1
EXHIBIT 4.1
================================================================================
INDENTURE
between
FORD CREDIT AUTO OWNER TRUST 1998-B,
as Issuer
and
THE CHASE MANHATTAN BANK,
as Indenture Trustee
Dated as of May 1, 1998
================================================================================
2
CROSS REFERENCE TABLE (1)
TIA Indenture
Section Section
------- -------
310 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.10
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.(2)
(a)(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.8;6.11
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
311 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.12
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.12
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
312 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.4
313 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.4
(b)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.4
(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.5
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.4
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.3
314 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.15
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1
(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.1
315 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.5;11.5
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.13
316 (a) (last sentence) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.8
(a)(1)(A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.11
(a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.12
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.7
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A
317 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3
318 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.7
----------------------
1 Note: This Cross Reference Table shall not, for any purpose, be
deemed to be part of this Indenture.
2 N.A. means Not Applicable.
3
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS, USAGE AND INCORPORATION BY REFERENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.1. Definitions and Usage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.2. Incorporation by Reference of
Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE II
THE NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.1. Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.2. Execution, Authentication and Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.3. Temporary Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.4. Tax Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 2.5. Registration; Registration of Transfer and Exchange . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 2.6. Mutilated, Destroyed, Lost or
Stolen Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 2.7. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 2.8. Payment of Principal and Interest;
Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.9. Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.10. Release of Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2.11. Book-Entry Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2.12. Notices to Clearing Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.13. Definitive Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.14. Authenticating Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE III
COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.1. Payment of Principal and Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.2. Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.3. Money for Payments To Be Held in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.4. Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.5. Protection of Indenture Trust Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 3.6. Opinions as to Indenture Trust Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 3.7. Performance of Obligations;
Servicing of Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 3.8. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
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SECTION 3.9. Annual Statement as to Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 3.10. Issuer May Consolidate, etc., Only on Certain Terms . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 3.11. Successor or Transferee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3.12. No Other Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3.13. No Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3.14. Servicer's Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3.15. Guarantees, Loans, Advances and
Other Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3.16. Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.17. Further Instruments and Acts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.18. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.19. Notice of Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 3.20. Removal of Administrator . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE IV
SATISFACTION AND DISCHARGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 4.1. Satisfaction and Discharge of
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 4.2. Satisfaction, Discharge and
Defeasance of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.3. Application of Trust Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 4.4. Repayment of Monies Held by
Note Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE V
REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 5.1. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 5.2. Acceleration of Maturity;
Rescission and Annulment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 5.3. Collection of Indebtedness and Suits for Enforcement by Indenture Trustee . . . . . . . . . . . . . 40
SECTION 5.4. Remedies; Priorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 5.5. Optional Preservation of the
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 5.6. Limitation of Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 5.7. Unconditional Rights of Noteholders To Receive Principal and Interest . . . . . . . . . . . . . . . 48
SECTION 5.8. Restoration of Rights and Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 5.9. Rights and Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 5.10. Delay or Omission Not a Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
ii
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SECTION 5.11. Control by Noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 5.12. Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 5.13. Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 5.14. Waiver of Stay or Extension Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 5.15. Action on Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 5.16. Performance and Enforcement of Certain Obligations . . . . . . . . . . . . . . . . . . . . . . . . . 52
ARTICLE VI
THE INDENTURE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 6.1. Duties of Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 6.2. Rights of Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 6.3. Individual Rights of Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 6.4. Indenture Trustee's Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 6.5. Notice of Defaults; Insolvency or
Dissolution of Depositor or
General Partner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 6.6. Reports by Indenture Trustee
to Noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 6.7. Compensation and Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 6.8. Replacement of Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 6.9. Successor Indenture Trustee by Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 6.10. Appointment of Co-Indenture Trustee or Separate Indenture Trustee . . . . . . . . . . . . . . . . . 62
SECTION 6.11. Eligibility; Disqualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 6.12. Preferential Collection of
Claims Against Issuer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 7.1. Issuer To Furnish Indenture Trustee Names and Addresses of Noteholders . . . . . . . . . . . . . . . 66
SECTION 7.2. Preservation of Information;
Communications to Noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 7.3. Reports by Issuer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 7.4. Reports by Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
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ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
SECTION 8.1. Collection of Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
SECTION 8.2. Trust Accounts and Payahead Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
SECTION 8.3. General Provisions Regarding Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
SECTION 8.4. Release of Indenture Trust Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 8.5. Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
ARTICLE IX
SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 9.1. Supplemental Indentures Without
Consent of Noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 9.2. Supplemental Indentures with
Consent of Noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
SECTION 9.3. Execution of Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 9.4. Effect of Supplemental Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 9.5. Conformity with Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 9.6. Reference in Notes to Supplemental
Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
ARTICLE X
REDEMPTION OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 10.1. Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 10.2. Form of Redemption Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 10.3. Notes Payable on Redemption Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
ARTICLE XI
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 11.1. Compliance Certificates and
Opinions, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 11.2. Form of Documents Delivered to
Indenture Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 11.3. Acts of Noteholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 11.4. Notices, etc., to Indenture Trustee,
Issuer and Rating Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 11.5. Notices to Noteholders; Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
iv
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Page
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SECTION 11.6. Alternate Payment and Notice
Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
SECTION 11.7. Conflict with Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 11.8. Effect of Headings and Table of
Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 11.9. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 11.10. Separability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 11.11. Benefits of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 11.12. Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 11.13. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 11.14. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 11.15. Recording of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 11.16. Trust Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 11.17. No Petition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
SECTION 11.18. Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
EXHIBIT A-1 FORM OF CLASS A-1 NOTE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . X-0-0
XXXXXXX X-0 FORM OF CLASS A-2 NOTE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . X-0-0
XXXXXXX X-0 FORM OF CLASS A-3 NOTE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . X-0-0
XXXXXXX X-0 FORM OF CLASS A-4 NOTE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . X-0-0
XXXXXXX X-0 FORM OF CLASS B NOTE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-5-1
EXHIBIT B FORM OF NOTE DEPOSITORY AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
EXHIBIT C FORM OF INVESTMENT LETTER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1
SCHEDULE A Schedule of Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SA-1
APPENDIX A Definitions and Usage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AA-1
v
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INDENTURE, dated as of May 1, 1998, (as from time to time
amended, supplemented or otherwise modified and in effect, this "Indenture")
between FORD CREDIT AUTO OWNER TRUST 1998-B, a Delaware business trust, as
Issuer, and THE CHASE MANHATTAN BANK, a New York corporation, as trustee and
not in its individual capacity (in such capacity, the "Indenture Trustee").
Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the holders of the Issuer's
Class A-1 5.615% Asset Backed Notes (the "Class A-1 Notes"), Class A-2 5.80%
Asset Backed Notes (the "Class A-2 Notes"), Class A-3 5.85% Asset Backed Notes
(the "Class A-3 Notes"), Class A-4 5.90% Asset Backed Notes (the "Class A-4
Notes" and, together with the Class A-1 Notes, the Class A-2 Notes and the
Class A-3 Notes, the "Class A Notes") and Class B 6.15% Asset Backed Notes (the
"Class B Notes" and, together with the Class A Notes, the "Notes"):
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the
Closing Date, as Indenture Trustee for the benefit of the Noteholders, all of
the Issuer's right, title and interest in, to and under, whether now owned or
existing or hereafter acquired or arising, (a) the Receivables; (b) with
respect to Precomputed Receivables, monies due thereunder on or after the
Cutoff Date (including Payaheads) and, with respect to Simple Interest
Receivables, monies due or received thereunder on or after the Cutoff Date
(including in each case any monies received prior to the Cutoff Date that are
due on or after the Cutoff Date and were not used to reduce the principal
balance of the Receivable); (c) the security interests in the Financed Vehicles
granted by Obligors pursuant to the Receivables and any other interest of the
Issuer in the Financed Vehicles; (d) rights to receive proceeds with respect to
the Receivables from claims on any physical damage, credit life, credit
disability, or other insurance policies covering Financed Vehicles or Obligors;
(e) Dealer Recourse; (f) all of the Seller's rights to the Receivable Files;
(g) the Trust Accounts and all amounts, securities, investments and other
property deposited in or credited to any of the foregoing and all proceeds
thereof; (h) the Sale and Servicing Agreement; (i) all of the Seller's rights
under the Purchase
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Agreement, including the right of the Seller to cause Ford Credit to repurchase
Receivables from the Seller; (j) payments and proceeds with respect to the
Receivables held by the Servicer; (k) all property (including the right to
receive Liquidation Proceeds) securing a Receivable (other than a Receivable
repurchased by the Servicer or purchased by the Seller); (l) rebates of
premiums and other amounts relating to insurance policies and other items
financed under the Receivables in effect as of the Cutoff Date; and (m) all
present and future claims, demands, causes of action and choses in action in
respect of any or all of the foregoing and all payments on or under and all
proceeds of every kind and nature whatsoever in respect of any or all of the
foregoing, including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all cash proceeds, accounts,
accounts receivable, notes, drafts, acceptances, chattel paper, checks, deposit
accounts, insurance proceeds, condemnation awards, rights to payment of any and
every kind and other forms of obligations and receivables, instruments and
other property which at any time constitute all or part of or are included in
the proceeds of any of the foregoing (collectively, the "Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice, priority or distinction, and to
secure compliance with the provisions of this Indenture, all as provided in
this Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the
Noteholders, acknowledges such Grant, accepts the trusts under this Indenture
in accordance with the provisions of this Indenture and agrees to perform its
duties required in this Indenture to the best of its ability to the end that
the interests of the Noteholders may be adequately and effectively protected.
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ARTICLE I
DEFINITIONS, USAGE AND INCORPORATION BY REFERENCE
SECTION 1.1. Definitions and Usage. Except as otherwise
specified herein or as the context may otherwise require, capitalized terms
used but not otherwise defined herein are defined in Appendix A hereto, which
also contains rules as to usage that shall be applicable herein.
SECTION 1.2. Incorporation by Reference of Trust Indenture
Act. Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"indenture securities" shall mean the Notes.
"indenture security holder" shall mean a Noteholder.
"indenture to be qualified" shall mean this Indenture.
"indenture trustee" or "institutional trustee" shall mean the
Indenture Trustee.
"obligor" on the indenture securities shall mean the Issuer
and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined in
the TIA, defined by TIA reference to another statute or defined by Commission
rule have the meaning assigned to them by such definitions.
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ARTICLE II
THE NOTES
SECTION 2.1. Form. (a) The Class A-1 Notes, the Class A-2
Notes, the Class A-3 Notes, the Class A-4 Notes and the Class B Notes, together
with the Indenture Trustee's certificates of authentication, shall be in
substantially the form set forth in Exhibit X-0, Xxxxxxx X-0, Exhibit X-0,
Xxxxxxx X-0 and Exhibit A-5, respectively, with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may,
consistently herewith, be determined by the officers executing such Notes, as
evidenced by their execution thereof. Any portion of the text of any Note may
be set forth on the reverse thereof, with an appropriate reference thereto on
the face of the Note.
(b) The definitive Notes shall be typewritten, printed,
lithographed or engraved or produced by any combination of these methods (with
or without steel engraved borders), all as determined by the officers executing
such Notes, as evidenced by their execution of such Notes.
(c) Each Note shall be dated the date of its authentication.
The terms of the Notes set forth in Exhibit X-0, Xxxxxxx X-0, Exhibit X-0,
Xxxxxxx X-0 and Exhibit A-5 are part of the terms of this Indenture and are
incorporated herein by reference.
SECTION 2.2. Execution, Authentication and Delivery. (a)
The Notes shall be executed on behalf of the Issuer by any of its Authorized
Officers. The signature of any such Authorized Officer on the Notes may be
manual or facsimile.
(b) Notes bearing the manual or facsimile signature of
individuals who were at any time Authorized Officers of the Issuer shall bind
the Issuer, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Notes or did
not hold such offices at the date of such Notes.
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(c) The Indenture Trustee shall, upon Issuer Order,
authenticate and deliver Class A-1 Notes for original issue in an aggregate
principal amount of $750,000,000 Class A-2 Notes for original issue in an
aggregate principal amount of $1,000,000,000 Class A-3 Notes for original issue
in an aggregate principal amount of $785,000,000, Class A-4 Notes for original
issue in an aggregate principal amount of $300,000,000 and Class B Notes for
original issue in an aggregate principal amount of $105,000,000. The aggregate
principal amount of Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class
A-4 Notes and Class B Notes outstanding at any time may not exceed those
respective amounts except as provided in Section 2.6.
(d) The Notes shall be issuable as registered Notes in
minimum denominations of $1,000 and in integral multiples of $1,000 in excess
thereof.
(e) No Note shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose, unless there appears on
such Note a certificate of authentication substantially in the form provided
for herein executed by the Indenture Trustee by the manual signature of one of
its authorized signatories, and such certificate upon any Note shall be
conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.
SECTION 2.3. Temporary Notes. (a) Pending the preparation
of definitive Notes, the Issuer may execute, and upon receipt of an Issuer
Order the Indenture Trustee shall authenticate and deliver, temporary Notes
that are printed, lithographed, typewritten, mimeographed or otherwise
produced, substantially of the tenor of the definitive Notes in lieu of which
they are issued and with such variations not inconsistent with the terms of
this Indenture as the officers executing the temporary Notes may determine, as
evidenced by their execution of such temporary Notes.
If temporary Notes are issued, the Issuer shall cause
definitive Notes to be prepared without unreasonable delay. After the
preparation of definitive Notes, the temporary Notes shall be exchangeable for
definitive Notes upon surrender of the temporary Notes at the office or agency
of the Issuer to be maintained as provided in
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Section 3.2, without charge to the Noteholder. Upon surrender for cancellation
of any one or more temporary Notes, the Issuer shall execute, and the Indenture
Trustee shall authenticate and deliver in exchange therefor, a like principal
amount of definitive Notes of authorized denominations. Until so exchanged,
the temporary Notes shall in all respects be entitled to the same benefits
under this Indenture as definitive Notes.
SECTION 2.4. Tax Treatment. The Issuer has entered into this
Indenture, and the Notes shall be issued, with the intention that, for federal,
State and local income and franchise tax purposes, the Notes shall qualify as
indebtedness of the Issuer secured by the Indenture Trust Estate. The Issuer,
by entering into this Indenture, and each Noteholder, by its acceptance of a
Note (and each Note Owner by its acceptance of an interest in the applicable
Book-Entry Note), agree to treat the Notes for federal, State and local income
and franchise tax purposes as indebtedness of the Issuer.
SECTION 2.5. Registration; Registration of Transfer and
Exchange. (a) The Issuer shall cause to be kept a register (the "Note
Register") in which, subject to such reasonable regulations as it may
prescribe, the Issuer shall provide for the registration of Notes and the
registration of transfers of Notes. The Indenture Trustee initially shall be
the "Note Registrar" for the purpose of registering Notes and transfers of
Notes as herein provided. Upon any resignation of any Note Registrar, the
Issuer shall promptly appoint a successor or, if it elects not to make such an
appointment, assume the duties of Note Registrar. If a Person other than the
Indenture Trustee is appointed by the Issuer as Note Registrar, (i) the Issuer
shall give the Indenture Trustee prompt written notice of the appointment of
such Note Registrar and of the location, and any change in the location, of the
Note Register, (ii) the Indenture Trustee shall have the right to inspect the
Note Register at all reasonable times and to obtain copies thereof, and (iii)
the Indenture Trustee shall have the right to rely upon a certificate executed
on behalf of the Note Registrar by an Executive Officer thereof as to the names
and addresses of the Noteholders and the principal amounts and number of such
Notes.
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(b) No transfer of any Class B Note shall be permitted,
recognized or recorded unless the prospective transferee of such Class B Note
shall provide a letter in the form of Exhibit C to the Issuer, the Indenture
Trustee and the Note Registrar, in which such prospective transferee shall
represent the following:
(i) It is, and each account (if any) for which it is
purchasing the Class B Notes is, a Person who is (A) a citizen or
resident of the United States, (B) a corporation or partnership
organized in or under the laws of the United States or any political
subdivision thereof, (C) an estate the income of which is includible
in gross income for United States tax purposes, regardless of its
source, (D) a trust if a U.S. court is able to exercise primary
supervision over the administration of such trust and one or more
Persons meeting the conditions of clause (A), (B), (C) or (E) of this
paragraph (i) has the authority to control all substantial decisions
of the trust or (E) a Person not described in clauses (A) through (D)
above whose ownership of the Class B Notes is effectively connected
with such Person's conduct of a trade or business within the United
States (within the meaning of the Code) and who provides the Indenture
Trustee and the Issuer with an IRS Form 4224 (and such other
certifications, representations, or opinions of counsel as may be
requested by the Indenture Trustee or the Issuer).
(ii) It understands that any purported transfer of any Class
B Note (or any interest therein) to any Person who does not meet the
conditions of paragraph (i) above shall be null and void, and the
purported transferee in any such purported transfer shall not be
recognized by the Trust or any other Person as a Noteholder of a Class
B Note for any purpose.
(iii) It agrees that if it determines to transfer any of the
Class B Notes it will cause its proposed transferee to provide to the
Issuer, the Indenture Trustee and the Note Registrar a letter
substantially in the form of Exhibit C hereof or such other written
statement as the Indenture Trustee shall prescribe.
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(c) Upon surrender for registration of transfer of any Note
at the office or agency of the Issuer to be maintained as provided in Section
3.2, if the requirements of Section 8-401(1) of the UCC are met the Issuer
shall execute, and the Indenture Trustee shall authenticate and the Noteholder
shall obtain from the Indenture Trustee, in the name of the designated
transferee or transferees, one or more new Notes of the same Class in any
authorized denomination, of a like aggregate principal amount.
(d) At the option of the Noteholder, Notes may be exchanged
for other Notes of the same Class in any authorized denominations, of a like
aggregate principal amount, upon surrender of the Notes to be exchanged at such
office or agency. Whenever any Notes are so surrendered for exchange, if the
requirements of Section 8-401(1) of the UCC are met, the Issuer shall execute,
the Indenture Trustee shall authenticate, and the Noteholder shall obtain from
the Indenture Trustee, the Notes which the Noteholder making such exchange is
entitled to receive.
(e) All Notes issued upon any registration of transfer or
exchange of Notes shall be the valid obligations of the Issuer, evidencing the
same debt, and entitled to the same benefits under this Indenture as the Notes
surrendered upon such registration of transfer or exchange.
(f) Every Note presented or surrendered for registration of
transfer or exchange shall be (i) duly endorsed by, or be accompanied by a
written instrument of transfer in form satisfactory to the Indenture Trustee
duly executed by, the Noteholder thereof or such Noteholder's attorney duly
authorized in writing, with such signature guaranteed by an "eligible guarantor
institution" meeting the requirements of the Note Registrar and (ii)
accompanied by such other documents or evidence as the Indenture Trustee may
require.
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(g) No service charge shall be made to a Noteholder for any
registration of transfer or exchange of Notes, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or exchange of
Notes, other than exchanges pursuant to Section 2.3 or 9.6 not involving any
transfer.
(h) The preceding provisions of this Section 2.5
notwithstanding, the Issuer shall not be required to make and the Note
Registrar need not register transfers or exchanges of Notes selected for
redemption or of any Note for a period of fifteen (15) days preceding the
Distribution Date for any payment with respect to such Note.
SECTION 2.6. Mutilated, Destroyed, Lost or Stolen Notes. (a)
If (i) any mutilated Note is surrendered to the Indenture Trustee, or the
Indenture Trustee receives evidence to its satisfaction of the destruction,
loss or theft of any Note, and (ii) there is delivered to the Indenture Trustee
such security or indemnity as may be required by it to hold the Issuer and the
Indenture Trustee harmless, then, in the absence of notice to the Issuer, the
Note Registrar or the Indenture Trustee that such Note has been acquired by a
protected purchaser, as defined in Section 8-303 of the UCC, and provided that
the requirements of Section 8-405 of the UCC are met, the Issuer shall execute,
and upon Issuer Request the Indenture Trustee shall authenticate and deliver,
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Note, a replacement Note of the same Class; provided, however, that if any such
destroyed, lost or stolen Note, but not a mutilated Note, shall have become or
within seven (7) days shall be due and payable, or shall have been called for
redemption, instead of issuing a replacement Note, the Issuer may pay such
destroyed, lost or stolen Note when so due or payable or upon the Redemption
Date without surrender thereof. If, after the delivery of such replacement
Note or payment of a destroyed, lost or stolen Note pursuant to the proviso to
the preceding sentence, a protected purchaser of the original Note in lieu of
which such replacement Note was issued presents for payment such original Note,
the Issuer and the Indenture Trustee shall be entitled to recover such
replacement Note (or such payment) from the
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Person to whom it was delivered or any Person taking such replacement Note from
such Person to whom such replacement Note was delivered or any assignee of such
Person, except a protected purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any loss, damage, cost
or expense incurred by the Issuer or the Indenture Trustee in connection
therewith.
(b) Upon the issuance of any replacement Note under this
Section 2.6, the Issuer may require the payment by the Noteholder of such Note
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other reasonable expenses (including the
fees and expenses of the Indenture Trustee) connected therewith.
(c) Every replacement Note issued pursuant to this Section
2.6 in replacement of any mutilated, destroyed, lost or stolen Note shall
constitute an original additional contractual obligation of the Issuer, whether
or not the mutilated, destroyed, lost or stolen Note shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Notes duly issued
hereunder.
(d) The provisions of this Section 2.6 are exclusive and
shall preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Notes.
SECTION 2.7. Persons Deemed Owners. Prior to due presentment
for registration of transfer of any Note, the Issuer, the Indenture Trustee and
any agent of the Issuer or the Indenture Trustee may treat the Person in whose
name any Note is registered (as of the day of determination) as the owner of
such Note for the purpose of receiving payments of principal of and interest,
if any, on such Note and for all other purposes whatsoever, whether or not such
Note be overdue, and none of the Issuer, the Indenture Trustee or any agent of
the Issuer or the Indenture Trustee shall be affected by notice to the
contrary.
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SECTION 2.8. Payment of Principal and Interest; Defaulted
Interest. (a) The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes,
the Class A-4 Notes and the Class B Notes shall accrue interest at the Class
A-1 Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate and the
Class B Rate, respectively, as set forth in Exhibit X-0, Xxxxxxx X-0, Exhibit
X-0, Xxxxxxx X-0 and Exhibit A-5, respectively, and such interest shall be due
and payable on each Distribution Date as specified therein, subject to Section
3.1. Any installment of interest or principal, if any, payable on any Note
that is punctually paid or duly provided for by the Issuer on the applicable
Distribution Date shall be paid to the Person in whose name such Note (or one
or more Predecessor Notes) is registered on the Record Date either by wire
transfer in immediately available funds, to the account of such Noteholder at a
bank or other entity having appropriate facilities therefor, if such Noteholder
shall have provided to the Note Registrar appropriate written instructions at
least five (5) Business Days prior to such Distribution Date and such
Noteholder's Notes in the aggregate evidence a denomination of not less than
$1,000,000, or, if not, by check mailed first-class postage prepaid to such
Person's address as it appears on the Note Register on such Record Date;
provided that, unless Definitive Notes have been issued to Note Owners pursuant
to Section 2.13, with respect to Notes registered on the Record Date in the
name of the nominee of the Clearing Agency (initially, such nominee to be Cede
& Co.), payment shall be made by wire transfer in immediately available funds
to the account designated by such nominee, and except for the final installment
of principal payable with respect to such Note on a Distribution Date,
Redemption Date or the applicable Final Scheduled Distribution Date, which
shall be payable as provided below. The funds represented by any such checks
returned undelivered shall be held in accordance with Section 3.3.
(b) The principal of each Note shall be payable in
installments on each Distribution Date as provided in the forms of Notes set
forth in Exhibit X-0, Xxxxxxx X-0, Exhibit X-0, Xxxxxxx X-0 and Exhibit A-5
hereto. Notwithstanding the foregoing, the entire unpaid principal amount of
each Class of Notes shall be due and payable, if not previously paid, on the
date on which an Event of Default shall have occurred and be continuing,
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if the Indenture Trustee or the Noteholders of Notes evidencing not less than a
majority of the principal amount of the Notes Outstanding have declared the
Notes to be immediately due and payable in the manner provided in Section 5.2.
All principal payments on each Class of Notes shall be made pro rata to the
Noteholders of such Class entitled thereto. The Indenture Trustee shall notify
the Person in whose name a Note is registered at the close of business on the
Record Date preceding the Distribution Date on which the Issuer expects that
the final installment of principal of and interest on such Note shall be paid.
Such notice shall be mailed or transmitted by facsimile prior to such final
Distribution Date and shall specify that such final installment shall be
payable only upon presentation and surrender of such Note and shall specify the
place where such Note may be presented and surrendered for payment of such
installment. Notices in connection with redemption of Notes shall be mailed to
Noteholders as provided in Section 10.2.
(c) If the Issuer defaults in a payment of interest on the
Notes, the Issuer shall pay defaulted interest (plus interest on such defaulted
interest to the extent lawful) at the applicable Note Interest Rate on the
Distribution Date following such default. The Issuer shall pay such defaulted
interest to the Persons who are Noteholders on the Record Date for such
following Distribution Date.
SECTION 2.9. Cancellation. All Notes surrendered for
payment, registration of transfer, exchange or redemption shall, if surrendered
to any Person other than the Indenture Trustee, be delivered to the Indenture
Trustee and shall be promptly cancelled by the Indenture Trustee. The Issuer
may at any time deliver to the Indenture Trustee for cancellation any Notes
previously authenticated and delivered hereunder which the Issuer may have
acquired in any manner whatsoever, and all Notes so delivered shall be promptly
cancelled by the Indenture Trustee. No Notes shall be authenticated in lieu of
or in exchange for any Notes cancelled as provided in this Section 2.9, except
as expressly permitted by this Indenture. All cancelled Notes may be held or
disposed of by the Indenture Trustee in accordance with its standard retention
or disposal policy as in effect at the time unless the Issuer shall direct by
an Issuer Order that
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they be destroyed or returned to it and so long as such Issuer Order is timely
and the Notes have not been previously disposed of by the Indenture Trustee.
SECTION 2.10. Release of Collateral. Subject to Section 11.1
and the terms of the Basic Documents, the Indenture Trustee shall release
property from the lien of this Indenture only upon receipt of an Issuer Request
accompanied by an Officer's Certificate, an Opinion of Counsel and Independent
Certificates in accordance with TIA Sections 314(c) and 314(d)(1) or an Opinion
of Counsel in lieu of such Independent Certificates to the effect that the TIA
does not require any such Independent Certificates. If the Commission shall
issue an exemptive order under TIA Section 304(d) modifying the Owner Trustee's
obligations under TIA Sections 314(c) and 314(d)(1), subject to Section 11.1
and the terms of the Basic Documents, the Indenture Trustee shall release
property from the lien of this Indenture in accordance with the conditions and
procedures set forth in such exemptive order.
SECTION 2.11. Book-Entry Notes. The Class A Notes, upon
original issuance, shall be issued in the form of typewritten Notes
representing the Book-Entry Notes, to be delivered to The Depository Trust
Company, the initial Clearing Agency, by, or on behalf of, the Issuer. The
Book-Entry Notes shall be registered initially on the Note Register in the name
of Cede & Co., the nominee of the initial Clearing Agency, and no Note Owner
thereof shall receive a Definitive Note (as defined below) representing such
Note Owner's interest in such Note, except as provided in Section 2.13. Unless
and until definitive, fully registered Notes (the "Definitive Notes") have been
issued to such Note Owners pursuant to Section 2.13:
(i) the provisions of this Section 2.11 shall be in
full force and effect;
(ii) the Note Registrar and the Indenture Trustee
shall be entitled to deal with the Clearing Agency for all
purposes of this Indenture (including the payment of principal
of and interest on the Book- Entry Notes and the giving of
instructions or directions hereunder)
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as the sole Noteholder, and shall have no obligation to the
Note Owners;
(iii) to the extent that the provisions of this
Section 2.11 conflict with any other provisions of this
Indenture, the provisions of this Section 2.11 shall control;
(iv) the rights of Note Owners shall be exercised
only through the Clearing Agency and shall be limited to those
established by law and agreements between such Note Owners and
the Clearing Agency and/or the Clearing Agency Participants
pursuant to the Note Depository Agreement. Unless and until
Definitive Notes are issued to Note Owners pursuant to Section
2.13, the initial Clearing Agency shall make book-entry
transfers among the Clearing Agency Participants and receive
and transmit payments of principal of and interest on the
Book-Entry Notes to such Clearing Agency Participants; and
(v) whenever this Indenture requires or permits
actions to be taken based upon instructions or directions of
Noteholders of Notes evidencing a specified percentage of the
principal amount of the Notes Outstanding, the Clearing Agency
shall be deemed to represent such percentage only to the
extent that it has received instructions to such effect from
Note Owners and/or Clearing Agency Participants owning or
representing, respectively, such required percentage of the
beneficial interest in the Notes Outstanding and has delivered
such instructions to the Indenture Trustee.
SECTION 2.12. Notices to Clearing Agency. Whenever a notice
or other communication to the Noteholders of Book-Entry Notes is required under
this Indenture, unless and until Definitive Notes shall have been issued to the
Note Owners pursuant to Section 2.13, the Indenture Trustee shall give all such
notices and communications specified herein to be given to Noteholders of
Book-Entry Notes to the Clearing Agency, and shall have no obligation to such
Note Owners.
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SECTION 2.13. Definitive Notes. The Class B Notes shall be
issued in the form of one or more typewritten Notes representing Definitive
Notes, to be delivered to the purchasers thereof or their respective nominees,
by, or on behalf of, the Issuer. If (i) the Administrator advises the
Indenture Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities with respect to the Book-Entry
Notes and the Administrator is unable to locate a qualified successor, (ii) the
Administrator, at its option, advises the Indenture Trustee in writing that it
elects to terminate the book-entry system through the Clearing Agency or (iii)
after the occurrence of an Event of Default or an Event of Servicing
Termination, Note Owners of Book-Entry Notes evidencing beneficial interests
aggregating not less than a majority of the principal amount of the Book-Entry
Notes Outstanding advise the Indenture Trustee and the Clearing Agency in
writing that the continuation of a book-entry system through the Clearing
Agency is no longer in the best interests of the Note Owners, then the Clearing
Agency shall notify all Note Owners and the Indenture Trustee of the occurrence
of such event and of the availability of Definitive Notes to Note Owners
requesting the same. Upon surrender to the Indenture Trustee of the
typewritten Notes representing the Book-Entry Notes by the Clearing Agency,
accompanied by registration instructions, the Issuer shall execute and the
Indenture Trustee shall authenticate the Definitive Notes in accordance with
the instructions of the Clearing Agency. None of the Issuer, the Note
Registrar or the Indenture Trustee shall be liable for any delay in delivery of
such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Notes to Note
Owners, the Indenture Trustee shall recognize the holders of such Definitive
Notes as Noteholders.
SECTION 2.14. Authenticating Agents. (a) The Indenture
Trustee may appoint one or more Persons (each, an "Authenticating Agent") with
power to act on its behalf and subject to its direction in the authentication
of Notes in connection with issuance, transfers and exchanges under Sections
2.2, 2.3, 2.5, 2.6 and 9.6, as fully to all intents and purposes as though each
such Authenticating Agent had been expressly authorized by those Sections to
authenticate such Notes. For all
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purposes of this Indenture, the authentication of Notes by an Authenticating
Agent pursuant to this Section 2.14 shall be deemed to be the authentication of
Notes "by the Indenture Trustee."
(b) Any corporation into which any Authenticating Agent may
be merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, consolidation or conversion to which any
Authenticating Agent shall be a party, or any corporation succeeding to all or
substantially all of the corporate trust business of any Authenticating Agent,
shall be the successor of such Authenticating Agent hereunder, without the
execution or filing of any further act on the part of the parties hereto or
such Authenticating Agent or such successor corporation.
(c) Any Authenticating Agent may at any time resign by giving
written notice of resignation to the Indenture Trustee and the Owner Trustee.
The Indenture Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and the Owner Trustee. Upon receiving such notice of
resignation or upon such a termination, the Indenture Trustee may appoint a
successor Authenticating Agent and shall give written notice of any such
appointment to the Owner Trustee.
(d) The Administrator agrees to pay to each Authenticating
Agent from time to time reasonable compensation for its services. The
provisions of Sections 2.9 and 6.4 shall be applicable to any Authenticating
Agent.
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ARTICLE III
COVENANTS
SECTION 3.1. Payment of Principal and Interest. The Issuer
shall duly and punctually pay the principal of and interest, if any, on the
Notes in accordance with the terms of the Notes and this Indenture. Without
limiting the foregoing and subject to Section 8.2, on each Distribution Date
the Issuer shall cause to be paid all amounts on deposit in the Collection
Account and the Principal Distribution Account with respect to the Collection
Period preceding such Distribution Date and deposited therein pursuant to the
Sale and Servicing Agreement. Amounts properly withheld under the Code by any
Person from a payment to any Noteholder of interest and/or principal shall be
considered as having been paid by the Issuer to such Noteholder for all
purposes of this Indenture.
SECTION 3.2. Maintenance of Office or Agency. The Issuer
shall maintain in the Borough of Manhattan, The City of New York, an office or
agency where Notes may be surrendered for registration of transfer or exchange,
and where notices and demands to or upon the Issuer in respect of the Notes and
this Indenture may be served. The Issuer hereby initially appoints the
Indenture Trustee to serve as its agent for the foregoing purposes. The Issuer
shall give prompt written notice to the Indenture Trustee of the location, and
of any change in the location, of any such office or agency. If, at any time,
the Issuer shall fail to maintain any such office or agency or shall fail to
furnish the Indenture Trustee with the address thereof, such surrenders,
notices and demands may be made or served at the Corporate Trust Office, and
the Issuer hereby appoints the Indenture Trustee as its agent to receive all
such surrenders, notices and demands.
SECTION 3.3. Money for Payments To Be Held in Trust. (a) As
provided in Sections 8.2 and 5.4(b), all payments of amounts due and payable
with respect to any Notes that are to be made from amounts withdrawn from the
Trust Accounts and the Payahead Account shall be made on behalf of the Issuer
by the Indenture Trustee or by another Note Paying Agent, and no amounts so
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withdrawn from the Trust Accounts and the Payahead Account for payments of
Notes shall be paid over to the Issuer, except as provided in this Section 3.3.
(b) On or before each Distribution Date and Redemption Date,
the Issuer shall deposit or cause to be deposited in the Collection Account an
aggregate sum sufficient to pay the amounts then becoming due under the Notes,
such sum to be held in trust for the benefit of the Persons entitled thereto,
and (unless the Note Paying Agent is the Indenture Trustee) shall promptly
notify the Indenture Trustee of its action or failure so to act.
(c) The Issuer shall cause each Note Paying Agent other than
the Indenture Trustee to execute and deliver to the Indenture Trustee an
instrument in which such Note Paying Agent shall agree with the Indenture
Trustee (and if the Indenture Trustee acts as Note Paying Agent, it hereby so
agrees), subject to the provisions of this Section 3.3, that such Note Paying
Agent shall:
(i) hold all sums held by it for the payment of
amounts due with respect to the Notes in trust for the benefit
of the Persons entitled thereto until such sums shall be paid
to such Persons or otherwise disposed of as herein provided
and pay such sums to such Persons as herein provided;
(ii) give the Indenture Trustee notice of any
default by the Issuer (or any other obligor upon the Notes) of
which it has actual knowledge in the making of any payment
required to be made with respect to the Notes;
(iii) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee,
forthwith pay to the Indenture Trustee all sums so held in
trust by such Note Paying Agent;
(iv) immediately resign as a Note Paying Agent and
forthwith pay to the Indenture Trustee all sums held by it in
trust for the payment of Notes if at any time it ceases to
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meet the standards required to be met by a Note Paying Agent
at the time of its appointment; and
(v) comply with all requirements of the Code and any
State or local tax law with respect to the withholding from
any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith.
(d) The Issuer may at any time, for the purpose of obtaining
the satisfaction and discharge of this Indenture or for any other purpose, by
Issuer Order direct any Note Paying Agent to pay to the Indenture Trustee all
sums held in trust by such Note Paying Agent, such sums to be held by the
Indenture Trustee upon the same trusts as those upon which the sums were held
by such Note Paying Agent; and upon such payment by any Note Paying Agent to
the Indenture Trustee, such Note Paying Agent shall be released from all
further liability with respect to such money.
(e) Subject to applicable laws with respect to escheat of
funds, any money held by the Indenture Trustee or any Note Paying Agent in
trust for the payment of any amount due with respect to any Note and remaining
unclaimed for two (2) years after such amount has become due and payable shall
be discharged from such trust and be paid to the Issuer on Issuer Request; and
the Noteholder of such Note shall thereafter, as an unsecured general creditor,
look only to the Issuer for payment thereof (but only to the extent of the
amounts so paid to the Issuer), and all liability of the Indenture Trustee or
such Note Paying Agent with respect to such trust money shall thereupon cease;
provided, however, that the Indenture Trustee or such Note Paying Agent, before
being required to make any such repayment, shall at the expense and direction
of the Issuer cause to be published once, in a newspaper published in the
English language, customarily published on each Business Day and of general
circulation in The City of New York, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than thirty
(30) days from the date of such publication, any unclaimed balance of such
money then remaining shall be
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repaid to the Issuer. The Indenture Trustee shall also adopt and employ, at
the expense and direction of the Issuer, any other reasonable means of
notification of such repayment (including, but not limited to, mailing notice
of such repayment to Noteholders whose Notes have been called but have not been
surrendered for redemption or whose right to or interest in monies due and
payable but not claimed is determinable from the records of the Indenture
Trustee or of any Note Paying Agent, at the last address of record for each
such Noteholder).
SECTION 3.4. Existence. The Issuer shall keep in full effect
its existence, rights and franchises as a business trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other State or of the United States of
America, in which case the Issuer shall keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and shall
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 Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Indenture Trust Estate.
SECTION 3.5. Protection of Indenture Trust Estate. The
Issuer shall from time to time execute and deliver all such supplements and
amendments hereto and all such financing statements, continuation statements,
instruments of further assurance and other instruments, and shall take such
other action necessary or advisable to:
(i) maintain or preserve the lien and security
interest (and the priority thereof) of this Indenture or carry
out more effectively the purposes hereof;
(ii) perfect, publish notice of or protect the
validity of any Grant made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
(iv) preserve and defend title to the Indenture
Trust Estate and the rights of the
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Indenture Trustee and the Noteholders in such Indenture Trust
Estate against the claims of all Persons.
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument required to be executed pursuant to this Section 3.5;
provided, however, that the Indenture Trustee shall be under no obligation to
file any such financing statement, continuation statement or other instrument
required to be executed pursuant to this Section 3.5.
SECTION 3.6. Opinions as to Indenture Trust Estate. (a) On
the Closing Date, the Issuer shall furnish to the Indenture Trustee an Opinion
of Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording and filing of this Indenture, any
indentures supplemental hereto, and any other requisite documents, and with
respect to the execution and filing of any financing statements and
continuation statements, as are necessary to perfect and make effective the
lien and security interest of this Indenture and reciting the details of such
action, or stating that, in the opinion of such counsel, no such action is
necessary to make such lien and security interest effective.
(b) On or before April 30 in each calendar year, beginning in
1999, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel
either stating that, in the opinion of such counsel, such action has been taken
with respect to the recording, filing, re-recording and refiling of this
Indenture, any indentures supplemental hereto and any other requisite documents
and with respect to the execution and filing of any financing statements and
continuation statements and any other action that may be required by law as is
necessary to maintain the lien and security interest created by this Indenture
and reciting the details of such action or stating that in the opinion of such
counsel no such action is necessary to maintain such lien and security
interest. Such Opinion of Counsel shall also describe the recording, filing,
re-recording and refiling of this Indenture, any indentures supplemental hereto
and any other requisite documents and the execution and filing of any financing
statements and continuation statements
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that shall, in the opinion of such counsel, be required to maintain the lien
and security interest of this Indenture until April 30 in the following
calendar year.
SECTION 3.7. Performance of Obligations; Servicing of
Receivables. (a) The Issuer shall not take any action and shall use its best
efforts not to permit any action to be taken by others that would release any
Person from any of such Person's material covenants or obligations under any
instrument or agreement included in the Indenture Trust Estate or that would
result in the amendment, hypothecation, subordination, termination or discharge
of, or impair the validity or effectiveness of, any such instrument or
agreement, except as expressly provided in this Indenture and the other Basic
Documents.
(b) The Issuer may contract with other Persons to assist it
in performing its duties under this Indenture, and any performance of such
duties by a Person identified to the Indenture Trustee in an Officer's
Certificate of the Issuer shall be deemed to be action taken by the Issuer.
Initially, the Issuer has contracted with the Servicer and the Administrator to
assist the Issuer in performing its duties under this Indenture.
(c) The Issuer shall punctually perform and observe all of
its obligations and agreements contained in this Indenture, the other Basic
Documents and in the instruments and agreements included in the Indenture Trust
Estate, including, but not limited to, filing or causing to be filed all
financing statements and continuation statements required to be filed under the
UCC by the terms of this Indenture and the Sale and Servicing Agreement in
accordance with and within the time periods provided for herein and therein.
Except as otherwise expressly provided therein, the Issuer shall not waive,
amend, modify, supplement or terminate any Basic Document or any provision
thereof without the consent of the Indenture Trustee or the Noteholders of
Notes evidencing not less than a majority of the principal amount of the Notes
Outstanding.
(d) If the Issuer shall have knowledge of the occurrence of
an Event of Servicing Termination under the Sale and Servicing Agreement, the
Issuer shall
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promptly notify the Indenture Trustee and the Rating Agencies thereof and shall
specify in such notice the action, if any, the Issuer is taking in respect of
such default. If an Event of Servicing Termination shall arise from the
failure of the Servicer to perform any of its duties or obligations under the
Sale and Servicing Agreement with respect to the Receivables, the Issuer shall
take all reasonable steps available to it to remedy such failure.
(e) As promptly as possible after the giving of notice of
termination to the Servicer of the Servicer's rights and powers pursuant to
Section 8.1 of the Sale and Servicing Agreement or the Servicer's resignation
in accordance with the terms of the Sale and Servicing Agreement, the Issuer
shall appoint a successor servicer (the "Successor Servicer") meeting the
requirements of the Sale and Servicing Agreement, and such Successor Servicer
shall accept its appointment by a written assumption in a form acceptable to
the Indenture Trustee. In the event that a Successor Servicer has not been
appointed at the time when the Servicer ceases to act as Servicer, the
Indenture Trustee without further action shall automatically be appointed the
Successor Servicer. If the Indenture Trustee shall be legally unable to act as
Successor Servicer, it may appoint, or petition a court of competent
jurisdiction to appoint, a Successor Servicer. The Indenture Trustee may
resign as the Servicer by giving written notice of such resignation to the
Issuer and in such event shall be released from such duties and obligations,
such release not to be effective until the date a new servicer enters into a
servicing agreement with the Issuer as provided below. Upon delivery of any
such notice to the Issuer, the Issuer shall obtain a new servicer as the
Successor Servicer under the Sale and Servicing Agreement. Any Successor
Servicer (other than the Indenture Trustee) shall (i) be an established
institution having a net worth of not less than $100,000,000 and whose regular
business shall include the servicing of automotive receivables and (ii) enter
into a servicing agreement with the Issuer having substantially the same
provisions as the provisions of the Sale and Servicing Agreement applicable to
the Servicer. If, within thirty (30) days after the delivery of the notice
referred to above, the Issuer shall not have obtained such a new servicer, the
Indenture Trustee may appoint, or may
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petition a court of competent jurisdiction to appoint, a Successor Servicer.
In connection with any such appointment, the Indenture Trustee may make such
arrangements for the compensation of such successor as it and such successor
shall agree, subject to the limitations set forth below and in the Sale and
Servicing Agreement, and, in accordance with Section 8.2 of the Sale and
Servicing Agreement, the Issuer shall enter into an agreement with such
successor for the servicing of the Receivables (such agreement to be in form
and substance satisfactory to the Indenture Trustee). If the Indenture Trustee
shall succeed to the Servicer's duties as servicer of the Receivables as
provided herein, it shall do so in its individual capacity and not in its
capacity as Indenture Trustee and, accordingly, the provisions of Article VI
hereof shall be inapplicable to the Indenture Trustee in its duties as the
successor to the Servicer and the servicing of the Receivables. In case the
Indenture Trustee shall become successor to the Servicer under the Sale and
Servicing Agreement, the Indenture Trustee shall be entitled to appoint as
Servicer any one of its Affiliates; provided that the Indenture Trustee, in its
capacity as the Servicer, shall be fully liable for the actions and omissions
of such Affiliate in such capacity as Successor Servicer.
(f) Upon any termination of the Servicer's rights and powers
pursuant to the Sale and Servicing Agreement, the Issuer shall promptly notify
the Indenture Trustee. As soon as a Successor Servicer is appointed by the
Issuer, the Issuer shall notify the Indenture Trustee of such appointment,
specifying in such notice the name and address of such Successor Servicer.
(g) Without derogating from the absolute nature of the
assignment granted to the Indenture Trustee under this Indenture or the rights
of the Indenture Trustee hereunder, the Issuer hereby agrees that it shall not,
without the prior written consent of the Indenture Trustee or the Noteholders
of Notes evidencing not less than a majority in principal amount of the Notes
Outstanding, amend, modify, waive, supplement, terminate or surrender, or agree
to any amendment, modification, supplement, termination, waiver or surrender
of, the terms of any Collateral (except to the extent otherwise provided in the
Sale and Servicing Agreement or the other Basic Documents).
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SECTION 3.8. Negative Covenants. So long as any Notes are
Outstanding, the Issuer shall not:
(i) except as expressly permitted by this Indenture,
the Trust Agreement, the Purchase Agreement or the Sale and
Servicing Agreement, sell, transfer, exchange or otherwise
dispose of any of the properties or assets of the Issuer,
including those included in the Indenture Trust Estate, unless
directed to do so by the Indenture Trustee;
(ii) claim any credit on, or make any deduction from
the principal or interest payable in respect of, the Notes
(other than amounts properly withheld from such payments under
the Code) or assert any claim against any present or former
Noteholder by reason of the payment of the taxes levied or
assessed upon the Trust or the Indenture Trust Estate;
(iii) dissolve or liquidate in whole or in part; or
(iv) (A) permit the validity or effectiveness of
this Indenture to be impaired, or permit the lien of this
Indenture to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be released
from any covenants or obligations with respect to the Notes
under this Indenture except as may be expressly permitted
hereby, (B) permit any lien, charge, excise, claim, security
interest, mortgage or other encumbrance (other than the lien
of this Indenture) to be created on or extend to or otherwise
arise upon or burden the assets of the Issuer, including those
included in the Indenture Trust Estate, or any part thereof or
any interest therein or the proceeds thereof (other than tax
liens, mechanics' liens and other liens that arise by
operation of law, in each case on any of the Financed Vehicles
and arising solely as a result of an action or omission of the
related Obligor) or (C) permit the lien of this Indenture not
to constitute a valid first priority (other than with respect
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to any such tax, mechanics' or other lien) security interest
in the Indenture Trust Estate.
SECTION 3.9. Annual Statement as to Compliance. The Issuer
shall deliver to the Indenture Trustee, within 120 days after the end of each
calendar year (commencing with the year 1999), an Officer's Certificate
stating, as to the Authorized Officer signing such Officer's Certificate, that:
(i) a review of the activities of the Issuer during
such year and of its performance under this Indenture has been
made under such Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's
knowledge, based on such review, the Issuer has complied with
all conditions and covenants under this Indenture throughout
such year, or, if there has been a default in its compliance
with any such condition or covenant, specifying each such
default known to such Authorized Officer and the nature and
status thereof.
SECTION 3.10. Issuer May Consolidate, etc., Only on Certain
Terms. (a) The Issuer shall not consolidate or merge with or into any other
Person, unless:
(i) the Person (if other than the Issuer) formed by
or surviving such consolidation or merger shall be a Person
organized and existing under the laws of the United States of
America or any State and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the
Indenture Trustee, in form satisfactory to the Indenture
Trustee, the due and punctual payment of the principal of and
interest on all Notes and the performance or observance of
every agreement and covenant of this Indenture on the part of
the Issuer to be performed or observed, all as provided
herein;
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(ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have
occurred and be continuing;
(iii) the Rating Agency Condition shall have been
satisfied with respect to such transaction;
(iv) the Issuer shall have received an Opinion of
Counsel (and shall have delivered copies thereof to the
Indenture Trustee) to the effect that such transaction will
not have any material adverse tax consequence to the Issuer,
any Noteholder or any Certificateholder;
(v) any action that is necessary to maintain the
lien and security interest created by this Indenture shall
have been taken; and
(vi) the Issuer shall have delivered to the
Indenture Trustee an Officer's Certificate and an Opinion of
Counsel each stating that such consolidation or merger and
such supplemental indenture comply with this Article III and
that all conditions precedent herein provided for relating to
such transaction have been complied with (including any filing
required by the Exchange Act).
(b) Other than as specifically contemplated by the Basic
Documents, the Issuer shall not convey or transfer any of its properties or
assets, including those included in the Indenture Trust Estate, to any Person,
unless:
(i) the Person that acquires by conveyance or
transfer the properties and assets of the Issuer the
conveyance or transfer of which is hereby restricted shall (A)
be a United States citizen or a Person organized and existing
under the laws of the United States of America or any State,
(B) expressly assumes, by an indenture supplemental hereto,
executed and delivered to the Indenture Trustee, in form
satisfactory to the Indenture Trustee,
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the due and punctual payment of the principal of and interest
on all Notes and the performance or observance of every
agreement and covenant of this Indenture on the part of the
Issuer to be performed or observed, all as provided herein,
(C) expressly agrees by means of such supplemental indenture
that all right, title and interest so conveyed or transferred
shall be subject and subordinate to the rights of Noteholders,
(D) unless otherwise provided in such supplemental indenture,
expressly agrees to indemnify, defend and hold harmless the
Issuer against and from any loss, liability or expense arising
under or related to this Indenture and the Notes, and (E)
expressly agrees by means of such supplemental indenture that
such Person (or if a group of Persons, then one specified
Person) shall make all filings with the Commission (and any
other appropriate Person) required by the Exchange Act in
connection with the Notes;
(ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have
occurred and be continuing;
(iii) the Rating Agency Condition shall have been
satisfied with respect to such transaction;
(iv) the Issuer shall have received an Opinion of
Counsel (and shall have delivered copies thereof to the
Indenture Trustee) to the effect that such transaction will
not have any material adverse tax consequence to the Issuer,
any Noteholder or any Certificateholder;
(v) any action that is necessary to maintain the
lien and security interest created by this Indenture shall
have been taken; and
(vi) the Issuer shall have delivered to the
Indenture Trustee an Officer's Certificate and an Opinion of
Counsel each stating that such conveyance or transfer and such
supplemental
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indenture comply with this Article III and that all conditions
precedent herein provided for relating to such transaction
have been complied with (including any filing required by the
Exchange Act).
SECTION 3.11. Successor or Transferee. (a) Upon any
consolidation or merger of the Issuer in accordance with Section 3.10(a), the
Person formed by or surviving such consolidation or merger (if other than the
Issuer) shall succeed to, and be substituted for, and may exercise every right
and power of, the Issuer under this Indenture with the same effect as if such
Person had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and
properties of the Issuer pursuant to Section 3.10(b), the Issuer shall be
released from every covenant and agreement of this Indenture to be observed or
performed on the part of the Issuer with respect to the Notes immediately upon
the delivery of written notice to the Indenture Trustee stating that the Issuer
is to be so released.
SECTION 3.12. No Other Business. The Issuer shall not engage
in any business other than financing, acquiring, owning and pledging the
Receivables in the manner contemplated by this Indenture and the Basic
Documents and activities incidental thereto.
SECTION 3.13. No Borrowing. The Issuer shall not issue,
incur, assume, guarantee or otherwise become liable, directly or indirectly,
for any indebtedness except for the Notes and the Certificates.
SECTION 3.14. Servicer's Obligations. The Issuer shall cause
the Servicer to comply with the Sale and Servicing Agreement, including
Sections 3.9, 3.10, 3.11, 3.12, 3.13 and 4.9 and Article VII thereof.
SECTION 3.15. Guarantees, Loans, Advances and Other
Liabilities. Except as contemplated by this Indenture and the other Basic
Documents, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance on any obligation or capability of so
doing or otherwise),
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endorse or otherwise become contingently liable, directly or indirectly, in
connection with the obligations, stocks or dividends of, or own, purchase,
repurchase or acquire (or agree contingently to do so) any stock, obligations,
assets or securities of, or any other interest in, or make any capital
contribution to, any other Person.
SECTION 3.16. Capital Expenditures. The Issuer shall not
make any expenditure (by long-term or operating lease or otherwise) for capital
assets (either realty or personalty).
SECTION 3.17. Further Instruments and Acts. Upon request of
the Indenture Trustee, the Issuer shall execute and deliver such further
instruments and do such further acts as may be reasonably necessary or proper
to carry out more effectively the purpose of this Indenture.
SECTION 3.18. Restricted Payments. The Issuer shall not,
directly or indirectly, (i) make any distribution (by reduction of capital or
otherwise), whether in cash, property, securities or a combination thereof, to
the Owner Trustee or any owner of a beneficial interest in the Issuer or
otherwise with respect to any ownership or equity interest or security in or of
the Issuer or to the Servicer or the Administrator, (ii) redeem, purchase,
retire or otherwise acquire for value any such ownership or equity interest or
security or (iii) set aside or otherwise segregate any amounts for any such
purpose; provided, however, that the Issuer may make, or cause to be made, (x)
payments to the Servicer, the Administrator, the Owner Trustee, the Indenture
Trustee, the Noteholders and the Certificateholders as contemplated by, and to
the extent funds are available for such purpose under, this Indenture and the
other Basic Documents and (y) payments to the Indenture Trustee pursuant to
Section 2(a)(ii) of the Administration Agreement. The Issuer shall not,
directly or indirectly, make payments to or distributions from the Collection
Account or the Principal Distribution Account except in accordance with this
Indenture and the other Basic Documents.
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SECTION 3.19. Notice of Events of Default. The Issuer shall
give the Indenture Trustee and the Rating Agencies prompt written notice of
each Event of Default hereunder and of each default on the part of any party to
the Sale and Servicing Agreement or the Purchase Agreement with respect to any
of the provisions thereof.
SECTION 3.20. Removal of Administrator. For so long as any
Notes are Outstanding, the Issuer shall not remove the Administrator without
cause unless the Rating Agency Condition shall have been satisfied in
connection therewith.
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ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1. Satisfaction and Discharge of Indenture. This
Indenture shall cease to be of further effect with respect to the Notes except
as to (i) rights of registration of transfer and exchange, (ii) substitution of
mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to
receive payments of principal thereof and interest thereon, (iv) Sections 3.3,
3.4, 3.5, 3.8, 3.10, 3.12 and 3.13, (v) the rights, obligations and immunities
of the Indenture Trustee hereunder (including the rights of the Indenture
Trustee under Section 6.7 and the obligations of the Indenture Trustee under
Section 4.3), and (vi) the rights of Noteholders as beneficiaries hereof with
respect to the property so deposited with the Indenture Trustee payable to all
or any of them, and the Indenture Trustee, on demand of and at the expense of
the Issuer, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to the Notes, when:
(A) either
(1) all Notes theretofore authenticated and
delivered (other than (i) Notes that have been destroyed,
lost or stolen and that have been replaced or paid as provided
in Section 2.6 and (ii) Notes for whose payment money has
theretofore been deposited in trust or segregated and held in
trust by the Issuer and thereafter repaid to the Issuer or
discharged from such trust, as provided in Section 3.3) have
been delivered to the Indenture Trustee for cancellation; or
(2) all Notes not theretofore delivered to the
Indenture Trustee for cancellation have become due and payable
and the Issuer has irrevocably deposited or caused to be
irrevocably deposited with the Indenture Trustee cash or
direct obligations of or obligations guaranteed by the United
States of America (which will mature prior to the date such
amounts are payable), in trust for such
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purpose, in an amount sufficient without reinvestment to pay
and discharge the entire indebtedness on such Notes not
theretofore delivered to the Indenture Trustee for
cancellation when due to the applicable Final Scheduled
Distribution Date or Redemption Date (if Notes shall have been
called for redemption pursuant to Section 10.1(a)), as the
case may be, and all fees due and payable to the Indenture
Trustee;
(B) the Issuer has paid or caused to be paid all other sums
payable hereunder and under any of the other Basic Documents
by the Issuer;
(C) the Issuer has delivered to the Indenture Trustee an
Officer's Certificate, an Opinion of Counsel and (if required
by the TIA or the Indenture Trustee) an Independent
Certificate from a firm of certified public accountants, each
meeting the applicable requirements of Section 11.1(a) and,
subject to Section 11.2, each stating that all conditions
precedent herein provided for relating to the satisfaction and
discharge of this Indenture have been complied with; and
(D) the Issuer has delivered to the Indenture Trustee an
Opinion of Counsel to the effect that the satisfaction and
discharge of the Notes pursuant to this Section 4.1 will not
cause any Noteholder to be treated as having sold or exchanged
any of its Notes for purposes of Section 1001 of the Code.
Upon the satisfaction and discharge of the Indenture pursuant to this Section
4.1, at the request of the Owner Trustee, the Indenture Trustee shall deliver
to the Owner Trustee a certificate of a Trustee Officer stating that all
Noteholders have been paid in full and stating whether, to the best knowledge
of such Trustee Officer, any claims remain against the Issuer in respect of the
Indenture and the Notes.
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SECTION 4.2. Satisfaction, Discharge and Defeasance of Notes.
(a) Upon satisfaction of the conditions set forth in
subsection (b) below, the Issuer shall be deemed to have paid and discharged
the entire indebtedness on all the outstanding Notes, and the provisions of
this Indenture, as it relates to such Notes, shall no longer be in effect (and
the Indenture Trustee, at the expense of the Issuer, shall execute proper
instruments acknowledging the same), except as to (i) rights of registration of
transfer and exchange, (ii) substitution of mutilated, destroyed, lost or
stolen Notes, (iii) rights of Noteholders to receive payments of principal
thereof and interest thereon, (iv) Sections 3.2, 3.3, 3.4, 3.5, 3.8, 3.10, 3.12
and 3.13, (v) the rights, obligations and immunities of the Indenture Trustee
hereunder (including the rights of the Indenture Trustee under Section 6.7 and
the obligations of the Indenture Trustee under Section 4.3), and (vi) the
rights of Noteholders as beneficiaries hereof with respect to the property so
deposited with the Indenture Trustee payable to all or any of them.
(b) The satisfaction, discharge and defeasance of the Notes
pursuant to subsection (a) of this Section 4.2 is subject to the satisfaction
of all of the following conditions:
(i) the Issuer has deposited or caused to be
deposited irrevocably (except as provided in Section 4.4) with the
Indenture Trustee as trust funds in trust, specifically pledged as
security for, and dedicated solely to, the benefit of the Noteholders,
which, through the payment of interest and principal in respect
thereof in accordance with their terms will provide, not later than
one day prior to the due date of any payment referred to below, money
in an amount sufficient, in the opinion of a nationally recognized
firm of independent certified public accountants expressed in a
written certification thereof delivered to the Indenture Trustee, to
pay and discharge the entire indebtedness on the outstanding Notes,
for principal thereof and interest thereon to the date of such deposit
(in the case of Notes that have become due
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and payable) or to the maturity of such principal and interest, as the
case may be;
(ii) such deposit will not result in a breach or
violation of, or constitute an event of default under, any other
agreement or instrument to which the Issuer is bound;
(iii) no Event of Default with respect to the Notes
shall have occurred and be continuing on the date of such deposit or
on the ninety-first (91st) day after such date;
(iv) the Issuer has delivered to the Indenture
Trustee an Opinion of Counsel to the effect that the satisfaction,
discharge and defeasance of the Notes pursuant to this Section 4.2
will not cause any Noteholder to be treated as having sold or
exchanged any of its Notes for purposes of Section 1001 of the Code;
and
(v) the Issuer has delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel, each
stating that all conditions precedent relating to the defeasance
contemplated by this Section 4.2 have been complied with.
SECTION 4.3. Application of Trust Money. All monies
deposited with the Indenture Trustee pursuant to Sections 4.1 and 4.2 shall be
held in trust and applied by it, in accordance with the provisions of the Notes
and this Indenture, to the payment, either directly or through any Note Paying
Agent, as the Indenture Trustee may determine, to the Noteholders of the
particular Notes for the payment or redemption of which such monies have been
deposited with the Indenture Trustee, of all sums due and to become due thereon
for principal and interest, but such monies need not be segregated from other
funds except to the extent required herein or in the Sale and Servicing
Agreement or required by law.
SECTION 4.4. Repayment of Monies Held by Note Paying Agent.
In connection with the satisfaction and discharge of this Indenture with
respect to the Notes, all monies then held by any Note Paying Agent other than
the Indenture Trustee under the provisions of this Indenture with respect to
such Notes shall, upon demand of
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the Issuer, be paid to the Indenture Trustee to be held and applied according
to Section 3.3 and thereupon such Note Paying Agent shall be released from all
further liability with respect to such monies.
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ARTICLE V
REMEDIES
SECTION 5.1. Events of Default. "Event of Default," wherever
used herein, means the occurrence of any one of the following events (whatever
the reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) default in the payment of any interest on any
Note when the same becomes due and payable on each
Distribution Date, and such default shall continue for a
period of five (5) days or more; provided that a default in
the payment of interest on the Class B Notes shall not be an
Event of Default until the principal amount of the outstanding
Class A-4 Notes has been reduced to zero; or
(ii) default in the payment of the principal of or
any installment of the principal of any Note when the same
becomes due and payable; or
(iii) default in the observance or performance of
any material covenant or agreement of the Issuer made in this
Indenture (other than a covenant or agreement, a default in
the observance or performance of which is elsewhere in this
Section 5.1 specifically dealt with), or any representation or
warranty of the Issuer made in this Indenture or in any
certificate or other writing delivered pursuant hereto or in
connection herewith proving to have been incorrect in any
material respect as of the time when the same shall have been
made, and such default shall continue or not be cured, or the
circumstance or condition in respect of which such
misrepresentation or warranty was incorrect shall not have
been eliminated or otherwise cured, for a period of sixty (60)
days or in the case of a materially incorrect representation
and warranty thirty
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(30) days, after there shall have been given, by registered or
certified mail, to the Issuer by the Indenture Trustee or to
the Issuer and the Indenture Trustee by the Noteholders of
Notes evidencing not less than 25% of the principal amount of
the Notes Outstanding, a written notice specifying such
default or incorrect representation or warranty and requiring
it to be remedied and stating that such notice is a "Notice of
Default" hereunder; or
(iv) the filing of a decree or order for relief by a
court having jurisdiction in the premises in respect of the
Issuer or any substantial part of the Indenture Trust Estate
in an involuntary case under any applicable federal or State
bankruptcy, insolvency or other similar law now or hereafter
in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the
Issuer or for any substantial part of the Indenture Trust
Estate, or ordering the winding-up or liquidation of the
Issuer's affairs, and such decree or order shall remain
unstayed and in effect for a period of sixty (60) consecutive
days; or
(v) the commencement by the Issuer of a voluntary
case under any applicable federal or State bankruptcy,
insolvency or other similar law now or hereafter in effect, or
the consent by the Issuer to the entry of an order for relief
in an involuntary case under any such law, or the consent by
the Issuer to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any
substantial part of the Indenture Trust Estate, or the making
by the Issuer of any general assignment for the benefit of
creditors, or the failure by the Issuer generally to pay its
debts as such debts become due, or the taking of any action by
the Issuer in furtherance of any of the foregoing.
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The Issuer shall deliver to the Indenture Trustee, within five (5) days after
the occurrence thereof, written notice in the form of an Officer's Certificate
of any event which with the giving of notice and the lapse of time would become
an Event of Default under clause (iii) above, its status and what action the
Issuer is taking or proposes to take with respect thereto.
SECTION 5.2. Acceleration of Maturity; Rescission and
Annulment. (a) If an Event of Default should occur and be continuing, then
and in every such case the Indenture Trustee or the Noteholders of Notes
evidencing not less than a majority of the principal amount of the Notes
Outstanding may declare all the Notes to be immediately due and payable, by a
notice in writing to the Issuer (and to the Indenture Trustee if given by
Noteholders), and upon any such declaration the unpaid principal amount of such
Notes, together with accrued and unpaid interest thereon through the date of
acceleration, shall become immediately due and payable.
(b) At any time after a declaration of acceleration of
maturity has been made and before a judgment or decree for payment of the
amount due has been obtained by the Indenture Trustee as hereinafter provided
in this Article V, the Noteholders of Notes evidencing not less than a majority
of the principal amount of the Notes Outstanding, by written notice to the
Issuer and the Indenture Trustee, may rescind and annul such declaration and
its consequences if:
(i) the Issuer has paid or deposited with the
Indenture Trustee a sum sufficient to pay:
(A) all payments of principal of and
interest on all Notes and all other amounts that would then be
due hereunder or upon such Notes if the Event of Default
giving rise to such acceleration had not occurred; and
(B) all sums paid or advanced by the
Indenture Trustee hereunder and the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee
and its agents and counsel; and
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(ii) all Events of Default, other than the
nonpayment of the principal of the Notes that has become due
solely by such acceleration, have been cured or waived as
provided in Section 5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
SECTION 5.3. Collection of Indebtedness and Suits for
Enforcement by Indenture Trustee. (a) The Issuer covenants that if (i)
default is made in the payment of any interest on any Note when the same
becomes due and payable, and such default continues for a period of five (5)
days, or (ii) default is made in the payment of the principal of or any
installment of the principal of any Note when the same becomes due and payable,
the Issuer shall, upon demand of the Indenture Trustee, pay to the Indenture
Trustee, for the benefit of the Noteholders, the whole amount then due and
payable on such Notes for principal and interest, with interest upon the
overdue principal and, to the extent payment at such rate of interest shall be
legally enforceable, upon overdue installments of interest at the applicable
Note Interest Rate borne by the Notes and in addition thereto such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Indenture Trustee and its agents, attorneys and counsel.
(b) In case the Issuer shall fail forthwith to pay such
amounts upon such demand, the Indenture Trustee, in its own name and as trustee
of an express trust, may institute a Proceeding for the collection of the sums
so due and unpaid, and may prosecute such Proceeding to judgment or final
decree, and may enforce the same against the Issuer or other obligor upon such
Notes and collect in the manner provided by law out of the property of the
Issuer or other obligor upon such Notes, wherever situated, the monies adjudged
or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the
Indenture Trustee may, as more particularly provided in Section 5.4, in its
discretion, proceed to protect and enforce its rights and the rights of
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the Noteholders, by such appropriate Proceedings as the Indenture Trustee shall
deem most effective to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper
remedy or legal or equitable right vested in the Indenture Trustee by this
Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or
any other obligor upon the Notes or any Person having or claiming an ownership
interest in the Indenture Trust Estate, Proceedings under Title 11 of the
United States Code or any other applicable federal or State bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, sequestrator or similar official
shall have been appointed for or taken possession of the Issuer or its property
or such other obligor or Person, or in case of any other comparable judicial
Proceedings relative to the Issuer or other obligor upon the Notes, or to the
creditors or property of the Issuer or such other obligor, the Indenture
Trustee, irrespective of whether the principal of any Notes shall then be due
and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Indenture Trustee shall have made any demand
pursuant to the provisions of this Section 5.3, shall be entitled and
empowered, by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the
whole amount of principal and interest owing and unpaid in
respect of the Notes and to file such other papers or
documents as may be necessary or advisable in order to have
the claims of the Indenture Trustee (including any claim for
reasonable compensation to the Indenture Trustee and each
predecessor Indenture Trustee, and their respective agents,
attorneys and counsel, and for reimbursement of all expenses
and liabilities incurred, and all advances and disbursements
made, by the Indenture Trustee and each predecessor Indenture
Trustee, except as a result of negligence or bad faith) and of
the Noteholders allowed in such Proceedings;
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(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the Noteholders in any
election of a trustee, a standby trustee or Person performing
similar functions in any such Proceedings;
(iii) to collect and receive any monies or other
property payable or deliverable on any such claims and to pay
all amounts received with respect to the claims of the
Noteholders and of the Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have
the claims of the Indenture Trustee or the Noteholders allowed
in any judicial proceedings relative to the Issuer, its
creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Indenture Trustee and, in the event that the Indenture Trustee
shall consent to the making of payments directly to such Noteholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances and disbursements made, by the Indenture
Trustee and each predecessor Indenture Trustee, except as a result of
negligence or bad faith, and any other amounts due the Indenture Trustee
pursuant to Section 6.7.
(e) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Noteholder or to authorize
the Indenture Trustee to vote in respect of the claim of any Noteholder in any
such proceeding except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar Person.
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(f) All rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture Trustee
without the possession of any of the Notes or the production thereof in any
trial or other Proceedings relative thereto, and any such action or Proceedings
instituted by the Indenture Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment, subject to the payment of
the expenses, disbursements and compensation of the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents, attorneys and
counsel, shall be for the ratable benefit of the Noteholders in respect of
which such judgment has been recovered.
(g) In any Proceedings brought by the Indenture Trustee (and
also any Proceedings involving the interpretation of any provision of this
Indenture to which the Indenture Trustee shall be a party), the Indenture
Trustee shall be held to represent all the Noteholders, and it shall not be
necessary to make any Noteholder a party to any such Proceedings.
SECTION 5.4. Remedies; Priorities. (a) If an Event of
Default shall have occurred and be continuing, the Indenture Trustee may do one
or more of the following (subject to Section 5.5):
(i) institute Proceedings in its own name and as
trustee of an express trust for the collection of all amounts
then payable on the Notes or under this Indenture with respect
thereto, whether by declaration or otherwise, enforce any
judgment obtained, and collect from the Issuer and any other
obligor upon such Notes monies adjudged due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect
to the Indenture Trust Estate;
(iii) exercise any remedies of a secured party under
the UCC and take any other appropriate action to protect and
enforce the rights and remedies of the Indenture Trustee and
the Noteholders; and
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(iv) sell the Indenture Trust Estate or any portion
thereof or rights or interest therein, at one or more public
or private sales called and conducted in any manner permitted
by law;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate following an Event of Default, other than
an Event of Default described in Section 5.1(i) or (ii) and other than if
required to sell the Indenture Trust Estate pursuant to the Trust Agreement as
a result of the occurrence of an Insolvency Event or a dissolution with respect
to the Seller or the General Partner, unless (x)(A) the Noteholders of Notes
evidencing 100% of the principal amount of the Notes Outstanding consent
thereto, (B) the proceeds of such sale or liquidation are sufficient to pay in
full the principal of and the accrued interest on the outstanding Notes or (C)
the Indenture Trustee determines (but shall have no obligation to make such
determination) that the Indenture Trust Estate will not continue to provide
sufficient funds for the payment of principal of and interest on the Notes as
they would have become due if the Notes had not been declared due and payable,
and the Indenture Trustee obtains the consent of Noteholders of Notes
evidencing not less than 66 2/3% of the principal amount of the Notes
Outstanding and (y) with respect to an Event of Default described in Section
5.1(iii), (A) the Certificateholders of all outstanding Certificates consent
thereto or (B) the proceeds of such sale or liquidation are sufficient to pay
in full the principal of and accrued interest on the outstanding Notes and
Certificates. In determining such sufficiency or insufficiency with respect to
clauses (x)(B), (x)(C) and (y)(B) above, the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Indenture Trust Estate for such
purpose.
(b) If the Indenture Trustee collects any money or property
pursuant to this Article V, it shall pay out the money or property in the
following order:
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(i) first, to the Indenture Trustee for amounts due
under Section 6.7;
(ii) second, to the Servicer for due and unpaid
Servicing Fees;
(iii) third, to Noteholders of the Class A Notes for
amounts due and unpaid on the Class A Notes in respect of
interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class A Notes
for interest;
(iv) fourth, to Noteholders of the Class A-1 Notes
for amounts due and unpaid on the Class A-1 Notes for
principal, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Class
A-1 Notes for principal, until the principal amount of the
outstanding Class A-1 Notes is reduced to zero;
(v) fifth, to Noteholders of the Class A-2 Notes for
amounts due and unpaid on the Class A-2 Notes for principal,
ratably, without preference or priority of any kind, according
to the amounts due and payable on the Class A-2 Notes for
principal, until the principal amount of the outstanding Class
A-2 Notes is reduced to zero;
(vi) sixth, to Noteholders of the Class A-3 Notes
for amounts due and unpaid on the Class A-3 Notes for
principal, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Class
A-3 Notes for principal, until the principal amount of the
outstanding Class A-3 Notes is reduced to zero;
(vii) seventh, to Noteholders of the Class A-4 Notes
for amounts due and unpaid on the Class A-4 Notes for
principal, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Class
A-4 Notes for principal, until the
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principal amount of the outstanding Class A-4 Notes is reduced
to zero;
(viii) eighth, to Noteholders of the Class B Notes
for amounts due and unpaid on the Class B Notes in respect of
interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class B Notes
for interest;
(ix) ninth, to Noteholders of the Class B Notes for
amounts due and unpaid on the Class B Notes for principal,
ratably, without preference or priority of any kind, according
to the amounts due and payable on the Class B Notes for
principal, until the principal amount of the outstanding Class
B Notes is reduced to zero; and
(x) tenth, to the Issuer for amounts required to be
distributed to the Certificateholders pursuant to the Trust
Agreement and the Sale and Servicing Agreement.
The Indenture Trustee may fix a record date and payment date for any payment to
Noteholders pursuant to this Section 5.4. At least fifteen (15) days before
such record date, the Issuer shall mail to each Noteholder and the Indenture
Trustee a notice that states the record date, the payment date and the amount
to be paid.
SECTION 5.5. Optional Preservation of the Receivables. If
the Notes have been declared to be due and payable under Section 5.2 following
an Event of Default, and such declaration and its consequences have not been
rescinded and annulled, the Indenture Trustee may, but need not, elect to
maintain possession of the Indenture Trust Estate and apply proceeds as if
there had been no declaration of acceleration; provided, however, that funds on
deposit in the Collection Account (including funds, if any, deposited therein
from the Reserve Account and the Payahead Account) shall be applied in
accordance with such declaration of acceleration in the manner specified in
Section 4.6(c) of the Sale and Servicing Agreement. It is the desire of the
parties hereto and the Noteholders that there be at all
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times sufficient funds for the payment of principal of and interest on the
Notes, and the Indenture Trustee shall take such desire into account when
determining whether or not to maintain possession of the Indenture Trust
Estate. In determining whether to maintain possession of the Indenture Trust
Estate, the Indenture Trustee may, but need not, obtain and rely upon an
opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Indenture Trust Estate for such purpose.
SECTION 5.6. Limitation of Suits. No Noteholder shall have
any right to institute any Proceeding, judicial or otherwise, with respect to
this Indenture or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless:
(a) such Noteholder has previously given written
notice to the Indenture Trustee of a continuing Event of
Default;
(b) the Noteholders of Notes evidencing not less
than 25% of the principal amount of the Notes Outstanding have
made written request to the Indenture Trustee to institute
such Proceeding in respect of such Event of Default in its own
name as Indenture Trustee hereunder;
(c) such Noteholder or Noteholders have offered to
the Indenture Trustee reasonable indemnity against the costs,
expenses and liabilities to be incurred in complying with such
request;
(d) the Indenture Trustee for sixty (60) days after
its receipt of such notice, request and offer of indemnity has
failed to institute such Proceedings; and
(e) no direction inconsistent with such written
request has been given to the Indenture Trustee during such
sixty-day period by the Noteholders of Notes evidencing not
less than a majority of the principal amount of the Notes
Outstanding.
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It is understood and intended that no one or more Noteholders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other
Noteholders or to obtain or to seek to obtain priority or preference over any
other Noteholders or to enforce any right under this Indenture, except in the
manner herein provided.
In the event the Indenture Trustee shall receive conflicting
or inconsistent requests and indemnity from two or more groups of Noteholders,
each evidencing less than a majority of the principal amount of the Notes
Outstanding, the Indenture Trustee in its sole discretion may determine what
action, if any, shall be taken, notwithstanding any other provisions of this
Indenture.
SECTION 5.7. Unconditional Rights of Noteholders To Receive
Principal and Interest. Notwithstanding any other provisions in this
Indenture, any Noteholder shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest, if any, on
its Note on or after the respective due dates thereof expressed in such Note or
in this Indenture (or, in the case of redemption, on or after the Redemption
Date) and to institute suit for the enforcement of any such payment, and such
right shall not be impaired without the consent of such Noteholder.
SECTION 5.8. Restoration of Rights and Remedies. If the
Indenture Trustee or any Noteholder has instituted any Proceeding to enforce
any right or remedy under this Indenture and such Proceeding has been
discontinued or abandoned for any reason or has been determined adversely to
the Indenture Trustee or to such Noteholder, then and in every such case the
Issuer, the Indenture Trustee and the Noteholders shall, subject to any
determination in such Proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Indenture Trustee and the Noteholders shall continue as though no such
Proceeding had been instituted.
SECTION 5.9. Rights and Remedies Cumulative. No right or
remedy herein conferred upon or reserved to the Indenture Trustee or to the
Noteholders is intended
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to be exclusive of any other right or remedy, and every right and remedy shall,
to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.10. Delay or Omission Not a Waiver. No delay or
omission of the Indenture Trustee or any Noteholder to exercise any right or
remedy accruing upon any Default or Event of Default shall impair any such
right or remedy or constitute a waiver of any such Default or Event of Default
or any acquiescence therein. Every right and remedy given by this Article V or
by law to the Indenture Trustee or to the Noteholders may be exercised from
time to time, and as often as may be deemed expedient, by the Indenture Trustee
or by the Noteholders, as the case may be.
SECTION 5.11. Control by Noteholders. The Noteholders of
Notes evidencing not less than a majority of the principal amount of the Notes
Outstanding shall have the right to direct the time, method and place of
conducting any Proceeding for any remedy available to the Indenture Trustee
with respect to the Notes or exercising any trust or power conferred on the
Indenture Trustee; provided that:
(a) such direction shall not be in conflict with any
rule of law or with this Indenture;
(b) subject to the express terms of Section 5.4, any
direction to the Indenture Trustee to sell or liquidate the
Indenture Trust Estate shall be by Noteholders of Notes
evidencing not less than 100% of the principal amount of the
Notes Outstanding;
(c) if the conditions set forth in Section 5.5 have
been satisfied and the Indenture Trustee elects to retain the
Indenture Trust Estate pursuant to such Section 5.5, then any
direction to the Indenture Trustee by Noteholders of Notes
evidencing less than 100%
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of the principal amount of the Notes Outstanding to sell or
liquidate the Indenture Trust Estate shall be of no force and
effect; and
(d) the Indenture Trustee may take any other action
deemed proper by the Indenture Trustee that is not
inconsistent with such direction.
Notwithstanding the rights of Noteholders set forth in this Section 5.11,
subject to Section 6.1, the Indenture Trustee need not take any action that it
determines might involve it in costs or expenses for which it would not be
adequately indemnified or expose it to personal liability or might materially
adversely affect or unduly prejudice the rights of any Noteholders not
consenting to such action.
SECTION 5.12. Waiver of Past Defaults. Prior to the
declaration of the acceleration of the maturity of the Notes as provided in
Section 5.2, the Noteholders of Notes evidencing not less than a majority of
the principal amount of the Notes Outstanding may waive any past Default or
Event of Default and its consequences except a Default (a) in the payment of
principal of or interest on any of the Notes or (b) in respect of a covenant or
provision hereof that cannot be amended, supplemented or modified without the
consent of each Noteholder. In the case of any such waiver, the Issuer, the
Indenture Trustee and the Noteholders shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereto.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have been cured and not to have occurred,
for every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereto.
SECTION 5.13. Undertaking for Costs. All parties to this
Indenture agree, and each Noteholder by such Noteholder's acceptance thereof
shall be deemed to
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have agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 5.13 shall not apply to (a) any suit instituted by
the Indenture Trustee, (b) any suit instituted by any Noteholder or group of
Noteholders, in each case holding in the aggregate more than 10% of the
principal amount of the Notes Outstanding or (c) any suit instituted by any
Noteholder for the enforcement of the payment of principal of or interest on
any Note on or after the respective due dates expressed in such Note and in
this Indenture (or, in the case of redemption, on or after the Redemption
Date).
SECTION 5.14. Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it shall not at any
time insist upon, or plead or in any manner whatsoever, claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, that may affect the covenants or the performance
of this Indenture, and the Issuer (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it shall not hinder, delay or impede the execution of any power herein
granted to the Indenture Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
SECTION 5.15. Action on Notes. The Indenture Trustee's right
to seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under or
with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be
impaired by the recovery of any judgment by the Indenture Trustee against the
Issuer or by the levy of any execution under such judgment upon any portion of
the
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Indenture Trust Estate or upon any of the assets of the Issuer. Any money or
property collected by the Indenture Trustee shall be applied in accordance with
Section 5.4(b).
SECTION 5.16. Performance and Enforcement of Certain
Obligations. (a) Promptly following a request from the Indenture Trustee to do
so, and at the Administrator's expense, the Issuer shall take all such lawful
action as the Indenture Trustee may request to compel or secure the performance
and observance by the Seller and the Servicer, as applicable, of each of their
obligations to the Issuer under or in connection with the Sale and Servicing
Agreement, or by the Seller and Ford Credit, as applicable, of each of their
obligations under or in connection with the Purchase Agreement, and to exercise
any and all rights, remedies, powers and privileges lawfully available to the
Issuer under or in connection with the Sale and Servicing Agreement and the
Purchase Agreement, as the case may be, to the extent and in the manner
directed by the Indenture Trustee, including the transmission of notices of
default on the part of the Seller, the Servicer or Ford Credit thereunder and
the institution of legal or administrative actions or proceedings to compel or
secure performance by the Seller or the Servicer of each of their obligations
under the Sale and Servicing Agreement or by the Seller or Ford Credit of each
of their obligations under the Purchase Agreement.
(b) If an Event of Default has occurred and is continuing,
the Indenture Trustee may, and at the direction (which direction shall be in
writing or by telephone, confirmed in writing promptly thereafter) of the
Noteholders of Notes evidencing not less than 66 2/3% of the principal amount
of the Notes Outstanding shall, exercise all rights, remedies, powers,
privileges and claims of the Issuer against the Seller or the Servicer under or
in connection with the Sale and Servicing Agreement, or against the Seller or
Ford Credit under or in connection with the Purchase Agreement, including the
right or power to take any action to compel or secure performance or observance
by the Seller, the Servicer or Ford Credit, as the case may be, of each of
their obligations to the Issuer thereunder and to give any consent, request,
notice, direction, approval, extension, or waiver under the Sale and Servicing
Agreement or the Purchase
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Agreement, as the case may be, and any right of the Issuer to take such action
shall be suspended.
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ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1. Duties of Indenture Trustee. (a) If an Event
of Default has occurred and is continuing, the Indenture Trustee shall exercise
the rights and powers vested in it by this Indenture and use the same degree of
care and skill in their exercise as a prudent Person would exercise or use
under the circumstances in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set forth in
this Indenture and no implied covenants or obligations shall
be read into this Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the
Indenture Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Indenture Trustee and, if required by the terms of this
Indenture, conforming to the requirements of this Indenture;
provided, however, that the Indenture Trustee shall examine
the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act or its own
willful misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section 6.1;
(ii) the Indenture Trustee shall not be liable for
any error of judgment made in good faith by a Trustee Officer
unless it is proved
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that the Indenture Trustee was negligent in ascertaining the
pertinent facts; and
(iii) the Indenture Trustee shall not be liable with
respect to any action it takes or omits to take in good faith
in accordance with a direction received by it pursuant to
Section 5.11.
(d) The Indenture Trustee shall not be liable for interest on
any money received by it except as the Indenture Trustee may agree in writing
with the Issuer.
(e) Money held in trust by the Indenture Trustee need not be
segregated from other funds except to the extent required by law or the terms
of this Indenture or the Sale and Servicing Agreement.
(f) No provision of this Indenture shall require the
Indenture Trustee to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder or in the exercise
of any of its rights or powers, if it shall have reasonable grounds to believe
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(g) Every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section 6.1 and to the provisions of
the TIA.
(h) The Indenture Trustee shall not be charged with knowledge
of any Event of Default unless either (1) a Trustee Officer shall have actual
knowledge of such Event of Default or (2) written notice of such Event of
Default shall have been given to the Indenture Trustee in accordance with the
provisions of this Indenture.
SECTION 6.2. Rights of Indenture Trustee. (a) The Indenture
Trustee may rely and shall be protected in acting or refraining from acting
upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture or other paper or
document believed by
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it to be genuine and to have been signed or presented by the proper Person.
The Indenture Trustee need not investigate any fact or matters stated in any
such document.
(b) Before the Indenture Trustee acts or refrains from
acting, it may require an Officer's Certificate or an Opinion of Counsel. The
Indenture Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on an Officer's Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian or nominee, and the Indenture
Trustee shall not be responsible for any misconduct or negligence on the part
of, or for the supervision of, any such agent, attorney, custodian or nominee
appointed with due care by it hereunder.
(d) The Indenture Trustee shall not be liable for any action
it takes or omits to take in good faith which it believes to be authorized or
within its rights or powers; provided, however, that such action or omission by
the Indenture Trustee does not constitute willful misconduct, negligence or bad
faith.
(e) The Indenture Trustee may consult with counsel, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and protection
from liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the advice or opinion of such
counsel.
(f) The Indenture Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Indenture or to honor
the request or direction of any of the Noteholders pursuant to this Indenture
unless such Noteholders shall have offered to the Indenture Trustee reasonable
security or indemnity against the reasonable costs, expenses, disbursements,
advances and liabilities which might be incurred by it, its agents and its
counsel in compliance with such request or direction.
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(g) Any request or direction of the Issuer mentioned herein
shall be sufficiently evidenced by an Issuer Request.
SECTION 6.3. Individual Rights of Indenture Trustee. The
Indenture Trustee, in its individual or any other capacity, may become the
owner or pledgee of Notes and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Indenture Trustee.
Any Note Paying Agent, Note Registrar, co-registrar or co-paying agent
hereunder may do the same with like rights.
SECTION 6.4. Indenture Trustee's Disclaimer. The Indenture
Trustee (i) shall not be responsible for, and makes no representation as to,
the validity or adequacy of this Indenture or the Notes and (ii) shall not be
accountable for the Issuer's use of the proceeds from the Notes, or responsible
for any statement of the Issuer in this Indenture or in any document issued in
connection with the sale of the Notes or in the Notes (all of which shall be
taken as statements of the Issuer) other than the Indenture Trustee's
certificate of authentication.
SECTION 6.5. Notice of Defaults; Insolvency or Dissolution of
Depositor or General Partner. (a) If a Default occurs and is continuing and
if it is known to a Trustee Officer of the Indenture Trustee, the Indenture
Trustee shall mail to each Noteholder notice of such Default within ninety (90)
days after it occurs. Except in the case of a Default in payment of principal
of or interest on any Note (including payments pursuant to the mandatory
redemption provisions of such Note), the Indenture Trustee may withhold the
notice if and so long as a committee of its Trustee Officers in good faith
determines that withholding the notice is in the interests of Noteholders.
(b) If the Indenture Trustee receives notice from the Owner
Trustee of the occurrence of an Insolvency Event or a dissolution with respect
to the Depositor or the General Partner pursuant to Section 9.2 of the Trust
Agreement, the Indenture Trustee shall give prompt written notice to the
Noteholders of the occurrence of such event. If the Indenture Trustee receives
notice from the Owner Trustee pursuant to such Section
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9.2 that the requisite percentages of Noteholders, Certificateholders and
holders of interests, if any, in the Reserve Account disapprove of the
liquidation of the Receivables and termination of the Trust pursuant to such
Section 9.2, the Indenture Trustee, at the expense of the Issuer, shall (i)
appoint an entity acceptable to Ford Credit to acquire an interest in the Trust
and to act as substitute "general partner" of the Trust for federal income tax
purposes and (ii) obtain an Opinion of Counsel that the Trust will not
thereafter be classified as an association (or publicly traded partnership)
taxable as a corporation for federal income tax and Applicable Tax State
purposes. If the Indenture Trustee is unable to locate such an entity or
obtain such Opinion of Counsel within ninety (90) days after the date of the
applicable Insolvency Event or dissolution, the Indenture Trustee shall so
notify the Owner Trustee promptly in writing. Upon termination of the Trust
pursuant to such Section 9.2, the Indenture Trustee shall, if so directed by
the Owner Trustee, sell the assets of the Trust (other than the Trust Accounts
and each Certificate Distribution Account) in a commercially reasonable manner
and on commercially reasonable terms. The proceeds of such a sale of the
assets of the Trust shall be treated as collections of Receivables under the
Sale and Servicing Agreement and deposited in the Collection Account and the
Notes and Certificates shall be paid in accordance with Section 4.6 of the Sale
and Servicing Agreement.
SECTION 6.6. Reports by Indenture Trustee to Noteholders.
Upon delivery to the Indenture Trustee by the Servicer of such information
prepared by the Servicer pursuant to Section 3.9 of the Sale and Servicing
Agreement as may be required to enable each Noteholder to prepare its federal
and State income tax returns, the Indenture Trustee shall deliver such
information to the Noteholders.
SECTION 6.7. Compensation and Indemnity. (a) The Issuer
shall, or shall cause the Administrator to, pay to the Indenture Trustee from
time to time reasonable compensation for its services. The Indenture Trustee's
compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Issuer shall, or shall cause the Administrator to,
reimburse the Indenture Trustee for all reasonable out-of-
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pocket expenses incurred or made by it, including costs of collection, in
addition to the compensation for its services. Such expenses shall include the
reasonable compensation and expenses, disbursements and advances of the
Indenture Trustee's agents, counsel, accountants and experts. The Issuer
shall, or shall cause the Administrator to, indemnify the Indenture Trustee
for, and to hold it harmless against, any and all loss, liability or expense
(including attorneys' fees) incurred by it in connection with the
administration of this trust and the performance of its duties hereunder,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers
or duties hereunder. The Indenture Trustee shall notify the Issuer and the
Administrator promptly of any claim for which it may seek indemnity. Failure
by the Indenture Trustee to so notify the Issuer and the Administrator shall
not relieve the Issuer or the Administrator of its obligations hereunder. The
Issuer shall, or shall cause the Administrator to, defend any such claim, and
the Indenture Trustee may have separate counsel and the Issuer shall, or shall
cause the Administrator to, pay the fees and expenses of such counsel. Neither
the Issuer nor the Administrator need reimburse any expense or indemnity
against any loss, liability or expense incurred by the Indenture Trustee
through the Indenture Trustee's own willful misconduct, negligence or bad
faith.
(b) The Issuer's payment obligations to the Indenture Trustee
pursuant to this Section 6.7 shall survive the resignation or removal of the
Indenture Trustee and the discharge of this Indenture. When the Indenture
Trustee incurs expenses after the occurrence of a Default specified in Section
5.1(iv) or (v) with respect to the Issuer, the expenses are intended to
constitute expenses of administration under Title 11 of the United States Code
or any other applicable federal or State bankruptcy, insolvency or similar law.
SECTION 6.8. Replacement of Indenture Trustee. (a) No
resignation or removal of the Indenture Trustee, and no appointment of a
successor Indenture Trustee, shall become effective until the acceptance of
appointment by the successor Indenture Trustee pursuant to this Section 6.8 and
payment in full of all sums due to the Indenture Trustee pursuant to Section
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6.7. The Indenture Trustee may resign at any time by so notifying the Issuer.
The Noteholders of Notes evidencing not less than a majority in principal
amount of the Notes Outstanding may remove the Indenture Trustee without cause
by so notifying the Indenture Trustee and the Issuer and may appoint a
successor Indenture Trustee. The Issuer shall remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with
Section 6.11;
(ii) an Insolvency Event occurs with respect to the
Indenture Trustee;
(iii) a receiver or other public officer takes
charge of the Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes
incapable of acting.
If the Indenture Trustee resigns or is removed or if a vacancy exists in the
office of Indenture Trustee for any reason (the Indenture Trustee in such event
being referred to herein as the retiring Indenture Trustee), the Issuer shall
promptly appoint a successor Indenture Trustee.
(b) Any successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee and to the
Issuer. Thereupon, if all sums due the retiring Indenture Trustee pursuant to
Section 6.7 have been paid in full, the resignation or removal of the retiring
Indenture Trustee shall become effective, and the successor Indenture Trustee
shall have all the rights, powers and duties of the Indenture Trustee under
this Indenture. The successor Indenture Trustee shall mail a notice of its
succession to Noteholders. If all sums due the retiring Indenture Trustee
pursuant to Section 6.7 have been paid in full, the retiring Indenture Trustee
shall promptly transfer all property held by it as Indenture Trustee to the
successor Indenture Trustee.
(c) If a successor Indenture Trustee does not take office
within sixty (60) days after the retiring Indenture Trustee resigns or is
removed, the retiring
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Indenture Trustee, the Issuer or the Noteholders of Notes evidencing not less
than a majority in principal amount of the Notes Outstanding may petition any
court of competent jurisdiction for the appointment of a successor Indenture
Trustee. If the Indenture Trustee fails to comply with Section 6.11, any
Noteholder who has been a bona fide Noteholder for at least six (6) months may
petition any court of competent jurisdiction for the removal of the Indenture
Trustee and the appointment of a successor Indenture Trustee.
(d) Notwithstanding the replacement of the Indenture Trustee
pursuant to this Section 6.8, the obligations of the Issuer and the
Administrator under Section 6.7 shall continue for the benefit of the retiring
Indenture Trustee.
SECTION 6.9. Successor Indenture Trustee by Merger. (a) If
the Indenture Trustee consolidates with, merges or converts into, or transfers
all or substantially all its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation or banking association without any further act shall be the
successor Indenture Trustee; provided that such corporation or banking
association shall be otherwise qualified and eligible under Section 6.11. The
Indenture Trustee shall provide the Rating Agencies with prior written notice
of any such transaction.
(b) In case at the time such successor or successors by
merger, conversion or consolidation to the Indenture Trustee shall succeed to
the trusts created by this Indenture any of the Notes shall have been
authenticated but not delivered, any such successor to the Indenture Trustee
may adopt the certificate of authentication of any predecessor trustee, and
deliver such Notes so authenticated; and in case at that time any of the Notes
shall not have been authenticated, any successor to the Indenture Trustee may
authenticate such Notes either in the name of any predecessor hereunder or in
the name of the successor to the Indenture Trustee. In all such cases such
certificates shall have the full force which it is anywhere in the Notes or in
this Indenture provided that the certificate of the Indenture Trustee shall
have.
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SECTION 6.10. Appointment of Co-Indenture Trustee or Separate
Indenture Trustee. (a) Notwithstanding any other provisions of this
Indenture, at any time, for the purpose of meeting any legal requirement of any
jurisdiction in which any part of the Indenture Trust Estate may at the time be
located, the Indenture Trustee shall have the power and may execute and deliver
an instrument to appoint one or more Persons to act as a co-trustee or co-
trustees, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person or Persons, in such capacity and for the
benefit of the Noteholders, such title to the Indenture Trust Estate, or any
part hereof, and, subject to the other provisions of this Section 6.10, such
powers, duties, obligations, rights and trusts as the Indenture Trustee may
consider necessary or desirable. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 6.11 and no notice to Noteholders of the appointment of any co-trustee
or separate trustee shall be required under Section 6.8.
(b) Every separate trustee and co-trustee shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all rights, powers, duties and obligations
conferred or imposed upon the Indenture Trustee shall be
conferred or imposed upon and exercised or performed by the
Indenture Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or
co-trustee shall not be authorized to act separately without
the Indenture Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any
particular act or acts are to be performed the Indenture
Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Indenture
Trust Estate or any portion thereof in any such jurisdiction)
shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the
Indenture Trustee;
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(ii) no trustee hereunder shall be personally liable
by reason of any act or omission of any other trustee
hereunder; and
(iii) the Indenture Trustee may at any time accept
the resignation of or remove any separate trustee or
co-trustee.
(c) Any notice, request or other writing given to the
Indenture Trustee shall be deemed to have been given to each of the then
separate trustees and co-trustees, as effectively as if given to each of them.
Every instrument appointing any separate trustee or co-trustee shall refer to
this Indenture and the conditions of this Article VI. Each separate trustee
and co-trustee, upon its acceptance of the trusts conferred, shall be vested
with the estates or property specified in its instrument of appointment, either
jointly with the Indenture Trustee or separately, as may be provided therein,
subject to all the provisions of this Indenture, specifically including every
provision of this Indenture relating to the conduct of, affecting the liability
of, or affording protection to, the Indenture Trustee. Every such instrument
shall be filed with the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time
constitute the Indenture Trustee its agent or attorney-in-fact with full power
and authority, to the extent not prohibited by law, to do any lawful act under
or in respect of this Agreement on its behalf and in its name. If any separate
trustee or co-trustee shall die, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall vest
in and be exercised by the Indenture Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee.
SECTION 6.11. Eligibility; Disqualification. The Indenture
Trustee shall at all times satisfy the requirements of TIA Section 310(a). The
Indenture Trustee or its parent shall have a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published annual report of
condition and shall have a long-term debt rating of investment grade by each of
the Rating Agencies or shall otherwise be acceptable
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to each of the Rating Agencies. The Indenture Trustee shall comply with TIA
Section 310(b).
Within ninety (90) days after ascertaining the occurrence of an Event
of Default which shall not have been cured or waived, unless authorized by the
Commission, the Indenture Trustee shall resign with respect to the Class A
Notes and/or the Class B Notes in accordance with Section 6.8 of this
Indenture, and the Issuer shall appoint a successor Indenture Trustee for one
or both of such Classes, as applicable, so that there will be separate
Indenture Trustees for the Class A Notes and the Class B Notes. In the event
the Indenture Trustee fails to comply with the terms of the preceding sentence,
the Indenture Trustee shall comply with clauses (ii) and (iii) of TIA Section
310(b).
In the case of the appointment hereunder of a successor Indenture
Trustee with respect to any Class of Notes pursuant to this Section 6.11, the
Issuer, the retiring Indenture Trustee and the successor Indenture Trustee with
respect to such Class of Notes shall execute and deliver an indenture
supplemental hereto wherein each successor Indenture Trustee shall accept such
appointment and which (i) shall contain such provisions as shall be necessary
or desirable to transfer and confirm to, and to vest in, the successor
Indenture Trustee all the rights, powers, trusts and duties of the retiring
Indenture Trustee with respect to the Notes of the Class to which the
appointment of such successor Indenture Trustee relates, (ii) if the retiring
Indenture Trustee is not retiring with respect to all Classes of Notes, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Indenture
Trustee with respect to the Notes of each Class as to which the retiring
Indenture Trustee is not retiring shall continue to be vested in the Indenture
Trustee and (iii) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Indenture Trustee, it being understood
that nothing herein or in such supplemental indenture shall constitute such
Indenture Trustees co-trustees of the same trust and that each such Indenture
Trustee shall be a trustee of a trust or trusts hereunder separate and apart
from any trust or trusts hereunder administered
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by any other such Indenture Trustee; and upon the removal of the retiring
Indenture Trustee shall become effective to the extent provided herein.
SECTION 6.12. Preferential Collection of Claims Against
Issuer. The Indenture Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311(b). An Indenture Trustee
who has resigned or been removed shall be subject to TIA Section 311(a) to the
extent indicated.
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ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1. Issuer To Furnish Indenture Trustee Names and
Addresses of Noteholders. The Issuer shall furnish or cause to be furnished to
the Indenture Trustee (a) not more than five (5) days after each Record Date, a
list, in such form as the Indenture Trustee may reasonably require, of the
names and addresses of the Noteholders as of such Record Date and (b) at such
other times as the Indenture Trustee may request in writing, within thirty (30)
days after receipt by the Issuer of any such request, a list of similar form
and content as of a date not more than ten (10) days prior to the time such
list is furnished; provided, however, that (i) so long as the Indenture Trustee
is the Note Registrar, no such list shall be required to be furnished and (ii)
no such list shall be required to be furnished with respect to Noteholders of
Book-Entry Notes.
SECTION 7.2. Preservation of Information; Communications to
Noteholders. (a) The Indenture Trustee shall preserve, in as current a form
as is reasonably practicable, the names and addresses of the Noteholders
contained in the most recent list furnished to the Indenture Trustee as
provided in Section 7.1 and the names and addresses of Noteholders received by
the Indenture Trustee in its capacity as Note Registrar. The Indenture Trustee
may destroy any list furnished to it as provided in such Section 7.1 upon
receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA Section
312(b) with other Noteholders with respect to their rights under this Indenture
or under the Notes. Upon receipt by the Indenture Trustee of any request by
three or more Noteholders or by one or more Noteholders of Notes evidencing not
less than 25% of the Notes Outstanding to receive a copy of the current list of
Noteholders (whether or not made pursuant to TIA Section 312(b)), the Indenture
Trustee shall promptly notify the Administrator thereof by providing to the
Administrator a copy of such request and a copy of the list of Noteholders
produced in response thereto.
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(c) The Issuer, the Indenture Trustee and the Note Registrar
shall have the protection of TIA Section 312(c).
SECTION 7.3. Reports by Issuer. (a) The Issuer shall:
(i) file with the Indenture Trustee, within fifteen
(15) days after the Issuer is required to file the same with
the Commission, copies of the annual reports and of the
information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) that the
Issuer may be required to file with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the
Commission in accordance with the rules and regulations
prescribed from time to time by the Commission such additional
information, documents and reports with respect to compliance
by the Issuer with the conditions and covenants of this
Indenture as may be required from time to time by such rules
and regulations; and
(iii) supply to the Indenture Trustee (and the
Indenture Trustee shall transmit by mail to all Noteholders
described in TIA Section 313(c)) such summaries of any
information, documents and reports required to be filed by the
Issuer pursuant to clauses (i) and (ii) of this Section 7.3(a)
and by rules and regulations prescribed from time to time by
the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year
of the Issuer shall correspond to the calendar year.
SECTION 7.4. Reports by Indenture Trustee. (a) If required
by TIA Section 313(a), within sixty (60) days after each May 15, beginning with
May 15, 1999, the Indenture Trustee shall mail to each
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Noteholder as required by TIA Section 313(c) a brief report dated as of such
date that complies with TIA Section 313(a). The Indenture Trustee also shall
comply with TIA Section 313(b).
(b) A copy of each report at the time of its mailing to
Noteholders shall be filed by the Indenture Trustee with the Commission and
each stock exchange, if any, on which the Notes are listed. The Issuer shall
notify the Indenture Trustee if and when the Notes are listed on any stock
exchange.
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ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1. Collection of Money. Except as otherwise
expressly provided herein, the Indenture Trustee may demand payment or delivery
of, and shall receive and collect, directly and without intervention or
assistance of any fiscal agent or other intermediary, all money and other
property payable to or receivable by the Indenture Trustee pursuant to this
Indenture and the Sale and Servicing Agreement. The Indenture Trustee shall
apply all such money received by it as provided in this Indenture and the Sale
and Servicing Agreement. Except as otherwise expressly provided in this
Indenture, if any default occurs in the making of any payment or performance
under any agreement or instrument that is part of the Indenture Trust Estate,
the Indenture Trustee may take such action as may be appropriate to enforce
such payment or performance, including the institution and prosecution of
appropriate Proceedings. Any such action shall be without prejudice to any
right to claim a Default or Event of Default under this Indenture and any right
to proceed thereafter as provided in Article V.
SECTION 8.2. Trust Accounts and Payahead Account. (a) On or
prior to the Closing Date, the Issuer shall cause the Servicer to establish and
maintain the Trust Accounts and the Payahead Account as provided in Sections
4.1 and 4.7 of the Sale and Servicing Agreement.
(b) On or before each Distribution Date, the Servicer shall
deposit all Available Collections with respect to the Collection Period
preceding such Distribution Date in the Collection Account as provided in
Sections 4.2, 4.3, 4.4 and 4.5 of the Sale and Servicing Agreement. On or
before each Distribution Date, all amounts required to be withdrawn from the
Reserve Account and deposited in the Collection Account pursuant to Section 4.5
of the Sale and Servicing Agreement shall be withdrawn by the Indenture Trustee
from the Reserve Account and deposited to the Collection Account.
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(c) On each Distribution Date, the Indenture Trustee (based
on the information contained in the Servicer's Certificate delivered on or
before the related Determination Date pursuant to Section 3.9 of the Sale and
Servicing Agreement) shall make the following withdrawals from the Collection
Account and make deposits, distributions and payments, to the extent of funds
on deposit in the Collection Account with respect to the Collection Period
preceding such Distribution Date (including funds, if any, deposited therein
from the Reserve Account and the Payahead Account), in the following order of
priority:
(i) first, to the Servicer, the Servicing Fee and
all unpaid Servicing Fees from prior Collection Periods;
(ii) second, to the Noteholders of Class A Notes,
the Accrued Class A Note Interest; provided that if there are not
sufficient funds available to pay the entire amount of the Accrued
Class A Note Interest, the amounts available shall be applied to the
payment of such interest on the Class A Notes on a pro rata basis;
(iii) third, to the Principal Distribution Account,
the First Priority Principal Distribution Amount, if any;
(iv) fourth, to the Noteholders of Class B Notes,
the Accrued Class B Note Interest; provided that if there are not
sufficient funds available to pay the entire amount of the Accrued
Class B Note Interest, the amounts available shall be applied to the
payment of such interest on the Class B Notes on a pro rata basis;
(v) fifth, to the Principal Distribution Account,
the Second Priority Principal Distribution Amount, if any;
(vi) sixth, to the Certificate Interest Distribution
Account, the Accrued Class C Certificate Interest;
(vii) seventh, to the Certificate Interest
Distribution Account, the Accrued Class D Certificate Interest;
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(viii) eighth, to the Reserve Account, the amount,
if any, required to reinstate the amount in the Reserve Account up to
the Specified Reserve Balance;
(ix) ninth, to the Principal Distribution Account,
the Regular Principal Distribution Amount, if any; and
(x) tenth, to the Seller, any funds remaining on
deposit in the Collection Account with respect to the Collection
Period preceding such Distribution Date.
Notwithstanding the foregoing, (A) following the occurrence and during the
continuation of an Event of Default specified in Section 5.1(i) or (ii) of the
Indenture or an Insolvency Event with respect to the Issuer, in each case which
has resulted in an acceleration of the Notes, or following an Insolvency Event
or a dissolution with respect to the Seller or the General Partner, the
Servicer shall instruct the Indenture Trustee to transfer the funds on deposit
in the Collection Account remaining after the application of clauses (i) and
(ii) above to the Principal Distribution Account to the extent necessary to
reduce the principal amount of all the Notes to zero, (B) following the
occurrence and during the continuation of any other Event of Default, which has
resulted in an acceleration of the Notes, the Servicer shall instruct the
Indenture Trustee to transfer the funds on deposit in the Collection Account
remaining after the application of clauses (i), (ii), (iii) and (iv) above to
the Principal Distribution Account to the extent necessary to reduce the
principal amount of all the Notes to zero, and (C) in the case of an event
described in clause (A) or (B), the Certificateholders will not receive any
distributions of principal or interest until the principal amount and accrued
interest on all the Notes has been paid in full.
(d) On each Distribution Date, the Indenture Trustee (based
on the information contained in the Servicer's Certificate delivered on or
before the related Determination Date pursuant to Section 3.9 of the Sale and
Servicing Agreement) shall withdraw the funds on deposit in the Principal
Distribution Account with respect to the Collection Period preceding such
Distribution
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Date and make distributions and payments in the following order of priority:
(i) first, to the Noteholders of the Class A-1 Notes
in reduction of principal until the principal amount of the
outstanding Class A-1 Notes has been paid in full; provided that if
there are not sufficient funds available to pay the principal amount
of the outstanding Class A-1 Notes in full, the amounts available
shall be applied to the payment of principal on the Class A-1 Notes on
a pro rata basis;
(ii) second, to the Noteholders of the Class A-2
Notes in reduction of principal until the principal amount of the
outstanding Class A-2 Notes has been paid in full; provided that if
there are not sufficient funds available to pay the principal amount
of the outstanding Class A-2 Notes in full, the amounts available
shall be applied to the payment of principal on the Class A-2 Notes on
a pro rata basis;
(iii) third, to the Noteholders of the Class A-3
Notes in reduction of principal until the principal amount of the
outstanding Class A-3 Notes has been paid in full; provided that if
there are not sufficient funds available to pay the principal amount
of the outstanding Class A-3 Notes in full, the amounts available
shall be applied to the payment of principal on the Class A-3 Notes on
a pro rata basis;
(iv) fourth, to the Noteholders of the Class A-4
Notes in reduction of principal until the principal amount of the
outstanding Class A-4 Notes has been paid in full; provided that if
there are not sufficient funds available to pay the principal amount
of the outstanding Class A-4 Notes in full, the amounts available
shall be applied to the payment of principal on the Class A-4 Notes on
a pro rata basis;
(v) fifth, to the Noteholders of the Class B Notes in
reduction of principal until the principal amount of the outstanding
Class B Notes has been paid in full; provided that if there are
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not sufficient funds available to pay the principal amount of the
outstanding Class B Notes in full, the amounts available shall be
applied to the payment of principal on the Class B Notes on a pro rata
basis;
(vi) sixth, to the Certificate Principal Distribution
Account, in reduction of the Certificate Balance of the Class C
Certificates, until the Certificate Balance of the Class C
Certificates has been reduced to zero;
(vii) seventh, to the Certificate Principal
Distribution Account, in reduction of the Certificate Balance of the
Class D Certificates, until the Certificate Balance of the Class D
Certificates has been reduced to zero; and
(viii) eighth, to the Seller, any funds remaining on
deposit in the Principal Distribution Account.
SECTION 8.3. General Provisions Regarding Accounts. (a) So
long as no Default or Event of Default shall have occurred and be continuing,
all or a portion of the funds in the Collection Account, the Payahead Account
and the Reserve Account shall be invested by the Indenture Trustee at the
direction of the Servicer in Permitted Investments as provided in Sections 4.1
and 4.7 of the Sale and Servicing Agreement. All income or other gain (net of
losses and investment expenses) from investments of monies deposited in the
Collection Account, the Payahead Account and the Reserve Account shall be
withdrawn by the Indenture Trustee from such accounts (but only under the
circumstances set forth in the Sale and Servicing Agreement in the case of the
Reserve Account) and distributed as provided in Sections 4.1 and 4.7 of the
Sale and Servicing Agreement. The Servicer shall not direct the Indenture
Trustee to make any investment of any funds or to sell any investment held in
any of the Trust Accounts unless the security interest Granted and perfected in
such account will continue to be perfected in such investment or the proceeds
of such sale, in either case without any further action by any Person, and, in
connection with any direction to the Indenture Trustee to make any such
investment or sale, if requested by the Indenture
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Trustee, the Issuer shall deliver to the Indenture Trustee an Opinion of
Counsel, acceptable to the Indenture Trustee, to such effect.
(b) Subject to Section 6.1(c), the Indenture Trustee shall
not in any way be held liable by reason of any insufficiency in any of the
Trust Accounts or in the Payahead Account resulting from any loss on any
Permitted Investment included therein, except for losses attributable to the
Indenture Trustee's failure to make payments on such Permitted Investments
issued by the Indenture Trustee, in its commercial capacity as principal
obligor and not as trustee, in accordance with their terms.
(c) If (i) the Servicer shall have failed to give investment
directions for any funds on deposit in the Collection Account, the Payahead
Account or the Reserve Account to the Indenture Trustee by 11:00 a.m. New York
Time (or such other time as may be agreed by the Issuer and Indenture Trustee)
on the Business Day preceding each Distribution Date or (ii) to the knowledge
of a Trustee Officer of the Indenture Trustee, a Default or Event of Default
shall have occurred and be continuing with respect to the Notes but the Notes
shall not have been declared due and payable pursuant to Section 5.2 or (iii)
if such Notes shall have been declared due and payable following an Event of
Default, amounts collected or receivable from the Indenture Trust Estate are
being applied in accordance with Section 5.4 as if there had not been such a
declaration, then the Indenture Trustee shall, to the fullest extent
practicable, invest and reinvest funds in the Collection Account, the Payahead
Account or the Reserve Account, as the case may be, in one or more Permitted
Investments described in clause (b) of the definition thereof.
SECTION 8.4. Release of Indenture Trust Estate. (a) Subject
to the payment of its fees and expenses pursuant to Section 6.7, the Indenture
Trustee may, and when required by the provisions of this Indenture shall,
execute instruments to release property from the lien of this Indenture, or
convey the Indenture Trustee's interest in the same, in a manner and under
circumstances that are not inconsistent with the provisions of this Indenture.
No party relying upon an instrument executed by the Indenture Trustee as
provided
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in this Article VIII shall be bound to ascertain the Indenture Trustee's
authority, inquire into the satisfaction of any conditions precedent or see to
the application of any monies.
(b) The Indenture Trustee shall, at such time as there are no
Notes Outstanding and all sums due the Indenture Trustee pursuant to Section
6.7 have been paid in full, release any remaining portion of the Indenture
Trust Estate that secured the Notes from the lien of this Indenture and release
to the Issuer or any other Person entitled thereto any funds then on deposit in
the Trust Accounts. The Indenture Trustee shall release property from the lien
of this Indenture pursuant to this Section 8.4(b) only upon receipt of an
Issuer Request accompanied by an Officer's Certificate, an Opinion of Counsel
and (if required by the TIA) Independent Certificates in accordance with TIA
Sections 314(c) and 314(d)(1) meeting the applicable requirements of Section
11.1.
(c) Each Noteholder or Note Owner, by its acceptance of a
Note or, in the case of a Note Owner, a beneficial interest in a Note,
acknowledges that from time to time the Indenture Trustee shall release the
lien of this Indenture on any Receivable to be sold to (i) the Seller in
accordance with Section 2.3 of the Sale and Servicing Agreement and (ii) to the
Servicer in accordance with Section 3.7 of the Sale and Servicing Agreement.
SECTION 8.5. Opinion of Counsel. The Indenture Trustee shall
receive at least seven (7) days notice when requested by the Issuer to take any
action pursuant to Section 8.4(a), accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, except in connection
with any action contemplated by Section 8.4(c), as a condition to such action,
an Opinion of Counsel, in form and substance satisfactory to the Indenture
Trustee, stating the legal effect of any such action, outlining the steps
required to complete the same, and concluding that all conditions precedent to
the taking of such action have been complied with and such action will not
materially and adversely impair the security for the Notes or the rights of the
Noteholders in contravention of the provisions of this Indenture; provided,
however, that such Opinion of
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Counsel shall not be required to express an opinion as to the fair value of the
Indenture Trust Estate. Counsel rendering any such opinion may rely, without
independent investigation, on the accuracy and validity of any certificate or
other instrument delivered to the Indenture Trustee in connection with any such
action.
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ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1. Supplemental Indentures Without Consent of
Noteholders. (a) Without the consent of the Noteholders but with prior notice
to the Rating Agencies, the Issuer and the Indenture Trustee, when authorized
by an Issuer Order, at any time and from time to time, may enter into one or
more indentures supplemental hereto (which shall conform to the provisions of
the Trust Indenture Act as in force at the date of the execution thereof), in
form satisfactory to the Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any
property at any time subject to the lien of this Indenture, or
better to assure, convey and confirm unto the Indenture
Trustee any property subject or required to be subjected to
the lien of this Indenture, or to subject to the lien of this
Indenture additional property;
(ii) to evidence the succession, in compliance with
the applicable provisions hereof, of another Person to the
Issuer, and the assumption by any such successor of the
covenants of the Issuer herein and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the
benefit of the Noteholders, or to surrender any right or power
herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge
any property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement
any provision herein or in any supplemental indenture that may
be inconsistent with any other provision herein or in any
supplemental indenture or to make any other provisions with
respect to matters or questions arising under this Indenture
or under any
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supplemental indenture which shall not be inconsistent with
the provisions of the Indenture; provided that such action
shall not materially adversely affect the interests of the
Noteholders;
(vi) to evidence and provide for the acceptance of
the appointment hereunder by a successor trustee with respect
to the Notes and to add to or change any of the provisions of
this Indenture as shall be necessary to facilitate the
administration of the trusts hereunder by more than one
trustee, pursuant to the requirements of Article VI; or
(vii) to modify, eliminate or add to the provisions
of this Indenture to such extent as shall be necessary to
affect the qualification of this Indenture under the TIA or
under any similar federal statute hereafter enacted and to add
to this Indenture such other provisions as may be expressly
required by the TIA.
The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further
appropriate agreements and stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by
an Issuer Order, may, also without the consent of any of the Noteholders but
with prior notice to the Rating Agencies, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner (other than the modifications set forth in Section 9.2)
the rights of the Noteholders under this Indenture; provided, however, that (i)
such action shall not, as evidenced by an Opinion of Counsel, adversely affect
in any material respect the interests of any Noteholder, (ii) the Rating Agency
Condition shall have been satisfied with respect to such action and (iii) such
action shall not, as evidenced by an Opinion of Counsel, cause the Issuer to be
characterized for federal or any then Applicable Tax State income tax purposes
as an association taxable as a corporation or otherwise have any material
adverse impact on the federal
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or any then Applicable Tax State income taxation of any Notes Outstanding or
outstanding Certificates or any Noteholder or Certificateholder.
SECTION 9.2. Supplemental Indentures with Consent of
Noteholders. The Issuer and the Indenture Trustee, when authorized by an
Issuer Order, also may, with prior notice to the Rating Agencies and with the
consent of the Noteholders of Notes evidencing not less than a majority of the
principal amount of the Notes Outstanding, by Act of such Noteholders delivered
to the Issuer and the Indenture Trustee, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or modifying
in any manner the rights of the Noteholders under this Indenture; provided,
however, that (i) the Rating Agency Condition shall have been satisfied with
respect to such action and (ii) such action shall not, as evidenced by an
Opinion of Counsel, cause the Issuer to be characterized for federal or any
then Applicable Tax State income tax purposes as an association taxable as a
corporation or otherwise have any material adverse impact on the federal or any
then Applicable Tax State income taxation of any Notes Outstanding or
outstanding Certificates or any Noteholder or Certificateholder; and provided,
further, that no such supplemental indenture shall, without the consent of the
Noteholder of each Outstanding Note affected thereby:
(i) modify or alter provisions of this Section 9.2;
(ii) change the Final Scheduled Distribution Date or
the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof,
the interest rate thereon or the Redemption Price with respect
thereto, change the provisions of this Indenture relating to
the application of collections on, or the proceeds of the sale
of, the Indenture Trust Estate to payment of principal of or
interest on the Notes, or change any place of payment where,
or the coin or currency in which, any Note or the interest
thereon is payable, or impair the right to institute suit for
the enforcement of
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the provisions of this Indenture requiring the application of
funds available therefor, as provided in Article V, to the
payment of any such amount due on the Notes on or after the
respective due dates thereof (or, in the case of redemption,
on or after the Redemption Date);
(iii) reduce the percentage of the principal amount
of the Notes Outstanding, the consent of the Noteholders of
which is required for any such supplemental indenture, or the
consent of the Noteholders of which is required for any waiver
of compliance with certain provisions of this Indenture or
certain Defaults or Events of Default hereunder and their
consequences provided for in this Indenture;
(iv) modify or alter the provisions of the proviso to
the definition of the term "Outstanding";
(v) reduce the percentage of the principal amount of
the Notes Outstanding required to direct the Indenture Trustee
to sell or liquidate the Indenture Trust Estate pursuant to
Section 5.4 if the proceeds of such sale or liquidation would
be insufficient to pay the principal amount and accrued but
unpaid interest on the Notes and the Certificates;
(vi) modify any provision of this Indenture
specifying a percentage of the aggregate principal amount of
the Notes necessary to amend this Indenture or the other Basic
Documents except to increase any percentage specified herein
or to provide that certain additional provisions of this
Indenture or the other Basic Documents cannot be modified or
waived without the consent of the Noteholder of each
Outstanding Note affected thereby;
(vii) modify any of the provisions of this Indenture
in such manner as to affect the calculation of the amount of
any payment of interest or principal due on any Note on any
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Distribution Date (including the calculation of any of the
individual components of such calculation) or to affect the
rights of the Noteholders to the benefit of any provisions for
the mandatory redemption of the Notes contained herein; or
(viii) permit the creation of any lien ranking prior
to or on a parity with the lien of this Indenture with respect
to any part of the Indenture Trust Estate or, except as
otherwise permitted or contemplated herein, terminate the lien
of this Indenture on any such collateral at any time subject
hereto or deprive any Noteholder of the security provided by
the lien of this Indenture.
The Indenture Trustee may in its discretion or upon receipt of an Opinion of
Counsel determine whether or not any Notes would be affected by any
supplemental indenture and any such determination shall be conclusive upon the
Noteholders of all Notes, whether theretofore or thereafter authenticated and
delivered hereunder. The Indenture Trustee shall not be liable for any such
determination made in good faith.
It shall not be necessary for any Act of Noteholders under
this Section 9.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Promptly after the execution by the Issuer and the Indenture
Trustee of any supplemental indenture pursuant to this Section 9.2, the
Indenture Trustee shall mail to the Noteholders of the Notes to which such
amendment or supplemental indenture relates a notice setting forth in general
terms the substance of such supplemental indenture. Any failure of the
Indenture Trustee to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.
SECTION 9.3. Execution of Supplemental Indentures. In
executing, or permitting the additional trusts created by, any supplemental
indenture permitted by this Article IX or the modification thereby of the
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trusts created by this Indenture, the Indenture Trustee shall be entitled to
receive, and subject to Sections 6.1 and 6.2, shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture and that
all conditions precedent to the execution and delivery of such supplemental
indenture have been satisfied. The Indenture Trustee may, but shall not be
obligated to, enter into any such supplemental indenture that affects the
Indenture Trustee's own rights, duties, liabilities or immunities under this
Indenture or otherwise.
SECTION 9.4. Effect of Supplemental Indenture. Upon the
execution of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and shall be deemed to be modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective
rights, limitations of rights, obligations, duties, liabilities and immunities
under this Indenture of the Indenture Trustee, the Issuer and the Noteholders
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 9.5. Conformity with Trust Indenture Act. Every
amendment of this Indenture and every supplemental indenture executed pursuant
to this Article IX shall conform to the requirements of the Trust Indenture Act
as then in effect so long as this Indenture shall then be qualified under the
Trust Indenture Act.
SECTION 9.6. Reference in Notes to Supplemental Indentures.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article IX may, and if required by the Indenture
Trustee shall, bear a notation in form approved by the Indenture Trustee as to
any matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the
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Issuer, to any such supplemental indenture may be prepared and executed by the
Issuer and authenticated and delivered by the Indenture Trustee in exchange for
outstanding Notes.
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ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1. Redemption. (a) The Class A-4 Notes and the
Class B Notes are subject to redemption in whole, but not in part, at the
direction of the Servicer pursuant to Section 9.1 of the Sale and Servicing
Agreement, on any Distribution Date on which the Servicer exercises its option
to purchase the assets of the Issuer pursuant to such Section 9.1, and the
amount paid by the Servicer shall be treated as collections of Receivables and
applied to pay the unpaid principal amount of the Notes and the Aggregate
Certificate Balance of the Certificates plus accrued and unpaid interest
thereon. The Servicer or the Issuer shall furnish the Rating Agencies and the
Noteholders notice of such redemption. If the Class A-4 Notes and the Class B
Notes are to be redeemed pursuant to this Section 10.1(a), the Servicer or the
Issuer shall furnish notice of such election to the Indenture Trustee not later
than forty (40) days prior to the Redemption Date and the Issuer shall deposit
by 10:00 a.m. (New York City time) on the Redemption Date with the Indenture
Trustee in the Collection Account the Redemption Price of the Class A-4 Notes
and the Class B Notes to be redeemed, whereupon all such Class A-4 Notes and
Class B Notes shall be due and payable on the Redemption Date.
(b) In the event that the assets of the Issuer are sold
pursuant to Section 9.2 of the Trust Agreement, all amounts on deposit in the
Collection Account and the Principal Distribution Account shall be paid to the
Noteholders up to an amount equal to the unpaid principal amount of the Notes
and all accrued and unpaid interest thereon. If the amounts in the Collection
Account and the Principal Distribution Account are to be paid to Noteholders
pursuant to this Section 10.1(b), the Servicer or the Issuer shall, to the
extent practicable, furnish notice of such event to the Indenture Trustee not
later than forty (40) days prior to the Redemption Date, whereupon all such
amounts shall be payable on the Redemption Date.
SECTION 10.2. Form of Redemption Notice. Notice of
redemption under Section 10.1(a) shall be given by the Indenture Trustee by
first-class mail,
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postage prepaid, or by facsimile mailed or transmitted promptly following
receipt of notice from the Issuer or Servicer pursuant to Section 10.1(a), but
not later than thirty (30) days prior to the applicable Redemption Date, to
each Noteholder as of the close of business on the Record Date preceding the
applicable Redemption Date, at such Noteholder's address or facsimile number
appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the place where such Notes are to be
surrendered for payment of the Redemption Price (which
shall be the office or agency of the Issuer to be
maintained as provided in Section 3.2); and
(iv) that on the Redemption Date, the Redemption
Price will become due and payable upon each such Note and
that interest thereon shall cease to accrue for and after
said date.
Notice of redemption of the Notes shall be given by the Indenture Trustee in
the name and at the expense of the Issuer. Failure to give notice of
redemption, or any defect therein, to any Noteholder shall not impair or affect
the validity of the redemption of any other Note.
SECTION 10.3. Notes Payable on Redemption Date. The Notes to
be redeemed shall, following notice of redemption as required by Section 10.2
(in the case of redemption pursuant to Section 10.1(a)), shall on the
Redemption Date become due and payable at the Redemption Price and (unless the
Issuer shall default in the payment of the Redemption Price) no interest shall
accrue on the Redemption Price for any period after the date to which accrued
interest is calculated for purposes of calculating the Redemption Price.
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ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Compliance Certificates and Opinions, etc. (a)
Upon any application or request by the Issuer to the Indenture Trustee to take
any action under any provision of this Indenture, the Issuer shall furnish to
the Indenture Trustee (i) an Officer's Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with, (ii) an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if any, have been
complied with and (iii) (if required by the TIA) an Independent Certificate
from a firm of certified public accountants meeting the applicable requirements
of this Section 11.1, except that, in the case of any such application or
request as to which the furnishing of such documents is specifically required
by any provision of this Indenture, no additional certificate or opinion need
be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(A) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(B) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(C) a statement that, in the opinion of each such
signatory, such signatory has made such examination or investigation
as is necessary to enable such signatory to express an informed
opinion as to whether or not such covenant or condition has been
complied with; and
(D) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
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(b) (i) Prior to the deposit of any Collateral or other
property or securities with the Indenture Trustee that is to
be made the basis for the release of any property or
securities subject to the lien of this Indenture, the Issuer
shall, in addition to any obligation imposed in Section
11.1(a) or elsewhere in this Indenture, furnish to the
Indenture Trustee an Officer's Certificate certifying or
stating the opinion of each person signing such certificate as
to the fair value (within ninety (90) days of such deposit) to
the Issuer of the Collateral or other property or securities
to be so deposited.
(ii) Whenever the Issuer is required to furnish to
the Indenture Trustee an Officer's Certificate certifying or
stating the opinion of any signer thereof as to the matters
described in clause (i) above, the Issuer shall also deliver
to the Indenture Trustee an Independent Certificate as to the
same matters, if the fair value to the Issuer of the
securities to be so deposited and of all other such securities
made the basis of any such withdrawal or release since the
commencement of the then-current fiscal year of the Issuer, as
set forth in the certificates delivered pursuant to clause (i)
above and this clause (ii), is ten percent (10%) or more of
the principal amount of the Notes Outstanding, but such a
certificate need not be furnished with respect to any
securities so deposited, if the fair value thereof to the
Issuer as set forth in the related Officer's Certificate is
less than $25,000 or less than one percent (1%) of the
principal amount of the Notes Outstanding.
(iii) Whenever any property or securities are to be
released from the lien of this Indenture, the Issuer shall
also furnish to the Indenture Trustee an Officer's Certificate
certifying or stating the opinion of each person signing such
certificate as to the fair value (within ninety (90) days of
such release) of the property or securities proposed to be
released and stating that in the opinion
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of such person the proposed release will not impair the
security under this Indenture in contravention of the
provisions hereof.
(iv) Whenever the Issuer is required to furnish to
the Indenture Trustee an Officer's Certificate certifying or
stating the opinion of any signer thereof as to the matters
described in clause (iii) above, the Issuer shall also furnish
to the Indenture Trustee an Independent Certificate as to the
same matters if the fair value of the property or securities
and of all other property, other than property as contemplated
by clause (v) below or securities released from the lien of
this Indenture since the commencement of the then-current
calendar year, as set forth in the certificates required by
clause (iii) above and this clause (iv), equals ten percent
(10%) or more of the principal amount of the Notes
Outstanding, but such certificate need not be furnished in the
case of any release of property or securities if the fair
value thereof as set forth in the related Officer's
Certificate is less than $25,000 or less than one percent (1%)
of the principal amount of the Notes Outstanding.
(v) Notwithstanding Section 2.10 or any other
provisions of this Section 11.1, the Issuer may, without
compliance with the requirements of the other provisions of
this Section 11.1, (A) collect, liquidate, sell or otherwise
dispose of Receivables and Financed Vehicles as and to the
extent permitted or required by the Basic Documents and (B)
make cash payments out of the Trust Accounts and the Payahead
Account as and to the extent permitted or required by the
Basic Documents.
SECTION 11.2. Form of Documents Delivered to Indenture
Trustee. (a) In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such
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Person may certify or give an opinion with respect to some matters and one or
more other such Persons as to other matters, and any such Person may certify or
give an opinion as to such matters in one or several documents.
(b) Any certificate or opinion of an Authorized Officer of
the Issuer may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such officer
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to the matters upon which such
officer's certificate or opinion is based are erroneous. Any such certificate
of an Authorized Officer or opinion of counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Servicer, the Seller, the
Administrator or the Issuer, stating that the information with respect to such
factual matters is in the possession of the Servicer, the Seller, the
Administrator or the Issuer, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to such matters
are erroneous.
(c) Where any Person is required to make, give or execute two
or more applications, requests, comments, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
(d) Whenever in this Indenture, in connection with any
application or certificate or report to the Indenture Trustee, it is provided
that the Issuer shall deliver any document as a condition of the granting of
such application, or as evidence of the Issuer's compliance with any term
hereof, it is intended that the truth and accuracy, at the time of the granting
of such application or at the effective date of such certificate or report (as
the case may be), of the facts and opinions stated in such document shall in
such case be conditions precedent to the right of the Issuer to have such
application granted or to the sufficiency of such certificate or report. The
foregoing shall not, however, be construed to affect the Indenture Trustee's
right to rely upon the truth and accuracy of any statement or opinion contained
in any such document as provided in Article VI.
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SECTION 11.3. Acts of Noteholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except
as herein otherwise expressly provided such action shall become effective when
such instrument or instruments are delivered to the Indenture Trustee, and,
where it is hereby expressly required, to the Issuer. Such instrument or
instruments (and the action embodied herein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Noteholders signing such instrument
or instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Section 6.1) conclusive in favor of the Indenture Trustee and
the Issuer, if made in the manner provided in this Section 11.3.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any manner that the Indenture
Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note
Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Noteholder of any Notes shall bind the
Noteholder of every Note issued upon the registration thereof or in exchange
therefor or in lieu thereof, in respect of anything done, omitted or suffered
to be done by the Indenture Trustee or the Issuer in reliance thereon, whether
or not notation of such action is made upon such Note.
SECTION 11.4. Notices, etc., to Indenture Trustee, Issuer and
Rating Agencies. Any request, demand, authorization, direction, notice,
consent, waiver or Act of Noteholders or other documents provided or permitted
by this Indenture shall be in writing and if such request, demand,
authorization, direction, notice,
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consent, waiver or Act of Noteholders is to be made upon, given or furnished to
or filed with:
(i) the Indenture Trustee by any Noteholder, the
Servicer, the Administrator or the Issuer shall be sufficient
for every purpose hereunder if made, given, furnished or filed
in writing to or with the Indenture Trustee at its Corporate
Trust office; or
(ii) the Issuer by the Indenture Trustee or by any
Noteholder shall be sufficient for every purpose hereunder if
in writing and mailed first-class, postage prepaid to the
Issuer addressed to: Ford Credit Auto Owner Trust 1998-B, in
care of PNC Bank, Delaware, 000 Xxxxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, Attention: Xxxxxxx X. XxXxxxxx, with a copy
to the Administrator at Xxx Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx
00000, Attention: Secretary, or at any other address
previously furnished in writing to the Indenture Trustee by
the Issuer or the Administrator. The Issuer shall promptly
transmit any notice received by it from the Noteholders to the
Indenture Trustee.
Notices required to be given to the Rating Agencies by the
Issuer, the Indenture Trustee or the Owner Trustee shall be in writing,
personally delivered, telecopied or mailed by certified mail, return receipt
requested, to (i) in the case of Moody's, at the following address: Xxxxx'x
Investors Service, Inc., ABS Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, (ii) in case of Standard & Poor's, at the following address:
Standard & Poor's Ratings Services, 00 Xxxxxxxx (00xx Xxxxx), Xxx Xxxx, Xxx
Xxxx 00000, Attention: Asset Backed Surveillance Department and (iii) in the
case of Fitch, at the following address: Fitch IBCA, Inc., 0000 Xxxx 0xx
Xxxxxx, Xxxxxx, Xxxxxxx 00000, Attention: Asset Backed Surveillance.
SECTION 11.5. Notices to Noteholders; Waiver. (a) Where this
Indenture provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage
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prepaid to each Noteholder affected by such event, at his address as it appears
on the Note Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. In any case where
notice to Noteholders is given by mail, neither the failure to mail such notice
nor any defect in any notice so mailed to any particular Noteholder shall
affect the sufficiency of such notice with respect to other Noteholders, and
any notice that is mailed in the manner herein provided shall conclusively be
presumed to have been duly given.
(b) Where this Indenture provides for notice in any manner,
such notice may be waived in writing by any Person entitled to receive such
notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Noteholders shall be filed
with the Indenture Trustee but such filing shall not be a condition precedent
to the validity of any action taken in reliance upon such a waiver.
(c) In case, by reason of the suspension of regular mail
service as a result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event to Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Indenture Trustee
shall be deemed to be a sufficient giving of such notice.
(d) Where this Indenture provides for notice to the Rating
Agencies, failure to give such notice shall not affect any other rights or
obligations created hereunder, and shall not under any circumstance constitute
a Default or Event of Default.
SECTION 11.6. Alternate Payment and Notice Provisions.
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Noteholder providing
for a method of payment, or notice by the Indenture Trustee or any Note Paying
Agent to such Noteholder, that is different from the methods provided for in
this Indenture for such payments or notices. The Issuer shall furnish to the
Indenture Trustee a copy of each such agreement and the Indenture Trustee shall
cause
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payments to be made and notices to be given in accordance with such agreements.
SECTION 11.7. Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with another provision hereof
that is required or deemed to be included in this Indenture by any of the
provisions of the Trust Indenture Act, such required or deemed provision shall
control.
The provisions of TIA Sections 310 through 317 that impose
duties on any Person (including the provisions automatically deemed included
herein unless expressly excluded by this Indenture) are a part of and govern
this Indenture, whether or not physically contained herein.
SECTION 11.8. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 11.9. Successors and Assigns. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successors and assigns, whether so expressed or not. All agreements of the
Indenture Trustee in this Indenture shall bind its successors, co-trustees and
agents.
SECTION 11.10. Separability. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality, and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 11.11. Benefits of Indenture. Nothing in this
Indenture or in the Notes, express or implied, shall give to any Person, other
than the parties hereto and their successors hereunder, and the Noteholders,
and any other party secured hereunder, and any other Person with an ownership
interest in any part of the Indenture Trust Estate, any benefit or any legal or
equitable right, remedy or claim under this Indenture.
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SECTION 11.12. Legal Holidays. In any case where the date on
which any payment is due shall not be a Business Day, then (notwithstanding any
other provision of the Notes or this Indenture) payment need not be made on
such date, but may be made on the next succeeding Business Day with the same
force and effect as if made on the date on which nominally due, and no interest
shall accrue for the period from and after any such nominal date.
SECTION 11.13. Governing Law. This Indenture shall be
construed in accordance with the laws of the State of New York, without
reference to its conflict of law provisions.
SECTION 11.14. Counterparts. This Indenture may be executed
in any number of counterparts, each of which so executed shall be deemed to be
an original, but all such counterparts shall together constitute but one and
the same instrument.
SECTION 11.15. Recording of Indenture. If this Indenture is
subject to recording in any appropriate public recording offices, such
recording is to be effected by the Issuer and at its expense accompanied by an
Opinion of Counsel (which may be counsel to the Indenture Trustee or any other
counsel reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any
other Person secured hereunder or for the enforcement of any right or remedy
granted to the Indenture Trustee under this Indenture.
SECTION 11.16. Trust Obligation. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the
Owner Trustee or the Indenture Trustee on the Notes or under this Indenture or
any certificate or other writing delivered in connection herewith or therewith,
against (i) the Indenture Trustee or the Owner Trustee in their individual
capacities, (ii) any owner of a beneficial interest in the Issuer or (iii) any
partner, owner, beneficiary, agent, officer, director, employee or agent of the
Indenture Trustee or the
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Owner Trustee in their individual capacities, any holder of a beneficial
interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any
successor or assign of the Indenture Trustee or the Owner Trustee in their
individual capacities, except as any such Person may have expressly agreed (it
being understood that the Indenture Trustee and the Owner Trustee have no such
obligations in their individual capacities), and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
For all purposes of this Indenture, in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Article VI, VII and
VIII of the Trust Agreement.
SECTION 11.17. No Petition. The Indenture Trustee, by
entering into this Indenture, and each Noteholder or Note Owner, by accepting a
Note or, in the case of a Note Owner, a beneficial interest in a Note, hereby
covenant and agree that they will not at any time institute against the Seller,
the General Partner or the Issuer, or join in any institution against the
Seller, the General Partner or the Issuer of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any United States federal or State bankruptcy or similar law in connection with
any obligations relating to the Notes, this Indenture or any of the other Basic
Documents.
SECTION 11.18. Inspection. The Issuer agrees that, with
reasonable prior notice, it will permit any representative of the Indenture
Trustee, during the Issuer's normal business hours, to examine all the books of
account, records, reports and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by Independent certified
public accountants, and to discuss the Issuer's affairs, finances and accounts
with the Issuer's officers, employees, and Independent certified public
accountants, all at such reasonable times and as often as may be reasonably
requested. The Indenture Trustee shall and shall cause its representatives to
hold in confidence all such information except to the extent disclosure may be
required by law (and all reasonable applications for confidential treatment are
unavailing) and except to the extent that the Indenture Trustee may reasonably
determine that such disclosure is consistent with its obligations hereunder.
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IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have
caused this Indenture to be duly executed by their respective officers,
thereunto duly authorized and duly attested, all as of the day and year first
above written.
FORD CREDIT AUTO OWNER TRUST 1998-B
By: PNC BANK, DELAWARE,
not in its individual
capacity but solely as Owner
Trustee of Ford Credit Auto
Owner Trust 1998-B
By: /s/ Xxxxxxx X. XxXxxxxx
---------------------------
Name: Xxxxxxx X. XxXxxxxx
Title: Vice President
THE CHASE MANHATTAN BANK,
not in its individual
capacity but solely as
Indenture Trustee
By: /s/ Xxxxxxx X. Xxxxx
--------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
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EXHIBIT A-1
[FORM OF CLASS A-1 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $750,000,000
Xx. X-0 XXXXX XX. 00000XXX0
FORD CREDIT AUTO OWNER TRUST 1998-B
CLASS A-1 5.615% ASSET BACKED NOTES
Ford Credit Auto Owner Trust 1998-B, a business trust
organized and existing under the laws of the State of Delaware (herein referred
to as the "Issuer"), for value received, hereby promises to pay to CEDE & CO.,
or registered assigns, the principal sum of SEVEN HUNDRED FIFTY MILLION DOLLARS
payable on each Distribution Date in an amount equal to the result obtained by
multiplying (i) a fraction the numerator of which is $750,000,000 (the original
face amount of this Note) and the denominator of which is $750,000,000 by (ii)
the aggregate amount, if any, payable to Noteholders of Class A-1 Notes on such
Distribution Date from the Principal Distribution Account in respect of
principal on the Class A-1 Notes pursuant to Section 3.1 of the Indenture dated
as of May
X-0-0
000
0, 0000 (xx from time to time amended, supplemented or otherwise modified and
in effect, the "Indenture"), between the Issuer and The Chase Manhattan Bank, a
New York corporation, as Indenture Trustee (in such capacity the "Indenture
Trustee"); provided, however, that the entire unpaid principal amount of this
Note shall be due and payable on the May 1999 Distribution Date (the "Class A-1
Final Scheduled Distribution Date"). Capitalized terms used but not defined
herein are defined in Article I of the Indenture, which also contains rules as
to construction that shall be applicable herein.
The Issuer shall pay interest on this Note at the rate per
annum shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in Section 3.1 of the Indenture. Interest on
this Note will accrue for each Distribution Date from and including the
previous Distribution Date on which interest has been paid (or, in the case of
the initial Distribution Date, from the Closing Date) to but excluding such
Distribution Date. Interest will be computed on the basis of actual days
elapsed and a 360-day year. Such principal of and interest on this Note shall
be paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of this
Note.
Reference is made to the further provisions of this Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Note.
A-1-2
106
Unless the certificate of authentication hereon has been
executed by the Indenture Trustee whose name appears below by manual signature,
this Note shall not be entitled to any benefit under the Indenture referred to
on the reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
A-1-3
107
IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: May 28, 1998
FORD CREDIT AUTO OWNER TRUST 1998-B
By: PNC BANK, DELAWARE,
not in its individual capacity
but solely as Owner Trustee under
the Trust Agreement
By:
--------------------------
Authorized Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1 Notes designated above and referred to in the
within-mentioned Indenture.
Date: May 28, 1998
THE CHASE MANHATTAN BANK,
not in its individual capacity but
solely as Indenture Trustee
By:
---------------------------------
Authorized Officer
108
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class A-1 5.615% Asset Backed Notes (the "Class A-1
Notes") which, together with the Issuer's Class A-2 5.80% Asset Backed Notes
(the "Class A-2 Notes"), Class A-3 5.85% Asset Backed Notes (the "Class A-3
Notes"), Class A-4 5.90% Asset Backed Notes (the "Class A-4 Notes" and,
together with the Class A-1 Notes , the Class A-2 Notes and the Class A-3
Notes, the "Class A Notes") and Class B 6.15% Asset Backed Notes (the "Class B
Notes" and, together with the Class A Notes, the "Notes"), are issued under the
Indenture, to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations
thereunder of the Issuer, the Indenture Trustee and the Noteholders. The Notes
are subject to all terms of the Indenture.
The Class A-1 Notes are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture. The Class A-1 Notes are senior in right of payment to the Class A-2
Notes, the Class A-3 Notes, the Class A-4 Notes and the Class B Notes, each as
and to the extent provided in the Indenture.
Principal of the Class A-1 Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the fifteenth day of each month, or, if any such day is not a
Business Day, the next succeeding Business Day, commencing June 15, 1998.
As described on the face hereof, the entire unpaid principal
amount of this Note shall be due and payable on the Class A-1 Final Scheduled
Distribution Date. Notwithstanding the foregoing, the entire unpaid principal
amount of the Notes shall be due and payable on the date on which an Event of
Default shall have occurred and be continuing and the Indenture Trustee or the
Noteholders of Notes evidencing not less than a majority of the principal
amount of the Notes Outstanding have declared the Notes to be immediately due
and payable in the manner provided in Section 5.2 of the Indenture. All
A-1-5
109
principal payments on the Class A-1 Notes shall be made pro rata to the
Noteholders entitled thereto.
Payments of interest on this Note on each Distribution Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made to the Person whose name appears as the
Registered Noteholder of the Note (or one or more Predecessor Notes) on the
Note Register as of the close of business on each Record Date either by wire
transfer in immediately available funds, to the account of such Noteholder at a
bank or other entity having appropriate facilities therefor, if such Noteholder
shall have provided to the Note Registrar appropriate written instructions at
least five (5) Business Days prior to such Distribution Date and such
Noteholder's Notes in the aggregate evidence a denomination of not less than
$1,000,000, or, if not, by check mailed first-class postage prepaid to such
Person's address as it appears on the Note Register on such Record Date;
provided that, unless Definitive Notes have been issued to Note Owners, with
respect to Notes registered on the Record Date in the name of the nominee of
the Clearing Agency (initially, such nominee to be Cede & Co.), payments will
be made by wire transfer in immediately available funds to the account
designated by such nominee. Such payments will be made without requiring that
this Note be submitted for notation of payment. Any reduction in the principal
amount of this Note (or any one or more Predecessor Notes) effected by any
payments made on any Distribution Date shall be binding upon all future
Noteholders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted
hereon. If funds are expected to be available, as provided in the Indenture,
for payment in full of the then remaining unpaid principal amount of this Note
on a Distribution Date, then the Indenture Trustee, in the name of and on
behalf of the Issuer, will notify the Person who was the Registered Noteholder
hereof as of the Record Date preceding such Distribution Date by notice mailed
or transmitted by facsimile prior to such Distribution Date, and the amount
then due and payable shall be payable only upon presentation and surrender of
this Note at the Indenture Trustee's principal Corporate Trust Office or at the
office of the Indenture Trustee's agent appointed for such purposes located in
The City of New York.
A-1-6
110
The Issuer shall pay interest on overdue installments of
interest at the Class A-1 Rate to the extent lawful.
As provided in the Indenture, and subject to certain
limitations set forth therein, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Noteholder hereof
or such Noteholder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, and thereupon one or more new Notes of the same Class in
authorized denominations and in the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such
registration of transfer or exchange.
Each Noteholder or Note Owner, by its acceptance of a Note or,
in the case of a Note Owner, a beneficial interest in a Note, covenants and
agrees that no recourse may be taken, directly or indirectly, with respect to
the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on
the Notes or under the Indenture or any certificate or other writing delivered
in connection therewith, against (i) the Indenture Trustee or the Owner
Trustee, each in its individual capacity, (ii) any owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, agent,
officer, director or employee of the Indenture Trustee or the Owner Trustee,
each in its individual capacity, any holder of a beneficial interest in the
Issuer, the Owner Trustee or the Indenture Trustee or of any successor or
assign of the Indenture Trustee or the Owner Trustee, each in its individual
capacity, except as any such Person may have expressly agreed and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution for
A-1-7
111
stock, unpaid capital contribution or failure to pay any installment or call
owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the General Partner or the
Issuer, or join in any institution against the Seller, the General Partner or
the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under any United States federal or State bankruptcy or
similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is
issued with the intention that, for federal, State and local income, and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Indenture Trust Estate. Each Noteholder, by its acceptance of a
Note (and each Note Owner by its acceptance of a beneficial interest in a
Note), will be deemed to agree to treat the Notes for federal, State and local
income, single business and franchise tax purposes as indebtedness of the
Issuer.
Prior to the due presentment for registration of transfer of
this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the Indenture)
is registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Noteholders under the Indenture
at any time by the Issuer with the consent of the Noteholders of Notes
evidencing not less than a majority of the principal amount of the Notes
Outstanding. The Indenture also contains provisions permitting the Noteholders
of Notes evidencing specified percentages of the principal amount
A-1-8
112
of the Notes Outstanding, on behalf of all Noteholders, to waive compliance by
the Issuer with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Noteholder of this Note (or any one or more Predecessor Notes) shall be
conclusive and binding upon such Noteholder and upon all future Noteholders of
this Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent or
waiver is made upon this Note. The Indenture also permits the Indenture
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of the Noteholders.
The term "Issuer", as used in this Note, includes any
successor to the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the Indenture
Trustee and the Noteholders under the Indenture.
The Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
This Note and the Indenture shall be governed by, and
construed in accordance with the laws of the State of New York, without
reference to its conflicts of law provisions.
No reference herein to the Indenture, and no provision of this
Note or of the Indenture, shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and interest on
this Note at the times, place and rate, and in the coin or currency herein
prescribed.
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of The Chase Manhattan Bank, in
its individual capacity, PNC Bank, Delaware, in its individual capacity, any
owner of a beneficial interest in the Issuer, or any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors
or assigns shall be personally liable for, nor shall recourse be had
A-1-9
113
to any of them for, the payment of principal or of interest on this Note or
performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in the Indenture. The Noteholder of this Note, by
his acceptance hereof, agrees that, except as expressly provided in the Basic
Documents, in the case of an Event of Default under the Indenture, the
Noteholder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing contained herein shall
be taken to prevent recourse to, and enforcement against, the assets of the
Issuer for any and all liabilities, obligations and undertakings contained in
the Indenture or in this Note.
A-1-10
114
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
--------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _________________, attorney, to transfer said Note on the books
kept for registration thereof, with full power of substitution in the premises.
Dated: */
---------------------------- ----------------------------
Signature Guaranteed
*/
----------------------------
------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note Registrar.
A-1-11
115
EXHIBIT A-2
[FORM OF CLASS A-2 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $1,000,000,000
Xx. X-0 XXXXX XX. 00000XXX0
FORD CREDIT AUTO OWNER TRUST 1998-B
CLASS A-2 5.80% ASSET BACKED NOTES
Ford Credit Auto Owner Trust 1998-B, a business trust
organized and existing under the laws of the State of Delaware (herein referred
to as the "Issuer"), for value received, hereby promises to pay to CEDE & CO.,
or registered assigns, the principal sum of ONE BILLION DOLLARS payable on each
Distribution Date in an amount equal to the result obtained by multiplying (i)
a fraction the numerator of which is $1,000,000,000 (the original face amount
of this Note) and the denominator of which is $1,000,000,000 by (ii) the
aggregate amount, if any, payable to Noteholders of Class A-2 Notes on such
Distribution Date from the Principal Distribution Account in respect of
principal on the Class A-2 Notes pursuant to Section 3.1 of the Indenture dated
as of May 1, 1998
A-2-1
116
(as from time to time amended, supplemented or otherwise modified and in
effect, the "Indenture"), between the Issuer and The Chase Manhattan Bank, a
New York corporation, as Indenture Trustee (in such capacity the "Indenture
Trustee"); provided, however, that the entire unpaid principal amount of this
Note shall be due and payable on the October 2000 Distribution Date (the "Class
A-2 Final Scheduled Distribution Date"). Capitalized terms used but not
defined herein are defined in Article I of the Indenture, which also contains
rules as to construction that shall be applicable herein.
The Issuer shall pay interest on this Note at the rate per
annum shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in Section 3.1 of the Indenture. Interest on
this Note will accrue for each Distribution Date from and including the
fifteenth day of the calendar month immediately preceding such Distribution
Date (or, in the case of the initial Distribution Date, from the Closing Date)
to but excluding the fifteenth day of the following calendar month. Interest
will be computed on the basis of a 360-day year of twelve 30- day months. Such
principal of and interest on this Note shall be paid in the manner specified on
the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of this
Note.
Reference is made to the further provisions of this Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Note.
A-2-2
117
Unless the certificate of authentication hereon has been
executed by the Indenture Trustee whose name appears below by manual signature,
this Note shall not be entitled to any benefit under the Indenture referred to
on the reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
A-2-3
118
IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: May 28, 1998
FORD CREDIT AUTO OWNER TRUST 1998-B
By: PNC BANK, DELAWARE,
not in its individual capacity
but solely as Owner Trustee under
the Trust Agreement
By:
-------------------------
Authorized Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A-2 Notes designated above and referred to in the
within-mentioned Indenture.
Date: May 28, 1998
THE CHASE MANHATTAN BANK,
not in its individual capacity but
solely as Indenture Trustee
By:
----------------------------
Authorized Officer
119
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class A-2 5.80% Asset Backed Notes (the "Class A-2
Notes") which, together with the Issuer's Class A-1 5.615% Asset Backed Notes
(the "Class A-1 Notes"), Class A-3 5.85% Asset Backed Notes (the "Class A-3
Notes"), Class A-4 5.90% Asset Backed Notes (the "Class A-4 Notes" and,
together with the Class A-1 Notes, the Class A-2 Notes and the Class A-3 Notes,
the "Class A Notes") and Class B 6.15% Asset Backed Notes (the "Class B Notes"
and, together with the Class A Notes, the "Notes"), are issued under the
Indenture, to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations
thereunder of the Issuer, the Indenture Trustee and the Noteholders. The Notes
are subject to all terms of the Indenture.
The Class A-2 Notes are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture. The Class A-2 Notes are subordinated in right of payment to the
Class A-1 Notes and senior in right of payment to the Class A-3 Notes, the
Class A-4 Notes and the Class B Notes, each as and to the extent provided in
the Indenture.
Principal of the Class A-2 Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the fifteenth day of each month, or, if any such day is not a
Business Day, the next succeeding Business Day, commencing June 15, 1998.
As described on the face hereof, the entire unpaid principal
amount of this Note shall be due and payable on the Class A-2 Final Scheduled
Distribution Date. Notwithstanding the foregoing, the entire unpaid principal
amount of the Notes shall be due and payable on the date on which an Event of
Default shall have occurred and be continuing and the Indenture Trustee or the
Noteholders of Notes evidencing not less than a majority of the principal
amount of the Notes Outstanding have declared the Notes to be immediately due
and payable in the manner provided in Section 5.2 of the Indenture. All
A-2-5
120
principal payments on the Class A-2 Notes shall be made pro rata to the
Noteholders entitled thereto.
Payments of interest on this Note on each Distribution Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made to the Person whose name appears as the
Registered Noteholder of the Note (or one or more Predecessor Notes) on the
Note Register as of the close of business on each Record Date either by wire
transfer in immediately available funds, to the account of such Noteholder at a
bank or other entity having appropriate facilities therefor, if such Noteholder
shall have provided to the Note Registrar appropriate written instructions at
least five (5) Business Days prior to such Distribution Date and such
Noteholder's Notes in the aggregate evidence a denomination of not less than
$1,000,000, or, if not, by check mailed first-class postage prepaid to such
Person's address as it appears on the Note Register on such Record Date;
provided that, unless Definitive Notes have been issued to Note Owners, with
respect to Notes registered on the Record Date in the name of the nominee of
the Clearing Agency (initially, such nominee to be Cede & Co.), payments will
be made by wire transfer in immediately available funds to the account
designated by such nominee. Such payment will be made without requiring that
this Note be submitted for notation of payment. Any reduction in the principal
amount of this Note (or any one or more Predecessor Notes) effected by any
payments made on any Distribution Date shall be binding upon all future
Noteholders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted
hereon. If funds are expected to be available, as provided in the Indenture,
for payment in full of the then remaining unpaid principal amount of this Note
on a Distribution Date, then the Indenture Trustee, in the name of and on
behalf of the Issuer, will notify the Person who was the Registered Noteholder
hereof as of the Record Date preceding such Distribution Date by notice mailed
or transmitted by facsimile prior to such Distribution Date, and the amount
then due and payable shall be payable only upon presentation and surrender of
this Note at the Indenture Trustee's principal Corporate Trust Office or at the
office of the Indenture Trustee's agent appointed for such purposes located in
The City of New York.
A-2-6
121
The Issuer shall pay interest on overdue installments of
interest at the Class A-2 Rate to the extent lawful.
As provided in the Indenture, and subject to certain
limitations set forth therein, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Noteholder hereof
or such Noteholder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, and thereupon one or more new Notes of the same Class in
authorized denominations and in the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such
registration of transfer or exchange.
Each Noteholder or Note Owner, by its acceptance of a Note or,
in the case of a Note Owner, a beneficial interest in a Note, covenants and
agrees that no recourse may be taken, directly or indirectly, with respect to
the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on
the Notes or under the Indenture or any certificate or other writing delivered
in connection therewith, against (i) the Indenture Trustee or the Owner
Trustee, each in its individual capacity, (ii) any owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, agent,
officer, director or employee of the Indenture Trustee or the Owner Trustee,
each in its individual capacity, any holder of a beneficial interest in the
Issuer, the Owner Trustee or the Indenture Trustee or of any successor or
assign of the Indenture Trustee or the Owner Trustee, each in its individual
capacity, except as any such Person may have expressly agreed and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution for
A-2-7
122
stock, unpaid capital contribution or failure to pay any installment or call
owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the General Partner or the
Issuer, or join in any institution against the Seller, the General Partner or
the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under any United States federal or State bankruptcy or
similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is
issued with the intention that, for federal, State and local income, and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Indenture Trust Estate. Each Noteholder, by its acceptance of a
Note (and each Note Owner by its acceptance of a beneficial interest in a
Note), will be deemed to agree to treat the Notes for federal, State and local
income, single business and franchise tax purposes as indebtedness of the
Issuer.
Prior to the due presentment for registration of transfer of
this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the Indenture)
is registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Noteholders under the Indenture
at any time by the Issuer with the consent of the Noteholders of Notes
evidencing not less than a majority of the principal amount of the Notes
Outstanding. The Indenture also contains provisions permitting the Noteholders
of Notes evidencing specified percentages of the principal amount
A-2-8
123
of the Notes Outstanding, on behalf of all Noteholders, to waive compliance by
the Issuer with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Noteholder of this Note (or any one or more Predecessor Notes) shall be
conclusive and binding upon such Noteholder and upon all future Noteholders of
this Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent or
waiver is made upon this Note. The Indenture also permits the Indenture
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of the Noteholders.
The term "Issuer", as used in this Note, includes any
successor to the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the Indenture
Trustee and the Noteholders under the Indenture.
The Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
This Note and the Indenture shall be governed by, and
construed in accordance with the laws of the State of New York, without
reference to its conflicts of law provisions.
No reference herein to the Indenture, and no provision of this
Note or of the Indenture, shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and interest on
this Note at the times, place and rate, and in the coin or currency herein
prescribed.
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of The Chase Manhattan Bank, in
its individual capacity, PNC Bank, Delaware, in its individual capacity, any
owner of a beneficial interest in the Issuer, or any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors
or assigns shall be personally liable for, nor shall recourse be had
A-2-9
124
to any of them for, the payment of principal or of interest on this Note or
performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in the Indenture. The Noteholder of this Note, by
his acceptance hereof, agrees that, except as expressly provided in the Basic
Documents, in the case of an Event of Default under the Indenture, the
Noteholder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing contained herein shall
be taken to prevent recourse to, and enforcement against, the assets of the
Issuer for any and all liabilities, obligations and undertakings contained in
the Indenture or in this Note.
A-2-10
125
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
-----------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
--------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _________________, attorney, to transfer said Note on the books
kept for registration thereof, with full power of substitution in the premises.
Dated: */
-------------------------------- --------------------------
Signature Guaranteed
*/
--------------------------
-----------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note Registrar.
A-2-11
126
EXHIBIT A-3
[FORM OF CLASS A-3 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $785,000,000
No. R-1 CUSIP NO. 00000XXX0
FORD CREDIT AUTO OWNER TRUST 1998-B
CLASS A-3 5.85% ASSET BACKED NOTES
Ford Credit Auto Owner Trust 1998-B, a business trust
organized and existing under the laws of the State of Delaware (herein referred
to as the "Issuer"), for value received, hereby promises to pay to CEDE & CO.,
or registered assigns, the principal sum of SEVEN HUNDRED AND EIGHTY FIVE
MILLION DOLLARS payable on each Distribution Date in an amount equal to the
result obtained by multiplying (i) a fraction the numerator of which is
$785,000,000 (the original face amount of this Note) and the denominator of
which is $785,000,000 by (ii) the aggregate amount, if any, payable to
Noteholders of Class A-3 Notes on such Distribution Date from the Principal
Distribution Account in respect of principal on the Class A-3 Notes pursuant to
Section 3.1 of the Indenture dated
A-3-1
127
as of May 1, 1998 (as from time to time amended, supplemented or otherwise
modified and in effect, the "Indenture"), between the Issuer and The Chase
Manhattan Bank, a New York corporation, as Indenture Trustee (in such capacity
the "Indenture Trustee"); provided, however, that the entire unpaid principal
amount of this Note shall be due and payable on the October 2001 Distribution
Date (the "Class A-3 Final Scheduled Distribution Date"). Capitalized terms
used but not defined herein are defined in Article I of the Indenture, which
also contains rules as to construction that shall be applicable herein.
The Issuer shall pay interest on this Note at the rate per
annum shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in Section 3.1 of the Indenture. Interest on
this Note will accrue for each Distribution Date from and including the
fifteenth day of the calendar month immediately preceding such Distribution
Date (or, in the case of the initial Distribution Date, from the Closing Date)
to but excluding the fifteenth day of the following calendar month. Interest
will be computed on the basis of a 360-day year of twelve 30- day months. Such
principal of and interest on this Note shall be paid in the manner specified on
the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of this
Note.
Reference is made to the further provisions of this Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Note.
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Unless the certificate of authentication hereon has been
executed by the Indenture Trustee whose name appears below by manual signature,
this Note shall not be entitled to any benefit under the Indenture referred to
on the reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
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129
IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: May 28, 1998
FORD CREDIT AUTO OWNER TRUST 1998-B
By: PNC BANK, DELAWARE,
not in its individual
capacity but solely as Owner
Trustee under the Trust Agreement
By:
-----------------------
Authorized Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A-3 Notes designated above and referred to in the
within-mentioned Indenture.
Date: May 28, 1998
THE CHASE MANHATTAN BANK,
not in its individual capacity but
solely as Indenture Trustee
By:
----------------------------
Authorized Officer
130
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class A-3 5.85% Asset Backed Notes (the "Class A-3
Notes") which, together with the Issuer's Class A-1 5.615% Asset Backed Notes
(the "Class A-1 Notes"), Class A-2 5.80% Asset Backed Notes (the "Class A-2
Notes"), Class A-4 5.90% Asset Backed Notes (the "Class A-4 Notes" and,
together with the Class A-1 Notes, the Class A-2 Notes and the Class A-3 Notes,
the "Class A Notes") and Class B 6.15% Asset Backed Notes (the "Class B Notes"
and, together with the Class A Notes, the "Notes"), are issued under the
Indenture, to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations
thereunder of the Issuer, the Indenture Trustee and the Noteholders. The Notes
are subject to all terms of the Indenture.
The Class A-3 Notes are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture. The Class A-3 Notes are subordinated in right of payment to the
Class A-1 Notes and the Class A-2 Notes and are senior in right of payment to
the Class A-4 Notes and the Class B Notes, each as and to the extent provided
in the Indenture.
Principal of the Class A-3 Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the fifteenth day of each month, or, if any such day is not a
Business Day, the next succeeding Business Day, commencing June 15, 1998.
As described on the face hereof, the entire unpaid principal
amount of this Note shall be due and payable on the Class A-3 Final Scheduled
Distribution Date. Notwithstanding the foregoing, the entire unpaid principal
amount of the Notes shall be due and payable on the date on which an Event of
Default shall have occurred and be continuing and the Indenture Trustee or the
Noteholders of Notes evidencing not less than a majority of the principal
amount of the Notes Outstanding have declared the Notes to be immediately due
and payable in the manner provided in Section 5.2 of the Indenture. All
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131
principal payments on the Class A-3 Notes shall be made pro rata to the
Noteholders entitled thereto.
Payments of interest on this Note on each Distribution Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made to the Person whose name appears as the
Registered Noteholder of the Note (or one or more Predecessor Notes) on the
Note Register as of the close of business on each Record Date either by wire
transfer in immediately available funds, to the account of such Noteholder at a
bank or other entity having appropriate facilities therefor, if such Noteholder
shall have provided to the Note Registrar appropriate written instructions at
least five (5) Business Days prior to such Distribution Date and such
Noteholder's Notes in the aggregate evidence a denomination of not less than
$1,000,000, or, if not, by check mailed first-class postage prepaid to such
Person's address as it appears on the Note Register on such Record Date;
provided that, unless Definitive Notes have been issued to Note Owners, with
respect to Notes registered on the Record Date in the name of the nominee of
the Clearing Agency (initially, such nominee to be Cede & Co.), payments will
be made by wire transfer in immediately available funds to the account
designated by such nominee. Such payments will be made without requiring that
this Note be submitted for notation of payment. Any reduction in the principal
amount of this Note (or any one or more Predecessor Notes) effected by any
payments made on any Distribution Date shall be binding upon all future
Noteholders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted
hereon. If funds are expected to be available, as provided in the Indenture,
for payment in full of the then remaining unpaid principal amount of this Note
on a Distribution Date, then the Indenture Trustee, in the name of and on
behalf of the Issuer, will notify the Person who was the Registered Noteholder
hereof as of the Record Date preceding such Distribution Date by notice mailed
or transmitted by facsimile prior to such Distribution Date, and the amount
then due and payable shall be payable only upon presentation and surrender of
this Note at the Indenture Trustee's principal Corporate Trust Office or at the
office of the Indenture Trustee's agent appointed for such purposes located in
The City of New York.
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132
The Issuer shall pay interest on overdue installments of
interest at the Class A-3 Rate to the extent lawful.
As provided in the Indenture, and subject to certain
limitations set forth therein, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Noteholder hereof
or such Noteholder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, and thereupon one or more new Notes of the same Class in
authorized denominations and in the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such
registration of transfer or exchange.
Each Noteholder or Note Owner, by its acceptance of a Note or,
in the case of a Note Owner, a beneficial interest in a Note, covenants and
agrees that no recourse may be taken, directly or indirectly, with respect to
the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on
the Notes or under the Indenture or any certificate or other writing delivered
in connection therewith, against (i) the Indenture Trustee or the Owner
Trustee, each in its individual capacity, (ii) any owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, agent,
officer, director or employee of the Indenture Trustee or the Owner Trustee,
each in its individual capacity, any holder of a beneficial interest in the
Issuer, the Owner Trustee or the Indenture Trustee or of any successor or
assign of the Indenture Trustee or the Owner Trustee, each in its individual
capacity, except as any such Person may have expressly agreed and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution for
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133
stock, unpaid capital contribution or failure to pay any installment or call
owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the General Partner or the
Issuer, or join in any institution against the Seller, the General Partner or
the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under any United States federal or State bankruptcy or
similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is
issued with the intention that, for federal, State and local income, and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Indenture Trust Estate. Each Noteholder, by its acceptance of a
Note (and each Note Owner by its acceptance of a beneficial interest in a
Note), will be deemed to agree to treat the Notes for federal, State and local
income, single business and franchise tax purposes as indebtedness of the
Issuer.
Prior to the due presentment for registration of transfer of
this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the Indenture)
is registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Noteholders under the Indenture
at any time by the Issuer with the consent of the Noteholders of Notes
evidencing not less than a majority of the principal amount of the Notes
Outstanding. The Indenture also contains provisions permitting the Noteholders
of Notes evidencing specified percentages of the principal amount
A-3-8
134
of the Notes Outstanding, on behalf of all Noteholders, to waive compliance by
the Issuer with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Noteholder of this Note (or any one or more Predecessor Notes) shall be
conclusive and binding upon such Noteholder and upon all future Noteholders of
this Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent or
waiver is made upon this Note. The Indenture also permits the Indenture
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of the Noteholders.
The term "Issuer", as used in this Note, includes any
successor to the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the Indenture
Trustee and the Noteholders under the Indenture.
The Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
This Note and the Indenture shall be governed by, and
construed in accordance with the laws of the State of New York, without
reference to its conflicts of law provisions.
No reference herein to the Indenture, and no provision of this
Note or of the Indenture, shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and interest on
this Note at the times, place and rate, and in the coin or currency herein
prescribed.
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of The Chase Manhattan Bank, in
its individual capacity, PNC Bank, Delaware, in its individual capacity, any
owner of a beneficial interest in the Issuer, or any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors
or assigns shall be personally liable for, nor shall recourse be had
A-3-9
135
to any of them for, the payment of principal or of interest on this Note or
performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in the Indenture. The Noteholder of this Note, by
his acceptance hereof, agrees that, except as expressly provided in the Basic
Documents, in the case of an Event of Default under the Indenture, the
Noteholder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing contained herein shall
be taken to prevent recourse to, and enforcement against, the assets of the
Issuer for any and all liabilities, obligations and undertakings contained in
the Indenture or in this Note.
A-3-10
136
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
---------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
--------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _________________, attorney, to transfer said Note on the books
kept for registration thereof, with full power of substitution in the premises.
Dated: */
-------------------------------- --------------------------
Signature Guaranteed
*/
--------------------------
-----------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note Registrar.
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137
EXHIBIT A-4
[FORM OF CLASS A-4 NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $300,000,000
No. R-1 CUSIP NO. 00000XXX0
FORD CREDIT AUTO OWNER TRUST 1998-B
CLASS A-4 5.90% ASSET BACKED NOTES
Ford Credit Auto Owner Trust 1998-B, a business trust
organized and existing under the laws of the State of Delaware (herein referred
to as the "Issuer"), for value received, hereby promises to pay to CEDE & CO.,
or registered assigns, the principal sum of THREE HUNDRED MILLION DOLLARS
payable on each Distribution Date in an amount equal to the result obtained by
multiplying (i) a fraction the numerator of which is $300,000,000 (the original
face amount of this Note) and the denominator of which is $300,000,000 by (ii)
the aggregate amount, if any, payable to Noteholders of Class A-4 Notes on such
Distribution Date from the Principal Distribution Account in respect of
principal on the Class A-4 Notes pursuant to Section 3.1 of the Indenture dated
as of February 1,
A-4-1
138
1998 (as from time to time amended, supplemented or otherwise modified and in
effect, the "Indenture"), between the Issuer and The Chase Manhattan Bank, a
New York corporation, as Indenture Trustee (in such capacity the "Indenture
Trustee"); provided, however, that the entire unpaid principal amount of this
Note shall be due and payable on the earlier of the June 2002 Distribution Date
(the "Class A-4 Final Scheduled Distribution Date") and the Redemption Date, if
any, pursuant to Section 10.1(a) of the Indenture. Capitalized terms used but
not defined herein are defined in Article I of the Indenture, which also
contains rules as to construction that shall be applicable herein.
The Issuer shall pay interest on this Note at the rate per
annum shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in Section 3.1 of the Indenture. Interest on
this Note will accrue for each Distribution Date from and including the
fifteenth day of the calendar month immediately preceding such Distribution
Date (or, in the case of the initial Distribution Date, from the Closing Date)
to but excluding the fifteenth day of the following calendar month. Interest
will be computed on the basis of a 360-day year of twelve 30- day months. Such
principal of and interest on this Note shall be paid in the manner specified on
the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of this
Note.
Reference is made to the further provisions of this Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Note.
A-4-2
139
Unless the certificate of authentication hereon has been
executed by the Indenture Trustee whose name appears below by manual signature,
this Note shall not be entitled to any benefit under the Indenture referred to
on the reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
A-4-3
140
IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: May 28, 1998
FORD CREDIT AUTO OWNER TRUST 1998-B
By: PNC BANK, DELAWARE,
not in its individual
capacity but solely as
Owner Trustee under the
Trust Agreement
By:
--------------------------
Authorized Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A-4 Notes designated above and referred to in the
within-mentioned Indenture.
Date: May 28, 1998
THE CHASE MANHATTAN BANK,
not in its individual capacity
but solely as Indenture Trustee
By:
--------------------------------
Authorized Officer
141
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class A-4 5.90% Asset Backed Notes (the "Class A-4
Notes") which, together with the Issuer's Class A-1 5.615% Asset Backed Notes
(the "Class A-1 Notes"), Class A-2 5.80% Asset Backed Notes (the "Class A-2
Notes"), Class A-3 5.85% Asset Backed Notes (the "Class A-3 Notes" and,
together with the Class A-1 Notes, the Class A-2 Notes and the Class A-4 Notes,
the "Class A Notes") and Class B 6.15% Asset Backed Notes (the "Class B Notes"
and, together with the Class A Notes, the "Notes"), are issued under the
Indenture, to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations
thereunder of the Issuer, the Indenture Trustee and the Noteholders. The Notes
are subject to all terms of the Indenture.
The Class A-4 Notes are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture. The Class A-4 Notes are subordinated in right of payment to the
Class A-1 Notes, the Class A-2 Notes and the Class A-3 Notes and are senior in
right of payment to the Class B Notes, each as and to the extent provided in
the Indenture.
Principal of the Class A-4 Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the fifteenth day of each month, or, if any such day is not a
Business Day, the next succeeding Business Day, commencing June 15, 1998.
As described on the face hereof, the entire unpaid principal
amount of this Note shall be due and payable on the earlier of the Class A-4
Final Scheduled Distribution Date and the Redemption Date, if any, pursuant to
Section 10.1(a) of the Indenture. Notwithstanding the foregoing, the entire
unpaid principal amount of the Notes shall be due and payable on the date on
which an Event of Default shall have occurred and be continuing and the
Indenture Trustee or the Noteholders of Notes evidencing not less than a
majority of the principal amount of the Notes Outstanding have declared the
Notes to be immediately due and payable in the manner provided
A-4-5
142
in Section 5.2 of the Indenture. All principal payments on the Class A-4 Notes
shall be made pro rata to the Noteholders entitled thereto.
Payments of interest on this Note on each Distribution Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made to the Person whose name appears as the
Registered Noteholder of the Note (or one or more Predecessor Notes) on the
Note Register as of the close of business on each Record Date either by wire
transfer in immediately available funds, to the account of such Noteholder at a
bank or other entity having appropriate facilities therefor, if such Noteholder
shall have provided to the Note Registrar appropriate written instructions at
least five (5) Business Days prior to such Distribution Date and such
Noteholder's Notes in the aggregate evidence a denomination of not less than
$1,000,000, or, if not, by check mailed first-class postage prepaid to such
Person's address as it appears on the Note Register on such Record Date;
provided that, unless Definitive Notes have been issued to Note Owners, with
respect to Notes registered on the Record Date in the name of the nominee of
the Clearing Agency (initially, such nominee to be Cede & Co.), payments will
be made by wire transfer in immediately available funds to the account
designated by such nominee. Such payments will be made without requiring that
this Note be submitted for notation of payment. Any reduction in the principal
amount of this Note (or any one or more Predecessor Notes) effected by any
payments made on any Distribution Date shall be binding upon all future
Noteholders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted
hereon. If funds are expected to be available, as provided in the Indenture,
for payment in full of the then remaining unpaid principal amount of this Note
on a Distribution Date, then the Indenture Trustee, in the name of and on
behalf of the Issuer, will notify the Person who was the Registered Noteholder
hereof as of the Record Date preceding such Distribution Date by notice mailed
or transmitted by facsimile prior to such Distribution Date, and the amount
then due and payable shall be payable only upon presentation and surrender of
this Note at the Indenture Trustee's principal Corporate Trust Office or at the
office of the
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143
Indenture Trustee's agent appointed for such purposes located in The City of
New York.
The Issuer shall pay interest on overdue installments of
interest at the Class A-4 Rate to the extent lawful.
As provided in the Indenture, the Class A-4 Notes and the
Class B Notes may be redeemed, in whole but not in part, in the manner and to
the extent described in the Indenture and the Sale and Servicing Agreement.
The transfer of this Note is subject to the restrictions on
transfer specified on the face hereof and to the other limitations set forth in
the Indenture. Subject to the satisfaction of such restrictions and
limitations, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or
agency designated by the Issuer pursuant to the Indenture, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Indenture Trustee duly executed by, the Noteholder hereof or such Noteholder's
attorney duly authorized in writing, with such signature guaranteed by an
"eligible guarantor institution" meeting the requirements of the Note
Registrar, and thereupon one or more new Notes of the same Class in authorized
denominations and in the same aggregate principal amount will be issued to the
designated transferee or transferees. No service charge will be charged for
any registration of transfer or exchange of this Note, but the transferor may
be required to pay a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any such registration of transfer
or exchange.
Each Noteholder or Note Owner, by its acceptance of a Note or,
in the case of a Note Owner, a beneficial interest in a Note, covenants and
agrees that no recourse may be taken, directly or indirectly, with respect to
the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on
the Notes or under the Indenture or any certificate or other writing delivered
in connection therewith, against (i) the Indenture Trustee or the Owner
Trustee, each in its individual capacity, (ii) any owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, agent,
A-4-7
144
officer, director or employee of the Indenture Trustee or the Owner Trustee,
each in its individual capacity, any holder of a beneficial interest in the
Issuer, the Owner Trustee or the Indenture Trustee or of any successor or
assign of the Indenture Trustee or the Owner Trustee, each in its individual
capacity, except as any such Person may have expressly agreed and except that
any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution for stock, unpaid capital contribution or failure to pay
any installment or call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the General Partner or the
Issuer, or join in any institution against the Seller, the General Partner or
the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under any United States federal or State bankruptcy or
similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is
issued with the intention that, for federal, State and local income, and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Indenture Trust Estate. Each Noteholder, by its acceptance of a
Note (and each Note Owner by its acceptance of a beneficial interest in a
Note), will be deemed to agree to treat the Notes for federal, State and local
income, single business and franchise tax purposes as indebtedness of the
Issuer.
Prior to the due presentment for registration of transfer of
this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the Indenture)
is registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.
A-4-8
145
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Noteholders under the Indenture
at any time by the Issuer with the consent of the Noteholders of Notes
evidencing not less than a majority of the principal amount of the Notes
Outstanding. The Indenture also contains provisions permitting the Noteholders
of Notes evidencing specified percentages of the principal amount of the Notes
Outstanding, on behalf of all Noteholders, to waive compliance by the Issuer
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Noteholder
of this Note (or any one or more Predecessor Notes) shall be conclusive and
binding upon such Noteholder and upon all future Noteholders of this Note and
of any Note issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof whether or not notation of such consent or waiver is
made upon this Note. The Indenture also permits the Indenture Trustee to amend
or waive certain terms and conditions set forth in the Indenture without the
consent of the Noteholders.
The term "Issuer", as used in this Note, includes any
successor to the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the Indenture
Trustee and the Noteholders under the Indenture.
The Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
This Note and the Indenture shall be governed by, and
construed in accordance with the laws of the State of New York, without
reference to its conflicts of law provisions.
No reference herein to the Indenture, and no provision of this
Note or of the Indenture, shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and interest on
this Note at the times, place and rate, and in the coin or currency herein
prescribed.
A-4-9
146
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of The Chase Manhattan Bank, in
its individual capacity, PNC Bank, Delaware, in its individual capacity, any
owner of a beneficial interest in the Issuer, or any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors
or assigns shall be personally liable for, nor shall recourse be had to any of
them for, the payment of principal or of interest on this Note or performance
of, or omission to perform, any of the covenants, obligations or
indemnifications contained in the Indenture. The Noteholder of this Note, by
his acceptance hereof, agrees that, except as expressly provided in the Basic
Documents, in the case of an Event of Default under the Indenture, the
Noteholder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing contained herein shall
be taken to prevent recourse to, and enforcement against, the assets of the
Issuer for any and all liabilities, obligations and undertakings contained in
the Indenture or in this Note.
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ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
----------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
--------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _________________, attorney, to transfer said Note on the books
kept for registration thereof, with full power of substitution in the premises.
Dated: */
-------------------------------- --------------------------
Signature Guaranteed
*/
--------------------------
-----------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note Registrar.
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EXHIBIT A-5
[FORM OF CLASS B NOTE]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
REGISTERED $________________
No. R-_ CUSIP NO. 00000XXX0
FORD CREDIT AUTO OWNER TRUST 1998-B
CLASS B 6.15% ASSET BACKED NOTES
Ford Credit Auto Owner Trust 1998-B, a business trust
organized and existing under the laws of the State of Delaware (herein referred
to as the "Issuer"), for value received, hereby promises to pay to
____________, or registered assigns, the principal sum of ___________ DOLLARS
payable on each Distribution Date in an amount equal to the result obtained by
multiplying (i) a fraction the numerator of which is $__________ (the original
face amount of this Note) and the denominator of which is $105,000,000 by (ii)
the aggregate amount, if any, payable to Noteholders of Class B Notes on such
Distribution Date from the Principal Distribution Account in respect of
principal on the Class B Notes pursuant to Section 3.1 of the Indenture dated
as of May 1, 1998 (as from time to time amended, supplemented or otherwise
modified and in effect, the "Indenture"), between the Issuer and The Chase
Manhattan Bank, a New York corporation, as Indenture Trustee (in such capacity
the "Indenture Trustee"); provided, however, that the entire unpaid principal
amount of this Note shall be due and payable on the earlier of the September
2002 Distribution Date (the "Class B Final Scheduled Distribution Date") and
the Redemption Date, if any, pursuant to Section 10.1(a) of the Indenture.
Capitalized terms used but not defined herein are defined in Article I of the
Indenture, which also contains rules as to construction that shall be
applicable herein.
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The Issuer shall pay interest on this Note at the rate per
annum shown above on each Distribution Date until the principal of this Note is
paid or made available for payment, on the principal amount of this Note
outstanding on the preceding Distribution Date (after giving effect to all
payments of principal made on the preceding Distribution Date), subject to
certain limitations contained in Section 3.1 of the Indenture. Interest on
this Note will accrue for each Distribution Date from and including the
fifteenth day of the calendar month immediately preceding such Distribution
Date (or, in the case of the initial Distribution Date, from the Closing Date)
to but excluding the fifteenth day of the following calendar month. Interest
will be computed on the basis of a 360-day year of twelve 30- day months. Such
principal of and interest on this Note shall be paid in the manner specified on
the reverse hereof.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of this
Note.
Reference is made to the further provisions of this Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth on the face of this Note.
Unless the certificate of authentication hereon has been
executed by the Indenture Trustee whose name appears below by manual signature,
this Note shall not be entitled to any benefit under the Indenture referred to
on the reverse hereof, or be valid or obligatory for any purpose.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, the Issuer has caused this instrument to
be signed, manually or in facsimile, by its Authorized Officer, as of the date
set forth below.
Date: May 28, 1998
FORD CREDIT AUTO OWNER TRUST 1998-B
By: PNC BANK, DELAWARE,
not in its individual
capacity but solely as
Owner Trustee under the
Trust Agreement
By:
---------------------
Authorized Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Notes designated above and referred to in the
within-mentioned Indenture.
Date: May 28, 1998
THE CHASE MANHATTAN BANK,
not in its individual capacity
but solely as Indenture Trustee
By:
------------------------------
Authorized Officer
151
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the
Issuer, designated as its Class B 6.15% Asset Backed Notes (the "Class B Notes"
and, together with the Class A Notes referred to below, the "Notes") which,
together with the Issuer's Class A-1 5.615% Asset Backed Notes (the "Class A-1
Notes"), Class A-2 5.80% Asset Backed Notes (the "Class A-2 Notes"), Class A-3
5.85% Asset Backed Notes (the "Class A-3 Notes") and Class A-4 5.90% Asset
Backed Notes (the "Class A-4 Notes" and, together with the Class A-1 Notes, the
Class A-2 Notes and the Class A-3 Notes, the "Class A Notes"), are issued under
the Indenture, to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the
Noteholders. The Notes are subject to all terms of the Indenture.
The Class B Notes are and will be equally and ratably secured
by the collateral pledged as security therefor as provided in the Indenture.
The Class B Notes are subordinated in right of payment to the Class A Notes as
and to the extent provided in the Indenture.
Principal of the Class B Notes will be payable on each
Distribution Date in an amount described on the face hereof. "Distribution
Date" means the fifteenth day of each month, or, if any such day is not a
Business Day, the next succeeding Business Day, commencing June 15, 1998.
As described on the face hereof, the entire unpaid principal
amount of this Note shall be due and payable on the earlier of the Class B
Final Scheduled Distribution Date and the Redemption Date, if any, pursuant to
Section 10.1(a) of the Indenture. Notwithstanding the foregoing, the entire
unpaid principal amount of the Notes shall be due and payable on the date on
which an Event of Default shall have occurred and be continuing and the
Indenture Trustee or the Noteholders of Notes evidencing not less than a
majority of the principal amount of the Notes Outstanding have declared the
Notes to be immediately due and payable in the manner provided in Section 5.2
of the Indenture. All principal payments
A-5-4
152
on the Class B Notes shall be made pro rata to the Noteholders entitled
thereto.
Payments of interest on this Note on each Distribution Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made to the Person whose name appears as the
Registered Noteholder of the Note (or one or more Predecessor Notes) on the
Note Register as of the close of business on each Record Date either by wire
transfer in immediately available funds, to the account of such Noteholder at a
bank or other entity having appropriate facilities therefor, if such Noteholder
shall have provided to the Note Registrar appropriate written instructions at
least five (5) Business Days prior to such Distribution Date and such
Noteholder's Notes in the aggregate evidence a denomination of not less than
$1,000,000, or, if not, by check mailed first-class postage prepaid to such
Person's address as it appears on the Note Register on such Record Date;
provided that, unless Definitive Notes have been issued to Note Owners, with
respect to Notes registered on the Record Date in the name of the nominee of
the Clearing Agency (initially, such nominee to be Cede & Co.), payments will
be made by wire transfer in immediately available funds to the account
designated by such nominee. Such payments will be made without requiring that
this Note be submitted for notation of payment. Any reduction in the principal
amount of this Note (or any one or more Predecessor Notes) effected by any
payments made on any Distribution Date shall be binding upon all future
Noteholders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted
hereon. If funds are expected to be available, as provided in the Indenture,
for payment in full of the then remaining unpaid principal amount of this Note
on a Distribution Date, then the Indenture Trustee, in the name of and on
behalf of the Issuer, will notify the Person who was the Registered Noteholder
hereof as of the Record Date preceding such Distribution Date by notice mailed
or transmitted by facsimile prior to such Distribution Date, and the amount
then due and payable shall be payable only upon presentation and surrender of
this Note at the Indenture Trustee's principal Corporate Trust Office or at the
office of the Indenture Trustee's agent appointed for such purposes located in
The City of New York.
A-5-5
153
The Issuer shall pay interest on overdue installments of
interest at the Class B Rate to the extent lawful.
As provided in the Indenture, the Class A-4 Notes and the
Class B Notes may be redeemed, in whole but not in part, in the manner and to
the extent described in the Indenture and the Sale and Servicing Agreement.
As provided in the Indenture, and subject to certain
limitations set forth therein, the transfer of this Note may be registered on
the Note Register upon surrender of this Note for registration of transfer at
the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Noteholder hereof
or such Noteholder's attorney duly authorized in writing, with such signature
guaranteed by an "eligible guarantor institution" meeting the requirements of
the Note Registrar, and thereupon one or more new Notes of the same Class in
authorized denominations and in the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge will be
charged for any registration of transfer or exchange of this Note, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such
registration of transfer or exchange.
Each Noteholder or Note Owner, by its acceptance of a Note or,
in the case of a Note Owner, a beneficial interest in a Note, covenants and
agrees that no recourse may be taken, directly or indirectly, with respect to
the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on
the Notes or under the Indenture or any certificate or other writing delivered
in connection therewith, against (i) the Indenture Trustee or the Owner
Trustee, each in its individual capacity, (ii) any owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, agent,
officer, director or employee of the Indenture Trustee or the Owner Trustee,
each in its individual capacity, any holder of a beneficial interest in the
Issuer, the Owner Trustee or the Indenture Trustee or of any successor or
assign of the Indenture Trustee or the Owner Trustee, each in its individual
capacity, except as any such
A-5-6
154
Person may have expressly agreed and except that any such partner, owner or
beneficiary shall be fully liable, to the extent provided by applicable law,
for any unpaid consideration for stock, unpaid capital contribution for stock,
unpaid capital contribution or failure to pay any installment or call owing to
such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note, covenants and agrees
by accepting the benefits of the Indenture that such Noteholder or Note Owner
will not at any time institute against the Seller, the General Partner or the
Issuer, or join in any institution against the Seller, the General Partner or
the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under any United States federal or State bankruptcy or
similar law in connection with any obligations relating to the Notes, the
Indenture or the other Basic Documents.
The Issuer has entered into the Indenture and this Note is
issued with the intention that, for federal, State and local income, and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Indenture Trust Estate. Each Noteholder, by its acceptance of a
Note (and each Note Owner by its acceptance of a beneficial interest in a
Note), will be deemed to agree to treat the Notes for federal, State and local
income, single business and franchise tax purposes as indebtedness of the
Issuer.
Prior to the due presentment for registration of transfer of
this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the Indenture)
is registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Noteholders under the Indenture
at any time by the Issuer with the consent of the Noteholders of
A-5-7
155
Notes evidencing not less than a majority of the principal amount of the Notes
Outstanding. The Indenture also contains provisions permitting the Noteholders
of Notes evidencing specified percentages of the principal amount of the Notes
Outstanding, on behalf of all Noteholders, to waive compliance by the Issuer
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Noteholder
of this Note (or any one or more Predecessor Notes) shall be conclusive and
binding upon such Noteholder and upon all future Noteholders of this Note and
of any Note issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof whether or not notation of such consent or waiver is
made upon this Note. The Indenture also permits the Indenture Trustee to amend
or waive certain terms and conditions set forth in the Indenture without the
consent of the Noteholders.
The term "Issuer", as used in this Note, includes any
successor to the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the Indenture
Trustee and the Noteholders under the Indenture.
The Notes are issuable only in registered form in
denominations as provided in the Indenture, subject to certain limitations
therein set forth.
This Note and the Indenture shall be governed by, and
construed in accordance with the laws of the State of New York, without
reference to its conflicts of law provisions.
No reference herein to the Indenture, and no provision of this
Note or of the Indenture, shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and interest on
this Note at the times, place and rate, and in the coin or currency herein
prescribed.
The Class B Notes may not be acquired by or on behalf of a
Person other than (A) a citizen or resident of the United States, (B) a
corporation or partnership organized in or under the laws of the United States
or
A-5-8
156
any political subdivision thereof, (C) an estate the income of which is
includible in gross income for United States tax purposes, regardless of its
source, (D) a trust if a U.S. court is able to exercise primary supervision
over the administration of such trust and one or more Persons meeting the
conditions of this paragraph has the authority to control all substantial
decisions of the trust or (E) a Person not described in clauses (A) through (D)
above whose ownership of the Class B Notes is effectively connected with such
Person's conduct of a trade or business within the United States (within the
meaning of the Code) and who provides the Indenture Trustee and the Issuer with
an IRS Form 4224 (and such other certifications, representations, or opinions
of counsel as may be requested by the Indenture Trustee or the Issuer).
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, none of The Chase Manhattan Bank, in
its individual capacity, PNC Bank, Delaware, in its individual capacity, any
owner of a beneficial interest in the Issuer, or any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors
or assigns shall be personally liable for, nor shall recourse be had to any of
them for, the payment of principal or of interest on this Note or performance
of, or omission to perform, any of the covenants, obligations or
indemnifications contained in the Indenture. The Noteholder of this Note, by
his acceptance hereof, agrees that, except as expressly provided in the Basic
Documents, in the case of an Event of Default under the Indenture, the
Noteholder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing contained herein shall
be taken to prevent recourse to, and enforcement against, the assets of the
Issuer for any and all liabilities, obligations and undertakings contained in
the Indenture or in this Note.
A-5-9
157
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto:
--------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints _________________, attorney, to transfer said Note on the books
kept for registration thereof, with full power of substitution in the premises.
Dated: */
-------------------------------- --------------------------
Signature Guaranteed
*/
--------------------------
-----------------------------
*/ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any
change whatever. Such signature must be guaranteed by an "eligible
guarantor institution" meeting the requirements of the Note Registrar.
A-5-10
158
EXHIBIT B
[FORM OF NOTE DEPOSITORY AGREEMENT]
B-1
159
EXHIBIT C
[FORM OF INVESTMENT LETTER]
[Date]
Ford Credit Auto Owner Trust 1998-B,
as Issuer
The Chase Manhattan Bank,
as Indenture Trustee and
as Note Registrar
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
In connection with our proposed purchase of the Class B 6.15% Asset
Backed Notes (the "Class B Notes") of Ford Credit Auto Owner Trust 1998-B (the
"Issuer"), a trust formed by Ford Credit Auto Receivables Two L.P., we confirm
that:
1. We are, and each account (if any) for which we are
purchasing the Class B Notes is, a person who is (A) a citizen or resident of
the United States, (B) a corporation or partnership organized in or under the
laws of the United States or any political subdivision thereof, (C) an estate
the income of which is includible in gross income for United States tax
purposes, regardless of its source, (D) a trust if a U.S. court is able to
exercise primary supervision over the administration of such trust and one or
more Persons meeting the conditions of clause (A), (B), (C) or (E) of this
paragraph 1 has the authority to control all substantial decisions of the trust
or (E) a Person not described in clauses (A) through (D) above whose ownership
of the Class B Notes is effectively connected with such Person's conduct of a
trade or business within the United States (within the meaning of the Code) and
who provides the Indenture Trustee and the Issuer with an IRS Form 4224 (and
such other certifications, representations, or opinions of counsel as may be
requested by the Indenture Trustee or the Issuer).
2. We understand that any purported transfer of any Class B
Note (or any interest therein) to any person who does not meet the conditions
of paragraph 1
C-1
160
above shall be null and void, and the purported transferee in any such
purported transfer shall not be recognized by the Issuer or any other person as
a Noteholder of a Class B Note for any purpose.
3. We agree that if we determine to transfer any of the Class
B Notes we will cause our proposed transferee to provide to the Indenture
Trustee, the Note Registrar and the Issuer a letter substantially in the form
of this letter.
You are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceedings or official inquiry with respect to the
matters covered hereby.
Very truly yours,
By:
----------------------------
Name:
Title:
Securities To Be Purchased:
$ principal amount of Class B Notes
Annex A attached hereto lists the name of the account and principal amount of
Class B Notes purchased for each account (if any) for which we are purchasing
Class B Notes.
C-2
161
SCHEDULE A
Schedule of Receivables
[Provided to the Indenture Trustee at the Closing]
SA-1
162
APPENDIX A
Definitions and Usage
AA-1
