exv10w1



 



EXHIBIT 10.1


EXECUTION COPY


PURCHASE AGREEMENT



dated as of October 29, 2003



between



VW CREDIT, INC.



and



VOLKSWAGEN PUBLIC AUTO LOAN SECURITIZATION, LLC



Purchase Agreement


 






 




TABLE OF CONTENTS




	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	Page
	ARTICLE I	 	DEFINITIONS AND USAGE
	 	 	1	 
	SECTION 1.1	 	 	Definitions
	 	 	1	 
	SECTION 1.2	 	 	Other Interpretive Provisions
	 	 	1	 
	ARTICLE II	 	PURCHASE
	 	 	2	 
	SECTION 2.1	 	 	Agreement to Sell and Contribute on the Closing Date
	 	 	2	 
	SECTION 2.2	 	 	Consideration and Payment
	 	 	2	 
	ARTICLE III	 	REPRESENTATIONS, WARRANTIES AND COVENANTS
	 	 	2	 
	SECTION 3.1	 	 	Representations and Warranties of VCI
	 	 	2	 
	SECTION 3.2	 	 	Representations and Warranties of VCI as to each Receivable
	 	 	3	 
	SECTION 3.3	 	 	Repurchase upon Breach
	 	 	4	 
	SECTION 3.4	 	 	Protection of Title
	 	 	4	 
	SECTION 3.5	 	 	Other Liens or Interests
	 	 	5	 
	ARTICLE IV	 	MISCELLANEOUS
	 	 	5	 
	SECTION 4.1	 	 	Transfers Intended as Sale; Security Interest
	 	 	5	 
	SECTION 4.2	 	 	Notices, Etc
	 	 	6	 
	SECTION 4.3	 	 	Choice of Law
	 	 	7	 
	SECTION 4.4	 	 	Headings
	 	 	7	 
	SECTION 4.5	 	 	Counterparts
	 	 	7	 
	SECTION 4.6	 	 	Amendment
	 	 	7	 
	SECTION 4.7	 	 	Waivers
	 	 	8	 
	SECTION 4.8	 	 	Entire Agreement
	 	 	8	 
	SECTION 4.9	 	 	Severability of Provisions
	 	 	8	 
	   SECTION 4.10	 	 	Binding Effect; Assignability
	 	 	9	 
	   SECTION 4.11	 	 	Acknowledgment and Agreement
	 	 	9	 
	   SECTION 4.12	 	 	No Waiver; Cumulative Remedies
	 	 	9	 
	   SECTION 4.13	 	 	Nonpetition Covenant
	 	 	9	 
	   SECTION 4.14	 	 	Submission to Jurisdiction
	 	 	9	 




	 	 	 	 	 
	 	 	
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	 	Purchase Agreement



 






 



EXHIBITS




	 	 	 
	Exhibit A	 	
Form of Assignment Pursuant to Purchase Agreement
	 
	Schedule I	 	
Representations and Warranties With Respect to the Receivables





	 	 	 	 	 
	 	 	
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	 	Purchase Agreement




 






 





     THIS PURCHASE AGREEMENT is made and entered into as of October 29, 2003
(as amended from time to time, this “Agreement”) by VW CREDIT, INC., a Delaware
corporation (“VCI”), and VOLKSWAGEN PUBLIC AUTO LOAN SECURITIZATION, LLC, a
Delaware limited liability company (the “Purchaser”).


WITNESSETH:



     WHEREAS, the Purchaser desires to purchase from VCI a portfolio of motor
vehicle receivables, including retail motor vehicle installment sales contracts
and/or installment loans that are secured by new and used automobiles and
light-duty trucks; and


     WHEREAS, VCI is willing to sell such portfolio of motor vehicle
receivables and related property to the Purchaser on the terms and conditions
set forth in this Agreement.


     NOW, THEREFORE, in consideration of the premises and the mutual agreements
set forth herein, the parties hereto agree as follows:


ARTICLE I



DEFINITIONS AND USAGE



     SECTION 1.1 Definitions. Except as otherwise defined herein or as the
context may otherwise require, capitalized terms used but not otherwise defined
herein are defined in Appendix A to the Sale and Servicing Agreement dated as
of the date hereof (as from time to time amended, supplemented or otherwise
modified and in effect, the “Sale and Servicing Agreement”) among Volkswagen
Auto Loan Enhanced Trust 2003-2, VCI, as servicer, the Purchaser, as seller,
and JPMorgan Chase Bank, as indenture trustee, which also contains rules as to
usage that are applicable herein.


     SECTION 1.2 Other Interpretive Provisions. For purposes of this
Agreement, unless the context otherwise requires: (a) accounting terms not
otherwise defined in this Agreement, and accounting terms partly defined in
this Agreement to the extent not defined, shall have the respective meanings
given to them under GAAP; (b) terms defined in Article 9 of the UCC as in
effect in the relevant jurisdiction and not otherwise defined in this Agreement
are used as defined in that Article; (c) the words “hereof,” “herein” and
“hereunder” and words of similar import refer to this Agreement as a whole and
not to any particular provision of this Agreement; (d) references to any
Article, Section, Schedule, Appendix or Exhibit are references to Articles,
Sections, Schedules, Appendices and Exhibits in or to this Agreement and
references to any paragraph, subsection, clause or other subdivision within any
Section or definition refer to such paragraph, subsection, clause or other
subdivision of such Section or definition; (e) the term “including” means
“including without limitation”; (f) except as otherwise expressly provided
herein, references to any law or regulation refer to that law or regulation as
amended from time to time and include any successor law or regulation; (g)
references to any Person include that Person’s successors and assigns; and (h)
headings are for purposes of reference only and shall not otherwise affect the
meaning or interpretation of any provision hereof.




	 	 	 	 	 
	 	 	 

	 	Purchase Agreement





 






 


ARTICLE II



PURCHASE



     SECTION 2.1 Agreement to Sell and Contribute on the Closing Date. On the
terms and subject to the conditions set forth in this Agreement, VCI agrees to
transfer, assign, set over, sell and otherwise convey to the Purchaser without
recourse (subject to the obligations herein) on the Closing Date all of its
right, title and interest in, to and under the Receivables, the Collections
after the Cut-Off Date and the Related Security relating thereto, described in
an Assignment in the form of Exhibit A delivered on the Closing Date (the
“Purchased Assets”) having a Net Pool Balance as of the Cut-Off Date equal to
$1,354,290,044.71, which sale shall be effective as of the Cut-Off Date. The
transfer, assignment and conveyance made hereunder will not constitute and is
not intended to result in an assumption by the Purchaser of any obligation of
the applicable Originator to the Obligors, the Dealers or any other Person in
connection with the Receivables and the other assets and properties conveyed
hereunder or any agreement, document or instrument related thereto.


     SECTION 2.2 Consideration and Payment. In consideration of the transfer
of the Purchased Assets conveyed to the Purchaser on the Closing Date, the
Purchaser shall pay in cash to VCI on such date an amount equal to
$1,252,864,145.87, and VCI elects to contribute to the Purchaser such Purchased
Assets as had an Outstanding Principal Balance equal to $101,425,898.84.


ARTICLE III



REPRESENTATIONS, WARRANTIES AND COVENANTS



     SECTION 3.1 Representations and Warranties of VCI. VCI makes the
following representations and warranties as of the Closing Date on which the
Purchaser will be deemed to have relied in acquiring the Purchased Assets. The
representations and warranties speak as of the execution and delivery of this
Agreement and will survive the conveyance of the Purchased Assets to the
Purchaser, the conveyance of the Purchased Assets to the Issuer pursuant to the
Sale and Servicing Agreement and the Grant thereof by the Issuer to the
Indenture Trustee pursuant to the Indenture:


     (a)  Existence and Power. VCI is a corporation validly existing and in
good standing under the laws of its state of organization and has, in all
material respects, all power and authority required to carry on its business as
now conducted. VCI has obtained all necessary licenses and approvals in each
jurisdiction where the failure to do so would materially and adversely affect
the ability of VCI to perform its obligations under the Transaction Documents
or affect the enforceability or collectibility of the Receivables or any other
part of the Purchased Assets.


     (b)  Authorization and No Contravention. The execution, delivery and
performance by VCI of each Transaction Document to which it is a party (i) have
been duly authorized by all necessary action on the part of VCI and (ii) do not
contravene or constitute a default under (A) any applicable law, rule or
regulation, (B) its organizational documents or (C) any material




	 	 	 	 	 
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agreement, contract, order or other instrument to which it is a party or
its property is subject (other than violations of which do not affect the
legality, validity or enforceability of any of such agreements and which,
individually or in the aggregate, would not materially and adversely affect the
transactions contemplated by, or VCI’s ability to perform its obligations
under, the Transaction Documents).


     (c)  No Consent Required. No approval or authorization by, or filing with,
any Governmental Authority is required in connection with the execution,
delivery and performance by VCI of any Transaction Document other than (i) UCC
filings, (ii) approvals and authorizations that have previously been obtained
and filings that have previously been made and (iii) approvals, authorizations
or filings which, if not obtained or made, would not have a material adverse
effect on the enforceability or collectibility of the Receivables or any other
part of the Purchased Assets or would not materially and adversely affect the
ability of VCI to perform its obligations under the Transaction Documents.


     (d)  Binding Effect. Each Transaction Document to which VCI is a party
constitutes the legal, valid and binding obligation of VCI enforceable against
VCI in accordance with its terms, except as such enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium, receivership,
conservatorship or other similar laws affecting creditors’ rights generally
and, if applicable, the rights of creditors of limited liability companies from
time to time in effect or by general principles of equity.


     (e)  No Proceedings. There are no actions, suits or proceedings pending
or, to the knowledge of VCI, threatened against VCI before or by any
Governmental Authority that (i) assert the invalidity or unenforceability of
this Agreement or any of the other Transaction Documents, (ii) seeking to
prevent the issuance of the Notes or the consummation of any of the
transactions contemplated by this Agreement or any of the other Transaction
Documents, (iii) seeking any determination or ruling that would materially and
adversely affect the performance by VCI of its obligations under this Agreement
or any of the other Transaction Documents, or (iv) relating to VCI that would
materially and adversely affect the federal or Applicable Tax State income,
excise, franchise or similar tax attributes of the Notes.


     (f)  Lien Filings. VCI is not aware of any material judgment, ERISA or tax
lien filings against VCI.


     SECTION 3.2 Representations and Warranties of VCI as to each Receivable.
VCI hereby makes the representations and warranties set forth on Schedule I as
to the Receivables transferred, assigned, set over, sold and otherwise conveyed
to the Purchaser on which such representations and warranties the Purchaser
relies in acquiring the Receivables. Such representations and warranties
speak, with respect to any Receivable, as of the Cut-Off Date, but shall
survive the sale of such Receivables to the Issuer under the Sale and Servicing
Agreement, and the Grant of the Receivables by the Issuer to the Indenture
Trustee pursuant to the Indenture. Notwithstanding any statement to the
contrary contained herein or in any other Transaction Document, VCI shall not
be required to notify any insurer with respect to any Insurance Policy obtained
by an Obligor or to notify any Dealer about any aspect of the transaction
contemplated by the Transaction Documents.




	 	 	 	 	 
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     SECTION 3.3 Repurchase upon Breach. Upon discovery by or notice to the
Purchaser or VCI of a breach of any of the representations and warranties set
forth in Section 3.2 at the time such representations and warranties were made
which materially and adversely affects the interests of the Issuer or the
Noteholders, the party discovering such breach or receiving such notice shall
give prompt written notice thereof to the other party; provided that the
failure to give such notice shall not affect any obligation of VCI hereunder.
If VCI does not correct or cure such breach prior to the end of the Collection
Period which includes the 60th day (or, if VCI elects, an earlier date) after
the date that VCI became aware or was notified of such breach, then VCI shall
purchase any Receivable materially and adversely affected by such breach from
the Purchaser on the Payment Date following the end of such Collection Period.
Any such breach or failure will not be deemed to have a material and adverse
effect if such breach or failure does not affect the ability of the Purchaser
(or its assignee) to receive and retain timely payment in full on such
Receivable. Any such purchase by VCI shall be at a price equal to the
Repurchase Price. In consideration for such repurchase, VCI shall make (or
shall cause to be made) a payment to the Purchaser equal to the Repurchase
Price by depositing such amount into the Collection Account prior to 11:00 am,
New York City time on such Payment Date. Upon payment of such Repurchase Price
by VCI, the Purchaser shall release and shall execute and deliver such
instruments of release, transfer or assignment, in each case without recourse
or representation, as shall be reasonably necessary to vest in VCI or its
designee any Receivable repurchased pursuant hereto. It is understood and
agreed that the obligation of VCI to purchase any Receivable as described above
shall constitute the sole remedy respecting such breach available to the
Purchaser.


     SECTION 3.4 Protection of Title.


     (a)  VCI shall authorize and file such financing statements and cause to be
authorized and filed such continuation and other statements, all in such manner
and in such places as may be required by law fully to preserve, maintain and
protect the interest of the Purchaser under this Agreement in the Receivables.
VCI shall deliver (or cause to be delivered) to the Purchaser file-stamped
copies of, or filing receipts for, any document filed as provided above, as
soon as available following such filing.


     (b)  VCI shall not change its name, identity, corporate structure or
jurisdiction of organization in any manner that would make any financing
statement or continuation statement filed by VCI in accordance with paragraph
(a) above “seriously misleading” within the meaning of Sections 9-506, 9-507 or
9-508 of the UCC, unless it shall have given the Purchaser at least five days’
prior written notice thereof and, to the extent necessary, shall have promptly
filed amendments to previously filed financing statements or continuation
statements described in paragraph (a) above.


     (c)  VCI shall give the Purchaser at least thirty days’ prior written
notice of any change of location of VCI for purposes of Section 9-307 of the
UCC and shall have taken all action prior to making such change (or shall have
made arrangements to take such action substantially simultaneously with such
change, if it is not possible to take such action in advance) reasonably
necessary or advisable in the opinion of the Purchaser to amend all previously
filed financing statements or continuation statements described in paragraph
(a) above.




	 	 	 	 	 
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     (d)  VCI shall maintain (or shall cause its Sub-Servicer to maintain)
accounts and records as to each Receivable accurately and in sufficient detail
to permit (i) the reader thereof to know at any time the status of such
Receivable, including payments and recoveries made and payment owing (and the
nature of each) and (ii) reconciliation between payments or recoveries on (or
with respect to) each Receivable and the amounts from time to time deposited in
the Collection Account in respect of such Receivable.


     (e)  VCI shall maintain (or shall cause its Sub-Servicer to maintain) its
computer systems so that, from time to time after the conveyance under this
Agreement of the Receivables, the master computer records (including any backup
archives) that refer to a Receivable shall indicate clearly the interest of the
Purchaser (or any subsequent assignee of the Purchaser) in such Receivable and
that such Receivable is owned by such Person. Indication of such Person’s
interest in a Receivable shall not be deleted from or modified on such computer
systems until, and only until, the related Receivable shall have been paid in
full or repurchased.


     (f)  If at any time VCI shall propose to sell, grant a security interest in
or otherwise transfer any interest in motor vehicle receivables to any
prospective purchaser, lender or other transferee, VCI shall give to such
prospective purchaser, lender or other transferee computer tapes, records or
printouts (including any restored from backup archives) that, if they shall
refer in any manner whatsoever to any Receivable, shall indicate clearly that
such Receivable has been sold and is owned by the Purchaser (or any subsequent
assignee of the Purchaser).


     SECTION 3.5 Other Liens or Interests. Except for the conveyances and
grants of security interests pursuant to this Agreement and the other
Transaction Documents, VCI shall not sell, pledge, assign or transfer the
Receivables or other property transferred to the Purchaser to any other Person,
or grant, create, incur, assume or suffer to exist any Lien (other than
Permitted Liens) on any interest therein, and VCI shall defend the right, title
and interest of the Purchaser in, to and under such Receivables or other
property transferred to the Purchaser against all claims of third parties
claiming through or under VCI.


ARTICLE IV



MISCELLANEOUS



     SECTION 4.1 Transfers Intended as Sale; Security Interest.


     (a)  Each of the parties hereto expressly intends and agrees that the
transfers contemplated and effected under this Agreement are complete and
absolute sales and transfers rather than pledges or assignments of only a
security interest and shall be given effect as such for all purposes. It is
further the intention of the parties hereto that the Receivables and related
Purchased Assets shall not be part of VCI’s estate in the event of a bankruptcy
or insolvency of VCI. The sales and transfers by VCI of the Receivables and
related Purchased Assets hereunder are and shall be without recourse to, or
representation or warranty (express or implied) by, VCI, except as otherwise
specifically provided herein. The limited rights of recourse specified herein
against VCI are intended to provide a remedy for breach of representations and
warranties relating to the condition of the property sold, rather than to the
collectibility of the Receivables.




	 	 	 	 	 
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     (b)  Notwithstanding the foregoing, in the event that the Receivables and
other Purchased Assets are held to be property of VCI, or if for any reason
this Agreement is held or deemed to create indebtedness or a security interest
in the Receivables and other Purchased Assets, then it is intended that:



		
	 	     (i) This Agreement shall be deemed to be a security agreement within
the meaning of Articles 8 and 9 of the New York Uniform Commercial Code
and the Uniform Commercial Code of any other applicable jurisdiction;
	 
	 	     (ii) The conveyances provided for in Section 2.1 shall be deemed to
be a grant by VCI of, and VCI hereby grants to the Purchaser, a security
interest in all of its right (including the power to convey title
thereto), title and interest, whether now owned or hereafter acquired, in
and to the Receivables and other Purchased Assets, to secure such
indebtedness and the performance of the obligations of VCI hereunder;
	 
	 	     (iii) The possession by the Purchaser or its agent of the Receivable
Files and any other property as constitute instruments, money, negotiable
documents or chattel paper shall be deemed to be “possession by the
secured party” or possession by the purchaser or a person designated by
such purchaser, for purposes of perfecting the security interest pursuant
to the New York Uniform Commercial Code and the Uniform Commercial Code
of any other applicable jurisdiction; and
	 
	 	     (iv) Notifications to persons holding such property, and
acknowledgments, receipts or confirmations from persons holding such
property, shall be deemed to be notifications to, or acknowledgments,
receipts or confirmations from, bailees or agents (as applicable) of the
Purchaser for the purpose of perfecting such security interest under
applicable law.



     SECTION 4.2 Notices, Etc. All demands, notices and communications
hereunder shall be in writing and shall be delivered or mailed by registered or
certified first-class United States mail, postage prepaid, hand delivery,
prepaid courier service, and addressed in each case as follows: (i) if to the
Issuer, c/o The Bank of New York (Delaware), P.O. Box 6873, White Clay Center,
Route 273, Newark, Delaware 19714, Attention: Kris Gullo, with a copy to the
Administrator, at 3800 Hamlin Road, Auburn Hills, Michigan 48326 (telecopier
no. (248) 754-5360), Attention: General Counsel, with a copy to VW Credit,
Inc., at 3800 Hamlin Road, Auburn Hills, Michigan 48326 (telecopier no. (248)
754-5360), Attention: Treasurer, with a copy to the Indenture Trustee, at 4 New
York Plaza, 6th Floor, New York, New York 10004-2477 (telecopier no. (212)
623-5932), Attention: ITS Structured Finance Administration – Volkswagen Auto
Loan Enhanced Trust 2003-2; (ii) if to the Indenture Trustee, at 4 New York
Plaza, 6th Floor, New York, New York 10004-2477 (telecopier no. (212)
623-5932), Attention: ITS Structured Finance Administration – Volkswagen Auto
Loan Enhanced Trust 2003-2; (iii) if to the Purchaser, at 3800 Hamlin Road,
Auburn Hills, Michigan 48326 (telecopier no. (248) 754-5360), Attention:
Treasurer; (iv) if to the Servicer, at 3800 Hamlin Road, Auburn Hills, Michigan
48326 (telecopier no. (248) 754-5360), Attention: Treasurer, with a copy to VW
Credit, Inc., at 3800 Hamlin Road, Auburn Hills, Michigan 48326 (telecopier no.
(248) 754-5360), Attention: Treasurer; (v) if to VCI, at 3800 Hamlin Road,
Auburn Hills, Michigan 48326 (telecopier no. (248) 754-5360), Attention:
Treasurer, with a copy to VW Credit, Inc., at 3800




	 	 	 	 	 
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Hamlin Road, Auburn Hills, Michigan 48326 (telecopier no. (248) 754-5360),
Attention: General Counsel; (vi) if to Moody’s, to Moody’s Investors Service,
Inc., 99 Church Street, New York, New York 10007 (telecopier no. (212)
298-7139), Attention: ABS Monitoring Group; (vii) if to Standard & Poor’s, to
Standard & Poor’s Ratings Services, 55 Water Street, New York, New York 10041
(telecopier no. (212) 438-2664), Attention: Asset Backed Surveillance Group; or
(viii) at such other address as shall be designated by any of the foregoing in
a written notice to the other parties hereto. Any notice required or permitted
to be mailed to a Noteholder shall be given by first class mail, postage
prepaid, at the address of such Noteholder as shown in the Note Register.
Delivery shall occur only upon receipt or reported tender of such communication
by an officer of the recipient entitled to receive such notices located at the
address of such recipient for notices hereunder; provided, however, that any
notice to a Noteholder mailed within the time prescribed in this Agreement
shall be conclusively presumed to have been duly given, whether or not the
Noteholder shall receive such notice.


     SECTION 4.3 Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL, SUBSTANTIVE LAWS OF THE STATE OF NEW
YORK WITHOUT REFERENCE TO THE RULES THEREOF RELATING TO CONFLICTS OF LAW AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.


     SECTION 4.4 Headings. The section headings hereof have been inserted for
convenience only and shall not be construed to affect the meaning, construction
or effect of this Agreement.


     SECTION 4.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all of such counterparts shall together constitute but one and the same
instrument.


     SECTION 4.6 Amendment.


     (a)  Any term or provision of this Agreement may be amended by VCI and the
Purchaser without the consent of the Indenture Trustee, any Noteholder, the
Issuer or the Owner Trustee; provided that such amendment shall not, as
evidenced by an Opinion of Counsel delivered to the Indenture Trustee
materially and adversely affect the interests of the Noteholders.


     (b)  Any term or provision of this Agreement may be amended by VCI and the
Purchaser without the consent of the Indenture Trustee, any Noteholder, the
Issuer, the Owner Trustee or any other Person to add, modify or eliminate any
provisions as may be necessary or advisable in order to enable VCI, the
Purchaser or any of their Affiliates to comply with or obtain more favorable
treatment under any law or regulation or any accounting rule or principle, it
being a condition to any such amendment that the Rating Agency Condition shall
have been satisfied.


     (c)  This Agreement may also be amended from time to time by VCI and the
Purchaser, with the consent of the Holders of Notes evidencing not less than a
majority of the




	 	 	 	 	 
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aggregate principal amount of the Outstanding Notes, voting as a single
class, for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders. It will not be necessary for the consent
of Noteholders to approve the particular form of any proposed amendment or
consent, but it will be sufficient if such consent approves the substance
thereof. The manner of obtaining such consents (and any other consents of
Noteholders provided for in this Agreement) and of evidencing the authorization
of the execution thereof by Noteholders will be subject to such reasonable
requirements as the Indenture Trustee may prescribe, including the
establishment of record dates pursuant to the Note Depository Agreement.


     (d)  Prior to the execution of any such amendment, VCI shall provide
written notification of the substance of such amendment to each Rating Agency;
and promptly after the execution of any such amendment or consent, VCI shall
furnish a copy of such amendment or consent to each Rating Agency and the
Indenture Trustee.


     (e)  Prior to the execution of any amendment to this Agreement, the
Purchaser, the Owner Trustee and the Indenture Trustee shall be entitled to
receive and conclusively rely upon an Opinion of Counsel stating that the
execution of such amendment is authorized or permitted by this Agreement and
that all conditions precedent to the execution and delivery of such amendment
have been satisfied. The Owner Trustee and the Indenture Trustee may, but
shall not be obligated to, enter into any such amendment which adversely
affects the Owner Trustee’s or the Indenture Trustee’s, as applicable, own
rights, duties or immunities under this Agreement.


     SECTION 4.7 Waivers. No failure or delay on the part of the Purchaser,
the Servicer, VCI, the Issuer or the Indenture Trustee in exercising any power
or right hereunder (to the extent such Person has any power or right hereunder)
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on the Purchaser
or VCI in any case shall entitle it to any notice or demand in similar or other
circumstances. No waiver or approval by the Purchaser under this Agreement
shall, except as may otherwise be stated in such waiver or approval, be
applicable to subsequent transactions. No waiver or approval under this
Agreement shall require any similar or dissimilar waiver or approval thereafter
to be granted hereunder.


     SECTION 4.8 Entire Agreement. The Transaction Documents contain a final
and complete integration of all prior expressions by the parties hereto with
respect to the subject matter thereof and shall constitute the entire agreement
among the parties hereto with respect to the subject matter thereof,
superseding all prior oral or written understandings. There are no unwritten
agreements among the parties.


     SECTION 4.9 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement.




	 	 	 	 	 
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     SECTION 4.10 Binding Effect; Assignability. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns. This Agreement shall create and
constitute the continuing obligations of the parties hereto in accordance with
its terms, and shall remain in full force and effect until such time as the
parties hereto shall agree.


     SECTION 4.11 Acknowledgment and Agreement. By execution below, VCI
expressly acknowledges and consents to the sale of the Purchased Assets and the
assignment of all rights and obligations of VCI related thereto by the
Purchaser to the Issuer pursuant to the Sale and Servicing Agreement and the
Grant of a security interest in the Receivables and the other Purchased Assets
by the Issuer to the Indenture Trustee pursuant to the Indenture for the
benefit of the Noteholders. In addition, VCI hereby acknowledges and agrees
that for so long as the Notes are outstanding, the Indenture Trustee will have
the right to exercise all powers, privileges and claims of the Purchaser under
this Agreement.


     SECTION 4.12 No Waiver; Cumulative Remedies. The remedies herein provided
are cumulative and not exclusive of any remedies provided by law.


     SECTION 4.13 Nonpetition Covenant. Each party hereto agrees that, prior
to the date which is one year and one day after payment in full of all
obligations of each Bankruptcy Remote Party in respect of all securities issued
by any Bankruptcy Remote Party (i) such party hereto shall not authorize any
Bankruptcy Remote Party to commence a voluntary winding-up or other voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to such Bankruptcy Remote Party or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect in any jurisdiction
or seeking the appointment of an administrator, a trustee, receiver,
liquidator, custodian or other similar official with respect to such Bankruptcy
Remote Party or any substantial part of its property or to consent to any such
relief or to the appointment of or taking possession by any such official in an
involuntary case or other proceeding commenced against such Bankruptcy Remote
Party, or to make a general assignment for the benefit of its creditors
generally, any party hereto or any other creditor of such Bankruptcy Remote
Party, and (ii) none of the parties hereto shall commence or join with any
other Person in commencing any proceeding against such Bankruptcy Remote Party
under any bankruptcy, reorganization, liquidation or insolvency law or statute
now or hereafter in effect in any jurisdiction. This Section shall survive the
termination of this Agreement.


     SECTION 4.14 Submission to Jurisdiction. Each of the parties hereto
hereby irrevocably and unconditionally:


     (a)  submits for itself and its property in any legal action or proceeding
relating to this Agreement or any documents executed and delivered in
connection herewith, or for recognition and enforcement of any judgment in
respect thereof, to the nonexclusive general jurisdiction of the courts of the
State of New York, the courts of the United States of America for the Southern
District of New York and appellate courts from any thereof;


     (b)  consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of such action or proceeding




	 	 	 	 	 
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	 	Purchase Agreement




 






 


in any such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;


     (c)  agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Person at its
address determined in accordance with Section 4.2; and


     (d)  agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction.


[Remainder of Page Intentionally Left Blank]




	 	 	 	 	 
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	 	Purchase Agreement





 






 





     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first written above.



	 	 	 	 	 
	 	 	VW CREDIT, INC.
	 	 	 	 	 
	 	 	
By:
	 	/s/ Kevin Kelly
	 	 	 	 	

	 	 	
Name:
	 	Kevin Kelly
	 	 	
Title:
	 	President
	 	 	 	 	 
	 	 	
By:
	 	/s/ Allen L. Strang
	 	 	 	 	

	 	 	
Name:
	 	Allen L. Strang
	 	 	
Title:
	 	Secretary
	 	 	 	 	 
	 	 	VOLKSWAGEN PUBLIC AUTO LOAN SECURITIZATION,

LLC
	 	 	 	 	 
	 	 	
By:
	 	/s/ Peter Schupp
	 	 	 	 	

	 	 	
Name:
	 	Peter Schupp
	 	 	
Title:
	 	President
	 	 	 	 	 
	 	 	
By:
	 	/s/ LeSha A. Thorpe
	 	 	 	 	

	 	 	
Name:
	 	LeSha A. Thorpe
	 	 	
Title:
	 	Assistant Treasurer





	 	 	 	 	 
	 	 	S-1

	 	Purchase Agreement




 






 



EXHIBIT A



FORM OF

ASSIGNMENT PURSUANT TO PURCHASE AGREEMENT



     For value received, in accordance with the Purchase Agreement dated as of
October 29, 2003, between VW Credit, Inc., a Delaware corporation (“VCI”), and
Volkswagen Public Auto Loan Securitization, LLC, a Delaware limited liability
company (the “Purchaser”) (the “Agreement”), on the terms and subject to the
conditions set forth in the Agreement, VCI agrees to transfer, assign, set
over, sell and otherwise convey to the Purchaser on the Closing Date, all of
its right, title and interest in, to and under the Receivables set forth on the
schedule of Receivables delivered by VCI to the Purchaser on the date hereof
(such schedule, the “Schedule of Receivables”), and the Collections after the
Cut-Off Date and the Related Security relating thereto, which sale shall be
effective as of the Cut-Off Date.


     The foregoing sale does not constitute and is not intended to result in
any assumption by the Purchaser of any obligation of the undersigned to the
Obligors, insurers or any other Person in connection with the Receivables, any
insurance policies or any agreement or instrument relating to any of them.


     This assignment is made pursuant to and upon the representations,
warranties and agreements on the part of the undersigned contained in the
Agreement and is governed by the Agreement.


     Capitalized terms used herein and not otherwise defined shall have the
meaning assigned to them in the Agreement.


[Remainder of page intentionally left blank]





	 	 	 	 	 
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	 	Purchase Agreement




 






 





     IN WITNESS HEREOF, the undersigned has caused this assignment to be duly
executed as of October 29, 2003.



	 	 	 
	 	 	
VW CREDIT, INC.
	 	 	 
	 	 	
By: 

	 	 	
Name:
	 	 	
Title:
	 	 	 
	 	 	
By:

	 	 	
Name:
	 	 	
Title:





	 	 	 	 	 
	 	 	A-2

	 	Purchase Agreement




 






 



SCHEDULE I


REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE RECEIVABLES



	(a)	 	Characteristics of Receivables. Each Receivable:




	 	(i)	 	has been fully and properly executed by the Obligor thereto;
	 
	 	(ii)	 	has either (A) been originated by a Dealer in the ordinary
course of such Dealer’s business to finance the retail sale by a
Dealer of the related Financed Vehicle and has been purchased by the
applicable Originator in the ordinary course of its respective
business or (B) has been originated or acquired directly by the
applicable Originator in accordance with its customary practices;
	 
	 	(iii)	 	as of the Closing Date is secured by a first priority
validly perfected security interest in the Financed Vehicle in favor
of the applicable Originator, as secured party, or all necessary
actions have been commenced that would result in a first priority
security interest in the Financed Vehicle in favor of the applicable
Originator, as secured party, which security interest, in either
case, is assignable and has been so assigned (x) by VW Bank to VCI,
if such Receivable was originated by VW Bank, (y) by VCI to the
Purchaser and (z) by the Purchaser to the Issuer;
	 
	 	(iv)	 	contains customary and enforceable provisions such that the
rights and remedies of the holder thereof are adequate for
realization against the collateral of the benefits of the security;
	 
	 	(v)	 	provides, at origination, for level monthly payments which
fully amortize the initial Outstanding Principal Balance over the
original term; provided that the amount of the first or last payment
may be different but in no event more than three times the level
monthly payment;
	 
	 	(vi)	 	provides for interest at the Contract Rate specified in the
Schedule of Receivables; and
	 
	 	(vii)	 	was originated in the United States.




	(b)	 	Individual Characteristics. Each Receivable has the following individual
characteristics as of the Cut-Off Date:




	 	(i)	 	each Receivable is secured by a new or used automobile or
light-duty truck;
	 
	 	(ii)	 	each Receivable has a Contract Rate of no less than 0.00% and
not more than 20.00%;





	 	 	 	 	 
	 	 	Schedule I-1

	 	Schedule I to the Purchase Agreement




 






 







	 	(iii)	 	each Receivable had an original term to maturity of not more
than 72 months and not less than 12 months and each Receivable has a
remaining term to maturity, as of the Cut-Off Date, of 2 months or
more;
	 
	 	(iv)	 	each Receivable had an original Outstanding Principal Balance
less than or equal to $125,000;
	 
	 	(v)	 	each Receivable has an Outstanding Principal Balance as of
the Cut-Off Date of greater than or equal to $1,100;
	 
	 	(vi)	 	no Receivable has a scheduled maturity date later than August
20, 2009;
	 
	 	(vii)	 	no Receivable was more than 30 days past due as of the
Cut-Off Date;
	 
	 	(viii)	 	as of the Cut-off Date, no Receivable was noted in the records of
VCI or the Servicer as being the subject of any pending bankruptcy
or insolvency proceeding;
	 
	 	(ix)	 	no Receivable is subject to a force-placed Insurance Policy
on the related Financed Vehicle;
	 
	 	(x)	 	each Receivable is a Simple Interest Receivable;
	 
	 	(xi)	 	each of the Receivables were selected using selection
procedures that were not known or intended by VCI or the Servicer to
be adverse to the Purchaser; and
	 
	 	(xii)	 	the Dealer of the Financed Vehicle has no participation in,
or other right to receive, any proceeds of such Receivable.




	(c)	 	Schedule of Receivables. The information with respect to a Receivable
transferred on the Closing Date set forth in the Schedule of Receivables
was true and correct in all material respects as of the Cut-Off Date.
	 
	(d)	 	Compliance with Law. The Receivable complied at the time it was
originated or made, in all material respects with all requirements of
applicable federal, state and local laws, and regulations thereunder,
including, to the extent applicable, usury laws, the Federal Truth in
Lending Act, the Equal Credit Opportunity Act, the Fair Credit Reporting
Act, the Federal Trade Commission Act, the Fair Debt Collection Practices
Act, the Fair Credit Billing Act, the Magnuson-Moss Warranty Act, Federal
Reserve Board Regulations B and Z, the Soldiers’ and Sailors’ Civil Relief
Act of 1940, state adaptations of the National Consumer Act and of the
Uniform Consumer Credit Code and any other consumer credit, equal
opportunity and disclosure laws applicable to that Receivable.
	 
	(e)	 	Binding Obligation. The Receivable constitutes the legal, valid and
binding payment obligation in writing of the Obligor, enforceable in all
respects by the holder thereof in accordance with its terms, subject, as
to enforcement, to applicable bankruptcy, insolvency, reorganization,
liquidation or other similar laws and equitable principles relating to or
affecting the enforcement of creditors’ rights generally.





	 	 	 	 	 
	 	 	Schedule I-2

	 	Schedule I to the Purchase Agreement




 






 





	(f)	 	Receivable in Force. The Receivable has not been satisfied, subordinated
or rescinded nor has the related Financed Vehicle been released from the
lien granted by the Receivable in whole or in part.
	 
	(g)	 	No Waiver. As of the Cut-Off Date, no provision of a Receivable has been
waived.
	 
	(h)	 	No Default. Except for payment delinquencies continuing for a period of
not more than 30 days as of the Cut-Off Date, the records of the Servicer
did not disclose that any default, breach, violation or event permitting
acceleration under the terms of the Receivable existed as of the Cut-Off
Date or that any continuing condition that with notice or lapse of time,
or both, would constitute a default, breach, violation or event permitting
acceleration under the terms of the Receivable had arisen as of the
Cut-Off Date.
	 
	(i)	 	Insurance. The Receivable requires the Obligor thereunder to insure the
Financed Vehicle under a physical damage insurance policy.
	 
	(j)	 	No Government Obligor. The Obligor on the Receivable is not the United
States of America or any state thereof or any local government, or any
agency, department, political subdivision or instrumentality of the United
States of America or any state thereof or any local government.
	 
	(k)	 	Assignment. No Receivable has been originated in, or is subject to the
laws of, any jurisdiction under which the sale, transfer, assignment,
conveyance or pledge of such Receivable would be unlawful, void, or
voidable. VCI has not entered into any agreement with any Obligor that
prohibits, restricts or conditions the assignment of the related
Receivable.
	 
	(l)	 	Good Title. It is the intention of VCI that the sale, transfer,
assignment and conveyance herein contemplated constitute an absolute sale,
transfer, assignment and conveyance of the Receivables and that the
Receivables not be part of VCI’s estate in the event of the filing of a
bankruptcy petition by or against the Purchaser under any bankruptcy law.
No Receivable has been sold, transferred, assigned, conveyed or pledged to
any Person other than pursuant to the Transaction Documents. As of the
Closing Date, and immediately prior to the sale and transfer herein
contemplated, VCI had good and marketable title to Receivable free and
clear of all Liens, and, immediately upon the sale and transfer thereof,
the Purchaser will have good and marketable title to each Receivable, free
and clear of all Liens (other than Permitted Liens).
	 
	(m)	 	Filings. All filings (including, without limitation, UCC filings)
necessary in any jurisdiction to give the Issuer a first priority, validly
perfected ownership interest in the Receivables (other than the Related
Security with respect thereto), and to give the Indenture Trustee a first
priority perfected security interest therein, will be made within ten days
of the Closing Date.
	 
	(n)	 	Priority. The Receivable is not pledged, assigned, sold, subject to a
security interest, or otherwise conveyed other than pursuant to the
Transaction Documents. VCI has not authorized the filing of and is not
aware of any financing statements against VCI or the





	 	 	 	 	 
	 	 	Schedule I-3

	 	Schedule I to the Purchase Agreement




 






 





	 	 	Purchaser that include a description of collateral covering the
Receivables other than any financing statement relating to security
interests granted under the Transaction Documents or that have been
terminated. The Purchase Agreement creates a valid and continuing
security interest in the Receivable (other than the Related Security with
respect thereto) in favor of the Purchaser which security interest is
prior to all other Liens (other than Permitted Liens) and is enforceable
as such against all other creditors of and purchasers and assignees from
the Purchaser.
	 
	(o)	 	Characterization of Receivables. Each Receivable constitutes either
“tangible chattel paper”, an “account”, a “promissory note” or a “payment
intangible”, each as defined in the UCC.
	 
	(p)	 	One Original. There is only one original executed copy of each
Receivable in existence. The Servicer (or its agent) has possession of
such original. If such original has been marked, then such original does
not have any marks or notations indicating that it has been pledged,
assigned or otherwise conveyed to any Person other than to a party to the
Transaction Documents.
	 
	(q)	 	No Defenses. VCI has no knowledge either of any facts which would give
rise to any right of rescission, set-off, counterclaim or defense, or of
the same being asserted or threatened, with respect to any Receivable.
	 
	(r)	 	No Repossession. As of the Cut-Off Date, no Financed Vehicle shall have
been repossessed.





	 	 	 	 	 
	 	 	Schedule I-4

	 	Schedule I to the Purchase Agreement