Fitch), F-1+ for
short-term instruments and AAA for long-term instruments, (ii) with respect to
ratings assigned by Xxxxx'x, A2 or P-1 for one month instruments, A1 or P-1 for
three month instruments, Aa3 or P-1 for six month instruments and Aaa or P-1 for
instruments with a term in excess of six months and (iii) with respect to
ratings assigned by S&P, A-1+ for short-term instruments and AAA for long-term
instruments.
"Holder" means (i) with respect to a Certificate, the Person
in whose name such Certificate is registered in the Certificate Register, and
(ii) with respect to a Note, the Person in whose name such Note is registered in
the Note Register.
"Indebtedness" means, with respect to any Person at any date,
(a) all indebtedness of such person for borrowed money or for the deferred
purchase price of property or services (other than current liabilities incurred
in the ordinary course of business and payable in accordance with customary
trade practices) or which is evidenced by a note, bond, debenture or similar
instrument, (b) all obligations of such Person under capital leases, (c) all
obligations of such Person in respect of acceptances issued or created for the
account of such Person, and (d) all liabilities secured by any Lien on any
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property owned by such Person even though such person has not assumed or
otherwise become liable for the payment thereof.
"Indenture" means the Indenture, dated as of the date hereof,
between the Trust and the Indenture Trustee.
"Indenture Trustee" means the Person acting as Indenture
Trustee under the Indenture, its successors in interest and any successor
trustee under the Indenture.
"Independent", when used with respect to any specified Person,
means such a Person who (i) is in fact independent of each of the Trust, the
Trust Depositor or the Servicer, (ii) is not a director, officer or employee of
any Affiliate of any of the Trust, the Trust Depositor or the Servicer, (iii) is
not a person related to any officer or director of any of the Trust, the Trust
Depositor or the Servicer or any of their respective Affiliates, (iv) is not a
holder (directly or indirectly) of more than 10% of any voting securities of any
of the Trust, the Trust Depositor or the Servicer or any of their respective
Affiliates, and (v) is not connected with any of the Trust, the Trust Depositor
or the Servicer as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions.
"Ineligible Contract" has the meaning specified in Section
11.01.
"Initial Class A-1 Principal Amount" means $ .
"Initial Class A-2 Principal Amount" means $ .
"Initial Class A-3 Principal Amount" means $ .
"Initial Class A-4 Principal Amount" means $ .
"Initial Class B Principal Amount" means $ .
"Initial Class C Principal Amount" means $ .
"Initial Contracts" means those Contracts conveyed to the
Trust on the Closing Date.
"Initial Cutoff Date" means November 1, 1999.
"Initial Principal Amount" means, when used in the context of
a reference to an individual Class of Notes, the initial class principal amount
applicable to such Class as defined above, and otherwise means, collectively,
the sum of the Initial Class X-0
00
00
Xxxxxxxxx Xxxxxx, the Initial Class A-2 Principal Amount, the Initial Class A-3
Principal Amount, the Initial Class A-4 Principal Amount, the Initial Class B
Principal Amount and the Initial Class C Principal Amount, i.e., $ .
"Insolvency Event" means, with respect to a specified Person,
(a) the filing of a decree or order for relief by a court having jurisdiction in
the premises in respect of such Person or any substantial part of its property
in an involuntary case under any applicable Insolvency Law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part of
its property, or ordering the winding-up or liquidation of such Person's
affairs, and such decree or order shall remain unstayed or undismissed and in
effect for a period of 60 consecutive days; or (b) the commencement by such
person of a voluntary case under any applicable Insolvency Law now or hereafter
in effect, or the consent by such person to the entry of an order for relief in
an involuntary case under such law, taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official for such Person
or for any substantial part of this property, or the making by such Person of
any general assignment for the benefit of creditors, or the failure by such
Person generally to pay its debts as such debts become due, or the taking of
action by such Person in furtherance of any of the foregoing.
"Insolvency Laws" means the Bankruptcy Code of the United
States of America and all other applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization,
suspension of payments, or similar debtor relief laws from time to time in
effect affecting the rights of creditors generally.
"Insolvency Proceeds" has the meaning specified in Section
10.01.
"Insurance Policy" means, with respect to any Contract, an
insurance policy covering physical damage to or loss of the related Equipment.
"Insurance Proceeds" means, depending on the context, any
amounts payable or any payments made, to the Servicer under any Insurance
Policy.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended from time to time.
"Investment Earnings" means the investment earnings (net of
losses and investment expenses) on amounts on deposit in the Collection Account
and the Reserve Fund, to be credited to the Collection Account on such
Distribution Date pursuant to Section 7.03.
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"Late Charges" means any late payment fees paid by Obligors in
accordance with the Servicer's customary policies.
"Lease" means each agreement, including financing agreements,
and, as applicable, schedules, subschedules, supplements and amendments to a
master lease, pursuant to which the Originator, as lessor, leased specified
assets to a Lessee at a specified monthly, quarterly, semiannual or annual
rental.
"Lessee" means, with respect to any Lease, the Obligor with
respect to such Lease.
"Lien" means any mortgage, deed of trust, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), equity interest, participation interest, preference, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever,
including, without limitation, any conditional sale or other title retention
agreement, and any financing lease having substantially the same economic effect
as any of the foregoing.
"Liquidation Expenses" means, with respect to any Contract,
the aggregate amount of all out-of-pocket expenses reasonably incurred by the
Servicer (including amounts paid to any subservicer) and any reasonably
allocated costs of internal counsel, in each case in accordance with the
Servicer's customary procedures in connection with the repossession,
refurbishing and disposition of any related Equipment upon or after the
expiration or earlier termination of such Contract and other out-of-pocket costs
related to the liquidation of any such Equipment, including the attempted
collection of any amount owing pursuant to such Contract if it is a Defaulted
Contract, but only to the extent gross recoveries with respect to such Contract
provide funds sufficient, after payment of all principal and accrued finance
charges due with respect to such Contract, to cover such expenses and costs.
"Liquidation Proceeds" means, with respect to a Defaulted
Contract, proceeds from the sale, lease or re-lease of the Equipment, proceeds
of the related Insurance Policy and any other recoveries with respect to such
Defaulted Contract and the related Equipment, net of Liquidation Expenses and
amounts, if any, so received that are required either to be refunded to the
Obligor on such Contract or paid to a third party other than the Originator.
"List of Contracts" means the list identifying each Contract
constituting part of the Trust Assets, which list shall consist of the initial
List of Contracts reflecting the Initial Contracts transferred to the Trust on
the Closing Date, together with any Subsequent List of Contracts amending the
most current List of Contracts reflecting the Substitute Contracts transferred
to the Trust on the related Subsequent Transfer Date (together with a deletion
from such list of the related Contract or Contracts identified on
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the corresponding Addition Notice with respect to which a Substitution Event has
occurred), and which list in each case (a) identifies each Contract included in
the Contracts Pool, and (b) sets forth as to each such Contract (i) the
Outstanding Principal Balance as of the applicable Cutoff Date, and (ii) the
maturity date, and which list (as in effect on the Closing Date) is attached to
this Agreement as Exhibit G.
"Material Modification" means a termination or release
(including pursuant to prepayment), or an amendment, modification or waiver, or
equivalent similar undertaking or agreement, by the Servicer with respect to a
Contract which would not otherwise be permitted under the standards and criteria
set forth in Sections 5.08 and/or 5.09 hereof, as applicable.
"Maturity Date" means, as applicable, the Class A-1 Maturity
Date, Class A-2 Maturity Date, Class A-3 Maturity Date, Class A-4 Maturity Date,
Class B Maturity Date or Class C Maturity Date.
"Monthly Delinquency Percentage" means with respect to any
Distribution Date, the percentage equivalent of a fraction, (a) the numerator of
which is the aggregate Principal Balance of all Contracts which are more than 90
days delinquent as of the last day of the immediately preceding Collection
Period, and (b) the denominator of which is the Pool Balance as of the last day
of the immediately preceding Collection Period.
"Monthly Principal Amount" means, with respect to a
Distribution Date, the difference between (i) the sum of the aggregate Principal
Amount of the Notes and the Overcollateralization Balance both as of the
immediately preceding Distribution Date (after making any principal payments on
such date) and (ii) the Pool Balance as of the last day of the related
Collection Period.
"Monthly Report" has the meaning specified in Section 9.01.
"Moody's" means Xxxxx'x Investors Service, Inc. or any
successor thereto.
"Note" means any one of the notes of the Trust of any Class
executed and authenticated in accordance with the Indenture.
"Note Distribution Account" means the account established and
maintained as such pursuant to Section 7.01.
"Note Register" has the meaning given such term in Section
2.04 of the Indenture.
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"Obligor" means, with respect to any Contract, the Person or
Persons obligated to make payments with respect to such Contract, including any
guarantor thereof.
"OCAI" has the meaning assigned such term in the preamble
hereto.
"OCAI Transfer Agreement" means the OCAI Transfer Agreement,
dated as of the date hereof, between OCAI and the Trust Depositor.
"Officer's Certificate" shall mean a certificate signed by any
officer of the Trust Depositor or the Servicer and delivered to the Owner
Trustee or the Indenture Trustee, as the case may be.
"Opinion of Counsel" means a written opinion of counsel, who
may be outside counsel, or internal counsel (except with respect to Federal
securities law (including the Trust Indenture Act) or tax law matters), for the
Trust Depositor or the Servicer and who shall be reasonably acceptable to the
Owner Trustee or the Indenture Trustee, as the case may be.
"Original Pool Balance" means the aggregate Principal Balance
of the Contracts transferred to the Trust as of November 1, 1999, equal to $ .
"Originator" means OCAI, in its capacity as Originator of a
Contract under this Agreement (including in respect of a Substitute Contract
pursuant to a Subsequent Purchase Agreement).
"Outstanding" has the meaning given such term in the
Indenture.
"Overcollateralization Balance" means, with respect to a
Distribution Date, an amount equal to the excess, if any, of (i) the Pool
Balance as of the last day of the related Collection Period over (ii) the
aggregate Principal Amount of the Notes as of such date after giving effect to
all principal payments made to the Noteholders on such date.
"Owner Trustee" means the Person acting, not in its individual
capacity, but solely as Owner Trustee, under the Trust Agreement, its successors
in interest and any successor owner trustee under the Trust Agreement.
"Paying Agent" means as described in Section 6.11 of the
Indenture and Section 3.10 of the Trust Agreement.
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"Permitted Liens" means (a) with respect to Contracts in the
Contracts Pool:
(i) Liens for state, municipal and other local taxes if such
taxes shall not at the time be due and payable or if the Trust
Depositor shall currently be contesting the validity thereof in good
faith by appropriate proceedings, (ii) Liens in favor of the Trust
Depositor created by the Originator and transferred to the Trust
pursuant hereto, (iii) Liens in favor of the Trust created pursuant to
this Agreement, and (iv) Liens in favor of the Indenture Trustee
created pursuant to the Indenture and/or this Agreement;
and (b) with respect to the related Equipment:
(i) materialmen's, warehousemen's, mechanics' and other liens
arising by operation of law in the ordinary course of business for sums
not due or sums which are being contested in good faith, (ii) Liens for
state, municipal and other local taxes if such taxes shall not at the
time be due and payable or if the Trust Depositor shall currently be
contesting the validity thereof in good faith by appropriate
proceedings, (iii) Liens in favor of the Trust Depositor created by the
Originator and transferred by the Trust Depositor to the Trust pursuant
to this Agreement, (iv) Liens in favor of the Trust created pursuant to
this Agreement, (v) Liens in favor of the Indenture Trustee created
pursuant to the Indenture and/or this Agreement, (vi) other liens which
are expressly subordinate to the prior payment of the Notes and the
Certificate on terms described herein, (vii) Liens granted by the
End-Users which are subordinate to the interest of the Trust in such
Equipment and (viii) Liens on items of Related Security in favor of the
Originator that arise by virtue of a blanket lien granted by an Obligor
to the Originator under a separate contract.
"Person" means any individual, corporation, estate,
partnership, business trust, limited liability company, sole proprietorship,
joint venture, association, joint stock company, trust (including any
beneficiary thereof), unincorporated organization or government or any agency or
political subdivision thereof or other entity.
"Pool Balance" means, with respect to a Distribution Date, an
amount equal to the aggregate remaining Principal Balance of the Contracts as of
the last day of the related Collection Period after giving effect to Defaulted
Contracts, Prepaid Contracts and Contracts subject to a warranty event.
"Prepaid Contract" means any Contract that has terminated or
been prepaid in full prior to its scheduled expiration date (including because
of a Casualty Loss), other than a Defaulted Contract.
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"Prepayment Amount" has the meaning specified in Section 5.09.
"Prepayments" means any and all partial and full prepayments
on a Contract (including, with respect to any Contract and any Collection
Period, any Scheduled Payment (or portion thereof) which is due in a subsequent
Collection Period which the Servicer has received, and (if such Contract is not
otherwise prepayable by its terms) expressly permitted the related Obligor to
make, in advance of its scheduled due date, and any and all cash proceeds or
rents realized from the sale, lease, re-lease or re-financing of Equipment under
a Prepaid Contract, net of Liquidation Expenses), Liquidation Proceeds, amounts
received in respect of Transfer Deposit Amounts and payments upon an optional
termination of the Trust pursuant to Section 7.08.
"Principal Amount" means, with respect to a Class of Notes,
the aggregate Initial Principal Amount thereof reduced by (i) the aggregate
amount of any distributions applied in reduction of such principal amount and
(ii) the aggregate amount of any distributions then on deposit in the Note
Distribution Account, if any, for such Class of Notes established in accordance
with the Indenture and to be applied in reduction of such principal amount in
accordance with such Indenture.
"Principal Balance" means, with respect to a Contract at any
time, the sum of the total remaining amounts of principal payable as of such
time to the Originator by the Obligor thereunder, exclusive of finance charges.
"Prospectus" has the meaning given such term in the
Underwriting Agreement.
"Qualified Eligible Investments" means Eligible Investments
acquired by the Indenture Trustee in its name and in its capacity as Indenture
Trustee at the written direction of the Issuer, which are held by the Indenture
Trustee in the Collection Account or the Reserve Fund and with respect to which
(a) the Indenture Trustee has noted its interest therein on its books and
records, and (b) the Indenture Trustee has purchased such investments at the
written direction of the Issuer for value without notice of any adverse claim
thereto (and, if such investments are securities or other financial assets or
interests therein, within the meaning of Section 8-102 of the UCC as enacted in
Illinois, without acting in collusion with a securities intermediary in
violating such securities intermediary's obligations to entitlement holders in
such assets, under Section 8-504 of such UCC, to maintain a sufficient quantity
of such assets in favor of such entitlement holders), and (c) either (i) such
investments are in the possession of the Indenture Trustee, or (ii) such
investments, (A) if certificated securities and in bearer form, have been
delivered to the Indenture Trustee, or in registered form, have been delivered
to the Indenture Trustee and either registered by the issuer in the name of the
Indenture Trustee or endorsed by effective endorsement to the Indenture Trustee
or in
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blank; (B) if uncertificated securities, the ownership of which has been
registered to the Indenture Trustee on the books of the issuer thereof (or
another person, other than a securities intermediary, either becomes the
registered owner of the uncertified security on behalf of the Indenture Trustee
or, having previously become the registered owner, acknowledges that it holds
for the Indenture Trustee); or (C) if securities entitlements (within the
meaning of Section 8-102 of the UCC as enacted in Illinois) representing
interests in securities or other financial assets (or interests therein) held by
a securities intermediary (within the meaning of said Section 8-102), a
securities intermediary indicates by book entry that a security or other
financial asset has been credited to the Indenture Trustee's securities account
with such securities intermediary. Any such Qualified Eligible Investment may be
purchased by or through the Indenture Trustee acting at the written direction
of the Issuer or any of its Affiliates.
"Qualified Institution" means (a) the corporate trust
department of the Indenture Trustee, or (b) a depository institution organized
under the laws of the United States of America or any one of the states thereof
or the District of Columbia (or any domestic branch of a foreign bank), (i) (A)
which has either (1) a long-term unsecured debt rating acceptable to the Rating
Agencies, or (2) a short-term unsecured debt rating or certificate of deposit
rating acceptable to the Rating Agencies, (B) the parent corporation of which
has either (1) a long-term unsecured debt rating acceptable to the Rating
Agencies, or (2) a short-term unsecured debt rating or certificate of deposit
rating acceptable to the Rating Agencies, or (C) is otherwise acceptable to the
Rating Agencies, and (ii) whose deposits are insured by the FDIC and have a
rating acceptable to the Rating Agencies.
"Rating Agency" means each of Xxxxx'x, S&P and Fitch, so long
as such Persons maintain a rating on the Notes and the Certificate; and if
either Moody's, S&P or Fitch no longer maintains a rating on the Notes and the
Certificate, such other nationally recognized statistical rating organization
selected by the Trust Depositor.
"Rating Agency Condition" means, with respect to any action or
series of related actions or proposed transaction or series of related proposed
transactions, that each Rating Agency shall have notified the Trust Depositor
and the Owner Trustee and the Indenture Trustee in writing that such action or
series of related actions or the consummation of such proposed transaction or
series of related transactions will not result in a Ratings Effect.
"Ratings Effect" means, with respect to any action or series
of related actions or proposed transaction or series of related proposed
transactions, a reduction or withdrawal of the rating of any outstanding Class
with respect to which a Rating Agency has previously issued a rating as a result
of such action or series of related actions or the consummation of such proposed
transaction or series of related transactions.
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"Record Date" means, with respect to a Distribution Date, the
calendar day immediately preceding a Distribution Date; provided, however, that
if Definitive Notes are issued, the Record Date shall be the last Business Day
of the preceding calendar month.
"Recoveries" means any and all recoveries on account of a
Defaulted Contract, including, without limitation, any and all cash proceeds or
rents realized from the sale, lease, re-lease or re-financing of repossessed
Equipment or other property, Insurance Proceeds, but in each case net of
Liquidation Expenses.
"Related Security" means, with respect to a Contract,
collateral in which a security interest has been granted or is held under or in
connection with such Contract, other than collateral which is a Financed Item.
"Released Amounts" means, with respect to any payment or
collection received with respect to any Contract on any Business Day (whether
such payment or collection is received by the Servicer, the Owner Trustee or the
Trust Depositor), an amount equal to that portion of such payment or collection
constituting Excluded Amounts.
"Required Holders" means (i) prior to the payment in full of
the Class A Notes Outstanding, Class A-1 Noteholders, Class A-2 Noteholders,
Class A-3 Noteholders and/or Class A-4 Noteholders evidencing more than 66 2/3%
of the Aggregate Principal Amount of all Class A Notes Outstanding, (ii) from
and after the payment in full of the Class A Notes Outstanding, Class B
Noteholders evidencing more than 66 2/3% of the Aggregate Principal Amount of
all Class B Notes Outstanding, and (iii) from and after the payment in full of
the Class B Notes Outstanding, Class C Noteholders evidencing more than 66 2/3%
of the Aggregate Principal Amount of all Class C Notes Outstanding.
"Required Reserve Amount" means, with respect to a
Distribution Date, an amount equal to the greater of (a) 3% of the Outstanding
Principal Amount of the Notes as of the last day of the immediately completed
Collection Period and (b) the lesser of (I) 1.0% of the Initial Principal Amount
of the Notes and (II) the Outstanding Principal Amount of the Notes as of the
last day of the related Collection Period.
"Requirements of Law" for any Person means the certificate of
incorporation or articles of association and by-laws or other organizational or
governing documents of such Person, and any law, treaty, rule or regulation, or
order or determination of an arbitrator or Governmental Authority, in each case
applicable to or binding upon such Person or to which such Person is subject,
whether Federal, state or local (including,
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without limitation, usury laws, the Federal Truth in Lending Act and Regulation
Z and Regulation B of the Board of Governors of the Federal Reserve System).
"Reserve Fund" means the Reserve Fund established and
maintained pursuant to Section 7.01 hereof.
"Reserve Fund Initial Deposit" means 1.5% of the Initial Note
Balance.
"Responsible Officer" means, with respect to the Owner
Trustee, any officer in its Corporate Trust Administration Department (or any
similar group of a successor Owner Trustee) and with respect to the Indenture
Trustee, has the meaning given to it in the Indenture.
"S&P" means Standard & Poor's Ratings Services, a division of
the XxXxxx-Xxxx companies.
"Scheduled Payment" means, with respect to any Contract, the
monthly or quarterly or semi-annual or annual rent or financing (whether
interest, principal or principal and interest) payment scheduled to be made by
the related Obligor under the terms of such Contract after the related Cutoff
Date and any such payment received after the related Cutoff Date; it being
understood that Scheduled Payments do not include any Excluded Amounts.
"Secured Note" means each promissory note with a related
security interest evidenced by written agreement, pursuant to which the
purchase of specified assets by an Obligor is financed or provided as collateral
security for specified monthly, quarterly, semiannual or annual payments.
"Securities" means the Notes and the Certificate, or any of
them.
"Securities Act" means the Securities Act of 1933, as amended
from time to time.
"Securityholders" means the Holders of the Notes or the
Certificate.
"Servicer" means initially OCAI, or its successor, until any
Servicer Transfer hereunder and thereafter means the Successor Servicer
appointed pursuant to Article VIII below with respect to the duties and
obligations required of the Servicer under this Agreement.
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"Servicer Advance" means, with respect to any Distribution
Date, the amounts, if any, deposited by the Servicer in the Collection Account
for such Distribution Date in respect of Scheduled Payments pursuant to Section
5.14.
"Servicer Default" shall have the meaning specified in Section
8.01.
"Servicing Fee" has the meaning specified in Section 5.18.
"Servicing Fee Percentage" means 1.00%.
"Servicer Transfer" has the meaning assigned in Section
8.02(a).
"Servicing Officer" means any officer of the Servicer involved
in, or responsible for, the administration and servicing of Contracts whose name
appears on a list of servicing officers appearing in an Officer's Certificate
furnished to the Indenture Trustee by the Servicer, as the same may be amended
from time to time.
"Solvent" means, as to any Person at any time, that (a) the
fair value of the Property of such Person is greater than the amount of such
Person's liabilities (including disputed, contingent and unliquidated
liabilities) as such value is established and liabilities evaluated for
purposes of Section 101(32) of the Bankruptcy Code; (b) the present fair
saleable value of the Property of such Person in an orderly liquidation of such
Person is not less than the amount that will be required to pay the probable
liability of such Person on its debts as they become absolute and matured; (c)
such Person is able to realize upon its Property and pay its debts and other
liabilities (including disputed, contingent and unliquidated liabilities) as
they mature in the normal course of business; (d) such Person does not intend
to, and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature; and (e) such
Person is not engaged in business or a transaction, and is not about to engage
in a business or a transaction, for which such Person's property would
constitute unreasonably small capital.
"Spread Event" means the occurrence of one or more of the
following: (a) OCAI is no longer acting as the Servicer; (b) the Three-Month
Delinquency Percentage calculated on the related distribution date is greater
than 5.00%; (c) the Cumulative Net Loss Percentage on the related Distribution
Date exceeds the "loss trigger percentage" set forth below:
LOSS TRIGGER
COLLECTION PERIOD PERCENTAGE
----------------- ----------
1st through, and including, the 11th Collection Period: 1.00%
12th through, and including, the 17th Collection Period: 1.25%
18th through, and including, the 23rd Collection Period: 1.50%
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24th Collection Period ongoing: 2.00%
Notwithstanding the foregoing: (i) the Spread Event referred
to in clause (b) above may be cured on any Distribution Date if the Three-Month
Delinquency Percentage for the preceding two Collection Periods is less than or
equal to 5.00% for two (2) Collection periods and (ii) the Spread Event
referenced in clause (b) may be cured if the Cumulative Net Loss Percentage is
less than the associated "loss trigger percentage" for that Collection Period.
"Spread Fund" means the Spread Fund established and maintained
pursuant to Section 7.01 hereof.
"Subsequent Cutoff Date" means the date specified as such for
Substitute Contracts in the related Subsequent Transfer Agreement.
"Subsequent List of Contracts" means a list, in the form of
the initial List of Contracts delivered on the Closing Date, but listing each
Substitute Contract transferred to the Trust pursuant to the related Subsequent
Transfer Agreement.
"Subsequent Purchase Agreement" means, with respect to any
Substitute Contracts, the agreement between the Originator and the Trust
Depositor pursuant to which the Originator will transfer the Substitute
Contracts to the Trust Depositor, the form of which is attached to hereto as
Exhibit J.
"Subsequent Transfer Agreement" means the agreement described
in Section 2.04 hereof.
"Subsequent Transfer Date" means any date on which Substitute
Contracts are transferred to the Trust.
"Substitute Contract" means a Contract that is (a) transferred
to the Trust under Section 2.04 with respect to which a related Substitution
Event has occurred with respect to a Contract or Contracts then held in the
Contracts Pool and identified in the related Addition Notice and (b) becomes
part of the Contracts Pool.
"Substitute Contract Qualification Conditions" means, with
respect to any Substitute Contract being transferred to the Trust pursuant to
Section 2.04, the accuracy of each of the following statements as of the related
Cutoff Date for such Contract:
(a) the aggregate Principal Balance of such Substitute
Contract is not less than that of the Contract or Contracts identified
on the related Addition Notice as the Contract or Contracts to be
released by the Trust to the Trust
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Depositor and reconveyed to the Originator in exchange for such
Substitute Contract; and
(b) for each separate Collection Period which corresponds to a
Collection Period in which a payment would have been owing on the
Contract or Contracts identified on the related Addition Notice as the
Contract or Contracts to be released by the Trust to the Trust
Depositor and reconveyed to the Originator in exchange for such
Substitute Contract, the amount in respect of Scheduled Payments
receivable (assuming Scheduled Payments are paid and received when due)
on the Substitute Contract in such Collection Period is not less than
that of such related Contract or Contracts;
(c) the weighted average life of the Substitute Contract is
similar to the weighted average life of the Contract or Contracts
identified on the related Addition Notice as the Contract or
Contracts to be released by the Trust to the Trust Depositor and
reconveyed to the Originator in exchange for such Substitute Contract;
(d) the weighted average yield (annual percentage rate or
APR) is not less than the yield (APR) on the Contract or Contracts
identified on the related Addition Notice as the Contract or Contracts
to be released by the Trust to the Trust Depositor and reconveyed to
the Originator in exchange for such Substitute Contract; and
(e) if, instead of such Substitute Contract being added to the
Contracts Pool on the related Subsequent Transfer Date, such Substitute
Contract had instead been included in the Contracts Pool as of the
Initial Cutoff Date, and the related Contract or Contracts identified
on the related Addition Notice were not so included (and assuming such
hypothetical inclusion satisfied the criteria set forth in clause (a)
and (b) above that would have been applicable at such time), the
representations of the Originator set forth in Section 3.05(a)(i)-(iv)
concerning concentrations would not, as a result of such inclusion,
have become inaccurate or incorrect in any material respect; and
(f) no adverse selection procedure shall have been employed in
the selection of such Substitute Contract from the Originator's
portfolio;
(g) all actions or additional actions (if any) necessary to
perfect the security interest and assignment of such Substitute
Contract and related Equipment to the Trust Depositor, Trust, and
Indenture Trustee shall have been taken as of or prior to the
Subsequent Transfer Date; and
(h) the maturity date for the last Scheduled Payment due under
such Substitute Contract is not later than the Class B Maturity Date.
"Substitution Event" shall have occurred if one or more
Contracts then held in the Trust and identified in the related Addition Notice
is either (a) a Prepaid Contract, (b) a Contract that becomes subject to a
Material Modification, (c) a Defaulted Contract, (d) an Excess Contract or (e)
the subject of a breach of a representation or warranty under this Agreement or
other provision which breach or other provision, in the absence of a
substitution of a Substitute Contract for such Contract or Contracts pursuant to
Section 2.04, would require the payment of a Transfer Deposit Amount to the
Trust in respect of such Contract pursuant to Section 11.01; provided, however,
that no Substitution Event shall be deemed to occur under clause (a) (if related
to a Casualty
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Loss), (b) or (c) to the extent Contracts having initial aggregate Principal
Amounts of 10% or greater of the Original Pool Balance have previously been
substituted for under such clauses and provided further, that no Substitution
Event shall be deemed to occur under clause (a) (other than related to a
Casualty Loss), (d) or (e) to the extent (i) Contracts having initial aggregate
Principal Amounts of 20% or greater of the Original Pool Balance have previously
been substituted under such clauses or (ii) the Class A-1 Notes are Outstanding.
"Successor Servicer" has the meaning given such term in
Section 8.02(b).
"Tax Opinion" means, with respect to any action, an Opinion of
Counsel to the effect that, for federal income tax purposes, (i) following such
action the Trust will not be deemed to be an association (or publicly traded
partnership) taxable as a corporation, (ii) following such action the Trust will
be disregarded as a separate entity from the Trust Depositor, and (iii) such
action will not affect the tax characterization as debt of Notes of any
outstanding Class issued by the Trust for which an Opinion of Counsel has been
provided that such Notes are debt.
"Three-Month Delinquency Percentage" means with respect to any
Distribution Date commencing with the third Distribution Date, the percentage
equivalent of a fraction, (a) the numerator of which is the sum of the Monthly
Delinquency Percentages for such Distribution Date and the two immediately
preceding Distribution Dates, and (b) the denominator of which is three.
"Transaction Documents" means this Agreement, the Indenture,
the Trust Agreement, the Administration Agreement, the OCAI Transfer Agreement,
any Subsequent Transfer Agreement, any Subsequent Purchase Agreement and the
Underwriting Agreement.
"Transfer Date" means the Business Day immediately preceding
each Distribution Date.
"Transfer Deposit Amount" means, with respect to each
Ineligible Contract or Excess Contract, on any date of determination, the sum of
the Principal Balances of such Contracts, together with accrued interest thereon
through such date of determination at the interest rate provided for thereunder,
and any outstanding Servicer Advances thereon that have not been waived by the
Servicer entitled thereto.
"Trust" means the trust created by the Trust Agreement and
funded pursuant to this Agreement, consisting of the Trust Assets.
"Trust Account Property" means the Trust Accounts, all amounts
and investments held from time to time in any Trust Account (whether in the form
of deposit
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accounts, physical property, book-entry securities, uncertificated securities or
otherwise), including without limitation the Reserve Fund Initial Deposit, and
all proceeds of the foregoing.
"Trust Accounts" means, collectively, the Collection Account,
the Reserve Fund and the Note Distribution Account, or any of them.
"Trust Agreement" means the Amended and Restated Trust
Agreement, dated as of the date hereof, between the Trust Depositor and the
Owner Trustee.
"Trust Assets" has the meaning given to such term in Section
2.01(b) hereof (and in Section 2.04(a) hereof in respect of Substitute Contracts
and related assets transferred to the Trust pursuant to Subsequent Transfer
Agreements).
"Trust Depositor" has the meaning assigned such term in the
preamble hereunder, or any successor entity thereto.
"Trust Estate" shall have the meaning specified in the Trust
Agreement.
"Trustees" means the Owner Trustee and the Indenture Trustee,
or any of them individually as the context may require.
"UCC" means the Uniform Commercial Code as enacted in New
Jersey; provided, however, in the event that, by reason of mandatory provisions
of law, any and all of the attachment, perfection or priority of the Lien of the
Trust in and to the Trust Assets or the Lien of the Indenture Trustee in and to
the Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New Jersey, the term UCC shall mean the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such attachment, perfection or priority and
for purposes of definitions related to such provisions.
"UCC Filing Locations" means the States of New Jersey and
Delaware.
"Uncollectible Advance" means with respect to any
Determination Date and any Contract, the amount, if any, advanced by the
Servicer pursuant to Section 5.14 which the Servicer has as of such
Determination Date determined in good faith will not be ultimately recoverable
by the Servicer.
"Underwriting Agreement" means the Underwriting Agreement,
dated November , 1999, among First Union Securities, Inc. (as an
underwriter thereunder), the Trust Depositor, and OCAI.
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"United States" means the United States of America.
"Unreimbursed Servicer Advances" means, at any time, the
amount of all previous Servicer Advances (or portions thereof) as to which the
Servicer has not been reimbursed as of such time pursuant to Sections 7.01 or
7.05 and which the Servicer has determined in its sole discretion are
Uncollectible Advances, and with respect to which the Servicer has given a
written certification to such effect to each Trustee.
"Vendor" means, with respect to a Contract, the equipment
manufacturer, dealer or distributor, or other Person that provided financing
under such Contract in connection with the acquisition or use by an End-User of
such party's Equipment or other products.
"Vendor Assignment" means each assignment agreement pursuant
to which an individual End-User Contract originated by a Vendor is assigned to
the Originator.
"Vice President" of any Person means any vice president of
such Person, whether or not designated by a number or words before or after the
title "Vice President," who is a duly elected officer of such Person.
SECTION 1.02. USAGE OF TERMS. With respect to all terms in
this Agreement, the singular includes the plural and the plural the singular;
words importing any gender include the other genders; references to "writing"
include printing, typing, lithography and other means of reproducing words in a
visible form; references to agreements and other contractual instruments include
all amendments, modifications and supplements thereto or any changes therein
entered into in accordance with their respective terms and not prohibited by
this Agreement; references to Persons include their permitted successors and
assigns; and the term "including" means "including without limitation."
SECTION 1.03. SECTION REFERENCES. All section references,
unless otherwise indicated, shall be to Sections in this Agreement.
SECTION 1.04. CALCULATIONS. Except as otherwise provided
herein, all interest rate and basis point calculations hereunder will be made on
the basis of a 360-day year and twelve 30-day months and will be carried out to
at least three decimal places.
SECTION 1.05. ACCOUNTING TERMS. All accounting terms used but
not specifically defined herein shall be construed in accordance with generally
accepted accounting principles in the United States.
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ARTICLE TWO
ESTABLISHMENT OF TRUST; TRANSFER OF CONTRACT ASSETS
SECTION 2.01. CREATION AND FUNDING OF TRUST; TRANSFER OF
CONTRACT ASSETS. (a) The Trust shall be created pursuant to the terms and
conditions of the Trust Agreement, upon the execution and delivery of the Trust
Agreement and the filing by the Owner Trustee of an appropriately completed
Certificate of Trust (as defined in the Trust Agreement) under the Business
Trust Statute. The Trust Depositor, as settlor of the Trust, shall fund and
convey assets to the Trust pursuant to the terms and provisions hereof. The
Trust shall be administered pursuant to the provisions of this Agreement, the
Administration Agreement and the Trust Agreement for the benefit of the
Noteholders and Certificateholder. The Owner Trustee is hereby specifically
recognized by the parties hereto as empowered to conduct business dealings on
behalf of the Trust in accordance with the terms hereof and of the Trust
Agreement.
(b) Subject to and upon the terms and conditions set forth
herein, the Trust Depositor hereby sells, transfers, assigns, sets over and
otherwise conveys to the Trust, for a purchase price of $ in cash (less
underwriting expenses and certain other expenses associated with the initial
offer and sale of the Notes the proceeds of which represent the consideration
paid by the Trust herein), all the right, title and interest of the Originator
in and to (items (i) - (vi) below, being collectively referred to herein as the
"Contract Assets"):
(i) the Initial Contracts, and all monies received in
payment of such Contracts on and after the Initial Cutoff Date, any
Prepayment Amounts, any payments in respect of a casualty or early
termination, and any Recoveries received with respect thereto, but
excluding any Excluded Amounts;
(ii) the Equipment related to such Contracts,
including the security interest of the Trust Depositor in such
Equipment and all proceeds from any sale or other disposition of such
Equipment (but subject to the exclusion and release herein of Excluded
Amounts);
(iii) the Contract Files;
(iv) all payments made or to be made in the future
with respect to such Contracts or the Obligor thereunder under any
Vendor Assignments and under any guarantee or similar credit
enhancement with respect to such Contracts;
(v) all Insurance Proceeds with respect to each such
Contract; and
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(vi) all income from and proceeds of the foregoing.
In addition to the Contract Assets, the Trust Depositor hereby sells, transfers,
assigns, sets over and otherwise conveys to the Trust the remittances, deposits
and payments made into the Trust Accounts from time to time, amounts in the
Trust Accounts from time to time (and any investments of such amounts) and all
proceeds and products of the foregoing, which together with the Contract Assets
constitute the corpus of the Trust and are referred to as the "Trust Assets").
(c) The Originator and the Trust Depositor acknowledge that
the representations and warranties of the Originator in Section 3.01, 3.02,
3.03, 3.04 and 3.05 applicable to the Substitute Contracts will run to and be
for the benefit of the Trust and the Trustees and the Trust and the Trustees may
enforce directly without joinder of Trust Depositor, the repurchase obligations
of the Originator with respect to breaches of such representations and
warranties as set forth herein and in Section 11.01.
(d) The sale, transfer, assignment, set-over and conveyance of
the Trust Assets by the Trust Depositor to the Trust pursuant to this Agreement
does not constitute and is not intended to result in a creation or an assumption
by the Trust Depositor or the Trust of any obligation of the Originator in
connection with the Contract Assets, or any agreement or instrument relating
thereto, including, without limitation, any obligation to any Obligor or
End-User, if any, not financed by the Originator, or (1) any taxes, fees, or
other charges imposed by any Governmental Authority and (2) any insurance
premiums which remain owing with respect to any Contract at the time such
Contract is sold hereunder.
(e) The Originator, Trust Depositor and Trust intend and agree
that (i) the transfer of the Contract Assets to the Trust Depositor and the
transfer of the Trust Assets to the Trust are intended to be a sale, conveyance
and transfer of ownership of the Contract Assets and Trust Assets, as the case
may be, rather than the mere granting of a security interest to secure a
borrowing and (ii) such Contract Assets and Trust Assets shall not be part of
the Originator's or the Trust Depositor's estate in the event of a filing of a
bankruptcy petition or other action by or against such Person under any
Insolvency Law. In the event, however, that notwithstanding such intent and
agreement, such transfers are deemed to be of a mere security interest to secure
indebtedness, the Originator shall be deemed to have granted the Trust Depositor
and the Trust Depositor shall be deemed to have granted the Trust, as the case
may be, a perfected first priority security interest in such Contract Assets or
Trust Assets respectively and this Agreement shall constitute a security
agreement under applicable law, securing the repayment of the purchase price
paid hereunder and the obligations and/or interests represented by the
Securities, in the order and priorities, and subject to the other terms and
conditions of, this Agreement, the
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Indenture and the Trust Agreement, together with such other obligations or
interests as may arise hereunder and thereunder in favor of the parties hereto
and thereto.
If any such transfer of the Contract Assets is deemed to be
the mere granting of a security interest to secure a borrowing, the Trust
Depositor may, to secure the Trust Depositor's own borrowing under this
Agreement (to the extent that the transfer of the Contract Assets thereunder is
deemed to be a mere granting of a security interest to secure a borrowing)
repledge and reassign (1) all or a portion of the Contract Assets pledged to
Trust Depositor by the Originator and with respect to which the Trust Depositor
has not released its security interest at the time of such pledge and
assignment, and (2) all proceeds thereof. Such repledge and reassignment may be
made by Trust Depositor with or without a repledge and reassignment by Trust
Depositor of its rights under any agreement with the Originator, and without
further notice to or acknowledgment from the Originator. The Originator waives,
to the extent permitted by applicable law, all claims, causes of action and
remedies, whether legal or equitable (including any right of setoff), against
Trust Depositor or any assignee of Trust Depositor relating to such action by
Trust Depositor in connection with the transactions contemplated by this
Agreement.
SECTION 2.02. CONDITIONS TO TRANSFER OF TRUST ASSETS TO TRUST.
On or before the Closing Date, the Originator or the Trust Depositor, as
applicable, shall deliver or cause to be delivered to the Owner Trustee and
Indenture Trustee each of the documents, certificates and other items as
follows:
(i) A certificate of an officer of the Originator
substantially in the form of Exhibit C hereto;
(ii) Opinions of counsel for the Originator and the
Trust Depositor substantially in the form of Exhibits D and E hereto
(and including as an addressee thereof each Rating Agency);
(iii) Copies of resolutions of the Board of Directors
of the Originator or of the Executive Committee of the Board of
Directors of the Originator approving the execution, delivery and
performance of this Agreement and the transactions contemplated
hereunder, certified in each case by the Secretary or an Assistant
Secretary of the Originator;
(iv) Officially certified recent evidence of due
incorporation and good standing of the Originator under the laws of New
York;
(v) The initial List of Contracts, certified by the
Chairman of the Board, President or any Vice President of the Trust
Depositor, together with
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an Assignment substantially in the form of Exhibit A (along with the
delivery of any instruments as required under Section 2.06 below);
(vi) A certificate of an officer of the Trust
Depositor substantially in the form of Exhibit B hereto;
(vii) A letter from Xxxxxx Xxxxxxxx LLP, or another
nationally recognized accounting firm, addressed to the Originator and
the Trust Depositor, stating that such firm has reviewed a sample of
the Initial Contracts and performed specific procedures for such sample
with respect to certain contract terms and which identifies those
Initial Contracts which do not conform;
(viii) Copies of resolutions of the Board of
Directors of the Servicer and the Trust Depositor or of the Executive
Committee of the Board of Directors of the Servicer and the Trust
Depositor approving the execution, delivery and performance of this
Agreement and the other Transaction Documents to which any of them is a
party, as applicable, and the transactions contemplated hereunder and
thereunder, certified in each case by the Secretary or an Assistant
Secretary of the Servicer and the Trust Depositor;
(ix) Officially certified, recent evidence of due
incorporation and good standing of the Trust Depositor under the laws
of Delaware;
(x) Evidence of proper filing with appropriate
offices in the UCC Filing Locations in the State of New Jersey of UCC
financing statements executed by the Originator, as debtor, naming the
Trust Depositor as secured party (and the Owner Trustee as assignee)
and identifying the Contract Assets as collateral; and evidence of
proper filing with appropriate officer in the UCC Filing Locations in
the State of New Jersey of UCC financing statements executed by the
Trust Depositor, as debtor, naming the Owner Trustee as secured party
(and the Indenture Trustee as assignee) and identifying the Trust
Assets as collateral; and evidence of proper filing with appropriate
officers in the UCC Filing Locations in the State of Delaware of UCC
financing statements executed by the Trust and naming the Indenture
Trustee as secured party and identifying the Collateral, as collateral;
(xi) An Officer's Certificate listing the Servicer's
Servicing Officers;
(xii) Evidence of deposit in the Collection Account
of all funds received with respect to the Initial Contracts after the
Initial Cutoff Date to the
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date two days preceding the Closing Date, together with an Officer's
Certificate from the Servicer to the effect that such amount is
correct;
(xiii) Evidence of deposit in the Reserve Fund of the
Reserve Fund Initial Deposit by the Trust Depositor;
(xiv) A fully executed Trust Agreement;
(xv) A fully executed Administration Agreement;
(xvi) A fully executed Indenture;
(xvii) A fully executed OCAI Transfer Agreement;
(xviii) An opinion of Xxxxxxxx & Xxxxxxxx to the
effect that for federal income tax purposes, the Class A Notes, Class B
Notes and Class C Notes will be characterized as debt and the Trust
will not be characterized as an association (or publicly traded
partnership) taxable as a corporation; and
(xix) An opinion of Xxxxx, Danzig, Scherer, Xxxxxx
and Xxxxxxxx to the effect that for New Jersey tax purposes, the Trust
will not be subject to the New Jersey Corporation Income Tax or the New
Jersey Corporation Business Tax.
SECTION 2.03. ACCEPTANCE BY OWNER TRUSTEE. On the Closing
Date, if the conditions set forth in Section 2.02 have been satisfied, the Trust
shall issue to, or upon the order of, the Trust Depositor the Certificate
representing ownership of a beneficial interest in 100% of the Trust and the
Trust shall issue, and the Indenture Trustee shall authenticate, to, or upon the
order of, the Trust Depositor the Notes secured by the Collateral. The Owner
Trustee hereby acknowledges its acceptance, on behalf of the Trust, of the Trust
Assets, and declares that it shall maintain such right, title and interest in
accordance with the terms of this Agreement and the Trust Agreement upon the
trust herein and therein set forth.
SECTION 2.04. CONVEYANCE OF SUBSTITUTE CONTRACTS.
(a) Conveyance of Substitute Contracts to the Trust Depositor.
Subject to Sections 2.01(d) and (e) above and the satisfaction of the conditions
set forth in paragraph (c) below, the Originator may at its option (but shall
not be obligated to) sell, transfer, assign, set over and otherwise convey to
the Trust Depositor (by delivery of an executed Subsequent Purchase Agreement
substantially in the form attached as Exhibit J hereto), without recourse other
than as expressly provided herein and therein (and the
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Trust Depositor shall be required to purchase through payment by exchange of one
or more related Contracts released by the Trust to the Trust Depositor on the
Subsequent Transfer Date), all the right, title and interest of the Originator
in and to (the property in clauses (i)-(vi) below, upon such transfer, becoming
part of the "Contract Assets"):
(i) the Substitute Contracts identified in the
related Addition Notice, and all monies received in payment of such
Substitute Contracts on and after the related Subsequent Cutoff Dates,
any Prepayment Amounts, any payments in respect of a casualty or early
termination, and any Recoveries received with respect thereto, but
excluding any Excluded Amounts;
(ii) the Equipment related to such Contracts,
including the security interest of the Trust Depositor in such
Equipment and all proceeds from any sale or other disposition of such
Equipment (but subject to the exclusion and release herein of Excluded
Amounts);
(iii) the Contract Files;
(iv) all payments made or to be made in the future
with respect to such Contracts or the Obligor thereunder under any
Vendor Assignments with the Originator and under any guarantee or
similar credit enhancement with respect to such Contracts;
(v) all Insurance Proceeds with respect to each such
Contract; and
(vi) all income from and proceeds of the foregoing.
(b) Subject to Sections 2.01(d) and (e) above and the
conditions set forth in paragraph (c) below, the Trust Depositor shall sell,
transfer, assign, set over and otherwise convey to the Trust, without recourse
other than as expressly provided herein and therein, (i) all the right, title
and interest of the Trust Depositor in and to the Substitute Contracts purchased
pursuant to Section 2.04(a) above, and (ii) all other rights and property
interests consisting of Contract Assets related to such Substitute Contracts
(the property in clauses (i)-(ii) above, upon such transfer, becoming part of
the "Trust Assets").
(c) The Originator and Trust Depositor shall transfer to the
Trust the Substitute Contracts and the other property and rights related thereto
described in paragraphs (a), in the case of the Originator, or (b), in the case
of the Trust Depositor, above only upon the satisfaction of each of the
following conditions on or prior to the
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related Subsequent Transfer Date (and the delivery of a related Addition Notice
by the Trust Depositor shall be deemed a representation and warranty by the
Trust Depositor and of the Originator, that such conditions have been or will
be, as of the related Subsequent Transfer Date, satisfied):
(i) the Trust Depositor shall have provided the Owner
Trustee and the Indenture Trustee with a timely Addition Notice
complying with the definition thereof contained herein, which Notice
shall in any event be no later than five days prior to the date of
addition;
(ii) there shall have occurred, with respect to each
such Substitute Contract, a corresponding Substitution Event with
respect to one or more Contracts then in the Contracts Pool;
(iii) the Substitute Contract(s) being conveyed to
the Trust, satisfy the Substitute Contract Qualification Conditions;
(iv) the Originator shall have delivered to the Trust
Depositor a duly executed written assignment in substantially the form
of Exhibit J hereto (the "Subsequent Purchase Agreement"), which shall
include a Subsequent List of Contracts listing the Substitute
Contracts;
(v) the Trust Depositor shall have delivered to the
Owner Trustee a duly executed written assignment (including an
acceptance by the Owner Trustee) in substantially the form of Exhibit I
hereto (the "Subsequent Transfer Agreement"), which shall include a
Subsequent List of Contracts listing the Substitute Contracts;
(vi) the Trust Depositor shall have deposited or
caused to be deposited in the Collection Account all Collections
received with respect to the Substitute Contracts on or after the
related Subsequent Cutoff Date;
(vii) as of each Subsequent Transfer Date, neither
the Originator nor the Trust Depositor was insolvent nor will either of
them have been made insolvent by such transfer nor is either of them
aware of any pending insolvency;
(viii) no selection procedures believed by the
Originator or the Trust Depositor to be adverse to the interests of the
Noteholders or Certificateholder shall have been utilized in selecting
the Substitute Contracts;
(ix) each of the representations and warranties made
by the Originator pursuant to Sections 3.02, 3.03, 3.04, and 3.05
applicable to the
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Substitute Contracts shall be true and correct as of the related
Subsequent Transfer Date (provided that with respect to clause (c) of
the definition of Substitute Contract Qualification Conditions the
representations shall be true and correct as of the Initial Cut-Off
Date), and the Originator shall have performed all obligations to be
performed by it hereunder on or prior to such Subsequent Transfer Date;
(x) the Originator shall, at its own expense, on or
prior to the Subsequent Transfer Date, indicate in its Computer Records
that ownership of the Substitute Contracts identified on the Subsequent
List of Contracts in the Subsequent Transfer Agreement has been sold to
the Trust through the Trust Depositor pursuant to this Agreement; and
(xi) the aggregate Principal Balance of all Substitute
Contracts that shall be substituted for Defaulted Contracts and,
Contracts subject to a Material Modification cannot exceed 10% of the
Original Pool Balance.
(xii) the aggregate Principal Balance of all Substitute
Contracts that shall be substituted for Prepaid Contracts that relate
to a Casualty Loss cannot exceed 20% of the Original Pool Balance.
SECTION 2.05. RELEASE OF RELEASED AMOUNTS. (a) The Indenture
Trustee hereby agrees to release to the Trust from the Trust Assets, and the
Trust hereby agrees to release to the Trust Depositor, an amount equal to the
Released Amounts immediately upon identification thereof and upon receipt of an
Officer's Certificate of the Servicer, which release shall be automatic and
shall require no further act by the Indenture Trustee or the Trust, provided
that the Indenture Trustee or Owner Trustee shall execute and deliver such
instruments of release and assignment, or otherwise confirm the foregoing
release, as may reasonably be requested by the Trust Depositor in writing Upon
such release, such Released Amounts shall not constitute and shall not be
included in the Trust Assets.
(b) Immediately upon the release to the Trust Depositor by
the Indenture Trustee of the Released Amounts, the Trust Depositor hereby
irrevocably agrees to release to the Originator such Released Amounts, which
release shall be automatic and shall require no further act by the Trust
Depositor, provided, that the Trust Depositor shall execute and deliver such
instruments of release and assignment, or otherwise confirming the foregoing
release of any Excluded Amounts, as may be reasonably requested by the
Originator.
SECTION 2.06. DELIVERY OF INSTRUMENTS. The Originator and the
Trust Depositor shall deliver possession of all "instruments" (within the
meaning of Article 9 of the UCC) not constituting part of "chattel paper"
(within the meaning of such Article 9), which evidence any Contract to the Owner
Trustee on behalf of the Trust on the Closing Date (or, if applicable, on the
relevant Subsequent Transfer Date), in each case endorsed in blank without
recourse. Pursuant to Section 3.05 of the Indenture, the Trust is required to
deliver such instruments to the Indenture Trustee as pledgee under the
Indenture. Accordingly, the Trust hereby authorizes and directs the Originator
and the Trust Depositor to deliver possession of any such instruments to the
Indenture Trustee on
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behalf of and for the account of the Trust, and agrees that such delivery shall
satisfy the condition set forth in the first sentence of this Section 2.06. The
Originator and the Trust Depositor shall also identify on the List of Contracts
(including any deemed amendment thereof associated with any Substitute
Contracts), whether by attached schedule or marking or other effective
identifying designation, all Contracts which are or are evidenced by such
instruments.
ARTICLE THREE
REPRESENTATIONS AND WARRANTIES
The Originator makes, and upon execution of each Subsequent
Purchase Agreement is deemed to make, the following representations and
warranties, on which the Trust Depositor will rely in conveying the Contract
Assets on the Closing Date (and on any Subsequent Transfer Date) to the Trust,
and on which the Trust, the Noteholders and Certificateholder will rely. The
Trust Depositor acknowledges that such representations and warranties are being
made by the Originator for the benefit of the Trust.
Such representations and warranties speak as of the execution
and delivery of this Agreement and as of the Closing Date (or Subsequent
Transfer Date, as applicable), but shall survive the sale, transfer and
assignment of the Contract Assets to the Trust. The repurchase obligation or
substitution obligation of the Originator set forth in Section 11.01
constitutes the sole remedy available for a breach of a representation or
warranty of the Originator set forth in Sections 3.01 3.02, 3.03, 3.04 or 3.05
of this Agreement. Notwithstanding the foregoing, the Originator shall not be
deemed to be remaking any of the representations set forth in Section 3.03 or
3.05 on a Subsequent Transfer Date with respect to the Substitute Contracts, as
such representations relate solely to the composition of the Initial Contracts
conveyed on the Closing Date, provided, that any inaccurate representation as
to concentrations contained in any Addition Notice shall be subject to the same
remedies hereunder as if such representation were made under Section 3.05 on
the Closing Date with respect to an Initial Contract.
SECTION 3.01. REPRESENTATIONS AND WARRANTIES REGARDING THE
ORIGINATOR. By its execution of this Agreement and each Subsequent Purchase
Agreement, the Originator represents and warrants that:
(a) ORGANIZATION AND GOOD STANDING. The Originator is
a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization and has the
requisite corporate power to own or lease its assets and to transact
the business in which it is currently engaged. The Originator is duly
qualified to do business as a foreign corporation and is in good
standing in each jurisdiction in which the character of the business
transacted by it
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or properties owned or leased by it requires such qualification and in
which the failure so to qualify would have a material adverse effect on
the business, properties, assets, or condition (financial or otherwise)
of the Originator or Trust Depositor. The Originator is properly
licensed in each jurisdiction to the extent required by the laws of
such jurisdiction in order to originate, and (if the Originator is to
be the Servicer) service the Contracts in accordance with the terms of
this Agreement.
(b) AUTHORIZATION; BINDING OBLIGATION. The Originator
has the power and authority to make, execute, deliver and perform this
Agreement and the other Transaction Documents to which the Originator
is a party and all of the transactions contemplated under this
Agreement and the other Transaction Documents to which the Originator
is a party, and has taken all necessary corporate action to authorize
the execution, delivery and performance of this Agreement and the other
Transaction Documents to which the Originator is a party. This
Agreement and the other Transaction Documents to which the Originator
is a party constitute the legal, valid and binding obligation of the
Originator enforceable in accordance with their terms, except as
enforcement of such terms may be limited by bankruptcy, insolvency or
similar laws affecting the enforcement of creditors' rights generally
and by the availability of equitable remedies.
(c) NO CONSENT REQUIRED. The Originator is not
required to obtain the consent of any other party or any consent,
license, approval or authorization from, or registration or
declaration with, any governmental authority, bureau or agency in
connection with the execution, delivery, performance, validity or
enforceability of this Agreement and the other Transaction Documents to
which the Originator is a party.
(d) NO VIOLATIONS. The Originator's execution,
delivery and performance of this Agreement and the other Transaction
Documents to which the Originator is a party will not violate any
provision of any existing law or regulation or any order or decree of
any court or the Certificate of Incorporation or Bylaws of the
Originator, or constitute (with or without notice or lapse of time or
both) a material breach of any mortgage, indenture, contract or other
agreement to which the Originator is a party or by which the Originator
or any of the Originator's properties may be bound.
(e) LITIGATION. No litigation or administrative
proceeding of or before any court, tribunal or governmental body is
currently pending, or to the knowledge of the Originator threatened,
against the Originator or any of its respective properties or with
respect to this Agreement or any other Transaction Document to which
the Originator is a party which, if adversely determined,
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would in the opinion of the Originator have a material adverse effect
on the business, properties, assets or condition (financial or other)
of the Originator or the transactions contemplated by this Agreement or
any other Transaction Document to which the Originator is a party.
(f) PLACE OF BUSINESS; NO CHANGES; NO TRADE NAMES.
The Originator's sole place of business or chief executive office
(within the meaning of Article 9 of the UCC) is as set forth in Section
13.04 below. The Originator has not changed its name as set forth
herein, whether by amendment of its Certificate of Incorporation, by
reorganization or otherwise, and has not changed the location of its
chief executive office, within the four months preceding the Closing
Date (or Subsequent Transfer Date, as applicable, except in accordance
with the requirements of Section 4.03). The legal name of the
Originator is as set forth in this Agreement and, within the five years
preceding the Closing Date, the Originator has not used, and currently
does not use, any trade names, fictitious names, assumed names, or
"doing business as" names.
(g) NO BULK SALES. The execution, delivery and
performance of this Agreement by the Originator does not require
compliance with any "bulk sales" laws by the Originator.
(h) SOLVENCY. The Originator on each date of and,
after giving effect to the transfer of the Contracts and any Substitute
Contracts, as the case may be, to the Trust Depositor pursuant to the
transfer agreement, dated as of the date hereof, between the Originator
and the Trust Depositor, is Solvent.
(i) USE OF PROCEEDS. No proceeds of the sale of any
Initial Contract or Substitute Contract hereunder received by the
Originator will be used by the Originator to purchase or carry any
"margin stock" as such term is defined in Regulation G, T, U or X of
the Board of Governors of the Federal Reserve System.
(j) NOT AN INVESTMENT COMPANY. The Originator is not
an "investment company" within the meaning of the Investment Company
Act of 1940, as amended (or the Originator is exempt from all
provisions of such Act).
(k) TAXES. To the best of the Originator's knowledge,
(i) the Originator has filed all tax returns required to be filed in
the normal course of its business and has paid or made adequate
provisions for the payment of all taxes, assessments and other
governmental charges due from the Originator or is
contesting any such tax, assessment or other governmental charge in
good faith through appropriate proceedings, (ii) no tax lien has been
filed with respect
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thereto, and (iii) no claim is being asserted with respect to any such
tax, fee or other charge.
(l) SALE TREATMENT. The Originator has treated the
transfer of Contract Assets to the Trust Depositor for all purposes
(including financial accounting purposes) as a sale and purchase on all
of its relevant books, records, financial statements and other
applicable documents, except to the extent applicable tax laws require
otherwise.
(m) MARKING OF FILES. The Originator will have, at
its own expense, prior to the close of business on the Closing Date,
(i) indicated in its Computer Records that ownership of the Contracts
transferred by it to the Trust Depositor and identified on the List of
Contracts have been sold to the Trust Depositor and (ii) affixed to the
original copy of each Contract the following legend:
This Contract/Note is subject to a security interest
granted to The Bank of New York (Delaware), as Owner
Trustee for the ORIX Credit Alliance Receivables
Trust 1999-A. UCC-1 Financing Statements covering
this Contract/Note have been filed with the Secretary
of State of the State of New Jersey. Such lien will
be released only in connection with appropriate
filings in such offices. Consequently, potential
purchasers of this Contract/Note must refer to such
filings to determine whether such lien has been
released.
(n) SECURITY INTEREST. The Originator has granted a
security interest (as defined in the UCC) to the Trust Depositor, in
the Contract Assets, which is enforceable in accordance with applicable
law upon execution and delivery of this Agreement. Upon the filing of
UCC-1 financing statements naming the Trust Depositor as secured party
and the Originator as debtor, the Trust Depositor shall have a first
priority perfected security interest in the Contract Assets (except for
any Permitted Liens). All filings (including, without limitation, such
UCC filings) as are necessary in any jurisdiction to perfect the
interest of the Trust Depositor in the Contract Assets have been made.
(o) YEAR 2000 STATUS. (i) Any reprogramming required
to permit the proper functioning during and following the year 2000 of
the Servicer's computer systems will have been completed prior to
January 1, 2000 and (ii) the information set forth in the Prospectus
under "ORIX Credit Alliance, Inc. -
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Assessment of Year 2000 Readiness Disclosure" is accurate in all
material respects.
SECTION 3.02. REPRESENTATIONS AND WARRANTIES REGARDING EACH
CONTRACT AND AS TO CERTAIN CONTRACTS IN THE AGGREGATE. The Originator represents
and warrants (x) with respect to subsections (a)-(c) below, as to each Contract
as of the execution and delivery of this Agreement and as of the Closing Date,
and as of each Subsequent Transfer Date with respect to each Substitute
Contract, and (y) with respect to subsections (d)-(f) below, as to the Contracts
Pool in the aggregate as of the Closing Date, and as of each Subsequent Transfer
Date with respect to Substitute Contracts (after giving effect to the addition
of such Substitute Contracts to the Contracts Pool), that:
(a) LIST OF CONTRACTS. The information set forth in
the List of Contracts (as the same may be amended or deemed amended in
respect of a conveyance of Substitute Contracts on a Subsequent
Transfer Date) is true, complete and correct as of the applicable
Cutoff Date.
(b) ELIGIBLE CONTRACT. Such Contract satisfies the
criteria for the definition of Eligible Contract set forth in this
Agreement as of the date of its conveyance hereunder.
(c) NO "TRUE LEASES". No Contract constituting a
Lease is a "true lease" as distinguished from a financing lease.
(d) NO FRAUD. Each Contract was originated without
any fraud or material misrepresentation by the Originator or, to the
best of the Originator's knowledge, on the part of the Obligor or the
Vendor.
(e) CONTRACTS SECURED BY FIXTURES. No material
portion of the Pool Balance of the Contracts Pool consists of Contracts
secured by Equipment constituting fixtures.
(f) CONTRACTS SECURED BY OTHER REAL PROPERTY. No
material portion of the Pool Balance of the Contracts Pool consists of
Contracts additionally secured by other real property (exclusive of or
in addition to Equipment constituting fixtures).
SECTION 3.03. REPRESENTATIONS AND WARRANTIES REGARDING THE
INITIAL CONTRACTS IN THE AGGREGATE. The Originator represents and warrants, as
of the Closing Date, that:
(a) AMOUNTS. The Pool Balance of the Contracts as of
the Initial Cutoff Date equals the sum of the principal balance of the
Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the Class
A-4 Notes, the Class B Notes, the Class C Notes and the Certificates on
the Closing Date.
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(b) CHARACTERISTICS. The Initial Contracts have the
following additional characteristics: (i) no Contract has a remaining
maturity of more than months; (ii) the final scheduled Distribution
Date on the Contract with the latest maturity is not later than ;
(iii) no Contract was originated after the Initial Cutoff Date; and
(iv) not more than % of the Initial Contracts (as measured by the
Pool Balance) provide for Scheduled Payments due on a basis other than
monthly.
SECTION 3.04. REPRESENTATIONS AND WARRANTIES REGARDING THE
CONTRACT FILES. The Originator represents and warrants as of the Closing Date
with respect to the Initial Contracts (or as of the Subsequent Transfer Date,
with respect to Substitute Contracts), that (i) immediately prior to such date
(as applicable), the Originator had possession of each original Contract and the
related complete Contract File, and there were no other custodial agreements
relating to the same in effect; (ii) each of such documents which is required to
be signed by the Obligor has been signed by the Obligor in the appropriate
spaces; (iii) all blanks on any form have been properly filled in and each form
has otherwise been correctly prepared; and (iv) the complete Contract File for
each Contract is in the possession of the Servicer.
SECTION 3.05. REPRESENTATIONS AND WARRANTIES REGARDING
CONCENTRATIONS OF INITIAL CONTRACTS. The Originator represents and warrants as
of the Closing Date, as to the composition of the Initial Contracts in the
Contracts Pool as of the Initial Cutoff Date, that:
(i) the Pool Balance of all End-User Contracts with Obligors who
finance, lease or are related to Equipment used in the
trucking industry (measured by the Pool Balance as of the date
of determination) does not exceed % of the Pool Balance of
the Contracts Pool;
(ii) the Pool Balance of all End-User Contracts with Obligors who
comprise the ten (10) largest Obligors (measured by the Pool
Balance as of the date of determination) does not exceed %
of the Pool Balance of the Contracts Pool;
(iii) the aggregate Principal Balance of all Contracts purchased by
the Originator from any single Vendor or affiliated group of
Vendors will not exceed % of the aggregate Principal
Balance of the Contracts Pool;
(iv) the aggregate Principal Balance of all Contracts of each
Obligor or affiliated group of Obligors shall not exceed %
of the aggregate Principal Balance of the Contracts Pool; and
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(v) the Pool Balance of all End-User Contracts with Obligors
located in a single State of the United States as of the
Initial Cutoff Date does not exceed % of the Pool
Balance of the Contracts Pool.
(vi) the Pool Balance of all End-User Contracts related to a single
Obligor does not exceed 1.50% of the Pool Balance of the
Contracts Pool.
(vii) the Pool Balance of all End-User Contracts purchased from
a Vendor with full or partial recourse does not exceed 1.50%
of the Pool Balance of the Contracts Pool.
SECTION 3.06. REPRESENTATIONS AND WARRANTIES REGARDING THE
TRUST DEPOSITOR. By its execution of this Agreement and each Subsequent Transfer
Agreement, the Trust Depositor represents and warrants to the Trust, the
Indenture Trustee, the Noteholders and the Certificateholder that:
(a) ORIGINATOR'S REPRESENTATIONS AND WARRANTIES. The
representations and warranties set forth in Section 3.02, Section 3.03,
Section 3.04 and Section 3.05 of this Agreement and of the OCAI
Transfer Agreement are true and correct.
(b) ORGANIZATION AND GOOD STANDING. The Trust
Depositor is a corporation duly organized, validly existing and in good
standing under the laws of Delaware and has the corporate power to own
its assets and to transact the business in which it is currently
engaged. The Trust Depositor is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction in
which the character of the business transacted by it or properties
owned or leased by it requires such qualification and in which the
failure so to qualify would have a material adverse effect on the
business, properties, assets, or condition (financial or other) of the
Trust Depositor or the Trust.
(c) AUTHORIZATION; VALID SALE; BINDING OBLIGATIONS.
The Trust Depositor has the power and authority to make, execute,
deliver and perform this Agreement and the other Transaction Documents
to which it is a party and all of the transactions contemplated under
this Agreement and the other Transaction Documents to which it is a
party, and to create the Trust and cause it to make, execute, deliver
and perform its obligations under this Agreement and the other
Transaction Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and
performance of this Agreement and the other Transaction Documents to
which it is a party and to cause the Trust to be created. This
Agreement and the related Subsequent Transfer Agreement, if any, shall
effect a valid sale, transfer and assignment of the Trust Assets,
enforceable against the Trust Depositor and creditors of and purchasers
from the Trust Depositor. This Agreement and the other Transaction
Documents to which the Trust Depositor is a party constitute the legal,
valid and binding obligation of the Trust Depositor enforceable in
accordance with their terms, except as enforcement of such terms may be
limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and by the availability of
equitable remedies.
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(d) NO CONSENT REQUIRED. The Trust Depositor is not
required to obtain the consent of any other party or any consent,
license, approval or authorization from, or registration or declaration
with, any Governmental Authority in connection with the execution,
delivery, performance, validity or enforceability of this Agreement or
the other Transaction Documents to which it is a party.
(e) NO VIOLATIONS. The execution, delivery and
performance of this Agreement and the other Transaction Documents to
which it is a party by the Trust Depositor, and the consummation of the
transactions contemplated hereby and thereby, will not violate any
Requirement of Law applicable to the Trust Depositor, or constitute a
material breach of any mortgage, indenture, contract or other agreement
to which the Trust Depositor is a party or by which the Trust Depositor
or any of the Trust Depositor's properties may be bound, or result in
the creation or imposition of any security interest, lien, charge,
pledge, preference, equity or encumbrance of any kind upon any of its
properties pursuant to the terms of any such mortgage, indenture,
contract or other agreement, other than as contemplated by the
Transaction Documents.
(f) LITIGATION. No litigation or administrative
proceeding of or before any court, tribunal or governmental body is
currently pending, or to the knowledge of the Trust Depositor
threatened, against the Trust Depositor or any of its properties or
with respect to this Agreement, the other Transaction Documents to
which it is a party or the Securities (1) which, if adversely
determined, would in the reasonable judgment of the Trust Depositor
have a material adverse effect on the business, properties, assets or
condition (financial or otherwise) of the Trust Depositor or the Trust
or the transactions contemplated by this Agreement or the other
Transaction Documents to which the Trust Depositor is a party or (2)
seeking to adversely affect the federal income tax or other federal,
state or local tax attributes of the Certificate or Notes.
(g) BULK SALES. The execution, delivery and
performance of this Agreement do not require compliance with any "bulk
sales" laws by the Trust Depositor.
(h) SOLVENCY. The Trust Depositor, at the time of and
after giving effect to each conveyance of Trust Assets hereunder, is
Solvent on and as of the date thereof.
(i) TAXES. The Trust Depositor has filed or caused to
be filed all tax returns which, to its knowledge, are required to be
filed and has put all
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taxes shown to be due and payable on such returns or on any assessments
made against it or any of its property and all other taxes, fees or
other charges imposed on it or any of its property by any Governmental
Authority (other than any amount of tax due, the validity of which is
currently being contested in good faith by appropriate proceedings and
with respect to which reserves in accordance with generally accepted
accounting principles have been provided on the books of the Trust
Depositor); no tax lien has been filed and, to the Trust Depositor's
knowledge, no claim is being asserted, with respect to any such tax,
fee or other charge.
(j) PLACE OF BUSINESS; NO CHANGES. The Trust
Depositor's sole place of business (within the meaning of Article 9 of
the UCC) is as set forth in Section 13.04 below. The Trust Depositor
has not changed its name, whether by amendment of its Certificate of
Incorporation, by reorganization or otherwise, and has not changed the
location of its place of business, within the four months preceding the
Closing Date.
(k) NOT AN INVESTMENT COMPANY. The Trust Depositor is
not an "investment company" within the meaning of the Investment
Company Act of 1940, as amended (or the Trust Depositor is exempt from
all provisions of such Act).
(l) SALE TREATMENT. The Trust Depositor has treated
the transfer of Contract Assets to the Trust Depositor for all purposes
(including financial accounting purposes) as a sale and purchase on all
of its relevant books, records, financial statements and other
applicable documents, except to the extent applicable tax laws require
otherwise.
Such representations speak as of the execution and delivery of this Agreement
and as of the Closing Date in the case of the Initial Contracts, and as of the
applicable Subsequent Transfer Date in the case of the Substitute Contracts, but
shall survive the sale, transfer and assignment of the Contracts to the Trust.
SECTION 3.07. REPRESENTATIONS AND WARRANTIES REGARDING THE
SERVICER. The Servicer represents and warrants to the Owner Trustee, the
Indenture Trustee, the Noteholders and the Certificateholder that:
(a) ORGANIZATION AND GOOD STANDING. The Servicer is a
corporation duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization and has the corporate
power to own its assets and to transact the business in which it is
currently engaged. The Servicer is duly qualified to do business as a
foreign corporation and is in good standing in each
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jurisdiction in which the character of the business transacted by it or
properties owned or leased by it requires such qualification and in
which the failure so to qualify would have a material adverse effect on
the business, properties, assets, or condition (financial or otherwise)
of the Servicer or the Trust. The Servicer is properly licensed in each
jurisdiction to the extent required by the laws of such jurisdiction to
service the Contracts in accordance with the terms hereof.
(b) AUTHORIZATION; BINDING OBLIGATIONS. The Servicer
has the power and authority to make, execute, deliver and perform this
Agreement and the other Transaction Documents to which the Servicer is
a party and all of the transactions contemplated under this Agreement
and the other Transaction Documents to which the Servicer is a party,
and has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement and the other
Transaction Documents to which the Servicer is a party. This Agreement
and the other Transaction Documents to which the Servicer is a party
constitute the legal, valid and binding obligation of the Servicer
enforceable in accordance with their terms, except as enforcement of
such terms may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and by the
availability of equitable remedies.
(c) NO CONSENT REQUIRED. The Servicer is not required
to obtain the consent of any other party or any consent, license,
approval or authorization from, or registration or declaration with,
any Governmental Authority in connection with the execution, delivery,
performance, validity or enforceability of this Agreement and the other
Transaction Documents to which the Servicer is a party.
(d) NO VIOLATIONS. The execution, delivery and
performance of this Agreement and the other Transaction Documents to
which the Servicer is a party by the Servicer will not violate any
Requirements of Law applicable to the Servicer, or constitute a
material breach of any mortgage, indenture, contract or other agreement
to which the Servicer is a party or by which the Servicer or any of the
Servicer's properties may be bound, or result in the creation of or
imposition of any security interest, lien, pledge, preference, equity
or encumbrance of any kind upon any of its properties pursuant to the
terms of any such mortgage, indenture, contract or other agreement,
other than as contemplated by the Transaction Documents.
(e) LITIGATION. No litigation or administrative
proceeding of or before any court, tribunal or governmental body is
currently pending, or to the knowledge of the Servicer threatened,
against the Servicer or any of its properties or with respect to this
Agreement, or any other Transaction Document to which
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the Servicer is a party which, if adversely determined, would in the
reasonable judgment of the Servicer have a material adverse effect on
the business, properties, assets or condition (financial or otherwise)
of the Servicer or the Trust or the transactions contemplated by this
Agreement or any other Transaction Document to which the Servicer is a
party.
(f) REPORTS. All reports, certificates and other
written information furnished by the Servicer with respect to the
Contracts are correct in all material respects.
ARTICLE FOUR
PERFECTION OF TRANSFER AND
PROTECTION OF SECURITY INTERESTS
SECTION 4.01. CUSTODY OF CONTRACTS. The contents of each
Contract File shall be held in the custody of the Custodian under the Custodian
Agreement for the benefit of, and as agent for, the Indenture Trustee.
SECTION 4.02. FILING. On or prior to the Closing Date, the
Originator, Trust Depositor and Servicer shall cause the UCC financing
statement(s) referred to in Section 2.02(x) hereof to be filed, and from time to
time the Servicer shall take and cause to be taken such actions and execute such
documents as are necessary or desirable or as the Owner Trustee or Indenture
Trustee may reasonably request (it being understood and agreed that the
Indenture Trustee is under no duty to make any such request) to perfect and
protect the Trust's first priority perfected interest in the Trust Assets
against all other persons, including, without limitation, the filing of
financing statements, amendments thereto and continuation statements, the
execution of transfer instruments and the making of notations on or taking
possession of all records or documents of title.
SECTION 4.03. NAME CHANGE OR RELOCATION. (a) During the term
of this Agreement, none of the Originator, the Servicer and the Trust Depositor
shall change its name, identity or structure or relocate its chief executive
office without first giving at least 30 days' prior written notice to the Owner
Trustee and the Indenture Trustee.
(b) If any change in either the Servicer's, the Originator's
or the Trust Depositor's name, identity or structure or other action would make
any financing or continuation statement or notice of ownership interest or lien
relating to any Contract Asset seriously misleading within the meaning of
applicable provisions of the UCC or any title statute, the Servicer and/or the
Originator, no later than five days after the effective date of such change,
shall file such amendments as may be required to preserve and protect the
Trust's interests in the Trust Assets and the proceeds thereof. In addition,
neither the Originator, the Servicer nor the Trust Depositor shall change the
place of its
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chief executive office (within the meaning of Article 9 of the UCC) unless it
has first taken such action as is advisable or necessary to preserve and protect
the Trust's interest in the Trust Assets. Promptly after taking any of the
foregoing actions, the Servicer shall deliver to the Owner Trustee and the
Indenture Trustee an Opinion of Counsel reasonably acceptable to the Owner
Trustee and the Indenture Trustee stating that, in the opinion of such counsel,
all financing statements or amendments necessary to preserve and protect the
interests of the Owner Trustee in the trust corpus have been filed, and reciting
the details of such filing.
SECTION 4.04. CHIEF EXECUTIVE OFFICE. During the term of this
Agreement, and subject to the other terms and provisions herein relating to
changes in location, the Originator will maintain its chief executive office in
one of the States of the United States.
SECTION 4.05. COSTS AND EXPENSES. The Servicer agrees to pay
all reasonable costs and disbursements in connection with the perfection and the
maintenance of perfection, as against all third parties, of the Trustees' and
Trust's right, title and interest in and to the Contract Assets (including,
without limitation, the security interest in the Equipment related thereto and
the security interests provided for in the Indenture).
SECTION 4.06. SALE TREATMENT. The Trust Depositor shall treat
the transfer of Trust Assets made hereunder for all purposes (including
financial accounting purposes) as a sale and purchase on all of its relevant
books, records, financial statements and other applicable documents.
Notwithstanding the preceding sentence, for federal income tax purposes the
transfer of Trust Assets by the Trust Depositor hereunder shall not be treated
as a sale and purchase for federal income tax purposes so long as the Trust is
disregarded as a separate entity pursuant to Treasury Regulations Section
301.7701-3(b)(1)(ii).
SECTION 4.07. SEPARATENESS FROM TRUST DEPOSITOR. The
Originator agrees to take or refrain from taking or engaging in with respect to
the Trust Depositor, as applicable, each of the actions or activities specified
in the "substantive consolidation" opinion of Xxxxxxxx & Xxxxxxxx (including any
certificates of the Originator attached thereto) delivered on the Closing Date,
upon which the conclusions therein are based.
ARTICLE FIVE
SERVICING OF CONTRACTS
SECTION 5.01. APPOINTMENT AND ACCEPTANCE; RESPONSIBILITY FOR
CONTRACT ADMINISTRATION. OCAI is hereby appointed as Servicer and custodian (as
contemplated in Article IV hereof) pursuant to this Agreement. OCAI accepts the
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appointment and agrees to act as the Servicer and custodian pursuant to this
Agreement and also as custodian pursuant to the Custodian Agreement.
The Servicer will have the sole obligation to manage,
administer, service and make collections on the Contracts and perform or cause
to be performed all contractual and customary undertakings of the holder of the
Contracts to the Obligor. The Owner Trustee, at the written request of a
Servicing Officer, shall furnish the Servicer with any powers of attorney or
other documents necessary or appropriate in the opinion of the Owner Trustee to
enable the Servicer to carry out its servicing and administrative duties
hereunder. The Servicer is hereby appointed the servicer hereunder until such
time as any Servicer Transfer may be effected under Article VIII.
SECTION 5.02. GENERAL DUTIES. The Servicer will service,
administer and enforce the Contracts in the Contracts Pool on behalf of the
Trust and will have full power and authority to do any and all things in
connection with such servicing and administration which it deems necessary or
desirable and as shall not contravene the provisions of this Agreement. The
Servicer will manage, service, administer, and make collections on the Contracts
in the Contracts Pool with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to all comparable contracts
that it services for itself or others. The Servicer's duties will include
collection and posting of all payments, responding to inquiries of Obligors
regarding the Contracts in the Contracts Pool, investigating delinquencies,
accounting for collections, furnishing monthly and annual statements with
respect to collections and payments in accordance with Article Nine hereof, in
accordance with its customary standards, policies and procedures, and using its
best efforts to maintain the perfected first priority security interest of the
Indenture Trustee in the Trust Assets. The Servicer will follow its customary
standards, policies, and procedures and will have full power and authority,
acting alone (and consistent with its customary standards, policies and
procedures, in its own name) to do any and all things in connection with such
managing, servicing, administration, and collection, including, without
limitation, litigation that it deems necessary or desirable. If the Servicer
commences a legal proceeding to enforce a Defaulted Contract pursuant to Section
5.15 or commences or participates in a legal proceeding (including a bankruptcy
proceeding) relating to or involving a Contract in the Contracts Pool, the Trust
will be deemed to have automatically assigned such Contract to the Servicer
immediately prior to commencement of any such legal proceeding, for purposes of
commencing or participating in any such proceeding as a party or claimant, and
the Servicer is authorized and empowered by the Trust, pursuant to this Section
5.02, to execute and deliver, on behalf of itself and the Trust, any and all
instruments of satisfaction or cancellation, or partial or full release or
discharge, and all other notices, demands, claims, complaints, responses,
affidavits or other documents or instruments in connection with any such
proceedings. If in any enforcement suit or legal proceeding it is held that the
Servicer may not enforce a Contract on the ground that it is not a real party
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in interest or a holder entitled to enforce the Contract, then the Owner Trustee
will, at the Servicer's expense and direction, take steps on behalf of the Trust
to enforce the Contract, including bringing suit in the Trust's name.
SECTION 5.03. CONSENT TO ASSIGNMENT OR REPLACEMENT. At the
request of an Obligor, the Servicer may in its sole discretion consent to the
assignment of the related Contract or the sublease of a unit of the Equipment
relating to a Contract, so long as such Obligor remains liable for all of its
obligations under such Contract. Upon the request of any Obligor, the Servicer
may, in its sole discretion, provide for the substitution or replacement of any
unit of Equipment for a substantially similar unit of Equipment, so long as such
Obligor remains liable for all of its obligations under such Contract.
SECTION 5.04. DISPOSITION UPON TERMINATION OF CONTRACT. Upon the
termination of a Contract included in the Contracts Pool as a result of a
default by the Obligor thereunder, and upon any such Contract becoming a
Defaulted Contract, the Servicer will use commercially reasonable efforts to
dispose of any related Equipment. Without limiting the generality of the
foregoing, the Servicer may dispose of any such Equipment by purchasing such
Equipment or by selling such Equipment to any of its Affiliates for a purchase
price equal to the fair market value thereof as reasonably determined by the
Servicer. The Servicer will deposit any Prepayments of any such disposition in
accordance with Section 7.01.
SECTION 5.05. SUBSERVICERS. The Servicer may enter into servicing
agreements with one or more subservicers (including any Affiliate of the
Servicer) to perform all or a portion of the servicing functions on behalf of
the Servicer; provided that the Servicer shall remain obligated and be liable to
the Trust for servicing and administering the Contracts in the Contracts Pool
in accordance with the provisions of this Agreement without diminution of such
obligation and liability by virtue of the appointment of such subservicer, to
the same extent and under the same terms and conditions as if the Servicer alone
were servicing and administering such Contracts. The fees and expenses of the
subservicer (if any) will be as agreed between the Servicer and its subservicer
and neither the Owner Trustee, the Trust, the Indenture Trustee nor the Holders
will have any responsibility therefor. All actions of a subservicer taken
pursuant to such a subservicer agreement will be taken as an agent of the
Servicer with the same force and effect as though performed by the Servicer.
SECTION 5.06. FURTHER ASSURANCE. The Owner Trustee and the
Indenture Trustee will, at the written request of the Servicer, furnish the
Servicer, and the Servicer will furnish any subservicer, with any powers of
attorney and other documents necessary or appropriate to enable the Servicer or
a subservicer, as applicable, to carry out its servicing and administrative
duties under this Agreement, the forms of which documents shall be prepared by
the Servicer and
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submitted for execution to the Owner Trustee or the Indenture Trustee, as the
case may be. The Servicer shall not, nor shall the Servicer permit any
sub-servicer to, initiate any action in the Indenture Trustee's name if such
action were to require the Indenture Trustee to become registered to do business
in any state in which it was not already registered and without both obtaining
the Indenture Trustee's written consent and indicating the Servicer's or such
sub-servicer's representative capacity.
SECTION 5.07. NOTICE TO OBLIGORS. The Servicer will not be
required to notify any Obligor that such Obligor's Contract or related
Equipment, or any security interest in such Contract or such Equipment, has been
sold, transferred, assigned, or conveyed pursuant to this Agreement; provided
that, in the event that the Servicer resigns or is replaced, then if the place
for payment pursuant to any Contract is changed, the Successor Servicer must
give each related Obligor prompt written notice of the appointment of the
Successor Servicer and the place to which such Obligor should make payments
pursuant to each such Contract.
SECTION 5.08. COLLECTION EFFORTS; MODIFICATION OF CONTRACTS. (a)
The Servicer will make reasonable efforts to collect all payments called for
under the terms and provisions of the Contracts in the Contracts Pool as and
when the same become due, and will follow those collection procedures which it
follows with respect to all comparable contracts that it services for itself or
others.
(b) The Servicer may, subject to Sections 5.09 and 5.10, at the
request of an Obligor and at the Servicer's option, waive, modify or otherwise
vary any other provision of a Contract in accordance with its customary and
usual credit and collection practices; provided, that no such waiver,
modification or variance shall (except as provided in Sections 5.09, 5.10 and
5.15), without the consent of each Rating Agency,
(i) have the effect of accelerating, delaying or
extending the date for or the amount of any payment of Scheduled
Payments with respect to such Contract;
(ii) be inconsistent with the servicing standards set
forth in Section 5.02; or
(iii) have a material adverse effect on the interests of
any of the Trust, the Trustees or the Securityholders.
Notwithstanding the foregoing, to the extent consistent with the Servicer's
customary and usual credit and collection practices, (A) the Servicer may grant
extensions or adjustments on any Contract; provided, however, that if the
Servicer (i) extends a Contract by more than three months in any calendar year,
(ii) extends a Contract more than twice in
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the life of such Contract, (iii) reduces the frequency of periodic payments
under a Contract, (iv) reduces the unpaid principal balance or the rate of
interest with respect to a Contract, or (v) extends a Contract in manner that is
inconsistent with the Servicer's customary and usual credit and collection
practices, the Servicer shall purchase the affected Contract no later than the
next succeeding Determination Date by either (a) depositing the unpaid Principal
Balance of the Contract (plus any related Unreimbursed Servicer Advances (unless
the Servicer effectively waives and releases its rights with respect to such
Servicer Advances) and plus accrued and unpaid interest) in the Collection
Account, or (b) transferring a Substitute Contract to the Trust in exchange for
such Contract and (B) the Servicer may grant waivers on any contract that
release or subordinate the Trust's interest in a portion of the Equipment and/or
any additional collateral that is specifically identified in the Contract
documents, and/or release obligors, guarantors, and assignors of a Contract,
provided that immediately thereafter the related Contract continues to meet the
Servicer's customary and usual underwriting standards and the remaining portion
of the Equipment and/or any additional collateral that is specifically
identified in the documents for such Contract is equal in value, as determined
in accordance with the Servicer's normal valuation procedures, to at least 120%
of the outstanding Principal Balance of such contract and the Trust Depositor's
interest therein continues to be perfected. The Servicer shall, in accordance
with its customary and usual credit and collection policies, have the right to
release or subordinate OCAI's interest in additional collateral (which does not
include the financed Equipment) if such additional collateral is not
specifically identified in the Contract documents. Additionally, notwithstanding
the foregoing, the Servicer may in its discretion waive any late payment charge
or any other fees that may be collected in the ordinary course of servicing any
Contract in the Contracts Pool.
SECTION 5.09. PREPAID CONTRACT. The Servicer may, at its option
and in accordance with its customary and usual credit and collection practices,
agree to permit a Contract in the Contracts Pool that is not otherwise
contractually prepayable by its terms to (a) prepay in part or (b) become a
Prepaid Contract (which shall not include a Contract that becomes an Prepaid
Contract due to a Casualty Loss); provided, that the Servicer will not permit
the early termination or full prepayment of such a Contract unless (i) such
early termination or full prepayment would not result in the Trust receiving an
amount (the "Prepayment Amount") less than the sum of (A) the outstanding
Principal Balance on the date of such prepayment plus any accrued and unpaid
interest payments thereon and (B) any Unreimbursed Servicer Advances thereon
(unless effectively waived and released by the Servicer), or (ii) if such early
termination or full prepayment would result in the Trust receiving a Prepayment
Amount less than the amount set forth in clause (i), either the Vendor or the
Originator shall have agreed to pay the Trust the difference between the
Prepayment Amount actually paid and the amount set forth in clause (i) (such
payment by the Vendor or Originator also to be considered a "Prepayment
Amount"). At the option of the Originator, the Servicer may use the Prepayment
Amount to purchase a
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Substitute Contract for such Prepaid Contract from the Originator. The Servicer
shall apply each partial prepayment in accordance with its customary and usual
credit and collection policies.
SECTION 5.10. ACCELERATION. The Servicer, in its sole discretion,
may accelerate (or elect not to accelerate) the maturity of all or any Scheduled
Payments under any Contract in the Contracts Pool under which a default under
the terms thereof has occurred and is continuing (after the lapse of any
applicable grace period); provided that the Servicer is required to accelerate
the Scheduled Payments due under any Contract in the Contracts Pool (and take
other action in accordance with the Originator's past practice, including
repossessing the related Equipment, to realize upon the value of such Contract
and the related Equipment) to the fullest extent permitted by the terms of such
Contract, promptly after such Contract becomes a Defaulted Contract.
SECTION 5.11. TAXES. To the extent provided for in any Contract
in the Contracts Pool, the Servicer will make reasonable efforts to collect (or
cause to be collected) all payments with respect to amounts due for taxes and
assessments relating to such Contracts or the Equipment and remit such amounts
to the appropriate Governmental Authority on or prior to the date such payments
are due.
SECTION 5.12. INSURANCE PREMIUMS. To the extent provided for in
any Contract in the Contracts Pool, the Servicer will make reasonable efforts to
collect (or cause to be collected) all payments with respect to amounts due for
insurance premiums relating to such Contracts or the Equipment and remit such
amounts to the appropriate insurer on or prior to the date such payments are
due.
SECTION 5.13. REMITTANCES. The Servicer will service all
Collections in accordance with Section 7.01 hereof.
SECTION 5.14. SERVICER ADVANCES. For each Collection Period, if
the Servicer determines that any Scheduled Payment (or portion thereof) which
was due and payable pursuant to a Contract in the Contracts Pool during such
Collection Period was not received prior to the end of such Collection Period,
the Servicer has the right to elect, but is not obligated, to make a Servicer
Advance in an amount up to the amount of such delinquent Scheduled Payment (or
portion thereof) if the Servicer reasonably believes that the advance will be
reimbursed by the related Obligor. The Servicer will deposit any Servicer
Advances into the Collection Account on or prior to 11:00 a.m. (New York City
time) on the related Transfer Date, in immediately available funds. The Servicer
will be entitled to be reimbursed for Servicer Advances pursuant to Sections
7.05(a) and 7.05(b).
SECTION 5.15. REALIZATION UPON DEFAULTED CONTRACT. The Servicer
will use its best efforts consistent with its customary and usual credit and
collection practices
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and procedures in its servicing of contracts to repossess or otherwise
comparably convert the ownership of any Equipment relating to a Defaulted
Contract and will either act as sales agent for Equipment which it repossesses
or retain a sales agent consistent with its current practices. The Servicer will
follow such other practices and procedures as it deems necessary or advisable
and as are customary and usual in its servicing of contracts and other actions
by the Servicer in order to realize upon such Equipment, which practices and
procedures may include reasonable efforts to enforce all obligations of Obligors
and repossessing and selling such Equipment at public or private sale in
circumstances other than those described in the preceding sentence. Without
limiting the generality of the foregoing, the Servicer may sell any such
Equipment to the Servicer or its Affiliates for a purchase price equal to the
then fair market value thereof. In any case in which any such Equipment OCAI has
suffered damage, the Servicer will not expend funds in connection with any
repair or toward the repossession of such Equipment unless it determines in its
discretion that such repair and/or repossession will increase the Liquidation
Proceeds by an amount greater than the amount of such expenses. The Servicer
will remit to the Collection Account the Liquidation Proceeds received in
connection with the sale or disposition of Equipment relating to a Defaulted
Contract in accordance with Section 7.01.
SECTION 5.16. MAINTENANCE OF INSURANCE POLICIES. The Servicer
will use its best efforts to ensure that each Obligor maintains an Insurance
Policy with respect to the related Equipment in an amount at least equal to the
sum of the Original Principal Balance of the related Contract in the Contracts
Pool; provided that the Servicer, in accordance with its customary servicing
procedures, may allow Obligors to self-insure. Additionally, the Servicer will
require that each Obligor maintain property damage insurance and, in the case of
Leases, also liability insurance, during the term of each Contract in the
Contracts Pool in amounts and against risks customarily insured against. If an
Obligor fails to maintain property damage insurance, the Servicer may, but is
under no obligation to, purchase and maintain such insurance on behalf of, and
at the expense of, the Obligor in accordance with the Servicer's customary
practices and policies. In connection with its activities as Servicer of the
Contracts, the Servicer agrees to present, on behalf of itself, the Trust, the
Indenture Trustee and the Holders, claims to the insurer under each Insurance
Policy and any such liability policy, and to settle, adjust and compromise such
claims, in each case, consistent with the terms of each Contract and the
Servicer's customary practice and policies.
SECTION 5.17. OTHER SERVICER COVENANTS. The Servicer hereby
covenants that:
(a) CONTRACT FILES. The Servicer will, at its own cost
and expense, maintain all Contract Files in accordance with its
customary procedures. Without limiting the generality of the preceding
sentence, the Servicer will not
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dispose of any documents constituting the Contract Files in any manner
which is inconsistent with the performance of its obligations as the
Servicer pursuant to this Agreement and will not dispose of any Contract
except as contemplated by this Agreement.
(b) COMPLIANCE WITH LAW. The Servicer will comply, in
all material respects, with all laws and regulations of any Governmental
Authority applicable to the Servicer or the Contracts in the Contracts
Pool and related Equipment and Contract Files or any part thereof;
provided that the Servicer may contest any such law or regulation in any
reasonable manner which will not materially and adversely affect the
value of (or the rights of the Trust on behalf of the Holders or the
Indenture Trustee on behalf of the Noteholders, with respect to) the
Trust Assets.
(c) OBLIGATIONS WITH RESPECT TO CONTRACTS; MODIFICATIONS.
The Servicer will duly fulfill and comply with, in all material
respects, all obligations on the part of the Trust Depositor to be
fulfilled or complied with under or in connection with each Contract in
the Contracts Pool and will do nothing to impair the rights of the
Indenture Trustee and the Holders in, to and under the Trust Assets. The
Servicer will perform such obligations under the Contracts in the
Contracts Pool and will not change or modify the Contracts, except as
otherwise permitted hereby.
(d) NO BANKRUPTCY PETITION. Prior to the date that is one
year and one day after the payment in full of all amounts owing in
respect of all outstanding Securities, the Servicer will not institute
against the Trust Depositor, or the Trust, or join any other Person in
instituting against the Trust Depositor or the Trust, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or
other similar proceedings under the laws of the United States or any
state of the United States. This Section 5.17(d) will survive the
termination of this Agreement.
(e) LOCATION OF CONTRACT FILES. The Contract Files shall
remain at all times in the possession of the Servicer.
SECTION 5.18. SERVICING COMPENSATION. As compensation for its
servicing activities hereunder and reimbursement for its expenses as set forth
in Section 5.19, the Servicer shall be entitled to receive a monthly servicing
fee in respect of any Collection Period (or portion thereof) prior to the
termination of the Trust (with respect to each Collection Period, the "Servicing
Fee") equal to one-twelfth of the product of (A) the Servicing Fee Percentage
and (B) the Pool Balance of the Contracts Pool as of the first day of such
Collection Period. Notwithstanding anything else herein to the contrary, in no
event shall the Indenture Trustee be liable for any Servicing Fee or for any
differential in the amount of the Servicing Fee paid hereunder and the amount
necessary to induce any Successor Servicer to act as Successor Servicer under
this Agreement and the transactions set forth or provided for herein.
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SECTION 5.19. PAYMENT OF CERTAIN EXPENSES BY SERVICER. The
Servicer will be required to pay all expenses incurred by it in connection with
its activities under this Agreement, including fees and disbursements of
independent accountants, the Owner Trustee (including with respect to an
administrator acting on behalf of the Owner Trustee and the Issuer), the
Indenture Trustee, taxes imposed on the Servicer, expenses incurred in
connection with payments and reports pursuant to this Agreement, and all other
fees and expenses not expressly stated under this Agreement for the account of
the Trust or the Trust Depositor. The Servicer will be required to pay all
reasonable fees and expenses (including, without limitation, legal fees and
expenses) owing to the Owner Trustee or the Indenture Trustee in connection with
the maintenance of the Trust Accounts. The Servicer shall be required to pay
such expenses for its own account and shall not be entitled to any payment or
reimbursement therefor other than the Servicing Fee, and the reimbursement for
Liquidation Expenses, to the extent funds are available therefor as provided in
the definition of Liquidation Expenses.
SECTION 5.20. RECORDS. The Servicer shall, during the period it
is Servicer hereunder, maintain such books of account and other records as will
enable the Owner Trustee and the Indenture Trustee to determine the status of
each Contract.
SECTION 5.21. INSPECTION. (a) At all times during the term
hereof, the Servicer shall afford the Owner Trustee and the Indenture Trustee
and their respective authorized agents reasonable access during normal business
hours to the Servicer's records relating to the Contracts and will cause its
personnel to assist in any examination of such records by the Owner Trustee or
the Indenture Trustee, or such authorized agents, and allow copies of the same
to be made. The examination referred to in this Section will be conducted in a
manner which does not unreasonably interfere with the Servicer's normal
operations or customer or employee relations. Without otherwise limiting the
scope of the examination the Owner Trustee or the Indenture Trustee may, using
generally accepted audit procedures, verify the status of each Contract and
review the Computer Records and other records relating thereto for conformity to
Monthly Reports prepared pursuant to Article Nine and compliance with the
standards represented to exist as to each Contract in this Agreement.
(b) At all times during the term hereof, the Servicer shall keep
available a copy of the List of Contracts at its principal executive office for
inspection by Securityholders.
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(c) The Servicer shall, if given reasonable notice by the
Indenture Trustee after the end of any Collection Period, provide the Indenture
Trustee with a copy of the Computer Record.
SECTION 5.22. TRUSTEES TO COOPERATE IN RELEASES. At the same time
as (i) any Contract becomes a Prepaid Contract and in connection therewith the
Equipment related to such Prepaid Contract is sold, or (ii) the Servicer
substitutes or replaces any unit of Equipment as contemplated in Section 5.03
(such events in subsections (i) and (ii) to be certified to the Indenture
Trustee by an Authorized Officer of the Servicer), the Owner Trustee, on behalf
of the Trust, and the Indenture Trustee, on behalf of the Noteholders, will to
the extent requested in writing by the Servicer release the Trust's interest in
the Equipment relating to such Expired Lease or Prepaid Contract or such
substituted or replaced Equipment, as the case may be; provided that such
release will not constitute a release of the Trust's interest in the proceeds of
such sale (other than with respect to Equipment that is replaced pursuant to
Section 5.03). In connection with any sale of such Equipment, the Owner Trustee,
on behalf of the Trust, and the Indenture Trustee will execute and deliver to
the Servicer any assignments, bills of sale, termination statements and any
other releases and instruments as the Servicer may request in writing in order
to effect such release and transfer; provided that neither the Owner Trustee nor
the Indenture Trustee will make any representation or warranty, express or
implied, with respect to any such Equipment in connection with such sale or
transfer and assignment. Nothing in this Section 5.22 shall diminish the
Servicer's obligations pursuant to Section 7.01 with respect to the proceeds of
any such sale.
ARTICLE SIX
COVENANTS OF THE TRUST DEPOSITOR
SECTION 6.01. CORPORATE EXISTENCE. During the term of this
Agreement, the Trust Depositor will keep in full force and effect its existence,
rights and franchises as a corporation under the laws of the jurisdiction of its
incorporation and will obtain and preserve its qualification to do business in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, the other Transaction
Documents and each other instrument or agreement necessary or appropriate to the
proper administration of this Agreement and the transactions contemplated
hereby. In addition, all transactions and dealings between the Trust Depositor
and its Affiliates will be conducted on an arm's-length basis.
SECTION 6.02. CONTRACTS NOT TO BE EVIDENCED BY PROMISSORY NOTES.
The Trust Depositor will take no action to cause any Contract not originally
evidenced by an instrument as described in Section 2.06 hereof, to be evidenced
by an instrument (as defined in the UCC), except in connection with the
enforcement or collection of such Contract.
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SECTION 6.03. SECURITY INTERESTS. The Trust Depositor will not
sell, pledge, assign or transfer to any other Person, or grant, create, incur,
assume or suffer to exist any Lien on any Contract in the Contracts Pool or
related Equipment, whether now existing or hereafter transferred to the Trust,
or any interest therein. The Trust Depositor will immediately notify the Owner
Trustee and the Indenture Trustee of the existence of any Lien on any Contract
in the Contracts Pool or related Equipment; and the Trust Depositor shall defend
the right, title and interest of the Trust in, to and under the Contracts in the
Contracts Pool and the related Equipment, against all claims of third parties;
provided, however, that nothing in this Section 6.03 shall prevent or be deemed
to prohibit the Trust Depositor from suffering to exist Permitted Liens upon any
of the Contracts in the Contracts Pool or any related Equipment.
SECTION 6.04. DELIVERY OF COLLECTIONS. The Trust Depositor agrees
to pay to the Servicer promptly (but in no event later than two Business Days
after receipt) all Collections received by the Trust Depositor in respect of the
Contracts in the Contracts Pool, for application in accordance with Section
7.01.
SECTION 6.05. REGULATORY FILINGS. The Trust Depositor shall make
any filings, reports, notices, applications and registrations with, and seek any
consents or authorizations from, the Commission and any state securities
authority on behalf of the Trust as may be necessary or that the Trust Depositor
deems advisable to comply with any federal or state securities or reporting
requirements laws.
SECTION 6.06. COMPLIANCE WITH LAW. The Trust Depositor hereby
agrees to comply in all material respects with all Requirements of Law
applicable to the Trust Depositor.
SECTION 6.07. ACTIVITIES. The Trust Depositor shall not engage in
any business or activity of any kind, or enter into any transaction or
indenture, mortgage, instrument, agreement, contract, lease or other
undertaking, which is not directly related to the transactions contemplated and
authorized by this Agreement or the other Transaction Documents; provided,
however, that the Trust Depositor may purchase and sell (or grant Liens in
respect of) assets similar to the Contract Assets to other Persons in
securitization or other non-recourse financing transactions involving the
Originator or any of its Affiliates on terms and conditions (with respect to
liabilities and restrictions on its activities, as well as restrictions on its
interactions with the Originator or its Affiliates, relevant to the "bankruptcy
remoteness" or "substantive consolidation" analysis relating to the Trust
Depositor) substantially similar to the terms and conditions applicable to the
Trust Depositor under the Transaction Documents so long as the Securityholders
are not materially adversely affected thereby and the Rating Agency Condition is
satisfied.
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SECTION 6.08. INDEBTEDNESS. The Trust Depositor shall not create,
incur, assume or suffer to exist any Indebtedness or other liability whatsoever,
except (i) obligations incurred under this Agreement, (ii) liabilities incident
to the maintenance of its corporate existence in good standing or (iii)
liabilities necessarily incurred to facilitate securitizations referred to in
the proviso in Section 6.07.
SECTION 6.09. GUARANTEES. The Trust Depositor shall not become or
remain liable, directly or contingently, in connection with any Indebtedness or
other liability of any other Person, whether by guarantee, endorsement (other
than endorsements of negotiable instruments for deposit or collection in the
ordinary course of business), agreement to purchase or repurchase, agreement to
supply or advance funds, or otherwise except in connection with the transactions
described in Section 6.07.
SECTION 6.10. INVESTMENTS. The Trust Depositor shall not make or
suffer to exist any loans or advances to, or extend any credit to, or make any
investments (by way of transfer of property, contributions to capital, purchase
of stock or securities or evidences of indebtedness, acquisition of the business
or assets, or otherwise) in, any Person except (i) for purchases of Contracts
from the Originator, (ii) for investments in Eligible Investments in accordance
with the terms of this Agreement or (iii) as may be necessary to facilitate
securitizations referred to in the proviso in Section 6.07. Without limiting the
generality of the foregoing, the Trust Depositor shall not: (i) provide credit
to any Securityholder for the purpose of enabling such Securityholder to
purchase any Securities or (ii) lend any money to the Trust.
SECTION 6.11. MERGER; SALES. The Trust Depositor shall not enter
into any transaction of merger or consolidation, or liquidate or dissolve itself
(or suffer any liquidation or dissolution) or acquire or be acquired by any
Person, or convey, sell, lease or otherwise dispose of all or substantially all
of its property or business, except as provided for in this Agreement.
SECTION 6.12. DISTRIBUTIONS. The Trust Depositor shall not
declare or pay, directly or indirectly, any dividend or make any other
distribution (whether in cash or other property) with respect to the profits,
assets or capital of the Trust Depositor or any Person's interest therein, or
purchase, redeem or otherwise acquire for value any of its capital stock now or
hereafter outstanding, except that so long as no Event of Default has occurred
and is continuing and no Event of Default would occur as a result thereof or
after giving effect thereto and the Trust Depositor would continue to be Solvent
as a result thereof and after giving effect thereto, the Trust Depositor may
declare and pay dividends on its capital stock.
SECTION 6.13. OTHER AGREEMENTS. The Trust Depositor shall not
become a party to, or permit any of its properties to be bound by, any
indenture, mortgage,
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instrument, contract, agreement, lease or other undertaking, except this
Agreement and the other Transaction Documents to which it is a party and any
agreement relating to another securitization transaction permitted by Section
6.07; nor shall it amend or modify the provisions of its Certificate of
Incorporation or issue any power of attorney except to the Owner Trustee, the
Indenture Trustee or the Servicer except in accordance with the Transaction
Documents.
SECTION 6.14. SEPARATE CORPORATE EXISTENCE. The Trust Depositor
shall:
(i) Maintain its own deposit account or accounts,
separate from those of any Affiliate, with commercial banking
institutions. The funds of the Trust Depositor will not be diverted to
any other Person or for other than corporate uses of the Trust
Depositor.
(ii) Ensure that, to the extent that it shares the same
officers or other employees as any of its stockholders or Affiliates,
the salaries of and the expenses related to providing benefits to such
officers and other employees shall be fairly allocated among such
entities, and each such entity shall bear its fair share of the salary
and benefit costs associated with all such common officers and
employees.
(iii) Ensure that, to the extent that it jointly
contracts with any of its stockholders or Affiliates to do business with
vendors or service providers or to share overhead expenses, the costs
incurred in so doing shall be allocated fairly among such entities, and
each such entity shall bear its fair share of such costs. To the extent
that the Trust Depositor contracts or does business with vendors or
service providers when the goods and services provided are partially for
the benefit of any other Person, the costs incurred in so doing shall be
fairly allocated to or among such entities for whose benefit the goods
and services are provided, and each such entity shall bear its fair
share of such costs. All material trans actions between Trust Depositor
and any of its Affiliates shall be only on an arm's length basis.
(iv) To the extent that the Trust Depositor and any of
its stock holders or Affiliates have offices in the same location, there
shall be a fair and appropriate allocation of overhead costs among them,
and each such entity shall bear its fair share of such expenses.
(v) Conduct its affairs strictly in accordance with its
Certificate of Incorporation and observe all necessary, appropriate and
customary corporate formalities, including, but not limited to, holding
all regular and special stockholders' and directors' meetings
appropriate to authorize all corporate action,
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keeping separate and accurate minutes of its meetings, passing all
resolutions or consents necessary to authorize actions taken or to be
taken, and maintaining accurate and separate books, records and
accounts, including, but not limited to, payroll and intercompany
transaction accounts.
(vi) Take or refrain from taking, as applicable, each of
the activities specified in the "substantive consolidation" opinion of
Xxxxxxxx & Xxxxxxxx, delivered on the Closing Date, upon which the
conclusions expressed therein are based.
SECTION 6.15. LOCATION; RECORDS. The Trust Depositor (x) shall
not move outside the State of New Jersey, the location of its chief executive
office, without 30 days' prior written notice to the Owner Trustee and the
Indenture Trustee and (y) shall not move or permit the Servicer to move the
location of the Contract Files from the location(s) thereof on the Closing Date,
without 30 days' prior written notice to the Owner Trustee and the Indenture
Trustee and (z) will promptly take all actions required (including, but not
limited to, all filings and other acts necessary or advisable under the UCC of
each relevant jurisdiction in order to continue the first priority perfected
security interest of the Indenture Trustee in all Contracts in the Contracts
Pool). The Trust Depositor will give the Owner Trustee and the Indenture Trustee
prompt notice of a change within the State of New Jersey of the location of its
chief executive office.
SECTION 6.16. LIABILITY OF TRUST DEPOSITOR; INDEMNITIES. The
Trust Depositor shall be liable in accordance herewith only to the extent of the
obligations specifically undertaken by the Trust Depositor under this Agreement.
The Trust Depositor shall indemnify, defend and hold harmless the
Trust, the Owner Trustee, the Indenture Trustee and the Servicer from and
against any taxes that may at any time be asserted against any such Person with
respect to the transactions contemplated herein and in the other Transaction
Documents, including any sales, gross receipts, general corporation, tangible
personal property, New Jersey personal property replacement privilege or license
taxes (but, in the case of the Trust, not including any taxes asserted with
respect to, and as of the date of, the sale of the Contracts to the Trust or the
issuance and original sale of the Securities, or asserted with respect to
ownership of the Contracts, or federal or other income taxes arising out of
distributions on the Certificate or the Notes) and costs and expenses in
defending against the same.
The Trust Depositor shall indemnify, defend and hold harmless the
Trust, the Owner Trustee, the Indenture Trustee and the Securityholders from and
against any loss, liability or expense incurred by reason of the Trust
Depositor's willful misfeasance, bad faith or negligence (other than errors in
judgment) in the performance of its duties
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under this Agreement, or by reason of reckless disregard of its obligations and
duties under this Agreement.
The Trust Depositor shall indemnify, defend and hold harmless the
Trust, the Owner Trustee, and the Indenture Trustee, its officers, directors,
agents and employees, from and against all costs, expenses, losses, claims,
damages and liabilities arising out of or incurred in connection with the
acceptance or performance of the trusts and duties herein and, in the case of
the Owner Trustee, in the Trust Agreement and, in the case of the Indenture
Trustee, in the Indenture and any other document or transaction contemplated in
connection herewith or therewith, except to the extent that such cost, expense,
loss, claim, damage or liability in the case of (i) the Owner Trustee, shall be
due to the willful misfeasance, bad faith or negligence of the Owner Trustee, or
shall arise from the breach by the Owner Trustee of any of its representations
or warranties set forth in Section 7.03 of the Trust Agreement, or (ii) the
Indenture Trustee, shall be due to the willful misfeasance, bad faith or
negligence of the Indenture Trustee.
The Trust Depositor shall be liable directly to and will
indemnify any injured party or any other creditor of the Trust for all losses,
claims, damages, liabilities and expenses of the Trust to the extent that the
Trust Depositor would be liable if the Trust were a partnership under the
Delaware Revised Uniform Limited Partnership Act in which the Trust Depositor
were a general partner; provided, however, that the Trust Depositor shall not be
liable for any losses incurred by a Certificateholder in the capacity of an
investor in the Certificate or a Noteholder in the capacity of an investor in
the Notes. In addition, any third party creditors of the Trust (other than in
connection with the obligations described in the immediately preceding sentence
for which the Trust Depositor shall not be liable) shall be deemed third party
beneficiaries of this paragraph. The obligations of the Trust Depositor under
this paragraph shall be evidenced by the Certificate described in the Trust
Agreement.
The Trust Depositor shall indemnify, defend and hold harmless the
Owner Trustee and the Indenture Trustee, its officers, directors,
agents and employees, from and against any loss, liability or
expense incurred by reason of the Trust Depositor's or Trust's violation of
federal or state securities laws in connection with the offering and sale of the
Notes.
Indemnification under this Section shall include, without
limitation, reasonable fees and expenses of counsel and expenses of litigation.
If the Trust Depositor shall have made any indemnity payments pursuant to this
Section and the Person to or on behalf of whom such payments are made thereafter
shall collect any of such amounts from others, such Person shall promptly repay
such amounts to the Trust Depositor, without interest.
SECTION 6.17. BANKRUPTCY LIMITATIONS. The Trust Depositor shall
not, without the affirmative vote of a majority of the members of the Board of
Directors of the
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Trust Depositor (which must include the affirmative vote of at least two duly
appointed Independent directors) (A) dissolve or liquidate, in whole or in part,
or institute proceedings to be adjudicated bankrupt or insolvent, (B) consent to
the institution of bankruptcy or insolvency proceedings against it, (C) file a
petition seeking or consent to reorganization or relief under any applicable
federal or state law relating to bankruptcy, (D) consent to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the corporation or a substantial part of its property, (E) make a
general assignment for the benefit of creditors, (F) admit in writing its
inability to pay its debts generally as they become due, or (G) take any
corporate action in furtherance of the actions set forth in clauses (A) through
(F) above; provided, however, that no director may be required by any
shareholder of the Trust Depositor to consent to the institution of bankruptcy
or insolvency proceedings against the Trust Depositor so long as it is Solvent.
SECTION 6.18. LIMITATION ON LIABILITY OF TRUST DEPOSITOR AND
OTHERS. The Trust Depositor and any director or officer or employee or agent of
the Trust Depositor may rely in good faith on any document of any kind, prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder. The Trust Depositor and any director or officer or employee
or agent of the Trust Depositor shall be reimbursed by the Indenture Trustee for
any liability or expense incurred by reason of the Indenture Trustee's willful
misfeasance, bad faith or gross negligence (except errors in judgment) in the
performance of its duties hereunder, or by reason of reckless disregard of its
obligations and duties hereunder. The Trust Depositor shall not be under any
obligation to appear in, prosecute or defend any legal action that shall not be
incidental to its obligations under this Agreement, and that in its opinion may
involve it in any expense or liability.
SECTION 6.19. CHIEF EXECUTIVE OFFICE. During the term of this
Agreement, the Trust Depositor will maintain its chief executive office in one
of the States of the United States.
ARTICLE SEVEN
ESTABLISHMENT OF ACCOUNTS; DISTRIBUTIONS; RESERVE FUND
SECTION 7.01. TRUST ACCOUNTS; COLLECTIONS. (a) On or before
the Closing Date, the Trust Depositor shall establish the Collection Account,
Note Distribution Account, Reserve Fund and the Spread Fund (each as hereinafter
defined), each in the name of the Indenture Trustee for the benefit of the
Noteholders and the Certificateholder, respectively. The Servicer and Indenture
Trustee are hereby required to ensure that each of the Trust Accounts is
established and maintained as an Eligible Deposit Account with a Qualified
Institution. If any institution with which any of the accounts established
pursuant to this Section 7.01(a) are established ceases to be a Qualified
Institution, the Servicer, or if the Servicer fails to do so, the Indenture
Trustee
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(as the case may be) shall within 10 Business Days establish a replacement
account at a Qualified Institution after notice of such event.
(b) The Servicer shall deposit or cause to be deposited, without
deposit into any intervening account, into the Collection Account not later than
two Business Days following actual receipt of such remittance by the Servicer,
all Collections on deposit with the Servicer in the form of available funds, and
all Collections otherwise received by the Servicer.
(c) Notwithstanding Section 7.01(b), the Servicer shall deposit
or cause to be deposited, on the Closing Date and on each Subsequent Transfer
Date thereafter, in immediately available funds into the Collection Account, all
Collections received after the applicable Cutoff Date and through and including
the date two days preceding the Closing Date or Subsequent Transfer Date, as the
case may be, in respect of Contracts being transferred to the Trust on such
date.
(d) Notwithstanding Sections 7.01(b) and (c), the Servicer shall
not be required to deposit or cause to be deposited Collections on any Contracts
in the Contracts Pool on which (and to the extent that) the Servicer has
previously made a Servicer Advance which has not been reimbursed, which amounts
the Servicer may retain (as reimbursement of such Servicer Advance).
(e) Notwithstanding Sections 7.01(b) and (c), if (i) the Servicer
makes a deposit into the Collection Account in respect of a Collection of a
Contract in the Contract Pool and such Collection was received by the Servicer
in the form of a check which is not honored for any reason, or (ii) the Servicer
makes a mistake with respect to the amount of any Collection and deposits an
amount that is less than or more than the actual amount of such Collection, the
Servicer shall appropriately adjust the amount subsequently deposited into the
Collection Account to reflect such dishonored check or mistake. Any Scheduled
Payment in respect of which a dishonored check is received shall be deemed not
to have been paid.
SECTION 7.02. RESERVE FUND DEPOSIT. On the Closing Date, the
Owner Trustee, on behalf of the Trust Depositor, shall deposit the Reserve Fund
Initial Deposit into the Reserve Fund from the net proceeds of the Securities.
SECTION 7.03. TRUST ACCOUNT PROCEDURES. If the Servicer so
directs, in writing, the Indenture Trustee shall accept such directions as
directions of the Trust and shall invest the amounts in the Trust Accounts in
Qualified Eligible Investments of the type specified in such written direction
that mature not later than one Business Day prior to the next succeeding
Distribution Date. Once such funds are invested, the Indenture Trustee shall not
change the investment of such funds. Any loss on such investments shall
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be deposited in the applicable Trust Account by the Servicer out of its own
funds immediately as realized. Funds in the Trust Accounts not so invested must
be insured to the extent permitted by law by the Bank Insurance Fund or the
Savings Association Insurance Fund of the Federal Deposit Insurance Corporation.
Subject to the restrictions herein, the Indenture Trustee may purchase a
Qualified Eligible Investment from itself or an Affiliate. Subject to the other
provisions hereof, the Indenture Trustee shall have sole control over each such
investment and the income thereon, and any certificate or other instrument
evidencing any such investment, if any, shall be delivered directly to the
Indenture Trustee or its agent, together with each document of transfer, if any,
necessary to transfer title to such investment to the Indenture Trustee in a
manner which complies with this Section 7.03. All Investment Earnings on
investments of funds in the Trust Accounts shall be deposited in the Collection
Account pursuant to Section 7.01 and distributed on the next Distribution Date
pursuant to Section 7.05. The Trust Depositor and the Trust agree and
acknowledge that the Indenture Trustee is to have "control" (within the meaning
of Section 8-102 of the UCC as enacted in New Jersey) of collateral comprised of
"Investment Property" (within the meaning of Section 9-115 of the UCC as enacted
in New Jersey) for all purposes of this Agreement. In the absence of timely
written direction from the Servicer, the Indenture Trustee shall invest amounts
in the Trust Accounts in Qualified Eligible Investments of the type specified in
clause (vi) of the definition of Eligible Investments herein.
SECTION 7.04. SECURITYHOLDER DISTRIBUTIONS. (a) Each Noteholder
and Certificateholder as of the related Record Date shall be paid on the next
succeeding Distribution Date by check mailed to such Noteholder or
Certificateholder at the address for such Noteholder or Certificateholder
appearing on the Note Register or Certificate Register or by wire transfer if
such Noteholder or Certificateholder provides written instructions to the
Indenture Trustee, or Owner Trustee, respectively, at least ten days prior to
such Distribution Date.
(b) The Indenture Trustee shall serve as the Paying Agent
hereunder and shall make the payments to the Noteholders and Certificateholder
required hereunder. The Indenture Trustee hereby agrees that all amounts held by
it for payment hereunder will be held in trust for the benefit of the
Noteholders and Certificateholder.
SECTION 7.05. ALLOCATIONS AND DISTRIBUTIONS.
(a) Allocations and Distributions Prior to an Event of Default.
On each Determination Date prior to an Event of Default, the Servicer, pursuant
to written monthly payment instructions and notification, shall instruct the
Indenture Trustee to withdraw, and on such Distribution Date the Indenture
Trustee acting in accordance with such written instructions shall withdraw, the
amounts required to be withdrawn from the Collection Account pursuant to this
Section and deposited to the Note Distribution
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Account (pursuant to Sections 3.01 and 8.02(b) of the Indenture) in order to
make the following payments or allocations from the Available Amounts for such
Distribution Date (in each case, such payment or transfer to be made only to the
extent funds remain available therefor after all prior payments and transfers
for such Distribution Date have been made), in the following order of priority:
(i) pay to the Servicer, the amount of any Unreimbursed
Servicer Advance;
(ii) pay to the Indenture Trustee the costs and express
associated with the appointment of a Successor Servicer and the
transition relating thereto (which amount shall not, taken in the
aggregate with all other amounts withdrawn for such purpose, exceed
$100,000);
(iii) pay to the Servicer, the monthly Servicing Fee for
the preceding monthly period together with any amounts in respect of the
Servicing Fee that were due in respect of prior monthly periods that
remain unpaid; provided, however, the Indenture Trustee shall be
permitted to deduct from such amount and apply to its own account any
accrued and unpaid fees, unpaid expenses or indemnity payments due and
unpaid to the Indenture Trustee under the Indenture if the Servicer
shall fail to make timely payment of such amounts to the Indenture
Trustee; and provided, further, however, in no event shall the Indenture
Trustee be entitled to deduct at this priority level amounts in excess
of such monthly Servicing Fee;
(iv) pay to the Indenture Trustee on behalf of the Class
A-1 Noteholders, Class A-2 Noteholders, Class A-3 Noteholders and Class
A-4 Noteholders an amount equal to interest accrued in respect of the
related Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4
Notes at the Class A-1 Interest Rate, Class A-2 Interest Rate, Class A-3
Interest Rate and Class A-4 Interest Rate, respectively, for the Accrual
Period immediately preceding such Distribution Date, together with any
such amounts that accrued in respect of prior Accrual Periods for which
no allocation was previously made; provided that if the Available
Amounts remaining to be allocated pursuant to this clause are less than
the full amount required to be so allocated, such remaining Available
Amounts shall be allocated to each Holder of a Class A Note pro rata
based upon the outstanding Principal Amount thereof;
(v) pay to the Indenture Trustee on behalf of the Class
B Noteholders an amount equal to the interest accrued thereon at the
Class B Interest Rate for the Accrual Period immediately preceding such
Distribution Date, together with any amounts that accrued in respect of
prior Accrual Periods for which no allocation was previously made;
provided that if the Available Amounts remaining to be allocated
pursuant to this clause are less than the full amount required to be so
paid, such remaining Available Amount shall be paid to each Class B
Noteholder pro rata based on the outstanding Principal Amount thereof;
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(vi) pay to the Indenture Trustee on behalf of the Class
C Note holders, an amount equal to the interest accrued thereon at the
Class C Interest Rate for the Accrual Period immediately preceding such
Distribution Date, together with any such amounts that accrued in
respect of prior Accrual Periods for which no allocation was previously
made; provided that if the Available Amounts remaining to be allocated
pursuant to this clause are less than the full amount required to be so
paid, such remaining Available Amounts shall be paid to each Class C
Noteholder pro rata based on the outstanding Principal Amount thereof;
(vii) pay to the Indenture Trustee, on behalf of the
Class A-1 Noteholders, the Class A Principal Payment Amount for such
Distribution Date; provided that if the Available Amounts remaining to
be allocated pursuant to this clause are less than the full amount
required to be so paid, such remaining Available Amounts shall be
allocated to each Class A-1 Note pro rata based on the outstanding
principal amount thereof;
(viii) pay to the Indenture Trustee, on behalf of the
Class A-2 Noteholders, (A) $0 until the Distribution Date on which the
Principal Amount of the Class A-1 Notes is $0; (B) on the Distribution
Date on which the Principal Amount of the Class A-1 Notes is being
reduced to $0, the excess of the Monthly Principal Amount over the
amount necessary to reduce the Principal Amount of the Class A-1 Notes
to $0 on such date, but only up to the amount of the Class A Principal
Payment Amount, and (C) on each subsequent Distribution Date, the Class
A Principal Payment Amount; provided that if the Available Amounts
remaining to be allocated pursuant to this clause are less than the full
amount required to be so paid, such remaining Available Amounts shall be
allocated to each Class A-2 Note pro rata based on the outstanding
principal amount thereof;
(ix) pay to the Indenture Trustee, on behalf of the Class
A-3 Noteholders, (A) $0 until the Distribution Date on which the
Principal Amount of the Class A-1 Notes and Class A-2 Notes is $0, (B)
on the Distribution Date on which the Principal Amount of the Class A-2
Notes is being reduced to $0, the excess of the amount necessary to
reduce the Principal Amount of the Class A-2 Notes to $0 on such date,
but only to the amount of the Class A Principal Payment Amount and (C)
on each subsequent Distribution Date, the Class A Principal Payment
Amount; provided that if the Available Amounts remaining to be allocated
pursuant to this clause are less than the full amount required to be so
paid, such remaining Available Amounts shall be allocated to each Class
A-3 Note pro rata based on the outstanding principal amount thereof;
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(x) pay to the Indenture Trustee, on behalf of the Class
A-4 Noteholders, (A) $0 until the Distribution Date on which the
Principal Amount of the Class A-1 Notes, Class A-2 Notes and Class A-3
Notes is $0, (B) on the Distribution Date on which the Principal Amount
of the Class A-3 Notes is being reduced to $0, the excess of the amount
necessary to reduce the Principal Amount of the Class A-3 Notes to $0 on
such date, but only to the amount of the Class A Principal Payment
Amount and (C) on each subsequent Distribution Date, the Class A
Principal Payment Amount; provided that if the Available Amounts
remaining to be allocated pursuant to this clause are less than the full
amount required to be so paid, such remaining Available Amounts shall be
allocated to each Class A-4 Note pro rata based on the outstanding
principal amount thereof;
(xi) pay to the Indenture Trustee, on behalf of the Class
B Note holders, (A) $0 until the Distribution Date on which the
Principal Amount of the Class A-1 Notes is $0, (B) on the Distribution
Date on which the Principal Amount of the Class A-4 Notes is being
reduced to $0, the excess of the amount necessary to reduce the
Principal Amount of the Class A-4 Notes to $0 on such date, but only to
the amount of the Class A Principal Payment Amount and (C) on each
subsequent Distribution Date, the Class B Principal Payment Amount;
provided that if the Available Amounts remaining to be allocated
pursuant to this clause are less than the full amount required to be so
paid, such remaining Available Amounts shall be allocated to each Class
B Note pro rata based on the outstanding principal amount thereof;
(xii) pay to the Indenture Trustee, on behalf of the
Class C Noteholders, (A) $0 until the Distribution Date on which the
Principal Amount of the Class A-1 Notes is $0 and (B) on each subsequent
Distribution Date, the Class C Principal Payment Amount; provided that
if the Available Amounts remaining to be allocated pursuant to this
clause are less than the full amount required to be so paid, such
remaining Available Amounts shall be allocated to each Class C Note pro
rata based on the outstanding principal amount thereof;
(xiii) pay to the Indenture Trustee,
(A) on behalf of the Class A-2 Noteholders, (1) $0
until the Distribution Date on which the Principal Amount of the
Class A-1 Notes is $0 and (2) on each subsequent Distribution
Date, the Additional Principal, if any, until the Principal
Amount of the Class A-2 Notes is $0; provided that if the
Additional Principal exceeds the amount needed to reduce the
Principal Amount of the Class A-2 Notes to $0, then such excess
shall be paid to the Class A-3 Noteholders;
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(B) on behalf of the Class A-3 Noteholders, (1) $0
until the Distribution Date on which the Principal Amount of the
Class A-1 Notes and Class A-2 Notes is $0 and (2) on each
subsequent Distribution Date, the Additional Principal, if any,
until the Principal Amount of the Class A-3 Notes is $0; provided
that if the Additional Principal exceeds the amount needed to
reduce the Principal Amount of the Class A-3 Notes to $0, then
such excess shall be paid to the Class A-4 Noteholders;
(C) on behalf of the Class A-4 Noteholders, (1) $0
until the Distribution Date on which the Principal Amount of the
Class A-1 Notes, Class A-2 Notes and Class A-3 Notes is $0 and
(2) on each subsequent Distribution Date, the Additional
Principal, if any, until the Principal Amount of the Class A-4
Notes is $0; provided that if the Additional Principal exceeds
the amount needed to reduce the Principal Amount of the Class A-4
Notes to $0, then such excess shall be paid to the Class B
Noteholders;
(D) on behalf of the Class B Noteholders, (1) $0
until the Distribution Date on which the Principal Amount of the
Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4
Notes is $0 and (2) on each subsequent Distribution Date, the
Additional Principal, if any, until the Principal Amount of the
Class B Notes is $0; provided that if the Additional Principal
exceeds the amount needed to reduce the Principal Amount of the
Class B Notes to $0, then such excess shall be paid to the Class
C Noteholders;
(E) on behalf of the Class C Noteholders, (1) $0
until the Distribution Date on which the Principal Amount of the
Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4
Notes and Class B Notes is $0 and (2) on each subsequent
Distribution Date, the Additional Principal, if any, until the
Principal Amount of the Class C Notes is $0; provided, that if
the Additional Principal exceeds the amount needed to reduce the
Principal Amount of the Class C Notes to $0;
(xiv) pay to the Indenture Trustee, for deposit into the
Reserve Fund, such remaining Available Amounts up to such amount as may
be required to cause the amounts on deposit in the Reserve Fund to equal
the Required Reserve Amount;
(xv) if a Spread Event shall have occurred and be
continuing, pay to the Indenture Trust for deposit into the Spread Fund,
such remaining Available Amounts;
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(xvi) pay to the Indenture Trustee, such remaining
Available Amounts up to the amount of any fees, expenses or indemnity
payments due to the Indenture Trustee remain unpaid; and
(xvii) pay any remaining Available Amounts to the Holder of the
Certificate.
Prior to the occurrence of an Event of Default, if the Available
Amounts are less than the amount required to make in full the payments and
allocations set forth in Sections 7.05(a)(i)-(v) above or to make principal
payments due with respect to any payment at final maturity of any Notes, amounts
held in the Reserve Fund shall be withdrawn in order for any of such payments or
allocations to be made and such amounts will be considered as Available Amounts
for such purpose only. Upon full payment of the amounts described in Section
7.05(a)(i)-(v), if the Available Amounts are less than the amount required to
make in full the payments and allocations set forth in Sections
7.05(a)(vi)-(xi), amounts held in the Reserve Fund in excess of the Required
Reserve Amount shall be withdrawn in order for any of such payments or
allocations to be made and such amounts will be considered as Available Amounts
for such purpose only. Amounts withdrawn from the Reserve Fund pursuant to the
preceding sentence shall be applied to repay principal of the Notes in such
order of priority as set forth in Sections 7.05(a)(vi)-(xi) until such excess is
exhausted.
(b) Allocations and Payments after an Event of Default. On each
Determination Date after the occurrence and during the continuance of an Event
of Default, the Servicer, pursuant to monthly payment instructions and
notification, shall instruct the Indenture Trustee in writing to withdraw, and
on such Distribution Date the Indenture Trustee acting in accordance with such
instructions shall withdraw, the amounts required to be withdrawn from the
Collection Account pursuant to this Section and deposited to the Note
Distribution Account (pursuant to Sections 3.01 and 8.02(b) of the Indenture) in
order to make the following payments or allocations from the Available Amounts
for such Distribution Date (in each case, such payment or transfer to be made
only to the extent funds remain available therefor after all prior payments and
transfers for such Distribution Date have been made), in the following order of
priority:
(i) pay, first, to the Indenture Trustee and the Owner
Trustee the amount of any unpaid fees, expenses (including legal fees
and expenses) and indemnity payments to which the Indenture Trustee and
the Owner Trustee, as the case may be, is entitled under Section
5.06(a)(first) of the Indenture and the costs and expenses associated
with the appointment of a Successor Servicer and the transition relating
thereto (which amount shall not, taken in the aggregate with all other
amounts withdrawn for such purpose, exceed $100,000); and, then, to the
Noteholders, pro rata, an amount equal to any indemnity payments that
noteholders may have elected to pay in accordance with the terms of the
Indenture;
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(ii) pay to the Servicer, the monthly Servicing Fee for
the preceding monthly period together with any amounts in respect of the
Servicing Fee that were due in respect of prior monthly periods that
remain unpaid.
(iii) pay to the Indenture Trustee on behalf of the Class
A-1 Noteholders, Class A-2 Noteholders, Class A-3 Noteholders and Class
A-4 Noteholders an amount equal to interest accrued in respect of the
related Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4
Notes at the Class A-1 Interest Rate, Class A-2 Interest Rate, Class A-3
Interest Rate and Class A-4 Interest Rate, respectively, for the Accrual
Period immediately preceding such Distribution Date, together with any
such amounts that accrued in respect of prior Accrual Periods for which
no allocation was previously made; provided that if the Available
Amounts remaining to be allocated pursuant to this clause are less than
the full amount required to be so allocated, such remaining Available
Amounts shall be allocated to each Holder of a Class A Note pro rata
based upon the outstanding Principal Amount thereof;
(iv) pay to the Indenture Trustee on behalf of the Class
B Note holders an amount equal to the interest accrued thereon at the
Class B Interest Rate for the Accrual Period immediately preceding such
Distribution Date, together with any amounts that accrued in respect of
prior Accrual Periods for which no allocation was previously made;
provided that if the Available Amounts remaining to be allocated
pursuant to this clause are less than the full amount required to be so
paid, such remaining Available Amount shall be paid to each Class B
Noteholder pro rata based on the outstanding Principal Amount thereof;
(v) pay to the Indenture Trustee on behalf of the Class C
Noteholders, an amount equal to the interest accrued thereon at the
Class C Interest Rate for the Accrual Period immediately preceding such
Distribution Date, together with any such amounts that accrued in
respect of prior Accrual Periods for which no allocation was previously
made; provided that if the Available Amounts remaining to be allocated
pursuant to this clause are less than the full amount required to be so
paid, such remaining Available Amounts shall be paid to each Class C
Noteholder pro rata based on the outstanding Principal Amount thereof;
(vi) pay to the Indenture Trustee, on behalf of the Class
A-1 Noteholders, the Principal Amount of the Class A-1 Notes; provided
that if the Available Amounts remaining to be allocated pursuant to this
clause are less than the full amount required to be so paid, such
remaining Available Amounts shall be allocated to each Class A-1 Note
pro rata based on the outstanding principal amount thereof;
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(vii) pay to the Indenture Trustee, on behalf of the
Class X- 0 Noteholders, Class A-3 Noteholders and Class A-4 Noteholders,
the Principal Amounts of the Class A-2 Notes, Class A-3 Notes and Class
A-4 Notes; provided that if the Available Amounts remaining to be
allocated pursuant to this clause are less than the full amount required
to be so paid, such remaining Available Amounts shall be allocated to
each Class A-2 Note, Class A-3 Note and Class A-4 Note pro rata based on
the outstanding principal amount of each such Class of Notes;
(viii) pay to the Indenture Trustee, on behalf of the
Class B Noteholders, the Principal Payment Amount for such Distribution
Date; provided (i) that if the Available Amounts remaining to be
allocated pursuant to this clause are less than the full amount required
to be so paid, such remaining Available Amounts shall be allocated to
each Class B Note pro rata based on the outstanding principal amount
thereof, and (ii) if the amount to be allocated pursuant to this clause
exceeds the amount needed to repay outstanding Class B Note principal in
full, then such excess shall be applied in repayment of principal on the
Class C Notes;
(ix) pay to the Indenture Trustee, on behalf of the Class
C Noteholders, the Principal Payment Amount for such Distribution Date;
provided (i) that if the Available Amounts remaining to be allocated
pursuant to this clause are less than the full amount required to be so
paid, such remaining Available Amounts shall be allocated to each Class
C Note pro rata based on the outstanding principal amount thereof, and
(ii) if the amount to be allocated pursuant to this clause exceeds the
amount needed to repay outstanding Class C Note principal in full, then
such excess shall be applied in repayment of principal on the
Certificates; and;
(x) pay all other remaining Available Amounts to the
Holder of the Certificates.
Following the occurrence and during the continuance of an Event
of Default, if the Available Amounts are less than the amount required to make
in full the payments and allocations set forth in Sections 7.05(b)(i)-(ix)
above, amounts held in the Reserve Fund shall be withdrawn in order for the
payments or allocations set forth in Sections 7.05(b)(i)-(ix) to be made and
such amounts will be considered as Available Amounts for such purpose only.
Amounts withdrawn from the Reserve Fund pursuant to the preceding sentence shall
be applied to repay principal of such Notes in such order of priority set forth
in 7.05(b)(i)-(ix) until the Reserve Fund is exhausted.
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ARTICLE EIGHT
SERVICER DEFAULT; SERVICE TRANSFER
SECTION 8.01. SERVICER DEFAULT. "Servicer Default" means the
occurrence of any of the following:
(a) any failure by the Servicer to make any payment,
transfer or deposit or to give instructions or notice to the Owner
Trustee or the Indenture Trustee pursuant to this Agreement on or before
the date occurring two Business Days after the date such payment,
transfer, deposit, or such instruction or notice or report is required
to be made or given, as the case may be, under the terms of this
Agreement; or
(b) failure on the part of the Servicer duly to observe
or perform in any material respect any other covenants or agreements of
the Servicer set forth in this Agreement which has a material adverse
effect on the Noteholders or Certificateholder, which continues
unremedied for a period of 30 days after the first to occur of (i) the
date on which written notice of such failure requiring the same to be
remedied shall have been given to the Servicer by the Indenture Trustee
or to the Servicer and the Indenture Trustee by the Noteholders or
Certificateholder or the Indenture Trustee on behalf of such Noteholders
of Notes aggregating not less than 25% of the Principal Amount of any
Class adversely affected thereby and (ii) the date on which the Servicer
becomes aware thereof and such failure continues to materially adversely
affect such Noteholders or Certificateholder for such period; or
(c) any representation, warranty or certification made by
the Servicer in this Agreement or in any certificate delivered pursuant
to this Agreement shall prove to have been incorrect when made, which
has a material adverse effect on the Noteholders or Certificateholder
and which continues to be incorrect in any material respect for a period
of 30 days after the first to occur of (i) the date on which written
notice of such incorrectness requiring the same to be remedied shall
have been given to the Servicer and the Owner Trustee by the Indenture
Trustee, or to the Servicer, the Owner Trustee and the Indenture Trustee
by Noteholders or Certificateholder or by the Indenture Trustee on
behalf of Noteholders of Notes aggregating not less than 25% of the
Principal Amount of any Class adversely affected thereby and (ii) the
date on which the Servicer becomes aware thereof, and such incorrectness
continues to materially adversely affect such Holders for such period;
or
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(d) an Insolvency Event shall occur with respect to the
Servicer.
Notwithstanding the foregoing, a delay in or failure of
performance referred to under clause (a) above for a period of five Business
Days or referred to under clause (b) or (c) for a period of 60 days (in addition
to any period provided in clause (a), (b) or (c)) shall not constitute a
Servicer Default until the expiration of such additional five Business Days or
60 days, respectively, if such delay or failure could not be prevented by the
exercise of reasonable diligence by the Servicer and such delay or failure was
caused by an act of God or other events beyond the Servicer's control. Upon the
occurrence of any such event the Servicer shall not be relieved from using its
best efforts to perform its obligations in a timely manner in accordance with
the terms of this Agreement and the Servicer shall provide the Owner Trustee,
the Indenture Trustee and the Trust Depositor prompt notice of such failure or
delay by it, together with a description of its efforts to so perform its
obligations. The Servicer shall immediately notify the Indenture Trustee in
writing of any Servicer Default.
SECTION 8.02. SERVICER TRANSFER. (a) If a Servicer Default has
occurred and is continuing, (x) the Required Holders, or (y) the Indenture
Trustee may, by written notice (a "Termination Notice") delivered to the parties
hereto, terminate all (but not less than all) of the Servicer's management,
administrative, servicing, custodial and collection functions.
(b) Upon delivery of the notice required by Section 8.02(a) (or,
if later, on a date designated therein), and on the date that a successor
Servicer shall have been appointed pursuant to Section 8.03 (such appointment
being herein called a "Servicer Transfer"), all rights, benefits, fees,
indemnities, authority and power of the Servicer under this Agreement, whether
with respect to the Contracts, the Contract Files or otherwise, shall pass to
and be vested in such successor (the "Successor Servicer") pursuant to and under
this Section 8.02; and, without limitation, the Successor Servicer is authorized
and empowered to execute and deliver on behalf of the Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do any and all acts or things necessary or appropriate to effect the purposes
of such notice of termination. The Servicer agrees to cooperate with the
Successor Servicer in effecting the termination of the responsibilities and
rights of the Servicer hereunder, including, without limitation, the transfer to
the Successor Servicer for administration by it of all cash amounts which shall
at the time be held by the Servicer for deposit, or have been deposited by the
Servicer, in the Collection Account, or for its own account in connection with
its services hereafter or thereafter received with respect to the Contracts. The
Servicer shall transfer to the Successor Servicer all records held by the
Servicer relating to the Contracts in such electronic form as the Successor
Servicer may reasonably request and (ii) any Contract Files in the Servicer's
possession. In addition, the Servicer shall
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permit access to its premises (including all computer records and programs) to
the Successor Servicer or its designee, and shall pay the reasonable transition
expenses of the Successor Servicer. Upon a Servicer Transfer, the Successor
Servicer shall also be entitled to receive the Servicing Fee for performing the
obligations of the Servicer.
SECTION 8.03. APPOINTMENT OF SUCCESSOR SERVICER; RECONVEYANCE;
SUCCESSOR SERVICER TO ACT. Upon delivery of the notice required by Section
8.02(a) (or, if later, on a date designated therein), the Servicer shall
continue to perform all servicing functions under this Agreement until the date
specified in the Termination Notice or, if no such date is specified, until a
date mutually agreed by the Servicer and the Indenture Trustee. The Indenture
Trustee shall as promptly as possible after the giving of or receipt of a
Termination Notice, appoint a Successor Servicer, and such Successor Servicer
shall accept its appointment by a written assumption in a form acceptable to the
Indenture Trustee and Owner Trustee. If within 60 days of delivery of a
Termination Notice the Indenture Trustee is unable to obtain any bids from
eligible servicers and the Servicer shall have yet to cure the Servicer Default,
then the Indenture Trustee shall offer the Trust Depositor, and the Trust
Depositor shall offer the Originator, the right to accept retransfer of all the
Trust Assets, and such parties may accept retransfer of such Trust Assets in
consideration of the Trust Depositor's delivery to the Collection Account on or
prior to the next upcoming Distribution Date of a sum equal to the Aggregate
Principal Amount of all Securities (other than the Certificates) then
outstanding, together with accrued and unpaid interest thereon through such date
of deposit (provided, that the Indenture Trustee, if so directed by the Required
Holders in writing, need not accept and effect such reconveyance in the absence
of evidence (which may include valuations of an investment bank or similar
entity) reasonably acceptable to such Trustee or Required Holders that such
retransfer would not constitute a fraudulent conveyance of the Trust Depositor
or the Originator).
In the event that a Successor Servicer has not been appointed and
has not accepted its appointment at the time when the then Servicer has ceased
to act as Servicer, the Indenture Trustee without further action shall
automatically be appointed the Successor Servicer. Notwithstanding the
foregoing, if the Indenture Trustee is legally unable or prohibited from so
acting, it shall petition a court of competent jurisdiction to appoint any
established financial institution having a net worth of at least $50,000,000 and
whose regular business includes the servicing of contracts similar to the
Contracts as the Successor Servicer hereunder. On or after a Servicer Transfer,
the Successor Servicer shall be the successor in all respects to the Servicer in
its capacity as servicer under this Agreement and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Servicer by the terms and provisions
hereof, and the terminated Servicer shall be relieved of such responsibilities,
duties and liabilities arising after such Servicer Transfer; provided, however,
that (i) the Successor Servicer will not assume any obligations of the Servicer
described in Section 8.02 and (ii) the Successor Servicer shall not be liable
for any acts or
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omissions of the Servicer occurring prior to such Servicer Transfer or for any
breach by the Servicer of any of its representations and warranties contained
herein or in any related document or agreement. As compensation therefor, the
Successor Servicer shall be entitled to receive reasonable compensation equal to
the monthly Servicing Fee. The Owner Trustee, Securityholders and the Indenture
Trustee and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. To the
extent the terminated Servicer has made Servicer Advances, it shall be entitled
to reimbursement of the same notwithstanding its termination hereunder, to the
same extent as if it had continued to service the Contracts hereunder. In
addition, it is understood and agreed that if an Event of Default has occurred
and a Servicer Transfer is being effected by action of the Indenture Trustee
hereunder, any documented expenses reasonably incurred by the Indenture Trustee
in connection with effecting such Servicer Transfer shall be deemed expenses
reimbursable from Available Amounts after an Event of Default pursuant to
Section 7.05(b)(i) hereof and Section 5.06(a)(first) of the Indenture.
SECTION 8.04. NOTIFICATION TO SECURITYHOLDERS. (a) Promptly
following the occurrence of any Servicer Default, the Servicer shall give
written notice thereof to the Trustees, the Trust Depositor and each Rating
Agency at the addresses described in Section 13.04 hereof and to the Noteholders
and Certificateholder at their respective addresses appearing on the Note
Register and the Certificate Register, respectively.
(b) Within 10 days following any termination or appointment of a
Successor Servicer pursuant to this Article VIII, the Indenture Trustee shall
give written notice thereof to each Rating Agency and the Trust Depositor at the
addresses described in Section 13.04 hereof, and to the Noteholders and
Certificateholder at their respective addresses appearing on the Note Register
and the Certificate Register, respectively.
SECTION 8.05. EFFECT OF TRANSFER. (a) After a Servicer Transfer,
the terminated Servicer shall have no further obligations with respect to the
management, administration, servicing, custody or collection of the Contracts
and the Successor Servicer appointed pursuant to Section 8.03 shall have all of
such obligations, except that the terminated Servicer will transmit or cause to
be transmitted directly to the Successor Servicer for its own account, promptly
on receipt and in the same form in which received, any amounts (properly
endorsed where required for the Successor Servicer to collect them) received as
payments upon or otherwise in connection with the Contracts.
(b) A Servicer Transfer shall not affect the rights and duties of
the parties hereunder (including but not limited to the indemnities of the
Servicer) other than those relating to the management, administration,
servicing, custody or collection of the Contracts.
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SECTION 8.06. DATABASE FILE. Upon reasonable request by the
Indenture Trustee, the Servicer will provide the Successor Servicer with a
magnetic tape containing the database file for each Contract (i) as of the
Cutoff Date, (ii) the Subsequent Cutoff Dates, (iii) thereafter, as of the last
day of the preceding Collection Period on the Determination Date prior to a
Servicer Default and (iv) on and as of the Business Day before the actual
commencement of servicing functions by the Successor Servicer following the
occurrence of a Servicer Default.
SECTION 8.07. SUCCESSOR SERVICER INDEMNIFICATION. The original
Servicer shall defend, indemnify and hold the Successor Servicer and any
officers, directors, employees or agents of the Successor Servicer harmless
against any and all claims, losses, penalties, fines, forfeitures, legal fees
and related costs, judgments and any other costs, fees, and expenses that the
Successor Servicer may sustain in connection with the claims asserted at any
time by third parties against the Successor Servicer which result from (i) any
willful or grossly negligent act taken or omission by the Servicer or (ii) a
breach of any representations of the Servicer in Section 3.07 hereof. The
indemnification provided by this Section 8.07 shall survive the termination of
this Agreement and the removal or resignation of the Successor Servicer.
SECTION 8.08. RESPONSIBILITIES OF THE SUCCESSOR SERVICER. The
Successor Servicer will not be responsible for delays attributable to the
Servicer's failure to deliver information, defects in the information supplied
by the Servicer or other circumstances beyond the control of the Successor
Servicer.
The Successor Servicer will make arrangements with the Servicer
for the prompt and safe transfer of, and the Servicer shall provide to the
Successor Servicer, all necessary servicing files and records, including (as
deemed necessary by the Successor Servicer at such time): (i) microfiche loan
documentation, (ii) servicing system tapes, (iii) Contract payment history, (iv)
collections history and (v) the trial balances, as of the close of business on
the day immediately preceding conversion to the Successor Servicer, reflecting
all applicable Contract information. The current Servicer shall be obligated to
pay the costs associated with the transfer of the servicing files and records to
the Successor Servicer.
The Successor Servicer shall have no responsibility and shall not
be in default hereunder nor incur any liability for any failure, error,
malfunction or any delay in carrying out any of its duties under this Agreement
if any such failure or delay results from the Successor Servicer acting in
accordance with information prepared or supplied by a Person other than the
Successor Servicer or the failure of any such Person to prepare or provide such
information. The Successor Servicer shall have no responsibility, shall not be
in default and shall incur no liability (i) for any act or failure to act by any
third party, including the Servicer, the Trust Depositor or the Trustees or for
any inaccuracy or omission in a notice or communication received by the
Successor Servicer from any third party or (ii) which is due to or results from
the invalidity, unenforceability of any Contract
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with applicable law or the breach or the inaccuracy of any representation or
warranty made with respect to any Contract.
If the Indenture Trustee or any other Successor Servicer assumes
the role of Successor Servicer hereunder, such Successor Servicer shall be
entitled to the benefits of (and subject to the provisions of) Section 5.05
concerning delegation of duties to subservicers.
SECTION 8.09. RATING AGENCY CONDITION FOR SERVICER TRANSFER. Not
withstanding the foregoing provisions relating to a Servicer Transfer, no
Servicer Transfer shall be effective hereunder unless prior written notice
thereof shall have been given to the Rating Agencies, and the Rating Agency
Condition shall have been satisfied with respect thereto.
ARTICLE NINE
REPORTS
SECTION 9.01. MONTHLY REPORTS. With respect to each Distribution
Date and the related Collection Period, the Servicer will provide to each
Trustee, each Rating Agency and First Union Capital Markets Corp., on the
related Determination Date, a monthly statement (a "Monthly Report")
substantially in the form of Exhibit H hereto.
SECTION 9.02. OFFICER'S CERTIFICATE. Each Monthly Report
delivered pursuant to Section 9.01 shall be accompanied by a certificate of a
Servicing Officer certifying the accuracy of the Monthly Report and that no
Servicer Default or event that with notice or lapse of time or both would become
a Servicer Default has occurred, or if such event has occurred and is
continuing, specifying the event and its status.
SECTION 9.03. OTHER DATA. In addition, the Servicer shall, upon
the request of any Trustees, or any Rating Agency, furnish such Trustee or
Rating Agency, as the case may be, such underlying data used to generate a
Monthly Report as may be reasonably requested. The Servicer will also forward to
the Indenture Trustee, the Owner Trustee, each Rating Agency and First Union
Securities, Inc. (a) within 120 days after each calendar quarter, commencing
with the quarter ending December 31, 1999, the unaudited quarterly financial
statement of the Servicer and (b) within 120 days after each fiscal year of the
Servicer, commencing with the fiscal year ending March 31, 2000, the unaudited
annual financial statement of the Servicer, together with the related report of
the independent accountants to the Servicer. On the Distribution Date following
the receipt of each such financial statements and report, the Indenture Trustee
will forward, upon written request, to each Noteholder of record a copy of such
financial statements and report.
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SECTION 9.04. ANNUAL REPORT OF ACCOUNTANTS.
(a) The Servicer shall cause a firm of nationally recognized
independent certified public accountants (the "Independent Accountants"), who
may also render other services to the Servicer or its Affiliates, to deliver to
the Indenture Trustee, the Owner Trustee and each Rating Agency, on or before
June 30 (90 days after the end of the Servicer's fiscal year) of each year,
beginning on June 30, 2000, a report addressed to the Board of Directors of the
Servicer, the Indenture Trustee and the Owner Trustee indicating that (i) with
respect to the twelve months ended the immediately preceding March 31 to the
effect that such independent Accountants have audited the financial statements
of the Servicer, that as part of that audit, nothing came to the attention of
such Independent Accountant that causes them to believe that the Servicer was
not in compliance with any of the terms, covenants, provisions or conditions of
the relevant sections of the Agreement, insofar as they relate to accounting
matters, except for such exceptions as such Independent Accountants shall
believe to be immaterial and such other exceptions as shall be set forth in such
report, (ii) in connection with Independent Accountant's audit of the Servicer,
there were no exceptions or errors in records related to equipment leases and
loans serviced by the Servicer, except for such exceptions as such Independent
Accountants shall believe to be immaterial and such other exceptions as shall be
set forth in such report, and (iii) the Independent Accountant has performed
certain procedures as agreed by the Servicer, the Indenture Trustee (subject to
the provisions of this Section 9.04(a)) and Owner Trustee, whereby the
Independent Accountant will obtain the Monthly Report for four months with
respect to the twelve months ended the immediately preceding March 31 and for
each Monthly Report the Independent Accountant will agree all amounts in the
Monthly Report to the Servicer's computer, accounting and other reports, which
will include in such report any amounts which were not in agreement. In the
event such firm of Independent Accountants requires the Indenture Trustee to
agree to the procedures performed by such firm of Independent Accountants, the
Servicer shall direct the Indenture Trustee in writing to so agree; it being
understood and agreed that the Indenture Trustee will deliver such letter of
agreement in conclusive reliance upon the direction of the Servicer, and the
Indenture Trustee has not made any independent inquiry or investigation as to,
and shall have no obligation or liability in respect of, the sufficiency,
validity or correctness of such procedures.
(b) The Independent Accountant's report shall also indicate
that the firm is independent of the Servicer within the meaning of the Code of
Professional Ethics of the American Institute of Certified Public Accountants.
SECTION 9.05. ANNUAL STATEMENT OF COMPLIANCE FROM SERVICER. The
Servicer will deliver to the Trustees, and each of the Rating Agencies, on or
before July 31 of each year commencing July 31, 2000, an Officer's Certificate
stating that (a) a review of the activities of the Servicer during the prior
calendar year and of its performance under this Agreement was made under the
supervision of the officer signing such certificate and (b) to such officer's
knowledge, based on such review, the Servicer has fully performed or cause to be
performed in all material respects all its obligations under this Agreement and
no Servicer Default has occurred or is continuing, or, if there has been a
Servicer Default, specifying each such default known to such officer and the
nature and status thereof and the steps being taken or necessary to be taken to
remedy
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such event. A copy of such certificate may be obtained by any Securityholder by
a request in writing to the Indenture Trustee, with respect to any Noteholder,
or the Owner Trustee, with respect to any Certificateholder.
SECTION 9.06. ANNUAL SUMMARY STATEMENT. On or prior to July 31 of
each year, commencing July 31, 2000, the Servicer shall prepare and provide to
each Trustee, and each Rating Agency, a cumulative summary of the information
required to be included in the Monthly Reports for the Collection Periods ending
during the immediately preceding calendar year.
ARTICLE TEN
TERMINATION
SECTION 10.01. SALE OF TRUST ASSETS.
(a) Upon any sale of the assets of the Trust pursuant to Section
9.02 of the Trust Agreement, the Servicer shall instruct the Indenture Trustee
in writing to deposit the proceeds from such sale after all payments and
reserves therefrom have been made (the "Insolvency Proceeds") in the Collection
Account. On the Distribution Date on which the Insolvency Proceeds are deposited
in the Collection Account (or, if such proceeds are not so deposited on a
Distribution Date, on the Distribution Date immediately following such deposit),
the Servicer shall instruct the Indenture Trustee in writing to allocate and
apply (after the application on such Distribution Date of Available Amounts and
funds on deposit in the Reserve Fund pursuant to Section 7.04) the Insolvency
Proceeds as if (and in the same order of priority as) the Insolvency Proceeds
were Available Amounts being allocated and distributed on such date pursuant to
Section 7.04(b).
(b) As described in Article Nine of the Trust Agreement, notice
of any termination of the Trust shall be given by the Servicer to the Owner
Trustee and the Indenture Trustee as soon as practicable after the Servicer has
received notice thereof.
(c) Following the satisfaction and discharge of the Indenture and
the payment in full of the principal of and interest on the Notes, the
Certificateholder will succeed to the rights of the Noteholders hereunder and
the Owner Trustee will succeed to the rights of the Indenture Trustee pursuant
to this Agreement.
ARTICLE ELEVEN
REMEDIES UPON MISREPRESENTATION; REPURCHASE OPTION
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SECTION 11.01. REPURCHASES OF, OR SUBSTITUTION FOR, CONTRACTS FOR
BREACH OF REPRESENTATIONS AND WARRANTIES. Upon a discovery by the Servicer, the
Trust Depositor or the Trustees of a breach of a representation or warranty of
the Originator as set forth in Section 3.01, Section 3.02, Section 3.03, Section
3.04, and Section 3.05 or as made or deemed made in any Addition Notice or any
Subsequent Purchase Agreement relating to Substitute Contracts that materially
adversely affects the Trust's interest in such Contract (without regard to the
benefits of the Reserve Fund) (an "Ineligible Contract"), or of an inaccuracy
with respect to the representations as to concentrations of the Initial
Contracts made under Section 3.05, the party discovering the breach shall give
prompt written notice to the other parties (and the Servicer shall, with respect
to an inaccuracy concerning concentrations, select one or more Contracts,
without employing adverse selection, to be the related Excess Contract for
purposes of this Section), provided, that the Trustees shall have no duty or
obligation to inquire or to investigate the breach by the Originator of any of
such representations or warranties. The Originator shall repurchase each such
Ineligible Contract or Excess Contract, at a repurchase price equal to the
Transfer Deposit Amount, not later than the next succeeding Determination Date
following the date the Originator becomes aware of, or receives written notice
from any Trustee, the Servicer or the Trust Depositor of, any such breach or
inaccuracy and which breach or inaccuracy has not otherwise been cured;
provided, however, that if the Originator is able to effect a substitution for
any such Ineligible Contract or Excess Contract in compliance with Section 2.04,
the Originator may, in lieu of repurchasing such Contract, effect a substitution
for such affected Contract with a Substitute Contract not later than the date a
repurchase of such affected Contract would be required hereunder, and provided
further that with respect to a breach of representation or warranty relating to
the Contracts in the aggregate and not to any particular Contract the Originator
may select Contracts (without adverse selection) to repurchase (or substitute
for) such that had such Contracts not been included as part of the Trust Assets
(and, in the case of a substitution, had such Substitute Contract been included
as part of the Trust Assets instead of the selected Contract) there would have
been no breach of such representation or warranty. Notwithstanding any other
provision of this Agreement, the obligation of the Originator described in this
Section 11.01 shall not (a) terminate or be deemed released by any party hereto
upon a Servicer Transfer pursuant to Article VIII or (b) include any obligation
to make payment on account of a breach of a Contract by an Obligor subsequent to
the date on which such Contract was transferred to the Trust. The repurchase
obligation described in this Section 11.01 is in no way to be satisfied with
monies in the Reserve Fund.
SECTION 11.02. REASSIGNMENT OF REPURCHASED OR SUBSTITUTED
CONTRACTS. Upon receipt by the Indenture Trustee for deposit in the Collection
Account of the amounts described in Section 11.01 or Section 11.03 (or upon the
Subsequent Transfer Date related to a Substitute Contract described in Section
11.01), and upon receipt of a certificate of a Servicing Officer in the form
attached hereto as Exhibit F, the
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Indenture Trustee shall assign to the Trust Depositor and the Trust Depositor
shall assign to the Originator all of the Trust's (or Trust Depositor's, as
applicable) right, title and interest in the repurchased or substituted Contract
and related Trust Assets without recourse, representation or warranty. Such
reassigned Contract shall no longer thereafter be included in any calculations
of Principal Balances required to be made hereunder or otherwise be deemed a
part of the Trust.
SECTION 11.03. ORIGINATOR'S AND TRUST DEPOSITOR'S REPURCHASE
OPTION. On written notice to the Owner Trustee and the Indenture Trustee at
least 20 days prior to a Distribution Date, and provided that the Pool Balance
of all Contracts in the Contracts Pool is then less than 10% of the Pool Balance
of such Contracts as of the Initial Cutoff Date, the Originator, through the
Trust Depositor, may (but is not required to) repurchase from the Trust
Depositor (and the Trust Depositor concurrently from the Trust) on that
Distribution Date all outstanding Contracts at a price equal to the aggregate
outstanding Principal Amount of the Securities (other than the Certificates) and
accrued and unpaid interest thereon as of the current Distribution Date thereon,
the amount of Unreimbursed Servicer Advances (if any exist that have not been
effectively waived and released by the Servicer) as well as accrued and unpaid
monthly Servicing Fees and any unpaid fees, expenses (including legal fees and
expenses) or other payments owed to the Indenture Trustee under the Indenture to
the date of such repurchase. Such price is to be deposited in the Collection
Account not later than one Business Day before such Distribution Date, against
the Owner Trustee's and Indenture Trustee's and Trust Depositor's release of the
Contracts and the Contract Files to the Originator.
ARTICLE TWELVE
ORIGINATOR INDEMNITIES
SECTION 12.01. ORIGINATOR'S INDEMNIFICATION. The Originator will
defend and indemnify the Trust Depositor, the Trust, the Trustees, any agents of
the Trustees and the Certificateholder and Noteholders (any of which, an
"Indemnified Party") against any and all costs, expenses, losses, damages,
claims and liabilities, joint or several, including reasonable fees and expenses
of counsel and expenses of litigation (collectively, "Costs") arising out of or
resulting from (i) this Agreement the Transaction Documents or any document or
transaction contemplated in connection herewith or therewith or the use,
ownership or operation of any Equipment by the Originator or the Servicer or any
Affiliate of either, (ii) any representation or warranty or covenant made by the
Originator in this Agreement being untrue or incorrect (subject to the
limitations described in the preamble to Article Three of this Agreement), and
(iii) any untrue statement or alleged untrue statement of a material fact
contained in the Prospectus or in any amendment thereto or the omission or
alleged omission to state therein a material fact necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged
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untrue statement was made in conformity with information furnished to Trust
Depositor by the Originator specifically for use therein; provided, however,
that the Originator shall not be required to so indemnify any such Indemnified
Party for such Costs to the extent that such Cost shall be due to or arise from
the willful misfeasance, bad faith or negligence of such Indemnified Party, or
the failure of such Indemnified Party to comply with any express undertaking,
agreement or covenant made by such Indemnified Party in a Transaction Document
to which it is a party or the breach subsequent to the Closing Date by an
Obligor under a Contract. Notwithstanding any other provision of this Agreement,
the obligation of the Originator under this Section 12.01 shall not terminate
upon a Servicer Transfer pursuant to Article Eight of this Agreement and shall
survive any termination of that agreement or this Agreement and the earlier
removal or resignation of the Indenture Trustee.
SECTION 12.02. LIABILITIES TO OBLIGORS. No obligation or
liability to any Obligor under any of the Contracts is intended to be assumed by
the Trustees, the Trust, the Noteholders or the Certificateholder under or as a
result of this Agreement and the transactions contemplated hereby.
SECTION 12.03. TAX INDEMNIFICATION.
(a) The Originator agrees to pay, and to indemnify,
defend and hold harmless the Trust Depositor, the Trust, the Trustees,
the Noteholders or the Certificateholder from, any taxes which may at
any time be asserted with respect to, and as of the date of, the
transfer of the Contracts to the Trust Depositor and the transfer by the
Trust Depositor of the Contracts to the Trust and the further pledge by
the Trust to the Indenture Trustee, including, without limitation, any
sales, gross receipts, general corporation, personal property, privilege
or license taxes (but not including any federal, state or other taxes
arising out of the creation of the Trust and the issuance of the Notes
and Certificates) and costs, expenses and reasonable counsel fees in
defending against the same, whether arising by reason of the acts to be
performed by the Originator or the Servicer under this Agreement or
imposed against the Trust, a Noteholder, a Certificateholder or
otherwise. Notwithstanding any other provision of this Agreement, the
obligation of the Originator under this Section 12.03 shall not
terminate upon a Servicer Transfer pursuant to Article Eight of this
Agreement and shall survive any termination of this Agreement.
(b) The Originator agrees to pay and to indemnify, defend
and hold harmless the Trust and the Trustees, on an after-tax basis (as
hereinafter defined), from any state or local personal property taxes,
gross rent taxes, leasehold taxes or similar taxes which may at any time
be asserted with respect to the ownership of the Contracts (including
security interests therein) and the receipt of rentals therefrom by the
Trust, and costs, expenses and reasonable
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counsel fees in defending against the same, excluding, however, taxes
based upon or measured by gross or net income or receipts (other than
taxes imposed specifically with respect to rentals). As used in this
Section, the term "after-tax basis" shall mean, with respect to any
payment to be received by an indemnified person, that the amount to be
paid by the Originator shall be equal to the sum of (i) the amount to be
received without regard to this sentence, plus (ii) any additional
amount that may be required so that after reduction by all taxes imposed
under any federal, state and local law, and taking into account any
current credits or deductions arising therefrom, resulting either from
the receipt of the payments described in both clauses (i) and (ii)
hereof, such sum shall be equal to the amount described in clause (i)
above.
SECTION 12.04. ADJUSTMENTS. The Originator agrees that, with
respect to each Contract (i) which provides for a prepayment amount less than
the amount calculated in accordance with the definition thereof and (ii) as to
which the related Vendor has not agreed to indemnify the Trust Depositor or any
assignee of the Trust Depositor in an amount at least equal to the excess of the
Prepayment Amount as calculated in accordance with the definition thereof
over the amount otherwise payable upon prepayment of such Contract, the
Originator shall indemnify the Trust Depositor or the Trust as assignee thereof,
in an amount equal to the amount specified in the foregoing clause (ii).
The Originator hereby further agrees that if any real property
collateral securing any Contract described in Section 3.02(e) hereof becomes the
subject of any claims, proceedings, liens or encumbrances with respect to any
material violation or claimed material violation of any federal or state
environmental laws or regulations, such Contract shall for all purposes
hereunder be, at and following the time of discovery by the Originator, the
Trust Depositor, the Servicer or any Trustee (it being understood and agreed
that such trustee is under no duty of investigation) of such fact, deemed an
Ineligible Contract subject to the same remedial and recourse provisions
hereunder as other Contracts determined to be Ineligible Contracts hereunder.
SECTION 12.05. OPERATION OF INDEMNITIES. Indemnification under
this Article Twelve shall include, without limitation, reasonable fees and
expenses of counsel and expenses of litigation. If the Originator has made any
indemnity payments to the Trust Depositor or the Trustees pursuant to this
Article Twelve and the Trust Depositor or the Trustees thereafter collects any
of such amounts from others, the Trust Depositor or the Trustees will repay such
amounts collected to the Originator, except that any payments received by the
Trust Depositor or the Trustees from an insurance provider as a result of the
events under which the Originator's indemnity payments arose shall be repaid
prior to any repayment of the Originator's indemnity payment.
ARTICLE THIRTEEN
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MISCELLANEOUS
SECTION 13.01. AMENDMENT.
(a) This Agreement may be amended by the Originator, the Trust
Depositor, the Servicer, the Indenture Trustee and the Owner Trustee on behalf
of the Trust, collectively, without the consent of any Securityholders, to cure
any ambiguity, to correct or supplement any provisions in this Agreement which
are inconsistent with the provisions herein, or to add any other provisions with
respect to matters or questions arising under this Agreement that shall not be
inconsistent with the provisions of this Agreement, provided, however that any
such action shall not, as evidenced by an Opinion of Counsel, adversely affect
in any material respect the interests of any Securityholder.
(b) This Agreement may also be amended from time to time by the
Originator, the Trust Depositor, the Servicer, the Indenture Trustee and the
Owner Trustee on behalf of the Trust, with the consent of the Required Holders,
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders or the Certificateholder; provided,
however, that no such amendment shall (i) increase or reduce in any manner the
amount of, or accelerate or delay the timing of or change the method of
calculating (A) Collections of payments on the Contracts or distributions that
shall be required to be made on any Note or Certificate (including by way of
amendment of related definitions), or (B) the manner in which the Reserve Fund
is applied, or (ii) change in any manner (including through amendment of related
definitions), the Holders which are required to consent to any such amendment,
or (iii) make any Note or Certificate payable in money other than Dollars,
without the consent of the Holders of all Notes and Certificates of the relevant
affected Class then outstanding.
(c) Prior to the execution of any such amendment or consent, the
Indenture Trustee shall furnish written notification of the substance of such
amendment or consent, together with a copy thereof, to each Rating Agency.
(d) Promptly after the execution of any such amendment or
consent, the Owner Trustee and the Indenture Trustee, as the case may be, shall
furnish written notification of the substance of such amendment or consent to
each Certificateholder and Noteholder, respectively. It shall not be necessary
for the consent of Noteholders and Certificateholder pursuant to Section
13.01(b) to approve the particular form of any proposed amendment or consent,
but it shall be sufficient if such consent shall approve the substance thereof.
The manner of obtaining such consents and of evidencing the authorization by
Noteholders and Certificateholder of the execution thereof shall be subject to
such reasonable requirements as the Owner Trustee or the Indenture Trustee may
prescribe.
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(e) Prior to the execution of any amendment to this Agreement,
the Owner Trustee and the Indenture Trustee shall be entitled to receive and
conclusively rely upon an Opinion of Counsel stating that the execution of such
amendment is authorized and permitted by this Agreement. Such Trustee may, but
shall not be obligated to, enter into any such amendment which affects such
Trustee's own rights, duties, indemnities or immunities under this Agreement or
otherwise.
(f) Notwithstanding anything to the contrary in this Section
13.01, the Trust Depositor or the Servicer, acting on behalf of the Trust
Depositor, may request each Rating Agency to approve a formula for determining
the Required Reserve Amount that is different from the formula or result
determined from the current definition thereof contained herein so as to result
in a decrease in the amount of the Required Reserve Amount or the manner by
which such Reserve Fund is funded. If each Rating Agency delivers to the
Indenture Trustee and Owner Trustee a written notice or letter satisfying the
Rating Agency Condition in connection with such change, then the Required
Reserve Amount will be theretofore determined in accordance with such changed
formula or manner of funding, and an amendment to this Agreement effecting such
change may be executed without the consent of any Securityholders.
SECTION 13.02. PROTECTION OF TITLE TO TRUST.
(a) The Servicer shall execute and file such financing statements
and cause to be executed and filed such continuation statements, all in such
manner and in such places as may be required by law fully to preserve, maintain
and protect the interest of the Trust, the Securityholders, the Indenture
Trustee and the Owner Trustee in the Contracts and in the proceeds thereof. The
Servicer shall deliver (or cause to be delivered) to the Owner Trustee and the
Indenture Trustee file-stamped copies of, or filing receipts for, any document
filed as provided above, as soon as available following such filing.
(b) Neither the Originator, the Trust Depositor nor the Servicer
shall change its name, identity or corporate structure in any manner that would,
could or might make any financing statement or continuation statement filed in
accordance with Section 4.02(a) seriously misleading within the meaning of
Section 9-402(7) of the UCC, unless it shall have given the Trust, the Owner
Trustee and the Indenture Trustee at least 30 days' prior written notice thereof
and shall have promptly filed appropriate amendments to all previously filed
financing statements or continuation statements.
(c) The Originator, the Trust Depositor and the Servicer shall
give the Trust, the Owner Trustee and the Indenture Trustee at least 30 days'
prior written notice of any relocation of the principal executive office of the
Originator, or the Trust
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Depositor or the Servicer if, as a result of such relocation, the applicable
provisions of the UCC would require filing of any amendment of any previously
filed financing or continuation statement or of any new financing statement, and
the Servicer shall promptly file or cause to be filed any such amendment or new
financing statement. The Servicer shall at all times maintain each office from
which it shall service Contracts, and its principal executive office, within the
United States.
(d) The Servicer shall maintain or cause to be maintained
accounts and records as to each Contract accurately and in sufficient detail to
permit (i) the reader thereof to know at any time the status of such Contract,
including payments and recoveries made and payments owing (and the nature of
each) and (ii) reconciliation between payments or recoveries on (or with respect
to) each Contract and the amounts from time to time deposited in or credited to
the Collection Account in respect of each Contract.
(e) The Servicer shall maintain or cause to be maintained its
computer systems so that, from and after the time of sale under this Agreement
of the Contracts, the Servicer's master computer records (including any backup
archives) that shall refer to a Contract indicate clearly the interest of the
Trust and the Indenture Trustee in such Con tract and that such Contract is
owned by the Trust and has been pledged to the Indenture Trustee. Indication of
the Trust's ownership of and the Indenture Trustee's interest in a Contract
shall be deleted from or modified on the Servicer's computer systems when, and
only when, the related Contract shall have been paid in full or repurchased or
substituted for.
(f) The Servicer shall deliver to the Owner Trustee, the
Indenture Trustee and each Rating Agency promptly after the execution and
delivery of this Agreement and of each amendment hereto, an Opinion of Counsel
either (A) stating that, in the opinion of such counsel, all financing
statements and continuation statements have been executed and filed that are
necessary fully to preserve and protect the interest of the Owner Trustee and
the Indenture Trustee and reciting the details of each filings or referring to
prior Opinions of Counsel in which such details are given, or (B) stating that,
in the opinion of such counsel, no such action shall be necessary to preserve
and protect such interest.
SECTION 13.03. GOVERNING LAW. (a) This Agreement shall be
construed in accordance with the laws of the State of New York and the
obligations, rights, and remedies of the parties under the Agreement shall be
determined in accordance with such laws, except that the duties of the Owner
Trustee shall be governed by the laws of the State of Delaware.
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(b) EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT. Each party hereto (i) certifies that no representative,
agent or attorney of any other party has represented, expressly or otherwise,
that such other party would not, in the event of litigation, seek to enforce the
foregoing waiver and (ii) acknowledges that it and the other parties hereto have
been induced to enter into this Agreement by, among other things, the mutual
waivers and certifications in this Section 13.03(b).
SECTION 13.04. NOTICES. All notices, demands, certificates,
requests and communications hereunder ("notices") shall be in writing and shall
be effective (a) upon receipt when sent through the U.S. mails, registered or
certified mail, return receipt requested, postage prepaid, with such receipt to
be effective the date of delivery indicated on the return receipt, or (b) one
Business Day after delivery to an overnight courier, or (c) on the date
personally delivered to an Authorized Officer of the party to which sent, or (d)
on the date transmitted by legible telecopier transmission with a confirmation
of receipt, in all cases addressed to the recipient as follows:
(i) If to the Servicer or Originator:
ORIX Credit Alliance, Inc.
000 Xxxxxxxx Xxx
Xxxxxxxx, Xxx Xxxxxx 00000-0000
Attention: Chief Financial Officer -
Asset Securitizations
Fax No.: (000) 000-0000
(ii) If to the Trust Depositor:
ORIX Credit Alliance Receivables II
000 Xxxxxxxx Xxx
Xxxxxxxx, Xxx Xxxxxx 00000-0000
Attention: President
Fax No.: (000) 000-0000
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(iii) If to the Indenture Trustee:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Indenture Trust Administration
Fax No.: (000) 000-0000
(iv) If to the Owner Trustee:
The Bank of New York (Delaware)
000 Xxxxx Xxxx Xxxxxx
X.X. Xxx 0000
Xxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Fax No.: (000) 000-0000
(v) If to Moody's:
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: ABS Monitoring Department
Fax No.: (000) 000-0000
(vi) If to S&P:
Standard & Poors Ratings Service
00 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Surveillance: Asset Balanced Services
Fax No.: (000) 000-0000
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(vii) If to Fitch:
Fitch IBCA, Inc.
Xxx Xxxxx Xxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Asset Backed Securities Group
Fax No.: (000) 000-0000
(viii) If to the Underwriter:
First Union Securities, Inc.
Xxx Xxxxx Xxxxx Xxxxxx, XX-0
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Asset Securitization Division
Fax No.: (000) 000-0000
Each party hereto may, by notice given in accordance herewith to each of the
other parties hereto, designate any further or different address to which
subsequent notices shall be sent.
SECTION 13.05. SEVERABILITY OF PROVISIONS. If one or more of
the covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Notes or
Certificates or the rights of the Holders thereof.
SECTION 13.06. THIRD PARTY BENEFICIARIES. Except as otherwise
specifically provided herein, the parties hereto hereby manifest their intent
that no third party, other than each Trustee, shall be deemed a third party
beneficiary of this Agreement, and specifically that the Obligors are not third
party beneficiaries of this Agreement.
SECTION 13.07. COUNTERPARTS. This Agreement may be executed by
facsimile signature and in several counterparts, each of which shall be an
original and all of which shall together constitute but one and the same
instrument.
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SECTION 13.08. HEADINGS. The headings of the various Articles
and Sections herein are for convenience of reference only and shall not define
or limit any of the terms or provisions hereof.
SECTION 13.09. NO BANKRUPTCY PETITION; DISCLAIMER. (a) Each of
the Originator, the Indenture Trustee, the Servicer, the Trust acting through
the Owner Trustee and each Holder (by acceptance of the applicable Securities)
covenants and agrees that, prior to the date that is one year and one day after
the payment in full of all amounts owing in respect of all outstanding
Securities, it will not institute against the Trust Depositor, or the Trust, or
join any other Person in instituting against the Trust Depositor or the Trust,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other similar proceedings under the laws of the United States or
any state of the United States, provided, however, that nothing herein shall
prohibit the Indenture Trustee from filing proofs of claim or otherwise
participating in any such proceedings instituted by any other Person. This
Section 13.09 will survive the termination of this Agreement.
(b) The Trust acknowledges and agrees that the Certificates
represent a beneficial interest in the Trust and Trust Assets only and the
Securities do not represent an interest in any assets (other than the Trust
Assets) of the Trust Depositor (including by virtue of any deficiency claim in
respect of obligations not paid or otherwise satisfied from the Trust Assets and
proceeds thereof). In furtherance of and not in derogation of the foregoing, to
the extent that the Trust Depositor enters into other securitization
transactions as contemplated in Section 6.07, the Trust acknowledges and agrees
that it shall have no right, title or interest in or to any assets (or interests
therein), other than the Trust Assets, conveyed or purported to be conveyed
(whether by way of a sale, capital contribution or by the granting of a Lien) by
the Trust Depositor to any Person other than the Trust (the "Other Assets").
To the extent that notwithstanding the agreements contained in
this Section, the Trust or any Securityholder, either (i) asserts an interest in
or claim to, or benefit from any Other Assets, whether asserted against or
through the Trust Depositor or any other Person owned by the Trust Depositor, or
(ii) is deemed to have any interest, claim or benefit in or from any Other
Assets, whether by operation of law, legal process, pursuant to applicable
provisions of Insolvency Laws or otherwise (including without limitation
pursuant to Section 1111(b) of the federal Bankruptcy Code, as amended) and
whether deemed asserted against or through the Trust Depositor or any other
Person owned by the Trust Depositor, then the Trust and each Securityholder by
accepting a Note or Certificate further acknowledges and agrees that any such
interest, claim or benefit in or from the Other Assets is and shall be expressly
subordinated to the indefeasible payment in full of all obligations and
liabilities of the Trust Depositor which, under the terms of the documents
relating to the securitization of the 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
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a priority of distribution under applicable law, including Insolvency Laws, and
whether asserted against the Trust Depositor or any other Person owned by the
Trust Depositor) including, without limitation, 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. Each Securityholder is deemed to have acknowledged and
agreed that no adequate remedy at law exists for a breach of this Section 13.09
and that the terms and provisions of this Section 13.09 may be enforced by an
action for specific performance.
(c) The provisions of this Section 13.09 shall be for the
third party benefit of those entitled to rely thereon and shall survive the
termination of this Agreement.
SECTION 13.10. JURISDICTION. Any legal action or proceeding
with respect to this Agreement may be brought in the courts of the United States
for the Southern District of New York, and by execution and delivery of this
Agreement, each party hereto consents, for itself and in respect of its
property, to the non-exclusive jurisdiction of those courts. Each such party
irrevocably waives any objection, including any objection to the laying of venue
or based on the grounds of forum non conveniens, which it may now or hereafter
have to the bringing of any action or proceeding in such jurisdiction in respect
of this Agreement or any document related hereto.
SECTION 13.11. TAX CHARACTERIZATION. Notwithstanding the
provisions of Section 2.01 and Section 2.04 hereof, the Trust Depositor and
Owner Trustee agree that pursuant to Treasury Regulations Section
301.7701-3(b)(1)(ii), the Trust is to be disregarded as a separate entity from
the Trust Depositor for federal and State of New Jersey income tax purposes.
SECTION 13.12. PROHIBITED TRANSACTIONS WITH RESPECT TO THE
TRUST. The Originator shall not:
(a) Provide credit to any Noteholder or Certificateholder for
the purpose of enabling such Noteholder or Certificateholder to
purchase Notes or Certificates, respectively;
(b) Purchase any Notes or Certificates in an agency or trustee
capacity; or
(c) Except in its capacity as Servicer as provided in this
Agreement, lend any money to the Trust.
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SECTION 13.13. MERGER OR CONSOLIDATION OF ORIGINATOR OR
SERVICER. (a) Each of the Originator and the Servicer will keep in full force
and effect its existence, rights and franchise as a New York corporation, and
each of the Originator and the Servicer will obtain and preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement and of any of the Contracts and to perform its
duties under this Agreement.
(b) Any person into which the Originator or the Servicer, as
the case may be, may be merged or consolidated, or any corporation resulting
from such merger or consolidation to which the Originator or the Servicer, as
the case may be, is a party, or any person succeeding by acquisition or transfer
to substantially all of the assets and the business of the Originator or the
Servicer, as the case may be, shall be the successor to the Originator or the
Servicer, as the case may be, hereunder, without execution or filing of any
paper or any further act on the part of any of the parties hereto,
notwithstanding anything herein to the contrary.
(c) Upon the merger or consolidation of the Originator or the
Servicer, as the case may be, as described in this Section 13.13, the Originator
or the Servicer, as the case may be, shall provide the Indenture Trustee and the
Rating Agencies notice of such merger, consolidation or transfer of
substantially all of the assets and business within thirty (30) days after
completion of the same.
SECTION 13.14. ASSIGNMENT OR DELEGATION BY THE ORIGINATOR.
Except as specifically authorized hereunder, the Originator may not convey and
assign or delegate any of its rights or obligations hereunder absent the prior
written consent of the Trust Depositor and the Trustees, and any attempt to do
so without such consent shall be void.
SECTION 13.15. LIMITATION OF LIABILITY OF OWNER TRUSTEE. The
Bank of New York (Delaware) acts on behalf of the Issuer solely as Owner Trustee
hereunder and not in its individual capacity, and all Persons having any claim
against the Trust by reason of the transactions contemplated by this Agreement
or any other Transaction Document shall look only to the Trust Estate under the
Trust Agreement for payment or satisfaction thereof. The Owner Trustee makes no
representations as to the validity or sufficiency of this Agreement, any other
Transaction Document or the Notes, or of any Contract or related documents. The
Owner Trustee shall at no time have any responsibility or liability for or with
respect to the legality, validity and enforceability of any Contract, or the
perfection and priority of any security interest created by any Contract in any
Equipment or the maintenance of any such perfection and priority, or for or with
respect to the sufficiency of the Trust Estate under the Trust Agreement or its
ability to generate the payments to be distributed to the Certificateholder
under the Trust Agreement or the Noteholders under the Indenture, including,
without limitation, the existence, condition
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and ownership of any Equipment; the existence and enforceability of any
insurance thereon; the existence and contents of any Contract on any computer or
other record thereof; the validity of the assignment of any Contract to the
Trust or of any intervening assignment; the completeness of any Contract; the
performance or enforcement of any Contract; the compliance by the Trust
Depositor or the Servicer with any warranty or representation made under any
Transaction Document or in any related document or the accuracy of any such
warranty or representation; or any action of the Administrator, the Indenture
Trustee or the Servicer or any subservicer taken in the name of the Owner
Trustee or the Issuer.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers as of the day and
year first above written.
ORIX CREDIT ALLIANCE RECEIVABLES TRUST 1999-A
By: THE BANK OF NEW YORK (DELAWARE), not in its
individual capacity but solely as Owner Trustee on behalf of
the Trust
By:
Printed Name:
Title:
ORIX CREDIT ALLIANCE RECEIVABLES
CORPORATION II, as Trust Depositor
By:
Printed Name:
Title:
ORIX CREDIT ALLIANCE, INC., as Servicer and as Originator
By:
Printed Name:
Title:
XXXXXX TRUST AND SAVINGS BANK, not in its individual
capacity but solely as Indenture Trustee
By:
Printed Name:
Title:
99
106
EXHIBIT A
FORM OF ASSIGNMENT
In accordance with the Transfer and Servicing Agreement (the
"Transfer and Servicing Agreement") dated as of November , 1999 made by and
between the undersigned, as Trust Depositor ("Trust Depositor"), ORIX Credit
Alliance, Inc., as Servicer and as Originator, Xxxxxx Trust and Savings Bank, as
Indenture Trustee and the ORIX Credit Alliance Receivables Trust 1999-A (the
"Trust"), as assignee thereunder, the undersigned does hereby sell, transfer,
convey and assign, set over and otherwise convey to the Trust (i) all the right,
title and interest of the Trust Depositor in and to the Initial Contracts listed
on the initial List of Contracts delivered on the Closing Date (including,
without limitation, all rights to receive Collections with respect thereto on or
after the Initial Cutoff Date, but excluding any rights to receive payments
which were collected pursuant thereto prior to the Initial Cutoff Date), and
(ii) all other Contract Assets relating to the foregoing.
Capitalized terms used herein have the meaning given such
terms in the Transfer and Servicing Agreement.
This Assignment is made pursuant to and in reliance upon the
representation and warranties on the part of the undersigned contained in
Article III of the Agreement and no others.
IN WITNESS WHEREOF, the undersigned has caused this Assignment
to be duly executed this th day of November, 1999.
ORIX CREDIT ALLIANCE RECEIVABLES
CORPORATION II
By:
Printed Name:
Title:
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EXHIBIT B
FORM OF CLOSING CERTIFICATE OF TRUST DEPOSITOR
ORIX CREDIT ALLIANCE RECEIVABLES CORPORATION II
OFFICER'S CERTIFICATE
The undersigned certifies that he/she is [ __] of ORIX Credit
Alliance Receivables Corporation II, a Delaware corporation (the "Trust
Depositor"), and that as such is duly authorized to execute and deliver this
certificate on behalf of the Trust Depositor in connection with the Transfer and
Servicing Agreement (the "Agreement") dated as of November , 1999 (the
"Effective Date") by and among the Trust Depositor, Xxxxxx Trust and Savings
Bank (the "Indenture Trustee"), as Indenture Trustee, ORIX Credit Alliance, Inc.
("OCAI"), as Servicer and as Originator, and the ORIX Credit Alliance
Receivables Trust 1999-A ("Trust") (all capitalized terms used herein without
definition having the respective meanings set forth in the Agreement), and
further certifies as follows:
(1) Attached hereto as Exhibit I is a true and
correct copy of the Certificate of Incorporation of the Trust
Depositor, together with all amendments thereto as in effect on the
date hereof.
(2) There has been no other amendment or other
document filed affecting the Certificate of Incorporation of the Trust
Depositor since November , 1999 and no such amendment has been
authorized by the Board of Directors or shareholders of the Trust
Depositor.
(3) Attached hereto as Exhibit II is a Certificate of
the Secretary of State of the State of Delaware dated November , 1999
stating that the Trust Depositor is duly incorporated under the laws of
the State of Delaware and is in good standing.
(4) Attached hereto as Exhibit III is a true and
correct copy of the Bylaws of the Trust Depositor, as amended, which
were in full force and effect on November , 1999, and at all times
subsequent thereto.
(5) Attached hereto as Exhibit IV is a true and
correct copy of resolutions adopted pursuant to the unanimous written
consent of the Board of Directors of the Trust Depositor relating to
the execution, delivery and performance of (among other things) the
Agreement; the Trust Agreement dated as of the Effective Date between
the Trust Depositor and The Bank of New York
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(Delaware) (the "Owner Trustee"), as Owner Trustee; the Administration
Agreement dated as of the Effective Date among the Trust Depositor, the
Trust, the Indenture Trustee, and OCAI, as Administrator; and the
Underwriting Agreement (as defined in the Agreement) (collectively, the
"Transaction Agreements"). Said resolutions have not been amended,
modified, annulled or revoked, and are on the date hereof in full force
and effect and are the only resolutions relating to these matters which
have been adopted by the Board of Directors.
(6) No event with respect to the Trust Depositor has
occurred and is continuing which would constitute an Event of Default
or an event that, with notice or the passage of time or both, would
become an Event of Default as defined in the Agreement. To the best of
my knowledge after reasonable investigation, there has been no
material adverse change in the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the Trust
Depositor, whether or not arising in the ordinary course of business
since the respective dates as of which information is given in the
Prospectus and except as set forth therein.
(7) All federal, state and local taxes of the Trust
Depositor due and owing as of the date hereof have been paid.
(8) All representations and warranties of the Trust
Depositor contained in the Transaction Agreements or any other related
documents, or in any document, certificate or financial or other
statement delivered in connection therewith are true and correct as of
the date hereof.
(9) There is no action, investigation or proceeding
pending or, to our knowledge, threatened against the Trust Depositor
before any court, administrative agency or other tribunal (a) asserting
the invalidity of the Transaction Agreements; (b) seeking to prevent
the consummation of any of the transactions contemplated by the
Transaction Agreements; or (c) which is likely materially and adversely
to affect the Trust Depositor's performance of its obligations under,
or the validity or enforceability of, the Transaction Agreements.
(10) No consent, approval, authorization or order of,
and no notice to or filing with, any governmental agency or body or
state or federal court is required to be obtained by the Trust
Depositor for the Trust Depositor's consummation of the transactions
contemplated by the Transaction Agreements, except such as have been
obtained or made and such as may be required under the blue sky laws of
any jurisdiction in connection with the issuance and sale of the
Securities.
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(11) The Trust Depositor is not a party to any
agreements or instruments evidencing or governing indebtedness for
money borrowed or by which the Trust Depositor or its property is bound
(other than the Transaction Agreements). Neither the Originator's
transfer and assignment of the Contract Assets to the Trust Depositor,
the Trust Depositor's concurrent transfer and assignment of the Trust
Assets to the Trust, nor the concurrent transfer and assignment of the
Collateral by the Trust to the Indenture Trustee nor the issuance and
sale of the Certificates and the Notes, nor the execution and delivery
of the Transaction Agreements, nor the consummation of any other of the
transactions contemplated therein, will violate or conflict with any
agreement or instrument to which the Trust Depositor is a party or by
which it is otherwise bound.
(12) In connection with the transfer of Contracts and
related collateral contemplated in the Agreement, (a) the Trust
Depositor has not made such transfer with actual intent to hinder,
delay or defraud any creditor of the Trust Depositor, and (b) the Trust
Depositor has not received less than a reasonably equivalent value in
exchange for such transfer, is not on the date thereof insolvent (nor
will become insolvent as a result thereof), is not engaged (or about to
engage) in a business or transaction for which it has unreasonably
small capital, and does not intend to incur or believe it will incur
debts beyond its ability to pay when matured.
(13) Each of the agreements and conditions of the
Trust Depositor to be performed on or before the Closing Date pursuant
to the Transaction Agreements have been performed in all material
respects.
* * * *
In Witness Whereof, I have affixed my signature hereto this th
day of November, 1999.
By:
Printed Name:
Title:
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EXHIBIT C
[FORM OF CLOSING CERTIFICATE OF SERVICER/ORIGINATOR]
ORIX CREDIT ALLIANCE, INC.
OFFICER'S CERTIFICATE
The undersigned certifies that he/she is __ of ORIX Credit
Alliance, Inc. ("OCAI"), and that as such he/she is duly authorized to execute
and deliver this certificate on behalf of OCAI, as Servicer, in connection with
the Transfer and Servicing Agreement (the "Agreement") dated as of November ,
1999 (the "Effective Date") by and among OCAI, as Servicer and Originator, ORIX
Credit Alliance Receivables Corporation II ("OCARC"), Xxxxxx Trust and Savings
Bank as Indenture Trustee, and ORIX Credit Alliance Receivables Trust
1999-A ("Trust"), and as the Originator (all capitalized terms used herein
without definition having the respective meanings set forth in the Agreement),
and further certifies as follows (it being understood that these certifications
are being relied upon by, among others, Xxxxxxxx & Xxxxxxxx in connection with
its delivery of a legal opinion (the "Opinion") required in connection with the
subject transactions addressing, among other things, enforceability and UCC
perfection issues, and by the Underwriters in connection with their undertakings
in connection with the subject transactions):
(1) Attached hereto as Exhibit I is a true and
correct copy of the Certificate of Incorporation of OCAI, together with
all amendments thereto as in effect on the date hereof.
(2) There has been no other amendment or other
document filed affecting the Certificate of Incorporation of OCAI since
, 199 , and no such amendment has been authorized by the Board
of Directors or shareholders of OCAI.
(3) Attached hereto as Exhibit II is a Certificate
of the Secretary of State of the State of New York dated November ,
1999 stating that OCAI is duly incorporated under the laws of the State
of New York and is in good standing.
(4) Attached hereto as Exhibit III is a true and
correct copy of the Bylaws of OCAI which were in full force and effect
on November , 1999 and at all times subsequent thereto.
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(5) Attached hereto as Exhibit IV is a true and correct
copy of resolutions adopted pursuant to a unanimous written consent of
the Executive Committee of the Board of Directors of OCAI and relating
to the authorization, execution, delivery and performance of (among
other things) the Agreement; the Underwriting Agreements (as defined in
the Agreement); and the Administration Agreement dated as of the
Effective Date among OCAI, OCARC, the Trust and Xxxxxx Trust and
Savings Bank as Indenture Trustee (the "Indenture Trustee") (the
"Administration Agreement"). Said resolutions have not been amended,
modified, annulled or revoked, and are on the date hereof in full force
and effect and are the only resolutions relating to these matters which
have been adopted by the Board of Directors.
(6) No event with respect to OCAI has occurred and is
continuing which would constitute an Event of Default or Servicer
Default or an event that, with notice or the passage of time, would
constitute an Event of Default or Servicer Default as defined in the
Transfer and Servicing Agreement. To the best of my knowledge after
reasonable investigation, there has been no material adverse change in
the condition, financial or otherwise, or the earnings, business
affairs or business prospects of OCAI, whether or not arising in the
ordinary course of business, since the respective dates as of which
information is given in the Prospectus and except as set forth therein.
(7) All federal, state and local taxes of OCAI due
and owing as of the date hereof have been paid.
(8) All representations and warranties of OCAI
contained in the Agreement, the Underwriting Agreements and the
Administration Agreement (collectively, the "Transaction Agreements")
or in any document, certificate or financial or other statement
delivered in connection therewith are true and correct as of the date
hereof.
(9) There is no action, investigation or proceeding
pending or, to my knowledge, threatened against OCAI before any court,
administrative agency or other tribunal (a) asserting the invalidity of
any Transaction Agreement to which OCAI is a party; or (b) which is
likely materially and adversely to affect OCAI's performance of its
obligations under, or the validity or enforceability of, the
Transaction Agreements.
(10) No consent, approval, authorization or order of,
and no notice to or filing with, any governmental agency or body or
state or federal court is required to be obtained by OCAI for OCAI's
consummation of the transactions contemplated by the Transaction
Agreements, except such as have been obtained
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or made and such as may be required under the blue sky laws of any
jurisdiction in connection with the issuance and sale of the Notes or
Certificates.
(11) Neither OCAI's transfer and assignment of the
Contract Assets to OCARC, OCARC's concurrent transfer and assignment of
the Trust Assets to the Trust, nor the concurrent transfer and
assignment by the Trust of the Collateral to the Indenture Trustee, nor
the issuance and sale of the Notes or Certificates or the entering into
of the Transaction Agreements, nor the consummation of any other of
the transactions contemplated therein, will violate or conflict with
any agreement or instrument to which OCAI is a party or by which it is
otherwise bound.
(12) In connection with the transfers of Contracts
and related assets contemplated in the Agreement, (a) OCAI has not made
such transfer with actual intent to hinder, delay or defraud any
creditor of OCAI, and (b) OCAI has not received less than a reasonably
equivalent value in exchange for such transfer, is not on the date
hereof insolvent (nor will OCAI become insolvent as a result thereof),
is not engaged (or about to engage) in a business or transaction for
which it has unreasonably small capital, and does not intend to incur
or believe it will incur debts beyond its ability to pay when matured.
(13) Each of the agreements and conditions of OCAI to
be performed or satisfied on or before the Closing Date under the
Transaction Agreements has been performed or satisfied in all material
respects.
(14) OCAI has not executed for filing any UCC
financing statements listing the Contract Assets as collateral other
than financing statements relating to the transactions contemplated in
the Agreement.
* * * * * *
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In Witness Whereof, I have affixed my signature hereto this
th day of November, 1999.
By:
Printed Name:
Title:
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EXHIBIT D
FORM OF OPINION OF COUNSEL FOR TRUST DEPOSITOR
REGARDING GENERAL CORPORATE MATTERS
(INCLUDING PERFECTION OPINION)
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EXHIBIT E
FORM OF OPINION OF COUNSEL FOR TRUST
DEPOSITOR REGARDING THE "TRUE SALE" NATURE
OF THE TRANSACTION AND REGARDING NON-CONSOLIDATION
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EXHIBIT F
FORM OF CERTIFICATE REGARDING REPURCHASED CONTRACTS
ORIX CREDIT ALLIANCE, INC.
CERTIFICATE REGARDING REPURCHASED CONTRACTS
The undersigned certifies that he/she is a
__ of ORIX Credit Alliance, Inc., a New York corporation (the
"Servicer"), and that as such he/she is duly authorized to execute and deliver
this certificate on behalf of the Servicer pursuant to Section 11.02 of the
Transfer and Servicing Agreement (the "Agreement") dated as of November , 1999
by and among ORIX Credit Alliance Receivables Corporation II, as Trust
Depositor, the Servicer, ORIX Credit Alliance, Inc. as Originator, Xxxxxx Trust
and Savings Bank, as Indenture Trustee, and ORIX Credit Alliance Receivables
Trust 1999-A (all capitalized terms used herein without definition having the
respective meanings specified in the Agreement), and further certifies that:
1. The Contracts on the attached schedule are to be repurchased
by the Originator on the date hereof, or substituted for by
the Originator, pursuant to and in accordance with Section
11.01 of the Agreement.
2. Upon deposit of the Transfer Deposit Amount for such Contracts
(or the effective conveyance of one or more Substitute
Contracts therefor), such Contracts may, pursuant to Section
11.02 of the Agreement, be assigned by the Owner Trustee to
the Originator.
IN WITNESS WHEREOF, I have affixed hereunto my signature this
day of , _.
ORIX CREDIT ALLIANCE, INC.
By:
Printed Name:
Title:
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EXHIBIT G
LIST OF CONTRACTS
G-1
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EXHIBIT H
[FORM OF MONTHLY REPORT TO NOTEHOLDERS AND CERTIFICATEHOLDERS]
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EXHIBIT I
FORM OF SUBSEQUENT TRANSFER AGREEMENT
SUBSEQUENT TRANSFER AGREEMENT (the "Agreement"), dated as of
[__], by and among ORIX Credit Alliance Receivables Trust 1999-A (the "Trust"),
ORIX Credit Alliance Receivables Corporation II, a Delaware corporation (the
"Trust Depositor"), Xxxxxx Trust and Savings Bank, as Indenture Trustee (the
"Indenture Trustee") and ORIX Credit Alliance, Inc., a Delaware corporation, as
Servicer and as Originator, pursuant to the Transfer and Servicing Agreement
referred to below.
WITNESSETH:
WHEREAS, the Trust, the Trust Depositor, the Servicer, the
Originator and the Indenture Trustee, are parties to the Transfer and Servicing
Agreement, dated as of November , 1999 (the "Transfer and Servicing Agreement");
WHEREAS, pursuant to the Transfer and Servicing Agreement, the
Trust Depositor wishes to sell the Substitute Contracts to the Trust, and the
Trust wishes to purchase the same, for the consideration described in the
Transfer and Servicing Agreement; and
WHEREAS, the Servicer has timely delivered an Addition Notice
related to such conveyance as required in by Section 2.04(b) of the Transfer and
Servicing Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Capitalized terms used herein shall have the
meanings ascribed to them in the Transfer and Servicing Agreement unless
otherwise defined herein.
"Subsequent Cutoff Date" shall mean, with respect to
the Substitute Contracts transferred hereby, .
"Substitute Contracts" shall mean, for purposes of
this Agreement, the Substitute Contracts listed in the
Subsequent List of Contracts attached hereto as Exhibit A.
"Subsequent Transfer Date" shall mean, with respect
to the Substitute Contracts transferred hereby, .
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SECTION 2. SUBSEQUENT LIST OF CONTRACTS. The Subsequent List
of Contracts attached hereto as Exhibit A is an amendment to the initial List of
Contracts attached as Exhibit G to the Transfer and Servicing Agreement, as
contemplated in the definition of List of Contracts set forth therein. The
Subsequent List of Contracts separately identifies the Substitute Contracts to
be transferred pursuant to this Agreement on the Subsequent Transfer Date, and
also further separately identifies the related Contract or Contracts with
respect to which a Substitution Event has occurred and which Contracts are being
deleted from the List of Contracts by virtue of the delivery of the Subsequent
List of Contracts.
SECTION 3. TRANSFER OF SUBSTITUTE CONTRACTS. Subject to and
upon the terms and conditions set forth in Section 2.04(b) of the Transfer and
Servicing Agreement and this Agreement, the Trust Depositor hereby sells,
transfers, assigns, sets over and otherwise conveys to the Trust all of the
Trust Depositor's rights, title and interest in:
(i) the Substitute Contracts identified in the
related Addition Notice, and all monies received in payment of
such Contracts on and after the related Subsequent Cutoff
Dates, any Prepayment Amounts, any payments in respect of a
casualty or early termination, and any Recoveries received
with respect thereto, but excluding any Excluded Amounts;
(ii) the Equipment related to such Contracts,
including all proceeds from any sale or other disposition of
such Equipment (but subject to the exclusion and release
herein of Excluded Amounts);
(iii) the Contract Files;
(iv) all payments made or to be made in the future
with respect to such Contracts or the Obligor thereunder under
any Vendor Assignments with the Originator;
(v) all Insurance Proceeds with respect to each such
Contract;
(vi) all rights (but not the obligations) of the
Trust Depositor under the Transfer and Servicing Agreement
related to such Contracts (to the extent not already conveyed
under Section 2.01(b) of the Transfer and Servicing
Agreement), as well as all rights, but not the obligations, of
the Trust Depositor under the Subsequent Purchase Agreement
related to such Contracts; and
(vii) all income from and proceeds of the foregoing.
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It is the intention of the Trust Depositor and Owner Trustee that the transfer
contemplated by this Agreement shall constitute an absolute assignment and sale
of the Substitute Contracts from the Trust Depositor to the Trust, conveying
good title thereto free and clear of any Liens.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE TRUST
DEPOSITOR. (a) The Trust Depositor hereby represents and warrants to the Trust
that the representations and warranties of the Trust Depositor set forth in
Section 3.06 of the Transfer and Servicing Agreement are true and correct as of
the Subsequent Transfer Date.
(b) The Trust Depositor hereby repeats and remakes with
respect to the Substitute Contracts as of the Subsequent Transfer Date the
representations and warranties set forth in Section 3.01 of the Transfer and
Servicing Agreement and deemed to be made with respect to the Substitute
Contracts thereunder.
(c) The Trust Depositor hereby represents and warrants that
(a) the Pool Balance of the Substitute Contracts listed on the Subsequent List
of Contracts and conveyed to the Trust Depositor pursuant to this Agreement is
$ as of the Subsequent Cutoff Date, and (b) the conditions set forth in
Section 2.04(b) of the Transfer and Servicing Agreement have been satisfied as
of the Subsequent Transfer Date.
SECTION 5. RATIFICATION OF AGREEMENT. As supplemented by this
Agreement, the Transfer and Servicing Agreement is in all respects ratified and
confirmed and, as so supplemented by this Agreement, shall be read, taken and
construed as one and the same instrument.
SECTION 6. COUNTERPARTS. This Agreement may be executed by
facsimile signatures and in two or more counterparts (and by different parties
in separate counterparts), each of which shall be an original but all of which
together shall constitute one and the same instrument.
SECTION 7. GOVERNING LAW. This Agreement shall be construed in
accordance with the laws of the State of New York, and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
SECTION 8. AUTHORIZATION OF TRUSTEE. By its execution hereof,
the Trust Depositor hereby authorizes and directs the Owner Trustee to execute
and deliver this Agreement on behalf of the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the date first written above.
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ORIX CREDIT ALLIANCE RECEIVABLES
CORPORATION II
By:
Printed Name:
Title:
ORIX CREDIT ALLIANCE, INC., as Servicer and as
Originator
By:
Printed Name:
Title:
ORIX CREDIT ALLIANCE RECEIVABLES TRUST
1999-A
By: THE BANK OF NEW YORK (DELAWARE), not
in its individual capacity but solely as Owner
Trustee on behalf of the Trust
By:
Printed Name:
Title:
XXXXXX TRUST AND SAVINGS BANK, not in its
individual capacity but solely as Indenture Trustee
By:
Printed Name:
Title:
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EXHIBIT J
[FORM OF SUBSEQUENT PURCHASE AGREEMENT]
SUBSEQUENT PURCHASE AGREEMENT (the "Agreement"), dated
as of [ __], [ _], by and among ORIX Credit Alliance Receivables Corporation II,
a Delaware corporation (the "Trust Depositor"), and ORIX Credit Alliance, Inc.,
a Delaware corporation ("OCAI" or the "Originator"), pursuant to the Transfer
and Servicing Agreement referred to below.
WITNESSETH:
WHEREAS, the Trust Depositor and the Originator are parties to
the Transfer and Servicing Agreement, dated as of November , 1999 (the
"Transfer and Servicing Agreement");
WHEREAS, pursuant to the Transfer and Servicing Agreement, the
Originator wishes to sell the Substitute Contracts to the Trust Depositor, and
the Trust Depositor wishes to purchase the same, for the purchase price set
forth in Section 3 below; and
WHEREAS, the Originator has timely delivered an Addition
Notice related to such conveyance as required in the Transfer and Servicing
Agreement).
NOW, THEREFORE, the Originator and the Trust Depositor, hereby
agree as follows:
SECTION 1. DEFINED TERMS. Capitalized terms used herein shall
have the meanings ascribed to them in the Transfer and Servicing Agreement
unless otherwise defined herein.
"Subsequent Cutoff Date" shall mean, with respect to
the Substitute Contracts transferred hereby, .
"Substitute Contracts" shall mean, for purposes of
this Agreement, the Substitute Contracts listed in the
Subsequent List of Contracts attached hereto as Exhibit A.
"Subsequent Transfer Date" shall mean, with respect
to the Substitute Contracts transferred hereby, .
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SECTION 2. SUBSEQUENT LIST OF CONTRACTS. The Subsequent List
of Contracts attached hereto as Exhibit A is an amendment to the initial List of
Contracts attached as Exhibit G to the Transfer and Servicing Agreement, as
contemplated in the definition of List of Contracts set forth therein. The
Subsequent List of Contracts separately identifies (by attached schedule, or
marking or other effective identifying designation) the Substitute Contracts to
be transferred pursuant to this Agreement on the Subsequent Transfer Date, and
also further separately identifies (by attached schedule, or marking or other
effective identifying designation) the related Contract or Contracts with
respect to which a Substitution Event has occurred and which Contracts are being
deleted from the List of Contracts by virtue of the delivery of the Subsequent
List of Contracts.
SECTION 3. TRANSFER OF SUBSTITUTE CONTRACTS. Subject to and
upon the terms and conditions set forth in Section 2.04 of the Transfer and
Servicing Agreement and this Agreement, the Originator hereby sells, transfers,
assigns, sets over and otherwise conveys to the Trust Depositor, in
consideration of the Trust Depositor's (x) payment of $ as the purchase price
therefor, representing the prepayment proceeds received with respect to the
related Substitution Event (if applicable) or (y) release and redelivery to the
Originator of the related Contract Assets with respect to which a Substitution
Event has occurred (if applicable), all of the Originator's rights, title and
interests in:
(i) the Substitute Contracts identified in the
related Addition Notice, and all monies received in payment of
such Contracts on and after the related Subsequent Cutoff
Dates, any Prepayment Amounts, any payments in respect of a
casualty or early termination, and any Recoveries received
with respect thereto, but excluding any Excluded Amounts;
(ii) the Equipment related to such Contracts,
including all proceeds from any sale or other disposition of
such Equipment (but subject to the exclusion and release
herein of Excluded Amounts);
(iii) the Contract Files;
(iv) all payments made or to be made in the future
with respect to such Contracts or the Obligor thereunder under
any Vendor Assignments with the Originator;
(v) all Insurance Proceeds with respect to each such
Contract; and
(vi) all income from and proceeds of the foregoing.
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It is the intention of the Originator and the Trust Depositor
that the transfer contemplated by this Agreement shall constitute a sale of the
Substitute Contracts from the Originator to the Trust Depositor, conveying good
title thereto free and clear of any Liens, and that the Substitute Contracts
shall not be part of the Originator's estate in the event of the filing of a
bankruptcy petition by or against the Originator under any bankruptcy or similar
law.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE ORIGINATOR.
(a) The Originator hereby represents and warrants to the Trust Depositor that
the representations and warranties of the Originator in Section 3.01 of the
Transfer and Servicing Agreement are true and correct as of the Subsequent
Transfer Date.
(b) The Originator hereby repeats and remakes with respect to
the Substitute Contracts as of the Subsequent Transfer Date, the representations
and warranties set forth in the Transfer and Servicing Agreement and deemed to
be made with respect to such Substitute Contracts thereunder.
(c) The Originator hereby represents and warrants that (i) the
Pool Balance of the Substitute Contracts listed on the Subsequent List of
Contracts and conveyed to the Trust Depositor pursuant to this Agreement is $
as of the Subsequent Cutoff Date, and (ii) the conditions set forth in Section
2.04(b) of the Transfer and Servicing Agreement have been satisfied as of the
Subsequent Transfer Date.
SECTION 5. RATIFICATION OF AGREEMENT. As supplemented by this
Agreement, the Transfer and Servicing Agreement is in all respects ratified and
confirmed and, as so supplemented by this Agreement, shall be read, taken and
construed as one and the same instrument.
SECTION 6. COUNTERPARTS. This Agreement may be executed by
facsimile signatures and in two or more counterparts (and by different parties
in separate counterparts), each of which shall be an original but all of which
together shall constitute one and the same instrument.
SECTION 7. GOVERNING LAW. This Agreement shall be construed in
accordance with the laws of the State of New York, and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the date first written above.
ORIX CREDIT ALLIANCE RECEIVABLES
CORPORATION II
By:
Printed Name:
Title:
ORIX CREDIT ALLIANCE, INC.
By:
Printed Name:
Title:
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