exv10w3



 






Exhibit 10.3




EXECUTION COPY




AMENDED AND RESTATED




TRUST SALE AND SERVICING AGREEMENT




AMONG




VW CREDIT, INC.,




as Servicer




VOLKSWAGEN DEALER FINANCE, LLC,




as Transferor




AND




VOLKSWAGEN CREDIT AUTO MASTER OWNER TRUST,




as Trust




DATED AS OF August 11, 2005









 









 











TABLE OF CONTENTS

(continued)




	 	 	 	 	 
	 	 	Page	 
	ARTICLE I DEFINITIONS
	 	 	11	 
	SECTION 1.1 Definitions
	 	 	11	 
	ARTICLE II CONVEYANCE OF RECEIVABLES
	 	 	11	 
	SECTION 2.1 Conveyance of Receivables
	 	 	11	 
	SECTION 2.2 Acceptance by the Owner Trustee
	 	 	13	 
	SECTION 2.3 Representations and Warranties of the Transferor Relating to the Transferor
and the Agreement
	 	 	13	 
	SECTION 2.4 Representations and Warranties of the Transferor Relating to the Receivables
	 	 	15	 
	SECTION 2.5 Addition of Accounts
	 	 	17	 
	SECTION 2.6 Covenants of the Transferor
	 	 	19	 
	SECTION 2.7 Removal of Accounts Without Removal of Receivables
	 	 	20	 
	SECTION 2.8 Removal of Receivables With Accounts
	 	 	22	 
	SECTION 2.9 Transfer of Ineligible Receivables
	 	 	23	 
	ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES
	 	 	23	 
	SECTION 3.1 Acceptance of Appointment and Other Matters Relating to the Servicer
	 	 	23	 
	SECTION 3.2 Servicing Compensation
	 	 	25	 
	SECTION 3.3 Representations, Warranties and Covenants of the Servicer
	 	 	25	 
	SECTION 3.4 Reports and Records
	 	 	27	 
	SECTION 3.5 Annual Servicer’s Certificate
	 	 	29	 
	SECTION 3.6 Annual Independent Public Accountants’ Servicing Report
	 	 	29	 
	SECTION 3.7 Tax Treatment
	 	 	30	 
	SECTION 3.8 Notices to VCI
	 	 	30	 
	SECTION 3.9 Adjustments
	 	 	30	 
	ARTICLE IV ALLOCATION AND APPLICATION OF COLLECTIONS
	 	 	31	 
	SECTION 4.1 Establishment of Accounts
	 	 	31	 
	SECTION 4.2 Allocations and Applications of Collections and Other Funds
	 	 	32	 
	SECTION 4.3 Excess Principal Collections
	 	 	33	 
	SECTION 4.4 Excess Funding Account
	 	 	33	 
	SECTION 4.5 Net Deposits
	 	 	34	 
	SECTION 4.6 Excess Non-Principal Collections
	 	 	34	 






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	 	 	Page	 
	ARTICLE V DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS AND THE RESIDUAL INTERESTHOLDER
	 	 	34	 
	ARTICLE VI OTHER MATTERS RELATING TO THE SERVICER
	 	 	35	 
	SECTION 6.1 Liability of the Servicer
	 	 	35	 
	SECTION 6.2 Merger or Consolidation of, or Assumption of, the Obligations of the Servicer
	 	 	35	 
	SECTION 6.3 Limitation on Liability of the Servicer and Others
	 	 	35	 
	SECTION 6.4 Servicer Indemnification of the Trust, the Indenture Trustee and the Owner
Trustee
	 	 	36	 
	SECTION 6.5 The Servicer Not to Resign
	 	 	37	 
	SECTION 6.6 Access to the Documentation and Information Regarding the Receivables
	 	 	37	 
	SECTION 6.7 Delegation of Duties
	 	 	37	 
	SECTION 6.8 Examination of Records
	 	 	38	 
	ARTICLE VII SERVICING DEFAULTS
	 	 	38	 
	SECTION 7.1 Servicing Defaults
	 	 	38	 
	SECTION 7.2 Indenture Trustee to Act; Appointment of Successor
	 	 	39	 
	SECTION 7.3 Notification to Noteholders and Residual Interestholder
	 	 	41	 
	SECTION 7.4 Waiver of Past Defaults
	 	 	41	 
	ARTICLE VIII MISCELLANEOUS PROVISIONS
	 	 	41	 
	SECTION 8.1 Amendment
	 	 	41	 
	SECTION 8.2 Nonpetition Covenant
	 	 	42	 
	SECTION 8.3 Choice of Law
	 	 	43	 
	SECTION 8.4 Notices
	 	 	43	 
	SECTION 8.5 Severability of Provisions
	 	 	43	 
	SECTION 8.6 Assignment
	 	 	43	 
	SECTION 8.7 Further Assurances
	 	 	43	 
	SECTION 8.8 No Waiver; Cumulative Remedies
	 	 	43	 
	SECTION 8.9 Counterparts
	 	 	44	 
	SECTION 8.10 Third-Party Beneficiaries
	 	 	44	 
	SECTION 8.11 Action by Owner Trustee
	 	 	44	 
	SECTION 8.12 Merger and Integration
	 	 	44	 






ii









 






	 	 	 	 	 
	 	 	Page	 
	SECTION 8.13 Headings
	 	 	44	 
	SECTION 8.14 No Recourse
	 	 	44	 
	SECTION 8.15 Submission to Jurisdiction
	 	 	45	 






EXHIBITS

EXHIBIT A Form of Assignment

EXHIBIT BForm of Annual Servicer’s Certificate

EXHIBIT CForm of Reassignment



SCHEDULES

SCHEDULE 1 List of Accounts

SCHEDULE 2 List of Trust Accounts



iii





 









 







AMENDED AND RESTATED TRUST SALE AND SERVICING AGREEMENT dated as of August 11, 2005, by and among
VW CREDIT, INC., a Delaware corporation (the “Servicer”), VOLKSWAGEN DEALER FINANCE, LLC, a
Delaware limited liability company (the “Transferor”), and VOLKSWAGEN CREDIT AUTO MASTER
OWNER TRUST, a Delaware statutory trust (formerly known as VOLKSWAGEN CREDIT AUTO MASTER OWNER
TRUST, a New York common law trust) (the “Trust”).



WHEREAS, the Servicer, the Transferor and the Trust are parties to that Trust Sale and Servicing
Agreement dated as of August 10, 2000 (the “Existing TSSA”), and whereas the parties to the
Existing TSSA desire to amend the Existing TSSA, and to restate it in its entirety.



In consideration of the mutual agreements herein contained, the Existing TSSA is hereby amended and
restated in its entirety as follows and each party agrees as follows for the benefit of the other
parties and for the benefit of the Residual Interestholder and the Beneficiaries to the extent
provided herein:




ARTICLE I




DEFINITIONS




     SECTION 1.1 Definitions. Certain capitalized terms in this Agreement are defined in
and shall have the respective meanings assigned to them in Part I of Appendix A to
this Agreement. All references herein to “the Agreement” or “this Agreement” are to this Trust
Sale and Servicing Agreement as it may be amended, supplemented or modified from time to time, the
exhibits hereto and the capitalized terms used herein which are defined in Appendix A, and
all references herein to Articles, Sections and subsections are to Articles, Sections or
subsections of this Agreement unless otherwise specified. The rules of construction set forth in
Part II of Appendix A shall be applicable to this Agreement.



ARTICLE II




CONVEYANCE OF RECEIVABLES




     SECTION 2.1 Conveyance of Receivables. In consideration of the Issuer’s delivery to
the Transferor of the Residual Interest, the Transferor does hereby sell, transfer, assign, set
over and otherwise convey, without recourse (except as expressly provided herein), to the Trust for
the benefit of the Residual Interestholder and the other Beneficiaries on the Initial Closing Date,
in the case of the Initial Accounts, and on the applicable Addition Date, in the case of Additional
Accounts, (a) all of its right, title and interest in, to and under the Receivables in each Account
and all Collateral Security with respect thereto owned by the Transferor at the close of business
on the Initial Cut-Off Date, in the case of the Initial Accounts, and on the applicable Additional
Cut-Off Date, in the case of Additional Accounts, and all monies due or to become due thereon
(including all interest accruing thereon after the Initial Cut-Off Date, whether paid or payable)
and all amounts received with respect thereto and all proceeds of all of the foregoing (including
“proceeds” as defined in Section 9-102 of the UCC), and Recoveries thereof and (b) all of
the Transferor’s rights, remedies, powers and privileges with respect to such Receivables (and
otherwise) under the Receivables Purchase Agreement. As of each Business Day, prior to the



Amended and Restated

Trust Sale and Servicing Agreement




 









 




earlier of (i) the occurrence of an Early Amortization Event specified in Section
5.17(a), (b), (c), (d) or (e) of the Indenture or the Series
Supplement and (ii) the Trust Termination Date, on which Receivables are created in the Accounts (a
“Transfer Date”), the Transferor does hereby sell, transfer, assign, set over and otherwise
convey, without recourse (except as expressly provided herein), to the Trust for the benefit of the
Residual Interestholder and the Beneficiaries, all of its right, title and interest in, to and
under the Receivables in each Account (other than any Receivables created in any Designated
Accounts from and after the applicable Removal Date) and all Collateral Security with respect
thereto owned by the Transferor at the close of business on such Transfer Date and not theretofore
conveyed to the Trust, all monies due or to become due and all amounts received with respect
thereto and all proceeds (including “proceeds” as defined in Section 9-102 of the UCC) of all of
the foregoing (all such assets conveyed pursuant to this Agreement, the “Conveyed
Receivables”). Such property, together with all monies on deposit in, and Eligible Investments
credited to, the Collection Account or any Series Account, any Enhancements and the Collateral
Security with respect to the Receivables shall collectively constitute the assets of the Trust (the
“Trust Assets”). The foregoing sale, transfer, assignment, set-over and conveyance and any
subsequent sales, transfers, assignments, set-overs and conveyances do not constitute, and are not
intended to result in, the creation or an assumption by the Trust, the Owner Trustee, the Indenture
Trustee, any Agent or any Beneficiary of any obligation of the Servicer, the Transferor, VCI or any
other Person in connection with the Accounts, the Receivables or under any agreement or instrument
relating thereto, including any obligation to any Dealers.




     It is the express intent of the parties hereto that the conveyance of the Conveyed Receivables
by Transferor be, and be construed as, sales of such Conveyed Receivables by Transferor to the
Trust, and not a pledge by Transferor to the Trust to secure a debt or other obligations of
Transferor. However, in the event that, notwithstanding the aforementioned intent of the parties,
any such Conveyed Receivables are held to be the property of Transferor, then it is the express
intent of the parties to this Agreement that this Agreement constitutes a “security agreement”
under the UCC and applicable law, and Transferor hereby grants to the Trust a first priority,
continuing lien and security interest in all right, title and interest of Transferor in, to and
under the Conveyed Receivables sold pursuant to this Agreement, and all proceeds in respect
thereof. Transferor shall take such actions, as may be necessary to ensure that if this Agreement
were deemed to create a security interest, such security interest would be a perfected security
interest of first priority under applicable law and will be maintained as such for the term of this
Agreement.



     In connection with such sales, the Transferor agrees to record and file, at its own expense, a
financing statement on form UCC-1 or any other applicable form (and continuation statements when
applicable) with respect to the Receivables now existing and hereafter created for the sale of
chattel paper, accounts, payment intangibles and general intangibles (as defined in
Sections 9-102 of the UCC as in effect in the applicable jurisdiction where either the
Transferor or VCI is “located” for purposes of Section 9-307 of the UCC), meeting the
requirements of applicable law in such manner and in such jurisdictions as are necessary to perfect
the sale and assignment of the Receivables and the Collateral Security to the Trust, and to deliver
a file-stamped copy of such financing statements or other evidence of such filing to the Owner
Trustee on or prior to the Initial Closing Date, in the case of the Initial Accounts, and (if any
additional filing is so necessary) the applicable Addition Date, in the case of Additional
Accounts. The Owner Trustee



5









 




shall be under no obligation whatsoever to file such financing statement, or a continuation
statement to such financing statement, or to make any other filing under the UCC in connection with
such sales.




     In connection with such sales, the Transferor further agrees, at its own expense, on or prior
to the Initial Closing Date, in the case of the Initial Accounts, the applicable Addition Date, in
the case of Additional Accounts, and the applicable Removal Date, in the case of Removed Accounts,
(a) to cause the Servicer to indicate in its computer files as required by the Receivables Purchase
Agreement, that the Receivables created in connection with the Accounts (other than Removed
Accounts) have been sold, and the Collateral Security assigned, to the Transferor in accordance
with the Receivables Purchase Agreement and sold to the Trust pursuant to this Agreement for the
benefit of the Residual Interestholder and the Beneficiaries and (b) to deliver to the Owner
Trustee and the Indenture Trustee (or cause VCI to do so) a computer file or microfiche or written
list (which may be in electronic form) containing a true and complete list of all such Accounts
(other than Removed Accounts) specifying for each such Account, as of the Initial Cut-Off Date, in
the case of the Initial Accounts, and the applicable Additional Cut-Off Date, in the case of
Additional Accounts, (i) its account number and (ii) the aggregate amount of Principal Receivables
in such Account. Such file or list, as supplemented from time to time to reflect Additional
Accounts and Removed Accounts, shall be marked as Schedule 1 to this Agreement and is
hereby incorporated into and made a part of this Agreement. Neither the Owner Trustee nor the
Indenture Trustee shall be under any obligation whatsoever to verify the accuracy or completeness
of the information contained in Schedule 1 from time to time. By their execution hereof,
the Owner Trustee and the Indenture Trustee acknowledge receipt of the initial computer file or
microfiche or written list (which may be in electronic form) with respect to the Initial Accounts.



     By executing this Agreement, the parties hereto do not intend to cancel, release or in any way
impair the conveyances previously made under the Existing TSSA.



     SECTION 2.2 Acceptance by the Owner Trustee. The Trust hereby acknowledges its
acceptance of all right, title and interest previously held by the Transferor to the property, now
existing and hereafter created, conveyed to the Trust pursuant to Section 2.1 and declares
that it shall maintain such right, title and interest, upon the trust herein set forth, for the
benefit of the Residual Interestholder and the Beneficiaries. The Trust further acknowledges that,
prior to or simultaneously with the execution and delivery of this Agreement, the Transferor
delivered to the Owner Trustee the computer file or microfiche or written list (which may be in
electronic form) relating to the Initial Accounts described in the penultimate paragraph of
Section 2.1.



     The Owner Trustee shall have no power to create, assume or incur indebtedness or other
liabilities in the name of the Trust other than as contemplated in the Basic Documents.



     SECTION 2.3 Representations and Warranties of the Transferor Relating to the Transferor
and the Agreement. The Transferor hereby represents and warrants to the Trust, the Indenture
Trustee and to the Owner Trustee as of each Closing Date and each Addition Date that:



     (a) Existence and Power. The Transferor is a limited liability company validly
existing and in good standing under the laws of its state of organization and has all power and



6









 




authority required to carry on its business as it is now conducted. The Transferor has
obtained all necessary licenses and approvals in all jurisdictions where the failure to do so would
materially and adversely affect the business, properties, financial condition or results of
operations of the Transferor taken as a whole.




     (b) Company Authorization and No Contravention. The execution, delivery and
performance by the Transferor of each Basic Document to which it is a party (i) have been duly
authorized by all necessary limited liability company action and (ii) do not contravene or
constitute a default under (A) any applicable law, rule or regulation, (B) its organizational
documents or (C) any agreement, contract, order or other instrument to which it is a party or its
property is subject.



     (c) Litigation. There are no actions, suits or proceedings pending or, to the
knowledge of the Transferor, threatened against the Transferor before or by any Governmental
Authority that (i) question the validity or enforceability of this Agreement or adversely affect
the ability of the Transferor to perform its obligations hereunder or (ii) individually or in the
aggregate would have a material adverse effect. The Transferor is not in default with respect to
any orders of any Governmental Authority, the default under which individually or in the aggregate
would have a material adverse effect.



     (d) No Consent Required. No approval, authorization or other action by, or filing
with, any Governmental Authority is required in connection with the execution, delivery and
performance by the Transferor of any Basic Document other than UCC filings and other than approvals
and authorizations that have previously been obtained and filings which have previously been made.



     (e) Binding Effect. Each Basic Document to which the Transferor is a party
constitutes the legal, valid and binding obligation of the Transferor enforceable against the
Transferor in accordance with its terms, except as limited by bankruptcy, insolvency, or other
similar laws of general application relating to or affecting the enforcement of creditors’ rights
generally and subject to general principles of equity.



     (f) Record of Accounts. As of the Initial Closing Date, in the case of the Initial
Accounts, as of the applicable Addition Date, in the case of the Additional Accounts, and, as of
the applicable Removal Date, in the case of Removed Accounts, Schedule 1 to this Agreement
is an accurate and complete listing in all material respects of all the Accounts as of the Initial
Cut-Off Date, the applicable Additional Cut-Off Date or the applicable Removal Date, as the case
may be, and the information contained therein with respect to the identity of such Accounts and the
Receivables existing thereunder is true and correct in all material respects as of the Initial
Cut-Off Date, such applicable Additional Cut-Off Date or such Removal Date, as the case may be.



     (g) Valid Transfer. This Agreement or, in the case of Additional Accounts, the
related Assignment, constitutes a valid sale, transfer and assignment to the Trust of all right,
title and interest of the Transferor in the related Receivables and the Collateral Security and the
proceeds thereof and all of the Transferor’s rights, remedies, powers and privileges with respect
to the Receivables under the Receivables Purchase Agreement and, upon the filing of the



7









 




financing statements described in Section 2.1 with the Secretary of State in the
applicable jurisdiction where either the Transferor or VCI is “located” for purposes of
Section 9-301 of the UCC and, in the case of the Additional Receivables hereafter created
and the proceeds thereof, upon the creation thereof, the Trust shall have a first priority
perfected ownership interest in such property, except for Liens permitted under Section
2.6(a). Except as otherwise provided in this Agreement, or the other Basic Documents, neither
the Transferor nor any Person claiming through or under the Transferor has any claim to or interest
in the Trust Assets.




     The representations and warranties set forth in this Section 2.3 shall survive the
transfer and assignment of the Receivables to the Trust. Upon discovery by the Transferor, the
Owner Trustee, the Indenture Trustee, the Servicer, or any Agent of a breach of any of the
foregoing representations and warranties, the party discovering such breach shall give prompt
written notice to the other parties, any Agent and to any Enhancement Providers.



     In the event the Noteholders shall have exercised their right to have the Notes redeemed
pursuant to Section 10.1(b) of the Indenture as a result of any breach of any of the
representations and warranties set forth in this Section 2.3, the Transferor shall deposit
into the Note Distribution Account in immediately available funds on the Business Day preceding the
Redemption Date, an amount equal to the sum of the amounts specified therefor with respect to each
outstanding Series in the related Series Supplement. The obligation of the Transferor to make the
deposit specified in this Section 2.3 will constitute the sole remedy to the Trust, the
Noteholders (the Indenture Trustee on behalf of the Noteholders) or any other Person as a result of
the breach of the representations and warranties set forth in this Section 2.3.



     SECTION 2.4 Representations and Warranties of the Transferor Relating to the
Receivables.



     (a) Representations and Warranties. The Transferor represents and warrants to the
Trust that:




     (i) Each Receivable and all Collateral Security existing on the Initial Closing Date
or, in the case of Additional Accounts, on the applicable Addition Date, and on each
Transfer Date, and all of the Transferor’s right title and interest in the Receivables
Purchase Agreement, has been conveyed to the Trust free and clear of any Lien (other than
the Lien held by VCI subject to Article VII of the Receivables Purchase Agreement).




     (ii) With respect to each Receivable and all Collateral Security existing on the
Initial Closing Date or, in the case of Additional Accounts, on the applicable Addition
Date, and on each Transfer Date, all consents, licenses, approvals or authorizations of or
registrations or declarations with any Governmental Authority required to be obtained,
effected or given by the Transferor in connection with the conveyance of such Receivable or
Collateral Security to the Trust have been duly obtained, effected or given and are in full
force and effect.



8









 






     (iii) For each Initial Account and each Additional Account, as of the Initial Cut-Off
Date and applicable Additional Cut-Off Date respectively, such Initial Account or Additional
Account is an Eligible Account.




     (iv) On the Initial Closing Date, in the case of the Initial Accounts, and, in the case
of the Additional Accounts, on the applicable Addition Date, and on each Transfer Date, each
Receivable conveyed to the Trust on such date is an Eligible Receivable or, if such
Receivable is not an Eligible Receivable, such Receivable is conveyed to the Trust in
accordance with Section 2.9.




     (v) In the selection of Accounts, no selection procedures reasonably believed by the
Transferor to be adverse to the interests of the Noteholders shall have been used in
selecting such Accounts



     (b) Notice of Breach. The representations and warranties set forth in Section
2.4(a) shall survive the transfer and assignment of the Receivables to the Trust and the pledge
to the Indenture Trustee under the Indenture. Upon discovery by the Transferor, the Owner Trustee,
the Indenture Trustee, the Servicer, or any Agent, of a breach of any of the representations and
warranties set forth in Section 2.4(a) the party discovering such breach shall give prompt
written notice to the other parties and to any Enhancement Providers.



     (c) Reassignment. In the event any representation or warranty under Section
2.4(a) is not true and correct as of the date specified therein with respect to any Receivable
or Account and such breach has a material adverse effect on the Noteholders, then, within 30 days
(or such longer period as may be agreed to in writing by the Indenture Trustee) of the earlier to
occur of the discovery of any such event by the Transferor or the Servicer, or receipt by the
Transferor or the Servicer of written notice of any such event given by the Owner Trustee, the
Indenture Trustee, any Agent or any Enhancement Providers, the Transferor shall accept a
reassignment of such Receivable or, in the case of such an untrue representation or warranty with
respect to an Account, all Receivables in such Account, on the Determination Date immediately
succeeding the day of such discovery or notice on the terms and conditions set forth in the next
succeeding paragraph; provided, however, that no such reassignment shall be
required to be made with respect to such Receivable if, by the end of such 30-day period (or such
longer period as may be agreed to in writing by the Indenture Trustee), the breached representation
or warranty shall then be true and correct in all material respects and any material adverse effect
caused thereby shall have been cured.



     The Transferor shall accept a reassignment of each such Receivable by directing the Servicer
to deduct, subject to the next sentence, the principal amount of such Receivables from the Pool
Balance on or prior to the end of the Collection Period in which such reassignment obligation
arises. If, following such deduction, the Residual Participation Amount would be less than the
Trust Available Subordination Amount on the immediately preceding Determination Date (after giving
effect to the allocations, distributions, withdrawals and deposits to be made on the Payment Date
following such Determination Date), then not later than 12:00 noon on the day on which such
reassignment occurs, the Transferor shall deposit in the Collection Account in immediately
available funds the amount (the “Transfer Deposit Amount”) by which Residual Participation
Amount would be less than such Trust Available Subordination Amount; provided



9









 




that if the Transfer Deposit Amount is not deposited as required by this sentence, then the
principal amounts of the related Receivables shall only be deducted from the Pool Balance to the
extent that the Residual Participation Amount is not reduced below the Trust Available
Subordination Amount and the Receivables the principal amounts of which have not been so deducted
shall not be reassigned to the Transferor and shall remain part of the Trust. Upon reassignment of
any such Receivable, but only after payment by the Transferor of the Transfer Deposit Amount, if
any, the Trust shall automatically and without further action be deemed to sell, transfer, assign,
set over and otherwise convey to the Transferor, without recourse, representation or warranty, all
the right, title and interest of the Trust in and to such Receivable, all Collateral Security and
all moneys due or to become due with respect thereto and all proceeds thereof. The Trust shall
execute such documents and instruments of transfer or assignment and take such other actions as
shall reasonably be requested by the Transferor to effect the conveyance of such Receivables
pursuant to this Section 2.4. The obligation of the Transferor to accept a reassignment of
any such Receivable and to pay any related Transfer Deposit Amount shall constitute the sole remedy
respecting the event giving rise to such obligation available to the Trust, the Noteholders (or the
Indenture Trustee on behalf of Noteholders) or any other Person.




     (d) Perfection Representations. The representations, warranties and covenants set
forth on Schedule 3 hereto shall be a part of this Agreement for all purposes.
Notwithstanding any other provision of this Agreement or any other Basic Document, the perfection
representations contained in Schedule 3 shall be continuing, and remain in full force and
effect until such time as all obligations under the Indenture have been finally and fully paid and
performed. The parties to this Agreement: (i) shall not waive any of the perfection
representations contained in Schedule 3; (ii) shall provide the Rating Agencies with prompt
written notice of any breach of perfection representations contained in Schedule 3 and
(iii) shall not waive a breach of any of the perfection representations contained in Schedule
3.



     SECTION 2.5 Addition of Accounts. Subject to the condition set forth in this
Section 2.5, the Transferor may designate additional accounts to be included as Accounts
(the “Additional Accounts”).



     (a) Required Addition of Accounts. If, as of the close of business on the last day of
any Collection Period, the Pool Balance on such day is less than the Required Participation Amount
as of the following Payment Date (after giving effect to the allocations, distributions,
withdrawals and deposits to be made on such Payment Date), then the Transferor shall, within 10
Business Days following the end of such Collection Period, designate and transfer to the Trust the
Receivables (and the Collateral Security) of Additional Accounts of the Transferor to be included
as Accounts designated to the Trust in a sufficient amount such that after giving effect to such
addition, the Pool Balance as of the close of business on the Addition Date is at least equal to
such Required Participation Amount. The failure of the Transferor to transfer Receivables to the
Trust as provided in this paragraph solely as a result of the unavailability of a sufficient amount
of Eligible Receivables shall not constitute a breach of this Agreement; provided,
however, that any such failure will nevertheless result in the occurrence of an Early
Amortization Event described in Section 5.17 of the Indenture. In connection with the
designation of any account as an Additional Account pursuant to this Section 2.5(a), each
of the



10









 




following conditions shall be satisfied with respect to such addition on or prior to the
related Addition Date:





     (i) such Additional Accounts shall all be Eligible Accounts;




     (ii) the Transferor shall have delivered to the Trust a duly executed written
assignment (including an acceptance by the Trust) in substantially the form of Exhibit
A (the “Assignment”) and to the Trust and the Indenture Trustee the computer
file or microfiche or written list (which may be in electronic form) required to be
delivered pursuant to Section 2.1;




     (iii) the Transferor shall, to the extent required by Section 4.2, have
deposited in the Collection Account all Collections with respect to such Additional Accounts
since the Additional Cut-Off Date;




     (iv) (A) no selection procedures reasonably believed by the Transferor to be adverse to
the interests of the Beneficiaries shall have been used in selecting such Additional
Accounts; (B) the list of Additional Accounts delivered pursuant to clause (iii)
shall be true and correct in all material respects as of the Additional Cut-Off Date and (C)
as of each of the Notice Date and the Addition Date, neither VCI nor the Transferor shall be
insolvent nor will either of them be made insolvent by such transfer nor shall any of them
be aware of any pending insolvency;




     (v) the addition of the Receivables arising in such Additional Accounts shall not
result in the occurrence of an Early Amortization Event; and




     (vi) the Transferor shall have delivered to the Owner Trustee, the Indenture Trustee,
the Rating Agencies, and any Enhancement Providers a certificate confirming (A) the items
set forth in paragraphs (ii) through (v) above and (B) that the Transferor reasonably
believes that the addition of the Receivables arising in such Additional Accounts will not
result in the occurrence of an Early Amortization Event.



     Receivables and Collateral Security from such Additional Accounts shall be sold to the Trust
effective on a date (the “Addition Date”) specified in a written notice provided by the
Transferor (or the Servicer on its behalf) to the Owner Trustee, the Indenture Trustee, the Rating
Agencies, any Agent and any Enhancement Providers specifying the Additional Cut-Off Date and the
Addition Date for such Additional Accounts (the “Addition Notice”) on or before the first
Business Day but not more than the 30th day prior to the related Addition Date (the “Notice
Date”).



     The Transferor hereby represents and warrants as of the applicable Addition Date as to the
matters set forth in clause (v) above. Upon discovery by the Transferor, VCI, any Agent,
the Owner Trustee, the Indenture Trustee or any Enhancement Providers of a breach of the foregoing
representations and warranties, the party discovering the breach shall give prompt written notice
to the other parties, to any Agent and to any Enhancement Providers.



     (b) Optional Addition of Accounts. The Transferor may from time to time, at its sole
discretion, voluntarily designate Additional Accounts to be included as Accounts and transfer to



11









 




the Trust the Receivables (and the Collateral Security) of such Additional Accounts.
(Additional Accounts designated in accordance with the provisions described in this Section
2.5(b) are referred to as “Automatic Additional Accounts”.) Except for the designation
of Automatic Additional Accounts to occur on the Closing Date, unless the Rating Agency Condition
is satisfied, (i) the number of, or the aggregate principal balance of Receivables in, Automatic
Additional Accounts designated with respect to any calendar quarter shall not exceed 10% of the
number of, or the aggregate principal balance of Receivables in, Accounts as of the later of August
11, 2005 (after giving effect to any designations of Automatic Additional Accounts on such date)
and the first day of such calendar quarter, and (ii) the number of, or the aggregate principal
balance of Receivables in, Automatic Additional Accounts designated during any calendar year shall
not exceed 20% of the number of, or the aggregate principal balance of Receivables in, Accounts as
of the later of August 11, 2005 (after giving effect to any designations of Automatic Additional
Accounts on such date) and the first day of such calendar year. In addition, in order to
voluntarily designate Automatic Additional Accounts to the Trust, the Transferor shall have
provided the Trust, the Indenture Trustee, any Agent, the Rating Agencies and any Enhancement
Providers with a timely Addition Notice. In connection with the designation of any account as an
Automatic Additional Account pursuant to this Section 2.5(b), each of the conditions
specified in clauses (i), (ii), (iii), (iv) and (v) of Section 2.5(a) shall be satisfied
with respect to such addition on or prior to the related Addition Date. Within 30 days after the
end of any calendar quarter, or such other period as shall be required by the Rating Agencies, in
which Accounts are designated as Automatic Additional Accounts, the Transferor shall deliver to the
Owner Trustee and the Indenture Trustee and each Rating Agency an Opinion of Counsel with respect
to the Automatic Additional Accounts included as Accounts in such quarter, if applicable,
confirming the validity and perfection of the transfer of Receivables in such Automatic Additional
Accounts. If such Opinion of Counsel with respect to any Automatic Additional Accounts is not so
delivered, the ability of the Transferor to designate Receivables in such Automatic Additional
Accounts shall be suspended until such time as the Rating Agency Condition is satisfied with
respect to the designation of additional Automatic Additional Accounts. If the Transferor is
unable to deliver an Opinion of Counsel with respect to any Automatic Additional Account, such
inability shall be deemed to be a breach of the representation and warranty with respect to the
Receivables in such Automatic Additional Account, provided that the cure period for such breach
will not exceed 30 days.




     SECTION 2.6 Covenants of the Transferor. The Transferor hereby covenants that:



     (a) No Liens. Except for the conveyances hereunder or as provided in Section
2.1 of the Indenture, the Transferor will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any Lien on, any Receivable or any
Collateral Security, whether now existing or hereafter created, or any interest therein, or the
Transferor’s rights, remedies, powers or privileges with respect to the Receivables under the
Receivables Purchase Agreement (other than the Lien held by VCI subject to Article VII of
the Receivables Purchase Agreement), and the Transferor shall defend the right, title and interest
of the Trust in, to and under the Receivables and the Collateral Security, whether now existing or
hereafter created, and such rights, remedies, powers and privileges, against all claims of third
parties claiming through or under the Transferor.



12









 





     (b) Delivery of Collections. In the event that the Transferor, VCI or any Affiliate
thereof receives payments in respect of Receivables, the Transferor and VCI agree to pay or cause
to be paid to the Servicer or any Successor Servicer all payments received thereby in respect of
the Receivables as soon as practicable after receipt thereof, but in no event later than two
Business Days after the receipt by the Transferor, VCI or any Affiliate thereof.



     (c) Agreement Matters. If VCI breaches any of the covenants in Section 2.5 of
the Receivables Purchase Agreement and such breach has a material adverse effect on the interests
of the Noteholders and the Residual Interestholder, the Transferor shall enforce its rights under
the Receivables Purchase Agreement arising from such breach.



     (d) Account Allocations. In the event that the Transferor is unable for any reason to
transfer Receivables to the Trust, then the Transferor agrees that it shall allocate, after the
occurrence of such event, payments on each Account with respect to the principal balance of such
Account first to the oldest principal balance of such Account and to have such payments applied as
Collections in accordance with the terms of this Agreement. The parties hereto agree that
Non-Principal Receivables, whenever created, accrued in respect of Principal Receivables which have
been conveyed to the Trust shall continue to be a part of the Trust notwithstanding any cessation
of the transfer of additional Principal Receivables to the Trust and Collections with respect
thereto shall continue to be allocated and paid in accordance with Section 8.2 of the
Indenture.



     (e) Upon any consolidation or merger of the Transferor, the person formed by or surviving such
consolidation or merger (if other the Transferor) shall expressly assume in writing the performance
or observance of every agreement and covenant on the part of the Transferor under the Basic
Documents. The Transferor shall provide copies of such assumption agreement to the Rating Agencies.



     SECTION 2.7 Removal of Accounts Without Removal of Receivables.



     (a) On each Determination Date the Transferor shall have the right to remove Accounts from
being designated to the Trust (without removing the Receivables then existing that relate to such
Accounts) in the manner prescribed in Section 2.7(b).



     (b) To remove Accounts from designation to the Trust, the Transferor (or the Servicer on its
behalf) shall take the following actions and make the following determinations:




     (i) not less than five Business Days prior to the Removal Commencement Date, furnish to
the Trust, the Indenture Trustee, any Agent, any Enhancement Providers and the Rating
Agencies a written notice (the “Removal Notice”) specifying the Determination Date
(which may be the Determination Date on which such notice is given) on which removal of one
or more Accounts will commence (a “Removal Commencement Date”) and specifying the
Accounts the future generated Receivables of which are not to be transferred to the Trust
(the “Designated Accounts”);




     (ii) determine on the Removal Commencement Date the aggregate principal balance of
Receivables in respect of each such Designated Account (the “Designated Balance”)
and deliver to the Trust and the Indenture Trustee a computer file or



13









 





microfiche or written list (which may be in electronic form) of the Designated Accounts
specifying for each Designated Account its account number and the aggregate amount of
Receivables outstanding in the Designated Account;




     (iii) from and after such Removal Commencement Date, cease to transfer to the Trust any
and all Receivables arising in such Designated Accounts;




     (iv) from and after such Removal Commencement Date, allocate all Principal Collections
in respect of each such Designated Account, first to the oldest outstanding principal
balance of such Designated Account, until the Determination Date on which the Designated
Balance with respect to such Designated Account is reduced to zero (the “Removal
Date”);




     (v) on each Business Day from and after such Removal Commencement Date to and until the
related Removal Date, allocate (A) to the Trust (to be further allocated pursuant to the
terms of this Agreement), Non-Principal Collections in respect of each Designated Account
for Receivables in all Designated Accounts transferred to the Trust and (B) to the
Transferor the remainder of the Non-Principal Collections in the Designated Accounts;




     (vi) represent and warrant that the removal of any Eligible Account on the Removal Date
shall not, in the reasonable belief of the Transferor, result in the occurrence of an Early
Amortization Event for any Series or class of Notes;




     (vii) represent and warrant that no selection procedures reasonably believed by the
Transferor to be materially adverse to the interests of the Noteholders or any Enhancement
Provider were utilized in selecting the Designated Accounts; and




     (viii) on or before the related Removal Commencement Date, deliver to the Trust, the
Indenture Trustee, any Agent and any Enhancement Providers an Officers’ Certificate
confirming the items set forth in clauses (vi) through (vii) above and confirming that the
Transferor reasonably believes that the removal of the Removed Accounts will not result in
the occurrence of an Early Amortization Event; the Owner Trustee and the Indenture Trustee
may conclusively rely on such Officers’ Certificate and shall have no duty to make inquiries
with regard to the matters set forth therein and shall incur no liability in so relying.



     No Designated Accounts held by the Trust shall be so removed if such removal will result in a
reduction or withdrawal of the rating of any outstanding Series or class of Notes by any applicable
Rating Agency.



     Upon satisfaction of the above conditions, on the Removal Date with respect to any such Trust
Account, the Transferor shall cease to allocate any Collections therefrom in accordance with this
Section and such Designated Account shall be deemed removed from designation to the Trust for all
purposes (a “Removed Account”). Within five Business Days after the Removal Date, the
Trust shall deliver to the Transferor a reassignment substantially in the form of Exhibit C
(the “Reassignment”), together with any appropriate UCC releases or termination statements.



14









 





     SECTION 2.8 Removal of Receivables With Accounts.



     (a) If, during any Collection Period an Account becomes an Out of Trust Account and if as of
the close of business on the last day of such Collection Period (such last day shall be deemed to
be the Removal Commencement Date), the Pool Balance is greater than the Required Participation
Amount as of the following Payment Date (after giving effect to the allocations, distributions,
withdrawals and deposits to be made on such Payment Date), such Out of Trust Accounts shall
automatically be removed by the Transferor from designation to the Trust and existing Receivables
in such Out of Trust Accounts shall automatically be reassigned to the Transferor without any
consideration therefor in the manner prescribed in Section 2.8(c).



     (b) If, as of the close of business as of the last day of any Collection Period, the Pool
Balance is greater than the Required Participation Amount as of the following Payment Date (after
giving effect to the allocations, distributions, withdrawals and deposits to be made on such
Payment Date), then the Transferor may remove Accounts from designation to the Trust by selecting
Accounts in a manner that the Transferor reasonably believes is not materially adverse to the
interests of the Noteholders and the then existing Receivables in such Accounts shall be reassigned
to the Transferor (“Removed Accounts and Receivables”), without any consideration therefor
in the manner prescribed in Section 2.8(c), to the extent such that, after giving effect to
the removal of such Accounts from designation to the Trust and the reassignment of the Receivables
existing in such Accounts, the Pool Balance as of the related Removal and Reassignment Date exceeds
the Required Participation Amount; provided, however, no more than one such removal
of Accounts from designation to the Trust pursuant to this Section 2.8(b) may occur during
any calendar month.



     (c) To remove Accounts from designation to the Trust and reassign the then existing
Receivables in such Accounts, the Transferor (or the Servicer on its behalf) shall take the
following actions and make the following determinations:




     (i) on or before the fifth Business Day immediately preceding the Removal and
Reassignment Date furnish to the Trust, the Indenture Trustee, any Agent, any Enhancement
Providers and the Rating Agencies a Removal Notice specifying the Removed Accounts and
Receivables which are to be removed and the then existing Receivables in such Accounts which
are to be reassigned from the Trust to the Transferor and the Determination Date on which
such removal of Removed Accounts and Receivables and reassignment of such Receivables is to
occur (the “Removal and Reassignment Date”); provided, however, that
the Removal and Reassignment Date to occur on the Closing Date shall not be required to be a
Determination Date;




     (ii) on or prior to the date that is five Business Days after the Removal and
Reassignment Date, the Transferor shall deliver to the Trust and the Indenture Trustee a
computer file or microfiche or written list (which may be in electronic form) containing a
true and complete list of the Removed Accounts and Receivables specifying for each such
Account, as of the Removal and Reassignment Date, its account number and the aggregate
amount of Receivables outstanding in such Account;



15









 






     (iii) represent and warrant that the list of Removed Accounts and Receivables delivered
pursuant to clause (ii), as of the Removal and Reassignment Date, is true and
complete in all material respects; and




     (iv) (A) in the case of a removal of Accounts and related Receivables pursuant to
Section 2.8(b), satisfy the Rating Agency Condition with respect to such removal and
(B) deliver to the Trust, the Indenture Trustee, any Agent and any Enhancement Providers an
Officers’ Certificate, dated the Removal and Reassignment Date, confirming that such removal
will not cause an Early Amortization Event to occur for any Series or class of Notes.



     Within five Business Days after the Removal and Reassignment Date, the Trust shall deliver to the
Transferor a Reassignment, together with any appropriate UCC releases or termination statements.



     SECTION 2.9 Transfer of Ineligible Receivables. The Transferor shall sell to the
Trust on each Transfer Date any and all Receivables arising in any Eligible Accounts that are
Ineligible Receivables, provided that (a) on the Initial Cut-Off Date or, in the case of
Receivables arising in Additional Accounts, on the related Additional Cut-Off Date, and on the
applicable Transfer Date, the Account in which such Receivables arise is an Eligible Account and
(b) the Incremental Subordinated Amount is adjusted in accordance with the definition of
Incremental Subordinated Amount as defined in the related Series Supplement.



ARTICLE III




ADMINISTRATION AND SERVICING OF RECEIVABLES




     SECTION 3.1 Acceptance of Appointment and Other Matters Relating to the Servicer.



     (a) The Servicer shall service and administer the Receivables, shall collect payments due
under the Receivables and shall charge-off as uncollectible Receivables, all in accordance with its
Customary Servicing Practices in effect from time to time, using that same degree of skill and
attention that the Servicer exercises with respect to all comparable wholesale receivables that it
services for itself or others. The Servicer shall have full power and authority, acting alone or
through any party properly designated by it hereunder, to do any and all things in connection with
such servicing and administration which it may deem necessary or desirable. Without limiting the
generality of the foregoing and subject to Section 7.1, the Servicer is hereby authorized
and empowered, unless such power and authority is revoked by the Trust on account of the occurrence
of a Servicing Default pursuant to Section 7.1, (i) to instruct the Indenture Trustee to
make withdrawals and payments from the Collection Account and any Series Account as set forth in
this Agreement, (ii) to instruct the Owner Trustee to take any action required or permitted under
any Enhancement, (iii) to execute and deliver, on behalf of the Trust for the benefit of the
Residual Interestholder and the Beneficiaries, any and all instruments of satisfaction or
cancellation, or of partial or full release or discharge, and all other comparable instruments,
with respect to the Receivables and, after the delinquency of any Receivable and to the extent
permitted under and in compliance with applicable Requirements of Law, to commence enforcement proceedings with respect to such Receivables, (iv) to make any filings,



16









 




reports, notices, applications, registrations with, and seek any consents or authorizations from,
the Securities and Exchange Commission and any state securities authority on behalf of the Trust as
may be necessary or advisable to comply with any federal or state securities laws or reporting
requirement, and (v) to delegate all or any of its servicing, collection, enforcement and
administrative duties hereunder with respect to the Accounts and the Receivables to any Person who
agrees to conduct such duties in accordance with the Floorplan Financing Guidelines and this
Agreement, in each case if and to the extent applicable to the performance of such duties;
provided, however, that no delegation will relieve the Servicer of its liability
and responsibility with respect to such duties. The Owner Trustee shall furnish the Servicer with
any powers of attorney and other documents reasonably necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties hereunder.




     (b) In the event that the Transferor is unable for any reason to transfer Receivables to the
Trust in accordance with the provisions of this Agreement then, in any such event, the Servicer
agrees (i) to give prompt written notice thereof to the Owner Trustee, the Indenture Trustee, any
Enhancement Providers, any Agent and each Rating Agency and (ii) that it shall in any such event
allocate, after the occurrence of such event, payments on each Account with respect to the
principal balance of such Account first to the oldest principal balance of such Account, and to
have such payments applied as Collections in accordance with Section 8.2 of the Indenture.
The parties hereto agree that Non-Principal Receivables, whenever created, accrued in respect of
Principal Receivables which have been conveyed to the Trust shall continue to be a part of the
Trust and Trust Assets notwithstanding any cessation of the transfer of additional Principal
Receivables to the Trust, and Collections with respect to such Principal Receivables and
Non-Principal Receivables shall continue to be allocated and paid to the Trust in accordance with
the terms of this Agreement.



     (c) The Servicer shall not, and any Successor Servicer shall not be obligated to, use separate
servicing procedures, offices, employees or accounts for servicing the Receivables from the
procedures, offices, employees and accounts used by the Servicer in connection with servicing other
wholesale receivables.



     (d) The Servicer shall comply with and perform its servicing obligations with respect to the
Accounts and Receivables in accordance with the Floorplan Financing Agreements relating to the
Accounts and the Floorplan Financing Guidelines, except insofar as any failure to so comply or
perform would not materially and adversely affect the rights of the Trust or any of the
Beneficiaries. Subject to compliance with all Requirements of Law, the Servicer (or VCI) may
change the terms and provisions of the Floorplan Financing Agreements or the Floorplan Financing
Guidelines in any respect (including the calculation of the amount or the timing of charge-offs and
the rate of the finance charge assessed under these agreements), only if (i) as a result of such
change, in the reasonable judgment of the Servicer, no Early Amortization Event will occur at any
time and none of the Residual Interestholder or Beneficiaries shall be materially adversely
affected (it being understood that any reduction in the rate paid by Accounts will not materially
adversely affect the Residual Interestholder or Beneficiaries if it satisfies the condition in
clause (iii) below), (ii) such change is made applicable to the comparable segment of wholesale
accounts owned or serviced by the Servicer which have characteristics the same as, or substantially
similar to, the Accounts which are the subject of such change and (iii) in the case of a reduction in the rate of such finance charges, the Servicer (or VCI) does not reasonably
expect



17









 




any such reduction to result in the weighted average of the reference rates applicable to
the finance charges for any Collection Period being less than the weighted average of the sum of
the Note Rates (or, in the case of a Series with a fixed Note rate and a swap agreement, the
floating rate payable by the Trust under the swap agreement) and the Servicing Fee Rates for all
outstanding Series for the related Interest Period (each such term as defined in the related Series
Supplement).




     SECTION 3.2 Servicing Compensation. As full compensation for its servicing activities
hereunder and reimbursement for its expenses as set forth in the immediately following paragraph,
the Servicer shall be entitled to receive the Servicing Fee on each Payment Date on or prior to the
Trust Termination Date payable in arrears. The “Servicing Fee” shall be the aggregate of
the Monthly Servicing Fees specified in the Series Supplements. The Servicing Fee shall be payable
to the Servicer solely to the extent amounts are available for payment in accordance with the terms
of the applicable Series Supplement.



     The Servicer’s expenses, which it must pay whether or not it receives any payments from the
Trust for the Servicing Fee, include the amounts due to the Owner Trustee pursuant to Section
6.9 of the Trust Agreement and the Indenture Trustee pursuant to Section 6.7 of the
Indenture and the reasonable fees and disbursements of attorneys, independent accountants and all
other expenses incurred by the Servicer in connection with its activities hereunder, and all fees
and expenses of the Trust not expressly stated herein to be for the account of the Residual
Interestholder or the Beneficiaries. Except as otherwise provided in a Series Supplement, the
Servicer shall be required to pay such expenses for its own account, and shall not be entitled to
any payment therefor other than the Servicing Fee. Except as otherwise provided in a Series
Supplement, the Servicer will be solely responsible for all fees and expenses incurred by or on
behalf of the Servicer in connection herewith and the Servicer will not be entitled to any fee or
other payment from, or claim on, any of the Trust Assets (other than the Servicing Fee).



     SECTION 3.3 Representations, Warranties and Covenants of the Servicer.



     (a) VCI, as Servicer, hereby makes, and any Successor Servicer by its appointment hereunder
shall make, on each Closing Date (and on the date of any such appointment) the following
representations, warranties and covenants:




     (i) 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
Basic Documents or affect the enforceability or collectibility of the Receivables or any
other part of the Conveyed Assets.




     (ii) Authorization and No Contravention. The execution, delivery and
performance by VCI of each Basic 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 agreement, contract, order or other instrument to which
it



18









 





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 Basic Documents).




     (iii) Binding Effect. Each Basic 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
corporations from time to time in effect or by general principles of equity.




     (iv) 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 Basic
Documents, (ii) seeking to prevent the issuance of any Series of Notes or the consummation
of any of the transactions contemplated by this Agreement or any of the other Basic
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
Basic Documents, or (iv) relating to VCI that would materially and adversely affect the
federal or applicable state tax income, excise, franchise or similar tax attributes of any
Series of Notes.




     (v) Compliance with Requirements of Law. VCI shall duly satisfy all
obligations on its part to be fulfilled under or in connection with the Receivables and the
Accounts, will maintain in effect all qualifications required under Requirements of Law in
order to service properly the Receivables and the Accounts and will comply in all material
respects with all Requirements of Law in connection with servicing the Receivables and the
Accounts the failure to comply with which would have a material adverse effect on the
interests of the Residual Interest holder or the Beneficiaries.




     (vi) No Rescission or Cancellation. VCI shall not permit any rescission or
cancellation of a Receivable except as ordered by a court of competent jurisdiction or other
Governmental Authority.




     (vii) Protection of Beneficiaries Rights. VCI shall not take any action, nor
omit to take any action, which action or omission would impair the rights of Beneficiaries
in the Receivables nor shall it reschedule, revise or defer payments due on any Receivable
except in accordance with the Floorplan Financing Guidelines.




     (viii) Defense of Title. Except for the conveyances made pursuant to the Basic
Documents and Liens in favor of VDF, the Trust or the Indenture Trustee, the Servicer will
not sell, pledge, assign or transfer to any Person, or grant, create, incur, assume or
suffer to exist any Lien on, any Receivable sold and assigned to the Trust, whether now
existing or hereafter created, or any interest therein, and the Servicer shall defend the
rights, title and interest of the Trust in, to and under any Receivable sold and assigned to



19









 





the Trust, whether now existing or hereafter created, against all claims of third
parties claiming through or under the Servicer.



     (b) Notice of Breach. The representations and warranties set forth in this
Section 3.3 shall survive the transfer and assignment of the Receivables to the Trust and
the pledge of the Receivables to the Indenture Trustee pursuant to the Indenture. Upon discovery
by the Transferor, the Servicer, the Owner Trustee, or the Indenture Trustee of a breach of any of
the representations and warranties set forth in this Section 3.3, the party discovering
such breach shall give prompt written notice to the Transferor, the Servicer, the Indenture
Trustee, the Trust and to any Enhancement Providers.



     (c) Purchase. In the event any representation or warranty under Section
3.3(a)(v), (vi) or (vii) is not true and correct in any material respect as of the date
specified therein with respect to any Receivable or Account and such breach has a material adverse
effect on the value of such Receivable, then, within 30 days (or such longer period as may be
agreed to by the Trust) of the earlier to occur of the discovery of any such event by the
Transferor or the Servicer, or receipt by the Transferor or the Servicer of written notice of any
such event given by the Owner Trustee, the Indenture Trustee or any Enhancement Providers, the
Servicer shall purchase such Receivable or, in the case of an untrue representation with respect to
an Account, all Receivables in such Account, on the Determination Date immediately succeeding the
expiration of such 30-day period (or such longer period as may be agreed to by the Trust) on the
terms and conditions set forth in the next succeeding paragraph; provided, however,
that no such purchase shall be required to be made with respect to such Receivable if, by the end
of such 30-day period (or such longer period as may be agreed to by the Trust) the breached
representation or warranty shall then be true and correct in all material respects and any material
adverse effect caused thereby shall have been cured. The Servicer shall effect such purchase by
depositing in the Collection Account in immediately available funds an amount equal to the Purchase
Price of such Receivable. Any such deposit of such Purchase Price into the Collection Account
shall be considered a Transfer Deposit Amount and shall be applied in accordance with the terms of
this Agreement.



     Upon each such payment of such Purchase Price, the Trust shall automatically and without
further action be deemed to sell, transfer, assign, set over and otherwise convey to the Servicer,
without recourse, representation or warranty, all right, title and interest of the Trust in and to
such Receivables, all monies due or to become due with respect thereto and all proceeds thereof and
the Collateral Security. The Trust shall execute such documents and instruments of transfer or
assignment and take such other actions as shall be reasonably requested by the Servicer to effect
the conveyance of any such Receivables pursuant to this Section 3.3. The obligation of the
Servicer to purchase such Receivables, and to make the deposits required to be made to the
Collection Account as provided in the preceding paragraph, shall constitute the sole remedy
respecting the event giving rise to such obligation available to the Trust, the Residual
Interestholder (or the Owner Trustee on behalf of the Residual Interestholder) or the Noteholders
(or the Indenture Trustee on behalf of the Noteholders).



     SECTION 3.4 Reports and Records.



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     (a) On or before each Payment Date, with respect to each outstanding Series, the Servicer
shall deliver to Indenture Trustee and Indenture Trustee will forward to any Enhancement Providers,
the Rating Agencies and the Owner Trustee, a Payment Date Statement for such Payment Date and the
Indenture Trustee shall make such Payment Date Statement available to the Noteholders. Each such
statement to be delivered to the Noteholders and Residual Interestholder shall set forth the
following information concerning the Notes with respect to such Payment Date or the preceding
Collection Period:




     (i) the aggregate amount of Collections, the aggregate amount of Non-Principal
Collections and the aggregate amount of Principal Collections processed during the
immediately preceding Collection Period and the Pool Balance, and the Residual Participation
Amount and the amount on deposit in the Excess Funding Account as of the close of business
on the last day of the preceding Collection Period;




     (ii) the total amount of distributions, if any, made with respect to any Series or
Class of Notes;




     (iii) the amount, if any, of the distribution allocable to principal on each Series or
Class of Notes;




     (iv) the amount, if any, of the distribution allocable to interest on or with respect
to each Series or Class of Notes;




     (v) the Invested Amount and the aggregate Outstanding Amount for each Series or Class
of Notes, each as of such date and after giving effect to all payments reported under clause
(ii) above;




     (vi) the amount of the Monthly Servicing Fee and the Noteholder Monthly Servicing Fee
paid to the Servicer with respect to the related Collection Period or Periods, as the case
may be;




     (vii) the per annum interest rate for the next Payment Date for any Series or Class of
Notes with a variable or adjustable interest rate;




     (viii) the amount of Receivables that become Defaulted Receivables during the related
Collection Period;




     (ix) the accumulated interest and principal shortfalls, if any, on each Series or Class
of Notes and the change in each of such amounts from the preceding Payment Date;




     (x) the balance of Excess Funding Account on the related Determination Date after
giving effect to changes therein or any distributions therefrom on such date; and




     (xi) with respect to each Series of Notes, the items set forth in the applicable Series
Supplement.



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Each amount set forth pursuant to clauses (ii) and (iii) above with respect to the Notes shall be
expressed as a dollar amount per $1,000 of initial principal amount of the Notes.




     (b) Within the prescribed period of time for tax reporting purposes after the end of each
calendar year during the term of this Agreement, the Indenture Trustee shall furnish (or cause to
be furnished), to each Person who at any time during such calendar year shall have been a Holder of
record of Notes or the Residual Interestholder, respectively, and received any payment thereon, a
statement containing such information as may be required by the Code and applicable Treasury
Regulations to enable such Noteholder or Residual Interestholder to prepare its federal income tax
returns.



     (c) On or before each Advance Date or Pay Down Date, with respect to each outstanding Series
(if any), the Servicer shall deliver to any Enhancement Providers, the Rating Agencies, the Owner
Trustee, and the Indenture Trustee a Reset Date Statement for the related Reset Date substantially
in the form set forth in the Series Supplement for that Series of Notes.



     (d) A copy of each statement provided pursuant to Section 3.4(a) shall be made
available for inspection at the Corporate Trust Office.



     SECTION 3.5 Annual Servicer’s Certificate. The Servicer will deliver to the Rating
Agencies, the Owner Trustee, the Indenture Trustee, any Agent and any Enhancement Providers on or
before April 30 of each calendar year, beginning with April 30, 2006, an Officers’ Certificate
substantially in the form of Exhibit B stating that (a) a review of the activities of the
Servicer during the preceding calendar year (or since the Initial Closing Date, in the case of the
first such Officers’ Certificate) and of its performance under this Agreement was made under the
supervision of the officer signing such certificate and (b) to the best of such officer’s
knowledge, based on such review, the Servicer has performed in all material respects its
obligations under this Agreement throughout such year (or since the Initial Closing Date, in the
case of the first such Officers’ Certificate), or, if there has been a material default in the
performance of any such obligation, specifying each such default known to such officer and the
nature and status thereof. A copy of such certificate may be obtained by any Noteholder or the
Residual Interestholder by a request in writing to the Owner Trustee addressed to the Corporate
Trust Office.



     SECTION 3.6 Annual Independent Public Accountants’ Servicing Report. The Servicer
shall cause a firm of independent certified public accountants, who may also render other services
to the Servicer or to its Affiliates, to deliver to the Owner Trustee, the Indenture Trustee, the
Rating Agencies, each Agent and each Enhancement Provider on or before April 30 of each year, with
the next report due April 30, 2006, a report addressed to the board of directors of the Servicer,
to the effect that such firm (a) performed tests relating to wholesale receivables (including
financing arrangements with automobile dealers to finance their automobile and light-duty truck
inventory) serviced for others in accordance with the Uniform Single Attestation Program for
Mortgage Bankers (“USAP”), to the extent the procedures in such program are applicable to
the servicing obligations set forth in this Agreement, and (b) except as described in the report,
disclosed no exceptions or errors in the records relating to wholesale receivables (including
financing arrangements with automobile dealers to finance their automobile and light-duty truck
inventory) serviced for others that, in the firm’s opinion, paragraph four of such USAP requires
such firm to report. A copy of such report may be obtained by any Noteholder or



22









 




the Residual Interestholder by a request in writing to the Owner Trustee addressed to the
Corporate Trust Office. The report will also indicate that the firm is independent of the Servicer
within the meaning of the Code of Professional Ethics of the American Institute of Certified Public
Accountants. The certification required by this paragraph may be replaced by any similar
certification using standards other than USAP which are now or in the future in use by servicers of
comparable assets or which otherwise comply with any rule, regulation, “no action” letter or
similar guidance promulgated by the U.S. Securities and Exchange Commission.”




     SECTION 3.7 Tax Treatment. The Transferor has entered into this Agreement and the
Notes have been (or will be) issued with the intention that the Notes will qualify under applicable
tax law as indebtedness of VDF secured by the Receivables. The Transferor, each Beneficiary, the
Residual Interestholder and each Note Owner, by the acceptance of its Note or Book-Entry Note, as
applicable, agrees to treat the Notes as indebtedness of VDF secured by the Receivables for
Federal income taxes, state and local income, franchise, single business taxes and/or value added
taxes and any other taxes imposed on or measured by income in whole or in part.



     SECTION 3.8 Notices to VCI. In the event VCI is no longer acting as Servicer, any
Successor Servicer appointed pursuant to Section 7.2 shall deliver or make available to
VCI, as the case may be, each certificate and report required to be prepared, forwarded or
delivered thereafter pursuant to Sections 3.4, 3.5 or 3.6.



     SECTION 3.9 Adjustments.



     (a) If the Servicer adjusts downward the amount of any Principal Receivable because of a
rebate, refund, credit adjustment or billing error to a Dealer, or because such Receivable was
created in respect of a Vehicle which was refused or returned by a Dealer, then, in any such case,
the Pool Balance and the Residual Participation Amount shall be automatically reduced by the amount
of the adjustment. Furthermore, if following such a reduction the Residual Participation Amount
would be less than the Trust Available Subordinated Amount on the immediately preceding
Determination Date (after giving effect to the allocations, distributions, withdrawals and deposits
to be made on the Payment Date following such Determination Date), then the Transferor shall pay an
amount equal to such deficiency (up to the amount of such adjustment) into the Collection Account
within 5 Business Days after the day on which such adjustment or reduction occurs (each such
payment an “Adjustment Payment”).



     (b) If (i) the Servicer makes a deposit into the Collection Account in respect of a Collection
of a Receivable and such Collection was received by the Servicer in the form of a check which is
not honored for any reason or (ii) the Servicer makes a mistake with respect to the amount of any
Collection and deposits an amount that is less than or more than the actual amount of such
Collection, the Servicer shall appropriately adjust the amount subsequently deposited into the
Collection Account to reflect such dishonored check or mistake. Any Receivable in respect of which
a dishonored check is received shall be deemed not to have been paid.



     (c) If the Servicer adjusts downward the amount of interest otherwise payable on any
Receivable with respect to any Collection Period as a result of any interest rebate program, the
Servicer shall deposit into the Collection Account on or prior to the Payment Date related to such



23









 




Collection Period an amount equal to the amount of such rebate (each such payment, a “Rebate
Payment”).




ARTICLE IV




ALLOCATION AND APPLICATION OF COLLECTIONS




     SECTION 4.1 Establishment of Accounts.



     (a) The Servicer, for the benefit of the Noteholders, the Residual Interestholder and any
Enhancement Providers, shall cause to be established and maintained in the name of the Indenture
Trustee an Eligible Deposit Account bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Noteholders, the Residual Interestholder and any
Enhancement Providers (the “Collection Account”).



     (b) The Servicer, for the benefit of the Noteholders, shall cause to be established and
maintained in the name of the Indenture Trustee an Eligible Deposit Account bearing a designation
clearly indicating that the funds deposited therein are held for the benefit of the Noteholders
(the “Note Distribution Account”).



     (c) The Servicer, for the benefit of the Noteholders, the Residual Interestholder and the
Enhancement Providers shall cause to be established and maintained in the name of the Indenture
Trustee an Eligible Deposit Account bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Noteholders, the Residual Interestholder and any
Enhancement Providers (the “Excess Funding Account”).



     (d) The Indenture Trustee shall possess all right, title and interest in all funds from time
to time on deposit in, and all Eligible Investments credited to, the Trust Accounts and in all
proceeds thereof. The Trust Accounts shall be under the sole dominion and control of the Indenture
Trustee for the benefit of the Noteholders, the Residual Interestholder and any Enhancement
Providers. If, at any time, any Trust Account ceases to be an Eligible Deposit Account, the
Servicer shall establish a substitute Eligible Deposit Account as such Trust Account, instruct the
Indenture Trustee or the Trust as applicable, in writing, to transfer any cash and/or any Eligible
Investments to such new Trust Account and, from the date any such substitute account is
established, such account shall be the Trust Account. Neither the Transferor nor the Servicer, nor
any person or entity claiming by, through or under the Transferor or Servicer, shall have any
right, title or interest in, or any right to withdraw any amount from, the Trust Accounts.
Pursuant to the authority granted to the Servicer in Section 3.1, the Servicer shall have
the power, revocable by the Indenture Trustee (or by the Owner Trustee with the written consent of
the Indenture Trustee), to instruct the Indenture Trustee or the Trust as applicable, to make
withdrawals and payments from the Trust Accounts for the purposes of carrying out the Servicer’s or
the Trust’s duties specified in this Agreement or permitting the Indenture Trustee to carry out its
duties under the Indenture.



     All Eligible Investments shall be held by the Indenture Trustee or the Owner Trustee as
applicable, for the benefit of the Noteholder, the Residual Interestholder and any Enhancement
Providers. Funds on deposit in the Trust Accounts shall at the written direction of the Servicer



24









 




be invested by the Indenture Trustee or the Owner Trustee as applicable, solely in Eligible
Investments that will mature so that such funds will be available at the close of business on or
before the Business Day prior to the next Payment Date (or on or before 10:00 a.m. on such
following Payment Date in the case of Eligible Investments in respect of which the Indenture
Trustee is the obligor or Eligible Investments specified in clauses (h) or (j) of
the definition thereof). Unless otherwise specified in the related Series Supplement, all interest
and other investment earnings (net of losses and investment expenses) on funds on deposit in each
Trust Account shall be credited to the Trust Account when received. Schedule 3, which is
hereby incorporated into and made part of this Agreement, identifies the Trust Accounts by setting
forth the account numbers of each account, the account designation of each account and the name of
the Institution with which such accounts have been established. If a substitute Trust Account is
established pursuant to this Section 4.1, the Servicer shall provide to the Owner Trustee
and the Indenture Trustee an amended Schedule 3, setting forth the relevant information for
such substitute Trust Account. In the absence of timely and specific written investment direction
from the Servicer, the Indenture Trustee shall invest any cash held by it in Eligible Investments
specified in clause (h) of the definition thereof. In no event shall the Indenture Trustee be
liable for the selection of investments or for investment losses incurred thereon. The Indenture
Trustee shall have no liability in respect of losses incurred as a result of the liquidation of any
investment prior to its stated maturity or the failure of the Servicer to provide timely written
investment direction.




     SECTION 4.2 Allocations and Applications of Collections and Other Funds.



     (a) Except as otherwise provided in Section 4.2(b) and (c), the Servicer shall
deposit Collections into the Collection Account as promptly as possible after the Date of
Processing of such Collections, but in no event later than the second Business Day after such Date
of Processing.



     (b) Notwithstanding anything in this Agreement to the contrary, for so long as (i) VCI remains
the Servicer hereunder, (ii) no Servicer Default has occurred and is continuing and (iii) (x)
Volkswagen AG has a short-term debt rating of at least A-1 from Standard & Poor’s and P-1 from
Moody’s, (y) both Standard & Poor’s and Moody’s are then rating a debt issuance of VWOA or VCI
(and, in the case of VCI, such debt issuance is guaranteed by Volkswagen AG), and (z) VCI remains a
direct or indirect wholly owned subsidiary of Volkswagen AG, then the Servicer need not make the
daily deposits of Collections into the Collection Account as provided in Section 4.2(a),
but may make a single deposit into the Collection Account in the same-day or next-day funds not
later than 12:00 noon, New York City time, on the Payment Date in a net amount equal to the amount
which would have been on deposit with respect to the immediately preceding Collection Period in the
Collection Account.



     (c) Subject to Section 4.3, but notwithstanding anything else in this Agreement to the
contrary, (i) the Servicer will only be required to deposit Collections into the Collection Account
as set forth in paragraph (a) above up to the aggregate amount of Collections required to
be deposited into any Series Account or, without duplication, distributed on the related Payment
Date to Noteholders, to any Agent or to any Enhancement Provider pursuant to the terms of any
Series Supplement or Enhancement Agreement with respect to the related Collection Period and (ii)
if at any time prior to such Payment Date the amount of Collections deposited in the




25










 






Collection Account exceeds the amount required to be deposited pursuant to clause (i)
above, the Servicer will be permitted to withdraw the excess from the Collection Account.




     (d) Collections, Defaulted Amounts and Miscellaneous Payments will be allocated to each Series
as set forth in the applicable Series Supplement.



     SECTION 4.3 Excess Principal Collections. On each Determination Date, (a) the
Servicer shall allocate Excess Principal Collections (as described below) for the related
Collection Period to each Series as set forth in the related Series Supplement, and (b) the
Servicer shall instruct the Indenture Trustee in writing to withdraw from the Collection Account
and pay to the Residual Interestholder (i) an amount equal to the excess, if any, of (x) the
aggregate amount for all outstanding Series of Principal Collections that the related Series
Supplements specify are to be treated as “Excess Principal Collections” with respect to the related
Payment Date over (y) the aggregate amount for all outstanding Series that the related Series
Supplements specify are “Principal Shortfalls” with respect to such Payment Date and, without
duplication, (ii) the aggregate amount for all outstanding Series of that portion of Principal
Collections that the related Series Supplements specify are to be allocated and paid to the
Residual Interestholder with respect to such Payment Date; provided, however, that
in the case of clauses (i) and (ii), such amounts shall be paid to the Residual
Interestholder only if the Residual Participation Amount for such Payment Date (determined after
giving effect to any Principal Receivables transferred to the Trust on such Determination Date)
exceeds the Trust Available Subordinated Amount on such Determination Date (after giving effect to
the allocations, distributions, withdrawals and deposits to be made on such Payment Date). The
amount held in the Collection Account as a result of the proviso in the preceding sentence
(“Unallocated Principal Collections”) shall be paid to the Residual Interestholder at the
time the Residual Participation Amount exceeds the Trust Available Subordinated Amount for the
immediately preceding Determination Date (after giving effect to the allocations, distributions,
withdrawals and deposits to be made on the Payment Date immediately following such Determination
Date); provided, however, that any Unallocated Principal Collections on deposit in
the Collection Account at any time during which any Series is in its Amortization Period,
Accumulation Period, Controlled Amortization Period or Early Amortization Period shall be deemed to
be Miscellaneous Payments and shall be allocated and distributed in accordance with Section
4.2 and the terms of each Series Supplement.



     SECTION 4.4 Excess Funding Account.



     (a) In addition to any other amounts permitted or required to be deposited into the Excess
Funding Account pursuant to the Basic Documents, at the direction of the Residual Interestholder to
the Servicer, Owner Trustee and Indenture Trustee, any amounts otherwise distributable to the
Residual Interestholder pursuant to the terms of this Agreement, the Indenture (including any
Series Supplement) and the Trust Agreement, shall be deposited into the Excess Funding Account.



     (b) The net proceeds from the issuance of any new Series of Notes or the increase in the
Invested Amount of any Series of Notes, first, shall be deposited into the Excess Funding Account
such that the Pool Balance is not less than the Required Participation Amount and,



26









 




second, shall be paid to the Residual Interestholder as provided in the Trust Agreement or, to
the extent requested by the Residual Interestholder, deposited into the Excess Funding Account.




     (c) Unless an Early Amortization Event shall have occurred, amounts on deposit in the Excess
Funding Account may be used to repay the outstanding principal amount of any Series of Notes to the
extent required or permitted by the terms of the related Series Supplement.



     (d) At the request of the Residual Interestholder any amount held in the Excess Funding
Account in excess of the amount required so that the Pool Balance is not less than the Required
Participation Amount shall be paid to the Residual Interestholder at the time and to the extent
requested by the Residual Interestholder; provided, however, unless the Series
Supplement provides otherwise, any such amounts on deposit in the Excess Funding Account at any
time during which any Series is in its Early Amortization Period, Accumulation Period, Controlled
Amortization Period or Amortization Period shall be deemed to be a Miscellaneous Payment and shall
be allocated and distributed in accordance with the Series Supplement.



     SECTION 4.5 Net Deposits. The Servicer, the Transferor, the Indenture Trustee and the
Owner Trustee may make any remittances pursuant to this Article IV net of amounts to be
distributed by the applicable recipient to such remitting party. Nonetheless, each such party
shall account for all of the above described remittances and distributions as if the amounts were
deposited and/or transferred separately.



     SECTION 4.6 Excess Non-Principal Collections. On each Determination Date, (a) the
Servicer shall allocate Excess Non-Principal Collections (as described below) for the related
Collection Period to each Series as set forth in the related Series Supplement, and (b) the
Servicer shall instruct the Indenture Trustee in writing to withdraw from the Collection Account
and pay to the Residual Interestholder (i) an amount equal to the excess, if any, of (x) the
aggregate amount for all outstanding Series of Non-Principal Collections that the related Series
Supplements specify are to be treated as “Excess Non-Principal Collections” with respect to the
related Payment Date over (y) the aggregate amount for all outstanding Series that the related
Series Supplements specify are “Non-Principal Shortfalls” with respect to such Payment Date and,
without duplication, (ii) the aggregate amount for all outstanding Series of that portion of
Non-Principal Collections that the related Series Supplements specify are to be allocated and paid
to the Residual Interestholder with respect to such Payment Date.



ARTICLE V




DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS AND THE RESIDUAL

INTERESTHOLDER




     Distributions shall be made to, and reports shall be provided to, the Noteholders and the
Residual Interestholder as set forth in the Indenture, the Trust Agreement and the applicable
Series Supplement.



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ARTICLE VI




OTHER MATTERS RELATING TO THE SERVICER




     SECTION 6.1 Liability of the Servicer. The Servicer shall be liable under this
Article VI only to the extent of the obligations specifically undertaken by the Servicer in its
capacity as Servicer.



     SECTION 6.2 Merger or Consolidation of, or Assumption of, the Obligations
of the Servicer. The Servicer shall not consolidate with or merge into any other corporation
or convey or transfer its properties and assets substantially as an entirety to any Person, unless:



     (a) the corporation formed by such consolidation or into which the Servicer is merged or the
Person which acquires by conveyance or transfer the properties and assets of the Servicer
substantially as an entirety shall be a corporation organized and existing under the laws of the
United States of America or any state or the District of Columbia and, if the Servicer is not the
surviving entity, such corporation shall assume, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, the performance of every covenant and
obligation of the Servicer hereunder; and



     (b) the Servicer has delivered to the Owner Trustee and the Indenture Trustee an Officers’
Certificate and an Opinion of Counsel each stating that such consolidation, merger, conveyance or
transfer will comply with this Section 6.2 and that all conditions precedent herein
provided for relating to such transaction have been complied with. Following any merger of the
Servicer to which VW Credit, Inc. is not the survivor, the Servicer will promptly provide the
Rating Agencies notice of such merger.



     SECTION 6.3 Limitation on Liability of the Servicer and Others.



     (a) Except as provided in Section 6.4, neither the Servicer nor any of the directors
or officers or employees or agents of the Servicer, shall be under any liability to the Trust, the
Owner Trustee, the Indenture Trustee, the Noteholders, the Residual Interestholder, the Enhancement
Providers, the Agent or any other Person for any action taken or for refraining from the taking of
any action in its capacity as Servicer pursuant to this Agreement; provided,
however, that this provision shall not protect the Servicer or any such person against any
liability which would otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of duties or by reason of reckless disregard of obligations and
duties hereunder. The Servicer and any director or officer or employee or agent of the Servicer
may rely in good faith on any document of any kind prima facie properly executed and submitted by
any Person respecting any matters arising hereunder. The Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action which is not incidental to its duties
to service the Receivables in accordance with this Agreement which in its reasonable opinion may
involve it in any expense or liability.



     (b) Except as provided in this Agreement, the Servicer shall not be under any obligation to
appear in, prosecute or defend any legal action that is not incidental to its duties to service the
Receivables in accordance with this Agreement and that in its opinion may involve it



28









 




in any expense or liability; provided, however, that the Servicer may
undertake any reasonable action that it may deem necessary or desirable in respect of this
Agreement and the rights and duties of the parties to this Agreement and the interests of the
Noteholders and the Residual Interestholder under this Agreement, the interests of the Noteholders
under the Indenture and the interests of the Residual Interestholder under the Trust Agreement.




     SECTION 6.4 Servicer Indemnification of the Trust, the Indenture Trustee and the
Owner Trustee.



     (a) The Servicer out of its own funds shall indemnify, defend and hold harmless the Trust, for
the benefit of the Residual Interestholder, the Beneficiaries, the Owners Trustee and the Indenture
Trustee, and their respective officers, directors, employees and agents, from and against any taxes
that may at any time be asserted against any such Person with respect to the transactions
contemplated in this Agreement, including, without limitation, any sales, gross receipts, general
corporation, tangible personal property, privilege or license taxes (but not including any taxes
asserted with respect to, or arising out of, (i) the sale of any Eligible Receivables to the Trust
hereunder, (ii) the issuance and original sale of any Notes, (iii) ownership or sale of any
Eligible Receivables in the Accounts in the Pool of Accounts, the Notes or the Residual Interest,
(iv) distributions or the receipt of payment on the Notes or the Residual Interest or (v) any fees
or other compensation payable to any such Person) and costs and expenses in defending against the
same.



     (b) The Servicer out of its own funds shall indemnify and hold harmless the Trust, for the
benefit of the Residual Interestholder and the Beneficiaries, the Owner Trustee and the Indenture
Trustee, and their respective officers, directors, employees and agents, from and against any loss,
liability, expense, damage or injury suffered or sustained by reason of any acts, omissions or
alleged acts or omissions arising out of activities of the Servicer pursuant to this Agreement;
provided, however, that the Servicer shall not indemnify if such acts, omissions or
alleged acts or omissions constitute fraud, gross negligence, breach of fiduciary duty or willful
misconduct by the Owner Trustee or the Indenture Trustee; and provided further that
the Servicer shall not indemnify for any liabilities, cost or expense of the Trust with respect to
any action taken by the Owner Trustee at the request of the Residual Interestholder or any
Beneficiaries to the extent the Owner Trustee is fully indemnified by such Residual Interestholder
or Beneficiaries with respect to such action.



     (c) The Servicer out of its own funds shall indemnify, defend and hold harmless the Indenture
Trustee and the Owner Trustee, and their respective officers, directors, employees and agents, from
and against any loss, liability, expense, damage or injury arising out of or incurred in connection
with (x) in the case of the Indenture Trustee, the Indenture Trustee’s performance of its duties
under the Indenture, (y) in the case of the Owner Trustee, the Owner Trustee’s performance of its
duties under the Trust Agreement or (z) the acceptance, administration or performance by, or action
or inaction of, the Indenture Trustee or the Owner Trustee, as applicable, of the trusts and duties
contained in the Basic Documents, except in each case to the extent that such cost, expense, loss,
claim, damage or liability: (A) is due to the willful misfeasance, bad faith, or negligence
(except for errors in judgment) of the Person seeking to be indemnified, (B) to the extent
otherwise payable to the Indenture Trustee, arises from the Indenture Trustee’s breach of any of
its representations or warranties in Section 6.13 of the



29









 




Indenture, (C) to the extent otherwise payable to the Owner Trustee, arises from the Owner
Trustee’s breach of any of its representations or warranties set forth in Section 6.6 of
the Trust Agreement or (D) shall arise out of or be incurred in connection with the performance by
the Indenture Trustee of the duties of successor Servicer hereunder.




     (d) Indemnification under this Section 6.4 shall include, without limitation, any
judgment, award, settlement, reasonable attorneys’ fees and expenses and other costs or expenses as
incurred in connection with the defense of any actual or threatened action, proceeding or claim;
provided, however, that if the Servicer has made any indemnity payments pursuant to
this Section 6.4 and the recipient thereafter collects any of such amounts from others, the
recipient shall promptly repay such amounts collected to the Servicer, without interest.



     (e) Any indemnification under this Section 6.4 shall survive the termination of this
Agreement and the resignation and removal of the Owner Trustee or the Indenture Trustee.



     SECTION 6.5 The Servicer Not to Resign. The Servicer shall not resign from the
obligations and duties hereby imposed on it except (a) upon determination that (i) the performance
of its duties hereunder is no longer permissible under applicable law and (ii) there is no
reasonable action which the Servicer could take to make the performance of its duties hereunder
permissible under applicable law or (b) the Rating Agency Condition is satisfied with respect
thereto. Any such determination permitting the resignation of the Servicer shall be evidenced as
to clause (a) above by an Opinion of Counsel to such effect delivered to the Owner Trustee and the
Indenture Trustee. No such resignation shall become effective until the Indenture Trustee or a
Successor Servicer shall have assumed the responsibilities and obligations of the Servicer in
accordance with Section 7.2 hereof. If the Indenture Trustee is unable within 120 days of
the date of such determination to appoint a Successor Servicer, the Indenture Trustee shall serve
as Successor Servicer hereunder.



     SECTION 6.6 Access to the Documentation and Information Regarding the Receivables.
The Servicer shall provide to the Owner Trustee and the Indenture Trustee access to any and all
documentation regarding the Accounts and the Receivables in such cases where the Owner Trustee and
the Indenture Trustee are required in connection with the enforcement of the rights of the
Noteholders, the Residual Interestholder, or by applicable statutes or regulations to review such
documentation, such access being afforded without charge but only (a) upon reasonable request, (b)
during normal business hours, (c) subject to the Servicer’s normal security and confidentiality
procedures and (d) at offices designated by the Servicer. Nothing in this Section 6.6
shall derogate from the obligation of the Transferor, the Owner Trustee, the Indenture Trustee or
the Servicer to observe any applicable law prohibiting disclosure of information regarding the
Dealers and the failure of the Servicer to provide access as provided in this Section 6.6
as a result of such obligation shall not constitute a breach of this Section 6.6.



     SECTION 6.7 Delegation of Duties. The Servicer may, at any time without notice or
consent, delegate (i) any or all duties under this Agreement to any Person more than 50% of the
voting securities of which are owned, directly or indirectly, by Volkswagen AG or any successor
thereto, or (ii) specific duties to sub-contractors who are in the business of performing such
duties; provided, however, that no such delegation shall relieve the Servicer of
its responsibility with respect to such duties and the Servicer shall remain obligated and liable
for servicing and



30









 




administering the Receivables in accordance with this Agreement as if the Servicer alone were
performing such duties




     SECTION 6.8 Examination of Records. The Transferor and the Servicer shall indicate
generally in its computer files or other records that the Receivables arising in the Accounts have
been conveyed to the Trust pursuant to this Agreement for the benefit of the Residual
Interestholder and the Beneficiaries. The Transferor and the Servicer shall, prior to the sale or
transfer to a third party of any receivable held in its custody, examine its computer and other
records to determine that such receivable is not a Receivable.



ARTICLE VII




SERVICING DEFAULTS




     SECTION 7.1 Servicing Defaults. Any of the following events shall constitute a
“Servicing Default”:



     (a) failure by the Servicer to make any payment, transfer or deposit, or to give instructions
to the Owner Trustee or the Indenture Trustee to make any payment, transfer or deposit or to give
instructions to the Owner Trustee or the Indenture Trustee as to any action to be taken under any
Enhancement Agreement on or before the date occurring five Business Days after the date such
payment, transfer or deposit or such instruction is required to be made or given, as the case may
be, under the terms of this Agreement;



     (b) failure on the part of the Servicer duly to observe or to perform any other covenants or
agreements of the Servicer set forth in this Agreement which failure has a material adverse effect
on the Noteholders of any Series and which continues unremedied for a period of 30 days after the
date on which written notice of such failure, requiring the same to be remedied, shall have been
given to the Servicer by the Indenture Trustee or Owner Trustee; or the Servicer shall delegate its
duties under this Agreement, except as permitted by Sections 3.1 and 6.7;



     (c) any representation, warranty or certification made by the Servicer in this Agreement or in
any certificate delivered pursuant to this Agreement shall prove to have been incorrect when made,
which has a material adverse effect on the rights of the Noteholders of any Series and the material
adverse effect continues for a period of 60 days after the date on which written notice thereof,
requiring the same to be remedied, shall have been given to the Servicer by the Indenture Trustee
or Owner Trustee; or



     (d) a Bankruptcy Event shall have occurred with respect to the Servicer.



     In the event any Servicing Default occurs, so long as the Servicing Default shall not have
been remedied, the Indenture Trustee, by notice then given in writing to the Servicer (a
“Termination Notice”) with a copy to the Owner Trustee, may terminate all but not less than
all of the rights and obligations (other than its obligations that have accrued up to the time of
such termination) of the Servicer as Servicer under this Agreement and in and to the Receivables
and the proceeds thereof. After receipt by the Servicer of a Termination Notice, and on the date
that a Successor Servicer shall have been appointed by the Indenture Trustee pursuant to
Section 7.2, all authority and power of the Servicer under this Agreement shall pass to and
be vested in a



31









 




Successor Servicer (a “Servicing Transfer”) and, without limitation, the Indenture
Trustee is hereby authorized and empowered (upon the failure of the Servicer to cooperate) to
execute and deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, all documents and
other instruments upon the failure of the Servicer to execute or deliver such documents or
instruments, and to do and accomplish all other acts or things necessary or appropriate to effect
the purposes of such Servicing Transfer. The Servicer agrees to cooperate with the Indenture
Trustee and such Successor Servicer in effecting the termination of the responsibilities and rights
of the Servicer to conduct servicing hereunder, including the transfer to such Successor Servicer
of all authority of the Servicer to service the Receivables provided for under this Agreement,
including all authority over all Collections which shall on the date of transfer be held by the
Servicer for deposit, or which have been deposited by the Servicer, in the Collection Account, or
which shall thereafter be received with respect to the Receivables, and in assisting the Successor
Servicer. The Servicer shall promptly transfer its electronic records relating to the Receivables
to the Successor Servicer in such electronic form as the Successor Servicer may reasonably request
and shall promptly transfer to the Successor Servicer all other records, correspondence and
documents necessary for the continued servicing of the Receivables in the manner and at such times
as the Successor Servicer shall reasonably request. To the extent that compliance with this
Section 7.1 shall require the Servicer to disclose to the Successor Servicer information of
any kind which the Servicer reasonably deems to be confidential, the Successor Servicer shall be
required to enter into such customary licensing and confidentiality agreements as the Servicer
shall deem necessary to protect its interest.




     Notwithstanding the foregoing, a delay in or failure of performance under Section
7.1(a) for a period of 10 Business Days or under Section 7.1(b) or (c) for a
period of 60 Business Days, shall not constitute a Servicing Default if such delay or failure could
not be prevented by the exercise of reasonable diligence by the Servicer and such delay or failure
was caused by an act of God or the public enemy, acts of declared or undeclared war, vandalism,
public disorder, rebellion or sabotage, accidents, epidemics, landslides, lightning, fire,
hurricanes, earthquakes, floods, strikes, labor disputes, mechanical breakdown, shortages or delays
in obtaining parts or suitable equipment, material, labor or transportation, acts of
subcontractors, interruption of utility services, acts of any unit of governmental agency, or other
similar or dissimilar occurrences. The preceding sentence shall not relieve the Servicer from using
its best efforts to perform its obligations in a timely manner in accordance with the terms of this
Agreement and the Servicer shall provide the Owner Trustee, Indenture Trustee, any Agents, the
Residual Interestholder, the Rating Agencies, any Enhancement Providers, the Transferor and the
Noteholders with an Officers’ Certificate giving prompt notice of such failure or delay by it,
together with a description of its efforts so to perform its obligations. The Servicer shall
immediately notify the Owner Trustee in writing of any Servicing Default.



     SECTION 7.2 Indenture Trustee to Act; Appointment of Successor.



     (a) On and after the receipt by the Servicer of a Termination Notice pursuant to Section
7.1, the Servicer shall continue to perform all servicing functions under this Agreement until
the date specified in the Termination Notice or otherwise specified by the Indenture Trustee in
writing or, if no such date is specified in such Termination Notice, or otherwise specified by the
Indenture Trustee, until a date mutually agreed upon by the Servicer and the Indenture Trustee.
The Indenture Trustee shall as promptly as possible after the giving of a Termination



32









 




Notice appoint an Eligible Servicer as a successor Servicer (the “Successor
Servicer”), subject to the consent of any Enhancement Providers and any Agents, which consent
shall not be unreasonably withheld, and such Successor Servicer shall accept its appointment by a
written assumption in a form acceptable to the Indenture Trustee. In the event that a Successor
Servicer has not been appointed or has not accepted its appointment at the time when the Servicer
ceases to act as Servicer, the Indenture Trustee without further action shall automatically be
appointed the Successor Servicer, and the Indenture Trustee may delegate any of its servicing
obligations to an affiliate or agent in accordance with Sections 3.1 and 6.7.
Notwithstanding the above, the Indenture Trustee shall, if it is unwilling or legally unable so to
act, petition a court of competent jurisdiction to appoint any established institution having a net
worth of not less than $100,000,000 and whose regular business includes the servicing of wholesale
receivables as the Successor Servicer hereunder. The Indenture Trustee shall promptly give notice
to the Owner Trustee, the Rating Agencies, any Enhancement Providers, any Agents, the Residual
Interestholder and the Noteholders upon the appointment of a Successor Servicer. Notwithstanding
anything herein or in the Indenture to the contrary, in no event shall the Indenture Trustee be
liable for any Servicing Fee or for any differential in the amount of the Servicing Fee paid
hereunder and the amount necessary to induce any Successor Servicer to act as Successor Servicer
under this Agreement and the transactions contemplated hereby.




     (b) Upon its appointment, the Successor Servicer shall be the successor in all respects to the
Servicer with respect to servicing functions under this Agreement and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof (except that the Successor Servicer shall not be liable for any liabilities
incurred by the predecessor Servicer), and all references in this Agreement to the Servicer shall
be deemed to refer to the Successor Servicer. Any Successor Servicer, by its acceptance of its
appointment, will automatically agree to be bound by the terms and provisions of any Enhancement
Agreement.



     (c) In connection with any Termination Notice, the Indenture Trustee will review any bids
which it obtains from Eligible Servicers and shall be permitted to appoint any Eligible Servicer
submitting such a bid as a Successor Servicer for servicing compensation not in excess of the
Servicing Fee (provided that if all such bids exceed the Servicing Fee the Residual Interestholder
at its own expense shall pay when due the amount of any compensation in excess of the Servicing
Fee); provided, however, that the Residual Interestholder shall be responsible for
payment of the Residual Interestholder’s portion of the Servicing Fee as determined pursuant to
this Agreement and all other amounts in excess of the Investors’ Servicing Fee, and that no such
monthly compensation paid out of Collections shall be in excess of the Investors’ Servicing Fee
permitted to the Servicer. The Residual Interestholder agrees that if VCI (or any Successor
Servicer) is terminated as Servicer hereunder, the portion of Collections to be paid to the
Residual Interestholder shall be reduced by an amount sufficient to pay the Residual
Interestholder’s share of the compensation of the Successor Servicer.



     (d) All authority and power granted to the Successor Servicer under this Agreement shall
automatically cease and terminate upon termination of the Trust pursuant to Section 7.1 of
the Trust Agreement, and shall pass to and be vested in the Transferor and, without limitation, the
Transferor is hereby authorized and empowered to execute and deliver, on behalf of the Successor
Servicer, as attorney-in-fact or otherwise, all documents and other instruments, and to



33









 




do and accomplish all other acts or things necessary or appropriate to effect the purposes of
such transfer of servicing rights. The Successor Servicer agrees to cooperate with the Transferor
in effecting the termination of the responsibilities and rights of the Successor Servicer to
conduct servicing on the Receivables. The Successor Servicer shall transfer its electronic records
relating to the Receivables to the Transferor in such electronic form as the Transferor may
reasonably request and shall transfer all other records, correspondence and documents to the
Transferor in the manner and at such times as the Transferor shall reasonably request in writing.
To the extent that compliance with this Section 7.2(d) shall require the Successor Servicer
to disclose to the Transferor information of any kind which the Successor Servicer deems to be
confidential, the Transferor shall be required to enter into such customary licensing and
confidentiality agreements as the Successor Servicer shall deem necessary to protect its interests.




     SECTION 7.3 Notification to Noteholders and Residual Interestholder. Upon any
termination of, or appointment of a successor to, the Servicer pursuant to this Article VII, the
Indenture Trustee shall give prompt written notice thereof to the Noteholders and the Rating
Agencies and the Owner Trustee shall give prompt written notice thereof to the Residual
Interestholder.



     SECTION 7.4 Waiver of Past Defaults. Noteholders whose Notes evidence not less than a
majority of the Outstanding Amount of the Notes as of the close of the preceding Payment Date (or,
if all of the Notes have been paid in full and the Indenture has been discharged in accordance with
its terms, the Residual Interestholder) voting as a single class, may, on behalf of all
Noteholders, waive any default by the Servicer in the performance of its obligations hereunder and
under the Receivables Purchase Agreement and its consequences, except a Servicing Default under
Section 7.1(a) of this Agreement. Upon any such waiver of a past default, such default
shall cease to exist, and any Servicing Default arising therefrom shall be deemed to have been
remedied for every purpose of this Agreement and the Receivables Purchase Agreement. No such
waiver shall extend to any subsequent or other default or impair any right consequent thereon.



ARTICLE VIII




MISCELLANEOUS PROVISIONS




     SECTION 8.1 Amendment.



     (a) Any term or provision of this Agreement may be amended by the Transferor and the Servicer
without the consent of the Indenture Trustee, any Noteholder, the Administrator, any Enhancement
Provider or any other Person; provided that (i) with respect to each Outstanding Series, either (A)
any amendment that materially and adversely affects the interests of the Noteholders of such
Outstanding Series shall require the consent of Noteholders evidencing not less than a majority of
the aggregate outstanding principal amount of the Notes of such Outstanding Series or (B) such
amendment shall not, as evidenced by an Officer’s Certificate of the Transferor delivered to the
Indenture Trustee and the Owner Trustee, materially and adversely affect the interests of the
Noteholders of such Outstanding Series and (ii) any amendment that materially and adversely affects
the interests of the Administrator, the Residual Interestholder, any Enhancement Provider, the
Indenture Trustee or the Owner Trustee shall



34









 




require the prior written consent of the Persons whose interests are materially and adversely
affected. The consent of the Administrator, the Residual Interestholder, any Enhancement Provider,
the Indenture Trustee shall be deemed to have been given if the Transferor does not receive a
written objection from such Person within 10 Business Days after a written request for such consent
shall have been given.




     (b) It shall not be necessary for the consent of any Person pursuant to this Section for such
Person to approve the particular form of any proposed amendment, but it shall be sufficient if such
Person consents to the substance thereof.



     (c) Notwithstanding the foregoing, no amendment shall (i) reduce the interest rate or
principal amount of any Note, or change the due date of any installment of principal of or interest
on any Note, or the Redemption Price with respect thereto, without the consent of the Holder of
such Note, or (ii) reduce the percentage of the aggregate outstanding principal amount of the
Outstanding Notes, the Holders of which are required to consent to any matter without the consent
of the Holders of at least the percentage of the aggregate outstanding principal amount of the
Outstanding Notes which were required to consent to such matter before giving effect to such
amendment.



     (d) Notwithstanding anything herein to the contrary, any term or provision of this Agreement
may be amended by the parties hereto without the consent of any of the Noteholders of any
Outstanding Series or any other Person to add, modify or eliminate any provisions as may be
necessary or advisable in order to comply with or obtain more favorable treatment under or with
respect to any law or regulation or any accounting rule or principle (whether now or in the future
in effect); it being a condition to any such amendment that the Rating Agency Condition shall have
been satisfied.



     (e) Prior to the execution of any amendment to this Agreement, the Transferor shall provide
each Rating Agency with written notice of the substance of such amendment. No later than 10
Business Days after the execution of any amendment to this Agreement, the Transferor shall furnish
a copy of such amendment to each Rating Agency, the Issuer, the Owner Trustee, any Enhancement
Provider and the Indenture Trustee.



     SECTION 8.2 Nonpetition Covenant. With respect to each Bankruptcy Remote Party, each
party hereto agrees that, prior to the date which is one year and one day after payment in full of
all obligations under each Financing (i) no party hereto shall authorize such 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 any party



35









 




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. Each of the parties hereto agrees that,
prior to the date which is one year and one day after the payment in full of all obligations under
each Financing, it will not institute against, or join any other Person in instituting against, any
Bankruptcy Remote Party an action in bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or similar proceeding under the laws of the United States or any State of
the United States.




     SECTION 8.3 Choice of Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF OR
OF ANY OTHER JURISDICTION, OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.



     SECTION 8.4 Notices. All demands, notices and communications upon or to the Servicer,
the Transferor, the Administrator, the Indenture Trustee, the Trust or the Rating Agencies or the
Residual Interestholder or Noteholder under this Agreement shall be delivered as specified in
Appendix B to this Agreement.



     SECTION 8.5 Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid,
then such covenants, agreements, provisions or terms shall be deemed enforceable to the fullest
extent permitted, and if not so permitted, shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Notes or rights of the
Noteholders.



     SECTION 8.6 Assignment. Notwithstanding anything to the contrary contained herein,
except as provided in Section 6.2, this Agreement may not be assigned by the Servicer.



     SECTION 8.7 Further Assurances. The Transferor and the Servicer agree to do and
perform, from time to time, any and all acts and to execute any and all further instruments
required or reasonably requested by the Trust more fully to effect the purposes of this Agreement,
including the execution of any financing statements or continuation statements relating to the
Receivables for filing under the provisions of the UCC of any applicable jurisdiction.



     SECTION 8.8 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Trust or the Noteholders, any right, remedy, power or privilege
under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege under this Agreement preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The rights,



36









 




remedies, powers and privileges provided under this Agreement are cumulative and not
exhaustive of any rights, remedies, powers and privileges provided by law.




     SECTION 8.9 Counterparts. This Agreement may be executed in two or more counterparts
(and by different parties on separate counterparts), each of which shall be an original, but all of
which together shall constitute one and the same instrument.



     SECTION 8.10 Third-Party Beneficiaries. This Agreement will inure to the benefit of
and be binding upon the parties hereto, the Indenture Trustee, the Owner Trustee, the Noteholders,
the Residual Interestholder, the Enhancement Providers and their respective successors and
permitted assigns. Except as otherwise expressly provided in this Agreement, no other Person will
have any right or obligation hereunder.



     SECTION 8.11 Action by Owner Trustee. Upon any application or request by the
Transferor or Servicer to the Owner Trustee to take any action under any provision under this
Agreement, the Transferor or Servicer, as the case may be, shall furnish to the Owner Trustee an
Officer’s Certificate stating that all conditions precedent, if any, provided for in this Agreement
relating to the proposed action have been complied with. The Owner Trustee shall be entitled to
conclusively rely on the Officer’s Certificate as authority for any action undertaken in connection
therewith.



     SECTION 8.12 Merger and Integration. Except as specifically stated otherwise herein,
this Agreement sets forth the entire understanding of the parties relating to the subject matter
hereof, and all prior understandings, written or oral, are superseded by this Agreement. This
Agreement may not be modified, amended, waived, or supplemented except as provided herein.



     SECTION 8.13 Headings. The headings herein are for purposes of reference only and
shall not otherwise affect the meaning or interpretation or any provision hereof.



     SECTION 8.14 No Recourse.



     (a) The Residual Interestholder acknowledges that the Residual Interest represents an
undivided ownership interest in the Trust only and does not represent interests in or obligations
of the Transferor, the Servicer, the Administrator, the Owner Trustee, the Indenture Trustee or any
Affiliate thereof and no recourse, either directly or indirectly, may be had against such parties
or their assets, except as may be expressly set forth or contemplated in this Agreement or the
Basic Documents.



     (b) It is expressly understood and agreed by the parties hereto that (a) this Agreement is
executed and delivered by The Bank of New York (Delaware), not individually or personally but
solely as trustee of the Trust, in the exercise of the powers and authority conferred and vested in
it, (b) each of the representations, undertakings and agreements herein made on the part of the
Trust is made and intended not as personal representations, undertakings and agreements by The Bank
of New York (Delaware) but is made and intended for the purpose of binding only the Trust, (c)
nothing herein contained shall be construed as creating any liability on The Bank of New York
(Delaware), individually or personally, to perform any covenant either expressed or implied
contained herein, all such liability, if any, being expressly waived by the parties hereto



37









 




and by any Person claiming by, through or under the parties hereto and (d) under no
circumstances shall The Bank of New York (Delaware) be personally liable for the payment of any
indebtedness or expenses of the Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Trust under this Agreement or any
other related documents.




     SECTION 8.15 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, any documents executed and delivered in connection herewith or for recognition and
enforcement of any judgment in respect thereof, to the non-exclusive 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 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 Appendix B to this
Agreement; 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.



* * * *




38









 





     IN WITNESS WHEREOF, the Transferor, the Servicer and the Trust have caused this Agreement to
be duly executed by their respective officers as of the day and year first above written.



	 	 	 	 	 
	 	 	VW CREDIT, INC.,
	 	 	as Servicer
	 
	 	 	 	 
	 

	 	By:
	 	/s/ David Schulz
	 

	 	 	 	 
	 	 	Name: David Schulz
	 	 	Title: Treasurer
	 
	 	 	 	 
	 

	 	By:
	 	/s/ LeSha Thorpe
	 

	 	 	 	 
	 	 	Name: LeSha Thorpe
	 	 	Title: Assistant Treasurer
	 
	 	 	 	 
	 	 	VOLKSWAGEN DEALER FINANCE, LLC,
	 	 	as Transferor
	 
	 	 	 	 
	 

	 	By:
	 	/s/ David Schulz
	 

	 	 	 	 
	 	 	Name: David Schulz

Title: President and Treasurer
	 
	 	 	 	 
	 

	 	By:
	 	/s/ LeSha Thorpe
	 

	 	 	 	 
	 	 	Name: LeSha Thorpe
	 	 	Title: Assistant Treasurer
	 
	 	 	 	 
	 	 	VOLKSWAGEN CREDIT AUTO MASTER
 OWNER TRUST
	 
	 	 	 	 
	 	 	By: The Bank of New York (Delaware), not in its

individual capacity, but solely as Owner Trustee
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Kristine K. Gullo
	 

	 	 	 	 
	 	 	Name: Kristine K. Gullo

Title: Vice President






Acknowledged and Accepted:

JPMORGAN CHASE BANK, N.A., not in

its individual capacity, but solely as

Indenture Trustee



	 	 	 	 	 	 	 
	By:

	 	/s/ James P. Bowden	 	 	 	 
	 

	 	 	 	 	 	 
	Name: James P. Bowden

Title: Assistant Treasurer	 	 	 	 






Amended and Restated

Trust Sale and Servicing Agreement





 









 








APPENDIX A




PART I — DEFINITIONS




     Whenever used in this Agreement, the following words and phrases shall have the following
meanings:



     “Account” shall mean each Initial Account and, from and after the related Addition
Date, each Additional Account. The term “Account” shall not apply to any Removed Accounts
reassigned or assigned to the Transferor or the Servicer in accordance with the terms of the Trust
Sale and Servicing Agreement.



     “Accumulation Period” shall mean, with respect to any Series of Notes, the period
specified in the related Series Supplement, if any.



     “Act” shall mean an Act as specified in Section 11.3(a) of the Indenture.



     “Addition Date” shall mean, with respect to Additional Accounts, the date from and
after which such Additional Accounts are to be included as Accounts pursuant to Section 2.5
of the Trust Sale and Servicing Agreement.



     “Addition Notice” shall have the meaning specified in Section 2.5(a) of the
Trust Sale and Servicing Agreement.



     “Additional Accounts” shall mean each individual wholesale financing account
established with a Dealer pursuant to a Floorplan Financing Agreement, which account is designated
pursuant to Section 2.5 of the Trust Sale and Servicing Agreement to be included as an
Account designated to the Trust and is identified in the computer file or microfiche or written
list (which may be in electronic form) delivered to the Owner Trustee by the Transferor pursuant to
Sections 2.1 and 2.5(a)(ii) of the Trust Sale and Servicing Agreement.



     “Additional Cut-Off Date” shall mean, with respect to Additional Accounts, the day
specified in the Addition Notice delivered with respect to such Additional Accounts pursuant to
Section 2.5(a) of the Trust Sale and Servicing Agreement.



     “Adjustment Payment” shall have the meaning specified in Section 3.9(a) of the
Trust Sale and Servicing Agreement.



     “Administration Agreement” shall mean that certain Amended and Restated Administration
Agreement, dated as of August 11, 2005, among VCI, as Administrator, the Issuer and the Indenture
Trustee, as amended and supplemented from time to time.



     “Administrator” shall mean VCI or any successor Administrator under the Administration
Agreement.



Amended and Restated

Trust Sale and Servicing Agreement






 









 








     “Advance Date” shall have the meaning, if any, specified in the related Series
Supplement.



     “Affiliate” shall mean, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person. For the purposes
of this definition, “control” when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative to the foregoing.



     “Agency Office” shall mean the office of the Issuer maintained pursuant to Section
3.2 of the Indenture.



     “Agent” shall mean, with respect to any Series, the Person so designated in the
related Series Supplement.



     “Amortization Period” shall have, with respect to any Series, the meaning specified in
the related Series Supplement.



     “Assignment” shall have the meaning specified in Section 2.5(a)(ii) of the
Trust Sale and Servicing Agreement.



     “Authorized Officer” means (a) with respect to the Issuer, (i) any officer of the
Owner Trustee who is authorized to act for the Owner Trustee in matters relating to the Issuer and
who is identified on the list of Authorized Officers delivered by the Owner Trustee to the
Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to
time thereafter) and (ii) so long as the Administration Agreement is in effect, any officer of the
Administrator who is authorized to act for the Administrator in matters relating to the Issuer
pursuant to the Administration Agreement and who is identified on the list of Authorized Officers
delivered by the Administrator to the Owner Trustee and the Indenture Trustee on the Closing Date
(as such list may be modified or supplemented from time to time thereafter) and (b) with respect to
the Owner Trustee, the Indenture Trustee and the Servicer, any officer of the Owner Trustee, the
Indenture Trustee or the Servicer, as applicable, who is authorized to act for the Owner Trustee,
the Indenture Trustee or the Servicer, as applicable, in matters relating to the Owner Trustee, the
Indenture Trustee or the Servicer and who is identified on the list of Authorized Officers
delivered by each of the Owner Trustee, the Indenture Trustee and the Servicer to the Indenture
Trustee on the Closing Date (as such list may be modified or supplemented from time to time
thereafter).



     “Automatic Additional Accounts” shall have the meaning specified in Section
2.5(b) of the Trust Sale and Servicing Agreement.



     “Available Subordinated Amount” shall mean, with respect to any Series at any time of
determination, an amount equal to the available subordinated amount specified in the related Series
Supplement at such time.



     “Bankruptcy Event” means, for any Person, that such Person makes a general assignment
for the benefit of creditors or any proceeding is instituted by or against such Person seeking to



41









 




adjudicate it bankrupt or insolvent, or seeking the liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the entry of
an order for relief or the appointment of a receiver, trustee or other similar official for it or
any substantial part of its property and, in the case of any proceeding instituted against such
Person, such proceeding remains unstayed for more than 90 days.




     “Bankruptcy Remote Party” means each of the Transferor and the Issuer.



     “Basic Documents” shall mean the Trust Agreement, the Receivables Purchase Agreement,
the Trust Sale and Servicing Agreement, the Omnibus Agreement, each Depository Agreement, the
Administration Agreement, the Indenture (including all Series Supplements), the Enhancement
Agreements and the other documents and certificates delivered in connection therewith from time to
time.



     “Beneficiary” shall mean any of the Holders of the Notes and any Enhancement Provider.



     “Benefit Plan” shall mean any one of (a) an employee benefit plan (as described in
Section 3(3) of ERISA) that is subject to the provisions of Title I of ERISA, (b) a plan described
in Section 4975(e)(1) of the Code or (c) any entity whose underlying assets include plan assets by
reason of a plan’s investment in such entity.



     “Book-Entry Note” shall mean Notes in which ownership and transfers shall be made
through book entries by a Clearing Agency as described in Section 2.10 of the Indenture.



     “Business Day” shall mean any day other than (a) a Saturday or a Sunday or (b) another
day on which banking institutions or trust companies in the State of Michigan, the State of New
York or the State of Illinois are authorized or obligated by law, executive order or governmental
decree to be closed.



     “Cash Management Accounts” shall mean the deposit accounts maintained by VCI for the
benefit of Dealers.



     “Class” shall mean, with respect to any Series, any one of the Classes of Notes of
that Series.



     “Clearing Agency” shall mean an organization registered as a “clearing agency”
pursuant to Section 17A of the Exchange Act. The Clearing Agency for the Notes shall be The
Depository Trust Company.



     “Clearing Agency Participant” shall mean a securities broker, dealer, bank, trust
company, clearing corporation or 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.



     “Clearstream” shall mean Clearstream Banking, société anonyme.



42









 





     “Closing Date” shall mean, with respect to any Series, the Closing Date specified in
the related Series Supplement, including the Initial Closing Date.



     “Code” shall mean the Internal Revenue Code of 1986 as amended, and the Treasury
Regulations promulgated thereunder.



     “Collateral” shall mean the collateral specified in the granting clause of the
Indenture.



     “Collateral Security” shall mean, with respect to any Receivable and subject to the
terms of the Receivables Purchase Agreement, (i) the security interest granted by or on behalf of
the related Dealer granted to secure payment of such Receivable, including a security interest in
the related Vehicle, specified parts inventory, equipment, fixtures, service accounts of the
Dealers and, in some cases, realty securing payment the Receivable and/or (ii) personal guarantees
securing such Receivable.



     “Collection Account” shall have the meaning specified in Section 4.1(a) of the
Trust Sale and Servicing Agreement.



     “Collection Period” shall mean, with respect to any Payment Date, the calendar month
preceding the month in which such Payment Date occurs.



     “Collections” shall mean, without duplication, all payments by or on behalf of Dealers
in respect of the Receivables, in the form of cash, checks, wire transfers or any other form of
payment; and shall include, without duplication, (i) the amount of any Rebate Payments deposited by
the Servicer into the Collection Account (such amounts being deemed Non-Principal Collections), and
(ii) all other Non-Principal Collections and Principal Collections.



     “Common Collateral” shall have the meaning specified in Article VII of the
Receivables Purchase Agreement.



     “Common Non-Vehicle Collateral” shall have the meaning specified in Article VII of the
Receivables Purchase Agreement.



     “Common Vehicle Collateral” shall have the meaning specified in Article VII of the
Receivables Purchase Agreement.



     “Controlled Amortization Period” shall mean, with respect to any Series of Notes, the
period specified in the related Series Supplement, if any.



     “Controlling Class” shall mean, with respect to a Series of Notes, (a) if there is
only one class of Notes in that Series, all Notes of that Series and (b) if there is more than one
class of Notes in that Series, the class or classes with the highest rating.



     “Conveyed Receivables” shall have the meaning specified in Section 2.1 of the
Trust Sale and Servicing Agreement.



     “Corporate Trust Office” shall mean with respect to the Indenture Trustee or the Owner
Trustee, the office at which at any particular time the corporate trust business of the Indenture



43









 




Trustee or Owner Trustee, respectively, shall be administered, which offices at the Initial
Closing Date are located:




     in the case of the Indenture Trustee, at:


JPMorgan Chase Bank, N.A.

4 New York Plaza, 6th Floor

New York, New York 10004

Attention: Global Corporate Trust Services




     and in the case of the Owner Trustee, at:


The Bank of New York (Delaware), Owner Trustee

c/o The Bank of New York

101 Barclay Street

New York, New York 10286

Attention: Asset Backed Securities Department




     “Customary Servicing Practices” means the customary servicing practices of the
Servicer with respect to Receivables, as such practices may be amended from time to time.



     “Cut-Off Date” shall mean the Initial Cut-Off Date and any Additional Cut-Off Date, as
applicable.



     “Date of Processing” shall mean, with respect to any transaction, the date on which
such transaction is first recorded on the Servicer’s computer file of accounts (without regard to
the effective date of such recordation).



     “Dealer” shall mean a Person engaged generally in the business of purchasing Vehicles
from a manufacturer or distributor thereof and holding such Vehicles for sale or lease in the
ordinary course of business, and which has an Account the Receivables of which have been
transferred to the Trust.



     “Dealer Groups” means any Dealer or group of affiliated Dealers (as determined in
accordance with the Servicer’s standard procedures for identifying and tracking Accounts of
affiliated Dealers).



     “Dealer Overconcentration” shall mean on any Determination Date, with respect to the
following Dealer or Dealer Groups, the sum of the following:



     (a) the amount by which the aggregate balance of Principal Receivables due from AutoNation,
Inc. and its affiliates, less any amounts on deposit in the Cash Management Account relating to
such Receivables, exceeds 4% of the Pool Balance (excluding the amount on deposit in the Excess
Funding Account, if any), in each case, on the last day of the Collection Period immediately
preceding such Determination Date;



     (b) the amount by which the aggregate balance of Principal Receivables, less any amounts on
deposit in the Cash Management Account relating to such Receivables, due from the



44









 




largest Dealer or Dealer Group (excluding AutoNation, Inc. and its affiliates) exceeds 4% of
the Pool Balance (excluding the amount on deposit in the Excess Funding Account, if any), in each
case, on the last day of the Collection Period immediately preceding such Determination Date;




     (c) the amount by which the aggregate balance of Principal Receivables, less any amounts on
deposit in the Cash Management Account relating to such Receivables, due from each of the next
three largest Dealers or Dealer Groups (excluding AutoNation, Inc. and its affiliates) exceeds 3%
of the Pool Balance (excluding the amount on deposit in the Excess Funding Account, if any), in
each case, on the last day of the Collection Period immediately preceding such Determination Date;
and



     (d) the amount by which the aggregate balance of Principal Receivables, less any amounts on
deposit in the Cash Management Account relating to such Receivables, due from the other Dealer or
Dealer Group exceeds 2% of the Pool Balance (excluding the amount on deposit in the Excess Funding
Account, if any), in each case, on the last day of the Collection Period immediately preceding such
Determination Date.



     “Defaulted Account” shall mean an Account in which there are Defaulted Receivables.



     “Defaulted Amount” for any Collection Period shall mean an amount (which shall not be
less than zero) equal to the excess, if any, of:




     (a) the Principal Receivables that became Defaulted Receivables during the preceding
Collection Period




     over




     (b) the full amount of any Defaulted Receivables subject to reassignment to the
Transferor or purchase by the Servicer for such Collection Period unless an
Insolvency Event occurs for either of the Transferor or the Servicer, in which event
the Defaulted Amount will not be reduced for those Defaulted Receivables.



     “Defaulted Receivables” shall mean, on any Determination Date, (a) all Receivables
which were charged off as uncollectible in respect of the immediately preceding Collection Period
in accordance with the Servicer’s customary and usual servicing procedures for servicing Dealer
floorplan receivables comparable to the Receivables which have not been sold to third parties and
(b) all Receivables which were Eligible Receivables when transferred to the Trust on the Initial
Closing Date or the related Addition Date or on their respective Transfer Date, which arose in an
Account that thereafter became an Ineligible Account and which remained outstanding for any six
consecutive Determination Dates (inclusive of the Determination Date on which such determination is
being made) after such Account became an Ineligible Account.



     “Definitive Notes” shall mean the Notes issued pursuant to the Indenture in definitive
form either upon original issuance or upon termination of book-entry registration with respect to
such Notes pursuant to Section 2.12 of the Indenture.



45









 





     “Deposit Date” shall mean each day on which the Servicer deposits Collections in the
Collection Account pursuant to Section 4.2 of the Trust Sale and Servicing Agreement.



     “Depository” shall mean The Depository Trust Company, as initial Depository, the
nominee of which is CEDE & Co., or any other organization registered as a “clearing agency”
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended. The Depository shall
at all times be a “clearing corporation” as defined in Section 8-102 of the Uniform Commercial Code
of the State of New York.



     “Depository Agreement” shall mean, with respect to any Series or Class, the agreement
between the Trust and the initial Depository, dated as of the related Closing Date.



     “Depository Participant” shall mean a broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects book-entry transfers
and pledges of securities deposited with the Depository.



     “Designated Accounts” shall have the meaning specified in Section 2.7(b)(i) of
the Trust Sale and Servicing Agreement.



     “Designated Balance” shall have the meaning specified in Section 2.7(b)(ii) of
the Trust Sale and Servicing Agreement.



     “Determination Date” shall mean, with respect to any Payment Date, the day that is two
Business Days prior to such date.



     “Early Amortization Event” shall have the meaning specified in Section 5.17 of
the Indenture and, with respect to any Series or class, shall also mean any Early Amortization
Event specified in the related Series Supplement.



     “Early Amortization Period” shall mean with respect to any Series, the period
specified as such in the related Series Supplement.



     “Eligible Account” shall mean each individual wholesale financing revolving line of
credit extended by VCI to a Dealer pursuant to a Floorplan Financing Agreement, which, as of the
date of determination with respect thereto: (a) is established by VCI in the ordinary course of
business pursuant to a Dealer financing agreement, (b) is in favor of a Dealer which is an
Eligible Dealer, (c) is in existence and maintained and serviced by VCI (or a Successor Servicer)
and (d) is an Account in respect of which no amounts have been charged off as uncollectible or are
classified as past due or delinquent.



     “Eligible Dealer” shall mean a Dealer, as of the date of determination thereof, (a)
which is located in the United States of America (including its territories and possessions), (b)
which has not been identified by the Servicer as being the subject of any voluntary or involuntary
bankruptcy proceeding or voluntary or involuntary liquidation, (c) in which VWOA or its affiliates
do not have an equity investment, and (d) which is not in “dealer default” as determined by the
Servicer under Floorplan Financing Guidelines.



46









 





     “Eligible Deposit Account” shall mean either (a) a segregated account with an Eligible
Institution, or (b) a segregated trust account with the corporate trust department of a depository
institution organized under the laws of the United States of America or any one of the states
thereof, including the District of Columbia (or any domestic branch of a foreign bank), having
corporate trust powers and acting as trustee for funds deposited in such account, so long as any of
the securities of such depository institution shall have a credit rating from each Rating Agency in
one of its generic rating categories which signifies investment grade.



     “Eligible Institution” shall mean (a) the corporate trust department of the Indenture
Trustee, or (b) a depository institution or trust company organized under the laws of the United
States of America or any one of the states thereof, or the District of Columbia (or any domestic
branch of a foreign bank), which at all times (i) has either (A) a long-term unsecured debt rating
of Aa2 or better by Moody’s and of AA- or better by Standard & Poor’s or such other rating that is
acceptable to each Rating Agency, as evidenced by a letter from such Rating Agency to the Indenture
Trustee or (B) a certificate of deposit rating of P-1 by Moody’s and A-1+ by Standard & Poor’s or
such other rating that is acceptable to each Rating Agency, as evidenced by a letter from such
Rating Agency to the Indenture Trustee and (ii) is a member of the FDIC.



     “Eligible Investments” shall mean book-entry securities, negotiable instruments or
securities represented by instruments in bearer or registered form generally having original or
remaining maturities of 30 days or less, but in no event occurring later than the Payment Date next
occurring after the Indenture Trustee acquires the investments, which evidence:




     (a) direct obligations of, and obligations fully guaranteed as to timely payment by,
the United States of America;




     (b) demand deposits, time deposits or certificates of deposit of any depositary
institution or trust company incorporated under the laws of the United States of America or
any state thereof, or the District of Columbia (or any domestic branch of a foreign bank),
and subject to supervision and examination by Federal or state banking or depository
institution authorities; provided, however, that at the time of the Trust’s
investment or contractual commitment to invest in the investments, the commercial paper or
other short-term unsecured debt obligations (other than obligations the rating of which is
based on the credit of a person or entity other than the depository institution or trust
company) of the depository institution or trust company must have a credit rating from each
of the Rating Agencies in the highest investment category granted by the Rating Agencies;




     (c) commercial paper having, at the time of the Trust’s investments or contractual
commitment to invest in the investments, a rating from each of the Rating Agencies in the
highest investment category granted by the Rating Agencies;




     (d) investments in money market funds having a rating from each of the Rating Agencies
in the highest investment category granted by the Rating Agencies or otherwise approved in
writing by the Rating Agencies;



47









 






     (e) bankers’ acceptances issued by any depository institution or trust company referred
to in clause (b) above;




     (f) repurchase obligations with respect to any security that is a direct obligation of,
or fully guaranteed by, the United States of America or any agency or instrumentality
thereof the obligations of which are backed by the full faith and credit of the United
States of America, in either case entered into with a depository institution or trust
company (acting as a principal) described in clause (b) above; and


any other investment consisting of a financial asset that by its terms converts into cash within a
finite period of time, if each Rating Agency shall have notified the Transferor, the Servicer, the
Indenture Trustee and the Owner Trustee that the Trust’s investment in the investment will not
result in a reduction or withdrawal of the rating of any outstanding Class or Series rated by the
Rating Agency.




     “Eligible Receivable” shall mean each Receivable:




     (a) which was originated or acquired by VCI or an Affiliate of VCI in the ordinary
course of business;




     (b) which arose under an Account that at the time was an Eligible Account;




     (c) which is owned by VCI at the time of sale by VCI to the Transferor;




     (d) which represents the obligation of a Dealer to repay an advance made to or on
behalf of such Dealer to finance the acquisition of Vehicles;




     (e) which at the time of creation and at the time of transfer to the Trust (except at
the Initial Closing Date in the case of Receivables in respect of which the related financed
Vehicle has been sold), is secured by, inter alia, a first priority perfected security
interest in the Vehicle relating thereto;




     (f) which was created in compliance in all respects with all Requirements of Law
applicable thereto and pursuant to a Floorplan Financing Agreement which complies in all
respects with all Requirements of Law applicable to any party thereto;




     (g) with respect to which all material consents, licenses, approvals or authorizations
of, or registrations or declarations with, any Governmental Authority required to be
obtained, effected or given by VCI or the Transferor in connection with the creation of such
Receivable or the transfer thereof to the Trust or the execution, delivery and performance
of the related Floorplan Financing Agreement pursuant to which such Receivable was created,
have been duly obtained, effected or given and are in full force and effect;




     (h) as to which at all times following the transfer of such Receivable to the Trust,
the Trust will have good and marketable title thereto free and clear of all Liens arising
prior to the transfer or arising at any time other than Liens permitted by the Trust Sale
and Security Agreement;



48









 






     (i) which has been the subject of a valid transfer and assignment from the Transferor
to the Trust of all the Transferor’s right, title and interest therein (including any
proceeds thereof);




     (j) which will at all times be the legal, valid, binding and assignable payment
obligation of the Dealer relating thereto, enforceable against such Dealer in accordance
with its terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws, now or hereafter in effect,
affecting the enforcement of creditors’ rights in general and except as such enforceability
may be limited by general principles of equity (whether considered in a suit at law or in
equity);




     (k) which at the time of transfer to the Trust is not subject to any right of
rescission, setoff, counterclaim or any other defense (including defenses arising out of
violations of usury laws) of the Dealer;




     (l) as to which, at the time of transfer of such Receivable to the Trust, VCI and the
Transferor were not in breach of any of their respective obligations with respect to such
Receivable required to be satisfied at such time;




     (m) as to which, at the time of transfer of such Receivable to the Trust, neither VCI
nor the Transferor has taken or failed to take any action which would impair the rights of
the Trust or the Noteholders therein;




     (n) which constitutes an “instrument”, “account”, “chattel paper” or “general
intangible” as defined in Article 9 of the UCC as then in effect; and




     (o) which was transferred to the Trust with all applicable governmental authorization;
and




     (p) which is payable in U.S. dollars.



     “Eligible Servicer” shall mean the Trustee, VCI or an entity which, at the time of its
appointment as Servicer, (a) is legally qualified and has the capacity to service the Accounts, (b)
in the sole determination of the Indenture Trustee, which determination shall be conclusive and
binding, has demonstrated the ability to professionally and competently service a portfolio of
similar accounts in accordance with high standards of skill and care and (c) is qualified to use
the software that is then currently being used to service the Accounts or obtains the right to use
or has its own software which is adequate to perform its duties under this Agreement.



     “Enhancement” shall mean the rights and benefits provided to the Noteholders of any
Series or class pursuant to any letter of credit, surety bond, cash collateral account, reserve
account, yield supplement account, spread account, guaranteed rate agreement, maturity liquidity
facility, tax protection agreement, interest rate swap agreement or other arrangement issued for a
Series or Class. The subordination of any Series or class to any other Series or class or of a
portion of the Residual Interest to any Series or class shall be deemed to be an Enhancement.



49









 





     “Enhancement Agreement” shall mean any agreement, instrument or document governing the
terms of any Enhancement or pursuant to which any Enhancement is issued or outstanding.



     “Enhancement Provider” shall mean the Person providing any Enhancement, other than the
Residual Interestholder whose Residual Interest (or any portion thereof) is subordinated to any
Series or class of Notes.



     “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.



     “Event of Default” shall mean an event described in Section 5.1 of the
Indenture.



     “Excess Funding Account” shall mean the account designated as such, established and
maintained pursuant to Section 4.1(c) of the Trust Sale and Servicing Agreement.



     “Excess Non-Principal Collections” shall mean, for any Collection Period, the amount
of Non-Principal Collections allocable to each Series remaining after all payments or deposits
required under the related Series Supplement have been made for the related Payment Date.



     “Excess Principal Collections” shall mean, for any Collection Period, the amount of
Principal Collections allocable to each Series remaining after all required payments of principal
have been made for the related Payment Date to the Principal Funding Account for such Series or to
the Noteholders of such Series or a Class of such Series.



     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.



     “Excluded Series” shall mean any Series of Notes so designated in the applicable
Series Supplement, if any.



     “Executive Officer” shall mean, with respect to any entity, the Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer, President, Executive Vice President, any
Vice President, the Secretary, the Treasurer, Assistant Secretary, Assistant Treasurer or
comparable officer of such entity; and with respect to any partnership, any general partner
thereof.



     “FDIC” shall mean the Federal Deposit Insurance Corporation or any successor entity
thereto.



     “Final Maturity Date” shall mean, with respect to any Series of Notes, the date
specified in any Series Supplement.



     “Financing” means, collectively, (i) any financing transaction of any sort undertaken
by VCI or any Affiliate of VCI involving, directly or indirectly, the Trust Assets, and (ii) any
other asset securitization, secured loan or similar transaction involving the Trust Assets or any
beneficial interest therein or in the Trust.



     “Floorplan Financing Agreement” shall mean, collectively, the group of related
agreements between VCI and the Dealer with respect thereto, pursuant to which (a) VCI agrees



50









 




to extend credit to such Dealer to finance used Vehicles and new Vehicles manufactured by one
of the manufacturers, (b) such Dealer grants to VCI a security interest in the specific Vehicles
financed by VCI, certain other Vehicles, certain other collateral and the proceeds thereof, (c)
such Dealer agrees to repay advances made by VCI on demand, and (d) the obligations of such Dealer
to repay such advances is evidenced by one or more promissory notes of such Dealer.




     “Floorplan Financing Guidelines” shall mean the written policies and procedures of
VCI, as such policies and procedures may be amended from time to time, (a) relating to the
operation of a floorplan financing business, including the written policies and procedures for
determining the interest rate charged to Dealers, the other terms and conditions relating to VCI’s
wholesale financing accounts, the creditworthiness of Dealers and the extension of credit to
Dealers, and (b) relating to the maintenance of accounts and collection of receivables.



     “GAAP” shall mean generally accepted accounting principles in the United States.



     “Governmental Authority” shall mean the United States of America, any state or other
political subdivision, and any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.



     “Holder” shall mean the Person in whose name a Note is registered on the Note
Register.



     “Incremental Subordinated Amount” shall mean, with respect to any Series at any time
of determination, an amount equal to the incremental subordinated amount specified in the related
Series Supplement.



     “Indenture” shall mean the Amended and Restated Indenture agreement between the Trust
and the Indenture Trustee, dated as of August 11, 2005, as the same may from time to time be
amended, modified or otherwise supplemented.



     “Indenture Trustee” shall mean JPMorgan Chase Bank, N.A., a national banking
association, not in its individual capacity but solely as trustee under the Indenture, or any
successor trustee under the Indenture.



     “Independent” shall mean, 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 Transferor
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 Transferor
or any Affiliate of any of the foregoing Persons and (c) is not connected with the Issuer, any such
other obligor, the Transferor or any Affiliate of any of the foregoing Persons as an officer,
employee, promoter, underwriter, trustee, partner, director or person performing similar functions.



     “Independent Certificate” shall mean a certificate or opinion to be delivered to the
Indenture Trustee under the circumstances described in, and otherwise complying with, the
applicable requirements of Section 11.1 of the Indenture, made by an Independent appraiser
or other expert appointed by an Issuer Order and approved by the Indenture Trustee in the exercise
of reasonable care, and such opinion or certificate shall state that the signer has read the
definition of “Independent” and that the signer is Independent within the meaning thereof.



51









 





     “Ineligible Account” shall mean an Account that at the time of determination is not an
Eligible Account.



     “Ineligible Amount” shall mean on any Determination Date, the amount of Ineligible
Receivables included in the Trust on the last day of the preceding Collection Period pursuant to
Section 2.9 of the Trust Sale and Servicing Agreement.



     “Ineligible Receivables” shall mean all Receivables that at the time of determination
are not Eligible Receivables that arise in Eligible Accounts.



     “Initial Account” shall mean each individual wholesale financing account established
with a Dealer pursuant to a Floorplan Financing Agreement which is identified in the computer file
or microfiche or written list (which may be in electronic form) delivered to the Owner Trustee on
the Initial Closing Date by the Transferor pursuant to Section 2.1 of the Trust Sale and
Servicing Agreement.



     “Initial Closing Date” shall mean August 10, 2000.



     “Initial Cut-Off Date” shall mean June 30, 2000.



     “Initial Invested Amount” shall mean, with respect to any Series and for any date, an
amount equal to the initial invested amount specified in the related Series Supplement. The
Initial Invested Amount for any Series may be increased or decreased from time to time as specified
in the related Series Supplement.



     “Insolvency Event” shall mean any event specified in Section 5.17(b) or
(c) of the Indenture.



     “Insolvency Laws” shall mean the Bankruptcy Code and any other applicable federal or
State bankruptcy, insolvency or other similar law.



     “Insurance Proceeds” shall mean, with respect to an Account, any amounts received by
the Servicer pursuant to any policy of insurance which is required to be paid to VCI pursuant to a
Floorplan Financing Agreement.



     “Internal Revenue Code” shall mean, the Internal Revenue Code of 1986, as amended.



     “Invested Amount” shall mean, with respect to any Series and for any date, an amount
equal to the invested amount specified in the related Series Supplement. The Invested Amount for
any Series may be increased or decreased from time to time as specified in the related Series
Supplement.



     “Investment Company Act” shall mean the Investment Company Act of 1940, as amended.



     “Involuntary Case” shall have the meaning specified in Article VI of the Receivables
Purchase Agreement.



52









 





     “Issuer” shall mean the party named as such in the Indenture until a successor
replaces it and, thereafter, the successor and, for purposes of any provision contained herein and
required by the TIA, each other obligor on the Notes.



     “Issuer Order” and “Issuer Request” shall mean a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and delivered to the
Indenture Trustee.



     “Lien” shall mean any mortgage, deed of trust, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), preference, participation interest,
priority or other security agreement or preferential arrangement of any kind or nature whatsoever,
including any conditional sale or other title retention agreement and any financing lease having
substantially the same economic effect as any of the foregoing.



     “Miscellaneous Payments” shall mean, with respect to any Collection Period, the sum of
(a) Adjustment Payments and Transfer Deposit Amounts on deposit in the Collection Account on the
related Payment Date and (b) Unallocated Principal Collections available to be treated as
Miscellaneous Payments pursuant to Section 4.3 on such Payment Date.



     “Monthly Servicing Fee” shall mean, with respect to any, Series the amount specified
therefor in the related Series Supplement.



     “Moody’s” shall mean Moody’s Investors Service, Inc., or its successor.



     “Nonfloorplan Agreement” shall have the meaning specified in Article VII of the
Receivables Purchase Agreement.



     “Non-Principal Collections” shall mean all Collections of interest, including amounts
recovered on Defaulted Receivables, insurance proceeds and Rebate Payments, under the Receivables.



     “Non-Principal Receivables” with respect to any Account shall mean all amounts billed
to the related Dealer in respect of interest and all other non-principal charges, including service
fees and handling fees.



     “Non-Principal Shortfalls” means, for any Collection Period, with respect to any
Series of Notes the amounts specified in the related Series Supplement, if any.



     “Note” shall mean any asset-backed Note executed by the Issuer by any of its
Authorized Officers and authenticated by the Indenture Trustee in the form attached to the Series
Supplement applicable to such Series of Notes.



     “Note Depository” shall mean with respect to any Book-Entry Notes for which Definitive
Notes have not been issued, any depository selected from time to time by the Indenture Trustee on
behalf of the Trust in whose name a Series of Notes is registered. The Note Depository shall be
Cede & Co., the nominee of the Clearing Agency for such Series.



     “Note Depository Agreement” shall mean with respect to any Series of Notes originally
issued as Book-Entry Notes, the agreement, dated as of the Closing Date for such Series, among



53









 




the Issuer, the Indenture Trustee and the Clearing Agency relating to such Notes, as the same
may be amended and supplemented from time to time.




     “Note Distribution Account” shall mean the account designated as such, established and
maintained pursuant to Section 4.1(b) of the Trust Sale and Servicing Agreement.



     “Note Owner” shall mean, with respect to a Book-Entry Note, any person who is a
beneficial owner of a Book-Entry Note.



     “Note Rate” shall mean, with respect to any Series or Class, the note rate specified
therefor in the related Series Supplement.



     “Note Register” shall have the meaning specified in Section 2.4(a) of the
Indenture.



     “Note Registrar” shall mean the registrar at any time of the Note Register, appointed
pursuant to Section 2.4 of the Indenture.



     “Noteholder” shall mean any Holder of a Note.



     “Noteholders’ Monthly Servicing Fee” shall mean the portion of the Servicing Fee
allocable to the Noteholders pursuant to the terms of a Series Supplement.



     “Notice Date” shall have the meaning specified in Section 2.5(a) of the Trust
Sale and Servicing Agreement.



     “Notice of Default” shall have the meaning set forth in Section 5.1(d) of the
Indenture.



     “Officers’ Certificate” shall mean a certificate signed by an Authorized Officer of
the Person delivering such certificate.



     “Omnibus Agreement” means the Omnibus Agreement dated as of the Closing Date among the
Servicer, Administrator, Transferor, Indenture Trustee and the Trust.



     “Opinion of Counsel” shall mean a written opinion of counsel, who may, except as
otherwise expressly provided, be an employee of the Transferor, the Servicer or VCI. In addition,
for purposes of the Indenture: (a) such counsel shall be satisfactory to the Indenture Trustee,
(b) the opinion shall be addressed to the Indenture Trustee as Indenture Trustee and (c) the
opinion shall comply with any applicable requirements of Section 11.1(a) of the Indenture
and shall be in form and substance satisfactory to the Indenture Trustee.



     “Order” shall have the meaning specified in Article VI of the Receivables
Purchase Agreement.



     “Out of Trust Account” means any Account as to which: (a) the Dealer has either (i)
received proceeds from the sale of the related Vehicle or (ii) no longer owns, controls or has
title to the Vehicle; and (b) the Dealer has not paid or is unable to pay the full the amount of
the related Receivable to VCI, as Servicer, within three Business Days after VCI has made a demand
for payment.



54









 





     “Outstanding” shall mean, with respect to any Notes, as of any Determination Date, all
such Notes theretofore authenticated and delivered under the Indenture except:




     (a) Notes theretofore canceled by the Indenture Trustee or delivered to the Indenture
Trustee for cancellation;




     (b) Notes or portions thereof the payment for which money in the necessary amount has
been theretofore deposited with the Indenture Trustee or any 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 the Indenture or
provision therefore, satisfactory to the Indenture Trustee, has been made; and




     (c) 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 Indenture Trustee is
presented that any such Notes are held by a bona fide purchaser; provided,
however, 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 Transferor or any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that the Indenture Trustee
knows to be so owned 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
Indenture Trustee the pledgor’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 Transferor or any Affiliate
of any of the forgoing Persons.



     “Outstanding Amount” shall mean, as of any date, with respect to any Series of Notes,
the aggregate principal amount of such Notes Outstanding at such date.



     “Overconcentration Amount” on any Determination Date shall mean, without duplication,
the aggregate Principal Receivables in the Trust on such Determination Date that are Dealer
Overconcentrations.



     “Owner Trust Estate” shall mean all right, title and interest of the Trust in and to
the property and rights assigned to the Trust pursuant to Article II of the Trust Sale and
Servicing Agreement, all funds on deposit from time to time in the Trust Accounts and the Residual
Interest Distribution Account, the Enhancement Agreements and all other property of the Trust from
time to time, including any rights of the Owner Trustee and the Trust pursuant to the Trust Sale
and Servicing Agreement and the Administration Agreement.



     “Owner Trustee” shall mean The Bank of New York (Delaware), a Delaware banking
corporation, acting not in its individual capacity but solely as trustee or any successor trustee
under the Trust Agreement.



     “Pay Down Date” shall have the meaning, if any, specified in the related Series
Supplement.



55









 





     “Paying Agent” shall mean with respect to the Indenture, the Indenture Trustee or any
other Person that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11 of the Indenture 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. With respect to the Trust
Agreement, any paying agent or co-paying agent appointed pursuant to Section 3.3 of the
Trust Agreement that meets the eligibility standards for the Owner Trustee specified in Section
6.13 of the Trust Agreement.



     “Payment Date” shall mean the twentieth day of each month or, if such day is not a
Business Day, the next succeeding Business Day.



     “Payment Date Statement” shall mean, with respect to any Series, a report prepared by
the Servicer on each Determination Date for the immediately preceding Collection Period setting
forth the information contemplated by Section 3.4 of the Trust Sale and Servicing
Agreement.



     “Person” shall mean any legal person, including any individual, corporation,
partnership, limited liability company, association, joint-stock company, trust, unincorporated
organization, governmental entity or other entity of similar nature.



     “Pool Balance” shall mean, as of the time of determination thereof, the sum of (a) the
aggregate amount of Principal Receivables in the Trust at the time of determination, plus (b) the
amount on deposit in the Excess Funding Account, if any, at the time of determination.



     “Predecessor Note” shall mean 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 of
the Indenture in lieu of a mutilated, lost, destroyed or stolen Note.



     “Principal Collections” shall mean Collections of principal under the Receivables.



     “Principal Funding Account” shall mean, with respect to any Series of Notes, the
account so specified in the related Series Supplement.



     “Principal Receivables” with respect to an Account shall mean amounts shown on the
Servicer’s records as Receivables (other than such amounts which represent Non-Principal
Receivables) payable by the related Dealer. Notwithstanding anything to the contrary in the Trust
Sale and Servicing Agreement, the amount of Principal Receivables on any date of determination for
all purposes of the Basic Documents shall be deemed to be the actual amount thereof at such time
minus the aggregate amount on deposit in the Cash Management Accounts maintained for the benefit of
the related Dealers.



     “Principal Shortfalls” shall mean, for any Collection Period, with respect to any
Series of Notes the amounts specified in the related Series Supplement, if any.



     “Principal Terms” shall mean, with respect to any Series: (a) the name or
designation; (b) the initial principal amount (or method for calculating such amount); (c) the Note
Rate (or method for the determination thereof); (d) the payment date or dates and the date or dates
from



56









 




which interest shall accrue; (e) the method for allocating principal and interest to
Noteholders; (f) the designation of any Series Accounts and the terms governing the operation of
such Series Accounts; (g) the Monthly Servicing Fee and the Noteholders’ Monthly Servicing Fee; (h)
the issuer and terms of any form of Enhancement with respect thereto; (i) the terms on which the
Notes of such Series may be exchanged for Notes of another Series, repurchased by the Transferor or
remarketed to other investors; (j) the Termination Date or other final payment date; (k) the number
of Classes of Notes of such Series and, if more than one Class, the rights and priorities of each
such Class; (l) the extent to which the Notes of such Series will be issuable in temporary or
global form (and, in such case, the depository for such global note or notes, the terms or
conditions, if any, upon which such global note or notes may be exchanged, in whole or in part, for
Definitive Notes, and the manner in which any interest payable on a temporary or global note will
be paid); (m) whether the Notes of such Series may be issued in bearer form and any limitations
imposed thereon; (n) the priority of such Series with respect to any other Series; (o) whether such
Series will be part of a group, and (p) any other terms of such Series.




     “Proceeding” shall mean any suit in equity, action at law or other judicial or
administrative proceeding.



     “Purchase Price” shall mean, with respect to any Receivable for any date on which such
Receivable is to be purchased pursuant to Section 3.3(c) of this Agreement or Section
2.3(c) of the Receivables Purchase Agreement, as applicable, (a) an amount equal to the amount
payable by the Dealer in respect thereof as reflected in the records of the Servicer as of the date
of purchase plus, without duplication, (b) interest accrued from the end of the last
Collection Period until the day such Receivable is purchased in respect of which interest on such
Receivable was billed by the Servicer, at a per annum rate equal to the per annum rate borne by
such Receivable, based on the actual number of days elapsed over a year of 360 days.



     “Rated Securities” shall mean each class of Notes which has been rated by a Rating
Agency at the request of the Transferor.



     “Rating Agency” shall mean, with respect to any outstanding Series or Class, each
statistical rating agency selected by the Transferor to rate the Notes of such Series or Class,
unless otherwise specified in the Series Supplement.



     “Rating Agency Condition” means, with respect to any event and each Rating Agency,
either (a) written confirmation by such Rating Agency that the occurrence of such event will not
cause it to downgrade, qualify or withdraw its rating assigned to the Notes or (b) that such Rating
Agency shall have been given notice of such event at least ten (10) days prior to such event (or,
if (10) days’ advance notice is impracticable, as much advance notice as is practicable) and such
Rating Agency shall not have issued any written notice that the occurrence of such event will cause
it to downgrade, qualify or withdraw its rating assigned to the Notes. Notwithstanding the
foregoing, no Rating Agency has any duty to review any notice given with respect to any event, and
it is understood that such Rating Agency may not actually review notices received by it prior to or
after the expiration of the ten (10) day period described in (b) above. Further, each Rating
Agency retains the right to downgrade, qualify or withdraw its rating assigned to all or any of the
Notes at any time in its sole judgment even if the Rating Agency Condition with respect to an event
had been previously satisfied pursuant to clause (a) or clause (b) above.



57









 





     “Reassignment” shall have the meaning specified in Section 2.7(b) of the Trust
Sale and Servicing Agreement.



     “Rebate Payment” shall have the meaning specified in Section 3.9(c) of the
Trust Sale and Servicing Agreement.



     “Receivables” shall mean, with respect to an Account, all amounts shown on the
Servicer’s records as amounts payable by the related Dealer from time to time in respect of
advances made by VCI to such Dealer to finance the acquisition of Vehicles by such Dealer, together
with the group of writings evidencing such amounts and the security interest created in connection
therewith. Receivables which become Defaulted Receivables shall not be shown on the Servicer’s
records as amounts payable (and will cease to be included as Receivables) on the day on which they
become Defaulted Receivables. Receivables which VCI is unable to transfer to the Transferor
pursuant to the Receivables Purchase Agreement or which the Transferor is unable to transfer to the
Trust pursuant to the Trust Sale and Servicing Agreement and Receivables which arise in Designated
Accounts from and after the related Removal Commencement Date shall not be included in calculating
the amount of Receivables.



     “Receivables Purchase Agreement” shall mean the Amended and Restated Receivables
Purchase Agreement between VCI and the Transferor, dated as of August 11, 2005, governing the terms
and conditions upon which the Transferor acquired the initial Receivables transferred to the Trust
on the Initial Closing Date and all Receivables acquired thereafter, as the same may from time to
time be amended, modified or otherwise supplemented.



     “Record Date”, with respect to a Series, shall have the meaning specified in the
related Series Supplement.



     “Recoveries” on any Determination Date shall mean all amounts received, including
Insurance Proceeds, by the Servicer during the Collection Period immediately preceding such
Determination Date with respect to Receivables which have previously become Defaulted Receivables.



     “Redemption Date” The date specified as such by the Issuer as described in
Sections 10.1 and 10.2 of the Indenture.



     “Redemption Price” The price specified in the applicable Series Supplement.



     “Removal and Reassignment Date” shall have the meaning specified in Section
2.8(c)(i) of the Trust Sale and Servicing Agreement.



     “Removal Commencement Date” shall have the meaning specified in Section
2.7(b)(i) of the Trust Sale and Servicing Agreement.



     “Removal Date” shall have the meaning specified in Section 2.7(b)(iv) of the
Trust Sale and Servicing Agreement.



     “Removal Notice” shall have the meaning specified in Section 2.7(b)(i) of the
Trust Sale and Servicing Agreement.



58









 





     “Removed Account” shall have the meaning specified in Section 2.7(b) of the
Trust Sale and Servicing Agreement.



     “Removed Accounts and Receivables” shall have the meaning specified in Section
2.8(b) of the Trust Sale and Servicing Agreement.



     “Required Participation Amount” shall mean, at any time of determination, an amount
equal to the sum of (a) the sum of the amounts for each Series, of the product of the Required
Participation Percentage for each such Series by the Invested Amount for such Series at such time,
plus (b) the Trust Available Subordinated Amount on the immediately preceding Determination Date
(after giving effect to the allocations, distributions, withdrawals and deposits to be made on the
Payment Date following such Determination Date).



     “Required Participation Percentage” shall mean, with respect to any Series, the
percentage specified therefor in the related Series Supplement.



     “Required Rating” shall mean a rating on commercial paper or other short term
unsecured debt obligations of Prime-1 by Moody’s so long as Moody’s is a Rating Agency and A-1 by
Standard & Poor’s so long as Standard & Poor’s is a Rating Agency; and any requirement that
deposits or debt obligations have the “Required Rating” shall mean that such deposits or debt
obligations have the foregoing required ratings from Moody’s and Standard & Poor’s.



     “Requirements of Law” for any Person shall mean the certificate of incorporation and
by-laws or other organizational or governing documents of such Person, and any law, treaty, rule or
regulation, or determination of an arbitrator or Governmental Authority, in each case applicable to
or binding upon such Person or to which such Person is subject, whether federal, state or local
(including usury laws and the federal Truth in Lending Act).



     “Reserve Account” shall mean the account designated as such and established and
maintained pursuant to a Series Supplement.



     “Reset Date” shall mean the last day of a Collection Period.



     “Residual Interest” shall mean the beneficial undivided ownership interest in the
Trust.



     “Residual Interest Distribution Account” shall mean the account designated as such,
established and maintained pursuant to Section 5.1(a) of the Trust Agreement.



     “Residual Interestholder” shall mean the Transferor in its capacity as owner of the
Residual Interest.



     “Residual Participation Amount” shall mean, at any time of determination, an amount
equal to the excess, if any, of (i) the Pool Balance (excluding the amount on deposit in the Excess
Funding Account, if any) at the time of determination, over (ii) the aggregate Invested Amounts of
all Series then outstanding determined as specified in the applicable Series Supplement.



59









 





     “Responsible Officer” shall mean, with respect to the Indenture Trustee or the Owner
Trustee, any officer within the Corporate Trust Office (or any successor group of the Indenture
Trustee or Owner Trustee), including any managing director, vice president, assistant vice
president, secretary, assistant secretary, vice president or any other officer of the Indenture
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.



     “Revolving Period” shall mean with respect to any Series, the period specified as
such in the related Series Supplement.



     “Sarbanes-Oxley Act” means the Sarbanes-Oxley Act of 2002, as amended.



     “Securities Act” shall mean the Securities Act of 1933, as amended.



     “Series” shall mean any series of Notes so designated in the Series Supplement.



     “Series Account” shall mean any deposit, trust, escrow, reserve or similar account
maintained for the benefit of the Noteholders of any Series or class, as specified in any Series
Supplement.



     “Series Adjusted Invested Amount” shall mean, with respect to any outstanding Series
for any Collection Period, the sum of (a) the Series Invested Amount of the Notes of such Series
and (b) the Available Subordinated Amount, if any, for such Series on the Determination Date
occurring in such Collection Period (after giving effect to the allocations, distributions,
withdrawals and deposits to be made on the Payment Date following such Determination Date under the
applicable Series Supplement).



     “Series Cut-Off Date”, with respect to any Series, shall have the meaning specified in
the related Series Supplement.



     “Series Issuance Date” shall mean, with respect to any Series, the date on which the
Notes of such Series are to be originally issued in accordance with the Indenture and the related
Series Supplement.



     “Series Supplement” shall mean, with respect to any Series, a supplement to the
Indenture, executed and delivered in connection with the original issuance of the Notes of such
Series pursuant to Section 2.1 of the Indenture, and all amendments thereof and supplements
thereto.



     “Servicer” shall mean, initially, VCI, in its capacity as Servicer under the Trust
Sale and Servicing Agreement, and after any Servicing Transfer, the Successor Servicer.



     “Servicer Advance” shall mean, with respect to any Series, as specified in the related
Series Supplement.



60









 





     “Servicing Default” shall have the meaning specified in Section 7.1 of the
Trust Sale and Servicing Agreement.



     “Servicing Fee” shall have the meaning specified in Section 3.2 of the Trust
Sale and Servicing Agreement.



     “Servicing Fee Rate” shall be the rate set forth in the applicable Series Supplement.



     “Servicing Officer” shall mean any officer of the Servicer involved in, or responsible
for, the administration and servicing of the Receivables.



     “Servicing Transfer” shall have the meaning specified in Section 7.1 of the
Trust Sale and Servicing Agreement.



     “Standard & Poor’s” shall mean Standard & Poor’s Rating Services, a division of the
McGraw-Hill Companies, Inc. or its successor.



     “Successor Servicer” shall have the meaning specified in Section 7.2 of the
Trust Sale and Servicing Agreement.



     “Tax Opinion” shall mean, with respect to any action, an Opinion of Counsel to the
effect that, for U.S. federal income tax purposes (a) such action will not cause a taxable event
with respect to any Noteholders and (b) in the case of Section 2.14 of the Indenture, the
Notes of the new Series will be characterized as debt or an interest in a tax partnership (which
partnership will not be treated as a result of issuance of such Notes as a “publicly traded
partnership” within the meaning of Section 7704 of the Code and applicable Treasury Regulations).



     “Termination Date” shall mean, with respect to any Series, the date on which such
Series terminates under its Series Supplement, which shall be the termination date specified in
such Series Supplement.



     “Termination Notice” shall have the meaning specified in Section 7.1 of the
Trust Sale and Servicing Agreement.



     “Temporary Notes” shall mean the Notes specified in Section 2.3 of the
Indenture.



     “Transfer Date” shall have the meaning specified in Section 2.1 of the Trust
Sale and Servicing Agreement.



     “Transfer Deposit Amount” shall mean, with respect to any Receivable reassigned or
assigned to the Transferor or the Servicer, as applicable, pursuant to Section 2.4(c) or
Section 3.3(c) of this Agreement, the amounts specified in such Sections.



     “Transferor” shall mean Volkswagen Dealer Finance, LLC, a Delaware limited liability
company.



     “Treasury Regulations” means regulations, including proposed or temporary regulations,
promulgated under the Code from time to time.



61









 





     “Trust” shall mean the Volkswagen Credit Auto Master Owner Trust, a Delaware statutory
trust.



     “Trust Accounts” shall mean the Collection Account, the Note Distribution Account, the
Excess Funding Account, and any other account so designated in a Series Supplement, collectively.



     “Trust Adjusted Invested Amount” shall mean, at any time of determination, the sum of
the Series Adjusted Invested Amounts for all outstanding series at such time.



     “Trust Agreement” shall mean the amended and restated trust agreement between the
Transferor and the Owner Trustee, dated as August 11, 2005, as the same may from time to time be
amended, modified or otherwise supplemented.



     “Trust Assets” shall have the meaning specified in Section 2.1 of the Trust
Sale and Servicing Agreement.



     “Trust Available Subordinated Amount” shall mean, at any time of determination, the
sum of the Available Subordinated Amounts, if any, for all outstanding Series at such time.



     “Trust Estate” shall mean all money, instruments, rights and other property that are
subject or intended to be subject to the lien and security interest of the Indenture for the
benefit of the Noteholders and (only to the extent expressly provided in the Indenture) the
Residual Interestholder (including, without limitation, the Collateral described in the Granting
Clause of the Indenture), including the proceeds thereof, and any other property and interests that
are pledged to the Indenture Trustee for the benefit of Beneficiaries pursuant to a supplement to
the Trust Sale and Servicing Agreement or otherwise.



     “Trust Indenture Act” or “TIA” shall mean the Trust Indenture Act of 1939, as
amended.



     “Trust Required Participation Amount” shall mean, at any time of determination, an
amount equal to the sum of the Required Participation Amounts for all Series.



     “Trust Sale and Servicing Agreement” shall mean the Amended and Restated Trust Sale
and Servicing Agreement, dated as of August 11, 2005 between the Servicer, the Transferor and the
Trust, as amended and supplemented from time to time.



     “Trust Statute” means the Delaware Statutory Trust Act, 12 Del. C. §3801, et
seq.



     “Trust Termination Date” shall have the meaning specified in Section 7.1 of
the Trust Agreement.



     “UCC” shall mean, unless the context otherwise requires, the Uniform Commercial Code,
as amended from time to time, as in effect in the relevant jurisdiction, as amended from time to
time.



     “Unallocated Principal Collections” shall have the meaning specified in Section
4.3 of the Trust Sale and Servicing Agreement.



62









 





     “Unregistered Note” shall mean any Note that has not been registered under the
Securities Act and is subject to the provisions of Section 2.15 of the Indenture.



     “Used Vehicle” shall mean any Vehicle held for sale by a Dealer that is determined to
be a “used” Vehicle in accordance with the Servicer’s standard wholesale servicing practices.



     “VCI” shall mean VW Credit, Inc., a Delaware corporation, and its successors in
interest.



     “VDF” shall mean Volkswagen Dealer Finance, LLC, a Delaware limited liability company,
and its successors in interest.



     “VDF Subordinated Note” shall mean the Subordinated Note dated August 10, 2000 made by
the Transferor in favor of VCI.



     “Vehicle” shall mean an automobile or light-duty truck.



     “VWOA” shall mean Volkswagen of America, Inc., a New Jersey corporation.




63









 








APPENDIX A




PART II — RULES OF CONSTRUCTION




     (A) Accounting Terms. As used in this Appendix or the Basic Documents, accounting terms which
are not defined, and accounting terms partly defined, herein or therein shall have the respective
meanings given to them under generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Appendix or the Basic Documents are inconsistent with the
meanings of such terms under generally accepted accounting principles, the definitions contained in
this Appendix or the Basic Documents will control.



     (B) “Hereof,” etc. The words “hereof,” “herein” and “hereunder” and words of similar import
when used in this Appendix or any Basic Document will refer to this Appendix or such Basic Document
as a whole and not to any particular provision of this Appendix or such Basic Document; and
Section, Schedule and Exhibit references contained in this Appendix or any Basic Document are
references to Sections, Schedules and Exhibits in or to this Appendix or such Basic Document unless
otherwise specified. The word “or” is not exclusive.



     (C) Reference to Distribution Dates. With respect to any Distribution Date, the “related
Collection Period,” and the “related Record Date,” will mean the Collection Period and Record Date,
respectively, immediately preceding such Distribution Date, and the relationships among Collection
Periods and Record Dates will be correlative to the foregoing relationships.



     (D) Number and Gender. Each defined term used in this Appendix or the Basic Documents has a
comparable meaning when used in its plural or singular form. Each gender-specific term used in
this Appendix or the Basic Documents has a comparable meaning whether used in a masculine, feminine
or gender-neutral form.



     (E) Including. Whenever the term “including” (whether or not that term is followed by the
phrase “but not limited to” or “without limitation” or words of similar effect) is used in this
Appendix or the Basic Documents in connection with a listing of items within a particular
classification, that listing will be interpreted to be illustrative only and will not be
interpreted as a limitation on, or exclusive listing of, the items within that classification.



Amended and Restated

Trust Sale and Servicing Agreement





 









 








APPENDIX B




NOTICE ADDRESSES AND PROCEDURES




     All requests, demands, directions, consents, waivers, notices, authorizations and
communications provided or permitted under any Basic Document to be made upon, given or furnished
to or filed with the Transferor, the Servicer, the Administrator, the Indenture Trustee, the
Issuer, the Owner Trustee or the Rating Agencies shall be in writing, personally delivered, sent by
facsimile with a copy to follow via first class mail, overnight mail or mailed by certified
mail-return receipt requested, and shall be deemed to have been duly given upon receipt:



     (A) in the case of the Transferor, at the following address:


VOLKSWAGEN DEALER FINANCE, LLC

3800 Hamlin Road

Auburn Hills, Michigan 48326

Attn: Treasurer



     (B) in the case of the Servicer or the Administrator, at the following address:


VW Credit, Inc

3800 Hamlin Road

Auburn Hills, Michigan 48326

Attn: Treasurer



     (C) in the case of the Indenture Trustee, at its Corporate Trust Office,



     (D) in the case of the Issuer or the Owner Trustee, to the Owner Trustee at its Corporate
Trust Office,


The Bank of New York (Delaware)

c/o The Bank of New York

101 Barclay Street

New York, New York 10286

Attn: Asset Backed Securities Department


with a copy to:


VW Credit, Inc

3800 Hamlin Road

Auburn Hills, Michigan 48326

Attn: Treasurer


The Issuer shall promptly transmit any notice received by it from the Noteholders to the Indenture
Trustee and the Indenture Trustee shall likewise promptly transmit any notice received by it from
the Noteholders to the Issuer.




Amended and Restated

Trust Sale and Servicing Agreement





 









 








     (E) in the case of Moody’s Investors Service, Inc., to:


Moody’s Investors Service, Inc.

ABS Monitoring Department

99 Church Street

New York, New York 10007



     (F) in the case of Standard & Poor’s Ratings Services, to:


Standard & Poor’s Ratings Services

55 Water Street

New York, New York 10041

Attention: Asset Backed Surveillance Department



     or at such other address as shall be designated by such Person in a written notice to the
other parties to this Agreement.



     Where any Basic Document provides for notice to Noteholders of any condition or event, such
notice shall be sufficiently given (unless otherwise herein expressly provided) if it is in writing
and mailed, first-class, postage prepaid or by overnight mail to each Noteholder affected by such
condition or event, at such Person’s address as it appears on the Note Register not later than the
latest date, and not earlier than the earliest date, prescribed in such Basic Document for the
giving of such notice. If 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 Noteholders 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 regardless of whether
such notice is in fact actually received.




66









 








EXHIBIT A




FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS
(As required by Section 2.5(a)(ii) of the Trust Sale and Servicing Agreement).




     ASSIGNMENT No. ___OF RECEIVABLES IN ADDITIONAL ACCOUNTS dated as of _________, among
VOLKSWAGEN DEALER FINANCE, LLC (“VDF”), as transferor, VOLKSWAGEN CREDIT AUTO MASTER OWNER TRUST
(the “Trust”), as buyer, and VW CREDIT, INC., as servicer (the “Servicer”) pursuant to the Trust
Sale and Servicing Agreement referred to below.



W I T N E S S E T H :




     WHEREAS, the Servicer, VDF and the Trust are parties to an Amended and Restated Trust Sale and
Servicing Agreement dated as of August 11, 2005 (as amended or supplemented, the “Trust Sale and
Servicing Agreement”):



     WHEREAS, pursuant to the Trust Sale and Servicing Agreement, VDF wishes to designate
Additional Accounts to be included as Accounts and to convey the Receivables and Collateral
Security of such Additional Accounts, whether now existing or hereafter created, to the Trust as
part of the corpus of the Trust (as each such term is defined in the Trust Sale and Servicing
Agreement); and



     WHEREAS the Trust is willing to accept such designation and conveyance subject to the terms
and conditions hereof;



     NOW, THEREFORE, VDF, the Trust and the Servicer hereby agree as follows:



     1. Defined Terms. All capitalized terms used herein shall have the meanings ascribed
to them in Appendix A of the Trust Sale and Servicing Agreement unless otherwise defined herein.
“Addition Date” shall mean, with respect to the Additional Accounts designated hereby, _________ ,
______.



     2. Designation of Additional Accounts. VDF hereby delivers herewith a computer file or
microfiche or written list (which may be in electronic form) containing a true and complete list of
all such Additional Accounts specifying for each such Account, as of the Additional Cut-Off Date,
its account number, the aggregate amount of Receivables outstanding in such Account and the
aggregate amount of Principal Receivables in such Account. Such file or list shall, as of the date
of this Assignment, supplement Schedule 1 to the Trust Sale and Servicing Agreement.



     3. Conveyance of Receivables.



     (a) VDF does hereby sell, transfer, assign, set over and otherwise convey, without recourse
(except as expressly provided in the Trust Sale and Servicing Agreement), to the Trust for the
benefit of the Noteholders and the Residual Interestholder and any Enhancement



Amended and Restated

Trust Sale and Servicing Agreement




 









 







Providers, on the Addition Date all of its right, title and interest in, to and under the
Receivables in such Additional Accounts and all Collateral Security with respect thereto, owned by
VDF and existing at the close of business on the Additional Cut-Off Date and thereafter created
from time to time, all monies due or to become due and all amounts received with respect thereto
and all proceeds of all of the foregoing (including “proceeds” as defined in Section 9-102 of the
UCC) and Recoveries thereof. The foregoing sale, transfer, assignment, set-over and conveyance
does not constitute and is not intended to result in the creation or an assumption by the Trust,
the Owner Trustee, the Indenture Trustee, any Agent of any Beneficiary of any obligation of the
Servicer, VDF, VCI or any other Person in connection with the Accounts, the Receivables or under
any agreement or instrument relating thereto, including any obligation to any Dealers.



     (b) In connection with such sale, VDF agrees to record and file, at its own expense, a
financing statement on form UCC-1 (and continuation statements when applicable) with respect to the
Receivables now existing and hereafter created for the sale of chattel paper, payment intangibles,
general intangibles or accounts (as defined in Sections 9-102 of the UCC as in effect in any state
where either VDF or Servicer is “located” for purposes of Section 9-301 of the UCC) meeting the
requirements of applicable state law in such manner and in such jurisdictions as are necessary to
perfect the sale and assignment of the Receivables and the Collateral Security to the Trust, and to
deliver a file-stamped copy of such financing statements or other evidence of such filing to the
Trust on or prior to the Addition Date. In addition, VDF shall cause to be timely filed in the
appropriate filing office any form UCC-1 financing statement and continuation statement necessary
to perfect any sale of Receivables to the Trust. The Trust shall be under no obligation whatsoever
to file such financing statement, or a continuation statement to such financing statement, or to
make any other filing under the UCC in connection with such sale. The parties hereto intend that
the sales of Receivables effected by this Agreement be sales.



     (c) In connection with such sale, VDF further agrees, at its own expense, on or prior to the
Addition Date, to indicate in its computer files that the Receivables created in connection with
the Additional Accounts designated hereby have been sold and the Collateral Security assigned to
the Trust pursuant to this Assignment for the benefit of the Noteholder, the Residual
Interestholder and any Enhancement Providers. In addition, in connection with such sales, VDF
shall deliver within ___days after the Addition Date to the Owner Trustee all documents
constituting “instruments” (as defined in the UCC) with such endorsements attached as the Trust may
reasonably require.



     4. Acceptance by the Trust. Subject to the satisfaction of the conditions set forth
in Section 5 of this Assignment, the Trust hereby acknowledges its acceptance of all right,
title and interest to the property, now existing and hereafter created, conveyed to the Trust
pursuant to Section 3(a) of this Assignment, and declares that it shall maintain such
right, title and interest, upon the trust herein set forth, for the benefit of the Noteholders, the
Residual Interestholder and any Enhancement Providers. The Trust further acknowledges that, prior
to or simultaneously with the execution and delivery of this Assignment, VDF delivered to the Trust
the computer file or microfiche or written list (which may be in electronic form) relating to the
Additional Accounts described in Section 2 of this Assignment.



68









 





     5. Conditions Precedent. The acceptance of the Trust set forth in Section 4
of this Assignment is subject to the satisfaction, on or prior to the Addition Date, of the
following conditions precedent:



     (a) Representations and Warranties. Each of the representations and warranties
required to be made by VDF as of the Addition Date pursuant to the Trust Sale and Servicing
Agreement shall be true and correct as of the date of this Assignment and as of the Addition Date;



     (b) Agreement. Each of the conditions set forth in Section 2.5(a) of the
Trust Sale and Servicing Agreement (other than Section 2.5(a)(i)) in the case of Automatic
Additional Accounts designated by VDF pursuant to Section 2.5(b) of the Trust Sale and
Servicing Agreement) applicable to the designation of the Additional Accounts to be designated
hereby shall have been satisfied; and



     (c) Additional Information. VDF shall have delivered to the Trust such information as
was reasonably requested by the Trust to satisfy itself as to the accuracy of the representation
and warranty set forth in Section 5(b)(i) of the Trust Sale and Servicing Agreement.



     6. Ratification of Agreement. As supplemented by this Assignment, the Trust Sale and
Servicing Agreement is in all respects ratified and confirmed and the Trust Sale and Servicing
Agreement as so supplemented by this Assignment shall be read, taken and construed as one and the
same instrument.



     7. Counterparts. This Assignment may be executed in two or more counterparts (and by
different parties in separate counterparts),each of which shall be an original but all of which
together shall constitute one and the same instrument.



     8. Choice of Law. THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REFERENCE TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF OR OF ANY
OTHER JURISDICTION, OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.



* * * *




69








 






     IN WITNESS WHEREOF, VDF, Trust and the Servicer have caused this Assignment to be duly
executed and delivered by their respective duly authorized officers as of the day and the year
first above written.



	 	 	 	 	 
	 	 	VOLKSWAGEN DEALER FINANCE, LLC,

as Transferor
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:
	 
	 	 	 	 
	 	 	VOLKSWAGEN CREDIT AUTO MASTER OWNER TRUST
	 
	 	 	 	 
	 	 	By: The Bank of New York (Delaware), not in its
individual capacity, but solely as Owner Trustee on
behalf of the Trust
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:
	 
	 	 	 	 
	 	 	VW CREDIT, INC.,

as Servicer
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:






70









 






EXHIBIT B




FORM OF ANNUAL SERVICER’S CERTIFICATE




(As required to be delivered on or before (April 30) of each

calendar year, pursuant to Section 3.5 of the

Trust Sale and Servicing Agreement)




VW CREDIT, INC.




	 	 	 	 	 
	 
	 
	 	VOLKSWAGEN CREDIT AUTO MASTER OWNER TRUST
	 	 
	 





     The undersigned, duly authorized representatives of VW Credit, Inc.(“VCI”), as
Servicer, pursuant to the Amended and Restated Trust Sale and Servicing Agreement dated as of
August 11, 2005 (as amended and supplemented, or otherwise modified and in effect from time to
time, the “Agreement”), by and among VOLKSWAGEN DEALER AUTO FINANCE, LLC, as Transferor, VCI, as
Servicer, and VOLKSWAGEN CREDIT AUTO MASTER OWNER TRUST, as the Trust, do hereby certify that:



     1. VCI is, as of the date hereof, the Servicer under the Agreement.



     2. The undersigned are Servicing Officers and are duly authorized pursuant to the Agreement to
execute and deliver this Certificate to the Rating Agencies, the Owner Trustee, the Indenture
Trustee, any Agent and any Enhancement providers.



     3. A review of the activities of the Services during the calendar year ended December 31,
___, and of its performance under the Agreement was conducted under our supervision.



     4. Based on such review, the Servicer has, to the best of our knowledge, performed in all
material respects all of its obligations under the Agreement throughout such year and no default in
the performance of such obligations has occurred or is continuing except as set forth in paragraph
5 below.



     5. The following is a description of each default in the performance of the Servicer’s
obligations under the provisions of the Agreement known to us to have been made by the Servicer
during the year ended December 31, ___, which sets forth in detail the (a) nature of each such
default, (b) the action taken by the Servicer, if any, to remedy each such default and (c) the
current status of each such default: (If applicable, insert “None.”)



 









 





     Capitalized terms used but not defined herein are used as defined in the Agreement.



     IN WITNESS WHEREOF, each of the undersigned has duly executed this Certificate this ___day
of _________.



	 	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:






 









 






EXHIBIT C




FORM OF REASSIGNMENT OF RECEIVABLES



AND ACCOUNTS




     REASSIGNMENT NO. ______OF RECEIVABLES, dated as of _________, ___(the “Reassignment”), by
and between Volkswagen Dealer Finance, LLC, a limited liability company organized and existing
under the laws of the State of Delaware (the “Transferor”), and Volkswagen Credit Auto Master Owner
Trust, a Delaware statutory trust (the “Trust”), pursuant to the Trust Sale and Servicing Agreement
referred to below.



W I T N E S S E T H :




     WHEREAS, the Transferor and the Trust are parties to the Amended and Restated Trust Sale and
Servicing Agreement dated as of August 11, 2005 (hereinafter as such agreement may have been, or
may from time to time be, amended, supplemented or otherwise modified, the “Trust Sale and
Servicing Agreement”);



     WHEREAS, pursuant to the Trust Sale and Servicing Agreement, the Transferor wishes to remove
certain Accounts from designation to the Trust (the “Removed Accounts”) and to cause the
Trust to reconvey the Receivables of such Removed Accounts [arising since the Removal Commencement
Date] [Note: Include preceding if the removal is without then existing Receivables.] and the
Collateral Security thereof, whether now existing or hereafter created, and all amounts currently
held by the Trust or thereafter received by the Trust in respect of such Receivables in the Removed
Accounts, from the Trust to VDF (as each such term is defined in the Trust Sale and Servicing
Agreement); and



     WHEREAS the Transferor is willing to accept such removal and reconveyance of the Receivables
in the Removed Accounts [arising since the Removal Commencement Date] [Note: Include preceding if
the removal is without then existing Receivables.], such Collateral Security and any related
amounts held or received by the Trust subject to the terms and conditions hereof;



     NOW THEREFORE, the Transferor and the Trust hereby agree as follows:



     1. Defined Terms. All terms defined in the Trust Sale and Servicing Agreement and
used herein shall have such defined meanings when used herein, unless otherwise defined herein.




     “Removal [and Reassignment] [Note: Include preceding if the removal is with then
existing Receivables.] Date” shall mean _________ ___, ___.



     2. Return of Lists of Accounts.



          a. The Trust shall deliver to the Transferor, any Agent, any Enhancement Providers and the
Rating Agencies not later than three Business Days after the Removal [and




 









 







Reassignment][Note: Include preceding if the removal is with then existing Receivables.] Date,
a written notice specifying the Determination Date (which may be the Determination Date on which
such notice is given) on which removal of certain Accounts from designation to the Trust and the
removal of the Receivables of one or more Accounts [arising since the Removal Commencement Date]
[Note: Include preceding if the removal is without then existing Receivables.] will occur, such
date being a Removal [and Reassignment] [Note: Include preceding if the removal is with then
existing Receivables.] Date.




          b. On or before the fifth business day after the Removal [and Reassignment] ] [Note: Include
preceding if the removal is with then existing Receivables.] Date, Transferor shall furnish to the
Owner Trustee and the Indenture Trustee a computer file, microfiche list or other list (which may
be in electronic form) of the Removed Accounts that were removed on the Removal [and
Reassignment][Note: Include preceding if the removal is with then existing Receivables.] Date,
specifying for each Removed Account as of the related Removal [and Reassignment][Note: Include
preceding if the removal is with then existing Receivables.] Date its number, the aggregate amount
outstanding in such Removed Accounts and the aggregate amount of Principal Receivables therein and
represent that such computer file, microfiche list or other list of the Removed Accounts is true
and complete in all material respects. Such file or list shall be marked as Schedule 1 to
this Reassignment and shall be incorporated into and made a part of this Reassignment as of the
Removal [and Reassignment][Note: Include preceding if the removal is with then existing
Receivables.] Date and shall amend Schedule 1 to the Trust Sale and Servicing Agreement.




     3. Conveyance of Receivables.



          a. The Trust does hereby transfer, assign, set over and otherwise convey to the Transferor,
without recourse, representation or warranty on and after the Removal [and Reassignment] [Note:
Include preceding if the removal is with then existing Receivables.] [Commencement] [Note: Include
preceding if the removal is without then existing Receivables.] Date, all right, title and interest
of the Trust in, to and under all Receivables [now existing at the close of business on the Removal
and Reassignment Date] [Note: Include preceding if the removal is with then existing Receivables.]
[arising on such date] [Note: Include preceding if the removal is without then existing
Receivables.] and thereafter created from time to time until the termination of the Trust in
Removed Accounts designated hereby, all Collateral Security thereof, all monies due or to become
due and all amounts received with respect thereto (including all Non-Principal Receivables), all
proceeds (as defined in Section 9-102 of the UCC) and Recoveries thereof.




          b. If requested by the Transferor, in connection with such transfer, the Trust agrees to
execute and deliver to the Transferor on or prior to the date of this Reassignment, a termination
statement or release with respect to the Receivables [existing at the close of business on the
Removal and Reassignment Date] [Note: Include preceding if the removal is with then existing
Receivables.] [arising on the Removal Commencement Date] [Note: Include preceding if the removal is
without then existing Receivables.] and thereafter created from time to time and Collateral
Security thereof in the Removed Accounts reassigned hereby (which may be a single termination
statement with respect to all such Receivables and Collateral Security) evidencing the release by
the Trust of its lien on such Receivables in the Removed Accounts and the




 









 







Collateral Security, and meeting the requirements of applicable state law, in such manner and
such jurisdictions as are necessary to remove such lien.




     4. Counterparts. This Reassignment may be executed in two or more counterparts (and
by different parties on separate counterparts), each of which shall be an original, but all of
which together shall constitute one and the same instrument.



     5. Choice of Law. THIS REASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REFERENCE TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF OR OF ANY
OTHER JURISDICTION, OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.



* * * *




 









 








     IN WITNESS WHEREOF, the undersigned have caused this Reassignment of Receivables to be duly
executed and delivered by their respective duly authorized officers on the day and year first above
written.



	 	 	 	 	 
	 	 	VOLKSWAGEN DEALER FINANCE, LLC,
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:
	 
	 	 	 	 
	 	 	VOLKSWAGEN CREDIT AUTO MASTER

OWNER TRUST
	 
	 	 	 	 
	 	 	By: The Bank of New York (Delaware), not in its
individual capacity, but solely as Owner Trustee on
behalf of the Trust,
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:






 









 






Schedule 1




LIST OF ACCOUNTS




[On File with Servicer]





 









 








Schedule 2




LIST OF
TRUST ACCOUNTS



[On File with Servicer]




 









 





Schedule 3




PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS




     In addition to the representations, warranties and covenants contained in the Trust Sale and
Servicing Agreement, the Transferor hereby represents, warrants, and covenants to the Trust as
follows on the Closing Date:


1. The Trust Sale and Servicing Agreement creates a valid and continuing security interest (as
defined in the applicable UCC) in the Receivables in favor of the Trust, which in the case of the
existing Receivables, is enforceable upon execution of the Trust Sale and Servicing Agreement, and
with respect to Additional Accounts and Automatic Additional Accounts then existing Receivables in
Additional Accounts and Automatic Additional Accounts, as of the applicable Addition Date, and
which will be enforceable with respect to Receivables hereafter and thereafter created, and such
security interest is prior to all other Liens and is enforceable as such as against creditors of
and purchasers from the Transferor.



2. The Receivables constitutes a “general intangible,” “instrument,” “account,” or “tangible
chattel paper,” within the meaning of the applicable UCC.



3. The Transferor owns and has good and marketable title to the Receivables free and clear of any
Lien, claim or encumbrance of any Person, excepting only liens for taxes, assessments or similar
governmental charges or levies incurred in the ordinary course of business that are not yet due and
payable or as to which any applicable grace period shall not have expired, or that are being
contested in good faith by proper proceedings and for which adequate reserves have been
established, but only so long as foreclosure with respect to such a lien is not imminent and the
use and value of the property to which the Lien attaches is not impaired during the pendency of
such proceeding.



4. The Transferor has received all consents and approvals to the sale of the Receivables hereunder
to the Trust required by the terms of the related Floorplan Financing Agreement to the extent that
it constitutes an instrument.



5. The Transferor has caused or will have caused, within ten days after the effective date of the
Trust Sale and Servicing Agreement, the filing of all appropriate financing statements in the
proper filing office in the appropriate jurisdictions under applicable law in order to perfect the
sale and the security interest of the Receivables arising in the Accounts designated to the Trust
on the Closing Date and in Additional Accounts and Automatic Additional Accounts, and if any
additional filing is necessary, within 10 days of the applicable Addition Date, in the case of
Receivables arising in Additional Accounts or Automatic Additional Accounts.



7. To the extent that the Receivables constitute an instrument or tangible chattel paper, all
original executed copies of each such instrument or tangible chattel paper have been delivered to
the Trust or to the Servicer as custodian.



8. Other than the security interest granted to the Trust pursuant to the Trust Sale and Servicing
Agreement, the Transferor has not pledged, assigned, sold, granted a security interest in, or
otherwise conveyed any of the Receivables. The Transferor has not authorized the filing




 









 







of, nor is aware of, any financing statements against the Transferor that include a description of
collateral covering the Receivables other than any financing statement relating to any security
interest granted pursuant to the Basic Documents or that has been terminated.



9. No instrument or tangible chattel paper that constitutes or evidences the Receivables has any
marks or notations indicating that it has been pledged, assigned or otherwise conveyed to any
Person other than the Trust or the Indenture Trustee.