EXHIBIT 4.27
INDENTURE
DATED AS OF MARCH 1, 2008
BETWEEN
CPS AUTO RECEIVABLES TRUST 2008-A, AS ISSUER
AND
XXXXX FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE
TABLE OF CONTENTS
PAGE
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ARTICLE I - Definitions and Incorporation by Reference......................................3
SECTION 1.1 Definitions...............................................................3
SECTION 1.2 Reserved.................................................................10
SECTION 1.3 Other Definitional Provisions............................................10
ARTICLE II - The Notes.....................................................................11
SECTION 2.1 Form.....................................................................11
SECTION 2.2 Execution, Authentication and Delivery...................................11
SECTION 2.3 Temporary Notes..........................................................12
SECTION 2.4 Registration; Registration of Transfer and Exchange......................12
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes...............................14
SECTION 2.6 Persons Deemed Owner.....................................................15
SECTION 2.7 Payment of Principal and Interest; Defaulted Interest....................15
SECTION 2.8 Cancellation.............................................................16
SECTION 2.9 Release of Collateral....................................................16
SECTION 2.10 Book-Entry Notes.........................................................16
SECTION 2.11 Notices to Clearing Agency...............................................17
SECTION 2.12 Definitive Notes.........................................................18
SECTION 2.13 Restrictions on Transfer of Notes........................................18
ARTICLE III - Covenants.................................................................20
SECTION 3.1 Payment of Principal and Interest........................................20
SECTION 3.2 Maintenance of Office or Agency..........................................20
SECTION 3.3 Money for Payments to be Held in Trust...................................20
SECTION 3.4 Existence................................................................22
SECTION 3.5 Protection of Trust Estate...............................................22
SECTION 3.6 Opinions as to Trust Estate..............................................23
SECTION 3.7 Performance of Obligations; Servicing of Receivables.....................23
SECTION 3.8 Negative Covenants.......................................................24
SECTION 3.9 Annual Statement as to Compliance........................................25
SECTION 3.10 Issuer May Consolidate, Etc. Only on Certain Terms.......................25
SECTION 3.11 Successor or Transferee..................................................28
SECTION 3.12 No Other Business........................................................28
SECTION 3.13 No Borrowing.............................................................28
SECTION 3.14 Servicer's Obligations...................................................28
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities........................28
SECTION 3.16 Capital Expenditures.....................................................28
SECTION 3.17 Compliance with Laws.....................................................28
SECTION 3.18 Restricted Payments......................................................29
SECTION 3.19 Notice of Events of Default..............................................29
SECTION 3.20 Further Instruments and Acts.............................................29
SECTION 3.21 Amendments of Sale and Servicing Agreement and Trust Agreement...........29
SECTION 3.22 Income Tax Characterization..............................................29
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SECTION 3.23 Separate Existence of the Issuer.........................................29
SECTION 3.24 Representations and Warranties of the Issuer.............................30
ARTICLE IV - Satisfaction and Discharge....................................................31
SECTION 4.1 Satisfaction and Discharge of Indenture..................................31
SECTION 4.2 Application of Trust Money...............................................31
SECTION 4.3 Repayment of Moneys Held by Note Paying Agent............................32
ARTICLE V - Remedies.......................................................................32
SECTION 5.1 Events of Default........................................................32
SECTION 5.2 Rights Upon Event of Default.............................................33
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee..........34
SECTION 5.4 Remedies.................................................................37
SECTION 5.5 Optional Preservation of the Receivables.................................37
SECTION 5.6 Priorities...............................................................38
SECTION 5.7 Limitation of Suits......................................................39
SECTION 5.8 Unconditional Rights of Noteholders To Receive Principal and Interest....40
SECTION 5.9 Restoration of Rights and Remedies.......................................40
SECTION 5.10 Rights and Remedies Cumulative...........................................40
SECTION 5.11 Delay or Omission Not a Waiver...........................................40
SECTION 5.12 Control by Noteholders...................................................40
SECTION 5.13 Waiver of Past Defaults..................................................41
SECTION 5.14 Undertaking for Costs....................................................41
SECTION 5.15 Waiver of Stay or Extension Laws.........................................42
SECTION 5.16 Subrogation..............................................................42
SECTION 5.17 Preference Claims; Direction of Proceedings..............................42
ARTICLE VI - The Trustee...................................................................43
SECTION 6.1 Duties of Trustee........................................................43
SECTION 6.2 Rights of Trustee........................................................44
SECTION 6.3 Individual Rights of Trustee.............................................46
SECTION 6.4 Trustee's Disclaimer.....................................................46
SECTION 6.5 Notice of Defaults.......................................................46
SECTION 6.6 Reports by Trustee to Holders............................................46
SECTION 6.7 Compensation and Indemnity...............................................46
SECTION 6.8 Replacement of Trustee...................................................47
SECTION 6.9 Successor Trustee by Merger..............................................48
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee............................48
SECTION 6.11 Eligibility: Disqualification............................................49
SECTION 6.12 Reserved.................................................................49
SECTION 6.13 Appointment and Powers...................................................50
SECTION 6.14 Performance of Duties....................................................50
SECTION 6.15 Limitation on Liability..................................................50
SECTION 6.16 Reserved.................................................................51
SECTION 6.17 Successor Trustee........................................................51
SECTION 6.18 Reserved.................................................................52
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SECTION 6.19 Representations and Warranties of the Trustee...........................52
SECTION 6.20 Waiver of Setoffs.......................................................52
SECTION 6.21 Control by the Controlling Party........................................52
ARTICLE VII - Noteholders' Lists and Reports..............................................52
SECTION 7.1 Issuer To Furnish To Trustee Names and Addresses of Noteholders.........52
SECTION 7.2 Preservation of Information; Communications to Noteholders..............53
ARTICLE VIII - Collection of Money and Releases of Trust Estate...........................53
SECTION 8.1 Collection of Money.....................................................53
SECTION 8.2 Release of Trust Estate.................................................53
SECTION 8.3 Opinion of Counsel......................................................54
ARTICLE IX - Supplemental Indentures......................................................54
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders..................54
SECTION 9.2 Supplemental Indentures with Consent of Noteholders.....................55
SECTION 9.3 Execution of Supplemental Indentures....................................57
SECTION 9.4 Effect of Supplemental Indenture........................................57
SECTION 9.5 Reserved................................................................57
SECTION 9.6 Reference in Notes to Supplemental Indentures...........................57
ARTICLE X - Redemption of Notes...........................................................57
SECTION 10.1 Redemption..............................................................57
SECTION 10.2 Form of Redemption Notice...............................................58
SECTION 10.3 Notes Payable on Redemption Date........................................58
ARTICLE XI - Miscellaneous................................................................59
SECTION 11.1 Compliance Certificates and Opinions, etc...............................59
SECTION 11.2 Form of Documents Delivered to Trustee..................................60
SECTION 11.3 Acts of Noteholders.....................................................61
SECTION 11.4 Notices, etc., to Trustee, Issuer and Rating Agencies...................62
SECTION 11.5 Notices to Noteholders; Waiver..........................................63
SECTION 11.6 Alternate Payment and Notice Provisions.................................63
SECTION 11.7 Reserved................................................................63
SECTION 11.8 Effect of Headings and Table of Contents................................64
SECTION 11.9 Successors and Assigns..................................................64
SECTION 11.10 Severability............................................................64
SECTION 11.11 Benefits of Indenture...................................................64
SECTION 11.12 Legal Holidays..........................................................64
SECTION 11.13 Governing Law...........................................................64
SECTION 11.14 Counterparts............................................................64
SECTION 11.15 Recording of Indenture..................................................64
SECTION 11.16 Trust Obligation........................................................65
SECTION 11.17 No Petition.............................................................65
SECTION 11.18 Inspection..............................................................65
SECTION 11.19 Action Upon Direction of Noteholders....................................65
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INDENTURE dated as of March 1, 2008, between CPS AUTO RECEIVABLES TRUST
2008-A, a Delaware statutory trust (the "Issuer"), and XXXXX FARGO BANK,
NATIONAL ASSOCIATION, a national banking association, as trustee (the
"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 3.4695%
Asset-Backed Notes (the "Class A-1 Notes"), Class A-2 4.95% Asset-Backed Notes
(the "Class A-2 Notes"), Class A-3 6.48% Asset-Backed Notes (the "Class A-3
Notes") and Class A-4 7.13% 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 "Notes"):
As security for the payment and performance by the Issuer of its
obligations under this Indenture and the Notes, the Issuer has agreed to assign
the Collateral (as defined below) as collateral to the Trustee for the benefit
of the Noteholders.
Financial Security Assurance Inc. (the "Note Insurer") has issued and
delivered a financial guaranty insurance policy, dated the Closing Date (with
endorsements, the "Note Policy"), pursuant to which the Note Insurer guarantees
Scheduled Payments, as defined in the Note Policy.
As an inducement to the Note Insurer to issue and deliver the Note
Policy, the Issuer and the Note Insurer have executed and delivered the
Insurance and Indemnity Agreement dated as of April 10, 2008 (as amended from
time to time, in accordance with the terms thereof, the "Insurance Agreement")
among the Note Insurer, the Issuer, Consumer Portfolio Services, Inc., CPS
Receivables Funding Trust and CPS Receivables LLC (the "Seller")
As an additional inducement to the Note Insurer to issue the Note
Policy, and as security for the performance by the Issuer of the Issuer Secured
Obligations (as defined below) the Issuer has agreed to assign the Collateral
(as defined below) as collateral to the Trustee for the benefit of the Issuer
Secured Parties (as defined below), as their respective interests may appear.
GRANTING CLAUSE
The Issuer hereby Grants to the Trustee at the Closing Date, for the
benefit of the Issuer Secured Parties, all right, title and interest of the
Issuer, whether now existing or hereafter arising, in and to the following:
(i) the Receivables listed in Schedule A to the Sale and
Servicing Agreement and all monies received thereunder (other than the
Additional Servicing Compensation) after the Cutoff Date and all Net
Liquidation Proceeds and Recoveries received with respect to such
Receivables after the Cutoff Date;
(ii) the security interests in the Financed Vehicles granted
by the related Obligors pursuant to the Receivables and any other
interest of the Issuer in such Financed Vehicles, including the
certificates of title or, with respect to such Financed Vehicles in the
Non-Certificated Title States, all other evidence of ownership with
respect to such Financed Vehicles issued by the applicable Department
of Motor Vehicles or similar authority;
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(iii) any proceeds from claims on any physical damage, credit
life and credit accident and health insurance policies or certificates
relating to the Financed Vehicles securing the Receivables or the
Obligors thereunder;
(iv) all proceeds from recourse against Dealers or Consumer
Lenders with respect to the Receivables;
(v) all of the Seller's right, title and interest in its
rights and benefits, but none of its obligations or burdens, under the
Purchase Agreement, including a direct right to cause CPS to purchase
Receivables from the Issuer and to indemnify the Issuer pursuant to the
Purchase Agreement under the circumstances specified therein;
(vi) the Issuer's rights and benefits, but none of its
obligations or burdens, under the Sale and Servicing Agreement
(including all rights of the Seller under the Purchase Agreement);
(vii) refunds for the costs of extended service contracts with
respect to Financed Vehicles securing Receivables, refunds of unearned
premiums with respect to credit life and credit accident and health
insurance policies or certificates covering an Obligor or Financed
Vehicle or his or her obligations with respect to a Financed Vehicle
and any recourse to Dealers or Consumer Lenders for any of the
foregoing;
(viii) the Receivable File related to each Receivable;
(ix) all amounts and property from time to time held in or
credited to the Collection Account, the Note Distribution Account and
the Lockbox Account;
(x) all property (including the right to receive future Net
Liquidation Proceeds) that secures a Receivable that has been acquired
by or on behalf of CPS, the Seller or the Issuer pursuant to a
liquidation of such Receivable; and
(xi) all present and future claims, demands, causes 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, 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 property
described in this Granting Clause the "Collateral").
In addition, the Issuer shall cause the Note Policy to be issued for
the benefit of the Noteholders.
The foregoing Grant is made in trust to the Trustee, for the benefit of
the Issuer Secured Parties, as their interests may appear, to secure the payment
and performance of the Issuer Secured Obligations and to secure compliance with
this Indenture. The Trustee hereby acknowledges such Grant, accepts the trusts
under this Indenture in accordance with the provisions of this Indenture and
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agrees to perform its duties as required in this Indenture to the end that the
interests of such parties, recognizing the priorities of their respective
interests, may be adequately and effectively protected.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
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SECTION 1.1 DEFINITIONS. Except as otherwise specified herein, the
following terms have the respective meanings set forth below for all purposes of
this Indenture and the definitions of such terms are equally applicable to both
the singular and plural forms of such terms and to each gender.
Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to them in the Sale and Servicing Agreement or, if
not defined therein, in the Trust Agreement.
"Act" has the meaning specified in Section 11.3(a).
"Affiliate" of any Person means any Person who directly or indirectly
controls, is controlled by, or is under direct or indirect common control with
such Person. For purposes of this definition of "Affiliate", the term "control"
(including the terms "controlling", "controlled by" and "under common control
with") means the possession, directly or indirectly, of the power to direct or
cause a direction of the management and policies of a Person, whether through
the ownership of voting securities, by contract or otherwise.
"Amount Financed" with respect to a Receivable shall have the meaning
specified in the Sale and Servicing Agreement.
"Annual Percentage Rate" or "APR" of a Receivable means the annual rate
of finance charges stated in the Receivable.
"Authorized Officer" means, with respect to the Issuer and the
Servicer, any officer or agent acting pursuant to a power of attorney of the
Owner Trustee or the Servicer, as applicable, who is authorized to act for the
Owner Trustee or the Servicer, as applicable, in matters relating to the Issuer
and who is identified on the list of Authorized Officers delivered by each of
the Owner Trustee and the Servicer to the Trustee on the Closing Date (as such
list may be modified or supplemented from time to time thereafter).
"Basic Documents" means this Indenture, the Certificate of Trust, the
Trust Agreement, the Sale and Servicing Agreement, the Master Spread Account
Agreement, the Spread Account Supplement, the Insurance Agreement, the
Indemnification Agreement, the Lockbox Agreement, the Servicing Assumption
Agreement, the Purchase Agreement, the Placement Agency Agreement, the Notes,
the Residual Pass-through Certificates, any trust agreement, indenture or other
agreement to which the Seller, CPS or the Trust or any of their respective
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Affiliates is a party entered into in connection with a transfer of any interest
in the Residual Pass-through Certificates, any securities representing direct or
indirect interests in the Residual Pass-through Certificates and other documents
and certificates delivered in connection with the foregoing.
"Book Entry Notes" means a beneficial interest in the Notes, ownership
and transfers of which shall be made through book entries by a Clearing Agency
as described in Section 2.10.
"Business Day" means any day other than a Saturday, a Sunday or a day
on which banking institutions in Wilmington, Delaware, New York, New York,
Minneapolis, Minnesota, the State in which the executive offices of the Servicer
are located or the State in which the principal place of business of the Note
Insurer is located shall be authorized or obligated by law, executive order, or
governmental decree to be closed.
"Certificate of Trust" means the certificate of trust of the Issuer
substantially in the form of Exhibit B to the Trust Agreement.
"Class A-1 Interest Rate" means 3.4695% per annum.
"Class A-1 Notes" means the Class A-1 3.4695% Asset-Backed Notes,
substantially in the form of Exhibit A-1.
"Class A-2 Interest Rate" means 4.95% per annum.
"Class A-2 Notes" means the Class A-2 4.95% Asset-Backed Notes,
substantially in the form of Exhibit A-2.
"Class A-3 Interest Rate" means 6.48% per annum.
"Class A-3 Notes" means the Class A-3 6.48% Asset-Backed Notes,
substantially in the form of Exhibit A-3.
"Class A-4 Interest Rate" means 7.13% per annum.
"Class A-4 Notes" means the Class A-4 7.13% Asset-Backed Notes,
substantially in the form of Exhibit A-4.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act, or any successor provision
thereto. The initial Clearing Agency shall be The Depository Trust Company.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means April 10, 2008.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of this
Indenture.
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"Commission" means the United States Securities and Exchange
Commission.
"Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered
which office at date of the execution of this Agreement is located at Sixth
Street and Marquette Avenue, MAC N9311-161, Xxxxxxxxxxx, Xxxxxxxxx 00000,
Attention: Corporate Trust Services/Asset Backed Administration - CPS 2008-A, or
at such other address as the Trustee may designate from time to time by notice
to the Noteholders, the Note Insurer, the Servicer and the Issuer, or the
principal corporate trust office of any successor Trustee (the address of which
the successor Trustee will notify the Noteholders and the Issuer).
"Default" means any occurrence that is, or with notice or the lapse of
time or both would become, an Event of Default.
"Definitive Notes" has the meaning specified in Section 2.10.
"Depositor" means the Seller, in its capacity as such under the Trust
Agreement.
"Event of Default" has the meaning specified in Section 5.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Executive Officer" means, with respect to any corporation, the Chief
Executive Officer, Chief Operating Officer, Chief Investment Officer, Chief
Financial Officer, President, Senior Vice President, any Vice President, the
Secretary or the Treasurer of such corporation; with respect to any limited
liability company, the manager; and with respect to any partnership, any general
partner thereof.
"Grant" means to mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, xxxxx x xxxx upon and a
security interest in and right of set-off against, deposit, set over and confirm
pursuant to this Indenture. A Grant of the Collateral or of any other agreement
or instrument shall include all rights, powers and options (but none of the
obligations) of the granting party thereunder, including the immediate and
continuing right to claim for, collect, receive and give receipt for principal
and interest payments in respect of the Collateral and all other moneys payable
thereunder, to give and receive notices and other communications, to make
waivers or other agreements, to exercise all rights and options, to bring
proceedings in the name of the granting party or otherwise and generally to do
and receive anything that the granting party is or may be entitled to do or
receive thereunder or with respect thereto.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Note Register.
"Indebtedness" means, with respect to any Person at any time, (a)
indebtedness or liability of such Person for borrowed money whether or not
evidenced by bonds, debentures, notes or other instruments, or for the deferred
purchase price of property or services (including trade obligations); (b)
obligations of such Person as lessee under leases which should be, in accordance
with generally accepted accounting principles, recorded as capital leases; (c)
current liabilities of such Person in respect of unfunded vested benefits under
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plans covered by Title IV of ERISA; (d) obligations issued for or liabilities
incurred on the account of such Person; (e) obligations or liabilities of such
Person arising under acceptance facilities; (f) obligations of such Person under
any guarantees, endorsements (other than for collection or deposit in the
ordinary course of business) and other contingent obligations to purchase, to
provide funds for payment, to supply funds to invest in any Person or otherwise
to assure a creditor against loss; (g) obligations of such Person secured by any
lien on property or assets of such Person, whether or not the obligations have
been assumed by such Person; or (h) obligations of such Person under any
interest rate or currency exchange agreement.
"Indenture" means this Indenture as amended, supplemented or otherwise
modified from time to time in accordance with its terms.
"Independent" means, when used with respect to any specified Person,
that the person (a) is in fact independent of the Issuer, any other obligor upon
the Notes, the Seller and any Affiliate of any of the foregoing persons, (b)
does not have any direct financial interest or any material indirect financial
interest in the Issuer, any such other obligor, the Seller or any Affiliate of
any of the foregoing Persons and (c) is not connected with the Issuer, any such
other obligor, the Seller or any Affiliate of any of the foregoing Persons as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions.
"Insolvency Event" means, with respect to a specified Person, (a) the
institution of a proceeding or the filing of a petition against such Person
seeking the entry of a decree or order for relief by a court having jurisdiction
in the premises in respect of such Person or any substantial part of its
property in an involuntary case under any applicable Federal or State
bankruptcy, insolvency or other similar law now or hereafter in effect, or the
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part of
its property, or ordering the winding-up or liquidation or such Person's
affairs, and such petition, decree or order shall remain unstayed and in effect
for a period of 60 consecutive days; or (b) the commencement by such Person 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 such Person to
the entry of an order for relief in an involuntary case under any such law, or
the consent by such Person to the appointment of or taking possession by, a
receiver, liquidator, assignee, custodian, trustee, sequestrator, or similar
official for such Person or for any substantial part of its property, or the
making by such Person of any general assignment for the benefit of creditors, or
the failure by such Person generally to pay its debts as such debts become due,
or the taking of action by such Person in furtherance of any of the foregoing.
"Insurance Agreement Indenture Cross Default" has the meaning specified
therefor in the Insurance Agreement.
"Insurer Secured Obligations" means all amounts and obligations which
the Issuer may at any time owe to or on behalf of the Note Insurer under this
Indenture, the Insurance Agreement or any other Basic Document.
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"Interest Rate" means, with respect to (i) the Class A-1 Notes, the
Class A-1 Interest Rate, (ii) the Class A-2 Notes, the Class A-2 Interest Rate,
(iii) the Class A-3 Notes, the Class A-3 Interest Rate and (iv) the Class A-4
Notes, the Class A-4 Interest Rate.
"Issuer" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision contained herein, each other obligor on the Notes.
"Issuer Order" and "Issuer Request" means a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and
delivered to the Trustee.
"Issuer Secured Obligations" means the Insurer Secured Obligations, the
Residual Certificate Secured Obligations and the Trustee Secured Obligations,
collectively.
"Issuer Secured Parties" means each of (i) the Trustee, in respect of
the Trustee Secured Obligations, (ii) the Residual Certificateholders, in
respect of the Residual Certificate Secured Obligations and (iii) the Note
Insurer, in respect of the Insurer Secured Obligations.
"Note" means a Class A-1 Note, a Class A-2 Note, a Class A-3 Note or a
Class A-4 Note.
"Note Insurer" has the meaning specified in the Preamble.
"Note Majority" means Holders of Notes collectively evidencing more
than 50% of the aggregate outstanding Note Balance of each Class of Notes.
"Note Owner" means, with respect to a Book Entry Note, the person who
is the owner of such Book-Entry Note, as reflected on the books of the Clearing
Agency, or on the books of a Person maintaining an account with such Clearing
Agency (directly as a Clearing Agency Participant or as an indirect participant,
in each case in accordance with the rules of such Clearing Agency).
"Note Paying Agent" means the Trustee or any other Person that meets
the eligibility standards for the Trustee specified in Section 6.11 and is
authorized by the Issuer to make the payments to and distributions from the
Collection Account and the Note Distribution Account, including payment of
principal of or interest on the Notes on behalf of the Issuer.
"Note Policy" means the financial guaranty insurance policy (No.
51897-N) issued by the Note Insurer with respect to the Notes, including any
endorsements thereto.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.4.
"Officer's Certificate" means a certificate signed by any Authorized
Officer of the Owner Trustee, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.1, and
delivered to the Trustee. Unless otherwise specified, any reference in this
Indenture to an Officer's Certificate shall be to an Officer's Certificate of
any Authorized Officer of the Issuer.
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"Opinion of Counsel" means one or more written opinions of counsel who
may, except as otherwise expressly provided in this Indenture, be employees of
or counsel to the Issuer and who shall be satisfactory to the Trustee and, if
addressed to the Note Insurer, satisfactory to the Note Insurer, and which shall
comply with any applicable requirements of Section 11.1, and shall be in form
and substance satisfactory to the Trustee, and if addressed to the Note Insurer,
satisfactory to the Note Insurer.
"Outstanding" means, as of the date of determination, all Notes
theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore canceled by the Note Registrar
or delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which
money in the necessary amount has been theretofore deposited
with the Trustee or any Note Paying Agent in trust for the
Holders of such Notes (provided, however, that if such Notes
are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture, satisfactory to the
Trustee); and
(iii) Notes in exchange for or in lieu of other Notes
which have been authenticated and delivered pursuant to this
Indenture unless proof satisfactory to the Trustee is
presented that any such Notes are held by a bona fide
purchaser; provided, however, that Notes which have been paid
with proceeds of the Note Policy shall continue to remain
Outstanding for purposes of this Indenture until the Note
Insurer has been paid as subrogee hereunder or reimbursed
pursuant to the Insurance Agreement as evidenced by a written
notice from the Note Insurer delivered to the Trustee, and the
Note Insurer shall be deemed to be the Holder thereof to the
extent of any payments thereon made by the Note Insurer;
provided, further, that in determining whether the Holders of
the requisite Outstanding Amount of the Notes have given any
request, demand, authorization, direction, notice, consent or
waiver hereunder or under any Basic Document, Notes owned by
the Issuer, any other obligor upon the Notes, the Seller or
any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying
upon any such request, demand, authorization, direction,
notice, consent or waiver, only Notes that a Responsible
Officer of the Trustee either actually knows to be so owned or
has received written notice thereof shall be so disregarded.
Notes so owned that have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with
respect to such Notes and that the pledgee is not the Issuer,
any other obligor upon the Notes, the Seller or any Affiliate
of any of the foregoing Persons.
"Outstanding Amount" means, with respect to any date of determination,
the aggregate principal amount of all Notes, or class of Notes, as applicable,
Outstanding at such date of determination.
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"Ownership Interest" means, as to any Note, any ownership or security
interest in such Note, including any interest in such Note as the Holder thereof
and any other interest therein, whether direct or indirect, legal or beneficial,
as owner or as pledgee.
"Owner Trustee" means Wilmington Trust Company, not in its individual
capacity, but solely as Owner Trustee under the Trust Agreement, and its
successors.
"Payment Date" has the meaning specified in the Notes.
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.5 in lieu of a mutilated, lost,
destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.
"Proceeding" means any suit in equity, action at law or other judicial
or administrative proceeding.
"Purchase Agreement" means the Receivables Purchase Agreement.
"Rating Agency" means each of Moody's and Standard & Poor's, so long as
such Persons maintain a rating on the Notes; and if either Moody's or Standard &
Poor's no longer maintains a rating on the Notes, such other nationally
recognized statistical rating organization selected by the Seller and (so long
as an Insurer Default shall not have occurred and be continuing) acceptable to
the Note Insurer.
"Record Date" means, with respect to the first Payment Date, the
Closing Date, and with respect to any subsequent Payment Date or Redemption
Date, the last calendar day of the month preceding the month in which such
Payment Date or Redemption Date occurs.
"Redemption Date" means, in the case of a redemption of the Notes
pursuant to Section 10.1, the Payment Date specified by the Servicer or the
Issuer pursuant to Section 10.1.
"Redemption Price" means, in the case of a redemption of the Notes
pursuant to Section 10.1, an amount equal to the unpaid principal amount of each
class of Notes being redeemed plus accrued and unpaid interest thereon to but
excluding the Redemption Date.
"Residual Certificate Secured Obligations" means all amounts and
obligations that the Issuer may at any time owe to the Residual
Certificateholders under the Sale and Servicing Agreement or any other Basic
Document.
"Responsible Officer" means, with respect to the Trustee, any officer
within the Corporate Trust Office of the Trustee, including any Vice President,
Assistant Vice President, Assistant Treasurer, Assistant Secretary, or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge of and familiarity with the particular subject.
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"Sale and Servicing Agreement" means the Sale and Servicing Agreement
dated as of March 1, 2008, among the Issuer, the Seller, the Servicer, and the
Trustee, as Backup Servicer and Trustee, as the same may be amended or
supplemented from time to time.
"Scheduled Payments" has the meaning specified in the Note Policy.
"Seller" means CPS Receivables LLC, a Delaware limited liability
company, and its successors.
"State" means any one of the 50 states of the United States of America
or the District of Columbia.
"Termination Date" means the latest of (i) the expiration of the Note
Policy and the return of the Note Policy to the Note Insurer for cancellation,
(ii) the date on which the Note Insurer shall have received payment and
performance of all Insurer Secured Obligations and (iii) the date on which the
Trustee shall have received payment and performance of all Trustee Secured
Obligations and disbursed such payments in accordance with the Basic Documents.
"Trust Agreement" means the Trust Agreement dated as of November 15,
2007, between CPS Receivables Corp., as depositor, and the Owner Trustee, as
amended and restated by the Amended and Restated Trust Agreement dated as of
January 14, 2008, by and between the Seller (as successor by merger to CPS
Receivables Corp.), as depositor, and the Owner Trustee, and as further amended
and restated by that Second Amended and Restated Trust Agreement dated as of
April 10, 2008, as the same may be further amended or supplemented from time to
time in accordance with the terms thereof.
"Trust Estate" means all money, instruments, rights and other property
that are subject or intended to be subject to the lien and security interest of
this Indenture for the benefit of the Issuer Secured Parties (including the
Collateral Granted to the Trustee hereunder), including all proceeds thereof.
"Trustee" means Xxxxx Fargo Bank, National Association, a national
banking association, not in its individual capacity but as trustee under this
Indenture, or any successor trustee under this Indenture.
"Trustee Secured Obligations" means all amounts and obligations which
the Issuer may at any time owe to the Trustee for the benefit of the Noteholders
under this Indenture or the Notes or any other Basic Document.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from time
to time.
SECTION 1.2 RESERVED.
SECTION 1.3 OTHER DEFINITIONAL PROVISIONS. Unless the context otherwise
requires:
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(a) All references in this instrument to designated "Articles,"
"Sections," "Subsections" and other subdivisions are to the designated Articles,
Sections, Subsections and other subdivisions of this instrument as originally
executed.
(b) The words "herein," "hereof," "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section, Subsection or other subdivision.
(c) an accounting term not otherwise defined herein has the meaning
assigned to it in accordance with generally accepted accounting principles as in
effect from time to time;
(d) "or" is not exclusive; and
(e) "including" means including without limitation.
ARTICLE II
THE NOTES
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SECTION 2.1 FORM.
(a) The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class A-4 Notes, in each case together with the Trustee's certificate of
authentication, shall be in substantially the form set forth in EXHIBITS X-0,
X-0, X-0 XXX X-0, 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 of the Notes. 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 EXHIBITS X-0, X-0, X-0 XXX X-0 are part of the terms
of this Indenture.
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 Trustee shall upon receipt of the Note Policy and Issuer Order
authenticate and deliver Class A-1 Notes for original issue in an aggregate
principal amount of $39,130,000, Class A-2 Notes for original issue in an
aggregate principal amount of $95,059,000, Class A-3 Notes for original issue in
an aggregate principal amount of $88,220,000 and Class A-4 Notes for original
issue in an aggregate principal amount of $22,000,000. Class A-1 Notes, Class
A-2 Notes, Class A-3 Notes and Class A-4 Notes outstanding at any time may not
exceed such amounts except as provided in Section 2.4.
(d) Each Note shall be dated the date of its authentication. The Notes
shall be issuable as registered Notes in the minimum denomination of $25,000 and
in integral multiples of $1,000 in excess thereof (except for one Note of each
class which may be issued in a lesser denomination and other than an integral
multiple of $1,000).
(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 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 Trustee shall authenticate and
deliver, temporary Notes which are printed, lithographed, typewritten,
mimeographed or otherwise produced, 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 such Notes may determine, as
evidenced by their execution of such Notes.
(b) If temporary Notes are issued, the Issuer will cause Definitive
Notes to be prepared without unreasonable delay. After the preparation of
Definitive Notes, the temporary Notes shall be exchangeable without charge to
the Holder for Definitive Notes upon surrender of the temporary Notes at the
office or agency of the Issuer to be maintained as provided in Section 3.2. Upon
surrender for cancellation of any one or more temporary Notes, the Issuer shall
execute and the 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 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 Trustee is hereby initially appointed "Note Registrar" for the
purpose of registering Notes and transfers of Notes as herein provided. Upon any
resignation or removal of any Note Registrar, the Issuer shall promptly appoint
a successor or, in the absence of such an appointment, assume the duties of Note
Registrar.
(b) If a Person other than the Trustee is appointed by the Issuer as
Note Registrar, the Issuer will give the 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, and the Trustee shall have the right to inspect
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the Note Register at all reasonable times and to obtain copies thereof, and the
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 Holders of the Notes and the principal amounts and number of such Notes.
(c) Subject to Sections 2.10 and 2.12 hereof, 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(a)
of the UCC are met, the Issuer shall execute, and upon request by the Issuer the
Trustee shall authenticate, and the Noteholder shall obtain from the Trustee, in
the name of the designated transferee or transferees, one or more new Notes in
any authorized denominations of the same class and a like aggregate principal
amount.
(d) At the option of the Holder, Notes may be exchanged for other Notes
in any authorized denominations, of the same class and 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, subject to Sections
2.10 and 2.12 hereof, if the requirements of Section 8-401(a) of the UCC are met
the Issuer shall execute, and upon request by the Issuer the Trustee shall
authenticate, and the Noteholder shall obtain from the Trustee, the Notes which
the Noteholder making the 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 accompanied by a written instrument
of transfer in the form attached to EXHIBITS X-0, X-0, X-0 XXX X-0 and duly
executed by, the Holder thereof or such Holder's attorney, duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar which requirements include
membership or participation in Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Note Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Exchange Act and (ii) accompanied by such other documents as
the Trustee may require.
(g) Each Noteholder by its acquisition of any Notes (or a beneficial
interest therein) shall be deemed to have represented and warranted for the
benefit of the Issuer, the Owner Trustee, the Trustee and the Noteholders, that
either (i) it is not acquiring any Notes with the assets of any "employee
benefit plan" as defined in Section 3(3) of ERISA which is subject to Title I of
ERISA or any "plan" as defined in Section 4975 of the Internal Revenue Code or
(ii) the acquisition and holding of the Notes will be covered by Prohibited
Transaction Class Exemption ("PTCE") 00-00, XXXX 00-0, XXXX 91-38, XXXX 00-00,
XXXX 96-23 or a similar U.S. Department of Labor class exemption or other
similar exemption.
(h) No service charge shall be made to a Holder for any registration of
transfer or exchange of Notes, but the Note Registrar 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
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exchanges pursuant to Section 2.3 or 9.6 not involving any transfer.
(i) The preceding provisions of this Section 2.4 notwithstanding, the
Issuer shall not be required to make and the Note Registrar shall not register
transfers or exchanges of Notes selected for redemption or of any Note for a
period of 15 days preceding the due date for any payment with respect to the
Notes.
(j) Notwithstanding anything to the contrary in this Indenture or any
other Basic Document, (i) the transfer of a Note, including the right to receive
principal and any stated interest thereon, may be effected only by surrender of
the old Note (or satisfactory evidence of the destruction, loss or theft of such
Note) to the Note Registrar, and the issuance by the Issuer (through the Note
Registrar) of a new Note to the new Holder, and (ii) each Note must be
registered in the name of the Holder thereof as to both principal and any stated
interest with the Note Registrar.
SECTION 2.5 MUTILATED, DESTROYED, LOST OR STOLEN NOTES.
(a) If (i) any mutilated Note is surrendered to the Trustee, or the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, and (ii) there is delivered to the Trustee and the Note Insurer
(unless an Insurer Default shall have occurred and be continuing) such security
or indemnity as may be required by each of the Issuer, the Trustee and the Note
Insurer to hold it harmless, then, in the absence of notice to the Issuer, the
Note Registrar or the Trustee that such Note has been acquired by a bona fide
purchaser, and, provided that the requirements of Section 8-405 and 8-406 of the
UCC are met, the Issuer shall execute, and upon request by the Issuer, the
Trustee shall authenticate and deliver in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Note, a replacement Note; provided,
however, that if any such destroyed, lost or stolen Note, but not a mutilated
Note, shall have become, or within seven days shall be, due and payable or shall
have been called for redemption, instead of issuing a replacement Note, the
Issuer may direct the Trustee, in writing, to 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 bona fide purchaser of the original Note in lieu of which such
replacement Note was issued, presents for payment such original Note, the
Issuer, the Trustee and the Note Insurer shall be entitled to recover such
replacement Note (or such payment) from the 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 bona
fide 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 Trustee in connection therewith.
(b) Upon the issuance of any replacement Note under this Section, the
Issuer may require the payment by the Holder 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 Trustee) connected therewith.
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(c) Every replacement Note issued pursuant to this Section 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 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 2.6 PERSONS DEEMED OWNER. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Trustee, the Note Insurer
and any agent of the Issuer, the Trustee or the Note Insurer may treat the
Person in whose name any Note is registered (as of the applicable Record Date)
as the owner of such Note for the purpose of receiving payments of principal of
and interest, if any, on such Note, for all other purposes whatsoever and
whether or not such Note be overdue, and none of the Issuer, the Note Insurer,
the Trustee nor any agent of the Issuer, the Note Insurer or the Trustee shall
be affected by notice to the contrary.
SECTION 2.7 PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED INTEREST.
(a) The Notes shall accrue interest as provided in the forms of the
Class A-1 Note, the Class A-2 Note, the Class A-3 Note and the Class A-4 Note
attached hereto as EXHIBITS X-0, X-0, X-0 and A-4, respectively, and such
interest shall be payable on each Payment Date as specified therein. Any
installment of interest or principal, if any, payable on any Note which is
punctually paid or duly provided for by the Issuer on the applicable Payment
Date shall be paid to the Person in whose name such Note (or one or more
Predecessor Notes) is registered on the related Record Date, by check mailed
first-class, postage prepaid, to such Person's address as it appears on the Note
Register on such Record Date, or by wire transfer in immediately available funds
to the account designated in writing to the Trustee by such Person at least five
Business Days prior to the related Record Date, except that, unless Definitive
Notes have been issued pursuant to Section 2.12, with respect to Notes
registered on the related Record Date in the name of the nominee of the Clearing
Agency (initially, such nominee to be Cede & Co.), payment will be made by wire
transfer in immediately available funds to the account designated by such
nominee, except for the final installment of principal payable with respect to
such Note on a Payment Date or on the Final Scheduled Payment Date (and except
for the Redemption Price for any Note called for redemption pursuant to Section
10.1), 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
Payment Date as provided in the forms of the Class A-1 Note, the Class A-2 Note,
the Class A-3 Note and the Class A-4 Note attached hereto as EXHIBITS X-0, X-0,
X-0 and A-4, respectively. Notwithstanding the foregoing, the entire unpaid
principal amount of the 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
in the manner and under the circumstances provided in Section 5.2. All principal
payments on each class of Notes shall be made pro rata to the Noteholders of
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such class entitled thereto. Upon written notice from the Issuer, the Trustee
shall notify the Person in whose name a Note is registered at the close of
business on the Record Date preceding the Payment Date on which the Issuer
expects that the final installment of principal of and interest on such Note
will be paid. Such notice shall be mailed or transmitted by facsimile prior to
such final Payment Date and shall specify that such final installment will 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 redemptions 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 Interest Rate in any lawful manner. The
Issuer may pay such amounts to the Persons who are Noteholders on a subsequent
special record date, which date shall be at least five Business Days prior to
the Payment Date. The Issuer shall fix or cause to be fixed any such special
record date and Payment Date, and, at least 15 days before any such special
record date, the Issuer shall mail to each Noteholder and the Trustee a notice
that states the special record date, the Payment Date and the amount of
defaulted interest to be paid.
(d) Promptly following the date on which all principal of and interest
on the Notes has been paid in full and the Notes have been surrendered to the
Trustee, the Trustee shall, if the Note Insurer has paid any amount in respect
of the Notes under the Note Policy or otherwise which has not been reimbursed to
it, deliver such surrendered Notes to the Note Insurer.
SECTION 2.8 CANCELLATION. Subject to Section 2.7(d), all Notes
surrendered for payment, registration of transfer, exchange or redemption shall,
if surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly canceled by the Trustee. Subject to Section 2.7(d), the
Issuer may at any time deliver to the 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
canceled by the Trustee. No Notes shall be authenticated in lieu of or in
exchange for any Notes canceled as provided in this Section, except as expressly
permitted by this Indenture. Subject to Section 2.7(d), all canceled Notes may
be held or disposed of by the 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 they be destroyed or returned to it; provided that such Issuer
Order is timely and the Notes have not been previously disposed of by the
Trustee.
SECTION 2.9 RELEASE OF COLLATERAL. The Trustee shall, on or after the
later of (i) the Termination Date and (ii) the date upon which all Issuer
Secured Obligations have been satisfied, release any remaining portion of the
Trust Estate from the lien created by this Indenture and deposit in the
Collection Account any funds then on deposit in any other Trust Account. The
Trustee shall release property from the lien created by this Indenture pursuant
to this Section 2.9 only upon receipt of an Issuer Request accompanied by an
Officer's Certificate and an Opinion of Counsel meeting the applicable
requirements of Section 11.1.
SECTION 2.10 BOOK-ENTRY NOTES. The Notes, upon original issuance, will
be issued in the form of typewritten Notes representing the Book-Entry Notes, to
be delivered to DTC or to the Trustee as custodian for the initial Clearing
Agency, by, or on behalf of, the Issuer. Such Notes shall initially be
registered on the Note Register in the name of Cede & Co., the nominee of the
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initial Clearing Agency, and no Note Owner will receive a Definitive Note
representing such Note Owner's interest in such Note, except as provided in
Section 2.12. Unless and until definitive, fully registered Notes (the
"Definitive Notes") have been issued to Note Owners pursuant to Section 2.12:
(i) the provisions of this Section shall be in full
force and effect;
(ii) the Note Registrar and the 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 Notes and the giving of instructions or
directions hereunder) as the sole Holder of the Notes, and
shall have no obligation to the Note Owners;
(iii) to the extent that the provisions of this
Section conflict with any other provisions of this Indenture,
the provisions of this Section 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.
Unless and until Definitive Notes are issued pursuant to
Section 2.12, the Clearing Agency will make book-entry
transfers among the Clearing Agency Participants and receive
and transmit payments of principal of and interest on the
Notes to such Clearing Agency Participants;
(v) whenever this Indenture requires or permits
actions to be taken based upon instructions or directions of
Holders of Notes evidencing a specified percentage of the
Outstanding Amount of the Notes, 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 and has delivered such instructions to
the Trustee;
(vi) Note Owners may receive copies of any reports
sent to Noteholders pursuant to this Indenture, upon written
request, together with a certification that they are Note
Owners and payment of reproduction and postage expenses
associated with the distribution of such reports, from the
Trustee at the Corporate Trust Office; and
(vii) Note Owners may only hold positions in the
Book-Entry Notes in minimum denominations of $25,000.
SECTION 2.11 NOTICES TO CLEARING AGENCY. Whenever a notice or other
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to Note Owners pursuant to Section
2.12, the Trustee shall give all such notices and communications specified
herein to be given to Holders of the Notes to the Clearing Agency and shall have
no obligation to deliver such notices or communications to the Note Owners.
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SECTION 2.12 DEFINITIVE NOTES. If (i) the Servicer advises the Trustee
in writing that the Clearing Agency is no longer willing or able to properly
discharge its responsibilities with respect to the Notes, and the Servicer is
unable to locate a qualified successor, (ii) the Servicer at its option advises
the 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, Note
Owners representing beneficial interests aggregating at least a majority of the
Outstanding Amount of the Notes advise the Trustee through 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 such Note Owners, then the Clearing
Agency shall notify all Note Owners and the Trustee of the occurrence of any
such event and of the availability of Definitive Notes to Note Owners requesting
the same. Upon surrender to the Trustee of the typewritten Note or Notes
representing the Book-Entry Notes by the Clearing Agency, accompanied by
registration instructions, the Issuer shall execute and the Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the 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, the Trustee shall recognize the Holders of the Definitive
Notes as Noteholders.
SECTION 2.13 RESTRICTIONS ON TRANSFER OF NOTES
(a) The Notes have not been registered or qualified under the
Securities Act of 1933, as amended (the "1933 Act"), or any State securities
laws or "Blue Sky" laws, and the Notes are being offered and sold in reliance
upon exemptions from the registration requirements of the 1933 Act and such Blue
Sky or State securities laws. No transfer, sale, pledge or other disposition of
any Note shall be made unless such disposition is made pursuant to an effective
registration statement under the 1933 Act and effective registration or
qualification under applicable State securities laws or "Blue Sky" laws, or is
made in a transaction which does not require such registration or qualification.
In the event that a transfer of an Ownership Interest in a Book-Entry Note is to
be made in reliance upon an exemption from the 1933 Act, the transferee will be
deemed to have made the same representations and warranties as required of an
initial purchaser of such Ownership Interest, as set forth in Section 2.13(b)
below. In the event that a transfer of an Ownership Interest in a Note which is
not a Book-Entry Note is to be made in reliance upon an exemption from the 1933
Act, the Trustee or the Note Registrar shall require, in order to assure
compliance with the 1933 Act, that the Noteholder desiring to effect such
disposition and such Noteholder's prospective transferee each (A) certify to the
Trustee or the Note Registrar in writing the facts surrounding such disposition
pursuant to a letter, substantially in the form of EXHIBIT B hereto, or (B)
provide to the Trustee or the Note Registrar such other evidence satisfactory to
the Transferor, the Trustee and the Note Registrar that the transfer is in
compliance with the 1933 Act. The Trustee may also, unless such transfer occurs
more than three years after the Closing Date or is made pursuant to Rule 144A
promulgated under the 1933 Act, require an opinion of counsel satisfactory to it
that such transfer may be made pursuant to an exemption from the 1933 Act, which
opinion of counsel shall not be an expense of the Trustee. None of the Seller,
the Servicer, the Issuer, the Owner Trustee or the Trustee is obligated under
this Indenture to register the Notes under the 1933 Act or any other securities
law or to take any action not otherwise required under this Indenture to permit
the transfer of such Notes without such registration or qualification.
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Notwithstanding the foregoing, any transfer of a Note from a
Noteholder to the Seller or an Affiliate of the Seller shall be deemed
to have been made pursuant to an exemption from the registration
requirements of the 1933 Act, applicable State securities laws and
"Blue Sky" laws, and none of the conditions precedent set forth in this
Section 2.13(a) to the transfer of the Notes shall be applicable to
such transfer and such transferee shall not be deemed to have made the
representations and warranties in Section 2.13(b).
(b) Each Person (other than the Seller or an Affiliate of the Seller)
who has or who acquires an Ownership Interest in a Book-Entry Note in reliance
upon an exemption from the 1933 Act shall be deemed by the acceptance or
acquisition of such Ownership Interest to have represented and agreed, as
follows:
(i) Such Person is a qualified institutional buyer as
defined in Rule 144A under the 1933 Act, is aware that the
seller of the Note may be relying on the exemption from the
registration requirements of the 1933 Act provided by Rule
144A and is acquiring such Note for its own account, for the
account of one or more qualified institutional buyers for whom
it is authorized to act.
(ii) Such Person understands that the Notes have not
been and will not be registered under the 1933 Act and may be
offered, sold, pledged or otherwise transferred only to a
person whom the seller reasonably believes is a qualified
institutional buyer in a transaction meeting the requirements
of Rule 144A under the 1933 Act and in accordance with any
applicable securities laws of any State.
(iii) Such Person understands that a single
certificate in respect of each Class of Notes has been
registered in the name of the nominee of DTC, or in the case
of Definitive Notes, such Definitive Notes have been
registered in the name of such Person or its nominee, and
bears a legend to the following effect:
"THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"1933 ACT"), OR THE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES ("BLUE SKY LAWS"), AND THIS NOTE
MAY NOT BE OFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT (A) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A UNDER THE 1933
ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (B) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE 1933 ACT, (C) PURSUANT TO AN
EXEMPTION FROM REGISTRATION PROVIDED UNDER THE 1933
ACT (IF AVAILABLE), OR (D) TO THE SELLER OR AN
AFFILIATE OF THE SELLER, IN EACH CASE IN ACCORDANCE
WITH THE INDENTURE AND ALL APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES OR ANY OTHER
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APPLICABLE JURISDICTION. NO REPRESENTATION IS MADE AS
TO THE AVAILABILITY OF THE EXEMPTION PROVIDED BY RULE
144A FOR RESALES OF THIS NOTE."
(c) The Issuer shall provide to any Noteholder and any prospective
transferee designated by any such Noteholder, information regarding the Notes,
the Trust Estate and such other information as shall be necessary to satisfy the
condition to eligibility set forth in Rule 144A(d)(4) for transfer of any such
Note without registration thereof under the Securities Act pursuant to the
registration exemption provided by Rule 144A. The Trustee shall cooperate with
the Issuer in providing the Rule 144A information referenced in the preceding
sentence, including providing to the Issuer such information regarding the
Notes, the Trust Estate and other matters as the Issuer shall reasonably request
to meet its obligation under the preceding sentence. Each Noteholder desiring to
effect such transfer shall, and does hereby agree to, indemnify the Issuer and
the Trustee against any liability that may result if the transfer is not so
exempt or is not made in accordance with such Federal and State laws.
ARTICLE III
COVENANTS
---------
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The Issuer will duly and
punctually pay the principal of and interest on the Notes in accordance with the
terms of the Notes and this Indenture. Without limiting the foregoing, the
Issuer will cause to be distributed on each Payment Date all amounts deposited
in the Note Distribution Account pursuant to the Sale and Servicing Agreement
(i) for the benefit of the Class A-1 Notes, to the Class A-1 Noteholders, (ii)
for the benefit of the Class A-2 Notes, to the Class A-2 Noteholders, (iii) for
the benefit of the Class A-3 Notes, to the Class A-3 Noteholders and (iv) for
the benefit of the Class A-4 Notes, to the Class A-4 Noteholders. Amounts
properly withheld under the Code or any applicable State law 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 will maintain
in Minneapolis, Minnesota, 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 Trustee to serve as its agent for the
foregoing purposes. The Issuer will give prompt written notice to the 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 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 Trustee as its agent to receive all such surrenders,
notices and demands.
SECTION 3.3 MONEY FOR PAYMENTS TO BE HELD IN TRUST.
(a) On or before each Payment Date and Redemption Date, the Issuer
shall deposit or cause to be deposited in the Note Distribution Account from the
Collection Account an aggregate sum sufficient to pay the amounts then becoming
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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 Trustee) shall
promptly notify the Trustee of its action or failure so to act.
(b) The Issuer shall cause each Note Paying Agent other than the
Trustee to execute and deliver to the Trustee and the Note Insurer an instrument
in which such Note Paying Agent shall agree with the Trustee (and if the Trustee
acts as Note Paying Agent, it hereby so agrees), subject to the provisions of
this Section, 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 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 Trustee, forthwith
pay to the 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 Trustee all sums held by it in trust for
the payment of Notes if at any time it ceases to 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 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.
(c) 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 Trustee all sums held in trust
by such Note Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which the sums were held by such Note Paying Agent; and
upon such a payment by any Note Paying Agent to the Trustee, such Note Paying
Agent shall be released from all further liability with respect to such money.
(d) Subject to applicable laws with respect to the escheat of funds,
any money held by the 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 years
after such amount has become due and payable shall be discharged from such trust
and be paid to the Issuer on Issuer Request with the consent of the Note Insurer
(unless an Insurer Default shall have occurred and be continuing) and shall be
deposited by the Trustee in the Collection Account; and the Holder 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),
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and all liability of the Trustee or such Note Paying Agent with respect to such
trust money shall thereupon cease; provided, however, that if such money or any
portion thereof had been previously deposited by the Note Insurer with the
Trustee for the payment of principal or interest on the Notes, to the extent any
amounts are owing to the Note Insurer, such amounts shall be paid promptly to
the Note Insurer upon receipt of a written request by the Note Insurer to such
effect, and provided, further, that the Trustee or such Note Paying Agent,
before being required to make any such repayment, shall at the expense 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 30 days from the
date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Issuer. The Trustee shall also adopt and employ, at the
expense of the Issuer, any other reasonable means of notification of such
repayment (including mailing notice of such repayment to Holders whose Notes
have been called but have not been surrendered for redemption or whose right to
or interest in moneys due and payable but not claimed is determinable from the
records of the Trustee or of any Note Paying Agent, at the last address of
record for each such Holder).
SECTION 3.4 EXISTENCE. Except as otherwise permitted by the provisions
of Section 3.10, the Issuer will keep in full effect its existence, rights and
franchises as a statutory 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 will keep in full effect its existence, rights and franchises under the
laws of such other jurisdiction) and will obtain and preserve its qualification
to do business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Indenture, the
Notes, the Collateral and each other instrument or agreement included in the
Trust Estate.
SECTION 3.5 PROTECTION OF TRUST ESTATE. The Issuer intends the security
interest Granted pursuant to this Indenture in favor of the Trustee for the
benefit of the Issuer Secured Parties to be prior to all other liens in respect
of the Trust Estate, and the Issuer shall take all actions necessary to obtain
and maintain, in favor of the Trustee, for the benefit of the Issuer Secured
Parties, a first lien on and a first priority, perfected security interest in
the Trust Estate. The Issuer will from time to time prepare (or shall cause to
be prepared), execute and deliver all such supplements and amendments hereto and
all such financing statements, continuation statements, instruments of further
assurance and other instruments, and will take such other action necessary or
advisable to:
(i) Grant more effectively all or any portion of the
Trust Estate;
(ii) maintain or preserve the lien and security
interest (and the priority thereof) in favor of the Trustee
for the benefit of the Issuer Secured Parties created by this
Indenture or carry out more effectively the purposes hereof;
(iii) perfect, publish notice of or protect the
validity of any Grant made or to be made by this Indenture;
(iv) enforce any of the Collateral;
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(v) preserve and defend title to the Trust Estate and
the rights of the Trustee in such Trust Estate against the
claims of all persons and parties; and
(vi) pay all taxes or assessments levied or assessed
upon the Trust Estate when due.
The Issuer hereby designates the Trustee its agent and attorney-in-fact
to execute any financing statement, continuation statement or other instrument
required by the Trustee pursuant to this Section.
SECTION 3.6 OPINIONS AS TO TRUST ESTATE.
(a) On the Closing Date, and on the date of execution of each indenture
supplemental hereto, the Issuer shall furnish to the Trustee and the Note
Insurer 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 filing of any financing statements and
continuation statements, as are necessary to perfect and make effective the
first priority lien and security interest in favor of the Trustee in the
Receivables, for the benefit of the Issuer Secured Parties, 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 make such lien and
security interest effective.
(b) Within 90 days after the beginning of each calendar year,
commencing in 2009, the Issuer shall furnish to the Trustee and the Note Insurer
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
re-filing of this Indenture, any indentures supplemental hereto and any other
requisite documents and with respect to the filing of any financing statements
and continuation statements as are necessary to maintain the first priority lien
and security interest created by this Indenture in the Receivables 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 any action necessary (as of the date of
such opinion) to be taken in the following year to maintain the lien and
security interest of this Indenture.
SECTION 3.7 PERFORMANCE OF OBLIGATIONS; SERVICING OF RECEIVABLES.
(a) The Issuer will not take any action and will 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 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 ordered by any
bankruptcy or other court or as expressly provided in this Indenture, the Basic
Documents or such other instrument or agreement.
(b) The Issuer may contract with other Persons acceptable to the Note
Insurer (so long as no Insurer Default shall have occurred and be continuing) to
assist it in performing its duties under this Indenture, and any performance of
such duties by a Person identified to the Trustee and the Note Insurer 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 to assist the
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Issuer in performing its duties under this Indenture.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents and
in the instruments and agreements included in the Trust Estate, including
preparing (or causing to be prepared) and filing (or causing to be filed) all
UCC financing statements and continuation statements required to be filed 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 Trustee, the Note Insurer or, if an Insurer Default has occurred
and is continuing, a Note Majority.
(d) If a responsible officer of the Owner Trustee shall have written
notice or actual knowledge of the occurrence of a Servicer Termination Event
under the Sale and Servicing Agreement, the Issuer shall promptly notify the
Trustee, the Note Insurer and the Rating Agencies thereof in accordance with
Section 11.4, and shall specify in such notice the action, if any, the Issuer is
taking in respect of such default. If a Servicer Termination Event 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) The Issuer agrees that it will not waive timely performance or
observance by the Servicer or the Seller of their respective duties under the
Basic Documents (x) without the prior consent of the Note Insurer (unless an
Insurer Default shall have occurred and be continuing) or (y) if the effect
thereof would adversely affect the Holders of the Notes.
SECTION 3.8 NEGATIVE COVENANTS. So long as any Notes are Outstanding,
the Issuer shall not:
(i) except as expressly permitted by this Indenture
or the Basic Documents, sell, transfer, exchange or otherwise
dispose of any of the properties or assets of the Issuer,
including those included in the Trust Estate, without the
satisfaction of the Rating Agency Condition and unless
directed to do so by the Controlling Party or unless the
Controlling Party has approved such disposition;
(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 any part of the Trust Estate; or
(iii) (A) permit the validity or effectiveness of
this Indenture to be impaired, or permit the lien in favor of
the Trustee created by 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 or
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any other Basic Document except as may be expressly permitted
hereby or thereby, (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 Trust Estate, any
Collateral 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 a
Financed Vehicle and arising solely as a result of an action
or omission of the related Obligor), (C) permit the lien of
this Indenture not to constitute a valid first priority (other
than with respect to any such tax, mechanics' or other lien)
perfected security interest in the Trust Estate or any
Collateral; or (D) amend, modify or fail to comply with the
provisions of the Basic Documents without the prior written
consent of the Controlling Party, and if such amendments or
modifications would adversely affect the interests of any
Noteholder in any material respect, the consent of such
Noteholder or the satisfaction of the Rating Agency Condition;
or
(iv) engage in any business or activity other than as
permitted by the Trust Agreement; or
(v) incur or assume any indebtedness or guarantee any
indebtedness of any Person, except for such indebtedness
incurred pursuant to Section 3.15; or
(vi) dissolve or liquidate in whole or in part or
merge or consolidate with any other Person, other than in
compliance with Section 3.10; or
(vii) take any action that would result in the Issuer
becoming taxable as a corporation for federal income tax
purposes or for the purposes of any applicable State tax.
SECTION 3.9 ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer will deliver
to the Trustee and the Note Insurer, on or before March 31 of each year,
beginning March 31, 2009, an Officer's Certificate, dated as of December 31 of
the preceding calendar year, stating, as to the Authorized Officer signing such
Officer's Certificate, that
(i) a review of the activities of the Issuer during
such preceding year (or, in the case of the first such
Officer's Certificate, since the Closing Date) 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, in the case of the first such Officer's
Certificate, since the Closing Date), or, if there has been a
default in the compliance of 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:
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(i) the Person (if other than the Issuer) formed by
or surviving such consolidation or merger shall be a Delaware
Statutory Trust or a similar trust organized and existing
under the laws of any other State and shall expressly assume,
by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee and the Note
Insurer (so long as no Insurer Default shall have occurred and
be continuing), 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;
(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
Trustee and the Note Insurer (so long as no Insurer Default
shall have occurred and be continuing)) to the effect that
such transaction will not have any material adverse tax
consequence to the Trust, the Note Insurer, any Noteholder or
any Certificateholder;
(v) any action as is necessary to maintain the lien
and security interest created by this Indenture shall have
been taken;
(vi) the Issuer shall have delivered to the Trustee
and the Note Insurer 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; and
(vii) so long as no Insurer Default shall have
occurred and be continuing, the Issuer shall have given the
Note Insurer written notice of such consolidation or merger at
least 20 Business Days prior to the consummation of such
action and shall have received the prior written approval of
the Note Insurer of such consolidation or merger and the
Issuer or the Person (if other than the Issuer) formed by or
surviving such consolidation or merger has a net worth,
immediately after such consolidation or merger, that is (a)
greater than zero and (b) not less than the net worth of the
Issuer immediately prior to giving effect to such
consolidation or merger.
(b) The Issuer shall not convey or transfer all or substantially all of
its properties or assets, including those included in the 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 Delaware Statutory Trust or a similar trust organized and
existing under the laws of any other State, (B) expressly
assume, by an indenture supplemental hereto, executed and
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delivered to the Trustee, in form satisfactory to the Trustee,
and the Note Insurer (so long as no Insurer Default shall have
occurred and be continuing), 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 and each of the Basic Documents on the part of the
Issuer to be performed or observed, all as provided herein,
(C) expressly agree 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 Holders of
the Notes, (D) unless otherwise provided in such supplemental
indenture, expressly agree 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 agree by means of such supplemental
indenture that such Person (or if a group of persons, then one
specified Person) shall prepare (or cause to be prepared) and
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
Trustee and the Note Insurer (so long as no Insurer Default
shall have occurred and be continuing)) to the effect that
such transaction will not have any material adverse tax
consequence to the Trust, the Note Insurer, any Noteholder or
any Certificateholder;
(v) any action as is necessary to maintain the lien
and security interest created by this Indenture shall have
been taken;
(vi) the Issuer shall have delivered to the Trustee
and the Note Insurer an Officers' Certificate and an Opinion
of Counsel each stating that such conveyance or transfer 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; and
(vii) so long as no Insurer Default shall have
occurred and be continuing, the Issuer shall have given the
Note Insurer written notice of such conveyance or transfer at
least 20 Business Days prior to the consummation of such
action and shall have received the prior written approval of
the Note Insurer of such conveyance or transfer and the Issuer
or the Person (if other than the Issuer) formed by or
surviving such conveyance or transfer has a net worth,
immediately after such conveyance or transfer, that is (a)
greater than zero and (b) not less than the net worth of the
Issuer immediately prior to giving effect to such conveyance
or transfer.
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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), CPS Auto Receivables Trust 2008-A will
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 Trustee stating that CPS Auto
Receivables Trust 2008-A is to be so released.
SECTION 3.12 NO OTHER BUSINESS. The Issuer shall not engage in any
business other than financing, purchasing, owning, selling and managing the
Receivables in the manner contemplated by this Indenture and the Basic Documents
and activities incidental thereto. After the end of the Funding Period, the
Issuer will not purchase any additional Receivables.
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 (i) the Notes (ii) obligations owing from time to time
to the Note Insurer under the Insurance Agreement and (iii) any other
Indebtedness permitted by or arising under the Basic Documents. The proceeds of
the Notes shall be used exclusively to fund the Issuer's purchase of the
Receivables and the other assets specified in the Sale and Servicing Agreement,
to fund (on behalf of the Seller) the Series 2008-A Spread Account and to pay
the Issuer's organizational, transactional and start-up expenses.
SECTION 3.14 SERVICER'S OBLIGATIONS. The Issuer shall cause the
Servicer to comply with Sections 4.9, 4.10, 4.11 and 5.11 of the Sale and
Servicing Agreement.
SECTION 3.15 GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES. Except
as contemplated by the 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), 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 COMPLIANCE WITH LAWS. The Issuer shall comply with the
requirements of all applicable laws, the non-compliance with which would,
individually or in the aggregate, materially and adversely affect the ability of
the Issuer to perform its obligations under the Notes, this Indenture or any
other Basic Document.
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SECTION 3.18 RESTRICTED PAYMENTS. The Issuer shall not, directly or
indirectly, (i) pay any dividend or 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, (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, distributions
to the Servicer, the Owner Trustee, the Trustee, the Collateral Agent, the
Backup Servicer, the Note Insurer, the Noteholders and the Certificateholders as
permitted by, and to the extent funds are available for such purpose under, the
Sale and Servicing Agreement, the Master Spread Account Agreement, the Trust
Agreement or any other Basic Document. The Issuer will not, directly or
indirectly, make payments to or distributions from the Collection Account except
in accordance with this Indenture and the Basic Documents.
SECTION 3.19 NOTICE OF EVENTS OF DEFAULT. Upon a responsible officer of
the Owner Trustee having notice or actual knowledge thereof, the Issuer agrees
to give the Trustee, the Note Insurer and the Rating Agencies prompt written
notice of each Event of Default hereunder and each default on the part of the
Servicer or the Seller of its obligations under any of the Basic Documents.
SECTION 3.20 FURTHER INSTRUMENTS AND ACTS. Upon request of the Trustee
or the Note Insurer, the Issuer will 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 3.21 AMENDMENTS OF SALE AND SERVICING AGREEMENT AND TRUST
AGREEMENT. The Issuer shall not agree to any amendment to Section 13.1 of the
Sale and Servicing Agreement or Section 11.1 of the Trust Agreement to eliminate
the requirements thereunder that the Trustee, the Note Insurer or the Holders of
the Notes consent to amendments thereto as provided therein.
SECTION 3.22 INCOME TAX CHARACTERIZATION. For purposes of federal
income tax, State and local income tax, franchise tax and any other income
taxes, the Issuer and each Noteholder, by its acceptance of its Note or in the
case of a Note Owner, by its acceptance of a beneficial interest in a Note, will
treat the Notes as indebtedness of the Issuer and hereby instructs the Trustee
to treat the Notes as indebtedness of the Issuer for federal and State tax
reporting purposes.
SECTION 3.23 SEPARATE EXISTENCE OF THE ISSUER. During the term of this
Indenture, the Issuer shall observe the applicable legal requirements for the
recognition of the Issuer as a legal entity separate and apart from its
Affiliates, including as follows:
(a) The Issuer shall maintain business records and books of account
separate from those of its Affiliates;
(b) Except as otherwise provided in the Basic Documents, the Issuer
shall not commingle its assets and funds with those of its Affiliates;
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(c) The Issuer shall at all times hold itself out to the public under
the Issuer's own name as a legal entity separate and distinct from its
Affiliates; and
(d) All transactions and dealings between the Issuer and its Affiliates
will be conducted on an arm's-length basis.
SECTION 3.24 REPRESENTATIONS AND WARRANTIES OF THE ISSUER.
The Issuer hereby makes the following representations and
warranties as to the Trust Estate to the Note Insurer and the Trustee for the
benefit of the Noteholders:
(i) CREATION OF SECURITY INTEREST. This Indenture
creates a valid and continuing security interest (as defined
in the UCC) in the Trust Estate in favor of the Trustee for
the benefit of the Issuer Secured Parties, which security
interest is prior to all other Liens (except, as to priority,
for any tax liens or mechanics' lien which may arise after the
Closing Date or as a result of an Obligor's failure to pay its
obligations, as applicable) and is enforceable as such as
against creditors of and purchasers from the Issuer.
(ii) PERFECTION OF SECURITY INTEREST IN TRUST
PROPERTY. The Issuer has caused, on or prior to the Closing
Date, the filing of all appropriate financing statements in
the proper filing office in the appropriate jurisdictions
under applicable law in order to perfect the security interest
in the Trust Estate Granted to the Trustee for the benefit of
the Issuer Secured Parties hereunder.
(iii) NO OTHER SECURITY INTERESTS. Other than the
security interest Granted to the Trustee for the benefit of
the Issuer Secured Parties hereunder, the Issuer has not
pledged, assigned, sold, granted a security interest in, or
otherwise conveyed any of the Trust Estate. The Issuer has not
authorized the filing of and is not aware of any financing
statements filed against the Issuer that include a description
of collateral covering the Trust Estate other than any
financing statement relating to the security interest Granted
to the Trustee for the benefit of the Issuer Secured Parties
hereunder or that has been terminated. The Issuer is not aware
of any judgment or tax lien filings against the Issuer.
(iv) NOTATIONS ON CONTRACTS; FINANCING STATEMENT
DISCLOSURE. The Servicer has in its possession copies of all
the original Contracts that constitute or evidence the
Receivables. The Contracts that constitute or evidence the
Receivables do not and will not have any marks or notations
indicating that they have been pledged, assigned or otherwise
conveyed to any Person other than the Issuer and/or the
Trustee for the benefit of the Issuer Secured Parties. All
financing statements filed or to be filed against the Issuer
in favor of the Trustee in connection herewith describing the
Trust Estate contain a statement to the following effect: "A
purchase of or security interest in any collateral described
in this financing statement will violate the rights of Xxxxx
Fargo Bank, National Association, as Trustee and secured
party."
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(v) TITLE. Immediately prior to the Grant herein
contemplated, the Issuer had good and marketable title to each
Receivable and the other property Granted hereunder and was
the sole owner thereof, free and clear of all liens, claims,
encumbrances, security interests, and rights of others, and,
immediately upon the transfer thereof, the Trustee for the
benefit of the Issuer Secured Parties shall have good and
marketable title to each such Receivable and other property
and will be the sole owner thereof, free and clear of all
liens, encumbrances, security interests, and rights of others,
and the transfer has been perfected under the UCC.
The representations and warranties of the Issuer in this Section 3.24
may not be waived, modified or amended in any material respect without the prior
written consent of the Trustee, the Note Insurer and the Rating Agencies, and
shall survive the satisfaction and discharge of this Indenture.
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 2.9, 3.3, 3.4, 3.5,
3.8, 3.10, 3.12, 3.13, 3.20, 3.21, 3.22 and 11.17, (v) the rights, obligations
and immunities of the Trustee hereunder (including the rights of the Trustee
under Section 6.7 and the obligations of the Trustee under Section 4.2) and (vi)
the rights of Noteholders as beneficiaries hereof with respect to the property
so deposited with the Trustee payable to all or any of them, and the 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) 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 2.5 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 Trustee for cancellation and
the Note Policy has expired and been returned to the Note Insurer for
cancellation;
(b) the Issuer has paid or caused to be paid all Insurer Secured
Obligations and all Trustee Secured Obligations; and
(c) the Issuer has delivered to the Trustee and the Note Insurer an
Officer's Certificate and an Opinion of Counsel, each meeting the applicable
requirements of Section 11.1(a) and each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this Indenture
have been complied with.
SECTION 4.2 APPLICATION OF TRUST MONEY. All moneys deposited with the
Trustee pursuant to Section 4.1 hereof 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 Trustee may
determine, to the Holders of the particular Notes for the payment or redemption
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of which such moneys have been deposited with the Trustee, of all sums due and
to become due thereon for principal and interest; but such moneys 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 4.3 REPAYMENT OF MONEYS HELD BY NOTE PAYING AGENT. In
connection with the satisfaction and discharge of this Indenture with respect to
the Notes, all moneys then held by any Note Paying Agent other than the Trustee
under the provisions of this Indenture with respect to such Notes shall, upon
demand of the Issuer, be paid to the 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 moneys.
ARTICLE V
REMEDIES
--------
SECTION 5.1 EVENTS OF DEFAULT.
(a) "Event of Default", wherever used herein, means 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) so long as an Insurer Default shall have occurred
and be continuing, default in the payment of any interest on
any Note when the same becomes due and payable, and such
default shall continue for a period of five days (solely for
purposes of this clause, a payment on the Notes funded by the
Note Insurer or the Collateral Agent from the Series 2008-A
Spread Account shall be deemed to be a payment made by the
Issuer); or
(ii) so long as an Insurer Default shall have
occurred and be continuing, default in the payment of the
principal of or any installment of the principal of any Note
when the same becomes due and payable and such default shall
continue for a period of five days (solely for purposes of
this clause, a payment on the Notes funded by the Note Insurer
or the Collateral Agent from the Series 2008-A Spread Account
shall be deemed to be a payment made by the Issuer); or
(iii) so long as no Insurer Default shall have
occurred and be continuing, an Insurance Agreement Indenture
Cross Default shall have occurred; provided, however, that the
occurrence of an Insurance Agreement Indenture Cross Default
may not form the basis of an Event of Default unless the Note
Insurer shall, upon prior written notice to the Rating
Agencies, have delivered to the Issuer and the Trustee and not
rescinded a written notice specifying that such Insurance
Agreement Indenture Cross Default constitutes an Event of
Default under this Indenture; or
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(iv) so long as an Insurer Default shall have
occurred and be continuing, a default in the observance or
performance of any 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 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 30 days
(or for such longer period, not in excess of 90 days, as may
be reasonably necessary to remedy such default; provided that
such default is capable of remedy within 90 days or less and
the Servicer on behalf of the Owner Trustee delivers an
Officer's Certificate to the Trustee to the effect that the
Issuer has commenced, or will promptly commence and diligently
pursue, all reasonable efforts to remedy such default) after
there shall have been given, by registered or certified mail,
to the Issuer by the Trustee or to the Issuer and the Trustee
by the Holders of at least 25% of the Outstanding Amount of
each class of Notes, 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
(v) so long as an Insurer Default shall have occurred
and be continuing, the occurrence of an Insolvency Event with
respect to the Issuer, the Servicer or the Seller (or, so long
as CPS is Servicer, any Specified Affiliate).
(b) The Issuer shall deliver to the Trustee and the Note Insurer,
within five 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), its status and what
action the Issuer is taking or proposes to take with respect thereto.
SECTION 5.2 RIGHTS UPON EVENT OF DEFAULT.
(a) So long as no Insurer Default has occurred and is continuing, if an
Event of Default shall have occurred and be continuing, then the Controlling
Party shall have the right, but not the obligation, upon prior written notice to
each Rating Agency, to declare by written notice to the Issuer and the Trustee
that the Notes become immediately due and payable, and upon any such declaration
the unpaid principal amount of the Notes, together with accrued and unpaid
interest thereon, shall become immediately due and payable. The Trustee will
have no discretion with respect to the acceleration of the Notes under the
foregoing circumstances. If an Event of Default shall have occurred and be
continuing, the Controlling Party may exercise any of the remedies specified in
Section 5.4. In the event of any acceleration of the Notes, the Trustee shall
continue to make claims under the Note Policy pursuant to the Sale and Servicing
Agreement for Scheduled Payments on the Notes. Subject to the terms of the Note
Policy, payments under the Note Policy following acceleration of any Notes shall
be applied by the Trustee:
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FIRST: to Noteholders for amounts due and
unpaid on the Notes for interest, ratably, without
preference or priority of any kind, according to the
amounts due and payable on the Notes for interest;
SECOND: to the Noteholders for amounts due
and unpaid on the Notes for principal, ratably and
without preference or priority of any kind, according
to the amounts then due and payable on the Notes for
principal.
(b) In the event any Notes are accelerated due to an Event of Default,
the Note Insurer shall have the right (in addition to its obligation to pay
Scheduled Payments on the Notes in accordance with the Note Policy), but not the
obligation, to make payments under the Note Policy or otherwise of interest and
principal due on such Notes, in whole or in part, on any date or dates following
such acceleration as the Note Insurer, in its sole discretion, shall elect.
(c) If an Insurer Default shall have occurred and be continuing and an
Event of Default shall have occurred and be continuing, the Trustee in its
discretion may, or if so requested in writing by a Note Majority shall, declare
by written notice to the Issuer that the Notes become, whereupon they shall
become, immediately due and payable at par, together with accrued interest
thereon.
(d) At any time after such declaration of acceleration of maturity has
been made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter provided in this Article V, the Note
Insurer in its sole discretion, or if an Insurer Default has occurred and is
continuing, a Note Majority, by written notice to the Issuer and the Trustee,
may rescind and annul such declaration and its consequences if:
(i) the Issuer has paid or deposited with the 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 Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee and its
agents and counsel; and
(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 5.13.
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
TRUSTEE.
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(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 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 and such default continues for a period of five days,
the Issuer will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of the Notes, 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 Interest Rate 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 Trustee and its agents and counsel.
(b) Each Issuer Secured Party hereby irrevocably and unconditionally
appoints the Controlling Party as the true and lawful attorney-in-fact of such
Issuer Secured Party for so long as such Issuer Secured Party is not the
Controlling Party, with full power of substitution, to execute, acknowledge and
deliver any notice, document, certificate, paper, pleading or instrument and to
do in the name of the Controlling Party as well as in the name, place and stead
of such Issuer Secured Party such acts, things and deeds for or on behalf of and
in the name of such Issuer Secured Party under this Indenture (including
specifically under Section 5.4) and under the Basic Documents which such Issuer
Secured Party could or might do or which may be necessary, desirable or
convenient in such Controlling Party's sole discretion to effect the purposes
contemplated hereunder and under the Basic Documents and, without limitation,
following the occurrence of an Event of Default, exercise full right, power and
authority to take, or defer from taking, any and all acts with respect to the
administration, maintenance or disposition of the Trust Estate.
(c) If an Event of Default occurs and is continuing, the Trustee may in
its discretion subject to the consent of the Controlling Party and shall, at the
direction of the Controlling Party, proceed to protect and enforce its rights
and the rights of the Noteholders by such appropriate Proceedings as the Trustee
or the Controlling Party 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
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 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 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 Trustee shall have made any demand
pursuant to the provisions of this Section, subject to the direction of the
Controlling Party, shall be entitled and empowered, by intervention in such
proceedings or otherwise:
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(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
Trustee (including any claim for reasonable compensation to
the Trustee and each predecessor Trustee, and their respective
agents, attorneys and counsel, and for reimbursement of all
expenses and liabilities incurred, and all advances made, by
the Trustee and each predecessor Trustee, except as a result
of negligence, bad faith or willful misconduct) and of the
Noteholders allowed in such proceedings;
(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of Notes in any
election of a trustee, a standby trustee or person performing
similar functions in any such proceedings;
(iii) to collect and receive any moneys or other
property payable or deliverable on any such claims and to
distribute all amounts received with respect to the claims of
the Noteholders and of the 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 Trustee or the Holders of Notes 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 Trustee, and, in the event
that the Trustee shall consent to the making of payments directly to
such Noteholders, to pay to the Trustee such amounts as shall be
sufficient to cover reasonable compensation to the Trustee, each
predecessor Trustee and their respective agents, attorneys and counsel,
and all other expenses and liabilities incurred, and all advances made,
by the Trustee and each predecessor Trustee except as a result of
negligence or bad faith.
(e) Nothing herein contained shall be deemed to authorize the 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 Holder thereof or to authorize the
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.
(f) All rights of action and of asserting claims under this Indenture,
the Master Spread Account Agreement, any other Basic Document or under any of
the Notes, may be enforced by the 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 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 Trustee, each predecessor Trustee and their respective agents and
attorneys, shall be for the ratable benefit of the Holders of the Notes.
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(g) In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture, the Master
Spread Account Agreement or any other Basic Document), the Trustee shall be held
to represent all the Holders of the Notes, and it shall not be necessary to make
any Noteholder a party to any such proceedings.
SECTION 5.4 REMEDIES. If an Event of Default shall have occurred and be
continuing, the Controlling Party may do one or more of the following (subject
to Section 5.5):
(i) institute or direct the Trustee to 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
moneys adjudged due;
(ii) institute or direct the Trustee to institute
Proceedings from time to time for the complete or partial
foreclosure of this Indenture with respect to the Trust
Estate;
(iii) exercise or direct the Trustee to 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 Trustee and the Issuer Secured Parties; and
(iv) sell or direct the Trustee to sell the 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 if the
Trustee (acting at the direction of Noteholders) is the
Controlling Party, the Trustee may not sell or otherwise
liquidate the Trust Estate following an Event of Default
unless (A) such Event of Default is of the type described in
Section 5.1(i) or (ii) or (B) either (x) the Holders of 100%
of the Outstanding Amount of the Notes consent thereto, or (y)
the proceeds of such sale or liquidation distributable to the
Noteholders are sufficient to discharge in full all amounts
then due and unpaid upon such Notes for principal and
interest.
In determining such sufficiency or insufficiency with respect to clause
(y), the 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 Trust
Estate for such purpose.
SECTION 5.5 OPTIONAL PRESERVATION OF THE RECEIVABLES. If the Trustee
(acting at the direction of Noteholders) is the Controlling Party and 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 Trustee may, but need not, elect to maintain
possession of the Trust Estate. It is the desire of the parties hereto and the
Noteholders that there be at all times sufficient funds for the payment of
principal of and interest on the Notes and amounts due to the Note Insurer, and
the Trustee shall take such desire into account when determining whether or not
to maintain possession of the Trust Estate. In determining whether to maintain
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possession of the Trust Estate, the 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 Trust Estate for such purpose.
SECTION 5.6 PRIORITIES.
(a) Following (1) the acceleration of the Notes pursuant to Section 5.2
or (2) if an Insurer Default shall have occurred and be continuing, the
occurrence of an Event of Default pursuant to Section 5.1(a)(i), 5.1(a)(ii) or
5.1(a)(v) of this Indenture, the Total Distribution Amount, including any money
or property collected pursuant to Section 5.4 of this Indenture shall be applied
by the Trustee on the related Payment Date in the following order of priority:
FIRST: amounts due and owing and
required to be distributed pursuant to
priorities (i) through (iv) of Section
5.7(a) of the Sale and Servicing Agreement
and not previously distributed to the
Persons set forth therein, in the order of
such priorities and without preference or
priority of any kind within such priorities,
and, if applicable, subject to the monetary
limitations set forth therein;
SECOND: to the Noteholders for
amounts due and unpaid on the Notes for
interest, ratably, without preference or
priority of any kind, according to the
amounts due and payable on the Notes for
interest;
THIRD: to the Noteholders for
amounts due and unpaid on the Notes for
principal, ratably and without preference of
priority of any kind, to the Noteholders of
each Class of Notes, according to the
amounts due and payable on the Notes, until
the outstanding principal amount of the
Notes has been reduced to zero;
FOURTH: amounts due and owing and
required to be distributed to the Note
Insurer pursuant to priority (viii) of
Section 5.7(a) of the Sale and Servicing
Agreement and not previously distributed;
FIFTH: amounts due and owing and
required to be distributed to the Residual
Certificateholders, pro rata, pursuant to
priorities (vi) and (xiii) of Section 5.7(a)
of the Sale and Servicing Agreement and not
previously distributed;
SIXTH: in the event any Person
other than the Backup Servicer becomes the
successor Servicer, to such successor
Servicer, to the extent not previously paid
by the predecessor Servicer pursuant to the
Sale and Servicing Agreement, or pursuant to
priority FIRST hereof, reasonable transition
expenses (up to a maximum of $50,000 for all
such expenses during the term of this
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Indenture) incurred in becoming the
successor Servicer and all other amounts due
and owing to the Backup Servicer pursuant to
Section 5.7(a)(xii) of the Sale and
Servicing Agreement;
SEVENTH: to the Residual
Certificateholders, pro rata, in reduction
of the Residual Certificate Notional Balance
until the Residual Certificate Notional
Balance equals zero; and
EIGHTH: to the Residual
Certificateholders, pro rata, any remaining
amount.
(b) The Trustee may fix a record date and payment date for any payment
to Noteholders pursuant to this Section. At least 15 days before such record
date the Issuer shall mail to each Noteholder and the Trustee a notice that
states such record date, the payment date and the amount to be paid.
SECTION 5.7 LIMITATION OF SUITS. No Residual Certificateholder 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 while any Trustee Secured Obligations or Note Insurer
Secured Obligations remain outstanding. No Holder of any Note 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:
(i) such Holder has previously given written notice
to the Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the
Outstanding Amount of each class of Notes have made written
request to the Trustee to institute such proceeding in respect
of such Event of Default in its own name as Trustee hereunder;
(iii) such Holder or Holders have offered to the
Trustee indemnity reasonably satisfactory to it against the
costs, expenses and liabilities to be incurred in complying
with such request;
(iv) the Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed to
institute such proceedings;
(v) no direction inconsistent with such written
request has been given to the Trustee during such 60-day
period by a Note Majority; and
(vi) an Insurer Default shall have occurred and be
continuing;
it being understood and intended that no one or more Holders of Notes
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 Holders of Notes or to obtain or to seek to obtain priority or preference
over any other Holders or to enforce any right under this Indenture, except in
the manner herein provided.
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In the event an Insurer Default has occurred and is continuing and the
Trustee shall receive conflicting or inconsistent requests and indemnity from
two or more groups of Holders of Notes, each representing less than a majority
of the Outstanding Amount of each class of Notes, the Trustee in its sole
discretion may determine what action, if any, shall be taken, notwithstanding
any other provisions of this Indenture.
SECTION 5.8 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL
AND INTEREST. Notwithstanding any other provisions of this Indenture, the Holder
of any Note shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest, if any, on such 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 Holder.
SECTION 5.9 RESTORATION OF RIGHTS AND REMEDIES. If the Controlling
Party 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 Trustee or to
such Noteholder, then and in every such case the Issuer, the 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 Trustee and the Noteholders shall continue as
though no such proceeding had been instituted.
SECTION 5.10 RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein
conferred upon or reserved to the Controlling Party or to the Noteholders is
intended 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 5.11 DELAY OR OMISSION NOT A WAIVER. No delay or omission of
the Controlling Party or any Holder of any Note 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 an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Trustee or to the Noteholders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Noteholders, as the
case may be.
SECTION 5.12 CONTROL BY NOTEHOLDERS. If the Trustee (acting at the
direction of Noteholders) is the Controlling Party, a Note Majority shall have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee with respect to the Notes or exercising any
trust or power conferred on the Trustee; provided that
(i) such direction shall not be in conflict with any
rule of law or with this Indenture;
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(ii) subject to the express terms of Section 5.4, any
direction to the Trustee to sell or liquidate the Trust Estate
shall be by the Holders of Notes representing not less than
100% of the Outstanding Amount of the Notes;
(iii) if the conditions set forth in Section 5.5 have
been satisfied and the Trustee elects to retain the Trust
Estate pursuant to such Section, then any direction to the
Trustee by Holders of Notes representing less than 100% of the
Outstanding Amount of each class of Notes to sell or liquidate
the Trust Estate shall be of no force and effect; and
(iv) the Trustee may take any other action deemed
proper by the Trustee that is not inconsistent with such
direction;
provided, however, that, subject to Section 6.1, the Trustee need not
take any action that it determines might involve it in liability or might
materially adversely affect the rights of any Noteholders not consenting to such
action.
SECTION 5.13 WAIVER OF PAST DEFAULTS. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.4, the Note
Insurer or, if an Insurer Default has occurred and is continuing, a Note
Majority may waive any past Default or Event of Default and its consequences
except a Default or Event of Default (i) in payment of principal of or interest
on any of the Notes or (ii) in respect of a covenant or provision hereof which
cannot be modified or amended without the consent of the Holder of each Note. In
the case of any such waiver, the Issuer, the Trustee and the Holders of the
Notes shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or other Default
or Event of Default or impair any right consequent thereto.
Upon any such waiver, such Default or Event of 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 5.14 UNDERTAKING FOR COSTS. All parties to this Indenture
agree, and each Holder of any Note by such Holder's acceptance thereof shall be
deemed to 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 Trustee for any action taken, suffered or omitted by it as 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 shall not apply to (a)
any suit instituted by the Trustee, (b) any suit instituted by any Noteholder,
or group of Noteholders, in each case holding in the aggregate more than 10% of
the Outstanding Amount of each class of Notes 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).
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SECTION 5.15 WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants (to
the extent that it may lawfully do so) that it will 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 will not hinder,
delay or impede the execution of any power granted to the Trustee herein and any
right of the Issuer to take such action shall be suspended.
SECTION 5.16 SUBROGATION. The Note Insurer shall, to the extent it
makes any payment with respect to the Notes, become subrogated to the rights of
the recipients of such payments to the extent of such payments. Subject to and
conditioned upon any payment with respect to the Notes by or on behalf of the
Note Insurer, each Noteholder shall be deemed, without further action to have
directed the Trustee to assign to the Note Insurer all rights to the payment of
interest or principal with respect to the Notes which are then due for payment
to the extent of all payments made by the Note Insurer and the Note Insurer may
exercise any option, vote, right, power or the like with respect to the Notes to
the extent that it has made payment pursuant to the Note Policy. Notwithstanding
the foregoing, the order of priority of payments to be made pursuant to Section
5.7(a) of the Sale and Servicing Agreement shall not be modified by this clause.
To evidence such subrogation, the Note Registrar shall note the Note Insurer's
rights as subrogee upon the register of Noteholders upon receipt from the Note
Insurer of proof of payment by the Note Insurer of any Scheduled Payment.
SECTION 5.17 PREFERENCE CLAIMS; DIRECTION OF PROCEEDINGS. (a) In the
event that the Trustee has received a certified copy of an order of the
appropriate court that any Scheduled Payment paid on a Note has been avoided in
whole or in part as a preference payment under applicable bankruptcy law, the
Trustee shall so notify the Note Insurer, shall comply with the provisions of
the Note Policy to obtain payment by the Note Insurer of such avoided payment,
and shall, at the time it provides notice to the Note Insurer, notify Holders of
the Notes by mail that, in the event that any Noteholder's payment is so
recoverable, such Noteholder will be entitled to payment pursuant to the terms
of the Note Policy. Pursuant to the terms of the Note Policy, the Note Insurer
will make such payment on behalf of the Noteholder to the receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the Final Order (as
defined in the Note Policy) and not to the Trustee or any Noteholder directly
(unless a Noteholder has previously paid such payment to the receiver,
conservator, debtor-in-possession or trustee in bankruptcy named in the Final
Order, in which case the Note Insurer will make such payment to the Trustee for
payment, in accordance with the instructions to be provided by the Note Insurer,
to such Noteholder upon proof of such payment reasonably satisfactory to the
Note Insurer).
(b) Each notice of claim (in substantially the form attached to the
Note Policy as Exhibit A) shall provide that the Trustee, on its behalf and on
behalf of the Noteholders, thereby appoints the Note Insurer as agent and
attorney in fact for the Trustee and each Noteholder in any legal proceeding
with respect to the Notes. The Trustee shall promptly notify the Note Insurer of
any proceeding or the institution of any action (of which a Responsible Officer
of the Trustee has actual knowledge) seeking the avoidance as a preferential
transfer under applicable bankruptcy, insolvency, receivership, rehabilitation
or similar law (a "Preference Claim") of any payment made with respect to the
Notes. Each Holder of the Notes, by its purchase of Notes, and the Trustee
hereby agree that so long as a Note Insurer Default shall not have occurred and
be continuing, the Note Insurer may at any time during the continuation of any
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proceeding relating to a Preference Claim direct all matters relating to such
Preference Claim including (i) the direction of any appeal of any order relating
to any Preference Claim and (ii) the posting of any surety, supersedeas or
performance bond pending any such appeal at the expense of the Note Insurer, but
subject to the reimbursement as provided in the Insurance Agreement. In
addition, and without limitation of the foregoing, the Note Insurer shall be
subrogated to, and each Noteholder and the Trustee hereby delegate and assign,
to the fullest extent permitted by law, the rights of the Trustee and each
Noteholder in the conduct of any proceeding with respect to a Preference Claim,
including all rights of any party to an adversary proceeding action with respect
to any court order issued in connection with any such Preference Claim.
ARTICLE VI
THE TRUSTEE
-----------
SECTION 6.1 DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise the rights and powers vested in it by this Indenture and the
Basic Documents 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 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 Trustee; and
(ii) in the absence of bad faith on its part, the
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
Trustee and conforming to the requirements of this Indenture;
however, the Trustee shall examine the certificates and
opinions to determine whether or not they conform on their
face to the requirements of this Indenture.
(c) The 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;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it
is proved that the Trustee was negligent in ascertaining the
pertinent facts; and
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(iii) the 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
5.12.
(d) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Issuer.
(e) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law or the terms of the Basic
Documents.
(f) No provision of this Indenture shall require the Trustee in any of
its capacities 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 Trustee shall be
subject to the provisions of this Section.
(h) The Trustee shall permit any representative of the Note Insurer,
during the Trustee's normal business hours, to examine all books of account,
records, reports and other papers of the Trustee relating to the Notes, to make
copies and extracts therefrom and to discuss the Trustee's affairs and actions,
as such affairs and actions relate to the Trustee's duties with respect to the
Notes, with the Trustee's officers and employees responsible for carrying out
the Trustee's duties with respect to the Notes.
(i) The Trustee shall, and hereby agrees that it will, perform all of
the obligations and duties required of it under the Basic Documents.
(j) The Trustee shall, and hereby agrees that it will, hold the Note
Policy in trust, and will hold any proceeds of any claim on the Note Policy in
trust solely for the use and benefit of the Noteholders.
(k) In no event shall Xxxxx Fargo Bank, National Association, in any of
its capacities hereunder, be deemed to have assumed any duties of the Owner
Trustee under the Delaware Statutory Trust Statute, common law, or the Trust
Agreement.
(l) Except for actions expressly authorized by this Indenture, the
Trustee shall take no action reasonably likely to impair the security interests
created or existing under any Receivable or Financed Vehicle or to impair the
value of any Receivable or Financed Vehicle.
(m) All information obtained by the Trustee regarding the Obligors and
the Receivables, whether upon the exercise of its rights under this Indenture or
otherwise, shall be maintained by the Trustee in confidence and shall not be
disclosed to any other Person, other than the Trustee's attorneys, accountants
and agents unless such disclosure is required by this Indenture or any
applicable law or regulation.
SECTION 6.2 RIGHTS OF TRUSTEE.
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(a) Subject to Sections 6.1 and 6.2, the Trustee shall be protected and
shall incur no liability to the Issuer or any Issuer Secured Party in relying
upon the accuracy, acting in reliance upon the contents, and assuming the
genuineness of any notice, demand, certificate, signature, instrument or other
document reasonably believed by the Trustee to be genuine and to have been duly
executed by the appropriate signatory, and, except to the extent the Trustee has
actual knowledge to the contrary or as required pursuant to Section 6.1 or
Section 6.2(g) the Trustee shall not be required to make any independent
investigation with respect thereto.
(b) Before the Trustee acts or refrains from acting, it may require an
Officer's Certificate. Subject to Section 6.1(c), the Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on the
Officer's Certificate.
(c) The 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 Trustee shall not be responsible
for any misconduct or negligence on the part of, or for the supervision of
Consumer Portfolio Services, Inc., or any other such agent, attorney, custodian
or nominee appointed with due care by it hereunder.
(d) The 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 the Trustee's conduct does not constitute
willful misconduct, negligence or bad faith.
(e) The Trustee may consult with counsel, and the advice of such
counsel or any opinion of counsel with respect to legal matters relating to the
Basic Documents 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 Trustee shall be under no obligation to institute, conduct or
defend any litigation under this Indenture or in relation to this Indenture or
any of the Basic Documents, at the request, order or direction of any of the
Holders of Notes or the Controlling Party, pursuant to the provisions of this
Indenture, unless such Holders of Notes or the Controlling Party shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities that may be incurred therein or thereby; provided,
however, that the Trustee shall, upon the occurrence of an Event of Default
(that has not been cured or waived), exercise the rights and powers vested in it
by this Indenture in accordance with Section 6.1.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other paper
or document, unless requested in writing to do so by the Note Insurer (so long
as no Insurer Default shall have occurred and be continuing) or (if an Insurer
Default shall have occurred and be continuing) by the Holders of Notes
evidencing not less than 25% of the Outstanding Amount of each class thereof;
provided, however, that if the payment within a reasonable time to the Trustee
of the costs, expenses or liabilities likely to be incurred by it in the making
of such investigation is, in the opinion of the Trustee, not reasonably assured
to the Trustee by the security afforded to it by the terms of this Indenture or
the Sale and Servicing Agreement, the Trustee may require reasonable indemnity
against such cost, expense or liability as a condition to so proceeding; the
reasonable expense of every such examination shall be paid by the Person making
such request, or, if paid by the Trustee, shall be reimbursed by the Person
making such request upon demand.
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SECTION 6.3 INDIVIDUAL RIGHTS OF TRUSTEE. The 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 the Trustee. Any Note Paying Agent, Note Registrar, co-registrar or
co-paying agent may do the same with like rights. However, the Trustee must
comply with Section 6.11.
SECTION 6.4 TRUSTEE'S DISCLAIMER. The Trustee shall not be responsible
for and makes no representation as to the validity or adequacy of this
Indenture, any Basic Documents, the Trust Estate, the Collateral or the Notes,
it shall not be accountable for the Issuer's use of the proceeds from the Notes,
and it shall not be 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 other than the Trustee's certificate of authentication.
SECTION 6.5 NOTICE OF DEFAULTS. If an Event of Default occurs and is
continuing and if it is either known by, or written notice of the existence
thereof has been delivered to, a Responsible Officer of the Trustee, the Trustee
shall mail to each Noteholder notice of the Default within 30 days after such
knowledge or notice 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, if any), the Trustee may withhold
the notice if and so long as a committee of its Responsible Officers in good
faith determines that withholding the notice is in the interests of Noteholders.
SECTION 6.6 REPORTS BY TRUSTEE TO HOLDERS. The Trustee shall on behalf
of the Issuer deliver to each Noteholder such information as may be reasonably
required to enable such Holder to prepare its Federal and State income tax
returns.
SECTION 6.7 COMPENSATION AND INDEMNITY.
(a) Pursuant to Section 5.7(a) of the Sale and Servicing Agreement, the
Issuer shall pay to the Trustee from time to time compensation for its services,
as separately agreed. The Trustee's compensation shall not be limited by any law
on compensation of a trustee of an express trust. The Issuer shall reimburse the
Trustee, pursuant to Section 5.7(a) of the Sale and Servicing Agreement, for all
reasonable out-of-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 Trustee's agents, counsel, accountants and experts. The Issuer
shall or shall cause the Servicer to indemnify the Trustee against any and all
loss, liability or expense incurred by the Trustee without willful misfeasance,
negligence or bad faith on the Trustee's part arising out of or in connection
with the acceptance or 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 therewith and including any loss,
liability or expense directly or indirectly incurred (regardless of negligence
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on the part of the Trustee or the Issuer) by the Trustee as a result of any
penalty or other cost imposed by the Internal Revenue Service or other taxing
authority (except any penalties arising out of fees paid to the Trustee or as a
result of any action taken contrary to the Indenture) related to the tax status
of the Issuer or the Notes. The Trustee shall notify the Issuer and the Servicer
promptly of any claim for which it may seek indemnity. Failure by the Trustee to
so notify the Issuer and the Servicer shall not relieve the Issuer of its
obligations hereunder or the Servicer of its obligations under Article XII of
the Sale and Servicing Agreement. The Trustee may have separate counsel and the
Issuer shall or shall cause the Servicer to pay the fees and expenses of such
counsel. Neither the Issuer nor the Servicer need reimburse any expense or
indemnify against any loss, liability or expense incurred by the Trustee through
the Trustee's own willful misconduct, negligence or bad faith.
(b) The Issuer's payment obligations to the Trustee pursuant to this
Section shall survive the discharge of this Indenture. When the Trustee incurs
expenses after the occurrence of a Default specified in Section 5.1(a)(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. Notwithstanding anything
else set forth in this Indenture or the Basic Documents, the recourse of the
Trustee hereunder and under the Basic Documents shall be to the Trust Estate
only and specifically shall not be recourse to the assets of the Seller, the
Depositor, any Noteholder or any Residual Certificateholder. In addition, the
Trustee agrees that its recourse to the Trust Estate and amounts held in the
Series 2008-A Spread Account shall be limited to the right to receive the
distributions referred to in Section 5.7(a) of the Sale and Servicing Agreement.
SECTION 6.8 REPLACEMENT OF TRUSTEE. The Issuer may, with the consent of
the Note Insurer, and at the request of the Note Insurer (unless an Insurer
Default shall have occurred and be continuing), shall, remove the Trustee if:
(i) the Trustee fails to comply with Section 6.11;
(ii) an Insolvency Event with respect to the Trustee
occurs; or
(iii) the Trustee otherwise becomes incapable of
acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of the Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Issuer shall promptly appoint a
successor Trustee acceptable to the Note Insurer (so long as an Insurer Default
shall not have occurred and be continuing). If the Issuer fails to appoint such
a successor Trustee, the Note Insurer may appoint a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee, the Note Insurer (provided that no Insurer
Default shall have occurred and be continuing) and the Issuer, whereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the retiring
Trustee under this Indenture, subject to satisfaction of the Rating Agency
Condition. The successor Trustee shall mail a notice of its succession to each
Noteholder. The retiring Trustee shall promptly transfer all property held by it
as Trustee to the successor Trustee.
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If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer, the
Note Insurer or a Note Majority may petition any court of competent jurisdiction
for the appointment of a successor Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor Trustee
pursuant to Section 6.8.
Notwithstanding the replacement of the Trustee pursuant to this
Section, the Issuer's and the Servicer's obligations under Section 6.7 shall
continue for the benefit of the retiring Trustee.
SECTION 6.9 SUCCESSOR TRUSTEE BY MERGER.
(a) If the 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 without any further act shall be the successor Trustee.
The Trustee shall provide the Rating Agencies and the Note Insurer with written
notice of any such transaction.
(b) In case at the time such successor or successors to the Trustee by
merger, conversion or consolidation 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 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 Trustee may authenticate such Notes either in the name of any predecessor
hereunder or in the name of the successor to the Trustee; and 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 Trustee shall have.
SECTION 6.10 APPOINTMENT OF CO-TRUSTEE OR SEPARATE 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 Trust Estate may at the time be located, the Trustee with
the consent of the Note Insurer (so long as an Insurer Default shall not have
occurred and be continuing) shall have the power and may execute and deliver all
instruments 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 Estate, and to vest in such Person or Persons, in such capacity and for
the benefit of the Noteholders, such title to the Trust Estate, or any part
hereof, and, subject to the other provisions of this Section, such powers,
duties, obligations, rights and trusts as the 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 hereof.
(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:
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(i) all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or
imposed upon and exercised or performed by the Trustee and
such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not
authorized to act separately without the 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 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
Trust 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 Trustee;
(ii) no trustee hereunder shall be personally liable
by reason of any act or omission of any other trustee
hereunder, including acts or omissions of predecessor or
successor trustees; and
(iii) the 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 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 Agreement 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 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 Trustee. Every
such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
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, dissolve, become insolvent, 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 Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 6.11 ELIGIBILITY: DISQUALIFICATION. The Trustee, and any
successor thereto, shall at all times 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 subject to supervision or examination by federal or State
authorities and satisfactory to the Note Insurer; and having a rating, both with
respect to long-term and short-term unsecured obligations, of not less than
investment grade by the Rating Agencies. The Trustee shall provide copies of
such reports to the Note Insurer upon request.
SECTION 6.12 RESERVED.
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SECTION 6.13 APPOINTMENT AND POWERS. Subject to the terms and
conditions hereof, each of the Issuer Secured Parties hereby appoints Xxxxx
Fargo Bank, National Association as the Trustee with respect to the Collateral,
and Xxxxx Fargo Bank, National Association hereby accepts such appointment and
agrees to act as Trustee with respect to the Collateral for the Issuer Secured
Parties, to maintain custody and possession of such Collateral (except as
otherwise provided hereunder) and to perform the other duties of the Trustee in
accordance with the provisions of this Indenture and the other Basic Documents.
Each Issuer Secured Party hereby authorizes the Trustee to take such action on
its behalf, and to exercise such rights, remedies, powers and privileges
hereunder, as the Controlling Party may direct and as are specifically
authorized to be exercised by the Trustee by the terms hereof, together with
such actions, rights, remedies, powers and privileges as are reasonably
incidental thereto. The Trustee shall act upon and in compliance with the
written instructions of the Controlling Party delivered pursuant to this
Indenture promptly following receipt of such written instructions; provided that
the Trustee shall not act in accordance with any instructions (i) which are not
authorized by, or in violation of the provisions of, this Indenture, (ii) which
are in violation of any applicable law, rule or regulation or (iii) for which
the Trustee has not received reasonable indemnity. Receipt of such instructions
shall not be a condition to the exercise by the Trustee of its express duties
hereunder, except where this Indenture provides that the Trustee is permitted to
act only following and in accordance with such instructions.
SECTION 6.14 PERFORMANCE OF DUTIES. The Trustee shall have no duties or
responsibilities except those expressly set forth in this Indenture and the
other Basic Documents to which the Trustee is a party or as directed by the
Controlling Party in accordance with this Indenture. The Trustee shall not be
required to take any discretionary actions hereunder except at the written
direction and with the indemnification of the Controlling Party and as provided
in Section 5.12. The Trustee shall, and hereby agrees that it will, perform all
of the duties and obligations required of it under the Sale and Servicing
Agreement.
SECTION 6.15 LIMITATION ON LIABILITY. Neither the Trustee nor any of
its directors, officers or employees shall be liable for any action taken or
omitted to be taken by it or them in good faith hereunder, or in connection
herewith, except that the Trustee shall be liable for its negligence, bad faith
or willful misconduct. Notwithstanding any term or provision of this Indenture,
the Trustee shall incur no liability to the Issuer or the Issuer Secured Parties
for any action taken or omitted by the Trustee in connection with the
Collateral, except for the negligence, bad faith or willful misconduct on the
part of the Trustee, and, further, shall incur no liability to the Issuer
Secured Parties except for negligence, bad faith or willful misconduct in
carrying out its duties to the Issuer Secured Parties. The Trustee shall at all
times be free independently to establish to its reasonable satisfaction, but
shall have no duty to independently verify, the existence or nonexistence of
facts that are a condition to the exercise or enforcement of any right or remedy
hereunder or under any of the Basic Documents. The Trustee may consult with
counsel, and shall not be liable for any action taken or omitted to be taken by
it hereunder in good faith and in accordance with the written advice of such
counsel. The Trustee shall not be under any obligation to exercise any of the
remedial rights or powers vested in it by this Indenture or to follow any
direction from the Controlling Party unless it shall have received reasonable
security or indemnity satisfactory to the Trustee against the costs, expenses
and liabilities which might be incurred by it.
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SECTION 6.16 RESERVED.
SECTION 6.17 SUCCESSOR TRUSTEE.
(a) MERGER. Any Person into which the Trustee may be converted or
merged, or with which it may be consolidated, or to which it may sell or
transfer its trust business and assets as a whole or substantially as a whole,
or any Person resulting from any such conversion, merger, consolidation, sale or
transfer to which the Trustee is a party, shall (provided it is otherwise
qualified to serve as the Trustee hereunder) be and become a successor Trustee
hereunder and be vested with all of the title to and interest in the Collateral
and all of the trusts, powers, discretions, immunities, privileges and other
matters as was its predecessor without the execution or filing of any instrument
or any further act, deed or conveyance on the part of any of the parties hereto,
anything herein to the contrary notwithstanding, except to the extent, if any,
that any such action is necessary to perfect, or continue the perfection of, the
security interest of the Issuer Secured Parties in the Collateral; provided that
any such successor shall also be the successor Trustee under Section 6.9.
(b) REMOVAL. The Trustee may be removed by the Note Insurer (or, if an
Insurer Default has occurred and is continuing, by a Note Majority) at any time,
with or without cause, by an instrument or concurrent instruments in writing
delivered to the Trustee, the other Issuer Secured Party and the Issuer. A
temporary successor may be removed at any time to allow a successor Trustee to
be appointed pursuant to subsection (c) below. Any removal pursuant to the
provisions of this subsection (b) shall take effect only upon the date which is
the latest of (i) the effective date of the appointment of a successor Trustee
and the acceptance in writing by such successor Trustee of such appointment and
of its obligation to perform its duties hereunder in accordance with the
provisions hereof, and (ii) receipt by the Controlling Party of an Opinion of
Counsel to the effect described in Section 3.6.
(c) ACCEPTANCE BY SUCCESSOR. The Controlling Party shall have the sole
right to appoint each successor Trustee. Every temporary or permanent successor
Trustee appointed hereunder shall execute, acknowledge and deliver to its
predecessor and to the Trustee, each Issuer Secured Party and the Issuer an
instrument in writing accepting such appointment hereunder and the relevant
predecessor shall execute, acknowledge and deliver such other documents and
instruments as will effectuate the delivery of all Collateral to the successor
Trustee, whereupon such successor, without any further act, deed or conveyance,
shall become fully vested with all the estates, properties, rights, powers,
duties and obligations of its predecessor. Such predecessor shall, nevertheless,
on the written request of an Issuer Secured Party or the Issuer, execute and
deliver an instrument transferring to such successor all the estates,
properties, rights and powers of such predecessor hereunder. In the event that
any instrument in writing from the Issuer or an Issuer Secured Party is
reasonably required by a successor Trustee to more fully and certainly vest in
such successor the estates, properties, rights, powers, duties and obligations
vested or intended to be vested hereunder in the Trustee, any and all such
written instruments shall at the request of the temporary or permanent successor
Trustee, be forthwith executed, acknowledged and delivered by the Trustee or the
Issuer, as the case may be. The designation of any successor Trustee and the
instrument or instruments removing any Trustee and appointing a successor
hereunder, together with all other instruments provided for herein, shall be
maintained with the records relating to the Collateral and, to the extent
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required by applicable law, filed or recorded by the successor Trustee in each
place where such filing or recording is necessary to effect the transfer of the
Collateral to the successor Trustee or to protect or continue the perfection of
the security interests granted hereunder.
SECTION 6.18 RESERVED.
SECTION 6.19 REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The Trustee
represents and warrants to the Issuer and to each Issuer Secured Party as
follows:
(a) DUE ORGANIZATION. The Trustee is a national banking association,
duly organized, validly existing and in good standing under the laws of the
United States and is duly authorized and licensed under applicable law to
conduct its business as presently conducted.
(b) CORPORATE POWER. The Trustee has all requisite right, power and
authority to execute and deliver this Indenture and to perform all of its duties
as Trustee hereunder.
(c) DUE AUTHORIZATION. The execution and delivery by the Trustee of
this Indenture and the other Basic Documents to which it is a party, and the
performance by the Trustee of its duties hereunder and thereunder, have been
duly authorized by all necessary corporate proceedings and no further approvals
or filings, including any governmental approvals, are required for the valid
execution and delivery by the Trustee, or the performance by the Trustee, of
this Indenture and such other Basic Documents.
(d) VALID AND BINDING INDENTURE. The Trustee has duly executed and
delivered this Indenture and each other Basic Document to which it is a party,
and each of this Indenture and each such other Basic Document constitutes the
legal, valid and binding obligation of the Trustee, enforceable against the
Trustee in accordance with its terms, except as (i) such enforceability may be
limited by bankruptcy, insolvency, reorganization and similar laws relating to
or affecting the enforcement of creditors' rights generally and (ii) the
availability of equitable remedies may be limited by equitable principles of
general applicability.
SECTION 6.20 WAIVER OF SETOFFS. The Trustee hereby expressly waives any
and all rights of setoff that the Trustee may otherwise at any time have under
applicable law with respect to any Trust Account and agrees that amounts in the
Trust Accounts shall at all times be held and applied solely in accordance with
the provisions hereof.
SECTION 6.21 CONTROL BY THE CONTROLLING PARTY. The Trustee shall comply
with notices and instructions given by the Issuer only if accompanied by the
written consent of the Controlling Party, except that if any Event of Default
shall have occurred and be continuing, the Trustee shall act upon and comply
with notices and instructions given by the Controlling Party alone in the place
and stead of the Issuer.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
------------------------------
SECTION 7.1 ISSUER TO FURNISH TO TRUSTEE NAMES AND ADDRESSES OF
NOTEHOLDERS. The Issuer will furnish or cause to be furnished to the Trustee (a)
not more than five days after the earlier of (i) each Record Date and (ii) three
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months after the last Record Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of such Record
Date, (b) at such other times as the Trustee may request in writing, within 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 10 days prior to the time such list is
furnished; provided, however, that so long as the Trustee is the Note Registrar,
no such list shall be required to be furnished. If the Notes are Definitive
Notes, the Trustee or, if the Trustee is not the Note Registrar, the Issuer
shall furnish to the Note Insurer in writing on an annual basis on each March 31
and at such other times as the Note Insurer may request a copy of the list.
SECTION 7.2 PRESERVATION OF INFORMATION; COMMUNICATIONS TO NOTEHOLDERS.
The Trustee shall preserve, in as current a form as is reasonably practicable,
the names and addresses of the Holders contained in the most recent list
furnished to the Trustee as provided in Section 7.1 and the names and addresses
of Holders received by the Trustee in its capacity as Note Registrar. The
Trustee may destroy any list furnished to it as provided in such Section 7.1
upon receipt of a new list so furnished.
ARTICLE VIII
COLLECTION OF MONEY AND RELEASES OF TRUST ESTATE
------------------------------------------------
SECTION 8.1 COLLECTION OF MONEY. Except as otherwise expressly provided
herein, the 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
Trustee pursuant to this Indenture and the Sale and Servicing Agreement. The
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 or in the Sale and Servicing Agreement, if any default occurs in
the making of any payment or performance under any agreement or instrument that
is part of the Trust Estate, the 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 RELEASE OF TRUST ESTATE.
(a) Subject to the payment of its fees and expenses pursuant to Section
6.7, the Trustee may, and when required by the provisions of this Indenture
shall, execute instruments to release property from the lien of this Indenture,
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 Trustee as provided in this Article VIII shall be bound to ascertain the
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any moneys.
(b) The Trustee shall, at such time as there are no Notes outstanding,
all Issuer Secured Obligations have been paid in full and all sums due the
Trustee pursuant to Section 6.7 have been paid, release any remaining portion of
the 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 Trustee shall release property from the lien
of this Indenture pursuant to this Section 8.2(b) only upon receipt of an Issuer
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Request accompanied by an Officer's Certificate and an Opinion of Counsel
meeting the applicable requirements of Section 11.1.
SECTION 8.3 OPINION OF COUNSEL. The Trustee shall receive at least
seven days' notice when requested by the Issuer to take any action pursuant to
Section 8.2(a), accompanied by copies of any instruments involved, and the
Trustee shall also require as a condition to such action, an Opinion of Counsel
in form and substance satisfactory to the 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 affect the
security for the Notes or the rights of the Issuer Secured Parties in
contravention of the provisions of this Indenture; provided, however, that such
Opinion of Counsel shall not be required to express an opinion as to the fair
value of the 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 Trustee in connection with any such action.
ARTICLE IX
SUPPLEMENTAL INDENTURES
-----------------------
SECTION 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS.
(a) Without the consent of the Holders of any Notes or Residual
Certificateholders but with the consent of the Note Insurer (unless an Insurer
Default shall have occurred and be continuing) and with prior notice to the
Rating Agencies by the Issuer, the Issuer and the 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 Trustee, for any of the following purposes; provided,
however, if any party to this Indenture is unable to sign any supplemental
indenture due to its dissolution, winding up or comparable circumstances, then
the consent of the Note Insurer or a Note Majority shall be sufficient to amend
this Indenture without such party's signature:
(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 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 Holders of the Notes, 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 Trustee;
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(v) to cure any ambiguity, to correct or supplement
any provision herein or in any supplemental indenture which
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 in any supplemental indenture; provided that such action
shall not adversely affect the interests of the Holders of the
Notes or the rating of the Notes; or
(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.
The 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 not inconsistent with the foregoing.
(b) The Issuer and the Trustee, when authorized by an Issuer Order,
may, also without the consent of any of the Holders of the Notes or Residual
Certificateholders but with prior notice to the Rating Agencies by the Issuer
and with the prior written consent of the Note Insurer (unless an Insurer
Default shall have occurred and be continuing), 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 the rights of the Holders of the Notes under this
Indenture; provided, however, that such action shall not, as evidenced by an
Opinion of Counsel, adversely affect the interests of any Noteholder in any
material respect. Any such action shall be deemed to not adversely affect in any
material respect the interests of any Noteholder if the Rating Agency Condition
has been satisfied.
SECTION 9.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS. The
Issuer and the Trustee, when authorized by an Issuer Order, also may, without
the consent of the Residual Certificateholders, but with prior notice to the
Rating Agencies and with the consent of the Note Insurer (unless an Insurer
Default shall have occurred and be continuing) or, if an Insurer Default shall
have occurred and be continuing, with the consent of a Note Majority, by Act of
such Holders delivered to the Issuer and the 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 of modifying in any manner the rights of the Holders of the Notes under this
Indenture; provided, however, if any party to this Indenture is unable to sign
any supplemental indenture due to its dissolution, winding up or comparable
circumstances, then the consent of the Note Insurer (unless an Insurer Default
shall have occurred and be continuing) or, if an Insurer Default shall have
occurred and be continuing, the consent of a Note Majority shall be sufficient
to amend this Indenture without such party's signature; provided, further
however, that, subject to the express rights of the Note Insurer under the Basic
Documents and notwithstanding SECTION 11.20, no such supplemental indenture
shall, without the consent of the Holder of each Outstanding Note affected
thereby:
(i) change 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 provision of this
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Indenture relating to the application of collections on, or
the proceeds of the sale of, the 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;
(ii) impair the right to institute suit for the
enforcement of 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 Outstanding Amount
of the Notes, the consent of the Holders of which is required
for any such supplemental indenture, or the consent of the
Holders of which is required for any waiver of compliance with
certain provisions of this Indenture or certain defaults
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 Outstanding Amount
of the Notes required to direct the Trustee to direct the
Issuer to sell or liquidate the Trust Estate pursuant to
Section 5.4;
(vi) modify any provision of this Section except to
increase any percentage specified herein or to provide that
certain additional provisions of this Indenture or the Basic
Documents cannot be modified or waived without the consent of
the Holder 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
Payment Date (including the calculation of any of the
individual components of such calculation) or as to affect the
rights of the Holders of Notes 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 Trust Estate or, except as otherwise
permitted or contemplated herein or in any of the Basic
Documents, terminate the lien of this Indenture on any
property at any time subject hereto or deprive the Holder of
any Note of the security provided by the lien of this
Indenture.
It shall not be necessary for any Act of Noteholders under this Section
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.
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Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to this Section, the Trustee shall mail to the
Holders 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 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 modifications thereby of the trusts created
by this Indenture, the 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. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture that affects the 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 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
Trustee, the Issuer and the Holders of the Notes 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 RESERVED.
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 Issuer shall, bear a
notation in form approved by the Issuer as to any matter provided for in such
supplemental indenture. If the Issuer shall so determine, new Notes so modified
as to conform, in the opinion of the Issuer, to any such supplemental indenture
may be prepared and executed by the Issuer and authenticated and delivered by
the Trustee in exchange for Outstanding Notes.
ARTICLE X
REDEMPTION OF NOTES
-------------------
SECTION 10.1 REDEMPTION.
The Notes are subject to redemption in whole, but not in part,
at the direction of the Servicer pursuant to Section 11.1(a) of the
Sale and Servicing Agreement, on any Payment Date on which the Servicer
exercises its option to purchase the Trust Estate pursuant to said
Section 11.1(a), for a purchase price at least equal to the Redemption
Price; provided, however, that the Issuer has available funds
sufficient to pay the Redemption Price and all amounts due to the Note
Insurer under the Basic Documents. The Servicer or the Issuer shall
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furnish the Note Insurer and the Rating Agencies notice of such
redemption. If the Notes are to be redeemed pursuant to this Section
10.1, the Servicer or the Issuer shall furnish notice of such election
to the Trustee not later than 35 days prior to the Redemption Date and
the Servicer shall deposit with the Trustee in the Note Distribution
Account the Redemption Price of the Notes to be redeemed at least one
Business Day prior to the Redemption Date. If the Servicer fails to so
deposit the Redemption Price with the Trustee at least one Business Day
prior to the Redemption Date, such redemption shall be deemed to be
automatically rescinded and the Noteholders shall receive the payments
of interest and principal that would be due to the Noteholders on such
Payment Date as if such option to redeem the Notes had never been
exercised. For the avoidance of any doubt, no Event of Default shall
occur solely as a result of such rescission.
SECTION 10.2 FORM OF REDEMPTION NOTICE.
Notice of redemption under Section 10.1 shall be given by the Trustee
by facsimile or by first-class mail, postage prepaid, transmitted or mailed
prior to the applicable Redemption Date to each Holder of Notes, as of the close
of business on the Record Date preceding the applicable Redemption Date, at such
Holder's address appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) that the Record Date otherwise applicable to
such Redemption Date is not applicable and that payments shall
be made only upon presentation and surrender of such Notes and
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 interest on the Notes shall cease to accrue
on the Redemption Date.
Notice of redemption of the Notes shall be given by the Trustee in the
name and at the expense of the Issuer. Failure to give notice of redemption, or
any defect therein, to any Holder of any Note 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), 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 Trustee to
take any action under any provision of this Indenture, the Issuer shall furnish
to the Trustee and to the Note Insurer (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, and (ii) an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with 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:
(i) 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;
(ii) 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;
(iii) 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
(iv) a statement as to whether, in the opinion of
each such signatory such condition or covenant has been
complied with.
(b) (i) Prior to the deposit of any Collateral or other property or
securities with the 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 Trustee and the Note Insurer an Officer's Certificate
certifying or stating the opinion of each person signing such certificate as to
the fair value (on the date 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 Trustee and the Note Insurer 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 Trustee and the Note Insurer an
Independent Certificate as to the same matters, if the fair
value to the Issuer of the securities to be so deposited and
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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 10% or more of the Outstanding Amount of the
Notes, 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 1% of the
Outstanding Amount of the Notes.
(iii) Other than with respect to the release of any
Purchased Receivables, Defaulted Texas Receivables or
Liquidated Receivables, whenever any property or securities
are to be released from the lien of this Indenture, the Issuer
shall also furnish to the Trustee and the Note Insurer an
Officer's Certificate certifying or stating the opinion of
each person signing such certificate as to the fair value
(within 90 days of such release) of the property or securities
proposed to be released and stating that in the opinion 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 Trustee and the Note Insurer 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 Trustee and the Note Insurer an
Independent Certificate as to the same matters if the fair
value of the property or securities and of all other property
other than Purchased Receivables, Defaulted Texas Receivables
and Liquidated Receivables, 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
10% or more of the Outstanding Amount of the Notes, 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 1% of the then Outstanding Amount of the
Notes.
(v) Notwithstanding Section 2.9 or any provision of
this Section, the Issuer may (A) collect, liquidate, sell or
otherwise dispose of Receivables as and to the extent
permitted or required by the Basic Documents and (B) make cash
payments out of the Trust Accounts as and to the extent
permitted or required by the Basic Documents.
SECTION 11.2 FORM OF DOCUMENTS DELIVERED TO 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 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
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representations with respect to the matters upon which his or her 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 or the Issuer, stating that the information with
respect to such factual matters is in the possession of the Servicer, the Seller
or the Issuer, unless such counsel knows, 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, consents, 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 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 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.
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 Trustee, and, where it is hereby expressly required, to the
Issuer. Such instrument or instruments (and the action embodied therein 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 Trustee and the Issuer, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any customary manner of the Trustee.
(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 Holder of any Notes shall bind the Holder 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
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.
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SECTION 11.4 NOTICES, ETC., TO TRUSTEE, ISSUER, NOTE INSURER AND RATING
AGENCIES.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or Act of Noteholders or other documents provided or permitted by this
Indenture to be made upon, given or furnished to or filed with:
(i) the Trustee by any Noteholder or by the Issuer
shall be sufficient for every purpose hereunder if personally
delivered, delivered by overnight courier or mailed certified
mail, return receipt requested and shall be deemed to have
been duly given upon receipt to the Trustee at its Corporate
Trust Office;
(ii) the Issuer by the Trustee or by any Noteholder
shall be sufficient for every purpose hereunder if personally
delivered, delivered by overnight courier or mailed certified
mail, return receipt requested and shall be deemed to have
been duly given upon receipt to the Issuer addressed to: CPS
Auto Receivables Trust 2008-A, in care of Wilmington Trust
Company, Xxxxxx Square North, 0000 X. Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000-0000, or at such other address
previously furnished in writing to the Trustee by the Issuer.
The Issuer shall promptly transmit any notice received by it
from the Noteholders to the Trustee; or
(iii) the Note Insurer by the Issuer or the Trustee
shall be sufficient for any purpose hereunder if in writing
and mailed by registered mail or personally delivered or
telexed or telecopied to the recipient as follows:
To the Note Insurer:
Financial Security Assurance Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Transaction Oversight Department
Re: Policy No. 51897-N
Telex No.: (000) 000-0000
Confirmation: (000) 000-0000
Telecopy Nos.: (000) 000-0000 or (000) 000-0000
(In each case in which notice or other communication to the Note
Insurer refers to an Event of Default, a claim on the Note Policy or with
respect to which failure on the part of the Note Insurer to respond shall be
deemed to constitute consent or acceptance, then a copy of such notice or other
communication should also be sent to the attention of the General Counsel
"URGENT MATERIAL ENCLOSED" at the foregoing address.)
(b) Notices required to be given to the Rating Agencies by the Issuer,
the Trustee or the Owner Trustee shall be in writing, personally delivered,
electronically delivered, delivered by overnight courier or mailed certified
mail, return receipt requested to (i) in the case of Moody's, at the following
address: Xxxxx'x Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx New York
-62-
10004 and (ii) in the case of S&P, via electronic delivery to
Xxxxxxxx_xxxxxxx@xxxxx.xxx; for any information not available in electronic
format, send hard copies to: Standard & Poor's Ratings Services, 00 Xxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention: ABS Surveillance
Group; or as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
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 expressly
provided herein) if in writing and mailed, first-class, postage 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 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 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 Holder of a Note providing for a method of
payment, or notice by the Trustee or any Note Paying Agent to such Holder, that
is different from the methods provided for in this Indenture for such payments
or notices, provided that such methods are reasonable and consented to by the
Trustee (which consent shall not be unreasonably withheld). The Issuer will
furnish to the Trustee a copy of each such agreement and the Trustee will cause
payments to be made and notices to be given in accordance with such agreements.
SECTION 11.7 RESERVED.
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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 Trustee in this
Indenture shall bind its successors. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 11.10 SEVERABILITY. 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. The Note Insurer and its
successors and assigns shall be third-party beneficiaries to the provisions of
this Indenture, and shall be entitled to rely upon and directly to enforce such
provisions of this Indenture so long as no Insurer Default shall have occurred
and be continuing. 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
Trust Estate, any benefit or any legal or equitable right, remedy or claim under
this Indenture. The Note Insurer may disclaim any of its rights and powers under
this Indenture (in which case the Trustee may exercise such right or power
hereunder), but not its duties and obligations under the Note Policy, upon
delivery of a written notice to the Trustee.
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, AND THIS INDENTURE AND ALL MATTERS ARISING OUT OF OR RELATING
IN ANY WAY TO THIS INDENTURE SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
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 Trustee or any other counsel reasonably acceptable
to the Trustee and the Note Insurer) to the effect that such recording is
necessary either for the protection of the Noteholders or any other person
-64-
secured hereunder or for the enforcement of any right or remedy granted to the
Trustee under this Indenture or to the Collateral Agent under the Master Spread
Account Agreement.
SECTION 11.16 TRUST OBLIGATION. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Seller, the
Servicer, the Depositor, the Owner Trustee or the Trustee on the Notes or under
this Indenture or any certificate or other writing delivered in connection
herewith or therewith, against (i) the Seller, the Servicer, the Depositor, the
Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
agent, officer, director, employee or agent of the Seller, the Servicer, the
Depositor, the Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Seller, the Servicer, the
Depositor, the Owner Trustee or the Trustee or of any successor or assign of the
Seller, the Servicer, the Depositor, the Trustee or the Owner Trustee in its
individual capacity, except as any such Person may have expressly agreed (it
being understood that the Trustee and the Owner Trustee have no such obligations
in their individual capacity) 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 Articles VI, VII and VIII of the Trust
Agreement.
SECTION 11.17 NO PETITION. The Trustee, by entering into this
Indenture, and each Noteholder and Note Owner, by accepting a Note or a
beneficial interest therein, hereby covenant and agree that they will not at any
time institute against the Seller, the Depositor, or the Issuer, or join in any
institution against the Seller, the Depositor, 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 Basic Documents.
SECTION 11.18 INSPECTION. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Trustee or of the Note Insurer,
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
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 Trustee may reasonably determine that such disclosure is
consistent with its Obligations hereunder.
SECTION 11.19 ACTION UPON DIRECTION OF NOTEHOLDERS. Except where this
Indenture specifically states otherwise, the Trustee, provided it has sent out
notices in accordance with this Indenture, may act as directed by a Note
Majority responding in writing to such request for amendment or written
direction, provided however, that a Note Majority as of the time such voting
response is due back to the Trustee must have responded in writing to the
Trustee's notice to amend or for written direction. In addition, the Trustee
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shall not have any liability to any Noteholder or Note Owner with respect to any
action taken pursuant to such notice if the Noteholder or Note Owner does not
respond to such notice within the time period set forth in such notice. By
acceptance of a Note, each Noteholder and Note Owner agree to the foregoing
provisions.
SECTION 11.20 NOTE INSURER AS CONTROLLING PARTY(a) .
(a) Each Noteholder by purchase of the Notes held by it acknowledges
that the Trustee, as partial consideration of the issuance of the Note Policy,
has agreed that the Note Insurer shall have certain rights hereunder for so long
as no Insurer Default shall have occurred and be continuing. So long as no
Insurer Default has occurred and is continuing, except as otherwise provided
herein, whenever Noteholder or Residual Certificateholder action, consent or
approval is required under this Indenture, such action, consent or approval
shall be deemed taken or given on behalf of, and shall be binding upon, all
Noteholders and Residual Certificateholders if the Note Insurer agrees to take
such action or give such consent or approval. So long as an Insurer Default has
occurred and is continuing, any provision giving the Note Insurer the right to
direct, appoint or consent to, approve of, or take any action as Controlling
Party under this Indenture shall be inoperative during the period of such
Insurer Default and such right shall instead vest in the Trustee acting, unless
otherwise specified, at the direction of a Note Majority. The Note Insurer may
disclaim any of its rights and powers under this Indenture (but not its duties
and obligations under the Note Policy) upon delivery of a written notice to the
Trustee. The Note Insurer may give or withhold any consent hereunder in its sole
and absolute discretion. In exercising its rights as Controlling Party, the Note
Insurer (or the Trustee acting at the direction of Noteholders) shall have no
duty to the Residual Certificateholders or any other Issuer Secured Party, and
the Trustee shall be fully protected in acting upon the direction of the Note
Insurer as Controlling Party (or in acting as Controlling Party at the direction
of Noteholders without regard to the interests of the Residual
Certificateholders.
(b) Each Residual Certificateholder, by its acceptance of a Residual
Certificate, agrees that it shall not (and hereby waives any right to) contest
or support any other Person in contesting, in any proceeding, the validity or
enforceability of the Notes or this Indenture.
(c) No right of the Note Insurer (or the Trustee acting at the
direction of Noteholders) as Controlling Party shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Issuer or
by any act or failure to act, in good faith, by the Controlling Party, or by any
non-compliance by the Issuer with the terms, provisions and covenants of this
Agreement, regardless of any knowledge thereof that the Note Insurer or the
Trustee may have or be otherwise charged with.
(d) So long as the Note Insurer (or the Trustee acting at the direction
of Noteholders) is the Controlling Party:
(i) no Residual Certificateholder shall have any
right to (A) ask, demand, xxx for, take or receive, or retain,
from the Issuer or any other Person, by setoff or in any other
manner, payment or prepayment of all or any part of the
obligations due to the Residual Certificateholders, except in
strict accordance with Section 5.7 of the Sale and Servicing
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Agreement or Section 5.6 of the Indenture, as applicable; (B)
ask, demand or receive any security (other than the
Collateral) for the Residual Certificate Secured Obligations;
(C) exercise or seek to exercise any rights or remedies
(including setoff) with respect to any Collateral or institute
any action or proceeding with respect to such rights or
remedies (including any action of foreclosure); (D) contest,
protest or object to any foreclosure proceeding or action
brought by the Trustee or any other exercise by the Trustee of
any rights and remedies relating to the Collateral; or (E)
object to the forbearance by the Trustee from bringing or
pursuing any foreclosure proceeding or action or any other
exercise of any rights or remedies relating to the Collateral;
(ii) the Controlling Party shall, except as otherwise
expressly provided herein, have the exclusive right to direct
the Trustee with respect to enforcing rights, exercising
remedies (including setoff and the right to credit bid their
debt) and making determinations regarding the release,
disposition, or restrictions with respect to the Collateral
without any consultation with or the consent of any Residual
Certificateholder.
(e) So long as the Note Insurer (or the Trustee acting at the direction
of Noteholders) is the Controlling Party, each Residual Certificateholder hereby
waives any and all rights it may have as a junior lien creditor or otherwise to
object to the manner in which the Trustee seeks to enforce or collect the
Insurer Secured Obligations or the Trustee Secured Obligations or the Liens
granted in any of the Collateral, regardless of whether any action or failure to
act by or on behalf of the Trustee or the Controlling Party is adverse to the
interest of any Residual Certificateholder.
(f) So long as the Note Insurer (or the Trustee acting at the direction
of Noteholders) is the Controlling Party, to the extent that the Residual
Certificateholders shall be entitled to vote as a separate class with respect to
any plan of reorganization involving the Issuer, each Residual Certificateholder
agrees that (i) it will not take any action or vote in any way which supports
any plan of reorganization that is inconsistent with the terms of this
Agreement, (ii) it will vote any claims or interest it holds to accept any such
plan of reorganization that is supported by the Controlling Party and (iii) it
will vote any claims or interests it holds to reject any such plan of
reorganization that is not supported by the Controlling Party. Each Residual
Certificateholder hereby grants to the Trustee (acting at the direction of the
Controlling Party) a power of attorney to vote such Residual Certificateholder's
claims and interests, if any, in any such plan of reorganization in a manner
consistent with the foregoing, so long as the Note Insurer (or the Trustee
acting at the direction of Noteholders) is the Controlling Party.
(g) So long as the Note Insurer (or the Trustee acting at the direction
of Noteholders) is the Controlling Party, each Residual Certificateholder agrees
that it shall not assert or finance, or support any other person in asserting or
financing, in any bankruptcy or insolvency proceeding, any surcharge, lien,
recovery or claim against any of the Collateral under Section 506(c) of the
United States Bankruptcy Code.
(h) So long as the Note Insurer (or the Trustee acting at the direction
of Noteholders) is the Controlling Party, each Residual Certificateholder agrees
that it shall not seek adequate protection on account of any claim or interest
it may have, or (to the extent it would otherwise have a right to object) object
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to any financing provided by or supported by the Controlling Party and that (to
the extent its consent is necessary or desired) it will consent to any sale of
Collateral that is supported by the Controlling Party.
(i) Each of the Trustee and the Controlling Party is each hereby
authorized to demand specific performance of the provisions of this Section
11.20 at any time when any Residual Certificateholder shall have failed to
comply with any term or provision of this Section 11.20. Each Residual
Certificateholder hereby irrevocably waives any defense based on the adequacy of
a remedy at law that might be asserted as a bar to such remedy of specific
performance.
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IN WITNESS WHEREOF, the Issuer and the Trustee have caused this
Indenture to be duly executed by their respective officers, hereunto duly
authorized, all as of the day and year first above written.
CPS AUTO RECEIVABLES TRUST 2008-A,
By: WILMINGTON TRUST COMPANY,
not in its individual capacity,
but solely as Owner Trustee
By: /S/ Xxxxx X. Xxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxx
----------------------------------
Title: Financial Services Officer
----------------------------------
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Trustee
By: /S/ Xxxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxxxxx
----------------------------------
Title: Vice President
----------------------------------
INDENTURE - SIGNATURE PAGE
EXHIBIT A-1
FORM OF CLASS A-1 NOTE
REGISTERED $___________________
NO. R-A1 - [__]
SEE REVERSE FOR CERTAIN DEFINITIONS
CUSIP NO. 126190A A5
[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.]
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES ("BLUE SKY LAWS"), AND THIS NOTE MAY NOT BE
OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE 1933 ACT IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, (C) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED
UNDER THE 1933 ACT (IF AVAILABLE) OR (D) TO THE SELLER OR AN AFFILIATE OF THE
SELLER, IN EACH CASE IN ACCORDANCE WITH THE INDENTURE AND ALL APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF THE EXEMPTION
PROVIDED BY RULE 144A FOR RESALES OF THIS 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.
CPS AUTO RECEIVABLES TRUST 2008-A
CLASS A-1 3.4695% ASSET-BACKED NOTES
CPS Auto Receivables Trust 2008-A, a statutory 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
A-1-1
__________________________________________ AND NO/100 DOLLARS payable on each
Payment Date in an amount equal to the aggregate amount, if any, payable from
the Note Distribution Account in respect of principal on the Class A-1 Notes
pursuant to Section 3.1 of the Indenture and Section 5.7 of the Sale and
Servicing Agreement; provided, however, that the entire unpaid principal amount
of this Note shall be due and payable on the Payment Date occurring in April
2009 (the "Class A-1 Final Scheduled Payment Date"). The Issuer will pay
interest on this Note at the rate per annum shown above on each Payment 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 Payment Date (after
giving effect to all payments of principal made on the preceding Payment Date).
Interest on this Note will accrue for each Payment Date from and including the
immediately preceding Payment Date to but excluding such current Payment Date;
provided that for the April 2008 Payment Date interest will accrue for the
number of days from and including the Closing Date to and including April 14,
2008. Interest will be computed on the basis of a 360-day year and the actual
number of days in the period commencing on the Payment Date in the month
preceding the month in which the related Payment Date occurs and ending on the
day prior to the day of the month on which the related Payment Date occurs. 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.
The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Policy") issued by Financial Security Assurance Inc. (the
"Note Insurer"), pursuant to which the Note Insurer has unconditionally
guaranteed payments of the Scheduled Payments (as defined in the Policy), all as
more fully set forth in the Indenture.
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 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.
A-1-2
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.
CPS AUTO RECEIVABLES TRUST 2008-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity,
but solely as Owner Trustee
By: ________________________________
Name: ________________________________
Title: ________________________________
A-1-3
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, not in its individual
capacity, but solely as Trustee
By: _______________________________
Authorized Signatory
Date: ____________, 20__
A-1-4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its Class A-1 3.4695% Asset-Backed Notes (herein called the "Class
A-1 Notes"), all issued under an Indenture dated as of March 1, 2008 (such
indenture, as supplemented or amended, is herein called the "Indenture"),
between the Issuer and Xxxxx Fargo Bank, National Association, as trustee (the
"Trustee", which term includes any successor Trustee 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 Trustee and the Holders of the Notes. The Notes are subject to all
terms of the Indenture. All terms used in this Note that are defined in the
Indenture, supplemented or amended, shall have the meanings assigned to them in
or pursuant to the Indenture, as so supplemented or amended.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture.
Principal of the Class A-1 Notes will be payable on each Payment Date
in an amount described on the face hereof. "Payment Date" means the fifteenth
day of each month, or, if any such date is not a Business Day, the next
succeeding Business Day, commencing April 15, 2008.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the earlier of the Class A-1 Final Scheduled Payment
Date and the Redemption Date, if any, pursuant to Section 10.1 of the Indenture.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable (i) on the date on which an Event of Default shall have
occurred and be continuing so long as an Insurer Default shall not have occurred
and be continuing and the Note Insurer has declared the Notes to be immediately
due and payable in the manner provided in Section 5.2 of the Indenture, or (ii)
if an Insurer Default shall have occurred and be continuing, on the date on
which an Event of Default shall have occurred and be continuing and the Trustee
or a Note Majority has declared the Notes to be immediately due and payable in
the manner provided in Section 5.2 of the Indenture. All principal payments on
the Class A-1 Notes shall be made pro rata to the Class A-1 Noteholders entitled
thereto.
Payments of interest on this Note due and payable on each Payment Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made by check mailed to the Person whose name
appears as the Holder of this Note (or one or more Predecessor Notes) in the
Note Register as of the close of business on each Record Date or by wire
transfer of immediately available funds to the account designated in writing to
the Trustee by such Person at least five Business Days prior to the related
Record Date, except that 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 checks shall be mailed to
the Person entitled thereto at the address of such Person as it appears on the
Note Register as of the applicable Record Date 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
A-1-5
on any Payment Date shall be binding upon all future Holders 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 Payment Date, then the
Trustee, in the name of and on behalf of the Issuer, will notify the Person who
was the Holder hereof as of the Record Date preceding such Payment Date by
notice mailed prior to such Payment Date and the amount then due and payable
shall be payable only upon presentation and surrender of this Note at the
Trustee's principal Corporate Trust Office.
The Issuer shall pay interest on overdue installments of interest at
the Class A-1 Interest Rate to the extent lawful.
As provided in the Indenture, the Notes may be redeemed pursuant to
Section 10.1 of the Indenture, in whole, but not in part, at the option of the
Servicer, on any Payment Date on or after the date on which the Pool Balance is
less than or equal to 10% of the Original Pool Balance.
The Seller or its designated affiliate has the option to purchase from
the Issuer on the last day of each Collection Period (i) any Defaulted Texas
Receivables and (ii) Receivables the aggregate Principal Balance of which may
not on a cumulative basis exceed 1% of the Original Pool Balance.
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, (i) duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by, the Holder hereof or his attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar which requirements include
membership or participation in Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Note Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Exchange Act, and (ii) accompanied by such other documents
as the Trustee may require, and thereupon one or more new Notes of 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. Notwithstanding anything to the contrary in the Indenture or any other
Basic Document, (i) the transfer of a Note, including the right to receive
principal and any stated interest thereon, may be effected only by surrender of
the old Note (or satisfactory evidence of the destruction, loss or theft of such
Note) to the Note Registrar, and the issuance by the Issuer (through the Note
Registrar) of a new Note to the new Holder, and (ii) each Note must be
registered in the name of the Holder thereof as to both principal and any stated
interest with the Note Registrar.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note agrees to treat the Notes as
indebtedness of the Issuer for Federal and State income tax reporting purposes
and further covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
A-1-6
the Trustee on the Notes or under the Indenture or any certificate or other
writing delivered in connection therewith, against (i) the Seller, the Servicer,
the Depositor, the Trustee or the Owner Trustee 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 Issuer, the Seller, the
Servicer, the Depositor, the Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Seller, the
Servicer, the Depositor, the Owner Trustee or the Trustee or of any successor or
assign of the Issuer, the Seller, the Servicer, the Depositor, the Trustee or
the Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Trustee and the Owner Trustee
have no such obligations in their individual capacity) 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.
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 will not at any
time institute against the Depositor or the Issuer or join in any institution
against the Depositor 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, the Indenture or the Basic Documents.
Each Noteholder by its acquisition of any Notes (or a beneficial
interest therein) shall be deemed to have represented and warranted for the
benefit of the Issuer, the Trustee, the Owner Trustee and the Noteholders, that
either (i) it is not acquiring any Notes with the assets of any "employee
benefit plan" as defined in Section 3(3) of ERISA which is subject to Title I of
ERISA or any "plan" as defined in Section 4975 of the Internal Revenue Code or
(ii) the acquisition and holding of the Notes will be covered by Prohibited
Transaction Class Exemption ("PTCE") 00-00, XXXX 00-0, XXXX 91-38, XXXX 00-00,
XXXX 96-23 or a similar U.S. Department of Labor class exemption or other
similar exemption.
Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Trustee and the Note Insurer and any agent of the Issuer, the
Trustee or the Note Insurer 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 neither the Issuer, the Trustee nor any such agent
shall be affected by notice to the contrary.
The Indenture permits, subject to certain limitations and exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Note Insurer (unless
an Insurer Default has occurred and is continuing) but without the consent of
Noteholders. The Indenture also contains provisions permitting the Note Insurer
and/or the Holders of Notes representing specified percentages of the
Outstanding Amount of each class of Notes, on behalf of the Holders of all the
Notes, 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 Holder of this Note (or any one of more
Predecessor Notes) shall be conclusive and binding upon such Holder and upon all
A-1-7
future Holders 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
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Notes issued thereunder.
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 Trustee and the Holders of
Notes 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 construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
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 Indenture or the Basic Documents, neither the Owner Trustee in
its individual capacity, any owner of a beneficial interest in the Issuer, nor
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 of or interest on,
or performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in this Note or the Indenture, it being expressly
understood that said covenants, obligations and indemnifications have been made
by the Owner Trustee for the sole purposes of binding the interests of the Owner
Trustee in the assets of the Issuer. The Holder of this Note by the acceptance
hereof agrees that except as expressly provided in the Indenture or the Basic
Documents, in the case of an Event of Default under the Indenture, the Holder
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-1-8
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: _________________________
1/ Signature Guaranteed:________________________
1/ NOTE: 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 whatsoever.
X-0-0
XXXXXXX X-0
[Form of Class A-2 Note]
REGISTERED $_______________
NO. R-A2 - [__]
SEE REVERSE FOR CERTAIN DEFINITIONS
CUSIP NO. 126190A B3
[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.]
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES ("BLUE SKY LAWS"), AND THIS NOTE MAY NOT BE
OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE 1933 ACT IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, (C) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED
UNDER THE 1933 ACT (IF AVAILABLE) OR (D) TO THE SELLER OR AN AFFILIATE OF THE
SELLER, IN EACH CASE IN ACCORDANCE WITH THE INDENTURE AND ALL APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF THE EXEMPTION
PROVIDED BY RULE 144A FOR RESALES OF THIS 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.
CPS AUTO RECEIVABLES TRUST 2008-A
CLASS A-2 4.95% ASSET-BACKED NOTES
CPS Auto Receivables Trust 2008-A, a statutory 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
A-2-1
registered assigns, the principal sum of ___________________________________ AND
NO/100 DOLLARS payable on each Payment Date in an amount equal to the aggregate
amount, if any, payable from the Note Distribution Account in respect of
principal on the Class A-2 Notes pursuant to Section 3.1 of the Indenture and
Section 5.7 of the Sale and Servicing Agreement provided, however, that the
entire unpaid principal amount of this Note shall be due and payable on the
Payment Date occurring in November 2011 (the "Class A-2 Final Scheduled Payment
Date"). The Issuer will pay interest on this Note at the rate per annum shown
above on each Payment 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 Payment Date (after giving effect to all payments of principal made on
the preceding Payment Date). Interest on this Note will accrue for each Payment
Date from and including the fifteenth day of the month immediately preceding
such Payment Date to and including the fourteenth day of the month in which such
Payment Date occurs; provided that for the April 2008 Payment Date interest will
accrue for the number of days from and including the Closing Date to and
including April 14, 2008. 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.
The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Policy") issued by Financial Security Assurance Inc. (the
"Note Insurer"), pursuant to which the Note Insurer has unconditionally
guaranteed payments of the Scheduled Payments (as defined in the Policy), all as
more fully set forth in the Indenture.
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 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.
A-2-2
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.
CPS AUTO RECEIVABLES TRUST 2008-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity,
but solely as Owner Trustee
By: _______________________________
Name: _______________________________
Title: _______________________________
A-2-3
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
XXXXX FARGO BANK, NATIONAL
ASSOCIATION,
not in its individual capacity, but
solely as Trustee
By: ____________________________
Authorized Signatory_________________
Date: ___________, 20__
A-2-4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its Class A-2 4.95% Asset-Backed Notes (herein called the "Class
A-2 Notes"), all issued under an Indenture dated as of March 1, 2008 (such
indenture, as supplemented or amended, is herein called the "Indenture"),
between the Issuer and Xxxxx Fargo Bank, National Association, as trustee (the
"Trustee", which term includes any successor Trustee 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 Trustee and the Holders of the Notes. The Notes are subject to all
terms of the Indenture. All terms used in this Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture.
Principal of the Class A-2 Notes will be payable on each Payment Date
in an amount described on the face hereof. "Payment Date" means the fifteenth
day of each month, or, if any such date is not a Business Day, the next
succeeding Business Day, commencing April 15, 2008.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the earlier of the Class A-2 Final Scheduled Payment
Date and the Redemption Date, if any, pursuant to Section 10.1 of the Indenture.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable (i) on the date on which an Event of Default shall have
occurred and be continuing so long as an Insurer Default shall not have occurred
and be continuing and the Note Insurer has declared the Notes to be immediately
due and payable in the manner provided in Section 5.2 of the Indenture, or (ii)
if an Insurer Default shall have occurred and be continuing, on the date on
which an Event of Default shall have occurred and be continuing and the Trustee
or a Note Majority has declared the Notes to be immediately due and payable in
the manner provided in Section 5.2 of the Indenture. All principal payments on
the Class A-2 Notes shall be made pro rata to the Class A-2 Noteholders entitled
thereto.
Payments of interest on this Note due and payable on each Payment Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made by check mailed to the Person whose name
appears as the Holder of this Note (or one or more Predecessor Notes) in the
Note Register as of the close of business on each Record Date or by wire
transfer of immediately available funds to the account designated in writing to
the Trustee by such Person at least five Business Days prior to the related
Record Date, except that 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 checks shall be mailed to
the Person entitled thereto at the address of such Person as it appears on the
Note Register as of the applicable Record Date 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
A-2-5
on any Payment Date shall be binding upon all future Holders 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 Payment Date, then the
Trustee, in the name of and on behalf of the Issuer, will notify the Person who
was the Holder hereof as of the Record Date preceding such Payment Date by
notice mailed prior to such Payment Date and the amount then due and payable
shall be payable only upon presentation and surrender of this Note at the
Trustee's principal Corporate Trust Office.
The Issuer shall pay interest on overdue installments of interest at
the Class A-2 Interest Rate to the extent lawful.
As provided in the Indenture, the Notes may be redeemed pursuant to
Section 10.1 of the Indenture, in whole, but not in part, at the option of the
Servicer, on any Payment Date on or after the date on which the Pool Balance is
less than or equal to 10% of the Original Pool Balance.
The Seller or its designated affiliate has the option to purchase from
the Issuer on the last day of each Collection Period (i) any Defaulted Texas
Receivables and (ii) Receivables the aggregate Principal Balance of which may
not on a cumulative basis exceed 1% of the Original Pool Balance.
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, (i) duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by, the Holder hereof or his attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar which requirements include
membership or participation in Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Note Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Exchange Act, and (ii) accompanied by such other documents
as the Trustee may require, and thereupon one or more new Notes of 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. Notwithstanding anything to the contrary in the Indenture or any other
Basic Document, (i) the transfer of a Note, including the right to receive
principal and any stated interest thereon, may be effected only by surrender of
the old Note (or satisfactory evidence of the destruction, loss or theft of such
Note) to the Note Registrar, and the issuance by the Issuer (through the Note
Registrar) of a new Note to the new Holder, and (ii) each Note must be
registered in the name of the Holder thereof as to both principal and any stated
interest with the Note Registrar.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note agrees to treat the Notes as
indebtedness of the Issuer for federal and State income tax reporting purposes
and further 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 Trustee on the Notes or under the Indenture or any certificate or other
A-2-6
writing delivered in connection therewith, against (i) the Seller, the Servicer,
the Depositor, the Trustee or the Owner Trustee 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 Issuer, the Seller, the
Servicer, the Depositor, the Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Seller, the
Servicer, the Depositor, the Owner Trustee or the Trustee or of any successor or
assign of the Issuer, the Seller, the Servicer, the Depositor, the Trustee or
the Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Trustee and the Owner Trustee
have no such obligations in their individual capacity) 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.
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 will not at any
time institute against the Depositor or the Issuer or join in any institution
against the Depositor 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, the Indenture or the Basic Documents.
Each Noteholder by its acquisition of any Notes (or a beneficial
interest therein) shall be deemed to have represented and warranted for the
benefit of the Issuer, the Trustee, the Owner Trustee and the Noteholders, that
either (i) it is not acquiring any Notes with the assets of any "employee
benefit plan" as defined in Section 3(3) of ERISA which is subject to Title I of
ERISA or any "plan" as defined in Section 4975 of the Internal Revenue Code or
(ii) the acquisition and holding of the Notes will be covered by Prohibited
Transaction Class Exemption ("PTCE") 00-00, XXXX 00-0, XXXX 91-38, XXXX 00-00,
XXXX 96-23 or a similar U.S. Department of Labor class exemption or other
similar exemption.
Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Trustee and the Note Insurer and any agent of the Issuer, the
Trustee or the Note Insurer 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 neither the Issuer, the Trustee nor any such agent
shall be affected by notice to the contrary.
The Indenture permits, subject to certain limitations and exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Note Insurer (unless
an Insurer Default has occurred and is continuing) but without the consent of
Noteholders. The Indenture also contains provisions permitting the Note Insurer
and/or the Holders of Notes representing specified percentages of the
Outstanding Amount of each class of Notes, on behalf of the Holders of all the
Notes, 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 Holder of this Note (or any one of more
Predecessor Notes) shall be conclusive and binding upon such Holder and upon all
A-2-7
future Holders 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
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Notes issued thereunder.
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 Trustee and the Holders of
Notes 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 construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
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 Indenture or the Basic Documents, neither the Owner Trustee in
its individual capacity, any owner of a beneficial interest in the Issuer, nor
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 of or interest on,
or performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in this Note or the Indenture, it being expressly
understood that said covenants, obligations and indemnifications have been made
by the Owner Trustee for the sole purposes of binding the interests of the Owner
Trustee in the assets of the Issuer. The Holder of this Note by the acceptance
hereof agrees that except as expressly provided in the Indenture or the Basic
Documents, in the case of an Event of Default under the Indenture, the Holder
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-2-8
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: _________________________
1/ Signature Guaranteed:________________________
1/ NOTE: 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 whatsoever.
X-0-0
XXXXXXX X-0
[Form of Class A-3 Note]
REGISTERED $_______________
NO. R-A3-[__]
SEE REVERSE FOR CERTAIN DEFINITIONS
CUSIP NO. 126190A C1
[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.]
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES ("BLUE SKY LAWS"), AND THIS NOTE MAY NOT BE
OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE 1933 ACT IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, (C) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED
UNDER THE 1933 ACT (IF AVAILABLE) OR (D) TO THE SELLER OR AN AFFILIATE OF THE
SELLER, IN EACH CASE IN ACCORDANCE WITH THE INDENTURE AND ALL APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF THE EXEMPTION
PROVIDED BY RULE 144A FOR RESALES OF THIS 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.
CPS AUTO RECEIVABLES TRUST 2008-A
CLASS A-3 6.48% ASSET-BACKED NOTES
CPS Auto Receivables Trust 2008-A, a statutory 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
A-3-1
registered assigns, the principal sum of ___________________________________ AND
NO/100 DOLLARS payable on each Payment Date in an amount equal to the aggregate
amount, if any, payable from the Note Distribution Account in respect of
principal on the Class A-3 Notes pursuant to Section 3.1 of the Indenture and
Section 5.7 of the Sale and Servicing Agreement provided, however, that the
entire unpaid principal amount of this Note shall be due and payable on the
Payment Date occurring in July 2013 (the "Class A-3 Final Scheduled Payment
Date"). The Issuer will pay interest on this Note at the rate per annum shown
above on each Payment 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 Payment Date (after giving effect to all payments of principal made on
the preceding Payment Date). Interest on this Note will accrue for each Payment
Date from and including the fifteenth day of the month immediately preceding
such Payment Date to and including the fourteenth day of the month in which such
Payment Date occurs; provided that for the April 2008 Payment Date interest will
accrue for the number of days from and including the Closing Date to and
including April 14, 2008. 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.
The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Policy") issued by Financial Security Assurance Inc. (the
"Note Insurer"), pursuant to which the Note Insurer has unconditionally
guaranteed payments of the Scheduled Payments (as defined in the Policy), all as
more fully set forth in the Indenture.
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 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.
A-3-2
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.
CPS AUTO RECEIVABLES TRUST 2008-A
By: WILMINGTON TRUST COMPANY,
not in its individual
capacity, but solely as Owner
Trustee
By: _____________________________
Name: _____________________________
Title: _____________________________
A-3-3
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity, but solely
as Trustee
By: __________________________________
Authorized Signatory_______________________
Date: ___________, 20__
A-3-4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its Class A-3 6.48% Asset-Backed Notes (herein called the "Class
A-3 Notes"), all issued under an Indenture dated as of March 1, 2008 (such
indenture, as supplemented or amended, is herein called the "Indenture"),
between the Issuer and Xxxxx Fargo Bank, National Association, as trustee (the
"Trustee", which term includes any successor Trustee 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 Trustee and the Holders of the Notes. The Notes are subject to all
terms of the Indenture. All terms used in this Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture.
Principal of the Class A-3 Notes will be payable on each Payment Date
in an amount described on the face hereof. "Payment Date" means the fifteenth
day of each month, or, if any such date is not a Business Day, the next
succeeding Business Day, commencing April 15, 2008.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the earlier of the Class A-3 Final Scheduled Payment
Date and the Redemption Date, if any, pursuant to Section 10.1 of the Indenture.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable (i) on the date on which an Event of Default shall have
occurred and be continuing so long as an Insurer Default shall not have occurred
and be continuing and the Note Insurer has declared the Notes to be immediately
due and payable in the manner provided in Section 5.2 of the Indenture, or (ii)
if an Insurer Default shall have occurred and be continuing, on the date on
which an Event of Default shall have occurred and be continuing and the Trustee
or a Note Majority has declared the Notes to be immediately due and payable in
the manner provided in Section 5.2 of the Indenture. All principal payments on
the Class A-3 Notes shall be made pro rata to the Class A-3 Noteholders entitled
thereto.
Payments of interest on this Note due and payable on each Payment Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made by check mailed to the Person whose name
appears as the Holder of this Note (or one or more Predecessor Notes) in the
Note Register as of the close of business on each Record Date or by wire
transfer of immediately available funds to the account designated in writing to
the Trustee by such Person at least five Business Days prior to the related
Record Date, except that 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 checks shall be mailed to
the Person entitled thereto at the address of such Person as it appears on the
Note Register as of the applicable Record Date 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
A-3-5
on any Payment Date shall be binding upon all future Holders 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 Payment Date, then the
Trustee, in the name of and on behalf of the Issuer, will notify the Person who
was the Holder hereof as of the Record Date preceding such Payment Date by
notice mailed prior to such Payment Date and the amount then due and payable
shall be payable only upon presentation and surrender of this Note at the
Trustee's principal Corporate Trust Office.
The Issuer shall pay interest on overdue installments of interest at
the Class A-3 Interest Rate to the extent lawful.
As provided in the Indenture, the Notes may be redeemed pursuant to
Section 10.1 of the Indenture, in whole, but not in part, at the option of the
Servicer, on any Payment Date on or after the date on which the Pool Balance is
less than or equal to 10% of the Original Pool Balance.
The Seller or its designated affiliate has the option to purchase from
the Issuer on the last day of each Collection Period (i) any Defaulted Texas
Receivables and (ii) Receivables the aggregate Principal Balance of which may
not on a cumulative basis exceed 1% of the Original Pool Balance.
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, (i) duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by, the Holder hereof or his attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar which requirements include
membership or participation in Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Note Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Exchange Act, and (ii) accompanied by such other documents
as the Trustee may require, and thereupon one or more new Notes of 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. Notwithstanding anything to the contrary in the Indenture or any other
Basic Document, (i) the transfer of a Note, including the right to receive
principal and any stated interest thereon, may be effected only by surrender of
the old Note (or satisfactory evidence of the destruction, loss or theft of such
Note) to the Note Registrar, and the issuance by the Issuer (through the Note
Registrar) of a new Note to the new Holder, and (ii) each Note must be
registered in the name of the Holder thereof as to both principal and any stated
interest with the Note Registrar.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note agrees to treat the Notes as
indebtedness of the Issuer for federal and State income tax reporting purposes
and further covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
A-3-6
the Trustee on the Notes or under the Indenture or any certificate or other
writing delivered in connection therewith, against (i) the Seller, the Servicer,
the Depositor, the Trustee or the Owner Trustee 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 Issuer, the Seller, the
Servicer, the Depositor, the Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Seller, the
Servicer, the Depositor, the Owner Trustee or the Trustee or of any successor or
assign of the Issuer, the Seller, the Servicer, the Depositor, the Trustee or
the Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Trustee and the Owner Trustee
have no such obligations in their individual capacity) 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.
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 will not at any
time institute against the Depositor or the Issuer or join in any institution
against the Depositor 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, the Indenture or the Basic Documents.
Each Noteholder by its acquisition of any Notes (or a beneficial
interest therein) shall be deemed to have represented and warranted for the
benefit of the Issuer, the Trustee, the Owner Trustee and the Noteholders, that
either (i) it is not acquiring any Notes with the assets of any "employee
benefit plan" as defined in Section 3(3) of ERISA which is subject to Title I of
ERISA or any "plan" as defined in Section 4975 of the Internal Revenue Code or
(ii) the acquisition and holding of the Notes will be covered by Prohibited
Transaction Class Exemption ("PTCE") 00-00, XXXX 00-0, XXXX 91-38, XXXX 00-00,
XXXX 96-23 or a similar U.S. Department of Labor class exemption or other
similar exemption.
Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Trustee and the Note Insurer and any agent of the Issuer, the
Trustee or the Note Insurer 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 neither the Issuer, the Trustee nor any such agent
shall be affected by notice to the contrary.
The Indenture permits, subject to certain limitations and exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Note Insurer (unless
an Insurer Default has occurred and is continuing) but without the consent of
Noteholders. The Indenture also contains provisions permitting the Note Insurer
and/or the Holders of Notes representing specified percentages of the
Outstanding Amount of each class of Notes, on behalf of the Holders of all the
Notes, to waive compliance by the Issuer with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
A-3-7
Any such consent or waiver by the Holder of this Note (or any one of more
Predecessor Notes) shall be conclusive and binding upon such Holder and upon all
future Holders 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
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Notes issued thereunder.
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 Trustee and the Holders of
Notes 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 construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
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 Indenture or the Basic Documents, neither the Owner Trustee in
its individual capacity, any owner of a beneficial interest in the Issuer, nor
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 of or interest on,
or performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in this Note or the Indenture, it being expressly
understood that said covenants, obligations and indemnifications have been made
by the Owner Trustee for the sole purposes of binding the interests of the Owner
Trustee in the assets of the Issuer. The Holder of this Note by the acceptance
hereof agrees that except as expressly provided in the Indenture or the Basic
Documents, in the case of an Event of Default under the Indenture, the Holder
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-3-8
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: _________________________
1/ Signature Guaranteed:________________________
1/ NOTE: 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 whatsoever.
X-0-0
XXXXXXX X-0
[Form of Class A-4 Note]
REGISTERED $_______________
NO. R-A4-[__]
SEE REVERSE FOR CERTAIN DEFINITIONS
CUSIP NO. 126190A D9
[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.]
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES ("BLUE SKY LAWS"), AND THIS NOTE MAY NOT BE
OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE 1933 ACT IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE 1933 ACT, (C) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED
UNDER THE 1933 ACT (IF AVAILABLE) OR (D) TO THE SELLER OR AN AFFILIATE OF THE
SELLER, IN EACH CASE IN ACCORDANCE WITH THE INDENTURE AND ALL APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF THE EXEMPTION
PROVIDED BY RULE 144A FOR RESALES OF THIS 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.
CPS AUTO RECEIVABLES TRUST 2008-A
CLASS A-4 7.13% ASSET-BACKED NOTES
CPS Auto Receivables Trust 2008-A, a statutory 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
A-4-1
registered assigns, the principal sum of ___________________________________ AND
NO/100 DOLLARS payable on each Payment Date in an amount equal to the aggregate
amount, if any, payable from the Note Distribution Account in respect of
principal on the Class A-4 Notes pursuant to Section 3.1 of the Indenture and
Section 5.7 of the Sale and Servicing Agreement provided, however, that the
entire unpaid principal amount of this Note shall be due and payable on the
Payment Date occurring in October 2014 (the "Class A-4 Final Scheduled Payment
Date"). The Issuer will pay interest on this Note at the rate per annum shown
above on each Payment 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 Payment Date (after giving effect to all payments of principal made on
the preceding Payment Date). Interest on this Note will accrue for each Payment
Date from and including the fifteenth day of the month immediately preceding
such Payment Date to and including the fourteenth day of the month in which such
Payment Date occurs; provided that for the April 2008 Payment Date interest will
accrue for the number of days from and including the Closing Date to and
including April 14, 2008. 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.
The Notes are entitled to the benefits of a financial guaranty
insurance policy (the "Policy") issued by Financial Security Assurance Inc. (the
"Note Insurer"), pursuant to which the Note Insurer has unconditionally
guaranteed payments of the Scheduled Payments (as defined in the Policy), all as
more fully set forth in the Indenture.
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 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.
A-4-2
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.
CPS AUTO RECEIVABLES TRUST 2008-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity,
but solely as Owner Trustee
By: _______________________________
Name: _______________________________
Title: _______________________________
A-4-3
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Trustee
By: _____________________________
Authorized Signatory__________________
Date: ___________, 20__
A-4-4
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its Class A-4 7.13% Asset-Backed Notes (herein called the "Class
A-4 Notes"), all issued under an Indenture dated as of March 1, 2008 (such
indenture, as supplemented or amended, is herein called the "Indenture"),
between the Issuer and Xxxxx Fargo Bank, National Association, as trustee (the
"Trustee", which term includes any successor Trustee 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 Trustee and the Holders of the Notes. The Notes are subject to all
terms of the Indenture. All terms used in this Note that are defined in the
Indenture, as supplemented or amended, shall have the meanings assigned to them
in or pursuant to the Indenture, as so supplemented or amended.
The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class A-4 Notes (collectively, the "Notes") are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture.
Principal of the Class A-4 Notes will be payable on each Payment Date
in an amount described on the face hereof. "Payment Date" means the fifteenth
day of each month, or, if any such date is not a Business Day, the next
succeeding Business Day, commencing April 15, 2008.
As described above, the entire unpaid principal amount of this Note
shall be due and payable on the earlier of the Class A-4 Final Scheduled Payment
Date and the Redemption Date, if any, pursuant to Section 10.1 of the Indenture.
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable (i) on the date on which an Event of Default shall have
occurred and be continuing so long as an Insurer Default shall not have occurred
and be continuing and the Note Insurer has declared the Notes to be immediately
due and payable in the manner provided in Section 5.2 of the Indenture, or (ii)
if an Insurer Default shall have occurred and be continuing, on the date on
which an Event of Default shall have occurred and be continuing and the Trustee
or a Note Majority has declared the Notes to be immediately due and payable in
the manner provided in Section 5.2 of the Indenture. All principal payments on
the Class A-4 Notes shall be made pro rata to the Class A-4 Noteholders entitled
thereto.
Payments of interest on this Note due and payable on each Payment Date,
together with the installment of principal, if any, to the extent not in full
payment of this Note, shall be made by check mailed to the Person whose name
appears as the Holder of this Note (or one or more Predecessor Notes) in the
Note Register as of the close of business on each Record Date or by wire
transfer of immediately available funds to the account designated in writing to
the Trustee by such Person at least five Business Days prior to the related
Record Date, except that 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 checks shall be mailed to
the Person entitled thereto at the address of such Person as it appears on the
Note Register as of the applicable Record Date 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 Payment Date shall be binding upon all future Holders of this Note and of
any Note issued upon the registration of transfer hereof or in exchange hereof
A-4-5
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 Payment Date, then the
Trustee, in the name of and on behalf of the Issuer, will notify the Person who
was the Holder hereof as of the Record Date preceding such Payment Date by
notice mailed prior to such Payment Date and the amount then due and payable
shall be payable only upon presentation and surrender of this Note at the
Trustee's principal Corporate Trust Office.
The Issuer shall pay interest on overdue installments of interest at
the Class A-4 Interest Rate to the extent lawful.
As provided in the Indenture, the Notes may be redeemed pursuant to
Section 10.1 of the Indenture, in whole, but not in part, at the option of the
Servicer, on any Payment Date on or after the date on which the Pool Balance is
less than or equal to 10% of the Original Pool Balance.
The Seller or its designated affiliate has the option to purchase from
the Issuer on the last day of each Collection Period (i) any Defaulted Texas
Receivables and (ii) Receivables the aggregate Principal Balance of which may
not on a cumulative basis exceed 1% of the Original Pool Balance.
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, (i) duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by, the Holder hereof or his attorney duly authorized in
writing, with such signature guaranteed by an "eligible guarantor institution"
meeting the requirements of the Note Registrar which requirements include
membership or participation in Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Note Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Exchange Act, and (ii) accompanied by such other documents
as the Trustee may require, and thereupon one or more new Notes of 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. Notwithstanding anything to the contrary in the Indenture or any other
Basic Document, (i) the transfer of a Note, including the right to receive
principal and any stated interest thereon, may be effected only by surrender of
the old Note (or satisfactory evidence of the destruction, loss or theft of such
Note) to the Note Registrar, and the issuance by the Issuer (through the Note
Registrar) of a new Note to the new Holder, and (ii) each Note must be
registered in the name of the Holder thereof as to both principal and any stated
interest with the Note Registrar.
Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note agrees to treat the Notes as
indebtedness of the Issuer for federal and State income tax reporting purposes
and further 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 Trustee on the Notes or under the Indenture or any certificate or other
A-4-6
writing delivered in connection therewith, against (i) the Seller, the Servicer,
the Depositor, the Trustee or the Owner Trustee 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 Issuer, the Seller, the
Servicer, the Depositor, the Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Seller, the
Servicer, the Depositor, the Owner Trustee or the Trustee or of any successor or
assign of the Issuer, the Seller, the Servicer, the Depositor, the Trustee or
the Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Trustee and the Owner Trustee
have no such obligations in their individual capacity) 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.
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 will not at any
time institute against the Depositor or the Issuer or join in any institution
against the Depositor 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, the Indenture or the Basic Documents.
Each Noteholder by its acquisition of any Notes (or a beneficial
interest therein) shall be deemed to have represented and warranted for the
benefit of the Issuer, the Trustee, the Owner Trustee and the Noteholders, that
either (i) it is not acquiring any Notes with the assets of any "employee
benefit plan" as defined in Section 3(3) of ERISA which is subject to Title I of
ERISA or any "plan" as defined in Section 4975 of the Internal Revenue Code or
(ii) the acquisition and holding of the Notes will be covered by Prohibited
Transaction Class Exemption ("PTCE") 00-00, XXXX 00-0, XXXX 91-38, XXXX 00-00,
XXXX 96-23 or a similar U.S. Department of Labor class exemption or other
similar exemption.
Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Trustee and the Note Insurer and any agent of the Issuer, the
Trustee or the Note Insurer 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 neither the Issuer, the Trustee nor any such agent
shall be affected by notice to the contrary.
The Indenture permits, subject to certain limitations and exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Note Insurer (unless
an Insurer Default has occurred and is continuing) but without the consent of
Noteholders. The Indenture also contains provisions permitting the Note Insurer
and/or the Holders of Notes representing specified percentages of the
Outstanding Amount of each class of Notes, on behalf of the Holders of all the
Notes, 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 Holder of this Note (or any one of more
Predecessor Notes) shall be conclusive and binding upon such Holder and upon all
A-4-7
future Holders 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
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Notes issued thereunder.
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 Trustee and the Holders of
Notes 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 construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
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 Indenture or the Basic Documents, neither the Owner Trustee in
its individual capacity, any owner of a beneficial interest in the Issuer, nor
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 of or interest on,
or performance of, or omission to perform, any of the covenants, obligations or
indemnifications contained in this Note or the Indenture, it being expressly
understood that said covenants, obligations and indemnifications have been made
by the Owner Trustee for the sole purposes of binding the interests of the Owner
Trustee in the assets of the Issuer. The Holder of this Note by the acceptance
hereof agrees that except as expressly provided in the Indenture or the Basic
Documents, in the case of an Event of Default under the Indenture, the Holder
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-4-8
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: _________________________
1/ Signature Guaranteed:________________________
1/ NOTE: 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 whatsoever.
A-4-9
EXHIBIT B
FORM OF TRANSFEREE REPRESENTATION LETTER
_____________, 20___
Xxxxx Fargo Bank, National Association, as Note Registrar
MAC X0000-000, Xxxxx Xxxxxx & Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust Services/Asset Backed Administration, CPS 2008-A
Re: CPS Auto Receivables Trust 2008-A
[Class A-1][Class A-2][Class A-3][Class A-4] Note (the "Notes")
Dear Sirs:
This letter is delivered to you in connection with the transfer by
________________ (the "Transferor") to ____________________________ (the
"Transferee") of the captioned Notes (the "Notes"), pursuant to Section 2.13(a)
of the Indenture (the "Indenture"), dated as of March 1, 2008, between CPS Auto
Receivables Trust 2008-A, as Issuer, and Xxxxx Fargo Bank, National Association,
as Trustee. All terms used herein and not otherwise defined shall have the
respective meanings set forth in the Indenture. The Transferee hereby certifies,
represents and warrants to you, as Note Registrar, that:
1. The Transferee is a "qualified institutional buyer" as that term is
defined in Rule 144A ("Rule 144A") under the Securities Act of 1933, as amended
(the "Securities Act") and has completed one of the forms of certification to
that effect attached hereto as Annex 1 and Annex 2. The Transferee is aware that
the sale to it is being made in reliance on Rule 144A. The Transferee is
acquiring the Notes for its own account or for the account of a qualified
institutional buyer. The Transferee understands that the Notes have not been and
will not be registered under the Securities Act or any State securities laws,
that neither the Transferor nor the Note Registrar is required to so register
the Notes, and that the Notes may be resold, pledged or transferred only (x) to
a person reasonably believed to be a qualified institutional buyer that
purchases for its own account or for the account of a qualified institutional
buyer to whom notice is given that the resale, pledge or transfer is being made
in reliance on Rule 144A or (y) pursuant to another exemption from registration
under the Securities Act.
2. The Transferee is not a pension, profit-sharing or other employee
benefit plan within the meaning of Section 3(3) of ERISA or an individual
retirement account, a Xxxxx plan or any other plan within the meaning of Section
4975 of the Internal Revenue Code of 1986, as amended (each, a "Benefit Plan")
and is not acquiring any Notes with the assets of a Benefit Plan or its
acquisition and continued holding of such Note will be covered by Prohibited
Transaction Class Exemption ("PTCE") 00-00, XXXX 00-0, XXXX 91-38, PTCE 95-60,
B-1
PTCE 96-23 or a similar U.S. Department of Labor class exemption or other
similar exemption.
3. The Transferee has received a copy of the Confidential Private
Placement Memorandum dated April 8, 2008, relating to the Notes and has been
furnished with all information that it has requested regarding (a) the Notes and
payments thereon, (b) the Trust Estate, and (c) the Indenture. The Transferee
understands that substantial risks are involved in an investment in the Notes
and the Transferee represents that in making its investment decision to acquire
the Notes, it has not relied on representations, warranties, opinions,
projections, financial or other information or analysis, if any, supplied to it
by any person, including Bear, Xxxxxxx & Co. Inc., X.X. Xxxxxx Securities Inc.
or UBS Securities LLC, as Placement Agents, except as expressly set forth in the
Confidential Private Placement Memorandum. The Transferee has had an
opportunity, within a reasonable period of time prior to purchasing the Notes,
to ask questions concerning the Notes and the Trust Estate and has received
satisfactory answers to such questions.
4. The Transferee will comply with all applicable federal and State
securities laws, rules and regulations in connection with any subsequent resale
of the Notes by the Transferee.
5. The Transferee understands that the Notes may not be presented or
surrendered to the Note Registrar or any Transfer Agent for registration of
transfer or for exchange unless they are accompanied by (i) a written instrument
of transfer in form satisfactory to the Note Registrar, duly executed by the
holder thereof or his attorney duly authorized in writing, with guaranty of
signature and (ii) either (A) a Transferee Letter from the person transferring
such Note in the form of Exhibit B to the Indenture, or (B) an opinion of
counsel satisfactory to the Note Registrar to the effect that such transfer is
exempt from registration under the Securities Act and applicable State
securities laws.
6. The Transferee understands that the Notes will bear a legend to the
following effect:
"THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"),
OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
("BLUE SKY LAWS"), AND THIS NOTE MAY NOT BE OFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A UNDER THE 1933 ACT IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (B)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933
ACT, (C) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED
UNDER THE 1933 ACT (IF AVAILABLE) OR (D) TO THE SELLER OR AN
AFFILIATE OF THE SELLER, IN EACH CASE IN ACCORDANCE WITH THE
INDENTURE AND ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION. NO
REPRESENTATION IS MADE AS TO THE AVAILABILITY OF THE EXEMPTION
PROVIDED BY RULE 144A FOR RESALES OF THIS NOTE."
B-2
Very truly yours,
___________________________
(Transferee)
By: ____________________
Name: ____________________
Title: ____________________
B-3
ANNEX I TO EXHIBIT B
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor]
(the "Transferor") and Xxxxx Fargo Bank, National Association, as Trustee, with
respect to the Notes (the "Notes") described in the Transferee Certificate to
which this certification relates and to which this certification is an Annex:
(i) As indicated below, the undersigned is the chief
financial officer, a person fulfilling an equivalent function,
or other executive officer of the entity purchasing the Notes
(the "Transferee").
(ii) The Transferee is a "qualified institutional
buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i)
the Transferee owned and/or invested on a discretionary basis
$_________________(1) in securities (other than the excluded
securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being
calculated in accordance with Rule 144A) and (ii) the
Transferee satisfies the criteria in the category marked
below.
___ Corporation, etc. The Transferee is a corporation (other than
a bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or any
organization described in Section 501(c)(3) of the Internal
Revenue Code of 1986.
___ Bank. The Transferee (a) is a national bank or a banking
institution organized under the laws of any State, U.S.
territory or the District of Columbia, the business of which
is substantially confined to banking and is supervised by the
State or territorial banking commission or similar official or
is a foreign bank or equivalent institution, and (b) has an
audited net worth of at least $25,000,000 as demonstrated in
its latest annual financial statements, a copy of which is
attached hereto, as of a date not more than 16 months
preceding the date of sale of the Notes in the case of a U.S.
bank, and not more than 18 months preceding such date of sale
for a foreign bank or equivalent institution.
___ Savings and Loan. The Transferee (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is
supervised and examined by a State or Federal authority having
supervision over any such institutions or is a foreign savings
and loan association or equivalent institution and (b) has an
audited net worth of at least $25,000,000 as demonstrated in
its latest annual financial statements, a copy of which is
attached hereto, as of a date not more than 16 months
preceding the date of sale of the Notes in the case of a U.S.
savings and loan association, and not more than 18 months
preceding such date of sale for a foreign savings and loan
association or equivalent institution.
__________________
(1) Transferee must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Transferee is a dealer, and, in that case,
Transferee must own and/or invest on a discretionary basis at least $10,000,000
in securities.
B-4
___ Broker-dealer. The Transferee is a dealer registered pursuant
to Section 15 of the Securities Exchange Act of 1934.
___ Insurance Company. The Transferee is an insurance company
whose primary and predominant business activity is the writing
of insurance or the reinsuring of risks underwritten by
insurance companies and which is subject to supervision by the
insurance commissioner or a similar official or agency of a
State, U.S. territory or the District of Columbia.
___ State or Local Plan. The Transferee is a plan established and
maintained by a State, its political subdivisions, or any
agency or instrumentality of the State or its political
subdivisions, for the benefit of its employees.
___ ERISA Plan. The Transferee is an employee benefit plan within
the meaning of Title I of the Employee Retirement Income
Security Act of 1974.
___ Investment Advisor. The Transferee is an investment advisor
registered under the Investment Advisers Act of 1940.
___ Other. (Please supply a brief description of the entity and a
cross-reference to the paragraph and subparagraph under
subsection (a)(1) of Rule 144A pursuant to which it qualifies.
Note that registered investment companies should complete
Annex 2 rather than this Annex 1.)
(iii) The term "securities" as used herein does not
include (i) securities of issuers that are affiliated with the
Transferee, (ii) securities that are part of an unsold
allotment to or subscription by the Transferee, if the
Transferee is a dealer, (iii) bank deposit notes and
certificates of deposit, (iv) loan participations, (v)
repurchase agreements, (vi) securities owned but subject to a
repurchase agreement and (vii) currency, interest rate and
commodity swaps. For purposes of determining the aggregate
amount of securities owned and/or invested on a discretionary
basis by the Transferee, the Transferee did not include any of
the securities referred to in this paragraph.
(iv) For purposes of determining the aggregate amount
of securities owned and/or invested on a discretionary basis
by the Transferee, the Transferee used the cost of such
securities to the Transferee, unless the Transferee reports
its securities holdings in its financial statements on the
basis of their market value, and no current information with
respect to the cost of those securities has been published, in
which case the securities were valued at market. Further, in
determining such aggregate amount, the Transferee may have
B-5
included securities owned by subsidiaries of the Transferee,
but only if such subsidiaries are consolidated with the
Transferee in its financial statements prepared in accordance
with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the
Transferee's direction. However, such securities were not
included if the Transferee is a majority-owned, consolidated
subsidiary of another enterprise and the Transferee is not
itself a reporting company under the Securities Exchange Act
of 1934.
(v) The Transferee acknowledges that it is familiar
with Rule 144A and understands that the Transferor and other
parties related to the Notes are relying and will continue to
rely on the statements made herein because one or more sales
to the Transferee may be in reliance on Rule 144A.
___ ___ Will the Transferee be purchasing the Notes
Yes No only for the Transferee's own account?
(vi) If the answer to the foregoing question is "no",
then in each case where the Transferee is purchasing for an
account other than its own, such account belongs to a third
party that is itself a "qualified institutional buyer" within
the meaning of Rule 144A, and the "qualified institutional
buyer" status of such third party has been established by the
Transferee through one or more of the appropriate methods
contemplated by Rule 144A.
(vii) The Transferee will notify each of the parties
to which this certification is made of any changes in the
information and conclusions herein. Until such notice is
given, the Transferee's purchase of the Notes will constitute
a reaffirmation of this certification as of the date of such
purchase. In addition, if the Transferee is a bank or savings
and loan as provided above, the Transferee agrees that it will
furnish to such parties any updated annual financial
statements that become available on or before the date of such
purchase, promptly after they become available.
Print Name of Transferee:
___________________________
By: ____________________
Name: ____________________
Title: ____________________
_______________________
_______________________
Date: ________________
_______________________
_______________________
X-0
XXXXX 0 XX XXXXXXX X
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor]
(the "Transferor") and Xxxxx Fargo Bank, National Association, as Trustee, with
respect to the Notes (the "Notes") described in the Transferee Certificate to
which this certification relates and to which this certification is an Annex:
1. As indicated below, the undersigned is the chief
financial officer, a person fulfilling an equivalent function, or other
executive officer of the entity purchasing the Notes (the "Transferee") or, if
the Transferee is a "qualified institutional buyer" as that term is defined in
Rule 144A under the Securities Act of 1933, as amended ("Rule 144A") because the
Transferee is part of a Family of Investment Companies (as defined below), is an
executive officer of the investment adviser (the "Adviser").
2. The Transferee is a "qualified institutional buyer"
as defined in Rule 144A because (i) the Transferee is an investment company
registered under the Investment Company Act of 1940, as amended, and (ii) as
marked below, the Transferee alone owned and/or invested on a discretionary
basis, or the Transferee's Family of Investment Companies owned, at least
$100,000,000 in securities (other than the excluded securities referred to
below) as of the end of the Transferee's most recent fiscal year. For purposes
of determining the amount of securities owned by the Transferee or the
Transferee's Family of Investment Companies, the cost of such securities was
used, unless the Transferee or any member of the Transferee's Family of
Investment Companies, as the case may be, reports its securities holdings in its
financial statements on the basis of their market value, and no current
information with respect to the cost of those securities has been published, in
which case the securities of such entity were valued at market.
___ The Transferee owned and/or invested on a
discretionary basis $________________ in securities
(other than the excluded securities referred to
below) as of the end of the Transferee's most recent
fiscal year (such amount being calculated in
accordance with Rule 144A).
___ The Transferee is part of a Family of Investment
Companies which owned in the aggregate
$________________ in securities (other than the
excluded securities referred to below) as of the end
of the Transferee's most recent fiscal year (such
amount being calculated in accordance with Rule
144A).
3. The term "Family of Investment Companies" as used
herein means two or more registered investment companies (or series thereof)
that have the same investment adviser or investment advisers that are affiliated
(by virtue of being majority owned subsidiaries of the same parent or because
one investment adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include
(i) securities of issuers that are affiliated with the Transferee or are part of
the Transferee's Family of Investment Companies, (ii) bank deposit notes and
certificates of deposit, (iii) loan participations, (iv) repurchase agreements,
(v) securities owned but subject to a repurchase agreement and (vi) currency,
interest rate and commodity swaps. For purposes of determining the aggregate
amount of securities owned and/or invested on a discretionary basis by the
Transferee, or owned by the Transferee's Family of Investment Companies, the
securities referred to in this paragraph were excluded.
B-7
5. The Transferee is familiar with Rule 144A and
understands that the parties to which this certification is being made are
relying and will continue to rely on the statements made herein because one or
more sales to the Transferee will be in reliance on Rule 144A.
___ ___ Will the Transferee be purchasing the Notes
Yes No only for the Transferee's own account?
6. If the answer to the foregoing question is "no", then
in each case where the Transferee is purchasing for an account other than its
own, such account belongs to a third party that is itself a "qualified
institutional buyer" within the meaning of Rule 144A, and the "qualified
institutional buyer" status of such third party has been established by the
Transferee through one or more of the appropriate methods contemplated by Rule
144A.
7. The undersigned will notify the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Transferee's purchase of the Notes will constitute a
reaffirmation of this certification by the undersigned as of the date of such
purchase.
Print Name of Transferee or Adviser:
By _________________________________
Name________________________________
Title:______________________________
IF AN ADVISER:
Print Name of Transferee:
____________________________________
B-8
